Chairman Yoon Jong-kyoo of KB Financial Group aims to boost the earnings ratio of non-banking affiliates to 40 percent of total group earnings. The new strategy comes in the wake of its failed takeover attempt of KDB Daewoo Securities, as Mirae Asset Management is said to have put in the highest bid.
The chairman called for a meeting of key executives on Dec. 21 and said he will push for the expansion of the earnings ratio of the non-banking sector under a so-called “Plan B” for the new year.
KB Investment and Securities Co., one of the major affiliates of the group, will be a main source in boosting the non-banking sector’s earnings while the group continues to eye a takeover of either a life insurance or securities firm.
The group will also strengthen its Fintech sector operation in the new year with the arrival of the digital finance age. The first step to strengthening the Fintech banking sector would be to improve financial services for the customers using mobile and Internet channels for banking transactions. Likewise, improving the facial recognition technology and systems at KB Kookmin Bank is essential for the company to make a dent in the Fintech area.
The group will also expand the “Starters Valley,” which is designed to train Fintech companies. Chairman Yoon said one of the core items for the group’s strategy is strengthening mobile channels, with the group changing its mobile app., KB Star Banking, early in the month in line with the group’s strategy to strengthen the digital finance sector in the new year. The group will also touch up its management strategy in the coming months to boost the overall performance of its affiliates. The group also expects that its plan to launch the digital financial earnings model will be realized ahead of its rivals when Kakao Bank, which participated in KB Financial’s consortium, officially launches its operations.
Chairman Yoon will give a big push to further globalize the group’s operation this year, which is what he wanted to do when he first arrived at the group early last year. KB Kookmin Bank has not been pushing its globalization plan after taking a big loss from the takeover of BCC, a local bank in Kazakhstan in 2008. The bank’s overseas branches stand at 13, the smallest among rivals such as Shinhan Bank, with 23 branches abroad, KEB Hana Bank with 32, Woori Bank with 24.
The group plans to refurbish its overseas strategy and streamline its existing branches and BCC, particularly in Kazakhstan. The group will make CIB, a local subsidiary in Hong Kong, its Asian hub, with such functions as securing foreign currency funds and investment and provision of loans. The bank will also set up a branch in Gurgaon, India and Hanoi, Vietnam, to expand its international operation outside Southeast Asia.
An official of the group said the problems with BCC in Kazakhstan have been taken care of and the new year is the right time to expand the group’s international operation with a new strategy based on changes in the global financial market brought about by the U.S. interest rate hike, low oil prices and ISIS in the Middle East.
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