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6-K 1 d492931d6k.htm FORM 6-K Form 6-K Table of Contents

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 August 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 ☐

Table of Contents

Index

1. Summary of the 2023 First Half Business Report

2. Exhibit 99.1 KB Financial Group Review Report for the First Half of 2023 (Consolidated)

3. Exhibit 99.2 KB Financial Group Review Report for the First Half of 2023 (Separate)

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TABLE OF CONTENTS


1.		Introduction to the Company

1.1.		Business Purpose

1.2.		History

1.3.		Overview of the Business Group

1.4.		Capital Structure

1.5.		Dividends

1.6.		Amendments to the Articles of Incorporation

2.		Business

2.1.		Results of Operations

2.2.		Sources and Uses of Funds

2.3.		Other Information to Consider in Making an Investment Decision

3.		Financial Information

3.1.		Consolidated Financial Information

3.2.		Separate Financial Information

3.3.		Other Selected Financial Data

3.4.		Other Financial Information

4.		Independent Public Accountants

4.1.		Audit/ Review Services

4.2.		Public Company Accounting Oversight Board (“PCAOB”) Audit Services

4.3.		Change in Auditor

5.		Corporate Governance and Affiliated Companies

5.1.		Board of Directors & Committees under the Board

5.2.		Audit Committee

5.3.		Compensation to Directors

5.4.		Top 5 Highest-Paid Individuals

5.5.		Affiliated Companies

6.		Directors, Senior Management and Employees

6.1.		Executive Directors

6.2.		Non-standing Directors

6.3.		Non-executive Directors

6.4.		Senior Management

6.5.		Employees

7.		Major Shareholders and Related Party Transactions

7.1.		Major Shareholders

7.2.		Changes in the Largest Shareholder

7.3.		Employee Stock Ownership Association

7.4.		Investments in Affiliated Companies

7.5.		Related Party Transactions

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Summary of 2023 First Half Business Report

On August 14, 2023, KB Financial Group Inc. (“KB Financial Group” or the “Group”) filed its business report for the first half of 2023 (the “Business Report”) with the Financial Services Commission of Korea and the Korea Exchange. This is a summary of the Business Report translated into English.

Except where indicated otherwise, financial information contained in this summary have been prepared in accordance with the Korean equivalent of International Financial Reporting Standards (“K-IFRS”), which differ in certain important respects from generally accepted accounting principles in the United States.

All references to “KB Financial Group,” “we,” “us” or the “Company” are to KB Financial Group and, unless the context requires otherwise, its subsidiaries. In addition, all references to “Won” or “KRW” in this document are to the currency of the Republic of Korea.

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1. Introduction to the Company

1.1. Business Purpose

KB Financial Group is a financial holding company that was established in September 2008. Its main business purpose is to hold shares in companies that are engaged in financial or related services, as well as govern and manage such companies. Its consolidated subsidiaries are primarily engaged in the banking business, as well as the credit card business, the financial investment business, the insurance business and other related businesses.

1.2. History

•

September 26, 2008

Obtained final approval from the Financial Services Commission to establish a financial holding company

•

September 29, 2008

Establishment of the Company through a comprehensive stock transfer and listing on the New York Stock Exchange

•

October 10, 2008

Listing on the Korea Exchange

•

October 20, 2008

The largest shareholder of the Company changed from the Korean National Pension Service to ING Bank N.V.

•

October 31, 2008

The largest shareholder of the Company changed from ING Bank N.V. to the Korean National Pension Service

•

May 4, 2009

Added Kookmin Bank Cambodia PLC. as a second-tier subsidiary

•

June 22, 2009

Added KB Life Insurance Co., Ltd. (“KB Life Insurance”), formerly a second-tier subsidiary, as a first-tier subsidiary

•

July 1, 2009

Changed the name of KB Venture Capital Co., Ltd. to KB Investment Co., Ltd. (“KB Investment”)

•

January 22, 2010

The largest shareholder of the Company changed from the Korean National Pension Service to ING Bank N.V.

•

March 2, 2011

Added KB Kookmin Card Co., Ltd. (“KB Kookmin Card”) as a first-tier subsidiary

•

March 14, 2011

KB Futures Co., Ltd. was merged into KB Investment & Securities Co., Ltd. (“KB Investment & Securities”)

•

July 8, 2011

The largest shareholder of the Company changed from ING Bank N.V. to the Korean National Pension Service

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•

January 13, 2012

Added KB Savings Bank Co., Ltd. (“KB Savings Bank”) as a first-tier subsidiary

•

May 11, 2012

Added KoFC POSCO HANWHA KB Shared Growth No. 2. Private Equity Fund as a second-tier subsidiary

•

July 2, 2012

Added KoFC Value-up Private Equity Fund as a second-tier subsidiary

•

October 10, 2012

Added Kookmin Bank (China) Ltd. as a second-tier subsidiary

•

June 20, 2013

Acquired the remaining shares of KB Life Insurance, which increased the Company’s shareholding to 100%

•

September 2, 2013

Added Yehansoul Savings Bank as a first-tier subsidiary

•

January 13, 2014

Yehansoul Savings Bank was merged into KB Savings Bank

•

March 20, 2014

Added KB Capital Co., Ltd. (“KB Capital”) as a first-tier subsidiary

•

June 24, 2015

Added KB Insurance Co., Ltd. (“KB Insurance”) as a non-consolidated first-tier subsidiary

•

November 23, 2015

Acquired additional shares of KB Insurance, which increased the Company’s shareholding from 19.47% to 33.29%

•

May 31, 2016

Added Hyundai Securities Co., Ltd. (“Hyundai Securities”) as a non-consolidated first-tier subsidiary

•

June 21, 2016

Disposed of LIG Investment & Securities, Co., Ltd., a second-tier subsidiary

•

June 28, 2016

Acquired treasury shares of Hyundai Securities, which increased the Company’s equity ownership in Hyundai Securities from 22.56% to 29.62%

•

December 1, 2016

Added KB Golden Life Care Co., Ltd. as a second-tier subsidiary

•

December 29, 2016

Established KB Private Equity Fund III as a second-tier subsidiary

•

December 30, 2016

Purchased new shares of KB Insurance in a rights offering, which increased the Company’s shareholding in KB Insurance from 33.29% to 39.81%

•

December 30, 2016

Merged KB Investment & Securities with and into Hyundai Securities, with Hyundai Securities as the surviving entity, then changed its name to KB Securities Co., Ltd. (“KB Securities”)

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•

February 8, 2017

Added KB KOLAO LEASING Co., Ltd. as a second-tier subsidiary

•

March 8, 2017

Added KB Microfinance Myanmar Co., Ltd. as a second-tier subsidiary

•

May 19, 2017

Acquired additional shares of KB Insurance in a tender offer, which increased the Company’s shareholding in KB Insurance from 39.81% to 94.30%

•

May 19, 2017

Acquired additional shares of KB Capital in a tender offer, which increased the Company’s shareholding in KB Capital from 52.02% to 79.70%

•

July 7, 2017

Converted KB Insurance and KB Capital into wholly-owned subsidiaries of the Company through comprehensive stock swaps

•

September 29, 2017

Added KB Asset Management Singapore Pte. Ltd. as a second-tier subsidiary (changed from a second-tier subsidiary of KB Securities to a first-tier subsidiary of KB Asset Management Co., Ltd.)

•

October 9, 2017

Added KB SECURITIES VIETNAM JOINT STOCK COMPANY (formerly MARITIME SECURITIES INCORPORATION) as a second-tier subsidiary

•

October 16, 2017

Disposed of Hyundai Savings Bank, Co., Ltd., a second-tier subsidiary

•

December 22, 2017

Disposed of Hyundai Asset Management, Co., Ltd., a second-tier subsidiary

•

January 17, 2018

Added KB-TS Technology Venture Private Equity Fund as a second-tier subsidiary (equity interests of 16%, 30% and 10% held by KB Securities, Kookmin Bank and KB Capital, respectively)

•

July 6, 2018

Added KB Daehan Specialized Bank PLC. as a second-tier subsidiary

•

August 21, 2018

Added KBAM Shanghai Advisory Services Co., Ltd. as a second-tier subsidiary

•

December 31, 2018

Added KB-Stonebridge Secondary Private Equity Fund as a second-tier subsidiary

•

January 9, 2019

Added KB-SPROTT Renewable Private Equity Fund I as a second-tier subsidiary

•

September 17, 2019

Added KB-SP Private Equity Fund IV as a second-tier subsidiary

•

February 28, 2020

Added KB-NAU Special Situation Corporate Restructuring Private Equity Fund as a second-tier subsidiary

•

April 10, 2020

Added PRASAC Microfinance Institution PLC. as a second-tier subsidiary Added PT Sunindo Kookmin Best Finance as a second-tier subsidiary

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•

May 18, 2020

•

July 3, 2020

Added PT KB Finansia Multi Finance as a second-tier subsidiary

•

August 31, 2020

Added Prudential Life Insurance Company of Korea, Ltd. (“Prudential Life Insurance”) as a first-tier subsidiary

•

September 2, 2020

Added PT Bank Bukopin Tbk as a second-tier subsidiary (renamed PT Bank KB Bukopin, Tbk. on February 8, 2021)

•

October 28, 2020

Added KB Material and Parts Private Equity Fund I as a second-tier subsidiary

•

December 4, 2020

Added FineKB Private Equity Fund I as a second-tier subsidiary

•

December 16, 2020

Added KB FINA JOINT STOCK COMPANY as a second-tier subsidiary

•

December 23, 2020

Added KB Bank Myanmar Co., Ltd. as a second-tier subsidiary

•

January 15, 2021

Added KB Bio Private Equity Fund III as a second-tier subsidiary

•

January 29, 2021

Added J Fintech Co., Ltd as a second-tier subsidiary (renamed KB J Capital Co., Ltd. on February 16, 2021)

•

March 2, 2021

Added PT KB Data Systems Indonesia as a second-tier subsidiary

•

September 23, 2021

Added KB Bio Global Expansion Private Equity Fund I as a second-tier subsidiary

•

October 8, 2021

Added KB Healthcare Co., Ltd. as a second-tier subsidiary

•

December 24, 2021

Added KB Co-investment Private Equity Fund I as a second-tier subsidiary

•

February 14, 2022

Added PT KB Valbury Sekuritas as a second-tier subsidiary

•

April 22, 2022

Added KB-Badgers Future Mobility ESG Private Equity Fund I as a second-tier subsidiary

•

May 10, 2022

Added KB Life Partners Co., Ltd. as a second-tier subsidiary

•

August 19, 2022

Added KB Mezzanine Capital Private Equity Fund IV as a second-tier subsidiary

•

December 26, 2022

Added i-Finance Leasing Plc. as a second-tier subsidiary

•

December 26, 2022

Renamed Prudential Life Insurance Company of Korea, Ltd. to KB Life Insurance Co., Ltd.

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•

January 1, 2023

Merged KB Life Insurance with and into KB Life Insurance Co., Ltd. (former Prudential Life Insurance Company of Korea, Ltd.)

•

June 30, 2023

Withdrew KB Credit Information Co., Ltd. as a first-tier subsidiary and added it as a second-tier subsidiary as it became a subsidiary of KB Kookmin Card Co., Ltd. (a first-tier subsidiary)

1.3.	Overview of the Business Group


			(As of June 30, 2023)
Type	Name of Company	Controlling Company	Remarks
Holding Company	KB Financial Group	—	Listed
1st Tier Subsidiaries	Kookmin Bank	KB Financial Group	Not listed
	KB Securities Co., Ltd.	KB Financial Group	Not listed
	KB Insurance Co., Ltd.	KB Financial Group	Not listed
	KB Kookmin Card Co., Ltd.	KB Financial Group	Not listed
	KB Life Insurance Co., Ltd.	KB Financial Group	Not listed
	KB Asset Management Co., Ltd.	KB Financial Group	Not listed
	KB Capital Co., Ltd.	KB Financial Group	Not listed
	KB Real Estate Trust Co., Ltd.	KB Financial Group	Not listed
	KB Savings Bank Co., Ltd.	KB Financial Group	Not listed
	KB Investment Co., Ltd.	KB Financial Group	Not listed
	KB Data Systems Co., Ltd.	KB Financial Group	Not listed
2nd Tier Subsidiaries	PT Bank KB Bukopin Tbk.(1)	Kookmin Bank	Listed (Overseas)
	Kookmin Bank Cambodia PLC.	Kookmin Bank	Not listed (Overseas)
	Kookmin Bank (China) Ltd.	Kookmin Bank	Not listed (Overseas)
	KB Microfinance Myanmar Co., Ltd.	Kookmin Bank	Not listed (Overseas)
	KB Bank Myanmar Co., Ltd.	Kookmin Bank	Not listed (Overseas)
	PRASAC Microfinance Institution PLC.	Kookmin Bank	Not listed (Overseas)
	KBFG Securities America Inc.	KB Securities	Not listed (Overseas)
	KB Securities Hong Kong Ltd.	KB Securities	Not listed (Overseas)
	Keystone-Hyundai Securities No. 1 Private Equity Fund(2)	KB Securities	Not listed
	KB SECURITIES VIETNAM JOINT STOCK COMPANY	KB Securities	Not listed (Overseas)
	KB-TS Technology Venture Private Equity Fund	KB Securities	Not listed
	KB-Stonebridge Secondary Private Equity Fund	KB Securities	Not listed
	KB-SPROTT Renewable Private Equity Fund I	KB Securities	Not listed
	KB-SP Private Equity Fund IV	KB Securities	Not listed
	KB-NAU Special Situation Corporate Restructuring Private Equity Fund	KB Securities	Not listed
	KB Material and Parts Private Equity Fund I	KB Securities	Not listed
	KB FINA JOINT STOCK COMPANY	KB Securities	Not listed (Overseas)

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			(As of June 30, 2023)
Type	Name of Company	Controlling Company	Remarks
	PT KB Valbury Sekuritas	KB Securities	Not listed (Overseas)
	KB Claims Survey & Adjusting Co., Ltd.	KB Insurance	Not listed
	KB Sonbo CNS	KB Insurance	Not listed
	Leading Insurance Services, Inc.	KB Insurance	Not listed (Overseas)
	KBFG Insurance (China) Co., Ltd.(3)	KB Insurance	Not listed (Overseas)
	PT. KB Insurance Indonesia	KB Insurance	Not listed (Overseas)
	KB Golden Life Care Co., Ltd.	KB Insurance	Not listed
	KB Healthcare Co., Ltd.	KB Insurance	Not listed
	KB Credit Information Co., Ltd.	KB Kookmin Card	Not listed
	KB Daehan Specialized Bank PLC.	KB Kookmin Card	Not listed (Overseas)
	PT KB Finansia Multi Finance	KB Kookmin Card	Not listed (Overseas)
	KB J Capital Co., Ltd(4)	KB Kookmin Card	Not listed (Overseas)
	i-Finance Leasing Plc.	KB Kookmin Card	Not listed (Overseas)
	KB Life Partners Co., Ltd.	KB Life Insurance	Not listed
	KB Asset Management Singapore Pte. Ltd.	KB Asset Management	Not listed (Overseas)
	KBAM Shanghai Advisory Services Co., Ltd.	KB Asset Management	Not listed (Overseas)
	KB Co-investment Private Equity Fund I	KB Asset Management	Not listed
	KB Mezzanine Capital Private Equity Fund IV	KB Asset Management	Not listed
	KB KOLAO LEASING Co., Ltd.	KB Capital	Not listed (Overseas)
	PT Sunindo Kookmin Best Finance	KB Capital	Not listed (Overseas)
	KoFC Value-up Private Equity Fund	KB Investment	Not listed
	FineKB Private Equity Fund I	KB Investment	Not listed
	KB Bio Global Expansion Private Equity Fund I	KB Investment	Not listed
	KB-Badgers Future Mobility ESG Private Equity Fund I	KB Investment	Not listed
	PT KB Data Systems Indonesia	KB Data Systems	Not listed (Overseas)
3rd Tier Subsidiaries	PT Bukopin Finance	PT Bank KB Bukopin Tbk.	Not listed (Overseas)
	PT Bank Syariah Bukopin	PT Bank KB Bukopin Tbk.	Not listed (Overseas)
	PT KB Valbury Capital Management	PT KB Valbury Sekuritas	Not listed (Overseas)
	Mangrove Master Fund	KB Asset Management Singapore Pte. Ltd.	Not listed (Overseas)
	Mangrove Feeder Fund	KB Asset Management Singapore Pte. Ltd.	Not listed (Overseas)

Notes:

(1) Renamed to PT Bank KB Bukopin, Tbk. from PT Bank Bukopin, Tbk. on February 8, 2021.

(2) Currently undergoing liquidation.

(3) Renamed to KBFG Insurance (China) Co., Ltd. from LIG Insurance (China) Co., Ltd. on April 9, 2021.

(4) Renamed to KB J Capital Co., Ltd from J Fintech Co., Ltd on February 16, 2021.

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1.4. Capital Structure

1.4.1. Common Shares

Changes in Capital


(As of June 30, 2023)		(Unit: Won, shares)
Date	Type	Number of Shares Issued or Cancelled		Par Value		Price		Remarks
September 29, 2008	Common Stock		356,351,693		5,000		48,444	Establishment of the Company
September 2, 2009	Common Stock		30,000,000		5,000		37,250	% increase in number of common shares: 8.41865%
October 19, 2016	Common Stock		31,759,844		5,000		35,474	% increase in number of common shares: 8.22045%
December 12, 2019	Common Stock		2,303,617		5,000		—	Share Cancellation(1)
February 14, 2022	Common Stock		3,455,426		5,000		—	Share Cancellation(1)
August 1, 2022	Common Stock		3,455,426		5,000		—	Share Cancellation(1)
April 4, 2023	Common Stock		5,385,996		5,000		—	Share Cancellation(1)

Note:

(1) The cancelled shares constituted treasury shares acquired pursuant to a resolution of the board of directors of the Company within the limits of profit available for dividend payment, and as such, there was no change in paid-in capital.

Number of Shares


(As of June 30, 2023)	(Unit: shares)
	Type
	Common Shares		Preferred Shares		Total		Remarks
Shares Authorized for Issuance		1,000,000,000		—		1,000,000,000		As specified in the Articles of Incorporation
Total Shares Issued (A)		418,111,537		—		418,111,537		—
Decrease in Number of Shares (B)		14,600,465		—		14,600,465		—
1. Capital Reduction		—		—		—		—
2. Cancellation		14,600,465		—		14,600,465		Treasury Shares
3. Redemption		—		—		—		—
4. Other		—		—		—		—
Shares Issued as of June 30, 2023 (C=A-B)		403,511,072		—		403,511,072		—
Treasury Shares (D)		19,262,733		—		19,262,733		—
Shares Outstanding (C-D)		384,248,339		—		384,248,339		—

Notes:

(1) The treasury shares above include five million treasury shares that the exchangeable bonds issued by the Company on June 30, 2020 can be exchanged for. Such treasury shares are currently deposited with Korea Securities Depositary and will be disposed upon the exercise of the exchange option of the exchangeable bonds. For more information, please refer to the Company’s report on Form 6-K furnished to the Securities and Exchange Commission on June 18, 2020.

(2) On July 25, 2023, the board of directors of the Company resolved to acquire and cancel certain of the Company’s treasury shares and accordingly, the Company has been acquiring its treasury shares since August 2, 2023. For more information, please refer to the Company’s report on Form 6-K furnished to the Securities and Exchange Commission on July 25, 2023.

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1.4.2. Voting Rights


(As of June 30, 2023)	(Unit: shares)
Items			Number of Shares		Notes
Total number of issued shares		Common shares		403,511,072		—
		Preferred shares		—		—
Shares without voting rights		Common shares		19,262,733		Treasury shares
		Preferred shares		—		—
Shares for which voting rights cannot be exercised pursuant to the Articles of Incorporation		—		—		—
Shares for which voting rights are restricted under relevant laws and regulations		—		—		—
Shares with restored voting rights		—		—		—
Total shares for which voting rights may be exercised		Common shares		384,248,339		—
		Preferred shares		—		—

Notes:

(1) The treasury shares above include five million treasury shares that the exchangeable bonds issued by the Company on June 30, 2020 can be exchanged for. Such treasury shares are currently deposited with the Korea Securities Depositary and will be disposed upon the exercise of the exchange option of the exchangeable bonds.

(2) On February 7, 2023, the board of directors of the Company resolved to acquire and cancel certain of the Company’s treasury shares and accordingly, the Company acquired its treasury shares from February 8, 2023 to March 29, 2023 and canceled such shares on April 4, 2023. For more information, please refer to the Company’s report on Form 6-K furnished to the Securities and Exchange Commission on March 29, 2023.

(3) On July 25, 2023, the board of directors of the Company resolved to acquire and cancel certain of the Company’s treasury shares and accordingly, the Company has been acquiring its treasury shares since August 2, 2023. For more information, please refer to the Company’s report on Form 6-K furnished to the Securities and Exchange Commission on July 25, 2023.

1.5. Dividends

KB Financial Group aims to manage its CET1 target ratio at a minimum of around 13% (the regulatory requirement of 10.5% plus a management buffer of 250 bps), in order to meet the regulatory requirement of 10.5% even in the face of severe economic shocks and other macroeconomic variables, including fluctuations in exchange rates and interest rates.

In order to manage such CET1 target ratio, the Group plans to benchmark systemic growth indicators, such as nominal GDP growth rates, to set its mid-term goals for asset growth. However, the Group may modify such goals to better fulfill the Group’s public role and to attain sustainable growth in light of changes to the macroeconomic and regulatory environment, the importance and role of the financial industry, including banks, in the domestic economy, the Group’s public duty to maintain the stability of the social system, or the Group’s business objectives such as investments in new businesses or M&A initiatives.

Generally, the Group’s policy is to utilize the excess capital exceeding its target CET1 ratio of 13% to actively return value to its shareholders. Although the level of shareholder returns may vary depending on changes in the regulatory environment, volatility in the financial market, and the Group’s business objectives, the Group will strive to maximize its shareholder returns and shareholders’ value in every situation.

As a leading financial institution in Korea, KB Financial Group will strive to perform its public duties as a bank in times of need, such as stabilizing the financial system and supporting the soft landing of the economy during economic fluctuations. The Group will take into consideration the interests of various stakeholders, including shareholders, employees, consumers, and local communities, to achieve sustainable growth while also enhancing shareholder value.

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Based on its solid fundamentals and the highest level of capital in the industry, the Group achieved a shareholder return rate of approximately 30%, including through share buybacks and cancellations. The Group plans to actively continue such progressive shareholder return policy.

KB Financial Group also plans to provide a stable payout to the shareholders, taking into consideration the global best practices for dividend stability by maintaining at least the previous year’s level of cash dividends while gradually expanding the dividend per share and engaging in share buybacks and cancellations. However, such plans may be modified depending on economic conditions, regulatory environment, or the Group’s business objectives.


		(Unit: in millions of Won, except per share amounts and percentages)
Items		January 1, 2023 to June 30, 2023(1)		January 1, 2022 to December 31, 2022(2)		January 1, 2021 to December 31, 2021(3)
Par value per share (Won)			5,000		5,000		5,000
(Consolidated) Net income			2,996,687		4,394,830		4,409,543
(Consolidated) Earnings per share (Won)			7,530		10,955		11,134
Total cash dividends			391,934		1,149,421		1,145,525
Total stock dividends			—		—		—
(Consolidated) Cash dividend payout ratio (%)			13.1		26.0		26.0
Cash dividend yield (%)	Common shares		1.1		5.8		5.2
	—		—		—		—
Stock dividend yield (%)	Common shares		—		—		—
	—		—		—		—
Cash dividend per share (Won)	Common shares		1,020		2,950		2,940
	—		—		—
Stock dividend per share	Common shares		—		—
	—		—		—


Notes:		(1) Includes a quarterly dividend amount of Won 195,967 million (Won 510 per common share) for the first quarter of fiscal year 2023, and a quarterly dividend amount of Won 195,967 million (Won 510 per common share) in the second quarter of fiscal year 2022.
		(2) Includes a quarterly dividend amount of Won 194,817 million (Won 500 per common share) in the first quarter of fiscal year 2022, a quarterly dividend amount of Won 194,817 million (Won 500 per common share) in the second quarter of fiscal year 2022, and a quarterly dividend amount of Won 194,817 million (Won 500 per common share) in the third quarter of fiscal year 2022.
		(3) Includes a quarterly dividend amount of Won 292,226 million (Won 750 per common share) in the second quarter of fiscal year 2021.

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1.6. Amendments to the Articles of Incorporation

The Company’s Articles of Incorporation were most recently amended on March 24, 2023.


Date	Shareholder meeting through which the amendments were approved and ratified	Major changes	Notes
March 24, 2023	Annual General Meeting of Shareholders for Fiscal Year 2022	Establishment of: (i) the basis for determining the record date for the payment of dividends through a resolution of the Board of Directors, and (ii) an equal dividend payment policy with respect to shares in the same class, through the amendment of articles 10, 11, 15, 16, 17, 18, 19, 20, 49, 59, and 60	Establishment of the basis for determining the record date for the payment of dividends through a resolution of the Board of Directors
March 20, 2020	Annual General Meeting of Shareholders for Fiscal Year 2019	Establishment of the ESG Committee within the board of directors through the amendment of article 48	Establishment of the basis for creating a new committee within the board of directors
March 27, 2019	Annual General Meeting of Shareholders for Fiscal Year 2018	Establishment of the basis for electronic registration of shares and bonds, and modification of the processing activities of transfer agents through the amendment of articles 9, 16, 17, 19 and 22	Amendment to articles pursuant to the Act on Electronic Registration of Stocks, Bonds, Etc. (Effective as of September 2019)

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2. Business

2.1. Results of Operations


							(Unit: in millions of Won)
	For the six months ended June 30, 2023			For the six months ended June 30, 2022			For the year ended December 31, 2022			For the year ended December 31, 2021
Net interest income		5,759,263			5,472,763			11,393,422			11,229,572
Interest income		13,997,243			8,999,760			20,787,577			15,210,878
Interest expense		(8,237,980	)		(3,526,997	)		(9,394,155	)		(3,981,306	)
Net fee and commission income		1,865,410			1,891,812			3,514,902			3,625,583
Fee and commission income		2,696,416			2,650,233			5,125,930			5,323,606
Fee and commission expense		(831,006	)		(758,421	)		(1,611,028	)		(1,698,023	)
Insurance service result		812,121			815,571			1,334,090			556,711
Insurance income		5,337,499			4,784,118			10,066,863			16,107,858
Insurance expense		(4,525,378	)		(3,968,547	)		(8,732,773	)		(15,551,147	)
Net gains on financial assets/liabilities at fair value through profit or loss		1,159,314			(1,198,796	)		(1,133,475	)		995,304
Other insurance finance income		(221,149	)		655,752			897,441			—
Net other operating expenses		(718,208	)		(754,156	)		(2,268,465	)		(1,923,567	)
General and administrative expenses		(3,159,228	)		(3,034,232	)		(6,643,654	)		(7,200,853	)
Operating profit before provision for credit losses		5,497,523			3,848,714			7,094,261			7,282,750
Provision for credit losses		(1,319,485	)		(475,543	)		(1,847,775	)		(1,185,133	)
Net operating profit		4,178,038			3,373,171			5,246,486			6,097,617

Notes:

(1) Based on K-IFRS (on a consolidated basis).

(2) KB Financial Group’s results of operations for the six months ended June30, 2023 reflect the application of K-IFRS 1117 (Insurance Contracts), a new accounting standard that became effective on January 1, 2023. For comparison purposes, the figures for the six months ended June 30, 2022 and the year ended December 31, 2022 above have been restated retrospectively to reflect the application of K-IFRS 1117. However, the figures for the year ended December 31, 2021 have not been restated retrospectively and are based on K-IFRS 1104 (Insurance Contracts). Accordingly, such figures may not be directly comparable with the figures for the six months ended June 30, 2022 and 2023 and the year ended December 31, 2022.

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2.2.	Sources and Uses of Funds

2.2.1.

Sources of Funds


														(Unit: in millions of Won)
		For the six months ended June 30, 2023						For the year ended December 31, 2022						For the year ended December 31, 2021
		Average Balance		Interest Rate (%)		Ratio (%)		Average Balance		Interest Rate (%)		Ratio (%)		Average Balance		Interest Rate (%)		Ratio (%)
Won Currency	Deposits		333,226,924		2.48		45.10		333,078,280		1.27		47.87		309,428,469		0.74		49.09
	Certificate of deposit		8,356,755		4.04		1.13		5,511,822		2.35		0.79		3,618,303		0.87		0.57
	Borrowings		33,910,858		3.17		4.59		31,064,028		1.91		4.46		24,900,706		0.96		3.95
	Call money		1,449,425		3.45		0.20		1,314,525		2.02		0.19		1,324,902		0.65		0.21
	Debentures		56,273,747		3.27		7.62		58,290,290		2.39		8.38		57,214,310		1.82		9.08
	Others		22,479,213		4.17		3.04		20,866,612		2.34		3.00		20,305,205		0.84		3.22

Subtotal			455,696,922		2.74		61.68		450,125,557		1.52		64.69		416,791,895		0.91		66.12

Foreign Currency	Deposits		36,653,936		3.65		4.96		34,076,754		2.09		4.90		26,607,162		1.70		4.22
	Borrowings		24,652,245		3.56		3.34		22,970,783		1.90		3.30		12,976,574		1.16		2.06
	Call money		1,920,208		3.04		0.26		1,572,913		1.87		0.23		995,957		0.75		0.16
	Debentures		12,961,820		3.05		1.75		11,978,139		2.09		1.72		8,544,738		1.49		1.36
	Others		1,055,372		3.39		0.15		1,685,165		1.46		0.24		2,029,862		0.82		0.32

Subtotal			77,243,581		3.50		10.46		72,283,754		2.01		10.39		51,154,293		1.47		8.12

Others	Total shareholders’ equity		93,835,535		—		12.70		67,612,953		—		9.72		46,705,724		—		7.41
	Allowances		1,025,133		—		0.14		1,128,687		—		0.16		1,040,835		—		0.17
	Others		111,013,278		—		15.02		104,628,576		—		15.04		114,646,087		—		18.18

Subtotal			205,873,946		—		27.86		173,370,216		—		24.92		162,392,646		—		25.76

Total			738,814,449		—		100.00		695,779,527		—		100.00		630,338,834		—		100.00

Notes:

(1) Based on K-IFRS (on a consolidated basis).

(2) The figures for the six months ended June 30, 2023 reflect the application of K-IFRS 1117 (Insurance Contracts), a new accounting standard that became effective on January 1, 2023. The figures for the year ended December 31, 2022 above have been restated retrospectively to reflect the application of K-IFRS 1117. However, the figures for the year ended December 31, 2021 have not been restated retrospectively and are based on K-IFRS 1104 (Insurance Contracts). Accordingly, such figures may not be directly comparable with the figures for the six months ended June 30, 2023 and the year ended December 31, 2022.

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2.2.2.

Uses of Funds


																		(Unit: in millions of Won)
		For the six months ended June 30, 2023								For the year ended December 31, 2022								For the year ended December 31, 2021
		Average Balance			Interest Rate (%)		Ratio (%)			Average Balance			Interest Rate (%)		Ratio (%)			Average Balance			Interest Rate (%)		Ratio (%)
Won Currency	Due from banks		16,401,577			0.95		2.22			16,038,688			0.63		2.31			15,212,672			0.30		2.41
	Securities		198,808,898			2.46		26.91			166,950,909			1.17		23.99			147,320,309			1.31		23.37
	Loans		366,405,873			4.73		49.59			361,188,713			3.51		51.91			340,131,319			2.80		53.96
	Guarantee payments under payment guarantee		3,432			0.33		—			6,891			0.19		—			5,053			1.31		—
	Call loan		222,065			3.60		0.03			694,196			2.02		0.10			695,721			0.67		0.11
	Private placement corporate bonds		1,139,474			3.31		0.15			828,547			3.43		0.12			882,497			3.02		0.14
	Credit cards		22,642,137			7.80		3.06			22,069,290			6.94		3.17			19,862,308			7.09		3.15
	Others		3,500,433			16.27		0.48			4,438,987			9.45		0.64			4,193,384			6.53		0.67
	Allowance		(3,345,855	)		—		(0.45	)		(2,814,578	)		—		(0.40	)		(2,480,441	)		—		(0.39	)

Subtotal			605,778,034			4.09		81.99			569,401,643			2.94		81.84			525,822,822			2.51		83.42

Foreign Currency	Due from banks		9,241,891			2.00		1.25			9,239,891			0.76		1.33			6,868,969			0.38		1.09
	Securities		26,904,173			3.93		3.64			20,610,143			1.81		2.96			16,052,962			3.90		2.55
	Loans		39,568,585			6.80		5.36			37,267,941			5.32		5.36			26,409,776			5.05		4.19
	Call loan		6,986,972			4.20		0.95			8,829,592			2.12		1.27			3,275,072			0.45		0.52
	Bills bought		2,162,045			5.36		0.29			2,541,838			2.32		0.37			1,940,984			0.73		0.31
	Allowance		(1,335,578	)		—		(0.18	)		(1,021,192	)		—		(0.15	)		(978,088	)		—		(0.16	)
	Others		3,098,076			—		0.42			2,248,320			—		0.32			2,229,707			—		0.35

Subtotal			86,626,164			5.07		11.73			79,716,533			3.38		11.46			55,799,382			3.63		8.85

Others	Cash		1,712,643			—		0.23			1,831,093			—		0.26			1,917,967			—		0.30
	Fixed assets held for business		8,716,897			—		1.18			8,077,249			—		1.16			8,130,268			—		1.29
	Others		35,980,711			—		4.87			36,753,009			—		5.28			38,668,395			—		6.14

Subtotal			46,410,251			—		6.28			46,661,351			—		6.70			48,716,630			—		7.73

Total			738,814,449			—		100.00			695,779,527			—		100.00			630,338,834			—		100.00

Notes:

(1) Based on K-IFRS (on a consolidated basis).

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2.3.	Other Information to Consider in Making an Investment Decision

2.3.1.

Capital Adequacy


KB Financial Group				(Unit: in billions of Won, except percentages)

	As of June 30, 2023			As of December 31, 2022			As of December 31, 2021
Total capital (A)		52,757			48,970			45,883
Risk-weighted assets (B)		311,221			302,984			290,914
BIS ratio (A/B)		16.95	%		16.16	%		15.77	%

Notes:

(1) Calculated in accordance with Basel III.

(2) The figures as of June 30, 2023 are preliminary.


Kookmin Bank				(Unit: in billions of Won, except percentages)

	As of June 30, 2023			As of December 31, 2022			As of December 31, 2021
Total capital (A)		38,503			36,233			35,572
Risk-weighted assets (B)		208,706			207,558			203,569
BIS ratio (A/B)		18.45	%		17.46	%		17.47	%

Notes:

(1) Calculated in accordance with Basel III.


KB Securities Co., Ltd.				(Unit: in billions of Won, except percentages)

	As of June 30, 2023			As of December 31, 2022			As of December 31, 2021
Net operating capital (A)		4,793			4,554			3,982
Total amount at risk (B)		2,790			2,655			2,072
Maintenance equity margin (C)		134			134			134
Net capital ratio (A-B)/(C)		1,492.29	%		1,414.74	%		1,422.34	%
Capital surplus (A-B)		2,003			1,899			1,909

KB Insurance Co., Ltd.				(Unit: in billions of Won, except percentages)

	As of June 30, 2023			As of December 31, 2022			As of December 31, 2021
Available capital (A)		11,159			4,608			4,349
Required capital (B)		5,733			2,684			2,424
Capital Adequacy ratio (A/B)(2)		193.96	%		171.66	%		179.39	%

Notes:

(1) The figures as of June 30, 2023 are preliminary.

(2) Pursuant to the change in capital adequacy system from the Risk-Based Capital (“RBC”) system to the Korean Insurance Capital Standard (“K-ICS”) system, the capital adequacy ratio as of June 30, 2023 was calculated based on the K-ICS method, whereas the figures as of December 31, 2022 and December 31, 2021 were calculated based on the RBC method.

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2.3.2.

Overseas Credit Ratings


			(As of June 30, 2023)
Rating Company	Moody’s		S&P
Type	Long-term	Short-term	Long-term	Short-term
Credit Rating	A1	P-1	A	A-1

2.3.3.

Domestic Credit Ratings


Date of Rating	Type	Credit Rating	Rating Company (Rating Range)

1/12/2021	Debentures	AAA	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

2/3/2021	Contingent Convertible Bonds	AA-	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

2/19/2021	Debentures	AAA	KIS Ratings (AAA ~ D)

2/22/2021	Debentures	AAA	Korea Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

5/14/2021	Contingent Convertible Bonds	AA-	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

6/25/2021	Commercial Paper	A1	Korea Ratings (A1 ~ D) / KIS Ratings (A1 ~ D) / NICE Investors Service (A1 ~ D)

9/24/2021	Contingent Convertible Bonds	AA-	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

1/27/2022	Contingent Convertible Bonds	AA-	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D)

1/28/2022	Contingent Convertible Bonds	AA-	NICE Investors Service (AAA ~ D)

4/29/2022	Contingent Convertible Bonds	AA-	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

6/2/2022	Debentures	AAA	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

6/20/2022	Commercial Paper	A1	Korea Ratings (A1 ~ D) / KIS Ratings (A1 ~ D) / NICE Investors Service (A1 ~ D)

8/16/2022	Contingent Convertible Bonds	AA-	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

1/19/2023	Contingent Convertible Bonds	AA-	Korea Ratings (AAA ~ D) / KIS Ratings (AAA ~ D) / NICE Investors Service (AAA ~ D)

2.3.4.

Early Retirement Program

To enhance productivity by improving its labor structure, Kookmin Bank implemented a voluntary early retirement program following negotiations with its labor union.


Subsidiary	Date of Retirement	Number of Retired Persons
Kookmin Bank	January 28, 2019	615
	January 20, 2020	462
	January 30, 2021	800
	January 21, 2022	674
	January 18, 2023	713

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2.3.5.

Other Factors Affecting the Group’s Financial Condition and Results of Operations

The economic outlook for Korea and its financial services sector in 2023 and for the foreseeable future remains highly uncertain as a result of, among others, (i) volatile conditions in the Korean and global economies and financial markets resulting from interest and exchange rate fluctuations, lower consumer confidence, stock market and real estate market volatility and changes in fiscal and monetary policies, and (ii) adverse conditions in the Korean and global economies and financial markets resulting from Russia’s invasion of Ukraine and its effects on global commodity prices, as well as difficulties faced by certain banks in the United States.

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3.	Financial Information

3.1.	Consolidated Financial Information

3.1.1.

Consolidated Statements of Financial Position


					(Unit: in millions of Won)
	As of June 30, 2023		As of December 31, 2022		As of December 31, 2021
Cash and due from financial institutions		31,610,850		32,474,750		31,009,374
Financial assets at fair value through profit or loss		74,604,619		70,092,497		66,005,815
Derivative financial assets		8,195,304		9,446,580		3,721,370
Loans measured at amortized cost		434,953,555		433,038,931		417,900,273
Financial investments		116,969,558		115,452,659		104,847,871
Investments in associates and joint ventures		666,893		682,670		448,718
Insurance assets		189,214		83,304		—
Reinsurance assets		1,529,427		1,495,966		—
Property and equipment		4,956,129		4,991,467		5,239,898
Investment property		3,505,583		3,148,340		2,514,944
Intangible assets		1,956,545		1,858,470		3,266,357
Net defined benefit assets		468,642		478,934		100,083
Current income tax assets		242,981		204,690		98,798
Deferred income tax assets		271,776		188,372		159,093
Assets held for sale		228,811		211,758		237,318
Assets of a disposal group held for sale		—		—		171,749
Other assets		25,967,859		14,815,438		28,174,173
Total assets		706,317,746		688,664,826		663,895,834
Financial liabilities at fair value through profit or loss		12,044,419		12,271,604		12,088,980
Derivative financial liabilities		7,999,757		9,509,769		3,682,258
Deposits		396,081,606		393,928,904		372,023,918
Borrowings		69,261,997		71,717,366		56,912,374
Debentures		68,260,644		68,698,203		67,430,188
Insurance contract liabilities		46,840,867		45,920,012		57,165,936
Reinsurance contract liabilities		33,791		31,728		—
Provisions		978,309		933,701		808,604
Net defined benefit liabilities		112,351		85,745		225,521
Current income tax liabilities		507,874		998,681		662,672
Deferred income tax liabilities		2,044,588		1,574,954		1,470,981
Other liabilities		44,446,638		28,849,911		43,130,482

Total liabilities		648,612,841		634,520,578		615,601,914

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	As of June 30, 2023			As of December 31, 2022			As of December 31, 2021
Equity attributable to shareholders of the parent company		55,670,465			52,864,146			47,460,582
Share capital		2,090,558			2,090,558			2,090,558
Hybrid securities		5,032,803			4,434,251			2,838,221
Capital surplus		16,649,233			16,940,731			16,940,231
Accumulated other comprehensive income (loss)		1,910,088			1,312,522			1,047,274
Accumulated other comprehensive income relating to assets of a disposal group held for sale		—			—			7,671
Retained earnings		30,853,620			28,922,272			25,672,815
Treasury shares		(865,837	)		(836,188	)		(1,136,188	)
Non-controlling interests		2,034,440			1,280,102			833,338
Total equity		57,704,905			54,144,248			48,293,920

Total liabilities and equity		706,317,746			688,664,826			663,895,834


Notes:	(1)	The figures as of June 30, 2023 reflect the application of K-IFRS 1117 (Insurance Contracts), and the figures as of December 31, 2022 have been restated retrospectively to reflect the application of K-IFRS 1117.
	(2)	The figures as of December 31, 2021 are based on K-IFRS 1104 (Insurance Contracts). Accordingly, such figures may not be directly comparable with the figures as of June 30, 2023 and December 31, 2022.

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3.1.2.

Consolidated Statements of Comprehensive Income


				(Unit: in millions of Won, except per share amounts)

	For the six months ended June 30, 2023			For the six months ended June 30, 2022			For the year ended December 31, 2022			For the year ended December 31, 2021
Net interest income		5,759,263			5,472,763			11,393,422			11,229,572
Interest income		13,997,243			8,999,760			20,787,577			15,210,878
Interest income from financial instruments at fair value through other comprehensive income and amortized cost		13,311,319			8,594,390			19,841,175			14,620,490
Interest income from financial instruments at fair value through profit or loss		674,626			396,149			929,735			590,388
Insurance finance interest income		11,298			9,221			16,665			—
Interest expense		(8,237,980	)		(3,526,997	)		(9,394,155	)		(3,981,306	)
Interest expense		(7,368,295	)		(2,709,030	)		(7,776,631	)		(3,981,306	)
Insurance finance interest expense		(869,684	)		(775,843	)		(1,617,524	)		—
Net fee and commission income		1,865,410			1,891,812			3,514,902			3,625,583
Fee and commission income		2,696,416			2,650,233			5,125,930			5,323,606
Fee and commission expense		(831,006	)		(758,421	)		(1,611,028	)		(1,698,023	)
Insurance service result		812,121			815,571			1,334,090			556,711
Insurance income		5,337,499			4,784,118			10,066,863			16,107,858
Insurance income		5,061,978			4,641,295			9,544,474			16,107,858
Reinsurance income		275,521			142,823			522,389			—
Insurance expense		(4,525,378	)		(3,968,547	)		(8,732,773	)		(15,551,147	)
Insurance service expense		(4,120,869	)		(3,613,984	)		(7,961,019	)		(15,551,147	)
Reinsurance expense		(404,509	)		(354,563	)		(771,754	)		—
Net gains (losses) on financial assets/liabilities at fair value through profit or loss		1,159,314			(1,198,796	)		(1,133,475	)		995,304
Net gains (losses) on financial instruments at fair value through profit or loss before applying overlay approach		1,159,314			(1,198,796	)		(1,133,475	)		1,160,981
Losses on overlay adjustments		—			—			—			(165,677	)
Other insurance finance income (expenses) from contract held		(221,149	)		655,752			897,441			—
Net other operating expenses		(718,208	)		(754,156	)		(2,268,465	)		(1,923,567	)
General and administrative expenses		(3,159,228	)		(3,034,232	)		(6,643,654	)		(7,200,853	)
Operating income before provision for credit losses		5,497,523			3,848,714			7,094,261			7,282,750
Provision for credit losses		(1,319,485	)		(475,543	)		(1,847,775	)		(1,185,133	)
Net operating income		4,178,038			3,373,171			5,246,486			6,097,617

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	For the six months ended June 30, 2023			For the six months ended June 30, 2022			For the year ended December 31, 2022			For the year ended December 31, 2021
Net non-operating income (expenses)		(188,514	)		201,928			160,569			(16,011	)
Share of profit (loss) of associates and joint ventures		4,449			(19,859	)		(28,755	)		93,526
Net other non-operating income (expenses)		(192,963	)		221,787			189,324			(109,537	)
Profit before income tax expense		3,989,524			3,575,099			5,407,055			6,081,606
Income tax expense		(985,539	)		(889,079	)		(1,506,961	)		(1,697,225	)
Profit for the period		3,003,985			2,686,020			3,900,094			4,384,381
Other comprehensive income (loss) for the period, net of tax		633,641			(108,402	)		146,661			222,758
Items that will not be reclassified to profit or loss:		(54,018	)		(741,779	)		60,938			871,654
Remeasurements of net defined benefit liabilities		9,940			(31,712	)		239,701			(45,510	)
Share of other comprehensive income (loss) of associates and joint ventures		(2	)		(2	)		183			51
Gains (losses) on equity securities at fair value through other comprehensive income		(13,371	)		(717,299	)		(217,801	)		903,398
Fair value changes of financial liabilities designated at fair value through profit or loss due to own credit risk		(50,585	)		7,234			38,855			13,715
Items that may be reclassified subsequently to profit or loss:		687,659			633,377			85,723			(648,896	)
Currency translation differences		91,958			265,794			165,568			255,907
Gains (losses) on debt securities at fair value through other comprehensive income		826,524			(4,673,299	)		(6,057,152	)		(924,698	)
Share of other comprehensive income (loss) of associates and joint ventures		(1,181	)		23			(545	)		498
Gains (losses) on cash flow hedging instruments		(14,232	)		21,231			26,168			20,864
Losses on hedging instruments of net investments in foreign operations		(39,396	)		(95,983	)		(79,085	)		(57,935	)
Insurance finance income (expenses)		(176,014	)		5,115,611			6,030,769			—
Other comprehensive losses arising from separate accounts		—			—			—			(63,814	)
Gains on overlay adjustment		—			—			—			120,282
Total comprehensive income for the period		3,637,626			2,577,618			4,046,755			4,607,139
Profit attributable to:		3,003,985			2,686,020			3,900,094			4,384,381
Shareholders of the parent company		2,996,687			2,670,523			4,121,685			4,409,543
Non-controlling interests		7,298			15,497			(221,591	)		(25,162	)

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	For the six months ended June 30, 2023		For the six months ended June 30, 2022		For the year ended December 31, 2022			For the year ended December 31, 2021
Total comprehensive income for the period attributable to:		3,637,626		2,577,618		4,046,755			4,607,139
Shareholders of the parent company		3,620,720		2,546,532		4,254,807			4,610,549
Non-controlling interests		16,906		31,086		(208,052	)		(3,410	)
Earnings per share
Basic earnings per share (Won)		7,530		6,723		10,254			11,134
Diluted earnings per share (Won)		7,360		6,572		10,021			10,890


Notes:	(1)	The figures for the six months ended June 30, 2023 reflect the application of K-IFRS 1117 (Insurance Contracts), and the figures for the six months ended June 30, 2022 and the year ended December 31, 2022 above have been restated retrospectively to reflect the application of K-IFRS 1117.
	(2)	The figures for the year ended December 31, 2021 are based on K-IFRS 1104 (Insurance Contracts). Accordingly, such figures may not be directly comparable with the figures for the six months ended June 30, 2023 and 2022 and the year ended December 31, 2022.

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3.2.	Separate Financial Information

3.2.1.

Separate Statements of Financial Position


							(Unit: in millions of Won)
	As of June 30, 2023			As of December 31, 2022			As of December 31, 2021
Cash and due from financial institutions		1,202,390			351,056			608,076
Financial assets at fair value through profit or loss		1,548,931			1,522,314			440,760
Loans measured at amortized cost		522,326			522,326			249,128
Investments in subsidiaries		26,717,817			26,741,438			26,741,438
Property and equipment		2,627			3,552			4,444
Intangible assets		15,505			16,752			16,673
Net defined benefit assets		3,532			4,288			221
Deferred income tax assets		11,574			19,904			5,583
Other assets		669,530			1,272,197			805,056

Total assets		30,694,232			30,453,827			28,871,379

Debentures		4,169,434			4,956,949			5,552,791
Current income tax liabilities		463,881			926,573			570,519
Other liabilities		195,516			338,489			235,095

Total liabilities		4,828,831			6,222,011			6,358,405

Share capital		2,090,558			2,090,558			2,090,558
Hybrid securities		5,032,518			4,433,981			2,837,981
Capital surplus		14,754,747			14,754,747			14,754,747
Accumulated other comprehensive loss		(5,822	)		(5,847	)		(8,330	)
Retained earnings		4,859,237			3,794,565			3,974,206
Treasury Shares		(865,837	)		(836,188	)		(1,136,188	)

Total equity		25,865,401			24,231,816			22,512,974

Total liabilities and equity		30,694,232			30,453,827			28,871,379

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3.2.2.

Separate Statements of Comprehensive Income


	(Unit: in millions of Won, except per share amounts)
	For the six months ended June 30, 2023			For the six months ended June 30, 2022			For the year ended December 31, 2022			For the year ended December 31, 2021
Net interest expense		(33,434	)		(47,107	)		(92,951	)		(111,077	)
Interest income		18,149			7,485			19,402			9,392
Interest income from financial instruments at amortized cost		16,351			6,165			16,525			6,548
Interest income from financial instruments at fair value through profit or loss		1,798			1,320			2,877			2,844
Interest expense		(51,583	)		(54,592	)		(112,353	)		(120,469	)
Net fee and commission expense		(4,336	)		(4,135	)		(8,686	)		(8,157	)
Fee and commission income		781			1,159			3,399			975
Fee and commission expense		(5,117	)		(5,294	)		(12,085	)		(9,132	)
Net gains (losses) on financial assets at fair value through profit or loss		51,670			(16,860	)		(11,794	)		20,250
Net other operating income		2,192,380			1,671,224			1,871,224			1,620,238
General and administrative expenses		(45,881	)		(41,646	)		(89,149	)		(85,417	)
Operating profit before provision for credit losses		2,160,399			1,561,476			1,668,644			1,435,837
Reversal of provision for credit losses		(7	)		(2	)		(303	)		(417	)
Operating profit		2,160,392			1,561,474			1,668,341			1,435,420
Net non-operating income (expense)		4,406			(435	)		908			1,165
Profit before income tax		2,164,798			1,561,039			1,669,249			1,436,585
Income tax income (expense)		(8,321	)		8,644			15,263			2,281
Profit for the year		2,156,477			1,569,683			1,684,512			1,438,866
Other comprehensive income (loss) for the year, net of tax		25			(281	)		2,483			(298	)
Items that will not be reclassified to profit or loss:		25			(281	)		2,483			(298	)
Remeasurements of net defined benefit liabilities		25			(281	)		2,483			(298	)
Total comprehensive income for the year		2,156,502			1,569,402			1,686,995			1,438,568
Earnings per share
Basic earnings per share (Won)		5,354			3,897			3,999			3,509
Diluted earnings per share (Won)		5,234			3,811			3,912			3,436

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3.3.	Other Selected Financial Data

3.3.1.

Won-denominated Liquidity Ratio


	(Unit: in millions of Won, except percentages)
	As of June 30, 2023			As of December 31, 2022			As of December 31, 2021
Current assets in Won (A)		1,946,491			959,935			713,908
Current liabilities in Won (B)		334,642			592,727			317,184
Liquidity ratio (A/B)		581.66	%		161.95	%		225.08	%

Notes:

(1) Based on K-IFRS (on a separate basis).

(2)

Calculated based on Won-denominated assets and liabilities due within one month.

3.3.2.

Profitability Ratios


					(Unit: %)
	For the six months ended June 30, 2023		For the year ended December 31, 2022		For the year ended December 31, 2021
Net income as a percentage of average total assets (ROA)		0.87		0.60		0.69
Net income as a percentage of average shareholders’ equity (ROE)		11.12		9.24		9.80

Note:

Based on K-IFRS (on a consolidated basis).

3.3.3.

20 Largest Exposures of Kookmin Bank by Borrower (As of June 30, 2023)


	(Unit: in billions of Won)
Company	Credit Extended
LG Display Co., Ltd.		2,200
KB Kookmin Card Co., Ltd.		1,277
HD Hyundai Heavy Industries Co., Ltd.		1,271
Samsung Heavy Industries Co., Ltd.		1,150
E-MART Inc.		1,137
Samsung Electronics Co., Ltd.		1,125
SK Inc		998
Strada Holdco L.P.		949
SK on Co., Ltd.		848
POSCO International Corporation		835
Samsung SDI Co., Ltd.		818
Bank of Communication		810
Hyundai Steel Co., Ltd.		806
GS Caltex Corporation		786
Hyundai Samho Heavy Industries Co.,Ltd.		746
Hyundai Motor Company		741
SK hynix Inc.		710
LS MnM Inc.		700
Shinhan Card Co., Ltd.		689
Hanwha Ocean Co., Ltd.		668

Total		19,264

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3.3.4.

10 Largest Exposures of Kookmin Bank by Chaebol Group (As of June 30, 2023)


	(Unit: in billions of Won)
Group	Credit Extended
SK		6,137
Samsung		4,491
Hyundai Motor		4,451
LG		4,237
HD Hyundai (former Hyundai Heavy Industries)		3,488
Lotte		3,298
Hanwha		2,019
POSCO		1,840
Shinsegae		1,587
GS		1,553

Total		33,100

3.3.5.

Kookmin Bank’s Loan Concentration by Industry (As of June 30, 2023)


	(Unit: in billions of Won, except percentages)
Industry	Total Credit		Percentage of Total Credit
Manufacturing		55,243		27.2
Construction		4,431		2.2
Real estate activities		49,519		24.4
Wholesale and retail trade		30,177		14.9
Accommodation and food service activities		10,435		5.1
Financial activities		7,534		3.7
Others		45,451		22.4

Total		202,789		100.0

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3.3.6. Top 20 Non-Performing Loans of Kookmin Bank (As of June 30, 2023)


		(Unit: in billions of Won)
Borrower	Industry	Total Credit		Allowance for Loan Losses
Borrower A	Construction		40.1		39.3
Borrower B	Wholesale and retail trade		17.4		15.5
Borrower C	Manufacturing		10.1		4.3
Borrower D	Manufacturing		8.3		2.9
Borrower E	Real estate activities		15.9		8.9
Borrower F	Real estate activities		7.8		0.8
Borrower G	Human health and social work activities		7.4		3.9
Borrower H	Manufacturing		7.0		3.1
Borrower I	Manufacturing		6.8		3.9
Borrower J	Accommodation and food service activities		5.6		0.2
Borrower K	Manufacturing		5.3		3.2
Borrower L	Human health and social work activities		5.0		3.5
Borrower M	Wholesale and retail trade		4.4		1.5
Borrower N	Manufacturing		4.4		3.3
Borrower O	Membership organizations, repair and other personal services		4.1		1.0
Borrower P	Construction		4.0		3.1
Borrower Q	Accommodation and food service activities		3.8		0.2
Borrower R	Wholesale and retail trade		3.7		0.0
Borrower S	Real estate activities		3.7		0.2
Borrower T	Manufacturing		3.6		3.6

—	—		168.2		102.4

3.4.	Other Financial Information

See Exhibits 99.1 and 99.2 attached hereto for our consolidated and separate financial statements and relevant notes, which have been prepared in accordance with K-IFRS and reviewed by our independent auditors as stated in their review reports. The review reports will also be available on our website at www.kbfg.com.

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4.	Independent Public Accountants

4.1.	Audit / Review Services

(Unit: in millions of Won)

Period

Auditor

Activity

Agreed Per Contract(1)

Actual(2)

Compensation(3)

Estimated
Hours

Compensation(3)

Accrued
Hours

January 1 to June 30, 2023

Samil PricewaterhouseCoopers

Quarterly, semi-annual and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting)

1,264

11,675

614

3,079

January 1 to December 31, 2022

KPMG Samjong Accounting Corp.

Quarterly, semi-annual and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting)

1,291

11,364

1,291

11,028

January 1 to December 31, 2021

KPMG Samjong Accounting Corp.

Quarterly, semi-annual and annual review & audit, review of internal accounting management system (including audit of internal control over financial reporting)

1,261

11,364

1,261

11,451


Notes:	(1)	Total compensation and estimated hours are established at the time of the execution of the audit and review services contract.
	(2)	Actual compensation and hours are accrued from January 1 of each applicable year to the date of the audit or review report issued during such year.
	(3)	Excluding value-added taxes.

4.2.	Public Company Accounting Oversight Board (“PCAOB”) Audit Services


				(Unit: in millions of Won)
Period	Auditor	Activity	Service Period	Compensation(1)
January 1 to June 30, 2023	Samil Pricewaterhouse Coopers	PCAOB audit of consolidated financial statements and internal control over financial reporting	May 1, 2023 to April 30, 2024		784
January 1 to December 31, 2022	KPMG Samjong Accounting Corp.	PCAOB audit of consolidated financial statements and internal control over financial reporting	May 1, 2022 to April 30, 2023		697
January 1 to December 31, 2021	KPMG Samjong Accounting Corp.	PCAOB audit of consolidated financial statements and internal control over financial reporting	May 1, 2021 to April 30, 2022		681

Note:

(1) Total compensation (excluding value-added taxes) is established at the time of the execution of the audit and review services contract.

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4.3.	Change in Auditor

Pursuant to the Act on External Audit of Stock Companies and the related regulations thereunder, the Securities and Futures Commission under the Financial Services Commission had designated KPMG Samjong Accounting Corp. as the external auditor for the Company for the fiscal years ended December 31, 2020, 2021 and 2022. Following the end of KPMG Samjong Accounting Corp.’s designated period as the auditor, the Company selected Samil PricewaterhouseCoopers to be its new external auditor for the fiscal years ending December 31, 2023, 2024 and 2025, in accordance with the criteria and processes set forth by relevant laws and regulations. As such, the external auditor for the Company and its subsidiaries for the fiscal year ending December 31, 2023 is Samil PricewaterhouseCoopers.

5.	Corporate Governance and Affiliated Companies

5.1.	Board of Directors & Committees under the Board

As of June 30, 2023, our board of directors consisted of nine directors, comprising one executive director, one non-standing director and seven non-executive directors. The following committees currently serve under our board of directors:

•

Audit Committee;

•

Risk Management Committee;

•

Evaluation and Compensation Committee;

•

ESG Committee;

•

Non-Executive Director Nominating Committee;

•

CEO Nominating Committee;

•

Subsidiaries’ CEO Director Nominating Committee; and

•

Audit Committee Member Nominating Committee (ad hoc committee).

For the list of our directors, see 6. Directors, Senior Management and Employees — 6.1. Executive Directors, — 6.2. Non-standing Directors and — 6.3. Non-executive Directors below.

5.2.	Audit Committee

The Audit Committee oversees our financial reporting and approves the appointment of our independent auditors and internal compliance officers. The committee also reviews our financial information, auditor’s examinations, key financial statement issues, the plans and evaluation of internal controls and the administration of our financial affairs by the board of directors. In connection with the general meetings of shareholders, the committee examines the agenda for, and financial statements and other reports to be submitted by, the board of directors to each general meeting of shareholders. The committee holds regular meetings every quarter and on an as-needed basis.

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The following table shows a list of audit committee requirements under Articles 415-2 and 542-11 of the Commercial Act and how we fulfill each requirement as of June 30, 2023.


The Commercial Act Requirements		KB Financial Group
The Audit Committee must consist of three or more directors.		We have four Audit Committee members.

At least two-thirds of the Audit Committee members must be non-executive directors.		All four Audit Committee members, including the chairman of the committee, are non-executive directors.
The chairman of the Audit Committee must be a non-executive director.

At least one Audit Committee member must be an accounting or financial expert.		Two Audit Committee members (Whajoon Cho, Kyung Ho Kim) are accounting or financial experts.

5.3.	Compensation to Directors

5.3.1.

Total Amount of Compensation Approved at the Annual General Meeting of Shareholders

(Unit: in millions of Won)

Total number of persons(1)

Total compensation approved at shareholders’ meeting(2)

Notes

Registered Directors
(Non-executive directors)

9 (7)

3,000

—

Notes: (1)

Represents the total number of applicable persons as of June 30, 2023.

(2)

Represents the aggregate amount for all directors (including non-executive directors). Excludes compensation in the form of long-term performance-based stock grants.

5.3.2. Total Amount of Compensation Paid


(As of June 30, 2023)	(Unit: in millions of Won)
Total number of persons(1)	Total payment(2)(3)		Average payment per person(4)		Notes
9		972		108		—

Notes: (1)

Represents the total number of applicable persons as of June 30, 2023.

(2)

Represents the total amount paid (rounded to the nearest million) for the six months ended June 30, 2023.

(3)

Total payment amount in accordance with the Company’s internal policies on compensation to directors.

(4)

Represents (i) the total amount paid (rounded to the nearest million) for the six months ended June 30, 2023, divided by (ii) the number of applicable persons for the applicable reporting period.

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5.3.3. Compensation Breakdown


(As of June 30, 2023)					(Unit: in millions of Won)

	Total number of persons(1)		Total payment(2)(3)		Average payment per person(4)		Notes
Registered Directors (excluding non-executive directors and Audit Committee members)		2		645		323		—
Non-executive Directors (excluding Audit Committee members)		3		92		36		—
Audit Committee members		4		235		53		—
Internal Auditor		—		—		—		—

Notes: (1)

Represents the total number of applicable persons as of June 30, 2023.

(2)

Represents the total amount paid (rounded to the nearest million) for the six months ended June 30, 2023.

(3)

Total payment amount in accordance with the Company’s internal policies on compensation to directors.

(4)

Represents (i) the total amount paid (rounded to the nearest million) for the six months ended June 30, 2023, divided by (ii) the number of applicable persons for the applicable reporting period.

5.4.	Top 5 Highest-Paid Individuals

5.4.1

Compensation exceeding Won 500 million – Individual basis


(As of June 30, 2023)			(Unit: in millions of Won)

Name	Position	Total Amount	Deferred Compensation(1)
Jong Hee Yang	Vice Chairman	969	- Deferred short-term performance-based payment, the amount of which corresponds to a total of 4,792 shares and deferred long-term performance-based payment, the amount of which corresponds to a total of 6,557 shares.

Jong Kyoo Yoon	Chairman & CEO	645	- Deferred short-term performance-based payment, the amount of which corresponds to a total of 11,350 shares and deferred long-term performance-based payment, the amount of which corresponds to a total of 9,378 shares. - Long-term performance-based payment (22,712 shares per year), the amount of which will be finalized at a future date pursuant to a performance evaluation over a three-year period from November 21, 2020 to November 20, 2023.

Dong Whan Han	Senior Executive Vice President	555	- Deferred short-term performance-based payment, the amount of which corresponds to a total of 4,068 shares and deferred long-term performance-based payment, the amount of which corresponds to a total of 5,682 shares.

Note: (1)

The actual payment amount will be finalized based on the market value of our shares at the time of payment.

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5.4.2 Calculation criteria and method of compensation


Name	Compensation Type		Total Compensation (in millions of Won)	Calculation Criteria and Method
Jong Hee Yang	Earned income	Salary	230	- A monthly salary was paid in even installments each month in accordance with the amount of annual salary determined based on his position and responsibilities pursuant to our internal policy regarding executive officers. (This amount includes allowances for business expenses of Won 30 million.)

		Bonus	735	- The bonus paid in 2023 consisted of Won 234 million in short-term performance-based compensation pursuant to a performance evaluation for 2022 and Won 501 million in long-term performance-based compensation pursuant to a performance evaluation for 2021 and 2022. - The short-term performance evaluation index for 2022 consisted of financial results linked to his role as a Vice Chairman and as the head of the Group’s digital business and IT business, as well as non-financial results linked to certain management tasks. The amount of the short-term incentive payment was determined by the Evaluation and Compensation Committee, based on a comprehensive evaluation and is within the range of 0%-120% of his base salary. - With respect to the financial results for 2022, his major achievements included (i) the Group’s flagship digital platform exceeding 10 million monthly active users (MAU), and (ii) his efforts in strengthening the Group’s digital and IT competitiveness. - With respect to non-financial results, his major achievements included (i) enhancing the IT synergies within the Group, (ii) implementing data-based marketing by utilizing customer segments, and (iii) contributing to strengthening the competencies of the Group’s financial and non-financial platforms. - The long-term performance evaluation index consisted of a relative total shareholder return, as well as the performance results linked to his role as a Vice Chairman and as the head of Group’s digital business and IT business. The amount of the long-term incentive payment was determined by a comprehensive evaluation based on his achievements of each indexes and is within the range of 0%-100% of his base salary. - With respect to the financial results for long-term performance evaluation, the relative total shareholder return was calculated by measuring the increase in the Company’s share price relative to the average increase in the share price of competitors for each evaluation period, while the other items were calculated by averaging each year’s results.

		Stock options	—	- Not applicable
		Other earned income	4	- Welfare benefits
	Retirement income		—	- Not applicable
	Other income		—	- Not applicable

Jong Kyoo Yoon	Earned income	Salary	450	- A monthly salary was paid in even installments each month in accordance with the amount of annual salary determined by a resolution of the Evaluation and Compensation Committee within the limit of the total amount of compensation approved at the shareholders’ meeting. (This amount includes allowances for business expenses of Won 200 million.)

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Name	Compensation Type		Total Compensation (in millions of Won)	Calculation Criteria and Method

		Bonus	196	- The bonus paid in 2023 consisted of Won 196 million in short-term performance-based compensation paid as an upfront lump sum payment pursuant to a performance evaluation for 2022. - The short-term performance evaluation index for 2022 consisted of financial results (e.g., ROE, total operating income, net profit from non-banking businesses, comprehensive NPL ratio, RAROC, Tier 1 ratio, CIR), as well as non-financial results (e.g., improving the core competitiveness of the Group, expanding global and new businesses, innovating the financial platform, leading sustainable growth by enhancing asset quality, ESG and internal control, and cultivating an open and creative organizational structure). The amount of the short-term incentive payment is determined by the Evaluation and Compensation Committee based on the aggregate score of the index items above and is within the range of 0%-100% of the base salary. - With respect to financial results, the Group’s net profit for 2022 was Won 4,394.8 billion, primarily due to a solid growth in core earnings, and well-managed asset quality (e.g. comprehensive NPL ratio). Such results were considered, among others, to be major achievements reflected in the performance evaluation. - With respect to non-financial results, the major achievements considered included (i) strengthening the competencies of the Group’s core businesses and optimizing its business portfolio, (ii) enhancing the efficiency of the Group’s business line and optimizing its costs, and (iii) strengthening the competencies and market dominance of the Group’s non-banking operations and (iv) solidifying the Group’s position as a leading financial group in ESG management.

		Stock options	—	- Not applicable
		Other earned income	—	- Not applicable
	Retirement income		—	- Not applicable
	Other income		—	- Not applicable

Dong Whan Han	Earned income	Salary	130	- A monthly salary was paid in even installments each month in accordance with the amount of annual salary determined based on his position and responsibilities pursuant to our internal policy regarding executive officers.

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Name	Compensation Type		Total Compensation (in millions of Won)	Calculation Criteria and Method

		Bonus	415	- The bonus paid in 2023 consisted of Won 126 million in short-term performance-based compensation pursuant to a performance evaluation for 2022 and Won 290 million in long-term performance-based compensation pursuant to a performance evaluation for 2021 and 2022. - The short-term performance evaluation index for 2022 consisted of non-financial results linked his role as the Head of KB Research and certain management tasks. The amount of the short-term incentive payment was determined by the Evaluation and Compensation Committee, based on a comprehensive evaluation and is within the range of 0%-120% of his base salary. - With respect to non-financial results, his major achievements included (i) carrying out research tasks with the goal of securing core competencies of the Group and its subsidiaries, (ii) analyzing the global financial environment and the domestic and foreign macroeconomic environment, and (iii) swiftly sharing research reports within the Group to achieve our “One-Firm KB” goal and (iv) strengthening the role of the “Knowledge Hub”. - The long-term performance evaluation index consisted of a relative total shareholder return, as well as the performance results linked to his role as a Vice Chairman and as the head of Group’s digital business and IT business. The amount of the long-term incentive payment was determined by a comprehensive evaluation based on his achievements of each indices and is within the range of 0%-100% of his base salary. - With respect to the financial results for long-term performance evaluation, the relative total shareholder return was calculated by measuring the increase in the Company’s share price relative to the average increase in the share price of competitors for each evaluation period, while the other items were calculated by averaging each year’s results.
		Stock options	—	- Not applicable
		Other earned income	10	- Welfare benefits
	Retirement income		—	- Not applicable
	Other income		—	- Not applicable

5.5.	Affiliated Companies

5.5.1.

List of Affiliated Companies

Affiliated companies of KB Financial Group that are first-tier subsidiaries and KB Financial Group’s ownership of such companies as of June 30, 2023 are as follows.

Kookmin Bank (100.00%)

KB Securities Co., Ltd. (100.00%)

KB Insurance Co., Ltd. (100.00%)

KB Kookmin Card Co., Ltd. (100.00%)

KB Life Insurance Co., Ltd. (100.00%)

KB Asset Management Co., Ltd. (100.00%)

KB Capital Co., Ltd. (100.00%)

KB Real Estate Trust Co., Ltd. (100.00%)

KB Savings Bank Co., Ltd. (100.00%)

10)

KB Investment Co., Ltd. (100.00%)

11)

KB Data Systems Co., Ltd. (100.00%)

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6.	Directors, Senior Management and Employees

6.1.	Executive Directors

As of June 30, 2023, we had one executive director. The name, position and the end of the term of our executive director and the number of shares of our common stock he owned as of June 30, 2023 are set forth below.

Name

Date of Birth

Position

Common Shares Owned

End of Term

Jong Kyoo Yoon

October 1955

Chairman & Chief Executive Officer

21,000

November 20, 2023

6.2.	Non-standing Directors

As of June 30, 2023, we had one non-standing director. The name, position and the end of the term of our non-standing director and the number of shares of our common stock he owned as of June 30, 2023 are set forth below.

Name

Date of Birth

Position

Common Shares Owned

End of Term(1)

Jae Keun Lee

May 1966

Non-standing Director

1,119

March 24, 2024

Note: (1)

The date designated as Mr. Jae Keun Lee’s end of term is the date of the annual general meeting of shareholders for fiscal year 2023, which is expected be held in March 2024.

6.3.	Non-executive Directors

As of June 30, 2023, we had seven non-executive directors. The name, position and the end of the term of our non-executive directors and the number of shares of our common stock they respectively owned as of June 30, 2023 were as follows.


Name	Date of Birth	Position	Common Shares Owned		End of Term
Kyung Ho Kim	December 1954	Non-executive Director		—	March 23, 2024
Seon-joo Kwon	November 1956	Non-executive Director		—	March 24, 2024
Whajoon Cho	February 1957	Non-executive Director		—	March 23, 2025
Gyutaeg Oh	February 1959	Non-executive Director		—	March 23, 2024
Jungsung Yeo	April 1960	Non-executive Director		—	March 23, 2025
Jaehong Choi	August 1962	Non-executive Director		—	March 24, 2024
Sung-Yong Kim	March 1966	Non-executive Director		—	March 23, 2025

Table of Contents

6.4.	Senior Management

Members of our senior management as of June 30, 2023 are as follows.

Name

Date of Birth

Position

Common Shares
Owned(1)

End of Term

Jong Hee Yang

June 1961

Vice Chairman and Head of Retail Customer / Wealth Management & Pension / Small & Medium Enterprise Business Units

914

December 31, 2023

Yin Hur

December 1961

Vice Chairman and Head of Global / Insurance Business Units

13,506

December 31, 2023

Dong Cheol Lee

October 1961

Vice Chairman and Head of Digital / IT Business Units

3,325

December 31, 2023

Scott Y.H. Seo

March 1966

Senior Managing Director and Chief Finance Officer

—

December 31, 2023

Cheal Soo Choi

October 1966

Senior Executive Vice President and Chief Risk Management Officer

December 31, 2024

Dong Whan Han

January 1965

Senior Executive Vice President and Head of KB Research

1,100

December 31, 2023

Se Min Kim

January 1971

Senior Managing Director and Chief Strategy Officer

199

December 31, 2023

Bong Joong Kwon

November 1969

Senior Managing Director and Head of IR

1,286

December 31, 2023

Yeo Woon Yoon

April 1967

Senior Managing Director and Chief Human Resources Officer

609

December 31, 2023

Hye Ja Seo

September 1966

Senior Managing Director and Chief Compliance Officer

1,381

December 31, 2024

Jin Gyu Maeng

January 1966

Senior Managing Director and Head of Audit

1,079

December 31, 2023

Hye Sook Moon

September 1971

Managing Director and Head of ESG Division

652

December 31, 2023

Byung Joo Oh

January 1973

Managing Director, Insurance Business Unit

1,003

December 31, 2023

Jeong Rim Park

November 1963

Head of the Capital Market Business Unit

3,150

December 31, 2023

Sung Hyun Kim

August 1963

Head of Corporate and Investment Banking Business Unit

15,468

December 31, 2023

Hyun Seung Lee

November 1966

Head of Asset Management Business Unit

—

December 31, 2023

Jin Young Kim

August 1969

Chief Public Relations Officer

765

December 31, 2023

Mun Cheol Jeong

August 1968

Senior Executive Vice President, Retail Customer Business Unit

3,155

December 31, 2023

Jae Young Choi

June 1967

Senior Executive Vice President, Wealth Management and Pension Business Unit

1,012

December 31, 2023

Sung Ki Kwon

July 1966

Senior Executive Vice President, Small and Medium Enterprise Business Unit

586

December 31, 2023

Nam Hoon Cho

June 1968

Chief Global Strategy Officer

1,000

December 31, 2023

Young Suh Cho

February 1971

Chief Digital Platform Officer

1,000

December 31, 2023

Jin Soo Yoon

February 1964

Chief Information Technology Officer

437

December 31, 2023

Chang Hwa Yook

December 1967

Chief Data Officer

564

December 31, 2023

Sung Pyo Jeon

August 1966

Chief Customer Contact Officer

997

December 31, 2023

Jeong Ha

January 1967

Head of Capital Market Business Unit

—

December 31, 2023

Soon Bae Kang

August 1964

Head of Corporate and Investment Banking Business Unit

1,477

December 31, 2023

Nam Che Kang

August 1967

Head of Global Division

548

December 31, 2023

Yoon Ha

March 1971

Head of Customer Experience Design Center

—

December 31, 2023

Yoo Shim Hur

April 1973

Head of Digital Contents Center

—

December 31, 2023

Ki Eun Park

September 1970

Head of Tech Innovation Center

258

December 31, 2023

Joo Hyun Kim

November 1970

Head of Group Cloud Center

167

December 31, 2023

Soon Young Oh

August 1977

Head of Financial AI Center

—

December 31, 2023

Chan Yong Park

September 1965

Head of Office of Planning and Coordination

1,043

December 31, 2023

Min Hyuk Kang

January 1970

Head of Office of Capital Market Planning

722

December 31, 2023

Note: (1)

The number of common shares owned is as of June 30, 2023 and includes those owned in the holder’s name under the employee stock ownership association’s account, and may differ from the number of shares owned as reported pursuant to Article 173 of the Financial Investment Services and Capital Markets Act.

Table of Contents

As of June 30, 2023, the following management also served as senior management at our subsidiaries.


Name	Subsidiary	Position	Appointment Date
Jae Keun Lee	Kookmin Bank	Chief Executive Officer	January 2022
Jeong Rim Park	KB Securities	Chief Executive Officer	January 2019
Sung Hyun Kim	KB Securities	Chief Executive Officer	January 2019
Hyun Seung Lee	KB Asset Management	Chief Executive Officer	January 2018
Hye Sook Moon	Kookmin Bank	Head of ESG Division	January 2022
Jin Young Kim	Kookmin Bank	Senior Managing Director; Brand Strategy Group	January 2023
Mun Cheol Jeong	Kookmin Bank	Senior Executive Vice President; Retail Customer Group	January 2023
Jae Young Choi	Kookmin Bank	Senior Executive Vice President; Wealth Management Group	January 2023
	KB Securities	Senior Executive Vice President; Wealth Management Division	January 2022
	KB Insurance	Senior Executive Vice President; WM/Pension Division	January 2023
Sung Ki Kwon	Kookmin Bank	Senior Executive Vice President; SME and SOHO Customer Group	January 2023
Nam Hoon Cho	Kookmin Bank	Senior Managing Director; Global Business Group	January 2021
Young Suh Cho	Kookmin Bank	Senior Managing Director; DT Strategy Division	January 2021
Jin Soo Yoon	Kookmin Bank	Senior Executive Vice President; Tech Group	January 2021
Chang Hwa Yook	Kookmin Bank	Senior Managing Director; Data/AI Division	January 2023
Sungpyo Jeon	Kookmin Bank	Senior Managing Director; Smart Customer Group	January 2023
Jeong Ha	Kookmin Bank	Senior Executive Vice President; Capital Markets Group	January 2021
	KB Securities	Senior Executive Vice President; Sales and Trading Group	January 2023
Soon Bae Kang	Kookmin Bank	Senior Executive Vice President; Corporate Investment Banking Customer Group	January 2023
	KB Securities	Senior Executive Vice President; Investment Banking Group	January 2023
Nam Che Kang	Kookmin Bank	Head of Global Growth Supporting Division	January 2022
Yoon Ha	Kookmin Bank	Head of Customer Experience Design Center	January 2022
Yoo Shim Hur	Kookmin Bank	Managing Director; Digital Contents Center	January 2022
Ki Eun Park	Kookmin Bank	Senior Managing Director; Technology Innovation Division	July 2021
Joo Hyun Kim	Kookmin Bank	Head of Cloud Platform Department	February 2022
Soon Young Oh	Kookmin Bank	Managing Director; Financial AI Center	June 2022
Chan Yong Park	Kookmin Bank	Senior Managing Director; Planning & Coordination Department	January 2022
Min Hyuk Kang	Kookmin Bank	Head of Trading and Capital Markets Planning Department	January 2023
	KB Securities	Managing Director; Capital Markets Planning Department	January 2023
Se Min Kim	KB Securities	Non-standing Director	June 2022
	KB Life Insurance	Non-standing Director	August 2022
Scott Y.H. Seo	KB Insurance	Non-standing Director	February 2022
	KB Kookmin Card	Non-standing Director	March 2022

Table of Contents

6.5.

Employees

The following table shows information regarding our employees and compensation paid to them as of June 30, 2023.


						(Unit: in millions of Won)
Number of Employees(1)	Average Tenure of Employees(2)			Total Amount of Compensation(3)		Average Compensation per Person(4)
154		4 years and 2 months (16 years and 2 months	)		14,596		94

Notes:

(1) Includes all employees as of June 30, 2023, including executive officers.

(2)

The duration in parentheses includes tenure at our subsidiaries.

(3)

Based on the sum of all compensation paid from January 1, 2023 to June 30, 2023.

(4)

Based on the sum of the average monthly compensation of each month from January 1, 2023 to June 30, 2023, which is computed by dividing the sum of all compensation paid each month by the number of employees (including executive officers) at the end of each month.

The following table shows information regarding our executive officers and compensation paid to them as of June 30, 2023.


			(Unit: in millions of Won)
Number of Executive Officers(A)(1)	Total Amount of Annual Salaries(B)		Average Annual Salary per Person(B/A)
13		4,846		373

Note:

(1) Excludes 22 executive officers who served primarily as executive officers at our subsidiaries.

Table of Contents

7.	Major Shareholders and Related Party Transactions

7.1.	Major Shareholders

The following table presents information regarding holders of 5% or more of our total issued shares based on our shareholder registry as of June 30, 2023, unless specified otherwise.


			(Unit: shares, %)
Name	Number of Shares of Common Stock		Percentage of Total Issued Shares(1)
Korean National Pension Service		33,183,590		8.22
JP Morgan Chase Bank, N.A.(2)		25,715,570		6.37
BlackRock Fund Advisors(3)		25,050,939		6.02

Notes:

(1) Based on 403,511,072 shares of our common stock issued as of June 30, 2023.

(2)

Depositary under the Company’s ADR program. The voting rights are held by ADR holders.

(3)

The above number of shares and the percentage of total issued shares held by BlackRock Fund Advisors are as of February 26, 2021 and are based on disclosure made by BlackRock Fund Advisors in a statement of acquisition filing on March 10, 2021.

7.2.	Changes in the Largest Shareholder


						(Unit: shares, %)

Name of Largest Shareholder	Date of Change in Largest Shareholder/ Date of Change in Number of Shares Owned		Number of Shares of Common Stock(1)			Percentage of Total Issued Shares(2)
Korean National Pension Service		December 31, 2019		41,468,003			9.97
Korean National Pension Service		February 1, 2020		41,462,588	(3)		9.97
Korean National Pension Service		October 12, 2020		41,402,150			9.96
Korean National Pension Service		December 31, 2020		41,287,280			9.93
Korean National Pension Service		June 30, 2021		40,626,942			9.77
Korean National Pension Service		December 31, 2021		37,626,516			9.05
Korean National Pension Service		January 27, 2022		37,188,199	(4)		8.94
Korean National Pension Service		March 31, 2022		36,008,504			8.73
Korean National Pension Service		June 30, 2022		33,830,623			8.20
Korean National Pension Service		September 30, 2022		32,594,691			7.97
Korean National Pension Service		October 12, 2022		32,457,827	(5)		7.94
Korean National Pension Service		December 31, 2022		32,499,151			7.95
Korean National Pension Service		March 31, 2023		33,572,593			8.21
Korean National Pension Service		June 30, 2023		33,183,590			8.22

Notes:

(1) Based on our shareholder registry as of the end of each applicable year unless specified otherwise.

(2)

Total number of shares of common stock issued as of the following dates:

From October 19, 2016 to December 12, 2019: 418,111,537

From December 12, 2019 to February 14, 2022: 415,807,920

From February 14, 2022 to August 1, 2022: 412,352,494

From August 1, 2022 to April 4, 2023: 408,897,068

After April 4, 2023: 403,511,072

(3)

Based on disclosure made by the Korean National Pension Service in a statement of acquisition filing on February 7, 2020.

(4)

Based on disclosure made by the Korean National Pension Service in a statement of disposal filing on February 4, 2022.

(5)

Based on disclosure made by the Korean National Pension Service in a statement of disposal filing on November 2, 2022.

Table of Contents

7.3.	Employee Stock Ownership Association (As of June 30, 2023)


	(Unit: shares)
Company Name	Number of Shares of Common Stock Owned
KB Financial Group Inc.		65,947
Kookmin Bank		7,718,072
KB Securities Co., Ltd.		58,661
KB Insurance Co., Ltd.		597,580
KB Kookmin Card Co., Ltd.		549,942
KB Life Insurance Co., Ltd.		23,153
KB Asset Management Co., Ltd.		16,150
KB Capital Co., Ltd.		111,349
KB Real Estate Trust Co., Ltd.		23,926
KB Savings Bank Co., Ltd.		11,060
KB Investment Co., Ltd.		2,434
KB Data Systems Co., Ltd.		47,641
KB Credit Information Co., Ltd.		13,651
Others(1)		14,587

Total		9,254,153

Note:

(1) Shares of common stock attributable to an account owned by the employee stock ownership association of KB Financial Group.

7.4.	Investments in Affiliated Companies


(As of June 30, 2023)					(Units: shares, %, millions of Won)
Company Name	Ending Balance				Total assets as of the latest fiscal year		Net income(loss) for the latest fiscal year
Company Name		Number of shares owned	Ownership	Book value	Total assets as of the latest fiscal year		Net income(loss) for the latest fiscal year
Kookmin Bank		404,379,116	100	14,821,721		524,504,515		1,858,508
KB Securities Co., Ltd.		298,620,424	100	3,342,391		63,012,588		249,574
KB Insurance Co., Ltd.		66,500,000	100	2,375,430		35,349,569		525,218
KB Kookmin Card Co., Ltd.		92,000,000	100	1,953,175		29,255,854		192,855
KB Life Insurance Co., Ltd. (Formerly, Prudential Life Insurance)		16,201,518	100	2,795,368		30,074,809		122,743
KB Asset Management Co., Ltd.		7,667,550	100	96,312		316,187		31,583
KB Capital Co., Ltd.		32,175,147	100	873,811		16,018,070		105,360
KB Real Estate Trust Co., Ltd.		16,000,000	100	121,553		560,634		35,370
KB Savings Bank Co., Ltd.		8,001,912	100	176,813		2,950,374		(11,171	)
KB Investment Co., Ltd.		22,525,328	100	154,910		1,435,791		15,592
KB Data Systems Co., Ltd.		800,000	100	6,334		59,226		2,476

Total		—	—	26,717,818		—		—

Table of Contents

7.5.	Related Party Transactions

7.5.1.

Purchase of capital securities issued by KB Securities Co., Ltd.

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Securities Co., Ltd.

Subsidiary

No. 1 Private Placement of Capital Securities in Won

200

March 31, 2022

4.300

March 31, 2052

(may be extended)

Working capital

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Securities Co., Ltd.

Subsidiary

No. 3 Private Placement of Capital Securities in Won

230

September 30, 2022

5.500

September 30, 2052 (may be extended)

Working capital

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Securities Co., Ltd.

Subsidiary

No. 4 Private Placement of Capital Securities in Won

100

May 8, 2022

5.350

May 8, 2053

(may be extended)

Working capital

7.5.2.

Purchase of capital securities issued by KB Capital Co., Ltd.

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Capital Co., Ltd.

Subsidiary

No. 299 Private Placement of Capital Securities in Won

March 27, 2015

6.548

%(1)

March 27, 2045

(may be extended)

Working capital

Note: (1)

The interest rate has increased from its initial rate due to the non-exercise of the call option.

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Capital Co., Ltd..

Subsidiary

No. 320 Private Placement of Capital Securities in Won

September 24, 2015

5.989

%(1)

September 24, 2045

(may be extended)

Working capital

Note: (1)

The interest rate has increased from its initial rate due to the non-exercise of the call option.

Table of Contents

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Capital Co., Ltd.

Subsidiary

No. 343 Private Placement of Capital Securities in Won

March 29, 2016

6.305

%(1)

March 29, 2046

(may be extended)

Working capital

Note: (1)

The interest rate has increased from its initial rate due to the non-exercise of the call option.

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Capital Co., Ltd.

Subsidiary

No. 352 Private Placement of Capital Securities in Won

June 28, 2016

6.466

%(1)

June 28, 2046

(may be extended)

Working capital

Note: (1)

The interest rate has increased from its initial rate due to the non-exercise of the call option.

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Capital Co., Ltd.

Subsidiary

No. 367 Private Placement of Capital Securities in Won

November 28, 2016

6.952

%(1)

November 28, 2046

(may be extended)

Working capital

Note: (1)

The interest rate has increased from its initial rate due to the non-exercise of the call option.

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Capital Co., Ltd.

Subsidiary

No. 378 Private Placement of Capital Securities in Won

April 27, 2017

7.664

%(1)

April 27, 2047

(may be extended)

Working capital

Note: (1)

The interest rate has increased from its initial rate due to the non-exercise of the call option

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Capital Co., Ltd.

Subsidiary

No. 460 Private Placement of Capital Securities in Won

100

September 25, 2020

3.376

September 25, 2050 (may be extended)

Working capital

Table of Contents

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Capital Co., Ltd.

Subsidiary

No. 486 Private Placement of Capital Securities in Won

100

February 17, 2022

4.495

February 17, 2052

(may be extended)

Working capital

7.5.3.

Purchase of subordinated bonds issued by KB Savings Bank Co., Ltd.

(Unit: in billions of Won)

Issuer

Relationship

Type

Issue Amount

Issue Date

Interest Rate

Maturity Date

Use of Proceeds

KB Savings Bank Co., Ltd.

Subsidiary

No. 1 Subordinated Bonds in Won

June 25, 2021

1.600

June 25, 2031

Working capital

7.5.4.

Prepayments and Loans to Subsidiaries

(Unit: in billions of Won)

Name

Relationship

Account

Loan Amount

Current Balance

Credit Offering
Date

Interest Rate

Maturity Date

KB Investment Co., Ltd.

Subsidiary

Loans(1)

July 14, 2017

2.571%(2)

July 12, 2023

Notes: (1) Unsecured credit loans.

(2)

Changed from 2.239% to 2.571% upon extension of the loans on July 12, 2022.

(Unit: in billions of Won)

Name

Relationship

Account

Loan Amount

Current Balance

Credit Offering
Date

Interest Rate

Maturity Date

KB Investment Co., Ltd.

Subsidiary

Loans(1)

July 13, 2018

2.571%(2)

July 12, 2023

Notes: (1) Unsecured credit loans.

(2)

Changed from 2.239% to 2.571% upon extension of the loans on July 12, 2022.

(Unit: in billions of Won)

Name

Relationship

Account

Loan Amount

Current Balance

Credit Offering
Date

Interest Rate

Maturity Date

KB Investment Co., Ltd.

Subsidiary

Loans(1)

March 8, 2019

2.630%(2)

March 8, 2024

Notes: (1) Unsecured credit loans.

(2)

Changed from 2.334% to 2.630% upon extension of the loans on March 9, 2023.

Table of Contents

(Unit: in billions of Won)

Name

Relationship

Account

Loan
Amount

Current

Balance

Credit Offering Date

Interest
Rate

Maturity Date

KB Investment Co., Ltd.

Subsidiary

Loans(1)

March 9, 2020

2.630%(2)

March 8, 2024


Notes:	(1)	Unsecured credit loans.
	(2)	Changed from 2.334% to 2.630% upon extension of the loans on March 9, 2023.

(Unit: in billions of Won)

Name

Relationship

Account

Loan
Amount

Current

Balance

Credit Offering Date

Interest
Rate

Maturity Date

KB Investment Co., Ltd.

Subsidiary

Loans(1)

July 13, 2020

2.571%(2)

July 12, 2023


Notes:	(1)	Unsecured credit loans.
	(2)	Changed from 2.239% to 2.571% upon extension of the loans on July 12, 2022.

(Unit: in billions of Won)

Name

Relationship

Account

Loan
Amount

Current Balance

Credit Offering Date

Interest
Rate

Maturity Date

KB Investment Co., Ltd.

Subsidiary

Loans(1)

December 20, 2021

2.590%

December 19, 2023


Notes:	(1)	Unsecured credit loans.
	(2)	Changed from 2.247% to 2.590% upon extension of the loans on December 19, 2022.

(Unit: in billions of Won)

Name

Relationship

Account

Loan
Amount

Current Balance

Credit Offering Date

Interest
Rate

Maturity Date

KB Investment Co., Ltd.

Subsidiary

Loans(1)

July 13, 2022

2.571%

July 12, 2023

Note: (1)

Unsecured credit loans.

(Unit: in billions of Won)

Name

Relationship

Account

Loan
Amount

Current Balance

Credit Offering
Date

Interest
Rate

Maturity Date

KB Credit Information Co., Ltd.

Subsidiary

Loans(1)

October 7, 2022

2.401%

October 6, 2023

Note: (1)

Unsecured credit loans.

(Unit: in billions of Won)

Name

Relationship

Account

Loan
Amount

Current Balance

Credit Offering Date

Interest
Rate

Maturity Date

KB Credit Information Co., Ltd.

Subsidiary

Loans(1)

6.5

December 9, 2022

2.399%

October 6, 2023

Note: (1)

Unsecured credit loans.

Table of Contents

(Unit: in billions of Won)

Name

Relationship

Account

Loan
Amount

Current Balance

Credit Offering Date

Interest
Rate

Maturity Date

KB Capital Co., Ltd.

Subsidiary

Loans(1)

200

November 25, 2022

2.401%

November 24, 2023

Note: (1)

Unsecured credit loans.

Table of Contents

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: August 14, 2023	By:	/s/ Scott Y. H. Seo
	(Signature)
	Name: Scott Y. H. Seo
	Title:	Senior Executive Vice President and Chief Finance Officer

EX-99.1 2 d492931dex991.htm EX-99.1 EX-99.1 Table of Contents

Exhibit 99.1

KB Financial Group Inc. and Subsidiaries

Consolidated Interim Financial Statements

June 30, 2023 and 2022

(Unaudited)

Table of Contents

KB Financial Group Inc. and Subsidiaries


	Page(s)
Report on Review of Condensed Consolidated Interim Financial Statements		1 - 2

Consolidated Interim Financial Statements

Consolidated Interim Statements of Financial Position		3

Consolidated Interim Statements of Comprehensive Income		4-5

Consolidated Interim Statements of Changes in Equity		6

Consolidated Interim Statements of Cash Flows		7 - 8

Notes to the Consolidated Interim Financial Statements		9

Table of Contents

Report on Review of Condensed Consolidated Interim Financial Statements

(English Translation of a Report Originally Issued in Korean)

To the Shareholders and the Board of Directors of

KB Financial Group Inc.

Reviewed Financial Statements

We have reviewed the accompanying condensed consolidated interim financial statements of KB Financial Group Inc. and its subsidiaries (collectively referred to as the “Group”). These condensed consolidated interim financial statements consist of the consolidated interim statement of financial position of the Group as at June 30, 2023, and the related consolidated interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2023, and consolidated interim statements of changes in equity and cash flows for the six-month period ended June 30, 2023, and a summary of material accounting policies and other selected explanatory notes, expressed in Korean won.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and presentation of these condensed consolidated interim financial statements in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (Korean IFRS) 1034 Interim Financial Reporting, and for such internal control as management determines is necessary to enable the preparation of condensed consolidated interim financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on these condensed consolidated interim financial statements based on our review.

We conducted our review in accordance with quarterly or semi-annual review standards established by the Securities and Futures Commission of the Republic of Korea. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Korean Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe the accompanying condensed consolidated interim financial statements are not prepared, in all material respects, in accordance with Korean IFRS 1034 Interim Financial Reporting.

Table of Contents

Other Matters

The consolidated interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2022, changes in equity and cash flows for the six-month period ended June 30, 2022 were reviewed by another auditor who expressed their review conclusion that nothing has come to their attention that causes them to believe the condensed consolidated interim financial statements do not present fairly, in all material respects, in accordance with Korean IFRS 1034 Interim Financial Reporting. These condensed consolidated interim financial statements that another auditor had reviewed have not reflected the adjustments described in Note 2 of the accompanying condensed consolidated interim financial statements. The accompanying comparative consolidated interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2022, changes in equity, and cash flows for the six-month period ended June 30, 2022, reflected the adjustments.

The consolidated statement of financial position as of December 31, 2022, and the consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, not presented herein, were audited by another auditor who expressed an unqualified opinion on those statements on March 7, 2023. The consolidated financial statements that another auditor expressed an unqualified opinion were prepared before the adjustments described in Note 2 of Korean IFRS 1117 Insurance Contract. The consolidated statement of financial position as of December 31, 2022, presented herein for comparative purposes, has been restated to reflect the adjustments described in Note 2.

Review standards and their application in practice vary among countries. The procedures and practices used in the Republic of Korea to review such financial statements may differ from those generally accepted and applied in other countries.

/s/ Samil PricewaterhouseCoopers

Seoul, Korea

August 14, 2023

This report is effective as of August 14, 2023, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying condensed consolidated interim financial statements and notes thereto. Accordingly, the readers of the review report should understand that there is a possibility that the above review report may have to be revised to reflect the impact of such subsequent events or circumstances, if any.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Consolidated Interim Statements of Financial Position

June 30, 2023 and December 31, 2022

(in millions of Korean won)


	Notes		June 30, 2023 (Unaudited)			December 31, 2022
Assets
Cash and due from financial institutions		4,6,7,31		31,610,850			32,474,750
Financial assets at fair value through profit or loss		4,6,11		74,604,619			70,092,497
Derivative financial assets		4,6,8		8,195,304			9,446,580
Loans measured at amortized cost		4,6,9,10		434,953,555			433,038,931
Financial investments		4,6,11		116,969,558			115,452,659
Investments in associates and joint ventures		12		666,893			682,670
Insurance contract assets		30		189,214			83,304
Reinsurance contract assets		30		1,529,427			1,495,966
Property and equipment				4,956,129			4,991,467
Investment property				3,505,583			3,148,340
Intangible assets				1,956,545			1,858,470
Net defined benefit assets		19		468,642			478,934
Current income tax assets				242,981			204,690
Deferred income tax assets		13,26		271,776			188,372
Assets held for sale				228,811			211,758
Other assets		4,6		25,967,859			14,815,438

Total assets				706,317,746			688,664,826

Liabilities
Financial liabilities at fair value through profit or loss		4,6,14		12,044,419			12,271,604
Derivative financial liabilities		4,6,8		7,999,757			9,509,769
Deposits		4,6,15		396,081,606			393,928,904
Borrowings		4,6,16		69,261,997			71,717,366
Debentures		4,6,17		68,260,644			68,698,203
Insurance contract liabilities		30		46,840,867			45,920,012
Reinsurance contract liabilities		30		33,791			31,728
Provisions		18		978,309			933,701
Net defined benefit liabilities		19		112,351			85,745
Current income tax liabilities				507,874			998,681
Deferred income tax liabilities		13,26		2,044,588			1,574,954
Other liabilities		4,6		44,446,638			28,849,911

Total liabilities				648,612,841			634,520,578

Equity
Share capital				2,090,558			2,090,558
Hybrid securities				5,032,803			4,434,251
Capital surplus				16,649,233			16,940,731
Accumulated other comprehensive income		28		1,910,088			1,312,522
Retained earnings				30,853,620			28,922,272
Treasury shares				(865,837	)		(836,188	)

Equity attributable to shareholders of the Parent Company		20		55,670,465			52,864,146
Non-controlling interests				2,034,440			1,280,102

Total equity				57,704,905			54,144,248

Total liabilities and equity				706,317,746			688,664,826

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

Table of Contents

KB Financial Group Inc. and Subsidiaries

Consolidated Interim Statements of Comprehensive Income

Three-Month and Six-Month Periods Ended June 30, 2023 and 2022

(in millions of Korean won, except per share amounts)


	Notes	2023 (Unaudited)						2022 (Unaudited)
		Three months			Six months			Three months			Six months
Interest income			7,130,660			13,997,243			4,693,448			8,999,760
Interest income from financial instruments at fair value through other comprehensive income and amortized cost			6,783,763			13,311,319			4,481,783			8,594,390
Interest income from financial instruments at fair value through profit or loss			341,149			674,626			207,412			396,149
Insurance finance interest income			5,748			11,298			4,253			9,221
Interest expense			(4,156,990	)		(8,237,980	)		(1,872,196	)		(3,526,997	)
Interest expense			(3,728,417	)		(7,368,296	)		(1,480,453	)		(2,751,154	)
Insurance finance interest expense			(428,573	)		(869,684	)		(391,743	)		(775,843	)

Net interest income	5,21		2,973,670			5,759,263			2,821,252			5,472,763

Fee and commission income			1,361,714			2,696,416			1,315,304			2,650,233
Fee and commission expense			(410,310	)		(831,006	)		(380,748	)		(758,421	)

Net fee and commission income	5,22		951,404			1,865,410			934,556			1,891,812

Insurance income			2,675,387			5,337,499			2,436,539			4,784,118
Insurance income			2,564,452			5,061,978			2,359,648			4,641,295
Reinsurance income			110,935			275,521			76,891			142,823
Insurance expense			(2,243,913	)		(4,525,378	)		(2,016,844	)		(3,968,547	)
Insurance service expense			(2,036,905	)		(4,120,869	)		(1,824,212	)		(3,613,984	)
Reinsurance expense			(207,008	)		(404,509	)		(192,632	)		(354,563	)

Net insurance income	5,30		431,474			812,121			419,695			815,571

Net gains (losses) on financial instruments at fair value through profit or loss	5,23		385,907			1,159,314			(873,267	)		(1,198,796	)

Other insurance finance income	30		12,881			(221,149	)		380,923			655,752

Net other operating expenses	5,24		(458,084	)		(718,208	)		(337,849	)		(754,156	)

General and administrative expenses	5,19,25		(1,592,942	)		(3,159,228	)		(1,552,854	)		(3,034,232	)

Operating income before provision for credit losses	5		2,704,310			5,497,523			1,792,456			3,848,714

Provision for credit losses	5,7,9,10,18		(651,297	)		(1,319,485	)		(329,694	)		(475,543	)

Net operating income	5		2,053,013			4,178,038			1,462,762			3,373,171

Share of profit (loss) of investments in associates and joint ventures	5		6,945			4,449			(27,991	)		(19,859	)
Net other non-operating income (expenses)	5		(99,298	)		(192,963	)		220,643			221,787

Net non-operating income (expenses)			(92,353	)		(188,514	)		192,652			201,928

Profit before income tax expense	5		1,960,660			3,989,524			1,655,414			3,575,099

Income tax expense	5,26		(455,889	)		(985,539	)		(440,928	)		(889,079	)

Profit for the period	5		1,504,771			3,003,985			1,214,486			2,686,020

(Continued)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Consolidated Interim Statements of Comprehensive Income

Three-Month and Six-Month Periods Ended June 30, 2023 and 2022 (cont'd)

(in millions of Korean won, except per share amounts)


	Notes		2023 (Unaudited)						2022 (Unaudited)
			Three months			Six months			Three months			Six months
Items that will not be reclassified to profit or loss:
Remeasurements of net defined benefit liabilities				4,112			9,940			(21,027	)		(31,712	)
Share of other comprehensive loss of associates and joint ventures				—			(2	)		(2	)		(2	)
Gains (losses) on equity securities at fair value through other comprehensive income				(13,261	)		(13,371	)		(499,498	)		(717,299	)
Fair value changes of financial liabilities designated at fair value through profit or loss due to own credit risk				(610	)		(50,585	)		8,048			7,234

				(9,759	)		(54,018	)		(512,479	)		(741,779	)

Items that may be reclassified subsequently to profit or loss:
Currency translation differences				(23,861	)		91,958			181,849			265,794
Losses on debt securities at fair value through other comprehensive income				(698,933	)		826,524			(2,341,694	)		(4,673,299	)
Share of other comprehensive income (loss) of associates and joint ventures				2,977			(1,181	)		(54	)		23
Gains (losses) on cash flow hedging instruments		8		21,233			(14,232	)		(6,765	)		21,231
Gains (losses) on hedging instruments of net investments in foreign operations		8		(9,263	)		(39,396	)		(71,817	)		(95,983	)
Insurance finance income(expense)		30		865,039			(176,014	)		2,429,526			5,115,611

				157,192			687,659			191,045			633,377

Other comprehensive income (loss) for the period, net of tax				147,433			633,641			(321,434	)		(108,402	)

Total comprehensive income (loss) for the period				1,652,204			3,637,626			893,052			2,577,618

Profit attributable to:		5
Shareholders of the Parent Company				1,499,056			2,996,687			1,209,951			2,670,523
Non-controlling interests				5,715			7,298			4,535			15,497

				1,504,771			3,003,985			1,214,486			2,686,020

Total comprehensive income (loss) for the period attributable to:
Shareholders of the Parent Company				1,648,002			3,620,720			881,276			2,546,532
Non-controlling interests				4,202			16,906			11,776			31,086

				1,652,204			3,637,626			893,052			2,577,618

Earnings per share (in Korean won)		29
Basic earnings per share				3,776			7,530			3,032			6,723
Diluted earnings per share				3,694			7,360			2,967			6,572

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

Table of Contents

KB Financial Group Inc. and Subsidiaries

Consolidated Interim Statements of Changes in Equity

Six-Month Periods Ended June 30, 2023 and 2022

(in millions of Korean won)


	Equity attributable to shareholders of the Parent Company
	Share capital		Hybrid securities		Capital surplus			Accumulated other comprehensive income			Accumulated other comprehensive income relating to assets of a disposal group held for sale			Retained earnings			Treasury shares			Non- controlling interests			Total equity
Balance as of January 1, 2022		2,090,558		2,838,221		16,940,231			1,047,274			7,671			25,672,815			(1,136,188	)		833,338			48,293,920

Changes in accounting policies		—		—		—			367,477			—			748,903			—			—			1,116,380
Balance as of January 1, 2022 (After the restatement)		2,090,558		2,838,221		16,940,231			1,414,751			7,671			26,421,718			(1,136,188	)		833,338			49,410,300
Comprehensive income for the period
Profit for the period		—		—		—			—			—			2,670,523			—			15,497			2,686,020
Remeasurements of net defined benefit liabilities		—		—		—			(32,132	)		—			—			—			420			(31,712	)
Currency translation differences		—		—		—			256,944			(7,671	)		—			—			16,521			265,794
Gains (losses) on financial instruments at fair value through other comprehensive income and transfer to retained earnings		—		—		—			(5,388,959	)		—			(287	)		—			(1,352	)		(5,390,598	)
Share of other comprehensive income of associates and joint ventures		—		—		—			21			—			—			—			—			21
Gains on cash flow hedging instruments		—		—		—			21,231			—			—			—			—			21,231
Losses on hedging instruments of net investments in foreign operations		—		—		—			(95,983	)		—			—			—			—			(95,983	)
Insurance finance income		—		—		—			5,115,611			—			—			—			—			5,115,611
Fair value changes of financial liabilities designated at fair value through profit or loss due to own credit risk		—		—		—			7,234			—			—			—			—			7,234

Total comprehensive income for the period		—		—		—			(116,033	)		(7,671	)		2,670,236			—			31,086			2,577,618

Transactions with shareholders
Annual dividends paid to shareholders of the Parent Company		—		—		—			—			—			(853,299	)		—			—			(853,299	)
Quarterly dividends paid to shareholders of the Parent Company		—		—		—			—			—			(194,817	)		—			—			(194,817	)
Issuance of hybrid securities		—		1,097,331		—			—			—			—			—			414,094			1,511,425
Dividends on hybrid securities		—		—		—			—			—			(51,184	)		—			(12,950	)		(64,134	)
Retirement of treasury shares		—		—		—			—			—			(150,000	)		150,000			—			—
Others		—		—		500			—			—			—			—			25,372			25,872

Total transactions with shareholders		—		1,097,331		500			—			—			(1,249,300	)		150,000			426,516			425,047

Balance as of June 30, 2022 (Unaudited)		2,090,558		3,935,552		16,940,731			1,298,718			—			27,842,654			(986,188	)		1,290,940			52,412,965

Balance as of January 1, 2023		2,090,558		4,434,251		16,940,731			1,312,521			—			28,922,273			(836,188	)		1,280,102			54,144,248

Comprehensive income for the period
Profit for the period		—		—		—			—			—			2,996,687			—			7,298			3,003,985
Remeasurements of net defined benefit liabilities		—		—		—			9,172			—			—			—			768			9,940
Currency translation differences		—		—		—			84,118			—			—			—			7,840			91,958
Losses on financial instruments at fair value through other comprehensive income and transfer to retained earnings		—		—		—			785,687			—			26,466			—			1,000			813,153
Share of other comprehensive income of associates and joint ventures		—		—		—			(1,183	)		—			—			—			—			(1,183	)
Gains on cash flow hedging instruments		—		—		—			(14,232	)		—			—			—			—			(14,232	)
Losses on hedging instruments of net investments in foreign operations		—		—		—			(39,396	)		—			—			—			—			(39,396	)
Insurance finance income		—		—		—			(176,014	)		—			—			—			—			(176,014	)
Fair value changes of financial liabilities designated at fair value through profit or loss due to own credit risk		—		—		—			(50,585	)		—			—			—			—			(50,585	)

Total comprehensive income for the period		—		—		—			597,567			—			3,023,153			—			16,906			3,637,626

Transactions with shareholders
Annual dividends paid to shareholders of the Parent Company		—		—		—			—			—			(564,970	)		—			—			(564,970	)
Quarterly dividends paid to shareholders of the Parent Company		—		—		—			—			—			(195,967	)		—			—			(195,967	)
Issuance of hybrid securities		—		598,552		—			—			—			—			—			429,080			1,027,632
Dividends on hybrid securities		—		—		—			—			—			(88,773	)		—			(25,921	)		(114,694	)
Acquisition of treasury shares															—			(271,745	)					(271,745	)
Retirement of treasury shares		—		—		—			—			—			(242,096	)		242,096			—			—
Others		—		—		(291,498	)		—			—			—			—			334,273			42,775

Total transactions with shareholders		—		598,552		(291,498	)		—			—			(1,091,806	)		(29,649	)		737,432			(76,969	)

Balance as of June 30, 2023 (Unauidted)		2,090,558		5,032,803		16,649,233			1,910,088			—			30,853,620			(865,837	)		2,034,440			57,704,905

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

Table of Contents

KB Financial Group Inc. and Subsidiaries

Consolidated Interim Statements of Cash Flows

Six-Month Periods Ended June 30, 2023 and 2022

(in millions of Korean won)


	Notes	2023 (Unaudited)			2022 (Unaudited)
Cash flows from operating activities
Profit for the period			3,003,985			2,686,020

Adjustment for non-cash items
Net losses (gains) on financial assets at fair value through profit or loss			(654,528	)		986,866
Net losses on derivative financial instruments for hedging purposes			39,796			147,532
Provision for credit losses			1,319,485			475,543
Net losses (gains) on financial investments			58,854			84,758
Share of loss (profit) of associates and joint ventures			(4,449	)		19,859
Depreciation and amortization expense			416,864			386,944
Other net losses (gains) on property and equipment/intangible assets			129,461			(254,470	)
Share-based payments			26,668			23,180
Provision for policy reserves			—			(442	)
Post-employment benefits			75,878			109,313
Net interest income			(23,093	)		49,732
Losses (gains) on foreign currency translation			(75,977	)		(391,409	)
Insurance finance income			(4,435,110	)		(5,018,994	)
Reinsurance finance expense			609,189			580,225
Other expenses			382,765			389,942

			(2,134,197	)		(2,411,421	)

Changes in operating assets and liabilities
Financial asset at fair value through profit or loss			(5,031,753	)		3,562,503
Derivative financial instruments			(179,662	)		483,560
Loans measured at fair value through other comprehensive income			(142,471	)		(88,926	)
Loans measured at amortized cost			(2,679,952	)		(16,582,344	)
Current income tax assets			(38,291	)		(107,769	)
Deferred income tax assets			(81,486	)		57,043
Other assets			(10,127,577	)		(7,424,202	)
Financial liabilities at fair value through profit or loss			(701,456	)		1,599,230
Deposits			1,225,865			2,705,696
Current income tax liabilities			(490,808	)		269,465
Deferred income tax liabilities			269,162			(214,236	)
Other liabilities			15,705,524			7,225,411
Insurance contract assets			(105,909	)		(46,365	)
Reinsurance contract assets			(639,700	)		(437,262	)
Insurance contract liabilities			5,086,743			5,210,659
Reinsurance contract liabilities			20,335			(56,151	)

			2,088,564			(3,843,688	)

Net cash outflow from operating activities			2,958,352			(3,569,089	)

(Continued)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Consolidated Interim Statements of Cash Flows

Six-Month Periods Ended June 30, 2023 and 2022 (cont'd)

(in millions of Korean won)


	Notes		2023 (Unaudited)			2022 (Unaudited)
Cash flows from investing activities
Net cash flows from derivative financial instruments for
hedging purposes				(42,853	)		(51,071	)
Disposal of financial asset at fair value through profit or loss				6,292,046			3,059,578
Acquisition of financial asset at fair value through profit or loss				(4,933,456	)		(6,951,325	)
Disposal of financial investments				24,548,005			9,738,698
Acquisition of financial investments				(23,848,677	)		(15,055,290	)
Disposal of investments in associates and joint ventures				45,219			77,089
Acquisition of investments in associates and joint ventures				(26,592	)		(171,483	)
Disposal of property and equipment				2,175			12,311
Acquisition of property and equipment				(105,557	)		(90,851	)
Acquisition of investment property				(122,749	)		(400	)
Disposal of intangible assets				388			3,672
Acquisition of intangible assets				(184,574	)		(77,629	)
Net cash flows from changes in ownership of subsidiaries				470,172			411,985
Others				(368,531	)		763,822

Net cash outflow from investing activities				1,725,016			(8,330,894	)

Cash flows from financing activities
Net cash flows from derivative financial instruments for
hedging purposes				(17,200	)		11,980
Net Increase (decrease) in borrowings				(2,760,981	)		8,751,889
Increase in debentures				25,904,214			33,998,941
Decrease in debentures				(27,163,902	)		(30,971,862	)
Decrease in other payables to trust accounts				(129,072	)		(527,367	)
Dividends paid				(760,936	)		(1,048,116	)
Issuance of hybrid securities				598,552			1,097,331
Dividends paid on hybrid securities				(88,773	)		(51,184	)
Acquisition of treasury shares				(271,745	)		—
Redemption of principal elements of lease payments				(127,528	)		(135,249	)
Increase in non-controlling interests				403,159			401,144
Others				(286,774	)		514,637

Net cash inflow from financing activities				(4,700,986	)		12,042,144

Effect of exchange rate changes on cash and cash equivalents				39,704			183,350

Net decrease in cash and cash equivalents				22,086			325,511
Cash and cash equivalents at the beginning of the period		31		26,534,798			26,033,162

Cash and cash equivalents at the end of the period		31		26,556,884			26,358,673

The above consolidated interim statements of cash flows should be read in conjunction with the accompanying notes Notes to the Consolidated Interim Financial Statements

Table of Contents

KB Financial Group Inc. and Subsidiaries

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

1. The Parent Company

KB Financial Group Inc. (the “Parent Company”) was incorporated on September 29, 2008, under the Financial Holding Companies Act of Korea. KB Financial Group Inc. and its subsidiaries (the “Group”) derive substantially all of their revenue and income from providing a broad range of banking and related financial services to consumers and corporations. The Parent Company’s main business purpose is to control subsidiaries that engage in the financial business or subsidiaries closely related to the financial business through the stock ownership. The Parent Company’s headquarter is located at 26, Gukjegeumyung-ro 8-gil, Yeongdeungpo-gu, Seoul. In 2011, Kookmin Bank spun off its credit card business segment and established a new separate credit card company, KB Kookmin Card Co., Ltd. and KB Investment & Securities Co., Ltd. merged with KB Futures Co., Ltd. The Group established KB Savings Bank Co., Ltd. in January 2012, acquired Yehansoul Savings Bank Co., Ltd. in September 2013, and KB Savings Bank Co., Ltd. merged with Yehansoul Savings Bank Co., Ltd. in January 2014. In March 2014, the Group acquired Woori Financial Co., Ltd. and changed the name to KB Capital Co., Ltd. Meanwhile, the Group included LIG Insurance Co., Ltd. as an associate and changed the name to KB Insurance Co., Ltd. in June 2015, and KB Insurance Co., Ltd. became one of the subsidiaries through a tender offer in May 2017. Also, the Group included Hyundai Securities Co., Ltd. as an associate in June 2016 and included as a subsidiary in October 2016 by comprehensive exchange of shares. Hyundai Securities Co., Ltd. merged with KB Investment & Securities Co., Ltd. in December 2016 and changed its name to KB Securities Co., Ltd. in January 2017. In August 2020, the Group acquired Prudential Life Insurance Company of Korea Ltd. which was classified as a subsidiary and the name was changed to KB Life Insurance Co., Ltd. in December 2022. Then in January 2023, it merged with another existing KB Life Insurance Co., Ltd. The Parent Company sold 100% shares of KB Credit Information Co., Ltd. to KB Kookmin Card Co., Ltd. on June 30, 2023.

The Parent Company’s share capital as of June 30, 2023, is 2,090,558 million. The Parent Company has been listed on the Korea Exchange (“KRX”) since October 10, 2008, and on the New York Stock Exchange (“NYSE”) for its American Depositary Shares (“ADS”) since September 29, 2008. Number of shares authorized in its Articles of Incorporation is 1,000 million.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2. Basis of Preparation

2.1 Application of Korean IFRS

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.

The Group’s condensed consolidated interim financial statements for the six-month period ended June 30, 2023, have been prepared in accordance with Korean IFRS No.1034 Interim Financial Reporting and contain less information than is required in annual consolidated financial statements. Selected explanatory notes include descriptions of transactions or events that are significant in understanding change in financial position and financial performance of the Group since the end of the previous annual reporting period. These condensed consolidated interim financial statements have been prepared in accordance with Korean IFRS which is effective or early adopted as of June 30, 2023.

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023.

•

Amendments to Korean IFRS No.1117 Insurance Contract

2.1.1.1 Major Accounting Policy Changes

Korean IFRS No.1117, ‘Insurance Contracts’, which replaces Korean IFRS No.1104, ‘Insurance Contracts’, is effective for fiscal years beginning on or after January 1, 2023. The main features of Korean IFRS No.1117 are the measurement of current value of insurance liabilities, recognition of insurance revenue on an accrual basis, and separation of investment components from host insurance contract. In other words, according to Korean IFRS No.1104, insurance liabilities are measured using past information (interest rates at the time of insurance sales, etc.), and when the company receives premiums, the premiums received are recognized as insurance revenue on a cash basis. On the other hand, according to Korean IFRS No.1117, insurance liabilities are measured at current value using a discount rate that reflects assumptions and risks at the present time (reporting time), and insurance revenue reflects services provided by insurance companies to policyholders for each fiscal year. Therefore, revenue is recognized on an accrual basis, and investment components are separated from host insurance contract. When an insurance company prepares financial statements by applying Korean IFRS No.1117, significant differences from the past financial statements are as follows.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023. (cont’d)

(Measurement of Insurance liabilities, etc.)

Under Korean IFRS No.1117, the Group estimates all cash flows from insurance contracts and measures the insurance liabilities using discount rate that reflects assumptions and risks at the reporting date.

In detail, the Group identifies a group and portfolio of insurance contracts that are onerous based on the possibility of becoming onerous, similar risks and managed together. The possibility of becoming onerous of insurance contracts is determined by risk adjustment for non-financial risk and the ratio of contractual service margin at the initial recognition of the insurance contract. The Group determines the minimum level of group of insurance contracts at initial recognition as unit of account; and the level of the group determined is not reassessed subsequently. The Group does not include contracts issued more than one year apart within the same group of insurance contracts, except addressed in transition clauses.

The groups of insurance contracts are measured as the sum of the estimate of future cash flows (including cash flows related to policy loans and reflecting time value of money, etc.), risk adjustment, and the contractual service margin. With the adoption of Korean IFRS No.1117, account of the contractual service margin was introduced, which means unearned profit that would be recognized by providing insurance service in the future.

Meanwhile, reinsurance contracts mean insurance contracts issued by a reinsurance company to compensate claims arising from original insurance contracts issued by other insurance companies. The groups of insurance contracts also apply assumptions consistent with the groups of original insurance contracts when estimating the present value of future cash flows for the groups of insurance contracts ceded.

(Recognition and measurement of financial performance)

Under Korean IFRS No.1117, the Group recognizes insurance revenue on an accrual basis for services (insurance coverage) provided to the policyholder by each annual reporting period, excluding investment component (refunds due to termination and maturity) to be paid to the policyholder regardless of the insured event.

The Group also includes the time value of money, financial risk and effects of their fluctuations related to the group of insurance contracts and the Group has selected accounting policy whether the insurance finance income or expenses for the periods are disaggregated to profit or loss, or other comprehensive income.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023. (cont’d)

(Accounting policy for transition of insurance contracts)

Under transition requirements of Korean IFRS No.1117, the Group shall adjust the original cost-based measurement to current measurement by applying the fully retrospective approach, modified retrospective approach or fair value approach, for the group of insurance contracts issued before the transition date (the beginning of the annual reporting period immediately preceding initial application date of January 1, 2022).

In principle, the Group shall identify, recognize and measure (the fully retrospective approach) each group of insurance contracts as if Korean IFRS No.1117 had always applied before the transition date. If this method is impracticable, the Group can apply the modified retrospective approach or the fair value approach. However, the fair value approach can be applied even though it is possible to apply the fully retrospective approach for the group of insurance contracts with direct participation features that meet specific requirements.

Meanwhile, the modified retrospective approach is a way to obtain results very close to the fully retrospective approach by using all reasonable and supportable information available without undue cost or effort. The fair value approach is a way to measure group of insurance contracts using fair value measurements based on Korean IFRS No.1113 Fair Value Measurements. When applying the fair value approach, contractual service margin or loss component of the liability for remaining coverage at the transition date are measured as the difference between the fair value of a group of insurance contracts at that date and the fulfilment cash flows measured at that date.

KB Life Insurance Co., Ltd. applied the fully retrospective approach for the group of insurance contracts issued within three years before the transition date as of January 1, 2022 (the contracts issued from 2019 to 2021); and applied the fair value approach for the group of insurance contracts issued three years before the transition date (the contracts issued before 2019). Especially, when applying the fully retrospective approach for the group of insurance contracts that former Prudential Life Insurance Company of Korea Ltd. had, the contractual service margin thereof for initial recognition was measured applying the fair value of the business combination in accordance with Korean IFRS No. 1117 paragraph for ‘initial recognition of transfers of insurance contracts and business combinations’.

Additionally, KB Insurance Co., Ltd. applied the fully retrospective approach for the group of insurance contracts issued within four years before the transition date (the contracts issued from 2018 to 2021); and applied the fair value approach for the group of insurance contracts issued more than four years before the transition date (the contracts issued before 2018).

Under Korean IFRS No. 1117, the Group measures insurance liabilities at their present value using a discount rate that reflects assumptions and risks at current point in time (the reporting date). Generally, the general model is applied to general life insurance contracts, while the premium allocation approach is used for general non-life insurance contracts with a guaranteed period of one year or less at the initial recognition date.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023. (cont’d)

Changes in major accounting policies following the application of Korean IFRS No.1117 are shown in the table below.


	Korean IFRS No.1104	Korean IFRS No.1117
Insurance liability measurement	Measured at cost using past information	Measured at current value using information at the time of reporting
Insurance liability measurement	Measured at cost using past information	Necessary to select a conversion method that adjusts the past group of insurance contracts to the current value at the date of conversion. (Complete/modified retrospective method or fair value method applied)

Recognition of insurance revenue	Application of the cash basis in which premiums received are recognized as insurance revenue	Recognition of revenue by reflecting services provided to contractors by the Group for each fiscal year (accrual basis)

	Investment-type items such as cancellation and maturity refunds are also included in insurance income.	Investment components (cancellation, maturity refund) are excluded from insurance income

Insurance contract loan	Recognized as a separate asset	Recognition as included in insurance liabilities

Unamortized new contract costs	Unamortized new contract costs are recorded as a separate asset	Unamortized new contract costs are not separately recognized.

	Insurance liabilities are evaluated based on net insurance premiums (excluding business expenses)	Insurance liabilities are evaluated based on operating insurance premiums (including business expenses)

(Changes in the consolidated statement of financial position and consolidated statement of comprehensive income)

The effect of the change in accounting policy following the initial application of Korean IFRS No.1117 to the consolidated statement of financial position as of December 31, 2022 and the consolidated statement of comprehensive income for the six-month period ended June 30, 2022 is as follows.

When applying Korean IFRS No.1117, the Group’s assets, liabilities and equity as of December 31, 2022 are 688,664,826 million, 634,520,578 million, and 54,144,248 million, respectively, and profit and total comprehensive income for the six-month period ended June 30, 2022 are 2,686,020 million and 2,577,618 million, respectively.

Compared to Korean IFRS No.1104, the Group’s assets and liabilities as of December 31, 2022 decreased by 12,506,022 million and 17,007,356 million, respectively, and its equity increased by 4,501,334 million. Both profit and profit attributable to shareholders of the Parent Company decreased by 86,085 million, and total comprehensive income increased by 2,912,649 million for the six-month period ended June 30, 2022.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023. (cont’d)

1) Consolidated statement of financial position as of December 31, 2022

(In millions of Korean won)


Korean IFRS No.1104		Korean IFRS No.1117		Net increase (decrease)
Assets		Assets
Cash and due from financial institutions	32,063,421	Cash and due from financial institutions	32,474,750		411,329
Financial assets at fair value through profit or loss	64,935,344	Financial assets at fair value through profit or loss	70,092,497		5,157,153
Derivative financial assets	9,446,134	Derivative financial assets	9,446,580		446
Loans measured at amortized cost	436,530,502	Loans measured at amortized cost	433,038,931		(3,491,571	)
Financial investments	116,588,575	Financial investments	115,452,659		(1,135,916	)
Investments in associates and joint ventures	682,670	Investments in associates and joint ventures	682,670		—
		Insurance contract assets	83,304		83,304
		Reinsurance contract assets	1,495,966		1,495,966
Property and equipment	4,991,467	Property and equipment	4,991,467		—
Investment properties	3,148,340	Investment properties	3,148,340		—
Intangible assets	3,200,399	Intangible assets	1,858,470		(1,341,929	)
Net defined benefit assets	478,934	Net defined benefit assets	478,934		—
Current income tax assets	204,690	Current income tax assets	204,690		—
Deferred income tax assets	251,085	Deferred income tax assets	188,372		(62,713	)
Assets held for sale	211,758	Assets held for sale	211,758		—
Other assets	28,437,529	Other assets	14,815,438		(13,622,091	)

Total assets	701,170,848	Total assets	688,664,826		(12,506,022	)

Liabilities		Liabilities
Financial liabilities at fair value through profit or loss	12,271,604	Financial liabilities at fair value through profit or loss	12,271,604		—
Derivative financial liabilities	9,506,709	Derivative financial liabilities	9,509,769		3,060
Deposits	388,888,452	Deposits	393,928,904		5,040,452
Borrowings	71,717,366	Borrowings	71,717,366		—
Debentures	68,698,203	Debentures	68,698,203		—

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023. (cont’d)

1) Consolidated statement of financial position as of December 31, 2022 (cont’d)

(In millions of Korean won)


Korean IFRS No.1104			Korean IFRS No.1117			Net increase (decrease)
Liabilities			Liabilities
Insurance contract liabilities	58,230,303		Insurance contract liabilities	45,920,012			(12,310,291	)
			Reinsurance contract liabilities	31,728			31,728
Provisions	968,819		Provisions	933,701			(35,118	)
Net defined benefit liabilities	85,745		Net defined benefit liabilities	85,745			—
Current income tax liabilities	997,675		Current income tax liabilities	998,681			1,006
Deferred Income tax liabilities	22,693		Deferred Income tax liabilities	1,574,954			1,552,261
Other liabilities	40,140,365		Other liabilities	28,849,911			(11,290,454	)

Total liabilities	651,527,934		Total liabilities	634,520,578			(17,007,356	)

Equity			Equity
Share capital	2,090,558		Share capital	2,090,558			—
Hybrid securities	4,434,251		Hybrid securities	4,434,251			—
Capital surplus	16,940,731		Capital surplus	16,940,731			—
Accumulated other comprehensive income	(2,713,053	)	Accumulated other comprehensive income	1,312,522			4,025,575
Retained earnings	28,446,513		Retained earnings	28,922,272			475,759
Treasury stock	(836,188	)	Treasury stock	(836,188	)		—
Non-controlling interests	1,280,102		Non-controlling interests	1,280,102			—

Total equity	49,642,914		Total equity	54,144,248			4,501,334

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023. (cont’d)

2) Consolidated statement of comprehensive income for the six-month period ended June 30, 2022

(In millions of Korean won)


Korean IFRS No.1104			Korean IFRS No.1117			Net increase (decrease)
Net interest income	6,295,819		Net interest income*	5,472,763			(823,056	)
Interest income	9,004,851		Interest income	8,999,760			(5,091	)
Interest income on financial instruments measured at fair value through other comprehensive income and amortized cost	8,633,017		Interest income on financial instruments measured at fair value through other comprehensive income and amortized cost	8,594,390			(38,627	)
Interest income on financial instruments measured at fair value through profit or loss	371,834		Interest income on financial instruments measured at fair value through profit or loss	396,149			24,315
			Insurance finance interest income	9,221			9,221
Interest expenses	(2,709,032	)	Interest expenses	(3,526,997	)		(817,965	)
Interest expenses	(2,709,032	)	Interest expenses	(2,709,030	)		2
			Insurance finance interest expense	(817,967	)		(817,967	)
Net fee and commission income	1,789,878		Net fee and commission income	1,891,812			101,934
Fee and commission income	2,648,152		Fee and commission income	2,650,233			2,081
Fee and commission expense	(858,274	)	Fee and commission expense	(758,421	)		99,853
Net insurance income	354,989		Insurance service result	815,571			460,582
Insurance income	8,502,813		Insurance income	4,784,118			(3,718,695	)
Insurance income	8,502,813		Insurance income	4,641,295			(3,861,518	)
			Reinsurance income	142,823			142,823
Insurance expense	(8,147,824	)	Insurance expense	(3,968,547	)		4,179,277
Insurance expense	(8,147,824	)	Insurance service expense	(3,613,984	)		4,533,840
			Reinsurance expense	(354,563	)		(354,563	)
Net gains (losses) on financial instruments at fair value through profit or loss	(145,993	)	Net gains (losses) on financial instruments at fair value through profit or loss	(1,198,796	)		(1,052,803	)
			Other insurance finance income	655,752			655,752
Net other operating expenses	(885,445	)	Net other operating expenses	(754,156	)		131,289
General and administrative expenses	(3,445,904	)	General and administrative expenses	(3,034,232	)		411,672
Operating profit before credit loss allowance	3,963,344		Operating profit before credit loss allowance	3,848,714			(114,630	)
Provision for credit losses	(461,341	)	Provision for credit losses	(475,543	)		(14,202	)
Operating income	3,502,003		Operating income	3,373,171			(128,832	)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023. (cont’d)

2) Consolidated statement of comprehensive income for the six-month period ended June 30, 2022 (cont’d)

(In millions of Korean won)


Korean IFRS No.1104			Korean IFRS No.1117			Net increase (decrease)
Net non-operating income	199,429		Net non-operating income	201,928			2,499
Share of profit of associates and joint ventures	(19,859	)	Share of profit of associates and joint ventures	(19,859	)		—
Net other non-operating income (expenses)	219,288		Net other non-operating income (expenses)	221,787			2,499
Profit before income tax expense	3,701,432		Profit before income tax expense	3,575,099			(126,333	)
Income tax expense	(929,327	)	Income tax expense	(889,079	)		40,248
Profit for the period	2,772,105		Profit for the period	2,686,020			(86,085	)
Other comprehensive income for the period, net of tax	(3,107,136	)	Other comprehensive income for the period, net of tax	(108,402	)		2,998,734
Comprehensive income that will not be reclassified to profit or loss	(741,397	)	Comprehensive income that will not be reclassified to profit or loss	(741,779	)		(382	)
Comprehensive income that may be reclassified subsequently to profit or loss	(2,365,739	)	Comprehensive income that may be reclassified subsequently to profit or loss	633,377			2,999,116
Total comprehensive income for the period	(335,031	)	Total comprehensive income for the period	2,577,618			2,912,649
Profit attributable to:	2,772,105		Profit attributable to:	2,686,020			(86,085	)
Shareholders of the Parent Company	2,756,608		Shareholders of the Parent Company	2,670,523			(86,085	)
Non-controlling interests	15,497		Non-controlling interests	15,497			—
Total comprehensive income for the period attributable to:	(335,031	)	Total comprehensive income for the period attributable to:	2,577,618			2,912,649
Shareholders of the Parent Company	(366,117	)	Shareholders of the Parent Company	2,546,532			2,912,649
Non-controlling interests	31,086		Non-controlling interests	31,086			—

*	Includes insurance interest expense on insurance contract liabilities.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.1 The Group has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023. (cont’d)

•

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

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.2 Restatement of cash flow statement for the six-month period ended June 30, 2022

The Group had classified due from financial institutions with restriction to use, such as reserve requirement deposits, as due from financial institutions measured at amortized cost rather than cash and cash equivalents until September 30, 2022; however, following the IFRS Interpretations Committee’s decision that cash and cash equivalents include restricted demand deposits, some classified due from financial institutions with restriction to use, such as reserve requirement deposits, from October 1, 2022, the Group has retrospectively classified these accounts as cash and cash equivalents. The comparative consolidated statements of cash flows have been restated to reflect the changes made to retrospective application.

The effects on the consolidated statements of cash flows for the six-month period ended June 30, 2022, are as follows:


(In millions of Korean won)
	2022
Increase in changes in other assets		390,908
Increase in effect of exchange rate changes on cash and cash equivalents in foreign currency		127,227
Increase in beginning balance of cash and cash equivalents		16,164,813
Increase in ending balance of cash and cash equivalents		16,682,948

2.1.3 The following are the accounting standards that have been established or announced but have not yet been implemented, which the Group has not applied.

•

Amendment of K-IFRS No.1001 “Presentation of Financial Statements” - Classification of Liabilities into Current and Non-Current, and Non-current Liabilities with Covenants

Liabilities are classified as current or non-current based on their substantive rights existing at the end of the reporting period, without considering the possibility of exercising the right to delay the payment or the management’s expectations. Also, even if the transfer of equity instruments is included in the payment of liabilities, it is excluded if the option to pay with equity instruments is recognized separately from the liability in a compound financial instrument and meets the definition of equity instruments. In addition, agreements that the Group must comply with after the end of the reporting period do not affect the classification of the relevant liabilities at the end of the reporting period; further, if liabilities that must comply with agreements within 12 months after the reporting period are classified as non-current liabilities as of the end of the reporting period, the entity should disclose the risk that the liabilities may be repaid within 12 months after the reporting period. This amendment will be applied to the financial statements for the accounting year beginning on or after January 1, 2024. The Group expects that this amendment will not have a significant impact on the consolidated financial statements.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 Parent Company‘s functional and presentation currency.

2.4 Critical Accounting Estimates

The preparation of the consolidated financial statements requires the application of accounting policies, certain critical accounting estimates and assumptions that may have a significant impact on the assets (liabilities) and incomes (expenses). Management’s estimates of outcomes may differ from actual outcomes if management’s estimates and assumptions based on management’s best judgment at the reporting date 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.

Significant accounting estimates and assumptions applied in the preparation of these condensed consolidated interim financial statements are the same as those applied to the consolidated financial statements for the year ended December 31, 2022, except for the estimates used to determine income tax expense.

3. Material Accounting Policies

The material accounting policies and calculation methods applied in the preparation of these condensed consolidated interim financial statements are the same as those applied to the consolidated financial statements for the year ended December 31, 2022, except for the impact of changes due to adopting new and amended standards and interpretations described in Note 2.1 and below paragraph.

Income tax expense for the interim period is measured applying the expected average annual income tax rate for the expected total annual income.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 the Group by increasing risk transparency, preventing risk transfer between subsidiaries and preemptive response to rapidly changing financial environments. Credit risk, market risk, operational risk, interest rate risk, insurance risk, liquidity risk, credit concentration risk, strategy risk, and reputation 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, deals with 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, reviewing the level of risk and the status of risk management activities, approving the application of risk management systems, methodologies, and major improvements, and establishing and approving risk management policies and procedures to timely recognize, measure, monitor, and control risks arising from various transactions by the Group.

4.1.2.2 Risk Management Council

The Risk Management Council is responsible for consulting on matters delegated by the Risk Management Committee and requests for review by the Management Executive Committee, consulting on details of each subsidiary’s risk management policies and procedures, monitoring the Group’s risk management status, and establishing and implementing necessary measures.

4.1.2.3 Risk Management Department

The Risk Management Department performs the Group’s risk management detailed policies, procedures, and business processes, and is responsible for calculating the Group’s risk-weighted assets, monitoring and managing internal capital limits.

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 purposes, the Group manages all factors of credit risk exposure, such as default risk of individual borrowers, country risk, and risk of specific sectors in an integrated way.

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 Kookmin 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 Kookmin 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, Kookmin 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.

KB Kookmin Card Co., Ltd.‘s credit scoring system is divided into Application Scoring System (“ASS”) and Behavior Scoring System (“BSS”). For applications that meet the eligibility criteria for card issuance, the card will be issued only if the ASS credit rating is above the standard. KB Kookmin Card Co., Ltd.‘s internal information, external information from the credit bureau company and others, and personal information on the application are used to calculate the ASS credit rating. The BSS, which is recalculated on a weekly basis, predicts the delinquency probability of cardholders, and utilizes it to monitor cardholders and portfolio risk.

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 of Kookmin Bank, a subsidiary, is in charge of loan policy, loan system, credit rating, credit analysis, follow-up management, and corporate restructuring. The Risk Management Group of Kookmin Bank 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.

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Financial assets
Due from financial institutions measured at amortized cost *		29,033,323		29,912,097
Financial assets at fair value through profit or loss:
Due from financial institutions measured at fair value through profit or loss		103,568		69,469
Securities measured at fair value through profit or loss		69,927,581		65,899,397
Loans measured at fair value through profit or loss		176,945		493,562
Financial instruments indexed to the price of gold		89,012		90,006
Derivatives		8,195,304		9,446,580
Loans measured at amortized cost *		434,953,555		433,038,931
Financial investments:
Securities measured at fair value through other comprehensive income		76,856,309		76,648,353
Securities measured at amortized cost *		36,885,994		35,919,241
Loans measured at fair value through other comprehensive income		691,667		549,272
Other financial assets *		21,470,146		10,718,383

		678,383,404		662,785,291

Off-balance sheet items
Acceptances and guarantees contracts		14,050,848		12,425,753
Financial guarantee contracts		9,286,273		8,297,042
Commitments		195,746,978		188,295,902

		219,084,099		209,018,697

		897,467,503		871,803,988

*	After netting of allowance

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. 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.

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.4.1 Credit risk exposure

Credit qualities of loans as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


	June 30, 2023
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Loans measured at amortized cost *
Corporate
Grade 1		139,381,800		5,031,235		3,013		—		144,416,048
Grade 2		65,940,920		8,214,060		125,497		—		74,280,477
Grade 3		4,110,779		3,521,744		7,400		—		7,639,923
Grade 4		711,715		999,580		18,266		—		1,729,561
Grade 5		88,996		515,377		2,574,280		—		3,178,653

		210,234,210		18,281,996		2,728,456		—		231,244,662

Retail
Grade 1		161,298,495		4,043,237		10,325		—		165,352,057
Grade 2		8,384,351		3,684,646		35,863		—		12,104,860
Grade 3		5,061,029		1,492,902		26,907		—		6,580,838
Grade 4		220,008		360,067		27,355		—		607,430
Grade 5		45,271		867,572		1,011,662		—		1,924,505

		175,009,154		10,448,424		1,112,112		—		186,569,690

Credit card
Grade 1		11,569,156		336,983		—		—		11,906,139
Grade 2		4,848,940		817,634		—		—		5,666,574
Grade 3		1,631,656		1,513,257		—		—		3,144,913
Grade 4		7,582		296,138		—		—		303,720
Grade 5		4,059		176,067		750,671		—		930,797

		18,061,393		3,140,079		750,671		—		21,952,143

		403,304,757		31,870,499		4,591,239		—		439,766,495

Loans measured at fair value through other comprehensive income
Corporate
Grade 1		629,664		—		—		—		629,664
Grade 2		62,003		—		—		—		62,003
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		691,667		—		—		—		691,667

		691,667		—		—		—		691,667

		403,996,424		31,870,499		4,591,239		—		440,458,162

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.4.1 Credit risk exposure (cont’d)

(In millions of Korean won)


	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Loans measured at amortized cost *
Corporate
Grade 1		134,819,382		5,877,660		3,372		—		140,700,414
Grade 2		65,653,118		8,585,346		4,480		—		74,242,944
Grade 3		4,054,714		3,221,267		14,694		—		7,290,675
Grade 4		570,671		922,748		34,298		—		1,527,717
Grade 5		11,909		419,058		1,959,706		—		2,390,673

		205,109,794		19,026,079		2,016,550		—		226,152,423

Retail
Grade 1		164,125,295		4,240,281		11,287		—		168,376,863
Grade 2		8,100,613		3,846,756		32,878		—		11,980,247
Grade 3		4,320,640		1,477,297		25,600		—		5,823,537
Grade 4		306,655		315,357		32,330		—		654,342
Grade 5		26,013		742,720		834,178		—		1,602,911

		176,879,216		10,622,411		936,273		—		188,437,900

Credit card
Grade 1		11,547,014		1,316,136		—		—		12,863,150
Grade 2		4,390,211		1,214,946		—		—		5,605,157
Grade 3		1,142,362		1,925,145		—		—		3,067,507
Grade 4		2,227		302,736		—		—		304,963
Grade 5		666		173,049		595,101		—		768,816

		17,082,480		4,932,012		595,101		—		22,609,593

		399,071,490		34,580,502		3,547,924		—		437,199,916

Loans measured at fair value through other comprehensive income
Corporate
Grade 1		489,445		—		—		—		489,445
Grade 2		59,827		—		—		—		59,827
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		549,272		—		—		—		549,272

		549,272		—		—		—		549,272

		399,620,762		34,580,502		3,547,924		—		437,749,188

*	Before netting of allowance

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.4.1 Credit risk exposure (cont’d)

Credit qualities of loans graded according to internal credit ratings as of June 30, 2023 and December 31, 2022, are as follows:


	Range of probability of default (%)	Retail	Corporate
Grade 1	0.0 ~ 1.0	1 ~ 5 grade	AAA ~ BBB+
Grade 2	1.0 ~ 5.0	6 ~ 8 grade	BBB ~ BB
Grade 3	5.0 ~ 15.0	9 ~ 10 grade	BB- ~ B
Grade 4	15.0 ~ 30.0	11 grade	B- ~ CCC
Grade 5	30.0 ~	12 grade or under	CC or under

4.2.4.2 Quantification of the extent to which collateral and other credit enhancements mitigate credit risk of loans as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	12-month expected credit losses		Lifetime expected credit losses				Total
	12-month expected credit losses		Non-impaired		Impaired		Total
Guarantees		104,213,017		7,079,904		401,730		111,694,651
Deposits and savings		1,761,449		114,767		49,857		1,926,073
Property and equipment		14,307,647		996,049		202,577		15,506,273
Real estate		191,087,924		16,099,064		2,051,838		209,238,826

		311,370,037		24,289,784		2,706,002		338,365,823


(In millions of Korean won)	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Total
	12-month expected credit losses		Non-impaired		Impaired		Total
Guarantees		100,429,157		7,060,738		301,688		107,791,583
Deposits and savings		1,855,720		141,016		46,984		2,043,720
Property and equipment		14,648,523		1,002,291		180,103		15,830,917
Real estate		191,121,014		15,793,644		1,708,145		208,622,803

		308,054,414		23,997,689		2,236,920		334,289,023

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.5 Credit risk of securities

Credit qualities of securities exposed to credit risk other than equity securities among financial investments as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


	June 30, 2023
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Securities measured at amortized cost *
Grade 1		34,023,749		—		—		—		34,023,749
Grade 2		2,875,034		—		—		—		2,875,034
Grade 3		1,329		—		—		—		1,329
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		36,900,112		—		—		—		36,900,112

Securities measured at fair value through other comprehensive income
Grade 1		70,396,925		—		—		—		70,396,925
Grade 2		6,397,799		—		—		—		6,397,799
Grade 3		61,585		—		—		—		61,585
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		76,856,309		—		—		—		76,856,309

		113,756,421		—		—		—		113,756,421

(In millions of Korean won)


	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Securities measured at amortized cost *
Grade 1		34,211,405		—		—		—		34,211,405
Grade 2		1,713,414		—		—		—		1,713,414
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		35,924,819		—		—		—		35,924,819

Securities measured at fair value through other comprehensive income
Grade 1		70,830,502		—		—		—		70,830,502
Grade 2		5,669,442		53,861		—		—		5,723,303
Grade 3		66,797		9,169		—		—		75,966
Grade 4		13,942		4,640		—		—		18,582
Grade 5		—		—		—		—		—

		76,580,683		67,670		—		—		76,648,353

		112,505,502		67,670		—		—		112,573,172

*	Before netting of allowance

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.5 Credit risk of securities (cont’d)

Credit qualities of securities other than equity securities, according to the credit ratings by external credit rating agencies as of June 30, 2023 and December 31, 2022, are as follows:

Credit

quality

Domestic

Foreign

KIS

NICE P&I

KAP

FnPricing Inc.

S&P

Fitch-IBCA

Moody’s

Grade 1

AA0 to AAA

A- to AAA

A3 to Aaa

Grade 2

A- to AA-

BBB- to BBB+

Baa3 to Baa1

Grade 3

BBB0 to BBB+

BB to BB+

Ba2 to Ba1

Grade 4

BB0 to BBB-

B+ to BB-

B1 to Ba3

Grade 5

BB- 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 June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


	June 30, 2023
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Due from financial institutions measured at amortized cost *
Grade 1		27,935,652		—		—		—		27,935,652
Grade 2		532,810		—		—		—		532,810
Grade 3		30		—		—		—		30
Grade 4		—		—		—		—		—
Grade 5		566,232		—		—		—		566,232

		29,034,724		—		—		—		29,034,724

(In millions of Korean won)


	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Due from financial institutions measured at amortized cost *
Grade 1		28,023,879		—		—		—		28,023,879
Grade 2		1,428,663		—		—		—		1,428,663
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		462,298		—		—		—		462,298

		29,914,840		—		—		—		29,914,840

*	Before netting of allowance

The classification criteria of the credit qualities of due from financial institutions as of June 30, 2023 and December 31, 2022, are the same as the criteria for securities other than equity securities.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.7 Credit risk concentration analysis

4.2.7.1 Classifications of corporate loans by industry as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


	June 30, 2023
	Loans		%		Allowances			Carrying amount
Financial institutions		24,278,587		10.46		(51,971	)		24,226,616
Manufacturing		53,072,116		22.86		(688,233	)		52,383,883
Service		102,048,916		43.97		(736,088	)		101,312,828
Wholesale and retail		30,061,310		12.95		(481,312	)		29,579,998
Construction		6,937,562		2.99		(273,531	)		6,664,031
Public sector		2,149,446		0.92		(110,055	)		2,039,391
Others		13,565,337		5.85		(243,049	)		13,322,288

		232,113,274		100.00		(2,584,239	)		229,529,035

(In millions of Korean won)


	December 31, 2022
	Loans		%		Allowances			Carrying amount
Financial institutions		23,832,403		10.49		(52,250	)		23,780,153
Manufacturing		53,293,160		23.46		(575,186	)		52,717,974
Service		98,549,099		43.38		(479,709	)		98,069,390
Wholesale and retail		29,712,579		13.08		(352,208	)		29,360,371
Construction		6,906,750		3.04		(228,782	)		6,677,968
Public sector		1,940,133		0.85		(84,436	)		1,855,697
Others		12,961,133		5.70		(213,205	)		12,747,928

		227,195,257		100.00		(1,985,776	)		225,209,481

4.2.7.2 Classifications of retail loans and credit card receivables as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


	June 30, 2023
	Loans		%		Allowances			Carrying amount
Housing loan		93,408,807		44.80		(195,302	)		93,213,505
General loan		93,160,883		44.68		(1,128,041	)		92,032,842
Credit card		21,952,143		10.52		(905,358	)		21,046,785

		208,521,833		100.00		(2,228,701	)		206,293,132

(In millions of Korean won)


	December 31, 2022
	Loans		%		Allowances			Carrying amount
Housing loan		94,767,212		44.90		(163,348	)		94,603,864
General loan		93,670,687		44.38		(1,174,018	)		92,496,669
Credit card		22,609,593		10.72		(837,842	)		21,771,751

		211,047,492		100.00		(2,175,208	)		208,872,284

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.7.3 Classifications of due from financial institutions, securities other than equity securities, and derivative financial assets by industry as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Finance and insurance		29,034,724		100.00		(1,401	)		29,033,323

		29,034,724		100.00		(1,401	)		29,033,323

Due from financial institutions measured at fair value through profit or loss
Finance and insurance		103,568		100.00		—			103,568

		103,568		100.00		—			103,568

Securities measured at fair value through profit or loss
Government and government funded institutions		20,786,761		29.73		—			20,786,761
Finance and insurance		35,231,966		50.38		—			35,231,966
Others		13,908,854		19.89		—			13,908,854

		69,927,581		100.00		—			69,927,581

Derivative financial assets
Government and government funded institutions		49,063		0.60		—			49,063
Finance and insurance		7,746,824		94.53		—			7,746,824
Others		399,417		4.87		—			399,417

		8,195,304		100.00		—			8,195,304

Securities measured at fair value through other comprehensive income
Government and government funded institutions		41,928,865		54.55		—			41,928,865
Finance and insurance		22,973,192		29.89		—			22,973,192
Others		11,954,252		15.56		—			11,954,252

		76,856,309		100.00		—			76,856,309

Securities measured at amortized cost
Government and government funded institutions		16,677,725		45.20		(716	)		16,677,009
Finance and insurance		19,449,338		52.70		(12,418	)		19,436,920
Others		773,049		2.10		(984	)		772,065

		36,900,112		100.00		(14,118	)		36,885,994

		221,017,598				(15,519	)		221,002,079

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022


(In millions of Korean won)	December 31, 2022
	Amount		%		Allowances			Carrying amount
Due from financial institutions measured at amortized cost
Finance and insurance		29,914,840		100.00		(2,743	)		29,912,097

		29,914,840		100.00		(2,743	)		29,912,097

Due from financial institutions measured at fair value through profit or loss
Finance and insurance		69,469		100.00		—			69,469

		69,469		100.00		—			69,469

Securities measured at fair value through profit or loss
Government and government funded institutions		16,556,811		25.12		—			16,556,811
Finance and insurance		37,674,363		57.17		—			37,674,363
Others		11,668,223		17.71		—			11,668,223

		65,899,397		100.00		—			65,899,397

Derivative financial assets
Government and government funded institutions		58,060		0.61		—			58,060
Finance and insurance		8,988,025		95.15		—			8,988,025
Others		400,495		4.24		—			400,495

		9,446,580		100.00		—			9,446,580

Securities measured at fair value through other comprehensive income
Government and government funded institutions		41,566,376		54.23		—			41,566,376
Finance and insurance		22,463,066		29.31		—			22,463,066
Others		12,618,911		16.46		—			12,618,911

		76,648,353		100.00		—			76,648,353

Securities measured at amortized cost
Government and government funded institutions		16,984,957		47.28		(3	)		16,984,954
Finance and insurance		18,368,966		51.13		(5,212	)		18,363,754
Others		570,896		1.59		(363	)		570,533

		35,924,819		100.00		(5,578	)		35,919,241

		217,903,458				(8,321	)		217,895,137

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.

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 risk management policies and liquidity 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 calculates and manages liquidity ratio and others for all transactions and off-balance transactions related to liquidity, 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 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 consolidated statements of financial position which are based on discounted cash flows. The future interest payments for floating-rate liabilities are calculated on the assumption that the current interest rate is the same until maturity.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 June 30, 2023 and December 31 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	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		2,771,385		—		—		—		—		—		2,771,385
Financial liabilities designated at fair value through profit or loss 1		9,273,034		—		—		—		—		—		9,273,034
Derivatives held for trading 1		7,684,748		—		—		—		—		—		7,684,748
Derivatives held for hedging 2		32,520		6,730		10,082		69,813		109,479		4,821		233,445
Deposits 3		167,983,534		27,152,311		45,888,243		144,305,179		15,067,665		1,134,647		401,531,579
Borrowings		10,752,253		17,983,406		7,369,529		21,414,670		12,192,811		1,139,696		70,852,365
Debentures		10,496		5,960,303		7,809,327		16,461,519		36,116,304		6,298,396		72,656,345
Lease liabilities		204		26,666		43,936		166,552		359,431		22,358		619,147
Other financial liabilities		136,205		31,077,481		205,228		288,102		990,366		386,281		33,083,663

		198,644,379		82,206,897		61,326,345		182,705,835		64,836,056		8,986,199		598,705,711

Off-balance sheet items
Commitments 4		195,746,978		—		—		—		—		—		195,746,978
Acceptances and guarantees contracts		14,050,848		—		—		—		—		—		14,050,848
Financial guarantee contracts 5		9,286,273		—		—		—		—		—		9,286,273

		219,084,099		—		—		—		—		—		219,084,099

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 June 30, 2023 and December 31 2022, are as follows: (cont’d)


(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		2,193,210		—		—		—		—		—		2,193,210
Financial liabilities designated at fair value through profit or loss 1		10,078,394		—		—		—		—		—		10,078,394
Derivatives held for trading 1		9,209,537		—		—		—		—		—		9,209,537
Derivatives held for hedging 2		—		11,106		8,886		39,174		221,551		3,502		284,219
Deposits 3		175,530,178		29,911,835		45,245,496		131,765,097		17,979,299		1,129,024		401,560,929
Borrowings		7,831,474		23,821,330		7,676,952		19,120,861		12,839,302		1,159,432		72,449,351
Debentures		11,117		4,011,679		8,353,663		20,995,587		33,216,320		6,485,136		73,073,502
Lease liabilities		164		28,079		45,200		171,449		376,159		2,839		623,890
Other financial liabilities		179,241		17,938,781		368,218		447,898		907,643		428,310		20,270,091

		205,033,315		75,722,810		61,698,415		172,540,066		65,540,274		9,208,243		589,743,123

Off-balance sheet items
Commitments 4		188,295,902		—		—		—		—		—		188,295,902
Acceptances and guarantees contracts		12,425,753		—		—		—		—		—		12,425,753
Financial guarantee contracts 5		8,297,042		—		—		—		—		—		8,297,042

		209,018,697		—		—		—		—		—		209,018,697

Financial liabilities measured or designated 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	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.

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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. The above market risks are measured and managed by each subsidiary.

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 interest rate risk management guidelines for non-trading positions. The entire process is carried out through consultation with the Risk Management Council and approval by the Risk Management Committee of the Group.

In the case of Kookmin Bank, a major subsidiary, the 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.

Kookmin Bank’s Asset-Liability Management Committee (“ALCO”) determines interest rate and commission operating standards and Asset Liability Management (“ALM”) operation policies and enacts and revises relevant guidelines. The Risk Management Committee and the Risk Management Council monitor the establishment and enforcement of ALM risk management policies and enact and revise 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 Financial Planning 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.

Kookmin 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, Kookmin 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. Kookmin 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 and minimizing confusion among stakeholders.

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.5 Operational Risk

4.5.1 Concept

Operational risk of the Group refers to the risk of loss that may occur due to improper or incorrect internal procedures, personnel, systems or external events. Operational risk management plays a role in enhancing the stability and soundness of financial institutions by managing the appropriate level of capital and supplementing the internal control system.

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 Parent Company manages the Group’s overall operational risk, and each subsidiary establishes and implements operational risk management policies according to its own risk level and implements and operates related systems. The Group Risk Management Committee establishes and allocates risk capital of operational risk for each subsidiary, and subsidiaries manage operational risks at an appropriate level within the allocated risk capital.

5. Segment Information

5.1 Overall Segment Information and Business Segments

The Group classifies reporting segments based on the nature of the products and services provided, the type of customer, and the Group’s management organization.


Banking business	Corporate banking	Loans, deposit products, and other related financial services to large, small and medium-sized enterprises and SOHOs

	Retail banking	Loans, deposit products, and other related financial services to individuals and households

	Other banking services	Trading activities in securities and derivatives, funding, and other supporting activities

Securities business		Investment banking, brokerage services, and other supporting activities

Non-life insurance business		Non-life insurance and other supporting activities

Credit card business		Credit sale, cash advance, card loan, and other supporting activities

Life insurance business		Life insurance and other supporting activities

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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

Financial information by business segment for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)
	2023
	Banking business												Securities			Non-life insurance			Credit card			Life insurance			Others			Consolidation adjustments			Total
	Corporate banking			Retail banking			Other banking services			Sub-total			Securities			Non-life insurance			Credit card			Life insurance			Others			Consolidation adjustments			Total
Net operating revenues from external customers		2,757,780			2,293,457			22,473			5,073,710			987,275			818,874			1,001,622			190,378			584,892			—			8,656,751
Intersegment net operating revenues (expenses)		200,313			—			91,765			292,078			(50,393	)		(36,182	)		(74,976	)		10,272			185,890			(326,689	)		—

		2,958,093			2,293,457			114,238			5,365,788			936,882			782,692			926,646			200,650			770,782			(326,689	)		8,656,751

Net interest income		2,718,847			1,763,845			327,629			4,810,321			289,980			(104,111	)		805,090			(235,892	)		296,059			(102,184	)		5,759,263
Interest income		5,587,376			3,790,618			1,368,463			10,746,457			834,266			388,955			1,142,209			282,804			657,148			(54,596	)		13,997,243
Interest expense		(2,868,529	)		(2,026,773	)		(1,040,834	)		(5,936,136	)		(544,286	)		(493,066	)		(337,119	)		(518,696	)		(361,089	)		(47,588	)		(8,237,980	)
Net fee and commission income (expenses)		215,945			144,649			236,657			597,251			385,680			(13,325	)		294,923			(5,722	)		590,432			16,171			1,865,410
Fee and commission income		298,478			215,389			295,742			809,609			504,454			13,528			863,163			957			664,939			(160,234	)		2,696,416
Fee and commission expense		(82,533	)		(70,740	)		(59,085	)		(212,358	)		(118,774	)		(26,853	)		(568,240	)		(6,679	)		(74,507	)		176,405			(831,006	)
Net insurance income		—			—			—			—			—			592,727			4,918			224,142			—			(9,666	)		812,121
Insurance income		—			—			—			—			—			4,897,948			10,827			447,165			—			(18,441	)		5,337,499
Insurance expense		—			—			—			—			—			(4,305,221	)		(5,909	)		(223,023	)		—			8,775			(4,525,378	)
Net gains (losses) on financial instruments at fair value through profit or loss		(2,365	)		—			329,842			327,477			211,386			285,474			4,588			433,511			118,893			(222,015	)		1,159,314
Net other insurance finance expense		—			—			—			—			—			(2,400	)		—			(218,749	)		—			—			(221,149	)
Net other operating income (expenses)		25,666			384,963			(779,890	)		(369,261	)		49,836			24,327			(182,873	)		3,360			(234,602	)		(8,995	)		(718,208	)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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


(In millions of Korean won)
	2023
	Banking business												Securities			Non-life insurance			Credit card			Life insurance			Others			Consolidation adjustments			Total
	Corporate banking			Retail banking			Other banking services			Sub-total			Securities			Non-life insurance			Credit card			Life insurance			Others			Consolidation adjustments			Total
General and administrative expenses		(923,691	)		(898,675	)		(285,062	)		(2,107,428	)		(461,160	)		(72,413	)		(302,602	)		(49,630	)		(225,990	)		59,995			(3,159,228	)
Operating income (expenses) before provision for credit losses		2,034,402			1,394,782			(170,824	)		3,258,360			475,722			710,279			624,044			151,020			544,792			(266,694	)		5,497,523
Reversal (provision) of credit losses		(804,105	)		(14,559	)		50,456			(768,208	)		(21,223	)		140			(363,547	)		471			(169,532	)		2,414			(1,319,485	)
Net operating income (expenses)		1,230,297			1,380,223			(120,368	)		2,490,152			454,499			710,419			260,497			151,491			375,260			(264,280	)		4,178,038
Share of profit (loss) of associates and joint ventures		—			—			7,685			7,685			(15,097	)		1,214			579			—			7,397			2,671			4,449
Net other non-operating income (expenses)		(4,201	)		—			(70,385	)		(74,586	)		(111,576	)		2,939			(1,498	)		4,620			3,666			(16,528	)		(192,963	)
Segment profit (loss) before income tax expense		1,226,096			1,380,223			(183,068	)		2,423,251			327,826			714,572			259,578			156,111			386,323			(278,137	)		3,989,524
Income tax benefit (expense)		(258,869	)		(338,685	)		16,168			(581,386	)		(78,237	)		(189,007	)		(65,453	)		(33,368	)		(56,156	)		18,068			(985,539	)

Profit (loss) for the period		967,227			1,041,538			(166,900	)		1,841,865			249,589			525,565			194,125			122,743			330,167			(260,069	)		3,003,985

Profit (loss) attributable to shareholders of the Parent Company		986,747			1,041,538			(169,777	)		1,858,508			249,574			525,218			192,855			122,743			328,798			(281,009	)		2,996,687
Profit (loss) attributable to non-controlling interests		(19,520	)		—			2,877			(16,643	)		15			347			1,270			—			1,369			20,940			7,298
Total assets *		217,529,545			162,326,927			144,648,043			524,504,515			63,012,587			35,349,569			29,255,855			30,074,809			62,247,415			(38,127,004	)		706,317,746
Total liabilities *		202,111,034			192,506,028			94,928,948			489,546,010			56,885,591			29,353,392			24,552,730			25,953,984			24,414,796			(2,093,662	)		648,612,841

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

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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


(In millions of Korean won)
	2022
	Banking business
	Corporate banking			Retail banking			Other banking services			Sub-total			Securities			Non-life insurance			Credit card			Life insurance			Others			Consolidation adjustments			Total
Net operating revenues from external customers		2,159,211			1,871,347			156,639			4,187,197			663,370			659,899			902,792			(14,245	)		483,933			—			6,882,946
Intersegment net operating revenues (expenses)		7,271			—			322,706			329,977			(931	)		(98,305	)		(63,304	)		(45,708	)		70,522			(192,251	)		—

		2,166,482			1,871,347			479,345			4,517,174			662,439			561,594			839,488			(59,953	)		554,455			(192,251	)		6,882,946

Net interest income		2,194,240			1,972,366			273,591			4,440,197			264,754			(44,624	)		722,117			(179,737	)		271,272			(1,216	)		5,472,763
Interest income		3,255,451			2,599,377			634,765			6,489,593			498,618			331,267			937,149			275,340			491,015			(23,222	)		8,999,760
Interest expense		(1,061,211	)		(627,011	)		(361,174	)		(2,049,396	)		(233,864	)		(375,891	)		(215,032	)		(455,077	)		(219,743	)		22,006			(3,526,997	)
Net fee and commission income (expenses)		191,774			128,275			229,094			549,143			510,793			(14,601	)		290,679			(2,994	)		553,953			4,839			1,891,812
Fee and commission income		266,331			197,905			288,335			752,571			610,722			10,944			811,148			915			620,917			(156,984	)		2,650,233
Fee and commission expense		(74,557	)		(69,630	)		(59,241	)		(203,428	)		(99,929	)		(25,545	)		(520,469	)		(3,909	)		(66,964	)		161,823			(758,421	)
Net insurance income		—			—			—			—			—			652,073			5,326			169,637			—			(11,465	)		815,571
Insurance income		—			—			—			—			—			4,406,049			10,024			386,474			—			(18,429	)		4,784,118
Insurance expense		—			—			—			—			—			(3,753,976	)		(4,698	)		(216,837	)		—			6,964			(3,968,547	)
Net gains (losses) on financial instruments at fair value through profit or loss		65,786			—			(59,804	)		5,982			(124,030	)		(38,353	)		1,498			(776,921	)		(118,678	)		(148,294	)		(1,198,796	)
Net other insurance finance income		—			—			—			—			—			4,730			—			651,022			—			—			655,752
Net other operating income (expenses)		(285,318	)		(229,294	)		36,464			(478,148	)		10,922			2,369			(180,132	)		79,040			(152,092	)		(36,115	)		(754,156	)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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


(In millions of Korean won)
	2022
	Banking business
	Corporate banking			Retail banking			Other banking services			Sub-total			Securities			Non-life insurance			Credit card			Life insurance			Others			Consolidation adjustments			Total
General and administrative expenses		(909,018	)		(932,842	)		(272,983	)		(2,114,843	)		(415,391	)		(64,156	)		(274,694	)		(20,881	)		(205,769	)		61,502			(3,034,232	)
Operating income before provision for credit losses		1,257,464			938,505			206,362			2,402,331			247,048			497,438			564,794			(80,834	)		348,686			(130,749	)		3,848,714
Reversal (provision) of credit losses		17,716			(149,113	)		(63,326	)		(194,723	)		(14,515	)		577			(227,266	)		276			(40,899	)		1,007			(475,543	)
Net operating income		1,275,180			789,392			143,036			2,207,608			232,533			498,015			337,528			(80,558	)		307,787			(129,742	)		3,373,171
Share of profit (loss) of associates and joint ventures		—			—			18,976			18,976			1,834			(129	)		1,456			—			2,517			(44,513	)		(19,859	)
Net other non-operating income (expenses)		(9,960	)		—			14,252			4,292			12,294			216,307			(1,627	)		3,960			(825	)		(12,614	)		221,787
Segment profit before income tax expense		1,265,220			789,392			176,264			2,230,876			246,661			714,193			337,357			(76,598	)		309,479			(186,869	)		3,575,099
Income tax expense		(286,692	)		(188,338	)		(31,392	)		(506,422	)		(64,250	)		(187,667	)		(89,386	)		9,041			(74,301	)		23,906			(889,079	)

Profit for the period		978,528			601,054			144,872			1,724,454			182,411			526,526			247,971			(67,557	)		235,178			(162,963	)		2,686,020

Profit attributable to shareholders of the Parent Company		978,293			601,054			147,093			1,726,440			182,030			526,202			245,657			(67,557	)		232,282			(174,531	)		2,670,523
Profit (loss) attributable to non-controlling interests		235			—			(2,221	)		(1,986	)		381			324			2,314			—			2,896			11,568			15,497
Total assets *		211,989,036			165,273,848			140,506,628			517,769,512			53,824,245			34,743,259			29,721,017			29,989,683			60,219,661			(37,602,551	)		688,664,826
Total liabilities *		205,382,625			191,786,626			86,877,002			484,046,253			47,946,933			29,017,685			24,998,214			26,136,081			25,973,897			(3,598,485	)		634,520,578

*	Assets and liabilities of the reporting segments are amounts before intersegment transactions and as of December 31, 2022.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

5.2 Services and Geographical Segments

5.2.1 Services information

Net operating revenues from external customers by service for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)
	2023		2022
Banking service		5,073,710		4,187,197
Securities service		987,275		663,370
Non-life insurance service		818,874		659,899
Credit card service		1,001,622		902,792
Life insurance service		190,378		(14,245	)
Others		584,892		483,933

		8,656,751		6,882,946

5.2.2 Geographical information

Geographical net operating revenues from external for the six-month periods ended June 30, 2023 and 2022, and major non-current assets as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)
	Net operating revenues from external customers				Major non-current assets
	2023		2022		June 30, 2023		December 31, 2022
Domestic		7,912,573		6,309,509		8,501,479		8,699,340
United States		38,055		28,166		55,590		54,415
New Zealand		5,944		6,345		1,260		1,607
China		98,176		72,555		18,945		21,190
Cambodia		281,834		253,758		63,829		44,786
United Kingdom		23,217		11,111		286,519		90,282
Indonesia		168,184		149,851		443,824		461,165
Others		128,768		51,651		468,771		31,821
Consolidation adjustments		—		—		578,040		567,253

		8,656,751		6,882,946		10,418,257		9,971,859

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Carrying amount		Fair value
Financial assets
Cash and due from financial institutions		31,610,850		31,617,133
Financial assets at fair value through profit or loss:		74,604,619		74,604,619
Due from financial institutions		103,568		103,568
Debt securities		69,927,581		69,927,581
Equity securities		4,307,513		4,307,513
Loans		176,945		176,945
Others		89,012		89,012
Derivatives held for trading		7,772,293		7,772,293
Derivatives held for hedging		423,011		423,011
Loans measured at amortized cost		434,953,555		434,579,619
Securities measured at amortized cost		36,885,994		35,279,630
Financial assets at fair value through other comprehensive income:		80,083,564		80,083,564
Debt securities		76,856,309		76,856,309
Equity securities		2,535,588		2,535,588
Loans		691,667		691,667
Other financial assets		21,470,146		21,470,146

		687,804,032		685,830,015

Financial liabilities
Financial liabilities at fair value through profit or loss		2,771,385		2,771,385
Financial liabilities designated at fair value through profit or loss		9,273,034		9,273,034
Derivatives held for trading		7,684,748		7,684,748
Derivatives held for hedging		315,009		315,009
Deposits		396,081,606		396,284,160
Borrowings		69,261,997		69,012,534
Debentures		68,260,644		67,510,936
Other financial liabilities		42,512,230		42,512,230

		596,160,653		595,364,036

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.1.1 Carrying amount and fair value of financial assets and liabilities by category as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)	December 31, 2022
	Carrying amount		Fair value
Financial assets
Cash and due from financial institutions		32,474,750		32,403,730
Financial assets at fair value through profit or loss:		70,092,497		70,092,497
Due from financial institutions		69,469		69,469
Debt securities		65,899,397		65,899,397
Equity securities		3,540,063		3,540,063
Loans		493,562		493,562
Others		90,006		90,006
Derivatives held for trading		8,984,171		8,984,171
Derivatives held for hedging		462,409		462,409
Loans measured at amortized cost		433,038,931		430,396,089
Securities measured at amortized cost		35,919,241		33,593,231
Financial assets at fair value through other comprehensive income:		79,533,418		79,533,418
Debt securities		76,648,353		76,648,353
Equity securities		2,335,793		2,335,793
Loans		549,272		549,272
Other financial assets		10,718,383		10,718,383

		671,223,800		666,183,928

Financial liabilities
Financial liabilities at fair value through profit or loss		2,193,210		2,193,210
Financial liabilities designated at fair value through profit or loss		10,078,394		10,078,394
Derivatives held for trading		9,209,537		9,209,537
Derivatives held for hedging		300,232		300,232
Deposits		393,928,904		393,458,279
Borrowings		71,717,366		71,187,130
Debentures		68,698,203		67,036,661
Other financial liabilities		26,163,138		26,163,138

		582,288,984		579,626,581

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.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.1.1 Carrying amount and fair value of financial assets and liabilities by category as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)

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		Fair value of securities and others that are traded in an active market 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, Free Cash Flow to Equity Model, Comparable Company Analysis, Dividend Discount Model, Risk Adjusted Discount Rate Method, and Net Asset Value Method.

Loans measured at amortized cost		Fair value of loans 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.

Derivatives and financial instruments at fair value through profit or loss		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, Black-Scholes Model, Hull-white Model, Closed Form, and Tree Model or valuation results from independent external professional valuation institutions.

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 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.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Fair value hierarchy						Total
	Level 1		Level 2		Level 3		Total
Financial assets
Financial assets at fair value through profit or loss:		21,955,428		34,747,715		17,901,476		74,604,619
Due from financial institutions		—		54,538		49,030		103,568
Debt securities		19,968,123		34,084,780		15,874,678		69,927,581
Equity securities		1,898,293		607,849		1,801,371		4,307,513
Loans		—		548		176,397		176,945
Others		89,012		—		—		89,012
Derivatives held for trading		70,432		7,602,516		99,345		7,772,293
Derivatives held for hedging		—		423,011		—		423,011
Financial assets at fair value through other comprehensive income:		33,813,144		44,774,680		1,495,740		80,083,564
Debt securities		33,218,104		43,638,205		—		76,856,309
Equity securities		595,040		444,808		1,495,740		2,535,588
Loans		—		691,667		—		691,667

		55,839,004		87,547,922		19,496,561		162,883,487

Financial liabilities
Financial liabilities at fair value through profit or loss		2,771,385		—		—		2,771,385
Financial liabilities designated at fair value through profit or loss		52,175		1,150,649		8,070,210		9,273,034
Derivatives held for trading		221,685		6,814,132		648,931		7,684,748
Derivatives held for hedging		—		315,009		—		315,009

		3,045,245		8,279,790		8,719,141		20,044,176

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.1.2.1 Fair value hierarchy of financial assets and liabilities at fair value in the consolidated statements of financial position (cont’d)


(In millions of Korean won)	December 31, 2022
	Fair value hierarchy						Total
	Level 1		Level 2		Level 3		Total
Financial assets
Financial assets at fair value through profit or loss:		18,209,969		35,208,843		16,673,685		70,092,497
Due from financial institutions		—		24,444		45,025		69,469
Debt securities		16,240,223		34,425,619		15,233,555		65,899,397
Equity securities		1,879,740		414,291		1,246,032		3,540,063
Loans		—		344,489		149,073		493,562
Others		90,006		—		—		90,006
Derivatives held for trading		182,019		8,678,896		123,256		8,984,171
Derivatives held for hedging		—		462,409		—		462,409
Financial assets at fair value through other comprehensive income:		32,141,450		45,933,688		1,458,280		79,533,418
Debt securities		31,528,524		45,119,829		—		76,648,353
Equity securities		612,926		264,587		1,458,280		2,335,793
Loans		—		549,272		—		549,272

		50,533,438		90,283,836		18,255,221		159,072,495

Financial liabilities
Financial liabilities at fair value through profit or loss		2,193,210		—		—		2,193,210
Financial liabilities designated at fair value through profit or loss		35,687		1,811,404		8,231,303		10,078,394
Derivatives held for trading		442,042		7,984,424		783,071		9,209,537
Derivatives held for hedging		—		300,232		—		300,232

		2,670,939		10,096,060		9,014,374		21,781,373

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.1.2.1 Fair value hierarchy of financial assets and liabilities at fair value in the consolidated statements of financial position (cont’d)

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 June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Fair value		Valuation techniques	Inputs
Financial assets
Financial assets at fair value through profit or loss:		34,747,715
Due from financial institutions		54,538	DCF Model, Hull-white Model	Projected cash flow, Discount rate, Volatility, Correlation coefficient
Debt securities		34,084,780	DCF Model, Closed Form, MonteCarlo Simulation, Black-Scholes Model, Hull-white Model, Net Asset Value Method, Binomial Model, and others	Projected cash flow, Fair value of underlying asset, Dividend yield, Price of underlying asset, Interest rate, Discount rate, Volatility, Correlation coefficient, and others
Equity securities		607,849	DCF Model	Interest rate, Discount rate, and others
Loans		548	DCF Model	Interest rate, Discount rate, and others
Derivatives held for trading		7,602,516	DCF Model, Closed Form, FDM, MonteCarlo Simulation, Black-Scholes Model, Hull-white Model, Binomial Model, Option Model and others	Price of underlying asset, Underlying asset index, Interest rate, Dividend yield, Volatility, Foreign exchange rate, Discount rate, and others
Derivatives held for hedging		423,011	DCF Model, Closed Form, FDM	Projected cash flow, Discount rate, Forward exchange rate, Volatility, Foreign exchange rate, CRS interest rate, and others
Financial assets at fair value through other comprehensive income:		44,774,680
Debt securities		43,638,205	DCF Model, Option Model	Underlying asset index, Discount rate, and others
Equity securities		444,808	DCF Model	Discount rate
Loans		691,667	DCF Model	Discount rate

		87,547,922

Financial liabilities
Financial liabilities designated at fair value through profit or loss		1,150,649	DCF Model, Closed Form, MonteCarlo Simulation, Black-Scholes Model, Hull-white Model, Binomial Model, Net Asset Value Method	Price of underlying asset, Interest rate, Dividend yield, Volatility, Discount rate
Derivatives held for trading		6,814,132	DCF Model, Closed Form, MonteCarlo Simulation, Black-Scholes Model, Hull-white Model, Binomial Model and others	Interest rate, Price of underlying asset, Foreign exchange rate, Credit spread, Discount rate, Volatility, and others
Derivatives held for hedging		315,009	DCF Model, Closed Form, FDM	Projected cash flow, Discount rate, Forward exchange rate, Volatility, Foreign exchange rate, risk-free interest rate and others

		8,279,790

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.1.2.1 Fair value hierarchy of financial assets and liabilities at fair value in the consolidated statements of financial position (cont’d)


(In millions of Korean won)	December 31, 2022
	Fair value		Valuation techniques	Inputs
Financial assets
Financial assets at fair value through profit or loss:		35,208,843
Due from financial institutions		24,444	DCF Model, Hull-white Model	Projected cash flow, Discount rate, Volatility, Correlation coefficient
Debt securities		34,425,619	DCF Model, Closed Form, MonteCarlo Simulation Model, Black-Scholes Model, Hull-white Model, Net Asset Value Method, Binomial Model, and others	Projected cash flow, Fair value of transferred asset, Dividend yield, Price of underlying asset, Interest rate, Discount rate, Volatility, Correlation coefficient, and others
Equity securities		414,291	DCF Model	Interest rate, Discount rate, and others
Loans		344,489	DCF Model	Interest rate, Discount rate, and others
Derivatives held for trading		8,678,896	DCF Model, Closed Form, FDM, MonteCarlo Simulation, Black-Scholes Model, Hull-white Model, Binomial Model, Option Model and others	Price of underlying asset, Underlying asset index, interest rate, Dividend yield, Volatility, Foreign exchange rate, Discount rate, and others
Derivatives held for hedging		462,409	DCF Model, Closed Form, FDM	Projected cash flow, Discount rate, Forward exchange rate, Volatility, Foreign exchange rate, CRS interest rate and others
Financial assets at fair value through other comprehensive income:		45,933,688
Debt securities		45,119,829	DCF Model, Option Model	Underlying asset index, Discount rate, and others
Equity securities		264,587	DCF Model	Discount rate
Loans		549,272	DCF Model	Discount rate

		90,283,836

Financial liabilities
Financial liabilities designated at fair value through profit or loss		1,811,404	DCF Model, Closed Form, MonteCarlo Simulation Model, Black-Scholes Model, Hull-white Model, Binomial Model, Net Asset Value Model	Price of underlying asset, Interest rate, Dividend yield, Volatility, Discount rate
Derivatives held for trading		7,984,424	DCF Model, Closed Form, MonteCarlo Simulation Model, Black-Scholes Model, Hull-white Model, Binomial Model, and others	Interest rate, Price of underlying asset, Foreign exchange rate, Credit spread, Discount rate, Volatility, and others
Derivatives held for hedging		300,232	DCF Model, Closed Form, FDM	Projected cash flow, Discount rate, Forward exchange rate, Volatility, Foreign exchange rate, risk-free interest rate and others

		10,096,060

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Fair value hierarchy						Total
	Level 1		Level 2		Level 3		Total
Financial assets
Cash and due from financial institutions 1		3,162,618		26,364,236		2,090,279		31,617,133
Loans measured at amortized cost		—		302,735		434,276,884		434,579,619
Securities measured at amortized cost 2		4,568,820		30,691,190		19,620		35,279,630
Other financial assets 2		—		—		21,470,146		21,470,146

		7,731,438		57,358,161		457,856,929		522,946,528

Financial liabilities
Deposits 1		—		167,561,687		228,722,473		396,284,160
Borrowings 3		—		5,460,407		63,552,127		69,012,534
Debentures		—		58,527,460		8,983,476		67,510,936
Other financial liabilities 2		—		—		42,512,230		42,512,230

		—		231,549,554		343,770,306		575,319,860


(In millions of Korean won)	December 31, 2022
	Fair value hierarchy						Total
	Level 1		Level 2		Level 3		Total
Financial assets
Cash and due from financial institutions 1		2,517,470		27,145,486		2,740,774		32,403,730
Loans measured at amortized cost		—		63,784		430,332,305		430,396,089
Securities measured at amortized cost 2		5,253,835		28,320,106		19,290		33,593,231
Other financial assets 2		—		—		10,718,383		10,718,383

		7,771,305		55,529,376		443,810,752		507,111,433

Financial liabilities
Deposits 1		—		168,920,439		224,537,840		393,458,279
Borrowings 3		—		6,088,123		65,099,007		71,187,130
Debentures		—		59,272,727		7,763,934		67,036,661
Other financial liabilities 2		—		—		26,163,138		26,163,138

		—		234,281,289		323,563,919		557,845,208

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

2	The amounts included in Level 3 are the carrying amounts which are reasonable approximations of fair value.

3	Borrowings of 11,479 million and 18,266 million included in Level 2 are the carrying amounts which are reasonable approximations of fair value as of June 30, 2023 and December 31, 2022, respectively.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.1.2.2 Fair value hierarchy of financial assets and liabilities whose fair value is disclosed (cont’d)

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 June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

June 30, 2023

Fair value

Valuation techniques

Inputs

Financial assets

Loans measured at amortized cost

302,735

DCF Model

Discount rate

Securities measured at amortized cost

30,691,190

DCF Model,

MonteCarlo Simulation

Discount rate,
Interest rate

30,993,925

Financial liabilities

Borrowings

5,448,928

DCF Model

Discount rate

Debentures

58,527,460

DCF Model

Discount rate

63,976,388

(In millions of Korean won)

December 31, 2022

Fair value

Valuation techniques

Inputs

Financial assets

Loans measured at amortized cost

63,784

DCF Model

Discount rate

Securities measured at amortized cost

28,320,106

DCF Model,

MonteCarlo Simulation

Discount rate,
Interest rate

28,383,890

Financial liabilities

Borrowings

6,069,857

DCF Model

Discount rate

Debentures

59,272,727

DCF Model

Discount rate

65,342,584

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.1.2.2 Fair value hierarchy of financial assets and liabilities whose fair value is disclosed (cont’d)

Valuation techniques and inputs of financial assets and liabilities classified as Level 3, and whose fair value is disclosed as of June 30, 2023 and December 31, 2022 are as follows:


(In millions of Korean won)	June 30, 2023
	Fair value		Valuation techniques		Inputs
Financial assets
Cash and due from financial institutions		2,090,279		DCF Model	Credit spread, Other spread, Interest rate
Loans measured at amortized cost		434,276,884		DCF Model	Credit spread, Other spread, Prepayment rate, Interest rate

		436,367,163

Financial liabilities
Deposits		228,722,473		DCF Model	Other spread, Prepayment rate, Interest rate
Borrowings		63,552,127		DCF Model	Other spread, Interest rate
Debentures		8,983,476		DCF Model	Other spread, Interest rate

		301,258,076


(In millions of Korean won)	December 31, 2022
	Fair value		Valuation techniques		Inputs
Financial assets
Cash and due from financial institutions		2,740,774		DCF Model	Credit spread, Other spread, Interest rate
Loans measured at amortized cost		430,332,305		DCF Model	Credit spread, Other spread, Prepayment rate, Interest rate

		433,073,079

Financial liabilities
Deposits		224,537,840		DCF Model	Other spread, Prepayment rate, Interest rate
Borrowings		65,099,007		DCF Model	Other spread, Interest rate
Debentures		7,763,934		DCF Model	Other spread, Interest rate

		297,400,781

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.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Financial assets at fair value through profit or loss							Financial investments					Financial liabilities at fair value through profit or loss			Net derivative financial instruments
	Due from financial institutions measured at fair value through profit or loss		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			Loans measured at fair value through other comprehensive income		Financial liabilities designated at fair value through profit or loss			Derivatives held for trading
Beginning		45,025		16,479,588			149,074		1,458,280			—		(8,231,303	)		(659,816	)
Total gains or losses:
Profit or loss		4,005		583,672			27,323		—			—		(523,798	)		89,520
Other comprehensive income (loss)		—		1			—		(45,595	)		—		(39,140	)		—
Purchases		—		1,808,949			—		83,055			—		—			5,669
Sales		—		(1,180,510	)		—		—			—		—			(13,935	)
Issues		—		—			—		—			—		(1,903,231	)		(3,920	)
Settlements		—		—			—		—			—		2,627,262			32,896
Transfers into Level 3 *		—		—			—		—			—		—			—
Transfers out of Level 3 *		—		(15,651	)		—		—			—		—			—

Ending		49,030		17,676,049			176,397		1,495,740			—		(8,070,210	)		(549,586	)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.2.2.1 Changes in financial instruments classified as Level 3 of the fair value hierarchy for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2022
	Financial assets at fair value through profit or loss									Financial investments						Financial liabilities at fair value through profit or loss			Net derivative financial instruments
	Due from financial institutions measured at fair value through profit or loss			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			Loans measured at fair value through other comprehensive income			Financial liabilities designated at fair value through profit or loss			Derivatives held for trading
Beginning		72,016			13,677,260			93,929			1,434,567			13,970			(7,817,514	)		35,405
Total gains or losses:
Profit or loss		(2,963	)		48,683			(574	)		—			—			581,553			(582,996	)
Other comprehensive income (loss)		—			(24,351	)		—			144,223			6			15,531			—
Purchases		12,887			3,310,540			34,726			22,452			—			—			12,809
Sales		(33,843	)		(1,531,143	)		—			(20,000	)		(4,100	)		—			(57,718	)
Issues		—			42,853			—			—			—			(2,779,750	)		(11,391	)
Settlements		—			(61,055	)		—			—			—			1,426,472			16,028
Transfers into Level 3 *		—			7,556			—			—			—			—			—
Transfers out of Level 3 *		—			(15,317	)		—			—			—			—			—

Ending		48,097			15,455,026			128,081			1,581,242			9,876			(8,573,708	)		(587,863	)

*	Transfers into or out of Level 3 of the fair value hierarchy occurred due to the change in the availability of observable market data.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 six-month periods ended June 30, 2023 and 2022, are as follows:

(In millions of Korean won)


	2023						2022
	Net gains on financial instruments at fair value through profit or loss		Other operating income		Net interest income		Net losses on financial instruments at fair value through profit or loss			Other operating income		Net interest income
Total gains (losses) recognized in profit or loss for the period		65,762		114,960		—		(183,784	)		227,487		—
Total gains (losses) recognized in profit or loss from financial instruments held at the end of the reporting period		196,695		111,282		—		(166,897	)		222,075		—

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.2.3 Sensitivity analysis of changes in unobservable inputs

6.2.3.1 Information about fair value measurements using unobservable inputs as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

June 30, 2023

Fair value

Valuation techniques

Unobservable inputs

Range of
unobservable
inputs (%)

Relationship of

unobservable inputs to fair
value

Financial assets

Financial assets at fair value through profit or loss:

Due from financial institutions

49,030

Hull-white Model

Interest rate

2.40

The lower the interest rate, the higher the fair value

Debt securities

15,874,678

DCF Model, Closed Form, FDM, MonteCarlo Simulation, Hull-white Model, Black-Scholes Model, Option Model, Binomial Model, Net Asset Value Method, Milestone Method, Income Approach, Market Value Approach, and others

Growth rate

1.00 ~ 3.00

The higher the growth rate, the higher the fair value

Volatility

0.17 ~ 43.00

The higher the volatility, the higher the fair value fluctuation

Discount rate

1.44 ~ 12.64

The lower the discount rate, the higher the fair value

Volatility of stock price

22.02 ~ 32.96

The higher the volatility, the higher the fair value

Correlation coefficient between underlying assets

-60.21 ~ 89.33

The higher the correlation coefficient, the higher the fair value fluctuation

Liquidation value

-1.00 ~ 1.00

The higher the liquidation value, the higher the fair value

Recovery rate

40.00

The higher the recovery rate, the higher the fair value

Rate of real estate price fluctuation

-1.00 ~ 1.00

The higher the sale price of real estate, the higher the fair value

Equity securities

1,801,371

Income Approach, Market Value Approach, Asset Value Approach, DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method, Dividend Discount Model, Usage of Past Transactions, Binomial Model, and others

Growth rate

0.00 ~ 3.00

The higher the growth rate, the higher the fair value

Discount rate

2.15 ~ 23.00

The lower the discount rate, the higher the fair value

Volatility

0.54 ~ 47.00

The higher the volatility, the higher the fair value fluctuation

Loans

176,397

DCF Model

Discount rate

9.60

The lower the discount rate, the higher the fair value

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.2.3.1 Information about fair value measurements using unobservable inputs as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)

(In millions of Korean won)

June 30, 2023

Fair value

Valuation techniques

Unobservable inputs

Range of
unobservable
inputs (%)

Relationship of

unobservable inputs to fair
value

Derivatives held for trading:

Stock and index

75,111

DCF Model, Closed Form, FDM, MonteCarlo Simulation, Hull-white Model, Black-Scholes Model, Binomial Model, Net Asset Value Method

Volatility of underlying asset

15.48 ~ 59.50

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient

-60.21 ~ 77.92

The higher the correlation coefficient, the higher the fair value fluctuation

Currency, interest rate, and others

24,234

DCF Model, Hull-white Model, MonteCarlo Simulation, Closed Form

Volatility

9.33 ~ 31.22

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient

60.81 ~ 83.30

The higher the correlation coefficient, the higher the fair value fluctuation

Financial assets at fair value through other comprehensive income:

Equity securities

1,495,740

DCF Model, Comparable Company Analysis, Risk Adjusted Discount Rate Method, IMV Model, Income Approach, Net Asset Value Method, Market Value Approach, Tree Model, MonteCarlo Simulation, and others

Growth rate

0.00 ~ 2.00

The higher the growth rate, the higher the fair value

Discount rate

8.17 ~ 20.02

The lower the discount rate, the higher the fair value

Volatility

17.37 ~ 24.12

The higher the volatility, the higher the fair value fluctuation

19,496,561

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.2.3.1 Information about fair value measurements using unobservable inputs as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)

(In millions of Korean won)

June 30, 2023

Fair value

Valuation techniques

Unobservable inputs

Range of
unobservable
inputs (%)

Relationship of

unobservable inputs to fair
value

Financial liabilities

Financial liabilities designated at fair value through profit or loss:

Derivative-linked securities

8,070,210

DCF Model, Closed Form, MonteCarlo Simulation, Black-Scholes Model, Hull-white Model, Net Asset Value Method, and others

Volatility of underlying asset

7.00 ~ 116.38

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient

-60.21 ~ 89.33

The higher the correlation coefficient, the higher the fair value fluctuation

Derivatives held for trading:

Stock and index

282,846

DCF Model, Closed Form, MonteCarlo Simulation, Black-Scholes Model, Hull-white Model, Net Asset Value Method, and others

Volatility of underlying asset

15.48 ~ 59.50

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient

-60.21 ~ 77.92

The higher the correlation coefficient, the higher the fair value fluctuation

Others

366,085

DCF Model, Hull-white Model, MonteCarlo Simulation, Closed Form

Discount rate

4.98 ~ 5.85

The lower the discount rate, the higher the fair value

Volatility of underlying asset

7.23 ~ 116.38

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient between underlying assets

-48.96 ~ 83.30

The higher the correlation coefficient, the higher the fair value fluctuation

8,719,141

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.2.3.1 Information about fair value measurements using unobservable inputs as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)

(In millions of Korean won)

December 31, 2022

Fair value

Valuation techniques

Unobservable inputs

Range of
unobservable
inputs (%)

Relationship of

unobservable inputs to fair
value

Financial assets

Financial assets at fair value through profit or loss:

Due from financial institutions

45,025

Hull-white Model

Interest rate

0.86

The lower the interest rate, the higher the fair value

Debt securities

15,233,555

DCF Model, Closed Form, MonteCarlo Simulation, Hull-white Model, Black-Scholes Model, Option Model, Binomial Model, Net Asset Value Method, Milestone Method, Income Approach, Market Value Approach, and others

Growth rate

0.00 ~ 3.00

The higher the growth rate, the higher the fair value

Volatility

0.24 ~ 37.39

The higher the volatility, the higher the fair value fluctuation

Discount rate

1.54 ~15.75

The lower the discount rate, the higher the fair value

Correlation coefficient between underlying assets

-60.10 ~ 93.32

The higher the correlation coefficient, the higher the fair value fluctuation

Liquidation value

-1.00 ~ 1.00

The higher the liquidation value, the higher the fair value

Recovery rate

40.00

The higher the recovery rate, the higher the fair value

Rate of real estate price fluctuation

-1.00 ~ 1.00

The higher the sale price of real estate, the higher the fair value

Volatility of stock price

18.87 ~ 19.48

The higher the volatility, the higher the fair value fluctuation

Equity securities

1,246,032

Growth rate

0.00 ~ 4.00

The higher the growth rate, the higher the fair value

Discount rate

8.00 ~ 23.00

The lower the discount rate, the higher the fair value

Volatility of stock price

16.80 ~ 25.50

The higher the volatility, the higher the fair value fluctuation

Loans

149,073

DCF Model

Discount rate

9.91

The lower the discount rate, the higher the fair value

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.2.3.1 Information about fair value measurements using unobservable inputs as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)

(In millions of Korean won)

December 31, 2022

Fair value

Valuation techniques

Unobservable inputs

Range of
unobservable
inputs (%)

Relationship of

unobservable inputs to fair
value

Derivatives held for trading:

Stock and index

79,297

DCF Model, Closed Form, FDM, MonteCarlo Simulation, Hull-white Model, Black-Scholes Model, Binomial Model, Net Asset Value

Volatility of underlying asset

10.00 ~ 58.84

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient

-60.10 ~ 79.72

The higher the correlation coefficient, the higher the fair value fluctuation

Currency, interest rate, and others

43,959

DCF Model, Hull-white Model, MonteCarlo Simulation, Closed Form

Volatility

9.77 ~ 32.92

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient

8.42 ~ 93.32

The higher the correlation coefficient, the higher the fair value fluctuation

Financial assets at fair value through other comprehensive income:

Equity securities

1,458,280

Risk Adjusted Discount Rate Method, IMV Model, DCF Model, Comparable Company Analysis, Dividend Discount Model, Net Asset Value Method, Market Value Approach, Income Approach and others

Growth rate

0.00 ~ 2.00

The higher the growth rate, the higher the fair value

Discount rate

7.96 ~ 19.14

The lower the discount rate, the higher the fair value

Volatility

23.36 ~25.49

The higher the volatility, the higher the fair value fluctuation

Volatility of interest rate

56.32 ~ 121.17

The higher the volatility, the higher the fair value fluctuation

18,255,221

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.2.3.1 Information about fair value measurements using unobservable inputs as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)

(In millions of Korean won)

December 31, 2022

Fair value

Valuation techniques

Unobservable inputs

Range of
unobservable
inputs (%)

Relationship of

unobservable inputs to fair
value

Financial liabilities

Financial liabilities designated at fair value through profit or loss:

Derivative-linked securities

8,231,303

DCF Model, Closed Form, FDM, MonteCarlo Simulation, Hull-white Model, Black-Scholes Model, Net Asset Valuation

Volatility of underlying asset

1.00 ~ 119.27

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient between underlying assets

-60.10 ~ 93.32

The higher the correlation coefficient, the higher the fair value fluctuation

Derivatives held for trading:

Stock and index

370,093

DCF Model, Closed Form, MonteCarlo Simulation, Hull-white Model, Black-Scholes Model, Net Asset Valuation

Volatility of underlying asset

0.09 ~ 119.27

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient between underlying assets

-60.10 ~ 79.72

The higher the correlation coefficient, the higher the fair value fluctuation

Others

412,978

DCF Model, Hull-white Model, MonteCarlo Simulation, Closed Form

Discount rate

4.83 ~ 6.85

The lower the discount rate, the higher the fair value

Volatility of underlying asset

8.68 ~ 119.27

The higher the volatility, the higher the fair value fluctuation

Correlation coefficient between underlying assets

-50.43 ~ 93.32

The higher the correlation coefficient, the higher the fair value fluctuation

9,014,374

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 (a) equity-related derivatives, currency-related derivatives, and interest rate related derivatives whose fair value changes are recognized in profit or loss, (b) financial liabilities designated at fair value through profit or loss, and (c) due from financial institutions, debt securities (including beneficiary certificates), equity securities, and loans 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 June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	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: 1
Due from financial institutions		176		(184	)		—		—
Debt securities 4		87,025		(87,824	)		—		—
Equity securities 3		39,844		(30,944	)		—		—
Loans 5		2,277		(2,058	)		—		—
Derivatives held for trading 2		12,078		(12,737	)		—		—
Financial assets at fair value through other comprehensive income:
Equity securities 3		—		—			139,024		(76,215	)

		141,400		(133,747	)		139,024		(76,215	)

Financial liabilities
Financial liabilities designated at fair value through profit or loss 1		46,915		(44,230	)		—		—
Derivatives held for trading 2		17,759		(19,545	)		—		—

		64,674		(63,775	)		—		—

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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


(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: 1
Due from financial institutions		221		(247	)		—		—
Debt securities 4		19,034		(19,765	)		—		—
Equity securities 3		34,564		(25,586	)		—		—
Loans 5		2,276		(2,055	)		—		—
Derivatives held for trading 2		18,076		(19,034	)		—		—
Financial assets at fair value through other comprehensive income:
Equity securities 3		—		—			179,307		(82,595	)

		74,171		(66,687	)		179,307		(82,595	)

Financial liabilities
Financial liabilities designated at fair value through profit or loss 1		94,001		(97,663	)		—		—
Derivatives held for trading 2		48,768		(46,427	)		—		—

		142,769		(144,090	)		—		—

For financial instruments at fair value through profit or loss, changes in fair value are calculated by shifting principal unobservable input parameters such as discount rate, recovery rate, liquidation value by ±1%p and volatility of underlying asset, growth rate by ±1%p or ±10% and correlation coefficient by ±10%.

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

3	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 (-1%p~1%p).

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 price fluctuation by -1%p~1%p, and for beneficiary certificates whose underlying assets are equity investments, changes in fair value are calculated by shifting principal unobservable input parameters such as liquidation value by -1%p~1%p and discount rate by -1%p~1%p.

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

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6.2.4 Valuation gains and losses on transaction day

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 valuation gains and losses on transaction day for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Balance at the beginning of the period		71,504			77,208
New transactions		62,086			106,425
Changes during the period		(80,002	)		(43,831	)

Balance at the end of the period		53,588			139,802

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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 June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


	June 30, 2023
	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		—		—		—		31,610,850		—		31,610,850
Financial assets at fair value through profit or loss		74,604,619		—		—		—		—		74,604,619
Derivative financial assets		7,772,293		—		—		—		423,011		8,195,304
Loans measured at amortized cost		—		—		—		434,953,555		—		434,953,555
Financial investments		—		77,547,975		2,535,589		36,885,994		—		116,969,558
Other financial assets		—		—		—		21,470,146		—		21,470,146

		82,376,912		77,547,975		2,535,589		524,920,545		423,011		687,804,032

(In millions of Korean won)


	June 30, 2023
	Financial instruments at fair value through profit or loss		Financial instruments designated 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		2,771,385		9,273,034		—		—		12,044,419
Derivative financial liabilities		7,684,748		—		—		315,009		7,999,757
Deposits		—		—		396,081,606		—		396,081,606
Borrowings		—		—		69,261,997		—		69,261,997
Debentures		—		—		68,260,644		—		68,260,644
Other financial liabilities *		—		—		42,512,230		—		42,512,230

		10,456,133		9,273,034		576,116,477		315,009		596,160,653

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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

(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		—		—		—		32,474,750		—		32,474,750
Financial assets at fair value through profit or loss		70,092,497		—		—		—		—		70,092,497
Derivative financial assets		8,984,171		—		—		—		462,409		9,446,580
Loans measured at amortized cost		—		—		—		433,038,931		—		433,038,931
Financial investments		—		77,197,625		2,335,793		35,919,241		—		115,452,659
Other financial assets		—		—		—		10,718,383		—		10,718,383

		79,076,668		77,197,625		2,335,793		512,151,305		462,409		671,223,800

(In millions of Korean won)


	December 31, 2022
	Financial instruments at fair value through profit or loss		Financial instruments designated 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		2,193,210		10,078,394		—		—		12,271,604
Derivative financial liabilities		9,209,537		—		—		300,232		9,509,769
Deposits		—		—		393,928,904		—		393,928,904
Borrowings		—		—		71,717,366		—		71,717,366
Debentures		—		—		68,698,203		—		68,698,203
Other financial liabilities *		—		—		26,163,138		—		26,163,138

	11,402,747		10,078,394		560,507,611		300,232		582,288,984

*	Other financial liabilities include lease liabilities that are not included in the category of financial instruments measured at amortized cost.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

7. Due from Financial Institutions Measured at Amortized Cost

7.1 Details of due from financial institutions as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)		Financial institutions	Interest rate (%) as of June 30, 2023	June 30, 2023		December 31, 2022
Due from financial institutions in Korean won	Due from the Bank of Korea	The Bank of Korea	—		15,992,621		15,169,704
	Due from banks	Hana Bank and others	0.00 ~ 5.60		2,808,010		3,941,987
	Due from others	NH Investment & Securities Co., Ltd. and others	0.00 ~ 4.65		1,301,758		1,509,698

					20,102,389		20,621,389

Due from financial institutions in foreign currencies	Due from banks in foreign currencies	The Bank of Korea and others	0.00 ~ 5.16		5,962,677		5,653,587
	Time deposits in foreign currencies	Bank of Communications Co., Ltd.(New York) and others	0.00 ~ 9.50		496,885		573,493
	Due from others	State Steet Bank and Trust Company(Seoul) and others	0.00 ~ 10.70		2,472,771		3,066,370
					8,932,333		9,293,450

					29,034,722		29,914,839

*	Before netting of allowance

7.2 Details of restricted due from financial institutions as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)		Financial institutions	June 30, 2023		December 31, 2022		Reasons of restriction
Due from financial institutions in Korean won	Due from the Bank of Korea	The Bank of Korea		15,992,621		15,169,704	Bank of Korea Act
	Due from banks	Shinhan Bank and others		621,398		522,306	Net settlement and others
	Due from others	NH Investment & Securities Co., Ltd. and others		1,133,050		1,113,712	Derivatives margin account and others

				17,747,069		16,805,722

Due from financial institutions in foreign currencies	Due from banks in foreign currencies	The Bank of Korea and others		1,378,376		2,350,933	Bank of Korea Act and others
	Time deposits in foreign currencies	Bank of Communications Co., Ltd.(New York) and others		95,705		72,437	Bank Act of the State of New York and others
	Due from others	State Steet Bank and Trust Company(Seoul) and others		1,821,993		2,092,655	Derivatives margin account and others

				3,296,074		4,516,025

				21,043,143		21,321,747

*	Before netting of allowance

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

7.3 Changes in allowances for credit losses of due from financial institutions for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	12-month expected credit losses			Lifetime expected credit losses
	12-month expected credit losses			Non-impaired		Impaired
Beginning		2,743			—		—
Transfer between stages:
Transfer to 12-month expected credit losses		—			—		—
Transfer to lifetime expected credit losses		—			—		—
Impairment		—			—		—
Sales		—			—		—
Reversal of credit losses		(1,321	)		—		—
Business combination		6			—		—
Others		(27	)		—		—

Ending		1,401			—		—


(In millions of Korean won)	2022
	12-month expected credit losses		Lifetime expected credit losses
	12-month expected credit losses		Non-impaired		Impaired
Beginning		2,969		—		—
Transfer between stages:
Transfer to 12-month expected credit losses		—		—		—
Transfer to lifetime expected credit losses		—		—		—
Impairment		—		—		—
Sales		—		—		—
Provision for credit losses		934		—		—
Others		207		—		—

Ending		4,110		—		—

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8. Derivative Financial Instruments and Hedge Accounting

The Group’s derivative operations focus on addressing the needs of the Group’s corporate clients to hedge their risk exposure and hedging the Group’s risk exposure that results from such client contracts. The Group also engages in derivative trading activities to hedge the interest rate risk and currency risk arising from the Group’s own assets and liabilities. In addition, the Group engages in proprietary trading of derivatives within the predetermined transaction limit.

The Group provides and trades a range of derivative financial instruments, including:

•

Interest rate swaps relating to interest rate risk in Korean won

•

Cross-currency swaps, forwards, and options relating to currency risk

•

Stock index options linked with the Korea Composite Stock Price Index (“KOSPI”)

In particular, the Group applies fair value hedge accounting using interest rate swaps, currency forwards, and others to hedge the risk of changes in fair value due to the changes in interest rate and foreign exchange rate of structured debentures in Korean won, debentures in foreign currencies, structured deposits in foreign currencies, and others. The Group applies cash flow hedge accounting using interest rate swaps, currency swaps, and others to hedge the risk of changes in cash flows of floating rate debt securities in Korean won, borrowings in foreign currencies, group of loans measured at amortized cost, and others. In addition, the Group applies net investments in foreign operations hedge accounting by designating debentures in foreign currencies and cross currency forwards as hedging instruments to hedge the currency risk of net investments in foreign operations.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8.1 Details of derivative financial instruments held for trading as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


	June 30, 2023						December 31, 2022
	Notional amount		Assets		Liabilities		Notional amount		Assets		Liabilities
Interest rate
Forwards		14,883,655		879,208		486,098		8,261,663		821,603		431,002
Futures *		7,437,541		2,320		1,145		4,450,505		765		256
Swaps		435,997,241		846,098		714,552		359,581,194		859,670		694,713
Options		9,704,000		259,536		255,532		10,508,000		274,596		272,284

		468,022,437		1,987,162		1,457,327		382,801,362		1,956,634		1,398,255

Currency
Forwards		118,028,418		1,778,211		1,283,619		115,682,577		2,813,603		2,472,119
Futures *		730,163		731		1,820		413,960		36		2,364
Swaps		92,867,797		3,434,909		4,004,688		91,646,725		3,525,458		4,049,390
Options		1,396,448		11,827		6,256		1,852,065		27,258		13,025

		213,022,826		5,225,678		5,296,383		209,595,327		6,366,355		6,536,898

Stock and index
Futures *		2,035,518		10,748		13,962		1,828,302		37,455		89,624
Swaps		5,698,689		337,608		342,624		6,649,735		377,840		492,275
Options		6,533,524		141,412		280,475		7,257,715		168,311		359,274

		14,267,731		489,768		637,061		15,735,752		583,606		941,173

Credit
Swaps		3,116,945		20,557		9,500		3,006,114		32,860		17,468

		3,116,945		20,557		9,500		3,006,114		32,860		17,468

Commodity
Futures *		22,160		2,252		201		28,577		1,970		941
Swaps		32,210		1,318		1,316		—		—		—
Options		56,759		675		680		131,500		887		885

		111,129		4,245		2,197		160,077		2,857		1,826

Others		1,289,067		44,882		282,281		1,003,301		41,859		313,917

		699,830,135		7,772,292		7,684,749		612,301,933		8,984,171		9,209,537

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

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8.2 Average price conditions of future nominal cash flows by type of hedge accounting as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	1 year		2 years		3 years		4 years		5 years		Over 5 years		Total
Fair value hedge
Nominal amount of the hedging instrument		4,854,008		3,645,106		1,549,207		1,058,747		172,239		2,213,239		13,492,546
Average price condition (%)		4.09		4.96		4.83		4.78		5.86		4.81		4.60
Average price condition (KRW/USD)		1,312.78		1,312.79		1,312.80		—		—		—		1,312.79
Average price condition (KRW/EUR)		1,360.93		1,426.53		—		1,426.55		—		—		1,426.52
Average price condition (KRW/AUD)		869.01		869.01		—		—		—		—		869.01
Average price condition (KRW/GBP)		1,655.51		—		1,655.51		—		—		—		1,655.51
Cash flow hedge
Nominal amount of the hedging instrument		1,775,668		1,719,741		2,154,977		736,267		1,137,562		210,000		7,734,215
Average price condition (%)		3.80		7.91		9.12		3.96		6.15		3.99		7.08
Average price condition (KRW/USD)		1,179.69		1,198.52		1,230.22		1,243.07		1,148.76		—		1,205.48
Average price condition (KRW/EUR)		—		1,369.14		—		—		1,392.00		—		1,372.29
Average price condition (KRW/AUD)		—		853.40		889.00		—		—		—		866.92
Average price condition (KRW/SGD)		866.14		—		—		—		—		—		866.14
Hedge of net investments in foreign operations
Nominal amount of the hedging instrument		60,427		—		—		211,361		—		—		271,788
Average price condition (KRW/USD)		1,071.00		—		—		1,178.91		—		—		1,165.26
Average price condition (KRW/GBP)		1,465.26		—		—		—		—		—		1,465.26

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8.2 Average price conditions of future nominal cash flows by type of hedge accounting as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(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		5,677,321		1,921,072		2,701,675		1,883,332		426,551		2,147,845		14,757,796
Average price condition (%)		4.17		4.52		4.64		4.56		4.36		4.64		4.43
Average price condition (KRW/USD)		1,197.01		1,262.56		1,276.70		—		—		—		1,240.59
Average price condition (KRW/EUR)		1,363.42		1,373.32		—		1,436.86		—		—		1,387.71
Average price condition (KRW/AUD)		886.23		895.76		—		—		—		—		890.17
Average price condition (KRW/GBP)		1,617.02		—		1,535.25		—		—		—		1,537.85
Cash flow hedge
Nominal amount of the hedging instrument		3,033,420		892,720		1,846,139		771,585		1,078,676		210,000		7,832,540
Average price condition (%)		2.90		2.60		4.42		4.62		4.95		3.99		3.54
Average price condition (KRW/USD)		1,178.13		1,196.80		1,166.24		1,225.35		1,252.61		—		1,202.02
Average price condition (KRW/EUR)		1,321.00		1,364.00		1,374.73		—		—		—		1,362.51
Average price condition (KRW/AUD)		—		856.40		851.50		—		—		—		853.40
Average price condition (KRW/SGD)		866.14		—		—		—		—		—		866.14
Hedge of net investments in foreign operations
Nominal amount of the hedging instrument		65,012		27,499		—		—		—		—		92,511
Average price condition (KRW/USD)		1,071.00		—		—		—		—		—		1,071.00
Average price condition (KRW/GBP)		—		1,465.26		—		—		—		—		1,465.26

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8.3 Fair Value Hedge

8.3.1 Details of fair value hedged items as of June 30, 2023 and December 31, 2022 and changes in fair value for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)		June 30, 2023										2023
		Carrying amount				Accumulated amount of hedge adjustments						Changes in fair value
		Assets		Liabilities		Assets			Liabilities			Changes in fair value
Hedge accounting
Interest rate	Debt securities in Korean won		1,936,246		—		(81,756	)		—			18,313
	Debt securities in foreign currencies		2,715,487		—		(190,718	)		—			14,940
	Deposits in Korean won		—		49,233		—			(767	)		767
	Deposits in foreign currencies		—		30,530		—			(8,855	)		263
	Debentures in Korean won		—		5,435,524		—			(204,476	)		(38,732	)
	Debentures in foreign currencies		—		1,250,651		—			(88,405	)		(7,459	)

			4,651,733		6,765,938		(272,474	)		(302,503	)		(11,908	)

Currency	Debt securities in foreign currencies		1,662,003		—		33,368			—			4,507
Currency
			1,662,003		—		33,368			—			4,507

			6,313,736		6,765,938		(239,106	)		(302,503	)		(7,401	)


(In millions of Korean won)		December 31, 2022										2022
		Carrying amount				Accumulated amount of hedge adjustments						Changes in fair value
		Assets		Liabilities		Assets			Liabilities			Changes in fair value
Hedge accounting
Interest rate	Debt securities in Korean won		2,467,171		—		(107,444	)		—			(90,879	)
	Debt securities in foreign currencies		3,142,973		—		(232,085	)		—			(173,298	)
	Deposits in foreign currencies		—		29,429		—			(8,591	)		6,064
	Debentures in Korean won		—		5,690,371		—			(249,629	)		168,913
	Debentures in foreign currencies		—		1,196,781		—			(95,865	)		91,409

			5,610,144		6,916,581		(339,529	)		(354,085	)		2,209

Currency	Debt securities in foreign currencies		1,602,384		—		(79,616	)		—			202,031
Currency
			1,602,384		—		(79,616	)		—			202,031

			7,212,528		6,916,581		(419,145	)		(354,085	)		204,240

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8.3.2 Details of derivative instruments designated as fair value hedge as of June 30, 2023 and December 31, 2022 and changes in fair value for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)
	June 30, 2023						2023
	Notional amount		Carrying amount				Changes in fair value
	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		11,992,305		145,231		109,135		12,607
Currency
Forwards		1,500,241		21,487		30,468		(39,167	)

		13,492,546		166,718		139,603		(26,560	)


(In millions of Korean won)
	December 31, 2022						2022
	Notional amount		Carrying amount				Changes in fair value
	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Swaps		13,290,183		186,258		104,856		15,790
Currency
Forwards		1,467,613		37,015		29,069		(147,693	)

		14,757,796		223,273		133,925		(131,903	)

8.3.3 Details of hedge ineffectiveness recognized in profit or loss on derivative instruments designated as fair value hedge for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)
	2023			2022
Hedge accounting
Interest rate		699			17,999
Currency		(34,660	)		54,338

		(33,961	)		72,337

8.3.4 Gains or losses on fair value hedging instruments and hedged items attributable to the hedged for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Losses on hedging instruments		(32,370	)		(132,336	)
Gains (losses) on hedged items attributable to the hedged risk		(7,278	)		187,963

		(39,648	)		55,627

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8.4 Cash Flow Hedge

8.4.1 Details of cash flow hedged items as of June 30, 2023 and December 31, 2022 and changes in fair value for the six-month periods ended June 30, 2023 and 2022, are as follows:

(In millions of Korean won)


	Cash flow hedge reserve						Changes in fair value
	June 30, 2023			December 31, 2022			2023			2022
Hedge accounting
Interest rate risk		40,992			46,234			15,824			(53,772	)
Currency risk		(35,592	)		(26,602	)		(17,038	)		20,352

		5,400			19,632			(1,214	)		(33,420	)

8.4.2 Details of derivative instruments designated as cash flow hedge as of June 30, 2023 and December 31, 2022 and changes in fair value for the six-month periods ended June 30, 2023 and 2022, are as follows:

(In millions of Korean won)


	June 30, 2023						2023
	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Forwards		603,767		14,880		57,766		4,671
Swaps		3,535,701		95,544		221		(1,498	)
Currency
Swaps		3,594,747		145,870		108,352		(4,874	)

		7,734,215		256,294		166,339		(1,701	)

(In millions of Korean won)


	December 31, 2022						2022
	Notional amount		Assets		Liabilities		Changes in fair value
Interest rate
Forwards		1,079,652		20,200		56,753		(4,038	)
Swaps		3,231,288		101,975		124		54,028
Currency
Swaps		3,521,600		116,961		98,237		22,737

		7,832,540		239,136		155,114		72,727

8.4.3 Gains or losses on cash flow hedging instruments and hedged items attributable to the hedged risk for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Gains (losses) on hedging instruments:		(1,701	)		72,727
Effective portion of gains (losses) on cash flow hedging instruments (recognized in other comprehensive income or loss)		(2,940	)		68,090
Ineffective portion of gains on cash flow hedging instruments (recognized in profit or loss)		1,239			4,637

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8.4.4 Amounts recognized in other comprehensive income (loss) and reclassified from equity to profit or loss related to derivative instruments designated as cash allow hedge for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Other comprehensive income (loss)		(2,940	)		68,090
Reclassification to profit or loss		(10,417	)		(26,882	)
Income tax effect		(875	)		(19,977	)

		(14,232	)		21,231

8.5 Hedge of Net Investments in Foreign Operations

8.5.1 Details of net investments in foreign operations hedged items as of June 30, 2023 and December 31, 2022 and changes in fair value for the six-month periods ended June 30, 2023 and 2022, are as follows:

(In millions of Korean won)


	Foreign currency translation reserve						Changes in fair value
	June 30, 2023			December 31, 2022			2023		2022
Hedge accounting
Currency risk		(154,138	)		(114,742	)		53,535		129,271

8.5.2 Details of financial instruments designated as hedge of net investments in foreign operations as of June 30, 2023 and December 31, 2022 and changes in fair value for the six-month periods ended June 30, 2023 and 2022, are as follows:

(In millions of Korean won)


	June 30, 2023						2023
	Notional amount		Assets		Liabilities		Changes in fair value
Currency
Forwards		271,788		—		9,066		(4,946	)
Swaps		—		—		—		512
Debentures in foreign currencies		1,444,080		—		1,444,080		(49,101	)

		1,715,868		—		1,453,146		(53,535	)

(In millions of Korean won)


	December 31, 2022						2022
	Notional amount		Assets		Liabilities		Changes in fair value
Currency
Forwards		92,511		—		11,193		(13,923	)
Debentures in foreign currencies		1,361,080		—		1,361,080		(115,348	)

		1,453,591		—		1,372,273		(129,271	)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

8.5.3 Fair value of non-derivative financial instruments designated as hedge of net investments in foreign operations as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Debentures in foreign currencies		1,290,364		1,211,215

8.5.4 Gains or losses on net investments in foreign operations hedging instruments and hedged items attributable to the hedged risk for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Losses on hedging instruments:		(53,535	)		(129,271	)
Effective portion of losses on hedge of net investments in foreign operations (recognized in other comprehensive income or loss)		(53,535	)		(129,271	)
Ineffective portion of losses on hedge of net investments in foreign operations (recognized in profit or loss)		—			—

8.5.5 Effective portion of gains or losses on net investments in foreign operations hedging instruments recognized in other comprehensive income (loss) for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Other comprehensive loss		(53,535	)		(129,271	)
Reclassification to profit or loss		—			—
Income tax effect		14,139			33,288

		(39,396	)		(95,983	)

8.6 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.

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

9. Loans Measured at Amortized Cost

9.1 Details of loans as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Loans measured at amortized cost		439,209,573			436,647,081
Deferred loan origination fees and costs		556,922			552,834
Less: Allowances for credit losses		(4,812,940	)		(4,160,984	)

		434,953,555			433,038,931

9.2 Details of loans to banks as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Loans measured at amortized cost		11,607,107			9,751,737
Less: Allowances for credit losses		(3,030	)		(1,951	)

		11,604,077			9,749,786

9.3 Details of loan types and customer types of loans to customers other than banks as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Retail			Corporate			Credit card			Total
Loans in Korean won		174,952,159			182,161,157			—			357,113,316
Loans in foreign currencies		5,099,185			25,822,458			—			30,921,643
Domestic import usance bills		—			4,679,873			—			4,679,873
Off-shore funding loans		—			758,380			—			758,380
Call loans		—			249,405			—			249,405
Bills bought in Korean won		—			1,953			—			1,953
Bills bought in foreign currencies		—			1,618,186			—			1,618,186
Guarantee payments under acceptances and guarantees		1			27,447			—			27,448
Credit card receivables in Korean won		—			—			21,903,826			21,903,826
Credit card receivables in foreign currencies		—			—			48,317			48,317
Bonds purchased under repurchase agreements		—			2,364,172			—			2,364,172
Privately placed bonds		—			966,832			—			966,832
Factored receivables		117			4			—			121
Lease receivables		489,357			434,148			—			923,505
Loans for installment credit		6,028,871			553,540			—			6,582,411

		186,569,690			219,637,555			21,952,143			428,159,388

Proportion (%)		43.57			51.30			5.13			100.00
Less: Allowances for credit losses		(1,323,343	)		(2,581,209	)		(905,358	)		(4,809,910	)

		185,246,347			217,056,346			21,046,785			423,349,478

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

9.3 Details of loan types and customer types of loans to customers other than banks as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)	December 31, 2022
	Retail			Corporate			Credit card			Total
Loans in Korean won		177,278,504			177,766,170			—			355,044,674
Loans in foreign currencies		4,667,895			26,052,080			—			30,719,975
Domestic import usance bills		—			4,499,072			—			4,499,072
Off-shore funding loans		—			908,266			—			908,266
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		1			18,459			—			18,460
Credit card receivables in Korean won		—			—			22,562,217			22,562,217
Credit card receivables in foreign currencies		—			—			47,376			47,376
Bonds purchased under repurchase agreements		—			3,151,157			—			3,151,157
Privately placed bonds		—			719,079			—			719,079
Factored receivables		111			5			—			116
Lease receivables		576,165			558,318			—			1,134,483
Loans for installment credit		5,915,223			542,413			—			6,457,636

		188,437,899			216,400,686			22,609,593			427,448,178

Proportion (%)		44.08			50.63			5.29			100.00
Less: Allowances for credit losses		(1,337,366	)		(1,983,825	)		(837,842	)		(4,159,033	)

		187,100,533			214,416,861			21,771,751			423,289,145

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

10. Allowances for Credit Losses

10.1 Changes in allowances for credit losses of loans measured at amortized cost for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Retail									Corporate									Credit card
	12-month expected credit losses			Lifetime expected credit losses						12-month expected credit losses			Lifetime expected credit losses						12-month expected credit losses			Lifetime expected credit losses
	12-month expected credit losses			Non- impaired			Impaired			12-month expected credit losses			Non- impaired			Impaired			12-month expected credit losses			Non- impaired			Impaired
Beginning		602,037			284,816			450,513			522,552			561,936			901,288			163,185			354,315			320,342
Transfer between stages:
Transfer to 12-month expected credit losses		91,029			(88,463	)		(2,566	)		83,929			(75,845	)		(8,084	)		80,201			(77,860	)		(2,341	)
Transfer to lifetime expected credit losses		(70,118	)		92,841			(22,723	)		(66,347	)		99,663			(33,316	)		(20,326	)		21,768			(1,442	)
Impairment		(7,827	)		(62,218	)		70,045			(4,705	)		(75,483	)		80,188			(2,039	)		(32,746	)		34,785
Write-offs		—			—			(337,062	)		—			(1	)		(113,211	)		—			—			(275,640	)
Sales		(837	)		(460	)		(11,418	)		—			(229	)		(14,223	)		—			—			—
Provision (reversal) for credit losses 1,2		(50,598	)		61,578			313,799			259,077			163,069			255,571			(20,723	)		33,341			349,565
Others (exchange differences, etc.)		1,467			681			8,827			(1,972	)		2,029			48,353			172			—			(19,199	)

Ending		565,153			288,775			469,415			792,534			675,139			1,116,566			200,470			298,818			406,070

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

10.1 Changes in allowances for credit losses of loans measured at amortized cost for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2022
	Retail									Corporate									Credit card
	12-month expected credit losses			Lifetime expected credit losses						12-month expected credit losses			Lifetime expected credit losses						12-month expected credit losses			Lifetime expected credit losses
	12-month expected credit losses			Non- impaired			Impaired			12-month expected credit losses			Non- impaired			Impaired			12-month expected credit losses			Non- impaired			Impaired
Beginning		474,475			242,819			288,912			448,084			477,993			960,964			175,168			322,649			294,327
Transfer between stages:
Transfer to 12-month expected credit losses		78,655			(77,075	)		(1,580	)		82,540			(81,219	)		(1,321	)		49,553			(46,065	)		(3,488	)
Transfer to lifetime expected credit losses		(57,507	)		72,432			(14,925	)		(48,245	)		64,055			(15,810	)		(23,534	)		24,852			(1,318	)
Impairment		(19,129	)		(53,535	)		72,664			(39,582	)		(37,354	)		76,936			(1,354	)		(24,800	)		26,154
Write-offs		—			(1	)		(222,085	)		—			(2	)		(324,339	)		—			—			(213,076	)
Sales		(778	)		(77	)		(6,474	)		—			—			(10,365	)		—			—			—
Provision (reversal) for credit losses 1,2		52,248			61,075			194,870			49,501			61,471			15,186			(17,833	)		55,220			209,936
Others (exchange differences, etc.)		386			795			1,210			4,687			6,038			(5,305	)		(116	)		—			(7,285	)

Ending		528,350			246,433			312,592			496,985			490,982			695,946			181,884			331,856			305,250

Provision for credit losses in the consolidated statements of comprehensive income also includes provision (reversal) for credit losses of due from financial institutions (Note 7.3), provision (reversal) for credit losses of financial investments (Note 11.5), provision (reversal) for credit losses of unused commitments, acceptances and guarantees (Note 18.2), provision (reversal) for credit losses of financial guarantee contracts (Note 18.3), and provision (reversal) for credit losses of other financial assets.

2	Includes 163,118 million and 259,952 million of collections from written-off loans for the six-month periods ended June 30, 2023 and 2022, 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 9,762,167 million and 9,830,171 million as of June 30, 2023 and December 31, 2022, respectively.

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

10.2 Changes in gross carrying amount of loans for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	12-month expected credit losses			Lifetime expected credit losses
	12-month expected credit losses			Non-impaired			Impaired
Beginning		399,089,134			34,563,171			3,547,610
Transfer between stages:
Transfer to 12-month expected credit losses		20,088,610			(19,796,574	)		(292,036	)
Transfer to lifetime expected credit losses (non-impaired)		(21,573,449	)		22,021,948			(448,499	)
Transfer to lifetime expected credit losses (impaired)		(1,051,748	)		(1,558,627	)		2,610,375
Write-offs		—			(1	)		(725,913	)
Sales		(3,010,965	)		(35,026	)		(145,781	)
Net increase (decrease) (execution, repayment, and others)		9,757,813			(3,319,032	)		45,485

Ending		403,299,395			31,875,859			4,591,241


(In millions of Korean won)	2022
	12-month expected credit losses			Lifetime expected credit losses
	12-month expected credit losses			Non-impaired			Impaired
Beginning		381,796,028			32,788,361			3,485,825
Transfer between stages:
Transfer to 12-month expected credit losses		18,330,222			(18,228,519	)		(101,703	)
Transfer to lifetime expected credit losses (non-impaired)		(20,415,488	)		20,622,132			(206,644	)
Transfer to lifetime expected credit losses (impaired)		(412,514	)		(824,372	)		1,236,886
Write-offs		—			(3	)		(759,500	)
Sales		(3,098,796	)		(13,868	)		(72,338	)
Net increase (decrease) (execution, repayment, and others)		22,444,356			(1,648,362	)		(138,021	)

Ending		398,643,808			32,695,369			3,444,505

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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

11.1 Details of financial assets at fair value through profit or loss and financial investments as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Financial assets at fair value through profit or loss
Debt securities:
Government and public bonds		11,585,723			9,310,991
Financial bonds		11,279,702			12,509,496
Corporate bonds		6,146,998			4,983,552
Asset-backed securities		126,908			164,543
Beneficiary certificates		19,753,452			19,838,465
Derivative-linked securities		1,859,193			1,625,950
Other debt securities		19,175,605			17,466,400
Equity securities:
Stocks		3,652,283			2,926,094
Other equity securities		655,230			613,969
Loans:
Privately placed bonds		142,929			158,731
Other loans		34,016			334,831
Due from financial institutions:
Other due from financial institutions		103,568			69,469
Others		89,012			90,006

		74,604,619			70,092,497

Financial investments
Financial assets at fair value through other comprehensive income
Debt securities:
Government and public bonds		30,630,084			29,556,711
Financial bonds		22,129,814			22,009,492
Corporate bonds		22,233,931			24,134,382
Asset-backed securities		1,578,723			662,791
Other debt securities		283,757			284,977
Equity securities:					—
Stocks		1,873,521			1,907,737
Equity investments		9,559			17,096
Other equity securities		652,508			410,960
Loans:					—
Privately placed bonds		691,667			549,272

		80,083,564			79,533,418

Financial assets at amortized cost
Debt securities:
Government and public bonds		6,235,202			6,520,633
Financial bonds		12,328,245			10,965,141
Corporate bonds		9,822,398			10,642,200
Asset-backed securities		8,059,889			7,432,860
Other debt securities		454,378			363,985
Less: Allowances for credit losses		(14,118	)		(5,578	)

		36,885,994			35,919,241

		116,969,558			115,452,659

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

11.2 Dividend income from equity securities designated at fair value through other comprehensive income for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)		2023				2022
		From the equity securities derecognized		From the equity securities held		From the equity securities derecognized		From the equity securities held
Equity securities measured at fair value through other comprehensive income:
Stocks	Listed		—		1,999		—		409
	Unlisted		—		14,406		—		22,140
Other equity securities			—		13,147		—		5,231

			—		29,552		—		27,780

11.3 Derecognized equity securities measured at fair value through other comprehensive income for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)		2023				2022
		Disposal price		Accumulated other comprehensive income as of disposal date		Disposal price		Accumulated other comprehensive loss as of disposal date
Equity securities measured at fair value through other comprehensive income:
Stocks	Listed		37,295		35,961		2,175		(396	)
	Unlisted		—		—		—		—

			37,295		35,961		2,175		(396	)

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KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

11.4 Provision (reversal) for credit losses of financial investments for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Provision		Reversal			Total
Securities measured at fair value through other comprehensive income		9,812		(1,959	)		7,853
Loans measured at fair value through other comprehensive income		78		(3	)		75
Securities measured at amortized cost		9,186		(659	)		8,527

		19,076		(2,621	)		16,455


(In millions of Korean won)	2022
	Provision		Reversal			Total
Securities measured at fair value through other comprehensive income		2,802		(1,025	)		1,777
Loans measured at fair value through other comprehensive income		156		(140	)		16
Securities measured at amortized cost		1,085		(321	)		764

		4,043		(1,486	)		2,557

11.5 Changes in allowances for credit losses of financial investments for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	12-month expected credit losses			Lifetime expected credit losses
	12-month expected credit losses			Non-impaired			Impaired
Beginning		16,343			270			76
Transfer between stages:
Transfer to 12-month expected credit losses		—			—			—
Transfer to lifetime expected credit losses		—			—			—
Sales		(442	)		(270	)		—
Provision for credit losses		16,455			—			—
Others		(227	)		—			—

Ending		32,129			—			76


(In millions of Korean won)	2022
	12-month expected credit losses			Lifetime expected credit losses
	12-month expected credit losses			Non-impaired			Impaired
Beginning		18,373			28			76
Transfer between stages:								—
Transfer to 12-month expected credit losses		—			—			—
Transfer to lifetime expected credit losses		—			—			—
Sales		(387	)		(8	)		—
Provision for credit losses		2,142			415			—
Others		701			—			—

Ending		20,829			435			76

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

12. Investments in Associates and Joint Ventures

12.1 Details of investments in associates and joint ventures as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
KB-KDBC Pre-IPO New Technology Business Investment Fund 2		66.66		3,601		6,069			6,069	Investment finance	Korea
Balhae Infrastructure Company 1		12.61		96,516		91,678			88,705	Investment finance	Korea
Hahn & Company No. 4-3 Private Equity Fund		24.82		6,947		6,416			6,427	Investment finance	Korea
Aju Good Technology Venture Fund		38.47		343		18,899			18,896	Investment finance	Korea
Incheon Bridge Co., Ltd. 1		14.99		9,158		(10,865	)		—	Operation of highways and related facilities	Korea
Big Dipper Co., Ltd. 1		17.86		440		102			102	Research, consulting, and big data	Korea
Paycoms Co., Ltd. 3		12.24		800		155			156	System software publishing	Korea
Food Factory Co., Ltd. 4		22.22		1,000		652			1,440	Farm product distribution	Korea
KBSP Private Equity Fund No.4 1		14.95		6,100		2,491			2,491	Investment finance	Korea
Korea Credit Bureau Co., Ltd. 1		9.00		4,500		6,043			6,043	Credit information	Korea
KB Social Impact Investment Fund		30.00		4,500		5,036			5,036	Investment finance	Korea
KB-Solidus Global Healthcare Fund 2		43.33		25,927		32,135			32,832	Investment finance	Korea
POSCO-KB Shipbuilding Fund		31.25		1,826		4,500			4,500	Investment finance	Korea
KB-TS Technology Venture Private Equity Fund 2		56.00		9,072		12,442			12,442	Investment finance	Korea
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund 2		42.55		10,050		15,510			14,760	Investment finance	Korea
KB-SJ Tourism Venture Fund 1		18.52		4,599		3,721			3,722	Investment finance	Korea
UNION Media Commerce Fund		28.99		1,000		952			953	Investment finance	Korea
KB-Stonebridge Secondary Private Equity Fund 1		14.56		23,801		26,876			26,876	Investment finance	Korea
KB SPROTT Renewable Private Equity Fund No.1 2		37.69		17,565		15,981			16,044	Investment finance	Korea
KB-UTC Inno-Tech Venture Fund 2		44.29		19,575		16,592			16,606	Investment finance	Korea

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

12.1 Details of investments in associates and joint ventures as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)	June 30, 2023
	Ownership (%)		Acquisition cost		Share of net asset amount		Carrying amount		Industry	Location
WJ Private Equity Fund No.1		26.95		10,000		9,569		9,569	Investment finance		Korea
All Together Korea Fund No.2 5		99.99		10,000		10,386		10,386	Asset management		Korea
KB-NAU Special Situation Corporate Restructuring Private Equity Fund 1		12.00		8,691		10,636		10,637	Asset management		Korea
December & Company Inc. 1		16.78		29,951		1,777		1,778	Investment finance		Korea
2020 KB Fintech Renaissance Fund 1		5.05		550		1,086		1,086	Investment finance		Korea
KB Material and Parts No.1 PEF 1		14.47		3,400		3,325		3,325	Investment finance		Korea
FineKB Private Equity Fund No.1		25.00		10,650		8,127		8,127	Investment finance		Korea
G payment Joint Stock Company		43.84		9,374		3,486		9,465	Investment advisory and securities trading		Vietnam
KB-GeneN Medical Venture Fund No.1		22.52		2,000		1,943		1,943	Investment finance		Korea
KB-BridgePole Venture Investment Fund 1		6.30		850		826		826	Investment finance		Korea
KB-Kyobo New Mobility Power Fund		28.57		3,000		2,797		2,797	Investment finance		Korea
DA-Friend New Technology Investment Fund No.2		27.06		988		938		938	Investment finance		Korea
Cornerstone Pentastone Fund No.4		21.52		818		784		784	Investment finance		Korea
SKS-VLP New Technology Investment Fund No.2		23.11		1,156		1,109		1,109	Investment finance		Korea
Star-Lord General Investors Private Real Estate Investment Company No.10		26.24		46,700		46,273		—	Real estate investment		Korea
KB-Badgers Future Mobility ESG Fund No.1		40.91		4,890		3,753		3,753	Investment finance		Korea
JS Private Equity Fund No.3		20.48		1,700		1,646		1,646	Investment finance		Korea
Mirae Asset Mobility Investment Fund No.1		22.99		2,000		1,964		1,964	Investment finance		Korea
KB-FT 1st Green Growth Investment Fund 1		10.34		2,000		1,949		1,949	Investment finance		Korea
Glenwood Credit Private Equity Fund No.2		29.89		42,000		42,471		42,471	Investment finance		Korea
THE CHAEUL FUND NO.1		31.25		1,000		981		981	Investment finance		Korea
Smart Korea KB Future9-Sejong Venture Fund		38.46		3,000		2,844		2,844	Investment finance		Korea

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

12.1 Details of investments in associates and joint ventures as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)	June 30, 2023
	Ownership (%)		Acquisition cost		Share of net asset amount		Carrying amount		Industry	Location
KB-KTB Technology Venture Fund 2		50.90		16,800		16,147		16,147	Investment finance		Korea
KB-SOLIDUS Healthcare Investment Fund 2		88.23		19,800		18,057		18,057	Investment finance		Korea
Paramark KB Fund No.1 1		17.34		13,789		12,545		12,545	Investment finance		Korea
KB Co-Investment Private Equity Fund No.1 1		7.12		9,476		9,477		9,412	Investment finance		Korea
POSITIVE Sobujang Venture Fund No.1		43.96		2,000		1,987		1,987	Investment finance		Korea
History 2022 Fintech Fund		34.78		2,000		1,960		1,960	Investment finance		Korea
PEBBLES-MW M.C.E New Technology Investment Fund 1st		23.26		1,671		1,640		1,640	Investment finance		Korea
KB-NP Green ESG New Technology Venture Capital Fund		29.85		13,700		13,036		13,036	Investment finance		Korea
TMAP Mobility Co., Ltd. 1		8.25		200,000		56,116		188,444	Application software development and supply		Korea
Nextrade Co., Ltd. 1		6.64		9,700		9,492		9,492	Investment finance		Korea
Shinhan Global Mobility Fund No.1		24.56		1,345		1,338		1,338	Investment finance		Korea
SKB Next Unicorn K-Battery Fund No.1		24.84		1,995		1,961		1,961	Investment finance		Korea
Lakewood-AVES Fund No.1		39.06		2,000		1,980		1,980	Investment finance		Korea
MW-Pyco NewWave New Technology Investment Fund 4th 2		51.30		2,000		1,986		1,986	Investment finance		Korea
Bitgoeul Cheomdan Green 1st Co., Ltd.		19.00		190		189		189	Electricity		Korea
KB-SUSUNG 1st Inverstment Fund		10.00		2,000		1,990		1,990	Investment finance		Korea
Friend 55 New Technology Business Investment Fund		53.30		1,200		1,195		1,195	Investment finance		Korea
Others				1,742		217		1,056

				743,446		565,368		666,893

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

12.1 Details of investments in associates and joint ventures as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)	December 31, 2022
	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
KB-KDBC Pre-IPO New Technology Business Investment Fund 2		66.66		3,601		5,978			5,978	Investment finance	Korea
Balhae Infrastructure Company 1		12.61		96,516		90,653			90,617	Investment finance	Korea
Aju Good Technology Venture Fund		38.47		8,143		19,840			19,836	Investment finance	Korea
KG Capital Co., Ltd.		49.00		9,800		20,250			19,162	Auto loans	Korea
Incheon Bridge Co., Ltd. 1		14.99		9,158		(15,963	)		—	Operation of highways and related facilities	Korea
Big Dipper Co., Ltd. 1		17.86		440		60			60	Research, consulting, and big data	Korea
Paycoms Co., Ltd. 3		12.24		800		201			213	System software publishing	Korea
Food Factory Co., Ltd. 4		22.22		1,000		696			1,399	Farm product distribution	Korea
KBSP Private Equity Fund No.4 1		14.95		6,100		1,892			1,892	Investment finance	Korea
Korea Credit Bureau Co., Ltd. 1		9.00		4,500		4,959			4,959	Credit information	Korea
KB Social Impact Investment Fund		30.00		4,500		4,266			4,266	Investment finance	Korea
KB-Solidus Global Healthcare Fund 2		43.33		25,927		21,735			22,432	Investment finance	Korea
POSCO-KB Shipbuilding Fund		31.25		1,826		4,798			4,798	Investment finance	Korea
KB-TS Technology Venture Private Equity Fund 2		56.00		9,744		13,794			13,794	Investment finance	Korea
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund 2		42.55		12,450		17,801			17,051	Investment finance	Korea
KB-SJ Tourism Venture Fund 1		18.52		4,599		3,773			3,773	Investment finance	Korea
UNION Media Commerce Fund		28.99		1,000		957			957	Investment finance	Korea
KB-Stonebridge Secondary Private Equity Fund 1		14.56		23,801		25,144			25,144	Investment finance	Korea
KB SPROTT Renewable Private Equity Fund No.1 2		37.69		18,041		16,539			16,539	Investment finance	Korea
KB-UTC Inno-Tech Venture Fund 2		44.29		21,375		19,180			19,180	Investment finance	Korea
WJ Private Equity Fund No.1		26.95		10,000		9,542			9,542	Investment finance	Korea
All Together Korea Fund No.2 5		99.99		10,000		10,244			10,244	Asset management	Korea

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

12.1 Details of investments in associates and joint ventures as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)	December 31, 2022
	Ownership (%)		Acquisition cost		Share of net asset amount		Carrying amount		Industry	Location
KB-NAU Special Situation Corporate Restructuring Private Equity Fund 1		12.00		10,006		12,554		12,554	Asset management	Korea
December & Company Inc. 1		16.78		29,951		3,735		16,029	Investment finance	Korea
2020 KB Fintech Renaissance Fund 1		5.05		550		630		630	Investment finance	Korea
KB Material and Parts No.1 PEF 1		14.47		3,400		3,321		3,321	Investment finance	Korea
FineKB Private Equity Fund No.1		25.00		12,775		10,483		10,483	Investment finance	Korea
G payment Joint Stock Company		43.84		9,029		2,917		9,281	Investment advisory and securities trading	Vietnam
KB-GeneN Medical Venture Fund No.1		22.52		2,000		1,965		1,965	Investment finance	Korea
KB-BridgePole Venture Investment Fund 1		6.30		850		835		835	Investment finance	Korea
KB-Kyobo New Mobility Power Fund		28.57		3,000		2,826		2,826	Investment finance	Korea
DA-Friend New Technology Investment Fund No.2		27.06		988		949		949	Investment finance	Korea
Cornerstone Pentastone Fund No.4		21.52		818		792		792	Investment finance	Korea
SKS-VLP New Technology Investment Fund No.2		23.11		1,156		1,121		1,121	Investment finance	Korea
Star-Lord General Investors Private Real Estate Investment Company No.10		26.24		46,700		45,157		—	Real estate investment	Korea
KB-Badgers Future Mobility ESG Fund No.1		40.91		2,137		1,475		1,475	Investment finance	Korea
JS Private Equity Fund No.3		20.48		1,700		1,664		1,664	Investment finance	Korea
Mirae Asset Mobility Investment Fund No.1		22.99		2,000		1,979		1,979	Investment finance	Korea
KB-FT 1st Green Growth Investment Fund 1		10.34		2,000		1,970		1,970	Investment finance	Korea
Glenwood Credit Private Equity Fund No.2		29.89		42,000		43,468		43,468	Investment finance	Korea
THE CHAEUL FUND NO.1		31.25		1,000		989		989	Investment finance	Korea
Smart Korea KB Future9-Sejong Venture Fund		38.46		2,000		1,870		1,870	Investment finance	Korea
KB-KTB Technology Venture Fund 2		50.90		16,800		16,256		16,256	Investment finance	Korea

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

12.1 Details of investments in associates and joint ventures as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)	December 31, 2022
	Ownership (%)		Acquisition cost		Share of net asset amount			Carrying amount		Industry	Location
KB-SOLIDUS Healthcare Investment Fund 2		88.23		19,800		18,651			18,651	Investment finance		Korea
Paramark KB Fund No.1 1		17.34		12,199		10,966			10,966	Investment finance		Korea
KB Co-Investment Private Equity Fund No.1 1		7.12		7,268		7,269			7,233	Investment finance		Korea
POSITIVE Sobujang Venture Fund No.1		43.96		2,000		1,977			1,977	Investment finance		Korea
History 2022 Fintech Fund		34.78		2,000		1,981			1,981	Investment finance		Korea
PEBBLES-MW M.C.E New Technology Investment Fund 1st		23.26		2,000		1,982			1,982	Investment finance		Korea
KB-NP Green ESG New Technology Venture Capital Fund		29.85		9,350		9,043			9,043	Investment finance		Korea
TMAP Mobility Co., Ltd. 1		8.25		200,000		61,518			194,455	Application software development and supply		Korea
Nextrade Co., Ltd. 1		6.64		9,700		9,700			9,700	Investment finance		Korea
Shinhan Global Mobility Fund No.1		24.56		1,345		1,345			1,345	Investment finance		Korea
SKB Next Unicorn K-Battery Fund No.1		24.84		1,995		1,995			1,995	Investment finance		Korea
Others				2,029		(741	)		1,049

				743,867		558,981			682,670

1	As of June 30, 2023 and December 31, 2022, 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	In order to direct relevant activities, it is necessary to obtain the consent of the two co-operative members; the Group has applied the equity method as the Group cannot control the investee by itself.

3	The ownership of Paycoms Co., Ltd. would be 21.68% and 21.68% as of June 30, 2023 and December 31, 2022, respectively, considering the potential voting rights of convertible bonds.

4	The ownership of Food Factory Co., Ltd. would be 30.00% and 30.00% as of June 30, 2023 and December 31, 2022, respectively, considering the potential voting rights of convertible bonds.

5	As of June 30, 2023 and December 31, 2022, the Group participates in the investment management committee but cannot exercise control.

6	The investment was classified as assets of a disposal group held for sale as of June 30, 2023.

In accordance with Korean IFRS No.1028 Investments in Associates and Joint Ventures, the Group elected an exemption from applying the equity method for 47 companies including Banksalad Co., Ltd. and classified them as financial assets at fair value through profit or loss.

Although the Group holds 20% or more of the ownership, investment trusts with limited influence on related activities according to trust contracts, and companies with limited influence on related activities due to bankruptcy and corporate rehabilitation proceedings are excluded from associates.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

13. Deferred Income Tax Assets and Liabilities

Details of deferred income tax assets and liabilities as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Assets			Liabilities			Net amount
Other provisions		192,440			—			192,440
Allowances for credit losses		31,412			—			31,412
Impairment losses of property and equipment		10,075			(1,410	)		8,665
Stock index-linked deposit interest		—			—			—
Share-based payments		18,200			—			18,200
Provisions for acceptances and guarantees		52,090			—			52,090
Gains or losses on valuation of derivatives		168,262			(268,211	)		(99,949	)
Present value discount		14,874			(13	)		14,861
Gains or losses on fair value hedge		—			(79,861	)		(79,861	)
Accrued interest		—			(182,743	)		(182,743	)
Deferred loan origination fees and costs		15,005			(184,059	)		(169,054	)
Advanced depreciation provision		—			(4,009	)		(4,009	)
Gains or losses on revaluation		313			(291,292	)		(290,979	)
Investments in subsidiaries and others		52,555			(336,291	)		(283,736	)
Gains or losses on valuation of security investment		1,705,224			(61,007	)		1,644,217
Defined benefit liabilities		519,410			(1,483	)		517,927
Accrued expenses		182,722			—			182,722
Retirement insurance expense		—			(620,640	)		(620,640	)
Adjustments to the prepaid contributions		—			(31,542	)		(31,542	)
Derivative-linked securities		7,000			(145,354	)		(138,354	)
Others		960,713			(3,495,190	)		(2,534,477	)

		3,930,295			(5,703,105	)		(1,772,810	)

Offsetting of deferred income tax assets and liabilities		(3,658,519	)		3,658,517			(2	)

		271,776			(2,044,588	)		(1,772,812	)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

13. Deferred Income Tax Assets and Liabilities (cont’d)


(In millions of Korean won)	December 31, 2022
	Assets			Liabilities			Net amount
Other provisions		195,191			—			195,191
Allowances for credit losses		2,139			(12,259	)		(10,120	)
Impairment losses of property and equipment		6,088			(1,476	)		4,612
Share-based payments		21,406			—			21,406
Provisions for acceptances and guarantees		39,787			—			39,787
Gains or losses on valuation of derivatives		135,985			(207,778	)		(71,793	)
Present value discount		20,247			(2,571	)		17,676
Gains or losses on fair value hedge		—			(93,833	)		(93,833	)
Accrued interest		—			(168,068	)		(168,068	)
Deferred loan origination fees and costs		13,675			(185,723	)		(172,048	)
Advanced depreciation provision		—			(4,018	)		(4,018	)
Gains or losses on revaluation		315			(292,373	)		(292,058	)
Investments in subsidiaries and others		48,693			(203,130	)		(154,437	)
Gains or losses on valuation of security investment		1,951,876			(46,551	)		1,905,325
Defined benefit liabilities		497,982			(799	)		497,183
Accrued expenses		268,529			—			268,529
Retirement insurance expense		—			(583,156	)		(583,156	)
Adjustments to the prepaid contributions		—			(27,986	)		(27,986	)
Derivative-linked securities		10,102			(283,840	)		(273,738	)
Others		2,534,543			(3,404,605	)		(870,062	)

		5,746,558			(5,518,166	)		228,392

Offsetting of deferred income tax assets and liabilities		(5,558,186	)		3,943,212			(1,614,974	)

		188,372			(1,574,954	)		(1,386,582	)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

14. Financial Liabilities at Fair Value through Profit or Loss

14.1 Details of financial liabilities at fair value through profit or loss and financial liabilities designated at fair value through profit or loss as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Financial liabilities at fair value through profit or loss
Borrowed securities sold		2,682,215		2,102,537
Others		89,171		90,673

		2,771,386		2,193,210

Financial liabilities designated at fair value through profit or loss
Derivative-linked securities		9,273,033		10,078,394

		9,273,033		10,078,394

		12,044,419		12,271,604

14.2 Difference between the amount contractually required to pay at maturity and carrying amount of financial liabilities designated at fair value through profit or loss as of June 30, 2023 and December 31, 2022 are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Amount contractually required to pay at maturity		9,132,381			9,973,340
Carrying amount		9,273,033			10,078,394

Difference		(140,652	)		(105,054	)

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

15. Deposits

Details of deposits as of June 30, 2023 and December 31, 2022 are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Demand deposits
Demand deposits in Korean won		150,972,799			152,079,457
Demand deposits in foreign currencies		11,619,738			12,844,385

		162,592,537			164,923,842

Time deposits
Time deposits in Korean won		194,173,095			194,117,692
Fair value adjustments of fair value hedged time deposits in Korean won		(767	)		—

		194,172,328			194,117,692

Time deposits in foreign currencies		24,685,867			23,529,633
Fair value adjustments of fair value hedged time deposits in foreign currencies		(8,855	)		(8,591	)

		24,677,012			23,521,042

		218,849,340			217,638,734

Certificates of deposits		9,788,372			6,325,876

Investment contract liabilities		4,851,357			5,040,452

		396,081,606			393,928,904

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

16. Borrowings

16.1 Details of borrowings as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
General borrowings		54,492,441		55,789,869
Bonds sold under repurchase agreements and others		11,010,409		11,773,494
Call money		3,759,147		4,154,003

		69,261,997		71,717,366

16.2 Details of general borrowings as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)		Lenders	Interest rate (%) as of June 30, 2023	June 30, 2023		December 31, 2022
Borrowings in Korean won	Borrowings from the Bank of Korea	The Bank of Korea	0.25 ~ 2.00		6,813,964		8,282,289
	Borrowings from the government	SEMAS and others	0.00 ~ 3.17		2,611,941		2,670,867
	Borrowings from banks	Shinhan Bank and others	0.00 ~ 6.96		917,300		914,360
	Borrowings from non-banking financial institutions	Korea Securities Finance Corporation and others	1.46 ~ 6.96		2,209,224		2,189,510
	Other borrowings	The Korea Development Bank and others	0.00 ~ 7.65		20,856,746		19,806,869

					33,409,175		33,863,895

Borrowings in foreign currencies	Due to banks	Hana Bank and others	—		11,479		18,266
	Borrowings from banks	Citicorp International Ltd and others	0.00 ~ 13.50		16,466,442		16,296,725
	Borrowings from other financial institutions	The Export-Import Bank of Korea and others	5.58 ~ 6.27		30,033		38,249
	Other borrowings	Standard Chartered Bank and others	0.00 ~ 12.00		4,575,312		5,572,734

					21,083,266		21,925,974

					54,492,441		55,789,869

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

17. Debentures

17.1 Details of debentures as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	Interest rate (%) as of June 30, 2023		June 30, 2023			December 31, 2022
Debentures in Korean won
Structured debentures		5.86 ~ 8.62		680			710
Exchangeable bonds *		—		240,000			240,000
Subordinated fixed rate debentures		2.02 ~ 7.86		4,454,320			5,354,890
Fixed rate debentures		1.02 ~ 13.70		47,768,995			45,424,094
Floating rate debentures		3.41 ~ 6.03		3,300,000			5,455,000

				55,763,995			56,474,694
Fair value adjustments of fair value hedged debentures in Korean won				(204,476	)		(249,629	)
Less: Discount on debentures in Korean won				(30,502	)		(29,166	)
Less: Adjustment for exchange right of exchangeable bonds in Korean won				(6,783	)		(8,435	)

				55,522,234			56,187,464

Debentures in foreign currencies
Floating rate debentures		3.56 ~ 6.68		1,790,599			2,168,341
Fixed rate debentures		0.05 ~ 12.00		11,077,994			10,482,244

				12,868,593			12,650,585
Fair value adjustments of fair value hedged debentures in foreign currencies				(88,405	)		(95,865	)
Less: Discount on debentures in foreign currencies				(41,778	)		(43,981	)

				12,738,410			12,510,739

				68,260,644			68,698,203

Fair value of the liability component of exchangeable bonds is calculated by using market interest rate of bonds under the same conditions without the exchange right. The residual amount after deducting the liability component from the issuance amount, represents the value of the exchange right and is recorded in equity. Shares to be exchanged are 5 million treasury shares of KB Financial Group Inc. with the exchange price of 48,000. Exercise period for exchange right is from the 60th day of the issuance date to 10 days before the maturity date.

Table of Contents

KB Financial Group Inc. and Subsidiaries

Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

18. Provisions

18.1 Details of provisions as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Provisions for credit losses of unused loan commitments		364,359		342,182
Provisions for credit losses of acceptances and guarantees		195,518		153,529
Provisions for credit losses of financial guarantee contracts		6,341		2,955
Provisions for restoration costs		155,122		159,033
Others		256,969		276,002

		978,309		933,701

18.2 Changes in provisions for credit losses of unused loan commitments, and acceptances and guarantees for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)
	2023
	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
	12-month expected credit losses			Non- impaired			Impaired			12-month expected credit losses			Non- impaired			Impaired
Beginning		179,885			151,067			11,230			26,906			118,724			7,899
Transfer between stages:
Transfer to 12-month expected credit losses		54,901			(52,872	)		(2,029	)		(3,620	)		(374	)		3,994
Transfer to lifetime expected credit losses		(10,944	)		11,227			(283	)		(205	)		306			(101	)
Impairment		(312	)		(1,581	)		1,893			—			(113	)		113
Provision (reversal) for credit losses		6,292			14,953			(830	)		8,718			35,055			(5,102	)
Others (exchange differences, etc.)		1,160			598			4			404			2,715			199

Ending		230,982			123,392			9,985			32,203			156,313			7,002

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

18.2 Changes in provisions for credit losses of unused loan commitments, and acceptances and guarantees for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(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
	12-month expected credit losses			Non- impaired			Impaired			12-month expected credit losses			Non- impaired			Impaired
Beginning		153,997			146,619			8,024			27,397			82,170			11,537
Transfer between stages:
Transfer to 12-month expected credit losses		29,231			(28,437	)		(794	)		1,104			(1,104	)		—
Transfer to lifetime expected credit losses		(8,405	)		8,749			(344	)		(304	)		965			(661	)
Impairment		(136	)		(1,140	)		1,276			(9	)		(138	)		147
Provision (reversal) for credit losses		(8,237	)		7,406			206			(4,471	)		53,525			(3,852	)
Others (exchange differences, etc.)		1,493			622			—			2,025			5,217			20

Ending		167,943			133,819			8,368			25,742			140,635			7,191

18.3 Changes in provisions for credit losses of financial guarantee contracts for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023		2022
Beginning		2,955		5,351
Provision		3,386		2,285
Others		—		(819	)

Ending		6,341		6,817

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

18.4 Changes in provisions for restoration costs for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Beginning		159,033			152,186
Provision		3,933			6,101
Reversal		(1,586	)		(1,559	)
Used		(9,551	)		(9,640	)
Unwinding of discount		3,141			1,372
Effect of changes in discount rate		152			68

Ending		155,122			148,528

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.

18.5 Changes in other provisions for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Membership rewards program			Dormant accounts			Litigations			Others			Total
Beginning		46			2,794			113,527			159,635			276,002
Increase		36			1,969			1,504			13,602			17,111
Decrease		(33	)		(1,758	)		(32,658	)		(9,681	)		(44,130	)
Others		—			—			3,542			4,444			7,986

Ending		49			3,005			85,915			168,000			256,969


(In millions of Korean won)	2022
	Membership rewards program			Dormant accounts			Litigations			Others			Total
Beginning		22,902			3,062			55,168			109,174			190,306
Increase		39,302			1,358			1,618			13,600			55,878
Decrease		(38,491	)		(1,510	)		(816	)		(11,681	)		(52,498	)
Others		—			—			120			—			120

Ending		23,713			2,910			56,090			111,093			193,806

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

19. Net Defined Benefit Liabilities

19.1 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 recognized in the consolidated statement of financial position are calculated by the independent actuary in accordance with actuarial valuation method. The defined benefit obligation is calculated using the projected unit credit method. Assumptions based on market data and historical data such as discount rate, future salary increase rate, mortality, and consumer price index are used which are updated annually.

Actuarial assumptions may differ from actual results, due to changes in the market conditions, economic trends, and mortality trends which may affect net defined benefit liabilities and future payments. Actuarial gains and losses arising from changes in actuarial assumptions are recognized in the period incurred through other comprehensive income.

19.2 Details of net defined benefit liabilities as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Present value of defined benefit obligation		2,143,690			2,215,330
Fair value of plan assets		(2,499,981	)		(2,608,519	)

Net defined benefit liabilities (asset) *		(356,291	)		(393,189	)

As of June 30, 2023, the net defined benefit asset of 356,291 million is the amount obtained by subtracting the net defined benefit liability of 112,351 million from the net defined benefit asset of 468,642 million. Similarly, as of December 31, 2022, the net defined benefit asset of 393,189 million is the amount obtained by subtracting the net defined benefit liability of 85,745 million from the net defined benefit asset of 478,934 million.

19.3 Details of post-employment benefits recognized in profit or loss for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Current service cost		98,367			123,917
Net interest expense on net defined benefit liabilities		(11,467	)		991

Post-employment benefits *		86,900			124,908

Includes post-employment benefits amounting to 9,602 million recognized as insurance service expenses, 1,412 million recognized as other operating expenses and 69 million recognized as advanced payments for the six-month period ended June 30, 2023, and 14,086 million recognized as insurance service expenses and 1,509 million recognized as other operating expenses for the six-month period ended June 30, 2022.

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

20. Equity

20.1 Share Capital

20.1.1 Details of share capital as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won and in number of shares)	June 30, 2023		December 31, 2022
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		403,511,072		408,897,068
Share capital *		2,090,558		2,090,558

*	Due to the retirement of shares deducted through retained earnings, it is different from the total par value of the shares issued.

20.1.2 Changes in outstanding shares for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In number of shares)	2023			2022
Beginning		389,634,335			389,634,335
Increase		—			—
Decrease		(5,385,996	)		—

Ending		384,248,339			389,634,335

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

20.2 Hybrid Securities

Details of hybrid securities classified as equity as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


Hybrid securities	Issuance date	Maturity	Interest rate (%) as of June 30, 2023		June 30, 2023		December 31, 2022
The 1-1st	May 2, 2019	Perpetual bond		3.23		349,309		349,309
The 1-2nd	May 2, 2019	Perpetual bond		3.44		49,896		49,896
The 2-1st	May 8, 2020	Perpetual bond		3.30		324,099		324,099
The 2-2nd	May 8, 2020	Perpetual bond		3.43		74,812		74,812
The 3-1st	Jul. 14, 2020	Perpetual bond		3.17		369,099		369,099
The 3-2nd	Jul. 14, 2020	Perpetual bond		3.38		29,922		29,922
The 4-1st	Oct. 20, 2020	Perpetual bond		3.00		433,996		433,996
The 4-2nd	Oct. 20, 2020	Perpetual bond		3.28		64,855		64,855
The 5-1st	Feb. 19, 2021	Perpetual bond		2.67		419,071		419,071
The 5-2nd	Feb. 19, 2021	Perpetual bond		2.87		59,862		59,862
The 5-3rd	Feb. 19, 2021	Perpetual bond		3.28		119,727		119,727
The 6-1st	May 28, 2021	Perpetual bond		3.20		165,563		165,563
The 6-2nd	May 28, 2021	Perpetual bond		3.60		109,708		109,708
The 7-1st	Oct. 8, 2021	Perpetual bond		3.57		208,468		208,468
The 7-2nd	Oct. 8, 2021	Perpetual bond		3.80		59,834		59,834
The 8-1st	Feb. 16, 2022	Perpetual bond		4.00		442,970		442,970
The 8-2nd	Feb. 16, 2022	Perpetual bond		4.30		155,626		155,626
The 9-1st	May 12, 2022	Perpetual bond		4.68		478,829		478,829
The 9-2nd	May 12, 2022	Perpetual bond		4.97		19,906		19,906
The 10-1st	Aug. 26, 2022	Perpetual bond		4.90		407,936		407,936
The 10-2nd	Aug. 26, 2022	Perpetual bond		5.15		70,819		70,819
The 10-3rd	Aug. 26, 2022	Perpetual bond		5.30		19,944		19,944
The 11-1st	Feb. 3, 2023	Perpetual bond		4.90		548,681		—
The 11-2nd	Feb. 3, 2023	Perpetual bond		5.03		49,871		—

						5,032,803		4,434,251

The above hybrid securities are early redeemable by the Group after 5 or 7 or 10 years from the issuance date. On the other hand, hybrid securities of 1,282,993 million issued by Kookmin Bank, hybrid securities of 102,673 million issued by KB Securities Co., Ltd. and hybrid securities of 49,800 million issued by KB Life Insurance Co., Ltd. are recognized as non-controlling interests and are early redeemable after 5 years from the issuance date and each interest payment date thereafter.

20.3 Capital Surplus

Details of capital surplus as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Paid-in capital in excess of par value		13,190,274			13,190,274
Losses on sales of treasury shares		(481,332	)		(481,332	)
Other capital surplus		3,928,359			4,219,856
Consideration for exchange right of exchangeable bonds		11,932			11,933

		16,649,233			16,940,731

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

20.4 Accumulated Other Comprehensive Income

Details of accumulated other comprehensive income as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Remeasurements of net defined benefit liabilities		(79,598	)		(88,770	)
Currency translation differences		338,564			254,446
Losses on financial instruments at fair value through other comprehensive income		(5,295,873	)		(6,081,560	)
Share of other comprehensive loss of associates and joint ventures		(4,525	)		(3,342	)
Gains on cash flow hedging instruments		5,400			19,632
Losses on hedging instruments of net investments in foreign operations		(154,138	)		(114,742	)
Fair value changes of financial liabilities designated at fair value through profit or loss due to own credit risk		(9,522	)		41,063
Insurance finance income		7,109,780			7,285,794

		1,910,088			1,312,521

20.5 Retained Earnings

20.5.1 Details of retained earnings as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Legal reserves *		1,007,685		839,235
Voluntary reserves		982,000		982,000
Unappropriated retained earnings		28,863,935		27,101,037

		30,853,620		28,922,272

With respect to the allocation of net profit earned in a fiscal term, the Parent Company 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 53 of the Financial Holding Company Act. This reserve is not available for the payment of cash dividends, but may be transferred to share capital, or used to reduce accumulated deficit.

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

20.5.2 Regulatory reserve for credit losses

Measurement and disclosure of regulatory reserve for credit losses are required in accordance with Articles 26 through 28 of Regulations on Supervision of Financial Holding Companies.

20.5.2.1 Details of regulatory reserve for credit losses as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Regulatory reserve for credit losses attributable to:
Shareholders of the Parent Company		3,934,939		4,355,734
Non-controlling interests		168,931		89,214

		4,103,870		4,444,948

20.5.2.2 Regulatory reserve for credit losses estimated to be appropriated and adjusted profit after provision of regulatory reserve for credit losses for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won, except for per share amounts)	2023						2022
	Three months			Six months			Three months		Six months
Provision (reversal) of regulatory reserve for credit losses		(107,158	)		(420,795	)		131,953		209,943
Adjusted profit after provision of regulatory reserve for credit losses 1,2		1,558,144			3,328,708			1,049,348		2,409,397
Adjusted basic earnings per share after provision of regulatory reserve for credit losses 1		4,055			8,620			2,693		6,184
Adjusted diluted earnings per share after provision of regulatory reserve for credit losses 1		3,967			8,424			2,636		6,045

1	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 shareholders of the Parent Company.

2	After deducting dividends on hybrid securities

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

20.6 Treasury Shares

Changes in treasury shares for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won and in number of shares)	2023
	Beginning		Acquisition		Retirement			Ending
Number of treasury shares *		19,262,733		5,385,996		(5,385,996	)		19,262,733
Carrying amount		836,188		271,745		(242,096	)		865,837

(In millions of Korean won and in number of shares)	2022
	Beginning		Acquisition		Retirement			Ending
Number of treasury shares *		26,173,585		—		(3,455,426	)		22,718,159
Carrying amount		1,136,188		—		(150,000	)		986,188

*	5 million treasury shares are deposited at the Korea Securities Depository for the exchange of exchangeable bonds.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

21. Net Interest Income

Details of interest income, interest expense, and net interest income for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023				2022
	Three months		Six months		Three months		Six months
Interest income
Due from financial institutions measured at fair value through profit or loss		514		999		751		1,601
Securities measured at fair value through profit or loss		337,366		667,458		203,648		389,305
Loans measured at fair value through profit or loss		3,269		6,169		3,013		5,243
Securities measured at fair value through other comprehensive income		532,805		1,044,541		425,279		698,290
Loans measured at fair value through other comprehensive income		9,033		16,608		3,433		6,350
Due from financial institutions measured at amortized cost		88,205		164,089		27,080		47,859
Securities measured at amortized cost		272,049		527,131		74,203		256,828
Loans measured at amortized cost		5,762,190		11,314,216		3,869,793		7,423,423
Insurance finance income		5,748		11,298		4,253		9,221
Others		119,481		244,734		81,995		161,640

		7,130,660		13,997,243		4,693,448		8,999,760

Interest expense
Deposits		2,423,201		4,766,124		844,270		1,575,588
Borrowings		627,183		1,209,494		245,363		423,973
Debentures		477,976		1,107,182		349,766		675,653
Insurance finance expense		428,573		869,684		391,744		775,843
Others		200,057		285,496		41,053		75,940

		4,156,990		8,237,980		1,872,196		3,526,997

Net interest income		2,973,670		5,759,263		2,821,252		5,472,763

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

22. Net Fee and Commission Income

Details of fee and commission income, fee and commission expense, and net fee and commission income for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023				2022
	Three months		Six months		Three months		Six months
Fee and commission income
Banking activity fees		45,236		91,164		45,519		89,716
Lending activity fees		26,125		51,452		21,365		40,627
Credit card and debit card related fees		394,943		797,531		380,041		750,414
Agent activity fees		49,089		103,624		46,855		90,754
Trust and other fiduciary fees		100,700		189,405		86,703		170,180
Fund management related fees		32,042		65,112		28,334		70,275
Acceptances and guarantees fees		18,756		34,487		18,255		33,315
Foreign currency related fees		77,980		152,985		71,380		136,933
Securities agency fees		28,899		59,117		34,920		66,702
Other business account commission on consignment		8,329		21,035		8,663		21,216
Commissions received on securities business		202,359		340,011		181,255		399,726
Lease fees		272,593		536,156		240,051		481,981
Others		104,663		254,337		151,963		298,394

		1,361,714		2,696,416		1,315,304		2,650,233

Fee and commission expense
Trading activity related fees *		14,501		26,261		10,837		21,693
Lending activity fees		7,939		17,012		10,928		21,734
Credit card and debit card related fees		221,458		428,910		189,572		384,551
Outsourcing related fees		39,726		83,035		42,162		76,337
Foreign currency related fees		20,774		41,309		14,868		29,089
Others		105,912		234,479		112,381		225,017

		410,310		831,006		380,748		758,421

Net fee and commission income		951,404		1,865,410		934,556		1,891,812

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

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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

23.1 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 three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


	2023					2022
(In millions of Korean won)	Three months			Six months		Three months			Six months
Gains on financial instruments at fair value through profit or loss
Financial assets at fair value through profit or loss:
Debt securities		487,684			1,977,155		613,373			1,125,233
Equity securities		204,288			523,954		112,884			294,579

		691,972			2,501,109		726,257			1,419,812

Derivatives held for trading:
Interest rate		(104,886	)		3,193,824		4,276,043			9,516,285
Currency		1,942,399			5,957,222		5,790,016			8,077,841
Stock or stock index		460,017			1,382,063		445,631			1,028,906
Credit		13,742			24,600		39,637			52,911
Commodity		9,705			19,208		8,308			16,897
Others		48,719			116,979		37,365			109,496

		2,369,696			10,693,896		10,597,000			18,802,336

Financial liabilities at fair value through profit or loss		80,383			118,545		21,701			143,550
Other financial instruments		(253	)		403		16			91

		3,141,798			13,313,953		11,344,974			20,365,789

Losses on financial instruments at fair value through profit or loss
Financial assets at fair value through profit or loss:
Debt securities		301,941			588,402		1,412,026			2,624,780
Equity securities		119,568			185,368		408,016			639,408

		421,509			773,770		1,820,042			3,264,188

Derivatives held for trading:
Interest rate		(425,935	)		3,071,500		3,967,216			8,814,240
Currency		2,137,888			6,236,181		5,871,723			8,257,453
Stock or stock index		497,435			1,175,056		751,137			1,573,020
Credit		14,121			27,935		30,311			43,061
Commodity		10,190			25,721		8,271			15,146
Others		28,273			96,714		94,754			283,130

		2,261,972			10,633,107		10,723,412			18,986,050

Financial liabilities at fair value through profit or loss		61,851			214,536		793			34,187
Other financial instruments		(261	)		210		52			60

		2,745,071			11,621,623		12,544,299			22,284,485

Net gains (losses) on financial instruments at fair value through profit or loss		396,727			1,692,330		(1,199,325	)		(1,918,696	)

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

23.2 Net Gains or Losses on Financial Instruments Designated at Fair Value through Profit or Loss

Net gains or losses on financial instruments designated at fair value through profit or loss include 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 designated at fair value through profit or loss for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023						2022
	Three months			Six months			Three months		Six months
Gains on financial instruments designated at fair value through profit or loss
Financial liabilities designated at fair value through profit or loss		134,470			287,427			356,260		847,762

		134,470			287,427			356,260		847,762

Losses on financial instruments designated at fair value through profit or loss
Financial liabilities designated at fair value through profit or loss		145,290			820,443			30,202		127,862

		145,290			820,443			30,202		127,862

Net gains (losses) on financial instruments designated at fair value through profit or loss		(10,820	)		(533,016	)		326,058		719,900

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

24. Net Other Operating Income and Expenses

Details of other operating income and expenses for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023						2022
	Three months			Six months			Three months			Six months
Other operating income
Gains on financial instruments at fair value through other comprehensive income:
Gains on redemption of financial instruments at fair value through other comprehensive income		2,118			2,650			—			3
Gains on disposal of financial instruments at fair value through other comprehensive income		8,675			55,044			2,111			8,657

		10,793			57,694			2,111			8,660

Gains on financial assets at amortized cost:
Gains on sale of loans measured at amortized cost		54,086			73,441			45,716			58,325
Gains on disposal of securities measured at amortized cost		3			118			—			—

		54,089			73,559			45,716			58,325

Gains on hedge accounting		(34,950	)		129,513			370,598			763,811
Gains on foreign exchange transactions		1,245,891			4,356,123			3,345,269			4,231,946
Dividend income		9,171			29,552			4,847			27,780
Others		153,792			286,228			108,837			216,533

		1,438,786			4,932,669			3,877,378			5,307,055

Other operating expenses
Losses on financial instruments at fair value through other comprehensive income:
Losses on redemption of financial instruments at fair value through other comprehensive income		—			2			1,227			1,553
Losses on disposal of financial instruments at fair value through other comprehensive income		88,114			116,664			66,194			91,865

		88,114			116,666			67,421			93,418

Losses on financial assets at amortized cost:
Losses on sale of loans measured at amortized cost		11,123			15,896			3,586			6,468

		11,123			15,896			3,586			6,468

Losses on hedge accounting		(14,602	)		176,586			384,634			723,380
Losses on foreign exchanges transactions		1,046,755			3,849,957			3,056,798			3,860,057
Deposit insurance fee		141,787			284,483			134,726			263,747
Credit guarantee fund fee		75,638			149,411			68,917			134,701
Depreciation expenses of operating lease assets		177,103			350,486			166,502			329,188
Others		370,952			707,392			332,643			650,252

		1,896,870			5,650,877			4,215,227			6,061,211

Net other operating expenses		(458,084	)		(718,208	)		(337,849	)		(754,156	)

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

25. General and Administrative Expenses

25.1 Details of general and administrative expenses for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023				2022
	Three months		Six months		Three months			Six months
Expenses related to employee
Employee benefits - salaries		675,869		1,338,347		673,833			1,308,920
Employee benefits - others		204,843		435,253		216,337			433,014
Post-employment benefits - defined benefit plans		39,099		75,886		55,487			109,313
Post-employment benefits - defined contribution plans		6,392		14,087		8,922			15,378
Termination benefits		3,263		4,219		21			428
Share-based payments		15,307		26,668		(17,518	)		23,180

		944,773		1,894,460		937,082			1,890,233

Depreciation and amortization		211,331		416,864		197,195			386,944

Other general and administrative expenses		23,367		48,342		22,316			46,398
Rental expense		101,115		169,892		72,103			130,928
Tax and dues		10,992		22,405		12,522			24,193
Communication		8,752		18,610		6,776			15,127
Electricity and utilities		2,496		4,488		2,491			4,825
Publication		10,464		21,652		11,435			20,535
Repairs and maintenance		4,304		8,514		4,444			8,253
Vehicle		5,077		8,906		4,718			6,846
Travel		10,900		19,732		9,257			16,883
Training		57,354		109,784		56,470			105,837
Service fees		82,139		177,498		73,002			139,158
Electronic data processing expenses		56,499		100,491		66,751			98,156
Advertising		63,379		137,590		76,292			139,916
Others		436,838		847,904		418,577			757,055

		1,592,942		3,159,228		1,552,854			3,034,232

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

25.2 Share-based Payments

25.2.1 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.

25.2.1.1 Details of stock grants linked to long-term performance as of June 30, 2023, are as follows:


(In number of shares)	Grant date	Number of granted shares 1		Vesting conditions 2
KB Financial Group Inc.
Series 28	Nov. 21, 2020		68,135	Services fulfillment, market performance 3 35%, and non-market performance 5 65%
Series 30	Apr. 1, 2021		3,070	Services fulfillment, market performance 3 30%, and non-market performance 4 70%
Series 33	Jan. 1, 2022		57,464	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 34	Feb. 1, 2022		654	Services fulfillment, market performance 3 30%, and non-market performance 4 70%
Series 35	May 27, 2022		6,364	Services fulfillment, market performance 3 30%, and non-market performance 4 70%
Series 36	Jan. 1, 2023		83,561	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Deferred grant in 2015			3,183	Satisfied
Deferred grant in 2016			943	Satisfied
Deferred grant in 2018			884	Satisfied
Deferred grant in 2020			18,871	Satisfied
Deferred grant in 2021			18,105	Satisfied
Deferred grant in 2022			38,277	Satisfied

			299,511

Kookmin Bank
Series 83	Apr. 1, 2021		14,972	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 85	Jan. 1, 2022		259,724	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100% Services fulfillment, market performance 3 30%, and EPS & Asset Quality 6 70%
Series 86	Feb. 1, 2022		1,525	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 88	Mar. 14, 2022		5,884	Services fulfillment, market performance 0~30%, and non-market performance 4 70~100%
Series 90	Jul. 18, 2022		4,131	Services fulfillment, market performance 0~30%, and non-market performance 4 70~100%
Series 91	Aug. 24, 2022		7,277	Services fulfillment, market performance 0~30%, and non-market performance 4 70~100%
Series 92	Jan. 1, 2023		216,811	Services fulfillment, market performance 0~30%, and non-market performance 4 70~100%
Series 93	Apr. 1, 2023		13,422	Services fulfillment, market performance 0~30%, and non-market performance 4 70~100%

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

25.2.1.1 Details of stock grants linked to long-term performance as of June 30, 2023, are as follows: (cont’d)


(In number of shares)	Grant date	Number of granted shares 1		Vesting conditions 2
Deferred grant in 2016			799	Satisfied
Deferred grant in 2017			893	Satisfied
Deferred grant in 2018			1,145	Satisfied
Deferred grant in 2020			26,763	Satisfied
Deferred grant in 2021			104,643	Satisfied
Deferred grant in 2022			87,342	Satisfied
Deferred grant in 2023			1,289	Satisfied

			746,620

Other subsidiaries
Stock granted in 2010			106	Services fulfillment, market performance 3 0~50%, and non-market performance 4 50~100%
Stock granted in 2011			146
Stock granted in 2012			420
Stock granted in 2013			544
Stock granted in 2014			1,028
Stock granted in 2015			2,014
Stock granted in 2016			3,048
Stock granted in 2017			9,548
Stock granted in 2018			19,861
Stock granted in 2019			23,788
Stock granted in 2020			94,348
Stock granted in 2021			120,615
Stock granted in 2022			389,083
Stock granted in 2023			374,944

			1,039,493

			2,085,624

1	Granted shares represent the total number of shares initially granted to executives and employees who have residual shares as of June 30, 2023 (Deferred grants are residual shares vested as of June 30, 2023).

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.

3	Relative TSR (Total Shareholder Return): [(Fair value at the end of the contract—Fair value at the beginning of the contract) + (Total amount of dividend per share paid during the contract period)] / Fair value at the beginning of the contract

4	Performance results of company and employee

5	EPS (Earnings Per Share), Asset Quality, HCROI (Human Capital Return on Investment), Profit from non-banking segments

6	EPS, Asset Quality

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

25.2.1.2 Details of stock grants linked to short-term performance as of June 30, 2023, are as follows:


(In number of shares)	Estimated number of vested shares *		Vesting conditions
KB Financial Group Inc.
Stock granted in 2015		2,097		Satisfied
Stock granted in 2016		3,034		Satisfied
Stock granted in 2017		306		Satisfied
Stock granted in 2018		380		Satisfied
Stock granted in 2020		12,336		Satisfied
Stock granted in 2021		23,677		Satisfied
Stock granted in 2022		45,115		Satisfied
Stock granted in 2023		26,578		Proportional to service period
Kookmin Bank
Stock granted in 2015		419		Satisfied
Stock granted in 2016		2,135		Satisfied
Stock granted in 2017		535		Satisfied
Stock granted in 2018		739		Satisfied
Stock granted in 2020		44,890		Satisfied
Stock granted in 2021		86,235		Satisfied
Stock granted in 2022		164,595		Satisfied
Stock granted in 2023		74,281		Proportional to service period
Other subsidiaries
Stock granted in 2015		4,048		Satisfied
Stock granted in 2016		18,144		Satisfied
Stock granted in 2017		35,359		Satisfied
Stock granted in 2018		82,096		Satisfied
Stock granted in 2019		91,957		Satisfied
Stock granted in 2020		262,400		Satisfied
Stock granted in 2021		464,576		Satisfied
Stock granted in 2022		511,024		Satisfied
Stock granted in 2023		171,784		Proportional to service period

		2,128,740

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

25.2.1.3 The accrued expenses for share-based payments related to stock grants are 154,984 million and 186,908 million as of June 30, 2023 and December 31, 2022, respectively, and the compensation costs amounting to 27,771 million and 23,664 million were recognized for the six-month periods ended June 30, 2023 and 2022, respectively.

25.2.2 Mileage stock

25.2.2.1 Details of mileage stock as of June 30, 2023, 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		0.00~1.34		48
		Nov. 8, 2019		14		0.00~1.36		6
		Dec. 5, 2019		56		0.00~1.43		39
		Dec. 6, 2019		84		0.00~1.43		39
		Dec. 31, 2019		87		0.00~1.50		22
Stock granted in 2020
		Jan. 18, 2020		28,645		0.00~1.55		14,301
		May 12, 2020		46		0.00~1.87		43
		Jun. 30, 2020		206		0.00~2.00		147
		Aug. 26, 2020		40		0.00~2.16		27
		Oct. 29, 2020		160		0.00~2.33		107
		Nov. 6, 2020		45		0.00~2.35		37
		Nov. 30, 2020		35		0.00~2.42		34
		Dec. 2, 2020		57		0.00~2.42		33
		Dec. 4, 2020		154		0.00~2.43		95
		Dec. 30, 2020		88		0.00~2.50		64
Stock granted in 2021
		Jan. 15, 2021		28,156		0.00~2.55		16,597
		Apr. 5, 2021		89		0.00~2.76		53
		Jul. 1, 2021		54		0.00~3.00		54
		Jul. 2, 2021		11		0.00~3.01		11
		Jul. 27, 2021		70		0.00~3.07		63
		Nov. 1, 2021		71		0.00~3.34		71
		Nov. 16, 2021		53		0.00~3.38		13
		Dec. 3, 2021		91		0.00~3.43		79
		Dec. 6, 2021		87		0.00~3.44		79
		Dec. 30, 2021		76		0.00~3.50		76

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

25.2.2.1 Details of mileage stock as of June 30, 2023, 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		0.00~3.54		17,473
		Apr. 4, 2022		65		0.00~3.76		65
		Apr. 19, 2022		33		0.00~3.80		33
		Jul. 1, 2022		62		0.00~4.00		62
		Aug. 3, 2022		62		0.00~4.09		62
		Aug. 9, 2022		80		0.00~4.11		76
		Oct. 19, 2022		55		0.00~4.30		55
		Nov. 1, 2022		177		0.00~4.34		177
		Dec. 1, 2022		49		0.00~4.42		49
		Dec. 2, 2022		42		0.00~4.42		42
		Dec. 6, 2022		88		0.00~4.44		88
		Dec. 12, 2022		114		0.00~4.45		114
		Dec. 15, 2022		42		0.00~4.46		42
		Dec. 30, 2022		114		0.00~4.50		114
Stock granted in 2023
		Jan. 9, 2023		23,071		0.00~4.53		22,146
		Jan. 14, 2023		742		0.00~4.54		688
		Mar. 7, 2023		58		0.00~4.68		58
		Mar. 27, 2023		58		0.00~4.74		58
		Mar. 31, 2023		97		0.00~4.75		97
		May 4, 2023		106		0.00~4.84		105

				104,618				73,742

Mileage stock is exercisable for four 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 June 30, 2023. These shares are vested immediately at grant date.

25.2.2.2 The accrued expenses for share-based payments related to mileage stock are 3,521 million and 2,738 million as of June 30, 2023 and December 31, 2022, respectively. The compensation costs amounting to 1,654 million and 809 million were recognized as expenses for the six-month periods ended June 30, 2023 and 2022, respectively.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

25.2.3 Long-term share-based payments

The Group calculates the short-term performance bonus of executives of KB Life Insurance Co., Ltd.(former Prudential Life Insurance Company of Korea Ltd.) based on the result of performance evaluation as of the grant date and defers the bonus for three years and pays it in cash reflecting the stock price of KB Financial Group Inc. at that time.

25.2.3.1 Details of long-term share-based payments as of June 30, 2023, are as follows:

(In number of shares)

Grant date

Vested shares

Expected exercise period (years)

Vesting condition

Granted in 2020

2020

13,402

0.50

Services fulfillment

25.2.3.2 The accrued expenses for long-term share-based payments amount to 625 million as of June 30, 2023 and December 31, 2022. The reversal compensation costs amounting to 87 million were recognized for the six-month period ended June 30, 2022.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

26. Income Tax Expense

26.1 Details of income tax expense for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Income tax payable
Current income tax expense		789,392			1,127,562
Adjustments of income tax of prior years recognized in current tax		(11,287	)		(101,851	)

		778,105			1,025,711

Changes in deferred income tax assets and liabilities *		386,230			(270,959	)

Income tax recognized directly in equity and others		(187,230	)		113,415
Remeasurements of net defined benefit liabilities		(3,312	)		12,456
Currency translation differences		514			(21,076	)
Net gains or losses on financial assets at fair value through other comprehensive income		(286,626	)		2,044,803
Share of other comprehensive income or loss of associates and joint ventures		414			(80	)
Gains or losses on cash flow hedging instruments		(875	)		(19,977	)
Gains or losses on hedging instruments of net investments in foreign operations		14,139			33,288
Gain on revaluation of property, plant and equipment		84			7,149
Fair value changes of financial liabilities designated at fair value through profit or loss due to own credit risk		18,220			(2,744	)
Insurance finance income		70,212			(1,940,404	)

Others		8,434			20,912

Income tax expense		985,539			889,079

27. Dividends

The annual dividends to the shareholders of the Parent Company for the year ended December 31, 2022, amounting to 564,970 million ( 1,450 per share) were declared at the annual general shareholders’ meeting on March 24, 2023 and paid in April 10, 2023. According to the resolution of the Board of Directors on April 27, 2023, the interim dividends per share of 510 (total dividends: 195,967 million) with dividend record date of March 31, 2023 were paid on May 11, 2023. Meanwhile, the annual dividends and interim dividends paid in 2022 were 853,299 million ( 2,190 per share) and 584,452 million ( 500 per share), respectively.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

28. Accumulated Other Comprehensive Income (Loss)

Changes in accumulated other comprehensive income (loss) for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Beginning			Changes except for reclassifi- cation			Reclassification to profit or loss			Transfer within equity			Tax effect			Ending
Remeasurements of net defined benefit liabilities		(88,770	)		12,484			—			—			(3,312	)		(79,598	)
Currency translation differences		254,446			107,357			(23,753	)		—			514			338,564
Losses on financial instruments at fair value through other comprehensive income		(6,081,560	)		1,016,064			92,210			(35,961	)		(286,626	)		(5,295,873	)
Share of other comprehensive loss of associates and joint ventures		(3,342	)		(1,597	)		—			—			414			(4,525	)
Gains (losses) on cash flow hedging instruments		19,632			(2,940	)		(10,417	)		—			(875	)		5,400
Losses on hedging instruments of net investments in foreign operations		(114,742	)		(53,535	)		—			—			14,139			(154,138	)
Fair value changes of financial liabilities designated at fair value through profit or loss due to own credit risk		41,063			(68,805	)		—			—			18,220			(9,522	)
Gains on revaluation of property and equipment		—			(84	)		—			—			84			—
Insurance finance income		7,285,794			(246,226	)		—			—			70,212			7,109,780

		1,312,521			762,718			58,040			(35,961	)		(187,230	)		1,910,088

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

28. Accumulated Other Comprehensive Income (Loss) (cont’d)

Changes in accumulated other comprehensive income (loss) for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2022
	Beginning			Changes except for reclassifi- cation			Reclassification to profit or loss			Transfer within equity			Tax effect			Ending
Remeasurements of net defined benefit liabilities		(328,392	)		(44,588	)		—			—			12,456			(360,524	)
Currency translation differences		96,129			278,020			—			—			(21,076	)		353,073
Gains (losses) on financial instruments at fair value through other comprehensive income		434,956			(7,702,841	)		268,683			396			2,044,803			(4,954,003	)
Share of other comprehensive loss of associates and joint ventures		(2,980	)		101			—			—			(80	)		(2,959	)
Gains (losses) on cash flow hedging instruments		(6,535	)		68,090			(26,882	)		—			(19,977	)		14,696
Losses on hedging instruments of net investments in foreign operations		(35,658	)		(129,271	)		—			—			33,288			(131,641	)
Fair value changes of financial liabilities designated at fair value through profit or loss due to own credit risk		2,208			9,978			—			—			(2,744	)		9,442
Gain on revaluation of tangible assets		—			18,845			—			(25,994	)		7,149			—
Assets of a disposal group held for sale		7,671			(7,671	)		—			—			—			—
Insurance finance income		1,255,023			7,056,015			—			—			(1,940,404	)		6,370,634

		1,422,422			(453,322	)		241,801			(25,598	)		113,415			1,298,718

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

29. Earnings per Share

29.1 Basic Earnings per Share

Basic earnings per share is calculated by dividing profit attributable to ordinary equity holders of the Parent Company by the weighted average number of ordinary shares outstanding.

29.1.1 Weighted average number of ordinary shares outstanding


(In number of shares)	2023						2022
	Three months			Six months			Three months			Six months
Number of issued ordinary shares		403,511,072			403,511,072			412,352,494			412,352,494
Number of treasury shares *		(19,262,733	)		(19,262,733	)		(22,718,159	)		(22,718,159	)

Weighted average number of ordinary shares outstanding		384,248,339			386,170,890			389,634,335			389,634,335

*	Initial dates of treasury stock that were deducted by the retirement for the six-month periods ended June 30, 2023 and 2022 were April 4, 2023 and February 14, 2022, respectively.

29.1.2 Basic earnings per share


(In Korean won and in number of shares)	2023
	Three months			Six months
Profit attributable to shareholders of the Parent Company		1,499,055,844,747			2,996,686,806,722
Deduction: Dividends on hybrid securities		(48,070,325,000	)		(88,774,400,000	)

Profit attributable to the ordinary equity holders of the Parent Company (A)		1,450,985,519,747			2,907,912,406,722
Weighted average number of ordinary shares outstanding (B)		384,248,339			386,170,890

Basic earnings per share (A/B)		3,776			7,530


(In Korean won and in number of shares)	2022
	Three months			Six months
Profit attributable to shareholders of the Parent Company		1,209,950,428,355			2,670,522,873,044
Deduction: Dividends on hybrid securities		(28,650,200,000	)		(51,183,400,000	)

Profit attributable to the ordinary equity holders of the Parent Company (A)		1,181,300,228,355			2,619,339,473,044
Weighted average number of ordinary shares outstanding (B)		389,634,335			389,634,335

Basic earnings per share (A/B)		3,032			6,723

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

29.2 Diluted Earnings per Share

Diluted earnings per share is calculated through increasing the weighted average number of ordinary shares outstanding by the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares. The Group has dilutive potential ordinary shares such as stock grants and ordinary share exchange right of exchangeable bonds.

A calculation is done to determine the number of shares that could have been acquired at fair value (determined as the average market share price during the period) based on the monetary value of stock grants. The number of shares calculated above is compared with the number of shares that would have been issued assuming the settlement of stock grants.

Exchangeable bonds are included in potential ordinary shares from the exercisable date of the exchange right, and interest expense after tax for the period is added to profit for diluted earnings per share.

29.2.1 Adjusted profit for diluted earnings per share


(In Korean won)	2023
	Three months			Six months
Profit attributable to shareholders of the Parent Company		1,499,055,844,747			2,996,686,806,722
Deduction: Dividends on hybrid securities		(48,070,325,000	)		(88,774,400,000	)

Profit attributable to ordinary equity holders of the Parent Company		1,450,985,519,747			2,907,912,406,722
Adjustments: Interest expense on exchangeable bonds		611,283,413			1,215,849,425

Adjusted profit for diluted earnings per share		1,451,596,803,160			2,909,128,256,147


(In Korean won)	2022
	Three months			Six months
Profit attributable to shareholders of the Parent Company		1,209,950,428,355			2,670,522,873,044
Deduction: Dividends on hybrid securities		(28,650,200,000	)		(51,183,400,000	)

Profit attributable to ordinary equity holders of the Parent Company		1,181,300,228,355			2,619,339,473,044
Adjustments: Interest expense on exchangeable bonds		593,607,663			1,180,692,166

Adjusted profit for diluted earnings per share		1,181,893,836,018			2,620,520,165,210

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

29.2.2 Weighted average number of ordinary shares outstanding for diluted earnings per share


(In number of shares)	2023				2022
	Three months		Six months		Three months		Six months
Weighted average number of ordinary shares outstanding		384,248,339		386,170,890		389,634,335		389,634,335
Adjustment:
Stock grants		3,686,627		4,099,113		3,676,844		4,135,955
Exchangeable bonds		5,000,000		5,000,000		5,000,000		5,000,000

Adjusted weighted average number of ordinary shares outstanding for diluted earnings per share		392,934,966		395,270,003		398,311,179		398,770,290

29.2.3 Diluted earnings per share


(In Korean won and in number of shares)	2023
	Three months		Six months
Adjusted profit for diluted earnings per share		1,451,596,803,160		2,909,128,256,147
Adjusted weighted average number of ordinary shares outstanding for diluted earnings per share		392,934,966		395,270,003

Diluted earnings per share		3,694		7,360


(In Korean won and in number of shares)	2022
	Three months		Six months
Adjusted profit for diluted earnings per share		1,181,893,836,018		2,620,520,165,210
Adjusted weighted average number of ordinary shares outstanding for diluted earnings per share		398,311,179		398,770,290

Diluted earnings per share		2,967		6,572

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30. Insurance Contracts

30.1 Details of insurance contract assets and insurance contract liabilities as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)
	June 30, 2023
	Life insurance												Non-life insurance
	Death			Health			Pension		Variables		Compound		Long-term		General		Automobile		Overseas
Insurance contract assets		—			—			—		—		—		171,091		18,123		—		—
Insurance contract liabilities		10,932,254			356,749			6,897,999		6,020,310		—		18,567,015		1,596,760		2,209,187		260,593

Net insurance contract liabilities		10,932,254			356,749			6,897,999		6,020,310		—		18,395,924		1,578,637		2,209,187		260,593

Reinsurance contract assets		66			(90	)		—		—		3,968		389,543		1,008,288		15,236		112,416
Reinsurance contract liabilities		13,629			16,783			—		—		—		—		3,379		—		—

Net reinsurance contract assets		(13,563	)		(16,873	)		—		—		3,968		389,543		1,004,909		15,236		112,416

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.1 Details of insurance contract assets and insurance contract liabilities as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)
	December 31, 2022
	Life insurance												Non-life insurance
	Death			Health			Pension		Variables		Compound		Long-term		General		Automobile		Overseas
Insurance contract assets		—			—			—		—		—		78,687		4,617		—		—
Insurance contract liabilities		10,518,422			327,144			7,315,863		5,698,737		—		18,195,275		1,469,824		2,172,574		222,173

Net insurance contract liabilities		10,518,422			327,144			7,315,863		5,698,737		—		18,116,588		1,465,207		2,172,574		222,173

Reinsurance contract assets		837			—			—		—		3,827		381,733		1,014,266		31,750		63,553
Reinsurance contract liabilities		12,008			16,572			—		—		—		—		3,148		—		—

Net reinsurance contract assets		(11,171	)		(16,572	)		—		—		3,827		381,733		1,011,118		31,750		63,553

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.2 Details of insurance service results for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Life insurance														Non-life insurance								Total
	Death			Health			Pension			Variables			Compound		Long-term		General		Automobile		Overseas		Total
Insurance revenue:
Insurance contracts not applying the premium allocation approach:
Expected insurance claims and expenses		125,491			16,304			18,487			42,805			—		2,036,205		—		—		—		2,239,292
Changes in risk adjustment due to release of risk		8,673			1,433			2,502			2,481			—		91,225		—		—		—		106,314
Contractual service margin recognized in profit or loss for the services provided		144,253			9,686			16,509			44,581			—		398,749		—		—		—		613,778
Experience adjustments on premium related to current and past services		—			—			—			—			—		—		—		—		—		—
Recovery of insurance acquisition cash flows		6,416			1,335			2,713			2,427			—		80,341		—		—		—		93,232
Other insurance revenues		(505	)		(141	)		(200	)		(545	)		—		—		—		—		—		(1,391	)

		284,328			28,617			40,011			91,749			—		2,606,520		—		—		—		3,051,225

Insurance revenue for insurance contracts applying the premium allocation approach		—			—			—			—			—		—		632,959		1,328,275		49,519		2,010,753

Total insurance revenue		284,328			28,617			40,011			91,749			—		2,606,520		632,959		1,328,275		49,519		5,061,978

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.2 Details of insurance service results for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2023
	Life insurance														Non-life insurance												Total
	Death			Health			Pension			Variables			Compound		Long-term			General			Automobile			Overseas			Total
Insurance service expenses:
Incurred claims and expenses		(109,647	)		(16,647	)		(16,113	)		(40,400	)		—		(2,023,570	)		(650,915	)		(1,111,436	)		(91,271	)		(4,059,999	)
Amortization of insurance acquisition cash flows		(6,416	)		(1,335	)		(2,713	)		(2,427	)		—		(73,403	)		(62,801	)		(151,542	)		(1,323	)		(301,960	)
Changes in fulfilment cash flows relating to incurred claims		(4,595	)		(2,776	)		(1,999	)		(2,407	)		—		5,049			247,029			14,842			—			255,143
Losses on onerous contracts and reversals		(1,450	)		1,027			(2,375	)		(4,604	)		—		(6,412	)		1,090			—			—			(12,724	)
Other insurance service expenses		288			81			(1,313	)		(385	)		—		—			—			—			—			(1,329	)

Insurance service expenses for insurance contracts not applying the premium allocation approach		(121,820	)		(19,650	)		(24,513	)		(50,223	)		—		(2,098,336	)		—			—			—			(2,314,542	)
Insurance service expenses for insurance contracts applying the premium allocation approach		—			—			—			—			—		—			(465,597	)		(1,248,136	)		(92,594	)		(1,806,327	)

Total insurance service expenses		(121,820	)		(19,650	)		(24,513	)		(50,223	)		—		(2,098,336	)		(465,597	)		(1,248,136	)		(92,594	)		(4,120,869	)

Reinsurance income:
Recovery of incurred reinsurance claims and expenses		154			803			—			—			652		60,766			374,205			385			54,441			491,406
Changes in fulfilment cash flows relating to incurred claims		(155	)		(147	)		—			—			486		8,693			(226,982	)		1,811			—			(216,294	)
Recognition and reversal of loss-recovery component		1			(3	)		—			—			189		429			(207	)		—			—			409
Other reinsurance income		—			—			—			—			—		—			—			—			—			—

Reinsurance income for reinsurance contracts not applying the premium allocation approach		—			653			—			—			1,327		68,672			—			—			—			70,652
Reinsurance income for reinsurance contracts applying the premium allocation approach		—			—			—			—			—		1,216			147,016			2,196			54,441			204,869

Total reinsurance income		—			653			—			—			1,327		69,888			147,016			2,196			54,441			275,521

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.2 Details of insurance service results for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2023
	Life insurance													Non-life insurance												Total
	Death			Health			Pension		Variables		Compound			Long-term			General			Automobile			Overseas			Total
Reinsurance expense:
Reinsurance contracts not applying the premium allocation approach:
Expected recovery of incurred claims and expenses		(448	)		(1,146	)		—		—		(661	)		(73,408	)		—			—			—			(75,663	)
Changes in risk adjustment due to release of risk		(61	)		(74	)		—		—		(25	)		(4,099	)		—			—			—			(4,259	)
Contractual service margin recognized in profit or loss for the services received		(522	)		(410	)		—		—		(527	)		2,240			—			—			—			781
Experience adjustments on reinsurance premium related to current and past services		—			—			—		—		—			—			—			—			—			—
Other reinsurance expenses		7			4			—		—		99			—			—			—			—			110

		(1,024	)		(1,626	)		—		—		(1,114	)		(75,267	)		—			—			—			(79,031	)

Reinsurance expenses for reinsurance contracts applying the premium allocation approach		—			—			—		—		—			(837	)		(297,413	)		(5,322	)		(21,906	)		(325,478	)

Total reinsurance expense		(1,024	)		(1,626	)		—		—		(1,114	)		(76,104	)		(297,413	)		(5,322	)		(21,906	)		(404,509	)

Total insurance service result		161,484			7,994			15,498		41,526		213			501,968			16,965			77,013			(10,540	)		812,121

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.2 Details of insurance service results for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2022
	Life insurance														Non-life insurance								Total
	Death			Health			Pension			Variables			Compound		Long-term		General		Automobile		Overseas		Total
Insurance revenue:
Insurance contracts not applying the premium allocation approach:
Expected insurance claims and expenses		122,356			14,469			18,454			40,195			—		1,828,523		—		—		—		2,023,997
Changes in risk adjustment due to release of risk		8,165			829			2,338			1,353			—		82,428		—		—		—		95,113
Contractual service margin recognized in profit or loss for the services provided		106,376			8,273			12,732			39,183			—		353,167		—		—		—		519,731
Experience adjustments on premium related to current and past services		—			—			—			—			—		—		—		—		—		—
Recovery of insurance acquisition cash flows		5,335			606			1,762			2,323			—		63,464		—		—		—		73,490
Other insurance revenues		(281	)		(128	)		(98	)		(185	)		—		—		—		—		—		(692	)

		241,951			24,049			35,188			82,869			—		2,327,582		—		—		—		2,711,639

Insurance revenue for insurance contracts applying the premium allocation approach		—			—			—			—			—		—		618,693		1,260,321		50,642		1,929,656

Total insurance revenue		241,951			24,049			35,188			82,869			—		2,327,582		618,693		1,260,321		50,642		4,641,295

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.2 Details of insurance service results for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2022
	Life insurance															Non-life insurance												Total
	Death			Health			Pension			Variables			Compound			Long-term			General			Automobile			Overseas			Total
Insurance service expenses:
Incurred claims and expenses		(117,831	)		(14,151	)		(18,685	)		(39,529	)		—			(1,785,306	)		(497,749	)		(1,018,294	)		(39,499	)		(3,531,044	)
Amortization of insurance acquisition cash flows		(5,335	)		(606	)		(1,762	)		(2,323	)		—			(86,493	)		(58,642	)		(145,124	)		(1,057	)		(301,342	)
Changes in fulfilment cash flows relating to incurred claims		(3,446	)		(25	)		2,635			796			—			97,638			132,479			16,546			—			246,623
Losses on onerous contracts and reversals		(946	)		(554	)		4,135			(16,176	)		—			(14,574	)		1			—			—			(28,114	)
Other insurance service expenses		(822	)		(162	)		1,157			(280	)		—			—			—			—			—			(107	)

Insurance service expenses for insurance contracts not applying the premium allocation approach		(128,380	)		(15,498	)		(12,520	)		(57,512	)		—			(1,788,735	)		—			—			—			(2,002,645	)

Insurance service expenses for insurance contracts applying the premium allocation approach		—			—			—			—			—			—			(423,911	)		(1,146,872	)		(40,556	)		(1,611,339	)

Total insurance service expenses		(128,380	)		(15,498	)		(12,520	)		(57,512	)		—			(1,788,735	)		(423,911	)		(1,146,872	)		(40,556	)		(3,613,984	)

Reinsurance income:
Recovery of incurred reinsurance claims and expenses		676			703			—			—			1,554			35,828			233,677			3,245			(28,072	)		247,611
Changes in fulfilment cash flows relating to incurred claims		15			(125	)		—			—			(454	)		(10,392	)		(95,811	)		530			—			(106,237	)
Recognition and reversal of loss-recovery component		(398	)		13			—			—			35			1,890			(40	)		—			—			1,500
Other reinsurance income		(2	)		(4	)		—			—			(45	)		—			—			—			—			(51	)

Reinsurance income for reinsurance contracts not applying the premium allocation approach		291			587			—			—			1,090			27,042			1,518			—			—			30,528

Reinsurance income for reinsurance contracts applying the premium allocation approach		—			—			—			—			—			284			136,308			3,775			(28,072	)		112,295

Total reinsurance income		291			587			—			—			1,090			27,326			137,826			3,775			(28,072	)		142,823

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.2 Details of insurance service results for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2022
	Life insurance													Non-life insurance												Total
	Death			Health			Pension		Variables		Compound			Long-term			General			Automobile			Overseas			Total
Reinsurance expense:
Reinsurance contracts not applying the premium allocation approach:

Expected recovery of incurred claims and expenses		(454	)		(734	)		—		—		(618	)		(57,053	)		—			—			—			(58,859	)

Changes in risk adjustment due to release of risk		(33	)		(80	)		—		—		(25	)		(2,831	)		—			—			—			(2,969	)
Contractual service margin recognized in profit or loss for the services received		208			(122	)		—		—		(420	)		(3,472	)		—			—			—			(3,806	)
Experience adjustments on reinsurance premium related to current and past services		—			—			—		—		—			—			—			—			—			—
Other reinsurance expenses		433			4			—		—		45			—			—			—			—			482

		154			(932	)		—		—		(1,018	)		(63,356	)		—			—			—			(65,152	)

Reinsurance expenses for reinsurance contracts applying the premium allocation approach		—			—			—		—		—			(420	)		(284,723	)		(5,653	)		1,385			(289,411	)

Total reinsurance expense		154			(932	)		—		—		(1,018	)		(63,776	)		(284,723	)		(5,653	)		1,385			(354,563	)

Total insurance service result		114,016			8,206			22,668		25,357		72			502,397			47,885			111,571			(16,601	)		815,571

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.3 Details of other insurance finance income and expenses for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Life insurance								Non-life insurance											Total
	Retirement		Variables			Others			Long-term			General and Automobile			Overseas			Others		Total
Insurance finance income (expenses)
Insurance finance income (expenses) recognized in profit or loss:
Effect of changes in discount rates and financial assumptions		—		(228,644	)		39,029			—			—			—			—		(189,615	)
Effect of exchange rate fluctuations		—		(23,196	)		(5,816	)		—			(15,468	)		—			—		(44,480	)
Other insurance finance income (expenses)		—		—			—			44			(1,201	)		(17	)		—		(1,174	)

		—		(251,840	)		33,213			44			(16,669	)		(17	)		—		(235,269	)

Insurance finance income (expenses) recognized in other comprehensive income		—		28,163			(74,835	)		(212,521	)		(8,784	)		—			—		(267,977	)

Total insurance finance income (expenses)		—		(223,677	)		(41,622	)		(212,477	)		(25,453	)		(17	)		—		(503,246	)

Reinsurance finance income (expenses)
Reinsurance finance income (expenses) recognized in profit or loss:
Effect of changes in discount rates and financial assumptions		—		—			(100	)		—			—			—			—		(100	)
Effect of exchange rate fluctuations		—		—			(23	)		—			12,563			—			—		12,540
Other reinsurance finance income (expenses)		—		—			—			650			1,042			(12	)		—		1,680

		—		—			(123	)		650			13,605			(12	)		—		14,120

Reinsurance finance income (expenses) recognized in other comprehensive income		—		—			(640	)		12,781			8,834			—			—		20,975

Total reinsurance finance income (expenses)		—		—			(763	)		13,431			22,439			(12	)		—		35,095

Total		—		(223,677	)		(42,385	)		(199,046	)		(3,014	)		(29	)		—		(468,151	)

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

30.3 Details of other insurance finance income and expenses for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2022
	Life insurance								Non-life insurance											Total
	Retirement		Variables			Others			Long-term			General and Automobile			Overseas			Others		Total
Insurance finance income (expenses)
Insurance finance income (expenses) recognized in profit or loss:
Effect of changes in discount rates and financial assumptions		—		710,284			10,599			—			—			—			—		720,883
Effect of exchange rate fluctuations		—		(59,807	)		(9,745	)		—			(29,188	)		—			—		(98,740	)
Other insurance finance income (expenses)		—		—			—			(6,655	)		645			(1,927	)		—		(7,937	)

		—		650,477			854			(6,655	)		(28,543	)		(1,927	)		—		614,206

Insurance finance income (expenses) recognized in other comprehensive income		—		273,345			3,358,387			3,474,204			4,104			—			—		7,110,040

Total insurance finance income (expenses)		—		923,822			3,359,241			3,467,549			(24,439	)		(1,927	)		—		7,724,246

Reinsurance finance income (expenses)
Reinsurance finance income (expenses) recognized in profit or loss:
Effect of changes in discount rates and financial assumptions		—		—			(251	)		—			—			—			—		(251	)
Effect of exchange rate fluctuations		—		—			(48	)		—			25,495			—			—		25,447
Other reinsurance finance income (expenses)		—		—			(10	)		4,676			9,904			1,780			—		16,350

		—		—			(309	)		4,676			35,399			1,780			—		41,546

Reinsurance finance income (expenses) recognized in other comprehensive income		—		—			3,554			(53,482	)		(2,705	)		—			—		(52,633	)

Total reinsurance finance income (expenses)		—		—			3,245			(48,806	)		32,694			1,780			—		(11,087	)

Total		—		923,822			3,362,486			3,418,743			8,255			(147	)		—		7,713,159

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

31. Statement of Cash Flows

31.1 Details of cash and cash equivalents as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Cash		2,334,860			2,439,490
Checks issued by other banks		242,668			123,163
Due from the Bank of Korea		17,370,997			17,520,636
Due from other financial institutions		11,662,325			12,391,461

		31,610,850			32,474,750

Due from financial institutions measured at fair value through profit or loss		103,567			69,469

		31,714,417			32,544,219

Deduction:
Restricted due from financial institutions		(4,221,185	)		(4,893,839	)
Due from financial institutions with original maturities over three months		(936,349	)		(1,115,582	)

		(5,157,534	)		(6,009,421	)

		26,556,883			26,534,798

31.2 Cash inflows and outflows from income tax, interest, and dividends for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	Activities	2023		2022
Income tax paid	Operating		1,278,850		820,791
Interest received	Operating		13,736,683		8,401,269
Interest paid	Operating		5,313,053		2,227,189
Dividends received	Operating		156,371		174,296
Dividends paid	Financing		849,711		1,099,300

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

32. Contingent Liabilities and Commitments

32.1 Details of acceptances and guarantees as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Confirmed acceptances and guarantees
Confirmed acceptances and guarantees in Korean won:
Acceptances and guarantees for KB purchasing loan		159,227		167,538
Others		918,549		918,670

		1,077,776		1,086,208

Confirmed acceptances and guarantees in foreign currencies:
Acceptances of letter of credit		409,353		502,217
Letter of guarantees		69,957		78,414
Bid bond		17,510		19,998
Performance bond		1,129,267		976,008
Refund guarantees		3,313,130		1,705,796
Others		3,580,690		3,485,842

		8,519,907		6,768,275

Financial guarantee contracts:
Acceptances and guarantees for issuance of debentures		5,040		5,040
Acceptances and guarantees for mortgage		95,217		94,861
Overseas debt guarantees		595,113		509,157
International financing guarantees in foreign currencies		641,711		181,241

		1,337,081		790,299

		10,934,764		8,644,782

Unconfirmed acceptances and guarantees
Guarantees of letter of credit		2,941,942		3,042,911
Refund guarantees		1,511,223		1,528,359

		4,453,165		4,571,270

		15,387,929		13,216,052

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

32.2 Details of commitments as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Commitments
Corporate loan commitments		52,538,753		51,871,280
Retail loan commitments		54,377,913		51,241,471
Credit line of credit cards		81,297,800		77,825,953
Purchase of other securities		7,532,512		7,357,198

		195,746,978		188,295,902

Financial guarantee contracts
Credit line		7,058,192		7,135,542
Purchase of securities		891,000		371,201

		7,949,192		7,506,743

		203,696,170		195,802,645

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

32.3 Other Matters

a) The Group has 359 pending lawsuits as a plaintiff (excluding simple lawsuits related to the collection or management of loans), with aggregate claims amount of 1,497,946 million, and 329 pending lawsuits as a defendant (excluding simple lawsuits related to the collection or management of loans) with aggregate claims amount of 1,048,269 million, which arose in the normal course of the business, as of June 30, 2023. Details of major pending lawsuits in which the Group is a defendant are as follows:

(In number of cases, in millions of Korean won)

Company

Lawsuits

No. of
cases

Amount

Description of the lawsuits

Status of the lawsuits

Kookmin Bank

Request for a return of redemption amount

55,151

Kookmin Bank invested the assets entrusted by OO Asset Management and OO Investment Trust Management in the Fairfield Sentry Limited(the Fairfield Sentry Limited reinvested the assets in Bernard L. Madoff Investment Securities LLC managed by Bernard Madoff) and then redeemed them and returned them to the beneficiaries. 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 dismissal by the defendant has been denied, and further proceedings are scheduled. [Related litigation is in progress at the New York Southern District Federal Bankruptcy Court
(10-3777) at the written complaint review stage]

Expropriation of long-term leasehold rights

328,200

Kookmin Bank invested assets entrusted by OO Asset Management Co., Ltd. in loans that are directly or indirectly collateralized by long-term leasehold rights of 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 those concerned with the real estate in this case, including Kookmin Bank, to expropriate the real estate in this case and determine indemnity.

Kookmin Bank submitted the response letter and will proceed with the process in the future.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

32.3 Other Matters (cont’d)

(In number of cases, in millions of Korean won)

Company

Lawsuits

No. of
cases

Amount

Description of the lawsuits

Status of the lawsuits

Kookmin Bank

Claim for damages

92,466

PT Bank KB Bukopin Tbk requested an auction of TMJ’s shares in order to collect the loan to TMJ (a distressed company); NKLI won the auction and then received a loan from the bank for the purpose of purchasing TMJ shares. NKLI’s intention was to take control over TMJ and launch mining business; however, NKLI was unable to take control and launch the business due to legal disputes with the bankruptcy trustee of TMJ and court-appointed mine management company, and also lost a lawsuit against the mine management company.

As a result, NKLI filed a legal suit to PT Bank KB Bukopin Tbk stating that the bank’s recommendation to purchase TMJ’s shares was inappropriate since the bank did not intentionally share the legal issues and associated risks thereof.

A legal representative has been appointed to handle the case, and the legal proceedings will proceed.

KB Securities Co., Ltd.

Request for a return of transaction amount (Australian fund)

37,468

The plaintiffs OOOO Securities and OOOO Life Insurance filed lawsuits, claiming that the KB Securities Co., Ltd. provided false information on major matters in the product description while selling JB Australia NDIS Private Fund No.1 (on April 25, 2019, plaintiffs invested 50 billion each) (a) (Primary claim) requesting KB Securities Co., Ltd. to return unjust enrichment of 100 billion for cancelation of sales contracts of beneficiary certificates due to an error or termination of the contract due to default, (b) (Secondary claim) requesting for compensation for damages in investments amounting to 100 billion due to violation of the investor protection obligation and fraudulent transactions of KB Securities Co., Ltd. and OOO Asset Management.

The Plaintiff’s complaint price was changed to 37.47 billion due to the Plaintiff’s request to change the purpose and cause of the claim on October 11, 2022.

First trial is in progress (the pleading resumption has been decided on April 11, 2023, and the 9th pleading is scheduled on September 20, 2023).

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

32.3 Other Matters (cont’d)

b) On April 7, 2023, Kookmin Bank entered into a new share subscription agreement with STIC Eugene Star Holdings Inc.(hereinafter referred to as STIC”), under which STIC will acquire 31,900,000,000 shares at a price of IDR 3.19 trillion, of which Kookmin Bank’s subsidiary, PT Bank KB Bukopin Tbk, will issue. As a result of the agreement, Kookmin Bank will hold a call option to purchase the shares held by the STIC, starting from 2 years and 6 months after the date of acquisition, for a period of 6 months. If Kookmin Bank does not exercise the call option during the designated period, STIC will have the right to sell the acquired shares back to the bank, also known as holding a put option right, within 1 year after the expiration of the call option period.

c) In June 2013, KB Kookmin Card Co., Ltd. had an accident in which cardholders’ personal information was stolen (hereinafter referred to as “accident”) due to illegal activities by employees of personal credit information company in charge of development of the system upgrading to prevent fraudulent use of credit card. As a result, KB Kookmin Card Co., Ltd. was notified by the Financial Services Commission of the suspension of some new business for 3 months as of February 16, 2014. In respect of the accident, the Group faces 1 legal claims filed as a defendant, with an aggregate claim amount of 51 million as of December 31, 2022.

d) As of June 30, 2023, KB KOLAO Leasing Co., Ltd. is selling LVMC Holdings (formerly Kolao Holdings) allied receivables that are overdue by three months or more to Lanexang Leasing Co., Ltd. in accordance with the agreement.

e) As of June 30, 2023, KB Capital Co., Ltd. and PT Sunindo Primasura are required to hold the shares of PT Sunindo Kookmin Best Finance for five years after May 18, 2020, when the purchase of shares was completed. If one party is going to sell all or part of the shares, provide them as collateral, trade or dispose of them, it should give the opportunity to exercise preemption to the other party by providing written proposal including transfer price, payment method, and others.

f) KB Securities Co., Ltd., as an investment broker, managed the sale of private equity funds and trusts amounting to 326,500 million, which lends to corporations (borrowers) that invest in apartment rental businesses for the disabled in Australia, to individuals and institutional investors. However, management of the fund has been suspended due to the breach of contract by local borrowers in Australia; therefore there is a possibility of losses of principal to these funds subscribers. In this regard, there are three lawsuits in which the KB Securities Co., Ltd., is a defendant as of June 30, 2023. One of the cases was ruled in 2023, ordering the payment of 29,800 million in principal and delayed interest on it; however, the judgment may be changed at the higher court. And the other two cases are still in the first trial.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

32.3 Other Matters (cont’d)

g) In relation to Lime Asset Management, KB Securities Co., Ltd. has a PIS (Portfolio Index Swap) contract, as of June 30, 2023, associated with ‘Lime Thetis Qualified Investor Private Investment Trust No.2’ and ‘Lime Pluto FI Qualified Investor Private Investment Trust No.D-1’ whose redemption were suspended during the fourth quarter of 2019. The notional amount of the underlying assets of the PIS contract is 152,100 million. Meanwhile, the KB Securities Co., Ltd., sold 68,100 million of feeder funds of aforementioned redemption-suspended funds. On October 20, 2020, Lime Asset Management’s license as a fund manager was revoked by the Financial Supervisory Service’s sanctions review committee, and most of its redemption-suspended funds and normal funds have been transferred to Wellbridge Asset Management (the bridge management company) to continue to collect and distribute investments. It is difficult to predict whether and when the aforementioned redemption-suspended funds will be redeemed. In this regard, KB Securities Co., Ltd. faces four claims filed as a defendant as of June 30, 2023. The Group has accounted for the estimated loss due to the possibility of additional lawsuits in the future as a provision for litigations.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

33. Subsidiaries

33.1 Details of major consolidated subsidiaries as of June 30, 2023, are as follows:

Investor

Investee

Ownership
(%)

Location

Date of
financial
statements

Industry

KB Financial Group Inc.

Kookmin Bank

100.00

Korea

Jun. 30

Banking and foreign exchange transaction

KB Securities Co., Ltd.

100.00

Korea

Jun. 30

Financial investment

KB Insurance Co., Ltd.

100.00

Korea

Jun. 30

Non-life insurance

KB Kookmin Card Co., Ltd.

100.00

Korea

Jun. 30

Credit card and installment financing

KB Life Insurance Co., Ltd. 1

100.00

Korea

Jun. 30

Life insurance

KB Asset Management Co., Ltd.

100.00

Korea

Jun. 30

Collective investment and advisory

KB Capital Co., Ltd.

100.00

Korea

Jun. 30

Financial Leasing

KB Real Estate Trust Co., Ltd.

100.00

Korea

Jun. 30

Real estate trust management

KB Savings Bank Co., Ltd.

100.00

Korea

Jun. 30

Savings banking

KB Investment Co., Ltd.

100.00

Korea

Jun. 30

Capital investment

KB Data System Co., Ltd.

100.00

Korea

Jun. 30

Software advisory, development, and supply

Kookmin Bank

Kookmin Bank Cambodia Plc. 3

100.00

Cambodia

Jun. 30

Banking and foreign exchange transaction

Kookmin Bank (China) Ltd.

100.00

China

Jun. 30

Banking and foreign exchange transaction

KB Microfinance Myanmar Co., Ltd.

100.00

Myanmar

Jun. 30

Microfinance services

PRASAC Microfinance Institution PLC. 3

100.00

Cambodia

Jun. 30

Microfinance services

PT Bank Syariah Bukopin

92.78

Indonesia

Jun. 30

Banking

PT Bukopin Finance

97.03

Indonesia

Jun. 30

Installment financing

KB Bank Myanmar Co., Ltd.

100.00

Myanmar

Jun. 30

Banking and foreign exchange transaction

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

33.1 Details of major consolidated subsidiaries as of June 30, 2023, are as follows: (cont’d)

Investor

Investee

Ownership
(%)

Location

Date of
financial
statements

Industry

Kookmin Bank , KB Kookmin Card Co., Ltd, KB Securities Co., Ltd., KB Insurance Co., Ltd., KB Capital Co., Ltd

PT Bank KB Bukopin, Tbk. 2

67.57

Indonesia

Jun. 30

Banking and foreign exchange transaction

KB Securities Co., Ltd.

KBFG Securities America Inc.

100.00

United
States

Jun. 30

Investment advisory and securities trading

KB Securities Hong Kong Ltd.

100.00

China

Jun. 30

Investment advisory and securities trading

KB Securities Vietnam Joint Stock Company

99.81

Vietnam

Jun. 30

Investment advisory and securities trading

KB FINA Joint Stock Company

77.82

Vietnam

Jun. 30

Investment advisory and securities trading

PT KB VALBURY SEKURITAS

65.00

Indonesia

Jun. 30

Investment advisory and securities trading

PT.KB Valbury Capital Management

79.00

Indonesia

Jun. 30

Financial investment

KB Insurance Co., Ltd.

Leading Insurance Services, Inc.

100.00

United
States

Jun. 30

Management service

KBFG Insurance(China) Co., Ltd.

100.00

China

Jun. 30

Non-life insurance

PT. KB Insurance Indonesia

70.00

Indonesia

Jun. 30

Non-life insurance

KB Claims Survey & Adjusting

100.00

Korea

Jun. 30

Claim service

KB Sonbo CNS

100.00

Korea

Jun. 30

Management service

KB Golden Life Care Co., Ltd.

100.00

Korea

Jun. 30

Service

KB Healthcare Co., Ltd.

100.00

Korea

Jun. 30

Information and communication

KB Life Insurance Co., Ltd.

KB Life Partners Co., Ltd.

100.00

Korea

Jun. 30

Insurance agent

KB Kookmin Card Co., Ltd.

KB Credit Information

100.00

Korea

Jun. 30

Collection of receivables or credit

KB Daehan Specialized Bank Plc.

97.50

Cambodia

Jun. 30

Auto Installment finance

PT. KB Finansia Multi Finance

80.00

Indonesia

Jun. 30

Auto Installment finance

KB J Capital Co., Ltd.

50.99

Thailand

Jun. 30

Service

i-Finance Leasing Plc.

100.00

Cambodia

Jun. 30

Leasing

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

33.1 Details of major consolidated subsidiaries as of June 30, 2023, are as follows: (cont’d)

Investor

Investee

Ownership
(%)

Location

Date of
financial
statements

Industry

KB Capital Co., Ltd.

PT Sunindo Kookmin Best Finance

85.00

Indonesia

Jun. 30

Auto Installment finance

KB Kookmin Card Co., Ltd. KB Capital Co., Ltd.

KB KOLAO Leasing Co., Ltd.

80.00

Laos

Jun. 30

Auto Installment finance

Kookmin Bank, KB Data System Co., Ltd.

PT KB Data Systems Indonesia

100.00

Indonesia

Jun. 30

Service

KB Asset Management Co., Ltd.

KBAM Shanghai Advisory Services Co., Ltd.

100.00

China

Jun. 30

General advisory

KB Asset Management Singapore PTE. LTD.

100.00

Singapore

Jun. 30

Collective investment

1	Prudential Life Insurance Company of Korea Ltd. has changed its name into KB Life Insurance Co., Ltd.

2	Among the ownership in PT Bank KB Bukopin, Tbk., 0.05% (100,000,000 shares) is no-voting shares with no-dividends.

As of the reporting date, the merger between PRASAC Microfinance Institution PLC.(merging entity) and Kookmin Bank Cambodia PLC.(merged entity) is on the process. The agreement for the merger is engaged as of July 10, 2023, and approved by the Ministry of Commence of Cambodia as of August 4, 2023; the official name of PRASAC Microfinance Institution PLC.(merging entity) has changed to KB PRASAC BANK PLC.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

33.2 Details of consolidated structured entities as of June 30, 2023, are as follows:


	Consolidated structured entities	Reasons for consolidation
Trusts	Kookmin Bank (development trust) and 10 others	The Group controls the trust because it has power to determine management performance of the trust and is significantly exposed to variable returns that absorb losses through the guarantees of payment of principal, or payment of principal and fixed rate of return.

Asset-backed securitization	Taejon Samho The First Co., Ltd. and 116 others	The Group controls these investees because it has power over relevant activities in the event of default, is significantly exposed to variable returns by providing lines of credit, ABCP purchase commitments or acquisition of subordinated debt and has ability to affect those returns through its power.

Investment funds and others	KB Global Platform Fund No.2 and 201 others	Funds are consolidated if the Group, as a collective investor or operating manager (member), etc., can manage fund assets on behalf of other investors, or dismiss the collective investor and operating manager, and is substantially exposed to significant variable returns or has such rights.

If the Group holds more than half of the ownership interests but does not have the power over relevant activities of structured entities in accordance with agreements with trust and other related parties, those structured entities are excluded from the consolidation.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

33.3 Condensed financial information of major subsidiaries as of June 30, 2023 and December 31, 2022 and for the six-month periods ended June 30, 2023 and 2022, are as follows:

(In millions of Korean won)


	June 30, 2023						2023
	Assets		Liabilities		Equity		Operating revenue		Profit (loss) attributable to shareholders of the Parent Company			Total compre- hensive income (loss) attributable to shareholders of the Parent Company
Kookmin Bank 1		524,504,515		489,546,010		34,958,505		23,736,807		1,858,508			1,281,320
KB Securities Co., Ltd. 1,2		63,012,588		56,885,591		6,126,997		6,126,291		249,574			240,616
KB Insurance Co., Ltd. 1,2		35,349,569		29,353,391		5,996,178		5,948,834		525,218			619,817
KB Kookmin Card Co., Ltd.1		29,255,854		24,552,729		4,703,125		2,077,637		192,855			188,900
KB Life Insurance Co., Ltd. 1,2,3,4		30,074,809		25,953,985		4,120,824		1,532,657		122,743			39,916
KB Asset Management Co., Ltd. 1		316,187		77,967		238,220		101,185		31,583			31,703
KB Capital Co., Ltd. 1,2		16,018,070		13,822,130		2,195,940		1,102,390		105,360			102,610
KB Real Estate Trust Co., Ltd. 1		560,634		154,728		405,906		71,665		35,370			35,369
KB Savings Bank Co., Ltd.		2,950,374		2,677,602		272,772		116,131		(11,171	)		(11,222	)
KB Investment Co., Ltd. 1		1,435,791		1,149,912		285,879		88,693		15,592			15,592
KB Data System Co., Ltd. 1		59,226		34,127		25,099		116,150		2,476			2,598

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

33.3 Condensed financial information of major subsidiaries as of June 30, 2023 and December 31, 2022 and for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)

(In millions of Korean won)


	December 31, 2022						2022
	Assets		Liabilities		Equity		Operating revenue		Profit (loss) attributable to shareholders of the Parent Company			Total compre- hensive income (loss) attributable to shareholders of the Parent Company
Kookmin Bank 1		517,769,512		484,046,253		33,723,259		24,877,552		1,726,440			537,774
KB Securities Co., Ltd. 1,2		53,824,246		47,946,933		5,877,313		8,987,763		182,030			251,926
KB Insurance Co., Ltd. 1,2		34,743,259		29,017,684		5,725,576		5,493,118		526,202			934,090
KB Kookmin Card Co., Ltd.1		29,721,017		24,998,215		4,722,802		1,802,096		245,657			279,513
KB Life Insurance Co., Ltd. (former Prudential Life Insurance Company of Korea Ltd.) 1,2,3,4		20,924,583		17,705,417		3,219,166		1,318,402		(39,256	)		515,432
KB Life Insurance Co., Ltd.		9,065,100		8,430,665		634,435		498,447		(28,301	)		(69,273	)
KB Asset Management Co., Ltd. 1		369,488		102,970		266,518		102,624		21,310			21,298
KB Capital Co., Ltd. 1,2		16,053,026		13,946,800		2,106,226		925,580		147,318			140,275
KB Real Estate Trust Co., Ltd.		518,980		113,444		405,536		71,469		35,052			35,052
KB Savings Bank Co., Ltd.		3,138,543		2,854,549		283,994		91,744		15,429			15,391
KB Investment Co., Ltd. 1		1,378,550		1,108,264		270,286		71,109		3,413			3,410
KB Data System Co., Ltd. 1		63,645		40,570		23,075		100,326		1,241			1,278
KB Credit Information Co., Ltd. 5		42,219		24,923		17,296		17,057		(943	)		(954	)

1	Financial information is based on its consolidated financial statements.

2	Includes fair value adjustments arising from the acquisition.

3	Prudential Life Insurance Company of Korea Ltd. and KB Life Insurance Co., Ltd, which were subsidiary companies, have merged in January 2023.

4	Prudential Life Insurance Company of Korea Ltd. changed the name to KB Life Insurance Co., Ltd.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

33.3 Condensed financial information of major subsidiaries as of June 30, 2023 and December 31, 2022 and for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)

5	The Parent Company sold 100% shares of KB Credit Information Co., Ltd. to KB Kookmin Card Co., Ltd. on June 30, 2023.

33.4 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:

33.4.1 The Group has provided payment guarantees of 4,603,836 million to K plus 1st LLC and other consolidated structured entities.

33.4.2 The Group has provided capital commitment to 56 consolidated structured entities including KB Sinansan Line Private Special Asset Fund (SOC). The unexecuted amount of the capital commitment is 1,954,645 million. Based on the capital commitment, the Group is subject to increase its investment upon the request of the asset management company or the additional agreement among investors.

33.4.3 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.

33.5 Changes in Subsidiaries

33.5.1 Subsidiaries newly included in consolidation for the six-month period ended June 30, 2023, are as follows:


Company		Reasons of obtaining control
Star road Alpha PFL General Asset Management Real Estate Investment Trust No.11 and 3 other		Holds more than half of the ownership interests

New star Copper 2nd Co., Ltd. and 17 others		Holds the power in the event of default and is exposed to significant variable returns by providing lines of credit, ABCP purchase commitments or acquisition of subordinated debt

KB Overseas Investment General Asset Management Real Estate Investment Trust and 10 others		Holds the power to determine the operation of the funds and is exposed to variable returns by holding significant amount of ownership interests

KB Global Platform Fund No.2 and 1 other		Holds the power as a general partner and is exposed to variable returns by holding significant amount of ownership interests

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

33.5.2 Subsidiaries excluded from consolidation for the six-month period ended June 30, 2023, are as follows:


Company		Reasons of losing control
KB Cheongra Hill Co., Ltd. and 19 others		Termination of the commitments

KB Life Insurance Co., Ltd. and 7 others		Liquidation

KB KBSTAR Treasury Futures 3 Year ETF Trust (Bond-Derivative) and 4 others		Disposal

KB Global Dynamic Securities Master Investment Trust (Equity-Indirect Type) and 5 others		Decrease in ownership interests to less than majority

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34. Related Party Transactions

According to Korean IFRS No.1024, the Group includes investments in associates, 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 12 for details of investments in associates and joint ventures.

34.1 Details of significant profit or loss arising from transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows:

(In millions of Korean won)


		2023		2022
Associates and joint ventures
Balhae Infrastructure Company	Fee and commission income		2,526		2,608
Korea Credit Bureau Co., Ltd.	Fee and commission income		395		424
	Fee and commission expense		4,021		2,009
	Insurance income		2		2
	Other operating expenses		8		9
Incheon Bridge Co., Ltd.	Interest income		4,331		2,591
	Interest expense		381		184
	Fee and commission income		13		2
	Fee and commission expense		3		3
	Insurance income		110		101
	Gains on financial instruments at fair value through profit or loss		521		—
	Losses on financial instruments at fair value through profit or loss		—		2,289
	Provision of credit losses		57		3
Aju Good Technology Venture Fund	Interest expense		107		30
KB Star Office Private Real Estate Master Fund No.1*	Interest income		—		183
	Interest expense		—		2
	Fee and commission income		—		216
Star-Lord General Investors Private Real Estate Investment Company No.10	Insurance income		69		25
	Interest income		2,944		140
	Interest expense		306		84
	General and administrative expenses		4,834		797
	Provision of credit losses		1		—
KG Capital Co., Ltd. *	Interest income		293		443
	Fee and commission income		18		25
	Fee and commission expense		1		6
	Insurance income		13		21
	Other operating income		—		269
	Other operating expenses		11		10
	Reversal of credit losses		55		—
	Provision for credit losses		—		4

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.1 Details of significant profit or loss arising from transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)

(In millions of Korean won)


		2023			2022
Food Factory Co., Ltd.	Interest income		38			41
	Interest expense		—			4
	Insurance income		5			5
	Fee and commission income		—			1
	Profit or loss-fair value measurement of financial instrument revenue		25			—
	Reversal of credit losses		2			1
KB Pre IPO Secondary Venture Fund No.1 *	Fee and commission income		—			8
Acts Co., Ltd.	Insurance income		—			1
DongJo Co., Ltd.	Interest income		10			—
POSCO-KB Shipbuilding Fund	Fee and commission income		(18	)		91
Paycoms Co., Ltd.	Interest income		4			5
	Profit or loss-fair value measurement of financial instrument revenue		78			—
Big Dipper Co., Ltd.	Fee and commission expense		152			259
KB-KDBC Pre-IPO New Technology Business Investment Fund	Interest expense		—			1
	Fee and commission income		—			72
KB-TS Technology Venture Private Equity Fund	Fee and commission income		218			126
KB-SJ Tourism Venture Fund	Fee and commission income		195			140
Banksalad Co., Ltd.	Fee and commission income		18			18
	Fee and commission expense		6			11
Iwon Alloy Co., Ltd.	Insurance income		1			1
RMGP Bio-Pharma Investment Fund, L.P.	Fee and commission income		21			26
KB-MDI Centauri Fund LP	Fee and commission income		242			230
Hibiscus Fund LP	Fee and commission income		669			258
RMG-KB BioAccess Fund L.P.	Fee and commission income		163			158
S&E Bio Co., Ltd.	Interest expense		11			—
Contents First Inc.	Interest income		113			—
	Interest expense		52			(7	)
	Provision for credit losses		3			—
December & Company Inc.	Insurance income		94			99
GENINUS Inc. *	Interest expense		—			13
	Provision for credit losses		—			3
Pin Therapeutics Inc.	Interest expense		84			64
Wyatt Co., Ltd.	Insurance income		61			75
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Interest expense		2			2
	Fee and commission income		142			—
Spark Biopharma Inc.	Interest expense		254			76
Skydigital Inc.	Fee and commission income		1			1

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.1 Details of significant profit or loss arising from transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)

(In millions of Korean won)


		2023		2022
IIkwang Electronic Materials Co., Ltd.	Other non-operating expenses		—		1
KB No.17 Special Purpose Acquisition Company *	Interest expense		—		1
KB No.18 Special Purpose Acquisition Company *	Interest expense		—		5
KB No.19 Special Purpose Acquisition Company *	Losses on financial instruments at fair value through profit or loss		—		1,092
	Interest expense		—		5
KB No.20 Special Purpose Acquisition Company *	Gains on financial instruments at fair value through profit or loss		—		297
	Interest expense		—		12
KB No.21 Special Purpose Acquisition Company	Gains on financial instruments at fair value through profit or loss		1,135		1,654
	Interest expense		29		1
KB No.22 Special Purpose Acquisition Company	Gains on financial instruments at fair value through profit or loss		177		—
	Interest expense		1		—
KB No.23 Special Purpose Acquisition Company	Gains on financial instruments at fair value through profit or loss		213		—
	Interest expense		33		—
KB No.24 Special Purpose Acquisition Company	Interest expense		5		—
	Gains on financial instruments at fair value through profit or loss		247		—
KB No.25 Special Purpose Acquisition Company	Interest expense		13		—
KB No.26 Special Purpose Acquisition Company	Interest expense		7		—
KB SPROTT Renewable Private Equity Fund No.1	Fee and commission income		158		173
KB-Stonebridge Secondary Private Equity Fund	Fee and commission income		336		346
COSES GT Co., Ltd.	Losses on financial instruments at fair value through profit or loss		4,910		—
	Interest income		25		10
	Interest expense		—		1
SuperNGine Co., Ltd.	Interest income		5		—
	Provision for credit losses		6		—
Desilo Inc.	Interest income		6		4
	Provision for credit losses		3		—
Turing Co., Ltd.	Interest expense		1		—
IGGYMOB Co., Ltd.	Interest expense		—		1

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.1 Details of significant profit or loss arising from transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)

(In millions of Korean won)


		2023		2022
Kukka Co., Ltd.	Interest expense		—		2
Grinergy Co., Ltd.	Provision for credit losses		1		—
TeamSparta Inc.	Interest expense		141		5
	Provision for credit losses		1		—
Chabot Mobility Co., Ltd.	Fee and commission expense		932		104
	Interest expense		—		1
Wemade Connect Co., Ltd.	Insurance income		1		1
	Interest expense		164		9
	Provision for credit losses		13		—
TMAP Mobility Co., Ltd.	Interest expense		256		—
	Fee and commission expense		539		—
	Provision for credit losses		11		—
Nextrade Co., Ltd.	Interest expense		1,444		—
WJ Private Equity Fund No.1	Fee and commission income		3		4
UPRISE, Inc.	Interest expense		—		2
Channel Corporation	Interest expense		37		—
CWhy Inc.	Insurance income		1		1
KB Social Impact Investment Fund	Fee and commission income		128		150
KB-UTC Inno-Tech Venture Fund	Fee and commission income		235		241
KBSP Private Equity Fund No.4	Fee and commission income		—		189
KB-NAU Special Situation Corporate Restructuring Private Equity Fund	Fee and commission income		711		397
2020 KB Fintech Renaissance Fund	Fee and commission income		73		73
KB Material and Parts No.1 PEF	Fee and commission income		527		175
FineKB Private Equity Fund No.1	Fee and commission income		240		316
	Gains on financial instruments at fair value through profit or loss		16		—
Paramark KB Fund No.1	Fee and commission income		32		211
KB-Badgers Future Mobility ESG Fund No.1	Fee and commission income		645		249
KB Bio Private Equity No.3 Ltd. *	Fee and commission income		—		99
KB-KTB Technology Venture Fund	Fee and commission income		413		325
THE CHAEUL FUND NO.1	Fee and commission income		—		13
KB-Solidus Global Healthcare Fund	Fee and commission income		158		189
SwatchOn Inc. *	Fee and commission income		—		5
	Interest expense		—		5

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.1 Details of significant profit or loss arising from transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)

(In millions of Korean won)


		2023		2022
Gomi corporation Inc.	Interest income		38		26
	Interest expense		—		2
	Fee and commission income		1		1
	Provision for credit losses		23		1
KB Cape No.1 Private Equity Fund	Fee and commission income		73		72
	Gains on financial instruments at fair value through profit or loss		—		314
	Losses on financial instruments at fair value through profit or loss		89		—
KB-GeneN Medical Venture Fund No.1	Fee and commission income		44		32
KB-BridgePole Venture Investment Fund	Fee and commission income		67		50
KB-Kyobo New Mobility Power Fund	Fee and commission income		39		29
KB Co-Investment Private Equity Fund No.1	Fee and commission income		383		101
KB-NP Green ESG New Technology Venture Capital Fund	Fee and commission income		584		—
KB-FT 1st Green Growth Invetment Fund	Fee and commission income		67		—
	Interest expense		1		—
KB-SUSUNG 1st Inverstment Fund	Fee and commission income		31		—
Others
Retirement pension	Fee and commission income		775		684
	Interest expense		17		8

*	Excluded from the Group’s related party as of June 30, 2023.

Meanwhile, the Group purchased installment financial assets, etc. from KG Capital Co., Ltd. amounting to 373,044 million and 319,047 million for the six-month periods ended June 30, 2023 and 2022, respectively.

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)		June 30, 2023		December 31, 2022
Associates and joint ventures
Balhae Infrastructure Company	Other assets		1,285		1,306
Korea Credit Bureau Co., Ltd.	Loans measured at amortized cost (gross amount)		36		38
	Deposits		1,747		27,889
	Provisions		1		2
	Insurance contract liabilities		3		1
Incheon Bridge Co., Ltd.	Financial assets at fair value through profit or loss		33,468		32,948
	Loans measured at amortized cost (gross amount)		87,860		95,211
	Allowances for credit losses		42		12
	Other assets		567		615
	Deposits		68,560		48,639
	Provisions		45		18
	Insurance contract liabilities		169		89
	Other liabilities		226		446
Jungdo Co., Ltd.	Deposits		4		4
Dae-A Leisure Co., Ltd.	Deposits		149		154
Aju Good Technology Venture Fund	Deposits		7,023		7,222
	Other liabilities		1		73
Star-Lord General Investors Private Real Estate Investment Company No.10	Loans measured at amortized cost (gross amount)		149,439		149,294
	Allowances for credit losses		1		1
	Property and equipment		8,033		9,915
	Other assets		8,670		8,591
	Insurance contract liabilities		112		46
	Other liabilities		11,532		14,227
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund	Deposits		462		1,526
	Other liabilities		—		1
WJ Private Equity Fund No.1	Other assets		2		2
	Deposits		220		221
KB Cape No.1 Private Equity Fund	Financial assets at fair value through profit or loss		1,861		2,017
RAND Bio Science Co., Ltd.	Deposits		8		3
	Loans measured at amortized cost (gross amount)		1		—
KG Capital Co., Ltd. *	Loans measured at amortized cost (gross amount)		—		40,040
	Allowances for credit losses		—		55
	Other assets		—		63
	Deposits		—		10
	Insurance contract liabilities		—		14
	Other liabilities		—		5

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)		June 30, 2023		December 31, 2022
Food Factory Co., Ltd.	Financial assets at fair value through profit or loss		721		696
	Loans measured at amortized cost (gross amount)		2,212		3,345
	Allowances for credit losses		2		4
	Other assets		6		4
	Deposits		907		664
	Insurance contract liabilities		3		8
	Other liabilities		—		1
POSCO-KB Shipbuilding Fund	Other assets		760		177
Paycoms Co., Ltd.	Financial assets at fair value through profit or loss		1,250		1,172
	Deposits		1		1
Big Dipper Co., Ltd.	Loans measured at amortized cost (gross amount)		12		18
	Deposits		16		19
KB-KDBC Pre-IPO New Technology Business Investment Fund	Deposits		56		317
Iwon Alloy Co., Ltd.	Deposits		—		1
	Insurance contract liabilities		—		1
Computerlife Co., Ltd.	Deposits		—		3
RMGP Bio-Pharma Investment Fund, L.P.	Financial assets at fair value through profit or loss		6,572		6,384
	Other liabilities		81		36
RMGP Bio-Pharma Investment, L.P.	Financial assets at fair value through profit or loss		20		17
Wyatt Corp.	Financial assets at fair value through profit or loss		6,000		6,000
	Deposits		1		1
	Insurance contract liabilities		15		75
Skydigital Inc.	Deposits		25		10
Banksalad Co., Ltd.	Financial assets at fair value through profit or loss		9,414		10,470
Spark Biopharma Inc.	Financial assets at fair value through profit or loss		7,450		7,450
	Loans measured at amortized cost (gross amount)		15		17
	Deposits		11,156		17,534
	Other liabilities		54		91
UPRISE, Inc.	Financial assets at fair value through profit or loss		5,676		5,248
	Deposits		—		27
Stratio, Inc.	Financial assets at fair value through profit or loss		1,000		1,000
Honest Fund, Inc.	Financial assets at fair value through profit or loss		3,999		3,999

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)		June 30, 2023		December 31, 2022
CellinCells Co., Ltd.	Financial assets at fair value through profit or loss		2,000		2,000
	Loans measured at amortized cost (gross amount)		3		7
	Deposits		33		37
Channel Corporation	Financial assets at fair value through profit or loss		16,093		18,099
	Deposits		—		3,000
	Other liabilities		—		21
KB No.21 Special Purpose Acquisition Company	Financial assets at fair value through profit or loss		3,136		2,959
	Deposits		2,239		2,263
	Other liabilities		59		29
KB No.22 Special Purpose Acquisition Company	Financial assets at fair value through profit or loss		2,186		1,972
	Deposits		1,877		1,948
KB No.23 Special Purpose Acquisition Company	Financial assets at fair value through profit or loss		3,218		2,971
	Deposits		2,112		2,205
	Other liabilities		54		22
KB No.24 Special Purpose Acquisition Company	Financial assets at fair value through profit or loss		7,475		6,975
	Deposits		9,967		9,983
	Other liabilities		1		1
KB No.25 Special Purpose Acquisition Company	Financial assets at fair value through profit or loss		2,030		—
	Deposits		1,599		—
	Other liabilities		12		—
KB No.26 Special Purpose Acquisition Company	Financial assets at fair value through profit or loss		995		—
	Deposits		1,974		—
	Other liabilities		7		—
COSES GT Co., Ltd.	Financial assets at fair value through profit or loss		—		4,930
	Loans measured at amortized cost (gross amount)		503		506
	Allowances for credit losses		5		4
	Other assets		2		2
	Deposits		198		1,213
CWhy Inc.	Insurance contract liabilities		1		—
Bomapp Inc. *	Deposits		—		1
MitoImmune Therapeutics	Financial assets at fair value through profit or loss		7,000		7,000
KB-Solidus Global Healthcare Fund	Other assets		158		350

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)		June 30, 2023		December 31, 2022
Bioprotect Ltd.	Financial assets at fair value through profit or loss		4,555		3,802
Gomi corporation Inc.	Financial assets at fair value through profit or loss		4,000		4,000
	Loans measured at amortized cost (gross amount)		2,212		2,234
	Allowances for credit losses		38		17
	Other assets		5		5
	Deposits		9		915
	Other liabilities		1		1
SO-MYUNG RECYCLING Co., Ltd.	Insurance contract liabilities		1		—
Go2joy Co., Ltd.	Financial assets at fair value through profit or loss		1,200		1,200
	Deposits		79		—
ClavisTherapeutics, Inc.	Financial assets at fair value through profit or loss		2,000		2,000
S&E Bio Co., Ltd.	Financial assets at fair value through profit or loss		4,000		4,000
	Loans measured at amortized cost (gross amount)		7		10
	Deposits		3,821		6,419
	Other liabilities		9		—
Bluepointpartners Inc.	Financial assets at fair value through profit or loss		2,203		2,133
4N Inc.	Financial assets at fair value through profit or loss		200		200
	Deposits		2		5
Xenohelix Co., Ltd	Financial assets at fair value through profit or loss		2,100		2,100
Contents First Inc.	Financial assets at fair value through profit or loss		7,277		7,277
	Loans measured at amortized cost (gross amount)		10,002		10,017
	Allowances for credit losses		5		1
	Other assets		1		2
	Deposits		1,203		5,010
	Other liabilities		7		21
KB-MDI Centauri Fund LP	Financial assets at fair value through profit or loss		16,724		17,471
	Other assets		215		470
2020 KB Fintech Renaissance Fund	Other assets		37		37
OKXE Inc.	Financial assets at fair value through profit or loss		800		800

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)		June 30, 2023		December 31, 2022
Mantisco Co., Ltd.	Loans measured at amortized cost (gross amount)		15		15
	Financial assets at fair value through profit or loss		3,000		3,000
	Deposits		93		623
Pin Therapeutics Inc.	Loans measured at amortized cost (gross amount)		34		13
	Financial assets at fair value through profit or loss		5,000		5,000
	Deposits		5,292		6,033
	Other liabilities		4		18
IMBiologics Corp.	Loans measured at amortized cost (gross amount)		8		4
	Financial assets at fair value through profit or loss		7,000		5,000
SuperNGine Co., Ltd.	Loans measured at amortized cost (gross amount)		600		6
	Deposits		139		17
	Allowances for credit losses		6		—
	Other assets		1		—
	Financial assets at fair value through profit or loss		1,996		1,996
Desilo Inc.	Financial assets at fair value through profit or loss		3,168		3,168
	Loans measured at amortized cost (gross amount)		300		300
	Allowances for credit losses		5		2
	Deposits		5		1
Turing Co., Ltd.	Financial assets at fair value through profit or loss		3,000		3,000
	Deposits		1,236		2,788
IGGYMOB Co., Ltd.	Financial assets at fair value through profit or loss		5,000		5,000
	Loans measured at amortized cost (gross amount)		15		15
	Deposits		629		254
Kukka Co., Ltd.	Financial assets at fair value through profit or loss		2,490		2,490
	Deposits		5		—
ZIPDOC Inc.	Financial assets at fair value through profit or loss		2,000		2,000
	Deposits		350		915
TeamSparta Inc.	Financial assets at fair value through profit or loss		4,001		4,001
	Deposits		9,819		12,502
	Provisions		1		—
	Other liabilities		37		6

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June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)		June 30, 2023		December 31, 2022
Chabot Mobility Co., Ltd.	Financial assets at fair value through profit or loss		2,000		2,000
	Deposits		58		86
	Insurance contract liabilities		1		—
Wemade Connect Co., Ltd.	Financial assets at fair value through profit or loss		12,261		12,000
	Loans measured at amortized cost (gross amount)		46		52
	Allowances for credit losses		8		—
	Provisions		10		2
	Deposits		9,575		10,370
	Insurance contract liabilities		1		2
	Other liabilities		24		28
Nextrade Co., Ltd.	Deposits		56,205		56,202
	Other liabilities		1,707		263
TMAP Mobility Co., Ltd.	Loans measured at amortized cost (gross amount)		99		—
	Deposits		80,000		30,000
	Other liabilities		230		76
Taeyoungjungkong Co.,Ltd.	Loans measured at amortized cost (gross amount)		48		—
FutureConnect Co., Ltd.	Financial assets at fair value through profit or loss		1,499		1,499
Gushcloud Talent Agency	Financial assets at fair value through profit or loss		4,314		4,165
Grinergy	Loans measured at amortized cost (gross amount)		1		—
	Financial assets at fair value through profit or loss		4,178		2,500
	Provisions		1		—
NexThera Co., Ltd.	Financial assets at fair value through profit or loss		2,000		2,000
FineKB Private Equity Fund No.1	Other assets		124		160
Paramark KB Fund No.1	Other liabilities		67		34
December & Company Inc.	Deposits		1		1
	Insurance contract liabilities		103		9
KB Social Impact Investment Fund	Other assets		128		436
Checkmate Therapeutics Inc.	Financial assets at fair value through profit or loss		3,200		3,200
	Insurance contract liabilities		—		3
G1 Playground Co., Ltd.	Financial assets at fair value through profit or loss		1,000		1,000
	Deposits		15		—
Hibiscus Fund LP	Financial assets at fair value through profit or loss		8,506		10,221
	Other liabilities		2		257

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)		June 30, 2023		December 31, 2022
RMG-KB BioAccess Fund L.P.	Financial assets at fair value through profit or loss		2,130		2,753
	Other assets		81		—
RMG-KB BP Management Ltd.	Financial assets at fair value through profit or loss		93		77
KB Co-Investment Private Equity Fund No.1	Other assets		196		191
Spoon Radio Inc.	Financial assets at fair value through profit or loss		20,413		—
Neuroptika Inc.	Financial assets at fair value through profit or loss		5,879		—
Bitgoeul Cheomdan Green 1st Co., Ltd.	Deposits		949		—
Glenwood Credit Private Equity Fund No.2	Deposits		662		—
KBFT Green Growth No.1 New Technology Business Investment Association	Deposits		700		—
	Other liabilities		1		—
Key management personnel
Key management personnel	Loans measured at amortized cost (gross amount)		6,512		6,299
	Allowances for credit losses		4		3
	Other assets		6		7
	Deposits		17,627		17,618
	Provisions		3		1
	Insurance contract liabilities		3,003		2,374
	Other liabilities		467		387
Others
Retirement pension	Other assets		780		778
	Other liabilities		11		10,141

*	Excluded from the Group’s related party as of June 30, 2023, therefore, the remaining outstanding balances with those entities are not disclosed.

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.3 Details of significant lending transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Beginning		Loan		Collection			Ending
Associates and joint ventures
Korea Credit Bureau Co., Ltd.		38		36		(38	)		36
Incheon Bridge Co., Ltd.		128,159		530		(7,361	)		121,328
Star-Lord General Investors Private Real Estate Investment Company No.10		149,294		145		—			149,439
KB Cape No.1 Private Equity Fund		2,017		—		(156	)		1,861
RAND Bio Science Co., Ltd.		—		1		—			1
KG Capital Co., Ltd. *		40,040		—		(40,040	)		—
Food Factory Co., Ltd.		4,041		434		(1,542	)		2,933
Paycoms Co., Ltd.		1,172		78		—			1,250
Big Dipper Co., Ltd.		18		12		(18	)		12
RMGP Bio-Pharma Investment Fund, L.P.		6,384		188		—			6,572
RMGP Bio-Pharma Investment, L.P.		17		3		—			20
Wyatt Corp.		6,000		—		—			6,000
Banksalad Co., Ltd.		10,470		—		(1,056	)		9,414
UPRISE, Inc.		5,248		428		—			5,676
Stratio, Inc.		1,000		—		—			1,000
Honest Fund, Inc.		3,999		—		—			3,999
CellinCells Co., Ltd.		2,007		3		(7	)		2,003
KB No.21 Special Purpose Acquisition Company		2,959		177		—			3,136
KB No.22 Special Purpose Acquisition Company		1,972		214		—			2,186
KB No.23 Special Purpose Acquisition Company		2,971		247		—			3,218
KB No.24 Special Purpose Acquisition Company		6,975		500		—			7,475
KB No.25 Special Purpose Acquisition Company		—		2,030		—			2,030
KB No.26 Special Purpose Acquisition Company		—		995		—			995
COSES GT Co., Ltd.		5,436		3		(4,936	)		503
Channel Corporation		18,099		—		(2,006	)		16,093
MitoImmune Therapeutics		7,000		—		—			7,000
Bioprotect Ltd.		3,802		753		—			4,555
Gomi corporation Inc.		6,234		12		(34	)		6,212
Go2joy Co., Ltd.		1,200		—		—			1,200
ClavisTherapeutics, Inc.		2,000		—		—			2,000
S&E Bio Co., Ltd.		4,010		7		(10	)		4,007
Bluepointpartners Inc.		2,133		70		—			2,203
4N Inc.		200		—		—			200
Xenohelix Co., Ltd.		2,100		—		—			2,100
Contents First Inc.		17,294		—		(15	)		17,279
KB-MDI Centauri Fund LP		17,471		—		(747	)		16,724
OKXE Inc.		800		—		—			800

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.3 Details of significant lending transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2023
	Beginning		Loan		Collection			Ending
Checkmate Therapeutics Inc.		3,200		—		—			3,200
Mantisco Co., Ltd.		3,015		15		(15	)		3,015
IMBiologics Corp.		5,004		2,008		(4	)		7,008
Spark Biopharma Inc.		7,467		15		(17	)		7,465
G1 Playground Co., Ltd.		1,000		—		—			1,000
Pin Therapeutics Inc.		5,013		34		(13	)		5,034
Hibiscus Fund LP		10,221		—		(1,715	)		8,506
SuperNGine Co., Ltd.		2,002		600		(6	)		2,596
Desilo Inc.		3,468		—		—			3,468
RMG-KB BioAccess Fund L.P.		2,753		—		(623	)		2,130
RMG-KB BP Management Ltd.		77		16		—			93
IGGYMOB Co., Ltd.		5,015		15		(15	)		5,015
Turing Co., Ltd.		3,000		—		—			3,000
Kukka Co., Ltd.		2,490		—		—			2,490
ZIPDOC Inc.		2,000		—		—			2,000
Gushcloud Talent Agency		4,165		149		—			4,314
Grinergy		2,500		1,679		—			4,179
NexThera Co., Ltd.		2,000		—		—			2,000
Chabot Mobility Co., Ltd.		2,000		—		—			2,000
TeamSparta Inc.		4,001		—		—			4,001
FutureConnect Co., Ltd.		1,499		—		—			1,499
Wemade Connect Co., Ltd.		12,052		307		(52	)		12,307
TMAP Mobility Co., Ltd		—		99		—			99
Taeyoungjungkong Co., Ltd.		—		55		(7	)		48
Spoon Radio Co., Ltd		—		20,413		—			20,413
Neuroptika Inc.		—		5,879		—			5,879
Key management personnel		6,299		1,930		(1,717	)		6,512

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.3 Details of significant lending transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2023
	Beginning		Loan		Collection			Ending
Associates and joint ventures
Korea Credit Bureau Co., Ltd.		36		119		(36	)		119
Incheon Bridge Co., Ltd.		151,489		13		(11,746	)		139,756
Star-Lord General Investors Private Real Estate Investment Company No.10		—		150,000		(851	)		149,149
KB Star Office Private Real Estate Master Fund No.1 *		10,000		—		—			10,000
KB Cape No.1 Private Equity Fund		1,591		314		—			1,905
RAND Bio Science Co., Ltd.		1		1		(1	)		1
KG Capital Co., Ltd. *		40,074		28		(74	)		40,028
Food Factory Co., Ltd.		4,216		1,527		(1,552	)		4,191
Paycoms Co., Ltd.		1,269		64		—			1,333
Big Dipper Co., Ltd.		17		13		(17	)		13
RMGP Bio-Pharma Investment Fund, L.P.		5,423		839		—			6,262
RMGP Bio-Pharma Investment, L.P.		14		4		—			18
Wyatt Corp.		6,000		—		—			6,000
Banksalad Co., Ltd.		9,090		845		—			9,935
UPRISE, Inc.		1,250		3,998		—			5,248
Stratio, Inc.		1,000		—		—			1,000
Honest Fund, Inc.		3,999		—		—			3,999
CellinCells Co., Ltd.		2,006		13		(6	)		2,013
KB No.17 Special Purpose Acquisition Company *		1,301		—		(1,301	)		—
KB No.18 Special Purpose Acquisition Company *		3,881		—		(3,881	)		—
KB No.19 Special Purpose Acquisition Company *		2,091		—		(1,092	)		999
KB No.20 Special Purpose Acquisition Company *		3,135		298		—			3,433
KB No.21 Special Purpose Acquisition Company		—		3,144		—			3,144
KB No.22 Special Purpose Acquisition Company		—		990		—			990
COSES GT Co., Ltd.		5,445		8		(15	)		5,438
Bomapp Inc. *		19		—		(19	)		—
Channel Corporation		14,551		—		—			14,551
MitoImmune Therapeutics		7,000		—		—			7,000
Bioprotect Ltd.		3,557		322		—			3,879
Gomi corporation Inc.		4,733		1,536		(33	)		6,236
Copin Communications, Inc. *		4,801		—		(4,801	)		—

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.3 Details of significant lending transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2023
	Beginning		Loan		Collection			Ending
Go2joy Co., Ltd.		1,200		—		—			1,200
ClavisTherapeutics, Inc.		2,000		—		—			2,000
S&E Bio Co., Ltd.		2,000		—		—			2,000
Bluepointpartners Inc.		2,278		—		(118	)		2,160
4N Inc.		200		—		—			200
Xenohelix Co., Ltd.		2,100		—		—			2,100
Contents First Inc.		7,277		—		—			7,277
KB-MDI Centauri Fund LP		9,633		7,796		—			17,429
SwatchOn Inc. *		3,418		68		(3,418	)		68
OKXE Inc.		800		—		—			800
GENINUS Inc.		5,872		28		(339	)		5,561
Checkmate Therapeutics Inc.		2,200		—		—			2,200
Mantisco Co., Ltd.		3,001		7		(1	)		3,007
IMBiologics Corp.		5,004		4		(4	)		5,004
Spark Biopharma Inc.		4,967		2,527		(17	)		7,477
G1 Playground Co., Ltd.		1,000		—		—			1,000
Pin Therapeutics Inc.		3,000		2,008		—			5,008
Hibiscus Fund LP		4,731		5,806		—			10,537
SuperNGine Co., Ltd.		1,998		4		(2	)		2,000
Desilo Inc.		3,469		—		(1	)		3,468
RMG-KB BioAccess Fund L.P.		353		640		—			993
RMG-KB BP Management Ltd.		7		17		—			24
IGGYMOB Co., Ltd		5,006		15		(6	)		5,015
Turing Co., Ltd.		3,000		—		—			3,000
Kukka Co., Ltd.		—		2,490		—			2,490
ZIPDOC Inc.		—		2,000		—			2,000
Gushcloud Talent Agency		—		4,249		—			4,249
Grinergy		—		2,501		—			2,501
NexThera Co., Ltd.		—		2,000		—			2,000
Chabot Mobility Co., Ltd.		—		2,000		—			2,000
TeamSparta Inc.		—		4,001		—			4,001
FutureConnect Co., Ltd.		—		1,499		—			1,499
Wemade Connect Co., Ltd.		—		12,000		—			12,000
Key management personnel		4,591		2,804		(1,708	)		5,687

*	Excluded from the Group’s related party as of June 30, 2023.

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.4 Details of significant borrowing transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Beginning		Borrowing		Repayment			Others 1			Ending
Associates and joint ventures
Korea Credit Bureau Co., Ltd.		27,889		—		—			(26,142	)		1,747
Incheon Bridge Co., Ltd.		48,639		25,100		(28,000	)		22,821			68,560
Jungdo Co., Ltd.		4		—		—			—			4
Dae-A Leisure Co., Ltd.		154		—		—			(5	)		149
Iwon Alloy Co., Ltd.		1		—		—			(1	)		—
Computerlife Co., Ltd.		3		—		—			(3	)		—
Skydigital Inc.		10		—		—			15			25
Aju Good Technology Venture Fund		7,222		1,323		(7,900	)		6,378			7,023
KB-KDBC Pre-IPO New Technology Business Investment Fund		317		—		—			(261	)		56
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		1,526		—		—			(1,064	)		462
WJ Private Equity Fund No.1		221		—		—			(1	)		220
KG Capital Co., Ltd. 2		10		—		—			(10	)		—
KB No.21 Special Purpose Acquisition Company		2,263		—		—			(24	)		2,239
KB No.22 Special Purpose Acquisition Company		1,948		—		—			(71	)		1,877
KB No.23 Special Purpose Acquisition Company		2,205		—		(100	)		7			2,112
KB No.24 Special Purpose Acquisition Company		9,983		—		—			(16	)		9,967
KB No.25 Special Purpose Acquisition Company		—		1,500		—			99			1,599
KB No.26 Special Purpose Acquisition Company		—		1,670		—			304			1,974
RAND Bio Science Co., Ltd.		3		—		—			5			8
Food Factory Co., Ltd.		664		—		—			243			907
Paycoms Co., Ltd.		1		—		—			—			1
Big Dipper Co., Ltd.		19		—		—			(3	)		16
Wyatt Corp.		1		—		—			—			1
UPRISE, Inc.		27		—		—			(27	)		—
CellinCells Co., Ltd.		37		—		—			(4	)		33

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.4 Details of significant borrowing transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2023
	Beginning		Borrowing		Repayment			Others 1			Ending
COSES GT Co., Ltd.		1,213		—		—			(1,015	)		198
Gomi corporation Inc.		915		—		—			(906	)		9
S&E Bio Co., Ltd.		6,419		2,500		—			(5,098	)		3,821
4N Inc.		5		—		—			(3	)		2
Contents First Inc.		5,010		5,000		(8,000	)		(807	)		1,203
December & Company Inc.		1		—		—			—			1
Mantisco Co., Ltd.		623		—		—			(530	)		93
Pin Therapeutics Inc.		6,033		7,217		(9,801	)		1,843			5,292
Spark Biopharma Inc.		17,534		9,612		(16,675	)		685			11,156
G1 Playground Co., Ltd.		—		—		—			15			15
SuperNGine Co., Ltd.		17		—		—			122			139
Desilo Inc.		1		1		—			3			5
Turing Co., Ltd.		2,788		—		—			(1,552	)		1,236
IGGYMOB Co., Ltd.		254		—		—			375			629
TMAP Mobility Co., Ltd.		30,000		30,000		(30,000	)		50,000			80,000
Nextrade Co., Ltd.		56,202		—		—			3			56,205
Kukka Co., Ltd.		—		—		—			5			5
ZIPDOC Inc.		915		—		—			(565	)		350
TeamSparta Inc.		12,502		5,000		(5,000	)		(2,683	)		9,819
Chabot Mobility Co., Ltd.		86		—		—			(28	)		58
Wemade Connect Co., Ltd.		10,370		18,000		(17,217	)		(1,578	)		9,575
Channel Corporation		3,000		3,000		(6,000	)		—			—
Go2joy Co., Ltd.		—		—		—			79			79
Bitgoeul Cheomdan Green 1st Co., Ltd.		—		—		—			949			949
Glenwood Credit Private Equity Fund No.2		—		—		—			662			662
KBFT Green Growth No.1 New Technology Business Investment Association		—		700		—			—			700
Key management personnel		17,619		11,366		(9,581	)		(1,776	)		17,628

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.4 Details of significant borrowing transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2022
	Beginning		Borrowing		Repayment			Others 1			Ending
Associates and joint ventures
Korea Credit Bureau Co., Ltd.		10,200		—		—			(8,723	)		1,477
Incheon Bridge Co., Ltd.		35,487		28,000		(15,000	)		7,180			55,667
Jungdo Co., Ltd.		4		—		—			—			4
Dae-A Leisure Co., Ltd.		17		—		—			140			157
Computerlife Co., Ltd.		—		—		—			1			1
Skydigital Inc.		85		—		—			(83	)		2
Jo Yang Industrial Co., Ltd.		1		—		—			—			1
Aju Good Technology Venture Fund		6,286		3,059		(2,440	)		(1,192	)		5,713
KB-KDBC Pre-IPO New Technology Business Investment Fund		904		—		—			(402	)		502
KB-Brain KOSDAQ Scale-up New Technology Business Investment Fund		1,524		—		—			251			1,775
WJ Private Equity Fund No.1		260		—		—			—			260
KB Star Office Private Real Estate Master Fund No.1 2		2,578		—		—			(193	)		2,385
KG Capital Co., Ltd. 2		17		—		—			(12	)		5
KB No.17 Special Purpose Acquisition Company 2		1,687		—		(1,546	)		(141	)		—
KB No.18 Special Purpose Acquisition Company 2		2,077		—		(2,016	)		(61	)		—
KB No.19 Special Purpose Acquisition Company 2		1,013		—		(30	)		(1	)		982
KB No.20 Special Purpose Acquisition Company 2		1,681		—		—			(7	)		1,674
KB No.21 Special Purpose Acquisition Company		—		—		—			2,289			2,289
KB No.22 Special Purpose Acquisition Company		—		—		—			2,196			2,196
RAND Bio Science Co., Ltd.		443		—		—			(406	)		37
Food Factory Co., Ltd.		839		511		(507	)		440			1,283
Acts Co., Ltd. 2		154		—		—			(110	)		44
Paycoms Co., Ltd.		1		—		—			—			1
Big Dipper Co., Ltd.		—		—		—			8			8
Wyatt Corp.		1		—		—			—			1

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.4 Details of significant borrowing transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2022
	Beginning		Borrowing		Repayment			Others 1			Ending
UPRISE, Inc.		4,001		—		—			—			4,001
CellinCells Co., Ltd.		38		—		—			123			161
COSES GT Co., Ltd.		1,939		—		—			(611	)		1,328
SwatchOn Inc. 2		686		—		—			(686	)		—
Gomi corporation Inc.		3,188		—		—			(1,356	)		1,832
S&E Bio Co., Ltd.		263		50		—			(262	)		51
KB Pre IPO Secondary Venture Fund No.1 2		103		—		—			(103	)		—
4N Inc.		39		—		—			(33	)		6
Contents First Inc.		12,650		—		(10,000	)		(2,352	)		298
December & Company Inc.		1		—		—			—			1
GENINUS Inc. 2		34,415		—		—			(14,485	)		19,930
Mantisco Co., Ltd.		386		—		—			(245	)		141
Pin Therapeutics Inc.		—		15,000		(2,000	)		390			13,390
Spark Biopharma Inc.		6,015		24,539		(12,500	)		(3,412	)		14,642
G1 Playground Co., Ltd.		354		—		—			(289	)		65
SuperNGine Co., Ltd.		944		—		—			(585	)		359
Desilo Inc.		168		—		—			(168	)		—
Turing Co., Ltd.		1,054		—		—			(437	)		617
IGGYMOB Co., Ltd.		2,938		—		—			(2,525	)		413
Kukka Co., Ltd.		—		—		—			7			7
ZIPDOC Inc.		—		—		—			2,159			2,159
TeamSparta Inc.		—		—		—			13,799			13,799
Chabot Mobility Co., Ltd.		—		—		—			62			62
Wemade Connect Co.,Ltd.		—		1,294		—			8,217			9,511
Key management personnel		16,996		9,529		(8,090	)		1,889			20,324

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 June 30, 2023.

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.5 Details of significant investment and withdrawal transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023				2022
	Equity investment and others		Withdrawal and others		Equity investment and others		Withdrawal and others
Balhae Infrastructure Company		—		5,820		—		14,231
KoFC POSCO Hanwha KB Shared Growth Private Equity Fund No.2 *		—		—		—		5
KB Pre IPO Secondary Venture Fund No.1 *		—		—		—		2,625
KB-KDBC Pre-IPO New Technology Business Investment Fund		—		—		—		1,400
KB-SJ Tourism Venture Fund		—		—		—		400
Korea Credit Bureau Co., Ltd.		—		90		—		—
KB-UTC Inno-Tech Venture Fund		—		1,800		—		—
KB-Solidus Global Healthcare Fund		—		—		—		19,630
KB Star Office Private Real Estate Master Fund No.1 *		—		—		—		681
KB SPROTT Renewable Private Equity Fund No.1		—		476		12,247		—
KB-NAU Special Situation Corporate Restructuring Private Equity Fund		—		1,515		—		3,628
KB Bio Private Equity No.3 Ltd. *		—		—		—		7,808
December & Company Inc.		—		19,171		—		—
KB-TS Technology Venture Private Equity Fund		—		672		—		1,400
KB Brain KOSDAQ Scaleup New Technology Business Investment Fund		—		2,400		—		1,200
Aju Good Technology Venture Fund		—		7,800		—		1,200
G payment Joint Stock Company		344		—		—		262
498/7 Owners LLC *		—		—		—		166,851
KB-KTB Technology Venture Fund		—		—		5,600		—
KB-SOLIDUS Healthcare Investment Fund		—		—		9,000		—
Paramark KB Fund No.1		1,590		—		4,050		—
FineKB Private Equity Fund No.1		—		2,125		7,500		3,100
KB-GeneN Medical Venture Fund No.1		—		—		2,000		—
KB-BridgePole Venture Investment Fund		—		—		850		—
KB-Kyobo New Mobility Power Fund		—		—		3,000		—
JS Private Equity Fund No.3		—		—		1,700		—
Mirae Asset Mobility Investment Fund No.1		—		—		2,000		—
KB-FT 1st Green Growth Investment Fund 1		—		—		2,000		—
THE CHAEUL FUND NO.1		—		—		1,000		—
Star-Lord General Investors Private Real Estate Investment Company No.10		—		—		46,700		—
KB Co-Investment Private Equity Fund No.1		1,920		—		7,268		—
Glenwood Credit Private Equity Fund No.2		—		—		42,000		—
Apollo REIT PropCo LLC *		—		—		19,968		19,968
PEBBLES-MW M.C.E New Technology Investment Fund 1st		—		329		—		—
KB-NP Green ESG New Technology Venture Capital Fund		4,350		—		—		—
KB-Badgers Future Mobility ESG Fund No.1		2,754		—		—		—
Lakewood-AVES Fund No.1		2,000		—		—		—

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.5 Details of significant investment and withdrawal transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)	2023				2022
	Equity investment and others		Withdrawal and others		Equity investment and others		Withdrawal and others
MW-Pyco NewWave New Technology Investment Fund 4th		2,000		—		—		—
KB No.25 Special Purpose Acquisition Company		5		—		—		—
KB No.26 Special Purpose Acquisition Company		5		—		—		—
Bitgoeul Cheomdan Green 1st Co., Ltd.		2,000		—		—		—
KB-SUSUNG 1st Inverstment Fund		1,200		—		—		—
Friend 55 New Technology Business Investment Fund		190		—		—		—
Hahn & Company No. 4-3 Private Equity Fund		5,557		—		—		—

*	Excluded from the Group’s related party as of June 30, 2023.

34.6 Unused commitments provided to related parties as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won or in a US Dollar or Malaysian ringgit)		June 30, 2023		December 31, 2022
Associates and joint ventures
Balhae Infrastructure Company	Purchase of securities		6,154		6,154
Korea Credit Bureau Co., Ltd.	Unused lines of credit for credit card		564		562
Incheon Bridge Co., Ltd	Loan commitments in Korean won		20,000		20,000
	Unused lines of credit for credit card		90		89
TeamSparta Inc.	Loan commitments in Korean won		1,000		—
KG Capital Co., Ltd. *	Unused lines of credit for credit card		125		110
Food Factory Co., Ltd.	Unused lines of credit for credit card		50		52
KB No.23 Special Purpose Acquisition Company	Unused lines of credit for credit card		12		12
CellinCells Co., Ltd.	Unused lines of credit for credit card		21		17
RAND Bio Science Co., Ltd.	Unused lines of credit for credit card		24		25
Big Dipper Co., Ltd.	Unused lines of credit for credit card		33		27
Gomi corporation Inc.	Unused lines of credit for credit card		38		16
COSES GT Co., Ltd.	Unused lines of credit for credit card		27		24
Spark Biopharma Inc.	Unused lines of credit for credit card		35		33
Mantisco Co., Ltd.	Unused lines of credit for credit card		15		15
IMBiologics Corp.	Unused lines of credit for credit card		15		18
SuperNGine Co., Ltd.	Unused lines of credit for credit card		40		14
IGGYMOB Co., Ltd.	Unused lines of credit for credit card		35		35
Pin Therapeutics Inc.	Unused lines of credit for credit card		16		37
Grinergy	Unused lines of credit for credit card		9		10
S&E Bio Co., Ltd.	Unused lines of credit for credit card		43		40

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.6 Unused commitments provided to related parties as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won or in a US Dollar or Malaysian ringgit)		June 30, 2023		December 31, 2022
Wemade Connect Co., Ltd.	Unused lines of credit for credit card		154		148
TMAP Mobility Co., Ltd.	Unused lines of credit for credit card		717		—
Contents First Inc.	Unused lines of credit for credit card		50		—
KB-TS Technology Venture Private Equity Fund	Purchase of securities		110		110
KB SPROTT Renewable Private Equity Fund No.1	Purchase of securities		5,140		5,140
KB-Stonebridge Secondary Private Equity Fund	Purchase of securities		864		864
KB-NAU Special Situation Corporate Restructuring Private Equity Fund	Purchase of securities		15,288		15,288
All Together Korea Fund No.2	Purchase of securities		990,000		990,000
KB-KTB Technology Venture Fund	Purchase of securities		12,614		11,200
KB-SOLIDUS Healthcare Investment Fund	Purchase of securities		70,200		70,200
KB Co-Investment Private Equity Fund No.1	Purchase of securities		13,524		15,732
KB-Badgers Future Mobility ESG Fund No.1	Purchase of securities		40,109		42,863
KB-NP Green ESG New Technology Venture Capital Fund	Purchase of securities		36,300		40,650
FineKB Private Equity Fund No.1	Purchase of securities		9,125		9,125
KB-Solidus Global Healthcare Fund	Purchase of securities		2,120		2,120
	Commitments on loss absorption priority		4,500		4,500
Paramark KB Fund No.1	Purchase of securities		13,534		17,832
Smart Korea KB Future9-Sejong Venture Fund	Purchase of securities		2,000		3,000
Hahn & Company No. 4-3 Private Equity Fund	Purchase of securities		46,527		—
RMGP Bio-Pharma Investment Fund, L.P.	Purchase of securities	USD	3,868,166	USD	4,094,487
RMGP Bio-Pharma Investment, L.P.	Purchase of securities	USD	10,424	USD	10,731
KB-MDI Centauri Fund LP	Purchase of securities	USD	1,447,518	USD	1,744,518
Hibiscus Fund LP	Purchase of securities	MYR	16,666,667	MYR	16,666,667
RMG-KB BP Management Ltd.	Purchase of securities	USD	694,196	USD	699,733
RMG-KB BioAccess Fund L.P.	Purchase of securities	USD	27,211,854	USD	27,428,899
Key management personnel	Loan commitments in Korean won		2,991		2,354

*	Excluded from the Group’s related party as of June 30, 2023.

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

34.7 Details of compensation to key management personnel for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Short-term employee benefits		Post- employment benefits		Share- based payments		Total
Registered directors (executive)		4,151		512		2,753		7,416
Registered directors (non-executive)		536		—		—		536
Non-registered directors		8,840		347		5,636		14,823

		13,527		859		8,389		22,775


(In millions of Korean won)	2022
	Short-term employee benefits		Post- employment benefits		Share- based payments		Total
Registered directors (executive)		4,373		457		2,074		6,904
Registered directors (non-executive)		542		—		—		542
Non-registered directors		7,844		258		4,545		12,647

		12,759		715		6,619		20,093

34.8 Details of collateral provided by related parties as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	Assets held as collateral	June 30, 2023		December 31, 2022
Key management personnel	Time deposits and others		797		457
	Real estate		8,839		7,483

As of June 30, 2023, 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 611,000 million to the project financing group consisting of the Group and 5 other institutions, and as subordinated collateral amounting to 384,800 million to subordinated debt holders consisting of the Group and 2 other institutions. Also, it provides certificate of credit guarantee amounting to 400,000 million as collateral to the project financing group consisting of the Group and 5 other institutions.

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Notes to the Consolidated Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

35. Events after the reporting period

According to the resolution of the Board of Directors on July 25, 2023, the interim dividends per share of 510 (total dividends: 195,966 million) with dividend record date of June 30, 2023 were paid on August 8, 2023. The Group’s consolidated financial statements as of June 30, 2023, do not reflect this dividends payable.

In accordance with the resolution of the Board of Directors on July 25, 2023, the Parent Company plans to acquire and retire 6,295,907 shares ( 300,000 million) of treasury stocks on the market by July 31, 2024. However, the above number of stocks were computed based on the closing price ( 47,650) as of July 24, 2023, the day before the Board of Directors meeting; as such, the final number of treasury stocks to be retired may change according to stock price.

174

EX-99.2 3 d492931dex992.htm EX-99.2 EX-99.2

Exhibit 99.2

KB Financial Group Inc.

Separate Interim Financial Statements

June 30, 2023 and 2022

(Unaudited)

KB Financial Group Inc.


	Page(s)
Report on Review of Condensed Separate Interim Financial Statements		1-2

Separate Interim Financial Statements

Separate Interim Statements of Financial Position		3

Separate Interim Statements of Comprehensive Income		4

Separate Interim Statements of Changes in Equity		5

Separate Interim Statements of Cash Flows		6

Notes to the Separate Interim Financial Statements		7

Report on Review of Condensed Separate Interim Financial Statements

(English Translation of a Report Originally Issued in Korean)

To the Shareholders and the Board of Directors of

KB Financial Group Inc.

Reviewed Financial Statements

We have reviewed the accompanying condensed separate interim financial statements of KB Financial Group Inc. (the “Company”). These condensed separate interim financial statements consist of the separate interim statement of financial position of the Company as of June 30, 2023 and the related separate interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2023, changes in equity and cash flows for the six-month period ended June 30, 2023, and material accounting policies and other selected explanatory notes, expressed in Korean Won.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and presentation of these condensed separate interim financial statements in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (“Korean IFRS”) No.1034 Interim Financial Reporting, and for such internal control as management determines is necessary to enable the preparation of condensed separate interim financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to issue a report on these condensed separate interim financial statements based on our review.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe the accompanying condensed separate interim financial statements are not prepared, in all material respects, in accordance with Korean IFRS 1034 Interim Financial Reporting.

Other Matters

The separate interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2022, changes in equity and cash flows for the six-month period ended on June 30, 2022, presented herein for comparative purposes, were reviewed by another auditor who expressed their review conclusion that nothing has come to their attention that causes them to believe the condensed separate interim financial statements do not present fairly, in all material respects, in accordance with Korean IFRS No. 1034 Interim Financial Reporting on August 16, 2022.

The separate statement of financial position as of December 31, 2022, and the separate statements of comprehensive income, changes in equity and cash flows for the year then ended, not presented herein, were audited by another auditor who expressed an unqualified opinion on those statements on March 7, 2023. The separate statement of financial position as of December 31, 2022, presented herein for comparative purposes, is consistent, in all material respects, with the above audited statement of financial position as of December 31, 2022.

/s/ Samil PricewaterhouseCoopers

Seoul, Korea

August 14, 2023

This report is effective as of August 14, 2023, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying condensed separate interim financial statements and notes thereto. Accordingly, the readers of the review report should understand that there is a possibility that the above review report may have to be revised to reflect the impact of such subsequent events or circumstances, if any.

KB Financial Group Inc.

Separate Interim Statements of Financial Position

June 30, 2023 and December 31, 2022

(In millions of Korean won)


	Notes		June 30, 2023 (Unaudited)			December 31, 2022
Assets
Cash and due from financial institutions		4,5,6,22		1,202,390			351,056
Financial assets at fair value through profit or loss		4,5,7		1,548,931			1,522,314
Loans measured at amortized cost		4,5,8		522,326			522,326
Investments in subsidiaries		9		26,717,817			26,741,438
Property and equipment				2,627			3,552
Intangible assets				15,505			16,752
Net defined benefit assets		12		3,532			4,288
Deferred income tax assets		10		11,574			19,904
Other assets		4,5		669,530			1,272,197

Total assets				30,694,232			30,453,827

Liabilities
Debentures		4,5,11		4,169,434			4,956,949
Current income tax liabilities				463,881			926,573
Other liabilities		4,5		195,516			338,489

Total liabilities				4,828,831			6,222,011

Equity		13
Share capital				2,090,558			2,090,558
Hybrid securities				5,032,518			4,433,981
Capital surplus				14,754,747			14,754,747
Accumulated other comprehensive loss				(5,822	)		(5,847	)
Retained earnings				4,859,237			3,794,565
Treasury shares				(865,837	)		(836,188	)

Total equity				25,865,401			24,231,816

Total liabilities and equity				30,694,232			30,453,827

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

KB Financial Group Inc.

Separate Interim Statements of Comprehensive Income

Three-Month and Six-Month Periods Ended June 30, 2023 and 2022

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


	Notes		2023 (Unaudited)						2022 (Unaudited)
			Three months			Six months			Three months			Six months
Interest income				11,479			18,149			4,369			7,485
Interest income from financial instruments at amortized cost				10,800			16,351			3,710			6,165
Interest income from financial instruments at fair value through profit or loss				679			1,798			659			1,320
Interest expense				(24,859	)		(51,583	)		(26,734	)		(54,592	)

Net interest expense		15		(13,380	)		(33,434	)		(22,365	)		(47,107	)

Fee and commission income				409			781			356			1,159
Fee and commission expense				(3,498	)		(5,117	)		(3,724	)		(5,294	)

Net fee and commission expense		16		(3,089	)		(4,336	)		(3,368	)		(4,135	)

Net gains (losses) on financial instruments at fair value through profit or loss		17		6,242			51,670			(16,435	)		(16,860	)

Net other operating income		18		—			2,192,380			—			1,671,224

General and administrative expenses		19		(22,979	)		(45,881	)		(18,925	)		(41,646	)

Operating income (loss) before provision for credit losses				(33,206	)		2,160,399			(61,093	)		1,561,476

Provision for credit losses				(7	)		(7	)		(5	)		(2	)

Net operating income (loss)				(33,213	)		2,160,392			(61,098	)		1,561,474

Net non-operating income (expenses)				4,393			4,406			(339	)		(435	)

Profit (loss) before income tax benefit				(28,820	)		2,164,798			(61,437	)		1,561,039

Income tax benefit		20		2,370			(8,321	)		7,315			8,644

Profit (loss) for the period				(26,450	)		2,156,477			(54,122	)		1,569,683

Items that will not be reclassified to profit or loss:
Remeasurements of net defined benefit liabilities				8			25			(169	)		(281	)

Other comprehensive loss for the period, net of tax				8			25			(169	)		(281	)

Total comprehensive income (loss) for the period				(26,442	)		2,156,502			(54,291	)		1,569,402

Earnings (loss) per share		21
Basic earnings (loss) per share				(194	)		5,354			(212	)		3,897
Diluted earnings (loss) per share				(188	)		5,234			(206	)		3,811

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

KB Financial Group Inc.

Separate Interim Statements of Changes in Equity

Six-Month Periods Ended June 30, 2023 and 2022

(In millions of Korean won)


	Share capital		Hybrid securities		Capital surplus		Accumulated other comprehensive income			Retained earnings			Treasury shares			Total equity
Balance as of January 1, 2022		2,090,558		2,837,981		14,754,747		(8,330	)		3,974,206			(1,136,188	)		22,512,974

Comprehensive income for the period
Profit for the period		—		—		—		—			1,569,683			—			1,569,683
Remeasurements of net defined benefit liabilities		—		—		—		(281	)		—			—			(281	)

Total comprehensive income for the period		—		—		—		(281	)		1,569,683			—			1,569,402

Transactions with shareholders
Annual dividends		—		—		—		—			(853,299	)		—			(853,299	)
Quarterly dividends		—		—		—		—			(194,817	)		—			(194,817	)
Retirement of treasury shares		—		—		—		—			(150,000	)		150,000			—
Issuance of hybrid securities		—		1,097,301		—		—			—			—			1,097,301
Dividends on hybrid securities		—		—		—		—			(51,183	)		—			(51,183	)

Total transactions with shareholders		—		1,097,301		—		—			(1,249,299	)		150,000			(1,998	)

Balance as of June 30, 2022 (Unaudited)		2,090,558		3,935,282		14,754,747		(8,611	)		4,294,590			(986,188	)		24,080,378

Balance as of January 1, 2023		2,090,558		4,433,981		14,754,747		(5,847	)		3,794,565			(836,188	)		24,231,816

Comprehensive income for the period
Profit for the period		—		—		—		—			2,156,478			—			2,156,478
Remeasurements of net defined benefit liabilities		—		—		—		25			—			—			25

Total comprehensive income for the period		—		—		—		25			2,156,478			—			2,156,503

Transactions with shareholders
Annual dividends		—		—		—		—			(564,970	)		—			(564,970	)
Quarterly dividends		—		—		—		—			(195,967	)		—			(195,967	)
Acquisition of treasury shares		—		—		—		—			—			(271,745	)		(271,745	)
Retirement of treasury shares		—		—		—		—			(242,096	)		242,096			—
Issuance of hybrid securities		—		598,537		—		—			—			—			598,537
Dividends on hybrid securities		—		—		—		—			(88,773	)		—			(88,773	)

Total transactions with shareholders		—		598,537		—		—			(1,091,806	)		(29,649	)		(522,918	)

Balance as of June 30, 2023 (Unaudited)		2,090,558		5,032,518		14,754,747		(5,822	)		4,859,237			(865,837	)		25,865,401

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

KB Financial Group Inc.

Separate Interim Statements of Cash Flows

Six-Month Periods Ended June 30, 2023 and 2022

(In millions of Korean won)


	Notes		2023 (Unaudited)			2022 (Unaudited)
Cash flows from operating activities
Profit for the period				2,156,477			1,569,683

Adjustment for non-cash items
Depreciation and amortization expense				2,717			2,838
Reversal of provision for credit losses				7			2
Share-based payments				2,886			1,689
Net interest expense				1,307			1,586
Valuation losses (gains) on financial assets at fair value through profit or loss				(25,814	)		31,754
Disposal gains of subsidiaries				(3,917	)		—
Other expenses				762			1,121

				(22,052	)		38,990

Changes in operating assets and liabilities
Due from financial institutions				30,000			(30,000	)
Deferred income tax assets				8,321			(8,644	)
Other assets				(6,037	)		16,011
Other liabilities				815			(14,969	)

				33,099			(37,602	)

Net cash inflow from operating activities				2,167,524			1,571,071

Cash flows from investing activities
Acquisition of financial assets at fair value through profit or loss				(300,000	)		(600,000	)
Disposal of financial assets at fair value through profit of loss				300,000			—
Disposal of subsidiaries				27,539			—
Acquisition of property and equipment				(101	)		(1,390	)
Acquisition of intangible assets				(140	)		(62	)
Disposal of intangible assets				34			20
Net decrease (increase) in guarantee deposits paid				(80	)		(2,325	)
Other investing activities				(349	)		(790	)

Net cash inflow (outflow) from investing activities				26,903			(604,547	)

Cash flows from financing activities
Decrease in borrowings				—			—
Increase in debentures				109			498,898
Decrease in debentures				(790,000	)		(730,000	)
Dividends paid to shareholders				(760,937	)		(1,048,116	)
Redemption of principal elements of lease payments				(284	)		(266	)
Acquisition of treasury shares				(271,745	)		—
Issuance of hybrid securities				598,537			1,097,301
Dividends paid on hybrid securities				(88,773	)		(51,183	)

Net cash inflow (outflow) from financing activities				(1,313,093	)		(233,366	)

Net increase in cash and cash equivalents				881,334			733,158
Cash and cash equivalents at the beginning of the period		22		231,053			518,073

Cash and cash equivalents at the end of the period		22		1,112,387			1,251,231

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

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

1. The Company

KB Financial Group Inc. (the “Company”), in accordance with Financial Holding Companies Act, was established on September 29, 2008, through stock transfers with the former shareholders of Kookmin Bank, KB Investment & Securities Co., Ltd., KB Asset Management Co., Ltd., KB Real Estate Trust Co., Ltd., KB Investment Co., Ltd., KB Futures Co., Ltd., KB Credit Information Co., Ltd., and KB Data Systems Co., Ltd., and the Company’s main business purpose is to control subsidiaries that engage in the financial business or subsidiaries closely related to the financial business through the stock ownership. The headquarter is located at 26, Gukjegeumyung-ro 8-gil, Yeongdeungpo-gu, Seoul. The Company’s share capital as of June 30, 2023, is 2,090,558 million. In 2011, Kookmin Bank spun off its credit card business segment and established a new separate credit card company, KB Kookmin Card Co., Ltd., and KB Investment & Securities Co., Ltd. merged with KB Futures Co., Ltd. The Company established KB Savings Bank Co., Ltd. in January 2012, acquired Yehansoul Savings Bank Co., Ltd. in September 2013, and KB Savings Bank Co., Ltd. merged with Yehansoul Savings Bank Co., Ltd. in January 2014. In March 2014, the Company acquired Woori Financial Co., Ltd. and changed the name to KB Capital Co., Ltd. Meanwhile, the Company included LIG Insurance Co., Ltd. as an associate and changed the name to KB Insurance Co., Ltd. in June 2015, and KB Insurance Co., Ltd. became one of the subsidiaries through a tender offer in May 2017. Also, the Company included Hyundai Securities Co., Ltd. as an associate in June 2016 and included as a subsidiary in October 2016 by comprehensive exchange of shares. Hyundai Securities Co., Ltd. merged with KB Investment & Securities Co., Ltd. in December 2016 and changed its name to KB Securities Co., Ltd. in January 2017. In August 2020, the Group acquired Prudential Life Insurance Company of Korea Ltd. which was classified as a subsidiary and the name was changed to KB Life Insurance Co., Ltd. in December 2022. Then in January 2023, it merged with another existing KB Life Insurance Co., Ltd. The Company sold 100% shares of KB Credit Information Co., Ltd. to KB Kookmin Card Co., Ltd. on June 30, 2023.

The Company has been listed on the Korea Exchange (“KRX”) since October 10, 2008, and on the New York Stock Exchange (“NYSE”) for its American Depositary Shares (“ADS”) since September 29, 2008. Number of shares authorized on its Articles of Incorporation is 1,000 million.

2. Basis of Preparation

2.1 Application of Korean IFRS

The Company 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 Company 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 separate financial statements requires the use of certain critical accounting estimates. Management also needs to exercise judgment in applying the Company’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.

The separate financial statements have been prepared in accordance with Korean IFRS No.1027 Separate Financial Statements.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1 Application of Korean IFRS (cont’d)

The Company’s condensed separate interim financial statements for the six-month period ended June 30, 2023, have been prepared in accordance with Korean IFRS No.1034 Interim Financial Reporting and contain less information than is required in annual separate financial statements. Selected explanatory notes include descriptions of transactions or events that are significant in understanding change in financial position and financial performance of the Company since the end of the previous annual reporting period. These condensed separate interim financial statements have been prepared in accordance with Korean IFRS which is effective or early adopted as of June 30, 2023.

2.1.1 The Company has applied the following new and amended standards for the first time for its annual reporting period commencing January 1, 2023.

•

Issuance of Korean IFRS No.1117 Insurance Contracts

Korean IFRS No.1117 Insurance Contracts replaced 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. These amendments do not have a significant impact on the financial statements.

•

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

•

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

•

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

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

2.1.2 The following amended standards have been published that are not mandatory for June 30, 2023 reporting period and have not been adopted by the Company.

•

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

2.1.3 The following are the accounting standards that have been established or announced but have not yet been implemented, which the Group has not applied

•

Amendment of K-IFRS No.1001 “Presentation of Financial Statements” - Classification of Liabilities into Current and Non-Current

2.2 Measurement Basis

The separate financial statements have been prepared under the historical cost convention unless otherwise specified.

2.3 Functional and Presentation Currency

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

2.4 Critical Accounting Estimates

The Company 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 used in the preparation of the financial statements are the same as 2022 financial statements, except for the method of estimating income tax expense.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

3. Material Accounting Policies

The material accounting policies and calculation methods applied in the preparation of these condensed separate interim financial statements are the same as those applied to the separate financial statements for the year ended December 31, 2022, except for the impact of changes due to adopting new and amended standards and interpretations described in Note 2.1 and below paragraph.

Income tax expense for the interim period is measured applying the expected average annual income tax rate applicable on expected total annual income.

4. Financial Risk Management

4.1 Summary

4.1.1 Overview of financial risk management policy

The financial risks that the Company 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 Company 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 Company’s risk management system focuses on efficiently supporting long-term strategy and management decisions of the Company by increasing risk transparency, preventing risk transfer between subsidiaries and preemptive response to rapidly changing financial environments. Credit risk, market risk, liquidity risk, operational risk, interest rate risk, insurance risk, credit concentration risk, strategy risk, and reputation risk are recognized as significant risks.

4.1.2 Risk management organization

4.1.2.1 Risk Management Committee

4.1.2.2 Risk Management Council

The Risk Management Council is responsible for consulting on matters delegated by the Risk Management Committee and requests for review by the Group Management Executive Committee, consulting on details of each subsidiary’s risk management policies and procedures, monitoring the Group’s risk management status, and establishing and implementing necessary measures.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.1.2.3 Risk Management Department

The Risk Management Department performs the Company’s risk management detailed policies, procedures, and business processes, and is responsible for calculating the Group’s risk-weighted assets, monitoring and managing internal capital limits.

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 purposes, the Company considers default risk of individual borrowers.

4.2.2 Credit risk management

The Company measures the expected losses of assets subject to credit risk management and uses them as a management indicator.

4.2.3 Maximum exposure to credit risk

The Company’s maximum exposures to credit risk without consideration of collateral values in relation to financial instruments other than equity securities as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Due from financial institutions		1,202,390		351,056
Loans measured at amortized cost *		522,326		522,326
Loans measured at fair value through profit or loss		45,751		343,525
Other financial assets *		58,216		44,841

		1,828,683		1,261,748

*	After netting of allowance

4.2.4 Credit risk of loans

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

The Company assesses expected credit losses and recognizes loss allowances of financial assets at amortized cost and financial asset at fair value through other comprehensive income. 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 Company measures the expected credit losses on 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.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.4 Credit risk of loans (cont’d)

Credit qualities of loans measured at amortized cost as of June 30, 2023 and December 31 2022, are classified as follows:

(In millions of Korean won)


	June 30, 2023
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Loans measured at amortized cost *
Corporate
Grade 1		523,500		—		—		—		523,500
Grade 2		—		—		—		—		—
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		523,500		—		—		—		523,500

(In millions of Korean won)


	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Loans measured at amortized cost *
Corporate
Grade 1		523,500		—		—		—		523,500
Grade 2		—		—		—		—		—
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		523,500		—		—		—		523,500

*	Before netting of allowance

Credit qualities of loans graded according to the probability of default as June 30, 2023 and December 31 2022, are as follows:


		Range of probability of default (%)
Grade 1		0.0 ~ 1.0
Grade 2		1.0 ~ 5.0
Grade 3		5.0 ~ 15.0
Grade 4		15.0 ~ 30.0
Grade 5		30.0 ~

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.5 Credit risk of due from financial institutions

Credit qualities of due from financial institutions as of June 30, 2023 and December 31 2022, are as follows:

(In millions of Korean won)


	June 30, 2023
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Due from financial institutions measured at amortized cost
Grade 1		1,202,390		—		—		—		1,202,390
Grade 2		—		—		—		—		—
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		1,202,390		—		—		—		1,202,390

(In millions of Korean won)


	December 31, 2022
	12-month expected credit losses		Lifetime expected credit losses				Not applying expected credit losses		Total
	12-month expected credit losses		Non-impaired		Impaired		Not applying expected credit losses		Total
Due from financial institutions measured at amortized cost
Grade 1		351,056		—		—		—		351,056
Grade 2		—		—		—		—		—
Grade 3		—		—		—		—		—
Grade 4		—		—		—		—		—
Grade 5		—		—		—		—		—

		351,056		—		—		—		351,056

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.2.6 Credit risk concentration analysis

4.2.6.1 Classifications of corporate loans by industry as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Corporate loans *		%		Allowances			Carrying amount
Financial institutions		569,251		100.00		(1,174	)		568,077

(In millions of Korean won)	December 31, 2022
	Corporate loans *		%		Allowances			Carrying amount
Financial institutions		867,025		100.00		(1,174	)		865,851

*	Amount includes loans measured at fair value through profit or loss and amortized cost.

4.2.6.2 Classifications of due from financial institutions by industry as of June 30, 2023 and December 31 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Amount		%		Allowances		Carrying amount
Due from financial institutions measured at amortized cost
Financial institutions		1,202,390		100.00		—		1,202,390

(In millions of Korean won)	December 31, 2022
	Amount		%		Allowances		Carrying amount
Due from financial institutions measured at amortized cost
Financial institutions		351,056		100.00		—		351,056

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

4.3 Liquidity Risk

4.3.1 Overview of liquidity risk

Liquidity risk is a risk that the Company 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 Company manages its liquidity risk through analysis of the contractual maturity of all financial assets and liabilities and discloses in six categories such as on demand, less than one month, between one month to three months, between three months to one year, between one year to five years, and over five years.

4.3.2. Liquidity risk management

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 for floating-rate liabilities are calculated on the assumption that the current interest rate is the same until maturity.

Remaining contractual maturity of financial liabilities as of June 30, 2023 and December 31 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	On Demand		Up to 1 month		1-3 months		3-12 months		1-5 years		Over 5 years		Total
Financial liabilities
Debentures		—		74,293		68,558		897,960		2,301,420		1,197,317		4,539,548
Lease liabilities		—		53		95		325		333		—		806
Other financial liabilities		—		10,553		—		11,640		—		—		22,193

		—		84,899		68,653		909,925		2,301,753		1,197,317		4,562,547


(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
Debentures		—		275,723		160,712		756,380		2,863,695		1,330,748		5,387,258
Lease liabilities		—		49		88		381		330		—		848
Other financial liabilities		—		1,620		—		—		—		—		1,620

		—		277,392		160,800		756,761		2,864,025		1,330,748		5,389,726

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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. The Company 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 Trading position

In accordance with Financial Holding Companies Act, the Company’s main business is to control financial companies or companies closely related to the financial service. And the Company cannot perform any other business other than managing activities as a holding company, therefore there is no risk of trading position.

4.4.3 Non-trading position

Non-trading position refers to the part except trading position, and the main risk the Company is managing is interest rate risk.

4.4.3.1 Definition of interest rate risk

Interest rate risk refers to the risk of changes in the value (fair value) of the items in the statement of financial position due to changes in interest rate and the risk of changes in cash flows related to interest income and interest expense arising from investment and financing activities.

4.4.3.2 Observation method and management indicator on interest rate risk

The main objective of interest rate risk management is to protect the value changes from interest rate fluctuations. In addition to the Interest Rate Risk in the Banking Book (“IRRBB”) standard methodology required for disclosure, the Company applies the IRRBB methodology to measure and manage interest rate risk in a historical-simulation VaR method including interest rate volatility during the past financial crisis (FY2008-FY2009).

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

5. Financial Assets and Financial Liabilities

5.1 Classification and Fair Value of Financial Instruments

5.1.1 Carrying amount and fair value of financial assets and liabilities by category as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Carrying amount		Fair value
Financial assets
Financial assets at fair value through profit or loss
Hybrid securities		992,124		992,124
Beneficiary certificates		511,056		511,056
Loans		45,751		45,751
Financial assets at amortized cost
Due from financial institutions		1,202,390		1,202,390
Loans		522,326		522,326
Other financial assets		58,216		58,216

		3,331,863		3,331,863

Financial liabilities
Financial liabilities at amortized cost
Debentures		4,169,434		3,918,534
Other financial liabilities		31,658		31,658

		4,201,092		3,950,192


(In millions of Korean won)	December 31, 2022
	Carrying amount		Fair value
Financial assets
Financial assets at fair value through profit or loss
Hybrid securities		874,171		874,171
Beneficiary certificates		304,618		304,618
Loans		343,525		343,525
Financial assets at amortized cost
Due from financial institutions		351,056		351,056
Loans		522,326		522,326
Other financial assets		44,841		44,841

		2,440,537		2,440,537

Financial liabilities
Financial liabilities at amortized cost
Debentures		4,956,949		4,576,973
Other financial liabilities		13,331		13,331

		4,970,280		4,590,304

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 Company 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 quoted price in an active market.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

5.1.1 Carrying amount and fair value of financial assets and liabilities by category as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)

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		Fair value of financial instruments that are quoted in an active market 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, Imputed Market Value Model, Free Cash Flow to Equity Model, Dividend Discount Model, Risk Adjusted Discount Rate Method, and Net Asset Value Method.

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 Company 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 the Finite Difference Method (“FDM”), and the MonteCarlo Simulation or valuation results from independent external professional valuation institution.

Loans measured at amortized cost		Fair value of loans 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		DCF model is used to determine the fair value of borrowings, but in the case of short-term maturity, carrying amount is a reasonable approximation of fair value.

Debentures		Fair value is determined by using valuation results 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.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

5.1.2 Fair value hierarchy

The Company believes that valuation techniques used for measuring the fair value of financial instruments are reasonable and that the fair value recognized in the statements of financial position is appropriate. However, the fair value of the financial instruments recognized in the statements 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 Company 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.

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

Fair value hierarchy of financial assets at fair value in the statements of financial position as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Fair value hierarchy						Total
	Level 1		Level 2		Level 3		Total
Financial assets
Financial assets at fair value through profit or loss:
Hybrid securities		—		—		992,124		992,124
Beneficiary certificates		—		511,056		—		511,056
Loans		—		45,751		—		45,751

		—		556,807		992,124		1,548,931


(In millions of Korean won)	December 31, 2022
	Fair value hierarchy						Total
	Level 1		Level 2		Level 3		Total
Financial assets
Financial assets at fair value through profit or loss:
Hybrid securities		—		—		874,171		874,171
Beneficiary certificates				304,618		—		304,618
Loans		—		343,525		—		343,525

		—		648,143		874,171		1,522,314

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

5.1.2.1 Fair value hierarchy of financial assets and liabilities at fair value in the statements of financial position (cont’d)

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 June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

June 30, 2023

Fair value

Valuation
techniques

Inputs

Financial assets

Financial assets at fair value through profit or loss:

Beneficiary certificates

511,056

DCF model

Interest rate,

Discount
rate, etc.

Loans

45,751

DCF model

Interest rate,

Discount
rate, etc.

556,807

(In millions of Korean won)

December 31, 2022

Fair value

Valuation
techniques

Inputs

Financial assets

Financial assets at fair value through profit or loss:

Beneficiary certificates

304,618

DCF model

Interest rate,

Discount
rate, etc.

Loans

343,525

DCF model

Interest rate,

Discount
rate, etc.

648,143

5.1.2.2 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 June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Fair value hierarchy
	Level 1		Level 2		Level 3		Total
Financial assets
Cash and due from financial institutions 1		—		1,202,390		—		1,202,390
Loans measured at amortized cost 2		—		—		522,326		522,326
Other financial assets 3		—		—		58,216		58,216

		—		1,202,390		580,542		1,782,932

Financial liabilities
Debentures		—		3,918,534		—		3,918,534
Other financial liabilities 3		—		—		31,658		31,658

		—		3,918,534		31,658		3,950,192

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

5.1.2.2 Fair value hierarchy of financial assets and liabilities whose fair value is disclosed (cont’d)


(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		—		351,056		—		351,056
Loans measured at amortized cost 2		—		—		522,326		522,326
Other financial assets 3		—		—		44,841		44,841

		—		351,056		567,167		918,223

Financial liabilities
Debentures		—		4,576,973		—		4,576,973
Other financial liabilities 3		—		—		13,331		13,331

		—		4,576,973		13,331		4,590,304

1	For cash and due from financial institutions classified as level 2, carrying amount is a reasonable approximation of fair value.

2	Because loans measured at amortized cost classified as level 3 are loans with residual maturity of less than one year, carrying amounts are reasonable approximations of fair values.

3	For other financial assets and other financial liabilities classified as level 3, carrying amounts are reasonable approximations of fair values.

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 June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

Fair value

Valuation
techniques

Inputs

June 30,
2023

December 31,
2022

Financial liabilities

Debentures

3,918,534

4,576,973

DCF model

Discount rate

5.2 Disclosure of Fair Value Hierarchy Level 3

5.2.1 Valuation policy and process of Level 3 fair value

The Company uses external, independent and qualified valuation service to determine the fair value of financial instruments at the end of every reporting period.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

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

5.2.2.1 Changes in financial instruments classified as Level 3 of the fair value hierarchy for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023		2022
	Financial assets at fair value through profit or loss		Financial assets at fair value through profit or loss
Beginning		874,171		389,606
Total gains or losses:
- Profit or loss		17,953		(25,523	)
- Other comprehensive income		—		—
Purchases		100,000		300,000
Sales		—		—
Issues		—		—
Settlements		—		—
Transfers into Level 3		—		—
Transfers out of Level 3		—		—

Ending		992,124		664,083

5.2.2.2 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 six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023						2022
	Gains on financial instruments at fair value through profit or loss		Other operating income		Net interest income		Losses on financial instruments at fair value through profit or loss			Other operating income		Net interest income
Total gains (losses) included in profit or loss for the period		17,953		—		—		(25,523	)		—		—
Total gains (losses) for the period included in profit or loss for financial instruments held at the end of the reporting period		17,953		—		—		(25,523	)		—		—

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

5.2.3 Sensitivity analysis of changes in unobservable inputs

5.2.3.1 Information about fair value measurements using unobservable inputs as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

June 30, 2023

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:

Hybrid securities

992,124

Hull and White Model, MonteCarlo Simulation

Matrix YTM, Additional spread by grade, Risk spread of company, Valid credit rating, Disclosed information of securities, Estimated volatility of Interest rate

Discount rate

4.95 ~ 6.87

The lower the discount rate, the higher the fair value

Volatility of interest rate

0.62

The higher the volatility, the higher the fair value fluctuation

(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:

Hybrid securities

874,171

Hull and White Model, MonteCarlo Simulation

Matrix YTM, Additional spread by grade, Risk spread of company, Valid credit rating, Disclosed information of securities, Estimated volatility of Interest rate

Discount rate

5.54 ~ 7.05

The lower the discount rate, the higher the fair value

Volatility of interest rate

0.64

The higher the volatility, the higher the fair value fluctuation

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

5.2.3.2 Sensitivity analysis of changes in unobservable inputs

Results of the sensitivity analysis of changes in unobservable inputs as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

June 30, 2023

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:

Hybrid securities *

8,504

(8,309

)

—

*	The changes in fair value are calculated by increasing or decreasing discount rates (4.95% ~ 6.87%) by 1%p, which are principal unobservable input parameters.

(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:

Hybrid securities *

10,460

(10,199

)

—

*	The changes in fair value are calculated by increasing or decreasing discount rates (5.54% ~ 7.05%) by 1%p, which are principal unobservable input parameters.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

6. Due from Financial Institutions

6.1 Details of due from financial institutions as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

Financial Institution

Interest rate (%)

as of

June 30,

2023

June 30,
2023

December 31,
2022

Due from financial institutions in Korean won

Due from banks

Kookmin Bank

0.00 ~ 3.00

1,112,390

231,056

KB Savings Bank Co., Ltd.

2.65 ~ 2.90

90,000

120,000

1,202,390

351,056

6.2 Details of restricted due from financial institution as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

Financial Institution

June 30,
2023

December 31,
2022

Reasons of restriction

Due from financial institutions in Korean won

Kookmin
Bank

Pledged as collateral for the overdraft account

7. Financial Assets at Fair Value through Profit or Loss

Details of financial assets at fair value through profit or loss as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Financial assets at fair value through profit or loss:
Hybrid securities		992,124		874,171
Beneficiary certificates		511,056		304,618
Loans		45,751		343,525

		1,548,931		1,522,314

8. Loans Measured at Amortized Cost

8.1 Details of loans measured at amortized cost as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Loans measured at amortized cost		523,500			523,500
Less: Allowances for loan losses		(1,174	)		(1,174	)

		522,326			522,326

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

9. Investments in Subsidiaries

9.1 Details of subsidiaries as of June 30, 2023, are as follows:


Name of subsidiaries	Industry	Location
Kookmin Bank	Banking and foreign exchange transaction	Korea
KB Securities Co., Ltd.	Financial investment	Korea
KB Insurance Co., Ltd.	Non-life insurance	Korea
KB Kookmin Card Co., Ltd.	Credit card and installment financial business	Korea
KB Life Insurance Co., Ltd.	Life insurance	Korea
KB Asset Management Co., Ltd.	Investment advisory and investment trust	Korea
KB Capital Co., Ltd.	Financial leasing	Korea
KB Real Estate Trust Co., Ltd.	Real estate trust management	Korea
KB Savings Bank Co., Ltd.	Savings banking	Korea
KB Investment Co., Ltd.	Capital investment	Korea
KB Data System Co., Ltd.	System software, development and supply	Korea

9.2 Details of investments in subsidiaries as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won, except for shares)	As of June 30, 2023				Carrying amount
Name of subsidiaries	Number of issued shares		Ownership (%)		June 30, 2023		December 31, 2022
Kookmin Bank		404,379,116		100.00		14,821,721		14,821,721
KB Securities Co., Ltd.		298,620,424		100.00		3,342,391		3,342,391
KB Insurance Co., Ltd.		66,500,000		100.00		2,375,430		2,375,430
KB Kookmin Card Co., Ltd.		92,000,000		100.00		1,953,175		1,953,175
KB Life Insurance Co., Ltd. (former Prudential Life Insurance Company of Korea Ltd.) *		16,201,518		100.00		2,795,367		2,310,054
KB Asset Management Co., Ltd.		7,667,550		100.00		96,312		96,312
KB Capital Co., Ltd.		32,175,147		100.00		873,811		873,811
KB Life Insurance Co., Ltd. *1		—		—		—		485,314
KB Real Estate Trust Co., Ltd.		16,000,000		100.00		121,553		121,553
KB Savings Bank Co., Ltd.		8,001,912		100.00		176,813		176,813
KB Investment Co., Ltd.		22,525,328		100.00		154,910		154,910
KB Data System Co., Ltd.		800,000		100.00		6,334		6,334
KB Credit Information Co., Ltd. *2		—		—		—		23,620

						26,717,817		26,741,438

*1	KB Life Insurance Co., Ltd. (former Prudential Life Insurance Company of Korea Ltd.) merged with another existing KB Life Insurance Co., Ltd. on January 2, 2023, and issued 1,201,518 shares as the consideration.

On June 30, 2023, the Company sold its 100% shares of KB Credit Information Co., Ltd. to KB Kookmin Card Co., Ltd. As of the date of disposal, the carrying amount of investments in KB Credit Information Co., Ltd. recorded by the Company was 23,620 million. The difference between the carrying amount and the consideration transferred (amounted 27,635 million), excluding disposal related costs, was recognized as gains on the disposal of investments in subsidiaries (amounted 3,917 million)

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

10. Deferred Income Tax Assets and Liabilities

10.1 Details of deferred income tax assets and liabilities as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Assets			Liabilities			Net amount
Share-based payments		3,756			—			3,756
Membership rights		209			—			209
Defined benefit obligation		1,854			—			1,854
Plan assets		—			(2,228	)		(2,228	)
Short-term employee benefits		773			—			773
Losses on valuation of financial assets at fair value through profit or loss		7,080			—			7,080
Others		2,569			(2,439	)		130

		16,241			(4,667	)		11,574

Offsetting of deferred tax assets and liabilities		(4,667	)		4,667			—

		11,574			—			11,574


(In millions of Korean won)	December 31, 2022
	Assets			Liabilities			Net amount
Share-based payments		4,502			—			4,502
Membership rights		210			—			210
Defined benefit obligation		3,226			—			3,226
Plan assets		—			(3,393	)		(3,393	)
Short-term employee benefits		650			—			650
Losses on valuation of financial assets at fair value through profit or loss		14,795			—			14,795
Others		3,233			(3,319	)		(86	)

		26,616			(6,712	)		19,904

Offsetting of deferred tax assets and liabilities		(6,712	)		6,712			—

		19,904			—			19,904

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

11. Debentures

11.1 Details of debentures as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	Issuance date		Maturity date		Interest rate (%) as of June 30, 2023		June 30, 2023		December 31, 2022
Unguaranteed debentures No.15-3		May 12, 2016		May 12, 2026		2.01		200,000		200,000
Unguaranteed debentures No.16-3		May 27, 2016		May 27, 2023		—		—		150,000
Unguaranteed debentures No.18-3		Jul. 25, 2016		Jul. 25, 2026		1.69		80,000		80,000
Unguaranteed debentures No.19-3		Aug. 25, 2016		Aug. 25, 2026		1.69		120,000		120,000
Unguaranteed debentures No.25-4		May 24, 2017		May 24, 2027		2.62		80,000		80,000
Unguaranteed debentures No.26-2		Jun. 27, 2017		Jun. 27, 2024		2.34		200,000		200,000
Unguaranteed debentures No.27		Jul. 19, 2017		Jul. 19, 2024		2.41		100,000		100,000
Unguaranteed debentures No.28-2		Aug. 30, 2017		Aug. 30, 2024		2.43		30,000		30,000
Unguaranteed debentures No.28-3		Aug. 30, 2017		Aug. 30, 2027		2.60		60,000		60,000
Unguaranteed debentures No.29-2		Sep. 19, 2017		Sep. 19, 2024		2.44		110,000		110,000
Unguaranteed debentures No.31-2		Feb. 28, 2018		Feb. 28, 2023		—		—		50,000
Unguaranteed debentures No.31-3		Feb. 28, 2018		Feb. 28, 2028		3.02		60,000		60,000
Unguaranteed debentures No.32-2		Apr. 6, 2018		Apr. 6, 2023		—		—		80,000
Unguaranteed debentures No.32-3		Apr. 6, 2018		Apr. 6, 2028		2.86		20,000		20,000
Unguaranteed debentures No.33-1		Jun. 12, 2018		Jun. 12, 2023		—		—		100,000
Unguaranteed debentures No.33-2		Jun. 12, 2018		Jun. 12, 2028		2.92		30,000		30,000
Unguaranteed debentures No.34-2		Jul. 25, 2018		Jul. 25, 2023		2.65		70,000		70,000
Unguaranteed debentures No.34-3		Jul. 25, 2018		Jul. 25, 2025		2.71		20,000		20,000
Unguaranteed debentures No.34-4		Jul. 25, 2018		Jul. 25, 2028		2.76		20,000		20,000
Unguaranteed debentures No.35		Oct. 5, 2018		Oct. 5, 2023		2.52		120,000		120,000
Unguaranteed debentures No.36-2		Feb. 22, 2019		Feb. 22, 2024		2.11		230,000		230,000
Unguaranteed debentures No.36-3		Feb. 22, 2019		Feb. 22, 2029		2.22		60,000		60,000
Unguaranteed debentures No.37-1		Mar. 15, 2019		Mar. 15, 2024		2.06		140,000		140,000
Unguaranteed debentures No.37-2		Mar. 15, 2019		Mar. 15, 2029		2.16		70,000		70,000
Unguaranteed debentures No.38-1		Jun. 19, 2019		Jun. 19, 2026		1.73		80,000		80,000
Unguaranteed debentures No.38-2		Jun. 19, 2019		Jun. 19, 2029		1.77		120,000		120,000
Unguaranteed debentures No.39-1		Oct. 15, 2019		Oct. 15, 2024		1.60		80,000		80,000
Unguaranteed debentures No.39-2		Oct. 15, 2019		Oct. 15, 2029		1.67		40,000		40,000
Unguaranteed debentures No.40-1		Dec. 4, 2019		Dec. 4, 2024		1.76		70,000		70,000
Unguaranteed debentures No.40-2		Dec. 4, 2019		Dec. 4, 2029		1.87		30,000		30,000
Unguaranteed debentures No.41-1		Jan. 16, 2020		Jan. 16, 2023		—		—		110,000
Unguaranteed debentures No.41-2		Jan. 16, 2020		Jan. 16, 2025		1.74		100,000		100,000
Unguaranteed debentures No.41-3		Jan. 16, 2020		Jan. 16, 2030		1.88		40,000		40,000
Subordinated debentures No.1-1		Feb. 18, 2020		Feb. 18, 2030		2.21		370,000		370,000
Subordinated debentures No.1-2		Feb. 18, 2020		Feb. 18, 2035		2.26		30,000		30,000
Unguaranteed debentures No.42-1		May 13, 2020		May 13, 2025		1.59		130,000		130,000
Unguaranteed debentures No.42-2		May 13, 2020		May 13, 2030		1.78		70,000		70,000
Unguaranteed debentures No.43-1		Jun. 16, 2020		Jun. 16, 2023		—		—		50,000
Unguaranteed debentures No.43-2		Jun. 16, 2020		Jun. 16, 2025		1.44		110,000		110,000
Unguaranteed debentures No.43-3		Jun. 16, 2020		Jun. 16, 2030		1.63		50,000		50,000
Exchangeable bonds No.1 *		Jun. 30, 2020		Jun. 30, 2025		—		240,000		240,000
Unguaranteed debentures No.44-2		Aug. 11, 2020		Aug. 11, 2023		1.07		50,000		50,000
Unguaranteed debentures No.44-3		Aug. 11, 2020		Aug. 9, 2024		1.18		30,000		30,000

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

11.1 Details of debentures as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)	Issuance date		Maturity date		Interest rate (%) as of June 30, 2023		June 30, 2023			December 31, 2022
Unguaranteed debentures No.44-4		Aug. 11, 2020		Aug. 11, 2027		1.39		20,000			20,000
Unguaranteed debentures No.45		Nov. 23, 2020		Nov. 23, 2023		1.19		60,000			60,000
Unguaranteed debentures No.46-1		Jan. 14, 2021		Jan. 13, 2023		—		—			160,000
Unguaranteed debentures No.46-2		Jan. 14, 2021		Jan. 14, 2026		1.43		30,000			30,000
Unguaranteed debentures No.46-3		Jan. 14, 2021		Jan. 14, 2028		1.62		10,000			10,000
Unguaranteed debentures No.46-4		Jan. 14, 2021		Jan. 14, 2031		1.84		100,000			100,000
Unguaranteed debentures No.47		Feb. 24, 2021		Feb. 24, 2023		—		—			90,000
Unguaranteed debentures No.48-1		Jun. 16, 2022		Jun. 17, 2024		4.15		85,000			85,000
Unguaranteed debentures No.48-2		Jun. 16, 2022		Jun. 16, 2025		4.27		240,000			240,000
Unguaranteed debentures No.48-3		Jun. 16, 2022		Jun. 16, 2027		4.34		80,000			80,000
Unguaranteed debentures No.48-4		Jun. 16, 2022		Jun. 16, 2032		4.40		95,000			95,000

								4,180,000			4,970,000
				Less: Bond Discounts				(3,783	)		(4,616	)
				Less: adjustment on exchange right				(6,783	)		(8,435	)

								4,169,434			4,956,949

Fair value of the liability component of exchangeable bonds is calculated by using market interest rate of bonds under the same conditions without the exchange right. The residual amount, after deducting liability component from the issuance amount, represents the value of exchange right and is recorded in equity. Shares to be exchanged are 5 million treasury shares of KB Financial Group Inc. with the exchange price of 48,000. Exercise period for exchange right is from the 60th day of the issuance date to 10 business days before the maturity date.

11.2 Maturities of debentures as of June 30, 2023 and December 31 2022, are as follows:


(In millions of Korean won)	June 30, 2023
	Up to 3 months		3~6 months		6~12 months		1~3 years		Over 3 years		Total
Debentures in Korean won		120,000		180,000		655,000		1,570,000		1,655,000		4,180,000


(In millions of Korean won)	December 31, 2022
	Up to 3 months		3~6 months		6~12 months		1~3 years		Over 3 years		Total
Debentures in Korean won		410,000		380,000		300,000		1,915,000		1,965,000		4,970,000

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

11.3 Changes in debentures based on par value for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Beginning		Issue		Repayment			Ending
Debentures in Korean won		4,970,000		—		(790,000	)		4,180,000


(In millions of Korean won)	2022
	Beginning		Issue		Repayment			Ending
Debentures in Korean won		5,570,000		500,000		(730,000	)		5,340,000

12. Net Defined Benefit Liabilities(Assets)

12.1 Defined Benefit Plan

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

•

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

•

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

The net defined benefit liabilities 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.

12.2 Details of the net defined benefit liabilities as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Present value of defined benefit obligation		17,781			17,973
Fair value of plan assets		(21,313	)		(22,261	)

Net defined benefit liabilities (assets)		(3,532	)		(4,288	)

12.3 Details of post-employment benefits recognized in profit or loss for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Current service cost		908			1,152
Net interest expense(income) on net defined benefit liabilities		(111	)		(3	)

Post-employment benefits		797			1,149

(*)	The gains or losses related to the defined benefit pension plan is fully included in general administrative expenses.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

13. Equity

13.1 Share Capital

13.1.1 Details of share capital as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
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		403,511,072		408,897,068
Share capital *		2,090,558		2,090,558

*	Due to the retirement of shares deducted through retained earnings, it is different from the total par value of the shares issued.

13.1.2 Changes in shares for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In number of shares)	2023			2022
Beginning		389,634,335			389,634,335
Increase		—			—
Decrease		(5,385,996	)		—

Ending		384,248,339			389,634,335

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

13.2 Hybrid Securities

Details of hybrid securities classified as equity as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)


Hybrid securities	Issuance date	Maturity	Interest rate (%) as of June 30, 2023		June 30, 2023		December 31, 2022
The 1-1st	May 2, 2019	Perpetual bond		3.23		349,204		349,204
The 1-2nd	May 2, 2019	Perpetual bond		3.44		49,881		49,881
The 2-1st	May 8, 2020	Perpetual bond		3.30		324,099		324,099
The 2-2nd	May 8, 2020	Perpetual bond		3.43		74,812		74,812
The 3-1st	Jul. 14, 2020	Perpetual bond		3.17		369,099		369,099
The 3-2nd	Jul. 14, 2020	Perpetual bond		3.38		29,922		29,922
The 4-1st	Oct. 20, 2020	Perpetual bond		3.00		433,918		433,918
The 4-2nd	Oct. 20, 2020	Perpetual bond		3.28		64,843		64,843
The 5-1st	Feb. 19, 2021	Perpetual bond		2.67		419,056		419,056
The 5-2nd	Feb. 19, 2021	Perpetual bond		2.87		59,862		59,862
The 5-3rd	Feb. 19, 2021	Perpetual bond		3.28		119,727		119,727
The 6-1st	May 28, 2021	Perpetual bond		3.20		165,563		165,563
The 6-2nd	May 28, 2021	Perpetual bond		3.60		109,708		109,708
The 7-1st	Oct. 8, 2021	Perpetual bond		3.57		208,453		208,453
The 7-2nd	Oct. 8, 2021	Perpetual bond		3.80		59,834		59,834
The 8-1st	Feb. 16, 2022	Perpetual bond		4.00		442,955		442,955
The 8-2nd	Feb. 16, 2022	Perpetual bond		4.30		155,626		155,626
The 9-1st	May 12, 2022	Perpetual bond		4.68		478,814		478,814
The 9-2nd	May 12, 2022	Perpetual bond		4.97		19,906		19,906
The 10-1st	Aug. 26, 2022	Perpetual bond		4.90		407,936		407,936
The 10-2nd	Aug. 26, 2022	Perpetual bond		5.15		70,819		70,819
The 10-3rd	Aug. 26, 2022	Perpetual bond		5.30		19,944		19,944
The 11-1st	Feb 3, 2023	Perpetual bond		4.90		548,666		—
The 11-2nd	Feb 3, 2023	Perpetual bond		5.03		49,871		—

						5,032,518		4,433,981

The above hybrid securities are early redeemable by the Company after 5 or 7or 10 years from the issuance date.

13.3 Capital Surplus

Details of capital surplus as of June 30, 2023 and December 31,2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Paid-in capital in excess of par value		13,190,275		13,190,275
Other capital surplus		1,465,893		1,465,893
Gains on sales of treasury shares		86,646		86,646
Consideration for exchange right of exchangeable bonds		11,933		11,933

		14,754,747		14,754,747

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

13.4 Accumulated Other Comprehensive Income (Loss)

Details of accumulated other comprehensive income (loss) as of June 30, 2023 and December 31,2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Remeasurements of net defined benefit liabilities		(5,822	)		(5,847	)

13.5 Retained Earnings

13.5.1 Details of retained earnings as of June 30, 2023 and December 31,2022, are as follows:


(In millions of Korean won)	June 30, 2023		December 31, 2022
Legal reserves		1,007,685		839,235
Voluntary reserves		982,000		982,000
Regulatory reserve for credit losses		9,340		4,490
Unappropriated retained earnings		2,860,212		1,968,840

		4,859,237		3,794,565

With respect to the allocation of net profit earned in a fiscal term, the Company 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 53 of the Financial Holding Company Act. The reserve is not available for the payment of cash dividends, but may be transferred to share capital, or used to reduce accumulated deficit.

13.5.2 Regulatory reserve for credit losses

Measurement and disclosure of regulatory reserve for credit losses are required in accordance with Articles 26 through 28 of the Regulations on Supervision of Financial Holding Companies.

13.5.2.1 Details of regulatory reserve for credit losses as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Amounts before appropriation		9,340			4,490
Amounts estimated to be appropriated (reversed)		(4,514	)		4,850

		4,826			9,340

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

13.5.2.2 Regulatory reserve for credit losses estimated to be appropriated (reversed) and adjusted profit after provision (reversal) of regulatory reserve for credit losses for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won, except for per share amounts)	2023						2022
(In millions of Korean won, except for per share amounts)	Three months			Six months			Three months			Six months
Regulatory reserve for credit losses estimated to be appropriated (reversed)		(3,676	)		(4,514	)		(720	)		1,198
Adjusted profit (loss) after provision (reversal) of regulatory reserve for credit losses 1,2		(70,843	)		2,072,218			(82,052	)		1,517,302
Adjusted basic earnings (loss) per share after provision (reversal) of regulatory reserve for credit losses 1		(184	)		5,366			(211	)		3,894
Adjusted diluted earnings (loss) per share after provision (reversal) of regulatory reserve for credit losses 1		(179	)		5,246			(205	)		3,808

1	Adjusted profit (loss) after provision (reversal) of regulatory reserve for credit losses is not based on Korean IFRS. It is calculated by reflecting provision (reversal) of regulatory reserve for credit losses before tax to the net profit for the period.

2	After deducting dividends on hybrid securities

13.6 Treasury Shares

Changes in treasury shares for the six-month periods ended June 30, 2023 and 2022, are as follows:

(In millions of Korean won and in number of shares)


	2023
	Beginning		Acquisition		Retirement			Ending
Number of treasury shares *		19,262,733		5,385,996		(5,385,996	)		19,262,733

Carrying amount		836,188		271,745		(242,096	)		865,837

(In millions of Korean won and in number of shares)


	2022
	Beginning		Acquisition		Retirement			Ending
Number of treasury shares *		26,173,585		—		(3,455,426	)		22,718,159

Carrying amount		1,136,188		—		(150,000	)		986,188

*	5 million treasury shares are deposited at the Korea Securities Depository for the exchange of exchangeable bonds.

14. Dividends

The annual dividends to the shareholders of the Company for the year ended December 31, 2022, amounting to 564,970 million (1,450 per share) were declared at the annual general shareholders’ meeting on March 24, 2023 and paid in April 10, 2023. According to the resolution of the Board of Directors on April 27, 2023, the interim dividends per share of 510 (total dividends: 195,967 million) with dividend record date of March 31, 2023 were paid on May 11, 2023. Meanwhile, the annual dividends and interim dividends paid in 2022 were 853,299 million (2,190 per share) and 584,452 million (500 per share), respectively.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

15. Net Interest Expense

Details of interest income, interest expense, and net interest expense for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023						2022
	Three months			Six months			Three months			Six months
Interest income
Due from financial institutions		7,446			9,682			2,182			3,160
Loans measured at amortized cost		3,210			6,390			1,426			2,809
Loans measured at fair value through profit or loss		679			1,798			659			1,320
Others		144			279			102			196

		11,479			18,149			4,369			7,485

Interest expense
Debentures		24,852			51,570			26,730			54,584
Others		7			13			4			8

		24,859			51,583			26,734			54,592

Net interest expense		(13,380	)		(33,434	)		(22,365	)		(47,107	)

16. Net Fee and Commission Expense

Details of fee and commission income, fee and commission expense, and net fee and commission expense for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023						2022
	Three months			Six months			Three months			Six months
Fee and commission income
Fees earned in Korean won		409			781			356			1,159

Fee and commission expense
Fees paid in Korean won		3,498			4,957			3,724			5,154
Fees paid in foreign currency		—			160			—			140

		3,498			5,117			3,724			5,294

Net fee and commission expense		(3,089	)		(4,336	)		(3,368	)		(4,135	)

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

17. 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 assets at fair value through profit or loss for the three-month and six-month periods ended June, 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023					2022
	Three months			Six months		Three months			Six months
Gains on financial instruments at fair value through profit or loss
Dividend income from financial assets at fair value through profit or loss		12,931			25,178		8,914			14,894
Gains on valuation of financial assets at fair value through profit or loss		(5,409	)		27,094		1,145			2,366
Gains on disposal of financial assets at fair value through profit or loss		—			678		—			—

		7,522			52,950		10,059			17,260

Losses on financial instruments at fair value through profit or loss
Losses on valuation of financial assets at fair value through profit or loss		1,280			1,280		26,494			34,120

		1,280			1,280		26,494			34,120

Net gains (losses) on financial instruments at fair value through profit or loss		6,242			51,670		(16,435	)		(16,860	)

18. Net Other Operating Income and Expenses

Details of other operating income and expenses for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023				2022
	Three months		Six months		Three months		Six months
Other operating income
Dividend income from subsidiaries		—		2,192,380		—		1,671,223
Others		—		—		—		1

		—		2,192,380		—		1,671,224

Net other operating income		—		2,192,380		—		1,671,224

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

19. General and Administrative Expenses

19.1 Details of general and administrative expenses for the three-month and six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023				2022
	Three months		Six months		Three months			Six months
Expenses related to employee
Employee benefits - salaries		9,651		19,473		10,043			19,841
Employee benefits - others		1,336		2,259		1,108			2,154
Post-employment benefits - defined benefit plans		395		797		614			1,149
Post-employment benefits - defined contribution plans		—		1		—			(2	)
Share-based payments		1,788		2,886		(1,476	)		1,689

		13,170		25,416		10,289			24,831

Depreciation and amortization		1,271		2,717		1,475			2,838

Other general and administrative expenses
Travel		537		749		166			196
Communications		244		571		244			554
Tax and dues		98		337		98			314
Publication		131		186		110			175
Rental expense		534		1,055		445			863
Vehicle		42		68		41			66
Service fees		4,173		9,023		3,649			7,071
Advertising		76		515		73			453
Training		447		724		255			333
Others		2,256		4,520		2,080			3,952

		8,538		17,748		7,161			13,977

		22,979		45,881		18,925			41,646

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

19.2 Share-based Payments

Share-based payments plan for executives and employees of the Company and its subsidiaries as of June 30, 2023, are as follows:

19.2.1 Stock grants linked to long-term performance


(In number of shares)	Grant date	Number of granted shares 1		Vesting conditions 2
KB Financial Group Inc.
Series 28	Nov. 21, 2020		68,135	Services fulfillment, market performance 3 35%, and non-market performance 5 65%
Series 30	Apr. 1, 2021		3,070	Services fulfillment, market performance 3 30%, and non-market performance 4 70%
Series 33	Jan. 1, 2022		57,464	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 34	Feb. 1, 2022		654	Services fulfillment, market performance 3 30%, and non-market performance 4 70%
Series 35	May 27, 2022		6,364	Services fulfillment, market performance 3 30%, and non-market performance 4 70%
Series 36	Jan 1, 2023		83,561	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Deferred grant in 2015			3,183	Satisfied
Deferred grant in 2016			943	Satisfied
Deferred grant in 2018			884	Satisfied
Deferred grant in 2020			18,871	Satisfied
Deferred grant in 2021			18,105	Satisfied
Deferred grant in 2022			38,277	Satisfied

			299,511

Kookmin Bank
Series 83	Apr. 1, 2021		14,972	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 85	Jan. 1, 2022		259,724	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100% Services fulfillment, market performance 3 30%, and EPS & Asset Quality 6 70%
Series 86	Feb. 1, 2022		1,525	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 88	Mar. 14, 2022		5,884	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 90	Jul. 18, 2022		4,131	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 91	Aug. 24, 2022		7,277	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 92	Jan. 1, 2023		216,811	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%
Series 93	Apr. 1, 2023		13,422	Services fulfillment, market performance 3 0~30%, and non-market performance 4 70~100%

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

19.2.1 Stock grants linked to long-term performance (cont’d)


(In number of shares)	Grant date	Number of granted shares 1		Vesting conditions 2
Deferred grant in 2016			799	Satisfied
Deferred grant in 2017			893	Satisfied
Deferred grant in 2018			1,145	Satisfied
Deferred grant in 2020			26,763	Satisfied
Deferred grant in 2021			104,643	Satisfied
Deferred grant in 2022			87,342	Satisfied
Deferred grant in 2023			1,289	Satisfied

			746,620

Other subsidiaries
Stock granted in 2010			106
Stock granted in 2011			146
Stock granted in 2012			420
Stock granted in 2013			544
Stock granted in 2014			1,028
Stock granted in 2015			2,014
Stock granted in 2016			3,048
Stock granted in 2017			9,548	Services fulfillment,
Stock granted in 2018			19,861	market performance 3 0~50%,
Stock granted in 2019			23,788	and non-market performance 4 50~100%
Stock granted in 2020			94,348
Stock granted in 2021			120,615
Stock granted in 2022			389,083
Stock granted in 2023			374,944

			1,039,493

			2,085,624

1	Granted shares represent the total number of shares initially granted to executives and employees who have residual shares as of June 30, 2023 (Deferred grants are residual shares vested as of June 30, 2023).

3	Relative TSR (Total Shareholder Return): [(Fair value at the end of the contract—Fair value at the beginning of the contract) + (Total amount of dividend per share paid during the contract period)] / Fair value at the beginning of the contract

4	Performance results of company and employee

5	EPS (Earnings Per Share), Asset Quality, HCROI (Human Capital Return on Investment), Profit from non-banking segments

6	EPS, Asset Quality

The stock grant linked to long-term performance 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.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

19.2.2 Stock grants linked to short-term performance


(In number of shares)	Estimated number of vested shares *		Vesting conditions
KB Financial Group Inc.
Stock granted in 2015		2,097	Satisfied
Stock granted in 2016		3,034	Satisfied
Stock granted in 2017		306	Satisfied
Stock granted in 2018		380	Satisfied
Stock granted in 2020		12,336	Satisfied
Stock granted in 2021		23,677	Satisfied
Stock granted in 2022		45,115	Satisfied
Stock granted in 2023		26,578	Proportional to service period
Kookmin Bank
Stock granted in 2015		419	Satisfied
Stock granted in 2016		2,135	Satisfied
Stock granted in 2017		535	Satisfied
Stock granted in 2018		739	Satisfied
Stock granted in 2020		44,890	Satisfied
Stock granted in 2021		86,235	Satisfied
Stock granted in 2022		164,595	Satisfied
Stock granted in 2023		74,281	Proportional to service period
Other subsidiaries
Stock granted in 2015		4,048	Satisfied
Stock granted in 2016		18,144	Satisfied
Stock granted in 2017		35,359	Satisfied
Stock granted in 2018		82,096	Satisfied
Stock granted in 2019		91,957	Satisfied
Stock granted in 2020		262,400	Satisfied
Stock granted in 2021		464,576	Satisfied
Stock granted in 2022		511,024	Satisfied
Stock granted in 2023		171,784	Proportional to service period

		2,128,740

Share-based payments arrangement for subsidiaries was transferred to the Company in 2010, and the related compensation cost paid to the executives and employees of subsidiaries is reimbursed by subsidiaries. The accrued expenses for share-based payments as of June 30, 2023 and December 31, 2022, are 154,984 million and 186,908 million, respectively, and the receivables to be reimbursed by subsidiaries for the compensation costs as of June 30, 2023 and December 31, 2022, are 140,756 million and 169,918 million, respectively. And compensation costs from share-based payments amounting to 2,886 million and 1,689 million were recognized for the six-month periods ended June 30, 2023 and 2022, respectively.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

20. Income Tax Benefit (Expense)

Details of income tax benefit (expense) for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Income tax payable		—			—
Changes in deferred tax assets and liabilities
Origination and reversal of temporary differences		(8,330	)		8,750
Income tax recognized directly in equity
Remeasurements of net defined benefit liabilities		9			(106	)

Income tax benefit (expense)		(8,321	)		8,644

21. Earnings per Share

21.1 Basic Earnings per Share

Basic earnings per share is calculated from the earnings attributable to ordinary shares.

21.1.1 Weighted average number of ordinary shares outstanding


(In number of shares)	2023						2022
	Three months			Six months			Three months			Six months
Number of issued ordinary shares		403,511,072			403,511,072			412,352,494			412,352,494
Number of treasury shares *		(19,262,733	)		(19,262,733	)		(22,718,159	)		(22,718,159	)

Weighted average number of ordinary shares outstanding		384,248,339			386,170,890			389,634,335			389,634,335

*	Treasury stock retired during the six-month period ended June 30, 2022 were deducted from February 14, 2022.

21.1.2 Basic earnings per share


(In Korean won and in number of shares)	2023
	Three months			Six months
Profit (loss) for the period		(26,449,014,645	)		2,156,477,988,072
Deduction: Dividends on hybrid securities		(48,070,325,000	)		(88,774,400,000	)

Profit (loss) attributable to the ordinary equity holders (A)		(74,519,339,645	)		2,067,703,588,072
Weighted average number of ordinary shares outstanding (B)		384,248,339			386,170,890

Basic earnings (loss) per share (A/B)		(194	)		5,354


(In Korean won and in number of shares)	2022
	Three months			Six months
Profit (loss) for the period		(54,121,779,560	)		1,569,682,848,806
Deduction: Dividends on hybrid securities		(28,650,200,000	)		(51,183,400,000	)

Profit (loss) attributable to the ordinary equity holders (A)		(82,771,979,560	)		1,518,499,448,806
Weighted average number of ordinary shares outstanding (B)		389,634,335			389,634,335

Basic earnings (loss) per share (A/B)		(212	)		3,897

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

21.2 Diluted Earnings per Share

Diluted earnings per share is calculated through increasing the weighted average number of ordinary shares outstanding by the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares. The Company has dilutive potential ordinary shares such as stock grants and ordinary share exchange right of exchangeable bonds.

A calculation is done to determine the number of shares that could have been acquired at fair value (determined as the average market share price for the year) based on the monetary value of stock grants. The number of shares calculated above is compared with the number of shares that would have been issued assuming the settlement of stock grants.

21.2.1 Adjusted profit for diluted earnings per share


(In Korean won)	2023
	Three months			Six months
Profit (loss) attributable to the ordinary equity holders *		(74,519,339,645	)		2,067,703,588,072
Adjustment:
Interest expense on exchangeable bonds		611,283,413			1,215,849,425

Adjusted profit (loss) for diluted earnings (loss) per share		(73,908,056,232	)		2,068,919,437,497


(In Korean won)	2022
	Three months			Six months
Profit (loss) attributable to the ordinary equity holders *		(82,771,979,560	)		1,518,499,448,806
Adjustment:
Interest expense on exchangeable bonds		593,607,663			1,180,692,166

Adjusted profit (loss) for diluted earnings (loss) per share		(82,178,371,897	)		1,519,680,140,972

*	The amount is after deducting dividends on hybrid securities.

21.2.2 Weighted average number of ordinary shares outstanding for diluted earnings per share


(In number of shares)	2023				2022
	Three months		Six months		Three months		Six months
Weighted average number of ordinary shares outstanding		384,248,339		386,170,890		389,634,335		389,634,335
Adjustment:
Stock grants		3,686,627		4,099,113		3,676,844		4,135,955
Exchangeable bonds		5,000,000		5,000,000		5,000,000		5,000,000

Adjusted weighted average number of ordinary shares outstanding for diluted earnings (loss) per share		392,934,966		395,270,003		398,311,179		398,770,290

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

21.2.3 Diluted earnings per share


(In Korean won and in number of shares)	2023
	Three months			Six months
Adjusted profit (loss) for diluted earnings (loss) per share		(73,908,056,232	)		2,068,919,437,497
Adjusted weighted average number of ordinary shares outstanding for diluted earnings (loss) per share		392,934,966			395,270,003

Diluted earnings (loss) per share		(188	)		5,234


(In Korean won and in number of shares)	2022
	Three months			Six months
Adjusted profit (loss) for diluted earnings (loss) per share		(82,178,371,897	)		1,519,680,140,972
Adjusted weighted average number of ordinary shares outstanding for diluted earnings (loss) per share		398,311,179			398,770,290

Diluted earnings (loss) per share		(206	)		3,811

22. Statement of Cash Flows

22.1 Details of cash and cash equivalents as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)	June 30, 2023			December 31, 2022
Due from financial institutions		1,202,390			351,056
Deduction:
Restricted due from financial institutions		(3	)		(3	)
Due from financial institutions with original maturities over three months		(90,000	)		(120,000	)

		(90,003	)		(120,003	)

		1,112,387			231,053

22.2 Significant non-cash transactions for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023			2022
Changes in receivables and payables from consolidated tax return		468,242			862,503
Changes in receivables and payables related to stock grants		(29,161	)		(36,732	)

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

22.3 Cash inflows and outflows from income tax, interest, and dividends for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	Activity	2023		2022
Income tax paid	Operating		4,197		2,263
Interest received	Operating		10,144		5,949
Interest paid	Operating		51,390		52,709
Dividends received	Operating		2,219,071		1,685,357
Dividends paid	Financing		849,711		1,099,299

23. Contingent Liabilities and Commitments

23.1 Commitments made with financial institutions as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)		June 30, 2023				December 31, 2022
		Amount of commitments		Amount borrowed		Amount of commitments		Amount borrowed
General loan	Hana Bank		200,000		—		200,000		—
General loan	Shinhan Bank		200,000		—		—		—
General loan	NongHyup Bank		300,000		—		—		—

23.2 Other Matters (including litigation)

The Company has 1 pending lawsuit as a defendant with aggregate claims amount of 0.1 million, which arose in the normal course of the management activities, as of June 30, 2023.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

24. Related Party Transactions

According to Korean IFRS No.1024, the Company includes subsidiaries and key management personnel (including family members) in the scope of related parties. The Company discloses balances (receivables and payables) and other amounts arising from transactions with related parties in the notes to the financial statements. Refer to Note 9 for details of subsidiaries. Key management personnel include the executives of the Company, their close family members, and the companies where the executives and/or their close family members have control or joint control.

24.1 Details of significant profit or loss arising from transactions with related parties for the six-month periods ended June 30, 2023 and 2022 are as follows:


(In millions of Korean won)

Subsidiaries	Profit or loss	2023		2022
Kookmin Bank	Interest income		8,393		2,538
	Fee and commission income		608		758
	Net other operating income *1		1,346,582		1,031,167
	General and administrative expenses		5,778		5,542
KB Securities Co., Ltd.	Interest expense		—		15
	Fee and commission income		43		133
	Net losses on financial assets at fair value through profit or loss		19,588		(13,493	)
	Net other operating income *1		100,000		200,000
	General and administrative expenses		172		434
KB Insurance Co., Ltd.	Fee and commission income		73		183
	General and administrative expenses		875		970
	Net other operating income *1		349,990		—
KB Kookmin Card Co., Ltd.	Fee and commission income		17		42
	Net other operating income *1		200,008		250,056
	General and administrative expenses		183		15
	Net non-operating income *2		3,920		3
KB Life Insurance Co., Ltd.	Fee and commission income		23		32
	Net other operating income *1		100,000		100,000
	General and administrative expenses		567		350
KB Asset Management Co., Ltd.	Net other operating income *1		60,000		40,000
KB Capital Co., Ltd	Interest income		2,381		—
	Fee and commission income		8		17
	Net gains on financial assets at fair value through profit or loss		23,542		2,863
	Provision for credit losses		3		—
KB Life Insurance Co., Ltd.	Fee and commission income		—		25
	General and administrative expenses		—		139
KB Real Estate Trust. Co., Ltd.	Net other operating income *1		35,000		40,000

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

24.1 Details of significant profit or loss arising from transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows: (cont’d)


(In millions of Korean won)

Subsidiaries	Profit or loss	2023		2022
KB Savings Bank Co., Ltd.	Interest income		2,296		1,576
	Fee and commission income		1		1
	Net gains (losses) on financial assets at fair value through profit or loss		1,423		(6,529	)
KB Investment Co., Ltd.	Interest income		3,848		2,809
	Net other operating income *1		—		10,000
	Provision (reversal) for credit losses		5		2
KB Data Systems Co., Ltd.	General and administrative expenses		1,440		1,232
	Net other operating income *1		600		—

Other related parties	Profit or loss	2023		2022
KB Credit Information Co., Ltd. *3	Interest income		161		—
	Net other operating income *1		200		—

*1	Net other operating income includes dividend income from subsidiaries.

*2	Includes 3,917 million of gains on disposal of investments in KB Credit Information Co., Ltd.

*3	The Company sold the 100% shares of KB Credit Information Co., Ltd. to Kookmin Card Co., Ltd. on June 30, 2023.

24.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows:


(In millions of Korean won)
Subsidiaries	Assets or liabilities	June 30, 2023		December 31, 2022
Kookmin Bank	Cash and due from financial institutions		1,112,390		231,056
	Other assets		360,247		828,505
	Other liabilities		4,797		97
	Property and equipment		117		357
KB Securities Co., Ltd.	Financial assets at fair value through profit or loss		509,982		401,732
	Other assets		91,930		66,162
	Other liabilities		251		116,503
KB Insurance Co., Ltd.	Other assets		17,647		111,433
	Other liabilities		559		47
KB Kookmin Card Co., Ltd.	Other assets		69,092		88,968
	Other liabilities		943		755
KB Life Insurance Co., Ltd.	Other assets		56,447		70,534
	Other liabilities		630		67
KB Asset Management Co., Ltd.	Other assets		11,827		21,033

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

24.2 Details of significant outstanding balances of receivables and payables arising from transactions with related parties as of June 30, 2023 and December 31, 2022, are as follows: (cont’d)


(In millions of Korean won)
Subsidiaries	Assets or liabilities	June 30, 2023		December 31, 2022
KB Capital Co., Ltd.	Financial assets at fair value through profit or loss		482,142		472,439
	Loans measured at amortized cost (gross amount)		200,000		200,000
	Allowances for credit losses		234		234
	Other assets		32,979		52,941
KB Life Insurance Co., Ltd.	Other assets		—		4,655
	Other liabilities		—		9,188
KB Real Estate Trust Co., Ltd.	Other assets		12,377		8,860
KB Savings Bank Co., Ltd.	Cash and due from financial institutions		90,000		120,000
	Financial assets at fair value through profit or loss		45,750		43,524
	Other assets		4,473		7,280
	Other liabilities		86		67
KB Investment Co., Ltd.	Loans measured at amortized cost (gross amount)		310,000		310,000
	Allowances for credit losses		924		924
	Other assets		7,580		5,943
KB Data Systems Co., Ltd.	Intangible assets		331		1,716
	Other assets		1,650		3,456
	Other liabilities		210		208

Other related parties	Assets or liabilities	2023		2022
KB Credit Information Co., Ltd. *1	Loans measured at amortized cost (gross amount)		13,500		13,500
	Allowances for credit losses		16		16
	Other assets		926		1,054
	Other liabilities		30		61

*1	The Company sold the 100% shares of KB Credit Information Co., Ltd. to Kookmin Card Co., Ltd. on June 30, 2023.

24.3 Right-of-use assets and lease liabilities with related parties as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

June 30,
2023

December 31,
2022

Subsidiary

Kookmin Bank

Right-of-use assets

117

357

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

24.4 Unused commitments provided from related parties as of June 30, 2023 and December 31, 2022, are as follows:

(In millions of Korean won)

June 30,
2023

December 31,
2022

Subsidiary

KB Kookmin Card Co., Ltd.

Unused lines of credit for credit card

2,240

2,245

24.5 Share transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)			2023		2022
Subsidiary	KB Capital Co., Ltd.	Acquisition of hybrid securities		—		100,000
	KB Securities Co., Ltd.	Acquisition of hybrid securities		100,000		200,000
Other related party	KB Credit Information Co., Ltd.	Disposal of shares		23,620		—

24.6 Details of significant lending transactions with related parties for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)		2023
		Beginning		Loan		Collection		Ending
Subsidiary	KB Investment Co., Ltd.		310,000		—		—		310,000
	KB Capital Co., Ltd.		200,000		—		—		200,000
	KB Savings Bank Co., Ltd. *1		70,000		—		—		70,000
Other related party	KB Credit Information Co., Ltd. *2		13,500		—		—
					—		—		13,500


(In millions of Korean won)		2022
		Beginning		Loan		Collection		Ending
Subsidiary	KB Investment Co., Ltd.		250,000		—		—		250,000
	KB Savings Bank Co., Ltd. *		70,000		—		—		70,000

*1	Par value of subordinated bond issued by KB Savings Bank Co., Ltd. The difference between par value and fair value at the acquisition date was accounted for as investments in subsidiaries.

*2	The Company sold the 100% shares of KB Credit Information Co., Ltd. to Kookmin Card Co., Ltd. on June 30, 2023.

KB Financial Group Inc.

Notes to the Separate Interim Financial Statements

June 30, 2023 and 2022 (Unaudited), and December 31, 2022

24.7 Details of compensation to key management personnel for the six-month periods ended June 30, 2023 and 2022, are as follows:


(In millions of Korean won)	2023
	Short-term employee benefits		Post-employment benefits		Share-based payments		Total
Registered directors (executive)		645		32		585		1,262
Registered directors (non-executive)		327		—		—		327
Non-registered directors		3,417		132		2,301		5,850

		4,389		164		2,886		7,439


(In millions of Korean won)	2022
	Short-term employee benefits		Post-employment benefits		Share-based payments		Total
Registered director (executive)		650		16		209		875
Registered director (non-executive)		316		—		—		316
Non-registered director		3,434		70		1,480		4,984

		4,400		86		1,689		6,175

25. Events after the reporting period

According to the resolution of the Board of Directors on July 25, 2023, the interim dividends per share of 510 (total dividends: 195,966 million) with dividend record date of June 30, 2023 were paid on August 8, 2023. The Company’s financial statements as of June 30, 2023, do not reflect this dividends payable.

In accordance with the resolution of the Board of Directors on July 25, 2023, the Company plans to acquire and retire 6,295,907 shares (300,000 million) of treasury stocks on the market by July 31, 2024. However, the above number of stocks were computed based on the closing price (47,650) as of July 24, 2023, the day before the Board of Directors meeting (July 25, 2023); as such, the final number of treasury stocks to be retired may change according to stock price.