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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of August 2021
Commission File Number: 000-53445
KB Financial Group Inc.
(Translation of registrant’s name into English)
26, Gukjegeumyung-ro 8-gil, Yeongdeungpo-gu, Seoul 07331, Korea
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
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Summary of 2021 First Half Business Report
On August 17, 2021, KB Financial Group Inc. (“KB Financial Group”) filed its business report for the first half of 2021 (the “Business Report”) with the Financial Services Commission of Korea and the Korea Exchange. This is a summary of the Business Report translated into English.
Except where indicated otherwise, financial information contained in this summary have been prepared in accordance with the Korean equivalent of International Financial Reporting Standards (“K-IFRS”), which differ in certain important respects from generally accepted accounting principles in the United States.
All references to “KB Financial Group,” “we,” “us” or the “Company” are to KB Financial Group and, unless the context requires otherwise, its subsidiaries. In addition, all references to “Won” or “KRW” in this document are to the currency of the Republic of Korea.
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1. Introduction to the Company
KB Financial Group is a financial holding company that was established in September 2008. Its main business purpose is to hold shares in companies that are engaged in financial or related services, as well as govern and manage such companies. Its consolidated subsidiaries are primarily engaged in the banking business, the financial investment business, the insurance business, the credit card business and other related businesses.
• | September 26, 2008 |
Obtained final approval from the Financial Services Commission to establish a financial holding company
• | September 29, 2008 |
Establishment of the Company through a comprehensive stock transfer and listing on the New York Stock Exchange
• | October 10, 2008 |
Listing on the Korea Exchange
• | October 20, 2008 |
The largest shareholder of the Company changed from the Korean National Pension Service to ING Bank N.V.
• | October 31, 2008 |
The largest shareholder of the Company changed from ING Bank N.V. to the Korean National Pension Service
• | May 4, 2009 |
Added Kookmin Bank Cambodia PLC. as a second-tier subsidiary
• | June 22, 2009 |
Added KB Life Insurance Co., Ltd. (“KB Life Insurance”), formerly a second-tier subsidiary, as a first-tier subsidiary
• | July 1, 2009 |
Changed the name of KB Venture Capital Co., Ltd. to KB Investment Co., Ltd. (“KB Investment”)
• | January 22, 2010 |
The largest shareholder of the Company changed from the Korean National Pension Service to ING Bank N.V.
• | March 2, 2011 |
Added KB Kookmin Card Co., Ltd. (“KB Kookmin Card”) as a first-tier subsidiary
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• | March 14, 2011 |
KB Futures Co., Ltd. was merged into KB Investment & Securities Co., Ltd. (“KB Investment & Securities”)
• | July 8, 2011 |
The largest shareholder of the Company changed from ING Bank N.V. to the Korean National Pension Service
• | January 13, 2012 |
Added KB Savings Bank Co., Ltd. (“KB Savings Bank”) as a first-tier subsidiary
• | May 11, 2012 |
Added KoFC POSCO HANWHA KB Shared Growth No. 2. Private Equity Fund as a second-tier subsidiary
• | July 2, 2012 |
Added KoFC Value-up Private Equity Fund as a second-tier subsidiary
• | October 10, 2012 |
Added Kookmin Bank (China) Ltd. as a second-tier subsidiary
• | June 20, 2013 |
Acquired the remaining shares of KB Life Insurance, which increased the Company’s shareholding to 100%
• | September 2, 2013 |
Added Yehansoul Savings Bank as a first-tier subsidiary
• | January 13, 2014 |
Yehansoul Savings Bank was merged into KB Savings Bank
• | March 20, 2014 |
Added KB Capital Co., Ltd. (“KB Capital”) as a first-tier subsidiary
• | June 24, 2015 |
Added KB Insurance Co., Ltd. (“KB Insurance”) as a non-consolidated first-tier subsidiary
• | November 23, 2015 |
Acquired additional shares of KB Insurance, which increased the Company’s shareholding from 19.47% to 33.29%
• | May 31, 2016 |
Added Hyundai Securities Co., Ltd. (“Hyundai Securities”) as a non-consolidated first-tier subsidiary
• | June 21, 2016 |
Disposed of LIG Investment & Securities, Co., Ltd., a second-tier subsidiary
• | June 28, 2016 |
Acquired treasury shares of Hyundai Securities, which increased the Company’s equity ownership in Hyundai Securities from 22.56% to 29.62%
• | December 1, 2016 |
Added KB Golden Life Care Co., Ltd. as a second-tier subsidiary
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• | December 29, 2016 |
Established KB Private Equity Fund III as a second-tier subsidiary
• | December 30, 2016 |
Purchased new shares of KB Insurance in a rights offering, which increased the Company’s shareholding in KB Insurance from 33.29% to 39.81%
• | December 30, 2016 |
Merged KB Investment & Securities with and into Hyundai Securities, with Hyundai Securities as the surviving entity, then changed its name to KB Securities Co., Ltd. (“KB Securities”)
• | February 8, 2017 |
Added KB KOLAO LEASING Co., Ltd. as a second-tier subsidiary
• | March 8, 2017 |
Added KB Microfinance Myanmar Co., Ltd. as a second-tier subsidiary
• | May 19, 2017 |
Acquired additional shares of KB Insurance in a tender offer, which increased the Company’s shareholding in KB Insurance from 39.81% to 94.30%
• | May 19, 2017 |
Acquired additional shares of KB Capital in a tender offer, which increased the Company’s shareholding in KB Capital from 52.02% to 79.70%
• | July 7, 2017 |
Converted KB Insurance and KB Capital into wholly-owned subsidiaries of the Company through comprehensive stock swaps
• | September 29, 2017 |
Added KB Asset Management Singapore Pte. Ltd. as a second-tier subsidiary (changed from a second-tier subsidiary of KB Securities to a first-tier subsidiary of KB Asset Management Co., Ltd.)
• | October 9, 2017 |
Added KB SECURITIES VIETNAM JOINT STOCK COMPANY (formerly MARITIME SECURITIES INCORPORATION) as a second-tier subsidiary
• | October 16, 2017 |
Disposed of Hyundai Savings Bank, Co., Ltd., a second-tier subsidiary
• | December 22, 2017 |
Disposed of Hyundai Asset Management, Co., Ltd., a second-tier subsidiary
• | January 17, 2018 |
Added KB-TS Technology Venture Private Equity Fund as a second-tier subsidiary (equity interests of 16%, 30% and 10% held by KB Securities, Kookmin Bank and KB Capital, respectively)
• | July 6, 2018 |
Added KB Daehan Specialized Bank PLC. as a second-tier subsidiary
• | August 21, 2018 |
Added KBAM Shanghai Advisory Services Co., Ltd. as a second-tier subsidiary
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• | December 31, 2018 |
Added KB-Stonebridge Secondary Private Equity Fund as a second-tier subsidiary
• | January 9, 2019 |
Added KB-SPROTT Renewable Private Equity Fund I as a second-tier subsidiary
• | September 17, 2019 |
Added KB-SP Private Equity Fund IV as a second-tier subsidiary
• | February 28, 2020 |
Added KB-NAU Special Situation Corporate Restructuring Private Equity Fund as a second-tier subsidiary
• | April 10, 2020 |
Added PRASAC Microfinance Institution PLC. as a second-tier subsidiary
• | May 18, 2020 |
Added PT Sunindo Kookmin Best Finance as a second-tier subsidiary
• | July 3, 2020 |
Added PT KB Finansia Multi Finance as a second-tier subsidiary
• | August 31, 2020 |
Added Prudential Life Insurance Company of Korea, Ltd. (“Prudential Life Insurance”) as a first-tier subsidiary
• | September 2, 2020 |
Added PT Bank Bukopin Tbk as a second-tier subsidiary (renamed PT Bank KB Bukopin, Tbk. on February 8, 2021)
• | October 28, 2020 |
Added KB Material and Parts No.1 PEF as a second-tier subsidiary
• | December 4, 2020 |
Added FineKB Private Equity Fund No.1 as a second-tier subsidiary
• | December 16, 2020 |
Added KB FINA JOINT STOCK COMPANY as a second-tier subsidiary
• | December 23, 2020 |
Added KB Bank Myanmar Co., Ltd. as a second-tier subsidiary
• | January 15, 2021 |
Added KB Bio Private Equity Fund III as a second-tier subsidiary
• | January 29, 2021 |
Added J Fintech Co., Ltd. as a second-tier subsidiary (renamed KB J Capital Co., Ltd. on February 16, 2021)
• | March 2, 2021 |
Added PT KB Data Systems Indonesia as a second-tier subsidiary
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1.3. | Overview of the Business Group |
(As of June 30, 2021) | ||||
Type | Name of Company | Controlling Company | ||
Listed | KB Financial Group | — | ||
Listed (Overseas) | PT Bank KB Bukopin, Tbk.1) | Kookmin Bank | ||
Not Listed | Kookmin Bank | KB Financial Group | ||
KB Securities Co., Ltd. | KB Financial Group | |||
KB Insurance Co., Ltd. | KB Financial Group | |||
KB Kookmin Card Co., Ltd. | KB Financial Group | |||
Prudential Life Insurance Company of Korea, Ltd. | KB Financial Group | |||
KB Asset Management Co., Ltd. | KB Financial Group | |||
KB Capital Co., Ltd. | KB Financial Group | |||
KB Life Insurance Co., Ltd. | KB Financial Group | |||
KB Real Estate Trust Co., Ltd. | KB Financial Group | |||
KB Savings Bank Co., Ltd. | KB Financial Group | |||
KB Investment Co., Ltd. | KB Financial Group | |||
KB Data Systems Co., Ltd. | KB Financial Group | |||
KB Credit Information Co., Ltd. | KB Financial Group | |||
Kookmin Bank Cambodia PLC. | Kookmin Bank | |||
Kookmin Bank (China) Ltd. | Kookmin Bank | |||
KB Microfinance Myanmar Co., Ltd. | Kookmin Bank | |||
KB Bank Myanmar Co., Ltd. | Kookmin Bank | |||
PRASAC Microfinance Institution PLC. | Kookmin Bank | |||
KBFG Securities America Inc. | KB Securities | |||
KB Securities Hong Kong Ltd. | KB Securities | |||
Keystone-Hyundai Securities No. 1 Private Equity Fund | KB Securities | |||
KB SECURITIES VIETNAM JOINT STOCK COMPANY | KB Securities | |||
KB-TS Technology Venture Private Equity Fund | KB Securities | |||
KB-Stonebridge Secondary Private Equity Fund | KB Securities | |||
KB-SPROTT Renewable Private Equity Fund I | KB Securities | |||
KB-SP Private Equity Fund IV | KB Securities | |||
KB-NAU Special Situation Corporate Restructuring Private Equity Fund | KB Securities | |||
KB Material and Parts No.1 PEF | KB Securities | |||
KB FINA JOINT STOCK COMPANY | KB Securities | |||
KB Bio Private Equity Fund III | KB Securities | |||
KB Claims Survey & Adjusting Co., Ltd. | KB Insurance | |||
KB Sonbo CNS | KB Insurance | |||
Leading Insurance Services, Inc. | KB Insurance | |||
KBFG Insurance (China) Co., Ltd.2) | KB Insurance | |||
PT. KB Insurance Indonesia | KB Insurance | |||
KB Golden Life Care Co., Ltd. | KB Insurance | |||
KB Daehan Specialized Bank PLC. | KB Kookmin Card | |||
PT KB Finansia Multi Finance | KB Kookmin Card | |||
KB J Capital Co., Ltd.3) | KB Kookmin Card | |||
KB Asset Management Singapore Pte. Ltd. | KB Asset Management | |||
KBAM Shanghai Advisory Services Co., Ltd. | KB Asset Management | |||
KB KOLAO LEASING Co., Ltd. | KB Capital | |||
PT Sunindo Kookmin Best Finance | KB Capital | |||
KoFC POSCO HANWHA KB Shared Growth No. 2. Private Equity Fund | KB Investment | |||
KoFC Value-up Private Equity Fund | KB Investment | |||
FineKB Private Equity Fund No. 1 | KB Investment | |||
PT KB Data Systems Indonesia | KB Data Systems | |||
PT Bukopin Finance | PT Bank KB Bukopin, Tbk. | |||
PT Bank Syariah Bukopin | PT Bank KB Bukopin, Tbk. | |||
Mangrove Master Fund | KB Asset Management Singapore Pte. Ltd. | |||
Mangrove Feeder Fund | KB Asset Management Singapore Pte. Ltd. |
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Notes: | 1) Renamed from PT Bank Bukopin Tbk to PT Bank KB Bukopin, Tbk. on February 8, 2021 upon approval from the Indonesia Financial Services Authority. |
2) Renamed from LIG Insurance (China) Co., Ltd. to KBFG Insurance (China) Co., Ltd. upon completion of registration with the Nanjing Chamber of Commerce on April 9, 2021.
3) Renamed from J Fintech Co., Ltd. to KB J Capital Co., Ltd. upon completion of registration with the Ministry of Commerce of Thailand on February 16, 2021.
1.4.1. Changes in Capital
(Unit: in Won, shares) | ||||||||||||||||||||||||||
Type | As of the end of June 30, 2021 | As of the end of December 31, 2020 | As of the end of December 31, 2019 | As of the end of December 31, 2018 | As of the end of December 31, 2017 | As of the end of December 31, 2016 | ||||||||||||||||||||
Common Shares | Number of Shares Issued | 415,807,920 | 415,807,920 | 415,807,920 | 418,111,537 | 418,111,537 | 418,111,537 | |||||||||||||||||||
Par Value Per Share | 5,000 | 5,000 | 5,000 | 5,000 | 5,000 | 5,000 | ||||||||||||||||||||
Share Capital | 2,090,557,685,000 | 2,090,557,685,000 | 2,090,557,685,000 | 2,090,557,685,000 | 2,090,557,685,000 | | 2,090,557,685,000 | | ||||||||||||||||||
Preferred Shares | Number of Shares Issued | — | — | — | — | — | — | |||||||||||||||||||
Par Value Per Share | — | — | — | — | — | — | ||||||||||||||||||||
Share Capital | — | — | — | — | — | — | ||||||||||||||||||||
Others | Number of Shares Issued | — | — | — | — | — | — | |||||||||||||||||||
Par Value Per Share | — | — | — | — | — | — | ||||||||||||||||||||
Share Capital | — | — | — | — | — | — | ||||||||||||||||||||
Total | Share Capital | 2,090,557,685,000 | 2,090,557,685,000 | 2,090,557,685,000 | 2,090,557,685,000 | 2,090,557,685,000 | 2,090,557,685,000 |
Note: On December 6, 2019, the board of directors of KB Financial Group resolved to cancel 2,303,617 shares of its common stock held as treasury shares, representing an amount equivalent to KRW 100 billion as of such date. While the cancellation of these shares resulted in a decrease in the total number of shares issued above, there was no reduction in share capital since such cancellation was made within the limits of profits available for the payout of dividends.
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1.4.2 Number of Shares
(As of June 30, 2021) | (Unit: shares) | |||||||||||||||
Type | ||||||||||||||||
Common Shares | Preferred Shares | Total | Remarks | |||||||||||||
Shares Authorized for Issuance | 1,000,000,000 | — | 1,000,000,000 | | As specified in the Articles of Incorporation | | ||||||||||
Total Shares Issued (A) | 418,111,537 | — | 418,111,537 | — | ||||||||||||
Decrease in Number of Shares (B) | 2,303,617 | — | 2,303,617 | — | ||||||||||||
1. Capital Reduction | — | — | — | — | ||||||||||||
2. Cancellation | 2,303,617 | — | 2,303,617 | Treasury Shares | ||||||||||||
3. Redemption | — | — | — | — | ||||||||||||
4. Other | — | — | — | — | ||||||||||||
Shares Issued as of June 30, 2021 (C=A-B) | 415,807,920 | — | 415,807,920 | — | ||||||||||||
Treasury Shares (D) | 26,173,585 | — | 26,173,585 | — | ||||||||||||
Shares Outstanding (C-D) | 389,634,335 | — | 389,634,335 | — |
Note: | The treasury shares above include five million treasury shares that the exchangeable bonds issued by the Company on June 30, 2020 can be exchanged for. Such treasury shares are currently deposited with Korea Securities Depositary and will be disposed upon the exercise of the exchange option of the exchangeable bonds. For more information, please refer to the Company’s report on Form 6-K furnished to the Securities and Exchange Commission on June 18, 2020. |
KB Financial Group maintains a progressive dividend policy and aims to gradually increase its payout ratio to 30% in the mid- to long-term. With regard to the acquisition and cancellation of treasury shares, KB Financial Group plans to keep open the possibility of using treasury shares as part of its capital policy in order to enhance shareholder value once market uncertainties, including those related to COVID-19, have been alleviated.
Although KB Financial Group had continued to increase its payout ratio, for example, from 24.8% in 2018 to 26.0% in 2019, KB Financial Group decided to limit its payout ratio for 2020 to 20%, pursuant to the Financial Services Commission’s recommendation for Korean banks to temporarily limit the payout ratio to 20% in consideration of circumstances related to the COVID-19 pandemic, which decision was deemed unavoidable at the time. On June 25, 2021, the Financial Services Commission officially announced the lifting of its recommendation to limit the payout of dividends, and following such announcement, KB Financial Group, for the first time in its history, declared an interim quarterly cash dividend of Won 750 per share. KB Financial Group will continue to strive to improve its shareholder value by pursuing various shareholder return policies, such as making regular payments of quarterly dividends, increasing the total dividend amount and acquiring and/or cancelling treasury shares.
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(Unit: in millions of Won, except per share amounts) | ||||||||||||||||
Classification | Type | January 1, 2021 to June 30, 2021 | January 1, 2020 to December 31, 2020 | January 1, 2019 to December 31, 2019 | ||||||||||||
Par value per share (Won) | 5,000 | 5,000 | 5,000 | |||||||||||||
(Consolidated) Net Income | 2,474,291 | 3,455,151 | 3,311,828 | |||||||||||||
(Consolidated) Earnings per share (Won) | 6,270 | 8,809 | 8,451 | |||||||||||||
Total cash dividends | 292,226 | 689,653 | 861,092 | |||||||||||||
Total stock dividends | — | — | — | |||||||||||||
(Consolidated) Cash dividend payout | 11.8 | 20.0 | 26.0 | |||||||||||||
Cash dividend yield (%) | Common Shares | 1.3 | 3.9 | 4.5 | ||||||||||||
— | — | — | — | |||||||||||||
Stock dividend yield (%) | Common Shares | — | — | — | ||||||||||||
— | — | — | — | |||||||||||||
Cash dividend per share (Won) | Common Shares | 750 | 1,770 | 2,210 | ||||||||||||
— | — | — | — | |||||||||||||
Stock dividend per share | Common Shares | — | — | — | ||||||||||||
— | — | — | — |
1.6. Amendments to the Articles of Incorporation
Date | Shareholder meeting through which | Major changes | Notes | |||
March 20, 2020 | Annual General Meeting of Shareholders for Fiscal Year 2019 | Establishment of the ESG committee within the board of directors through the amendment of article 48 | To establish a basis for creating a new committee within the board of directors | |||
March 27, 2019 | Annual General Meeting of Shareholders for Fiscal Year 2018 | Establishment of a basis for the electronic registration of shares and bonds, and modification of the processing activities of transfer agents through the amendment of articles 9, 16, 17, 19 and 22 | Pursuant to the Act on Electronic Registration of Stocks, Bonds, Etc. (Effective as of September 2019) | |||
March 23, 2018 | Annual General Meeting of Shareholders for Fiscal Year 2017 | Partition of the corporate governance committee according to its different functions, and implementation of changes in the appointment process of the external auditors and in the shareholder meeting through which such changes must be reported, through the amendment of articles 48, 52, 55 and 56 | To establish a basis for creating and abolishing committees within the board of directors; and Pursuant to the Act on the External Audit of Stock Companies, Etc. (Effective as of November 2018) |
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(Unit: in millions of Won) | ||||||||||||||||
For the six months ended June 30, 2021 | For the six months ended June 30, 2020 | For the year ended December 31, 2020 | For the year ended December 31, 2019 | |||||||||||||
Net interest income | 5,401,073 | 4,683,248 | 9,722,274 | 9,196,787 | ||||||||||||
Interest income | 7,312,653 | 7,221,747 | 14,485,747 | 14,639,187 | ||||||||||||
Interest expense | (1,911,580 | ) | (2,538,499 | ) | (4,763,473 | ) | (5,442,400 | ) | ||||||||
Net fee and commission income | 1,832,599 | 1,381,314 | 2,958,939 | 2,355,004 | ||||||||||||
Fee and commission income | 2,653,787 | 2,135,370 | 4,527,024 | 3,879,247 | ||||||||||||
Fee and commission expense | (821,188 | ) | (754,056 | ) | (1,568,085 | ) | (1,524,243 | ) | ||||||||
Net insurance income | 335,916 | 180,456 | 299,993 | 299,512 | ||||||||||||
Insurance income | 8,259,937 | 6,837,454 | 14,386,640 | 12,317,182 | ||||||||||||
Insurance expense | (7,924,021 | ) | (6,656,998 | ) | (14,086,647 | ) | (12,017,670 | ) | ||||||||
Net gains on financial assets/liabilities at fair value through profit or loss | 517,761 | 234,718 | 1,011,366 | 643,872 | ||||||||||||
Net other operating expenses | (877,006 | ) | (464,808 | ) | (1,499,930 | ) | (1,063,324 | ) | ||||||||
General and administrative expenses | (3,392,609 | ) | (3,045,606 | ) | (6,833,152 | ) | (6,271,017 | ) | ||||||||
Operating profit before provision for credit losses | 3,817,734 | 2,969,322 | 5,659,490 | 5,160,834 | ||||||||||||
Provision for credit losses | (397,160 | ) | (539,748 | ) | (1,043,498 | ) | (670,185 | ) | ||||||||
Net operating profit | 3,420,574 | 2,429,574 | 4,615,992 | 4,490,649 |
Note: | Based on K-IFRS (on a consolidated basis). |
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2.2. | Sources and Uses of Funds |
2.2.1. | Sources of Funds |
(Unit: in millions of Won) | ||||||||||||||||||||||||||||||||||||||
For the six months ended June 30, 2021 | For the year ended December 31, 2020 | For the year ended December 31, 2019 | ||||||||||||||||||||||||||||||||||||
Average Balance | Interest Rate (%) | Ratio (%) | Average Balance | Interest Rate (%) | Ratio (%) | Average Balance | Interest Rate (%) | Ratio (%) | ||||||||||||||||||||||||||||||
Deposits | 302,196,068 | 0.75 | 49.29 | 286,168,968 | 1.07 | 50.88 | 255,533,447 | 1.44 | 52.09 | |||||||||||||||||||||||||||||
Certificate of deposit | 3,028,005 | 0.79 | 0.49 | 3,635,870 | 1.37 | 0.65 | 4,780,665 | 1.95 | 0.97 | |||||||||||||||||||||||||||||
Won Currency | Borrowings | 23,152,043 | 0.91 | 3.78 | 17,330,480 | 1.20 | 3.08 | 11,332,972 | 1.67 | 2.31 | ||||||||||||||||||||||||||||
Call money | 1,199,227 | 0.50 | 0.20 | 1,617,841 | 0.65 | 0.29 | 891,357 | 1.55 | 0.18 | |||||||||||||||||||||||||||||
Debentures | 57,162,707 | 1.79 | 9.32 | 52,843,837 | 2.02 | 9.39 | 47,127,572 | 2.33 | 9.61 | |||||||||||||||||||||||||||||
Others | 20,932,343 | 0.76 | 3.42 | 19,792,619 | 1.01 | 3.52 | 15,203,562 | 1.88 | 3.11 | |||||||||||||||||||||||||||||
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Subtotal | 407,670,393 | 0.91 | 66.50 | 381,389,615 | 1.21 | 67.81 | 334,869,575 | 1.60 | 68.27 | |||||||||||||||||||||||||||||
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Foreign Currency | Deposits | 25,132,476 | 1.75 | 4.10 | 20,488,109 | 1.46 | 3.64 | 13,370,035 | 1.25 | 2.73 | ||||||||||||||||||||||||||||
Borrowings | 12,076,605 | 1.28 | 1.97 | 12,071,802 | 1.81 | 2.15 | 9,668,310 | 2.19 | 1.97 | |||||||||||||||||||||||||||||
Call money | 668,406 | 1.17 | 0.11 | 976,153 | 0.97 | 0.17 | 527,809 | 2.34 | 0.11 | |||||||||||||||||||||||||||||
Debentures | 6,672,814 | 1.76 | 1.09 | 6,535,922 | 1.84 | 1.16 | 5,447,017 | 2.62 | 1.11 | |||||||||||||||||||||||||||||
Others | 1,962,011 | 1.03 | 0.32 | 1,126,379 | 1.12 | 0.20 | 463,266 | 1.38 | 0.09 | |||||||||||||||||||||||||||||
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Subtotal | 46,512,312 | 1.59 | 7.59 | 41,198,365 | 1.60 | 7.32 | 29,476,437 | 1.83 | 6.01 | |||||||||||||||||||||||||||||
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Others | Total shareholders’ equity | 44,955,581 | — | 7.33 | 41,495,072 | — | 7.38 | 38,464,863 | — | 7.84 | ||||||||||||||||||||||||||||
Allowances | 998,549 | — | 0.16 | 912,721 | — | 0.16 | 873,017 | — | 0.18 | |||||||||||||||||||||||||||||
Others | 112,905,183 | — | 18.42 | 97,476,975 | — | 17.33 | 86,839,627 | — | 17.70 | |||||||||||||||||||||||||||||
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Subtotal | 158,859,313 | — | 25.91 | 139,884,768 | — | 24.87 | 126,177,507 | — | 25.72 | |||||||||||||||||||||||||||||
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Total | 613,042,018 | — | 100.00 | 562,472,748 | — | 100.00 | 490,523,519 | — | 100.00 | |||||||||||||||||||||||||||||
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|
Note: | Based on K-IFRS (on a consolidated basis). |
Table of Contents
2.2.2. | Uses of Funds |
(Unit: in millions of Won) | ||||||||||||||||||||||||||||||||||||||
For the six months ended June 30, 2021 | For the year ended December 31, 2020 | For the year ended December 31, 2019 | ||||||||||||||||||||||||||||||||||||
Average Balance | Interest Rate (%) | Ratio (%) | Average Balance | Interest Rate (%) | Ratio (%) | Average Balance | Interest Rate (%) | Ratio (%) | ||||||||||||||||||||||||||||||
Won Currency | Due from banks | 15,025,025 | 0.28 | 2.45 | 7,400,343 | 0.67 | 1.32 | 5,939,242 | 1.51 | 1.21 | ||||||||||||||||||||||||||||
Securities | 143,716,342 | 1.37 | 23.44 | 125,573,646 | 1.97 | 22.33 | 103,204,928 | 2.31 | 21.04 | |||||||||||||||||||||||||||||
Loans | 330,958,791 | 2.78 | 53.99 | 315,871,106 | 2.98 | 56.16 | 287,653,938 | 3.45 | 58.64 | |||||||||||||||||||||||||||||
Guarantee payments under payment guarantee | 7,011 | 0.51 | — | 13,421 | 0.73 | — | 8,803 | 0.98 | — | |||||||||||||||||||||||||||||
Call loan | 735,069 | 0.57 | 0.12 | 885,951 | 0.73 | 0.16 | 640,485 | 1.69 | 0.13 | |||||||||||||||||||||||||||||
Private placement corporate bonds | 1,029,460 | 2.86 | 0.17 | 1,264,212 | 3.98 | 0.22 | 1,319,460 | 3.61 | 0.27 | |||||||||||||||||||||||||||||
Credit cards | 19,418,926 | 7.20 | 3.17 | 18,560,207 | 7.57 | 3.30 | 17,945,697 | 7.92 | 3.66 | |||||||||||||||||||||||||||||
Others | 4,196,492 | 6.10 | 0.68 | 4,614,823 | 5.04 | 0.82 | 3,874,774 | 4.93 | 0.79 | |||||||||||||||||||||||||||||
Allowance | (2,464,680 | ) | — | (0.40 | ) | (2,416,823 | ) | — | (0.43 | ) | (2,406,757 | ) | — | (0.49 | ) | |||||||||||||||||||||||
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| |||||||||||||||||||||
Subtotal | 512,622,436 | 2.51 | 83.62 | 471,766,886 | 2.89 | 83.88 | 418,180,570 | 3.36 | 85.25 | |||||||||||||||||||||||||||||
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| |||||||||||||||||||||
Foreign Currency | Due from banks | 6,077,235 | 0.48 | 0.99 | 6,989,553 | 0.64 | 1.24 | 4,782,706 | 1.44 | 0.98 | ||||||||||||||||||||||||||||
Securities | 15,332,692 | 3.28 | 2.50 | 15,131,521 | 3.87 | 2.69 | 13,323,102 | 4.35 | 2.72 | |||||||||||||||||||||||||||||
Loans | 24,697,028 | 5.22 | 4.03 | 19,818,889 | 4.30 | 3.52 | 11,384,009 | 3.04 | 2.32 | |||||||||||||||||||||||||||||
Call loan | 2,887,033 | 0.49 | 0.47 | 3,149,433 | 0.82 | 0.56 | 2,444,020 | 2.59 | 0.50 | |||||||||||||||||||||||||||||
Bills bought | 1,775,778 | 0.72 | 0.29 | 1,573,725 | 1.48 | 0.28 | 2,944,008 | 2.66 | 0.60 | |||||||||||||||||||||||||||||
Allowance | (968,068 | ) | — | (0.16 | ) | (404,041 | ) | — | (0.07 | ) | (180,649 | ) | — | (0.04 | ) | |||||||||||||||||||||||
Others | 2,334,155 | — | 0.38 | 1,294,119 | — | 0.22 | 660,572 | — | 0.13 | |||||||||||||||||||||||||||||
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| |||||||||||||||||||||
Subtotal | 52,135,853 | 3.56 | 8.50 | 47,553,199 | 3.24 | 8.44 | 35,357,768 | 3.28 | 7.21 | |||||||||||||||||||||||||||||
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| |||||||||||||||||||||
Others | Cash | 2,007,947 | — | 0.33 | 1,889,892 | — | 0.34 | 1,763,413 | — | 0.36 | ||||||||||||||||||||||||||||
Fixed assets held for business | 8,143,740 | — | 1.33 | 8,048,120 | — | 1.43 | 7,398,134 | — | 1.51 | |||||||||||||||||||||||||||||
Others | 38,132,042 | — | 6.22 | 33,214,651 | — | 5.91 | 27,823,634 | — | 5.67 | |||||||||||||||||||||||||||||
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| |||||||||||||||||||||
Subtotal | 48,283,729 | — | 7.88 | 43,152,663 | — | 7.68 | 36,985,181 | — | 7.54 | |||||||||||||||||||||||||||||
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|
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|
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|
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|
|
| |||||||||||||||||||||
Total | 613,042,018 | — | 100.00 | 562,472,748 | — | 100.00 | 490,523,519 | — | 100.00 | |||||||||||||||||||||||||||||
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Note: | Based on K-IFRS (on a consolidated basis). |
Table of Contents
2.3. | Other Information to Consider in Making an Investment Decision |
2.3.1. | Capital Adequacy |
KB Financial Group | (Unit: in billions of Won, except percentages) | |||||||||||
As of June 30, 2021(1) | As of December 31, 2020(1) | As of December 31, 2019 | ||||||||||
Total capital (A) | 43,361 | 40,080 | 36,995 | |||||||||
Risk-weighted assets (B) | 270,418 | 262,349 | 255,549 | |||||||||
BIS ratio (A/B) | 16.03 | % | 15.28 | % | 14.48 | % |
Notes: Calculated in accordance with Basel III. The figures as of June 30, 2021 are provisional.
(1) | Calculated in accordance with the early adoption of the Basel III Credit Risk Framework. |
Kookmin Bank | (Unit: in billions of Won, except percentages) | |||||||||||
As of June 30, 2021(1) | As of December 31, 2020(1) | As of December 31, 2019 | ||||||||||
Total capital (A) | 34,710 | 32,555 | 29,810 | |||||||||
Risk-weighted assets (B) | 183,446 | 183,148 | 188,075 | |||||||||
BIS ratio (A/B) | 18.92 | % | 17.78 | % | 15.85 | % |
Notes: Calculated in accordance with Basel III.
(1) | Calculated in accordance with the early adoption of the Basel III Credit Risk Framework. |
KB Securities Co., Ltd. | (Unit: in billions of Won, except percentages) | |||||||||||
As of June 30, 2021 | As of December 31, 2020 | As of December 31, 2019 | ||||||||||
Net operating capital (A) | 3,779 | 3,656 | 3,170 | |||||||||
Total amount at risk (B) | 1,801 | 1,678 | 1,561 | |||||||||
Maintenance equity margin (C) | 134 | 134 | 134 | |||||||||
Net capital ratio (A-B)/(C) | 1,473.43 | % | 1,474.14 | % | 1,198.74 | % | ||||||
Capital surplus (A-B) | 1,978 | 1,979 | 1,609 |
KB Insurance Co., Ltd. | (Unit: in billions of Won, except percentages) | |||||||||||
As of June 30, 2021 | As of December 31, 2020 | As of December 31, 2019 | ||||||||||
Available capital (A) | 4,140 | 3,812 | 3,657 | |||||||||
Required capital (B) | 2,316 | 2,181 | 2,005 | |||||||||
RBC ratio (A/B) | 178.7 | % | 174.8 | % | 182.4 | % |
Note: | RBC ratio: Risk-Based Capital ratio. The figures as of June 30, 2021 are provisional. |
Table of Contents
2.3.2. | Overseas Credit Ratings |
(As of June 30, 2021) | ||||||||
Rating Company | Moody’s | S&P | ||||||
Type | Long-term | Short-term | Long-term | Short-term | ||||
Credit Rating | A1 | P-1 | A | A-1 |
2.3.3. | Domestic Credit Ratings |
Date of | Type | Credit Rating | Rating Company (Rating Range) | |||
2/21/2019 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
4/8/2019 | Contingent Convertible Bonds | AA- | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
6/18/2019 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
6/26/2019 | Commercial Paper | A1 | Korea Ratings (A1 ~ D) / KIS Ratings (A1 ~ D) / NICE Investors Service (A1 ~ D) | |||
10/14/2019 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
12/3/2019 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
1/15/2020 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
2/12/2020 | Contingent Convertible Bonds | AA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
3/24/2020 | Contingent Convertible Bonds | AA- | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
5/12/2020 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
6/12/2020 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
6/26/2020 | Commercial Paper | A1 | Korea Ratings (A1 ~ D) / KIS Ratings (A1 ~ D) / NICE Investors Service (A1 ~ D) | |||
7/1/2020 | Contingent Convertible Bonds | AA- | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
8/6/2020 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
10/6/2020 | Contingent Convertible Bonds | AA- | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
11/19/2020 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
1/12/2021 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
2/3/2021 | Contingent Convertible Bonds | AA- | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
2/19/2021 | Debentures | AAA | KIS Ratings (AAA ~ D) | |||
2/22/2021 | Debentures | AAA | Korea Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
5/14/2021 | Contingent Convertible Bonds | AA- | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
6/25/2021 | Commercial Paper | A1 | Korea Ratings (A1 ~ D) / KIS Ratings (A1 ~ D) / NICE Investors Service (A1 ~ D) |
Table of Contents
2.3.4. | Early Retirement Program |
To enhance productivity by improving its labor structure, Kookmin Bank has implemented voluntary early retirement programs following negotiations with its labor union.
Date of Retirement | Number of Retired Persons | |
January 19, 2018 | 407 | |
January 28, 2019 | 615 | |
January 20, 2020 | 462 | |
January 30, 2021 | 800 |
2.3.5. | Acquisition of Shares of PT Bank Bukopin Tbk |
On July 30, 2020, Kookmin Bank acquired 2,967,600,372 additional common shares of PT Bank Bukopin Tbk (“Bank Bukopin”) for IDR 534,168,066,960 (Won 43,909 million) through a shareholder-allocated capital increase. Subsequently, on September 2, 2020, Kookmin Bank acquired 16,360,578,947 additional common shares for IDR 3,108,509,999,930 (Won 252,721 million) through a third party-allocated capital increase. Following such acquisitions, Kookmin Bank’s ownership in Bank Bukopin is as follows:
(Unit: in millions of Won) | ||
Ownership | Acquisition Amount | |
67% | 420,000(1)(2) (IDR 5,146,832,211,231) |
Notes: | (1) The acquisition amount in IDR is converted to Won at the exchange rate on each of the respective acquisition dates. |
(2) Includes consulting fees of Won 10,296 million paid in connection with the acquisition. |
On February 8, 2021, Bank Bukopin changed its name to PT Bank KB Bukopin, Tbk. with approval from the Indonesia Financial Services Authority.
2.3.6. | Acquisition of Shares of PRASAC Microfinance Institution PLC. of Cambodia |
On April 10, 2020, Kookmin Bank acquired 70% of the total number of shares of PRASAC Microfinance Institution PLC. (“PRASAC”), a provider of microfinance and deposit-taking services in Cambodia, for USD 603 million, and has since incorporated PRASAC as a subsidiary. A put option may be exercised by PRASAC’s current shareholders to sell the remaining 30% of PRASAC’s shares to Kookmin Bank. The exercise price of such put option will be determined based on the adjusted book value of PRASAC as of December 31, 2021 as reflected in the audit report of PRASAC’s financial statements as of and for the year ended December 31, 2021, and such put option may be exercised during the six months following the date of such audit report. If PRASAC’s shareholders do not exercise such put option, Kookmin Bank may exercise a call option to purchase the remaining 30% of PRASAC’s shares, and such call option may be exercised during the six months following the expiry of the put option held by PRASAC’s shareholders. The right to buy, sell, pledge or exercise any influence over the remaining 30% of PRASAC’s shares will be limited prior to the exercise of such put or call option.
(Unit: in millions of Won) | ||
Ownership | Acquisition Amount | |
70% | 737,003(1)(2) (USD 603,400,000) |
Notes: | (1) The acquisition amount in USD is converted to Won at the exchange rate on April 10, 2020, the acquisition date. |
(2) Includes consulting fees of Won 3,027 million paid in connection with the acquisition. |
Table of Contents
2.3.7. | The Ongoing COVID-19 Global Pandemic |
The ongoing COVID-19 global pandemic continued to cause significant global and domestic economic and financial disruptions in the first half of 2021. Although there have been some signs of recovery resulting from the availability of COVID-19 vaccinations and gradual normalization of business activities, the economic outlook for Korea and its financial services sector in the remainder of 2021 and for the foreseeable future continues to remain highly uncertain as a result of, among others, (i) uncertainty regarding the scope and duration of the COVID-19 pandemic, particularly given the recent spread of the highly contagious Delta variant and the resurgence of COVID-19 cases in Korea, and its lasting social, political and economic effects, and the fiscal and monetary policies being implemented by the Korean government and regulatory authorities to alleviate such effects, (ii) adverse conditions in the Korean and global economies and financial markets due to the COVID-19 pandemic and (iii) factors such as fluctuations in oil and commodity prices and interest and exchange rates, higher unemployment, lower consumer confidence, higher inflation and stock market volatility due to the impact of the COVID-19 pandemic.
Table of Contents
3. | Financial Information |
3.1. | Consolidated Financial Information |
3.1.1. | Consolidated Statements of Financial Position |
(Unit: in millions of Won) | ||||||||||||
As of June 30, 2021 | As of December 31, 2020 | As of December 31, 2019 | ||||||||||
Cash and due from financial institutions | 24,436,938 | 25,608,842 | 20,837,878 | |||||||||
Financial assets at fair value through profit or loss | 64,981,606 | 61,035,455 | 53,549,086 | |||||||||
Derivative financial assets | 3,176,050 | 5,545,385 | 3,190,673 | |||||||||
Loans at amortized cost | 395,432,000 | 377,166,984 | 339,684,059 | |||||||||
Financial investments | 99,349,197 | 98,695,426 | 71,782,606 | |||||||||
Investments in associates and joint ventures | 458,900 | 771,435 | 598,240 | |||||||||
Property and equipment | 5,257,562 | 5,433,554 | 5,067,377 | |||||||||
Investment property | 2,581,633 | 2,533,539 | 2,827,988 | |||||||||
Intangible assets | 3,275,763 | 3,351,133 | 2,737,813 | |||||||||
Net defined benefit assets | 402 | 2,845 | 946 | |||||||||
Current income tax assets | 66,659 | 109,772 | 19,095 | |||||||||
Deferred income tax assets | 94,387 | 65,058 | 3,597 | |||||||||
Assets held for sale | 216,469 | 197,727 | 23,151 | |||||||||
Other assets | 34,420,209 | 30,155,037 | 18,215,608 | |||||||||
Total assets | 633,747,775 | 610,672,192 | 518,538,117 | |||||||||
Financial liabilities at fair value through profit or loss | 11,757,331 | 11,810,058 | 15,368,153 | |||||||||
Derivative financial liabilities | 2,841,379 | 5,222,897 | 3,007,341 | |||||||||
Deposits | 348,403,321 | 338,580,220 | 305,592,771 | |||||||||
Debts | 53,259,540 | 49,827,156 | 37,818,860 | |||||||||
Debentures | 63,911,374 | 62,760,687 | 50,935,583 | |||||||||
Provisions | 726,306 | 714,903 | 527,929 | |||||||||
Net defined benefit liabilities | 333,586 | 248,226 | 253,989 | |||||||||
Current income tax liabilities | 541,643 | 764,981 | 432,431 | |||||||||
Deferred income tax liabilities | 1,255,234 | 1,162,286 | 777,793 | |||||||||
Insurance contract liabilities | 56,115,450 | 54,415,296 | 34,966,683 | |||||||||
Other liabilities | 48,877,220 | 41,804,023 | 29,737,259 | |||||||||
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|
|
| |||||||
Total liabilities | 588,022,384 | 567,310,733 | 479,418,792 | |||||||||
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Table of Contents
As of June 30, 2021 | As of December 31, 2020 | As of December 31, 2019 | ||||||||||
Equity attributable to shareholders of the parent company | 44,825,329 | 42,503,676 | 38,533,918 | |||||||||
Share capital | 2,090,558 | 2,090,558 | 2,090,558 | |||||||||
Hybrid financial instrument | 2,569,919 | 1,695,988 | 399,205 | |||||||||
Capital surplus | 16,723,564 | 16,723,589 | 17,122,777 | |||||||||
Accumulated other comprehensive income | 501,595 | 612,337 | 348,021 | |||||||||
Retained earnings | 24,075,881 | 22,517,392 | 19,709,545 | |||||||||
Treasury shares | (1,136,188 | ) | (1,136,188 | ) | (1,136,188 | ) | ||||||
Non-controlling interests | 900,062 | 857,783 | 585,407 | |||||||||
Total equity | 45,725,391 | 43,361,459 | 39,119,325 | |||||||||
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|
|
|
| |||||||
Total liabilities and equity | 633,747,775 | 610,672,192 | 518,538,117 | |||||||||
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Table of Contents
3.1.2. | Consolidated Statements of Comprehensive Income |
(Unit: in millions of Won, except per share amounts) | ||||||||||||||||
For the six months ended June 30, 2021 | For the six months ended June 30, 2020 | For the year ended December 31, 2020 | For the year ended December 31, 2019 | |||||||||||||
Net interest income | 5,401,073 | 4,683,248 | 9,722,274 | 9,196,787 | ||||||||||||
Net fee and commission income | 1,832,599 | 1,381,314 | 2,958,939 | 2,355,004 | ||||||||||||
Net insurance income | 335,916 | 180,456 | 299,993 | 299,512 | ||||||||||||
Net gains on financial assets/liabilities at fair value through profit or loss | 517,761 | 234,718 | 1,011,366 | 643,872 | ||||||||||||
Net other operating expenses | (877,006 | ) | (464,808 | ) | (1,499,930 | ) | (1,063,324 | ) | ||||||||
General and administrative expenses | (3,392,609 | ) | (3,045,606 | ) | (6,833,152 | ) | (6,271,017 | ) | ||||||||
Operating profit before provision for credit losses | 3,817,734 | 2,969,322 | 5,659,490 | 5,160,834 | ||||||||||||
Provision for credit losses | (397,160 | ) | (539,748 | ) | (1,043,498 | ) | (670,185 | ) | ||||||||
Net operating income | 3,420,574 | 2,429,574 | 4,615,992 | 4,490,649 | ||||||||||||
Net non-operating income(loss) | 32,774 | (33,972 | ) | 145,640 | 43,337 | |||||||||||
Profit before income tax | 3,453,348 | 2,395,602 | 4,761,632 | 4,533,986 | ||||||||||||
Income tax expense | (960,765 | ) | (664,188 | ) | (1,259,351 | ) | (1,220,787 | ) | ||||||||
Profit for the period | 2,492,583 | 1,731,414 | 3,502,281 | 3,313,199 | ||||||||||||
Other comprehensive income (loss) for the period, net of tax | (296,841 | ) | 179,881 | 475,319 | 152,023 | |||||||||||
Total comprehensive income for the period | 2,195,742 | 1,911,295 | 3,977,600 | 3,465,222 | ||||||||||||
Profit attributable to: | 2,492,583 | 1,731,414 | 3,502,281 | 3,313,199 | ||||||||||||
Shareholders of the parent company | 2,474,291 | 1,711,340 | 3,455,151 | 3,311,828 | ||||||||||||
Non-controlling interests | 18,292 | 20,074 | 47,130 | 1,371 | ||||||||||||
Total comprehensive income for the period attributable to: | 2,195,742 | 1,911,295 | 3,977,600 | 3,465,222 | ||||||||||||
Shareholders of the parent company | 2,168,744 | 1,894,163 | 3,956,113 | 3,463,567 | ||||||||||||
Non-controlling interests | 26,998 | 17,132 | 21,487 | 1,655 | ||||||||||||
Earnings per share | ||||||||||||||||
Basic earnings per share (Won) | 6,270 | 4,375 | 8,809 | 8,451 | ||||||||||||
Diluted earnings per share (Won) | 6,140 | 4,340 | 8,697 | 8,389 |
Table of Contents
3.2. | Separate Financial Information |
3.2.1. | Separate Statements of Financial Position |
(Unit: in millions of Won) | ||||||||||||
As of June 30, 2021 | As of December 31, 2020 | As of December 31, 2019 | ||||||||||
Cash and due from financial institutions | 120,801 | 23,084 | 18,537 | |||||||||
Financial assets at fair value through profit or loss | 1,481,750 | 474,262 | 413,909 | |||||||||
Loans at amortized cost | 179,536 | 179,542 | 120,000 | |||||||||
Investments in subsidiaries | 26,539,149 | 26,519,880 | 24,162,116 | |||||||||
Property and equipment | 6,619 | 7,730 | 4,170 | |||||||||
Intangible assets | 13,927 | 13,267 | 11,092 | |||||||||
Deferred income tax assets | 4,115 | 3,189 | 7,526 | |||||||||
Other assets | 713,035 | 887,537 | 609,286 | |||||||||
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| |||||||
Total assets | 29,058,932 | 28,108,491 | 25,346,636 | |||||||||
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|
| |||||||
Debts | — | 100,000 | — | |||||||||
Debentures | 5,850,039 | 6,128,043 | 5,543,446 | |||||||||
Net defined benefit liabilities | 1,164 | 59 | 437 | |||||||||
Current income tax liabilities | 493,482 | 716,473 | 417,414 | |||||||||
Other liabilities | 223,687 | 178,296 | 203,440 | |||||||||
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|
| |||||||
Total liabilities | 6,568,372 | 7,122,871 | 6,164,737 | |||||||||
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|
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|
| |||||||
Share capital | 2,090,558 | 2,090,558 | 2,090,558 | |||||||||
Hybrid financial instrument | 2,569,694 | 1,695,778 | 399,085 | |||||||||
Capital surplus | 14,754,747 | 14,754,747 | 14,742,814 | |||||||||
Accumulated other comprehensive loss | (8,076 | ) | (8,032 | ) | (7,664 | ) | ||||||
Retained earnings | 4,219,825 | 3,588,757 | 3,093,294 | |||||||||
Treasury Shares | (1,136,188 | ) | (1,136,188 | ) | (1,136,188 | ) | ||||||
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|
| |||||||
Total equity | 22,490,560 | 20,985,620 | 19,181,899 | |||||||||
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|
|
| |||||||
Total liabilities and equity | 29,058,932 | 28,108,491 | 25,346,636 | |||||||||
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3.2.2. | Separate Statements of Comprehensive Income |
(Unit: in millions of Won, except per share amounts) | ||||||||||||||||
For the six months ended June 30, 2021 | For the six months ended June 30, 2020 | For the year ended December 31, 2020 | For the year ended December 31, 2019 | |||||||||||||
Net interest expense | (59,163 | ) | (60,371 | ) | (124,393 | ) | (118,045 | ) | ||||||||
Net fee and commission expense | (4,771 | ) | (3,819 | ) | (8,338 | ) | (6,283 | ) | ||||||||
Net gains on financial assets at fair value through profit or loss | 11,353 | 6,332 | 12,663 | 15,947 | ||||||||||||
Net other operating income | 1,447,949 | 974,930 | 1,571,239 | 926,934 | ||||||||||||
General and administrative expenses | (44,061 | ) | (31,466 | ) | (71,854 | ) | (71,171 | ) | ||||||||
Operating profit before provision for credit losses | 1,351,307 | 885,606 | 1,379,317 | 747,382 | ||||||||||||
Provision for credit losses | (5 | ) | — | (465 | ) | — | ||||||||||
Operating profit | 1,351,302 | 885,606 | 1,378,852 | 747,382 | ||||||||||||
Net non-operating income(loss) | (148 | ) | 162 | 514 | (541 | ) | ||||||||||
Profit before income tax | 1,351,154 | 885,768 | 1,379,366 | 746,841 | ||||||||||||
Income tax income(expense) | 909 | (5,747 | ) | 49 | (854 | ) | ||||||||||
Profit for the period | 1,352,063 | 880,021 | 1,379,415 | 745,987 | ||||||||||||
Other comprehensive income (loss) for the period, net of tax | (44 | ) | (38 | ) | (368 | ) | (520 | ) | ||||||||
Total comprehensive income for the period | 1,352,019 | 879,983 | 1,379,047 | 745,467 | ||||||||||||
Earnings per share | ||||||||||||||||
Basic earnings per share (Won) | 3,390 | 2,242 | 3,482 | 1,891 | ||||||||||||
Diluted earnings per share (Won) | 3,321 | 2,224 | 3,438 | 1,877 |
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3.3. | Other Selected Financial Data |
3.3.1. | Won-denominated Liquidity Ratio |
(Unit: in millions of Won, except percentages) | ||||||||||||
As of June 30, 2021 | As of December 31, 2020 | As of December 31, 2019 | ||||||||||
Current assets in Won (A) | 1,175,372 | 112,754 | 142,683 | |||||||||
Current liabilities in Won (B) | 194,109 | 92,328 | 110,398 | |||||||||
Liquidity ratio (A/B) | 605.52 | % | 122.12 | % | 129.24 | % |
Notes: | 1) Based on K-IFRS (on a separate basis). |
2) | Calculated based on Won-denominated assets and liabilities due within one month. |
3.3.2. | Profitability Ratios |
(Unit: %) | ||||||||||||
For the six months ended June 30, 2021 | For the year ended December 31, 2020 | For the year ended December 31, 2019 | ||||||||||
Net income as a percentage of average total assets (ROA) | 0.81 | 0.61 | 0.66 | |||||||||
Net income as a percentage of average shareholders’ equity (ROE) | 11.47 | 8.64 | 8.93 |
Note: | Based on K-IFRS (on a consolidated basis). |
3.3.3. | 20 Largest Exposures of Kookmin Bank by Borrower (As of June 30, 2021) |
(Unit: in billions of Won) | ||||
Company | Credit Extended | |||
Samsung Electronics Co., Ltd. | 1,256 | |||
Hyundai Steel Co., Ltd. | 936 | |||
KB Kookmin Card Co., Ltd. | 891 | |||
Kia Corporation | 854 | |||
Hyundai Motor Company | 806 | |||
Samsung Heavy Industries Co., Ltd. | 782 | |||
Hyundai Heavy Industries Co., Ltd. | 728 | |||
GS Caltex Corporation | 726 | |||
PT Bank KB Bukopin, Tbk. | 678 | |||
SK Inc. | 672 | |||
Federal Reserve Bank of New York | 660 | |||
LG Display Co., Ltd. | 629 | |||
LS-Nikko Copper Inc. | 566 | |||
Lotte Property and Development Co., Ltd. | 565 | |||
LG Electronics Inc. | 546 | |||
Samsung SDI Co., Ltd. | 516 | |||
LG Chem Co., Ltd. | 502 | |||
CJ Cheiljedang Corp. | 479 | |||
Hyundai Capital Services, Inc. | 443 | |||
S-OIL Corporation | 431 | |||
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Total | 13,666 | |||
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3.3.4. | 10 Largest Exposures of Kookmin Bank by Chaebol Group (As of June 30, 2021) |
(Unit: in billions of Won) | ||||
Group | Credit Extended | |||
Hyundai Motor | 4,446 | |||
Samsung | 4,001 | |||
SK | 3,137 | |||
LG | 2,437 | |||
Lotte | 1,999 | |||
Hyundai Heavy Industries | 1,725 | |||
Hanwha | 1,522 | |||
GS | 1,380 | |||
LS | 1,254 | |||
POSCO | 991 | |||
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Total | 22,892 | |||
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3.3.5. | Kookmin Bank’s Loan Concentration by Industry (As of June 30, 2021) |
(Unit: in billions of Won, except percentages) | ||||||||
Industry | Total Credit | Percentage of Total Credit | ||||||
Manufacturing | 46,059 | 29.2 | % | |||||
Real estate | 35,038 | 22.2 | % | |||||
Retail and wholesale | 24,283 | 15.4 | % | |||||
Hotel, lodging and food services | 9,925 | 6.3 | % | |||||
Financial institutions | 3,217 | 2.0 | % | |||||
Construction | 3,122 | 2.0 | % | |||||
Others | 36,127 | 22.9 | % | |||||
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Total | 157,771 | 100.0 | % | |||||
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3.3.6. Top 20 Non-Performing Loans of Kookmin Bank (As of June 30, 2021)
(Unit: in billions of Won) | ||||||||||
Borrower | Industry | Total Credit | Allowance for Loan Losses | |||||||
Borrower A | Construction | 41.7 | 40.7 | |||||||
Borrower B | Construction | 21.1 | 20.7 | |||||||
Borrower C | Health and social services | 19.3 | 1.2 | |||||||
Borrower D | Shipbuilding | 17.5 | 7.8 | |||||||
Borrower E | Publishing, film, broadcasting and information services | 16.3 | 11.7 | |||||||
Borrower F | Manufacturing | 12.6 | 6.2 | |||||||
Borrower G | Health and social services | 10.0 | 4.3 | |||||||
Borrower H | Hotel, lodging and food services | 9.5 | 2.5 | |||||||
Borrower I | Manufacturing | 9.4 | 9.3 | |||||||
Borrower J | Manufacturing | 9.2 | 0.6 | |||||||
Borrower K | Manufacturing | 8.2 | 3.0 | |||||||
Borrower L | Retail and wholesale | 7.9 | 6.1 | |||||||
Borrower M | Manufacturing | 7.3 | 4.0 | |||||||
Borrower N | Manufacturing | 6.3 | 5.5 | |||||||
Borrower O | Retail and wholesale | 6.1 | 0.2 | |||||||
Borrower P | Manufacturing | 5.4 | 3.8 | |||||||
Borrower Q | Retail and wholesale | 4.5 | 3.3 | |||||||
Borrower R | Manufacturing | 4.5 | 3.7 | |||||||
Borrower S | Manufacturing | 4.3 | 3.4 | |||||||
Borrower T | Manufacturing | 4.1 | 2.7 | |||||||
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Total | 225.2 | 140.7 | ||||||||
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3.4. | Other Financial Information |
See Exhibits 99.1 and 99.2 attached hereto for our consolidated and separate financial statements and relevant notes, which have been prepared in accordance with K-IFRS and reviewed by our independent auditors as stated in their review reports. The relevant reports will also be available on our website at www.kbfg.com.
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4. | Independent Public Accountants |
4.1. | Audit / Review Services |
(Unit: in millions of Won) | ||||||||||||||||||||
Period | Auditor | Activity | Agreed Per Contract(1) | Actual(2) | ||||||||||||||||
Compensation(3) | Estimated Hours | Compensation(3) | Accrued Hours | |||||||||||||||||
January 1 to June 30, 2021 | KPMG Samjong Accounting Corp. | Quarterly, semi-annual and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting) | 1,261 | 11,570 | 680 | 4,040 | ||||||||||||||
January 1 to December 31, 2020 | KPMG Samjong Accounting Corp. | Quarterly, semi-annual and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting) | 1,246 | 11,570 | 1,246 | 12,624 | ||||||||||||||
January 1 to December 31, 2020 | KPMG Samjong Accounting Corp. | Expansion of the scope of audit in connection with the acquisition of Prudential Life Insurance | 481 | 4,829 | 481 | 4,846 | ||||||||||||||
January 1 to December 31, 2019 | Samil PricewaterhouseCoopers | Quarterly, semi-annual and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting) | 1,081 | 11,234 | 1,081 | 10,832 |
Notes: | (1) Total compensation and estimated hours are established at the time of the execution of the audit and review services contract. |
(2) | Actual compensation and hours are accrued from January 1 of each applicable year to the date of the audit or review report issued during such year. |
(3) | Excluding value-added taxes. |
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4.2. Public Company Accounting Oversight Board (“PCAOB”) Audit Services
(Unit: in millions of Won) | ||||||||||
Period | Auditor | Activity | Service Period | Compensation(1) | ||||||
January 1 to June 30, 2021 | KPMG Samjong Accounting Corp. | PCAOB audit of consolidated financial statements and internal control over financial reporting | May 1, 2021 to April 30, 2022 | 681 | ||||||
January 1 to December 31, 2020 | KPMG Samjong Accounting Corp. | PCAOB audit of consolidated financial statements and internal control over financial reporting | May 1, 2020 to April 30, 2021 | 662 | ||||||
January 1 to December 31, 2019 | Samil PricewaterhouseCoopers | PCAOB audit of consolidated financial statements and internal control over financial reporting | May 1, 2019 to April 30, 2020 | 573 |
Note: | (1) Total compensation (excluding value-added taxes) is established at the time of the execution of the audit and review services contract. |
4.3. | Change in Auditor |
Pursuant to the Act on External Audit of Stock Companies and the related regulations thereunder, the Securities and Futures Commission of the Financial Services Commission designated KPMG Samjong Accounting Corp. as the new external auditor for the Company for the fiscal years ending December 31, 2020, 2021 and 2022. As such, the external auditor for the Company and its subsidiaries (except Prudential Life Insurance Company of Korea, Ltd. which will keep Samil Pricewaterhouse Coopers as its external auditor) for the fiscal year ending December 31, 2020 has been changed from Samil PricewaterhouseCoopers to KPMG Samjong Accounting Corp.
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5. | Corporate Governance and Affiliated Companies |
5.1. | Board of Directors & Committees under the Board |
As of June 30, 2021, our board of directors consisted of nine directors, comprising one executive director, one non-standing director and seven non-executive directors. In accordance with internal policies regarding the Company’s board of directors (the “Board”), the chairman of the Board is elected upon the Board’s approval. On March 26, 2021, Mr. Suk Ho Sonu was elected as chairman of the Board, and he does not concurrently serve as chief executive officer of the Company. The following committees currently serve under our board of directors:
• | Audit Committee; |
• | Risk Management Committee; |
• | Evaluation and Compensation Committee; |
• | Non-Executive Director Nominating Committee; |
• | Audit Committee Member Nominating Committee (ad hoc committee); |
• | CEO Nominating Committee; |
• | Subsidiaries’ CEO Director Nominating Committee; and |
• | ESG Committee |
For the list of our directors, see 6. Directors, Senior Management and Employees — 6.1. Executive Directors, — 6.2. Non-standing Directors and — 6.3. Non-executive Directors below.
5.2. | Audit Committee |
The Audit Committee oversees our financial reporting and approves the appointment of our independent auditors and internal compliance officers. The committee also reviews our financial information, auditor’s examinations, key financial statement issues, the plans and evaluation of internal controls and the administration of our financial affairs by the board of directors. In connection with the general meetings of shareholders, the committee examines the agenda for, and financial statements and other reports to be submitted by, the board of directors to each general meeting of shareholders. The committee holds regular meetings every quarter and on an as-needed basis.
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The following table shows a list of audit committee requirements under Articles 415 and 542 of the Commercial Act and how we fulfill each requirement as of June 30, 2021.
The Commercial Act Requirements | KB Financial Group | |
The Audit Committee must consist of three or more directors. | We have four Audit Committee members. | |
At least two-thirds of the Audit Committee members must be non-executive directors.
| All four Audit Committee members, including the chairman of the committee, are non-executive directors. | |
The chairman of the Audit Committee must be a non-executive director. | ||
At least one Audit Committee member must be an accounting or financial expert. | All four Audit Committee members are accounting or financial experts. |
5.3. | Compensation to Directors |
5.3.1. | Total Amount of Compensation Approved at the Annual General Meeting of Shareholders |
(Unit: in millions of Won) | ||||||||||||
Total number of persons(1) | Total compensation approved at shareholders’ meeting(2) | Notes | ||||||||||
Registered Directors (Non-executive directors) | 9 (7) | 3,000 | — |
Notes: | (1) Represents the total number of applicable persons as of June 30, 2021. |
(2) | Represents the aggregate amount for all directors (including non-executive directors). Excludes compensation in the form of long-term performance-based stock grants. |
5.3.2. Total Amount of Compensation Paid
(As of June 30, 2021) | (Unit: in millions of Won) | |||||||||||
Total number of persons(1) | Total payment(2)(3) | Average payment per person(4) | Notes | |||||||||
9 | 722 | 80 | — |
Notes: | (1) Represents the total number of applicable persons as of June 30, 2021. |
(2) | Represents the total amount paid (rounded to the nearest million) for the six months ended June 30, 2021. |
(3) | Total payment amount in accordance with the Company’s internal policies on compensation to directors. |
(4) | Represents (i) the total amount paid (rounded to the nearest million) for the six months ended June 30, 2021, divided by (ii) the number of applicable persons for the applicable reporting period. |
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5.3.3. Compensation Breakdown
(As of June 30, 2021) | (Unit: in millions of Won) | |||||||||||||||
Total number of persons(1) | Total payment(2)(3) | Average payment per person(4) | Notes | |||||||||||||
Registered Directors (excluding non-executive directors and Audit Committee members) | 2 | 445 | 223 | — | ||||||||||||
Non-executive Directors (excluding Audit Committee members) | 3 | 119 | 40 | — | ||||||||||||
Audit Committee members | 4 | 159 | 40 | — | ||||||||||||
Internal Auditor | — | — | — | — |
Notes: | (1) Represents the total number of applicable persons as of June 30, 2021. |
(2) | Represents the total amount paid (rounded to the nearest million) for the six months ended June 30, 2021. |
(3) | Total payment amount in accordance with the Company’s internal policies on compensation to directors. |
(4) | Represents (i) the total amount paid (rounded to the nearest million) for the six months ended June 30, 2021, divided by (ii) the number of applicable persons for the applicable reporting period. |
5.4. | Top 5 Highest-Paid Individuals |
5.4.1. | Compensation exceeding Won 500 million – Individual basis |
Not applicable.
5.5. | Affiliated Companies |
5.5.1. | List of Affiliated Companies |
Affiliated companies of KB Financial Group that are first-tier subsidiaries and KB Financial Group’s ownership of such companies as of June 30, 2021 are as follows.
1) | Kookmin Bank (100.00%) |
2) | KB Securities Co., Ltd. (100.00%) |
3) | KB Insurance Co., Ltd. (100.00%) |
4) | KB Kookmin Card Co., Ltd. (100.00%) |
5) | Prudential Life Insurance Company of Korea, Ltd. (100.00%) |
6) | KB Asset Management Co., Ltd. (100.00%) |
7) | KB Capital Co., Ltd. (100.00%) |
8) | KB Life Insurance Co., Ltd. (100.00%) |
9) | KB Real Estate Trust Co., Ltd. (100.00%) |
10) | KB Savings Bank Co., Ltd. (100.00%) |
11) | KB Investment Co., Ltd. (100.00%) |
12) | KB Data Systems Co., Ltd. (100.00%) |
13) | KB Credit Information Co., Ltd. (100.00%) |
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6. | Directors, Senior Management and Employees |
6.1. | Executive Directors |
As of June 30, 2021, we had one executive director. The name, position and the end of the term of our executive director and the number of shares of our common stock he owned as of June 30, 2021 are set forth below.
Name | Date of Birth | Position | Common Shares Owned | End of Term | ||||||||||||
Jong Kyoo Yoon | October 1955 | Chairman & Chief Executive Officer | 21,000 | November 20, 2023 |
6.2. | Non-standing Directors |
As of June 30, 2021, we had one non-standing director. The name, position and the end of the term of our non-standing director and the number of shares of our common stock he owned as of June 30, 2021 are set forth below.
Name | Date of Birth | Position | Common Shares Owned | End of Term(1) | ||||||||||||
Yin Hur | December 1961 | Non-standing Director | 13,500 | March 19, 2022 |
Note: (1) | Mr. Yin Hur’s end of term is the date of the annual general meeting of shareholders for fiscal year 2021, which is expected be held in March 2022. |
6.3. | Non-executive Directors |
As of June 30, 2021, we had seven non-executive directors. The name, position and the end of the term of our non-executive directors and the number of shares of our common stock they respectively owned as of June 30, 2021 were as follows.
Name | Date of Birth | Position | Common Shares Owned | End of Term | ||||||
Suk Ho Sonu | September 1951 | Non-executive Director | 1,300 | March 25, 2022 | ||||||
Stuart B. Solomon | July 1949 | Non-executive Director | — | March 25, 2022 | ||||||
Myung Hee Choi | February 1952 | Non-executive Director | — | March 25, 2022 | ||||||
Kouwhan Jeong | September 1953 | Non-executive Director | — | March 25, 2022 | ||||||
Kyung Ho Kim | December 1954 | Non-executive Director | — | March 25, 2022 | ||||||
Seon-joo Kwon | November 1956 | Non-executive Director | — | March 19, 2022 | ||||||
Gyutaeg Oh | February 1959 | Non-executive Director | — | March 19, 2022 |
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As of June 30, 2021, the following non-executive director also served as a director at another company.
Name | Company | Position | Appointment Date | |||
Kouwhan Jeong | Nambujeil Law and Notary Office Inc. | Co-president Attorney at Law | May 2016 |
Members of our senior management as of June 30, 2021 are as follows. The number of common shares owned is as of June 30, 2021.
Name | Date of Birth | Position | Common Shares Owned(1) | End of Term | ||||||
Jong Hee Yang | June 1961 | Vice Chairman and Chief Operation Officer, Head of Insurance Business Unit and Global Business Unit | 914 | December 31, 2021 | ||||||
Chang Kwon Lee | November 1965 | Senior Executive Vice President, Chief Strategy Officer and Chief Global Strategy Officer | 2,010 | December 31, 2021 | ||||||
Hwan-Ju Lee | October 1964 | Senior Executive Vice President and Chief Finance Officer | 3,080 | December 31, 2021 | ||||||
Pil Kyu Im | March 1964 | Senior Executive Vice President and Chief Risk Management Officer | 1,005 | December 31, 2022 | ||||||
Woo Yeul Lee | November 1964 | Senior Executive Vice President and Chief Human Resources Officer | 1,446 | December 31, 2021 | ||||||
Dong Whan Han | January 1965 | Senior Executive Vice President and Chief Digital Platform Officer | 1,100 | December 31, 2021 | ||||||
Jin Gyu Maeng | January 1966 | Senior Managing Director and Head of Audit | 886 | December 31, 2021 | ||||||
Bong Joong Kwon | November 1969 | Managing Director and Head of IR | 286 | December 31, 2022 | ||||||
Byung Joo Oh | January 1973 | Managing Director, Insurance Business Unit | 602 | December 31, 2022 | ||||||
Hye Ja Suh | September 1966 | Managing Director and Chief Compliance Officer | 1,242 | December 31, 2022 | ||||||
Seok Mun Choi | August 1968 | Managing Director and Head of the Office of Board of Directors | 869 | December 31, 2021 | ||||||
Soon Bum Kwon | October 1966 | Managing Director | 1,674 | December 31, 2021 | ||||||
Sung Hyun Kim | August 1963 | Head of Corporate and Investment Banking Business Unit | 15,468 | December 31, 2021 | ||||||
Jeong Rim Park | November 1963 | Head of Capital Market Business Unit | 3,150 | December 31, 2021 | ||||||
Dong Cheol Lee | October 1961 | Head of Retail Customer Business Unit | 3,325 | December 31, 2021 | ||||||
Young Gil Kim | January 1963 | Head of Wealth Management and Pension Business Unit | 568 | December 31, 2021 | ||||||
Woon Tae Kim | May 1963 | Head of Small and Medium Enterprise Business Unit | 1,541 | December 31, 2021 | ||||||
Jin Young Kim | August 1969 | Chief Public Relation Officer | 765 | December 31, 2021 | ||||||
Jin Soo Yoon | February 1964 | Chief Information Technology Officer | 100 | December 31, 2021 | ||||||
Chang Hwa Yook | December 1967 | Chief Data Officer | 408 | December 31, 2021 | ||||||
Sang Cheol Heo | December 1965 | Chief Contact Center Officer | 542 | December 31, 2021 | ||||||
Jae Young Choi | June 1967 | Head of Pension Business Division | 765 | December 31, 2021 | ||||||
Sang-Hyeon Woo | February 1964 | Senior Executive Vice President, Corporate and Investment Banking Business Unit | 348 | December 31, 2021 | ||||||
Jeong Ha | January 1967 | Senior Executive Vice President, Capital Market Business Unit | — | December 31, 2021 | ||||||
Chai Hyun Sung | September 1965 | Senior Executive Vice President, Retail Customer Business Unit | 7,466 | December 31, 2021 | ||||||
Chan Yong Park | September 1965 | Head of the Office of Planning and Coordination | 794 | December 31, 2021 | ||||||
Sungpyo Jeon | August 1966 | Head of Future Contact Center Planning | 816 | December 31, 2021 | ||||||
Young Suh Cho | February 1971 | Head of KB Research | — | December 31, 2021 |
Note: (1) | The number of common shares owned includes those owned in the holder’s name under the employee stock ownership association’s account, and may differ from the number of shares owned as reported pursuant to Article 173 of the Financial Investment Services and Capital Markets Act. |
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As of June 30, 2021, the following management also served as senior management at our subsidiaries.
Name | Subsidiary | Position | Appointment Date | |||
Yin Hur | Kookmin Bank | President and Chief Executive Officer | November 2017 | |||
Sung Hyun Kim | KB Securities | Chief Executive Officer | January 2019 | |||
Jeong Rim Park | KB Securities | Chief Executive Officer | January 2019 | |||
Dong Cheol Lee | KB Kookmin Card | Chief Executive Officer | January 2018 | |||
Young Gil Kim | Kookmin Bank | Senior Executive Vice President; Wealth Management Group | January 2020 | |||
KB Securities | Senior Executive Vice President; Wealth Management Division | January 2019 | ||||
KB Insurance | Senior Executive Vice President; Pension Division | January 2021 | ||||
Woon Tae Kim | Kookmin Bank | Senior Executive Vice President; SME and SOHO Customer Group | January 2021 | |||
Jin Young Kim | Kookmin Bank | Managing Director; Brand·ESG Group | January 2021 | |||
Jin Soo Yoon | Kookmin Bank | Senior Executive Vice President; Tech Group | January 2021 | |||
Chang Hwa Yook | Kookmin Bank | Head of Data Platform Division | January 2021 | |||
KB Kookmin Card | Managing Director; Data Strategy Division | January 2021 | ||||
Sang Cheol Heo | Kookmin Bank | Senior Managing Director; Smart Customer Group | January 2021 | |||
Jae Young Choi | Kookmin Bank | Head of Pension Business Division | May 2019 | |||
KB Securities | Managing Director; Pension Business Division | January 2020 | ||||
Sang-Hyeon Woo | Kookmin Bank | Senior Executive Vice President; Corporate Investment Banking Customer Group | January 2021 | |||
KB Securities | Senior Executive Vice President; Investment Banking Division | January 2020 | ||||
Jeong Ha | Kookmin Bank | Senior Executive Vice President; Capital Markets Group | January 2021 | |||
Chai Hyun Sung | Kookmin Bank | Senior Executive Vice President; Retail Customer Group | January 2020 | |||
Chan Yong Park | Kookmin Bank | Managing Director; Planning and Coordination Department | January 2021 | |||
Sungpyo Jeon | Kookmin Bank | Head of Future Contact Center Implementation Department | January 2021 | |||
Young Suh Cho | Kookmin Bank | Senior Managing Director, DT Strategy Division | January 2021 | |||
Chang Kwon Lee | KB Insurance | Non-standing Director | February 2021 | |||
Hwan-Ju Lee | KB Securities | Non-standing Director | February 2021 | |||
KB Kookmin Card | Non-standing Director | February 2021 |
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6.5. | Employees |
The following table shows information regarding our employees and compensation paid to them as of June 30, 2021.
(Unit: in millions of Won) | ||||||||||||
Number of Employees(A)(1) | Average Tenure of Employees(2) | Total Amount of Compensation(B)(3)(4) | Average Compensation per Person(B/A)(3)(4) | |||||||||
163 | | 3 years and 11 months (15 years and 3 months | ) | 13,466 | 83 |
Notes: | (1) Includes all employees as of June 30, 2021, including executive officers. |
(2) | The duration in parentheses includes tenure at our subsidiaries. |
(3) | Based on the sum of all compensation paid from January 1, 2021 to June 30, 2021. |
(4) | Includes retroactive payment of bonuses from 2020. The average compensation per person excluding such amounts is Won 71 million. |
The following table shows information regarding our executive officers and compensation paid to them as of June 30, 2021.
(Unit: in millions of Won) | ||||||||
Number of Executive Officers(A)(1) | Total Amount of Compensation(B)(2) | Average Compensation per Person(B/A)(2) | ||||||
12 | 2,012 | 168 |
Notes: | (1) Excludes 16 executive officers who serve primarily as executive officers at our subsidiaries. |
(2) | Based on the sum of all compensation paid from January 1, 2021 to June 30, 2021. |
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7. | Major Shareholders and Related Party Transactions |
7.1. | Major Shareholders |
The following table presents information regarding holders of 5% or more of our total issued shares based on our shareholder registry as of June 30, 2021, unless specified otherwise.
(Unit: shares, %) | ||||||||
Name | Number of Shares of Common Stock | Percentage of Total Issued Shares(1) | ||||||
Korean National Pension Service | 40,626,942 | 9.77 | ||||||
JP Morgan Chase Bank, N.A.(2) | 23,167,967 | 5.57 | ||||||
BlackRock Fund Advisors(3) | 25,050,939 | 6.02 |
Notes: | (1) Based on 415,807,920 shares of our common stock issued. |
(2) | Depositary under the Company’s ADR program. The voting rights are held by ADR holders. |
(3) | As of February 26, 2021, based on disclosure made by BlackRock Fund Advisors in a statement of acquisition filing on March 10, 2021. |
7.2. | Changes in the Largest Shareholder |
(As of June 30, 2021) | (Unit: shares, %) | |||||||||||
Name of Largest Shareholder | Date of Change in Largest Shareholder/ Date of Change in Number of Shares Owned | Number of Shares of Common Stock(1) | Percentage of Total Issued Shares(2) | |||||||||
Korean National Pension Service | August 12, 2016 | 36,826,207 | 9.53 | |||||||||
Korean National Pension Service | December 31, 2016 | 41,190,896 | 9.85 | |||||||||
Korean National Pension Service | April 24, 2017 | 40,950,453 | 9.79 | |||||||||
Korean National Pension Service | October 16, 2017 | 40,479,793 | 9.68 | |||||||||
Korean National Pension Service | December 31, 2017 | 40,204,583 | 9.62 | |||||||||
Korean National Pension Service | December 31, 2018 | 39,704,733 | 9.50 | |||||||||
Korean National Pension Service | December 31, 2019 | 41,468,003 | 9.97 | |||||||||
Korean National Pension Service | February 1, 2020 | 41,462,588 | (3) | 9.97 | ||||||||
Korean National Pension Service | October 12, 2020 | 41,402,150 | 9.96 | |||||||||
Korean National Pension Service | December 31, 2020 | 41,287,280 | 9.93 | |||||||||
Korean National Pension Service | June 30, 2021 | 40,626,942 | 9.77 |
Notes: | (1) Based on our shareholder registry as of each corresponding date unless specified otherwise. |
(2) | Total number of shares of common stock issued as of the following dates: |
Prior to October 19, 2016: 386,351,693 |
From October 19, 2016 to December 12, 2019: 418,111,537 |
After December 12, 2019: 415,807,920 |
(3) | Based on disclosure made by the Korean National Pension Service in a statement of acquisition filing on February 7, 2020. |
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7.3. | Employee Stock Ownership Association |
(As of June 30, 2021) | (Unit: shares) | |||
Company Name | Number of Shares of Common Stock Owned | |||
KB Financial Group Inc. | 47,126 | |||
Kookmin Bank | 6,578,609 | |||
KB Securities Co., Ltd. | 27,240 | |||
KB Insurance Co., Ltd. | 353,415 | |||
KB Kookmin Card Co., Ltd. | 281,512 | |||
Prudential Life Insurance Company of Korea, Ltd. | 437 | |||
KB Asset Management Co., Ltd. | 10,544 | |||
KB Capital Co., Ltd. | 26,153 | |||
KB Life Insurance Co., Ltd. | 20,941 | |||
KB Real Estate Trust Co., Ltd. | 13,583 | |||
KB Savings Bank Co., Ltd. | 6,781 | |||
KB Investment Co., Ltd. | 1,463 | |||
KB Data Systems Co., Ltd. | 16,214 | |||
KB Credit Information Co., Ltd. | 11,145 | |||
Others | 2,924 | |||
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Total | 7,398,087 | |||
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7.4. | Investments in Affiliated Companies |
(As of June 30, 2021) | (Units: shares, %, millions of Won) | |||||||||||||||||||
Company Name | Ending Balance | Total assets as of the latest fiscal year(1) | Net income (loss) for the latest fiscal year(1) | |||||||||||||||||
| Number of shares owned | | Ownership | Book value | ||||||||||||||||
Kookmin Bank | 404,379,116 | 100 | 14,821,721 | 438,444,114 | 2,298,195 | |||||||||||||||
KB Securities Co., Ltd. | 298,620,424 | 100 | 3,342,391 | 57,499,659 | 425,622 | |||||||||||||||
KB Insurance Co., Ltd. | 66,500,000 | 100 | 2,375,430 | 39,078,117 | 163,884 | |||||||||||||||
KB Kookmin Card Co., Ltd. | 92,000,000 | 100 | 1,953,175 | 24,071,645 | 324,662 | |||||||||||||||
Prudential Life Insurance Company of Korea, Ltd. | 15,000,000 | 100 | 2,310,054 | 23,171,566 | (2) | 227,806 | (2) | |||||||||||||
KB Asset Management Co., Ltd. | 7,667,550 | 100 | 96,312 | 335,601 | 57,317 | |||||||||||||||
KB Capital Co., Ltd. | 25,227,566 | 100 | 673,811 | 12,848,199 | 141,646 | |||||||||||||||
KB Life Insurance Co., Ltd. | 91,200,000 | 100 | 485,314 | 10,424,916 | (23,185 | ) | ||||||||||||||
KB Real Estate Trust Co., Ltd. | 16,000,000 | 100 | 121,553 | 437,518 | 66,874 | |||||||||||||||
KB Savings Bank Co., Ltd. | 8,001,912 | 100 | 176,813 | (3) | 1,883,720 | 17,305 | ||||||||||||||
KB Investment Co., Ltd. | 22,525,328 | 100 | 154,910 | 848,693 | 15,387 | |||||||||||||||
KB Data Systems Co., Ltd. | 800,000 | 100 | 6,334 | 40,347 | (1,729 | ) | ||||||||||||||
KB Credit Information Co., Ltd. | 1,252,400 | 100 | 21,331 | 27,711 | 1,132 | |||||||||||||||
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Total | — | — | 26,539,149 | — | — | |||||||||||||||
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Note: | (1) Based on K-IFRS (on a consolidated basis), unless specified otherwise. |
(2) | Based on K-IFRS (on a separate basis). |
(3) | Includes the difference between the fair value and the face value of subordinated debt that was issued by KB Savings Bank Co., Ltd. and acquired by KB Financial Group Inc. |
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7.5. | Related Party Transactions |
7.5.1. | Purchase of capital securities issued by KB Capital Co., Ltd. |
(Unit: in billions of Won) | ||||||||||||||||||
Issuer | Relationship | Type | Issue Amount | Issue Date | Interest Rate | Maturity Date | Use of Proceeds | |||||||||||
KB Capital Co., Ltd. | Subsidiary | No. 299 Private Placement of Capital Securities in Won | 50 | March 27, 2015 | | 6.548 | %(1) | March 27, 2045 (may be extended) | Working capital |
Note: | (1) The interest rate has increased from its initial rate due to the non-exercise of the call option. |
(Unit: in billions of Won) | ||||||||||||||||||
Issuer | Relationship | Type | Issue Amount | Issue Date | Interest Rate | Maturity Date | Use of Proceeds | |||||||||||
KB Capital Co., Ltd. | Subsidiary | No. 320 Private Placement of Capital Securities in Won | 50 | September 24, 2015 | | 5.989 | %(1) | September 24, 2045 (may be extended) | Working capital |
Note: | (1) The interest rate has increased from its initial rate due to the non-exercise of the call option. |
(Unit: in billions of Won) | ||||||||||||||||||
Issuer | Relationship | Type | Issue Amount | Issue Date | Interest Rate | Maturity Date | Use of Proceeds | |||||||||||
KB Capital Co., Ltd. | Subsidiary | No. 343 Private Placement of Capital Securities in Won | 50 | March 29, 2016 | | 6.305 | %(1) | March 29, 2046 (may be extended) | Working capital |
Note: | (1) The interest rate has increased from its initial rate due to the non-exercise of the call option. |
(Unit: in billions of Won) | ||||||||||||||||||
Issuer | Relationship | Type | Issue Amount | Issue Date | Interest Rate | Maturity Date | Use of Proceeds | |||||||||||
KB Capital Co., Ltd. | Subsidiary | No. 352 Private Placement of Capital Securities in Won | 50 | June 28, 2016 | | 6.466 | %(1) | June 28, 2046 (may be extended) | Working capital |
Note: | (1) The interest rate has increased from its initial rate due to the non-exercise of the call option. |
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(Unit: in billions of Won) | ||||||||||||||||
Issuer | Relationship | Type | Issue Amount | Issue Date | Interest Rate | Maturity Date | Use of Proceeds | |||||||||
KB Capital Co., Ltd. | Subsidiary | No. 367 Private Placement of Capital Securities in Won | 50 | November 28, 2016 | 4.744 | % | November 28, 2046 (may be extended) | Working capital | ||||||||
(Unit: in billions of Won) | ||||||||||||||||
Issuer | Relationship | Type | Issue Amount | Issue Date | Interest Rate | Maturity Date | Use of Proceeds | |||||||||
KB Capital Co., Ltd. | Subsidiary | No. 378 Private Placement of Capital Securities in Won | 50 | April 27, 2017 | 4.431 | % | April 27, 2047 (may be extended) | Working capital | ||||||||
(Unit: in billions of Won) | ||||||||||||||||
Issuer | Relationship | Type | Issue Amount | Issue Date | Interest Rate | Maturity Date | Use of Proceeds | |||||||||
KB Capital Co., Ltd. | Subsidiary | No. 460 Private Placement of Capital Securities in Won | 100 | September 25, 2020 | 3.376 | % | September 25, 2050 (may be extended) | Working capital |
7.5.2. | Purchase of subordinated debt issued by KB Savings Bank Co., Ltd. |
(Unit: in billions of Won) | ||||||||||||||
Issuer | Relationship | Type | Issue Amount | Issue Date | Interest Rate | Maturity Date | Use of Proceeds | |||||||
KB Savings Bank Co., Ltd. | Subsidiary | No. 1 Subordinated Debt | 70 | June 25, 2021 | 1.600% | June 25, 2031 | Working capital |
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7.5.3. | Prepayments and Loans to Subsidiaries |
(Unit: in billions of Won) | ||||||||||||||
Name | Relationship | Account | Loan Amount | Current | Credit Offering | Interest Rate | Maturity Date | |||||||
KB Investment Co., Ltd. | Subsidiary | Loans(1) | 10 | 10 | July 14, 2017 | 2.239%(2) | July 12, 2022 |
Notes: | (1) Unsecured credit loans. |
(2) | Changed from 2.141% to 2.239% upon extension of the loans on July 12, 2021. |
(Unit: in billions of Won) | ||||||||||||||
Name | Relationship | Account | Loan Amount | Current | Credit Offering | Interest Rate | Maturity Date | |||||||
KB Investment Co., Ltd. | Subsidiary | Loans(1) | 40 | 40 | July 13, 2018 | 2.239%(2) | July 12, 2022 |
Notes: | (1) Unsecured credit loans. |
(2) | Changed from 2.141% to 2.239% upon extension of the loans on July 12, 2021. |
(Unit: in billions of Won) | ||||||||||||||
Name | Relationship | Account | Loan Amount | Current | Credit Offering | Interest Rate | Maturity Date | |||||||
KB Investment Co., Ltd. | Subsidiary | Loans(1) | 70 | 70 | March 8, 2019 | 2.245%(2) | March 8, 2022 |
Notes: | (1) Unsecured credit loans. |
(2) | Changed from 2.189% to 2.245% upon extension of the loans on March 9, 2021. |
(Unit: in billions of Won) | ||||||||||||||
Name | Relationship | Account | Loan Amount | Current | Credit Offering | Interest Rate | Maturity Date | |||||||
KB Investment Co., Ltd. | Subsidiary | Loans(1) | 30 | 30 | March 9, 2020 | 2.245%(2) | March 8, 2022 |
Notes: | (1) Unsecured credit loans. |
(2) | Changed from 2.189% to 2.245% upon extension of the loans on March 9, 2021. |
(Unit: in billions of Won) | ||||||||||||||
Name | Relationship | Account | Loan Amount | Current | Credit Offering | Interest Rate | Maturity Date | |||||||
KB Investment Co., Ltd. | Subsidiary | Loans(1) | 30 | 30 | July 13, 2020 | 2.239%(2) | July 12, 2022 |
Notes: | (1) Unsecured credit loans. |
(2) | Changed from 2.141% to 2.239% upon extension of the loans on July 12, 2021. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
KB Financial Group Inc. | ||||||
(Registrant) | ||||||
Date: August 17, 2021 | By: | /s/ Hwan-Ju Lee | ||||
(Signature) | ||||||
Name: Hwan-Ju Lee | ||||||
Title: | Senior Executive Vice President and Chief Finance Officer |