South Korea's five major financial holding companies achieved a combined net profit exceeding 13 trillion won in the first half, marking a record high. KB Financial, Shinhan Financial, Hana Financial, Woori Financial, and NH Nonghyup Financial posted a total net profit of 13.1183 trillion won in the first half, up 9.7% from 11.9548 trillion won in the same period last year, according to the financial sector on the 27th. The record performance was driven by an unprecedented stock market boom that boosted fee income from securities and asset management subsidiaries, while banks maintained stable interest income from traditional lending operations. The five holdings achieved a historic shift in revenue structure, with non-bank subsidiaries' profit contribution rising to as high as 44% at KB Financial, marking a clear departure from the previous bank interest-centered profit model.
Five Financial Holdings Post Record 13.1 Trillion Won First-Half Net Profit
The five major financial holdings surpassed 13 trillion won in combined first-half net profit for the first time. KB Financial led with 3.8846 trillion won, up 13.1% year-over-year, approaching the 4 trillion won threshold. Shinhan Financial followed with 3.4427 trillion won, trailing by 400 billion won. Hana Financial posted 2.4029 trillion won, NH Nonghyup Financial recorded 1.7791 trillion won, and Woori Financial achieved 1.609 trillion won. Four of the five holdings set first-half records, with Woori Financial rebounding in the second quarter after a first-quarter decline.
Second Quarter Net Profit Reaches Historic 6.9 Trillion Won
The five holdings' combined second-quarter net profit reached 6.9201 trillion won, setting a new quarterly record. This represented a 9.6% increase from 6.314 trillion won in the same period last year. KB Financial recorded 1.9922 trillion won, up 14.6% year-over-year, while Shinhan Financial posted 1.8201 trillion won, up 12.2%, both achieving record quarterly profits. Hana Financial and Woori Financial reported 1.1928 trillion won and 1.0046 trillion won respectively, up 1.7% and 66.4% from the previous year. Both KB Financial and Shinhan Financial approached the 2 trillion won quarterly profit milestone.
Interest and Non-Interest Income Both Grow in First Half
The holdings achieved robust performance amid market volatility from Middle East conflicts and rising exchange rates and interest rates through dual growth in interest and non-interest income. First-half interest income reached 26.5469 trillion won, up 1.3588 trillion won (5.3%) year-over-year. Corporate lending, representing productive finance, increased significantly to support bank interest income growth. Rising market interest rates driven by rate hike expectations also contributed to margin expansion. The holdings defended their net interest margin (NIM) by restructuring loan assets around corporate lending under strengthened household loan regulations from financial authorities.
Non-Bank Subsidiaries Drive Profit Structure Transformation
Non-interest income growth stood out in the first-half results. An unprecedented stock market boom caused trading volume to surge, sharply increasing profits from securities and asset management subsidiaries based on fee income. According to the Korea Exchange, the domestic stock market's daily average trading volume in the second quarter reached approximately 90 trillion won, up nearly 40% from 66 trillion won in the first quarter. First-half non-interest income hit a record 10.9032 trillion won, up 27.6% (2.3594 trillion won) from 8.5438 trillion won in the same period last year. While interest income still contributed more to overall performance, non-interest income growth accelerated more sharply. The increase in non-interest income (2.3594 trillion won) exceeded interest income growth (1.3588 trillion won) by over 1 trillion won.
KB Financial's first-half non-interest income reached 3.6292 trillion won, up 33.3% year-over-year. Shinhan Financial and Woori Financial increased 19.7% and 20.0% respectively. Hana Financial's fee income grew 37.7% (406.9 billion won) to 1.4874 trillion won. NH Nonghyup Financial recorded 1.9599 trillion won in non-interest income, up 47.4% year-over-year, the largest growth among major holdings, driven by increased stock trading brokerage revenue and fee income from expanded assets under management (AUM).
KB Financial's non-bank profit contribution rose to a record 44%, up 5 percentage points from last year (39%) and 1 percentage point from the first quarter (43%). Shinhan Financial's capital market division posted 652.7 billion won in net profit, up 126.5% year-over-year, pushing non-bank contribution to 35%, up 5.3 percentage points from last year. Hana Financial's non-bank contribution rose from 12% to 18.8%. NH Nonghyup increased from 28.2% to 39.7% thanks to securities subsidiary performance, while Woori Financial reached 22.3%, more than triple last year's 6.9%, reflecting the full impact of insurance company integration alongside securities growth.
Securities Firms Outpace Banks in Profit Rankings
The expansion of non-bank contribution signifies a structural change in financial holding performance, previously centered on banks. Fee income centered on securities emerged as a core driver. The first-half net profit rankings of the four major holdings (KB, Shinhan, Hana, Woori) matched the rankings of their securities subsidiaries, not their banks. KB Securities' first-half net profit reached 796.3 billion won, up 135% from last year. In the second quarter alone, it recorded 448.5 billion won, up 182.1% year-over-year. Shinhan Investment & Securities posted 577.7 billion won in first-half net profit, up 123.1%. Hana Securities recorded 273.1 billion won, up 155.7%, and Woori Investment & Securities achieved 24.7 billion won, up 47.1%.
Among banks, Shinhan Bank posted the largest net profit in the first half, as in the first quarter. Shinhan Bank's net profit reached 2.4585 trillion won, slightly ahead of Kookmin Bank's 2.2254 trillion won. Hana Bank followed with 2.1211 trillion won, and Woori Bank recorded 1.373 trillion won. A financial industry official stated, "The saying that financial holdings only make money from bank interest business is now outdated. Steadily pursued portfolio diversification combined with an unprecedented stock market boom maximized non-interest and non-bank profits."
FAQ
What was the combined first-half net profit of South Korea's five major financial holdings?
The five major financial holdings—KB Financial, Shinhan Financial, Hana Financial, Woori Financial, and NH Nonghyup Financial—achieved a combined net profit of 13.1183 trillion won in the first half, up 9.7% from 11.9548 trillion won in the same period last year. This marked the first time their first-half profit exceeded 13 trillion won.
Why did non-interest income grow faster than interest income in the first half?
Non-interest income surged 27.6% to 10.9032 trillion won, driven by an unprecedented stock market boom that caused daily average trading volume to reach approximately 90 trillion won in the second quarter. Fee income from securities and asset management subsidiaries increased sharply, with the growth in non-interest income (2.3594 trillion won) exceeding interest income growth (1.3588 trillion won) by over 1 trillion won.
How much did non-bank subsidiaries contribute to KB Financial's first-half profit?
Non-bank subsidiaries, including securities and asset management firms, contributed 44% to KB Financial's first-half profit, a record high. This represented an increase of 5 percentage points from last year's 39% and 1 percentage point from the first quarter's 43%.
