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    Jaewoong Won • HSBC Securities

    Jaewoong Won's questions to Shinhan Financial Group Co Ltd (SHG) leadership

    Jaewoong Won's questions to Shinhan Financial Group Co Ltd (SHG) leadership • Q1 2025

    Question

    Jaewoong Won asked for an updated full-year outlook on Net Interest Margin (NIM) following its unexpected rise in Q1, and questioned the significant drop in the NPL coverage ratio, seeking clarity on whether it has bottomed out.

    Answer

    Shinhan Bank CFO Jeongbin Lee explained that while Q1 NIM improved due to lower funding costs, the full-year expectation remains a decline due to falling market rates. Group CFO Sang Yung Chun and Group CRO Dong-kwon Bang addressed asset quality, stating the NPL coverage ratio drop was a strategic choice due to unfavorable NPL sales conditions. They affirmed the Q1 level is likely the bottom and projected a significant recovery to around 200% by year-end.

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    Jaewoong Won's questions to Shinhan Financial Group Co Ltd (SHG) leadership • Q1 2025

    Question

    Jaewoong Won inquired about Shinhan's full-year Net Interest Margin (NIM) outlook, noting the unexpected 5 bps increase in Q1, and questioned the significant drop in the NPL coverage ratio, asking if further declines are expected.

    Answer

    Shinhan Bank CFO Jeongbin Lee explained that Q1 NIM benefited from lower funding costs and core deposit inflows but expects a decline for the full year due to falling market rates. Group CFO Sang Yung Chun and Group CRO Dong-kwon Bang addressed asset quality, stating the NPL coverage ratio drop was due to a strategic reduction in NPL sales in an unfavorable market. They affirmed that Q1 represents the bottom and expect the ratio to recover to 200% by year-end.

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    Jaewoong Won's questions to Shinhan Financial Group Co Ltd (SHG) leadership • Q4 2024

    Question

    Jaewoong Won from HSBC noted the aggressive shareholder return policy and questioned its sustainability as earnings grow. He also asked for an outlook on net income and NIM, given the expected decline in credit costs.

    Answer

    Group CFO Sang-Hyuk Jung responded that the shareholder return policy is not aggressive but is aligned with their pre-disclosed corporate value plan. He explained that Q4 earnings were impacted by conservative, upfront provisioning for real estate PF and overseas assets. For the upcoming year, he anticipates a significant earnings improvement of KRW 1.4-1.5 trillion due to the base effect from these one-off provisions, which will support the shareholder return policy and a target CET1 ratio of 13.1%.

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    Jaewoong Won's questions to Woori Financial Group Inc (WF) leadership

    Jaewoong Won's questions to Woori Financial Group Inc (WF) leadership • Q1 2025

    Question

    Jaewoong Won from HSBC asked if Early Retirement Program (ERP) costs would consistently be a Q1 event and questioned how the 12.5% CET1 ratio target balances with the 4-5% loan growth target, especially given the negative growth in the current quarter.

    Answer

    A Woori Financial Group executive clarified that the timing of ERP costs is variable and depends on negotiations, not fixed to Q1. Regarding the CET1 ratio, the executive stated that achieving the 12.5% target is the top priority. Loan growth will be managed to ensure this target is met, potentially being constrained if FX volatility persists, with the CET1 ratio taking precedence over growth.

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    Jaewoong Won's questions to Woori Financial Group Inc (WF) leadership • Q1 2024

    Question

    Jaewoong Won from HSBC Securities asked about Woori's overseas M&A strategy, including target regions, and whether the group is considering fintech investments as an alternative way to diversify its non-bank portfolio.

    Answer

    CFO Lee Sung-Wook identified high-growth markets in Southeast Asia and India as the focus for global expansion, noting a planned capital increase for subsidiaries in Cambodia, Vietnam, and Indonesia. CDO Oak Il-Jin added that the fintech strategy centers on strategic alliances and potential equity stakes in sectors like real estate and mobility, as direct M&A is limited by regulations.

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    Jaewoong Won's questions to Woori Financial Group Inc (WF) leadership • Q1 2024

    Question

    Jaewoong Won from HSBC Securities asked about the group's overseas M&A strategy, including target regions or specific candidates, and whether it would consider fintech investments as an alternative path to diversify its non-bank portfolio.

    Answer

    CFO Lee Sung-Wook stated the group is focused on acquiring financial companies in high-growth markets like Southeast Asia and India, though no deals are imminent. CDO Oak Il-Jin added that while direct fintech M&A is limited by regulations, the group actively pursues strategic alliances and equity stakes in sectors like real estate, mobility, and e-commerce to create synergies.

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    Jaewoong Won's questions to Woori Financial Group Inc (WF) leadership • Q1 2024

    Question

    Jaewoong Won from HSBC Securities asked about overseas expansion plans, including specific target countries or candidates, and whether the group is considering fintech investments as an alternative to traditional M&A.

    Answer

    CFO Lee Sung-Wook identified Southeast Asia and India as key focus areas for global expansion, noting recent capital increases for subsidiaries in Vietnam, Cambodia, and Indonesia. CDO Oak Il-Jin added that while direct fintech M&A is limited by regulations, the group is actively pursuing strategic alliances and equity stakes in fintechs related to real estate, mobility, and e-commerce to create synergies.

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    Jaewoong Won's questions to KB Financial Group Inc (KB) leadership

    Jaewoong Won's questions to KB Financial Group Inc (KB) leadership • Q1 2024

    Question

    Jaewoong Won of HSBC Securities requested a breakdown of the CET1 ratio movement, specifically the impact from operational risk and FX rates, and asked for the target levels for the CIR and CCR for the year.

    Answer

    An executive detailed that the CET1 ratio was impacted by ELS provisions (~47 bps) and operational risk (~28 bps), leading to a net 19 bps decline to 13.40%. For the Credit Cost Ratio (CCR), the company expects to maintain a level around 40 bps on a quarterly basis, citing sufficient loss absorption capabilities from prior provisions. A specific target for the Cost-to-Income Ratio (CIR) was not provided.

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