South Korea's Five Biggest Financial Groups Earn Record 19.63 Trillion Won as Quarterly Momentum Slows

Record profits conceal a weaker third quarter

South Korea's five largest financial groups earned a record 19.6297 trillion won in the first nine months of 2026, up 8.62% from 18.0723 trillion won a year earlier. Growing corporate lending and stronger fees from securities trading and wealth management lifted earnings, even as their latest quarterly results showed pressure from rising funding costs and weaker investment businesses.

KB Financial Group led with 5.7921 trillion won in net profit, followed by Shinhan Financial Group with 5.0274 trillion won. Together, they earned 10.8195 trillion won, about 55.1% of the five groups' combined profit. Hana Financial Group, Woori Financial Group and NH NongHyup Financial Group accounted for the remainder.

The July to September results told a more cautious story. Combined profit reached 6.5114 trillion won, up 6.44% from the same quarter a year earlier but down 5.9% from the preceding quarter. KB, Shinhan and NH NongHyup all earned less than in April to June, while Hana and Woori improved.

Two developments explain how record cumulative profits and a quarterly slowdown happened together. Lending growth supported interest income throughout the first nine months. Securities and insurance businesses, which had helped drive earnings earlier in the year, then lost momentum during the third quarter.

The five groups' cumulative interest income rose 6.4% to 40.5034 trillion won, while income from fees, investments and other activities increased 19.1% to 14.5951 trillion won. Those are income measures before the full range of expenses and other charges that determine net profit.

For shareholders, the strong cumulative results supported larger dividends and share repurchases. For the groups, the immediate challenge was more practical: keep lending profitable while paying more to attract deposits and borrow money, and manage investment businesses whose earnings can change sharply between quarters.

How the five groups compare

Four of the five groups increased their January to September profits. KB's earnings rose 13.09%, Shinhan's increased 12.7%, Hana's advanced 5.56% and NH NongHyup's grew 11.85%. Woori was the exception, with reported profit falling 4.95%.

• KB Financial Group: 5.7921 trillion won in cumulative net profit.
• Shinhan Financial Group: 5.0274 trillion won.
• Hana Financial Group: 3.6243 trillion won.
• Woori Financial Group: 2.6581 trillion won.
• NH NongHyup Financial Group: 2.5278 trillion won.

Woori said its comparison was affected by a gain recorded a year earlier when it acquired insurers. Such an acquisition can produce an accounting gain when the assessed value of the acquired net assets exceeds the purchase price. Excluding that exceptional benefit, Woori said its cumulative profit increased 18.7%.

KB, Shinhan, Hana and Woori together earned 17.1019 trillion won through September, putting a first combined annual profit above 20 trillion won within reach. NH NongHyup had already exceeded its own previous annual result: its nine month profit of 2.5278 trillion won was above the 2.5112 trillion won earned throughout 2025.

More lending brought more interest income

Corporate lending was a central source of growth as household loan expansion remained limited. A larger loan book can generate more interest income even when the return earned on each unit of lending becomes less attractive.

KB recorded the largest cumulative interest income, at 9.9853 trillion won, followed by Shinhan at 9.3493 trillion won. Hana earned 7.4832 trillion won, Woori 7.0359 trillion won and NH NongHyup 6.6497 trillion won.

Hana had the fastest growth in this income stream, at about 10.4%. Shinhan followed at 7.9%, NH NongHyup at 7.5%, Woori at 4.5% and KB at 2.9%. All five therefore increased interest income, despite different growth rates and different contributions from their other businesses.

Why bank margins fell despite higher income

Higher market interest rates also raised the cost of funding loans. Banks obtain money through customer deposits and borrowing, including issuing bonds. When those costs rise faster than the income generated by their assets, their lending becomes less profitable at the margin.

Net interest margin, or NIM, measures net interest income relative to assets that earn interest. It helps show how much a bank earns from the difference between interest received and interest paid. A bank can report a lower margin while still increasing total interest income if its lending grows enough.

KB Kookmin Bank's third quarter NIM fell to 1.72%, down 0.02 percentage points from the preceding quarter. Shinhan Bank's declined 0.03 percentage points to 1.58%, Hana Bank's fell 0.04 percentage points to 1.57%, and Woori Bank's dropped 0.07 percentage points to 1.43%.

NH NongHyup's combined bank and card margin, measured cumulatively, fell from 1.74% for the first half to 1.71% for the first nine months. Its measurement period and business coverage differ from the individual banks' quarterly figures.

Customers moving money out of deposits that pay little interest added to funding pressure. Banks then had to rely more on deposits or borrowing with higher costs. Seo Ki-won, a vice president at KB Kookmin Bank, told the earnings presentation that efficiently managing the funding burden would be very important.

Fees surged before the market slowdown

Securities trading, investment products and wealth management supplied much of the growth outside lending. Combined cumulative income from activities other than interest reached 14.5951 trillion won, rising 19.1%, almost three times the 6.4% growth rate in interest income.

KB's cumulative net fee income rose 38.5% to 4.0878 trillion won. Securities business commissions increased 150.2%, while trust income grew 92.6%. Trust businesses manage assets on behalf of customers and earn fees for doing so.

Hana's cumulative fee income increased 29.8% to 2.1428 trillion won, supported by wealth management and investment banking. Investment banking includes services such as helping companies raise money and arranging financial transactions.

Shinhan's cumulative income outside interest rose 8.2% to 3.4283 trillion won, helped by securities brokerage fees. Woori's increased 13.9% to 1.6444 trillion won, supported by the addition of insurers and closer cooperation among subsidiaries. Its investment banking fees more than doubled.

NH NongHyup recorded the strongest growth in income outside interest, up 38.5% to 2.5986 trillion won. NH Investment & Securities earned 1.3489 trillion won over the first nine months, an increase of 80.3%, while NH-Amundi Asset Management's profit rose 242.3% to 88.7 billion won.

The third quarter reversed some of that momentum. Combined income outside interest fell 39.9% from the preceding quarter to 3.6915 trillion won. Lower stock trading activity reduced fees, while weaker returns from securities investments also weighed on results.

Banks carried more of the quarterly burden

Hana Securities' third quarter net profit fell 93.9% from the preceding quarter to 10.3 billion won. Shinhan Investment Securities' profit declined 77.4% to 65.3 billion won, and KB Securities' fell 39.5% to 271.2 billion won. Woori Investment Securities also recorded a steep decline of 72.7%.

KB Securities still earned 71.9% more than in the same quarter a year earlier. Its simultaneous annual increase and quarterly decrease show how strong earlier growth could coexist with a sudden loss of momentum.

Insurance subsidiaries weakened too. KB Insurance's quarterly profit fell 27.3% from the preceding quarter to 202.3 billion won, Shinhan Life's declined 31.3% to 128.8 billion won, and Tongyang Life's dropped 62.2% to 25.3 billion won. NH NongHyup Life and Hana Life recorded losses.

The banking subsidiaries provided support. KB Kookmin Bank's quarterly profit rose 20.1% from the preceding quarter to 1.3509 trillion won, while Shinhan Bank's increased 12.5% to 1.2252 trillion won. Hana Bank and Woori Bank improved by 17.5% and 22%, respectively.

Across the first nine months, the five banking subsidiaries earned 14.7286 trillion won, up 7.3% from 13.7268 trillion won. Shinhan Bank led with 3.6837 trillion won, ahead of KB Kookmin Bank's 3.5763 trillion won and Hana Bank's 3.3157 trillion won.

KB's share of group profit from businesses outside banking fell from 44% in the first half to 40% over nine months. Hana's fell from 18.8% to 14.6%. At Woori, the banking subsidiary supplied more than 90% of cumulative group profit.

NH NongHyup's record included a credit cushion

NH NongHyup's third quarter profit of 748.7 billion won rose 18.6% from a year earlier but fell 17.8% from the preceding quarter. Its interest income slipped just 0.9% to 2.2075 trillion won, while income outside interest dropped 39.5% to 638.7 billion won.

A reversal of credit loss provisions softened the fall. Provisions are amounts set aside to cover expected losses on loans. Recoveries and changes in expected losses can allow some of that money to be released back into earnings.

NH NongHyup recorded a net provision reversal of 52 billion won in the third quarter, compared with a provision expense of 253.4 billion won in the second quarter. The group attributed its management of provision expenses to recoveries on large troubled loans and provisions booked earlier.

Its reserves relative to troubled loans nevertheless became thinner. The provision coverage ratio fell from 155.31% at June's end to 144.67% at September's end. The group's nonperforming loan ratio stayed at 0.65%, while NH NongHyup Bank's delinquency rate rose from 0.46% to 0.54%.

NH NongHyup's loan book reached 391.9 trillion won at September's end, up 16 trillion won from the end of 2025. That is growth of about 4.3%, calculated from a starting balance of 375.9 trillion won. Larger lending supported income while increasing the amount of credit the group had to monitor.

Shareholders receive more as capital stays above 13%

KB planned 1.9 trillion won in share repurchases and cancellations during 2026. Including cash dividends, its total shareholder returns were expected to reach about 3.7 trillion won. Its board approved a quarterly dividend of 1,167 won per share, up 237 won from a year earlier.

Shinhan planned 3 trillion won in shareholder returns, comprising 1.6 trillion won in share purchases and 1.4 trillion won in cash dividends. Of an additional 450 billion won approved for repurchases, 250 billion won was scheduled for January 2027.

Hana added 250 billion won to its repurchase and cancellation programme, bringing the annual amount to 949 billion won. Woori planned 350 billion won, an increase of 133.3% from the previous year. Quarterly dividends were set at 740 won per share for Shinhan, 1,165 won for Hana and 220 won for Woori.

Share repurchases return money to investors by buying shares from the market. Cancelling those shares reduces the number outstanding. Dividends pay cash directly to shareholders.

Capital levels provide another part of the picture. At September's end, common equity Tier 1 ratios were 13.80% for KB and Woori, 13.62% for Shinhan, 13.45% for Hana and 13.05% for NH NongHyup. This ratio compares a group's core equity capital with assets adjusted for risk, indicating its capacity to absorb losses.

NH NongHyup strengthened its capital through a 1.2 trillion won rights issue funded by the National Agricultural Cooperative Federation in June. Its capital ratio rose from 12.98% at June's end to 13.05% at September's end.

The dates behind the results

The earnings announcements combined nine months of accumulated profit with a third quarter that was weaker than the second. The sequence helps explain why groups could announce records while discussing pressure on their businesses.

• June 2026: NH NongHyup received 1.2 trillion won in new equity capital.
• July to September 2026: Combined quarterly profit reached 6.5114 trillion won, below the preceding quarter but above a year earlier.
• September 30, 2026: The nine month reporting period ended, with combined profit at 19.6297 trillion won.
• October 28, 2026: NH NongHyup disclosed its quarterly results.
• October 29, 2026: KB announced its results and approved its quarterly dividend, as the five groups' combined earnings were tallied.
• January 2027: Shinhan scheduled 250 billion won of its additional share repurchases.

Full year earnings were not yet known. KB was 207.9 billion won short of 6 trillion won in annual profit after September, while the four groups excluding NH NongHyup needed another 2.8981 trillion won to reach a combined 20 trillion won. Fourth quarter funding costs, market activity and credit expenses would determine their final results.

Key Points

• The five largest financial groups earned a record 19.6297 trillion won in the first nine months of 2026, up 8.62%.
• KB and Shinhan generated about 55.1% of combined profit.
• Cumulative interest income rose 6.4%, while income outside interest increased 19.1%.
• Third quarter profit fell 5.9% from the preceding quarter as securities and insurance earnings weakened.
• Bank margins narrowed as funding became more expensive, despite growth in lending income.
• Woori's reported profit declined, but it said earnings rose 18.7% excluding an earlier acquisition gain.
• Listed groups expanded shareholder returns, while all five reported September capital ratios above 13%.