Hana Financial Investment recapitalizes to apply for mega investment bank status
South Korean company Hana Financial Investment Co. to be recapitalized by 500 billion won ($ 422 million) by selling new shares to parent company Hana Financial Group Inc. to raise equity to more than 4 trillion won and become eligible to join the Mega Investment Category.
Hana Financial Group, the investment holding entity of the financial conglomerate of the same name that owns a 100 percent stake in Hana Financial Investment, said in a public disclosure Tuesday that its board of directors had approved the purchase of 8 , 47 million shares of investment banking unit to 59,000 won a share, valued at a total of 499.73 billion won. Payment is due March 26.
Hana Financial Investment said the same day that its equity would exceed 4 trillion won by the end of March, after reflecting the proceeds of the new rights issue in the first quarter financial statements.
This would allow the brokerage unit to apply for a large investment banking license that would allow the institution to issue banknotes up to a maximum of 200% of its net worth.
The upscaling comes less than a year after the investment unit became a global finance and investment company with capital raised by more than 3 trillion won following the rights issue worth 1,200 billion won.
The investment company posted net profit of 280.3 billion won for all of 2019, up 84.3 percent from the previous year. Its operating profit jumped 77.1 percent year on year to 349.5 billion won, and revenue rose 44.4 percent to 5.550 billion won last year.
Its holding entity, Hana Financial Group, said in a regulatory filing on Tuesday that it recorded 2.4 trillion won in net profit on a consolidated basis last year, up 7.84% year-on-year. former. Its operating profit was 3.3 trillion won, up 3.9% year-on-year, and revenue totaled 38.7 billion won, up 18.9% year-on-year.
The financial conglomerate generates most of its profits and income from the KEB Hana Bank trade credit unit. It aims to increase the contribution to the revenues of its non-banking sector to 30% by 2025.
Hana Financial Group shares closed up 2.7% at 34,300 won on Wednesday. Hana Financial Investment is not listed.
By Cho Jeehyun
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