iM Financial Group posted a slight decline in net profit in the first half of this year, as increased non-recurring costs offset gains from expanded corporate lending and improved performance in its securities business.
iM Financial Group said on the 27th that its net profit attributable to controlling shareholders came to 295.6 billion won in the first half of this year, down 4.4% from a year earlier. Second-quarter net profit also fell 8.9% year-on-year to 141.1 billion won.
While core earnings grew on asset expansion at the group's banking and capital units, net profit declined due to non-recurring costs, including a change in the education tax rate applied from this year, and an increase in provisions.
Interest income in the first half rose 4.1% from the same period last year to 843.6 billion won, reflecting asset growth at the banking and capital units and effective net interest margin (NIM) management. Non-interest income also rose 5.2% year-on-year to 265.4 billion won, as fee income improved, led by the securities unit. However, the trading and IB divisions were somewhat sluggish amid heightened capital market volatility.
By affiliate, iM Bank's first-half net profit fell 4.2% from a year earlier to 245.7 billion won. However, corporate lending grew 5.9%, pushing the balance of won-denominated loans past 60 trillion won for the first time. The delinquency rate stood at 0.87%, the non-performing loan (NPL) ratio at 0.94%, and the credit cost ratio also remained stable at 0.41%.
iM Securities saw its first-half net profit decline 14.5% from the same period last year to 44.9 billion won, as the burden of selling and administrative expenses weighed despite growth in net operating revenue. In contrast, iM Capital's net profit rose 33.0% to 39.5 billion won on the back of expanded operating assets, while iM Life's net profit grew 31.9% to 18.2 billion won.
The board of iM Financial Group resolved on the same day to buy back and cancel an additional 30 billion won worth of treasury shares. The amount is 50% higher than the 20 billion won in the second half of last year. Upon completion, the cumulative scale of share buybacks and cancellations will increase to 130 billion won. The company plans to buy back and cancel a total of 150 billion won worth of treasury shares by 2027.
"Despite solid asset growth, our common equity tier 1 (CET1) ratio improved to a record-high 12.27% in the first half through capital management that takes risk weights into account," said Cheon Byeong-gyu, chief financial officer (CFO) of iM Financial Group (139130). "We will manage the capital ratio stably through the end of the year and enhance shareholder value through measures such as tax-free dividends."
