Net profits for Citbank, SC Korea jump in H1

By Kim Bo-eun

Two major foreign banks here ― Citibank Korea and Standard Chartered (SC) Bank Korea ― saw their net profits increase in the first half of 2019 on the back of their continued efforts to reduce costs and improve productivity.

Citibank Korea enjoyed a decent growth in its net profit for the first half of 2019, amid tougher circumstances surrounding banks here.

Its net profit for the first half of the year totaled 169.6 billion won, up 45 percent from 117 billion won for the same period last year.

The bank said that one of the main contributions was the bank's sale of its headquarters building in central Seoul that took place in the second quarter.

Excluding this factor, the net profit of the second quarter was up 25 percent year-on-year.

Higher trust fees and income from investment and insurance products sales contributed, according to the bank.

It also said expenses for the second quarter decreased from the same period a year earlier due to continued re-engineering efforts.

"We are very pleased with the positive operating leverage in the second quarter of 2019 under a continued challenging external environment,” Citibank Korea CEO Park Jin-hei said in a statement.

"We are seeing a positive momentum in our core businesses such as corporate banking, wealth management and unsecured personal loans which are pivoted to grow sustainably.”

The bank has been continuing efforts to cut costs in the tough environment, closing down nearly 70 percent of its branches here in 2017. The number of Citibank's branches fell from 133 to 90.

The sale of its headquarters building was also seen as a measure to save costs. The bank's employees will be stationed at two rented offices in Seoul by next year.

Meanwhile, SC Bank Korea also posted a year-on-year growth in net profits for the first half of this year.

SC's net profit came down to 150.3 billion won in the first half of the year, a 2.5 percent growth from 146.7 billion won for the same period a year earlier.

Despite the weak performance of its wealth management sector based on a bearish stock market, profit grew on the back of continued interest income growth and non-interest income from disposing of bad loans, according to the bank.

It said expenses were reduced through tight management and efforts to improve productivity.

SC's efforts to save costs have also been notable, with the bank closing nine branches this year.