KB Financial Group reports record net profit in 2022

KB Financial Group Chairman Yoon Jong-kyoo speaks at a corporate event in Gwnagjin District, eastern Seoul, in July. [YONHAP]

KB Financial Group reported a record net profit last year as interest income grew, but fell short of the consensus.

The company reported 4.41 trillion won ($3.51 billion) in consolidated net profit in 2022, according to its preliminary earnings report Tuesday. The figure was up 0.09 percent on year, and fell short of the 4.75 trillion won consensus from FnGuide.

Its net profit in the fourth quarter was 385.4 billion won, down 39.51 percent on year.

Preemptively reserving provisions for employees’ voluntary retirement and a conservative outlook on the future economy contributed to the decline.

KB Financial Group did not disclose the total number of people that took voluntary retirement last year, but more than 600 people took the voluntary retirement at KB Kookmin Bank in 2022, according to local media reports.

KB Financial Group’s net interest income last year was a record high at 11.38 trillion won, up 18.9 percent on year. It led the group’s earnings, said KB.

The annual net interest margin for the group was 1.96 percent, up 13 basis points from a year earlier, and 1.73 percent at the bank, up 15 basis points.

“Interest profit increased largely from improved net interest margin due to the rise of market interest rate in the business environment where uncertainties and difficulties persisted in the economy and the financial market in 2022,” said the company in a statement on Tuesday.

KB Financial Group’s assets under management were 1,158.7 trillion won at the end of last year.

KB Kookmin Bank reported 2.996 trillion won in net profit last year, up 15.6 percent on year.

Total won lending was 329 trillion at the end of last year, up 3.1 percent from a year earlier. Household loans fell 2.4 percent primarily centered on unsecured loans due to the rise of interest rate. But corporate loans jumped 9.4 percent in the same period.

Net profit at KB Securities was 206.3-billion-won last year, down 65.3 percent on year.

Volatility in the financial market, which caused a slump in stock trading, reduced commissions.

A total of 3,914 trillion won was transacted on Korea’s stock market last year, down 42 percent on year, according to the Korea Exchange.

KB Insurance reported 557.7 billion won in net profit last year, up 84.8 percent on year. KB Kookmin Card’s net profit was 378.6 billion won, down 9.6 percent in the same period. Despite a recovery in spending, the interest rate for procuring funds rose, it said.

Shinhan Financial Group and Woori Financial Group are scheduled to report their earnings on Wednesday, followed by Hana Financial Group on Thursday.

The four financial holding firms — KB, Shinhan, Hana, Woori — are projected to report a record high net profit above 16 trillion won combined for last year earnings.

BY JIN MIN-JI [jin.minji@joongang.co.kr]