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Shinhan Financial chief eyes M&As overseas

Cho Yong-byoung, chairman of Shinhan Financial Group, said Monday that he would eye M&A opportunities in Asia and the US market as part of the group’s growth strategy to become a leading financial institution in Asia by 2020.

Cho took office as the chief of the largest financial group in South Korea on Thursday, vowing to widen the market gap against the second-largest KB Financial Group in banking and credit card sector, as well as to enhance the growth of other Shinhan subsidiaries.

Cho Yong-byoung, chairman of Shinhan Financial Group, speaks at a press conference in Seoul, Monday. (Shinhan Financial Group)
Cho Yong-byoung, chairman of Shinhan Financial Group, speaks at a press conference in Seoul, Monday. (Shinhan Financial Group)

“I will seek opportunities in M&A, joint venture and equity investment in global markets that have high potential for growth,” Cho said at a press conference in Seoul.

He did not specifically mention which market he was currently watching but said it will be either in Asia or the US.

“We have our Asian financial belt which includes Uzbekistan, Kazakhstan, China, Japan, Indonesia, India, Kuwait and Myanmmar. Our overseas bank branches have strong platforms and we will find ways to share our client base with our other affiliates, too.”

Shinhan Financial currently has 165 subsidiaries or branches in 20 countries, mostly in Asia, according to the group.

Cho said he will push the financial group’s return on equity, or ROE, into double digits by 2020 from the 9.2 percent at the end of 2016, as leading financials in China and Japan have two-digit ROEs. ROEs show a company’s profitability by signaling how much profit the firm generates with the money shareholders have invested.

To make the group more profitable, he will put more eight on non-banking financial service than on banking.

“Korean financial groups have weak ‘DNA’ in capital markets because they’re banking-centered. I have already expanded the workforce of capital market experts in banking to enhance wealth management business,” he said.

Cho also said he planned to accelerate digitalization in sales, marketing and product innovation.

He also mentioned about Shinhan’s rival KB Financial, calling it a “very good competitor.”

When the first-quarter earnings of Shinhan and KB come out later, the two will be able to find out about each other’s capability, he said.

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