Online lenders post record net profits from January to September. on
South Korea’s internet-only banks posted record net profit in the first nine months of this year on the back of an increase in new customers amid rising demand for household loans and a rise in interest rates which helped to improve margins on loans and deposits.
K-Bank said on Tuesday its net profit was 16.8 billion won ($14.3 million) for July-September, down from 3.9 billion won in the second quarter and a sharp turnaround from to a net loss of 12.3 billion won in the first quarter. In the first three quarters, the bank posted 8.4 billion won on a net basis, putting the country’s first online-only lender on track for its first annual profit this year.
K-Bank, owned by a consortium of telecommunications giant KT Corp., Woori Bank and 19 other companies, has been in the red every year since its inauguration in April 2017.
Later in the day, Kakao Bank said its cumulative net income over the three quarters of the year hit a record high of 167.9 billion won, up 95% from a year ago. . Third-quarter net profit rose 28 percent year-on-year to 52 billion won.
The strong results of the two online banks were attributed to the increase in lending and deposit spreads with an increase in the number of customers this year when households and businesses borrowed heavily under expansionary monetary policies.
The number of K-Bank customers stood at 6.6 million at the end of September, compared to 2.19 million last year. The bank’s customer deposits increased by 8.51 trillion won to 12.31 trillion won during the cited period, with outstanding loans doubling to 6.18 trillion won.
Kakao Bank under Kakao Corp., the operator of the country’s dominant messaging app, KakaoTalk, said its customers stood at 17.4 million at the end of September, up from 15.44 million at the end of the year. last. The number of monthly active users (MAUs) who log in at least once a month topped 14.7 million, up 670,000 from the second quarter, becoming the country’s largest banking app.
Kakao Bank’s customer deposits rose 5.52 trillion won from the end of last year to 29.06 trillion won, with outstanding loans up 4.72 trillion won to 25.03 trillion won. Kakao Bank debuted in the market in August and became the largest financial institution by market capitalization.
The country’s first-generation mobile-only banks also stood out for non-interest revenue growth.
K-bank’s non-interest revenue for the third quarter snowballed to 8.5 billion won, as its partnership with Upbit, the country’s largest cryptocurrency exchange, led to an increase in the number of customers from K-bank.
Kakao Bank’s non-interest income from platform fees accounted for more than 10% of its total operating profit in the third quarter.
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]