Yuanta Securities Raises Hana Financial's Target Price to 170,000 Won

Yuanta Securities has raised its target price for Hana Financial Group by 3% to 170,000 won while maintaining a "buy" rating. This adjustment is based on expectations that Hana Financial will continue to show strong performance driven by improvements in net interest margin (NIM) and increased shareholder returns.

Woo Do-hyung, a researcher at Yuanta Securities, stated, "Hana Financial's second-quarter net income attributable to shareholders is expected to reach 1.2227 trillion won, aligning with market consensus." He added that interest income is projected to increase by 1.2% from the previous quarter due to a rise in won-denominated loans and improvements in bank NIM.

The bank's NIM is anticipated to rise by 3 basis points from the previous quarter to 1.61%. Non-interest income is also expected to grow by 11.4% compared to the previous quarter, bolstered by improved fee income.

However, the provision for the Chungang Group remains a concern. Yuanta Securities estimates Hana Financial's exposure to the Chungang Group at 400 billion won, with a projected provision of 50 billion won for the second quarter.

The capital soundness of Hana Financial is expected to remain stable. Although the Common Equity Tier 1 (CET-1) ratio may decline slightly due to investments in Dunamu, it is projected to be managed at around 13%. After applying operational risk mitigation, an improvement effect of about 10 basis points is expected in the third quarter.

Woo noted, "The target price increase is due to upward revisions in profit estimates following the rise in NIM and improvements in return on equity (ROE)." He also forecasted a total shareholder return rate of 50.6% for 2026, with an expected total shareholder return yield of 6.9% (3.7% from dividends and 3.1% from share buybacks) by the end of this year.