KakaoBank (323410) Q2 2024 earnings summary

Executive summary

• Customer base expanded by 1.19 million year-to-date to 24.03 million, up 10.5% YoY, with improved delinquency rates and record-high operating profit in H1.

• Achieved record operating income in H1 2024, driven by customer growth, stable risk management, and interest revenue growth.

• Operating profit up 52% YoY and 14% QoQ, with operating revenue in Q2 at KRW 734.1 billion, up 2% QoQ.

• Asset quality remained sound, with delinquency rate at 0.48% and credit cost ratio down to 0.53%.

Financial highlights

• Q2 operating profit reached a record high, with a 28% YoY increase in H1 and net profit up 47% YoY to KRW 120.2 billion.

• Operating revenue rose 20% YoY and 2% QoQ to KRW 734.1 billion in Q2.

• Total assets grew 20.8% YoY to KRW 61.0 trillion; loans up 24.2% YoY to KRW 42.7 trillion; deposits up 22.5% YoY to KRW 53.4 trillion.

• Financial investments reached KRW 14.7 trillion in H1, up 7% YoY, with investment profit up 22% YoY to KRW 251.7 billion.

• CIR improved to 35.4% in H1 2024 from 42.6% in 2023, while SG&A rose 11% YoY.

Outlook and guidance

• Loan growth guidance remains unchanged, focusing on SOHO business owner loans and portfolio expansion.

• Full-year NIM guidance is around 2.2%, but may be slightly lower due to market rate declines; NIM expected to improve in H2.

• Plans to expand SOHO subsidized loan coverage to 80% of regions and launch online SOHO secured loan product in 2025.

• Value-up program to be disclosed in Q4, focusing on growth, efficiency, inclusive finance, dividend policy, and treasury share management.

• App home screen renewal in August to enhance benefit-based service visibility.