SEOUL, May 6 (Korea Bizwire) — South Korea’s top internet-only lender Kakao Bank said Wednesday its first-quarter net profit nearly tripled due mainly to increased interest income.
Net profit came to 18.5 billion won (US$15.2 million) in the January-March period, up about 181 percent from a year earlier, the lender said in a regulatory filing.
The first-quarter tally is much higher than the bank’s full-year bottom line of 13.7 billion won in 2019.
Kakao Bank, controlled by Kakao Corp., operator of South Korea’s dominant messaging app KakaoTalk, attributed the stellar performance to higher interest income.
The online lender’s interest income surged 54.9 percent from a year ago to 84.4 billion won during the three-month period on the back of loan assets.
Also responsible was a fall in fee losses to 3.1 billion won from 14.9 billion won a year earlier, it added.
Kakao Bank expected its fee-related business to take a turn for the better down the road as it began issuing credit cards in late April.
As of end-March, the lender’s assets totaled 23.4 trillion won, with its lending reaching 16.4 trillion won.
Its net interest margin, or the difference between interest paid and interest received, came to 1.54 percent with the loan delinquency rate reaching 0.20 percent, unchanged from end-2019.
In 2017, Seoul allowed two internet-only banks — Kakao Bank and K-Bank — to offer their services around the clock without face-to-face contact with customers and without brick-and-mortar branches.
In late December, South Korea granted preliminary approval for a new internet-only bank to fuel competition with established bigger players and foster the fledging market.