Continuing Bank Stock Shopping Despite Foreign Selling Pressure

Shinhan Financial Group, Hana Financial Group, and Others Hit 52-Week Highs Consecutively Last Week
Stock Prices Rise Amid Strong Earnings and Continued Foreign Buying Pressure

[Asia Economy Reporter Song Hwajeong] While foreigners have recently shown a selling preference causing the index to stall, they continue to maintain a buying stance on bank stocks. As foreign buying pressure continues, the peak prices keep rising.

According to the Korea Exchange on the 3rd, foreigners sold 949.7 billion KRW in the KOSPI market over the past week, marking two consecutive weeks of selling pressure. Despite this sustained selling trend, bank stocks were heavily purchased. Shinhan Financial Group was bought for 90.9 billion KRW, and Hana Financial Group for 63.3 billion KRW, ranking 3rd and 5th respectively in net purchases.

In addition, foreigners also bought shares of Industrial Bank of Korea, KB Financial Group, DGB Financial Group, JB Financial Group, and BNK Financial Group.

Thanks to foreign buying pressure, Shinhan Financial Group showed an upward trend every day except one last week, reaching 40,000 KRW. On the 30th of last month, it rose intraday to 40,450 KRW, marking a 52-week high. This is the first time Shinhan Financial Group closed above 40,000 KRW since the end of January last year. Hana Financial Group also rose for seven trading days from the 22nd to the 30th of last month, continuously setting new 52-week highs and recovering the 45,000 KRW level. On the 30th of last month, it rose intraday to 46,900 KRW. This is the first time Hana Financial Group surpassed 45,000 KRW since October 2018. BNK Financial Group, which has risen continuously recently, also reached an intraday high of 7,790 KRW on the 30th of last month, achieving a 52-week high, and JB Financial Group also rose intraday to 7,430 KRW on the same day, setting a new 52-week high.

The strong performance of bank stocks appears to be a factor behind foreign buying and the stock price strength. Hana Financial Group recorded a controlling shareholder net profit of 834.4 billion KRW in the first quarter, significantly exceeding market expectations (consensus). Shinhan Financial Group posted a first-quarter net profit of 1.1919 trillion KRW, marking the highest quarterly performance ever.

Strong earnings are expected to continue through the second quarter as well. According to SK Securities, the bank loan-deposit interest rate spread in March was 2.12% on a balance basis and 1.91% on a new basis, expanding by 2 basis points compared to the previous month. The bank loan-deposit interest rate spread moves in the same direction as the net interest margin (NIM). SK Securities researcher Koo Kyunghoe said, "The NIM of major bank holding companies in the first quarter rose by an average of 6 basis points compared to the previous quarter, playing an important role in improving interest income," adding, "Considering recent trends in interest rates, deposits, and loans in the financial market, banks' NIM is highly likely to further expand at least through the second quarter."

This content was produced with the assistance of AI translation services.