In the third quarter of this year, savings banks succeeded in returning to the black. They also turned a profit in the first through third quarters, and their soundness indicators are gradually improving.
According to the Korea Federation of Savings Banks on the 13th, cumulative net income for the 79 savings banks nationwide in the third quarter of this year was 422.1 billion won. The 79 companies posted a net loss of 363.6 billion won in the same period a year earlier.
The federation said asset soundness is recovering through proactive disposal of nonperforming loans. Savings banks disposed of 533.0 billion won in distressed real estate project financing (PF) assets through the first and second funds last year. In the first through third quarters of this year, they also wiped out 5.5 trillion won in PF nonperforming loans.
However, the federation said the improvement in interest income is limited due to factors such as an increase in deposits, a decrease in loans, and a decline in interest rates on new loans. As of the third quarter of this year, loans at savings banks nationwide were 93.4 trillion won, down 1.5 trillion won from the previous quarter. Deposits, however, rose 5.5 trillion won from the previous quarter to 105 trillion won. The federation said the scale of deposits increased due to the advance attraction of deposits in preparation for maturities coming up at year-end.
A federation official said, "Before a full-fledged turnaround, we will prioritize building internal capacity through structural improvements such as enhancing soundness, and we plan to make multifaceted efforts to strengthen our sales competitiveness."