Up 11.2% Year-on-Year
Non-Interest Income Also Rises 10%
Additional 200 Billion Won Share Buyback and Cancellation Approved
Hana Financial's core profit amounted to 5.5715 trillion won (interest income of 4.4911 trillion won and fee income of 1.0804 trillion won), up 2.9% (157.1 billion won) year-on-year. The net interest margin (NIM) for the second quarter was 1.73%.
The group's non-interest income reached 1.3982 trillion won, an increase of 10% (126.6 billion won) compared to the same period last year. In particular, trading gains, including those from securities and foreign exchange derivatives, rose by 28.1% (181.2 billion won) year-on-year to 826.5 billion won. Fee income increased by 4.6% (47.6 billion won) from the previous year to 1.0804 trillion won, driven by higher underwriting and advisory fees from expanded investment banking, as well as growth in accumulation-type fees such as retirement pensions, bancassurance, and operating leases.
The group's estimated Common Equity Tier 1 (CET1) ratio stood at 13.39%, up 59 basis points (bp; 1bp=0.01%) from the same period last year, thanks to improvements in the asset portfolio focused on risk-weighted return on assets (RoRWA) and solid profit generation. This ratio is being stably managed within the target range of 13.0% to 13.5% set by the corporate value enhancement plan. The group's return on equity (ROE), a key profitability indicator, improved by 40bp year-on-year to 10.76%, while return on assets (ROA) rose by 4bp to 0.73%. The group's estimated BIS ratio is 15.58%.
The group's cost-to-income (C/I) ratio for the second quarter was 38.5%, an improvement of 0.2 percentage points year-on-year. The credit cost ratio at the end of the first half was managed at a stable level of 0.30%, and the ratio of non-performing loans (NPL) was 0.75%. As of the end of the first half, the group's total assets amounted to 835.3255 trillion won, including 193.2322 trillion won in trust assets.
By affiliate, Hana Bank recorded a consolidated net profit of 2.0851 trillion won for the first half, including 1.0922 trillion won in the second quarter. This is an increase of 19.1% (334.2 billion won) compared to the same period last year. Notably, non-interest income jumped 74.4% (316 billion won) year-on-year to 740.6 billion won. Hana Financial explained that this strong performance was the result of synergies among the bank's core businesses?corporate finance, foreign exchange, and wealth management?leading to expanded investment banking assets, improved trading performance, the largest increase in retirement pension reserves in the financial sector, and the top market share in public fund sales among banks.
The bank's core profit, combining interest income (3.9003 trillion won) and fee income (501.8 billion won), amounted to 4.4021 trillion won, with a second-quarter NIM of 1.48%. The NPL coverage ratio was 138.68%, the ratio of non-performing loans was 0.35%, and the delinquency rate was 0.35%. As of the end of the first half, Hana Bank's total assets stood at 642.009 trillion won, including 110.276 trillion won in trust assets.
Hana Card posted a cumulative net profit of 110.2 billion won for the first half, Hana Securities 106.8 billion won, Hana Asset Trust 31 billion won, Hana Capital 14.9 billion won, and Hana Life 14.2 billion won.
Meanwhile, the board of directors of Hana Financial Group resolved to further enhance its shareholder return policy by approving an additional share buyback and cancellation worth 200 billion won and a quarterly cash dividend of 913 won per share. Hana Financial completed its previously announced 400 billion won share buyback program ahead of schedule in the first half. The company stated, "We expect to buy back at least 600 billion won worth of shares within the year, and as the number of dividend-eligible shares decreases, a gradual increase in quarterly dividends per share is anticipated."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
