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KB Financial Group Posts 2.14 Trillion Won Net Profit in 2016

By February 9, 2017 at 6:02 am
Seoul-based KB Financial Group Inc. posts 2.14 trillion won net profit in 2016.

KB Financial Group Inc. posted 2.14 trillion won in net profit last year primarily due to improved profitability, the Seoul-based banking giant said on Thursday. 

The financial holding company reached the 2 trillion won net profit mark for the first time in five years. Compared to its full-year profit of 2 trillion won in 2015, last year's figure was up by 26.2 percent.

Higher interest income as well as declining costs and loan-loss provisions helped earnings growth last year, KB said. Interest profit rose to 6.42 trillion won last year, up by 3.2 percent on-year. Commission profit came to 1.58 trillion won, a gain of 3.3 percent from the previous year's January to December period.

Loan-loss reserves, used by banks to cover estimated losses due to non-performing loans, fell to 581.2 billion won, a huge 47.7 percent drop. 

In a regulatory filing in October, the company posted a net profit of 564.4 billion in the quarter ending Sept. 30, up from 414.5 billion in the same period in 2015.

During the same quarter, general costs stood at 995 billion won in the third quarter, while the group set aside 538.5 billion won for loan-loss reserves.  

Meanwhile, KB Kookmin Bank, group's flagship company, saw its full-year net profit fall by 12.9 percent from the previous year to 964.3 billion won. The company cited higher costs in "honorary retirement" for some of its employees for the decline.   

In the third quarter, Kookmin Bank saw an 80.6 percent rise in net profit. The group's top subsidiary posted a net profit of 421.8 billion won during the July to September quarter.  

KB said its net interest margin, a key measure of profitability, rose to 581.2 billion won for the full year, a gain of 0.04 percent from 2015. It rose 1.85 percent in the third quarter compared to the same period a year ago.

The group's total assets by the end of the third quarter last year stood at 351.8 trillion, an increase of 8.4 percent from the previous year. 

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