KB Financial Group Inc. Q3 FY2025 earnings call

• Approach to profitability: Mitigated external uncertainties via core deposit growth, NIM resilience, balanced nonbank portfolio, appropriate RWA growth. • Market shift: Korean economy moving from real estate to capital market; KBFG to leverage this to strengthen profit-making capacity. • Dividend: Board approved KRW 931 DPS, total cash dividend KRW 335.7 billion, up year-on-year due to dividend increase and share buyback. • Cost control: General G&A up 2.8% year-on-year, CIR stable, strategic investment in growth areas like AI. • Risk management: Provision for credit losses decreased due to conservative stance, portfolio improvement, NPL recovery. Capital adequacy high.

Group's net profit for Q3 was KRW 1.686 trillion, with cumulative net profit up to Q3 at KRW 5,121.7 billion, up 16.6% year-on-year. Cumulative nonbank business accounts for 37% of net profit. Net interest income: Q3 cumulative net interest income was KRW 9,704.9 billion, flat year-on-year. Q3 net interest income was KRW 3,336.2 billion, flat quarter-on-quarter after removing base effects. Bank loans in Won: End of Sept 2025, KRW 375 trillion, 3.3% year-on-year growth, 0.9% quarter-on-quarter. Household loans KRW 182 trillion, 0.7% quarter-on-quarter growth; corporate loans (large corps and SMEs) 1.0% quarter-on-quarter growth. NIM: Q3 bank NIM 1.74%, group NIM 1.96%, stable. Noninterest income: Q3 cumulative noninterest income KRW 3,739 billion, down 1.1% year-on-year. Other operating income KRW 786.6 billion, down 15.4% year-on-year (due to KB Insurance IBNR reserve reversal). Net fee income KRW 2,952.4 billion, up 3.5% year-on-year. General G&A: Q3 cumulative KRW 5,007.7 billion, up 2.8% year-on-year. CIR 37.2%, stable. Provision for credit losses: Q3 KRW 364.5 billion, down 44.4% quarter-on-quarter. Credit cost 30 bps quarter-on-quarter, 46 bps cumulative, trending lower. Capital ratio: End of Sept 2025, BIS ratio 16.28%, CET1 ratio 13.83%. Risk-weighted assets KRW 358 trillion, up 3.5% year-on-year, FX effect managed.

• NIM: Rate down-cycle slowed, core deposit increase, focus on expanding core deposit and reducing funding cost. Forecast NIM impact from market rate movement in H2, gradual decline in low single digits. • Provision: Credit cost expected to be around mid-40 bp range. • RWA: Expected RWA growth around 5% next year, aligned with government policy on productive finance. • Shareholder return: Considering mix of cash dividend and share buyback based on policy and taxation requirements.

• Fines/administrative penalties: Not finalized, actively responding, working to minimize impact on shareholder returns. • Interest rate and FX volatility: Impact on NIM and RWA, managed through monitoring and portfolio adjustment. • Household debt management: Limited household loan growth expected, need to rebalance portfolio.

Q: Do Ha Kim on margin reversal, NIM outlook, and provision reversal amount A: Jong-Min Lee on NIM outlook (Q3 NIM 1.78%, rate down-cycle slowed, core deposit increase, focus on core deposit and funding cost; NIM impact from market rate movement in H2, gradual decline; provision reversal around KRW 70 billion due to NPL recovery) Q: ANZ on Tier 1 securities issuance in USD and NPL coverage A: Sang-Rok Na on not considering USD-denominated Tier 1 issuance due to FX and rate factors; NPL coverage around 130%, reserving discipline intact, coverage ratio may slightly increase Q: BNK Investment Securities on fines A: Sang-Rok Na on fines not finalized, actively responding, working to minimize impact on shareholder returns Q: HSBC Securities on core deposit growth, competition, and stock market money movement A: Jung-Soo Huh on core deposit increase due to interest rate fall, more salary deposits, customer numbers, and efforts to receive institutional deposits; stock market money move back and forth, impact to be seen Q: JPMorgan on productive finance, RWA, CET1, loan growth, NPL, and provisions A: Sang-Rok Na on productive finance impact on RWA, aligning with government policy; Jung-Soo Huh on loan growth targets (household 3%, corporate 6-7%, annual 5%); NPL improvement, credit cost expected in mid-40 bp range Q: JPMorgan on credit card delinquency, provisions, and capital adequacy A: Jung-Soo Huh on credit card delinquency improvement due to aggressive management, expected to continue; provisions expected in early 40% range; capital adequacy high Q: Samsung Securities on credit card delinquency, provisions, and capital adequacy A: Jung-Soo Huh on credit card delinquency improvement as ongoing; provisions in early 40% range; capital adequacy managed, considering seasonal factors in Q4 Q: Samsung Securities on dividend taxation and shareholder return A: Sang-Rok Na on considering mix of cash dividend and share buyback based on policy and taxation, not definitive yet