KakaoBank Posts Record Profit on Strong Platform Growth

Philip Lee -

Seoul, South Korea—One of the country's major digital banks, KakaoBank (323410. KS), reported a 36.2% jump in third-quarter operating profit, driven by expansion in its fee and platform businesses as the digital bank continues to grow its active user base.

Source: Kakaobank

Operating profit rose to KRW 173.7 billion (US$125.1 million) in Q3 2024, up from KRW 127.5 billion a year earlier.

Net profit increased 30.2% to KRW 124.2 billion (US$89.4 million).

Key performance metrics:

  • Operating revenue grew 13.7% YoY to KRW 746.3 billion (US$537.5 million)
  • Weekly active users reached 13.52 million, up 1.18 million from the previous year
  • The total customer base expanded to 24.43 million, adding 1.59 million YTD
  • The cost-to-income ratio improved to 34.9% in September 2024 from 37.3% in 2023

The digital bank's loan comparison platform showed solid growth, with execution value surging 203% YoY to KRW 999.5 billion (US$719.8 million).

Asset Quality and International Expansion:

  • The delinquency rate remained stable at 0.48%
  • Credit cost ratio improved to 0.57%, down 26 basis points YoY
  • NPL coverage ratio strengthened to 235%

Indonesian subsidiary Superbank acquired over 2 million customers since the June launch

The bank's expansion into Southeast Asia gained traction, with its Indonesian operation showing rapid customer acquisition.

In September, KakaoBank joined a consortium with SCBX and WeBank to apply for a virtual banking license in Thailand.

KakaoBank maintained its position as Korea's leading digital bank, with the highest SOHO loan balance among digital banks.

The bank's low-cost deposit portion expanded to 57.9% compared to the industry average of 37.5%.

The company is focusing on strengthening its investment platform offerings and expanding ad revenue through new spaces and diversified billing methods.

The recent launch of its "Benefit Tab" feature in August 2024 has already achieved 22.3% user penetration among weekly active users.

ROE and ROA continued to improve, reaching 7.55% and 0.80%, respectively, as of September 2024, reflecting the bank's increasing profitability and operational efficiency.

(US$1 = KRW1,388.60)