SBI Savings Bank Net Profit Drops 96% in Q1 This Year

Net Income of 3.7 Billion KRW, Down 86.4 Billion KRW from Last Year
Impact of Increased Interest Expenses and Additional Provisions
Non-Performing Loan Ratio Overdue by More Than 90 Days Rises by 1.33%p

SBI Savings Bank's net profit for the first quarter of this year was recorded at 3.7 billion KRW, a 96% decrease compared to the same period last year. This was due to increased interest expenses from rising deposit interest rates and additional provisions for loan losses. Asset quality indicators such as the non-performing loan ratio also deteriorated slightly.

SBI Savings Bank announced on the 31st that its net profit for the first quarter of this year was 3.7 billion KRW. This represents a 95.9% (86.4 billion KRW) decrease compared to 90.1 billion KRW in the first quarter of last year.

The decline in performance was mainly due to a significant increase in interest expenses following the rise in deposit interest rates at the end of last year. SBI Savings Bank's interest expenses for the first quarter of this year were 15.34 billion KRW, more than double the 6.34 billion KRW recorded in the same period last year.

Asset quality indicators also showed some deterioration. The bank's non-performing loan ratio for the first quarter of this year was 3.78%, up 1.33 percentage points from 2.45% in the same period last year. The non-performing loan ratio represents the proportion of loans overdue by more than three months in total loans; a higher ratio indicates poorer loan quality. The delinquency rate on small credit loans also rose by 1.35 percentage points, from 2.69% in the first quarter of last year to 4.04% this year.

The BIS (Bank for International Settlements) capital adequacy ratio decreased by 0.98 percentage points during the same period, from 14.36% to 13.39%, and the liquidity ratio fell by 11.37 percentage points, from 131.04% to 119.67%. The liquidity ratio indicates a financial institution's ability to meet short-term obligations; a lower ratio means reduced payment capacity.

An SBI Savings Bank official explained, “Interest expenses increased significantly, and from a risk management perspective, we set aside about 1.3 times the regulatory recommended loan loss provisions, which led to lower profits than usual. However, asset quality remains good, ranking among the top in the industry.”

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