Doosan Baek

Doosan Baek of Korea Investment & Securities inquired about the performance of recent digital investments, such as UN Banking and the securities MTS, asking for specific metrics like MAU and transaction volume, as well as future goals for the digital business.

Answer

An executive in charge of digital business stated that the group's super app reached 8.5 million Monthly Active Users (MAU) at the end of the previous year, with a target of 9 million for the current year. The strategy is to integrate all group services, including card and securities, into the app to attract new customers and launch new financial products via the platform within the year.

Doosan Baek from Korea Investment & Securities asked for an assessment of the IT governance reforms and for details on the strategy for the upcoming 'new WON' banking app, particularly concerning user acquisition and sales.

Answer

CDO Oak Il-Jin reported positive internal feedback on the IT governance reform, citing a 70% satisfaction rate and expecting visible results within the year. He confirmed the 'new WON' app is set to launch in November as a universal platform for the group, designed to consolidate traffic and integrate services like an AI banker and MyData-based products.

Baek Doosan from Korea Investment & Securities Co., Ltd. asked for an assessment of the IT governance reforms and inquired about the strategy for the upcoming 'new WON' banking app, particularly concerning user acquisition and sales.

Answer

CDO Oak Il-Jin reported positive early results from the IT governance reform, with internal surveys showing improved development speed and satisfaction. He stated the 'new WON' app is on track for a November launch and will serve as a universal app for the group, aiming to consolidate traffic and provide seamless services, including an AI banker and MyData-based products.

Doosan Baek from Korea Investment & Securities asked for an assessment of the recent IT governance reform and the strategy for the upcoming 'new WON' banking app, particularly concerning user acquisition and sales.

Answer

CDO Oak Il-Jin reported positive results from the IT governance reform, noting improved development pace and satisfaction, with more visible results expected within the year. He explained the 'new WON' app, launching in November, will serve as a universal platform for the group, concentrating traffic and offering seamless services, including an AI banker and MyData-based products.

Asked about the factors impacting the net interest margin (NIM) in the current quarter and the group's NIM prospects going forward, considering maturing deposits and rising market rates.

Answer

The CFO, Lee Sung-Wook, explained that the Q3 NIM decreased by 4 bps to 1.55% due to the withdrawal of low-rate Iran deposits, higher funding rates, and a lower proportion of core deposits. He expects continued downward pressure but aims to minimize the decline through a focus on higher-interest corporate loans. The Q4 NIM is expected to see a more modest decrease, and the target for 2024 is to maintain it around 1.5%.

Doosan Baek of Korea Investment & Securities asked for more details on the compensation plan designed to support the value-up program, specifically inquiring about the incentives for management and employees tied to RoRWA and other value-up KPIs.

Answer

CFO Jae Kwan Kim responded that the linkage between the value-up program's goals and executive compensation will be strengthened next year. He emphasized that these performance metrics, including RoRWA, will be expanded beyond management to sales staff by redesigning KPIs to ensure company-wide alignment with the new strategic paradigm.

Doosan Baek from Korea Investment & Securities asked about the underlying factors for the lackluster performance in real estate trusts, including any PF-related issues, and how the company plans to respond to the government's upcoming 'Value-up Program' guidelines.

Answer

An executive stated that the real estate trust performance was impacted by certain sites requiring responsible construction, for which provisions were conservatively made. In response to the 'Value-up Program,' the company highlighted its new shareholder return policy, featuring an evenly paid quarterly dividend totaling KRW 1.2 trillion annually, supplemented by share buybacks to enhance DPS and total shareholder return.

Doosan Baek of Korea Investment & Securities asked about the reasons for the poor short-term trading results at Shinhan Investment Securities and requested more details on the timing and allocation of the new share buyback program.

Answer

An executive explained the KRW 300 billion share buyback will occur over six months to ensure flexibility, with a potential for another sizable buyback in Q4. CFO Sang-Hyuk Jung attributed the sluggish trading performance to a high base effect from Q1 2023, a conservative strategy amid market uncertainty, and preemptive loss recognition on certain acquisition financing assets.