K-Bank Achieves 'First Profit' in 4 Years Since Launch... Will It Continue in the Second Half?

Kebang Strengthens Loan Product Lineup Including Jeonse Loans

[Asia Economy Reporter Kim Jin-ho] K-Bank, the first internet-only bank, has succeeded in turning a profit for the first time in over four years since its launch, drawing growing attention as to whether it can maintain this momentum in the second half of the year. Benefiting from the cryptocurrency boom, K-Bank plans to continue its growth by strengthening its loan product lineup in the latter half of the year.

According to the financial sector on the 8th, K-Bank posted a provisional net income of 3.9 billion KRW in the second quarter of this year. This marks the first quarterly profit since its launch in April 2017.

Considering the net loss of 12.3 billion KRW in the first quarter of this year, the cumulative loss for the first half stands at 8.4 billion KRW, which is about one-fifth of the loss scale compared to the first half of 2020 (-44.9 billion KRW).

K-Bank’s successful turnaround to profit in the second quarter was influenced by the partnership effect with the cryptocurrency exchange 'Upbit.' Riding the cryptocurrency boom, the number of new customers and deposits increased significantly. As of the end of July, K-Bank’s customer base reached 6.28 million, having grown by more than 4 million just in the first half of this year.

Deposits and loans increased by 7.54 trillion KRW and 2.1 trillion KRW respectively in the first half, with deposit balances reaching 11.29 trillion KRW and loan balances 5.09 trillion KRW as of the end of June.

However, as the overall cryptocurrency market has recently stagnated, the halo effect that K-Bank had enjoyed can no longer be expected. In fact, since June, the number of newly acquired customers and the growth rate of deposits have noticeably declined.

In response, K-Bank is expected to strengthen its loan product lineup by launching new loan products one after another. Recently, K-Bank introduced a new policy mid-interest loan product called 'Saeitdol Loan.' Additionally, it plans to launch jeonse (long-term deposit lease) loans and jeonse loans targeted at young people within the third quarter. By advancing its credit scoring system (CSS) using telecommunications data from major shareholder KT and payment data from BC Card, K-Bank aims to enhance the competitiveness of its loan products.

An official from the internet bank said, "As the loan product lineup diversifies along with the expansion of new customers, the growth potential will increase further," adding, "With the launch of Toss Bank in the second half, competition is expected to intensify, but the growth of internet banks is expected to continue."