Hot Quarterly Performance

Shinhan Financial Group hikes 1st qtr earnings 22.7 pct

Shinhan Financial Group, the nation's second largest financial services group, said its net profit rose 22.7 percent in the first quarter from a year earlier, helped by boosts in earnings by its affiliates.
Income in the Jan.-March period reached 476.3 billion won, compared with 388 billion won a year earlier, the group said.
The bottom figure rose 2.2 percent from the previous quarter. Stellar earnings reports from its affiliates, including Goodmorning Shinhan Securities Co., Shinhan Capital and Shinhan Bank help boost the group's greatest quarterly gains.
Combined net profits from non-banking affiliates surged 250 percent from the same period last year, accounting for 18.5 percent of the group's aggregate net profit. Chohung Bank which merged with Shinhan Bank last month, recorded 200 billion won in net profit, up 59.5 percent from a year earlier, the group said. Shinhan Bank's bottom line rose 4.5 percent y-o-y to 228.1 billion won. The group acquired Chohung in 2003 for 3.3 trillion won.
Shinhan Bank, which had a new start after acquiring Chohung Bank, on April 1, is expected to bring a fresh change in the nation's banking environment, especially with Kookmin Bank in the process of acquiring Korea Exchange Bank. The new Shinhan Bank has its total assets increased to 163 trillion won, second only to Kookmin Bank with 197 trillion won in total assets. The country will have four major commercial banks if Kookmin Bank succeeds in taking over the KEB as planned: Kookmin, Shinhan, Woori, and Hana banks.
The bank will continue to be a key affiliate of the Shinhan Financial Group as it has since its establishment as an integrated financial group in 2001. The financial group has been working for the growth of synergy between its banking and non-banking affiliates by marketing the products of non-banking through the bank's strong network, including credit card, securities, insurance, and trust.
The group has been considering taking over the LG Card Co. in that regard to become a top credit card operator in the country. By doing that, the group will build up its image as the top financial group in the country as well as securing new profit sources through the economy of scale in the credit card sector with the addition of LG Card and achieve synergistic effect with the diversified customer base.
The new Shinhan Bank's vision is the bank of pride for all those concerned including customers, officers and staff of the bank, and all the people in the country. It aims to be an enterprise that gives pride and dignity to industry and the country. It also means that the bank will position itself in the minds of the people so that they would think about Shinhan when they talk about banks. It also would like to be a top representative bank for the country.
The new Shinhan's payroll list expanded to 13,700 including contract employees with its branches and depositary outlets numbering 962, in addition to l16 overseas branches and subsidiaries. Outstanding loans total 96.2 trillion won and deposits 95.3 trillion won. Its net profit amounted to 1.64 trillion won. Its BIS ratio stands at 11.62 percent, ROE 20.72 percent, ROA 1.09 percent, and NIM 2.8 percent. The bank's non-performing asset ratio reached 1.05 percent.
Chairman Ra Eung-chan of the financial group congratulated all officers and staff of the new Shinhan for their hard work during the past 2 and half years to prepare for the integration of the two banks since the acquisition was announced. At the ceremony marking the opening of the new Shinhan Bank held on
April 1, he said the new Shinhan is a giant bank with the number of its customers totaling over 16 million, and in the scale of asset, branch network, and the number of employees. He called on all those working for the bank to change their way of thinking as the bank has become larger in infrastructure and systems positioning to be a world-class bank.
In the meantime, Shin Sang-hoon, president of the bank, said he feels an enormous responsibility as the first president of the new bank. He said he will focus on three directions in leading the bank: to be dynamic, challenging and trusty bank. Pointing to the fact that the bank could inconvenience some of its clients in providing services as a newly-integrated bank, he called on every employee to pay a special attention to eliminating those disadvantages that might arise in its operation. What they need to do is to stick by the program, "jump"to reduce errors in operating the new systems and new hardware, he said.
He also said that he will look far ahead all the time to make Shinhan to be a trusty and loving bank. He will be like a farmer in the spring, cultivating the fields and cutting weeds in the hot summer, looking for a bountiful harvest in the fall. nw

President Lee In-ho of the Shinhan Financial Group.