Good morning, and good evening. Thank you all for joining this conference call. Now, we'll begin the conference of the fiscal year 2023, second quarter earnings results by KakaoBank. This conference will start with a presentation, followed by a divisional Q&A session. If you have a question, please press star 1, that is star and 1 on your phone during the Q&A. Now, we shall commence the presentation on the fiscal year 2023, second quarter earnings results by KakaoBank.
Hello, this is Diana Kang from KakaoBank's IR team. We will now begin KakaoBank's earnings call for the second quarter 2023. We are joined by members of management today, including our CEO, Yoon Ho-young, Vice President Jae Kim, Sean Kim, our Chief Operating Officer, Conrad Shin, our Chief Technology Officer, Vesper Guo, Chief Strategy Officer, Ira Lee, Chief Financial Officer, and Ellie Lee, Chief Risk Officer. The financial results contained in today's call are preliminary unaudited results based on K-IFRS, and may be subject to change upon review by an independent auditor. I will now hand over to Sean Kim, our COO, to present on our second quarter business highlights and financial results.
Good morning, this is Sean Kim from KakaoBank. Thanks to all of our investors and analysts joining us today for our second quarter 2023 earnings conference call. Let me take you through the key highlight results starting on page three. In 2023, KakaoBank has been moving forward under the goal of scaling up operating profits while strengthening the influence of our platform. In the second quarter, we posted operating profit of KRW 111.8 billion, driven by strong loan growth and stable asset quality. Our credit loan balance recorded KRW 33.9 trillion, up 16% quarter-over-quarter , driven by continued mortgage loan growth. Meanwhile, asset quality remained stable, with delinquency recording 0.52%, down six basis points versus Q1. The influence and power of our platform is becoming ever greater, driven by our solid customer base and increasing traffic.
Even now, with more than 20 million strong customers, we continue to see an inflow of new customers, with 1.32 million new users coming onto our platform in the first half of this year. Traffic is also gaining further momentum, with monthly active users now reaching 17.35 million in the 2nd quarter. On to page 4 for our customer base. As of the end of the 2nd quarter, customers totaled 21.74 million, with MAU of 17.35 million. Customers were evenly distributed across all age segments as we achieved growing presence, not only among the 20, 30-somethings, but among older users in their 40s and 50s, where we recorded increased penetration of 64% and 40% respectively. Our signature lineup of products, including group accounts, have been an efficient driver growing our customer base. Please refer to page 5 for more details on our Group Account products.
입니다.
Page 6.
KakaoBank는 차별화된 편의성과 높은 활용도를 바탕으로 고객과의 관계를 강화하고 있습니다. 고객들은 더 많은 돈을 넣어두고 KakaoBank를 더 가까이 해서 더 많이 사용하고 있습니다. 실제로 최근 3년간 인당 요구 계좌 잔액은 연 평균 14% 증가했고, 동일 기간 급여 계좌 고객수는 매년 32%씩 성장하였습니다. 이체 점유율 또한 리테일 뱅킹만으로 은행권 내 5위를 기록하며, KakaoBank 고객의 높은 활동성을 보여주고 있습니다. 이러한 관계의 강화는 자연스럽게 높은 리텐션으로 이어지고 있으며, 실제로 2023년 6월에 거래한 고객 중에서 직전 12개월 연속으로 거래한 고객의 비중이 69%까지 확대되며, 강화된 고객 기반을 확인할 수 있었습니다.
Based on the strength of our differentiated convenience and versatility of use, KakaoBank, we have been working to strengthen engagement with our customers further. As a result, we are seeing customers depositing more of their money with us, keeping us close by and using KakaoBank services more. Over the last 3 years, our current deposit balance has grown at a compound annual growth rate of 14% , with the number of payroll account users growing at 32% CAGR. We are now 5th in the banking sector in terms of market share based on bank transfers, just based on our retail banking business alone, which all demonstrate the high activity level of KakaoBank users and in turn, high level of retention as well. In fact, among all transacting customers in June, we have found that 69% have engaged in transactions on the KakaoBank platform for 12 months in a row, which is another strong indicator of our expansive user base.
7 페이지, 영업 수익입니다.
On to page 7 for operating revenue.
2분기 영업 수익은 전 사업 부문이 골고루 성장하면서 전분기 대비 구 퍼센트 증가한 육천백삼십삼억 원을 기록하였습니다. 여신 성장에 따라 이자 수익이 큰 폭으로 확대되었으며, 체크카드 실적 확대 등으로 fee 수익과 플랫폼 수익을 합산한 비이자 수익도 전분기 대비 사 퍼센트 성장하였습니다.
We posted second quarter operating revenue of KRW 613.03 billion , up 9% QoQ, with even growth across all business segments. Interest revenue increased significantly, driven by loan growth, while non-interest revenue, which combines fee and platform revenue, grew 4% QoQ, with debit card transactions a key growth driver.
8 페이지, 수신입니다.
On to page 8 for deposits.
2분기 수신 잔액은 전분기 대비 8% 성장한 KRW 43.6 trillion을 기록하였습니다. 저원가성 예금 비중은 전분기 대비 0.6 percentage points 개선된 57.4%를 기록하였는데, 이는 은행권 평균 대비 약 18 percentage points 높은 수준입니다. 2분기 자금조달 비용률은 지난 분기 유입된 예적금의 영향으로 전분기 대비 18 basis points 증가한 2.44%를 기록하였습니다.
Q2 deposit balance totaled KRW 43.6 trillion, up 8% from the first quarter. Low-cost deposits as a percentage of the total increased by 0.6 percentage points, recording 57.4%, which is about 18 percentage points higher than the banking sector average. Our funding cost increased by 18 basis points QoQ to record 2.44% from an increase in deposit balance inflow in the prior quarter.
다음은 9 페이지, 여신입니다.
Next on to loans on page 9.
2분기 여신 잔액은 전분기 대비 십육 퍼센트 성장한 삼십삼점구조 원을 기록하였습니다. 주택담보대출 잔액이 전분기 대비 이배 이상 증가하며, 여신 성장을 견인하였고, 전월세 대출 잔액 또한 반년 만에 순증 전환하며 이에 기여하였습니다. 신용대출은 일분기에 이어 이분기에도 순증하였으며, 이에 따라 이분기 중신용대출 비중은 전분기 대비 이점영 퍼센티지 포인트 증가한 이십칠점칠 퍼센트를 기록하였습니다. 한편, 이분기 NIM은 수신 확대 및 자금조달 비용률 증가 등으로 전분기 대비 삼십육 베이시스 포인트 하락한 이점이륙 퍼센트를 기록하였습니다.
As of the second quarter, our loan balance totaled KRW 33.9 trillion, up 16% from the previous quarter. Our growing mortgage loan balance, which increased by more than double versus Q1, was the single largest driver for lending growth. Housing deposit loans also contributed to growth, with the balance turning around to a net increase for the first time in 6 months. Credit loans continued to record a net increase in Q2, as it did in Q1, with the share of mid-credit loans increasing to 27.7% against total credit loans, up 2 percentage points QoQ. Net interest margin in the second quarter was 2.26%, down 36 basis points QoQ from deposit growth and higher funding costs.
다음 페이지에서는 주택담보대출 실적에 대해 자세히 설명드리겠습니다.
Next, moving on to the next page for details on our mortgage loan performance.
10 페이지입니다.
Page ten.
KakaoBank 주택담보대출은 2Q 말 잔액 KRW 5.5 trillion을 돌파하며 높은 성장세를 보이고 있습니다. 편리한 사용 경험과 금리 경쟁력에 힘입어 2Q 취급액의 60%를 차지한 대환 수요를 중심으로 신규 취급액이 매 분기 two times 이상 증가하였으며, 신규 취급액 기준 은행권 내 점유율은 7.2%까지 확대되었습니다.
As of the end of Q2, KakaoBank's mortgage loan balance exceeded KRW 5.5 trillion, demonstrating strong growth thanks to convenient user experience and competitive rates, with new loans increasing by more than double every quarter, driven in particular by growth in new mortgage loans for refinancing purposes, which make up 60% of the new balance in Q2. Thanks to this strong performance, our market share in new loans within the banking sector was boosted to 7.1%.
한편, KakaoBank 주택담보대출 고객의 56%는 40대 이상으로, 해당 연령대의 평균 요금을 계좌 잔액은 전체 고객 평균 대비 3배 가까이 높은 모습을 보이고 있습니다. 주택담보대출의 성장으로 KakaoBank의 수신 경쟁력 또한 더욱 강화될 것으로 기대됩니다.
At present, 56% of our mortgage loan users are aged 40 and above, who on average have a current deposit balance nearly 3 times larger than the overall average for all aged users. We believe that our mortgage loan growth will in turn help strengthen the competitiveness of our deposit products.
11 페이지부터는 fee 및 플랫폼 비즈니스에 대해 신규 서비스 위주로 말씀드리겠습니다.
From page 11, let's move on to our fee and platform business side. I will be mostly highlighting new services.
11 페이지, 대출 플랫폼입니다.
First, our refinancing platform on page 11.
카카오뱅크는 대출 이동제 시드- 시행에 따라 지난 오 월 신용대출 갈아타기 서비스를 출시하였습니다. 연간 중신용대출 비중 목표를 고려하여 고신용 고객에 대한 유량 제어를 진행했음에도 불구하고, 유월 전체 금융권 내 시장 점유율은 십점오 퍼센트를 기록하였으며, 유량 제어가 없는 기간에는 시장 점유율이 오십 퍼센트를 초과하는 등 카카오뱅크 상품의 영향력을 확인할 수 있었습니다. 연내 대출 비교 서비스 출시를 통해 서비스 영역이 더욱 확대된다면, 더 많은 고객들이 사용하는 대출 플랫폼으로 자리잡을 수 있을 것이라 기대됩니다.
With the start of the loan refinancing initiative in Korea, we launched our new credit loan refinancing service earlier this May. Although we set a daily limit on applications by high credit borrowers, as we were mindful of meeting our annual mid-credit targets , we still recorded high market share of 10.5% within the broad financial industry in June. With market share shooting up to above 50% during periods when inflow limits were not in place, which reaffirmed the influential power of our KakaoBank offering. We're planning to introduce a loan comparison service within the year and expect to be firmly anchored as a refinancing platform of choice by more customers as we continue to scale our service domain.
12 페이지입니다. 지급 결제 관련 상세 실적은 해당 페이지를 참고해 주시기 바랍니다.
Page 12, please refer to the slide for details on our payment services.
다음은 13 페이지, 투자 맥락입니다.
Moving on to page 13 for our investment context.
카카오뱅크는 고객의 투자 활동에 필요한 서비스들을 순차적으로 출시하며 투자 맥락을 강화하고 있습니다. 지난해까지는 증권 계좌 개설, 국내외 주식 매매 서비스 등 주식 투자의 커버리지를 완성하는 데 집중했다면, 올해 유월에는 발행어음 판매를 시작하여 주식 외 영역으로 서비스를 확장하였습니다. 앞으로 제휴사 및 투자 상품군을 지속 확대하여 카카오뱅크 고객들의 투자 경험을 더욱 풍성하게 하고자 합니다.
At KakaoBank, we have been sequentially launching a series of investment related services to build up our presence in the investment context. Whereas we focused on completing our offerings, mostly to support equity investments, for example, securities account openings or global and local stock trading services up to last year. In June, we started expanding into the non-equity stock trading space with commercial paper sales as a start. Going forward, we want to expand our partnerships and lineup of investment products further to provide a richer investment experience to all KakaoBank users.
14 페이지, 광고 비즈입니다.
Page 14, our advertising business.
광고 비즈는 통신, 전자, 커머스 등 다양한 광고 카테고리 확보 및 지면 확대를 통해 상반기 매출 KRW 4.3 billion을 기록하였습니다. 매출의 약 70%는 대출 광고를 비롯한 KakaoBank 자체 광고 상품으로 사업 초기임에도 불구하고, 플랫폼 경쟁력을 확인할 수 있었습니다. 하반기에는 광고 효율을 더욱 높일 수 있도록 추천 모형 고도화 등을 통해 경쟁력 강화에 집중하고자 합니다.
Our ad business recorded KRW 4.3 billion in sales in the first half, thanks to expansion of ad categories, including telecommunications, electronics, and commerce, and also inventory expansion as well. Although we are still at the very early stage of the advertising business, about 70% of total ad sales came from our own direct contract ads, such as loan ads, reaffirming the competitiveness of our platform, which we want to build on further in the second half of the year by further advancing our ad recommendation model for greater advertisement efficiency. Page 15, mini. Next, on to mini on page 15.
10대들의 금융 필수 앱으로 자리잡은 mini는 지난 5월, mini Life 론칭을 통해 10대들의 일상생활로 영역을 확장했습니다. 이제 학생들은 금융 거래뿐만 아니라 학교 시간표나 점심 메뉴 확인을 위해 mini에 접속하고 더 많은 시간을 함께합니다.
Mini has become a must-have financial service app for local teens, and with the added launch of Mini Life in May, has expanded into the daily life territory of our teen users even more. Now, users are spending more time logged on to Mini than ever before, not only for their financial needs, but for everyday tasks, such as checking their class schedules or their school lunch menus.
실제로 mini Life에 가입한 고객의 96%는 매주 앱에 방문하고 있으며, 평균 로그인 횟수는 10회를 기록하는 등 mini에 가입하지 않은 고객 대비 높은 활동성을 보이고 있습니다. 앞으로도 금융과 생활을 지속적으로 접목하여, 대표 금융 생활 서비스로 자리 잡고자 합니다.
In fact, 96% of Mini Life subscribers are now visiting the app every single week, with login frequency averaging 10 times per week, displaying a higher activity level versus non-Mini users. We will continue to add on other, converged offerings, to further establish our service as the go-to service for both finance and daily lifestyle needs.
mini 대한 추가적인 내용은 16 페이지를 참고해 주시기 바랍니다. 17 페이지 SG&A와 CIR에 대해 말씀드리겠습니다.
Excuse me. Please refer to page 16 for further details on Mini. Now moving on to SG&A and CIR on page 17 .
17 페이지입니다.
Okay, page 17.
이 분기 판관비는 사대 보험료 정산 효과 및 신규 상품 서비스에 대한 광고 선전비 증가 등으로 전분기 대비 16% 증가한 KRW 107.3 billion을 기록하였으며, CIR은 39%를 기록하였습니다.
SG&A in the second quarter recorded KRW 107.3 billion, up 16% QoQ, reflecting full payment of premium into the four major public insurance schemes, and also increased advertisement and promotion spend for new products. CIR was 39%.
18 페이지 영업이익입니다.
On to page 18 for operating profit.
이 분기 영업이익은 여신 성장에 따라 이자이익 규모가 확대되며, 전년 동기 대비 50% 증가한 KRW 111.8 billion을 기록하였으며, ROE와 ROA는 각각 5.62%, 0.67%를 기록하였습니다.
Our second quarter operating profit recorded KRW 111.8 billion, up 50% year-on-year, driven by an increase in interest income from loan growth. ROE and ROA recorded 5.62% and 0.67% respectively.
19 페이지 자산 건전성입니다.
On to page 19 for asset soundness.
이 분기 연체율은 전분기 대비 육 베이시스 포인트 하락한 영 점 오이 퍼센트를 기록했습니다. 주택담보대출을 중심으로 대출 자산이 크게 확대되었으며, 일 분기 연체 잔액의 상당 부분을 차지했던 보증부 대출에 대한 대위변제 절차가 진행되면서 연체율 하락에 기여하였습니다. 고정 이하 여신 비율과 대손 비용률도 전분기 대비 소폭 개선되며 각각 영 점 사이 퍼센트, 영 점 칠오 퍼센트를 기록하였고, 대손 충당금 적립률은 이백이십구 퍼센트를 기록하였습니다.
The delinquency rate we recorded in the second quarter actually was 0.52%, which was down 6 basis points from the previous quarter. We did see a big increase in loan assets, driven mostly by mortgage loans. But we initiated re-subrogation payment proceedings on guaranteed loans, which actually made up the biggest part of our overdue balance in the first quarter. As we seek repayment of the claims from the guarantor on behalf of the borrower, this contributed to a decline in the delinquency rate. Our sub standard and below rate, also credit costs, saw a slight improvement versus the previous quarter, recording 0.42% and 0.75%, respectively. Our loan loss allowance coverage ratio also was 229%.
20 페이지부터 22 페이지까지는 신규 서비스 계획과 글로벌 사업 전략, 그리고 ESG 주요 성과에 대한 설명으로 상세 내용은 각 페이지를 참고해 주시기 바랍니다.
From pages 20 to 22, I think you can refer to the slide for our planned new service launches and our global business strategy. Also, key highlights in terms of ESG performance as well.
이상으로 2023년 2분기 주요 사업 성과와 재무실적에 대한 설명을 마치도록 하겠습니다.
With that, I will conclude my presentation on the key business highlights and financial results for the second quarter of 2023.
이어서 Q&A 세션을 진행하겠습니다. 시간이 제한되어 있사오니 한 분당 질문은 두 개 이내로 해주시기를 부탁드립니다.
We will now move straight to Q&A. Because of the limited time, we appreciate if you would limit yourself to two questions each.
지금부터 질의응답을 시작하겠습니다. 질문을 하실 분은 전화기 버튼의 별표와 일번을 눌러주시기 바랍니다. 질문을 취소하시려면 별표와 이번을 눌러주시면 됩니다. 원활한 회의 진행을 위하여 질문은 한 분당 두 가지 이내로 부탁드립니다. Now, Q&A session will begin. Please press star one, that is star and one, if you have any questions. Questions will be taken according to the order you have pressed the number star one. For cancellation, please press star two, that is star and two on your phone. In order to allow as many Q&A chances as possible within the restricted time, we would appreciate only two questions for each participant. 처음으로 질문해 주실 분은 골드만삭스 증권의 박신영 님입니다. The first question will be provided by Sinyoung Park from Goldman Sachs. Please go ahead with your question.
네, 안녕하세요. Goldman Sachs의 Sinyoung Park입니다. 두 가지 질문. 아무래도 첫 번째는 대출 성장인 것 같습니다. 올해 들어서 이제 주담대 부문에서 뚜렷한 과석화가 이루어지고 있고, 사실 연초에 주신 10% 중반대 성장 타겟을 이미 초과 달성을 해버리셔서, 올해 그 가이던스의 재조정이 좀 필요해 보이거든요. 올해 전체 성장, 특히 주담대에 있어서 어떻게 전망하고 계신지 두 분 말씀 부탁드립니다. 두 번째는 마진 관련인데요. 저희가 신규 대출에서 주담대 비중이 높기도 했지만, 시장에서 예상했던 것보다 훨씬 더 큰 폭의 마진 축소가 있었던 것 같습니다. 또 저희가 연초에 예금을 좀 많이 확보해 두기는 했지만, 현재 성장 속도를 감안하면 좀 향후에 funding cost에도 부담이 생길 수 있을 것 같은데, 앞으로 이런 funding 부분 혹은 마진에 있어서의 관리 계획이라든지, 전망 공유 부탁드립니다. 감사합니다.
Yes, thank you very much. This is Sinyoung from Goldman Sachs. I have two questions. First, on your loan growth, I think into the start of this year, you did see very high rates of lending growth, especially around your mortgage loans. You've in fact, over even, you know, overachieved against your start of the year target at mid 10% or so. Perhaps your full year guidance in terms of loan growth may need an adjustment. Could you provide that kind of adjusted guidance in terms of how much loan growth, especially for your mortgage loans, you expect for 2023 on a full year revised basis? Second question regarding margins. As a percentage of all new loans, the percentage of mortgage loans actually was quite high.
Even that said, I think the margins actually have contracted by more than was expected by the market generally. You did secure a lot of deposits funding early in the year, but still, considering the speed of lending growth, do you think potentially there may be some burden weighing on your funding costs? Could you provide us with some, you know, plans, or your outlook in terms of how you will be managing your funding costs and margins? Yes, thank you for what I think will be the two questions that everybody is most interested in.
Yes, your first question regarding our guidance for loan growth. As you have seen, in the first half of this year, KakaoBank has really by far overachieved against our initial guidance or target. At present, we believe that for full year 2023, we may be on good track to achieve mid 30% level of lending growth. Yeah. As we explained at the last first quarter conference call, we actually did expect a high level of loan growth starting in the first quarter this year. Relative to the increase we saw in deposits, the loan growth in Q1 was actually below our expectations. However, into the second quarter, the market started to move in line with our broad expectations. We think that obviously we may have to look to adjust the loan-to-deposit ratio, and also this may be the timing where we start focusing more on how to manage both our deposit and lending rates.
As we continue to grow our loan book, assuming that there are adjustments made to the rates, both on the deposit and lending side, whereas we achieved full year NIM somewhere around 2.48% last year, we think that based on current projections, we may be set to achieve somewhere between 2.35%-2.4% NIM this year. Of course, this may be subject to various uncertainties, including market interest rates, also the directionality of the government policy. However, because a lot of the assumptions that have been in place by KakaoBank for the first half of the year have largely played out, we think that that level of NIM or margins should be largely achievable in the second half of this year. Next question, please.
The following question will be presented by Park Hye-jin from Daishin Securities. Please go ahead with your question.
Yeah, 안녕하세요, 질문기회 주셔서 감사합니다. 그 저도 마진 관련해서 좀 질문을 드리고 싶은데, 말씀해 주시는 걸 보면 이제 좀 NIM 하락을 감수하면서 좀 성장을 크게 이끌어 가시는 것 같습니다. 그냥 올해 하반기뿐만 아니라 좀 중기적으로 저희가 혹시 뭐 관리 가능 수준이나 혹은 이제 타겟팅 하고 있는 NIM 수준이 있는지 공유해 주시면 감사할 것 같고요. 두 번째는 조금 마이너한 질문일 수 있는데, 이제 저희가 여신 성장이 너무 잘 나오다 보니까, 이번에 전세자금 대출에서 저희가 한도를 좀 확대한 걸로 알고 있어요. 확대를 했어도 그 수준이 그렇게 높은 건 아니어서, 뭐, 하반기나 이런 있은 시기에 그 전세 대출 한도를 좀 높이실 계획이 있는지, 공유 부탁드리면 감사하겠습니다.
Yeah, thank you for letting me ask two questions. My question also has to do with margins. It seems from what I'm hearing that you are ready to accept a little bit of a decline in NIM, in order to really boost or scale up growth. As we look not only out to the second half of this year, but more into the, into longer term, do you have a certain target in mind in terms of NIM? What level of NIM will be manageable again, if you could share, I would appreciate it. Second question is more minor. Your loan growth to date has been very solid. I understand for your housing deposit loans, you have increased the limit slightly, but it was not sizable. In the second half, do you have any plans to further increase the limit on your housing deposit loans?
It's not that we have a specific mid to long-term NIM target in mind that is reflected in the business plan. We do actually refer to the lending deposit rate spread, which is data made available by the Banking Federation on their website, where you can access the information by the different banks, their lending rate versus deposit rate, and in turn, the spread that I mentioned. We do refer to the spread as key information in determining our deposit and lending rates at an optimal level. Yes. A key piece of information that is not visible or accessible is the amount of loan loss provisioning that is set aside by loan type.
We look at not only the rate spread between loans and deposits, but also how much provisioning has to be set aside in the process of originating a loan to protect against loan loss. We refer to both indicators because we consider to be a key priority to use that information to determine an optimal level of lending and deposit rate spread to carry a stable buffer. Obviously we are a latecomer to the industry, as we launched new services and products, including our home mortgage loans, we believe that as a newcomer, in order to build up very quick presence and dominance in the space, we would intentionally have to come up with very competitive rates.
I think this kind of strategic approach actually paid off, because now very many users and also, people in the market for loans think of the KakaoBank and also our refinancing loans first to mind when they consider getting a loan. If you look at the percentage of refinancing loans, against our total mortgage loan balance, I think that also is an indicator showing that our strategic approach was in fact, very effective and valid. Regarding your second question regarding the housing deposit loan, actually, we launched a new housing deposit loan in July this year, which is actually guaranteed by SGI, which is Seoul Guarantee Insurance Corporation.
Compared to the regular housing deposit loans that we had previously made available, this loan actually provides more attractive conditions for the borrower. The limitations on the deposit amount limit, for example, has been eased from KRW 220 million or so up to KRW 500 million. I think we should assess the reaction or the response from the market or the users on this product first.
The following question will be presented by Jihyun Cho from JP Morgan. Please go ahead with your question.
Yes. I have a question on asset soundness. As you saw a very rapid increase in your loans, it seems that compared to the start of the year, your delinquency ratio NPL actually has stabilized considerably. Could you share those metrics and trends for other types of loans, your mid to low rate loans, for example, or other credit loans? I think the other competing banks actually have enforced more conservative provisioning policies in the second quarter, even, you know, changing their underlying assumptions to do that. Have you done that in the second quarter, in terms of, you know, more conservative provisioning done in Q2 versus Q1? Second, question, you said that you're looking at mid-30% level loan growth as guidance for this year.
Since you've already achieved 20% growth in the first half of the year, what does that mean in terms of the trajectory for further growth? Is the second quarter or second half of the year, you know, on a quarter-to-quarter basis, are you thinking single-digit growth, or do you think that it was particularly high in the second quarter? Do you think it's likely to slow down, or do you have more of a conservative outlook? Could you share more of your outlook for the second half?
Yes. In terms of asset soundness, we do have delinquency data available for the broad market, current as of the end of May, which we can refer to. For the overall market, the delinquency rate for overall loan portfolio, including credit loans, is 0.75%. In the same time period for KakaoBank, for our credit loan and other loan portfolio, our delinquency rate is 4 basis points lower at 0.71%. So when you consider that the portion of mid to low credit borrowers is above 27%, I think that we can consider this as a key indicator showing very robust asset quality management, specifically of our credit loans.
But as we also commented at the last conference call, credit loans ultimately are impacted by the level of market interest rates and also directly impacted by the business cycle as well. That said, we think looking at the second half of the year, we think that there still remains potential upside for growth of credit loans in the second half. Perhaps, we should see a turnaround toward growth at the earlier end, perhaps starting in the first half of next year, or perhaps by more stable trends by June or July next year. That is our internal view at the moment.
충당금과 관련해서는 감독기관을 중심으로, 보수적인 적립 기조에 대한 논의가 활발히 이루어졌다라고 이해하고 있습니다. KakaoBank는 이미 이러한 논의와 별개로, 저희가 미래 경기 전망이라는 framework을 통해서 충분한 수준의 충당금을 적립하고자 노력을 하고 있었고, 상반기에는 리스크 측정 요소를 보수적으로 추정해서 추가적으로 over KRW 14 billion 충당금을 적립했기 때문에, 하반기이의 경우에는, 이러한 리스크 측정 요소의 논의가, 감독기관을 중심으로 어떻게 진행되는지에 따라서, 추가 적립 여부가 결정이 된다라고 판단을 하고 있습니다.
Your second question regarding provisioning. We do understand that there are discussions, centered around the regulatory authorities about introducing a more conservative stance toward provisioning overall. Separate and independent from those discussions, internally at KakaoBank, we have already been enforcing more conservative provisioning already based on what we call future business outlook framework. We have already set aside a sufficient level of provisioning through efforts. In fact, in the first half of the year, we did additional provisioning of KRW 14 billion based on very conservative assessment of various risk assessment factors. In the second half of the year, it does, depend on, how, what kind of discussions take place on those risk factors, led by the regulatory authorities, that will ultimately determine whether or how much additional provisioning, would be required.
마지막으로 주신, 대출 성장 연간 가이던스와 관련해서는, 저희가 말씀드린 것처럼, 최소 30% 중반이라고 말씀을 드렸고요. 이는, 상반기에 비해서 다소 보수적인 하반기 성장을, 예상하는 것인데요. 그 이유는 첫째는 말씀드린 것처럼 여전히 현재의 경기 상황은, 또 시장 금리 상황은, 굉장한 불확실성을 담고 있어서, 신용대출을 중심으로 한 대출 포트폴리오의 건전성 관리가 굉장히, 중요하다라고 여전히 판단하고 있다라는 점이 하나 있고. 저희는, 상대적으로 마진 폭이 작은, 주택담보대출과 같은, 상품을 중점적으로 취급을 해야 되는 상황인데, 은행연합회에서 공시 기준이 바뀌어서 더 이상 이제 신규 취급 기준이 아닌 잔액 기준으로의, 공시가 추가적으로 진행이 되고 있습니다.
그러다 보면 각 은행들 간의 금리 경쟁이 더 치열해질 거라고 저희가 판단을 하고 있어서, 저희는 하반기에는 대출 성장이라는 물량보다는 상대적으로는 NIM 관리라든가, 이런 그 수익률 관리가 좀 더 상반기에 비해서는 필요하다라고 판단을 하고 있었기 때문에, 조금은 보수적이지만 상반기보다는 좀 더 작은 성장을 예상을 해서 전체적으로는 mid-30% 정도는 달성할 수 있을 것 같다, 요 정도는 시장과 커뮤니케이션 할 수 있겠다, 이렇게 판단을 한 것입니다.
Yeah. Regarding our full year guidance for loan growth 2023, as I said, we're talking about minimum mid 30% growth this year. Relative to the first half of the year, we are slightly more conservative in terms of our outlook or prospects for loan growth in the second half. The reason being, various uncertainties that remain in place in terms of the current business cycle, also the directionality of the market rates also is uncertain. We think that going forward, that means that managing asset quality, particularly for our credit loans, will become, will remain a very key priority into the second half of the year.
Overall, we think that we may have to place more focus on the lower margin, home mortgage type loans, again, lower margins in relative sense, of course. We are mindful that there are ongoing discussions at the banking federation level within the, among the commercial banks about changing the criteria for disclosure filing from new origination amounts to existing balance. It's depending on how those discussions play out, if it is effected, we think that that can actually spark even more pricing competition over lending rates in the second half of the year.
Which is why, compared to the first half, we think that in the second half, we should focus not so much on building up the volume per se, but focus more on better managing our profitability and also our NIM rates. Again, yes, again, compared to the first half, we are more conservative in terms of how much growth we expect in the second half of the year, expecting slightly less growth. On balance, we think that we will at minimum be able to achieve not 30%, but let me correct myself, 35%, minimum growth.
The following question will be presented by Jae Woong Won from HSBC . Please go ahead with your question.
아, 네, 안녕하세요. 어려운 상황에서도 좋은 실적 내주셔서 감사합니다. 그 두 가지 여쭤볼 게 있는데요. 첫 번째는 그 저희가 보면은 기타 영업수익이 좀 작년 대비해서 많이 빠르게 증가하는 걸 봤습니다. 혹시 여기에 그 아까 말씀하신 광고 수익이 들어가는지, 아니면은 유가증권 관련된 이런 수익들이 좀 들어가는지, 그 부분을 좀 자세히 설명해 주셨으면 될 것 같고요. 두 번째는 그 충당금 아까 질문 나왔었는데, 선제적으로 이제 잘 쌓고 있다 말씀해 주셨는데, 혹시 이번 분기에는 저희가 선제적으로 쌓은 충당금이 혹시 있으신지? 이제 저희는 좀 다르게 미래 경기 대응해서, 정부에서 충당금 쌓으라는 그런 요구들이 크지 않은지, 그런 것 좀 설명해 주시면 감사할 것 같습니다.
Yes, thank you for delivering good performance despite the difficult circumstances and conditions. I have, my first question has to do with your other operating profits, which seems to have grown significantly, very quickly compared to last year. Does that number include your advertisement revenue as well? Other incomes from your marketable securities, for example, if you could provide more details, I'd appreciate it. Second question regarding provisioning. I think you're saying that, in relative sense, you have been very good about setting aside good provisioning already. Specific to the second quarter, how much preemptive provisioning have you done in Q2? What are your expectations in terms of what the government will require in terms of, you know, future countercyclical type of provisioning requirements?
첫 번째 질문에 대해서 말씀드리겠습니다.
Yes, regarding your first question.
기타 수익에는, 세 가지가 들어가 있는데요. 첫째는 MMF와 수익 증권과 같은 투자 유가증권의, 매매나 평가 수익이 들어가 있습니다.
Yes. Actually, there are three components making up other revenue. First is regarding the marketable investment securities. We have gain or loss on trading or valuation, so that component will include gains or losses from MMF or beneficiary certificate type products.
나머지 두 개는, NPL과 같은 부실자산을 매각했을 때 생기는 대출 채권 매각 이익과 저희 외환 비즈니스에서 발생하는 외환 거래 이익, 두 가지입니다.
The second component is our disposal gains from disposition of NPL. Third is our fee from Forex transactions.
질문하신 것처럼, 광고 수익의 경우에는, 기타 수익에 들어가 있는 게 아니라, 플랫폼 수익으로 저희가 포함을 해서, 실적 보고를 드렸습니다.
Advertising revenue, which you asked about, is actually accounted for not under other revenue, but it goes under platform revenue, which is indicated in our performance materials.
조금 더 추가해서 설명을 드리자면, 기타 수익의 대부분을 차지하는 것은, MMF에 대한 매매 및 평가 수익입니다.
To explain a little bit more, the biggest part making up other revenue actually is trading or valuation gain or loss from MMF.
이는 시중은행과 달리 예대율이 다소 낮게 관리되고 있는 KakaoBank의 경우에, 대출로 운영되지 않은 나머지 수신액을, 이런 단기 투자 유가증권에, 투자를 해서 저희가 수익을 내고 있는 것인데요. 특히 MMF 투자 금액이, 1Q에 대비해서도 2Q에 더 증가를 했는데, 이는 기본적으로 시장 금리 상황이, 국고채 금리가, 기준금리보다도 낮게 유지가 되어서, 오히려 단기 투자 유가증권의, 수익률이 좋아서, 결과적으로 이어진 내용입니다.
In contrast with other commercial banks, actually, we at KakaoBank have a slightly lower loan to deposit ratio. What funding we use, the funding that we have available after providing lending, we actually can invest in investment products or other marketable securities, like MMF. It so happens that compared to the first quarter, we actually saw very good returns on our investments into products, including MMF, in the second quarter. In fact, because the treasury bond yields are in fact even lower versus the benchmark yield, we've actually seen very strong yield and returns from our short-term investments into these instruments.
두 번째 질문하신 충당금과 관련해서는, 분기별로 비중을 두어서 설명을 드리자면, 저희가 추가적으로 선제적으로 적립한 충당금의 규모가 KRW 13 billion-KRW 14 billion 정도였는데요. 1Q에 KRW 9 billion 조금 초과하는 수준, 2Q에 KRW 4.3 billion 정도, 이런 비중이었습니다.
In terms of, the KRW 13 billion-KRW 14 billion in preemptive provisioning that we have already set aside in the first half of the year, let me break it down, into Q1 and Q2. It was slightly over KRW 9 billion, in Q1 and KRW 4.3 billion in Q2.
감독기관에서 진행하고 계시는 리스크 특정 요소 중에, 과거까지의 논의가 주로 PD라는 부도율을 중심으로 한 논의였다면, 지금은 기존에 커버하지 않았던 LGD와 같은 부도시 손실액과 관련한 추가적인 측정 요소에 대한 논의가 진행되는 것으로 알고 있습니다. 이 논의 결과에 따라서 추가 충당금 적립 여부가 결정되어 있는 것이라서 현재로서는 저희가 예단하기는 어렵습니다.
In terms of the risk assessment factors that the regulatory authorities enforce, in the past, most of the discussions were focused around probability of default or PD rates. Now, there are ongoing discussions about introducing additional assessment criteria, like loss given default, LGD. It does depend on how those discussions play out, and they will. We'll have to see how they finalize to determine whether additional provisioning will be required or not. It is hard to say definitively at this present time.
다음 질문 받겠습니다.
다음으로 질문해 주실 분은 한화투자증권의 김도하님입니다. The following question will be presented by Sohye Kim from Hanwha Investment & Securities. Please go ahead with your question.
For giving the opportunity, but in fact, the, the, investor or analyst just now actually asked the two questions that I was going to. I will pass. Thank you.
예, 추가적인 질문이 없으시면 이상으로 KakaoBank의 2023년 2Q 실적 발표를 마치겠습니다. 오늘 시간 내어 참석해 주신 애널리스트 투자자분들께 다시 한번 감사드립니다.
If there are no further questions, we will now conclude our conference call for KakaoBank in the second quarter of 2023. I'd like to end by thanking all of our analysts and investors for joining us today.