Banks' Q1 net up nearly 29% on base effect

Bank loan programs are seen on the exterior of a lender in Seoul, May 13. Yonhap

Korean banks' combined net profit jumped nearly 29 percent from a year earlier in the first quarter of the year on a base effect, data showed Friday.

The combined net profit of 20 banks came to 6.9 trillion won ($5.01 billion) in the January-March period, up from 5.3 trillion won a year earlier, according to the data from the Financial Supervisory Service (FSS).

Their interest income came to 14.8 trillion won in the first quarter, up 100 billion won, or 0.8 percent, from a year earlier.

Non-interest income came to 2 trillion won, up 100 billion won, or 6.6 percent, over the cited period, according to the FSS.

But the absence of massive costs, such as the estimated 1.8 trillion won spent last year to compensate improper sales of equity-linked securities, helped jack up their bottom line, it added.

The banks set aside 1.6 trillion won in loan-loss reserves in the first quarter, up 300 billion won, or 24 percent, from a year before.

The banks' return on assets ratio rose to 0.71 percent in the first quarter from the 0.57 percent a year earlier, while their return on equity ratio rose 1.75 percentage points to 9.55 percent over the cited period.