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Issuer Credit Research

Issuer Flash: Hyundai Card Co., Ltd.

Issuer: Hyundai Card | Document: Issuer Flash | Date: 2026-07-24 | Event: H1 2026 Results

Report date: 2026-07-24 Event date: 2026-07-23 Event title: H1 2026 Results

1. Flash Conclusion

Hyundai Card's H1 2026 result is modestly supportive of the credit view established in the May 2026 issuer summary. Net profit rose 11.9% year on year to KRW 185.2bn and operating profit rose 16.3% to KRW 249.5bn, while the company reported a 10bp year-on-year decline in its delinquency ratio, excluding refinancing loans, to 0.74%. Transaction growth, a small increase in members and broadly unchanged loan balances suggest that earnings growth was not simply the result of an expansion in the reported consumer-finance loan book.

The result does not, however, establish a broad improvement in Hyundai Card's risk profile. It is a high-level company results announcement rather than a full interim financial statement or investor presentation. It does not disclose the H1 credit-cost trend, delinquency including refinancing loans, NPL coverage, capital ratios, funding mix, maturity ladder, liquidity composition or hedging costs. Those omissions are especially important for a deposit-free Korean card company that depends on bonds, ABS, short-term market instruments, loans and overseas funding. The event therefore supports the existing view of a profitable, investment-grade card franchise with meaningful HMG support expectations, but it does not reduce the need to monitor asset quality and refinancing resilience. HMG support expectations should not be read as an explicit guarantee of Hyundai Card's bonds.

2. What Was Announced

In its 23 July 2026 H1 results announcement, Hyundai Card reported operating revenue of KRW 2,337.2bn, up 10.0% year on year. Operating profit increased to KRW 249.5bn from KRW 214.5bn, and profit before tax increased to KRW 250.1bn from KRW 214.2bn. Net profit rose to KRW 185.2bn from KRW 165.5bn. The issuer also presented an uninterrupted increase in first-half operating and net profit from 2022 through 2026; that history is helpful context, but it does not by itself demonstrate through-the-cycle resilience.

Reported transaction activity remained positive. Total transaction volume increased 4.3% to KRW 97.4518tn, including a 4.6% rise in credit purchases to KRW 90.6894tn. Loans were broadly flat at KRW 6.7624tn, versus KRW 6.7780tn a year earlier. Membership increased by 280,000 to 12.78m. The company said average monthly spending per member was maintained at around KRW 1.2m and overseas spending reached KRW 2.128tn. These indicators are consistent with continued franchise activity, but they do not show the risk composition, seasoning, yield or loss performance of receivables.

The disclosed delinquency ratio, excluding refinancing loans, declined to 0.74% from 0.84% in H1 2025. This is a favorable year-on-year headline change, but longer-term comparability is unconfirmed from this high-level release. The definition matters: a ratio excluding refinancing loans cannot be treated as a complete measure of the credit risk borne by the company. The announcement provides neither the comparable ratio including refinancing loans nor bad-debt expense, charge-offs, provisioning or NPL-coverage data.

3. Credit Read-Through

The earnings outcome strengthens, but does not materially change, the existing credit assessment. Higher operating profit and net profit give Hyundai Card more internal capacity to absorb normal credit costs and funding expenses. The high-level release does not permit a separation of recurring operating improvement from foreign-exchange and derivative effects, or a reconciliation of the profit increase to credit and funding costs. The combination of higher transaction volume, a limited increase in members and broadly stable reported loans is more reassuring than a result driven by rapid growth in cash advances, revolving balances or other higher-risk consumer-finance assets. The lower reported delinquency ratio is also supportive at face value.

For bondholders, the central limitation is that earnings and the selected delinquency measure do not answer the liquidity and ALM questions that dominate a market-funded card-company credit under stress. Hyundai Card's ability to refinance bonds, ABS, CP/STB, bank loans and overseas funding remains sensitive to market access, interest and hedging costs, asset quality and confidence in the HMG relationship. The release contains no H1 balance sheet or funding information with which to test changes in these factors. Nor does it supply an updated adjusted capital ratio or a detailed reconciliation between earnings, dividends and loss-absorption capacity.

The results consequently support the proposition that the core card franchise remains profitable in the first half, rather than a conclusion that the funding or asset-quality risk has been resolved. The most constructive reading will be validated only if forthcoming H1 financial and IR materials show that credit costs, delinquency on a comparable basis, liquidity and capital remained consistent with the headline result. Conversely, a deterioration in funding costs or in the broader delinquency measure could weaken the apparent benefit of the profit increase.

4. Key Numbers

Metric H1 2026 H1 2025 Credit reading
Operating revenue KRW 2,337.2bn KRW 2,125.5bn Higher top-line result; the release notes that this measure includes foreign-exchange and derivative effects.
Operating profit KRW 249.5bn KRW 214.5bn Up 16.3%; supportive earnings buffer, but credit-cost and funding-cost details are not disclosed.
Net profit KRW 185.2bn KRW 165.5bn Up 11.9%; does not on its own establish capital generation after distributions.
Total transaction volume KRW 97.4518tn KRW 93.4654tn Up 4.3%; confirms continued franchise activity.
Credit purchases KRW 90.6894tn KRW 86.6873tn Up 4.6%; the principal driver of reported activity growth.
Loans KRW 6.7624tn KRW 6.7780tn Broadly flat; detailed product mix and risk characteristics are not disclosed.
Delinquency ratio, excluding refinancing loans 0.74% 0.84% Favorable 10bp year-on-year change, subject to the metric's limited scope.

Source for all table figures: Hyundai Card & Hyundai Commercial Newsroom, H1 2026 results announcement, 23 July 2026.

5. What To Watch Next

6. Sources