SEOUL, Feb. 6 (Korea Bizwire) – South Korean lenders saw their combined net profit soar 60.4 percent last year from a year earlier as they set aside less reserves against bad loans, the financial watchdog said Friday.
The combined net income of 18 local banks stood at 6.2 trillion won (US$5.7 billion) in 2014, up from 3.9 trillion won the previous year, according to the Financial Supervisory Service (FSS).
The financial watchdog attributed the strong bottom line to decreased loan-loss reserves as lenders set aside 8.9 trillion won last year, down 24.9 percent on-year from 11.9 trillion won.
The net interest margin (NIM), a key gauge of profitability, dropped to a record low of 1.79 percent, the watchdog said.
Their interest income came to 34.9 trillion won last year, unchanged from the previous year, with their non-interest income falling 12.8 percent on-year to 3.6 trillion won, the FSS said.