While specialized credit finance companies continue to see solid growth in their asset size, they are also making thorough efforts to manage asset quality.
Korea Capital announced on May 15 that it recorded an operating profit of 29 billion won and a net profit of 22.07 billion won in the first quarter of this year. Compared to the same period last year, operating profit increased by 2.5%, while net profit decreased by 2%.
Although net profit slightly declined year-on-year, last year’s fourth quarter, which marked the company’s highest-ever performance, saw an operating profit of 26.7 billion won and a net profit of 20.5 billion won. Compared to the previous quarter, this represents an increase of 8.7% and 7.6%, respectively.
A Korea Capital representative explained, “Expenses increased somewhat as we set aside additional provisions for bad debts to improve asset quality in our corporate and retail finance divisions. In order to achieve net profit growth, strict management of credit loss expenses is essential, so we have significantly strengthened our screening criteria, such as CSS standards, and are focusing on intensive management of early delinquencies to secure asset soundness.”
Korea Capital has continued steady external growth through a diversified business portfolio that includes corporate, retail, auto, lease, and investment sectors. As of the end of the first quarter, its total assets reached 4.5 trillion won. The leverage ratio, a key financial soundness indicator, remained low at 6.6 times.
A Korea Capital representative stated, “We are closely monitoring market volatility and economic conditions, placing emphasis on securing profitability while minimizing risk. Through these efforts, we aim to achieve another record-breaking performance this year by maintaining robust internal growth.”
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