Kakao Bank bottom line booms on commission haul
Kakao Bank’s net profit increased by 600 percent on year to 40.6 billion won ($35.5 million) in the third quarter, as more customers opened stock accounts and applied for credit cards via the online bank, the company announced Wednesday.
The bank reported a net profit of 85.9 billion won this year through September, up 457.8 percent from the same period a year earlier.
Net profits were led by its non-interest business, with increase in commissions from credit card and stock accounts.
The bank posted 4.1-billion-won net profit from commissions in the third quarter and a net profit of 370 million won from commissions this year through September. This is a huge turnaround compared to last year, when it recorded 39.1 billion won in accumulated losses from January through September.
The bank’s net interest income through September was 290.8 billion won, up 67.9 percent from the corresponding period a year earlier. Its net interest margin was 1.64 percent.
Total loans outstanding reached 18.73 trillion won as of September. During the three-month period, 1.4 trillion won new loans were issued.
The total assets were 25 trillion won.
The two financial business of Kakao Group — Kakao Pay and Kakao Bank — came under fire by local media Wednesday for failing to register with the Ministry of Science and ICT as a value-added telecommunication business, which is stipulated in Article 22 of Korea’s Telecommunications Business Act.
The ICT Ministry confirmed Kakao Pay reported late to the ministry, on Nov. 2.
Kakao Bank said while the bank is “not subject to the regulations” as it is classified as a bank, it will “legally review the matter and register with the ministry if necessary.”
BY KANG JAE-EUN [firstname.lastname@example.org]