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Photo courtesy of Yonhap News |
[Alpha Biz= Paul Lee] South Korea’s four major commercial banks delivered mixed earnings performances last year, with KB Kookmin Bank reclaiming the industry’s top position for the first time in four years, while Woori Bank posted the only decline in net profit.
According to the financial sector, KB Kookmin Bank recorded net profit of KRW 3.86 trillion in 2024, up 18.8% year-on-year, supported by growth in average loan balances, lower funding costs, and improved fee income from bancassurance, funds and trust products. The result allowed KB to overtake Shinhan Bank as the country’s leading bank by annual net profit.
Shinhan Bank posted net profit of KRW 3.77 trillion, up 2.1% from a year earlier. Gains in fee income and securities-related earnings boosted operating profit, though higher costs limited overall growth. Shinhan had led the sector in 2024 and through the first half of last year but slipped to second place on a full-year basis.
Hana Bank reported net profit of KRW 3.75 trillion, up 11.7% year-on-year, driven by stronger non-interest income and synergies in foreign exchange and wealth management. Its net interest margin (NIM) improved to 1.52% from 1.46%, reflecting effective cost management despite a lower-rate environment.
By contrast, Woori Bank’s net profit fell 14.2% to KRW 2.61 trillion. While core operating performance remained stable, higher provisions to buffer domestic and external uncertainties weighed on earnings, making it the only major bank to post negative growth.
NIM trends also diverged. KB and Shinhan saw slight declines in margins as falling market rates and slower deposit repricing pressured profitability, while Hana and Woori posted modest NIM improvements through a higher share of low-cost deposits and asset rebalancing.
Looking ahead, analysts warn that earnings growth may face headwinds this year due to tighter household lending regulations, slower loan growth, funding cost volatility and currency weakness, even as margins show resilience in the near term.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
