Interest income at South Korean banks topped 60 trillion won for the first time, and net profit also hit a record high.

According to the Financial Supervisory Service's preliminary 2025 results for domestic banks released on Wednesday, banks' net profit last year came to 24.1 trillion won, up 1.9 trillion won, or 8.2 percent, from 22.2 trillion won a year earlier.

By category, interest income rose to 60.4 trillion won, surpassing 60 trillion won for the first time. That was up 1.1 trillion won, or 1.8 percent, from a year earlier.

Net interest margin fell 0.06 percentage points from a year earlier. The increase in interest-earning assets that generate loan interest income offset the decline, the data showed, with such assets rising 151.8 trillion won, or 4.6 percent, to 3,442 trillion won.

Non-interest income rose 1.6 trillion won, or 26.9 percent, to 7.6 trillion won. In particular, foreign exchange and derivatives-related gains surged to 6.2 trillion won from 400.0 billion won a year earlier, up 5.8 trillion won, or 1,295 percent.

Financial authorities explained that securities-related gains fell by 3.3 trillion won due to greater interest rate and exchange rate volatility, including rising Korean Treasury bond yields. They said a similar-sized gain from derivatives hedging to defend against that decline contributed to the result.

On the cost side, selling and administrative expenses rose 2.0 trillion won, or 7.2 percent, from 27.4 trillion won to 29.4 trillion won, reflecting higher labor and other expenses.

Credit loss provisions were tallied at 6.5 trillion won, down 400.0 billion won, or 5.9 percent, from 7.0 trillion won a year earlier.

Return on assets, a profitability indicator, held at a similar level at 0.59 percent versus 0.58 percent a year earlier, and return on equity rose 0.17 percentage points over the same period to 7.93 percent.

The regulator said uncertainties at home and abroad and concerns about credit losses are increasing due to Middle East risks, U.S. tariff policy and greater interest rate and exchange rate volatility. It said it would steer banks to intermediate funds in a stable manner even if economic conditions worsen.