SEOUL -- Shinhan Financial Group's new chief executive said Monday that South Korea's most profitable financial company is eyeing opportunities for mergers and acquisitions in the Asian market and further afield, as it seeks to exploit fast-growing demand for financial services in the region.
Cho Yong-byoung said that Shinhan will prepare carefully for M&A opportunities and be ready to move when a deal comes up. Cho took the helm of the group last week, replacing Han Dong-woo, who had led the group for the last six years.
"We believe there will be many chances in overseas markets. In particular, we are focusing on six markets in Asia and the U.S., where we have our key operations," said Cho at a press conference. "We will make efforts to find out opportunities through market survey and networks."
The six major markets are Vietnam, Indonesia, India, China, Japan and the U.S., Shinhan said. The group has business operations in 20 countries globally, having 165 bank branches and other sales channels.
The announcement came as the company experiences tough competition from local rival KB Financial Group to keep the top spot in the country's saturating financial industry. Last year, Shinhan posted 2.77 trillion won ($2.49 billion) of net profit, with KB close behind with 2.19 trillion won.
Among the six key target countries, Cho made the example of Indonesia, where it has a credit card partnership with the prominent Chinese-Indonesian conglomerate Salim Group. "Our credit card unit reached Indonesian market in cooperation with Salim Group. In overseas markets, there are many chances like that. I expect more opportunities will come from Indonesia," said Cho.
The former Shinhan Bank CEO also mentioned Shinhan's low return-on-equity data, saying it should reach double-digit figures if it wants to satisfy shareholders and investors. The group's ROE was 9.2% last year, up from 8.0% a year ago, but still far behind other leading Asian financial groups.