The Financial Supervisory Service said on the 9th that 10 domestic financial holding companies posted a net profit of 26.7 trillion won last year. That was up 12.4 trillion won (12.4%) from a year earlier.
Among affiliates of financial holding companies, banks' net profit rose 10.1% (1.6 trillion won) from a year earlier. During the same period, net profit in the financial investment sector jumped 62.3% (2 trillion won). In contrast, insurance fell 6.1% (236.1 billion won), and specialized credit finance and others decreased 0.7% (18 billion won), respectively.
By sector, banks accounted for 57.4% of the total net profit of financial holding companies. They were followed by financial investment at 17.0%, insurance at 11.7%, and specialized credit finance at 8.1%.
At the end of last year, the total assets of financial holding companies (on a consolidation basis) were 4,067 trillion won, up 312 trillion won (8.3%) from the end of the previous year (3,754 trillion won). Banks accounted for 72.6% of total assets at financial holding companies.
As of the end of last year, the Basel Committee on Banking Supervision (BIS) total capital ratio, tier 1 capital ratio, and common equity tier 1 ratio of eight bank holding companies—KB, Shinhan, Hana, Woori, NH, iM, BNK and JB—were 15.75%, 14.81% and 13.15%, respectively, all up from the end of the previous year.
For nonbank holding companies such as Korea Investment & Securities Co. and Meritz, the ratio of capital to required capital was 161.66%, down 6.29 percentage points from the end of the previous year (167.95%). The regulatory minimum capital ratio for nonbank holding companies is 100% or higher.
The ratio of substandard or below loans at financial holding companies was 0.95%, up 0.05 percentage points from the end of the previous year (0.90%). The ratio of substandard or below loans refers to the share of nonperforming loans (NPLs) in arrears for three months or longer. Last year, 20 companies were newly added to financial holding companies, and 12 companies were wound up.
A Financial Supervisory Service (FSS) official said, "With Middle East risks and the prolonged period of a strong dollar and high oil prices, internal and external uncertainties continue, making thorough preparation for potential deterioration in asset quality necessary," and added, "We will guide subsidiaries to strengthen asset quality management and secure a sufficient level of loss-absorbing capacity in preparation for a worsening economic environment at home and abroad."