Fee income surges 38.5%, driving earnings growth

KB Securities tops 1 trillion won in profit; bank corporate loans also rise

KB Financial Group headquarters [KB Financial Group]
KB Financial Group headquarters [KB Financial Group]

KB Financial Group's cumulative net profit for the first three quarters of this year is approaching 5.8 trillion won ($4.34 billion), putting it on track to surpass last year's full-year result. The performance reflects steady growth in the bank's interest income alongside a sharp expansion in fee revenue, led by the securities unit.

KB Financial said Thursday its net profit for the first nine months of the year reached 5.79 trillion won, up 13.1% from the same period a year earlier. Compared with last year's full-year net profit of 5.83 trillion won, the group has already achieved 99% of that figure in just three quarters. The cumulative return on equity stood at 13.89%.

Fee income was the primary driver of earnings growth. Cumulative net fee income for the first three quarters came to 4.09 trillion won, up 38.5% from a year earlier, fueled by strong growth in securities brokerage commissions and bank fees tied to financial investment products, with the card and leasing segments also contributing. Quarterly net fee income reached 1.13 trillion won, surpassing 1 trillion won for the fourth consecutive quarter.

KB Securities posted a nine-month cumulative net profit of 1.07 trillion won, up 114.9% year on year, driven by higher stock market trading volumes and growth in customer assets that boosted brokerage and wealth management revenue. The non-banking segment's share of the group's total net profit reached 40%.

The banking segment also maintained its growth momentum on the back of expanded corporate lending. KB Kookmin Bank's cumulative net profit for the first three quarters rose 6.3% year on year to 3.58 trillion won. The group's cumulative net interest income grew 2.9% to 9.99 trillion won. However, the group's net interest margin for the third quarter edged down 0.02 percentage points from the previous quarter to 1.92%, while the bank's NIM fell by the same margin to 1.72%.

Net profit for the third quarter alone came to 1.91 trillion won, down 4.3% from the previous quarter. The figure incorporated a roughly 231 billion won reduction in income tax expenses stemming from the recognition of deferred tax assets in connection with the establishment of an intermediate holding company in Indonesia.

The common equity tier 1 ratio stood at 13.80% and the BIS capital adequacy ratio at 16.02% as of end-September. KB Financial's board also approved a third-quarter cash dividend of 1,167 won per share, totaling 404.9 billion won.

"Even amid persistent uncertainty in financial markets, KB Financial continues to deliver stable earnings growth by proactively responding to market changes, underpinned by balanced profit-generating capacity across both banking and non-banking segments," said Na Sang-rok, executive vice president and chief financial officer of KB Financial Group.

Meanwhile, the combined nine-month cumulative net profit of Shinhan, Hana and Woori Financial reached 10.72 trillion won this year.


rim@heraldcorp.com