Focus on Expansion

Top bank in soundness index to strengthen its PB facilities and credit card operations

Hana Bank's core management strategies focus on expanding low-interest deposits, credit card operations, installment-type securities to double in volume and strengthening cross-selling through the expansion of SOHO loans ROAA. The bank plans to especially strengthen the credit card operation and to back it up, the bank has carried out a reorganization which included the separation of the credit card operation headquarters and bring it directly under the bank management as an independent unit in order to make it accessible to the database of customers of related affiliates and the expansion of the number of companies to undertake joint marketing.
At the end of last year, the bank's soundness indicators showed that they were tops in the banking industry with non-performing assets ratio standing at 0.69 percent, coverage ratio 172.9 percent, and+ default ratio 0.76 percent.
This year, the business trend for banking is expected to be some what worse than last year and the bank plans to operate an early warning system to pick off early sings of risks and strengthen measures to deal with them including loan reviews and strict management of portfolio so that the bank could be able to sustain its top soundness indicators in the industry as before.
Some banks with private banking facilities have been known to have kicked off the "red carpet"marketing through luxurious interiors for their branches. But Hana feels that what the customers want are banking products and services that suit them the most which depends on how a bank will manage its integrated asset management with know-how available to them.
Hana will try to upgrade its competitive edge in the private banking with offensive strategies to move it ahead of its rivals.
The bank will strengthen the function of Gold Club by assigning more professional manpower and supplement the system. It will also try to come up with financial products and services that will satisfy the customers'needs. The bank will also reform the professional manpower education programs to refine the skills to manage customers assets and to improve operation of PB. The bank will develop the incentives for personnel assigned to the PB units so that they will be reimbursed for the work they put in to improve the operation of PB sectors.
The bank strategies for multiple outlets are intended to secure a base for the expansion of the integrated financial services through the establishment of integrated banking outlets. This year, 10 more such banking facilities will be added to the current 52.
Last year, the bank focused mainly on building those outlets, but this year the bank will focus on the operation of those facilities by spurring their business activities by handling such products as the exchange sales and connected banking operations. The one-stop service differentiated for the multiple banking outlets will promoted as a new banking business model.
One of the key business strategies for the bank is to expand the number of its SME customers and provide them with a speedy and correct fund management on real time basis. The bank will also expand the BiCNET installations to promote the sales exchange of credit card, retirement pension, and derivative products, among others, so that they would make up the major customer groups for the bank.
In 2006, Hana provided 9.2 trillion won in net increase in loans to SMEs and the share of superior financial assets improved over 2005, achieving both quantitative and quality growth, enabling Hana to win a presidential award for its outstanding support for SMEs during last year.
The bank plans to increase 3.2 trillion won in net in loans provided to SMEs this year, in consideration of the natural cut in the amount of loans to SMEs, the possibility for reduced economic growth for this year, and the strengthened management of BIS ratio ahead of the Basel 2 upcoming this year. The bank will pursue strategies for quantitative growth as well as soundness and its profit increase.
Hana Bank's ultimate vision is to be developed enough to be a superior financial network to provide an integrated financial service in this rapidly changing financial environment and based on its core capacity. The bank will try to go about achieving the vision through the four missions of customer satisfaction, the maximization of shareholders'value, and the creation of employee value and contribution to the common entity. The bank aims at making the 100 list of best banks in the world by 2009, the 50th anniversary of its founding, in terms of asset and market and capitalization value. The bank will shoot for maintaining such key indicators as ROE at upwards of 20 percent, ROA more than 1.25 percent, and NPL below 1 percent under the slogan of "Achieve Excellence Together."By 2009, the bank will be among the 100 largest banks in terms of market capitalization and become a bank with quality excellence with superior integrated services. nw

Hana Bank President Kim Jong-yeol is flanked by the officials of Euromoney after receiving the award for the bank being namded as Best Private Bank in South Korea for 2007 in London Feb. 1.