Net Profit Down but Core Business Improves... BNK Financial Group’s First-Half Net Profit Falls 13.5%

"Yeouido Fund Settlement Loss Reflected"

Non-Banking Affiliates Show Improved Performance

Quarterly Cash Dividend of KRW 150 Per Share

BNK Financial Group's performance in the first half of the year declined compared to last year, primarily due to one-off accounting factors related to real estate funds. However, while net profit decreased, the fundamental business showed improvement.

BNK Financial Group (Chairman Byun Daein) announced on the 28th that its consolidated net profit for the first half of this year was KRW 411.8 billion, a 13.5% (KRW 64 billion) decrease from the same period last year.

The decline in net profit was influenced not by a downturn in its core business, but by one-off accounting factors related to real estate funds that occurred both last year and this year. In the first half of last year, a fund liquidation gain of KRW 54.4 billion from the sale of the Gangnam BNK Digital Tower was reflected in the results, while this year, a settlement loss of KRW 44 billion occurred in the process of acquiring an external stake in the Yeouido BNK Financial Tower real estate fund.

Excluding these one-off factors, BNK Financial Group explained that its core business profitability improved. Adjusted operating profit increased and the burden of provisions decreased, resulting in a normalized first-half net profit of KRW 455.8 billion, up KRW 34.4 billion (8.2%) year-on-year.

By affiliate, the banking segment's performance decreased. Net profit from Busan Bank and Kyongnam Bank declined by KRW 50.5 billion and KRW 3.5 billion, respectively, leading to a banking segment net profit of KRW 356.2 billion—down KRW 54 billion from the previous year.

In contrast, non-banking affiliates delivered improved results. As the performances of BNK Capital, BNK Securities, BNK Savings Bank, BNK Asset Management, and BNK Venture Investment increased, the net profit for the non-banking segment was KRW 172.6 billion, up KRW 63.8 billion from the previous year.

Asset quality continued to improve. The ratio of non-performing loans stood at 1.46%, and the delinquency rate at 1.34%—respectively down 0.11 percentage points and 0.08 percentage points from the previous quarter. However, BNK Financial Group stated that there is still room for improvement compared to the industry average, and that it will continue efforts to strengthen risk management and asset soundness.

The common equity Tier 1 (CET1) ratio was 12.14%, down 0.16 percentage points from the previous quarter due to an increase in high-quality assets and shareholder return policies.

The board of directors resolved a quarterly cash dividend of KRW 150 per share on this day. The approximately 3.49 million shares (worth about KRW 60 billion) of treasury stock acquired in the first half of this year will all be retired during the third quarter.

Park Sunwook, Chief Financial Officer (CFO) and Vice President of BNK Financial Group, stated, "The decline in net profit was due to a base effect from last year's gain on the sale of the Gangnam BNK Digital Tower. Excluding one-off factors, operating profitability has been steadily improving, so we plan to further expand our stable earnings base and focus on capital and soundness management going forward."

BNK Financial Group.

This content was produced with the assistance of AI translation services.