Hana Financial Group Reports Improved Net Profit and Soundness in Q1

Hana Financial Group posted a net profit of approximately 1.2 trillion won in the first quarter, bolstered by an increase in its net interest margin (NIM) and a reduction in bad debt expenses. The group's Q1 performance demonstrated a differentiated trend within the financial sector, achieving both profitability and soundness amid changes in the interest rate environment. Hana Securities interpreted this as a result of 'qualitative improvement'.

The first-quarter results showed a distinct increase in interest income, driven by steady growth in the bank's won-denominated loans and a significant rise in NIM. Non-interest income also improved, benefiting from favorable capital market conditions, leading to an expansion in fee and commission income and maintaining robust overall profitability.

On the cost side, there were one-off factors such as special retirement provisions and increased tax rates, but the growth rate of general and administrative expenses remained limited. Even excluding provisions for bad debts, overall loan loss expenses decreased, confirming sound asset quality management. The collateral-centric loan structure played a role in mitigating risk.

Hana Securities maintained its 'Buy' investment rating for Hana Financial Group's Q1 performance and set a target price of 157,000 won.