KB Financial said on Thursday it announced its largest-ever shareholder return through the release of its full-year 2025 business results.

KB Financial's board resolved a fourth-quarter 2025 dividend of 1,605 won per share, about double the 804 won paid a year earlier. Total cash dividends, including cash dividends already paid quarterly in 2025, will reach a record 1.58 trillion won, up 32 percent from a year earlier. The annual payout ratio also hit a record 27 percent, exceeding 25 percent, the benchmark for high-dividend companies, and meeting the requirements for companies subject to separate taxation of dividend income.

It also said a first round of shareholder return resources for 2026, calculated in line with the CET1 ratio at the end of last year, will total a record 2.82 trillion won. KB Financial plans to use 1.62 trillion won for cash dividends and 1.20 trillion won for treasury share purchases.

KB Financial said the shareholder return reflects the government's policy to revitalise the capital market and consideration of shared growth with shareholders. It also outlined a plan to establish itself as a "national dividend stock" by pursuing tax-free dividends through a reduction of capital reserves.

On a conference call, KB Financial explained that its decision to expand cash dividends reflected a comprehensive consideration of deferred execution from past shareholder return expansion and the government policy environment.

KB Financial CFO Sang-rok Na (나상록) said, "When we announced the size of the second shareholder return at 850 billion won at the time, we had said the return scale expanded much more than expected, leaving some dividend resources insufficient, and that we would defer execution of about 190 billion won to early 2026." He added, "After that, we have continuously reviewed how to use about 290 billion won, including that amount, between cash dividends and share buybacks."

He added, "We have considered the government's capital market revitalisation policy, the introduction of separate taxation of dividend income, and the appropriateness of dividend payout ratios and dividend yields from multiple angles."

KB Financial decided to expand cash dividends by reflecting the fulfilment of high-dividend company requirements and the stock price trend. Na said, "We needed to meet the conditions for high-dividend target companies, and in a trend where the PBR was improving rapidly to 0.8 times or more, we judged that some change in shareholder return methods was necessary." He added, "Considering the recent rate of increase in the stock price, we also saw a need to raise the dividend yield."

It also explained the rationale for splitting its share buyback into two rounds. Na said, "As the size of this share buyback expanded significantly, we needed to review the cost of raising funds and the purchase method." He added, "We judged that direct share purchases were better than a trust method, and since direct purchases must be completed within 3 months, we decided to proceed in two rounds."

He added, "This also has the advantage of allowing us to continue share buybacks and cancellations continuously throughout the year."

KB Financial plans to immediately launch the first 600 billion won share buyback following the board resolution on Thursday. It also plans to quickly proceed with the remaining 600 billion won purchase after an additional board resolution during the second quarter.