UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE13a-16 OR15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month ofApril 2019
Commission File Number:000-53445
KB Financial Group Inc.
(Translation of registrant’s name into English)
26,Gukjegeumyung-ro8-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 ofForm 20-F orForm 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting theForm 6-K in paper as permitted byRegulation S-T Rule 101(b)(1): ☐
Note: RegulationS-T Rule 101(b)(1) only permits the submission in paper of a Form6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting theForm 6-K in paper as permitted byRegulation S-T Rule 101(b)(7): ☐
Note: RegulationS-T Rule 101(b)(7) only permits the submission in paper of a Form6-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 Form6-K submission or other Commission filing on EDGAR.
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1.1. | ||||||
1.2. | ||||||
1.3. | ||||||
1.4. | ||||||
1.5. | ||||||
2. | ||||||
2.1. | ||||||
2.2. | ||||||
2.3. | Other Information to Consider in Making an Investment Decision | |||||
3. | ||||||
3.1. | ||||||
3.2. | ||||||
3.3. | ||||||
3.4. | ||||||
4. | ||||||
4.1. | ||||||
4.2. | Public Company Accounting Oversight Board (“PCAOB”) Audit Services | |||||
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5.1. | ||||||
5.2. | ||||||
5.3. | ||||||
5.4. | ||||||
5.5. | ||||||
6. | ||||||
6.1. | ||||||
6.2. | ||||||
6.3. | ||||||
6.4. | ||||||
6.5. | ||||||
7. | ||||||
7.1. | ||||||
7.2. | ||||||
7.3. | ||||||
7.4. | ||||||
7.5. | ||||||
Summary of Business Report for Fiscal Year 2018
On April 1, 2019, KB Financial Group Inc. (“KB Financial Group”) filed its business report for the fiscal year ended December 31, 2018 (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.
| 1. | Introduction to the Company |
| 1.1. | Business Purpose |
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, as well as the credit card business, the financial investment business, the insurance business and other related businesses.
| 1.2. | History |
| • | 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
| • | September 28, 2009 |
AddedBurrill-KB Life Sciences Fund Ltd. as a second-tier subsidiary
| • | December 1, 2009 |
AddedKB-Glenwood Private Equity Fund No.1 as a second-tier subsidiary
| • | January 22, 2010 |
The largest shareholder of the Company changed from the Korean National Pension Service to ING Bank N.V.
| • | July 6, 2010 |
Added KBIC Private Equity Fund No. 3 as a second-tier subsidiary
| • | December 13, 2010 |
Added KoFC KBIC Frontier Champ2010-5 PEF as a second-tier subsidiary
| • | March 2, 2011 |
Added KB Kookmin Card Co., Ltd. (“KB Kookmin Card”) as a first-tier subsidiary
| • | 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
| • | November 12, 2011 |
Closed KB Investment & Securities Hong Kong Ltd.
| • | 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
| • | June 8, 2012 |
LiquidatedBurrill-KB Life Sciences Fund Ltd.
| • | July 2, 2012 |
Added KoFCValue-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
| • | July 2, 2014 |
Added Korea GCC Global Cooperation Private Equity Fund as a second-tier subsidiary
| • | June 24, 2015 |
Added KB Insurance Co., Ltd. (“KB Insurance”) as anon-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 anon-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%
| • | September 9, 2016 |
LiquidatedNPS-KBIC No. 1 Private Equity Fund
| • | November 29, 2016 |
Established KB Golden Life Care Co., Ltd. as a second-tier subsidiary
| • | December 22, 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”)
| • | January 4, 2017 |
Converted Kookmin Bank Hong Kong Ltd., a subsidiary, into Kookmin Bank Hong Kong Branch
| • | 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
| • | March 22, 2017 |
Liquidated KBIC Private Equity Fund No. 3, 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%
| • | June 20, 2017 |
Liquidated Korea GCC Global Cooperation Private Equity Fund, a second-tier subsidiary
| • | 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 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 |
AddedKB-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)
| • | May 16, 2018 |
Converted Kookmin Bank International Ltd., a subsidiary, into Kookmin Bank London Branch (liquidation in progress)
| • | July 6, 2018 |
Liquidated Hyundai-Tongyang Agrifood Private Equity Fund, a second-tier subsidiary
| • | 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
| • | December 31, 2018 |
AddedKB-Stonebridge Secondary Private Equity Fund as a second-tier subsidiary
| • | January 9, 2019 |
AddedKB-SPROTT Renewable Private Equity Fund I as a second-tier subsidiary
| • | February 22, 2019 |
Liquidated KoFC KBIC Frontier Champ 2010-5 PEF, a second-tier subsidiary
| 1.3. | Overview of the Business Group |
| (As of December 31, 2018) | ||||||
Type | Name of Company | Controlling Company | Remarks | |||
Holding Company | KB Financial Group | - | Listed | |||
1st Tier Subsidiaries | Kookmin Bank | KB Financial Group | Not listed | |||
| KB Securities Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Insurance Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Kookmin Card Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Asset Management Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Capital Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Life Insurance Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Real Estate Trust Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Savings Bank Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Investment Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Data Systems Co., Ltd. | KB Financial Group | Not listed | ||||
| KB Credit Information Co., Ltd. | KB Financial Group | Not listed | ||||
2nd Tier Subsidiaries | Kookmin Bank Cambodia PLC | Kookmin Bank | Not listed (Overseas) | |||
| Kookmin Bank (China) Ltd. | Kookmin Bank | Not listed (Overseas) | ||||
| KB Microfinance Myanmar Co., Ltd. | Kookmin Bank | Not listed (Overseas) | ||||
| KBFG Securities America Inc. | KB Securities | Not listed (Overseas) | ||||
| KB Securities Hong Kong Ltd. | KB Securities | Not listed (Overseas) | ||||
| Keystone-Hyundai Securities No. 1 Private Equity Fund | KB Securities | Not listed | ||||
| KB-IGen Private Equity Fund No.1 | KB Securities | Not listed | ||||
| KB Private Equity Fund III | KB Securities | Not listed | ||||
| KB SECURITIES VIETNAM JOINT STOCK COMPANY | KB Securities | Not listed (Overseas) | ||||
| KB-TS Technology Venture Private Equity Fund | KB Securities | Not listed | ||||
| KB-Stonebridge Secondary Private Equity Fund | KB Securities | Not listed | ||||
| KB-SPROTT Renewable Private Equity Fund I | KB Securities | Not listed | ||||
| KB Claims Survey & Adjusting Co., Ltd. | KB Insurance | Not listed | ||||
| KB Sonbo CNS | KB Insurance | Not listed | ||||
| Leading Insurance Services, Inc. | KB Insurance | Not listed (Overseas) | ||||
| LIG Insurance (China) Co., Ltd. | KB Insurance | Not listed (Overseas) | ||||
| PT. Kookmin Best Insurance Indonesia | KB Insurance | Not listed (Overseas) | ||||
| KB Golden Life Care Co., Ltd. | KB Insurance | Not listed | ||||
| KB Daehan Specialized Bank Plc. | KB Kookmin Card | Not listed (Overseas) | ||||
| KB Asset Management Singapore Pte. Ltd. | KB Asset Management | Not listed (Overseas) | ||||
| KBAM Shanghai Advisory Services Co., Ltd. | KB Asset Management | Not listed (Overseas) | ||||
| KB KOLAO LEASING Co., Ltd. | KB Capital | Not listed (Overseas) | ||||
| KoFC POSCO HANWHA KB Shared Growth No. 2. Private Equity Fund | KB Investment | Not listed | ||||
| KoFCValue-up Private Equity Fund | KB Investment | Not listed | ||||
| 1.4. | Capital Structure |
| 1.4.1. | Common Shares |
Changes in Capital
| (As of December 31, 2018) | (Unit: Won, shares) |
Issue Date | Type | Number of Shares | Par Value | Issue Price | Remarks | |||||||||||
September 29, 2008 | Common Stock | 356,351,693 | 5,000 | 48,444 | Establishment of the Company | |||||||||||
September 2, 2009 | Common Stock | 30,000,000 | 5,000 | 37,250 | Rights offering to existing shareholders; % increase in number of common shares: 8.41865% | |||||||||||
October 19, 2016 | Common Stock | 31,759,844 | 5,000 | 35,474 | Stock Swap; % increase in number of common shares: 8.22045% | |||||||||||
Number of Shares
| (As of December 31, 2018) | (Unit: shares) | |||||||||||
| Type | ||||||||||||
| Common Stock | Other Stock | Total | ||||||||||
Shares Authorized for Issuance | 1,000,000,000 | — | 1,000,000,000 | |||||||||
Shares Issued (A) | 418,111,537 | — | 418,111,537 | |||||||||
Treasury Shares (B) | 22,415,468 | — | 22,415,468 | |||||||||
Shares Outstanding(A-B) | 395,696,069 | — | 395,696,069 | |||||||||
Note:The board of directors of the Company resolved to enter into a trust agreement to acquire treasury shares on February 4, 2016, August 2, 2016, November 24, 2017, and November 30, 2018. For more information, please refer to the Company’s reports on Form6-K furnished to the Securities and Exchange Commission on each respective date.
| 1.4.2. | Voting Rights |
| (As of December 31, 2018) | ||||||||
Items | Number of Shares | Notes | ||||||
Total number of issued shares | Common shares | 418,111,537 | — | |||||
| Preferred shares | — | — | ||||||
Shares without voting rights | Common shares | 22,415,468 | Treasury shares | |||||
| Preferred shares | — | — | ||||||
Shares for which voting rights cannot be exercised pursuant to the Articles of Incorporation | — | — | — | |||||
Shares for which voting rights are restricted under relevant laws and regulations | — | — | — | |||||
| — | — | — | ||||||
Shares with restored voting rights | — | — | — | |||||
Total shares for which voting rights may be exercised | Common shares | 395,696,069 | — | |||||
| Preferred shares | — | — | ||||||
| 1.5. | Dividends |
| (Unit: in millions of Won, except per share amount) | ||||||||||||||
Items | January 1, 2018 to December 31, 2018 | January 1, 2017 to December 31, 2017 | January 1, 2016 to December 31, 2016 | |||||||||||
Par value per share (Won) | 5,000 | 5,000 | 5,000 | |||||||||||
(Consolidated) Net income | 3,061,191 | 3,311,438 | 2,143,744 | |||||||||||
(Consolidated) Earnings per share (Won) | 7,721 | 8,305 | 5,588 | |||||||||||
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Total cash dividends | 759,736 | 766,728 | 497,969 | |||||||||||
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Total stock dividends | — | — | — | |||||||||||
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(Consolidated) Cash dividend payout ratio (%) | 24.8 | 23.2 | 23.2 | |||||||||||
Cash dividend yield (%) | Common Shares | 4.0 | 3.1 | 2.9 | ||||||||||
| — | — | — | — | |||||||||||
Stock dividend yield (%) | Common Shares | — | — | — | ||||||||||
| — | — | — | — | |||||||||||
Cash dividend per share (Won) | Common Shares | 1,920 | 1,920 | 1,250 | ||||||||||
| — | — | — | — | |||||||||||
Stock dividend per share | Common Shares | — | — | — | ||||||||||
| — | — | — | — | |||||||||||
| 2. | Business |
| 2.1. | Results of Operations |
| (Unit: in millions of Won) | ||||||||||||
| For the year ended | For the year ended | For the year ended | ||||||||||
| December 31, 2018 | December 31, 2017 | December 31, 2016 | ||||||||||
Net interest income | 8,904,928 | 8,246,614 | 6,715,606 | |||||||||
Interest income | 13,734,569 | 11,919,057 | 10,334,959 | |||||||||
Interest expense | (4,829,641 | ) | (3,672,443 | ) | (3,619,353 | ) | ||||||
Net fee and commission income | 2,243,376 | 2,050,024 | 1,584,892 | |||||||||
Fee and commission income | 3,717,720 | 3,988,250 | 3,150,877 | |||||||||
Fee and commission expense | (1,474,344 | ) | (1,938,226 | ) | (1,565,985 | ) | ||||||
Net insurance income | 490,116 | 593,710 | (117,803 | ) | ||||||||
Insurance income | 11,975,070 | 8,970,992 | 1,201,352 | |||||||||
Insurance expense | (11,484,954 | ) | (8,377,282 | ) | (1,319,155 | ) | ||||||
Net gains(losses) on financial assets/liabilities at fair value through profit or loss (underK-IFRS 1039) | — | 203,724 | (321,845 | ) | ||||||||
Net gains(losses) on financial assets/liabilities at fair value through profit or loss | 351,303 | — | — | |||||||||
Net other operating expenses | (1,130,036 | ) | (901,890 | ) | (415,908 | ) | ||||||
General and administrative expenses | (5,918,512 | ) | (5,628,664 | ) | (5,228,711 | ) | ||||||
Operating profit before provision for credit losses | 4,941,175 | 4,563,518 | 2,216,231 | |||||||||
Provision for credit losses | (673,694 | ) | (548,244 | ) | (539,283 | ) | ||||||
Net operating profit | 4,267,481 | 4,015,274 | 1,676,948 | |||||||||
| Note: | The consolidated financial information for the year ended December 31, 2018 is based onK-IFRS 1109 and 1115. The corresponding financial information for prior years has not been restated. |
| 2.2. | Sources and Uses of Funds |
2.2.1. Sources of Funds
| (Unit: in millions of Won) | ||||||||||||||||||||||||||||||||||||||
| For the year ended December 31, 2018 | For the year ended December 31, 2017 | For the year ended December 31, 2016 | ||||||||||||||||||||||||||||||||||||
| Average Balance | Interest Rate (%) | Ratio (%) | Average Balance | Interest Rate (%) | Ratio (%) | Average Balance | Interest Rate (%) | Ratio (%) | ||||||||||||||||||||||||||||||
Won Currency | Deposits | 238,468,014 | 1.39 | 52.82 | 219,970,681 | 1.20 | 54.26 | 207,194,480 | 1.32 | 60.76 | ||||||||||||||||||||||||||||
Certificate of deposit | 3,044,609 | 1.91 | 0.67 | 2,862,817 | 1.57 | 0.71 | 3,386,647 | 1.65 | 0.99 | |||||||||||||||||||||||||||||
Borrowings | 10,312,988 | 1.59 | 2.28 | 9,306,125 | 1.41 | 2.30 | 6,803,292 | 1.54 | 2.00 | |||||||||||||||||||||||||||||
Call money | 1,437,887 | 1.53 | 0.32 | 2,165,151 | 1.26 | 0.53 | 1,414,780 | 1.35 | 0.41 | |||||||||||||||||||||||||||||
Debentures | 44,072,110 | 2.29 | 9.76 | 36,393,274 | 2.17 | 8.98 | 30,075,804 | 2.49 | 8.82 | |||||||||||||||||||||||||||||
Others | 16,665,395 | 1.60 | 3.69 | 13,735,978 | 1.41 | 3.38 | 7,700,215 | 1.45 | 2.26 | |||||||||||||||||||||||||||||
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Subtotal | 314,001,003 | 1.54 | 69.54 | 284,434,026 | 1.35 | 70.16 | 256,575,218 | 1.47 | 75.24 | |||||||||||||||||||||||||||||
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Foreign Currency | Deposits | 11,039,672 | 1.15 | 2.45 | 10,156,743 | 0.80 | 2.51 | 8,713,640 | 0.53 | 2.56 | ||||||||||||||||||||||||||||
Borrowings | 8,249,765 | 2.02 | 1.83 | 6,438,408 | 1.17 | 1.59 | 5,644,047 | 0.78 | 1.66 | |||||||||||||||||||||||||||||
Call money | 751,171 | 2.35 | 0.17 | 1,239,627 | 1.39 | 0.31 | 1,161,517 | 0.72 | 0.34 | |||||||||||||||||||||||||||||
Debentures | 4,076,096 | 3.40 | 0.90 | 3,374,998 | 2.71 | 0.83 | 4,139,036 | 2.55 | 1.21 | |||||||||||||||||||||||||||||
Others | 297,657 | 0.89 | 0.07 | 321,263 | 0.56 | 0.07 | 222,098 | 0.94 | 0.06 | |||||||||||||||||||||||||||||
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Subtotal | 24,414,361 | 1.85 | 5.42 | 21,531,039 | 1.24 | 5.31 | 19,880,338 | 1.04 | 5.83 | |||||||||||||||||||||||||||||
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Others | Total shareholders’ equity | 35,690,200 | — | 7.90 | 34,785,839 | — | 8.58 | 30,308,008 | — | 8.89 | ||||||||||||||||||||||||||||
Allowances | 750,262 | — | 0.17 | 829,075 | — | 0.20 | 748,594 | — | 0.22 | |||||||||||||||||||||||||||||
Others | 76,643,695 | — | 16.97 | 63,855,888 | — | 15.75 | 33,476,080 | — | 9.82 | |||||||||||||||||||||||||||||
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Subtotal | 113,084,157 | — | 25.04 | 99,470,802 | — | 24.53 | 64,532,682 | — | 18.93 | |||||||||||||||||||||||||||||
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Total | 451,499,521 | — | 100.00 | 405,435,867 | — | 100.00 | 340,988,238 | — | 100.00 | |||||||||||||||||||||||||||||
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Note: Based onK-IFRS (on a consolidated basis).
2.2.2. Uses of Funds
| (Unit: in millions of Won) | ||||||||||||||||||||||||||||||||||||||
| For the year ended December 31, 2018 | For the year ended December 31, 2017 | For the year ended December 31, 2016 | ||||||||||||||||||||||||||||||||||||
| Average Balance | Interest Rate (%) | Ratio (%) | Average Balance | Interest Rate (%) | Ratio (%) | Average Balance | Interest Rate (%) | Ratio (%) | ||||||||||||||||||||||||||||||
Won Currency | Due from banks | 4,817,024 | 1.43 | 1.07 | 6,757,757 | 1.44 | 1.67 | 6,075,873 | 1.52 | 1.78 | ||||||||||||||||||||||||||||
| Securities | 95,395,973 | 2.84 | 21.13 | 80,406,670 | 1.81 | 19.83 | 55,999,995 | 2.12 | 16.42 | |||||||||||||||||||||||||||||
| Loans | 269,569,916 | 3.43 | 59.71 | 247,117,982 | 3.28 | 60.95 | 225,153,667 | 3.15 | 66.03 | |||||||||||||||||||||||||||||
| Guarantee payments under payment guarantee | 8,206 | 1.87 | — | 17,008 | 0.66 | — | 28,005 | 1.16 | 0.01 | |||||||||||||||||||||||||||||
| Call loan | 632,317 | 1.48 | 0.14 | 315,950 | 1.28 | 0.08 | 399,843 | 1.43 | 0.12 | |||||||||||||||||||||||||||||
| Private placement corporate bonds | 1,452,396 | 3.44 | 0.32 | 1,801,681 | 4.00 | 0.44 | 1,081,692 | 3.99 | 0.32 | |||||||||||||||||||||||||||||
| Credit cards | 16,722,691 | 8.15 | 3.70 | 14,877,741 | 8.32 | 3.67 | 12,823,200 | 8.66 | 3.76 | |||||||||||||||||||||||||||||
| Others | 4,209,878 | 4.08 | 0.93 | 4,123,143 | 3.87 | 1.02 | 5,061,229 | 4.96 | 1.48 | |||||||||||||||||||||||||||||
| Allowance | (2,434,872 | ) | — | (0.54 | ) | (2,116,366 | ) | — | (0.52 | ) | (2,182,313 | ) | — | (0.64 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Subtotal | 390,373,529 | 3.49 | 86.46 | 353,301,566 | 3.15 | 87.14 | 304,441,191 | 3.21 | 89.28 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Foreign Currency | Due from banks | 3,666,805 | 1.36 | 0.81 | 2,862,165 | 1.06 | 0.71 | 2,553,722 | 0.75 | 0.75 | ||||||||||||||||||||||||||||
| Securities | 12,704,025 | 2.47 | 2.81 | 10,013,637 | 3.19 | 2.47 | 3,792,545 | 2.61 | 1.11 | |||||||||||||||||||||||||||||
| Loans | 8,050,597 | 2.96 | 1.78 | 7,136,381 | 2.29 | 1.76 | 8,125,102 | 1.76 | 2.38 | |||||||||||||||||||||||||||||
| Call loan | 2,553,987 | 2.38 | 0.57 | 2,909,920 | 1.53 | 0.72 | 2,220,839 | 0.65 | 0.65 | |||||||||||||||||||||||||||||
| Bills bought | 4,113,332 | 1.93 | 0.91 | 3,166,307 | 1.51 | 0.78 | 2,768,692 | 1.30 | 0.81 | |||||||||||||||||||||||||||||
| Allowance | (262,835 | ) | — | (0.06 | ) | (173,771 | ) | — | (0.04 | ) | (328,130 | ) | — | (0.10 | ) | |||||||||||||||||||||||
| Others | 153,277 | — | 0.03 | 72,297 | — | 0.01 | 24,789 | — | 0.02 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Subtotal | 30,979,188 | 2.41 | 6.85 | 25,986,936 | 2.35 | 6.41 | 19,157,559 | 1.64 | 5.62 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Others | Cash | 1,769,656 | — | 0.39 | 1,726,448 | — | 0.43 | 1,724,701 | — | 0.51 | ||||||||||||||||||||||||||||
| Fixed assets held for business | 5,639,374 | — | 1.25 | 5,826,159 | — | 1.44 | 3,464,031 | — | 1.02 | |||||||||||||||||||||||||||||
| Others | 22,737,774 | — | 5.05 | 18,594,758 | — | 4.58 | 12,200,756 | — | 3.57 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Subtotal | 30,146,804 | — | 6.69 | 26,147,365 | — | 6.45 | 17,389,488 | — | 5.10 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Total | 451,499,521 | — | 100.00 | 405,435,867 | — | 100.00 | 340,988,238 | — | 100.00 | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Note: Based onK-IFRS (on a consolidated basis).
| 2.3. | Other Information to Consider in Making an Investment Decision |
2.3.1. Capital Adequacy
| KB Financial Group | (Unit: in billions of Won) | |||||||||||
| As of December 31, 2018 | As of December 31, 2017 | As of December 31, 2016 | ||||||||||
Total Capital (A) | 34,476 | 32,402 | 31,103 | |||||||||
Risk-weighted assets (B) | 236,099 | 212,777 | 203,649 | |||||||||
BIS ratio (A/B) | 14.60 | % | 15.23 | % | 15.27 | % | ||||||
| Note: | Calculated in accordance with Basel III. |
| Kookmin Bank | (Unit: in billions of Won) | |||||||||||
| As of December 31, 2018 | As of December 31, 2017 | As of December 31, 2016 | ||||||||||
Total capital (A) | 27,694 | 25,914 | 24,579 | |||||||||
Risk-weighted assets (B) | 178,433 | 161,825 | 150,649 | |||||||||
BIS ratio (A/B) | 15.52 | % | 16.01 | % | 16.32 | % | ||||||
| Note: | Calculated in accordance with Basel III. |
| KB Securities | (Unit: in billions of Won) | |||||||||||
| As of December 31, 2018 | As of December 31, 2017 | As of December 31, 2016 | ||||||||||
Net operating capital (A) | 2,969 | 3,211 | 2,844 | |||||||||
Total amount at risk (B) | 1,251 | 1,048 | 866 | |||||||||
Maintenance equity margin (C) | 134 | 134 | 134 | |||||||||
Net capital ratio(A-B)/(C) | 1,278.45 | % | 1,609.03 | % | 1,471.73 | % | ||||||
Capital surplus(A-B) | 1,718 | 2,163 | 1,978 | |||||||||
| Note: | Calculated in accordance with amended net capital ratio standards effective as of January 2015. |
| KB Insurance | (Unit: in billions of Won) | |||||||||||
| As of December 31, 2018 | As of December 31, 2017 | As of December 31, 2016 | ||||||||||
Available capital (A) | 3,333 | 3,080 | 2,774 | |||||||||
Required capital (B) | 1,782 | 1,618 | 1,644 | |||||||||
RBC ratio (A/B) | 187.1 | % | 190.3 | % | 168.7 | % | ||||||
| Note: | RBC ratio: Risk-Based Capital ratio. |
2.3.2. Credit Ratings
Date of Rating | Type | Credit Rating | Rating Company (Rating Range) | |||
| 5/11/2016 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 6/24/2016 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 6/30/2016 | Commercial Paper | A1 | Korea Ratings (A1 ~ D) / KIS Ratings (A1 ~ D) / NICE Investors Service (A1 ~ D) | |||
| 7/22/2016 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 8/24/2016 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 11/25/2016 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 1/24/2017 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 2/24/2017 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 4/5/2017 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 5/23/2017 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 6/23/2017 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 6/23/2017 | Commercial Paper | A1 | Korea Ratings (A1 ~ D) / KIS Ratings (A1 ~ D) / NICE Investors Service (A1 ~ D) | |||
| 8/28/2017 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 1/24/2018 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 2/27/2018 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 4/5/2018 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 6/11/2018 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 6/25/2018 | Commercial Paper | A1 | Korea Ratings (A1 ~ D) / KIS Ratings (A1 ~ D) / NICE Investors Service (A1 ~ D) | |||
| 7/24/2018 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 10/4/2018 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
| 2/21/2019 | Debentures | AAA | Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D) | |||
2.3.3. Early Retirement Program
To enhance productivity by improving its labor structure, Kookmin Bank implemented a voluntary early retirement program following negotiations with its labor union.
Date of retirement | Number of retired persons | |
| January 23, 2017 | 2,750 | |
| January 19, 2018 | 404 | |
| January 28, 2019 | 613 |
2.3.4. Acquisition of Shares of Bank Bukopin of Indonesia
Kookmin Bank entered into a share subscription agreement with Bank Bukopin of Indonesia on June 26, 2018 and acquired its new shares on July 27, 2018.
| (Unit: in millions of Won) | ||
Ownership | Acquisition amount | |
| 22% | 116,422* (IDR 1,460,910,000,000) |
| * | The acquisition amount in IDR is converted to Won at the exchange rate on July 27, 2018, the acquisition date. |
| 3. | Financial Information |
| 3.1. | Consolidated Financial Information |
3.1.1. Consolidated Statements of Financial Position
| (Unit: in millions of Won) | ||||||||||||
| As of December 31, 2018 | As of December 31, 2017 | As of December 31, 2016 | ||||||||||
Cash and due from financial institutions | 20,274,490 | 19,817,825 | 17,884,863 | |||||||||
Financial assets at fair value through profit or loss (underK-IFRS 1039) | — | 32,227,345 | 27,858,364 | |||||||||
Financial assets at fair value through profit or loss | 50,987,847 | — | — | |||||||||
Derivative financial assets | 2,025,962 | 3,310,166 | 3,381,935 | |||||||||
Loans at amortized cost | 319,201,603 | 290,122,838 | 265,486,134 | |||||||||
Financial investments | 61,665,094 | 66,608,243 | 45,147,797 | |||||||||
Investments in associates and joint ventures | 504,932 | 335,070 | 1,770,673 | |||||||||
Property and equipment | 4,272,127 | 4,201,697 | 3,627,268 | |||||||||
Investment property | 2,119,811 | 848,481 | 755,011 | |||||||||
Intangible assets | 2,755,783 | 2,943,060 | 652,316 | |||||||||
Net defined benefit assets | — | 894 | — | |||||||||
Current income tax assets | 10,004 | 6,324 | 65,738 | |||||||||
Deferred income tax assets | 4,158 | 3,991 | 133,624 | |||||||||
Assets held for sale | 16,952 | 155,506 | 52,148 | |||||||||
Other assets | 15,749,535 | 16,204,169 | 8,857,785 | |||||||||
|
|
|
|
|
| |||||||
Total assets | 479,588,298 | 436,785,609 | 375,673,656 | |||||||||
|
|
|
|
|
| |||||||
Financial liabilities at fair value through profit or loss (underK-IFRS 1039) | — | 12,023,058 | 12,122,836 | |||||||||
Financial liabilities at fair value through profit or loss | 15,326,859 | — | — | |||||||||
Derivative financial liabilities | 2,901,247 | 3,142,765 | 3,807,128 | |||||||||
Deposits | 276,770,449 | 255,800,048 | 239,729,695 | |||||||||
Debts | 33,004,834 | 28,820,928 | 26,251,486 | |||||||||
Debentures | 53,278,697 | 44,992,724 | 34,992,057 | |||||||||
Provisions | 525,859 | 568,033 | 537,717 | |||||||||
Net defined benefit liabilities | 262,213 | 154,702 | 96,299 | |||||||||
Current income tax liabilities | 698,634 | 433,870 | 441,812 | |||||||||
Deferred income tax liabilities | 492,534 | 533,069 | 103,482 | |||||||||
Insurance contract liabilities | 33,412,949 | 31,801,275 | 7,290,844 | |||||||||
Other liabilities | 27,200,996 | 24,470,308 | 19,038,897 | |||||||||
|
|
|
|
|
| |||||||
Total liabilities | 443,875,271 | 402,740,780 | 344,412,253 | |||||||||
|
|
|
|
|
| |||||||
Equity attributable to shareholders of the parent company | 35,703,916 | 34,038,685 | 30,998,044 | |||||||||
Share capital | 2,090,558 | 2,090,558 | 2,090,558 | |||||||||
Capital surplus | 17,121,660 | 17,122,228 | 16,994,902 | |||||||||
Accumulated other comprehensive income | 177,806 | 537,668 | 405,329 | |||||||||
Retained earnings | 17,282,441 | 15,044,204 | 12,229,228 | |||||||||
Treasury shares | (968,549 | ) | (755,973 | ) | (721,973 | ) | ||||||
Non-controlling interests | 9,111 | 6,144 | 263,359 | |||||||||
|
|
|
|
|
| |||||||
Total equity | 35,713,027 | 34,044,829 | 31,261,403 | |||||||||
|
|
|
|
|
| |||||||
Total liabilities and equity | 479,588,298 | 436,785,609 | 375,673,656 | |||||||||
|
|
|
|
|
| |||||||
| Note: | The consolidated financial information as of December 31, 2018 is based onK-IFRS 1109 and 1115. The corresponding financial information as of prior dates has not been restated. |
3.1.2. Consolidated Statements of Comprehensive Income
| (Unit: in millions of Won, except per share amounts) | ||||||||||||
| For the year ended December 31, 2018 | For the year ended December 31, 2017 | For the year ended December 31, 2016 | ||||||||||
Net interest income | 8,904,928 | 8,246,614 | 6,715,606 | |||||||||
Net fee and commission income | 2,243,376 | 2,050,024 | 1,584,892 | |||||||||
Net insurance income(expense) | 490,116 | 593,710 | (117,803 | ) | ||||||||
Net gains(losses) on financial assets/liabilities at fair value through profit or loss (underK-IFRS 1039) | — | 203,724 | (321,845 | ) | ||||||||
Net gains(losses) on financial assets/liabilities at fair value through profit or loss | 351,303 | — | — | |||||||||
Net other operating expenses | (1,130,036 | ) | (901,890 | ) | (415,908 | ) | ||||||
General and administrative expenses | (5,918,512 | ) | (5,628,664 | ) | (5,228,711 | ) | ||||||
Operating profit before provision for credit losses | 4,941,175 | 4,563,518 | 2,216,231 | |||||||||
Provision for credit losses | (673,694 | ) | (548,244 | ) | (539,283 | ) | ||||||
Net operating income | 4,267,481 | 4,015,274 | 1,676,948 | |||||||||
Netnon-operating income(loss) | 34,051 | 123,150 | 951,707 | |||||||||
Profit before income tax | 4,301,532 | 4,138,424 | 2,628,655 | |||||||||
Income tax expense | (1,239,586 | ) | (794,963 | ) | (438,475 | ) | ||||||
Profit for the period | 3,061,946 | 3,343,461 | 2,190,180 | |||||||||
Other comprehensive income (loss) for the period, net of tax | (10,482 | ) | 136,226 | (24,937 | ) | |||||||
|
|
|
|
|
| |||||||
Total comprehensive income for the period | 3,051,464 | 3,479,687 | 2,165,243 | |||||||||
|
|
|
|
|
| |||||||
Profit attributable to: | 3,061,946 | 3,343,461 | 2,190,180 | |||||||||
Shareholders of the parent company | 3,061,191 | 3,311,438 | 2,143,744 | |||||||||
Non-controlling interests | 755 | 32,023 | 46,436 | |||||||||
|
|
|
|
|
| |||||||
Total comprehensive income for the period attributable to: | 3,051,464 | 3,479,687 | 2,165,243 | |||||||||
|
|
|
|
|
| |||||||
Shareholders of the parent company | 3,050,805 | 3,445,285 | 2,118,829 | |||||||||
Non-controlling interests | 659 | 34,402 | 46,414 | |||||||||
Earnings per share | ||||||||||||
Basic earnings per share (Won) | 7,721 | 8,305 | 5,588 | |||||||||
Diluted earnings per share (Won) | 7,676 | 8,257 | 5,559 | |||||||||
| Note: | The consolidated financial information for the year ended December 31, 2018 is based onK-IFRS 1109 and 1115. The corresponding financial information for previous periods has not been restated. |
3.2. Separate Financial Information
3.2.1. Separate Statements of Financial Position
| (Unit: in millions of Won) | ||||||||||||
| As of December 31, 2018 | As of December 31, 2017 | As of December 31, 2016 | ||||||||||
Cash and due from financial institutions | 344,302 | 245,400 | 115,065 | |||||||||
Financial assets at fair value through profit or loss (underK-IFRS 1039) | — | 284,485 | 246,656 | |||||||||
Financial assets at fair value through profit or loss | 289,179 | — | — | |||||||||
Loans at amortized cost | 50,000 | 10,000 | 29,415 | |||||||||
Investments in subsidiaries | 24,062,116 | 24,062,116 | 21,392,745 | |||||||||
Investments in associates | — | — | 1,053,690 | |||||||||
Property and equipment | 2,185 | 697 | 469 | |||||||||
Intangible assets | 9,646 | 8,864 | 8,092 | |||||||||
Net defined benefit assets | — | 201 | 193 | |||||||||
Deferred income tax assets | 8,184 | 10,282 | 4,604 | |||||||||
Other assets | 857,462 | 480,789 | 519,223 | |||||||||
|
|
|
|
|
| |||||||
Total assets | 25,623,074 | 25,102,834 | 23,370,152 | |||||||||
|
|
|
|
|
| |||||||
Debts | 300,000 | 300,000 | 350,000 | |||||||||
Debentures | 5,373,266 | 5,162,600 | 3,474,200 | |||||||||
Net defined benefit liabilities | 183 | — | — | |||||||||
Current income tax liabilities | 691,909 | 308,854 | 419,607 | |||||||||
Other liabilities | 186,481 | 204,835 | 104,528 | |||||||||
|
|
|
|
|
| |||||||
Total liabilities | 6,551,839 | 5,976,289 | 4,348,335 | |||||||||
|
|
|
|
|
| |||||||
Share capital | 2,090,558 | 2,090,558 | 2,090,558 | |||||||||
Capital surplus | 14,742,814 | 14,742,814 | 14,656,168 | |||||||||
Accumulated other comprehensive loss | (7,144 | ) | (5,233 | ) | (4,742 | ) | ||||||
Retained earnings | 3,213,556 | 3,054,379 | 2,998,923 | |||||||||
Treasury Shares | (968,549 | ) | (755,973 | ) | (719,090 | ) | ||||||
|
|
|
|
|
| |||||||
Total equity | 19,071,235 | 19,126,545 | 19,021,817 | |||||||||
|
|
|
|
|
| |||||||
Total liabilities and equity | 25,623,074 | 25,102,834 | 23,370,152 | |||||||||
|
|
|
|
|
| |||||||
| Note: | The separate financial information as of December 31, 2018 is based onK-IFRS 1109 and 1115. The corresponding financial information as of prior dates has not been restated. |
3.2.2. Separate Statements of Comprehensive Income
| (Unit: in millions of Won, except per share amounts) | ||||||||||||
| For the year ended December 31, 2018 | For the year ended December 31, 2017 | For the year ended December 31, 2016 | ||||||||||
Net interest expense | (115,835 | ) | (97,218 | ) | (55,924 | ) | ||||||
Net fee and commission expense | (5,208 | ) | (7,808 | ) | (7,214 | ) | ||||||
Net gains on financial assets at fair value through profit or loss (underK-IFRS 1039) | — | 745 | 5,272 | |||||||||
Net gains on financial assets at fair value through profit or loss | 18,319 | — | — | |||||||||
Net other operating income | 1,089,556 | 709,544 | 694,908 | |||||||||
General and administrative expenses | (57,845 | ) | (57,485 | ) | (46,734 | ) | ||||||
Operating profit before provision for credit losses | 928,987 | 547,778 | 590,308 | |||||||||
Provision for credit losses | — | — | — | |||||||||
Operating profit | 928,987 | 547,778 | 590,308 | |||||||||
Netnon-operating expense | (259 | ) | 125 | (340 | ) | |||||||
Profit before income tax | 928,728 | 547,903 | 589,968 | |||||||||
Income tax benefit (expense) | (2,823 | ) | 5,522 | 164 | ||||||||
Profit for the period | 925,905 | 553,425 | 590,132 | |||||||||
Other comprehensive income (loss) for the period, net of tax | (1,911 | ) | (491 | ) | 237 | |||||||
|
|
|
|
|
| |||||||
Total comprehensive income for the period | 923,994 | 552,934 | 590,369 | |||||||||
|
|
|
|
|
| |||||||
Earnings per share | ||||||||||||
Basic earnings per share (Won) | 2,335 | 1,388 | 1,538 | |||||||||
Diluted earnings per share (Won) | 2,322 | 1,380 | 1,530 | |||||||||
| Note: | The separate financial information for the year ended December 31, 2018 is based onK-IFRS 1109 and 1115. The corresponding financial information for prior years has not been restated. |
| 3.3. | Other Selected Financial Data |
3.3.1.Won-denominated Liquidity Ratio
| (Unit: in millions of Won) | ||||||||||||
Category | As of December 31, 2018 | As of December 31, 2017 | As of December 31, 2016 | |||||||||
Current assets in Won (A) | 30,150 | 47,253 | 59,429 | |||||||||
Current liabilities in Won (B) | 9,300 | 6,792 | 5,554 | |||||||||
Liquidity ratio (A/B) | 324.20 | % | 695.72 | % | 1,070.02 | % | ||||||
| Note: | 1) Based onK-IFRS (on a separate basis). |
2) Calculated based onWon-denominated assets and liabilities due within one month.
3.3.2. Profitability Ratios
| (Unit: %) | ||||||||||||
Category | For the year ended December 31, 2018 | For the year ended December 31, 2017 | For the year ended December 31, 2016 | |||||||||
Net income as a percentage of average total assets (ROA) | 0.66 | 0.82 | 0.63 | |||||||||
Net income as a percentage of average shareholders’ equity (ROE) | 8.82 | 10.18 | 7.26 | |||||||||
| Note: | Based onK-IFRS (on a consolidated basis). |
3.3.3. 20 Largest Exposures of Kookmin Bank by Borrower
| (As of December 31, 2018) | ||||
Company | Credit extended | |||
| (Unit: in billions of Won) | ||||
Samsung Electronics Co., Ltd. | 1,593 | |||
LG Display Co., Ltd. | 1,025 | |||
Hyundai Motor Company | 935 | |||
Hyundai Steel Co., Ltd. | 802 | |||
Korea Securities Finance Corp. | 705 | |||
GS Caltex Corporation. | 680 | |||
Hyundai Capital Services, Inc. | 668 | |||
S-OIL Corporation | 611 | |||
LG Electronics Inc. | 578 | |||
Lotte Corporation. | 501 | |||
Kia Motors Corporation | 498 | |||
Shinsegae Inc. | 411 | |||
Samsung Display Co., Ltd. | 404 | |||
Shinhan Financial Group Co., Ltd. | 390 | |||
Lotte Property & Development Co., Ltd. | 380 | |||
SK Energy Co., Ltd. | 372 | |||
BANK OF COMMUNICATIONS | 352 | |||
Hyundai Mobis Co., Ltd. | 337 | |||
Korea Railroad Corporation | 336 | |||
KT Corporation | 335 | |||
|
| |||
Total | 11,913 | |||
|
| |||
3.3.4. 10 Largest Exposures of Kookmin Bank by Chaebol Group
| (As of December 31, 2018) | ||||
Group | Credit extended | |||
| (Unit: in billions of Won) | ||||
Hyundai Motor | 4,768 | |||
Samsung | 3,380 | |||
SK | 2,472 | |||
Lotte | 2,192 | |||
LG | 2,168 | |||
Hanwha | 1,696 | |||
GS | 1,073 | |||
CJ | 829 | |||
Shinsegae | 804 | |||
LS | 789 | |||
|
| |||
Total | 20,171 | |||
|
| |||
3.3.5. Kookmin Bank’s Loan Concentration by Industry
| (As of December 31, 2018) | ||||||||
Industry | Total Credit | Percentage of Total Credit | ||||||
| (Unit: in billions of Won, %) | ||||||||
Manufacturing | 44,102.8 | 33.20 | ||||||
Real estate | 28,385.9 | 21.37 | ||||||
Retail and wholesale | 18,148.3 | 13.66 | ||||||
Hotel, lodging and food service | 8,603.3 | 6.48 | ||||||
Financial institutions | 3,051.8 | 2.30 | ||||||
Construction | 2,987.4 | 2.25 | ||||||
Others | 27,553.6 | 20.74 | ||||||
|
|
|
| |||||
Total | 132,833.1 | 100.00 | ||||||
|
|
|
| |||||
3.3.6. Top 20Non-Performing Loans of Kookmin Bank
| (As of December 31, 2018) | ||||||||||
Borrower | Industry | Total Credit | Allowance for Loan Losses | |||||||
| (Unit: in billions of Won) | ||||||||||
Borrower A | Construction | 99.1 | 96.2 | |||||||
Borrower B | Construction | 66.9 | 67.5 | |||||||
Borrower C | Information and communication | 55.3 | 54.0 | |||||||
Borrower D | Manufacturing | 51.5 | 37.2 | |||||||
Borrower E | Construction | 40.6 | 39.7 | |||||||
Borrower F | Transportation and storage | 23.8 | 23.5 | |||||||
Borrower G | Real estate | 15.8 | 0.7 | |||||||
Borrower H | Construction | 15.8 | 14.9 | |||||||
Borrower I | Real estate | 13.9 | 0.7 | |||||||
Borrower J | Information and communication | 13.5 | 12.9 | |||||||
Borrower K | Manufacturing | 12.9 | 5.3 | |||||||
Borrower L | Retail and wholesale | 11.5 | 8.4 | |||||||
Borrower M | Manufacturing | 10.0 | 0.6 | |||||||
Borrower N | Manufacturing | 9.6 | 9.3 | |||||||
Borrower O | Real estate | 9.1 | 9.0 | |||||||
Borrower P | Retail and wholesale | 8.7 | 5.7 | |||||||
Borrower Q | Manufacturing | 8.1 | 5.0 | |||||||
Borrower R | Manufacturing | 7.9 | 3.9 | |||||||
Borrower S | Health and social services | 7.4 | 7.4 | |||||||
Borrower T | Real estate | 6.6 | 0.6 | |||||||
|
|
|
| |||||||
Total | 487.9 | 402.4 | ||||||||
|
|
|
| |||||||
| 3.4. | Other Financial Information |
See the Company’s Form6-K furnished to the Securities and Exchange Commission on March 12, 2019 (available on www.sec.gov), which contains the Company’s audited consolidated and separate financial statements as of and for the years ended December 31, 2018 and 2017 and related notes, which have been prepared in accordance withK-IFRS. The Company’s audited consolidated and separate financial statements are also available on its website,www.kbfg.com.
| 4. | Independent Public Accountants |
| 4.1. | Audit / Review Services |
Period | Auditor | Activity | Compensation(1) (in millions of Won) | Accrued Time (hours) | ||||||||
January 1 to December 31, 2018 | Samil PricewaterhouseCoopers | Quarterly / first half and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting) | 949 | 9,820 | ||||||||
January 1 to December 31, 2017 | Samil PricewaterhouseCoopers | Quarterly / first half and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting) | 856 | 11,080 | ||||||||
January 1 to December 31, 2016 | Samil PricewaterhouseCoopers | Quarterly / first half and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting) | 760 | 10,505 | ||||||||
| (1) | Excluding value-added taxes. |
| 4.2. | Public Company Accounting Oversight Board (“PCAOB”) Audit Services |
Period | Auditor | Activity | Service Period | Compensation(1) (in millions of Won) | ||||||
January 1 to December 31, 2018 | Samil PricewaterhouseCoopers | PCAOB audit of consolidated financial statements and internal control over financial reporting | May 1, 2018 to April 30, 2019 | 571 | ||||||
January 1 to December 31, 2017 | Samil PricewaterhouseCoopers | PCAOB audit of consolidated financial statements and internal control over financial reporting | May 1, 2017 to April 30, 2018 | 540 | ||||||
January 1 to December 31, 2016 | Samil PricewaterhouseCoopers | PCAOB audit of consolidated financial statements and internal control over financial reporting | May 1, 2016 to April 30, 2017 | 459 | ||||||
| (1) | Excluding value-added taxes. |
| 5. | Corporate Governance and Affiliated Companies |
| 5.1. | Board of Directors & Committees under the Board |
As of December 31, 2018, our board of directors consisted of nine directors, comprising one executive director, onenon-standing director and sevennon-executive directors. The following committees currently serve under our board of directors:
| • | Audit Committee; |
| • | Risk Management Committee; |
| • | Evaluation & Compensation Committee; |
| • | Non-Executive Director Nominating Committee; |
| • | Subsidiaries’ CEO Director Nominating Committee; |
| • | CEO Nominating Committee; and |
| • | Audit Committee Member Nominating 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 anas-needed basis.
| 5.3. | Compensation to Directors |
5.3.1. Total Amount Approved at the Meeting of Shareholders
| (Unit: in millions of Won) | ||||||||||||
| Total number of persons(1) | Total amount approved at shareholders’ meeting(2) | Notes | ||||||||||
Registered Directors | 9 (7) | 2,500 | — | |||||||||
| (1) | Represents the total number of applicable persons as of December 31, 2018. |
| (2) | Represents the aggregate amount for all directors (includingnon-executive directors). Excludes compensation in the form of long-term performance-based stock grants. |
5.3.2. Total Amount Paid
| (As of December 31, 2018) | (Unit: in millions of Won) | |||||
Total number of persons(1) | Total payment(2) | Average payment per person(3) | Notes | |||
9 | 2,061 | 229 | — |
| (1) | Represents the total number of applicable persons as of December 31, 2018. |
| (2) | Represents the total amount paid (rounded to the nearest million) for the year ended December 31, 2018. |
| (3) | Represents (i) the total amount paid (rounded to the nearest million) for the year ended December 31, 2018, divided by (ii) the annualized number of applicable persons for the applicable reporting period. |
*Suk Ho Sonu, Myung Hee Choi and Kouwhan Jeong were newly appointed asnon-executive directors on March 23, 2018.
*Young Hwi Choi, Michael Byungnam Lee and Eunice Kyonghee Kim retired from their posts asnon-executive directors on March 23, 2018.
5.3.3. Compensation Breakdown
| (As of December 31, 2018) | (Unit: in millions of Won) | |||||||||||||||
| Total number of persons(1) | Total payment (2)(4) | Average payment per person (3) | Notes | |||||||||||||
Registered Directors(excludingnon-executive directors and Audit Committee members) | 2 | 1,438 | 719 | — | ||||||||||||
Non-executive Directors (excluding Audit Committee members) | 3 | 264 | 88 | — | ||||||||||||
Audit Committee members | 4 | 358 | 90 | — | ||||||||||||
Internal Auditor | — | — | — | — | ||||||||||||
| (1) | Represents the total number of applicable persons as of December 31, 2018. |
| (2) | Represents the total amount paid (rounded to the nearest million) for the year ended December 31, 2018. |
| (3) | Represents (i) the total amount paid (rounded to the nearest million) for the year ended December 31, 2018, divided by (ii) the annualized number of applicable persons for the applicable reporting period. |
| (4) | Payment subject to the Company’s internal policies on compensation to directors. |
5.4. Top 5 Highest-Paid Individuals
5.4.1. Compensation exceeding Won 500 million – Individual basis
| (As of December 31, 2018) | (Unit: in millions of Won) | |||||
Name | Position | Total | Additional Compensation | |||
| Jong Kyoo Yoon | Chairman & CEO | 1,438 | Other than 12,018 shares granted (included in total compensation) in November 2018, 12,018 shares in November 2019 and 12,018 shares in November 2020 are expected to be granted as a long-term performance-based stock grant, pursuant to a performance evaluation over a three-year period from November 21, 2014 to November 20, 2017. The actual payment amount will be determined in the future based on the fair market price of our shares.
In addition to the above compensation, a maximum amount of 46,890 shares over three years (15,630 shares per year) are expected to be granted as a long-term performance-based stock grant. The actual share amount will be determined in the future based on a performance evaluation over a three-year period from November 21, 2017 to November 20, 2020. | |||
| Kyung Yup Cho | Senior Managing Director | 818 | 13,692 restricted stock units granted pursuant to a long- and short-term performance evaluation from 2013 to 2017. The actual payment amount will be determined in the future based on the fair market price of our shares. | |||
| Young Hyuk Jo | Senior Managing Director | 702 | 4,605 restricted stock units granted pursuant to a long- and short-term performance evaluation from 2016 to 2017. The actual payment amount will be determined in the future based on the fair market price of our shares. | |||
| Pil Kyu Im | Senior Managing Director | 665 | 6,561 restricted stock units granted pursuant to a long- and short-term performance evaluation from 2016 to 2017. The actual payment amount will be determined in the future based on the fair market price of our shares. | |||
5.4.2. Calculation criteria and method of compensation to Chairman & CEO
| (Unit: in millions of Won) | ||||||||
Name | Compensation | Classification | Total Compensation (in | Calculation Criteria and Method | ||||
| Jong Kyoo Yoon | Earned income | Salary | 800 | A monthly salary was paid, which was derived by dividing (i) the amount of annual salary determined by resolution of the Evaluation & Compensation Committee within the limit of the total amount of compensation approved at the shareholders’ meeting by (ii) 12 months. (This amount includes allowances for business expenses of Won 350 million.) | ||||
| Bonus | 638 | The bonus paid in 2018 was Won 638 million, of which (i) Won 51 million was paid in February 2018 based on performance from November 21, 2017 to December 31, 2017 after reappointment as Chairman and CEO in 2017 and (ii) Won 587 million was paid in November 2018 based on the first grant of 12,018 shares (out of a total of 36,054 shares to be granted), as determined in December 2017 pursuant to a performance evaluation over a three-year period from November 21, 2014 to November 20, 2017.
The short-term performance-based incentive payment based on performance from November 21, 2017 to December 31, 2017 was approved at the third meeting of the Evaluation & Compensation Committee held in 2018 based on the final performance evaluation and resolution by the Evaluation & Compensation Committee, in accordance with the “Proposal on Long- and Short-Term Performance Evaluation and Compensation Scheme for the CEO,” which was approved at the seventh meeting of the Evaluation & Compensation Committee held in 2017. | ||||||
| The short-term performance evaluation index for 2017 comprises financial results (e.g., ROE, RAROC, CIR, real NPL ratio, Tier 1 ratio) and results related to strategic initiatives (e.g., solidifying the position of the Company as the leading financial group through strengthening its core businesses and improving customer value through pursuing the“One-Firm KB” policy). The amount of the short-term incentive payment is determined based on the aggregate score of the index items above and is within the range of0%-100% of the base salary, taking into account the number of days in office (41 days) after reappointment as Chairman and CEO in 2017. | ||||||||
| With respect to financial results, the major achievements reflected in the performance evaluation included the attainment of key financial indicators that exceeded the target for that year, such as a 54.5% YoY increase in the Company’s net income to Won 3,311.4 billion in 2017, the enhancement of the Company’s business portfolio by successfully adding wholly-owned subsidiaries and the improvement of asset quality by decreasing potentialnon-performing loans. | ||||||||
| With respect tonon-financial results, the major achievements considered included solidifying the position of the Company as the leading financial group through strengthening market power by securing the competency and competitive edge of the subsidiaries’ core businesses, proactively adapting to changes in the fintech industry and promoting the adoption of digital systems within the Company, as well as establishing customer-centric sales channels and strengthening non-personal sales channels, which enhanced the overall customer experience. | ||||||||
| The long-term performance-based incentive payment of Won 587 million was paid based on the fair market price of Won 48,864 per share on November 20, 2018, with respect to the first grant of 12,018 shares (out of a total of 36,054 shares to be granted), as determined pursuant to a performance evaluation over a three-year period from November 14, 2014 to November 20, 2017. | ||||||||
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 December 31, 2018 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) KB Asset Management Co., Ltd. (100.00%)
6) KB Capital Co., Ltd. (100.00%)
7) KB Life Insurance Co., Ltd. (100.00%)
8) KB Real Estate Trust Co., Ltd. (100.00%)
9) KB Savings Bank Co., Ltd. (100.00%)
10) KB Investment Co., Ltd. (100.00%)
11) KB Data Systems Co., Ltd. (100.00%)
12) KB Credit Information Co., Ltd. (100.00%)
| 6. | Directors, Senior Management and Employees |
| 6.1. | Executive Directors |
As of March 31, 2019, 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 December 31, 2018 are set forth below.
Name | Date of Birth | Position | Common Shares Owned | End of Term | ||||||
Jong Kyoo Yoon | October 1955 | Chairman & Chief Executive Officer | 20,000 | November 20, 2020 | ||||||
| 6.2. | Non-standing Directors |
As of March 31, 2019, we had onenon-standing director. The name, position and the end of the term of ournon-standing director and the number of shares of our common stock he owned as of December 31, 2018 are set forth below.
Name | Date of Birth | Position | Common Shares Owned | End of Term | ||||||
Yin Hur | December 1961 | Non-standing Director | 2,000 | March 22, 2020 | ||||||
| 6.3. | Non-executive Directors |
As of March 31, 2019, we had sevennon-executive directors. The name, position and the end of the term of ournon-executive directors and the number of shares of our common stock they respectively owned as of December 31, 2018 were as follows.
Name | Date of Birth | Position | Common Shares Owned | End of Term | ||||||||
Suk Ryul Yoo | April 1950 | Non-executive Director | — | March 26, 2020 | ||||||||
Stuart B. Solomon | July 1949 | Non-executive Director | — | March 26, 2020 | ||||||||
Suk Ho Sonu | September 1951 | Non-executive Director | — | March 22, 2020 | ||||||||
Myung Hee Choi | February 1952 | Non-executive Director | — | March 22, 2020 | ||||||||
Kouwhan Jeong | September 1953 | Non-executive Director | — | March 22, 2020 | ||||||||
Kyung Ho Kim | December 1954 | Non-executive Director | — | March 26, 2021 | ||||||||
Jae Ha Park | November 1957 | Non-executive Director | — | March 26, 2020 | ||||||||
| 6.4. | Senior Management |
In addition to our executive director who is also our executive officer, we had the following executive officers as of March 31, 2019.
Name | Date of Birth | Position | Common Shares Owned* | End of Term | ||||||
Ki-Hwan Kim | March 1963 | Deputy President and Chief Finance Officer | 1,405 | December 31, 2019 | ||||||
Pil Kyu Im | March 1964 | Deputy President and Chief Human Resources Officer | 445 | December 31, 2019 | ||||||
Kyung Yup Cho | September 1961 | Deputy President; KB Research | 1,500 | December 31, 2019 | ||||||
Young Hyuk Jo | April 1963 | Deputy President; Audit Department | 461 | December 31, 2019 | ||||||
Chang Kwon Lee | November 1965 | Senior Managing Director and Chief Strategy Officer | 500 | December 31, 2019 | ||||||
Hyun Jin Shin | February 1965 | Senior Managing Director and Chief Risk Management Officer | — | December 31, 2019 | ||||||
Nam Hoon Cho | June 1968 | Managing Director and Chief Global Strategy Officer | — | December 31, 2019 | ||||||
Chan Il Park | March 1963 | Managing Director and Chief Compliance Officer | 351 | December 31, 2020 | ||||||
Soon Bum Kwon | October 1966 | Managing Director | 1,142 | December 31, 2019 | ||||||
Jeong Rim Park | November 1963 | Head of Capital Market Business Unit | 634 | December 31, 2019 | ||||||
Jong Hee Yang | June 1961 | Head of Insurance Business Unit | 914 | December 31, 2019 | ||||||
Dong Cheol Lee | October 1961 | Head of Retail Customer Business Unit | 1,010 | December 31, 2019 | ||||||
Bo Youl Oh | January 1962 | Head of Corporate and Investment Banking Business Unit | 463 | December 31, 2019 | ||||||
Young Gil Kim | January 1963 | Head of Wealth Management Business Unit | 60 | December 31, 2019 | ||||||
Deok Soon Shin | February 1963 | Head of Small and Medium Enterprise Business Unit | 1,155 | December 31, 2019 | ||||||
Chai Hyun Sung | September 1965 | Chief Public Relation Officer | 950 | December 31, 2019 | ||||||
Dong Whan Han | January 1965 | Chief Digital Innovation Officer and Chief Data Officer | 100 | December 31, 2019 | ||||||
Woo Yeul Lee | November 1964 | Chief Information Technology Officer | 555 | December 31, 2019 | ||||||
Jin Gyu Maeng | January 1966 | General Manager of Planning and Coordination Office | 71 | December 31, 2019 | ||||||
| * | Represents the number of common shares owned as of December 31, 2018. |
As of March 31, 2019, 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 | |||
Jeong Rim Park | KB Securities | Chief Executive Officer | January 2019 | |||
Jong Hee Yang | KB Insurance | Chief Executive Officer | March 2016 | |||
Dong Cheol Lee | KB Kookmin Card | Chief Executive Officer | January 2018 | |||
Bo Youl Oh | Kookmin Bank | Senior Executive Vice President; Corporate and Investment Banking Customer Group | January 2019 | |||
| KB Securities | Deputy President; Investment Banking Division | January 2018 | ||||
Chai Hyun Sung | Kookmin Bank | Senior Managing Director; Consumer Brand Strategy Group | January 2019 | |||
Dong Whan Han | Kookmin Bank | Senior Managing Director; Digital Business Group, Data Strategy Division | January 2019 | |||
| KB Kookmin Card | Senior Managing Director; Data Strategy Division | January 2019 | ||||
Woo Yeul Lee | Kookmin Bank | Senior Managing Director; Information Technology Group | January 2019 | |||
Young Gil Kim | Kookmin Bank | Senior Managing Director; Wealth Management Group | January 2019 | |||
| KB Securities | Deputy President; Wealth Management Division | January 2019 | ||||
Deok Soon Shin | Kookmin Bank | Senior Managing Director; Small and Medium Enterprise Group | January 2019 | |||
Jin Gyu Maeng | Kookmin Bank | General Manager; Planning and Coordination Office | January 2019 | |||
Ki-Hwan Kim | KB Insurance | Non-standing Director | February 2018 | |||
| KB Kookmin Card | Non-standing Director | February 2018 | ||||
Chang Kwon Lee | KB Securities | Non-standing Director | February 2018 |
As of December 31, 2018, the followingnon-executive directors also served as a director at another company.
Name | Company | Position | Appointment Date | |||
Suk Ryul Yoo | Jungmok | CEO | December 2013 | |||
Kouwhan Jeong | Nambujeil Law and Notary Office Inc. | President Attorney at Law | May 2016 |
| 6.5. | Employees |
The following table shows information regarding our employees as of December 31, 2018.
| (Unit: in millions of Won) | ||||||||||||||||
| Number of Employees(A)* | Average Tenure of Employees (months) | Total Amount of Annual Salaries(B) | Average Annual Salary per Person(B/A) | |||||||||||||
| 185 | 41 | 23,840 | 129 | |||||||||||||
|
|
|
|
|
|
|
| |||||||||
| * | Includes 15 executive officers. |
The following table shows information regarding executive officers as of December 31, 2018.
| (Unit: in millions of Won) | ||||||||
Number of Executive Officer(A) | Total Amount of Annual Salaries(B) | Average Annual Salary per Person(B/A) | ||||||
| 15 | 3,942 | 263 | ||||||
| 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 as of December 31, 2018.
| (Unit: shares, %) | ||||||||
Name | Number of Shares of Common Stock | Percentage of Total Issued Shares(1) | ||||||
Korean National Pension Service | 39,704,733 | 9.50 | ||||||
JP Morgan Chase Bank, N.A.(2) | 26,726,442 | 6.39 | ||||||
| (1) | Based on 418,111,537 shares of our common stock issued as of December 31, 2018. |
| (2) | Depositary under the Company’s ADR program. The voting rights are held by ADR holders. |
| 7.2. | Changes in the Largest Shareholder |
| (As of December 31, 2018) | (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 | Percentage of Total Issued Shares(1) | |||||||
Korean National Pension Service | December 31, 2011 | 26,510,171 | 6.86 | |||||||
Korean National Pension Service | March 14, 2012 | 27,894,880 | 7.22 | |||||||
Korean National Pension Service | August 1, 2012 | 31,817,770 | 8.24 | |||||||
Korean National Pension Service | December 31, 2012 | 33,158,257 | 8.58 | |||||||
Korean National Pension Service | June 12, 2013 | 34,479,641 | 8.92 | |||||||
Korean National Pension Service | July 23, 2013 | 35,699,841 | 9.24 | |||||||
Korean National Pension Service | December 31, 2013 | 38,476,974 | 9.96 | |||||||
Korean National Pension Service | October 14, 2014 | 36,750,987 | 9.51 | |||||||
Korean National Pension Service | December 31, 2014 | 36,383,211 | 9.42 | |||||||
Korean National Pension Service | December 31, 2015 | 35,534,667 | 9.20 | |||||||
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 | |||||||
| (1) | Based on 418,111,537 total issued shares of common stock for dates on or after October 19, 2016, and 386,351,693 total issued shares of common stock for dates prior to October 19, 2016. |
| 7.3. | Employee Stock Ownership Association |
| (As of December 31, 2018) | (Unit: shares) | |||
Company Name | Number of Shares of Common Stock Owned | |||
KB Financial Group Inc. | 11,775 | |||
Kookmin Bank | 2,231,470 | |||
KB Securities Co., Ltd. | 12,870 | |||
KB Insurance Co., Ltd. | 82,396 | |||
KB Kookmin Card Co., Ltd. | 119,792 | |||
KB Asset Management Co., Ltd. | 4,720 | |||
KB Capital Co., Ltd. | 1,033 | |||
KB Life Insurance Co., Ltd. | 8,093 | |||
KB Real Estate Trust Co., Ltd. | 3,445 | |||
KB Savings Bank Co., Ltd. | 1,975 | |||
KB Investment Co., Ltd. | 720 | |||
KB Data Systems Co., Ltd. | 6,740 | |||
KB Credit Information Co., Ltd. | 5,717 | |||
|
| |||
Total | 2,490,746 | |||
|
| |||
| 7.4. | Investments in Affiliated Companies |
| (As of December 31, 2018) | (Units: shares, %, millions of Won) | |||||||||||||||||||
Company Name | Ending Balance | Total Assets | Net Income (loss) | |||||||||||||||||
| Number of Shares Owned | Ownership | Book value | ||||||||||||||||||
Kookmin Bank | 404,379,116 | 100 | 14,821,721 | 356,959,258 | 2,259,198 | |||||||||||||||
KB Securities Co., Ltd. | 298,620,424 | 100 | 3,342,391 | 45,086,292 | 178,850 | |||||||||||||||
KB Insurance Co., Ltd. | 66,500,000 | 100 | 2,375,430 | 34,785,551 | 262,266 | |||||||||||||||
KB Kookmin Card Co., Ltd. | 92,000,000 | 100 | 1,953,175 | 20,528,951 | 286,598 | |||||||||||||||
KB Asset Management Co., Ltd. | 7,667,550 | 100 | 96,312 | 254,256 | 39,586 | |||||||||||||||
KB Capital Co., Ltd. | 21,492,128 | 100 | 573,811 | 9,517,239 | 111,939 | |||||||||||||||
KB Life Insurance Co., Ltd. | 91,200,000 | 100 | 485,314 | 9,680,379 | 14,824 | |||||||||||||||
KB Real Estate Trust Co., Ltd. | 16,000,000 | 100 | 121,553 | 293,063 | 47,004 | |||||||||||||||
KB Savings Bank Co., Ltd. | 8,001,912 | 100 | 157,544 | 1,388,844 | 11,018 | |||||||||||||||
KB Investment Co., Ltd. | 8,951,797 | 100 | 104,910 | 528,701 | 14,532 | |||||||||||||||
KB Data Systems Co., Ltd. | 800,000 | 100 | 6,334 | 40,197 | 2,942 | |||||||||||||||
KB Credit Information Co., Ltd. | 1,252,400 | 100 | 23,621 | 26,276 | 185 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | — | — | 24,062,116 | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
(1) Based onK-IFRS (on a consolidated basis).
| 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 | 5.011 | % | March 27, 2045 (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. 320 Private Placement of Capital Securities in Won | 50 | September 24, 2015 | 4.606 | % | September 24, 2045 (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. 343 Private Placement of Capital Securities in Won | 50 | March 29, 2016 | 4.396 | % | March 29, 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. 352 Private Placement of Capital Securities in Won | 50 | June 28, 2016 | 4.064 | % | June 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. 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 | ||||||||||
7.5.2. Prepayments and Loans to Subsidiaries
| (Unit: in billions of Won) | ||||||||||||||||
Name | Relationship | Account | Loan Amount | Current | Credit | Interest Rate | Maturity Date | |||||||||
KB Investment Co., Ltd. | Subsidiary | Loans(1) | 10 | 10 | July 14, 2017 | | 2.150 | %(2) | July 12, 2019 | |||||||
| (1) | Unsecured credit loans |
| (2) | Changed from 2.042% to 2.150% upon extension of the loans on July 13, 2018. |
| (Unit: in billions of Won) | ||||||||||||||||
Name | Relationship | Account | Loan Amount | Current | Credit | Interest Rate | Maturity Date | |||||||||
KB Investment Co., Ltd. | Subsidiary | Loans(1) | 40 | 40 | July 13, 2018 | 2.150 | % | July 12, 2019 | ||||||||
| (1) | Unsecured credit loans |
| (Unit: in billions of Won) | ||||||||||||||||
Name | Relationship | Account | Loan Amount | Current | Credit | Interest Rate | Maturity Date | |||||||||
KB Investment Co., Ltd. | Subsidiary | Loans(1) | 70 | 70 | March 8, 2019 | 2.176 | % | March 7, 2020 | ||||||||
| (1) | Unsecured credit loans |
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: April 1, 2019 | By: /s/Ki-Hwan Kim | |||||||
| (Signature) | ||||||||
| Name: | Ki-Hwan Kim | |||||||
| Title: | Deputy President and Chief Finance Officer | |||||||
