What Happened Really?
According to media reports, Hana Financial Group Chairman Kim Jung-tae and KEB Hana Bank President Ham Young-joo recently met with China Energy Company (CEFC) Chairman Ye Jianming in Seoul and talked about various cooperation plans in the financial sector.
At the meeting, the CEFC, which has been very interested in the banking business, was believed to suggest the sale first and KEB Hana was considering it. In fact, the CEFC bought a 20 percent stake of U.S.-based financial services company Cowen Group in March.
The rumor has spread as it is important for a South Korean company to attract a local company as a shareholder in order to keep up with the growth in China. China unit's deteriorating profitability prompted the rumor on the stake disposal. Its net profit declined to 5.6 billion won (US$5 million) in 2013 from 17.4 billion won (US$15.52 million) a year earlier. IT also posted net losses in 2014 and 2015.
KEB Hana Bank has been expanding its contact in the Chinese market. The bank tried to appoint then-president of Bank of Jilin as president of its China unit in 2015 but failed to receive approval from the China Banking Regulatory Commission (CBRC). KEB Hana Bank’s China unit is the 11th largest bank in terms of asset among foreign banks and has the highest number of Chinese branches among domestic banks. In addition, it made a 25 billion won (US$22.3 million) investment in Beijing Hana Asset Management Limited in March, pushing into the Chinese asset management market.
Meanwhile, KEB Hana Bank denied the rumor, saying it is not true.