The net profit of the five major financial groups decreased by nearly 1 trillion won compared to the previous year due to compensation costs related to Hong Kong H-index equity-linked securities (ELS). KB Financial, which had been the leading bank, lost its top position to Shinhan Financial, resulting in mixed fortunes.
According to the financial sector on the 27th, the first-quarter net profit of the five major financial groups?KB, Shinhan, Hana, Woori, and NH Nonghyup?was recorded at 4.8803 trillion won. This is a decrease of 979.4 billion won (16.7%) from the previous year (5.8597 trillion won).
Shinhan Financial reclaimed its position as the leading bank by recording a first-quarter net profit of 1.3215 trillion won. Although Shinhan Financial reflected 274 billion won in provisions for Hong Kong ELS compensation costs, the decline compared to the previous year was limited to about 4.8%.
KB Financial's first-quarter net profit was 1.0491 trillion won, down 30.5% from the previous year. Operating losses expanded significantly as approximately 862 billion won in provisions for Hong Kong ELS customer compensation costs were recognized. Shinhan Financial's net profit exceeded KB Financial's by 272.4 billion won.
Hana Financial recorded a first-quarter net profit of 1.034 trillion won, down 6.2% from the previous year. Hana Financial stated that despite large one-time expenses such as 81.3 billion won in foreign exchange losses due to exchange rate increases and 179.9 billion won in provisions for Hong Kong ELS, it showed solid performance.
Woori Financial's first-quarter net profit was 824.5 billion won, down 9.8% from the previous year. Although Woori Financial had expectations for a change in ranking due to provisions of only 7.5 billion won related to Hong Kong ELS compensation costs, it remained in third place.
NH Nonghyup Financial recorded a first-quarter net profit of 651.2 billion won, down 31.2% from the previous year. NH Nonghyup Financial also reflected 341.6 billion won in losses related to Hong Kong ELS compensation in its performance.
Shinhan Bank Also Takes First Place Among Banks
Shinhan Bank recorded a first-quarter net profit of 928.6 billion won, down 0.3% from the previous year, achieving the highest net profit among banks. Hana Bank followed in second place with a first-quarter net profit of 843.2 billion won, down 13.1% from the previous year.
Woori Bank's first-quarter net profit was 789.7 billion won, down 8.4% from the previous year, while NH Nonghyup Bank's first-quarter net profit was 421.5 billion won, down 37.3% from the previous year.
Kookmin Bank's first-quarter net profit was 389.5 billion won, down 58.2% from the previous year, marking the poorest performance among the five major banks. As the bank with the largest ELS sales, KB Kookmin Bank saw a significant decrease in net profit due to expanded non-operating losses related to ELS compensation.
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