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Savings banks' 2016 net surges 34.6%

South Korea's savings banks posted a sharp increase in their combined net profit last year on increased interest income, data showed Thursday.

The total net income of 79 savings banks here jumped 34.6 percent on-year to 862.2 billion won ($753.7 million) according to the Financial Supervisory Service. It said the figure is a provisional one.

A file photo of the logo of a South Korean savings bank (Yonhap)
A file photo of the logo of a South Korean savings bank (Yonhap)

Their interest revenue rose by 632.1 billion won compared with a 258 billion won rise in loan-loss reserves.

Their aggregate assets came to 52.4 trillion won, up 8.5 trillion won or 19.4 percent from the previous year.

The delinquency rate fell 3.2 percentage points to 6 percent over the year. The delinquency rate of loans to companies declined 4.7 percentage points to 6.3 percent, while that for households dipped 1.1 percentage points to 5.7 percent.

Their capital adequacy ratio edged down 0.14 percentage point to 14 percent.

"In 2016, the savings bank industry improved its financial soundness with efforts to reduce bad assets," the FSS said. "But thorough risk management is needed for the possibility of an increased debt payment burden for low-income borrowers in case of worsened economic conditions." (Yonhap)