By Lee Kyung-min
Credit card units of Korea's four largest financial groups posted a combined 242.2 billion won ($209 million) net profit in the first quarter of 2019, a 12.1 percent drop from a year earlier, data showed Friday.
They are card subsidiaries of Korea's four financial groups ― Shinhan, Woori, KEB Hana and KB Kookmin.
Their net profit may well drop further over the coming months given the ongoing conflict over a hike in card transaction fees, a thorny issue involving card firms and their more "lucrative" partners including large retailers and telecom firms.
Such a bleak outlook is fueled as their could-have-been-worse performance in the three-month period was offset partly by January's figures when the firms had yet to lower transaction fees, following the government's revision to cut the fees to unburden small- and medium-sized enterprises (SMEs).
Of the four, the top market player Shinhan posted a net income of 122 billion won in the first three months of 2019, a 12.2 percent drop from the previous year.
Woori's figure dropped to 24 billion won in the same period, a 38.9 percent decrease from 39.3 billion won the year before.
KEB Hana saw the net income drop to 18.2 billion won, a 28.4 percent drop from 25.5 billion won from a year earlier.
KB Kookmin was the only firm that saw its net income increase to 78 billion won, an 8.8 percent jump from 71.7 billion the year before.
However, the seemingly "fine" performance came mostly from reducing other business expenses as part of overall firm-wide cost-saving efforts.
With the fee income likely to drop further, many card firms are seeking to diversify their portfolios to find a new source of profit.
Shinhan has been boosting other financing programs, through which a substantial profit has been drawn over the past few years.
Via a car financing program, the firm posted 42.3 billion won in operating profit in the first three months of 2019, a 71.1 percent increase from the year before.
Other financing programs saw 30.4 billion won in operating profit in the same period, an 18.9 percent increase from a year earlier.
The card fee feud began after the Financial Services Commission revised the system to have "larger, lucrative" businesses pay more following an outcry from the self-employed and SMEs that claimed fee transactions were unreasonably impacting their bottom lines.
Credit card units of Korea's four largest financial groups posted a combined 242.2 billion won ($209 million) net profit in the first quarter of 2019, a 12.1 percent drop from a year earlier, data showed Friday.
They are card subsidiaries of Korea's four financial groups ― Shinhan, Woori, KEB Hana and KB Kookmin.
Their net profit may well drop further over the coming months given the ongoing conflict over a hike in card transaction fees, a thorny issue involving card firms and their more "lucrative" partners including large retailers and telecom firms.
Such a bleak outlook is fueled as their could-have-been-worse performance in the three-month period was offset partly by January's figures when the firms had yet to lower transaction fees, following the government's revision to cut the fees to unburden small- and medium-sized enterprises (SMEs).
Of the four, the top market player Shinhan posted a net income of 122 billion won in the first three months of 2019, a 12.2 percent drop from the previous year.
Woori's figure dropped to 24 billion won in the same period, a 38.9 percent decrease from 39.3 billion won the year before.
KEB Hana saw the net income drop to 18.2 billion won, a 28.4 percent drop from 25.5 billion won from a year earlier.
KB Kookmin was the only firm that saw its net income increase to 78 billion won, an 8.8 percent jump from 71.7 billion the year before.
However, the seemingly "fine" performance came mostly from reducing other business expenses as part of overall firm-wide cost-saving efforts.
With the fee income likely to drop further, many card firms are seeking to diversify their portfolios to find a new source of profit.
Shinhan has been boosting other financing programs, through which a substantial profit has been drawn over the past few years.
Via a car financing program, the firm posted 42.3 billion won in operating profit in the first three months of 2019, a 71.1 percent increase from the year before.
Other financing programs saw 30.4 billion won in operating profit in the same period, an 18.9 percent increase from a year earlier.
The card fee feud began after the Financial Services Commission revised the system to have "larger, lucrative" businesses pay more following an outcry from the self-employed and SMEs that claimed fee transactions were unreasonably impacting their bottom lines.
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