Chairman Yoon Jong-kyoo of KB Financial Group leads the officers and staff of the financial group at a rally to continue to go all-out to make the group to hold on to its leading position in earnings in the financial industry(Photo: KFG)

KB Financial Group’s Net Interest Income (NII) for Q3 reached 564.4 billion won, an increase of 56.2 billion won from the previous quarter.

NII Growth was driven by continued effort to defend margins and solid loan growth (1.6 percent QoQ) despite the policy rate cut in June.

The group’s cumulative ROE and ROA for Q3 rose 126bp and 10bp YoY, respectively, attributable to both lower provisioning costs and reduction in G&A expenses. The group’s earnings from January to September totaled 1.69 trillion won, up 25.2 percent YoY.

The group and bank’s cumulative NIM for Q3 came in at 1.85 percent and 1.57 percent, respectively, down by 7bp YoY each owing to policy rate cuts in 2015. 

The group and bank’s NIM for Q3 remained stable on-quarter, despite a policy rate cut in June, driven by continued efforts to expand lower cost core deposits and higher yielding assets.

At the end of September, the group and bank’s BIS ratio stood at 15.25 percent, 16.37 percent, respectively. The group and bank’s CET1 ratio recorded 13.52 percent and 14.35 percent, respectively, demonstrating the highest level of capital base in the domestic financial industry.

Cumulative and quarterly G&A expenses in Q3 decreased 9.5 percent YoY and 6.9 percent QoQ, respectively, attributable to cost saving efforts and the lack of one-off ERP-related costs.

Cumulative and quarterly provision for credit losses in Q3 declined 18.7 percent on-year and 0.2 percent on-quarter, respectively, despite the one-off provisioning on KCI/D’live (97.8 billion won), backed by continued efforts to stabilize asset quality.

Non-operating income for Q3 decreased 67.8 percent on-quarter, due to the absence of one-off items such as bargain purchase gain (104.9 billion won) resulted from acquiring the treasury shares of Hyundai Securities in Q2.

KB Financial Group, Inc. is a holding company that engages in providing financial services through its subsidiaries. It operates through the following segments: Corporate Banking, Retail Banking, Other Banking Services, Credit Card, Life Insurance, Investment and Securities business. 

The Corporate Banking business segment provides services such as loans, overdrafts, deposits, credit facilities and other foreign currency activities. The Retail Banking business segment offers services such as private customer current accounts, savings, deposits, consumer loans and mortgage loans. 

The Other Banking business segment provides services relating to banking business besides corporate banking and retail banking services. The Credit Card business segment offers services such as domestic as well as overseas credit and debit card operations. The Investment and Securities business segment provides services such as investment banking and brokerage. 

The Life Insurance business segment provides products such as life insurance and wealth management. The company was founded on September 29, 2008 and is headquartered in Seoul, South Korea. KB Financial Group provides services related to corporate governance, corporate information and IR via a website in real time.

 “Following KBFG's integration of KB Insurance as a subsidiary in the previous year, we signed the SPA or share purchase agreement for the acquisition of Hyundai Securities,” the bank said. 

KBFG now has a complete balanced portfolio as a comprehensive financial group. 

“We will do our best to expand synergy through cooperation between subsidiaries in insurance and securities and … our diversified profit base so that we can push up our Group's profitability with stability.” 

In business performance, the quarterly NIM, which was on a long downward track, showed a rebound. Asset quality stably continued and credit costs went down. Overall sound earnings flow continued. 

“Now, the highlights of Q1, first, sound loan growth continued,” according to the bank. “Regardless of the seasonality which leads to a deceleration of loan growth at the beginning of the year, a solid growth trend was maintained in Q1. Corporate loans also grew due to steady demand of the SOHO loans. In Q1, overall won denominated loans grew 1.7 percent. In addition, Group's Q1 NIM recorded 1.84 percent and improved 3 basis points QoQ.”