Shinhan Financial Group and Hana Financial Group, South Korea’s first and the third largest financial groups by net profit, have established a global partnership to strengthen their global competitiveness, the Korean Economic Daily reported on May 25. 

The MOU is based on their conclusion that they can create synergy as two leading international players. Shinhan Financial Group and Hana Financial Group operate 222 overseas branches and offices in 20 countries and 216 branches in 24 countries respectively.

Shinhan and Hana financial group reported overseas asset worth 41.35 trillion won and 39.90 trillion won respectively. 

Shinhan Financial Group had posted a net profit of 89 billion won ($72.21 million) from overseas for the first quarter. The group’s total revenue for the first quarter was 932.4 billion won. Hana Financial Group had posted a net profit of 113.3 billion won out of 657 billion won from overseas market in the first quarter.

Over the past few years, two companies had been in fierce competition in overseas markets such as China, Vietnam and several other Southeast Asian countries.

Under the Memorandum of Understanding (MOU), the two groups will strengthen global competitiveness and carry global business partnership forward.

They are planning to find and promote joint business opportunities overseas, respond to regulatory issues and invest in new overseas markets such as South America and Africa.  

The two companies did not come up with specific plans for cooperation.

However, it is expected that they will be able to pursue an economy of scale while refraining from competing with each other in overseas markets. (Reporting by Hye-won Chang)