NH NongHyup Financial Group said on the 31st that cumulative net profit for the third quarter this year was 2.2599 trillion won, down 1.8% from a year earlier. Interest income fell 3.2% to 6.1863 trillion won, a major drag. NongHyup Financial said interest income decreased as the net interest margin (NIM) at the bank and card units was 1.67% in the third quarter, down 0.24 percentage points from a year earlier.
Non-interest income, by contrast, rose 20.6% to 1.8766 trillion won. Securities and foreign exchange derivatives gains reached 274.1 billion won, up 24.4%, and fees increased 12.5% to 167.9 billion won.
As of the end of the third quarter, the ratio of substandard-or-below loans was 0.58%, down 0.1 percentage points from the end of last year. The loan-loss allowance coverage ratio also rose over the same period to 186.4% from 177.9%, and credit loss provisions booked fell 27.6% to 493.1 billion won.
Return on assets (ROA), a profitability indicator, was 0.6%, and return on equity (ROE) was 9.48%. That is slightly lower than the record levels of the third quarter of last year. During the third quarter, NongHyup Financial affiliates' expenditure on agricultural support projects was 487.7 billion won, up 6.4% from the same period a year earlier (458.3 billion won).
By affiliate, NH NongHyup Bank's cumulative net profit for the third quarter this year was 1.5796 trillion won, down 4.6% from a year earlier. In particular, NH NongHyup Life over the same period recorded 210.9 billion won, down 14.9%. NH NongHyup Non-life Insurance was also tallied at 121.9 billion won, down 12.1%. However, NH Investment & Securities rose 29.7% to 748.1 billion won, driving NongHyup Financial's non-interest income growth.