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S. Korea credit card firms' H1 net falls 0.9 pct

10:01 August 15, 2019

SEOUL, Aug. 15 (Yonhap) -- South Korean credit card companies posted a 0.9 percent on-year decline in first-half net profit as decreased commissions weighed on their bottom lines, data showed Thursday.

From January to June, the country's eight card firms -- Shinhan, Samsung, KB Kookmin, Hyundai, BC, Lotte, Woori and Hana -- reported a combined net profit of 957.8 billion won (US$788 million), down from 966.9 billion won a year earlier, according to their earnings results.

The financial authorities lowered the commissions card companies receive from their member stores in March. It affected card firms' financial results in the first six months of the year.

To offset the decreased commission income, card firms have tried to cut costs and diversify their income sources by selling auto financing, insurance and other financial products, industry officials said.

For the rest of the year, card companies don't expect any meaningful rebound in their financial results.

In the second half, they said the loan default rate may rise and the pace of growth in credit sales may slow down from 19.4 trillion won in the first half amid sluggish domestic consumption.

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