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Local financial groups are likely to face a fiercer battle in the non-banking sector as their leaders are placing top priority on beefing up their competitiveness in the sector in the second half of 2019.
During Shinhan Financial Group's management meeting, Chairman Cho Yong-byung stressed the importance of enhancing the group's non-banking businesses to become Asia's leading bank
"We shouldn't settle for the status quo," he said.
"Shinhan has just retaken the nation's leading bank position. It is essential for a financial firm to closely monitor its profitability and financial soundness. Keep eyeing these two pillars."
In a bid to maintain the nation's leading bank position, a Shinhan Financial Group official said Cho emphasized the group's digitalization and non-banking businesses as its future growth engine.
"Cho is considering the possibility that the group's businesses could not be as favorable as its earnings last year," he said. "He also encouraged heads of the group's subsidiaries to fulfill their own goals to become Asia's leading bank."
Shinhan Financial Group's earnings from non-banking businesses accounted for about 44 percent of its total earnings in 2017, but the figure slid below the 40 percent mark in 2018.
Its global business accounted for only 5.7 percent of the group's total earnings in 2016. The group managed to stretch the figure to 10.8 percent last year, but still has a long way to reach its target figure of 20 percent.
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| Woori Financial Group Chairman Sohn Tae-seung speaks during the group's in-house conference at the Grand Hilton Hotel In Seoul, Friday. / Courtesy of Woori Financial Group |
During the group's in-house conference at the Grand Hilton Hotel in Seoul. Friday, he suggested the group raise the figure to 40 percent by 2023.
He said the group will expand its capital and asset management business while actively looking for M&A and initial public offering opportunities. Utilizing the group's overseas networks in 26 countries, he promised to enhance the group's global businesses.
On his 100th day in the office, KEB Hana Bank CEO Ji Sung-kyoo also stressed the bank will seriously look for M&A opportunities to enhance its non-banking sector in the second half of the year.
The bank plans to spend about 1.5 trillion won ($1.27 billion) for M&A this year to strengthen its business portfolio, he added.
He also said KEB Hana will enhance its market presence in India, Japan and Indonesia in the second half.
