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Real estate trust firms post record net income

The net income of South Korea's real estate trust companies hit an all-time high last year, with interest rates staying low and newly built apartments selling like hotcakes, data showed Thursday.

Eleven such firms here reported combined net profits of 393.3 billion won ($343 million) last year, up 77 percent from 2015, according to the Financial Supervisory Service.

Apartments under construction in Korea (Yonhap)
Apartments under construction in Korea (Yonhap)

It marks a record high, boosted by increases in operating and non-operating income alike.

The FSS said those firms capitalized on low interest rates amid robust apartment sales in the year.

Operating revenues rose 40.6 percent on-year to 786.2 billion won, with commission income climbing 38.8 percent.

Their total assets also jumped 36.9 percent to 2.7 trillion at the end of 2016. Assets under management by the companies totaled 155.9 trillion won, up 11.8 percent from a year earlier.

Their net capital ratio reached an average of 869.7 percent last year, down 205.5 percentage points from 2015, mainly attributable to dividend payouts and increased equity investment.

"However, all of the real estate trust companies met regulatory capital requirements, reporting the NCR well above the supervisory guideline of 150 percent," said the FSS. (Yonhap)

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