In the first quarter of this year, domestic banks recorded a net profit of 6.9 trillion won. This represents a 28.7% increase compared to the same period last year.
According to the 'First Quarter 2025 Domestic Bank Operating Performance (Provisional)' announced by the Financial Supervisory Service on the 23rd, the net profit of domestic banks was 6.9 trillion won by the end of March this year, marking an increase of 28.7% (1.5 trillion won) compared to the first quarter of last year (5.53 trillion won). In the first quarter of last year, net profit fell to the 5 trillion won range due to compensation effects from large losses in the Hong Kong H Index-linked securities (ELS). Net profit in the first quarter of 2023 was 7 trillion won.
By institutional sector, interest revenue was 14.8 trillion won, a decrease of 0.8% (100 billion won) compared to the same period last year, while non-interest revenue was 2 trillion won, an increase of 6.6% (100 billion won) during the same period. The FSS explained that the decrease in interest revenue was due to declining market interest rates, while gains from securities valuations increased.
The return on assets (ROA) for domestic banks in the first quarter was 0.71%, up 0.13 percentage points from the same period last year (0.57%). The return on equity (ROE) also recorded an increase of 1.75 percentage points to 9.55% during the same period.
The loan loss expense was 1.6 trillion won, an increase of 23.9% (300 billion won) compared to the same period last year (1.3 trillion won). This increase is a result of raising provisions in response to concerns about the corporate restructuring of Homeplus and the expansion of credit losses.
An FSS official noted, "Despite the decrease in interest revenue and the increase in loan loss expenses, the base effect from the one-time ELS compensation (1.8 trillion won) in the first quarter contributed to the increase in net profit," adding that they plan to continuously encourage banks to enhance their capacity to absorb losses so that they can faithfully perform their original function as financial intermediaries.