ID :
59450
Thu, 05/07/2009 - 17:09
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https://oananews.org//node/59450
The shortlink copeid
IBK Q1 net plunges 85.3 pct
SEOUL, May 7 (Yonhap) -- South Korea's state-invested Industrial Bank of Korea
(IBK) said Thursday its first-quarter earnings tumbled 85.3 percent from a year
earlier due mainly to higher loan-loss reserves.
Net profit amounted to 47.9 billion won (US$37.9 million) in the January-March
period, compared with 325.1 billion won the previous year, the lender said in a
regulatory filing. But compared with three months earlier, net income more than
tripled on consistent lending growth and cost-cutting efforts.
The South Korean government maintains a 57.7 percent stake in IBK.
"The on-year fall in bottom line resulted from higher provisioning to cover
possible loan losses amid the slumping economy," said the bank which caters
mainly to small and medium enterprises. IBK put aside 550.3 billion won in such
reserves in the first quarter, up 116 percent from a year earlier.
South Korean banks, which are in the process of restructuring ailing companies,
are putting aside more reserves to cover potential losses on growing problem
loans.
The lender's net interest margin (NIM), a key barometer of profitability, reached
2.37 percent in the first quarter, down from 2.53 percent three months earlier as
returns on certificates of deposit (CDs), which are tied to lending rates,
sharply declined.
South Korea's central bank made six consecutive rate cuts totaling 3.25
percentage points to an all-time low of 2 percent until February, pulling down
market rates such as yields on CDs.
IBK's capital adequacy ratio, a key gauge of financial soundness, came in at
11.75 percent as of end-March, up from 11.54 percent from the end of last year.
But the bank's loan delinquency rate is on the rise as the slowing economy is
increasing the amount of bad loans. Its loan default rate came in at 1.06 percent
as of the end of March, up from 0.85 percent the previous quarter as more
companies were delinquent in repaying loans.
IBK's total assets reached 150.9 trillion won, up 16.6 percent from a year ago,
it added.
sooyeon@yna.co.kr
(END)
(IBK) said Thursday its first-quarter earnings tumbled 85.3 percent from a year
earlier due mainly to higher loan-loss reserves.
Net profit amounted to 47.9 billion won (US$37.9 million) in the January-March
period, compared with 325.1 billion won the previous year, the lender said in a
regulatory filing. But compared with three months earlier, net income more than
tripled on consistent lending growth and cost-cutting efforts.
The South Korean government maintains a 57.7 percent stake in IBK.
"The on-year fall in bottom line resulted from higher provisioning to cover
possible loan losses amid the slumping economy," said the bank which caters
mainly to small and medium enterprises. IBK put aside 550.3 billion won in such
reserves in the first quarter, up 116 percent from a year earlier.
South Korean banks, which are in the process of restructuring ailing companies,
are putting aside more reserves to cover potential losses on growing problem
loans.
The lender's net interest margin (NIM), a key barometer of profitability, reached
2.37 percent in the first quarter, down from 2.53 percent three months earlier as
returns on certificates of deposit (CDs), which are tied to lending rates,
sharply declined.
South Korea's central bank made six consecutive rate cuts totaling 3.25
percentage points to an all-time low of 2 percent until February, pulling down
market rates such as yields on CDs.
IBK's capital adequacy ratio, a key gauge of financial soundness, came in at
11.75 percent as of end-March, up from 11.54 percent from the end of last year.
But the bank's loan delinquency rate is on the rise as the slowing economy is
increasing the amount of bad loans. Its loan default rate came in at 1.06 percent
as of the end of March, up from 0.85 percent the previous quarter as more
companies were delinquent in repaying loans.
IBK's total assets reached 150.9 trillion won, up 16.6 percent from a year ago,
it added.
sooyeon@yna.co.kr
(END)
