Financial groups log record net income amid noninterest income portfolio diversification

Headquarters of Shinhan, Woori, KB Kookmin and Hana / Korea Times file

The country’s four leading financial groups have registered record net income, underpinned by robust growth in noninterest incomes, market watchers said Friday.

Shinhan Financial Group posted an all-time-high net income of over 3 trillion won ($2.1 billion) in the first half of this year.

Interest income declines were offset by loan growth. Fee income from brokerage and investment banking services also helped.

The group’s net income for the second quarter came to over 1.54 trillion won, up 8.7 percent from the previous year. The highest second-quarter figure was up 4.1 percent from the previous quarter.

Its net income for the first six months came to over 3.03 trillion won, up 10.6 percent from a year earlier.

The group said its strong net profit was explained by growth in loan assets, fees and securities trading, all part of noninterest incomes.

“We had to beef up provisions amid economic slowdown. But one-off expenses such as equity-linked securities provisions were factored out, contributing to the strong first-half earnings.”

Hana Financial Group also posted a net income of over 2.3 trillion won in the first six months of this year, a record first half year figure.

Hana’s net income from April-June came to over 1.17 trillion won, up 13.4 percent from the previous year.

This was the highest quarterly figure since the first quarter of 2012 when it hit over 1.29 trillion won.

Net income in the first six months of this year came to over 2.3 trillion won, up 11.2 percent from the previous year.

Hana’s “core” income, including interest and fee income, came to over 5.57 trillion won, up 2.9 percent from the previous year.

Interest income came to over 4.49 trillion won, up 2.5 percent from a year earlier.

Woori Financial Group said its net income in the April-June period came to 934.6 billion won, up 0.3 percent from the previous year. This was the group's highest second-quarter profit to date.

Its net income in the first six months came to over 1.55 trillion won, down 11.6 percent from the previous year.

Its strong performance was driven by an increase in fee incomes.

KB Financial Group also reported an all-time high quarterly and half-year performance.

KB said Thursday that its net profit in the April-June period came to over 1.73 trillion won, up 0.3 percent from a year earlier and up 2.4 percent from three months earlier. The second quarter figure was its strongest quarterly performance to date.

The group’s net income in the first six months came to over 3.43 trillion won, up 23.8 percent from the previous year.

Interest income declined due to falling interest rates amid monetary easing. However, brokerage services over months of a bullish stock market bolstered fee income. This, together with last year’s equity-linked securities provision costs factored out, led to strong growth.