Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<p>Over the past month, the stock performance of the four largest banks in Korea has been interesting. Hana Financial Group and Woori Financial Group outperformed relatively, and in particular, KB Financial Group underperformed by more than 5%p compared to Woori Financial Group.</p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/219/154/original/Screen+Shot+2021-07-18+at+6.21.51+PM.png?1626646949" class="editor-image img-responsive" data-smartkarma-image-id="219154"></figure><p></p></section><p>In this interim dividend, there is a possibility that dividends not paid last year will be paid retroactively. However, excluding this possibility and assuming that the total annual dividend for this year is adjusted to the level of 2019, Woori Financial Group and Hana Financial Group have the highest dividend yields.</p><table class="table table-striped">
<colgroup>
<col width="100">
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<tbody>
<tr>
<td style="width: 380.724px;" data-sheets-value='{"1":2,"2":"Dividend yield"}'>Estimated dividend yield, assuming that the total annual dividend for. this year is adjusted to the level of 2019</td>
<td style="text-align: right; width: 86.8324px;" data-sheets-value='{"1":3,"3":2018}'>2018</td>
<td style="text-align: right; width: 92.5852px;" data-sheets-value='{"1":3,"3":2019}'>2019</td>
<td style="text-align: right; width: 94.7301px;" data-sheets-value='{"1":3,"3":2020}'>2020</td>
<td style="text-align: right; width: 91.1364px;" data-sheets-value='{"1":2,"2":"2021E"}'>2021E</td>
</tr>
<tr>
<td style="width: 380.724px;" data-sheets-value='{"1":2,"2":"Shinhan Financial"}'>Shinhan Financial</td>
<td style="text-align: right; width: 86.8324px;" data-sheets-value='{"1":3,"3":0.0404}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.04%</td>
<td style="text-align: right; width: 92.5852px;" data-sheets-value='{"1":3,"3":0.0427}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.27%</td>
<td style="text-align: right; width: 94.7301px;" data-sheets-value='{"1":3,"3":0.0468}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.68%</td>
<td style="text-align: right; width: 91.1364px;" data-sheets-value='{"1":3,"3":0.050608571468662246}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-14]C[0]/googlefinance(R[-42]C[0], "price")'><strong>5.06%</strong></td>
</tr>
<tr>
<td style="width: 380.724px;" data-sheets-value='{"1":2,"2":"KB Financial"}'>KB Financial</td>
<td style="text-align: right; width: 86.8324px;" data-sheets-value='{"1":3,"3":0.0413}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.13%</td>
<td style="text-align: right; width: 92.5852px;" data-sheets-value='{"1":3,"3":0.0464}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.64%</td>
<td style="text-align: right; width: 94.7301px;" data-sheets-value='{"1":3,"3":0.0408}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.08%</td>
<td style="text-align: right; width: 91.1364px;" data-sheets-value='{"1":3,"3":0.05260170044159115}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-14]C[0]/googlefinance(R[-42]C[0], "price")'><strong>5.26%</strong></td>
</tr>
<tr>
<td style="width: 380.724px;" data-sheets-value='{"1":2,"2":"Hana Financial"}'>Hana Financial</td>
<td style="text-align: right; width: 86.8324px;" data-sheets-value='{"1":3,"3":0.0524}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>5.24%</td>
<td style="text-align: right; width: 92.5852px;" data-sheets-value='{"1":3,"3":0.0569}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>5.69%</td>
<td style="text-align: right; width: 94.7301px;" data-sheets-value='{"1":3,"3":0.0536}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>5.36%</td>
<td style="text-align: right; width: 91.1364px;" data-sheets-value='{"1":3,"3":0.0619847401646764}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-14]C[0]/googlefinance(R[-42]C[0], "price")'><strong>6.20%</strong></td>
</tr>
<tr>
<td style="width: 380.724px;" data-sheets-value='{"1":2,"2":"Woori Financial"}'><div><div>Woori Financial</div></div></td>
<td style="text-align: right; width: 86.8324px;"></td>
<td style="text-align: right; width: 92.5852px;" data-sheets-value='{"1":3,"3":0.0603}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>6.03%</td>
<td style="text-align: right; width: 94.7301px;" data-sheets-value='{"1":3,"3":0.037}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>3.70%</td>
<td style="text-align: right; width: 91.1364px;" data-sheets-value='{"1":3,"3":0.06629340778032639}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-14]C[0]/googlefinance(R[-42]C[0], "price")'><strong>6.63%</strong></td>
</tr>
<tr><td colspan="5" rowspan="1" style="width: 746.008px;" data-sheets-value='{"1":2,"2":"Source: FnGuide &amp; KSD Seibro"}'>Source: FnGuide &amp; KSD Seibro</td></tr>
</tbody>
</table><p>This is similar to the dividend yield calculated based on this year's estimated DPS of local street consensus gathered by FnGuide.</p><table class="table table-striped">
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<tbody>
<tr>
<td style="width: 362.429px;" data-sheets-value='{"1":2,"2":"Dividend yield"}'>Annual dividend yield based on the local street consensus compiled by FnGuide</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":2018}'>2018</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":2019}'>2019</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":2020}'>2020</td>
<td style="text-align: right; width: 96.0653px;" data-sheets-value='{"1":2,"2":"2021E"}'>2021E</td>
</tr>
<tr>
<td style="width: 362.429px;" data-sheets-value='{"1":2,"2":"Shinhan Financial"}'>Shinhan Financial</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0404}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.04%</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0427}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.27%</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0468}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.68%</td>
<td style="text-align: right; width: 96.0653px;" data-sheets-value='{"1":3,"3":0.052}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-28]C[0]/googlefinance(R[-35]C[0], "price")'><strong>5.20%</strong></td>
</tr>
<tr>
<td style="width: 362.429px;" data-sheets-value='{"1":2,"2":"KB Financial"}'>KB Financial</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0413}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.13%</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0464}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.64%</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0408}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>4.08%</td>
<td style="text-align: right; width: 96.0653px;" data-sheets-value='{"1":3,"3":0.05146666666666667}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-28]C[0]/googlefinance(R[-35]C[0], "price")'><strong>5.15%</strong></td>
</tr>
<tr>
<td style="width: 362.429px;" data-sheets-value='{"1":2,"2":"Hana Financial"}'>Hana Financial</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0524}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>5.24%</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0569}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>5.69%</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0536}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>5.36%</td>
<td style="text-align: right; width: 96.0653px;" data-sheets-value='{"1":3,"3":0.06045662100456621}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-28]C[0]/googlefinance(R[-35]C[0], "price")'><strong>6.05%</strong></td>
</tr>
<tr>
<td style="width: 362.429px;" data-sheets-value='{"1":2,"2":"Woori Financial"}'><div><div>Woori Financial</div></div></td>
<td style="text-align: right; width: 95.8381px;">-</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.0603}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>6.03%</td>
<td style="text-align: right; width: 95.8381px;" data-sheets-value='{"1":3,"3":0.037}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>3.70%</td>
<td style="text-align: right; width: 96.0653px;" data-sheets-value='{"1":3,"3":0.06334801762114538}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-28]C[0]/googlefinance(R[-35]C[0], "price")'><strong>6.33%</strong></td>
</tr>
<tr><td colspan="5" rowspan="1" style="width: 746.008px;" data-sheets-value='{"1":2,"2":"Source: FnGuide &amp; KSD Seibro"}'>Source: FnGuide &amp; KSD Seibro</td></tr>
</tbody>
</table><p>As shown in the downward trend of 12M forward PER below, the market is taking a conservative approach to the recent slowdown in bank stocks' earnings growth, which is believed to have led to growing interest in dividends.</p><p>Interestingly, the difference in P/E decline between Hana Financial Group and KB Financial Group was the largest. This seems to have been influenced by the fact that Hana Financial Group has a higher probability of paying expected dividends than Woori Financial Group.</p><table class="table table-striped">
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<tbody>
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<td data-sheets-value='{"1":2,"2":"12-month forward PER"}'>12-month forward PER</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44393}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 7. 16</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"3 months ago"}'>3 months ago</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"3-month Δ"}'>3-month Δ</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Shinhan Financial"}'>Shinhan Financial</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":5.03}' data-sheets-numberformat='{"1":2,"2":"0.00x","3":1}'>5.03x</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":5.12}' data-sheets-numberformat='{"1":2,"2":"0.00x","3":1}'>5.12x</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.017578124999999972}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[0]C[-2]-R[0]C[-1])/R[0]C[-1]">-1.76%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KB Financial"}'><strong>KB Financial</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":5.17}' data-sheets-numberformat='{"1":2,"2":"0.00x","3":1}'><strong>5.17x</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":5.65}' data-sheets-numberformat='{"1":2,"2":"0.00x","3":1}'><strong>5.65x</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.08495575221238945}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[0]C[-2]-R[0]C[-1])/R[0]C[-1]"><strong>-8.50%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hana Financial"}'><strong>Hana Financial</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.21}' data-sheets-numberformat='{"1":2,"2":"0.00x","3":1}'><strong>4.21x</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.35}' data-sheets-numberformat='{"1":2,"2":"0.00x","3":1}'><strong>4.35x</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.03218390804597694}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[0]C[-2]-R[0]C[-1])/R[0]C[-1]"><strong>-3.22%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Woori Financial"}'>Woori Financial</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3.99}' data-sheets-numberformat='{"1":2,"2":"0.00x","3":1}'>3.99x</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.16}' data-sheets-numberformat='{"1":2,"2":"0.00x","3":1}'>4.16x</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.040865384615384595}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[0]C[-2]-R[0]C[-1])/R[0]C[-1]">-4.09%</td>
</tr>
<tr><td colspan="4" rowspan="1" data-sheets-value='{"1":2,"2":"Source: FnGuide &amp; KSD Seibro"}'>Source: FnGuide &amp; KSD Seibro</td></tr>
</tbody>
</table>

Over the past month, the stock performance of the four largest banks in Korea has been interesting. Hana Financial Group and Woori Financial Group outperformed relatively, and in particular, KB Financial Group underperformed by more than 5%p compared to Woori Financial Group.In this interim dividend, there is a possibility that dividends not paid last year will be paid retroactively. However, excluding this possibility and assuming that the total annual dividend for this year is adjusted to the level of 2019, Woori Financial Group and Hana Financial Group have the highest dividend yields.









Estimated dividend yield, assuming that the total annual dividend for. this year is adjusted to the level of 2019
2018
2019
2020
2021E


Shinhan Financial
4.04%
4.27%
4.68%
5.06%


KB Financial
4.13%
4.64%
4.08%
5.26%


Hana Financial
5.24%
5.69%
5.36%
6.20%


Woori Financial

6.03%
3.70%
6.63%

Source: FnGuide &amp; KSD Seibro

This is similar to the dividend yield calculated based on this year's estimated DPS of local street consensus gathered by FnGuide.









Annual dividend yield based on the local street consensus compiled by FnGuide
2018
2019
2020
2021E


Shinhan Financial
4.04%
4.27%
4.68%
5.20%


KB Financial
4.13%
4.64%
4.08%
5.15%


Hana Financial
5.24%
5.69%
5.36%
6.05%


Woori Financial
-
6.03%
3.70%
6.33%

Source: FnGuide &amp; KSD Seibro

As shown in the downward trend of 12M forward PER below, the market is taking a conservative approach to the recent slowdown in bank stocks' earnings growth, which is believed to have led to growing interest in dividends.Interestingly, the difference in P/E decline between Hana Financial Group and KB Financial Group was the largest. This seems to have been influenced by the fact that Hana Financial Group has a higher probability of paying expected dividends than Woori Financial Group.








12-month forward PER
2021. 7. 16
3 months ago
3-month Δ


Shinhan Financial
5.03x
5.12x
-1.76%


KB Financial
5.17x
5.65x
-8.50%


Hana Financial
4.21x
4.35x
-3.22%


Woori Financial
3.99x
4.16x
-4.09%

Source: FnGuide &amp; KSD Seibro



Korean Local Banks Trading Dynamics: Dividend Yield Difference & Kakao Bank Listing

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<p>In this insight, we provide a deeper, competitive analysis of the Korean fintech industry and the major competitors. Once Kakao Pay completes its IPO, it will be the largest pure-play fintech company in Korea. In addition, we compare Kakao Pay's valuation against the recent $7.5 billion valuation received by Viva Republica in Korea. </p><p>The table below provides the main fintech services that are offered in South Korea along with the number of players competing in each of these segments. </p><table class="table table-striped">
<colgroup>
<col>
<col>
<col>
</colgroup>
<tbody>
<tr>
<td colspan="2" style="width: 463.91px;"><strong>Fintech Services in Korea (Major Services &amp; Number of Players)</strong></td>
<td style="text-align: center; width: 150.45px;"></td>
</tr>
<tr>
<td style="text-align: left; width: 172.63px;"><strong>Major Services</strong></td>
<td style="text-align: left; width: 291.28px;"><strong>Key Details</strong></td>
<td style="text-align: center; width: 150.45px;"><strong>Number of firms (% of Total)</strong></td>
</tr>
<tr>
<td style="width: 172.63px;">Payment/Money Transfer</td>
<td style="width: 291.28px;">Provision of payment/remittance service through simple self-authentication on mobile devices with payment information registered in advance</td>
<td style="text-align: center; width: 150.45px;">83 (24.1%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Crowd Funding/P2P finance</td>
<td style="width: 291.28px;">A service that receives business funds, etc. from an unspecified number of investors through an online intermediary</td>
<td style="text-align: center; width: 150.45px;">45 (13.0%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Authentification/security</td>
<td style="width: 291.28px;">Prevent crime by detecting abnormal transactions or provide identity authentication service through fingerprint, iris, and facial recognition</td>
<td style="text-align: center; width: 150.45px;">43 (12.5%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Personal financial management</td>
<td style="width: 291.28px;">Provides services such as expenditure management, integrated financial product management, credit score management, and customized financial product recommendation</td>
<td style="text-align: center; width: 150.45px;">33 (9.6%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Insurance</td>
<td style="width: 291.28px;">Provides efficient and innovative services by converging the latest technologies in each insurance field</td>
<td style="text-align: center; width: 150.45px;">23 (6.7%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Investment</td>
<td style="width: 291.28px;">Manage assets mainly based on AI algorithms or provide advice to investors</td>
<td style="text-align: center; width: 150.45px;">18 (5.2%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Fintech System Integrator</td>
<td style="width: 291.28px;">Fintech infrastructure services such as financial data and risk management</td>
<td style="text-align: center; width: 150.45px;">18 (5.2%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Overseas money transfer</td>
<td style="width: 291.28px;">Low fees and fast overseas remittance service</td>
<td style="text-align: center; width: 150.45px;">14 (4.1%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Cryptocurrency</td>
<td style="width: 291.28px;">Provision of crypto currency distribution service</td>
<td style="text-align: center; width: 150.45px;">6 (1.7%)</td>
</tr>
<tr>
<td style="width: 172.63px;">Others</td>
<td style="width: 291.28px;"><div></div></td>
<td style="text-align: center; width: 150.45px;">62 (18.0%)</td>
</tr>
<tr>
<td style="width: 172.63px;"><strong>Total</strong></td>
<td style="width: 291.28px;">
<div>
<div></div>
<div><div></div></div>
</div>
<div><div></div></div>
</td>
<td style="text-align: center; width: 150.45px;"><strong>345</strong></td>
</tr>
<tr>
<td colspan="2" style="width: 463.91px;">Source: Korea Fintech Association, 2019</td>
<td style="text-align: center; width: 150.45px;"></td>
</tr>
</tbody>
</table>

In this insight, we provide a deeper, competitive analysis of the Korean fintech industry and the major competitors. Once Kakao Pay completes its IPO, it will be the largest pure-play fintech company in Korea. In addition, we compare Kakao Pay's valuation against the recent $7.5 billion valuation received by Viva Republica in Korea. The table below provides the main fintech services that are offered in South Korea along with the number of players competing in each of these segments. 







Fintech Services in Korea (Major Services &amp; Number of Players)



Major Services
Key Details
Number of firms (% of Total)


Payment/Money Transfer
Provision of payment/remittance service through simple self-authentication on mobile devices with payment information registered in advance
83 (24.1%)


Crowd Funding/P2P finance
A service that receives business funds, etc. from an unspecified number of investors through an online intermediary
45 (13.0%)


Authentification/security
Prevent crime by detecting abnormal transactions or provide identity authentication service through fingerprint, iris, and facial recognition
43 (12.5%)


Personal financial management
Provides services such as expenditure management, integrated financial product management, credit score management, and customized financial product recommendation
33 (9.6%)


Insurance
Provides efficient and innovative services by converging the latest technologies in each insurance field
23 (6.7%)


Investment
Manage assets mainly based on AI algorithms or provide advice to investors
18 (5.2%)


Fintech System Integrator
Fintech infrastructure services such as financial data and risk management
18 (5.2%)


Overseas money transfer
Low fees and fast overseas remittance service
14 (4.1%)


Cryptocurrency
Provision of crypto currency distribution service
6 (1.7%)


Others

62 (18.0%)


Total







345


Source: Korea Fintech Association, 2019





Kakao Pay: An Overview of Korean Fintech Competitors & A Comparison to Viva Republica's Valuation

<p>This weekend, several local media published articles stating that all major domestic financial holding companies are positively reviewing interim dividends this year. These media said that they had heard so from insiders in the local financial sector.</p><p>Hana Financial Group has paid interim dividends every year. Although the other financial holding companies are able to pay interim dividends under the articles of incorporation, they have never done so.</p><div class="content-highlight"><p>The FSC conducted a stress test on banks and financial holding companies this month, and as all of them passed, the recommendation to limit dividends came to an end at the end of this month.</p></div><p>Therefore, it is highly likely that each financial holding company will hold a board meeting to determine an interim dividend after the 2Q earnings release. As dividends were limited at the beginning of this year by the financial authorities, all of them will likely pay interim dividends.</p>

This weekend, several local media published articles stating that all major domestic financial holding companies are positively reviewing interim dividends this year. These media said that they had heard so from insiders in the local financial sector.Hana Financial Group has paid interim dividends every year. Although the other financial holding companies are able to pay interim dividends under the articles of incorporation, they have never done so.The FSC conducted a stress test on banks and financial holding companies this month, and as all of them passed, the recommendation to limit dividends came to an end at the end of this month.Therefore, it is highly likely that each financial holding company will hold a board meeting to determine an interim dividend after the 2Q earnings release. As dividends were limited at the beginning of this year by the financial authorities, all of them will likely pay interim dividends.

Interim Div Yield Projections of Korean Financial Holdcos Ahead of June 29 Ex-Div Date

<p>Korea's financial regulators, the Financial Services Commission, had advised the local banks and bank holding companies to keep a dividend payout ratio below 20%. The purpose was clear. It was to secure a sufficient capital buffer to absorb potential losses resulting from COVID-19.</p><p>This recommendation for the 20% cap is effective until the end of this month.</p><p>The market widely expects the FSC to not renew this 20% dividend cap after this month amid the fast-rebounding economy.</p>

Korea's financial regulators, the Financial Services Commission, had advised the local banks and bank holding companies to keep a dividend payout ratio below 20%. The purpose was clear. It was to secure a sufficient capital buffer to absorb potential losses resulting from COVID-19.This recommendation for the 20% cap is effective until the end of this month.The market widely expects the FSC to not renew this 20% dividend cap after this month amid the fast-rebounding economy.

Korea Banks 20% Dividend Cap Scrapping: Projected Div Payout & Yield of 8 Bank Stocks

<p>Korea's local banks are still going strong as an inflation hedge stock. In particular, the sector leaders continue to shine the most, which is understandable.</p><p>Shinhan Financial Group has outperformed most of its local peers of late, causing a harsh diversion vs. several names.</p><table class="table table-striped">
<colgroup>
<col width="200">
<col width="70">
<col width="70">
<col width="200">
<col width="70">
<col width="70">
<col width="70">
<col width="70">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Comp 1 (long)"}'>Comp 1 (long)</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Market cap"}'>Market cap</td>
<td data-sheets-value='{"1":2,"2":"Comp 2 (short)"}'>Comp 2 (short)</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Market cap"}'>Market cap</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"180-day correlation coefficient"}'>180-day correlation coefficient</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Sigma on a 20-day moving average"}'>Sigma on a 20-day moving average</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Woori Financial Group Inc"}'><strong>Woori Financial Group Inc</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":316140}'>316140</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":7981.05789715}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>₩7,981.1B</td>
<td data-sheets-value='{"1":2,"2":"Shinhan Financial Group Co., Ltd."}'><strong>Shinhan Financial Group Co., Ltd.</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"055550"}'>055550</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":21826.3311565}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>₩21,826.3B</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.9223855252672568}' data-sheets-numberformat='[null,2,"#,##0.00000",1]'><strong>0.92</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-1.7434864364413833}' data-sheets-numberformat='[null,2,"#,##0.00000",1]'><strong>-1.74</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hana Financial Group Inc"}'><strong>Hana Financial Group Inc</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"086790"}'>086790</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":13676.0259241}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>₩13,676.0B</td>
<td data-sheets-value='{"1":2,"2":"Shinhan Financial Group Co., Ltd."}'><strong>Shinhan Financial Group Co., Ltd.</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"055550"}'>055550</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":21826.3311565}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>₩21,826.3B</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.9415706574402087}' data-sheets-numberformat='[null,2,"#,##0.00000",1]'><strong>0.94</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-1.6583215542673198}' data-sheets-numberformat='[null,2,"#,##0.00000",1]'><strong>-1.66</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KB Financial Group Inc"}'><strong>KB Financial Group Inc</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"105560"}'>105560</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":23701.05144}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>₩23,701.1B</td>
<td data-sheets-value='{"1":2,"2":"Shinhan Financial Group Co., Ltd."}'><strong>Shinhan Financial Group Co., Ltd.</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"055550"}'>055550</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":21826.3311565}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>₩21,826.3B</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.9610188453950309}' data-sheets-numberformat='[null,2,"#,##0.00000",1]'><strong>0.96</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-1.5589371642688024}' data-sheets-numberformat='[null,2,"#,##0.00000",1]'><strong>-1.56</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"BNK Financial Group Inc"}'><strong>BNK Financial Group Inc</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"138930"}'>138930</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2591.1852057}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>₩2,591.2B</td>
<td data-sheets-value='{"1":2,"2":"Shinhan Financial Group Co., Ltd."}'><strong>Shinhan Financial Group Co., Ltd.</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"055550"}'>055550</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":21826.3311565}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>₩21,826.3B</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.972704739094366}' data-sheets-numberformat='[null,2,"#,##0.00000",1]'><strong>0.97</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-1.0491776745143695}' data-sheets-numberformat='[null,2,"#,##0.00000",1]'><strong>-1.05</strong></td>
</tr>
<tr><td colspan="8">Source: KRX<strong><br></strong>
</td></tr>
</tbody>
</table><p>The harshest diversion at this point goes to Woori Financial Group. The current sigma is -1.74 on a 20-day moving average. Its price ratio relative to Shinhan is now 9.55% below the 180-day average. In fact, it is at a 180-day low.</p><table class="table table-striped">
<colgroup>
<col width="70">
<col width="70">
<col width="70">
<col width="70">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Price ratio"}' data-sheets-numberformat='[null,4,"[$₩]#,##0"]'>Price ratio</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"%Δ to 180-day mean"}' data-sheets-numberformat='[null,4,"[$₩]#,##0"]'>%Δ to 180-day mean</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"%Δ to 180-day high"}' data-sheets-numberformat='[null,4,"[$₩]#,##0"]'>%Δ to 180-day high</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"%Δ to 180-day low"}' data-sheets-numberformat='[null,4,"[$₩]#,##0"]'>%Δ to 180-day low</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Woori Financial Group Inc"}' data-sheets-formula="=R[-16]C[0]"><strong>Woori Financial Group Inc</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.09551050492215632}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]"><strong>-9.55%</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.158687466379774}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]"><strong>-15.87%</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]"><strong>0.00%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hana Financial Group Inc"}' data-sheets-formula="=R[-16]C[0]">Hana Financial Group Inc</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.007327297625351524}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">-0.73%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.10178905429741551}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">-10.18%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.14368007113294015}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">14.37%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KB Financial Group Inc"}' data-sheets-formula="=R[-16]C[0]">KB Financial Group Inc</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.022657232352227285}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">-2.27%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.1009918086293668}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">-10.10%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.08257600627747405}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">8.26%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"BNK Financial Group Inc"}' data-sheets-formula="=R[-16]C[0]">BNK Financial Group Inc</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.037819100378221324}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">3.78%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.048692073349346776}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">-4.87%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.12800025002083512}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[0]C5-R[0]C[4])/R[0]C[4]">12.80%</td>
</tr>
<tr><td colspan="4">Source: KRX</td></tr>
</tbody>
</table><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/210/024/original/Woori+Financial+Group+Inc+vs.+Shinhan+Financial+Group+Co.%2C+Ltd.png?1622371064" class="editor-image img-responsive" data-smartkarma-image-id="210024"></figure></section>

Korea's local banks are still going strong as an inflation hedge stock. In particular, the sector leaders continue to shine the most, which is understandable.Shinhan Financial Group has outperformed most of its local peers of late, causing a harsh diversion vs. several names.












Comp 1 (long)
Ticker
Market cap
Comp 2 (short)
Ticker
Market cap
180-day correlation coefficient
Sigma on a 20-day moving average


Woori Financial Group Inc
316140
₩7,981.1B
Shinhan Financial Group Co., Ltd.
055550
₩21,826.3B
0.92
-1.74


Hana Financial Group Inc
086790
₩13,676.0B
Shinhan Financial Group Co., Ltd.
055550
₩21,826.3B
0.94
-1.66


KB Financial Group Inc
105560
₩23,701.1B
Shinhan Financial Group Co., Ltd.
055550
₩21,826.3B
0.96
-1.56


BNK Financial Group Inc
138930
₩2,591.2B
Shinhan Financial Group Co., Ltd.
055550
₩21,826.3B
0.97
-1.05

Source: KRX 


The harshest diversion at this point goes to Woori Financial Group. The current sigma is -1.74 on a 20-day moving average. Its price ratio relative to Shinhan is now 9.55% below the 180-day average. In fact, it is at a 180-day low.








Price ratio
%Δ to 180-day mean
%Δ to 180-day high
%Δ to 180-day low


Woori Financial Group Inc
-9.55%
-15.87%
0.00%


Hana Financial Group Inc
-0.73%
-10.18%
14.37%


KB Financial Group Inc
-2.27%
-10.10%
8.26%


BNK Financial Group Inc
3.78%
-4.87%
12.80%

Source: KRX



Korea Financials: Woori Vs. Shinhan Price Ratio at a 180-Day Low

South Korea

Woori Financial Group Inc. provides commercial banking services. The Company offers deposit services, loan services, bill services, settlement services, credit card, international, online banking, and other related services. Woori Financial Group also operates banking and retail banking businesses.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Woori Financial Group (316140 KS)

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Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)