Hana Financial Group announced on April 22 that it posted 902.2 billion won in net profit in the first quarter.
This was an increase of 8 percent (66.6 billion won) from the same period of 2021.
“Hana Financial Group continued to grow in 2021 thanks to the solid growth of core profits and the diversification of its profit portfolio,” a Hana Financial Group official said.
“Our net profit increased from the previous year despite internal and external uncertainties such as the prolonged COVID-19 pandemic, preemptive provisions for bad debts, and high one-time expenses due to special retirements from banks and credit card companies,” the official added.
The group’s core profit, which combines interest income (2,020.3 billion won) and commission income (453.5 billion won), reached 2.437 billion won, up 12.9 percent from the same period of 2021.
This was the fifth consecutive quarter of growth. This was attributed to increases in loan assets centered on SME loans and foreign exchange and investment banking (IB)-related commission income.
In addition, trading and valuation gains climbed by 93.4 percent, or 98.1 billion won compared to the same period of the previous year, to reach 203.1 billion won thanks to an improvement in foreign exchange trading gains and gains on the valuation of beneficiary certificates of non-bank affiliates.
The group’s net interest margin (NIM) stood at 1.71 percent in the first quarter.
Hana Financial Group secured sufficient loss absorption capacity by preemptively accumulating bad debt provisions in preparation for internal and external uncertainties.
In the first quarter, the transfers, including provisions, sat at 170.1 billion won, an increase of 72.4 percent (71.5 billion won) compared to the same period of 2021. The group’s credit cost was 0.19 percent in the first quarter.
Company-wide risk management efforts also made the group’s asset quality indicators Stable. Its non-performing loan (NPL) coverage ratio in the first quarter hit 160.4 percent, an increase of 20.34 percentage points compared to the same period of the previous year.
Its NPL ratio stood at 0.36 percent, up by 4bp compared to the same period of 2021. Its delinquency rate stayed at 0.29 percent, improving by 1bp from the same period of 2021.
Hana Financial Group’s estimated BIS ratio stood at 16.06 percent at the end of the first quarter, maintaining excellent capital adequacy thanks to the early introduction of Basel III and an increase in the capital ratio due to sound performance and stable risk-weighted asset management.
Its return on equity (ROE) which is a key management indicator reached 10.69 percent while its return on assets (ROA) 0.72 percent.
Hana Financial Group’s cost income ratio stood at 49.6 percent in the first quarter, up 3.1 percentage points from the same period of 2021 due to the recognition of large-scale one-time expenses for special retirements at banks and credit card companies.
However, excluding one-off costs, the cost income ratio hit 42 percent.
As of the end of the first quarter, the group’s total assets including 15,405 billion won in trust assets stood at 684,958.6 billion won.
Hana Financial Group’s board of directors decided to cancel 150 billion won worth of treasury stock for the first time since the group’s foundation in 2005 as part of a diversified shareholder return policy and inheriting the group’s 15-year interim dividend tradition.