KB Financial Group and Shinhan Financial Group, South Korea’s top two financial holding companies, posted record quarterly results, driven by steady net interest income and a surge in fee income tied to a strong stock market. Both groups also announced steps aimed at boosting shareholder value, including share cancellations and a new value-up plan.
KB Financial said in a regulatory filing on Wednesday that its first-quarter 2026 net profit rose 11.5% from a year earlier to 1.8924 trillion won, the highest on record and above market expectations.
Net interest income totaled 3.3348 trillion won, while net fee income jumped 45.5% to 1.3593 trillion won. The share of group earnings from nonbank units rose to 43%, as affiliates posted broadly even growth.
By unit, KB Kookmin Bank earned 1.1010 trillion won in first-quarter net profit, up 7.3% from a year earlier. The group cited the fading impact of one-off provisioning booked last year, stable management of interest income and higher wealth-management fee income.
KB Securities posted net profit of 347.8 billion won, up 93.3% from a year earlier, as higher stock trading value lifted brokerage commissions and other wealth-management revenue.
Shinhan Financial also reported record quarterly results. In a filing Wednesday, it said first-quarter net profit rose 9.0% from a year earlier to 1.6226 trillion won, the highest for any quarter.
As with KB, improved securities performance sharply lifted noninterest and nonbank earnings. Noninterest income, including securities fee income and the bank’s exchange-traded fund fees and trust income, rose 26.5% to 1.1882 trillion won.
Shinhan Bank’s net profit increased 2.6% to 1.1571 trillion won, while Shinhan Investment Corp. surged 167.4% to 288.4 billion won on higher trading value amid a stronger market.
Hana Financial Group and Woori Financial Group, set to report first-quarter results on Thursday, are expected to post net profits of 1.1553 trillion won and 815.2 billion won, respectively, up 2.45% and 32.42% from a year earlier.
Following the record results, both groups unveiled shareholder-return measures.
KB Financial said it plans to cancel all treasury shares it holds, totaling about 14.26 million shares, or roughly 3.8% of shares outstanding. The move follows a recent Commercial Act revision related to mandatory cancellation of treasury shares. KB said it is the industry’s largest single share-cancellation case by value.
Although the mandatory cancellation comes with a 1 1/2-year grace period, KB said it decided to proceed immediately after the legal revision to maximize shareholder value and align with government policy.
Shinhan Financial announced a new corporate value-enhancement plan, “Shinhan Value-Up 2.0.” It centers on managing its common equity Tier 1 ratio at an appropriate level and introducing a new shareholder-return target that links return on equity and growth.
Growth will be set by the board, taking into account increases in capital and risk-weighted assets. With a target ROE of 10% and growth of 4% to 5%, Shinhan said the expected shareholder-return ratio would be 50% to 60%. The structure raises the return ratio as growth increases, effectively removing an upper limit.
Shinhan also said it will seek, starting with this year’s year-end dividend, to expand tax-free dividends and dividends per share by at least 10% annually over the next three years, and use remaining resources for share buybacks and cancellations to improve consistency and flexibility in its shareholder-return policy.
Jang Jeong-hun, executive vice president for finance at Shinhan Financial, said the plan is meaningful because it “builds a sustainable system in which the group’s growth and shareholder returns reinforce each other,” adding that the group will work to raise shareholder value through higher ROE and a predictable shareholder-return framework.
* This article has been translated by AI.
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