SEOUL, May 16 (Korea Bizwire) – The first-quarter earnings of credit card companies in South Korea jumped 59.9 percent from a year earlier due mainly to one-off factors, the country’s financial regulator said Monday.
The combined net profit of eight credit card firms, including Shinhan Card Co. and Lotte Card Co., came to 803.7 billion won (US$718.5 million) in the January-March period, compared to 502.5 billion won the previous year, according to the Financial Supervisory Service (FSS).
The stronger bottom line came as a few of the companies added one-off gains to their balance sheets, the FSS said.
Shinhan Card reversed some 360 billion won from its loan loss reserves in the cited quarter, following regulatory approval to modify its accounting standards. Its net profit reached 401.8 billion won, up 170 percent from a year ago.
“Excluding the reversed loss provision, the actual net income decreases by about 27 billion won from a year ago,” a Shinhan Card official said.
Lotte Card logged 41.2 billion won in net profit, up 71 percent from a year ago, on a one-off gain of 34.5 billion won from selling debts in the first quarter, the company said.
In contrast, KB Kookmin Card Co. saw its net profit decline 12.5 percent on-year to 83.3 billion won, due largely to increased marketing costs. BC Card also recorded 31.9 billion won in net income, down 29.4 percent from the previous year.