Kabang 1Q Operating Profit 88.4 Billion Won... Largest Quarterly Scale Ever

Net Profit Reaches 66.8 Billion Won, Second Highest Quarterly Record
Impact of Increased Interest Income and Growth in Platform and Fee Businesses

[Asia Economy Reporter Minwoo Lee] KakaoBank recorded its highest quarterly operating profit ever in the first quarter of this year. The increase in interest income, along with growth in platform and fee-based business sectors, contributed to enhancing profitability.

On the 3rd, KakaoBank announced its preliminary results for the first quarter of this year, reporting sales of 338.4 billion KRW and operating profit of 88.4 billion KRW. These figures represent increases of 50.5% and 63.8%, respectively, compared to the same period last year. The operating profit is the highest ever recorded in a single quarter. Net profit for the period was 66.8 billion KRW, up 43.2% from the second quarter of last year. This is the second highest amount ever, following 69.3 billion KRW in the second quarter of last year.

Deposit balances totaled 33.0414 trillion KRW, and loan balances reached 25.9651 trillion KRW. These amounts increased by 3.0153 trillion KRW and 103.7 billion KRW, respectively, compared to the end of last year. Although high-credit loans decreased, growth continued due to an increase in loans to medium- and low-credit borrowers and jeonse (key money deposit) loans. Loan balances for medium- and low-credit borrowers in the first quarter rose by 226.9 billion KRW compared to the end of last year, reaching 2.6912 trillion KRW.

By sector, revenues from platform and fee businesses both increased steadily. Platform revenue was 25.3 billion KRW, up 38.5% from the same period last year. The securities account opening service was particularly effective. The number of new partner securities firms increased, and influenced by large initial public offerings (IPOs), 700,000 accounts were opened in the first quarter?the largest quarterly figure ever. Fee revenue was 47.7 billion KRW, an 18.8% increase over the same period. This is attributed to a 14% increase in check card payment volume and a 26% rise in overseas remittance transactions compared to the previous year.

The number of customers is also steadily increasing. As of the first quarter, the customer base reached 18.61 million, an increase of 620,000 from the end of last year. Notably, 70% of new customers in the first quarter were aged 40 and above (28% in their 40s, 27% in their 50s, and 14% aged 60 or older). As a result, the proportion of customers aged 40 and above now accounts for 41% of the total customer base. The number of customers for 'Mini,' a service targeting teenagers, also increased by 130,000 in the first quarter. The monthly active users (MAU) of the mobile application reached 15.03 million, representing about 80% of the total customers.

A KakaoBank official stated, "We plan to expand the regions eligible for mortgage loans in the first half of this year and launch loans for individual business owners and deposit products in the second half. We also intend to actively begin preparations for overseas market entry."