NH Nonghyup Financial Group achieved a record half-year net income of 1.78 trillion won, surpassing 1.7 trillion won for the first time this year.
Growth in interest income and an increase in non-interest income due to a strong stock market drove the results, with NH Investment & Securities leading the way with more than double its profit growth.
According to Yonhap News and NH Nonghyup Financial, the group's net income for the first half of the year was 1.7791 trillion won, a 9.2% increase compared to the same period last year. However, net income for the second quarter was 910.4 billion won, a slight decrease from the previous year.
The improvement in performance was attributed to simultaneous growth in both interest and non-interest income. Interest income for the first half reached 4.4422 trillion won, an 8.4% increase from the previous year. This growth was influenced by an expansion in core deposits, the growth of high-quality assets centered on corporate finance, and an improvement in the net interest margin (NIM) in the banking and card sectors, which rose from 1.67% at the end of last year to 1.74% by the end of June this year.
The strong stock market also supported the results. Non-interest income for the first half was 1.9599 trillion won, a 47.4% increase from last year, with commission income rising 71.2% to 1.6814 trillion won, driven by increased demand for stock trading and asset management.
By subsidiary, NH Investment & Securities showed remarkable growth, reporting a net income of 965.2 billion won, a 107.5% increase from the previous year. In contrast, NH Nonghyup Bank saw its net income decrease by 2.1% to 1.1629 trillion won due to rising corporate tax rates and increased education taxes. The insurance subsidiaries also struggled, with NH Nonghyup Life Insurance reporting a net income of 35.1 billion won, down 77.3%, and NH Nonghyup Property & Casualty Insurance reporting 71.7 billion won, down 18.1%.
Overall, the group's soundness indicators remained stable. The non-performing loan (NPL) ratio was 0.65%, a slight increase from last year, while the common equity tier 1 capital ratio improved by 0.59 percentage points to 12.97%.
NH Nonghyup Financial plans to invest a total of 1 trillion won into its key subsidiaries, including 500 billion won for the bank, 400 billion won for securities, and 100 billion won for capital, based on a 1.2 trillion won capital increase from the National Agricultural Cooperative Federation this year. The company aims to enhance its business competitiveness and strengthen its foundation for future growth.
An NH Nonghyup Financial official stated, "Despite the capital dilution effect from the capital increase, we achieved the largest half-year performance in history. We expect the effects of the capital increase to become more pronounced in the second half, accelerating profitability improvements."
* This article has been translated by AI.
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