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[Alpha Biz=(Chicago) Reporter Kim Jisun] Shinhan Financial Group posted a net profit of KRW 2.62 trillion in the first half of this year. Both interest income and non-interest income grew evenly, but net profit decreased due to conservative provisions and increased sales and management costs. Shinhan Financial Group announced its plan to ease provisions in the second half of this year.
Shinhan Financial Group announced on the 27th that its consolidated net profit for the first half of this year was 2.6262 trillion won. The figure is down 2.1 percent (56.1 billion won) from a year earlier. Net profit for the second quarter was 10.8 percent from the previous quarter (1.388 trillion won) and 1.2383 trillion won, down 4.6 percent from a year earlier.
Shinhan Financial Group's interest income rose 3.3% year-on-year to 5.268 trillion won. Interest income in the second quarter was 2.6942 trillion won, up 4.7% from the previous quarter on the back of △ an increase in interest rate assets △ a rise in bank margins △ a decrease in non-banking procurement costs.
The group's net interest margin (NIM) was 2.00% and the bank's NIM was 1.64%, up 5bp and 6bp from the previous quarter.
Shinhan Financial Group set aside KRW 548.5 billion in group loan-loss reserves in the second quarter following the first quarter (KRW 461 billion), with its accumulated loan-loss reserves reaching KRW 1.95 trillion in the first half. It is an increase of 67.8% compared to the same period last year. Shinhan Financial Group's ratio of provisions to total loans and total assets has continued to rise to 0.96% and 0.55%, respectively.
In addition to setting aside provisions, the accumulated cost of judges in the first half rose 9.0% year-on-year to 2.7988 trillion won due to increased depreciation costs and inflation due to increased digital and ICT investment.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
