As Major Banks Soared, Regional Banks Took Off... Top 3 Regional Financial Institutions Achieve Record Quarterly Performance

Combined Net Profit of Top 3 Financial Groups in Q1 Reaches 605.3 Billion Won

[Asia Economy Reporter Yu Je-hoon] The three major regional financial groups in South Korea continued their strong performance in the first quarter, posting a combined net income of approximately 600 billion KRW. Their net income growth rate of about 35% even surpassed the 16.9% increase recorded by the four major financial holding companies, which posted the highest quarterly net income in history.

According to the financial sector on the 29th, the combined net income of the three major regional financial holding companies (BNK, JB, DGB) in the first quarter was 605.3 billion KRW, representing a 34.9% increase compared to the previous year.

BNK Financial Group's consolidated net income for the first quarter was 276.3 billion KRW, a 43.4% increase year-on-year. By major affiliates, Busan Bank and Gyeongnam Bank posted net incomes of 215.4 billion KRW and 128.2 billion KRW, up 45.1% and 34.7%, respectively. Non-bank affiliates such as capital, investment securities, savings banks, and asset management also saw net income rise by 28.3% to 93.4 billion KRW.

JB Financial Group also recorded a net income of 166.8 billion KRW, up 26.0%, marking the highest quarterly level ever. By affiliate, Jeonbuk Bank posted 54.4 billion KRW, up 26.3%, and Gwangju Bank posted 63.5 billion KRW, up 22.4%. Non-bank affiliates such as JB Woori Capital and asset management also saw significant increases in net income.

DGB Financial Group achieved a net income of 162.2 billion KRW, up 31.3%, breaking its quarterly record. Daegu Bank posted net income of 118.7 billion KRW, up 29.7%, while non-bank affiliates including securities, life insurance, and capital recorded net income of 75.4 billion KRW, up 34.2%, driving the performance growth.

The strong performance growth of the regional financial groups is attributed to the improvement in net interest margin (NIM) following four consecutive base rate hikes since August last year. A regional bank official stated, "As inflation continues, there is a high possibility of two to three additional base rate hikes within the year, so interest income is expected to increase for the time being."

However, regional financial groups plan to focus on risk management as there are considerable domestic and external challenges this year. BNK Financial stated, "Due to the Russia-Ukraine situation and inflation concerns, the financial market is experiencing a triple decline in interest rates, exchange rates, and stock prices. Therefore, we will make every effort not only to improve profitability but also to manage risks arising from increased financial market volatility."

This content was produced with the assistance of AI translation services.