Internet-only bank KakaoBank recorded its highest-ever performance in the third quarter of this year, driven by balanced growth in customer numbers and traffic. Although net interest margin shrank due to a decline in market interest rates, interest income increased by about 20% year-on-year as household loan volume, centered on mortgage loans, expanded. In addition, non-interest income also grew significantly thanks to the growth of the platform business, boosting overall performance.
KakaoBank announced on the 6th that its net profit for the third quarter reached 124.2 billion KRW. This is the highest quarterly figure ever, marking a 30.1% increase compared to the same period last year. The cumulative net profit for the first three quarters also reached a record high of 355.6 billion KRW, up 27.3% year-on-year. Of KakaoBank’s cumulative operating revenue for the first three quarters (2.1983 trillion KRW), interest income was 1.7921 trillion KRW, a 20.9% increase from 1.482 trillion KRW in the same period last year. This was due to the expansion of household loans, especially mortgage loans, despite the contraction of net interest margin (NIM) caused by falling market interest rates.
As of the end of the third quarter, KakaoBank’s NIM stood at 2.15%, down 0.02 percentage points from the previous quarter (2.17%) and 0.16 percentage points from the same period last year (2.31%).
Among loans, household loans as of the end of the third quarter amounted to 41.224 trillion KRW, an increase of 4.945 trillion KRW (13.63%) compared to 36.279 trillion KRW in the same period last year. Compared to the previous quarter (41.144 trillion KRW), it increased by only 80 billion KRW. The growth in household loans has been gradually slowing, recording 2.467 trillion KRW in the first quarter, 953 billion KRW in the second quarter, and 80 billion KRW in the third quarter.
The increase in household loans was driven by mortgage loans. KakaoBank’s mortgage loan balance (excluding jeonse loans) surged by 4.581 trillion KRW (57.6%) from 7.958 trillion KRW to 12.539 trillion KRW during the same period.
KakaoBank is also leading inclusive finance efforts by supplying loans to medium- and low-credit borrowers and supporting small business financing. It achieved its target of maintaining an average loan balance increase of over 30% for medium- and low-credit borrowers again this quarter. Following last year, when it was the only internet-only bank to meet the medium- and low-credit loan target, KakaoBank accounted for more than half of all personal medium- and low-credit loans supplied by the three internet-only banks in the third quarter.
There was little change in asset quality indicators. KakaoBank’s delinquency rate at the end of the third quarter was 0.48%, unchanged from the previous quarter (0.48%) and improved from 0.49% in the third quarter of last year.
KakaoBank also emphasized that it is diversifying profitability through growth in platform businesses such as loans and investments. Its cumulative non-interest income for the first three quarters was 406.2 billion KRW, a 16.6% increase from 348.4 billion KRW in the same period last year. Among this, fee and platform income amounted to 220.8 billion KRW, up 9.2% year-on-year. KakaoBank explained that platform income increased by more than 19% in one year due to growth in loan comparison and investment services.
KakaoBank’s customer base continues to expand steadily. As of the end of September, KakaoBank had 24.43 million customers, an increase of 2.15 million from two years ago when it surpassed 20 million. Monthly active users (MAU) also reached a record high of 18.74 million.
As of the end of the third quarter, deposit balances stood at 54.3 trillion KRW, and loan balances at 42.9 trillion KRW.
A KakaoBank official said, "The expansion of deposits driven by increased customer activity (traffic) forms a stable foundation for growth. Based on this sustainable growth, we will further expand inclusive finance and continue to serve as the financial life essential app that customers choose first."
KakaoBank is expected to announce its 'Corporate Value Enhancement Plan' as early as the end of this month.
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