Three regionally based financial holding companies - BNK Financial Group, JB Financial Group and iM Financial Group - posted a combined third-quarter cumulative net profit down 8.2 percent from a year earlier. JB Financial Group kept growing with its best-ever results, but declines at BNK and iM pulled down the combined total. As the net profit gap between BNK and JB narrowed, differences emerged in profitability and asset quality indicators.

The financial sector said on Oct. 28 that the three groups' cumulative third-quarter net profit attributable to controlling shareholders this year totalled 1.63 trillion won. That was down 146.1 billion won, or 8.2 percent, from 1.78 trillion won a year earlier.

By company, BNK posted the largest at 622.3 billion won, followed by JB at 595.7 billion won and iM at 416.3 billion won. From a year earlier, only JB increased, up 2.9 percent, while BNK and iM fell 19.2 percent and 3.6 percent, respectively.

Third-quarter net profit alone was 210.5 billion won for BNK, 210.0 billion won for JB and 120.7 billion won for iM. The gap between BNK and JB was just 500 million won. From the previous quarter, BNK rose 5.0 percent, while JB and iM fell 4.4 percent and 14.5 percent, respectively.

JB posts record results; BNK and iM see profit declines

JB Financial Group delivered the strongest performance among the three. Its cumulative third-quarter net profit of 595.7 billion won rose 2.9 percent from a year earlier, setting a record on a cumulative basis. Third-quarter net profit also rose 0.8 percent to 210.0 billion won, the highest for any third quarter.

Higher interest income and lower credit costs supported the improvement. JB's cumulative third-quarter interest income was 1.65 trillion won, up 9.5 percent from a year earlier. Non-interest income fell 27.6 percent to 147.9 billion won, but provisions declined 3.8 percent to 339.0 billion won, contributing to the profit increase.

Selling, general and administrative expenses rose 8.0 percent to 645.5 billion won. Its cost-to-income ratio was 35.8 percent, up 1.0 percentage point from a year earlier, but remained in the 30 percent range.

JB is continuing a strategy of adjusting its loan portfolio and improving asset efficiency, centred on risk-adjusted returns on risk-weighted assets. Its cumulative won-denominated loan growth in the third quarter was 10.0 percent, while risk-weighted asset growth was held to 5.1 percent.

BNK, meanwhile, saw net profit fall sharply due to a base effect from one-off gains last year and weaker performance in its banking business. The result reflected last year's 100.9 billion won one-off gain from the sale of the BNK Gangnam Core office, along with lower non-interest income this year.

BNK's cumulative net profit from its banking segment was 557.3 billion won, down 16.9 percent from a year earlier. Busan Bank fell 23.5 percent to 321.8 billion won and Kyongnam Bank declined 5.6 percent to 235.5 billion won.

Non-bank affiliates performed relatively well. Net profit in the non-bank segment rose 28.7 percent to 213.7 billion won. BNK Capital rose 7.1 percent to 117.5 billion won, BNK Investment & Securities increased 71.0 percent to 50.1 billion won and BNK Asset Management rose 84.6 percent to 29.9 billion won. Despite higher non-bank profit, the group's overall net profit fell due to weaker banking profit and a base effect from last year's one-off gains.

iM also posted a decline in cumulative net profit as rising costs weighed despite higher interest income.

iM's group loan assets rose 7.6 percent from end-2025, and cumulative interest income increased 5.6 percent from a year earlier. But higher selling, general and administrative expenses, due to the recognition of one-off labour costs and a change in the education tax rate, weighed on net profit.

Cumulative net profit at flagship affiliate iM Bank was 361.5 billion won, down 1.4 percent from a year earlier. Interest income increased as corporate loans rose 10.8 percent from end-2025, but higher selling, general and administrative expenses and lower non-interest income had an impact.

Among non-bank affiliates, iM Capital posted cumulative net profit of 56.5 billion won, up 20.0 percent from a year earlier. iM Securities also recorded stand-alone net profit of 72.2 billion won, up 10.4 percent.

Profitability favors JB; asset quality indicators are better at iM

Differences among the three also showed up in profitability and asset quality indicators.

JB's cumulative third-quarter return on equity was 13.3 percent, the highest among the three. iM recorded 8.82 percent and BNK posted 7.63 percent.

Return on assets was also highest at JB at 1.08 percent, while iM and BNK posted 0.53 percent and 0.52 percent, respectively. JB lagged BNK in the absolute size of net profit, but led in profitability relative to capital and assets.

Asset quality showed a different pattern. JB's third-quarter ratio of substandard or lower loans rose 0.14 percentage point from the previous quarter to 1.57 percent. Its delinquency ratio also rose 0.12 percentage point to 1.76 percent. Both indicators were the highest among the three.

BNK's ratio of substandard or lower loans improved by 0.01 percentage point from the previous quarter to 1.45 percent, but its delinquency ratio rose 0.06 percentage point to 1.40 percent.

iM's ratio of substandard or lower loans fell 0.23 percentage point from the previous quarter to 1.18 percent, and its delinquency ratio dropped 0.16 percentage point to 1.22 percent. Its credit cost ratio also came in at 0.48 percent, extending an improving trend in asset quality.

The common equity tier 1 ratio stood at 12.39 percent for JB and iM, and 12.18 percent for BNK. JB fell 0.14 percentage point from the previous quarter, while iM and BNK rose 0.12 percentage point and 0.04 percentage point, respectively.

Shareholder return policies also continued. BNK approved a quarterly cash dividend of 150 won per share and a 60.0 billion won share buyback in the second half. JB decided on a quarterly cash dividend of 317 won per share, while iM completed a 30.0 billion won share buyback announced in July and plans to cancel the shares in November.

In the third-quarter results of the three regional financial groups, differences emerged not only in whether profits increased but also in asset quality indicators, producing mixed results in profitability and asset quality management by each holding company.

JB explained on a conference call that asset quality indicators could rise as it increases the share of higher-profit loan assets.

A JB official said, "This is because we are working to increase the share of areas where the net interest margin is relatively high and where delinquency rates or NPLs are slightly high, for example the foreigner loan market, auto secured loans, and used passenger car loans in our capital business." The official added, "As the share of portfolios with relatively high delinquency rates increases, it seems there will be an effect of a slight increase in the NPL ratio next year."