管理層發言
Greetings, everyone. I am Jerry Kang, Head of KBFG IR Department. We will now begin the 2026 First Half Business Results Presentation. Thank you very much for participating in today's earnings release. We have here with us today for the business results presentation our Group CFO, Sang-Rok Na, as well as executives from our group. Regarding the agenda today, we will first have our Group CFO deliver the 2026 first half business results and then have a Q&A session. We will now have our Group CFO deliver a presentation on 2026 first half business results.
Greetings, everyone. I am KBFG CFO, Sang-Rok Na. Thank you very much for taking part in the 2026 first half earnings release. Before we proceed with the business results presentation, I would first like to cover the first half shareholder return approved at today's Board of Directors meeting. Let's go to Page 1. Despite the operating environment in the first half of the year marked by a high FX rate and heightened financial market volatility, through strategic capital management efforts, June-end group CET1 ratio posted 13.74%, a 10 basis-point improvement compared to the previous quarter end. According to KB's shareholder return framework, capital that exceeds a 13.5% CET1 ratio will be utilized for our second round of shareholder return in 2026. At today's Board meeting, it was decided to carry out, firstly, KRW 700 billion of share buyback and cancellation. Regarding the remaining surplus capital, we will comprehensively take into account our earnings, PBR and dividend yield trends at the end of fiscal year 2026 and use this to fund additional shareholder returns. For your reference, if we take into account the KRW 2.820 trillion of the 2026 first round of shareholder returns, which was announced in February, we expect to post KRW 3.7 trillion as our 2026 annual total shareholder return. We will deliver on our commitment to the market to maintain industry-leading levels across all shareholder return metrics. Going forward, we plan to consistently maintain our differentiated shareholder return policy based on our stable earnings generation capacity. In addition, at today's Board meeting, a cash dividend of KRW 1,155 per share for Q2 was approved. Let's go to Page 2. Through strategic reallocation of capital, reflecting the operating environment and growth prospects of each business segment, we are continuously strengthening a virtuous cycle that enhances capital efficiency across the group and, at the same time, reinvesting in subsidiaries with strong growth potential. As part of these efforts, in order to absorb the full amount of capital moving into our recurring earnings base, we decided on two rounds of paid-in capital increases totaling KRW 1.7 trillion. This represents a more efficient and dynamic allocation of capital across the group, whereby capital generated by core subsidiaries, including the bank, is reinvested in the securities business, which offers strong growth potential. Our securities subsidiary plans to utilize the capital secured to proactively respond to changes in the wealth management market while providing venture capital and supporting productive finance by expanding its promissory note business and fulfilling the requirements ahead of time for IMA authorization. Going forward, we will further strengthen our group's medium- to long-term earnings base across businesses with strong growth potential and high capital efficiency, including the Capital Markets segment. Next, I will cover business results. Q2 net profit posted KRW 1,992.2 billion. On a first half cumulative basis, net profit posted KRW 3,884.6 billion, a 13.1% increase year-on-year. This was driven by a significant increase in fee income, which pushed the group's first half total operating income above KRW 10 trillion for the first time in its history and sustained its stable growth momentum. In particular, our securities subsidiaries' contribution to the group's net income for the first half increased to approximately a 21% level, leading the growth in earnings from our nonbanking business. Meanwhile, supported by this enhanced earnings capacity, the group's ROE for the first half also posted 14.09%, continuing its improvement trend. For your reference, first half nonoperating profit declined significantly year-on-year. This was mainly attributable to a high base effect from the additional provisioning for ELS-related liabilities in the previous quarter and gains on the disposal of assets held by consolidated funds in the prior year. Let me now walk you through our financial results in greater detail by business segment. For the first half of 2026, the group's NII recorded KRW 6.473 trillion, a slight increase year-on-year. However, it was a slight decrease quarter-on-quarter due to a slight drop in NIM from preemptive funding in anticipation of an interest rate hike in the second half of the year. Next is growth of loans in Korean won. As of the end of June 2026, bank loans in won amount to KRW 385 trillion, up 2% over the end of 2025 and up 1.6% quarter-on-quarter. Household loans shifted back to a solid growth trend, reaching KRW 184 trillion, while corporate loans recorded KRW 201 trillion, growing 2.2% quarter-on-quarter, mostly thanks to the growth of productive financing. In the second half of the year, while not compromising asset quality, we plan to pursue our growth strategy with a focus on qualitative growth such as portfolio shifts through productive financing. Next, net interest margins on the bottom right. Bank NIM for Q2 recorded 1.74%. Due to intensifying competition in corporate loans, yield on assets remained similar quarter-on-quarter. The increase in marketable deposits along with preemptive funding in preparation for the second half of the year market rate hike pushed up cost of funds, resulting in a NIM drop of 3 basis points quarter-on-quarter. Meanwhile, group NIM recorded 1.94% due to the impact of the lower bank NIM, combined with the decline in credit card financial assets and preemptive funding by KB Capital; group NIM is down 5 basis points quarter-on-quarter. However, in the second half of the year, with base rate hikes, asset and liability repricing effects and normalization of funding structures gradually incorporated, we expect NIMs to show an improving trend. Accordingly, on an annual basis, aligned with our forecast from the beginning of the year, we expect an improvement year-on-year. Next, noninterest income. Group noninterest income for the first half of the year recorded KRW 3.6292 trillion, demonstrating a significant improvement of 33.3% year-on-year. In particular, cumulative net fee income for the first half reached approximately KRW 3 trillion and in Q2 rose 17.8% quarter-on-quarter to KRW 1.6019 trillion, continuing a double-digit growth trend for three consecutive quarters. This was mainly driven by an expansion in securities brokerage fees under favorable stock market conditions alongside sales of capital market-linked products such as equity funds and ETFs by the bank as well as an increase in personal credit card spending. As a result, net fee and commission income contributed more than 31% to our top line for the first time, driving the group's solid performance. Meanwhile, as for the first half of the year's other operating income, mainly due to a decline in insurance income caused by rising loss ratios in long-term and auto insurance, results were somewhat sluggish compared to the same period last year. However, in Q2, loss ratios showed improvement and with the addition of CSM impairment reversals, insurance operating income increased. Promising industries such as AI and semiconductors led to significant valuation gains on unlisted stocks at our investment subsidiary, resulting in a performance that rose 29.1% quarter-on-quarter. Next, moving on to general and administrative (G&A) expenses. First-half G&A expenses increased 8.9% year-on-year, but backed by solid growth in total operating income, the group CIR posted 36.2%. Excluding Q4, when one-off expenses such as ERP typically occur, the group has stably managed its CIR in the mid- to upper-30% range every quarter since 2023. Going forward, while actively expanding investments for future growth, we will strengthen earnings capacity and also efficiently manage recurring expenses to maintain a downward stabilizing trend in group CIR. Next, on Page 8 is the group provision for credit losses. Q2 credit loss provisions recorded due to one-off provisioning related to nonperforming corporate loans at the bank amounted to KRW 519.8 billion, a slight increase quarter-on-quarter. Excluding these one-off factors, the group's overall asset quality continues to show an improving trend. Particularly, KB Card's asset quality is stabilizing, primarily in personal cards and card loans, easing provision burdens, while the savings bank subsidiary is also seeing real estate PF-related risks gradually resolving. As a result, Q2 group credit cost recorded 38 basis points, falling quarter-on-quarter. On a cumulative basis for the first half, it came in at 39 basis points, significantly improving by 15 basis points year-on-year. Lastly, moving on to group capital ratios. As of the end of June, preliminary estimates suggest a group BIS ratio of 15.91% and a CET1 ratio of 13.74%. Risk-weighted assets (RWA) recorded approximately KRW 370 trillion, up 1.1% quarter-on-quarter, but remain well within our projected RWA annual growth target. To consistently deliver on our shareholder return commitment, we will maintain a balanced pace of asset growth while driving capital efficiency and profitability through RoRWA-oriented asset rebalancing. Detailed breakdowns of our financial results are provided in the following slides for your reference. This concludes KB Financial Group's first half 2026 earnings presentation. Thank you for your time.
分析師問答
We have the first question. From Goldman Sachs, we have Park Sinyoung.
I am Park Sinyoung from Goldman. Regarding your total shareholder return for the first half for cash and for own shares, can you tell us the distribution also given that price-to-book multiple for KB has gone beyond 1 multiple? Can you tell us about how you're going to grow your cash dividend? Regarding the reduction in capital that was discussed at the GSM, can you tell us more details? Also, I think according to FX fluctuations there is some change in the capital ratio. Do you have any plans to revise the capital ratio? Regarding your target ROE level compared to your competitors, do you have plans to share them with us?
I will answer the questions, and thank you very much, Sinyoung Park, for your great questions. As you just mentioned, our CET1 ratio excess capital that exceeds 13.5% before the close of the fiscal year, we plan to return all of it to our shareholders. That remains our stance. We executed a share buyback and cancellation of KRW 700 billion, and we have about KRW 180 billion remaining. We believe there could be two scenarios considering flexibility. In the first case, year-end CET1 ratio and capital ratio management is very important. Looking at quarterly capital ratio trends from last year to this year, Q4 had seasonal effects, which made it challenging to uplift the CET1 ratio. Good capital management for Q3 is important. Our earnings capacity has strengthened, which has positive effects, but macro variables like the FX rate are uncertain. Therefore, we need to be flexible in timing. Regarding PBR reaching 1 multiple, we may consider adjusting the mix between cash dividends and share buyback/cancellation, but we are not planning radical changes. Cash dividend decisions will depend on earnings size, among other factors, so method and timing will be handled flexibly. Regarding shareholder return linked to our capital ratio, we are considering the best method. Until next year we have already disclosed our plan. The formula for shareholder return related to our capital ratio will not be greatly affected. If we are in an era where ROE strengthens, we will need to consider other methods as well. There is room for improvement, but we don't have anything concrete to share today. That is what I can share with you today. Thank you very much for your questions.
We would like to take the next question. Next question is from Securities Research.
I have two questions. First of all, recently there was a large fluctuation in margins. To look at this in more detail, I would like to hear a breakdown of the factors that impacted the margins, and what is your forecast for the second half margin? Second, regarding the ELS provisioning, could you provide more detail on that reversal of ELS?
First of all, about the NIMs. In Q2 NIM went down 3 basis points to 1.73% and year-on-year based on the half year, it went up 2 basis points. In terms of operation and funding, we can look at this from two perspectives. On the operational side, we are focusing on increasing productive finance, targeting stronger loans, and pursuing more conservative loan management. That led to a reduction in new spreads, reflecting our focus on strong customers and enhancing asset quality while growing larger customer relationships. In terms of funding, our KRW 5.8 trillion increase in liquidity has helped improve funding capacity. We did lose a portion of time deposits because of money movement, and MMDA and marketable deposits are areas where we have focused on preemptive funding to address that change; that increased funding costs, which will ease over time. For the NIM forecast, compared to other banks, we have a higher share of 12-month rolling repricing loans, which supports recurring income. In Q1 we were aggressive on pricing to win strong customers; in the latter half of the year our corporate loan review and approval will be a bit more conservative. We will also enhance portfolio diversity by targeting smaller customers to improve profitability. On liquidity, we will be flexible in funding mix—wealth management, core deposits and payroll accounts are areas of emphasis, and we will pursue more personal time deposits. Ultimately, our annual NIM outlook is for a slight increase versus 2025, as we announced at the start of the year. Regarding ELS provisioning, there may be a decision at the end of July by the Financial Supervisory Service and Financial Services Commission; that decision was not built into this report. We will incorporate any required adjustments or reversals going forward as appropriate.
We will take the next question. From Hanwha Securities, we have Do Ha Kim on the line.
I have two questions. My first question is about shareholder return. You mentioned KRW 700 billion of share buyback and cancellation, and you mentioned that you are thinking about increasing the dividend for the fiscal year-end. Looking at the current level, for Q3 there is the remaining shareholder return that you have to give, and it seems that you had done much already because there's only KRW 700 billion left. You mentioned that you might give out more in February of next year, but that would not completely adhere to prior messaging because utilizing it for dividends may come from the securities subsidiary as insurance subsidiaries cannot always do so. The market may be confused about the funding schedule. Can you explain the situation so we can better predict future funding flow? Secondly, related to loans, you mentioned corporate loan competition had a sobering effect. Can you tell us about any plans for loans by borrower type? That would be very helpful.
Thank you very much, Do Ha Kim, for your insightful questions. Regarding our funding schedule, it's not tangled. We have KRW 180 billion remaining, but that is not a wrench in our process. From next year, there will be capital reduction dividends and we have sufficient profits to distribute dividends. Regarding capital reduction dividends that we may issue from next year, that includes dividends from our life insurance subsidiary where applicable; the insurance subsidiaries can distribute dividends and it is not difficult for them to do so. Regarding hybrid bond issuance and other funding, we have ample room. You do not need to be overly concerned; please be reassured that our shareholder return will be executed as planned.
We will take the next question from HSBC, Mr. Won Jaewoong.
Thank you for the very strong performance in spite of the unfavorable environment. I'd like to ask about the nonbanking business. In the securities company, you recently had capital injection, so you're expanding existing businesses and trying to begin the IMA business as well. Compared to NH Investment Securities and Hankook SG, KB is much bigger. Regarding IMA, there might be conflicts of interest among customers. What are your thoughts on that? If you begin the IMA business, how much profit will be generated and how much will your balance grow? What are your projections? Second, leverage trust products are being sold recently through bank trust and a lot of sales were made, which contributed to noninterest fee income. How much does bank trust leverage take up, what is the balance, and how much is it contributing?
Thank you for the very good question. Regarding IMA, if you are able to fulfill the KRW 8 trillion capital requirement, it won't go into full-fledged business immediately; the capital actually needs to be maintained for two years. Our goal is not to expand IMA business right away but to gradually prepare for that area. About conflict of interest with the bank business, we do not expect conflicts of interest; rather, we expect synergies across the securities and bank subsidiaries. Many deals involve both securities and bank roles—senior loans and subordinated loans, for example—and roles are sometimes split between the two subsidiaries. We believe this will create synergistic effects rather than conflicts. Regarding leveraged ETF trust product, our CRO will answer that question.
Regarding the leveraged ETF trust product: at KB, we do not sell leveraged ETF products. That probably refers to activities at other companies. We are not selling that product. For customer asset risk management, we are not offering that product. Regarding household and corporate loan growth projections for the latter half of the year: household loans quarter-on-quarter growth was KRW 1.7 trillion, a 0.9% increase quarter-on-quarter and 0.5% year-on-year. Because of taxation on capital gains for owners of multiple homes, we have been focusing on other areas for growth. There is a ceiling on total home loans, so in terms of profitability, we will grow within our plans and focus on policy loans. For corporate loans, our balance is a little over KRW 200 trillion, which is 0.2% quarter-on-quarter growth or KRW 4.3 trillion growth. Because of our productive finance policy, we will continue this trend in the latter half of the year. We are focusing on corporates and shifting toward SMEs rather than SOHOs. Household loan profitability management and asset quality management require selectivity. Our household loan growth target remains 1% to 2% as in the past. For corporate loans, we will continue productive financing and the transition to SMEs is already taking place; the portfolio will be diversified for better growth prospects, focusing on SMEs and conglomerates. Corporate loan growth will be around 6% to 7% throughout the year, as we stated at the beginning of the year. Thank you.
From JPMorgan, we have Cho Jihyun.
Regarding shareholder return, I'm a bit confused and would like clarification. I know there is KRW 180 billion remaining in the second half. If it needs to be counted toward 2026 shareholder return resources, that affects whether share buyback and cancellation or cash dividends are distributed. Regarding this KRW 180 billion, how will it be handled? You mentioned the share buyback and cancellation is to be completed in mid-December. If executed earlier, does it mean share buyback will be possible within this year? Second, G&A has grown noticeably—can you explain the reason behind that? Third, Q2 had high capital market volatility—what is your outlook for fee income in the second half? Will this peak and then decline, or do you expect it to be sustained? Finally, about Q2 provisioning management: you did well in Q2. Can you tell us about second-half and full-year provisioning outlook or target?
Thank you very much for your insightful questions. Regarding shareholder return: as you suggested, we have choices in terms of method. We will choose one of the methods to enact additional shareholder return. We do have a trust contract, but early execution of share buyback is possible; historically some restrictions applied, but now it's more flexible. Because we have reached a PBR of 1 multiple, we could adjust toward cash dividends, and that could be included in our fiscal year-end dividend. Regarding the rise in G&A, this is largely due to very strong profits at the securities subsidiary, which increased compensation costs for employees; stock-related compensation costs also rose due to the stock market boom. Additionally, changes in education tax and corporate tax affected G&A—if we exclude the education tax effect, G&A increased about 3.5% year-on-year, a level we can manage. On capital markets and fee outlook: securities market volatility is high, so providing a precise outlook is limited. However, transaction volumes have increased compared to the past, so fee income will likely be elevated compared to the previous year and remain at that level. Even if some areas soften, we have some large CIB deals planned for the second half which could supplement capital markets fees. While ECM and DCM were sluggish in the first half, we have planned transactions in the second half that could support fee income. I'll ask our CRO to address provisioning.
Regarding provisioning: Q2 CCR was 39 basis points, improving quarter-on-quarter. Historically we maintained a conservative provisioning policy and secured coverage for potential losses. With higher-quality portfolio management, provisioning has normalized. However, given ongoing external risks—Middle East developments, high FX rates and interest rate volatility—sectors such as SMEs, SOHOs, marginal borrowers and vulnerable borrowers could experience stress. Therefore, in the second half we will maintain a conservative provisioning stance. There could be fluctuations, but for this year we expect provisioning to be in the early- to mid-40 basis points level.
We don't have any people waiting to ask questions. We will wait for people to line up their questions. From Samsung Securities, Kim Jaewoo.
I have one question. ROE has gone up quite significantly. What is the target ROE figure for the group? Competitors by 2027 were looking at 10% but adjusted to 12%–15%. For KBFG, do you have any guidance on how high your ROE will go? In connection with that, the securities subsidiary performance was quite strong and this was probably very helpful. However, the market's concern is that high volatility makes it harder to maintain performance at this higher level. Could KB Securities please respond to this question?
Thank you for that very good question. In terms of ROE, our prediction for this year is that the group's ROE will probably exceed 11% and we are optimistic about that. In the mid- to long-term, our target for ROE is around 13%, and we expect to reach that target, perhaps higher than initially expected. The recent ROE increase was largely driven by the securities subsidiary's strong performance. Given market volatility, that performance could fluctuate. However, structural expansion in stock market transactions supports sustaining higher fees. KB Securities is preparing to weather volatility—IB performance and earnings have become more visible and are recovering, especially in sales and trading where we had lagged competitors. We saw improvement in the first half and aim to maintain that in the second half. We are diversifying the portfolio, expanding venture capital and playing a larger role not just in retail but in large deals and overseas capital transactions. We are expanding our client base and diversifying revenues to better withstand volatility and maintain a stronger earnings base, and ultimately improve ROE further.
I'd like to add to that. The KB Securities CFO answered sufficiently, but I'd like to mention digital platform advancement. Our mobile trading system, M-able, offers integrated views for ETFs and domestic securities in one shot. We will enhance services in the latter half of the year and further advance MTS to make it more competitive.
It's already 4:43. So I think this will be the last question from Investment Securities.
I have one quick question. You mentioned the group ROE exceeding 11% this year and a mid- to long-term target of 13%. When do you expect to reach the target ROE? Also, can you tell us about the COE level that you have determined?
Thank you for your insightful questions. These are challenging questions. We have stated our mid- to long-term ROE goal for the group, but it's not easy to provide exact timelines for each subsidiary. For the bank, we target exceeding 11% ROE. For securities subsidiaries, we target around 14% ROE. For insurance, we expect 13% to 14% to be maintained. For card, given recent operational challenges, ROE has fallen, but we aim to raise it toward about 10%. Regarding COE, with a PBR at roughly 1 multiple, if ROE around 10% is achieved then COE around 10% is a reasonable reference. If PBR goes beyond 1 multiple, COE could be lower than 10%, but this is a prudent estimate.
There are no more people to ask questions. This brings us to the end of our earnings release. Those questions that were not asked during this session, please address them to the IR team. This brings us to the end of the 1H 2026 KBFG earnings release. Thank you.