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KB Financial posts YOY rise in Q4'17 profit

South Korea's KB Financial Group Inc. reported a year-over-year increase in profit for the quarter ended Dec. 31, 2017.

Profit attributable to shareholders jumped to 554.2 billion South Korean won from 453.9 billion won in the prior-year period. EPS climbed to 1,379 won from 1,143 won.

The S&P Capital IQ consensus GAAP EPS estimate for the quarter was 1,435.29 won, with four analysts reporting.

Net interest income for the quarter grew to 2.023 trillion won from 1.751 trillion won, while net fee and commission income amounted to 527.9 billion won, up from 476.9 billion won. The group's net interest margin for the fourth quarter clocked in at 1.98%, down from 2.02% as of Sept. 30, 2017, but up from 1.89% at the end of 2016.

The company posted a net operating profit of 847.5 billion won, compared to a net operating loss of 337.4 billion won in the year-ago period.

The group's provision for credit losses doubled year over year to 68.3 billion won from 31.5 billion won, on the back of some large write-backs.

The South Korean company's nonperforming loan ratio stood at 0.69% at the end of 2017, down from 0.77% at end-September 2017 and 0.86% at the end of 2016.

KB Financial reported a BIS capital adequacy ratio of 15.24% for the fourth quarter, down from 15.39% in the previous quarter and 15.27% in the prior-year quarter. The common equity Tier 1 ratio was 14.61% at 2017-end, down from 14.76% at Sept. 30, 2017, but up from 14.25% at the end of 2016.

For the 2017 full year, the South Korean company said profit attributable to shareholders rose 54.5% year over year in the aggregate to 3.312 trillion won from 2.144 trillion won in the prior year. EPS for the period rose to 8,293 won, from 5,588 won in 2016.

The company attributed this to improved profitability at its bank unit and the consolidation of nonbanking subsidiaries such as KB Securities Co. Ltd. and KB Insurance Co. Ltd.

Meanwhile, KB Kookmin Bank posted a fourth-quarter profit of 333.7 billion won, compared to a loss of 200.7 billion won in the prior-year period.

The bank's net interest income for the quarter increased to 1.422 trillion won from 1.299 trillion won, while net fee and commission income clocked in at 314.7 billion won, up from 268.6 billion won.

KB Kookmin's Bank's net interest margin for the quarter stood at 1.71%, down from 1.74% in the previous quarter but up from 1.61% in the 2016 fourth quarter.

As of end-December 2017, the lender's NPL ratio was 0.58%, down from 0.66% as of Sept. 30, 2017, and 0.74% at the end of 2016.

The lender reported a decline in its BIS capital adequacy ratio to 16.01% as of Dec. 31, 2017, from 16.18% three months prior and 16.32% at 2016-end. The common equity Tier 1 ratio was 14.86% at the end of 2017, compared to 15.03% at the end of September 2017 and 14.83% at the end of 2016.

Meanwhile, full-year profit at KB Kookmin Bank rose to 2.175 trillion won from 964.3 billion won in 2016.

As of Feb. 7, US$1 was equivalent to 1,082.23 South Korean won.