South Korean brokerage houses are projected to keep up hot earning streak after benefiting from retail stock frenzy last year as liquidity towards the equity market stayed strong.
The country’s top four brokerage names excluding those under financial holding firms are expected to turn out a net profit of above 200 billion won ($179.9 million) for the first three months this year, according to the consensus data compiled by Seoul-based financial data provider FnGuide on Tuesday.
Kiwoom Securities Co. is estimated to have earned 223.8 billion won in net profit for the January-March period, surging a whopping 3,244 percent from a year ago. The figure is even 4.46 percent higher than the profit three months ago when the market continued its rally amid retail stock fever.
Mirae Asset Securities is projected to report a net profit of 263.1 billion won (up 36.98 percent on quarter), and NH Investment & Securities 216.5 billion won (up 185.55 percent).
Samsung Securities is forecast to report highest-ever quarterly net profit of 246.1 billion won, up 193.81 percent from a quarter ago and 1,497.84 percent from a year earlier on a rapid increase in brokerage commission fees.
“Samsung Securities’ brokerage commission fees are estimated to have jumped 41.4 percent on year to 244.8 billion won in the first quarter, and interest income up 22.6 percent to 179.4 billion won,” said Kim In, an analyst at BNK Securities.
Daily trade turnover in Korea expanded to 33.3 trillion won in the January-March period from 27.6 trillion won three months earlier.
Securities stocks also have rallied since the beginning of the year. Mirae Asset Securities shares gained 6.46 percent, Samsung Securities 7.79 percent, Kiwoom Securities 7.51 percent, and NH Investment & Securities 10.18 percent.
In April alone, Samsung Securities shares rose 10.52 percent.
Outlook for their investment banking business also is brighter. New stock offerings this year are estimated to exceed 10.1 trillion won record in 2010. Initial public offerings in the first quarter totaled 2.1 trillion won.
By Moon Ga-young and Lee Ha-yeon
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]