Shinhan Financial’s overseas share of net profit surpasses 15% for first time

Shinhan Financial Group Co.’s headquarters in Seoul.

Shinhan Financial Group Co., one of South Korea’s four major financial groups, raised 410.8 billion won ($299 million) in net profit from its global business in the first half of this year, which accounts for 15 percent of its entire net profit.

According to an analysis by Maeil Business Newspaper on Wednesday on the country’s four major financial groups’ global sector net profits in the first half of 2024, Shinhan Financial posted the largest net profit of 410.8 billion won, followed by Hana Financial Group (292.5 billion won), Woori Financial Group (186 billion won), and KB Kookmin (3.3 billion won).

Shinhan‘s global business accounted for 15 percent of its entire first-half net profit, up from 11.8 percent in the first half of 2023.

Hana’s global business took up 14.1 percent of its entire net profit while Woori 10.6 percent and KB Kookmin 0.1 percent.

Shinhan Financial’s global net profit surpassed the net profits (domestic and overseas combined) of its main subsidiaries, such as Shinhan Card Co., Shinhan Life Insurance Co., and Shinhan Securities Co., excluding Shinhan Bank Co.

Shinhan Card recorded a net profit of 379.3 billion won and Shinhan Life 312.9 billion won in the first half.

Shinhan Financial’s strong performance in its overseas segment is attributed to the solid results of Shinhan Bank Vietnam Ltd. and Shinhan Bank Japan, along with its improved profitability in Southeast Asia.

Shinhan Financial has been strengthening its business by expanding its operations based on a strategy that creates synergy among subsidiaries such as cards, insurance, and banking.

Shinhan Financial is expanding its global reach.

Shinhan Bank made an equity investment in HDFC Credila, an Indian student loan specialist, in April 2024.

Woori Financial and Hana Financial, in the meantime, also showed relatively strong performance in their overseas divisions during the cited period, increasing their share of net profits within their financial groups.

Woori Financial has been expanding operations with a focus on its five major subsidiaries in Indonesia, Vietnam, Cambodia, the United States, and China.

This year alone, Woori Financial increased capital by $200 million for Bank Woori Saudara Indonesia and $100 million each for Woori Bank Vietnam Ltd. and Woori Bank (Cambodia) Plc.

Woori Bank Vietnam recently paid its first dividend seven years after its establishment as a subsidiary.

In the case of Hana Financial, 37 percent of its overseas net profit of 292.5 billion won came from equity method gains of investment subsidiaries.

BIDV, a state-owned commercial bank in Vietnam, in which Hana Financial acquired a 15 percent stake in 2019, performed particularly well, generating a profit of 73.2 billion won, more than double the same period a year ago.

KB Financial’s overseas performance, in the meantime, was relatively sluggish.

Unlike other financial groups that primarily generated overseas earnings through their banks, KB Financial saw losses from KB Kookmin Bank.

KB Bank Indonesia, formerly Bank KB Bukopin, suffered losses, resulting in KB Financial‘s overseas net profit amounting to only 3.3 billion won in the first half of this year.