By Kim Tae-gyu
Staff Reporter
Companies that recover fast from the economic recessions are really strong ones ― if this time-honored belief is true, Korea Investment & Securities could be one of the most robust brokerage houses here.
As far as profitability is concerned, Korea Investment stands out here as the firm netted 69.4 billion won during the July-September period of this year, the biggest in the local equities industry.
The Seoul-based outfit also jacked up its own capital by the biggest margin of 225.1 billion won during the second quarter of the fiscal year 2009 to 2.1 trillion won as of the end of September.
``During the second quarter, stock transactions were reduced by 7 percent from the previous quarter and this explains why major brokerages lost around 30 percent of their profits,'' Korea Investment CEO Ryu Sang-ho said.
``However, Korea Investment maintained its net profits almost flat during the first two quarters of this year. We believe that the consistent performances demonstrate the health of our business portfolio,'' he said.
Indeed, a majority of competitors suffered jitters in their bottom lines over the second quarter.
Samsung Securities suffered from a 27.8-percent drop in net profits while Daewoo Securities and Shinhan Investment Corp. faced 45.1-percent and 55.3-percent dips, respectively.
``We diversified our business portfolio to investment banking services and a variety of financial products rather than depending solely on the traditional revenue streams from equities transactions,'' Ryu said.
Over the second quarter, the stock transactions and associated consulting division accounted for merely 41 percent of Korea Investment sales while the proportions were upside of 50 percent for other players such as Samsung, Daewoo and Shinhan.
Up to 36 percent of the firm's quarterly revenues came from investment banking services while the remaining 23 percent were chalked up in other financial products.