Boutique-type investment banks in South Korea swung to a loss in the first quarter of fiscal 2012, mainly due to a decrease in commissions income and securities investment, the financial regulator said Thursday.
The combined net loss of 152 local and foreign boutique-type financial firms operating here reached 21.1 billion won ($18.6 million) in the April-June period, a turnaround from a net profit of 35.0 billion won three months earlier, according to the Financial Supervisory Service (FSS). They close their books on March 31.
The firms basked in on-quarter profits in the previous three quarters, before they went into the red during the April-June period, the FSS said.
The net loss came as the boutique-type firms suffered a downturn in their investment contracts on a slump in the local stock market.
The value of their outstanding investment contracts stood at 23.3 trillion won as of the end of June, down 4.9 trillion won from a year earlier.
Their combined operating profit almost halved to 59.3 billion won, as their commissions income dropped by 43.5 billion won over the cited period, the FSS said.
Their combined assets totaled 672.6 billion won, down 32.4 billion won from the previous quarter. Their equity capital slipped by 18.3 billion won to 599.6 billion won, according to the regulator. (Yonhap)