BNK Financial Group (BNK) posts 622.3 billion won in cumulative net profit through Q3, down 19% year on year

[Financial News] BNK’s cumulative net profit for the first three quarters of this year fell nearly 20% from a year earlier. The decline was affected by the base effect of one-off gains from property sales last year and lower non-interest income. Despite weaker earnings, BNK is continuing its shareholder-return policy, having decided to pay a quarterly dividend of 150 won per share and buy back and cancel treasury shares worth 60 billion won. 
On the 26th, BNK disclosed that its consolidated net profit for the first three quarters of this year was 622.3 billion won, down 19.2% from the same period a year earlier. 
BNK explained, “Operating profit increased, but net profit declined due to the one-off gain of 100.9 billion won from the sale of the BNK Gangnam Core office last year and a decrease in non-interest income, among other factors.” 
The banking division’s weak performance stood out. The cumulative net profit of Busan Bank and Gyeongnam Bank for the first three quarters was 557.3 billion won, down 113.1 billion won from the same period a year earlier. Net profit fell by 99.1 billion won at Busan Bank and 14 billion won at Gyeongnam Bank. 
The non-bank division posted cumulative net profit of 213.7 billion won, an increase of 47.7 billion won over the same period. The increases in net profit at each affiliate were 20.8 billion won at BNK Securities, 13.7 billion won at BNK Asset Management, 7.8 billion won at BNK Capital, 4.4 billion won at BNK Savings Bank and 800 million won at BNK Venture Investment.
Asset-quality indicators were mixed. The non-performing loan ratio fell 0.01 percentage points from the previous quarter to 1.45%, while the delinquency rate rose 0.06 percentage points to 1.40%.
The common equity Tier 1 (CET1) ratio, a capital adequacy indicator, came in at 12.18%, up 0.04 percentage points from the previous quarter. The figure reflected factors including the management of risk-weighted assets and an increase in retained earnings.
Despite weak earnings, BNK is continuing its shareholder-return policy. On the day, BNK’s board resolved to pay a quarterly cash dividend of 150 won per share and to buy back and cancel treasury shares worth 60 billion won in the second half of the year.
Park Seong-wook, BNK’s vice president and CFO, said on the earnings conference call that “net profit fell from the same period a year earlier due to the effect of one-off gains recorded last year and a decline in non-interest income, among other factors.” He added, “We will press ahead without disruption with the profitability improvement initiatives under Value-up 2.0, announced last September, and do our utmost to repay the market’s trust by boosting operational efficiency and productivity.”
BNK has previously set targets under “Value-up 2.0” of a return on equity (ROE) of 10.5%, a CET1 ratio of 12.5% and a shareholder return ratio of at least 50%. It also plans to proactively review financial products and services for factors that cause consumer inconvenience or detriment, and to embed financial consumer protection in the group’s standards and organizational culture. 


[email protected] Lee Hyun-jung Reporter