LS SECURITIES evaluated on the 25th that KB Financial's total shareholder return rate is expected to exceed 50% this year and is leading the strengthening of shareholder returns. The total shareholder return rate indicates how much profit a corporation returns to its shareholders through dividend payments and share repurchases from its net profit.
LS SECURITIES maintained a 'buy' investment opinion on KB Financial and increased the target stock price from 105,000 won to 140,000 won.
According to Jeon Bae-seung, a researcher at LS SECURITIES, KB Financial announced on the previous day a share buyback and cancellation plan worth 850 billion won for the second half of the year. It rolled out an additional shareholder return card on top of the previously scheduled 300 billion won for share buybacks and cancellations in the second half.
The researcher noted, "KB Financial's annual total shareholder return this year amounts to a total of 3.1 trillion won, including dividends of 1.34 trillion won and share buybacks and cancellations of 1.67 trillion won, with the expected total shareholder return rate reaching 53.2%." He continued, "The excess profit available for dividends of 190 billion won is scheduled to be partitioned and executed in early 2026 after the settlement of accounts, but even excluding this, the total shareholder return rate remains at 49.8%."
KB Financial's performance was also positive. The net profit attributable to controlling shareholders for KB Financial in the second quarter (April to June) of this year was 1.746 trillion won, exceeding market expectations. It also posted the highest performance in history for the first half.
Although the net interest margin (NIM) indicating the profitability of the bank decreased and interest income fell due to rising interest expenses, the increase in non-interest income, such as commission income surpassing 1 trillion won for the first time on a quarterly basis, contributed positively.
The researcher projected, "As the profit contribution from non-bank subsidiaries remains consistently high, KB Financial is likely to achieve the highest return on equity (ROE) level of 10% among large bank holding companies."
The researcher also stated, "KB Financial is leading the expansion of shareholder returns in the financial sector, and its position in terms of profitability creation capability is being strengthened. Recently, as the stock price rose to a price-earnings ratio (PER) of 0.8 times, it seems that shareholder return forms will change (focusing on dividends)."