KB Financial Group’s third quarter profit increased from the previous quarter, but less than expected at 440 billion won.
Chairman Yoon Jong-kyoo said the group will always aim to top other financial groups in Korea, but it appears that he is having a hard time to lead the group to achieve its target, financial sources said recently.
The group announced on Oct. 22 that its Q3 net profit amounted to 407.1 billion won, up 19.9 percent from the preceding quarter, but down 8.78 percent year-on-year, which is lower than last year’s third quarter in which the group was mired in the scandal at its Tokyo Branch in Japan.
Underneath the disappointing results was the Q3 financial statement for the group ought to show that the POSCO share price was less than what the financial group had booked in value due to the fall in the steel maker’s share price on the stock market. So the group had to adjust its financial statement to show the situation.
The group’s interest earnings looked as solid as ever, at 1.552 trillion won, up 0.3 percent from the preceding quarter. Its income of fees and commissions also made a healthy jump of 0.9 percent at 397.4 billion won in Q3.
But the prices of POSCO shares booked in the financial statement would be much lower than forecasted and thus treated as a loss.
Another big change in the financial statement was shares of Korea Housing Guarantee Corp. helped push the loss from the sales of bonds and valuable papers to 244 billion won, compared to 89.5 billion won in profit in the previous quarter.
Analyst Hwang Kyu-shik of Kyobo Securities said the group’s Q3 performance results is not so bad considering the extended period for low interest rates for loans, but it failed to post the outstanding results like Shinhan Financial Group. He said the group is likely to do better in the last quarter of the year, with not much change expected from the Q4 results in the previous year.
KB Kookmin Bank, which takes up a huge part of the group’s operation, posted a net profit of 233.6 billion won, down 8 percent from the preceding quarter and down 33 percent year-on-year.
Officials of the group said they will continue to work harder to boost the group as the No. 1 financial group in Korea and become a permanent financial partner to everyone in Korea through their diverse efforts.
Aspiring to become an international leader of Finance, particularly in Asia, KB Financial Group has launched a phase-by-phase management strategy. First, until 2016, the group will continue to consolidate the basis for becoming a global leader of finance, developing and honing its key strengths and distinction in core areas of business and enhancing the stability of its business operations. Based on analyses of its management environment, the Group has identified four overarching strategy aims strengthening the basis for growth, reinforcing risk management, enhancing business capability and productivity, and strengthening future growth potentials as well as 15 core tasks. The Group will regain and consolidate its leadership over the financial market in Korea by 2019 with significant returns on its assets and investment portfolios, and thereby will become ready to predominate the Asian Financial market by 2022.
KB Financial Group is pursuing model enterprise of corporate governance for the objectives of transparent management, independence of the board of directors, and protection of shareholders’ rights.
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