Despite Crisis, 'Performance'... KB Securities, Park Jung-rim and Kim Sung-hyun Reappointed as CEOs

Expected to Continue Dual-Top System for 5th Year Since 2018
Strong Performance Across All Sectors Including WM and IB... Rapid Response to 'Lime' Crisis

Park Jung-rim (left) and Kim Sung-hyun, Co-CEOs of KB Securities (Photo by KB Securities)

[Asia Economy Reporter Minwoo Lee] KB Securities has decided to maintain the dual CEO system with Park Jeongrim and Kim Seonghyeon. Despite crises such as the private equity fund incident, the company achieved solid performance, including the prospect of reaching an operating profit of "1 trillion won," which was considered a key factor.

According to the industry on the 17th, KB Financial Group held the KB Financial Group Affiliate CEO Candidate Recommendation Committee (hereinafter referred to as the Recommendation Committee) the day before and re-nominated Park Jeongrim and Kim Seonghyeon as CEO candidates for KB Securities. The recommended candidates will be finalized at the shareholders' meeting through the final review and recommendation by the affiliate's CEO Candidate Recommendation Committee within this month.

Accordingly, the term of Park Jeongrim and Kim Seonghyeon, who have been leading KB Securities as co-CEOs for four years since 2018, is expected to be extended by one more year. Both completed a two-year term and received an additional one-year term last year.

The background for their reappointment is attributed to balanced "performance" across all sectors. KB Securities' cumulative operating profit until the third quarter of this year was 729.5 billion won, a 65% increase compared to the same period last year. At this rate, it is expected that the operating profit will reach 1 trillion won this year. The proportion of securities firms' net profit within KB Financial Group also increased from 11.77% in the third quarter of last year to 14.40% in the third quarter of this year.

In particular, they are evaluated to have achieved results across both the Wealth Management (WM) and Investment Banking (IB) sectors. In the WM sector led by CEO Park Jeongrim, the company efficiently targeted the period of direct investment boom, increasing market share in the individual stock market and focusing on overseas stocks, resulting in a continued increase in domestic and international brokerage revenue. Custody fees reached 516.1 billion won in the third quarter of this year, a 20.6% increase compared to the same period last year.

In the IB sector managed by CEO Kim Seonghyeon, KB Securities maintained an unshakable first place with a 23.5% market share in the Debt Capital Market (DCM). As of last month, KB Securities' acquisition of ESG (Environmental, Social, and Governance) bonds amounted to 2.046 trillion won, significantly ahead of competitors. They demonstrated competitiveness by handling bond issuances for LG Chem, Hyundai Steel, and Korea Credit Guarantee Fund. In the Equity Capital Market (ECM), they also showed achievements in leading large-scale rights offerings and initial public offerings (IPOs).

They responded swiftly even amid the crisis caused by Lime Asset Management's redemption suspension incident. After the incident, CEO Park significantly strengthened the review and risk management of financial products. Through organizational restructuring, the Risk Review Department was upgraded to the Risk Review Headquarters, and new specialized review departments related to IB and alternative investments were established. In terms of victim relief, they were the first in the industry to accept the compensation plan of 60-70% ratio decided by the Financial Supervisory Service's Dispute Mediation Committee. Even before damages were confirmed, they began compensation negotiations with investors who suffered losses due to the Lime fund. Although the Financial Supervisory Service's disciplinary committee issued a severe 'reprimand warning' to CEO Park, the organization was well managed, and the crisis was handled effectively, ultimately leading to strong performance.

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