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 2023

Commission File Number: 000-53445

KB Financial Group Inc.

(Translation of registrant’s name into English)

26, Gukjegeumyung-ro 8-gil, Yeongdeungpo-gu, Seoul 07331, 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  ☒             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):  ☐

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

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):  ☐

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Audit Report of Kookmin Bank for Fiscal Year 2022

On March 7, 2023, KB Financial Group Inc. disclosed audit reports of Kookmin Bank, its wholly-owned subsidiary, for fiscal year 2022 based on the International Financial Reporting Standards as adopted by the Republic of Korea (including the consolidated and separate financial statements of Kookmin Bank as of and for the years ended December 31, 2022 and 2021 and related notes) received from KPMG Samjong Accounting Corp., its independent auditor. The financial statements in such reports have not been approved by the shareholders of Kookmin Bank and remain subject to change.

KB Financial Group Inc. is furnishing the following documents as exhibits to this Form 6-K filing:

Exhibit 99.1: An English-language translation of the Consolidated Audit Report of Kookmin Bank for FY 2022.

Exhibit 99.2: An English-language translation of the Separate Audit Report of Kookmin Bank for FY 2022.

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 7, 2023	By:	/s/ Scott Y. H. Seo
		(Signature)
		Name: Scott Y. H. Seo
		Title: Senior Executive Vice President and Chief Finance Officer

Exhibit 99.1

Kookmin Bank and Subsidiaries

Consolidated Financial Statements

December 31, 2022 and 2021

(With Independent Auditors’ Report Thereon)

Contents

	Page
Independent Auditors’ Report		1
Consolidated Statements of Financial Position		3
Consolidated Statements of Comprehensive Income		4
Consolidated Statements of Changes in Equity		5
Consolidated Statements of Cash Flows		6
Notes to the Consolidated Financial Statements		7

Independent Auditors’ Report

Based on a report originally issued in Korean

To the Shareholder and Board of Directors

Kookmin Bank

Opinion

We have audited the consolidated financial statements of Kookmin Bank and its subsidiaries (collectively the “Group”), which comprise the statements of financial position as of December 31, 2022 and 2021, the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of the Group as of December 31, 2022 and 2021, and its financial performance and its cash flows for the year then ended in accordance with Korean International Financial Reporting Standards (“K-IFRS”).

Basis for Opinion

We conducted our audits in accordance with Korean Standards on Auditing (KSAs). Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in the Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with K-IFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Group’s financial reporting process.

1

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

• Evaluate the appropriateness of accounting policies used in the preparation of the consolidated financial statements and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

/s/ KPMG Samjong Accounting Corp.

Seoul, Korea

March 7, 2023

This report is effective as of March 7, 2023, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying consolidated financial statements and notes thereto. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

2

Kookmin Bank and Subsidiaries

Consolidated Statements of Financial Position

December 31, 2022 and 2021

(In millions of Korean won)	Notes		December 31, 2022			December 31, 2021
Assets
Cash and due from financial institutions		2,4,6,7,36	W	25,127,794		W	25,164,991
Financial assets at fair value through profit or loss		4,6,8,12		21,213,408			18,834,364
Derivative financial assets		4,6,9		7,767,592			2,965,626
Loans measured at amortized cost		4,6,8,10,11		374,671,976			361,144,701
Financial investments		4,6,8,12		75,250,169			63,744,909
Investments in associates		13		529,981			390,957
Property and equipment		8,14		3,837,511			3,933,943
Investment property		14		345,156			325,065
Intangible assets		15		1,054,696			1,028,494
Net defined benefit asset		23		307,749			—
Current income tax assets		32		192,041			61,314
Deferred income tax assets		16,32		181,257			149,869
Assets held for sale		17		211,757			237,318
Other assets		4,6,18		7,078,425			5,583,347
Total assets			W	517,769,512		W	483,564,898
Liabilities
Financial liabilities at fair value through profit or loss		4,6	W	108,862		W	112,698
Derivative financial liabilities		4,6,9		7,271,434			2,749,412
Deposits		4,6,19		381,746,749			363,141,416
Borrowings		4,6,20		45,073,117			32,523,161
Debentures		4,6,21		29,787,722			29,718,734
Provisions		22		533,370			426,867
Net defined benefit liabilities		23		16,243			155,284
Current income tax liabilities		32		63,029			57,281
Deferred income tax liabilities		16,32		153,844			701,561
Other liabilities		4,6,24,30		19,291,883			21,089,571
Total liabilities				484,046,253			450,675,985
Equity
Capital stock		25		2,021,896			2,021,896
Hybrid securities		25		873,850			574,523
Capital surplus		25		5,025,335			5,025,335
Accumulated other comprehensive income		25,34		12,751			1,395,156
Retained earnings		25,33,34		25,834,192			23,660,721
(Provision of regulatory reserve for credit losses December 31, 2022: W2,915,162 million December 31, 2021: W2,534,401 million)
(Amounts estimated to be appropriated December 31, 2022: W102,853 million December 31, 2021: W380,761 million)
Equity attributable to the shareholder of the Parent Company				33,768,024			32,677,631
Non-controlling interests				(44,765	)		211,282
Total equity				33,723,259			32,888,913
Total liabilities and equity			W	517,769,512		W	483,564,898

The above consolidated statements of financial position should be read in conjunction with the accompanying notes.

3

Kookmin Bank and Subsidiaries

Consolidated Statements of Comprehensive Income

Years Ended December 31, 2022 and 2021

(In millions of Korean won)	Notes		2022			2021
Interest income			W	15,358,701		W	10,674,361
Interest income from financial instruments at fair value through other comprehensive income and amortized cost				15,068,856			10,515,589
Interest income from financial instruments at fair value through profit or loss				289,845			158,772
Interest expense				(6,067,680	)		(2,945,885	)
Net interest income		26		9,291,021			7,728,476
Fee and commission income				1,530,158			1,586,944
Fee and commission expense				(433,550	)		(399,063	)
Net fee and commission income		27		1,096,608			1,187,881
Net gains on financial instrument at fair value through profit or loss		28		210,581			342,834
Net other operating expenses		29		(944,100	)		(819,739	)
General and administrative expenses		14,15,23,30,40		(4,697,951	)		(4,402,731	)
Operating income before provision for credit losses				4,956,159			4,036,721
Provision for credit losses		7,11,12,18,22		(1,121,170	)		(522,728	)
Net operating income				3,834,989			3,513,993
Share of profit of associates		13		12,666			57,156
Net other non-operating expenses		31		(37,865	)		(79,605	)
Net non-operating expenses				(25,199	)		(22,449	)
Profit before income tax expense				3,809,790			3,491,544
Income tax expense		32		(1,081,483	)		(953,515	)
Profit for the period				2,728,307			2,538,029
(Adjusted profit after provision of regulatory reserve for credit losses		25
December 31, 2022: W2,893,162 million
December 31, 2021: W2,210,003 million)
Items that will not be reclassified to profit or loss:
Remeasurements of net defined benefit liabilities		23		178,516			(71,615	)
Gains (losses) on equity securities at fair value through other comprehensive income				(953,990	)		873,707
Items that may be subsequently reclassified to profit or loss:
Currency translation differences				145,979			208,480
Losses on debt securities at fair value through other comprehensive income				(467,183	)		(274,010	)
Share of other comprehensive income (loss) of associates				(64	)		165
Losses on hedging instruments of net investments in foreign operations		9		(64,990	)		(54,409	)
Gains on cash flow hedging instruments		9		34,010			9,984
Other comprehensive income (loss) for the period, net of tax		34		(1,127,722	)		692,302
Total comprehensive income for the period			W	1,600,585		W	3,230,331
Profit (loss) attributable to:
Shareholder of the Parent Company			W	2,996,015		W	2,590,764
Non-controlling interests				(267,708	)		(52,735	)
			W2,728,307			W2,538,029
Total comprehensive income (loss) for the period attributable to:
Shareholder of the Parent Company			W	1,856,632		W	3,265,921
Non-controlling interests				(256,047	)		(35,590	)
			W1,600,585			W3,230,331

The above consolidated statements of comprehensive income should be read in conjunction with the accompanying notes.

4

Kookmin Bank and Subsidiaries

Consolidated Statements of Changes in Equity

Years Ended December 31, 2022 and 2021

	Attributable to the shareholder of the Parent Company
(In millions of Korean won)	Capital stock		Hybrid securities		Capital surplus		Accumulated other comprehensive income			Retained earnings			Non-controlling interests			Total equity
Balance as of January 1, 2021	W	2,021,896	W	574,523	W	4,808,482	W	494,445		W	22,243,552		W	265,176		W	30,408,074
Comprehensive income for the period
Profit for the period		—		—		—		—			2,590,764			(52,735	)		2,538,029
Remeasurements of net defined benefit liabilities		—		—		—		(72,054	)		—			439			(71,615	)
Gains (losses) on equity securities at fair value through other comprehensive income		—		—		—		1,105,217			(231,510	)		—			873,707
Currency translation differences		—		—		—		192,705			—			15,775			208,480
Gains (losses) on debt securities at fair value through other comprehensive income		—		—		—		(274,941	)		—			931			(274,010	)
Share of other comprehensive loss of associates		—		—		—		165			—			—			165
Losses on hedging instruments of net investments in foreign operations		—		—		—		(54,409	)		—			—			(54,409	)
Gains on cash flow hedging instruments		—		—		—		9,984			—			—			9,984
Total comprehensive income for the period		—		—		—		906,667			2,359,254			(35,590	)		3,230,331
Transactions with the shareholder
Dividends		—		—		—		—			(917,941	)		—			(917,941	)
Dividends on hybrid securities		—		—		—		—			(24,144	)		—			(24,144	)
Transactions with non-controlling interests		—		—		216,853		(5,956	)		—			(18,304	)		192,593
Total transactions with the shareholder		—		—		216,853		(5,956	)		(942,085	)		(18,304	)		(749,492	)
Balance as of December 31, 2021	W	2,021,896	W	574,523	W	5,025,335	W	1,395,156		W	23,660,721		W	211,282		W	32,888,913
Balance as of January 1, 2022	W	2,021,896	W	574,523	W	5,025,335	W	1,395,156		W	23,660,721		W	211,282		W	32,888,913
Comprehensive income for the period
Profit for the period		—		—		—		—			2,996,015			(267,708	)		2,728,307
Remeasurements of net defined benefit liabilities		—		—		—		178,310			—			206			178,516
Gains (losses) on equity securities at fair value through other comprehensive income		—		—		—		(1,197,012	)		243,022			—			(953,990	)
Currency translation differences		—		—		—		133,064			—			12,915			145,979
Gains (losses) on debt securities at fair value through other comprehensive income		—		—		—		(465,723	)		—			(1,460	)		(467,183	)
Share of other comprehensive loss of associates		—		—		—		(64	)		—			—			(64	)
Losses on hedging instruments of net investments in foreign operations		—		—		—		(64,990	)		—			—			(64,990	)
Gains on cash flow hedging instruments		—		—		—		34,010			—			—			34,010
Total comprehensive income for the period		—		—		—		(1,382,405	)		3,239,037			(256,047	)		1,600,585
Transactions with the shareholder
Dividends		—		—		—		—			(1,031,167	)		—			(1,031,167	)
Issuance of hybrid securities		—		299,327		—		—			—			—			299,327
Dividends on hybrid securities		—		—		—		—			(34,399	)		—			(34,399	)
Total transactions with the shareholder		—		299,327		—		—			(1,065,566	)		—			(766,239	)
Balance as of December 31, 2022	W	2,021,896	W	873,850	W	5,025,335	W	12,751		W	25,834,192		W	(44,765	)	W	33,723,259

The above consolidated statements of changes in equity should be read in conjunction with the accompanying notes.

5

Kookmin Bank and Subsidiaries

Consolidated Statements of Cash Flows

Years Ended December 31, 2022 and 2021

(In millions of Korean won)	Notes		2022			2021
Cash flows from operating activities
Profit for the period			W	2,728,307		W	2,538,029
Adjustment for non-cash items
Net gains on financial instruments at fair value through profit or loss				(35,202	)		(161,792	)
Net losses (gains) on derivative financial instrument for hedging purposes				(28,984	)		13,132
Provision for credit losses				1,121,172			523,010
Net losses (gains) on financial investments				7,069			(12,736	)
Share of profit of associates				(12,666	)		(57,156	)
Depreciation and amortization expense				546,505			537,628
Other net losses (gains) on property and equipment/intangible assets				(37,402	)		18,731
Share-based payment				15,169			27,995
Post-employment benefits				167,049			158,512
Net interest income				140,022			405,793
Losses (gains) on foreign currency translation				403,201			(89,447	)
Other expenses				121,304			45,514
				2,407,237			1,409,184
Changes in operating assets and liabilities
Financial assets at fair value through profit or loss				(1,286,906	)		(1,629,702	)
Derivative financial instrument				171,107			71,935
Loans measured at amortized cost				(12,832,141	)		(32,510,459	)
Current income tax assets				(117,679	)		(4,308	)
Deferred income tax assets				(30,828	)		(90,423	)
Other assets		2,36		(1,260,800	)		447,075
Financial liabilities at fair value through profit or loss				(11,866	)		(34,193	)
Deposits				17,771,160			31,129,121
Deferred income tax liabilities				(74,165	)		165,924
Other liabilities				(1,317,782	)		3,221,530
				1,010,100			766,500
Net cash inflow from operating activities				6,145,644			4,713,713
Cash flows from investing activities
Net cash flows from derivative financial instrument for hedging purposes				(1,774	)		9,575
Disposal of financial assets at fair value through profit or loss				7,165,287			6,019,093
Acquisition of financial assets at fair value through profit or loss				(8,544,547	)		(6,993,541	)
Disposal of financial investments				17,993,936			42,261,739
Acquisition of financial investments				(32,223,758	)		(46,589,385	)
Disposal of investments in associates				47,178			197,396
Acquisition of investments in associates				(272,448	)		(89,644	)
Disposal of property and equipment				13,931			9,050
Acquisition of property and equipment				(188,828	)		(198,681	)
Disposal of investment property				—			1,581
Disposal of intangible assets				245			1,834
Acquisition of intangible assets				(66,475	)		(92,474	)
Net cash flows from changes in ownership of subsidiaries				55,369			80,451
Others				14,657			(23,269	)
Net cash outflow from investing activities				(16,007,227	)		(5,406,275	)
Cash flows from financing activities
Net cash flows from derivative financial instrument for hedging purposes				33,402			5,870
Increase in borrowings				11,575,186			4,743,115
Increase in debentures				21,932,190			20,014,042
Decrease in debentures				(22,129,719	)		(17,598,345	)
Payment of dividends				(1,031,167	)		(917,941	)
Decrease in other payables to trust accounts				(1,225,402	)		(509,106	)
Cash outflow from consolidated equtiy transactions				—			(188,419	)
Issuance of hybrid securities				299,327			—
Others				699,254			(257,954	)
Net cash inflow from financing activities				10,153,071			5,291,262
Effect of exchange rate changes on cash and cash equivalents		2,36		(58,464	)		358,761
Net increase in cash and cash equivalents				233,024			4,957,461
Cash and cash equivalents at the beginning of the period		2,36		23,121,497			18,164,036
Cash and cash equivalents at the end of the period		2,36	W	23,354,521		W	23,121,497

The above consolidated statements of cash flows should be read in conjunction with the accompanying notes.

6

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

1. Reporting Entity

Kookmin Bank (the “Bank”) was incorporated in 1963 under the Citizens National Bank Act to provide banking services to the general public and to small and medium-sized enterprises. Pursuant to the Repeal Act of the Citizens National Bank Act, effective January 5, 1995, the Bank’s status changed to a financial institution which operates under the Banking Act and Commercial Act.

The Bank merged with Korea Long Term Credit Bank on December 31, 1998, and with its subsidiaries, Daegu, Busan, Jeonnam Kookmin Mutual Savings & Finance Co., Ltd., on August 22, 1999. Pursuant to the directive from the Financial Services Commission related to the Structural Improvement of the Financial Industry Act, the Bank acquired certain assets, including performing loans, and assumed most of the liabilities of Daedong Bank on June 29, 1998. Also, the Bank completed the merger with Housing and Commercial Bank (“H&CB”) on October 31, 2001, and merged with Kookmin Credit Card Co., Ltd., a majority-owned subsidiary, on September 30, 2003. Meanwhile, the Bank spun off its credit card business segment on February 28, 2011, and KB Kookmin Card Co., Ltd. became a subsidiary of KB Financial Group Inc.

The Bank listed its shares on the Stock Market Division of the Korea Exchange (“KRX”) in September 1994. As a result of the merger with H&CB, the shareholders of the former Kookmin Bank and H&CB received new common shares of the Bank which were relisted on the KRX on November 9, 2001. In addition, H&CB listed its American Depositary Shares (“ADS”) on the New York Stock Exchange (“NYSE”) on October 3, 2000, prior to the merger. Following the merger with H&CB, the Bank listed its ADS on the NYSE on November 1, 2001. The Bank became a wholly owned subsidiary of KB Financial Group Inc. through a comprehensive stock transfer on September 29, 2008. Subsequently, the Bank’s shares and its ADS, each listed on the KRX and the NYSE, were delisted on October 10, 2008 and September 26, 2008, respectively. As of December 31, 2022, the Bank’s paid-in capital is \ 2,021,896 million.

The Bank engages in the banking business in accordance with the Banking Act, trust business in accordance with the Financial Investment Services and Capital Markets Act, mobile virtual network business in accordance with Special Act on Support for Financial Innovation, and other relevant businesses. As of December 31, 2022, the Bank operates its Seoul headquarters and 856 domestic branches, and nine overseas branches (excluding six subsidiaries and one office).

2. Basis of Preparation

2.1 Application of Korean IFRS

The Bank and its subsidiaries (collectively the “Group”) maintains its accounting records in Korean won and prepares statutory consolidated financial statements in the Korean language in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (“Korean IFRS”). The accompanying consolidated financial statements have been translated into English from the Korean language consolidated financial statements.

The consolidated financial statements of the Group have been prepared in accordance with Korean IFRS. Korean IFRS are the standards and related interpretations issued by the International Accounting Standards Board (“IASB”) that have been adopted by the Republic of Korea.

The preparation of the consolidated financial statements requires the use of certain critical accounting estimates. Management also needs to exercise judgment in applying the Group’s accounting policies. The areas that require a more complex and higher level of judgment or areas that require significant assumptions and estimations are disclosed in Note 2.4.

7

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

2.1.1 The Group has applied the following amended standards for the first time for its annual reporting period commencing January 1, 2022.

- Amendments to Korean IFRS No.1116 Leases - COVID-19-Related Rent Concessions, etc. beyond June 30, 2021

The application of the practical expedient, a lessee may elect not to assess whether a rent concession occurring as a direct consequence of the COVID-19 pandemic is a lease modification, is extended to lease payments originally due on or before 30 June 2022. A lessee shall apply the practical expedient consistently to eligible contracts with similar characteristics and in similar circumstances. These amendments do not have a significant impact on the financial statements.

- Amendments to Korean IFRS No.1103 Business Combination – Reference to the Conceptual Framework

The amendments update a reference of definition of assets and liabilities to qualify for recognition in revised Conceptual Framework for Financial Reporting. However, the amendments add an exception for the recognition of liabilities and contingent liabilities within the scope of Korean IFRS No.1037 Provisions, Contingent Liabilities and Contingent Assets, and Korean IFRS No.2121 Levies. The amendments also confirm that contingent assets should not be recognized at the acquisition date. These amendments do not have a significant impact on the financial statements.

- Amendments to Korean IFRS No.1016 Property, Plant and Equipment—Proceeds Before Intended Use

The amendments prohibit an entity from deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while the entity is preparing the asset for its intended use. Instead, the entity will recognize the proceeds from selling such items, and the costs of producing those items, as profit or loss. These amendments do not have a significant impact on the financial statements.

- Amendments to Korean IFRS No.1037 Provisions, Contingent Liabilities and Contingent Assets—Onerous Contracts: Cost of Fulfilling a Contract

The amendments clarify that the direct costs of fulfilling a contract include both the incremental costs of fulfilling the contract and an allocation of other costs directly related to fulfilling contracts when assessing whether the contract is onerous. These amendments do not have a significant impact on the financial statements.

- Annual improvements to Korean IFRS 2018-2020

These amendments do not have a significant impact on the financial statements.

• Korean IFRS No.1101 First-time Adoption of Korean International Financial Reporting Standards – Subsidiaries that are first-time adopters

• Korean IFRS No.1109 Financial Instruments – Fees related to the 10% test for derecognition of financial liabilities

• Korean IFRS No.1116 Leases – Lease incentives

• Korean IFRS No.1041 Agriculture – Fair value measurement

8

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

2.1.2 The Group has changed the following accounting policy for its annual reporting period commencing January 1, 2022.

The Group classified some restricted demand deposits, such as reserve deposits, as due from financial institutions measured at amortized cost rather than cash and cash equivalents; however, following the International Accounting Standards Interpretation Committee’s decision that cash and cash equivalents include restricted demand deposits, some restricted demand deposits, such as reserve deposits, have been classified as cash and cash equivalents and retroactively applied from January 1, 2022. The comparative consolidated financial statements have been restated to reflect changes made due to retrospectively application

The application of these accounting policy changes has no effect on the consolidated statements of financial position as of December 31, 2022 and 2021, and the consolidated statements of comprehensive income for the years ended December 31, 2022 and 2021.

Effects on the consolidated statements of cash flows for the years ended December 31, 2022 and 2021, are as follows:

2.1.2.1 Increase in details of statement of Cash Flow

(In millions of Korean won)	2022		2021
Increase in other assets		173,382		4,681,486
Increase of exchange rate changes on cash and cash equivalents denominated in foreign currency		87,913		83,083
Increase in beginning balance of cash and cash equivalents		16,124,306		11,359,737
Increase in ending balance of cash and cash equivalents		16,385,601		16,124,306

2.1.2.2 Statement of Cash Flow (2022)

(In millions of Korean won)	Before			After			Increase
Other assets		(1,434,182	)		(1,260,800	)		173,382
Exchange rate changes on cash and cash equivalents denominated in foreign currency		(146,377	)		(58,464	)		87,913
Beginning balance of cash and cash equivalents		6,997,191			23,121,497			16,124,306
Ending balance of cash and cash equivalents		6,968,920			23,354,521			16,385,601

2.1.2.3 Statement of Cash Flow (2021)

(In millions of Korean won)	Before			After		Increase
Other assets		(4,234,411	)		447,075		4,681,486
Exchange rate changes on cash and cash equivalents denominated in foreign currency		275,678			358,761		83,083
Beginning balance of cash and cash equivalents		6,804,299			18,164,036		11,359,737
Ending balance of cash and cash equivalents		6,997,191			23,121,497		16,124,306

9

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

2.1.3 The following new and amended standards have been published that are not mandatory for December 31, 2022 reporting period and have not been adopted by the Group.

- Amendments to Korean IFRS No.1001 Presentation of Financial Statements—Classification of Liabilities as Current or Non-current

The amendments clarify that liabilities are classified as either current or non-current, depending on the substantive rights that exist at the end of the reporting period. Classification is unaffected by the likelihood that an entity will exercise the right to defer settlement of the liability or the management’s expectations thereof. Also, the settlement of liability includes the transfer of the entity’s own equity instruments; however, it would be excluded if an option to settle the liability by the transfer of the entity’s own equity instruments is recognized separately from the liability as an equity component of a compound financial instrument. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

- Issuance of Korean IFRS No.1117 Insurance Contracts

Korean IFRS No.1117 Insurance Contracts will replace Korean IFRS No.1104 Insurance Contracts. This standard requires an entity to estimate future cash flows of an insurance contract and measure insurance liabilities using discount rates applied with assumptions and risks at the measurement date and recognize insurance revenue on an accrual basis including services (insurance coverage) provided to the policyholder by each annual reporting period. In addition, investment components (refunds due to termination and maturity) repaid to a policyholder even if an insured event does not occur, are excluded from insurance revenue, and net insurance income and net investment income are presented separately to enable users of the information to understand the sources of net income. This standard should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted for entities that applied Korean IFRS No.1109 Financial Instruments. The Group is scheduled to apply this standard for annual reporting period beginning on January 1, 2023. The Group does not expect that this new standard has a significant impact on the consolidated financial statements.

- Amendments to Korean IFRS No.1001 Presentation of Financial Statements – Accounting Policy Disclosure

The amendments require an entity to define and disclose their material accounting policy information. IFRS Practice Statement 2 Making Materiality Judgements was amended to explain and demonstrate how to apply the concept of materiality. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

- Amendments to Korean IFRS No.1008 Accounting Policies, Changes in Accounting Estimates and Errors – Definition of Accounting Estimates

The amendments introduce the definition of accounting estimates and clarify how to distinguish changes in accounting estimates from changes in accounting policies. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

10

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

- Amendments to Korean IFRS No.1012 Income Taxes – Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction

The amendments narrow the scope of the deferred tax recognition exemption so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

- Amendments to Korean IFRS No.1001 Presentation of Financial Statements—Disclosure of gains or losses on valuation of financial liabilities subject to exercise price adjustment conditions

The amendments require disclosures about gains or losses on valuation occurred for the reporting period (but are limited to those included in profit or loss) for the conversion options or warrants (or financial liabilities with warrants), if all or part of the financial instrument whose exercise price is adjusted due to the issuers’ stock price fluctuations, are classified as financial liabilities according to paragraph 11 of Korean IFRS No.1032 Financial Instruments: Presentation. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

2.2 Measurement Basis

The consolidated financial statements have been prepared based on the historical cost accounting model unless otherwise specified.

2.3 Functional and Presentation Currency

Items included in the financial statements of each entity of the Group are measured using the currency of the primary economic environment in which the entity operates (“functional currency”). The consolidated financial statements are presented in Korean won, which is the reporting entity’s functional and presentation currency.

2.4 Critical Accounting Estimates

The Group applies accounting policies and uses judgements, accounting estimates, and assumptions that may have a significant impact on the assets (liabilities) and incomes (expenses) in preparing the consolidated financial statements. Management’s estimates of outcomes may differ from actual outcomes if management’s estimates and assumptions based on management’s best judgment are different from the actual environment.

Estimates and underlying assumptions are continually evaluated, and changes in accounting estimates are recognized in the period in which the estimates are changed and in any future periods affected.

Uncertainties in estimates and assumptions with significant risks that may result in material adjustments to the consolidated financial statements are as follows:

11

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

2.4.1 Income taxes

As the income taxes on the Group’s taxable income is calculated by applying the tax laws of various countries and the decisions of tax authorities, there is uncertainty in calculating the final tax effect.

If a certain portion of the taxable income is not used for investments, wages, etc. in accordance with the Korean regulation called ‘Special Taxation for Facilitation of Investment and Mutually-beneficial Cooperation’, the Group is liable to pay additional income tax calculated based on the tax laws. Therefore, the effect of recirculation of corporate income should be reflected in current and deferred income tax. As the Group’s income tax is dependent on the actual investments, wages, etc. per each year, there are uncertainties in measuring the final tax effects during the period when the tax law is applied.

2.4.2 Fair value of financial instruments

The fair value of financial instruments where no active market exists or where quoted prices are not otherwise available is determined by using valuation techniques. Financial instruments, which are not actively traded in the market and those with less transparent market prices, will have less objective fair values and require broad judgment on liquidity, concentration, uncertainty in market factors, assumptions in fair value determination, and other risks.

As described in the significant accounting policies in Note 3.3 Recognition and Measurement of Financial Instruments, diverse valuation techniques are used to determine the fair value of financial instruments, from generally accepted market valuation models to internally developed valuation models that incorporate various types of assumptions and variables

2.4.3 Allowances and provisions for credit losses

The Group recognizes and measures allowances for credit losses of debt instruments measured at amortized cost and debt instruments measured at fair value through other comprehensive income. Also, the Group recognizes and measures provisions for credit losses of acceptances and guarantees, and unused loan commitments. Accuracy of allowances and provisions for credit losses is dependent upon estimation of expected cash flows of the borrower subject to individual assessment of impairment, and upon assumptions and variables of model used in collective assessment of impairment and estimation of provisions for credit losses of acceptances and guarantees, and unused loan commitments.

2.4.4 Net defined benefit asset(liability)

The present value of the net defined benefit asset(liability) is affected by changes in the various factors determined by the actuarial method.

2.4.5 Impairment of goodwill

The recoverable amounts of cash-generating units are determined based on value-in-use calculations to test whether impairment of goodwill has occurred.

.

12

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3. Significant Accounting Policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

3.1 Consolidation

3.1.1 Subsidiaries

Subsidiaries are companies that are controlled by the Group. The Group controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Also, the existence and effects of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls the investee. Subsidiaries are fully consolidated from the date when control is transferred to the Group and de-consolidated from the date when control is lost.

If a subsidiary uses accounting policies other than those adopted in the consolidated financial statements for like transactions and events in similar circumstances, appropriate adjustments are made to that subsidiary’s financial statements in preparing the consolidated financial statements to ensure conformity with the Group’s accounting policies.

Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests, if any. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions (i.e., transactions with owners in their capacity as owners). The difference between fair value of any consideration paid and carrying amount of the subsidiary’s net assets attributable to the additional interests acquired, is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.

When the Group loses control, any investment retained in the former subsidiary is recognized at its fair value at the date when control is lost, with the resulting difference recognized in profit or loss. This fair value will be the fair value on initial recognition of a financial asset in accordance with Korean IFRS No.1109 or, when appropriate, the cost on initial recognition of an investment in an associate or joint venture. In addition, all amounts previously recognized in other comprehensive income in relation to that subsidiary are accounted for on the same basis as would be required if the Group had directly disposed of the related assets or liabilities. Therefore, amounts previously recognized in other comprehensive income are reclassified to profit or loss.

The Group accounts for each business combination by applying the acquisition method. The consideration transferred is measured at fair value, and identifiable assets acquired, and liabilities and contingent liabilities assumed in a business combination are initially measured at acquisition-date fair values. For each business combination, the Group measures non-controlling interests in the acquiree that entitle their holders to a proportionate share of the acquiree’s net assets in the event of liquidation at either (a) fair value or (b) the proportionate share in the recognized amounts of the acquiree’s identifiable net assets. Acquisition-related costs are expensed in the periods in which the costs are incurred.

13

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

In a business combination achieved in stages, the Group shall remeasure its previously held equity interest in the acquiree at its acquisition-date fair value and recognize the resulting gain or loss, if any, in profit or loss or other comprehensive income, as appropriate. In prior reporting periods, the Group may have recognized changes in the value of its equity interest in the acquiree in other comprehensive income. If so, the amount that was recognized in other comprehensive income shall be reclassified as profit or loss, or retained earnings, on the same basis as would be required if the Group had directly disposed of the previously held equity interest.

The Group applies the book-value method to account for business combinations of entities under common control. Identifiable assets acquired and liabilities assumed in a business combination are measured at their book value on the consolidated financial statements of the Group. In addition, the difference between (a) the sum of consolidated net book value of the assets and liabilities transferred and accumulated other comprehensive income and (b) the consideration paid, is recognized as capital surplus.

3.1.2 Associates

Associates are entities over which the Group has significant influence over the financial and operating policy decisions. Generally, if the Group holds 20% or more of the voting power of the investee, it is presumed that the Group has significant influence.

Investments in associates are initially recognized at cost and equity method is applied after initial recognition. The carrying amount is increased or decreased to recognize the Group’s share of the profit or loss of the investee and changes in the investee’s equity after the date of acquisition. Distributions received from an investee reduce the carrying amount of the investment. Unrealized gains and losses resulting from transactions between the Group and associates are eliminated to the extent of the Group’s share in associates. If unrealized losses are an indication of an impairment that requires recognition in the consolidated financial statements, those losses are recognized for the period.

If associates use accounting policies other than those of the Group for like transactions and events in similar circumstances, if necessary, adjustments shall be made to make the associates’ accounting policies conform to those of the Group when the associates’ financial statements are used by the Group in applying the equity method.

If the Group’s share of losses of associates equals or exceeds its interest in the associates (including long-term interests that, in substance, form part of the Group’s net investment in the associates), the Group discontinues recognizing its share of further losses. After the Group’s interest is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associates.

The Group determines at each reporting period whether there is any objective evidence that the investments in the associates are impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associates and its carrying amount and recognizes the amount as non-operating expenses in the consolidated statement of comprehensive income.

3.1.3 Structured entity

A structured entity is an entity that has been designed so that voting or similar rights are not the dominant factor in deciding who controls the entity. When the Group decides whether it has power over the structured entities in which the Group has interests, it considers factors such as the purpose, the form, the substantive ability to direct the relevant activities of a structured entity, the nature of its relationship with a structured entity, and the amount of exposure to variable returns.

14

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.1.4 Funds management

The Group manages and operates trust assets, collective investment, and other funds on behalf of investors. These trusts and funds are not consolidated, except for trusts and funds over which the Group has control.

3.1.5 Intragroup transactions

Intragroup balances, income, expenses, and any unrealized gains and losses resulting from intragroup transactions are eliminated in full, in preparing the consolidated financial statements. If unrealized losses are an indication of an impairment that requires recognition in the consolidated financial statements, those losses are recognized for the period.

3.2 Foreign Currency

3.2.1 Foreign currency transactions

A foreign currency transaction is recorded, at initial recognition in the functional currency, by applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction. At the end of each reporting period, foreign currency monetary items are translated using the closing rate which is the spot exchange rate at the end of the reporting period. Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rate at the date when the fair value was measured and non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

Except for the exchange differences for the net investment in a foreign operation and the financial liability designated as a hedging instrument of net investment, exchange differences arising on the settlement of monetary items or on translating monetary items are recognized in profit or loss. When a gain or loss on a non-monetary item is recognized in other comprehensive income, any exchange component of that gain or loss is recognized in other comprehensive income, conversely, when a gain or loss on a non-monetary item is recognized in profit or loss, any exchange component of that gain or loss is recognized in profit or loss.

3.2.2 Foreign operations

The results and financial position of a foreign operation, whose functional currency differs from the Group’s presentation currency, are translated into the Group’s presentation currency based on the following procedures.

If the functional currency of a foreign operation is not the currency of a hyperinflationary economy, assets and liabilities for each statement of financial position presented (including comparatives) are translated at the closing rate at the end of the reporting period, income and expenses for each statement of comprehensive income presented (including comparatives) are translated using the average exchange rates for the period. All resulting exchange differences are recognized in other comprehensive income.

Any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition of that foreign operation are treated as assets and liabilities of the foreign operation. Thus, they are expressed in the functional currency of the foreign operation and are translated into the presentation currency at the closing rate.

15

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

On the disposal of a foreign operation, the cumulative amount of the exchange differences relating to that foreign operation, recognized in other comprehensive income and accumulated in the separate component of equity, is reclassified from equity to profit or loss (as a reclassification adjustment) when the gain or loss on disposal is recognized. On the partial disposal of a subsidiary that includes a foreign operation, the Group re-attributes the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income to the non-controlling interests in that foreign operation. In any other partial disposal of a foreign operation, the Group reclassifies to profit or loss only the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income.

3.2.3 Translation of the net investment in a foreign operation

A monetary item that is receivable from or payable to a foreign operation, for which settlement is neither planned nor likely to occur in the foreseeable future is, in substance, a part of the Group’s net investment in that foreign operation, then foreign currency difference arising from that monetary item is recognized in the other comprehensive income and shall be reclassified to profit or loss on disposal of the net investment.

3.3 Recognition and Measurement of Financial Instruments

3.3.1 Initial recognition

The Group recognizes a financial asset or a financial liability in its consolidated statement of financial position when the Group becomes party to the contractual provisions of the instrument. A regular way purchase or sale of financial assets (a purchase or sale of a financial asset under a contract whose terms require delivery of the asset within the time frame established generally by regulation or convention in the marketplace concerned) is recognized and derecognized using trade date accounting.

For financial reporting purpose, the Group classifies (a) financial assets as financial assets at fair value through profit or loss, financial assets at fair value through other comprehensive income, or financial assets at amortized cost and (b) financial liabilities as financial liabilities at fair value through profit or loss, or other financial liabilities. These classifications are based on the business model for managing financial instruments and the contractual cash flow characteristics of the financial instrument at initial recognition.

At initial recognition, a financial asset or financial liability is measured at its fair value plus or minus, in the case of a financial asset or financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability. The fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The fair value of a financial instrument on initial recognition is normally the transaction price (that is, the fair value of the consideration given or received) in an arm’s length transaction.

3.3.2 Subsequent measurement

After initial recognition, financial instruments are measured at amortized cost or fair value based on classification at initial recognition.

3.3.2.1 Amortized cost

The amortized cost of a financial asset or financial liability is the amount at which the financial asset or financial liability is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between that initial amount and the maturity amount and, for financial assets, adjusted for any loss allowance.

16

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.3.2.2 Fair value

The Group uses quoted price in an active market which is based on listed market price or dealer price quotations of financial instruments traded in an active market as best estimate of fair value. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis.

If there is no active market for a financial instrument, fair value is determined either by using a valuation technique or independent third-party valuation service. Valuation techniques include using recent arm’s length market transactions between knowledgeable and willing parties, if available, referencing the current fair value of another instrument that is substantially the same, discounted cash flow analysis, and option pricing models.

The Group uses valuation models that are commonly used by market participants and customized for the Group to determine fair values of common over-the-counter (“OTC”) derivatives such as options, interest rate swaps, and currency swaps which are based on the inputs observable in markets. However, for some complex financial instruments that require fair value measurement by valuation techniques based on certain assumptions because some or all inputs used in the model are not observable in the market, the Group uses internal valuation models developed from general valuation models or valuation results from independent external valuation institutions.

In addition, the fair value information recognized in the consolidated statement of financial position is classified into the following fair value hierarchy, reflecting the significance of the input variables used in the fair value measurement.

Level 1 : Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Group can access at the measurement date

Level 2 : Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly

Level 3 : Unobservable inputs for the asset or liability

The fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety.

If a fair value measurement uses observable inputs that require significant adjustment using unobservable inputs, that measurement is a Level 3 measurement.

The Group’s Fair Value Evaluation Committee, which consists of the risk management department, trading department and accounting department, reviews the appropriateness of internally developed valuation models, and approves the selection and changing of the external valuation institution and other considerations related to fair value measurement. The results of regular verification of the internally developed valuation models are reported to the Market Risk Management Subcommittee.

If the valuation technique does not reflect all factors which market participants would consider in pricing the asset or liability, the fair value is adjusted to reflect those factors. Those factors include counterparty credit risk, liquidity risk, and others.

The Group uses valuation technique which maximizes the use of market inputs and minimizes the use of entity-specific inputs. It incorporates all factors that market participants would consider in pricing the asset or liability and is consistent with economic methodologies applied for pricing financial instruments. Periodically, the Group calibrates the valuation technique and tests its validity using prices of observable current market transactions of the same instrument or based on other relevant observable market data.

17

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.3.3 Derecognition

Derecognition is the removal of a previously recognized financial asset or financial liability from the consolidated statement of financial position. The derecognition criteria for financial assets and financial liabilities are as follows:

3.3.3.1 Derecognition of financial assets

A financial asset is derecognized when the contractual rights to the cash flows from the financial assets expire or the Group transfers substantially all the risks and rewards of ownership of the financial asset, or the Group neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset and the Group has not retained control. Therefore, if the Group does not transfer substantially all the risks and rewards of ownership of the financial asset, the Group continues to recognize the financial asset to the extent of its continuing involvement in the financial asset.

If the Group transfers the contractual rights to receive the cash flows of the financial asset but retains substantially all the risks and rewards of ownership of the financial asset, the Group continues to recognize the transferred asset in its entirety and recognize a financial liability for the consideration received.

The Group writes off a financial asset when the Group has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. In general, the Group considers write-off when it is determined that the debtor does not have sufficient funds or income to cover the principal and interest. The write-off decision is made in accordance with internal regulations. After the write-off, the Group can continue to collect the written-off loans according to the internal policy. Recovered amounts from financial assets previously written-off are recognized in profit or loss.

3.3.3.2 Derecognition of financial liabilities

A financial liability is derecognized from the consolidated statement of financial position when it is extinguished (i.e., the obligation specified in the contract is discharged, canceled or expires).

3.3.4 Offsetting

A financial asset and a financial liability are offset, and the net amount is presented in the consolidated statement of financial position when, and only when, the Group currently has a legally enforceable right to set off the recognized amounts and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on a future event and must be legally enforceable in the normal course of business, the event of default, and the event of insolvency or bankruptcy of the Group and all of the counterparties.

18

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.4 Cash and Due from Financial Institutions

Cash and due from financial institutions include cash on hand, foreign currency, and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and due from financial institutions. Cash and due from financial institutions are measured at amortized cost.

3.5 Non-derivative Financial Assets

3.5.1 Financial assets at fair value through profit or loss

Financial assets are classified as financial assets at fair value through profit or loss unless they are classified as financial assets at amortized cost or at fair value through other comprehensive income.

The Group may designate certain financial assets upon initial recognition as at fair value through profit or loss when the designation eliminates or significantly reduces a measurement or recognition inconsistency (sometimes referred to as an ‘accounting mismatch’) that would otherwise arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases.

After initial recognition, a financial asset at fair value through profit or loss is measured at fair value and gains or losses arising from a change in fair value are recognized in profit or loss. Interest income using the effective interest method and dividend income from financial assets at fair value through profit or loss are also recognized in profit or loss.

3.5.2 Financial assets at fair value through other comprehensive income

The Group classifies below financial assets as financial assets at fair value through other comprehensive income:

• Debt instruments that are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and where the assets’ cash flows represent solely payments of principal and interest on the principal amount outstanding and;

• Equity instruments that are not held for short-term trading but held for strategic investment, and designated as financial assets at fair value through other comprehensive income

After initial recognition, a financial asset at fair value through other comprehensive income is measured at fair value. Gains or losses arising from a change in fair value, other than dividend income, interest income calculated using the effective interest method and exchange differences arising on monetary items which are recognized directly in profit or loss, are recognized in other comprehensive income in equity.

When the financial assets at fair value through other comprehensive income is disposed of, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss. However, cumulative gain or loss of equity instruments designated at fair value through other comprehensive income is reclassified to retained earnings not to profit or loss at disposal.

A financial asset at fair value through other comprehensive income denominated in foreign currency is translated at the closing rate. Exchange differences resulting from changes in amortized cost are recognized in profit or loss, and other changes are recognized in equity.

19

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.5.3 Financial assets at amortized cost

A financial asset, which is held within the business model whose objective is achieved by collecting contractual cash flows, and where the assets’ cash flows represent solely payments of principal and interest on the principal amount outstanding, is classified as a financial asset at amortized cost. After initial recognition, a financial asset at amortized cost is measured at amortized cost using the effective interest method and interest income is calculated using the effective interest method.

3.6 Expected Credit Losses of Financial Assets (Debt Instruments)

The Group recognizes loss allowances for expected credit losses at the end of the reporting period for financial assets at amortized cost and fair value through other comprehensive income except for financial assets at fair value through profit or loss.

Expected credit losses are estimated at present value of probability-weighted amount that is determined by evaluating a range of possible outcomes. The Group measures expected credit losses by reflecting all reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions, and forecasts of future economic conditions.

The approaches of measuring expected credit losses in accordance with Korean IFRS are as follows:

• General approach: for financial assets and unused loan commitments not subject to the below approach

• Credit-impaired approach: for financial assets that are credit-impaired at the time of acquisition

Application of general approach is differentiated depending on whether credit risk has increased significantly after initial recognition. If the credit risk on a financial instrument has not increased significantly since initial recognition, the Group measures loss allowances for that financial instrument at an amount equal to 12-month expected credit losses, whereas if the credit risk on a financial instrument has increased significantly since initial recognition, the Group measures loss allowances for a financial instrument at an amount equal to the lifetime expected credit losses. Lifetime is the period until the contractual maturity date of financial instruments and means the expected life.

The Group assesses whether the credit risk has increased significantly using the following criteria, and if one or more of the following criteria are met, it is deemed as significant increase in credit risk. Criterion of more than 30 days past due is applied to all subsidiaries, and other criteria are applied selectively considering specific indicators of each subsidiary or additionally considering specific indicators of each subsidiary. If the contractual cash flows of a financial asset have been renegotiated or modified, the Group assesses whether the credit risk has increased significantly using the same following criteria.

• More than 30 days past due

• Decline in credit rating at the end of the reporting period by certain notches or more compared to the time of initial recognition

• Subsequent managing ratings below certain level in the early warning system

• Debt restructuring (except for impaired financial assets) and

• Credit delinquency information of Korea Federation of Banks, etc.

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Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

The Group generally considers the loan to be credit-impaired if one or more of the following criteria are met:

• 90 days or more past due

• Legal proceedings related to collection

• A borrower registered on the credit management list of Korea Federation of Banks

• A corporate borrower with the credit rating C and D

• Refinancing and

• Debt restructuring

3.6.1 Forward-looking information

The Group uses forward-looking information, when determining whether credit risk has increased significantly and measuring expected credit losses.

The Group assumes that the risk components have a constant correlation with the economic cycle and uses statistical methodologies to estimate the relation between key macroeconomic variables and risk components for the expected credit losses. The Group has derived a correlation between the time series data of 13 years or more and the key macroeconomic variables and calculates the expected credit losses by reflecting the results of the correlation on the risk component.

The correlation between the major macroeconomic variables and the credit risk are as follows:

Key macroeconomic variables	Correlation between the major macroeconomic variables and the credit risk
Domestic GDP growth rate	(-)
Composite stock index	(-)
Growth rate of construction investment	(-)
Rate of increase in housing transaction price index	(-)
Interest rate spread	(+)
Private consumption growth rate	(-)

Forward-looking information used in calculation of expected credit losses is based on the macroeconomic forecasts utilized by management of the Group for its business plan considering reliable external agency’s forecasts and others. The forward-looking information is generated by KB Research with a comprehensive approach to capture the possibility of various economic forecast scenarios that are derived from the internal and external viewpoints of the macroeconomic situation. The Group determines the macroeconomic variables to be used in forecasting future conditions of the economy, considering the direction of the forecast scenario and the significant relationship between macroeconomic variables and time series data. And there are some changes compared to the macroeconomic variables used in the previous year.

As of December 31, 2022, the Bank measures expected credit losses by applying both the worse scenario and the crisis scenario, taking into consideration the potential credit risk resulting from the uncertain financial environment locally and globally and the rapid economic recession.

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Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.6.2 Measuring expected credit losses on financial assets at amortized cost

The expected credit losses of financial assets at amortized cost are measured as present value of the difference between the contractual cash flows to be received and the cash flows expected to be received. The Group estimates expected future cash flows for financial assets that are individually significant. The Group selects the individually significant financial assets by comprehensively considering quantitative and qualitative factors (such as debt restructuring or negative net assets, etc.) among financial assets with the credit risk has increased significantly or credit-impaired (individual assessment of impairment).

For financial assets that are not individually significant, the Group collectively estimates expected credit losses by grouping loans with a homogeneous credit risk profile (collective assessment of impairment).

3.6.2.1 Individual assessment of impairment

Individual assessment of impairment losses is performed using management’s best estimate on the present value of expected future cash flows. The Group uses all the available information including financial condition of the borrower such as operating cash flow and net realizable value of any collateral held.

3.6.2.2 Collective assessment of impairment

Collective assessment of impairment losses is performed by using a methodology based on historical loss experience and reflecting forward-looking information. Such a process incorporates factors such as type of collateral, type of product, type of borrower, credit rating, size of portfolio, and recovery period and applies Probability of Default (“PD”) on a group of assets and Loss Given Default (“LGD”) by type of recovery method. Also, the Group applies certain assumptions to model expected credit losses assessment and to determine input based on loss experience and forward-looking information. These models and assumptions are periodically reviewed to reduce the gap between loss estimate and actual loss experience.

The lifetime expected credit losses are measured by applying the PD to the carrying amount calculated by deducting the expected principal repayment amount from the carrying amount as of the reporting date and the LGD adjusted to reflect changes in the carrying amount.

3.6.3 Measuring expected credit losses on financial assets at fair value through other comprehensive income

The Group measures expected credit losses on financial assets at fair value through other comprehensive income in a manner that is consistent with the requirements that are applicable to financial assets at amortized cost. However, loss allowances are recognized in other comprehensive income. Upon disposal or repayment of financial assets at fair value through other comprehensive income, the amount of loss allowances is reclassified from other comprehensive income to profit or loss.

3.7 Derivative Financial Instruments

The Group enters into numerous derivative financial instrument contracts such as currency forwards, interest rate swaps, currency swaps, and others for trading purposes or to manage its interest rate risk, currency risk, and others. The Group’s derivative financial instruments business focuses on addressing the needs of the Group’s corporate clients to hedge their risk exposure and to hedge the Group’s risk exposure that results from such client contracts. These derivative financial instruments are presented as derivative financial instruments in the consolidated financial statements irrespective of transaction purpose and subsequent measurement requirement.

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Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

The Group designates certain derivative financial instruments as hedging instruments to hedge the risk of changes in fair value of a recognized asset or liability or of an unrecognized firm commitment (fair value hedge) and the risk of changes in cash flow (cash flow hedge). The Group designates certain derivative and non-derivative financial instruments as hedging instruments to hedge the currency risk of the net investment in a foreign operation (hedge of net investment).

At the inception of the hedging relationship, there is formal designation and documentation of the hedging relationship and the Group’s risk management objective and strategy for undertaking the hedge. This documentation includes identification of the hedging instrument, the hedged item, the nature of the risk being hedged, the inception date of hedging relationship and how the Group will assess the hedging instrument’s effectiveness in offsetting the changes in the hedged item’s fair value or cash flows attributable to the hedged risk.

Derivative financial instruments are initially recognized at fair value. After initial recognition, derivative financial instruments are measured at fair value, and changes therein are accounted for as described below.

3.7.1 Derivative financial instruments held for trading

All derivative financial instruments, except for derivatives that are designated and qualify for hedge accounting, are measured at fair value. Gains or losses arising from changes in fair value are recognized in profit or loss as part of net gains or losses on financial instruments at fair value through profit or loss.

3.7.2 Derivative financial instruments for fair value hedges

If derivative financial instruments are designated and qualify for fair value hedges, changes in fair value of the hedging instrument and changes in fair value of the hedged item attributable to the hedged risk are recognized in profit or loss as part of other operating income or expenses. If the hedged items are equity instruments for which the Group has elected to present changes in fair value in other comprehensive income, changes in fair value of the hedging instrument and changes in fair value of the hedged item attributable to the hedged risk are recognized in other comprehensive income.

Fair value hedge accounting is discontinued prospectively if the hedging instrument expires or is sold, terminated or exercised, or the hedging relationship ceases to meet the qualifying criteria. Once fair value hedge accounting is discontinued, the adjustment to the carrying amount of a hedged item is amortized to profit or loss by the maturity of the financial instrument using the effective interest method.

3.7.3 Derivative financial instruments for cash flow hedges

The effective portion of changes in fair value of derivative financial instruments that are designated and qualify for cash flow hedges is recognized in other comprehensive income, limited to the cumulative change in fair value (present value) of the hedged item (the present value of the cumulative change in the hedged expected future cash flows) from inception of the hedge. The ineffective portion is recognized in profit or loss as other operating income or expenses. The associated gains or losses that were previously recognized in other comprehensive income are reclassified from equity to profit or loss (other operating income or expenses) as a reclassification adjustment in the same period or periods during which the hedged forecast cash flows affect profit or loss. Cash flow hedge accounting is discontinued prospectively if the hedging instrument expires or is sold, terminated or exercised, or the hedging relationship ceases to meet the qualifying criteria. When the cash flow hedge accounting is discontinued, the cumulative gains or losses on the hedging instrument that have been recognized in other comprehensive income are reclassified to profit or loss over the period in which the forecast transaction occurs. If the forecast transaction is no longer expected to occur, the cumulative gains or losses that have been recognized in other comprehensive income are immediately reclassified to profit or loss.

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Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.7.4 Derivative and non-derivative financial instruments designated for net investments hedges

If derivative and non-derivative financial instruments are designated and qualify for the net investment hedge, the effective portion of changes in fair value of the hedging instrument is recognized in other comprehensive income and the ineffective portion is recognized in profit or loss as other operating income or expenses. The cumulative gains or losses on the hedging instrument relating to the effective portion of the hedge that have been accumulated in other comprehensive income will be reclassified from other comprehensive income to profit or loss as a reclassification adjustment on the disposal or partial disposal of the foreign operation.

3.7.5 Risk management strategy

Interest rate risk arises from changes in fair value resulting from changes in the discount rate of fixed rate financial instruments, and changes in cash flows resulting from changes in the nominal interest rate of floating rate financial instruments. Foreign currency risk arises from the net investment in a foreign operation, whose functional currency differs from the Group’s functional currency.

While the Group hedges the interest rate risk in its entirety, the Group hedges the foreign currency risk only the proportional part of the notional amount.

At inception of the hedge relationship, the Group reviews the hedge effectiveness; and periodically reviews the effectiveness in order to confirm that economic relationship between the hedged item and the hedging instrument exists. The requirement that an economic relationship exists means that the hedging instrument and the hedged item have values that generally move in the opposite direction due to the same risk, which is the hedged risk. The Group designates the exposure of hedged item opposite to the exposure of hedging instruments in order to meet economic relationship requirement.

The Group designates hedge relationship at one-on-one ratio between the nominal amount of hedging instrument and to the nominal amount of hedged item.

Hedge ineffectiveness could arise because of differences in the underlying parameters (acquisition date, credit risk or liquidity and others) or other differences between the hedging instrument and the hedged item that the Group accepts in order to achieve a cost-effective hedging relationship.

The Group avoids the cash flow variability of its floating rate debt securities by using interest rate swaps. Both are linked to the same interest rate; however, the paid amount of the floating rate may be set on different dates. Even if the variability of interest rate related cash flows (as a risk factor) is designated as a hedged item, the difference in set-up dates creates a hedge ineffectiveness.

The Group avoids the variability of fair values of its fixed rate debt securities by using interest rate swaps. The calculating method of the number of the dates for paying fixed-rate interest amount can be different between hedging instruments and hedged items. Even if the variability of the fair value due to the benchmark interest rate (as a risk factor) are designated as a hedged item, the difference in calculating method of the number of the dates creates a hedge ineffectiveness.

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Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.7.6 Embedded derivatives

An embedded derivative is separated from the host contract and accounted for as a derivative if, and only if, (a) the economic characteristics and risks of the embedded derivative are not closely related to those of the host contract, (b) a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative and (c) the hybrid contract contains a host that is not a financial asset and is not designated as at fair value through profit or loss. Gains or losses arising from a change in fair value of an embedded derivative separated from the host contract are recognized in profit or loss as part of net gains or losses on financial instruments at fair value through profit or loss.

3.7.7 Day one gains or losses

If the Group uses a valuation technique that incorporates unobservable inputs for the fair value of the OTC derivatives at initial recognition, there may be a difference between the transaction price and the amount determined using that valuation technique. In these circumstances, the difference is not recognized in profit or loss but deferred and amortized using the straight-line method over the life of the financial instrument. If the fair value is subsequently determined using observable inputs, the remaining deferred amount is recognized in profit or loss as part of net gains or losses on financial instruments at fair value through profit or loss or other operating income or expenses.

3.8 Property and Equipment

3.8.1 Recognition and measurement

Property and equipment that qualify for recognition as an asset are measured at cost and subsequently carried at its cost less any accumulated depreciation and any accumulated impairment losses.

The cost of property and equipment includes any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management and the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

Subsequent expenditures are capitalized only when they prolong the useful life or enhance values of the assets but the costs of the day-to-day servicing of the assets such as repair and maintenance costs are recognized in profit or loss as incurred. When part of an item of property and equipment has a useful life different from that of the entire asset, it is recognized as a separate asset.

3.8.2 Depreciation

Land is not depreciated, whereas other property and equipment are depreciated using the method that reflects the pattern in which the asset’s future economic benefits are expected to be consumed by the Group. The depreciable amount of an asset is determined after deducting its residual value.

Each part of an item of property and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately.

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Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

The depreciation method and estimated useful life of property and equipment are as follows:

Property and equipment	Depreciation method	Estimated useful life
Buildings	Straight-line	20 ~ 40 years
Leasehold improvements	Diminishing-balance	4 years
Equipment and vehicles	Diminishing-balance	4 years

The residual value, the useful life, and the depreciation method applied to an asset are reviewed at each financial year-end and, if expectations differ from previous estimates, the changes are accounted for as a change in an accounting estimate.

3.9 Investment Properties

3.9.1 Recognition and measurement

Properties held to earn rentals or for capital appreciation or both are classified as investment properties. Investment properties are measured initially at their cost and subsequently the cost model is used.

3.9.2 Depreciation

Land is not depreciated, whereas other investment properties are depreciated using the method that reflects the pattern in which the asset’s future economic benefits are expected to be consumed by the Group. The depreciable amount of an asset is determined after deducting its residual value.

The depreciation method and estimated useful life of investment properties are as follows:

Investment properties	Depreciation method	Estimated useful life
Buildings	Straight-line	40 years

The residual value, the useful life, and the depreciation method applied to an asset are reviewed at each financial year-end and, if expectations differ from previous estimates, the changes are accounted for as a change in an accounting estimate.

3.10 Intangible Assets

Intangible assets are measured initially at cost and subsequently carried at their cost less any accumulated amortization and any accumulated impairment losses.

Intangible assets, except for goodwill and membership rights, are amortized using the straight-line or declining-balance method with no residual value over their estimated useful life since the assets are available for use.

Intangible assets	Amortization method	Estimated useful life
Industrial property rights	Straight-line	5 years
Software	Straight-line	4 ~ 5 years
Others	Straight-line / Declining-balance	1 ~ 13 years

The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at each financial year-end. Where an intangible asset is not being amortized because its useful life is indefinite, the Group carries out a review in each accounting period to confirm whether events and circumstances still support an indefinite useful life assessment. If they do not, the change in the useful life assessment from indefinite to finite is accounted for as a change in an accounting estimate.

26

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.10.1 Goodwill

3.10.1.1 Recognition and measurement

Goodwill related to business combinations before January 1, 2010, is stated at its carrying amount, which was recognized under the Group’s previous accounting policy, prior to the transition to Korean IFRS.

Goodwill acquired from business combinations after January 1, 2010, is initially measured as the excess of the consideration transferred over the fair value of net identifiable assets acquired and liabilities assumed. If the fair value of net identifiable assets acquired and liabilities assumed exceeds the consideration transferred, the difference is recognized in profit or loss.

For each business combination, the Group decides at the acquisition date whether the non-controlling interests in the acquiree are initially measured at fair value or at the non-controlling interests’ proportionate share in the recognized amounts of the acquiree’s identifiable net assets.

Acquisition-related costs incurred to effect a business combination are charged to expenses in the periods in which the costs are incurred and the services are received, except for the costs to issue debt or equity securities.

3.10.1.2 Additional acquisitions of non-controlling interests

Additional acquisitions of non-controlling interests are accounted for as equity transactions. Therefore, no additional goodwill is recognized.

3.10.1.3 Subsequent measurement

Goodwill is not amortized and is stated at cost less accumulated impairment losses. However, goodwill that forms part of the carrying amount of an investment in associates is not separately recognized and an impairment loss recognized is not allocated to any asset, including goodwill, which forms part of the carrying amount of the investment in the associates.

3.10.2 Subsequent expenditures

Subsequent expenditures are capitalized only when they enhance values of the assets. Internally generated intangible assets, such as goodwill and trade name, are not recognized as assets but expensed as incurred.

3.11 Impairment of Non-financial Assets

The Group assesses at the end of each reporting period whether there is any indication that a non-financial asset, except for (a) deferred income tax assets, (b) assets arising from employee benefits and (c) non-current assets (or group of assets to be sold) classified as held for sale, may be impaired. If any such indication exists, the Group estimates the recoverable amount of the asset. However, irrespective of whether there is any indication of impairment, the Group tests (a) goodwill acquired in a business combination, (b) intangible assets with an indefinite useful life and (c) intangible assets not yet available for use for impairment annually by comparing their carrying amount with their recoverable amount.

27

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

The recoverable amount is estimated for the individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the Group determines the recoverable amount of the cash-generating unit to which the asset belongs. A cash-generating unit is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. The recoverable amount of an asset is the higher of its fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from an asset or cash-generating unit that are discounted by a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the future cash flow estimates have not been adjusted.

If the recoverable amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. That reduction is an impairment loss and recognized immediately in profit or loss. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units that is expected to benefit from the synergies of the combination. The impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the cash-generating unit and then to the other assets of the unit pro rata on the basis of the carrying amount of each asset in the unit.

An impairment loss recognized for goodwill is not reversed in a subsequent period. The Group assesses at the end of each reporting period whether there is any indication that an impairment loss recognized in prior periods for an asset, other than goodwill, may no longer exist or may have decreased, and an impairment loss recognized in prior periods for an asset other than goodwill shall be reversed if, and only if, there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized. The increased carrying amount of an asset other than goodwill attributable to a reversal of an impairment loss cannot exceed the carrying amount that would have been determined (net of amortization or depreciation) had no impairment loss been recognized for the asset in prior years.

3.12 Non-current Assets Held for Sale

A non-current asset or disposal group is classified as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use. For this to be the case, the asset (or disposal group) must be available for immediate sale in its present condition and its sale must be highly probable. A non-current asset (or disposal group) classified as held for sale is measured at the lower of (a) its carrying amount measured in accordance with the applicable Korean IFRS, immediately before the initial classification of the asset (or disposal group) as held for sale and (b) fair value less costs to sell.

A non-current asset while it is classified as held for sale or while it is part of a disposal group classified as held for sale is not depreciated (or amortized).

Impairment loss is recognized for any initial or subsequent write-down of the asset (or disposal group) to fair value less costs to sell. Gain is recognized for any subsequent increase in fair value less costs to sell of an asset, but not in excess of the cumulative impairment loss that has been recognized.

3.13 Financial Liabilities

The Group classifies financial liabilities into financial liabilities at fair value through profit or loss or other financial liabilities in accordance with the substance of the contractual arrangement and the definitions of financial liabilities. The Group recognizes financial liabilities in the consolidated statement of financial position when the Group becomes a party to the contractual provisions of the financial liability.

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Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.13.1 Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading or designated as such at initial recognition. After initial recognition, financial liabilities at fair value through profit or loss are measured at fair value, and changes therein are recognized in profit or loss. At initial recognition, transaction costs that are directly attributable to the acquisition are recognized in profit or loss as incurred.

In relation to securities lending or borrowing transactions, when the Group borrows securities from the Korea Securities Depository and others, these transactions are managed as off-balance sheet items. The borrowed securities are treated as financial liabilities at fair value through profit or loss when they are sold. Changes in fair value at the end of the reporting period and difference between carrying amount at redemption and purchased amount are recognized in profit or loss.

3.13.2 Other financial liabilities

Non-derivative financial liabilities other than financial liabilities at fair value through profit or loss are classified as other financial liabilities. Other financial liabilities include deposits, borrowings, debentures, and others. At initial recognition, other financial liabilities are measured at fair value minus transaction costs that are directly attributable to the acquisition. After initial recognition, other financial liabilities are measured at amortized cost, and its interest expense is recognized, using the effective interest method.

When an asset is sold under repurchase agreement, the Group continues to recognize the asset with the amount sold being accounted for as borrowings. The Group derecognizes a financial liability from the consolidated statement of financial position only when it is extinguished (i.e., when the obligation specified in the contract is discharged, canceled or expires).

3.14 Provisions

Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Inevitable risks and uncertainties surrounding related events and circumstances are considered in measuring the best estimate of the provisions, and where the effect of the time value of money is material, the amount of provisions is the present value of the expenditures expected to be required to settle the obligation.

Provisions for confirmed and unconfirmed acceptances and guarantees, and unused credit lines of consumer and corporate loans are recognized using a valuation model that applies the credit conversion factor, PD, and LGD.

Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of resources embodying economic benefits will be required to settle the obligation, the provisions are reversed.

An onerous contract is a contract in which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfill it. If the Group has a contract that is onerous, the present obligation under the contract is recognized and measured as provisions.

29

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.15 Financial Guarantee Contracts

Financial guarantee contracts require the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due in accordance with the original or modified terms of a debt instrument.

Financial guarantee contracts are initially recognized at fair value and classified as other liabilities and are amortized over the contractual term. After initial recognition, financial guarantee contracts are measured at the higher of:

• The amount determined in accordance with Korean IFRS No.1109 Financial Instruments and

• The amount initially recognized less, when appropriate, the cumulative amount of income recognized in accordance with Korean IFRS No.1115 Revenue from Contracts with Customers.

3.16 Equity Instrument Issued by the Group

An equity instrument is any contract or agreement that evidences a residual interest in the assets of an entity after deducting all of its liabilities.

3.16.1 Ordinary shares

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or the exercise of stock option are deducted from the equity, net of any tax effects.

3.16.2 Hybrid securities

The financial instruments can be classified as either financial liabilities or equity in accordance with the terms of the contract. The Group classifies hybrid securities as an equity if the Group has the unconditional right to avoid any contractual obligation to deliver cash or another financial asset in relation to the financial instruments. However, hybrid securities issued by subsidiaries are classified as non-controlling interests, dividends are recognized in the consolidated statement of comprehensive income as profit attributable to non-controlling interests.

3.16.3 Compound financial instruments

A compound financial instrument is classified as a financial liability or an equity instrument depending on the substance of the contractual arrangement of such financial instrument. The liability component of the compound financial instrument is measured at fair value of the similar liability without conversion option at initial recognition and subsequently measured at amortized cost using effective interest method until it is extinguished by conversion or matured. Equity component is initially measured at fair value of compound financial instrument in its entirety less fair value of liability component net of tax effect, and it is not remeasured subsequently.

30

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.17 Revenue Recognition

The Group recognizes revenues in accordance with the following steps determined in accordance with Korean IFRS No.1115 Revenue from Contracts with Customers.

• Step 1: Identify the contract with a customer.

• Step 2: Identify the performance obligations in the contract.

• Step 3: Determine the transaction price.

• Step 4: Allocate the transaction price to the performance obligations in the contract.

• Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

3.17.1 Interest income and expense

Interest income and expense on debt securities at fair value through profit or loss (excluding beneficiary certificates, equity investments, and other debt instruments), loans, financial instruments at amortized cost, and debt securities at fair value through other comprehensive income are recognized in the consolidated statement of comprehensive income using the effective interest method in accordance with Korean IFRS No.1109 Financial Instruments. The effective interest method is a method of calculating the amortized cost of a financial asset or a financial liability and allocating the interest income or interest expense over the relevant period.

The effective interest rate is the rate that exactly discounts estimated future cash receipts or payments through the expected life of the financial instrument or, where appropriate, a shorter period, to the gross carrying amount of a financial asset or to the amortized cost of a financial liability. When calculating the effective interest rate, the Group estimates expected cash flows by considering all contractual terms of the financial instrument but does not consider expected credit losses. The calculation includes all fees and points paid (main components of effective interest rate only) or received between parties to the contract that are an integral part of the effective interest rate, transaction costs, and all other premiums or discounts. In those rare cases when it is not possible to reliably estimate the cash flows and the expected life of a financial instrument, the Group uses the contractual cash flows over the full contractual term of the financial instrument.

Interest income on impaired financial assets is recognized using the interest rate used to discount the expected cash flows for the purpose of measuring the impairment loss. Interest income on debt securities at fair value through profit or loss is also classified as interest income in the consolidated statement of comprehensive income.

3.17.2 Fee and commission income

The Group recognizes financial service fees in accordance with the purpose of charging the fees and the accounting standards of the financial instrument related to the fees earned.

3.17.2.1 Fees that are an integral part of the effective interest of a financial instrument

Such fees are generally treated as adjustments of effective interest rate. Such fees may include compensation for activities such as evaluating the borrower’s financial condition, evaluating and recording guarantees, collateral and other security arrangements, negotiating the terms of the instrument, preparing and processing documents, and closing the transaction and origination fees received on issuing financial liabilities at amortized cost. However, fees relating to the creation or acquisition of a financial instrument at fair value through profit or loss are recognized as revenue immediately.

31

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.17.2.2 Fees related to performance obligations satisfied over time

If the control of a good or service is transferred over time, the Group recognizes revenue related to performance obligations over the period of performance obligations. Fees charged in return for the services for a certain period of time, such as asset management fees, consignment business fees, etc. are recognized over the period of performance obligations.

3.17.2.3 Fees related to performance obligations satisfied at a point in time

Fees earned at a point in time are recognized as revenue when a customer obtains controls of a promised good or service and the Group satisfies a performance obligation.

Commission on negotiation or participation in negotiation for the third party such as trading stocks or other securities, arranging merger and acquisition of business, is recognized as revenue when the transaction has been completed.

If the Group arranges a syndicated loan but does not participate in the syndicated loan or participates in the syndicated loan with the same effective profit as other participants, a syndication arrangement fee is recognized as revenue at the completion of the syndication service.

3.17.3 Net gains or losses on financial instruments at fair value through profit or loss

Net gains or losses on financial instruments at fair value through profit or loss (including changes in fair value, dividends, and gains or losses from foreign currency translation) include gains or losses on financial instruments as follows:

• Gains or losses relating to financial instruments at fair value through profit or loss (excluding interest income using the effective interest rate method)

• Gains or losses relating to derivative financial instruments for trading (including derivative financial instruments for hedging purpose but do not qualify for hedge accounting)

3.17.4 Dividend income

Dividend income is recognized in profit or loss when the right to receive payment is established. Dividend income is recognized as net gains or losses on financial instruments at fair value through profit or loss or other operating income depending on the classification of equity securities.

3.18 Employee Compensation and Benefits

3.18.1 Post-employment benefits

3.18.1.1 Defined contribution plans

When an employee has rendered service to the Group during a period, the Group recognizes the contribution payable to a defined contribution plan in exchange for that service as post-employment benefits for the period.

32

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.18.1.2 Defined benefit plans

All post-employment benefits, other than defined contribution plans, are classified as defined benefit plans. The amount recognized as a net defined benefit liability is the present value of the defined benefit obligation less the fair value of plan assets at the end of the reporting period.

The present value of the defined benefit obligation is calculated annually by a qualified actuary using the projected unit credit method. The rate used to discount post-employment benefit obligations is determined by reference to market yields at the end of the reporting period on high quality corporate bonds. The currency and term of the corporate bonds are consistent with the currency and estimated term of the post-employment benefit obligations. Actuarial gains and losses resulted from changes in actuarial assumptions and experience adjustments are recognized in other comprehensive income.

When the present value of the defined benefit obligation minus the fair value of plan assets results in an asset, it is recognized to the extent of the present value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan.

Past service cost is the change in the present value of the defined benefit obligation for employee service in prior periods, resulting from the introduction or changes to a defined benefit plan. Such past service cost is immediately recognized as an expense for the period.

3.18.2 Short-term employee benefits

Short-term employee benefits are employee benefits that are expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related service. When an employee has rendered service to the Group during an accounting period, the Group recognizes the undiscounted amount of short-term employee benefits expected to be paid in exchange for that service as an expense for the period.

The expected cost of profit-sharing and bonus payments is recognized as liabilities when the Group has a present legal or constructive obligation to make payments as a result of past events, such as service rendered by employees, and a reliable estimate of the obligation can be made.

3.18.3 Share-based payment

The Group provides its executives and employees with stock grants and mileage stock programs. When stock grants are exercised, the Group can either select to distribute shares of KB Financial Group Inc., the Parent Company or compensate in cash based on the share price. When mileage stock is exercised, the Group pays the amount equivalent to share price of KB Financial Group Inc. in cash.

For a share-based payment transaction in which the terms of the arrangement provide the Group with the choice of whether to settle in cash or by issuing equity instruments, the Group accounts for the transaction in accordance with the requirements applying to cash-settled share-based payment transactions because the Group determines that it has a present obligation to settle in cash based on a past practice and a stated policy of settling in cash. Therefore, the Group measures the liability incurred as consideration for the service received at fair value and recognizes related expense and accrued expense over the vesting periods. For mileage stock, the Group accounts for the transaction in accordance with the requirements applying to cash-settled share-based payment transactions, which are recognized as expense and accrued expenses at the time of vesting.

Until the liability is settled, the Group remeasures the fair value of the liability at the end of each reporting period and at the date of settlement, with any changes in fair value recognized in profit or loss as share-based payments.

33

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

3.18.4 Termination benefits

Termination benefits are payable when employment is terminated by the Group before the normal retirement date, or an employee’s decision to accept an offer of benefits in exchange for the termination of employment. The Group recognizes a liability and expense for termination benefits at the earlier of the following dates; when the Group can no longer withdraw the offer of those benefits and when the Group recognizes costs for a restructuring that is within the scope of Korean IFRS No.1037 and involves the payment of termination benefits. If the termination benefits are not expected to be settled wholly before twelve months after the end of the annual reporting period, then the termination benefits are discounted to present value.

3.19 Income Tax Expense

Income tax expense comprises current tax expense and deferred income tax expense. Current and deferred income tax are recognized as income or expense and included in profit or loss for the period, except to the extent that the tax arises from (a) a transaction or event which is recognized, in the same or a different period, outside profit or loss, either in other comprehensive income or directly in equity and (b) a business combination.

3.19.1 Current income tax

Current income tax is the amount of income tax payable (recoverable) in respect of the taxable profit (tax loss) for a period. A difference between the taxable profit and accounting profit may arise when income or expense is included in accounting profit in one period but is included in taxable profit in a different period. Differences may also arise if there is revenue that is exempt from taxation, or expense that is not deductible in determining taxable profit (loss). Current income tax liabilities for the current and prior periods are measured using the tax rates that have been enacted or substantively enacted by the end of the reporting period.

The Group offsets current income tax assets and current income tax liabilities if, and only if, the Group (a) has a legally enforceable right to set off the recognized amounts and (b) intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

3.19.2 Deferred income tax

Deferred income tax is recognized, using the asset-liability method, on temporary differences arising between the tax-based amount of assets and liabilities and their carrying amount in the financial statements. Deferred income tax liabilities are recognized for all taxable temporary differences and deferred income tax assets are recognized for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilized. However, deferred income tax liabilities are not recognized if they arise from the initial recognition of goodwill; deferred income tax assets and liabilities are not recognized if they arise from the initial recognition of an asset or liability in a transaction that is not a business combination, and at the time of the transaction, affects neither accounting nor taxable profit or loss.

The Group recognizes a deferred income tax liability for all taxable temporary differences associated with investments in subsidiaries and associates, except to the extent that the Group is able to control the timing of the reversal of the temporary difference, and it is probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of a deferred income tax asset is reviewed at the end of each reporting period. The Group reduces the carrying amount of a deferred income tax asset to the extent that it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred income tax asset to be utilized.

34

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred income tax liabilities and deferred income tax assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

The Group offsets deferred income tax assets and deferred income tax liabilities if, and only if the Group has a legally enforceable right to set off current income tax assets against current income tax liabilities and the deferred income tax assets and the deferred income tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current income tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred income tax liabilities or assets are expected to be settled or recovered.

3.19.3 Uncertain tax positions

Uncertain tax positions arise from tax treatments applied by the Group which may be challenged by the tax authorities due to the complexity of the transaction or different interpretation of the tax laws, such as a claim for rectification, a claim for a refund related to additional tax or a tax investigation by the tax authorities. The Group recognizes its uncertain tax positions in the consolidated financial statements in accordance with Korean IFRS No.1012 and Interpretation of Korean IFRS No.2123. The income tax asset is recognized if a tax refund is probable for taxes levied by the tax authority, and the amount to be paid as a result of the tax investigation and others is recognized as the current tax payable. However, penalty tax and additional refund on tax are regarded as penalty or interest and are accounted for in accordance with Korean IFRS No.1037.

3.20 Transactions with the Trust Accounts

The Group accounts for trust assets separately from its own assets in accordance with the Financial Investment Services and Capital Markets Act. The borrowings from trust accounts represent transfer of funds in trust accounts into banking accounts. Such borrowings from trust accounts are recorded as receivables from the banking accounts in the trust accounts and as borrowings from trust accounts in the banking accounts. The Group earns trust fees from the trust accounts for its management of trust assets and operations. The reserves for future profits and losses are set up in the trust accounts for profits and losses related to those trust funds with a guarantee of the principal or of the principal and a certain minimum rate of return in accordance with the relevant laws and regulations applicable to trust operations. The reserves are used to provide for the losses on such trust funds and, if the losses incurred are in excess of the reserves, the excess losses are compensation paid as a loss on trust management in other operating expenses and the trust accounts recognize the corresponding compensation as compensation from banking accounts.

3.21 Lease

The Group as a lessor recognizes lease payments from operating leases as income on a straight-line basis over the lease term. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying asset and recognized as expense over the lease term on the same basis as lease income. The respective leased assets are included in the consolidated statement of financial position based on their nature.

A lessee is required to recognize a right-of-use asset (lease assets) representing its right to use the underlying leased asset and a lease liability representing its obligation to make lease payments. Assets and liabilities arising from a lease are initially measured at the present value.

35

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

Lease liabilities include the net present value of the following lease payments:

• Fixed payments (including in-substance fixed payments), less any lease incentives receivable

• Variable lease payments that depend on an index or a rate

• Amounts expected to be payable by the lessee under residual value guarantees

• The exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and

• Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease

The lease payments are discounted using the interest rate implicit in the lease if that rate can be readily determined. If that rate cannot be readily determined, the lessee’s incremental borrowing rate is used, which is the rate of interest that a lessee would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment.

Right-of-use assets are measured at cost comprising the following:

• The amount of the initial measurement of the lease liability

• Any lease payments made at or before the commencement date, less any lease incentives received

• Any initial direct costs incurred by the lessee, and

• An estimate of restoration costs

However, the Group can elect not to apply the requirements of Korean IFRS No.1116 to short-term lease (lease that, at the commencement date, has a lease term of 12 months or less) and leases for which the underlying asset is of low value (for example, underlying leased asset under USD 5,000). The Group applies the exemption of the standard for one time lease of real estate (for training purpose) and leases of low-value assets (underlying assets less than \ 5 million or USD 5,000).

The right-of-use asset is depreciated from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.

For sale and leaseback transactions, the Group applies the requirements of Korean IFRS No.1115 Revenue from Contracts with Customers, to determine whether the transfer of an asset is accounted for as a sale of that asset.

3.22 Operating Segments

The Group identifies its operating segments based on internal reports which are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance.

Segment information includes items which are directly attributable and can be allocated to the segment on a reasonable basis.

36

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4. Financial Risk Management

4.1 Summary

4.1.1 Overview of financial risk management policy

The financial risks that the Group is exposed to are credit risk, market risk, liquidity risk, operational risk, and others.

This note regarding financial risk management provides information about the risks that the Group is exposed to and about its objectives, policies, risk assessment and management procedures, and capital management. Additional quantitative information is disclosed throughout the consolidated financial statements.

The Group’s risk management system focuses on efficiently supporting long-term strategy and management decisions of each business group through increased risk transparency, spread of risk management culture, prevention of risk transfer between risk types, and preemptive response to rapidly changing financial environments. Credit risk, market risk, liquidity risk, and operational risk are recognized as the Group’s significant risks and measured and managed by quantifying them in the form of internal capital or Value at Risk (“VaR”) using statistical methods.

4.1.2 Risk management organization

4.1.2.1 Risk Management Committee

The Risk Management Committee, as the ultimate decision-making body, approves risk-related issues, such as establishing risk management strategies in accordance with the strategic direction determined by the board of directors, determining the affordable level of risk appetite, and reviewing the level of risk and the status of risk management activities.

4.1.2.2 Risk Management Council

The Risk Management Council deliberates on and resolves matters delegated by the Risk Management Committee and discusses the details of risk management of the Group.

4.1.2.3 Risk Management Subcommittees

The Risk Management Subcommittee implements decisions made by the Risk Management Council and makes practical decisions regarding the implementation of risk management policies and procedures.

• Credit Risk Management Subcommittee

The Credit Risk Management Subcommittee conducts deliberation and resolution on new approval of non-standard and compound instruments with embedded credit risks, review of credit risks for new products with credit risks, and establishment of exposure limits by industry.

• Market Risk Management Subcommittee

The Market Risk Management Subcommittee conducts deliberation and resolution on market risk-related matters, such as setting limits on market risk and approving detailed investment standards for new standard, non-standard and compound products.

• Operational Risk Management Subcommittee

The Operational Risk Management Subcommittee reviews the issues that have a significant effect on the Group’s operational risk such as establishment, amendment and abolition of major system, process and others.

37

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

• Trust & Fund Customer Asset Risk Management Subcommittee

The Trust & Fund Customer Asset Risk Management Subcommittee reviews the issues that have a significant effect on the trust & fund customer asset risk management such as setting limits on trust & fund customer assets.

4.1.2.4 Risk Management Group

The Risk Management Group manages detailed risk management policies, procedures, and business processes.

4.2 Credit Risk

4.2.1 Overview of credit risk

Credit risk is the risk of loss from the portfolio of assets held due to the counterparty’s default, breach of contract, and deterioration of credit quality. For risk management reporting purposes, the Group considers all factors of credit risk exposure, such as default risk of individual borrowers, country risk, and risk of specific sectors. The Group defines default as the definition applied to the calculation of Capital Adequacy Ratio under the new Basel Accord (Basel III).

4.2.2 Credit risk management

The Group measures the expected loss and internal capital for the assets subject to credit risk management, including on-balance and off-balance assets, and uses them as management indicators. The Group allocates and manages credit risk internal capital limits.

In addition, to prevent excessive concentration of exposures by borrower and industry, the total exposure limit at the Group level is introduced, applied, and managed to control the credit concentration risk.

All of the Group’s loan customers (individuals and corporates) are assigned a credit rating and managed by a comprehensive internal credit evaluation system. For individuals, the credit rating is evaluated by utilizing personal information, income and job information, asset information, and bank transaction information. For corporates, the credit rating is evaluated by analyzing and utilizing financial and non-financial information which measures current and future corporate value and ability to repay the debt. Also, the extent to which corporates have the ability to meet debt obligations is comprehensively considered.

The credit rating, once assigned, serves as the fundamental instrument in the Group’s credit risk management, and is applied in a wide range of credit risk management processes, including credit approval, credit limit management, loan pricing, and assessment of allowances for credit losses. For corporates, the Group conducts a regular credit evaluation at least once a year, and the review and supervision departments regularly validate the adequacy of credit ratings to manage credit risks.

In order to establish a credit risk management system, the Group manages credit risk by forming a separate risk management organization. In particular, independently of the Sales Group, the Credit Management & Analysis Group, Retail Customer Group and SME/SOHO Customer Group are in charge of loan policy, loan system, credit rating, credit analysis, follow-up management, and corporate restructuring. The Risk Management Group is responsible for establishing policies on credit risk management, measuring and limiting internal capital of credit risk, setting credit limits, credit review, and verification of credit rating models.

38

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.3 Maximum exposure to credit risk

The Group’s maximum exposures to credit risk without consideration of collateral values in relation to financial instruments other than equity securities as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Financial assets
Due from financial institutions 1		22,567,276		22,520,401
Financial assets at fair value through profit or loss:
Securities measured at fair value through profit or loss		20,756,579		18,513,088
Loans measured at fair value through profit or loss		149,075		93,930
Due from financial institutions measured at fair value through profit or loss		90,006		113,622
Derivatives		7,767,592		2,965,626
Loans measured at amortized cost 1		374,671,976		361,144,701
Financial investments:
Securities measured at fair value through other comprehensive income		38,363,832		38,140,906
Securities measured at amortized cost 1		35,236,794		22,164,594
Loans measured at fair value through other comprehensive income		231,021		269,609
Other financial assets 1		6,709,627		5,277,227
		506,543,778		471,203,704
Off-balance sheet items 2
Acceptances and guarantees contracts		12,510,649		10,212,730
Financial guarantee contracts		7,261,581		6,021,250
Commitments		108,399,534		97,135,905
		128,171,764		113,369,885
		634,715,542		584,573,589

¹ After netting of allowance

² For details of related provisions, see Note 22.

4.2.4 Credit risk of loans

The Group maintains allowances for loan losses associated with credit risk of loans to manage its credit risk.

The Group assesses expected credit losses and recognizes loss allowances of financial assets at amortized cost and financial assets at fair value through other comprehensive income (debt instruments). Financial assets at fair value through profit or loss are excluded. Expected credit losses are a probability-weighted estimate of possible credit losses occurring in a certain range by reflecting reasonable and supportable information that is reasonably available at the end of the reporting period without undue cost or effort, including information about past events, current conditions, and forecasts of future economic conditions. The Group measures the expected credit losses of loans classified as financial assets at amortized cost, by deducting allowances for credit losses. The expected credit losses of loans classified as financial assets at fair value through other comprehensive income are presented in other comprehensive income in the consolidated financial statements.

39

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.4.1 Credit risk exposure

Credit qualities of loans as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
(In millions of Korean won)			Non- impaired		Impaired
Loans measured at amortized cost *
Corporate
Grade 1		126,368,871		4,955,880		3,372		—		—		131,328,123
Grade 2		57,584,222		7,924,915		4,480		—		—		65,513,617
Grade 3		3,274,510		3,096,139		14,694		—		—		6,385,343
Grade 4		480,299		888,101		13,821		—		—		1,382,221
Grade 5		11,864		415,237		1,893,260		—		—		2,320,361
		187,719,766		17,280,272		1,929,627		—		—		206,929,665
Retail
Grade 1		156,074,706		3,990,601		10,917		—		—		160,076,224
Grade 2		3,297,187		3,732,378		12,737		—		—		7,042,302
Grade 3		961,206		1,212,650		14,973		—		—		2,188,829
Grade 4		21,458		140,868		5,529		—		—		167,855
Grade 5		20,549		325,174		642,967		—		—		988,690
		160,375,106		9,401,671		687,123		—		—		170,463,900
Credit card
Grade 1		—		—		—		—		—		—
Grade 2		25,210		—		—		—		—		25,210
Grade 3		—		—		—		—		—		—
Grade 4		—		—		—		—		—		—
Grade 5		—		1,219		16,593		—		—		17,812
		25,210		1,219		16,593		—		—		43,022
		348,120,082		26,683,162		2,633,343		—		—		377,436,587
Loans measured at fair value through other comprehensive income
Corporate
Grade 1		171,194		—		—		—		—		171,194
Grade 2		59,827		—		—		—		—		59,827
Grade 3		—		—		—		—		—		—
Grade 4		—		—		—		—		—		—
Grade 5		—		—		—		—		—		—
		231,021		—		—		—		—		231,021
		231,021		—		—		—		—		231,021
		348,351,103		26,683,162		2,633,343		—		—		377,667,608

40

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.4.1 Credit risk exposure (cont’d)

	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
(In millions of Korean won)			Non-impaired		Impaired
Loans measured at amortized cost *
Corporate
Grade 1		103,439,876		4,787,901		3,583		—		—		108,231,360
Grade 2		62,433,823		7,488,667		4,321		—		—		69,926,811
Grade 3		4,622,781		2,794,294		2,489		—		—		7,419,564
Grade 4		479,723		1,025,557		7,548		—		—		1,512,828
Grade 5		12,851		351,420		2,082,350		—		—		2,446,621
		170,989,054		16,447,839		2,100,291		—		—		189,537,184
Retail
Grade 1		157,931,555		4,297,133		10,972		—		—		162,239,660
Grade 2		4,174,715		4,066,176		12,202		—		—		8,253,093
Grade 3		762,603		1,128,603		8,161		—		—		1,899,367
Grade 4		38,566		140,041		3,134		—		—		181,741
Grade 5		494,814		305,052		605,210		—		—		1,405,076
		163,402,253		9,937,005		639,679		—		—		173,978,937
Credit card
Grade 1		—		—		—		—		—		—
Grade 2		32,376		—		—		—		—		32,376
Grade 3		935		—		—		—		—		935
Grade 4		—		—		—		—		—		—
Grade 5		—		—		22,209		—		—		22,209
		33,311		—		22,209		—		—		55,520
		334,424,618		26,384,844		2,762,179		—		—		363,571,641
Loans measured at fair value through other comprehensive income
Corporate
Grade 1		189,872		—		—		—		—		189,872
Grade 2		79,737		—		—		—		—		79,737
Grade 3		—		—		—		—		—		—
Grade 4		—		—		—		—		—		—
Grade 5		—		—		—		—		—		—
		269,609		—		—		—		—		269,609
		269,609		—		—		—		—		269,609
		334,694,227		26,384,844		2,762,179		—		—		363,841,250

* Before netting of allowance

Credit qualities of loans graded according to internal credit ratings as of December 31, 2022 and 2021, are as follows:

	Corporate	Retail
Grade 1	AAA ~ BBB+	1 ~ 5 grade
Grade 2	BBB ~ BB	6 ~ 8 grade
Grade 3	BB- ~ B	9 ~ 10 grade
Grade 4	B- ~ CCC	11 grade
Grade 5	CC or under	12 grade or under

41

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.4.2 Credit risk mitigation by collateral

Quantification of the extent to which collateral and other credit enhancements mitigate credit risk of loans as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
(In millions of Korean won)			Non-impaired		Impaired
Guarantees		99,393,584		7,045,683		286,796		—		—		106,726,063
Deposits and savings		1,854,286		141,016		46,971		—		—		2,042,273
Property and equipment		4,368,754		749,547		131,148		—		—		5,249,449
Real estate		185,056,374		15,469,830		1,604,270		—		—		202,130,474
		290,672,998		23,406,076		2,069,185		—		—		316,148,259

	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
(In millions of Korean won)			Non-impaired		Impaired
Guarantees		89,847,133		6,586,809		391,042		—		—		96,824,984
Deposits and savings		1,606,882		98,380		75,674		—		—		1,780,936
Property and equipment		4,364,540		327,722		279,961		—		—		4,972,223
Real estate		177,948,425		13,477,437		1,953,759		—		—		193,379,621
		273,766,980		20,490,348		2,700,436		—		—		296,957,764

42

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.5 Credit risk of securities

Credit qualities of securities exposed to credit risk other than equity securities among financial investments as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
(In millions of Korean won)			Non-impaired		Impaired
Securities measured at amortized cost *
Grade 1		33,528,652		—		—		—		—		33,528,652
Grade 2		1,713,576		—		—		—		—		1,713,576
Grade 3		—		—		—		—		—		—
Grade 4		—		—		—		—		—		—
Grade 5		—		—		—		—		—		—
		35,242,228		—		—		—		—		35,242,228
Securities measured at fair value through other comprehensive income
Grade 1		35,699,164		—		—		—		—		35,699,164
Grade 2		2,530,046		53,861		—		—		—		2,583,907
Grade 3		53,011		9,169		—		—		—		62,180
Grade 4		13,941		4,640		—		—		—		18,581
Grade 5		—		—		—		—		—		—
		38,296,162		67,670		—		—		—		38,363,832
		73,538,390		67,670		—		—		—		73,606,060

	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
(In millions of Korean won)			Non-impaired		Impaired
Securities measured at amortized cost *
Grade 1		21,219,056		—		—		—		—		21,219,056
Grade 2		935,607		—		—		—		—		935,607
Grade 3		5,588		7,641		—		—		—		13,229
Grade 4		—		—		—		—		—		—
Grade 5		—		—		—		—		—		—
		22,160,251		7,641		—		—		—		22,167,892
Securities measured at fair value through other comprehensive income
Grade 1		35,690,767		—		—		—		—		35,690,767
Grade 2		2,377,924		—		—		—		—		2,377,924
Grade 3		29,108		3,973		—		—		—		33,081
Grade 4		39,134		—		—		—		—		39,134
Grade 5		—		—		—		—		—		—
		38,136,933		3,973		—		—		—		38,140,906
		60,297,184		11,614		—		—		—		60,308,798

* Before netting of allowance

43

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

Credit qualities of securities other than equity securities, according to the credit ratings by external credit rating agencies as of December 31, 2022 and 2021, are as follows:

Credit quality	Domestic			Foreign
	KIS	NICE P&I	FnPricing Inc.	S&P	Fitch-IBCA	Moody’s
Grade 1	AA0 to AAA	AA0 to AAA	AA0 to AAA	A- to AAA	A- to AAA	A3 to Aaa
Grade 2	A- to AA-	A- to AA-	A- to AA-	BBB- to BBB+	BBB- to BBB+	Baa3 to Baa1
Grade 3	BBB0 to BBB+	BBB0 to BBB+	BBB0 to BBB+	BB to BB+	BB to BB+	Ba2 to Ba1
Grade 4	BB0 to BBB-	BB0 to BBB-	BB0 to BBB-	B+ to BB-	B+ to BB-	B1 to Ba3
Grade 5	BB- or under	BB- or under	BB- or under	B or under	B or under	B2 or under

Credit qualities of debt securities denominated in Korean won are based on the lowest credit rating by the domestic credit rating agencies above, and those denominated in foreign currencies are based on the lowest credit rating by the foreign credit rating agencies above.

4.2.6 Credit risk of due from financial institutions

Credit qualities of due from financial institutions as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Total
			Non-impaired		Impaired
Due from financial institutions measured at amortized cost *
Grade 1		20,678,308		—		—		—		20,678,308
Grade 2		1,428,613		—		—		—		1,428,613
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		462,230		—		—		—		462,230
		22,569,151		—		—		—		22,569,151

	December 31, 2021
(In millions of Korean won)	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Total
			Non-impaired		Impaired
Due from financial institutions measured at amortized cost *
Grade 1		20,705,356		—		—		—		20,705,356
Grade 2		1,305,500		—		—		—		1,305,500
Grade 3		61,177		—		—		—		61,177
Grade 4		439,511		—		—		—		439,511
Grade 5		10,984		—		—		—		10,984
		22,522,528		—		—		—		22,522,528

* Before netting of allowance

The classification criteria of the credit qualities of due from financial institutions as of December 31, 2022 and 2021, are the same as the criteria for securities other than equity securities.

44

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.7 Credit risk mitigation of derivative financial instruments

Quantification of the extent to which collateral mitigates credit risk of derivative financial instruments as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Deposits, savings, securities, and others		2,092,136		424,731

4.2.8 Credit risk concentration analysis

4.2.8.1 Classifications of loans by country as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Retail		Corporate *		Credit card		Total		%		Allowances			Carrying amount
Korea		166,731,576		180,852,359		—		347,583,935		92.00		(1,738,345	)		345,845,590
Japan		—		1,150,151		—		1,150,151		0.30		(1,756	)		1,148,395
United States		—		4,915,464		—		4,915,464		1.30		(14,868	)		4,900,596
China		140,061		7,131,142		—		7,271,203		1.92		(39,023	)		7,232,180
Cambodia		2,265,875		3,768,170		—		6,034,045		1.60		(66,198	)		5,967,847
Indonesia		1,174,259		2,896,037		43,022		4,113,318		1.09		(767,622	)		3,345,696
Others		152,129		6,596,438		—		6,748,567		1.79		(136,799	)		6,611,768
		170,463,900		207,309,761		43,022		377,816,683		100.00		(2,764,611	)		375,052,072

	December 31, 2021
(In millions of Korean won)	Retail		Corporate *		Credit card		Total		%		Allowances			Carrying amount
Korea		170,760,822		168,733,575		—		339,494,397		93.28		(1,459,209	)		338,035,188
Japan		86		1,082,456		—		1,082,542		0.30		(2,332	)		1,080,210
United States		—		3,313,100		—		3,313,100		0.91		(25,289	)		3,287,811
China		34,982		6,743,756		—		6,778,738		1.86		(34,315	)		6,744,423
Cambodia		1,748,349		3,115,992		—		4,864,341		1.34		(66,155	)		4,798,186
Indonesia		1,249,822		3,710,586		55,520		5,015,928		1.38		(821,707	)		4,194,221
Others		184,876		3,201,258		—		3,386,134		0.93		(17,933	)		3,368,201
		173,978,937		189,900,723		55,520		363,935,180		100.00		(2,426,940	)		361,508,240

* Expected credit losses of loans measured at fair value through other comprehensive income as of December 31, 2022 and 2021, are W 496 million and W 675 million, respectively.

45

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.8.2 Classifications of corporate loans by industry as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Loans *		%		Allowances			Carrying amount
Financial institutions		17,917,921		8.64		(17,541	)		17,900,380
Manufacturing		52,426,642		25.29		(570,253	)		51,856,389
Service		91,366,145		44.07		(414,123	)		90,952,022
Wholesale and retail		28,795,086		13.89		(346,570	)		28,448,516
Construction		5,061,780		2.44		(207,249	)		4,854,531
Public sector		1,653,869		0.80		(84,005	)		1,569,864
Others		10,088,318		4.87		(162,642	)		9,925,676
		207,309,761		100.00		(1,802,383	)		205,507,378

	December 31, 2021
(In millions of Korean won)	Loans *		%		Allowances			Carrying amount
Financial institutions		18,037,439		9.50		(13,657	)		18,023,782
Manufacturing		48,190,687		25.38		(502,209	)		47,688,478
Service		80,868,551		42.58		(387,437	)		80,481,114
Wholesale and retail		26,108,596		13.75		(246,687	)		25,861,909
Construction		4,387,199		2.31		(202,627	)		4,184,572
Public sector		1,832,305		0.96		(94,668	)		1,737,637
Others		10,475,946		5.52		(289,934	)		10,186,012
		189,900,723		100.00		(1,737,219	)		188,163,504

* Expected credit losses of loans measured at fair value through other comprehensive income as of December 31, 2022 and 2021, are W 496 million and W 675 million, respectively.

4.2.8.3 Classifications of retail loans and credit card receivables as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Loans		%		Allowances			Carrying amount
Housing loan		94,184,985		55.24		(158,566	)		94,026,419
General loan		76,278,915		44.74		(787,905	)		75,491,010
Credit card		43,022		0.02		(15,757	)		27,265
		170,506,922		100.00		(962,228	)		169,544,694

	December 31, 2021
(In millions of Korean won)	Loans		%		Allowances			Carrying amount
Housing loan		93,249,089		53.58		(68,753	)		93,180,336
General loan		80,729,848		46.39		(600,372	)		80,129,476
Credit card		55,520		0.03		(20,596	)		34,924
		174,034,457		100.00		(689,721	)		173,344,736

46

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.8.4 Classifications of domestic mortgage loans as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Loans *		%		Allowances			Carrying amount
Group1		15,950,511		16.30		(17,178	)		15,933,333
Group2		35,821,717		36.62		(40,603	)		35,781,114
Group3		35,626,337		36.42		(45,807	)		35,580,530
Group4		10,020,031		10.24		(12,809	)		10,007,222
Group5		399,823		0.41		(618	)		399,205
Group6		11,588		0.01		(74	)		11,514
		97,830,007		100.00		(117,089	)		97,712,918

	December 31, 2021
(In millions of Korean won)	Loans *		%		Allowances			Carrying amount
Group1		16,780,623		17.13		(10,465	)		16,770,158
Group2		39,583,150		40.41		(10,375	)		39,572,775
Group3		31,772,074		32.43		(9,957	)		31,762,117
Group4		9,677,419		9.88		(6,517	)		9,670,902
Group5		140,182		0.14		(273	)		139,909
Group6		10,328		0.01		(87	)		10,241
		97,963,776		100.00		(37,674	)		97,926,102

* Retail loans for general purpose with the real estate as collateral are included.

	Ranges
Group1	LTV 0% to less than 20%
Group2	LTV 20% to less than 40%
Group3	LTV 40% to less than 60%
Group4	LTV 60% to less than 80%
Group5	LTV 80% to less than 100%
Group6	LTV over 100%

* LTV: Loan to Value ratio

47

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.8.5 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by industry as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Finance and insurance		22,569,151		100.00		(1,875	)		22,567,276
		22,569,151		100.00		(1,875	)		22,567,276
Securities measured at fair value through profit or loss
Government and government funded institutions		5,268,226		25.38		—			5,268,226
Finance and insurance 1		14,163,418		68.24		—			14,163,418
Others		1,324,935		6.38		—			1,324,935
		20,756,579		100.00		—			20,756,579
Derivative financial assets
Government and government funded institutions		56,464		0.73		—			56,464
Finance and insurance 1		7,345,736		94.57		—			7,345,736
Others		365,392		4.70		—			365,392
		7,767,592		100.00		—			7,767,592
Securities measured at fair value through other comprehensive income 2
Government and government funded institutions		14,939,808		38.94		—			14,939,808
Finance and insurance		17,440,865		45.46		—			17,440,865
Others		5,983,159		15.60		—			5,983,159
		38,363,832		100.00		—			38,363,832
Securities measured at amortized cost
Government and government funded institutions		16,921,939		48.02		—			16,921,939
Finance and insurance		17,749,393		50.36		(5,109	)		17,744,284
Others		570,896		1.62		(325	)		570,571
		35,242,228		100.00		(5,434	)		35,236,794
		124,699,382				(7,309	)		124,692,073

48

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.8.5 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by industry as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021
(In millions of Korean won)	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Finance and insurance		22,522,528		100.00		(2,127	)		22,520,401
		22,522,528		100.00		(2,127	)		22,520,401
Securities measured at fair value through profit or loss
Government and government funded institutions		3,367,648		18.19		—			3,367,648
Finance and insurance 1		12,336,217		66.64		—			12,336,217
Others		2,809,223		15.17		—			2,809,223
		18,513,088		100.00		—			18,513,088
Derivative financial assets
Government and government funded institutions		6,985		0.24		—			6,985
Finance and insurance 1		2,810,005		94.75		—			2,810,005
Others		148,636		5.01		—			148,636
		2,965,626		100.00		—			2,965,626
Securities measured at fair value through other comprehensive income 2
Government and government funded institutions		13,553,504		35.54		—			13,553,504
Finance and insurance		19,463,563		51.03		—			19,463,563
Others		5,123,839		13.43		—			5,123,839
		38,140,906		100.00		—			38,140,906
Securities measured at amortized cost
Government and government funded institutions		12,402,272		55.95		—			12,402,272
Finance and insurance		9,552,417		43.09		(3,075	)		9,549,342
Others		213,203		0.96		(223	)		212,980
		22,167,892		100.00		(3,298	)		22,164,594
		104,310,040				(5,425	)		104,304,615

¹  Collective investment securities (including transactions with collective investment schemes) are classified as finance and insurance.

²  Expected credit losses of securities measured at fair value through other comprehensive income as of December 31, 2022 and 2021, are W 6,432 million and W 8,223 million, respectively.

49

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.8.6 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by country as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Korea		16,991,323		75.29		—			16,991,323
United States		2,173,982		9.63		(27	)		2,173,955
Others		3,403,846		15.08		(1,848	)		3,401,998
		22,569,151		100.00		(1,875	)		22,567,276
Securities measured at fair value through profit or loss
Korea		19,316,603		93.06		—			19,316,603
United States		897,338		4.32		—			897,338
Others		542,638		2.62		—			542,638
		20,756,579		100.00		—			20,756,579
Derivative financial assets
Korea		3,456,882		44.50		—			3,456,882
United States		1,325,575		17.07		—			1,325,575
France		1,281,270		16.50		—			1,281,270
Others		1,703,865		21.93		—			1,703,865
		7,767,592		100.00		—			7,767,592
Securities measured at fair value through other comprehensive income *
Korea		34,586,537		90.15		—			34,586,537
United States		732,183		1.91		—			732,183
Others		3,045,112		7.94		—			3,045,112
		38,363,832		100.00		—			38,363,832
Securities measured at amortized cost
Korea		30,511,462		86.58		(3,746	)		30,507,716
United States		2,740,296		7.78		(949	)		2,739,347
United Kingdom		111,146		0.32		(89	)		111,057
Others		1,879,324		5.32		(650	)		1,878,674
		35,242,228		100.00		(5,434	)		35,236,794
		124,699,382				(7,309	)		124,692,073

50

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.2.8.6 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by country as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021
(In millions of Korean won)	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Korea		16,666,513		74.00		—			16,666,513
United States		2,381,704		10.57		(39	)		2,381,665
Others		3,474,311		15.43		(2,088	)		3,472,223
		22,522,528		100.00		(2,127	)		22,520,401
Securities measured at fair value through profit or loss
Korea		16,289,547		87.99		—			16,289,547
United States		1,246,236		6.73		—			1,246,236
Others		977,305		5.28		—			977,305
		18,513,088		100.00		—			18,513,088
Derivative financial assets
Korea		1,060,073		35.75		—			1,060,073
United States		707,545		23.86		—			707,545
France		370,787		12.50		—			370,787
Others		827,221		27.89		—			827,221
		2,965,626		100.00		—			2,965,626
Securities measured at fair value through other comprehensive income *
Korea		34,298,370		89.93		—			34,298,370
United States		556,810		1.46		—			556,810
Others		3,285,726		8.61		—			3,285,726
		38,140,906		100.00		—			38,140,906
Securities measured at amortized cost
Korea		21,250,543		95.86		(2,803	)		21,247,740
United States		76,812		0.35		(106	)		76,706
United Kingdom		157,558		0.71		(141	)		157,417
Others		682,979		3.08		(248	)		682,731
		22,167,892		100.00		(3,298	)		22,164,594
		104,310,040				(5,425	)		104,304,615

* Expected credit loss of securities measured at fair value through other comprehensive income as of December 31, 2022 and 2021, are W 6,432 million and W 8,223 million, respectively.

Due from financial institutions, financial instruments at fair value through profit or loss linked to gold price, and derivative financial instruments are mostly related to the finance and insurance industry with high credit ratings.

51

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.3 Liquidity Risk

4.3.1 Overview of liquidity risk

Liquidity risk is a risk that the Group becomes insolvent due to the mismatch between the inflow and outflow of funds, unexpected cash outflows, or a risk of loss due to financing funds at a high interest rate or disposing of securities at an unfavorable price due to lack of available funds. The Group manages its liquidity risk through analysis of the contractual maturity of interest-bearing assets and liabilities, assets and liabilities related to the other inflows and outflows of funds, and off-balance sheet items related to the inflows and outflows of funds such as currency derivative instruments and others.

4.3.2 Liquidity risk management and indicator

The liquidity risk is managed by comprehensive risk management policies and Asset Liability Management (“ALM”) risk management guidelines set forth in these policies that apply to all risk management policies and procedures that may arise throughout the overall business of the Group.

The Group establishes a liquidity risk management strategy, including objectives of liquidity risk management, management policies, and internal control systems, and obtains a resolution from the Risk Management Committee. The Risk Management Committee establishes the Risk Management Council for efficient risk management to supervise the establishment and implementation of policies according to risk management strategies.

The Group calculates and manages Liquidity Coverage Ratio (“LCR”), Net Stable Funding Ratio (“NSFR”), liquidity ratio, maturity mismatch ratio and liquidity stress testing result for all transactions and off-balance transactions, that affect the cash flows in Korean won and foreign currency funds raised and operated for the management of liquidity risks and periodically reports them to the Risk Management Council and the Risk Management Committee.

4.3.3 Analysis of remaining contractual maturity of financial liabilities

The cash flows disclosed in the maturity analysis are undiscounted contractual amounts including principal and future interest and payments; as such, amounts in the table below do not match with those in the consolidated statements of financial position which are based on discounted cash flows. The future interest payments of floating-rate liabilities are calculated on the assumption that the current interest rate is the same until maturity.

52

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.3.3.1 Remaining contractual maturity of financial liabilities other than derivatives held for cash flow hedge, and off-balance sheet items as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	On demand		Up to 1 month			1-3 months		3-12 months		1-5 years		Over 5 years		Total
Financial liabilities
Financial liabilities at fair value through profit or loss 1		108,862		—			—		—		—		—		108,862
Derivatives held for trading 1		7,166,578		—			—		—		—		—		7,166,578
Derivatives held for hedging 2		—		(558	)		5,312		24,067		66,255		3,502		98,578
Deposits 3		165,559,338		29,758,040			45,029,511		129,992,322		17,707,676		1,246,571		389,293,458
Borrowings		59,631		18,276,814			5,913,564		13,305,936		7,627,555		1,039,377		46,222,877
Debentures		11,117		1,755,336			4,612,664		12,426,307		8,177,425		4,794,132		31,776,981
Lease liabilities		164		15,554			30,494		115,109		208,982		20,075		390,378
Other financial liabilities		—		13,431,913			1,508		132,242		58,663		—		13,624,326
		172,905,690		63,237,099			55,593,053		155,995,983		33,846,556		7,103,657		488,682,038
Off-balance sheet items
Commitments 4		108,399,534		—			—		—		—		—		108,399,534
Acceptances and guarantees contracts		12,510,649		—			—		—		—		—		12,510,649
Financial guarantee contracts 5		7,261,581		—			—		—		—		—		7,261,581
		128,171,764		—			—		—		—		—		128,171,764

	December 31, 2021
(In millions of Korean won)	On demand		Up to 1 month		1-3 months		3-12 months		1-5 years		Over 5 years		Total
Financial liabilities
Financial liabilities at fair value through profit or loss 1		112,698		—		—		—		—		—		112,698
Derivatives held for trading 1		2,706,941		—		—		—		—		—		2,706,941
Derivatives held for hedging 2		—		2,291		5,996		6,589		15,213		1,423		31,512
Deposits 3		197,481,610		16,451,640		30,892,560		109,842,440		9,940,768		1,412,235		366,021,253
Borrowings		55,250		9,790,484		4,454,109		10,242,437		7,335,764		901,063		32,779,107
Debentures		14,528		1,163,009		3,233,191		12,576,806		9,468,210		4,769,756		31,225,500
Lease liabilities		139		15,672		29,838		113,617		215,641		18,616		393,523
Other financial liabilities		—		16,929,504		1,486		119,647		47,631		—		17,098,268
		200,371,166		44,352,600		38,617,180		132,901,536		27,023,227		7,103,093		450,368,802
Off-balance sheet items
Commitments 4		97,135,905		—		—		—		—		—		97,135,905
Acceptances and guarantees contracts		10,212,730		—		—		—		—		—		10,212,730
Financial guarantee contracts 5		6,021,250		—		—		—		—		—		6,021,250
		113,369,885		—		—		—		—		—		113,369,885

¹ Financial liabilities at fair value through profit or loss and derivatives held for trading are not managed by contractual maturity because they are expected to be traded or redeemed before maturity. Therefore, the carrying amounts of those financial instruments are included in the ‘On demand’ category.

² Cash flows of derivative instruments held for hedging are shown at net amount of cash inflows and outflows by remaining contractual maturity.

³ Deposits that are contractually repayable on demand or on short notice are included in the ‘On demand’ category.

⁴ Unused lines of credit within commitments are included in the ‘On demand’ category because payments can be requested at any time.

⁵ Cash flows under financial guarantee contracts are classified based on the earliest period that the contract can be executed.

53

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.3.3.2 Contractual cash flows of derivatives held for cash flow hedge as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Up to 1 month		1-3 months		3-12 months		1-5 years		Over 5 years		Total
Cash flow to be received of net-settled derivatives		337		8,038		13,090		49,098		—		70,563
Cash flow to be paid of net-settled derivatives		218		975		1,571		93		—		2,857

	December 31, 2021
(In millions of Korean won)	Up to 1 month		1-3 months		3-12 months		1-5 years		Over 5 years		Total
Cash flow to be received of net-settled derivatives		601		427		2,989		—		—		4,017
Cash flow to be paid of net-settled derivatives		313		2,437		3,238		110		—		6,098

4.4 Market Risk

4.4.1 Concept

Market risk refers to risks that can result in losses due to changes in market factors such as interest rate, stock price, and foreign exchange rate, etc., which arise from securities, derivatives, and others. The most significant risks associated with trading positions are interest rate risk, currency risk, and additional risks include stock price risk. The non-trading position is also exposed to interest rate risk. The Group manages the market risks by dividing them into those arising from the trading position and those arising from the non-trading position.

4.4.2 Risk management

The Group sets and monitors internal capital limits for market risk and interest rate risk to manage the risks of trading and non-trading positions. In order to manage market risk efficiently, the Group maintains risk management systems and procedures such as trading policies and procedures, market risk management guidelines for trading positions, and ALM risk management guidelines for non-trading positions. The entire process is carried out through the approval by the Risk Management Council and the Risk Management Committee of the Group.

The Group’s Risk Management Council establishes and enforces overall market risk management policies for market risk management and decides to establish position limits, loss limits, VaR limits, and approves non-standard new products. In addition, the Market Risk Management Subcommittee, chaired by Chief Risk Officer (“CRO”), is a practical decision-making body for market risk management and determines position limits, loss limits, VaR limits, sensitivity limits, and scenario loss limits for each department of the business group.

54

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

The Asset-Liability Management Committee (“ALCO”) determines interest rate and commission operating standards and ALM operation policies and enacts and revises relevant guidelines. The Risk Management Council monitors the establishment and enforcement of ALM risk management policies and enacts and revises ALM risk management guidelines. Interest rate risk limits are set based on future asset and liability positions and expected interest rate volatility, which reflect annual business plans. The ALM Department and the Risk Management Department regularly measure and monitor interest rate risk and report the status and limit of interest rate risk including changes in Economic Value of Equity (“ΔEVE”), changes in Net Interest Income (“ΔNII”), and duration gap to the ALCO and the Risk Management Council on a monthly basis, and to the Risk Management Committee on a quarterly basis. To ensure the adequacy of interest rate risk and liquidity risk management, the Risk Management Department assigns the limits, monitors and reviews the procedures and tasks of ALM operations conducted by the ALM department, and reports related matters to the management independently.

The Group is closely monitoring the outputs of various industry groups and markets that manage the transition to the new interest rate benchmark, including announcements by LIBOR regulation authority and various consultative bodies related to the transition to alternative interest rate. In response to these announcements, the Group has completed most of the transition and replacement plans according to LIBOR transition programs and plans consisting of major business areas such as finance, accounting, tax, legal, IT, and risk. The program is under the control of the CFO and related matters are reported to the board of directors and consultative bodies with senior management as members. The Group continues its efforts as a market participant to actively express opinions so that the index interest rate benchmark reform can be carried out in the direction of minimizing the financial and non-financial impacts and operational risks on the Group and minimizing confusion among stakeholders.

4.4.3 Trading position

4.4.3.1 Definition of a trading position

The trading position, which is subject to market risk management, includes interest rate position and stock position held for short-term trading profit. The Group also includes and manages all foreign currency positions in our trading positions. The trading position subject to market risk management is the trading position defined in “Trading Policy and Guidelines” and the basic requirements for the trading position are as follows:

• The target position has no restrictions on the sale, and the daily fair value assessment should be made, and the embedded significant risk can be hedged in the market.

• The trading position classification criteria should be clearly defined in the Trading Policy and Guidelines, and the trading position should be managed by a separate trading department.

• The target position must be operated according to the documented trading strategy and the management of position limit must be carried out.

• The specialized dealer or operating department shall have the authority to execute the transaction without prior approval from the Risk Management Department, etc. within the predetermined limits of the target position.

• The target positions should be periodically reported to management for risk management of the Group.

55

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.4.3.2 Observation method of market risk arising from trading positions

The Group measures market risk by calculating VaR through the market risk management system for all trading positions. Generally, the Group manages market risk arising from trading positions at the portfolio level. In addition, the Group controls and manages the risk of derivative financial instrument transactions in accordance with the Financial Supervisory Service regulations and guidelines.

4.4.3.3 VaR

(a) VaR

The Group uses the risk-based valuation method (VaR) to measure the market risk of the trading position.

The Group uses the 10-day VaR, which represents the maximum amount of possible loss of 10 business days based on the historical simulation model of the full valuation method. The distribution of value changes in the portfolio is estimated based on data from the past 250 business days, and 10-day VaR is calculated by the difference between the value of the portfolio at a 99% confidence level of distribution of value changes in the portfolio and the current market value.

VaR is a commonly used market risk measurement technique. However, this approach has some limitations. VaR estimates possible losses under a certain confidence level based on historical market change data. However, since past market changes cannot reflect all future conditions and circumstances, the timing and magnitude of actual losses may vary depending on assumptions in the calculation process. If one day or ten days of the holding period which is generally used for the normal period of liquidating the position, is not sufficient or too long, the VaR result may underestimate or overestimate the potential loss.

When the Group measures market risk for trading position, it uses an internal model (VaR) for general risk and a standard method for individual risks. Standard method is used if the internal model is not authorized for certain market risk. Therefore, disclosed market risk VaR does not reflect the market risk for individual risks and for some positions.

(b) Back-Testing

To verify the appropriateness of the VaR model, back-testing is performed by comparing actual and hypothetical gains and losses with the VaR calculation results.

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Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

(c) Stress Testing

The Group carries out stress testing of the trading and available-for-sale portfolio to reflect changes in individual risk factors such as interest rate, stock price, foreign exchange rate, and implied volatility of options that have a significant impact on portfolio value in a crisis. The Group carries out stress testing through historical and hypothetical scenarios. This stress testing is carried out at least once a quarter.

VaR at a 99% confidence level of interest rate risk, stock price risk, and currency risk for trading positions with a ten-day holding period, excluding Stressed VaR, for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Average		Minimum		Maximum		December 31, 2022
Interest rate risk		34,923		16,541		64,356		47,093
Stock price risk		8,606		5,142		11,061		9,407
Currency risk		24,054		14,428		41,815		41,189
Diversification effect								(5,140	)
Total VaR		49,701		22,144		99,436		92,549

	2021
(In millions of Korean won)	Average		Minimum		Maximum		December 31, 2021
Interest rate risk		20,051		6,372		55,670		16,534
Stock price risk		9,067		4,537		24,824		5,513
Currency risk		27,886		17,820		49,264		21,522
Diversification effect								(13,039	)
Total VaR		40,915		15,986		115,347		30,530

The required equity capital using the standard method related to the positions which are not measured by VaR as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Interest rate risk		18,545		25,432
Stock price risk		4,686		6
Currency risk		70,757		46,173
		93,988		71,611

4.4.3.4 Details of risk factors

(a) Interest rate risk

Interest rate risk for trading positions usually arises from debt securities denominated in Korean won. The Group’s trading strategy is to gain short-term trading gains from interest rate fluctuations. The Group manages interest rate risk associated with trading portfolios using VaR and sensitivity analysis (Price Value of a Basis Point: PVBP).

57

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

(b) Stock price risk

Stock price risk arises mainly from stock positions held by principal guaranteed trust and derivatives linked to stocks positions in the Capital Markets Department. This stock price risk is managed through VaR, sensitivity limits, and others.

(c) Currency risk

Currency risk arises from holding assets and liabilities which are denominated in foreign currency, and currency-related derivatives. Most of the net foreign currency exposures occur in the US dollars and the Chinese Yuan. The Group also manages net foreign exchange exposures across trading and non-trading portfolios by setting a net foreign currency exposure limit at the same time setting a loss limit.

4.4.4 Non-trading position (Interest Rate Risk of Banking Book (“IRRBB”))

4.4.4.1 Definition of IRRBB

IRRBB is a change in equity and earnings due to the changes in value of interest-sensitive assets and liabilities, etc., and is measured by ΔEVE and ΔNII.

4.4.4.2 The Bank’s overall interest rate risk management and mitigation strategy

The Risk Management Committee approves policies, procedures and limits for managing interest rate risk, and the management department regularly reports on interest rate risk levels of ΔEVE and ΔNII against the set limit, changes in market conditions, and others. In order to measure the sensitivity of the economic value and earnings to changes in interest rates, the Bank calculates monthly interest rate gap and duration gap for assets and liabilities. In addition, the management department conducts an interest rate risk crisis analysis at least once a quarter assuming abnormal interest rate fluctuations and reports the results to the Risk Management Council. Independent internal and external audit department regularly check the process of identifying, measuring and monitoring interest rate risk. The interest rate risk model adequacy test is carried out regularly at least once a year by the verification department independent of the management department.

4.4.4.3 Main modeling assumption used for the Bank’s interest rate risk measurement system for internal management

The Bank separately calculates ΔEVE for internal management of interest rate risk, assuming a historical-simulation based on interest rate volatility during the past financial crisis (FY2008-FY2009), distribution of assets/liabilities portfolio, and 27 interest rate gaps considering management strategy.

4.4.4.4 The Bank’s interest rate risk hedging methodology and related accounting

The Bank hedges interest rate risk through back-to-back interest rate swap transactions, which are the same as interest payment cash flows. The Bank officially documents and manages the risk management strategy for hedge accounting, risk management objectives, hedging relationship, and assessment method for hedge effectiveness.

58

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.4.4.5 Main assumptions used for calculating ΔEVE, ΔNII

The Bank calculates interest rate risk, including all cash flow of interest-sensitive assets and liabilities, and off-balance sheet items in the banking book. ΔEVE assumes a run-off balance sheet where the existing bank account positions are amortized and not replaced by new businesses. In addition, the contractual interest rate, including commercial margins and other spread components, is applied to generate cash flows. When discounting cash flow, ΔEVE is calculated by applying risk-free interest rate that do not include commercial margins and other spread components.

ΔNII assumes a constant balance sheet where maturing or repricing cash flows during the target management period are replaced by new cash flows with identical features. The interest rate risk is calculated for the interest rate shock scenario by adding up only if the risk is a loss for each currency. After classifying into retail/transactional, retail/non-transactional, and wholesale according to customers and regular transactions, the average repricing maturity of non-maturity deposits is determined by taking into account proportion of core deposits and cap on average maturity of core deposits for each category. The average repricing maturity of non-maturity deposits is 2.5 years for core deposits, 1 day for non-core deposits, and the longest repricing maturity is five years. The prepayment rate of fixed rate loans and term deposit redemption ratio are estimated by dividing the amount of prepayment amount and redemption amount during the previous month by the balance at the end of the previous month, respectively.

4.4.4.6 ΔEVE and ΔNII

The Bank calculates ΔEVE by applying six interest rate shock and stress scenarios, and ΔNII is calculated by applying parallel shock up and parallel shock down scenarios. Results as of December 31, 2022 and 2021, are as follows:

	December 31, 2022				December 31, 2021
(In millions of Korean won)	ΔEVE		ΔNII		ΔEVE		ΔNII
Scenario 1 (Parallel shock up)		165,634		162,959		936,965		564,771
Scenario 2 (Parallel shock down)		290,330		—		—		—
Scenario 3 (Short rates down and long rates up)		266,737				273,951
Scenario 4 (Short rates up and long rates down)		268,261				311,497
Scenario 5 (Short rates shock up)		288,737				568,246
Scenario 6 (Short rates shock down)		132,998				345,987
Maximum out of six scenarios		290,330		162,959		936,965		564,771
Basic capital		31,176,032				30,491,173

59

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.4.5 Financial assets and liabilities denominated in foreign currencies

Details of financial instruments denominated in foreign currencies and translated into Korean won as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	USD		JPY		EUR		GBP		CNY		Others		Total
Financial assets
Cash and due from financial institutions		4,964,404		339,074		170,860		40,392		543,311		1,606,586		7,664,627
Financial assets at fair value through profit or loss		2,036,628		—		349,039		—		—		161,943		2,547,610
Derivatives held for trading		533,788		—		115		10		19,053		1,006		553,972
Derivatives held for hedging		193,063		—		—		—		—		290		193,353
Loans measured at amortized cost		32,541,243		683,704		2,360,630		622,702		1,944,500		5,442,230		43,595,009
Financial assets at fair value through other comprehensive income		4,409,688		—		9,091		5,677		556,052		873,788		5,854,296
Financial assets at amortized cost		4,197,224		—		—		37,816		60,013		1,041,651		5,336,704
Other financial assets		1,646,663		292,283		351,415		23,545		92,508		135,484		2,541,898
		50,522,701		1,315,061		3,241,150		730,142		3,215,437		9,262,978		68,287,469
Financial liabilities
Derivatives held for trading		271,778		246		182		10		6,868		957		280,041
Derivatives held for hedging		104,856		—		—		—		—		—		104,856
Deposits		25,220,691		1,244,037		1,381,500		344,559		2,301,110		5,205,509		35,697,406
Borrowings		18,652,958		458,856		363,990		351,536		266,727		1,419,793		21,513,860
Debentures		6,939,542		—		2,041,516		—		36,288		601,929		9,619,275
Other financial liabilities		3,495,067		266,505		188,414		13,502		100,020		237,452		4,300,960
		54,684,892		1,969,644		3,975,602		709,607		2,711,013		7,465,640		71,516,398
Off-balance sheet items		20,669,795		—		189,450		60,382		220,890		475,611		21,616,128

	December 31, 2021
(In millions of Korean won)	USD		JPY		EUR		GBP		CNY		Others		Total
Financial assets
Cash and due from financial institutions		5,663,272		335,167		211,344		50,876		489,219		1,005,355		7,755,233
Financial assets at fair value through profit or loss		2,157,251		—		326,279		—		—		143,386		2,626,916
Derivatives held for trading		148,078		—		—		—		5,549		821		154,448
Derivatives held for hedging		82,062		—		—		—		—		90		82,152
Loans measured at amortized cost		26,281,961		583,537		1,546,316		234,612		1,774,589		5,642,904		36,063,919
Financial assets at fair value through other comprehensive income		5,490,476		5,152		121,573		6,273		536,747		351,873		6,512,094
Financial assets at amortized cost		706,511		—		—		—		48,435		448,750		1,203,696
Other financial assets		1,416,785		36,398		95,892		6,874		48,406		115,705		1,720,060
		41,946,396		960,254		2,301,404		298,635		2,902,945		7,708,884		56,118,518
Financial liabilities
Derivatives held for trading		193,160		71		71		—		18,224		1,223		212,749
Derivatives held for hedging		42,470		—		—		—		—		—		42,470
Deposits		20,794,853		847,257		1,835,384		106,321		1,935,261		5,361,049		30,880,125
Borrowings		14,112,294		456,029		304,678		190,436		—		1,412,587		16,476,024
Debentures		6,026,995		—		1,338,391		—		102,443		435,515		7,903,344
Other financial liabilities		1,611,665		23,141		138,497		15,037		74,403		155,868		2,018,611
		42,781,437		1,326,498		3,617,021		311,794		2,130,331		7,366,242		57,533,323
Off-balance sheet items		16,739,153		353		186,938		800		250,239		524,708		17,702,191

60

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

4.4.6 Risk management according to interest rate benchmark reform

Details of financial instruments that have not been converted to alternative interest rate benchmark as of December 31, 2022 and 2021, are as follows:

	December 31, 2022 *				December 31, 2021 *
(In millions of Korean won)	USD LIBOR		Others		USD LIBOR		Others
Measured at fair value (non-derivative)
Financial investments at fair value through other comprehensive income		22,800		—		231,702		—
Measured at amortized cost
Loans		1,946,200		—		3,726,542		55,800
Borrowings and debentures		152,200		—		513,069		—
Others
Derivative financial instruments		—		—		1,126,930		—

* Financial instruments to be expired before transition to alternative interest rate benchmark are excluded, and non-derivative financial instruments are the carrying amount and others are the nominal amount.

4.5 Operational Risk

4.5.1 Concept

The Group defines operational risk as loss risk arising from improper or incorrect internal procedures, personnel, systems or external events and includes financial and non-financial risks.

4.5.2 Risk management

The purpose of operational risk management is not only to comply with supervisory and regulatory requirements, but also to spread risk management culture, strengthen internal control, improve processes, and provide timely feedback to management and all employees. The Group established a Business Continuity Planning (BCP) to carry out continuous work in emergency situations and established alternative facilities. The Group conducts simulation training for headquarters and IT departments to check the business continuity framework.

4.6 Capital Management

The Group complies with the capital adequacy standard established by the financial supervisory authority. This capital adequacy standard is based on Basel III revised by Basel Committee on Banking Supervision in Bank for International Settlements (“BIS”) in June 2011 and was implemented in Korea in December 2013.

According to this standard, the Group is required to maintain a minimum capital adequacy ratio to risk-weighted assets (Common Equity Tier 1 Capital ratio of 4.5%, Tier 1 Capital ratio of 6.0%, and Total Capital ratio of 8.0%) as of December 31, 2022. Capital Conservation Buffer of 2.5% and Capital Requirement of Domestic Systemically Important Bank (D-SIB) of 1.0% are additionally applied. Therefore, the Group is required to maintain a capital adequacy ratio including a minimum capital adequacy ratio and additional capital requirements (Common Equity Tier 1 Capital ratio of 8.0% (December 31, 2021: 8.0%), Tier 1 Capital ratio of 9.5% (December 31, 2021: 9.5%), and Total Capital ratio of 11.5% (December 31, 2021: 11.5%)).

61

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

The Group’s capital is classified into three categories in accordance with the Detailed Regulations on Supervision of Banking Business as follows:

• Common Equity Tier 1 Capital: Common equity Tier 1 Capital is the first to take losses of the Group and is the last to be compensated in liquidation of the Group and not repaid except for liquidation. It includes capital, capital surplus, retained earnings, non-controlling interests of the consolidated subsidiaries, accumulated other comprehensive income, and other capital surplus, etc.

• Additional Tier 1 Capital: Additional Tier 1 Capital includes capital, capital surplus, etc. related to the issuance of capital securities of a permanent nature that meets the conditional capital securities requirements.

• Tier 2 Capital: Tier 2 Capital means capital that can compensate for losses of the Group upon liquidation, including (a) the amount of subordinated bonds with maturity of not less than 5 years that meet the conditional capital securities requirements, and (b) the allowances for credit losses accumulated on the loans which are classified as normal or precautionary in accordance with Regulations on Supervision of Banking Business, and others.

The risk-weighted assets are the magnitude of assets that reflect the risk that the Group has to bear, including risks inherent in all assets, errors in the operation of internal processes, and risk of loss that may arise from external events. The Group calculates risk-weighted assets by each risk (credit risk, market risk, and operational risk) based on the Detailed Regulations on Supervision of Banking Business and uses them to calculate capital adequacy ratio. The Group complied with external capital adequacy requirements as of December 31, 2022 and 2021.

Apart from the capital adequacy ratio, the Group evaluates and manages capital adequacy through internal policies. The evaluation of capital adequacy compares the size of available capital (the amount of capital actually available) to the size of internal capital (the amount of capital required to cover all the significant risks faced by the Group under its target credit rating), which monitors financial soundness and provides a risk-adjusted performance measurement basis. The internal capital for capital adequacy assessment is calculated by adding the results of a stress test and other additional capital requirements to the internal capital calculated for each individual risk.

The Risk Management Committee of the Group determines the risk appetite of the Group, allocates internal capital by risk type and business group, and each business group operates capital efficiently within the range of the allocated internal capital. The Risk Management Department of the Group monitors internal capital limit management and reports it to management and the Risk Management Committee. If the limit of internal capital is expected to be exceeded, the Group’s capital adequacy management is carried out through review and approval by the Risk Management Committee in advance.

62

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

Details of the Group’s capital adequacy ratio in accordance with Basel III requirements as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Total Capital:		36,232,973		35,572,367
Tier 1 Capital		30,963,124		30,491,173
Common Equity Tier 1 Capital		30,089,274		29,916,650
Additional Tier 1 Capital		873,850		574,523
Tier 2 Capital		5,269,849		5,081,194
Risk-Weighted Assets:		207,557,905		203,569,325
Credit risk 1		182,292,999		181,149,126
Market risk 2		12,611,416		10,833,390
Operational risk 3		12,653,490		11,586,809
Total Capital ratio (%):		17.46		17.47
Tier 1 Capital ratio (%)		14.92		14.98
Common Equity Tier 1 Capital ratio (%)		14.50		14.70

¹ Credit risk weighted assets are measured using the Internal Rating-Based Method and Standard Method.

² Market risk weighted assets are measured using the Internal Model-Based Method and Standard Method.

³ Operational risk weighted assets are measured using the Advanced Measurement Method.

63

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

5. Segment Information

5.1 Overall Segment Information and Business Segments

The Group is organized into Corporate Banking, Retail Banking and Other Activities. These segments are based on the nature of the products and services provided, the type or class of customer, and the Group’s management organization.

• Corporate banking: The activities within this segment include providing credit, deposit products, and other related financial services to large, small and medium-sized enterprises and SOHOs and foreign subsidiaries-related works.

• Retail banking: The activities within this segment include providing credit, deposit products, and other related financial services to individuals and households.

• Other activities: The activities within this segment include trading activities in securities and derivatives, funding, trust, and other activities.

Financial information by business segment as of and for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Corporate banking			Retail banking			Others			Consolidation adjustments			Total
Net operating revenues from external customers		5,172,125			4,472,888			9,097			—			9,654,110
Intersegment net operating revenues (expenses)		(174,057	)		—			157,029			17,028			—
		4,998,068			4,472,888			166,126			17,028			9,654,110
Net interest income		4,720,718			3,936,872			631,654			1,777			9,291,021
Interest income		7,831,383			5,763,852			1,864,274			(100,808	)		15,358,701
Interest expense		(3,110,665	)		(1,826,980	)		(1,232,620	)		102,585			(6,067,680	)
Net fee and commission income		385,884			261,350			463,849			(14,475	)		1,096,608
Fee and commission income		546,634			415,858			600,152			(32,486	)		1,530,158
Fee and commission expense		(160,750	)		(154,508	)		(136,303	)		18,011			(433,550	)
Net gains on financial instruments at fair value through profit or loss		73,680			—			244,515			(107,614	)		210,581
Net other operating income (expenses)		(182,214	)		274,666			(1,173,892	)		137,340			(944,100	)
General and administrative expenses		(1,972,147	)		(2,092,770	)		(633,959	)		925			(4,697,951	)
Operating income before provision for credit losses		3,025,921			2,380,118			(467,833	)		17,953			4,956,159
Provision for credit losses		(778,260	)		(281,868	)		11,807			(72,849	)		(1,121,170	)
Net operating income		2,247,661			2,098,250			(456,026	)		(54,896	)		3,834,989
Share of profit of associates		—			—			12,666			—			12,666
Net other non-operating expenses		(13,317	)		—			(5,215	)		(19,333	)		(37,865	)
Segment profit before income tax expense		2,234,344			2,098,250			(448,575	)		(74,229	)		3,809,790
Income tax expense		(732,211	)		(522,478	)		158,696			14,510			(1,081,483	)
Profit for the year		1,502,133			1,575,772			(289,879	)		(59,719	)		2,728,307
Profit attributable to the shareholder of the Parent Company		1,505,240			1,575,772			(289,879	)		204,882			2,996,015
Loss attributable to non-controlling interests		(3,107	)		—			—			(264,601	)		(267,708	)
Total assets *		211,989,036			165,273,848			148,763,232			(8,256,604	)		517,769,512
Total liabilities *		205,382,625			191,786,626			91,870,560			(4,993,558	)		484,046,253

64

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

5.1 Overall Segment Information and Business Segments (cont’d)

	2021
(In millions of Korean won)	Corporate banking			Retail banking			Others			Consolidation adjustments			Total
Net operating revenues from external customers		3,719,822			2,958,198			1,761,432			—			8,439,452
Intersegment net operating revenues (expenses)		(95,647	)		—			65,492			30,155			—
		3,624,175			2,958,198			1,826,924			30,155			8,439,452
Net interest income		3,802,477			3,541,539			388,970			(4,510	)		7,728,476
Interest income		5,317,800			4,437,930			943,600			(24,969	)		10,674,361
Interest expense		(1,515,323	)		(896,391	)		(554,630	)		20,459			(2,945,885	)
Net fee and commission income		390,619			392,060			414,798			(9,596	)		1,187,881
Fee and commission income		534,749			535,530			549,265			(32,600	)		1,586,944
Fee and commission expense		(144,130	)		(143,470	)		(134,467	)		23,004			(399,063	)
Net gains (losses) on financial instruments at fair value through profit or loss		29,407			—			316,537			(3,110	)		342,834
Net other operating income (expenses)		(598,328	)		(975,401	)		706,619			47,371			(819,739	)
General and administrative expenses		(1,831,948	)		(2,036,855	)		(535,382	)		1,454			(4,402,731	)
Operating income before provision for credit losses		1,792,227			921,343			1,291,542			31,609			4,036,721
Provision for credit losses		(392,956	)		(125,876	)		(4,294	)		398			(522,728	)
Net operating income		1,399,271			795,467			1,287,248			32,007			3,513,993
Share of loss of associates		—			—			57,156			—			57,156
Net other non-operating income		(9,237	)		—			(52,812	)		(17,556	)		(79,605	)
Segment profit before income tax expense		1,390,034			795,467			1,291,592			14,451			3,491,544
Income tax expense		(368,577	)		(218,753	)		(317,138	)		(49,047	)		(953,515	)
Profit for the year		1,021,457			576,714			974,454			(34,596	)		2,538,029
Profit attributable to the shareholder of the Parent Company		1,022,699			576,714			974,454			16,897			2,590,764
Profit attributable to non-controlling interests		(1,242	)		—			—			(51,493	)		(52,735	)
Total assets *		189,310,448			169,513,344			131,447,842			(6,706,736	)		483,564,898
Total liabilities *		197,834,530			180,815,013			75,034,139			(3,007,697	)		450,675,985

* Assets and liabilities of the reporting segments are amounts before intersegment transactions.

65

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

5.2 Services and Geographical Segments

5.2.1 Services information

Net operating revenues from external customers by service for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Corporate banking service		5,172,125		3,719,822
Retail banking service		4,472,888		2,958,198
Others		9,097		1,761,432
		9,654,110		8,439,452

5.2.2 Geographical information

Geographical net operating revenues from external customers for the years ended December 31, 2022 and 2021, and major non-current assets as of December 31, 2022 and 2021, are as follows:

	Net operating revenues from external customers					Major non-current assets
(In millions of Korean won)	2022			2021		December 31, 2022		December 31, 2021
Domestic		8,769,566			7,768,786		4,331,433		4,385,855
United States		71,327			37,332		14,485		7,009
New Zealand		12,378			12,857		1,382		1,932
China		150,024			110,251		18,429		19,320
Japan		18,939			17,482		1,480		2,019
Myanmar		6,360			5,140		1,736		2,993
Vietnam		25,409			10,185		2,159		2,132
Cambodia		514,222			390,383		33,581		29,545
United Kingdom		30,430			23,571		5,808		885
Singapore		(3,149	)		—		8,492		—
Indonesia		57,556			57,635		319,033		360,556
India		1,048			5,830		394		839
Consolidation adjustments		—			—		498,951		474,417
		9,654,110			8,439,452		5,237,363		5,287,502

66

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6. Financial Assets and Financial Liabilities

6.1 Classification and Fair Value of Financial Instruments

6.1.1 Carrying amount and fair value of financial assets and liabilities by category as of December 31, 2022 and 2021, are as follows:

	December 31, 2022				December 31, 2021
(In millions of Korean won)	Carrying amount		Fair value		Carrying amount		Fair value
Financial assets
Cash and due from financial institutions		25,127,794		25,120,077		25,164,991		25,164,936
Financial assets at fair value through profit or loss:		21,213,408		21,213,408		18,834,364		18,834,364
Debt securities		20,756,579		20,756,579		18,513,088		18,513,088
Equity securities		217,748		217,748		113,724		113,724
Loans		149,075		149,075		93,930		93,930
Others		90,006		90,006		113,622		113,622
Derivatives held for trading		7,529,366		7,529,366		2,835,202		2,835,202
Derivatives held for hedging		238,226		238,226		130,424		130,424
Loans measured at amortized cost		374,671,976		372,232,275		361,144,701		361,047,763
Financial assets at fair value through other comprehensive income:		40,013,375		40,013,375		41,580,315		41,580,315
Debt securities		38,363,832		38,363,832		38,140,906		38,140,906
Equity securities		1,418,522		1,418,522		3,169,800		3,169,800
Loans		231,021		231,021		269,609		269,609
Securities measured at amortized cost		35,236,794		33,418,180		22,164,594		21,880,536
Other financial assets		6,709,627		6,709,627		5,277,227		5,277,227
		510,740,566		506,474,534		477,131,818		476,750,767
Financial liabilities
Financial liabilities at fair value through profit or loss		108,862		108,862		112,698		112,698
Derivatives held for trading		7,166,578		7,166,578		2,706,941		2,706,941
Derivatives held for hedging		104,856		104,856		42,471		42,471
Deposits		381,746,749		381,288,577		363,141,416		363,049,803
Borrowings		45,073,117		44,746,350		32,523,161		32,447,493
Debentures		29,787,722		29,611,888		29,718,734		29,780,948
Other financial liabilities		17,376,336		17,376,336		19,715,198		19,715,198
		481,364,220		480,403,447		447,960,619		447,855,552

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Group discloses the fair value of each class of assets and liabilities in a way that permits it to be compared with its carrying amount at the end of each reporting period. The best evidence of fair value of financial instruments is a quoted price in an active market.

67

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

Methods of determining fair value of financial instruments are as follows:

Cash and due from financial institutions	Fair value of cash is same as carrying amount. Carrying amount of demand deposit and settlement deposit is a reasonable approximation of fair value because these financial instruments do not have a fixed maturity and are receivable on demand. Fair value of general deposit is measured using Discounted Cash Flow (“DCF”) Model.
Securities, Due from financial institutions and deposits indexed to gold price	Fair value of securities and others that are traded in an active market and due from financial institutions and deposits indexed to gold price is determined using the quoted prices. If there is no quoted price, fair value is determined using external professional valuation institutions. The institutions use one or more valuation techniques that are deemed appropriate considering the characteristics of the financial instruments among DCF Model, MonteCarlo Simulation, Free Cash Flow to Equity Model, Comparable Company Analysis, Dividend Discount Model, and Net Asset Value Method.
Loans	Fair value of loans is determined using DCF Model and independent external professional valuation institutions. Fair value measured by DCF Model is determined by discounting the expected cash flows, which are contractual cash flows adjusted by the expected prepayment rate, at an appropriate discount rate.
Derivatives	Fair value of exchange traded derivatives is determined using quoted price in an active market, and fair value of OTC derivatives is determined using valuation techniques. The Group uses internally developed valuation models that are widely used by market participants to determine fair value of plain vanilla OTC derivatives including options, interest rate swaps, and currency swaps, based on observable market parameters. However, some complex financial instruments are valued using appropriate models developed from generally accepted market valuation models including Finite Difference Method (“FDM”), MonteCarlo Simulation, and Tree Model or valuation results from independent external professional valuation institutions. For OTC derivatives, the credit risk of counterparty and the Group’s own credit risk are applied through credit valuation adjustment method.
Deposits	Carrying amount of demand deposits is a reasonable approximation of fair value because they do not have a fixed maturity and are payable on demand. Fair value of time deposits is determined using DCF Model discounting the expected cash flows, which are contractual cash flows adjusted by the expected prepayment rate, at an appropriate discount rate.
Borrowings	Carrying amount of overdrafts in foreign currency is a reasonable approximation of fair value because they do not have a fixed maturity and are payable on demand. Fair value of other borrowings is determined using DCF Model.
Debentures	Fair value is determined using valuation results (DCF Model) of external professional valuation institutions, which are calculated using market inputs.
Other financial assets and other financial liabilities	Carrying amount is a reasonable approximation of fair value because other financial assets and other financial liabilities are temporary accounts used for other various transactions and their maturities are relatively short or not defined.

68

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.1.2 Fair value hierarchy

The Group believes that valuation techniques used for measuring the fair value of financial instruments are reasonable and that the fair value recognized in the consolidated statement of financial position is appropriate. However, the fair value of the financial instruments recognized in the consolidated statement of financial position may be different if other valuation techniques or assumptions are used. Additionally, as there are a variety of valuation techniques and assumptions used in measuring fair value, it may be difficult to reasonably compare the fair value with that of other financial institutions.

The Group classifies and discloses fair value of the financial instruments into the three fair value levels as follows:

Level 1:	The fair values are based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.
Level 2	The fair values are based on inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3:	The fair values are based on unobservable inputs for the asset or liability.

The fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. If an observable input requires an adjustment using an unobservable input and that adjustment results in a significantly higher or lower fair value measurement, the resulting measurement would be categorized within Level 3 of the fair value hierarchy.

69

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.1.2.1 Fair value hierarchy of financial assets and liabilities at fair value in the consolidated statements of financial position

Fair value hierarchy of financial assets and liabilities at fair value in the consolidated statements of financial position as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	Fair value hierarchy
(In millions of Korean won)	Level 1		Level 2		Level 3		Total
Financial assets
Financial assets at fair value through profit or loss:		7,216,086		9,613,485		4,383,837		21,213,408
Debt securities		7,059,911		9,613,485		4,083,183		20,756,579
Equity securities		66,169		—		151,579		217,748
Loans		—		—		149,075		149,075
Others		90,006		—		—		90,006
Derivatives held for trading		—		7,529,333		33		7,529,366
Derivatives held for hedging		—		238,226		—		238,226
Financial assets at fair value through other comprehensive income:		11,855,563		27,352,216		805,596		40,013,375
Debt securities		11,242,637		27,121,195		—		38,363,832
Equity securities		612,926		—		805,596		1,418,522
Loans		—		231,021		—		231,021
		19,071,649		44,733,260		5,189,466		68,994,375
Financial liabilities
Financial liabilities at fair value through profit or loss		108,862		—		—		108,862
Derivatives held for trading		—		7,166,128		450		7,166,578
Derivatives held for hedging		—		104,856		—		104,856
		108,862		7,270,984		450		7,380,296

	December 31, 2021
	Fair value hierarchy
(In millions of Korean won)	Level 1		Level 2		Level 3		Total
Financial assets
Financial assets at fair value through profit or loss:		4,085,766		11,434,023		3,314,575		18,834,364
Debt securities		3,910,659		11,434,023		3,168,406		18,513,088
Equity securities		61,485		—		52,239		113,724
Loans		—		—		93,930		93,930
Others		113,622		—		—		113,622
Derivatives held for trading		—		2,835,141		61		2,835,202
Derivatives held for hedging		—		130,424		—		130,424
Financial assets at fair value through other comprehensive income:		11,823,832		28,907,384		849,099		41,580,315
Debt securities		9,503,131		28,637,775		—		38,140,906
Equity securities		2,320,701		—		849,099		3,169,800
Loans		—		269,609		—		269,609
		15,909,598		43,306,972		4,163,735		63,380,305
Financial liabilities
Financial liabilities at fair value through profit or loss		112,698		—		—		112,698
Derivatives held for trading		—		2,706,549		392		2,706,941
Derivatives held for hedging		—		42,471		—		42,471
		112,698		2,749,020		392		2,862,110

70

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

Valuation techniques and inputs of financial assets and liabilities classified as Level 2 and measured at fair value in the consolidated statements of financial position as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Fair value		Valuation techniques	Inputs
Financial assets
Financial assets at fair value through profit or loss:		9,613,485
Debt securities		9,613,485	DCF Model, MonteCarlo Simulation, Net Asset Value Method	Discount rate, interest rate, prices of underlying assets (debt securities, stocks, etc.)
Derivatives held for trading		7,529,333	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, stock price, and others
Derivatives held for hedging		238,226	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, and others
Financial assets at fair value through other comprehensive income:		27,352,216
Debt securities		27,121,195	DCF Model	Discount rate
Loans		231,021	DCF Model	Discount rate
		44,733,260
Financial liabilities
Derivatives held for trading		7,166,128	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, stock price, and others
Derivatives held for hedging		104,856	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, and others
		7,270,984

	December 31, 2021
(In millions of Korean won)	Fair value		Valuation techniques	Inputs
Financial assets
Financial assets at fair value through profit or loss:		11,434,023
Debt securities		11,434,023	DCF Model, MonteCarlo Simulation, Net Asset Value Method	Discount rate, interest rate, prices of underlying assets (debt securities, stocks, etc.)
Derivatives held for trading		2,835,141	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, stock price, and others
Derivatives held for hedging		130,424	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, and others
Financial assets at fair value through other comprehensive income:		28,907,384
Debt securities		28,637,775	DCF Model	Discount rate
Loans		269,609	DCF Model	Discount rate
		43,306,972
Financial liabilities
Derivatives held for trading		2,706,549	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, stock price, and others
Derivatives held for hedging		42,471	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, and others
		2,749,020

71

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.1.2.2 Fair value hierarchy of financial assets and liabilities whose fair value is disclosed

Fair value hierarchy of financial assets and liabilities whose fair value is disclosed as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	Fair value hierarchy
(In millions of Korean won)	Level 1		Level 2		Level 3		Total
Financial assets
Cash and due from financial institutions 1		2,560,519		20,223,592		2,335,966		25,120,077
Loans measured at amortized cost		—		—		372,232,275		372,232,275
Securities measured at amortized cost		5,087,917		28,330,263		—		33,418,180
Other financial assets 2		—		—		6,709,627		6,709,627
		7,648,436		48,553,855		381,277,868		437,480,159
Financial liabilities
Deposits 1		—		164,003,100		217,285,477		381,288,577
Borrowings 1		—		18,271		44,728,079		44,746,350
Debentures		—		29,611,888		—		29,611,888
Other financial liabilities 2		—		—		17,376,336		17,376,336
		—		193,633,259		279,389,892		473,023,151

	December 31, 2021
	Fair value hierarchy
(In millions of Korean won)	Level 1		Level 2		Level 3		Total
Financial assets
Cash and due from financial institutions 1		2,644,591		20,973,023		1,547,322		25,164,936
Loans measured at amortized cost		—		—		361,047,763		361,047,763
Securities measured at amortized cost		2,712,403		19,168,133		—		21,880,536
Other financial assets 2		—		—		5,277,227		5,277,227
		5,356,994		40,141,156		367,872,312		413,370,462
Financial liabilities
Deposits 1		—		197,274,176		165,775,627		363,049,803
Borrowings 1		—		2,146		32,445,347		32,447,493
Debentures		—		29,780,948		—		29,780,948
Other financial liabilities 2		—		—		19,715,198		19,715,198
		—		227,057,270		217,936,172		444,993,442

¹ The amounts included in Level 2 are the carrying amounts which are reasonable approximations of fair value.

² Other financial assets and other financial liabilities included in Level 3 are the carrying amounts which are reasonable approximations of fair value.

72

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

For financial assets and liabilities whose carrying amount is a reasonable approximation of fair value, valuation techniques and inputs are not disclosed.

Valuation techniques and inputs of financial assets and liabilities classified as Level 2, and whose fair value is disclosed as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Fair value		Valuation techniques	Inputs
Financial assets
Securities measured at amortized cost		28,330,263	DCF Model, MonteCarlo Simulation	Discount rate, interest rate
Financial liabilities
Debentures		29,611,888	DCF Model	Discount rate

	December 31, 2021
(In millions of Korean won)	Fair value		Valuation techniques	Inputs
Financial assets
Securities measured at amortized cost		19,168,133	DCF Model, MonteCarlo Simulation	Discount rate, interest rate
Financial liabilities
Debentures		29,780,948	DCF Model	Discount rate

73

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

Valuation techniques and inputs of financial assets and liabilities classified as Level 3, and whose fair value is disclosed as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Fair value		Valuation techniques		Inputs	Unobservable inputs
Financial assets
Cash and due from financial institutions		2,335,966		DCF Model	Credit spread, other spread, interest rate		Credit spread, other spread
Loans measured at amortized cost		372,232,275		DCF Model	Credit spread, other spread, prepayment rate, interest rate		Credit spread, other spread, prepayment rate
		374,568,241
Financial liabilities
Deposits		217,285,477		DCF Model	Other spread, prepayment rate, interest rate		Other spread, prepayment rate
Borrowings		44,728,079		DCF Model	Other spread, interest rate		Other spread
		262,013,556

	December 31, 2021
(In millions of Korean won)	Fair value		Valuation techniques		Inputs	Unobservable inputs
Financial assets
Cash and due from financial institutions		1,547,322		DCF Model	Credit spread, other spread, interest rate		Credit spread, other spread
Loans measured at amortized cost		361,047,763		DCF Model	Credit spread, other spread, prepayment rate, interest rate		Credit spread, other spread, prepayment rate
		362,595,085
Financial liabilities
Deposits		165,775,627		DCF Model	Other spread, prepayment rate, interest rate		Other spread, prepayment rate
Borrowings		32,445,347		DCF Model	Other spread, interest rate		Other spread
		198,220,974

6.2 Disclosure of Fair Value Hierarchy Level 3

6.2.1 Valuation policy and process of Level 3 fair value

The Group uses external, independent and qualified valuation service in addition to internal valuation models to determine the fair value of financial instruments at the end of every reporting period.

If the changes in situation and events which cause transfers between the fair value hierarchy level for a financial asset or liability occur, the Group’s policy is to recognize such transfers as having occurred at the beginning of the reporting period.

74

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.2.2 Changes in fair value (Level 3) measured using valuation technique based on unobservable inputs in the market

6.2.2.1 Changes in financial instruments classified as Level 3 of the fair value hierarchy for the years ended December 31, 2022 and 2021, are as follows:

	2022
	Financial assets at fair value through profit or loss						Financial investments			Net derivative financial instruments
(In millions of Korean won)	Securities measured at fair value through profit or loss			Loans measured at fair value through profit or loss			Equity securities measured at fair value through other comprehensive income			Derivatives held for trading			Derivatives held for hedging
Beginning		3,220,645			93,930			849,099			(331	)		—
Total gains or losses:
- Profit or loss		117,562			20,306			—			(86	)		—
- Other comprehensive loss		—			—			(47,055	)		—			—
Purchases		1,303,168			45,487			4,093			—			—
Sales		(406,613	)		(10,648	)		(541	)		—			—
Ending		4,234,762			149,075			805,596			(417	)		—

	2021
	Financial assets at fair value through profit or loss						Financial investments			Net derivative financial instruments
(In millions of Korean won)	Securities measured at fair value through profit or loss			Loans measured at fair value through profit or loss			Equity securities measured at fair value through other comprehensive income			Derivatives held for trading			Derivatives held for hedging
Beginning		2,233,598			38,756			1,917,980			(63	)		—
Total gains or losses:
- Profit or loss		120,852			(431	)		—			(203	)		—
- Other comprehensive income		—			—			(139,455	)		—			—
Purchases		1,354,851			55,605			23,507			2			—
Sales		(488,656	)		—			(484	)		(67	)		—
Transfers into Level 3		—			—			(952,449	)		—			—
Ending		3,220,645			93,930			849,099			(331	)		—

75

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.2.2.2 In relation to changes in financial instruments classified as Level 3 of the fair value hierarchy, total gains or losses recognized in profit or loss for the period, and total gains or losses recognized in profit or loss from financial instruments held at the end of the reporting period for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Net gains on financial instruments at fair value through profit or loss		Other operating income		Net interest income
Total gains recognized in profit or loss for the period		71,695		66,087		—
Total gains recognized in profit or loss from financial instruments held at the end of the reporting period		62,419		17,174		—

	2021
(In millions of Korean won)	Net gains on financial instruments at fair value through profit or loss		Other operating expenses		Net interest income
Total gains recognized in profit or loss for the period		102,758		17,460		—
Total gains recognized in profit or loss from financial instruments held at the end of the reporting period		132,034		16,989		—

76

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.2.3 Sensitivity analysis of changes in unobservable inputs

6.2.3.1 Information about fair value measurements using unobservable inputs as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)
	December 31, 2022
	Fair value		Valuation techniques	Inputs	Unobservable inputs	Range of unobservable inputs (%)		Relationship of unobservable inputs to fair value
Financial assets
Financial assets at fair value through profit or loss:
Debt securities		4,083,183	MonteCarlo Simulation, Net Asset Value Method, DCF Model, Tree Model	Price of underlying asset, interest rate, dividend yield, discount rate, liquidation value, rate of real estate sale price fluctuation, stock price, volatility of stock price	Volatility of underlying asset		23.97 ~ 26.52	Higher the volatility, higher the fair value fluctuation
					Correlation coefficient		22.85	The higher the correlation coefficient, the higher the fair value fluctuation
					Discount rate		8.53	Lower the discount rate, higher the fair value
					Liquidation value		0.00	Higher the liquidation value, higher the fair value
					Rate of real estate sale price fluctuation		0.00	Higher the real estate sale price, higher the fair value
					Volatility of stock price		21.83 ~ 34.51	Higher the volatility, higher the fair value fluctuation
Equity securities		151,579	DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method	Growth rate, discount rate	Growth rate		0.00	Higher the growth rate, higher the fair value
					Discount rate		9.16 ~ 15.82	Lower the discount rate, higher the fair value
Loans		149,075	DCF Model	Discount rate	Discount rate		9.91	Lower the discount rate, higher the fair value
Derivatives held for trading:
Stock and index		33	Tree Model	Price of underlying asset, volatility of underlying asset	Volatility of underlying asset		21.83 ~ 31.73	Higher the volatility, higher the fair value fluctuation
Financial assets at fair value through other comprehensive income:
Equity securities		805,596	DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method, Tree Model	Growth rate, discount rate, stock price, volatility of stock price	Growth rate		0.00 ~ 1.00	Higher the growth rate, higher the fair value
					Discount rate		9.08 ~ 19.14	Lower the discount rate, higher the fair value
					Volatility of stock price		24.88 ~28.62	Higher the volatility, higher the fair value fluctuation
		5,189,466
Financial liabilities
Derivatives held for trading:
Others		450	DCF Model	Interest rate, discount rate	Discount rate		4.83 ~ 6.85	Higher the discount rate, lower the fair value
		450

77

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.2.3.1 Information about fair value measurements using unobservable inputs as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021
(In millions of Korean won)	Fair value		Valuation techniques	Inputs	Unobservable inputs	Range of unobservable inputs (%)		Relationship of unobservable inputs to fair value
Financial assets
Financial assets at fair value through profit or loss:
Debt securities		3,168,406	MonteCarlo Simulation, Net Asset Value Method, DCF Model, Tree Model	Price of underlying asset, interest rate, dividend yield, discount rate, liquidation value, rate of real estate sale price fluctuation, stock price, volatility of stock price	Discount rate		8.17 ~ 21.37	Lower the discount rate, higher the fair value
					Liquidation value		0.00	Higher the liquidation value, higher the fair value
					Rate of real estate sale price fluctuation		0.00	Higher the real estate sale price, higher the fair value
					Volatility of stock price		18.87 ~ 19.48	Higher the volatility, higher the fair value fluctuation
Equity securities		52,239	DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method	Growth rate, discount rate	Growth rate		0.00 ~ 1.00	Higher the growth rate, higher the fair value
					Discount rate		10.76 ~ 22.79	Lower the discount rate, higher the fair value
Loans		93,930	DCF Model	Discount rate	Discount rate		8.21	Lower the discount rate, higher the fair value
Derivatives held for trading:
Stock and index		61	Tree Model	Price of underlying asset, volatility of underlying asset	Volatility of underlying asset		17.00 ~ 25.49	Higher the volatility, higher the fair value fluctuation
Financial assets at fair value through other comprehensive income:
Equity securities		849,099	DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method, Tree Model	Growth rate, discount rate, stock price, volatility of stock price	Growth rate		0.00 ~ 1.00	Higher the growth rate, higher the fair value
					Discount rate		10.42 ~ 18.02	Lower the discount rate, higher the fair value
					Volatility of stock price		23.36 ~ 25.49	Higher the volatility, higher the fair value fluctuation
		4,163,735
Financial liabilities
Derivatives held for trading:
Others		392	DCF Model	Interest rate, discount rate	Discount rate		1.46 ~ 2.83	Higher the discount rate, lower the fair value
		392

78

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.2.3.2 Sensitivity analysis of changes in unobservable inputs

Sensitivity analysis of financial instruments is performed to measure favorable and unfavorable changes in fair value of financial instruments which are affected by unobservable parameters, using a statistical technique. When the fair value is affected by more than one input parameter, the amounts represent the most favorable or most unfavorable outcome. Level 3 financial instruments subject to sensitivity analysis are debt securities, loans, equity-related derivatives, currency-related derivatives, interest rate-related derivatives, and other derivatives whose fair value changes are recognized in profit or loss as well as equity securities whose fair value changes are recognized in profit or loss or other comprehensive income or loss.

Results of the sensitivity analysis of changes in unobservable inputs as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	Profit or loss					Other comprehensive income or loss
(In millions of Korean won)	Favorable changes		Unfavorable changes			Favorable changes		Unfavorable changes
Financial assets
Financial assets at fair value through profit or loss:
Debt securities 3, 5		6,140		(6,383	)		—		—
Equity securities 2, 5		8,629		(5,033	)		—		—
Loans 4		2,277		(2,054	)		—		—
Derivatives held for trading 1		2		(2	)		—		—
Financial assets at fair value through other comprehensive income:
Equity securities 2, 5, 6		—		—			137,984		(56,900	)
		17,048		(13,472	)		137,984		(56,900	)
Financial liabilities
Derivatives held for trading 1		72		(72	)		—		—
		72		(72	)		—		—

79

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.2.3.2 Sensitivity analysis of changes in unobservable inputs (cont’d)

	December 31, 2021
	Profit or loss					Other comprehensive income or loss
(In millions of Korean won)	Favorable changes		Unfavorable changes			Favorable changes		Unfavorable changes
Financial assets
Financial assets at fair value through profit or loss:
Debt securities 3, 5		7,065		(7,001	)		—		—
Equity securities 2, 5		5,698		(4,328	)		—		—
Loans 4		3,062		(2,742	)		—		—
Derivatives held for trading 1		2		—			—		—
Financial assets at fair value through other comprehensive income:
Equity securities 2, 5, 6		—		—			87,021		(65,000	)
		15,827		(14,071	)		87,021		(65,000	)
Financial liabilities
Derivatives held for trading 1		196		(204	)		—		—
		196		(204	)		—		—

¹ For derivative financial instruments, changes in fair value are calculated by shifting principal unobservable input parameters such as price and the volatility of underlying asset by ± 10%.

² For equity securities, changes in fair value are calculated by shifting principal unobservable input parameters such as discount rate (-1%p~1%p) and growth rate (0%p~1%p).

³ For beneficiary certificates, it is practically impossible to analyze sensitivity of changes in unobservable inputs. However, for beneficiary certificates whose underlying assets are real estates, changes in fair value are calculated by shifting rate of real estate sale price fluctuation (-1%p~1%p), and for beneficiary certificates whose underlying assets are equity investments, changes in fair value are calculated by shifting liquidation value (-1%p~1%p) and discount rate (-1%p~1%p). There is no significant correlation among major unobservable inputs.

⁴  For loans, changes in fair value are calculated by shifting principal unobservable input parameters such as discount rate (-1%p~1%p).

⁵  The amounts of \ 3,989,635 million and \ 3,175,985 million of financial assets classified as level 3 as of December 31, 2022 and 2021, respectively, are excluded because it is practically impossible to analyze sensitivity of changes in unobservable inputs.

⁶  For some equity securities, changes in fair value are calculated by shifting principal unobservable input parameters such as stock price and volatility of stock price by ±10%.

80

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.2.4 Day one gains or losses

When the Group measures the fair value of OTC derivatives using inputs that are not based on observable market data, there could be a difference between the transaction price and the amount determined using that valuation technique. In these circumstances, the fair value of financial instruments is recognized as the transaction price, and the difference is not recognized in profit or loss but deferred and amortized using the straight-line method over the life of the financial instrument. When the fair value of the financial instruments is subsequently determined using observable market inputs, the remaining deferred amount is recognized in profit or loss.

Changes in deferred day one gains or losses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Balance at the beginning of the year (A)		(8,719	)		(637	)
New transactions (B)		(105	)		(10,032	)
Amounts recognized in profit or loss (C=a+b)		2,078			1,950
a. Amortization		2,078			1,950
b. Settlement		—			—
Balance at the end of the year (A+B+C)		(6,746	)		(8,719	)

6.3 Carrying Amount of Financial Instruments by Category

Financial assets and liabilities are measured at fair value or amortized cost. Carrying amount of financial assets and liabilities by category as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Financial instruments at fair value through profit or loss		Financial instruments at fair value through other comprehensive income		Financial instruments designated at fair value through other comprehensive income		Financial instruments at amortized cost		Derivatives held for hedging		Total
Financial assets
Cash and due from financial institutions		—		—		—		25,127,794		—		25,127,794
Financial assets at fair value through profit or loss		21,213,408		—		—		—		—		21,213,408
Derivative financial assets		7,529,366		—		—		—		238,226		7,767,592
Loans measured at amortized cost		—		—		—		374,671,976		—		374,671,976
Financial investments		—		38,594,853		1,418,522		35,236,794		—		75,250,169
Other financial assets		—		—		—		6,709,627		—		6,709,627
		28,742,774		38,594,853		1,418,522		441,746,191		238,226		510,740,566

81

Kookmin Bank Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.3 Carrying Amount of Financial Instruments by Category (cont’d)

	December 31, 2022
(In millions of Korean won)	Financial instruments at fair value through profit or loss		Financial instruments at amortized cost		Derivatives held for hedging		Total
Financial liabilities
Financial liabilities at fair value through profit or loss		108,862		—		—		108,862
Derivative financial liabilities		7,166,578		—		104,856		7,271,434
Deposits		—		381,746,749		—		381,746,749
Borrowings		—		45,073,117		—		45,073,117
Debentures		—		29,787,722		—		29,787,722
Other financial liabilities		—		17,376,336		—		17,376,336
		7,275,440		473,983,924		104,856		481,364,220

	December 31, 2021
(In millions of Korean won)	Financial instruments at fair value through profit or loss		Financial instruments at fair value through other comprehensive income		Financial instruments designated at fair value through other comprehensive income		Financial instruments at amortized cost		Derivatives held for hedging		Total
Financial assets
Cash and due from financial institutions		—		—		—		25,164,991		—		25,164,991
Financial assets at fair value through profit or loss		18,834,364		—		—		—		—		18,834,364
Derivative financial assets		2,835,202		—		—		—		130,424		2,965,626
Loans measured at amortized cost		—		—		—		361,144,701		—		361,144,701
Financial investments		—		38,410,515		3,169,800		22,164,594		—		63,744,909
Other financial assets		—		—		—		5,277,227		—		5,277,227
		21,669,566		38,410,515		3,169,800		413,751,513		130,424		477,131,818

	December 31, 2021
(In millions of Korean won)	Financial instruments at fair value through profit or loss		Financial instruments at amortized cost		Derivatives held for hedging		Total
Financial liabilities
Financial liabilities at fair value through profit or loss		112,698		—		—		112,698
Derivative financial liabilities		2,706,941		—		42,471		2,749,412
Deposits		—		363,141,416		—		363,141,416
Borrowings		—		32,523,161		—		32,523,161
Debentures		—		29,718,734		—		29,718,734
Other financial liabilities		—		19,715,198		—		19,715,198
		2,819,639		445,098,509		42,471		447,960,619

82

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.4 Transfer of Financial Assets

6.4.1 Transferred financial assets that are derecognized in their entirety

The Group transferred loans and other financial assets to companies specialized in asset-backed securitization and derecognized them from the consolidated financial statement, while the maximum exposure to loss (carrying amount) from its continuing involvement and fair value of its continuing involvement of the derecognized financial assets as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Type of continuing involvement	Classification of financial instruments	Carrying amount of continuing involvement		Fair value of continuing involvement
Discovery 2nd Securitization Specialty Co., Ltd.	Subordinated bond	Financial assets at fair value through profit or loss		564		564
AP 4D ABS Ltd.	Subordinated bond	Financial assets at fair value through profit or loss		541		541
				1,105		1,105
	December 31, 2021
(In millions of Korean won)	Type of continuing involvement	Classification of financial instruments	Carrying amount of continuing involvement		Fair value of continuing involvement
Discovery 2nd Securitization Specialty Co., Ltd.	Subordinated bond	Financial assets at fair value through profit or loss		5,189		5,189
AP 4D ABS Ltd.	Subordinated bond	Financial assets at fair value through profit or loss		5,463		5,463
				10,652		10,652

83

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.4.2 Bonds sold under repurchase agreements and loaned securities

The Group continues to recognize the financial assets related to bonds sold under repurchase agreements and securities lending transactions in the consolidated statement of financial position since those transactions are not qualified for derecognition even though the Group transfers the financial assets. Bonds sold under repurchase agreements are sold on the condition that they will be repurchased at a fixed price and loaned securities will be returned at the expiration of the loan period. Thus, the Group retains substantially all the risks and rewards of ownership of the financial assets.

The carrying amount of transferred assets and related liabilities as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Carrying amount of transferred assets		Carrying amount of related liabilities
Bonds sold under repurchase agreements		5,459,045		4,930,104
Loaned securities:
Government and public bonds		239,132		—
		5,698,177		4,930,104
	December 31, 2021
(In millions of Korean won)	Carrying amount of transferred assets		Carrying amount of related liabilities
Bonds sold under repurchase agreements		860,565		832,352
Loaned securities:
Government and public bonds		49,816		—
		910,381		832,352

6.4.3 Purchase commitments of securitized debentures

The Group provided additional credit enhancement, such as purchase commitments, for the underlying assets of subsidiaries established for asset-backed securitization. Details of carrying amounts of the underlying assets and the associated liabilities as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Underlying assets	Financial assets at fair value through profit or loss		15,442		119,710
	Loans measured at amortized cost *		1,167,244		2,357,972
			1,182,686		2,477,682
Associated liabilities	Debentures		1,182,844		2,476,072

* Before netting of allowance

84

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.5 Offsetting Financial Assets and Financial Liabilities

The Group enters into International Swaps and Derivatives Association (“ISDA”) master netting agreements and other similar arrangements with the Group’s OTC derivative and spot exchange counterparties. Similar netting agreements are also entered into with the Group’s (a) sales or purchases of bonds under repurchase agreements and (b) securities lending and borrowing transactions, etc. Pursuant to these agreements, in the event of default by one party, contracts are to be terminated and receivables and payables are to be offset. As the Group has the legal right of offset and settles in net amount, domestic exchange settlement debits and domestic exchange settlement credits are recognized in its net settlement balance in the consolidated statement of financial position. Other financial instruments such as account receivables and account payables related to listed securities, and derivatives or OTC derivatives settled by the central clearing house are also recognized in its net settlement balance in the consolidated statement of financial position as the Group has the legal right of offset and settles in net amount.

6.5.1 Details of financial assets subject to enforceable master netting agreements or similar arrangements as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	Gross assets		Gross liabilities offset			Net amount in the statement of financial position		Non-offsetting amount						Net amount
(In millions of Korean won)								Financial instruments			Cash collateral
Derivatives held for trading		7,529,334		—			7,529,334		(6,367,793	)		(826	)		1,398,941
Derivatives held for hedging		238,226		—			238,226
Unsettled spot exchange receivable		3,368,979		—			3,368,979		(3,355,280	)		—			13,699
Bonds purchased under repurchase agreements		2,281,357		—			2,281,357		(2,281,357	)		—			—
Domestic exchange settlement debits		55,446,595		(54,584,853	)		861,742		—			—			861,742
Other financial instruments		20,283		(15,143	)		5,140		—			—			5,140
		68,884,774		(54,599,996	)		14,284,778		(12,004,430	)		(826	)		2,279,522
	December 31, 2021
	Gross assets		Gross liabilities offset			Net amount in the statement of financial position		Non-offsetting amount						Net amount
(In millions of Korean won)								Financial instruments			Cash collateral
Derivatives held for trading		2,835,141		—			2,835,141		(1,810,195	)		(5	)		1,155,365
Derivatives held for hedging		130,424		—			130,424
Unsettled spot exchange receivable		2,353,879		—			2,353,879		(2,349,893	)		—			3,986
Bonds purchased under repurchase agreements		5,508,594		—			5,508,594		(5,508,594	)		—			—
Domestic exchange settlement debits		43,372,672		(42,383,120	)		989,552		—			—			989,552
Other financial instruments		20,728		(20,377	)		351		—			—			351
		54,221,438		(42,403,497	)		11,817,941		(9,668,682	)		(5	)		2,149,254

85

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

6.5.2 Details of financial liabilities subject to enforceable master netting agreements or similar arrangements as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	Gross liabilities		Gross assets offset			Net amount in the statement of financial position		Non-offsetting amount					Net amount
(In millions of Korean won)								Financial instruments			Cash collateral
Derivatives held for trading		7,166,128		—			7,166,128		(4,925,667	)		—		2,345,317
Derivatives held for hedging		104,856		—			104,856
Unsettled spot exchange payable		3,368,837		—			3,368,837		(3,355,280	)		—		13,557
Bonds sold under repurchase agreements *		4,948,293		—			4,948,293		(4,948,293	)		—		—
Domestic exchange settlement credits		56,319,757		(54,584,853	)		1,734,904		(1,734,904	)		—		—
Other financial instruments		15,212		(15,143	)		69		—			—		69
		71,923,083		(54,599,996	)		17,323,087		(14,964,144	)		—		2,358,943
	December 31, 2021
	Gross liabilities		Gross assets offset			Net amount in the statement of financial position		Non-offsetting amount					Net amount
(In millions of Korean won)								Financial instruments			Cash collateral
Derivatives held for trading		2,706,548		—			2,706,548		(2,019,139	)		—		729,880
Derivatives held for hedging		42,471		—			42,471
Unsettled spot exchange payable		2,352,736		—			2,352,736		(2,349,893	)		—		2,843
Bonds sold under repurchase agreements *		832,352		—			832,352		(832,352	)		—		—
Domestic exchange settlement credits		47,504,809		(42,383,120	)		5,121,689		(5,121,689	)		—		—
Other financial instruments		23,363		(20,377	)		2,986		—			—		2,986
		53,462,279		(42,403,497	)		11,058,782		(10,323,073	)		—		735,709

* Includes bonds sold under repurchase agreements to customers.

86

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

7. Due from Financial Institutions

7.1 Details of due from financial institutions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		Financial institutions	Interest rate (%)	December 31, 2022		December 31, 2021
Due from financial institutions in Korean won	Due from the Bank of Korea	The Bank of Korea	—		15,169,704		15,317,033
	Due from banks	Hana Bank and others	0.00 ~ 2.76		377,655		159,059
	Due from others	KB Securities Co., Ltd. and others	0.00 ~ 4.35		24,152		20,732
					15,571,511		15,496,824
Due from financial institutions in foreign currencies	Due from banks in foreign currencies	The Bank of Korea and others	0.00 ~ 4.00		5,559,644		6,252,882
	Time deposits in foreign currencies	Bank of Communications, Seoul and others	0.00 ~ 6.80		458,225		389,320
	Due from others	Morgan Stanley and others	0.00 ~ 6.00		979,771		383,502
					6,997,640		7,025,704
					22,569,151		22,522,528

* Before netting of allowance

7.2 Details of restricted due from financial institutions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		Financial institutions	December 31, 2022		December 31, 2021		Reasons of restriction
Due from financial institutions in Korean won	Due from the Bank of Korea	The Bank of Korea		15,169,704		15,317,033	Bank of Korea Act
	Due from others	NH Investment & Securities Co., Ltd. and others		24,152		20,733	Derivatives margin account
				15,193,856		15,337,766
Due from financial institutions in foreign currencies	Due from banks in foreign currencies	The Bank of Korea and others		2,350,756		2,262,610	Bank of Korea Act and others
	Time deposits in foreign currencies	Bank of Communications Co., Ltd. New York Branch		63,365		59,275	New York State Banking Law
	Due from others	State Street Bank and Trust Company		238,978		206,074	Derivatives margin account
				2,653,099		2,527,959
				17,846,955		17,865,725

* Before netting of allowance

87

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

7.3 Changes in allowances for credit losses of due from financial institutions for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	12-month expected credit losses			Lifetime expected credit losses
				Non-impaired		Impaired
Beginning		2,127			—		—
Transfer between stages		—			—		—
Provision (reversal) for credit losses		(358	)		—		—
Others (exchange differences, etc.)		106			—		—
Ending		1,875			—		—

	2021
(In millions of Korean won)	12-month expected credit losses		Lifetime expected credit losses
			Non-impaired			Impaired
Beginning		2,063		34			282
Transfer between stages		—		—			—
Provision (reversal) for credit losses		7		(35	)		(282	)
Others (exchange differences, etc.)		57		1			—
Ending		2,127		—			—

88

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

8. Assets Pledged as Collateral

8.1 Details of assets pledged as collateral as of December 31, 2022 and 2021, are as follows:

		December 31, 2022
(In millions of Korean won) Assets pledged	Pledgee	Carrying amount		Reasons of pledge
Securities measured at fair value through profit or loss	The Korea Securities Depository and others		116,645	Repurchase agreements
	Korea Securities Finance Corporation		34,071	Difference amount of the total limit
	The Bank of Korea		236,832	Settlement risk of the Bank of Korea
			387,548
Securities measured at fair value through other comprehensive income	The Bank of Korea		3,078,859	Repurchase agreements
			5,495,686	Borrowings from the Bank of Korea
			1,782,507	Settlement risk of the Bank of Korea
	MUFGBANK and others		475,265	Derivatives transactions
	UBSAG and others		486,654	Others
			11,318,971
Securities measured at amortized cost	The Bank of Korea and others		1,890,368	Repurchase agreements
	The Bank of Korea		4,020,539	Borrowings from the Bank of Korea
			5,047,277	Settlement risk of the Bank of Korea
	KB Securities Co., Ltd. and others		230,050	Derivatives transactions
	CITI Bank and others		378,416	Others
			11,566,650
Loans	Others		12,863,079	Covered bond and others
Building / Land	Hanwha Life Insurance Co., Ltd. and others		225,833	Others
			36,362,081
		December 31, 2021
(In millions of Korean won) Assets pledged	Pledgee	Carrying amount		Reasons of pledge
Securities measured at fair value through profit or loss	The Korea Exchange and others		267,505	Repurchase agreements
	Samsung Futures and others		9,889	Derivatives transactions
	Others		94,265	Others
			371,659
Securities measured at fair value through other comprehensive income	CITI Bank		57,693	Repurchase agreements
	The Bank of Korea		2,843,426	Borrowings from the Bank of Korea
			1,249,049	Settlement risk of the Bank of Korea
	JP Morgan Chase Bank and others		590,321	Derivatives transactions
	Others		34,757	Others
			4,775,246
Securities measured at amortized cost	Meritz Securities and others		494,974	Repurchase agreements
	The Bank of Korea		4,847,855	Borrowings from the Bank of Korea
			3,948,622	Settlement risk of the Bank of Korea
	KB Securities Co., Ltd. and others		133,860	Derivatives transactions
	KB Insurance Co., Ltd. and others		121,880	Others
			9,547,191
Loans	Others		9,659,575	Covered bond and others
Building / Land	Hanwha Life Insurance Co., Ltd. and others		227,414	Others
			24,581,085

89

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

8.2 Fair value of collateral available to sell or repledge, and collateral sold or repledged, regardless of debtor’s default as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Fair value of collateral held		Fair value of collateral sold or repledged
Securities		2,572,441		—
	December 31, 2021
(In millions of Korean won)	Fair value of collateral held		Fair value of collateral sold or repledged
Securities		5,963,678		—

90

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

9. Derivative Financial Instruments and Hedge Accounting

The Group engages in derivative trading activities to hedge the interest rate risk and currency risk arising from the Group’s own assets and liabilities. In particular, the Group applies fair value hedge accounting using interest rate swaps to hedge the risk of changes in fair value due to the changes in interest rate of structured debentures in Korean won, debentures, structured deposits in foreign currencies, and debt securities at fair value through other comprehensive income. Also, the Group applies cash flow hedge accounting using interest rate swaps to hedge the risk of changes in cash flows of debentures in foreign currencies, borrowings in foreign currencies, and group of loans measured at amortized cost. In addition, the Group applies net investments in foreign operations hedge accounting by designating debentures in foreign currencies and spot components of the currency forward as hedging instruments to hedge the currency risk of net investments in foreign operations.

9.1 Details of derivative financial instruments held for trading as of December 31, 2022 and 2021, are as follows:

	December 31, 2022						December 31, 2021
(In millions of Korean won)	Notional Amount		Assets		Liabilities		Notional amount		Assets		Liabilities
Interest rate
Forwards		2,765,927		355,407		11,092		738,589		24,928		296
Futures 1		2,105,953		—		—		1,863,050		—		—
Swaps 2		221,095,884		759,599		437,916		198,819,031		301,070		312,076
Options		9,798,000		268,469		265,283		11,657,000		172,060		195,666
		235,765,764		1,383,475		714,291		213,077,670		498,058		508,038
Currency
Forwards		107,620,136		2,557,498		2,354,719		95,717,113		1,217,979		854,539
Futures 1		50,692		—		—		—		—		—
Swaps		93,409,026		3,563,775		4,067,824		65,641,211		1,111,462		1,330,595
Options		2,270,274		24,585		29,294		2,051,034		7,643		13,376
		203,350,128		6,145,858		6,451,837		163,409,358		2,337,084		2,198,510
Stock and index
Options		355		33		—		355		17		—
		355		33		—		355		17		—
Credit
Swaps		—		—		—		13,423		—		—
		—		—		—		13,423		—		—
Others		94,300		—		450		94,300		43		393
		439,210,547		7,529,366		7,166,578		376,595,106		2,835,202		2,706,941

¹  Gains or losses arising from daily mark-to-market futures are reflected in the margin accounts.

²  Notional amounts of \ 184,565,603 million and \ 158,974,418 million as of December 31, 2022 and 2021, respectively, were traded through the central clearing house.

91

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

9.2 Average price conditions of future nominal cash flows by type of hedge accounting as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	1 year		2 years		3 years		4 years		5 years		Over 5 years		Total
Fair value hedge
Nominal amount of the hedging instrument		5,064,802		1,128,620		2,660,326		1,862,039		426,551		2,147,845		13,290,183
Average price condition (%), (CD and LIBOR)		4.17		4.52		4.64		4.56		4.36		4.64		4.43
Cash flow hedge
Nominal amount of the hedging instrument		843,555		226,730		—		—		806,003		—		1,876,288
Average price condition (%), (CD and LIBOR)		4.64		4.06		—		—		5.10		—		4.77

	December 31, 2021
(In millions of Korean won)	1 year		2 years		3 years		4 years		5 years		Over 5 years		Total
Fair value hedge
Nominal amount of the hedging instrument		1,044,669		1,171,185		701,102		2,153,038		1,420,914		2,419,231		8,910,139
Average price condition (%), (CD and LIBOR)		0.94		1.23		1.04		1.16		1.06		1.39		1.18
Cash flow hedge
Nominal amount of the hedging instrument		2,843,325		414,925		—		—		—		—		3,258,250
Average price condition (%), (CD and LIBOR)		0.93		0.76		—		—		—		—		0.91

92

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

9.3 Fair Value Hedge

9.3.1 Details of fair value hedged items as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

		December 31, 2022										2022
		Carrying amount				Accumulated amount of hedge adjustments						Changes in fair value
(In millions of Korean won)		Assets		Liabilities		Assets			Liabilities
Interest rate	Debt securities in Korean won		2,467,171		—		(107,444	)		—			(86,757	)
	Debt securities in foreign currencies		3,142,972		—		(232,085	)		—			(215,184	)
	Deposits in foreign currencies		—		29,429		—			(8,591	)		6,976
	Debentures in Korean won		—		5,690,371		—			(249,629	)		171,841
	Debentures in foreign currencies		—		1,196,781		—			(95,865	)		123,817
			5,610,143		6,916,581		(339,529	)		(354,085	)		693
		December 31, 2021										2021
		Carrying amount				Accumulated amount of hedge adjustments						Changes in fair value
(In millions of Korean won)		Assets		Liabilities		Assets			Liabilities
Interest rate	Debt securities in Korean won		1,627,228		—		(20,272	)		—			(21,071	)
	Debt securities in foreign currencies		3,567,662		—		(12,505	)		—			(71,246	)
	Deposits in foreign currencies		—		93,521		—			(1,319	)		3,222
	Debentures in Korean won		—		2,470,123		—			(79,877	)		70,308
	Debentures in foreign currencies		—		1,154,178		—			27,953			45,132
			5,194,890		3,717,822		(32,777	)		(53,243	)		26,345

9.3.2 Details of derivative instruments designated as fair value hedge as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

	December 31, 2022						2022
(In millions of Korean won)	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		13,290,183		186,258		104,856		(1,245	)
	December 31, 2021						2021
(In millions of Korean won)	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		8,910,139		127,290		38,253		(33,228	)

93

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

9.3.3 Details of hedge ineffectiveness recognized in profit or loss on derivative instruments designated as fair value hedge for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Interest rate		(552	)		(6,883	)

9.3.4 Gains or losses on fair value hedging instruments and hedged items attributable to the hedged risk for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Gains and Losses on hedging instruments		28,171			(12,657	)
Gains on hedged items attributable to the hedged risk		(28,752	)		13,056
		(581	)		399

9.4 Cash Flow Hedge

9.4.1 Details of cash flow hedged items as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

	Cash flow hedge reserve					Changes in fair value
(In millions of Korean won)	December 31, 2022		December 31, 2021			2022			2021
Interest rate risk		33,921		(89	)		(47,251	)		(11,306	)

9.4.2 Details of derivative instruments designated as cash flow hedge as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

	December 31, 2022						2022
(In millions of Korean won)	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		1,876,288		51,968		—		44,064

	December 31, 2021						2021
(In millions of Korean won)	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		3,258,250		3,134		4,218		11,555

94

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

9.4.3 Gains on cash flow hedging instruments and hedged items attributable to the hedged risk for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Gains on hedging instruments:		44,064		11,555
Effective portion of gains on cash flow hedging instruments (recognized in other comprehensive income or loss)		43,886		11,468
Ineffective portion of gains on cash flow hedging instruments (recognized in profit or loss)		178		87

9.4.4 Amounts recognized in other comprehensive income and reclassified from equity to profit related to derivative instruments designated as cash allow hedge for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Other comprehensive income		43,886			11,468
Reclassification to profit		2,388			2,303
Income tax effect		(12,264	)		(3,787	)
		34,010			9,984

9.4.5 As of December 31, 2022, the hedged items subject to cash flow hedge are exposed to the risk of changes in cash flows until August 5, 2027.

9.5 Hedge of Net Investments in Foreign Operations

9.5.1 Details of net investments in foreign operations hedged items as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

	Foreign currency translation reserve						Changes in fair value
(In millions of Korean won)	December 31, 2022			December 31, 2021			2022		2021
Currency risk		(95,296	)		(30,306	)		87,853		80,235

95

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

9.5.2 Details of financial instruments designated as hedge of net investments in foreign operations as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

	December 31, 2022						2022
(In millions of Korean won)	Notional amount		Assets		Liabilities		Changes in fair value
Debentures in foreign currencies		1,361,080		—		1,361,080		(87,853	)

	December 31, 2021						2021
(In millions of Korean won)	Notional amount		Assets		Liabilities		Changes in fair value
Debentures in foreign currencies		1,273,227		—		1,273,227		(80,235	)

9.5.3 Fair value of non-derivative financial instruments designated as hedge of net investments in foreign operations as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Debentures in foreign currencies		1,211,215		1,275,291

9.5.4 Losses on net investments in foreign operations hedging instruments and hedged items attributable to the hedged risk for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Losses on hedging instruments:		(87,853	)		(80,235	)
Effective portion of losses on hedge of net investments in foreign operations (recognized in other comprehensive loss)		(87,853	)		(80,235	)
Ineffective portion of losses on hedge of net investments in foreign operations (recognized in loss)		—			—

9.5.5 Effective portion of gains (losses) on net investments in foreign operations hedging instruments recognized in other comprehensive loss for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Other comprehensive loss		(87,853	)		(80,241	)
Reclassification to income		—			5,195
Income tax effect		22,863			20,637
		(64,990	)		(54,409	)

96

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

9.6 Interest Rate Benchmark Reform

The USD LIBOR interest rate will be replaced by the Secured Overnight Financing Rate (“SOFR”) based on actual transactions. In the case of KRW, the Korean government bond/monetary stabilization bond RP rate has been finally decided as the Risk-Free Reference Rate (“RFR”) and will replace the Certificate of Deposit (“CD”) rate in the mid to long-term. Within the corresponding hedging relationship of related significant interest rate benchmark, the Group assumed that the spread to be changed on the RFR basis including SOFR would be similar to that included in the interest rate swap used as a hedging instrument, and no other changes were assumed.

Details of the Group’s exposure to hedging relationships related to the interest rate benchmark reform as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won and millions of US dollars)			December 31, 2022
Interest rate benchmark	Currency		Carrying amount of non-derivative assets		Carrying amount of non-derivative liabilities		Notional amount of hedging instruments
CD#3M		KRW		3,060,791		5,690,371		6,440,000
USD#LIBOR#3M		USD		1,895		1,257		3,478
USD#LIBOR#6M		USD		167		—		182

			December 31, 2021
Interest rate benchmark	Currency		Carrying amount of non-derivative assets		Carrying amount of non-derivative liabilities		Notional amount of hedging instruments
CD#3M		KRW		3,123,388		2,470,123		5,690,000
USD#LIBOR#3M		USD		2,695		2,154		4,836
USD#LIBOR#6M		USD		224		—		225

10. Loans Measured at Amortized Cost

10.1 Details of loans as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Loans		377,000,459			363,049,216
Deferred loan origination fees and costs		436,128			522,425
Less: Allowances for credit losses		(2,764,611	)		(2,426,940	)
		374,671,976			361,144,701

10.2 Details of loans to banks as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Loans		9,751,737			8,325,177
Less: Allowances for credit losses		(1,951	)		(443	)
		9,749,786			8,324,734

97

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

10.3 Details of loan types and customer types of loans to customers other than banks as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Retail			Corporate			Credit card			Total
Loans in Korean won		166,731,575			161,671,964			—			328,403,539
Loans in foreign currencies		3,732,325			25,210,008			—			28,942,333
Domestic import usance bills		—			4,499,072			—			4,499,072
Off-shore funding loans		—			943,751			—			943,751
Call loans		—			119,066			—			119,066
Bills bought in Korean won		—			285,727			—			285,727
Bills bought in foreign currencies		—			1,780,874			—			1,780,874
Guarantee payments under acceptances and guarantees		—			18,459			—			18,459
Credit card receivables in foreign currencies		—			—			43,022			43,022
Bonds purchased under repurchase agreements		—			2,281,357			—			2,281,357
Privately placed bonds		—			367,650			—			367,650
		170,463,900			197,177,928			43,022			367,684,850
Proportion (%)		46.36			53.63			0.01			100.00
Less: Allowances for credit losses		(946,471	)		(1,800,432	)		(15,757	)		(2,762,660	)
		169,517,429			195,377,496			27,265			364,922,190

	December 31, 2021
(In millions of Korean won)	Retail			Corporate			Credit card			Total
Loans in Korean won		170,760,821			148,957,704			—			319,718,525
Loans in foreign currencies		3,218,116			20,267,749			—			23,485,865
Domestic import usance bills		—			3,311,142			—			3,311,142
Off-shore funding loans		—			1,135,753			—			1,135,753
Call loans		—			902,301			—			902,301
Bills bought in Korean won		—			2,209			—			2,209
Bills bought in foreign currencies		—			2,001,046			—			2,001,046
Guarantee payments under acceptances and guarantees		—			20,773			—			20,773
Credit card receivables in foreign currencies		—			—			55,520			55,520
Bonds purchased under repurchase agreements		—			4,408,594			—			4,408,594
Privately placed bonds		—			204,736			—			204,736
		173,978,937			181,212,007			55,520			355,246,464
Proportion (%)		48.97			51.01			0.02			100.00
Less: Allowances for credit losses		(669,125	)		(1,736,776	)		(20,596	)		(2,426,497	)
		173,309,812			179,475,231			34,924			352,819,967

98

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

10.4 Changes in deferred loan origination fees and costs for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning		Increase		Decrease			Others			Ending
Deferred loan origination costs
Loans in Korean won		583,477		243,913		(305,106	)		—			522,284
Others		168		550		(343	)		4			379
		583,645		244,463		(305,449	)		4			522,663
Deferred loan origination fees
Loans in Korean won		10,076		23,067		(9,423	)		—			23,720
Loans in foreign currencies and others		51,144		45,554		(36,346	)		2,463			62,815
		61,220		68,621		(45,769	)		2,463			86,535
		522,425		175,842		(259,680	)		(2,459	)		436,128

	2021
(In millions of Korean won)	Beginning		Increase		Decrease			Others			Ending
Deferred loan origination costs
Loans in Korean won		590,064		327,891		(334,478	)		—			583,477
Others		569		51		(451	)		(1	)		168
		590,633		327,942		(334,929	)		(1	)		583,645
Deferred loan origination fees
Loans in Korean won		6,998		5,479		(2,400	)		(1	)		10,076
Loans in foreign currencies and others		43,025		31,216		(26,717	)		3,620			51,144
		50,023		36,695		(29,117	)		3,619			61,220
		540,610		291,247		(305,812	)		(3,620	)		522,425

99

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

11. Allowances for Credit Losses

11.1 Changes in allowances for credit losses of loans for the years ended December 31, 2022 and 2021, are as follows:

	2022
	Retail											Corporate											Credit card
(In millions of Korean won)	12-month expected credit losses			Lifetime expected credit losses						Credit impaired approach		12-month expected credit losses			Lifetime expected credit losses						Credit impaired approach		12-month expected credit losses			Lifetime expected credit losses						Credit impaired approach
				Non-impaired			Impaired								Non-impaired			Impaired								Non-impaired			Impaired
Beginning		299,033			174,459			195,633			—		366,300			454,618			916,301			—		1,078			—			19,518			—
Transfer between stages:
Transfer to 12-month expected credit losses		122,203			(115,982	)		(6,221	)		—		127,532			(120,472	)		(7,060	)		—		5,551			—			(5,551	)		—
Transfer to lifetime expected credit losses (non-impaired)		(95,013	)		106,174			(11,161	)		—		(92,679	)		124,435			(31,756	)		—		—			—			—			—
Transfer to lifetime expected credit losses (impaired)		(1,771	)		(41,840	)		43,611			—		(10,016	)		(48,065	)		58,081			—		(34	)		—			34			—
Write-offs		—			(1	)		(257,656	)		—		—			(3	)		(582,470	)		—		—			—			(6,182	)		—
Sales		(805	)		(137	)		(289	)		—		(103	)		(145	)		(66,974	)		—		—			—			—			—
Provision (reversal) for credit losses 1, 2		115,830			83,346			355,717			—		6,911			114,300			666,251			—		(5,278	)		309			8,520			—
Others (exchange differences, etc.)		(1,937	)		(650	)		(16,072	)		—		7,757			1,411			(81,771	)		—		(430	)		(21	)		(1,757	)		—
Ending		437,540			205,369			303,562			—		405,702			526,079			870,602			—		887			288			14,582			—

100

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

11.1 Changes in allowances for credit losses of loans for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021
	Retail											Corporate											Credit card
(In millions of Korean won)	12-month expected credit losses			Lifetime expected credit losses						Credit impaired approach		12-month expected credit losses			Lifetime expected credit losses						Credit impaired approach		12-month expected credit losses		Lifetime expected credit losses					Credit impaired approach
				Non-impaired			Impaired								Non-impaired			Impaired							Non-impaired		Impaired
Beginning		270,545			177,665			170,621			—		333,135			388,522			843,225			—		74		—		3,024			—
Transfer between stages:
Transfer to 12-month expected credit losses		118,301			(113,470	)		(4,831	)		—		133,653			(71,680	)		(61,973	)		—		7		—		(7	)		—
Transfer to lifetime expected credit losses (non-impaired)		(91,250	)		100,691			(9,441	)		—		(71,169	)		91,380			(20,211	)		—		—		—		—			—
Transfer to lifetime expected credit losses (impaired)		(4,370	)		(42,616	)		46,986			—		(2,894	)		(41,657	)		44,551			—		—		—		—			—
Write-offs		—			12			(230,859	)		—		—			(3	)		(237,343	)		—		—		—		(18,924	)		—
Sales		(1,100	)		(33	)		(975	)		—		(5	)		—			(15,662	)		—		—		—		—			—
Provision (reversal) for credit losses 1, 2		6,837			51,691			221,946			—		(35,521	)		87,382			334,073			—		955		—		35,003			—
Others (exchange differences, etc.)		70			519			2,186			—		9,101			674			29,641			—		42		—		422			—
Ending		299,033			174,459			195,633			—		366,300			454,618			916,301			—		1,078		—		19,518			—

¹ Provision (reversal) for credit losses in the consolidated statements of comprehensive income also includes provision (reversal) for credit losses of unused commitments, acceptances and guarantees (Note 22.2), provision (reversal) for credit losses of financial guarantee contracts (Note 22.4), provision (reversal) for credit losses of other financial assets (Note 18.2), provision (reversal) for credit losses of due from financial institutions (Note 7.3) and provision (reversal) for credit losses of debt securities (Note 12.5).

² Includes \ 267,928 million and \ 230,758 million of collections from written-off loans for the years ended December 31, 2022 and 2021, respectively.

The Group manages the written-off loans that their legal extinctive prescriptions have not been completed, and that have not been collected. The balances of those loans are \ 7,870,811 million and \ 7,939,987 million as of December 31, 2022 and 2021, respectively.

101

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

11.2 Changes in gross carrying amount of loans for the years ended December 31, 2022 and 2021, are as follows:

	2022
	12-month expected credit losses			Lifetime expected credit losses						Credit impaired approach
(In millions of Korean won)				Non-impaired			Impaired
Beginning		334,424,618			26,384,843			2,762,180			—
Transfer between stages:
Transfer to 12-month expected credit losses		33,450,163			(33,290,588	)		(159,575	)		—
Transfer to lifetime expected credit losses (non-impaired)		(36,749,481	)		37,156,737			(407,256	)		—
Transfer to lifetime expected credit losses (impaired)		(923,910	)		(1,312,907	)		2,236,817			—
Write-offs		—			(4	)		(846,308	)		—
Sales		(2,459,517	)		(14,788	)		(228,857	)		—
Net increase (decrease) (execution, repayment, and others)		20,390,409			(2,252,470	)		(723,519	)		—
Ending		348,132,282			26,670,823			2,633,482			—

	2021
	12-month expected credit losses			Lifetime expected credit losses						Credit impaired approach
(In millions of Korean won)				Non-impaired			Impaired
Beginning		302,701,700			24,106,892			2,710,714			—
Transfer between stages:
Transfer to 12-month expected credit losses		30,120,605			(29,694,039	)		(426,566	)		—
Transfer to lifetime expected credit losses (non-impaired)		(34,694,281	)		35,139,427			(445,146	)		—
Transfer to lifetime expected credit losses (impaired)		(520,253	)		(1,373,673	)		1,893,926			—
Write-offs		—			10			(487,127	)		—
Sales		(2,755,184	)		(7,780	)		(136,052	)		—
Net increase (decrease) (execution, repayment, and others)		39,572,031			(1,785,994	)		(347,569	)		—
Ending		334,424,618			26,384,843			2,762,180			—

102

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

12. Financial Assets at Fair Value through Profit or Loss and Financial Investments

12.1 Details of financial assets at fair value through profit or loss and financial investments as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Financial assets at fair value through profit or loss
Debt securities:
Government and public bonds		4,548,399			2,690,148
Financial bonds		7,285,980			7,710,531
Corporate bonds		1,170,321			1,804,306
Asset-backed securities		164,543			197,865
Beneficiary certificates		5,728,058			4,634,210
Investment funds		528,795			378,712
Derivative-linked securities		55,624			—
Other debt securities		1,274,859			1,097,316
Equity securities:
Stocks		217,748			113,724
Loans:
Other loans		149,075			93,930
Others:
Financial instruments indexed to the price of gold		90,006			113,622
		21,213,408			18,834,364
Financial investments
Financial assets at fair value through other comprehensive income
Debt securities:
Government and public bonds		8,148,852			6,147,357
Financial bonds		17,113,728			18,681,163
Corporate bonds		12,606,868			12,529,985
Asset-backed securities		237,605			782,401
Other debt securities		256,779			—
Equity securities:
Stocks		1,402,967			3,144,131
Equity investments		15,555			25,669
Loans:
Privately placed bonds		231,021			269,609
		40,013,375			41,580,315
Financial assets at amortized cost
Debt securities:
Government and public bonds		6,520,633			5,742,284
Financial bonds		10,936,138			3,376,623
Corporate bonds		10,026,039			6,358,169
Asset-backed securities		7,395,434			6,659,710
Other debt securities		363,984			31,106
Less: Allowances for credit losses		(5,434	)		(3,298	)
		35,236,794			22,164,594
		75,250,169			63,744,909

103

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

12.2 Dividend income from equity securities designated at fair value through other comprehensive income for the years ended December 31, 2022 and 2021, are as follows:

	2022				2021
(In millions of Korean won)	From the equity securities derecognized		From the equity securities held		From the equity securities derecognized		From the equity securities held
Listed Stocks		—		409		7,106		300
Unlisted Stocks		—		9,526		372		10,148
		—		9,935		7,478		10,448

12.3 Derecognized equity securities measured at fair value through other comprehensive income for the years ended December 31, 2022 and 2021, are as follows:

	2022				2021
(In millions of Korean won)	Disposal price *		Accumulated other comprehensive income as of disposal date		Disposal price *		Accumulated other comprehensive loss as of disposal date
Listed Stocks		425,736		335,203		575,288		(319,162	)
Unlisted Stocks		—		—		458		(162	)
		425,736		335,203		575,746		(319,324	)

* The stocks were disposed of according to the stock price increase and joint sale resolution.

12.4 Provision (reversal) for credit losses of financial investments for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Provision		Reversal			Total
Financial assets at fair value through other comprehensive income		2,007		(3,544	)		(1,537	)
Securities measured at amortized cost		2,808		(670	)		2,138
		4,815		(4,214	)		601

	2021
(In millions of Korean won)	Provision		Reversal			Total
Financial assets at fair value through other comprehensive income		6,190		(384	)		5,806
Securities measured at amortized cost		1,628		(662	)		966
		7,818		(1,046	)		6,772

104

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

12.5 Changes in allowances for credit losses of financial investments for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	12-month expected credit losses			Lifetime expected credit losses
				Non-impaired			Impaired
Beginning		12,169			27			—
Transfer between stages:
Transfer to 12-month expected credit losses		—			—			—
Transfer to lifetime expected credit losses		—			—			—
Sales		(612	)		(20	)		—
Provision (reversal) for credit losses		338			263			—
Others (exchange differences, etc.)		198			—			—
Ending		12,093			270			—

	2021
(In millions of Korean won)	12-month expected credit losses			Lifetime expected credit losses
				Non-impaired			Impaired
Beginning		6,986			39			—
Transfer between stages:
Transfer to 12-month expected credit losses		—			—			—
Transfer to lifetime expected credit losses		—			—			—
Sales		(1,567	)		(4	)		—
Provision for credit losses		6,784			(12	)		—
Others (exchange differences, etc.)		(34	)		4			—
Ending		12,169			27			—

105

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13. Investments in Associates

13.1 Details of investments in associates as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
Korea Credit Bureau Co., Ltd. 1		9.00		4,500		4,959			4,959	Credit information		Korea
Incheon Bridge Co., Ltd. 1		14.99		9,159		(15,963	)		—	Operation of highways and related facilities		Korea
KB SPROTT Renewable Private Equity Fund No.1		30.00		14,361		13,165			13,165	Investment finance		Korea
KB Digital Innovation & Growth New Technology Business Investment Fund		45.00		4,500		4,038			4,038	Discovery of and investment in promising FinTech-business venture		Korea
KB Digital Platform Fund		46.67		26,600		25,357			25,357	Digital platform and Tech-based investment in promising companies		Korea
KB Prime Digital Platform Fund		43.33		2,600		2,563			2,563	Digital platform and Tech-based investment in promising companies		Korea
Future Planning KB Start-up Creation Fund		50.00		2,200		9,793			9,793	Investment finance		Korea
KB High-tech Company Investment Fund		50.00		1,500		10,662			10,662	Investment finance		Korea
Aju Good Technology Venture Fund		38.47		8,144		19,840			19,836	Investment finance		Korea
KB-KDBC Pre-IPO New Technology Business Investment Fund		33.33		1,800		2,989			2,989	Investment finance		Korea
KB-TS Technology Venture Private Equity Fund		30.00		5,220		7,390			7,390	Investment finance		Korea
KB Intellectual Property Fund No.2		37.50		15,000		15,204			15,204	Investment finance		Korea
KB Digital Innovation Investment Fund Limited Partnership		25.74		35,000		34,693			35,000	Investment finance		Korea
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		21.28		6,600		8,901			8,901	Investment finance		Korea
KB Global Platform Fund		22.73		43,850		50,366			50,366	Investment finance		Korea
KB-UTC Inno-Tech Venture Fund		29.53		14,250		12,786			12,786	Investment finance		Korea
WJ Private Equity Fund No.1		26.95		10,000		9,542			9,542	Investment finance		Korea
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		28.57		10,000		8,380			8,380	Investment finance		Korea
KB Smart Scale Up Fund		25.00		43,000		40,288			40,288	Investment finance		Korea
KB Scale Up Fund II		20.00		4,500		4,438			4,438	Investment finance		Korea
KB Bio Global Expansion Private Equity Fund No.1		26.32		10,000		10,519			10,519	Investment finance		Korea
KB-KTB Technology Venture Fund		27.27		9,000		8,709			8,709	Investment finance		Korea
KB-SOLIDUS Healthcare Investment Fund		29.41		6,600		6,217			6,217	Investment finance		Korea

106

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2022
(In millions of Korean won)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
KB New Deal Innovation Fund		20.00		13,600		13,241			13,241	Investment finance	Korea
All Together Korea Fund No.2 2		99.99		10,000		10,244			10,244	Asset management	Korea
Shinla Construction Co., Ltd. 3		20.17		—		(551	)		—	Specialty construction	Korea
Terra Corporation 3		24.06		—		2			—	Manufacture of fabricated and processed metal products	Korea
MJT&I Corp. 3		22.89		—		(882	)		—	Wholesale of other merchandise	Korea
Jungdong Steel Co., Ltd. 3		42.65		—		(433	)		—	Wholesale of primary metal	Korea
DSMETAL Co., Ltd. 3		26.49		—		(101	)		—	Manufacture of metal door, windows, shutter and relevant products	Korea
Shinhwa Underwear Co., Ltd. 3		26.05		—		(73	)		167	Manufacture of underwear and sleepwear	Korea
Jaeyang Industry Co., Ltd. 3		20.86		—		(552	)		—	Manufacture of luggage and other protective cases	Korea
Kendae Co., Ltd. 3		41.01		—		(252	)		98	Screen printing	Korea
Jinseung Tech Co., Ltd. 3		30.04		—		(191	)		—	Manufacture of other general-purpose machinery	Korea
Dongjo Co., Ltd. 3		29.29		—		(5	)		—	Wholesale of agricultural and forestry machinery and equipment	Korea
Korea NM Tech Co., Ltd. 3		22.41		—		549			—	Manufacture of motor vehicles, trailers and semitrailers	Korea
Jungdo Co., Ltd. 3		25.34		—		1,112			—	Office, commercial and institutional building construction	Korea
Dae-A Leisure Co., Ltd. 3		49.36		—		523			—	Earth works	Korea
Chongil Machine & Tools Co., Ltd. 3		20.40		—		(178	)		—	Wholesale of machinery and equipment	Korea
Imt Technology Co., Ltd. 3		25.29		—		34			15	Computer Peripherals Distribution	Korea
Iwon Alloy Co., Ltd. 3		23.20		—		374			—	Manufacture of smelting, refining and alloys	Korea
Computerlife Co., Ltd. 3		25.41		—		(130	)		50	Publishing of magazines and periodicals (publishing industry)	Korea
Skydigital Inc. 3		20.40		—		(318	)		—	Manufacture of multimedia and video devices	Korea
Jo Yang Industrial Co., Ltd. 3		22.77		—		(36	)		—	Manufacture of special glass	Korea
Il-Kwang Electronic Materials Co., Ltd. 3		29.06		—		(555	)		—	Manufacture of electronic parts	Korea
So-Myung Recycling Co., Ltd. 3		20.23		—		246			61	Manufacture of nonferrous metal	Korea
IDTECK Co., Ltd. 3		20.54		—		42			164	Other manufacturing of wireless telecommunications equipment	Korea
PIP System Co., Ltd. 3		20.72		—		27			—	Print equipment	Korea

107

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2022
(In millions of Korean won)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
Gwang Myung Paper Co., Ltd. 3		20.54		—		84			—	Wholesale of luggage and other protective cases	Korea
D-Partner 3		20.94		—		832			384	Backlight film	Korea
Inter Shipping Co., Ltd. 3		42.09		—		(1,038	)		—	Sea freight water transport	Korea
Chunsung-meat Co., Ltd. 3		26.74		—		246			—	Wholesale of meat	Korea
DS Fashionbiz Co., Ltd. 3		47.64		—		(1	)		1	Manufacture of textiles	Korea
ALTSCS Co., Ltd. 3		47.11		—		408			—	Manufacture of motor vehicle parts	Korea
E-Won Chemical Co., Ltd. 3		24.30		—		35			—	Manufacture, wholesale and retail trade of feeds	Korea
TMAPMOBILITY CO.,LTD. 1		8.25		200,000		61,518			194,454	Application software development and supply	Korea
TKDS CO., LTD 3		20.03		—		171			—	Manufacture of video and other imaging equipment	Korea
SANDLE FARMING ASSOCIATION 3		23.04		—		306			—	Manufacture of edible refined oil and processed oil	Korea
				511,984		379,534			529,981

108

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021
(In millions of Korean won)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
Korea Credit Bureau Co., Ltd. 1		9.00		4,500		4,497			4,497	Credit information	Korea
Balhae Infrastructure Company 1		12.61		105,923		99,785			99,785	Investment finance	Korea
Incheon Bridge Co., Ltd. 1		14.99		9,159		(19,481	)		—	Operation of highways and related facilities	Korea
KB SPROTT Renewable Private Equity Fund No.1		30.00		4,613		3,726			3,726	Investment finance	Korea
KB Digital Innovation & Growth New Technology Business Investment Fund		45.00		4,500		4,098			4,098	Discovery of and investment in promising FinTech-business venture	Korea
KB Digital Platform Fund		46.67		12,600		12,599			12,599	Digital platform and Tech-based investment in promising companies	Korea
Future Planning KB Start-up Creation Fund		50.00		3,900		10,275			10,275	Investment finance	Korea
KB High-tech Company Investment Fund		50.00		1,500		10,493			10,493	Investment finance	Korea
Aju Good Technology Venture Fund		38.47		12,344		22,926			22,921	Investment finance	Korea
KB-KDBC Pre-IPO New Technology Business Investment Fund		33.33		4,400		5,895			5,895	Investment finance	Korea
KB-TS Technology Venture Private Equity Fund		30.00		7,650		9,015			9,015	Investment finance	Korea
KB Intellectual Property Fund No.2		37.50		15,000		13,838			14,588	Investment finance	Korea
KB Digital Innovation Investment Fund Limited Partnership		25.74		35,000		35,517			35,517	Investment finance	Korea
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		21.28		13,000		14,834			14,834	Investment finance	Korea
KB Global Platform Fund		22.73		42,000		49,946			49,946	Investment finance	Korea
KB-UTC Inno-Tech Venture Fund		29.53		14,250		13,982			13,982	Investment finance	Korea
WJ Private Equity Fund No.1		26.95		10,000		9,604			9,604	Investment finance	Korea
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		28.57		10,000		9,571			9,571	Investment finance	Korea
KB Smart Scale Up Fund		25.00		31,000		31,217			31,217	Investment finance	Korea
KB Bio Global Expansion Private Equity Fund No.1		26.32		10,000		9,978			9,978	Investment finance	Korea
KB-KTB Technology Venture Fund		27.27		3,000		2,975			2,975	Investment finance	Korea
KB-SOLIDUS Healthcare Investment Fund		29.41		600		600			600	Investment finance	Korea
KB New Deal Innovation Fund		20.00		4,000		3,991			3,991	Investment finance	Korea
All Together Korea Fund No.2 2		99.99		10,000		10,070			10,070	Asset management	Korea
Shinla Construction Co., Ltd. 3		20.17		—		(551	)		—	Specialty construction	Korea
Terra Corporation 3		24.06		—		2			—	Manufacture of fabricated and processed metal products	Korea

109

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021
(In millions of Korean won)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
MJT&I Corp. 3		22.89		—		(881	)		—	Wholesale of other merchandise	Korea
Jungdong Steel Co., Ltd. 3		42.65		—		(433	)		—	Wholesale of primary metal	Korea
DSMETAL Co., Ltd. 3		26.49		—		(100	)		—	Manufacture of metal door, windows, shutter and relevant products	Korea
Shinhwa Underwear Co., Ltd. 3		26.05		—		(41	)		198	Manufacture of underwear and sleepwear	Korea
Jaeyang Industry Co., Ltd. 3		20.86		—		(552	)		—	Manufacture of luggage and other protective cases	Korea
Kendae Co., Ltd. 3		41.01		—		(252	)		98	Screen printing	Korea
Jinseung Tech Co., Ltd. 3		30.04		—		(206	)		—	Manufacture of other general-purpose machinery	Korea
Dongjo Co., Ltd. 3		29.29		—		712			21	Wholesale of agricultural and forestry machinery and equipment	Korea
Korea NM Tech Co., Ltd. 3		22.41		—		552			—	Manufacture of motor vehicles, trailers and semitrailers	Korea
Jungdo Co., Ltd. 3		25.34		—		1,105			—	Office, commercial and institutional building construction	Korea
Dae-A Leisure Co., Ltd. 3		49.36		—		833			—	Earth works	Korea
Chongil Machine & Tools Co., Ltd. 3		20.40		—		(171	)		—	Wholesale of machinery and equipment	Korea
Imt Technology Co., Ltd. 3		25.29		—		25			6	Computer Peripherals Distribution	Korea
Iwon Alloy Co., Ltd. 3		23.20		—		394			—	Manufacture of smelting, refining and alloys	Korea
Carlife Co., Ltd. 3		24.39		—		(62	)		13	Publishing of magazines and periodicals (publishing industry)	Korea
Computerlife Co., Ltd. 3		25.41		—		(137	)		44	Publishing of magazines and periodicals (publishing industry)	Korea
Skydigital Inc. 3		20.40		—		(316	)		—	Manufacture of multimedia and video devices	Korea
Jo Yang Industrial Co., Ltd. 3		22.77		—		(29	)		—	Manufacture of special glass	Korea
Il-Kwang Electronic Materials Co., Ltd. 3		29.06		—		(557	)		—	Manufacture of electronic parts	Korea
So-Myung Recycling Co., Ltd. 3		20.23		—		215			31	Manufacture of nonferrous metal	Korea
IDTECK Co., Ltd. 3		20.54		—		(208	)		—	Other manufacturing of wireless telecommunications equipment	Korea
PIP System Co., Ltd. 3		20.72		—		27			—	Print equipment	Korea
Gwang Myung Paper Co., Ltd. 3		20.54		—		84			—	Wholesale of luggage and other protective cases	Korea

110

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021
(In millions of Korean won)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
D-Partner 3		20.94		—		816			369	Backlight film	Korea
Inter Shipping Co., Ltd. 3		42.09		—		(17	)		—	Sea freight water transport	Korea
Chunsung-meat Co., Ltd. 3		26.74		—		270			—	Wholesale of meat	Korea
DS Fashionbiz Co., Ltd. 3		47.64		—		(1	)		—	Manufacture of textiles	Korea
				368,939		370,472			390,957

¹ As of December 31, 2022 and 2021, the Group can exercise significant influence on the decision-making processes of the associate’s financial and business policies through participation in governing bodies.

²  As of December 31, 2022 and 2021, the Group participates in the investment management committee but cannot exercise control.

³ The investment in associates was reclassified from financial assets at fair value through other comprehensive income due to termination of rehabilitation procedures.

Although the Group holds 20% or more of the ownership in several investment trusts including KB Hanbando BTL Private Special Asset Fund No.1, those investment trusts are excluded from associates because the Group’s influence on those trusts is limited according to the trust agreement. In addition, the Group holds 20% or more of its ownership in Seokwang T&I Co., Ltd. and six other companies, but those companies are excluded from associates, because the Group’s influence on those companies is limited due to the status of those companies such as bankruptcy and rehabilitation proceedings.

111

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.2 Condensed financial information, adjustments to the carrying amount, and dividend from major investments in associates as of and for the years ended December 31, 2022 and 2021, are as follows:

	December 31, 2022 *
(In millions of Korean won)	Total assets		Total liabilities		Paid-in capital		Equity			Share of net asset amount			Unrealized gains (losses) and others			Carrying amount
Korea Credit Bureau Co., Ltd.		155,165		100,065		10,000		55,100			4,959			—			4,959
Incheon Bridge Co., Ltd.		554,738		661,227		61,096		(106,489	)		(15,963	)		15,963			—
KB SPROTT Renewable Private Equity Fund No.1		44,880		996		47,868		43,884			13,165			—			13,165
KB Digital Innovation & Growth New Technology Business Investment Fund		9,060		87		10,000		8,973			4,038			—			4,038
KB Digital Platform Fund		55,091		755		57,000		54,336			25,357			—			25,357
KB Prime Digital Platform Fund		6,022		108		6,000		5,914			2,563			—			2,563
Future Planning KB Start-up Creation Fund		21,965		2,379		4,400		19,586			9,793			—			9,793
KB High-tech Company Investment Fund		24,480		3,157		3,000		21,323			10,662			—			10,662
Aju Good Technology Venture Fund		58,749		7,171		21,180		51,578			19,840			(4	)		19,836
KB-KDBC Pre-IPO New Technology Business Investment Fund		9,226		260		5,400		8,966			2,989			—			2,989
KB-TS Technology Venture Private Equity Fund		30,347		5,715		17,400		24,632			7,390			—			7,390
KB Intellectual Property Fund No.2		42,713		2,169		40,000		40,544			15,204			—			15,204
KB Digital Innovation Investment Fund Limited Partnership		137,321		2,512		136,000		134,809			34,693			307			35,000
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		42,538		705		31,020		41,833			8,901			—			8,901
KB Global Platform Fund		224,388		2,779		192,940		221,609			50,366			—			50,366
KB-UTC Inno-Tech Venture Fund		44,111		809		48,260		43,302			12,786			—			12,786
WJ Private Equity Fund No.1		35,561		161		37,100		35,400			9,542			—			9,542
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		29,462		132		35,000		29,330			8,380			—			8,380
KB Smart Scale Up Fund		161,926		776		172,000		161,150			40,288			—			40,288
KB Scale Up Fund II		22,571		379		22,500		22,192			4,438			—			4,438
KB Bio Global Expansion Private Equity Fund No.1		40,080		106		38,000		39,974			10,519			—			10,519
KB-KTB Technology Venture Fund		32,214		280		33,000		31,934			8,709			—			8,709
KB-SOLIDUS Healthcare Investment Fund		21,483		345		22,440		21,138			6,217			—			6,217
KB New Deal Innovation Fund		68,245		2,039		68,000		66,206			13,241			—			13,241
All Together Korea Fund No.2		10,246		1		10,001		10,245			10,244			—			10,244
TMAPMOBILITY CO.,LTD.		920,597		174,696		8,677		745,901			61,518			132,936			194,454

112

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.2 Condensed financial information, adjustments to the carrying amount, and dividend from major investments in associates as of and for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2022 *
(In millions of Korean won)	Operating revenue		Net profit (loss)			Other comprehensive income			Total comprehensive income (loss)			Dividends
Korea Credit Bureau Co., Ltd.		144,907		13,809			—			13,809			—
Incheon Bridge Co., Ltd.		130,456		23,754			—			23,754			—
KB SPROTT Renewable Private Equity Fund No.1		—		(1,020	)		—			(1,020	)		—
KB Digital Innovation & Growth New Technology Business Investment Fund		294		(134	)		—			(134	)		—
KB Digital Platform Fund		264		(2,663	)		—			(2,663	)		—
KB Prime Digital Platform Fund		22		(86	)		—			(86	)		—
Future Planning KB Start-up Creation Fund		4,780		2,436			—			2,436			—
KB High-tech Company Investment Fund		9,149		2,937			—			2,937			1,300
Aju Good Technology Venture Fund		22,381		6,018			—			6,018			1,200
KB-KDBC Pre-IPO New Technology Business Investment Fund		1,699		1,429			—			1,429			—
KB-TS Technology Venture Private Equity Fund		1,043		(2,775	)		—			(2,775	)		—
KB Intellectual Property Fund No.2		6,856		3,645			—			3,645			—
KB Digital Innovation Investment Fund Limited Partnership		21,176		1,703			—			1,703			—
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		11,851		1,541			—			1,541			—
KB Global Platform Fund		25,967		(6,293	)		—			(6,293	)		—
KB-UTC Inno-Tech Venture Fund		—		(905	)		(1,647	)		(2,552	)		—
WJ Private Equity Fund No.1		430		(229	)		—			(229	)		—
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		7		(4,468	)		299			(4,169	)		—
KB Smart Scale Up Fund		2,506		(11,719	)		—			(11,719	)		—
KB Scale Up Fund II		71		(308	)		—			(308	)		—
KB Bio Global Expansion Private Equity Fund No.1		2,465		2,057			—			2,057			—
KB-KTB Technology Venture Fund		134		(973	)		—			(973	)		—
KB-SOLIDUS Healthcare Investment Fund		14		(1,302	)		—			(1,302	)		—
KB New Deal Innovation Fund		327		(1,748	)		—			(1,748	)		—
All Together Korea Fund No.2		179		173			—			173			—
TMAPMOBILITY CO.,LTD.		139,793		(132,476	)		—			(132,476	)		—

113

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.2 Condensed financial information, adjustments to the carrying amount, and dividend from major investments in associates as of and for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021 *
(In millions of Korean won)	Total assets		Total liabilities		Paid-in capital		Equity			Share of net asset amount			Unrealized gains (losses) and others			Carrying amount
Korea Credit Bureau Co., Ltd.		128,297		78,328		10,000		49,969			4,497			—			4,497
Balhae Infrastructure Company		853,961		62,336		840,323		791,625			99,785			—			99,785
Incheon Bridge Co., Ltd.		560,570		690,530		61,096		(129,960	)		(19,481	)		19,481			—
KB SPROTT Renewable Private Equity Fund No.1		13,886		1,467		15,376		12,419			3,726			—			3,726
KB Digital Innovation & Growth New Technology Business Investment Fund		9,107		—		10,000		9,107			4,098			—			4,098
KB Digital Platform Fund		27,000		2		27,000		26,998			12,599			—			12,599
Future Planning KB Start-up Creation Fund		23,058		2,508		7,800		20,550			10,275			—			10,275
KB High-tech Company Investment Fund		23,722		2,736		3,000		20,986			10,493			—			10,493
Aju Good Technology Venture Fund		64,303		4,703		32,100		59,600			22,926			(5	)		22,921
KB-KDBC Pre-IPO New Technology Business Investment Fund		18,069		385		13,200		17,684			5,895			—			5,895
KB-TS Technology Venture Private Equity Fund		35,280		5,229		25,500		30,051			9,015			—			9,015
KB Intellectual Property Fund No.2		38,307		1,406		40,000		36,901			13,838			750			14,588
KB Digital Innovation Investment Fund Limited Partnership		138,678		667		136,000		138,011			35,517			—			35,517
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		69,943		221		61,100		69,722			14,834			—			14,834
KB Global Platform Fund		222,749		2,987		184,800		219,762			49,946			—			49,946
KB-UTC Inno-Tech Venture Fund		47,848		497		48,260		47,351			13,982			—			13,982
WJ Private Equity Fund No.1		35,799		170		37,100		35,629			9,604			—			9,604
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		33,499		—		35,000		33,499			9,571			—			9,571
KB Smart Scale Up Fund		124,924		55		124,000		124,869			31,217			—			31,217
KB Bio Global Expansion Private Equity Fund No.1		38,031		115		38,000		37,916			9,978			—			9,978
KB-KTB Technology Venture Fund		11,008		101		11,000		10,907			2,975			—			2,975
KB-SOLIDUS Healthcare Investment Fund		2,040		—		2,040		2,040			600			—			600
KB New Deal Innovation Fund		20,006		52		20,000		19,954			3,991			—			3,991
All Together Korea Fund No.2		10,072		1		10,001		10,071			10,070			—			10,070

114

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.2 Condensed financial information, adjustments to the carrying amount, and dividend from major investments in associates as of and for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021 *
(In millions of Korean won)	Operating revenue		Net profit (loss)			Other comprehensive income			Total comprehensive income (loss)			Dividends
Korea Credit Bureau Co., Ltd.		128,150		(27,327	)		—			(27,327	)		90
Balhae Infrastructure Company		97,833		19,559			—			19,559			9,121
Incheon Bridge Co., Ltd.		84,068		(16,219	)		—			(16,219	)		—
KB SPROTT Renewable Private Equity Fund No.1		—		(983	)		—			(983	)		—
KB Digital Innovation & Growth New Technology Business Investment Fund		3		(174	)		—			(174	)		—
KB Digital Platform Fund		—		(2	)		—			(2	)		—
Future Planning KB Start-up Creation Fund		1,941		1,502			—			1,502			—
KB High-tech Company Investment Fund		8,372		3,962			—			3,962			8,150
Aju Good Technology Venture Fund		22,486		15,407			—			15,407			—
KB-KDBC Pre-IPO New Technology Business Investment Fund		530		120			—			120			—
KB-TS Technology Venture Private Equity Fund		2,094		(1,151	)		—			(1,151	)		—
KB Intellectual Property Fund No.2		1,102		(1,411	)		—			(1,411	)		—
KB Digital Innovation Investment Fund Limited Partnership		19,411		9,786			—			9,786			—
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		14,244		8,495			—			8,495			—
KB Global Platform Fund		61,830		48,130			—			48,130			—
KB-UTC Inno-Tech Venture Fund		1,080		32			—			32			—
WJ Private Equity Fund No.1		291		(398	)		—			(398	)		—
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		716		(808	)		(667	)		(1,475	)		—
KB Smart Scale Up Fund		4,221		897			—			897			—
KB Bio Global Expansion Private Equity Fund No.1		91		(84	)		—			(84	)		—
KB-KTB Technology Venture Fund		8		(93	)		—			(93	)		—
KB New Deal Innovation Fund		6		(46	)		—			(46	)		—
All Together Korea Fund No.2		53		47			—			47			—

* The condensed financial information of the associates is adjusted to reflect adjustments, such as fair value adjustments recognized at the time of acquisition and adjustments for differences in accounting policies.

115

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.3 Changes in carrying amount of investments in associates for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning		Acquisition and others		Disposal and others			Dividends			Gains (losses) on equity- method accounting			Other comprehen- sive income (loss)			Ending
Korea Credit Bureau Co., Ltd.		4,497		—		—			—			462			—			4,959
Balhae Infrastructure Company		99,785		—		(102,554	)		(12,344	)		15,113			—			—
Incheon Bridge Co., Ltd.		—		—		—			—			—			—			—
KB SPROTT Renewable Private Equity Fund No.1		3,726		9,748		—			—			(309	)		—			13,165
KB Digital Innovation & Growth New Technology Business Investment Fund		4,098		—		—			—			(60	)		—			4,038
KB Digital Platform Fund		12,599		14,000		—			—			(1,242	)		—			25,357
KB Prime Digital Platform Fund		—		2,600		—			—			(37	)		—			2,563
Future Planning KB Start-up Creation Fund		10,275		—		(1,700	)		—			1,218			—			9,793
KB High-tech Company Investment Fund		10,493		—		—			(1,300	)		1,469			—			10,662
Aju Good Technology Venture Fund		22,921		—		(4,200	)		(1,200	)		2,315			—			19,836
KB-KDBC Pre-IPO New Technology Business Investment Fund		5,895		—		(2,600	)		—			(306	)		—			2,989
KB-TS Technology Venture Private Equity Fund		9,015		—		(2,430	)		—			805			—			7,390
KB Intellectual Property Fund No.2		14,588		—		—			—			616			—			15,204
KB Digital Innovation Investment Fund Limited Partnership		35,517		—		—			—			(517	)		—			35,000
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		14,834		—		(6,400	)		—			467			—			8,901
KB Global Platform Fund		49,946		8,000		(6,150	)		—			(1,430	)		—			50,366
KB-UTC Inno-Tech Venture Fund		13,982		—		—			—			(710	)		(486	)		12,786
WJ Private Equity Fund No.1		9,604		—		—			—			(62	)		—			9,542
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		9,571		—		—			—			(1,276	)		85			8,380
KB Smart Scale Up Fund		31,217		12,000		—			—			(2,929	)		—			40,288
KB Scale Up Fund II		—		4,500		—			—			(62	)		—			4,438
KB Bio Global Expansion Private Equity Fund No.1		9,978		—		—			—			541			—			10,519
KB-KTB Technology Venture Fund		2,975		6,000		—			—			(266	)		—			8,709

116

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.3 Changes in carrying amount of investments in associates for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2022
(In millions of Korean won)	Beginning		Acquisition and others		Disposal and others			Dividends			Gains (losses) on equity- method accounting			Other comprehen- sive income (loss)			Ending
KB-SOLIDUS Healthcare Investment Fund		600		6,000		—			—			(383	)		—			6,217
KB New Deal Innovation Fund		3,991		9,600		—			—			(350	)		—			13,241
All Together Korea Fund No.2		10,070		—		—			—			174			—			10,244
Shinla Construction Co., Ltd.		—		—		—			—			—			—			—
Terra Corporation		—		—		—			—			—			—			—
MJT&I Corp.		—		—		—			—			—			—			—
Jungdong Steel Co., Ltd.		—		—		—			—			—			—			—
DSMETAL Co., Ltd.		—		—		—			—			—			—			—
Shinhwa Underwear Co., Ltd.		198		—		—			—			(31	)		—			167
Jaeyang Industry Co., Ltd.		—		—		—			—			—			—			—
Kendae Co., Ltd.		98		—		—			—			—			—			98
Jinseung Tech Co., Ltd.		—		—		—			—			—			—			—
Dongjo Co., Ltd.		21		—		—			—			(21	)		—			—
Korea NM Tech Co., Ltd.		—		—		—			—			—			—			—
Jungdo Co., Ltd.		—		—		—			—			—			—			—
Dae-A Leisure Co., Ltd.		—		—		—			—			—			—			—
Chongil Machine & Tools Co., Ltd.		—		—		—			—			—			—			—
Imt Technology Co., Ltd.		6		—		—			—			9			—			15
Iwon Alloy Co., Ltd.		—		—		—			—			—			—			—
Carlife Co., Ltd.		13		—		(13	)		—			—			—			—
Computerlife Co., Ltd.		44		—		—			—			6			—			50
Skydigital Inc.		—		—		—			—			—			—			—
Jo Yang Industrial Co., Ltd.		—		—		—			—			—			—			—
Il-Kwang Electronic Materials Co., Ltd.		—		—		—			—			—			—			—
So-Myung Recycling Co., Ltd.		31		—		—			—			30			—			61
IDTECK Co., Ltd.		—		—		—			—			65			99			164
PIP System Co., Ltd.		—		—		—			—			—			—			—
Gwang Myung Paper Co., Ltd.		—		—		—			—			—			—			—
D-Partner		369		—		—			—			15			—			384
Inter Shipping Co., Ltd.		—		—		—			—			—			—			—
Chunsung-meat Co., Ltd.		—		—		—			—			—			—			—
DS Fashionbiz Co., Ltd.		—		—		—			—			1			—			1
ALTSCS CO., LTD.		—		—		—			—			—			—			—
E-Won Chemical Co., Ltd.		—		—		—			—			—			—			—
TMAPMOBILITY CO.,LTD.		—		200,000		—			—			(5,798	)		252			194,454
TKDS CO., LTD		—		—		—			—			—			—			—
SANDLE FARMING ASSOCIATION		—		—		—			—			—			—			—
		390,957		272,448		(126,047	)		(14,844	)		7,517			(50	)		529,981

117

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.3 Changes in carrying amount of investments in associates for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021
(In millions of Korean won)	Beginning		Acquisition and others		Disposal and others			Dividends			Gains (losses) on equity- method accounting			Other comprehen- sive income (loss)			Ending
Korea Credit Bureau Co., Ltd.		7,153		—		—			(90	)		(2,566	)		—			4,497
Balhae Infrastructure Company		106,625		279		(463	)		(9,121	)		2,465			—			99,785
KB GwS Private Securities Investment Trust		111,772		—		(111,772	)		—			—			—			—
Incheon Bridge Co., Ltd.		—		—		—			—			—			—			—
KB SPROTT Renewable Private Equity Fund No.1		4,020		—		—			—			(294	)		—			3,726
KB Digital Innovation & Growth New Technology Business Investment Fund		3,051		1,125		—			—			(78	)		—			4,098
KB Digital Platform Fund		—		12,600		—			—			(1	)		—			12,599
Future Planning KB Start-up Creation Fund		12,324		—		(2,800	)		—			751			—			10,275
KoFC POSCO Hanwha KB Shared Growth Private Equity Fund No.2		7,876		—		(7,780	)		(1,696	)		1,600			—			—
KB High-tech Company Investment Fund		19,962		—		(3,300	)		(8,150	)		1,981			—			10,493
Aju Good Technology Venture Fund		21,348		—		(4,769	)		—			6,342			—			22,921
KB-KDBC Pre-IPO New Technology Business Investment Fund		8,021		—		(2,400	)		—			274			—			5,895
KB-TS Technology Venture Private Equity Fund		9,445		1,650		(2,880	)		—			800			—			9,015
KB Intellectual Property Fund No.2		15,000		—		—			—			(412	)		—			14,588
KB Digital Innovation Investment Fund Limited Partnership		34,749		—		—			—			768			—			35,517
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		13,756		5,000		(5,400	)		—			1,478			—			14,834
KB Global Platform Fund		28,007		13,500		—			—			8,439			—			49,946
KB-UTC Inno-Tech Venture Fund		11,332		3,390		(750	)		—			10			—			13,982
WJ Private Equity Fund No.1		9,711		—		—			—			(107	)		—			9,604
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		2,493		7,500		—			—			(231	)		(191	)		9,571
KB Smart Scale Up Fund		3,993		27,000		—			—			224			—			31,217
KB Bio Global Expansion Private Equity Fund No.1		—		10,000		—			—			(22	)		—			9,978
KB-KTB Technology Venture Fund		—		3,000		—			—			(25	)		—			2,975

118

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.3 Changes in carrying amount of investments in associates for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021
(In millions of Korean won)	Beginning		Acquisition and others		Disposal and others			Dividends			Gains (losses) on equity- method accounting			Other comprehen- sive income (loss)		Ending
KB-SOLIDUS Healthcare Investment Fund		—		600		—			—			—			—		600
KB New Deal Innovation Fund		—		4,000		—			—			(9	)		—		3,991
All Together Korea Fund No.2		10,023		—		—			—			47			—		10,070
Shinla Construction Co., Ltd.		—		—		—			—			—			—		—
Terra Corporation		—		—		—			—			—			—		—
MJT&I Corp.		113		—		—			—			(113	)		—		—
Jungdong Steel Co., Ltd.		—		—		—			—			—			—		—
DSMETAL Co., Ltd.		—		—		—			—			—			—		—
Shinhwa Underwear Co., Ltd.		222		—		—			—			(24	)		—		198
DPAPS Co., Ltd.		—		—		—			—			—			—		—
Jaeyang Industry Co., Ltd.		—		—		—			—			—			—		—
Kendae Co., Ltd.		98		—		—			—			—			—		98
Jinseung Tech Co., Ltd.		—		—		—			—			—			—		—
Dongjo Co., Ltd.		18		—		—			—			3			—		21
Korea NM Tech Co., Ltd.		—		—		—			—			—			—		—
Jungdo Co., Ltd.		—		—		—			—			—			—		—
Dae-A Leisure Co., Ltd.		149		—		—			—			(149	)		—		—
Chongil Machine & Tools Co., Ltd.		—		—		—			—			—			—		—
Imt Technology Co., Ltd.		—		—		—			—			6			—		6
Iwon Alloy Co., Ltd.		—		—		—			—			—			—		—
Carlife Co., Ltd.		11		—		—			—			2			—		13
Computerlife Co., Ltd.		48		—		—			—			(4	)		—		44
Skydigital Inc.		—		—		—			—			—			—		—
Jo Yang Industrial Co., Ltd.		—		—		—			—			—			—		—
Il-Kwang Electronic Materials Co., Ltd.		—		—		—			—			—			—		—
So-Myung Recycling Co., Ltd.		5		—		—			—			26			—		31
IDTECK Co., Ltd.		—		—		—			—			—			—		—
PIP System Co., Ltd.		—		—		—			—			—			—		—
Neomio Corp.		—		—		—			—			—			—		—
Gwang Myung Paper Co., Ltd.		—		—		—			—			—			—		—
D-Partner		—		—		—			—			(49	)		418		369
Inter Shipping Co., Ltd.		—		—		—			—			—			—		—
Chunsung-meat Co., Ltd.		—		—		—			—			—			—		—
DS Fashionbiz Co., Ltd.		—		—		—			—			—			—		—
		441,325		89,644		(142,314	)		(19,057	)		21,132			227		390,957

119

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

13.4 Unrecognized share of losses of investments in associates and joint ventures due to the discontinuation of recognizing share of losses, for the years ended December 31, 2022 and 2021, and accumulated amount of unrecognized losses as of December 31, 2022 and 2021, are as follows:

	Unrecognized losses for the period						Accumulated unrecognized losses
(In millions of Korean won)	2022			2021			December 31, 2022		December 31, 2021
Incheon Bridge Co., Ltd.		(3,518	)		1,381			15,963		19,481
Shinla Construction Co., Ltd.		—			—			183		183
Terra Corporation		—			—			14		14
MJT&I Corp.		1			152			153		152
Jungdong Steel Co., Ltd.		—			—			487		487
DSMETAL Co., Ltd.		—			38			103		103
Jaeyang Industry Co., Ltd.		—			—			30		30
Jinseung Tech Co., Ltd.		(15	)		12			18		33
Dongjo Co., Ltd.		696			—			696		—
Korea NM Tech Co., Ltd.		3			(1	)		31		28
Jungdo Co., Ltd.		(8	)		237			539		547
Dae-A Leisure Co., Ltd.		310			202			512		202
Chongil Machine & Tools Co., Ltd.		7			45			71		64
Imt Technology Co., Ltd.		—			(3	)		—		—
Iwon Alloy Co., Ltd.		19			—			19		—
Skydigital Inc.		3			68			176		173
Jo Yang Industrial Co., Ltd.		7			8			111		104
Il-Kwang Electronic Materials Co., Ltd.		(2	)		160			158		160
IDTECK Co., Ltd.		(144	)		(72	)		—		144
Inter Shipping Co., Ltd.		1,022			117			1,139		117
Chunsung-meat co., ltd.		24			—			24		—
ALTSCS CO., LTD.		1			—			1		—
		(1,594	)		2,344			20,428		22,022

120

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

14. Property and Equipment, and Investment Properties

14.1 Property and Equipment

14.1.1 Details of property and equipment as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Acquisition cost		Accumulated depreciation			Accumulated impairment losses			Carrying amount
Land		2,017,250		—			(4	)		2,017,246
Buildings		1,811,998		(585,729	)		(5,747	)		1,220,522
Leasehold improvements		905,404		(852,017	)		—			53,387
Equipment and vehicles		1,318,278		(1,164,583	)		—			153,695
Construction in-progress		5,829		—			—			5,829
Right-of-use assets		1,084,579		(697,747	)		—			386,832
		7,143,338		(3,300,076	)		(5,751	)		3,837,511

	December 31, 2021
(In millions of Korean won)	Acquisition cost		Accumulated depreciation			Accumulated impairment losses			Carrying amount
Land		2,063,213		—			(4	)		2,063,209
Buildings		1,784,823		(559,430	)		(5,747	)		1,219,646
Leasehold improvements		869,957		(806,283	)		—			63,674
Equipment and vehicles		1,396,243		(1,228,189	)		—			168,054
Construction in-progress		28,226		—			—			28,226
Right-of-use assets		957,169		(566,035	)		—			391,134
		7,099,631		(3,159,937	)		(5,751	)		3,933,943

14.1.2 Changes in property and equipment for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning		Acquisition		Transfer 2			Disposal			Depreciation			Others			Ending
Land		2,063,209		676		(32,963	)		(6,083	)		—			(7,593	)		2,017,246
Buildings		1,219,646		2,143		49,756			(3,818	)		(47,169	)		(36	)		1,220,522
Leasehold Improvements		63,674		2,237		33,738			(114	)		(46,425	)		277			53,387
Equipment and vehicles		168,054		89,512		528			(1,794	)		(102,763	)		158			153,695
Construction in-progress		28,226		94,259		(116,205	)		(397	)		—			(54	)		5,829
Right-of-use assets 1		391,134		555,071		255			(390,474	)		(209,247	)		40,093			386,832
		3,933,943		743,898		(64,891	)		(402,680	)		(405,604	)		32,845			3,837,511

121

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

14.1.2 Changes in property and equipment for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021
(In millions of Korean won)	Beginning		Acquisition		Transfer 2			Disposal			Depreciation			Others			Ending
Land		2,081,872		1,106		(42,175	)		(731	)		—			23,137			2,063,209
Buildings		1,249,542		1,237		12,248			(3,869	)		(45,465	)		5,953			1,219,646
Leasehold Improvements		69,214		1,841		39,453			(736	)		(46,774	)		676			63,674
Equipment and vehicles		190,842		87,034		2,743			(981	)		(114,625	)		3,041			168,054
Construction in-progress		34,275		107,463		(92,288	)		(8,435	)		—			(12,789	)		28,226
Right-of-use assets 1		416,149		489,810		—			(306,818	)		(214,738	)		6,731			391,134
		4,041,894		688,491		(80,019	)		(321,570	)		(421,602	)		26,749			3,933,943

¹  Effect of change in the lease term is reflected in acquisition and disposal based on gross amount.

²  Includes transfers with investment properties and assets held for sale.

14.1.3 Changes in accumulated impairment losses of property and equipment for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning			Impairment		Reversal		Others		Ending
Accumulated impairment losses of property and equipment		(5,751	)		—		—		—		(5,751	)

	2021
(In millions of Korean won)	Beginning			Impairment		Reversal		Others		Ending
Accumulated impairment losses of property and equipment		(6,877	)		—		—		1,126		(5,751	)

14.2 Investment Properties

14.2.1 Details of investment properties as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Acquisition cost		Accumulated depreciation			Carrying amount
Land		230,597		—			230,597
Buildings		132,879		(18,320	)		114,559
		363,476		(18,320	)		345,156

	December 31, 2021
(In millions of Korean won)	Acquisition cost		Accumulated depreciation			Carrying amount
Land		222,648		—			222,648
Buildings		112,377		(9,960	)		102,417
		335,025		(9,960	)		325,065

122

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

14.2.2 Valuation techniques and inputs used to measure the fair value of investment properties as of December 31, 2022, are as follows:

	December 31, 2022
(In millions of Korean won)	Fair value		Valuation techniques	Inputs
Land and buildings		194,157	Cost approach method	- Price per square meter - Replacement cost
		233,850	Income approach method	- Discount rate - Capitalization rate - Vacancy rate

Fair value of investment properties amounts to W 428,007 million and W 383,249 million as of December 31, 2022 and 2021, respectively. Investment properties are measured by qualified independent appraisers with recent experience in valuing similar properties in the same area. In addition, all investment properties are classified as Level 3 in accordance with fair value hierarchy in Note 6.1.2.

Rental income from above investment properties amounts to W 5,441 million and W 4,477 million for the years ended December 31, 2022 and 2021, respectively.

14.2.3 Changes in investment properties for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning		Acquisition		Transfer		Disposal		Depreciation			Ending
Land		222,648		—		7,949		—		—			230,597
Buildings		102,417		—		13,800		—		(1,658	)		114,559
		325,065		—		21,749		—		(1,658	)		345,156

	2021
(In millions of Korean won)	Beginning		Acquisition		Transfer		Disposal		Depreciation			Ending
Land		218,157		—		4,491		—		—			222,648
Buildings		99,944		—		3,664		—		(1,191	)		102,417
		318,101		—		8,155		—		(1,191	)		325,065

123

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

15. Intangible Assets

15.1 Details of intangible assets as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Acquisition cost		Accumulated amortization			Accumulated impairment losses			Others		Carrying amount
Goodwill		552,652		—			(1,202	)		12,789		564,239
Other intangible assets		1,732,425		(1,226,990	)		(14,978	)		—		490,457
		2,285,077		(1,226,990	)		(16,180	)		12,789		1,054,696

	December 31, 2021
(In millions of Korean won)	Acquisition cost		Accumulated amortization			Accumulated impairment losses			Others			Carrying amount
Goodwill		552,652		—			(1,202	)		(11,745	)		539,705
Other intangible assets		1,579,448		(1,075,514	)		(15,145	)		—			488,789
		2,132,100		(1,075,514	)		(16,347	)		(11,745	)		1,028,494

15.2 Details of goodwill as of December 31, 2022 and 2021, are as follows:

	December 31, 2022				December 31, 2021
(In millions of Korean won)	Acquisition cost		Carrying amount *		Acquisition cost		Carrying amount *
PT Bank KB Bukopin Tbk		89,220		83,619		89,220		85,893
PRASAC Microfinance Institution Plc.		396,942		415,332		396,942		388,524
Housing & Commercial Bank		65,288		65,288		65,288		65,288
Kookmin Bank Cambodia Plc.		1,202		—		1,202		—
		552,652		564,239		552,652		539,705

* Includes the effect of exchange differences.

15.3 Changes in accumulated impairment losses of goodwill for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning			Impairment		Others		Ending
Accumulated impairment losses of goodwill		(1,202	)		—		—		(1,202	)

	2021
(In millions of Korean won)	Beginning			Impairment		Others		Ending
Accumulated impairment losses of goodwill		(1,202	)		—		—		(1,202	)

124

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

15.4 Details of goodwill allocation to cash-generating units and related information for impairment testing as of December 31, 2022 are as follows:

	December 31, 2022
(In millions of Korean won)	Retail banking		Corporate banking		PT Bank KB Bukopin Tbk		PRASAC Microfinance Institution Plc.		Total
Carrying amounts *		49,315		15,973		83,619		470,227		619,134
Recoverable amount exceeding carrying amount		5,778,171		2,905,282		582,823		122,207		9,388,483
Discount rate (%)		16.60		17.01		20.16		30.40
Permanent growth rate (%)		1.00		1.00		3.00		3.00

* The carrying amount of goodwill at the time of the impairment test

For impairment testing, goodwill is allocated to cash-generating units that are expected to benefit from the synergies of the business combination, and cash-generating units consist of an operating segment or units which are not larger than an operating segment. The Group recognized goodwill amounting to \ 65,288 million arising from the merger of Housing & Commercial Bank, the amounts of \ 49,315 million and \ 15,973 million were allocated to the retail banking and corporate banking, respectively. The Group acquired a 70% stake in PRASAC Microfinance Institution Plc. with the acquisition date of April 10, 2020, and the goodwill recognized due to the business combination is \ 415,332 million as of December 31, 2022. The Group acquired a 67% stake in PT Bank KB Bukopin Tbk with the acquisition date of September 2, 2020, and the goodwill recognized due to the business combination is \ 83,619 million as of December 31, 2022. Cash-generating units to which goodwill has been allocated is tested for impairment annually and whenever there is an indication that the unit may be impaired, by comparing the carrying amount of the unit including the goodwill with the recoverable amount of the unit. The valuation dates of the recoverable amounts of the PRASAC Microfinance PLC. and PT Bank KB Bukopin TBK are September 30, 2022 and December 31, 2022, respectively.

The recoverable amount of a cash-generating unit is measured at the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal is the amount obtainable from the disposal in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal. If it is difficult to measure the amount obtainable from the disposal of the cash-generating unit, the disposal amount of a similar cash-generating unit in the past transaction is used by reflecting the characteristics of the cash-generating unit to be measured. If it is not possible to obtain reliable information to measure the fair value less costs of disposal, the Group uses the asset’s value in use as its recoverable amount. Value in use is the present value of the future cash flows expected to be derived from an asset or cash-generating unit. The estimated future cash flows are based on the most recent financial budget approved by management with maximum period of 5 years. The future cash flows of retail banking and corporate banking after the projection period are estimated on the assumption that the future cash flows will increase by 1.0% per year. The key assumptions used for the estimation of the future cash flows are based on the market size and the Group’s market share.

The future cash flows of PRASAC Microfinance Institution Plc. after five years are estimated on the assumption that the future cash flows will increase by 3.0% per year. The future cash flows of PT Bank KB Bukopin Tbk after four years are estimated on the assumption that the future cash flows will increase by 3.0% per year. The key assumptions used for the estimation of the future cash flows are the GDP growth rate and the market size of Cambodia and Indonesia, and the recent growth rate of PRASAC Microfinance Institution Plc. and PT Bank KB Bukopin Tbk. The discount rate is a pre-tax rate that reflects assumptions regarding risk-free interest rate, market risk premium, and the risks specific to the cash-generating unit.

125

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

15.5 Details of intangible assets other than goodwill as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Acquisition cost		Accumulated amortization			Accumulated impairment losses			Carrying amount
Industrial property rights		2,406		(2,106	)		—			300
Software		1,416,325		(1,052,909	)		—			363,416
Other intangible assets		278,567		(139,450	)		(14,978	)		124,139
Right-of-use assets		35,127		(32,525	)		—			2,602
		1,732,425		(1,226,990	)		(14,978	)		490,457

	December 31, 2021
(In millions of Korean won)	Acquisition cost		Accumulated amortization			Accumulated impairment losses			Carrying amount
Industrial property rights		2,187		(1,963	)		—			224
Software		1,247,629		(916,777	)		—			330,852
Other intangible assets		294,505		(125,257	)		(15,145	)		154,103
Right-of-use assets		35,127		(31,517	)		—			3,610
		1,579,448		(1,075,514	)		(15,145	)		488,789

15.6 Changes in intangible assets other than goodwill for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning		Acquisition		Transfer		Disposal			Amortization			Others			Ending
Industrial property rights		224		193		—		(1	)		(117	)		1			300
Software		330,852		170,141		818		—			(138,741	)		346			363,416
Other intangible assets		154,103		2,799		—		(245	)		(31,822	)		(696	)		124,139
Right-of-use assets		3,610		—		—		—			(1,007	)		(1	)		2,602
		488,789		173,133		818		(246	)		(171,687	)		(350	)		490,457

	2021
(In millions of Korean won)	Beginning		Acquisition		Disposal			Amortization			Others		Ending
Industrial property rights		234		107		—			(117	)		—		224
Software		313,426		129,684		—			(114,225	)		1,967		330,852
Other intangible assets		142,517		50,524		(1,834	)		(38,236	)		1,132		154,103
Right-of-use assets		4,617		—		—			(1,007	)		—		3,610
		460,794		180,315		(1,834	)		(153,585	)		3,099		488,789

126

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

15.7 Changes in accumulated impairment losses of other intangible assets for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning			Impairment		Reversal		Others		Ending
Accumulated impairment losses of other intangible assets		(15,145	)		—		—		167		(14,978	)

	2021
(In millions of Korean won)	Beginning			Impairment			Reversal		Others		Ending
Accumulated impairment losses of other intangible assets		(10,215	)		(4,971	)		—		41		(15,145	)

16. Deferred Income Tax Assets and Liabilities

16.1 Details of deferred income tax assets and liabilities as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Assets			Liabilities			Net amount
Other provisions		86,237			—			86,237
Impairment losses of property and equipment		5,155			—			5,155
Share-based payments		13,112			—			13,112
Provisions for acceptances and guarantees		39,787			—			39,787
Gains or losses on valuation of derivatives		—			(147,750	)		(147,750	)
Present value discount		95			—			95
Gains or losses on fair value hedge		—			(93,833	)		(93,833	)
Accrued interest		—			(72,868	)		(72,868	)
Deferred loan origination fees and costs		10,377			(115,553	)		(105,176	)
Gains or losses on revaluation		—			(261,502	)		(261,502	)
Investments in subsidiaries and others		37,802			(179,329	)		(141,527	)
Gains or losses on valuation of security investment		245,988			—			245,988
Defined benefit liabilities		380,726			—			380,726
Accrued expenses		172,345			—			172,345
Retirement insurance expense		—			(459,323	)		(459,323	)
Adjustments to the prepaid contributions		—			(27,986	)		(27,986	)
Others		637,476			(243,543	)		393,933
		1,629,100			(1,601,687	)		27,413
Offsetting of deferred income tax assets and liabilities		(1,447,843	)		1,447,843			—
		181,257			(153,844	)		27,413

127

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

16.1 Details of deferred income tax assets and liabilities as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021
(In millions of Korean won)	Assets			Liabilities			Net amount
Other provisions		77,907			—			77,907
Impairment losses of property and equipment		7,446			—			7,446
Share-based payments		15,687			—			15,687
Provisions for acceptances and guarantees		33,091			—			33,091
Gains or losses on valuation of derivatives		—			(74,111	)		(74,111	)
Present value discount		—			(142	)		(142	)
Gains or losses on fair value hedge		—			(14,642	)		(14,642	)
Accrued interest		—			(42,882	)		(42,882	)
Deferred loan origination fees and costs		8,596			(138,398	)		(129,802	)
Gains or losses on revaluation		—			(277,471	)		(277,471	)
Investments in subsidiaries and others		32,602			(138,609	)		(106,007	)
Gains or losses on valuation of security investment		—			(501,409	)		(501,409	)
Defined benefit liabilities		472,722			—			472,722
Accrued expenses		148,726			—			148,726
Retirement insurance expense		—			(441,633	)		(441,633	)
Adjustments to the prepaid contributions		—			(29,273	)		(29,273	)
Others		434,703			(124,602	)		310,101
		1,231,480			(1,783,172	)		(551,692	)
Offsetting of deferred income tax assets and liabilities		(1,081,611	)		1,081,611			—
		149,869			(701,561	)		(551,692	)

16.2 Unrecognized Deferred Income Tax Assets

16.2.1 No deferred income tax assets have been recognized for the deductible temporary differences of W 1,099,572 million and W 327,040 million associated with investments in subsidiaries and others as of December 31, 2022 and 2021, because it is not probable that these temporary differences will reverse in the foreseeable future.

16.2.2 No deferred income tax assets have been recognized for the deductible temporary differences of W 34,908 million and W 39,821 million associated with others as of December 31, 2022 and 2021 due to the uncertainty that these temporary differences will be realized in the future.

16.3 Unrecognized Deferred Income Tax Liabilities

16.3.1 No deferred income tax liabilities have been recognized for the taxable temporary differences of W 443,216 million and W 313,586 million associated with investments in subsidiaries and others as of December 31, 2022 and 2021, due to the following reasons:

• The Group is able to control the timing of the reversal of the temporary differences.

• It is probable that these temporary differences will not reverse in the foreseeable future.

16.3.2 No deferred income tax liabilities have been recognized as of December 31, 2022 and 2021 for the taxable temporary differences of W 65,288 million related to the initial recognition of goodwill arising from the merger of Housing and Commercial Bank in 2001.

128

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

16.4 Changes in cumulative temporary differences for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning			Decrease			Increase			Ending
Deductible temporary differences
Other provisions		283,299			276,213			318,336			325,422
Impairment losses of property and equipment		27,076			19,880			12,257			19,453
Deferred loan origination fees and costs		31,256			12,726			20,630			39,160
Share-based payments		57,042			57,042			49,479			49,479
Provisions for acceptances and guarantees		120,332			120,332			150,140			150,140
Present value discount		—			—			358			358
Investments in subsidiaries and others		445,595			30,441			827,068			1,242,222
Gains or losses on valuation of security investment		—			—			928,258			928,258
Defined benefit liabilities		1,718,990			292,478			10,188			1,436,700
Accrued expenses		540,823			540,823			650,357			650,357
Others		1,250,634			544,021			1,113,913			1,820,526
		4,475,047			1,893,956			4,080,984			6,662,075
Unrecognized deferred income tax assets
Investments in subsidiaries and others		327,040									1,099,572
Others		39,821									34,908
		4,108,186									5,527,595
Tax rate (%)		27.50									26.50
		1,129,751									1,464,813
Tax loss carryforwards and tax credit		101,729			—			62,558			164,287
Total deferred income tax assets		1,231,480									1,629,100
Taxable temporary differences
Gains or losses on fair value hedge		(53,243	)		(53,243	)		(354,085	)		(354,085	)
Accrued interest		(155,936	)		(119,589	)		(238,628	)		(274,975	)
Deferred loan origination fees and costs		(503,266	)		(503,266	)		(436,047	)		(436,047	)
Gains or losses on valuation of derivatives		(269,493	)		(269,493	)		(558,566	)		(558,566	)
Present value discount		(517	)		(517	)		—			—
Goodwill arising from the merger		(65,288	)		—			—			(65,288	)
Gains or losses on revaluation		(1,008,984	)		(22,184	)		—			(986,800	)
Investments in subsidiaries and others		(817,618	)		—			(302,312	)		(1,119,930	)
Gains or losses on valuation of security investment		(1,823,307	)		(1,823,307	)		—			—
Retirement insurance expense		(1,605,940	)		(237,587	)		(364,944	)		(1,733,297	)
Adjustments to the prepaid contributions		(106,446	)		(106,446	)		(105,608	)		(105,608	)
Others		(453,098	)		(329,376	)		(794,289	)		(918,011	)
		(6,863,136	)		(3,465,008	)		(3,154,479	)		(6,552,607	)
Unrecognized deferred income tax liabilities
Goodwill arising from the merger		(65,288	)								(65,288	)
Investments in subsidiaries and others		(313,586	)								(443,216	)
		(6,484,262	)								(6,044,103	)
Tax rate (%)		27.50									26.50
Total deferred income tax liabilities		(1,783,172	)								(1,601,687	)

129

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

16.4 Changes in cumulative temporary differences for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021
(In millions of Korean won)	Beginning			Decrease			Increase			Ending
Deductible temporary differences
Gains or losses on fair value hedge		76,583			76,583			—			—
Other provisions		284,825			283,770			282,244			283,299
Impairment losses of property and equipment		8,148			4,362			23,290			27,076
Deferred loan origination fees and costs		24,270			11,722			18,708			31,256
Share-based payments		42,361			42,361			57,042			57,042
Provisions for acceptances and guarantees		61,984			61,984			120,332			120,332
Investments in subsidiaries and others		308,534			180,735			317,796			445,595
Defined benefit liabilities		1,618,597			182,536			282,929			1,718,990
Accrued expenses		765,387			765,387			540,823			540,823
Others		1,201,141			509,685			559,178			1,250,634
		4,391,830			2,119,125			2,202,342			4,475,047
Unrecognized deferred income tax assets
Investments in subsidiaries and others		188,609									327,040
Others		23,826									39,821
		4,179,395									4,108,186
Tax rate (%)		27.50									27.50
		1,149,334									1,129,751
Tax loss carryforwards and tax credit		20,537			—			81,192			101,729
Total deferred income tax assets		1,169,871									1,231,480
Taxable temporary differences
Gains or losses on fair value hedge		—			—			(53,243	)		(53,243	)
Accrued interest		(127,345	)		(111,820	)		(140,411	)		(155,936	)
Deferred loan origination fees and costs		(510,055	)		(510,055	)		(503,266	)		(503,266	)
Gains or losses on valuation of derivatives		(335,740	)		(335,740	)		(269,493	)		(269,493	)
Present value discount		(49	)		(49	)		(517	)		(517	)
Goodwill arising from the merger		(65,288	)		—			—			(65,288	)
Gains or losses on revaluation		(1,008,984	)		—			—			(1,008,984	)
Investments in subsidiaries and others		(595,065	)		(116,061	)		(338,614	)		(817,618	)
Gains or losses on valuation of security investment		(967,057	)		(967,057	)		(1,823,307	)		(1,823,307	)
Retirement insurance expense		(1,462,643	)		(178,936	)		(322,233	)		(1,605,940	)
Adjustments to the prepaid contributions		(102,768	)		(102,768	)		(106,446	)		(106,446	)
Others		(415,278	)		(340,613	)		(378,433	)		(453,098	)
		(5,590,272	)		(2,663,099	)		(3,935,963	)		(6,863,136	)
Unrecognized deferred income tax liabilities
Goodwill arising from the merger		(65,288	)								(65,288	)
Investments in subsidiaries and others		(221,773	)								(313,586	)
		(5,303,211	)								(6,484,262	)
Tax rate (%)		27.50									27.50
Total deferred income tax liabilities		(1,458,382	)								(1,783,172	)

130

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

17. Assets Held for Sale

17.1 Details of assets held for sale as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Acquisition cost *		Accumulated impairment losses			Carrying amount		Fair value less costs to sell
Land held for sale		106,348		(20,394	)		85,954		104,990
Buildings held for sale		162,974		(38,870	)		124,104		137,706
Other assets held for sale		4,546		(2,847	)		1,699		1,699
		273,868		(62,111	)		211,757		244,395
	December 31, 2021
(In millions of Korean won)	Acquisition cost *		Accumulated impairment losses			Carrying amount		Fair value less costs to sell
Land held for sale		115,099		(16,528	)		98,571		135,192
Buildings held for sale		170,892		(36,923	)		133,969		149,569
Other assets held for sale		10,142		(5,364	)		4,778		4,778
		296,133		(58,815	)		237,318		289,539

* Acquisition cost of buildings held for sale is net of accumulated depreciation amount immediately before the initial classification of the assets as held for sale.

17.2 Valuation techniques and inputs used to measure the fair value of assets held for sale as of December 31, 2022 are as follows:

	December 31, 2022
(In millions of Korean won)	Fair value	Valuation techniques 1	Unobservable inputs 2	Estimated range of unobservable inputs (%)	Effect of unobservable inputs to fair value
Land and buildings	244,395	Market comparison approach model and others	Adjustment index	0.32 ~ 2.21	Fair value increases as the adjustment index rises

¹ The appraisal value is adjusted by the adjustment ratio in the event the public sale is unsuccessful.

² Adjustment index is calculated using the time factor correction or individual factors.

Among assets held for sale, real estate was measured by independent appraisers with professional qualifications and recent experience in evaluating similar properties in the area of the property to be assessed. All assets held for sale are classified as Level 3 in accordance with fair value hierarchy in Note 6.1.2.

131

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

17.3 Changes in accumulated impairment losses of assets held for sale for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning			Provision			Reversal		Others			Ending
Accumulated impairment losses of assets held for sale		(58,815	)		(5,752	)		6,507		(4,051	)		(62,111	)
	2021
(In millions of Korean won)	Beginning			Provision			Reversal		Others			Ending
Accumulated impairment losses of assets held for sale		(46,115	)		(15,490	)		—		2,790			(58,815	)

17.4 As of December 31, 2022, assets held for sale consist of 11 real estates of closed offices and 1 real estate of Orient Kwang-yang Co., Ltd., 438 foreclosure assets on loans of PT Bank KB Bukopin Tbk, which were determined to sell by management, but not yet sold as of December 31, 2022. The remaining 450 assets are also being actively marketed.

18. Other Assets

18.1 Details of other assets as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Other financial assets
Other receivables		3,516,361			2,451,049
Accrued income		1,510,141			950,095
Guarantee deposits		822,060			872,225
Domestic exchange settlement debits		861,741			989,551
Others		34,249			32,009
Less: Allowances for credit losses		(33,461	)		(16,305	)
Present value discount		(1,464	)		(1,397	)
		6,709,627			5,277,227
Other non-financial assets
Other receivables		307			310
Prepaid expenses		260,584			195,109
Guarantee deposits		2,483			2,703
Prepayments		21,456			28,856
Others		94,934			87,729
Less: Allowances for credit losses		(10,966	)		(8,587	)
		368,798			306,120
		7,078,425			5,583,347

132

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

18.2 Changes in allowances for credit losses of other assets for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Other financial assets			Other non- financial assets			Total
Beginning		16,305			8,587			24,892
Provision (reversal)		3,647			2,203			5,850
Write-offs		(4,502	)		(70	)		(4,572	)
Others		18,011			246			18,257
Ending		33,461			10,966			44,427
	2021
(In millions of Korean won)	Other financial assets			Other non- financial assets			Total
Beginning		18,476			9,865			28,341
Provision (reversal)		1,663			(379	)		1,284
Write-offs		(5,213	)		(2,762	)		(7,975	)
Others		1,379			1,863			3,242
Ending		16,305			8,587			24,892

19. Deposits

Details of deposits as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Demand deposits
Demand deposits in Korean won		147,976,208			174,210,942
Demand deposits in foreign currencies		12,053,947			15,192,711
		160,030,155			189,403,653
Time deposits
Time deposits in Korean won		191,747,094			153,934,550
Time deposits in foreign currencies		23,652,215			15,688,844
Fair value adjustments of fair value hedged time deposits in foreign currencies		(8,591	)		(1,319	)
		215,390,718			169,622,075
Certificates of deposits		6,325,876			4,115,688
		381,746,749			363,141,416

133

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

20. Borrowings

20.1 Details of borrowings as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
General borrowings		36,815,211		30,051,040
Bonds sold under repurchase agreements and others		4,933,903		834,455
Call money		3,324,003		1,637,666
		45,073,117		32,523,161

20.2 Details of general borrowings as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		Lenders	Annual interest rate (%)		December 31, 2022		December 31, 2021
Borrowings in Korean won	Borrowings from the Bank of Korea	The Bank of Korea		0.25~1.75		8,282,289		7,131,019
	Borrowings from the government	SEMAS and others		0.00~3.23		2,670,867		2,683,056
	Borrowings from non-banking financial institutions	The Korea Development Bank		1.39~2.64		477,788		432,310
	Other borrowings	The Korea Development Bank and others		0.00~5.61		5,397,514		5,460,862
						16,828,458		15,707,247
Borrowings in foreign currencies	Due to banks	BANK OF CHINA SEOUL BRANCH and others		0.00		18,266		2,143
	Borrowings from banks	Central Bank of Uzbekistan and others		0.00~14.00		14,620,544		12,364,349
	Borrowings from other financial institutions	The Export-Import Bank of Korea and others		5.07~5.89		38,249		24,867
	Other borrowings	Standard Chartered Bank and others		0.00~5.54		5,309,694		1,952,434
						19,986,753		14,343,793
						36,815,211		30,051,040

20.3 Details of bonds sold under repurchase agreements and others as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Lenders	Annual interest rate (%)		December 31, 2022		December 31, 2021
Bonds sold under repurchase agreements	Individuals, groups, and corporations		0.00~9.75		4,930,103		832,353
Bills sold	Counter sale		1.55~2.00		3,800		2,102
					4,933,903		834,455

134

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

20.4 Details of call money as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Lenders	Annual interest rate (%)		December 31, 2022		December 31, 2021
Call money in Korean won	Mitsui Sumitomo Bank Seoul		2.99~3.23		2,113,500		—
Call money in foreign currencies	Bank CIMB Niaga and others		0.00~7.80		1,210,503		1,637,666
					3,324,003		1,637,666

21. Debentures

21.1 Details of debentures as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Annual interest rate (%)		December 31, 2022			December 31, 2021
Debentures in Korean won
Structured debentures		5.65~8.62		30,710			30,910
Subordinated fixed rate debentures		2.02~7.86		4,089,890			5,292,957
Fixed rate debentures		0.99~13.70		12,204,848			11,276,086
Floating rate debentures		1.54~4.01		4,100,000			5,310,000
				20,425,448			21,909,953
Fair value adjustments of fair value hedged debentures in Korean won				(249,630	)		(79,877	)
Less: Discount on debentures in Korean won				(7,371	)		(14,685	)
				20,168,447			21,815,391
Debentures in foreign currencies
Floating rate debentures		2.42~5.98		1,312,914			1,948,962
Fixed rate debentures		0.05~12.00		8,434,760			5,949,105
				9,747,674			7,898,067
Fair value adjustments of fair value hedged debentures in foreign currencies				(95,865	)		27,952
Less: Discount on debentures in foreign currencies				(32,534	)		(22,676	)
				9,619,275			7,903,343
				29,787,722			29,718,734

135

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

21.2 Changes in debentures based on par value for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning		Issue		Repayment			Others		Ending
Debentures in Korean won
Structured debentures		30,910		—		(200	)		—		30,710
Subordinated fixed rate debentures		5,292,957		—		(1,203,067	)		—		4,089,890
Fixed rate debentures		11,276,086		12,883,950		(11,955,188	)		—		12,204,848
Floating rate debentures		5,310,000		4,960,000		(6,170,000	)		—		4,100,000
		21,909,953		17,843,950		(19,328,455	)		—		20,425,448
Debentures in foreign currencies
Floating rate debentures		1,948,962		755,815		(1,597,630	)		205,767		1,312,914
Fixed rate debentures		5,949,105		3,354,673		(1,113,994	)		244,976		8,434,760
		7,898,067		4,110,488		(2,711,624	)		450,743		9,747,674
		29,808,020		21,954,438		(22,040,079	)		450,743		30,173,122
	2021
(In millions of Korean won)	Beginning		Issue		Repayment			Others		Ending
Debentures in Korean won
Structured debentures		31,960		—		(1,050	)		—		30,910
Subordinated fixed rate debentures		4,464,407		830,000		(1,450	)		—		5,292,957
Fixed rate debentures		14,823,854		10,592,620		(14,140,388	)		—		11,276,086
Floating rate debentures		1,890,000		5,310,000		(1,890,000	)		—		5,310,000
		21,210,221		16,732,620		(16,032,888	)		—		21,909,953
Debentures in foreign currencies
Floating rate debentures		1,353,472		810,920		(350,235	)		134,805		1,948,962
Fixed rate debentures		4,359,842		2,489,034		(1,134,987	)		235,216		5,949,105
		5,713,314		3,299,954		(1,485,222	)		370,021		7,898,067
		26,923,535		20,032,574		(17,518,110	)		370,021		29,808,020

22. Provisions

22.1 Details of provisions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Provisions for credit losses of unused loan commitments		161,331		147,765
Provisions for credit losses of acceptances and guarantees		153,843		121,148
Provisions for restoration costs		135,477		128,407
Others		82,719		29,547
		533,370		426,867

136

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

22.2 Changes in provisions for credit losses of unused loan commitments, and acceptances and guarantees for the years ended December 31, 2022 and 2021, are as follows:

	2022
	Provisions for credit losses of unused loan commitments									Provisions for credit losses of acceptances and guarantees
	12-month expected credit losses			Lifetime expected credit losses						12-month expected credit losses			Lifetime expected credit losses
(In millions of Korean won)				Non- impaired			Impaired						Non- impaired			Impaired
Beginning		94,183			53,582			—			27,441			82,170			11,537
Transfer between stages:
Transfer to 12-month expected credit losses		22,761			(22,731	)		(30	)		1,144			(1,144	)		—
Transfer to lifetime expected credit losses		(15,265	)		15,357			(92	)		(355	)		1,016			(661	)
Impairment		(133	)		(470	)		603			(9	)		(142	)		151
Provision (reversal) for credit losses		1,934			10,855			(457	)		(1,422	)		33,983			(3,261	)
Others (exchange differences, etc.)		317			937			(20	)		418			2,842			135
Ending		103,797			57,530			4			27,217			118,725			7,901
	2021
	Provisions for credit losses of unused loan commitments									Provisions for credit losses of acceptances and guarantees
	12-month expected credit losses			Lifetime expected credit losses						12-month expected credit losses			Lifetime expected credit losses
(In millions of Korean won)				Non- impaired			Impaired						Non- impaired			Impaired
Beginning		81,709			78,119			—			33,190			14,838			14,328
Transfer between stages:
Transfer to 12-month expected credit losses		24,978			(24,976	)		(2	)		3,958			(203	)		(3,755	)
Transfer to lifetime expected credit losses		(14,468	)		14,587			(119	)		(3,973	)		3,982			(9	)
Impairment		(131	)		(355	)		486			(10	)		(85	)		95
Provision (reversal) for credit losses		1,046			(14,198	)		(365	)		(7,482	)		64,178			711
Others (exchange differences, etc.)		1,049			405			—			1,758			(540	)		167
Ending		94,183			53,582			—			27,441			82,170			11,537

137

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

22.3 Changes in provisions for restoration costs for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Beginning		128,407			131,674
Provision		6,336			5,879
Reversal		1,261			(1,016	)
Used		(12,411	)		(12,541	)
Unwinding of discount		2,363			1,369
Effect of changes in discount rate		9,521			3,042
Ending		135,477			128,407

Provisions for restoration costs are the present value of estimated costs to be incurred for the restoration of the leased properties. The expenditure of the restoration cost will be incurred at the end of each lease contract, and the lease period is used to reasonably estimate the time of expenditure. Also, the average restoration expense based on actual three-year historical data and three-year historical average inflation rate are used to estimate the present value of estimated costs.

22.4 Changes in other provisions for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Membership rewards program			Dormant accounts			Litigations			Financial guarantee contracts			Others			Total
Beginning		43			3,062			10,119			5,285			11,038			29,547
Provision (reversal)		84			2,666			33,503			(2,330	)		26,595			60,518
Used and others		(81	)		(2,934	)		(2,392	)		—			(1,939	)		(7,346	)
Ending		46			2,794			41,230			2,955			35,694			82,719
	2021
(In millions of Korean won)	Membership rewards program			Dormant accounts			Litigations			Financial guarantee contracts			Others			Total
Beginning		35			3,008			9,969			6,347			14,797			34,156
Provision (reversal)		77			3,429			24			(896	)		(4,289	)		(1,655	)
Used and others		(69	)		(3,375	)		126			(166	)		530			(2,954	)
Ending		43			3,062			10,119			5,285			11,038			29,547

138

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

23. Net Defined Benefit Liabilities (Assets)

23.1 Defined Benefit Plan

The Group operates defined benefit plans which have the following characteristics:

• The Group has the obligation to pay the agreed benefits to all its current and former employees.

• The Group assumes actuarial risk (that benefits will cost more than expected) and investment risk.

The net defined benefit liabilities (assets) recognized in the consolidated statements of financial position are calculated in accordance with actuarial valuation method using assumptions based on market data and historical data such as discount rate, future salary increase rate, and mortality. Actuarial assumptions may differ from actual results, due to changes in the market conditions, economic trends, and mortality trends.

23.2 Changes in net defined benefit liabilities (assets) for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Present value of defined benefit obligation			Fair value of plan assets			Net defined benefit liabilities(assets)
Beginning		1,847,905			(1,692,621	)		155,284
Current service cost		163,587			—			163,587
Interest expense (income)		46,854			(43,392	)		3,462
Remeasurements:
Actuarial gains and losses by experience adjustments		9,041			—			9,041
Actuarial gains and losses by changes in demographic assumptions		41,988			—			41,988
Actuarial gains and losses by changes in financial assumptions		(352,447	)		—			(352,447	)
Return on plan assets (excluding amounts included in interest income)		—			54,808			54,808
Contributions by the Group		—			(360,000	)		(360,000	)
Payments from plans (benefit payments)		(196,543	)		196,543			—
Payments from the Group		(9,330	)		—			(9,330	)
Transfer in		5,150			(4,516	)		634
Transfer out		(7,052	)		7,052			—
Effect of exchange differences		1,467			—			1,467
Ending		1,550,620			(1,842,126	)		(291,506	)

139

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

23.2 Changes in net defined benefit liabilities (assets) for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021
(In millions of Korean won)	Present value of defined benefit obligation			Fair value of plan assets			Net defined benefit liabilities
Beginning		1,748,770			(1,583,368	)		165,402
Current service cost		155,506			—			155,506
Interest expense (income)		34,075			(31,069	)		3,006
Remeasurements:
Actuarial gains and losses by experience adjustments		5,180			—			5,180
Actuarial gains and losses by changes in demographic assumptions		7,330			—			7,330
Actuarial gains and losses by changes in financial assumptions		81,928			—			81,928
Return on plan assets (excluding amounts included in interest income)		—			5,363			5,363
Contributions by the Group		—			(264,600	)		(264,600	)
Payments from plans (benefit payments)		(178,937	)		178,937			—
Payments from the Group		(6,578	)		—			(6,578	)
Transfer in		3,602			(3,067	)		535
Transfer out		(5,183	)		5,183			—
Effect of exchange differences		2,212			—			2,212
Ending		1,847,905			(1,692,621	)		155,284

23.3 Details of net defined benefit liabilities (assets) as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Present value of defined benefit obligation		1,550,620			1,847,905
Fair value of plan assets		(1,842,126	)		(1,692,621	)
Net defined benefit liabilities (assets)		(291,506	)		155,284

23.4 Details of remeasurements of net defined benefit liabilities(asset) recognized in other comprehensive income (loss) for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Remeasurements:
Actuarial losses arising from experience adjustments		(9,041	)		(5,180	)
Actuarial losses arising from changes in demographic assumptions		(41,988	)		(7,330	)
Actuarial losses arising from changes in financial assumptions		352,447			(81,928	)
Return on plan assets (excluding amounts included in interest income)		(54,808	)		(5,363	)
Income tax effect		(67,749	)		28,201
Effect of exchange differences		(345	)		(15	)
Remeasurements after income tax expense		178,516			(71,615	)

140

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

23.5 Details of fair value of plan assets as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Assets quoted in an active market		Assets not quoted in an active market		Total
Time deposits		—		1,388,054		1,388,054
Others		—		454,072		454,072
		—		1,842,126		1,842,126

(In millions of Korean won)	December 31, 2021
	Assets quoted in an active market		Assets not quoted in an active market		Total
Time deposits		—		1,374,281		1,374,281
Others		—		318,340		318,340
		—		1,692,621		1,692,621

23.6 Details of significant actuarial assumptions used as of December 31, 2022 and 2021, are as follows:

	December 31, 2022	December 31, 2021
Discount rate (%)	5.20	2.60
Salary increase rate (%)	0.00~5.25	0.00~5.04
Turnover rate (%)	2.30~38.60	1.00~20.00

Mortality assumptions are based on the experience-based mortality table issued by Korea Insurance Development Institute in 2019.

23.7 Results of sensitivity analysis of significant actuarial assumptions as of December 31, 2022, are as follows:

		Effect on defined benefit obligation
	Changes in assumptions	Increase in assumptions	Decrease in assumptions
Discount rate	0.5%p	3.02% decrease	3.21% increase
Salary increase rate	0.5%p	3.19% increase	3.03% decrease
Turnover rate	0.5%p	0.24% increase	0.26% decrease

The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. The sensitivity of the defined benefit obligation to changes in significant actuarial assumptions is calculated using the same projected unit credit method used in calculating the defined benefit obligation recognized in the consolidated statement of financial position.

141

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

23.8 Expected maturity analysis of undiscounted pension benefit payments as of December 31, 2022, are as follows:

(In millions of Korean won)	Up to 1 year		1~2 years		2~5 years		5~10 years		Over 10 years		Total
Pension benefits		162,720		215,188		650,944		1,151,476		6,256,181		8,436,509

The weighted average duration of the defined benefit obligation is 7.34 and 9.41 years as of December 31, 2022 and 2021, respectively.

23.9 Reasonable estimation of expected contribution to plan assets for the next annual reporting period after December 31, 2022 is W 360,000 million.

24. Other Liabilities

Details of other liabilities as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Other financial liabilities
Other payables		3,837,087		2,756,641
Prepaid card and debit card payables		1,840		1,237
Accrued expenses		3,404,404		2,178,928
Financial guarantee contracts liabilities		44,440		50,390
Deposits for letter of guarantees and others		1,116,184		387,082
Domestic exchange settlement credits		1,734,905		5,121,689
Foreign exchange settlement credits		250,138		169,264
Due to trust accounts		5,808,446		7,033,849
Liabilities incurred from agency relationships		513,621		739,276
Account for agency business		241,910		423,798
Lease liabilities		372,002		375,472
Others		51,359		477,572
		17,376,336		19,715,198
Other non-financial liabilities
Other payables		1,053,097		660,409
Unearned revenue		106,756		70,111
Accrued expenses		542,818		489,686
Withholding taxes		153,537		118,308
Others		59,339		35,859
		1,915,547		1,374,373
		19,291,883		21,089,571

142

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

25. Equity

25.1 Capital Stock

Details of capital stock as of December 31, 2022 and 2021, are as follows:

	Ordinary shares
(In millions of Korean won and in number of shares)	December 31, 2022		December 31, 2021
Type of share		Ordinary share		Ordinary share
Number of authorized shares		1,000,000,000		1,000,000,000
Par value per share (In Korean won)		5,000		5,000
Number of issued shares		404,379,116		404,379,116
Capital stock		2,021,896		2,021,896

25.2 Hybrid Security

Details of hybrid security classified as equity as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Issuance date		Maturity			Interest rate (%)		December 31, 2022		December 31, 2021
Amortized Conditional Capital Securities		July 2, 2019		Permanent	1		4.35		574,523		574,523
		June 23, 2022		Permanent	2		4.89		299,327		—

¹ Above hybrid securities are early redeemable by the Group after 5 years from the issuance date and each interest payment date thereafter.

² Early redeemable by the Group only when prior approval from the head of the Financial Supervisory Service is obtained after 5 years from the issuance date.

25.3 Capital Surplus

Details of capital surplus as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Paid-in capital in excess of par value		4,604,417			4,604,417
Gains on business combination		397,669			397,669
Revaluation reserve		177,229			177,229
Other capital surplus		(153,980	)		(153,980	)
		5,025,335			5,025,335

143

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

25.4 Accumulated Other Comprehensive Income

Details of accumulated other comprehensive income as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Remeasurements of net defined benefit liabilities		(113,922	)		(292,232	)
Currency translation differences		201,288			68,224
Gains (losses) on debt securities measured at fair value through other comprehensive income		(652,186	)		(186,463	)
Gains on equity securities measured at fair value through other comprehensive income		641,536			1,838,548
Share of other comprehensive loss of associates		(2,590	)		(2,526	)
Losses on cash flow hedging instruments		33,921			(89	)
Gains (losses) on hedging instruments of net investments in foreign operations		(95,296	)		(30,306	)
		12,751			1,395,156

25.5 Retained Earnings

25.5.1 Details of retained earnings as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Legal reserves		2,044,631		2,043,729
Regulatory reserve for credit losses		2,915,162		2,534,401
Voluntary reserves		17,739,062		16,742,471
Unappropriated retained earnings		3,135,337		2,340,120
		25,834,192		23,660,721

With respect to the allocation of net profit earned in a fiscal term, the Bank must set aside in its legal reserve an amount equal to at least 10% of its profit after tax as reported in the financial statements, each time it pays dividends on its net profits earned until its legal reserve reaches the aggregate amount of its paid-in capital in accordance with Article 40 of the Banking Act. This reserve is not available for the payment of cash dividends, but may be transferred to capital stock, or used to reduce accumulated deficit. The Bank is reserving other reserves (legal reserves) in accordance with local laws and regulations of overseas branches.

25.5.2 Regulatory reserve for credit losses

Measurement and disclosure of regulatory reserve for credit losses are required in accordance with Articles 29.1 through 29.2 of Regulations on Supervision of Banking Business.

25.5.2.1 Details of regulatory reserve for credit losses as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Regulatory reserve for credit losses attributable to:
Shareholder of the Parent Company		3,018,015		2,915,162
Non-controlling interests		79,118		60,265
		3,097,133		2,975,427

144

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

25.5.2.2 Regulatory reserve for credit losses estimated to be appropriated and adjusted profit after provision of regulatory reserve for credit losses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Regulatory reserve for credit losses estimated to be appropriated		102,853		380,761
Adjusted profit after provision of regulatory reserve for credit losses *		2,893,162		2,210,003

* Adjusted profit after provision of regulatory reserve for credit losses is not based on Korean IFRS. It is calculated by reflecting provision of regulatory reserve for credit losses before tax to the net profit attributable to shareholder of the Parent Company.

26. Net Interest Income

Details of interest income, interest expense, and net interest income for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Interest income
Securities measured at fair value through profit or loss		282,403		158,057
Loans measured at fair value through profit or loss		7,442		715
Securities measured at fair value through other comprehensive income		669,668		454,561
Loans measured at fair value through other comprehensive income		6,023		3,003
Due from financial institutions measured at amortized cost		79,929		25,466
Securities measured at amortized cost		637,504		307,447
Loans measured at amortized cost		13,351,316		9,487,206
Others		324,416		237,906
		15,358,701		10,674,361
Interest expense
Deposits		4,455,350		2,179,196
Borrowings		674,082		251,523
Debentures		756,478		453,761
Others		181,770		61,405
		6,067,680		2,945,885
Net interest income		9,291,021		7,728,476

Interest income recognized on impaired loans is W 16,853 million and W 17,926 million for the years ended December 31, 2022 and 2021, respectively.

145

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

27. Net Fee and Commission Income

Details of fee and commission income, fee and commission expense, and net fee and commission income for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Fee and commission income
Banking activity fees		190,874		188,079
Lending activity fees		65,368		73,500
Credit card related fees		1,438		2,106
Debit card related fees		591		568
Agent activity fees		329,117		286,286
Trust and other fiduciary fees		201,238		307,632
Acceptances and guarantees fees		60,890		46,597
Foreign currency related fees		164,980		128,945
Securities agency fees		105,471		146,989
Other business account commission on consignment		36,211		39,178
Others		373,980		367,064
		1,530,158		1,586,944
Fee and commission expense
Trading activity related fees *		16,308		13,092
Lending activity fees		44,833		47,861
Credit card related fees		39,385		31,298
Outsourcing related fees		106,042		104,214
Foreign currency related fees		25,173		17,101
Management fees of written-off loans		12,842		16,392
Contributions to external institutions		27,997		23,574
Others		160,970		145,531
		433,550		399,063
Net fee and commission income		1,096,608		1,187,881

* Fees from financial instruments at fair value through profit or loss

146

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

28. Net Gains or Losses on Financial Instruments at Fair Value through Profit or Loss

Net gains or losses on financial instruments at fair value through profit or loss include dividend income, gains or losses arising from changes in fair value, and gains or losses arising from sales and redemptions.

Details of net gains or losses on financial instruments at fair value through profit or loss for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Gains on financial instruments at fair value through profit or loss
Financial assets at fair value through profit or loss:
Debt securities		472,217		387,421
Equity securities		23,347		50,392
		495,564		437,813
Derivatives held for trading:
Interest rate		7,520,856		3,506,695
Currency		13,709,057		7,102,646
Stock or stock index		15,285		675
Credit		39,646		—
Others		1,672		1,433
		21,286,516		10,611,449
Financial liabilities at fair value through profit or loss		2,951		1,345
Other financial instruments		252		6,754
		21,785,283		11,057,361
Losses on financial instruments at fair value through profit or loss
Financial assets at fair value through profit or loss:
Debt securities		944,163		276,727
Equity securities		34,431		30,068
		978,594		306,795
Derivatives held for trading:
Interest rate		6,652,262		3,415,836
Currency		13,892,134		6,982,145
Stock or stock index		10,751		16
Credit		36,380		70
Others		3,547		2,212
		20,595,074		10,400,279
Financial liabilities at fair value through profit or loss		829		613
Other financial instruments		205		6,840
		21,574,702		10,714,527
Net gains on financial instruments at fair value through profit or loss		210,581		342,834

147

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

29. Net Other Operating Income and Expenses

Details of other operating income and expenses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Other operating income
Gains on financial assets at fair value through other comprehensive income:
Gains on redemption of securities measured at fair value through other comprehensive income		20			2
Gains on disposal of securities measured at fair value through other comprehensive income		19,977			98,920
Gains on financial assets at amortized cost:
Gains on sale of loans measured at amortized cost		28,734			42,020
Gains on redemption of securities measured at amortized cost		—			126
Gains on foreign exchange transactions		9,859,577			2,683,228
Dividend income		9,934			17,926
Others		843,662			376,107
		10,761,904			3,218,329
Other operating expenses
Losses on financial assets at fair value through other comprehensive income:
Losses on redemption of securities measured at fair value through other comprehensive income		2,757			2,172
Losses on disposal of securities measured at fair value through other comprehensive income		30,840			97,993
Losses on financial assets at amortized cost:
Losses on sale of loans measured at amortized cost		51,214			3,560
Losses on redemption of securities measured at amortized cost		—			6
Losses on disposal of securities measured at amortized cost		—			2
Losses on foreign exchange transactions		9,784,228			2,676,760
Deposit insurance fee		502,631			466,999
Credit guarantee fund fee		283,912			263,297
Others		1,050,422			527,279
		11,706,004			4,038,068
Net other operating expenses		(944,100	)		(819,739	)

148

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

30. General and Administrative Expenses

30.1 Details of general and administrative expenses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Expenses related to employee
Employee benefits - salaries		1,778,373		1,705,537
Employee benefits - welfare		707,690		655,731
Post-employment benefits - defined benefit plans		167,049		158,512
Post-employment benefits - defined contribution plans		15,491		12,111
Termination benefits		272,615		266,541
Share-based payments		15,169		27,995
		2,956,387		2,826,427
Depreciation and amortization		546,505		537,628
Other general and administrative expenses
Rental expense		72,564		70,078
Tax and dues		169,351		130,523
Communication		41,251		37,246
Electricity and utilities		28,958		30,586
Publication		6,184		7,078
Repairs and maintenance		38,613		36,806
Vehicle		14,032		11,903
Travel		9,134		3,738
Training		22,523		23,667
Service fees		187,534		175,579
Supplies		21,930		21,355
Electronic data processing expenses		220,814		175,307
Others		362,171		314,810
		1,195,059		1,038,676
		4,697,951		4,402,731

149

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

30.2 Share-based Payments

30.2.1 Stock grants

The Group changed the scheme of share-based payments awarded to executives and employees from stock options to stock grants in November 2007. The stock grants award program is an incentive plan that sets, on grant date, the maximum number of shares that can be awarded. Actual shares to be granted is determined in accordance with achievement of pre-set performance targets over the vesting period.

30.2.1.1 Details of stock grants linked to long-term performance as of December 31, 2022, are as follows:

(In number of shares)
Stock grants	Grant date	Number of granted shares 1		Vesting conditions 2
Series 80	Mar. 1, 2020		7,982	Services fulfillment, Total Shareholder Return (TSR) 30~50%, and Company and work performance 50~70%
Series 81	Jan. 1, 2021		139,783	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 83	Apr. 1, 2021		15,278	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 85	Jan. 1, 2022		292,777	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%, Services fulfillment, TSR 30%, and EPS and Asset Quality 70%
Series 86	Feb. 1, 2022		1,525	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 87	Mar. 1, 2022		2,599	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 88	Mar. 14, 2022		5,884	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 89	May. 26, 2022		2,363	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 90	Jul. 18, 2022		4,131	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 91	Aug. 24, 2022		7,277	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Deferred grant in 2016			2,426	Satisfied
Deferred grant in 2017			4,582	Satisfied
Deferred grant in 2018			2,287	Satisfied
Deferred grant in 2019			32,756	Satisfied
Deferred grant in 2020			53,502	Satisfied
Deferred grant in 2021			156,939	Satisfied
			732,091

¹ Granted shares represent the total number of shares initially granted to executives and employees who have residual shares as of December 31, 2022 (Deferred grants are residual shares vested as of December 31, 2022).

² Executives and employees were given the right of choice about the timing of the deferred payment (after the date of retirement), payment ratio, and payment period. Accordingly, a certain percentage of the granted shares is deferred for up to five years after the date of retirement after the deferred grant has been confirmed.

150

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

30.2.1.2 Details of stock grants linked to short-term performance as of December 31, 2022, are as follows:

(In number of shares)
Stock grants *	Grant date		Estimated number of vested shares		Vesting conditions
Stock granted in 2015		Jan. 1, 2015		1,292		Satisfied
Stock granted in 2016		Jan. 1, 2016		4,875		Satisfied
Stock granted in 2017		Jan. 1, 2017		1,998		Satisfied
Stock granted in 2018		Jan. 1, 2018		2,109		Satisfied
Stock granted in 2019		Jan. 1, 2019		41,737		Satisfied
Stock granted in 2010		Jan. 1, 2020		89,888		Satisfied
Stock granted in 2021		Jan. 1, 2021		130,331		Satisfied
Stock granted in 2022		Jan. 1, 2022		134,402		Proportion to service period

* Executives and employees were given the right of choice about the timing of the deferred payment (after the date of retirement), payment ratio, and payment period. Accordingly, a certain percentage of the granted shares is deferred for up to five years after the date of retirement after the deferred grant has been confirmed.

30.2.1.3 Stock grants are measured at fair value using the MonteCarlo simulation model and assumptions used in measuring the fair value as of December 31, 2022, are as follows:

(In Korean won)	Expected exercise period(years)		Risk-free rate (%)			Fair value (market performance condition)		Fair value (non- market performance condition)
Series 80		0.00~3.00		3.78	%		43,157~50,973		43,157~50,973
Series 81		0.00~3.00		3.78	%		35,905~41,289		43,157~50,973
Series 83		0.25~4.00		3.78	%		38,660~43,583		41,548~46,663
Series 85		1.00~4.00		3.78	%		33,668~37,813		41,548~46,663
Series 86		1.08~5.00		3.78	%		35,486~39,839		39,958~44,859
Series 87		1.16~5.00		3.78	%		38,957~46,013		43,157~50,973
Series 88		1.20~5.00		3.78	%		37,288~41,862		39,958~44,859
Series 89		1.40~5.00		3.78	%		40,943~48,358		43,157~50,973
Series 90		1.55~5.00		3.78	%		39,554~44,405		39,958~44,859
Series 91		1.65~5.00		3.78	%		37,840~42,481		39,958~44,859
Grant deferred in 2016		0.00~1.00		3.78	%		—		46,663~50,973
Grant deferred in 2017		0.00~1.00		3.78	%		—		46,663~50,973
Grant deferred in 2018		0.00~1.00		3.78	%		—		46,663~50,973
Grant deferred in 2019		—		3.78	%		—		50,973
Grant deferred in 2020		0.00~1.00		3.78	%		—		46,663~50,973
Grant deferred in 2021		0.00~2.00		3.78	%		—		44,859~50,973
Stock granted in 2015		0.00~1.00		3.78	%		—		46,663~50,973
Stock granted in 2016		0.00~2.00		3.78	%		—		44,859~50,973
Stock granted in 2017		0.00~1.00		3.78	%		—		46,663~50,973
Stock granted in 2018		0.00~1.00		3.78	%		—		46,663~50,973
Stock granted in 2019		—		3.78	%		—		50,973
Stock granted in 2020		0.00~1.00		3.78	%		—		46,663~50,973
Stock granted in 2021		0.00~2.00		3.78	%		—		44,859~50,973
Stock granted in 2022		1.00~5.00		3.78	%		—		39,958~46,663

The Group uses the volatility of the stock price over the previous year as the expected volatility, and uses the arithmetic mean of the price-dividend ratio of one year before, two years before, and three years before the base year as the dividend yield and uses one-year risk-free rate of Korea Treasury Bond in order to measure the fair value.

151

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

30.2.1.4 The accrued expenses for share-based payments related to stock grants are W 46,740 million and W 53,577 million as of December 31, 2022 and 2021, respectively, and the compensation costs amounting to W 15,169 million and W 27,995 million were recognized for the years ended December 31, 2022 and 2021, respectively.

30.2.2 Mileage stock

30.2.2.1 Details of mileage stock as of December 31, 2022, are as follows:

(In number of shares)
Grant date		Number of granted shares 1		Expected exercise period (years) 2		Remaining shares
Stock granted in 2019
	Nov. 1, 2019		119		0.00		48
	Nov. 8, 2019		14		0.00		6
	Dec. 6, 2019		84		0.00		50
	Dec. 5, 2019		56		0.00		41
	Dec. 31, 2019		87		0.00		43
Stock granted in 2020
	Jan. 18, 2020		28,645		0.00~0.05		15,541
	May 12, 2020		46		0.00~0.36		43
	Jun. 30, 2020		206		0.00~0.50		147
	Aug. 26, 2020		40		0.00~0.65		27
	Oct. 29, 2020		160		0.00~0.83		107
	Nov. 6, 2020		45		0.00~0.85		37
	Nov. 30, 2020		35		0.00~0.92		34
	Dec. 2, 2020		57		0.00~0.92		44
	Dec. 4, 2020		154		0.00~0.93		110
	Dec. 30, 2020		88		0.00~1.00		64
Stock granted in 2021
	Jan. 15, 2021		28,156		0.00~1.04		18,712
	Apr. 5, 2021		89		0.00~1.26		53
	Jul. 1, 2021		54		0.00~1.50		54
	Jul. 2, 2021		11		0.00~1.50		11
	Jul. 27, 2021		70		0.00~1.57		63
	Nov. 1, 2021		71		0.00~1.84		71
	Nov. 16, 2021		53		0.00~1.88		48
	Dec. 6, 2021		87		0.00~1.93		87
	Dec. 3, 2021		91		0.00~1.92		89
	Dec. 30, 2021		76		0.00~2.00		76

152

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

30.2.2.1 Details of mileage stock as of December 31, 2022, are as follows: (cont’d)

(In number of shares)
Grant date	Number of granted shares 1		Expected exercise period (years) 2		Remaining shares
Stock granted in 2022
Jan. 14, 2022		20,909		0.00~2.04		19,864
Apr. 4, 2022		65		0.00~2.26		65
Apr. 19, 2022		33		0.00~2.30		33
Jul. 1, 2022		62		0.00~2.50		62
Aug. 3, 2022		62		0.00~2.59		62
Aug. 9, 2022		80		0.00~2.61		76
Oct. 19, 2022		55		0.00~2.80		55
Nov. 1, 2022		177		0.00~2.84		177
Dec. 1, 2022		49		0.00~2.92		49
Dec. 12, 2022		114		0.00~2.95		114
Dec. 6, 2022		88		0.00~2.93		88
Dec. 2, 2022		42		0.00~2.92		42
Dec. 15, 2022		42		0.00~2.96		42
Dec. 30, 2022		114		0.00~3.00		114
		80,486				56,449

¹ Mileage stock is exercisable for two years after one year from the grant date at the closing price of the end of the previous month. However, mileage stock can be exercised at the closing price of the end of the previous month on the date of occurrence of retirement or transfer despite a one-year grace period.

² Assessed based on the stock price as of December 31, 2022. These shares are vested immediately at grant date.

30.2.2.2 The accrued expenses for share-based payments related to mileage stock are W 2,738 million and W 3,465 million as of December 31, 2022 and 2021, respectively. The compensation costs amounting to W 870 million and W 2,116 million were recognized as expenses for the years ended December 31, 2022 and 2021, respectively.

153

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

31. Net Other Non-Operating Income and Expenses

Details of other non-operating income and expenses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Other non-operating income
Gains on disposal of property and equipment and assets held for sale		50,112			11,478
Rental income		22,561			19,238
Others		24,396			29,443
		97,069			60,159
Other non-operating expenses
Losses on disposal of property and equipment and assets held for sale		8,186			10,522
Donation		62,712			75,909
Restoration costs		2,336			2,743
Others		61,700			50,590
		134,934			139,764
Net other non-operating income (expenses)		(37,865	)		(79,605	)

154

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

32. Income Tax Expense

32.1 Details of income tax expense for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Income tax payable
Current income tax expense		1,336,580			895,895
Adjustments of income tax of prior years recognized in current tax		(120,740	)		5,331
		1,215,840			901,226
Changes in deferred income tax assets and liabilities		(579,105	)		263,181
Income tax expense of overseas branches		33,244			20,920
Income tax recognized directly in equity:
Net gains or losses on equity instruments at fair value through other comprehensive income		466,078			(419,220	)
Net gains or losses on debt instruments at fair value through other comprehensive income		164,231			106,811
Currency translation differences		(7,412	)		(9,166	)
Remeasurements of net defined benefit liabilities		(67,749	)		28,201
Gains or losses on hedging instruments of net investments in foreign operations		22,863			20,637
Gains or losses on cash flow hedging instruments		(12,264	)		(3,787	)
Share of other comprehensive income or loss of associates		(15	)		(63	)
		565,732			(276,587	)
Reclassification from AOCI to retained earnings due to sale of equity securities measured at fair value through other comprehensive income		(92,181	)		87,814
Consolidated tax return effect		(62,854	)		(45,308	)
Others		807			2,269
Income tax expense		1,081,483			953,515

155

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

32.2 Analysis of the relationship between net profit before income tax expense and income tax expense for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Profit before income tax expense		3,809,790			3,491,544
Income tax at the applicable tax rate *		1,037,330			949,814
Non-taxable income		(10,300	)		(14,491	)
Non-deductible expenses		10,040			11,539
Tax credit and tax exemption		(1,418	)		—
Temporary difference for which no deferred tax is recognized		95,438			21,967
Changes in recognition and measurement of deferred tax		98,854			—
Income tax refund for tax of prior years		(135,121	)		(17,187	)
Income tax expense of overseas branches		33,244			20,920
Tax effect of investments in subsidiaries		9,961			20,942
Foreign subsidiary tax rate difference effect		28,206			(842	)
Effect of tax rate change		(5,670	)		—
Consolidated tax return effect		(62,854	)		(45,308	)
Others		(16,227	)		6,161
Income tax expense		1,081,483			953,515
Income tax expense/Profit before income tax (%)		28.39			27.31

* Applicable income tax rate for W 200 million and below is 11%, for over W 200 million to W 20 billion is 22%, for over W 20 billion to W 300 billion is 24.2% and for over W 300 billion is 27.5% for the years ended December 31, 2022 and 2021.

32.3 Details of current tax liabilities (income tax payables) and current tax assets (income tax refund receivables) before offsetting as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Tax payables after offsetting 1, 2		873,805			480,218
Adjustment on consolidated tax payable and others 3		(62,854	)		(45,308	)
Consolidated tax return accounts payables 4		(747,922	)		(377,629	)
Current tax payable		63,029			57,281

¹ Current tax assets of W 172,757 million and W 44,942 million due to uncertain tax position and current tax assets of W 19,282 million and W 16,372 million for overseas branches were excluded, which does not qualify for offsetting as of December 31, 2022 and 2021, respectively.

² Includes income tax payable of W 63,029 million and W 57,281 million under current tax liabilities, which are not to be offset against any income tax refund receivables, such as those of overseas branches as of December 31, 2022 and 2021, respectively.

³ Tax expense reduced due to the adoption of consolidated tax return was recognized as tax benefit.

⁴ The amount of income tax payable is reclassified as accounts payable, not to the tax authority, but to KB Financial Group Inc. due to the adoption of consolidated tax return.

156

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

33. Dividends

The annual dividends to the shareholder of the Bank for the year ended December 31, 2022, amounting to W 1,346,582 million (W 3,330 per share) is to be proposed at the general shareholder’s meeting scheduled for March 23, 2023. The Group’s consolidated financial statements as of and for the year ended December 31, 2022, do not reflect this dividend payable.

34. Accumulated Other Comprehensive Income (Loss)

Changes in accumulated other comprehensive income (loss) for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning			Changes (excluding reclassifica- tion)			Reclassification to profit or loss		Tax effect			Transfer to retained earnings			Ending
Remeasurements of net defined benefit liabilities		(292,232	)		246,059			—		(67,749	)		—			(113,922	)
Currency translation differences		68,224			140,476			—		(7,412	)		—			201,288
Gains on (losses) debt securities measured at fair value through other comprehensive income		(186,463	)		(933,967	)		304,013		164,231			—			(652,186	)
Gains on equity securities measured at fair value through other comprehensive income		1,838,548			(1,327,887	)		—		466,078			(335,203	)		641,536
Share of other comprehensive loss of associates		(2,526	)		(49	)		—		(15	)		—			(2,590	)
Losses on cash flow hedging instruments		(89	)		43,886			2,388		(12,264	)		—			33,921
Gains (losses) on hedging instruments of net investments in foreign operations		(30,306	)		(87,853	)		—		22,863			—			(95,296	)
		1,395,156			(1,919,335	)		306,401		565,732			(335,203	)		12,751

	2021
(In millions of Korean won)	Beginning			Changes (excluding reclassifica- tion)			Reclassification to profit or loss		Tax effect			Transfer to retained earnings		Ending
Remeasurements of net defined benefit liabilities		(220,178	)		(100,255	)		—		28,201			—		(292,232	)
Currency translation differences		(118,526	)		193,922			1,994		(9,166	)		—		68,224
Gains on (losses) debt securities measured at fair value through other comprehensive income		88,478			(385,466	)		3,714		106,811			—		(186,463	)
Gains on equity securities measured at fair value through other comprehensive income		733,332			1,205,112			—		(419,220	)		319,324		1,838,548
Share of other comprehensive loss of associates		(2,691	)		228			—		(63	)		—		(2,526	)
Losses on cash flow hedging instruments		(10,073	)		11,468			2,303		(3,787	)		—		(89	)
Gains (losses) on hedging instruments of net investments in foreign operations		24,103			(80,241	)		5,195		20,637			—		(30,306	)
		494,445			844,768			13,206		(276,587	)		319,324		1,395,156

157

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

35. Trust Accounts

35.1 Financial information of the trust accounts the Group manages, as of and for the years ended December 31, 2022 and 2021, are as follows:

	Total assets				Operating revenues
(In millions of Korean won)	December 31, 2022		December 31, 2021		2022		2021
Consolidated		4,192,712		4,372,406		122,144		92,012
Unconsolidated (non-guaranteed)		76,695,803		68,491,476		1,996,658		2,002,166
		80,888,515		72,863,882		2,118,802		2,094,178

* Financial information of the trust accounts has been prepared in accordance with the Statement of Korea Accounting Standard No.5004, Trust Accounts, and enforcement regulations of the Financial Investment Services under the Financial Investment Services and Capital Markets Act.

35.2 Significant receivables and payables related to the Group’s trust accounts as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Trust segment	Receivables
	Accrued trust fees		55,990		30,288
	Other accrued income		27,376		23,848
			83,366		54,136
	Payables
	Due to trust accounts		1,580,076		1,019,236
	Accrued interest on due to trust accounts		7,294		3,949
	Deposits		686,394		485,126
	Accrued interest on deposits		5,641		1,735
			2,279,405		1,510,046
Custody segment	Receivables
	Accrued trust fees		8,461		7,689
	Payables
	Due to trust accounts		4,228,370		6,014,613
	Accrued interest on due to trust accounts		10,820		3,599
			4,239,190		6,018,212

158

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

35.3 Significant revenues and expenses related to the Group’s trust accounts for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		2022		2021
Trust segment	Revenues
	Fees and commissions from trust accounts		163,184		270,977
	Management fees and commissions from retirement pension		30,797		28,387
	Commissions from early termination in trust accounts		13		36
			193,994		299,400
	Expenses
	Interest expenses on due to trust accounts		31,355		11,150
	Interest expenses on deposits		19,655		4,868
			51,010		16,018
Custody segment	Revenues
	Fees and commissions from trust accounts		38,054		36,656
	Expenses
	Interest expenses on due to trust accounts		83,797		20,470

159

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

36. Statement of Cash Flows

36.1 Details of cash and cash equivalents as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Cash		2,437,356			2,494,543
Checks issued by other banks		123,163			150,047
Due from the Bank of Korea		15,963,883			16,038,651
Due from other financial institutions		6,603,392			6,481,750
		25,127,794			25,164,991
Deduction:
Restricted due from financial institutions *		(1,461,327	)		(1,741,419	)
Due from financial institutions with original maturities over three months		(311,946	)		(302,075	)
		(1,773,273	)		(2,043,494	)
		23,354,521			23,121,497

* Items that meet the definition of cash are excluded in accordance with Korean IFRS No.1007 Statement of Cash Flows. Detailed information on the effects of this change in accounting policy is described in Note 2.1 Application of Korean IFRS.

Items that meet the definition of cash in restricted due from financial institutions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		Financial institutions	December 31, 2022		December 31, 2021
Due from financial institutions in Korean won	Due from the Bank of Korea	The Bank of Korea		15,169,703		15,117,033
Due from financial institutions in foreign currencies	Due from banks in foreign currencies	The Bank of Korea		794,180		721,618
		Bank Indonesia and others		421,718		285,655
				16,385,601		16,124,306

36.2 Significant non-cash transactions for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Write-offs of loans		846,312			484,243
Changes in accumulated other comprehensive income from valuation of debt securities measured at fair value through other comprehensive income		(465,723	)		(274,941	)
Changes in accumulated other comprehensive income from valuation of equity securities measured at fair value through other comprehensive income		(1,197,012	)		1,105,217
Changes in accumulated other comprehensive income from valuation of investments in associates		(64	)		165
Changes in financial investments due to debt-for-equity swap		—			327

160

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

36.3 Cash inflows and outflows from income tax, interest, and dividends for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Activities		2022		2021
Income tax paid		Operating		908,394		1,043,878
Interest received		Operating		15,033,525		10,843,378
Interest paid		Operating		4,986,483		3,169,577
Dividends received		Operating		256,335		170,449
Dividends paid		Financing		1,031,167		917,941
Interest (dividends) paid on hybrid securities		Financing		34,399		24,144

36.4 Changes in liabilities arising from financing activities for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Derivatives held for hedging *			Borrowings			Debentures			Due to trust accounts			Lease liabilities			Deposits for letter of guarantees		Other payables			Total
Beginning		(88,125	)		32,523,161			29,718,734			7,033,849			375,472			387,082		108,115			70,058,288
Cash flow		33,402			11,575,186			(197,529	)		(1,225,402	)		(157,055	)		712,257		184,647			10,925,506
New lease and termination		—			—			—			—			142,433			—		—			142,433
Exchange differences		—			981,112			450,741			—			—			—		—			1,431,853
Changes in fair values		97,791			—			(293,571	)		—			—			—		—			(195,780	)
Changes from business combination		—			—			—			—			—			—		(188,528	)		(188,528	)
Other changes from non-cash transactions		(35,348	)		(6,342	)		109,347			—			11,153			16,845		12,853			108,508
Ending		7,720			45,073,117			29,787,722			5,808,447			372,003			1,116,184		117,087			82,282,280

	2021
(In millions of Korean won)	Derivatives held for hedging *			Borrowings			Debentures			Due to trust accounts			Lease liabilities			Deposits for letter of guarantees			Other payables			Total
Beginning		(142,840	)		26,870,831			26,969,584			7,542,955			380,629			456,536			419,308			62,497,003
Cash flow		5,870			4,743,115			2,415,697			(509,106	)		(162,954	)		(71,326	)		(373,592	)		6,047,704
New lease and termination		—			—			—			—			147,470			—			—			147,470
Exchange differences		—			909,325			370,021			—			—			—			33,516			1,312,862
Changes in fair values		41,762			—			(126,419	)		—			—			—			—			(84,657	)
Changes from business combination		—			—			—			—			—			—			51,377			51,377
Other changes from non-cash transactions		7,083			(110	)		89,851			—			10,327			1,872			(22,494	)		86,529
Ending		(88,125	)		32,523,161			29,718,734			7,033,849			375,472			387,082			108,115			70,058,288

* Derivatives held for hedging purposes are the net amount after offsetting liabilities and assets.

161

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

37. Contingent Liabilities and Commitments

37.1 Details of acceptances and guarantees as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Confirmed acceptances and guarantees
Confirmed acceptances and guarantees in Korean won:
Acceptances and guarantees for KB purchasing loan		167,538		136,914
Performance bond		3,476		3,476
Refund guarantees		9,259		27,811
Others		905,934		786,183
		1,086,207		954,384
Confirmed acceptances and guarantees in foreign currencies:
Acceptances of letter of credit		502,217		523,037
Letter of guarantees		78,414		83,089
Bid bond		19,998		18,874
Performance bond		976,008		855,247
Refund guarantees		1,705,796		874,173
Others		3,570,739		2,518,394
		6,853,172		4,872,814
Financial guarantee contracts:
Acceptances and guarantees for issuance of debenture		5,040		5,040
Acceptances and guarantees for mortgage		94,861		51,053
Overseas debt guarantees		509,157		428,108
International financing guarantees in foreign currencies		181,241		132,114
Other financial guarantees in Korean won		—		50,950
		790,299		667,265
		8,729,678		6,494,463
Unconfirmed acceptances and guarantees
Guarantees of letter of credit		3,042,911		3,551,767
Refund guarantees		1,528,359		833,765
		4,571,270		4,385,532
		13,300,948		10,879,995

162

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

37.2 Credit qualities of acceptances and guarantees as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Total
(In millions of Korean won)			Non-impaired		Impaired
Confirmed acceptances and guarantees *
Grade 1		6,023,922		1,140		—		6,025,062
Grade 2		1,882,080		10,474		—		1,892,554
Grade 3		494,924		18,649		—		513,573
Grade 4		63,689		215,382		442		279,513
Grade 5		—		4,130		14,846		18,976
		8,464,615		249,775		15,288		8,729,678
Unconfirmed acceptances and guarantees *
Grade 1		3,232,326		844		—		3,233,170
Grade 2		1,040,908		36,879		—		1,077,787
Grade 3		4,685		13,308		—		17,993
Grade 4		1,265		236,687		5		237,957
Grade 5		—		199		4,164		4,363
		4,279,184		287,917		4,169		4,571,270
		12,743,799		537,692		19,457		13,300,948

	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Total
(In millions of Korean won)			Non-impaired		Impaired
Confirmed acceptances and guarantees *
Grade 1		4,545,788		838		—		4,546,626
Grade 2		1,594,713		32,567		—		1,627,280
Grade 3		105,691		46,174		—		151,865
Grade 4		7,722		149,785		214		157,721
Grade 5		—		774		10,197		10,971
		6,253,914		230,138		10,411		6,494,463
Unconfirmed acceptances and guarantees *
Grade 1		3,083,636		3,391		—		3,087,027
Grade 2		998,204		39,224		—		1,037,428
Grade 3		12,039		34,797		—		46,836
Grade 4		11,925		195,794		—		207,719
Grade 5		—		138		6,384		6,522
		4,105,804		273,344		6,384		4,385,532
		10,359,718		503,482		16,795		10,879,995

* Applied same criteria as the credit qualities classification of loans.

163

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

37.3 Classifications of acceptances and guarantees by counterparty as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Confirmed guarantees		Unconfirmed guarantees		Total		Proportion (%)
Large companies		7,615,442		3,810,564		11,426,006		85.90
Small and medium-sized companies		718,722		496,709		1,215,431		9.14
Public sector and others		395,514		263,997		659,511		4.96
		8,729,678		4,571,270		13,300,948		100.00

	December 31, 2021
(In millions of Korean won)	Confirmed guarantees		Unconfirmed guarantees		Total		Proportion (%)
Large companies		5,444,961		3,377,150		8,822,111		81.09
Small and medium-sized companies		820,327		657,073		1,477,400		13.58
Public sector and others		229,175		351,309		580,484		5.33
		6,494,463		4,385,532		10,879,995		100.00

37.4 Classifications of acceptances and guarantees by industry as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Confirmed guarantees		Unconfirmed guarantees		Total		Proportion (%)
Financial institutions		547,553		2,012		549,565		4.13
Manufacturing		3,851,832		3,589,948		7,441,780		55.95
Service		751,846		31,465		783,311		5.89
Wholesale and retail		2,181,469		658,875		2,840,344		21.35
Construction		420,937		47,465		468,402		3.52
Public sector		32,635		81,607		114,242		0.86
Others		943,406		159,898		1,103,304		8.30
		8,729,678		4,571,270		13,300,948		100.00

	December 31, 2021
(In millions of Korean won)	Confirmed guarantees		Unconfirmed guarantees		Total		Proportion (%)
Financial institutions		398,801		10,114		408,915		3.76
Manufacturing		2,742,224		2,979,232		5,721,456		52.59
Service		676,440		38,920		715,360		6.58
Wholesale and retail		1,603,085		999,416		2,602,501		23.92
Construction		317,946		38,260		356,206		3.27
Public sector		28,257		99,841		128,098		1.18
Others		727,710		219,749		947,459		8.70
		6,494,463		4,385,532		10,879,995		100.00

164

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

37.5 Details of commitments as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Commitments
Corporate loan commitments		50,603,030		44,763,099
Retail loan commitments		51,216,282		47,048,097
Other commitments in Korean won		1,700,000		1,300,000
Purchase of other securities		4,880,222		4,024,709
		108,399,534		97,135,905
Financial guarantee contracts
Credit line		6,100,082		4,858,585
Purchase of securities		371,200		495,400
		6,471,282		5,353,985
		114,870,816		102,489,890

165

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

37.6 Other Matters (including litigation)

The Group has 38 pending lawsuits as a plaintiff (excluding simple lawsuits related to the collection or management of loans), with aggregate claims amount of W 1,053,503 million, and details of pending lawsuits in which the Group is a defendant as of December 31, 2022, are as follows:

(In number of cases, in millions of Korean won)

Lawsuits	No. of cases		Amount		Description of the lawsuits	Status of the lawsuits
Request for a return of redemption amount		1		53,239	Kookmin Bank invested the assets entrusted by OO Asset Management and OO Investment Trust Management in the Fairfield Sentry Limited, and Fairfield Sentry Limited reinvested the assets in Bernard L. Madoff Investment Securities LLC managed by Bernard Madoff (Bernard L. Madoff Investment Securities LLC is in the liquidation process due to Ponzi scheme fraud-related losses). Bankruptcy trustee of Bernard L. Madoff Investment Securities LLC filed a lawsuit against Kookmin Bank seeking to return the amount of redemptions received by Kookmin Bank through Fairfield Sentry Limited.	Application for incineration by the defendant has been denied, and further proceedings are scheduled. [Related litigation is in progress at the New York Southern District Bankruptcy Court (10-3777) at the written complaint review stage]
Confirm the absence of debt		1		96,200	Galamat-Art LLP is a joint guarantor of the PF loan for the ‘Kazakhstan Almaty City Complex Development Project’ in which Kookmin Bank participated as a lender. OO Bank, the agent bank of the lending group, filed a provisional seizure and a lawsuit on the merits of the guarantee debt to the local court against Galamat-Art LLP. And Galamat-Art LLP filed a counterclaim against the lenders, including Kookmin Bank, to confirm the absence of debt denying the joint guarantee obligation.	The Bank won the case in the first and second trials, and the plaintiff’s appeal (appeal deadline: April 19, 2023) is being monitored.
Expropriation of long-term leasehold rights		1		316,825	The Bank invested assets entrusted by DAOL Asset Management Co., Ltd. in loans that are directly or indirectly collateralized by the building and land leasehold rights (hereinafter referred to as “the real estate in this case”) of Union Station in Washington, D.C., the United States. The Plaintiff, who is the operator of the railway facility, filed this lawsuit against the stakeholders of the real estate in this case, including the Bank, to expropriate the real estate in this case and determine indemnity.	The Bank submitted the response letter and will proceed with the process in the future.
Others		106		267,703	Others (excluding simple lawsuits related to the collection or management of loans)
		109		733,967

166

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

38. Subsidiaries

38.1 Details of subsidiaries as of December 31, 2022, are as follows:

Investor	Investee	Ownership (%)	Location	Industry
Kookmin Bank	Kookmin Bank Cambodia Plc.	100.00	Cambodia	Banking and foreign exchange transaction
Kookmin Bank	Kookmin Bank (China) Ltd.	100.00	China	Banking and foreign exchange transaction
Kookmin Bank	KB Microfinance Myanmar Co., Ltd.	100.00	Myanmar	Microfinance services
Kookmin Bank	KB Bank Myanmar Co., Ltd.	100.00	Myanmar	Banking and foreign exchange transaction
Kookmin Bank, Kookmin Bank Cambodia Plc.	PRASAC Microfinance Institution Plc.	100.00	Cambodia	Microfinance services
Kookmin Bank	PT Bank KB Bukopin Tbk	67.00	Indonesia	Banking and foreign exchange transaction
PT Bank KB Bukopin Tbk	PT Bank Syariah Bukopin	92.78	Indonesia	Banking
PT Bank KB Bukopin Tbk	PT Bukopin Finance	97.04	Indonesia	Installment financing
Kookmin Bank	Orient Kwang-yang Co., Ltd. 2	36.16	Korea	Building of ships
Orient Kwang-yang Co., Ltd.	YoulChon Clean Energy Co., Ltd.	100.00	Korea	Other power generation
Kookmin Bank	Personal pension trust and 10 others 1	0.00	Korea	Trust
Kookmin Bank	KBL Incheon 1st L.L.C. and 48 others 2	0.00	Korea	Asset-backed securitization and others
Kookmin Bank	KB Wise Star Private Real Estate Feeder Fund No.1 2	86.00	Korea	Investment trust
Kookmin Bank	Kiwoom Frontier Private Securities Fund No.10 (Bond) 2	99.36	Korea	Investment trust
Kookmin Bank	Woori SafePlus Private Securities Fund S-8 2	90.85	Korea	Investment trust
Kookmin Bank	NH-Amundi Global Private Securities Investment Trust No.1 (USD) (Bond) 2	99.86	Korea	Investment trust
Kookmin Bank	Meritz Private Real Estate Fund No.9-2 2	99.98	Korea	Investment trust
Kookmin Bank	AIP US Red Private Real Estate Trust No.10 2	99.97	Korea	Investment trust
Kookmin Bank	KB KBSTAR 3-Year Futures Inverse Securities ETF (Debt-Derivative) 2	81.53	Korea	Investment trust
Kookmin Bank	KB Core Blind Private Real Estate Fund No.1 2	90.09	Korea	Investment trust
KB Core Blind Private Real Estate Fund No.1	KB Wise Star Real Estate Fund No.3 2	46.65	Korea	Investment trust
Kookmin Bank	KB Global Private Real Estate Debt Fund No.3 (USD) 2	99.50	Korea	Investment trust
Kookmin Bank	Samsung SRA Private Real Estate Investment Trust No.28D 2	99.50	Korea	Investment trust

167

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

38.1 Details of subsidiaries as of December 31, 2022, are as follows: (cont’d)

Investor	Investee	Ownership (%)	Location	Industry
Kookmin Bank	KB Global Private Real Estate Debt Fund No.10 2	99.83	Korea	Investment trust
Kookmin Bank	KTB Global CREDebt No.52 2	99.44	Korea	Investment trust
Kookmin Bank	Hyundai Invest KKR Europe Real Estate No.1-3 2	99.01	Korea	Investment trust
Kookmin Bank	KBSTAR FKTB 5Y Duration Following ETF 2	99.60	Korea	Investment trust
Kookmin Bank	Vestas Investors Private Real Estate Fund Investment Trust No.69-3 2	99.52	Korea	Investment trust
Kookmin Bank	KB KBSTAR FKTB 5Y Duration Following ETF 2	99.60	Korea	Investment trust
Kookmin Bank	SHINHAN ASP PCF II Private Investment Trust No.2 (USD) 2	99.75	Korea	Investment trust
Kookmin Bank	Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-1 2	97.40	Korea	Investment trust
Kookmin Bank	Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-2 2	97.40	Korea	Investment trust
Kookmin Bank	KB KBSTAR KTB 10Y Futures ETF 2	65.13	Korea	Investment trust
Kookmin Bank	VI ESG Private Securities Investment Trust No.1 (Bond) 2	100.00	Korea	Investment trust
Kookmin Bank	SHINHAN Aim Private Real Estate Fund Investment Trust No.26-C (USD) 2	99.98	Korea	Investment trust
Kookmin Bank	KB KBSTAR KTB 3Y Futures ETF 2	93.77	Korea	Investment trust
Kookmin Bank	SAMSUNG KODEX 10Y F-LKTB INVERSE ETF 2	95.53	Korea	Investment trust
Kookmin Bank	KB KBSTAR Nov 2025 Term Credit ETF 2	65.45	Korea	Investment trust

¹ The Group controls the trust because it has power to determine the management performance of the trust and is exposed to variable returns that absorb losses through the guarantees of payment of principal, or payment of principal and fixed rate of return.

² The Group controls these investees because it is significantly exposed to variable returns from the investees’ performance and has ability to affect those returns through its power.

The Group holds more than half of the ownership interests of Koreit BN Private Equity Fund and six other investment trusts but does not have the power over relevant activities in accordance with agreements with trust and other shareholders, therefore these entities are not consolidated.

168

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

38.2 The condensed financial information of major subsidiaries as of and for the years ended December 31, 2022 and 2021, are as follows:

	December 31, 2022							2022
(In millions of Korean won)	Assets		Liabilities		Equity			Operating revenue		Profit (loss) for the period
Kookmin Bank Cambodia Plc.		677,093		536,616		140,477			40,295		13,581
Kookmin Bank (China) Ltd.		3,666,107		3,164,601		501,506			230,027		(869	)
KB Microfinance Myanmar Co., Ltd.		20,111		9,475		10,636			5,379		(1,164	)
PRASAC Microfinance Institution Plc.		6,083,323		4,999,794		1,083,529			1,095,307		233,852
PT Bank KB Bukopin Tbk		6,533,161		6,661,179		(128,018	)		410,422		(802,084	)
KB Bank Myanmar Co., Ltd.		262,478		13,655		248,823			3,252		(1,333	)
Personal pension trust and 10 others		4,120,682		4,077,223		43,459			115,566		(76,182	)

	December 31, 2021						2021
(In millions of Korean won)	Assets		Liabilities		Equity		Operating revenue		Profit (loss) for the period
Kookmin Bank Cambodia Plc.		559,442		440,502		118,940		28,032		11,694
Kookmin Bank (China) Ltd.		3,812,297		3,295,555		516,742		182,989		14,064
KB Microfinance Myanmar Co., Ltd.		16,549		3,507		13,042		6,020		(6,249	)
PRASAC Microfinance Institution Plc.		5,128,845		4,329,971		798,874		796,169		205,342
PT Bank KB Bukopin Tbk		6,958,949		6,320,222		638,727		413,973		(272,526	)
KB Bank Myanmar Co., Ltd.		242,396		8,409		233,987		480		(3,005	)
Personal pension trust and 10 others		4,381,035		4,261,394		119,641		95,531		2,333

38.3 The Characteristics of Risks Associated with Consolidated Structured Entities

The terms of contractual arrangements to provide financial support to consolidated structured entities are as follows:

38.3.1 The Bank has provided capital commitments to consolidated investment funds.

	December 31, 2022
(In millions of Korean won)	Capital commitments		Unused amount
Meritz Private Real Estate Fund No.9-2		63,352		913
KTB Global CREDebt No.52(USD)		63,365		12,564
Hyundai Invest KKR Europe Real Estate No.1-3(EUR)		54,048		19,228
Vestas Investors Private Real Estate Fund Investment Trust No.69-3(USD)(FOF)		81,107		35,139
SHINHAN ASP PCF II Private Investment Trust No.2 (USD)		25,346		4,540
Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-1		67,258		53,914
SHINHAN Aim Private Real Estate Fund Investment Trust No.26-C (USD)		82,375		63,650

169

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

38.3.2 The Bank has provided purchase commitment and credit line to consolidated structured entities. The purchase commitment guarantees that the Bank will purchase and pay any remaining commercial paper securities issued by consolidated structured entities. The credit line agreement requires the Bank to provide loans under certain conditions if there is a reason for suspension of issuance of commercial paper securities or if consolidated structured entities become insolvency due to other reasons.

(In millions of Korean won)	December 31, 2022
KBL Incheon 1st L.L.C.		101,000
KB DTower 1st L.L.C.		50,510
KBH the 4th L.L.C.		12,200
Great Forest the 1st L.L.C.		10,200
KBH the 6th L.L.C.		50,106
Beomuh Landmark the 2nd L.L.C.		45,600
K Plus the 1st L.L.C.		110,279
KB Livv H 1st L.L.C.		30,097
Livv H 1st L.L.C.		50,152
KB Eagles 1st Co., Ltd.		30,097
KB Manchon Harrington Co., Ltd.		6,220
KB Livv l 1st Co., Ltd.		15,188
KB Cheongla Hill Co., Ltd.		60,550
KB Dong-in Central L.L.C.		20,094
KB Eagles 2nd Co., Ltd.		50,182
KBH Steal Co., Ltd.		150,204
KB Penta Co., Ltd.		20,910
KB Great Bear 1st L.L.C.		10,249
Ryan Mobility 1st L.L.C.		50,105
KB Chemical 1st Co., Ltd.		50,158
KB Harim 1st L.L.C.		30,139
KB Eagles 3rd Co., Ltd.		50,164
KB Winchest 1st Co., Ltd.		10,500
KB Dong-in Central 1st L.L.C.		300
LEP 2nd Co., Ltd.		10,000
KB River County L.L.C.		29,000
KB Buamsamjung 1st Co., Ltd.		36,039
Liiv H 2nd Co., Ltd.		30,028
KB Sungnae 1st L.L.C.		65,000
JT Capital 7th Asset Securitization Specialty Company		15,600
KB Landscape 1st L.L.C.		72,900
KB Pride 1st L.L.C.		23,250
KB Pride 2nd L.L.C.		30,184
KB Moonheung 1st Co., Ltd.		160
KB One West 1st Co., Ltd.		1,164
KB Cloud L.L.C.		10,831
K Gowoon Sekyo 1st Co., Ltd.		644
K Gowoon Sekyo 2nd Co., Ltd.		1,341
KB Great29 1st Co., Ltd.		57,600
IDMB UNITED PTE.LTD.		259,797
Liiv H 3rd Co., Ltd.		50,595

170

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

38.3.3 The Group has provided the guarantees of payment of principal, or principal and fixed rate of return in case the operating results of the trusts are less than the guaranteed principal, or principal and fixed rate of return.

38.4 Changes in Subsidiaries

NICE WONHO 1st Co., Ltd. and 24 other subsidiaries were newly included in the scope of consolidation, and KB Happy 1st L.L.C. and 28 other subsidiaries were excluded from the scope of consolidation for the year ended December 31, 2022.

38.5 Net Cash Flow from Changes in Subsidiaries

The net cash inflows arising from acquisition of subsidiaries and net cash inflows arising from disposal of subsidiaries are amounting to W 2,800 million and W 52,569 million for the year ended December 31, 2022, respectively.

171

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

39. Unconsolidated Structured Entities

39.1 Nature, purpose, and activities of the unconsolidated structured entities and how the structured entities are financed, are as follows:

Nature	Purpose	Activity	Method of financing
Asset-backed securitization	Early cash generation through transfer of securitized assets Fees earned through services to SPC, such as providing lines of credit and ABCP purchase commitments	Fulfillment of asset-backed securitization plan Purchase and collection of securitized assets Issuance and repayment of ABS and ABCP	Issuance of ABS and ABCP based on securitized assets
Structured financing	Granting PF loans to SOC and real estate Granting loans to ships/aircrafts SPC Project financing to M&A and others	Construction of SOC and real estate Building ships, construction and purchase of aircrafts M&A	Loan commitments through credit line, providing credit line, and investment agreements
Investment funds	Investment in beneficiary certificates Investment in PEF and partnerships	Management of fund assets Payment of fund fees and allocation of fund profits	Sales of beneficiary certificate instruments Investment from general partners and limited partners

172

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

39.2 Details of scale of unconsolidated structured entities and nature of the risks associated with the Group’s interests in unconsolidated structured entities as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Asset-backed securitization		Structured financing		Investment funds		Total
Total assets of unconsolidated structured entities		100,277,020		61,285,981		233,155,749		394,718,750
Carrying amount in the financial statements
Assets:
Financial assets at fair value through profit or loss		134,560		34,640		5,094,475		5,263,675
Loans measured at amortized cost		424,111		4,852,076		—		5,276,187
Financial investments		7,381,323		—		—		7,381,323
Investments in associates		—		—		329,626		329,626
Other assets		—		616		2		618
		7,939,994		4,887,332		5,424,103		18,251,429
Liabilities:
Deposits		219,641		1,596,011		78,705		1,894,357
Derivative financial liabilities		—		—		—		—
Other liabilities		2,302		1,561		97		3,960
		221,943		1,597,572		78,802		1,898,317
Maximum exposure
Assets held *		7,939,994		4,887,332		5,424,103		18,251,429
Purchase and investment commitments		371,200		—		4,355,121		4,726,321
Acceptances and guarantees and unused line of credit		6,097,582		1,640,709		—		7,738,291
		14,408,776		6,528,041		9,779,224		30,716,041
Methods of determining the maximum exposure		Providing lines of credit / Purchase commitments/ Acceptances and guarantees / Investment commitments		Acceptances and guarantees / Providing lines of credit		Purchase commitments /Investment commitments

173

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

39.2 Details of scale of unconsolidated structured entities and nature of the risks associated with the Group’s interests in unconsolidated structured entities as of December 31, 2022 and 2021, are as follows: (cont’d)

	December 31, 2021
(In millions of Korean won)	Asset-backed securitization		Structured Financing		Investment funds		Total
Total assets of unconsolidated structured entities		99,788,024		52,936,733		135,096,320		287,821,077
Carrying amount in the financial statements
Assets:
Financial assets at fair value through profit or loss		167,915		39,047		3,555,696		3,762,658
Loans measured at amortized cost		41,068		5,098,265		—		5,139,333
Financial investments		7,471,873		—		—		7,471,873
Investments in associates		—		—		285,895		285,895
Other assets		—		423		2		425
		7,680,856		5,137,735		3,841,593		16,660,184
Liabilities:
Deposits		330,592		650,834		86,185		1,067,611
Derivative financial liabilities		437		—		—		437
Other liabilities		2,532		3,030		15		5,577
		333,561		653,864		86,200		1,073,625
Maximum exposure
Assets held *		7,680,856		5,137,735		3,841,593		16,660,184
Purchase and investment commitments		—		—		3,863,104		3,863,104
Acceptances and guarantees and unused line of credit		5,353,985		1,636,416		—		6,990,401
		13,034,841		6,774,151		7,704,697		27,513,689
Methods of determining the maximum exposure		Providing lines of credit / Purchase commitments/ Acceptances and guarantees and loan commitments		Loan commitments / Investment commitments / Purchase commitments and acceptances and guarantees		Investment commitments

* Maximum exposure includes the asset amounts, after deducting loss (provisions for credit losses, impairment losses, and others), recognized in the consolidated financial statements of the Group.

174

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

40. Lease

40.1 The Group as a Lessee

40.1.1 Amounts recognized in the consolidated statements of financial position related to lease as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Right-of-use property and equipment: *
Real estate		371,926		370,146
Vehicles		10,507		10,970
Others		4,401		10,018
		386,834		391,134
Right-of-use intangible assets *		2,602		3,610
		389,436		394,744
Lease liabilities *		372,003		375,472

* Included in property and equipment, intangible assets, and other liabilities.

40.1.2 Amounts recognized in the consolidated statements of comprehensive income related to lease for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Depreciation and amortization of right-of-use assets:
Real estate		192,920		196,687
Vehicles		11,035		11,379
Others		5,291		6,672
Intangible asset		1,007		1,007
		210,253		215,745
Interest expenses on the lease liabilities		11,153		10,328
Expense relating to short-term lease		3,222		3,094
Expense relating to lease of low-value assets that are not short-term lease		3,486		3,060

Total cash outflows for lease for the years ended December 31, 2022 and 2021 are W 163,763 million and W 169,108 million, respectively.

40.2 The Group as an Operating Lessor

The future minimum lease payments to be received from the non-cancellable lease contracts as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Up to 1 year		20,875		20,081
1-5 years		29,373		33,211
Over 5 years		—		—
		50,248		53,292

175

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41. Related Party Transactions

According to Korean IFRS No.1024, the Group includes the Parent, the Parent’s subsidiaries, associates, associates of the Parent’s subsidiaries, associates of the Parent, key management personnel (including family members), and post-employment benefit plans of the Group and its related party companies in the scope of related parties. The Group discloses balances (receivables and payables) and other amounts arising from transactions with related parties in the notes to the consolidated financial statements. Refer to Note 13 for details of investments in associates.

Key management personnel include the executives of the Parent Company and the executives (managing director and above) of the Bank, and companies where the executives and/or their close family members have control or joint control.

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		2022		2021
Parent
KB Financial Group Inc.	Fee and commission income		9,493		7,440
	Other non-operating income		1,985		1,638
	Interest expense		6,345		1,708
	Other operating expenses		—		273
	General and administrative expenses		1,262		926
Parent’s subsidiaries
KB Securities Co., Ltd.	Interest income		7,571		2,897
	Fee and commission income		26,105		27,878
	Gains on financial instruments at fair value through profit or loss		235,328		92,627
	Other non-operating income		4,613		4,371
	Interest expense		4,533		2,020
	Fee and commission expense		2,353		785
	Losses on financial instruments at fair value through profit or loss		168,852		108,706
	Provision for credit losses		106		146
	Other non-operating expenses		1		—
	General and administrative expenses		3,233		3,242

176

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Asset Management Co., Ltd.	Fee and commission income		2,053		1,959
	Gains on financial instruments at fair value through profit or loss		1,050		178
	Interest expense		143		43
	Fee and commission expense		3,851		1,703
	Losses on financial instruments at fair value through profit or loss		9		98
	General and administrative expenses		500		500
KB Real Estate Trust Co., Ltd.	Fee and commission income		315		268
	Other non-operating income		34		35
	Interest expense		258		119
	Fee and commission expense		1,641		1,806
KB Investment Co., Ltd.	Fee and commission income		109		126
	Interest expense		1,647		344
KB Credit Information Co., Ltd.	Fee and commission income		75		71
	Other non-operating income		165		143
	Interest expense		139		69
	Fee and commission expense		18,146		20,953
	Other operating expenses		16		—
KB Data System Co., Ltd.	Fee and commission income		788		432
	Other non-operating income		185		182
	Interest expense		183		152
	Other operating expenses		419		349
	General and administrative expenses		110,623		60,374
KB Life Insurance Co., Ltd.	Interest income		83		—
	Fee and commission income		21,447		17,258
	Gains on financial instruments at fair value through profit or loss		14,050		8,154
	Other non-operating income		56		48
	Interest expense		13		11
	Fee and commission expense		579		956
	Losses on financial instruments at fair value through profit or loss		2,060		414
	Other operating expenses		1		—
	Provision for credit losses		224		—
	General and administrative expenses		890		888

177

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Kookmin Card Co., Ltd.	Interest income		9,925		4,985
	Fee and commission income		161,910		167,764
	Gains on financial instruments at fair value through profit or loss		2,087		287
	Reversal of credit losses		178		6
	Other non-operating income		1,473		1,682
	Interest expense		955		937
	Fee and commission expense		1,742		1,222
	Losses on financial instruments at fair value through profit or loss		1,399		363
	Provision for credit losses		—		327
	General and administrative expenses		1,469		1,301
KB Savings Bank Co., Ltd.	Fee and commission income		455		984
	Other non-operating income		31		82
	Interest expense		10		16
	General and administrative expenses		3		6
KB Capital Co., Ltd.	Interest income		2,475		1,529
	Fee and commission income		3,759		2,900
	Reversal of credit losses		—		245
	Other non-operating income		171		155
	Interest expense		248		74
	Fee and commission expense		119		4
	Provision for credit losses		28		—
	General and administrative expenses		—		139
KB Insurance Co., Ltd.	Interest income		569		303
	Fee and commission income		27,195		26,351
	Gains on financial instruments at fair value through profit or loss		137,527		69,366
	Reversal of credit losses		9		—
	Other non-operating income		2,036		1,842
	Interest expense		1,075		1,592
	Fee and commission expense		3,953		2,983
	Losses on financial instruments at fair value through profit or loss		33,916		1,333
	Other operating expenses		3		3
	Provision for credit losses		—		10
	Other non-operating expenses		—		11
	General and administrative expenses		13,745		13,590

178

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Interest income		66		46
	Fee and commission income		146		103
	Gains on financial instruments at fair value through profit or loss		33,293		6,968
	Other non-operating income		89		—
	Interest expense		4,045		3,736
	Fee and commission expense		4,136		4,374
	Losses on financial instruments at fair value through profit or loss		638		652
	General and administrative expenses		963		604
KB STAR REIT Co., Ltd.	Interest income		374		—
	Fee and commission income		33		—
	Gains on financial instruments at fair value through profit or loss		96		—
	Interest expense		9		—
	Losses on financial instruments at fair value through profit or loss		13,565		—
KB Hanbando BTL Private Special Asset Fund No.1	Fee and commission income		108		119
KB AMP Infra Private Special Asset Fund No.1(FoFs)	Fee and commission income		8		9
KB AMP Infra Private Special Asset Fund No.13(FoFs)	Fee and commission income		5		1
KB Muni bond Private Securities Fund No.1 (USD)	Fee and commission income		11		11
KB Global Private Real Estate Debt Fund No.1	Fee and commission income		11		10
KB Global Private Real Estate Debt Fund No.11	Fee and commission income		3		1
KB Global Private Real Estate Debt Fund No.15	Fee and commission income		10		2
KB Global Private Real Estate Debt Fund No.17	Fee and commission income		4		—
KB NA COMPASS Energy Private Special Asset Fund *	Fee and commission income		2		7
KB Star Office Private Real Estate Master Fund No.3	Other operating income		3,276		—
	Interest expense		—		3
KB Star Office Private Real Estate Feeder Fund No.4	Interest income		760		760
	Fee and commission income		37		37
	Interest expense		7		5
	Provision for credit losses		1		1

179

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Global Core Bond Securities Feeder Fund(Bond)	Fee and commission income		16		45
	Gains on financial instruments at fair value through profit or loss		459		1,020
	Losses on financial instruments at fair value through profit or loss		61		280
KB Onkookmin Life Income 20 Feeder Fund (FoFs)	Gains on financial instruments at fair value through profit or loss		—		266
	Losses on financial instruments at fair value through profit or loss		—		48
KB Onkookmin Life Income 40 Feeder Fund (FoFs)	Gains on financial instruments at fair value through profit or loss		—		261
	Losses on financial instruments at fair value through profit or loss		—		41
KB New Renewable Energy Private Special Asset Fund No.1	Fee and commission income		9		8
KB North America Private Real Estate Debt Fund No.1	Fee and commission income		3		3
	Gains on financial instruments at fair value through profit or loss		2,202		2,502
	Losses on financial instruments at fair value through profit or loss		51		—
KB North America Private Real Estate Debt Fund No.3	Fee and commission income		10		10
	Gains on financial instruments at fair value through profit or loss		9,525		8,580
	Losses on financial instruments at fair value through profit or loss		2,259		536
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)	Fee and commission income		5		4
KB Global Infrastructure Synergy Private Special Asset Fund	Fee and commission income		5		3
	Gains on financial instruments at fair value through profit or loss		76		—

180

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB BMO Senior Loan Private Special Asset Fund No.1(FOF)	Fee and commission income		10		8
	Gains on financial instruments at fair value through profit or loss		2,515		5,722
	Losses on financial instruments at fair value through profit or loss		2,001		759
KB BMO Senior Loan Private Special Asset Fund No.2(USD)	Fee and commission income		10		8
KB BMO Senior Loan Private Special Asset Fund No.4(USD)	Fee and commission income		4		—
KB BMO Senior Loan Private Special Asset Fund No.5(FOF)	Fee and commission income		6		—
KB New Renewable Green New Deal Private Special Asset No.2	Fee and commission income		8		2
KB Sinansan Line Private Special Asset Fund(SOC)	Fee and commission income		23		12
KB Korea Short Term Premium Private Securities No.19(USD)(Bond) *	Fee and commission income		—		4
KB Korea Short Term Premium Private Securities No.21(USD)(Bond) *	Fee and commission income		1		5
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *	Fee and commission income		8		3
	Losses on financial instruments at fair value through profit or loss		510		1,306
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *	Fee and commission income		12		2
	Gains on financial instruments at fair value through profit or loss		—		96
	Losses on financial instruments at fair value through profit or loss		15,167		—
KB Korea Short Term Premium Private Securities No.25(USD)(Bond)	Fee and commission income		11		—
	Losses on financial instruments at fair value through profit or loss		2,891		—
KB Korea Short Term Premium Private Securities No.26(USD)(Bond)	Fee and commission income		7		—
	Losses on financial instruments at fair value through profit or loss		1,839		—
KB Korea Short Term Premium Private Securities No.27(USD)(Bond)	Fee and commission income		11		—
	Losses on financial instruments at fair value through profit or loss		3,502		—

181

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Korea Short Term Premium Private Securities No.28(USD)(Bond) *	Fee and commission income		10		—
	Losses on financial instruments at fair value through profit or loss		11,191		—
KB Korea Short Term Premium Private Securities No.32(USD)(Bond)	Fee and commission income		5		—
	Gains on financial instruments at fair value through profit or loss		5,377		—
KB Korea Short Term Premium Private Securities No.33(USD)(Bond)	Gains on financial instruments at fair value through profit or loss		1,557		—
KB Multi Alpha Plus Private Fund No.1	Fee and commission income		8		6
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)	Fee and commission income		23		8
KB New Deal Infra Private Special Asset Fund	Fee and commission income		2		—
KB Korea Infrastructure Credit Guarantee Private Special Asset No.1	Fee and commission income		16		5
KB Wise Star Private Real Estate No.19	Fee and commission income		6		3
Hanwha Europe Credit Private Fund No.16 (FOF)	Gains on financial instruments at fair value through profit or loss		514		36
	Losses on financial instruments at fair value through profit or loss		746		175
KB Logistics Blind Private Real Estate Fund No.1	Interest income		1,129		—
	Fee and commission income		48		2
	Provision for credit losses		2		—
KB Aircraft Private Special Asset Fund No.1	Fee and commission income		13		4
	Gains on financial instruments at fair value through profit or loss		74		—
	Losses on financial instruments at fair value through profit or loss		1,761		3,849
KB Star ESG Prime Mid-Short Bond Securities Feeder Fund(Bond)	Fee and commission income		15		5
KB Oaktree Private Special Asset Fund No.3	Fee and commission income		2		—
KB GK Project Private Special Asset Fund No.3	Fee and commission income		44		—
KB AMP Infra Note Private Special Asset Fund No.14	Fee and commission income		5		—

182

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB ASF Infra Private Special Asset Fund(FoFs)	Fee and commission income		1		—
	Gains on financial instruments at fair value through profit or loss		48		—
	Losses on financial instruments at fair value through profit or loss		587		—
KB Duke Private Special Asset Fund	Fee and commission income		4		—
KB Star Reits Private Real Estate Feeder Fund No.1	Fee and commission income		2		—
KB Star Reits Private Real Estate Feeder Fund No.2	Fee and commission income		4		—
HSBC Senior UK Direct Lending Fund 2020 RAIF SICAV-S.A.	Fee and commission income		1		—
NB Private Debt Fund IV LUX (B) SCSP	Fee and commission income		1		—
Mirova Eurofideme	Fee and commission income		1		—
KB Senior Loan Private Fund No.1 *	Fee and commission income		—		1
KB Korea Short Term Premium Private Securities No.15(USD)(Bond) *	Fee and commission income		—		3
	Losses on financial instruments at fair value through profit or loss		—		1,614
KB Korea Short Term Premium Private Securities No.17(USD)(Bond) *	Fee and commission income		—		10
	Losses on financial instruments at fair value through profit or loss		—		6,153
Associates
Korea Credit Bureau Co., Ltd.	Fee and commission income		52		36
	Interest expense		1		6
	Fee and commission expense		1,996		1,860
	Other operating expenses		15		11
Incheon Bridge Co., Ltd.	Interest income		7,516		4,069
	Fee and commission income		23		22
	Reversal of credit losses		28		444
	Interest expense		517		158
	Fee and commission expense		6		6
	Losses on financial instruments at fair value through profit or loss		4,434		1,374
Kendae Co., Ltd.	Other non-operating expenses		3		—
Dongjo Co., Ltd.	Interest income		9		—
Dae-A Leisure Co., Ltd.	Interest expense		—		2
Skydigital Inc.	Fee and commission income		3		3
Il-Kwang Electronic Materials Co., Ltd.	Other non-operating expenses		1		—
So-Myung Recycling Co., Ltd.	Other non-operating expenses		2		—
TMAPMOBILITY CO.,LTD.	Interest expense		226		—

183

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB High-Tech Company Investment Fund	Interest expense		3		8
Aju Good Technology Venture Fund	Interest expense		108		27
KB-KDBC Pre-IPO New Technology Business Investment Fund	Interest expense		1		1
KB Digital Innovation & Growth New Technology Business Investment Fund	Interest expense		4		3
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Interest expense		6		17
KB Global Platform Fund	Interest expense		114		39
WJ Private Equity Fund No.1	Fee and commission income		7		7
KB Bio Global Expansion Private Equity Fund No.1	Interest expense		9		—
KB Digital Platform Fund	Interest expense		116		—
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 *	Interest expense		2		5
Star-Lord General Investors Private Real Estate Investment Company No.10	Interest income		3,098		—
	Interest expense		60		—
	Provision for credit losses		1		—
Associates of Parent’s subsidiaries
SY Auto Capital Co., Ltd.	Fee and commission income		4		4
Food Factory Co., Ltd.	Interest income		80		70
	Fee and commission income		1		—
	Reversal of credit losses		1		6
	Interest expense		6		5
	Fee and commission expense		—		2
BIKDIPEO CO.,LTD.	Interest expense		1		—
Banksalad Co., Ltd.	Fee and commission income		36		36
Spark Biopharma Inc.	Interest expense		272		7
UPRISE, Inc.	Interest income		—		5
	Reversal of credit losses		—		1
	Interest expense		3		1
Channel Corporation	Interest expense		43		—
COSES GT Co., Ltd.	Interest income		23		18
	Reversal of credit losses		—		3
	Interest expense		1		1
	Provision for credit losses		3		—
KB No.17 Special Purpose Acquisition Company *	Interest expense		1		14
KB No.18 Special Purpose Acquisition Company *	Interest expense		5		20
KB No.19 Special Purpose Acquisition Company *	Interest expense		5		9
KB No.20 Special Purpose Acquisition Company *	Interest expense		22		15

184

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB No.21 Special Purpose Acquisition Company	Interest expense		30		—
KB No.22 Special Purpose Acquisition Company	Interest expense		1		—
KB No.23 Special Purpose Acquisition Company	Interest expense		23		—
KB No.24 Special Purpose Acquisition Company	Interest expense		1		—
SwatchOn Inc. *	Fee and commission income		5		8
	Interest expense		5		10
Gomi corporation Inc.	Interest income		61		19
	Fee and commission income		1		—
	Interest expense		2		1
	Provision for credit losses		2		13
S&E bio Co., Ltd.	Interest expense		2		1
Contents First Inc.	Interest income		128		—
	Fee and commission income		1		—
	Interest expense		34		83
	Provision for credit losses		1		—
GENINUS Inc. *	Interest expense		12		29
Mantisco Co., Ltd.	Interest expense		1		1
Pin Therapeutics Inc.	Interest expense		110		—
SuperNGine Co., Ltd.	Interest expense		—		1
Desilo Inc.	Interest income		9		1
	Provision for credit losses		—		2
Turing Co., Ltd.	Interest expense		1		1
IGGYMOB Co., Ltd.	Interest expense		1		1
Kukka Co., Ltd.	Interest expense		2		—
Zipdoc Inc.	Interest expense		1		—
TeamSparta Inc.	Interest expense		19		—
Chabot Mobility Co., Ltd.	Interest expense		1		—
Wemade Connect Co., Ltd.	Interest expense		81		—
Nextrade Co., Ltd.	Interest expense		263		—
KB Pre IPO Secondary Venture Fund No.1 *	Interest expense		—		1
Others
Retirement pension	Fee and commission income		1,352		1,338
	Interest expense		39		9

* Excluded from the Group’s related party as of December 31, 2022.

185

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent
KB Financial Group Inc.	Other assets		97		71
	Deposits		231,056		518,076
	Other liabilities		828,908		462,800
Parent’s subsidiaries
KB Securities Co., Ltd.	Cash and due from financial institutions		8,116		4,691
	Derivative assets		134,303		43,797
	Loans measured at amortized cost (gross amount)		141,922		124,527
	Allowances for credit losses		358		201
	Other assets		6,186		5,564
	Derivative liabilities		33,258		33,338
	Deposits		863,614		535,130
	Provisions		36		90
	Other liabilities 2		29,440		29,920
KB Asset Management Co., Ltd.	Other assets		413		422
	Deposits		25,950		13,206
	Other liabilities 3		3,911		1,304
KB Real Estate Trust Co., Ltd.	Other assets		2		3
	Deposits		48,600		103,329
	Other liabilities 4		2,276		3,438
KB Investment Co., Ltd.	Deposits		81,064		100,338
	Other liabilities		707		42
KB Credit Information Co., Ltd.	Deposits		13,430		4,536
	Other liabilities		5,475		5,656
KB Data System Co., Ltd.	Other assets		317		215
	Deposits		20,924		17,999
	Other liabilities		7,381		6,150
KB Life Insurance Co., Ltd.	Derivative assets		773		5,387
	Other assets		1,502		1,519
	Derivative liabilities		2,060		168
	Deposits		788		2,608
	Provisions		224		—
	Other liabilities 5		16,096		21,700
KB Kookmin Card Co., Ltd.	Derivative assets		—		55
	Loans measured at amortized cost (gross amount)		197,647		71,130
	Allowances for credit losses		207		86
	Other assets		22,737		22,043
	Derivative liabilities		884		—
	Deposits		110,252		81,641
	Borrowings		3,694		3,492
	Provisions		423		724
	Other liabilities		55,132		47,443
KB Savings Bank Co., Ltd.	Other liabilities		606		323

186

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB Capital Co., Ltd.	Loans measured at amortized cost (gross amount)		45,192		71,130
	Allowances for credit losses		52		156
	Other assets		594		365
	Deposits		708,518		219,312
	Provisions		182		45
	Other liabilities		3,067		3,006
KB Insurance Co., Ltd.	Derivative assets		137,320		37,098
	Loans measured at amortized cost (gross amount)		18,390		17,958
	Allowances for credit losses		5		3
	Other assets		12,599		15,707
	Derivative liabilities		29,632		3,670
	Deposits		65,231		7,854
	Borrowings 7		23,000		23,000
	Debentures		—		29,998
	Provisions		7		18
	Other liabilities 6		18,631		17,757
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Derivative assets		13,582		6,968
	Other assets		3,880		3,815
	Derivative liabilities		642		652
	Deposits		7,779		7,634
	Debentures		30,000		30,000
	Other liabilities		43,878		38,100
KB STAR REIT Co., Ltd.	Other assets		21		—
	Derivative liabilities		8,089		—
	Deposits		35,053		—
	Other liabilities		1		—
KB Hanbando BTL Private Special Asset Fund No.1	Other assets		26		29
KB AMP Infra Private Special Asset Fund No.1(FoFs)	Other assets		1		1
KB AMP Infra Private Special Asset Fund No.13(FoFs)	Other assets		2		1
KB Muni bond Private Securities Fund No.1 (USD)	Other assets		2		2
KB Global Private Real Estate Debt Fund No.1	Other assets		3		3
KB Global Private Real Estate Debt Fund No.11	Other assets		1		—
KB Global Private Real Estate Debt Fund No.15	Other assets		2		2
KB Global Private Real Estate Debt Fund No.17	Other assets		1		—
KB NA COMPASS Energy Private Special Asset Fund 1	Other assets		—		1
KB Star Office Private Real Estate Master Fund No.3	Deposits		—		171
	Other liabilities		—		9

187

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB Star Office Private Real Estate Feeder Fund No.4	Loans measured at amortized cost (gross amount)		20,000		20,000
	Allowances for credit losses		4		3
	Other assets		13		11
	Deposits		215		532
	Other liabilities		4		1
KB Global Core Bond Securities Feeder Fund(Bond)	Derivative assets		—		7
	Other assets		2		4
	Derivative liabilities		—		6
KB New Renewable Energy Private Special Asset Fund No.1	Other assets		2		2
KB North America Private Real Estate Debt Fund No.1	Derivative assets		—		1,378
	Other assets		1		1
	Derivative liabilities		51		—
KB North America Private Real Estate Debt Fund No.3	Derivative assets		2,411		1,221
	Other assets		3		2
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)	Other assets		1		1
KB Global Infrastructure Synergy Private Special Asset Fund	Other assets		1		1
KB BMO Senior Loan Private Special Asset Fund No.1(FOF)	Derivative assets		—		3,275
	Other assets		3		2
	Derivative liabilities		2,001		—
KB BMO Senior Loan Private Special Asset Fund No.2(USD)	Other assets		2		2
KB BMO Senior Loan Private Special Asset Fund No.4(USD)	Other assets		2		—
KB BMO Senior Loan Private Special Asset Fund No.5(FOF)	Other assets		3		—
KB New Renewable Green New Deal Private Special Asset No.2	Other assets		2		1
KB Sinansan Line Private Special Asset Fund(SOC)	Other assets		7		4
KB Korea Short Term Premium Private Securities No.19(USD)(Bond) 1	Other assets		—		2
KB Korea Short Term Premium Private Securities No.21(USD)(Bond) 1	Other assets		—		2
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) 1	Other assets		—		1
	Derivative liabilities		—		1,306
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) 1	Derivative assets		—		96
	Other assets		—		2
KB Korea Short Term Premium Private Securities Fund No.25(USD)(Bond)	Other assets		5		—
	Derivative liabilities		2,891		—

188

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB Korea Short Term Premium Private Securities Fund No.26(USD)(Bond)	Other assets		3		—
	Derivative liabilities		1,839		—
KB Korea Short Term Premium Private Securities Fund No.27(USD)(Bond)	Other assets		5		—
	Derivative liabilities		3,502		—
KB Korea Short Term Premium Private Securities Fund No.32(USD)(Bond)	Derivative assets		5,377		—
	Other assets		5		—
KB Korea Short Term Premium Private Securities Fund No.33(USD)(Bond)	Derivative assets		1,557		—
KB Multi Alpha Plus Private Fund No.1	Other assets		2		2
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)	Other assets		6		7
KB New Deal Innovation Fund	Other assets		1		—
KB Korea Infrastructure Credit Guarantee Private Special Asset No.1	Other assets		3		2
Hanwha Europe Credit Private Fund No.16 (FOF)	Derivative assets		—		9
	Derivative liabilities		744		119
KB Logistics Blind Private Real Estate Fund No.1	Loans measured at amortized cost (gross amount)		52,500		—
	Allowances for credit losses		2		—
	Other assets		374		2
KB Aircraft Private Special Asset Fund No.1	Other assets		2		2
	Derivative liabilities		5,096		3,835
KB Star ESG Prime Mid-Short Bond Securities Feeder Fund(Bond)	Other assets		1		1
KB GK Project Private Special Asset Fund No.3	Other assets		5		—
KB AMP Infra Note Private Special Asset Fund No.14	Other assets		1		—
	Derivative liabilities		479		—
KB Duke Private Special Asset Fund	Other assets		1		—
KB Star Reits Private Real Estate Feeder Fund No.1	Other assets		2		—
KB Star Reits Private Real Estate Feeder Fund No.2	Other assets		4		—
HSBC Senior UK Direct Lending Fund 2020 RAIF SICAV-S.A.	Other assets		1		—
NB Private Debt Fund IV LUX (B) SCSP	Other assets		1		—

189

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
Associates
Korea Credit Bureau Co., Ltd.	Deposits		27,889		10,200
Incheon Bridge Co., Ltd.	Financial assets at fair value through profit or loss		32,948		37,382
	Loans measured at amortized cost (gross amount)		95,200		114,100
	Allowances for credit losses		8		25
	Other assets		615		423
	Deposits		48,639		35,487
	Provisions		7		18
	Other liabilities		446		99
Jungdo Co., Ltd.	Deposits		4		4
Dae-A Leisure Co., Ltd.	Deposits		154		17
Iwon Alloy Co., Ltd.	Deposits		1		—
Computerlife Co., Ltd.	Deposits		3		—
Skydigital Inc.	Deposits		10		85
Jo Yang Industrial Co., Ltd.	Deposits		—		1
TMAPMOBILITY CO.,LTD.	Deposits		30,000		—
	Other liabilities		76		—
KB High-Tech Company Investment Fund	Deposits		688		1,504
Aju Good Technology Venture Fund	Deposits		7,222		6,286
	Other liabilities		73		10
KB-KDBC Pre-IPO New Technology Business Investment Fund	Deposits		317		904
KB Digital Innovation & Growth New Technology Business Investment Fund	Deposits		674		2,088
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Deposits		1,526		1,524
	Other liabilities		1		—
KB Global Platform Fund	Deposits		19,655		26,823
	Other liabilities		12		5
WJ Private Equity Fund No.1	Other assets		2		2
	Deposits		221		260
KB Bio Global Expansion Private Equity Fund No.1	Deposits		1,400		—
	Other liabilities		9		—
KB Digital Platform Fund	Deposits		15,000		—
	Other liabilities		2		—

190

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 1	Deposits		—		2,578
Star-Lord General Investors Private Real Estate Investment Company No.10	Loans measured at amortized cost (gross amount)		149,294		—
	Allowances for credit losses		1		—
	Other assets		3,208		—
Associates of Parent’s subsidiaries
SY Auto Capital Co., Ltd.	Deposits		10		17
RAND Bio Science Co., Ltd.	Deposits		3		443
Food Factory Co., Ltd.	Loans measured at amortized cost (gross amount)		3,337		3,545
	Allowances for credit losses		4		4
	Other assets		4		2
	Deposits		664		839
	Other liabilities		1		6
Acts Co., Ltd. 1	Deposits		—		154
Paycoms Co., Ltd.	Deposits		1		1
Big Dipper Co., Ltd.	Deposits		19		—
Spark Biopharma Inc.	Deposits		17,534		6,015
	Other liabilities		91		3
Wyatt Corp.	Deposits		1		1
UPRISE, Inc.	Deposits		27		4,001
CellinCells Co., Ltd.	Deposits		37		38
Channel Corporation	Deposits		3,000		—
	Other liabilities		21		—
COSES GT Co., Ltd.	Loans measured at amortized cost (gross amount)		500		500
	Allowances for credit losses		4		2
	Other assets		2		1
	Deposits		1,213		1,939
KB No.17 Special Purpose Acquisition Company 1	Deposits		—		1,687
	Other liabilities		—		12
KB No.18 Special Purpose Acquisition Company 1	Deposits		—		2,077
	Other liabilities		—		12
KB No.19 Special Purpose Acquisition Company 1	Deposits		—		1,013
	Other liabilities		—		5
KB No.20 Special Purpose Acquisition Company 1	Deposits		—		1,681
	Other liabilities		—		3

191

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB No.21 Special Purpose Acquisition Company	Deposits		2,263		—
	Other liabilities		29		—
KB No.22 Special Purpose Acquisition Company	Deposits		1,948		—
KB No.23 Special Purpose Acquisition Company	Deposits		2,205		—
	Other liabilities		22		—
KB No.24 Special Purpose Acquisition Company	Deposits		9,983		—
	Other liabilities		1		—
SwatchOn Inc. 1	Deposits		—		686
Gomi corporation Inc.	Loans measured at amortized cost (gross amount)		2,200		2,200
	Allowances for credit losses		15		12
	Other assets		5		4
	Deposits		915		3,188
	Other liabilities		1		1
S&E bio Co., Ltd.	Deposits		6,419		263
	Other liabilities		1		—
4N Inc.	Deposits		5		39
Contents First Inc.	Loans measured at amortized cost (gross amount)		10,017		—
	Allowances for credit losses		1		—
	Other assets		2		—
	Deposits		5,010		12,650
	Other liabilities		21		57
December & Company Inc.	Deposits		1		1
GENINUS Inc. 1	Deposits		—		34,415
	Other liabilities		—		2
Mantisco Co., Ltd.	Deposits		623		386
Pin Therapeutics Inc.	Deposits		6,033		—
	Other liabilities		18		—
G1 Playground Co., Ltd.	Deposits		—		354
SuperNGine Co., Ltd.	Deposits		17		944
Desilo Inc.	Loans measured at amortized cost (gross amount)		300		301
	Allowances for credit losses		2		2
	Deposits		1		168
Turing Co., Ltd.	Deposits		2,788		1,054
IGGYMOB Co., Ltd.	Deposits		254		2,938
ZIPDOC Inc.	Deposits		915		—

192

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
TeamSparta Inc.	Deposits		12,502		—
	Other liabilities		6		—
Chabot Mobility Co., Ltd.	Deposits		86		—
Wemade Connect Co., Ltd.	Deposits		10,370		—
	Other liabilities		28		—
Nextrade Co., Ltd.	Deposits		56,202		—
	Other liabilities		263		—
KB Pre IPO Secondary Venture Fund No.1 1	Deposits		—		103
Key management personnel	Loans measured at amortized cost (gross amount)		4,391		3,252
	Allowances for credit losses		2		2
	Other assets		6		3
	Deposits		11,974		11,757
	Provisions		1		1
	Other liabilities		284		255
Others
Retirement pension	Other assets		778		369
	Other liabilities		10,141		5,014

¹  Excluded from the Group’s related party as of December 31, 2022.

²  Non-controlling interests classified as liabilities include W 1,919 million and W 3,089 million as of December 31, 2022 and 2021, respectively.

³  Non-controlling interests classified as liabilities include W 1,077 million and W 986 million as of December 31, 2022 and 2021, respectively.

⁴  Non-controlling interests classified as liabilities include W 1,919 million and W 3,085 million as of December 31, 2022 and 2021, respectively.

⁵  Non-controlling interests classified as liabilities include W 14,978 million and W 20,355 million as of December 31, 2022 and 2021, respectively.

⁶  Non-controlling interests classified as liabilities include W 5,385 million and W 4,931 million as of December 31, 2022 and 2021, respectively.

⁷  This is the carrying amount of liabilities held through a subsidiary, a company specialized in asset-backed securitization, and the related underlying assets after deducting allowance for credit losses is W 22,931 million. The carrying amount of the asset and liability is determined as a reasonable approximation of its fair value.

193

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.3 Details of right-of-use assets and lease liabilities with related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent’s subsidiaries
KB Securities Co., Ltd.	Right-of-use assets		21,927		26,565
	Lease liabilities		26,825		31,814
KB Kookmin Card Co., Ltd.	Right-of-use assets		108		200
	Lease liabilities		29		53
KB Insurance Co., Ltd.	Right-of-use assets		—		3,797
	Lease liabilities		—		3,963
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Right-of-use assets		6,971		9,168
	Lease liabilities		7,021		9,042
Associate of Parent
Star-Lord General Investors Private Real Estate Investment Company No.10	Right-of-use assets		3,563		—
	Lease liabilities		3,707		—

41.4 Notional amount of derivative assets and liabilities arising from transactions with related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent’s subsidiaries
KB Securities Co., Ltd.	Notional amount of derivative financial instruments		2,820,272		2,360,006
KB Life Insurance Co., Ltd.	Notional amount of derivative financial instruments		57,629		163,227
KB Kookmin Card Co., Ltd.	Notional amount of derivative financial instruments		126,730		30,000
KB Insurance Co., Ltd.	Notional amount of derivative financial instruments		2,192,657		1,356,044
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Notional amount of derivative financial instruments		258,928		407,653
KB STAR REIT Co., Ltd.	Notional amount of derivative financial instruments		420,280		—
KB Global Core Bond Securities Feeder Fund(Bond)	Notional amount of derivative financial instruments		—		25,796

194

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.4 Notional amount of derivative assets and liabilities arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB North America Private Real Estate Debt Fund No.1	Notional amount of derivative financial instruments		31,683		29,638
KB North America Private Real Estate Debt Fund No.3	Notional amount of derivative financial instruments		104,552		293,411
KB BMO Senior Loan Private Special Asset Fund No.1(FOF)	Notional amount of derivative financial instruments		38,112		60,822
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *	Notional amount of derivative financial instruments		—		23,941
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *	Notional amount of derivative financial instruments		—		82,985
KB Korea Short Term Premium Private Securities Fund No.25(USD)(Bond)	Notional amount of derivative financial instruments		51,554		—
KB Korea Short Term Premium Private Securities Fund No.26(USD)(Bond)	Notional amount of derivative financial instruments		38,653		—
KB Korea Short Term Premium Private Securities Fund No.27(USD)(Bond)	Notional amount of derivative financial instruments		64,632		—
KB Korea Short Term Premium Private Securities Fund No.32(USD)(Bond)	Notional amount of derivative financial instruments		103,538		—
KB Korea Short Term Premium Private Securities Fund No.33(USD)(Bond)	Notional amount of derivative financial instruments		54,494		—
Hanwha Europe Credit Private Fund No.16 (FOF)	Notional amount of derivative financial instruments		35,081		15,254
KB Aircraft Private Special Asset Fund No.1	Notional amount of derivative financial instruments		123,949		136,328
KB ASF Infra Private Special Asset Fund(FoFs)	Notional amount of derivative financial instruments		6,011		—

* Excluded from the Group’s related party as of December 31, 2022.

195

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.5 Details of significant lending transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

	2022 1
(In millions of Korean won)	Beginning		Loan		Collection		Others			Ending
Parent’s subsidiaries
KB Securities Co., Ltd.		124,527		1,035,932		1,003,576		(14,961	)		141,922
KB Insurance Co., Ltd.		17,958		475		3		(40	)		18,390
KB Kookmin Card Co., Ltd.		71,130		270,676		147,431		3,272			197,647
KB Capital Co., Ltd.		71,130		9,708		41,709		6,063			45,192
KB Star Office Private Real Estate Feeder Fund No.4		20,000		—		—		—			20,000
KB Logistics Blind Private Real Estate Fund No.1		—		52,500		—		—			52,500
Associates
Incheon Bridge Co., Ltd.		151,482		—		18,900		(4,434	)		128,148
Associate of Parent
Star-Lord General Investors Private Real Estate Investment Company No.10		—		150,000		—		(706	)		149,294
Associates of Parent’s subsidiaries
Food Factory Co., Ltd.		3,545		1,500		1,707		(1	)		3,337
COSES GT Co., Ltd.		500		—		—		—			500
Gomi corporation Inc.		2,200		—		—		—			2,200
Desilo Inc.		301		—		—		(1	)		300
Contents First Inc.		—		10,000		—		17			10,017
Key management personnel 2		3,252		1,041		2,038		2,136			4,391

	2021 1
(In millions of Korean won)	Beginning		Loan		Collection		Others			Ending
Parent’s subsidiaries
KB Securities Co., Ltd.		97,803		829,086		807,840		5,478			124,527
KB Insurance Co., Ltd.		—		18,200		300		58			17,958
KB Kookmin Card Co., Ltd.		39,930		86,033		41,551		-13,282			71,130
KB Capital Co., Ltd.		54,400		11,441		—		5,289			71,130
KB Star Office Private Real Estate Feeder Fund No.4		20,000		—		—		—			20,000
Associates
Incheon Bridge Co., Ltd.		171,756		—		18,900		(1,374	)		151,482
Associates of Parent’s subsidiaries
Food Factory Co., Ltd.		3,193		388		37		1			3,545
UPRISE, Inc.		500		—		500		—			—
COSES GT Co., Ltd.		500		—		—		—			500
Gomi corporation Inc.		—		2,200		—		—			2,200
Desilo Inc.		—		300		—		1			301
Key management personnel 2		4,599		2,432		1,752		(2,027	)		3,252

¹ Transactions between related parties, such as settlements arising from operating activities and daylight overdraft to be repaid on the day of handling, are excluded.

²  Includes loan transactions that occurred before they became related parties.

196

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

		2022
(In millions of Korean won)		Beginning		Borrowing		Repayment		Others 1			Ending
Parent
KB Financial Group Inc.	Deposits		518,076		950,000		950,000		(287,020	)		231,056
Parent’s subsidiaries
KB Securities Co., Ltd.	Deposits		535,130		109,580		75,000		293,904			863,614
KB Asset Management Co., Ltd.	Deposits		13,206		—		—		12,744			25,950
KB Real Estate Trust Co., Ltd.	Deposits		103,329		—		—		(54,729	)		48,600
KB Investment Co., Ltd.	Deposits		100,338		195,000		203,000		(11,274	)		81,064
KB Credit Information Co., Ltd.	Deposits		4,536		5,599		1,425		4,720			13,430
KB Data System Co., Ltd.	Deposits		17,999		10,714		12,744		4,955			20,924
KB Life Insurance Co., Ltd.	Deposits		2,608		—		—		(1,820	)		788
KB Kookmin Card Co., Ltd.	Deposits		81,641		22,000		26,742		33,353			110,252
	Borrowings		3,492		22,000		22,000		202			3,694
KB Capital Co., Ltd.	Deposits		219,312		—		—		489,206			708,518
KB Insurance Co., Ltd.	Deposits		7,854		1,537		1,828		57,668			65,231
	Borrowings		23,000		—		—		—			23,000
	Debentures		29,998		—		30,000		2			—
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Deposits		7,634		—		—		145			7,779
	Debentures		30,000		—		—		—			30,000
KB Star Office Private Real Estate Master Fund No.3	Deposits		171		—		171		—			—
KB Star Office Private Real Estate Feeder Fund No.4	Deposits		532		—		318		1			215
KB STAR REIT Co., Ltd.	Deposits		—		—		—		35,053			35,053
Associates
Korea Credit Bureau Co., Ltd.	Deposits		10,200		—		—		17,689			27,889
Incheon Bridge Co., Ltd.	Deposits		35,487		29,217		15,000		(1,065	)		48,639
Jungdo Co., Ltd.	Deposits		4		—		—		—			4
Dae-A Leisure Co., Ltd.	Deposits		17		—		—		137			154
Iwon Alloy Co., Ltd.	Deposits		—		—		—		1			1
Computerlife Co., Ltd.	Deposits		—		—		—		3			3
Skydigital Inc.	Deposits		85		—		—		(75	)		10
Jo Yang Industrial Co., Ltd.	Deposits		1		—		—		(1	)		—
KB High-Tech Company Investment Fund	Deposits		1,504		—		—		(816	)		688
Aju Good Technology Venture Fund	Deposits		6,286		6,577		3,840		(1,801	)		7,222
KB-KDBC Pre-IPO New Technology Business Investment Fund	Deposits		904		—		—		(587	)		317
KB Digital Innovation & Growth New Technology Business Investment Fund	Deposits		2,088		—		—		(1,414	)		674

197

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

		2022
(In millions of Korean won)		Beginning		Borrowing		Repayment		Others 1			Ending
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Deposits		1,524		—		—		2			1,526
KB Global Platform Fund	Deposits		26,823		—		—		(7,168	)		19,655
WJ Private Equity Fund No.1	Deposits		260		—		—		(39	)		221
TMAPMOBILITY CO.,LTD.	Deposits		—		80,000		50,000		—			30,000
KB Bio Global Expansion Private Equity Fund No.1	Deposits		—		1,400		—		—			1,400
KB Global Platform Fund	Deposits		—		59,000		44,000		—			15,000
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 2	Deposits		2,578		—		2,578		—			—
Associates of Parent’s subsidiaries
SY Auto Capital Co., Ltd.	Deposits		17		—		—		(7	)		10
RAND Bio Science Co., Ltd.	Deposits		443		—		—		(440	)		3
Food Factory Co., Ltd.	Deposits		839		511		1,018		332			664
Acts Co., Ltd. 2	Deposits		154		—		—		(154	)		—
Paycoms Co., Ltd.	Deposits		1		—		—		—			1
Big Dipper Co., Ltd.	Deposits		—		300		300		19			19
Spark Biopharma Inc.	Deposits		6,015		41,165		27,539		(2,107	)		17,534
Wyatt Corp.	Deposits		1		—		—		—			1
UPRISE, Inc.	Deposits		4,001		—		—		(3,974	)		27
CellinCells Co., Ltd.	Deposits		38		—		—		(1	)		37
COSES GT Co., Ltd.	Deposits		1,939		—		—		(726	)		1,213
KB No.17 Special Purpose Acquisition Company 2	Deposits		1,687		—		1,546		(141	)		—
KB No.18 Special Purpose Acquisition Company 2	Deposits		2,077		—		2,016		(61	)		—
KB No.19 Special Purpose Acquisition Company 2	Deposits		1,013		—		1,000		(13	)		—
KB No.20 Special Purpose Acquisition Company 2	Deposits		1,681		—		1,534		(147	)		—
KB No.21 Special Purpose Acquisition Company	Deposits		—		2,000		—		263			2,263
KB No.22 Special Purpose Acquisition Company	Deposits		—		—		—		1,948			1,948
KB No.23 Special Purpose Acquisition Company	Deposits		—		2,133		—		72			2,205
SwatchOn Inc. 2	Deposits		686		—		—		(686	)		—
Gomi corporation Inc.	Deposits		3,188		—		—		(2,273	)		915
S&E bio Co., Ltd.	Deposits		263		50		—		6,106			6,419
4N Inc.	Deposits		39		—		—		(34	)		5

198

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

		2022
(In millions of Korean won)		Beginning		Borrowing		Repayment		Others 1			Ending
Contents First Inc.	Deposits		12,650		10,000		16,000		(1,640	)		5,010
December & Company Inc.	Deposits		1		—		—		—			1
GENINUS Inc. 2	Deposits		34,415		—		—		(34,415	)		—
Mantisco Co., Ltd.	Deposits		386		—		—		237			623
Pin Therapeutics Inc.	Deposits		—		21,000		16,200		1,233			6,033
G1 Playground Co., Ltd.	Deposits		354		—		—		(354	)		—
SuperNGine Co., Ltd.	Deposits		944		—		—		(927	)		17
Desilo Inc.	Deposits		168		—		—		(167	)		1
Turing Co., Ltd.	Deposits		1,054		—		—		1,734			2,788
IGGYMOB Co., Ltd.	Deposits		2,938		—		—		(2,684	)		254
KB Pre IPO Secondary Venture Fund No.1 2	Deposits		103		—		—		(103	)		—
ZIPDOC Inc.	Deposits		—		—		—		915			915
TeamSparta Inc.	Deposits		—		9,000		4,000		7,502			12,502
Chabot Mobility Co., Ltd.	Deposits		—		—		—		86			86
Wemade Connect Co., Ltd.	Deposits		—		11,010		3,267		2,627			10,370
Wise Asset Management Co., Ltd	Deposits		—		6		6		—			—
Channel Corporation	Deposits		—		6,000		3,000		—			3,000
KB No.24 Special Purpose Acquisition Company Co., Ltd.	Deposits		—		—		—		9,983			9,983
Nextrade Co., Ltd.	Deposits		—		56,200		—		2			56,202
Key management personnel 3	Deposits		11,757		14,214		12,345		(1,652	)		11,974

199

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

		2021
(In millions of Korean won)		Beginning		Borrowing		Repayment		Others 1			Ending
Parent
KB Financial Group Inc.	Deposits		23,084		200,000		200,000		494,992			518,076
Parent’s subsidiaries
KB Securities Co., Ltd.	Deposits		464,584		75,000		157,117		152,663			535,130
KB Asset Management Co., Ltd.	Deposits		6,915		—		—		6,291			13,206
KB Real Estate Trust Co., Ltd.	Deposits		71,261		—		—		32,068			103,329
KB Investment Co., Ltd.	Deposits		93,970		236,000		234,000		4,368			100,338
KB Credit Information Co., Ltd.	Deposits		5,340		2,231		2,025		(1,010	)		4,536
KB Data System Co., Ltd.	Deposits		17,561		11,744		12,500		1,194			17,999
KB Life Insurance Co., Ltd.	Deposits		2,085		—		—		523			2,608
KB Kookmin Card Co., Ltd.	Deposits		92,490		27,574		25,500		(12,923	)		81,641
	Borrowings		—		3,492		—		—			3,492
KB Capital Co., Ltd.	Deposits		190,331		—		—		28,981			219,312
KB Insurance Co., Ltd.	Deposits		3,365		3,266		—		1,223			7,854
	Borrowings		—		23,000		—		—			23,000
	Debentures		29,994		—		—		4			29,998
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Deposits		303		—		—		7,331			7,634
	Debentures		30,000		—		—		—			30,000
KB Star Office Private Real Estate Master Fund No.3	Deposits		171		—		—		—			171
KB Star Office Private Real Estate Feeder Fund No.4	Deposits		532		—		—		—			532
Associates
Korea Credit Bureau Co., Ltd.	Deposits		19,982		—		1,000		(8,782	)		10,200
Incheon Bridge Co., Ltd.	Deposits		39,520		15,000		20,000		967			35,487
Jungdo Co., Ltd.	Deposits		4		—		—		—			4
Dae-A Leisure Co., Ltd.	Deposits		636		—		479		(140	)		17
Skydigital Inc.	Deposits		15		—		—		70			85
Jo Yang Industrial Co., Ltd.	Deposits		2		—		—		(1	)		1
KB High-Tech Company Investment Fund	Deposits		12,695		—		—		(11,191	)		1,504
Aju Good Technology Venture Fund	Deposits		3,093		3,840		1,442		795			6,286
KB-KDBC Pre-IPO New Technology Business Investment Fund	Deposits		923		—		—		(19	)		904
KB Digital Innovation & Growth New Technology Business Investment Fund	Deposits		1,801		—		—		287			2,088
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Deposits		8,097		—		—		(6,573	)		1,524
KB Global Platform Fund	Deposits		20,197		—		—		6,626			26,823
Neomio Corp. 2	Deposits		535		—		—		(535	)		—
WJ Private Equity Fund No.1	Deposits		349		—		—		(89	)		260

200

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

		2021
(In millions of Korean won)		Beginning		Borrowing		Repayment		Others 1			Ending
Associate of Parent							—
KB Star Office Private Real Estate Investment Trust No.1 2	Deposits		4,255		—		1,770		93			2,578
Associates of Parent’s subsidiaries
SY Auto Capital Co., Ltd.	Deposits		6		—		—		11			17
KB No.17 Special Purpose Acquisition Company2	Deposits		1,711		1,546		1,525		(45	)		1,687
KB No.18 Special Purpose Acquisition Company2	Deposits		2,101		2,016		2,063		23			2,077
KB No.19 Special Purpose Acquisition Company2	Deposits		1,053		1,000		1,000		(40	)		1,013
KB No.20 Special Purpose Acquisition Company2	Deposits		1,716		1,534		1,522		(47	)		1,681
RAND Bio Science Co., Ltd.	Deposits		693		—		400		150			443
Food Factory Co., Ltd.	Deposits		1,555		507		500		(723	)		839
Acts Co., Ltd. 2	Deposits		18		—		—		136			154
Paycoms Co., Ltd.	Deposits		1		—		—		—			1
Big Dipper Co., Ltd.	Deposits		1		—		—		(1	)		—
Wyatt Corp.	Deposits		1		—		—		—			1
Stratio, Inc.	Deposits		13		—		—		(13	)		—
UPRISE, Inc.	Deposits		11		—		—		3,990			4,001
CellinCells Co., Ltd.	Deposits		260		—		—		(222	)		38
COSES GT Co., Ltd.	Deposits		292		—		—		1,647			1,939
SwatchOn Inc. 2	Deposits		3,947		200		3,501		40			686
Gomi corporation Inc.	Deposits		37		—		—		3,151			3,188
S&E bio Co., Ltd.	Deposits		1,142		—		—		(879	)		263
KB Pre IPO Secondary Venture Fund No.12	Deposits		629		—		—		(526	)		103
4N Inc.	Deposits		76		—		—		(37	)		39
Contents First Inc.	Deposits		1,823		20,000		11,000		1,827			12,650
December & Company Inc.	Deposits		1		—		—		—			1
GENINUS Inc. 2	Deposits		13,630		—		5,000		25,785			34,415
Mantisco Co., Ltd.	Deposits		—		—		—		386			386
Spark Biopharma Inc.	Deposits		—		1,000		3,000		8,015			6,015
G1 Playground Co., Ltd.	Deposits		—		—		—		354			354
SuperNGine Co., Ltd.	Deposits		—		—		—		944			944
Desilo Inc.	Deposits		—		—		—		168			168
Turing Co., Ltd.	Deposits		—		—		—		1,054			1,054
IGGYMOB Co., Ltd.	Deposits		—		—		—		2,938			2,938
Key management personnel 3	Deposits		11,023		9,974		9,568		328			11,757

¹ Transactions between related parties, such as settlements arising from operating activities and deposits, are expressed in net amount.

²  Excluded from the Group’s related party as of December 31, 2022.

³ Includes borrowing transactions that occurred before they became related parties.

201

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Equity investment and others		Withdrawal and others
Parent’s subsidiaries
KB Hanbando BTL Private Special Asset Fund No.1		—		19,510
KB Hope Sharing BTL Private Special Asset Fund		—		1,416
KB Intellectual Property Fund		—		180
KB Star Office Private Real Estate Master Fund No.3		—		3,276
KB Star Office Private Real Estate Feeder Fund No.4		—		2,412
KB Global Core Bond Securities Feeder Fund(Bond)		—		42,737
KB New Renewable Energy Private Special Asset Fund No.1		3,492		1,794
KB Mezzanine Private Securities Fund No.3		—		16,240
KB Wise Star Jongno Tower Real Estate Master Fund *		—		112,639
Koreit BN Private Equity Fund		—		2,440
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)		2,452		2,746
KB BMO Senior Loan Private Special Asset Fund No.2(USD)		—		2,092
KB Korea Short Term Premium Private Securities No.19(USD)(Bond) *		—		23,985
KB Korea Short Term Premium Private Securities No.21(USD)(Bond) *		—		36,102
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *		—		24,433
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *		—		85,433
KB Korea Short Term Premium Private Securities Fund No.25(USD)(Bond)		47,672		—
KB Korea Short Term Premium Private Securities Fund No.26(USD)(Bond)		35,910		—
KB Korea Short Term Premium Private Securities Fund No.27(USD)(Bond)		59,980		—
KB Korea Short Term Premium Private Securities Fund No.28(USD)(Bond) *		95,368		108,180
KB Sinansan Line Private Special Asset Fund(SOC)		31,808		2,490
KB New Renewable Green New Deal Private Special Asset No.2		22,350		1,447
KB Multi Alpha Plus Private Fund No.1		—		400
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)		20,703		1,959
KB New Deal Infra Private Special Asset Fund		10,199		77
KB Logistics Blind Private Real Estate Fund No.1		25,812		1,463
KB Star ESG Prime Mid-Short Bond Securities Feeder Fund(Bond)		50,000		48,800
KB GK Project Private Special Asset Fund No.3		—		89,410
KB BMO Senior Loan Private Special Asset Fund No.4(USD)		38,828		404
KB Core Blind Private Real Estate Fund No.2		5,107		—
KB Star Reits Private Real Estate Feeder Fund No.2		65,000		—
KB KBSTAR US Short-Term IG Corporate Bond ETF		20,000		—
KB Korea Short Term Premium Private Securities Fund No.32		107,312		—
KB KBSTAR Nov 2023 Term Credit ETF		180,581		—
KB Korea Short Term Premium Private Securities Fund No.33(USD)(Bond)		52,816		—
KB Korea Short Term Premium Private Securities Fund No.34(USD)(Bond)		63,420		—

202

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2022
(In millions of Korean won)	Equity investment and others		Withdrawal and others
Associates
Future Planning KB Start-up Creation Fund		—		1,700
KB High-Tech Company Investment Fund		—		1,300
Aju Good Technology Venture Fund		—		5,400
KB-KDBC Pre-IPO New Technology Business Investment Fund		—		2,600
KB-TS Technology Venture Private Equity Fund		—		2,430
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		—		6,400
KB SPROTT Renewable Private Equity Fund No.1		9,748		—
KB Global Platform Fund		8,000		6,150
KB Smart Scale Up Fund		12,000		—
KB-KTB Technology Venture Fund		6,000		—
KB Digital Platform Fund		14,000		—
KB-SOLIDUS Healthcare Investment Fund		6,000		—
KB New Deal Innovation Fund		9,600		—
TMAPMOBILITY CO.,LTD.		200,000		—
KB Prime Digital Platform Fund		2,600		—
KB Scale Up Fund II		4,500		—
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 *		—		42,118
Balhae Infrastructure Company		—		21,177
Associate of Parent’s subsidiaries
KB-Stonebridge Secondary Private Equity Fund		2,497		2,409
KB-NAU Special Situation Corporate Restructuring Private Equity Fund		440		2,044
KB Co-Investment Private Equity Fund No.1		6,320		—
KB-NP Green ESG New Technology Venture Capital Fund		2,805		—

203

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021
(In millions of Korean won)	Equity investment and others		Withdrawal and others
Parent’s subsidiaries
PT KB DATA SYSTEMS INDONESIA		145		—
KB Hanbando BTL Private Special Asset Fund No.1		—		20,448
KB Hope Sharing BTL Private Special Asset Fund		—		1,647
KB Intellectual Property Fund		—		476
KB Senior Loan Private Fund No.1 *		—		5,844
KB Star Office Private Real Estate Master Fund No.3		—		3,569
KB Star Office Private Real Estate Feeder Fund No.4		—		2,474
KB Global Core Bond Securities Feeder Fund(Bond)		—		22,134
KB New Renewable Energy Private Special Asset Fund No.1		—		1,793
KB Mezzanine Private Securities Fund No.3		22,235		42,562
KB Wise Star Jongno Tower Real Estate Master Fund *		—		2,093
Koreit BN Private Equity Fund		—		898
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)		1,896		—
KB BMO Senior Loan Private Special Asset Fund No.2(USD)		6,727		1,657
KB Korea Short Term Premium Private Securities No.15(USD)(Bond) *		—		23,660
KB Korea Short Term Premium Private Securities No.17(USD)(Bond) *		—		71,240
KB Korea Short Term Premium Private Securities No.19(USD)(Bond) *		22,088		—
KB Korea Short Term Premium Private Securities No.21(USD)(Bond) *		33,213		—
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *		22,556		—
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *		71,112		—
KB Sinansan Line Private Special Asset Fund(SOC)		29,156		2,757
KB New Renewable Green New Deal Private Special Asset No.2		12,349		124
KB Multi Alpha Plus Private Fund No.1		10,000		—
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)		33,147		—
KB New Deal Infra Private Special Asset Fund		408		—
KB Logistics Blind Private Real Estate Fund No.1		31,111		1
KB Star ESG Prime Mid-Short Bond Securities Feeder Fund(Bond)		49,000		—
KB Global Commerce Private Equity Investment Fund		7,000		—

204

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

	2021
(In millions of Korean won)	Equity investment and others		Withdrawal and others
Associates
Korea Credit Bureau Co., Ltd.		—		90
Balhae Infrastructure Company		279		9,584
KB GwS Private Securities Investment Trust *		—		147,785
KoFC POSCO Hanwha KB Shared Growth Private Equity Fund No.2 *		—		9,488
Future Planning KB Start-up Creation Fund		—		2,800
KB High-Tech Company Investment Fund		—		11,450
Aju Good Technology Venture Fund		—		4,769
KB-KDBC Pre-IPO New Technology Business Investment Fund		—		2,400
KB-TS Technology Venture Private Equity Fund		1,650		2,880
KB Digital Innovation & Growth New Technology Business Investment Fund		1,125		—
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		5,000		5,400
KB Global Platform Fund		13,500		—
KB-UTC Inno-Tech Venture Fund		3,390		750
KB Pre-IPO New Technology Business Investment Fund No.2		7,500		—
KB Smart Scale Up Fund		27,000		—
KB Bio Global Expansion Private Equity Fund No.1		10,000		—
KB-KTB Technology Venture Fund		3,000		—
KB Digital Platform Fund		12,600		—
KB-SOLIDUS Healthcare Investment Fund		600		—
KB New Deal Innovation Fund		4,000		—
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 *		—		1,246
Associate of Parent’s subsidiaries
KB-Stonebridge Secondary Private Equity Fund		7,576		9,039
KB-NAU Special Situation Corporate Restructuring Private Equity Fund		2,564		—

* Excluded from the Group’s related party as of December 31, 2022.

205

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.8 Acceptances and guarantees and unused commitments provided to related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent’s subsidiaries
KB Securities Co., Ltd.	Loan commitments in Korean won		140,000		140,000
KB Investment Co., Ltd.	Loss sharing agreements		1,000		1,000
KB Life Insurance Co., Ltd.	Loan commitments in Korean won		100,000		—
KB Kookmin Card Co., Ltd.	Loan commitments in Korean won		820,000		820,000
	Other commitments in Korean won		1,700,000		1,300,000
	Other commitments in foreign currency		44,515		—
KB Capital Co., Ltd.	Other commitments in foreign currency		40,381		13,041
KB Insurance Co., Ltd.	Loan commitments in Korean won		20,528		21,000
KB New Renewable Energy Private Special Asset Fund No.1	Purchase of securities		3,010		6,502
KB Mezzanine Private Securities Fund No.3	Purchase of securities		8,006		8,006
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)	Purchase of securities		1,968		4,343
KB Global Infra Private Special Asset Fund No.5	Purchase of securities		24,999		24,999
KB Global Infra Private Special Asset Fund No.6	Purchase of securities		24,999		24,999
KB BMO Senior Loan Private Special Asset Fund No.2(USD)	Purchase of securities		29		27
KB New Renewable Green New Deal Private Special Asset No.2	Purchase of securities		5,301		27,651
KB Sinansan Line Private Special Asset Fund(SOC)	Purchase of securities		200,988		232,796
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)	Purchase of securities		3,554		14,287
KB New Deal Infra Private Special Asset Fund	Purchase of securities		7,492		17,692
KB Logistics Blind Private Real Estate Fund No.1	Purchase of securities		—		68,889
KB GK Project Private Special Asset Fund No.3	Purchase of securities		23		29
KB Core Blind Private Real Estate Fund No.2	Purchase of securities		94,893		—

206

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.8 Acceptances and guarantees and unused commitments provided to related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
Associates
Incheon Bridge Co., Ltd.	Loan commitments in Korean won		20,000		20,000
KB-TS Technology Venture Private Equity Fund	Purchase of securities		—		330
KB SPROTT Renewable Private Equity Fund No.1	Purchase of securities		5,140		14,887
KB Global Platform Fund	Purchase of securities		—		8,000
All Together Korea Fund No.2	Purchase of securities		990,000		—
KB Smart Scale Up Fund	Purchase of securities		7,000		19,000
KB Scale Up Fund II	Purchase of securities		25,500		—
KB-KTB Technology Venture Fund	Purchase of securities		6,000		12,000
KB Digital Platform Fund	Purchase of securities		113,400		127,400
KB-SOLIDUS Healthcare Investment Fund	Purchase of securities		23,400		29,400
KB New Deal Innovation Fund	Purchase of securities		6,400		16,000
KB Prime Digital Platform Fund	Purchase of securities		10,400		—
Associates of Parent Company
Balhae Infrastructure Company	Purchase of securities		6,154		6,154
Associates of Parent’s subsidiaries
KB-Stonebridge Secondary Private Equity Fund	Purchase of securities		691		3,188
KB-NAU Special Situation Corporate Restructuring Private Equity Fund	Purchase of securities		5,096		5,536
KB Co-Investment Private Equity Fund No.1	Purchase of securities		13,680		20,000
KB-Badgers Future Mobility ESG Fund No.1	Purchase of securities		19,050		—
KB-NP Green ESG New Technology Venture Capital Fund	Purchase of securities		12,195		—
Key management personnel	Loan commitments in Korean won		833		808

41.9 Acceptances and guarantees and unused commitments provided by related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent’s subsidiaries
KB Investment Co., Ltd.	Loss sharing agreements		7,008		7,561
KB Real Estate Trust Co., Ltd.	Purchase of securities		19		19
KB Securities Co., Ltd.	Purchase of securities		19		19
KB Life Insurance Co., Ltd.	Purchase of securities		95		104
KB Insurance Co., Ltd.	Purchase of securities		—		9
KB Asset Management Co., Ltd.	Purchase of securities		—		2
KB Kookmin Card Co., Ltd.	Loan commitment in Korean won		82,354		88,283

207

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.10 Details of compensation to key management personnel for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Short-term employee benefits		Post- employment benefits		Share-based payments		Total
Registered directors (executive)		1,963		44		1,034		3,041
Registered directors (non-executive)		420		—		—		420
Non-registered directors		9,801		344		7,563		17,708
		12,184		388		8,597		21,169

	2021
(In millions of Korean won)	Short-term employee benefits		Post- employment benefits		Share-based payments		Total
Registered directors (executive)		1,898		84		2,670		4,652
Registered directors (non-executive)		395		—		—		395
Non-registered directors		7,042		405		7,131		14,578
		9,335		489		9,801		19,625

41.11 Major types of transactions between the Group and the related parties include deposit taking transactions, loan transactions such as general purpose loans, corporate purchase loans, B2B loans, etc., settlements of funds arising from overseas remittance, providing credit line through the acceptance of letter of credit issued by the Bank, and overdraft accounts arising from net settlement agreement between the Bank and KB Kookmin Card Co., Ltd.

41.12 Details of collateral provided to related parties as of December 31, 2022 and 2021, are as follows:

			December 31, 2022				December 31, 2021
(In millions of Korean won)	Assets pledged *		Carrying amount		Collateralized amount		Carrying amount		Collateralized amount
Parent’s subsidiaries
KB Securities Co., Ltd.		Securities		62,209		62,000		54,143		54,000
KB Life Insurance Co., Ltd.		Securities		25,425		25,000		25,813		25,000
KB Insurance Co., Ltd.		Securities		47,745		50,000		49,982		50,000

* Collaterals related to lease contracts arising from operating activities between related parties are excluded.

208

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

41.13 Details of collateral provided by related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Assets held as collateral 1	December 31, 2022		December 31, 2021
Parent’s subsidiaries
KB Securities Co., Ltd.	Time deposits /Beneficiary right certificate		167,000		167,000
	Securities		129,196		25,135
	Real estate 2		—		12,000
KB Life Insurance Co., Ltd.	Securities		120,000		10,000
KB Kookmin Card Co., Ltd.	Time deposits		22,000		22,000
KB Insurance Co., Ltd.	Securities		250,000		90,000
	Real estate		24,570		24,570
KB Credit Information Co., Ltd.	Time deposits and others		2,228		2,054
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Securities		18,159		20,008
KB Star Office Private Real Estate Feeder Fund No.4	Real estate		24,000		24,000
KB Logistics Blind Private Real Estate Fund No.1	Real estate		63,000		—
Key management personnel	Time deposits and others		457		745
	Real estate		5,165		3,818

¹  Collaterals related to lease contracts arising from operating activities between related parties are excluded.

²  Related to KB Wise Star Jongno Tower Real Estate Master Fund, a subsidiary of KB Securities Co., Ltd.

As of December 31, 2022, Incheon Bridge Co., Ltd., a related party, provides fund management account, civil engineering works insurance, and management and operations rights as senior collateral amounting to W 611,000 million to the project financing group consisting of the Bank and 5 other institutions, and as subordinated collateral amounting to W 384,800 million to subordinated debt holders consisting of the Bank and 2 other institutions. Also, it provides certificate of credit guarantee amounting to W 400,000 million as collateral to the project financing group consisting of the Bank and 5 other institutions.

41.14 The amounts of debt securities and others purchased through KB securities Co., Ltd. are W 7,341,904 million and W 9,642,170 million for the years ended December 31, 2022 and 2021, respectively, and the amounts of debt securities and others sold through KB securities Co., Ltd. are W 3,791,778 million and W 9,005,607 million for the years ended December 31, 2022 and 2021, respectively. In addition, KB Securities Co., Ltd. acquired W 50,000 million and W 185,000 million of debentures issued by the Bank through underwriting for the years ended December 31, 2022 and 2021, respectively.

41.15 The amounts of intangible assets and others purchased from KB Data System Co., Ltd. are W 42,947 million and W 24,420 million for the years ended December 31, 2022 and 2021, respectively.

41.16 The Bank has entered into CLS (Continuous Linked Settlement) service agreement with KB Securities Co., Ltd. and accordingly the Bank is able to provide intraday liquidity of USD 500 million on the condition of repayment on the day of payment.

41.17 The Bank and KB Kookmin Card Co., Ltd. are jointly and severally liable for the liabilities of the Bank before the spin-off date.

209

Kookmin Bank and Subsidiaries

Notes to the Consolidated Financial Statements

December 31, 2022 and 2021

42. Approval of Issuance of the Consolidated Financial Statements

The issuance of the Group’s consolidated financial statements as of and for the year ended December 31, 2022, was approved by the board of directors on February 6, 2023.

210

Exhibit 99.2

Kookmin Bank

(A wholly owned subsidiary of KB Financial Group Inc.)

Separate Financial Statements

December 31, 2022 and 2021

(With Independent Auditors’ Report Thereon)

Contents

	Page
Independent Auditors’ Report		1
Separate Statements of Financial Position		3
Separate Statements of Comprehensive Income		4
Separate Statements of Changes in Equity		5
Separate Statements of Cash Flows		6
Notes to the Separate Financial Statements		7
Independent Auditors’ Review Report on Internal Control over Financial Reporting		209
Operating Status Report of the Internal Control over Financial Reporting		210

Independent Auditors’ Report

Based on a report originally issued in Korean

To the Shareholder and Board of Directors

Kookmin Bank

Opinion

We have audited the separate financial statements of Kookmin Bank (“The Bank”), which comprise the statements of financial position as of December 31, 2022 and 2021, the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.

In our opinion, the accompanying separate financial statements present fairly, in all material respects, the financial position of the Bank as of December 31, 2022 and 2021, and its financial performance and its cash flows for the year then ended in accordance with Korean International Financial Reporting Standards (“K-IFRS”).

Basis for Opinion

We conducted our audits in accordance with Korean Standards on Auditing (KSAs). Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Separate Financial Statements section of our report. We are independent of the Bank in accordance with the ethical requirements that are relevant to our audit of the separate financial statements in the Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management and Those Charged with Governance for the Separate Financial Statements

Management is responsible for the preparation and fair presentation of the separate financial statements in accordance with K-IFRS, and for such internal control as management determines is necessary to enable the preparation of separate financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the separate financial statements, management is responsible for assessing the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Bank’s financial reporting process.

1

Auditors’ Responsibilities for the Audit of the Separate Financial Statements

Our objectives are to obtain reasonable assurance about whether the separate financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these separate financial statements.

As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the separate financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Bank’s internal control.

• Evaluate the appropriateness of accounting policies used in the preparation of the separate financial statements and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the separate financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Bank to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the separate financial statements, including the disclosures, and whether the separate financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

/s/ KPMG Samjong Accounting Corp.

Seoul, Korea

March 7, 2023

This report is effective as of March 7, 2023, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying separate financial statements and notes thereto. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

2

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Separate Statements of Financial Position

December 31, 2022 and 2021

(In millions of Korean won)	Notes	December 31, 2022			December 31, 2021
Assets
Cash and due from financial institutions	2,4,6,7,36	W	22,296,244		W	22,368,904
Financial assets at fair value through profit or loss	4,6,8,12		18,154,550			14,782,128
Derivative financial assets	4,6,9		7,747,794			2,960,174
Loans measured at amortized cost	4,6,8,10,11		363,839,085			349,438,762
Financial investments	4,6,8,12		74,026,021			62,584,129
Investments in associates and subsidiaries	13,38		2,747,295			2,964,238
Property and equipment	14		3,529,134			3,606,188
Investment property	14		119,323			97,651
Intangible assets	15		493,279			472,253
Net defined benefit assets	23		307,749			0
Current income tax assets	32		187,017			51,191
Assets held for sale	17		30,971			44,159
Other assets	4,6,18		6,865,013			5,403,620
Total assets		W	500,343,475		W	464,773,397
Liabilities
Financial liabilities at fair value through profit or loss	4,6	W	108,862		W	112,698
Derivative financial liabilities	4,6,9		7,294,787			2,740,904
Deposits	4,6,19		368,100,984			349,615,372
Borrowings	4,6,20		43,664,670			31,073,908
Debentures	4,6,21		27,999,416			26,891,141
Provisions	22		494,238			421,792
Net defined benefit liabilities	23		451			138,505
Current income tax liabilities	32		5,671			5,696
Deferred income tax liabilities	16,32		105,436			640,082
Other liabilities	4,6,24,30		19,015,179			20,515,698
Total liabilities			466,789,694			432,155,796
Equity
Capital stock	25		2,021,896			2,021,896
Hybrid securities	25		873,850			574,523
Capital surplus	25		5,220,031			5,220,031
Accumulated other comprehensive income	25,34		(86,385	)		1,362,438
Retained earnings	25,33,34		25,524,389			23,438,713
(Provision of regulatory reserve for credit losses
December 31, 2022 : W 2,715,060 million
December 31, 2021 : W 2,434,041 million)
(Amounts estimated to be appropriated
December 31, 2022 : W 70,905 million
December 31, 2021 : W 281,019 million)
Total equity			33,553,781			32,617,601
Total liabilities and equity		W	500,343,475		W	464,773,397

The above separate statements of financial position should be read in conjunction with the accompanying notes.

3

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Separate Statements of Comprehensive Income

Years Ended December 31, 2022 and 2021

(In millions of Korean won)	Notes	2022			2021
Interest income		W	13,962,022		W	9,490,842
Interest income from financial instruments at fair value through other comprehensive income and amortized cost			13,764,254			9,416,081
Interest income from financial instruments at fair value through profit or loss			197,768			74,761
Interest expense			(5,402,820	)		(2,359,527	)
Net interest income	26		8,559,202			7,131,315
Fee and commission income			1,512,230			1,572,185
Fee and commission expense			(411,404	)		(383,553	)
Net fee and commission income	27		1,100,826			1,188,632
Net gains on financial instruments at fair value through profit or loss	28		354,180			352,958
Net other operating expenses	29		(929,600	)		(818,957	)
General and administrative expenses	14,15,23,30,39		(4,294,337	)		(4,007,668	)
Operating income before provision for credit losses			4,790,271			3,846,280
Provision for credit losses	7,11,12,18,22		(461,350	)		(356,563	)
Net operating income			4,328,921			3,489,717
Net non-operating income (expenses)	31		(372,517	)		5,395
Profit before income tax expense			3,956,404			3,495,112
Income tax expense	32		(1,048,184	)		(931,754	)
Profit for the period			2,908,220			2,563,358
(Adjusted profit after provision of regulatory reserve for credit losses	25
December 31, 2022 : W 2,837,315 million
December 31, 2021 : W 2,282,339 million)
Items that will not be reclassified to profit or loss:
Remeasurements of net defined benefit liabilities	23		177,890			(72,946	)
Gains (losses) on equity securities at fair value through other comprehensive income			(953,990	)		873,707
Items that may be subsequently reclassified to profit or loss:
Currency translation differences			(2,022	)		3,957
Losses on debt securities at fair value through other comprehensive income			(461,689	)		(278,186	)
Gains on cash flow hedging instruments	9		34,010			9,984
Other comprehensive income (loss) for the period, net of tax	34		(1,205,801	)		536,516
Total comprehensive income for the period		W	1,702,419		W	3,099,874

The above separate statements of comprehensive income should be read in conjunction with the accompanying notes.

4

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Separate Statements of Changes in Equity

Years Ended December 31, 2022 and 2021

(In millions of Korean won)	Capital stock		Hybrid securities		Capital surplus		Accumulated other comprehensive income			Retained earnings			Total equity
Balance as of January 1, 2021	W	2,021,896	W	574,523	W	5,220,031	W	594,413		W	22,048,949		W	30,459,812
Comprehensive income for the period
Profit for the period		—		—		—		—			2,563,358			2,563,358
Remeasurements of net defined benefit liabilities		—		—		—		(72,946	)		—			(72,946	)
Gains (losses) on equity securities at fair value through other comprehensive income		—		—		—		1,105,216			(231,509	)		873,707
Currency translation differences		—		—		—		3,957			—			3,957
Losses on debt securities at fair value through other comprehensive income		—		—		—		(278,186	)		—			(278,186	)
Gains on cash flow hedging instruments		—		—		—		9,984			—			9,984
Total comprehensive income for the period		—		—		—		768,025			2,331,849			3,099,874
Transactions with the shareholder
Dividends		—		—		—		—			(917,941	)		(917,941	)
Dividends on hybrid securities		—		—		—		—			(24,144	)		(24,144	)
Total transactions with the shareholder		—		—		—		—			(942,085	)		(942,085	)
Balance as of December 31, 2021	W	2,021,896	W	574,523	W	5,220,031	W	1,362,438		W	23,438,713		W	32,617,601
Balance as of January 1, 2022	W	2,021,896	W	574,523	W	5,220,031	W	1,362,438		W	23,438,713		W	32,617,601
Comprehensive income for the period
Profit for the period		—		—		—		—			2,908,220			2,908,220
Remeasurements of net defined benefit liabilities		—		—		—		177,890			—			177,890
Gains (losses) on equity securities at fair value through other comprehensive income		—		—		—		(1,197,012	)		243,022			(953,990	)
Currency translation differences		—		—		—		(2,022	)		—			(2,022	)
Losses on debt securities at fair value through other comprehensive income		—		—		—		(461,689	)		—			(461,689	)
Gains on cash flow hedging instruments		—		—		—		34,010			—			34,010
Total comprehensive income for the period		—		—		—		(1,448,823	)		3,151,242			1,702,419
Transactions with the shareholder
Dividends		—		—		—		—			(1,031,167	)		(1,031,167	)
Issuance of hybrid securities		—		299,327		—		—			—			299,327
Dividends on hybrid securities		—		—		—		—			(34,399	)		(34,399	)
Total transactions with the shareholder		—		299,327		—		—			(1,065,566	)		(766,239	)
Balance as of December 31, 2022	W	2,021,896	W	873,850	W	5,220,031	W	(86,385	)	W	25,524,389		W	33,553,781

The above separate statements of changes in equity should be read in conjunction with the accompanying notes.

5

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Separate Statements of Cash Flows

Years Ended December 31, 2022 and 2021

(in millions of Korean won)	Notes	2022			2021
Cash flows from operating activities
Profit for the period		W	2,908,220		W	2,563,358
Adjustment for non-cash items
Net gains on financial instruments at fair value through profit or loss			(117,361	)		(177,546	)
Net losses (gains) on derivative financial investments for hedging purposes			(28,984	)		13,132
Provision for credit losses			461,348			356,845
Net losses on financial investments			20,230			3,524
Losses (gains) on associates and subsidiaries			358,195			(58,661	)
Depreciation and amortization expense			510,059			503,939
Other net losses (gains) on property and equipment/intangible assets			(40,824	)		11,493
Share-based payment			15,169			27,995
Post-employment benefits			166,670			156,340
Net interest income			167,910			449,005
Losses on foreign currency translation			340,123			15,571
Other expenses			68,788			22,309
			1,921,323			1,323,946
Changes in operating assets and liabilities
Financial assets at fair value through profit or loss			(1,982,538	)		(1,635,278	)
Derivative financial instrument			184,288			123,501
Loans measured at amortized cost			(13,434,569	)		(30,960,817	)
Current income tax assets			(122,778	)		(1,856	)
Deffered income tax assets			—			160
Other assets	2,36		(1,301,903	)		908,254
Financial liabilities at fair value through profit or loss			(11,865	)		(34,192	)
Deposits			17,791,562			29,270,074
Deferred income tax liabilities			(77,560	)		115,357
Other liabilities			(1,706,320	)		3,300,650
			(661,683	)		1,085,853
Net cash inflow from operating activities			4,167,860			4,973,157
Cash flows from investing activities
Net cash flows from derivative financial instrument for hedging purposes			(3,446	)		(1,414	)
Disposal of financial assets at fair value through profit or loss			8,584,309			6,823,184
Acquisition of financial assets at fair value through profit or loss			(9,904,210	)		(7,512,552	)
Disposal of financial investments			17,547,994			42,078,221
Acquisition of financial investments			(31,557,734	)		(46,260,973	)
Disposal of investments in associates and subsidiaries			32,334			178,338
Acquisition of investments in associates and subsidiaries			(272,448	)		(865,083	)
Disposal of property and equipment			11,819			(1,298	)
Acquisition of property and equipment			(177,608	)		(168,197	)
Disposal of intangible assets			245			1,834
Acquisition of intangible assets			(64,579	)		(82,209	)
Others			19,545			(17,397	)
Net cash outflow from investing activities			(15,783,779	)		(5,827,546	)
Cash flows from financing activities
Net cash flows from derivative financial instrument for hedging purposes			33,287			5,870
Increase in borrowings			12,013,037			5,338,985
Increase in debentures			16,118,240			12,447,222
Decrease in debentures			(15,190,127	)		(10,607,722	)
Payment of dividends			(1,031,167	)		(917,941	)
decrease in other payables to trust accounts			(877,097	)		(511,379	)
Issuance of hybrid securities			299,327			—
Others			522,076			(261,499	)
Net cash inflow from financing activities			11,887,576			5,493,536
Effect of exchange rate changes on cash and cash equivalents	2,36		(150,554	)		258,712
Net increase in cash and cash equivalents			121,103			4,897,859
Cash and cash equivalents at the beginning of the period	2,36		21,872,041			16,974,182
Cash and cash equivalents at the end of the period	2,36	W	21,993,144		W	21,872,041

The above separate statements of cash flows should be read in conjunction with the accompanying notes.

6

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

1. The Bank

Kookmin Bank (the “Bank”) was incorporated in 1963 under the Citizens National Bank Act to provide banking services to the general public and to small and medium-sized enterprises. Pursuant to the Repeal Act of the Citizens National Bank Act, effective January 5, 1995, the Bank’s status changed to a financial institution which operates under the Banking Act and Commercial Act.

The Bank merged with Korea Long Term Credit Bank on December 31, 1998, and with its subsidiaries, Daegu, Busan, Jeonnam Kookmin Mutual Savings & Finance Co., Ltd., on August 22, 1999. Pursuant to the directive from the Financial Services Commission related to the Structural Improvement of the Financial Industry Act, the Bank acquired certain assets, including performing loans, and assumed most of the liabilities of Daedong Bank on June 29, 1998. Also, the Bank completed the merger with Housing and Commercial Bank (“H&CB”) on October 31, 2001, and merged with Kookmin Credit Card Co., Ltd., a majority-owned subsidiary, on September 30, 2003. Meanwhile, the Bank spun off its credit card business segment on February 28, 2011, and KB Kookmin Card Co., Ltd. became a subsidiary of KB Financial Group Inc.

The Bank listed its shares on the Stock Market Division of the Korea Exchange (“KRX”) in September 1994. As a result of the merger with H&CB, the shareholders of the former Kookmin Bank and H&CB received new common shares of the Bank which were relisted on the KRX on November 9, 2001. In addition, H&CB listed its American Depositary Shares (“ADS”) on the New York Stock Exchange (“NYSE”) on October 3, 2000, prior to the merger. Following the merger with H&CB, the Bank listed its ADS on the NYSE on November 1, 2001. The Bank became a wholly owned subsidiary of KB Financial Group Inc. through a comprehensive stock transfer on September 29, 2008. Subsequently, the Bank’s shares and its ADS, each listed on the KRX and the NYSE, were delisted on October 10, 2008 and September 26, 2008, respectively. As of December 31, 2022, the Bank’s paid-in capital is W 2,021,896 million.

The Bank engages in the banking business in accordance with the Banking Act, trust business in accordance with the Financial Investment Services and Capital Markets Act, mobile virtual network business in accordance with Special Act on Support for Financial Innovation, and other relevant businesses. As of December 31, 2022, the Bank operates its Seoul headquarters and 856 domestic branches, and nine overseas branches (excluding six subsidiaries and one office).

2. Basis of Preparation

2.1 Application of Korean IFRS

The Bank maintains its accounting records in Korean won and prepares statutory financial statements in the Korean language in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (“Korean IFRS”). The accompanying separate financial statements have been translated into English from the Korean language separate financial statements.

The separate financial statements of the Bank have been prepared in accordance with Korean IFRS. Korean IFRS are the standards and related interpretations issued by the International Accounting Standards Board (“IASB”) that have been adopted by the Republic of Korea.

The preparation of the separate financial statements requires the use of certain critical accounting estimates. Management also needs to exercise judgment in applying the Bank’s accounting policies. The areas that require a more complex and higher level of judgment or areas that require significant assumptions and estimations are disclosed in Note 2.4.

7

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

The separate financial statements have been prepared in accordance with Korean IFRS No.1027 Separate Financial Statements.

2.1.1 The Bank has applied the following amended standards for the first time for its annual reporting period commencing January 1, 2022.

- Amendments to Korean IFRS No.1116 Leases - COVID-19-Related Rent Concessions, etc. beyond June 30, 2021

The application of the practical expedient, a lessee may elect not to assess whether a rent concession occurring as a direct consequence of the COVID-19 pandemic is a lease modification, is extended to lease payments originally due on or before 30 June 2022. A lessee shall apply the practical expedient consistently to eligible contracts with similar characteristics and in similar circumstances. These amendments do not have a significant impact on the financial statements.

- Amendments to Korean IFRS No.1103 Business Combination – Reference to the Conceptual Framework

The amendments update a reference of definition of assets and liabilities to qualify for recognition in revised Conceptual Framework for Financial Reporting. However, the amendments add an exception for the recognition of liabilities and contingent liabilities within the scope of Korean IFRS No.1037 Provisions, Contingent Liabilities and Contingent Assets, and Korean IFRS No.2121 Levies. The amendments also confirm that contingent assets should not be recognized at the acquisition date. These amendments do not have a significant impact on the financial statements.

- Amendments to Korean IFRS No.1016 Property, Plant and Equipment - Proceeds Before Intended Use

The amendments prohibit an entity from deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while the entity is preparing the asset for its intended use. Instead, the entity will recognize the proceeds from selling such items, and the costs of producing those items, as profit or loss. These amendments do not have a significant impact on the financial statements.

- Amendments to Korean IFRS No.1037 Provisions, Contingent Liabilities and Contingent Assets - Onerous Contracts: Cost of Fulfilling a Contract

The amendments clarify that the direct costs of fulfilling a contract include both the incremental costs of fulfilling the contract and an allocation of other costs directly related to fulfilling contracts when assessing whether the contract is onerous. These amendments do not have a significant impact on the financial statements.

- Annual improvements to Korean IFRS 2018-2020

These amendments do not have a significant impact on the financial statements.

• Korean IFRS No.1101 First-time Adoption of Korean International Financial Reporting Standards – Subsidiaries as a first-time adopter

• Korean IFRS No.1109 Financial Instruments – Fees related to the 10% test for derecognition of financial liabilities

• Korean IFRS No.1116 Leases – Lease incentives

• Korean IFRS No.1041 Agriculture – fair value measurement

8

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

2.1.2 The Bank has changed the following accounting policy for its annual reporting period commencing January 1, 2022.

The Bank classified some restricted demand deposits, such as reserve deposits, as due from financial institutions measured at amortized cost rather than cash and cash equivalents; however, following the International Accounting Standards Interpretation Committee’s decision that cash and cash equivalents include restricted demand deposits, some restricted demand deposits, such as reserve deposits, have been classified as cash and cash equivalents and retrospectively applied from January 1, 2022. The comparative financial statements have been restated to reflect changes made due to retrospective application.

The application of these accounting policy changes has no effect on the statement of financial position as of December 31, 2022 and 2021, and the statements of comprehensive income for the years ended December 31, 2022 and 2021.

Effects on the statements of cash flows for the years ended December 31, 2022 and 2021, are as follows:

2.1.2.1 Increase in details of statement of Cash Flow

(In millions of Korean won)	2022		2021
Increase in other assets		64,181		4,623,387
Increase of exchange rate changes on cash and cash equivalents denominated in foreign currency		71,414		65,096
Increase in beginning balance of cash and cash equivalents		15,877,938		11,189,455
Increase in ending balance of cash and cash equivalents		16,013,533		15,877,938

2.1.2.2 Statement of Cash Flow (2022)

(In millions of Korean won)	Before			After			Increase
Other assets		(1,366,084	)		(1,301,903	)		64,181
Exchange rate changes on cash and cash equivalents denominated in foreign currency		(221,968	)		(150,554	)		71,414
Beginning balance of cash and cash equivalents		5,994,103			21,872,041			15,877,938
Ending balance of cash and cash equivalents		5,979,611			21,993,144			16,013,533

2.1.2.3 Statement of Cash Flow (2021)

(In millions of Korean won)	Before			After		Increase
Other assets		(3,715,133	)		908,254		4,623,387
Exchange rate changes on cash and cash equivalents denominated in foreign currency		193,616			258,712		65,096
Beginning balance of cash and cash equivalents		5,784,727			16,974,182		11,189,455
Ending balance of cash and cash equivalents		5,994,103			21,872,041		15,877,938

2.1.3 The following new and amended standards have been published that are not mandatory for December 31, 2021 reporting period and have not been adopted by the Bank.

9

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

- Amendments to Korean IFRS No.1001 Presentation of Financial Statements - Classification of Liabilities as Current or Non-current

The amendments clarify that liabilities are classified as either current or non-current, depending on the substantive rights that exist at the end of the reporting period. Classification is unaffected by the likelihood that an entity will exercise the right to defer settlement of the liability or the management’s expectations thereof. Also, the settlement of liability includes the transfer of the entity’s own equity instruments; however, it would be excluded if an option to settle the liability by the transfer of the entity’s own equity instruments is recognized separately from the liability as an equity component of a compound financial instrument. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Bank does not expect that these amendments have a significant impact on the financial statements.

- Issuance of Korean IFRS No.1117 Insurance Contracts

Korean IFRS No.1117 Insurance Contracts will replace Korean IFRS No.1104 Insurance Contracts. This standard requires an entity to estimate future cash flows of an insurance contract and measure insurance liabilities using discount rates applied with assumptions and risks at the measurement date and recognize insurance revenue on an accrual basis including services (insurance coverage) provided to the policyholder by each annual reporting period. In addition, investment components (refunds due to termination and maturity) repaid to a policyholder even if an insured event does not occur, are excluded from insurance revenue, and net insurance income and net investment income are presented separately to enable users of the information to understand the sources of net income. This standard should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted for entities that applied Korean IFRS No.1109 Financial Instruments. The Bank is scheduled to apply this standard for annual reporting period beginning on January 1, 2023. The Bank does not expect that this new standard has a significant impact on the financial statements.

- Amendments to Korean IFRS No.1001 Presentation of Financial Statements – Accounting Policy Disclosure

The amendments require an entity to define and disclose their material accounting policy information. IFRS Practice Statement 2 Making Materiality Judgements was amended to explain and demonstrate how to apply the concept of materiality. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Bank does not expect that these amendments have a significant impact on the financial statements.

- Amendments to Korean IFRS No.1008 Accounting Policies, Changes in Accounting Estimates and Errors – Definition of Accounting Estimates

The amendments introduce the definition of accounting estimates and clarify how to distinguish changes in accounting estimates from changes in accounting policies. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Bank does not expect that these amendments have a significant impact on the financial statements.

- Amendments to Korean IFRS No.1012 Income Taxes – Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction

The amendments narrow the scope of the deferred tax recognition exemption so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Bank does not expect that these amendments have a significant impact on the financial statements.

10

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

- Amendments to Korean IFRS No.1001 Presentation of Financial Statements—Disclosure of gains or losses on valuation of financial liabilities subject to exercise price adjustment conditions

The amendments require disclosures about gains or losses on valuation occurred for the reporting period (but are limited to those included in profit or loss) for the conversion options or warrants (or financial liabilities with warrants), if all or part of the financial instrument whose exercise price is adjusted due to the issuers’ stock price fluctuations, are classified as financial liabilities according to paragraph 11 of Korean IFRS No.1032 Financial Instruments: Presentation. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Bank does not expect that these amendments have a significant impact on the financial statements.

2.2 Measurement Basis

The separate financial statements have been prepared based on the historical cost accounting model unless otherwise specified.

2.3 Functional and Presentation Currency

Items included in the financial statements of the Bank are measured using the currency of the primary economic environment in which the Bank operates (“functional currency”). The separate financial statements are presented in Korean won, which is the Bank’s functional and presentation currency.

2.4 Critical Accounting Estimates

The Bank applies accounting policies and uses judgements, accounting estimates, and assumptions that may have a significant impact on the assets (liabilities) and incomes (expenses) in preparing the separate financial statements. Management’s estimates of outcomes may differ from actual outcomes if management’s estimates and assumptions based on management’s best judgment are different from the actual environment.

Estimates and underlying assumptions are continually evaluated, and changes in accounting estimates are recognized in the period in which the estimates are changed and in any future periods affected.

Uncertainties in estimates and assumptions with significant risks that may result in material adjustments to the separate financial statements are as follows:

2.4.1 Income taxes

As the income taxes on the Bank’s taxable income is calculated by applying the tax laws of various countries and the decisions of tax authorities, there is uncertainty in calculating the final tax effect.

If a certain portion of the taxable income is not used for investments, wages, etc. in accordance with the Korean regulation called ‘Special Taxation for Facilitation of Investment and Mutually-beneficial Cooperation’, the Bank is liable to pay additional income tax calculated based on the tax laws. Therefore, the effect of recirculation of corporate income should be reflected in current and deferred income tax. As the Bank’s income tax is dependent on the actual investments, wages, etc. per each year, there are uncertainties in measuring the final tax effects during the period when the tax law is applied.

11

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

2.4.2 Fair value of financial instruments

The fair value of financial instruments where no active market exists or where quoted prices are not otherwise available is determined by using valuation techniques. Financial instruments, which are not actively traded in the market and those with less transparent market prices, will have less objective fair values and require broad judgment on liquidity, concentration, uncertainty in market factors, assumptions in fair value determination, and other risks.

As described in the significant accounting policies in Note 3.3 Recognition and Measurement of Financial Instruments, diverse valuation techniques are used to determine the fair value of financial instruments, from generally accepted market valuation models to internally developed valuation models that incorporate various types of assumptions and variables.

2.4.3 Allowances and provisions for credit losses

The Bank recognizes and measures allowances for credit losses of debt instruments measured at amortized cost and debt instruments measured at fair value through other comprehensive income. Also, the Bank recognizes and measures provisions for credit losses of acceptances and guarantees, and unused loan commitments. Accuracy of allowances and provisions for credit losses is dependent upon estimation of expected cash flows of the borrower subject to individual assessment of impairment, and upon assumptions and variables of model used in collective assessment of impairment and estimation of provisions for credit losses of acceptances and guarantees, and unused loan commitments.

2.4.4 Net defined benefit asset(liability)

The present value of the net defined benefit asset(liability) is affected by changes in the various factors determined by the actuarial method.

2.4.5 Impairment of goodwill

The recoverable amounts of cash-generating units are determined based on value-in-use calculations to test whether impairment of goodwill has occurred.

12

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3. Significant Accounting Policies

The principal accounting policies applied in the preparation of these separate financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

3.1 Investments in Associates and Subsidiaries

Associates are entities over which the Bank has significant influence over the financial and operating policy decisions. Generally, if the Bank holds 20% or more of the voting power of the investee, it is presumed that the Bank has significant influence.

Subsidiaries are companies that are controlled by the Bank. The Bank controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Also, the existence and effects of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Bank controls the investee. Subsidiaries are fully consolidated from the date when control is transferred to the Bank and de-consolidated from the date when control is lost.

Investments in associates and subsidiaries are accounted for at cost in accordance with Korean IFRS No.1027. However, beneficiary certificates in private equity fund which is consolidated is classified as financial assets at fair value through profit or loss in accordance with Korean IFRS No.1109 and measured at fair value in accordance with Korean IFRS No.1113.

The Bank determines at each reporting period whether there is any objective evidence that the investments in the associates and subsidiaries that are accounted for by cost method are impaired. If this is the case, the Bank calculates the amount of impairment as the difference between the recoverable amount of the associate or subsidiary and its carrying amount and recognizes the amount as non-operating expenses in the statement of comprehensive income.

3.2 Foreign Currency

3.2.1 Foreign currency transactions

A foreign currency transaction is recorded, at initial recognition in the functional currency, by applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction. At the end of each reporting period, foreign currency monetary items are translated using the closing rate which is the spot exchange rate at the end of the reporting period. Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rate at the date when the fair value was measured and non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

Except for the exchange differences for the net investment in a foreign operation and the financial liability designated as a hedging instrument of net investment, exchange differences arising on the settlement of monetary items or on translating monetary items are recognized in profit or loss. When a gain or loss on a non-monetary item is recognized in other comprehensive income, any exchange component of that gain or loss is recognized in other comprehensive income, conversely, when a gain or loss on a non-monetary item is recognized in profit or loss, any exchange component of that gain or loss is recognized in profit or loss.

13

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.2.2 Foreign operations

The results and financial position of a foreign operation, whose functional currency differs from the Bank’s presentation currency, are translated into the Bank’s presentation currency based on the following procedures.

If the functional currency of a foreign operation is not the currency of a hyperinflationary economy, assets and liabilities for each statement of financial position presented (including comparatives) are translated at the closing rate at the end of the reporting period, income and expenses for each statement of comprehensive income presented (including comparatives) are translated using the average exchange rates for the period. All resulting exchange differences are recognized in other comprehensive income.

Any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition of that foreign operation are treated as assets and liabilities of the foreign operation. Thus, they are expressed in the functional currency of the foreign operation and are translated into the presentation currency at the closing rate.

On the disposal of a foreign operation, the cumulative amount of the exchange differences relating to that foreign operation, recognized in other comprehensive income and accumulated in the separate component of equity, is reclassified from equity to profit or loss (as a reclassification adjustment) when the gain or loss on disposal is recognized. On the partial disposal of a subsidiary that includes a foreign operation, the Bank re-attributes the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income to the non-controlling interests in that foreign operation. In any other partial disposal of a foreign operation, the Bank reclassifies to profit or loss only the proportionate share of the cumulative amount of the exchange differences recognized in other comprehensive income.

3.2.3 Translation of the net investment in a foreign operation

A monetary item that is receivable from or payable to a foreign operation, for which settlement is neither planned nor likely to occur in the foreseeable future is, in substance, a part of the Bank’s net investment in that foreign operation, then foreign currency difference arising from that monetary item is recognized in the other comprehensive income and shall be reclassified to profit or loss on disposal of the net investment.

3.3 Recognition and Measurement of Financial Instruments

3.3.1 Initial recognition

The Bank recognizes a financial asset or a financial liability in its statement of financial position when the Bank becomes party to the contractual provisions of the instrument. A regular way purchase or sale of financial assets (a purchase or sale of a financial asset under a contract whose terms require delivery of the asset within the time frame established generally by regulation or convention in the marketplace concerned) is recognized and derecognized using trade date accounting.

For financial reporting purpose, the Bank classifies (a) financial assets as financial assets at fair value through profit or loss, financial assets at fair value through other comprehensive income, or financial assets at amortized cost and (b) financial liabilities as financial liabilities at fair value through profit or loss, or other financial liabilities. These classifications are based on the business model for managing financial instruments and the contractual cash flow characteristics of the financial instrument at initial recognition.

14

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

At initial recognition, a financial asset or financial liability is measured at its fair value plus or minus, in the case of a financial asset or financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability. The fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The fair value of a financial instrument on initial recognition is normally the transaction price (that is, the fair value of the consideration given or received) in an arm’s length transaction.

3.3.2 Subsequent measurement

After initial recognition, financial instruments are measured at amortized cost or fair value based on classification at initial recognition.

3.3.2.1 Amortized cost

The amortized cost of a financial asset or financial liability is the amount at which the financial asset or financial liability is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between that initial amount and the maturity amount and, for financial assets, adjusted for any loss allowance.

3.3.2.2 Fair value

The Bank uses quoted price in an active market which is based on listed market price or dealer price quotations of financial instruments traded in an active market as best estimate of fair value. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis.

If there is no active market for a financial instrument, fair value is determined either by using a valuation technique or independent third-party valuation service. Valuation techniques include using recent arm’s length market transactions between knowledgeable and willing parties, if available, referencing the current fair value of another instrument that is substantially the same, discounted cash flow analysis, and option pricing models.

The Bank uses valuation models that are commonly used by market participants and customized for the Bank to determine fair values of common over-the-counter (“OTC”) derivatives such as options, interest rate swaps, and currency swaps which are based on the inputs observable in markets. However, for some complex financial instruments that require fair value measurement by valuation techniques based on certain assumptions because some or all inputs used in the model are not observable in the market, the Bank uses internal valuation models developed from general valuation models or valuation results from independent external valuation institutions.

In addition, the fair value information recognized in the statement of financial position is classified into the following fair value hierarchy, reflecting the significance of the input variables used in the fair value measurement.

Level 1 :	Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Bank can access at the measurement date
Level 2 :	Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly
Level 3 :	Unobservable inputs for the asset or liability

15

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

The fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety.

If a fair value measurement uses observable inputs that require significant adjustment using unobservable inputs, that measurement is a Level 3 measurement.

The Bank’s Fair Value Evaluation Committee, which consists of the risk management department, trading department and accounting department, reviews the appropriateness of internally developed valuation models, and approves the selection and changing of the external valuation institution and other considerations related to fair value measurement. The results of regular verification of the internally developed valuation models are reported to the Market Risk Management Subcommittee.

If the valuation technique does not reflect all factors which market participants would consider in pricing the asset or liability, the fair value is adjusted to reflect those factors. Those factors include counterparty credit risk, liquidity risk, and others.

The Bank uses valuation technique which maximizes the use of market inputs and minimizes the use of entity-specific inputs. It incorporates all factors that market participants would consider in pricing the asset or liability and is consistent with economic methodologies applied for pricing financial instruments. Periodically, the Bank calibrates the valuation technique and tests its validity using prices of observable current market transactions of the same instrument or based on other relevant observable market data.

3.3.3 Derecognition

Derecognition is the removal of a previously recognized financial asset or financial liability from the statement of financial position. The derecognition criteria for financial assets and financial liabilities are as follows:

3.3.3.1 Derecognition of financial assets

A financial asset is derecognized when the contractual rights to the cash flows from the financial assets expire or the Bank transfers substantially all the risks and rewards of ownership of the financial asset, or the Bank neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset and the Bank has not retained control. Therefore, if the Bank does not transfer substantially all the risks and rewards of ownership of the financial asset, the Bank continues to recognize the financial asset to the extent of its continuing involvement in the financial asset.

If the Bank transfers the contractual rights to receive the cash flows of the financial asset but retains substantially all the risks and rewards of ownership of the financial asset, the Bank continues to recognize the transferred asset in its entirety and recognize a financial liability for the consideration received.

The Bank writes off a financial asset when the Bank has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. In general, the Bank considers write-off when it is determined that the debtor does not have sufficient funds or income to cover the principal and interest. The write-off decision is made in accordance with internal regulations. After the write-off, the Bank can continue to collect the written-off loans according to the internal policy. Recovered amounts from financial assets previously written-off are recognized in profit or loss.

16

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.3.3.2 Derecognition of financial liabilities

A financial liability is derecognized from the statement of financial position when it is extinguished (i.e., the obligation specified in the contract is discharged, canceled or expires).

3.3.4 Offsetting

A financial asset and a financial liability are offset, and the net amount is presented in the statement of financial position when, and only when, the Bank currently has a legally enforceable right to set off the recognized amounts and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on a future event and must be legally enforceable in the normal course of business, the event of default, and the event of insolvency or bankruptcy of the Bank and all of the counterparties.

3.4 Cash and Due from Financial Institutions

Cash and due from financial institutions include cash on hand, foreign currency, and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and due from financial institutions. Cash and due from financial institutions are measured at amortized cost.

3.5 Non-derivative Financial Assets

3.5.1 Financial assets at fair value through profit or loss

Financial assets are classified as financial assets at fair value through profit or loss unless they are classified as financial assets at amortized cost or at fair value through other comprehensive income.

The Bank may designate certain financial assets upon initial recognition as at fair value through profit or loss when the designation eliminates or significantly reduces a measurement or recognition inconsistency (sometimes referred to as an ‘accounting mismatch’) that would otherwise arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases.

After initial recognition, a financial asset at fair value through profit or loss is measured at fair value and gains or losses arising from a change in fair value are recognized in profit or loss. Interest income using the effective interest method and dividend income from financial assets at fair value through profit or loss are also recognized in profit or loss.

3.5.2 Financial assets at fair value through other comprehensive income

The Bank classifies below financial assets as financial assets at fair value through other comprehensive income:

• Debt instruments that are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and where the assets’ cash flows represent solely payments of principal and interest on the principal amount outstanding and;

• Equity instruments that are not held for short-term trading but held for strategic investment, and designated as financial assets at fair value through other comprehensive income

17

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

After initial recognition, a financial asset at fair value through other comprehensive income is measured at fair value. Gains or losses arising from a change in fair value, other than dividend income, interest income calculated using the effective interest method and exchange differences arising on monetary items which are recognized directly in profit or loss, are recognized in other comprehensive income in equity.

When the financial assets at fair value through other comprehensive income is disposed of, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss. However, cumulative gain or loss of equity instruments designated at fair value through other comprehensive income is reclassified to retained earnings not to profit or loss at disposal.

A financial asset at fair value through other comprehensive income denominated in foreign currency is translated at the closing rate. Exchange differences resulting from changes in amortized cost are recognized in profit or loss, and other changes are recognized in equity.

3.5.3 Financial assets at amortized cost

A financial asset, which is held within the business model whose objective is achieved by collecting contractual cash flows, and where the assets’ cash flows represent solely payments of principal and interest on the principal amount outstanding, is classified as a financial asset at amortized cost. After initial recognition, a financial asset at amortized cost is measured at amortized cost using the effective interest method and interest income is calculated using the effective interest method.

3.6 Expected Credit Losses of Financial Assets (Debt Instruments)

The Bank recognizes loss allowances for expected credit losses at the end of the reporting period for financial assets at amortized cost and fair value through other comprehensive income except for financial assets at fair value through profit or loss.

Expected credit losses are estimated at present value of probability-weighted amount that is determined by evaluating a range of possible outcomes. The Bank measures expected credit losses by reflecting all reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions, and forecasts of future economic conditions.

The approaches of measuring expected credit losses in accordance with Korean IFRS are as follows:

• General approach: for financial assets and unused loan commitments not subject to the below approach

• Credit-impaired approach: for financial assets that are credit-impaired at the time of acquisition

Application of general approach is differentiated depending on whether credit risk has increased significantly after initial recognition. If the credit risk on a financial instrument has not increased significantly since initial recognition, the Bank measures loss allowances for that financial instrument at an amount equal to 12-month expected credit losses, whereas if the credit risk on a financial instrument has increased significantly since initial recognition, the Bank measures loss allowances for a financial instrument at an amount equal to the lifetime expected credit losses. Lifetime is the period until the contractual maturity date of financial instruments and means the expected life.

The Bank assesses whether the credit risk has increased significantly using the following criteria, and if one or more of the following criteria are met, it is deemed as significant increase in credit risk. If the contractual cash flows of a financial asset have been renegotiated or modified, the Bank assesses whether the credit risk has increased significantly using the same following criteria.

18

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

• More than 30 days past due

• Decline in credit rating at the end of the reporting period by certain notches or more compared to the time of initial recognition

• Subsequent managing ratings below certain level in the early warning system

• Debt restructuring (except for impaired financial assets) and

• Credit delinquency information of Korea Federation of Banks, etc.

The Bank generally considers the loan to be credit-impaired if one or more of the following criteria are met:

• 90 days or more past due

• Legal proceedings related to collection

• A borrower registered on the credit management list of Korea Federation of Banks

• A corporate borrower with the credit rating C and D

• Refinancing and

• Debt restructuring

3.6.1 Forward-looking information

The Bank uses forward-looking information, when determining whether credit risk has increased significantly and measuring expected credit losses.

The Bank assumes that the risk components have a constant correlation with the economic cycle and uses statistical methodologies to estimate the relation between key macroeconomic variables and risk components for the expected credit losses. The Bank has derived a correlation between the time series data of 13 years or more and the key macroeconomic variables and calculates the expected credit losses by reflecting the results of the correlation on the risk component.

The correlation between the major macroeconomic variables and the credit risk are as follows:

Key macroeconomic variables	Correlation between the major macroeconomic variables and the credit risk
Domestic GDP growth rate	(-)
Composite stock index	(-)
Growth rate of construction investment	(-)
Rate of increase in housing transaction price index	(-)
Interest rate spread	(+)
Private consumption growth rate	(-)

Forward-looking information used in calculation of expected credit losses is based on the macroeconomic forecasts utilized by management of the Bank for its business plan considering reliable external agency’s forecasts and others. The forward-looking information is generated by KB Research with a comprehensive approach to capture the possibility of various economic forecast scenarios that are derived from the internal and external viewpoints of the macroeconomic situation. The Bank determines the macroeconomic variables to be used in forecasting future conditions of the economy, considering the direction of the forecast scenario and the significant relationship between macroeconomic variables and time series data. And there are some changes compared to the macroeconomic variables used in the previous year.

As of December 31, 2022, the Bank measures expected credit losses by applying both the worse scenario and the crisis scenario, taking into consideration the potential credit risk resulting from the uncertain financial environment locally and globally and the rapid economic recession.

19

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.6.2 Measuring expected credit losses on financial assets at amortized cost

The expected credit losses of financial assets at amortized cost are measured as present value of the difference between the contractual cash flows to be received and the cash flows expected to be received. The Bank estimates expected future cash flows for financial assets that are individually significant. The Bank selects the individually significant financial assets by comprehensively considering quantitative and qualitative factors (such as debt restructuring or negative net assets, etc.) among financial assets with the credit risk has increased significantly or credit-impaired (individual assessment of impairment).

For financial assets that are not individually significant, the Bank collectively estimates expected credit losses by grouping loans with a homogeneous credit risk profile (collective assessment of impairment).

3.6.2.1 Individual assessment of impairment

Individual assessment of impairment losses is performed using management’s best estimate on the present value of expected future cash flows. The Bank uses all the available information including financial condition of the borrower such as operating cash flow and net realizable value of any collateral held.

3.6.2.2 Collective assessment of impairment

Collective assessment of impairment losses is performed by using a methodology based on historical loss experience and reflecting forward-looking information. Such a process incorporates factors such as type of collateral, type of product, type of borrower, credit rating, size of portfolio, and recovery period and applies Probability of Default (“PD”) on a group of assets and Loss Given Default (“LGD”) by type of recovery method. Also, the Bank applies certain assumptions to model expected credit losses assessment and to determine input based on loss experience and forward-looking information. These models and assumptions are periodically reviewed to reduce the gap between loss estimate and actual loss experience.

The lifetime expected credit losses are measured by applying the PD to the carrying amount calculated by deducting the expected principal repayment amount from the carrying amount as of the reporting date and the LGD adjusted to reflect changes in the carrying amount.

3.6.3 Measuring expected credit losses on financial assets at fair value through other comprehensive income

The Bank measures expected credit losses on financial assets at fair value through other comprehensive income in a manner that is consistent with the requirements that are applicable to financial assets at amortized cost. However, loss allowances are recognized in other comprehensive income. Upon disposal or repayment of financial assets at fair value through other comprehensive income, the amount of loss allowances is reclassified from other comprehensive income to profit or loss.

3.7 Derivative Financial Instruments

The Bank enters into numerous derivative financial instrument contracts such as currency forwards, interest rate swaps, currency swaps, and others for trading purposes or to manage its interest rate risk, currency risk, and others. The Bank’s derivative financial instruments business focuses on addressing the needs of the Bank’s corporate clients to hedge their risk exposure and to hedge the Bank’s risk exposure that results from such client contracts. These derivative financial instruments are presented as derivative financial instruments in the financial statements irrespective of transaction purpose and subsequent measurement requirement.

20

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

The Bank designates certain derivative financial instruments as hedging instruments to hedge the risk of changes in fair value of a recognized asset or liability or of an unrecognized firm commitment (fair value hedge) and the risk of changes in cash flow (cash flow hedge).

At the inception of the hedging relationship, there is formal designation and documentation of the hedging relationship and the Bank’s risk management objective and strategy for undertaking the hedge. This documentation includes identification of the hedging instrument, the hedged item, the nature of the risk being hedged, the inception date of hedging relationship and how the Bank will assess the hedging instrument’s effectiveness in offsetting the changes in the hedged item’s fair value or cash flows attributable to the hedged risk.

Derivative financial instruments are initially recognized at fair value. After initial recognition, derivative financial instruments are measured at fair value, and changes therein are accounted for as described below.

3.7.1 Derivative financial instruments held for trading

All derivative financial instruments, except for derivatives that are designated and qualify for hedge accounting, are measured at fair value. Gains or losses arising from changes in fair value are recognized in profit or loss as part of net gains or losses on financial instruments at fair value through profit or loss.

3.7.2 Derivative financial instruments for fair value hedges

If derivative financial instruments are designated and qualify for fair value hedges, changes in fair value of the hedging instrument and changes in fair value of the hedged item attributable to the hedged risk are recognized in profit or loss as part of other operating income or expenses. If the hedged items are equity instruments for which the Bank has elected to present changes in fair value in other comprehensive income, changes in fair value of the hedging instrument and changes in fair value of the hedged item attributable to the hedged risk are recognized in other comprehensive income.

Fair value hedge accounting is discontinued prospectively if the hedging instrument expires or is sold, terminated or exercised, or the hedging relationship ceases to meet the qualifying criteria. Once fair value hedge accounting is discontinued, the adjustment to the carrying amount of a hedged item is amortized to profit or loss by the maturity of the financial instrument using the effective interest method.

3.7.3 Derivative financial instruments for cash flow hedges

The effective portion of changes in fair value of derivative financial instruments that are designated and qualify for cash flow hedges is recognized in other comprehensive income, limited to the cumulative change in fair value (present value) of the hedged item (the present value of the cumulative change in the hedged expected future cash flows) from inception of the hedge. The ineffective portion is recognized in profit or loss as other operating income or expenses. The associated gains or losses that were previously recognized in other comprehensive income are reclassified from equity to profit or loss (other operating income or expenses) as a reclassification adjustment in the same period or periods during which the hedged forecast cash flows affect profit or loss. Cash flow hedge accounting is discontinued prospectively if the hedging instrument expires or is sold, terminated or exercised, or the hedging relationship ceases to meet the qualifying criteria. When the cash flow hedge accounting is discontinued, the cumulative gains or losses on the hedging instrument that have been recognized in other comprehensive income are reclassified to profit or loss over the period in which the forecast transaction occurs. If the forecast transaction is no longer expected to occur, the cumulative gains or losses that have been recognized in other comprehensive income are immediately reclassified to profit or loss.

21

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.7.4 Risk management strategy

Interest rate risk arises from changes in fair value resulting from changes in the discount rate of fixed rate financial instruments, and changes in cash flows resulting from changes in the nominal interest rate of floating rate financial instruments.

The Bank hedges the interest rate risk in its entirety. At inception of the hedge relationship, the Bank reviews the hedge effectiveness; and periodically reviews the effectiveness in order to confirm that economic relationship between the hedged item and the hedging instrument exists. The requirement that an economic relationship exists means that the hedging instrument and the hedged item have values that generally move in the opposite direction due to the same risk, which is the hedged risk. The Bank designates the exposure of hedged item opposite to the exposure of hedging instruments in order to meet economic relationship requirement.

The Bank designates hedge relationship at one-on-one ratio between the nominal amount of hedging instrument and to the nominal amount of hedged item.

Hedge ineffectiveness could arise because of differences in the underlying parameters (acquisition date, credit risk or liquidity and others) or other differences between the hedging instrument and the hedged item that the Bank accepts in order to achieve a cost-effective hedging relationship.

The Bank avoids the cash flow variability of its floating rate debt securities by using interest rate swaps. Both are linked to the same interest rate; however, the paid amount of the floating rate may be set on different dates. Even if the variability of interest rate related cash flows (as a risk factor) is designated as a hedged item, the difference in set-up dates creates a hedge ineffectiveness.

The Bank avoids the variability of fair values of its fixed rate debt securities by using interest rate swaps. The calculating method of the number of the dates for paying fixed-rate interest amount can be different between hedging instruments and hedged items. Even if the variability of the fair value due to the benchmark interest rate (as a risk factor) are designated as a hedged item, the difference in calculating method of the number of the dates creates a hedge ineffectiveness.

3.7.5 Embedded derivatives

An embedded derivative is separated from the host contract and accounted for as a derivative if, and only if, (a) the economic characteristics and risks of the embedded derivative are not closely related to those of the host contract, (b) a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative and (c) the hybrid contract contains a host that is not a financial asset and is not designated as at fair value through profit or loss. Gains or losses arising from a change in fair value of an embedded derivative separated from the host contract are recognized in profit or loss as part of net gains or losses on financial instruments at fair value through profit or loss.

3.7.6 Day one gains or losses

If the Bank uses a valuation technique that incorporates unobservable inputs for the fair value of the OTC derivatives at initial recognition, there may be a difference between the transaction price and the amount determined using that valuation technique. In these circumstances, the difference is not recognized in profit or loss but deferred and amortized using the straight-line method over the life of the financial instrument. If the fair value is subsequently determined using observable inputs, the remaining deferred amount is recognized in profit or loss as part of net gains or losses on financial instruments at fair value through profit or loss or other operating income or expenses.

22

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.8 Property and Equipment

3.8.1 Recognition and measurement

Property and equipment that qualify for recognition as an asset are measured at cost and subsequently carried at its cost less any accumulated depreciation and any accumulated impairment losses.

The cost of property and equipment includes any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management and the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

Subsequent expenditures are capitalized only when they prolong the useful life or enhance values of the assets but the costs of the day-to-day servicing of the assets such as repair and maintenance costs are recognized in profit or loss as incurred. When part of an item of property and equipment has a useful life different from that of the entire asset, it is recognized as a separate asset.

3.8.2 Depreciation

Land is not depreciated, whereas other property and equipment are depreciated using the method that reflects the pattern in which the asset’s future economic benefits are expected to be consumed by the Bank. The depreciable amount of an asset is determined after deducting its residual value.

Each part of an item of property and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately.

The depreciation method and estimated useful life of property and equipment are as follows:

Property and equipment	Depreciation method	Estimated useful life
Buildings	Straight-line	40 years
Leasehold improvements	Diminishing-balance	4 years
Equipment and vehicles	Diminishing-balance	4 years

The residual value, the useful life, and the depreciation method applied to an asset are reviewed at each financial year-end and, if expectations differ from previous estimates, the changes are accounted for as a change in an accounting estimate.

23

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.9 Investment Properties

3.9.1 Recognition and measurement

Properties held to earn rentals or for capital appreciation or both are classified as investment properties. Investment properties are measured initially at their cost and subsequently the cost model is used.

3.9.2 Depreciation

Land is not depreciated, whereas other investment properties are depreciated using the method that reflects the pattern in which the asset’s future economic benefits are expected to be consumed by the Bank. The depreciable amount of an asset is determined after deducting its residual value.

The depreciation method and estimated useful life of investment properties are as follows:

Investment properties	Depreciation method	Estimated useful life
Buildings	Straight-line	40 years

The residual value, the useful life, and the depreciation method applied to an asset are reviewed at each financial year-end and, if expectations differ from previous estimates, the changes are accounted for as a change in an accounting estimate.

3.10 Intangible Assets

Intangible assets are measured initially at cost and subsequently carried at their cost less any accumulated amortization and any accumulated impairment losses.

Intangible assets, except for goodwill and membership rights, are amortized using the straight-line method with no residual value over their estimated useful life since the assets are available for use.

Intangible assets	Amortization method	Estimated useful life
Industrial property rights	Straight-line	5 years
Software	Straight-line	4~5 years
Others	Straight-line	1~13 years

The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at each financial year-end. Where an intangible asset is not being amortized because its useful life is indefinite, the Bank carries out a review in each accounting period to confirm whether events and circumstances still support an indefinite useful life assessment. If they do not, the change in the useful life assessment from indefinite to finite is accounted for as a change in an accounting estimate.

24

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.10.1 Goodwill

3.10.1.1 Recognition and measurement

Goodwill related to business combinations before January 1, 2010, is stated at its carrying amount, which was recognized under the Bank’s previous accounting policy, prior to the transition to Korean IFRS.

Goodwill acquired from business combinations after January 1, 2010, is initially measured as the excess of the consideration transferred over the fair value of net identifiable assets acquired and liabilities assumed. If the fair value of net identifiable assets acquired and liabilities assumed exceeds the consideration transferred, the difference is recognized in profit or loss.

Acquisition-related costs incurred to effect a business combination are charged to expenses in the periods in which the costs are incurred and the services are received, except for the costs to issue debt or equity securities.

3.10.1.2 Subsequent measurement

Goodwill is not amortized and is stated at cost less accumulated impairment losses. However, goodwill that forms part of the carrying amount of an investment in associates and subsidiaries is not separately recognized and an impairment loss recognized is not allocated to any asset, including goodwill, which forms part of the carrying amount of the investment in the associates.

3.10.2 Subsequent expenditures

Subsequent expenditures are capitalized only when they enhance values of the assets. Internally generated intangible assets, such as goodwill and trade name, are not recognized as assets but expensed as incurred.

3.11 Impairment of Non-financial Assets

The Bank assesses at the end of each reporting period whether there is any indication that a non-financial asset, except for (a) deferred income tax assets, (b) assets arising from employee benefits and (c) non-current assets (or group of assets to be sold) classified as held for sale, may be impaired. If any such indication exists, the Bank estimates the recoverable amount of the asset. However, irrespective of whether there is any indication of impairment, the Bank tests (a) goodwill acquired in a business combination, (b) intangible assets with an indefinite useful life and (c) intangible assets not yet available for use for impairment annually by comparing their carrying amount with their recoverable amount.

The recoverable amount is estimated for the individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the Bank determines the recoverable amount of the cash-generating unit to which the asset belongs. A cash-generating unit is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. The recoverable amount of an asset is the higher of its fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from an asset or cash-generating unit that are discounted by a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the future cash flow estimates have not been adjusted.

25

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

If the recoverable amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. That reduction is an impairment loss and recognized immediately in profit or loss. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash-generating units that is expected to benefit from the synergies of the combination. The impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the cash-generating unit and then to the other assets of the unit pro rata on the basis of the carrying amount of each asset in the unit.

An impairment loss recognized for goodwill is not reversed in a subsequent period. The Bank assesses at the end of each reporting period whether there is any indication that an impairment loss recognized in prior periods for an asset, other than goodwill, may no longer exist or may have decreased, and an impairment loss recognized in prior periods for an asset other than goodwill shall be reversed if, and only if, there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized. The increased carrying amount of an asset other than goodwill attributable to a reversal of an impairment loss cannot exceed the carrying amount that would have been determined (net of amortization or depreciation) had no impairment loss been recognized for the asset in prior years.

3.12 Non-current Assets Held for Sale

A non-current asset or disposal group is classified as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use. For this to be the case, the asset (or disposal group) must be available for immediate sale in its present condition and its sale must be highly probable. A non-current asset (or disposal group) classified as held for sale is measured at the lower of (a) its carrying amount measured in accordance with the applicable Korean IFRS, immediately before the initial classification of the asset (or disposal group) as held for sale and (b) fair value less costs to sell.

A non-current asset while it is classified as held for sale or while it is part of a disposal group classified as held for sale is not depreciated (or amortized).

Impairment loss is recognized for any initial or subsequent write-down of the asset (or disposal group) to fair value less costs to sell. Gain is recognized for any subsequent increase in fair value less costs to sell of an asset, but not in excess of the cumulative impairment loss that has been recognized.

3.13 Financial Liabilities

The Bank classifies financial liabilities into financial liabilities at fair value through profit or loss or other financial liabilities in accordance with the substance of the contractual arrangement and the definitions of financial liabilities. The Bank recognizes financial liabilities in the statement of financial position when the Bank becomes a party to the contractual provisions of the financial liability.

3.13.1 Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading or designated as such at initial recognition. After initial recognition, financial liabilities at fair value through profit or loss are measured at fair value, and changes therein are recognized in profit or loss. At initial recognition, transaction costs that are directly attributable to the acquisition are recognized in profit or loss as incurred.

In relation to securities lending or borrowing transactions, when the Bank borrows securities from the Korea Securities Depository and others, these transactions are managed as off-balance sheet items. The borrowed securities are treated as financial liabilities at fair value through profit or loss when they are sold. Changes in fair value at the end of the reporting period and difference between carrying amount at redemption and purchased amount are recognized in profit or loss.

26

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.13.2 Other financial liabilities

Non-derivative financial liabilities other than financial liabilities at fair value through profit or loss are classified as other financial liabilities. Other financial liabilities include deposits, borrowings, debentures, and others. At initial recognition, other financial liabilities are measured at fair value minus transaction costs that are directly attributable to the acquisition. After initial recognition, other financial liabilities are measured at amortized cost, and its interest expense is recognized, using the effective interest method.

When an asset is sold under repurchase agreement, the Bank continues to recognize the asset with the amount sold being accounted for as borrowings. The Bank derecognizes a financial liability from the statement of financial position only when it is extinguished (i.e., when the obligation specified in the contract is discharged, canceled or expires).

3.14 Provisions

Provisions are recognized when the Bank has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Inevitable risks and uncertainties surrounding related events and circumstances are considered in measuring the best estimate of the provisions, and where the effect of the time value of money is material, the amount of provisions is the present value of the expenditures expected to be required to settle the obligation.

Provisions for confirmed and unconfirmed acceptances and guarantees, and unused credit lines of consumer and corporate loans are recognized using a valuation model that applies the credit conversion factor, PD, and LGD.

Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of resources embodying economic benefits will be required to settle the obligation, the provisions are reversed.

An onerous contract is a contract in which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it. The unavoidable costs under a contract reflect the least net cost of exiting from the contract, which is the lower of the cost of fulfilling it and any compensation or penalties arising from failure to fulfill it. If the Bank has a contract that is onerous, the present obligation under the contract is recognized and measured as provisions.

3.15 Financial Guarantee Contracts

Financial guarantee contracts require the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due in accordance with the original or modified terms of a debt instrument.

Financial guarantee contracts are initially recognized at fair value and classified as other liabilities and are amortized over the contractual term. After initial recognition, financial guarantee contracts are measured at the higher of:

• The amount determined in accordance with Korean IFRS No.1109 Financial Instruments and

• The amount initially recognized less, when appropriate, the cumulative amount of income recognized in accordance with Korean IFRS No.1115 Revenue from Contracts with Customers.

27

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.16 Equity Instrument Issued by the Bank

An equity instrument is any contract or agreement that evidences a residual interest in the assets of an entity after deducting all of its liabilities.

3.16.1 Ordinary shares

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or the exercise of stock option are deducted from the equity, net of any tax effects.

3.16.2 Hybrid securities

The financial instruments can be classified as either financial liabilities or equity in accordance with the terms of the contract. The Bank classifies hybrid securities as an equity if the Bank has the unconditional right to avoid any contractual obligation to deliver cash or another financial asset in relation to the financial instruments.

3.16.3 Compound financial instruments

A compound financial instrument is classified as a financial liability or an equity instrument depending on the substance of the contractual arrangement of such financial instrument. The liability component of the compound financial instrument is measured at fair value of the similar liability without conversion option at initial recognition and subsequently measured at amortized cost using effective interest method until it is extinguished by conversion or matured. Equity component is initially measured at fair value of compound financial instrument in its entirety less fair value of liability component net of tax effect, and it is not remeasured subsequently.

3.17 Revenue Recognition

The Bank recognizes revenues in accordance with the following steps determined in accordance with Korean IFRS No.1115 Revenue from Contracts with Customers.

• Step 1: Identify the contract with a customer.

• Step 2: Identify the performance obligations in the contract.

• Step 3: Determine the transaction price.

• Step 4: Allocate the transaction price to the performance obligations in the contract.

• Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

3.17.1 Interest income and expense

Interest income and expense on debt securities at fair value through profit or loss (excluding beneficiary certificates, equity investments, and other debt instruments), loans, financial instruments at amortized cost, and debt securities at fair value through other comprehensive income are recognized in the statement of comprehensive income using the effective interest method in accordance with Korean IFRS No.1109 Financial Instruments. The effective interest method is a method of calculating the amortized cost of a financial asset or a financial liability and allocating the interest income or interest expense over the relevant period.

28

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

The effective interest rate is the rate that exactly discounts estimated future cash receipts or payments through the expected life of the financial instrument or, where appropriate, a shorter period, to the gross carrying amount of a financial asset or to the amortized cost of a financial liability. When calculating the effective interest rate, the Bank estimates expected cash flows by considering all contractual terms of the financial instrument but does not consider expected credit losses. The calculation includes all fees and points paid (main components of effective interest rate only) or received between parties to the contract that are an integral part of the effective interest rate, transaction costs, and all other premiums or discounts. In those rare cases when it is not possible to reliably estimate the cash flows and the expected life of a financial instrument, the Bank uses the contractual cash flows over the full contractual term of the financial instrument.

Interest income on impaired financial assets is recognized using the interest rate used to discount the expected cash flows for the purpose of measuring the impairment loss. Interest income on debt securities at fair value through profit or loss is also classified as interest income in the statement of comprehensive income.

3.17.2 Fee and commission income

The Bank recognizes financial service fees in accordance with the purpose of charging the fees and the accounting standards of the financial instrument related to the fees earned.

3.17.2.1 Fees that are an integral part of the effective interest of a financial instrument

Such fees are generally treated as adjustments of effective interest rate. Such fees may include compensation for activities such as evaluating the borrower’s financial condition, evaluating and recording guarantees, collateral and other security arrangements, negotiating the terms of the instrument, preparing and processing documents, and closing the transaction and origination fees received on issuing financial liabilities at amortized cost. However, fees relating to the creation or acquisition of a financial instrument at fair value through profit or loss are recognized as revenue immediately.

3.17.2.2 Fees related to performance obligations satisfied over time

If the control of a good or service is transferred over time, the Bank recognizes revenue related to performance obligations over the period of performance obligations. Fees charged in return for the services for a certain period of time, such as asset management fees, consignment business fees, etc. are recognized over the period of performance obligations.

3.17.2.3 Fees related to performance obligations satisfied at a point in time

Fees earned at a point in time are recognized as revenue when a customer obtains controls of a promised good or service and the Bank satisfies a performance obligation.

Commission on negotiation or participation in negotiation for the third party such as trading stocks or other securities, arranging merger and acquisition of business, is recognized as revenue when the transaction has been completed.

If the Bank arranges a syndicated loan but does not participate in the syndicated loan or participates in the syndicated loan with the same effective profit as other participants, a syndication arrangement fee is recognized as revenue at the completion of the syndication service.

29

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.17.3 Net gains or losses on financial instruments at fair value through profit or loss

Net gains or losses on financial instruments at fair value through profit or loss (including changes in fair value, dividends, and gains or losses from foreign currency translation) include gains or losses on financial instruments as follows:

• Gains or losses relating to financial instruments at fair value through profit or loss (excluding interest income using the effective interest rate method)

• Gains or losses relating to derivative financial instruments for trading (including derivative financial instruments for hedging purpose but do not qualify for hedge accounting)

3.17.4 Dividend income

Dividend income is recognized in profit or loss when the right to receive payment is established. Dividend income is recognized as net gains or losses on financial instruments at fair value through profit or loss or other operating income depending on the classification of equity securities.

3.18 Employee Compensation and Benefits

3.18.1 Post-employment benefits

3.18.1.1 Defined contribution plans

When an employee has rendered service to the Bank during a period, the Bank recognizes the contribution payable to a defined contribution plan in exchange for that service as post-employment benefits for the period.

3.18.1.2 Defined benefit plans

All post-employment benefits, other than defined contribution plans, are classified as defined benefit plans. The amount recognized as a net defined benefit liability is the present value of the defined benefit obligation less the fair value of plan assets at the end of the reporting period.

The present value of the defined benefit obligation is calculated annually by a qualified actuary using the projected unit credit method. The rate used to discount post-employment benefit obligations is determined by reference to market yields at the end of the reporting period on high quality corporate bonds. The currency and term of the corporate bonds are consistent with the currency and estimated term of the post-employment benefit obligations. Actuarial gains and losses resulted from changes in actuarial assumptions and experience adjustments are recognized in other comprehensive income.

When the present value of the defined benefit obligation minus the fair value of plan assets results in an asset, it is recognized to the extent of the present value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan.

Past service cost is the change in the present value of the defined benefit obligation for employee service in prior periods, resulting from the introduction or changes to a defined benefit plan. Such past service cost is immediately recognized as an expense for the period.

30

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.18.2 Short-term employee benefits

Short-term employee benefits are employee benefits that are expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related service. When an employee has rendered service to the Bank during an accounting period, the Bank recognizes the undiscounted amount of short-term employee benefits expected to be paid in exchange for that service as an expense for the period.

The expected cost of profit-sharing and bonus payments is recognized as liabilities when the Bank has a present legal or constructive obligation to make payments as a result of past events, such as service rendered by employees, and a reliable estimate of the obligation can be made.

3.18.3 Share-based payment

The Bank provides its executives and employees with stock grants and mileage stock programs. When stock grants are exercised, the Bank can either select to distribute shares of KB Financial Group Inc., the Parent Company or compensate in cash based on the share price. When mileage stock is exercised, the Bank pays the amount equivalent to share price of KB Financial Group Inc. in cash.

For a share-based payment transaction in which the terms of the arrangement provide the Bank with the choice of whether to settle in cash or by issuing equity instruments, the Bank accounts for the transaction in accordance with the requirements applying to cash-settled share-based payment transactions because the Bank determines that it has a present obligation to settle in cash based on a past practice and a stated policy of settling in cash. Therefore, the Bank measures the liability incurred as consideration for the service received at fair value and recognizes related expense and accrued expense over the vesting periods. For mileage stock, the Bank accounts for the transaction in accordance with the requirements applying to cash-settled share-based payment transactions, which are recognized as expense and accrued expenses at the time of vesting.

Until the liability is settled, the Bank remeasures the fair value of the liability at the end of each reporting period and at the date of settlement, with any changes in fair value recognized in profit or loss as share-based payments.

3.18.4 Termination benefits

Termination benefits are payable when employment is terminated by the Bank before the normal retirement date, or an employee’s decision to accept an offer of benefits in exchange for the termination of employment. The Bank recognizes a liability and expense for termination benefits at the earlier of the following dates; when the Bank can no longer withdraw the offer of those benefits and when the Bank recognizes costs for a restructuring that is within the scope of Korean IFRS No.1037 and involves the payment of termination benefits. If the termination benefits are not expected to be settled wholly before twelve months after the end of the annual reporting period, then the termination benefits are discounted to present value.

31

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.19 Income Tax Expense

Income tax expense comprises current tax expense and deferred income tax expense. Current and deferred income tax are recognized as income or expense and included in profit or loss for the period, except to the extent that the tax arises from (a) a transaction or event which is recognized, in the same or a different period, outside profit or loss, either in other comprehensive income or directly in equity and (b) a business combination.

3.19.1 Current income tax

Current income tax is the amount of income tax payable (recoverable) in respect of the taxable profit (tax loss) for a period. A difference between the taxable profit and accounting profit may arise when income or expense is included in accounting profit in one period but is included in taxable profit in a different period. Differences may also arise if there is revenue that is exempt from taxation, or expense that is not deductible in determining taxable profit (loss). Current income tax liabilities for the current and prior periods are measured using the tax rates that have been enacted or substantively enacted by the end of the reporting period.

The Bank offsets current income tax assets and current income tax liabilities if, and only if, the Bank (a) has a legally enforceable right to set off the recognized amounts and (b) intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

3.19.2 Deferred income tax

Deferred income tax is recognized, using the asset-liability method, on temporary differences arising between the tax-based amount of assets and liabilities and their carrying amount in the financial statements. Deferred income tax liabilities are recognized for all taxable temporary differences and deferred income tax assets are recognized for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilized. However, deferred income tax liabilities are not recognized if they arise from the initial recognition of goodwill; deferred income tax assets and liabilities are not recognized if they arise from the initial recognition of an asset or liability in a transaction that is not a business combination, and at the time of the transaction, affects neither accounting nor taxable profit or loss.

The carrying amount of a deferred income tax asset is reviewed at the end of each reporting period. The Bank reduces the carrying amount of a deferred income tax asset to the extent that it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred income tax asset to be utilized.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred income tax liabilities and deferred income tax assets reflects the tax consequences that would follow from the manner in which the Bank expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

The Bank offsets deferred income tax assets and deferred income tax liabilities if, and only if the Bank has a legally enforceable right to set off current income tax assets against current income tax liabilities and the deferred income tax assets and the deferred income tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current income tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred income tax liabilities or assets are expected to be settled or recovered.

32

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

3.19.3 Uncertain tax positions

Uncertain tax positions arise from tax treatments applied by the Bank which may be challenged by the tax authorities due to the complexity of the transaction or different interpretation of the tax laws, such as a claim for rectification, a claim for a refund related to additional tax or a tax investigation by the tax authorities. The Bank recognizes its uncertain tax positions in the financial statements in accordance with Korean IFRS No.1012 and Interpretation of Korean IFRS No.2123. The income tax asset is recognized if a tax refund is probable for taxes levied by the tax authority, and the amount to be paid as a result of the tax investigation and others is recognized as the current tax payable. However, penalty tax and additional refund on tax are regarded as penalty or interest and are accounted for in accordance with Korean IFRS No.1037.

3.20 Transactions with the Trust Accounts

The Bank accounts for trust assets separately from its own assets in accordance with the Financial Investment Services and Capital Markets Act. The borrowings from trust accounts represent transfer of funds in trust accounts into banking accounts. Such borrowings from trust accounts are recorded as receivables from the banking accounts in the trust accounts and as borrowings from trust accounts in the banking accounts. The Bank earns trust fees from the trust accounts for its management of trust assets and operations. The reserves for future profits and losses are set up in the trust accounts for profits and losses related to those trust funds with a guarantee of the principal or of the principal and a certain minimum rate of return in accordance with the relevant laws and regulations applicable to trust operations. The reserves are used to provide for the losses on such trust funds and, if the losses incurred are in excess of the reserves, the excess losses are compensation paid as a loss on trust management in other operating expenses and the trust accounts recognize the corresponding compensation as compensation from banking accounts.

3.21 Lease

The Bank as a lessor recognizes lease payments from operating leases as income on a straight-line basis over the lease term. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying asset and recognized as expense over the lease term on the same basis as lease income. The respective leased assets are included in the statement of financial position based on their nature.

A lessee is required to recognize a right-of-use asset (lease assets) representing its right to use the underlying leased asset and a lease liability representing its obligation to make lease payments. Assets and liabilities arising from a lease are initially measured at the present value.

Lease liabilities include the net present value of the following lease payments:

• Fixed payments (including in-substance fixed payments), less any lease incentives receivable

• Variable lease payments that depend on an index or a rate

• Amounts expected to be payable by the lessee under residual value guarantees

• The exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and

• Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease

The lease payments are discounted using the interest rate implicit in the lease if that rate can be readily determined. If that rate cannot be readily determined, the lessee’s incremental borrowing rate is used, which is the rate of interest that a lessee would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment.

33

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

Right-of-use assets are measured at cost comprising the following:

• The amount of the initial measurement of the lease liability

• Any lease payments made at or before the commencement date, less any lease incentives received

• Any initial direct costs incurred by the lessee, and

• An estimate of restoration costs

However, the Bank can elect not to apply the requirements of Korean IFRS No.1116 to short-term lease (lease that, at the commencement date, has a lease term of 12 months or less) and leases for which the underlying asset is of low value (for example, underlying leased asset under USD 5,000). The Bank applies the exemption of the standard for one time lease of real estate (for training purpose) and leases of low-value assets (underlying assets less than W 5 million or USD 5,000).

The right-of-use asset is depreciated from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.

For sale and leaseback transactions, the Bank applies the requirements of Korean IFRS No.1115 Revenue from Contracts with Customers, to determine whether the transfer of an asset is accounted for as a sale of that asset.

3.22 Operating Segments

The Bank identifies its operating segments based on internal reports which are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance. Segment information includes items which are directly attributable and can be allocated to the segment on a reasonable basis.

34

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4. Financial Risk Management

4.1 Summary

4.1.1 Overview of financial risk management policy

The financial risks that the Bank is exposed to are credit risk, market risk, liquidity risk, operational risk, and others.

This note regarding financial risk management provides information about the risks that the Bank is exposed to and about its objectives, policies, risk assessment and management procedures, and capital management. Additional quantitative information is disclosed throughout the separate financial statements.

The Bank’s risk management system focuses on efficiently supporting long-term strategy and management decisions of each business group through increased risk transparency, spread of risk management culture, prevention of risk transfer between risk types, and preemptive response to rapidly changing financial environments. Credit risk, market risk, liquidity risk, and operational risk are recognized as the Bank’s significant risks and measured and managed by quantifying them in the form of internal capital or Value at Risk (“VaR”) using statistical methods.

4.1.2 Risk management organization

4.1.2.1 Risk Management Committee

The Risk Management Committee, as the ultimate decision-making body, approves risk-related issues, such as establishing risk management strategies in accordance with the strategic direction determined by the board of directors, determining the affordable level of risk appetite, and reviewing the level of risk and the status of risk management activities.

4.1.2.2 Risk Management Council

The Risk Management Council deliberates on and resolves matters delegated by the Risk Management Committee and discusses the details of risk management of the Bank.

4.1.2.3 Risk Management Subcommittees

The Risk Management Subcommittee implements decisions made by the Risk Management Council and makes practical decisions regarding the implementation of risk management policies and procedures.

- Credit Risk Management Subcommittee

The Credit Risk Management Subcommittee conducts deliberation and resolution on new approval of non-standard and compound instruments with embedded credit risks, review of credit risks for new products with credit risks, and establishment of exposure limits by industry.

- Market Risk Management Subcommittee

The Market Risk Management Subcommittee conducts deliberation and resolution on market risk-related matters, such as setting limits on market risk and approving detailed investment standards for new standard, non-standard and compound products.

- Operational Risk Management Subcommittee

The Operational Risk Management Subcommittee reviews the issues that have a significant effect on the Bank’s operational risk such as establishment, amendment and abolition of major system, process and others.

35

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

- Trust & Fund Customer Asset Risk Management Subcommittee

The Trust & Fund Customer Asset Risk Management Subcommittee reviews the issues that have a significant effect on the trust & fund customer asset risk management such as setting limits on trust & fund customer assets.

4.1.2.4 Risk Management Group

The Risk Management Group manages detailed risk management policies, procedures, and business processes.

4.2 Credit Risk

4.2.1 Overview of credit risk

Credit risk is the risk of loss from the portfolio of assets held due to the counterparty’s default, breach of contract, and deterioration of credit quality. For risk management reporting purposes, the Bank considers all factors of credit risk exposure, such as default risk of individual borrowers, country risk, and risk of specific sectors. The Bank defines default as the definition applied to the calculation of Capital Adequacy Ratio under the new Basel Accord (Basel III).

4.2.2 Credit risk management

The Bank measures the expected loss and internal capital for the assets subject to credit risk management, including on-balance and off-balance assets, and uses them as management indicators. The Bank allocates and manages credit risk internal capital limits.

In addition, to prevent excessive concentration of exposures by borrower and industry, the total exposure limit at the Bank level is introduced, applied, and managed to control the credit concentration risk.

All of the Bank’s loan customers (individuals and corporates) are assigned a credit rating and managed by a comprehensive internal credit evaluation system. For individuals, the credit rating is evaluated by utilizing personal information, income and job information, asset information, and bank transaction information. For corporates, the credit rating is evaluated by analyzing and utilizing financial and non-financial information which measures current and future corporate value and ability to repay the debt. Also, the extent to which corporates have the ability to meet debt obligations is comprehensively considered.

The credit rating, once assigned, serves as the fundamental instrument in the Bank’s credit risk management, and is applied in a wide range of credit risk management processes, including credit approval, credit limit management, loan pricing, and assessment of allowances for credit losses. For corporates, the Bank conducts a regular credit evaluation at least once a year, and the review and supervision departments regularly validate the adequacy of credit ratings to manage credit risks.

In order to establish a credit risk management system, the Bank manages credit risk by forming a separate risk management organization. In particular, independently of the Sales Group, the Credit Management & Analysis Group, Retail Customer Group and SME/SOHO Customer Group are in charge of loan policy, loan system, credit rating, credit analysis, follow-up management, and corporate restructuring. The Risk Management Group is responsible for establishing policies on credit risk management, measuring and limiting internal capital of credit risk, setting credit limits, credit review, and verification of credit rating models.

36

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.3 Maximum exposure to credit risk

The Bank’s maximum exposures to credit risk without consideration of collateral values in relation to financial instruments other than equity securities as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Financial assets
Due from financial institutions 1		19,945,791		20,037,543
Financial assets at fair value through profit or loss:
Securities measured at fair value through profit or loss		17,645,808		14,594,689
Loans measured at fair value through profit or loss		280,905		37,382
Due from financial institutions measured at fair value through profit or loss		90,006		113,622
Derivatives		7,747,794		2,960,174
Loans measured at amortized cost 1		363,839,085		349,438,762
Financial investments:
Securities measured at fair value through other comprehensive income		37,760,143		37,477,726
Securities measured at amortized cost 1		34,616,403		21,667,058
Loans measured at fair value through other comprehensive income		231,021		269,609
Other financial assets 1		6,601,913		5,193,409
		488,758,869		451,789,974
Off-balance sheet items 2
Acceptances and guarantees contracts		11,931,683		9,615,887
Financial guarantee contracts		8,903,700		8,571,865
Commitments		108,124,484		96,760,612
		128,959,867		114,948,364
		617,718,736		566,738,338

¹ After netting of allowance

² For details of related provisions, see Note 22.

4.2.4 Credit risk of loans

The Bank maintains allowances for loan losses associated with credit risk of loans to manage its credit risk.

The Bank assesses expected credit losses and recognizes loss allowances of financial assets at amortized cost and financial assets at fair value through other comprehensive income (debt instruments). Financial assets at fair value through profit or loss are excluded. Expected credit losses are a probability-weighted estimate of possible credit losses occurring in a certain range by reflecting reasonable and supportable information that is reasonably available at the end of the reporting period without undue cost or effort, including information about past events, current conditions, and forecasts of future economic conditions. The Bank measures the expected credit losses of loans classified as financial assets at amortized cost, by deducting allowances for credit losses. The expected credit losses of loans classified as financial assets at fair value through other comprehensive income are presented in other comprehensive income in the financial statements.

37

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.4.1 Credit risk exposure

Credit qualities of loans as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
			Non- impaired		Impaired
Loans measured at amortized cost *
Corporate
Grade 1		122,903,840		4,955,573		3,338		—		—		127,862,751
Grade 2		55,954,318		7,617,430		4,422		—		—		63,576,170
Grade 3		2,567,131		2,984,313		4,372		—		—		5,555,816
Grade 4		479,451		795,211		6,576		—		—		1,281,238
Grade 5		11,864		394,372		388,750		—		—		794,986
		181,916,604		16,746,899		407,458		—		—		199,070,961
Retail
Grade 1		153,876,481		3,987,402		10,819		—		—		157,874,702
Grade 2		2,756,890		3,626,799		6,782		—		—		6,390,471
Grade 3		248,891		1,159,886		10,075		—		—		1,418,852
Grade 4		17,204		134,959		2,675		—		—		154,838
Grade 5		14,894		313,447		374,648		—		—		702,989
		156,914,360		9,222,493		404,999		—		—		166,541,852
		338,830,964		25,969,392		812,457		—		—		365,612,813
Loans measured at fair value through other comprehensive income
Corporate
Grade 1		171,194		—		—		—		—		171,194
Grade 2		59,827		—		—		—		—		59,827
Grade 3		—		—		—		—		—		—
Grade 4		—		—		—		—		—		—
Grade 5		—		—		—		—		—		—
		231,021		—		—		—		—		231,021
		231,021		—		—		—		—		231,021
		339,061,985		25,969,392		812,457		—		—		365,843,834

38

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.4.1 Credit risk exposure (cont’d)

(In millions of Korean won)	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
			Non-impaired		Impaired
Loans measured at amortized cost *
Corporate
Grade 1		101,671,881		4,753,592		3,583		—		—		106,429,056
Grade 2		59,923,077		7,313,426		4,321		—		—		67,240,824
Grade 3		1,929,578		2,587,803		2,489		—		—		4,519,870
Grade 4		432,721		879,495		7,484		—		—		1,319,700
Grade 5		12,851		306,029		412,275		—		—		731,155
		163,970,108		15,840,345		430,152		—		—		180,240,605
Retail
Grade 1		157,731,272		4,295,013		10,963		—		—		162,037,248
Grade 2		2,669,894		4,000,518		5,995		—		—		6,676,407
Grade 3		205,486		1,085,997		8,161		—		—		1,299,644
Grade 4		9,055		110,974		3,134		—		—		123,163
Grade 5		7,008		234,986		321,419		—		—		563,413
		160,622,715		9,727,488		349,672		—		—		170,699,875
		324,592,823		25,567,833		779,824		—		—		350,940,480
Loans measured at fair value through other comprehensive income
Corporate
Grade 1		189,872		—		—		—		—		189,872
Grade 2		79,737		—		—		—		—		79,737
Grade 3		—		—		—		—		—		—
Grade 4		—		—		—		—		—		—
Grade 5		—		—		—		—		—		—
		269,609		—		—		—		—		269,609
		269,609		—		—		—		—		269,609
		324,862,432		25,567,833		779,824		—		—		351,210,089

* Before netting of allowance

Credit qualities of loans graded according to internal credit ratings as of December 31, 2022 and 2021, are as follows:

	Corporate	Retail
Grade 1	AAA ~ BBB+	1 ~ 5 grade
Grade 2	BBB ~ BB	6 ~ 8 grade
Grade 3	BB- ~ B	9 ~ 10 grade
Grade 4	B- ~ CCC	11 grade
Grade 5	CC or under	12 grade or under

39

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.4.2 Credit risk mitigation by collateral

Quantification of the extent to which collateral and other credit enhancements mitigate credit risk of loans as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
			Non- impaired		Impaired
Guarantees		99,103,292		7,027,978		177,359		—		—		106,308,629
Deposits and savings		1,697,804		108,318		6,771		—		—		1,812,893
Property and equipment		3,823,241		662,823		3,943		—		—		4,490,007
Real estate		177,110,087		14,209,865		281,535		—		—		191,601,487
		281,734,424		22,008,984		469,608		—		—		304,213,016

(In millions of Korean won)	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
			Non- impaired		Impaired
Guarantees		89,601,071		6,546,538		150,830		—		—		96,298,439
Deposits and savings		1,438,744		88,363		5,477		—		—		1,532,584
Property and equipment		3,863,605		259,387		4,194		—		—		4,127,186
Real estate		170,373,311		12,662,289		270,888		—		—		183,306,488
		265,276,731		19,556,577		431,389		—		—		285,264,697

40

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.5 Credit risk of securities

Credit qualities of securities exposed to credit risk other than equity securities among financial investments as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
			Non- impaired		Impaired
Securities measured at amortized cost *
Grade 1		33,468,589		—		—		—		—		33,468,589
Grade 2		1,153,198		—		—		—		—		1,153,198
Grade 3		—		—		—		—		—		—
Grade 4		—		—		—		—		—		—
Grade 5		—		—		—		—		—		—
		34,621,787				—		—		—		34,621,787
Securities measured at fair value through other comprehensive income
Grade 1		35,232,645		—		—		—		—		35,232,645
Grade 2		2,446,738		—		—		—		—		2,446,738
Grade 3		53,011		9,169		—		—		—		62,180
Grade 4		13,940		4,640		—		—		—		18,580
Grade 5		—		—		—		—		—		—
		37,746,334		13,809		—		—		—		37,760,143
		72,368,121		13,809		—		—		—		72,381,930

(In millions of Korean won)	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Not applying expected credit losses		Total
			Non- impaired		Impaired
Securities measured at amortized cost *
Grade 1		21,202,242		—		—		—		—		21,202,242
Grade 2		460,402		—		—		—		—		460,402
Grade 3		—		7,641		—		—		—		7,641
Grade 4		—		—		—		—		—		—
Grade 5		—		—		—		—		—		—
		21,662,644		7,641		—		—		—		21,670,285
Securities measured at fair value through other comprehensive income
Grade 1		35,185,815		—		—		—		—		35,185,815
Grade 2		2,219,696		—		—		—		—		2,219,696
Grade 3		29,108		3,973		—		—		—		33,081
Grade 4		39,134		—		—		—		—		39,134
Grade 5		—		—		—		—		—		—
		37,473,753		3,973		—		—		—		37,477,726
		59,136,397		11,614		—		—		—		59,148,011

* Before netting of allowance

41

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

Credit qualities of securities other than equity securities, according to the credit ratings by external credit rating agencies as of December 31, 2022 and 2021, are as follows:

Credit quality	Domestic			Foreign
	KIS	NICE P&I	FnPricing Inc.	S&P	Fitch-IBCA	Moody’s
Grade 1	AA0 to AAA	AA0 to AAA	AA0 to AAA	A- to AAA	A- to AAA	A3 to Aaa
Grade 2	A- to AA-	A- to AA-	A- to AA-	BBB- to BBB+	BBB- to BBB+	Baa3 to Baa1
Grade 3	BBB0 to BBB+	BBB0 to BBB+	BBB0 to BBB+	BB to BB+	BB to BB+	Ba2 to Ba1
Grade 4	BB0 to BBB-	BB0 to BBB-	BB0 to BBB-	B+ to BB-	B+ to BB-	B1 to Ba3
Grade 5	BB- or under	BB- or under	BB- or under	B or under	B or under	B2 or under

Credit qualities of debt securities denominated in Korean won are based on the lowest credit rating by the domestic credit rating agencies above, and those denominated in foreign currencies are based on the lowest credit rating by the foreign credit rating agencies above.

4.2.6 Credit risk of due from financial institutions

Credit qualities of due from financial institutions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Total
			Non-impaired		Impaired
Due from financial institutions measured at amortized cost *
Grade 1		19,945,174		—		—		—		19,945,174
Grade 2		644		—		—		—		644
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—
		19,945,818		—		—		—		19,945,818

(In millions of Korean won)	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Credit impaired approach		Total
			Non-impaired		Impaired
Due from financial institutions measured at amortized cost *
Grade 1		20,012,099		—		—		—		20,012,099
Grade 2		1,651		—		—		—		1,651
Grade 3		23,925		—		—		—		23,925
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—
		20,037,675		—		—		—		20,037,675

* Before netting of allowance

The classification criteria of the credit qualities of due from financial institutions as of December 31, 2022 and 2021, are the same as the criteria for securities other than equity securities.

42

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.7 Credit risk mitigation of derivative financial instruments

Quantification of the extent to which collateral mitigates credit risk of derivative financial instruments as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Deposits, savings, securities, and others		2,092,136		424,731

4.2.8 Credit risk concentration analysis

4.2.8.1 Classifications of loans by country as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Retail		Corporate *		Total		%		Allowances			Carrying amount
Korea		166,411,568		182,396,615		348,808,183		95.27		(1,734,857	)		347,073,326
Japan		—		1,150,151		1,150,151		0.31		(1,756	)		1,148,395
United States		—		4,871,778		4,871,778		1.33		(14,867	)		4,856,911
China		—		5,258,447		5,258,447		1.44		(8,885	)		5,249,562
Others		130,284		5,905,896		6,036,180		1.65		(13,363	)		6,022,817
		166,541,852		199,582,887		366,124,739		100.00		(1,773,728	)		364,351,011

(In millions of Korean won)	December 31, 2021
	Retail		Corporate *		Total		%		Allowances			Carrying amount
Korea		170,531,863		168,545,037		339,076,900		96.54		(1,452,104	)		337,624,796
Japan		86		1,082,456		1,082,542		0.31		(2,332	)		1,080,210
United States		—		3,227,026		3,227,026		0.92		(13,976	)		3,213,050
China		—		4,533,168		4,533,168		1.29		(20,971	)		4,512,197
Others		167,926		3,159,908		3,327,834		0.94		(12,335	)		3,315,499
		170,699,875		180,547,595		351,247,470		100.00		(1,501,718	)		349,745,752

* Expected credit losses of loans measured at fair value through other comprehensive income as of December 31, 2022 and 2021, are W 496 million and W 675 million, respectively.

43

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.8.2 Classifications of corporate loans by industry as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Loans *		%		Allowances			Carrying amount
Financial institutions		19,346,929		9.69		(14,398	)		19,332,531
Manufacturing		50,628,397		25.37		(481,647	)		50,146,750
Service		89,946,877		45.07		(279,855	)		89,667,022
Wholesale and retail		26,586,877		13.32		(147,875	)		26,439,002
Construction		3,861,434		1.93		(88,650	)		3,772,784
Public sector		1,488,995		0.75		(3,676	)		1,485,319
Others		7,723,378		3.87		(32,043	)		7,691,335
		199,582,887		100.00		(1,048,144	)		198,534,743

(In millions of Korean won)	December 31, 2021
	Loans *		%		Allowances			Carrying amount
Financial institutions		18,710,348		10.36		(10,396	)		18,699,952
Manufacturing		46,251,923		25.62		(450,371	)		45,801,552
Service		79,044,306		43.78		(229,348	)		78,814,958
Wholesale and retail		23,802,373		13.18		(126,984	)		23,675,389
Construction		2,882,982		1.60		(71,572	)		2,811,410
Public sector		1,563,869		0.87		(4,061	)		1,559,808
Others		8,291,794		4.59		(50,379	)		8,241,415
		180,547,595		100.00		(943,111	)		179,604,484

* Expected credit losses of loans measured at fair value through other comprehensive income as of December 31, 2022 and 2021, are W 496 million and W 675 million, respectively.

4.2.8.3 Classifications of retail loans as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Loans		%		Allowances			Carrying amount
Housing loan		93,209,361		55.97		(135,861	)		93,073,500
General loan		73,332,491		44.03		(589,723	)		72,742,768
		166,541,852		100.00		(725,584	)		165,816,268

(In millions of Korean won)	December 31, 2021
	Loans		%		Allowances			Carrying amount
Housing loan		92,448,330		54.16		(50,222	)		92,398,108
General loan		78,251,545		45.84		(508,385	)		77,743,160
		170,699,875		100.00		(558,607	)		170,141,268

44

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.8.4 Classifications of domestic mortgage loans as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Loans *		%		Allowances			Carrying amount
Group1		15,950,511		16.30		(17,178	)		15,933,333
Group2		35,821,717		36.62		(40,603	)		35,781,114
Group3		35,626,337		36.42		(45,807	)		35,580,530
Group4		10,020,031		10.24		(12,809	)		10,007,222
Group5		399,823		0.41		(618	)		399,205
Group6		11,588		0.01		(74	)		11,514
		97,830,007		100.00		(117,089	)		97,712,918

(In millions of Korean won)	December 31, 2021
	Loans *		%		Allowances			Carrying amount
Group1		16,780,623		17.13		(10,465	)		16,770,158
Group2		39,583,150		40.41		(10,375	)		39,572,775
Group3		31,772,074		32.43		(9,957	)		31,762,117
Group4		9,677,419		9.88		(6,517	)		9,670,902
Group5		140,182		0.14		(273	)		139,909
Group6		10,328		0.01		(87	)		10,241
		97,963,776		100.00		(37,674	)		97,926,102

* Retail loans for general purpose with the real estate as collateral are included.

	Ranges
Group1	LTV 0% to less than 20%
Group2	LTV 20% to less than 40%
Group3	LTV 40% to less than 60%
Group4	LTV 60% to less than 80%
Group5	LTV 80% to less than 100%
Group6	LTV over 100%

* LTV: Loan to Value ratio

45

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.8.5 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by industry as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Finance and insurance		19,945,818		100.00		(27	)		19,945,791
		19,945,818		100.00		(27	)		19,945,791
Securities measured at fair value through profit or loss
Government and government funded institutions		4,174,159		23.66		—			4,174,159
Finance and insurance 1		12,882,794		73.01		—			12,882,794
Others		588,855		3.33		—			588,855
		17,645,808		100.00		—			17,645,808
Derivative financial assets
Government and government funded institutions		56,464		0.73		—			56,464
Finance and insurance 1		7,325,952		94.56		—			7,325,952
Others		365,378		4.71		—			365,378
		7,747,794		100.00		—			7,747,794
Securities measured at fair value through other comprehensive income 2
Government and government funded institutions		14,463,252		38.30		—			14,463,252
Finance and insurance		17,317,355		45.86		—			17,317,355
Others		5,979,536		15.84		—			5,979,536
		37,760,143		100.00		—			37,760,143
Securities measured at amortized cost
Government and government funded institutions		16,369,689		47.28		—			16,369,689
Finance and insurance		17,711,131		51.16		(5,068	)		17,706,063
Others		540,967		1.56		(316	)		540,651
		34,621,787		100.00		(5,384	)		34,616,403
		117,721,350				(5,411	)		117,715,939

46

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.8.5 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by industry as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	December 31, 2021
	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Finance and insurance		20,037,675		100.00		(132	)		20,037,543
		20,037,675		100.00		(132	)		20,037,543
Securities measured at fair value through profit or loss
Government and government funded institutions		2,154,191		14.76		—			2,154,191
Finance and insurance 1		10,882,060		74.56		—			10,882,060
Others		1,558,438		10.68		—			1,558,438
		14,594,689		100.00		—			14,594,689
Derivative financial assets
Government and government funded institutions		6,985		0.24		—			6,985
Finance and insurance 1		2,808,256		94.87		—			2,808,256
Others		144,933		4.89		—			144,933
		2,960,174		100.00		—			2,960,174
Securities measured at fair value through other comprehensive income 2
Government and government funded institutions		12,975,270		34.62		—			12,975,270
Finance and insurance		19,462,711		51.93		—			19,462,711
Others		5,039,745		13.45		—			5,039,745
		37,477,726		100.00		—			37,477,726
Securities measured at amortized cost
Government and government funded institutions		11,963,615		55.21		—			11,963,615
Finance and insurance		9,538,725		44.02		(3,004	)		9,535,721
Others		167,945		0.77		(223	)		167,722
		21,670,285		100.00		(3,227	)		21,667,058
		96,740,549				(3,359	)		96,737,190

¹  Collective investment securities (including transactions with collective investment schemes) are classified as finance and insurance.

²  Expected credit losses of securities measured at fair value through other comprehensive income as of December 31, 2022 and 2021, are W 5,991 million and W 8,111 million, respectively.

47

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.8.6 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by country as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Korea		16,567,043		83.06		—			16,567,043
United States		2,171,613		10.89		(26	)		2,171,587
Others		1,207,162		6.05		(1	)		1,207,161
		19,945,818		100.00		(27	)		19,945,791
Securities measured at fair value through profit or loss
Korea		16,209,344		91.86		—			16,209,344
United States		994,551		5.64		—			994,551
Others		441,913		2.50		—			441,913
		17,645,808		100.00		—			17,645,808
Derivative financial assets
Korea		3,456,882		44.62		—			3,456,882
United States		1,325,575		17.11		—			1,325,575
France		1,281,270		16.54		—			1,281,270
Others		1,684,067		21.73		—			1,684,067
		7,747,794		100.00		—			7,747,794
Securities measured at fair value through other comprehensive income *
Korea		34,586,537		91.60		—			34,586,537
United States		732,183		1.94		—			732,183
Others		2,441,423		6.46		—			2,441,423
		37,760,143		100.00		—			37,760,143
Securities measured at amortized cost
Korea		30,511,462		88.13		(3,746	)		30,507,716
United States		2,740,296		7.91		(949	)		2,739,347
United Kingdom		111,146		0.32		(89	)		111,057
Others		1,258,883		3.64		(600	)		1,258,283
		34,621,787		100.00		(5,384	)		34,616,403
		117,721,350				(5,411	)		117,715,939

48

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.2.8.6 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by country as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	December 31, 2021
	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Korea		16,465,707		82.17		—			16,465,707
United States		2,375,755		11.86		(39	)		2,375,716
Others		1,196,213		5.97		(93	)		1,196,120
		20,037,675		100.00		(132	)		20,037,543
Securities measured at fair value through profit or loss
Korea		12,828,663		87.90		—			12,828,663
United States		1,063,902		7.29		—			1,063,902
Others		702,124		4.81		—			702,124
		14,594,689		100.00		—			14,594,689
Derivative financial assets
Korea		1,060,991		35.84		—			1,060,991
United States		707,545		23.90		—			707,545
France		370,787		12.53		—			370,787
Others		820,851		27.73		—			820,851
		2,960,174		100.00		—			2,960,174
Securities measured at fair value through other comprehensive income *
Korea		34,298,370		91.52		—			34,298,370
United States		556,810		1.49		—			556,810
Others		2,622,546		6.99		—			2,622,546
		37,477,726		100.00		—			37,477,726
Securities measured at amortized cost
Korea		21,250,544		98.06		(2,803	)		21,247,741
United States		76,812		0.35		(106	)		76,706
United Kingdom		157,558		0.73		(141	)		157,417
Others		185,371		0.86		(177	)		185,194
		21,670,285		100.00		(3,227	)		21,667,058
		96,740,549				(3,359	)		96,737,190

* Expected credit loss of securities measured at fair value through other comprehensive income as of December 31, 2022 and 2021, are W 5,991 million and W 8,111 million, respectively.

Due from financial institutions, financial instruments at fair value through profit or loss linked to gold price, and derivative financial instruments are mostly related to the finance and insurance industry with high credit ratings.

49

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.3 Liquidity Risk

4.3.1 Overview of liquidity risk

Liquidity risk is a risk that the Bank becomes insolvent due to the mismatch between the inflow and outflow of funds, unexpected cash outflows, or a risk of loss due to financing funds at a high interest rate or disposing of securities at an unfavorable price due to lack of available funds. The Bank manages its liquidity risk through analysis of the contractual maturity of interest-bearing assets and liabilities, assets and liabilities related to the other inflows and outflows of funds, and off-balance sheet items related to the inflows and outflows of funds such as currency derivative instruments and others.

4.3.2 Liquidity risk management and indicator

The liquidity risk is managed by comprehensive risk management policies and Asset Liability Management (“ALM”) risk management guidelines set forth in these policies that apply to all risk management policies and procedures that may arise throughout the overall business of the Bank.

The Bank establishes a liquidity risk management strategy, including objectives of liquidity risk management, management policies, and internal control systems, and obtains a resolution from the Risk Management Committee. The Risk Management Committee establishes the Risk Management Council for efficient risk management to supervise the establishment and implementation of policies according to risk management strategies.

The Bank calculates and manages Liquidity Coverage Ratio (“LCR”), Net Stable Funding Ratio (“NSFR”), liquidity ratio, maturity mismatch ratio and liquidity stress testing result for all transactions and off-balance transactions, that affect the cash flows in Korean won and foreign currency funds raised and operated for the management of liquidity risks and periodically reports them to the Risk Management Council and the Risk Management Committee.

4.3.3 Analysis of remaining contractual maturity of financial liabilities

The cash flows disclosed in the maturity analysis are undiscounted contractual amounts including principal and future interest payments; as such, amounts in the table below do not match with those in the statements of financial position which are based on discounted cash flows. The future interest payments of floating-rate liabilities are calculated on the assumption that the current interest rate is the same until maturity.

50

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.3.3.1 Remaining contractual maturity of financial liabilities other than derivatives held for cash flow hedge, and off-balance sheet items as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	On demand		Up to 1 month			1-3 months		3-12 months		1-5 years		Over 5 years		Total
Financial liabilities
Financial liabilities at fair value through profit or loss 1		108,862		—			—		—		—		—		108,862
Derivatives held for trading 1		7,189,931		—			—		—		—		—		7,189,931
Derivatives held for hedging 2		—		(558	)		5,312		24,067		66,255		3,502		98,578
Deposits 3		163,687,546		26,775,519			43,396,062		125,156,957		16,327,376		120,331		375,463,791
Borrowings		53,419		17,958,792			5,880,487		12,857,018		6,782,533		1,039,115		44,571,364
Debentures		11,117		1,704,736			3,182,288		12,368,410		7,925,124		4,735,017		29,926,692
Lease liabilities		164		14,140			27,878		105,307		183,763		12,314		343,566
Other financial liabilities		—		13,685,320			465		128,095		—		—		13,813,880
		171,051,039		60,137,949			52,492,492		150,639,854		31,285,051		5,910,279		471,516,664
Off-balance sheet items
Commitments 4		108,124,484		—			—		—		—		—		108,124,484
Acceptances and guarantees contracts		11,931,683		—			—		—		—		—		11,931,683
Financial guarantee contracts 5		8,903,700		—			—		—		—		—		8,903,700
		128,959,867		—			—		—		—		—		128,959,867

(In millions of Korean won)	December 31, 2021
	On demand		Up to 1 month		1-3 months		3-12 months		1-5 years		Over 5 years		Total
Financial liabilities
Financial liabilities at fair value through profit or loss 1		112,698		—		—		—		—		—		112,698
Derivatives held for trading 1		2,698,433		—		—		—		—		—		2,698,433
Derivatives held for hedging 2		—		2,291		5,996		6,589		15,213		1,423		31,512
Deposits 3		195,111,497		13,184,603		28,999,866		106,385,543		8,495,262		183,875		352,360,646
Borrowings		49,783		9,424,878		4,469,503		9,858,812		6,589,299		900,323		31,292,598
Debentures		14,528		660,209		1,252,623		12,523,197		9,152,235		4,703,966		28,306,758
Lease liabilities		139		14,015		26,883		102,646		191,151		13,127		347,961
Other financial liabilities		—		16,932,644		467		118,985		—		—		17,052,096
		197,987,078		40,218,640		34,755,338		128,995,772		24,443,160		5,802,714		432,202,702
Off-balance sheet items
Commitments 4		96,760,612		—		—		—		—		—		96,760,612
Acceptances and guarantees contracts		9,615,887		—		—		—		—		—		9,615,887
Financial guarantee contracts 5		8,571,865		—		—		—		—		—		8,571,865
		114,948,364		—		—		—		—		—		114,948,364

¹ Financial liabilities at fair value through profit or loss and derivatives held for trading are not managed by contractual maturity because they are expected to be traded or redeemed before maturity. Therefore, the carrying amounts of those financial instruments are included in the ‘On demand’ category.

² Cash flows of derivatives held for hedging are shown at net amount of cash inflows and outflows by remaining contractual maturity.

³ Deposits that are contractually repayable on demand or on short notice are included in the ‘On demand’ category.

⁴ Unused lines of credit among commitments are included in the ‘On demand’ category because payments can be requested at any time.

⁵ Cash flows under financial guarantee contracts are classified based on the earliest period that the contract can be executed.

51

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.3.3.2 Contractual cash flows of derivatives held for cash flow hedge as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Up to 1 month		1-3 months		3-12 months		1-5 years		Over 5 years		Total
Cash flow to be received of net-settled derivatives		337		8,038		13,090		49,098		—		70,563
Cash flow to be paid of net-settled derivatives		218		975		1,571		93		—		2,857

(In millions of Korean won)	December 31, 2021
	Up to 1 month		1-3 months		3-12 months		1-5 years		Over 5 years		Total
Cash flow to be received of net-settled derivatives		601		427		2,989		—		—		4,017
Cash flow to be paid of net-settled derivatives		313		2,437		3,238		110		—		6,098

4.4 Market Risk

4.4.1 Concept

Market risk refers to risks that can result in losses due to changes in market factors such as interest rate, stock price, and foreign exchange rate, etc., which arise from securities, derivatives, and others. The most significant risks associated with trading positions are interest rate risk, currency risk, and additional risks include stock price risk. The non-trading position is also exposed to interest rate risk. The Bank manages the market risks by dividing them into those arising from the trading position and those arising from the non-trading position.

4.4.2 Risk management

The Bank sets and monitors internal capital limits for market risk and interest rate risk to manage the risks of trading and non-trading positions. In order to manage market risk efficiently, the Bank maintains risk management systems and procedures such as trading policies and procedures, market risk management guidelines for trading positions, and ALM risk management guidelines for non-trading positions. The entire process is carried out through the approval by the Risk Management Council and the Risk Management Committee of the Bank.

The Bank’s Risk Management Council establishes and enforces overall market risk management policies for market risk management and decides to establish position limits, loss limits, VaR limits, and approves non-standard new products. In addition, the Market Risk Management Subcommittee, chaired by Chief Risk Officer (“CRO”), is a practical decision-making body for market risk management and determines position limits, loss limits, VaR limits, sensitivity limits, and scenario loss limits for each department of the business group.

52

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

The Asset-Liability Management Committee (“ALCO”) determines interest rate and commission operating standards and ALM operation policies and enacts and revises relevant guidelines. The Risk Management Council monitors the establishment and enforcement of ALM risk management policies and enacts and revises ALM risk management guidelines. Interest rate risk limits are set based on future asset and liability positions and expected interest rate volatility, which reflect annual business plans. The ALM Department and the Risk Management Department regularly measure and monitor interest rate risk and report the status and limit of interest rate risk including changes in Economic Value of Equity (“rEVE”), changes in Net Interest Income (“rNII”), and duration gap to the ALCO and the Risk Management Council on a monthly basis, and to the Risk Management Committee on a quarterly basis. To ensure the adequacy of interest rate risk and liquidity risk management, the Risk Management Department assigns the limits, monitors and reviews the procedures and tasks of ALM operations conducted by the ALM department, and reports related matters to the management independently.

The Bank is closely monitoring the outputs of various industry groups and markets that manage the transition to the new interest rate benchmark, including announcements by LIBOR regulation authority and various consultative bodies related to the transition to alternative interest rate. In response to these announcements, the Bank has completed most of the transition and replacement plans according to LIBOR transition programs and plans consisting of major business areas such as finance, accounting, tax, legal, IT, and risk. The program is under the control of the CFO and related matters are reported to the board of directors and consultative bodies with senior management as members. The Bank continues its efforts as a market participant to actively express opinions so that the index interest rate benchmark reform can be carried out in the direction of minimizing the financial and non-financial impacts and operational risks on the Bank and minimizing confusion among stakeholders.

4.4.3 Trading position

4.4.3.1 Definition of a trading position

The trading position, which is subject to market risk management, includes interest rate position and stock position held for short-term trading profit. The Bank also includes and manages all foreign currency positions in our trading positions. The trading position subject to market risk management is the trading position defined in “Trading Policy and Guidelines” and the basic requirements for the trading position are as follows:

• The target position has no restrictions on the sale, and the daily fair value assessment should be made, and the embedded significant risk can be hedged in the market.

• The trading position classification criteria should be clearly defined in the Trading Policy and Guidelines, and the trading position should be managed by a separate trading department.

• The target position must be operated according to the documented trading strategy and the management of position limit must be carried out.

• The specialized dealer or operating department shall have the authority to execute the transaction without prior approval from the Risk Management Department, etc. within the predetermined limits of the target position.

• The target positions should be periodically reported to management for risk management of the Bank.

53

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.4.3.2 Observation method of market risk arising from trading positions

The Bank measures market risk by calculating VaR through the market risk management system for all trading positions. Generally, the Bank manages market risk arising from trading positions at the portfolio level. In addition, the Bank controls and manages the risk of derivative financial instrument transactions in accordance with the Financial Supervisory Service regulations and guidelines.

4.4.3.3 VaR

(a) VaR

The Bank uses the risk-based valuation method (VaR) to measure the market risk of the trading position.

The Bank uses the 10-day VaR, which represents the maximum amount of possible loss of 10 business days based on the historical simulation model of the full valuation method. The distribution of value changes in the portfolio is estimated based on data from the past 250 business days, and 10-day VaR is calculated by the difference between the value of the portfolio at a 99% confidence level of distribution of value changes in the portfolio and the current market value.

VaR is a commonly used market risk measurement technique. However, this approach has some limitations. VaR estimates possible losses under a certain confidence level based on historical market change data. However, since past market changes cannot reflect all future conditions and circumstances, the timing and magnitude of actual losses may vary depending on assumptions in the calculation process. If one day or ten days of the holding period which is generally used for the normal period of liquidating the position, is not sufficient or too long, the VaR result may underestimate or overestimate the potential loss.

When the Bank measures market risk for trading position, it uses an internal model (VaR) for general risk and a standard method for individual risks. Standard method is used if the internal model is not authorized for certain market risk. Therefore, disclosed market risk VaR does not reflect the market risk for individual risks and for some positions.

(b) Back-Testing

To verify the appropriateness of the VaR model, back-testing is performed by comparing actual and hypothetical gains and losses with the VaR calculation results.

54

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

(c) Stress Testing

The Bank carries out stress testing of the trading and available-for-sale portfolio to reflect changes in individual risk factors such as interest rate, stock price, foreign exchange rate, and implied volatility of options that have a significant impact on portfolio value in a crisis. The Bank carries out stress testing through historical and hypothetical scenarios. This stress testing is carried out at least once a quarter.

VaR at a 99% confidence level of interest rate risk, stock price risk, and currency risk for trading positions with a ten-day holding period, excluding Stressed VaR, for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Average		Minimum		Maximum		December 31, 2022
Interest rate risk		17,106		6,548		39,078		25,207
Stock price risk		1		—		85		—
Currency risk		24,972		12,036		46,780		45,307
Diversification effect								(3,936	)
Total VaR		37,629		12,726		73,872		66,578

(In millions of Korean won)	2021
	Average		Minimum		Maximum		December 31, 2021
Interest rate risk		12,720		2,985		41,939		8,061
Stock price risk		—		—		—		—
Currency risk		20,171		9,724		61,020		12,871
Diversification effect								(2,798	)
Total VaR		29,650		8,572		101,110		18,134

The required equity capital using the standard method related to the positions which are not measured by VaR as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)
	December 31, 2022		December 31, 2021
Interest rate risk		12		365
Stock price risk		7		6
Currency risk		117		355
		136		726

55

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.4.3.4 Details of risk factors

(a) Interest rate risk

Interest rate risk for trading positions usually arises from debt securities denominated in Korean won. The Bank’s trading strategy is to gain short-term trading gains from interest rate fluctuations. The Bank manages interest rate risk associated with trading portfolios using VaR and sensitivity analysis (Price Value of a Basis Point: PVBP).

(b) Stock price risk

Stock price risk arises mainly from derivatives linked to stocks positions in the Capital Markets Department. This stock price risk is managed through VaR, sensitivity limits, and others.

(c) Currency risk

Currency risk arises from holding assets and liabilities which are denominated in foreign currency, and currency-related derivatives. Most of the net foreign currency exposures occur in the US dollars and the Chinese Yuan. The Bank also manages net foreign exchange exposures across trading and non-trading portfolios by setting a net foreign currency exposure limit at the same time setting a loss limit.

4.4.4 Non-trading position (Interest Rate Risk of Banking Book (“IRRBB”))

4.4.4.1 Definition of IRRBB

IRRBB is a change in equity and earnings due to the changes in value of interest-sensitive assets and liabilities, etc., and is measured by ΔEVE and ΔNII.

4.4.4.2 The Bank’s overall interest rate risk management and mitigation strategy

The Risk Management Committee approves policies, procedures and limits for managing interest rate risk, and the management department regularly reports on interest rate risk levels of ΔEVE and ΔNII against the set limit, changes in market conditions, and others. In order to measure the sensitivity of the economic value and earnings to changes in interest rates, the Bank calculates monthly interest rate gap and duration gap for assets and liabilities. In addition, the management department conducts an interest rate risk crisis analysis at least once a quarter assuming abnormal interest rate fluctuations and reports the results to the Risk Management Council. Independent internal and external audit department regularly check the process of identifying, measuring and monitoring interest rate risk. The interest rate risk model adequacy test is carried out regularly at least once a year by the verification department independent of the management department.

4.4.4.3 Main modeling assumption used for the Bank’s interest rate risk measurement system for internal management

The Bank separately calculates ΔEVE for internal management of interest rate risk, assuming a historical-simulation based on interest rate volatility during the past financial crisis (FY2008-FY2009), distribution of assets/liabilities portfolio, and 27 interest rate gaps considering management strategy.

56

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.4.4.4 The Bank’s interest rate risk hedging methodology and related accounting

The Bank hedges interest rate risk through back-to-back interest rate swap transactions, which are the same as interest payment cash flows. The Bank officially documents and manages the risk management strategy for hedge accounting, risk management objectives, hedging relationship, and assessment method for hedge effectiveness.

4.4.4.5 Main assumptions used for calculating rEVE, rNII

The Bank calculates interest rate risk, including all cash flow of interest-sensitive assets and liabilities, and off-balance sheet items in the banking book. rEVE assumes a run-off balance sheet where the existing bank account positions are amortized and not replaced by new businesses. In addition, the contractual interest rate, including commercial margins and other spread components, is applied to generate cash flows. When discounting cash flow, rEVE is calculated by applying risk-free interest rate that do not include commercial margins and other spread components.

rNII assumes a constant balance sheet where maturing or repricing cash flows during the target management period are replaced by new cash flows with identical features. The interest rate risk is calculated for the interest rate shock scenario by adding up only if the risk is a loss for each currency. After classifying into retail/transactional, retail/non-transactional, and wholesale according to customers and regular transactions, the average repricing maturity of non-maturity deposits is determined by taking into account proportion of core deposits and cap on average maturity of core deposits for each category. The average repricing maturity of non-maturity deposits is 2.5 years for core deposits, 1 day for non-core deposits, and the longest repricing maturity is five years. The prepayment rate of fixed rate loans and term deposit redemption ratio are estimated by dividing the amount of prepayment amount and redemption amount during the previous month by the balance at the end of the previous month, respectively.

4.4.4.6 rEVE and rNII

The Bank calculates rEVE by applying six interest rate shock and stress scenarios, and rNII is calculated by applying parallel shock up and parallel shock down scenarios. Results as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022				December 31, 2021
	rEVE		rNII		rEVE		rNII
Scenario 1 (Parallel shock up)		—		105,326		643,305		478,400
Scenario 2 (Parallel shock down)		641,269		52,487		183,107		—
Scenario 3 (Short rates down and long rates up)		107,736				121,306
Scenario 4 (Short rates up and long rates down)		235,348				266,778
Scenario 5 (Short rates shock up)		249,114				487,914
Scenario 6 (Short rates shock down)		306,398				565,768
Maximum out of six scenarios		641,269		105,326		643,305		478,400
Basic capital		31,943,522				32,118,160

57

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.4.5 Financial assets and liabilities denominated in foreign currencies

Details of financial instruments denominated in foreign currencies and translated into Korean won as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	USD		JPY		EUR		GBP		CNY		Others		Total
Financial assets
Cash and due from financial institutions		3,785,403		327,255		165,853		39,332		223,494		691,509		5,232,846
Financial assets at fair value through profit or loss		2,044,824		—		355,597		—		—		263,464		2,663,885
Derivatives held for trading		533,788		—		115		10		—		260		534,173
Derivatives held for hedging		193,063		—		—		—		—		290		193,353
Loans measured at amortized cost		28,889,973		683,705		2,360,458		622,702		68,847		1,829,562		34,455,247
Financial assets at fair value through other comprehensive income		4,409,620		—		9,091		5,677		—		826,151		5,250,539
Financial assets at amortized cost		4,045,282		—		—		37,816		—		633,215		4,716,313
Other financial assets		1,615,815		292,283		351,395		23,545		53,775		73,971		2,410,784
		45,517,768		1,303,243		3,242,509		729,082		346,116		4,318,422		55,457,140
Financial liabilities
Derivatives held for trading		271,778		246		182		10		—		—		272,216
Derivatives held for hedging		104,856		—		—		—		—		—		104,856
Deposits		21,610,566		1,230,664		1,380,881		344,585		175,203		1,052,722		25,794,621
Borrowings		18,193,011		458,856		363,990		351,535		195,167		823,579		20,386,138
Debentures		6,939,542		—		2,041,516		—		36,288		288,467		9,305,813
Other financial liabilities		3,362,911		266,315		188,202		13,491		57,583		124,691		4,013,193
		50,482,664		1,956,081		3,974,771		709,621		464,241		2,289,459		59,876,837
Off-balance sheet items		20,895,932		—		262,591		60,382		180,206		134,547		21,533,658

(In millions of Korean won)	December 31, 2021
	USD		JPY		EUR		GBP		CNY		Others		Total
Financial assets
Cash and due from financial institutions		3,911,985		317,082		206,918		49,954		171,638		479,074		5,136,651
Financial assets at fair value through profit or loss		2,305,996		—		349,449		—		—		21,328		2,676,773
Derivatives held for trading		148,078		—		—		—		—		—		148,078
Derivatives held for hedging		82,062		—		—		—		—		90		82,152
Loans measured at amortized cost		23,305,792		583,537		1,546,145		234,612		158,012		1,170,689		26,998,787
Financial assets at fair value through other comprehensive income		5,457,614		5,152		121,573		6,273		—		258,239		5,848,851
Financial assets at amortized cost		706,159		—		—		—		—		—		706,159
Other financial assets		1,386,327		36,398		95,596		6,874		16,844		36,242		1,578,281
		37,304,013		942,169		2,319,681		297,713		346,494		1,965,662		43,175,732
Financial liabilities
Derivatives held for trading		192,455		71		71		—		—		314		192,911
Derivatives held for hedging		42,470		—		—		—		—		—		42,470
Deposits		17,285,631		828,539		1,831,650		106,317		203,271		980,928		21,236,336
Borrowings		13,585,107		456,029		304,678		190,436		7,689		728,591		15,272,530
Debentures		6,026,995		—		1,338,391		—		102,443		83,994		7,551,823
Other financial liabilities		1,514,514		23,141		138,477		15,025		34,049		41,713		1,766,919
		38,647,172		1,307,780		3,613,267		311,778		347,452		1,835,540		46,062,989
Off-balance sheet items		16,904,802		353		217,007		800		117,437		184,824		17,425,223

58

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

4.4.6 Risk management according to interest rate benchmark reform

Details of financial instruments that have not been converted to alternative interest rate benchmark as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022 *				December 31, 2021 *
	USD LIBOR		Others		USD LIBOR		Others
Measured at fair value (non-derivative)
Financial investments at fair value through other comprehensive income		22,800		—		231,702		—
Measured at amortized cost
Loans		1,871,900		—		3,614,592		55,800
Borrowings and debentures		55,800		—		52,162		—
Others
Derivative financial instruments		—		—		1,126,930		—

* Financial instruments to be expired before transition to alternative interest rate benchmark are excluded, and non-derivative financial instruments are the carrying amount and others are the nominal amount.

4.5 Operational Risk

4.5.1 Concept

The Bank defines operational risk as loss risk arising from improper or incorrect internal procedures, personnel, systems or external events and includes financial and non-financial risks.

4.5.2 Risk management

The purpose of operational risk management is not only to comply with supervisory and regulatory requirements, but also to spread risk management culture, strengthen internal control, improve processes, and provide timely feedback to management and all employees. The Bank established a Business Continuity Planning (BCP) to carry out continuous work in emergency situations and established alternative facilities. The Bank conducts simulation training for headquarters and IT departments to check the business continuity framework.

4.6 Capital Management

The Bank complies with the capital adequacy standard established by the financial supervisory authority. This capital adequacy standard is based on Basel III revised by Basel Committee on Banking Supervision in Bank for International Settlements (“BIS”) in June 2011 and was implemented in Korea in December 2013.

According to this standard, the Bank is required to maintain a minimum capital adequacy ratio to risk-weighted assets (Common Equity Tier 1 Capital ratio of 4.5%, Tier 1 Capital ratio of 6.0%, and Total Capital ratio of 8.0%) as of December 31, 2022. Capital Conservation Buffer of 2.5% and Capital Requirement of Domestic Systemically Important Bank (D-SIB) of 1.0% are additionally applied. Therefore, the Bank is required to maintain a capital adequacy ratio including a minimum capital adequacy ratio and additional capital requirements (Common Equity Tier 1 Capital ratio of 8.0% (December 31, 2021: 8.0%), Tier 1 Capital ratio of 9.5% (December 31, 2021: 9.5%), and Total Capital ratio of 11.5% (December 31, 2021: 11.5%)).

59

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

The Bank’s capital is classified into three categories in accordance with the Detailed Regulations on Supervision of Banking Business as follows:

• Common Equity Tier 1 Capital: Common equity Tier 1 Capital is the first to take losses of the Bank and is the last to be compensated in liquidation of the Bank and not repaid except for liquidation. It includes capital, capital surplus, retained earnings, non-controlling interests of the consolidated subsidiaries, accumulated other comprehensive income, and other capital surplus, etc.

• Additional Tier 1 Capital: Additional Tier 1 Capital includes capital, capital surplus, etc. related to the issuance of capital securities of a permanent nature that meets the conditional capital securities requirements.

• Tier 2 Capital: Tier 2 Capital means capital that can compensate for losses of the Bank upon liquidation, including (a) the amount of subordinated bonds with maturity of not less than 5 years that meet the conditional capital securities requirements, and (b) the allowances for credit losses accumulated on the loans which are classified as normal or precautionary in accordance with Regulations on Supervision of Banking Business, and others.

The risk-weighted assets are the magnitude of assets that reflect the risk that the Bank has to bear, including risks inherent in all assets, errors in the operation of internal processes, and risk of loss that may arise from external events. The Bank calculates risk-weighted assets by each risk (credit risk, market risk, and operational risk) based on the Detailed Regulations on Supervision of Banking Business and uses them to calculate capital adequacy ratio. The Bank complied with external capital adequacy requirements as of December 31, 2022 and 2021.

Apart from the capital adequacy ratio, the Bank evaluates and manages capital adequacy through internal policies. The evaluation of capital adequacy compares the size of available capital (the amount of capital actually available) to the size of internal capital (the amount of capital required to cover all the significant risks faced by the Bank under its target credit rating), which monitors financial soundness and provides a risk-adjusted performance measurement basis. The internal capital for capital adequacy assessment is calculated by adding the results of a stress test and other additional capital requirements to the internal capital calculated for each individual risk.

The Risk Management Committee of the Bank determines the risk appetite of the Bank, allocates internal capital by risk type and business group, and each business group operates capital efficiently within the range of the allocated internal capital. The Risk Management Department of the Bank monitors internal capital limit management and reports it to management and the Risk Management Committee. If the limit of internal capital is expected to be exceeded, the Bank’s capital adequacy management is carried out through review and approval by the Risk Management Committee in advance.

60

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

Details of the Bank’s capital adequacy ratio in accordance with Basel III requirements as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Total Capital:		36,232,973		35,572,367
Tier 1 Capital		30,963,124		30,491,173
Common Equity Tier 1 Capital		30,089,274		29,916,650
Additional Tier 1 Capital		873,850		574,523
Tier 2 Capital		5,269,849		5,081,194
Risk-Weighted Assets:		207,557,905		203,569,325
Credit risk 1		182,292,999		181,149,126
Market risk 2		12,611,416		10,833,390
Operational risk 3		12,653,490		11,586,809
Total Capital ratio (%):		17.46		17.47
Tier 1 Capital ratio (%)		14.92		14.98
Common Equity Tier 1 Capital ratio (%)		14.50		14.70

¹ Credit risk weighted assets are measured using the Internal Rating-Based Method and Standard Method.

² Market risk weighted assets are measured using the Internal Model-Based Method and Standard Method.

³ Operational risk weighted assets are measured using the Advanced Measurement Method.

61

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

5. Segment Information

5.1 Overall Segment Information and Business Segments

The Bank is organized into Corporate Banking, Retail Banking and Other Activities. These segments are based on the nature of the products and services provided, the type or class of customer, and the Bank’s management organization.

- Corporate banking: The activities within this segment include providing credit, deposit products, and other related financial services to large, small and medium-sized enterprises and SOHOs.

- Retail banking: The activities within this segment include providing credit, deposit products, and other related financial services to individuals and households.

- Other activities: The activities within this segment include trading activities in securities and derivatives, funding, trust, and other activities.

Financial information by business segment as of and for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Corporate banking			Retail banking			Others			Total
Net operating revenues from external customers		4,505,096			4,472,888			106,624			9,084,608
Net interest income		4,081,306			3,936,872			541,024			8,559,202
Interest income		6,454,562			5,763,852			1,743,608			13,962,022
Interest expense		(2,373,256	)		(1,826,980	)		(1,202,584	)		(5,402,820	)
Net fee and commission income		376,968			261,350			462,508			1,100,826
Fee and commission income		508,605			415,858			587,767			1,512,230
Fee and commission expense		(131,637	)		(154,508	)		(125,259	)		(411,404	)
Net gains on financial instruments at fair value through profit or loss		19,771			—			334,409			354,180
Net other operating income (expenses)		27,051			274,666			(1,231,317	)		(929,600	)
General and administrative expenses		(1,569,009	)		(2,092,770	)		(632,558	)		(4,294,337	)
Operating income before provision for credit losses		2,936,087			2,380,118			(525,934	)		4,790,271
Provision for credit losses		(178,752	)		(281,868	)		(730	)		(461,350	)
Net operating income		2,757,335			2,098,250			(526,664	)		4,328,921
Net non-operating income (expenses)		(8,804	)		—			(363,713	)		(372,517	)
Segment profit before income tax expense		2,748,531			2,098,250			(890,377	)		3,956,404
Income tax expense		(684,402	)		(522,478	)		158,696			(1,048,184	)
Profit for the year		2,064,129			1,575,772			(731,681	)		2,908,220
Total assets *		192,304,445			165,273,848			142,765,182			500,343,475
Total liabilities *		187,559,148			191,786,626			87,443,920			466,789,694

62

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

5.1 Overall Segment Information and Business Segments (cont’d)

(In millions of Korean won)	2021
	Corporate banking			Retail banking			Others			Total
Net operating revenues from external customers		3,102,054			2,958,198			1,793,696			7,853,948
Net interest income		3,272,074			3,541,539			317,702			7,131,315
Interest income		4,202,858			4,437,930			850,054			9,490,842
Interest expense		(930,784	)		(896,391	)		(532,352	)		(2,359,527	)
Net fee and commission income		386,318			392,060			410,254			1,188,632
Fee and commission income		499,928			535,530			536,727			1,572,185
Fee and commission expense		(113,610	)		(143,470	)		(126,473	)		(383,553	)
Net gains on financial instruments at fair value through profit or loss		871			—			352,087			352,958
Net other operating income (expenses)		(557,209	)		(975,401	)		713,653			(818,957	)
General and administrative expenses		(1,436,393	)		(2,036,855	)		(534,420	)		(4,007,668	)
Operating income before provision for credit losses		1,665,661			921,343			1,259,276			3,846,280
Provision for credit losses		(225,798	)		(125,876	)		(4,889	)		(356,563	)
Net operating income		1,439,863			795,467			1,254,387			3,489,717
Net non-operating income (expenses)		(362	)		—			5,757			5,395
Segment profit before income tax expense		1,439,501			795,467			1,260,144			3,495,112
Income tax expense		(395,863	)		(218,753	)		(317,138	)		(931,754	)
Profit for the year		1,043,638			576,714			943,006			2,563,358
Total assets *		170,002,814			169,513,344			125,257,239			464,773,397
Total liabilities *		180,852,527			180,815,013			70,488,256			432,155,796

* Assets and liabilities of the reporting segments are amounts before intersegment transactions.

63

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

5.2 Services and Geographical Segments

5.2.1 Services information

Net operating revenues from external customers by service for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Corporate banking service		4,505,096		3,102,054
Retail banking service		4,472,888		2,958,198
Others		106,624		1,793,696
		9,084,608		7,853,948

5.2.2 Geographical information

Geographical net operating revenues from external customers for the years ended December 31, 2022 and 2021, and major non-current assets as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Net operating revenues from external customers				Major non-current assets
	2022		2021		December 31, 2022		December 31, 2021
Domestic		8,840,358		7,695,778		4,105,598		4,158,441
China		75,120		50,913		1,938		2,835
United States		71,327		37,332		14,485		7,009
New Zealand		12,378		12,857		1,382		1,932
Japan		18,939		17,482		1,480		2,019
United Kingdom		30,430		23,571		5,808		885
Vietnam		25,409		10,185		2,159		2,132
India		1,048		5,830		394		839
Singapore		9,599		—		8,492		—
		9,084,608		7,853,948		4,141,736		4,176,092

64

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6. Financial Assets and Financial Liabilities

6.1 Classification and Fair Value of Financial Instruments

6.1.1 Carrying amount and fair value of financial assets and liabilities by category as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022				December 31, 2021
	Carrying amount		Fair value		Carrying amount		Fair value
Financial assets
Cash and due from financial institutions		22,296,244		22,289,163		22,368,904		22,368,849
Financial assets at fair value through profit or loss:		18,154,550		18,154,550		14,782,128		14,782,128
Debt securities		17,645,808		17,645,808		14,594,689		14,594,689
Equity securities		137,831		137,831		36,435		36,435
Loans		280,905		280,905		37,382		37,382
Others		90,006		90,006		113,622		113,622
Derivatives held for trading		7,509,568		7,509,568		2,829,750		2,829,750
Derivatives held for hedging		238,226		238,226		130,424		130,424
Loans measured at amortized cost		363,839,085		361,359,508		349,438,762		349,337,321
Financial assets at fair value through other comprehensive income:		39,409,618		39,409,618		40,917,071		40,917,071
Debt securities		37,760,143		37,760,143		37,477,726		37,477,726
Equity securities		1,418,454		1,418,454		3,169,736		3,169,736
Loans		231,021		231,021		269,609		269,609
Securities measured at amortized cost		34,616,403		32,797,738		21,667,058		21,382,927
Other financial assets		6,601,913		6,601,913		5,193,409		5,193,409
		492,665,607		488,360,284		457,327,506		456,941,879
Financial liabilities
Financial liabilities at fair value through profit or loss		108,862		108,862		112,698		112,698
Derivatives held for trading		7,189,931		7,189,931		2,698,433		2,698,433
Derivatives held for hedging		104,856		104,856		42,471		42,471
Deposits		368,100,984		367,678,140		349,615,372		349,524,907
Borrowings		43,664,670		43,338,198		31,073,908		30,998,211
Debentures		27,999,416		27,823,582		26,891,141		26,953,355
Other financial liabilities		17,158,325		17,158,325		19,186,687		19,186,687
		464,327,044		463,401,894		429,620,710		429,516,762

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Bank discloses the fair value of each class of assets and liabilities in a way that permits it to be compared with its carrying amount at the end of each reporting period. The best evidence of fair value of financial instruments is a quoted price in an active market.

65

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

Methods of determining fair value of financial instruments are as follows:

Cash and due from financial institutions	Fair value of cash is same as carrying amount. Carrying amount of demand deposit and settlement deposit is a reasonable approximation of fair value because these financial instruments do not have a fixed maturity and are receivable on demand. Fair value of general deposit is measured using Discounted Cash Flow (“DCF”) Model.
Securities Due from financial institutions and deposits indexed to gold price	Fair value of securities and others that are traded in an active market and due from financial institutions and deposits indexed to gold price is determined using the quoted prices. If there is no quoted price, fair value is determined using external professional valuation institutions. The institutions use one or more valuation techniques that are deemed appropriate considering the characteristics of the financial instruments among DCF Model, MonteCarlo Simulation, Free Cash Flow to Equity Model, Comparable Company Analysis, Dividend Discount Model and Net Asset Value Method.
Loans	Fair value of loans is determined using DCF Model and independent external professional valuation institutions. Fair value measured by DCF Model is determined by discounting the expected cash flows, which are contractual cash flows adjusted by the expected prepayment rate, at an appropriate discount rate.
Derivatives	Fair value of exchange traded derivatives is determined using quoted price in an active market, and fair value of OTC derivatives is determined using valuation techniques. The Bank uses internally developed valuation models that are widely used by market participants to determine fair value of plain vanilla OTC derivatives including options, interest rate swaps, and currency swaps, based on observable market parameters. However, some complex financial instruments are valued using appropriate models developed from generally accepted market valuation models including Finite Difference Method (“FDM”), MonteCarlo Simulation, and Tree Model or valuation results from independent external professional valuation institutions. For OTC derivatives, the credit risk of counterparty and the Bank’s own credit risk are applied through credit valuation adjustment method.
Deposits	Carrying amount of demand deposits is a reasonable approximation of fair value because they do not have a fixed maturity and are payable on demand. Fair value of time deposits is determined using DCF Model discounting the expected cash flows, which are contractual cash flows adjusted by the expected prepayment rate, at an appropriate discount rate.
Borrowings	Carrying amount of overdrafts in foreign currency is a reasonable approximation of fair value because they do not have a fixed maturity and are payable on demand. Fair value of other borrowings is determined using DCF Model.
Debentures	Fair value is determined using valuation results (DCF Model) of external professional valuation institutions, which are calculated using market inputs.
Other financial assets and other financial liabilities	Carrying amount is a reasonable approximation of fair value because other financial assets and other financial liabilities are temporary accounts used for other various transactions and their maturities are relatively short or not defined.

66

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.1.2 Fair value hierarchy

The Bank believes that valuation techniques used for measuring the fair value of financial instruments are reasonable and that the fair value recognized in the statement of financial position is appropriate. However, the fair value of the financial instruments recognized in the statement of financial position may be different if other valuation techniques or assumptions are used. Additionally, as there are a variety of valuation techniques and assumptions used in measuring fair value, it may be difficult to reasonably compare the fair value with that of other financial institutions.

The Bank classifies and discloses fair value of the financial instruments into the three fair value levels as follows:

Level 1: The fair values are based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2: The fair values are based on inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3: The fair values are based on unobservable inputs for the asset or liability.

The fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. If an observable input requires an adjustment using an unobservable input and that adjustment results in a significantly higher or lower fair value measurement, the resulting measurement would be categorized within Level 3 of the fair value hierarchy.

67

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.1.2.1 Fair value hierarchy of financial assets and liabilities at fair value in the statements of financial position

Fair value hierarchy of financial assets and liabilities at fair value in the statements of financial position as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Fair value hierarchy
	Level 1		Level 2		Level 3		Total
Financial assets
Financial assets at fair value through profit or loss:		5,380,854		8,401,205		4,372,491		18,154,550
Debt securities		5,290,592		8,401,205		3,954,011		17,645,808
Equity securities		256		—		137,575		137,831
Loans		—		—		280,905		280,905
Others		90,006		—		—		90,006
Derivatives held for trading		—		7,509,535		33		7,509,568
Derivatives held for hedging		—		238,226		—		238,226
Financial assets at fair value through other comprehensive income:		11,379,006		27,225,084		805,528		39,409,618
Debt securities		10,766,080		26,994,063		—		37,760,143
Equity securities		612,926		—		805,528		1,418,454
Loans		—		231,021		—		231,021
		16,759,860		43,374,050		5,178,052		65,311,962
Financial liabilities
Financial liabilities at fair value through profit or loss		108,862		—		—		108,862
Derivatives held for trading		—		7,189,931		—		7,189,931
Derivatives held for hedging		—		104,856		—		104,856
		108,862		7,294,787		—		7,403,649

	December 31, 2021
(In millions of Korean won)	Fair value hierarchy
	Level 1		Level 2		Level 3		Total
Financial assets
Financial assets at fair value through profit or loss:		2,726,982		8,858,390		3,196,756		14,782,128
Debt securities		2,613,360		8,858,390		3,122,939		14,594,689
Equity securities		—		—		36,435		36,435
Loans		—		—		37,382		37,382
Others		113,622		—		—		113,622
Derivatives held for trading		—		2,829,733		17		2,829,750
Derivatives held for hedging		—		130,424		—		130,424
Financial assets at fair value through other comprehensive income:		11,698,251		28,369,785		849,035		40,917,071
Debt securities		9,377,550		28,100,176		—		37,477,726
Equity securities		2,320,701		—		849,035		3,169,736
Loans		—		269,609		—		269,609
		14,425,233		40,188,332		4,045,808		58,659,373
Financial liabilities
Financial liabilities at fair value through profit or loss		112,698		—		—		112,698
Derivatives held for trading		—		2,698,433		—		2,698,433
Derivatives held for hedging		—		42,471		—		42,471
		112,698		2,740,904		—		2,853,602

68

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

Valuation techniques and inputs of financial assets and liabilities classified as Level 2 and measured at fair value in the statements of financial position as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Fair value		Valuation techniques	Inputs
Financial assets
Financial assets at fair value through profit or loss:		8,401,205
Debt securities		8,401,205	DCF Model, MonteCarlo Simulation, Net Asset Value Method	Discount rate, interest rate, prices of underlying assets (debt securities, stocks, etc.)
Derivatives held for trading		7,509,535	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, stock price, and others
Derivatives held for hedging		238,226	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, and others
Financial assets at fair value through other comprehensive income:		27,225,084
Debt securities		26,994,063	DCF Model	Discount rate
Loans		231,021	DCF Model	Discount rate
		43,374,050
Financial liabilities
Derivatives held for trading		7,189,931	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, stock price, and others
Derivatives held for hedging		104,856	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, and others
		7,294,787

(In millions of Korean won)	December 31, 2021
	Fair value		Valuation techniques	Inputs
Financial assets
Financial assets at fair value through profit or loss:		8,858,390
Debt securities		8,858,390	DCF Model, MonteCarlo Simulation, Net Asset Value Method	Discount rate, interest rate, prices of underlying assets (debt securities, stocks, etc.)
Derivatives held for trading		2,829,733	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, stock price, and others
Derivatives held for hedging		130,424	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, and others
Financial assets at fair value through other comprehensive income:		28,369,785
Debt securities		28,100,176	DCF Model	Discount rate
Loans		269,609	DCF Model	Discount rate
		40,188,332
Financial liabilities
Derivatives held for trading		2,698,433	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, stock price, and others
Derivatives held for hedging		42,471	DCF Model, Closed Form, FDM	Discount rate, volatility, foreign exchange rate, and others
		2,740,904

69

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.1.2.2 Fair value hierarchy of financial assets and liabilities whose fair value is disclosed

Fair value hierarchy of financial assets and liabilities whose fair value is disclosed as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Fair value hierarchy
	Level 1		Level 2		Level 3		Total
Financial assets
Cash and due from financial institutions 1		2,350,453		18,768,224		1,170,486		22,289,163
Loans measured at amortized cost		—		—		361,359,508		361,359,508
Securities measured at amortized cost		4,535,667		28,262,071		—		32,797,738
Other financial assets 2		—		—		6,601,913		6,601,913
		6,886,120		47,030,295		369,131,907		423,048,322
Financial liabilities
Deposits 1		—		159,020,380		208,657,760		367,678,140
Borrowings 1		—		18,270		43,319,928		43,338,198
Debentures		—		27,823,582		—		27,823,582
Other financial liabilities 2		—		—		17,158,325		17,158,325
		—		186,862,232		269,136,013		455,998,245

(In millions of Korean won)	December 31, 2021
	Fair value hierarchy
	Level 1		Level 2		Level 3		Total
Financial assets
Cash and due from financial institutions 1		2,331,361		19,531,864		505,624		22,368,849
Loans measured at amortized cost		—		—		349,337,321		349,337,321
Securities measured at amortized cost		2,273,744		19,109,183		—		21,382,927
Other financial assets 2		—		—		5,193,409		5,193,409
		4,605,105		38,641,047		355,036,354		398,282,506
Financial liabilities
Deposits 1		—		191,038,798		158,486,109		349,524,907
Borrowings 1		—		2,146		30,996,065		30,998,211
Debentures		—		26,953,355		—		26,953,355
Other financial liabilities 2		—		—		19,186,687		19,186,687
		—		217,994,299		208,668,861		426,663,160

¹ The amounts included in Level 2 are the carrying amounts which are reasonable approximations of fair value.

² Other financial assets and other financial liabilities included in Level 3 are the carrying amounts which are reasonable approximations of fair value.

For financial assets and liabilities whose carrying amount is a reasonable approximation of fair value, valuation techniques and inputs are not disclosed.

70

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

Valuation techniques and inputs of financial assets and liabilities classified as Level 2, and whose fair value is disclosed as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Fair value		Valuation techniques	Inputs
Financial assets
Securities measured at amortized cost		28,262,071	DCF Model, MonteCarlo Simulation	Discount rate, interest rate
Financial liabilities
Debentures		27,823,582	DCF Model	Discount rate

(In millions of Korean won)	December 31, 2021
	Fair value		Valuation techniques	Inputs
Financial assets
Securities measured at amortized cost		19,109,183	DCF Model, MonteCarlo Simulation	Discount rate, interest rate
Financial liabilities
Debentures		26,953,355	DCF Model	Discount rate

71

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

Valuation techniques and inputs of financial assets and liabilities classified as Level 3, and whose fair value is disclosed as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Fair value		Valuation techniques		Inputs	Unobservable inputs
Financial assets
Cash and due from financial institutions		1,170,486		DCF Model	Credit spread, other spread, interest rate	Credit spread, other spread
Loans measured at amortized cost		361,359,508		DCF Model	Credit spread, other spread, prepayment rate, interest rate	Credit spread, other spread, prepayment rate
		362,529,994
Financial liabilities
Deposits		208,657,760		DCF Model	Other spread, prepayment rate, interest rate	Other spread, prepayment rate
Borrowings		43,319,928		DCF Model	Other spread, interest rate	Other spread
		251,977,688

(In millions of Korean won)	December 31, 2021
	Fair value		Valuation techniques		Inputs	Unobservable inputs
Financial assets
Cash and due from financial institutions		505,624		DCF Model	Credit spread, other spread, interest rate	Credit spread, other spread
Loans measured at amortized cost		349,337,321		DCF Model	Credit spread, other spread, prepayment rate, interest rate	Credit spread, other spread, prepayment rate
		349,842,945
Financial liabilities
Deposits		158,486,109		DCF Model	Other spread, prepayment rate, interest rate	Other spread, prepayment rate
Borrowings		30,996,065		DCF Model	Other spread, interest rate	Other spread
		189,482,174

6.2 Disclosure of Fair Value Hierarchy Level 3

6.2.1 Valuation policy and process of Level 3 fair value

The Bank uses external, independent and qualified valuation service in addition to internal valuation models to determine the fair value of financial instruments at the end of every reporting period.

If the changes in situation and events which cause transfers between the fair value hierarchy level for a financial asset or liability occur, the Bank’s policy is to recognize such transfers as having occurred at the beginning of the reporting period.

72

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.2.2 Changes in fair value (Level 3) measured using valuation technique based on unobservable inputs in the market

6.2.2.1 Changes in financial instruments classified as Level 3 of the fair value hierarchy for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)

	2022
	Financial assets at fair value through profit or loss						Financial investments			Net derivative financial instruments
	Securities measured at fair value through profit or loss			Loans measured at fair value through profit or loss			Equity securities measured at fair value through other comprehensive income			Derivatives held for trading		Derivatives held for hedging
Beginning		3,159,374			37,382			849,035			17		—
Total gains or losses:
- Profit or loss		128,774			(17,617	)		—			16		—
- Other comprehensive loss		—			—			(47,059	)		—		—
Purchases		1,230,764			261,140			4,093			—		—
Sales		(427,326	)		—			(541	)		—		—
Ending		4,091,586			280,905			805,528			33		—

(In millions of Korean won)

	2021
	Financial assets at fair value through profit or loss						Financial investments			Net derivative financial instruments
	Securities measured at fair value through profit or loss			Loans measured at fair value through profit or loss			Equity securities measured at fair value through other comprehensive income			Derivatives held for trading			Derivatives held for hedging
Beginning		2,065,162			38,756			1,917,921			51,646			—
Total gains or losses:
- Profit or loss		141,491			(1,374	)		—			(30,821	)		—
- Other comprehensive loss		—			—			(139,460	)		—			—
Purchases		1,333,191			—			23,507			23,441			—
Sales		(380,470	)		—			(484	)		(44,249	)		—
Transfers out of Level 3		—			—			(952,449	)		—			—
Ending		3,159,374			37,382			849,035			17			—

73

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.2.2.2 In relation to changes in financial instruments classified as Level 3 of the fair value hierarchy, total gains or losses recognized in profit or loss for the period, and total gains or losses recognized in profit or loss from financial instruments held at the end of the reporting period for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Net gains on financial instruments at fair value through profit or loss		Other operating income			Net interest income
Total gains recognized in profit or loss for the period		79,887		31,286			—
Total gains (losses) recognized in profit or loss from financial instruments held at the end of the reporting period		70,945		(17,629	)		—

(In millions of Korean won)	2021
	Net gains on financial instruments at fair value through profit or loss		Other operating income		Net interest income
Total gains recognized in profit or loss for the period		76,283		33,013		—
Total gains recognized in profit or loss from financial instruments held at the end of the reporting period		105,559		32,542		—

74

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.2.3 Sensitivity analysis of changes in unobservable inputs

6.2.3.1 Information about fair value measurements using unobservable inputs as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)
	December 31, 2022
	Fair value		Valuation techniques	Inputs	Unobservable inputs	Range of unobservable inputs (%)	Relationship of unobservable inputs to fair value
Financial assets
Financial assets at fair value through profit or loss:
Debt securities		3,954,011	Net Asset Value Method, DCF Model, Tree Model	Rate of real estate sale price fluctuation, discount rate, liquidation value, stock price, volatility of stock price	Rate of real estate sale price fluctuation	0.00	Higher the real estate sale price, higher the fair value
					Discount rate	8.53	Lower the discount rate, higher the fair value
					Liquidation value	0.00	Higher the liquidation value, higher the fair value
					Volatility of stock price	21.83~34.51	Higher the volatility, higher the fair value fluctuation
Equity securities		137,575	DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method	Growth rate, discount rate	Growth rate	0.00	Higher the growth rate, higher the fair value
					Discount rate	9.16 ~ 15.82	Lower the discount rate, higher the fair value
Loans		280,905	DCF Model	Discount rate	Discount rate	8.11~9.91	Lower the discount rate, higher the fair value
Derivatives held for trading:
Stock and index		33	Tree Model	Price of underlying asset, volatility of underlying asset	Volatility of underlying asset	21.83 ~ 31.73	Higher the volatility, higher the fair value fluctuation
Financial assets at fair value through other comprehensive income:
Equity securities		805,528	DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method, Tree Model	Growth rate, discount rate, stock price, volatility of stock price	Growth rate	0.00 ~ 1.00	Higher the growth rate, higher the fair value
					Discount rate	9.08 ~ 19.14	Lower the discount rate, higher the fair value
					Volatility of stock price	24.88 ~28.62	Higher the volatility, higher the fair value fluctuation
		5,178,052

75

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.2.3.1 Information about fair value measurements using unobservable inputs as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)
	December 31, 2021
	Fair value		Valuation techniques	Inputs	Unobservable inputs	Range of unobservable inputs (%)	Relationship of unobservable inputs to fair value
Financial assets
Financial assets at fair value through profit or loss:
Debt securities		3,122,939	Net Asset Value Method, DCF Model, Tree Model	Rate of real estate sale price fluctuation, discount rate, liquidation value, stock price, volatility of stock price	Rate of real estate sale price fluctuation	0.00	Higher the real estate sale price, higher the fair value
					Discount rate	8.17 ~ 21.37	Lower the discount rate, higher the fair value
					Liquidation value	0.00	Higher the liquidation value, higher the fair value
					Volatility of stock price	19.48	Higher the volatility, higher the fair value fluctuation
Equity securities		36,435	DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method	Growth rate, discount rate	Growth rate	0.00 ~ 1.00	Higher the growth rate, higher the fair value
					Discount rate	10.76 ~ 22.79	Lower the discount rate, higher the fair value
Loans		37,382	DCF Model	Discount rate	Discount rate	8.21	Lower the discount rate, higher the fair value
Derivatives held for trading:
Stock and index		17	Tree Model, DCF Model	Price of underlying asset, volatility of underlying asset	Volatility of underlying asset	17.00 ~ 25.49	Higher the volatility, higher the fair value fluctuation
Financial assets at fair value through other comprehensive income:
Equity securities		849,035	DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method, Tree Model	Growth rate, discount rate, stock price, volatility of stock price	Growth rate	0.00 ~ 1.00	Higher the growth rate, higher the fair value
					Discount rate	10.42 ~ 18.02	Lower the discount rate, higher the fair value
					Volatility of stock price	23.36 ~ 25.49	Higher the volatility, higher the fair value fluctuation
		4,045,808

76

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.2.3.2 Sensitivity analysis of changes in unobservable inputs

Sensitivity analysis of financial instruments is performed to measure favorable and unfavorable changes in fair value of financial instruments which are affected by unobservable parameters, using a statistical technique. When the fair value is affected by more than one input parameter, the amounts represent the most favorable or most unfavorable outcome. Level 3 financial instruments subject to sensitivity analysis are debt securities, loans, equity-related derivatives, currency-related derivatives, interest rate-related derivatives, and other derivatives whose fair value changes are recognized in profit or loss as well as equity securities whose fair value changes are recognized in profit or loss or other comprehensive income or loss.

Results of the sensitivity analysis of changes in unobservable inputs as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Profit or loss					Other comprehensive income or loss
	Favorable changes		Unfavorable changes			Favorable changes		Unfavorable changes
Financial assets
Financial assets at fair value through profit or loss:
Debt securities 3, 5		3,468		(3,467	)		—		—
Equity securities 2, 5		4,609		(3,437	)		—		—
Loans 4		15,396		(14,393	)		—		—
Derivatives held for trading 1		2		(2	)		—		—
Financial assets at fair value through other comprehensive income:
Equity securities 2, 5, 6		—		—			137,984		(56,900	)
		23,475		(21,299	)		137,984		(56,900	)

77

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.2.3.2 Sensitivity analysis of changes in unobservable inputs (cont’d)

(In millions of Korean won)	December 31, 2021
	Profit or loss					Other comprehensive income or loss
	Favorable changes		Unfavorable changes			Favorable changes		Unfavorable changes
Financial assets
Financial assets at fair value through profit or loss:
Debt securities 3, 5		1,847		(1,828	)		—		—
Equity securities 2, 5		3,217		(2,482	)		—		—
Loans 4		3,062		(2,742	)		—		—
Derivatives held for trading 1		2		—			—		—
Financial assets at fair value through other comprehensive income:
Equity securities 2, 5, 6		—		—			87,021		(65,000	)
		8,128		(7,052	)		87,021		(65,000	)

¹  For derivative financial instruments, changes in fair value are calculated by shifting principal unobservable input parameters such as price and the volatility of underlying asset by ± 10%.

₂ For equity securities, changes in fair value are calculated by shifting principal unobservable input parameters such as discount rate (-1%p~1%p) and growth rate (0%p~1%p).

³  For beneficiary certificates, it is practically impossible to analyze sensitivity of changes in unobservable inputs. However, for beneficiary certificates whose underlying assets are real estates, changes in fair value are calculated by shifting rate of real estate sale price fluctuation (-1%p~1%p), and for beneficiary certificates whose underlying assets are equity investments, changes in fair value are calculated by shifting liquidation value (-1%p~1%p) and discount rate (-1%p~1%p). There is no significant correlation among major unobservable inputs.

⁴  For loans, changes in fair value are calculated by shifting principal unobservable input parameters such as discount rate (-1%p~1%p).

⁵  The amounts of \ 3,793,745 million and \ 3,212,082 million of financial assets classified as level 3 as of December 31, 2022 and 2021, respectively, are excluded because it is practically impossible to analyze sensitivity of changes in unobservable inputs.

⁶  For some equity securities, changes in fair value are calculated by shifting principal unobservable input parameters such as stock price and volatility of stock price by ±10%.

6.2.4 Day one gains or losses

When the Bank measures the fair value of OTC derivatives using inputs that are not based on observable market data, there could be a difference between the transaction price and the amount determined using that valuation technique. In these circumstances, the fair value of financial instruments is recognized as the transaction price, and the difference is not recognized in profit or loss but deferred and amortized using the straight-line method over the life of the financial instrument. When the fair value of the financial instruments is subsequently determined using observable market inputs, the remaining deferred amount is recognized in profit or loss. There is no deferred day one gains or losses for the years ended December 31, 2022 and 2021.

78

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.3 Carrying Amount of Financial Instruments by Category

Financial assets and liabilities are measured at fair value or amortized cost. Carrying amount of financial assets and liabilities by category as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Financial instruments at fair value through profit or loss		Financial instruments at fair value through other comprehensive income		Financial instruments designated at fair value through other comprehensive income		Financial instruments at amortized cost		Derivatives held for hedging		Total
Financial assets
Cash and due from financial institutions		—		—		—		22,296,244		—		22,296,244
Financial assets at fair value through profit or loss		18,154,550		—		—		—		—		18,154,550
Derivative financial assets		7,509,568		—		—		—		238,226		7,747,794
Loans measured at amortized cost		—		—		—		363,839,085		—		363,839,085
Financial investments		—		37,991,164		1,418,454		34,616,403		—		74,026,021
Other financial assets		—		—		—		6,601,913		—		6,601,913
		25,664,118		37,991,164		1,418,454		427,353,645		238,226		492,665,607

(In millions of Korean won)	December 31, 2022
	Financial instruments at fair value through profit or loss		Financial instruments at amortized cost		Derivatives held for hedging		Total
Financial liabilities
Financial liabilities at fair value through profit or loss		108,862		—		—		108,862
Derivative financial liabilities		7,189,931		—		104,856		7,294,787
Deposits		—		368,100,984		—		368,100,984
Borrowings		—		43,664,670		—		43,664,670
Debentures		—		27,999,416		—		27,999,416
Other financial liabilities		—		17,158,325		—		17,158,325
		7,298,793		456,923,395		104,856		464,327,044

79

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.3 Carrying Amount of Financial Instruments by Category (cont’d)

(In millions of Korean won)	December 31, 2021
	Financial instruments at fair value through profit or loss		Financial instruments at fair value through other comprehensive income		Financial instruments designated at fair value through other comprehensive income		Financial instruments at amortized cost		Derivatives held for hedging		Total
Financial assets
Cash and due from financial institutions		—		—		—		22,368,904		—		22,368,904
Financial assets at fair value through profit or loss		14,782,128		—		—		—		—		14,782,128
Derivative financial assets		2,829,750		—		—		—		130,424		2,960,174
Loans measured at amortized cost		—		—		—		349,438,762		—		349,438,762
Financial investments		—		37,747,335		3,169,736		21,667,058		—		62,584,129
Other financial assets		—		—		—		5,193,409		—		5,193,409
		17,611,878		37,747,335		3,169,736		398,668,133		130,424		457,327,506

(In millions of Korean won)	December 31, 2021
	Financial instruments at fair value through profit or loss		Financial instruments at amortized cost		Derivatives held for hedging		Total
Financial liabilities
Financial liabilities at fair value through profit or loss		112,698		—		—		112,698
Derivative financial liabilities		2,698,433		—		42,471		2,740,904
Deposits		—		349,615,372		—		349,615,372
Borrowings		—		31,073,908		—		31,073,908
Debentures		—		26,891,141		—		26,891,141
Other financial liabilities		—		19,186,687		—		19,186,687
		2,811,131		426,767,108		42,471		429,620,710

80

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.4 Transfer of Financial Assets

6.4.1 Transferred financial assets that are derecognized in their entirety

The Bank transferred loans and other financial assets to companies specialized in asset-backed securitization and derecognized them from the financial statement, while the maximum exposure to loss (carrying amount) from its continuing involvement and fair value of its continuing involvement of the derecognized financial assets as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Type of continuing involvement	Classification of financial instruments	Carrying amount of continuing involvement		Fair value of continuing involvement
Discovery 2nd Securitization Specialty Co., Ltd.	Subordinated bond	Financial assets at fair value through profit or loss		564		564
AP 4D ABS Ltd.	Subordinated bond	Financial assets at fair value through profit or loss		541		541
				1,105		1,105

(In millions of Korean won)	December 31, 2021
	Type of continuing involvement	Classification of financial instruments	Carrying amount of continuing involvement		Fair value of continuing involvement
Discovery 2nd Securitization Specialty Co., Ltd.	Subordinated bond	Financial assets at fair value through profit or loss		5,189		5,189
AP 4D ABS Ltd.	Subordinated bond	Financial assets at fair value through profit or loss		5,463		5,463
				10,652		10,652

81

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.4.2 Bonds sold under repurchase agreements and loaned securities

The Bank continues to recognize the financial assets related to bonds sold under repurchase agreements and securities lending transactions in the statement of financial position since those transactions are not qualified for derecognition even though the Bank transfers the financial assets. Bonds sold under repurchase agreements are sold on the condition that they will be repurchased at a fixed price and loaned securities will be returned at the expiration of the loan period. Thus, the Bank retains substantially all the risks and rewards of ownership of the financial assets.

The carrying amount of transferred assets and related liabilities as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Carrying amount of transferred assets		Carrying amount of related liabilities
Bonds sold under repurchase agreements		5,342,083		4,816,996
Loaned securities:
Government and public bonds		239,132		—
		5,581,215		4,816,996

(In millions of Korean won)	December 31, 2021
	Carrying amount of transferred assets		Carrying amount of related liabilities
Bonds sold under repurchase agreements		584,579		553,934
Loaned securities:
Government and public bonds		49,816		—
		634,395		553,934

82

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.5 Offsetting Financial Assets and Financial Liabilities

The Bank enters into International Swaps and Derivatives Association (“ISDA”) master netting agreements and other similar arrangements with the Bank’s OTC derivative and spot exchange counterparties. Similar netting agreements are also entered into with the Bank’s (a) sales or purchases of bonds under repurchase agreements and (b) securities lending and borrowing transactions, etc. Pursuant to these agreements, in the event of default by one party, contracts are to be terminated and receivables and payables are to be offset. As the Bank has the legal right of offset and settles in net amount, domestic exchange settlement debits and domestic exchange settlement credits are recognized in its net settlement balance in the statement of financial position. Other financial instruments such as account receivables and account payables related to listed securities, and derivatives or OTC derivatives settled by the central clearing house are also recognized in its net settlement balance in the statement of financial position as the Bank has the legal right of offset and settles in net amount.

6.5.1 Details of financial assets subject to enforceable master netting agreements or similar arrangements as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
			Gross			Net amount in		Non-offsetting amount
	Gross assets		liabilities offset			the statement of financial position		Financial instruments			Cash collateral			Net amount
Derivatives held for trading		7,509,535		—			7,509,535		(6,367,487	)		(826	)		1,379,448
Derivatives held for hedging		238,226		—			238,226
Unsettled spot exchange receivable		3,356,526		—			3,356,526		(3,355,280	)		—			1,246
Bonds purchased under repurchase agreements		2,281,357		—			2,281,357		(2,281,357	)		—			—
Domestic exchange settlement debits		55,446,595		(54,584,853	)		861,742		—			—			861,742
Other financial instruments		20,283		(15,143	)		5,140		—			—			5,140
		68,852,522		(54,599,996	)		14,252,526		(12,004,124	)		(826	)		2,247,576

(In millions of Korean won)

	December 31, 2021
			Gross			Net amount in		Non-offsetting amount
	Gross assets		liabilities offset			the statement of financial position		Financial instruments			Cash collateral			Net amount
Derivatives held for trading		2,829,733		—			2,829,733		(1,809,890	)		(5	)		1,150,262
Derivatives held for hedging		130,424		—			130,424
Unsettled spot exchange receivable		2,351,502		—			2,351,502		(2,349,893	)		—			1,609
Bonds purchased under repurchase agreements		5,468,420		—			5,468,420		(5,468,420	)		—			—
Domestic exchange settlement debits		43,372,672		(42,383,120	)		989,552		—			—			989,552
Other financial instruments		20,728		(20,377	)		351		—			—			351
		54,173,479		(42,403,497	)		11,769,982		(9,628,203	)		(5	)		2,141,774

83

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

6.5.2 Details of financial liabilities subject to enforceable master netting agreements or similar arrangements as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
			Gross			Net amount in		Non-offsetting amount
	Gross liabilities		assets offset			the statement of financial position		Financial instruments			Cash collateral		Net amount
Derivatives held for trading		7,189,931		—			7,189,931		(4,925,362	)		—		2,369,425
Derivatives held for hedging		104,856		—			104,856
Unsettled spot exchange payable		3,356,368		—			3,356,368		(3,355,280	)		—		1,088
Bonds sold under repurchase agreements *		4,835,185		—			4,835,185		(4,835,185	)		—		—
Domestic exchange settlement credits		56,319,757		(54,584,853	)		1,734,904		(1,734,904	)		—		—
Other financial instruments		15,212		(15,143	)		69		—			—		69
		71,821,309		(54,599,996	)		17,221,313		(14,850,731	)		—		2,370,582

(In millions of Korean won)	December 31, 2021
			Gross			Net amount in		Non-offsetting amount
	Gross liabilities		assets offset			the statement of financial position		Financial instruments			Cash collateral		Net amount
Derivatives held for trading		2,698,433		—			2,698,433		(2,018,834	)		—		722,070
Derivatives held for hedging		42,471		—			42,471
Unsettled spot exchange payable		2,350,353		—			2,350,353		(2,349,893	)		—		460
Bonds sold under repurchase agreements *		553,934		—			553,934		(553,934	)		—		—
Domestic exchange settlement credits		47,504,809		(42,383,120	)		5,121,689		(5,121,689	)		—		—
Other financial instruments		23,363		(20,377	)		2,986		—			—		2,986
		53,173,363		(42,403,497	)		10,769,866		(10,044,350	)		—		725,516

* Includes bonds sold under repurchase agreements to customers.

84

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

7. Due from Financial Institutions

7.1 Details of due from financial institutions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		Financial institutions	Interest rate (%)	December 31, 2022		December 31, 2021
Due from financial institutions in Korean won	Due from the Bank of Korea	The Bank of Korea	—		15,169,704		15,317,033
	Due from banks	Hana Bank and others	—		2,374		2,492
					15,172,078		15,319,525
Due from financial institutions in foreign currencies	Due from banks in foreign currencies	The Bank of Korea and others	—		3,598,520		4,214,830
	Time deposits in foreign currencies	Bank of communications, Seoul and others	3.82~6.80		218,094		151,106
	Due from others	Morgan Stanley and others	0.00~6.00		957,126		352,214
					4,773,740		4,718,150
					19,945,818		20,037,675

* Before netting of allowance

7.2 Details of restricted due from financial institutions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		Financial institutions	December 31, 2022		December 31, 2021		Reasons of restriction
Due from financial institutions in Korean won	Due from the Bank of Korea	The Bank of Korea		15,169,704		15,317,033	Bank of Korea Act
Due from financial institutions in foreign currencies	Due from banks in foreign currencies	The Bank of Korea and others		844,287		760,905	Bank of Korea Act and others
	Time deposits in foreign currencies	BANK OF COMMUNICATIONS CO., LTD. NEW YORK Branch		63,365		59,275	New York State Banking Law
	Due from others	STATE STREET BANK AND TRUST COMPANY SEOUL and others		238,660		201,728	Derivatives margin account
				1,146,312		1,021,908
				16,316,016		16,338,941

* Before netting of allowance

85

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

7.3 Changes in allowances for credit losses of due from financial institutions for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	12-month expected			Lifetime expected credit losses
	credit losses			Non-impaired		Impaired
Beginning		132			—		—
Transfer between stages		—			—		—
Provision (reversal) for credit losses		(110	)		—		—
Others (exchange differences, etc.)		5			—		—
Ending		27			—		—

(In millions of Korean won)	2021
	12-month expected		Lifetime expected credit losses
	credit losses		Non-impaired			Impaired
Beginning		38		34			282
Transfer between stages		—		—			—
Provision (reversal) for credit losses		88		(35	)		(282	)
Others (exchange differences, etc.)		6		1			—
Ending		132		—			—

86

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

8. Assets Pledged as Collateral

8.1 Details of assets pledged as collateral as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022
Assets pledged	Pledgee	Carrying amount		Reasons of pledge
Securities measured at fair value through profit or loss	Korea Securities Finance Corporation		34,071	Difference amount of the total limit
	The Bank of Korea		236,833	Settlement risk of the Bank of Korea
			270,904
Securities measured at fair value through other comprehensive income	The Bank of Korea		3,078,859	Repurchase agreements
			5,495,686	Borrowings from the Bank of Korea
			1,782,507	Settlement risk of the Bank of Korea
	MUFGBANK and others		475,265	Derivatives transactions
	UBSAG and others		486,654	Others
			11,318,971
Securities measured at amortized cost	The Bank of Korea and others		1,890,368	Repurchase agreements
	The Bank of Korea		4,020,539	Borrowings from the Bank of Korea
			5,047,277	Settlement risk of the Bank of Korea
	KB Securities Co., Ltd. and others		230,050	Derivatives transactions
	CITI Bank and others		378,416	Others
			11,566,650
Loans	Others		12,863,079	Covered bond and others
			36,019,604

(In millions of Korean won)		December 31, 2021
Assets pledged	Pledgee	Carrying amount		Reasons of pledge
Securities measured at fair value through profit or loss	The Korea Exchange and others		259,487	Repurchase agreements
			259,487
Securities measured at fair value through other comprehensive income	CITI Bank and others		57,693	Repurchase agreements
	The Bank of Korea		2,843,426	Borrowings from the Bank of Korea
			1,249,049	Settlement risk of the Bank of Korea
	JP Morgan Chase Bank and others		590,321	Derivatives transactions
	Others		34,757	Others
			4,775,246
Securities measured at amortized cost	Meritz Securities and others		302,780	Repurchase agreements
	The Bank of Korea		4,847,856	Borrowings from the Bank of Korea
			3,948,622	Settlement risk of the Bank of Korea
	KB Securities Co., Ltd. and others		133,860	Derivatives transactions
	KB Insurance Co., Ltd. and others		121,880	Others
			9,354,998
Mortgage loans	Others		9,659,575	Covered bond and others
			24,049,306

87

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

8.2 Fair value of collateral available to sell or repledge, and collateral sold or repledged, regardless of debtor’s default as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Fair value of collateral held		Fair value of collateral sold or repledged
Securities		2,572,441		—

(In millions of Korean won)	December 31, 2021
	Fair value of collateral held		Fair value of collateral sold or repledged
Securities		5,936,919		—

88

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

9. Derivative Financial Instruments and Hedge Accounting

The Bank engages in derivative trading activities to hedge the interest rate risk and currency risk arising from the Bank’s own assets and liabilities. In particular, the Bank applies fair value hedge accounting using interest rate swaps to hedge the risk of changes in fair value due to the changes in interest rate of structured debentures in Korean won, debentures, structured deposits in foreign currencies, and debt securities at fair value through other comprehensive income. Also, the Bank applies cash flow hedge accounting using interest rate swaps to hedge the risk of changes in cash flows of debentures in foreign currencies, borrowings in foreign currencies, and group of loans measured at amortized cost.

9.1 Details of derivative financial instruments held for trading as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022						December 31, 2021
	Notional amount		Assets		Liabilities		Notional amount		Assets		Liabilities
Interest rate
Forwards		2,765,927		355,407		11,092		738,589		24,928		296
Futures 1		1,626,608		—		—		1,640,283		—		—
Swaps 2		222,419,084		759,599		469,544		200,308,355		302,530		323,095
Options		9,798,000		268,469		265,283		11,657,000		172,060		195,666
		236,609,619		1,383,475		745,919		214,344,227		499,518		519,057
Currency
Forwards		106,889,214		2,537,700		2,346,894		94,195,130		1,211,110		835,405
Futures 1		50,692		—		—		—		—		—
Swaps		93,409,026		3,563,775		4,067,824		65,641,211		1,111,462		1,330,595
Options		2,270,274		24,585		29,294		2,051,034		7,643		13,376
		202,619,206		6,126,060		6,444,012		161,887,375		2,330,215		2,179,376
Stock and index
Options		355		33		—		355		17		—
		355		33		—		355		17		—
Credit
Swaps		—		—		—		13,423		—		—
		—		—		—		13,423		—		—
		439,229,180		7,509,568		7,189,931		376,245,380		2,829,750		2,698,433

¹  Gains or losses arising from daily mark-to-market futures are reflected in the margin accounts.

²  Notional amounts of W 184,555,603 million and W 158,924,418 million as of December 31, 2022 and 2021, respectively, were traded through the central clearing house.

89

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

9.2 Average price conditions of future nominal cash flows by type of hedge accounting as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	1 year		2 years		3 years		4 years		5 years		Over 5 years		Total
Fair value hedge
Nominal amount of the hedging instrument		5,064,802		1,128,620		2,660,326		1,862,039		426,551		2,147,845		13,290,183
Average price condition (%), (CD and LIBOR)		4.17		4.52		4.64		4.56		4.36		4.64		4.43
Cash flow hedge
Nominal amount of the hedging instrument		843,555		226,730		—		—		806,003		—		1,876,288
Average price condition (%), (CD and LIBOR)		4.64		4.06		—		—		5.10		—		4.77

(In millions of Korean won)	December 31, 2021
	1 year		2 years		3 years		4 years		5 years		Over 5 years		Total
Fair value hedge
Nominal amount of the hedging instrument		1,044,669		1,171,185		701,102		2,153,038		1,420,914		2,419,231		8,910,139
Average price condition (%), (CD and LIBOR)		0.94		1.23		1.04		1.16		1.06		1.39		1.18
Cash flow hedge
Nominal amount of the hedging instrument		2,843,325		414,925		—		—		—		—		3,258,250
Average price condition (%), (CD and LIBOR)		0.93		0.76		—		—		—		—		0.91

90

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

9.3 Fair Value Hedge

9.3.1 Details of fair value hedged items as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022										2022
		Carrying amount				Accumulated amount of hedge adjustments						Changes in fair
		Assets		Liabilities		Assets			Liabilities			value
Interest rate	Debt securities in Korean won		2,467,171		—		(107,444	)		—			(86,757	)
	Debt securities in foreign currencies		3,142,972		—		(232,085	)		—			(215,184	)
	Deposits in foreign currencies		—		29,429		—			(8,591	)		6,976
	Debentures in Korean won		—		5,690,371		—			(249,629	)		171,841
	Debentures in foreign currencies		—		1,196,781		—			(95,865	)		123,817
			5,610,143		6,916,581		(339,529	)		(354,085	)		693

(In millions of Korean won)		December 31, 2021										2021
		Carrying amount				Accumulated amount of hedge adjustments						Changes in fair
		Assets		Liabilities		Assets			Liabilities			value
Interest rate	Debt securities in Korean won		1,627,228		—		(20,272	)		—			(21,071	)
	Debt securities in foreign currencies		3,567,662		—		(12,505	)		—			(71,246	)
	Deposits in foreign currencies		—		93,521		—			(1,319	)		3,222
	Debentures in Korean won		—		2,470,123		—			(79,877	)		70,308
	Debentures in foreign currencies		—		1,154,178		—			27,953			45,132
			5,194,890		3,717,822		(32,777	)		(53,243	)		26,345

91

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

9.3.2 Details of derivative instruments designated as fair value hedge as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022						2022
	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		13,290,183		186,258		104,856		(1,245	)

(In millions of Korean won)	December 31, 2021						2021
	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		8,910,139		127,290		38,253		(33,228	)

9.3.3 Details of hedge ineffectiveness recognized in profit or loss on derivative instruments designated as fair value hedge for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Interest rate		(552	)		(6,883	)

9.3.4 Gains or losses on fair value hedging instruments and hedged items attributable to the hedged risk for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Losses on hedging instruments		28,171			(12,657	)
Gains on hedged items attributable to the hedged risk		(28,752	)		13,056
		(581	)		399

9.4 Cash Flow Hedge

9.4.1 Details of cash flow hedged items as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Cash flow hedge reserve					Changes in fair value
	December 31, 2022		December 31, 2021			2022			2021
Interest rate risk		33,921		(89	)		(47,251	)		(11,306	)

92

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

9.4.2 Details of derivative instruments designated as cash flow hedge as of December 31, 2022 and 2021 and changes in fair value for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022						2022
	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		1,876,288		51,968		—		44,064

(In millions of Korean won)	December 31, 2021						2021
	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		3,258,250		3,134		4,218		11,555

9.4.3 Gains on cash flow hedging instruments and hedged items attributable to the hedged risk for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Gains on hedging instruments:		44,064		11,555
Effective portion of gains on cash flow hedging instruments (recognized in other comprehensive income)		43,886		11,468
Ineffective portion of gains on cash flow hedging instruments (recognized in profit)		178		87

9.4.4 Amounts recognized in other comprehensive income and reclassified from equity to profit or loss related to derivative instruments designated as cash allow hedge for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Other comprehensive income		43,886			11,468
Reclassification to profit		2,388			2,303
Income tax effect		(12,264	)		(3,787	)
		34,010			9,984

9.4.5 As of December 31, 2022, the hedged items subject to cash flow hedge are exposed to the risk of changes in cash flows until August 5, 2027.

93

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

9.5 Interest Rate Benchmark Reform

The USD LIBOR interest rate will be replaced by the Secured Overnight Financing Rate (“SOFR”) based on actual transactions. In the case of KRW, the Korean government bond/monetary stabilization bond RP rate has been finally decided as the Risk-Free Reference Rate (“RFR”) and will replace the Certificate of Deposit (“CD”) rate in the mid to long-term. Within the corresponding hedging relationship of related significant interest rate benchmark, the Bank assumed that the spread to be changed on the RFR basis including SOFR would be similar to that included in the interest rate swap used as a hedging instrument, and no other changes were assumed.

Details of the Bank’s exposure to hedging relationships related to the interest rate benchmark reform as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won and millions of US dollars)		December 31, 2022
Interest rate benchmark	Currency	Carrying amount of non-derivative assets		Carrying amount of non-derivative liabilities		Notional amount of hedging instruments
CD#3M	KRW		3,060,791		5,690,371		6,440,000
USD#LIBOR#3M	USD		1,895		1,257		3,478
USD#LIBOR#6M	USD		167		—		182

(In millions of Korean won and millions of US dollars)		December 31, 2021
Interest rate benchmark	Currency	Carrying amount of non-derivative assets		Carrying amount of non-derivative liabilities		Notional amount of hedging instruments
CD#3M	KRW		3,123,388		2,470,123		5,690,000
USD#LIBOR#3M	USD		2,695		2,154		4,386
USD#LIBOR#6M	USD		224		—		225

94

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

10. Loans Measured at Amortized Cost

10.1 Details of loans as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Loans		365,118,018			350,369,299
Deferred loan origination fees and costs		494,795			571,181
Less: Allowances for credit losses		(1,773,728	)		(1,501,718	)
		363,839,085			349,438,762

10.2 Details of loans to banks as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Loans		12,027,410			10,103,076
Less: Allowances for credit losses		(2,881	)		(691	)
		12,024,529			10,102,385

10.3 Details of loan types and customer types of loans to customers other than banks as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Retail			Corporate			Total
Loans in Korean won		166,411,567			159,709,016			326,120,583
Loans in foreign currencies		130,285			16,482,236			16,612,521
Domestic import usance bills		—			4,499,072			4,499,072
Off-shore funding loans		—			963,709			963,709
Call loans		—			100,000			100,000
Bills bought in Korean won		—			860,767			860,767
Bills bought in foreign currencies		—			1,777,661			1,777,661
Guarantee payments under acceptances and guarantees		—			2,083			2,083
Bonds purchased under repurchase agreements		—			2,281,357			2,281,357
Privately placed bonds		—			367,650			367,650
		166,541,852			187,043,551			353,585,403
Proportion (%)		47.10			52.90			100.00
Less: Allowances for credit losses		(725,584	)		(1,045,263	)		(1,770,847	)
		165,816,268			185,998,288			351,814,556

95

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

10.3 Details of loan types and customer types of loans to customers other than banks as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	December 31, 2021
	Retail			Corporate			Total
Loans in Korean won		170,531,863			146,579,750			317,111,613
Loans in foreign currencies		168,012			11,797,445			11,965,457
Domestic import usance bills		—			3,311,142			3,311,142
Off-shore funding loans		—			1,135,753			1,135,753
Call loans		—			735,565			735,565
Bills bought in Korean won		—			2,209			2,209
Bills bought in foreign currencies		—			1,999,449			1,999,449
Guarantee payments under acceptances and guarantees		—			3,060			3,060
Bonds purchased under repurchase agreements		—			4,368,420			4,368,420
Privately placed bonds		—			204,736			204,736
		170,699,875			170,137,529			340,837,404
Proportion (%)		50.08			49.92			100.00
Less: Allowances for credit losses		(558,607	)		(942,420	)		(1,501,027	)
		170,141,268			169,195,109			339,336,377

10.4 Changes in deferred loan origination fees and costs for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Beginning		Increase		Decrease			Others			Ending
Deferred loan origination costs
Loans in Korean won		583,477		243,913		(305,106	)		—			522,284
Others		168		550		(343	)		4			379
		583,645		244,463		(305,449	)		4			522,663
Deferred loan origination fees
Loans in Korean won		10,076		23,067		(9,104	)		—			24,039
Loans in foreign currencies and others		2,389		8,432		(6,998	)		6			3,829
		12,465		31,499		(16,102	)		6			27,868
		571,180		212,964		(289,347	)		(2	)		494,795

(In millions of Korean won)	2021
	Beginning		Increase		Decrease			Others			Ending
Deferred loan origination costs
Loans in Korean won		590,063		327,891		(334,478	)		1			583,477
Others		569		51		(451	)		(1	)		168
		590,632		327,942		(334,929	)		—			583,645
Deferred loan origination fees
Loans in Korean won		6,998		5,479		(2,400	)		(1	)		10,076
Loans in foreign currencies and others		3,341		108		(1,063	)		2			2,388
		10,339		5,587		(3,463	)		1			12,464
		580,293		322,355		(331,466	)		(1	)		571,181

96

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

11. Allowances for Credit Losses

11.1 Changes in allowances for credit losses of loans for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)

	2022
	Retail											Corporate
	12-month expected			Lifetime expected credit losses						Credit		12-month expected			Lifetime expected credit losses						Credit
	credit losses			Non- impaired			Impaired			impaired approach		credit losses			Non- impaired			Impaired			impaired approach
Beginning		288,395			164,845			105,367			—		321,650			426,492			194,969			—
Transfer between stages:
Transfer to 12-month expected credit losses		115,382			(115,348	)		(34	)		—		120,159			(119,860	)		(299	)		—
Transfer to lifetime expected credit losses (non-impaired)		(94,126	)		99,854			(5,728	)		—		(91,116	)		114,517			(23,401	)		—
Transfer to lifetime expected credit losses (impaired)		(705	)		(38,984	)		39,689			—		(1,122	)		(37,983	)		39,105			—
Write-offs		—			(1	)		(213,834	)		—		—			(3	)		(146,176	)		—
Sales		(805	)		(137	)		(289	)		—		—			(58	)		(14,064	)		—
Provision for credit losses 1, 2		108,306			84,778			189,369			—		17,858			118,015			127,171			—
Others (exchange differences, etc.)		(99	)		20			(331	)		—		2,163			1,355			(1,228	)		—
Ending		416,348			195,027			114,209			—		369,592			502,475			176,077			—

97

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

11.1 Changes in allowances for credit losses of loans for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)

	2021
	Retail											Corporate
	12-month expected			Lifetime expected credit losses						Credit		12-month expected			Lifetime expected credit losses						Credit
	credit losses			Non-impaired			Impaired			impaired approach		credit losses			Non-impaired			Impaired			impaired approach
Beginning		245,556			165,318			110,868			—		262,271			340,023			264,864			—
Transfer between stages:
Transfer to 12-month expected credit losses		111,827			(111,786	)		(41	)		—		79,615			(61,021	)		(18,594	)		—
Transfer to lifetime expected credit losses (non-impaired)		(88,697	)		95,807			(7,110	)		—		(65,533	)		82,741			(17,208	)		—
Transfer to lifetime expected credit losses (impaired)		(673	)		(38,384	)		39,057			—		(1,054	)		(32,254	)		33,308			—
Write-offs		—			12			(227,690	)		—		—			(4	)		(163,698	)		—
Sales		(1,100	)		(33	)		(975	)		—		(5	)		—			(15,662	)		—
Provision for credit losses 1, 2		22,585			54,002			192,554			—		42,812			98,242			120,880			—
Others (exchange differences, etc.)		(1,103	)		(91	)		(1,296	)		—		3,544			(1,235	)		(8,921	)		—
Ending		288,395			164,845			105,367			—		321,650			426,492			194,969			—

¹ Provision (reversal) for credit losses in the statements of comprehensive income also includes provision (reversal) for credit losses of unused commitments, acceptances and guarantees (Note 22.2), provision (reversal) for credit losses of financial guarantee contracts (Note 22.4), provision (reversal) for credit losses of other financial assets (Note 18.2), provision (reversal) for credit losses of due from financial institutions (Note 7.3) and provision (reversal) for credit losses of debt securities (Note 12.5).

² Includes W 223,355 million and W 222,227 million of collections from written-off loans for the years ended December 31, 2022 and 2021, respectively.

The Bank manages the written-off loans that their legal extinctive prescriptions have not been completed, and that have not been collected. The balances of those loans are W 7,037,343 million and W 7,551,517 million as of December 31, 2022 and 2021, respectively.

98

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

11.2 Changes in gross carrying amount of loans for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	12-month			Lifetime expected credit losses						Credit
	expected credit losses			Non- impaired			Impaired			impaired approach
Beginning		324,592,824			25,567,832			779,824			—
Transfer between stages:
Transfer to 12-month expected credit losses		33,342,008			(33,283,109	)		(58,899	)		—
Transfer to lifetime expected credit losses (non-impaired)		(36,557,245	)		36,905,018			(347,773	)		—
Transfer to lifetime expected credit losses (impaired)		(251,387	)		(1,228,003	)		1,479,390			—
Write-offs		—			(4	)		(360,010	)		—
Sales		(2,449,296	)		(13,615	)		(129,128	)		—
Net increase (decrease) (execution, repayment, and others)		20,154,062			(1,978,727	)		(550,949	)		—
Ending		338,830,966			25,969,392			812,455			—

(In millions of Korean won)	2021
	12-month			Lifetime expected credit losses						Credit
	expected credit losses			Non- impaired			Impaired			impaired approach
Beginning		294,886,513			23,229,852			946,202			—
Transfer between stages:
Transfer to 12-month expected credit losses		29,523,996			(29,447,432	)		(76,564	)		—
Transfer to lifetime expected credit losses (non-impaired)		(34,197,063	)		34,611,267			(414,204	)		—
Transfer to lifetime expected credit losses (impaired)		(284,649	)		(1,192,440	)		1,477,089			—
Write-offs		—			8			(391,388	)		—
Sales		(2,755,184	)		(7,780	)		(136,052	)		—
Net increase (decrease) (execution, repayment, and others)		37,419,211			(1,625,643	)		(625,259	)		—
Ending		324,592,824			25,567,832			779,824			—

99

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

12. Financial Assets at Fair Value through Profit or Loss and Financial Investments

12.1 Details of financial assets at fair value through profit or loss and financial investments as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Financial assets at fair value through profit or loss
Debt securities:
Government and public bonds		4,084,362			2,044,994
Financial bonds		5,287,488			5,500,948
Corporate bonds		145,007			501,013
Beneficiary certificates		6,666,088			5,617,259
Investment funds		528,795			378,712
Other debt securities		934,068			551,763
Equity securities:
Stocks		137,831			36,435
Loans:
Other loans		280,905			37,382
Others:
Financial instruments indexed to the price of gold		90,006			113,622
		18,154,550			14,782,128
Financial investments
Financial assets at fair value through other comprehensive income
Debt securities:
Government and public bonds		7,672,296			5,569,123
Financial bonds		17,079,749			18,680,309
Corporate bonds		12,603,246			12,445,893
Asset-backed securities		237,605			782,401
Other debt securities		167,247			—
Equity securities:
Stocks		1,402,899			3,144,066
Equity investments		15,555			25,670
Loans:
Privately placed bonds		231,021			269,609
		39,409,618			40,917,071
Financial assets at amortized cost
Debt securities:
Government and public bonds		6,520,633			5,742,285
Financial bonds		10,315,697			2,879,015
Corporate bonds		10,026,039			6,358,169
Asset-backed securities		7,395,434			6,659,710
Other debt securities		363,984			31,106
Less: Allowances for credit losses		(5,384	)		(3,227	)
		34,616,403			21,667,058
		74,026,021			62,584,129

100

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

12.2 Dividend income from equity securities designated at fair value through other comprehensive income for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		2022				2021
		From the equity securities derecognized		From the equity securities held		From the equity securities derecognized		From the equity securities held
Stocks	Listed		—		409		7,106		300
	Unlisted		—		9,476		372		10,104
			—		9,885		7,478		10,404

12.3 Derecognized equity securities measured at fair value through other comprehensive income for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		2022				2021
		Disposal price*		Accumulated other comprehensive loss as of disposal date		Disposal price *		Accumulated other comprehensive income as of disposal date
Stocks	Listed		425,736		335,203		575,288		(319,162	)
	Unlisted		—		—		458		(162	)
			425,736		335,203		575,746		(319,324	)

* The stocks were disposed of according to the stock price increase and joint sale resolution.

12.4 Provision (reversal) for credit losses of financial investments for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Provision		Reversal			Total
Financial assets at fair value through other comprehensive income		1,666		(3,462	)		(1,796	)
Securities measured at amortized cost		2,771		(613	)		2,158
		4,437		(4,075	)		362

(In millions of Korean won)	2021
	Provision		Reversal			Total
Financial assets at fair value through other comprehensive income		6,156		(330	)		5,826
Securities measured at amortized cost		1,604		(551	)		1,053
		7,760		(881	)		6,879

101

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

12.5 Changes in allowances for credit losses of financial investments for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	12-month expected			Lifetime expected credit losses
	credit losses			Non-impaired			Impaired
Beginning		11,985			27			—
Transfer between stages:
Transfer to 12-month expected credit losses		—			—			—
Transfer to lifetime expected credit losses		—			—			—
Sales		(612	)		(20	)		—
Provision (reversal) for credit losses		99			263			—
Others (exchange differences, etc.)		129			—			—
Ending		11,601			270			—

(In millions of Korean won)	2021
	12-month expected			Lifetime expected credit losses
	credit losses			Non-impaired			Impaired
Beginning		6,715			39			—
Transfer between stages:
Transfer to 12-month expected credit losses		—			—			—
Transfer to lifetime expected credit losses		—			—			—
Sales		(1,722	)		(4	)		—
Provision (reversal) for credit losses		6,891			(12	)		—
Others (exchange differences, etc.)		101			4			—
Ending		11,985			27			—

102

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13. Investments in Associates and Subsidiaries

13.1 Details of investments in associates and subsidiaries as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
(In thousands of US dollars) (In hundred millions of Indonesian rupiah)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
Associates
Korea Credit Bureau Co., Ltd. 1		9.00		4,500		4,959			2,769	Credit information	Korea
Incheon Bridge Co., Ltd. 1		14.99		9,159		(15,963	)		9,159	Operation of highways and related facilities	Korea
KB SPROTT Renewable Private Equity Fund No.1		30.00		14,361		13,165			14,361	Investment finance	Korea
KB Digital Innovation & Growth New Technology Business Investment Fund		45.00		4,500		4,038			4,500	Discovery of and investment in promising FinTech-business venture	Korea
KB Digital Platform Fund		46.67		26,600		25,357			26,600	Digital platform and Tech-based investment in promising companies	Korea
KB Prime Digital Platform Fund		43.33		2,600		2,563			2,600	Digital platform and Tech-based investment in promising companies	Korea
Future Planning KB Start-up Creation Fund		50.00		2,200		9,793			2,200	Investment finance	Korea
KB High-tech Company Investment Fund		50.00		1,500		10,662			1,500	Investment finance	Korea
Aju Good Technology Venture Fund		38.47		8,144		19,840			8,144	Investment finance	Korea
KB-KDBC Pre-IPO New Technology Business Investment Fund		33.33		1,800		2,989			1,800	Investment finance	Korea
KB-TS Technology Venture Private Equity Fund		30.00		5,220		7,390			5,220	Investment finance	Korea
KB Intellectual Property Fund No.2		37.50		15,000		15,204			15,000	Investment finance	Korea
KB Digital Innovation Investment Fund Limited Partnership		25.74		35,000		34,693			35,000	Investment finance	Korea
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		21.28		6,600		8,901			6,600	Investment finance	Korea
KB Global Platform Fund		22.73		43,850		50,366			43,850	Investment finance	Korea
KB-UTC Inno-Tech Venture Fund		29.53		14,250		12,786			14,250	Investment finance	Korea
WJ Private Equity Fund No.1		26.95		10,000		9,542			10,000	Investment finance	Korea
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		28.57		10,000		8,380			10,000	Investment finance	Korea
KB Smart Scale Up Fund		25.00		43,000		40,288			43,000	Investment finance	Korea
KB Scale Up Fund II		20.00		4,500		4,438			4,500	Investment finance	Korea
KB Bio Global Expansion Private Equity Fund No.1		26.32		10,000		10,519			10,000	Investment finance	Korea
KB-KTB Technology Venture Fund		27.27		9,000		8,709			9,000	Investment finance	Korea
KB-SOLIDUS Healthcare Investment Fund		29.41		6,600		6,217			6,600	Investment finance	Korea

103

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates and subsidiaries as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	December 31, 2022
(In thousands of US dollars) (In hundred millions of Indonesian rupiah)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
KB New Deal Innovation Fund		20.00		13,600		13,241			13,600	Investment finance	Korea
All Together Korea Fund No.2 2		99.99		10,000		10,244			10,000	Asset management	Korea
Shinla Construction Co., Ltd. 3		20.17		—		(551	)		—	Specialty construction	Korea
Terra Corporation 3		24.06		—		2			—	Manufacture of fabricated and processed metal products	Korea
MJT&I Corp. 3		22.89		—		(882	)		—	Wholesale of other merchandise	Korea
Jungdong Steel Co., Ltd. 3		42.65		—		(433	)		—	Wholesale of primary metal	Korea
DSMETAL Co., Ltd. 3		26.49		—		(101	)		—	Manufacture of metal door, windows, shutter and relevant products	Korea
Shinhwa Underwear Co., Ltd. 3		26.05		—		(73	)		—	Manufacture of underwear and sleepwear	Korea
Jaeyang Industry Co., Ltd. 3		20.86		—		(552	)		—	Manufacture of luggage and other protective cases	Korea
Kendae Co., Ltd. 3		41.01		—		(252	)		—	Screen printing	Korea
Jinseung Tech Co., Ltd. 3		30.04		—		(191	)		—	Manufacture of other general-purpose machinery	Korea
Dongjo Co., Ltd. 3		29.29		—		(5	)		—	Wholesale of agricultural and forestry machinery and equipment	Korea
Korea NM Tech Co., Ltd. 3		22.41		—		549			—	Manufacture of motor vehicles, trailers and semitrailers	Korea
Jungdo Co., Ltd. 3		25.34		—		1,112			—	Office, commercial and institutional building construction	Korea
Dae-A Leisure Co., Ltd. 3		49.36		—		523			—	Earth works	Korea
Chongil Machine & Tools Co., Ltd. 3		20.40		—		(178	)		—	Wholesale of machinery and equipment	Korea
Imt Technology Co., Ltd. 3		25.29		—		34			—	Computer Peripherals Distribution	Korea
Iwon Alloy Co., Ltd. 3		23.20		—		374			—	Manufacture of smelting, refining and alloys	Korea
Computerlife Co., Ltd. 3		25.41		—		(130	)		—	Publishing of magazines and periodicals (publishing industry)	Korea
Skydigital Inc. 3		20.40		—		(318	)		—	Manufacture of multimedia and video devices	Korea
Jo Yang Industrial Co., Ltd. 3		22.77		—		(36	)		—	Manufacture of special glass	Korea
Il-Kwang Electronic Materials Co., Ltd. 3		29.06		—		(555	)		—	Manufacture of electronic parts	Korea
So-Myung Recycling Co., Ltd. 3		20.23		—		246			—	Manufacture of nonferrous metal	Korea

104

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates and subsidiaries as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	December 31, 2022
(In thousands of US dollars) (In hundred millions of Indonesian rupiah)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
IDTECK Co., Ltd. 3		20.54		—		42			—	Other manufacturing of wireless telecommunications equipment		Korea
PIP System Co., Ltd. 3		20.72		—		27			—	Print equipment		Korea
Gwang Myung Paper Co., Ltd. 3		20.54		—		84			—	Wholesale of luggage and other protective cases		Korea
D-Partner 3		20.94		—		832			—	Backlight film		Korea
Inter Shipping Co., Ltd. 3		42.09		—		(1,038	)		—	Sea freight water transport		Korea
Chunsung-meat Co., Ltd. 3		26.74		—		246			—	Wholesale of meat		Korea
DS Fashionbiz Co., Ltd. 3		47.64		—		(1	)		—	Manufacture of textiles		Korea
ALTSCS Co., Ltd. 3		47.11		—		408			—	Manufacture of motor vehicle parts		Korea
E-Won Chemical Co., Ltd. 3		24.30		—		35			—	Manufacture, wholesale and retail trade of feeds		Korea
TMAPMOBILITY CO.,LTD. 1		8.25		200,000		61,518			200,000	Application software development and supply		Korea
TKDS CO., LTD 3		20.03		—		171			—	Manufacture of video and other imaging equipment		Korea
SANDLE FARMING ASSOCIATION 3		23.04		—		306			—	Manufacture of edible refined oil and processed oil		Korea
				511,984		379,534			510,253
Subsidiaries
Kookmin Bank Cambodia Plc. 4		100.00		USD 76,259		140,477			86,761	Banking and foreign exchange transaction		Cambodia
Kookmin Bank(China) Ltd. 4		100.00		USD 383,875		501,506			418,155	Banking and foreign exchange transaction		China
KB Microfinance Myanmar Co., Ltd. 4		100.00		USD 20,000		10,636			22,405	Micro financing		Myanmar
KB Bank Myanmar Co., Ltd. 4		100.00		USD 200,000		248,823			221,780	Banking and foreign exchange transaction		Myanmar
PRASAC Microfinance Institution Plc. 4		99.99		USD 920,839		1,083,421			1,112,609	Micro financing		Cambodia
PT Bank KB Bukopin Tbk 4		67.00		IDR 88,228		(86,104	)		375,332	Banking and foreign exchange transaction		Indonesia
Orient Kwang-yang Co., Ltd.		36.16		—		(5,930	)		—	Building of ships		Korea
						1,892,829			2,237,042
						2,272,363			2,747,295

105

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates and subsidiaries as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	December 31, 2021
(In thousands of US dollars) (In hundred millions of Indonesian rupiah)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
Associates
Korea Credit Bureau Co., Ltd. 1		9.00		4,500		4,497			2,769	Credit information		Korea
Balhae Infrastructure Company 1		12.61		105,923		99,785			109,584	Investment finance		Korea
Incheon Bridge Co., Ltd. 1		14.99		9,159		(19,481	)		9,159	Operation of highways and related facilities		Korea
KB SPROTT Renewable Private Equity Fund No.1		30.00		4,613		3,726			4,613	Investment finance		Korea
KB Digital Innovation & Growth New Technology Business Investment Fund		45.00		4,500		4,098			4,500	Discovery of and investment in promising FinTech-business venture		Korea
KB Digital Platform Fund		46.67		12,600		12,599			12,600	Digital platform and Tech-based investment in promising companies		Korea
Future Planning KB Start-up Creation Fund		50.00		3,900		10,275			3,900	Investment finance		Korea
KB High-tech Company Investment Fund		50.00		1,500		10,493			1,500	Investment finance		Korea
Aju Good Technology Venture Fund		38.47		12,344		22,926			12,344	Investment finance		Korea
KB-KDBC Pre-IPO New Technology Business Investment Fund		33.33		4,400		5,895			4,400	Investment finance		Korea
KB-TS Technology Venture Private Equity Fund		30.00		7,650		9,015			7,650	Investment finance		Korea
KB Intellectual Property Fund No.2		37.50		15,000		13,838			15,000	Investment finance		Korea
KB Digital Innovation Investment Fund Limited Partnership		25.74		35,000		35,517			35,000	Investment finance		Korea
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		21.28		13,000		14,834			13,000	Investment finance		Korea
KB Global Platform Fund		22.73		42,000		49,946			42,000	Investment finance		Korea
KB-UTC Inno-Tech Venture Fund		29.53		14,250		13,982			14,250	Investment finance		Korea
WJ Private Equity Fund No.1		26.95		10,000		9,604			10,000	Investment finance		Korea
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		28.57		10,000		9,571			10,000	Investment finance		Korea
KB Smart Scale Up Fund		25.00		31,000		31,217			31,000	Investment finance		Korea
KB Bio Global Expansion Private Equity Fund No.1		26.32		10,000		9,978			10,000	Investment finance		Korea
KB-KTB Technology Venture Fund		27.27		3,000		2,975			3,000	Investment finance		Korea
KB-SOLIDUS Healthcare Investment Fund		29.41		600		600			600	Investment finance		Korea
KB New Deal Innovation Fund		20.00		4,000		3,991			4,000	Investment finance		Korea
All Together Korea Fund No.2 2		99.99		10,000		10,070			10,000	Asset management		Korea
Shinla Construction Co., Ltd. 3		20.17		—		(551	)		—	Specialty construction		Korea
Terra Corporation 3		24.06		—		2			—	Manufacture of fabricated and processed metal products		Korea

106

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates and subsidiaries as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	December 31, 2021
(In thousands of US dollars) (In hundred millions of Indonesian rupiah)	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
MJT&I Corp. 3		22.89		—		(881	)		—	Wholesale of other merchandise		Korea
Jungdong Steel Co., Ltd. 3		42.65		—		(433	)		—	Wholesale of primary metal		Korea
DSMETAL Co., Ltd. 3		26.49		—		(100	)		—	Manufacture of metal door, windows, shutter and relevant products		Korea
Shinhwa Underwear Co., Ltd. 3		26.05		—		(41	)		—	Manufacture of underwear and sleepwear		Korea
Jaeyang Industry Co., Ltd. 3		20.86		—		(552	)		—	Manufacture of luggage and other protective cases		Korea
Kendae Co., Ltd. 3		41.01		—		(252	)		—	Screen printing		Korea
Jinseung Tech Co., Ltd. 3		30.04		—		(206	)		—	Manufacture of other general-purpose machinery		Korea
Dongjo Co., Ltd. 3		29.29		—		712			—	Wholesale of agricultural and forestry machinery and equipment		Korea
Korea NM Tech Co., Ltd. 3		22.41		—		552			—	Manufacture of motor vehicles, trailers and semitrailers		Korea
Jungdo Co., Ltd. 3		25.34		—		1,105			—	Office, commercial and institutional building construction		Korea
Dae-A Leisure Co., Ltd. 3		49.36		—		833			—	Earth works		Korea
Chongil Machine & Tools Co., Ltd. 3		20.40		—		(171	)		—	Wholesale of machinery and equipment		Korea
Imt Technology Co., Ltd. 3		25.29		—		25			—	Computer Peripherals Distribution		Korea
Iwon Alloy Co., Ltd. 3		23.20		—		394			—	Manufacture of smelting, refining and alloys		Korea
Carlife Co., Ltd. 3		24.39		—		(62	)		—	Publishing of magazines and periodicals (publishing industry)		Korea
Computerlife Co., Ltd. 3		25.41		—		(137	)		—	Publishing of magazines and periodicals (publishing industry)		Korea
Skydigital Inc. 3		20.40		—		(316	)		—	Manufacture of multimedia and video devices		Korea
Jo Yang Industrial Co., Ltd. 3		22.77		—		(29	)		—	Manufacture of special glass		Korea
Il-Kwang Electronic Materials Co., Ltd. 3		29.06		—		(557	)		—	Manufacture of electronic parts		Korea
So-Myung Recycling Co., Ltd. 3		20.23		—		215			—	Manufacture of nonferrous metal		Korea
IDTECK Co., Ltd. 3		20.54		—		(208	)		—	Other manufacturing of wireless telecommunications equipment		Korea

107

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13.1 Details of investments in associates and subsidiaries as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won) (In thousands of US dollars) (In hundred millions of Indonesian rupiah)	December 31, 2021
	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
PIP System Co., Ltd. 3		20.72		—		27			—	Print equipment		Korea
Gwang Myung Paper Co., Ltd. 3		20.54		—		84			—	Wholesale of luggage and other protective cases		Korea
D-Partner 3		20.94		—		816			—	Backlight film		Korea
Inter Shipping Co., Ltd. 3		42.09		—		(17	)		—	Sea freight water transport		Korea
Chunsung-meat Co., Ltd. 3		26.74		—		270			—	Wholesale of meat		Korea
DS Fashionbiz Co., Ltd. 3		47.64		—		(1	)		—	Manufacture of textiles		Korea
				368,939		370,472			370,869
Subsidiaries
Kookmin Bank Cambodia Plc. 4		100.00		USD 76,259		118,940			86,761	Banking and foreign exchange transaction		Cambodia
Kookmin Bank(China) Ltd. 4		100.00		USD 383,875		516,742			418,155	Banking and foreign exchange transaction		China
KB Microfinance Myanmar Co., Ltd. 4		100.00		USD 20,000		13,042			22,405	Micro financing		Myanmar
KB Bank Myanmar Co., Ltd. 4		100.00		USD 200,000		233,987			221,780	Banking and foreign exchange transaction		Myanmar
PRASAC Microfinance Institution Plc. 4		99.99		USD 920,839		798,794			1,112,609	Micro financing		Cambodia
PT Bank KB Bukopin Tbk 4		67.00		IDR 88,228		427,443			731,659	Banking and foreign exchange transaction		Indonesia
						2,108,948			2,593,369
						2,479,420			2,964,238

¹ As of December 31, 2022 and 2021, the Bank can exercise significant influence on the decision-making processes of the associate’s financial and business policies through participation in governing bodies.

²  As of December 31, 2022 and 2021, the Bank participates in the investment management committee but cannot exercise control.

³ The investment in associates was reclassified from financial assets at fair value through other comprehensive income due to termination of rehabilitation procedures.

⁴  Acquisition costs of investments in foreign subsidiaries are presented in US dollars and IDR.

Although the Bank holds 20% or more of the ownership in several investment trusts including KB Hanbando BTL Private Special Asset Fund No.1, those investment trusts are excluded from associates because the Bank’s influence on those trusts is limited according to the trust agreement. In addition, the Bank holds 20% or more of its ownership in Seokwang T&I Co., Ltd. and six other companies, but those companies are excluded from associates, because the Bank’s influence on those companies is limited due to the status of those companies such as bankruptcy and rehabilitation proceedings.

108

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13.2 Changes in carrying amount of investments in associates and subsidiaries for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Beginning		Acquisition and others		Disposal and others			Impairment		Ending
Associates
Korea Credit Bureau Co., Ltd.		2,769		—		—			—		2,769
Balhae Infrastructure Company		109,584		—		(109,584	)		—		—
Incheon Bridge Co., Ltd.		9,159		—		—			—		9,159
KB SPROTT Renewable Private Equity Fund No.1		4,613		9,748		—			—		14,361
KB Digital Innovation & Growth New Technology Business Investment Fund		4,500		—		—			—		4,500
KB Digital Platform Fund		12,600		14,000		—			—		26,600
KB Prime Digital Platform Fund		—		2,600		—			—		2,600
Future Planning KB Start-up Creation Fund		3,900		—		(1,700	)		—		2,200
KB High-tech Company Investment Fund		1,500		—		—			—		1,500
Aju Good Technology Venture Fund		12,344		—		(4,200	)		—		8,144
KB-KDBC Pre-IPO New Technology Business Investment Fund		4,400		—		(2,600	)		—		1,800
KB-TS Technology Venture Private Equity Fund		7,650		—		(2,430	)		—		5,220
KB Intellectual Property Fund No.2		15,000		—		—			—		15,000
KB Digital Innovation Investment Fund Limited Partnership		35,000		—		—			—		35,000
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		13,000		—		(6,400	)		—		6,600
KB Global Platform Fund		42,000		8,000		(6,150	)		—		43,850
KB-UTC Inno-Tech Venture Fund		14,250		—		—			—		14,250
WJ Private Equity Fund No.1		10,000		—		—			—		10,000
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		10,000		—		—			—		10,000
KB Smart Scale Up Fund		31,000		12,000		—			—		43,000
KB Scale Up Fund II		—		4,500		—			—		4,500
KB Bio Global Expansion Private Equity Fund No.1		10,000		—		—			—		10,000
KB-KTB Technology Venture Fund		3,000		6,000		—			—		9,000
KB-SOLIDUS Healthcare Investment Fund		600		6,000		—			—		6,600
KB New Deal Innovation Fund		4,000		9,600		—			—		13,600
All Together Korea Fund No.2		10,000		—		—			—		10,000
TMAPMOBILITY CO.,LTD.		—		200,000		—			—		200,000

109

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13.2 Changes in carrying amount of investments in associates and subsidiaries for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2022
	Beginning		Acquisition and others		Disposal and others			Impairment			Ending
Subsidiaries
Kookmin Bank Cambodia Plc.		86,761		—		—			—			86,761
Kookmin Bank (China) Ltd.		418,155		—		—			—			418,155
KB Microfinance Myanmar Co., Ltd.		22,405		—		—			—			22,405
KB Bank Myanmar Co., Ltd.		221,780		—		—			—			221,780
PRASAC Microfinance Institution Plc.		1,112,609		—		—			—			1,112,609
PT Bank KB Bukopin Tbk		731,659		—		—			(356,327	)		375,332
Orient Kwang-yang Co., Ltd. *		—		—		—			—			—
		2,964,238		272,448		(133,064	)		(356,327	)		2,747,295

(In millions of Korean won)	2021
	Beginning		Acquisition and others		Disposal and others			Impairment		Ending
Associates
Korea Credit Bureau Co., Ltd.		2,769		—		—			—		2,769
Balhae Infrastructure Company		109,768		279		(463	)		—		109,584
KB GwS Private Securities Investment Trust		89,124		—		(89,124	)		—		—
Incheon Bridge Co., Ltd.		9,159		—		—			—		9,159
KB SPROTT Renewable Private Equity Fund No.1		4,613		—		—			—		4,613
KB Digital Innovation & Growth New Technology Business Investment Fund		3,375		1,125		—			—		4,500
KB Digital Platform Fund		—		12,600		—			—		12,600
Future Planning KB Start-up Creation Fund		6,700		—		(2,800	)		—		3,900
KoFC POSCO Hanwha KB Shared Growth Private Equity Fund No.2		7,792		—		(7,792	)		—		—
KB High-tech Company Investment Fund		4,800		—		(3,300	)		—		1,500
Aju Good Technology Venture Fund		17,113		—		(4,769	)		—		12,344
KB-KDBC Pre-IPO New Technology Business Investment Fund		6,800		—		(2,400	)		—		4,400
KB-TS Technology Venture Private Equity Fund		8,880		1,650		(2,880	)		—		7,650
KB Intellectual Property Fund No.2		15,000		—		—			—		15,000
KB Digital Innovation Investment Fund Limited Partnership		35,000		—		—			—		35,000
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		13,400		5,000		(5,400	)		—		13,000
KB Global Platform Fund		28,500		13,500		—			—		42,000
KB-UTC Inno-Tech Venture Fund		11,610		3,390		(750	)		—		14,250
WJ Private Equity Fund No.1		10,000		—		—			—		10,000

110

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

13.2 Changes in carrying amount of investments in associates and subsidiaries for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2021
	Beginning		Acquisition and others		Disposal and others			Impairment		Ending
KB-KDBC Pre-IPO New Technology Business Investment Fund No.2		2,500		7,500		—			—		10,000
KB Smart Scale Up Fund		4,000		27,000		—			—		31,000
KB Bio Global Expansion Private Equity Fund No.1		—		10,000		—			—		10,000
KB-KTB Technology Venture Fund		—		3,000		—			—		3,000
KB-SOLIDUS Healthcare Investment Fund		—		600		—			—		600
KB New Deal Innovation Fund		—		4,000		—			—		4,000
All Together Korea Fund No.2		10,000		—		—			—		10,000
Subsidiaries
Kookmin Bank Cambodia Plc.		86,761		—		—			—		86,761
Kookmin Bank (China) Ltd.		418,155		—		—			—		418,155
KB Microfinance Myanmar Co., Ltd.		22,405		—		—			—		22,405
KB Bank Myanmar Co., Ltd.		221,780		—		—			—		221,780
PRASAC Microfinance Institution Plc.		709,971		402,638		—			—		1,112,609
PT Bank KB Bukopin Tbk		338,116		393,543		—			—		731,659
		2,198,091		885,825		(119,678	)		—		2,964,238

* The investment was reclassified from associates to subsidiaries during the year ended December 31, 2022 due to additional share purchase.

111

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

14. Property and Equipment, and Investment Properties

14.1 Property and Equipment

14.1.1 Details of property and equipment as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Acquisition cost		Accumulated depreciation			Accumulated impairment losses			Carrying amount
Land		1,827,827		—			(4	)		1,827,823
Buildings		1,723,871		(545,387	)		(5,747	)		1,172,737
Leasehold improvements		888,348		(837,677	)		—			50,671
Equipment and vehicles		1,215,431		(1,080,071	)		—			135,360
Construction in-progress		2,372		—			—			2,372
Right-of-use assets		991,148		(650,977	)		—			340,171
		6,648,997		(3,114,112	)		(5,751	)		3,529,134

(In millions of Korean won)	December 31, 2021
	Acquisition cost		Accumulated depreciation			Accumulated impairment losses			Carrying amount
Land		1,866,830		—			(4	)		1,866,826
Buildings		1,694,900		(522,238	)		(5,747	)		1,166,915
Leasehold improvements		853,560		(793,733	)		—			59,827
Equipment and vehicles		1,296,746		(1,150,651	)		—			146,095
Construction in-progress		24,130		—			—			24,130
Right-of-use assets		860,150		(517,755	)		—			342,395
		6,596,316		(2,984,377	)		(5,751	)		3,606,188

112

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

14.1.2 Changes in property and equipment for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)

	2022
	Beginning		Acquisition		Transfer 2			Disposal			Depreciation			Others			Ending
Land		1,866,826		55		(32,963	)		(6,072	)		—			(23	)		1,827,823
Buildings		1,166,915		1,421		49,755			(3,818	)		(41,496	)		(40	)		1,172,737
Leasehold improvements		59,827		1,672		33,605			(7	)		(44,504	)		78			50,671
Equipment and vehicles		146,095		83,939		(817	)		(380	)		(93,490	)		13			135,360
Construction in-progress		24,130		92,726		(114,484	)		—			—			—			2,372
Right-of-use assets 1		342,395		533,562		255			(382,399	)		(191,569	)		37,927			340,171
		3,606,188		713,375		(64,649	)		(392,676	)		(371,059	)		37,955			3,529,134

(In millions of Korean won)

	2021
	Beginning		Acquisition		Transfer 2			Disposal			Depreciation			Others			Ending
Land		1,911,818		48		(45,032	)		—			—			(8	)		1,866,826
Buildings		1,199,872		316		10,285			(2,123	)		(41,422	)		(13	)		1,166,915
Leasehold improvements		65,579		16		39,359			(703	)		(44,619	)		195			59,827
Equipment and vehicles		175,005		74,841		1,547			(241	)		(105,244	)		187			146,095
Construction in-progress		14,224		93,132		(83,276	)		—			—			50			24,130
Right-of-use assets 1		366,623		476,030		—			(305,340	)		(197,985	)		3,067			342,395
		3,733,121		644,383		(77,117	)		(308,407	)		(389,270	)		3,478			3,606,188

¹  Effect of change in the lease term is reflected in acquisition and disposal based on gross amount.

²  Includes transfers with investment properties and assets held for sale.

14.1.3 Changes in accumulated impairment losses of property and equipment for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Beginning			Impairment		Reversal		Others		Ending
Accumulated impairment losses of property and equipment		(5,751	)		—		—		—		(5,751	)

(In millions of Korean won)	2021
	Beginning			Impairment		Reversal		Others		Ending
Accumulated impairment losses of property and equipment		(6,877	)		—		—		1,126		(5,751	)

113

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

14.2 Investment Properties

14.2.1 Details of investment properties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Acquisition cost		Accumulated Depreciation			Carrying amount
Land		63,139		—			63,139
Buildings		69,628		(13,444	)		56,184
		132,767		(13,444	)		119,323

(In millions of Korean won)	December 31, 2021
	Acquisition cost		Accumulated depreciation			Carrying amount
Land		55,190		—			55,190
Buildings		49,126		(6,665	)		42,461
		104,316		(6,665	)		97,651

14.2.2 Valuation techniques and inputs used to measure the fair value of investment properties as of December 31, 2022, are as follows:

(In millions of Korean won)	December 31, 2022
	Fair value		Valuation techniques		Inputs
Land and buildings		194,157		Cost approach method	- Price per square meter - Replacement cost

Fair value of investment properties amounts to W 194,157 million and W 150,299 million as of December 31, 2022 and 2021, respectively. Investment properties are measured by qualified independent appraisers with recent experience in valuing similar properties in the same area. In addition, all investment properties are classified as Level 3 in accordance with fair value hierarchy in Note 6.1.2.

Rental income from above investment properties amounts to W 5,441 million and W 4,477 million for the years ended December 31, 2022 and 2021, respectively.

14.2.3 Changes in investment properties for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Beginning		Acquisition		Transfer		Depreciation			Ending
Land		55,190		—		7,949		—			63,139
Buildings		42,461		—		15,381		(1,658	)		56,184
		97,651		—		23,330		(1,658	)		119,323

(In millions of Korean won)	2021
	Beginning		Acquisition		Transfer		Depreciation			Ending
Land		50,700		—		4,490		—			55,190
Buildings		38,406		—		5,246		(1,191	)		42,461
		89,106		—		9,736		(1,191	)		97,651

114

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

15. Intangible Assets

15.1 Details of intangible assets as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Acquisition cost		Accumulated amortization			Accumulated impairment losses			Carrying amount
Goodwill		65,288		—			—			65,288
Other intangible assets		1,589,447		(1,146,478	)		(14,978	)		427,991
		1,654,735		(1,146,478	)		(14,978	)		493,279

(In millions of Korean won)	December 31, 2021
	Acquisition cost		Accumulated amortization			Accumulated impairment losses			Carrying amount
Goodwill		65,288		—			—			65,288
Other intangible assets		1,435,482		(1,013,372	)		(15,145	)		406,965
		1,500,770		(1,013,372	)		(15,145	)		472,253

15.2 The goodwill as of December 31, 2022 and 2021, arose from the merger of Housing & Commercial Bank (“H&CB”).

15.3 Details of goodwill allocation to cash-generating units and related information for impairment testing as of December 31, 2022 are as follows:

(In millions of Korean won)	December 31, 2022
	Retail banking		Corporate Banking		Total
Carrying amounts		49,315		15,973		65,288
Recoverable amount exceeding carrying amount		5,778,171		2,905,282		8,683,453
Discount rate (%)		16.60		17.01
Permanent growth rate (%)		1.00		1.00

For impairment testing, goodwill is allocated to cash-generating units that are expected to benefit from the synergies of the business combination, and cash-generating units consist of an operating segment or units which are not larger than an operating segment. The Bank recognized goodwill amounting to W 65,288 million arising from the merger of Housing & Commercial Bank, the amounts of W 49,315 million and W 15,973 million were allocated to the retail banking and corporate banking, respectively. Cash-generating units to which goodwill has been allocated is tested for impairment annually and whenever there is an indication that the unit may be impaired by comparing the carrying amount of the unit including the goodwill with the recoverable amount of the unit.

115

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

The recoverable amount of a cash-generating unit is measured at the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal is the amount obtainable from the disposal in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal. If it is difficult to measure the amount obtainable from the disposal of the cash-generating unit, the disposal amount of a similar cash-generating unit in the past transaction is used by reflecting the characteristics of the cash-generating unit to be measured. If it is not possible to obtain reliable information to measure the fair value less costs of disposal, the Bank uses the asset’s value in use as its recoverable amount. Value in use is the present value of the future cash flows expected to be derived from an asset or cash-generating unit. The future cash flows of retail banking and corporate banking are estimated on the assumption that the future cash flows will increase by 1.0% per year. The key assumptions used for the estimation of the future cash flows are based on GDP growth rate, market size, and the Bank’s market share. The discount rate is a pre-tax rate that reflects assumptions regarding risk-free interest rate, market risk premium, and the risks specific to the cash-generating unit.

15.4 Details of intangible assets other than goodwill as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Acquisition cost		Accumulated amortization			Accumulated impairment losses			Carrying amount
Industrial property rights		1,993		(1,694	)		—			299
Software		1,387,570		(1,029,725	)		—			357,845
Other intangible assets		164,757		(82,535	)		(14,978	)		67,244
Right-of-use assets		35,127		(32,524	)		—			2,603
		1,589,447		(1,146,478	)		(14,978	)		427,991

(In millions of Korean won)	December 31, 2021
	Acquisition cost		Accumulated amortization			Accumulated impairment losses			Carrying amount
Industrial property rights		1,800		(1,576	)		—			224
Software		1,220,909		(895,251	)		—			325,658
Other intangible assets		177,646		(85,028	)		(15,145	)		77,473
Right-of-use assets		35,127		(31,517	)		—			3,610
		1,435,482		(1,013,372	)		(15,145	)		406,965

116

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

15.5 Changes in intangible assets other than goodwill for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)

	2022
	Beginning		Acquisition		Transfer		Disposal			Amortization			Others			Ending
Industrial property rights		224		193		—		—			(117	)		(1	)		299
Software		325,658		168,256		817		—			(136,906	)		20			357,845
Other intangible assets		77,474		2,787		—		(245	)		(12,849	)		77			67,244
Right-of-use assets		3,610		—		—		—			(1,007	)		—			2,603
		406,966		171,236		817		(245	)		(150,879	)		96			427,991

(In millions of Korean won)

	2021
	Beginning		Acquisition		Disposal			Amortization			Others			Ending
Industrial property rights		234		107		—			(117	)		—			224
Software		309,397		129,221		—			(112,962	)		2			325,658
Other intangible assets		53,107		45,693		(1,834	)		(14,624	)		(4,869	)		77,473
Right-of-use assets		4,617		—		—			(1,007	)		—			3,610
		367,355		175,021		(1,834	)		(128,710	)		(4,867	)		406,965

15.6 Changes in accumulated impairment losses of other intangible assets for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Beginning			Impairment		Reversal		Others		Ending
Accumulated impairment losses of other intangible assets		(15,145	)		—		—		167		(14,978	)

(In millions of Korean won)	2021
	Beginning			Impairment			Reversal		Others		Ending
Accumulated impairment losses of other intangible assets		(10,215	)		(4,971	)		—		41		(15,145	)

117

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

16. Deferred Income Tax Assets and Liabilities

16.1 Details of deferred income tax assets and liabilities as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Assets			Liabilities			Net amount
Other provisions		83,333			—			83,333
Impairment losses of property and equipment		5,155			—			5,155
Share-based payments		13,112			—			13,112
Provisions for acceptances and guarantees		39,787			—			39,787
Gains or losses on valuation of derivatives		—			(155,184	)		(155,184	)
Present value discount		95			—			95
Gains or losses on fair value hedge		—			(93,833	)		(93,833	)
Accrued interest		—			(72,868	)		(72,868	)
Deferred loan origination fees and costs		—			(115,553	)		(115,553	)
Gains or losses on revaluation		—			(261,502	)		(261,502	)
Investments in subsidiaries and others		17,121			—			17,121
Gains or losses on valuation of security investment		245,988			—			245,988
Defined benefit liabilities		375,797			—			375,797
Accrued expenses		172,345			—			172,345
Retirement insurance expense		—			(459,323	)		(459,323	)
Adjustments to the prepaid contributions		—			(27,986	)		(27,986	)
Others		225,017			(96,937	)		128,080
		1,177,750			(1,283,186	)		(105,436	)
Offsetting of deferred income tax assets and liabilities		(1,177,750	)		1,177,750			—
		—			(105,436	)		(105,436	)

(In millions of Korean won)	December 31, 2021
	Assets			Liabilities			Net amount
Other provisions		75,959			—			75,959
Impairment losses of property and equipment		7,446			—			7,446
Share-based payments		15,687			—			15,687
Provisions for acceptances and guarantees		33,091			—			33,091
Gains or losses on valuation of derivatives		—			(81,544	)		(81,544	)
Present value discount		—			(142	)		(142	)
Gains or losses on fair value hedge		—			(14,642	)		(14,642	)
Accrued interest		—			(42,882	)		(42,882	)
Deferred loan origination fees and costs		—			(138,398	)		(138,398	)
Gains or losses on revaluation		—			(277,471	)		(277,471	)
Investments in subsidiaries and others		12,319			—			12,319
Gains or losses on valuation of security investment		—			(501,409	)		(501,409	)
Defined benefit liabilities		469,311			—			469,311
Accrued expenses		148,726			—			148,726
Retirement insurance expense		—			(441,634	)		(441,634	)
Adjustments to the prepaid contributions		—			(29,273	)		(29,273	)
Others		230,686			(105,912	)		124,774
		993,225			(1,633,307	)		(640,082	)
Offsetting of deferred income tax assets and liabilities		(993,225	)		993,225			—
		—			(640,082	)		(640,082	)

118

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

16.2 Unrecognized Deferred Income Tax Assets

16.2.1 No deferred income tax assets have been recognized for the deductible temporary differences of W 635,093 million and W 152,345 million associated with investments in subsidiaries and others as of December 31, 2022 and 2021, because it is not probable that these temporary differences will reverse in the foreseeable future.

16.2.2 No deferred income tax assets have been recognized for the deductible temporary differences of W 34,908 million and W 39,822 million associated with others as of December 31, 2022 and 2021, due to the uncertainty that these temporary differences will be realized in the future.

16.3 Unrecognized Deferred Income Tax Liabilities

No deferred income tax liabilities have been recognized as of December 31, 2022 and 2021 for the taxable temporary differences of W 65,288 million related to the initial recognition of goodwill arising from the merger of Housing and Commercial Bank in 2001.

119

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

16.4 Changes in cumulative temporary differences for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning			Decrease			Increase			Ending
Deductible temporary differences
Other provisions		276,213			276,213			314,465			314,465
Impairment losses of property and equipment		27,077			19,880			12,255			19,452
Share-based payments		57,042			57,042			49,479			49,479
Provisions for acceptances and guarantees		120,332			120,332			150,140			150,140
Present value discount		—			—			358			358
Investments in subsidiaries and others		197,142			—			502,559			699,701
Gains or losses on valuation of security investment		—			—			928,258			928,258
Defined benefit liabilities		1,706,586			288,674			192			1,418,104
Accrued expenses		540,823			540,823			650,357			650,357
Others		878,679			392,448			397,795			884,026
		3,803,894			1,695,412			3,005,858			5,114,340
Unrecognized deferred income tax assets
Investments in subsidiaries and others		152,345									635,093
Others		39,822									34,908
		3,611,727									4,444,339
Tax rate (%)		27.50									26.50
Total deferred income tax assets		993,225									1,177,750
Taxable temporary differences
Gains or losses on fair value hedge		(53,243	)		(53,243	)		(354,085	)		(354,085	)
Accrued interest		(155,936	)		(119,589	)		(238,628	)		(274,975	)
Deferred loan origination fees and costs		(503,266	)		(503,266	)		(436,047	)		(436,047	)
Gains or losses on valuation of derivatives		(296,525	)		(296,525	)		(585,598	)		(585,598	)
Present value discount		(517	)		(517	)		—			—
Goodwill arising from the merger		(65,288	)		—			—			(65,288	)
Gains or losses on revaluation		(1,008,984	)		(22,185	)		—			(986,799	)
Retirement insurance expense		(1,605,938	)		(237,587	)		(364,944	)		(1,733,295	)
Adjustments to the prepaid contributions		(106,446	)		(106,446	)		(105,608	)		(105,608	)
Gains or losses on valuation of security investment		(1,823,307	)		(1,823,307	)		—			—
Others		(385,137	)		(329,375	)		(310,043	)		(365,805	)
		(6,004,587	)		(3,492,040	)		(2,394,953	)		(4,907,500	)
Unrecognized deferred income tax liabilities
Goodwill arising from the merger		(65,288	)								(65,288	)
		(5,939,299	)								(4,842,212	)
Tax rate (%)		27.50									26.50
Total deferred income tax liabilities		(1,633,307	)								(1,283,186	)

120

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

16.4 Changes in cumulative temporary differences for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2021
	Beginning			Decrease			Increase			Ending
Deductible temporary differences
Gains or losses on fair value hedge		76,583			76,583			—			—
Other provisions		282,969			282,969			276,213			276,213
Impairment losses of property and equipment		8,148			4,361			23,290			27,077
Share-based payments		42,361			42,361			57,042			57,042
Provisions for acceptances and guarantees		61,984			61,984			120,332			120,332
Investments in subsidiaries and others		139,981			—			57,161			197,142
Defined benefit liabilities		1,605,795			178,937			279,728			1,706,586
Accrued expenses		765,387			765,387			540,823			540,823
Others		918,468			431,045			391,256			878,679
		3,901,676			1,843,627			1,745,845			3,803,894
Unrecognized deferred income tax assets
Investments in subsidiaries and others		114,839									152,345
Others		23,827									39,822
		3,763,010									3,611,727
Tax rate (%)		27.50									27.50
Total deferred income tax assets		1,034,828									993,225
Taxable temporary differences
Gains or losses on fair value hedge		—			—			(53,243	)		(53,243	)
Accrued interest		(127,345	)		(111,820	)		(140,411	)		(155,936	)
Deferred loan origination fees and costs		(510,055	)		(510,055	)		(503,266	)		(503,266	)
Gains or losses on valuation of derivatives		(362,772	)		(362,772	)		(296,525	)		(296,525	)
Present value discount		(49	)		(49	)		(517	)		(517	)
Goodwill arising from the merger		(65,288	)		—			—			(65,288	)
Gains or losses on revaluation		(1,008,984	)		—			—			(1,008,984	)
Retirement insurance expense		(1,462,642	)		(178,937	)		(322,233	)		(1,605,938	)
Adjustments to the prepaid contributions		(102,768	)		(102,768	)		(106,446	)		(106,446	)
Gains or losses on valuation of security investment		(967,057	)		(967,057	)		(1,823,307	)		(1,823,307	)
Others		(394,868	)		(339,168	)		(329,437	)		(385,137	)
		(5,001,828	)		(2,572,626	)		(3,575,385	)		(6,004,587	)
Unrecognized deferred income tax liabilities
Goodwill arising from the merger		(65,288	)								(65,288	)
		(4,936,540	)								(5,939,299	)
Tax rate (%)		27.50									27.50
Total deferred income tax liabilities		(1,357,548	)								(1,633,307	)

121

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

17. Assets Held for Sale

17.1 Details of assets held for sale as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Acquisition cost *		Accumulated impairment losses			Carrying amount		Fair value less costs to sell
Land held for sale		20,020		(659	)		19,361		31,144
Buildings held for sale		17,456		(5,846	)		11,610		12,637
		37,476		(6,505	)		30,971		43,781

(In millions of Korean won)	December 31, 2021
	Acquisition cost *		Accumulated impairment losses			Carrying amount		Fair value less costs to sell
Land held for sale		34,285		(136	)		34,149		62,897
Buildings held for sale		22,372		(12,362	)		10,010		11,841
		56,657		(12,498	)		44,159		74,738

* Acquisition cost of buildings held for sale is net of accumulated depreciation amount immediately before the initial classification of the assets as held for sale.

17.2 Valuation techniques and inputs used to measure the fair value of assets held for sale as of December 31, 2022, are as follows:

(In millions of Korean won)

	December 31, 2022
	Fair value		Valuation techniques 1	Unobservable inputs 2	Estimated range of unobservable inputs (%)	Effect of unobservable inputs to fair value
Land and buildings		43,781	Market comparison approach model and others	Adjustment index	0.32 ~ 2.21	Fair value increases as the adjustment index rises

¹ The appraisal value is adjusted by the adjustment ratio in the event the public sale is unsuccessful.

² Adjustment index is calculated using the time factor correction or individual factors.

Among assets held for sale, real estate was measured by independent appraisers with professional qualifications and recent experience in evaluating similar properties in the area of the property to be assessed. All assets held for sale are classified as Level 3 in accordance with fair value hierarchy in Note 6.1.2.

122

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

17.3 Changes in accumulated impairment losses of assets held for sale for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Beginning			Provision			Reversal		Others		Ending
Accumulated impairment losses of assets held for sale		(12,498	)		(5,752	)		—		11,745		(6,505	)

(In millions of Korean won)	2021
	Beginning			Provision			Reversal		Others		Ending
Accumulated impairment losses of assets held for sale		(1,271	)		(13,755	)		—		2,528		(12,498	)

17.4 As of December 31, 2022, assets held for sale consist of 11 real estates of closed offices, which were determined to sell by management, but not yet sold as of December 31, 2022. Negotiation with buyers is in process for the one asset and the remaining 11 assets are also being actively marketed.

123

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

18. Other Assets

18.1 Details of other assets as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Other financial assets
Other receivables		3,442,060			2,398,220
Accrued income		1,462,182			919,963
Guarantee deposits		819,181			870,196
Domestic exchange settlement debits		861,742			989,551
Others		33,899			31,820
Less: Allowances for credit losses		(11,790	)		(9,627	)
Present value discount		(5,361	)		(6,714	)
		6,601,913			5,193,409
Other non-financial assets
Other receivables		94			138
Prepaid expenses		207,355			141,572
Guarantee deposits		1,908			2,369
Prepayments		21,456			28,856
Others		43,213			45,822
Less: Allowances for credit losses		(10,926	)		(8,546	)
		263,100			210,211
		6,865,013			5,403,620

18.2 Changes in allowances for credit losses of other assets for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Other financial assets			Other non- financial assets			Total
Beginning		9,627			8,546			18,173
Provision (reversal)		2,875			2,450			5,325
Write-offs		(1,801	)		(70	)		(1,871	)
Others		1,089			—			1,089
Ending		11,790			10,926			22,716

(In millions of Korean won)	2021
	Other financial assets			Other non- financial assets			Total
Beginning		11,570			9,804			21,374
Provision (reversal)		(954	)		125			(829	)
Write-offs		(2,344	)		(2,762	)		(5,106	)
Others		1,355			1,379			2,734
Ending		9,627			8,546			18,173

124

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

19. Deposits

Details of deposits as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Demand deposits
Demand deposits in Korean won		147,981,433			174,214,102
Demand deposits in foreign currencies		10,780,079			13,827,895
		158,761,512			188,041,997
Time deposits
Time deposits in Korean won		187,999,054			150,049,246
Time deposits in foreign currencies		15,023,134			7,409,760
Fair value adjustments of fair value hedged time deposits in foreign currencies		(8,592	)		(1,319	)
		203,013,596			157,457,687
Certificates of deposits		6,325,876			4,115,688
		368,100,984			349,615,372

20. Borrowings

20.1 Details of borrowings as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
General borrowings		35,556,621		28,986,380
Bonds sold under repurchase agreements and others		4,820,795		556,036
Call money		3,287,254		1,531,492
		43,664,670		31,073,908

125

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

20.2 Details of general borrowings as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		Lenders	Annual interest rate (%)	December 31, 2022		December 31, 2021
Borrowings in Korean won	Borrowings from the Bank of Korea	The Bank of Korea	0.25~1.75		8,282,289		7,131,019
	Borrowings from the government	SEMAS and others	0.00~3.23		2,670,867		2,683,056
	Borrowings from non-banking financial institutions	The Korea Development Bank	1.39~2.64		477,788		432,310
	Other borrowings	The Korea Development Bank and others	0.00~5.61		5,229,890		5,294,403
					16,660,834		15,540,788
Borrowings in foreign currencies	Due to banks	BANK OF CHINA SEOUL BRANCH and others	—		18,270		2,146
	Borrowings from banks	Central Bank of Uzbekistan and others	0.00~5.75		13,262,415		11,240,278
	Borrowings from other financial institutions	The Export-Import Bank of Korea and others	5.07~5.89		38,249		24,867
	Other borrowings	Standard Chartered Bank and others	0.00~5.54		5,576,853		2,178,301
					18,895,787		13,445,592
					35,556,621		28,986,380

20.3 Details of bonds sold under repurchase agreements and others as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Lenders	Annual interest rate (%)		December 31, 2022		December 31, 2021
Bonds sold under repurchase agreements	Individuals, groups, and corporations		2.65~9.75		4,816,995		553,934
Bills sold	Counter sale		1.55~2.00		3,800		2,102
					4,820,795		556,036

20.4 Details of call money as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)

	Lenders	Annual interest rate (%)		December 31, 2022		December 31, 2021
Call money in Korean won	Mitsui Sumitomo Bank Seoul		2.90~3.23		2,113,500		—
Call money in foreign currencies	STANDARD CHARTERED BANK KOREA LTD. and others		2.80~7.80		1,173,754		1,531,492
					3,287,254		1,531,492

126

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

21. Debentures

21.1 Details of debentures as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Annual interest rate (%)		December 31, 2022			December 31, 2021
Debentures in Korean won
Structured debentures		5.65~8.62		30,710			30,910
Subordinated fixed rate debentures		2.02~7.86		4,089,890			5,292,957
Fixed rate debentures		0.99~13.70		10,730,003			8,800,013
Floating rate debentures		1.54~4.01		4,100,000			5,310,000
				18,950,603			19,433,880
Fair value adjustments of fair value hedged debentures in Korean won				(249,629	)		(79,877	)
Less: Discount on debentures in Korean won				(7,371	)		(14,685	)
				18,693,603			19,339,318
Debentures in foreign currencies
Floating rate debentures		2.42~5.98		1,312,913			1,948,962
Fixed rate debentures		0.05~6.81		8,120,304			5,596,228
				9,433,217			7,545,190
Fair value adjustments of fair value hedged debentures in foreign currencies				(95,864	)		27,952
Less: Discount on debentures in foreign currencies				(31,540	)		(21,319	)
				9,305,813			7,551,823
				27,999,416			26,891,141

21.2 Changes in debentures based on par value for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Beginning		Issue		Repayment			Others		Ending
Debentures in Korean won
Structured debentures		30,910		—		(200	)		—		30,710
Subordinated fixed rate debentures		5,292,957		—		(1,203,067	)		—		4,089,890
Fixed rate debentures		8,800,013		7,070,000		(5,140,010	)		—		10,730,003
Floating rate debentures		5,310,000		4,960,000		(6,170,000	)		—		4,100,000
		19,433,880		12,030,000		(12,513,277	)		—		18,950,603
Debentures in foreign currencies
Floating rate debentures		1,948,962		755,815		(1,597,630	)		205,766		1,312,913
Fixed rate debentures		5,596,228		3,354,673		(1,079,221	)		248,624		8,120,304
		7,545,190		4,110,488		(2,676,851	)		454,390		9,433,217
		26,979,070		16,140,488		(15,190,128	)		454,390		28,383,820

127

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

21.2 Changes in debentures based on par value for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2021
	Beginning		Issue		Repayment			Others		Ending
Debentures in Korean won
Structured debentures		31,960		—		(1,050	)		—		30,910
Subordinated fixed rate debentures		4,464,407		830,000		(1,450	)		—		5,292,957
Fixed rate debentures		12,840,014		3,190,000		(7,230,001	)		—		8,800,013
Floating rate debentures		1,890,000		5,310,000		(1,890,000	)		—		5,310,000
		19,226,381		9,330,000		(9,122,501	)		—		19,433,880
Debentures in foreign currencies
Floating rate debentures		1,353,472		810,920		(350,235	)		134,805		1,948,962
Fixed rate debentures		4,064,394		2,324,834		(1,134,986	)		341,986		5,596,228
		5,417,866		3,135,754		(1,485,221	)		476,791		7,545,190
		24,644,247		12,465,754		(10,607,722	)		476,791		26,979,070

22. Provisions

22.1 Details of provisions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Provisions for credit losses of unused loan commitments		159,211		145,922
Provisions for credit losses of acceptances and guarantees		150,140		120,332
Provisions for restoration costs		135,477		128,407
Others		49,410		27,131
		494,238		421,792

128

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

22.2 Changes in provisions for credit losses of unused loan commitments, and acceptances and guarantees for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Provisions for credit losses of unused loan commitments									Provisions for credit losses of acceptances and guarantees
	12-month expected credit losses			Lifetime expected credit losses						12-month expected credit losses			Lifetime expected credit losses
				Non- impaired			Impaired						Non- impaired			Impaired
Beginning		92,372			53,550			—			26,626			82,169			11,537
Transfer between stages:
Transfer to 12-month expected credit losses		22,750			(22,720	)		(30	)		1,144			(1,144	)		—
Transfer to lifetime expected credit losses		(15,235	)		15,327			(92	)		(345	)		1,006			(661	)
Impairment		(126	)		(460	)		586			(9	)		(142	)		151
Provision (reversal) for credit losses		1,614			10,837			(464	)		(4,527	)		33,994			(3,262	)
Others (exchange differences, etc.)		453			849			—			628			2,841			134
Ending		101,828			57,383			—			23,517			118,724			7,899

(In millions of Korean won)	2021
	Provisions for credit losses of unused loan commitments									Provisions for credit losses of acceptances and guarantees
	12-month expected credit losses			Lifetime expected credit losses						12-month expected credit losses			Lifetime expected credit losses
				Non- impaired			Impaired						Non- impaired			Impaired
Beginning		80,668			78,064			—			32,818			14,838			14,328
Transfer between stages:
Transfer to 12-month expected credit losses		24,962			(24,960	)		(2	)		3,958			(203	)		(3,755	)
Transfer to lifetime expected credit losses		(14,460	)		14,579			(119	)		(3,972	)		3,981			(9	)
Impairment		(131	)		(355	)		486			(10	)		(85	)		95
Provision (reversal) for credit losses		414			(14,173	)		(365	)		(7,700	)		64,190			711
Others (exchange differences, etc.)		919			395			—			1,532			(552	)		167
Ending		92,372			53,550			—			26,626			82,169			11,537

129

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

22.3 Changes in provisions for restoration costs for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Beginning		128,407			131,674
Provision		6,336			5,879
Reversal		1,261			(1,016	)
Used		(12,411	)		(12,541	)
Unwinding of discount		2,363			1,369
Effect of changes in discount rate		9,521			3,042
Ending		135,477			128,407

Provisions for restoration costs are the present value of estimated costs to be incurred for the restoration of the leased properties. The expenditure of the restoration cost will be incurred at the end of each lease contract, and the lease period is used to reasonably estimate the time of expenditure. Also, the average restoration expense based on actual three-year historical data and three-year historical average inflation rate are used to estimate the present value of estimated costs.

22.4 Changes in other provisions for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Membership rewards program			Dormant accounts			Litigations			Financial guarantee contracts			Others			Total
Beginning		43			3,062			7,626			5,365			11,035			27,131
Provision (reversal)		84			2,666			19			(2,112	)		26,578			27,235
Used and others		(81	)		(2,934	)		(4	)		—			(1,937	)		(4,956	)
Ending		46			2,794			7,641			3,253			35,676			49,410

(In millions of Korean won)	2021
	Membership rewards program			Dormant accounts			Litigations			Financial guarantee contracts			Others			Total
Beginning		35			3,008			7,647			6,426			14,627			31,743
Provision (reversal)		77			3,429			24			(1,061	)		(4,115	)		(1,646	)
Used and others		(69	)		(3,375	)		(45	)		—			523			(2,966	)
Ending		43			3,062			7,626			5,365			11,035			27,131

130

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

23. Net Defined Benefit Liabilities (Assets)

23.1 Defined Benefit Plan

The Bank operates defined benefit plans which have the following characteristics:

- The Bank has the obligation to pay the agreed benefits to all its current and former employees.

- The Bank assumes actuarial risk (that benefits will cost more than expected) and investment risk.

The net defined benefit liabilities (assets) recognized in the statements of financial position are calculated in accordance with actuarial valuation method using assumptions based on market data and historical data such as discount rate, future salary increase rate, and mortality. Actuarial assumptions may differ from actual results, due to changes in the market conditions, economic trends, and mortality trends.

23.2 Changes in net defined benefit liabilities (assets) for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Present value of defined benefit obligation			Fair value of plan assets			Net defined benefit liabilities(assets)
Beginning		1,831,126			(1,692,621	)		138,505
Current service cost		163,208			—			163,208
Interest expense (income)		46,853			(43,392	)		3,461
Remeasurements:
Actuarial gains and losses by experience adjustments		9,041			—			9,041
Actuarial gains and losses by changes in demographic assumptions		41,988			—			41,988
Actuarial gains and losses by changes in financial assumptions		(351,203	)		—			(351,203	)
Return on plan assets (excluding amounts included in interest income)		—			54,808			54,808
Contributions by the Bank		—			(360,000	)		(360,000	)
Payments from plans (benefit payments)		(196,543	)		196,543			—
Payments from the Bank		(7,724	)		—			(7,724	)
Transfer in		5,150			(4,516	)		634
Transfer out		(7,052	)		7,052			—
Effect of exchange differences		(16	)		—			(16	)
Ending		1,534,828			(1,842,126	)		(307,298	)

131

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

23.2 Changes in net defined benefit liabilities (assets) for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2021
	Present value of defined benefit obligation			Fair value of plan assets			Net defined benefit liabilities
Beginning		1,734,103			(1,583,368	)		150,735
Current service cost		153,334			—			153,334
Interest expense (income)		34,075			(31,069	)		3,006
Remeasurements:
Actuarial gains and losses by experience adjustments		5,180			—			5,180
Actuarial gains and losses by changes in demographic assumptions		7,330			—			7,330
Actuarial gains and losses by changes in financial assumptions		82,742			—			82,742
Return on plan assets (excluding amounts included in interest income)		—			5,363			5,363
Contributions by the Bank		—			(264,600	)		(264,600	)
Payments from plans (benefit payments)		(178,937	)		178,937			—
Payments from the Bank		(5,120	)		—			(5,120	)
Transfer in		3,602			(3,067	)		535
Transfer out		(5,183	)		5,183			—
Ending		1,831,126			(1,692,621	)		138,505

23.3 Details of net defined benefit liabilities (assets) as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Present value of defined benefit obligation		1,534,828			1,831,126
Fair value of plan assets		(1,842,126	)		(1,692,621	)
Net defined benefit liabilities (assets)		(307,298	)		138,505

23.4 Details of remeasurements of net defined benefit liabilities recognized in other comprehensive income (loss) for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Remeasurements:
Actuarial losses arising from experience adjustments		(9,041	)		(5,180	)
Actuarial losses arising from changes in demographic assumptions		(41,988	)		(7,330	)
Actuarial losses arising from changes in financial assumptions		351,203			(82,742	)
Return on plan assets (excluding amounts included in interest income)		(54,808	)		(5,363	)
Income tax effect		(67,476	)		27,669
Remeasurements after income tax expense		177,890			(72,946	)

132

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

23.5 Details of fair value of plan assets as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022
	Assets quoted in an active market		Assets not quoted in an active market		Total
Time deposits		—		1,388,054		1,388,054
Others		—		454,072		454,072
		—		1,842,126		1,842,126

(In millions of Korean won)	December 31, 2021
	Assets quoted in an active market		Assets not quoted in an active market		Total
Time deposits		—		1,374,281		1,374,281
Others		—		318,340		318,340
		—		1,692,621		1,692,621

23.6 Details of significant actuarial assumptions used as of December 31, 2022 and 2021, are as follows:

	December 31, 2022	December 31, 2021
Discount rate (%)	5.20	2.60
Salary increase rate (%)	0.00~5.25	0.00~5.04
Turnover rate (%)	2.30~38.60	1.00~20.00

Mortality assumptions are based on the experience-based mortality table issued by Korea Insurance Development Institute in 2019.

23.7 Results of sensitivity analysis of significant actuarial assumptions as of December 31, 2022, are as follows:

		Effect on defined benefit obligation
	Changes in assumptions	Increase in assumptions	Decrease in assumptions
Discount rate	0.5%p	3.05% decrease	3.24% increase
Salary increase rate	0.5%p	3.23% increase	3.06% decrease
Turnover rate	0.5%p	0.24% increase	0.26% decrease

The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. The sensitivity of the defined benefit obligation to changes in significant actuarial assumptions is calculated using the same projected unit credit method used in calculating the defined benefit obligation recognized in the statement of financial position.

133

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

23.8 Expected maturity analysis of undiscounted pension benefit payments as of December 31, 2022, are as follows:

(In millions of Korean won)

	Up to 1 year		1~2 years		2~5 years		5~10 years		Over 10 years		Total
Pension benefits		162,720		215,188		650,944		1,151,476		6,256,181		8,436,509

The weighted average duration of the defined benefit obligation is 7.34 and 9.41 years as of December 31, 2022 and 2021, respectively.

23.9 Reasonable estimation of expected contribution to plan assets for the next annual reporting period after December 31, 2022 is W 360,000 million.

24. Other Liabilities

Details of other liabilities as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Other financial liabilities
Other payables		3,615,980		2,555,217
Prepaid card and debit card payables		1,840		1,237
Accrued expenses		2,915,891		1,679,327
Financial guarantee contracts liabilities		78,732		106,298
Deposits for letter of guarantees and others		1,099,789		373,633
Domestic exchange settlement credits		1,734,905		5,121,689
Foreign exchange settlement credits		248,826		167,898
Due to trust accounts		6,327,070		7,204,168
Liabilities incurred from agency relationships		513,621		739,276
Account for agency business		241,910		423,798
Lease liabilities		328,707		336,845
Others		51,054		477,301
		17,158,325		19,186,687
Other non-financial liabilities
Other payables		1,053,097		660,409
Unearned revenue		94,424		51,193
Accrued expenses		528,850		456,491
Withholding taxes		133,917		105,802
Others		46,566		55,116
		1,856,854		1,329,011
		19,015,179		20,515,698

134

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

25. Equity

25.1 Capital Stock

Details of capital stock as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won and in number of shares)	Ordinary shares
	December 31, 2022		December 31, 2021
Type of share		Ordinary share		Ordinary share
Number of authorized shares		1,000,000,000		1,000,000,000
Par value per share (In Korean won)		5,000		5,000
Number of issued shares		404,379,116		404,379,116
Capital stock		2,021,896		2,021,896

25.2 Hybrid Security

Details of hybrid security classified as equity as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Issuance date		Maturity			Interest rate (%)		December 31, 2022		December 31, 2021
Amortized Conditional Capital		July 2, 2019		Permanent	1		4.35		574,523		574,523
Securities		June 23, 2022		Permanent	2		4.89		299,327		—

¹ Above hybrid securities are early redeemable by the Bank after 5 years from the issuance date and each interest payment date thereafter.

² Early redeemable by the Bank only when prior approval from the head of the Financial Supervisory Service is obtained after 5 years from the issuance date.

25.3 Capital Surplus

Details of capital surplus as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Paid-in capital in excess of par value		4,604,417		4,604,417
Gains on business combination		397,669		397,669
Revaluation reserve		177,229		177,229
Other capital surplus		40,716		40,716
		5,220,031		5,220,031

135

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

25.4 Accumulated Other Comprehensive Income

Details of accumulated other comprehensive income as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Remeasurements of net defined benefit liabilities		(115,124	)		(293,014	)
Currency translation differences		3,132			5,154
Losses on debt securities measured at fair value through other comprehensive income		(649,850	)		(188,161	)
Gains on equity securities measured at fair value through other comprehensive income		641,536			1,838,548
Losses on cash flow hedging instruments		33,921			(89	)
		(86,385	)		1,362,438

25.5 Retained Earnings

25.5.1 Details of retained earnings as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Legal reserves		2,043,654		2,043,008
Regulatory reserve for credit losses		2,715,060		2,434,041
Voluntary reserves		17,648,780		16,653,881
Unappropriated retained earnings		3,116,895		2,307,783
		25,524,389		23,438,713

With respect to the allocation of net profit earned in a fiscal term, the Bank must set aside in its legal reserve an amount equal to at least 10% of its profit after tax as reported in the financial statements, each time it pays dividends on its net profits earned until its legal reserve reaches the aggregate amount of its paid-in capital in accordance with Article 40 of the Banking Act. This reserve is not available for the payment of cash dividends, but may be transferred to capital stock, or used to reduce accumulated deficit. The Bank is reserving other reserves (legal reserves) in accordance with local laws and regulations of overseas branches.

136

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

25.5.2 Statement of appropriation of retained earnings (draft)

(Expected date of appropriation for 2022: March 23, 2023)

(Date of appropriation for 2021: March 24, 2022)

(In millions of Korean won)	2022			2021
Unappropriated retained earnings
Unappropriated retained earnings carried over from prior years		53			78
Interim dividend		—			—
Dividends on hybrid securities		(34,400	)		(24,144	)
Reclassification from AOCI to retained earnings due to sale of equity securities measured at fair value through other comprehensive income		243,022			(231,509	)
Profit for the year		2,908,220			2,563,358
		3,116,895			2,307,783
Transfer from voluntary reserves and others
Revaluation gains on property and equipment		18,054			1,301
		18,054			1,301
Appropriation of retained earnings
Voluntary reserves		1,714,800			996,200
Regulatory reserve for credit losses		70,905			281,019
Cash dividends:		1,346,582			1,031,167
(Dividends (rate) per share: W 3,330 (66.6%) in 2022) (Dividends (rate) per share: W 2,550 (51.0%) in 2021)		1,346,582			1,031,167
Other reserves		2,575			645
		3,134,862			2,309,031
Unappropriated retained earnings to be carried forward		87			53

25.5.3 Regulatory reserve for credit losses

Measurement and disclosure of regulatory reserve for credit losses are required in accordance with Articles 29.1 through 29.2 of Regulations on Supervision of Banking Business.

25.5.3.1 Details of regulatory reserve for credit losses as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Amount before appropriation		2,715,060		2,434,041
Amount estimated to be appropriated		70,905		281,019
		2,785,965		2,715,060

137

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

25.5.3.2 Regulatory reserve for credit losses estimated to be appropriated and adjusted profit after provision of regulatory reserve for credit losses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Regulatory reserve for credit losses estimated to be appropriated		70,905		281,019
Adjusted profit after provision of regulatory reserve for credit losses *		2,837,315		2,282,339

* Adjusted profit after provision of regulatory reserve for credit losses is not based on Korean IFRS. It is calculated by reflecting provision of regulatory reserve for credit losses before tax to the net profit.

26. Net Interest Income

Details of interest income, interest expense, and net interest income for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Interest income
Securities measured at fair value through profit or loss		183,342		74,761
Loans measured at fair value through profit or loss		14,426		—
Securities measured at fair value through other comprehensive income		653,017		437,629
Loans measured at fair value through other comprehensive income		6,023		3,003
Due from financial institutions measured at amortized cost		56,728		11,220
Securities measured at amortized cost		602,106		277,529
Loans measured at amortized cost		12,126,138		8,449,821
Others		320,242		236,879
		13,962,022		9,490,842
Interest expense
Deposits		3,988,661		1,741,293
Borrowings		564,108		160,071
Debentures		665,059		403,341
Others		184,992		54,822
		5,402,820		2,359,527
Net interest income		8,559,202		7,131,315

Interest income recognized on impaired loans is W 14,880 million and W 16,541 million for the years ended December 31, 2022 and 2021, respectively.

138

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

27. Net Fee and Commission Income

Details of fee and commission income, fee and commission expense, and net fee and commission income for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Fee and commission income
Banking activity fees		190,874		188,079
Lending activity fees		65,368		73,515
Credit card related fees		369		685
Debit card related fees		590		568
Agent activity fees		327,986		285,528
Trust and other fiduciary fees		214,159		317,243
Acceptances and guarantees fees		60,465		46,221
Foreign currency related fees		135,312		99,020
Securities agency fees		105,477		147,009
Other business account commission on consignment		36,211		39,178
Others		375,419		375,139
		1,512,230		1,572,185
Fee and commission expense
Trading activity related fees *		16,107		12,820
Lending activity fees		44,833		47,861
Credit card related fees		37,349		28,981
Outsourcing related fees		106,009		104,167
Foreign currency related fees		18,890		14,515
Management fees of written-off loans		12,841		16,324
Contributions to external institutions		27,996		23,574
Others		147,379		135,311
		411,404		383,553
Net fee and commission income		1,100,826		1,188,632

* Fees from financial instruments at fair value through profit or loss

139

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

28. Net Gains or Losses on Financial Instruments at Fair Value through Profit or Loss

Net gains or losses on financial instruments at fair value through profit or loss include dividend income, gains or losses arising from changes in fair value, and gains or losses arising from sales and redemptions.

Details of net gains or losses on financial instruments at fair value through profit or loss for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Gains on financial instruments at fair value through profit or loss
Financial assets at fair value through profit or loss:
Debt securities		530,057		384,721
Equity securities		12,425		17,983
		542,482		402,704
Derivatives held for trading:
Interest rate		7,398,966		3,433,166
Currency		13,646,564		7,022,581
Stock or stock index		9,239		42
Credit		39,646		—
Others		1,443		965
		21,095,858		10,456,754
Financial liabilities at fair value through profit or loss		2,938		1,344
Other financial instruments		251		6,753
		21,641,529		10,867,555
Losses on financial instruments at fair value through profit or loss
Financial assets at fair value through profit or loss:
Debt securities		800,076		198,781
Equity securities		3,617		1,130
		803,693		199,911
Derivatives held for trading:
Interest rate		6,568,434		3,369,991
Currency		13,870,247		6,905,375
Stock or stock index		6,587		30,862
Credit		36,268		70
Others		1,258		935
		20,482,794		10,307,233
Financial liabilities at fair value through profit or loss		656		613
Other financial instruments		206		6,840
		21,287,349		10,514,597
Net gains on financial instruments at fair value through profit or loss		354,180		352,958

140

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

29. Net Other Operating Income and Expenses

Details of other operating income and expenses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Other operating income
Gains on financial assets at fair value through other comprehensive income:
Gains on redemption of securities measured at fair value through other comprehensive income		20			2
Gains on disposal of securities measured at fair value through other comprehensive income		12,968			96,516
Gains on financial assets at amortized cost:
Gains on sale of loans measured at amortized cost		27,848			41,783
Gains on redemption of securities measured at amortized cost		—			126
Gains on foreign exchange transactions		9,585,658			2,497,063
Dividend income		9,885			17,882
Others		722,923			294,378
		10,359,302			2,947,750
Other operating expenses
Losses on financial assets at fair value through other comprehensive income:
Losses on redemption of securities measured at fair value through other comprehensive income		2,758			2,172
Losses on disposal of securities measured at fair value through other comprehensive income		30,460			97,990
Losses on financial assets at amortized cost:
Losses on sale of loans measured at amortized cost		3,022			3,560
Losses on redemption of securities measured at amortized cost		—			6
Losses on foreign exchange transactions		9,506,654			2,452,072
Deposit insurance fee		496,137			460,365
Credit guarantee fund fee		283,906			263,297
Others		965,965			487,245
		11,288,902			3,766,707
Net other operating expenses		(929,600	)		(818,957	)

141

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

30. General and Administrative Expenses

30.1 Details of general and administrative expenses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Expenses related to employee
Employee benefits - salaries		1,588,321		1,538,106
Employee benefits - welfare		696,824		644,366
Post-employment benefits - defined benefit plans		166,670		156,340
Post-employment benefits - defined contribution plans		15,491		12,111
Termination benefits		272,615		249,850
Share-based payments		15,169		27,995
		2,755,090		2,628,768
Depreciation and amortization		510,059		503,939
Other general and administrative expenses
Rental expense		57,668		57,578
Tax and dues		159,664		123,208
Communication		32,412		28,193
Electricity and utilities		23,618		22,854
Publication		5,669		6,620
Repairs and maintenance		11,430		12,006
Vehicle		6,004		5,573
Travel		7,349		2,519
Training		19,697		13,166
Service fees		138,549		128,084
Supplies		18,662		17,951
Electronic data processing expenses		218,670		173,508
Others		329,796		283,701
		1,029,188		874,961
		4,294,337		4,007,668

30.2 Share-based Payments

30.2.1 Stock grants

The Bank changed the scheme of share-based payments awarded to executives and employees from stock options to stock grants in November 2007. The stock grants award program is an incentive plan that sets, on grant date, the maximum number of shares that can be awarded. Actual shares to be granted is determined in accordance with achievement of pre-set performance targets over the vesting period.

142

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

30.2.1.1 Details of stock grants linked to long-term performance as of December 31, 2022, are as follows:

(In number of shares)
Stock grants	Grant date	Number of granted shares 1		Vesting conditions 2
Series 80	Mar. 1, 2020		7,982	Services fulfillment, Total Shareholder Return (TSR) 30~50%, and Company and work performance 50~70%
Series 81	Jan. 1, 2021		139,783	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 83	Apr. 1, 2021		15,278	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 85	Jan. 1, 2022		292,777	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%, Services fulfillment, TSR 30%, and EPS and Asset Quality 70%
Series 86	Feb. 1, 2022		1,525	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 87	Mar. 1, 2022		2,599	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 88	Mar. 14, 2022		5,884	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 89	May. 26, 2022		2,363	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 90	Jul. 18, 2022		4,131	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Series 91	Aug. 24, 2022		7,277	Services fulfillment, TSR 0~30%, and Company and work performance 70~100%
Deferred grant in 2016			2,426	Satisfied
Deferred grant in 2017			4,582	Satisfied
Deferred grant in 2018			2,287	Satisfied
Deferred grant in 2019			32,756	Satisfied
Deferred grant in 2020			53,502	Satisfied
Deferred grant in 2021			156,939	Satisfied
			732,091

¹ Granted shares represent the total number of shares initially granted to executives and employees who have residual shares as of December 31, 2022 (Deferred grants are residual shares vested as of December 31, 2022).

² Executives and employees were given the right of choice about the timing of the deferred payment (after the date of retirement), payment ratio, and payment period. Accordingly, a certain percentage of the granted shares is deferred for up to five years after the date of retirement after the deferred grant has been confirmed.

143

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

30.2.1.2 Details of stock grants linked to short-term performance as of December 31, 2022, are as follows:

(In number of shares)

Stock grants *	Grant date	Estimated number of vested shares		Vesting conditions
Stock granted in 2015	Jan. 1, 2015		1,292	Satisfied
Stock granted in 2016	Jan. 1, 2016		4,875	Satisfied
Stock granted in 2017	Jan. 1, 2017		1,998	Satisfied
Stock granted in 2018	Jan. 1, 2018		2,109	Satisfied
Stock granted in 2019	Jan. 1, 2019		41,737	Satisfied
Stock granted in 2010	Jan. 1, 2020		89,888	Satisfied
Stock granted in 2021	Jan. 1, 2021		130,331	Satisfied
Stock granted in 2022	Jan. 1, 2022		134,402	Proportion to service period

* Executives and employees were given the right of choice about the timing of the deferred payment (after the date of retirement), payment ratio, and payment period. Accordingly, a certain percentage of the granted shares is deferred for up to five years after the date of retirement after the deferred grant has been confirmed.

30.2.1.3 Stock grants are measured at fair value using the MonteCarlo simulation model and assumptions used in measuring the fair value as of December 31, 2022, are as follows:

(In Korean won)	Expected exercise period(years)	Risk-free rate (%)	Fair value (market performance condition)	Fair value (non- market performance condition)
Series 80	0.00~3.00	3.78%	43,157~50,973	43,157~50,973
Series 81	0.00~3.00	3.78%	35,905~41,289	43,157~50,973
Series 83	0.25~4.00	3.78%	38,660~43,583	41,548~46,663
Series 85	1.00~4.00	3.78%	33,668~37,813	41,548~46,663
Series 86	1.08~5.00	3.78%	35,486~39,839	39,958~44,859
Series 87	1.16~5.00	3.78%	38,957~46,013	43,157~50,973
Series 88	1.20~5.00	3.78%	37,288~41,862	39,958~44,859
Series 89	1.40~5.00	3.78%	40,943~48,358	43,157~50,973
Series 90	1.55~5.00	3.78%	39,554~44,405	39,958~44,859
Series 91	1.65~5.00	3.78%	37,840~42,481	39,958~44,859
Grant deferred in 2016	0.00~1.00	3.78%	—	46,663~50,973
Grant deferred in 2017	0.00~1.00	3.78%	—	46,663~50,973
Grant deferred in 2018	0.00~1.00	3.78%	—	46,663~50,973
Grant deferred in 2019	—	3.78%	—	50,973
Grant deferred in 2020	0.00~1.00	3.78%	—	46,663~50,973
Grant deferred in 2021	0.00~2.00	3.78%	—	44,859~50,973
Stock granted in 2015	0.00~1.00	3.78%	—	46,663~50,973
Stock granted in 2016	0.00~2.00	3.78%	—	44,859~50,973
Stock granted in 2017	0.00~1.00	3.78%	—	46,663~50,973
Stock granted in 2018	0.00~1.00	3.78%	—	46,663~50,973
Stock granted in 2019	—	3.78%	—	50,973
Stock granted in 2020	0.00~1.00	3.78%	—	46,663~50,973
Stock granted in 2021	0.00~2.00	3.78%	—	44,859~50,973
Stock granted in 2022	1.00~5.00	3.78%	—	39,958~46,663

The Bank uses the volatility of the stock price over the previous year as the expected volatility, and uses the arithmetic mean of the price-dividend ratio of one year before, two years before, and three years before the base year as the dividend yield and uses one-year risk-free rate of Korea Treasury Bond in order to measure the fair value.

144

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

30.2.1.4 The accrued expenses for share-based payments related to stock grants are W 46,740 million and W 53,577 million as of December 31, 2022 and 2021, respectively, and the compensation costs amounting to W 15,169 million and W 27,995 million were recognized for the years ended December 31, 2022 and 2021, respectively.

30.2.2 Mileage stock

30.2.2.1 Details of mileage stock as of December 31, 2022, are as follows:

(In number of shares)

Grant date	Number of granted shares 1		Expected exercise period (years) 2		Remaining shares
Stock granted in 2019
Nov. 1, 2019		119		0.00		48
Nov. 8, 2019		14		0.00		6
Dec. 6, 2019		84		0.00		50
Dec. 5, 2019		56		0.00		41
Dec. 31, 2019		87		0.00		43
Stock granted in 2020
Jan. 18, 2020		28,645		0.00~0.05		15,541
May 12, 2020		46		0.00~0.36		43
Jun. 30, 2020		206		0.00~0.50		147
Aug. 26, 2020		40		0.00~0.65		27
Oct. 29, 2020		160		0.00~0.83		107
Nov. 6, 2020		45		0.00~0.85		37
Nov. 30, 2020		35		0.00~0.92		34
Dec. 2, 2020		57		0.00~0.92		44
Dec. 4, 2020		154		0.00~0.93		110
Dec. 30, 2020		88		0.00~1.00		64
Stock granted in 2021
Jan. 15, 2021		28,156		0.00~1.04		18,712
Apr. 5, 2021		89		0.00~1.26		53
Jul. 1, 2021		54		0.00~1.50		54
Jul. 2, 2021		11		0.00~1.50		11
Jul. 27, 2021		70		0.00~1.57		63
Nov. 1, 2021		71		0.00~1.84		71
Nov. 16, 2021		53		0.00~1.88		48
Dec. 6, 2021		87		0.00~1.93		87
Dec. 3, 2021		91		0.00~1.92		89
Dec. 30, 2021		76		0.00~2.00		76

145

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

30.2.2.1 Details of mileage stock as of December 31, 2022, are as follows: (cont’d)

(In number of shares)

Grant date	Number of granted shares 1		Expected exercise period (years) 2		Remaining shares
Stock granted in 2022
Jan. 14, 2022		20,909		0.00~2.04		19,864
Apr. 4, 2022		65		0.00~2.26		65
Apr. 19, 2022		33		0.00~2.30		33
Jul. 1, 2022		62		0.00~2.50		62
Aug. 3, 2022		62		0.00~2.59		62
Aug. 9, 2022		80		0.00~2.61		76
Oct. 19, 2022		55		0.00~2.80		55
Nov. 1, 2022		177		0.00~2.84		177
Dec. 1, 2022		49		0.00~2.92		49
Dec. 12, 2022		114		0.00~2.95		114
Dec. 6, 2022		88		0.00~2.93		88
Dec. 2, 2022		42		0.00~2.92		42
Dec. 15, 2022		42		0.00~2.96		42
Dec. 30, 2022		114		0.00~3.00		114
		80,486				56,449

¹ Mileage stock is exercisable for two years after one year from the grant date at the closing price of the end of the previous month. However, mileage stock can be exercised at the closing price of the end of the previous month on the date of occurrence of retirement or transfer despite a one-year grace period.

² Assessed based on the stock price as of December 31, 2022. These shares are vested immediately at grant date.

30.2.2.2 The accrued expenses for share-based payments related to mileage stock are W 2,738 million and W 3,465 million as of December 31, 2022 and 2021, respectively. The compensation costs amounting to W 870 million and W 2,116 million were recognized as expenses for the years ended December 31, 2022 and 2021, respectively.

146

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

31. Net Other Non-Operating Income and Expenses

Details of other non-operating income and expenses for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Other non-operating income
Gains on disposal of property and equipment and assets held for sale		47,384			11,269
Rental income		22,541			19,238
Dividend income from subsidiaries and associates		14,844			19,057
Others		19,985			77,180
		104,754			126,744
Other non-operating expenses
Losses on disposal of property and equipment and assets held for sale		1,791			4,809
Donation		62,222			75,330
Restoration costs		2,336			2,743
Others		410,922			38,467
		477,271			121,349
Net other non-operating income (expenses)		(372,517	)		5,395

147

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

32. Income Tax Expense

32.1 Details of income tax expense for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Income tax payable
Current income tax expense		1,280,750			835,456
Adjustments of income tax of prior years recognized in current tax		(125,397	)		5,331
		1,155,353			840,787
Changes in deferred income tax assets and liabilities		(534,646	)		317,361
Income tax expense of overseas branches		33,245			20,920
Income tax recognized directly in equity:
Net gains or losses on debt instruments at fair value through other comprehensive income		162,928			105,519
Remeasurements of net defined benefit liabilities		(67,476	)		27,669
Net gains or losses on equity instruments at fair value through other comprehensive income		466,078			(419,220	)
Gains or losses on cash flow hedging instruments		(12,263	)		(3,787	)
		549,267			(289,819	)
Reclassification from AOCI to retained earnings due to sale of equity securities measured at fair value through other comprehensive income		(92,181	)		87,813
Consolidated tax return effect		(62,854	)		(45,308	)
Income tax expense		1,048,184			931,754

32.2 Analysis of the relationship between net profit before income tax expense and income tax expense for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Profit before income tax expense		3,956,404			3,495,112
Income tax at the applicable tax rate *		1,077,807			950,794
Non-taxable income		(10,300	)		(14,491	)
Non-deductible expenses		8,064			11,539
Tax credit and tax exemption		(1,418	)		—
Temporary difference for which no deferred tax is recognized		134,361			20,168
Income tax refund for tax of prior years		(135,121	)		(17,187	)
Income tax expense of overseas branches		33,245			20,920
Effect of tax rate change		(3,630	)		—
Consolidated tax return effect		(62,854	)		(45,308	)
Others		8,030			5,319
Income tax expense		1,048,184			931,754
Income tax expense/Profit before income tax (%)		26.49			26.66

* Applicable income tax rate for \ 200 million and below is 11%, for over \ 200 million to \ 20 billion is 22%, for over \ 20 billion to \ 300 billion is 24.2% and for over \ 300 billion is 27.5% for the years ended December 31, 2022 and 2021.

148

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

32.3 Details of current tax liabilities (income tax payables) and current tax assets (income tax refund receivables) before offsetting as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Tax payables after offsetting 1, 2		816,447			428,632
Adjustment on consolidated tax payable and others 3		(62,854	)		(45,308	)
Consolidated tax return accounts payables 4		(747,922	)		(377,628	)
Current tax payable		5,671			5,696

¹ Current tax assets of W 172,757 million and W 44,942 million due to uncertain tax position and current tax assets of W 14,260 million and W 6,249 million for overseas branches were excluded, which does not qualify for offsetting as of December 31, 2022 and 2021, respectively.

² Includes income tax payable of W 5,671 million and W 5,696 million under current tax liabilities, which are not to be offset against any income tax refund receivables, such as those of overseas branches as of December 31, 2022 and 2021, respectively.

³ Tax expense reduced due to the adoption of consolidated tax return was recognized as tax benefit.

⁴ The amount of income tax payable is reclassified as accounts payable, not to the tax authority, but to KB Financial Group Inc. due to the adoption of consolidated tax return.

33. Dividends

The annual dividends to the shareholder of the Bank for the year ended December 31, 2022, amounting to W 1,346,582 million (W 3,330 per share) is to be proposed at the general shareholder’s meeting scheduled for March 23, 2023. The Bank’s financial statements as of and for the year ended December 31, 2022, do not reflect this dividend payable.

149

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

34. Accumulated Other Comprehensive Income (Loss)

Changes in accumulated other comprehensive income (loss) for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Beginning			Changes (excluding reclassification)			Reclassification to profit or loss		Tax effect			Transfer to retained earnings			Ending
Remeasurements of net defined benefit liabilities		(293,014	)		245,366			—		(67,476	)		—			(115,124	)
Currency translation differences		5,154			(2,022	)		—		—			—			3,132
Gains (losses) on debt securities measured at fair value through other comprehensive income		(188,161	)		(927,330	)		302,713		162,928			—			(649,850	)
Gains on equity securities measured at fair value through other comprehensive income		1,838,548			(1,327,887	)		—		466,078			(335,203	)		641,536
Losses on cash flow hedging instruments		(89	)		43,885			2,388		(12,263	)		—			33,921
		1,362,438			(1,967,988	)		305,101		549,267			(335,203	)		(86,385	)

	2021
(In millions of Korean won)	Beginning			Changes (excluding reclassification)			Reclassification to profit or loss		Tax effect			Transfer to retained earnings		Ending
Remeasurements of net defined benefit liabilities		(220,068	)		(100,615	)		—		27,669			—		(293,014	)
Currency translation differences		1,197			3,957			—		—			—		5,154
Gains (losses) on debt securities measured at fair value through other comprehensive income		90,025			(386,809	)		3,104		105,519			—		(188,161	)
Gains on equity securities measured at fair value through other comprehensive income		733,332			1,205,112			—		(419,220	)		319,324		1,838,548
Losses on cash flow hedging instruments		(10,073	)		11,468			2,303		(3,787	)		—		(89	)
		594,413			733,113			5,407		(289,819	)		319,324		1,362,438

150

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

35. Trust Accounts

35.1 Financial information of the trust accounts the Bank manages, as of and for the years ended December 31, 2022 and 2021, are as follows:

	Total assets				Operating revenues
(In millions of Korean won)	December 31, 2022		December 31, 2021		2022		2021
Consolidated		4,192,712		4,372,406		122,144		92,012
Unconsolidated (non-guaranteed)		76,695,803		68,491,476		1,996,658		2,002,166
		80,888,515		72,863,882		2,118,802		2,094,178

* Financial information of the trust accounts has been prepared in accordance with the Statement of Korea Accounting Standard No.5004, Trust Accounts, and enforcement regulations of the Financial Investment Services under the Financial Investment Services and Capital Markets Act.

35.2 Significant receivables and payables related to the Bank’s trust accounts as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Trust segment	Receivables
	Accrued trust fees		70,014		60,116
	Other accrued income		27,376		23,848
			97,390		83,964
	Payables
	Due to trust accounts		2,098,578		1,188,976
	Accrued interest on due to trust accounts		8,727		4,119
	Deposits		686,394		485,126
	Accrued interest on deposits		5,641		1,735
			2,799,340		1,679,956
Custody segment	Receivables
	Accrued trust fees		8,461		7,692
	Payables
	Due to trust accounts		4,228,492		6,015,192
	Accrued interest on due to trust accounts		10,820		3,599
			4,239,312		6,018,791

151

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

35.3 Significant revenues and expenses related to the Bank’s trust accounts for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		2022		2021
Trust segment	Revenues
	Fees and commissions from trust accounts		176,090		280,563
	Management fees and commissions from retirement pension		30,797		28,387
	Commissions from early termination in trust accounts		13		36
			206,900		308,986
	Expenses
	Interest expenses on due to trust accounts		38,187		12,762
	Interest expenses on deposits		19,655		4,868
			57,842		17,630
Custody segment	Revenues
	Fees and commissions from trust accounts		38,069		36,680
	Expenses
	Interest expenses on due to trust accounts		83,797		20,471

35.4 Details of carrying amounts of the trust accounts for which the Bank guarantees payment of principal or payment of principal and fixed rate of return as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Trust accounts guaranteeing repayment of principal	Old age pension		1,191		1,316
	Personal pension		1,813,544		1,875,315
	Pension		2,243,064		2,353,669
	Retirement		8,065		8,251
	New personal pension		84,444		87,429
	New old age pension		2,967		3,418
	Retail		10,499		10,939
	Corporate		1,299		1,303
	Installment		13,450		14,796
			4,178,523		4,356,436
Trust accounts guaranteeing repayment of principal and fixed rate of return	Development money		14,112		15,876
	Unspecified monetary		77		94
			14,189		15,970
			4,192,712		4,372,406

* Financial information of the trust accounts has been prepared in accordance with the Statement of Korea Accounting Standard 5004, Trust Accounts, and enforcement regulations of the Financial Investment Services under the Financial Investment Services and Capital Markets Act.

There is no amount the Bank has to pay in relation to the management results of the trust accounts in accordance with the guarantees of payment of principal or payment of principal and fixed rate of return as of December 31, 2022 and 2021.

152

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

36. Statement of Cash Flows

36.1 Details of cash and cash equivalents as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022			December 31, 2021
Cash		2,227,291			2,181,314
Checks issued by other banks		123,163			150,047
Due from the Bank of Korea		15,963,883			16,038,651
Due from other financial institutions		3,981,907			3,998,892
		22,296,244			22,368,904
Deduction:
Restricted due from financial institutions *		(302,456	)		(461,003	)
Due from financial institutions with original maturities over three months		(644	)		(35,860	)
		(303,100	)		(496,863	)
		21,993,144			21,872,041

* Items that meet the definition of cash are excluded in accordance with Korean IFRS No.1007 Statement of Cash Flows. Detailed information on the effects of this change in accounting policy is described in Note 2.1 Application of Korean IFRS.

Items that meet the definition of cash in restricted due from financial institutions as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		Financial institutions	December 31, 2022		December 31, 2021
Due from financial institutions in Korean won	Due from the Bank of Korea	The Bank of Korea		15,169,704		15,117,033
Due from financial institutions in foreign currencies	Due from banks in foreign currencies	The Bank of Korea		794,180		721,618
		Bank Indonesia and others		49,649		39,287
				16,013,533		15,877,938

36.2 Significant non-cash transactions for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022			2021
Write-offs of loans		360,014			391,378
Changes in accumulated other comprehensive income from valuation of debt securities measured at fair value through other comprehensive income		(461,689	)		(278,186	)
Changes in accumulated other comprehensive income from valuation of equity securities measured at fair value through other comprehensive income		(1,197,012	)		1,105,216
Changes in financial investments due to debt-for-equity swap		—			327

153

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

36.3 Cash inflows and outflows from income tax, interest, and dividends for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Activities		2022		2021
Income tax paid		Operating		850,021		1,003,334
Interest received		Operating		13,676,404		9,660,267
Interest paid		Operating		4,235,972		2,501,310
Dividends received		Operating		175,630		182,952
Dividends paid		Financing		1,031,167		917,941
Interest (dividends) paid on hybrid securities		Financing		34,399		24,144

36.4 Changes in liabilities arising from financing activities for the years ended December 31, 2022 and 2021, are as follows:

	2022
(In millions of Korean won)	Derivatives held for hedging *			Borrowings		Debentures			Due to trust accounts			Lease liabilities			Deposits for letter of guarantees		Total
Beginning		(88,125	)		31,073,908		26,891,141			7,204,168			336,844			373,633		65,791,569
Cash flow		33,287			12,013,037		928,113			(877,098	)		(156,277	)		725,802		12,666,864
New lease and termination		—			—		—			—			140,598			—		140,598
Exchange differences		—			577,429		454,390			—			—			—		1,031,819
Changes in fair values		97,907			—		(293,570	)		—			—			—		(195,663	)
Other changes from non-cash transactions		(35,349	)		296		19,342			—			7,542			354		(7,815	)
Ending		7,720			43,664,670		27,999,416			6,327,070			328,707			1,099,789		79,427,372

	2021
(In millions of Korean won)	Derivatives held for hedging *			Borrowings			Debentures			Due to trust accounts			Lease liabilities			Deposits for letter of guarantees			Total
Beginning		(142,840	)		25,099,647			24,690,676			7,715,547			342,811			438,885			58,144,726
Cash flow		5,870			5,338,985			1,839,500			(511,379	)		(161,561	)		(66,635	)		6,444,780
New lease and termination		—			—			—			—			155,594			—			155,594
Exchange differences		—			635,386			476,790			—			—			—			1,112,176
Changes in fair values		41,762			—			(126,418	)		—			—			—			(84,656	)
Other changes from non-cash transactions		7,083			(110	)		10,593			—			—			1,383			18,949
Ending		(88,125	)		31,073,908			26,891,141			7,204,168			336,844			373,633			65,791,569

* Derivatives held for hedging purposes are the net amount after offsetting liabilities and assets.

154

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

37. Contingent Liabilities and Commitments

37.1 Details of acceptances and guarantees as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Confirmed acceptances and guarantees
Confirmed acceptances and guarantees in Korean won:
Acceptances and guarantees for KB purchasing loan		167,538		136,914
Performance bond		3,476		3,476
Refund guarantees		9,259		27,811
Others		905,934		786,185
		1,086,207		954,386
Confirmed acceptances and guarantees in foreign currencies:
Acceptances of letter of credit		502,217		523,036
Letter of guarantees		78,414		83,089
Bid bond		19,998		18,874
Performance bond		976,008		855,247
Refund guarantees		1,705,796		874,173
Others		3,010,650		1,957,939
		6,293,083		4,312,358
Financial guarantee contracts:
Acceptances and guarantees for issuance of debenture		5,040		5,040
Acceptances and guarantees for mortgage		94,861		51,053
Overseas debt guarantees		713,431		547,253
International financing guarantees in foreign currencies		181,241		132,114
Other financial guarantees in Korean won		—		50,948
		994,573		786,408
		8,373,863		6,053,152
Unconfirmed acceptances and guarantees
Guarantees of letter of credit		3,024,034		3,515,378
Refund guarantees		1,528,359		833,765
		4,552,393		4,349,143
		12,926,256		10,402,295

155

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

37.2 Credit qualities of acceptances and guarantees as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Total
(In millions of Korean won)			Non-impaired		Impaired
Confirmed acceptances and guarantees *
Grade 1		6,391,453		1,140		—		6,392,593
Grade 2		1,562,960		10,474		—		1,573,434
Grade 3		100,345		16,290		—		116,635
Grade 4		63,689		215,382		442		279,513
Grade 5		—		4,130		7,558		11,688
		8,118,447		247,416		8,000		8,373,863
Unconfirmed acceptances and guarantees *
Grade 1		3,218,676		844		—		3,219,520
Grade 2		1,035,680		36,879		—		1,072,559
Grade 3		4,685		13,308		—		17,993
Grade 4		1,265		236,687		5		237,957
Grade 5		—		199		4,165		4,364
		4,260,306		287,917		4,170		4,552,393
		12,378,753		535,333		12,170		12,926,256

	December 31, 2021
	12-month expected credit losses		Lifetime expected credit losses				Total
(In millions of Korean won)			Non-impaired		Impaired
Confirmed acceptances and guarantees *
Grade 1		4,564,011		20		—		4,564,031
Grade 2		1,169,192		32,567		—		1,201,759
Grade 3		72,567		46,174		—		118,741
Grade 4		7,651		149,785		214		157,650
Grade 5		—		774		10,197		10,971
		5,813,421		229,320		10,411		6,053,152
Unconfirmed acceptances and guarantees *
Grade 1		3,074,136		3,391		—		3,077,527
Grade 2		971,315		39,224		—		1,010,539
Grade 3		12,039		34,797		—		46,836
Grade 4		11,925		195,794		—		207,719
Grade 5		—		138		6,384		6,522
		4,069,415		273,344		6,384		4,349,143
		9,882,836		502,664		16,795		10,402,295

* Applied same criteria as the credit qualities classification of loans.

156

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

37.3 Classifications of acceptances and guarantees by counterparty as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Confirmed guarantees		Unconfirmed guarantees		Total		Proportion (%)
Large companies		7,478,656		3,805,384		11,284,040		87.30
Small and medium-sized companies		659,701		483,013		1,142,714		8.84
Public sector and others		235,506		263,996		499,502		3.86
		8,373,863		4,552,393		12,926,256		100.00

	December 31, 2021
(In millions of Korean won)	Confirmed guarantees		Unconfirmed guarantees		Total		Proportion (%)
Large companies		5,316,222		3,361,712		8,677,934		83.42
Small and medium-sized companies		642,474		641,752		1,284,226		12.35
Public sector and others		94,456		345,679		440,135		4.23
		6,053,152		4,349,143		10,402,295		100.00

37.4 Classifications of acceptances and guarantees by industry as of December 31, 2022 and 2021, are as follows:

	December 31, 2022
(In millions of Korean won)	Confirmed guarantees		Unconfirmed guarantees		Total		Proportion (%)
Financial institutions		815,133		2,012		817,145		6.32
Manufacturing		3,571,866		3,576,251		7,148,117		55.30
Service		739,166		31,465		770,631		5.96
Wholesale and retail		2,165,401		658,875		2,824,276		21.85
Construction		401,782		47,465		449,247		3.48
Public sector		32,635		81,607		114,242		0.88
Others		647,880		154,718		802,598		6.21
		8,373,863		4,552,393		12,926,256		100.00

	December 31, 2021
(In millions of Korean won)	Confirmed guarantees		Unconfirmed guarantees		Total		Proportion (%)
Financial institutions		405,916		10,114		416,030		4.00
Manufacturing		2,681,556		2,957,619		5,639,175		54.21
Service		660,908		38,920		699,828		6.73
Wholesale and retail		1,564,145		990,270		2,554,415		24.56
Construction		297,700		38,260		335,960		3.23
Public sector		28,050		99,841		127,891		1.23
Others		414,877		214,119		628,996		6.04
		6,053,152		4,349,143		10,402,295		100.00

157

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

37.5 Details of commitments as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Commitments
Corporate loan commitments		50,380,036		44,524,865
Retail loan commitments		50,974,278		46,795,678
Other commitments in Korean won		1,700,000		1,300,000
Purchase of other securities		5,070,170		4,140,069
		108,124,484		96,760,612
Financial guarantee contracts
Credit line		6,100,082		4,858,585
Purchase of securities		1,809,045		2,926,872
		7,909,127		7,785,457
		116,033,611		104,546,069

158

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

37.6 Other Matters (including litigation)

The Bank has 36 pending lawsuits as a plaintiff (excluding simple lawsuits related to the collection or management of loans), with aggregate claims amount of \ 1,016,421 million, and details of pending lawsuits in which the Bank is a defendant as of December 31, 2022, are as follows:

(In number of cases, in millions of Korean won)

Lawsuits	No. of cases		Amount		Description of the lawsuits	Status of the lawsuits
Request for a return of redemption amount		1		53,239	Kookmin Bank invested the assets entrusted by OO Asset Management and OO Investment Trust Management in the Fairfield Sentry Limited, and Fairfield Sentry Limited reinvested the assets in Bernard L. Madoff Investment Securities LLC managed by Bernard Madoff (Bernard L. Madoff Investment Securities LLC is in the liquidation process due to Ponzi scheme fraud-related losses). Bankruptcy trustee of Bernard L. Madoff Investment Securities LLC filed a lawsuit against Kookmin Bank seeking to return the amount of redemptions received by Kookmin Bank through Fairfield Sentry Limited.	Application for incineration by the defendant has been denied, and further proceedings are scheduled. [Related litigation is in progress at the New York Southern District Bankruptcy Court (10-3777) at the written complaint review stage]
Confirm the absence of debt		1		96,200	Galamat-Art LLP is a joint guarantor of the PF loan for the ‘Kazakhstan Almaty City Complex Development Project’ in which Kookmin Bank participated as a lender. OO Bank, the agent bank of the lending group, filed a provisional seizure and a lawsuit on the merits of the guarantee debt to the local court against Galamat-Art LLP. And Galamat-Art LLP filed a counterclaim against the lenders, including Kookmin Bank, to confirm the absence of debt denying the joint guarantee obligation.	The Bank won the case in the first and second trials, and the plaintiff’s appeal (appeal deadline: April 19, 2023) is being monitored.
Expropriation of long-term leasehold rights		1		316,825	The Bank invested assets entrusted by DAOL Asset Management Co., Ltd. in loans that are directly or indirectly collateralized by the building and land leasehold rights (hereinafter referred to as “the real estate in this case”) of Union Station in Washington, D.C., the United States. The Plaintiff, who is the operator of the railway facility, filed this lawsuit against the stakeholders of the real estate in this case, including the Bank, to expropriate the real estate in this case and determine indemnity.	The Bank submitted the response letter and will proceed with the process in the future.
Others		101		196,068	Others (excluding simple lawsuits related to the collection or management of loans)
		104		662,332

159

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

38. Subsidiaries

38.1 Details of subsidiaries as of December 31, 2022, are as follows:

Investor	Investee	Ownership (%)	Location	Industry
Kookmin Bank	Kookmin Bank Cambodia Plc.	100.00	Cambodia	Banking and foreign exchange transaction
Kookmin Bank	Kookmin Bank (China) Ltd.	100.00	China	Banking and foreign exchange transaction
Kookmin Bank	KB Microfinance Myanmar Co., Ltd.	100.00	Myanmar	Microfinance services
Kookmin Bank	KB Bank Myanmar Co., Ltd.	100.00	Myanmar	Banking and foreign exchange transaction
Kookmin Bank	PRASAC Microfinance Institution Plc.	99.99	Cambodia	Microfinance services
Kookmin Bank	PT Bank KB Bukopin Tbk	67.00	Indonesia	Banking and foreign exchange transaction
PT Bank KB Bukopin Tbk	PT Bank Syariah Bukopin	92.78	Indonesia	Banking
PT Bank KB Bukopin Tbk	PT Bukopin Finance	97.04	Indonesia	Installment financing
Kookmin Bank	Orient Kwang-yang Co., Ltd. 2	36.16	Korea	Building of ships
Orient Kwang-yang Co., Ltd.	YoulChon Clean Energy Co., Ltd.	100.00	Korea	Other power generation
Kookmin Bank	Personal pension trust and 10 others 1	0.00	Korea	Trust
Kookmin Bank	KBL Incheon 1st L.L.C. and 48 others 2	0.00	Korea	Asset-backed securitization and others
Kookmin Bank	KB Wise Star Private Real Estate Feeder Fund No.1 2	86.00	Korea	Investment trust
Kookmin Bank	Kiwoom Frontier Private Securities Fund No.10 (Bond) 2	99.36	Korea	Investment trust
Kookmin Bank	Woori SafePlus Private Securities Fund S-8 2	90.85	Korea	Investment trust
Kookmin Bank	NH-Amundi Global Private Securities Investment Trust No.1 (USD) (Bond) 2	99.86	Korea	Investment trust
Kookmin Bank	Meritz Private Real Estate Fund No.9-2 2	99.98	Korea	Investment trust
Kookmin Bank	AIP US Red Private Real Estate Trust No.10 2	99.97	Korea	Investment trust
Kookmin Bank	KB KBSTAR 3-Year Futures Inverse Securities ETF (Debt-Derivative) 2	81.53	Korea	Investment trust
Kookmin Bank	KB Core Blind Private Real Estate Fund No.1 2	90.09	Korea	Investment trust
KB Core Blind Private Real Estate Fund No.1	KB Wise Star Real Estate Fund No.3 2	46.65	Korea	Investment trust
Kookmin Bank	KB Global Private Real Estate Debt Fund No.3 (USD) 2	99.50	Korea	Investment trust
Kookmin Bank	Samsung SRA Private Real Estate Investment Trust No.28D 2	99.50	Korea	Investment trust
Kookmin Bank	KB Global Private Real Estate Debt Fund No.10 2	99.83	Korea	Investment trust

160

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

38.1 Details of subsidiaries as of December 31, 2022, are as follows: (cont’d)

Investor	Investee	Ownership (%)	Location	Industry
Kookmin Bank	KTB Global CREDebt No.52 2	99.44	Korea	Investment trust
Kookmin Bank	Hyundai Invest KKR Europe Real Estate No.1-3 2	99.01	Korea	Investment trust
Kookmin Bank	KBSTAR FKTB 5Y Duration Following ETF 2	99.60	Korea	Investment trust
Kookmin Bank	Vestas Investors Private Real Estate Fund Investment Trust No.69-3 2	99.52	Korea	Investment trust
Kookmin Bank	KB KBSTAR FKTB 5Y Duration Following ETF 2	99.60	Korea	Investment trust
Kookmin Bank	SHINHAN ASP PCF II Private Investment Trust No.2 (USD) 2	99.75	Korea	Investment trust
Kookmin Bank	Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-1 2	97.40	Korea	Investment trust
Kookmin Bank	Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-2 2	97.40	Korea	Investment trust
Kookmin Bank	KB KBSTAR KTB 10Y Futures ETF 2	65.13	Korea	Investment trust
Kookmin Bank	VI ESG Private Securities Investment Trust No.1 (Bond) 2	100.00	Korea	Investment trust
Kookmin Bank	SHINHAN Aim Private Real Estate Fund Investment Trust No.26-C (USD) 2	99.98	Korea	Investment trust
Kookmin Bank	KB KBSTAR KTB 3Y Futures ETF 2	93.77	Korea	Investment trust
Kookmin Bank	SAMSUNG KODEX 10Y F-LKTB INVERSE ETF 2	95.53	Korea	Investment trust
Kookmin Bank	KB KBSTAR Nov 2025 Term Credit ETF 2	65.45	Korea	Investment trust

¹ The Bank controls the trust because it has power to determine the management performance of the trust and is exposed to variable returns that absorb losses through the guarantees of payment of principal, or payment of principal and fixed rate of return.

² The Bank controls these investees because it is significantly exposed to variable returns from the investees’ performance and has ability to affect those returns through its power.

The Bank holds more than half of the ownership interests of Koreit BN Private Equity Fund and five other investment trusts but does not have the power over relevant activities in accordance with agreements with trust and other shareholders, therefore these entities are not consolidated.

161

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

38.2 The condensed financial information of major subsidiaries as of and for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022							2022
	Assets		Liabilities		Equity			Operating revenue		Profit (loss) for the period *
Kookmin Bank Cambodia Plc.		677,093		536,616		140,477			40,295		13,581
Kookmin Bank (China) Ltd.		3,666,107		3,164,601		501,506			230,027		(869	)
KB Microfinance Myanmar Co., Ltd.		20,111		9,475		10,636			5,379		(1,164	)
PRASAC Microfinance Institution Plc.		6,083,323		4,999,794		1,083,529			1,095,307		233,852
PT Bank KB Bukopin Tbk		6,533,161		6,661,179		(128,018	)		410,422		(802,084	)
KB Bank Myanmar Co., Ltd.		262,478		13,655		248,823			3,252		(1,333	)
Personal pension trust and 10 others		4,120,682		4,077,223		43,459			115,566		(76,182	)

(In millions of Korean won)	December 31, 2021						2021
	Assets		Liabilities		Equity		Operating revenue		Profit (loss) for the period *
Kookmin Bank Cambodia Plc.		559,442		440,502		118,940		28,032		11,694
Kookmin Bank (China) Ltd.		3,812,297		3,295,555		516,742		182,989		14,064
KB Microfinance Myanmar Co., Ltd.		16,549		3,507		13,042		6,020		(6,249	)
PRASAC Microfinance Institution Plc.		5,128,845		4,329,971		798,874		796,169		205,342
PT Bank KB Bukopin Tbk		6,958,949		6,320,222		638,727		413,973		(272,526	)
KB Bank Myanmar Co., Ltd.		242,396		8,409		233,987		480		(3,005	)
Personal pension trust and 10 others		4,381,035		4,261,394		119,641		95,531		2,333

* Includes net profit and loss of the non-controlling interests

38.3 The Characteristics of Risks Associated with Consolidated Structured Entities

The terms of contractual arrangements to provide financial support to consolidated structured entities are as follows:

38.3.1 The Bank has provided capital commitments to consolidated investment funds.

	December 31, 2022
(In millions of Korean won)	Capital commitments		Unused amount
Meritz Private Real Estate Fund No.9-2		63,352		913
KTB Global CREDebt No.52		63,365		12,564
Hyundai Invest KKR Europe Real Estate No.1-3		54,048		19,228
Vestas Investors Private Real Estate Fund Investment Trust No.69-3		81,107		35,139
SHINHAN ASP PCF II Private Investment Trust No.2 (USD)		25,346		4,540
Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-1		67,258		53,914
SHINHAN Aim Private Real Estate Fund Investment Trust No.26-C (USD)		82,375		63,650

162

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

38.3.2 The Bank has provided purchase commitment and credit line to consolidated structured entities. The purchase commitment guarantees that the Bank will purchase and pay any remaining commercial paper securities issued by consolidated structured entities. The credit line agreement requires the Bank to provide loans under certain conditions if there is a reason for suspension of issuance of commercial paper securities or if consolidated structured entities become insolvency due to other reasons.

(In millions of Korean won)	December 31, 2022
KBL Incheon 1st L.L.C.		101,000
KB DTower 1st L.L.C.		50,510
KBH the 4th L.L.C.		12,200
Great Forest the 1st L.L.C.		10,200
KBH the 6th L.L.C.		50,106
Beomuh Landmark the 2nd L.L.C.		45,600
K Plus the 1st L.L.C.		110,279
KB Livv H 1st L.L.C.		30,097
Livv H 1st L.L.C.		50,152
KB Eagles 1st Co., Ltd.		30,097
KB Manchon Harrington Co., Ltd.		6,220
KB Livv l 1st Co., Ltd.		15,188
KB Cheongla Hill Co., Ltd.		60,550
KB Dong-in Central L.L.C.		20,094
KB Eagles 2nd Co., Ltd.		50,182
KBH Steal Co., Ltd.		150,204
KB Penta Co., Ltd.		20,910
KB Great Bear 1st L.L.C.		10,249
Ryan Mobility 1st L.L.C.		50,105
KB Chemical 1st Co., Ltd.		50,158
KB Harim 1st L.L.C.		30,139
KB Eagles 3rd Co., Ltd.		50,164
KB Winchest 1st Co., Ltd.		10,500
KB Dong-in Central 1st L.L.C.		300
LEP 2nd Co., Ltd.		10,000
KB River County L.L.C.		29,000
KB Buamsamjung 1st Co., Ltd.		36,039
Liiv H 2nd Co., Ltd.		30,028
KB Sungnae 1st L.L.C.		65,000
JT Capital 7th Asset Securitization Specialty Company		15,600
KB Landscape 1st L.L.C.		72,900
KB Pride 1st L.L.C.		23,250
KB Pride 2nd L.L.C.		30,184
KB Moonheung 1st Co., Ltd.		160
KB One West 1st Co., Ltd.		1,164
KB Cloud L.L.C.		10,831
K Gowoon Sekyo 1st Co., Ltd.		644
K Gowoon Sekyo 2nd Co., Ltd.		1,341
KB Great29 1st Co., Ltd.		57,600
IDMB UNITED PTE.LTD.		259,797
Liiv H 3rd Co., Ltd.		50,595

163

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

38.3.3 The Bank has provided the guarantees of payment of principal, or principal and fixed rate of return in case the operating results of the trusts are less than the guaranteed principal, or principal and fixed rate of return.

38.4 Changes in Subsidiaries

NICE WONHO 1st Co., Ltd. and 24 other subsidiaries were newly included in the scope of consolidation, and KB Happy 1st L.L.C. and 28 other subsidiaries were excluded from the scope of consolidation for the year ended December 31, 2022.

164

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

39. Lease

39.1 The Bank as a Lessee

39.1.1 Amounts recognized in the statements of financial position related to lease as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Right-of-use property and equipment: *
Real estate		328,375		329,314
Vehicles		8,245		7,614
Others		3,552		5,467
		340,172		342,395
Right-of-use intangible assets *		2,602		3,610
		342,774		346,005
Lease liabilities *		328,708		336,845

* Included in property and equipment, intangible assets, and other liabilities.

39.1.2 Amounts recognized in the statements of comprehensive income related to lease for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022		2021
Depreciation and amortization of right-of-use assets:
Real estate		179,219		184,235
Vehicles		9,927		10,050
Others		2,423		3,700
Intangible asset		1,007		1,007
		192,576		198,992
Interest expenses on the lease liabilities		7,541		5,568
Expense relating to short-term lease		2,294		2,161
Expense relating to lease of low-value assets that are not short-term lease		2,071		1,873

Total cash outflows for lease for the years ended December 31, 2022 and 2021 are W 160,642 million and W 165,595 million, respectively.

39.2 The Bank as an Operating Lessor

The future minimum lease payments to be received from the non-cancellable lease contracts as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	December 31, 2022		December 31, 2021
Up to 1 year		12,290		9,844
1-5 years		16,654		15,980
		28,944		25,824

165

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40. Related Party Transactions

According to Korean IFRS No.1024, the Bank includes the Parent, subsidiaries, the Parent’s subsidiaries, associates, associates of the Parent’s subsidiaries, associates of the Parent, key management personnel (including family members), and post-employment benefit plans of the Bank and its related party companies in the scope of related parties. The Bank discloses balances (receivables and payables) and other amounts arising from transactions with related parties in the notes to the financial statements. Refer to Note 13 for details of investments in associates.

Key management personnel include the executives of the Parent Company and the executives (managing director and above) of the Bank, and companies where the executives and/or their close family members have control or joint control.

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		2022		2021
Parent
KB Financial Group Inc.	Fee and commission income		9,493		7,440
	Other non-operating income		1,985		1,638
	Interest expense		6,345		1,708
	Other operating expenses		—		273
	General and administrative expenses		1,262		926
Subsidiaries
Kookmin Bank Cambodia Plc.	Interest income		8,254		1,613
	Fee and commission income		48		37
	Other non-operating income		522		294
Kookmin Bank (China) Ltd.	Interest income		18,236		9,188
	Fee and commission income		311		287
KB Microfinance Myanmar Co., Ltd.	Fee and commission income		117		—
	Reversal of credit losses		4		—
	Other non-operating income		206		177
	Provision for credit losses		—		16
KB Bank Myanmar Co., Ltd.	Other non-operating income		81		104
PRASAC Microfinance Institution Plc.	Interest income		15,348		8,121
	Fee and commission income		1,954		1,160
	Reversal of credit losses		18		—
	Provision for credit losses		—		266
PT Bank KB Bukopin Tbk	Interest income		35,417		2,455
	Fee and commission income		353		1,180
	Reversal of credit losses		—		546
	Provision for credit losses		882		—
Orient Kwang-yang Co., Ltd.	Interest expense		54		—
Trust	Fee and commission income		12,906		9,586
	Interest expense		6,833		1,612
KB Wise Star Private Real Estate Feeder Fund No.1	Fee and commission income		23		23

166

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
Securitization SPE	Interest expense		1		1
Structured entities	Interest income		12,434		1,080
	Fee and commission income		13,407		20,198
	Gains on financial instruments at fair value through profit or loss		1,194		11,478
	Reversal of credit losses		95		38
	Interest expense		3		1
	Losses on financial instruments at fair value through profit or loss		37,628		28,513
	Provision for credit losses		1,408		313
KB Haeorum Private Securities Fund No.83 (Bond) *	Fee and commission income		10		40
NH-Amundi Global Private Securities Investment Trust No.1 (USD) (Bond)	Fee and commission income		4		4
KB Core Blind Private Real Estate Fund No.1	Interest income		290		290
	Fee and commission income		10		10
KB Global Private Real Estate Debt Fund No.3 (USD)	Fee and commission income		3		2
KB Global Private Real Estate Debt Fund No.10	Fee and commission income		8		5
Samsung Credit Value Plus Professional Investment Type Private Securities Fund (Bond) *	Fee and commission income		2		10
KB Emerging Markets Dept Private Securities Fund(USD)(Bond) *	Fee and commission income		1		17
Samsung SRA Private Real Estate Investment Trust No.28D	Fee and commission income		3		2
KIM Basic Private Securities Fund No.102 (Bond) *	Fee and commission income		3		13
NH-Amundi Private Securities Investment Trust S5(USD)(BOND)	Fee and commission income		3		1
Vestas Investors Private Real Estate Fund Investment Trust No.69-3	Fee and commission income		4		—
KB Leaders Private Securities Fund No.23(Bond-Derivatives) *	Fee and commission income		3		—
Hanwha ARIRANG 3 Year Korea Treasury Bond Futures ETF [Bond-Derivatives] *	Fee and commission income		2		—
SHINHAN ASP PCF II Private Investment Trust No.2 (USD)	Gains on financial instruments at fair value through profit or loss		337		—
IDMB UNITED PTE.LTD.	Interest income		63		—
	Fee and commission income		1,887		—
	Provision for credit losses		985		—

167

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
Mirae Asset Triumph Global Privately Placed Feeder Investment Trust No.1 *	Fee and commission income		—		11
UBS Hana Professional Investor Private Investment Trust No.1 (Bond) *	Fee and commission income		—		4
Mirae Asset Triumph Privately Placed Investment Trust No.7 *	Fee and commission income		—		7
KB Korea Short Term Premium Private Securities No.16(USD)(Bond) *	Fee and commission income		—		2
	Losses on financial instruments at fair value through profit or loss		—		1,663
Parent’s subsidiaries
KB Securities Co., Ltd.	Interest income		7,571		2,897
	Fee and commission income		26,105		27,878
	Gains on financial instruments at fair value through profit or loss		235,328		92,627
	Other non-operating income		4,613		4,371
	Interest expense		4,533		2,020
	Fee and commission expense		2,177		716
	Losses on financial instruments at fair value through profit or loss		168,852		108,706
	Provision for credit losses		106		146
	Other non-operating expenses		1		—
	General and administrative expenses		3,233		3,242
KB Asset Management Co., Ltd.	Fee and commission income		2,053		1,959
	Gains on financial instruments at fair value through profit or loss		1,050		178
	Interest expense		143		43
	Fee and commission expense		130		—
	Losses on financial instruments at fair value through profit or loss		9		98
	General and administrative expenses		500		500
KB Real Estate Trust Co., Ltd.	Fee and commission income		315		268
	Other non-operating income		34		35
	Interest expense		258		119
	Fee and commission expense		1,641		1,806
KB Investment Co., Ltd.	Fee and commission income		109		126
	Interest expense		1,647		344

168

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Credit Information Co., Ltd.	Fee and commission income		75		71
	Other non-operating income		165		143
	Interest expense		139		69
	Fee and commission expense		18,142		20,933
KB Data System Co., Ltd.	Fee and commission income		788		432
	Other non-operating income		185		182
	Interest expense		164		61
	Other operating expenses		419		349
	General and administrative expenses		110,623		60,374
KB Life Insurance Co., Ltd.	Interest income		83		—
	Fee and commission income		21,447		17,258
	Gains on financial instruments at fair value through profit or loss		14,050		8,154
	Other non-operating income		56		48
	Interest expense		13		11
	Fee and commission expense		579		956
	Losses on financial instruments at fair value through profit or loss		2,060		414
	Other operating expenses		1		—
	Provision for credit losses		224		—
	General and administrative expenses		890		888
KB Kookmin Card Co., Ltd.	Interest income		9,324		4,945
	Fee and commission income		161,910		167,682
	Gains on financial instruments at fair value through profit or loss		2,087		287
	Reversal of credit losses		178		—
	Other non-operating income		1,473		1,682
	Interest expense		722		736
	Fee and commission expense		1,742		1,222
	Losses on financial instruments at fair value through profit or loss		1,399		363
	Provision for credit losses		—		327
	General and administrative expenses		1,469		1,301
KB Savings Bank Co., Ltd.	Fee and commission income		455		984
	Other non-operating income		31		82
	Interest expense		10		16
	General and administrative expenses		3		6

169

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Capital Co., Ltd.	Interest income		2,186		1,529
	Fee and commission income		3,759		2,900
	Reversal of credit losses		—		245
	Other non-operating income		171		155
	Interest expense		248		74
	Fee and commission expense		119		4
	Provision for credit losses		28		—
	General and administrative expenses		—		139
KB Insurance Co., Ltd.	Interest income		569		303
	Fee and commission income		27,195		26,351
	Gains on financial instruments at fair value through profit or loss		137,527		69,366
	Reversal of credit losses		9		—
	Other non-operating income		2,036		1,842
	Interest expense		180		1,226
	Fee and commission expense		3,953		2,983
	Losses on financial instruments at fair value through profit or loss		33,916		1,333
	Other operating expenses		3		3
	Provision for credit losses		—		10
	Other non-operating expenses		—		11
	General and administrative expenses		13,745		13,590
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Interest income		66		46
	Fee and commission income		146		103
	Gains on financial instruments at fair value through profit or loss		33,293		6,968
	Other non-operating income		89		—
	Interest expense		4,045		3,736
	Fee and commission expense		4,136		4,374
	Losses on financial instruments at fair value through profit or loss		638		652
	General and administrative expenses		963		604

170

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB STAR REIT Co., Ltd.	Interest income		374		—
	Fee and commission income		33		—
	Gains on financial instruments at fair value through profit or loss		96		—
	Interest expense		9		—
	Losses on financial instruments at fair value through profit or loss		13,565		—
KB Hanbando BTL Private Special Asset Fund No.1	Fee and commission income		108		119
KB AMP Infra Private Special Asset Fund No.1(FoFs)	Fee and commission income		8		9
KB AMP Infra Private Special Asset Fund No.13(FoFs)	Fee and commission income		5		1
KB Muni bond Private Securities Fund No.1 (USD)	Fee and commission income		11		11
KB Global Private Real Estate Debt Fund No.1	Fee and commission income		11		10
KB Global Private Real Estate Debt Fund No.11	Fee and commission income		3		1
KB Global Private Real Estate Debt Fund No.15	Fee and commission income		10		2
KB Global Private Real Estate Debt Fund No.17	Fee and commission income		4		—
KB NA COMPASS Energy Private Special Asset Fund *	Fee and commission income		2		7
KB Star Office Private Real Estate Master Fund No.3	Interest expense		—		3
KB Star Office Private Real Estate Feeder Fund No.4	Interest income		760		760
	Fee and commission income		37		37
	Interest expense		7		5
	Provision for credit losses		1		1
KB Global Core Bond Securities Feeder Fund(Bond)	Fee and commission income		16		45
	Gains on financial instruments at fair value through profit or loss		459		1,020
	Losses on financial instruments at fair value through profit or loss		61		280
KB Onkookmin Life Income 20 Feeder Fund (FoFs)	Gains on financial instruments at fair value through profit or loss		—		266
	Losses on financial instruments at fair value through profit or loss		—		48

171

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Onkookmin Life Income 40 Feeder Fund (FoFs)	Gains on financial instruments at fair value through profit or loss		—		261
	Losses on financial instruments at fair value through profit or loss		—		41
KB New Renewable Energy Private Special Asset Fund No.1	Fee and commission income		9		8
KB North America Private Real Estate Debt Fund No.1	Fee and commission income		3		3
	Gains on financial instruments at fair value through profit or loss		2,202		2,502
	Losses on financial instruments at fair value through profit or loss		51		—
KB North America Private Real Estate Debt Fund No.3	Fee and commission income		10		10
	Gains on financial instruments at fair value through profit or loss		9,525		8,580
	Losses on financial instruments at fair value through profit or loss		2,259		536
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)	Fee and commission income		5		4
KB Global Infrastructure Synergy Private Special Asset Fund	Fee and commission income		5		3
	Gains on financial instruments at fair value through profit or loss		76		—
KB BMO Senior Loan Private Special Asset Fund No.1(FOF)	Fee and commission income		10		8
	Gains on financial instruments at fair value through profit or loss		2,515		5,722
	Losses on financial instruments at fair value through profit or loss		2,001		759
KB BMO Senior Loan Private Special Asset Fund No.2(USD)	Fee and commission income		10		8
KB BMO Senior Loan Private Special Asset Fund No.4(USD)	Fee and commission income		4		—
KB BMO Senior Loan Private Special Asset Fund No.5(FOF)	Fee and commission income		6		—
KB New Renewable Green New Deal Private Special Asset No.2	Fee and commission income		8		2
KB Sinansan Line Private Special Asset Fund(SOC)	Fee and commission income		23		12

172

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Korea Short Term Premium Private Securities No.19(USD)(Bond) *	Fee and commission income		—		4
KB Korea Short Term Premium Private Securities No.21(USD)(Bond) *	Fee and commission income		1		5
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *	Fee and commission income		8		3
	Losses on financial instruments at fair value through profit or loss		510		1,306
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *	Fee and commission income		12		2
	Gains on financial instruments at fair value through profit or loss		—		96
	Losses on financial instruments at fair value through profit or loss		15,167		—
KB Korea Short Term Premium Private Securities No.25(USD)(Bond)	Fee and commission income		11		—
	Losses on financial instruments at fair value through profit or loss		2,891		—
KB Korea Short Term Premium Private Securities No.26(USD)(Bond)	Fee and commission income		7		—
	Losses on financial instruments at fair value through profit or loss		1,839		—
KB Korea Short Term Premium Private Securities No.27(USD)(Bond)	Fee and commission income		11		—
	Losses on financial instruments at fair value through profit or loss		3,502		—
KB Korea Short Term Premium Private Securities No.28(USD)(Bond) *	Fee and commission income		10		—
	Losses on financial instruments at fair value through profit or loss		11,191		—
KB Korea Short Term Premium Private Securities No.32(USD)(Bond)	Fee and commission income		5		—
	Gains on financial instruments at fair value through profit or loss		5,377		—
KB Korea Short Term Premium Private Securities No.33(USD)(Bond)	Gains on financial instruments at fair value through profit or loss		1,557		—
KB Multi Alpha Plus Private Fund No.1	Fee and commission income		8		6
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)	Fee and commission income		23		8
KB New Deal Infra Private Special Asset Fund	Fee and commission income		2		—
KB Korea Infrastructure Credit Guarantee Private Special Asset No.1	Fee and commission income		16		5

173

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Wise Star Private Real Estate No.19	Fee and commission income		6		3
Hanwha Europe Credit Private Fund No.16 (FOF)	Gains on financial instruments at fair value through profit or loss		514		36
	Losses on financial instruments at fair value through profit or loss		746		175
KB Logistics Blind Private Real Estate Fund No.1	Interest income		1,129		—
	Fee and commission income		48		2
	Provision for credit losses		2		—
KB Aircraft Private Special Asset Fund No.1	Fee and commission income		13		4
	Gains on financial instruments at fair value through profit or loss		74		—
	Losses on financial instruments at fair value through profit or loss		1,761		3,849
KB Star ESG Prime Mid-Short Bond Securities Feeder Fund(Bond)	Fee and commission income		15		5
KB Oaktree Private Special Asset Fund No.3	Fee and commission income		2		—
KB GK Project Private Special Asset Fund No.3	Fee and commission income		44		—
KB AMP Infra Note Private Special Asset Fund No.14	Fee and commission income		5		—
KB ASF Infra Private Special Asset Fund(FoFs)	Fee and commission income		1		—
	Gains on financial instruments at fair value through profit or loss		48		—
	Losses on financial instruments at fair value through profit or loss		587		—
KB Duke Private Special Asset Fund	Fee and commission income		4		—
KB Star Reits Private Real Estate Feeder Fund No.1	Fee and commission income		2		—
KB Star Reits Private Real Estate Feeder Fund No.2	Fee and commission income		4		—
HSBC Senior UK Direct Lending Fund 2020 RAIF SICAV-S.A.	Fee and commission income		1		—
NB Private Debt Fund IV LUX (B) SCSP	Fee and commission income		1		—
KB Europe Renewable Private Special Asset Fund No.3	Fee and commission income		1		—
KB Senior Loan Private Fund No.1 *	Fee and commission income		—		1

174

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
KB Korea Short Term Premium Private Securities No.15(USD)(Bond) *	Fee and commission income		—		3
	Losses on financial instruments at fair value through profit or loss		—		1,614
KB Korea Short Term Premium Private Securities No.17(USD)(Bond) *	Fee and commission income		—		10
	Losses on financial instruments at fair value through profit or loss		—		6,153
Associates
Korea Credit Bureau Co., Ltd.	Fee and commission income		52		36
	Interest expense		1		6
	Fee and commission expense		1,996		1,860
	Other operating expenses		15		11
Incheon Bridge Co., Ltd.	Interest income		7,516		4,069
	Fee and commission income		23		22
	Reversal of credit losses		28		444
	Interest expense		517		158
	Fee and commission expense		6		6
	Losses on financial instruments at fair value through profit or loss		4,434		1,374
Kendae Co., Ltd.	Other non-operating expenses		3		—
Dongjo Co., Ltd.	Interest income		9		—
Dae-A Leisure Co., Ltd.	Interest expense		—		2
Skydigital Inc.	Fee and commission income		3		3
Il-Kwang Electronic Materials Co., Ltd.	Other non-operating expenses		1		—
So-Myung Recycling Co., Ltd.	Other non-operating expenses		2		—
TMAPMOBILITY CO.,LTD.	Interest expense		226		—
KB High-Tech Company Investment Fund	Interest expense		3		8
Aju Good Technology Venture Fund	Interest expense		108		27
KB-KDBC Pre-IPO New Technology Business Investment Fund	Interest expense		1		1
KB Digital Innovation & Growth New Technology Business Investment Fund	Interest expense		4		3
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Interest expense		6		17
KB Global Platform Fund	Interest expense		114		39
WJ Private Equity Fund No.1	Fee and commission income		7		7
KB Bio Global Expansion Private Equity Fund No.1	Interest expense		9		—
KB Digital Platform Fund	Interest expense		116		—
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 *	Interest expense		2		5
Star-Lord General Investors Private Real Estate Investment Company No.10	Interest income		3,098		—
	Interest expense		60		—
	Provision for credit losses		1		—

175

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
Associates of Parent’s subsidiaries
SY Auto Capital Co., Ltd.	Fee and commission income		4		4
Food Factory Co., Ltd.	Interest income		80		70
	Fee and commission income		1		—
	Reversal of credit losses		1		6
	Interest expense		6		5
	Fee and commission expense		—		2
BIKDIPEO CO.,LTD.	Interest income		1		—
Banksalad Co., Ltd.	Fee and commission income		36		36
Spark Biopharma Inc.	Interest expense		272		7
UPRISE, Inc.	Interest income		—		5
	Reversal of credit losses		—		1
	Interest expense		3		1
Channel Corporation	Interest expense		43		—
COSES GT Co., Ltd.	Interest income		23		18
	Reversal of credit losses		—		3
	Interest expense		1		1
	Provision for credit losses		3		—
KB No.17 Special Purpose Acquisition Company *	Interest expense		1		14
KB No.18 Special Purpose Acquisition Company *	Interest expense		5		20
KB No.19 Special Purpose Acquisition Company *	Interest expense		5		9
KB No.20 Special Purpose Acquisition Company *	Interest expense		22		15
KB No.21 Special Purpose Acquisition Company	Interest expense		30		—
KB No.22 Special Purpose Acquisition Company	Interest expense		1		—
KB No.23 Special Purpose Acquisition Company	Interest expense		23		—
KB No.24 Special Purpose Acquisition Company	Interest expense		1		—
SwatchOn Inc. *	Fee and commission income		5		8
	Interest expense		5		10
Gomi corporation Inc.	Interest income		61		19
	Fee and commission income		1		—
	Interest expense		2		1
	Provision for credit losses		2		13
S&E bio Co., Ltd.	Interest expense		2		1
Contents First Inc.	Interest income		128		—
	Fee and commission income		1		—
	Interest expense		34		83
	Provision for credit losses		1		—

176

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.1 Details of significant profit or loss arising from transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022		2021
GENINUS Inc. *	Interest expense		12		29
Mantisco Co., Ltd.	Interest expense		1		1
Pin Therapeutics Inc.	Interest expense		110		—
SuperNGine Co., Ltd.	Interest expense		—		1
Desilo Inc.	Interest income		9		1
	Provision for credit losses		—		2
Turing Co., Ltd.	Interest expense		1		1
IGGYMOB Co., Ltd.	Interest expense		1		1
Kukka Co., Ltd.	Interest expense		2		—
Zipdoc Inc.	Interest expense		1		—
TeamSparta Inc.	Interest expense		19		—
Chabot Mobility Co., Ltd.	Interest expense		1		—
Wemade Connect Co., Ltd.	Interest expense		81		—
Nextrade Co., Ltd.	Interest expense		263		—
KB Pre IPO Secondary Venture Fund No.1 *	Interest expense		—		1
Others
Retirement pension	Fee and commission income		1,352		1,338
	Interest expense		39		9

* Excluded from the Bank’s related party as of December 31, 2022.

177

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent
KB Financial Group Inc.	Other assets		97		71
	Deposits		231,056		518,076
	Other liabilities		828,908		462,800
Subsidiaries
Kookmin Bank Cambodia Plc.	Cash and due from financial institutions		4,192		2,543
	Loans measured at amortized cost (gross amount)		430,882		343,795
	Other assets		3,795		294
	Deposits		2,364		16,042
	Other liabilities		336		180
Kookmin Bank (China) Ltd.	Cash and due from financial institutions		65,523		83,041
	Loans measured at amortized cost (gross amount)		728,698		1,293,871
	Other assets		5,177		5,043
	Deposits		1,960		3,374
	Borrowings		267,164		225,870
KB Microfinance Myanmar Co., Ltd.	Provisions		45		49
	Other liabilities		25		24
KB Bank Myanmar Co., Ltd.	Deposits		383		27,278
	Other liabilities		7		26
PRASAC Microfinance Institution Plc.	Loans measured at amortized cost (gross amount)		419,793		182,271
	Allowances for credit losses		290		298
	Other assets		2,677		1,080
	Provisions		135		146
	Other liabilities		1,967		1,304
PT Bank KB Bukopin Tbk	Cash and due from financial institutions		242,944		—
	Financial assets at fair value through profit or loss		247,956		—
	Loans measured at amortized cost (gross amount)		1,112,350		592,750
	Provisions		860		—
	Other assets		12,073		81
	Deposits		6,158		3,938
	Other liabilities		2,695		—
Orient Kwang-yang Co., Ltd.	Financial assets at fair value through profit or loss		7		—
	Deposits		4,040		—
	Other liabilities		53		—

178

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
Trust	Other assets		14,024		29,829
	Other liabilities		519,934		169,910
KB Wise Star Private Real Estate Feeder Fund No.1	Other assets		5		6
Securitization SPE	Deposits		1,014		1,035
Structured entities	Derivative assets		—		1,461
	Loans measured at amortized cost (gross amount)		676,866		69,323
	Allowances for credit losses		1,366		248
	Other assets		345		128
	Derivative liabilities		31,627		11,724
	Deposits		3,735		2,033
	Provisions		316		122
	Other liabilities		3,806		3,311
KB Haeorum Private Securities Fund No.83 (Bond) *	Other assets		—		1
NH-Amundi Global Private Securities Investment Trust No.1 (USD) (Bond)	Other assets		1		1
KB Core Blind Private Real Estate Fund No.1	Loans measured at amortized cost (gross amount)		10,000		10,000
	Other assets		20		20
KB Global Private Real Estate Debt Fund No.10	Other assets		1		1
Samsung Credit Value Plus Professional Investment Type Private Securities Fund (Bond) *	Other liabilities		—		478
KB Emerging Markets Dept Private Securities Fund(USD)(Bond) *	Other assets		—		1
Samsung SRA Private Real Estate Investment Trust No.28D	Deposits		62		37
	Other liabilities		122		—
KIM Basic Private Securities Fund No.102 (Bond) *	Other assets		—		2
	Other liabilities		—		101
NH-Amundi Private Securities Investment Trust S5(USD)(BOND) *	Other assets		—		1
Vestas Investors Private Real Estate Fund Investment Trust No.69-3	Other assets		1		—
IDMB UNITED PTE.LTD.	Deposits		241		—
	Provisions		985		—
	Other liabilities		1,547		—

179

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent’s subsidiaries
KB Securities Co., Ltd.	Derivative assets		134,303		43,797
	Loans measured at amortized cost (gross amount)		141,922		124,527
	Allowances for credit losses		358		201
	Other assets		6,186		5,564
	Derivative liabilities		33,258		33,338
	Deposits		863,597		532,759
	Provisions		36		90
	Other liabilities		27,511		26,822
KB Asset Management Co., Ltd.	Other assets		413		422
	Deposits		25,950		13,206
	Other liabilities		16		8
KB Real Estate Trust Co., Ltd.	Other assets		2		3
	Deposits		48,600		103,329
	Other liabilities		358		353
KB Investment Co., Ltd.	Deposits		81,064		100,338
	Other liabilities		707		42
KB Credit Information Co., Ltd.	Deposits		13,430		4,536
	Other liabilities		5,475		5,656
KB Data System Co., Ltd.	Other assets		317		215
	Deposits		19,254		15,416
	Other liabilities		7,362		6,059
KB Life Insurance Co., Ltd.	Derivative assets		773		5,387
	Other assets		1,502		1,519
	Derivative liabilities		2,060		168
	Deposits		788		2,608
	Provisions		224		—
	Other liabilities		1,118		1,346
KB Kookmin Card Co., Ltd.	Derivative assets		—		55
	Loans measured at amortized cost (gross amount)		177,422		71,130
	Allowances for credit losses		207		86
	Other assets		22,600		22,043
	Derivative liabilities		884		—
	Deposits		108,935		71,087
	Provisions		423		724
	Other liabilities		55,121		47,433
KB Savings Bank Co., Ltd.	Other liabilities		606		323
KB Capital Co., Ltd.	Loans measured at amortized cost (gross amount)		35,484		71,130
	Allowances for credit losses		52		156
	Other assets		528		365
	Deposits		708,515		219,311
	Provisions		182		45
	Other liabilities		3,067		3,006

180

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB Insurance Co., Ltd.	Derivative assets		137,320		37,098
	Loans measured at amortized cost (gross amount)		18,390		17,958
	Allowances for credit losses		5		3
	Other assets		12,574		15,682
	Derivative liabilities		29,632		3,670
	Deposits		62,199		4,519
	Debentures		—		29,998
	Provisions		7		18
	Other liabilities		13,241		12,820
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Derivative assets		13,582		6,968
	Other assets		3,880		3,815
	Derivative liabilities		642		652
	Deposits		7,779		7,634
	Debentures		30,000		30,000
	Other liabilities		43,878		38,100
KB STAR REIT Co., Ltd.	Other assets		21		—
	Derivative liabilities		8,089		—
	Deposits		35,053		—
	Other liabilities		1		—
KB Hanbando BTL Private Special Asset Fund No.1	Other assets		26		29
KB AMP Infra Private Special Asset Fund No.1(FoFs)	Other assets		1		1
KB AMP Infra Private Special Asset Fund No.13(FoFs)	Other assets		2		1
KB Muni bond Private Securities Fund No.1 (USD)	Other assets		2		2
KB Global Private Real Estate Debt Fund No.1	Other assets		3		3
KB Global Private Real Estate Debt Fund No.11	Other assets		1		—
KB Global Private Real Estate Debt Fund No.15	Other assets		2		2
KB Global Private Real Estate Debt Fund No.17	Other assets		1		—
KB NA COMPASS Energy Private Special Asset Fund *	Other assets		—		1
KB Star Office Private Real Estate Master Fund No.3	Deposits		—		171
	Other liabilities		—		9
KB Star Office Private Real Estate Feeder Fund No.4	Loans measured at amortized cost (gross amount)		20,000		20,000
	Allowances for credit losses		4		3
	Other assets		13		11
	Deposits		215		532
	Other liabilities		4		1

181

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB Global Core Bond Securities Feeder Fund(Bond)	Derivative assets		—		7
	Other assets		2		4
	Derivative liabilities		—		6
KB New Renewable Energy Private Special Asset Fund No.1	Other assets		2		2
KB North America Private Real Estate Debt Fund No.1	Derivative assets		—		1,378
	Other assets		1		1
	Derivative liabilities		51		—
KB North America Private Real Estate Debt Fund No.3	Derivative assets		2,411		1,221
	Other assets		3		2
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)	Other assets		1		1
KB Global Infrastructure Synergy Private Special Asset Fund	Other assets		1		1
KB BMO Senior Loan Private Special Asset Fund No.1(FOF)	Derivative assets		—		3,275
	Other assets		3		2
	Derivative liabilities		2,001		—
KB BMO Senior Loan Private Special Asset Fund No.2(USD)	Other assets		2		2
KB BMO Senior Loan Private Special Asset Fund No.4(USD)	Other assets		2		—
KB BMO Senior Loan Private Special Asset Fund No.5(FOF)	Other assets		3		—
KB New Renewable Green New Deal Private Special Asset No.2	Other assets		2		1
KB Sinansan Line Private Special Asset Fund(SOC)	Other assets		7		4
KB Korea Short Term Premium Private Securities No.19(USD)(Bond) *	Other assets		—		2
KB Korea Short Term Premium Private Securities No.21(USD)(Bond) *	Other assets		—		2
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *	Other assets		—		1
	Derivative liabilities		—		1,306
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *	Derivative assets		—		96
	Other assets		—		2
KB Korea Short Term Premium Private Securities Fund No.25(USD)(Bond)	Other assets		5		—
	Derivative liabilities		2,891		—
KB Korea Short Term Premium Private Securities Fund No.26(USD)(Bond)	Other assets		3		—
	Derivative liabilities		1,839		—
KB Korea Short Term Premium Private Securities Fund No.27(USD)(Bond)	Other assets		5		—
	Derivative liabilities		3,502		—
KB Korea Short Term Premium Private Securities Fund No.32(USD)(Bond)	Derivative assets		5,377		—
	Other assets		5		—

182

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB Korea Short Term Premium Private Securities Fund No.33(USD)(Bond)	Derivative assets		1,557		—
KB Multi Alpha Plus Private Fund No.1	Other assets		2		2
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)	Other assets		6		7
KB New Deal Innovation Fund	Other assets		1		—
KB Korea Infrastructure Credit Guarantee Private Special Asset No.1	Other assets		3		2
Hanwha Europe Credit Private Fund No.16	Derivative assets		—		9
(FOF)	Derivative liabilities		744		119
KB Logistics Blind Private Real Estate Fund No.1	Loans measured at amortized cost (gross amount)		52,500		—
	Allowances for credit losses		2		—
	Other assets		374		2
KB Aircraft Private Special Asset Fund No.1	Other assets		2		2
	Derivative liabilities		5,096		3,835
KB Star ESG Prime Mid-Short Bond Securities Feeder Fund(Bond)	Other assets		1		1
KB GK Project Private Special Asset Fund No.3	Other assets		5		—
KB ASF Infra Private Special Asset Fund(FoFs)	Other assets		1		—
	Derivative liabilities		479		—
KB Duke Private Special Asset Fund	Other assets		1		—
KB Star Reits Private Real Estate Feeder Fund No.1	Other assets		2		—
KB Star Reits Private Real Estate Feeder Fund No.2	Other assets		4		—
HSBC Senior UK Direct Lending Fund 2020 RAIF SICAV-S.A.	Other assets		1		—
NB Private Debt Fund IV LUX (B) SCSP	Other assets		1		—
Associates
Korea Credit Bureau Co., Ltd.	Deposits		27,889		10,200
Incheon Bridge Co., Ltd.	Financial assets at fair value through profit or loss		32,948		37,382
	Loans measured at amortized cost (gross amount)		95,200		114,100
	Allowances for credit losses		8		25
	Other assets		615		423
	Deposits		48,639		35,487
	Provisions		7		18
	Other liabilities		446		99
Jungdo Co., Ltd.	Deposits		4		4
Dae-A Leisure Co., Ltd.	Deposits		154		17
Iwon Alloy Co., Ltd.	Deposits		1		—
Computerlife Co., Ltd.	Deposits		3		—

183

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
Skydigital Inc.	Deposits		10		85
Jo Yang Industrial Co., Ltd.	Deposits		—		1
TMAPMOBILITY CO.,LTD.	Deposits		30,000		—
	Other liabilities		76		—
KB High-Tech Company Investment Fund	Deposits		688		1,504
Aju Good Technology Venture Fund	Deposits		7,222		6,286
	Other liabilities		73		10
KB-KDBC Pre-IPO New Technology Business Investment Fund	Deposits		317		904
KB Digital Innovation & Growth New Technology Business Investment Fund	Deposits		674		2,088
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Deposits		1,526		1,524
	Other liabilities		1		—
KB Global Platform Fund	Deposits		19,655		26,823
	Other liabilities		12		5
WJ Private Equity Fund No.1	Other assets		2		2
	Deposits		221		260
KB Bio Global Expansion Private Equity Fund No.1	Deposits		1,400		—
	Other liabilities		9		—
KB Digital Platform Fund	Deposits		15,000		—
	Other liabilities		2		—
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 *	Deposits		—		2,578
Star-Lord General Investors Private Real Estate Investment Company No.10	Loans measured at amortized cost (gross amount)		149,294		—
	Allowances for credit losses		1		—
	Other assets		3,208		—
Associates of Parent’s subsidiaries
SY Auto Capital Co., Ltd.	Deposits		10		17
RAND Bio Science Co., Ltd.	Deposits		3		443
Food Factory Co., Ltd.	Loans measured at amortized cost (gross amount)		3,337		3,545
	Allowances for credit losses		4		4
	Other assets		4		2
	Deposits		664		839
	Other liabilities		1		6
Acts Co., Ltd. *	Deposits		—		154
Paycoms Co., Ltd.	Deposits		1		1
Big Dipper Co., Ltd.	Deposits		19		—
Spark Biopharma Inc.	Deposits		17,534		6,015
	Other liabilities		91		3
Wyatt Corp.	Deposits		1		1
UPRISE, Inc.	Deposits		27		4,001
CellinCells Co., Ltd.	Deposits		37		38

184

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
Channel Corporation	Deposits		3,000		—
	Other liabilities		21		—
COSES GT Co., Ltd.	Loans measured at amortized cost (gross amount)		500		500
	Allowances for credit losses		4		2
	Other assets		2		1
	Deposits		1,213		1,939
KB No.17 Special Purpose Acquisition Company *	Deposits		—		1,687
	Other liabilities		—		12
KB No. 18 Special Purpose Acquisition Company *	Deposits		—		2,077
	Other liabilities		—		12
KB No. 19 Special Purpose Acquisition Company *	Deposits		—		1,013
	Other liabilities		—		5
KB No.20 Special Purpose Acquisition Company *	Deposits		—		1,681
	Other liabilities		—		3
KB No.21 Special Purpose Acquisition Company	Deposits		2,263		—
	Other liabilities		29		—
KB No.22 Special Purpose Acquisition Company	Deposits		1,948		—
KB No.23 Special Purpose Acquisition Company	Deposits		2,205		—
	Other liabilities		22		—
KB No.24 Special Purpose Acquisition Company	Deposits		9,983		—
	Other liabilities		1		—
SwatchOn Inc. *	Deposits		—		686
Gomi corporation Inc.	Loans measured at amortized cost (gross amount)		2,200		2,200
	Allowances for credit losses		15		12
	Other assets		5		4
	Deposits		915		3,188
	Other liabilities		1		1
S&E bio Co., Ltd.	Deposits		6,419		263
	Other liabilities		1		—
4N Inc.	Deposits		5		39
Contents First Inc.	Loans measured at amortized cost (gross amount)		10,017		—
	Allowances for credit losses		1		—
	Other assets		2		—
	Deposits		5,010		12,650
	Other liabilities		21		57
December & Company Inc.	Deposits		1		1
GENINUS Inc. *	Deposits		—		34,415
	Other liabilities		—		2
Mantisco Co., Ltd.	Deposits		623		386
Pin Therapeutics Inc.	Deposits		6,033		—
	Other liabilities		18		—

185

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
G1 Playground Co., Ltd.	Deposits		—		354
SuperNGine Co., Ltd.	Deposits		17		944
Desilo Inc.	Loans measured at amortized cost (gross amount)		300		301
	Allowances for credit losses		2		2
	Deposits		1		168
Turing Co., Ltd.	Deposits		2,788		1,054
IGGYMOB Co., Ltd.	Deposits		254		2,938
ZIPDOC Inc.	Deposits		915		—
TeamSparta Inc.	Deposits		12,502		—
	Other liabilities		6		—
Chabot Mobility Co., Ltd.	Deposits		86		—
Wemade Connect Co., Ltd.	Deposits		10,370		—
	Other liabilities		28		—
Nextrade Co., Ltd.	Deposits		56,202		—
	Other liabilities		263		—
KB Pre IPO Secondary Venture Fund No.1 *	Deposits		—		103
Key management personnel	Loans measured at amortized cost (gross amount)		4,391		3,252
	Allowances for credit losses		2		2
	Other assets		6		3
	Deposits		9,752		9,909
	Provisions		1		1
	Other liabilities		60		27
Others
Retirement pension	Other assets		778		369
	Other liabilities		10,141		5,014

* Excluded from the Bank’s related party as of December 31, 2022.

40.3 Details of right-of-use assets and lease liabilities with related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent’s subsidiaries
KB Securities Co., Ltd.	Right-of-use assets		21,927		26,565
	Lease liabilities		26,825		31,814
KB Kookmin Card Co., Ltd.	Right-of-use assets		108		200
	Lease liabilities		29		53
KB Insurance Co., Ltd.	Right-of-use assets		—		3,797
	Lease liabilities		—		3,963
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Right-of-use assets		6,971		9,168
	Lease liabilities		7,021		9,042
Associate of Parent
Star-Lord General Investors Private Real Estate Investment Company No.10	Right-of-use assets		3,563		—
	Lease liabilities		3,707		—

186

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.4 Notional amount of derivative assets and liabilities arising from transactions with related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Subsidiaries
LOG the 3rd L.L.C.	Notional amount of derivative financial instruments		24,300		24,300
KBL Incheon 1st L.L.C.	Notional amount of derivative financial instruments		100,000		100,000
KB DTower 1st L.L.C.	Notional amount of derivative financial instruments		50,000		50,000
KB INO 2nd L.L.C. *	Notional amount of derivative financial instruments		—		30,000
KB Happy 1st L.L.C. *	Notional amount of derivative financial instruments		—		50,000
KB Socio the 1st L.L.C. *	Notional amount of derivative financial instruments		—		30,000
KB Industry the 1st L.L.C. *	Notional amount of derivative financial instruments		—		10,000
KBST the 1st L.L.C. *	Notional amount of derivative financial instruments		—		30,000
KBH the 4th L.L.C.	Notional amount of derivative financial instruments		12,000		18,000
Great Forest the 1st L.L.C.	Notional amount of derivative financial instruments		8,500		14,500
KBC the 3rd L.L.C. *	Notional amount of derivative financial instruments		—		35,000
KBH the 6th L.L.C.	Notional amount of derivative financial instruments		50,000		50,000
Beomuh Landmark the 2nd L.L.C.	Notional amount of derivative financial instruments		30,000		56,000
KB Industry 2nd L.L.C. *	Notional amount of derivative financial instruments		—		10,000
KB Handok the 1st L.L.C. *	Notional amount of derivative financial instruments		—		30,000
KB Heracles the 1st L.L.C. *	Notional amount of derivative financial instruments		—		25,000
K Plus the 1st L.L.C.	Notional amount of derivative financial instruments		200,000		200,000
KB Livv H 1st L.L.C.	Notional amount of derivative financial instruments		30,000		30,000
Livv H 1st L.L.C.	Notional amount of derivative financial instruments		50,000		50,000
KB Eagles 1st Co., Ltd.	Notional amount of derivative financial instruments		30,000		30,000
KB Manchon Harrington Co., Ltd.	Notional amount of derivative financial instruments		12,800		14,900
KB Livv l 1st Co., Ltd.	Notional amount of derivative financial instruments		50,000		50,000

187

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.4 Notional amount of derivative assets and liabilities arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB Cheongla Hill Co., Ltd.	Notional amount of derivative financial instruments		60,000		60,000
KB Dong-in Central L.L.C.	Notional amount of derivative financial instruments		20,000		20,000
KB Eagles 2nd Co., Ltd.	Notional amount of derivative financial instruments		50,000		50,000
KBH Steal Co., Ltd.	Notional amount of derivative financial instruments		150,000		150,000
KB Great Bear 1st L.L.C.	Notional amount of derivative financial instruments		90,000		90,000
Ryan Mobility 1st L.L.C.	Notional amount of derivative financial instruments		50,000		50,000
KB Chemical 1st Co., Ltd.	Notional amount of derivative financial instruments		50,000		50,000
KB Eugene 1st Co., Ltd. *	Notional amount of derivative financial instruments		—		10,000
KB Harim 1st L.L.C.	Notional amount of derivative financial instruments		30,000		30,000
KB Eagles 3rd Co., Ltd.	Notional amount of derivative financial instruments		50,000		50,000
LEP 2nd Co., Ltd.	Notional amount of derivative financial instruments		70,000		70,000
KB Buamsamjung 1st Co., Ltd.	Notional amount of derivative financial instruments		35,600		50,000
Liiv H 2nd Co., Ltd.	Notional amount of derivative financial instruments		30,000		30,000
Parent’s subsidiaries
KB Securities Co., Ltd.	Notional amount of derivative financial instruments		2,820,272		2,360,006
KB Life Insurance Co., Ltd.	Notional amount of derivative financial instruments		57,629		163,227
KB Kookmin Card Co., Ltd.	Notional amount of derivative financial instruments		126,730		30,000
KB Insurance Co., Ltd.	Notional amount of derivative financial instruments		2,192,657		1,356,044
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Notional amount of derivative financial instruments		258,928		407,653
KB STAR REIT Co., Ltd.	Notional amount of derivative financial instruments		420,280		—
KB Global Core Bond Securities Feeder Fund(Bond)	Notional amount of derivative financial instruments		—		25,796
KB North America Private Real Estate Debt Fund No.1	Notional amount of derivative financial instruments		31,683		29,638
KB North America Private Real Estate Debt Fund No.3	Notional amount of derivative financial instruments		104,552		293,411

188

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.4 Notional amount of derivative assets and liabilities arising from transactions with related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB BMO Senior Loan Private Special Asset Fund No.1(FOF)	Notional amount of derivative financial instruments		38,112		60,822
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *	Notional amount of derivative financial instruments		—		23,941
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *	Notional amount of derivative financial instruments		—		82,985
KB Korea Short Term Premium Private Securities Fund No.25(USD)(Bond)	Notional amount of derivative financial instruments		51,554		—
KB Korea Short Term Premium Private Securities Fund No.26(USD)(Bond)	Notional amount of derivative financial instruments		38,653		—
KB Korea Short Term Premium Private Securities Fund No.27(USD)(Bond)	Notional amount of derivative financial instruments		64,632		—
KB Korea Short Term Premium Private Securities Fund No.32(USD)(Bond)	Notional amount of derivative financial instruments		103,538		—
KB Korea Short Term Premium Private Securities Fund No.33(USD)(Bond)	Notional amount of derivative financial instruments		54,494		—
Hanwha Europe Credit Private Fund No.16 (FOF)	Notional amount of derivative financial instruments		35,081		15,254
KB Aircraft Private Special Asset Fund No.1	Notional amount of derivative financial instruments		123,949		136,328
KB ASF Infra Private Special Asset Fund(FoFs)	Notional amount of derivative financial instruments		6,011		—

* Excluded from the Bank’s related party as of December 31, 2022.

189

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.5 Details of significant lending transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022 1
	Beginning		Loan		Collection		Others			Ending
Subsidiaries
Kookmin Bank Cambodia Plc.		343,795		275,526		208,402		19,963			430,882
Kookmin Bank (China) Ltd.		1,293,871		791,092		1,476,898		120,633			728,698
PRASAC Microfinance Institution Plc.		182,271		529,730		278,720		(13,488	)		419,793
PT Bank KB Bukopin Tbk		592,750		8,462,217		7,749,339		54,678			1,360,306
Structured entities 2		69,323		1,772,167		1,164,208		(416	)		676,866
IDMB UNITED PTE.LTD.		—		3,874		3,874		—			—
KB Core Blind Private Real Estate Fund No.1		10,000		—		—		—			10,000
Parent’s subsidiaries
KB Securities Co., Ltd.		124,527		1,035,932		1,003,576		(14,961	)		141,922
KB Insurance Co., Ltd.		17,958		475		3		(40	)		18,390
KB Kookmin Card Co., Ltd.		71,130		250,451		147,431		3,272			177,422
KB Capital Co., Ltd.		71,130		—		41,709		6,063			35,484
KB Star Office Private Real Estate Feeder Fund No.4		20,000		—		—		—			20,000
KB Logistics Blind Private Real Estate Fund No.1		—		52,500		—		—			52,500
Associates
Incheon Bridge Co., Ltd.		151,482		—		18,900		(4,434	)		128,148
Associate of Parent
Star-Lord General Investors Private Real Estate Investment Company No.10		—		150,000		—		(706	)		149,294
Associates of Parent’s subsidiaries
Food Factory Co., Ltd.		3,545		1,500		1,707		(1	)		3,337
COSES GT Co., Ltd.		500		—		—		—			500
Gomi corporation Inc.		2,200		—		—		—			2,200
Desilo Inc.		301		—		—		(1	)		300
Contents First Inc.		—		10,000		—		17			10,017
Key management personnel 4		3,252		1,041		2,038		2,136			4,391

190

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.5 Details of significant lending transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2021 1
	Beginning		Loan		Collection		Others			Ending
Subsidiaries
Kookmin Bank Cambodia Plc.		195,840		265,663		138,763		21,055			343,795
Kookmin Bank (China) Ltd.		1,153,280		1,181,944		1,147,335		105,982			1,293,871
PRASAC Microfinance Institution Plc.		136,000		47,420		—		(1,149	)		182,271
PT Bank KB Bukopin Tbk		652,800		8,153,850		8,276,953		63,053			592,750
Structured entities 3		3,929		113,629		48,101		(134	)		69,323
KB Core Blind Private Real Estate Fund No.1		10,000		—		—		—			10,000
Parent’s subsidiaries
KB Securities Co., Ltd.		97,803		829,086		807,840		5,478			124,527
KB Insurance Co., Ltd.		—		18,200		300		58			17,958
KB Kookmin Card Co., Ltd.		36,992		86,033		38,613		(13,282	)		71,130
KB Capital Co., Ltd.		54,400		11,441		—		5,289			71,130
KB Star Office Private Real Estate Feeder Fund No.4		20,000		—		—		—			20,000
Associates
Incheon Bridge Co., Ltd.		171,756		—		18,900		(1,374	)		151,482
Associates of Parent’s subsidiaries
Food Factory Co., Ltd.		3,193		388		37		1			3,545
UPRISE, Inc.		500		—		500		—			—
COSES GT Co., Ltd.		500		—		—		—			500
Gomi corporation Inc.		—		2,200		—		—			2,200
Desilo Inc.		—		300		—		1			301
Key management personnel 4		4,599		2,432		1,752		(2,027	)		3,252

¹ Transactions between related parties, such as settlements arising from operating activities and daylight overdraft to be repaid on the day of handling, are excluded.

²  Includes details of KB Happy 1st L.L.C. and 13 others that are excluded from related parties for the year ended December 31, 2022.

³  Includes details of KB Display 1st L.L.C. and 10 others that are excluded from related parties for the year ended December 31, 2021.

⁴  Includes loan transactions that occurred before they became related parties.

191

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		2022
		Beginning		Borrowing		Repayment		Others 1			Ending
Parent
KB Financial Group Inc.	Deposits		518,076		950,000		950,000		(287,020	)		231,056
Subsidiaries
Kookmin Bank Cambodia Plc.	Deposits		16,042		—		—		(13,678	)		2,364
Kookmin Bank (China) Ltd.	Deposits		3,374		—		—		(1,414	)		1,960
	Borrowings		225,870		—		—		41,294			267,164
KB Bank Myanmar Co., Ltd.	Deposits		27,278		—		—		(26,895	)		383
PT Bank KB Bukopin Tbk	Deposits		3,938		—		—		2,220			6,158
Securitization SPE	Deposits		1,035		—		—		(21	)		1,014
Structured entities	Deposits		2,033		—		—		1,702			3,735
Samsung SRA Private Real Estate Investment Trust No.28D	Deposits		37		—		—		25			62
Orient Kwang-yang Co., Ltd.	Deposits		—		3,621		3,571		3,990			4,040
IDMB UNITED PTE.LTD.	Deposits		—		—		—		241			241
Parent’s subsidiaries
KB Securities Co., Ltd.	Deposits		532,759		109,580		75,000		296,258			863,597
KB Asset Management Co., Ltd.	Deposits		13,206		—		—		12,744			25,950
KB Real Estate Trust Co., Ltd.	Deposits		103,329		—		—		(54,729	)		48,600
KB Investment Co., Ltd.	Deposits		100,338		195,000		203,000		(11,274	)		81,064
KB Credit Information Co., Ltd.	Deposits		4,536		5,599		1,425		4,720			13,430
KB Data System Co., Ltd.	Deposits		15,416		9,500		10,500		4,838			19,254
KB Life Insurance Co., Ltd.	Deposits		2,608		—		—		(1,820	)		788
KB Kookmin Card Co., Ltd.	Deposits		71,087		22,000		22,000		37,848			108,935
KB Capital Co., Ltd.	Deposits		219,311		—		—		489,204			708,515
KB Insurance Co., Ltd.	Deposits		4,519		—		—		57,680			62,199
	Debentures		29,998		—		30,000		2			—
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Deposits		7,634		—		—		145			7,779
	Debentures		30,000		—		—		—			30,000
KB Star Office Private Real Estate Master Fund No.3	Deposits		171		—		171		—			—
KB Star Office Private Real Estate Feeder Fund No.4	Deposits		532		—		318		1			215
KB STAR REIT Co., Ltd.	Deposits		—		—		—		35,053			35,053

192

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022
		Beginning		Borrowing		Repayment		Others 1			Ending
Associates
Korea Credit Bureau Co., Ltd.	Deposits		10,200		—		—		17,689			27,889
Incheon Bridge Co., Ltd.	Deposits		35,487		29,217		15,000		(1,065	)		48,639
Jungdo Co., Ltd.	Deposits		4		—		—		—			4
Dae-A Leisure Co., Ltd.	Deposits		17		—		—		137			154
Iwon Alloy Co., Ltd.	Deposits		—		—		—		1			1
Computerlife Co., Ltd.	Deposits		—		—		—		3			3
Skydigital Inc.	Deposits		85		—		—		(75	)		10
Jo Yang Industrial Co., Ltd.	Deposits		1		—		—		(1	)		—
KB High-Tech Company Investment Fund	Deposits		1,504		—		—		(816	)		688
Aju Good Technology Venture Fund	Deposits		6,286		6,577		3,840		(1,801	)		7,222
KB-KDBC Pre-IPO New Technology Business Investment Fund	Deposits		904		—		—		(587	)		317
KB Digital Innovation & Growth New Technology Business Investment Fund	Deposits		2,088		—		—		(1,414	)		674
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Deposits		1,524		—		—		2			1,526
KB Global Platform Fund	Deposits		26,823		—		—		(7,168	)		19,655
WJ Private Equity Fund No.1	Deposits		260		—		—		(39	)		221
TMAPMOBILITY CO.,LTD.	Deposits		—		80,000		50,000		—			30,000
KB Bio Global Expansion Private Equity Fund No.1	Deposits		—		1,400		—		—			1,400
KB Digital Platform Fund	Deposits		—		59,000		44,000		—			15,000
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 2	Deposits		2,578		—		2,578		—			—
Associates of Parent’s subsidiaries
SY Auto Capital Co., Ltd.	Deposits		17		—		—		(7	)		10
RAND Bio Science Co., Ltd.	Deposits		443		—		—		(440	)		3
Food Factory Co., Ltd.	Deposits		839		511		1,018		332			664
Acts Co., Ltd. 2	Deposits		154		—		—		(154	)		—
Paycoms Co., Ltd.	Deposits		1		—		—		—			1
Big Dipper Co., Ltd.	Deposits		—		300		300		19			19
Spark Biopharma Inc.	Deposits		6,015		41,165		27,539		(2,107	)		17,534

193

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2022
		Beginning		Borrowing		Repayment		Others 1			Ending
Wyatt Corp.	Deposits		1		—		—		—			1
UPRISE, Inc.	Deposits		4,001		—		—		(3,974	)		27
CellinCells Co., Ltd.	Deposits		38		—		—		(1	)		37
COSES GT Co., Ltd.	Deposits		1,939		—		—		(726	)		1,213
KB No.17 Special Purpose Acquisition Company 2	Deposits		1,687		—		1,546		(141	)		—
KB No.18 Special Purpose Acquisition Company 2	Deposits		2,077		—		2,016		(61	)		—
KB No.19 Special Purpose Acquisition Company 2	Deposits		1,013		—		1,000		(13	)		—
KB No.20 Special Purpose Acquisition Company 2	Deposits		1,681		—		1,534		(147	)		—
KB No.21 Special Purpose Acquisition Company	Deposits		—		2,000		—		263			2,263
KB No.22 Special Purpose Acquisition Company	Deposits		—		—		—		1,948			1,948
KB No.23 Special Purpose Acquisition Company	Deposits		—		2,133		—		72			2,205
SwatchOn Inc. 2	Deposits		686		—		—		(686	)		—
Gomi corporation Inc.	Deposits		3,188		—		—		(2,273	)		915
S&E bio Co., Ltd.	Deposits		263		50		—		6,106			6,419
4N Inc.	Deposits		39		—		—		(34	)		5
Contents First Inc.	Deposits		12,650		10,000		16,000		(1,640	)		5,010
December & Company Inc.	Deposits		1		—		—		—			1
GENINUS Inc. 2	Deposits		34,415		—		—		(34,415	)		—
Mantisco Co., Ltd.	Deposits		386		—		—		237			623
Pin Therapeutics Inc.	Deposits		—		21,000		16,200		1,233			6,033
G1 Playground Co., Ltd.	Deposits		354		—		—		(354	)		—
SuperNGine Co., Ltd.	Deposits		944		—		—		(927	)		17
Desilo Inc.	Deposits		168		—		—		(167	)		1
Turing Co., Ltd.	Deposits		1,054		—		—		1,734			2,788
IGGYMOB Co., Ltd.	Deposits		2,938		—		—		(2,684	)		254
KB Pre IPO Secondary Venture Fund No.1 2	Deposits		103		—		—		(103	)		—
ZIPDOC Inc.	Deposits		—		—		—		915			915
TeamSparta Inc.	Deposits		—		9,000		4,000		7,502			12,502
Chabot Mobility Co., Ltd.	Deposits		—		—		—		86			86
Wemade Connect Co., Ltd.	Deposits		—		11,010		3,267		2,627			10,370
Wise Asset Management Co., Ltd	Deposits		—		6		6		—			—
Channel Corporation	Deposits		—		6,000		3,000		—			3,000
KB No.24 Special Purpose Acquisition Company Co., Ltd.	Deposits		—		—		—		9,983			9,983
Nextrade Co., Ltd.	Deposits		—		56,200		—		2			56,202
Key management personnel 3	Deposits		9,909		14,214		12,345		(2,026	)		9,752

194

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2021
		Beginning		Borrowing		Repayment		Others 1			Ending
Parent
KB Financial Group Inc.	Deposits		23,084		200,000		200,000		494,992			518,076
Subsidiaries
Kookmin Bank Cambodia Plc.	Deposits		2,584		—		—		13,458			16,042
Kookmin Bank (China) Ltd.	Deposits		2,278		—		—		1,096			3,374
	Borrowings		70,557		—		—		155,313			225,870
KB Bank Myanmar Co., Ltd.	Deposits		—		—		—		27,278			27,278
PT Bank KB Bukopin Tbk	Deposits		—		—		—		3,938			3,938
Securitization SPE	Deposits		1,043		—		—		(8	)		1,035
Structured entities	Deposits		1,096		—		—		937			2,033
Samsung SRA Private Real Estate Investment Trust No.28D	Deposits		11		—		—		26			37
Parent’s subsidiaries
KB Securities Co., Ltd.	Deposits		464,584		75,000		157,117		150,292			532,759
KB Asset Management Co., Ltd.	Deposits		6,915		—		—		6,291			13,206
KB Real Estate Trust Co., Ltd.	Deposits		71,261		—		—		32,068			103,329
KB Investment Co., Ltd.	Deposits		93,970		236,000		234,000		4,368			100,338
KB Credit Information Co., Ltd.	Deposits		5,340		2,231		2,025		(1,010	)		4,536
KB Data System Co., Ltd.	Deposits		17,561		9,500		12,500		855			15,416
KB Life Insurance Co., Ltd.	Deposits		2,085		—		—		523			2,608
KB Kookmin Card Co., Ltd.	Deposits		91,586		22,000		25,500		(16,999	)		71,087
KB Capital Co., Ltd.	Deposits		190,331		—		—		28,980			219,311
KB Insurance Co., Ltd.	Deposits		3,365		—		—		1,154			4,519
	Debentures		29,994		—		—		4			29,998
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Deposits		303		—		—		7,331			7,634
	Debentures		30,000		—		—		—			30,000
KB Star Office Private Real Estate Master Fund No.3	Deposits		171		—		—		—			171
KB Star Office Private Real Estate Feeder Fund No.4	Deposits		532		—		—		—			532

195

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2021
		Beginning		Borrowing		Repayment		Others 1			Ending
Associates
Korea Credit Bureau Co., Ltd.	Deposits		19,982		—		1,000		(8,782	)		10,200
Incheon Bridge Co., Ltd.	Deposits		39,520		15,000		20,000		967			35,487
Jungdo Co., Ltd.	Deposits		4		—		—		—			4
Dae-A Leisure Co., Ltd.	Deposits		636		—		479		(140	)		17
Skydigital Inc.	Deposits		15		—		—		70			85
Jo Yang Industrial Co., Ltd.	Deposits		2		—		—		(1	)		1
KB High-Tech Company Investment Fund	Deposits		12,695		—		—		(11,191	)		1,504
Aju Good Technology Venture Fund	Deposits		3,093		3,840		1,442		795			6,286
KB-KDBC Pre-IPO New Technology Business Investment Fund	Deposits		923		—		—		(19	)		904
KB Digital Innovation & Growth New Technology Business Investment Fund	Deposits		1,801		—		—		287			2,088
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Deposits		8,097		—		—		(6,573	)		1,524
KB Global Platform Fund	Deposits		20,197		—		—		6,626			26,823
Neomio Corp. 2	Deposits		535		—		—		(535	)		—
WJ Private Equity Fund No.1	Deposits		349		—		—		(89	)		260
Associate of Parent
KB Star Office Private Real Estate Investment Trust No.1 2	Deposits		4,255		—		1,770		93			2,578
Associates of Parent’s subsidiaries
SY Auto Capital Co., Ltd.	Deposits		6		—		—		11			17
KB No.17 Special Purpose Acquisition Company 2	Deposits		1,711		1,546		1,525		(45	)		1,687
KB No.18 Special Purpose Acquisition Company 2	Deposits		2,101		2,016		2,063		23			2,077
KB No.19 Special Purpose Acquisition Company 2	Deposits		1,053		1,000		1,000		(40	)		1,013
KB No.20 Special Purpose Acquisition Company 2	Deposits		1,716		1,534		1,522		(47	)		1,681
RAND Bio Science Co., Ltd.	Deposits		693		—		400		150			443

196

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.6 Details of significant borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		2021
		Beginning		Borrowing		Repayment		Others 1			Ending
Food Factory Co., Ltd.	Deposits		1,555		507		500		(723	)		839
Acts Co., Ltd. 2	Deposits		18		—		—		136			154
Paycoms Co., Ltd.	Deposits		1		—		—		—			1
Big Dipper Co., Ltd.	Deposits		1		—		—		(1	)		—
Wyatt Corp.	Deposits		1		—		—		—			1
Stratio, Inc.	Deposits		13		—		—		(13	)		—
UPRISE, Inc.	Deposits		11		—		—		3,990			4,001
CellinCells Co., Ltd.	Deposits		260		—		—		(222	)		38
COSES GT Co., Ltd.	Deposits		292		—		—		1,647			1,939
SwatchOn Inc. 2	Deposits		3,947		200		3,501		40			686
Gomi corporation Inc.	Deposits		37		—		—		3,151			3,188
S&E bio Co., Ltd.	Deposits		1,142		—		—		(879	)		263
KB Pre IPO Secondary Venture Fund No.1 2	Deposits		629		—		—		(526	)		103
4N Inc.	Deposits		76		—		—		(37	)		39
Contents First Inc.	Deposits		1,823		20,000		11,000		1,827			12,650
December & Company Inc.	Deposits		1		—		—		—			1
GENINUS Inc. 2	Deposits		13,630		—		5,000		25,785			34,415
Mantisco Co., Ltd.	Deposits		—		—		—		386			386
Spark Biopharma Inc.	Deposits		—		1,000		3,000		8,015			6,015
G1 Playground Co., Ltd.	Deposits		—		—		—		354			354
SuperNGine Co., Ltd.	Deposits		—		—		—		944			944
Desilo Inc.	Deposits		—		—		—		168			168
Turing Co., Ltd.	Deposits		—		—		—		1,054			1,054
IGGYMOB Co., Ltd.	Deposits		—		—		—		2,938			2,938
Key management personnel 3	Deposits		9,058		9,974		9,568		445			9,909

¹ Transactions between related parties, such as settlements arising from operating activities and deposits, are expressed in net amount.

²  Excluded from the Bank’s related party as of December 31, 2022.

³ Includes borrowing transactions that occurred before they became related parties.

197

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Equity investment and others		Withdrawal and others
Subsidiaries
Orient Kwang-yang Co., Ltd.		7		—
KB Wise Star Private Real Estate Feeder Fund No.1		—		128,833
KB Haeorum Private Securities Fund No.83 (Bond) *		50,000		150,155
Kiwoom Frontier Private Securities Fund No.10 (Bond)		100,000		149,631
Woori SafePlus Private Securities Fund S-8		150,000		150,517
Meritz Private Real Estate Fund No.9-2		7,418		30,163
KB KBSTAR 3-Year Futures Inverse Securities ETF (Debt-Derivative)		747,309		663,862
KB Core Blind Private Real Estate Fund No.1		—		6,556
KB Global Private Real Estate Debt Fund No.3 (USD)		—		1,216
Samsung Credit Value Plus Professional Investment Type Private Securities Fund (Bond) *		50,000		99,163
KB Emerging Markets Dept Private Securities Fund(USD)(Bond) *		—		119,374
Samsung SRA Private Real Estate Investment Trust No.28D		—		927
KIM Basic Private Securities Fund No.102 (Bond) *		50,000		99,844
KB Global Private Real Estate Debt Fund No.10		—		3,503
KB KBSTAR Active Korea Short Term Bond Market(AA-) ETF *		—		100,803
KTB Global CREDebt No.52		15,019		9,758
Hyundai Invest KKR Europe Real Estate No.1-3		10,875		3,120
KBSTAR FKTB 5Y Duration Following ETF		381,392		329,693
NH-Amundi Private Securities Investment Trust S5(USD)(BOND) *		—		43,233
Vestas Investors Private Real Estate Fund Investment Trust No.69-3		25,986		2,215
Samsung KODEX 10Y F-LKTB INV ETF *		120,869		129,467
KB Leaders Private Securities Fund No.23(Bond-Derivatives) *		100,000		98,532
Shinhan Institutional Discretionary Private Security Investment Trust No.1 [Bond-Derivative] *		100,000		100,086
KBSTAR FKTB 5Y Duration Following ETF		233,042		162,951
SAMSUNG KODEX 10Y F-LKTB INVERSE ETF *		99,326		96,524
Hanwha ARIRANG 3 Year Korea Treasury Bond Futures ETF [Bond-Derivatives] *		71,188		69,285
SHINHAN ASP PCF II Private Investment Trust No.2 (USD)		21,407		728
Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-1		13,496		74
Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-2		12,391		761
KB KBSTAR KTB 10Y Futures ETF		21,989		—
KB KBSTAR KTB 10Y Futures Inverse ETF		46,075		8,514
VI ESG Private Securities Investment Trust No.1 (Bond)		150,000		—
Mirae Asset Tiger S&P500 Inverse Future ETF H *		61,442		28,957
SHINHAN Aim Private Real Estate Fund Investment Trust No.26-C (USD)		19,611		—
KB KBSTAR KTB 3Y Futures ETF		102,214		40,198
KB KBSTAR US Treasury Long Bond Futures Inverse ETF H *		22,854		22,810
KB KBSTAR Nov 2025 Term Credit ETF		50,000		—

198

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2022
	Equity investment and others		Withdrawal and others
Parent’s subsidiaries
KB Hanbando BTL Private Special Asset Fund No.1		—		19,510
KB Hope Sharing BTL Private Special Asset Fund		—		1,416
KB Intellectual Property Fund		—		180
KB Star Office Private Real Estate Feeder Fund No.4		—		2,412
KB Global Core Bond Securities Feeder Fund(Bond)		—		42,737
KB New Renewable Energy Private Special Asset Fund No.1		3,492		1,794
KB Mezzanine Private Securities Fund No.3		—		16,240
Koreit BN Private Equity Fund		—		2,440
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)		2,452		2,746
KB BMO Senior Loan Private Special Asset Fund No.2(USD)		—		2,092
KB Korea Short Term Premium Private Securities No.19(USD)(Bond) *		—		23,985
KB Korea Short Term Premium Private Securities No.21(USD)(Bond) *		—		36,102
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *		—		24,433
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *		—		85,433
KB Korea Short Term Premium Private Securities Fund No.25(USD)(Bond)		47,672		—
KB Korea Short Term Premium Private Securities Fund No.26(USD)(Bond)		35,910		—
KB Korea Short Term Premium Private Securities Fund No.27(USD)(Bond)		59,980		—
KB Korea Short Term Premium Private Securities Fund No.28(USD)(Bond) *		95,368		108,180
KB Sinansan Line Private Special Asset Fund(SOC)		31,808		2,490
KB New Renewable Green New Deal Private Special Asset No.2		22,350		1,447
KB Multi Alpha Plus Private Fund No.1		—		400
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)		20,703		1,959
KB New Deal Infra Private Special Asset Fund		10,199		77
KB Logistics Blind Private Real Estate Fund No.1		25,812		1,463
KB Star ESG Prime Mid-Short Bond Securities Feeder Fund(Bond)		50,000		48,800
KB GK Project Private Special Asset Fund No.3		—		89,410
KB BMO Senior Loan Private Special Asset Fund No.4(USD)		38,828		404
KB Core Blind Private Real Estate Fund No.2		5,107		—
KB Star Reits Private Real Estate Feeder Fund No.2		65,000		—
KB KBSTAR US Short-Term IG Corporate Bond ETF		20,000		—
KB Korea Short Term Premium Private Securities Fund No.32		107,312		—
KB KBSTAR Nov 2023 Term Credit ETF		180,581		—
KB Korea Short Term Premium Private Securities Fund No.33(USD)(Bond)		52,816		—
KB Korea Short Term Premium Private Securities Fund No.34(USD)(Bond)		63,420		—

199

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2022
	Equity investment and others		Withdrawal and others
Associates
Future Planning KB Start-up Creation Fund		—		1,700
KB High-Tech Company Investment Fund		—		1,300
Aju Good Technology Venture Fund		—		5,400
KB-KDBC Pre-IPO New Technology Business Investment Fund		—		2,600
KB-TS Technology Venture Private Equity Fund		—		2,430
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		—		6,400
KB SPROTT Renewable Private Equity Fund No.1		9,748		—
KB Global Platform Fund		8,000		6,150
KB Smart Scale Up Fund		12,000		—
KB-KTB Technology Venture Fund		6,000		—
KB Digital Platform Fund		14,000		—
KB-SOLIDUS Healthcare Investment Fund		6,000		—
KB New Deal Innovation Fund		9,600		—
TMAPMOBILITY CO.,LTD.		200,000		—
KB Prime Digital Platform Fund		2,600		—
KB Scale Up Fund II		4,500		—
Associate of Parent
Balhae Infrastructure Company		—		21,177
Associate of Parent’s subsidiaries
KB-Stonebridge Secondary Private Equity Fund		2,497		2,409
KB-NAU Special Situation Corporate Restructuring Private Equity Fund		440		2,044
KB Co-Investment Private Equity Fund No.1		6,320		—
KB-NP Green ESG New Technology Venture Capital Fund		2,805		—

200

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2021
	Equity investment and others		Withdrawal and others
Subsidiaries
PRASAC Microfinance Institution Plc.		381,896		—
PT Bank KB Bukopin Tbk		393,543		—
KB Wise Star Private Real Estate Feeder Fund No.1		—		5,160
KB Haeorum Private Securities Fund No.83 (Bond) *		150,000		463,699
Kiwoom Frontier Private Securities Fund No.10 (Bond)		100,000		414,899
Woori SafePlus Private Securities Fund S-8		100,000		254,328
Mirae Asset Triumph Global Privately Placed Feeder Investment Trust No.1 *		—		253,221
Meritz Private Real Estate Fund No.9-2		5,253		33,203
KB KBSTAR 3-Year Futures Inverse Securities ETF (Debt-Derivative)		1,529,185		1,522,136
KB Core Blind Private Real Estate Fund No.1		—		4,285
KB Global Private Real Estate Debt Fund No.3 (USD)		—		941
UBS Hana Professional Investor Private Investment Trust No.1 (Bond) *		—		101,958
Mirae Asset Triumph Privately Placed Investment Trust No.7 *		—		101,399
Samsung Credit Value Plus Professional Investment Type Private Securities Fund (Bond) *		—		153,251
Samsung KODEX 10Y F-LKTB INV ETF *		515,234		623,842
Samsung SRA Private Real Estate Investment Trust No.28D		—		906
KIM Basic Private Securities Fund No.102 (Bond) *		—		50,365
KB Korea Short Term Premium Private Securities No.16(USD)(Bond) *		—		35,470
KB Global Private Real Estate Debt Fund No.10		66,750		1,051
KB KBSTAR Active Korea Short Term Bond Market(AA-) ETF *		200,006		—
KTB Global CREDebt No.52		39,476		741
Hyundai Invest KKR Europe Real Estate No.1-3		24,161		—
KBSTAR FKTB 5Y Duration Following ETF		70,254		40,596
NH-Amundi Private Securities Investment Trust S5(USD)(BOND) *		35,151		—
Vestas Investors Private Real Estate Fund Investment Trust No.69-3		18,904		—
Parent’s subsidiaries
PT KB DATA SYSTEMS INDONESIA		145		—
KB Hanbando BTL Private Special Asset Fund No.1		—		20,448
KB Hope Sharing BTL Private Special Asset Fund		—		1,647
KB Intellectual Property Fund		—		476
KB Senior Loan Private Fund No.1 *		—		5,844
KB Star Office Private Real Estate Feeder Fund No.4		—		2,474
KB Global Core Bond Securities Feeder Fund(Bond)		—		22,134
KB New Renewable Energy Private Special Asset Fund No.1		—		1,793
KB Mezzanine Private Securities Fund No.3		22,235		42,562
Koreit BN Private Equity Fund		—		898
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)		1,896		—
KB BMO Senior Loan Private Special Asset Fund No.2(USD)		6,727		1,657

201

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.7 Details of significant investment and withdrawal transactions with related parties for the years ended December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)	2021
	Equity investment and others		Withdrawal and others
KB Korea Short Term Premium Private Securities No.15(USD)(Bond) *		—		23,660
KB Korea Short Term Premium Private Securities No.17(USD)(Bond) *		—		71,240
KB Korea Short Term Premium Private Securities No.19(USD)(Bond) *		22,088		—
KB Korea Short Term Premium Private Securities No.21(USD)(Bond) *		33,213		—
KB Korea Short Term Premium Private Securities No.22(USD)(Bond) *		22,556		—
KB Korea Short Term Premium Private Securities No.23(USD)(Bond) *		71,112		—
KB Sinansan Line Private Special Asset Fund(SOC)		29,156		2,757
KB New Renewable Green New Deal Private Special Asset No.2		12,349		124
KB Multi Alpha Plus Private Fund No.1		10,000		—
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)		33,147		—
KB New Deal Infra Private Special Asset Fund		408		—
KB Logistics Blind Private Real Estate Fund No.1		31,111		1
KB Star ESG Prime Mid-Short Bond Securities Feeder Fund(Bond)		49,000		—
KB Global Commerce Private Equity Investment Fund		7,000		—
Associates
Korea Credit Bureau Co., Ltd.		—		90
Balhae Infrastructure Company		279		9,584
KB GwS Private Securities Investment Trust *		—		147,785
KoFC POSCO Hanwha KB Shared Growth Private Equity Fund No.2 *		—		9,488
Future Planning KB Start-up Creation Fund		—		2,800
KB High-Tech Company Investment Fund		—		11,450
Aju Good Technology Venture Fund		—		4,769
KB-KDBC Pre-IPO New Technology Business Investment Fund		—		2,400
KB-TS Technology Venture Private Equity Fund		1,650		2,880
KB Digital Innovation & Growth New Technology Business Investment Fund		1,125		—
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		5,000		5,400
KB Global Platform Fund		13,500		—
KB-UTC Inno-Tech Venture Fund		3,390		750
KB Pre-IPO New Technology Business Investment Fund No.2		7,500		—
KB Smart Scale Up Fund		27,000		—
KB Bio Global Expansion Private Equity Fund No.1		10,000		—
KB-KTB Technology Venture Fund		3,000		—
KB Digital Platform Fund		12,600		—
KB-SOLIDUS Healthcare Investment Fund		600		—
KB New Deal Innovation Fund		4,000		—
Associate of Parent’s subsidiaries
KB-Stonebridge Secondary Private Equity Fund		7,576		9,039
KB-NAU Special Situation Corporate Restructuring Private Equity Fund		2,564		—

* Excluded from the Bank’s related party as of December 31, 2022.

202

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.8 Acceptances and guarantees and unused commitments provided to related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Subsidiaries
KB Microfinance Myanmar Co., Ltd.	Other commitments in foreign currency		15,208		14,226
PRASAC Microfinance Institution Plc.	Loan commitments in foreign currency		152,076		118,550
KB Wise Star Private Real Estate Feeder Fund No.1	Purchase of securities		—		817
Structured entities	Loan commitments in Korean won		11,696		19,827
	Purchase of securities		1,437,844		2,431,472
Meritz Private Real Estate Fund No.9-2	Purchase of securities		913		7,876
KB Core Blind Private Real Estate Fund No.1	Purchase of securities		—		175
KTB Global CREDebt No.52	Purchase of securities		12,564		19,542
Hyundai Invest KKR Europe Real Estate No.1-3	Purchase of securities		19,228		30,069
Vestas Investors Private Real Estate Fund Investment Trust No.69-3	Purchase of securities		35,139		56,882
SHINHAN ASP PCF II Private Investment Trust No.2 (USD)	Purchase of securities		4,540		—
IDMB UNITED PTE.LTD.	Loan commitments in foreign currency		25,346		—
	Other commitments in foreign currency		234,451		—
Vestas Europe Logistics General Private Real Estate Fund Investment Trust No.73-1	Purchase of securities		53,914		—
SHINHAN Aim Private Real Estate Fund Investment Trust No.26-C (USD)	Purchase of securities		63,650		—
Parent’s subsidiaries
KB Securities Co., Ltd.	Loan commitments in Korean won		140,000		140,000
KB Investment Co., Ltd.	Loss sharing agreements		1,000		1,000
KB Life Insurance Co., Ltd.	Loan commitments in Korean won		100,000		—
KB Kookmin Card Co., Ltd.	Loan commitments in Korean won		820,000		820,000
	Other commitments in Korean won		1,700,000		1,300,000
	Other commitments in foreign currency		44,515		—
KB Capital Co., Ltd.	Other commitments in foreign currency		40,381		13,041
KB Insurance Co., Ltd.	Loan commitments in Korean won		20,528		21,000
KB New Renewable Energy Private Special Asset Fund No.1	Purchase of securities		3,010		6,502
KB Mezzanine Private Securities Fund No.3	Purchase of securities		8,006		8,006

203

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.8 Acceptances and guarantees and unused commitments provided to related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
KB Europe Renewable Private Special Asset Fund No.2 (SOC-FoFs)	Purchase of securities		1,968		4,343
KB Global Infra Private Special Asset Fund No.5	Purchase of securities		24,999		24,999
KB Global Infra Private Special Asset Fund No.6	Purchase of securities		24,999		24,999
KB BMO Senior Loan Private Special Asset Fund No.2(USD)	Purchase of securities		29		27
KB New Renewable Green New Deal Private Special Asset No.2	Purchase of securities		5,301		27,651
KB Sinansan Line Private Special Asset Fund(SOC)	Purchase of securities		200,988		232,796
KB MCF Senior Loan Private Special Asset Fund No.3(FoFs)	Purchase of securities		3,554		14,287
KB New Deal Infra Private Special Asset Fund	Purchase of securities		7,492		17,692
KB Logistics Blind Private Real Estate Fund No.1	Purchase of securities		—		68,889
KB GK Project Private Special Asset Fund No.3	Purchase of securities		23		29
KB Core Blind Private Real Estate Fund No.2	Purchase of securities		94,893		—
Associates
Incheon Bridge Co., Ltd.	Loan commitments in Korean won		20,000		20,000
KB-TS Technology Venture Private Equity Fund	Purchase of securities		—		330
KB SPROTT Renewable Private Equity Fund No.1	Purchase of securities		5,140		14,887
KB Global Platform Fund	Purchase of securities		—		8,000
All Together Korea Fund No.2	Purchase of securities		990,000		—
KB Smart Scale Up Fund	Purchase of securities		7,000		19,000
KB Scale Up Fund II	Purchase of securities		25,500		—
KB-KTB Technology Venture Fund	Purchase of securities		6,000		12,000
KB Digital Platform Fund	Purchase of securities		113,400		127,400
KB-SOLIDUS Healthcare Investment Fund	Purchase of securities		23,400		29,400
KB New Deal Innovation Fund	Purchase of securities		6,400		16,000
KB Prime Digital Platform Fund	Purchase of securities		10,400		—
Associates of Parent Company
Balhae Infrastructure Company	Purchase of securities		6,154		6,154

204

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.8 Acceptances and guarantees and unused commitments provided to related parties as of December 31, 2022 and 2021, are as follows: (cont’d)

(In millions of Korean won)		December 31, 2022		December 31, 2021
Associates of Parent’s subsidiaries
KB-Stonebridge Secondary Private Equity Fund	Purchase of securities		691		3,188
KB-NAU Special Situation Corporate Restructuring Private Equity Fund	Purchase of securities		5,096		5,536
KB Co-Investment Private Equity Fund No.1	Purchase of securities		13,680		20,000
KB-Badgers Future Mobility ESG Fund No.1	Purchase of securities		19,050		—
KB-NP Green ESG New Technology Venture Capital Fund	Purchase of securities		12,195		—
Key management personnel	Loan commitments in Korean won		833		808

40.9 Acceptances and guarantees and unused commitments provided by related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)		December 31, 2022		December 31, 2021
Parent’s subsidiaries
KB Investment Co., Ltd.	Loss sharing agreements		7,008		7,561
KB Kookmin Card Co., Ltd.	Loan commitment in Korean won		82,354		88,283

40.10 Details of compensation to key management personnel for the years ended December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	2022
	Short-term employee benefits		Post- employment benefits		Share-based payments		Total
Registered directors (executive)		1,963		44		1,034		3,041
Registered directors (non-executive)		420		—		—		420
Non-registered directors		9,801		344		7,563		17,708
		12,184		388		8,597		21,169

(In millions of Korean won)	2021
	Short-term employee benefits		Post- employment benefits		Share-based payments		Total
Registered directors (executive)		1,898		84		2,670		4,652
Registered directors (non-executive)		395		—		—		395
Non-registered directors		7,042		405		7,131		14,578
		9,335		489		9,801		19,625

205

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

40.11 Major types of transactions between the Bank and the related parties include deposit taking transactions, loan transactions such as general purpose loans, corporate purchase loans, B2B loans, etc., settlements of funds arising from overseas remittance, providing credit line through the acceptance of letter of credit issued by the Bank, and overdraft accounts arising from net settlement agreement between the Bank and KB Kookmin Card Co., Ltd.

40.12 Details of collateral provided to related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)			December 31, 2022				December 31, 2021
	Assets pledged *		Carrying amount		Collateralized amount		Carrying amount		Collateralized amount
Parent’s subsidiaries
KB Securities Co., Ltd.		Securities		62,209		62,000		54,143		54,000
KB Life Insurance Co., Ltd.		Securities		25,425		25,000		25,813		25,000
KB Insurance Co., Ltd.		Securities		47,745		50,000		49,982		50,000

* Collaterals related to lease contracts arising from operating activities between related parties are excluded.

40.13 Details of collateral provided by related parties as of December 31, 2022 and 2021, are as follows:

(In millions of Korean won)	Assets held as collateral 1	December 31, 2022		December 31, 2021
Subsidiary
Taejon Samho The First Co., Ltd.	Beneficiary certificate of land development trust		—		130,000
KB Core Blind Private Real Estate Fund No.1	Real estate		12,000		12,000
Parent’s subsidiaries
KB Securities Co., Ltd.	Time deposits / Beneficiary right certificate		167,000		167,000
	Securities		129,196		25,135
	Real estate 2		—		12,000
KB Life Insurance Co., Ltd.	Securities		120,000		10,000
KB Kookmin Card Co., Ltd.	Time deposits		22,000		22,000
KB Insurance Co., Ltd.	Securities		250,000		90,000
	Real estate		24,570		24,570
KB Credit Information Co., Ltd.	Time deposits and others		2,228		2,054
KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.,)	Securities		18,159		20,008
KB Star Office Private Real Estate Feeder Fund No.4	Real estate		24,000		24,000
KB Logistics Blind Private Real Estate Fund No.1	Real estate		63,000		—
Key management personnel	Time deposits and others		457		745
	Real estate		5,165		3,818

¹  Collaterals related to lease contracts arising from operating activities between related parties are excluded.

²  Related to KB Wise Star Jongno Tower Real Estate Master Fund, a subsidiary of KB Securities Co., Ltd.

206

Kookmin Bank (A wholly owned subsidiary of KB Financial Group Inc.)

Notes to the Separate Financial Statements

December 31, 2022 and 2021

As of December 31, 2022, Incheon Bridge Co., Ltd., a related party, provides fund management account, civil engineering works insurance, and management and operations rights as senior collateral amounting to W 611,000 million to the project financing group consisting of the Bank and 5 other institutions, and as subordinated collateral amounting to W 384,800 million to subordinated debt holders consisting of the Bank and 2 other institutions. Also, it provides certificate of credit guarantee amounting to W 400,000 million as collateral to the project financing group consisting of the Bank and 5 other institutions.

40.14 The amounts of debt securities and others purchased through KB securities Co., Ltd. are W 7,341,904 million and W 9,642,170 million for the years ended December 31, 2022 and 2021, respectively, and the amounts of debt securities and others sold through KB securities Co., Ltd. are W 3,791,778 million and W 9,005,607 million for the years ended December 31, 2022 and 2021, respectively. In addition, KB Securities Co., Ltd. acquired W 50,000 million and W 185,000 million of debentures issued by the Bank through underwriting for the years ended December 31, 2022 and 2021, respectively.

40.15 The amounts of intangible assets and others purchased from KB Data System Co., Ltd. are W 42,947 million and W 24,420 million for the years ended December 31, 2022 and 2021, respectively.

40.16 The Bank has entered into CLS (Continuous Linked Settlement) service agreement with KB Securities Co., Ltd. and accordingly the Bank is able to provide intraday liquidity of USD 500 million on the condition of repayment on the day of payment.

40.17 The Bank and KB Kookmin Card Co., Ltd. are jointly and severally liable for the liabilities of the Bank before the spin-off date.

41. Approval of Issuance of the Financial Statements

The issuance of the Bank’s financial statements as of and for the year ended December 31, 2022, was approved by the board of directors on February 6, 2023.

207

Operating Status Report of

the Internal Control over Financial Reporting

To the Shareholder, Board of Directors and Audit Committee of Kookmin Bank

We, as the Chief Executive Officer (“CEO”) and the Internal Accounting Manager of Kookmin Bank(“the Bank”), assessed operating status of the Bank’s Internal Control over Financial Reporting(“ICFR”) for the year ended December 31, 2022.

The Bank’s management, including ourselves, is responsible for designing and operating ICFR.

We assessed whether the Bank effectively designed and operated its ICFR to prevent and detect errors or frauds which may cause a misstatement in financial statements to ensure preparation and disclosure of reliable financial information.

We used the ‘Conceptual Framework for Designing and Operating Internal Control over Financial Reporting’ established by the Operating Committee of Internal Control over Financial Reporting in Korea (the “ICFR Committee”) as the criteria for design and operation of the Bank’s ICFR. We also conducted an assessment of ICFR based on the ‘Management Guideline for Evaluating and Reporting Effectiveness of Internal Control over Financial Reporting’ established by the ICFR Committee.

Based on our assessment, we concluded that the Bank’s ICFR is designed and operated effectively as of December 31, 2022, in all material respects, in accordance with the ‘Conceptual Framework for Designing and Operating Internal Control over Financial Reporting’.

We certify that this report does not contain any untrue statement of a fact, or omit to state a fact necessary to be presented herein. We also certify that this report does not contain or present any statements which might cause material misunderstandings of the readers, and we have reviewed and verified this report with sufficient care.

February 24, 2023

Jae Keun Lee,

Chief Executive Officer

Jae Kwan Kim,

Internal Accounting Manager

208

Independent Auditors’

Review Report on Internal Control over Financial Reporting

Based on a report originally issued in Korean

To the President of

Kookmin Bank

We have reviewed the accompanying Operating Status Report of the Internal Control over Financial Reporting (“ICFR”) of Kookmin Bank (the “Bank”) as of December 31, 2022. The Company’s management is responsible for designing and maintaining effective ICFR and for its assessment of the effectiveness of ICFR. Our responsibility is to review management’s assessment and issue a report based on our review. In the accompanying report of management’s assessment of ICFR, the Bank’s management stated: “Based on our assessment, we concluded that the Company’s ICFR is designed and operated effectively as of December 31, 2022, in all material respects, in accordance with the Conceptual Framework for Designing and Operating Internal Control over Financial Reporting”

We conducted our review in accordance with ICFR Review Standards, issued by the Korean Institute of Certified Public Accountants. Those Standards require that we plan and perform the review to obtain assurance of a level less than that of an audit as to whether the Operating Status Report of the Internal Control over Financial Reporting is free of material misstatement. Our review consists principally of obtaining an understanding of the Bank’s ICFR, inquiries of company personnel about the details of the report, and tracing to related documents we considered necessary in the circumstances. We have not performed an audit and, accordingly, we do not express an audit opinion.

A Bank’s ICFR is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with Korean International Financial Reporting Standards. Because of its inherent limitations, however, ICFR may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Based on our review, nothing has come to our attention that the Operating Status Report of the Internal Control over Financial Reporting as of December 31, 2022 is not prepared in all material respects, in accordance with the Conceptual Framework for Designing and Operating Internal Control over Financial Reporting.

This report applies to the Bank’s ICFR in existence as of December 31, 2022. We did not review the Bank’s ICFR subsequent to December 31, 2022. This report has been prepared for Korean regulatory purposes, pursuant to the Act on External Audit of Stock Companies, Etc. and may not be appropriate for other purposes or for other users.

/s/ KPMG Samjong Accounting Corp.

Seoul, Korea

March 7, 2023

Notice to Readers

This report is annexed in relation to the audit of the financial statements as of December 31, 2022

209

Operating Status Report of

the Internal Control over Financial Reporting

To the Shareholder, Board of Directors and Audit Committee of Kookmin Bank

We, as the Chief Executive Officer (“CEO”) and the Internal Accounting Manager of Kookmin Bank (“the Bank”), assessed operating status of the Bank’s Internal Control over Financial Reporting(“ICFR”) for the year ended December 31, 2022.

The Bank’s management, including ourselves, is responsible for designing and operating ICFR.

We assessed whether the Bank effectively designed and operated its ICFR to prevent and detect errors or frauds which may cause a misstatement in financial statements to ensure preparation and disclosure of reliable financial information.

We used the ‘Conceptual Framework for Designing and Operating Internal Control over Financial Reporting’ established by the Operating Committee of Internal Control over Financial Reporting in Korea (the “ICFR Committee”) as the criteria for design and operation of the Bank’s ICFR. We also conducted an assessment of ICFR based on the ‘Management Guideline for Evaluating and Reporting Effectiveness of Internal Control over Financial Reporting’ established by the ICFR Committee.

Based on our assessment, we concluded that the Bank’s ICFR is designed and operated effectively as of December 31, 2022, in all material respects, in accordance with the ‘Conceptual Framework for Designing and Operating Internal Control over Financial Reporting’.

We certify that this report does not contain any untrue statement of a fact, or omit to state a fact necessary to be presented herein. We also certify that this report does not contain or present any statements which might cause material misunderstandings of the readers, and we have reviewed and verified this report with sufficient care.

February 24, 2023

Jae Keun Lee,

Chief Executive Officer

Jae Kwan Kim,

Internal Accounting Manager

210