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Shinhan Financial Group's net profit climbs 3.9% on year in Q3

Published: 25 Oct. 2024, 16:23 Updated: 27 Oct. 2024, 19:00

SHIN HA-NEE
[email protected]

The headquarters building of Shinhan Bank, a flagship subsidiary of Shinhan Financial Group, in Jung District, central Seoul [YONHAP]

Shinhan Financial Group logged a 3.9 percent on-year increase in net profit in the third quarter at 1.24 trillion won ($892.4 million), according to its earnings report on Friday.

The figure fell short of the analyst expectation of 1.33 trillion won compiled by market tracker FnGuide. On a quarterly basis, the net profit dipped 13.1 percent.

The expectation-missing earnings are mainly due to losses in its non-banking business, as Shinhan Securities incurred a massive 135.7 billion won loss caused by unauthorized futures trading by its employees.

“Despite a contraction in non-banking income driven by losses in derivatives trading, we have maintained resilient fundamentals for profit generation with a stable management of loss-absorbing capacity and enhanced cost efficiency,” said Shinhan Financial Group in a release.

Regarding the recent scandal, Shinhan said, “We feel a deep sense of responsibility for such an incident to occur during group-wide efforts to bolster the internal control system, and promise to use this opportunity […] to thoroughly review and refine our system from the ground up.”

This brings the accumulated net profit for this year to 3.99 trillion won, up 4.4 percent from the same period last year. Interest income during the January-September period rose 5.7 percent to 8.49 trillion won.

Quarterly operating profit grew 5.1 percent on year to 1.79 trillion won, also below the market expectation of 1.87 trillion won.

Its net interest margin decreased by 0.09 percentage points on year and 0.05 percentage points from the previous quarter to 1.90 percent.

Shinhan Bank posted a 14.2 percent increase in net profit to 1.05 trillion won, with a net interest margin of 1.56 percent, down 0.07 percentage points on year and 0.04 percentage points on quarter.

BY SHIN HA-NEE [[email protected]]