Bulletin: KB Financial Group Can Absorb Costs Related To Equity-Linked Securities

HONG KONG (S&P Global Ratings) April 25, 2024--KB Financial Group Inc.'s (KBFG) earnings remain resilient. We believe the Korea-based group has earnings capacity to mitigate sizable compensation expenses related to the sale of equity-linked security (ELS) products. The group's diversified businesses across banking and nonbanking will also continue to be a strength. In its preliminary results announced today, KBFG (A/Stable/A-1) reported a net profit of Korean won (KRW) 1.05 trillion for the first quarter of 2024. This translates to an annualized return on average assets (ROAA) of about 0.58%, lower than 0.87% in the same quarter in 2023 (full year: 0.66%). The dip in profitability was mainly due to Kookmin Bank's (A+/Stable/A-1) material compensation expenses of KRW634 billion (after-tax) for

...April 25, 2024 HONG KONG (S&P Global Ratings) April 25, 2024--KB Financial Group Inc.'s (KBFG) earnings remain resilient. We believe the Korea-based group has earnings capacity to mitigate sizable compensation expenses related to the sale of equity-linked security (ELS) products. The group's diversified businesses across banking and nonbanking will also continue to be a strength. In its preliminary results announced today, KBFG (A/Stable/A-1) reported a net profit of Korean won (KRW) 1.05 trillion for the first quarter of 2024. This translates to an annualized return on average assets (ROAA) of about 0.58%, lower than 0.87% in the same quarter in 2023 (full year: 0.66%). The dip in profitability was mainly due to Kookmin Bank's (A+/Stable/A-1) material compensation expenses of KRW634 billion (after-tax) for ELS products tied to the Hang Seng China Enterprises Index. Kookmin Bank's annualized ROAA was about 0.29% in the first quarter of 2024 (2023 full year: 0.62%). Kookmin Bank, the core...

Bulletin