South Korea Financial Supervisory Service (FSS) published preliminary 2025 earnings and key balance sheet and soundness indicators for savings banks and mutual financial cooperatives, based on end-December 2025 data. Savings banks swung to a KRW 417.3 billion net profit as credit costs fell and asset quality indicators improved, while mutual financial cooperatives recorded lower net income and slightly weaker delinquency and capital metrics. For savings banks, aggregate assets fell 2.4% year on year to KRW 118.0 trillion and deposits declined to KRW 99.0 trillion, while shareholders’ equity rose to KRW 15.2 trillion. Net income improved from a KRW 423.2 billion loss in 2024 to a KRW 417.3 billion profit in 2025, with bad debt expenses down KRW 455.1 billion as non-performing loans were resolved. The loan delinquency rate decreased to 6.04% (from 8.52%) and the substandard-or-below loan ratio to 8.43% (from 10.68%), while the NPL coverage ratio eased to 111.3% and the BIS capital ratio rose to 15.85%. For mutual financial cooperatives, aggregate assets increased 4.3% to KRW 790.0 trillion, with loans up to KRW 540.2 trillion and deposits to KRW 675.6 trillion. Net income declined 15.5% year on year to KRW 886.1 billion, reflecting lower net income in the credit business division due to shrinking interest income, partly offset by a narrower deficit in the economy business division. The delinquency rate edged up to 4.62% and the substandard-or-below loan ratio rose to 5.55%, while the NPL coverage ratio fell to 115.6% and the net capital ratio declined to 7.95%; the FSS signalled it will continue to encourage savings banks and mutual financial cooperatives to strengthen loss-absorbing capacity and financial stability by resolving substandard-or-below loans and maintaining sufficient provisions.
South Korea Financial Supervisory Service 2026-03-20
South Korea Financial Supervisory Service releases 2025 results showing savings banks return to KRW 417bn profit while mutual financial cooperatives profit falls to KRW 886bn
The South Korea Financial Supervisory Service released preliminary 2025 financial data for savings banks and mutual financial cooperatives. Savings banks reported a KRW 417.3 billion net profit due to reduced credit costs and improved asset quality, while mutual financial cooperatives saw a 15.5% decline in net income amid weaker delinquency and capital metrics. The FSS emphasized the need for these institutions to enhance loss-absorbing capacity and stability.