Shinhan Financial Group is actively expanding its overseas business to diversify its profit-taking sources and benchmarking high-end skills in advanced markets under its vision to become the No. 1 first-tier financial services firm in Korea.

Its renovation in a variety of segments over the past few years has been linked to marked profitability.

In its regulatory filing on Tuesday, Shinhan Financial reported a net profit of 558.4 billion won ($531 million) during the first quarter, up 16.1 percent on-year. The figure reflected a 62.7 percent growth over the previous quarter.

Its flagship unit Shinhan Bank posted 425.1 billion won in net profit, up 25.8 percent on-year. It marked a 50.1 percent growth compared to the previous quarter.

Research analysts said its performance is attributable to the steady growth of loan assets issued to corporate and retail customers with high financial soundness. They also cited preemptive risk management for the lender’s success.

The commercial bank saw its loan delinquency ratio drop to 0.44 percent from 0.71 percent a quarter earlier and its nonperforming loans fall 0.03 percentage point to 1.15 percent over the same period.

The financial group has recently embarked on its process to bolster the nonbanking sector.

“It is necessary for us to seek opportunities to expand the scale of our securities and insurance sector, which have been weaker than our banking and credit card businesses,” a spokesman said.

He said its banking and credit card sectors have secured competitiveness thanks to mergers and acquisitions.

Group chairman Han Dong-woo earlier reiterated that the group will continue to find a niche in overseas markets. “Advancing into foreign markets is an inevitable choice.”

“Shinhan has pushed to become a global player based in the Asian region,” he said. “Performances are being realized in countries such as Japan and Vietnam.”

Evaluating its credit card business in Vietnam as a success, he said the group will take the initiative in upgrading Korea’s financial industry by steadily enhancing schemes for globalization.

The group has also introduced a fresh business concept that connects units such as banks and brokerages.

While its bank and brokerage units operate separately, a subgroup was formed to work for the independent entity combining the specialties of the two major units of the financial group.

The combined services are mainly focused on “wealth management” and “corporate investment banking.”

For retail customers, the new staff of the wealth management business division offers services such as investment and financial advice.

Corporate customers are able to enjoy preemptive risk management tools in consultation with the entity’s CIB business division for procurement and settlement services.

The two Shinhan units as well as their parent Shinhan Financial Group predict the wealth management and corporate investment banking businesses will offer high-end customer value and play a significant role in future growth potential.

By Kim Yon-se (kys@heraldcorp.com)