NongHyup Financial, 2023 Net Profit of 2.2343 Trillion KRW... 0.2% Increase from Previous Year

NH Nonghyup Financial Group announced on the 16th that its net profit for 2023 was 2.2343 trillion KRW, an increase of 0.2% (3.4 billion KRW) compared to the previous year. Considering the agricultural support expenses (492.7 billion KRW) spent annually to support agriculture and rural areas,

the net profit was 2.5774 trillion KRW.

The group’s consolidated profit and loss was at a similar level to 2022, but Nonghyup Financial explained that it strengthened a more stable profit and loss structure through an increase in non-interest income and enhanced loss absorption capacity.

Interest income was 8.5441 trillion KRW, down 10.6% (1.0118 trillion KRW) from the same period last year. However, excluding the decrease in interest income due to changes in insurance accounting standards, the actual interest income increased by 7.8% (748.1 billion KRW) compared to the previous year.

Non-interest income increased by 156.3% (1.0282 trillion KRW) to 1.6859 trillion KRW. Gains from securities operations rose by 245.6% (1.0289 trillion KRW) to 1.4478 trillion KRW.

In particular, due to the conservative application of provisioning standards for stable future loss absorption capacity and additional provisioning related to real estate project financing (PF), the credit loss provision increased by 1.3198 trillion KRW to 2.1018 trillion KRW. The resulting loan loss provision coverage ratio was 202.12%.

The asset soundness indicator, the ratio of non-performing loans (NPL) to total loans, recorded 0.57%, and profitability indicators were return on equity (ROE) before agricultural support expenses at 9.02% and return on assets (ROA) at 0.55%.

Looking at the performance by subsidiaries, Nonghyup Bank posted a net profit of 1.7805 trillion KRW, followed by NH Investment & Securities (556.4 billion KRW), Nonghyup Life Insurance (181.7 billion KRW), Nonghyup Property & Casualty Insurance (145.3 billion KRW), and Nonghyup Capital (85.5 billion KRW).

Social contributions to support agriculture and rural areas were also expanded. Agricultural support expenses reached 492.7 billion KRW, an increase of 9.4% (42.2 billion KRW) compared to the same period last year. Additionally, 173.5 billion KRW was spent on social contributions to support vulnerable groups and marginalized local communities. Furthermore, 214.8 billion KRW was provided for livelihood finance, including cashback on small business loan interest.

An official from Nonghyup Financial stated, "In preparation for uncertain management conditions in 2024, we will establish a stable management foundation by strengthening meticulous and proactive risk management, internal control, and consumer protection. At the same time, we will do our best to fulfill Nonghyup Financial’s core role of supporting agriculture and rural areas and the social responsibilities of a financial company." He added, "We plan to focus on securing sustainable growth competitiveness by integrating artificial intelligence (AI), digital technology, and ESG throughout our business to provide customers with new experiences and secure a mid- to long-term profit base."