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Investment advisory firms see combined profit tumble in fiscal Q2

All News 06:00 December 07, 2017

SEOUL, Dec. 7 (Yonhap) -- The combined net profit of 175 investment advisory firms in South Korea sank 94.4 percent on quarter in the fiscal second quarter of this year, hit by a sharp decline in commission fees, data showed Thursday.

The investment advisory firms reported a combined net profit of 1.6 billion won (US$1.4 million) during the fiscal second quarter that ended in September, compared to a profit of 28.4 billion won in the previous quarter, according to the data from the Financial Supervisory Service (FSS).

Their average return on equity, a measure of profitability, also fell 18.6 percentage points from a quarter earlier to 1.6 percent.

Profitability at investment advisory firms worsened as contracts declined, the FSS said.

At the end of September, their combined contract volume fell 3 percent on quarter to 12.9 trillion won, the data showed.

In a statement, the FSS said the combined contract volume of investment advisory firms has been on a steady decline since 2015.

The FSS will step up its monitoring into potential financial risks of small and medium-sized investment advisory firms, it said.

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