汇丰银行-韩国银行业-korea banks 2q17 trends beating consensus again and again-20170721-hsbc

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1、21July2017KoreaBanksEQUITIESFIG2Q17trends:BeatingconsensusagainandagainKoreaBeatingconsensusestimatesfor6consecutivequartersSinyoungPark*despite+42%earningsrevisionssinceMay2016Analyst,KoreaFinancialsTheHongkongandShanghaiBankingCorporationLimited,SeoulSecuritiesBranchEarningsstabilit

2、yimprovingatKoreanbankswithsharplysinyoungpark@kr.hsbc.com+82237068770lowercreditcost,betterefficiencyandsolidmargintrend*Employedbyanon-USaffiliateofHSBCSecurities(USA)Inc,andisEarningsqualitywasthestrongestatKBFG,inourviewnotregistered/qualifiedpursuanttoFINRAregulationsKBFG(Buy):26%beat

3、giventhebiggestNIMexpansionandwrite-backsKBFGreported2Q17earningsofKRW990bn,beatingconsensusby26%giventhebiggestNIMexpansion(upanother6bpsq-o-q),sharplylowercreditcost(8bps)andstronger-than-expectednon-bankearningscontribution(especiallyKBInsurance).Inaddition,recurringSG&Acostdeclinedby4.6

4、%y-o-yonthebackofcontinuedcostcontrolmeasuresandlarge-scaleemployeerestructuring.Withadiversifiedbusinessportfolioandimprovedefficiency,KBFG’srecurringquarterlyearningscontinuetolevelup,fromKRW533bnin2016andnowuptoKRW860bnasof2Q17.Shinhan(Hold):29%beatduetolowercreditcostandVisadisposalgain

5、sShinhanFGreported2Q17earningsofKRW892bn,beatingconsensusby29%duetocreditcostimprovement(down29bpsy-o-yto26bps)andlargedisposalgain(KRW116bn).Withregardstocoreearningstrend,thesizeofgroupNIMexpansion✔VoteinAsiamoneyBrokersPoll2017wassmallerat1bpsq-o-qbecauseShinhanCardpre-emptivelysecuredsi

6、zablefunding(i.e.,issuingbonds/ABS),inanticipationofhighermarketratesin2H17.Votingstarts6thJulyIfyouvalueourserviceandinsight,voteforHSBCClickheretovoteWoori(Hold):10%beatduetocostcontrolandstrongernon-interestincomeWooriBankreported2Q17earningsofKRW461bn,beatingconsensusby10%.WhilethebankN

7、IMexpansionwassmallerat1bpsq-o-qvs.peers(3-6bps),GlobalResearchstringentcostcontrolandstronger-than-expectednon-interestincomehelped.OntheGettheAppcostside,WooriBankislookingtostructurallyimproveitscostviaalarge-scaleFindHSBCGlobalResearchonvoluntaryreti