KB Financial Group joined the very small group of companies which have recorded 4 trillion won in net profit in 2021 by setting a new profit record.
The financial group will also implement shareholder-friendly policies based on its best-ever business performances.
KB Financial decided to increase its dividend payout ratio from a year ago and cancel about 150 billion won in treasury stocks.
KB Financial announced on Feb. 8 that it racked up 4,409.6 billion won in net profits in 2021. This was an increase of 27.6 from the previous record of 3,455.2 billion won in 2020.
“Our interest income soared in 2021 due to loan growth, domestic and foreign mergers and acquisitions, such as Prudential Life Insurance and Prasac,” a KB Financial Group official explained.
“Our net commission income also ascended on the back of increased competitiveness in the WM and investment banking businesses.”
Currently, the non-banking sector accounts for 42.6 percent of the group’s total net profits.
By affiliate, KB Kookmin Bank and KB Securities net profit rose 12.7 percent and 39.6 percent to 2,590.8 billion won and 594.3 billion won, respectively.
Net profits of KB Insurance hit 301.8 billion won, with a year-on-year increase of 84.1 percent. KB Card posted 4018.9 billion won in net profits, up 29.0 percent from a year before.
However, KB Life Insurance’s deficits expanded from 23.2 billion won to 46.6 billion won in the one-year period.
In the fourth quarter of 2021 alone, KB Financial Group’s net profit reached 637.2 billion won, up 10.4 percent from the fourth quarter of 2020.
However, compared to 1.2981 billion won in the previous third quarter, it nearly halved.
“The decline was blamed on one-time costs and seasonal factors such as voluntary retirement costs (190.2 billion won after tax), future economic prospects, and loan loss provisions (191.5 billion won after tax) related to the COVID-19 situation,” the official explained.
Meanwhile, KB Financial Group held a board meeting prior to the announcement of its earnings and set its dividend payout ratio for 2021 at 26 percent, the level before the outbreak of COVID-19, and decided to cancel 150 billion won worth of treasury stocks.
The dividend per share is 2,940 won, about 66 percent more than in 2021. Considering that 750 won per share was paid earlier in August in 2021, the dividend at the end of the fiscal year hovers around 2,190 won.
“It is an effort to steadily enhance shareholder value even in difficult environments due to the COVID-19 crisis,” the official said with respect to the cancellation of treasury stocks, an official from KB Financial Group.
In the earnings presentation on the day, KB Financial Group selected four issues to address in 2022.
They are weakening non-interest businesses, the possibility of asset soundness deterioration, intensifying platform competition, and fiercer competition in the My Data sector and introduced its strategies in detail.
An executive in charge of financial affairs stressed that KB Financial Group will be able to continue its momentum to improve its performance in 2022 as it is yielding tangible results, focusing on the group’s four key growth drivers - WM, CIB, capital markets and insurance and maintaining a conservative management system for asset soundness.
