The internet-only bank KakaoBank expanded fee-based and other non-interest income, achieving its largest-ever net profit.

KakaoBank said first-quarter (January-March) net profit was 187.3 billion won, up 36.3% from the same period a year earlier (137.4 billion won). This is a record high on a quarterly basis.

Interest income from loans was 516.5 billion won, growing 2.7% from a year earlier on the back of loans to sole proprietors and policy loans. The main driver of the record performance was non-interest income.

KakaoBank reported first-quarter non-interest income of 302.9 billion won, up 7.5% from the same period last year. The share of non-interest income in total operating revenue increased to 37%.

A KakaoBank representative said, “The expansion of advertising revenue, co-lending, travel services, and the diversification of fee and platform revenue sources contributed to growth in non-interest income.”

In the first quarter, loans extended to mid- to low-credit borrowers totaled 450 billion won; the share of new originations was 45.6% and the share of outstanding balances was 32.3%, exceeding the targets, KakaoBank explained.

As of the end of the first quarter, the number of KakaoBank customers was 27.27 million, an increase of 570,000 from the previous quarter. Monthly active users (MAU) in the first quarter were 20.32 million.

KakaoBank analyzed that deposit products such as the Group Account and Our Kids Account, as well as artificial intelligence (AI) services, contributed to attracting new customers and increasing traffic.

A KakaoBank representative said, “This year, we will create balanced earnings based on deposit competitiveness,” and “we will also push ahead with a global business expansion strategy, including Indonesia Superbank, a virtual bank in Thailand, and cooperation with the MCS Group in Mongolia.”