Align Partners "KB Financial's Shareholder Return Plan is the Largest Ever... No Shareholder Proposals Expected"

[Asia Economy Reporter Park So-yeon] Activist fund Align Partners expressed that it "greatly welcomes the shareholder return policy of KB Financial at a level exceeding expectations."

On the 7th, Align Partners emphasized, "The 2022 shareholder return ratio of 33% (dividend payout ratio 26% + share buyback and cancellation 7%) announced by KB Financial today is the highest ever in the banking industry and represents a 7 percentage point increase compared to the previous year."

They further interpreted, "The core content of the capital policy and shareholder return policy announced by KB Financial today is that shareholder returns will be made in principle on CET1 ratios above 13%, asset growth will be managed at the level of nominal GDP growth for efficient capital allocation from a shareholder value perspective, and considering severe undervaluation, share buybacks and cancellations will be utilized more aggressively going forward."

They added, "This aligns with Align Partners' shareholder proposal requirements (shareholder returns on CET1 ratios above 13%, managing asset growth at nominal GDP growth levels to expand shareholder returns with surplus capital), and through today's announcement, investors can now make clearer predictions regarding KB Financial's future capital ratio management, capital allocation, and shareholder returns."

Align stated, "We plan to comprehensively summarize and announce the implications of the shareholder return ratio announced today shortly after February 9," and explained, "Although this is not a board resolution or a form of fair disclosure, the management and board of directors engaged in in-depth discussions and included the specific policy in today's earnings release materials, providing detailed explanations through a conference call."

They also mentioned, "According to our internal legal review, this announcement is legally sufficiently binding, and KB Financial is effectively obligated to faithfully adhere to the announced content, thus meeting our required standards," and added, "We expect that the dividend-related matters in KB Financial's business report, which will be disclosed one week before the general shareholders' meeting, will specifically include the policies announced this time."

Furthermore, they said, "We positively evaluate and welcome KB Financial's announcement and will not submit shareholder proposals at this KB Financial shareholders' meeting," adding, "We will closely monitor whether KB Financial actually implements the announced policies, and if the policies are not properly executed, we are prepared to take necessary actions."

They emphasized, "We urge other financial holding companies to announce capital allocation and shareholder return policies that meet Align Partners' requirements as KB Financial has done, and we will closely monitor and take necessary actions."