The South Korea Financial Supervisory Service published preliminary third-quarter earnings data showing domestic banks generated KRW21.1 trillion of net income in the nine months to September 2025, up KRW2.3 trillion year on year. Profitability metrics rose slightly, with return on assets at 0.67% and return on equity at 8.99%. Net income increased at commercial banks, including national and internet-only banks, while regional banks’ net income fell slightly and specialised banks’ earnings rose. Interest income edged up 0.7% to KRW44.8 trillion as a 4.5% expansion in interest-bearing assets more than offset a 0.07 percentage point decline in net interest margin to 1.51%. Non-interest income increased 18.5% to KRW6.8 trillion, driven by a KRW2.6 trillion rise in FX-derivatives income linked to falling exchange rates, while loan loss expenses rose to KRW4.7 trillion alongside a continuing increase in delinquency rates on won-denominated loans. The Financial Supervisory Service indicated it will continue encouraging banks to strengthen loss-absorbing capacity to prepare for potential credit risk, and noted that third-quarter 2025 figures are preliminary and subject to change.
South Korea Financial Supervisory Service 2025-11-20
South Korea Financial Supervisory Service reports domestic banks’ nine-month net income rose 12% to KRW21.1 trillion in 2025
The South Korea Financial Supervisory Service reported preliminary third-quarter 2025 earnings data, showing domestic banks' net income rose to KRW21.1 trillion, a KRW2.3 trillion increase year-on-year. Interest income grew by 0.7% to KRW44.8 trillion, while non-interest income surged 18.5% to KRW6.8 trillion, driven by FX-derivatives income. The authority emphasized the need for banks to enhance loss-absorbing capacity amid rising loan loss expenses and delinquency rates.