[비즈한국] Samsung Card029780 announced that it recorded a net profit of 156.3 billion KRW in the first quarter of this year. This is a 15.24% decrease from the 184.4 billion KRW net profit recorded in the first quarter of last year. While Samsung Card's revenue increased compared to the previous year, its net profit fell because costs rose even more significantly. This is also expected to impact the evaluation of Samsung Card CEO Kim Yi-tae. CEO Kim took office in March of last year, and coincidentally, Samsung Card's net profit has been on a downward trend since then.
The net profits of major domestic card companies are generally on an upward trend. KB Kookmin Card’s profit grew from 84.5 billion KRW in the first quarter of last year to 107.5 billion KRW in the first quarter of this year, and Hyundai Card’s profit increased from 61.4 billion KRW to 64.7 billion KRW. Woori Card also saw an increase from 32.8 billion KRW to 43.9 billion KRW, and Hana Card rose from 54.6 billion KRW to 57.5 billion KRW.
Shinhan Card was an exception, with its net profit decreasing from 135.7 billion KRW in the first quarter of last year to 115.4 billion KRW in the first quarter of this year. This appears to be the result of a voluntary retirement program implemented earlier this year. A Shinhan Card representative stated, "Although credit card revenue increased, net profit declined year-on-year due to investments to strengthen our member base—the core of our business—as well as cost increases linked to higher payment volumes and the reflection of one-off factors (voluntary retirement costs)."
Increased costs are also behind the decline in Samsung Card's net profit. Samsung Card's operating expenses rose from 648.5 billion KRW in the first quarter of last year to 894 billion KRW in the first quarter of this year. In particular, selling, general, and administrative (SG&A) expenses increased by 12.42%, from 476 billion KRW to 535.1 billion KRW. In addition, losses from derivatives and foreign currency valuation also grew from 33.3 billion KRW in the first quarter of last year to 194.2 billion KRW in the first quarter of this year.
However, unlike Shinhan Card, there are no specific issues that can be considered one-off factors. Samsung Card has not issued a particular statement regarding the cost increase.
While the performance of major domestic card companies has improved, the outlook for the credit card industry is not necessarily bright. With the timing of base interest rate cuts being delayed, there is growing concern over a prolonged high-interest rate environment, suggesting that funding costs will remain high for the time being. The funding cost rate refers to the ratio of interest expenses incurred when financial firms borrow funds. While Samsung Card is known to have a lower funding cost rate than its peers, it is difficult to be optimistic about future performance if the high-interest rate trend continues.
If Samsung Card's net profit continues to decline in the second quarter, investor anxiety is expected to heighten. Chae Young-seo, a senior researcher at Korea Investors Service, commented on Samsung Card, "Profitability in the payment sector has weakened due to cuts in merchant commission fees and increased marketing expenditures, and the rise in funding costs due to the prolonged high-interest rate trend will act as a factor for declining profitability. We will monitor whether the company can maintain profitability through asset efficiency and proactive risk management in this unfavorable environment."
Samsung Card appointed CEO Kim Yi-tae in March of last year. CEO Kim, who came from the Ministry of Economy and Finance, joined Samsung Electronics005930 in 2016 and served as Executive Vice President of Samsung Electronics and CEO of Samsung Venture Investment. He took office as President and CEO of Samsung Card in March 2025.
Coincidentally, Samsung Card has seen a downward trend in net profit since CEO Kim took office. Samsung Card's net profit rose from 609.4 billion KRW in 2023 to 664.6 billion KRW in 2024. However, it recorded 645.9 billion KRW in 2025, after CEO Kim took office, marking a year-on-year decrease, and it has fallen again in the first quarter of this year compared to the same period last year.
CEO Kim Yi-tae's term lasts until March 2028, so there is still time remaining. Attention is focused on whether CEO Kim can successfully improve performance during his remaining tenure and turn around the evaluations.