Shinhan Financial Group on Friday said its first-quarter net profit dropped by 5 percent on increased costs to pay compensation for a mishap in sales of equity-linked securities.
Korea’s top finance firms KB, Shinhan, Hana, Woori and NongHhyup have set aside a total of nearly 1.7 trillion won ($1.2 billion) in reserve for the compensation of losses related to the misselling of equity-linked securities products tracking the Hang Seng China Enterprises Index in Hong Kong. While KB Financial Group, the top seller of the ELS products, set aside 862 billion won to cover the compensatio.
Shinhan Financial Group has reclaimed its position as the leading financial conglomerate in the country for its first-quarter earnings, due mainly to the expansion of corporate loans and improved interest margins.