KB Financial Group's Cumulative Q3 Net Profit Reaches 3.7 Trillion KRW...31.1% Increase (Update)

Expansion of Profit Generation Base through Strengthening Core Businesses by Division
Result of Efforts to Diversify Business Portfolio through M&A

[Asia Economy Reporter Park Sun-mi] KB Financial Group announced on the 21st that its net income attributable to controlling interests for the third quarter reached 1.2979 trillion KRW, an 11.3% increase compared to the same period last year.

Compared to the previous quarter, it increased by 7.8%. The increase in net income was influenced by stable net interest income and net fee income growth, along with a decrease in credit loss provisions.

On a cumulative basis for the third quarter, net income reached 3.7722 trillion KRW, up 31.1% (894.3 billion KRW) from 2.8779 trillion KRW in the same period last year. Cumulative net interest income increased by 15.6% to 8.2554 trillion KRW, and net fee income rose by 26.4% to 2.7439 trillion KRW. This is interpreted as the result of expanding the revenue base through strengthening core businesses by business segment and diversifying the business portfolio through mergers and acquisitions (M&A).

As of the end of September, KB Financial Group’s total assets stood at 650.5 trillion KRW, and the group’s total assets including assets under management (AUM) amounted to 1,121.8 trillion KRW (based on simple aggregation of group affiliates). The group’s asset soundness remained stable. The non-performing loan (NPL) ratio improved by 0.03 percentage points from the end of June to 0.36%.

By major affiliates, KB Kookmin Bank recorded a cumulative net income of 2.2003 trillion KRW for the third quarter, a 16.9% (317.9 billion KRW) increase compared to the same period last year. Interest income steadily increased due to asset growth from M&A and stable loan growth, and fee income expanded due to increases in trust income and IB business-related profits. Proactive risk management led to a decrease in credit loss provisions, and the impact of last year’s additional COVID-19 related loan loss provisions also dissipated.

KB Securities’ cumulative net income for the third quarter was 543.3 billion KRW, up 60.5% (204.8 billion KRW). Amid a booming stock market, stock trading volume increased and efforts to grow customer custody assets led to higher custody fees. Additionally, IB business fees and capital market-related profits improved significantly, resulting in balanced performance improvements across all business divisions including WM, IB, and S&T through strengthened competitiveness.

KB Insurance’s cumulative net income for the third quarter was 269.2 billion KRW, a 44.3% (82.6 billion KRW) increase. Insurance profits expanded due to overall loss ratio improvements centered on automobile insurance, and investment income increased influenced by higher dividend income from investment funds. KB Kookmin Card posted a cumulative net income of 374.1 billion KRW, up 46.6% (118.9 billion KRW). Interest income improved due to business combination effects from M&A, and fee income increased thanks to higher card usage and company-wide marketing cost efficiency efforts.

Prudential Life recorded a cumulative net income of 255.6 billion KRW for the third quarter. Stable growth in interest income, improved insurance profits due to a reduction in new contract costs from an increased proportion of savings-type product sales, and expanded investment income through strategic asset sales contributed to solid performance.