KB recaptures the first place in finance after 3 years… Shinhan ankles on provisions for private equity
The record-breaking performance of the debt-fighting fever… Allowance for bad debts split for 1st and 2nd place
Only Woori Finance decreased net income
[아시아경제 이광호 기자] Among the four major financial holdings last year,’Leading Finance’ was KB Financial Group. While Shinhan, Hana, and Woori Finance were caught in the private equity crisis, KB Finance surpassed Shinhan Finance in three years and rose to the top spot.
Despite the bad news of Corona 19 and the prolonged low interest rate, all of KB, Hana, and Woori Finance, except for Woori Finance, recorded record-breaking performance due to the craze for debt (invest from debt) and young (to attract the soul).
◆No. 1 position changed in 3 years… KB and Shinhan changed positions = According to the financial sector on the 7th, KB Financial Group recorded a net income of 3,4552 billion won last year. It is 10.6 billion won compared to Shinhan Finance 3,4146 billion won during the same period. It has been three years since KB Financial exceeded Shinhan Financial Group.
The decisive factors that changed the rankings of these two companies are analyzed by the private equity situation and provisions. This is because provisions for preemptive compensation, etc., had to be accumulated due to the Lime Management Fund crisis. In the case of Shinhan Financial Group, the annual provisioning amount is KRW 1.3906 billion. KB Finance is KRW 1.4 trillion, which is 350 billion KRW less than Shinhan. Among the four major financial sectors, KB Financial was not involved in various fund events such as the Lime Fund crisis, so there were few related losses.
The two financial holding companies have been competing up and down. Shinhan Financial Group led the way in the first quarter of last year and KB Financial Group in the second and third quarters. Both companies increased interest income due to lending growth and made good results in securities and cards. Continuous investment in non-banking sectors, including overseas expansion, also succeeded. In fact, KB Finance has grown in size by taking over Prudential Life Insurance last year. KB Kookmin Bank bought global banks such as Cambodia Prasak.
[이미지출처=연합뉴스]
◆ Record-breaking performance excluding us amid the debt-fighting craze = Hana Financial Group also posted a record-high performance with net income of 2.637.2 billion won last year. This is a 10.3% increase from the previous year. Although it accumulated 8473 billion won in provision for bad debt, the group’s core profit, which combined interest income (5,814.3 billion won) and commission income (2,255.7 billion won), increased 1.8% year-on-year.
On the other hand, Woori Financial Group was the only one among the four major financial holding companies to laugh. Woori Financial Group recorded a net profit of 1.3 trillion won last year, down 30.2% from the previous year. Net operating income, a key indicator of earnings such as interest income and non-interest income, remained at the level of the previous year at about 6.8 trillion won, but the fact that it does not have a securities company, which was the key to the performance of other financial holding companies, was a bad thing. Provision for bad debts was also accumulated at 784.4 billion won.
Accordingly, last year’s four major financial groups reaped a total net income of 10,814.3 billion won. It was a slight decrease from the previous year’s 10,995.9 billion won, but it is an evaluation that it saved even amid the corona 19 and private equity crisis.
However, due to the recommendations of the financial authorities, the dividend payout ratio of the majority of financial groups decreased compared to the previous year. The Financial Services Commission recommended a guideline of’within 20% dividend payout ratio’ in consideration of the domestic and foreign economic uncertainties remaining due to the prolonged Corona 19. With the exception of Shinhan Financial Group and Woori Financial Group, which have not disclosed their dividend policy, both KB Financial Group and Hana Financial Group have lowered their dividend payout ratios to the level of 20%.
Reporter Lee Kwang-ho [email protected]