Press Releases - Financial Services Commission

Press Releases

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May 11, 2007

IIF-FSC/FSS Strategic Dialogue on Effective Regulation

The Financial Supervisory Commission/Financial Supervisory Service jointly hosted with the Washington DC-based Institute of International Finance (IIF) Asia’s first “Strategic Dialogue on Effective Regulation” on May 10, 2007. The meeting was held in Seoul and attended by senior regulators from ten regulatory authorities and central banks in the Asia/Pacific region and executives and representatives from global financial services firms that are active in the region.In his remark, Chairman/Governor Yoon Jeung-Hyun commended the initiative taken by the IIF to encourage dialogue between regulators and globally active financial services firms and stressed the need for stepped-up efforts on harmonization of cross-border financial regulations in order to build a more effective regulatory environment across the Asia/Pacific region. To this end, he proposed that the public/private sector dialogue take place regularly as a way to build new momentum and facilitate continued progress. As a first concrete step out of the May 10 dialogue, Chairman/Governor Yoon also proposed the creation of a task force made up of representatives from the region’s regulatory community, the financial services industry, and the IIF for more in-depth discussions and exchange of public/private sector views.Since assuming the helm of the FSC and the FSS in August 2004, Chairman/Governor Yoon has been a strong advocate of cooperation among regulators and has signed MOUs on exchange of information and cooperation with 16 regulatory authorities in 11 countries. The successful conclusion of the May 10 strategic dialogue and Chairman Yoon’s proposal for continuing public/private sector engagement also highlight Korea’s commitment to promoting robust regional cooperation and building an effective regional regulatory framework that supports financial stability and economic growth in the Asia/Pacific region.* Please refer to the attached PDF for details.
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Apr 05, 2007

Bank BIS Capital Ratios, 2006

Bank BIS capital ratios at the end of 2006 averaged 12.75%, slightly down from 12.95% at end-2005. With net income of KRW13.3 trillion for 2006, bank capital increased 16.1 trillion or 15.7% from a year earlier. But the increase was offset by a 17.5% jump in risk-weighted assets totaling KRW138.2 trillion, mostly due to the growth of mortgage and SME loans. Tier-1 capital rose 15.9% (KRW11.7 trillion) and tier-2 capital 15.1% (KRW4.4 trillion).The capital ratio rose for six banks but fell for the 12 others compared to end-2005. In terms of international comparison, recent figures from IMF financial soundness indicators and others show that the 12.75% capital ratio for domestic banks is at the higher end of the 12.15%-12.76% range for U.S., U.K., and German banking organizations. With continued income growth and further room for tier-2 capital, domestic banks are expected to maintain robust capital positions going forward.* Please refer to the attached PDF for details.
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Mar 21, 2007

Signing of Statement of Protocol with U.S. PCAOB

The Financial Supervisory Commission and the Financial Supervisory Service announced the signing of Statement of Protocol (“Statement”) with the U.S. Public Company Accounting Oversight Board (PCAOB) on March 21. The Statement, signed by Mr. Yoon Jeung-Hyun, Chairman of the FSC and Governor of the FSS, and Mr. Mark Olsen, Chairman of the PCAOB, in Seoul, is intended to facilitate cooperation in matters related to the oversight of the auditors of both countries and thereby contribute to improved accuracy and reliability of audit reports.The Statement consists of four key provisions on cooperation relating to inspection, investigation, sanction, and confidentiality. In respect of cooperation in an inspection, the Statement provides that each regulatory authority may, on behalf of or in support of the other, review audit papers, conduct interviews of an audit firm’s personnel, and assess an audit firm’s quality control system. In determining sanctions for accounting firms that fall within the regulatory jurisdiction of both the FSC/FSS and the PCAOB, the Statement provides that each regulatory authority shall endeavor to take into account the laws and regulations of the other. In respect of confidentiality, the Statement calls on both the FSC/FSS and the PCAOB to hold confidential documents and information created or received in the course of cooperation.For the FSC/FSS, the signing of the Statement is the first ever with a foreign audit oversight authority, and the expectation is that the Statement will contribute to enhanced cooperation on the oversight of accounting firms between the two countries. With regulators elsewhere stepping up oversight of auditors of multinational companies whose securities are traded in their markets, the FSC/FSS will endeavor to enter into similar cooperative arrangements with other foreign regulatory authorities in order to avoid duplicate audit supervision and reduce compliance cost.* Please refer to the attached PDF for detail
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Feb 01, 2007

FSS to Launch Electronic Foreign Investor Registration and English DART Website

The Financial Supervisory Service will launch an electronic registration system for foreign investors and open an English DART website (http://enlgishdart.fss.or.kr) as part of an ongoing effort to simplify foreign investors’ investment procedures and improve their access to corporate information. DART, which stands for Data Analysis, Retrieval, and Transfer, is the FSS electronic disclosure system companies use to transmit regulatory filings and ongoing disclosures via the Internet.Electronic Registration of Foreign InvestorsUnder the current procedure, a foreign investor (or an agent) who wishes to acquire shares of listed companies and other exchange-traded securities submits an investment registration application along with the supporting documents to the FSS in person and returns three to four days later for the registration certificate.The new registration system, which is set to begin in May this year, will enable foreign investors to file investment registration applications and receive registration certificates electronically through financial institutions acting as their agents.Because the system utilizes information and telecommunication networks and electronic document exchange systems already used by financial institutions, no additional cost is expected from foreign investors or financial institutions. With electronic registration, the issuance of registration certificate, which numbers about 2,000 a year, is expected to be shortened from up to four days to no more than four hours.Opening of English DART WebsiteThe FSS will also open an English DART website (http://englishdart.fss.or.kr) on February 1 to improve foreign investors’ access to disclosures filed by Korea’s publicly traded companies. Foreign investors can use the English DART website to search all English disclosure documents voluntarily transmitted to DART and to Korea Exchange as well as corporate information available in English at Korea Listed Companies Association.The English DAR
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Jan 24, 2007

Preliminary Bank Net Income for 2006

Preliminary figures show domestic banks’ net income for 2006 will come to KRW13.49 trillion, compared with KRW13.63 trillion for 2005. Interest income rose KRW1.51 trillion on sharply increased lending, but the overall net earnings were held back by a KRW1.73 trillion jump in income tax expenses (partly from a drop in losses carried forward) for 2006. Operating and nonoperating income for the year totaled KRW13.26 trillion and KRW4.12 trillion, respectively.Loans outstanding at end-2006 totaled KRW873.8 trillion, up KRW122.4 trillion from end-2005 total of KRW751.4 trillion. Despite continued improvement in asset soundness, loan loss provisions fell only slightly in 2006—from KRW5.1 trillion to KRW5.0 trillion—due to more stringent provisioning requirements.ROA for 2006 fell to 1.12% from 1.27% a year earlier on reduced net interest margin. Gross profit ratio, a key measure of profitability, came to 2.82%, down slightly from 2.98% a year earlier.* Please refer to the attached PDF for details.
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Jan 18, 2007

FSC Proposes to Merge Korea Exchange's Dual Futures Trading Systems into Single Trading System

The Financial Supervisory Commission announced a proposal to integrate the dual futures trading systems of Korea Exchange into a single integrated trading system in order to facilitate trading in futures and improve market efficiency. Currently, two different futures trading systems—KOSPI futures trading system and Korea Treasury Bond (KTB) futures trading system—that were used by Korea Stock Exchange (KSE) and Korea Futures Exchange (KOFEX) before they were brought under the Korea Exchange are in use. Because of its dual nature, the current trading system is said to inflate transaction cost to investors and create system inefficiencies.Under the FSC proposal, tentatively set to be implemented by end-June this year, the KOSPI futures trading system is to be adopted at the Korea Exchange for all futures and options trading as it already effectively handles nearly all of futures and options trading, including KOSPI200 futures, KOSPI200 options, Star index futures, and stock options. The KOSPI futures trading system also has the advantages of familiarity to investors, significant cost-effectiveness compared to the KOFEX system, and locally developed technologies.When the integration is completed, investors and traders are expected to benefit from simpler and more consistent trading rules (e.g., buying and selling of futures and options with a single trading account), while the Korea Exchange is expected to save KRW2.2 billion in system maintenance cost a year.* Please refer to the attached PDF for details.
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Jan 12, 2007

FSS Launches Online Search & Retrieval Tool for Legal and Regulatory Statutes Governing Financial Supervision

The Financial Supervisory Service opened a new online search retrieval system for legal and regulatory statutes governing financial supervision along with their interpretations and applications on January 9. The new tool, a Korean-based website database that can be launched from the FSS Internet homepage, holds more than 1,900 separate entries (over 30,000 pages) on legal and regulatory statutes pertaining to financial supervision as well as their administrative and judicial interpretations and applications and explanation of FSS administrative procedures and financial supervision. The database for the new search retrieval system is set to be updated each month and is expected to increase by approximately one thousand new entries a year henceforth.BackgroundBecause of the generally complex nature of legal and regulatory statutes governing financial products and services, there has been a growing awareness of the need to make financial laws and regulations more accessible to the general public. The new online tool was prompted by this need to help the general public search and access financial laws and regulations more easily and at the same time improve regulatory transparency.The plan for the new system took shape in August, 2006, when the FSS proposed an open search retrieve system after thorough review and study of similar systems in use elsewhere. The system was completed in late 2006 and went online January 9 after a series of operational tests.A Centralized Database of Legal and Regulatory Statutes Governing Financial SupervisionThe new search retrieve system is designed to function as a centralized database of all the legal and regulatory statutes, guidelines, interpretations, and explanations governing financial supervision. In particular, the new online tool employs a system of codification to classify and group interpretations and explanations of legal and regulatory precedents by year, financial sector, business operation, and laws regulations.Use of the
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Dec 21, 2006

Bank BIS Capital Ratios, September 2006

Bank BIS capital ratios averaged 13.10% at the end of September, compared with 13.06% at end-June and 13.00% at end-2005. Bank capital rose KRW14.6 trillion (14.2%) on net income totaling KRW11.5 trillion for the first nine months of the year, while risk-weighted assets increased KRW105.5 trillion (13.3%) during the same period. Tier-1 capital rose 16.5% (KRW12.2 trillion) compared with an 8.3% increase (KRW2.4 trillion) for tier-2 capital.The capital ratio rose for seven banks but fell for the 11 others compared to end-2005. For some of the banks with a lower capital ratio than at end-2005, increases in capital did not keep pace with increases in risk-weighted assets. But all the 18 banks reported capital ratios in excess of 10% and expect to maintain strong capital positions going forward with solid net income.* Please refer to the attached PDF for details.
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Nov 24, 2006

Assessment of Private Equity Industry, November 2006

The Financial Supervisory Service issued an assessment of Korea’s private equity industry on November 22, 2006, to mark the second year of regulatory changes that allowed the formation of private equity funds (PEFs) as a recognized investment entity for the first time in December, 2004.Registered PEFsThere were 20 registered PEFs as of end-October with a total investor subscribed (committed) amount of KRW4.66 trillion, of which KRW1.99 trillion were actually called. Since the beginning of 2006, six PEFs were newly registered and one was terminated for a net increase of five. The subscribed amount increased KRW1.76 trillion and the called amount KRW760.6 billion in 2006. At the end of 2005, there were 15 registered PEFs with KRW2.9 trillion in total subscribed amount and KRW338.8 billion in total called amount.Fund RaisingThere were seven large funds (more than KRW300 billion), six medium-sized funds (between KRW100 billion and KRW300 billion), and seven small funds (less than KRW100 billion) as of end-October. Three of the large funds exceeded KRW500 billion in total subscribed amount. Most of the small funds were so-called “deal-by-deal” PEFs that specialize in a specifically targeted company.Management fees typically ranged between 1.5% and 2% of the subscribed investment amount when PEFs were first introduced. But with a majority of institutional investors preferring financial, rather than strategic, investment whose returns do not depend too much on the fund management skills of the general partners (managers) of PEFs, management fees fell to a lower range between 0.1% and 2% of the investment executed.InvestmentsEleven PEFs had executed investments totaling KRW999.0 billion in 27 companies, including a KRW343.9 billion takeover of a privately held company in June, 2006, the largest PEF investment to date. Since the beginning of the year, the number of companies in which PEFs invested jumped from 9 to 27 with the total executed amount sharply up from KRW26
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Nov 15, 2006

Bank Loans Classified as Substandard or Below: September 2006

Bank loans classified as substandard or below (SBLs)–substandard, doubtful, or presumed loss–totaled KRW8.8 trillion at the end of September, unchanged from end-June. But the ratio of SBLs to total outstanding loans fell to 0.98%, the lowest ratio since the forward-looking criteria were first adopted in 1999. The SBL ratio averaged 1.02% at end-June and 1.22% at end-2005. A surge in new loans, which pushed the total outstanding loans to KRW895.2 from KRW861.3 trillion, was mostly responsible for the drop in SBL ratio.Overall, the SLB ratios fell modestly for the key borrower groups from end-June, averaging 1.06% for corporate loans and 0.81% for household loans. The ratio for credit card receivables increased slightly from 1.80% at end-June to 1.84%. But compared to end-2005, the SBL ratios fell for all the loan types.* Please refer to the attached PDF for details.
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Nov 15, 2006

Preliminary Bank Net Income: January-September 2006

Preliminary figures show domestic banks’ net income for the first nine months of 2006 will come to KRW11.1 trillion, compared with KRW10.5 trillion for the same period a year earlier. A drop in provisioning for loan losses and disposition of stocks from past debt-equity swaps mostly contributed to the increase. Income for the third quarter totaled KRW3.1 trillion, down from KRW4.0 trillion a year earlier.For the January-September period, ROA averaged 1.26%. The gross income/asset ratio, a key measure of profitability, has fallen each of the three quarters in 2006, averaging 2.86% for the nine-month period, which compares unfavorably to 5.44% for the U.S. banks.Narrower net interest margin (NIM) resulting from competition most likely contributed to the declining bank profitability. NIM averaged 2.66% for the January-September period, compared with 2.81% for the same period a year earlier.* Please refer to the attached PDF for details.
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Nov 10, 2006

Asset Management Companies' Preliminary Net Income:First Half of FY2006

Regulatory filings by 49 asset management companies–36 domestic and 13 foreign–show preliminary net income for the first six months of FY2006 ended September 30 totaled KRW150.9 billion, up KRW93.6 billion from KRW57.3 billion a year earlier. Pretax income came to KRW200.0 billion, compared with KRW78.5 billion a year earlier.A large increase in management fees boosted by a surge in investment into stock funds pushed asset management companies’ net income for the period. Management fees, which averaged 63 basis points at end-September, compared with 58 basis points a year earlier, jumped KRW124.8 billion or 67.1% to KRW310.7 billion. Investment in stock funds, which typically generate higher management fees than other funds, more than doubled from KRW21.9 trillion at end-September, FY2005, to KRW46.4 trillion.Domestic asset management companies’ pretax income for the period totaled KRW155.8 billion, an increase of KRW91.2 billion or 141.2% from a year earlier. For foreign asset management companies, the total come to KRW44.2 billion, compared with KRW13.9 billion a year earlier.As of end-September, assets under management totaled KRW230.7 trillion (net asset basis), an increase of KRW25.2 trillion or 12.2% from KRW205.5 trillion a year earlier. Both stock funds and hybrid funds grew by KRW24.5 trillion and KRW9.5 trillion, respectively, from a year earlier, but money market funds fell by KRW15.5 trillion during the period. Assets under the management of domestic asset management companies came to KRW191.4 trillion. For foreign asset management companies, the total was KRW39.3 trillion.* Please refer to the attached PDF for details.
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Nov 01, 2006

IMF-FSC/FSS to Host Macroprudential Supervision Conference in Seoul

The International Monetary Fund and Financial Supervisory Commission / Financial Supervisory Service will jointly host an international conference on macroprudential supervision in Seoul from November 7 to 8, 2006, at the Grand Hyatt Seoul Hotel.The conference, entitled “Macroprudential Supervision: Challenges for Financial Supervisors,” underscores the growing interest in macroprudential supervision among financial supervisors. With an emphasis on system-level approach to regulatory and supervisory frameworks, macroprudential supervision is taking shape as an added safeguard against financial instability.There have been a number of discussions among international organizations and several national supervisory authorities in recent years on various aspects of macroprudential supervision. But the Seoul conference is expected to be the first major international conference that will focus exclusively on macroprudential supervision. Thus, it will give the participants a unique opportunity to share with others experiences and expertise on macroprudential supervision.Approximately 350 participants at home and from abroad, including representatives from the International Monetary Fund and Bank for International Settlements, and the heads of the U.K. Financial Services Authority and the Australian Prudential Regulation Authority, are expected to attend the conference. Four separate sessions—Financial Stability, Approaches to Macroprudential Supervision, Stress Testing, and Case Studies of Macroprudential Supervision—with presentations and discussions on 15 topics are scheduled during the two-day conference.* Please refer to the attached PDF for details.
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Sep 22, 2006

Introduction of Third Insurance with Cash Value and Bancassurance Supervision

Bancassurance was first introduced in August, 2003, to help consumers purchase insurance at a lower cost and improve market efficiency. In light of the potential impact of bancassurance on the insurance market, a phase-in approach was adopted. Under this approach, sale of savings-type insurance began in August, 2003. This was followed by the sale of exclusively protection-type “third insurance” providing coverage against illnesses and injuries as well as post -illness and post -injury risks in April, 2005. In October, the sale of third insurance with cash value at maturity (TICV) is set to begin.Sales of Bancassurance ProductsDuring the second phase of bancassurance (April, 2005, to June, 2006), sales totaled KRW7.3 trillion–KRW6.2 trillion for life and KRW1.1 trillion non-life insurance products–on earned premium basis. With earned premium rising more than 30% in FY2005, the growth outlook on the bancassurance market looks positive. Nearly all of the bancassurance sales (98.9%) were made through banks. Kookmin Bank and Shinhan Bank held 28.8% and 19.4%, respectively, of the sales.Market for TICVThe market for TICV, which is set to begin in October, is estimated at KRW12.7 trillion–KRW7.9 trillion for life and KRW4.8 trillion for non-life insurance products–a year, approximately 14% of the insurance market.When the third-phase bancassurance commences, insurance products that can be sold through banks and other financial institutions are expected to account for 51.5% of life insurance products and 36.1% of non-life insurance products.Tax Benefits of TICVConsumers are expected to benefit from, among others, tax deductions and longer-term policies with TICV, a protection-type insurance that allows up to KRW1 million in deductions from the policyholder’s taxable income. The policy term for savings-type insurance is limited to 15 years (non-life), but no such term restriction is applicable to TICV as it is a protection-type insurance.Upsides of TICVConsumer
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Sep 12, 2006

Equity Disclosure Filings First Half 2006

An analysis of disclosure filings for investment in listed companies for the first six months of 2006 showed a total of 2,397 investors held five percent or more equity interests in 1,624 listed companies (700 Stock Market-listed and 924 KOSDAQ-listed). During the period, 2 tender offers and 122 proxy solicitations were made, compared with 5 and 108, respectively, during the same period a year earlier.Disclosures Filed under the “Five-Percent Rule”Disclosures filed under the five-percent reporting rule for the first six months of the year totaled 4,157, compared with 4,499 for H2, 2005, and 5,717 for H1, 2005. The total for H1, 2005, includes 1,791 re-filings made under the amended reporting rule that took effect March 29, 2005. Excluding the re-filings, the total for H1, 2005, was 3,926. Filings by foreign investors have steadily increased since 2003.By investment purpose, filings for exercising influence on the management totaled 1,609 (1,580 companies: 666 Stock Market-listed, 914 KOSDAQ-listed) as of the end of June. Those for investment only totaled 872 (1,139 companies: 516 Stock Market-listed, 623 KOSDAQ-listed).Filings by Foreign InvestorsA total of 307 foreign investors–288 legal entities and 19 individuals–held five percent or more equity interests in 505 listed companies, of which 242 were Stock Market-listed and 263 KOSDAQ-listed.Tender Offer FilingsTwo tender offer filings involving Choong Nam Spinning Co., Ltd. were made during the first six months of the year. There were no tender offers intended for enhancing management control or going private during the period.Proxy SolicitationsA total of 122 disclosures were filed for proxy solicitation during the first six months of the year. Of the total, 110 or 90.2% were for the purpose of meeting the quorum requirements in the general shareholders’ meetings. There were 12 filings for proxy contests during the period.* Please refer to the attached PDF for details.
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Sep 01, 2006

Chairman/Governor Yoon Jeung-Hyun to Visit Hong Kong, Thailand and Singapore for Talks on Supervisory Cooperation

Chairman/Governor Yoon Jeung-Hyun of the Financial Supervisory Commission and Financial Supervisory Service will visit Hong Kong, Singapore and Thailand and meet with senior supervisors and business leaders from August 31 to September 7. Throughout the trip, discussions are planned on wide-ranging supervisory issues, including cross-border supervisory cooperation, investor/consumer protection under free trade regime, MOU on exchange of information and joint examination, and implementation of Basel II capital framework. Chairman/Governor Yoon also plans to take the opportunity to share Korea’s success with financial-sector reform and promote its financial hub initiative to business leaders in the three countries.* Please refer to the attached PDF for details.
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Aug 30, 2006

Preliminary Bank BIS Capital Ratios: June 2006

Preliminary figures show bank BIS capital ratios averaged 13.08% at the end of June, compared with end-2005 average of 13.00%. Bank capital rose KRW9.1 trillion or 8.8% on robust net income totaling KRW8.1 trillion for the first half of 2006, compared with KRW64.6 trillion or 8.2% jump in risk -weighted assets. Tier-1 capital rose 11.0% (KRW8.1 trillion) versus a 3.3% increase (KRW1.0 trillion) for tier-2 capital.The capital ratio rose for nine banks but fell for the others. Banks with higher capital ratios were helped by strong earnings. Kookmin Bank and the National Agricultural Cooperative Federation increased their tier-2 capital by KRW1.9 trillion and KRW800 billion, respectively, with subordinated debt issues. For most of the banks with lower capital ratios than at end-2005, capital increases did not keep pace with increases in risk-weighted assets. Capital ratio for Shinhan Bank fell modestly following its merger with Chohung Bank on April 1, 2006. All the banks reported BIS capital ratio higher than 10% at end-June.* Please refer to the attached PDF for details.
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Aug 30, 2006

Bank Loans Classified as Substandard or Below: First Half, 2006

Bank loans classified as substandard or below (SBLs)–substandard, doubtful, or presumed loss–totaled KRW8.8 trillion at the end of June, down from KRW9.7 trillion at the end of 2005. The ratio of SBLs to total outstanding loans fell from 1.22% to 1.02%, the lowest ratio since the forward-looking criteria were first adopted in 1999. Disposition of borrower collateral, aggressive write-off of SBLs, and a smaller increase in new SBLs–KRW6.0 trillion compared with KRW8.8 trillion for H1, 2005, and KRW7.1 trillion for H2, 2005–mainly contributed to the drop in SBL ratio for the first half of 2006.The SLB ratios fell for all the key borrower groups during the first half from end-2005, averaging 1.09% for corporate loans, 0.86% for household loans, and 1.80% for credit card receivables. The ratio fell for 14 banks but modestly rose for 4 others.* Please refer to the attached PDF for details.
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Aug 17, 2006

Asset Management Companies Operating Results Q1 FY2006

Preliminary operating results from a total of 48 asset management companies show pretax income for the first quarter of FY2006 ended June 30 will come to KRW92.54 billion, up sharply from KRW21.59 billion a year earlier. A KRW67.44 billion increase in investment management fees driven by a surge in assets under management mostly contributed to the jump in pretax income for the period. Net income for the period is expected to total KRW72.54 billion.Pretax income for domestic asset management companies (36) came to KRW72.03 billion, compared with KRW14.42 billion a year earlier. For foreign asset management companies (12), the total came to KRW20.51 billion, compared with KRW7.17 billion a year earlier.As of the end of June, assets under management totaled KRW221.6 trillion, up slightly from the previous quarter’s total of KRW221.3 trillion. Both stock funds and hybrid funds grew by KRW5.1 trillion and KRW3.7 trillion, respectively, but money market funds fell by KRW13.1 trillion during the period. Assets under management by domestic asset management companies came to KRW183.5 trillion. For foreign asset management companies, the total was KRW38.1 trillion.* Please refer to the attached PDF for details.
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Jul 31, 2006

Bank First Half 2006 Net Income

Preliminary figures show domestic banks’ net income for the first half of 2006 will come to KRW8.09 trillion, up 23.4% or KRW1.54 trillion from KRW6.55 trillion a year earlier. An 8.5% or KRW1.1 trillion increase in interest income driven by continued loan growth as well as a 50.3% or KRW1.2 trillion drop in loan loss provisions mainly contributed to the robust earnings for the period.Net interest income for H1 totaled KRW14.5 trillion, up 8.5% from a year earlier, and made up 86.6% of the gross income for the period. Non-interest income jumped 6.3% to KRW2.3 trillion from KRW2.1 trillion a year earlier.As a result of the sharply higher H1 net income, the average ROA jumped from1.26% in H1, 2005, to 1.40%. The gross income/asset ratio fell slightly from 2.98% to 2.92%, while the net income/gross income ratio averaged 48.1%, compared with 42.2% a year earlier. Narrower interest margins (from 3.11% to 2.95%) most likely contributed to the modest drop of the gross income/asset ratio for the period despite a continued growth of loan assets.* Please refer to the attached PDF for details.
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