Archive · 23 Aug 2026
South Korean Banks’ Profits Fall as Interest Income Hits Record
South Korean banks made less total money in the first half of 2026 than they did a year earlier.
Their combined profit was 13.8 trillion won.
Banks earned a record amount from interest, reaching 32.2 trillion won.
However, they made much less money from other activities.
Earnings connected to the KOSPI stock market turned into a large loss.
The Financial Supervisory Service said higher overdue loans could create more problems for banks.
It also warned that uncertainty from the Middle East war could affect them.
Meanwhile, experts think South Korea’s economy may grow faster than previously expected.
They believe the Bank of Korea could raise its growth forecast to between 3 percent and 3.4 percent.
The combined net income of 20 South Korean banks fell 6.4 percent to 13.8 trillion won in the first half of 2026.
Bank interest income rose 8.3 percent year-on-year to a record 32.2 trillion won.
Non-interest income dropped 43.4 percent to 2.9 trillion won, with KOSPI-related profits posting a 2.5 trillion-won deficit.
The Financial Supervisory Service warned that Middle East conflict and rising delinquency rates could pressure banks’ financial soundness.
Economic analysts expect the Bank of Korea to raise its 2026 growth forecast from 2.6 percent to as much as 3.4 percent.
- Who
- Twenty South Korean banks, the Financial Supervisory Service, the Bank of Korea, and six surveyed economic analysts.
- What
- Banks’ combined first-half net income declined while interest income reached a record high; analysts also anticipated a higher 2026 growth forecast.
- When
- The results cover January through June 2026, with the data and analyst expectations reported on Sunday.
- Where
- South Korea.
- Why
- Net income fell mainly because non-interest income declined, particularly from KOSPI-related activities, while the growth outlook improved because of strong semiconductor exports and recovering domestic demand.
- Banks covered
- 20 South Korean banks
- Net income
- 13.8 trillion won, down 6.4 percent year-on-year
- Interest income
- 32.2 trillion won, up 8.3 percent year-on-year and the highest six-month figure on record
- Non-interest income
- 2.9 trillion won, down 43.4 percent year-on-year
- KOSPI-related result
- A 2.5 trillion-won deficit in the first half
- Current 2026 growth outlook
- 2.6 percent
- Potential revised growth outlook
- As high as 3.4 percent