Interest Income and Securities-Related Profit ↑, Up 40.6 Billion KRW (+6.1%) Compared to Same Period Last Year
Common Equity Tier 1 Ratio Increased by 0.15% from Previous Quarter to 12.31%, Continuing Improvement
BNK Financial Group (Chairman Bin Dae-in) announced through its earnings disclosure on the 30th that the group's consolidated net income attributable to controlling interests for the third quarter of 2024 (cumulative) reached 705.1 billion KRW, an increase of 40.6 billion KRW (+6.1%) compared to the same period last year.
Despite an increase in loan loss provisions due to the rise in non-performing assets such as real estate project financing (PF), net income increased year-on-year thanks to growth in interest income and non-interest income, including gains related to securities.
The banking sector recorded a net income of 675.5 billion KRW, up 43.2 billion KRW compared to the same period last year (Busan Bank -8.3 billion KRW, Gyeongnam Bank +51.5 billion KRW).
The non-banking sector showed a net income of 124.1 billion KRW, down 9.9 billion KRW year-on-year due to increased provisions for non-performing assets despite higher gains related to securities. Investment securities (-12.2 billion KRW) saw a decrease in net income compared to the same period last year, while capital (+1.6 billion KRW), savings banks (+1.7 billion KRW), and asset management (+0.9 billion KRW) all recorded increases in net income year-on-year.
The group’s asset soundness indicator, the ratio of non-performing loans (NPL) classified as substandard or below, stood at 1.18%, down 4 basis points from the previous quarter, while the delinquency ratio rose 4 basis points to 0.98%. This reflects the impact of changes in real estate PF project viability assessment criteria and increased defaults due to economic slowdown, indicating a need for more proactive asset quality management going forward.
Additionally, the group’s capital adequacy indicator, the common equity tier 1 (CET1) ratio, improved to 12.31%, up 15 basis points from the previous quarter, due to adequate earnings realization and active risk-weighted assets (RWA) management. Continuous improvement in the CET1 ratio lays the foundation for preparing against credit risk expansion and enhancing shareholder returns in the future.
Regarding the corporate value enhancement plan announced alongside the third-quarter earnings, BNK Financial Group CFO Vice President Kwon Jae-jung stated, “We have set a core profitability target of 10% ROE and will do our best to enhance capital efficiency through stable RWA growth and strengthen the group’s fundamentals.” He added, “We aim to set a medium-term CET1 ratio target of 12.5% and maximize the proportion of share buybacks and cancellations within the scope of steadily increasing dividends per share, striving to achieve a shareholder return ratio of over 50% by 2027.”
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