[비즈한국] Hana Financial Group086790 is focusing on shareholder returns after achieving record-breaking earnings. Hana Financial Group retired 400 billion KRW worth of treasury shares last September and plans to purchase and retire an additional 200 billion KRW worth by October 24. Nevertheless, with the securities industry evaluating Hana Financial Group’s shareholder return rate as lower than expected, financial circles are focused on whether the group will implement further shareholder returns for the remainder of the year.
According to the Financial Supervisory Service's electronic disclosures, Hana Financial Group's net profit increased by 11.31% from 2.0871 trillion KRW in the first half of last year to 2.3232 trillion KRW in the first half of this year. This is the highest net profit for a first-half period on record. Hana Financial Group explained that these results were driven by flexible responses to market volatility, diversification of profit portfolios, company-wide cost efficiency, and proactive risk management.
Building on these earnings, the group is also strengthening shareholder returns. Hana Financial Group retired 400 billion KRW worth of treasury shares last September and plans to purchase and retire an additional 200 billion KRW worth by October 24.
However, some shareholders argue that the shareholder returns have fallen short of expectations. Jeong Tae-joon, an analyst at Mirae Asset Securities006800, stated, "Hana Financial Group announced a 200 billion KRW share buyback and retirement plan to be completed by October 24, which fell below previous estimates (350 billion KRW). While there remains a possibility of announcing additional buyback and retirement plans during the third-quarter earnings call, uncertainty persists due to the recent rebound in the KRW/USD exchange rate."
Analyst Jeong explained that depending on the circumstances, Hana Financial Group's shareholder return rate for this year could remain at only 42%. The shareholder return rate is the sum of dividends and treasury share buybacks/retirements divided by the company's net profit. The securities industry expects the shareholder return rate for KB Financial Group105560 to exceed 50%, and forecasts a return rate in the mid-40% range for Shinhan Financial Group as well. Analyst Jeong Tae-joon stated, "We expect Shinhan Financial Group's shareholder return rate to reach 46.4% this year."
Some in the securities industry are anticipating additional share buybacks and retirements from Hana Financial Group. If Hana Financial Group announces further plans, it could reach a shareholder return rate similar to that of Shinhan Financial Group. Kim Do-ha, an analyst at Hanwha Investment & Securities003530, analyzed, "Considering that the share buyback period announced by Hana Financial Group runs until October, I judge that the likelihood of deciding on a third round of share buybacks within the year has increased. If we assume an additional 100 billion KRW buyback in the fourth quarter, the shareholder return rate is expected to rise to 45.1%."
Hana Financial Group has not released any further shareholder return plans since the announcement of the 200 billion KRW buyback and retirement in July. Given the remaining time this year, some forecast that additional share buybacks in the hundreds of billions of won will not be easy.
Some analysts suggest that Hana Financial Group is adjusting its pace. Rather than raising the shareholder return rate all at once, the strategy is to increase it gradually from a long-term perspective. Ham Young-joo, Chairman of Hana Financial Group, has set a goal of "achieving a 50% shareholder return rate by 2027." With Chairman Ham's term running until March 2028, he still has more than two years left. There is no urgent need to rush the shareholder return rate to 50% this year.
Furthermore, an unconditional increase in the shareholder return rate is not always positive. Increased spending on shareholder returns could reduce the funds available for investment. While Hana Financial Group has recorded record-breaking performance this year, there is no guarantee that this trend will continue next year.
On the other hand, there are high expectations that Hana Financial Group will announce additional shareholder return policies. If the group's shareholder return rate remains in the low 40% range this year, comparisons with KB Financial Group or Shinhan Financial Group are inevitable. The fact that President Yoon Suk-yeol has emphasized shareholder returns could also act as pressure on Hana Financial Group.
A Hana Financial Group official stated, "We are actively expanding shareholder returns this year in accordance with our corporate value enhancement plan. We are also considering the implementation of additional shareholder return expansions in the second half of the year, taking into account group business performance and financial market environments such as interest rates and exchange rates."