[Hana Financial Group]
[Hana Financial Group]

Hana Financial Group posted record first-half earnings on the back of growth in its wealth management and investment banking businesses. Fee income jumped nearly 40%, driving core profit expansion, and the group said it would continue quarterly dividends and share buybacks and cancellations to boost shareholder returns.

Hana Financial Group said Friday its net profit for the first half of this year reached 2.4 trillion won ($1.64 billion), up 4.4 percent from the same period last year — the highest ever for a first-half period. Second-quarter net profit came in at 1.19 trillion won, a 1.7 percent increase year on year.

Core income — the sum of interest income and fee income — rose 13.0 percent year on year to 6.3 trillion won in the first half. Fee income in particular surged 37.7 percent, or 406.9 billion won, to 1.49 trillion won, leading the earnings improvement.

The group attributed the gains to expanded revenue from its wealth management business, including trust fees, securities brokerage commissions, and discretionary investment and fund management fees, as well as higher underwriting, arrangement and advisory fees from a stronger investment banking portfolio.

The group's net interest margin for the second quarter stood at 1.88 percent. On asset quality, the non-performing loan ratio rose 0.13 percentage points from the previous quarter to 0.93 percent, while the delinquency rate fell 0.02 percentage points to 0.59 percent. The estimated common equity tier 1 ratio was 13.21 percent.

"We are maintaining a stable capital level by allocating capital increases from net profit in a balanced way between growth and shareholder returns," a Hana Financial official said.

Hana Bank, the group's core subsidiary, posted first-half consolidated net profit of 2.12 trillion won, up 1.7 percent from a year earlier. Second-quarter net profit was 1.02 trillion won.

Hana Bank said it maintained solid earnings by strengthening its core businesses — wealth management, retirement pension, trust and foreign exchange — despite one-off costs including loan-loss provisions tied to a major corporate group's court receivership filing and foreign exchange losses from a weaker won.

The bank's first-half core income totaled 5.08 trillion won, with fee income reaching 614.3 billion won, up 22.4 percent, or 112.4 billion won, from a year earlier. Total assets at the end of the first half stood at 729.2 trillion won, including 142.4 trillion won in trust assets.

Among non-bank subsidiaries, Hana Securities sharply improved its earnings on the back of a buoyant stock market. Hana Securities reported first-half net profit of 273.1 billion won, up 155.7 percent year on year, driven by higher brokerage commissions from increased trading volume and proactive risk management. Hana Card posted first-half net profit of 125.9 billion won, Hana Capital 104.5 billion won, and Hana Life Insurance 14.6 billion won.

The board of directors on Friday decided, as part of its shareholder return policy, to buy back and cancel an additional 250 billion won worth of shares in the third quarter, and set the quarterly cash dividend at 1,155 won per share — a 26.5 percent increase from the same period last year.

Alongside this, Hana Financial unveiled its Corporate Value Enhancement Plan 2.0, raising its return on equity target from 10 percent or above to 12 percent and setting a shareholder return ratio target of 50 percent or more.

The group said it would introduce a new shareholder return framework linking ROE and risk-weighted asset growth, and would increase total annual dividends by at least 10 percent each year until a payout ratio of 40 percent is achieved.

The group also adjusted its CET1 target to 13 percent or above, with any capital exceeding that threshold to be used for shareholder returns. Risk-weighted asset growth will be managed in line with nominal GDP growth to improve capital efficiency.

To boost ROE, the group identified three future growth pillars: strengthening the bank's core competitiveness, expanding non-bank profitability, and securing an early foothold in the digital asset ecosystem. The group said Hana Bank's equity investment in Dunamu in May was part of a strategy to broaden its mid- to long-term earnings base.

Hana Financial also plans to acquire an additional 40 million shares of its non-life insurance subsidiary Hana Insurance for 200 billion won. Following the acquisition, Hana Financial Group's stake in Hana Insurance will reach 100 percent. The transaction is scheduled to close on Wednesday.


forest@heraldcorp.com