...October 12, 2022 HONG KONG (S&P Global Ratings) Oct. 12, 2022--A delayed recovery of Kookmin Bank's Indonesian subsidiary will continue to weigh on the bank's overall asset quality, which will remain relatively weaker than the domestic commercial bank peer average. Kookmin's consolidated nonperforming asset (NPA) ratio was about 0.8% as of end-June 2022, compared with the peer average of about 0.4%. PT Bank KB Bukopin Tbk (Bukopin) has significant NPAs on its book and has made heavy losses steadily over the past few years due to economic strains in Indonesia amid the COVID-19 pandemic. Bukopin reported a regulatory nonperforming loan ratio of about 9.9% as of end-June 2022, but we estimate that its weak loans (including restructured loans) are much higher, given regulatory forbearance in Indonesia. Bukopin's size is small relative to Kookmin (A+/Stable/A-1) at about 1% of consolidated assets as of end-June 2022. Kookmin has a weaker track record in overseas business expansion than commercial...
