NH Bank Aims for 1 Tln Won in Net Profit

Bank to speed up its services in all areas to shed its old image and introduce new products

Chairman Shin Chung-shik of NH Bank, who also heads NH Financial Holding Co., has been busy at work to make NH Bank known throughout the country since its restructuring following the division of Nonghyup into two holding companies, NH Financial Holding Co. and NH Economic Holding Co.
The new chairman meets with his staff at the bank as well as tours the branches in large cities around the country to speak to the bank’s customers. “The bank for customer happiness,” is the catchphrase for the new bank.
Nonghyup formally announced on March 3 its reorganization. Under NH Financial Holding Co. are the financial affiliates including NH Life Insurance, NH Fire and Marine, and NH Securities.
Chairman Shin’s major task this year is to have the holding company system take deep root, a daunting task as the economic conditions and the financial business environment have not been good so far this year. In addition, government policy has been directed at curbing household loans and at holding down excessive competition among banks around the country.
To kick off the campaign to widen the public knowledge of NH Bank, the four new loan accounts and 10 new credit card products will be introduced to boost the bank’s prestige and competitiveness with the aid of advice provided by outside professional organizations.
The new CEO will make sure that the bank’s marketing campaign is tailor-made to what customers would like to know. During his visit to the bank’s Yeongdeungpo Branch in Seoul on March 6, he met with customers and heard their opinions on the bank’s financial products and services as part of his effort to shed the bank’s old image and make it an easy place to work with as a bank that “pursues customer happiness.”
The bank has decided to provide training to 800 branch manager-level officers and reduced the grades of branches from seven to four to merge a number of branches and set up 213 unmanned branches to raise the service quality and convenience for customers.
The bank will focus on handling policy loans that go to improve farm facilities. Funds provided to agricultural areas to develop foodstuffs will now include fishery products, so they will strengthen the units that deal with loans to the fishery communities.
Nonghyup bank offers commercial banking transactions for its member cooperatives, including 108 trillion won in outstanding loans as of the end of 2007, and it provides retail banking for consumers and individuals in South Korea, including 102 trillion won of loans. Nonghyup bank also provides insurance services and is a member of BC Card. In 2008, Nonghyup purchased from ACX Pacific Northwest a straw processing plant located in Albany, Oregon.
Shin called for strict management of international operations of the financial affiliates with the focus on communication and effective risk management so that a system can be set up to rapidly cope with changes and risks as they develop.
“We do not have the time to be indecisive and hesitant to take actions with the reorganization as an excuse. We have to settle the operation under the new system as early as possible and we have to set up a system to give our operation stability as early as possible,” the new chairman said in his inaugural speech. He also said NH Bank will upgrade its New York office to a branch soon in order to be a leading bank in Asia, as it already has offices in China, Vietnam, India, and Indonesia. The bank will also strengthen its investment banking and corporate banking, two of the weak areas of the bank, as it aims to achieve over 1 trillion won in net profit for this year.
Also as important is the creation of a corporate culture since NH Financial has been known as an entity that is very slow to take action because it is too big.
As far as scale is concerned, NH Financial is not too far behind the four large financial groups in Korea and it has the largest number of branches across the country, far ahead of its rivals including Kookmin Bank, whose branch number totals 1,167 compared to the 1,175 of NH Bank. NH Life Insurance is the fourth largest in the industry while its non-life affiliate is ninth in the industry, but both insurance firms are not up to par in the area of speed and professionalism compared to others.

Chairman Shin Chung-shik of NH Bank and NH Financial Holding Co.