SOUTH KOREA FIRST TO MARKET

研报英文原文证据摘录

SOUTH KOREA FIRST TO MARKET

Asia Pacific Equity Research

South Korea First to Market 30 June 2026

Top Stories

Korea Banks (Jihyun Cho)

Key takeaways from recent investor meetings: increasing interest in FGs with enhanced ROE

We have met with investors across Europe and Asia in recent weeks. Against an AI-led rally and heightened volatility, investors

are actively looking for non-AI ideas to diversify. Most agree with our ROE-led re-rating thesis, but the pushback has shifted to

near-term catalysts and potential downside risks. Key questions centered on: (1) the durability of the recent fee income

uptrend, (2) NIM sensitivity to rate expectations, (3) incremental upside to shareholder returns after 2025’s dramatic TSR hikes,

and (4) asset quality as rates rise. Notably, investor behavior appears to be more catalyst-driven than in prior cycles—likely

reflecting higher opportunity costs in a fast-moving market, rather than preemptive positioning. However, ahead of a 2Q

reporting season with positives (strong earnings and sizable buyback/cancellation programs to be announced), we

see this as a good buying opportunity to accumulate Korean financial groups (FGs), particularly KB/Shinhan/Hana (all

OW), as ROE should trend towards 11–12% medium term (vs. 9–10% today) on stronger fee income and resilient interest

income in a higher-rate environment. Valuation remains undemanding at <1.0x P/B, supporting a more extended re-rating.

Korea Healthcare (Jihyun Cho)

Investor feedback from Europe and Asia: weak sentiment for now, but awaiting near-term reversal

Risk appetite for Korean equities remains strong, but investor engagement in healthcare has been limited amid an AI-led rally

and a higher-rate backdrop, which has tightened funding conditions for R&D and capacity expansion.