South Korean banks posted the biggest quarterly profit in six years thanks to a one-off factor, financial watchdog data showed on Tuesday.
Net income of local commercial banks was 4.3 trillion won (3.8 billion U.S. dollars) in the January-March quarter, up 49 percent from a year earlier, according to the Financial Supervisory Service (FSS). It was higher than any first-quarter figures recorded in the past six years.
One-off factors led to the banks' earnings, including the South Korean currency's appreciation to the U.S. dollar that increased profits from foreign exchange-relevant derivatives.
Profits from bond and stock sales also contributed to the strong earnings.
Loss from loans to troubling shipbuilders and shipping firms reduced to 0.8 trillion won in the quarter compared with 1.8 trillion won a year earlier.
The government-led restructuring of major shipbuilders and shipping firms have been underway as lower profits and higher costs hit the industries amid the global economic slump and weaker trade.
Interest income, a main source of revenue for local banks, increased 4.3 percent, sending the net interest margin to 1.58 percent in the first quarter that was up 0.03 percentage points from a year ago.
The net interest margin, which tumbled to an all-time low in the third quarter of last year, rebounded for the two straight quarters.
Return on asset for banks rose 0.24 percentage points over the year to 0.76 percent in the first quarter. Return on equity advanced 2.97 percentage points to 9.71 percent.
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