KB Financial Group has achieved a groundbreaking milestone, becoming the first Korean financial holding company to surpass a market capitalization of 60 trillion won ($41.55 billion). This achievement is further highlighted by its price-to-book ratio (PBR) rising above 1, a symbolic indicator of market recognition for a banking sector historically considered undervalued.
On Wednesday, the stock closed at 164,500 won, marking a 5.79 percent increase from the previous session and elevating its market capitalization to 61.33 trillion won. The upward momentum continued on Thursday, with the stock trading at 166,000 won as of noon, after reaching an intraday high of 167,900 won.
The company’s shares have experienced a significant surge, increasing by 32.08 percent year-to-date and more than doubling from 69,300 won on April 9.
This impressive rally has propelled KB Financial’s PBR above 1, signifying that its market value now exceeds its net asset value. This level is widely regarded as a key benchmark for full asset recognition by the market, a feat that KB Financial is the only one among the four major financial holding companies to achieve. As of Thursday, Shinhan Financial’s PBR stood at 0.88, followed by 0.81 for Woori Financial and 0.79 for Hana Financial.
The company’s robust performance is attributed to strong earnings and a commitment to aggressive shareholder returns.
KB Financial reported a record net profit of over 5.8 trillion won last year, the highest among its peers in the Korean financial sector. This success was fueled by a well-balanced portfolio, anchored by its leading banking unit and supported by its insurance, securities, and credit card operations.
Total annual shareholder returns, encompassing both dividends and share buybacks, reached 3.06 trillion won, making KB Financial the first Korean financial firm to exceed the 3 trillion won mark.
“KB Financial’s PBR crossing 1 reflects structural changes in the banking sector,” stated Jo Ah-hae, a researcher at Meritz Securities. “Other financial groups are also working to lift returns on equity through cost discipline, stronger non-bank businesses and expanded shareholder returns, which could support further revaluation.”
Bank stocks, in general, have experienced a rally this year, driven by solid earnings and enhanced payout plans. Year-to-date gains for Shinhan, Hana, and Woori have all surpassed 30 percent.
silverstar
