Shinhan Financial, Woori profits rise on lending growth

Shinhan Financial Group said its annual net profit rose 17.2 percent in 2016 from a year earlier, mainly due to a growth in lending.

The nation’s largest financial group by asset said in a regulatory filing that its net profit reached 2.7 trillion won last year, the highest figure since 3.1 trillion won in 2011.

In the fourth quarter alone, its net profit surged 51.5 percent on-year to 612.1 billion won.

Most of the net profit came from its banking subsidiary Shinhan Bank. The bank’s annual net profit jumped 30.2 percent on-year to hit 1.94 trillion won last year.

The bank’s loans extended in local currency went up 4.4 percent on-year to 7.74 trillion won in 2016, the bank said. While household lending rose 6.3 percent, corporate loans inched up 2.5 percent, year-on-year.

Shinhan Bank’s net interest margin, a measurement of profitability, fell one basis point to 1.49 percent last year, after the Bank of Korea lowered its base rate in June to a record low of 1.25 percent.

Another major subsidiary Shinhan Card’s net profit increased 3 percent to reach 715.9 billion won in 2016 from a year earlier, the group said.

Shinhan Life Insurance saw its net profit surging 50.2 percent to 150 billion won during the same period. 

Meanwhile, recently privatized Woori Bank also disclosed its 2016 earnings Wednesday and said its net profit rose 19 percent to hit 1.26 trillion won in 2016 from a year earlier.

The net profit volume is the largest since 1.63 trillion won in 2012.

However, in the fourth quarter alone, Woori’s net profit was down 29 percent to 155.4 billion won from a year earlier, the bank said.

The bank attributed the net profit fall to one-time costs which included 86 billion won severance payments and 84 billion won bonuses in the last quarter.

KB Financial Group is to disclose its earnings on Thursday. 

By Kim Yoon-mi (yoonmi@heraldcorp.com)