Chairman Yoon Jong-kyoo of KB Financial Group is seen with a number of employees on a visit to KB Kookmin Bank. (Photo: KB Bank)

Chairman Yoon Jong-kyoo of KB Financial Group is out to strengthen his understanding of the group’s affiliates by holding one-on-one meetings with affiliate CEOs over breakfast to directly hear what’s going on at the businesses.

He has been having the breakfasts with newly appointed affiliate CEOs, including presidents Park Song-hyun and Kim Sung-hyun of KB Securities, President Hwang Su-nam of KB Capital and President Kim Jong-kyum of KB Real Estate Trust.

The chairman has been explaining to the CEOs the major strategies for 2019, including what the affiliates have to do to cooperate with the group, while at the same time learn the problems that the affiliates might be having to achieving the targets for the year.

One affiliate CEO said he was reluctant to have breakfast with the chairman at first, but he thought the meeting went well. He said he got some helpful mentoring from the chairman, in exchange for updating the chairman’s on what’s going on at his company.

Officials of the group said the chairman thought that the breakfast meetings are better as he and the CEOs can discuss issues concerning their operations in detail, which they couldn’t do at official meetings with affiliate heads and other key executives. The chairman also decided to meet them so as to not to take up their normal working hours.

He will continue the meetings throughout this month, the officials said.
“Just making up the financial targets have been meaningless without the reflection of the operational conditions for the affiliates, the chairman felt obviously,” an official said.

He might hold the early hour meeting once in every two months this year, they said, as he aims to boost the corporate values of the group and its affiliates.

The Group’s key growth strategies are: 1) creating synergies within the Group; 2) digitalization; and 3) globalization. The keywords of the digitalization strategy are “agile,” “customer-centric,” and “efficiency,” with a focus on digital banking and digital platforms. Internet banking users represent 72% of total customers and KB provides three major apps in addition to three minor apps offering specialized services. For globalization, KB’s subsidiaries have selectively chosen the markets where they are competitive: for example, KB Bank opened branches in India; KB Card and Capital in Vietnam and Myanmar; and digital services in Cambodia. For our target price, we applied 0.87x target P/B to 2018F BPS (COE 11.8%, ROE 10.3%).

KB Financial Group Inc., a financial holding company, provides a range of banking and related financial services to consumers and corporations in South Korea and internationally. It operates through Corporate Banking, Retail Banking, Other Banking Services, Securities Business, Non-life Insurance Business, Credit Card Business, and Life Insurance Business segments.

The company offers deposit and credit products and services, and other related financial services to large, small, medium-sized enterprises and SOHOs, and individuals and households; and engages in trading in securities and derivatives, funding, and other supporting activities.

It also provides investment banking, brokerage, and other supporting services; property and life insurance; and credit sale, cash service, and card loan services. In addition, the company offers foreign exchange transaction; financial investment; credit card and installment finance; security investment trust management and advisory; financial leasing; real estate trust management; capital investment; collection of receivables or credit investigation; software advisory, development, and supply; investment advisory and securities dealing; claim; management; asset-backed securitization; investment trust; trust asset management; and real estate services. KB Financial Group Inc. was founded in 2008 and is headquartered in Seoul, South Korea.