Seoul: Credit card companies in South Korea saw their combined net profit plunge by more than 18 percent from a year earlier, due to a fall in commission income and increased financial costs, data showed Friday. The combined net profit of eight credit card firms came to 1.23 trillion won (US$883 million) in the January-June period, down 18.3 percent from a year earlier, according to the data from the Financial Supervisory Service (FSS).
According to Yonhap News Agency, the combined revenue of these credit card firms increased 2.4 percent, or 331 billion won, to 14.34 trillion won over the cited period. However, combined costs increased by a larger margin of 4.8 percent, or 605 billion won, to 13.11 trillion won. The delinquency ratio reached 1.76 percent as of end-June, up 0.11 percentage point from six months ago, marking the highest since end-December in 2014, when the comparable figure was 1.69 percent.
Transactions by credit and debit cards rose 2.7 percent on-year, or 15.4 trillion won, to 595.7 trillion won in the first six months of the year. Meanwhile, the financial regulator noted that the combined net profit of specialized credit finance companies, excluding credit card firms, rose to 1.78 trillion won during the first half of the year, up 14.5 percent from a year earlier. There were 183 specialized credit finance firms, according to the FSS, which include installment financing, leasing, and new technology venture businesses.