South Korean financial firms pursue profitability and shareholder returns

South Korean financial institutions are implementing strategic shifts to enhance profitability and shareholder value.

Hyundai Motor Securities reported a 48.3% increase in net profit for the first half of the year, reaching 59.3 billion won. To improve its Return on Equity (ROE), the firm is diversifying its revenue streams by establishing a new corporate finance division, strengthening retirement pension services (DC and IRP), and integrating AI-driven private banking and digital services. The company aims to gradually increase its ROE to over 10% by 2028.

Shinhan Financial Group achieved a record net profit of 3.44 trillion won in the first half of the year, a 13.3% increase year-on-year. Leveraging its strong Common Equity Tier 1 (CET1) ratio of 13.43%, the group has expanded its shareholder return program, including a plan to acquire 1.4 trillion won in treasury shares by October. The group is also targeting a steady increase in dividends, aiming for a 10% annual growth in dividends per share over the next three years.