(LEAD) KB Financial's net dives 59.4 pct in Q4

(ATTN: RECASTS lead, ADDS details in para 5-11)
SEOUL, Feb. 10 (Yonhap) -- KB Financial Group Inc., South Korea's top financial
firm, said Wednesday its net profit slid 59.4 percent in the fourth quarter from
a year earlier after setting aside massive loan-loss reserves against troubled
Kumho Asiana Group and earning less interest income.

Net income stood at 17.8 billion won (US$15.3 million) in the October-December
period of last year, compared with 43.9 billion won for the same period in 2008,
KB Financial said in a regulatory filing.
Revenue also shrank 66.6 percent year-on-year to 6 trillion won, according to the
company.
Compared with three months earlier, KB Financial's bottom line was down 89.7
percent.
Shares of KB Financial ended up 1.03 percent to 48,850 won on the Seoul bourse
before the earnings were released.
KB Financial attributed the sharp contraction in fourth-quarter earnings to a
one-off factor stemming from the debt rescheduling program for Kumho Asiana and
narrowed interest income on loans.
The financial group set aside 744.1 billion won in reserves to cover any
potential deterioration of risky loans in the October-December period, 34.7
percent higher than three months earlier, according to the firm.
On Dec. 30, creditor banks including KB Financial agreed to restructure debts
held by Kumho Asiana, prompting them to raise reserves to cover the souring
loans.
As of the end of December, the group's total assets reached 316 trillion won, it
said.
Kookmin Bank, the group's flagship unit and the largest local lender, swung to a
net profit of 17.8 billion won in the fourth quarter after posting a deficit of
318.5 billion won a year earlier, KB Financial said.
The bank's net interest margin (NIM), which measures profitability from lending,
stood at 2.61 percent as of end-December, compared with 3.03 percent a year
earlier, the group said. NIM indicates the difference between interests paid out
on deposits and interest gained from lending.
The capital adequacy ratio under the rules set by the Bank for International
Settlement reached 14.1 percent as of the end of December while the group's
non-performing loans accounted for 1.1 percent of its total lending.
For the whole of 2009, the broader group's net income came to 539.8 billion won,
compared with 1.9 trillion won booked the previous year, it said.
pbr@yna.co.kr
(END)

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