S. Korean banks’ net income falls in H1; interest profit hits record high

Seoul, Aug 23 (IANS) Net profits of South Korean banks fell in the first half of 2026, mainly due to a fall in non-interest income, while their interest income recorded the highest six-month figure on record, data showed on Sunday.

The combined net income of 20 banks came to 13.8 trillion won (US$9.95 billion) in the January-June period, down 6.4 percent from the same period a year earlier, according to the data from the Financial Supervisory Service (FSS).

Their interest income came to 32.2 trillion won in the first half, up 8.3 percent on-year, reports Yonhap news agency.

Non-interest income came to 2.9 trillion won, sharply falling by 43.4 percent from the same period a year earlier, according to the FSS.

The drop in non-interest income was blamed on a fall in profits related to the benchmark KOSPI market, amid a rise in interest rates, the FSS said. Profits related to the KOSPI swung to the red in the first half, generating a deficit of 2.5 trillion won.

The FSS said external uncertainties, such as the Middle East war, and increasing delinquency rates could pose a burden on the fiscal soundness of banks, as it vowed to strengthen monitoring and encourage banks to take measures to expand their loss-absorption capacities.

Meanwhile, the Bank of Korea (BOK) is expected to raise its growth outlook for the South Korean economy this year to over 3 percent, economic experts here said on Sunday, citing stronger-than-expected semiconductor exports and recovering domestic demand.

According to a recent survey on six economic analysts conducted by Yonhap News Agency, respondents expect the BOK to revise its 2026 growth outlook from the current 2.6 percent to as high as 3.4 percent.

—IANS

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