Card firms’ net profit rises 13.5% in H1

Earnings by South Korean credit card companies rose 13.5 percent in the first half of 2014 from a year earlier due to gains from asset sales, the financial watchdog said Thursday.

The combined net income of eight stand-alone card firms stood at 1.07 trillion won ($1.05 billion) in the January-June period, compared with 946.3 billion won the previous year, according to the Financial Supervisory Service. The jump in the net income came as their gains in stock sales offset a drop in interest income and a rise in costs, noted the FSS.

For one, Samsung Card earned 209.1 billion won from selling off its stake in Cheil Industries Inc. and Samsung Fire and Marine Insurance, affiliates of Samsung Group.

Their interest income fell 13.3 percent on-year to 177.1 billion won, while bad loan expenses jumped 29 percent to 848.2 billion won over the cited period.

By firm, Shinhan Card logged the largest first-half profit at 328.4 billion won, but the figure marks a 12.3 percent drop from a year earlier. Samsung Card came in second with a profit of 262.6 billion won, followed by KB Kookmin Card with 190.9 billion won and Hyundai Card with 119.4 billion won, according to the FSS.

Card spending rose 5 percent, or 14.2 trillion won, to 296.4 trillion won over the cited period, driven by a sharp rise in debit card purchases.

Debit card payments amounted to 53.3 trillion won in the first six months of the year, up 25.7 percent from a year earlier, while credit card purchases edged up 1.4 percent on-year to 243.1 trillion won.

The delinquency ratio of loans of the card firms stood at 1.93 percent as of the end of June, up 0.11 percentage point from the end of last year, the FSS said. (Yonhap)