Kim Yong-beom, vice chairman of Meritz Financial Group, reaffirmed a plan to maximize shareholder value through continued share buybacks and cancellations. In corporate finance, the vice chairman said the firm would continue selective investment in real estate finance while also aggressively pursuing new investment demand tied to artificial intelligence.
According to the financial investment industry on the 13th, Kim said at Meritz Financial Group's second-quarter earnings conference call on the 12th that the company had carried out 3.09 trillion won ($2.2 billion) in share buybacks and cancellations over the three years from March 2023 to this past March.
"Holding one share in March 2023 is equivalent to holding 1.22 shares now," Kim said. "Even without shareholders putting in additional money, the portion of the company that each share represents grows. The more this process repeats, the more the effect compounds." The firm is currently buying back an additional 700 billion won worth of shares through a trust contract.
Kim said there was no change to the roughly 240 billion won in existing provisions and reserves related to Homeplus. For the newly executed debtor-in-possession (DIP) loan, the company expects about 14 billion won in provisions and reserves.
Oh Jong-won, chief risk officer (CRO) of Meritz Financial Group, said the support needed for Homeplus's rehabilitation had already been completed and that the firm expected a good outcome. "The existing loans are secured by trust real estate as collateral, and the DIP loan is protected by collateral from MBK and Chairman Kim Byung-ju," Oh said, adding that the safety of principal and interest recovery was sufficiently secured regardless of the rehabilitation outcome.
Kim Jong-min, chief executive of Meritz Securities, said the securities division delivered strong results through flexible responses to market volatility despite rising interest rates. "The strategy of preemptively expanding equity positions also proved effective, and higher trading gains from expanded exchange-traded fund (ETF) transactions drove the earnings growth," Kim said.
