Hana, Woori rush to contain martial law fallout

Seen above are headquarters of Hana Financial Group and Woori Financial Group. Courtesy of each firm

Hana Bank and Woori Bank are rushing to contain the fallout of the martial law fiasco, in line with financial authorities’ recommendation of swift responses to limit financial market spillovers, market watchers said Tuesday.

The remaining three of the country’s top five commercial lenders — KB Kookmin, Shinhan and NH NongHyup — have yet to outline plans.

Hana said it maintains close communication with key offshore financial authorities, central banks and investors to reassure them of the country’s economic and financial stability as well as overall resilience of the financial markets.

It communicated with financial authorities in the U.S., U.K., Germany and Singapore, Wednesday, hours after martial law was lifted. The lender has since maintained close communication channels and operated around-the-clock hotlines with the authorities.

It sent letters to offshore shareholders. Key Hana executives held virtual meetings with investor groups, in a show of commitment to the Corporate Value-up drive.

“We will do our best as a mediator of stable finances for businesses and investors,” Hana Financial Group Chairman Ham Young-joo said.

Hana’s New York branch reached out to the Federal Reserve Bank of New York and the New York Department of Financial Services and agreed to maintain close communication to inform them of the latest developments and shared risk management plans.

Similar meetings were organized by Hana's London branch officials with the Prudential Regulation Authority under the Bank of England, while its German branch officials met with their counterparts at the Federal Financial Supervisory Authority and Bundesbank.

Hana’s Hong Kong and Singapore branch officials met with financial authorities.

Hana Financial said the value-up program announced in October will remain intact, underpinned by stable common equity Tier 1 (CET1) ratio by the end of the year.

Hana said in October that the ratio, a measure of a financial firm’s soundness, is expected to soar to a range of between 13 percent and 13.5 percent. It will maintain its return on equity at over 10 percent.

These were part of a group-wide effort to raise Hana’s shareholder returns to 50 percent by 2027, aided by improved earnings per share and greater dividends.

Woori said its foreign currency liquidity is under close monitoring, including the regulatory authorities' Liquidity Coverage Ratio (LCR).

“No signs of irregularities or stress events have been reported, including an unusual wave of foreign currency withdrawals," a Woori official said.

"Spreads on bank-issued bonds are at a healthy level. Monitoring will be strengthened on sectors with greater exposure to foreign exchange volatilities.”