The Korea Herald

지나쌤

KEB’s Q2 net jumps more than eightfold

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Published : Aug. 10, 2011 - 19:22

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Korea Exchange Bank, South Korea’s No. 5 lender, said Wednesday that its second-quarter earnings jumped more than eight times from a year earlier on a one-off profit from the sale of a stake in a local builder and improved interest margins.

Net income amounted to 1.13 trillion won ($1.05 billion) in the April-June period, up 726 percent from the previous year, said the bank. In the first half, net profit soared 162 percent on-year to 1.33 trillion won.

Revenues inched down 9.8 percent on-year to 3.61 trillion won while operating profits jumped 699 percent to 1.49 trillion won, it added.

The improved bottom line came as KEB logged an after-tax one-time gain worth 876 billion won by selling its stake in Hyundai Engineering & Construction Co.

KEB’s net interest margin, a gauge of profitability, came in at 2.72 percent in the second quarter, up from 2.63 percent three months earlier.

Korean banks’ NIMs have been on the rise mainly because they can charge more interest on their lending amid the central bank’s tightening cycle.

Hana Financial Group agreed with U.S. buyout fund Lone Star Funds last month to extend a deal to buy a 51.02 percent stake in KEB until November with a price of 4.41 trillion won.

But KEB’s decision to pay out a record interim dividend to its biggest shareholder Lone Star has drawn strong public criticism that the fund is trying to exit from the Korean market after fattening its pockets. (Yonhap News)