Meritz Securities Reports Q3 Net Profit of 162.5 Billion KRW... 11 Consecutive Quarters Above 100 Billion KRW

[Asia Economy Reporter Park Jihwan] Meritz Securities posted strong earnings in the third quarter of this year. This is evaluated as a result of building a stable profit portfolio despite the spread of the novel coronavirus infection (COVID-19) and the uncertain financial market environment.

According to Meritz Securities on the 5th, the consolidated net profit for the third quarter of this year was 162.5 billion KRW, an increase of 55.6% compared to the same period last year. Since the first quarter of 2018, it has recorded net profits in the 100 billion KRW range for 11 consecutive quarters until the third quarter of 2020. Operating profit and pre-tax profit recorded 208.1 billion KRW and 223.9 billion KRW, respectively, increasing by 72.2% and 57.3% compared to the same period last year.

As the domestic stock market showed favorable performance, brokerage commission income expanded due to increased trading volume, resulting in the retail division achieving its highest quarterly performance. In the trading division, strategic trading and arbitrage also recorded favorable results. The corporate finance (IB) and wholesale (corporate sales) divisions also contributed to maintaining strong performance with balanced results.

Return on equity (ROE) recorded 13.0%, rising 0.7 percentage points from 12.3% in the previous quarter, maintaining a top-tier position in the industry. The net capital ratio (NCR) and leverage ratio, indicators of financial soundness, stood at 1562% and 712%, respectively, as of the end of September 2020, improving by 173 and 19 percentage points compared to the end of the previous quarter. The net capital ratio (old NCR), mainly used by credit rating agencies to assess capital adequacy, also increased by 16 percentage points to 204% compared to the end of the second quarter.

A Meritz Securities official explained, "Despite the normalization of the COVID-19 situation being delayed beyond expectations, all business divisions recorded satisfactory results."

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