Hyundai Card Issuer Summary

Report date: 2026-05-15
Issuer: Hyundai Card Co., Ltd.
Ticker: HYNCRD
Sector: South Korea specialty credit finance / credit card
Primary credit focus: issuer credit, senior unsecured bonds, market funding including foreign-currency bonds, and the distinction between parent-group support and explicit guarantees

1. Business Snapshot and Recent Developments

Hyundai Card Co., Ltd. is a major South Korean credit card company under Hyundai Motor Group. It is not a bank, but a deposit-free specialty credit finance company that combines credit purchase transactions, instalment financing, card loans, cash advances, investment finance, and co-branded / data-related businesses that use card payment data. The starting point for credit analysis is not to view Hyundai Card merely as a “card issuer backed by the Hyundai Motor Group brand,” but as a “market-funded non-bank that supports a large book of card receivables with bonds, ABS, CP, borrowings, and foreign-currency funding.”

The first question that determines the company’s credit quality is the extent to which its member base, PLCC business, and relationship with Hyundai Motor Group can absorb a deposit-free funding structure and sensitivity to the household credit cycle. In the company’s 2025 IR materials, the number of principal members was 12.667 million, credit purchase volume was KRW 176.6 trillion, managed assets were KRW 23.9 trillion, income before tax was KRW 440.6 billion, and net income was KRW 350.3 billion. In 1Q 2026, principal members increased to 12.714 million, credit purchase volume was KRW 44.8 trillion, managed assets were KRW 24.2 trillion, and income before tax was KRW 89.4 billion, indicating that balances and transaction volume are still expanding. At the same time, the 30+ day delinquency ratio in 1Q 2026 was 0.85% excluding refinancing loans and 1.21% including them, representing a slight increase from end-2025.

The most important recent point is that, while Hyundai Card has been growing profit on a standalone basis, the South Korean card industry as a whole is under pressure from fee income, funding costs, and delinquencies. According to Yonhap, citing Financial Supervisory Service data, the eight South Korean card companies’ 2025 net income declined 9% year on year, and the industry’s end-year delinquency ratio was 1.52%. Hyundai Card’s disclosed delinquency ratio appears low, but given differences in definitions and product mix, this should not be treated as evidence of a permanent advantage.

The key indicators from 2025 through 1Q 2026, narrowed to their credit implications, are as follows.

In the 2025 audited financial statements, total assets were KRW 26.999 trillion, card assets were KRW 22.886 trillion, borrowings were KRW 20.092 trillion, and equity was KRW 4.321 trillion. Major shareholders were Hyundai Motor Company with 36.96%, Hyundai Commercial with 34.60%, Kia Corporation with 6.48%, and Fubon Life Insurance with 20.00%, meaning HMG-related ownership is approximately 78%. JCR assigns an AA- / Stable rating based on HMG’s control and involvement and Hyundai Card’s strategic importance, but this is rating support incorporation and does not mean an explicit guarantee by Hyundai Motor Company.

2. Industry Position and Franchise Strength

South Korea’s credit card market is highly penetrated as a payment infrastructure, and transaction volume is large for card companies. At the same time, merchant fee regulation, consumer protection, household debt management, and fluctuations in funding costs tend to constrain profitability. In assessing the credit quality of a card company, transaction volume alone is insufficient; differences in member acquisition, usage frequency, partners, risk selection, funding cost, and credit cost are important.

The core of Hyundai Card’s franchise is its credit purchase volume, principal members, PLCC business, and points of contact with Hyundai Motor Group. Credit purchase volume was KRW 176.6 trillion in 2025, up from KRW 166.3 trillion in 2024. The company’s IR materials show personal credit purchase market share at 17.5% in both 2024 and 2025, and 17.3% in 1Q 2026. The broadly stable market share indicates that the company’s growth has not merely been the result of temporary campaigns, but that it maintains a meaningful payment franchise. However, the slight decline in share in 1Q 2026 means competition cannot be described as loose.

PLCC is a differentiating factor for the company. By connecting partner brands’ customer bases, card usage and data analytics, it can raise usage frequency and customer stickiness. However, even if transaction volume increases, a card company’s conversion into profit can decline as a result of merchant fee regulation, points / promotional expenses, and growth in credit balances. PLCC is credit positive to the extent that it leads to acquisition of lower-risk members, continued usage, and low credit costs.

The relationship with Hyundai Motor Group affects both competitiveness and credit enhancement. Through HMC, Kia, and Hyundai Commercial, the company has access to the group’s customer interface, brand recognition, director and management involvement, and equity links. JCR assesses that HMG owns 78% of the company’s shares, that several directors are from HMG, and that the company is strategically important in supporting HMG’s automobile sales from a financing perspective. Use of HMG’s customer base may reinforce the business base in the context of card issuance, auto-related payments, data services, and future in-car payment.

Even so, Hyundai Card differs from Hyundai Capital Services. Hyundai Capital has a more direct captive auto-finance character and is more closely linked to collateral value and support for automobile sales. Hyundai Card is a card and consumer finance company, and while its relationship with HMG is clear, the credit risk of card receivables, merchant fees, consumer finance regulation, and market funding have their own drivers of volatility. It is necessary to distinguish between rating-based support incorporation and standalone risk, rather than mechanically treating the issuer as having the same credit as HMG.

The industry environment is not solely favourable. In February 2025, the South Korean government announced that preferential card fee rates for small and medium-sized merchants with annual sales of KRW 3 billion or less would be reduced by 0.05 to 0.10 percentage points, and that existing fee rates would be maintained for the next three years for general merchants with annual sales of KRW 100 billion or less, even if there are factors that would otherwise raise card fee rates. This policy reduces the burden on merchants, but for card companies it represents a cap on fee income. Even for a company such as Hyundai Card that is growing transaction volume, lower unit merchant fees mean that transaction volume growth does not translate directly into earnings growth.

In summary, Hyundai Card is a leading player in the South Korean card market, with a strong member base, credit purchase volume, PLCC business, and relationship with HMG. However, these strengths do not fully neutralise fee regulation or the household credit cycle.

3. Segment Assessment

For practical purposes, Hyundai Card’s business should be viewed in terms of credit purchases, financial products, investment finance, and other income. The company does not have deposit and lending segments like a bank, and generates revenue mainly from card usage and card receivables. Segment assessment therefore needs to distinguish between businesses that generate stable earnings and those that increase credit costs and funding burdens.

Credit purchases best represent the company’s franchise. Credit purchase volume was KRW 176.6 trillion in 2025 and KRW 44.8 trillion in 1Q 2026. Credit purchases are an entry point into merchant fees, member fees, instalment payments, and related financial products, but merchant fees are constrained by policy. Card income increased to KRW 1.794 trillion in 2025, while card expenses also increased to KRW 1.067 trillion, making the company’s ability to continue converting transaction volume growth into profit a key focus.

Financial products carry both profitability and credit risk. Financial product assets were KRW 8.0 trillion at end-2025 and KRW 8.1 trillion in 1Q 2026, and interest income was KRW 1.668 trillion in 2025. In normal times, card loans and revolving credit are high-yielding, but when employment, interest rates, household debt, and debt restructuring conditions worsen at the same time, delinquencies and credit costs tend to appear first. The 30+ day delinquency ratio in 1Q 2026 was 0.85% excluding refinancing loans and 1.21% including them, so the impact of repayment restructuring and modifications also needs to be monitored.

Investment finance is still small, but it is a monitoring item because it is growing rapidly. Company IR materials show investment finance assets of KRW 262.5 billion at end-2025 and KRW 375.6 billion in 1Q 2026. From a credit perspective, while the balance remains small relative to total managed assets, it is not a core risk. However, unlike traditional card receivables, it may be more dependent on collateral, maturity, concentration, liquidity, valuation, and sponsor credit on a deal-by-deal basis. As the details of deal composition and collateral have not been confirmed at this point, this report treats it conservatively as “a growing non-traditional asset” rather than as a “new earnings source.”

Other income may include valuation and disposal gains on financial assets, foreign exchange and derivative-related items, and data science or partnership-related income. Other income increased significantly in 1Q 2026, but company IR notes state that operating revenue and expenses include foreign exchange and derivative effects, so quarterly other income should not be overestimated as a recurring credit support.

The main business indicators are as follows.

This table shows that credit purchases support the franchise, financial products raise both profitability and risk, and investment finance has become a small but new area requiring monitoring. The key issue is not growth itself, but whether growth is accompanied by lower-risk members, low credit costs, and conservative capital and liquidity management.

4. Financial Profile and Analysis

Hyundai Card’s financial profile shows improving profitability, but with high credit costs and funding costs and sensitivity to funding conditions. From 2022 to 2025, operating revenue increased from KRW 3.016 trillion to KRW 4.008 trillion, operating income from KRW 315.3 billion to KRW 439.3 billion, income before tax from KRW 330.1 billion to KRW 440.6 billion, and net income from KRW 254.0 billion to KRW 350.3 billion. This indicates that the company maintained a certain level of earnings power even in 2025, when industry-wide profit was under pressure.

However, earnings quality needs to be analysed by component. In 2025, card income was KRW 1.794 trillion and interest income was KRW 1.668 trillion. Growth in interest income is affected by financial product balances and the interest rate environment, so from a credit perspective it is both an earnings support and a potential precursor to higher credit costs. Bad debt expense was KRW 614.2 billion in 2025, up slightly from KRW 604.4 billion in 2024. Compared with KRW 432.3 billion in 2022 and KRW 453.0 billion in 2023, the level of credit costs has clearly increased.

Key financial indicators are as follows.

The increase in 2025 profit reflected controlled growth in operating expenses and resilient card income and interest income, rather than a large increase in operating revenue. In 2024, operating revenue increased significantly, but operating expenses also rose. In 2025, operating revenue rose only 1.1% year on year, while operating expenses were contained to a 0.3% increase, raising operating income and income before tax. This can be viewed positively as an improvement in efficiency. However, it remains necessary to confirm whether cost control is sustainable, or whether some expenses or credit costs have been deferred into the future.

On the asset side, card assets are the centre of credit analysis. At end-2025, total assets were KRW 26.999 trillion and card assets were KRW 22.886 trillion, accounting for most of total assets. Card assets increased from KRW 20.605 trillion in 2022 to KRW 20.764 trillion in 2023, KRW 22.662 trillion in 2024, and KRW 22.886 trillion in 2025. In 1Q 2026, they were KRW 23.008 trillion. While asset expansion supports earnings, for a deposit-free card company, asset expansion almost directly increases the amount of market funding, leverage, and liquidity buffers required.

Asset quality is the most important factor supporting the company’s credit quality. In company IR materials, the 30+ day delinquency ratio was 0.63% in 2023, 0.78% in 2024, 0.79% in 2025, and 0.85% in 1Q 2026. Including refinancing loans, it was 0.97% in 2023, 1.08% in 2024, 1.16% in 2025, and 1.21% in 1Q 2026. The NPL coverage ratio was high, at 514.7% in 2023, 451.0% in 2024, 457.8% in 2025, and 457.7% in 1Q 2026.

These figures indicate that the absolute level of delinquencies is managed, but the upward direction cannot be ignored. From 2023 to 1Q 2026, both the delinquency ratio excluding refinancing loans and the ratio including refinancing loans have gradually increased. Bad debt expense has also risen to the KRW 600 billion range since 2024. For card companies, even a small rise in delinquencies can have a large effect on financial product balances and credit costs. Therefore, while the current low delinquency ratio is positive, the direction should be viewed cautiously.

The financial supports for Hyundai Card are its earnings level, adjusted capital ratio, leverage management, and provisioning coverage. Constraints are the potential for higher credit costs, high interest expenses, market funding dependence, and pressure from regulated fees. The 2025 results showed that the company can grow earnings despite industry headwinds, but if the card industry credit cycle worsens, recent years’ earnings growth should not simply be extrapolated into the future.

5. Structural Considerations for Bondholders

The first structural issue for bondholders to confirm is that Hyundai Card’s debt is not debt of Hyundai Motor Company. Hyundai Card is a strategically important card company under HMG, and HMG-related companies own most of its shares. However, at least in the public materials reviewed for this report, it has not been confirmed that Hyundai Card’s foreign-currency bonds or unsecured bonds are explicitly guaranteed by Hyundai Motor Company or Kia Corporation.

In the shareholder structure in the 2025 audited financial statements, direct HMG-related ownership is 78.04%. JCR cites this degree of control and involvement, directors from HMG, and strategic importance in supporting HMG’s automobile sales from a financing perspective as rating rationale. However, rating support incorporation and a legal guarantee are different. In the absence of an explicit guarantee, support is based on economic rationality and reputation, not on bondholders’ legal rights.

The borrowings and bonds notes in the audited financial statements disclose KRW 20.092 trillion of borrowings at end-2025, consisting of bonds, short-term bonds, borrowings, and other funding. Unsecured bonds are described as repayable either in instalments or at maturity. At end-2025, short-term bonds of KRW 710.0 billion and bonds maturing within one year of KRW 4.728 trillion were disclosed. This means the company must continually refinance in the market. The total liquidity of KRW 4.2 trillion in the 1Q 2026 IR materials differs in timing and definition, so it should not be mechanically netted against these figures to assess short-term coverage. The maturity, currency, hedging, covenants, collateral, cross-default, and change of control provisions of individual bonds need to be checked separately from issuer credit.

The structural risks for securities holders are that the issuer has no deposits and depends on market funding, that some assets move into securitisation structures through ABS, and that HMG support expectations are not contractual guarantees for foreign-currency bonds. Structural support comes from Hyundai Card’s strategic importance to HMG in customer contact, payments, card members, data, and complementary sales finance. Bondholders should assess this support expectation as credit enhancement, while first focusing on standalone leverage, liquidity, maturities, delinquencies, and credit costs.

This report has not reviewed the offering circular, pricing supplement, negative pledge, cross default, change of control, tax gross-up, governing law, jurisdiction, pari passu clause, or secured debt limitations for individual HYNCRD foreign-currency bonds. Therefore, the structural assessment in this report is limited to the issuer level. Review of terms and conditions is essential before investing in individual bonds.

6. Capital Structure, Liquidity and Funding

Hyundai Card’s capital and liquidity analysis should focus not on bank deposits and LCR, but on market funding, ABS, CP, bonds, foreign-currency funding, asset-liability maturity gaps, and liquidity buffers as a specialty credit finance company. The company’s IR materials show total liquidity of KRW 4.2 trillion, debt balance of KRW 20.3 trillion, and funding composition of 78.0% bonds, 13.9% ABS, 1.6% CP/STB, and 6.5% general borrowings as of 1Q 2026. Overseas funding was KRW 3.6 trillion, or 17.7% of total debt balance.

A funding structure centred on bonds can secure tenor and investor diversification in normal times. At the same time, for a market-funded non-bank, rating outlook, interest rates, credit spreads, foreign-currency hedging costs, and market liquidity translate directly into refinancing terms.

The funding structure is as follows.

The decline in the CP/STB ratio to 1.6% as of 1Q 2026 is positive. At the same time, the high bond ratio means that confidence from bond investors and ratings are directly linked to funding. If rating outlook weakens due to deterioration in delinquencies or leverage, funding costs would rise and pressure earnings and capital generation.

On foreign-currency funding, the audited financial statements explain that foreign exchange risk is hedged through forward foreign exchange contracts with the same period as interest and principal payments on foreign-currency bonds. However, the existence of hedging does not mean there are no hedging costs, counterparty risks, collateral posting requirements, or rollover risks.

On capital, the adjusted capital ratio and leverage are the central metrics. According to the audited financial statements, credit card companies are required to maintain an adjusted capital ratio of at least 8%, and Hyundai Card’s ratio was 16.79% at end-2025. Leverage was 6.4x at both end-2025 and 1Q 2026, leaving headroom against the 8x ceiling shown in company IR materials and the 7x guidance referred to by JCR. However, asset growth, dividends, hybrid securities, provisions, and credit costs could reduce this headroom.

On liquidity, JCR stated in its March 2026 materials that Hyundai Card’s won liquidity ratio at end-September 2025 was over 400% against guidance of 100%, and that there was no particular concern regarding liquidity. The total liquidity of KRW 4.2 trillion, survival ratio standard of six months, and ALM ratio standard of 125% in company IR materials also indicate a management framework. However, total liquidity of KRW 4.2 trillion is a company IR management metric, and this report has not confirmed the breakdown among cash, securities, credit lines, and other sources. It also differs in timing and definition from the KRW 4.728 trillion of bonds maturing within one year at end-2025, so it should not be used in a simple comparison to conclude that short-term maturities are or are not fully covered. External investors should confirm the breakdown of total liquidity, usage restrictions, currency-specific availability, and matching against maturity-bucketed outflows. The aggregate amount alone does not show the quality of liquidity that is actually usable under stress.

In summary, there is no major warning signal at present in capital and liquidity. However, the funding model is inherently market-dependent, and credit deterioration can readily feed through in sequence to delinquencies and credit costs, rating outlook, funding costs, and consumption of liquidity buffers.

7. Rating Agency View

Hyundai Card’s ratings are high, but they need to be read by scale. Domestic rating agencies indicate relative credit standing in the Korean domestic bond market, while international rating agencies assess the company on a foreign-currency / international investor scale. JCR’s AA- foreign-currency long-term issuer rating reflects the Japanese rating scale and JCR’s assessment of group support, and should not be mechanically notch-compared with S&P / Fitch BBB+ or Moody’s Baa1.

The official ratings confirmed as of 2026-05-15 are as follows.

JCR’s report dated 2026-03-03 is the most detailed rating rationale confirmed for this report. JCR views HMG’s group credit quality as equivalent to AA-, and assigns Hyundai Card a rating at the same level as the group credit quality based on HMG’s 78% shareholding, degree of control and involvement, and Hyundai Card’s strategic importance in supporting HMG’s automobile sales from a financing perspective. It also positively assesses approximately 13 million members, about 2.8 million merchants, a low delinquency ratio, an adjusted capital ratio of 16.1% at end-September 2025, leverage of 6.6x, and a won liquidity ratio above 400%. The latest full reports from Fitch, S&P, and Moody’s have not been reviewed for this report, so detailed triggers remain unconfirmed.

The important point in rating assessment is that the company’s ratings incorporate not only standalone credit quality but also a significant degree of HMG support expectation. Rating deterioration could occur through both a standalone path, involving deterioration in delinquencies, credit costs, capital, liquidity, leverage, and profitability, and a group-related path, involving changes in HMG’s credit quality, support posture, strategic importance, or ownership structure.

Ratings are directly linked to market funding. Domestic AA+ supports domestic bond demand and funding cost, BBB+ / Baa1 supports foreign-currency bond investors’ investment-grade constraints, and JCR AA- provides a supplementary signal to Japanese and Asian investors. However, high ratings do not guarantee funding access, and if delinquency ratios and credit costs rise, market funding costs may move before any rating change.

8. Credit Positioning

Hyundai Card’s credit positioning should be viewed across three comparison axes: South Korean card companies, HMG-related financial subsidiaries, and international investment-grade non-banks. Live spreads, bond prices, CDS, OAS, and Z-spreads have not been reviewed in this report, so no conclusion is drawn on market relative value. Within South Korean card companies, 2025 credit purchase volume of KRW 176.6 trillion, principal members of 12.667 million, and personal credit purchase market share of 17.5% indicate a leading position. Within HMG-related issuers, Hyundai Capital is a more auto-finance-oriented issuer, while Hyundai Card is centred on cards, consumer credit, and PLCC, meaning asset risk differs even with the same support expectation. As an international investment-grade non-bank, it is in the BBB+ / Baa1 range, but it is more sensitive to market funding and the consumer credit cycle than bank senior debt.

The fundamental strengths and weaknesses are summarised below.

No conclusion is drawn on relative value at this point. Fundamentals are supported by a leading card franchise, HMG support expectations, capital and liquidity, and low delinquencies, but price appropriateness cannot be assessed without confirming maturity, currency, guarantee, liquidity, issue size, spread, covenants, and tax provisions.

9. Key Credit Strengths and Constraints

Factors supporting Hyundai Card’s credit quality are the scale of members and transaction volume, differentiation through PLCC, the likelihood of HMG support, low delinquency ratios, capital and liquidity management, and market funding access. Constraints are deposit-free market funding dependence, the card and consumer finance cycle, merchant fee regulation, the potential for higher credit costs, the fact that parent support expectations are not explicit guarantees, and unconfirmed individual bond terms.

Taken together, Hyundai Card is a “managed card company even on a standalone basis,” but the ceiling and stability of its credit quality depend on the market’s view of HMG support expectations and the market funding environment. Standalone delinquency ratios and capital ratios are sound, but for card companies, funding conditions and credit costs can deteriorate at the same time. Hyundai Card’s credit quality can therefore be framed as a structure underpinned by its member base and group support expectations, while constrained by household debt, regulation, and market funding.

10. Downside Scenarios and Monitoring Triggers

Hyundai Card’s realistic downside scenarios are more likely to arise from the simultaneous accumulation of delinquencies, credit costs, funding costs, and regulatory pressure than from a single acute event. Because card companies have granular and diversified assets, they are relatively resilient to the sudden failure of an individual large borrower. Conversely, if household income, employment, interest rates, consumption, and regulation deteriorate, credit costs can rise broadly and gradually, steadily pressuring earnings and capital generation.

The first scenario is deterioration in household debt and consumer credit. In an environment where South Korea’s household debt burden remains high, income growth is slow, and interest burdens are heavy, delinquencies in card loans, cash advances, and revolving credit are likely to rise. Hyundai Card’s 30+ day delinquency ratio is low, but it has been on an upward trend from 2023 to 1Q 2026. The increase to 1.21% including refinancing loans indicates the need to confirm how repayment modifications and restructurings are suppressing delinquency indicators.

The second scenario is earnings pressure from fee regulation and competition. The 2025 reduction in preferential fee rates for small and medium-sized merchants and the freeze on rates for general merchants with annual sales of KRW 100 billion or less impose a structural ceiling on card companies’ fee income. Even if credit purchase volume increases, lower unit fees and higher promotional expenses would weaken the earnings contribution from card income. In that case, the company may be tempted to compensate with financial products or investment finance, but this could increase credit risk.

The third scenario is deterioration in the market funding environment. Hyundai Card has more than KRW 20 trillion of funding, mainly through bonds and ABS. While ratings remain stable, refinancing capacity is likely to be high, but if risk aversion increases in the Korean non-bank market, foreign-currency funding costs rise, hedging costs increase, the CP market shrinks, or ABS investor demand weakens, funding costs would pressure earnings. Interest expense increased from KRW 403.7 billion in 2022 to KRW 737.7 billion in 2025, so funding costs are already an important constraint.

The fourth scenario is a weakening of views on HMG support expectations. Hyundai Card’s ratings incorporate significant HMG support expectations. A decline in HMG’s credit quality, a change in ownership structure, a decline in Hyundai Card’s strategic importance, or doubts over willingness to support could affect ratings or funding terms even if the company’s standalone delinquency ratio has not deteriorated significantly. Conversely, as long as HMG’s credit quality remains stable and the strategic importance of the card business is maintained, support expectations will underpin credit quality.

The fifth scenario is risk expansion in investment finance and non-traditional businesses. Investment finance assets remain small, but they are growing rapidly. If assets with different risks from card receivables increase, details of collateral, concentration, maturity, valuation, liquidity, and legal protection need to be confirmed. Data science and AI-related businesses may be attractive as a growth story, but in credit analysis they should not be overestimated as support unless revenue contribution, fixed costs, contract continuity, and cyber / data regulatory risks are confirmed.

Monitoring items are as follows.

The largest unconfirmed items as of this report are individual bond terms and live market levels. As an issuer, Hyundai Card can be treated as a leading investment-grade card company based on its ratings and disclosed financials. However, in foreign-currency bond investment, the presence or absence of a guarantee, collateral, pari passu status, negative pledge, cross default, change of control, tax gross-up, governing law, maturity, currency, and spread directly affect the investment decision. These are beyond the scope of an issuer summary, but must be confirmed before actual trading.

11. Credit View and Monitoring Focus

Hyundai Card’s current credit quality is relatively high as an investment-grade non-bank supported by rating-incorporated HMG support expectations, but it is not a credit protected by a deposit base like bank senior debt. The credit direction appears stable, but it is necessary to confirm further stabilisation in delinquency ratios, delinquency ratios including refinancing loans, credit costs, and funding costs before concluding that it is improving. Although profit increased in 2025, net income ROA declined to 1.1% in 1Q 2026 and the 30+ day delinquency ratio also increased, so the current situation should not be treated as a phase of rapid improvement. The likelihood of a sharp change in level or direction over a short period is not high at present, but if Korean household credit, card industry regulation, the market funding environment, and views on HMG support expectations deteriorate simultaneously, credit assessment could change relatively quickly through funding costs and rating outlook.

The central supports for credit quality are the member base, credit purchase volume, PLCC, relationship with HMG, low delinquency ratio, adjusted capital ratio in the 16% range, leverage in the 6x range, and high domestic and international ratings. The fact that the company secured income before tax of KRW 440.6 billion and net income of KRW 350.3 billion in 2025 is positive, considering the earnings pressure on the overall card industry. In 1Q 2026, managed assets, principal members, and credit purchase volume also increased, while capital and leverage retained regulatory headroom.

At the same time, the constraints are clear. Hyundai Card has no deposits and needs to refinance more than KRW 20 trillion of borrowings through bonds, ABS, CP, and loans. Interest expense rose significantly from 2022 to 2025. Credit costs have also been high since 2024, and the 30+ day delinquency ratio, while low, is rising. Merchant fee regulation limits the conversion of transaction volume growth into profit, and household debt management could constrain growth in financial products. Rating-incorporated HMG support expectations are an important credit enhancement, but they are not an explicit guarantee.

From an investor perspective, Hyundai Card can be placed on the relatively strong side among Korean non-banks from a senior unsecured issuer credit standpoint. However, market levels are needed to assess relative value, and this report does not make a buy / sell / hold spread judgment. For foreign-currency bonds, the BBB+ / Baa1 international ratings, JCR AA-, and HMG support expectations are supportive, but market funding dependence and sensitivity to the consumer credit cycle should be viewed as higher than for bank senior debt. In comparison with Hyundai Capital and other Korean card companies, HMG support expectations, card asset quality, funding composition, and spread differentials need to be checked together.

Future updates should first monitor delinquencies, credit costs, and delinquency indicators including refinancing loans. Second, they should assess whether growth in financial products and investment finance balances is accompanied by credit costs. Third, they should review maturities, funding costs, and the quality of liquidity buffers for bonds, ABS, CP, and foreign-currency funding. Fourth, they should monitor the assessment of HMG support expectations and the outlooks of domestic and international ratings. Fifth, they should assess how changes in merchant fee regulation and household debt regulation affect credit purchase revenue and financial product balances.

The current conclusion is that Hyundai Card is a “non-bank whose investment-grade profile is supported by its card franchise and capital / liquidity management, against the backdrop of rating-incorporated HMG support expectations.” Its weaknesses are deposit-free market funding dependence, the consumer credit cycle, and regulatory pressure on revenue. In the near term, the key risk is less a sudden credit deterioration than a gradual rise in delinquencies, credit costs, and funding costs, with delayed reflection in ratings and spreads.

12. Short Summary & Conclusion

Hyundai Card is a major South Korean credit card company under Hyundai Motor Group and a market-funded non-bank whose PLCC business, member base, credit purchase volume, relationship with HMG, and support expectations are viewed as credit enhancements. Based on the 2025 results and 1Q 2026 disclosures, earnings, capital, leverage, and delinquency ratios are managed at levels consistent with an investment-grade issuer, but the structure remains dependent on bonds, ABS, CP, and foreign-currency funding without deposits. It is an issuer that requires continued monitoring of HMG support expectations, which are not explicit guarantees, Korean household debt, merchant fee regulation, credit costs, and funding markets.

13. Sources

Primary Company Sources

• Hyundai Card, Investor Presentation FY 2026 1Q, 2026. https://www.hyundaicard.com/upload/ir/event/1Q26_HCC_Presentation_Web_ENG_vF.pdf
• Hyundai Card, Investor Presentation FY 2025 4Q, 2026. https://www.hyundaicard.com/upload/ir/event/4Q25_HCC_Presentation_Web_ENG_%EC%B5%9C%EC%A2%85%EA%B2%8C%EC%8B%9C%28%EB%B3%B4%EC%95%88%ED%95%B4%EC%A0%9C%29.pdf
• Hyundai Card Co., Ltd. and Subsidiaries, Consolidated Financial Statements, December 31, 2025 and 2024. https://www.hyundaicard.com/upload/ir/event/Hyundai%20Card_Con_254Q_signed.pdf
• Hyundai Card, Credit Ratings, accessed 2026-05-15. https://www.hyundaicard.com/about/cei/fi/ceifi0401_01.hc
• Hyundai Card, Audit Report, accessed 2026-05-15. https://www.hyundaicard.com/about/cei/fi/ceifi0201_01.hc

Rating Sources

• Japan Credit Rating Agency, JCR Affirmed AA-/Stable FC Long-term Issuer Rating on Hyundai Card, 2026-03-03. https://www.jcr.co.jp/download/00867f0772054df2b47474c70d875ff2f54b4b087097495557/25i0121_f.pdf
• Hyundai Motor Group newsroom, Hyundai Card's JCR credit rating upgraded, 2024-12-18. https://www.hyundaimotorgroup.com/ko/news/CONT0000000000166694
• Hyundai Motor Group newsroom, Hyundai Card upgraded by Korea Ratings to AA+ Stable, 2024-11-04. https://www.hyundaimotorgroup.com/ko/news/CONT0000000000163978
• Hyundai Motor Group newsroom, Hyundai Card upgraded by KIS to AA+ Stable, 2024-09-11. https://www.hyundaimotorgroup.com/ko/news/CONT0000000000160810

Industry And Regulatory Sources

• Yonhap News Agency, Credit card industry's 2025 net dips 9 pct on cost increases, 2026-03-19, citing Financial Supervisory Service data. https://m-en.yna.co.kr/view/AEN20260319003200320
• Republic of Korea policy portal / Financial Services Commission, Small and medium merchant credit and debit card fee rate reductions, 2025-02-19. https://www.korea.kr/news/policyNewsView.do?newsId=148939735
• Republic of Korea policy portal / Financial Services Commission, Credit card merchant fee rates reduced by up to 0.1 percentage point for small and medium merchants, 2025-02-13. https://www.korea.kr/news/policyNewsView.do?newsId=148939594

Internal Working Materials Referenced

• issuer_summary/issuers/hyundai_card/working/hyundai_card_20260515_writing_plan.md
• issuer_summary/issuers/hyundai_card/data/hyundai_card_source_extract_20260515.json

Unverified / Pending Items