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Issuer Credit Research

Issuer Flash: Hana Securities Co., Ltd.

Issuer: Hana Securities | Document: Issuer Flash | Date: 2026-08-03 | Event: 1h2026 Results

Report date: 2026-08-03 Event date: 2026-07-24 Event title: 1H 2026 Business Results

1. Flash Conclusion

Hana Securities reported a materially stronger first half of 2026, with net income of KRW 273.1bn, up 155.7% year on year, and a second-quarter contribution of KRW 169.8bn. The result strengthens the recovery narrative established after the FY2023 loss and is more persuasive than the prior 1Q26 result alone because fee income, operating income and pre-provision profit all accelerated in 2Q. It is credit-positive that the improvement was accompanied by a lower reported cost-to-income ratio and an 8.72% reported ROE.

The event does not, however, change the core view of Hana Securities as a market-funded securities-company credit rather than a deposit-funded bank credit. The official group presentation shows a large increase in fee income, which is constructive for franchise earnings, but it also shows continued negative disposition and valuation income and does not provide the detailed standalone funding, liquidity, regulatory-capital, PF, guarantee or commitment disclosures needed to conclude that downside risks have fallen. Credit-loss provisions rose sharply from a very low 1H25 base, while the presentation's reported NPL ratio increased to 2.22% from 1.78% at FY2025. The earnings improvement is therefore supportive, but the durability of the recovery and the capacity to absorb a market or funding shock remain the central questions for bondholders.

Hana Financial Group ownership remains supportive context. The May issuer summary treats Hana Securities' role as HFG's securities platform as a basis for support expectations, but neither the current event nor the existing summary demonstrates committed liquidity support or a contractual guarantee. HFG ownership should not be read as a contractual HFG or Hana Bank guarantee for Hana Securities debt unless the relevant security documentation expressly provides one.

2. What Was Announced

Hana Financial Group's 1H26 presentation reported the following results for Hana Securities. The earnings table is a group presentation disclosure and should not be conflated with a standalone audited financial statement or with the prior report's K-IFRS balance-sheet scope.

KRW bn, unless stated otherwise 1H26 1H25 YoY 2Q26 1Q26 QoQ
General operating income 816.5 432.0 89.0% 464.1 352.5 31.7%
Interest income 248.1 258.2 -3.9% 118.6 129.5 -8.4%
Fee income 498.6 193.1 158.2% 303.3 195.3 55.3%
Other operating income 173.9 89.5 94.3% 97.3 76.6 27.1%
G&A expenses 417.1 312.0 33.7% 221.0 196.1 12.7%
Pre-provision profit 399.4 120.1 232.6% 243.0 156.4 55.4%
Credit-loss provisions 54.1 1.3 4,147.2% 39.4 14.7 167.6%
Operating income 345.3 118.8 190.6% 203.7 141.6 43.8%
Net income 273.1 106.8 155.7% 169.8 103.3 64.4%

The presentation also reports a 1H26 ROE of 8.72%, a cost-to-income ratio of 51.1%, and an NPL ratio of 2.22%. The comparison charts indicate 3.52% ROE, 77.1% cost-to-income and 1.78% NPL ratio for FY2025. The presentation does not provide the underlying asset-quality definitions, exposure mix or loss-coverage data, so those ratios should be treated as monitoring indicators rather than a complete asset-quality assessment.

3. Credit Read-Through

The earnings result is a clear positive relative to the May issuer summary. First-half net income already exceeds the KRW 212.0bn reported for full-year 2025 in the prior HFG Databook; that historical figure is drawn from the 2026-05-16 issuer summary and its cited FY2025 HFG Databook, not from the current 1H26 presentation. The second-quarter result also materially exceeded the first quarter. Aggregate fee income was the largest disclosed contributor to general operating income, rising 158.2% year on year in 1H26 and 55.3% quarter on quarter in 2Q26. That growth is positive for revenue diversification, but the presentation does not disclose the business-line composition, recurrence or sensitivity to market conditions of the fee income. It should therefore not be treated as evidence that a particular client-flow business has become a durable earnings source. Interest income, in contrast, declined modestly year on year and quarter on quarter.

The improvement should nevertheless not be treated as proof that earnings have become low-volatility. Other operating income rose to KRW 173.9bn in 1H26, and the presentation still records negative disposition and valuation income of KRW 104.1bn. Those line items reinforce the existing conclusion that market conditions, proprietary positions, financial products, valuation movements and capital-markets activity can affect results alongside fee income. The presentation is not detailed enough to separate the components, recurrence or stress sensitivity of those gains and losses.

Cost discipline and higher revenue improved the reported cost-to-income ratio to 51.1% from 77.1% for FY2025, and the reported ROE improved to 8.72% from 3.52%. These are favourable profitability indicators, but they do not replace the need to assess loss-absorption and liquidity under stress. The increase in credit-loss provisions to KRW 54.1bn from KRW 1.3bn in 1H25, and the reported NPL-ratio increase to 2.22% from 1.78% at FY2025, add a cautionary counterpoint. The base for provisions was unusually low, and no detailed exposure information was provided; nevertheless, the development argues for renewed checking of PF, bridge-loan, guarantee, commitment and proprietary-investment exposures rather than extrapolating the current earnings run rate.

For bondholders, the favourable result improves the near-term earnings cushion. HFG ownership and Hana Securities' role in the group's non-bank platform remain support expectations described in the existing issuer summary, rather than demonstrated stress liquidity support. The event does not establish that short-term market funding, repo haircuts, CP and short-term-bond rollover, collateral calls or foreign-currency funding are less sensitive in a stressed market. Nor does it establish a direct parent guarantee. The credit view is therefore strengthened on profitability, while the principal funding, liquidity and market-risk constraints remain unchanged pending standalone disclosures.

4. What To Watch Next

5. Sources