KB Financial Group will focus on wealth management, corporate and investment banking services, expecting synergy with its newly acquired Hyundai Securities, the group said Wednesday.

The Seoul-based group on Tuesday completed the 1.25 trillion won ($1.05 billion) purchase of the securities firm’s shares from Hyundai Merchant Marine of Hyundai Group. 


With that, KB now controls 22.6 percent of the brokerage company which ranks fourth in the local industry with 3.2 trillion won in assets.

“With Hyundai Securities under its wing, KB Financial now has the much-longed-for balance in business portfolio,” the Seoul-based group said in a press statement.

KB Financial’s mainstay has been commercial banking, with KB Kookmin Bank contributing to 64 percent of its total profits in 2015. With lending margins hitting rock bottom, the group has been trying to bolster its nonbanking businesses through mergers and acquisitions.

After winning the bid for Hyundai Securities, the group’s chairman Yoon Jong-kyoo said that he wants to grow KB into a leader in universal banking, combining the strength of the brokerage company with KB Kookmin Bank’s vast customer base, reputation and assets.

Universal banking puts retail, wholesale and investment banking services under one roof, providing customers with a multitude of financial services and products.

In 2014, KB acquired LIG Insurance, now KB Insurance, for 645 billion won and Woori Financial, now KB Capital, for 270 billion won.

“KB Financial’s acquisitions in the past two years will lead to adjustment of the group’s profitability and diversification of its revenue sources,” wrote Kim Soo-hyun, an analyst at Shinhan Financial Investment, in a research note.

To maximize the benefits, the group should raise its stake in the new subsidiaries, she added.

KB Financial plans to continue buying Hyundai Securities shares to raise its stake beyond 30 percent, the group said. By law, a financial holding company must hold more than a 30 percent stake in its listed subsidiary.

KB will take over 16.7 million treasury stocks from Hyundai Securities for 107 billion won, it said in a regulatory filing Tuesday. The transfer, due to take place on Aug. 29, would lift KB’s stake to 29.62 percent.

KB Financial has established a task force to prepare for the merger between Hyundai Securities and KB’s existing brokerage unit KB Securities, the group said.

Headed by KB Financial Holdings chief executive Kim Ok-chan, the team consists of executives of the group’s holding firm and the two securities units, including their CEOs.

By Lee Sun-young (milaya@heraldcorp.com)