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    A105560   KR7105560007

KB FINANCIAL GROUP INC.

(A105560)
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KB Financial : 2021 First Half Earnings Release

07/22/2021 | 03:48am EDT

1H21 Business Results

July, 2021

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Major non-recurringitems 2)

I. 1H21 Financial Highlights _ Overview

Group Profitability Overview

Group Net Profit Analysis (bn won)

bn won, %

1H21

1H20

YoY

2Q21

1Q21

QoQ

143

67

Provision

347

44

155

Non-

Net Interest Income

5,401.1

4,683.2

15.3

2,758.8

2,642.3

4.4

for credit

G&A

Profit from

Profit from

operating

losses

468

Net Fee & Commission Income

1,832.6

1,381.3

32.7

865.4

967.2

-10.5

451

profit

expenses

2,474

financial

insurance

Other Operating Profit

-23.4

-49.6

N.A.

-57.2

33.8

N.A.

investments

business

Tax

Fee &

expenses

commission

Gross Operating Income

7,210.3

6,014.9

19.9

3,567.0

3,643.3

-2.1

718

and others

income

G&A Expenses

3,392.6

3,045.6

11.4

1,669.5

1,723.1

-3.1

1,711

Provision for Credit Losses

397.1

539.7

-26.4

223.7

173.4

29.0

Interest

income

Net Operating Profit

3,420.6

2,429.6

40.8

1,673.8

1,746.8

-4.2

Net Non-Operating Profit

32.8

-34.0

N.A.

-6.8

39.6

N.A.

Profit for the Period

2,492.6

1,731.4

44.0

1,207.4

1,285.2

-6.1

1H20

1H21

Profit attributable to

2,474.3

1,711.3

44.6

1,204.3

1,270.0

-5.2

Note) Each earnings component is stated as in 'before tax' amount

controlling interests

Group Net Profit Trend1) (bn won)

Net Profit by Subsidiaries1) & Non-Bank Contribution2) (bn won)

2,474

Over 3tn for 4 consecutive years

89

192

3,311

3,312

3,455

2,505

1,711

253

Non-Bank

45.2%

143

3,061

1,880

27

374

164

144

129

1,711

2,474

1,423

1,247

Bank

54.8%

2017

2018

2019

2020

1H20

1H21

1H20

1H21

1H21

Note 1) Based on profit attributable to controlling interests

  1. Major non-recurring items (after tax)
    1H20: Preemptive provisioning based on FLC (W149bn), Large-scale reversals of provisioning (W55bn), PEF related losses including TRS valuation losses (W29bn)
    1H21: KB Insurance ERP costs(W21bn), Insurance loss from large-scale fires(W10bn)

Bank

Securities

Insurance

Card

Prudential Life

Others(incl. adjustment for consolidation)

Note 1) Based on each subsidiary's profit attributable to controlling interests

  1. Based on simple arithmetic sum of each subsidiary's net profit on the financial statements for group reporting

02

I. 1H21 Financial Highlights _ Key Financial Indicators (1)

Group ROA∙ROE (%)

Loans in Won Growth (tn won, %)

NIM (%)

11.73

12.50

12.07

12.38

11.48

8.97

11.95

5.61

0.85

0.81

0.77

0.81

0.64

0.38

3Q20

4Q20

1Q21

2Q21

1H20

1H21

295 302

2020 2021.6

1.7

1.2

1.7

0.4

292

295

297

302

138

134

133

134

2.7

0.8

-0.5

0.1

164

158

162

163

2.4

2.6

0.6

0.9

'20.9

'20.12

'21.3

'21.6

1.82

1.82

1.82

1.75

1.73

1.78

1.56

1.56

1.56

1.49

1.51

1.53

3Q20

4Q20

1Q21

2Q21

1H20

1H21

ROA

ROE

ROE(on recurring basis)

Household

Corporate

Total Growth(QoQ)

Household Growth(QoQ)

Corporate Growth(QoQ)

GroupBank

Enhanced profitability driven by core earnings and diversification

·1H21 Group ROA and ROE recorded 0.81%, 11.95% respectively

·Improved earnings capacity on the back of stable growth in core income as well as diversified business portfolio

·1H21 ROE on a recurring basis recorded 12.38%, demonstrating solid earnings fundamental and profitability

*ROE: Based on ROCE(Return on Common Equity), which represents profitability of common equity

Secured stable interest income stream led by solid loan growth

·Loan in Won of the bank increased 2.0% YTD and 1.7% QoQ, amounting to W302tn as of the end of 2Q21

·Household loans increased 1.5% YTD to W164tn, driven by Jeonse and prime unsecured loans

·Corporate loans continued stable growth by 2.8% YTD, driven mostly by growth in SOHO and prime SMEs

Focus on margin management and diversify interest income sources

·1H21 Group NIM and Bank NIM marked 1.82% and 1.56%, up 4bp and 3bp YoY respectively

·1H21 Group NIM and Bank NIM improved YoY driven by efforts to increase margin by securing low-cost funding and pursuing loan strategy based on profitability. 2Q21 NIM however recorded last quarter's level due in part to repricing in the loan portfolio

·Focus on NIM management by expanding low- cost deposits and implementing proper loan pricing, as well as diversifying income sources

03

I. 1H21 Financial Highlights _ Key Financial Indicators (2)

Group Cost-Income Ratio(CIR) (%)

Credit Cost Ratio(CCR) (%)

Group BIS Ratio (Basel III, %)

55.2

54.5

54.9

54.7

51.8

50.5

50.9

47.1

49.4

45.3

0.20

0.21

0.20

0.05 0.04 0.04

0.260.25

0.22

0.20

0.20

0.13

0.11

0.10

0.09

0.08

16.04

16.03

15.23

15.28

14.60

14.48

14.78

14.76

14.60

13.97

14.06

13.86

14.60

13.97

13.58

13.79

13.70

13.30

2017 2018 2019 2020 1H21

CIR

CIR(excl. non-recurring items)

2017

2018

2019

2020

1Q21

2Q21

Group

Bank

Cumulative

excl. COVID19-related additional provision

2017

2018

2019

2020

'21.3

'21.6(e)

BIS Tier1 CET1

Improved cost efficiency led by enhanced

Sustained preemptive and

Industry-highest capital buffer

profitability and cost management

conservative asset quality management

·1H21 Group CIR recorded 47.1%, demonstrating significant improvement in cost efficiency led by growth in core earnings and group wide cost control efforts

·1H21 Group CIR on a recurring basis recorded 45.3%, maintaining its stable downward trend. Improvement in cost-efficiency becomes much more visible when additionally taking into account accrual of bonus expenses

·Continue to improve cost-efficiency through earnings expansion and cost control efforts

·1H21 and 2Q21 Group CCR was maintained at stable levels, recording 0.22%, 0.25% respectively

·Proved KB's high competency in risk management by pursuing loan growth centered on high-quality assets and preemptive credit quality management, despite growing concerns over asset quality in result of prolonged COVID-19

·Continue preemptive and conservative asset quality management in consideration of loan forbearance related to COVID-19 and concerns over economic uncertainties

·Group BIS and CET1 ratios are expected to mark 16.03% and 13.70% as of the end of June 2021

·Despite payout of dividend and increased RWA due to loan growth, Group secured the industry highest capital adequacy on the back of solid increase in net profit and strategic management of capital including issuance of hybrid bonds

·Bank BIS and CET1 ratios are expected to mark 18.92% and 15.88%, respectively

04

Disclaimer

KB Financial Group Inc. published this content on 22 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 July 2021 07:47:06 UTC.


© Publicnow 2021
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Financials
Sales 2021 14 202 B 12,0 B 12,0 B
Net income 2021 4 285 B 3,62 B 3,62 B
Net Debt 2021 - - -
P/E ratio 2021 4,90x
Yield 2021 5,46%
Capitalization 20 300 B 17 208 M 17 174 M
Capi. / Sales 2021 1,43x
Capi. / Sales 2022 1,39x
Nbr of Employees 25 428
Free-Float 92,0%
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Technical analysis trends KB FINANCIAL GROUP INC.
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TrendsNeutralBearishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 22
Last Close Price 52 100,00 KRW
Average target price 70 909,09 KRW
Spread / Average Target 36,1%
EPS Revisions
Managers and Directors
Jong-Kyoo Yoon Chairman & Chief Executive Officer
Hwan-Joo Lee Chief Financial Officer & Senior Executive VP
Jin Soo Yoon Chief Information Technology Officer
Jong-Hee Yang Vice Chairman & Chief Operating Officer
Hye Ja Suh Managing Director & Chief Compliance Officer
Sector and Competitors