KOSPIFinance323410

KakaoBank

₩19,740▼ 0.10%2026-10-02 close

Market Cap

₩9.4T

Turnover

₩12.3B

Volume

630,000 shares

Shares out.

480M

PER

19.2×

PBR

1.6×

EPS

₩1,143

Dividend Yield

2.10%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩460 per share · Prices as of the 2026-10-02 close

Report overview

Growth Axis Widening: Platform and Capital Finance

Despite household lending curbs, earnings momentum has been sustained through sole-proprietor loans and non-interest income, while the company tests growth engines outside banking via a capital-finance acquisition and Asian equity investments.

1
In 2025 operating revenue reached KRW 3,086.3bn, operating profit KRW 649.4bn and net profit attributable to owners KRW 480.3bn, extending the upward direction seen since 2022, with an operating margin of 21.0%.
2
Second-quarter 2026 operating revenue of KRW 829.0bn and operating profit of KRW 194.0bn were the highest within the period shown, and the quarterly net interest margin rose 13bp from the prior quarter to 2.13%, as higher market rates and expanded unsecured lending lifted asset yields.
3
First-quarter 2026 net profit of KRW 187.3bn exceeded operating profit of KRW 157.6bn; Kyobo Securities noted a one-off valuation gain booked as non-operating income following an accounting change related to Indonesia's Superbank.
4
The board approved acquiring 100% of Mastern Capital (5m shares) for KRW 24.1bn, and on the Q2 call management outlined roughly KRW 150bn of capital injections in two tranches, an FSC approval target within 2026 and a new service launch in the first half of 2027.
5
With regulators setting this year's household loan growth target at around 1.5%, second-quarter household loan growth was only KRW 234bn and total loans rose KRW 518bn to KRW 48.2tn.

Business structure

KakaoBank is a branchless internet-only bank offering deposits, loans and platform services through mobile. Customers totaled 27.63m at end-Q2 2026 after roughly 1m net additions in the first half, with monthly active users of 20.32m and weekly active users of 15.04m.

Revenue rests on three pillars: loan interest income, treasury and securities gains, and fee and platform income; first-half non-interest income was KRW 589.5bn, or 36% of total operating revenue.

Platform income was composed of loan comparison at 34%, the securities business at 31%, advertising at 25% and mini accounts and card referral at 10%, with advertising up 81% year on year on expanded premium placements, lifting its share of platform income from 19% to 31%.

On funding, low-cost deposits were 56.7% of the base at end-June versus a banking-sector average of 39.5%, and the quarterly funding cost ratio fell to 1.82%.

The loan book is shifting from households toward small business owners: sole-proprietor loans stood at KRW 3.69tn at end-Q2 and accounted for 48% of first-half net loan growth.

Competition is a three-way internet-bank field: first-half net profit was KRW 328bn at KakaoBank and KRW 60.1bn at K bank, while Toss Bank posted KRW 29.6bn in Q1. In June the company signed a share purchase agreement for 100% of Mastern Capital to enter the capital-finance market. Overseas, partnerships span Indonesia's Superbank, a Thai virtual bank and Mongolia's M Bank.

Earnings trend

Quarterly revenue · Operating profit

₩778B₩170.1B25Q2₩764.7B₩151.1B25Q3₩759B₩145.1B25Q4₩819.3B₩157.6B26Q1₩829B₩194B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩1.6T₩353.2B2022₩2.5T₩478.5B2023₩2.9T₩606.9B2024₩3.1T₩649.4B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩778B	₩170.1B	21.9%
2025Q3	₩764.7B	₩151.1B	19.8%
2025Q4	₩759B	₩145.1B	19.1%
2026Q1	₩819.3B	₩157.6B	19.2%
2026Q2	₩829B	₩194B	23.4%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩1.6T	₩353.2B	₩263.1B	22.0%	4.6%	591.4%
2023	₩2.5T	₩478.5B	₩354.9B	19.2%	5.8%	790.7%
2024	₩2.9T	₩606.9B	₩440.1B	20.6%	6.7%	860.3%
2025	₩3.1T	₩649.4B	₩480.3B	21.0%	7.1%	1032.0%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

Earnings analysis

For 2025, operating revenue was KRW 3,086.3bn, operating profit KRW 649.4bn and net profit attributable to owners KRW 480.3bn, all higher than 2024 (KRW 2,945.6bn, KRW 606.9bn, KRW 440.1bn).

Set against 2023 (KRW 2,494.0bn, KRW 478.5bn, KRW 354.9bn) and 2022 (KRW 1,605.8bn, KRW 353.2bn, KRW 263.1bn), operating revenue nearly doubled over three years. The operating margin slipped from 22.0% in 2022 to 19.2% in 2023 before recovering to 20.6% in 2024 and 21.0% in 2025.

Quarterly figures trace a shallow trough: revenue eased from KRW 778.0bn in Q2 2025 to KRW 764.7bn and KRW 759.0bn in Q3 and Q4, then rebounded to KRW 819.3bn and KRW 829.0bn in Q1 and Q2 2026.

Operating profit bottomed at KRW 145.1bn in Q4 2025 before reaching KRW 194.0bn in Q2 2026, while attributable net profit recovered from KRW 105.2bn to KRW 140.8bn over the same span.

Q1 2026 net profit of KRW 187.3bn exceeded operating profit of KRW 157.6bn, pointing to non-operating contributions; Kyobo Securities attributed this to a one-off valuation gain from an accounting change tied to Indonesia's Superbank.

Attributable net profit for the four quarters from Q3 2025 to Q2 2026 totaled KRW 544.7bn. The balance sheet reflects banking mechanics: equity of KRW 6,749.9bn against liabilities of KRW 69,659.9bn at end-2025 implies a debt-to-equity ratio of 1,032%, largely because customer deposits are booked as liabilities.

Operating cash flow jumped from KRW 841.4bn in 2024 to KRW 6,005.8bn in 2025, but for banks this line swings with deposit and loan balances and cannot be read directly as a measure of earnings quality.

Industry analysis

Korean banking is being pulled by regulation and rates at the same time. Regulators set this year's household loan growth target at 1.5%, about half of projected nominal growth, effectively asking banks to hold supply flat.

As policy tightening pushed market rates up, the five major commercial banks' average July rate on new amortizing mortgages rose 0.074 percentage point from June to 4.498%, and lenders raised spreads while trimming preferential rates.

Higher rates constrain loan growth but can support margins at banks with a large low-cost deposit base. The three internet banks are chasing the same alternative market.

With household lending stalling, all three moved into the sole-proprietor segment, and K bank more than doubled its related balance from KRW 1.6tn to KRW 3.3tn in a year, lifting corporate loans to 17% of its won-denominated book.

On the funding side, buoyant equity markets pulled money away from all three, and KakaoBank's deposits fell KRW 2.25tn from the prior quarter to KRW 67.11tn at end-Q2.

Asset quality remains comparatively firm: KakaoBank's Q2 delinquency and substandard-and-below ratios were 0.51% and 0.54% versus 0.60% and 0.59% at K bank. The competitive focus is therefore shifting from balance growth toward platform monetization and non-bank portfolio expansion.

Outlook

The disclosed pipeline clusters around platform expansion and the non-bank push. For the second half, management said it would diversify fee and platform businesses, launching an integrated card payment and benefits hub in August along with a second PLCC credit card.

After a foreign-currency account in Q2, a service for foreign residents is planned for Q4 to open a new customer segment.

In capital finance, approval is the gate: the company plans about KRW 150bn of injections in two tranches to build assets above KRW 1tn and to launch used-car installment financing in the first half of next year, seeking FSC approval within 2026 with a target of new services and full-year profitability in 2027.

Management said the deal's capital impact is limited, at a 2-3bp decline in the CET1 ratio on current terms. On margins, the company expects further net interest margin improvement in the second half on the back of higher policy rates.

For lending, growth is to be led by sole-proprietor loans plus policy and inclusive-finance products in the second half, while over the medium term the growth-oriented value-up plan announced in 2024 targets KRW 100tn in assets by 2027.

On new ventures, management said specifics on a won-based stablecoin are hard to detail ahead of legislation, but pointed to group infrastructure across payments, banking, brokerage and insurance as a basis for partnering at home and abroad.

Valuation

PER

19.2×

PBR

1.6×

ROE

8.2%

EPS

₩1,143

BPS

₩14,013

Dividend per share

₩460

Profit has moved higher in each fiscal year since 2022, and the sum of the last four quarters sits above the full-year 2025 figure. The shares trade at a premium to book value, reflecting the higher multiples that internet banks have carried relative to the traditional bank average since listing.

Shareholder returns are on an expanding path: the board approved a dividend for the prior fiscal year, taking the total payout ratio to 45.6%, and management said it would raise the total return ratio stepwise from 45% in 2025 to 50% in 2026. Sell-side views diverge.

In an August 5, 2026 report, Samsung Securities said second-quarter net profit beat consensus but platform monetization remains the task, maintaining a Hold rating and a target price of KRW 28,000, and stating that re-rating hinges on finding new loan growth drivers and strengthening platform-based revenue.

By contrast, KB Securities in a July 2, 2026 note maintained a Buy rating and a KRW 33,000 target price, citing margin improvement alongside a better loan-to-deposit ratio and entry into mortgage-backed lending for sole proprietors.

Whether the multiple is sustained therefore rests on the alternatives to regulated household loan growth and on how quickly platform and non-bank income actually contribute.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-04

Bull factors

Structural expansion of non-interest and platform income

Non-interest income excluding loan interest rose 22.4% in 2025 to KRW 1,088.6bn, passing KRW 1tn for the first time on an annual basis and exceeding 35% of operating revenue. Advertising revenue grew 81% year on year on expanded premium placements, lifting its share of platform income from 19% to 31%.

Partner loans executed through the loan comparison service rose 12% to KRW 1.56tn in Q2, while MMF Box and fund balances expanded to KRW 1.8tn, taking share of retail public fund sales among banks to 4.2%. A widening set of non-interest streams cushions earnings volatility during a regulatory squeeze.

Funding advantage from low-cost deposits

Low-cost deposits were 56.7% of the base at end-June against a sector average of 39.5%, and the quarterly funding cost ratio fell to 1.82%. The Q2 net interest margin rose 13bp quarter on quarter to 2.13%, as asset yields gained 11bp on higher market rates and more unsecured lending while liability costs fell 2bp.

Management expects further margin improvement in the second half on rising policy rates. In a rising-rate environment the funding mix widens the room for margin gains.

Growth options beyond banking and overseas

The board approved buying 100% of Mastern Capital for KRW 24.1bn, aiming to close as early as year-end to secure a capital-finance license and operating base, then enter auto finance via installment lending next year.

Management said subsidiary status could lift Mastern Capital's credit rating through parent support, and that lower funding costs could improve its interest margin.

Abroad, the company completed setting up Bank X, a digital bank preparatory entity with SCBX in Thailand, and signed an MOU with MCS Group in Mongolia alongside a strategic stake in M Bank. Efforts to build earnings sources outside regulated domestic household lending have advanced to signed transactions.

Bear factors

Loan growth capped by rules, deposits leaking out

With the regulator's household loan growth target set near 1.5%, effectively a flat-supply mandate, household loans grew only KRW 234bn in Q2 and total loans rose KRW 518bn to KRW 48.2tn. Deposits fell KRW 2.25tn from the prior quarter to KRW 67.11tn.

Most analyses read the crowding into sole-proprietor loans as a reaction to tighter household lending rules. Balance growth is thus heavily exposed to policy variables.

Absolute scale of fee and platform income

Fee and platform income rose 2.9% in 2025 to KRW 310.5bn, still a limited share of that year's KRW 3,086.3bn in operating revenue. First-half fee and platform income was KRW 169.6bn, up 10.5% year on year.

In its August 5, 2026 report, Samsung Securities said platform monetization is the outstanding task and that re-rating depends on new loan growth drivers and stronger platform-based revenue. The gap between traffic metrics and revenue contribution remains the key issue.

One-off gains and early-stage capital-finance costs

As for Q1 2026 net profit of KRW 187.3bn exceeding operating profit of KRW 157.6bn, Kyobo Securities pointed to a one-off valuation gain from an accounting change related to Indonesia's Superbank.

The acquisition target also carries early-stage burdens: Mastern Capital is a small specialized lender with assets in the KRW 50bn range that swung to a loss last year on higher credit costs. Its 2025 net loss was KRW 2.30bn, reversing from a KRW 391m profit in 2024.

With roughly KRW 150bn of injections in two tranches and a 2027 profitability target, costs may run ahead of contribution in the interim.

Risk factors

Policy and regulation

With the household loan growth target set around 1.5%, any further tightening of volume management could again reshape the loan growth path. Commercial banks have raised online mortgage rates and cut purchase-purpose limits, showing higher lending hurdles across the sector.

The internet-bank requirement to keep mid- to low-credit lending above 30% of the book remains a constraint on portfolio adjustment. Policy shifts feed directly into both earnings mix and asset growth.

Credit risk

Q2 delinquency was 0.51% and the substandard-and-below ratio 0.54%, similar to the prior quarter. Still, with 48% of first-half net loan growth coming from sole-proprietor loans, sensitivity to small-business conditions and rate levels is increasing.

Observers note that after the acquisition, reviewing the existing corporate loan and lease book and stabilizing credit costs will likely be the first task. Whether credit costs offset margin gains needs quarterly verification.

Execution and approval risk

A bank taking a financial company as a subsidiary requires regulatory approval of the change in major shareholder and a subsidiary review, and approval plus post-merger integration still lie ahead of launch.

The plan to inject about KRW 150bn, grow assets above KRW 1tn and launch used-car installment finance in the first half of next year ties schedule and capital commitment together.

Overseas, management said it aims for overseas expansion to deliver financial results beyond one-off gains at a certain level relative to total revenue, so accounting recognition of equity investments should be distinguished from actual operating contribution. A won-based stablecoin remains pre-legislation, with no confirmed commercialization timeline.

What to watch next

October-November 2026
Third-quarter results and the earnings call. Key items are the direction of the net interest margin from 2.13% in Q2, plus whether sole-proprietor loan balances and fee and platform income growth hold the first-half trend.
Fourth quarter 2026
The plan to seek FSC approval for the capital injection within 2026 and to close the acquisition as early as year-end. Approval timing and the first tranche of the roughly KRW 150bn injection will set when capital-finance operations begin.
Fourth quarter 2026
Whether the planned fourth-quarter service for foreign residents actually launches, and initial customer inflows. This shows whether a new segment adds growth on top of the 27.63m customer base.
Bank of Korea rate meetings in November 2026 and January 2027
Policy rate decisions and market rate direction. Since management expects second-half margin improvement on rising policy rates, the rate path affects both margins and treasury income.
First half of 2027
The launch of used-car installment financing and the target of full-year profitability at the capital subsidiary, along with progress toward the KRW 100tn asset goal for 2027. This is the first window to verify whether the non-bank pillar adds to profit.

Overall view

KakaoBank posted 2025 operating revenue of KRW 3,086.3bn, operating profit of KRW 649.4bn and attributable net profit of KRW 480.3bn, extending the rising profit direction seen since 2022, with the operating margin recovering from 19.2% in 2023 to 21.0% in 2025.

On a quarterly basis, operating profit climbed from KRW 145.1bn in Q4 2025 to KRW 194.0bn in Q2 2026, though Q1 2026 net profit included the one-off valuation gain tied to Indonesia's Superbank flagged by Kyobo Securities and should be separated from underlying earnings power.

The positive pillars are a 56.7% low-cost deposit mix and a 1.82% funding cost ratio, annual non-interest income of KRW 1,088.6bn at more than 35% of revenue, and portfolio widening into capital finance and overseas markets.

The negatives are growth constraints, with household loans up only KRW 234bn and deposits down KRW 2.25tn under regulation, fee and platform income still around KRW 310.5bn, and execution risk in approvals and integration.

On valuation, views diverge: Samsung Securities kept a Hold and a KRW 28,000 target in August 2026, while KB Securities maintained a Buy and a KRW 33,000 target in July 2026.

Ahead, third-quarter margin trends, regulatory approval within this year and the fourth-quarter service launch are the sequentially verifiable events. This report is for informational purposes and does not contain buy or sell recommendations.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.