(left) KB Securities President Jeon Byeong-jo and President Yoon Kyung-eun.

KB Securities plans to take a giant leap toward the massive expansion of its capital to around 4 trillion won, largely aimed at boosting its 

investment banking operations.

The securities arm of KB Financial Group will seek to set up a beachhead overseas and boost the capital of its Hong Kong local subsidiary by $80 million, bringing its capital to 120 billion won from 29 billion won at the end of last year. The company had a long and hard internal discussion on quadrupling the capital of the Hong Kong subsidiary. 

The center of discussion was that the Hong Kong subsidiary should have enough capital to expand its investment banking activities with KB Securities about to seek its proper roles following the merger with KB Investment Securities and Hyundai Securities, which is to expand the roles of sales and trading. Boosting the capital of its overseas subsidiaries were fundamental to the ambitious plan.

KB Securities Co., Ltd. reported consolidated earnings results for the first quarter of fiscal 2017. For the quarter, the company reported operating revenue of 1,931,681 million won against 1,369,506 million won a year ago. Net operating profit was 141,275 million won against 55,964 million won a year ago. 

Profit before income tax was 146,861 million won against 61,036 million won a year ago. Profit for the period was 108,819 million won against 49,344 million won a year ago. Profit attributable to shareholders of the parent company was 108,819 million won against 49,344 million won a year ago.

The mega investment bank KB Securities was officially launched on Jan. 2 with equity capital of some 4 trillion won ($3.3 billion).

KB Securities, an integrated entity of KB Investment & Securities and Hyundai Securities, held an inauguration ceremony and announced a new vision on the same day. The ceremony was attended by KB Financial Group executives and employees, including Chairman Yoon Jong-gyu.

On Dec. 30 last year, KB Investment & Securities increased its capital to 4.16 trillion won ($3.44 billion) as former Hyundai Securities, a subsidiary of the group, carried out a capital increase of 180 billion won ($148.71 million). Accordingly, the combined unit have over 4 trillion won ($3.3 billion) in capital, a datum point of a mega-sized IB. KB Securities has now secured a balanced competitiveness in all business areas by combining Hyundai Securities competence in business infrastructure and wealth management and KB Investment & Securities IB and wholesale divisions.

KB Securities plans to establish its growth strategies by 2020 by each business division. In particular, the company carried out a reshuffle to make heads of each business division generalize banking and securities sectors in order to create a synergy between banks and securities with the WM and corporate investment banking (ICB) businesses as the center. The integrated firm is also offering “change management” programs for chemical incorporation of employees between the two companies, carrying out strategies to make an integrated achievement early. “We will turn into the nations leading asset management firm by strengthening the WM business division, and promote the sales and trading division as KB Financial Groups product factory,” said KB Securities CEO Yoon Kyung-eun, head of the WM business division.

Head of the IB business division KB Securities CEO Jeon Byeong-jo said, “We will foster the IB division in which we have an edge as an investment IB that provides best corporate solutions, and advance the wholesale business division as an investment partner that offers the best solution and platform to enterprises.” 

A view of the KB Securities building in Yeouido, Seoul.(Photos: KB Securities)