Corporate Logo(source: kbgf.com)
On April 25, Daishin Securities maintained its “Buy” rating and target price of 112,000 KRW on KB Financial Group (105560), citing robust first-quarter earnings and an improved Common Equity Tier 1 (CET1) ratio, which it said would heighten expectations for shareholder returns in the second half of the year. The stock closed at 84,600 KRW in the previous session.
According to analyst Park Hye-jin of Daishin Securities, “KB Financial reported consolidated net profit of 1.7 trillion KRW in Q1 2025, up 62.9% year-on-year, exceeding both our estimate and the market consensus by 7%.”
The bank’s net interest margin (NIM) rose 4 basis points (bp) quarter-on-quarter, while Korean won-denominated loans grew 0.9%, resulting in net interest income of 3.26 trillion KRW, up 3.5% year-on-year. Despite a decline in loan interest rates, the easing of funding costs from repricing high-interest time deposits helped the group maintain stable margins, Park noted.
Non-interest income also rose 2.5% year-on-year to 1.3 trillion KRW. Gains in equity-related assets driven by lower interest rates contributed to a sharp rise in other operating income, while securities, credit card, and non-life insurance segments also delivered solid performance.
However, credit costs came in at 656 billion KRW, higher than expected, mainly due to one-off provisions: 67.5 billion KRW related to Homeplus and 41 billion KRW in additional provisioning tied to declining recovery rates on overseas commercial real estate collateral.
KB Financial’s CET1 ratio rose to 13.67% in Q1, strengthening the outlook for shareholder returns in the second half of the year. “While CET1 stood at 13.53% in Q4 2024, the company still announced a 300 billion KRW share buyback and a quarterly dividend per share (DPS) of 912 KRW, exceeding market expectations,” Park said.
She added, “Concerns over a decline in shareholder returns following the sharp drop in CET1 in Q4 led to a share price decline, but from a full-year profit perspective, total shareholder return will inevitably increase.”
“This announcement helps dispel earlier concerns and represents a significant step in shareholder return policy,” she noted. “While momentum in bank stocks has stalled following the revaluation phase, this move could serve as a catalyst to reinvigorate investor interest.”
*[KOSPI]KB Financial Group(105560) is the holding company of KB Financial Group, established in 2008. Leveraging its leading market position and strong brand recognition, it engages in various businesses including banking, cards, securities, life insurance, non-life insurance, and savings banks. Market capitalization is 33.27 trillion won(as of April 24, 2025, closing price).
Corporate Logo(source: kbgf.com)
On April 25, Daishin Securities maintained its “Buy” rating and target price of 112,000 KRW on KB Financial Group (105560), citing robust first-quarter earnings and an improved Common Equity Tier 1 (CET1) ratio, which it said would heighten expectations for shareholder returns in the second half of the year. The stock closed at 84,600 KRW in the previous session.
According to analyst Park Hye-jin of Daishin Securities, “KB Financial reported consolidated net profit of 1.7 trillion KRW in Q1 2025, up 62.9% year-on-year, exceeding both our estimate and the market consensus by 7%.”
The bank’s net interest margin (NIM) rose 4 basis points (bp) quarter-on-quarter, while Korean won-denominated loans grew 0.9%, resulting in net interest income of 3.26 trillion KRW, up 3.5% year-on-year. Despite a decline in loan interest rates, the easing of funding costs from repricing high-interest time deposits helped the group maintain stable margins, Park noted.
Non-interest income also rose 2.5% year-on-year to 1.3 trillion KRW. Gains in equity-related assets driven by lower interest rates contributed to a sharp rise in other operating income, while securities, credit card, and non-life insurance segments also delivered solid performance.
However, credit costs came in at 656 billion KRW, higher than expected, mainly due to one-off provisions: 67.5 billion KRW related to Homeplus and 41 billion KRW in additional provisioning tied to declining recovery rates on overseas commercial real estate collateral.
KB Financial’s CET1 ratio rose to 13.67% in Q1, strengthening the outlook for shareholder returns in the second half of the year. “While CET1 stood at 13.53% in Q4 2024, the company still announced a 300 billion KRW share buyback and a quarterly dividend per share (DPS) of 912 KRW, exceeding market expectations,” Park said.
She added, “Concerns over a decline in shareholder returns following the sharp drop in CET1 in Q4 led to a share price decline, but from a full-year profit perspective, total shareholder return will inevitably increase.”
“This announcement helps dispel earlier concerns and represents a significant step in shareholder return policy,” she noted. “While momentum in bank stocks has stalled following the revaluation phase, this move could serve as a catalyst to reinvigorate investor interest.”
*[KOSPI]KB Financial Group(105560) is the holding company of KB Financial Group, established in 2008. Leveraging its leading market position and strong brand recognition, it engages in various businesses including banking, cards, securities, life insurance, non-life insurance, and savings banks. Market capitalization is 33.27 trillion won(as of April 24, 2025, closing price).