Q3 operating profit hits 521.1 billion won, up 33.2% on-year
IB strength shields earnings amid stock market rout
Cumulative net profit of 1.35 trillion won surpasses full-year 2025 result
IMA products sell out repeatedly, drawing high-net-worth investors
NH Investment & Securities posted operating profit growth of more than 30 percent in the third quarter despite a sharp domestic stock market decline and falling trading volumes.
The brokerage offset weaker commission revenue from the market downturn with solid performance in its investment banking division. Its newly launched integrated management account, or IMA, business also sold out every product it offered, laying what analysts say is a foundation for medium- to long-term growth.
NH Investment & Securities recorded consolidated operating profit of 521.1 billion won ($394 million) in the third quarter, up 33.2 percent from the same period last year, according to preliminary figures released Tuesday by the financial investment industry. Sales rose 149.2 percent to 6.78 trillion won over the same period, while net profit for the period climbed 35.5 percent to 383.6 billion won.
Cumulative net profit attributable to controlling shareholders through the third quarter reached 1.35 trillion won, already surpassing the company's full-year net profit of 1.03 trillion won for 2025. The result is particularly notable given that the domestic stock market fell sharply in the third quarter, worsening operating conditions across the brokerage industry.
NH Investment & Securities defended its profitability amid heightened market volatility by leveraging its investment banking capabilities. It ranked first in lead-managing both corporate bond and financial bond issuances in the third quarter, and placed second in initial public offering underwriting with a 21 percent market share. Its asset management division also limited profit erosion by maintaining a conservative strategy through rising interest rates and falling equity prices.
Quarter-on-quarter, however, earnings slowed. Operating profit and net profit for the period fell 23.5 percent and 21.6 percent from the previous quarter, respectively, as average daily domestic equity trading value dropped 41.8 percent quarter-on-quarter to 52.5 trillion won, cutting into brokerage commission revenue.
The decline also reflects a high base effect from the second quarter, when the domestic market enjoyed an unprecedented rally. Unlike the second quarter — when Kospi broke through the 9,000 mark to set an all-time high — the third quarter saw a sharp correction. Even so, NH Investment & Securities recorded double-digit year-on-year growth in operating profit, net profit and net operating revenue.
A standout development was the successful market debut of the IMA business. Since being designated as an IMA operator this year, NH Investment & Securities has sold out every product it has launched, securing a new growth engine.
The first product, "N2 IMA1 Mid-term No. 1," launched in April, filled its entire 400 billion won subscription limit. The second product, worth 120 billion won, sold out within half a day of opening subscriptions in June. The third sold out within a single day of opening, also hitting its 120 billion won target — marking three consecutive sellouts. Combined issuance across the first three products reached 640 billion won. A short-term product introduced most recently also sold out.
NH Investment & Securities is currently accepting subscriptions through Thursday for "N2 IMA1 Mid-term No. 4," a 120 billion won offering with a maturity of two years and three months and a performance-fee benchmark return of 4.5 percent per year. Structured identically to the third product, it applies a performance fee to returns exceeding the benchmark.
IMA products invest customer funds in corporate finance assets such as business loans, corporate bonds and acquisition financing, then distribute the returns. A key feature is that the brokerage guarantees repayment of principal if the investor holds the product to maturity. NH Investment & Securities plans to develop IMA into a core growth business, drawing on the corporate finance expertise it has built through its existing IB operations.
Growing interest from high-net-worth investors is another encouraging sign. Customers with assets of 1 billion won or more accounted for 68 percent of sales in the third product, up from 62 percent in the first and 51 percent in the second.
Fresh capital inflows have also been strong. Some 42 percent of the funds raised through the third product came from outside existing NH Investment & Securities accounts. Across the first three products combined, new inflows accounted for 56.7 percent of total subscriptions — suggesting that IMA has become a channel for attracting new investment demand rather than simply reallocating existing customer assets.
NH Investment & Securities expects the IMA business to deepen synergies between its investment banking and wealth management divisions. The company envisions a virtuous cycle in which funds raised from customers are channeled to promising companies, while returns generated from corporate finance investments flow back to those customers.
"With equity capital expanding to 11 trillion won, the medium- to long-term growth foundation — including the IMA business — has been further strengthened," an NH Investment & Securities official said. "We will continue to expand corporate finance supply through the IMA business and steadily enhance our competitiveness in customer asset management."
The official added that the company would "strengthen cross-business collaboration among our wealth management, investment banking and asset management divisions to improve resilience against market volatility and build a stable, sustainable earnings structure."
th5@heraldcorp.com
