Hana Bank sees largest loan growth among major banks in H1 thanks to reshuffling

Hana Bank headquarters in Seoul [Courtesy of Hana Bank]

Hana Bank thrived across various areas in the first half of this year, most notably with loans to large corporations increasing by over 30 percent, on the back of the bank‘s new two-track sales strategies, accompanied by sales reshuffling.

According to Hana Bank on Tuesday, the bank’s loan balances to large corporations rose by 31.8 percent in the first half of this year, marking the largest increase among the four major commercial banks. According to industry sources, the loan growth to large corporates among commercial banks in the first half of this year, excluding Hana Bank, was in the 10 percent range. In fact, the total loan balance of the four major banks rose by 16.7 percent to 104.46 trillion won ($80.8 billion) at the end-June from 89.49 trillion won at the end of 2022. The growth rate is only half of that of Hana Bank.

Hana’s total corporate loans, including those to small and medium-sized enterprises, rose by 7.5 percent, or 10.6 trillion won, to 153.1 trillion won as of end-June. The bank’s performance in the first half of this year is, consequently, estimated to be strong. In the first quarter, Hana Bank gained a net profit of 970.7 billion won from expanding corporate loans, surpassing the net profits of Kookmin Bank and Shinhan Bank, each of which had net gains of 931.5 billion won, as well as Woori Bank with a net gain of 859.5 billion won.

Hana Bank targeted corporates for its sales strategy from early on this year, accelerating its steps while its competitors such as Shinhan Bank and Woori Bank were moving slowly due to leadership vacancies. Hana Bank President Lee Seung-Lyul, who took over in January, had already been on the front line of the bank‘s sales since December, right after his nomination for the position. “Even the vice presidents cannot often meet Lee these days as he is working on the front line of sales, targeting large corporates,” said an unnamed vice president of the bank.

The bank’s tie-up product with Naver Pay Money, which has gained popularity recently, is one of the successes resulting from the bank‘s sales strategies. While other banks were reluctant to partner with Naver Financial Corp. due to the idea of Naver being involved in deposit brokerage, the core business of banks, Hana Bank took a proactive approach to Naver’s proposal. The bank’s move was reportedly based on strong commitment from top executives, including Vice Chairman of Hana Financial Group Inc., Park Sung-ho, who had built trust with the IT company during his time as the bank’s president. The two parties continue to solidify their business relationship at both the operational and executive levels.

The bank also underwent a reshuffling of its sales arms at the beginning of the year. It made a shift to a region-based sales approach to improve the efficiency of the bank’s sales arms, reintroducing regional representatives, who act as a link between the regional sales arms and the headquarters. This reorganization has resulted in a significant increase in the performance of each sales office. The Gangseo sales center emerged as the top performer among all sales centers, seeing a 17.5 percent increase in corporate loan balances in the first half of the year alone, followed by the central sales branch, with a 12.8 percent increase in corporate loan balances. The bank has compensated for its lack of branch offices compared with other commercial banks through its specialized corporate banking division, employing aggressive sales approaches that include in-person meetings with SMEs.

In the second half of the year, the bank plans to enhance its presence in the mergers and acquisitions financing market, which is likely to face fierce competition as Shinhan Bank and Woori Bank are also expected to actively engage in corporate loan sales. Hana Bank is preparing for the competition by proactively meeting with companies of interest, led by its executives. The bank has also undergone a reorganization for the second half of the year, which involved promoting the investment banking division under the Commercial Investment Banking (CIB) group and establishing an equity investment division.