South Korea’s internet bank said non-interest income, fee growth and sole proprietor lending helped offset tighter household loan rules as monthly active users topped 20 million for the first time.
KakaoBank reported its strongest-ever first half, with H1 2026 net profit rising 24.4% year on year to 328 billion won, as growth in non-interest income and sole proprietor lending helped cushion tighter aggregate household loan regulations. Second-quarter net profit increased 11.5% to 140.8 billion won and operating profit rose 14% to 194 billion won, while first-half operating revenue climbed 5.5% to 1.65 trillion won. The standout contribution came from non-interest income, which rose 4.8% to 589.5 billion won, or 36% of operating revenue. Fee and platform income advanced 10.5% to 169.6 billion won, supported by record quarterly check card payment volume of 6.3 trillion won and a 12% increase in loan comparison service execution volume. In the second quarter, gains on fund management reached 169.8 billion won as higher market rates boosted bond interest income. On the lending side, the bank said portfolio diversification continued despite constraints on household lending. Total loan balance at the end of Q2 reached 48.22 trillion won, up 518 billion won from the previous quarter. Household loans rose 234 billion won, while sole proprietor loans increased 284 billion won to 3.69 trillion won, accounting for about 48% of total net loan growth in the first half. KakaoBank also supplied about 1 trillion won in new loans to mid- and low-credit borrowers, while asset quality held steady with a delinquency rate of 0.51% and a non-performing loan (NPL, troubled loan) ratio of 0.54%. Customer growth remained strong. The bank ended Q2 with 27.63 million customers after adding about 1 million in the first half. Monthly active users reached 20.32 million for the first time and weekly active users rose to 15.04 million. Group Account users exceeded 13 million with balances of 11.7 trillion won. KakaoBank said upgrades to its Investment Tab, conversational AI services and newly launched foreign currency accounts helped bring in users and deepen engagement. Deposits fell 2.25 trillion won from the prior quarter to 67.11 trillion won by the end of Q2 as funds moved amid a strong stock market, though the bank said deposits returned to net inflows in July by more than 1 trillion won. Combined sales balances of MMF Box and funds reached 1.8 trillion won, underscoring its push to broaden its investment platform. In the second half, KakaoBank plans to roll out an auto finance comparison service in September, a check card linked to foreign currency accounts, and a stock trading service, or WTS (web trading system), with Kakao Pay Securities later this year. A refinancing service for sole proprietor customers with real estate-backed loans at other banks is due in the fourth quarter, while new PLCC cards (private label credit cards) are also planned. The bank said it is pursuing longer-term growth through the June push to acquire Maston Capital, expansion into capital business lending, overseas growth in Indonesia, Thailand and Mongolia, and a joint loan product with Busan Bank next year. A KakaoBank official said the bank would aim for 100 trillion won in assets by 2027 and a 15% return on equity (ROE, profit as a share of equity) by 2030.