Foreign banks in South Korea see earnings fall in 2021

Fee and commission income shrank by over 230% during the fiscal year.

Foreign banks operating in South Korea generated a total net income of over $901.41m (KRW1.14t) in the financial year 2021, a decrease of 4.5% or $42.3m (KRW53.5b) compared to the previous fiscal year, according to data released by the Financial Supervisory Service (FSS).

Whilst their interest income grew KRW303.4b, non-interest income fell by KRW445.5b year on year. Meanwhile, return on assets (ROA) stood at 0.35%, down 0.02 percentage point (ppt) from a year ago.

Interest income of the 35 foreign bank branches in Korea came in at KRW1.85t for FY2021, a 19.5% or KRW303.4b increase compared to FY2020. 

This was offset by branches’ fee and commission income contracting 233.5% to a minus KRW33.6b during the same period. 

Securities-related losses also surged 378.6% to over minus KRW1.04t.

Meanwhile, loan loss provisions of the branches shrank from KRW128.3b to minus
KRW9.9b during the same period.

(US$1 = KRW 1264.35)