Non-interest income lifts profit despite narrowing lending margin
Kakao Bank, South Korea’s largest online-only lender, posted a record net profit in the first half of this year, driven by strong growth in non-interest income.
Net profit rose 14 percent from a year earlier to 231.4 billion won ($166.5 million) for the January–June period, with 126.3 billion won earned in the second quarter. Operating revenue climbed 7.6 percent to 1.56 trillion won.
Non-interest income jumped 30.4 percent to a record 562.6 billion won, accounting for 36 percent of total revenue. Platform and fee-based income rose 8.3 percent to 153.5 billion won.
“The company’s platform capabilities have strengthened across lending, investment and payments, while revenues from firm banking, open banking and advertising grew steadily,” a Kakao Bank official said. The lender attributed the gains to a more diversified revenue mix.
Investment income reached 345.8 billion won, supported by efficient asset allocation strategies, the bank said.
Interest income declined 2 percent on-year to 999.9 billion won, in line with broader industry trends amid tighter household debt regulations, elevated borrowing costs and a slowing economy. The bank’s net interest margin narrowed 17 basis points to 1.92 percent.
Kakao Bank’s customer base grew to 25.86 million as of end-June, adding 1 million users this year. Monthly active users rose by the same margin in the second quarter, reaching 19.9 million.
Beyond the numbers, the bank expanded its service offerings, notably with the launch of artificial intelligence-based features, including an AI-powered search and calculator.
Its overseas digital banking push is also gaining momentum. A consortium with Thailand’s SCBX won regulatory approval in July to launch a virtual bank, with operations set to begin in the second half of 2026. In Indonesia, Superbank, in which Kakao Bank is a major investor, has attracted over 3 million customers in a year.
jwc@heraldcorp.com
