KB Securities said on Tuesday it decided on a 700 billion won rights issue through a board resolution.

It said the rights issue was decided to pursue both a qualitative improvement in the profit structure and the securing of a foundation for future growth, centered on the direction of KB Financial Group and its affiliates’ conversion and expansion strategy. It plans to allocate capital strategically, focusing on areas with high capital efficiency.

It plans to enhance profitability relative to risk-weighted assets (RoRWA) and improve return on equity (ROE) by improving actual equity, strengthening profitability and soundness in a balanced way.

It also plans to use the capital to raise its ability to respond to future businesses, including upgrading digital-based services, strengthening customer-tailored wealth management capabilities, and enhancing competitiveness in productive finance and capital markets businesses.

It also plans to expand the operating scope of existing licensed businesses, such as issued notes, under risk management principles and to build a sustainable profit base by increasing the stability and efficiency of fund management.

A KB Securities official said the rights issue was a strategic decision to pursue both a shift in the profit structure and an expansion of business areas, and added it would further solidify the brokerage’s core competitiveness based on the strengthened capital foundation.