NH Nonghyup Bank to Proceed with 100 Billion KRW Paid-in Capital Increase

Final Resolution at the Extraordinary General Meeting of Shareholders on the 27th

[Asia Economy Reporter Park Sun-mi] NH Nonghyup Bank is planning a paid-in capital increase worth 100 billion KRW to strengthen its capital base.

According to financial sources on the 20th, NH Nonghyup Bank will conduct a paid-in capital increase of 100 billion KRW by issuing 2,702,702 new shares at 37,000 KRW per share (par value 5,000 KRW) to its parent company, NH Nonghyup Financial Group, on the 11th of next month.

Following the approval of the 100 billion KRW paid-in capital increase plan at the Management Committee meeting on the 13th, the Board of Directors gave its final approval on the 18th. Once the final resolution is passed at the extraordinary general meeting of shareholders on the 27th, the paid-in capital increase will be implemented on the 11th of next month, and all related procedures and registration changes are expected to be completed within the year.

The decision by Nonghyup Bank to increase capital was driven by the need to enhance its future loss absorption capacity amid the prolonged COVID-19 pandemic. Although sufficient provisions have been accumulated, the uncertainty over the duration of the pandemic led to the judgment that proactive capital reinforcement is necessary.

A Nonghyup Bank official explained, "This paid-in capital increase is expected not only to improve the BIS ratio, a key capital adequacy indicator, but also to generate an annual net income improvement effect of approximately 1.6 billion KRW. Additionally, it is anticipated to enhance the role of the bank as a profit center for the entire Nonghyup group by strengthening medium- to long-term business competitiveness."

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