2. Disclaimer
2
These presentation materials have been prepared by Hyundai Card Corporation., Ltd. (“HCC” or “the Company”), solely
for the use at this presentation. This presentation material may not be reproduced, redistributed or passed on, directly
or indirectly, to any other person or published, in whole or in part, for any purpose.
The Company has not taken measures to independently verify data contained in this material. No representations or warranties,
express or implied, are made as to, and no reliance should be placed on, the accuracy, fairness or completeness of the information
presented or contained in this presentation. This presentation should not be construed as legal, tax, investment or other advice.
Financial statements in this document have been prepared in accordance with K-IFRS. Other additional market information has
been sourced from the Company or from other external institutions. The information presented or contained in this presentation
is current as of the date hereof and is subject to change without notice and its accuracy is not guaranteed.
Certain information and statements made in this presentation contain “forward-looking statements.” Caution should be taken
with respect to such statements and you should not place undue reliance on any such forward-looking statements.
3. 3
Key Highlights
Member growth /
Financial product
strategy
Increase in not only members w/ high usage efficiency but also high cost efficiency;
maintained sales of financial products based on a conservative risk policy
PLCC① PLCC, a business only being pursued by HCC, to be a significant competitive edge
providing more members and various data, the foundation for long term growth
Digital
Hyundai Card
Aim to be a differentiated Digital Data Company vs. other financial companies,
continually investing to find opportunities in areas beyond finance
Maintain
income
Net income -29.7% YoY from regulatory profit cuts and higher marketing cost,
but targeting flat YoY income having executed intense cost cut project and
efficiency enhancement actions since 2Q18
※ All key indexes – asset quality, capital adequacy, liquidity – stable
① PLCC : Private Labelled Credit Card
4. 4
Member Expansion
Increased active rate by luring card usage of existing members and tightened attrition management
Cost efficiency lifted from focusing acquisition in low cost (CP, co-brand, etc.) and PLCC partner channels
① Low cost CP, co-brand ② CP, PSC
2016 2017 3Q17 3Q18 YoY
Low cost
channel① 20.3% 36.5% 35.9% 34.1% -1.9%p
PLCC channel 23.4% 21.2% 20.4% 35.4% 15.1%p
High cost
channel② 39.7% 22.8% 23.8% 11.6% -12.2%p
Acquisition
unit cost (KRW)
192K 137K 143K 103K -26.4%
Improved acquisition cost efficiency
- Lowered acquisition unit cost by expanding PLCC,
a channel with high cost efficiency
[ New member acquisition mix by channel ]
(unit: K)
Existing
members
Valid
members
Members
New
members
Attrition
5,554 5,711 5,974 6,472
1,239 1,449 1,076
1,105
6,793
7,160 7,050
7,577
'16 '17 3Q17 3Q18
(+7.5%)
(+5.4%)
1,148 1,041
799
582
5. 5
Financial Product Strategy
Conservative stance maintained on financial product sales preparing for industry-wide credit risk rise
- Enforced risk actions (preemptive cut-off, limit reduction, etc.) in line with market index fluctuations
3.2 3.5 3.8
0.9
0.8
0.7
4.1TN
4.3TN 4.5TN
'16 '17 3Q18
(+3.2%)
(-17.5%)
(+7.5%)
Cash
advance
Card
loan
Financial
total
- Tighter UW policy
: Lowered initial cash advance limit,
differentiated limits by acquisition channel
: Cut-off vulnerable borrowers
- Reinforced early Collection
: Created separate Collection Division,
luring payment in early buckets
Risk actions taken
Financial Product Risk Management
Portfolio composed mostly of relatively lower risk card loan
6. PLCC①
6
PLCC vs. GPCC vs. Co-brand
GPCC②
vs. Co-brand Card
Brand
Partner’s card
(with HCC, exclusive contract)
HCC-Partner card
(non-exclusive contract)
Reward
(discount)
Earn/burn partner’s rewards
(in-store/out-of-store)
(discount promotion in partner
stores, etc.)
Earn/burn M Points
(discount on partner spending, etc.)
Acquisition
Partner’s channel
: CM, Emart stores, etc.
Partner’s channel
: Telecom dealers, etc.
Operation
(UW/servicing)
Dedicated channel and
organization for each partner
Combined operation with HCC
HCC
Earn/burn M Points
(Platinum discount, discount
promotion, etc.)
HCC own channel
: CP, PSC, online, etc.
HCC own channel and organization
① PLCC : Private Labelled Credit Card ② GPCC : General Purchase Credit Card
7. 7
Digitalization – Within Finance
Not only providing separate digital services,
but continually investing to find new business opportunities and enhance operation efficiency
Operation Efficiency
- Introduced AI customer servicing chatbot ‘Buddy’
e.g.) Natural language (Buddy)
: How much do I need to pay this month?
예) Keyword (general) : Tell me my October bill amount
New Business Opportunities
- Captive : Connected Car recognition pay service
e.g.) Providing consulting on Hyundai Wallet (US)
- Payment : Gain additional growth and data opportunities
from merchant B2B financing, etc.
Digital Services
Lock & Limit (‘15.10) Virtual card number (‘15.12)
Payshot (’16.04) Chameleon (‘17.04)
Cross-border remittance (‘18.04)
8. 8
Digital Data Company – Beyond Finance
Possible to amass meaningful big data combining data of HCC and data from PLCC partners
Internalizing big data analysis/utilization capacity having deemed it the crux of Digital business
(AI, machine learning, algorithm, etc.)
ICT①, Commerce, Manufacturing, etc. HCC
Big Data
Gathering
[ HCC members ] [ PLCC : Commerce, manufacturing, retail … ]
Database
Processing
& Analytics
Infrastructure
• Artificial Intelligence
• Machine Learning / Algorithm
• Deep Learning
① ICT : Information and Communication Technology
address
• Expand/process existing DB
- Max 2,000 tags
• Add differentiated DB
- Leverage DB of PLCC partners
9. 9
2018 P&L Strategy
Devote all efforts to defend income by reinforcing acquisition efficiency and enforcing intensive
all-around cost cuts (promotion cost reduction, etc.)
- Reinforced acquisition efficiency
: Acquisition unit cost 137K(‘17) → 103K(3Q18)
- Enhanced promotion cost efficiency
: Promotion cost ratio⑥ 0.37%(‘17) → 0.34%(3Q18)
- Reduced operating cost
: SG&A ratio⑦ 0.78%(‘17) → 0.76%(3Q18)
① ② Excluding FX and derivatives effect ③ One-off tax refund in ’17 ④ Net income/average balance of assets ⑤ Card expense/credit purchase volume of individual customers
⑥ Promotion cost/credit purchase volume of individual customers ⑦ SG&A/total volume
Summary of Income Statement
(unit: BN KRW)
2017 3Q17 3Q18 YoY
Oper. revenue①
2,842.6 2,125.6 2175.0 2.3%
Oper. expense②
2,597.5 1,895.1 2,023.1 6.8%
Card expense 1,372.3 1,000.0 1,045.6 4.6%
Oper. income 258.7 240.3 161.6 -32.7%
IBT 258.8 240.0 164.4 -31.5%
Net income 191.6 181.9 127.8 -29.7%
Excluding
one-off effect③ 152.7 145.2 127.8 -11.9%
ROA④
1.5% 2.0% 1.2% 0.7%p
All-around cost cut efforts
: Card expense ratio⑤ 2.03%(‘17) → 1.98%(3Q18)
