6-K 1 d692961d6k.htm FORM 6-K Form 6-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of March 2014

Commission File Number: 000-53445

 

 

KB Financial Group Inc.

(Translation of registrant’s name into English)

 

 

9-1, 2-ga, Namdaemoon-ro, Jung-gu, Seoul 100-703, Korea

(Address of principal executive office)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F   x            Form 40-F  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ¨

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes  ¨            No   x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- N/A .

 

 

 

 

On March 13, 2014, KB Financial Group Inc. furnished a public notice regarding the convocation of its annual general meeting of shareholders for fiscal year 2013.

 

The agenda for the annual general meeting of shareholders to be held on March 28, 2014 and the detailed contents of such agenda are currently being distributed to shareholders of KB Financial Group Inc. for their reference as they exercise their voting rights.

 

 

  •   Agenda:

 

  1) Approval of financial statements and the proposed dividend payment for fiscal year 2013

 

  2) Appointment of non-executive directors

 

  3) Appointment of members of the Audit Committee, who are non-executive directors

 

  4) Approval of the aggregate remuneration limit for directors

Agenda for Annual General Meeting of

Shareholders for Fiscal Year 2013

Agendum 1. Approval of financial statements and the proposed dividend payment for fiscal year 2013

Please find the following Exhibits attached to this document:

Exhibit Index

99.1         Separate Financial Statements for Fiscal Year 2013

99.2         Consolidated Financial Statements for Fiscal Year 2013

For the proposed dividend payment amount for fiscal year 2013, please refer to Separate Statements of Appropriation of Retained Earnings for the years ended December 31, 2013 and 2012 included in Exhibit 99.1 attached hereto.

Agendum 2. Appointment of non-executive directors

Nominees for Non-Executive Directors(1)

 

Name

(Date of Birth)

   

Current
Position

   

Career

   

Education

    Nationality    Term of
Office

Jae Ho Cho

(New appointment)

(01/18/1955)

    Professor, Seoul National University   

•    Outside Director, SK Telecom Co., Ltd.

•    Director, Kyung Hee Foundation

•    Chair, Capital Markets Division, Committee for Financial Developments of Korea

•    Visiting professor, University of Tokyo

•    Assistant professor, Baruch College, City University of New York

   

 

•    Ph.D. in Finance, Wharton School, University of Pennsylvania

•    M.B.A. in Finance, Wharton School, University of Pennsylvania

•    B.A. in Business Administration, Seoul National University

    Republic
of Korea		    2 years

Myung Jig Kim

(New appointment)

(10/19/1959)

   

Professor, Hanyang University

 

Dean, College of Economics and Finance, Hanyang University

   

•    Non-Executive Director, Meritz Financial Group, Inc.

•    President, Korean Securities Association

•    Editor, Asia-Pacific Journal of Financial Studies

•    Vice President, Korean Finance Association

•    Assistant and Associate Professor, University of Alabama

   

•    Ph.D. in Economics, University of Washington

•    M.A. in Economics, University of Washington

•    B.A. in Economics, Hanyang University

    Republic
of Korea		    2 years

Sung Hwan Shin

(New appointment)

(02/17/1963)

    Professor, Hongik University   

•    Head of Public Fund Evaluation Bureau, Ministry of Strategy and Finance

•    Senior Advisor, Korea Fixed Income Research Institute

•    President, Korean Pension Association

•    Senior Financial Officer, World Bank

•    Research fellow, Korea Institute of Finance

   

•    Ph.D. in Finance, Sloan School of Management, Massachusetts Institute of Technology

•    M.B.A., Sloan School of Management, Massachusetts Institute of Technology

•    B.A. in Economics, Seoul National University

    Republic
of Korea		    2 years

Kyung Jae Lee

(Re-appointment)

(01/30/1939)

    -   

•    CEO, Industrial Bank of Korea

•    CEO, Korea Financial Telecommunications & Clearing Institute

•    Director and Auditor, Bank of Korea

   

•    Ph.D. in Economics, Kookmin University

•    M.A. in Economics, New York University

•    B.A. in Economics, Seoul National University

    Republic
of Korea		    1 year

Name

(Date of Birth)

   

Current
Position

   

Career

   

Education

    Nationality    Term of
Office

Young Jin Kim

(Re-appointment)

(12/11/1949)

    Professor, Seoul National University   

•     Outside Director, Samsung Asset Management

•     Director, Korea Stock Exchange

•     President, Korean Finance Association

   

•     D.B.A. in Finance, Graduate School of Business, Indiana University

•     M.B.A., Columbia University

•     B.A. in Business Administration, Seoul National University

    Republic
of Korea		    1 year

Kun Ho Hwang

(Re-appointment)

(01/23/1951)

    -   

•     Visiting Professor, Seoul National University

•     Chairman & CEO, Korea Financial Investment Association

•     President & CEO, Meritz Securities Co., Ltd.

•     Deputy President, Daewoo Securities Co., Ltd.

   

•     M.A. in Economics, Rutgers University

•     B.A. in Business Administration, Seoul National University

    Republic
of Korea		    1 year

Jong Cheon Lee

(Re-appointment)

(02/03/1951)

    Professor, Soongsil University   

•     Chief Director, Korea Institute for Firm Contribution

•     Chairman, Korean Accounting Association

•     Non-Standing Director, Korea Gas Corporation

•     Member of Advisory Committee, Ministry of Finance and Economy

   

•     Ph.D. in Accounting, University of Illinois

•     M.B.A., Seoul National University

•     B.A. in Business Administration, Seoul National University

    Republic
of Korea		    1 year

Seung Hee Koh

(Re-appointment)

(06/26/1955)

   

Professor,

Sookmyung

Women’s

University

   

•     Advisor, Fair Trade Commission of Korea

•     Vice President, Management Accounting Association of Korea

•     Non-Executive Director, United Asset Management Company

   

•     Ph.D. in Business Administration, University of Oklahoma

•     M.B.A., Indiana University

•     B.A. in Business Administration, Seoul National University

    Republic
of Korea		    1 year

Note: (1) None of the nominees has (i) engaged in any transaction with KB Financial Group Inc. in the past three years or (ii) any relationship with the largest shareholder of KB Financial Group Inc.

Agendum 3. Appointment of members of the Audit Committee, who are non-executive directors

Nominees for members of the Audit Committee who are Non-Executive Directors(1)

 

Name

(Date of Birth)

    Current
Position		   

Career

   

Education

    Nationality    Term of
Office

Sung Hwan Shin

(New appointment)

(02/17/1963)

    Professor,
Hongik
University		   

•     Head of Public Fund Evaluation Bureau, Ministry of Strategy and Finance

•     Senior Advisor, Korea Fixed Income Research Institute

•     President, Korean Pension Association

•     Senior Financial Officer, World Bank

•     Research fellow, Korea Institute of Finance

   

•     Ph.D. in Finance, Sloan School of Management, Massachusetts Institute of Technology

•     M.B.A., Sloan School of Management, Massachusetts Institute of Technology

•     B.A. in Economics, Seoul National University

    Republic
of Korea		    1 year

Kyung Jae Lee

(Re-appointment)

(01/30/1939)

    -   

•     CEO, Industrial Bank of Korea

•      CEO, Korea Financial Telecommunications & Clearing Institute

•     Director and Auditor, Bank of Korea

   

•     Ph.D. in Economics, Kookmin University

•     M.A. in Economics, New York University

•     B.A. in Economics, Seoul National University

    Republic
of Korea		    1 year

Young Jin Kim

(Re-appointment)

(12/11/1949)

    Professor,
Seoul
National
University		   

•     Outside Director, Samsung Asset Management

•     Director, Korea Stock Exchange

•     President, Korean Finance Association

   

•     D.B.A. in Finance, Graduate School of Business, Indiana University

•     M.B.A., Columbia University

•     B.A. in Business Administration, Seoul National University

    Republic
of Korea		    1 year

Jong Cheon Lee

(Re-appointment)

(02/03/1951)

    Professor,
Soongsil
University		   

•     Chief Director, Korea Institute for Firm Contribution

•     Chairman, Korean Accounting Association

•     Non-Standing Director, Korea Gas Corporation

•     Member of Advisory Committee, Ministry of Finance and Economy

   

•     Ph.D. in Accounting, University of Illinois

•     M.B.A., Seoul National University

•     B.A. in Business Administration, Seoul National University

    Republic
of Korea		    1 year

Seung Hee Koh

(Re-appointment)

(06/26/1955)

    Professor,

Sookmyung

Women’s

University

   

•     Advisor, Fair Trade Commission of Korea

•     Vice President, Management Accounting Association of Korea

•     Non-Executive Director, United Asset Management Company

   

•     Ph.D. in Business Administration, University of Oklahoma

•     M.B.A., Indiana University

•     B.A. in Business Administration, Seoul National University

    Republic
of Korea		    1 year

Note: (1) None of the nominees has (i) engaged in any transaction with KB Financial Group Inc. in the past three years or (ii) any relationship with the largest shareholder of KB Financial Group Inc.

Agendum 4. Approval of the aggregate remuneration limit for directors

 

    

For fiscal year 2012

   

For fiscal year 2013

No. of Directors

(No. of Non-Executive Directors)

   

13(9)*

    10(9)
Aggregate Remuneration Limit    Won 5 billion will be proposed as the maximum amount of aggregate remuneration that may be disbursed to the directors of KB Financial Group Inc. for fiscal year 2013. The board of directors will approve and ratify the payment allocation. Additionally, 250,000 treasury shares (or the equivalent monetary value) will be proposed as the maximum aggregate amount of shares that may be disbursed from September 29, 2012 to September 28, 2015 to the directors of KB Financial Group Inc. as long-term incentives over the term of their office. The board of directors will approve and ratify the standard and method of allocation and disbursements thereof.    Won 2.5 billion will be proposed as the maximum amount of aggregate remuneration that may be disbursed to the directors of KB Financial Group Inc. for fiscal year 2014. The board of directors will approve and ratify the payment allocation. Additionally, 100,000 treasury shares (or the equivalent monetary value) will be proposed as the maximum aggregate amount of shares that may be disbursed from July 13, 2013 to July 12, 2016 to the directors of KB Financial Group Inc. as long-term incentives over the term of their office. The board of directors will approve and ratify the standard and method of allocation and disbursements thereof.

 

* Includes Vaughn Richtor, who has resigned his post as a non-standing director of KB Financial Group Inc. on February 19, 2013.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

   

KB Financial Group Inc.                    

 

(Registrant)

Date: March 13, 2014

     By: /s/ Woong-Won Yoon                  
   

 

(Signature)

    Name:     Woong-Won Yoon
    Title:     Deputy President & CFO

Exhibit 99.1

KB Financial Group Inc.

Separate Statements of Financial Position

December 31, 2013 and 2012, and January 1, 2012

 

 

(In millions of Korean won)    December 31, 2013     December 31, 2012     January 1, 2012  

Assets

       

Cash and due from financial institutions

    ￦ 77,298      ￦ 96,234      ￦ 32,031   

Loans

      10,000        25,000        60,000   

Investments in subsidiaries

      18,292,443        17,944,848        17,773,322   

Property and equipment

      642        351        759   

Intangible assets

      10,133        9,122        10,531   

Deferred income tax assets

      4,203        3,800        2,445   

Other assets

      269,823        310,673        631,602   
  

 

 

    

 

 

    

 

 

  

Total assets

    ￦ 18,664,542      ￦ 18,390,028      ￦ 18,510,690   
  

 

 

    

 

 

    

 

 

  

Liabilities

       

Debts

      —          —          130,000   

Debentures

    ￦ 349,157      ￦ —        ￦ 49,988   

Net defined benefit liabilities

      1,433        1,384        992   

Current income tax liabilities

      209,928        257,535        578,729   

Other liabilities

      55,602        46,767        34,701   
  

 

 

    

 

 

    

 

 

  

Total liabilities

      616,120        305,686        794,410   
  

 

 

    

 

 

    

 

 

  

Equity

       

Share capital

      1,931,758        1,931,758        1,931,758   

Capital surplus

      13,513,809        13,513,809        13,513,809   

Accumulated other comprehensive loss

      (2,715 )      (2,780 )      (1,918 ) 

Retained earnings

      2,605,570        2,641,555        2,272,631   
  

 

 

    

 

 

    

 

 

  

Total equity

      18,048,422        18,084,342        17,716,280   
  

 

 

    

 

 

    

 

 

  

Total liabilities and equity

    ￦ 18,664,542      ￦ 18,390,028      ￦ 18,510,690   
  

 

 

    

 

 

    

 

 

  

KB Financial Group Inc.

Separate Statements of Comprehensive Income

Years Ended December 31, 2013 and 2012

 

 

(In millions of Korean won, except per share amounts)    2013     2012  

Interest income

    ￦ 3,859      ￦ 6,018   

Interest expense

      (5,227 )      (3,025 ) 
  

 

 

    

 

 

  

Net interest income

      (1,368 )      2,993   
  

 

 

    

 

 

  

Fee and commission income

      —          —     

Fee and commission expense

      (6,270 )      (4,130 ) 
  

 

 

    

 

 

  

Net fee and commission income

      (6,270 )      (4,130 ) 
  

 

 

    

 

 

  

Net other operating income

      245,044        687,925   
  

 

 

    

 

 

  

General and administrative expenses

      (40,657 )      (40,459 ) 
  

 

 

    

 

 

  

Operating profit before provision for credit losses

      196,749        646,329   

Provision for credit losses

      —          —     
  

 

 

    

 

 

  

Operating profit

      196,749        646,329   

Net non-operating income(expense)

      (1,346 )      (312 ) 
  

 

 

    

 

 

  

Profit before tax

      195,403        646,017   

Income tax benefit

      423        1,080   
  

 

 

    

 

 

  

Profit for the year

      195,826        647,097   
  

 

 

    

 

 

  

Remeasurements of net defined benefit liabilities

      65        (862 ) 
  

 

 

    

 

 

  

Items that will not be reclassified to profit or loss

      65        (862 ) 
  

 

 

    

 

 

  

Other comprehensive income(loss) for the year, net of tax

      65        (862 ) 
  

 

 

    

 

 

  

Total comprehensive income for the year

    ￦ 195,891      ￦ 646,235   
  

 

 

    

 

 

  

Earnings per share

     

Basic earnings per share

    ￦ 507      ￦ 1,675   

Diluted earnings per share

      505        1,670   

KB Financial Group Inc.

Statements of Appropriation of Retained Earnings

For the years ended December 31, 2013 and 2012

(Date of appropriation for 2013: March 28, 2014)

(Date of appropriation for 2012: March 22, 2013)

 

 

(In millions of Korean won)    2013      2012  

Unappropriated retained earnings

      

Balance at the beginning of year

    ￦ 1,237,531       ￦ 883,220   

Changes in accounting policy

      —           1,918   

Profit for the year

      195,826         647,097   
     1,433,357         1,532,235   

Transfers such as discretionary reserves

      

Regulatory reserve for credit losses

      280         1,731   
     280         1,731   

Appropriation of retained earnings

      

Legal reserve

      19,583         64,624   

Cash dividends

      212,759         296,435   

(Dividends per common share:￦500 (10.0%) in 2013)

(Dividends per common share:￦600 (12.0%) in 2012)

      193,176         231,811   

Unappropriated retained earnings to be carried over to subsequent year

    ￦ 1,220,878       ￦ 1,237,531   

KB Financial Group Inc.

Separate Statements of Changes in Equity

Years Ended December 31, 2013 and 2012

 

 

                   Accumulated              
                   Other              
(In millions of Korean won)    Share      Capital      Comprehensive     Retained     Total  
     Capital      Surplus      Loss     Earnings     Equity  

Balance at January 1, 2012

    ￦ 1,931,758       ￦ 13,513,809       ￦ —        ￦ 2,270,713      ￦ 17,716,280   

Changes in accounting policy

      —           —           (1,918 )      1,918        —     
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Restated balance

      1,931,758         13,513,809         (1,918 )      2,272,631        17,716,280   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Comprehensive income

             

Profit for the year

      —           —           —          647,097        647,097   

Remeasurements of net defined benefit liabilities

      —           —           (862 )      —          (862 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Total comprehensive income

      —           —           (862 )      647,097        646,235   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Transactions with shareholders

             

Dividends

      —           —           —          (278,173 )      (278,173 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Total transactions with shareholders

      —           —           —          (278,173 )      (278,173 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Balance at December 31, 2012

    ￦ 1,931,758       ￦ 13,513,809       ￦ (2,780 )    ￦ 2,641,555      ￦ 18,084,342   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Balance at January 1, 2013

    ￦ 1,931,758       ￦ 13,513,809       ￦ (2,780 )    ￦ 2,641,555      ￦ 18,084,342   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Comprehensive income

             

Profit for the year

      —           —           —          195,826        195,826   

Remeasurements of net defined benefit liabilities

      —           —           65        —          65   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Total comprehensive income

      —           —           65        195,826        195,891   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Transactions with shareholders

             

Dividends

      —           —           —          (231,811 )      (231,811 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Total transactions with shareholders

      —           —           —          (231,811 )      (231,811 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

Balance at December 31, 2013

    ￦ 1,931,758       ￦ 13,513,809       ￦ (2,715 )    ￦ 2,605,570      ￦ 18,048,422   
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

  

KB Financial Group Inc.

Separate Statements of Cash Flows

Years Ended December 31, 2013 and 2012

 

 

(In millions of Korean won)    2013     2012  

Cash flows from operating activities

     

Profit for the year

    ￦ 195,826      ￦ 647,097   
  

 

 

    

 

 

  

Adjustment for non-cash items

     

Depreciation and amortization

      816        1,487   

Share-based payments

      950        3,641   

Net interest income

      (564 )      (765 ) 

Impairment losses on investments in subsidiaries

      36,995        —     

Net other expense

      2,805        3,321   
  

 

 

    

 

 

  
     41,002        7,684   
  

 

 

    

 

 

  

Changes in operating assets and Liabilities

     

Due from financial institutions

      —          12,000   

Deferred income tax assets

      (403 )      (1,355 ) 

Other assets

      9        1,056   

Other liabilities

      (336 )      (3,578 ) 
  

 

 

    

 

 

  
     (730 )      8,123   
  

 

 

    

 

 

  

Net cash generated from operating activities

      236,098        662,904   
  

 

 

    

 

 

  

Cash flows from investing activities

     

Acquisition of investments in subsidiaries

      (384,590 )      (171,526 ) 

Collection of loans

      15,000        35,000   

Acquisition of property and equipment

      (627 )      (114 ) 

Acquisition of intangible assets

      (2,656 )      (313 ) 

Disposal of intangible assets

      757        —     

Net decrease(increase) in guarantee deposits paid

      (182 )      8,427   

Others

      (2 )      (2 ) 
  

 

 

    

 

 

  

Net cash used in investing activities

      (372,300 )      (128,528 ) 
  

 

 

    

 

 

  

Cash flows from financing activities

     

Increase in debts

      315,000        170,000   

Decrease in debts

      (315,000 )      (300,000 ) 

Increase in debentures

      349,077        —     

Decrease in debentures

      —          (50,000 ) 

Distribution of dividends

      (231,811 )      (278,173 ) 
  

 

 

    

 

 

  

Net cash provided by(used in) financing activities

      117,266        (458,173 ) 
  

 

 

    

 

 

  

Net increase(decrease) in cash and cash equivalents

      (18,936 )      76,203   

Cash and cash equivalents at the beginning of the year

      96,231        20,028   
  

 

 

    

 

 

  

Cash and cash equivalents at the end of the year

    ￦ 77,295      ￦ 96,231   
  

 

 

    

 

 

  

Exhibit 99.2

KB Financial Group Inc. and Subsidiaries

Consolidated Statements of Financial Position

December 31, 2013 and 2012, and January 1, 2012

 

 

(in millions of Korean won)    December 31, 2013      December 31, 2012      January 1, 2012  

Assets

         

Cash and due from financial institutions

    ￦ 14,792,654       ￦ 10,592,605       ￦ 9,186,557   

Financial assets at fair value through profit or loss

      9,328,742         9,559,719         9,169,102   

Derivative financial assets

      1,819,409         2,091,285         2,499,445   

Loans

      219,001,356         213,644,791         213,027,696   

Financial investments

      34,849,095         36,467,352         34,992,681   

Investments in associates

      755,390         934,641         793,602   

Property and equipment

      3,060,843         3,100,393         3,182,746   

Investment property

      166,259         52,974         51,552   

Intangible assets

      443,204         493,131         461,986   

Deferred income tax assets

      15,422         18,432         18,944   

Assets held for sale

      37,718         35,412         9,931   

Other assets

      7,568,063         8,760,319         7,475,865   
  

 

 

     

 

 

     

 

 

  

Total assets

    ￦ 291,838,155       ￦ 285,751,054       ￦ 280,870,107   
  

 

 

     

 

 

     

 

 

  

Liabilities

         

Financial liabilities at fair value through profit or loss

    ￦ 1,115,202       ￦ 1,851,135       ￦ 1,388,079   

Derivative financial liabilities

      1,795,339         2,054,742         2,037,793   

Deposits

      200,882,064         197,346,205         193,258,556   

Debts

      14,101,331         15,965,458         16,821,233   

Debentures

      27,039,534         24,270,212         27,170,879   

Provisions

      678,073         669,729         789,780   

Net defined benefit liabilities

      64,473         83,723         127,437   

Current income tax liabilities

      211,263         264,666         588,825   

Deferred income tax liabilities

      61,816         154,303         242,308   

Other liabilities

      20,236,229         18,327,740         15,280,218   
  

 

 

     

 

 

     

 

 

  

Total liabilities

      266,185,324         260,987,913         257,705,108   
  

 

 

     

 

 

     

 

 

  

Equity

         

Share capital

      1,931,758         1,931,758         1,931,758   

Capital surplus

      15,854,605         15,840,300         15,841,824   

Accumulated other comprehensive income

      336,312         295,142         161,039   

Retained earnings

      7,530,156         6,501,419         5,048,558   
  

 

 

     

 

 

     

 

 

  

Equity attributable to shareholders of the parent company

      25,652,831         24,568,619         22,983,179   

Non-controlling interests

      —           194,522         181,820   
  

 

 

     

 

 

     

 

 

  

Total equity

      25,652,831         24,763,141         23,164,999   
  

 

 

     

 

 

     

 

 

  

Total liabilities and equity

    ￦ 291,838,155       ￦ 285,751,054       ￦ 280,870,107   
  

 

 

     

 

 

     

 

 

  

KB Financial Group Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

Years Ended December 31, 2013 and 2012

 

 

(In millions of Korean won, except per share amounts)    2013     2012  

Interest income

    ￦ 12,356,930      ￦ 14,210,106   

Interest expense

      (5,834,098 )      (7,172,323 ) 
  

 

 

    

 

 

  

Net interest income

      6,522,832        7,037,783   
  

 

 

    

 

 

  

Fee and commission income

      2,657,365        2,753,876   

Fee and commission expense

      (1,178,126 )      (1,187,170 ) 
  

 

 

    

 

 

  

Net fee and commission income

      1,479,239        1,566,706   
  

 

 

    

 

 

  

Net gains(losses) on financial assets/liabilities at fair value through profit or loss

      756,822        811,964   
  

 

 

    

 

 

  

Net other operating income(expense)

      (1,304,765 )      (1,531,942 ) 
  

 

 

    

 

 

  

General and administrative expenses

      (3,983,564 )      (3,845,610 ) 
  

 

 

    

 

 

  

Operating profit before provision for credit losses

      3,470,564        4,038,901   

Provision for credit losses

      (1,443,572 )      (1,606,703 ) 
  

 

 

    

 

 

  

Net operating profit

      2,026,992        2,432,198   
  

 

 

    

 

 

  

Share of profit(loss) of associates

      (199,392 )      (15,282 ) 

Net other non-operating income(expense)

      (12,309 )      (118,272 ) 
  

 

 

    

 

 

  

Net non-operating profit (loss)

      (211,701 )      (133,554 ) 
  

 

 

    

 

 

  

Profit before income tax

      1,815,291        2,298,644   

Income tax expense

      (551,586 )      (558,511 ) 
  

 

 

    

 

 

  

Profit for the year

      1,263,705        1,740,133   
  

 

 

    

 

 

  

Remeasurements of net defined benefit liabilities

      40,984        (30,272 ) 
  

 

 

    

 

 

  

Items that will not be reclassified to profit or loss

      40,984        (30,272 ) 
  

 

 

    

 

 

  

Exchange differences on translating foreign operations

      (2,298 )      (25,690 ) 

Change in value of financial investments

      (3,591 )      245,757   

Shares of other comprehensive income of associates

      (9,811 )      (44,263 ) 

Cash flow hedges

      1,618        (813 ) 
  

 

 

    

 

 

  

Items that may be reclassified subsequently to profit or loss

      (14,082 )      174,991   
  

 

 

    

 

 

  

Other comprehensive income for the year, net of tax

      26,902        144,719   
  

 

 

    

 

 

  

Total comprehensive income for the year

    ￦ 1,290,607      ￦ 1,884,852   
  

 

 

    

 

 

  

Profit attributable to:

     

Shareholders of the parent company

    ￦ 1,260,509      ￦ 1,731,034   

Non-controlling interests

      3,196        9,099   
  

 

 

    

 

 

  
   ￦ 1,263,705      ￦ 1,740,133   
  

 

 

    

 

 

  

Total comprehensive income for the year attributable to:

     

Shareholders of the parent company

    ￦ 1,301,679      ￦ 1,865,137   

Non-controlling interests

      (11,072 )      19,715   
  

 

 

    

 

 

  
   ￦ 1,290,607      ￦ 1,884,852   
  

 

 

    

 

 

  

Earnings per share

     

Basic earnings per share

    ￦ 3,263      ￦ 4,480   

Diluted earnings per share

      3,249        4,467   

KB Financial Group Inc. and Subsidiaries

Consolidated Statements of Changes in Equity

Years Ended December 31, 2013 and 2012

 

 

     Equity attributable to shareholders of the parent company              
                 

Accumulated

Other

Comprehensive

Income

                    
                                   
(in millions of Korean won)    Share      Capital       Retained     Non-controlling     Total  
     Capital      Surplus       Earnings     Interests     Equity  

Balance at January 1, 2012

    ￦ 1,931,758       ￦ 15,841,824      ￦ 191,642      ￦ 4,952,751      ￦ 181,820      ￦ 23,099,795   

Changes in accounting policy

      —           —          (30,603 )      95,807        —          65,204   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Restated balance

      1,931,758         15,841,824        161,039        5,048,558        181,820        23,164,999   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Comprehensive income

              

Profit for the year

      —           —          —          1,731,034        9,099        1,740,133   

Remeasurements of net defined benefit liabilities

      —           —          (30,253 )        (19 )      (30,272 ) 

Exchange differences on translating foreign operations

      —           —          (25,597 )      —          (93 )      (25,690 ) 

Change in value of financial investments

      —           —          235,029        —          10,728        245,757   

Shares of other comprehensive income of associates

      —           —          (44,263 )      —          —          (44,263 ) 

Cash flow hedges

      —           —          (813 )      —          —          (813 ) 
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive income

      —           —          134,103        1,731,034        19,715        1,884,852   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Transactions with shareholders

              

Dividends paid to shareholders of the parent company

      —           —          —          (278,173 )      —          (278,173 ) 

Changes in interest in subsidiaries

      —           (1,524 )      —          —          (7,013 )      (8,537 ) 
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total transactions with shareholders

      —           (1,524 )      —          (278,173 )      (7,013 )      (286,710 ) 
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance at December 31, 2012

    ￦ 1,931,758       ￦ 15,840,300      ￦ 295,142      ￦ 6,501,419      ￦ 194,522      ￦ 24,763,141   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance at January 1, 2013

    ￦ 1,931,758       ￦ 15,840,300      ￦ 295,142      ￦ 6,501,419      ￦ 194,522      ￦ 24,763,141   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Comprehensive income

              

Profit for the year

      —           —          —          1,260,509        3,196        1,263,705   

Remeasurements of net defined benefit liabilities

      —           —          40,984        —          —          40,984   

Exchange differences on translating foreign operations

      —           —          (2,372 )      —          74        (2,298 ) 

Change in value of financial investments

      —           —          10,751        —          (14,342 )      (3,591 ) 

Shares of other comprehensive income of associates

      —           —          (9,811 )      —          —          (9,811 ) 

Cash flow hedges

      —           —          1,618        —          —          1,618   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive income

      —           —          41,170        1,260,509        (11,072 )      1,290,607   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Transactions with shareholders

              

Dividends paid to shareholders of the parent company

      —           —          —          (231,811 )      —          (231,811 ) 

Changes in interest in subsidiaries

      —           14,305        —          39        (183,450 )      (169,106 ) 
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total transactions with shareholders

      —           14,305        —          (231,772 )      (183,450 )      (400,917 ) 
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance at December 31, 2013

    ￦ 1,931,758       ￦ 15,854,605      ￦ 336,312      ￦ 7,530,156      ￦ —        ￦ 25,652,831   
  

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

KB Financial Group Inc. and Subsidiaries

Consolidated Statements of Cash Flows

Years Ended December 31, 2013 and 2012

 

 

(in millions of Korean won)    2013     2012  

Cash flows from operating activities

     

Profit for the year

    ￦ 1,263,705      ￦ 1,740,133   
  

 

 

    

 

 

  

Adjustment for non-cash items

     

Net loss(gain) on financial assets/liabilities at fair value through profit or loss

      (110,425 )      (247,854 ) 

Net loss(gain) on derivative financial instruments for hedging purposes

      48,787        15,165   

Adjustment of fair value of derivative financial instruments

      699        42   

Provision for credit loss

      1,443,572        1,606,703   

Net loss(gain) on financial investments

      (1,191 )      148,211   

Share of loss(profit) of associates

      199,392        15,282   

Depreciation and amortization expense

      286,858        328,320   

Other net losses on property and equipment/intangible assets

      39,777        40,881   

Share-based payments

      17,289        13,871   

Policy reserve appropriation

      761,877        1,305,730   

Post-employment benefits

      172,579        172,391   

Net interest expense

      314,866        229,691   

Loss(gains) on foreign currency translation

      17,082        (148,877 ) 

Net other expense(income)

      (24,981 )      2,783   
  

 

 

    

 

 

  
     3,166,181        3,482,339   
  

 

 

    

 

 

  

Changes in operating assets and liabilities

     

Financial asset at fair value through profit or loss

      214,181        (3,102,488 ) 

Derivative financial instruments

      116,660        193,373   

Loans

      (7,335,434 )      (2,964,229 ) 

Deferred income tax assets

      1,349        3,211   

Other assets

      (5,078,285 )      2,201,280   

Financial liabilities at fair value through profit or loss

      (773,558 )      357,825   

Deposits

      2,584,993        4,495,876   

Deferred income tax liabilities

      (74,463 )      (138,374 ) 

Other liabilities

      (430,856 )      1,375,612   
  

 

 

    

 

 

  
     (10,775,413 )      2,422,086   
  

 

 

    

 

 

  

Net cash generated from (used in) operating activities

      (6,345,527 )      7,644,558   
  

 

 

    

 

 

  

Cash flows from investing activities

     

Disposal of financial investments

      25,655,149        24,805,560   

Acquisition of financial investments

      (23,020,912 )      (26,141,095 ) 

Decrease in investments in associates

      20,554        16,573   

Acquisition of investments in associates

      (23,340 )      (217,081 ) 

Disposal of property and equipment

      1,070        16,912   

Acquisition of property and equipment

      (153,469 )      (143,139 ) 

Acquisition of investment property

      (114,609 )      —     

Disposal of intangible assets

      5,072        10,176   

Acquisition of intangible assets

      (68,091 )      (81,899 ) 

Business combination, net of cash acquired

      322,641        40,575   

Others

      1,554,752        (838,816 ) 
  

 

 

    

 

 

  

Net cash provided by (used in) investing activities

      4,178,817        (2,532,234 ) 
  

 

 

    

 

 

  

Cash flows from financing activities

     

Net cash flows from derivative financial instruments for hedging purposes

      10,977        75,761   

Net decrease in debts

      (1,990,258 )      (796,842 ) 

Increase in debentures

      10,758,948        10,282,920   

Decrease in debentures

      (7,924,609 )      (12,945,650 ) 

Increase in other payables from trust accounts

      414,279        456,449   

Dividends paid to shareholders of the parent company

      (231,811 )      (278,173 ) 

Changes in interest in subsidiaries

      (168,293 )      (8,048 ) 

Others

      837,906        (38,680 ) 
  

 

 

    

 

 

  

Net cash provided by (used in) financing activities

      1,707,139        (3,252,263 ) 
  

 

 

    

 

 

  

Effect of exchange rate changes on cash and cash equivalents

      41,452        (13,560 ) 
  

 

 

    

 

 

  

Net increase(decrease) in cash and cash equivalents

      (418,119 )      1,846,501   

Cash and cash equivalents at the beginning of the year

      6,587,305        4,740,804   
  

 

 

    

 

 

  

Cash and cash equivalents at the end of the year

    ￦ 6,169,186      ￦ 6,587,305