Financial groups report a mixed third quarter as some fall short

From left to right are office buildings of KB Financial Group, Shinhan Financial Group, Hana Financial Group and Woori Financial Group. [KB, SHINHAN, HANA, WOORI]

Financial groups have reported a mixed bag of results with some beating and some missing expectations in the third quarter.

KB Financial Group reported 1.26 trillion won ($880 million) in net profit in the third quarter, down 3.22 percent on year, according to its preliminary earnings report Tuesday. In the year through September, net profit was 4.04 trillion won, up 6.25 percent.

Operating profit was 1.6 trillion won, down 10.55 percent on year and missing the 1.77 trillion won FnGuide market consensus.

KB Bank reported 824.2 billion won in quarterly net profit on a “solid increase in interest profit” and investment banking commissions, up 56.1 percent on year.

Shinhan Financial Group reported 1.62 trillion won in net profit in the July-September period, up 41.69 percent on year, according to the preliminary earnings report Tuesday. In the year through September, the company’s net profit was up 20.36 percent on year.

Operating profit rose 3.88 percent in the third quarter on year to 1.67 trillion won, lower than 1.85 trillion won FnGuide consensus.

“The net interest margin continued to improve from the rise of the base interest rate,” said the company in a statement.

The margin, the difference between interest income earned and the interest paid by a bank, reached 1.68 percent in the third quarter from 1.45 percent in the fourth quarter of last year, it said.

The Bank of Korea raised the base rate to 3 percent on Oct. 12. It is up 2.5 percentage points since August last year. The central bank is expected to deliver another rate increase next month, which will be the last Monetary Policy Board meeting this year.

The 444 billion won earned from sales of Shinhan Securities office in Yeouido, western Seoul, in July, also helped boost the profit.

Hana Financial Group's net profit increased 20.56 percent in the third quarter to 1.14 trillion won. In the year through September, net profit was 2.9 trillion won, up 6.28 percent in the same period.

Its operating profit in the third quarter was 1.47 trillion won, beating the 1.32 trillion-won market consensus.

Woori Financial Group reported 933.39 billion won in net profit in the third quarter, up 13.22 percent on year. Its net profit in the year through September jumped 18.25 percent to 2.79 trillion won.

Its operating profit in the third quarter was 1.27 trillion won, up 16.38 percent on year, but slightly short of the 1.25-trillion-won market consensus.

Woori Financial Group “is focusing on strengthening risk management capacities and strengthening substantial management, as uncertain economic conditions are projected to continue through 2023 inside and outside of Korea,” said Son Tae-seung, the company chairman, in a statement.

BY JIN MIN-JI [jin.minji@joongang.co.kr]