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Card firms' H1 net dips 32 pct

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(Globalpost/GlobalPost)

SEOUL, Aug. 28 (Yonhap) -- Earnings by credit card companies in South Korea shrank 32 percent in the first half from a year earlier, largely due to a sharp fall in gains from stake sales in other firms, the financial regulator said Wednesday.

The combined net income of seven stand-alone card firms came to 957.2 billion won (US$856 million) in the January-June period, compared with 1.41 trillion won the previous year, according to the Financial Supervisory Service (FSS).

The half-yearly performance of Woori Card Co., which recently spun off from Woori Bank in April, was not included in the data, the FSS added.

The weaker bottom line came as card firms saw profits from sales of stakes decline sharply in the first half.

Last year, Samsung Card Co. and Shinhan Card Co., two major players, earned profits on stake sales of Samsung Everland Co. and Visa Card, respectively, worth more than 600 billion won combined.

In this first half, only Shinhan Card added another 59.8 billion won to its one-off profit from the remaining Visa stake sale, bringing down the overall figure for the industry.

The delinquency ratio of loans held by eight credit card firms, including Woori Card, stood at 2.03 percent as of the end of June, down 0.08 percentage point from a year ago, the FSS said, citing a hike in their bond issuances as opposed to the amount of their debt write-offs.

Their outstanding assets totaled 77.2 trillion won as of end-June, up by 200 billion won from a year earlier.

South Koreans spent 282.4 trillion won using credit and debit cards in the first half, up 3.4 percent from the previous year. They borrowed 48.6 trillion won through card loans in the first six months of this year, down by 1.6 trillion won from a year ago, according to the regulator.

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