2Q 2011

Hana Financial Group

Business Results

Contents
2Q11 Financial Highlights
Profitability
Total Lending & Funding
Asset Quality & Capital Adequacy
Appendix

2Q11 Financial Highlights

Group Net Income
Unit : Wbn
QoQ
+ 27.3%

YoY
+ 177.3%

483
379

K-IFRS
: 200

Unit: Wbn

Quarterly NIM

2.31%
2.26%

2.24%

6.5

2.24%

2.10%

483

1Q10

1Q11

-8.8

K-GAAP

K-IFRS

2Q10

2Q11

2Q11

Bank

2Q10

3Q10

0.65%

0.72%
0.61%

1Q11

4Q10

1Q11

1.50%

0.36%

1Q11

2Q11

-3.9

-12.2

-23.3

2Q11
Bank

NPL Formations

1.57%

1.37%

0.52%

2Q11

K-IFRS

Unit: Wbn

1.22%

0.58%

559
396

0.70%
0.57%

K-IFRS

K-GAAP
3Q10

4Q10

0.42%
0.55%

4Q10

Delinquency

1.45%
0.66%

3Q10

-10.1

K-IFRS

NPL/ Delinquency Ratios

NPL

0.76%

2Q10

K-GAAP

Bank

Credit Cost
Group

2Q10

K-GAAP

174
K-IFRS

Hana SK Card Net Income

Group Quarterly NIM

0.54%
K-GAAP

2Q10

3Q10

261

0.60%
0.49%
K-IFRS

4Q10

1Q11

2Q11

K-GAAP
2Q10

3Q10

208

113
K-IFRS

4Q10

1Q11

2Q11

1. Include Write-off & NPL Sales

Profitability
Group Consolidated Earnings
Business Results of Subsidiaries
NIM
Non Interest Income / SG&A Expense
Hana SK Card

Group Consolidated Earnings

Group Consolidated Income Statement
2Q11

1Q11

K-IFRS
Gen. Op Income
Int. Income

Unit: Wbn

1H11

1H10

K-IFRS

K-GAAP

1,276

1,153

2,429

1,959

800

760

1,560

1,399

Group Core Income Trend

693

Fee Income

250

227

477

432

Disposition
/ Valuation

268

166

434

209

Other Income

-42

-41

-82

506

460

966

866

SG&A (-)
PPOP
Provision (-)
Operating
Income
Net Income

Unit: Wbn

[Interest + Fee Income]

671

757

860

899

932

968

2Q

3Q

4Q

1Q10

2Q

1,050

892

K-GAAP
1Q09

987

3Q

4Q

K-IFRS
1Q11 2Q11

Main Factors QoQ

770
87

693
172

1,463
259

QoQ
Int. Income

NIM +7bp

Fee Income

Card Sales & Securities Fee

Income up

Disp. / Val.

Gain on Sale of Hyundai E&C

137.4 Wbn (after-tax)

Other Income

Dividend gains down

SG&A

Provision

1,093
434

683

520

1,204

658

483

379

862

475

Main Factors

Benefit Pmt UP (Bank Incentive

30.9 Wbn)
2Q10 Bank Incentives 16.3 Wbn
Asset Soundness improved
(Net Defaults down)
5

Business Results of Subsidiaries

Net Income of Subsidiaries
2Q11

1Q11

K-IFRS
Hana Bank

476.9

Unit: Wbn

1H11

K-IFRS K-GAAP

394.7

871.6

Hana Daetoo Securities

1H10

450.3

%
100.0%

6.2

3.5

9.7

6.5

100.0%

PT Bank Hana

1.3

0.5

1.8

1.2

75.1%

Hana Daetoo
Securities

33.2

Hana Capital

12.4

10.7

23.1

15.8

50.1%

Hana SK Card

6.5

-3.9

2.7

-23.4

51.0%

Hana Daol Trust

2.5

1.3

3.7

5.3

58.0%

0.3

0.3

0.3

100.0%

0.1

-0.4

-0.3

0.0

100.0%

57.4

114.5

[Brokerage_Stock Volume]
: Wtn

Unit: Wbn

Hana Bank China

24.3

[Wrap Account AUM]

100.0%

QoQ
+ 29.3%

YoY
+ 20.9%

3,525
1,574

1,728

2Q10 3Q

4,559

34.5

1,933

4Q 1Q11

2Q

2Q10

41.7

2Q11

Hana SK Card

Hana Institute of
Finance
Hana INS
Consolidated
Adjustment

-56.5

-52.0

-108.4

-95.8

Group Consolidated
Net Income

482.6

379.0

861.6

474.7

Unit: Wbn

[General Operating Income]

70.4
29.1

32.2

47.9

61.7

K-GAAP
2Q10

3Q10

K-IFRS
4Q10

1Q11

2Q11
6

NIM
Group Quarterly NIM & Interest Income
K-GAAP NIM

Unit: Wbn

Interest Income

K-IFRS NIM

NIM Factors
2Q10

3Q10

4Q10

1Q11

K-GAAP

K-IFRS

2.31%

2.26%

2.24%

2.24%

2.10%

715

2Q11

CD(3M)

2.47%

2.62%

2.73%

3.14%

3.46%

Debentur
es (1Y)

3.13%

3.38%

3.17%

3.67%

3.73%

Lending
Rate

5.49%

5.21%

5.29%

5.30%

5.50%

Funding
Rate

3.34%

3.20%

3.16%

3.17%

3.29%

Mkt

728

800

760

684
NIS
K-GAAP

2Q10

3Q10

K-IFRS
4Q10

1Q11

2Q11

Bank Quarterly NIM & Interest Income

K-GAAP NIM

K-IFRS NIM

Unit: Wbn

Interest Income

1.99%

NIS (New Loans & Deposits)

5.24%

1.98%
1.93%

1.92%

5.34%

1.82%

199bp
672

657

632

3Q10

5.62%

5.54%
187bp

189bp

219bp

706

683

3.14%

K-GAAP
2Q10

New Funding rate1)

New Lending rate

3.66%

3.74%

1Q11

2Q11

3.25%

K-IFRS
4Q10

1Q11

3Q10

2Q11
1)

4Q10

Time Deposit + CD

Non Interest Income / SG&A Expense

Non Interest Income
Unit: Wbn

2Q11

1Q11
K-IFRS

Fee Income

1H11

1H10

K-IFRS

K-GAAP

249.9

226.9

476.8

432.2

Credit Card
Beneficiary Certificate
Sales
Brokerage

81.8

68.1

150.0

140.4

36.5

36.8

73.3

81.4

45.0

44.4

89.4

74.3

FX

13.1

13.8

26.9

25.2

Bancassurance

22.4

20.7

43.1

29.9

Other

51.1

43.1

94.1

81.0

Disposition / Val.

268.1

165.6

433.7

208.7

Other Income

-41.9

0.6

-41.3

-81.7

Total

476.0

393.1

869.1

559.2

Group Non Interest Income Trend

Unit: Wbn

393
271
231

192
K-GAAP

2Q10

3Q10

Unit: Wbn

2Q11

1Q11
K-IFRS

Salary & Benefits

Retirement Benefits
Administrative Expense
Tax / Depreciation
Total

213.9

188.8

1H11

1H10

K-IFRS

K-GAAP

402.7

K-IFRS
4Q10

1Q11

47.2%

46.3%

SG&A Expense

46.7%

39.9%

350.6

14.1

24.4

38.5

33.3

217.5

185.7

403.2

352.5

60.4

61.3

121.7

129.5

505.8

460.3

966.1

866.0

2Q11

C/I Ratio Trend

C/I Ratio ()

SG&A Expense

476

446

445

481

3Q10

4Q10

39.8%

506
460

K-GAAP
2Q10

Unit: Wbn

1Q11

K-IFRS
2Q11
8

Hana SK Card
Net Income

Sales
Unit: Wbn

Unit: Wbn

QoQ
+ 13.1%

6.5
1Q10

2Q10
3Q10
K-GAAP

-8.8

4Q10

-10.1

1Q11

2Q11
K-IFRS

7,492

-3.9

-12.2
-23.3

4,629
2Q10

Total Credit CardHolders

5,301
3Q10

6,488

4Q10

6,627

1Q11

New Credit Cardholders

Unit: Thousand

Unit: Thousand

QoQ
+ 3.3%

QoQ
+12.1 %

315

4,408
3,905
2Q10

4,045

3Q10

4,147

4,267

1Q11

281

273
248

4Q10

2Q11

2Q11

2Q10

237
3Q10

4Q10

1Q11

2Q11

Total Lending & Funding

Group Total Lending / Funding
KRW Loans / Deposits (Bank)

10

Group Total Lending / Funding

Group Total Lending
Unit: Wbn
2Q 2011

%
K-IFRS

Cash & Deposits

1Q 2011

4Q 2010

K-IFRS

K-GAAP

9,772

5.7%

10,365

8,688

27,720

16.2%

28,659

28,255

119,300

69.5%

115,481

110,848

KRW Loans

95,354

55.6%

94,442

91,627

Tangible Assets

1,435

0.8%

1,476

1,295

Other Assets

13,388

7.8%

12,124

9,440

Total Assets

171,615

100.0%

168,105

158,525

Securities
Loans

Unit: Wbn
%
K-IFRS

1Q 2011

4Q 2011

K-IFRS

K-GAAP

Deposits

97,448

56.8%

94,008

96,397

Borrowings

40,533

23.6%

38,842

36,837

Borrowings

9,092

5.3%

9,023

7,653

Debentures

25,530

14.9%

23,283

21,019

5,911

3.4%

6,536

5,353

RP, Call Money,

etc
Other Liabilities
Total Liabilities
Shareholders Equity
Total Liab. & S.E.

18,776

10.9%

20,712

13,919

156,758

91.3%

153,562

147,154

14,856

8.7%

14,543

11,371

171,615

Unit: Wtn

158

162

168

100.0%

168,105

158,525

2Q10

3Q10

172

159

K-GAAP

Group Total Funding

2Q 2011

Group Total Assets

K-IFRS
4Q10

1Q11

2Q11

Group Total Equity

Unit: Wtn

10.8

11.2

11.4

14.5

14.9

1Q11

K-IFRS
2Q11

K-GAAP
2Q10

3Q10

4Q10

11

KRW Loans / Deposits

KRW Loans (Bank)
Unit: Wbn
2Q 2011

%
K-IFRS

Corporate

1Q 2011

4Q 2010

K-IFRS

K-GAAP

41,406

44.6%

41,482

39,582

Large. Corp

11,471

12.4%

11,694

10,229

SME

29,935

32.3%

29,788

29,353

(SOHO)

9,513

10.3%

9,354

9,260

Household

49,911

53.8%

49,082

48,746

Secured

40,241

43.4%

39,605

39,083

(Mortgage)

29,662

32.0%

29,450

29,251

Unsecured

9,670

10.4%

9,477

9,663

Public & Other

1,467

1.6%

1,455

1,250

92,784

100.0%

92,020

89,578

Total

Deposits (Avg. Basis)

%
K-IFRS
KRW Deposits

Unit: Wtn

+1.2

89.6

+3.2 Wtn (3.6%)

1Q 2011

4Q 2010

K-IFRS

K-GAAP

Low Cost Deposits

Core Deposits

MMDA

28.2%
26.4%
26.0%

26.1%

90,835

87,567

12,556

13.4%

12,646

11,675

MMDA

13,959

14.9%

13,712

11,934

23.4

Time Deposits

59,668

63.7%

59,234

54,161

11.4

11.8

Demand Deposits

2,803

3.0%

2,859

3,854

CD

2,019

2.2%

2,384

5,943

12.0

12.3

2,723

2.9%

2,604

3,294

93,728

100.0%

93,439

90,861

Total

92.8

1H11

2010

97.1%

FC Deposits

+0.6

+0.2

Public
SME
&
Others
Large
Household
Corp

91,005

Core Deposits

+1.2

Low Cost Deposits (Core Deposits + MMDA)

Unit: Wbn

2Q 2011

KRW Loan Growth (1st Half)

Unit: Wtn

28.3%
26.5

26.3
12.5

24.1

23.6

12.6

11.7
11.9

13.7

K-GAAP
2Q10

3Q10

4Q10

1Q11

14.0
K-IFRS
2Q11
12

Asset Quality
& Capital Adequacy
Group Asset Quality
Bank Asset Quality
Provision
Capital Adequacy

13

Group Asset Quality

Group
Unit: Wbn

2Q 2011

3Q 2011
K-IFRS

Group NPL / Precautionary & Below Ratios

4Q 2010

NPL

K-GAAP

Precautionary & Below

3.38%

Total Credits
Normal
Precautionary

123,965

120,410

116,585

120,867

116,889

112,980

1,480

1,536

1,728

Substandard

994

1,281

1,281

Doubtful

431

473

403

Estimated Loss

193

231

194

1,618

1,986

1,878

1.31%

1.65%

1.61%

118.0%

104.4%

106.5%

1,909

2,073

2,000

1,182

1,385

2,000

727

688

NPL Amount
NPL %

3.13%

1.42%

1.51%

3.10%

1.61%

2.92%

2.50%

1.65%

1.31%
K-GAAP
2Q10
3Q10

4Q10

K-IFRS
1Q11
2Q11

Group NPL Coverage Ratio

118.0%
112.4%

NPL Coverage %
Loan Loss
Allowance
LLR
Bad Debt
Reserves

106.9%

106.5%

104.4%

K-GAAP
2Q10

3Q10

K-IFRS
4Q10

1Q11

2Q11
14

Bank Asset Quality

Bank
Unit: Wbn

2Q 2011

1Q 2011
K-IFRS

Total Credits

111,889

Bank NPL / NPL Coverage Ratios

4Q 2010
NPL

K-GAAP
110,410

108,590

Coverage Ratio

111.4%
106.1%

118.1%

106.2%
103.0%

Normal
Precautionary

109,185

107,295

105,359

1,338

1,382

1,607

1.57%
1.45%

1.37%

Substandard

917

1,193

1,186

Doubtful

294

346

278

Estimated Loss

154

195

160

1,366

1,733

1,624

1.22%

1.57%

1.50%

118.1%

103.0%

106.2%

NPL Amount
NPL %

1.50%
1.22%

K-GAAP
2Q10

3Q10

4Q10

K-IFRS
1Q11
2Q11

Delinquency Trend
Corp.

Total

Household

1.02%
0.76%

0.76%

0.87%

0.70%

NPL Coverage
Loan Loss
Allowance
LLR
Bad Debt
Reserves

1,613
907
706

1,785
1,112
673

1,725

0.54%

0.61%
0.49%

0.36%

0.33%

0.29%

0.31%

0.36%

2Q10

K-GAAP
3Q10

4Q10

1Q11

K-IFRS
2Q11

1,725
-

0.60%

0.57%

* Delinquency: Excluding Loan Sales & write-offs

15

Provision
2Q11 Group Provision Overview
Credit Cost
0.76%

Bank NPL Formations1

Unit: Wbn

Provision

Unit: Wbn

0.66%

0.65%

0.57%

0.42%

559

267
132

194

3Q10

208

4Q10

1Q11

2Q11

K-GAAP
2Q10

Unit: Wbn

2Q10
(Wbn)

0.52%
0.36%

252
104

105

143
58

K-GAAP
2Q10

3Q10

K-IFRS
4Q10

4Q10

1Q11

2Q11

Bank Write-offs / Loan Sales

0.72%
0.55%

K-IFRS

3Q10

1. Include Write-off & NPL Sales

Provision
0.61%

113

K-IFRS

2Q11 Bank Provision Overview

Credit Cost

261

87

K-GAAP
2Q10

396

172

1Q11

* Credit Cost = Annulized provision expense / estimated year end

total credits (ending balance basis)

2Q11

3Q10

4Q10

1Q11

K-GAAP

2Q11

K-IFRS

Total

80.1

349.1

186.8

99.1

514.4

Writeoffs

78.3

61.5

71.3

99.1

204.2

Loan
Sales

1.8

287.6

115.5

310.2

16

Capital Adequacy
Group Capital Adequacy Ratios

Bank Capital Adequacy Ratios

13.71%(E)

15.33%
15.73%

13.43%

BIS Ratio

14.04%

12.38%
12.00%

14.12%(E)

11.81%

13.84%

12.54%
11.96%

10.71%

10.36%(E)

Tier1 Ratio
9.15%
8.65%

10.28%(E)

10.11%
10.05%

8.63%
16,265

16,746

Unit: Wbn

14,305

14,408

3,925

3,853

3,759

10,152

10,452

10,648

14,077

4,016

2,612

12,250

K-GAAP
2Q10
Tier I

Tier II

4,098

11,877

12,648

9,265

K-IFRS
3Q10

4Q10

1Q11

2Q11

11,899
2,412

9,487

11,487
10,408

11,012

2,467

3,017

7,942

7,995

K-GAAP
2Q10
Tier I

3Q10

3,125

8,362

K-IFRS
4Q10

1Q11

2Q11

Tier II
17

Appendix
Group Major Indices
PF Real Estate
Dividend Overview

18

Group Major Indices

2Q11

1H11

2010

K-IFRS

1H10
K-GAAP

ROA

1.19%

1.09%

0.64%

0.62%

ROE

14.13%
(16.04%)1

13.35%
(14.57%)1

9.95%

9.71%

EPS(KRW)

1,982

3,681

4,829

2,268

BPS(KRW)

56,234

56,234

50,996

48,039

39.7%

39.8%

46.7%

44.2%

C/I Ratio
(Annualized)

1. Exclude capital raise

19

PF Real Estate
PF Exposure

Provision / NPL Coverage ratio

Unit: Wbn

Coverage Ratio

Unit: Wbn

Provision
90.2%

93.56%
70.81%
54.57%
51.29%
2,662

2Q10

2,578

3Q10

200
2,569

4Q10

2,551
1Q11

2,178

79

2Q11

2Q10

123

135

3Q10

4Q10

NPL
NPL Ratio

8.74%

1Q11

Unit: Wbn

Delinquency Ratio

11.07%

225

263

3Q10

85
58

84
2Q10

0.86%

283

1.16%

1.11%

3.20%

Unit: Wbn

Delinquency Amount
3.31%

2.25%
3.17%

2Q11

Delinquency

NPL Amount
10.24%

63

4Q10

1Q11

70

23

29

2Q11

2Q10

3Q10

25
4Q10

1Q11

2Q11

20

Dividend Overview
2006
Interim
Dividend per share (KRW)
Dividend Amt (Total)
Net Income (Cumulative)
Payout Ratio (Total)

Payout Ratio

2007

Year End

350

550

188.7 Wbn

Interim

Year End

500

800

Interim

1,298.1 Wbn

18.4%

21.2%

2009

Year End

100

275.4 Wbn

1.026.7 Wbn

Net Income

2008

100

2010

Interim

Year End

400

Interim

Year End

300

400

42.0 Wbn

83.7 Wbn

146.5 Wbn

483.4 Wbn

306.3 Wbn

1,010.8 Wbn

8.7%

27.3%

14.5%

Unit: Wbn

Total Dividend Amt

27.3%
21.2%

18.4%
14.5%

8.7%

1,298

1,027

1,011
483

306

275

189

147
84

42
2006

2007

2008

2009

2010
21