Smooth Sailing for KB Financial Group

Leading financial group posts 1.575 tln won in profit in H1 helped by Kookmin Bank's exceptional performance

KB Financial Group posted 1.575 trillion won in net profit in the first half of this year with the second quarter accounting for 817.4 billion won and Kookmin Bank, a major affiliate of the group, recording 1.6 trillion won in net profit in H1, the group said recently.
A substantial rise in net profit has been owed to an improvement in net interest margin (NIM) throughout the period and also the soundness of assets, boosting interest earnings as a result of the reductions in loss provisions, the group said.
Interest earnings during the period amounted to 3.416 trillion won, owing to increases in NIM, up 12.9 percent YoY. Fee earnings came to 997.3 billion won in the first half, up 15.2 percent YoY. The loss provision fell 55.5 percent YoY to 718.1 billion won due to the soundness of assets.
Overhead expenses rose very little thanks to efforts to reduce expenses, rising only 3.3 percent YoY at 1.803 trillion won, the group said.
To review the first half results by major affiliates, Kookmin Bank posted a net profit of 1.6 trillion won thanks to increases in NIM and reduced loss provisions with the net profit in the second quarter coming to 8.599 billion won. Overall NIM, except for Kookmin Card, averaged 2.4 percent in the second quarter, up 0.02 percent from Q1, while combined NIM for both the bank and credit card amounted to 3.07 percent in Q2, up 0.01 percent from Q1.
Kookmin Bank's BIS came to 13.33 percent in H1, while core tier 1 ratio came to 10.2 percent, tops in the banking industry at home.
The ratio of non-performing assets came to 1.1 percent in Q1, up 0.02 percent from the preceding quarter and up 0.10 percent from yearend 2010, the group said.
Dr. Euh Yoon-dae was elected as Chairman & CEO of the Group in July 2010 in recognition of his extensive experience and track record in a wide spectrum of the financial industry, corporate sector, government bodies and academic sphere.
Previously, Dr. Euh was Chairman of the Presidential Council on Nation Branding and successfully enhanced Korea's national standing through the systematic and strategic collaboration of the government, private companies and the general public since 2009. He also served as chairman of the Steering Committee of Korea Investment Corporation (KIC) for two years from 2008.
Prior to his role at the KIC in 2008, Dr. Euh led various government bodies since 2005. He was co-chairman of the Committee on Domestic Measures for the FTA with the United States, co-chairman of the Committee for Future & Vision at the Ministry of Information & Communication and vice-chair of the National Economic Advisory Council, among others.
From 2003, Dr. Euh served as president of Korea University for four years and his leadership has been highly recognized since.
He founded the Korea Center for International Finance in 1999 and after two years as the first president, he joined the Public Fund Oversight Commission in 2001 as a Ministerial Member and played a key role until 2003.
His meaningful footsteps in the financial world started as a member of the Monetary Board of the Bank of Korea (BOK) in 1992. After three years at the BOK, he assumed board member roles at the Korea Development Bank from 1996 to 1997 and at Korea First Bank from 1998 to 1999. He is an internationally recognized authority on the Korean economy and financial industry.
Meanwhile, he also served as a board member of Hyundai Corporation and CJ Home Shopping.
Dr. Euh received a B.A. in Business Administration and an M.B.A. from Korea University, a Master of Business Management from the Asian Institute of Management and a Ph.D. in Business Administration from the University of Michigan at Ann Arbor.
Dr. Euh also holds a number of Honorary Doctoral Degrees from world-renowned universities including Renmin University, Griffith University, Waseda University and Yonsei University as well as an Honorary Fellowship of College from Royal Holloway, University of London.
As a highly respected scholar, Dr. Euh published a number of books, articles and academic research papers on finance, economics and management.
KB Financial Group won a number of awards in recognition for its efforts for change and reform in the past year. The leading financial group in Korea won the 2011 Transparent Management Award from the Korea Accountant Society and the Grand Award for the Excellent Corporate Structure 2011 from the Korea Corporate Management Structure Institute under the Korea Exchange.
In addition, the group was named the Top Bank for Korean Trade Finance and won the 2011 Grand Award for the Most Beloved Brand in Korea from a number of brand evaluation institutions and also named Most Ethical Enterprise for 2011.
Since July 2011, the financial group focused on boosting the management effect and stable group structure with the arrival of Chairman Euh Yoon-dae and pushed it with the launch of a special task force as part of the group's 58 objectives in connection with reform in personnel and improvement in business areas assigned to branches. nw

Chairman Euh Yoon-dae of KB Financial Group.

Photo on Courtesy of KB