K Bank's Q3 net profit jumps 119% year on year to 42.1 billion won, driven by loans to business owners

[Financial News] K Bank more than doubled its net profit in the third quarter of this year from the same period a year earlier, driven by growth in loans to individual business owners. As it expanded corporate finance amid efforts to manage household lending, its loan balance topped 20 trillion won for the first time.
On the 30th, K Bank disclosed that its net profit for the third quarter of this year rose 119% year on year to 42.1 billion won. Cumulative net profit through the third quarter was 102.1 billion won. For the third consecutive year, K Bank posted cumulative net profit in the 100-billion-won range through Q3, demonstrating a stable earnings base.
Loans to individual business owners led the earnings growth. The loan balance at the end of the third quarter stood at 20.58 trillion won. The corporate loan balance grew 89% year on year, and its share of total lending also rose to 17.7%. More than half of this year's increase in lending came from corporate loans.
K Bank accounted for 33.1% of the net increase in loans to individual business owners across South Korea's banking sector through the third quarter of this year. Since launching guaranteed loans in 2022, it has supplied more than 5 trillion won in cumulative loans to individual business owners, including 2.1 trillion won so far this year. While expanding lending mainly through real estate-backed and guaranteed loans, it recorded a delinquency rate of 0.55% on loans to individual business owners.
As lending expanded, interest income from loans rose about 16.7% year on year to 130.1 billion won. Cumulative net interest margin (NIM) was 1.60%, up 0.22 percentage points from the same period a year earlier. Non-interest income climbed 28.3% to 26.9 billion won, boosted by gains from sales of loan receivables and increased securities-related income.
At the end of the third quarter, the number of customers stood at 16.88 million, up about 1.91 million from a year earlier. The deposit balance was 29.39 trillion won, down about 3% year on year but up about 10% from the previous quarter. K Bank said, “Even as funds shifted to the stock market and deposits of virtual assets declined, sales of time deposits and installment savings accounts supported our deposit base.”
Asset-quality indicators deteriorated slightly from the previous quarter. The overall delinquency rate rose from 0.60% to 0.62%, while the ratio of substandard-or-below loans increased from 0.59% to 0.60%. The cost of credit ratio for the third quarter was 1.12%, up 0.4 percentage points from the previous quarter. At the end of the third quarter, the capital adequacy ratio under the Bank for International Settlements (BIS) standard stood at 19.59%.
K Bank plans to expand its financing for individual business owners and partnerships with external platforms. This month, it broadened the collateral eligible for its “Business Owner Real Estate-Backed Loan” from apartments to other multi-unit housing and commercial real estate, and expanded the permitted use of funds from working capital to facility funds.
By year-end, K Bank plans to launch the “NAVER Pay Business Owner Loan” and the “MUSINSA Money K Bank account and debit card.” After extending its real-name-verified deposit and withdrawal account partnership with Upbit by one year this month, it is also preparing services for corporate customers in line with the timetable for establishing a framework for corporate digital-asset trading.
A K Bank spokesperson said, “Despite the highly volatile external environment, we achieved 119% year-on-year earnings growth, supported by the steady rise in loans to individual business owners,” adding, “We will broaden our customer base and secure new growth drivers by expanding in the corporate finance market and working with external platforms.”
[email protected] Lee Hyun-jung Reporter