South Korea Financial Supervisory Service reports domestic banks first quarter 2026 net income fell 3.9 percent to KRW6.7 trillion

The South Korea Financial Supervisory Service published preliminary first quarter 2026 results for 20 domestic banks, showing net income of KRW6.7 trillion, down KRW0.3 trillion or 3.9 percent from a year earlier. Interest income increased, but weaker non-interest income and lower profitability ratios weighed on overall earnings. Commercial banks posted a year-on-year increase in net income, led by internet-only and regional banks, while national banks saw a slight decline and specialized banks recorded a larger drop. Interest income rose 6.4 percent to KRW15.8 trillion as net interest margin increased by 0.03 percentage points to 1.56 percent and interest-bearing assets grew 4.8 percent. Non-interest income fell 35.6 percent to KRW1.3 trillion, mainly because securities income declined by KRW3.6 trillion and turned to a loss as higher market interest rates caused valuation losses. Selling, general and administrative expenses increased 5.4 percent to KRW7.2 trillion, while loan loss expenses fell 16.2 percent to KRW1.4 trillion. Return on assets declined from 0.71 percent to 0.64 percent and return on equity fell from 9.57 percent to 8.68 percent. The Financial Supervisory Service said it will guide domestic banks to strengthen loss-absorbing capacity in response to rising uncertainty at home and abroad, and will continue urging banks to fulfill social and public responsibilities while maintaining sound profitability.