The nomination of KB Financial Group Vice Chairman Yang Jong-hee as the group's next chief signals that the group is on course to bolster its non-banking business under a broader strategy of consolidating its status as Korea's top financial holding company.
Yang will be the group's first and only chairman who did not serve as the CEO of its flagship affiliate, KB Kookmin Bank, if he wins approval from the board of directors and shareholders, Nov. 20, for official appointment. He will replace outgoing Chairman Yoon Jong-kyoo.
| Yang Jong-hee, KB Financial Group vice chairman and the group's chairman nominee / Courtesy of KB Financial Group |
For instance, KB Insurance posted a net profit of 525.2 billion won in the cited period, followed by KB Securities with 249.6 billion won, KB Life Insurance with 215.7 billion won and KB Kookmin Card with 192.9 billion won.
Accordingly, KB Financial Group's net income increased 12.2 percent year-on-year in the January-June period to reach all-time high 2.99 trillion won, compared to second-ranked Shinan Financial Group's 2.6 trillion won.
Under the circumstances, Yang's unconventional career background, compared to his precursors, is not a weakness but rather makes him unique and distinguishable, according to market observers.
They noted banking groups have been under heavy criticism for reaping windfall profits at a time of high key interest rate, and subsequently, seeking to diversify their portfolios.
They also noted Yang was most noteworthy for leading KB Financial Group's acquisition of LIG Insurance, now rebranded as KB Insurance, in 2015.
He served as the inaugural CEO of KB Insurance from 2016 to 2020, boosting the firm to become the group's key business arm in a short period of time before he was appointed as its vice chairman in 2020.
KB Insurance is the group's second most profitable affiliate after KB Kookmin Bank.
“Yang certainly was behind laying the groundwork for the group to move forward in expanding non-banking businesses,” a market observer said.
| New headquarters of KB Financial Group / Courtesy of KB Financial Group |
As the group's vice chairman, Yang accompanied Chairman Yoon in exploring overseas markets aggressively. And such experience will be crucial as the group's is trying to emerge as an international market player, according to the sources.
In 2020, KB Financial Group formed a strategic alliance with The Carlyle Group, a U.S.-headquartered global investment firm, to enhance investment capability.
For KB Kookmin Bank, it acquired a 100 percent stake in Cambodia's Prasac Microfinance Institution while acquiring a major 67-percent stake in KB Bukopin.
Concerning KB Bukopin, it, however, poses a challenge to Yang's forthcoming leadership as it has struggled with an operating loss of 120 billion won in the first half of the year.