Filed pursuant to Rule 424(b)(5)
Registration No. 333-160505

CALCULATION OF REGISTRATION FEE

Proposed Maximum

Proposed Maximum

Title of Each Class of

Amount to be

Offering Price

Aggregate Offering

Amount of

Securities to be Registered

Registered(1)

Per Unit

Price

Registration Fee

Common stock (par value Won 5,000 per share, which may be represented by American depositary shares)(2)

8,319,343

US$33.56(3)

US$279,197,151(3)

US$15,579.20

Rights to purchase shares of common stock (including in the form of American depositary shares)(2)(4)

8,319,343

US$0(4)

US$0(4)

US$0

PROSPECTUS SUPPLEMENT

(To prospectus dated July 10, 2009)

 

KB Financial Group Inc.

 

Rights Offering for 30,000,000 Shares of Common Stock
Directly or in the Form of American Depositary Shares

 

We are offering an aggregate of 30,000,000 new shares of our common stock, par value W5,000 per share, either directly or in the form of American depositary shares, or ADSs, each representing one share of our common stock. As required under Korean law, 6,000,000, or 20%, of the new shares of common stock were initially offered to members of our employee stock ownership association, all of which have been subscribed by such members. The remaining 24,000,000, or 80%, of the new shares of common stock are being offered by way of a rights offering, in which we are distributing (i) to holders of our ADSs, transferable rights to subscribe for new ADSs at the ADS subscription price described below, which we refer to as ADS rights, and (ii) to holders of our common stock, transferable rights to subscribe for new shares of our common stock at the share subscription price described below, which we refer to as share rights. The ADS rights and share rights are referred to collectively as the rights.

 

ADS Rights

 

If you own ADSs, you will receive 0.0776839 ADS right for every ADS you owned on July 27, 2009. Fractional ADS rights will not be distributed to you. One ADS right allows you to subscribe for one new ADS. If you decide to exercise ADS rights and subscribe for new ADSs, you must deposit US$33.56 per new ADS subscribed, which represents 110% of the indicative ADS subscription price of US$30.51 per new ADS, to account for possible exchange rate fluctuations and any currency conversion expenses. The indicative ADS subscription price is the U.S. dollar equivalent of the maximum share subscription price of W37,250 per share, based on the exchange rate of W1,220.9 per U.S. dollar. The final ADS subscription price will be the U.S. dollar equivalent of the final share subscription price determined as described below, based on the exchange rate on or about August 25, 2009 at which we can convert U.S. dollar amounts to Won amounts, plus currency conversion expenses. Any excess amount deposited will be refunded to the exercising holders of ADS rights, while any shortfall in the amount deposited must be paid by the exercising holders of ADS rights. Holders of ADS rights may exercise their ADS rights from 9:00 a.m. (New York City time) on August 7, 2009 to 5:00 p.m. (New York City time) on August 21, 2009. ADS rights that are not exercised by 5:00 p.m. (New York City time) on August 21, 2009 will lapse without compensation.

 

The ADS rights will be admitted for trading on the New York Stock Exchange under the symbol “KB RT.” Trading in the ADS rights on the New York Stock Exchange is expected to commence on August 10, 2009 and continue until August 17, 2009.

 

Share Rights

 

If you own shares of common stock, you will receive 0.0776839 share right for every share you owned on July 27, 2009. Fractional share rights will not be distributed to you. One share right allows you to subscribe for one new share of common stock. The maximum share subscription price is W37,250 per share. The final share subscription price per share will be determined on August 21, 2009 and will be the lower of (i) the maximum share subscription price and (ii) a reference price set at a discount rate of 25% to the relevant market price of our common stock. The relevant market price of our common stock will be the lower of (i) the arithmetic average of (x) the volume-weighted average closing price for the one-week period immediately preceding, and inclusive of, August 21, 2009, and (y) the closing price on August 21, 2009, and (ii) the closing price on August 21, 2009, in each case on the KRX KOSPI Market. Holders of share rights may exercise their share rights from 9:00 a.m. (Seoul time) on August 26, 2009 to 4:00 p.m. (Seoul time) on August 27, 2009. Share rights that are not exercised by 4:00 p.m. (Seoul time) on August 27, 2009 will lapse without compensation.

 

The share rights have been approved for listing on the KRX KOSPI Market under the code “J1055602W.” Trading in the share rights on the KRX KOSPI Market is expected to commence on August 10, 2009 and continue until August 17, 2009.

 

 

Our common stock is listed on the KRX KOSPI Market under the code “A105560.” On August 6, 2009, the closing price of our common stock on the KRX KOSPI Market was W55,200 per share. Our ADSs are listed on the New York Stock Exchange under the symbol “KB.” On August 6, 2009, the closing price of our ADSs on the New York Stock Exchange was US$44.59 per ADS.

 

We expect the new shares of common stock to be issued on or about September 2, 2009 and delivered on or about September 7, 2009. We expect the new ADSs to be issued and delivered on or about September 8, 2009. Listing and trading in the new shares of common stock on the KRX KOSPI Market and in the new ADSs on the New York Stock Exchange are expected to commence on or about September 4, 2009 and September 8, 2009, respectively.

 

 

Investing in our ADSs, common stock, ADS rights or share rights involves risks. See “Risk Factors” beginning on page S-28 of this prospectus supplement and page 5 of the accompanying prospectus.

 

Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

 

 

 

 

The underwriters named below have agreed to procure subscribers for, or failing which, to subscribe for, all new shares of common stock (including in the form of ADSs) that have not been subscribed for by holders of rights. If the underwriters purchase any new shares of common stock that are not subscribed for, they may resell these new shares (including in the form of ADSs) to the public at variable prices, which may be more or less than the applicable subscription price. See “Plan of Distribution” in this prospectus supplement.

 

 

The date of this prospectus supplement is August 7, 2009.

 

TABLE OF CONTENTS

 

You should rely only on the information contained or incorporated by reference in this prospectus supplement and the accompanying prospectus. “Incorporated by reference” means that we can disclose important information to you by referring you to another document filed separately with the U.S. Securities and Exchange Commission, or the SEC. Neither we nor any of the underwriters has authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference is current only as of their respective dates. Our business, financial condition, results of operations and prospects may have changed since those dates.

 

This prospectus supplement adds to and updates information contained or incorporated by reference in the accompanying prospectus. The accompanying prospectus and the documents incorporated by reference provide more general information, some of which may not apply to this offering. To the extent there is a conflict between the information contained in this prospectus supplement and the information contained or incorporated by reference in the accompanying prospectus, you should rely on the information contained in this prospectus supplement. Before purchasing any securities, you should carefully read both this prospectus supplement and the accompanying prospectus, together with the additional information described under the headings “Where You Can Find More Information” and “Incorporation of Certain Documents by Reference” in the accompanying prospectus.

 

References in this prospectus supplement and the accompanying prospectus to:

 

 

Discrepancies between totals and the sums of the amounts contained in any table may be as a result of rounding.

 

This prospectus supplement and the accompanying prospectus may contain translations of Won amounts into U.S. dollars, solely for your convenience. We do not intend to imply that the Won or U.S. dollar amounts referred to in this prospectus supplement or the accompanying prospectus could have been or could be converted into U.S. dollars or Won, as the case may be, at any particular rate, or at all.

 

Unless indicated otherwise, the financial information presented in this prospectus supplement and the accompanying prospectus has been prepared in accordance with United States generally accepted accounting principles, or U.S. GAAP.

 

This prospectus supplement and the accompanying prospectus contain forward-looking statements. See “Forward-Looking Statements” in the accompanying prospectus.

 

During the distribution of the rights, new shares of common stock and new ADSs in this offering, we, through certain of our affiliates, have engaged and intend to continue to engage in various dealing and brokerage activities

involving our common stock outside the United States. We, through our asset management subsidiary and certain identifiable business units of our subsidiaries, have purchased and sold, and intend to continue to purchase and sell, our common stock and derivatives, as part of our ordinary investing activities and/or as part of the investment selections made by our customers. We, through our securities brokerage subsidiary, have also engaged, and intend to continue to engage, in unsolicited brokerage transactions in our common stock with our customers. These activities occurred and are expected to continue to occur outside the United States on the KRX KOSPI Market and in the over-the-counter markets in Korea. There is no assurance that any or all of these activities will not have an impact on the market price of our common stock and ADSs.

 

Investors should note that the offer, sale, exercise or acceptance of, or the subscription for, any of the securities described in this prospectus supplement to or by persons located or resident in jurisdictions other than Korea and the United States may be restricted or prohibited by the laws of the relevant jurisdiction. Crediting of share rights or ADS rights to any account, the receipt of allotment of any new shares of common stock or new ADSs or of certificates evidencing such securities or the receipt of this prospectus supplement and the accompanying prospectus or the Korean prospectus or any other documents will not constitute an offer or sale in those jurisdictions in which it will be illegal to make such offer or sale, or where such offer or sale will trigger any registration, filing or approval requirement or otherwise violate the securities laws of such jurisdictions or be prohibited. We reserve absolute discretion in determining whether any holder of our ADSs or common stock located or resident outside Korea and the United States may participate in this offering.

 

Each person who receives a copy of this prospectus supplement or who exercises, accepts, subscribes for or purchases any of the securities described in this prospectus supplement must do so in accordance with the restrictions set forth below.

 

Notice to Residents of Australia

 

This document has not been lodged with the Australian Securities and Investments Commission (“ASIC”) and does not constitute a prospectus or other disclosure document under the Corporations Act 2001 (Cth) (the “Australian Corporations Act”) and does not purport to include the information required of a disclosure document under the Australian Corporations Act. The offer of any rights, new shares of common stock or new ADSs which are the subject of the offering contemplated by this document is therefore directed only to persons to whom such an offer may be made in Australia without lodging a disclosure document with ASIC. Consequently, this offering is directed only to, and the rights, new shares of common stock or new ADSs will only be issued to, investors who fall within one of the categories set out in Section 708(8) or 708(11) of the Australian Corporations Act (“Sophisticated and Professional Investors”) and who are “wholesale clients” which has the meaning given by subsection 761G(4) of the Australian Corporations Act.

 

As no formal disclosure document will be lodged with ASIC, if a person to whom the rights, new shares of common stock or new ADSs are issued (an “Investor”) on-sells the rights, new shares of common stock or new ADSs within 12 months of their issue, such Investor will be required to lodge a prospectus with ASIC unless either:

 

(1) the sale is to a Sophisticated and Professional Investor; or

 

(2) the sale offer is received outside of Australia (for example, by trading the rights on the New York Stock Exchange or the KRX KOSPI Market).

 

Each Investor acknowledges the above and, by applying for the rights, new shares of common stock or new ADSs, gives an undertaking not to sell, in any circumstances other than those described in paragraphs (1) and (2) above, for 12 months after the date of issue.

 

We are not licensed in Australia to provide financial product advice in relation to the rights, new shares of common stock or new ADSs and recommend that you read this document before making a decision to acquire any rights, new shares of common stock or new ADSs. Nothing in this document takes into account the investment objectives, financial situation and particular needs of any individual Investor.

Notice to Residents of Canada

 

Neither the rights nor any of the new shares of common stock or new ADSs issuable upon the exercise of the rights have been or will be qualified for distribution by prospectus under the securities laws of any province or territory of Canada (collectively, the “Canadian Jurisdictions”). The rights distributed by us in the rights offering to existing holders of shares of common stock or ADSs in Canada, and any new shares of common stock or ADSs sold to persons in Canada upon the exercise of the rights, will be distributed under exemptions from the prospectus and registration requirements of applicable securities laws in each of the Canadian Jurisdictions.

 

The rights and any common shares or ADSs issued upon exercise of the rights will be subject to a “hold period” under Canadian securities laws and will remain subject to restrictions on resale unless we become a reporting issuer in Canada. Accordingly, any resale of the rights or any common shares or ADSs issued upon exercise of the rights by persons in Canada must be made: (i) through an appropriately registered dealer or in accordance with an exemption from the registered dealer requirements of applicable provincial securities laws; and (ii) in accordance with, or pursuant to an exemption from, or in a transaction not subject to, the prospectus requirements of those laws. These Canadian resale restrictions may in some circumstances apply to resales made outside of Canada. Persons in Canada are advised to seek Canadian legal advice prior to any resale of rights or new shares of common stock or new ADSs obtained upon exercise of the rights.

 

Notice to Residents of the European Economic Area

 

In any Member State of the European Economic Area (“EEA”) that has implemented Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the “Prospectus Directive”), this prospectus supplement and the accompanying prospectus are only addressed to and are only directed at qualified investors in that Member State within the meaning of the Prospectus Directive.

 

This prospectus supplement and the accompanying prospectus have been prepared on the basis that any offer of the rights, new shares of common stock or new ADSs in any Member State of the EEA which has implemented the Prospectus Directive (each, a “Relevant Member State”) will be made pursuant to an exemption under the Prospectus Directive, as implemented in that Relevant Member State, from the requirement to publish a prospectus for offers of the rights, new shares of common stock or new ADSs. Accordingly any person making or intending to make any offer within the EEA of the rights, new shares of common stock or new ADSs which are the subject of the offering contemplated in this prospectus supplement and the accompanying prospectus may only do so in circumstances in which no obligation arises for us or any of the underwriters to publish a prospectus pursuant to Article 3 of the Prospectus Directive in relation to such offer. Neither we nor any of the underwriters have authorized, nor do we or any of them authorize, the making of any offer of the rights, new shares of common stock or new ADSs in circumstances in which an obligation arises for us or any of the underwriters to publish a prospectus for such offer.

 

In relation to each Relevant Member State, with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the “Relevant Implementation Date”), an offer to the public of any rights, new shares of common stock or new ADSs which are the subject of the offering contemplated by this prospectus supplement and the accompanying prospectus may not be made in that Relevant Member State, except that an offer to the public in that Relevant Member State of any rights, new shares of common stock or new ADSs may be made at any time with effect from and including the Relevant Implementation Date under the following exemptions under the Prospectus Directive, if they have been implemented in that Relevant Member State:

 

(a) to legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;

 

(b) to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts;

 

(c) to fewer than 100 natural or legal persons (other than qualified investors as defined in the Prospectus Directive) subject to obtaining the prior consent of us and the underwriters for any such offer; or

 

(d) in any other circumstances falling within Article 3(2) of the Prospectus Directive,

 

provided that no such offer of the rights, new shares of common stock or new ADSs shall require us or any underwriter to publish a prospectus pursuant to Article 3 of the Prospectus Directive.

 

This EEA selling restriction is in addition to any other selling restrictions set out in this prospectus supplement and the accompanying prospectus.

 

Each person in a Relevant Member State who receives any communication in respect of, or who acquires any rights, new shares of common stock or new ADSs under, the offering contemplated in this prospectus supplement and the accompanying prospectus will be deemed to have represented, warranted and agreed to with us and each underwriter that:

 

(a) it is a qualified investor within the meaning of the law in that Relevant Member State implementing Article 2(1)(e) of the Prospectus Directive; and

 

(b) in the case of any rights, new shares of common stock or new ADSs acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, (i) the rights, new shares of common stock or new ADSs acquired by it in this offering have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than qualified investors, as that term is defined in the Prospectus Directive, or in circumstances in which the prior consent of us and the underwriters has been given to the offer or resale; or (ii) where the rights, new shares of common stock or new ADSs have been acquired by it on behalf of persons in any Relevant Member State other than qualified investors, the offer of those rights, new shares of common stock or new ADSs to it is not treated under the Prospectus Directive as having been made to such persons.

 

For the purposes of this section, the expression an “offer to the public” or an “offer” in relation to any rights, new shares of common stock or new ADSs in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and any rights, new shares of common stock or new ADSs to be offered so as to enable an investor to decide to purchase any rights, new shares of common stock or new ADSs, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State.

 

Notice to Residents of Hong Kong

 

Warning: The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in any doubt about any of the contents of this document, you should obtain independent professional advice.

 

We have not been authorized, nor has this document been approved, by the Hong Kong Securities and Futures Commission. Accordingly, no rights, new shares of common stock or new ADSs may be offered or sold in Hong Kong by means of this document, and no person may issue or have in its possession for the purposes of issue, whether in Hong Kong or elsewhere, this document or any other advertisement, invitation or document relating to the rights, new shares of common stock or new ADSs which is directed at, or the contents of which are or are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to rights, new shares of common stock or new ADSs which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of Section 1 of Part 1 of Schedule 1 to the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made thereunder.

 

Notice to Residents of Singapore

 

This prospectus supplement and the accompanying prospectus have not been and will not be registered as a prospectus with the Monetary Authority of Singapore. This offering does not constitute a public offering of securities in Singapore pursuant to Section 273 (1)(cd)(i) of the Securities and Futures Act, Chapter 289 of the Singapore Statutes.

Notice to Residents of the United Kingdom

 

This prospectus supplement and the accompanying prospectus are only being distributed to and are only directed at (i) persons who are outside the United Kingdom, (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). The rights, new shares of common stock or new ADSs are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such rights, new shares of common stock or new ADSs will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

 

Persons in the United Kingdom will not be permitted to subscribe for new shares of common stock or new ADSs by exercising the rights unless they are:

 

(A) (i) a legal entity which is authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities; (ii) a legal entity which has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts; or (iii) otherwise a “qualified investor” as defined by the Financial Services and Markets Act 2000; and

 

(B) an investment professional falling within Article 19(5) of the Order or a high net worth entity falling within Article 49(2)(a) to (d) of the Order;

 

(a “UK Professional Investor”). Persons in the United Kingdom with an interest in the rights will be deemed (upon exercise of any rights) to have represented and warranted, and any such persons completing a subscription form will be deemed to represent and warrant, to us that they are UK Professional Investors. Any person acting directly or indirectly on behalf of a person with an interest in the rights in the United Kingdom will be deemed (upon delivering any communication exercising the rights) to have represented and warranted to us that it has reasonably determined that the person on behalf of whom it is acting is a UK Professional Investor.

 

Notice to Residents of Japan and the People’s Republic Of China

 

Due to restrictions under and the requirements of the securities laws of Japan and the People’s Republic of China (not including Taiwan and the special administrative regions of Hong Kong and Macau), the rights, the new shares of common stock and the new ADSs are not being offered or sold and may not be offered or sold, and this prospectus supplement and the accompanying prospectus may not be circulated or distributed, directly or indirectly, in these jurisdictions. Persons located in or who are resident of these jurisdictions will not be permitted to acquire, directly or indirectly, any rights, new shares of common stock or new ADSs in this offering.

 

Notice to Residents of Other Jurisdictions Outside Korea, Canada and the United States

 

The distribution of this prospectus supplement and the accompanying prospectus, and the offer, sale, exercise of, or subscription for, the rights, the new shares of common stock and the new ADSs may be restricted by law in certain jurisdictions, and therefore persons into whose possession these documents come should inform themselves about and observe any such restrictions. No rights, new shares of common stock or new ADSs may be allocated, offered for sale or purchase, or be sold or delivered in any jurisdiction where to do so would violate any securities laws or regulations in any such jurisdiction or give rise to an obligation to obtain any consent, approval or permission, or to make any application, filing or registration, in any such jurisdiction (other than Korea, Canada and the United States). Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions.

 

SUMMARY

Issuer		KB Financial Group Inc., a corporation with limited liability established under the laws of Korea.
New shares of common stock and ADSs being offered		We are offering an aggregate of 30,000,000 new shares of common stock, par value W5,000 per share, either directly or in the form of ADSs.
		As of July 27, 2009, we had 356,351,693 shares of common stock issued and 308,944,022 shares of common stock outstanding. This offering will result in the issuance of 30,000,000 new shares of common stock, or approximately 8.4% of the total common stock issued as of July 27, 2009. Following this offering, the number of shares of common stock issued will increase to 386,351,693 and the number of shares of common stock outstanding will increase to 338,944,022.
Allocation of rights		As required under Korean law, 6,000,000, or 20%, of the new shares of common stock were initially offered to members of our employee stock ownership association, all of which have been subscribed by such members. The remaining 24,000,000, or 80%, of the new shares of common stock are being offered by way of a rights offering to holders of our common stock and ADSs. We are distributing (i) to holders of our ADSs, transferable rights to subscribe for new ADSs at the ADS subscription price described below and (ii) to holders of our common stock, transferable rights to subscribe for new shares of our common stock at the share subscription price described below. No rights will be issued with respect to 47,407,671 shares of our common stock held by Kookmin Bank, our wholly-owned subsidiary.
Reasons for this offering and use of proceeds		Assuming a share subscription price of W37,250 per share, which represents the maximum share subscription price per share, we estimate that the aggregate net proceeds from the sale of 30,000,000 new shares of common stock (directly or in the form of ADSs) by us in this offering will be approximately W1,105.2 billion (net of underwriting, management and selling fees and other offering expenses). We intend to use the net proceeds from this offering for general corporate purposes, including to fund potential acquisitions in the banking, securities and/or insurance industries, and to strengthen our capital base. We currently do not have any specific plans for such acquisitions. See “Reasons for This Offering and Use of Proceeds.”
Risk factors		Investing in our ADSs, common stock, ADS rights or share rights involves risks. See “Risk Factors” in this prospectus supplement and in the accompanying prospectus.
Dilution		If you do not exercise your ADS rights or share rights, as applicable, your percentage ownership interest in us will be diluted. See “Dilution.”
Underwriting		The underwriters have agreed, severally and not jointly, to procure subscribers for, or failing which, to subscribe for, all new shares of

		common stock (including in the form of ADSs) that have not been subscribed for by holders of rights. We have agreed to pay the joint lead managers and underwriters underwriting, management and selling fees equal to 0.6% of the final share subscription price multiplied by the total number of new shares of common stock (including in the form of ADSs) issued in this offering and not otherwise excluded as described in “Plan of Distribution.” These underwriting arrangements are subject to customary conditions.
Standby purchase commitment		Certain of the underwriters have entered into a separate standby purchase agreement with ING Bank N.V., which held approximately 5.05% of our total issued shares of common stock as of July 27, 2009, pursuant to which it has agreed to purchase at the final share subscription price up to 1,100,000 new shares of our common stock that have not been subscribed for by holders of rights, representing approximately 3.7% of the total number of new shares of our common stock being offered for subscription in this offering. Certain of the underwriters have entered into separate agreements with third parties (in addition to ING Bank N.V.) to act as standby purchasers, pursuant to which such standby purchasers have agreed to purchase a portion of the new shares of our common stock underwritten by such underwriters. Such underwriters have agreed to pay a fee to the standby purchasers for each such standby purchase commitment, including to ING Bank N.V. See “Plan of Distribution — Standby Purchase Commitment.”
Lock-up		We have agreed that we will not, and will procure that Kookmin Bank will not, during the period beginning from the date of the underwriting agreement and continuing to and including the date 180 days after our receipt of the subscription monies for the new shares of common stock, without the prior written consent of the underwriters (such consent not to be unreasonably withheld), offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale or dispose of any shares of our common stock or any substantially similar securities, subject to certain exceptions as described in “Plan of Distribution.”

ADS rights offering		Each holder of our ADSs will receive 0.0776839 ADS right for every ADS it held on the ADS record date identified below. Each ADS right entitles the holder thereof to subscribe for one new ADS at the ADS subscription price described below. Citibank, N.A., as the depositary under our American depositary receipt program, will charge holders of ADSs a fee of US$0.02 per ADS held for the distribution of the ADS rights.
ADS record date		5:00 p.m. on July 27, 2009 (New York City time).
Fractional ADS rights		If, on the ADS record date, you held a number of ADSs that would entitle you to receive a number of ADS rights other than a whole number, your entitlement to ADS rights will be rounded down to the nearest whole number and you will receive such whole number of ADS rights, if any. Fractional ADS rights will not be distributed to you but will be aggregated with fractional ADS rights of other holders of ADSs and sold by the ADS rights agent. The net proceeds from the

		sale of your fractional ADS rights (after deducting applicable fees of up to US$0.02 for every ADS right sold, as well as taxes and expenses) will be remitted to you.
ADS ex-rights date		July 24, 2009. If you purchased ADSs on or after July 24, 2009, or if you sold ADSs on or before July 23, 2009, you will not receive ADS rights for such ADSs.
ADS subscription period		From 9:00 a.m. (New York City time) on August 7, 2009 to 5:00 p.m. (New York City time) on August 21, 2009.
Indicative ADS subscription price and ADS deposit amount		The indicative ADS subscription price is US$30.51 per new ADS subscribed. The indicative ADS subscription price is the U.S. dollar equivalent of the maximum share subscription price of W37,250 per share, based on the exchange rate of W1,220.9 per U.S. dollar, which was the market average exchange rate, as announced by Seoul Money Brokerage Services, Ltd., in effect on August 6, 2009.
		A holder of ADS rights exercising such rights and subscribing for new ADSs must deposit US$33.56, or the ADS deposit amount, per new ADS subscribed, which represents 110% of the indicative ADS subscription price, to account for possible exchange rate fluctuations and any currency conversion expenses.
Final ADS subscription price		The final ADS subscription price will be the U.S. dollar equivalent of the final share subscription price determined as described below under “— Offering to Holders of Common Stock — Final Share Subscription Price,” based on the exchange rate on or about August 25, 2009 at which we can convert U.S. dollar amounts to Won amounts, plus currency conversion expenses. Any excess of the ADS deposit amount over the final ADS subscription price for the new ADSs being subscribed will be refunded to the exercising holders of ADS rights, while any shortfall in the ADS deposit amount over the final ADS subscription price for the new ADSs being subscribed must be paid by the exercising holders of ADS rights.
ADS subscription procedure		Each holder of ADS rights may exercise all or only a portion of its ADS rights. The exercise of ADS rights is irrevocable. Subscriptions for new ADSs must be received by the ADS rights agent identified below prior to 5:00 p.m. (New York City time) on August 21, 2009.
		A holder who holds ADS rights through a financial intermediary and who wishes to exercise its ADS rights should consult with the financial intermediary as to the manner, timing and form of exercise documentation, method of payment of the ADS deposit amount and other related matters required to effect such exercise. The financial intermediary through whom the subscription is made may require any person exercising ADS rights to pay or block the ADS deposit amount for the new ADSs being subscribed in a deposit account as a condition to accepting the relevant subscription. You are urged to consult your financial intermediary without delay in case your financial intermediary is unable to act immediately.
		See “The Rights Offering — Offering to Holders of ADSs — ADS Subscription Procedure” and “— Payment of ADS Subscription Price” for further details on how to exercise your ADS rights.

Unexercised ADS rights		ADS rights that are not exercised by 5:00 p.m. (New York City time) on August 21, 2009 will lapse without compensation. Holders of ADSs who transfer or do not exercise their ADS rights will have their percentage ownership interest in us diluted.
Conversion of ADS rights		ADS rights may not be converted into share rights and share rights may not be converted into ADS rights.
Listing of ADS rights		The ADS rights will be admitted for trading on the New York Stock Exchange under the symbol “KB RT.” The CUSIP number for the ADS rights is “48241A 113.” Trading in the ADS rights on the New York Stock Exchange is expected to commence on August 10, 2009 and continue until August 17, 2009.
Sale of ADS rights through the ADS rights agent		Holders of ADS rights in certificated form who wish to sell their ADS rights, as well as other holders of ADS rights who wish to sell all or a portion of their ADS rights through the ADS rights agent, must instruct the ADS rights agent to do so before 5:00 p.m. (New York City time) on August 14, 2009. The ADS rights agent will collect the proceeds from all such sales and will distribute the net sales proceeds (after deducting applicable fees of up to US$0.02 per ADS right sold, as well as taxes and expenses) to the relevant ADS rights holders after the expiration of the ADS subscription period. See “The Rights Offering — Offering to Holders of ADSs — Sale of ADS Rights through the ADS Rights Agent” for further details on how to instruct the ADS rights agent to sell ADS rights.
Issuance and delivery of new ADSs		We expect the new ADSs issuable upon exercise of the ADS rights to be issued and delivered on or about September 8, 2009.
Listing of new ADSs		We expect the new ADSs to commence trading on the New York Stock Exchange on or about September 8, 2009 under the symbol “KB.”
ADS rights agent		Citibank, N.A.
ADS holder helpline		+1 (800) 308-7887 (Monday to Friday 9:00 a.m. to 5:00 p.m., New York City time)

Share rights offering		Each holder of our common stock will receive 0.0776839 share right for every share of common stock it held on the share record date identified below. Each share right entitles the holder thereof to subscribe for one new share at the share subscription price described below.
Share record date		5:00 p.m. on July 27, 2009 (Seoul time).
Fractional share rights		If, on the share record date, you held a number of shares of common stock that would entitle you to receive a number of share rights other than a whole number, your entitlement to share rights will be rounded down to the nearest whole number and you will receive such whole number of share rights, if any. Fractional share rights will not be distributed to you.

Share ex-rights date		July 24, 2009. If you purchased shares of our common stock on or after July 24, 2009, or if you sold shares of our common stock on or before July 23, 2009, you will not receive share rights for such shares.
Share subscription period		From 9:00 a.m. (Seoul time) on August 26, 2009 to 4:00 p.m. (Seoul time) on August 27, 2009.
Maximum share subscription price		W37,250 per share.
Final share subscription price		The final share subscription price per share will be determined on August 21, 2009 and will be the lower of (i) the maximum share subscription price and (ii) a reference price set at a discount rate of 25% to the relevant market price of our common stock. The relevant market price of our common stock will be the lower of (i) the arithmetic average of (x) the volume-weighted average closing price for the one-week period immediately preceding, and inclusive of, August 21, 2009, and (y) the closing price on August 21, 2009, and (ii) the closing price on August 21, 2009, in each case on the KRX KOSPI Market. The final share subscription price may not be lower than W5,000 per share.
Share subscription procedure		Each holder of share rights may exercise all or only a portion of its share rights. The exercise of share rights is irrevocable. Subscriptions for new shares must be received by Korea Investment & Securities Co., Ltd., prior to 4:00 p.m. (Seoul time) on August 27, 2009.
		The exercise of share rights requires the delivery of a properly completed subscription form and full payment of the share subscription price for the new shares of common stock being subscribed to the main or a branch office of Korea Investment & Securities located in Korea. A holder who holds share rights through a financial intermediary and who wishes to exercise its share rights should consult with the financial intermediary as to the manner, timing and form of exercise documentation, method of payment of the share subscription price and other related matters required to effect such exercise. The financial intermediary with whom the subscription is made may require any person exercising share rights to pay or block the share subscription price for the new shares being subscribed in a deposit account as a condition to accepting the relevant subscription. You are urged to consult your financial intermediary without delay in case your financial intermediary is unable to act immediately.
		See “The Rights Offering — Offering to Holders of Common Stock — Share Subscription Procedure” for further details on how to exercise share rights.
Unexercised share rights		Share rights that are not exercised by 4:00 p.m. (Seoul time) on August 27, 2009 will lapse without compensation. Holders of common stock who transfer or do not exercise their share rights will have their percentage ownership interest in us diluted.
Conversion of share rights		Share rights may not be converted into ADS rights and ADS rights may not be converted into share rights.
Listing of share rights		The share rights have been approved for listing on the KRX KOSPI Market. Trading in the share rights on the KRX KOSPI Market is

		expected to commence on August 10, 2009 and continue until August 17, 2009.
Issuance and delivery of new shares		We expect the new shares of common stock issuable upon exercise of the share rights to be issued on or about September 2, 2009 and the share certificates for the new shares of common stock to be delivered on or about September 7, 2009.
Listing of new shares		We expect the new shares of common stock to commence trading on the KRX KOSPI Market on or about September 4, 2009 under the code “A105560.”

ADS Rights		2009 (New York City Time)
ADSs trade ex-rights		July 24
Record date for allocation of ADS rights		5:00 p.m. on July 27
Distribution of ADS rights certificates to registered ADS holders		On or about August 7
ADS subscription period commences		9:00 a.m. on August 7
Trading in ADS rights on the New York Stock Exchange commences		9:30 a.m. on August 10
Last date and time for instructing the ADS rights agent to sell ADS rights		5:00 p.m. on August 14
Last date and time for trading in ADS rights on the New York Stock Exchange		4:00 p.m. on August 17
Last date and time to exercise ADS rights and subscribe for new ADSs		5:00 p.m. on August 21
Determination and announcement of the final ADS subscription price		On or about August 25
Issuance and delivery of new ADSs		On or about September 8
Commencement of trading in new ADSs on the New York Stock Exchange		On or about September 8

Share Rights		2009 (Seoul Time)
Shares of common stock trade ex-rights		July 24
Record date for allocation of share rights		5:00 p.m. on July 27
Share subscription date for members of our employee stock ownership association		August 3
Mailing of new share allocation notices to stockholders		August 7
Trading in share rights on the KRX KOSPI Market commences		9:00 a.m. on August 10
Last date and time for trading in share rights on the KRX KOSPI Market		3:00 p.m. on August 17
Distribution of Korean prospectus to non-U.S. stockholders		On or about August 18
Determination of the final share subscription price		August 21
Announcement of the final share subscription price		August 22
Share subscription period commences		9:00 a.m. on August 26
Last date and time to exercise share rights and subscribe for new shares		4:00 p.m. on August 27
Allocation of unsubscribed new shares (if any)		August 28
Issuance of new shares of common stock		On or about September 2
Commencement of trading in new shares of common stock on the KRX KOSPI Market		On or about September 4
Delivery of share certificates for new shares of common stock		On or about September 7

 

SUMMARY FINANCIAL INFORMATION

		Year Ended December 31,
		2004				2005				2006				2007				2008				2008(1)
		(In billions of Won, except common share data)																				(In millions of US$,
																						except common
																						share data)
Interest and dividend income		W	12,092			W	10,658			W	11,405			W	12,792			W	15,829			US$	12,542
Interest expense			5,516				4,757				5,342				6,687				9,360				7,417
Net interest income			6,576				5,901				6,063				6,105				6,469				5,125
Provision for credit losses			3,861				613				(100	)			18				2,313				1,833
Non-interest income			2,800				2,844				2,880				4,013				2,952				2,339
Non-interest expense			4,032				4,314				4,522				5,135				5,321				4,215
Income tax expense (benefit)			448				1,099				1,423				1,206				454				359
Minority interests			3				3				5				4				7				6
Net income (loss) from continuing operations			1,032				2,716				3,093				3,755				1,326				1,051
Cumulative effect of accounting change, net of tax			—				—				(2	)			—				—				—
Net income		W	1,032			W	2,716			W	3,091			W	3,755			W	1,326			US$	1,051

		Year Ended December 31,
		2004				2005				2006				2007				2008				2008(1)
		(In billions of Won, except common share data)																				(In millions of US$,
																						except common
																						share data)
Net income from continuing operations per common share
Net income — basic		W	3,367			W	8,415			W	9,194			W	11,164			W	4,121			US$	3.27
Net income — diluted(2)			3,365				8,411				9,193				11,164				4,121				3.27
Net income per common share
Net income — basic		W	3,367			W	8,415			W	9,189			W	11,164			W	4,121			US$	3.27
Net income — diluted(2)			3,365				8,411				9,188				11,164				4,121				3.27
Weighted average common shares outstanding — basic (in thousands of common shares)			306,432				322,786				336,351				336,346				321,727				321,727
Weighted average common shares outstanding — diluted (in thousands of common shares)			306,650				322,948				336,353				336,346				321,727				321,727
Cash dividends declared per common share(3)		W	—			W	550			W	550			W	3,650			W	2,450			US$	1.94

(1)		Won amounts are expressed in U.S. dollars at the rate of W1,262.0 to US$1.00, the noon buying rate in effect on December 31, 2008 as quoted by the Federal Reserve Bank of New York in the United States.
(2)		Diluted earnings per share gives effect to the potential dilution that could occur if convertible securities, options or other contracts to issue common stock were converted into or exercised for common stock for the relevant periods. Effective from 2003, we had one category of potentially dilutive common shares, which was shares issuable on exercise of stock options granted to directors, executive officers and employees. Effective from August 2005, we changed the settlement method for such stock options to a cash settlement method (excluding certain outstanding stock options which were exercised in full in 2006), and accordingly there were no potentially dilutive common shares in 2007 and 2008.
(3)		U.S. GAAP requires that dividends be recorded in the period in which they are declared rather than the period to which they relate unless these are the same.

		As of December 31,
		2004				2005				2006				2007				2008				2008(1)
		(In billions of Won)																				(In millions of
																						US$)
Assets
Cash and cash equivalents		W	2,818			W	3,086			W	3,775			W	2,770			W	3,073			US$	2,435
Restricted cash			1,822				2,259				3,277				3,996				4,794				3,799
Interest-bearing deposits in other banks			597				515				423				69				235				186
Call loans and securities purchased under resale agreements			2,993				1,716				1,738				1,628				1,407				1,115
Trading assets			6,096				4,754				3,744				6,594				13,095				10,377
Investments(2)			23,095				25,372				25,348				24,685				29,209				23,145
Loans (net of allowance for loan losses of W4,461 billion in 2004, W3,212 billion in 2005, W2,468 billion in 2006, W1,864 billion in 2007 and W3,043 billion in 2008)			133,794				134,939				149,216				170,721				197,067				156,154
Due from customers on acceptances			743				627				620				1,106				2,063				1,635
Premises and equipment, net			1,637				1,516				1,612				1,660				1,775				1,407
Accrued interest and dividends receivable			871				1,060				802				899				1,124				891
Security deposits			1,285				1,185				1,190				1,335				1,428				1,131
Goodwill			422				394				394				394				578				458
Other intangible assets, net			308				217				185				183				208				165
Other assets			1,055				868				654				1,643				2,271				1,799
Total assets		W	177,536			W	178,508			W	192,978			W	217,683			W	258,327			US$	204,697
Liabilities and Stockholders’ Equity
Deposits:
Interest bearing		W	123,203			W	121,787			W	125,195			W	134,760			W	155,263			US$	123,030
Non-interest bearing			3,017				3,912				4,345				3,678				3,438				2,724
Call money			652				1,253				168				794				3,444				2,729
Trading liabilities			2,297				1,078				1,223				1,812				8,191				6,491
Acceptances outstanding			743				627				620				1,106				2,063				1,634
Other borrowed funds			9,514				6,118				10,627				7,776				10,527				8,341
Accrued interest payable			3,495				3,307				3,698				4,196				4,961				3,932
Secured borrowings			6,121				8,118				7,463				6,315				5,880				4,659
Long-term debt			17,899				16,751				21,675				36,307				45,148				35,775
Other liabilities			2,900				4,151				3,174				3,953				3,817				3,025
Total liabilities			169,841				167,102				178,188				200,697				242,732				192,340
Minority interests			13				14				18				20				—				—
Common stock			1,682				1,682				1,682				1,682				1,782				1,412
Additional paid-in capital			5,400				5,416				5,404				5,405				6,253				4,955
Other			600				4,294				7,686				9,879				7,560				5,990
Stockholders’ equity			7,682				11,392				14,772				16,966				15,595				12,357
Total liabilities, minority interests and stockholders’ equity		W	177,536			W	178,508			W	192,978			W	217,683			W	258,327			US$	204,697

(1)		Won amounts are expressed in U.S. dollars at the rate of W1,262.0 to US$1.00, the noon buying rate in effect on December 31, 2008 as quoted by the Federal Reserve Bank of New York in the United States.
(2)		Consists of available-for-sale securities, held-to-maturity securities, venture capital securities and other securities.

		Year Ended December 31,
		2004				2005				2006				2007				2008
						(Percentages)
Net income as a percentage of:
Average total assets(1)			0.56	%			1.50	%			1.61	%			1.80	%			0.54	%
Average stockholders’ equity(1)			13.36				25.51				22.52				22.66				7.79
Dividend payout ratio(2)			16.33				6.81				39.73				21.95				—
Net interest spread(3)			3.62				3.29				3.15				2.84				2.48
Net interest margin(4)			3.84				3.53				3.43				3.17				2.83
Efficiency ratio(5)			43.00				49.33				50.56				50.75				56.48
Cost-to-average assets ratio(6)			2.19				2.38				2.36				2.46				2.18
Won loans (gross) as a percentage of Won deposits			108.00				106.34				112.16				119.48				120.50
Total loans (gross) as a percentage of total deposits			109.43				109.80				116.88				124.38				125.79

(1)		Average balances are based on daily balances for our primary banking operations and monthly or quarterly balances for our other operations.
(2)		Represents the ratio of total dividends declared on common stock as a percentage of net income.
(3)		Represents the difference between the yield on average interest earning assets and cost of average interest bearing liabilities.
(4)		Represents the ratio of net interest income to average interest earning assets.
(5)		Represents the ratio of non-interest expense to the sum of net interest income and non-interest income.
(6)		Represents the ratio of non-interest expense to average total assets.

		As of December 31,
		2004				2005				2006				2007				2008
		(In billions of Won, except percentages)
Total loans		W	138,124			W	138,012			W	151,403			W	172,189			W	199,637
Total non-performing loans(1)			3,175				3,149				2,143				1,339				1,068
Other impaired loans not included in non-performing loans			2,034				1,615				1,195				887				2,636
Total of non-performing loans and other impaired loans			5,209				4,764				3,338				2,226				3,704
Total allowance for loan losses			4,461				3,212				2,468				1,864				3,043
Non-performing loans as a percentage of total loans			2.30	%			2.28	%			1.42	%			0.78	%			0.53	%
Non-performing loans as a percentage of total assets			1.79				1.76				1.11				0.62				0.41
Total of non-performing loans and other impaired loans as a percentage of total loans			3.77				3.45				2.21				1.29				1.86
Allowance for loan losses as a percentage of total loans			3.23				2.33				1.63				1.08				1.52

(1)		Non-performing loans are defined as those loans, including corporate, retail and other loans, which are past due more than 90 days.

																										Year Ended
		Year Ended December 31,																Six Months Ended								December 31,
																		June 30,				December 31,
		2004				2005				2006				2007				2008				2008				2008(1)				2008(2)
		(In billions of Won, except per common share data)																												(In millions
																														of US$, except
																														per common
																														share data)
Interest income(3)		W	12,284			W	11,453			W	12,267			W	13,877			W	7,938			W	8,978			W	16,916			US$	13,404
Interest expense			5,541				4,731				5,392				6,798				4,409				5,101				9,510				7,536
Net interest income			6,743				6,722				6,875				7,079				3,529				3,877				7,406				5,868
Provision for possible loan losses			3,065				1,029				1,028				547				412				1,415				1,827				1,448
Net interest income after provision for possible loan losses			3,678				5,693				5,847				6,532				3,117				2,462				5,579				4,420
Non-interest revenue(3)(4)(7)			8,547				6,834				8,052				8,277				8,028				20,751				28,779				22,805
Non-interest expense(5)(7)			10,546				9,438				10,649				10,529				9,430				22,586				32,016				25,369
Operating income			1,679				3,089				3,250				4,280				1,715				627				2,342				1,856
Non-operating (loss) income, net(7)			(1,056	)			170				174				264				62				312				374				296

																										Year Ended
		Year Ended December 31,																Six Months Ended								December 31,
																		June 30,				December 31,
		2004				2005				2006				2007				2008				2008				2008(1)				2008(2)
		(In billions of Won, except per common share data)																												(In millions
																														of US$, except
																														per common
																														share data)
Net income before income tax expense		W	623			W	3,259			W	3,424			W	4,544			W	1,777			W	939			W	2,716			US$	2,152
Income tax expense(7)			264				1,006				957				1,782				513				329				842				667
Net income before acquisition of subsidiary			—				—				—				—				1				0				1				1
Net income(8)		W	359			W	2,253			W	2,467			W	2,762			W	1,263			W	610			W	1,873			US$	1,484
Controlling company interests		W	356			W	2,241			W	2,458			W	2,757			W	1,261			W	612			W	1,873			US$	1,484
Minority interests			3				12				9				5				2				(2	)			—				—
Per common share data:
Earnings per share — basic			1,162				6,943				7,308				8,197				3,750				2,134				5,884				4.7
Earnings per share — diluted			1,161				6,938				7,308				8,179				3,746				2,134				5,880				4.7
Cash dividends per common share(6)			550				550				3,650				2,450				—				—				—				—

(1)		Figures shown in the above table for the year ended December 31, 2008 represent (i) the consolidated income statement data of Kookmin Bank for the period between January 1, 2008 and June 30, 2008 (for which consolidated net income was W1,263 billion under Korean GAAP), and (ii) our consolidated income statement data for the period between September 29, 2008 and December 31, 2008 (for which consolidated net income was W610 billion under Korean GAAP), which includes the results of Kookmin Bank and its subsidiaries from July 1, 2008 to September 28, 2008 because the acquisition cost of Kookmin Bank and its subsidiaries in connection with the comprehensive stock transfer pursuant to which we were established has been determined as the net asset amount of Kookmin Bank and its subsidiaries as of June 30, 2008 based on Korean GAAP.
(2)		Won amounts are expressed in U.S. dollars at the rate of W1,262.0 to US$1.00, the noon buying rate in effect on December 31, 2008 as quoted by the Federal Reserve Bank of New York in the United States.
(3)		Commencing with the year ended December 31, 2005, certain income items relating to our credit card operations (including merchant fees on credit card purchases and interest on credit card installment purchases) have been reclassified from non-interest income to interest income. Corresponding amounts for 2004 have been restated to reflect such reclassification.
(4)		Non-interest revenue includes fees and commission income, dividends on securities, gains on security valuations and disposals, gains on foreign currency transactions and gains from derivative transactions.
(5)		Non-interest expense is composed of fees and commissions paid or payable, general and administrative expenses, losses on security valuations and disposals, losses on foreign currency transactions and losses from derivative transactions.
(6)		Ratios represent the periods to which the dividends relate.
(7)		Commencing with the year ended December 31, 2007, we reclassified a number of line items in our income statement, including gains or losses on disposal of available-for-sale securities and sale of loans, which have been reclassified from non-operating (loss) income to non-interest (expense) revenue, and refund of a prior year’s income tax and additional income tax paid for a prior year, which have been reclassified from non-operating (loss) income to income tax (benefit) expense. Certain income statement amounts for 2006 have been restated to reflect such reclassification.

(8)		Commencing with the year ended December 31, 2007, net income is presented as the sum of controlling company interests and minority interests. In prior years, controlling company interests were presented as net income. Corresponding amounts for 2004, 2005 and 2006 have been restated to reflect such change.

		As of December 31,
		2004				2005				2006				2007				2008				2008(1)
		(In billions of Won)																				(In millions
																						of US$)
Cash and cash equivalents		W	5,213			W	5,943			W	6,689			W	6,727			W	8,316			US$	6,590
Foreign exchange(2)			—				—				—				—				—				—
Loans(3)(4)(5)			138,969				138,281				152,383				174,235				202,407				160,386
Less: allowance for doubtful accounts			(3,131	)			(2,459	)			(2,365	)			(2,505	)			(3,477	)			(2,756	)
Trading securities(6)			6,523				6,463				5,552				7,786				7,644				6,057
Investment securities(6)			24,147				27,016				27,036				26,454				31,342				24,835
Premises and equipment, net			2,637				2,442				2,513				2,640				3,915				3,103
Other assets(7)(8)			8,331				5,217				7,105				7,707				17,402				13,789
Total assets		W	182,689			W	182,903			W	198,913			W	223,044			W	267,549			US$	212,004
Deposits		W	130,134			W	129,616			W	133,297			W	142,101			W	162,210			US$	128,534
Borrowings(9)(10)			9,359				13,328				13,804				15,275				20,390				16,156
Debentures			21,875				16,548				24,983				34,895				43,106				34,157
Other liabilities(11)			12,059				10,960				11,701				14,666				25,781				20,429
Total liabilities			173,427				170,452				183,785				206,937				251,487				199,276
Stockholders’ equity(12)			9,262				12,451				15,128				16,107				16,062				12,728
Total liabilities, minority interests and stockholders’ equity		W	182,689			W	182,903			W	198,913			W	223,044			W	267,549			US$	212,004

(1)		Won amounts are expressed in U.S. dollars at the rate of W1,262.0 to US$1.00, the noon buying rate in effect on December 31, 2008 as quoted by the Federal Reserve Bank of New York in the United States.
(2)		Foreign exchange represents holdings of foreign currency and bills bought in foreign currencies and are included in cash and cash equivalents and loans, respectively. The amounts of foreign currency and bills bought in foreign currencies as of December 31, 2004 were W125 billion and W575 billion, respectively. As of December 31, 2005, the amounts were W150 billion and W1,378 billion, respectively. As of December 31, 2006, the amounts were W151 billion and W1,274 billion, respectively. As of December 31, 2007, the amounts were W189 billion and W1,628 billion, respectively. As of December 31, 2008, the amounts were W273 billion and W2,754 billion, respectively.
(3)		Loans represent the gross amount of loans, before adjustment for the allowance for loan losses. Accrued interest income is included within other assets.
(4)		Credit card assets are included in loans. The amount of credit card assets was W7,644 billion, W7,571 billion, W8,667 billion, W10,436 billion and W11,526 billion as of December 31, 2004, 2005, 2006, 2007 and 2008, respectively.
(5)		Call loans are included in loans. The amounts of call loans at December 31, 2004, 2005, 2006, 2007 and 2008 were W2,824 billion, W1,535 billion, W1,189 billion, W1,621 billion and W158 billion, respectively.
(6)		Under Korean GAAP, all debt securities and marketable equity securities are accounted for on a similar basis to U.S. GAAP. However, adjustments for impairment can be reversed up to the original cost of the investment.

(7)		Guarantees and acceptances for which the amounts were determined do not appear on the balance sheet but are recorded as an off-balance sheet item in the notes to our consolidated financial statements. The amounts of guarantees and acceptances at December 31, 2004, 2005, 2006, 2007 and 2008 were W976 billion, W1,790 billion, W2,715 billion, W5,300 billion and W9,107 billion, respectively.
(8)		Other assets include leasehold deposits, accounts receivables, accrued interest income, prepaid expenses and unsettled debit of domestic exchange (which represents outstanding balances due from other banks generated in the process of fund settlements of domestic exchange, such as checks, bills, drafts, remittance exchange, ATM use and credit card network). Leasehold deposits are recorded as other assets on the balance sheet. Accumulated depreciation is recorded as a deduction from premises and equipment.
(9)		Borrowings consist mainly of borrowings from the Bank of Korea, the Korean government and other banking institutions.
(10)		Call money is included in borrowings at December 31, 2004, 2005, 2006, 2007 and 2008. The balances of call money as of those dates were W655 billion, W1,254 billion, W168 billion, W794 billion and W3,444 billion, respectively.
(11)		Under Korean GAAP, contingent losses with respect to guarantees and acceptances are recognized by applying the same classification methods and provision percentages used in determining the allowance for loan losses. Provisions are only applied to acceptances and guarantees classified as substandard, doubtful and estimated loss. The amounts of allowance as of December 31, 2004, 2005, 2006, 2007 and 2008 were W1 billion, W10 billion, W19 billion, W37 billion and W122 billion, respectively. These amounts are included in other liabilities.
(12)		Under Korean GAAP, minority interests are included in stockholders’ equity. The amounts of minority interests as of December 31, 2004, 2005, 2006, 2007 and 2008 were W28 billion, W39 billion, W44 billion, W44 billion and W233 billion, respectively.

		Year Ended December 31,
		2004				2005				2006				2007				2008(1)
		(Percentages)
Net income as a percentage of:
Average total assets(2)			0.19	%			1.23	%			1.27	%			1.31	%			0.75	%
Average stockholders’ equity(2)			3.78				19.41				17.21				17.12				12.42
Dividend payout ratio(3)			46.95				8.21				49.77				29.84				—
Net interest spread(4)			4.04				3.98				3.69				3.39				2.98
Net interest margin(5)			4.05				4.10				3.90				3.65				3.23
Efficiency ratio(6)			68.97				69.62				71.70				71.11				92.62
Cost-to-average assets ratio(7)			5.66				5.13				5.38				5.29				13.69
Fee income as a percentage of total income(8)			7.28				6.13				6.69				7.02				3.36

(1)		Figures shown in the above table for the year ended December 31, 2008 have been calculated based on (i) the applicable consolidated financial data of Kookmin Bank under Korean GAAP for the period between January 1, 2008 and June 30, 2008 and (ii) our applicable consolidated financial data under Korean GAAP for the period between September 29, 2008 and December 31, 2008, which includes the results of Kookmin Bank and its subsidiaries from July 1, 2008 to September 28, 2008 because the acquisition cost of Kookmin Bank and its subsidiaries in connection with the comprehensive stock transfer pursuant to which we were established has been determined as the net asset amount of Kookmin Bank and its subsidiaries as of June 30, 2008 based on Korean GAAP.
(2)		Average balances are based on (a) daily balances for our primary banking operations and (b) monthly or quarterly balances for our other operations.
(3)		The dividend payout ratio represents the ratio of total dividends paid on common stock as a percentage of net income attributable to common stock.

(4)		Net interest spread represents the difference between the yield on average interest earning assets and cost of average interest bearing liabilities.
(5)		Net interest margin represents the ratio of net interest income to average interest earning assets.
(6)		Efficiency ratio represents the ratio of non-interest expense to the sum of net interest income and non-interest revenue.
(7)		Cost-to-average assets ratio represents the ratio of non-interest expense to average total assets.
(8)		Fee income represents income other than interest income and other operating income, and excludes fees and commissions classified in those categories under Korean GAAP.

		Year Ended December 31,
		2004				2005				2006				2007				2008
		(Percentages)
Consolidated capital adequacy ratio of KB Financial Group(1)			—				—				—				—				11.73	%
Capital adequacy ratios of Kookmin Bank
Tier I capital adequacy ratio(2)			6.67	%			9.67	%			10.07	%			9.74	%			9.92
Tier II capital adequacy ratio(2)			4.34				3.28				4.10				2.88				3.26
Average stockholders’ equity as a percentage of average total assets			5.10				6.31				7.37				7.63				6.06

(1)		Under applicable guidelines of the Financial Services Commission, we, as a bank holding company, are required to maintain a minimum consolidated capital adequacy ratio of 8%. This computation is based on our consolidated financial statements prepared in accordance with Korean GAAP. See “Item 5B. Liquidity and Capital Resources — Financial Condition — Capital Adequacy” in our latest annual report on Form 20-F.
(2)		Kookmin Bank’s capital adequacy ratios are computed in accordance with the guidelines issued by the Financial Services Commission. The computation is based on its consolidated financial statements prepared in accordance with Korean GAAP. See “Item 5B. Liquidity and Capital Resources — Financial Condition — Capital Adequacy” in our latest annual report on Form 20-F.

		As of December 31,
		2004				2005				2006				2007				2008
		(In billions of Won, except percentages)
Non-performing loans(1)		W	3,524			W	2,297			W	1,551			W	1,297			W	2,559
Non-performing loans as a percentage of total loans			2.53	%			1.66	%			1.02	%			0.74	%			1.27	%
Non-performing loans as a percentage of total assets			1.93				1.26				0.78				0.58				0.96
Allowance for loan losses for non-performing loans as a percentage of non-performing loans			47.86				52.83				52.31				53.62				45.18
Total allowance for loan losses as a percentage of total loans			2.25				1.78				1.55				1.44				1.72
Non-performing credits as a percentage of total credits(2)			2.52				1.63				1.00				0.71				1.24
Won loans as a percentage of Won deposits(3)			99.41				96.94				103.01				119.40				126.92
Precautionary loans as a percentage of total loans			4.37				2.30				1.13				0.82				1.45
Precautionary and below loans as a percentage of total loans(4)			6.90				3.97				2.15				1.56				2.71
Precautionary and below loans as a percentage of total assets(4)			5.26				3.00				1.64				1.22				2.05
Allowance for loan losses for precautionary and below loans as a percentage of precautionary and below loans(4)			23.53				28.29				31.03				31.20				28.83

(1)		Non-performing loans are defined in accordance with regulatory guidance in Korea. See “Item 4B. Business Overview — Supervision and Regulation — Principal Regulations Applicable to Banks” in our latest annual report on Form 20-F.
(2)		Credits include loans and confirmed guarantees and acceptances provided from our trust accounts (including bills purchased and privately placed debentures), as well as the total loan portfolio of the banking accounts. Loans, as defined for Korean GAAP purposes, include loans provided from our trust accounts (including bills purchased and privately placed debentures), as well as the total loan portfolio of the banking accounts.
(3)		Under Korean GAAP, Won loans do not include bills bought in Won, advances for customers, credit card accounts, bonds purchased under resale agreements, call loans, private placement corporate bonds and loans in restructurings that have been swapped for equity in the restructured borrower. Including these items, our ratios as of December 31, 2004, 2005, 2006, 2007 and 2008 would have been 109.55%, 107.40%, 117.65%, 134.40% and 140.44%, respectively.
(4)		As defined by the Financial Services Commission.

		KB Financial Group Inc.
		Six Months Ended June 30,
		2009				2009(1)
		(In billions of				(In millions of
		Won, except per				US$, except per
		common share				common share
		data)				data)
Operating revenues:
Interest income		W	5			US$	4
Gain on valuation of equity method investments			414				325
Reversal of allowance for loans			—				—
Operating expenses:
Interest expenses			28				22
Loss on valuation of equity method investments			24				19
Commission expense			4				3
Selling and administrative expenses			15				12
Operating income			348				273
Non-operating income			—				—
Non-operating expenses			—				—
Income before income taxes			348				273
Income tax expense			—				—
Net income		W	348			US$	273
Basic and diluted earnings per share		W	1,127			US$	0.88

		Kookmin Bank
		Six Months Ended June 30,
		2008				2009				2009(1)
		(In billions of Won)								(In millions of US$)
Operating revenues:
Interest revenue		W	7,800			W	7,512			US$	5,899
Gain on valuation and disposal of securities			226				306				240
Gain on disposal of loans for loans receivable			23				40				31
Other operating revenues(2)			7,335				9,115				7,158
Operating expenses:
Interest expenses			4,340				4,400				3,455
Loss on valuation and disposal of securities			111				89				70
Loss on valuation and disposal of loans			409				1,060				832
Other operating expenses(3)			8,842				11,002				8,639
Operating income			1,682				422				332
Non-operating revenue			141				152				119
Non-operating expenses			54				171				134
Income before income taxes			1,769				403				317
Income tax expense			493				16				13
Net income		W	1,276			W	387			US$	304

(1)		Won amounts are expressed in U.S. dollars at the rate of W1,273.5 to US$1.00, the noon buying rate in effect on June 30, 2009 as quoted by the Federal Reserve Bank of New York in the United States.
(2)		Includes principally foreign exchange trading income, commission income, fees and commissions from trust accounts, dividend income and other operating revenue.
(3)		Includes principally foreign exchange trading expenses, commission expenses, general and administrative expenses and other operating expenses.