South Korea’s Financial Supervisory Service published preliminary first-half 2025 earnings and key balance sheet, asset quality and capital indicators for savings banks and mutual financial cooperatives. The data show savings banks returned to profit alongside improving delinquency and substandard-or-below loan ratios, while mutual financial cooperatives expanded assets and lending but recorded sharply lower net income and weaker credit metrics. For savings banks, aggregate assets fell to KRW118.8 trillion at end-June 2025 from KRW120.9 trillion at end-December 2024, with loans down KRW3.0 trillion and deposits down KRW2.7 trillion, while shareholders’ equity rose to KRW14.9 trillion. Net income improved to KRW257.0 billion from a loss of KRW395.8 billion a year earlier, driven in part by lower bad debt expenses, and the loan delinquency rate declined to 7.53% with the substandard-or-below loan ratio down to 9.49%; the NPL coverage ratio was 112.0% against a 100% minimum and the BIS capital ratio increased to 15.60%. Mutual financial cooperatives’ assets rose to KRW775.3 trillion, with loans increasing to KRW535.0 trillion and deposits to KRW666.4 trillion, but net income fell 60.8% year on year to KRW417.6 billion as credit business net income decreased amid shrinking interest income and higher bad debt expenses; the overall delinquency rate increased to 5.70% and the substandard-or-below loan ratio to 6.27%, while the NPL coverage ratio fell to 111.6% and the net capital ratio declined to 7.91%. The Financial Supervisory Service indicated 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 provisioning.

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