# EDGAR Filing Document

**Accession Number:** 0001445930
**File Stem:** 0001193125-23-062015
**Filing Date:** 2023-3
**Character Count:** 968094
**Document Hash:** 37d9dc065e8218b2e47857e9b03bdf2c
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-23-062015.hdr.sgml**: 20230307

**ACCESSION NUMBER**: 0001193125-23-062015

**CONFORMED SUBMISSION TYPE**: 6-K

**PUBLIC DOCUMENT COUNT**: 1

**CONFORMED PERIOD OF REPORT**: 20230307

**FILED AS OF DATE**: 20230307

**DATE AS OF CHANGE**: 20230307

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** KB Financial Group Inc.
- **CENTRAL INDEX KEY:** 0001445930
- **STANDARD INDUSTRIAL CLASSIFICATION:** COMMERCIAL BANKS, NEC [6029]
- **IRS NUMBER:** 000000000
- **STATE OF INCORPORATION:** M5
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 6-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-53445
- **FILM NUMBER:** 23710970

**BUSINESS ADDRESS:**
- **STREET 1:** 141, UISADANG-DAERO
- **STREET 2:** YEONGDEUNGPO-GU
- **CITY:** SEOUL
- **STATE:** M5
- **ZIP:** 07332
- **BUSINESS PHONE:** 822-2073-2845

**MAIL ADDRESS:**
- **STREET 1:** 141, UISADANG-DAERO
- **STREET 2:** YEONGDEUNGPO-GU
- **CITY:** SEOUL
- **STATE:** M5
- **ZIP:** 07332

##### [**Table of Contents**](#toc)

------

**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549** 

------

**Form 6-K** 

------

**REPORT OF FOREIGN PRIVATE ISSUER** 

**PURSUANT TO RULE 13a-16 OR 15d-16** 

**UNDER THE SECURITIES EXCHANGE ACT OF 1934** 

**For the month of March 2023** 

**Commission File Number: 000-53445** 

------

## KB Financial Group Inc.
**(Translation of registrant's name into English)** 

------

**26, Gukjegeumyung-ro 8-gil, Yeongdeungpo-gu, Seoul 07331, Korea** 

**(Address of principal executive office)** 

------

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

**Note**: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

**Note**: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

------

##### [**Table of Contents**](#toc)
**Audit Report of KB Securities Co., Ltd. for Fiscal Year 2022** 

On March 7, 2023, KB Financial Group Inc. disclosed audit reports of KB Securities Co., Ltd. ("KB Securities"), its wholly-owned subsidiary, for fiscal year 2022 based on the International Financial Reporting Standards as adopted by the Republic of Korea (including the consolidated and separate financial statements of KB Securities as of and for the years ended December 31, 2022 and 2021 and related notes) received from KPMG Samjong Accounting Corp., its independent auditor. The financial statements in such reports have not been approved by the shareholders of KB Securities and remain subject to change.

KB Financial Group Inc. is furnishing the following documents as exhibits to this Form 6-K filing:

Exhibit 99.1: [An English-language translation of the Consolidated Audit Report of KB Securities for FY 2022.](#ex991)

Exhibit 99.2: [An English-language translation of the Separate Audit Report of KB Securities for FY 2022.](#ex992)

------

##### [**Table of Contents**](#toc)
**SIGNATURES** 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | |
|:---|:---|
|  | KB Financial Group Inc. |
|  | (Registrant) |
| Date: March 7, 2023 | By: /s/ Scott Y. H. Seo |
|  | (Signature) |
|  | Name: Scott Y. H. Seo |
|  | Title: Senior Executive Vice President and Chief Finance Officer |

---

------

##### [**Table of Contents**](#toc)
**Exhibit 99.1** 

**KB SECURITIES CO., LTD.** 

**and Subsidiaries** 

**Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

**(With Independent Auditors' Report Thereon)** 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Index** 

**December 31, 2022 and 2021** 

------

---

| | |
|:---|:---|
|  | **Page(s)** |
|  **[Independent Auditors' Report](#ex99_1477895_1)** | 1~3 |
|  **Consolidated Financial Statements** |  |
|  [Consolidated Statements of Financial Position](#ex99_1477895_2) | 4 |
|  [Consolidated Statements of Profit or Loss](#ex99_1477895_3) | 5 |
|  [Consolidated Statements of Comprehensive Income](#ex99_1477895_4) | 6 |
|  [Consolidated Statements of Changes in Equity](#ex99_1477895_5) | 7 |
|  [Consolidated Statements of Cash Flows](#ex99_1477895_6) | 8 |
|  **[Notes to the Consolidated Financial Statements](#ex99_1477895_7)** | 9~143 |

---

------

##### [**Table of Contents**](#toc)
**Independent Auditors' Report** 

(Based on a report originally issued in Korean)

The Board of Directors and Stockholder

KB Securities Co., Ltd.:

*Opinion* 

We have audited the consolidated financial statements of KB Securities Co., Ltd. and its subsidiaries ("the Group"), which comprise the consolidated statements of financial position as of December 31, 2022 and 2021, the consolidated statements of profit or loss, comprehensive income, changes in equity and cash flows for the years then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2022 and 2021, and its consolidated financial performance and its cash flows for the years then ended in accordance with Korean International Financial Reporting Standards ("K-IFRS").

*Basis for Opinion* 

We conducted our audit in accordance with Korean Standards on Auditing ("KSAs"). Our responsibilities under those standards are further described in the *Auditors' Responsibilities for the Audit of the Consolidated Financial Statements* section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

*Other Matter* 

The procedures and practices utilized in the Republic of Korea to audit such consolidated financial statements may differ from those generally accepted and applied in other countries.

*Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements* 

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with K-IFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

------

##### [**Table of Contents**](#toc)
Those charged with governance are responsible for overseeing the Group's financial reporting process.

*Auditors' Responsibilities for the Audit of the Consolidated Financial Statements* 

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the appropriateness of accounting policies used in the preparation of the consolidated financial
statements and the reasonableness of accounting estimates and related disclosures made by management.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditors' report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditors' report. However, future events or conditions may cause the Group to cease to continue as a going concern.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the
disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in the internal controls that we identify during our audit.

------

##### [**Table of Contents**](#toc)
/s/ KPMG Samjong Accounting Corp.

Seoul, Korea

March 7, 2023

&nbsp;&nbsp;&nbsp;This report is effective as of March 7, 2023, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying consolidated financial statements and notes thereto. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Consolidated Statements of Financial Position** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in Korean won)* | **Notes** | **2022** | **2021** |
|  **Assets** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits | 5363738 | 4537576193522 | 3834048674705 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at fair value through profit or loss | 6363738 | 29549677943839 | 34182334301081 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets | 736373839 | 1724310257882 | 817518307305 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at fair value through other comprehensive income | 8363738 | 4800554237532 | 3839877806177 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in associates | 9 | 300342789927 | 137621441023 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets measured at amortised cost | 1036373839 | 8907503612196 | 7186208182322 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Property and equipment | 1140 | 270030366596 | 210755849488 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment properties | 12 | 560420145484 | 1147746979871 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Intangible assets | 13 | 211868606120 | 185272286741 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current tax assets |  | 9152521243 | 4948083454 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred tax assets | 35 | 1289260036 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets | 1436373839 | 2687932513517 | 3661821844639 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | 15 | 256750883711 | 50892344080 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal group classified as held for sale | 47 |  | 171749315076 |
|  **Total assets** |  | 53817409331605 | 55430795415962 |
|  **Liabilities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit liabilities | 16363738 | 6799233076405 | 8391075182612 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at fair value through profit or loss | 636373839 | 12171579477522 | 11986846570347 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities | 736373839 | 2322476090220 | 874641742107 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings | 1736373839 | 23523195867589 | 24649381850266 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current tax liabilities |  | 4654028924 | 2196195146 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net defined benefit liabilities | 18 | 55507137949 | 55619888673 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred tax liabilities | 35 | 58351713528 | 16878468859 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Provisions | 1948 | 150965405944 | 106123390303 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities | 203637383940 | 2389541471052 | 3484650270838 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities | 21 | 473114503977 | 427826239552 |
|  **Total liabilities** |  | 47948618773110 | 49995239798703 |
|  **Equity** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Share capital | 22 | 1493102120000 | 1493102120000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hybrid securities | 23 | 506130312000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other paid-in capital | 24 | 1478687978420 | 1478687978420 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retained earnings | 25 | 2038449776857 | 2247970109154 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other components of equity | 26 | 323302638251 | 204500516202 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other Comprehensive Income for the disposal group classified as held for sale | 47 |  | 7670746146 |
|  **Equity attributable to shareholders of the Parent Company** |  | 5839672825528 | 5431931469922 |
|  **Non-controlling interest** |  | 29117732967 | 3624147337 |
|  **Total equity** |  | 5868790558495 | 5435555617259 |
|  **Total liabilities and equity** |  | 53817409331605 | 55430795415962 |

---

The above consolidated statements of financial position should be read in conjunction with the accompanying notes**.** 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Consolidated Statements of Profit or Loss** 

**Years Ended December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in Korean won)* | **Notes** | **2022** | **2021** |
|  **Operating income** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fee and commission income | 27 | 939703781530 | 1144248378743 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on valuation and disposal of financial instruments | 28 | 10675519816357 | 5550641843434 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income | 29 | 1160030185663 | 826686736401 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income from financial instruments at FVTPL |  | 543218721819 | 402414577880 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income in applying of effective interest rate |  | 616811463844 | 424272158521 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on valuation and disposal of financial assets measured at amortised costs | 30 | 8462529335 | 7839928487 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on foreign currency transactions | 31 | 1263406410939 | 793253127269 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other operating income | 32 | 222899833390 | 226880484789 |
|  |  | 14270022557214 | 8549550499123 |
|  **Operating expenses** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fee and commission expense | 27 | 194467365522 | 186868006666 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on valuation and disposal of financial instruments | 28 | 11053322410655 | 5581543512545 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest expense | 29 | 618109328244 | 268260223608 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on valuation and disposal of financial assets measured at amortised costs | 30 | 43726891106 | 22862121814 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on foreign currency transactions | 31 | 1265719846490 | 744492109236 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Selling and administrative expenses | 33 | 822594096508 | 855262728540 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other operating expenses | 32 | 27087370821 | 68987483624 |
|  |  | 14025027309346 | 7728276186033 |
|  **Operating profit** |  | 244995247868 | 821274313090 |
|  Non-operating income | 34 | 100717218807 | 48129525832 |
|  Non-operating expenses | 34 | 83385613616 | 51360194503 |
|  **Profit before income tax** |  | 262326853059 | 818043644419 |
|  Income tax expense | 35 | 67499190770 | 217752228397 |
|  **Profit for the year** |  | 194827662289 | 600291416022 |
|  **Profit attributable to:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Shareholders of the Parent Company |  | 193697356041 | 600439340042 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-controlling interest |  | 1130306248 | (147924020) |

---

The above consolidated statements of profit or loss should be read in conjunction with the accompanying notes.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Consolidated Statements of Comprehensive Income** 

**Years Ended December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in Korean won)* | **Notes** | **2022** | **2021** |
|  **Profit for the year** |  | 194827662289 | 600291416022 |
|  **Other comprehensive income(loss)** |  |  |  |
|  **Items that will not be reclassified to profit or loss** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net gains on valuation of equity instruments at fair value through other comprehensive income | 826 | 27415825649 | 27779973437 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fair value changes on financial liabilities designated at fair value due to own credit risk | 626 | 38855084533 | 13714607803 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of the net defined benefit liabilities | 1826 | 2738991283 | (2237583109) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Revaluation of property and equipment | 26 | 35572043723 |  |
|  **Items that may be subsequently reclassified to profit or loss** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net losses on valuation of debt instrument at fair value through other comprehensive income | 826 | (10149158628) | (17213330222) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Share of other comprehensive income(loss) of associates | 926 | (2562095184) | 23492222 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains(Losses) on hedge of net investments in foreign operations | 726 | (5750385868) | (13082538140) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange difference on translation of foreign operations | 26 | 24454947631 | 25060921541 |
|  **Other comprehensive income for the year, net of tax** |  | 110575253139 | 34045543532 |
|  **Total comprehensive income for the year** |  | 305402915428 | 634336959554 |
|  **Total comprehensive income for the year attributable to:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Shareholders of the Parent Company |  | 305090051043 | 634250019566 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-controlling interest |  | 312864385 | 86939988 |

---

The above consolidated statements of comprehensive income should be read in conjunction with the accompanying notes.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Consolidated Statements of Changes in Equity** 

**Years Ended December 31, 2022 and 2021** 

------

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Attributable to the Shareholder of the Parent Company** | **Attributable to the Shareholder of the Parent Company** | **Attributable to the Shareholder of the Parent Company** | **Attributable to the Shareholder of the Parent Company** | **Attributable to the Shareholder of the Parent Company** | **Attributable to the Shareholder of the Parent Company** | **Attributable to the Shareholder of the Parent Company** | | |
|  | **Share**<br> **Capital** | **Hybrid**<br> **Securities** | **Other Paid**<br> **In Capital** | **Retained<br>Earnings** | **Other**<br> **Components**<br> **of Equity** | **Other<br>Comprehensive<br>Income for**<br> **the Disposal<br>Group** | **Total** | **Non-controlling**<br> **Interest** | **Total Equity** |
|  **Balance at January 1, 2021** | 1493102120000 |  | 1478716745754 | 1847509495299 | 178381856637 |  | 4997710217690 | 309888053 | 4998020105743 |
|  **Dividends** |  |  |  | (200000000000) |  |  | (200000000000) |  | (200000000000) |
|  **Revaluations of property and equipments** |  |  |  | 21273813 | (21273813) |  |  |  |  |
|  **Changes in ownership of subsidiaries** |  |  | (28767334) |  |  |  | (28767334) | 3227319296 | 3198551962 |
|  **Total comprehensive income** |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit for the year |  |  |  | 600439340042 |  |  | 600439340042 | (147924020) | 600291416022 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on equity instruments at fair value through other comprehensive income |  |  |  |  | 10566643215 |  | 10566643215 |  | 10566643215 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fair value changes on financial liabilities designated at fair value due to own credit risk |  |  |  |  | 13714607803 |  | 13714607803 |  | 13714607803 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Share of other comprehensive income of associates |  |  |  |  | 23492222 |  | 23492222 |  | 23492222 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of net defined benefit liabilities |  |  |  |  | (2237583109) |  | (2237583109) |  | (2237583109) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on hedge of net investments in foreign operations |  |  |  |  | (13082538140) |  | (13082538140) |  | (13082538140) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange difference on translation of foreign operations |  |  |  |  | 24826057533 |  | 24826057533 | 234864008 | 25060921541 |
|  **Other** |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other Comprehensive income for the disposal group classified as held for sale |  |  |  |  | (7670746146) | 7670746146 |  |  |  |
|  **Balance at December 31, 2021** | 1493102120000 |  | 1478687978420 | 2247970109154 | 204500516202 | 7670746146 | 5431931469922 | 3624147337 | 5435555617259 |
|  **Balance at January 1, 2022** | 1493102120000 |  | 1478687978420 | 2247970109154 | 204500516202 | 7670746146 | 5431931469922 | 3624147337 | 5435555617259 |
|  **Issuance of hybrid securities** |  | 506130312000 |  |  |  |  | 506130312000 |  | 506130312000 |
|  **Dividends of hybrid securities** |  |  |  | (3479007437) |  |  | (3479007437) |  | (3479007437) |
|  **Dividends** |  |  |  | (400000000000) |  |  | (400000000000) |  | (400000000000) |
|  **Changes in scope of consolidation** |  |  |  |  |  |  |  | 25180721245 | 25180721245 |
|  **Revaluations of property and equipments** |  |  |  | 261319099 | (261319099) |  |  |  |  |
|  **Total comprehensive income** |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit for the year |  |  |  | 193697356041 |  |  | 193697356041 | 1130306248 | 194827662289 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on equity instruments at fair value through other comprehensive income |  |  |  |  | 17266667021 |  | 17266667021 |  | 17266667021 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fair value changes on financial liabilities designated at fair value due to own credit risk |  |  |  |  | 38855084533 |  | 38855084533 |  | 38855084533 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Share of other comprehensive income of associates |  |  |  |  | (2562095184) |  | (2562095184) |  | (2562095184) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Revaluation of property and equipment |  |  |  |  | 35572043723 |  | 35572043723 |  | 35572043723 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of net defined benefit liabilities |  |  |  |  | 2738991283 |  | 2738991283 |  | 2738991283 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on hedge of net investments in foreign operations |  |  |  |  | (5750385868) |  | (5750385868) |  | (5750385868) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange difference on translation of foreign operations |  |  |  |  | 25272389494 |  | 25272389494 | (817441863) | 24454947631 |
|  **Other** |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of disposal group classified as held for sale |  |  |  |  | 7670746146 | (7670746146) |  |  |  |
|  **Balance at December 31, 2022** | 1493102120000 | 506130312000 | 1478687978420 | 2038449776857 | 323302638251 |  | 5839672825528 | 29117732967 | 5868790558495 |

---

The above consolidated statements of changes in equity should be read in conjunction with the accompanying notes

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Consolidated Statements of Cash Flows** 

**Years Ended December 31, 2022 and 2021**

------

---

| | | | |
|:---|:---|:---|:---|
| *(in Korean won)* | **Notes** | **2022** | **2021** |
|  **Cash flows from operating activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash generated from operating activities |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit for the year |  | 194827662289 | 600291416022 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustment for non-cash items | 43 | (572686798061) | (417312391023) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in operating assets and liabilities | 43 | (1834957050037) | (1734309882567) |
|  |  | (2212816185809) | (1551330857568) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest received |  | 1260692425883 | 867556903180 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest paid |  | (562087561759) | (262543247334) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends received |  | 55836918623 | 48254346434 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income taxes paid |  | (204765128344) | (211033728541) |
|  **Net cash used in operating activities** |  | (1663139531406) | (1109096583829) |
|  **Cash flows from investing activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Decrease in long-term deposit held by bank |  | 485107462569 | 445606747492 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of financial assets at fair value through other comprehensive income |  | (5425171579537) | (4678422757635) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of financial assets at fair value through other comprehensive income |  | 4476887646352 | 4731871208238 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of investments of associates | 9 | (208688630790) | (238418796834) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of investment of associates | 9 | 42822194202 | 94278366786 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash flows from the acquisition of subsidiaries | 9 | 423141248509 | (4020649275) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash flows from the disposal of subsidiaries | 9 | (23627667983) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of property and equipment | 11 | (29570584652) | (23586057672) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of property and equipment | 11 | 4951169480 | 683373612 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of intangible assets | 13 | (44984648728) | (36856058060) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of intangible assets | 13 | 1019665000 | 2086788000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of investment properties | 12 | (1604544643) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of investment properties | 12 | 568221998917 | 58071100474 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of assets held for sale |  | 180716585190 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | (21285090533) | (26298576016) |
|  **Net cash provided by investing activities** |  | 427935223353 | 324994689110 |
|  **Cash flows from financing activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase in borrowings | 43 | 1763878273662 | 1243604095870 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase(decrease) in guarantee deposit liabilities | 43 | 497469282 | (816464491) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends paid | 25 | (400000000000) | (200000000000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Redemption of principal elements of lease payments | 43 | (30267166265) | (32271499249) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Issuance of hybrid securities | 23 | 506130312000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends of hybrid securities | 25 | (3437500000) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase in share capital |  |  | 3218525903 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase(decrease) in other liabilities | 43 | (28794866335) | 23956770027 |
|  **Net cash provided by financing activities** |  | 1808006522344 | 1037691428060 |
|  **Effect of exchange rate changes on cash and cash equivalents** |  | (4027082739) | 1379611661 |
|  **Net increase in cash and cash equivalents** |  | 568775131552 | 254969145002 |
|  **Cash and cash equivalents at the beginning of the year** | 5 | 675854019618 | 421397220746 |
|  **Cash and cash equivalents at the end of the year** | 5 | 1244629151170 | 676366365748 |
|  **Cash and cash equivalents from the disposal group classified as held for sale** | 47 |  | 512346130 |
|  **Cash and cash equivalents in consolidated statement of financial position as at the end of the year** | 5 | 1244629151170 | 675854019618 |

---

The above consolidated statements of cash flows should be read in conjunction with the accompanying notes.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**1. General Information** 

General information of KB Securities Co., Ltd. (the "Parent Company" or "KB Securities") which is a controlling company in accordance with Korean IFRS No.1110 *Consolidated Financial Statements,* and 97 subsidiaries including KBFG Securities America Inc. is as follows:

The Parent Company was established on June 1, 1962, under the name of Kookil Securities Co., Ltd. On June 5, 1986, the Parent Company changed its name to "Hyundai Securities Co., Ltd.". After several capital increases, the share capital of the Parent Company amounts to W1,493,102 million as at December 31, 2022.

The Parent Company became a wholly owned subsidiary of KB Financial Group Inc. on October 19, 2016, through a comprehensive exchange of shares. At the end of the reporting period, KB Financial Group Inc. owns 100% of ordinary shares of the Parent Company.

Meanwhile, the Parent Company merged with KB Investment & Securities Co., Ltd. (the "KB Investment & Securities") on December 30, 2016 as a surviving company and changed its name to KB Securities Co., Ltd. As at December 31, 2022, the Parent Company has 104 branch offices in Korea and one overseas branch office.

Details of the consolidated subsidiaries as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| **Investor** | **Investee** | **Percentage of<br>ownership (%)** | **Location** | **Date of<br>financial<br>statements** | **Industry** |
|  The Parent Company | KBFG Securities America Inc. | 100.00 | USA | December | Investment,<br> advisory |
|  | KB Securities Hong Kong Ltd. | 100.00 | Hong Kong | December | Investment,<br> advisory |
|  | KB Securities Vietnam Joint Stock<br> Company | 99.81 | Vietnam | December | Investment,<br> advisory |
|  | KB FINA Joint Stock Company | 77.82 | Vietnam | December | IT(Fintech) |
|  | PT. KB Valbury Sekuritas | 65.00 | Indonesia | December | Investment,<br> advisory |
|  | KB Digital Innovation & growth New<br> Technology Business Investment<br> Fund <sup>1</sup> | 20.00 | Korea | December | Other financial |
|  | KB Pre-IPO 2nd (TCB) New<br> Technology Business Investment<br> Fund <sup>1</sup> | 42.86 | Korea | December | Other financial |
|  | JB New Jersey Private Real Estate<br> Fund 1 | 98.15 | Korea | December | Funds |
|  | LB Ireland Private Real Estate<br> Investment Trust 8 | 96.64 | Korea | December | Funds |
|  | Pacific US BlackRock Private<br> Placement Real Estate Fund<br> Investment Trust No. 15 | 98.51 | Korea | December | Funds |
|  | DAOL KTB Aircraft Private Investment Trust No.21-1 | 99.61 | Korea | December | Funds |
|  | Vestas General Private<br> Real Estate Fund Investment<br> Trust No. 38 | 54.92 | Korea | December | Funds |
|  | JB Dry Street Private Fund 1 | 100.00 | Korea | December | Funds |
|  | JB Australia108 Private Fund 1 | 100.00 | Korea | December | Funds |
|  | JB Forge Private Fund 1 | 100.00 | Korea | December | Funds |
|  | JB Hall Street Private Fund 1 | 100.00 | Korea | December | Funds |
|  | JB Margaret Street Private Fund 1 | 100.00 | Korea | December | Funds |
|  | GH Real Estate I LP | 81.00 | Guernsey | December | Investment |
|  | Hanwha US Equity Strategy Private Real Estate Fund 3 | 99.95 | Korea | December | Funds |
|  | GVA Europe Pre-IPO Private<br> Investment Trust No.1 | 100.00 | Korea | December | Funds |
|  | LIFE Global Reits Pre-IPO General<br> Private Investment Trust 1 | 99.50 | Korea | December | Funds |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| **Investor** | **Investee** | **Percentage of<br>ownership (%)** | **Location** | **Date of<br>financial<br>statements** | **Industry** |
|  | KB KBSTAR US Short-Term IG Corporate Bond ETF | 59.88 | Korea | December | Funds |
|  | Able Gwonseon 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Paradise Yeongjong 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar IP Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Songdo PFive 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Gimpo 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Gongpyeong 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Chowall 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | FN Gasan 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Believe Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | ABR Joongang2 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Tongyoung 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Sky 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Poongdong 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Sewoon Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Gasan 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able PT 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Plus 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB MyeongJi 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Dangjin 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Osansegyo 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Mapo 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Wonchang 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Zitaress 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Beomeo-one Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Infra 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Sina Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Gold 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Inspire Gold 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able MK 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Gimpo 4th Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | HD Value 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Powerplay 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Wonsi 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| **Investor** | **Investee** | **Percentage of<br>ownership (%)** | **Location** | **Date of<br>financial<br>statements** | **Industry** |
|  | Able Dosan 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Gimpopoongmoo Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Maseok 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | TW Seocho 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | TW Seocho 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Wave 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Lamdamine 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Next 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Dongil 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Shiny 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Enerbil 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | YSMC 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | HJ Galaxy 3rd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB SmartSchool 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Bighouse 7th Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Energy 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Gyeongsan Logis 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Stoke 2nd Corp <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Samyoung Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Global Contents Private Investment Fund <sup>1</sup> | 27.27 | Korea | December | Other financial |
|  | Newstar Seongnam 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KPS Sihwa 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB NY 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | GDIC 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar NRB First Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Dongtan 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Gimpo 5th Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Cassiopeia 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Banpo 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Banpo 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Gyeonggi Gwangju 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Byeongjeom 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Piggarden 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Mangrove Feeder Fund | 92.88 | Cayman Islands | December | Funds |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| **Investor** | **Investee** | **Percentage of<br>ownership (%)** | **Location** | **Date of<br>financial<br>statements** | **Industry** |
|  Mangrove Feeder<br> Fund | Mangrove Master Fund | 100.00 | Cayman Islands | December | Funds |
|  KB Securities Hong Kong Ltd. | Global Investment Opportunity Limited | 100.00 | Malaysia | December | Financial &<br> real-estate |
|  LB Ireland Private Real Estate Investment Trust 8 | Beckett Acquisition Limited | 100.00 | Ireland | December | Real-estate<br> Investment |
|  JB New Jersey Private Real Estate Fund 1 | ABLE NJ DSM Investment REIT | 99.18 | USA | December | Real-estate<br> Investment |
|  Able NJ DSM Investment REIT | ABLE NJ DSM, LLC | 100.00 | USA | December | Real-estate<br> Investment |
|  Vestas General Private Real Estate Fund Investment Trust No. 38 | Lumen International Developments | 100.00 | Luxemburg | December | Real-estate<br> Investment |
|  Lumen International Developments | VREF Shaftesbury ScSp | 100.00 | Luxemburg | December | Real-estate<br> Investment |
|  PT. KB Valbury Sekuritas | PT. Valbury Capital Management | 79.00 | Indonesia | December | Funds |

---

<sup>1</sup> The Group has a substantive power over the special purpose entities ("SPEs") or investment trusts and is exposed to variable returns. Accordingly, these SPEs and investment trusts are included in subsidiaries although the Group's ownership is less than 50%. 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| **Investor** | **Investee** | **Percentage of<br>ownership (%)** | **Location** | **Date of<br>financial<br>statements** | **Industry** |
|  The Parent Company | KBFG Securities America Inc. | 100.00 | USA | December | Investment,<br> advisory |
|  | KB Securities Hong Kong Ltd. | 100.00 | Hong Kong | December | Investment,<br> advisory |
|  | KB Securities Vietnam Joint Stock Company | 99.81 | Vietnam | December | Investment,<br> advisory |
|  | KB FINA Joint Stock Company | 77.82 | Vietnam | December | IT(Fintech) |
|  | KB Digital Innovation&growth New Technology Business Investment Fund <sup>1</sup> | 20.00 | Korea | December | Other financial |
|  | KB Pre-IPO 2<sup>nd</sup> (TCB) New Technology Business Investment Fund <sup>1</sup> | 42.86 | Korea | December | Other financial |
|  | JB New Jersey Private Real Estate<br> Fund 1 | 98.15 | Korea | December | Funds |
|  | Heungkuk Global Highclass Private Real Estate Trust 23 | 100.00 | Korea | December | Funds |
|  | DGB General Private Real Estate Investment Trust No.8 | 98.77 | Korea | December | Funds |
|  | LB Ireland Private Real Estate<br> Investment Trust 8 | 96.64 | Korea | December | Funds |
|  | Pacific US BlackRock Private Placement Real Estate Fund Investment Trust No.15 | 99.50 | Korea | December | Funds |
|  | KTB Aircraft Private Investment Trust No.21-1 | 99.61 | Korea | December | Funds |
|  | Vestas General Private Real Estate Fund Investment Trust No. 38 | 54.84 | Korea | December | Funds |
|  | JB Dry Street Private Fund 1 | 100.00 | Korea | December | Funds |
|  | JB Australia108 Private Fund 1 | 100.00 | Korea | December | Funds |
|  | JB Forge Private Fund 1 | 100.00 | Korea | December | Funds |
|  | JB Hall Street Private Fund 1 | 100.00 | Korea | December | Funds |
|  | JB Margaret Street Private Fund 1 | 100.00 | Korea | December | Funds |
|  | GH Real Estate I LP | 81.00 | Guernsey | December | Investment |
|  | Alpha Spain Real Estate Private Investment Trust 1 | 99.85 | Korea | December | Funds |
|  | Hanwha US Equity Strategy Private Real Estate Fund 3 | 99.95 | Korea | December | Funds |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| **Investor** | **Investee** | **Percentage of<br>ownership (%)** | **Location** | **Date of<br>financial<br>statements** | **Industry** |
|  | MS Sejong 4th Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB UK Center 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Gwonseon 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | AJH 3rd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Paradise Yeongjong 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar IP Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Enewstay 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Panorama 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Papyrus Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | SJ Jongno 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar DS 1st Co., Ltd <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar DS 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Gamsam 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Songdo PFive 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Gimpo 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Polar EH 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Polar EH 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Gongpyeong 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Chowall 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | FN Gasan 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | ABR Mareuk 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Believe Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Electronics 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Echo 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | ABR Joongang2 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Tongyoung 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Guwol 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Sky 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Gimpo 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Hyosung 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Poongdong 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Sewoon Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Infra 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Intgreen 1st Inc. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Gasan 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| **Investor** | **Investee** | **Percentage of<br>ownership (%)** | **Location** | **Date of<br>financial<br>statements** | **Industry** |
|  | Able Pocheon 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Seotan Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able PT 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Unbroken 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | JOSH Bujeon 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Plus1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB MyeongJi 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Dangjin 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Yongdap 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Osansegyo 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Hyeongok Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Mapo 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | GDIC 1st Co., Ltd, <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Wonchang 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Zitaress 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB PF 3rd Co.,Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Beomeo-one Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able Yucheon 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Infra 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Illite 1st. Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Newstar Sina Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | KB Gold 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Inspire Gold 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Inspire Gold 2nd Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Able MK 1st Co., Ltd, <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Yeoksam The Gallery KB 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Y Three Ulsan Sinjeong 1st Co., Ltd. <sup>1</sup> |  | Korea | December | Asset-backed<br> securitization |
|  | Mangrove Feeder Fund | 92.88 | Cayman Islands | December | Funds |
|  The parent Company and others | LB UK Private Real Estate Investment Trust No.18 | 100.00 | Korea | December | Funds |
|  | LB UK Private Real Estate Investment Trust No.19 | 100.00 | Korea | December | Funds |
|  Mangrove Feeder Fund | Mangrove Master Fund | 100.00 | Cayman Islands | December | Funds |
|  KB Securities Hong Kong Ltd. | Global Investment Opportunity Limited | 100.00 | Malaysia | December | Financial &<br> real-estate |
|  LB Ireland Private Real Estate Investment Trust 8 | Beckett Acquisition Limited | 100.00 | Ireland | December | Real-estate Investment |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| **Investor** | **Investee** | **Percentage of<br>ownership (%)** | **Location** | **Date of<br>financial<br>statements** | **Industry** |
|  SJ Jongno 1st Co., Ltd. | KB Wise Star Real Estate Feeder Fund 2 | 59.86 | Korea | December | Funds |
|  KB Wise Star Real Estate<br> Feeder Fund 2 | KB Wise Star Jongno Tower Real Estate Master Fund | 63.27 | Korea | December | Funds |
|  JB New Jersey Private<br> Real Estate Fund 1 | Able NJ DSM Investment REIT | 99.18 | USA | December | Real-estate<br> Investment |
|  Able NJ DSM Investment<br> REIT | ABLE NJ DSM, LLC | 100.00 | USA | December | Real-estate<br> Investment |
|  Vestas General Private Real Estate Fund Investment<br> Trust No. 38 | Lumen International Developments | 100.00 | Luxemburg | December | Real-estate<br> Investment |
|  Lumen International<br> Developments | VREF Shaftesbury ScSp | 100.00 | Luxemburg | December | Real-estate<br> Investment |
|  LB UK Private Real<br> Estate Investment Trust<br> No.18 and others | Hillswood Finco Ltd. | 100.00 | Jersey | December | Real-estate<br> Investment |
|  | Hillswood Holdings Ltd. | 100.00 | Jersey | December | Real-estate<br> Investment |
|  | Hillswood Holding Property Unit Trust | 100.00 | Jersey | December | Real-estate<br> Investment |
|  Hillswood Holding Property Unit Trust and others | Hillswood Property Unit Trust | 100.00 | Jersey | December | Real-estate<br> Investment |
|  Hanwha US Equity Strategy Private Real Estate Fund 3 | 498 Seventh KOR Holdco LP | 100.00 | USA | December | Real-estate<br> Investment |
|  498 Seventh KOR Holdco LP | 498 Seventh KOR LLC | 100.00 | USA | December | Real-estate<br> Investment |
|  Polar EH 1st Co., Ltd and Others | Multiasset PR Private Fund 4 | 100.00 | Korea | December | Funds |

---

<sup>1</sup> The Group has a substantive power over the special purpose entities ("SPEs") or investment trusts and is exposed to variable returns. Accordingly, these SPEs and investment trusts are included in subsidiaries although the Group's ownership is less than 50%. 

Summarized financial information of major subsidiaries as at and for the years ended December 31, 2022 and 2021, is as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **December 31, 2022** | **December 31, 2022** | **2022** | **2022** | **2022** |
| **Name of subsidiary** | **Assets** | **Liabilities** | **Operating<br>profit** | **Profit (loss)<br>for the year** | **Total**<br> **comprehensive<br>income(loss)** |
|  KBFG Securities America Inc. | 21974646 | 3932730 | 3376122 | (541989) | 667213 |
|  KB Securities Hong Kong Ltd. | 267947007 | 28049102 | 20468272 | (2268070) | 13435805 |
|  KB Securities Vietnam Joint Stock Company | 538755846 | 325475504 | 67884410 | 12933143 | 18583701 |
|  KB FINA Joint Stock Company | 12636459 | 70685 | 275791 | (2614764) | (2098000) |
|  PT. KB Valbury Sekuritas | 117639923 | 43149901 | 20385908 | 5827047 | 5827047 |
|  KB Star Galaxy Towers REIT <sup>1</sup> |  |  | 2553341 | (10206009) | (10206009) |
|  Star Galaxy S.Comm <sup>1</sup> |  |  |  | (6080923) | (6080923) |
|  Star Galaxy GP SRL <sup>1</sup> |  |  |  |  |  |
|  JB New Jersey Private Real Estate Fund 1 | 16374263 | 13853 | 161708 | 242976 | 242976 |
|  Heungkuk Global Highclass Private Real Estate Trust 23 <sup>1</sup> |  |  | 2839 | (865715) | (865715) |
|  DGB General Private Real Estate Investment Trust No.8 <sup>1</sup> |  |  | 232303 | 216175 | 216175 |
|  LB Irealand Private Real Estate Investment Trust 8 | 71328058 | 4377904 | 4112389 | 4154362 | 4056902 |
|  MS Sejong 4th Co., Ltd. <sup>1</sup> |  |  | 125771 | 110439 | 110439 |
|  KB UK Center 1st Co., Ltd. <sup>1</sup> |  |  | 372353 | (1149601) | (1149601) |
|  Mangrove Feeder Fund | 76109836 | 63422 | 951672 | (6940076) | (1459706) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **December 31, 2022** | **December 31, 2022** | **2022** | **2022** | **2022** |
| **Name of subsidiary** | **Assets** | **Liabilities** | **Operating<br>profit** | **Profit (loss)<br>for the year** | **Total**<br> **comprehensive<br>income(loss)** |
|  Mangrove Master Fund | 88568284 | 12377851 | 716348 | (6874702) | (1421334) |
|  GH Real Estate I LP | 26871702 | 908269 |  | (174061) | (1887) |
|  Global Investment Opportunity Limited | 219427 |  | 5 | (17868) | (2232) |
|  Beckett Acquisition Limited | 145620628 | 139138011 | 6217847 | (1688563) | (1627346) |
|  Able NJ DSM Investment REIT | 19268400 | 135044 | 51041 | 106020 | 1343942 |
|  ABLE NJ DSM LLC | 36612465 | 34955598 | 3800646 | 415725 | 500080 |
|  Pacific US BlackRock Private Placement Real Estate Fund Investment Trust No. 15 | 21573206 | 717884 | 2571773 | 686191 | 686191 |
|  DAOL KTB Aircraft Private Investment Trust No.21-1 | 29336296 | 1070 | 2605931 | 2575751 | 2575751 |
|  KB Digital Innovation&growth New Technology Business Investment Fund | 9059924 | 86877 | 398454 | (133573) | (133573) |
|  KB Pre-IPO <sup>2nd</sup> (TCB) New Technology Business Investment Fund | 29462632 | 132329 | 1419188 | (4169037) | (4169037) |
|  Able Gwonseon 1st Co., Ltd. | 11028210 | 11099117 | 877404 | 117500 | 117500 |
|  AJH 3rd Co., Ltd. <sup>1</sup> |  |  | 152869 | 16875 | 16875 |
|  Paradise Yeongjong 2nd Co., Ltd. | 19335720 | 20595641 | 834653 | 17276 | 17276 |
|  Vestas General Private Real Estate Fund Investment Trust No. 38 | 196545423 | 1274568 | 22929571 | 11624590 | 12931030 |
|  Lumen International Developments | 179588369 | 159002766 | 62 | 3038503 | 2075589 |
|  VREF Shaftesbury ScSp | 388861652 | 246797825 | 18142889 | 3035342 | (3764987) |
|  Alpha Spain Real Estate Private Investment Trust 1 <sup>1</sup> |  |  | 6369232 | (1884823) | (1884823) |
|  Korea Investment US Amazon Logistics Private Real Estate Investment Trust NO. 1 <sup>1</sup> |  |  | 167264 | (843255) | (843255) |
|  GVA Europe Real Estate Investment Trust No.2 <sup>1</sup> |  |  | 12547701 | 8153256 | 8153256 |
|  Newstar IP Co., Ltd. | 50393072 | 51300282 | 3338966 | (7607556) | (7607556) |
|  Enewstay 1st Co., Ltd. <sup>1</sup> |  |  | 313332 | (13149) | (13149) |
|  Newstar Panorama 1st Co., Ltd. <sup>1</sup> |  |  | 454498 | 103967 | 103967 |
|  Newstar Papyrus Co., Ltd. <sup>1</sup> |  |  | 906586 | 158694 | 158694 |
|  SJ Jongno 1st Co., Ltd. <sup>1</sup> |  |  | 50 | 4370130 | 4370130 |
|  KB Wise Star Real Estate Feeder Fund 2 <sup>1</sup> |  |  | 360 | 328331 | 328331 |
|  KB Wise Star Jongno Tower Real Estate Master Fund <sup>1</sup> |  |  | 10322976 | (979221) | (979221) |
|  Newstar Ds 1st Co., Ltd <sup>1</sup> |  |  | 203425 | (168254) | (168254) |
|  Newstar Ds 2nd Co., Ltd <sup>1</sup> |  |  | 2290393 | (322231) | (322231) |
|  JB Dry Street Private Fund 1 | 567526 | 9320 | 107918 | (100405) | (100405) |
|  JB Australia108 Private Fund 1 | 390395 | 3652 | 74309 | (80466) | (80466) |
|  JB Forge Private Fund 1 | 279542 | 2956 | 53220 | (50479) | (50479) |
|  JB Hall Street Private Fund 1 | 528967 | 3391 | 100727 | (87747) | (87747) |
|  JB Margaret Street Private Fund 1 | 149507 | 706 | 28448 | (25134) | (25134) |
|  LB UK Private Real Estate Investment Trust No.18 <sup>1</sup> |  |  | 627413 | 1419192 | 1866678 |
|  LB UK Private Real Estate Investment Trust No.19 <sup>1</sup> |  |  | 340636 | 449754 | 592235 |
|  Hillswood Finco Ltd. <sup>1</sup> |  |  | 690408 | 690089 | 207470 |
|  Hillswood Holdings Ltd. <sup>1</sup> |  |  |  | 10952 | (13302) |
|  Hillswood Holding Property Unit Trust <sup>1</sup> |  |  |  | 780929 | (253550) |
|  Hillswood Property Unit Trust <sup>1</sup> |  |  | 3231826 | 695416 | 1268691 |
|  Hanwha US Equity Strategy Private Real Estate Fund 3 | 3326142 | 98615 | 5657760 | 6112708 | 13952708 |
|  PT. Valbury Capital Management | 1202897 | 356410 | 186815 | (727509) | (727509) |
|  Able Gamsam 1st Co., Ltd. <sup>1</sup> |  |  | 1477943 | (118996) | (118996) |
|  Songdo PFive 2nd Co., Ltd. | 116595449 | 115764831 | 6851381 | (468239) | (468239) |
|  Newstar Gimpo 1st Co., Ltd. | 26658736 | 26745174 | 1262574 | (22685) | (22685) |
|  Able Gongpyeong 1st Co., Ltd. | 15400321 | 15369078 | 714177 | (60621) | (60621) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **December 31, 2022** | **December 31, 2022** | **2022** | **2022** | **2022** |
| **Name of subsidiary** | **Assets** | **Liabilities** | **Operating<br>profit** | **Profit (loss)<br>for the year** | **Total**<br> **comprehensive<br>income(loss)** |
|  Able Chowall 1st Co., Ltd. | 16538631 | 16547285 | 1268946 | 206774 | 206774 |
|  FN Gasan 1st Co., Ltd. | 3632778 | 3481433 | 255378 | 153254 | 153254 |
|  Newstar Believe Co., Ltd. | 6159745 | 6456631 | 230276 | (33039) | (33039) |
|  Able Electronics 1st Co., Ltd. <sup>1</sup> |  |  | 1057606 | 128001 | 128001 |
|  KB Echo 1st Co., Ltd. <sup>1</sup> |  |  | 249684 | 42039 | 42039 |
|  ABR Joongang2 1st Co., Ltd. | 20339878 | 20049306 | 1328288 | 173259 | 173259 |
|  KB Tongyoung 1st Co., Ltd. | 23382801 | 23663781 | 1404597 | (36954) | (36954) |
|  Able Sky 1st Co., Ltd. | 30992071 | 30786965 | 2036676 | 667791 | 667791 |
|  Able Poongdong 1st Co., Ltd. | 2250844 | 2230755 | 535360 | 37955 | 37955 |
|  Able Sewoon Co., Ltd. | 42324593 | 42092589 | 1871110 | 1350270 | 1350270 |
|  KB Infra 1st Co., Ltd. <sup>1</sup> |  |  | 495506 | 303769 | 303769 |
|  Able Gasan 1st Co., Ltd. | 56261340 | 56469935 | 2248974 | (159209) | (159209) |
|  Able PT 1st Co., Ltd. | 5357328 | 5672357 | 410380 | (155986) | (155986) |
|  JOSH Bujeon 1st Co., Ltd. <sup>1</sup> |  |  | 749518 | 161958 | 161958 |
|  Newstar Plus 1st Co., Ltd. | 16425333 | 16155277 | 946049 | (21792) | (21792) |
|  KB MyeongJi 1st Co., Ltd. | 14845247 | 14747007 | 1133331 | 51334 | 51334 |
|  Able Dangjin 1st Co., Ltd. | 21240500 | 20722700 | 2039533 | 601973 | 601973 |
|  KB Osansegyo 2nd Co., Ltd. | 8331040 | 8332477 | 367678 | 18856 | 18856 |
|  Able Hyeongok Co., Ltd. <sup>1</sup> |  |  | 435511 | 76408 | 76408 |
|  KB Mapo 2nd Co., Ltd. | 9660645 | 10558924 | 600086 | (1017998) | (1017998) |
|  GDIC 1st Co., Ltd. <sup>1</sup> |  |  | 687659 | 113676 | 113676 |
|  Able Wonchang 1st Co., Ltd. | 7413923 | 7460083 | 593202 | 180359 | 180359 |
|  Zitaress 1st Co., Ltd. | 30459310 | 30637401 | 2481796 | 554295 | 554295 |
|  KB PF 3rd Co., Ltd. <sup>1</sup> |  |  | 60371 | (16590) | (16590) |
|  Able Beomeo-one Co., Ltd. | 31314357 | 31528461 | 1740919 | (149114) | (149114) |
|  Able Yucheon 1st Co., Ltd. <sup>1</sup> |  |  | 1189618 | 70338 | 70338 |
|  KB Infra 2nd Co., Ltd. | 25913932 | 25600000 | 3554664 | 2449424 | 2449424 |
|  KB Illite 1st. Co., Ltd. <sup>1</sup> |  |  | 62662 | 42928 | 42928 |
|  Newstar Sina Co., Ltd. | 26169067 | 26777858 | 3461385 | (239635) | (239635) |
|  KB Gold 1st Co., Ltd. | 19649512 | 19634471 | 1052179 | (24389) | (24389) |
|  Inspire Gold 2nd Co., Ltd. | 6511331 | 6724045 | 414404 | 81999 | 81999 |
|  Able MK 1st Co., Ltd. | 16028254 | 16129707 | 542536 | (62319) | (62319) |
|  Yeoksam The Gallery KB 1st Co., Ltd. <sup>1</sup> |  |  | 247250 | 107440 | 107440 |
|  Able Hagunri 2nd Co., Ltd. <sup>1</sup> |  |  | 219746 | (222462) | (222462) |
|  Able Hagunri 1st Co., Ltd. <sup>1</sup> |  |  | 607111 | (461916) | (461916) |
|  Newstar Gimpo 4th Co., Ltd. | 7454744 | 7463615 | 1563374 | (8881) | (8881) |
|  Mobius 1st Co., Ltd. <sup>1</sup> |  |  | 3492403 | (1471211) | (1471211) |
|  Able Wonsi 1st Co., Ltd. | 14559454 | 15357586 | 613555 | (798134) | (798134) |
|  HD Value 1st Co., Ltd. | 103745143 | 103754543 | 3401791 | (9410) | (9410) |
|  Able iFood Co., Ltd. <sup>1</sup> |  |  | 192877 | (67044) | (67044) |
|  Powerplay 1st Co., Ltd. | 936550 | 648510 | 315472 | 288040 | 288040 |
|  Able Dosan 1st Co., Ltd. | 30776101 | 30561669 | 3121893 | 214432 | 214432 |
|  Newstar Gimpopoongmoo Co., Ltd. | 12963604 | 12803820 | 831422 | 159774 | 159774 |
|  Able Eunhwasam 1st Co., Ltd. <sup>1</sup> |  |  | 95517 | (593461) | (593461) |
|  Able Maseok 1st Co., Ltd. | 37001664 | 37302631 | 1797458 | (300967) | (300967) |
|  TW Seocho 1st Co., Ltd. | 127729286 | 127959304 | 7129984 | (230020) | (230020) |
|  TW Seocho 2nd Co., Ltd. | 31151796 | 31501706 | 2433454 | (349911) | (349911) |
|  HJ Galaxy 2nd Co., Ltd. <sup>1</sup> |  |  | 4 | (2469661) | (2469661) |
|  HJ Galaxy 1st Co., Ltd. <sup>1</sup> |  |  | 4 | (2469661) | (2469661) |
|  Newstar Wave 1st Co., Ltd. | 82544796 | 83330039 | 2943812 | (785244) | (785244) |
|  Lamdamine 1st Co., Ltd. | 116843965 | 116990938 | 5880378 | (146983) | (146983) |
|  Able Cheongdam 1st Co., Ltd. <sup>1</sup> |  |  | 38500 | (1535710) | (1535710) |
|  Able Next 1st Co., Ltd. | 19966621 | 20958379 | 646331 | (991759) | (991759) |
|  Able Dongil 1st Co., Ltd. | 34259463 | 34383502 | 1046244 | (124039) | (124039) |
|  KB Infra 3rd Co., Ltd. <sup>1</sup> |  |  | 20360506 | 546464 | 546464 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **December 31, 2022** | **December 31, 2022** | **2022** | **2022** | **2022** |
| **Name of subsidiary** | **Assets** | **Liabilities** | **Operating<br>profit** | **Profit (loss)<br>for the year** | **Total**<br> **comprehensive<br>income(loss)** |
|  Newstar Shiny 1st Co., Ltd. | 11617906 | 11814211 | 3251029 | (196305) | (196305) |
|  Newstar Enerbil 1st Co., Ltd. | 100745544 | 100928150 | 4195532 | (182607) | (182607) |
|  YSMC 1st Co., Ltd. | 48024951 | 48917200 | 485395 | (892251) | (892251) |
|  HJ Galaxy 3rd Co., Ltd. | 46923255 | 46693790 | 2153728 | 229463 | 229463 |
|  KB SmartSchool 1st Co., Ltd. | 19882283 | 20346849 | 830186 | (464567) | (464567) |
|  Bighouse 7th Co., Ltd. | 128038169 | 129023438 | 5469280 | (985271) | (985271) |
|  Newstar Energy 1st Co., Ltd. | 141323880 | 146942708 | 4235971 | (5618829) | (5618829) |
|  Gyeongsan Logis 1st Co., Ltd. | 5699700 | 5142180 | 1109798 | 557521 | 557521 |
|  Stoke 2nd Corp | 68517144 | 67873346 | 3617438 | 643797 | 643797 |
|  KB Samyoung Co., Ltd. | 6127059 | 6100421 | 253579 | 26637 | 26637 |
|  KB Global Contents Private Investment Fund | 16269051 | 62384 | 3665 | (293332) | (293332) |
|  Able Sungsoo 1st Co., Ltd. <sup>1</sup> |  |  | 118634 | (307677) | (307677) |
|  Newstar Seongnam 1st Co., Ltd. | 19861686 | 19568965 | 1269626 | 292711 | 292711 |
|  KPS Sihwa 1st Co., Ltd. | 111513923 | 107944392 | 8827790 | 3569530 | 3569530 |
|  KB Baegun 1st Co., Ltd. <sup>1</sup> |  |  | 91672 | (165149) | (165149) |
|  KB NY 1st Co., Ltd. | 89697004 | 91404086 | 2057296 | (1707083) | (1707083) |
|  GDIC 2nd Co., Ltd. | 28393137 | 28901165 | 829935 | (508029) | (508029) |
|  Newstar NRB First Co., Ltd. | 23379924 | 25188216 | 959720 | (1808302) | (1808302) |
|  Able Dongtan 1st Co., Ltd. | 41734980 | 42606597 | 2157554 | (871617) | (871617) |
|  Galaxy properties SA <sup>1</sup> |  |  |  |  |  |
|  Newstar Gimpo 5th Co., Ltd. | 738430 | 2219448 | 3306120 | (1481028) | (1481028) |
|  Polar EH 1st Co., Ltd <sup>1</sup> |  |  |  |  |  |
|  Polar EH 2nd Co., Ltd <sup>1</sup> |  |  |  |  |  |
|  ABR Mareuk 1st Co., Ltd <sup>1</sup> |  |  |  |  |  |
|  Able Guwol 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Newstar Gimpo 2nd Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Hyosung 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Intgreen 1st Inc. <sup>1</sup> |  |  |  |  |  |
|  Able Pocheon 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Newstar Seotan Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Unbroken 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Yongdap 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Inspire Gold 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Y Three Ulsan Sinjeong 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  498 Seventh KOR Holdco LP <sup>1</sup> |  |  |  |  |  |
|  498 Seventh KOR LLC <sup>1</sup> |  |  |  |  |  |
|  Multiasset PR Private Fund 4 <sup>1</sup> |  |  |  |  |  |
|  GVA Europe Pre-IPO Private Investment Trust No.1 | 29981695 | 21250 | 5910 | (39555) | (39555) |
|  LIFE Global Reits Pre-IPO General Private Investment Trust 1 | 59725094 | 40778 | 3145 | (85683) | (85683) |
|  KB KBSTAR US Short-Term IG Corporate Bond ETF | 79748964 | 32248 | 1469729 | (3783284) | (3783284) |
|  Newstar Everyday 1st Co., Ltd. <sup>1</sup> |  |  | 93622 | (43869) | (43869) |
|  Cassiopeia 1st Co., Ltd. | 30678964 | 30909850 | 646125 | (230886) | (230886) |
|  Able Banpo 1st Co., Ltd. | 17117224 | 17316738 | 604933 | (199514) | (199514) |
|  Able Banpo 2nd Co., Ltd. | 10852267 | 11029704 | 289383 | (177437) | (177437) |
|  Able Gyeonggi Gwangju 1st Co., Ltd. | 41299147 | 41679524 | 917840 | (380379) | (380379) |
|  Newstar Byeongjeom 1st Co., Ltd. | 51336358 | 51495155 | 1540423 | (158806) | (158806) |
|  Piggarden 1st Co., Ltd. | 51230153 | 51542651 | 134894 | (312508) | (312508) |

---

<sup>1</sup> These companies are excluded from subsidiaries as at December 31, 2022.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **December 31, 2021** | **December 31, 2021** | **2021** | **2021** | **2021** |
| **Name of subsidiary** | **Assets** | **Liabilities** | **Operating<br>profit** | **Profit (loss)<br>for the year** | **Total**<br> **comprehensive<br>income(loss)** |
|  KBFG Securities America Inc. | 21580938 | 4206235 | 2764166 | (346673) | 1099379 |
|  KB Securities Hong Kong Ltd. | 268831976 | 42369875 | 12809339 | 952820 | 8117459 |
|  KB Securities Vietnam Joint Stock Company | 459400541 | 264703900 | 48674216 | 11562680 | 22854982 |
|  KB FINA Joint Stock Company | 14703822 | 40048 | 132397 | (791669) | 461738 |
|  Hyundai Dynamic Mix Securities Feeder Investment Trust 1 <sup>1</sup> |  |  | 623 | 1776805 | 1776805 |
|  Hyundai Kon-tiki Specialized Privately Placed Fund 1 <sup>1</sup> |  |  | 105752 | 102481 | 102481 |
|  JB New Jersey Private Real Estate Fund 1 | 17280644 | 13210 | 8780 | 1366923 | 1366923 |
|  Heungkuk Global Highclass Private Real Estate Trust 23 | 2334694 | 382 | 269624 | 340571 | 340571 |
|  DGB General Private Real Estate Investment Trust No.8 | 7096984 | 4039 | 416708 | 384386 | 384386 |
|  LB Ireland Private Real Estate Investment Trust 8 | 71323756 | 3815738 | 4276418 | 3735362 | 3690262 |
|  Aquila Global Real Assets Fund No.1 LP <sup>1</sup> |  |  |  | (36818) | (2575440) |
|  MS Sejong 4th Co., Ltd. | 1982145 | 2300224 | 3048532 | 2483249 | 2483249 |
|  Able Hana Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  KB UK Center 1st Co., Ltd. | 12832231 | 12320000 | 748451 | 15595 | 15595 |
|  AKB 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Mangrove Feeder Fund | 78341942 | 835822 | 6375067 | 4799816 | 10737381 |
|  Mangrove Master Fund | 78763150 | 442176 | 8257033 | 6400494 | 9284184 |
|  GH Real Estate I LP | 26701788 | 736468 |  | (9511479) | (9321938) |
|  Global Investment Opportunity Limited | 221660 |  | 13 | (17637) | 46411 |
|  Hyundai Dynamic Mix Securities Master Investment Trust 1 <sup>1</sup> |  |  | 1334540 | 662176 | 662176 |
|  Beckett Acquisition Limited | 147825721 | 139715758 | 6225571 | (1598561) | (1549839) |
|  AGRAF Real Estate Holding No.1, Senningerberg <sup>1</sup> |  |  |  | (7091) | (302872) |
|  Vierte CasaLog GmbH & Co. KG <sup>1</sup> |  |  |  | (1474) | 7968 |
|  Able NJ DSM Investment REIT | 18024689 | 93207 | 451 | 1319458 | 2811740 |
|  ABLE NJ DSM, LLC | 33998186 | 32699331 | 3366644 | 368253 | 536964 |
|  Hyundai Able Investment REIT <sup>1</sup> |  |  |  | (59279) | (14347711) |
|  Hyundai Able Patriots Park, LLC <sup>1</sup> |  |  | 13446 | (609596) | (13931605) |
|  Pacific US BlackRock Private Placement Real Estate Fund Investment Trust No. 15 | 18833391 | 1122501 | 2573430 | 444171 | 444171 |
|  KTB Aircraft Private Investment Trust No.21-1 | 27792980 | 1005 | 3861535 | 1781831 | 1781831 |
|  KB Digital Innovation&growth New Technology Business Investment Fund | 9106621 |  | 499687 | (173987) | (173987) |
|  KB Pre-IPO 2nd (TCB) New Technology Business Investment Fund | 33499341 |  | 1316449 | (1474661) | (1474661) |
|  Crescendo Muju Co., Ltd. <sup>1</sup> |  |  | 284915 | (109840) | (109840) |
|  Able Gwonseon 1st Co., Ltd. | 32779838 | 32968244 | 1377937 | (11855) | (11855) |
|  Great GM 12th Co., Ltd. <sup>1</sup> |  |  | 88964 | (49171) | (49171) |
|  AJH 3rd Co., Ltd. | 10110238 | 9699103 | 652509 | 384693 | 384693 |
|  Able Youto 1st Co., Ltd. <sup>1</sup> |  |  | 241382 | 24308 | 24308 |
|  Paradise Yeongjong 2nd Co., Ltd. | 18947086 | 20224283 | 713825 | 96773 | 96773 |
|  Newstar Hakgok Co., Ltd. <sup>1</sup> |  |  | 83725 | (73045) | (73045) |
|  Songdo PSeven 1st Co., Ltd. <sup>1</sup> |  |  | 735419 | 103203 | 103203 |
|  Newstar Janghyun Co., Ltd. <sup>1</sup> |  |  | 63603 | 4294 | 4294 |
|  Vestas General Private Real Estate Fund Investment Trust No. 38 | 191874304 | 20829940 | 24444349 | 11671992 | 9550692 |
|  Lumen International Developments | 187921665 | 169411650 |  | (3092883) | (1621941) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **December 31, 2021** | **December 31, 2021** | **2021** | **2021** | **2021** |
| **Name of subsidiary** | **Assets** | **Liabilities** | **Operating<br>profit** | **Profit (loss)<br>for the year** | **Total**<br> **comprehensive<br>income(loss)** |
|  VREF Shaftesbury ScSp | 417474574 | 256829371 | 15588207 | (932583) | 11523839 |
|  Alpha Spain Real Estate Private Investment Trust 1 | 70314496 | 699149 | 6513674 | 3779385 | 3779385 |
|  Hangang Domestic Private Real Estate Fund No.14 <sup>1</sup> |  |  | 3073203 | 2930614 | 2930614 |
|  Pacific Bric Professional Investors' Private Real Estate Fund #53 <sup>1</sup> |  |  | 306611 | (3387196) | (3387196) |
|  Newstar SH Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Newstar IP Co., Ltd. | 57759138 | 51058792 | 9949392 | 7902486 | 7902486 |
|  Newstar Daerim Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Enewstay 1st Co., Ltd. | 33891253 | 25602225 | 6195490 | 4598576 | 4598576 |
|  Able Dangsan Co., Ltd. <sup>1</sup> |  |  | 516589 | 146735 | 146735 |
|  Newstar Panorama 1st Co., Ltd. | 11737029 | 11058494 | 1815003 | (146738) | (146738) |
|  Newstar Papyrus Co., Ltd. | 23623123 | 24136636 | 3488162 | 194277 | 194277 |
|  SJ Jongno 1st Co., Ltd. | 66995875 | 70000315 | 243 | (452638) | (452638) |
|  KB Wise Star Real Estate Feeder Fund 2 | 112043149 | 155695 | 164 | 366559 | 366559 |
|  Newstar Cheonwon Co., Ltd. <sup>1</sup> |  |  | 142977 | 49106 | 49106 |
|  Able KD 2nd Co., Ltd. <sup>1</sup> |  |  | 79490 | 9548 | 9548 |
|  KB Wise Star Jongno Tower Real Estate Master Fund | 506092706 | 343917362 | 25784666 | 4169466 | 4169466 |
|  Newstar DS 1st Co., Ltd. | 15650452 | 15459429 | 825274 | 47314 | 47314 |
|  Newstar DS 2nd Co., Ltd. | 39084153 | 38559691 | 2755661 | 874314 | 874314 |
|  Able Yongin 1st Co., Ltd. <sup>1</sup> |  |  | 637515 | (333931) | (333931) |
|  JB Dry Street Private Fund1 | 810359 | 9331 | 18168 | (183979) | (183979) |
|  JB Australia108 Private Fund1 | 569525 | 3559 | 22681 | (118023) | (118023) |
|  JB Forge Private Fund1 | 400525 | 2890 | 22234 | (91765) | (91765) |
|  JB Hall Street Private Fund1 | 752539 | 3212 | 16937 | (169292) | (169292) |
|  JB Margaret Street Private Fund1 | 213009 | 713 | 4785 | (48065) | (48065) |
|  LB UK Private Real Estate Investment Trust No.18 | 33865289 | 1435798 | 756376 | 1074466 | (193840) |
|  LB UK Private Real Estate Investment Trust No.19 | 10781038 | 520304 | 704364 | 341262 | (62572) |
|  Hillswood Finco Ltd. | 14601547 | 28965 | 1172915 | 1115585 | 1964926 |
|  Hillswood Holdings Ltd. | 800128 | 51390 |  | 46376 | 90083 |
|  Hillswood Holding Property Unit Trust | 30623011 | 7302 |  | 2314470 | 4119977 |
|  Hillswood Property Unit Trust | 101477561 | 74903616 | 10286987 | 3182999 | 3328330 |
|  Hanwha US Equity Strategy Private Real Estate Fund 3 | 177311233 | 8216449 | 1194090 | (2653191) | (10493191) |
|  498 Seventh KOR Holdco LP | 175275036 |  |  | 3482029 | 9445146 |
|  498 Seventh KOR LLC | 174675770 |  |  | 3439624 | 9260088 |
|  Newstar Wanee 1st Co., Ltd. <sup>1</sup> |  |  | 80433 | 6137 | 6137 |
|  Able Gamsam 1st Co., Ltd. | 41137786 | 41061686 | 1869333 | 157804 | 157804 |
|  Songdo PFive 2nd Co., Ltd. | 120732282 | 119433425 | 3427099 | (148924) | (148924) |
|  Able Sungnae 1st Co., Ltd. <sup>1</sup> |  |  | 166500 | 11720 | 11720 |
|  Newstar Gimpo 1st Co., Ltd. | 26487012 | 26550765 | 1297627 | (493592) | (493592) |
|  Able Ali 2nd Co., Ltd. <sup>1</sup> |  |  | 334739 | 76137 | 76137 |
|  KB PF 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Daepo 1st Co., Ltd. <sup>1</sup> |  |  | 10225 | (10756) | (10756) |
|  KB Ansung 1st Co., Ltd. <sup>1</sup> |  |  | 841784 | 625535 | 625535 |
|  Polar EH 1st Co., Ltd. | 17283232 | 16715582 |  | (30553) | (30553) |
|  Polar EH 2nd Co., Ltd. | 17611212 | 16700829 |  | 293964 | 293964 |
|  Polar SQ 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Polar SQ 2nd Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Mojong 1st Co., Ltd. <sup>1</sup> |  |  | 378965 | 14531 | 14531 |
|  Able Sungsoo 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Multiasset PR Private Fund 3 <sup>1</sup> |  |  |  |  |  |
|  Multiasset PR Private Fund 4 | 33070238 | 7823 | 2472127 | 2310401 | 2310401 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **December 31, 2021** | **December 31, 2021** | **2021** | **2021** | **2021** |
| **Name of subsidiary** | **Assets** | **Liabilities** | **Operating<br>profit** | **Profit (loss)<br>for the year** | **Total**<br> **comprehensive<br>income(loss)** |
|  Able Daenong Co., Ltd. <sup>1</sup> |  |  | 650042 | 502386 | 502386 |
|  Newstar Chimsan 1st Co., Ltd. <sup>1</sup> |  |  | 63468 | 39690 | 39690 |
|  Able Forsythia 1st Co., Ltd. <sup>1</sup> |  |  | 148431 | (217) | (217) |
|  Able IFP 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Newstar JY Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Gorim 1st Co., Ltd. <sup>1</sup> |  |  | 562999 | (216354) | (216354) |
|  KB Asan Baebang 1st Co., Ltd. <sup>1</sup> |  |  | 275164 | (11642) | (11642) |
|  KB Icheon logistics 1st Co., Ltd. <sup>1</sup> |  |  | 926169 | 186398 | 186398 |
|  Able Unicity 4th Co., Ltd. <sup>1</sup> |  |  | 219123 | 15162 | 15162 |
|  Able Gongpyeong 1st Co., Ltd. | 12385645 | 12293780 | 489653 | 100623 | 100623 |
|  Hamilton Power First Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Chowall 1st Co., Ltd. | 30315210 | 30530637 | 867342 | (371278) | (371278) |
|  Startwithone Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Silver Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  KB Osansaegyo Co., Ltd. <sup>1</sup> |  |  | 1277375 | 317179 | 317179 |
|  HD Yongin 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  FN Gasan 1st Co., Ltd. | 5613186 | 5615094 | 271985 | 23350 | 23350 |
|  ABR Mareuk 1st Co., Ltd. | 5726164 | 5771880 | 323057 | (33590) | (33590) |
|  Newstar Believe Co., Ltd. | 5094388 | 5358236 | 300674 | (78470) | (78470) |
|  Able Electronics 1st Co., Ltd. | 70918879 | 70743905 | 2906579 | 501688 | 501688 |
|  KB Echo 1st Co., Ltd. | 31945662 | 31709287 | 825673 | 99261 | 99261 |
|  KB Wondong 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Newstar Joongbong Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Island 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Gumi 1st Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Able Gwangmyeong 2nd Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  ABR Joongang2 1st Co., Ltd. | 17317313 | 17200000 | 669187 | 33369 | 33369 |
|  Able Bucheon Co., Ltd. <sup>1</sup> |  |  |  |  |  |
|  Newstar Kumo 1st Co., Ltd. <sup>1</sup> |  |  | 130911 | (90714) | (90714) |
|  KB Tongyoung 1st Co., Ltd. | 22993998 | 23238024 | 1116564 | (74534) | (74534) |
|  Able Seoho 1st Co., Ltd. <sup>1</sup> |  |  | 751975 | 200137 | 200137 |
|  KS Beta Co., Ltd. <sup>1</sup> |  |  | 247812 | (423157) | (423157) |
|  Able Guwol 1st Co., Ltd. | 42548129 | 42708587 | 3452641 | (160459) | (160459) |
|  Able Bukcheonan logis Co., Ltd. <sup>1</sup> |  |  | 109195 | (36105) | (36105) |
|  ABR Sosa 1st Co., Ltd. <sup>1</sup> |  |  | 284549 | 4731 | 4731 |
|  Able Sky 1st Co., Ltd. | 26887526 | 27350210 | 1236493 | (462685) | (462685) |
|  Newstar Gimpo 2nd Co., Ltd. | 12922823 | 12583875 | 643724 | 338948 | 338948 |
|  Able HD 1st Co., Ltd. <sup>1</sup> |  |  | 745078 | (104167) | (104167) |
|  Able Eumsung 1st Co., Ltd. <sup>1</sup> |  |  | 175342 | (1034305) | (1034305) |
|  Able Jinjeop 1st Co., Ltd. <sup>1</sup> |  |  | 516497 | 1143 | 1143 |
|  Able Hyosung 1st Co., Ltd. | 41042856 | 41157513 | 4504061 | (114657) | (114657) |
|  Able Poongdong 1st Co., Ltd. | 4317224 | 4335090 | 1263346 | (17867) | (17867) |
|  Able Ansan Logistics 1st Co., Ltd. <sup>1</sup> |  |  | 654753 | (66114) | (66114) |
|  Able Sewoon Co., Ltd. | 48749772 | 49868038 | 2672645 | (1118267) | (1118267) |
|  Newstar Sinchun 1st Co., Ltd. <sup>1</sup> |  |  | 1395945 | (1214862) | (1214862) |
|  Songam Park Development Co., Ltd. <sup>1</sup> |  |  | 989226 | (806250) | (806250) |
|  KB Infra 1st Co., Ltd. | 12303652 | 12076752 | 883940 | 226899 | 226899 |
|  Pinetridavil Co., Ltd. <sup>1</sup> |  |  | 52515 | (41987) | (41987) |
|  Able Udong 1st Co., Ltd. <sup>1</sup> |  |  | 346093 | (160092) | (160092) |
|  Intgreen 1st Inc. | 47999345 | 48660080 | 3721145 | (660736) | (660736) |
|  Able Gasan 1st Co., Ltd. | 37445837 | 37495224 | 779336 | (49397) | (49397) |
|  Able Pocheon 1st Co., Ltd. | 12433033 | 12386939 | 767388 | 46084 | 46084 |
|  Able HD 1st Co., Ltd. <sup>1</sup> |  |  | 182154 | (6593) | (6593) |
|  Newstar Seotan Co., Ltd. | 25453253 | 25244391 | 909922 | 208861 | 208861 |
|  Able PT 1st Co., Ltd. | 5320918 | 5479961 | 235449 | (159043) | (159043) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **December 31, 2021** | **December 31, 2021** | **2021** | **2021** | **2021** |
| **Name of subsidiary** | **Assets** | **Liabilities** | **Operating<br>profit** | **Profit (loss)<br>for the year** | **Total**<br> **comprehensive<br>income(loss)** |
|  Unbroken 1st Co., Ltd. | 30139281 | 30594090 | 1444316 | (454818) | (454818) |
|  JOSH Bujeon 1st Co., Ltd. | 43824332 | 44414622 | 2162798 | (590291) | (590291) |
|  Newstar Plus1st Co., Ltd. | 16291848 | 16000000 | 983294 | 291847 | 291847 |
|  KB MyeongJi 1st Co., Ltd. | 20274550 | 20227645 | 1010483 | 46904 | 46904 |
|  Able Dangjin 1st Co., Ltd. | 4816012 | 4900184 | 213318 | (84173) | (84173) |
|  Able Yongdap 1st Co., Ltd. | 29400401 | 29472471 | 419921 | (72071) | (72071) |
|  Newstar Cold Co., Ltd. <sup>1</sup> |  |  | 680990 | 33877 | 33877 |
|  Betares Co., Ltd. <sup>1</sup> |  |  | 25957 | (51103) | (51103) |
|  KB Osansegyo 2nd Co., Ltd. | 8783276 | 8803570 | 94489 | (20295) | (20295) |
|  Able Hyeongok Co., Ltd. | 40810870 | 40874717 | 437768 | (63847) | (63847) |
|  KB Mapo 1st Co., Ltd. <sup>1</sup> |  |  | 129548 | (175522) | (175522) |
|  KB Mapo 2nd Co., Ltd. | 10226260 | 10106541 | 607135 | 119718 | 119718 |
|  GDIC 1st Co., Ltd. | 39725004 | 40141819 | 379002 | (416816) | (416816) |
|  Able Wonchang 1st Co., Ltd. | 6922644 | 7149163 | 242590 | (226520) | (226520) |
|  Zitaress 1st Co., Ltd. | 120820787 | 121553173 | 1429381 | (732387) | (732387) |
|  KB PF 3rd Co., Ltd. | 4563969 | 4572360 | 58149 | (8391) | (8391) |
|  Able Beomeo-one Co., Ltd. | 30299257 | 30364248 | 917194 | (65001) | (65001) |
|  Able UC 1st Co., Ltd. | 61068251 | 62074292 | 1543816 | (1006051) | (1006051) |
|  KB Infra 2nd Co., Ltd. | 54638508 | 56774000 | 3 | (2135493) | (2135493) |
|  KB Illite 1st. Co., Ltd. | 407670 | 445261 | 4706 | (37591) | (37591) |
|  Newstar Sina Co., Ltd. | 23631797 | 24000954 | 391866 | (369158) | (369158) |
|  KB Gold 1st Co., Ltd. | 17837500 | 17798070 | 176400 | 39420 | 39420 |
|  Inspire Gold 1st Co., Ltd. | 24066879 | 24707879 | 200902 | (641001) | (641001) |
|  Inspire Gold 2nd Co., Ltd. | 15646996 | 15941709 | 193834 | (294714) | (294714) |
|  Able MK 1st Co., Ltd. | 16095465 | 16134601 | 47695 | (39137) | (39137) |
|  Yeoksam The Gallery KB 1st Co., Ltd. | 18689485 | 18711272 | 25547 | (21797) | (21797) |
|  Y Three Ulsan Sinjeong 1st Co., Ltd. | 60232975 | 60507108 | 54968 | (274136) | (274136) |

---

<sup>1</sup> These companies were excluded from subsidiaries as at December 31, 2021.

The details of changes in scope for consolidation for the year ended December 31, 2022, are as follows:

*(a)* *Subsidiaries newly included in the consolidation* 

---

| | |
|:---|:---|
| **Name of entity** | **Reason** |
| PT. KB Valbury Sekuritas | Gain of controlling power |
| Korea Investment US Amazon Logistics Private Real Estate Investment Trust NO. 1 | Gain of controlling power |
| GVA Europe Real Estate Investment Trust No.2 | Gain of controlling power |
| Able Hagunri 1st Co., Ltd. | Controlling ownership interest |
| Able Hagunri 2nd Co., Ltd. | Controlling ownership interest |
| Newstar Gimpo 4th Co., Ltd. | Controlling ownership interest |
| Mobius 1st Co., Ltd. | Controlling ownership interest |
| HD Value 1st Co., Ltd. | Controlling ownership interest |
| Able iFood Co., Ltd. | Controlling ownership interest |
| Powerplay 1st Co., Ltd. | Controlling ownership interest |
| Able Wonsi 1st Co., Ltd. | Controlling ownership interest |
| Able Dosan 1st Co., Ltd | Controlling ownership interest |
| Able Eunhwasam 1st Co., Ltd | Controlling ownership interest |
| Newstar Gimpopoongmoo Co., Ltd. | Controlling ownership interest |
| Able Maseok 1st Co., Ltd. | Controlling ownership interest |
| TW Seocho 1st Co., Ltd. | Controlling ownership interest |
| TW Seocho 2nd Co., Ltd. | Controlling ownership interest |
| HJ Galaxy 1st Co., Ltd. | Controlling ownership interest |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | |
|:---|:---|
| **Name of entity** | **Reason** |
| HJ Galaxy 2nd Co., Ltd. | Controlling ownership interest |
| Newstar Wave 1st Co., Ltd. | Controlling ownership interest |
| Lamdamine 1st Co., Ltd. | Controlling ownership interest |
| Able Cheongdam 1st Co., Ltd | Controlling ownership interest |
| PT. Valbury Capital Management | Gain of controlling power |
| KB Star Galaxy Towers REIT | Gain of controlling power |
| Star Galaxy GP SRL | Gain of controlling power |
| Star Galaxy S.Comm | Gain of controlling power |
| Able Next 1st Co., Ltd | Controlling ownership interest |
| Able Dongil 1st Co., Ltd | Controlling ownership interest |
| KB Infra 3rd Co., Ltd. | Controlling ownership interest |
| Newstar Shiny 1st Co., Ltd. | Controlling ownership interest |
| Newstar Enerbil 1st Co., Ltd. | Controlling ownership interest |
| YSMC 1st Co., Ltd. | Controlling ownership interest |
| HJ Galaxy 3rd Co., Ltd. | Controlling ownership interest |
| KB SmartSchool 1st Co., Ltd. | Controlling ownership interest |
| Bighouse 7th Co., Ltd. | Controlling ownership interest |
| Newstar Energy 1st Co., Ltd. | Controlling ownership interest |
| Gyeongsan Logis 1st Co., Ltd | Controlling ownership interest |
| Stoke 2nd Corp | Controlling ownership interest |
| KB Samyoung Co., Ltd. | Controlling ownership interest |
| KB Global Contents Private Investment Fund | Gain of controlling power |
| Able Sungsoo 1st Co., Ltd. | Controlling ownership interest |
| Newstar Seongnam 1st Co., Ltd. | Controlling ownership interest |
| KPS Sihwa 1st Co., Ltd. | Controlling ownership interest |
| KB Baegun 1st Co., Ltd. | Controlling ownership interest |
| KB NY 1st Co., Ltd. | Controlling ownership interest |
| GDIC 2nd Co., Ltd. | Controlling ownership interest |
| Newstar NRB First Co., Ltd. | Controlling ownership interest |
| Able Dongtan 1st Co., Ltd. | Controlling ownership interest |
| Galaxy properties SA | Gain of controlling power |
| Newstar Gimpo 5th Co., Ltd. | Controlling ownership interest |
| GVA Europe Pre-IPO Private Investment Trust No.1 | Gain of controlling power |
| LIFE Global Reits Pre-IPO General Private Investment Trust 1 | Gain of controlling power |
| KB KBSTAR US Short-Term IG Corporate Bond ETF | Gain of controlling power |
| Newstar Everyday 1st Co., Ltd. | Controlling ownership interest |
| Cassiopeia 1st Co., Ltd. | Controlling ownership interest |
| Able Banpo 1st Co., Ltd. | Controlling ownership interest |
| Able Banpo 2nd Co., Ltd. | Controlling ownership interest |
| Able Gyeonggi Gwangju 1st Co., Ltd. | Controlling ownership interest |
| Newstar Byeongjeom 1st Co., Ltd. | Controlling ownership interest |
| Piggarden 1st Co., Ltd. | Controlling ownership interest |

---

*(b)* *Subsidiaries excluded from the consolidation* 

---

| | |
|:---|:---|
| **Name of entity** | **Reason** |
| Polar EH 1st Co., Ltd. | End of payment guarantee contract |
| Polar EH 2nd Co., Ltd. | End of payment guarantee contract |
| ABR Mareuk 1st Co., Ltd. | End of payment guarantee contract |
| Able Guwol 1st Co., Ltd. | End of payment guarantee contract |
| Newstar Gimpo 2nd Co., Ltd. | End of payment guarantee contract |
| Able Hyosung 1st Co., Ltd. | End of payment guarantee contract |
| Intgreen 1st Inc. | End of payment guarantee contract |
| Able Pocheon 1st Co., Ltd. | End of payment guarantee contract |
| Newstar Seotan Co., Ltd. | End of payment guarantee contract |
| Unbroken 1st Co., Ltd. | End of payment guarantee contract |
| Able Yongdap 1st Co., Ltd. | End of payment guarantee contract |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | |
|:---|:---|
| **Name of entity** | **Reason** |
|  Inspire Gold 1st Co., Ltd. | End of payment guarantee contract |
|  Y Three Ulsan Sinjeong 1st Co., Ltd. | End of payment guarantee contract |
|  498 Seventh KOR Holdco LP | Disposal |
|  498 Seventh KOR LLC | Disposal |
|  Multiasset PR Private Fund 4 | Disposal |
|  Enewstay 1st Co., Ltd. | End of payment guarantee contract |
|  Able Electronics 1st Co., Ltd. | End of payment guarantee contract |
|  KB PF 3rd Co., Ltd. | End of payment guarantee contract |
|  Able Cheongdam 1st Co., Ltd. | End of payment guarantee contract |
|  Able Hagunri 2nd Co., Ltd. | End of payment guarantee contract |
|  Newstar Panorama 1st Co., Ltd. | End of payment guarantee contract |
|  Heungkuk Global Highclass Private Real Estate Trust 23 | Disposal |
|  Korea Investment US Amazon Logistics Private Real Estate Investment Trust NO. 1 | Disposal |
|  Able Eunhwasam 1st Co., Ltd | End of payment guarantee contract |
|  MS Sejong 4th Co., Ltd. | End of payment guarantee contract |
|  AJH 3rd Co., Ltd. | End of payment guarantee contract |
|  Newstar Papyrus Co., Ltd. | End of payment guarantee contract |
|  Able Hyeongok Co., Ltd. | End of payment guarantee contract |
|  Mobius 1st Co., Ltd. | End of payment guarantee contract |
|  Able iFood Co., Ltd. | End of payment guarantee contract |
|  JOSH Bujeon 1st Co., Ltd. | End of payment guarantee contract |
|  Able Hagunri 1st Co., Ltd. | End of payment guarantee contract |
|  Yeoksam The Gallery KB 1st Co., Ltd. | End of payment guarantee contract |
|  KB Echo 1st Co., Ltd. | End of payment guarantee contract |
|  GDIC 1st Co., Ltd. | End of payment guarantee contract |
|  Newstar Ds 1st Co., Ltd. | End of payment guarantee contract |
|  KB Baegun 1st Co., Ltd. | End of payment guarantee contract |
|  Able Yucheon 1st Co., Ltd. | End of payment guarantee contract |
|  HJ Galaxy 1st Co., Ltd. | End of payment guarantee contract |
|  HJ Galaxy 2nd Co., Ltd. | End of payment guarantee contract |
|  KB Star Galaxy Towers REIT | Disposal |
|  Star Galaxy GP SRL | Disposal |
|  Star Galaxy S.Comm | Disposal |
|  Galaxy properties SA | Disposal |
|  GVA Europe Real Estate Investment Trust No.2 | Disposal |
|  DGB General Private Real Estate Investment Trust No.8 | Disposal |
|  LB UK Private Real Estate Investment Trust No.18 | Disposal |
|  LB UK Private Real Estate Investment Trust No.19 | Disposal |
|  Hillswood Finco Ltd. | Disposal |
|  Hillswood Holdings Ltd. | Disposal |
|  Hillswood Holding Property Unit Trust | Disposal |
|  Hillswood Property Unit Trust | Disposal |
|  Able Sungsoo 1st Co., Ltd. | End of payment guarantee contract |
|  KB Wise Star Real Estate Feeder Fund 2 | Disposal |
|  KB Wise Star Jongno Tower Real Estate Master Fund | Disposal |
|  KB Infra 1st Co., Ltd. | End of payment guarantee contract |
|  Newstar Everyday 1st Co., Ltd. | End of payment guarantee contract |
|  KB Illite 1st. Co., Ltd. | End of payment guarantee contract |
|  SJ Jongno 1st Co., Ltd. | End of payment guarantee contract |
|  Newstar Ds 2nd Co., Ltd | End of payment guarantee contract |
|  Able Gamsam 1st Co., Ltd. | End of payment guarantee contract |
|  Alpha Spain Real Estate Private Investment Trust 1 | Disposal |
|  KB UK Center 1st Co., Ltd. | End of payment guarantee contract |
|  KB Infra 3rd Co., Ltd. | End of payment guarantee contract |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**2. Significant Accounting Policies** 

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

**2.1 Basis of Preparation** 

The Group maintains its accounting records in Korean won and prepares statutory consolidated financial statements in the Korean language (Hangul) in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (Korean IFRS). The accompanying consolidated financial statements have been condensed, restructured and translated into English from the Korean language financial statements.

Certain information attached to the Korean language financial statements, but not required for a fair presentation of the Group's financial position, financial performance or cash flows, is not presented in the accompanying consolidated financial statements.

The consolidated financial statements of the Group have been prepared in accordance with Korean IFRS. These are the standards and related interpretations issued by the International Accounting Standards Board (IASB) that have been adopted by the Republic of Korea.

The consolidated financial statements have been prepared on the historical cost basis except for the following items:

*•* *Certain financial assets and liabilities (including derivatives instruments), certain classes of property, plant and equipment and investment properties measured at fair value* 

*•* *Assets held for sale measured at fair value less costs to sell, and* 

*•* *Defined benefit plans* 

*•* *Plan assets measured at fair value* 

The preparation of the consolidated financial statements requires the use of certain critical accounting estimates. Management also needs to exercise judgement in applying the Group's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 3.

**2.2 Changes in Accounting Policy and Disclosures** 

2.2.1 New and amended standards adopted by the Group

The Group has applied the following amended standards for the first time for its annual reporting period commencing January 1, 2022.

• *Amendments to Korean IFRS No. 1103 Business Combination – Reference to the Conceptual Framework* 

The amendments update a reference of definition of assets and liabilities to qualify for recognition in revised Conceptual Framework for Financial Reporting. However, the amendments add an exception for the recognition of liabilities and contingent liabilities within the scope of Korean IFRS No. 1037 *Provisions, Contingent Liabilities and Contingent Assets*, and Korean IFRS No. 2121 *Levies*. The amendments also confirm that contingent assets should not be recognized at the acquisition date. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. These amendments do not have a significant impact on the consolidated financial statements.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

• *Amendments to Korean IFRS No. 1016 Property, Plant and Equipment – Proceeds before intended use* 

The amendments prohibit an entity from deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while the entity is preparing the asset for its intended use. Instead, the entity will recognize the proceeds from selling such items, and the costs of producing those items, as profit or loss. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. These amendments do not have a significant impact on the consolidated financial statements.

• *Amendments to Korean IFRS No. 1037 Provisions, Contingent Liabilities and Contingent Assets – Onerous Contracts: Cost of Fulfilling a Contract* 

The amendments clarify that the direct costs of fulfilling a contract include both the incremental costs of fulfilling the contract and an allocation of other costs directly related to fulfilling contracts when assessing whether the contract is onerous. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. These amendments do not have a significant impact on the consolidated financial statements.

2.2.2 The following amended standards have been published that are not mandatory for December 31, 2022 reporting periods and have not been early adopted by the Group.

• Amendments to Korean IFRS No.1001 Presentation of Financial Statements—Classification of Liabilities as
Current or Non-current

The amendments clarify that liabilities are classified as either current or non-current, depending on the substantive rights that exist at the end of the reporting period. Classification is unaffected by the likelihood that an entity will exercise the right to defer settlement of the liability or the management's expectations thereof. Also, the settlement of liability includes the transfer of the entity's own equity instruments; however, it would be excluded if an option to settle the liability by the transfer of the entity's own equity instruments is recognized separately from the liability as an equity component of a compound financial instrument. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

• *Amendments to Korean IFRS No.1001 Presentation of Financial Statements – Accounting Policy Disclosure* 

The amendments require an entity to define and disclose their material accounting policy information. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

• *Amendments to Korean IFRS No.1001 Presentation of Financial Statements— Disclosure of gain or losses on valuation of financial liabilities subject to exercise price adjustment conditions* 

The amendments require disclosures about gains or losses on valuation occurred for the reporting period (but are limited to those included in profit or loss) for the conversion options or warrants (or financial liabilities with warrants), if all or part of the financial instrument whose exercise price is adjusted due to the issuers' stock price fluctuations, are classified as financial liabilities according to paragraph 11 of Korean IFRS No.1032 Financial Instruments: Presentation. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

• *Amendments to Korean IFRS No.1008 Accounting Policies, Changes in Accounting Estimates and Errors – Definition of Accounting Estimates* 

The amendments introduce the definition of accounting estimates and clarify how to distinguish changes in accounting estimates from changes in accounting policies. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

• *Amendments to Korean IFRS No.1012 Income Taxes – Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction* 

The amendments narrow the scope of the deferred tax recognition exemption so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

**2.3 Consolidation** 

The Group has prepared the consolidated financial statements in accordance with Korean IFRS No.1110 *Consolidated Financial Statements.*

(a) Subsidiaries

Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred is measured at the fair values of the assets transferred, and identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The Group recognizes any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest's proportionate share of the acquired entity's net identifiable assets. All other non-controlling interests are measured at fair values, unless otherwise required by other standards. Acquisition-related costs are expensed as incurred.

The Group applies the book-value method to account for business combinations of entities under a common control. Identifiable assets acquired and liabilities assumed in a business combination are measured at their book values on the consolidated financial statements of the ultimate parent entity. In addition, the difference between the sum of consolidated book values of the assets and liabilities transferred and accumulated other comprehensive income; and the consideration paid is recognized as capital surplus.

The excess of consideration transferred, amount of any non-controlling interest in the acquired entity and acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recoded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in the profit or loss as a bargain purchase.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Intergroup transactions, balances and unrealized gains on transactions between group companies are eliminated. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

(b) Associates

Associates are entities over which the Group has significant influence but not control or joint control. Investments in associates are accounted for using the equity method of accounting, after initially being recognized at cost. Unrealized gains on transactions between the Group and its associates are eliminated to the extent of the Group's interest in the associates. If the Group's share of losses of an associate equals or exceeds its interest in the associate (including long-term interests that, in substance, form part of the Group's net investment in the associate), the Group discontinues recognizing its share of further losses. After the Group's interest is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate.

If there is objective evidence of impairment for the investment in the associate, the Group recognizes the difference between the recoverable amount of the associate and its book amount as impairment loss.

If an associate uses accounting policies other than those of the Group for like transactions and events in similar circumstances, if necessary, adjustments shall be made to make the associate's accounting policies conform to those of the Group when the associate's financial statements are used by the Group in applying the equity method.

(c) Joint Arrangements

A joint arrangement, wherein two or more parties have joint control, is classified as either a joint operation or a joint venture. A joint operator has rights to the assets, and obligations for the liabilities, relating to the joint operation and recognizes the assets, liabilities, revenues and expenses relating to its interest in a joint operation. A joint-venturer has rights to the net assets relating to the joint venture and accounts for that investment using the equity method.

**2.4 Foreign Currency Translation** 

*(a) Functional and presentation currency* 

Items included in the financial statements of the Group are measured using the currency of the primary economic environment in which the Group operates ("the functional currency"). The financial statements are presented in Korean won, which is the Group's functional and presentation currency.

*(b) Transactions and balances* 

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in profit or loss. They are deferred in other comprehensive income if they relate to qualifying cash flow hedges and qualifying effective portion of hedge of net investments in foreign operations, or are attributable to monetary part of the net investment in a foreign operation.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation differences on non-monetary assets and liabilities such as equities held at fair value through profit or loss are recognized in profit or loss as part of the fair value gain or loss and translation differences on non-monetary assets such as equities classified as available-for-sale financial assets are recognized in other comprehensive income.

**2.5 Recognition and Measurement of Financial Instruments** 

2.5.1 Classification

The Group classifies financial assets as follows.

*•* *Those to be measured at fair value (through profit or loss or other comprehensive income)* 

*•* *Those to be measured at amortised cost* 

The classification depends on the Group's business model for managing the financial assets and the contractual terms of the cash flows.

For financial assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. For investments in debt instruments, this will depend on the business model in which the investment is held. The Group reclassifies debt investments when, and only when its business model for managing those assets changes.

For investments in equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income. Changes in fair value of non-designated equity investment are recognized in profit or loss.

2.5.2 Measurement

At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.

Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

2.5.2.1 Debt instruments

Subsequent measurement of debt instruments depends on the Group's business model for managing the asset and the cash flow characteristics of the asset. The Group classifies its debt instruments into one of the following three measurement categories:

(a) Amortised cost

Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognized in profit or loss when the asset is derecognized or impaired. Interest income from these financial assets is included in 'interest income' using the effective interest rate method.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

(b) Fair value through other comprehensive income

Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets' cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income. Movements in the carrying amount are taken through other comprehensive income, except for the recognition of impairment loss (reversal of impairment loss), interest income and foreign exchange gains and losses which are recognized in profit or loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss. Interest income from these financial assets is included in 'interest income' using the effective interest rate method. Foreign exchange gains and losses are presented in 'gain or loss on foreign currency transaction' and impairment losses are presented in 'loss on valuation and disposal of financial instrument'.

(c) Fair value through profit or loss

Assets that do not meet the criteria for amortised cost or fair value through other comprehensive income are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognized in profit or loss and presented net in the statement of profit or loss within 'gain or loss on valuation and disposal of financial instrument' in the year in which it arises.

2.5.2.2 Equity instruments

The Group subsequently measures all equity investments at fair value. Where the Group's management has elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment. Dividend income from such investments continue to be recognized in profit or loss when the right to receive payments is established.

Changes in the fair value of financial assets at fair value through profit or loss are recognized in 'gain or loss on valuation and disposal of financial instrument' in the statement of profit or loss. Impairment loss (reversal of impairment loss) on equity investments measured at fair value through other comprehensive income are not reported separately from other changes in fair value.

2.5.3 Impairment

The Group assesses on a forward-looking basis expected credit losses associated with its debt instruments carried at amortised cost and fair value through other comprehensive income. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

Expected credit losses are a probability-weighted estimate of credit losses (i.e. the present value of all cash shortfalls) over the expected life of the financial instrument. The Group measures expected credit losses by reflecting reasonable and supportable information that is reasonably available at the reporting date without undue cost or effort, including information about past events, current conditions and forecasts of future economic conditions.

The Group uses the following three measurement techniques in accordance with Korean IFRS:

*•* *General approach: for financial assets and off-balance-sheet unused credit line that are not applied below two approaches* 

*•* *Simplified approach: for receivables, contract assets and lease receivables* 

*•* *Credit-impaired approach: for purchased or originated credit-impaired financial assets* 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Different measurement approaches are applied depending on significant increase in credit risk. 12 month expected credit losses is recognized when credit risk has not significantly increased since initial recognition. A loss allowance at an amount equal to lifetime expected credit losses is recognized when credit risk has significantly increased since initial recognition. Lifetime is presumed to be a period to the contractual maturity date of a financial asset (the expected life of the financial asset).

The Group determines whether the credit risk has increased significantly since initial recognition using the following information. One or more of the following items is deemed significant increase in credit risk.

*•* *More than 30 days past due;* 

*•* *Decline in credit rating at period end by more than certain notches as compared to that at initial recognition;* 

*•* *Decline in ratings below certain level in the early warning system;* 

Under simplified approach, the Group shall always measure the loss allowance at an amount equal to lifetime expected credit losses. Under credit-impaired approach, the Group shall only recognize the cumulative changes in lifetime expected credit losses since initial recognition as a loss allowance for purchased or originated credit-impaired financial assets.

The Group generally deems one or more of the following items credit-impaired:

*•* *90 days or more past due;* 

*•* *Legal proceedings related to collection;* 

*•* *Refinancing;* 

*•* *Corporate borrowers that are rated C or D;* 

*•* *Debt restructuring.* 

2.5.3.1 Forward-looking information

The Group uses forward-looking information, when it determines whether the credit risk has increased significantly since initial recognition and measures expected credit losses.

The Group assumes the risk component has a certain correlation with the business cycle, and calculates the expected credit loss by reflecting the forward-looking information with macroeconomic variables on the measurement inputs.

Forward-looking information used in calculation of expected credit loss is derived after comprehensive consideration of a variety of factors including scenario in management planning, risk situation scenario for stress test, third party forecast, and others.

2.5.3.2 Measuring expected credit losses on financial assets at amortised cost

The amount of the loss on financial assets at amortised cost is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows discounted at the financial asset's original effective interest rate. The Group estimates expected future cash flows for financial assets that are individually significant (individual assessment of impairment).

For financial assets that are not individually significant, the Group collectively estimates expected credit loss by grouping loans with homogeneous credit risk profile (collective assessment of impairment).

• Individual assessment of impairment

Individual assessment of impairment losses are calculated using management's best estimate on present value of expected future cash flows. The Group uses all the available information including operating cash flow of the borrower and net realizable value of any collateral held.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

• Collective assessment of impairment

Collective assessment of loss allowance involves historical loss experience along with incorporation of forward-looking information. Such process incorporates factors such as type of collateral, product and borrowers, credit rating, size of portfolio and recovery period and applies 'probability of default' (PD) on a company of assets and 'loss given default' (LGD) by type of recovery method. Also, the expected credit loss model involves certain assumption to determine input based on loss experience and forward-looking information. These models and assumptions are periodically reviewed to reduce gap between loss estimate and actual loss experience.

2.5.3.3 Measuring expected credit losses on financial assets at fair value through other comprehensive income

Measuring method of expected credit losses on financial assets at fair value through other comprehensive income is equal to the method of financial assets at amortised cost, except for loss allowances that are recognized as other comprehensive income. Amounts recognized in other comprehensive income for sale or repayment of financial assets at fair value through other comprehensive income are reclassified to profit or loss.

2.5.4 Recognition and Derecognition

Regular way purchases and sales of financial assets are recognized or derecognized on trade-date, the date on which the Group commits to purchase or sell the asset. Financial assets are derecognized when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership.

If a transfer does not result in derecognition because the Group has retained substantially all the risks and rewards of ownership of the transferred asset, the Group continues to recognize the transferred asset in its entirety and recognizes a financial liability for the consideration received. The Group classified the financial liability as "borrowings" in the statement of financial position.

The Group writes off the carrying amount and allowance of financial assets in its entirety or to a portion thereof when the principal and interest are determined to be no longer recoverable. In general, the Group considers write-off when it is determined that the debtor does not have sufficient resources or income to cover the principal and interest, and this write-off decision is made in accordance with internal regulations.

2.5.5 Offsetting of financial instruments

Financial assets and liabilities are offset and the net amount reported in the statements of financial position where there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the assets and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Group or the counterparty.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.6 Financial Liabilities** 

2.6.1 Classification and Measurement

The Group's financial liabilities at fair value through profit or loss are financial instruments held for trading. A financial liability is held for trading if it is incurred principally for the purpose of repurchasing in the near term. A derivative that is not a designated as hedging instruments and an embedded derivative that is separated are also classified as held for trading.

The Group classifies non-derivative financial liabilities, except for financial liabilities at fair value through profit or loss, financial guarantee contracts and financial liabilities that arise when a transfer of financial assets does not qualify for derecognition, as financial liabilities carried at amortised cost and present as 'deposits liabilities', 'borrowings', and 'other financial liabilities' in the statement of financial position.

2.6.2 Derecognition

Financial liabilities are removed from the statement of financial position when it is extinguished; for example, when the obligation specified in the contract is discharged or canceled or expired or when the terms of an existing financial liability are substantially modified. The difference between the carrying amount of a financial liability extinguished or transferred to another party and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.

The Group's financial liabilities at fair value through profit or loss are financial instruments held for trading. A financial liability is held for trading if it is incurred principally for the purpose of repurchasing in the near term. A derivative that is not a designated as hedging instruments and an embedded derivative that is separated are also classified as held for trading. Financial liabilities designated the financial liabilities at fair value through profit or loss is the structured financial liabilities contain of embedded derivatives issued by the Group.

The changes in fair value of financial liabilities at FVTPL due to the change of credit risk is recognized as other comprehensive income(instead of profit and loss) and this other comprehensive income can not be transferred to profit and loss in subsequent events.

**2.7 Derivative Financial Instruments** 

The Group enters into numerous derivative financial instrument contracts such as stock options, stock swaps, interest rate swaps and others for trading purposes or sale and issue of derivative combined securities. These derivative financial instruments are presented as derivative financial instruments within the financial statements irrespective of transaction purpose and subsequent measurement requirement.

Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. The changes of the fair value of derivatives financial instruments held for trading are recognized in profit or loss as 'gain or loss on valuation and disposal of financial instrument'.

Fair value of derivative instrument traded in active market is a quoted price. In case of fair value of relatively simple derivative instruments such as options, interest rate or currency swaps and others is calculated using one or more valuation techniques like cash flow discount model, option pricing model which is based on observable data and appropriate considering the nature of objects.

Also, fair value of more complex derivative instrument is calculated using valuation techniques based on unobservable data in market is periodically reviewed and approved its accuracy.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

2.7.1 Day 1 Profit and Loss

Accordance with Korean IFRS, if there is no available price from active market and if the Group uses a valuation technique that uses data using unobservable valuation parameters from market for the fair value at initial recognition of financial instruments, there could be a difference between the transaction price and the amount determined using that valuation technique. In these circumstances, the fair value of financial instruments is recognized as the transaction price and the difference is amortised by using the straight line method over the life of the financial instruments.

2.7.2 Credit risk adjustments

In case of exchange-traded derivative instrument, credit risk is not reflected on the fair value because exchange-traded derivative instrument is traded in public exchange, and it is not available to identify certain counterparties. Fair value of OTC derivative instrument only reflects credit risk.

2.7.3 Hedge accounting

The accounting treatment of changes of fair value for the derivatives are varied as the character of hedging items and the purpose of hedging. The Group holds derivative contracts for the purpose of hedging the risk and the Group designates certain derivatives as hedging instruments to hedge the risk as follows.

*(a)* *Fair value hedge : a hedge of the exposure to changes in fair value of a recognised asset or liability or an unrecognised firm commitment* 

*(b)* *Cash flow hedge : a hedge of the exposure to variability in cash flows that is attributable to a particular risk associated with all, or a component of, a recognised asset or liability or a highly probable forecast transaction* 

*(c)* *Hedge of net investments in foreign operations* 

On initial designation of the hedge, the Group formally documents the relationship between the hedging instrument(s) and hedged items, including the risk management objectives and strategy in undertaking the hedge transaction, together with the methods that will be used to assess the effectiveness of the hedging relationship.

The fair value of derivatives for hedge is disclosed in note 37.

Changes in the fair value of a derivative hedging instrument designated as a fair value hedge are recognized in profit or loss. The gain or loss from remeasuring the hedging instrument at fair value for a derivative hedging instrument and the gain or loss on the hedged item attributable to the hedged risk are recognized in profit or loss

If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item is fully amortised to profit or loss by the maturity of the financial instrument using the effective interest method.

The accounting treatments of hedge of net investments in foreign operations are similar to the one of cash flow hedge.

If hedging instruments qualify for a hedge of net investments in foreign operations, the effective portion of changes in fair value of hedging instrument is recognized in other comprehensive income or loss and the ineffective portion is recognized in profit or loss. The gain or loss on the hedging instrument relating to the effective portion of the hedge that has been recognized in other comprehensive income will be reclassified from other comprehensive income or loss to profit or loss as a reclassification adjustment on the disposal or partial disposal of the foreign operation.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.8 Property and Equipment** 

All property and equipment except for land are recognized at its cost less any accumulated depreciation and any accumulated impairment losses. The cost of property and equipment includes any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management and the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

Land is measured at fair value on the basis of the valuation performed by an independent valuer. Revaluations are made with sufficient regularity to ensure that the carrying amount does not differ materially from that which would be determined using fair value at the end of the reporting period.

If an asset's carrying amount is increased as a result of a revaluation, the increase is recognized in other comprehensive income and the amount net of deferred tax is accumulated in equity under the heading of revaluation surplus after netting deferred tax. However, the increase is recognized in profit or loss to the extent that it reverses a revaluation decrease of the same asset previously recognized in profit or loss. If an asset's carrying amount is decreased as a result of a revaluation, the decrease is recognized in profit or loss. However, the decrease is recognized in other comprehensive income to the extent of any credit balance existing in the revaluation surplus in respect of that asset. The decrease recognized in other comprehensive income reduces the amount accumulated in equity under the heading of revaluation surplus. The revaluation surplus included in equity in respect of an item of property and equipment is transferred directly to retained earnings when the asset is derecognized.

Depreciation of all property and equipment, except for land, is calculated using the following method to allocate their cost or revalued amounts, net of their residual values, over their estimated useful lives as follows:

---

| | | |
|:---|:---|:---|
| **Property and equipment** | **Estimated useful lives** | **Depreciation method** |
| Buildings | 40 years | Straight-line method |
| Vehicles | 4 years | Straight-line method |
| Furniture and equipment | 4 years | Straight-line method |
| Other | 4 years | Straight-line method |
| Right-of-use assets | 1~10 years<br> (initial date of the contract<br> entered into ~ maturity date) | Straight-line method |

---

The residual value, the useful life and the depreciation method applied to an asset are reviewed at least at each financial year-end and, if needed, the changes are accounted for as a change in an accounting estimate.

**2.9 Investment Property** 

Property held to earn rentals or for capital appreciation or both is classified as investment property. Investment property is measured initially at its cost. After recognition as an asset, investment property is carried at cost less accumulated depreciation and impairment losses. Investment property, except for land, is depreciated using the straight-line method over their useful lives of 40 years.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.10 Intangible Assets** 

Intangible assets are measured initially at cost and subsequently carried at their cost less any accumulated amortization and any accumulated impairment losses.

Intangible assets, except for goodwill, comprise software and membership rights, and are amortised using the straight-line method with no residual value over following estimated useful economic life since the asset is available for use. However, goodwill and membership rights are not amortised by considering their useful life as indefinite, because there is no expectable limit to period for use.

---

| | | |
|:---|:---|:---|
| **Intangible assets** | **Estimated useful lives** | **Amortization method** |
| Development costs | 4 years | Straight-line method |
| Software | 4 years | Straight-line method |

---

The amortization period and the amortization method for intangible assets with a finite useful life are reviewed at the end of each financial year. The management reviews the useful life of intangible assets that is not being amortised each period to determine whether events and circumstances continue to support an indefinite useful life. If management judges that previous estimates should be adjusted, the change is accounted for as a change in an accounting estimate.

**2.11 Impairment of Non-financial Assets** 

Goodwill or intangible assets with indefinite useful lives are not subject to amortization and are tested annually for impairment. Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. Non-financial assets, other than goodwill, that suffered impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

**2.12 Lease** 

Lease income from operating leases where the Group is a lessor is recognized in income on a straight-line basis over the lease term. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying asset and recognized as expense over the lease term on the same basis as lease income. The respective leased assets are included in the statement of financial position based on their nature.

The Group should assess whether a contract is, or contains a lease at the date of the contract entered into and the initial application date under Korean IFRS No.1116. But the Group may elect not to reassess whether a contract is, or contains a lease for the contract entered into before the transition date by applying practical expedient permitted by Korean IFRS No.1116. The Group has gone through all the contract to assess whether the contract is, or contains, a lease at the contract entered into after the date of initial application.

A lessee is required to recognize a right-of-use assets (lease assets) representing its right to use the underlying leased asset and a lease liability representing its obligation to make lease payments. Assets and liabilities arising from a lease are initially measured on a present value basis.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Lease liabilities include the net present value of the following lease payments:

*•* *Fixed payments (including in-substance fixed payments), less any lease incentives receivable* 

*•* *Variable lease payment that are based on an index or a rate* 

*•* *Amounts expected to be payable by the lessee under residual value guarantees* 

*•* *The exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and* 

*•* *Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease* 

The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate can not be readily determined, the lessee's incremental borrowing rate is used, being the rate that the lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms and conditions.

Right-of-use assets are measured at cost comprising the following:

*•* *The amount of the initial measurement of lease liability* 

*•* *Any lease payments made at or before the commencement date less any lease incentives received* 

*•* *Any initial direct costs incurred by the lessee, and* 

*•* *An estimate of restoration costs* 

However, short-term lease (lease that, at the commencement date, has a lease term of 12 months or less) and lease of low-value assets (For example, underlying leased asset under $5,000) are permitted to elect exceptional conditions.

The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term.

Related to sale and leaseback, the Group (seller-lessee) is required to applying the Korean IFRS No.1115 '*Revenue from Contracts with Customers*' to determine whether the transfer of an asset is accounted for as a sale of that asset. However, the Group shall not reassess sale and leaseback transactions entered into before the date of initial application.

Large number of lease contracts held by the Group have extension option and termination option. These conditions are generally used for the maximizing the flexibility of lease operation in a view of managing the contracts. Extension option or termination option included in the lease contracts are generally owned by the Group, not lessor. The Group re-evaluated the lease term of the lease contracts by taking into account the contract type, operation plan for branch offices, and costs related to lease termination . As a result, no significant change in the existing lease term has occurred.

**2.13 Provisions** 

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation and the increase in the provision due to passage of time is recognized as interest expense.

**2.14 Financial Guarantee Contracts** 

Financial guarantees contracts provided by the Group are initially measured at fair value on the date the guarantee was given. Subsequent to initial recognition, the Group's liabilities under such guarantees are measured at the higher of the amounts below and recognized as 'other financial liabilities':

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Loss allowance in accordance with Korean IFRS No.1109, ' *Financial Instruments'* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The amount initially recognized less, when appropriate, the cumulative amount of income recognized in accordance
with the principles of Korean IFRS No.1115, ' *Revenue from Contracts with Customers* '

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.15 Revenue Recognition** 

The Group recognizes revenues in accordance with the following five-step revenue recognition standard (Korean IFRS No.1115 *Revenue from Contracts with Customers*).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 1: Identify the contract with a customer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 2: Identify the performance obligations in the contract.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 3: Determine the transaction price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 4: Allocate the transaction price to the performance obligations in the contract.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

**2.16 Employee Benefits** 

2.16.1 Retirement benefit liabilities: Defined benefit plans and Defined contribution plans

The Group has both defined benefit and defined contribution plans. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. The contributions are recognized as employee benefit expenses when an employee has rendered service. A defined benefit plan is a pension plan that is not a defined contribution plan.

Typically defined benefit plans define an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation. The liability recognized in the statement of financial position in respect of defined benefit pension plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds and that have terms to maturity approximating to the terms of the related pension obligation. The remeasurements of the net defined benefit liability are recognized in other comprehensive income.

If any plan amendments, curtailments, or settlements occur, past service costs or any gains or losses on settlement are recognized as profit or loss for the year.

2.16.2 Short-term employee benefits

Short-term employee benefits, which are expected to be settled wholly before 12 months after the end of the annual reporting period in which the employees render the service, are recognized in profit or loss at the undiscounted amount of short-term employee benefits expected to be paid in exchange for that service.

The expected cost of profit-sharing and bonus payments are recognized as liabilities when the Group has a present legal or constructive obligation to make such payments as a result of past events rendered by employees and a reliable estimate of the obligation can be made.

2.16.3 Share-based payment

The Group is under share-based payment arrangements that grant shares to the executives of the Group. When the arrangements are exercised, the Group provides share or cash equal to the monetary value of the share.

The Group measures the services acquired and the liability incurred at fair value, and the fair value is recognized as expense and accrued expenses over the vesting period. Until the liability is settled, the Group remeasures the fair value of the liability at the end of each reporting period and at the date of settlement, with any changes in fair value recognized in profit or loss as share-based payments.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.17 Income Tax Expenses** 

Income tax expense comprises current income tax and deferred income tax and are recognized in profit or loss for the year, except to the extent that the tax arises from (a) a transaction or event which is recognized either in other comprehensive income or directly in equity and (b) a business combination.

2.17.1 Current income tax

Current income tax is the amount of income taxes payable (recoverable) in respect of the taxable profit (tax loss) for a period. A difference between the taxable profit and accounting profit may arise when income or expense is included in accounting profit in one period but is included in taxable profit in a different period. Differences may also arise if there is revenue that is exempt from taxation or expenses that is not deductible in determining taxable profit (tax loss). Current income tax liabilities (assets) for the current and prior periods are measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

The Group offsets current income tax assets and current income tax liabilities if, and only if, the Group (a) has a legally enforceable right to set off the recognized amounts and (b) intends to settle on a net basis.

2.17.2 Deferred income tax

Deferred income tax is recognized, using the asset-liability method, on temporary differences arising between the tax based of assets and liabilities and their carrying amount in the financial statements. Deferred income tax liabilities are recognized for all taxable temporary differences and deferred income tax assets are recognized for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilized. However, deferred income tax liabilities are not recognized if they arise from the initial recognition of goodwill; deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit or loss.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except for deferred income tax liability where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference, will not reverse in the foreseeable future.

The carrying amount of a deferred income tax asset is reviewed at the end of each reporting period. The Group reduces the carrying amount of a deferred income tax asset to the extent that it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred income tax asset to be utilized.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred income tax liabilities and deferred income tax assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

Current income tax and deferred income tax are included in the calculation of income tax expense. Income taxes related to prior period are included in current income tax.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Deferred income taxes, recognized directly in equity or arisen from business combination, are directly deducted from equity or goodwill.

**2.18 Operating Segment Reporting** 

Operating segments are components of the Group, about which separate internal reporting information is evaluated regularly by the chief operating decision makers including board of directors in deciding how to allocate resources and to assess performance. Each segment is a strategic business unit that offers different products and services, and is managed separately because each business has different risks and opportunities, different technology required and marketing strategies.

Segment information includes the items which are directly attributable and reasonably allocated to the segment.

**2.19 Other Receivables and Payables Related to Brokerage Transactions** 

Regarding customer brokerage transactions, the Group recognizes the receivable from and payable to the Korea Exchange (Clearing and settlement organization) and customers in total amounts, which the Group recognizes as other financial assets and other financial liabilities. The Group offsets the receivable and payable that arise between Korea Exchange and the Group within the same day, and that arise between a customer and the Group within the same day and through the same account.

**2.20 Business Combinations** 

The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred is measured at the fair values of the assets transferred, and identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.

The Group applies the book-value method to account for business combinations of entities under a common control. Identifiable assets acquired and liabilities assumed in a business combination are measured at their book values on the consolidated financial statements of the ultimate parent entity. In addition, the difference between the sum of book values of the assets and liabilities transferred and accumulated other comprehensive income; and the consideration paid is recognized as capital surplus.

**2.21 Approval of Issuance of the Financial Statements** 

The issuance of the December 31, 2022 consolidated financial statements of the Group was approved by the Board of Directors on March 6, 2023, which is subject to change with approval at the annual shareholder's meeting.

**3. Critical Accounting Estimates and Assumptions** 

The preparation of financial statements requires the Group to make estimates and assumptions concerning the future. Management also needs to exercise judgement in applying the Group's accounting policies. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. As the resulting accounting estimates will, by definition, seldom equal the related actual results, it can contain a significant risk of causing a material adjustment.

The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below. Additional information of significant judgment and assumptions of certain items are included in relevant notes.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**3.1 Income taxes** 

The Group recorded, based on its best estimate, current taxes and deferred taxes that the Group will be liable in the future for the operating results at the end of the reporting period. However, the final tax outcome in the future may be different from the amounts that were initially recorded. Such differences will impact the current and deferred income tax assets and liabilities in the period in which such determination is made.

If certain portion of the taxable income is not used for investments or increase in wages in accordance with the Special Taxation for Facilitation of Investment and Mutually-Beneficial Cooperation, the Group is liable to pay additional income tax calculated based on the tax law. Accordingly, the measurement of current and deferred income tax is affected by the tax effects from the tax law. As the Group's income tax is dependent on the investments and increase in wages, there exists uncertainty with regard to measuring the final tax effects.

**3.2 Fair value of financial instruments** 

The fair value of financial instruments where no active market exists or where quoted prices are not otherwise available is determined by using valuation techniques. Financial instruments, which are not actively traded in the market and those with less transparent market prices, will have less objective fair values and require broad judgment on liquidity, concentration, uncertainty in market factors and assumptions in price determination and other risks.

As described in Note 2.5, 'Recognition and Measurement of Financial Instruments', diverse valuation techniques are used to determine the fair value of financial instruments, from generally accepted market valuation models to internally developed valuation models that incorporate various types of assumptions and variables.

**3.3 Impairment of financial assets** 

In accordance of Korean IFRS No.1109, the provision for impairment for financial assets are based on assumptions about risk of default and expected loss rates. The Group uses judgment in making these assumptions and selecting the inputs to the impairment calculation based on the Group's past history, existing market conditions as well as forward-looking estimates at the end of each reporting period (Note 2.5).

**3.4 Measurement of defined benefit obligation** 

The present value of the defined benefit liability depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost (income) for pensions include the discount rate. Any changes in these assumptions will impact the carrying amount of the defined benefit liability. The Group determines the appropriate discount rate at the end of the reporting period. This is the interest rate that is used to determine the present value of estimated future cash outflows expected to be required to settle the defined benefit liability. In determining the appropriate discount rate, the Group considers the interest rates of high-quality corporate bonds that are denominated in the currency in which the pension benefits will be paid, and that have terms to maturity approximating to the terms of the related pension liability. Other key assumptions for defined benefit liability are based in part on current market conditions.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**4. Segment Information** 

4.1 Types of services from which each reportable segment derives its revenues

Management of the Group decides operating segment based on the information, which is to be reported to the Group's chief executive officer, in order to allocate resources to the segment and evaluate performance of the segment. The Group's operating segments consist of brokerage and wealth management, investment banking, trading and other business.

In accordance with Korean IFRS No.1108, reporting segments of the Group by type of services categories are as follows:

---

| | |
|:---|:---|
| **Reporting segment** | **Main business activities** |
| Brokerage and wealth management | Sales and services relating to wealth management and brokerage provided to individuals, corporations and institutional investors |
| Investment banking | Underwriting and advisory services related to bond issuance, structured finance, initial public offering, and mergers and acquisition |
| Trading | Trading of securities and derivatives, and proprietary trading |
| Others | Other services and support services |

---

4.2 Revenue and income of segment reporting

Financial information by operating segment for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* |
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Operating**<br> **income** | **Operating**<br> **expense** | **Operating**<br> **profit (loss)** | **Non-operating**<br> **income(expense)** | **Income tax<br>expense(income)** | **Profit(loss) for<br>the year** |
|  Brokerage and wealth management | 2408296357 | 2259020997 | 149275360 | (19539482) | 3876679 | 125859199 |
|  Investment banking | 1002087699 | 868341524 | 133746175 | 70922603 | (424484) | 205093262 |
|  Trading | 10665451383 | 10786517633 | (121066250) | 2688303 |  | (118377947) |
|  Others<sup>1</sup> | 194187118 | 111147155 | 83039963 | (36739819) | 64046996 | (17746852) |
|  | 14270022557 | 14025027309 | 244995248 | 17331605 | 67499191 | 194827662 |
|  <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. |
| *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* |
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Operating**<br> **income** | **Operating**<br> **expense** | **Operating**<br> **profit** | **Non-operating**<br> **income(expense)** | **Income tax<br>expense** | **Profit(loss) for<br>the year** |
|  Brokerage and wealth management | 1876590453 | 1526877616 | 349712837 | (4282084) | 3238863 | 342191890 |
|  Investment banking | 670323268 | 389625460 | 280697808 | 32438352 | 3894106 | 309242054 |
|  Trading | 5813364712 | 5733921862 | 79442850 | (9527949) | 13481 | 69901420 |
|  Others<sup>1</sup> | 189272066 | 77851248 | 111420818 | (21858988) | 210605778 | (121043948) |
|  | 8549550499 | 7728276186 | 821274313 | (3230669) | 217752228 | 600291416 |

---

<sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation.

The above reported operating income is generated from external customers and inter-segment transactions, and expense includes expenses that can be directly attributed or reasonably allocated to each segment including internal interests. Segment profit represents the profit earned by each segment, reported to the chief executive officer to determine the allocation of resources and to measure the respective segments' performance.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

4.3 Assets and liabilities of segments

Total assets and liabilities by each segment as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
|  | **2022** | **2022** |
| *(in thousands of Korean won)* | **Total assets** | **Total liabilities** |
|  Brokerage and wealth management | 8033999999 | 6815076741 |
|  Investment banking | 4906240013 | 2289794909 |
|  Trading | 24196618231 | 18931136515 |
|  Others | 16680551089 | 19912610608 |
|  | 53817409332 | 47948618773 |

---

---

| | | |
|:---|:---|:---|
|  | **2021** | **2021** |
| *(in thousands of Korean won)* | **Total assets** | **Total liabilities** |
|  Brokerage and wealth management | 7301547473 | 8598279396 |
|  Investment banking | 4001269431 | 1710091571 |
|  Trading | 29113741003 | 20800704765 |
|  Others | 15014237509 | 18886164067 |
|  | 55430795416 | 49995239799 |

---

4.4 Information on principal customers

No single customer contributed 10% or more to the Group's revenue for the years ended December 31, 2022 and 2021.

**5. Cash and Deposits** 

The details of cash and deposits as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Cash and cash equivalents** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash on hand | 14217 | 173 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash in foreign currency | 120717 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Demand deposits | 736305237 | 149590806 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Checking deposit | 12052931 | 2000976 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign currency deposits | 365559515 | 504695901 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Certificates of deposit | 39298100 | 8298500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MMDA | 86530578 | 9712212 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accommodation notes | 4747856 | 1555452 |
|  | 1244629151 | 675854020 |
|  **Deposits** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits for securities subscription | 1007522 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reserve for claims of customers' deposits | 457235271 | 351745802 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantee deposits for securities lending and borrowing | 120336120 | 95528832 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits for exchange-traded derivatives | 1139399469 | 821697818 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantee deposits for KSFC trading | 2513154 | 2114517 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Long-term deposits | 602713044 | 1088255761 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Restricted due from financial institutes | 42500 | 39000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 970345187 | 799445549 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Allowances for credit losses of deposits | (645224) | (632624) |
|  | 3292947043 | 3158194655 |
|  | 4537576194 | 3834048675 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Restricted deposits as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Deposits for securities subscription <sup>1</sup> | 1007522 |  |
|  Reserve for claims of customers' deposits <sup>2</sup> | 457235271 | 351745802 |
|  Guarantee deposits for securities lending and borrowing <sup>3</sup> | 120336120 | 95528832 |
|  Deposits for exchange-traded derivatives <sup>4</sup> | 1139399469 | 821697818 |
|  Guarantee deposits for KSFC trading <sup>5</sup> | 2513154 | 2114517 |
|  Long-term deposits <sup>6</sup> | 569000000 | 778799807 |
|  Restricted due from financial institutes <sup>7</sup> | 42500 | 39000 |
|  Others <sup>8</sup> | 970345187 | 799445549 |
|  | 3259879223 | 2849371325 |

---

<sup>1</sup> Subscription deposits are subscription margin of investors and the Group that are separately deposited at Korea Securities Finance Corporation(KSFC) or other relevant financial institutions until due date for payment for the subscription of the newly issued or sold securities in accordance with the provisions of Article 4-44 of the Regulation on Financial Investment Business. 

<sup>2</sup> The reserve for claims of customers' deposits is deposited separately in a form of trust in KSFC to meet the demands of investors, such as return of deposit and others, in accordance with Article 74 of the Financial Investment Services and Capital Markets Act.

<sup>3</sup> Deposited in Korea Securities Depository to guarantee for securities lending and borrowing.

<sup>4</sup> The deposits for exchange-traded derivatives that the investors and the Group pay for foreign futures option trading to KEB Hana Bank and Forex Dealer Member.

<sup>5</sup> In the case of an investor's loan transaction, a certain portion of the price of securities sold is deposited at KSFC as margin.

<sup>6</sup> Pledged deposits provided for securities lending and borrowing, repurchase agreements between institutions and retail payment through investment & securities companies are included.

<sup>7</sup> Guarantee deposits for checking accounts

<sup>8</sup> Deposits in foreign currency and others consist of the margin accounts for trading financial instruments in foreign markets and deposits to court.

Changes in allowances for credit losses of deposits for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
|  | **12-month**<br> **expected**<br> **credit losses** | **12-month**<br> **expected**<br> **credit losses** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
| *(in thousands of Korean won)* | **12-month**<br> **expected**<br> **credit losses** | **12-month**<br> **expected**<br> **credit losses** | **Non-Impaired** | **Impaired** |
|  Beginning |  | 632624 |  |  |
|  Provision |  | 12598 |  |  |
|  Others (foreign exchange and etc.) |  | 2 |  |  |
|  |  | 645224 |  |  |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
|  | **12-month**<br> **expected**<br> **credit losses** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
| *(in thousands of Korean won)* | **12-month**<br> **expected**<br> **credit losses** | **Non-Impaired** | **Impaired** |
|  Beginning | 739569 |  |  |
|  Reversal of provision | (105375) |  |  |
|  Others (foreign exchange and etc.) | (1570) |  |  |
|  | 632624 |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**6. Financial Instruments at FVTPL** 

The details of financial instruments at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Financial Assets at FVTPL** | **Financial Assets at FVTPL** | **Financial Liabilities at FVTPL** | **Financial Liabilities at FVTPL** |
| *(in thousands of Korean won)* | **2022** | **2021** | **2022** | **2021** |
|  Financial assets required to be<br> mandatorily measured at FVTPL | 29549677944 | 34182334301 | 2082979265 | 2825922918 |
|  Financial assets designated at FVTPL |  |  | 10088600213 | 9160923652 |
|  | 29549677944 | 34182334301 | 12171579478 | 11986846570 |

---

6.1 Financial assets required to be mandatorily measured at FVTPL

The details of financial assets required to be mandatorily measured at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Deposits** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reserve for claims of customers' deposits (trust) <sup>1</sup> | 4531756555 | 5704580963 |
|  **Equity instruments** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks | 676021174 | 498608397 |
|  **Debt instruments** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and local government bonds | 4092627487 | 5292775017 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Special bonds | 1793814905 | 2498873337 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds | 4093880890 | 8318369010 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate commercial papers | 5196584584 | 4170294875 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Asset-backed short-term bonds | 2345571118 | 1490591859 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hybrid bond with security-like features | 229833526 | 110295800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment in partnerships | 440156234 | 334361963 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Collective investment securities | 3563298865 | 2846352569 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hybrid stock with bond-like features | 148375859 | 134027729 |
|  **Loans** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Privately placed bonds | 42604988 | 173459362 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loan receivables | 1884215 | 1907034 |
|  **Derivative linked securities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity-linked securities | 31899039 | 41493507 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other derivative linked securities | 331528412 | 139326096 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other OTC derivative combined contract | 236574425 | 114887471 |
|  **Securities in foreign currency** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks in foreign currency | 42399169 | 14529061 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bonds in foreign currency | 788520400 | 1352049465 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment in partnerships in foreign currency | 43983023 | 25840354 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Collective investment securities in foreign currency | 229349884 | 260551771 |
|  **Collective fund for default loss** | 82667524 | 73273475 |
|  **Hybrid bonds** | 606272079 | 585355259 |
|  **Exchange traded notes** | 73589 | 529927 |
|  | 29549677944 | 34182334301 |

---

<sup>1</sup> The reserve for claims of customers' deposits is restricted to use because this reserve is deposited separately in a form of trust in KSFC to meet the demands of investors, such as return of deposit and others, in accordance with Article 74 of the Financial Investment Services and Capital Markets Act. Among the reserve for claims of customers' deposits deposited in a form of trust in KSFC, beneficiaries amount to W98,000 million are provided as a collateral for the payment to Kookmin Bank which is an agent bank of payment, in accordance with Article 72 Clause 3 of the Financial Investment Services and Capital Markets Act. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Details of securities sold which are classified as financial liabilities at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Equity Securities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks | 428935822 | 509897766 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Collective investment securities | 2268236 | 3056061 |
|  Debt Securities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and local government bonds | 1651775207 | 2282891241 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Special bonds |  | 30077850 |
|  | 2082979265 | 2825922918 |

---

The details of financial assets pledged as collateral as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of*<br> *Korean won)* | **Description** | **2022** | **2021** | **Security right**<br> **holder** |
| Financial assets at FVTPL | Guarantee deposits for lending and borrowing securities and bonds | 7063541100 | 9294924447 | Korea Securities<br> Depository, etc. |
|  | Margin required and guarantee deposits for derivatives trading | 1129757669 | 955030966 | Korea Stock Exchange, etc. |
|  | Guarantee deposits for clearing fund | 1458725 | 1653330 | Korea Securities<br> Depository |
|  | Guarantee deposits for reverse repurchase agreements | 3724891983 | 8422134434 | Customer, Institution |
| Financial assets at FVOCI | Guarantee deposits for lending and borrowing securities and bond | 1592460037 | 1523592569 | Korea Securities<br> Depository, etc. |
|  | Guarantee deposits for derivatives trading | 136701325 |  | Hana Securities Co., Ltd., etc. |
|  | Guarantee deposits for reverse repurchase agreements | 2234882535 | 1990336464 | Customer, Institution |
| Other Financial Assets | Guarantee deposits for lending and borrowing securities and bonds | 47850000 |  | KSFC |
|  |  | 15931543374 | 22187672210 |  |

---

(\*) As at December 31, 2022 and 2021, the accrued interests related to debt securities provided as collateral of W 228,578 million and W 279,423 million, respectively, are excluded.

The Group provides W 4,986,339 million and W 6,165,555 million of its borrowing securities held as collateral to KSFC and others as at December 31, 2022 and 2021, respectively.

As at December 31, 2022 and 2021, the fair values of collaterals sold or repledged as collateral regardless of default are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Securities** | **Securities** | **Securities** | **Securities** |
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Fair value of collateral held |  | 771983450 |  | 488172002 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

6.2 Financial liabilities designated at FVTPL

The details of financial liabilities designated at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* |  |  |
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Derivative linked securities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity-linked securities | 6804836388 | 6252543366 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other derivative linked securities | 1636774811 | 1972278390 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other OTC derivative combined contract | 1611301701 | 899164069 |
|  **Exchange traded notes** | 35687313 | 36937827 |
|  | 10088600213 | 9160923652 |

---

The differences between the contractual value to be paid at maturity and the carrying amount of financial liabilities at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Contractual value to be paid at maturity | 9973339575 | 8957601834 |
|  Carrying amount | 10088600213 | 9160923652 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Differences | (115260638) | (203321818) |

---

Accumulated changes in fair value of financial liabilities at FVTPL due to the change of credit risk as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
|  | **Other comprehensive income recognized<br>from changes of fair value due to the change<br>of credit risk (before tax) <sup>1</sup>** | **Other comprehensive income recognized<br>from changes of fair value due to the change<br>of credit risk (before tax) <sup>1</sup>** |
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning of the year | (3070045) | 15846655 |
|  Change of fair value | (52822291) | (18916700) |
|  End of the year | (55892336) | (3070045) |

---

<sup>1</sup> The Group assessed OCI based on the probability of default corresponding to the Group's credit rating and loss given default. The amount is before tax. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**7. Derivatives and Hedge Accounting** 

Derivatives owned by the Group as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Assets** | **Assets** | **Liabilities** | **Liabilities** | |
| *(in thousands of Korean won)* | **Hedging** | **Trading** | **Hedging** | **Trading** | **Unsettled amount** |
|  **Exchange-traded derivatives** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 765348 |  | 256477 | 2343711058 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 37455359 |  | 89623607 | 1805532521 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase options |  | 58416888 |  |  | 1642156435 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written options |  |  |  | 330682246 | 2408934407 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 36107 |  | 2364335 | 363267744 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goods: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 1969714 |  | 940729 | 28576813 |
|  |  | 98643416 |  | 423867394 | 8592178978 |
|  **OTC derivatives** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 699505103 |  | 585959569 | 9274000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 103770321 |  | 262238369 | 139330656724 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 8032470 |  | 8906536 | 830000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 242992102 | 11193570 | 162136418 | 9375928575 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 17764588 | 422620 | 14626867 | 726824375 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 21446632 |  | 438473 | 595631000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 377840090 |  | 492274693 | 6649734899 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase options |  | 107414599 |  |  | 1446151498 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written options |  |  |  | 28591489 | 1747432558 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Credit: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 32859630 |  | 17468307 | 3006113907 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goods |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 887437 |  | 885284 | 131500117 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 13153870 |  | 313466501 | 909001211 |
|  |  | 1625666842 | 11616190 | 1886992506 | 174022974864 |
|  |  | 1724310258 | 11616190 | 2310859900 | 182615153842 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Assets** | **Assets** | **Liabilities** | **Liabilities** | |
| *(in thousands of Korean won)* | **Hedging** | **Trading** | **Hedging** | **Trading** | **Unsettled amount** |
|  **Exchange-traded derivatives** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 1903458 |  | 2464302 | 4616641898 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 14338186 |  | 6529579 | 1585281541 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase options |  | 51905242 |  |  | 1412231541 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written options |  |  |  | 188099589 | 2423244090 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 464226 |  | 877434 | 359457571 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goods: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 42891 |  | 81769 | 6370216 |
|  |  | 68654003 |  | 198052673 | 10403226857 |
|  **OTC derivatives** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 125452803 |  | 136232672 | 3684000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 55032397 |  | 79573686 | 135999784725 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 5121493 |  | 4809190 | 1010000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 147949552 | 16338320 | 115995239 | 13696294964 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 6900127 | 915127 | 12190618 | 512493576 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 2400866 |  |  | 165970000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 322887583 |  | 132618848 | 5207198079 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase options |  | 43280731 |  |  | 1748428964 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written options |  |  |  | 53270931 | 2024447957 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Credit: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 18979327 |  | 7408651 | 2588958733 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 20859425 |  | 117235787 | 1601240180 |
|  |  | 748864304 | 17253447 | 659335622 | 168238817178 |
|  |  | 817518307 | 17253447 | 857388295 | 178642044035 |

---

The Group entered into the derivative contracts for hedging fair value change of the foreign exchanges and hedge of net investments in foreign operations accounting for foreign currency risk of a foreign operation.

Gain or loss on hedge of net investments in foreign operations for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Gain(loss) on the hedging instrument | (16003726) | (18044880) |
|  Effective portion of changes in fair value of hedging (other comprehensive income) | (16003726) | (18044880) |
|  Ineffective portion of changes in fair value of hedging (profit or loss) |  |  |

---

The effective portion of changes in fair value of hedge of net investments in foreign operations recognized as other comprehensive income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Other comprehensive income | (16003726) | (18044880) |
|  Reclassification form other comprehensive income to net income | 8429967 |  |
|  Tax effect | 1823373 | 4962342 |
|  Other comprehensive income-net of tax | (5750386) | (13082538) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The average price condition for the nominal future cash flow related to hedge of net investments in foreign operations as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of*<br> *Korean won)* | **2022** | **2022** | **2022** | **2022** |
|  | The nominal<br>amount of<br> the hedging<br>instrument | Average price<br>condition(KRW/USD,<br>Korean won) | Average price<br>condition(KRW/GBP,<br>Korean won) | Average price<br>condition(KRW/EUR,<br>Korean won) |
|  1 year | 79875690 | 1071.00 |  | 1312.78 |
|  2 year | 27498060 |  | 1465.26 |  |
|  3 year |  |  |  |  |
|  Over 3 year | 204035300 | 1178.92 |  |  |
|  | 311409050 | 1152.84 | 1465.26 | 1312.78 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of*<br> *Korean won)* | **2021** | **2021** | **2021** | **2021** |
|  | The nominal<br>amount of<br> the hedging<br>instrument | Average price<br>condition(KRW/USD,<br>Korean won) | Average price<br>condition(KRW/GBP,<br>Korean won) | Average price<br>condition(KRW/EUR,<br>Korean won) |
|  1 year | 257606000 | 1113.44 | 1465.26 |  |
|  2 year | 14765740 |  |  | 1312.78 |
|  3 year | 22705493 |  | 1558.67 |  |
|  Over 3 year | 100767500 | 1172.73 |  |  |
|  | 395844733 | 1131.56 | 1506.43 | 1312.78 |

---

**8. Financial Assets at FVOCI** 

The details of financial assets at FVOCI as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Equity instruments** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks <sup>1</sup> | 420330275 | 365576095 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment in partnerships | 1200000 | 1200000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other | 264586560 | 78876642 |
|  **Debt instruments** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and local government bonds | 5025406 | 20989065 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Special bonds | 690761850 | 549741426 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds | 3194758699 | 2698701899 |
|  **Securities in foreign currency** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt instruments | 222182668 | 123213103 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment in partnerships | 1708780 | 1579576 |
|  | 4800554238 | 3839877806 |

---

<sup>1</sup> Equity investment on Korea Stock Exchange and other relative institutions

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Changes in gains and losses on valuation of financial assets at FVOCI (before tax) for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Valuation<sup>1</sup>** | **Disposal**<br> **/ Transfer** | **Ending**<br> **balance** |
|  Stocks | 318760788 | 54754180 |  | 373514968 |
|  Government and local government bonds | 1768 | (194598) | (3010) | (195840) |
|  Special bonds | (3852333) | (746312) | 1944438 | (2654207) |
|  Corporate bonds | (14256566) | (15405862) | 6104383 | (23558045) |
|  Securities in foreign currency | (915931) | (5390112) | 141511 | (6164532) |
|  Other Securities in Won currency | (1125111) | (21775311) |  | (22900422) |
|  | 298612615 | 11241985 | 8187322 | 318041922 |

---

<sup>1</sup> Provision for credit loss of debt instruments at FVOCI of W 2 million and reversal of provision for credit loss of debt instruments at FVOCI of W 477 million are excluded.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Valuation<sup>1</sup>** | **Disposal**<br> **/ Transfer** | **Ending**<br> **balance** |
|  Stocks | 278961566 | 39799222 |  | 318760788 |
|  Government and local government bonds | (44428) | 1768 | 44428 | 1768 |
|  Special bonds | 107785 | (3839248) | (120870) | (3852333) |
|  Corporate bonds | 3046331 | (16055846) | (1247051) | (14256566) |
|  Securities in foreign currency | 1609775 | (1083912) | (1441794) | (915931) |
|  Other Securities in Won currency | 356906 | (1482017) |  | (1125111) |
|  | 284037935 | 17339967 | (2765287) | 298612615 |

---

<sup>1</sup> Provision for credit loss of debt instruments at FVOCI of W 598 million is excluded.

There are no equity investments at FVOCI derecognized for the year ended December 31, 2022.

The dividend income from equity investments at FVOCI for the years ended December 31, 2022 and 2021, are as follows;

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Derecognised** | **Held at the<br>reporting<br>period** | **Held at the<br>reporting<br>period** | **Derecognised** | **Held at the<br>reporting<br>period** | **Held at the<br>reporting<br>period** |
|  Equity investments at FVOCI |  |  |  |  |  |  |
|  Non marketable securities |  |  | 9536521 |  |  | 7411793 |
|  Other equity investments |  |  | 8493303 |  |  | 2668697 |

---

The Group recognized provision for credit loss of debt instruments at FVOCI amount (before tax) to W 1,004 million and W 1,479 million, as at December 31, 2022 and 2021, respectively.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**9. Investments in Associates** 

Investments in associates as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of*<br> *Korean won)* |  |  |  | **Percentage<br>of<br>ownership<br>(%)** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
|  | **Location** | **Industry** | **Closing<br>month** | **Percentage<br>of<br>ownership<br>(%)** | **Acquisition<br>cost** | **Net asset<br>amount** | **Book<br>amount** | **Acquisition<br>cost** | **Net asset<br>amount** | **Book<br>amount** |
|  Wise Asset Management Co., Ltd. <sup>1</sup> | Korea | Asset Mgt. |  | 33 | 4629876 |  |  | 4629876 |  |  |
|  KB Special Purpose Acquisition Company No.17 <sup>2</sup> | Korea | SPAC |  |  |  |  |  | 500 | 955 | 955 |
|  KB Special Purpose Acquisition Company No.18 <sup>2</sup> | Korea | SPAC |  |  |  |  |  | 1000 | 1955 | 1955 |
|  KB Special Purpose Acquisition Company No.19 <sup>2</sup> | Korea | SPAC |  |  |  |  |  | 1000 | 1906 | 1906 |
|  KB Special Purpose Acquisition Company No.20 <sup>2</sup> | Korea | SPAC |  |  |  |  |  | 1000 | 1913 | 1913 |
|  KB Special Purpose Acquisition Company No.21 <sup>2</sup> | Korea | SPAC | November | 0.13 | 10000 | 20053 | 20053 |  |  |  |
|  KB Special Purpose Acquisition Company No.22 <sup>2</sup> | Korea | SPAC | November | 0.19 | 10000 | 19767 | 19767 |  |  |  |
|  KB Special Purpose Acquisition Company No.23 <sup>2</sup> | Korea | SPAC | November | 0.08 | 5000 | 10060 | 10060 |  |  |  |
|  KB Special Purpose Acquisition Company No.24 <sup>2</sup> | Korea | SPAC | November | 1.67 | 25000 | 57197 | 57197 |  |  |  |
|  KB New Paradigm Agriculture Venture Fund | Korea | Investment | December | 25 | 2100000 | 2976845 | 2976845 | 2725000 | 2940867 | 2940867 |
|  KB KONEX Market Vitalization Fund | Korea | Investment | December | 23.44 | 615000 | 7301375 | 7301375 | 615000 | 5445338 | 5445338 |
|  KB-KDBC New Technology Business Investment Fund | Korea | Investment | December | 33.33 | 1800000 | 2988748 | 2988748 | 4400000 | 5894529 | 5894529 |
|  KBTS Technology Venture Private Equity Fund <sup>2</sup> | Korea | Investment | December | 16 | 2784000 | 3941180 | 3941180 | 4080000 | 4808098 | 4808098 |
|  KB-SJ Tourism Venture Fund <sup>2</sup> | Korea | Investment | December | 18.52 | 4600000 | 3773125 | 3773125 | 5000000 | 4146315 | 4146315 |
|  KB Shinjasanaubo Fund <sup>2</sup> | Korea | Investment | December | 14.67 | 1804000 | 1810764 | 1810764 | 1936000 | 1897195 | 1897195 |
|  UNION Media Commerce Fund | Korea | Investment | December | 28.99 | 1000000 | 956728 | 956728 | 1000000 | 958907 | 958907 |
|  KB-Brain KOSDAQ Scale-Up Fund <sup>2</sup> | Korea | Investment | December | 15.96 | 4950000 | 6675432 | 6675432 | 9750000 | 11125821 | 11125821 |
|  KB SPROTT Renewable Private Equity Fund I <sup>2</sup> | Korea | Investment | December | 7.69 | 3682135 | 3374650 | 3374650 | 1182775 | 954286 | 954286 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  KB-Stonebridge Secondary Private Equity Fund <sup>2</sup> | Korea | Investment | December | 4.16 | 6800355 | 7184026 | 7184026 | 6183416 | 6270906 | 6270906 |
|  KB-SP Private Equity Fund IV <sup>2</sup> | Korea | Investment | December | 14.95 | 6100000 | 1892224 | 1892224 | 6100000 | 5627717 | 5627717 |
|  KB-UTC Inno-Tech Venture Fund <sup>2</sup> | Korea | Investment | December | 14.76 | 7125000 | 6393024 | 6393024 | 7125000 | 6990821 | 6990821 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund <sup>2</sup> | Korea | Investment | December | 6 | 5003207 | 6276963 | 6276963 | 6696000 | 7626992 | 7626992 |
|  Project Vanilla Co., Ltd. | Korea | System<br> software<br> development |  |  |  |  |  | 2450000 | 525344 | 525344 |
|  December & Company Inc. <sup>2</sup> | Korea | System<br> software<br> development | December | 16.73 | 30000000 | 3735016 | 16028831 | 30000000 | 9053043 | 21388370 |
|  KB Material and Parts No. 1 PEF <sup>2</sup> | Korea | Investment | December | 14.47 | 3400000 | 3320637 | 3320637 | 3400000 | 3342698 | 3342698 |
|  KB Bio Private Equity Fund III Ltd. | Korea | Investment |  |  |  |  |  | 10000000 | 9950054 | 9950054 |
|  KB Global Commerce Private Equity Investment Fund <sup>2</sup> | Korea | Investment | December | 16.28 | 7000000 | 6219107 | 6219107 | 7000000 | 6820331 | 6820331 |
|  KB-KTB Technology Venture Fund <sup>2</sup> | Korea | Investment | December | 18.18 | 6000000 | 5806248 | 5806248 | 2000000 | 1983162 | 1983162 |
|  KB Bio Global Expansion Private Equity Fund No.1 | Korea | Investment | December | 39.47 | 15000000 | 15779019 | 15779019 | 15000000 | 14967033 | 14967033 |
|  KB Digital Platform Fund <sup>2</sup> | Korea | Investment | December | 16.67 | 9500000 | 9055919 | 9055919 | 4500000 | 4499746 | 4499746 |
|  KB-SOLIDUS Healthcare Investment Fund <sup>2</sup> | Korea | Investment | December | 4.9 | 1100000 | 1036176 | 1036176 | 100000 | 100000 | 100000 |
|  G Payment Joint Stock Company | Vietnam | Electronic<br> payment &<br> settlement<br> agency | December | 43.84 | 9028760 | 2916905 | 9282131 | 9028760 | 3174609 | 9350182 |
|  498 Seventh Owners LLC <sup>3</sup> | USA | Investment |  |  |  |  |  | 166851037 |  |  |
|  KB-GeneN Medical Venture Fund 1 | Korea | Investment | December | 22.52 | 2000000 | 1964512 | 1964512 |  |  |  |
|  KB-BridgePole Venture Investment Fund <sup>2</sup> | Korea | Investment | December | 6.3 | 850000 | 834741 | 834741 |  |  |  |
|  KB-Kyobo New Mobility Power Fund | Korea | Investment | December | 28.57 | 3000000 | 2826264 | 2826264 |  |  |  |
|  DA-Friend Investment Fund II | Korea | Investment | December | 27.06 | 987633 | 948652 | 948652 |  |  |  |
|  Cornerstone Pentastone IV Fund | Korea | Investment | December | 21.52 | 817742 | 792174 | 792174 |  |  |  |
|  SKS-VLP Fund No.2 | Korea | Investment | December | 23.11 | 1155560 | 1121399 | 1121399 |  |  |  |
|  JS Private Equity Fund III | Korea | Investment | December | 20.48 | 1700000 | 1664180 | 1664180 |  |  |  |
|  Mirae Asset Mobility<br> Investment Fund I | Korea | Investment | December | 22.99 | 2000000 | 1979241 | 1979241 |  |  |  |
|  KB-FT 1st Green Growth Investment Fund <sup>2</sup> | Korea | Investment | December | 10.34 | 2000000 | 1969650 | 1969650 |  |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  THE CHAEUL FUND NO.1 (former SKS IB NEW M&T FUND NO.1) | Korea | Investment | December | 31.25 | 1000000.0 | 989491.0 | 989491.0 |  |  |  |
|  POSITIVE Sobujang Venture Fund No.1 | Korea | Investment | December | 43.96 | 2000000.0 | 1977209.0 | 1977209.0 |  |  |  |
|  KB-NP Green ESG New Technology Venture Capital Fund <sup>2</sup> | Korea | Investment | December | 11.59 | 3740000.0 | 3617183.0 | 3617183.0 |  |  |  |
|  Hisstory 2022 Fintech Fund | Korea | Investment | December | 34.78 | 2000000.0 | 1980701.0 | 1980701.0 |  |  |  |
|  PEBBLES-MW M.C.E New Technology Investment Fund 1st | Korea | Investment | December | 23.26 | 2000000.0 | 1981813.0 | 1981813.0 |  |  |  |
|  KB Star REIT | Korea | Investment | December | 26.94 | 134772782.0 | 136323142.0 | 136323142.0 |  |  |  |
|  KB Bio Private Equity Investment Fund IV | Korea | Investment | December | 24.19 | 7500000.0 | 7492209.0 | 7492209.0 |  |  |  |
|  Nextrade Co., Ltd. <sup>2</sup> | Korea | Investment | December | 6.64 | 9700000.0 | 9700000.0 | 9700000.0 |  |  |  |
|  |  |  |  |  | 222046568.0 | 281683749.0 | 300342790.0 | 311756364 | 119110541 | 137621441 |

---

<sup>1</sup> The Group recognized the entire book amount as a loss before the year ended December 31, 2020, as a big loss was expected. Disposal of securities are restricted due to stock lock-up requirements as at December 31, 2022. 

<sup>2</sup> Although the ownership of the Group is less than 20%, these are included as associates, since the Group has a significant influence over investee's policy and operations. 

<sup>3</sup> This investment was reclassified to disposal group held for sale as at December 31, 2021

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Changes in investments in associates for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | Dividends | Disposal | Re-<br>classification | **Changes in<br>equity of<br>associates** | **Profit (loss)<br>of<br>associates** | **Ending**<br> **balance** |
|  KB Special Purpose Acquisition Company No.17 | 955 |  |  | (955) |  |  |  |  |
|  KB Special Purpose Acquisition Company No.18 | 1955 |  |  | (1955) |  |  |  |  |
|  KB Special Purpose Acquisition Company No.19 | 1906 |  |  | (1906) |  |  |  |  |
|  KB Special Purpose Acquisition Company No.20 | 1913 |  |  | (1913) |  |  |  |  |
|  KB Special Purpose Acquisition Company No.21 |  | 10000 |  | (9379) |  | 19915 | (483) | 20053 |
|  KB Special Purpose Acquisition Company No.22 |  | 10000 |  | (7909) |  | 19361 | (1685) | 19767 |
|  KB Special Purpose Acquisition Company No.23 |  | 5000 |  | (4265) |  | 9962 | (637) | 10060 |
|  KB Special Purpose Acquisition Company No.24 |  | 25000 |  |  |  | 32388 | (191) | 57197 |
|  KB New Paradigm Agriculture Venture Fund | 2940867 |  |  | (625000) |  |  | 660978 | 2976845 |
|  KB KONEX Market Vitalization Fund | 5445338 |  |  |  |  |  | 1856037 | 7301375 |
|  KB-KDBC New Technology Business Investment Fund | 5894529 |  |  | (2600000) |  |  | (305781) | 2988748 |
|  KBTS Technology Venture Private Equity Fund | 4808098 |  |  | (1296000) |  |  | 429082 | 3941180 |
|  KB-SJ Tourism Venture Fund | 4146315 |  |  | (400000) |  |  | 26810 | 3773125 |
|  KB Shinjasanaubo Fund | 1897195 |  |  | (132000) |  |  | 45569 | 1810764 |
|  UNION Media Commerce Fund | 958907 |  |  |  |  |  | (2179) | 956728 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  KB-Brain KOSDAQ Scale-Up Fund | 11125821 |  |  | (4800000) |  | 349611 | 6675432 |
|  KB SPROTT Renewable Private Equity Fund I | 954286 | 2499360 |  |  |  | (78996) | 3374650 |
|  KB-Stonebridge Secondary Private Equity Fund | 6270906 | 1248439 | (573020) | (631500) |  | 869201 | 7184026 |
|  KB-SP Private Equity Fund IV | 5627717 |  |  |  |  | (3735493) | 1892224 |
|  KB-UTC Inno-Tech Venture Fund | 6990821 |  |  |  |  | (597797) | 6393024 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 7626992 | 660000 |  | (2352793) |  | 342764 | 6276963 |
|  Project Vanilla Co., Ltd. | 525344 |  |  | (525344) |  |  |  |
|  December & Company Inc. | 21388370 |  |  | (49239) | 42904 | (5353204) | 16028831 |
|  KB Material and Parts No. 1 PEF | 3342698 |  | (34000) |  |  | 11939 | 3320637 |
|  KB Bio Private Equity Fund III Ltd. | 9950054 |  | (6027919) | (3922135) |  |  |  |
|  KB Global Commerce Private Equity Investment Fund | 6820331 |  |  |  |  | (601224) | 6219107 |
|  KB-KTB Technology Venture Fund | 1983162 | 4000000 |  |  |  | (176914) | 5806248 |
|  KB Bio Global Expansion Private Equity Fund No.1 | 14967033 |  |  |  |  | 811986 | 15779019 |
|  KB Digital Platform Fund | 4499746 | 5000000 |  |  |  | (443827) | 9055919 |
|  KB-SOLIDUS Healthcare Investment Fund | 100000 | 1000000 |  |  |  | (63824) | 1036176 |
|  G Payment Joint Stock Company | 9350182 |  |  |  | 296406 | (364457) | 9282131 |
|  KB-GeneN Medical Venture Fund 1 |  | 2000000 |  |  |  | (35488) | 1964512 |
|  KB-BridgePole Venture Investment Fund |  | 850000 |  |  |  | (15259) | 834741 |
|  KB-Kyobo New Mobility Power Fund |  | 3000000 |  |  |  | (173736) | 2826264 |
|  Apollo REIT PropCo LLC |  | 19968049 |  | (19968049) |  |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  DA-Friend Investment Fund II <sup>1</sup> |  |  |  |  | 987633 |  | (38981) | 948652.0 |
|  Cornerstone Pentastone IV Fund <sup>1</sup> |  |  |  |  | 817742 |  | (25568) | 792174.0 |
|  SKS-VLP Fund No.2 <sup>1</sup> |  |  |  |  | 1155560 |  | (34161) | 1121399.0 |
|  JS Private Equity Fund III |  | 1700000 |  |  |  |  | (35820) | 1664180.0 |
|  Mirae Asset Mobility Investment Fund I |  | 2000000 |  |  |  |  | (20759) | 1979241.0 |
|  KB-FT 1st Green Growth Investment Fund |  | 2000000 |  |  |  |  | (30350) | 1969650.0 |
|  THE CHAEUL FUND NO.1 (former SKS IB NEW M&T FUND NO.1) |  | 1000000 |  |  |  |  | (10509) | 989491.0 |
|  POSITIVE Sobujang Venture Fund No.1 |  | 2000000 |  |  |  |  | (22791) | 1977209.0 |
|  Hisstory 2022 Fintech Fund |  | 2000000 |  |  |  |  | (19299) | 1980701.0 |
|  PEBBLES-MW M.C.E New Technology Investment Fund 1st |  | 2000000 |  |  |  |  | (18187) | 1981813.0 |
|  KB-NP Green ESG New Technology Venture Capital Fund |  | 3740000 | (89) |  |  |  | (122728) | 3617183.0 |
|  KB Star Galaxy REIT |  | 134772782 |  |  |  | (2931330) | 4481690 | 136323142.0 |
|  KB Bio Private Equity Investment Fund IV |  | 7500000 |  |  |  |  | (7791) | 7492209.0 |
|  Nextrade Co., Ltd. |  | 9700000 |  |  |  |  |  | 9700000.0 |
|  | 137621441 | 208688630 | (6635028) | (37330342) | 2960935 | (2510394) | (2452452) | 300342790.0 |

---

<sup>1</sup> This investment is reclassified from financial assets measured at FVTPL for the year ended December 31, 2022.

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | Dividends | Disposal | Re-<br>classification | **Changes in<br>equity of<br>associates** | **Profit (loss)<br>of<br>associates** | **Ending**<br> **balance** |
|  KB Special Purpose Acquisition Company No.17 | 959 |  |  |  |  | (12) | 8 | 955 |
|  KB Special Purpose Acquisition Company No.18 | 1958 |  |  |  |  |  | (3) | 1955 |
|  KB Special Purpose Acquisition Company No.19 | 1914 |  |  |  |  |  | (8) | 1906 |
|  KB Special Purpose Acquisition Company No.20 | 1911 |  |  |  |  |  | 2 | 1913 |
|  KB Private Equity Fund III | 93893 |  | (80872) | (13021) |  |  |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  Keystone-Hyundai Sec. No.1 Private Equity Fund | 1556346 |  | (511575) | (1044771) |  |  |  |  |
|  KB New Paradigm Agriculture Venture Fund | 4922012 |  |  | (2275000) |  |  | 293855 | 2940867 |
|  KB KONEX Market Vitalization Fund | 9745342 |  |  | (5550000) |  |  | 1249996 | 5445338 |
|  KB-KDBC Pre-IPO New Technology Business Investment Fund | 8020843 |  |  | (2400000) |  |  | 273686 | 5894529 |
|  KBTS Technology Venture Private Equity Fund | 5037119 | 880000 |  | (1536000) |  |  | 426979 | 4808098 |
|  KB-SJ Tourism Venture Fund | 4133510 | 500000 |  |  |  |  | (487195) | 4146315 |
|  KB Shinjasanaubo Fund | 1317089 | 880000 |  | (264000) |  |  | (35894) | 1897195 |
|  UNION Media Commerce Fund | 959811 |  |  |  |  |  | (904) | 958907 |
|  KB-Brain KOSDAQ Scale-Up Fund | 10317253 | 3750000 |  | (4050000) |  |  | 1108568 | 11125821 |
|  KB SPROTT Renewable Private Equity Fund I | 1029697 |  |  |  |  |  | (75411) | 954286 |
|  KB-Stonebridge Secondary Private Equity Fund | 4753133 | 3788000 | (2827038) | (1692584) |  |  | 2249395 | 6270906 |
|  KB-SP Private Equity Fund IV | 5949785 |  |  |  |  |  | (322068) | 5627717 |
|  KB-UTC Inno-Tech Venture Fund | 5666113 | 1695000 |  | (375000) |  |  | 4708 | 6990821 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 2805442 | 3846000 |  |  |  |  | 975550 | 7626992 |
|  JR GLOBAL REIT <sup>1</sup> | 215854340 |  | (6605143) | (58419857) | (150829340) |  |  |  |
|  Project Vanilla Co., Ltd. | 2150514 |  |  |  |  |  | (1625170) | 525344 |
|  December & Company Inc. | 24401295 |  |  |  |  | 492279 | (3505204) | 21388370 |
|  KB Material and Parts No. 1 PEF | 3370557 |  | (34000) |  |  |  | 6141 | 3342698 |
|  KB Bio Private Equity Fund III Ltd. |  | 10000000 |  |  |  |  | (49946) | 9950054 |
|  K The fifteenth Real Estate Investment Trust |  | 8600000 |  | (8600000) |  |  |  |  |
|  KB Global Commerce Private Equity Investment Fund |  | 7000000 |  |  |  |  | (179669) | 6820331 |
|  KB-KTB Technology Venture Fund |  | 2000000 |  |  |  |  | (16838) | 1983162 |
|  KB Bio Global Expansion Private Equity Fund No.1 |  | 15000000 |  |  |  |  | (32967) | 14967033 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  KB Digital Platform Fund |  | 4500000.0 |  |  |  |  | (254) | 4499746 |
|  KB-SOLIDUS Healthcare Investment Fund |  | 100000.0 |  |  |  |  |  | 100000 |
|  G Payment Joint Stock Company |  | 9028760.0 |  |  |  | 655449 | (334027) | 9350182 |
|  498 Seventh Owners LLC <sup>2</sup> |  | 166851037.0 | (3482501) |  | (169424284) | 6055748 |  |  |
|  | 312090836 | 238418797.0 | (13541129) | (86220233) | (320253624) | 7203464 | (76670) | 137621441 |

---

<sup>1</sup> This investment was reclassified to financial assets measured at FVTPL due to the sales of some portion for the year ended December 31, 2021.

<sup>2</sup> This investment was reclassified to the disposal group held for sale for the year ended December 31, 2021.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Summarized financial information of the associates as at and for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Assets** | **Liabilities** | **Equity** | **Operating<br>Revenue** | **Profit (loss)<br>for the period** | **Total<br>comprehensive<br>Income(loss)** |
|  KB Special Purpose Acquisition Company No.21 | 17265672 | 1805081 | 15460591 |  | (104191) | (104191) |
|  KB Special Purpose Acquisition Company No.22 | 12020318 | 1701873 | 10318445 |  | (7882) | (7882) |
|  KB Special Purpose Acquisition Company No.23 | 14294351 | 1970660 | 12323691 |  | (4383) | (4383) |
|  KB Special Purpose Acquisition Company No.24 | 9999746 | 6567905 | 3431841 |  | (11451) | (11451) |
|  KB New Paradigm Agriculture Venture Fund | 12305600 | 398220 | 11907380 | 3882008 | 2643913 | 2643913 |
|  KB KONEX Market Vitalization Fund | 31377573 | 225366 | 31152207 | 9710508 | 7919092 | 7919092 |
|  KB-KDBC New Technology Business Investment Fund | 9225850 | 259568 | 8966282 | 1698596 | (917341) | (917341) |
|  KBTS Technology Venture Private Equity Fund | 30347103 | 5714728 | 24632375 | 1042936 | 2681763 | 2681763 |
|  KB-SJ Tourism Venture Fund | 20926320 | 551394 | 20374926 | 719109 | 144771 | 144771 |
|  KB Shinjasanaubo Fund | 12499930 | 153811 | 12346119 | 658870 | 310696 | 310696 |
|  UNION Media Commerce Fund | 3318493 | 17778 | 3300715 |  | (7518) | (7518) |
|  KB-Brain KOSDAQ Scale-Up Fund | 42537663 | 704909 | 41832754 | 11851369 | 2190892 | 2190892 |
|  KB SPROTT Renewable Private Equity Fund I | 44879342 | 995827 | 43883515 | 138 | (1026947) | (1026947) |
|  KB-Stonebridge Secondary Private Equity Fund | 172978705 | 348626 | 172630079 | 22444501 | 20886877 | 20886877 |
|  KB-SP Private Equity Fund IV | 13432211 | 776022 | 12656189 | 5553 | (24984937) | (24984937) |
|  KB-UTC Inno-Tech Venture Fund | 44111359 | 809263 | 43302096 |  | (4049078) | (4049078) |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 102827078 | 497814 | 102329264 | 21469658 | 5712736 | 5712736 |
|  December & Company Inc. | 35601450 | 13270926 | 22330524 | 868117 | (32001912) | (32001912) |
|  KB Material and Parts No. 1 PEF | 22953419 | 1955 | 22951464 | 451111 | 82525 | 82525 |
|  KB Global Commerce Private Equity Investment Fund | 38315044 | 111960 | 38203084 | 5907 | (3693236) | (3693236) |
|  KB-KTB Technology Venture Fund | 32214753 | 280389 | 31934364 | 133987 | (973025) | (973025) |
|  KB Bio Global Expansion Private Equity Fund No.1 | 40079295 | 105781 | 39973514 | 2465319 | 2057031 | 2057031 |
|  KB Digital Platform Fund | 55090257 | 754741 | 54335516 | 263891 | (2662958) | (2662958) |
|  KB-SOLIDUS Healthcare Investment Fund | 21483037 | 345040 | 21137997 | 13907 | (1302003) | (1302003) |
|  G Payment Joint Stock Company | 10176916 | 3523392 | 6653524 | 3400666 | (831333) | (831333) |
|  KB-GeneN Medical Venture Fund 1 | 8770415 | 47983 | 8722432 | 1299 | (157568) | (157568) |
|  KB-BridgePole Venture Investment Fund | 13330305 | 72656 | 13257649 | 4162 | (242352) | (242352) |
|  KB-Kyobo New Mobility Power Fund | 9931624 | 39699 | 9891925 | 1656 | (608075) | (608075) |
|  DA-Friend Investment Fund II | 3526439 | 20502 | 3505937 | 58 | (144063) | (144063) |
|  Cornerstone Pentastone IV Fund | 3704358 | 23170 | 3681188 | 250 | (118813) | (118813) |
|  SKS-VLP Fund No.2 | 4855380 | 2219 | 4853161 | 566 | (147839) | (147839) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  JS Private Equity Fund III | 8125609.0 | 495 | 8125114.0 | 388 | (174886) |
|  Mirae Asset Mobility Investment Fund I | 8682721.0 | 73023 | 8609698.0 | 9255 | (90302) |
|  KB-FT 1st Green Growth Investment Fund | 19051437.0 |  | 19051437.0 | 4748 | (293563) |
|  THE CHAEUL FUND NO.1 (former SKS IB NEW M&T FUND NO.1) | 3166370.0 |  | 3166370.0 |  | (33630) |
|  POSITIVE Sobujang Venture Fund No.1 | 4521087.0 | 22937 | 4498150.0 | 639 | (51850) |
|  KB-NP Green ESG New Technology Venture Capital Fund | 31837965.0 | 637590 | 31200375.0 | 18534 | (1058605) |
|  Hisstory 2022 Fintech Fund | 5694516.0 |  | 5694516.0 | 250 | (55484) |
|  PEBBLES-MW M.C.E New Technology Investment Fund 1st | 8562125.0 | 40329 | 8521796.0 | 322 | (78204) |
|  KB Star Galaxy REIT | 1098631387.0 | 588956071 | 509675316.0 | 25232718 | 16637141 |
|  KB Bio Private Equity Investment Fund IV | 31000301.0 | 32504 | 30967797.0 | 301 | (32202) |
|  Nextrade Co., Ltd. | 146100005.0 |  | 146100005.0 |  |  |

---

Summarized financial information of associates for which financial information is not available as at December 31, 2022 are excluded.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2021** | **December 31, 2021** | **December 31, 2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Assets** | **Liabilities** | **Equity** | **Operating<br>Revenue** | **Profit (loss)<br>for the period** | **Total<br>comprehensive<br>Income(loss)** |
|  KB Special Purpose Acquisition Company No.17 | 11974917 | 1542330 | 10432587 |  | 86837 | 86837 |
|  KB Special Purpose Acquisition Company No.18 | 17410086 | 2117458 | 15292628 |  | (21971) | (21971) |
|  KB Special Purpose Acquisition Company No.19 | 9158626 | 961254 | 8197372 |  | (34031) | (34031) |
|  KB Special Purpose Acquisition Company No.20 | 13890288 | 1451405 | 12438883 |  | 14741 | 14741 |
|  KB New Paradigm Agriculture Venture Fund | 12094989 | 331522 | 11763467 | 1617565 | 1175418 | 1175418 |
|  KB KONEX Market Vitalization Fund | 23315388 | 82273 | 23233115 | 8144773 | 5333316 | 5333316 |
|  KB-KDBC Pre-IPO New Technology Business Investment Fund | 18068890 | 385268 | 17683622 | 529527 | 821056 | 821056 |
|  KBTS Technology Venture Private Equity Fund | 35279435 | 5228823 | 30050612 | 2093762 | 2668615 | 2668615 |
|  KB-SJ Tourism Venture Fund | 22947296 | 557141 | 22390155 | 170143 | (2630850) | (2630850) |
|  KB Shinjasanaubo Fund | 12942679 | 7256 | 12935423 | 127355 | (244730) | (244730) |
|  UNION Media Commerce Fund | 3318493 | 10260 | 3308233 |  | (3118) | (3118) |
|  KB-Brain KOSDAQ Scale-Up Fund | 69942815 | 220953 | 69721862 | 14244262 | 6947028 | 6947028 |
|  KB SPROTT Renewable Private Equity Fund I | 13885890 | 1467103 | 12418787 | 330 | (980352) | (980352) |
|  KB-Stonebridge Secondary Private Equity Fund | 151003629 | 315806 | 150687823 | 55571834 | 54052960 | 54052960 |
|  KB-SP Private Equity Fund IV | 37645651 | 4525 | 37641126 | (1357783) | (2154157) | (2154157) |
|  KB-UTC Inno-Tech Venture Fund | 47847776 | 496602 | 47351174 | 1080275 | 31887 | 31887 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 127960429 | 843902 | 127116527 | 20594269 | 16259169 | 16259169 |
|  Project Vanilla Co., Ltd. | 1283040 | 210910 | 1072130 | 158 | (3240504) | (3240504) |
|  December & Company Inc. | 71218592 | 17275345 | 53943247 | 3981614 | (20766009) | (20766009) |
|  KB Material and Parts No. 1 PEF | 23103939 |  | 23103939 | 451280 | 42445 | 42445 |
|  KB Bio Private Equity Fund III Ltd. | 81691268 | 100822 | 81590446 | 4434 | (409554) | (409554) |
|  KB Global Commerce Private Equity Investment Fund | 41896320 |  | 41896320 | 2291 | (1103680) | (1103680) |
|  KB-KTB Technology Venture Fund | 11008216 | 100827 | 10907389 | 8481 | (92611) | (92611) |
|  KB Bio Global Expansion Private Equity Fund No.1 | 38031914 | 115430 | 37916484 | 91107 | (83516) | (83516) |
|  KB Digital Platform Fund | 27000148 | 1674 | 26998474 | 148 | (1526) | (1526) |
|  KB-SOLIDUS Healthcare Investment Fund | 2040000 |  | 2040000 |  |  |  |
|  G payment Joint Stock Company | 7797085 | 555733 | 7241352 | 818790 | (761924) | (761924) |

---

Summarized financial information of associates for which financial information is not available as at December 31, 2021 are excluded.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The fair value of marketable Investments in associates as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** |
|  | **Market<br>value** | **Market<br>value** | **Carrying<br>amount** | **Carrying<br>amount** |
|  KB Special Purpose Acquisition Company No.21 |  | 19800 |  | 20053 |
|  KB Special Purpose Acquisition Company No.22 |  | 19850 |  | 19767 |
|  KB Special Purpose Acquisition Company No.23 |  | 9900 |  | 10060 |
|  |  | 49550 |  | 49880 |

---

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** |
|  | **Market<br>value** | **Carrying<br>amount** |
|  KB Special Purpose Acquisition Company No.17 | 1000 | 955 |
|  KB Special Purpose Acquisition Company No.18 | 2035 | 1955 |
|  KB Special Purpose Acquisition Company No.19 | 2065 | 1906 |
|  KB Special Purpose Acquisition Company No.20 | 2060 | 1913 |
|  | 7160 | 6729 |

---

**10. Loans Measured at Amortised Cost** 

The details of loans measured at amortised cost as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Total amount** | **Allowances** | **Book amount** |
|  Retails |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Broker's loans | 3001361497 | (5309305) | 2996052192 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans to employees | 11975968 |  | 11975968 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Present value discount | (25619) |  | (25619) |
|  | 3013311846 | (5309305) | 3008002541 |
|  Corporate |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Broker's loans | 301209350 |  | 301209350 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities purchased under repurchase agreements | 730100000 |  | 730100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans receivable | 4734348931 | (52232538) | 4682116393 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchased loans | 133078510 | (3538136) | 129540374 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Advances for customers | 7564877 | (7564877) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Privately placed bonds | 29583500 | (299446) | 29284054 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial lease receivables | 35135664 |  | 35135664 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net deferred origination fees and costs | (4820171) |  | (4820171) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Present value discount | (3064593) |  | (3064593) |
|  | 5963136068 | (63634997) | 5899501071 |
|  | 8976447914 | (68944302) | 8907503612 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Total amount** | **Allowances** | **Book amount** |
|  Retails |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Broker's loans | 3141043225 | (29651) | 3141013574 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans to employees | 15067486 |  | 15067486 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Present value discount | (25619) |  | (25619) |
|  | 3156085092 | (29651) | 3156055441 |
|  Corporate |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Broker's loans | 270439064 |  | 270439064 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities purchased under repurchase agreements | 442100000 |  | 442100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans receivable | 3135425896 | (36433068) | 3098992828 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchased loans | 122776789 | (33697663) | 89079126 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Advances for customers | 11404578 | (11404578) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Privately placed bonds | 98528167 | (742527) | 97785640 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial lease receivables | 41127430 |  | 41127430 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net deferred origination fees and costs | (5222467) |  | (5222467) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Present value discount | (4148880) |  | (4148880) |
|  | 4112430577 | (82277836) | 4030152741 |
|  | 7268515669 | (82307487) | 7186208182 |

---

The changes in in book amount of loans measured at amortised cost for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2022 | 2022 | 2022 | 2022 | 2022 | 2022 |
|  | **Retails** | **Retails** | **Retails** | **Retails** | **Corporates** | **Corporates** | **Corporates** | **Corporates** |
|  | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime<br>expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime<br>expected**<br>**credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** |
|  | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **Non-impaired** | **Impaired** |  |  | **Non-impaired** | **Impaired** |  |
|  Beginning | 3156055442 |  | 29651 |  | 4004190706 | 59000000 | 49239871 |  |
|  Transfer between stages |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected credit Losses (Non-impaired) |  |  |  |  | (10000000) | 10000000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected credit Losses (Impaired) |  |  |  |  | (6675000) |  | 6675000 |  |
|  Write-off |  |  |  |  |  |  | (33202354) |  |
|  Sales |  |  |  |  | (722881522) |  |  |  |
|  Business Combination | 9444665 |  |  |  | 21064759 |  |  |  |
|  Other changes (recover, etc.) | (157497567) |  | 5279655 |  | 2629080340 | (39000000) | (4355732) |  |
|  Ending | 3008002540 |  | 5309306 |  | 5914779283 | 30000000 | 18356785 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 |
|  | **Retails** | **Retails** | **Retails** | **Retails** | **Corporates** | **Corporates** | **Corporates** | **Corporates** |
|  | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime<br>expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime<br>expected**<br>**credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** |
|  |  | **Non-impaired** | **Impaired** |  |  | **Non-impaired** | **Impaired** |  |
|  Beginning | 2735835157 |  | 26029 |  | 3843579468 | 84724768 | 49306827 |  |
|  Transfer between stages |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to 12-month expected credit losses |  |  |  |  | 7010483 | (7010483) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected credit losses |  |  |  |  |  |  |  |  |
|  Sale |  |  |  |  | (137590000) |  |  |  |
|  Other changes (recover, etc.) | 420220285 |  | 3622 |  | 291190755 | (18714285) | (66956) |  |
|  Ending | 3156055442 |  | 29651 |  | 4004190706 | 59000000 | 49239871 |  |
| <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: | <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: | <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: | <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: | <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: | <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: | <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: | <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: | <br> The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows: |
| *(in thousands of Korean won)* | 2022 | 2022 | 2022 | 2022 | 2022 | 2022 | 2022 | 2022 |
|  | **Retails** | **Retails** | **Retails** | **Retails** | **Corporates** | **Corporates** | **Corporates** | **Corporates** |
|  | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime<br>expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime<br>expected**<br>**credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** |
|  | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **Non-impaired** | **Impaired** |  |  | **Non-impaired** | **Impaired** |  |
|  Beginning |  |  | 29651 |  | 30678488 | 2567841 | 49031507 |  |
|  Transfer between stages |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected credit Losses (Non-impaired) |  |  |  |  | (138398) | 138398 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected credit Losses (Impaired) |  |  |  |  | (3461509) |  | 3461509 |  |
|  Write-off |  |  |  |  |  |  | (33202354) |  |
|  Provision (Reversal) |  |  |  |  | 22103268 | (653201) | 805841 |  |
|  Other transfer (changes in for FX rate, etc.) |  |  | 5279655 |  | (4051657) | (296654) | (3348083) |  |
|  Ending <sup>1</sup> |  |  | 5309306 |  | 45130192 | 1756384 | 16748420 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 |
|  | **Retails** | **Retails** | **Retails** | **Retails** | **Corporates** | **Corporates** | **Corporates** | **Corporates** |
|  | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** |
|  | **The**<br> **financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **Non-impaired** | **Impaired** |  |  | **Non-impaired** | **Impaired** |  |
|  Beginning |  |  | 26029 |  | 13854964 | 6037794 | 49098464 |  |
|  Transfer between stages |  |  |  |  |  |  |  |  |
|  Transfer to 12-month expected credit losses |  |  |  |  | 38443 | (38443) |  |  |
|  Transfer to lifetime expected credit losses |  |  |  |  |  |  |  |  |
|  Provision (Reversal) |  |  |  |  | 19913706 | (3431871) | (66957) |  |
|  Other transfer (changes in for FX rate, etc.) |  |  | 3622 |  | (3128625) | 361 |  |  |
|  Ending |  |  | 29651 |  | 30678488 | 2567841 | 49031507 |  |

---

Among the loans which have been written-off, the Group manages loans for which the claims against borrowers have not been lost due to reasons such as incomplete extinctive prescription pursuant to relevant laws and uncollected receivables after writing-off, as the written-off loans. As at December 31, 2022 and 2021, the balances of the written-off loans are W 9,218,967 thousand and W 4,600,194 thousand, respectively.

**Broker's loan** 

The Group provides loans for stock purchases with credit period of 180 days (can be extended for six times) for investors using margin transaction. As at December 31, 2022, interest rate of the loan is differentiated from 4.9% to 9.8% based on maturities, and overdue interest rate is 9.9%.

Also, as the Group operates loans secured by securities. At the initial transaction, in case of superior shares and common shares, the Group requires trading securities or cash as collateral, corresponding to 167% and 250% of the loan, respectively. Over 140% collateral of the loan is required. As at December 31, 2022, the interest rate of loans secured by securities is differentiated from Annual Percentage Rate (APR) 6.9% to 9.8% based on maturities, from APR 7.0% to 8.5% based on credit rating, and the loan with past due date is 9.9%.

For margin loan to customers, trading securities or cash is required to be pledged corresponding to 140% of the loan. Because of this condition, the Group pledged securities as collateral which are purchased with margin to customer loan. If the value of the pledged securities do not reach to 140% of the loan, the Group requires additional cash or trading securities as collateral.

**Advances for Customers** 

Advances for customers consists of advanced payments on loss compensation and advanced payments for others.

Advanced payments on loss compensation are the monetary amount of claim for reimbursement, paid by the Group, if any losses from embezzlement and arbitrary trading are occurred.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Advanced payments for others consist of two types. The first type is the amount of recourse from paid Investor Protection Fund based on the previous Securities Exchange Act Article 69 Clause 2 or Clause 4. This recourse is driven by preferred payments to the securities company with reasonable reason for taking the preferred payments. The second type is the amount of recourse from Joint Compensation Fund based on Law relating to the Financial Investment Services and Capital Markets Act Article 323 Clause 14 and related Enforcement Decree Article 318 Clause 8. This recourse is driven by preferred payments to the securities company that occurred reasonable reasons for taking the preferred payments.

**11.** **Property and Equipment** 

The details of property and equipment as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Accumulated<br>revaluation** | **Book amount** |
|  Land | 28242445 |  | 83580757 | 111823202 |
|  Buildings | 47113828 | (20377779) |  | 26736049 |
|  Vehicles | 1127506 | (386660) |  | 740846 |
|  Furniture and equipment | 178606269 | (139984783) |  | 38621486 |
|  Others | 56604592 | (44340837) |  | 12263755 |
|  Right-of-use assets | 146262689 | (66417660) |  | 79845029 |
|  | 457957329 | (271507719) | 83580757 | 270030367 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Accumulated<br>revaluation** | **Book amount** |
|  Land | 29301991 |  | 35727831 | 65029822 |
|  Buildings | 42017785 | (18619751) |  | 23398034 |
|  Furniture and equipment | 153875006 | (121636402) |  | 32238604 |
|  Others | 51878021 | (38488699) |  | 13389322 |
|  Right-of-use assets | 120064333 | (43364266) |  | 76700067 |
|  | 397137136 | (222109118) | 35727831 | 210755849 |

---

The details of right-of-use assets as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Book<br>amount** |
|  Buildings | 137398425 | (60817498) | 76580927 |
|  Vehicles | 4039939 | (1781351) | 2258588 |
|  Others | 4824325 | (3818811) | 1005514 |
|  | 146262689 | (66417660) | 79845029 |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Book<br>amount** |
|  Buildings | 112086115 | (38666617) | 73419498 |
|  Vehicles | 3528320 | (1958126) | 1570194 |
|  Others | 4449898 | (2739523) | 1710375 |
|  | 120064333 | (43364266) | 76700067 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in property and equipment for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Re-valuation** | **Depreciation** | **Business<br>Combination** | **Others <sup>1</sup>** | **Ending<br>balance** |
|  Land | 65029822 |  | (1115081) | 47521151 |  |  | 387310 | 111823202 |
|  Buildings | 23398034 |  | (2147693) |  | (1422159) | 7011613 | (103746) | 26736049 |
|  Vehicles |  | 157715 |  |  | (89681) | 556513 | 116299 | 740846 |
|  Furniture and equipment | 32238604 | 21490998 | (5231) |  | (15831052) | 398798 | 329369 | 38621486 |
|  Others | 13389322 | 6364691 | (97415) |  | (7405465) |  | 12622 | 12263755 |
|  Right-of-use assets | 76700067 | 32036855 | (3497264) |  | (26292607) | 473368 | 424610 | 79845029 |
|  | 210755849 | 60050259 | (6862684) | 47521151 | (51040964) | 8440292 | 1166464 | 270030367 |

---

<sup>1</sup> Others consist of reclassification to investment properties, foreign exchange differences and others.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Depreciation** | **Others <sup>1</sup>** | **Ending<br>balance** |
|  2022 Land | 65263726 |  | (272921) |  | 39017 | 65029822 |
|  Buildings | 24916560 |  | (237867) | (1064308) | (216351) | 23398034 |
|  Furniture and equipment | 29504091 | 17073312 | (12780) | (14378347) | 52328 | 32238604 |
|  Others | 16497063 | 6512746 | (174045) | (9461399) | 14957 | 13389322 |
|  Right-of-use assets | 89939130 | 10459410 | (669858) | (18573645) | (4454970) | 76700067 |
|  | 226120570 | 34045468 | (1367471) | (43477699) | (4565019) | 210755849 |

---

<sup>1</sup> Others consist of reclassification to investment properties, foreign exchange differences and others.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in right-of-use assets for the year ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Depreciation** | **Business<br>Combination** | **Others <sup>1</sup>** | **Ending<br>balance** |
|  Buildings | 73419498 | 29366072 | (3080026) | (24022595) | 473368 | 424610 | 76580927 |
|  Vehicles | 1570194 | 2291704 | (414827) | (1188483) |  |  | 2258588 |
|  Others | 1710375 | 379080 | (2412) | (1081529) |  |  | 1005514 |
|  | 76700067 | 32036856 | (3497265) | (26292607) | 473368 | 424610 | 79845029 |

---

<sup>1</sup> Others consist of foreign exchange differences and others.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Depreciation** | **Others <sup>1</sup>** | **Ending<br>balance** |
|  Buildings | 85892473 | 8199226 | (98178) | (16115606) | (4458417) | 73419498 |
|  Vehicles | 1345887 | 1729628 | (329252) | (1176069) |  | 1570194 |
|  Others | 2700770 | 530556 | (242428) | (1281970) | 3447 | 1710375 |
|  | 89939130 | 10459410 | (669858) | (18573645) | (4454970) | 76700067 |

---

<sup>1</sup> Others consist of foreign exchange differences and others.

The Group applies the revaluation model in relation to the measurement after the initial recognition of the land and the date of revaluation of the land was August 5, 2022. The Group used the assessed price provided by a qualified appraiser for the revaluation of the land.

The land was measured using sales value of similar land, and the access condition, environment condition and other specific factors are considered when the value is adjusted. There is no change in the valuation technique for the year ended December 31, 2022.

Classification of land that is measured at fair value by fair value hierarchy levels as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Land |  |  | 111823202 | 111823202 |
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Land |  |  | 65029822 | 65029822 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Changes in land which is classified to Level 3 for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 65029822 | 65263726 |
|  Reclassification to property and equipment | 642447 | 491317 |
|  Reclassification to investment properties | (255137) | (452300) |
|  Disposal | (1115081) | (272921) |
|  Changes in fair-valuation | 47521151 |  |
|  Ending balance | 111823202 | 65029822 |

---

Book amounts of land under cost model as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Under**<br> **revaluation model** | **Under**<br> **revaluation model** | **Under**<br> **cost model** | **Under**<br> **cost model** | **Under**<br> **revaluation model** | **Under**<br> **revaluation model** | **Under**<br> **cost model** | **Under**<br> **cost model** |
|  Land |  | 111823202 |  | 28242445 |  | 65029822 |  | 29301991 |

---

Change in other comprehensive income related to the revaluation for the year ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning balance** | **Reclassification** | **Ending balance** |
|  Land | 36132409 | 47900256 | 84032665 |
|  Income tax effects | (10034165) | (12332245) | (22366410) |
|  | 26098244 | 35568011 | 61666255 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Reclassification** | **Disposal and<br>others** | **Ending<br>balance** |
|  Land | 36517219 | (355466) | (29344) | 36132409 |
|  Income tax effects | (10042235) |  | 8070 | (10034165) |
|  | 26474984 | (355466) | (21274) | 26098244 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**12. Investment Properties** 

The details of investment properties as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Acquisition<br>cost** | **Accumulated<br>depreciation** | **Accumulated<br>impairment** | **Accumulated<br>revaluation** | **Book amount** |
|  Land | 329642021 |  | (332250) | (477509) | 328832262 |
|  Buildings | 283263254 | (46476719) |  | (5198652) | 231587883 |
|  | 612905275 | (46476719) | (332250) | (5676161) | 560420145 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Accumulated<br>impairment** | **Accumulated<br>revaluation** | **Book amount** |
|  Land | 756633169 |  | (446687) | (59928) | 756126554 |
|  Buildings | 445162487 | (48678965) | (4863096) |  | 391620426 |
|  | 1201795656 | (48678965) | (5309783) | (59928) | 1147746980 |

---

The changes in investment properties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Depreciation** | **Business<br>Combination** | **Others <sup>1</sup>** | **Ending<br>balance** |
|  Land | 756126554 |  | (414592969) |  |  | (12701323) | 328832262 |
|  Buildings | 391620426 | 1604545 | (153057197) | (9351262) | 2618618 | (1847247) | 231587883 |
|  | 1147746980 | 1604545 | (567650166) | (9351262) | 2618618 | (14548570) | 560420145 |

---

<sup>1</sup> Others consist of foreign exchange differences and transfer from/to property and equipment.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning balance** | **Acquisition** | **Disposal** | **Depreciation** | **Others <sup>1</sup>** | **Ending balance** |
|  Land | 769225814 | 28568447 | (63117477) |  | 21449770 | 756126554 |
|  Buildings | 404178409 | 90392980 | (107679883) | (12253077) | 16981997 | 391620426 |
|  | 1173404223 | 118961427 | (170797360) | (12253077) | 38431767 | 1147746980 |

---

<sup>1</sup> Others consist of foreign exchange differences and transfer from/to property and equipment.

Details of income and expenditure on investment properties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Rental income | 41378496 | 59289744 |
|  Expenditure on operating investment properties | (18058162) | (25333928) |
|  Expenditure on non-operating investment properties | (153330) | (153330) |
|  | 23167004 | 33802486 |

---

Details of fair value of investment properties as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Book amount** | **Book amount** | **Fair value** | **Fair value** | **Book amount** | **Book amount** | **Fair value** | **Fair value** |
|  Land |  | 328832262 |  | 325981165 |  | 756126554 |  | 797881841 |
|  Buildings |  | 231587883 |  | 246004136 |  | 391620426 |  | 438756547 |
|  |  | 560420145 |  | 571985301 |  | 1147746980 |  | 1236638388 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The fair values of investment properties as at December 31, 2022 was evaluated by an independent appraiser. The independent appraiser has appropriate qualification and experience in evaluating real estate in the location of investment properties.

The fair value of investment property was measured by using benchmark price of similar properties and discounted cash flow (DCF) method. The fair value of investment property measured by DCF method is assessed by discounting net cash flow from investment property with risk adjusted discount rate, which is reflected by expected growth rate of rent market, period of empty, proportion of rent, period without rent charge and other cost related to promotion for rent. The factors which are significant but non-observable inputs for fair valuation are expected growth rate of rent market, period of empty, proportion of rent, period without rent charge and risk adjusted discount rate.

The fair value of investment property measured by using sales value of similar land is calculated by analyzing and comparing the sale prices of similar land, and also the access condition, environment condition and other specific factors for the purpose of estimation for fair value are considered.

The fair values of investment properties are classified as Level 3 based upon the inputs, which are used in valuation method.

There is no significant change in the valuation technique for the year ended December 31, 2022

Details of investment properties provided as collaterals as at December 31, 2022 and 2021 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Secured amount** | **Secured party** | **Details** |
|  Land and buildings |  |  |  |
|  Land and buildings | 33798891 | Signature Bank |  |
|  | 81882720 | Landesbank Hessen-Thuringen Girozentrale | Collateralized borrowing |
|  | 236788850 | LGIM COMMERCIAL LENDING LIMITED |  |
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Secured amount** | **Secured party** | **Details** |
|  Land and buildings |  |  |  |
|  | 32364150 | Signature Bank |  |
|  | 81345804 | Landesbank Hessen-Thuringen Girozentrale |  |
|  | 57609000 | Pfandbriefbank | Collateralized borrowing |
|  | 248038750 | LGIM COMMERCIAL LENDING LIMITED |  |
|  | 252000000 | Hanhwa Life Insurance |  |
|  | 126000000 | Tongyang Life Insurance |  |
|  | 12000000 | Kookmin Bank |  |

---

Investment properties are provided as collaterals for rental deposits and lease hold right, which amounts to W 610,000 thousand and W 7,774,547 thousand as at December 31, 2022 and 2021, respectively.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**13. Intangible Assets** 

The details of intangible assets as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>amortization** | **Accumulated<br>impairment** | **Book amount** |
|  Goodwill | 83550540 |  |  | 83550540 |
|  Development costs | 186869610 | (139522251) |  | 47347359 |
|  Software | 120472571 | (90480882) |  | 29991689 |
|  Memberships | 37847587 | (202382) | (9960904) | 27684301 |
|  Others | 28144713 | (4036797) | (813199) | 23294717 |
|  | 456885021 | (234242312) | (10774103) | 211868606 |
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>amortization** | **Accumulated<br>impairment** | **Book amount** |
|  Goodwill | 72422758 |  |  | 72422758 |
|  Development costs | 157728820 | (122075492) |  | 35653328 |
|  Software | 106286170 | (80030694) |  | 26255476 |
|  Memberships | 37138036 | (161619) | (9330409) | 27646008 |
|  Others | 27831662 | (3776235) | (760710) | 23294717 |
|  | 401407446 | (206044040) | (10091119) | 185272287 |

---

The changes in intangible assets for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition <sup>1</sup>** | **Disposal** | **Amortization** | **Impairment <sup>2</sup>** | **Reversal of<br>Impairment <sup>3</sup>** | **Others <sup>4</sup>** | **Ending<br>balance** |
|  Goodwill | 72422758 | 10712158 |  |  |  |  | 415624 | 83550540 |
|  Development costs | 35653328 | 29140791 |  | (17446759) |  |  | (1) | 47347359 |
|  Software | 26255476 | 14098002 |  | (10393151) |  |  | 31362 | 29991689 |
|  Memberships | 27646008 | 1745855 | (1041665) | (36662) | (1028751) | 394684 | 4832 | 27684301 |
|  Others | 23294717 |  |  |  |  |  |  | 23294717 |
|  | 185272287 | 55696806 | (1041665) | (27876572) | (1028751) | 394684 | 451817 | 211868606 |

---

<sup>1</sup> Advance payments and others transferred from other accounts are included.

<sup>2</sup> Memberships are composed of condominium and golf memberships, which are intangible assets with indefinite useful lives. The Group recognized a impairment loss because the market price of the asset is lower than book amount as at December 31, 2022. 

<sup>3</sup> Memberships are composed of condominium and golf memberships, which are intangible assets with indefinite useful lives. The Group recognized a reversal of impairment loss because the market price of the asset is higher than book amount as at December 31, 2022. 

<sup>4</sup> Others consist of foreign exchange differences and others.

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean<br>won)* | **Beginning<br>balance** | **Acquisition <sup>1</sup>** | **Disposal** | **Amortization** | **Impairment <sup>2</sup>** | **Reversal of<br>Impairment <sup>3</sup>** | **Others <sup>4</sup>** | **Ending<br>balance** |
|  Goodwill | 71123932 |  |  |  |  |  | 1298826 | 72422758 |
|  Development costs | 32176319 | 17915813 |  | (14438805) |  |  | 1 | 35653328 |
|  Software | 15214223 | 18905463 |  | (7925949) |  |  | 61739 | 26255476 |
|  Memberships | 27273024 | 34781 | (2124082) | (33008) | (121016) | 2630059 | (13750) | 27646008 |
|  Others | 23294716 |  |  |  |  |  | 1 | 23294717 |
|  | 169082214 | 36856057 | (2124082) | (22397762) | (121016) | 2630059 | 1346817 | 185272287 |

---

<sup>1</sup> Advance payments and others transferred from other accounts are included.

<sup>2</sup> Memberships are composed of condominium and golf memberships, which are intangible assets with indefinite useful lives. The Group recognized a impairment loss because the market price of the asset is lower than book amount as at December 31, 2021. 

<sup>3</sup> Memberships are composed of condominium and golf memberships, which are intangible assets with indefinite useful lives. The Group recognized a reversal of impairment loss because the market price of the asset is higher than book amount as at December 31, 2021. 

<sup>4</sup> Others consist of foreign exchange differences and others.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**14. Other Financial Assets** 

The details of other financial assets as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Other receivables | 2237040540 | 3195524965 |
|  Accrued income | 203371150 | 175194245 |
|  Accrued interest on bonds | 148382124 | 209164728 |
|  Guarantee deposits | 68149689 | 67903379 |
|  Other | 67835435 | 49579115 |
|  Provision for other financial assets | (36846424) | (35544587) |
|  | 2687932514 | 3661821845 |

---

**15. Other Assets** 

The details of other assets as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Other receivables |  | 116417805 |  | 84740 |
|  Advance payments |  | 47713016 |  | 26351186 |
|  Prepaid expenses |  | 87829601 |  | 16962969 |
|  Prepaid value-added taxes |  | 954019 |  | 186676 |
|  Others |  | 3836443 |  | 7306773 |
|  |  | 256750884 |  | 50892344 |

---

**16. Deposit Liabilities** 

The details of deposit liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Customers' deposits** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for brokerage | 5049354662 | 6640427057 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for exchange-traded derivatives trading | 759156922 | 590669251 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for subscription | 904010 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for savings | 6445014 | 8609240 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for repo | 61600 | 61627 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for the investor of collective investment securities | 324357905 | 223800663 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 48641 | 48729 |
|  | 6140328754 | 7463616567 |
|  **Guarantee deposits** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantee deposits in foreign currency | 190255947 | 474568902 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantee deposits in won currency | 468648375 | 452889714 |
|  | 658904322 | 927458616 |
|  | 6799233076 | 8391075183 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**17. Borrowings** 

The details of borrowings as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Call money | 830000000 | 40000000 |
|  Borrowings: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowing from banks | 471777010 | 485868544 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowing from KSFC | 1244222242 | 1093096057 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Asset-backed short-term bonds | 3264247029 | 2027557581 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CP borrowings | 1920000000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 436023703 | 572851733 |
|  Securities sold under repurchase agreements | 6231390409 | 13531208950 |
|  Short-term note issued | 7249429201 | 4475145330 |
|  Debentures: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | 1879536000 | 2428734874 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less: discount on debentures issued | (3429726) | (5081219) |
|  | 23523195868 | 24649381850 |

---

The details of call money as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Interest rate (%)** | **2022** | **2021** |
|  Samsung Asset Management Co., Ltd. and others | 3.45~5.05 | 830000000 | 40000000 |

---

The details of borrowings as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* |  | **Interest rate (%)** | **2022** | **2021** |
|  Borrowings from banks | Kookmin Bank and other | 2.40~9.00 | 471777010 | 485868544 |
|  Borrowings from KSFC | KSFC | 3.45~5.07 | 1244222242 | 1093096057 |
|  Asset-backed short-term bonds | SK Securities co., Ltd., and other | 3.42~7.10 | 3264247029 | 2027557581 |
|  CP borrowings | Hana Securities Co., Ltd. | 3.76~5.99 | 1920000000 |  |
|  Others | NH Nonghyup Capital co., Ltd. and other | 0.00~5.19 | 436023703 | 572851733 |
|  |  |  | 7336269984 | 4179373915 |

---

The details of securities sold under repurchase agreements as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Interest rate (%)** | **2022** | **2021** |
|  Customers | 0.11~4.60 | 4181390409 | 6973309166 |
|  Financial institution | 3.30~4.30 | 2050000000 | 6557899784 |
|  |  | 6231390409 | 13531208950 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The details of short-term note issued as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Interest rate (%)** | **2022** | **2021** |
|  Individual | 0.25~5.60 | 4650359585 | 1724366358 |
|  Corporate | 1.15~5.50 | 2599069616 | 2750778972 |
|  |  | 7249429201 | 4475145330 |

---

The details of debentures as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Date issued** | **Maturity** | **Interest rate (%)** | **2022** | **2021** |
|  The 34-2nd unsecured public debenture | 2018.03.09 | 2023.03.09 | 3.02 | 210000000 | 210000000 |
|  The 36-1st unsecured public debenture | 2019.04.18 | 2022.04.18 |  |  | 250000000 |
|  The 36-2nd unsecured public debenture | 2019.04.18 | 2024.04.18 | 2.09 | 250000000 | 250000000 |
|  The 37-1st unsecured public debenture | 2019.06.14 | 2022.06.14 |  |  | 100000000 |
|  The 37-2nd unsecured public debenture | 2019.06.14 | 2024.06.14 | 1.8 | 150000000 | 150000000 |
|  The 38-1st unsecured public debenture | 2020.06.11 | 2022.06.10 |  |  | 170000000 |
|  The 38-2nd unsecured public debenture | 2020.06.11 | 2023.06.09 | 1.54 | 130000000 | 130000000 |
|  The 39-1st unsecured public debenture | 2021.03.04 | 2024.03.04 | 1.31 | 110000000 | 110000000 |
|  The 39-2nd unsecured public debenture | 2021.03.04 | 2026.03.04 | 1.7 | 120000000 | 120000000 |
|  The 40-1st unsecured public debenture | 2021.04.23 | 2024.04.23 | 1.53 | 300000000 | 300000000 |
|  The 40-2nd unsecured public debenture | 2021.04.23 | 2026.04.23 | 1.94 | 200000000 | 200000000 |
|  The 1st unsecured privately placed bond <sup>1</sup> | 2019.05.27 | 2022.05.27 |  |  | 23900000 |
|  The 1st unsecured privately placed bond <sup>1</sup> | 2021.06.30 | 2022.05.31 |  |  | 23000000 |
|  The 1st unsecured privately placed bond <sup>1</sup> | 2021.09.07 | 2023.03.06 |  |  | 8316583 |
|  The 1st unsecured privately placed bond <sup>1</sup> | 2021.10.29 | 2023.03.06 |  |  | 4158291 |
|  The 1st unsecured privately placed bond <sup>2</sup> | 2022.06.14 | 2024.12.14 | 4.5 | 4000000 |  |
|  The 1st privately placed bond in foreign currency <sup>3</sup> | 2021.10.25 | 2024.10.25 | 2.35 | 25346000 | 23710000 |
|  The 21-1 public debenture in foreign currency <sup>4</sup> | 2021.11.01 | 2026.11.01 | 2.13 | 380190000 | 355650000 |
|  Less: Discount on debentures issued |  |  |  | (3429726) | (5081219) |
|  |  |  |  | 1876106274 | 2423653655 |

---

<sup>1</sup> This privately placed bond was excluded from the scope of consolidation.

<sup>2</sup> This privately placed bond was issued by subsidiary named Able Seun Co., Ltd.

<sup>3</sup> This privately placed bond was issued by subsidiary named Newstar Sina Co., Ltd.

<sup>4</sup> The issuance price of this public debenture is US$300,000,000. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in borrowings for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 24649381850 | 25029132761 |
|  Increase(decrease) in call money | 790000000 | (250000000) |
|  Increase in borrowings from banks | (14091534) | 127407539 |
|  Increase(decrease) in borrowings from KSFC | 151126185 | (256903943) |
|  Increase in asset-backed short-term bond | 1236689448 | 185692613 |
|  Increase(decrease) in CP borrowings | 1920000000 | (8900000) |
|  Decrease in other borrowings | (136828030) | (48314756) |
|  Increase(decrease) in securities sold under repurchase agreements | (7299818541) | (1473306802) |
|  Increase in short-term note issued | 2774283871 | 742417752 |
|  Increase in debentures | (547547381) | 602156686 |
|  Ending balance | 23523195868 | 24649381850 |

---

**18. Post-employment Benefits** 

**18.1 Defined Benefit Plans** 

The details of defined benefit liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Present value of defined benefit obligations | 67937239 | 70914622 |
|  Fair value of plan assets | (12430101) | (15294733) |
|  Net defined benefit liabilities | 55507138 | 55619889 |

---

The changes in the defined benefit obligation for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 70914622 | 72288500 |
|  Current service cost | 22206320 | 18145235 |
|  Past service cost | 2910303 | 1315190 |
|  Interest cost | 1151821 | 780607 |
|  Remeasurements |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Actuarial gains and losses arising from changes in demographic assumptions | (6811193) | 20113645 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Actuarial gains and losses arising from changes in financial assumptions | (13735991) | (1706991) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Actuarial gains and losses arising from experience adjustment | 16610121 | (15407457) |
|  Payments from plans | (8301323) | (1416118) |
|  Payments from the Group | (19507349) | (14513685) |
|  Transfer from related companies | 2438159 | 1823363 |
|  Transfer to related companies | (370486) | (895469) |
|  Settlement | (78335) | (5301320) |
|  Gain or loss on settlement | (1871249) | (4310878) |
|  Effects from business combination and disposal of business | 2634640 |  |
|  Other | (252821) |  |
|  Ending balance | 67937239 | 70914622 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in the fair value of plan assets for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | (15294733) | (18652077) |
|  Interest income | (178723) | (204480) |
|  Remeasurements: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Return on plan assets (excluding amounts included in interest income) | 157107 | 87124 |
|  Contributions by employers | (3347403) | (2297614) |
|  Payments from plans: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Benefits paid | 8301323 | 1416119 |
|  Settlement |  | 5284089 |
|  Transfer from related companies | (2438158) | (1823363) |
|  Transfer to related companies | 370486 | 895469 |
|  Ending balance | (12430101) | (15294733) |

---

Plan assets are composed of the detail assets that have no quoted price in active market. The details of plan assets as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Fair value** | **Composition(%)** | **Fair value** | **Composition(%)** |
|  Cash and deposits | 8853577 | 71.23 | 9539927 | 62.37 |
|  Investment funds | 3576524 | 28.77 | 2327801 | 15.22 |
|  Derivatives |  |  | 3427005 | 22.41 |
|  | 12430101 | 100.00 | 15294733 | 100.00 |

---

Key actuarial assumptions used as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
|  | **2022** | **2021** |
| Discount rate | DB(including special retirement by<br> salaries peak plan) 5.1%<br> Compensation promotion DC 5.0% | DB(including special retirement by<br> salaries peak plan) 2.5%<br> Compensation promotion DC 2.3% |
| Expected salary growth rate | DB : executives 0%<br> DC: Promotion + Base up 2.3%<br> Special retirement by salaries peak<br> plan: 4.6% | DB : executives 0%<br> DC: Promotion + Base up<br> (December 31, 2021 : 2.3%,<br> After December 31, 2022 : 2.0%)<br> Special retirement by salaries peak<br> plan : January 1<sup>st</sup>, 2022 : 4.6%(2.3% +<br> Promotion added 2.3%)<br> After January 1<sup>st</sup>, 2023 : 4.3% (2.0% +<br> Promotion added 2.3%) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The sensitivity analysis for significant actuarial assumptions used to determine the present value of the defined benefit obligation as at December 31, 2022, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Effect on the present value of defined benefit obligation** | **Effect on the present value of defined benefit obligation** | **Effect on the present value of defined benefit obligation** |
| *(in thousands of Korean won)* | **Changes in<br>assumption** | **Increase** | **Decrease** |
|  Discount rate | 0.50% | (1609503) | 1705619 |
|  Expected salary growth rate<sup>1</sup> | 0.50% | 1631234 | (1544704) |
|  Retirement rate | 0.50% | (1238827) | 1303693 |

---

<sup>1</sup> The sensitivity analysis for the expected salary growth rate is limited to special retirement by salaries peak plan and DB.

The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. The sensitivity of the present value of the defined benefit obligation to changes in actuarial assumptions is calculated using the projected unit credit method, the same method applied when calculating the defined benefit obligations.

The methods and assumptions used in preparing the sensitivity analyses did not change compared to the previous period.

The effect of defined benefit plan on future cash inflows: Expected maturity analysis of undiscounted pension benefits as at December 31, 2022, is as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Less than 1<br>year <sup>1</sup>** | **Between 1<br>and 2 years** | **Between 2<br>and 5 years** | **Between 5<br>and 10 years** | **Over 10<br>years** | **Total** |
|  Pension benefits<sup>1</sup> | 5066411 | 6379701 | 24686972 | 30520116 | 71780706 | 138433906 |

---

<sup>1</sup> Fixed pension benefits of W 14.1 billion under promotion compensation defined contribution plan is excluded.

The weighted average duration of the defined benefit obligations is 5.79 years.

Expected contribution to post-employment benefit plans for the year ending December 31, 2022 are W 1,241,430 thousand.

**18.2 Defined Contribution Plans** 

The Group recognized the expenses of W 9,212,523 thousand and W 5,766,377 thousand for defined contribution plans for the years ended December 31, 2022 and 2021, respectively.

**19. Provisions** 

The details of provisions as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Provisions for non-financial guarantees | 1456106 | 1680410 |
|  Provisions for asset retirement obligation <sup>1</sup> | 8802261 | 7997559 |
|  Provisions for lawsuits | 51221194 | 25150111 |
|  Provisions for the points |  | 2569985 |
|  Provisions for others | 89485845 | 68725325 |
|  | 150965406 | 106123390 |

---

<sup>1</sup> The Group recognized the provision for asset retirement obligation in connection with the leased asset for the expenditures expected to recover the asset.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in provisions for non-financial guarantees for the years ended December 31, 2022 and 2021 are as follows,

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** |
|  | **The financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **Non-impaired** | **Impaired** |
|  Beginning | 1642264 | 38146 |  |
|  Provision for losses (Reversal of provision) | (418773) | 194212 |  |
|  Other transfer(foreign exchange and other) | 257 |  |  |
|  Ending | 1223748 | 232358 |  |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** |
|  | **The financial**<br> **instruments**<br> **applying**<br> **12-month**<br> **expected**<br> **credit losses** | **Non-impaired** | **Impaired** |
|  Beginning | 1342023 |  |  |
|  Transfer between stages |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected Credit losses (non-impaired) | (23238) | 23238 |  |
|  Provision for losses (Reversal of provision) | 323272 | 14908 |  |
|  Other transfer(foreign exchange and other) | 207 |  |  |
|  Ending | 1642264 | 38146 |  |

---

The changes in other provisions for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Provisions<br>for asset<br>retirement<br>obligation** | **Provisions<br>for lawsuits** | **Provisions for<br>the points** | **Provisions for<br>others** | **Total** |
|  Beginning | 7997559 | 25150111 | 2569985 | 68725325 | 104442980 |
|  Contribution <sup>1</sup> | 1026723 | 25165908 | 2451694 | 33991287 | 62635612 |
|  |  |  |  | (4038034) | (4038034) |
|  Use | (423495) | (1229477) | (2788799) | (7058081) | (11499852) |
|  Amortization of discounts | 201474 |  |  |  | 201474 |
|  Other <sup>2</sup> |  | 2134652 | (2232880) | (2134652) | (2232880) |
|  Ending | 8802261 | 51221194 |  | 89485845 | 149509300 |

---

<sup>1</sup> As the first-instance verdict of the relevant trial was announced after the reporting period, additional litigation provision liabilities were recognized as an adjusting event after the reporting period.

<sup>2</sup> As a lawsuit was filed during the year ended December 31, 2022, the estimated loss on the sale of funds related to Lime Asset Management was replaced to provisions for lawsuits.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Provisions<br>for asset<br>retirement<br>obligation** | **Provisions<br>for lawsuits** | **Provisions<br>for the<br>points** | **Provisions for<br>others** | **Total** |
|  Beginning | 8114793 | 10643375 | 2205019 | 60565500 | 81528687 |
|  Contribution | 57684 | 8892 | 4520637 | 36725325 | 41312538 |
|  Use | (304037) | (206240) | (4155671) | (13861416) | (18527364) |
|  Amortization of discounts | 129119 |  |  |  | 129119 |
|  Other <sup>1</sup> |  | 14704084 |  | (14704084) |  |
|  Ending | 7997559 | 25150111 | 2569985 | 68725325 | 104442980 |

---

<sup>1</sup> As a lawsuit was filed during the year ended December 31, 2021, the estimated loss on the sale of funds related to Lime Asset Management was replaced to provisions for lawsuits.

**20. Other Financial Liabilities** 

The details of other financial liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Other payables | 1974490601 | 3048066867 |
|  Accrued expenses | 106815440 | 49457140 |
|  Financial guarantee liabilities | 2026739 | 2213138 |
|  Provisions for financial guarantee contracts |  | 66218 |
|  Leasehold deposits received | 8894337 | 26518264 |
|  Non-controlling liabilities | 164222254 | 228717913 |
|  Lease liabilities | 125593239 | 127992813 |
|  Others | 7498861 | 1617918 |
|  | 2389541471 | 3484650271 |

---

The changes in liabilities of the provisions for financial guarantee contracts for the years ended December 31, 2022 and 2021 are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** |
|  | **The financial**<br> **instruments**<br> **applying 12-month**<br> **expected credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** |
|  | **The financial**<br> **instruments**<br> **applying 12-month**<br> **expected credit losses** | **Non-impaired** | **Impaired** |
|  Beginning | 66218 |  |  |
|  Reversal of provision | (66218) |  |  |
|  Ending |  |  |  |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** | **2021** |
|  | **The financial**<br> **instruments**<br> **applying 12-month**<br> **expected credit losses** | **The financial**<br> **instruments**<br> **applying 12-month**<br> **expected credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** | **The financial instruments**<br>**applying lifetime expected**<br>**credit losses** |
|  | **The financial**<br> **instruments**<br> **applying 12-month**<br> **expected credit losses** | **The financial**<br> **instruments**<br> **applying 12-month**<br> **expected credit losses** | **Non-impaired** | **Impaired** |
|  Beginning |  |  |  |  |
|  Provision |  | 66218 |  |  |
|  Ending |  | 66218 |  |  |

---

<sup>1</sup> The impact of COVID-19 is reflected in the future economy outlook, and the financial effect of the impact related COVID-19 is not material.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**21. Other Liabilities** 

The details of other liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Accounts payables | 31630 | 43216188 |
|  Accrued expenses | 179569070 | 258774213 |
|  Accrued dividends | 2952757 |  |
|  Advances from customers | 7048181 | 4832377 |
|  Unearned revenue | 215363367 | 74881733 |
|  Taxes withheld | 44787661 | 34664311 |
|  Other long-term employee benefits | 7176237 | 7630850 |
|  Others | 16185601 | 3826568 |
|  | 473114504 | 427826240 |

---

**22. Share Capital** 

The details of share capital as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won except per share)* | **Authorized shares** | **Outstanding shares** | **Par value**<br> **per share** | **Par value**<br> **per share** | **2022** | **2022** | **2021** | **2021** |
|  Ordinary share | 1,000,000,000<br>shares | 298,620,424<br> shares |  | 5,000 won |  | 1493102120 |  | 1493102120 |

---

There are no changes in ordinary shares for the years ended December 31, 2022 and 2021.

**23. Hybrid Securities** 

Details of hybrid security classified as equity as of December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Issuance<br>date** | **Maturity** | **Interest rate<br>(%)** | **2022** | **2021** |
|  Bond-type Hybrid Securities No.1<sup>1</sup> | March 31,<br>2022 | Permanent | 4.30 | 208010752 |  |
|  Bond-type Hybrid Securities No.2 | May 30,<br> 2022 | Permanent | 4.80 | 48170780 |  |
|  Bond-type Hybrid Securities No.3<sup>2</sup> | September<br>30, 2022 | Permanent | 5.50 | 249948780 |  |
|  |  |  |  | 506130312 |  |

---

<sup>1</sup> As at December 31, 2022, among the hybrid securities issued by the Group, the balance held by KB Financial Group, a related party of the Group, is W200,000 million.

<sup>2</sup> As at December 31, 2022, among the hybrid securities issued by the Group, the balance held by KB Financial Group, a related party of the Group, is W230,000 million.

The Group may extend the maturity under the same conditions at the time of maturity of the above hybrid securities, and interest payment may be deferred if certain conditions are met. Above hybrid securities are early redeemable by the Group after 5 years from the issuance date and each interest payment date thereafter.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**24. Other Paid-in Capital** 

The details of other paid-in capital as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Share premium <sup>1</sup> | 1142353750 | 1142353750 |
|  Gains and losses on sale of treasury share | (45331811) | (45331811) |
|  Other equity <sup>2</sup> | 381666039 | 381666039 |
|  | 1478687978 | 1478687978 |

---

<sup>1</sup> Share premium was previously paid from stock issuance and new stock issuance due to merger and can only be used for capitalization and deficit recovery.

<sup>2</sup> Other equity arose from the paid-in capital increase of preferred share and gains on merger.

Changes in other paid-in capital for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 1478687978 | 1478716746 |
|  Changes in ownership percentage due to the paid-in<br> capital increase of subsidiaries |  | (28768) |
|  Ending balance | 1478687978 | 1478687978 |

---

**25. Retained Earnings** 

The details of retained earnings as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Legal reserve |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Earned surplus reserve <sup>1</sup> | 128656298 | 101656298 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reserve for liability to compensate for damages <sup>2</sup> | 500000 | 500000 |
|  Voluntary reserves | 1839996358 | 1540948010 |
|  Regulatory reserve for credit losses <sup>3</sup> | 101842161 | 100223524 |
|  Unappropriated retained earnings | (32545040) | 504642277 |
|  | 2038449777 | 2247970109 |

---

<sup>1</sup> The Commercial Act of the Republic of Korea requires the Group to appropriate, as a legal reserve, an amount equal to a minimum of 10% of cash dividends paid until such reserve equals 50% of its issued share capital. The reserve is not available for the payment of cash dividends, but may be transferred to share capital or used to reduce accumulated deficit. 

<sup>2</sup> The Parent Company provides reserve for loss on electronic financial transactions to make reparation for the damage in process of the electronic transfers or operations. Also, the Parent Company provides reserve to compensate for inflicted damage on a credit information subject when violating the Credit Information Use and Protection Act. 

<sup>3</sup> The Group accumulates allowances for possible loan losses in accordance with Korean IFRS and reserve for possible loan losses as much as the amount below the provision of allowances according to minimum accumulation ratio required by Financial Supervisory Service. 

Changes in retained earnings for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 2247970109 | 1847509495 |
|  Profit for the year | 193697356 | 600439340 |
|  Dividends | (400000000) | (200000000) |
|  Dividends of hybrid securities | (3479007) |  |
|  Transfer to gain due to disposal of revaluation assets | 261319 | 21274 |
|  Ending balance | 2038449777 | 2247970109 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The amount of dividends and dividends per share for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in Korean won and number of shares)* | **Type of<br>share** | **Number of<br>shares<br>outstanding** | **Number of<br>treasury**<br> **shares** | **Number of<br>dividend<br>shares** | **Dividend<br>per<br>share** | **Total dividend**<br> **(In thousands of<br>Korean won)** |
|  Interim dividend | Ordinary<br>share | 298,620,424<br>shares |  | 298,620,424<br> shares | 669 | 200000000 |
|  Annual dividend | Ordinary<br>share | 298,620,424<br>shares |  | 298,620,424<br> shares | 669 | 200000000 |
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in Korean won and number of shares)* | **Type of<br>share** | **Number of<br>shares<br>outstanding** | **Number of<br>treasury**<br> **shares** | **Number of<br>dividend<br>shares** | **Dividend<br>per<br>share** | **Total dividend**<br> **(In thousands of<br>Korean won)** |
|  Interim dividend | Ordinary<br>share | 298,620,424<br>shares |  | 298,620,424<br> shares | 234 | 70000000 |
|  Annual dividend | Ordinary<br>share | 298,620,424<br>shares |  | 298,620,424<br> shares | 435 | 130000000 |

---

Payout and dividend yield ratios as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
|  | **Ordinary**<br> **share** | **Ordinary**<br> **share** | **Ordinary**<br> **share** | **Ordinary**<br> **share** |
|  | Interim dividend | Annual dividend | Interim dividend | Annual dividend |
|  Number of shares outstanding | 298,620,424<br> shares | 298,620,424<br> shares | 298,620,424<br> shares | 298,620,424<br> shares |
|  Number of treasury shares |  |  |  |  |
|  Number of dividend shares | 298,620,424<br> shares | 298,620,424<br> shares | 298,620,424<br> shares | 298,620,424<br> shares |
|  Par value per share (in Korean won) | 5000 | 5000 | 5000 | 5000 |
|  Payout ratio | 13.39% | 6.69% | 4.68% | 13.39% |
|  Scheduled dividends (in thousands of Korean won) | 200000000 | 100000000 | 70000000 | 200000000 |
|  Dividends per share (in Korean won) | 669 | 334 | 234 | 669 |

---

The Group accumulates allowances for possible loan losses in accordance with Korean IFRS and reserve for possible loan losses as much as the amount below the provision of allowances according to minimum accumulation ratio required by Regulation on Supervision of Financial Investment.

Regulatory reserve for credit losses, a type of voluntary reserve for retained earnings, reverses the exceeding amount if the beginning balance of the reserve exceeds the ending balance at the closing date. Regulatory reserve for credit losses is generally recognized after unappropriated deficit is disposed.

The details of the regulatory reserve for credit losses (reversal of reserve) to be appropriated as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning | 101842161 | 100223524 |
|  Amounts to be reserved (reversed) | (1526732) | 1618637 |
|  Ending | 100315429 | 101842161 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The adjusted profit of the year after reflection of reversal (provision) of reserve for credit losses for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Profit for the year before reserve for credit loss | 194827662 | 600291416 |
|  Amounts to be reversed (reserved) | 1526732 | (1618637) |
|  Adjusted profit after reversed (provision) of reserve for credit losses<sup>1</sup> | 196354394 | 598672779 |

---

<sup>1</sup> Reserve for credit loss is announced by Article 3 Clause 8 of the Regulation on Financial Investment Business. Adjusted profit after reserve for credit losses is not based on Korean IFRS and is calculated on the assumption that provision or reversal of reserve for credit losses before tax is adjusted to the profit. 

**26. Other Components of Equity** 

The details of other components of equity as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Changes in the fair value of financial assets at FVOCI | 233760812 | 216494145 |
|  Share of other comprehensive income of associates | (2571874) | (9779) |
|  Revaluation surplus | 62060360 | 26749635 |
|  Remeasurements of net defined benefit liabilities | (37781761) | (40520752) |
|  Exchange differences on translation of foreign operations | 45820903 | 12877767 |
|  Hedge of net investments in foreign operations | (19066669) | (13316283) |
|  Gain or loss on financial liabilities designated at FVTPL due to the change of credit risk | 41080867 | 2225783 |
|  | 323302638 | 204500516 |

---

The changes in gain or loss on valuation of financial assets at FVOCI for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 216494145 | 205927502 |
|  Gain (loss) on valuation | 11241986 | 17339966 |
|  Tax effect of gain (loss) on valuation <sup>1</sup> | (39698) | (4768491) |
|  Transfer to gain due to disposal or impairment | 8187321 | (2765286) |
|  Tax effect of transfer <sup>1</sup> | (2122942) | 760454 |
|  Ending balance | 233760812 | 216494145 |

---

<sup>1</sup> Including income tax effect (Note 35).

The changes in the Group's share of other comprehensive income of associates for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | (9779) | (33271) |
|  Changes of other comprehensive income of associates | (2806800) | 23559 |
|  Tax effect <sup>1</sup> | 244705 | (67) |
|  Ending balance | (2571874) | (9779) |

---

<sup>1</sup> Including income tax effect (Note 35).

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in gain on revaluation of property and equipment for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 26749635 | 26770909 |
|  Net valuation gain or loss by revaluation of property and equipment | 47900256 |  |
|  Tax effect related to net valuation gain or loss for property. and equipment <sup>1</sup> | (12328212) |  |
|  Transfer to retained earnings due to disposal of Property and equipment and others | (261319) | (21274) |
|  Ending balance | 62060360 | 26749635 |

---

<sup>1</sup> Including income tax effect (Note 35).

The changes in remeasurements of the net defined benefit liability for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | (40520752) | (38283169) |
|  Changes due to valuation | 3779955 | (3086321) |
|  Tax effect <sup>1</sup> | (1040964) | 848738 |
|  Ending balance | (37781761) | (40520752) |

---

<sup>1</sup> Including income tax effect (Note 35).

The changes in exchange differences on translation of foreign operations for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 12877767 | (4277544) |
|  Change on foreign operations translation | 33272037 | 28632701 |
|  Tax effect <sup>1</sup> | (8817090) | (3571779) |
|  Non-controlling interest | 817442 | (234864) |
|  Transferred to equity related to the disposal group classified as held for sale | 7670747 | (7670747) |
|  Ending balance | 45820903 | 12877767 |

---

<sup>1</sup> Including income tax effect (Note 35).

The changes in gain or loss on valuation of hedge of net investments in foreign operations for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | (13316283) | (233745) |
|  Gain (loss) on net investment in a foreign operation hedge | (16003726) | (18044880) |
|  Re-classification to net income due to the end of net investments in foreign operations | 8429967 |  |
|  Tax effect <sup>1</sup> | 1823373 | 4962342 |
|  Ending balance | (19066669) | (13316283) |

---

<sup>1</sup> Including income tax effect (Note 35).

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The change in gain or loss on financial liabilities designated at FVTPL due to the change of credit risk for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 2225783 | (11488825) |
|  Changes | 52822291 | 18916700 |
|  Tax effect <sup>1</sup> | (13967207) | (5202092) |
|  Ending balance | 41080867 | 2225783 |

---

<sup>1</sup> Including income tax effect (Note 35).

**27. Fee and Commission Income and Expense** 

The details of fee and commission income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Brokerage commissions | 440988001 | 726241481 |
|  Underwriting commissions | 158574302 | 123079958 |
|  Brokerage commissions on collective investment securities | 19850174 | 28155111 |
|  Management fee on collective investment securities | 126162 |  |
|  Management fee on asset management | 25250989 | 30304367 |
|  Commissions on merger and acquisition | 129236138 | 130301073 |
|  Trust fees and commissions | 17996232 | 14581037 |
|  Other commissions | 147681784 | 91585352 |
|  | 939703782 | 1144248379 |

---

The details of fee and commission expense for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Trading commission | 49037488 | 58690224 |
|  Advisory fees | 1664749 | 1967202 |
|  Investment management delegation fees | 3537986 | 4709857 |
|  Commission fees on group brand | 15661129 | 18483104 |
|  Contributions to external institutions | 8093205 | 7593876 |
|  Others | 116472809 | 95423744 |
|  | 194467366 | 186868007 |

---

**28. Gain or Loss on Valuation and Disposal of Financial Instruments** 

The details of gain or loss on valuation and disposal of financial instruments for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Financial instruments at FVTPL | 1310630422 | 2049888240 | (739257818) |
|  Financial instruments designated at FVTPL | 1188229550 | 429243880 | 758985670 |
|  Derivative financial instruments | 8176134413 | 8557742085 | (381607672) |
|  Financial assets at FVOCI <sup>1</sup> | 525431 | 16448206 | (15922775) |
|  | 10675519816 | 11053322411 | (377802595) |

---

<sup>1</sup> Gain or loss on valuation of financial assets at FVOCI is excluded.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Financial instruments at FVTPL | 1184940322 | 1285334042 | (100393720) |
|  Financial instruments designated at FVTPL | 625254719 | 654985522 | (29730803) |
|  Derivative financial instruments | 3735932974 | 3625300129 | 110632845 |
|  Financial assets at FVOCI <sup>1</sup> | 4513829 | 15923820 | (11409991) |
|  | 5550641844 | 5581543513 | (30901669) |

---

<sup>1</sup> Gain or loss on valuation of financial assets at FVOCI is excluded.

The details of gain or loss on valuation and disposal of financial instruments at FVTPL for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Financial assets at FVTPL | 1199535387 | 1987265746 | (787730359) |
|  Financial liabilities at FVTPL | 111095035 | 62622494 | 48472541 |
|  | 1310630422 | 2049888240 | (739257818) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Financial assets at FVTPL | 1114176966 | 1205418377 | (91241411) |
|  Financial liabilities at FVTPL | 70763356 | 79915665 | (9152309) |
|  | 1184940322 | 1285334042 | (100393720) |

---

The details of gain or loss on valuation and disposal of financial instruments designated at FVTPL for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  **Financial liabilities designated at FVTPL** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives-linked securities sold | 914565927 | 359592452 | 554973475 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other OTC derivative-combined contract sold | 244528092 | 52797971 | 191730121 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange traded notes sold | 29135531 | 16853457 | 12282074 |
|  | 1188229550 | 429243880 | 758985670 |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  **Financial liabilities designated at FVTPL** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives-linked securities sold | 573754517 | 567589577 | 6164940 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other OTC derivative-combined contract sold | 45436321 | 80650312 | (35213991) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange traded notes sold | 6063881 | 6745633 | (681752) |
|  | 625254719 | 654985522 | (29730803) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The details of gain or loss on valuation and disposal of derivative financial instruments for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Interest rate | 4490512732 | 4271428797 | 219083935 |
|  Currency | 1596009463 | 1457126463 | 138883000 |
|  Stock | 1935095420 | 2446918853 | (511823433) |
|  Credit | 38991621 | 31943503 | 7048118 |
|  Commodity | 33575544 | 30167440 | 3408104 |
|  Others | 81949633 | 320157029 | (238207396) |
|  | 8176134413 | 8557742085 | (381607672) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Interest rate | 1324856948 | 1264386603 | 60470345 |
|  Currency | 637974651 | 572974001 | 65000650 |
|  Stock | 1586645505 | 1585944032 | 701473 |
|  Credit | 20146569 | 13981328 | 6165241 |
|  Commodity | 21864231 | 14815335 | 7048896 |
|  Others | 144445070 | 173198830 | (28753760) |
|  | 3735932974 | 3625300129 | 110632845 |

---

The details of gain or loss on valuation and disposal of financial assets at FVOCI for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Debt instruments | 525431 | 16448206 | (15922775) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Debt instruments | 4513829 | 15923820 | (11409991) |

---

As at December 31, 2022, the Group holds PIS(Portfolio Index Swap) in connection with Lime Tethys Qualified Investor Private Investment Trust No. 2 and Lime Pluto FI Qualified Investor Private Investment Trust D-1, which were prohibited to repurchase in the fourth quarter of 2019. The Group holds beneficiary certificates and TRS contracts of W163.1 billion (nominal amount). Meanwhile, the Group sold W68.1 billion in subsidiary funds of the fund.

On October 20, 2020, Lime Asset Management's license as a fund manager was revoked by the Financial Supervisory Service's sanctions review committee, and most of its redemption-suspended funds and normal funds will be transferred to Wellbridge Asset Management (the bridge management company) to continue collecting and distributing investments. It is difficult to predict whether and when the aforementioned redemption-suspended funds will be redeemed. As of December 31, 2022, 4 lawsuits were filed to the Group as a defendant and the Group recognizes provisions for lawsuits for the estimated losses due to the possibility of additional lawsuits being filed in the future.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**29. Interest Income and Interest Expense** 

The details of interest income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Interest on financial assets at FVTPL |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on debt instruments at FVTPL | 396607418 | 343144350 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on loans at FVTPL | 4189123 | 6773305 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on commercial papers | 142422181 | 52496923 |
|  | 543218722 | 402414578 |
|  Interest on financial assets at FVOCI and financial assets measured at amortised cost |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on loans measured at amortised cost | 9409656 | 10374554 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on debt instruments at FVOCI | 76499887 | 47099927 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on broker's loans | 236159728 | 219881544 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on loans | 225699957 | 112290556 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on deposits with KSFC | 9784119 | 1834471 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on certificates of deposit |  | 12974 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on deposits with financial institution | 26600 | 5560 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on bonds purchased under resale agreements | 16041014 | 3911835 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on transactions of certificates of deposits | 51521 | 43948 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on deposits | 26938070 | 20413692 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on other receivables | 1006504 | 2013585 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others <sup>1</sup> | 15194408 | 6389513 |
|  | 616811464 | 424272159 |
|  | 1160030186 | 826686737 |

---

<sup>1</sup> Interest on lease receivables of \ 1,084 million and \ 1,616 million for the year ended December 31, 2022 and 2021, respectively, are included.

The details of interest expense for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Interest on borrowings | 80720746 | 49411645 |
|  Fees for the proceeds from the sale of stocks loaned | 830841 | 958563 |
|  Interest on customers' deposits | 32433283 | 7096195 |
|  Interest on bonds sold under repurchase agreements | 171398994 | 91025829 |
|  Losses on transactions of certificates of deposit | 76 | 619 |
|  Interest on call money | 12644133 | 3045203 |
|  Interest on debentures | 43800902 | 43052965 |
|  Interest on short-term note issued | 163134122 | 43200628 |
|  Interest on asset-backed short-term bonds | 107825509 | 26576586 |
|  Others <sup>1</sup> | 5320722 | 3891991 |
|  | 618109328 | 268260224 |

---

<sup>1</sup> Interest on lease liabilities of \ 3,574 million and \ 2,953 million for the year ended December 31, 2022 and 2021, respectively, are included.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**30. Gain or Loss on Valuation and Disposal of Financial Assets measured at Amortised Costs** 

The detail of gain or loss on valuation and disposal of financial assets measured at amortised cost for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Gain(Loss) on valuation of financial assets measured at amortised cost |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal(Provision) of allowance for credit losses of loans | (22255908) | (16414879) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal(Provision) of allowance for credit losses of deposits | (12598) | 105374 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal(Provision) of allowance for credit losses of other financial<br> assets | (6901629) | (1060298) |
|  Gain(Loss) on disposal of financial assets measured at amortised cost |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain(Loss) on disposal of loans measured at amortised cost | (6094227) | 2347609 |
|  | (35264362) | (15022194) |

---

**31. Gain or Loss on Foreign Currency Transactions** 

The details of gain on foreign currency transactions for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Gain on foreign currency transactions |  | 1159670794 |  | 710365102 |
|  Gain on foreign exchange translation |  | 103735617 |  | 82888025 |
|  |  | 1263406411 |  | 793253127 |

---

The details of loss on foreign currency transactions for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Loss on foreign currency transactions |  | 1121891568 |  | 719825583 |
|  Loss on foreign exchange translation |  | 143828278 |  | 24666526 |
|  |  | 1265719846 |  | 744492109 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**32. Other Operating Income and Other Operating Expenses** 

The details of other operating income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Dividend income |  | 58263080 |  | 47721978 |
|  Distribution income |  | 108397229 |  | 107324359 |
|  Reversal of provision for credit loss |  | 866708 |  | 552679 |
|  Operating lease income |  | 39510613 |  | 57421861 |
|  Others |  | 15862203 |  | 13859608 |
|  |  | 222899833 |  | 226880485 |

---

The details of other operating expenses for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Provision for credit loss |  | 575929 |  | 957077 |
|  Others |  | 26511442 |  | 68030407 |
|  |  | 27087371 |  | 68987484 |

---

**33. Selling and Administrative Expenses** 

(a) The details of selling and administrative expenses for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Labor Costs** |  |  |
|  Salaries | 376100893 | 466062679 |
|  Post-employment benefits | 33430995 | 21492051 |
|  Retirement bonus | 22686894 | 619728 |
|  Other long-term employee benefits | (454613) | 2415192 |
|  Employee benefits | 87485403 | 81299860 |
|  | 519249572 | 571889510 |
|  **Other selling and administrative expenses** |  |  |
|  Employee benefits | 11528107 | 9980170 |
|  Sales promotion expenses | 754374 | 3056724 |
|  Computer system operation expenses | 51106507 | 24436828 |
|  Management expenses for rent | 19660703 | 20908033 |
|  Commissions | 30021900 | 25801889 |
|  Research and development | 495341 | 247420 |
|  Advertising expenses | 27793451 | 28470056 |
|  Depreciation | 51040964 | 43477698 |
|  Training expenses | 3043596 | 1546429 |
|  Amortization expenses of intangible assets | 27876572 | 22397762 |
|  Taxes and dues | 27825717 | 34863679 |
|  Consignment fees | 7067745 | 5296344 |
|  Others | 45129548 | 62890187 |
|  | 303344525 | 283373219 |
|  | 822594097 | 855262729 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

(b) Stock Grant Agreement

The executives of the Group have stock grant agreement with KB Financial Group Inc, in which the Group settles the expense arising from the agreement with KB Financial Group Inc. The Group recognizes the expense in profit or loss as selling and administrative expenses.

The details of the share grants linked to long-term performance as at December 31, 2022, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(In number of<br>shares)* | **Grant date** | **Granted**<br> **shares** | **Payable**<br> **shares<sup>1</sup>** | **Vesting conditions** |
|  Series 1-1 | 2010-1-1 | 1231 | 266 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-8 | 2011-1-1 | 1289 | 365 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-10 | 2012-1-1 | 1976 | 644 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-11 | 2012-6-18 | 708 | 142 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-13 | 2013-1-1 | 3340 | 1074 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-19 | 2015-2-24 | 1812 | 584 | Service, vesting conditions : market 30%, non-market 70% |
|  Series 1-21 | 2016-1-1 | 6671 | 1744 | Service, vesting conditions : market 30%, non-market 70% |
|  Series 1-22 | 2016-12-30 | 76379 | 11628 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-23 | 2017-1-9 | 2299 |  | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-24 | 2017-2-24 | 1698 | 1516 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-25 | 2017-6-1 | 1511 | 203 | Service, vesting conditions : market 30%, non-market 70% |
|  Series 1-26 | 2017-9-4 | 1551 | 1028 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-27 | 2017-8-26 | 2952 |  | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-28 | 2018-1-1 | 14698 | 4103 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-29 | 2018-7-9 | 1208 | 143 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-30 | 2019-1-1 | 80289 | 54959 | Service, vesting conditions : market 80%, non-market 20% |
|  Series 1-30 | 2019-1-1 | 4580 | 3835 | Service, vesting conditions : market 0%, non-market 100% |
|  Series 1-31 | 2019-2-24 | 809 | 637 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-32 | 2019-3-4 | 1888 | 1021 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-33 | 2019-6-1 | 3994 | 2129 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-34 | 2019-9-1 | 2927 | 1059 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-35 | 2019-9-4 | 358 | 207 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-36 | 2019-5-27 | 1167 | 574 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-37 | 2020-1-1 | 48962 | 22614 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-38 | 2020-3-6 | 2856 | 4463 | Service, vesting conditions : market 0%, non-market 100% |
|  Series 1-39 | 2020-8-1 | 12744 | 13849 | Service, vesting conditions : market 20%, non-market 80% |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  Series 1-40 | 2021-1-1 | 98808.0 | 127009.0 | Service, vesting conditions : market 80%, non-market 20% |
|  Series 1-40 | 2021-1-1 | 5675.0 | 5675.0 | Service, vesting conditions : market 0%, non-market 100% |
|  Series 1-41 | 2021-3-4 | 3591.0 | 4786.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-42 | 2021-3-15 | 5190.0 | 4671.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-43 | 2021-5-27 | 604.0 | 298.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-44 | 2021-6-1 | 2904.0 | 3460.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-45 | 2021-8-1 | 2276.0 | 1615.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-46 | 2021-9-1 | 3201.0 | 3376.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-47 | 2022-1-1 | 54170.0 | 29010.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-48 | 2022-2-17 | 1926.0 | 838.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-49 | 2022-3-6 | 928.0 | 928.0 | Service, vesting conditions : market 0%, non-market 100% |
|  Series 1-50 | 2022-5-9 | 2839.0 | 920.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-51 | 2022-8-1 | 4683.0 | 2053.0 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-52 | 2022-8-16 | 4029.0 | 760.0 | Service, vesting conditions : market 20%, non-market 80% |
|  |  | 470721.0 | 314186.0 |  |

---

<sup>1</sup> The number of maximum payable shares per executive as at December 31, 2022.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The details of share grants linked to short-term performance as at December 31, 2022, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(In number of shares)* | **Grant date** | **Granted**<br> **shares** | **Payable<br>shares<sup>1</sup>** | **Vesting conditions<sup>2</sup>** |
|  Series 2-3 | 2016-1-1 | 6844 | 2392 | Proportional to service period, vesting conditions satisfied |
|  Series 2-4 | 2017-1-1 | 27453 | 14945 | Proportional to service period, vesting conditions satisfied |
|  Series 2-5 | 2018-1-1 | 70959 | 26407 | Proportional to service period, vesting conditions satisfied |
|  Series 2-6 | 2019-1-1 | 60039 | 34480 | Proportional to service period, vesting conditions satisfied |
|  Series 2-7 | 2020-1-1 | 68689 | 53929 | Proportional to service period, vesting conditions satisfied |
|  Series 2-8 | 2021-1-1 | 69448 | 69336 | Proportional to service period, vesting conditions satisfied |
|  Series 2-9 | 2022-1-1 | 98396 | 98396 | Proportional to service period, vesting conditions satisfied |
|  Series 3-3 | 2016-1-1 | 15036 | 9438 | Proportional to service period, vesting conditions satisfied |
|  Series 3-4 | 2017-1-1 | 12112 | 7767 | Proportional to service period, vesting conditions satisfied |
|  Series 3-5 | 2018-1-1 | 25393 | 9624 | Proportional to service period, vesting conditions satisfied |
|  Series 3-6 | 2019-1-1 | 44696 | 26378 | Proportional to service period, vesting conditions satisfied |
|  Series 3-7 | 2020-1-1 | 77112 | 57391 | Proportional to service period, vesting conditions satisfied |
|  Series 3-8 | 2021-1-1 | 91948 | 91948 | Proportional to service period, vesting conditions satisfied |
|  Series 4-1 | 2017-12-31 | 191786 | 21865 | Proportional to service period, vesting conditions satisfied |
|  Series 4-2 | 2019-12-31 | 273097 | 92959 | Proportional to service period, vesting conditions satisfied |
|  Series 4-3 | 2020-12-31 | 283365 | 192737 | Proportional to service period, vesting conditions satisfied |
|  Series 4-4 | 2021-12-31 | 294834 | 294834 | Proportional to service period, vesting conditions satisfied |
|  |  | 1711207 | 1104826 |  |

---

<sup>1</sup> The number of maximum payable shares per executive as at December 31, 2022.

<sup>2</sup> Number of vested shares is determined by performance and paid for a deferred payment schedule over 3 to 5 years.

Share grants are measured at fair value using the Monte Carlo Simulation Model and assumptions used in determining the fair value as at December 31, 2022, are as follows:

---

| | |
|:---|:---|
| *(In Korean won)* | **Risk free<br>rate (%)** |
|  Series 1-1 | 3.777 – 44,859~46,663 |
|  Series 1-8 | 3.777 – 44,859~46,663 |
|  Series 1-10 | 3.777 – 44,859~46,663 |
|  Series 1-11 | 3.777 – 47,631~47,631 |
|  Series 1-13 | 3.777 – 44,859~47,631 |
|  Series 1-19 | 3.777 – 45,096~47,631 |
|  Series 1-21 | 3.777 – 43,157~50,973 |
|  Series 1-22 | 3.777 – 43,157~56,379 |
|  Series 1-23 | 3.777 – 45,096~56,379 |
|  Series 1-24 | 3.777 – 45,096~56,379 |
|  Series 1-25 | 3.777 – 45,096~56,379 |
|  Series 1-26 | 3.777 – 45,096~56,379 |
|  Series 1-27 | 3.777 – 45,096~56,379 |
|  Series 1-28 | 3.777 – 43,157~56,379 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(In Korean won)* | **Risk free<br>rate (%)** | **Fair value (Market<br>performance condition)** | **Fair value (Non-market<br>performance condition)** |
|  Series 1-29 | 3.777 |  | 45,096~56,379 |
|  Series 1-30 | 3.777 |  | 43,157~56,379 |
|  Series 1-31 | 3.777 |  | 45,096~56,379 |
|  Series 1-32 | 3.777 |  | 41,548~44,859 |
|  Series 1-33 | 3.777 |  | 44,859~56,379 |
|  Series 1-34 | 3.777 |  | 44,859~50,973 |
|  Series 1-35 | 3.777 |  | 45,096~56,379 |
|  Series 1-36 | 3.777 |  | 44,859~50,973 |
|  Series 1-37 | 3.777 |  | 41,548~56,379 |
|  Series 1-38 | 3.777 | 43,157~50,973 | 43,157~46,663 |
|  Series 1-39 | 3.777 | 43,157~50,973 | 43,157~46,663 |
|  Series 1-40 | 3.777 | 40,757~48,322 | 43,157~50,973 |
|  Series 1-41 | 3.777 | 41,033~46,084 | 41,548~44,859 |
|  Series 1-42 | 3.777 | 39,520~44,386 | 41,548~44,859 |
|  Series 1-43 | 3.777 |  | 44,859~50,973 |
|  Series 1-44 | 3.777 | 39,458~44,316 | 41,548~44,859 |
|  Series 1-45 | 3.777 | 41,174~46,243 | 41,548~44,859 |
|  Series 1-46 | 3.777 | 40,609~45,608 | 41,548~44,859 |
|  Series 1-47 | 3.777 | 37,410~62,269 | 41,548~48,461 |
|  Series 1-48 | 3.777 | 35,287~39,615 | 39,958~43,157 |
|  Series 1-49 | 3.777 | 39,057~46,131 | 43,157~46,663 |
|  Series 1-50 | 3.777 | 37,824~42,464 | 39,958~43,157 |
|  Series 1-51 | 3.777 | 38,831~49,087 | 39,958~46,663 |
|  Series 1-52 | 3.777 | 38,040~42,706 | 39,958~43,157 |
|  Series 2-3 | 3.777 |  | 43,157~50,973 |
|  Series 2-4 | 3.777 |  | 43,157~56,379 |
|  Series 2-5 | 3.777 |  | 41,548~56,379 |
|  Series 2-6 | 3.777 |  | 41,548~56,379 |
|  Series 2-7 | 3.777 |  | 41,548~56,379 |
|  Series 2-8 | 3.777 |  | 41,548~57,941 |
|  Series 2-9 | 3.777 |  | 39,958~48,461 |
|  Series 3-3 | 3.777 |  | 43,157~50,973 |
|  Series 3-4 | 3.777 |  | 43,157~50,973 |
|  Series 3-5 | 3.777 |  | 43,157~56,379 |
|  Series 3-6 | 3.777 |  | 41,548~56,379 |
|  Series 3-7 | 3.777 |  | 41,548~56,379 |
|  Series 3-8 | 3.777 |  | 41,548~50,973 |
|  Series 4-1 | 3.777 |  | 45,096~56,379 |
|  Series 4-2 | 3.777 |  | 50,973~50,973 |
|  Series 4-3 | 3.777 |  | 46,663~50,973 |
|  Series 4-4 | 3.777 |  | 44,859~50,973 |

---

The Group used the volatility of the stock price over the previous year as the expected volatility and used the dividend yield as the arithmetic mean of the dividend rate of one year before, two years before, and three years before the base year, in order to calculate fair value. Fair value is calculated based on risk free interest rate of 1 year-KTB rate.

In relation to the above share-based arrangements, the compensation cost amounting to W 63,905,175 thousand and W 63,084,932 thousand are recorded as accrued expenses to KB Financial Group Inc. as at December 31, 2022 and 2021, respectively.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**34. Non-operating Income and Non-operating Expenses** 

The details of non-operating income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Gain on disposal of property and equipment | 1499486 | 170470 |
|  Gain on disposal of investment properties | 601745 | 6235168 |
|  Gain on disposal of intangible assets |  | 3362 |
|  Reversal of impairment loss on intangible assets | 394684 | 2630059 |
|  Reversal of revaluation loss for property and equipment | 72800 |  |
|  Rent | 6280529 | 7012044 |
|  Gain related to investments in associates | 16002191 | 21161907 |
|  Gain on disposal of assets held for sale | 8967270 |  |
|  Others | 66898514 | 10916516 |
|  | 100717219 | 48129526 |

---

The details of non-operating expenses for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Loss on disposal of property and equipment | 292841 | 184710 |
|  Loss on disposal of investment properties | 29912 |  |
|  Depreciation of investment properties | 468531 | 487447 |
|  Loss on disposal of intangible assets | 22000 | 40656 |
|  Impairment loss on intangible assets | 1028751 | 121016 |
|  Revaluation loss for property and equipment | 451905 |  |
|  Donation | 8064498 | 7064214 |
|  Loss related to investments in associates | 12962791 | 6678563 |
|  Others | 60064385 | 36783589 |
|  | 83385614 | 51360195 |

---

**35. Tax Expense and Deferred Tax** 

The details of income tax expense for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Current tax |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current tax on profits for the year | 60368151 | 214168680 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustments in respect of prior years | (1091538) | 2530896 |
|  Deferred tax |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Origination and reversal of temporary differences | 41473246 | 11962477 |
|  Tax recognized directly in equity |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation for financial assets at FVOCI | (2162640) | (4008037) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Shares of other comprehensive income of associates | 244705 | (67) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on revaluation of property and equipment | (12328212) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of net defined benefit liabilities | (1040964) | 848738 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign operations translation | (8817090) | (3571779) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hedge of net investments in foreign operations | 1823373 | 4962342 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes on the fair value of financial liabilities designated at FVTPL due to the change of credit risk | (13967207) | (5202092) |
|  Tax effect derived from group's income tax system | 2997367 | (3938930) |
|  Income tax expense | 67499191 | 217752228 |

---

Reconciliations of profit before tax and tax expense for the years ended December 31, 2022 and 2021, are as follows:

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Profit before tax (A) | 262326853 | 818043644 |
|  Tax based on statutory rate | 63021098 | 214600002 |
|  Adjustments |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-deductible expense | 4321064 | 5549618 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-taxable income | (3968641) | (1197227) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in deferred tax assets (liabilities) that have<br> not been recognized | (8763046) | (14833564) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Effect from tax reduction and credit | (201610) | (81033) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustment in respect of prior years | (1091537) | 2530896 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tax effect from group's income tax system | 2997367 | (3938930) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in tax rate | 2045539 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 9138957 | 15122466 |
|  Tax expense (B) | 67499191 | 217752228 |
|  Effective tax rate (B/A) | 25.73% | 26.62% |

---

The changes in deferred tax assets (liabilities) for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Profit (loss) for<br>the year** | **Other<br>comprehensive<br>income** | **Ending**<br> **balance** |
|  Provision for impairment | 142086 | (5167) |  | 136919 |
|  Commissions income | 4622730 | 3180864 |  | 7803594 |
|  Financial assets at FVOCI | (79210178) | (4561632) | (2162640) | (85934450) |
|  Defined benefit obligation | 19501520 | (640015) | (1040964) | 17820541 |
|  Other long-term employee benefits | 2098484 | (196781) |  | 1901703 |
|  Financial assets at FVTPL | 55244765 | 139967430 |  | 195212195 |
|  Financial liabilities at FVTPL | (49107485) | (244071368) | (13967207) | (307146060) |
|  Accrued expenses | 75757563 | (21294658) |  | 54462905 |
|  Dividends (specific overseas company) | 10545651 | (1126588) |  | 9419063 |
|  Accrued income | (22988746) | (1787714) |  | (24776460) |
|  Property and equipment | (9782627) | 75168 | (12328212) | (22035671) |
|  Provisions for asset retirement obligation | 2199329 | 133270 |  | 2332599 |
|  Investments in associates and subsidiaries | 1747824 | (1911192) |  | (163368) |
|  Derivatives | (57458767) | 102627090 |  | 45168323 |
|  Loans | 1584488 | 20228 |  | 1604716 |
|  Intangible assets | (20530350) | 297978 |  | (20232372) |
|  Plan assets | (4206052) | 912075 |  | (3293977) |
|  Advance depreciation provision | (2501796) | 90974 |  | (2410822) |
|  Interest related to loan for construction | (64951) | 6099 |  | (58852) |
|  Others | 40214857 | 11912773 |  | 52127630 |
|  Subtotal | (32191655) | (16371166) | (29499023) | (78061844) |
|  Unrecognized deferred tax assets (liabilities) of the Parent Company | (3604707) | (612030) |  | (4216737) |
|  Deferred tax assets (liabilities) of the Parent Company, net <sup>1</sup> | (28586948) | (15759136) | (29499023) | (73845107) |
|  Deferred tax assets of subsidiaries |  | 1289260 |  | 1289260 |
|  Deferred tax liabilities of subsidiaries | (2825915) | 42620 |  | (2783295) |
|  Changes in deferred tax assets due to adjustment of consolidation | 14534394 | 10491306 | (6749012) | 18276688 |
|  Deferred tax assets of the Group |  | 1289260 |  | 1289260 |
|  Deferred tax liabilities of the Group | (16878469) | (5225210) | (36248035) | (58351714) |

---

<sup>1</sup> The income tax rates used in computing deferred tax assets (liabilities) are the expected average tax rate, which is applicable to the forecasted period when the temporary differences are reversed.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Profit (loss) for<br>the year** | **Other<br>comprehensive<br>income** | **Ending<br>balance** |
|  Provision for impairment | 142086 |  |  | 142086 |
|  Commissions income | 5354729 | (731999) |  | 4622730 |
|  Financial assets at FVOCI | (77700924) | 2498783 | (4008037) | (79210178) |
|  Defined benefit obligation | 19879337 | (1226555) | 848738 | 19501520 |
|  Other long-term employee benefits | 1637421 | 461063 |  | 2098484 |
|  Financial assets at FVTPL | (36226370) | 91471135 |  | 55244765 |
|  Financial liabilities at FVTPL | 83623426 | (127528819) | (5202093) | (49107485) |
|  Accrued expenses | 68421675 | 7335888 |  | 75757563 |
|  Dividends (specific overseas company) | 10809313 | (263662) |  | 10545651 |
|  Accrued income | (22546280) | (442466) |  | (22988746) |
|  Property and equipment | (9816743) | 34116 |  | (9782627) |
|  Provisions for asset retirement obligation | 2231568 | (32239) |  | 2199329 |
|  Investments in associates and subsidiaries | (643340) | 2391164 |  | 1747824 |
|  Derivatives | (70377421) | 12918654 |  | (57458767) |
|  Loans | 170188 | 1414300 |  | 1584488 |
|  Intangible assets | (20771808) | 241458 |  | (20530350) |
|  Plan assets | (5129321) | 923269 |  | (4206052) |
|  Advance depreciation provision | (2560369) | 58573 |  | (2501796) |
|  Interest related to loan for construction | (68829) | 3878 |  | (64951) |
|  Others | 35891000 | 4323857 |  | 40214857 |
|  Subtotal | (17680662) | (6149602) | (8361391) | (32191655) |
|  Unrecognized deferred tax assets (liabilities) of the Parent Company | (3304176) | (300531) |  | (3604707) |
|  Deferred tax assets (liabilities) of the Parent Company, net <sup>1</sup> | (14376486) | (5849071) | (8361391) | (28586948) |
|  Deferred tax assets of subsidiaries |  |  |  |  |
|  Deferred tax liabilities of subsidiaries | (689208) | (2136707) |  | (2825915) |
|  Changes in deferred tax assets due to adjustment of consolidation | 10149702 | 2994197 | 1390495 | 14534394 |
|  Deferred tax assets of the Group |  |  |  |  |
|  Deferred tax liabilities of the Group | (4915992) | (4991581) | (6970896) | (16878469) |

---

<sup>1</sup> The income tax rates used in computing deferred tax assets (liabilities) are the expected average tax rate, which is applicable to the forecasted period when the temporary differences are reversed.

Temporary differences which were not recognized due to uncertainty of their realization as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Taxable temporary difference |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in subsidiaries | 117273403 | 85576474 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Intangible assets | 58888990 | 58888990 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 445550 | 445550 |
|  | 176607943 | 144911014 |
|  Deductible temporary difference |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Commission (local subsidiary) | 7512805 | 7512805 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends (specific overseas company) | 35543632 | 38347821 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in subsidiaries | 20188708 | 18755689 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 2705305 | 2705305 |
|  | 65950450 | 67321620 |
|  | 110657493 | 77589394 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Details of income taxes that are charged or credited directly to equity for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Recognized in other comprehensive income |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation for financial assets at FVOCI | (39698) | (4768491) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Shares of other comprehensive income of associates | 244705 | (67) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on revaluation of property and equipment | (12328212) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of net defined benefit liabilities | (1040964) | 848738 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign operations translation | (8817090) | (3571779) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hedge of net investments in foreign operations | 1823373 | 4962342 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes on the fair value of financial liabilities designated at FVTPL due to the change of credit risk | (13967207) | (5202092) |
|  Reclassified to profit or loss |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation for financial assets at FVOCI | (2122942) | 760454 |
|  | (36248035) | (6970895) |

---

**36. Carrying Amounts of Financial Instruments by Category** 

Financial assets and liabilities are measured at fair value or amortised cost. Measurement policies for each category of financial assets and financial liabilities are disclosed in Note 2, 'Significant accounting policies'.

The carrying amounts of financial assets and liabilities by category as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Financial asset<br>measured at fair<br>value through**<br> **profit or loss** | **Financial asset<br>measured at<br>amortised cost** | **Financial asset<br>measured at fair<br>value through**<br> **other<br>comprehensive<br>income** | **Totals** |
|  **Financial Assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits |  | 4537576194 |  | 4537576194 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial Assets at FVTPL | 29549677944 |  |  | 29549677944 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives | 1724310258 |  |  | 1724310258 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity instruments at FVOCI |  |  | 687825614 | 687825614 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt instruments at FVOCI |  |  | 4112728624 | 4112728624 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost |  | 8907503612 |  | 8907503612 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  | 2687932514 |  | 2687932514 |
|  | 31273988202 | 16133012320 | 4800554238 | 52207554760 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Financial<br>liabilities<br>measured at**<br> **fair value<br>through**<br> **profit or loss** | **Financial<br>liabilities<br>designated at**<br> **fair value**<br> **through profit**<br> **or loss** | **Financial<br>liabilities<br>measured at<br>amortised cost** | **Derivative<br>liabilities<br>(hedging)** | **Totals** |
|  **Financial Liabilities** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL |  | 10088600213 |  |  | 10088600213 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL | 2082979265 |  |  |  | 2082979265 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities | 2310859900 |  |  | 11616190 | 2322476090 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit liabilities |  |  | 6799233076 |  | 6799233076 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  | 23523195868 |  | 23523195868 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  |  | 2389541471 |  | 2389541471 |
|  | 4393839165 | 10088600213 | 32711970415 | 11616190 | 47206025983 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Financial asset<br>measured at fair<br>value through**<br> **profit or loss** | **Financial asset<br>measured at<br>amortised cost** | **Financial asset<br>measured at fair<br>value through**<br> **other comprehensive<br>income** | **Totals** |
|  **Financial Assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits |  | 3834048675 |  | 3834048675 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial Assets at FVTPL | 34182334301 |  |  | 34182334301 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives | 817518307 |  |  | 817518307 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity instruments at FVOCI |  |  | 447232312 | 447232312 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt instruments at FVOCI |  |  | 3392645494 | 3392645494 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost |  | 7186208182 |  | 7186208182 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  | 3661821845 |  | 3661821845 |
|  | 34999852608 | 14682078702 | 3839877806 | 53521809116 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Financial<br>liabilities<br>measured at**<br> **fair value<br>through**<br> **profit or loss** | **Financial<br>liabilities<br>designated at<br>fair value<br>through profit<br>or loss** | **Financial<br>liabilities<br>measured at<br>amortised cost** | **Derivative<br>liabilities<br>(hedging)** | **Totals** |
|  **Financial Liabilities** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL |  | 9160923652 |  |  | 9160923652 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL | 2825922918 |  |  |  | 2825922918 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities | 857388295 |  |  | 17253447 | 874641742 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit liabilities |  |  | 8391075183 |  | 8391075183 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  | 24649381850 |  | 24649381850 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  |  | 3484650271 |  | 3484650271 |
|  | 3683311213 | 9160923652 | 36525107304 | 17253447 | 49386595616 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**37. Financial Instruments** 

**37.1 Fair Value of Financial Instruments by Class** 

Fair values of financial assets and financial liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Carrying<br>amount** | **Fair value** | **Carrying<br>amount** | **Fair value** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits <sup>2</sup> | 4537576194 | 4537576194 | 3834048675 | 3834048675 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL <sup>1</sup> | 29549677944 | 29549677944 | 34182334301 | 34182334301 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets <sup>1</sup> | 1724310258 | 1724310258 | 817518307 | 817518307 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVOCI | 4800554238 | 4800554238 | 3839877806 | 3839877806 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost | 8907503612 | 8885090216 | 7186208182 | 7193418373 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets<sup>2</sup> | 2687932514 | 2687932514 | 3661821845 | 3661821845 |
|  | 52207554760 | 52185141364 | 53521809116 | 53529019307 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Carrying<br>amount** | **Fair value** | **Carrying<br>amount** | **Fair value** |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit liabilities <sup>2</sup> | 6799233076 | 6799233076 | 8391075183 | 8391075183 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL | 2082979265 | 2082979265 | 2825922918 | 2825922918 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL<sup>1</sup> | 10088600213 | 10088600213 | 9160923652 | 9160923652 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities<sup>1</sup> | 2322476090 | 2322476090 | 874641742 | 874641742 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings | 23523195868 | 23460054713 | 24649381850 | 24636652379 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities<sup>2</sup> | 2389541471 | 2389541471 | 3484650271 | 3484650271 |
|  | 47206025983 | 47142884828 | 49386595616 | 49373866145 |

---

<sup>1</sup> Deferred transaction gain or losses are adjusted in the carrying amount. 

<sup>2</sup> The fair value of cash and deposits, other financial assets, deposit liabilities and other financial liabilities with short maturity dates or uncertain maturity dates are presented at their book amounts. 

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. For each class of financial assets and financial liabilities, the Group discloses the fair value of that class of assets and liabilities in a way that permits it to be compared with its carrying amount at the end of each reporting period. The best evidence of fair value of financial instruments is a quoted price in an active market.

**37.2 Fair Value Hierarchy** 

Financial instruments measured at fair value are categorized within the fair value hierarchy, and the defined levels are as follows:

---

| | |
|:---|:---|
| Level 1 | Quoted prices (unadjusted) in active markets for identical assets or liabilities |
| Level 2 | Fair value using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, prices) or indirectly (that is, derived from prices) |
| Level 3 | Fair value using inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The inputs used to measure the fair value of an asset or a liability might be categorized within different levels of the fair value hierarchy. In those cases, the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. The observable input is generally used to the Fair value measurement. However, if an observable input requires an adjustment using an unobservable input and that adjustment results in a significantly higher or lower fair value measurement, the resulting measurement would be categorized within Level 3 of the fair value hierarchy.

(a) Fair value hierarchy of financial instruments measured at fair value

The fair value hierarchy of financial assets and liabilities measured at fair value as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL – debt instruments <sup>1</sup> | 6264846729 | 19561321806 | 2437013557 | 28263182092 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL - equity instruments | 499336398 | 568075509 | 219083945 | 1286495852 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets<sup>1</sup> | 98643416 | 1504891727 | 120775115 | 1724310258 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVOCI | 5025406 | 4372289778 | 423239054 | 4800554238 |
|  | 6867851949 | 26006578820 | 3200111671 | 36074542440 |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL | 2082979265 |  |  | 2082979265 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL<sup>1</sup> | 35687313 | 1811403735 | 8241509165 | 10088600213 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities<sup>1</sup> | 423867393 | 1121066848 | 777541849 | 2322476090 |
|  | 2542533971 | 2932470583 | 9019051014 | 14494055568 |

---

<sup>1</sup> Deferred transaction gain or losses are adjusted in the carrying amount. 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL – debt instruments <sup>1</sup> | 7098545069 | 24218855218 | 1766441297 | 33083841584 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL - equity instruments | 380241477 | 585355259 | 132895981 | 1098492717 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets<sup>1</sup> | 68654003 | 539055644 | 209808660 | 817518307 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVOCI | 20989065 | 3450533070 | 368355671 | 3839877806 |
|  | 7568429614 | 28793799191 | 2477501609 | 38839730414 |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL | 2825922918 |  |  | 2825922918 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL<sup>1</sup> | 36937827 | 1294944846 | 7829040979 | 9160923652 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities<sup>1</sup> | 198052673 | 508125157 | 168463912 | 874641742 |
|  | 3060913418 | 1803070003 | 7997504891 | 12861488312 |

---

<sup>1</sup> Deferred transaction gain or losses are adjusted in the carrying amount. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**37.3 Valuation techniques and inputs classified by Level 2** 

The details of the valuation techniques and inputs classified by Level 2 as at December 31, 2022 and 2021 are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **Valuation techniques** | **Inputs** |
| Financial assets at FVTPL | 20129397315 | DCF Model, Closed form formula, Monte Carlo model, Black Scholes model, Hull and White Model, Net asset value<br> and others | Price of underlying asset, interest rate, dividend rate, volatility, discount rate and others |
| Derivative financial assets(trading) | 1504891727 | DCF Model, Closed form formula, Monte Carlo model, Black Scholes model, Hull and White Model, Net asset value and others | Interest rate, price of underlying asset, exchange rate, credit spread, discount rate, volatility and others |
| Financial assets at FVOCI | 4372289778 | DCF Model | Discount rate, Interest rate and others |
|  | 26006578820 |  |  |
| Financial liabilities designated at FVTPL | 1811403735 | DCF Model, Closed form formula, Monte Carlo model, Black Scholes model, Hull and White Model, Net asset value and others | Price of underlying asset, interest rate, dividend rate, volatility, discount rate |
| Derivative financial liabilities(trading) | 1109450658 | DCF Model, Closed form formula, Monte Carlo model, Black Scholes model, Hull and White Model, Net asset value and others | Interest rate, price of underlying asset, exchange rate, credit spread, discount rate, volatility |
| Derivative financial liabilities(hedging) | 11616190 | DCF Model | Discount rate, exchange rate and others |
|  | 2932470583 |  |  |

---

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **Valuation techniques** | **Inputs** |
| Financial assets at FVTPL | 24804210477 | DCF Model, Closed form formula, Monte Carlo model, Black Scholes model, Hull and White Model, Net asset value<br> and others | Price of underlying asset, interest rate, dividend rate, volatility, discount rate and others |
| Derivative financial assets(trading) | 539055644 | DCF Model, Closed form formula, Monte Carlo model, Black Scholes model, Hull and White Model, Net asset value and others | Interest rate, price of underlying asset, exchange rate, credit spread, discount rate, volatility and others |
| Financial assets at FVOCI | 3450533070 | DCF Model | Discount rate, Interest rate and others |
|  | 28793799191 |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| Financial liabilities designated at FVTPL | 1294944846.0 | DCF Model, Closed form formula, Monte Carlo model, Black Scholes model, Hull and White Model, Net asset value and others | Price of underlying asset, interest rate, dividend rate, volatility, discount rate |
| Derivative financial liabilities(trading) | 490871710.0 | DCF Model, Closed form formula, Monte Carlo model, Black Scholes model, Hull and White Model, Net asset value and others | Interest rate, price of underlying asset, exchange rate, credit spread, discount rate, volatility |
| Derivative financial liabilities(hedging) | 17253447.0 | DCF Model | Discount rate, exchange rate and others |
|  | 1803070003.0 |  |  |

---

**37.4 Level 3 of the Fair Value Hierarchy Disclosure** 

(a) Valuation Process for Fair Value Measurements Categorized Within Level 3 of the Fair Value Hierarchy

The fair value of financial instruments classified as Level 3 is determined by external valuation or self-valuation of the Group. Unobservable inputs are produced by the external appraiser or internal valuation system and the Group reviews the adequacy of inputs. The risk management council reviews the adequacy of the assessment methodology and valuation method of external appraiser and the internal valuation. The agenda of the risk management council is to be reported or approved by the risk committee.

(b) Changes in Recurring Fair Value Measurements Categories of the Fair Value hierarchy

The changes in financial instruments with Level 3 fair value for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Financial assets**<br> **at FVTPL** | **Financial assets**<br> **at FVOCI** | **Net derivatives** | **Financial liabilities**<br> **designated at<br>FVTPL** |
|  Beginning balance | 1899337278 | 368355671 | 41344748 | (7829040979) |
|  Total gains or losses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit or loss | (70107637) |  | (666119493) | 563317417 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other comprehensive income |  | 54800585 |  | 60520089 |
|  Purchases | 1182931242 | 82798 | 23525783 |  |
|  Sales | (361277691) |  | (59177496) |  |
|  Issues |  |  | (14796230) | (5222820340) |
|  Settlements |  |  | 18455954 | 4186514648 |
|  Transfer within levels <sup>1</sup> | 5214310 |  |  |  |
|  Ending balance | 2656097502 | 423239054 | (656766734) | (8241509165) |

---

<sup>1</sup> Transfer within levels are occurred due to the change in the availability of observable market data on the financial instruments.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Financial assets**<br> **at FVTPL** | **Financial assets**<br> **at FVOCI** | **Net derivatives** | **Financial liabilities**<br> **designated at<br>FVTPL** |
|  Beginning balance | 2243728926 | 309827598 | 306841321 | (9214284213) |
|  Total gains or losses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit or loss | (1738868) |  | (66664335) | 63081409 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other comprehensive income |  | 39940672 |  | (5445079) |
|  Purchases | 882820430 | 18587401 | 3952205 |  |
|  Sales | (1227448847) |  | (169985927) |  |
|  Issues |  |  | (32516161) | (8233127666) |
|  Settlements |  |  |  | 9560734570 |
|  Transfer within levels <sup>1</sup> | 1975637 |  | (282355) |  |
|  Ending balance | 1899337278 | 368355671 | 41344748 | (7829040979) |

---

<sup>1</sup> Transfer within levels are occurred due to the change in the availability of observable market data on the financial instruments.

In relation to changes in Level 3 fair value, total gains or losses related to the asset and liabilities held at the reporting date are included in the statements of comprehensive income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Financial assets**<br> **at FVTPL** | **Financial assets**<br> **at FVOCI** | **Net derivatives** | **Financial liabilities**<br> **designated at<br>FVTPL** |
|  **Profit or loss** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation of financial instruments<sup>1</sup> | (84556890) |  | (558677313) | 726467752 |
|  **Other comprehensive income** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation of financial assets at FVOCI<sup>2</sup> |  | 54800585 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in fair value of financial liabilities at FVTPL due to the change of credit risk<sup>2</sup> |  |  |  | 56580809 |
|  | (84556890) | 54800585 | (558677313) | 783048561 |

---

<sup>1</sup> Included in gain or loss on valuation and disposal of financial instruments on the statements of Profit or Loss.

<sup>2</sup> Included in other comprehensive income on the statements of comprehensive income.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Financial assets**<br> **at FVTPL** | **Financial assets**<br> **at FVOCI** | **Net derivatives** | **Financial liabilities**<br> **designated at<br>FVTPL** |
|  **Profit or loss** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation of financial instruments<sup>1</sup> | (27667310) |  | (109925653) | 105096746 |
|  **Other comprehensive income** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation of financial assets at FVOCI<sup>2</sup> |  | 39940672 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in fair value of financial liabilities at FVTPL due to the change of credit risk<sup>2</sup> |  |  |  | 6607886 |
|  | (27667310) | 39940672 | (109925653) | 111704632 |

---

<sup>1</sup> Included in gain or loss on valuation and disposal of financial instruments on the statements of Profit or Loss.

<sup>2</sup> Included in other comprehensive income on the statements of comprehensive income.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

(c) Valuation techniques and the Inputs classified by Level 3

Valuation techniques and inputs for level 3 financial instruments are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of<br>Korean won)* | **Type** | **Fair value** | **Valuation<br>techniques** | **Inputs** | **Unobservable**<br> **input** | **Range** | **Relevance** |
| Financial assets at FVTPL | Equity-linked securities | 10127847 | DCF model, Closed Form, Monte Carlo | Price of underlying asset, interest rate, | Underlying asset volatility | 0.22 ~ 0.25 | Proportional |
| Financial assets at FVTPL | Equity-linked securities | 10127847 | DCF model, Closed Form, Monte Carlo | Price of underlying asset, interest rate, | Correlation | -0.37 ~ 0.73 | Proportional |
|  | Other derivative linked securities | 162897287 | Simulation, Hull and White, | discount rate, dividend ratio, | Underlying asset volatility | 0.25 ~ 0.33 | Proportional |
|  |  |  | Black-Scholes Model, Net asset value, etc. | volatility of underlying assets, correlation of underlying assets, | Correlation | 0.12 ~ 0.93 | Proportional |
|  | Other OTC derivative linked contract | 231308457 | Black-Scholes Model, Net asset value, etc. | volatility of underlying assets, correlation of underlying assets, | Underlying asset volatility | 0.19 ~ 0.36 | Proportional |
|  |  |  |  | volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.76 | Proportional |
|  | Debt instruments | 2032679966 |  | volatility of interest rate, probability of default | Underlying asset volatility | 0.24 ~ 0.36 | Proportional |
|  | Equity instruments<sup>1</sup> | 219083945 |  |  | Discount rate | 0.08 ~ 0.23 | Inversely proportional |
| Derivative financial assets (trading) |  | 120775115 |  |  | Underlying asset volatility | 0.10 ~ 0.59 | Proportional |
| Derivative financial assets (trading) |  | 120775115 |  |  | Correlation | -0.60 ~ 0.93 | Proportional |
| Financial assets at FVOCI | Equity instruments | 423239054 | DCF model, Risk-adjusted discount rate model, IMV model and others | Growth rate, discount rate | Growth rate | 0.01 ~ 0.01 | Proportional |
| Financial assets at FVOCI | Equity instruments | 423239054 | DCF model, Risk-adjusted discount rate model, IMV model and others | Growth rate, discount rate | Discount rate | 0.11 ~ 0.13 | Inversely proportional |
|  |  | 3200111671 |  |  |  |  |  |
| Financial liabilities designated at FVTPL | Equity-linked securities sold | 6726257399 | DCF model, Closed Form, Monte Carlo | Price of underlying asset, interest rate, discount rate, | Underlying asset volatility | 0.19 ~ 0.59 | Proportional |
| Financial liabilities designated at FVTPL | Equity-linked securities sold | 6726257399 | DCF model, Closed Form, Monte Carlo | Price of underlying asset, interest rate, discount rate, | Correlation | -0.60 ~ 0.80 | Proportional |
|  | Derivatives linked securities sold | 1321382570 | Simulation, Hull and White, Black-Scholes Model, Net asset | dividend ratio, volatility of underlying assets, correlation of | Underlying asset volatility | 0.01 ~ 1.19 | Proportional |
|  |  | 1321382570 | Simulation, Hull and White, Black-Scholes Model, Net asset | dividend ratio, volatility of underlying assets, correlation of | Correlation | -0.50 ~ 0.93 | Proportional |
|  | Other OTC derivatives linked contract sold<sup>1</sup> | 193869196 | value, etc. | underlying assets, volatility of interest rate, probability of | Underlying asset volatility | 0.19 ~ 0.32 | Proportional |
|  |  |  |  | default | Correlation | -0.60 ~ 0.73 | Proportional |
| Derivative financial liabilities (trading) |  | 777541849 |  |  | Underlying asset volatility | 0.09 ~ 1.19 | Proportional |
| Derivative financial liabilities (trading) |  | 777541849 |  |  | Correlation | -0.60 ~ 0.93 | Proportional |
|  |  | 9019051014 |  |  |  |  |  |

---

<sup>1</sup> Derivatives which derive their value from interest rate, stock price, foreign exchange rate, commodity price, credit rate and others are included.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Type** | **Fair value** | **Valuation techniques** | **Inputs** | **Unobservable**<br> **input** | **Range** | **Relevance** |
| Financial assets at FVTPL | Other derivative linked securities | 29067962 | DCF model, Closed Form, Monte Carlo Simulation, Hull and | Price of underlying asset, interest rate, | Underlying asset volatility | 0.26 ~ 0.54 | Proportional |
| Financial assets at FVTPL | Other derivative linked securities | 29067962 | DCF model, Closed Form, Monte Carlo Simulation, Hull and | Price of underlying asset, interest rate, | Correlation | 0.08 ~ 0.90 | Proportional |
|  | Other OTC derivative linked contract | 99015526 | White, Black-Scholes Model, Net asset value, etc. | discount rate, dividend ratio, volatility of underlying assets, | Underlying asset volatility | 0.16 ~ 0.26 | Proportional |
|  |  |  | White, Black-Scholes Model, Net asset value, etc. | discount rate, dividend ratio, volatility of underlying assets, | Correlation | -0.60 ~ 0.77 | Proportional |
|  | Debt instruments | 1638357809 |  | correlation of underlying assets, | Underlying asset volatility | 0.14 ~ 0.30 | Proportional |
|  | Equity instruments<sup>1</sup> | 132895981 |  | volatility of interest rate, probability of | Discount rate | 0.10 ~ 0.25 | Inversely proportional |
| Derivative financial assets (trading) |  | 209808660 |  | default | Underlying asset volatility | 0.03 ~ 0.81 | Proportional |
| Derivative financial assets (trading) |  | 209808660 |  |  | Correlation | -0.60 ~ 0.90 | Proportional |
| Financial assets at FVOCI | Equity instruments | 368355671 | DCF model, Risk-adjusted discount rate model, IMV model and others | Growth rate, discount rate | Growth rate | 0.01 ~ 0.01 | Proportional |
| Financial assets at FVOCI | Equity instruments | 368355671 | DCF model, Risk-adjusted discount rate model, IMV model and others | Growth rate, discount rate | Discount rate | 0.11 ~ 0.15 | Inversely proportional |
|  |  | 2477501609 |  |  |  |  |  |
| Financial liabilities designated at | Equity-linked securities sold | 6117086280 | DCF model, Closed Form, Monte Carlo Simulation, Hull and | Price of underlying asset, interest rate, discount rate, | Underlying asset volatility | 0.15 ~ 0.81 | Proportional |
| FVTPL |  |  | White, Black-Scholes | dividend ratio, | Correlation | -0.60 ~ 0.88 | Proportional |
|  | Derivatives linked securities sold | 1567907416 | Model, Net asset value, etc. | volatility of underlying assets, correlation of underlying assets, | Underlying asset volatility | 0.01 ~ 0.81 | Proportional |
|  |  | 1567907416 | Model, Net asset value, etc. | volatility of underlying assets, correlation of underlying assets, | Correlation | -0.48 ~ 0.90 | Proportional |
|  | Other OTC derivatives linked contract sold<sup>1</sup> | 144047283 |  | volatility of interest rate, probability of default | Underlying asset volatility | 0.15 ~ 0.30 | Proportional |
|  |  |  |  |  | Correlation | -0.60 ~ 0.74 | Proportional |
| Derivative financial liabilities (trading) |  | 168463912 |  |  | Underlying asset volatility | 0.05 ~ 0.81 | Proportional |
|  |  | 168463912 |  |  | Correlation | -0.60 ~ 0.90 | Proportional |
|  |  | 7997504891 |  |  |  |  |  |

---

<sup>1</sup> Derivatives which derive their value from interest rate, stock price, foreign exchange rate, commodity price, credit rate and others are included.

(d) Sensitivity Analysis of Recurring Fair Value Measurements Categorized Within Level 3 of the Fair Value
Hierarchy

Sensitivity analysis of financial instruments is performed to measure favorable and unfavorable changes in the fair value of financial instruments which are affected by the unobservable inputs, using a statistical technique. When the fair value is affected by more than two inputs, the amounts represent the most favorable or most unfavorable.

The results of the sensitivity analysis for the effect on profit or loss from changes in inputs for each financial instrument as at December 31, 2022 and 2021, are as follows.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
|  | **Profit and loss** | **Profit and loss** | **Other comprehensive income** | **Other comprehensive income** |
| *(in thousands of Korean won)* | **Favorable<br>changes** | **Unfavorable<br>changes** | **Favorable<br>changes** | **Unfavorable<br>changes** |
|  **Financial assets** |  |  |  |  |
|  Financial assets at FVTPL<sup>1</sup> | 19476498 | (16155942) |  |  |
|  Derivative financial assets <sup>1</sup> | 17639228 | (18599459) |  |  |
|  Financial assets at FVOCI <sup>2</sup> |  |  | 31718711 | (21878733) |
|  | 37115726 | (34755401) | 31718711 | (21878733) |
|  **Financial liabilities** |  |  |  |  |
|  Financial liabilities designated at FVTPL<sup>1</sup> | 94000806 | (97663062) |  |  |
|  Derivative financial liabilities <sup>1</sup> | 48696201 | (46355477) |  |  |
|  | 142697007 | (144018539) |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

<sup>1</sup> Measured by changes in fair value based on the increased or decreased unobservable volatility of underlying assets by 10% or unobservable input(growth rate and discount rate) by 1%. 

<sup>2</sup> Measured by changes in fair value based on growth rate ((-)1~1%) and discount rate ((-)1~1%) that are unobservable inputs. 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
|  | **Profit and loss** | **Profit and loss** | **Other comprehensive income** | **Other comprehensive income** |
| *(in thousands of Korean won)* | **Favorable<br>changes** | **Unfavorable<br>changes** | **Favorable<br>changes** | **Unfavorable<br>changes** |
|  **Financial assets** |  |  |  |  |
|  Financial assets at FVTPL<sup>1</sup> | 7774418 | (6273350) |  |  |
|  Derivative financial assets <sup>1</sup> | 19235324 | (19935240) |  |  |
|  Financial assets at FVOCI <sup>2</sup> |  |  | 26761121 | (18444528) |
|  | 27009742 | (26208590) | 26761121 | (18444528) |
|  **Financial liabilities** |  |  |  |  |
|  Financial liabilities designated at FVTPL<sup>1</sup> | 78355694 | (82796956) |  |  |
|  Derivative financial liabilities <sup>1</sup> | 31113821 | (29105058) |  |  |
|  | 109469515 | (111902014) |  |  |

---

<sup>1</sup> Measured by changes in fair value based on the increased or decreased unobservable volatility of underlying assets by 10% or unobservable input(growth rate and discount rate) by 1%. 

<sup>2</sup> Measured by changes in fair value based on growth rate ((-)1~1%) and discount rate ((-)1~1%) that are unobservable inputs. 

(e) Day 1 Profit and Loss

If the Group uses a valuation technique that uses data not obtained from observable markets for the fair value at initial recognition of financial instruments, there could be a difference between the transaction price and the amount determined using that valuation technique. In these circumstances, the fair value of financial instruments is recognized as the transaction price and the difference is amortised by using the straight-line method over the life of the financial instruments. If the fair value of the financial instruments can be subsequently determined using observable market inputs, the remaining deferred amount is immediately recognized in profit or loss.

The aggregate difference yet to be recognized in profit or loss at the beginning and end of the year, and the changes in the balance of this difference, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Balances at the beginning of the year (A) | 93995795 | 70759191 |
|  Incurred during the year (B) | 111326521 | 176475408 |
|  Amounts recognized in profit or loss during the year (C) | (121945132) | (153238804) |
|  Balances at the end of year (A+B+C) | 83377184 | 93995795 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**37.5 Fair value hierarchy of financial instruments which the fair value is disclosed** 

(a) The fair value hierarchy of financial assets and liabilities which the fair value is disclosed as at
December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost |  |  | 8885090216 | 8885090216 |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  | 23460054713 | 23460054713 |

---

<sup>1</sup> Cash and deposits, other financial assets, deposit liabilities and other financial liabilities that are used book amount as a substitute for fair value because their maturities are relatively short or are not set, are not disclosed. 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost |  |  | 7193418373 | 7193418373 |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  | 24636652379 | 24636652379 |

---

<sup>1</sup> Cash and deposits, other financial assets, deposit liabilities and other financial liabilities that are used book amount as a substitute for fair value because their maturities are relatively short or are not set, are not disclosed. 

(b) Valuation techniques and inputs

---

| | |
|:---|:---|
|  | **Valuation technique and inputs** |
| Cash and deposits | The fair value of cash is the same as the book amount. The book amount is used as a substitute value of fair value for the majority of deposits consisting of overnight deposits and deposits with variable interest rate. |
| Loans measured at amortised cost | The fair values are calculated by discount rate considering market interest rates and borrower's credit risk on expected cash flows. |
| Deposit liabilities and borrowings | The book amount is used as a substitute value of fair value for demand deposit liabilities, bank overdrafts and call money. With regard to the other deposits and borrowings, the fair values are calculated by discount rate considering residual risks at market interest rates on contractual cash flows. |
| Other financial assets and liabilities | The book amount is used as a substitute value of fair value instead of applying DCF due to the relatively short-term or indefinite maturity. However, DCF method is applied for several long-term receivables or payables. |

---

**37.6 Derecognition of financial assets** 

The Group continues to recognize bonds sold under repurchase agreements and securities lending agreement, because the Group transferred the financial asset, but the assets does not meet the derecognition criteria. Due to the nature of transaction that bonds sold under repurchase agreements has repurchase condition with fixed price and securities lending agreement contains the retransfer back condition by the end of lending period, the Group has almost all risks and rewards related to the ownership of the financial assets.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

As at December 31, 2022 and 2021, relevant information about transferred financial assets which do not qualify for derecognition are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
|  | **Financial assets at FVTPL** | **Financial assets at FVTPL** | **Financial assets at FVOCI** | **Financial assets at FVOCI** |
| *(in thousands of Korean won)* | **Debt<br>instruments<sup>1,2, 3</sup>** | **Equity<br>instruments<sup>2</sup>** | **Debt<br>instruments<sup>1,3</sup>** | **Equity<br>instruments** |
|  Carrying amount of transferred assets | 3728769734 | 52098066 | 2234882535 |  |
|  Carrying amount of related liabilities | 3559217505 |  | 2121560622 |  |

---

<sup>1</sup> Transferred debt instruments under repurchase agreements.

<sup>2</sup> Transferred equity instruments and debt instruments under securities lending agreements.

<sup>3</sup> As at December 31, 2022, the accrued interests related to debt securities of W22,779 million is excluded.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
|  | **Financial assets at FVTPL** | **Financial assets at FVTPL** | **Financial assets at FVOCI** | **Financial assets at FVOCI** |
| *(in thousands of Korean won)* | **Debt<br>instruments<sup>1,2, 3</sup>** | **Equity<br>instruments<sup>2</sup>** | **Debt<br>instruments<sup>1,3</sup>** | **Equity<br>instruments** |
|  Carrying amount of transferred assets | 8452138400 | 253040 | 1990336464 |  |
|  Carrying amount of related liabilities | 8253574637 |  | 1893044535 |  |

---

<sup>1</sup> Transferred debt instruments under repurchase agreements.

<sup>2</sup> Transferred equity instruments and debt instruments under securities lending agreements.

<sup>3</sup> As at December 31, 2021, the accrued interests related to debt securities of W51,550 million is excluded.

Meanwhile, the Group provided additional credit enhancements such as purchase agreements in addition to recourse limited to transferred assets to subsidiaries established for asset securitization purposes.

Details of carrying amounts of the underlying assets and the associated liabilities as of December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(In thousands of Korean won)* | *(In thousands of Korean won)* | **2022** | **2021** |
|  Underlying assets | Financial assets at fair value through profit or loss | 309013708 | 169478418 |
|  | Loans measured at amortized cost<sup>1</sup> | 1883227454 | 1366231908 |
|  |  | 2192241162 | 1535710326 |
|  Associated liabilities | Debentures | 2039393029 | 1534364063 |

---

<sup>1</sup> The amounts disclosed in above table are before deduction of allowances. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**38. Financial Risk Management** 

**38.1 Summary** 

**38.1.1 Overview of Financial Risk Management Policy** 

The financial risks that the Group is exposed to are credit risk, liquidity risk, market risk, operational risk and others.

The note regarding financial risk management provides information about the risks that the Group is exposed to, including the objectives, policies and processes for assessing and managing the risks and net operating capital ratio management. Additional quantitative information is disclosed throughout these notes to financial statements.

The Group's risk management system focuses on increasing transparency, developing the risk management environment, preventing transmission of risk to other related subsidiaries, and the preemptive response to risk due to rapid changes in the financial environment to support the Group's long-term strategy and business decisions efficiently. Credit risk, liquidity risk, market risk, operational risk, and credit concentration risk are recognized as the Group's key risks. These risks are measured and managed by quantifying regulatory capital and VaR (Value at Risk) using a statistical method.

**38.1.2 Risk Management Organization** 

(a) Board of Directors

Board of Directors are the ultimate decision-making authority that appoint and dismiss risk management committee, establish and amend the risk management committee policies, establish the Group's criteria for risk limit, decide on basic policy of risk management, and approve large-scale investments.

(b) Risk management committee

The risk management committee consists of more than three directors appointed by the Board of Directors (including more than a half of external director). The risk management committee executes the operations delegated by board of directors in accordance with risk management committee policy

(c) Risk management council

Risk management council consists of members by appointing Company's executives, including the director, who is responsible for risk management, compliance, planning/management. Also the organization is delegated by risk management committee to perform deliberation/resolution for major policies and matters related to the risk.

(d) Risk management department

Risk management department carries out practical tasks, required for risk management of the Group, such as supporting the risk management committee, reporting the Group's risk level and computing net operating capital ratio.

**38.1.3 Risk Management System** 

In order to establishing risk management structure, the Group built the total risk management system, ERMS (Enterprise Risk Management System), which is designed for reasonable price valuation against risks and the management of risk limitation to raise the soundness of assets and allocate resources efficiently. Moreover, the Group performs business with risk management basis in mainly by constructing RAPM (Risk Adjusted Performance Measure) and enlarging the portion of performance evaluation.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.1.4 Risk Management Strategy and Policy** 

As an allocation of risk capital and risk limit establishment process, the risk capital is allocated through resolution of risk management committee meetings, and the amount of risk capital is anticipated for each risk sector, business sector and department by reflecting annual management strategy and business plans.

**38.2 Credit Risk** 

**38.2.1 Overview of Credit Risk** 

The Group is exposed to certain level of credit risk and the credit risk is the risk of possible loss to portfolio due to counterparty's credit event and breach of covenant. Credit risk exposure occurs in investment activities such as loans, debt instruments, derivative transactions, and non-trading accounts, or can exist in relating to off-balance accounts.

**38.2.2 Credit Risk Management** 

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. If the trading department of the Group wants to deal with the counterparty that may cause the credit risk, the trading department submit product management plan and application in advance to get approval by the risk management council and the risk management committee. The deal is executed when the approval by the risk management council and the risk management committee is completed. Credit risk limit depends on 1) standard credit risk limit, 2) concentration limit on the same person and 3) credit rating and additional limit may be added by the trading department. In addition, credit VaR is measured in addition to the credit management listed above and credit VaR due to the internal model is operated by the credit manager measurement system of the risk metrics group. Limit management is performed on a daily basis and stress test is performed on a regular basis and in case of excess of the limit, trading department expedite the process with the procedure set by the risk management department.

**38.2.3 Maximum Exposure to Credit Risk** 

The maximum exposure of credit risk related to the off-balance as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Agreement to purchase the commercial papers <sup>1</sup> | 894200000 | 576882291 |
|  Guarantees and loan commitment | 1511552415 | 1292884469 |
|  | 2405752415 | 1869766760 |

---

<sup>1</sup> As at December 31, 2022 and 2021, asset-backed short-term bonds amounting to W 556,400 million and W 101,660 million, respectively, held by the Group, are included. 

The Group does not disclose financial assets (except above contracts) whose carrying amount represents the maximum exposure to credit risk.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.2.4 Credit Risk Concentration Analysis** 

(a) Loans measured at amortised cost

Most of counterparties of loan transactions, before considering collaterals and other credit reinforcements, are concentrated in Korea. The ratios of loans to individuals and corporations and related allowances as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Loans measured<br>at amortised cost** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  Individuals | 3013311847 | 33.57 | (5309305) | 3008002542 |
|  Corporations | 5963136067 | 66.43 | (63634997) | 5899501070 |
|  | 8976447914 | 100.00 | (68944302) | 8907503612 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Loans measured<br>at amortised cost** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  Individuals | 3156085093 | 43.42 | (29651) | 3156055442 |
|  Corporations | 4112430576 | 56.58 | (82277836) | 4030152740 |
|  | 7268515669 | 100.00 | (82307487) | 7186208182 |

---

The details of the Group's loans measured at amortised cost by industry as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Loans measured at<br>amortised cost** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  Financial service | 3286456276 | 36.61 | (27120284) | 3259335992 |
|  Manufacturing | 467421330 | 5.21 | (3551434) | 463869896 |
|  Service | 1314159811 | 14.64 | (27974937) | 1286184874 |
|  Others | 895098650 | 9.97 | (4988342) | 890110308 |
|  Individuals | 3013311847 | 33.57 | (5309305) | 3008002542 |
|  | 8976447914 | 100.00 | (68944302) | 8907503612 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Loans measured at<br>amortised cost** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  Financial service | 1571228558 | 21.62 | (16021282) | 1555207276 |
|  Manufacturing | 462775654 | 6.37 | (7778553) | 454997101 |
|  Service | 1404940209 | 19.33 | (33292623) | 1371647587 |
|  Others | 673486155 | 9.27 | (25185379) | 648300776 |
|  Individuals | 3156085093 | 43.41 | (29650) | 3156055443 |
|  | 7268515669 | 100.00 | (82307487) | 7186208182 |

---

(b) Deposits, Securities (except equity instruments) and Derivatives

Most of deposits, securities (except equity instruments) and derivatives, before considering collaterals and other credit reinforcements, are concentrated in securities issued in Korea. The details of the Group's securities (except equity instruments) by industry as at December 31, 2022 and 2021, are as follows:

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Amount** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  **Deposits measured at amortised cost** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 4538086485 | 100.00 | (645224) | 4537441261 |
|  | 4538086485 | 100.00 | (645224) | 4537441261 |
|  **Securities at FVTPL** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 10302987449 | 36.51 |  | 10302987449 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 9839206275 | 34.87 |  | 9839206275 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 8076449164 | 28.62 |  | 8076449164 |
|  | 28218642888 | 100.00 |  | 28218642888 |
|  **Derivatives financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 1596038 | 0.09 |  | 1596038 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 1690445757 | 98.04 |  | 1690445757 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 32268463 | 1.87 |  | 32268463 |
|  | 1724310258 | 100.00 |  | 1724310258 |
|  **Securities at FVOCI** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 449958939 | 10.94 |  | 449958939 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 2493923434 | 60.64 |  | 2493923434 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 1168846251 | 28.42 |  | 1168846251 |
|  | 4112728624 | 100.00 |  | 4112728624 |
|  | 38593768255 |  | (645224) | 38953123031 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Amount** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  **Deposits measured at amortised cost** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 3834681126 | 100.00 | (632624) | 3834048502 |
|  | 3834681126 | 100.00 | (632624) | 3834048502 |
|  **Securities at FVTPL** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 12403754293 | 37.69 |  | 12403754293 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 12204363089 | 37.09 |  | 12204363089 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 8300357806 | 25.22 |  | 8300357806 |
|  | 32908475188 | 100.00 |  | 32908475188 |
|  **Derivatives financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 805813795 | 98.57 |  | 805813795 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 11704512 | 1.43 |  | 11704512 |
|  | 817518307 | 100.00 |  | 817518307 |
|  **Securities at FVOCI** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 411524232 | 12.13 |  | 411524232 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 2019245794 | 59.52 |  | 2019245794 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 961875467 | 28.35 |  | 961875467 |
|  | 3392645493 | 100.00 |  | 3392645493 |
|  | 40953320114 |  | (632624) | 40952687490 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.2.5 Credit Quality of Financial Assets** 

(a) Loans measured at amortised cost

Loans measured at amortised cost as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** |  |  |  |
|  Corporates |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 2201520418 |  |  |  |  | 2201520418 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 3627589800 |  |  |  |  | 3627589800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 48465895 | 30000000 |  |  |  | 78465895 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 37203171 |  |  |  |  | 37203171 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  | 18356784 |  |  | 18356784 |
|  | 5914779284 | 30000000 | 18356784 |  |  | 5963136068 |
|  Retails |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 2917664910 |  |  |  |  | 2917664910 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 90276978 |  |  |  |  | 90276978 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 60654 |  |  |  |  | 60654 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  | 5309306 |  |  | 5309306 |
|  | 3008002542 |  | 5309306 |  |  | 3013311848 |
|  **Loans measured at FVTPL** |  |  |  |  |  |  |
|  Corporates |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 |  |  |  |  | 44489203 | 44489203 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |  |
|  |  |  |  |  | 44489203 | 44489203 |
|  | 8922781826 | 30000000 | 23666090 |  | 44489203 | 9020937119 |

---

<sup>1</sup> The amounts disclosed in above table are before deduction of allowances 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** |  |  |  |
|  Corporates |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 1642413537 |  |  |  |  | 1642413537 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 2315042944 | 37000000 |  |  |  | 2352042944 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 9775000 | 20000000 |  |  |  | 29775000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 36959224 | 2000000 |  |  |  | 38959224 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  | 49239870 |  |  | 49239870 |
|  | 4004190705 | 59000000 | 49239870 |  |  | 4112430575 |
|  Retails |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 3154795577 |  |  |  |  | 3154795577 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 1256577 |  |  |  |  | 1256577 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 3289 |  |  |  |  | 3289 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  | 29651 |  |  | 29651 |
|  | 3156055443 |  | 29651 |  |  | 3156085094 |
|  **Loans measured at FVTPL** |  |  |  |  |  |  |
|  Corporates |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 |  |  |  |  | 175366396 | 175366396 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |  |
|  |  |  |  |  | 175366396 | 175366396 |
|  | 7160246148 | 59000000 | 49269521 |  | 175366396 | 7443882065 |

---

<sup>1</sup> The amounts disclosed in above table are before deduction of allowances 

---

| | | |
|:---|:---|:---|
| **Ranges** | **Corporates** | **Retails** |
|  Grade 1 | AAA ~ BBB+ | 1 ~ 5 grade |
|  Grade 2 | BBB ~ BB | 6 ~ 8 grade |
|  Grade 3 | BB- ~ B | 9 ~ 10 grade |
|  Grade 4 | B- ~ CCC | 11 grade |
|  Grade 5 | Below CC | Below 12 grade |

---

The effect of measured credit risk which released the credit risk due to enhancement of collateral and other credit supplements secured for loans as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  Guarantee | 7643969 |  |  |  |  | 7643969 |
|  Real estate | 290470326 |  | 208363 |  |  | 290678689 |
|  Securities | 6366812101 |  |  |  |  | 6366812101 |
|  | 6664926396 |  | 208363 |  |  | 6665134759 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  Guarantee | 6774307 |  |  |  |  | 6774307 |
|  Real estate | 452414459 |  | 208363 |  |  | 452622823 |
|  Securities | 5091901577 |  |  |  |  | 5091901577 |
|  | 5551090343 |  | 208363 |  |  | 5551298706 |

---

(b) Securities (debt instruments)

Securities (debt instruments) that are exposed to credit risks as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The<br>financial<br>instruments<br>not<br>applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The<br>financial<br>instruments<br>not<br>applying<br>expected<br>credit loss<br>model** | **Total** |
|  Financial assets at FVOCI <sup>1</sup> |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 3262409959 |  |  |  |  | 3262409959 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 836531848 |  |  |  |  | 836531848 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 13786817 |  |  |  |  | 13786817 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |  |
|  | 4112728624 |  |  |  |  | 4112728624 |

---

<sup>1</sup> Before deduction of allowances

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The<br>financial<br>instruments<br>not<br>applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The<br>financial<br>instruments<br>not<br>applying<br>expected<br>credit loss<br>model** | **Total** |
|  Financial assets at FVOCI <sup>1</sup> |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 2423690840 |  |  |  |  | 2423690840 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 955435698 |  |  |  |  | 955435698 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 13518956 |  |  |  |  | 13518956 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |  |
|  | 3392645494 |  |  |  |  | 3392645494 |

---

<sup>1</sup> Before deduction of allowances

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The Group's standard for credit quality of securities(except equity investments) linked to credit rating presented by 3<sup>rd</sup> party credit rating institutions is as follows.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Domestic** | **Domestic** | **Domestic** | **Foreign** | **Foreign** | **Foreign** |
| Credit<br> Quality | KIS | NICE | FnPricing | S&P | Fitch-IBCA | Moody's |
| Grade 1 | AA0 to AAA | AA0 to AAA | AA0 to AAA | A- to AAA | A- to AAA | A3 to Aaa |
| Grade 2 | A- To AA- | A- To AA- | A- To AA- | BBB- to BBB+ | BBB- to BBB+ | Baa3 to Baa1 |
| Grade 3 | BBB0 to BBB+ | BBB0 to BBB+ | BBB0 to BBB+ | BB to BB+ | BB to BB+ | Ba2 to Ba1 |
| Grade 4 | BB0 to BBB- | BB0 to BBB- | BB0 to BBB- | B+ to BB- | B+ to BB- | B1 to Ba3 |
| Grade 5 | Below BB- | Below BB- | Below BB- | Below B | Below B | Below B2 |

---

The classification of credit quality for debt instruments in Korean won is based on lowest credit rating among the one of three domestic credit rating institutions and the classification of credit quality for debt instruments in foreign currency is based on lowest credit rating among the one of three foreign credit rating institutions

(c) Deposits

The credit quality of deposits as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  Deposits measured at amortised cost <sup>1</sup> |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 4538221418 |  |  |  | 4538221418 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | 4538221418 |  |  |  | 4538221418 |

---

<sup>1</sup> Before deduction of allowances

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  Deposits measured at amortised cost <sup>1</sup> |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 3834681299 |  |  |  | 3834681299 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | 3834681299 |  |  |  | 3834681299 |

---

<sup>1</sup> Before deduction of allowances

The Group's standard for credit quality of deposits is same as the one of debt securities.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

(d) Commitments

The credit quality of commitments as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  Guaranteed payment and commitment |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 431461335 |  |  |  | 431461335 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 937138592 | 31731909 |  |  | 968870501 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 32238671 |  |  |  | 32238671 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 416781907 |  |  |  | 416781907 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | 1817620505 | 31731909 |  |  | 1849352414 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  Guaranteed payment and commitment |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 612916750 | 17282291 |  |  | 630199041 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 820660660 |  |  |  | 820660660 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 24706778 |  |  |  | 24706778 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 394200281 |  |  |  | 394200281 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | 1852484470 | 17282291 |  |  | 1869766760 |

---

(e) Other receivables from securities transactions

Other receivables from securities transactions, which are classified as other financial assets, as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Other receivables related to proprietary trading |  | 182035890 |  | 104074769 |
|  Other receivables related to brokerage Transactions |  | 2002456540 |  | 2635657555 |

---

The Group recognizes receivables and payables between Korea Exchange (Clearing and Settlement Organization) and customers regarding securities brokerage transactions on the trade date. The Group is exposed to credit risks between the trade date and settlement date relating to investment brokerage business, which is standardized by related regulations (generally less than two business days from the trade date). As a central counterparty, Korea Exchange mitigates the payment default risk by managing collective fund for default loss, and the Group mitigates customer default risk through margin requirements system. Also, if the customers can not pay by the settlement date, the Group can collect the receivables through covering. Therefore, credit risk that the Group actually bears is linked to the price fluctuation risk of securities between the trade date and the settlement date.

The Group recognizes assets and liabilities on trade date for regular-way transactions and is exposed to the market risk and credit risk between trade date and settlement date.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.3 Liquidity Risk** 

**38.3.1 Overview of Liquidity Risk** 

Liquidity risk is the risk of insolvency or loss due to a disparity between the inflow and outflow of funds, unexpected outflow of funds, and obtaining funds at a high price or disposing of securities at an unfavorable price due to lack of available funds. The Group manages its liquidity risk through analysis of the contractual maturity of all financial assets, liabilities and off-statement of financial position items such as commitments and financial guarantee contracts. The Group discloses them by maturity groups: Up to one month, between over one month and three months, between over three months and twelve months, between over one year and five years, and over five years.

**38.3.2 Liquidity Risk Management Policy** 

The Group has established an appropriate liquidity risk management framework for the management of the Group's short-, medium- and long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and by matching the maturity profiles of financial assets and liabilities. Meanwhile, additional details of unused funding arrangement to reduce liquidity risk that the Group holds at its discretion are discussed in Note 41.

**38.3.3 Analysis on Remaining Contractual Maturities of Financial Liabilities** 

Cash flows disclosed for the maturity analysis are undiscounted contractual principal and interest to be received (paid) and, thus, differ from the amount in the financial statements which are based on the present value of expected cash flows in some cases.

The remaining contractual maturities of financial liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **On demand** | **Up to one month** | **One to three<br>months** | **Three to 12<br>months** | **12 months to<br>five years** | **More than<br>five years** | **Total** |
|  **Financial liabilities** |  |  |  |  |  |  |  |
|  Financial liabilities at FVTPL | 2082979265 |  |  |  |  |  | 2082979265 |
|  Financial liabilities designated at FVTPL <sup>1</sup> | 10088600213 |  |  |  |  |  | 10088600213 |
|  Derivatives (trading) <sup>2</sup> | 2310859900 |  |  |  |  |  | 2310859900 |
|  Derivatives (hedge) |  | 10070190 | 422620 |  | 1123380 |  | 11616190 |
|  Deposit liabilities <sup>3</sup> | 6799233076 |  |  |  |  |  | 6799233076 |
|  Borrowings | 7771843528 | 6482377184 | 3141089345 | 4570503698 | 1780651651 | 19855119 | 23766320525 |
|  Other financial liabilities | 16349365 | 2183847861 | 8689578 | 29369004 | 93934508 | 10625818 | 2342816134 |
|  Guaranteed payments and commitment <sup>4</sup> | 1849352415 |  |  |  |  |  | 1849352415 |

---

<sup>1</sup> Derivatives-linked securities as financial liabilities designated at FVTPL are classified as 'on demand' because derivatives-linked securities are subject to early settlement.

<sup>2</sup> Derivatives are classified as 'on demand' because contract maturity is not necessary in understanding the cash flow timing of the derivatives

<sup>3</sup> Deposits that are contractually repayable on demand or on short notice are classified as 'on demand' category.

<sup>4</sup> With respect to the guaranteed payments and commitments, the amounts included above, which the Group might pay the maximum amounts based on the contract, if the warrantee claims the entire amount of the guarantee, they are classified on the basis of the earliest period when those agreements may be executed. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **On demand** | **Up to one month** | **One to three<br>months** | **Three to 12<br>months** | **12 months to<br>five years** | **More than<br>five years** | **Total** |
|  **Financial liabilities** |  |  |  |  |  |  |  |
|  Financial liabilities at FVTPL | 2825922918 |  |  |  |  |  | 2825922918 |
|  Financial liabilities designated at FVTPL <sup>1</sup> | 9160923652 |  |  |  |  |  | 9160923652 |
|  Derivatives (trading) <sup>2</sup> | 857388295 |  |  |  |  |  | 857388295 |
|  Derivatives (hedge) |  | 9122400 |  | 7215920 | 915127 |  | 17253447 |
|  Deposit liabilities <sup>3</sup> | 8391075183 |  |  |  |  |  | 8391075183 |
|  Borrowings | 8448833366 | 9370162500 | 1289202707 | 3045919342 | 2715034226 | 2105718 | 24871257860 |
|  Other financial liabilities | 3376026 | 3324090215 | 4941525 | 22583280 | 87055423 | 26482744 | 3468529213 |
|  Guaranteed payments and commitment <sup>4</sup> | 1869766760 |  |  |  |  |  | 1869766760 |

---

<sup>1</sup> Derivatives-linked securities as financial liabilities designated at FVTPL are classified as 'on demand' because derivatives-linked securities are subject to early settlement.

<sup>2</sup> Derivatives are classified as 'on demand' because contract maturity is not necessary in understanding the cash flow timing of the derivatives

<sup>3</sup> Deposits that are contractually repayable on demand or on short notice are classified as 'on demand' category.

<sup>4</sup> With respect to the guaranteed payments and commitments, the amounts included above, which the Group might pay the maximum amounts based on the contract, if the warrantee claims the entire amount of the guarantee, they are classified on the basis of the earliest period when those agreements may be executed. 

**38.4 Market Risk** 

**38.4.1 Overview of Market Risk** 

Market risk refers to the risk that the value of a position held by the Group may fluctuate due to price fluctuations of market factors such as stock, interest rates, foreign exchange rates, commodity and others.

Market risk is daily managed by establishing the limitations considering products' natures such as position limitations, loss limitations, VaR limitations, sensitivity limitations (duration, delta, gamma, vega, others) and others. Relevant business procedures are processed by written regulations and guidelines.

**38.4.2 Value at Risk ("VaR")** 

The Exposure to market risk is measured by the Value at Risk (VaR). VaR is the potential loss that can occur in the holding position when the market price moves in an adverse direction within a given confidence level for a given holding period in the normal market.

Historical simulation model is used to calculate 10days VaR. Historical simulation model is based on past changes of market variables without assuming a specific probability distribution.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The Group uses the 10-day return of the past two-year time series of the asset risk factor and uses the 99% confidence level of the two-year time series of the portfolio. 10days VaR that is under 99% of confidence level that the Group uses reflects reported daily losses as VaR does not exceed with 99% chance.

The average, minimum and maximum amount of the Group's VaR (99%, 10 days) as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Average** | **Maximum** | **Minimum** | **December 31,<br>2022** |
|  Total VaR | 35197541 | 60205109 | 18655089 | 20195624 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Average** | **Maximum** | **Minimum** | **December 31,<br>2021** |
|  Total VaR | 27533895 | 44103782 | 13303234 | 32812682 |

---

**38.4.3 Risk Management by Market Risk Factors** 

The Group's market risk is comprised of interest rate risk, foreign exchange rate risk and stock price risk.

(a) Stock price risk

Stock price risk arises in the Group's foreign currency stocks and Korean won stocks.

Hedging instruments of Equity Linked Security and Equity Linked Warrant comprise most of stock trading portfolio and certain security proprietary trading is composed of trading securities on the exchange, futures contracts maturing in a month or two, and others under the restriction of position limitation, sale at loss, loss limitation, and others. Marketable stocks among non-trading positions and stock beneficiary certificates are included in stock price risk and market VaR is computed.

Risk management council allocates position and loss limitations, and risk management department monitors asset management department's possible breach of limitations and other special matters on a daily basis.

(b) Interest rate risk

Trading position interest rate risk usually arises from debt instruments denominated in Korean won. The Group's trading strategy is to benefit from short-term movements in the prices of debt instruments arising from changes in interest rates.

The product prices of the Group's trading accounts are disclosed daily. The risks related to trading accounts are managed by using market value based method such as market VaR and sensitivity analysis.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

(c) Foreign exchange rate risk

Foreign exchange rate risk arises through ownership of assets and liabilities, denominated in currencies other than Korean won, from non-trading positions, or through foreign currency forward agreements, currency swaps and foreign currency trading securities.

The Group computes foreign currency position's net position regularly to follow the Regulation on Financial Investment Business and reports to the supervisory body.

Also, the Group manages the risk for total position exposed to foreign exchange rate including non-trading position by using market price base method such as market VaR and sensitivity analysis.

**38.4.4 Risk Management by Interest Rate Risk Factors** 

The Group closely monitors markets and the outputs of the various industry working groups that manage the transition to the new interest rate indicator, including statements made by the IBOR regulator and various consultative councils related to the transition to alternative interest rates.

In response to these announcements, the Group established an IBOR-related response plan consisting of workflows such as risk management, accounting, tax, law, computerization, and customer management, and completed most of the conversions and replacements accordingly. The Chief Financial Officer (CFO) is responsible for the planning and progress management, and important matters are reported to the Board of Directors.

The purpose of the plan is to identify the impacts and risks associated with interest rate indicator reform within the business, and to prepare and implement an action plan to facilitate the transition to an alternative indicator interest rate. The Group aims to complete the response plan by the end of June, 2023.

The carrying amount of financial instruments that have not been converted to an alternative indicator interest rate as of December 31, 2022 and 2021 are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  | **Exposure amount <sup>1</sup><br>USD LIBOR** | **Exposure amount <sup>1</sup><br>USD LIBOR** |
|  **Measured at amortised cost** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans | 7482357 | 7035224 |
|  **Measured at fair value** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL(non-derivative) |  | 4694580 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL(derivative) |  | 103221786 |

---

<sup>1</sup> Financial instruments that will expire before conversion to an alternative indicator interest rate are excluded.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.5 Operational Risk** 

**38.5.1 Concept** 

The Group defines operational risk to the extent of financial risk and non-financial risks incurred by unreasonable or wrong internal process, labor, system and external incidents.

**38.5.2 Operational Risk Management** 

The purpose of operational risk management is control activity through continuous improvement of internal controls, performing proactive preventive control, proliferation of culture of risk management by establishing internal control that could respond quickly against change of business environment. OMRS (Operational Risk Management System), supports performing overall risk management such as recognition of operational risk, evaluation and monitoring. Periodically, through RCSA (Risk Control Self Assessment), management of KRI (Key Risk Indicator), management of data loss and related preparation of countermeasures, it controls the risks in advance, as well as collecting data for future advanced management method.

**38.6 Capital Management** 

Main purpose of the capital risk management of the Group is optimizing use of capital and sustaining healthy financial status in order to maximize shareholder value. The Group has performed capital risk management through estimating net capital ratio based on 'Capital Market and Financial Investment Business Act', enforced in February 2009.

Net capital ratio is the net capital minus the total risk amount divided by the essential equity to sustain per each business unit. [(Net capital – total risk amounts) / essential equity to sustain per each business unit]. This formula is calculated based on the financial statements amount.

The net capital is calculated by subtracting deductible items and including additional item from financial investor's net asset (asset-liability) as at date. The deductible item refers any asset that is difficult to be converted into cash immediately such as property, plant and equipment. The adding item includes that any item that recorded as liability without redemption obligation, internal reserves against future losses, items that redeemable in kind and items that function of complemental capital.

Total amount of risk is quantification of all of possible losses from operation of business for financial investor. Quantified amounts of market risks by possible losses due to fluctuation of stock price; interest and exchange rates of the securities that the investment firms held; credit risk amounts from breach of contract by the counterparties and possible losses due to accidents, errors, illegal conduct, any other potential losses from deteriorated condition for operation.

According to the Financial Investment Act, the regulation requires that net capital ratio must be maintained above 100% for the appropriation of the capital and it is required to improve the management if the financial investment firm does not meet the regulation for the net capital ratio.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**39. Offsetting Financial Assets and Financial Liabilities** 

The Group enters into International Derivatives Swaps and Dealers Association ("ISDA") master netting agreements or similar agreement with the Group's derivative counterparties. The Group also enters into repurchase agreements and securities borrowing and lending agreements similar to the master netting agreement for derivatives. Master netting agreements provide protection in bankruptcy in certain circumstances and, where legally enforceable, enable receivables and payables with the same counterparty to be offset for accounting and risk management purposes.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gross amount** | **Offset**<br> **amount** | **Net amounts<br>presented in the<br>statement of<br>financial position** | **Amounts not offset** | **Amounts not offset** | **Net amount** |
| *(in thousands of Korean won)* | **Gross amount** | **Offset**<br> **amount** | **Net amounts<br>presented in the<br>statement of<br>financial position** | **Recognized<br>financial<br>instruments** | **Cash<br>collateral** | **Net amount** |
|  **Financial assets** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives assets, others <sup>1</sup> | 1800627070 |  | 1800627070 | 1240440412 | 194397457 | 365789201 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities purchased under reverse repurchase agreements | 730100000 |  | 730100000 | 730100000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables <sup>4</sup> | 1985950659 | 1897820808 | 88129851 |  |  | 88129851 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables (Payment and settlement) | 26385142 | 26385142 |  |  |  |  |
|  | 4543062871 | 1924205950 | 2618856921 | 1970540412 | 194397457 | 453919052 |
|  **Financial liabilities** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives liabilities, others <sup>1</sup> | 3357495348 |  | 3357495348 | 2658744222 | 83836686 | 614914440 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities sold under reverse resale agreements <sup>2</sup> | 6231390409 |  | 6231390409 | 6231390409 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities sold <sup>3</sup> | 2082979265 |  | 2082979265 | 2082979265 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other payables <sup>4</sup> | 1954742873 | 1897820808 | 56922065 |  |  | 56922065 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other payables (Payment and settlement) | 27716059 | 26385142 | 1330917 |  |  | 1330917 |
|  | 13654323954 | 1924205950 | 11730118004 | 10973113896 | 83836686 | 673167422 |

---

<sup>1</sup> Both of derivatives (trading) and derivatives (hedge) are included.

<sup>2</sup> Securities sold under reverse resale agreements to the customers is included.

<sup>3</sup> Securities sold is from securities borrowing and lending agreement.

<sup>4</sup> The offsetting amounts of bonds and debts arising from transactions occurring on the same day between the Korea Exchange and the Group in relation to the client's consignment trading is included. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gross amount** | **Offset**<br> **amount** | **Net amounts<br>presented in the<br>statement of<br>financial position** | **Amounts not offset** | **Amounts not offset** | **Net amount** |
| *(in thousands of Korean won)* | **Gross amount** | **Offset**<br> **amount** | **Net amounts<br>presented in the<br>statement of<br>financial position** | **Recognized<br>financial<br>instruments** | **Cash<br>collateral** | **Net amount** |
|  **Financial assets** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives assets, others <sup>1</sup> | 846411930 |  | 846411930 | 544286051 | 235743401 | 66382478 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities purchased under reverse repurchase agreements | 442100000 |  | 442100000 | 442100000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables <sup>4</sup> | 2317397927 | 2307527540 | 9870387 |  |  | 9870387 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables (Payment and settlement) | 105464571 | 99790621 | 5673950 |  |  | 5673950 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Receivable unsettled spot exchange | 237030000 |  | 237030000 | 237030000 |  |  |
|  | 3948404428 | 2407318161 | 1541086267 | 1223416051 | 235743401 | 81926815 |
|  **Financial liabilities** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives liabilities, others <sup>1</sup> | 1483107954 |  | 1483107954 | 1050325766 | 75252991 | 357529197 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities sold under reverse resale agreements <sup>2</sup> | 13531208950 |  | 13531208950 | 13531208950 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities sold <sup>3</sup> | 2825922918 |  | 2825922918 | 2825922918 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other payables <sup>4</sup> | 2712412451 | 2307527540 | 404884911 |  |  | 404884911 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other payables<br> (Payment and settlement) | 99790621 | 99790621 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Payable unsettled spot exchange | 237100000 |  | 237100000 | 237100000 |  |  |
|  | 20889542894 | 2407318161 | 18482224733 | 17644557634 | 75252991 | 762414108 |

---

<sup>1</sup> Both of derivatives (trading) and derivatives (hedge) are included.

<sup>2</sup> Securities sold under reverse resale agreements to the customers is included.

<sup>3</sup> Securities sold is from securities borrowing and lending agreement.

<sup>4</sup> The offsetting amounts of bonds and debts arising from transactions occurring on the same day between the Korea Exchange and the Group in relation to the client's consignment trading is included. 

**40. Lease** 

40.1 The amounts recognized in the consolidated statement of financial position

The amounts related to lease recognized in the consolidated statement of financial position as at December 31, 2022 and 2021, are as follows;

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Right-of-use assets <sup>1</sup> |  |  |
|  Buildings | 76580927 | 73419498 |
|  Vehicles | 2258588 | 1570194 |
|  Others | 1005513 | 1710375 |
|  | 79845028 | 76700067 |
|  Lease liabilities | 125593239 | 127992813 |

---

<sup>1</sup> The amount is included in property and equipment in the consolidated statement of financial position. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

40.2 The amounts recognized in the consolidated statement of profit or loss

The amounts related to lease recognized in the consolidated statement of profit or loss for the year ended December 31, 2022 and 2021, are as follows

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Depreciation of the right-of-use assets |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings | 24022595 | 16115606 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vehicles | 1188483 | 1176069 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 1081530 | 1281970 |
|  | 26292608 | 18573645 |
|  Interest income from lease receivables (included in financial income) | 1084287 | 1615695 |
|  Interest expense to lease liabilities (included in financial cost) | 3573738 | 2953182 |
|  Lease payment for leases for which the underlying asset is of low value (included in administrative expenses, not-include lease for short-term period) | 1141427 | 986405 |
|  Variable lease payments which are not included in the measurement of lease liabilities (included in administrative expenses) | 126576 | 256363 |

---

The total cash outflows for leases in 2022 and 2021 are W 33,554 million and W 34,917 million, respectively.

40.3 As a Lessor : Financial Lease

As at December 31, 2022 and 2021, total investment on financial lease and present value of minimum lease payments and unrealized interest income of financial lease are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Total Investment on lease | 35135664 | 41127430 |
|  Net Investment on lease | 32271624 | 37179103 |
|  Present value of minimum lease payments | 32271624 | 37179103 |
|  Unrealized interest income | 2864040 | 3948327 |

---

40.4 As a Lessor : Operating Lease

As at December 31, 2022 and 2021, future minimum lease receipts expected under non-cancellable lease contracts are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Within 1 year |  | 32399049 |  | 50784062 |
|  1 - 5 years |  | 127788610 |  | 231084324 |
|  Over 5 years |  | 170691730 |  | 272652305 |
|  |  | 330879389 |  | 554520691 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**41. Contingent Liabilities and Commitments** 

As at December 31, 2022 and 2021, the Group is involved in pending lawsuits, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Number of**<br> **lawsuits** | **Number of**<br> **lawsuits** | **Amount** | **Amount** | **Number of**<br> **lawsuits** | **Number of**<br> **lawsuits** | **Amount** | **Amount** |
|  Defendant |  | 33 |  | 202977447 |  | 21 |  | 176352560 |
|  Plaintiff |  | 8 |  | 177971745 |  | 9 |  | 163067109 |

---

The Group expects that these lawsuits do not have significant impact on the financial position.

The Group has entered into various agreements with financial institutions as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  |  | **Credit line** | **Credit line** |
| *(in thousands of Korean won)* | **Financial institution** | **2022** | **2021** |
|  Overdraft (including daily overdraft) | Kookmin Bank and others | 530000000 | 530000000 |
|  General loan | Kookmin Bank | 40000000 | 40000000 |
|  Securities underwriting loan | KSFC | 600000000 | 700000000 |
|  Working capital loan (general) | KSFC | 475000000 | 375000000 |
|  Note trading at a discount (general) | KSFC | 300000000 | 300000000 |
|  Note trading at a discount (trust) | KSFC | Limit of subscription<br>deposits | Limit of subscription<br>deposits |
|  Bond dealer's loan (general) | KSFC | 500000000 | 850000000 |
|  Securities underwriting financing | KSFC | 1710000000 | 1500000000 |

---

The guarantees and various commitment as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Agreement to purchase commercial papers <sup>1</sup> | 337800000 | 576882291 |
|  Loan agreements | 6650000 | 30000000 |
|  Credit line agreements | 1028048939 | 817405672 |
|  LOC and Investment commitments | 476853476 | 445478798 |
|  | 1849352415 | 1869766761 |

---

<sup>1</sup> According to the above arrangement, the Group holds the asset-backed short-term bonds amounting to W556,400 million and W101,660 million as at December 31, 2022 and 2021, respectively. 

The Group has been provided with W10,731 million and W12,678 million in guarantees related to provisional attachment and others by Seoul Guarantee Insurance as at December 31, 2022 and 2021, respectively.

The securities in custody as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** | **Valuation method** |
|  Trustor securities | 200379840702 | 155890031762 | Fair value |
|  Saver securities | 308762230 | 232748017 | Fair value |
|  Beneficiary securities | 35441473205 | 32356219560 | Standard selling price |
|  | 236130076137 | 188478999339 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

The Group, as a selling company of qualitied investor private equity fund that aims to lend money to corporations (borrowers) investing in apartment rental business for disabled people in Australia, intermediated W 326.5 billion of trusts and funds to the individuals and institutional investors. However, the local borrower's breach of the contract makes the fund inoperable and there is a possibility of loss of principal.

As at December 31, 2022, three lawsuits were filed to the Group as a defendant. On February 7, 2023, in one case, the first-instance verdict of the trial ordering the payment of a total of W 29.8 billion and delayed interest thereon was announced, but there is a possibility that the conclusion is changed in the upper court, and the other two cases are still in the first instance. The Group has reflected in its financial statements the results of the first-instance verdict handed down on February 7, 2023, as an adjusting event after the reporting period, and has incorporated the related litigation provision liabilities into its consolidated financial statements as at December 31, 2022.

Meanwhile, the Group has filed a lawsuit against JB Asset Management Co., Ltd, the fund management company, for compensation, and the first trial is currently in progress.

**42. Related Party Transactions** 

KB Financial Group Inc. owns 100% of ordinary shares of the KB Securities Co., Ltd. as at December 31, 2022 and 2021.

Significant balances, excluding loan and borrowing transactions, with related parties as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  | **Receivables** | **Payables** | **Receivables** | **Payables** |
|  **The Parent Company** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Financial Group Inc. | 116502545 | 66137149 | 84740 | 106320356 |
|  **Others** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Kookmin Bank | 76123515 | 154551304 | 65935574 | 56100555 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Asset Management Co., Ltd. | 1479 | 32643821 | 1747 | 32815772 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Real Estate Trust Co., Ltd. |  | 622 |  | 522 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Investment Co., Ltd. | 627295 | 236 | 154405 | 121 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Credit Information Co., Ltd. |  | 147 |  | 2719 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Data System Co., Ltd. | 856887 | 43007 | 179879 | 235328 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Life Insurance Co., Ltd. | 685561 | 381241 | 790282 | 380519 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Kookmin Card Co., Ltd. | 50551 | 7572851 | 142366 | 7390861 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Savings Bank Co., Ltd. |  | 552 |  | 399 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Capital Co., Ltd. | 96317 | 2380696 | 92710 | 1489116 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Insurance Co., Ltd | 52388172 | 20353598 | 7512920 | 2967593 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Life Insurance Co., Ltd. (former Prudential Life Insurance Co., Ltd.)<sup>1</sup> | 329563 | 651994 | 378566 | 717402 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Wisestar Private Real Estate Fund Investment Trust No. 1 | 7292 |  | 7811 | 59551609 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other funds | 206781 | 19141815 | 2566825 | 4718031 |

---

<sup>1</sup> Changed company name from Prudential Life Insurance Co., Ltd. to KB Life Insurance Co., Ltd. for the year ended December 31, 2022.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Significant transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Revenue** | **Expenses** | **Revenue** | **Expenses** |
|  **Associates** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-Stonebridge Secondary Private Equity Fund | 705744 |  | 549714 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-SJ Tourism Venture Fund | 209347 |  | 278571 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-SP Private Equity Fund IV | 210945 |  | 388931 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.17 <sup>1</sup> |  |  |  | 1067588 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.18 <sup>1</sup> |  |  | 5886 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.19 <sup>1</sup> |  |  | 36244 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.20 <sup>1</sup> |  |  | 67917 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Bio Private Equity Fund III Ltd. <sup>1</sup> | 4034553 |  | 323836 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; K The fifteenth Real Estate Investment Trust <sup>1</sup> |  |  | 500000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Keystone-Hyundai Sec. No.1 Private Equity Fund <sup>1</sup> |  |  | 42637 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-Brain KOSDAQ Scale-Up Fund | 422946 |  | 514119 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-KDBC New Technology Business Investment Fund | 129289 |  | 189998 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KBTS Technology Venture Private Equity Fund | 185355 |  | 285290 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-UTC Inno-Tech Venture Fund | 449015 |  | 471466 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 561064 |  | 1198196 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB SPROTT Renewable Private Equity Fund I | 345339 |  | 487500 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Material and Parts No. 1 PEF | 352500 |  | 352500 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-KTB Technology Venture Fund | 599726 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-GeneN Medical Venture Fund 1 | 76392 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-BridgePole Venture Investment Fund | 117986 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-Kyobo New Mobility Power Fund | 68825 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.21 | 1731563 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; THE CHAEUL FUND NO.1 <sup>2</sup> | 81844 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.22 | 1157075 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-NP Green ESG New Technology Venture Capital Fund | 435147 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.23 | 1476465 |  |  |  |
|  **The Parent Company** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Financial Group Inc. | 484732 | 20241 | 689158 | 15168 |
|  **Others** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Kookmin Bank | 187822727 | 274544619 | 114540036 | 117174822 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Asset Management Co., Ltd. | 9069 | 1679427 | 9821 | 1108009 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Real Estate Trust Co., Ltd. | 936 | 3010 | 760 | 5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Investment Co., Ltd. | 1902935 | 4 | 616501 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Credit Information Co., Ltd. | 221 | 3 | 218 | 2482 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Data System Co., Ltd. | 955 | 1120617 | 823 | 1348880 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Life Insurance Co., Ltd. | 113129 | 37855 | 322568 | 327902 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Kookmin Card Co., Ltd. | 68448 | 561990 | 111626 | 679936 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB savings bank Co., Ltd. | 831 | 14 | 227 | 4610 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Revenue** | **Expenses** | **Revenue** | **Expenses** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Capital Co., Ltd. | 305322 | 41981 | 344413 | 478 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Insurance Co., Ltd | 68091902 | 67731685 | 889407 | 5459994 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Life Insurance Co., Ltd. (former Prudential Life Insurance Co., Ltd.) <sup>3</sup> | 644336 | 1004150 | 614560 | 747319 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Wisestar Private Real Estate Fund Investment Trust No. 1 |  | 8719917 | 10297783 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other funds | 18649158 | 11988579 | 5305247 | 510087 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retirement pension | 771613 |  | 598028 |  |
|  **The Group** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Employees | 344870 |  | 321649 |  |

---

<sup>1</sup> These companies are excluded from related parties during the year ended December 31, 2022 or 2021. The transaction amounts are up to the date of the exclusion. 

<sup>2</sup> Changed company name from SKS IB NEW M&T FUND NO.1 to THE CHAEUL FUND NO.1 for the year ended December 31, 2022.

<sup>3</sup> Changed company name from Prudential Life Insurance Co., Ltd. to KB Life Insurance Co., Ltd. for the year ended December 31, 2022.

Significant loan and borrowing transactions with related parties for the years ended December 31, 2022 and 2021 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Accounts** | **Beginning<br>balance** | **Increase** | **Decrease** | **Other** | **Ending <br>balance** |
|  **Associates** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.17<sup>1</sup> | Hybrid bond with securities-like features | 999500 |  | (999500) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.18<sup>1</sup> | Hybrid bond with securities-like features | 3058774 |  | (3058774) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.19<sup>1</sup> | Hybrid bond with securities-like features | 2090861 |  | (2090861) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.20<sup>1</sup> | Hybrid bond with securities-like features | 3135222 |  |  |  | 3135222 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.21 | Hybrid bond with securities-like features |  | 1490000 |  | 1469063 | 2959063 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.22 | Hybrid bond with securities-like features |  | 990000 |  | 982075 | 1972075 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.23 | Hybrid bond with securities-like features |  | 1495000 |  | 1476465 | 2971465 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.24 | Hybrid bond with securities-like features |  | 6975000 |  |  | 6975000 |
|  **Others** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Kookmin Bank | Deposits <sup>2</sup> | 537191788 |  |  | 330346210 | 867537998 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Accounts** | **Beginning<br>balance** | **Increase** | **Decrease** | **Other** | **Ending <br>balance** |
|  | Borrowings | 124560300 | 885820653 | (868303453) |  | 142077500 |
|  **The Group** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Employees | Loans to employees | 14940376 | 2324900 | (5624383) |  | 11640893 |

---

<sup>1</sup> These companies are not related party as at December 31, 2022.

<sup>2</sup> Transactions such as settlement payments for business reasons and deposits that can be deposited and withdrawn at any time between related parties are disclosed in net amounts. 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of*<br> *Korean won)* | **Accounts** | **Beginning<br>balance** | **Increase** | **Decrease** | **Other** | **Ending <br>balance** |
|  **Associates** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.17 | Hybrid bond with securities-like features | 2067088 |  |  | (1067588) | 999500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.18 | Hybrid bond with securities-like features | 3052888 |  |  | 5886 | 3058774 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.19 | Hybrid bond with securities-like features | 2054617 |  |  | 36244 | 2090861 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.20 | Hybrid bond with securities-like features | 3067305 |  |  | 67917 | 3135222 |
|  **Others** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Kookmin Bank | Deposits <sup>1</sup> | 466390869 |  |  | 70800919 | 537191788 |
|  | Borrowings | 97651298 | 756358434 | (729449432) |  | 124560300 |
|  **The Group** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Employees | Loans to employees | 19064459 | 2490240 | (6614323) |  | 14940376 |

---

<sup>1</sup> Transactions such as settlement payments for business reasons and deposits that can be deposited and withdrawn at any time between related parties are disclosed in net amounts. 

Other transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(In thousands of Korean won)* | **2022** | **2022** |
|  | **Contribution** | **Collection and others** |
|  **Associates** |  |  |
|  KB Special Purpose Acquisition Company No.17 <sup>1</sup> |  | 500 |
|  KB Special Purpose Acquisition Company No.18 <sup>1</sup> |  | 1000 |
|  KB Special Purpose Acquisition Company No.19 <sup>1</sup> |  | 1000 |
|  KB Special Purpose Acquisition Company No.20 <sup>1</sup> |  | 1000 |
|  KB Special Purpose Acquisition Company No.21 | 10000 |  |
|  KB Special Purpose Acquisition Company No.22 | 10000 |  |
|  KB Special Purpose Acquisition Company No.23 | 5000 |  |
|  KB Special Purpose Acquisition Company No.24 | 25000 |  |
|  KB New Paradigm Agriculture Venture Fund |  | 625000 |
|  KB-KDBC New Technology Business Investment Fund |  | 2600000 |
|  KBTS Technology Venture Private Equity Fund |  | 1296000 |
|  KB-SJ Tourism Venture Fund |  | 400000 |
|  KB Shinjasanaubo Fund |  | 132000 |
|  KB-Brain KOSDAQ Scale-Up Fund |  | 4800000 |
|  KB SPROTT Renewable Private Equity Fund I | 2499360 |  |
|  KB-Stonebridge Secondary Private Equity Fund | 1248439 | 631500 |
|  KB-NAU Special Situation Corporate Restructuring Private<br> Equity Fund | 660000 | 2352793 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | |
|:---|:---|:---|
|  Project Vanilla Co., Ltd. <sup>1</sup> |  | 525344 |
|  KB Bio Private Equity Fund III Ltd. <sup>1</sup> |  | 10000000 |
|  KB-KTB Technology Venture Fund | 4000000 |  |
|  KB Digital Platform Fund | 5000000 |  |
|  KB-SOLIDUS Healthcare Investment Fund | 1000000 |  |
|  KB-GeneN Medical Venture Fund 1 | 2000000 |  |
|  KB-BridgePole Venture Investment Fund | 850000 |  |
|  KB-Kyobo New Mobility Power Fund | 3000000 |  |
|  JS Private Equity Fund III | 1700000 |  |
|  Mirae Asset Mobility Investment Fund I | 2000000 |  |
|  KB-FT 1st Green Growth Investment Fund | 2000000 |  |
|  THE CHAEUL FUND NO.1 <sup>2</sup> | 1000000 |  |
|  POSITIVE Sobujang Venture Fund No.1 | 2000000 |  |
|  KB-NP Green ESG New Technology Venture Capital Fund | 3740000 |  |
|  Hisstory 2022 Fintech Fund | 2000000 |  |
|  PEBBLES-MW M.C.E New Technology Investment Fund 1st | 2000000 |  |
|  KB Star REIT | 134772782 |  |
|  KB Bio Private Equity Investment Fund IV | 7500000 |  |
|  Nextrade Co., Ltd. | 9700000 |  |
|  Apollo REIT PropCo LLC <sup>1</sup> | 19968049 | 19968049 |
|  **Others** |  |  |
|  Star-Lord General Investors Private Real Estate Investment Company No.10 | 20000000 |  |
|  KB NA Compass Energy Private Special Asset Fund <sup>1</sup> | 606975 | 21823276 |
|  Meritz Private Real Estate Fund 9-2 | 1486 | 5306 |
|  KB Global Core Bond Securities Master Fund(Bond) |  | 5000000 |
|  KB Global Platform Fund | 3200000 | 2460000 |
|  KB Wisestar Private Real Estate Fund Investment Trust No. 1 |  | 1749177 |
|  KB KBSTAR 30-Years Treasurybond Enhanced ETF <sup>1</sup> |  | 691351 |
|  KB Aircraft Loan Private Special Asset Fund Investment<br> Trust No. 1 |  | 32265511 |
|  KB New Deal Innovation Fund | 4800000 |  |
|  KB Development Blind General Private Real Estate Investment Trust No.2 | 3240000 |  |
|  KB Prime Digital Platform Fund | 900000 |  |
|  KB Secondary Plus Fund | 1180000 |  |
|  Paramark KB Fund I | 4148023 | 772023 |
|  KB Scale-up Fund No.2 | 1500000 |  |
|  KB KBSTAR Nov 2023 Term Credit ETF | 14862445 | 4905170 |

---

<sup>1</sup> These companies are not related party as at December 31, 2022.

<sup>2</sup> Changed company name from SKS IB NEW M&T FUND NO.1 to THE CHAEUL FUND NO.1 for the year ended December 31, 2022.

---

| | | |
|:---|:---|:---|
| *(In thousands of Korean won)* | **2021** | **2021** |
|  | **Contribution** | **Collection and others** |
|  **Associates** |  |  |
|  KB New Paradigm Agriculture Venture Fund |  | 2275000 |
|  KB KONEX Market Vitalization Fund |  | 5550000 |
|  KB-KDBC Pre-IPO New Technology Business Investment Fund |  | 2400000 |
|  KBTS Technology Venture Private Equity Fund | 880000 | 1536000 |
|  KB-SJ Tourism Venture Fund | 500000 |  |
|  KB-Brain KOSDAQ Scale-Up Fund | 3750000 | 4050000 |
|  KB-Stonebridge Secondary Private Equity Fund | 3788000 | 1692584 |
|  KB-UTC Inno-Tech Venture Fund | 1695000 | 375000 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 3846000 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | |
|:---|:---|:---|
|  KB Shinjasanaubo Fund | 880000 | 264000 |
|  JR GLOBAL REIT <sup>1</sup> |  | 65025000 |
|  Keystone-Hyundai Sec. No.1 Private Equity Fund <sup>1</sup> |  | 1925000 |
|  K The fifteenth Real Estate Investment Trust <sup>1</sup> | 8600000 | 8600000 |
|  KB Private Equity Fund III <sup>1</sup> |  | 8 |
|  KB Bio Private Equity Fund III Ltd. | 10000000 |  |
|  KB Global Commerce Private Equity Investment Fund | 7000000 |  |
|  KB-KTB Technology Venture Fund | 2000000 |  |
|  KB Bio Global Expansion Private Equity Fund No.1 | 15000000 |  |
|  KB Digital Platform Fund | 4500000 |  |
|  KB-SOLIDUS Healthcare Investment Fund | 100000 |  |
|  **Others** |  |  |
|  KB NA Compass Energy Private Special Asset Fund | 1513600 | 2056553 |
|  Meritz Private Real Estate Fund 9-2 | 1053 | 5954 |
|  KB Global Core Bond Securities Master Fund(Bond) |  | 15000000 |
|  KB Onkookmin TDF 2045 Fund |  | 1400000 |
|  KB Global Platform Fund | 5400000 |  |
|  KB Onkookmin Life Income RIF 20 Feeder Fund(FoFs) |  | 2500000 |
|  KB Onkookmin Life Income RIF 40 Feeder Fund(FoFs) |  | 2500000 |
|  KB BMO senior loan private special asset fund 2 | 4477004 |  |
|  KB Multi Alpha Plus Private Fund 1 | 10000000 |  |
|  KB KBSTAR 30-Years Treasurybond Enhanced ETF | 6311671 | 5806617 |
|  KB Aircraft Loan Private Special Asset Fund Investment Trust No. 1 | 33017696 | 752186 |
|  KB New Deal Innovation Fund | 2000000 |  |
|  Paramark KB Fund I | 680000 |  |

---

<sup>1</sup> These companies are not related party as at December 31, 2021.

Details of guarantees and assets pledged as collateral to related parties as at December 31, 2022 and 2021 are as follows:

(a) Guarantees

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Limit amount** | **Limit amount** | **Limit amount** | **Limit amount** | **Limit amount** |
| *(in thousands of Korean won)* | **Details** | **Details** | **2022** | **2022** | **2021** |
|  KB Star Galaxy Towers REIT |  | Funding<br>replenishment<br>agreement B |  | 40000000 |  |

---

(b) Assets pledged as collateral

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of*<br> *Korean won)* | **Details of**<br> **assets pledged** | **2022** | **2022** | **2021** | **2021** |
|  |  | **Carrying<br>amount** | **Collateralized<br>amount** | **Carrying<br>amount** | **Collateralized<br>amount** |
|  Kookmin Bank | Time deposits and others | 173000000 | 167000000 | 173000000 | 167000000 |
|  | Bonds denominated in Korean won | 16541459 | 20000000 | 21183449 | 20000000 |
|  | Investment properties |  |  | 481945657 | 11967467 |

---

As at December 31, 2022, the Group received securities amounting to W 62,000 million (2021 : W 54,000 million) as a collateral from Kookmin bank and the Group has W 140,000 million (2021 : W 140,000 million) of credit line such as loan agreement.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Details of unused loan commitments provided to the related parties as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(In thousands of Korean won)* | **Details** | **Amounts** | **Amounts** |
|  |  | **2022** | **2021** |
|  KBTS Technology Venture Private Equity Fund | Purchase agreements of securities |  | 176000 |
|  KB Wisestar Private Real Estate Fund Investment Trust No. 1 | Purchase agreements of securities | 19000 | 19000 |
|  KB SPROTT Renewable Private Equity Fund I | Purchase agreements of securities |  | 3817225 |
|  KB-Stonebridge Secondary Private Equity Fund | Purchase agreements of securities |  | 1594000 |
|  KB Global Platform Fund | Purchase agreements of securities |  | 3200000 |
|  KB Global Infra Private Special Asset Fund No.5 | Purchase agreements of securities | 4999773 | 4999773 |
|  KB Global Infra Private Special Asset Fund No.6 | Purchase agreements of securities | 4999773 | 4999773 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | Purchase agreements of securities | 7644000 | 8304000 |
|  KB BMO senior loan private special asset fund | Purchase agreements of securities | 19497 | 18239 |
|  KB-KTB Technology Venture Fund | Purchase agreements of securities | 4000000 | 8000000 |
|  Paramark KB Fund I | Purchase agreements of securities | 5944000 | 9320000 |
|  KB New Deal Innovation Fund | Purchase agreements of securities | 3200000 | 8000000 |
|  KB-SOLIDUS Healthcare Investment Fund | Purchase agreements of securities | 3900000 | 4900000 |
|  KB Digital Platform Fund | Purchase agreements of securities | 40500000 | 45500000 |
|  KB Secondary Plus Fund | Purchase agreements of securities | 1181000 |  |
|  KB Scale-up Fund No.2 | Purchase agreements of securities | 8500000 |  |
|  KB-NP Green ESG New Technology Venture Capital Fund | Purchase agreements of securities | 16260000 |  |
|  KB Star Galaxy Towers REIT | Purchase agreements of securities | 40000000 |  |
|  KB Prime Digital Platform Fund | Purchase agreements of securities | 3600000 |  |

---

The Group received credit card commitment amounting to W 21,000 million(W 21,000 million as at December 31, 2021) from Kookmin Card Co., Ltd. as at December 31, 2022.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Debt instruments purchased or sold via the Group by the related party for the years ended December 31, 2022 and 2021, are as follows.

---

| | | |
|:---|:---|:---|
|  | **2022** | **2022** |
| *(in thousands of Korean won)* | **Sale** | **Purchase <sup>1</sup>** |
|  Kookmin Bank | 7341903732 | 3791777742 |
|  KB Life Insurance Co., Ltd. | 92619359 | 11922239 |
|  KB Insurance Co., Ltd | 794858152 | 362105311 |
|  KB Life Insurance Co., Ltd. (former Prudential Life Insurance Co., Ltd.) <sup>2</sup> | 65611000 | 325130900 |
|  KB Kookmin Card Co., Ltd. |  | 70000000 |
|  KB Capital Co., Ltd. |  | 70000000 |

---

<sup>1</sup> Debt instruments issued by the related party and purchased by the Group are included.

<sup>2</sup> Changed company name from Prudential Life Insurance Co., Ltd. to KB Life Insurance Co., Ltd. for the year ended December 31, 2022.

---

| | | |
|:---|:---|:---|
|  | **2021** | **2021** |
| *(in thousands of Korean won)* | **Sale** | **Purchase <sup>1</sup>** |
|  Kookmin Bank | 9642170271 | 9005606675 |
|  KB Life Insurance Co., Ltd. | 272656940 | 88646788 |
|  KB Insurance Co., Ltd | 853998306 | 446196491 |
|  KB Kookmin Card Co., Ltd. |  | 40000000 |
|  KB Capital Co., Ltd. |  | 130000000 |

---

<sup>1</sup> Debt instruments issued by the related party and purchased by the Group are included.

The key management includes registered or unregistered directors, members of BOD, CFO, person in charge for internal audit and their compensation for the years ended December 31, 2022 and 2021, are as follows.

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Short-term salaries |  | 19619299 |  | 9493422 |
|  Post-employment benefits |  | 654295 |  | 579895 |
|  Share-based payment |  | 10499614 |  | 16001106 |
|  |  | 30773208 |  | 26074423 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

43. Supplemental Cash Flow Information

Adjustments for non-cash items of cash flows from operating activities for the years ended December 31, 2022 and 2021, are as follows.

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Interest income | (1160030186) | (826686736) |
|  Interest expenses | 618109328 | 268260224 |
|  Dividend income and distribution income | (58263080) | (47721978) |
|  Tax expenses | 67499191 | 217752228 |
|  Gains on valuation of financial assets (liabilities) required to be mandatorily measured at FVTPL | (333119842) | (269490685) |
|  Losses on valuation of financial assets (liabilities) required to be mandatorily measured at FVTPL | 831544707 | 418287034 |
|  Gains on valuation of financial assets (liabilities) designated at FVTPL | (1034347105) | (602482365) |
|  Losses on valuation of financial assets (liabilities) designated at FVTPL | 101117268 | 170830700 |
|  Gains on valuation of derivative financial assets (liabilities) | (3768918242) | (1520100781) |
|  Losses on valuation of derivative financial assets (liabilities) | 3949042388 | 1675607385 |
|  Gains or losses on disposal of financial assets at FVOCI | 16397562 | 10811918 |
|  Provision for allowances for loan losses | 29170136 | 17369802 |
|  Depreciation | 60392226 | 55730775 |
|  Amortization | 27876572 | 22397762 |
|  Foreign currency translations | 40092662 | (58221499) |
|  Others | 40749617 | 50343825 |
|  | (572686798) | (417312391) |

---

Changes in operating assets and liabilities of cash flows for the years ended December 31, 2022 and 2021, are as follows.

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Deposits in financial institutions | (591602391) | (116093291) |
|  Financial assets required to be mandatorily measured at FVTPL | 4070185916 | (741184122) |
|  Derivative financial instruments | 376528219 | (47323458) |
|  Loans measured at amortised cost | (2277528256) | (965561358) |
|  Other assets | 861810325 | 3159131548 |
|  Deposit liabilities | (1627275300) | 690719218 |
|  Financial liabilities required to be mandatorily measured at FVTPL | (649762362) | 978686697 |
|  Financial liabilities designated at FVTPL | 1913770458 | (185467288) |
|  Defined benefit obligation | (23185907) | (16828530) |
|  Securities sold under repurchase agreements | (2784278687) | (1240816274) |
|  Other liabilities | (1103619065) | (3249573025) |
|  | (1834957050) | (1734309883) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Changes in liabilities of cash flows from financing activities for the years ended December 31, 2022 and 2021, are as follows.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of*<br> *Korean won)* | **Borrowings** | **Debentures** | **Guarantee<br>deposits** | **Lease<br>liabilities** | **Others** | **Total** |
|  Beginning balance (net) | 15252419029 | 2423653655 | 26518264 | 127992813 | 228717913 | 18059301674 |
|  Cash Transactions | 2309764192 | (545885919) | 498469 | (30267166) | (28794866) | 1705313710 |
|  Exchanges in foreign currency | (26690) | 18701008 | (33330) | (279624) |  | 18361364 |
|  Changes in consolidation scope | 454724863 |  | 29956 | 141239 |  | 454896058 |
|  Non-cash transactions | (551182209) | (20362470) | (18118022) | 28005978 | (32748036) | (594404760) |
|  Ending balance(net) | 17465699185 | 1876106274 | 8894337 | 125593239 | 167175011 | 19643468046 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of*<br> *Korean won)* | **Borrowings** | **Debentures** | **Guarantee<br>deposits** | **Lease<br>liabilities** | **Others** | **Total** |
|  Beginning balance (net) | 14996548684 | 1821496969 | 27209689 | 148849442 | 195601085 | 17189705869 |
|  Cash Transactions | 643655553 | 599948542 | (816464) | (32260777) | 23956770 | 1234483624 |
|  Exchanges in foreign currency | 48656448 | 4886332 | 11969 | (211878) |  | 53342871 |
|  Changes in consolidation scope | (436441656) |  |  |  |  | (436441656) |
|  Non-cash transactions |  | (2678188) | 113070 | 11616026 | 9160058 | 18210966 |
|  Ending balance(net) | 15252419029 | 2423653655 | 26518264 | 127992813 | 228717913 | 18059301674 |

---

**44. Non-cash Transactions** 

Significant non-cash transactions from investing activities and financing activities which are not included in consolidated statements of cash flows for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Increase due to gains on valuation of financial assets at FVOCI |  | 19904095 |  | 13976607 |
|  Replacement of investments in associates and assets held for sale |  |  |  | 169424284 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**45. Interests in Unconsolidated Structured Entities** 

Information about interests in unconsolidated structured entities, which the Group does not have control over, including the nature, purpose and activities of the structured entity and how the structured entity is financed, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Nature** | **Purpose** | **Activities** | **Method of financing** |
| Asset-backed<br> securitization | • Early cash generation through transfer of securitization assets<br>• Fees earned as services to SPC, such as providing lines of credit and ABCP purchase commitments | • Fulfillment of Asset-backed securitization plan<br>• Purchase and transfer of securitization assets<br>• Issuance and repayment of ABS and ABCP | • Issuance of ABS and ABCP based on securitization assets |
| Project financing | • Granting PF loans to SOC and real estate<br>• Granting loans to ships/ aircrafts SPC | • Construction of SOC and real estate<br>• Building ships/ construction and purchase of aircrafts | • Loan commitments through Credit Line, providing lines of credit and investment agreements |
| Trust | Management of financial trusts;<br>• Development trust<br>• General unspecified money trust<br>• Principal guaranteed trust | • Development, management, and disposal of trusted real estate assets<br>• Payment of trust fees and allocation of trust profits. | • Sales of financial trusts |
| Investment funds | • Investment in beneficiary certificates<br>• Investment in PEF and partnerships | • Management of fund assets<br>• Payment of fund fees and allocation of fund profits | • Sales of beneficiary certificate instruments<br>• Investment of managing partners and limited partners |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

Details of the size of the interest in unconsolidated structured entities and the nature of risks related are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Asset-backed**<br> **securitization** | **Investment fund** | **Others** | **Total** |
|  Total assets of unconsolidated structured entities | 16840274262 | 26227955016 | 13832783457 | 56901012735 |
|  Assets recognized in the consolidated financial statements of the Group |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans | 344336080 |  | 1223588027 | 1567924107 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities | 3547286127 | 1714215712 | 3958500 | 5265460339 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in associates |  | 259437774 |  | 259437774 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | 1169590 |  | 1315 | 1170905 |
|  | 3892791797 | 1973653486 | 1227547842 | 7093993125 |
|  Liabilities recognized in the consolidated financial statements of the Group |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives financial assets | 697664 | 2102146 |  | 2799810 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities | 51883899 |  | 238770 | 52122669 |
|  | 52581563 | 2102146 | 238770 | 54922479 |
|  Maximum exposure to loss |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Holding assets | 3892791796 | 1973653486 | 1227547842 | 7093993124 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Payment guarantee and loan commitments | 358038047 | 378815262 |  | 736853309 |
|  | 4250829843 | 2352468748 | 1227547842 | 7830846433 |
|  The way that the maximum exposure to loss is determined | Amount of<br>credit offerings<br>and purchase<br>agreement | Amount of<br>investment<br>commitment | Amount of<br>investment<br>commitment |  |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Asset-backed**<br> **securitization** | **Investment fund** | **Others** | **Total** |
|  Total assets of unconsolidated structured entities | 28911108294 | 19947388460 | 4289171415 | 53147668169 |
|  Assets recognized in the consolidated financial statements of the Group |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans | 398657425 |  | 463524918 | 862182343 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities | 3613761414 | 1482094992 | 4995000 | 5100851406 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in associates |  | 106350816 |  | 106350816 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives financial assets | 180842 |  |  | 180842 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | 11226387 |  | 107631 | 11334018 |
|  | 4023826068 | 1588445808 | 468627549 | 6080899425 |
|  Liabilities recognized in the consolidated financial statements of the Group |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities | 29646421 |  | 5166083 | 34812504 |
|  | 29646421 |  | 5166083 | 34812504 |
|  Maximum exposure to loss |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Holding assets | 4023826069 | 1588445808 | 468627549 | 6080899426 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Payment guarantee and loan commitments | 631893710 | 394378798 | 92100000 | 1118372508 |
|  | 4655719779 | 1982824606 | 560727549 | 7199271934 |
|  The way that the maximum exposure to loss is determined | Amount of<br>credit offerings<br>and purchase<br>agreement | Amount of<br>investment<br>commitment | Amount of<br>investment<br>commitment |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**46. Business Combination** 

As of February 14, 2022, the Group acquired 65.0% shares in PT. KB Valbury Sekurita for W 57,222 million in cash and incorporated it as a subsidiary.

The main reason for the business combination is to diversify the global business by entering Indonesian capital market through takeover, and to strengthen competitiveness in the global sector through business with other overseas affiliates and maximization of operational synergies.

Accounting treatment for acquisition of shares related to this business combination is as follows:

---

| | |
|:---|:---|
| *(In thousands of Korean won)* |  |
|  **Consideration transferred** | 57221996 |
|  **Assets acquired** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | 39924724 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits | 1558581 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at fair value through profit or loss | 1712718 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost | 30509425 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Property and equipment | 8440290 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment properties | 2618619 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current tax assets | 68213 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred tax assets | 726818 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets | 28546988 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | 165379 |
|  | 114271755 |
|  **Liabilities assumed** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings | 14286341 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net defined benefit liabilities | 2634640 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current tax liabilities | 1380012 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities | 24497141 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities | 140575 |
|  | 42938709 |
|  **Net assets at fair value as identifiable** | 71333046 |
|  **Non-controlling interest** | 25180721 |
|  **Goodwill** | 11069671 |

---

The Group reflected net income of PT. KB Valbury Sekuritas as of W 5,100 million after the acquisition date in the consolidated statement of comprehensive income. Net cash outflow related to this business combination was W 17,297 million.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES CO., LTD. and Subsidiaries** 

**Notes to the Consolidated Financial Statements** 

**December 31, 2022 and 2021** 

------

**47. Disposal group classified as held for sale** 

The Parent Company had decided to sell all shares in 498 Seventh KOR Holdco LP owned by Hanwha US Equity Strategy Private Real Estate Fund 3, a consolidated subsidiary, and 498 Seventh KOR LLC. owned by 498 Seventh KOR Holdco LP. which is consolidated subsidiary.

Accordingly, as at December 31, 2021, the Group classified the assets of 498 Seventh KOR Holdco LP and 498 Seventh KOR LLC as the disposal group classified as held for sale, and the accumulated gains and losses from overseas operations were classified as other comprehensive income for the disposal group classified as held for sale. During the previous year, the Group had entered into a share transfer agreement with JR No.28 Consignment Management Real Estate Investment Company and the sale process was completed in January 2022. As a result, the disposal group classified as held for sale is eliminated as at December 31, 2022.

As at December 31, 2022, There is no asset and liability classified as the disposal group classified as held for sale.

As of December 31, 2021, the main contents of the assets classified as the disposal group classified as held for sale were as follows, and there was no liability directly related to the disposal group classified as held for sale.

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 498 Seventh KOR<br>Holdco LP. | 498 Seventh KOR<br>LLC. | **Total** |
|  Disposal Group classified as held for sale |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits | 556046 | 512346 | 1068392 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in associates |  | 169424284 | 169424284 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets |  | 1256639 | 1256639 |
|  | 556046 | 171193269 | 171749315 |

---

As at December 31, 2021, there was no recognized impairment losses related to disposal groups classified as held for sale.

Other comprehensive incomes directly recognized relating to the disposal group classified as held for sale as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** | **2021** |
|  Accumulated exchange gains on foreign business transactions |  |  | 7670746 |

---

**48. Event after the reporting period** 

The Group intermediated a fund related to the apartment rental business for disabled people in Australia, but the fund was suspended due to the breach of contract by the local Australian borrower. In this regard, as at December 31, 2022, three lawsuits such as claims for recovery of unjust enrichment have been filed from institutional investors. Among three lawsuits, the first-instance verdict for the one case was announced on February 7, 2023, ordering the payment of the investment principal and delayed interest thereon. This is an adjusting event after the reporting period, and as at December 31, 2022, litigation provision liabilities for three litigation have been added to the consolidated financial statements. The specifics of the relevant litigation is described in Note 41.

------

##### [**Table of Contents**](#toc)
**Exhibit EX99.2** 

**KB SECURITIES CO., LTD.** 

**Separate Financial Statements** 

**December 31, 2022 and 2021** 

**(With Independent Auditors' Report Thereon)** 

------

##### [**Table of Contents**](#toc)

---

| | |
|:---|:---|
|  | **Page(s)** |
|  [**Independent Auditors' Report**](#ex99_2477895_1) | 1~2 |
|  **Separate Financial Statements** |  |
|  [Separate Statements of Financial Position](#ex99_2477895_2) | 3 |
|  [Separate Statements of Profit or Loss](#ex99_2477895_3) | 4 |
|  [Separate Statements of Comprehensive Income](#ex99_2477895_4) | 5 |
|  [Separate Statements of Changes in Equity](#ex99_2477895_5) | 6 |
|  [Separate Statements of Cash Flows](#ex99_2477895_6) | 7 |
|  [**Notes to the Separate Financial Statements**](#ex99_2477895_7) | 8~134 |
|  [**Report on Independent Auditors' Review of Internal Control over Financial Reporting**](#ex99_2477895_8) | 135 |
|  [**Report on the Effectiveness of the Internal Control over Financial Reporting**](#ex99_2477895_9) | 136 |

---

------

##### [**Table of Contents**](#toc)
**Independent Auditors' Report** 

(Based on a report originally issued in Korean)

The Board of Directors and Stockholder

KB Securities Co., Ltd.:

*Opinion* 

We have audited the separate financial statements of KB Securities Co., Ltd. ("the Company"), which comprise the separate statements of financial position as of December 31, 2022 and 2021, the separate statements of profit or loss, comprehensive income, changes in equity and cash flows for the years then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.

In our opinion, the accompanying separate financial statements present fairly, in all material respects, the separate financial position of the Company as of December 31, 2022 and 2021, and its separate financial performance and its cash flows for the years then ended in accordance with Korean International Financial Reporting Standards ("K-IFRS").

*Basis for Opinion* 

We conducted our audit in accordance with Korean Standards on Auditing ("KSAs"). Our responsibilities under those standards are further described in the *Auditors' Responsibilities for the Audit of the Separate Financial Statements* section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the separate financial statements in Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

*Other Matters* 

The procedures and practices utilized in the Republic of Korea to audit such separate financial statements may differ from those generally accepted and applied in other countries.

*Responsibilities of Management and Those Charged with Governance for the Separate Financial Statements* 

Management is responsible for the preparation and fair presentation of the separate financial statements in accordance with K-IFRS, and for such internal control as management determines is necessary to enable the preparation of separate financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the separate financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

------

##### [**Table of Contents**](#toc)
Those charged with governance are responsible for overseeing the Company's financial reporting process.

*Auditors' Responsibilities for the Audit of the Separate Financial Statements* 

Our objectives are to obtain reasonable assurance about whether the separate financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these separate financial statements.

As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Identify and assess the risks of material misstatement of the separate financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the appropriateness of accounting policies used in the preparation of the separate financial statements
and the reasonableness of accounting estimates and related disclosures made by management.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we
are required to draw attention in our auditors' report to the related disclosures in the separate financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditors' report. However, future events or conditions may cause the Company to cease to continue as a going concern.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the overall presentation, structure and content of the separate financial statements, including the
disclosures, and whether the separate financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in the internal controls that we identify during our audit.

/s/ KPMG Samjong Accounting Corp.

Seoul, Korea

March 7, 2023

&nbsp;&nbsp;&nbsp; This report is effective as of March 7, 2023, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying separate financial statements and notes thereto. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any.<br>

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Separate Statements of Financial Position** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in Korean won)* | **Notes** | **2022** | **2021** |
|  **Assets** | **Assets** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits | 5363738 | 4028288407282 | 3345119599713 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at fair value through profit or loss | 6363738 | 28995718417735 | 33833764375768 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets | 736373839 | 1701970055618 | 811015165800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at fair value through other comprehensive income | 8363738 | 4798845458840 | 3838298230251 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in subsidiaries | 9 | 962256250447 | 1031745305199 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in associates | 9 | 200226065772 | 129322034556 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets measured at amortised cost | 1036373839 | 6566785893434 | 5430443815883 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Property and equipment | 1140 | 253806249717 | 205420354106 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment properties | 12 | 14659854297 | 17754977445 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Intangible assets | 13 | 185490560652 | 170893377135 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets | 1436373839 | 2698990294779 | 3724896077146 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | 15 | 243677135482 | 31365019508 |
|  **Total assets** | **Total assets** | 50650714644055 | 52570038332510 |
|  **Liabilities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit liabilities | 16363738 | 6819371624902 | 8400368429840 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at fair value through profit or loss | 636373839 | 12171579477522 | 11986846570347 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities | 736373839 | 2318063711035 | 836699401537 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings | 1736373839 | 20575667240927 | 21994629818393 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net defined benefit liabilities | 18 | 54817226956 | 55619888673 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred tax liabilities | 35 | 73845106780 | 28586947555 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Provisions | 1945 | 150934451093 | 106098065531 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities | 203637383940 | 2243572915000 | 3310748094176 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities | 21 | 427324355976 | 402286997863 |
|  **Total liabilities** | **Total liabilities** | 44835176110191 | 47121884213915 |
|  **Equity** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Share capital | 22 | 1493102120000 | 1493102120000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hybrid securities | 23 | 506130312000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other paid-in capital | 24 | 1479110085557 | 1479110085557 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retained earnings | 25 | 2038072084071 | 2270994816373 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other components of equity | 26 | 299123932236 | 204947096665 |
|  **Total equity** | **Total equity** | 5815538533864 | 5448154118595 |
|  **Total liabilities and equity** | **Total liabilities and equity** | 50650714644055 | 52570038332510 |

---

The above separate statements of financial position should be read in conjunction with the accompanying notes

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Separate Statements of Profit or Loss** 

**Years Ended December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in Korean won)* | **Notes** | **2022** | **2021** |
|  **Operating income** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fee and commission income | 27 | 921810522457 | 1167083027784 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on valuation and disposal of financial instruments | 28 | 10624381090948 | 5524737738056 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income | 29 | 1013459676836 | 737552790032 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income from financial instruments at FVTPL |  | 539707432644 | 400472062945 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income in applying of effective interest rate |  | 473752244192 | 337080727087 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on valuation and disposal of financial assets measured at amortised costs | 30 | 3890158961 | 3142534692 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on foreign currency transactions | 31 | 1256489183394 | 777874300249 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other operating income | 32 | 156781049046 | 150533956215 |
|  |  | 13976811681642 | 8360924347028 |
|  **Operating expenses** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fee and commission expense | 27 | 166378277250 | 171249369130 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on valuation and disposal of financial instruments | 28 | 10997065263414 | 5550779222945 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest expense | 29 | 501613636678 | 212429224934 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on valuation and disposal of financial assets measured at amortised cost | 30 | 14818638031 | 7008606947 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on foreign currency transactions | 31 | 1256540975538 | 745735017357 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Selling and administrative expenses | 33 | 769850286492 | 821513424479 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other operating expenses | 32 | 53748010547 | 45721673439 |
|  |  | 13760015087950 | 7554436539231 |
|  **Operating profit** |  | 216796593692 | 806487807797 |
|  Non-operating income | 34 | 93582812809 | 58834512565 |
|  Non-operating expenses | 34 | 79836928036 | 53117324403 |
|  **Profit before income tax** |  | 230542478465 | 812204995959 |
|  Income tax expense | 35 | 60247522429 | 214559285270 |
|  **Profit for the year** |  | 170294956036 | 597645710689 |

---

The above separate statements of profit or loss should be read in conjunction with the accompanying notes

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Separate Statements of Comprehensive Income** 

**Years Ended December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in Korean won)* | **Notes** | **2022** | **2021** |
|  **Profit for the year** |  | 170294956036 | 597645710689 |
|  **Other comprehensive income(loss)** |  |  |  |
|  **Items that will not be reclassified to profit or loss** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net gains on valuation of equity instruments at fair value through other comprehensive income | 826 | 27415825649 | 27779973437 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fair value changes on financial liabilities designated at fair value due to own credit risk | 626 | 38855084533 | 13714607803 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of the net defined benefit liabilities | 1826 | 2744359393 | (2237583109) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Revaluation of property and equipment |  | 35572043723 |  |
|  **Items that may be subsequently reclassified to profit or loss** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net losses on valuation of debt instrument at fair value through other comprehensive income | 826 | (10149158628) | (17213330222) |
|  **Other comprehensive income for the year, net of tax** |  | 94438154670 | 22043667909 |
|  **Total comprehensive income for the year** |  | 264733110706 | 619689378598 |

---

The above separate statements of comprehensive income should be read in conjunction with the accompanying notes

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Separate Statements of Changes in Equity** 

**Years Ended December 31, 2022 and 2021** 

------

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | | | **Other paid in capital** | **Other paid in capital** | | | |
|  | **Share**<br> **Capital** | **Hybrid**<br> **Securities** | **Share**<br> **Premium** | **Other**<br> **Equity** | **Retained**<br> **Earnings** | **Other**<br> **Components**<br> **of Equity** | **Total Equity** |
|  **Balance at January 1, 2021** | 1493102120000 |  | 1142353750001 | 336756335556 | 1873327831871 | 182924702569 | 5028464739997 |
|  **Dividends** |  |  |  |  | (200000000000) |  | (200000000000) |
|  **Revaluation of property and equipment** |  |  |  |  | 21273813 | (21273813) |  |
|  **Total comprehensive income** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit for the year |  |  |  |  | 597645710689 |  | 597645710689 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other comprehensive income |  |  |  |  |  | 22043667909 | 22043667909 |
|  **Balance at December 31, 2021** | 1493102120000 |  | 1142353750001 | 336756335556 | 2270994816373 | 204947096665 | 5448154118595 |
|  **Balance at January 1, 2022** | 1493102120000 |  | 1142353750001 | 336756335556 | 2270994816373 | 204947096665 | 5448154118595 |
|  **Issuance of hybrid securities** |  | 506130312000 |  |  |  |  | 506130312000 |
|  **Dividends of hybrid securities** |  |  |  |  | (3479007437) |  | (3479007437) |
|  **Dividends** |  |  |  |  | (400000000000) |  | (400000000000) |
|  **Revaluation of property and equipment** |  |  |  |  | 261319099 | (261319099) |  |
|  **Total comprehensive income** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit for the year |  |  |  |  | 170294956036 |  | 170294956036 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other comprehensive income |  |  |  |  |  | 94438154670 | 94438154670 |
|  **Balance at December 31, 2022** | 1493102120000 | 506130312000 | 1142353750001 | 336756335556 | 2038072084071 | 299123932236 | 5815538533864 |

---

The above separate statements of changes in equity should be read in conjunction with the accompanying notes

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Separate Statements of Cash Flows** 

**Years Ended December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in Korean won)* | **Notes** | **2022** | **2021** |
|  **Cash flows from operating activities** | **Cash flows from operating activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash generated from operating activities |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit for the year |  | 170294956036 | 597645710689 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustment for non-cash items | 43 | (547044387464) | (403257010550) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in operating assets and liabilities | 43 | (382676653008) | (1030962895682) |
|  |  | (759426084436) | (836574195543) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest received |  | 1103052980271 | 772606668847 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest paid |  | (448730584509) | (207095952914) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends received |  | 47165956301 | 43971420825 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income taxes paid |  | (204006008899) | (211038080224) |
|  **Net cash used in operating activities** |  | (261943741272) | (438130139009) |
|  **Cash flows from investing activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Decrease in long-term deposit held by bank |  | 498550000000 | 446123655200 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of financial assets at fair value through other comprehensive income |  | (5425088782074) | (4678242030749) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of financial assets at fair value through other comprehensive income |  | 4476887646352 | 4731871208238 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of investments of subsidiaries and associates | 9 | (488146088553) | (478351517738) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of investment of subsidiaries and associates | 9 | 474612192592 | 167726385796 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of property and equipment | 11 | (22279332929) | (22944798945) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of property and equipment | 11 | 2763680568 | 683373612 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of intangible assets | 13 | (43838228413) | (36580886688) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of intangible assets | 13 | 1019665000 | 2086788000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of investment properties | 12 | 2986319434 | 1158894888 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | (21285090533) | (26298576016) |
|  **Net cash provided by (used in) investing activities** |  | (543818018556) | 107232495598 |
|  **Cash flows from financing activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase in borrowings | 43 | 1347511733452 | 720139535921 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Decrease in guarantee deposit liabilities | 43 | 518525155 | (3575925704) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends paid | 25 | (400000000000) | (200000000000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Redemption of principal elements of lease payments | 43 | (30122914297) | (31849047481) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Issuance of hybrid securities | 23 | 506130312000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends of hybrid securities | 25 | (3437500000) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase in other liabilities | 43 | 2911250000 |  |
|  **Net cash provided by financing activities** |  | 1423511406310 | 484714562736 |
|  **Effect of exchange rate changes on cash and cash equivalents** |  | (4027082739) | 1379611661 |
|  **Net increase in cash and cash equivalents** |  | 613722563743 | 155196530986 |
|  **Cash and cash equivalents at the beginning of the year** | 5 | 414147798325 | 258951267339 |
|  **Cash and cash equivalents at the end of the year** | 5 | 1027870362068 | 414147798325 |

---

The above separate statements of cash flows should be read in conjunction with the accompanying notes

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**1. The Company** 

KB Securities Co., Ltd. (the "Company" or "KB Securities", formerly, Hyundai Securities Co., Ltd.) was established on June 1, 1962, under the name of Kookil Securities Co., Ltd. On June 5, 1986, the Company changed its name to "Hyundai Securities Co., Ltd.". After several capital increases, the share capital of the Company amounts to W 1,493,102 million as at December 31, 2022.

The Company became a wholly owned subsidiary of KB Financial Group Inc. on October 19, 2016, through a comprehensive exchange of shares. At the end of the reporting period, KB Financial Group Inc. owns 100% of ordinary shares of the Company.

Meanwhile, the Company merged with KB Investment & Securities Co., Ltd. (the "KB Investment & Securities") on December 30, 2016 as a surviving company and changed its name to KB Securities Co., Ltd. As at December 31, 2022, the Company has 104 branch offices in Korea and one overseas branch office.

**2. Significant Accounting Policies** 

The principal accounting policies applied in the preparation of these separate financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

**2.1 Basis of Preparation** 

The Company maintains its accounting records in Korean won and prepares statutory financial statements in the Korean language (Hangul) in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (Korean IFRS). The accompanying separate financial statements have been condensed, restructured and translated into English from the Korean language financial statements.

Certain information attached to the Korean language financial statements, but not required for a fair presentation of the Company's financial position, financial performance or cash flows, is not presented in the accompanying separate financial statements.

The separate financial statements of the Company have been prepared in accordance with Korean IFRS. These are the standards and related interpretations issued by the International Accounting Standards Board (IASB) that have been adopted by the Republic of Korea.

The separate financial statements have been prepared on the historical cost basis except for the following items:

*•* *Certain financial assets and liabilities (including derivatives instruments), certain classes of property, plant and equipment and investment properties measured at fair value* 

*•* *Assets held for sale measured at fair value less costs to sell, and* 

*•* *Defined benefit plans* 

*•* *Plan assets measured at fair value* 

The preparation of the separate financial statements requires the use of certain critical accounting estimates. Management also needs to exercise judgement in applying the Company's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the separate financial statements are disclosed in Note 3.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.2 Changes in Accounting Policy and Disclosures** 

2.2.1 New and amended standards adopted by the Company

The Company has applied the following amended standards for the first time for its annual reporting period commencing January 1, 2022.

• *Amendments to Korean IFRS No. 1103 Business Combination – Reference to the Conceptual Framework* 

The amendments update a reference of definition of assets and liabilities to qualify for recognition in revised Conceptual Framework for Financial Reporting. However, the amendments add an exception for the recognition of liabilities and contingent liabilities within the scope of Korean IFRS No. 1037 *Provisions, Contingent Liabilities and Contingent Assets*, and Korean IFRS No. 2121 *Levies*. The amendments also confirm that contingent assets should not be recognized at the acquisition date. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. These amendments do not have a significant impact on the financial statements.

• *Amendments to Korean IFRS No. 1016 Property, Plant and Equipment – Proceeds before intended use* 

The amendments prohibit an entity from deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while the entity is preparing the asset for its intended use. Instead, the entity will recognize the proceeds from selling such items, and the costs of producing those items, as profit or loss. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. These amendments do not have a significant impact on the financial statements.

• *Amendments to Korean IFRS No. 1037 Provisions, Contingent Liabilities and Contingent Assets – Onerous Contracts: Cost of Fulfilling a Contract* 

The amendments clarify that the direct costs of fulfilling a contract include both the incremental costs of fulfilling the contract and an allocation of other costs directly related to fulfilling contracts when assessing whether the contract is onerous. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. These amendments do not have a significant impact on the financial statements.

2.2.2 The following amended standards have been published that are not mandatory for December 31, 2022 reporting periods and have not been early adopted by the Company.

• *Amendments to Korean IFRS No.1001 Presentation of Financial Statements—Classification of Liabilities as Current or Non-current* 

The amendments clarify that liabilities are classified as either current or non-current, depending on the substantive rights that exist at the end of the reporting period. Classification is unaffected by the likelihood that an entity will exercise the right to defer settlement of the liability or the management's expectations thereof. Also, the settlement of liability includes the transfer of the entity's own equity instruments; however, it would be excluded if an option to settle the liability by the transfer of the entity's own equity instruments is recognized separately from the liability as an equity component of a compound financial instrument. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Company does not expect that these amendments have a significant impact on the financial statements.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

• *Amendments to Korean IFRS No.1001 Presentation of Financial Statements – Accounting Policy Disclosure* 

The amendments require an entity to define and disclose their material accounting policy information. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Company does not expect that these amendments have a significant impact on the financial statements.

• *Amendments to Korean IFRS No.1001 Presentation of Financial Statements— Disclosure of gain or losses on valuation of financial liabilities subject to exercise price adjustment conditions* 

The amendments require disclosures about gains or losses on valuation occurred for the reporting period (but are limited to those included in profit or loss) for the conversion options or warrants (or financial liabilities with warrants), if all or part of the financial instrument whose exercise price is adjusted due to the issuers' stock price fluctuations, are classified as financial liabilities according to paragraph 11 of Korean IFRS No.1032 Financial Instruments: Presentation. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Company does not expect that these amendments have a significant impact on the financial statements.

• *Amendments to Korean IFRS No.1008 Accounting Policies, Changes in Accounting Estimates and Errors – Definition of Accounting Estimates* 

The amendments introduce the definition of accounting estimates and clarify how to distinguish changes in accounting estimates from changes in accounting policies. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Company does not expect that these amendments have a significant impact on the financial statements.

• *Amendments to Korean IFRS No.1012 Income Taxes – Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction* 

The amendments narrow the scope of the deferred tax recognition exemption so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. The amendments should be applied for annual reporting periods beginning on or after January 1, 2023, and earlier application is permitted. The Company does not expect that these amendments have a significant impact on the financial statements.

**2.3 Foreign Currency Translation** 

*(a) Functional and presentation currency*

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates ("the functional currency"). The financial statements are presented in Korean won, which is the Company's functional and presentation currency.

*(b) Transactions and balances*

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in profit or loss. They are deferred in other comprehensive income if they relate to qualifying cash flow hedges and qualifying effective portion of hedge of net investments in foreign operations, or are attributable to monetary part of the net investment in a foreign operation.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation differences on non-monetary assets and liabilities such as equities held at fair value through profit or loss are recognized in profit or loss as part of the fair value gain or loss and translation differences on non-monetary assets such as equities classified as available-for-sale financial assets are recognized in other comprehensive income.

**2.4 Investments in Associates and Subsidiaries** 

The Company has prepared the separate financial statements in accordance with Korean IFRS No.1027, *Separate Financial Statements*. Investments in associates and subsidiaries are recognized at cost. The Company recognizes dividend income from subsidiaries or associates in profit or loss when its right to receive dividend is established.

**2.5 Recognition and Measurement of Financial Instruments** 

2.5.1 Classification

The Company classifies financial assets as follows.

*•* *Those to be measured at fair value (through profit or loss or other comprehensive income)* 

*•* *Those to be measured at amortised cost* 

The classification depends on the Company's business model for managing the financial assets and the contractual terms of the cash flows.

For financial assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. For investments in debt instruments, this will depend on the business model in which the investment is held. The Company reclassifies debt investments when, and only when its business model for managing those assets changes.

For investments in equity instruments that are not held for trading, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income. Changes in fair value of non-designated equity investment are recognized in profit or loss.

2.5.2 Measurement

At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.

Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

2.5.2.1 Debt instruments

Subsequent measurement of debt instruments depends on the Company's business model for managing the asset and the cash flow characteristics of the asset. The Company classifies its debt instruments into one of the following three measurement categories:

(a) Amortised cost

Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognized in profit or loss when the asset is derecognized or impaired. Interest income from these financial assets is included in 'interest income' using the effective interest rate method.

(b) Fair value through other comprehensive income

Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets' cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income. Movements in the carrying amount are taken through other comprehensive income, except for the recognition of impairment loss (reversal of impairment loss), interest income and foreign exchange gains and losses which are recognized in profit or loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss. Interest income from these financial assets is included in 'interest income' using the effective interest rate method. Foreign exchange gains and losses are presented in 'gain or loss on foreign currency transaction' and impairment losses are presented in 'loss on valuation and disposal of financial instrument'.

(c) Fair value through profit or loss

Assets that do not meet the criteria for amortised cost or fair value through other comprehensive income are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognized in profit or loss and presented net in the statement of profit or loss within 'gain or loss on valuation and disposal of financial instrument' in the year in which it arises.

2.5.2.2 Equity instruments

The Company subsequently measures all equity investments at fair value. Where the Company's management has elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment. Dividend income from such investments continue to be recognized in profit or loss when the right to receive payments is established.

Changes in the fair value of financial assets at fair value through profit or loss are recognized in 'gain or loss on valuation and disposal of financial instrument' in the statement of profit or loss. Impairment loss (reversal of impairment loss) on equity investments measured at fair value through other comprehensive income are not reported separately from other changes in fair value.

2.5.3 Impairment

The Company assesses on a forward-looking basis expected credit losses associated with its debt instruments carried at amortised cost and fair value through other comprehensive income. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

Expected credit losses are a probability-weighted estimate of credit losses (i.e. the present value of all cash shortfalls) over the expected life of the financial instrument. The Company measures expected credit losses by reflecting reasonable and supportable information that is reasonably available at the reporting date without undue cost or effort, including information about past events, current conditions and forecasts of future economic conditions.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The Company uses the following three measurement techniques in accordance with Korean IFRS:

*•* *General approach: for financial assets and off-balance-sheet unused credit line that are not applied below two approaches* 

*•* *Simplified approach: for receivables, contract assets and lease receivables* 

*•* *Credit-impaired approach: for purchased or originated credit-impaired financial assets* 

Different measurement approaches are applied depending on significant increase in credit risk. 12 month expected credit losses is recognized when credit risk has not significantly increased since initial recognition. A loss allowance at an amount equal to lifetime expected credit losses is recognized when credit risk has significantly increased since initial recognition. Lifetime is presumed to be a period to the contractual maturity date of a financial asset (the expected life of the financial asset).

The Company determines whether the credit risk has increased significantly since initial recognition using the following information. One or more of the following items is deemed significant increase in credit risk.

*•* *More than 30 days past due;* 

*•* *Decline in credit rating at period end by more than certain notches as compared to that at initial recognition;* 

*•* *Decline in ratings below certain level in the early warning system;* 

Under simplified approach, the Company shall always measure the loss allowance at an amount equal to lifetime expected credit losses. Under credit-impaired approach, the Company shall only recognize the cumulative changes in lifetime expected credit losses since initial recognition as a loss allowance for purchased or originated credit-impaired financial assets.

The Company generally deems one or more of the following items credit-impaired:

*•* *90 days or more past due;* 

*•* *Legal proceedings related to collection;* 

*•* *Refinancing;* 

*•* *Corporate borrowers that are rated C or D;* 

*•* *Debt restructuring.* 

2.5.3.1 Forward-looking information

The Company uses forward-looking information, when it determines whether the credit risk has increased significantly since initial recognition and measures expected credit losses.

The Company assumes the risk component has a certain correlation with the business cycle, and calculates the expected credit loss by reflecting the forward-looking information with macroeconomic variables on the measurement inputs.

Forward-looking information used in calculation of expected credit loss is derived after comprehensive consideration of a variety of factors including scenario in management planning, risk situation scenario for stress test, third party forecast, and others.

2.5.3.2 Measuring expected credit losses on financial assets at amortised cost

The amount of the loss on financial assets at amortised cost is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows discounted at the financial asset's original effective interest rate. The Company estimates expected future cash flows for financial assets that are individually significant (individual assessment of impairment).

For financial assets that are not individually significant, the Company collectively estimates expected credit loss by grouping loans with homogeneous credit risk profile (collective assessment of impairment).

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

• Individual assessment of impairment

Individual assessment of impairment losses are calculated using management's best estimate on present value of expected future cash flows. The Company uses all the available information including operating cash flow of the borrower and net realizable value of any collateral held.

• Collective assessment of impairment

Collective assessment of loss allowance involves historical loss experience along with incorporation of forward-looking information. Such process incorporates factors such as type of collateral, product and borrowers, credit rating, size of portfolio and recovery period and applies 'probability of default' (PD) on a company of assets and 'loss given default' (LGD) by type of recovery method. Also, the expected credit loss model involves certain assumption to determine input based on loss experience and forward-looking information. These models and assumptions are periodically reviewed to reduce gap between loss estimate and actual loss experience.

2.5.3.3 Measuring expected credit losses on financial assets at fair value through other comprehensive income

Measuring method of expected credit losses on financial assets at fair value through other comprehensive income is equal to the method of financial assets at amortised cost, except for loss allowances that are recognized as other comprehensive income. Amounts recognized in other comprehensive income for sale or repayment of financial assets at fair value through other comprehensive income are reclassified to profit or loss.

2.5.4 Recognition and Derecognition

Regular way purchases and sales of financial assets are recognized or derecognized on trade-date, the date on which the Company commits to purchase or sell the asset. Financial assets are derecognized when the rights to receive cash flows from the financial assets have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.

If a transfer does not result in derecognition because the Company has retained substantially all the risks and rewards of ownership of the transferred asset, the Company continues to recognize the transferred asset in its entirety and recognizes a financial liability for the consideration received. The Company classified the financial liability as "borrowings" in the statement of financial position.

The Company writes off the carrying amount and allowance of financial assets in its entirety or to a portion thereof when the principal and interest are determined to be no longer recoverable. In general, the Company considers write-off when it is determined that the debtor does not have sufficient resources or income to cover the principal and interest, and this write-off decision is made in accordance with internal regulations.

2.5.5 Offsetting of financial instruments

Financial assets and liabilities are offset and the net amount reported in the statements of financial position where there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the assets and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Company or the counterparty.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.6 Financial Liabilities** 

2.6.1 Classification and Measurement

The Company's financial liabilities at fair value through profit or loss are financial instruments held for trading. A financial liability is held for trading if it is incurred principally for the purpose of repurchasing in the near term. A derivative that is not a designated as hedging instruments and an embedded derivative that is separated are also classified as held for trading.

The Company classifies non-derivative financial liabilities, except for financial liabilities at fair value through profit or loss, financial guarantee contracts and financial liabilities that arise when a transfer of financial assets does not qualify for derecognition, as financial liabilities carried at amortised cost and present as 'deposits liabilities', 'borrowings', and 'other financial liabilities' in the statement of financial position.

2.6.2 Derecognition

Financial liabilities are removed from the statement of financial position when it is extinguished; for example, when the obligation specified in the contract is discharged or canceled or expired or when the terms of an existing financial liability are substantially modified. The difference between the carrying amount of a financial liability extinguished or transferred to another party and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.

The Company's financial liabilities at fair value through profit or loss are financial instruments held for trading. A financial liability is held for trading if it is incurred principally for the purpose of repurchasing in the near term. A derivative that is not a designated as hedging instruments and an embedded derivative that is separated are also classified as held for trading. Financial liabilities designated the financial liabilities at fair value through profit or loss is the structured financial liabilities contain of embedded derivatives issued by the Company.

The changes in fair value of financial liabilities at FVTPL due to the change of credit risk is recognized as other comprehensive income(instead of profit and loss) and this other comprehensive income can not be transferred to profit and loss in subsequent events.

**2.7 Derivative Financial Instruments** 

The Company enters into numerous derivative financial instrument contracts such as stock options, stock swaps, interest rate swaps and others for trading purposes or sale and issue of derivative combined securities. These derivative financial instruments are presented as derivative financial instruments within the financial statements irrespective of transaction purpose and subsequent measurement requirement.

Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. The changes of the fair value of derivatives financial instruments held for trading are recognized in profit or loss as 'gain or loss on valuation and disposal of financial instrument'.

Fair value of derivative instrument traded in active market is a quoted price. In case of fair value of relatively simple derivative instruments such as options, interest rate or currency swaps and others is calculated using one or more valuation techniques like cash flow discount model, option pricing model which is based on observable data and appropriate considering the nature of objects.

Also, fair value of more complex derivative instrument is calculated using valuation techniques based on unobservable data in market is periodically reviewed and approved its accuracy.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

2.7.1 Day 1 Profit and Loss

Accordance with Korean IFRS, if there is no available price from active market and if the Company uses a valuation technique that uses data using unobservable valuation parameters from market for the fair value at initial recognition of financial instruments, there could be a difference between the transaction price and the amount determined using that valuation technique. In these circumstances, the fair value of financial instruments is recognized as the transaction price and the difference is amortised by using the straight line method over the life of the financial instruments.

2.7.2 Credit risk adjustments

In case of exchange-traded derivative instrument, credit risk is not reflected on the fair value because exchange-traded derivative instrument is traded in public exchange, and it is not available to identify certain counterparties. Fair value of OTC derivative instrument only reflects credit risk.

2.7.3 Hedge accounting

The accounting treatment of changes of fair value for the derivatives are varied as the character of hedging items and the purpose of hedging. The Company holds derivative contracts for the purpose of hedging the risk and the Company designates certain derivatives as hedging instruments to hedge the risk as follows.

*(a)* *Fair value hedge : a hedge of the exposure to changes in fair value of a recognized asset or liability or an unrecognized firm commitment* 

*(b)* *Cash flow hedge : a hedge of the exposure to variability in cash flows that is attributable to a particular risk associated with all, or a component of, a recognized asset or liability or a highly probable forecast transaction* 

*(c)* *Hedge of net investments in foreign operations* 

On initial designation of the hedge, the Company formally documents the relationship between the hedging instrument(s) and hedged items, including the risk management objectives and strategy in undertaking the hedge transaction, together with the methods that will be used to assess the effectiveness of the hedging relationship.

The fair value of derivatives for hedge is disclosed in note 37.

Changes in the fair value of a derivative hedging instrument designated as a fair value hedge are recognized in profit or loss. The gain or loss from remeasuring the hedging instrument at fair value for a derivative hedging instrument and the gain or loss on the hedged item attributable to the hedged risk are recognized in profit or loss

If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item is fully amortised to profit or loss by the maturity of the financial instrument using the effective interest method.

The accounting treatments of hedge of net investments in foreign operations are similar to the one of cash flow hedge.

If hedging instruments qualify for a hedge of net investments in foreign operations, the effective portion of changes in fair value of hedging instrument is recognized in other comprehensive income or loss and the ineffective portion is recognized in profit or loss. The gain or loss on the hedging instrument relating to the effective portion of the hedge that has been recognized in other comprehensive income will be reclassified from other comprehensive income or loss to profit or loss as a reclassification adjustment on the disposal or partial disposal of the foreign operation.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.8 Property and Equipment** 

All property and equipment except for land are recognized at its cost less any accumulated depreciation and any accumulated impairment losses. The cost of property and equipment includes any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management and the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

Land is measured at fair value on the basis of the valuation performed by an independent valuer. Revaluations are made with sufficient regularity to ensure that the carrying amount does not differ materially from that which would be determined using fair value at the end of the reporting period.

If an asset's carrying amount is increased as a result of a revaluation, the increase is recognized in other comprehensive income and the amount net of deferred tax is accumulated in equity under the heading of revaluation surplus after netting deferred tax. However, the increase is recognized in profit or loss to the extent that it reverses a revaluation decrease of the same asset previously recognized in profit or loss. If an asset's carrying amount is decreased as a result of a revaluation, the decrease is recognized in profit or loss. However, the decrease is recognized in other comprehensive income to the extent of any credit balance existing in the revaluation surplus in respect of that asset. The decrease recognized in other comprehensive income reduces the amount accumulated in equity under the heading of revaluation surplus. The revaluation surplus included in equity in respect of an item of property and equipment is transferred directly to retained earnings when the asset is derecognized.

Depreciation of all property and equipment, except for land, is calculated using the following method to allocate their cost or revalued amounts, net of their residual values, over their estimated useful lives as follows:

---

| | | |
|:---|:---|:---|
| **Property and equipment** | **Estimated useful lives** | **Depreciation method** |
| Buildings | 40 years | Straight-line method |
| Vehicles | 4 years | Straight-line method |
| Furniture and equipment | 4 years | Straight-line method |
| Other | 4 years | Straight-line method |
| Right-of-use assets | 1~10<br> years (initial date of the contract<br>entered into ~ maturity date) | Straight-line method |

---

The residual value, the useful life and the depreciation method applied to an asset are reviewed at least at each financial year-end and, if needed, the changes are accounted for as a change in an accounting estimate.

**2.9 Investment Property** 

Property held to earn rentals or for capital appreciation or both is classified as investment property. Investment property is measured initially at its cost. After recognition as an asset, investment property is carried at cost less accumulated depreciation and impairment losses. Investment property, except for land, is depreciated using the straight-line method over their useful lives of 40 years.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.10 Intangible Assets** 

Intangible assets are measured initially at cost and subsequently carried at their cost less any accumulated amortization and any accumulated impairment losses.

Intangible assets, except for goodwill, comprise software and membership rights, and are amortised using the straight-line method with no residual value over following estimated useful economic life since the asset is available for use. However, goodwill and membership rights are not amortised by considering their useful life as indefinite, because there is no expectable limit to period for use.

---

| | | |
|:---|:---|:---|
| **Intangible assets** | **Estimated useful lives** | **Amortization method** |
| Development costs | 4 years | Straight-line method |
| Software | 4 years | Straight-line method |

---

The amortization period and the amortization method for intangible assets with a finite useful life are reviewed at the end of each financial year. The management reviews the useful life of intangible assets that is not being amortised each period to determine whether events and circumstances continue to support an indefinite useful life. If management judges that previous estimates should be adjusted, the change is accounted for as a change in an accounting estimate.

**2.11 Impairment of Non-financial Assets** 

Goodwill or intangible assets with indefinite useful lives are not subject to amortization and are tested annually for impairment. Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. Non-financial assets, other than goodwill, that suffered impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

**2.12 Lease** 

Lease income from operating leases where the Company is a lessor is recognized in income on a straight-line basis over the lease term. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying asset and recognized as expense over the lease term on the same basis as lease income. The respective leased assets are included in the statement of financial position based on their nature.

The Company should assess whether a contract is, or contains a lease at the date of the contract entered into and the initial application date under Korean IFRS No.1116. But the Company may elect not to reassess whether a contract is, or contains a lease for the contract entered into before the transition date by applying practical expedient permitted by Korean IFRS No.1116. The Company has gone through all the contract to assess whether the contract is, or contains, a lease at the contract entered into after the date of initial application.

A lessee is required to recognize a right-of-use assets (lease assets) representing its right to use the underlying leased asset and a lease liability representing its obligation to make lease payments. Assets and liabilities arising from a lease are initially measured on a present value basis.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Lease liabilities include the net present value of the following lease payments:

*•* *Fixed payments (including in-substance fixed payments), less any lease incentives receivable* 

*•* *Variable lease payment that are based on an index or a rate* 

*•* *Amounts expected to be payable by the lessee under residual value guarantees* 

*•* *The exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and* 

*•* *Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease* 

The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the lessee's incremental borrowing rate is used, being the rate that the lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms and conditions.

Right-of-use assets are measured at cost comprising the following:

*•* *The amount of the initial measurement of lease liability* 

*•* *Any lease payments made at or before the commencement date less any lease incentives received* 

*•* *Any initial direct costs incurred by the lessee, and* 

*•* *An estimate of restoration costs* 

However, short-term lease (lease that, at the commencement date, has a lease term of 12 months or less) and lease of low-value assets (For example, underlying leased asset under $5,000) are permitted to elect exceptional conditions.

The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term.

Related to sale and leaseback, the Company (seller-lessee) is required to applying the Korean IFRS No.1115 '*Revenue from Contracts with Customers*' to determine whether the transfer of an asset is accounted for as a sale of that asset. However, the Company shall not reassess sale and leaseback transactions entered into before the date of initial application.

Large number of lease contracts held by the Company have extension option and termination option. These conditions are generally used for the maximizing the flexibility of lease operation in a view of managing the contracts. Extension option or termination option included in the lease contracts are generally owned by the Company, not lessor. The Company re-evaluated the lease term of the lease contracts by taking into account the contract type, operation plan for branch offices, and costs related to lease termination. As a result, no significant change in the existing lease term has occurred.

**2.13 Provisions** 

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation and the increase in the provision due to passage of time is recognized as interest expense.

**2.14 Financial Guarantee Contracts** 

Financial guarantees contracts provided by the Company are initially measured at fair value on the date the guarantee was given. Subsequent to initial recognition, the Company's liabilities under such guarantees are measured at the higher of the amounts below and recognized as 'other financial liabilities':

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Loss allowance in accordance with Korean IFRS No.1109, ' *Financial Instruments'* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The amount initially recognized less, when appropriate, the cumulative amount of income recognized in accordance
with the principles of Korean IFRS No.1115, ' *Revenue from Contracts with Customers* '

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.15 Revenue Recognition** 

The Company recognizes revenues in accordance with the following five-step revenue recognition standard (Korean IFRS No.1115 *Revenue from Contracts with Customers*).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 1: Identify the contract with a customer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 2: Identify the performance obligations in the contract.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 3: Determine the transaction price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 4: Allocate the transaction price to the performance obligations in the contract.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

**2.16 Employee Benefits** 

2.16.1 Retirement benefit liabilities: Defined benefit plans and Defined contribution plans

The Company has both defined benefit and defined contribution plans. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. The contributions are recognized as employee benefit expenses when an employee has rendered service. A defined benefit plan is a pension plan that is not a defined contribution plan.

Typically defined benefit plans define an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation. The liability recognized in the statement of financial position in respect of defined benefit pension plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds and that have terms to maturity approximating to the terms of the related pension obligation. The remeasurements of the net defined benefit liability are recognized in other comprehensive income.

If any plan amendments, curtailments, or settlements occur, past service costs or any gains or losses on settlement are recognized as profit or loss for the year.

2.16.2 Short-term employee benefits

Short-term employee benefits, which are expected to be settled wholly before 12 months after the end of the annual reporting period in which the employees render the service, are recognized in profit or loss at the undiscounted amount of short-term employee benefits expected to be paid in exchange for that service.

The expected cost of profit-sharing and bonus payments are recognized as liabilities when the Company has a present legal or constructive obligation to make such payments as a result of past events rendered by employees and a reliable estimate of the obligation can be made.

2.16.3 Share-based payment

The Company is under share-based payment arrangements that grant shares to the executives of the Company. When the arrangements are exercised, the Company provides share or cash equal to the monetary value of the share.

The Company measures the services acquired and the liability incurred at fair value, and the fair value is recognized as expense and accrued expenses over the vesting period. Until the liability is settled, the Company remeasures the fair value of the liability at the end of each reporting period and at the date of settlement, with any changes in fair value recognized in profit or loss as share-based payments.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**2.17 Income Tax Expenses** 

Income tax expense comprises current income tax and deferred income tax and are recognized in profit or loss for the year, except to the extent that the tax arises from (a) a transaction or event which is recognized either in other comprehensive income or directly in equity and (b) a business combination.

2.17.1 Current income tax

Current income tax is the amount of income taxes payable (recoverable) in respect of the taxable profit (tax loss) for a period. A difference between the taxable profit and accounting profit may arise when income or expense is included in accounting profit in one period but is included in taxable profit in a different period. Differences may also arise if there is revenue that is exempt from taxation or expenses that is not deductible in determining taxable profit (tax loss). Current income tax liabilities (assets) for the current and prior periods are measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

The Company offsets current income tax assets and current income tax liabilities if, and only if, the Company (a) has a legally enforceable right to set off the recognized amounts and (b) intends to settle on a net basis.

2.17.2 Deferred income tax

Deferred income tax is recognized, using the asset-liability method, on temporary differences arising between the tax based of assets and liabilities and their carrying amount in the financial statements. Deferred income tax liabilities are recognized for all taxable temporary differences and deferred income tax assets are recognized for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilized. However, deferred income tax liabilities are not recognized if they arise from the initial recognition of goodwill; deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit or loss.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except for deferred income tax liability where the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference, will not reverse in the foreseeable future.

The carrying amount of a deferred income tax asset is reviewed at the end of each reporting period. The Company reduces the carrying amount of a deferred income tax asset to the extent that it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred income tax asset to be utilized.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred income tax liabilities and deferred income tax assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

Current income tax and deferred income tax are included in the calculation of income tax expense. Income taxes related to prior period are included in current income tax.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Deferred income taxes, recognized directly in equity or arisen from business combination, are directly deducted from equity or goodwill.

**2.18 Operating Segment Reporting** 

Operating segments are components of the Company, about which separate internal reporting information is evaluated regularly by the chief operating decision makers including board of directors in deciding how to allocate resources and to assess performance. Each segment is a strategic business unit that offers different products and services, and is managed separately because each business has different risks and opportunities, different technology required and marketing strategies.

Segment information includes the items which are directly attributable and reasonably allocated to the segment.

**2.19 Other Receivables and Payables Related to Brokerage Transactions** 

Regarding customer brokerage transactions, the Company recognizes the receivable from and payable to the Korea Exchange (Clearing and settlement organization) and customers in total amounts, which the Company recognizes as other financial assets and other financial liabilities. The Company offsets the receivable and payable that arise between Korea Exchange and the Company within the same day, and that arise between a customer and the Company within the same day and through the same account.

**2.20 Business Combinations** 

The acquisition method of accounting is used to account for business combinations by the Company. The consideration transferred is measured at the fair values of the assets transferred, and identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.

The Company applies the book-value method to account for business combinations of entities under a common control. Identifiable assets acquired and liabilities assumed in a business combination are measured at their book values on the financial statements of the ultimate parent entity. In addition, the difference between the sum of book values of the assets and liabilities transferred and accumulated other comprehensive income; and the consideration paid is recognized as capital surplus.

**2.21 Approval of Issuance of the Financial Statements** 

The issuance of the December 31, 2022 separate financial statements of the Company was approved by the Board of Directors on March 6, 2023, which is subject to change with approval at the annual shareholder's meeting.

**3. Critical Accounting Estimates and Assumptions** 

The preparation of financial statements requires the Company to make estimates and assumptions concerning the future. Management also needs to exercise judgement in applying the Company's accounting policies. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. As the resulting accounting estimates will, by definition, seldom equal the related actual results, it can contain a significant risk of causing a material adjustment.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below. Additional information of significant judgment and assumptions of certain items are included in relevant notes.

**3.1 Income taxes** 

The Company recorded, based on its best estimate, current taxes and deferred taxes that the Company will be liable in the future for the operating results at the end of the reporting period. However, the final tax outcome in the future may be different from the amounts that were initially recorded. Such differences will impact the current and deferred income tax assets and liabilities in the period in which such determination is made.

If certain portion of the taxable income is not used for investments or increase in wages in accordance with the Special Taxation for Facilitation of Investment and Mutually-Beneficial Cooperation, the Company is liable to pay additional income tax calculated based on the tax law. Accordingly, the measurement of current and deferred income tax is affected by the tax effects from the tax law. As the Company's income tax is dependent on the investments and increase in wages, there exists uncertainty with regard to measuring the final tax effects.

**3.2 Fair value of financial instruments** 

The fair value of financial instruments where no active market exists or where quoted prices are not otherwise available is determined by using valuation techniques. Financial instruments, which are not actively traded in the market and those with less transparent market prices, will have less objective fair values and require broad judgment on liquidity, concentration, uncertainty in market factors and assumptions in price determination and other risks.

As described in Note 2.5, 'Recognition and Measurement of Financial Instruments', diverse valuation techniques are used to determine the fair value of financial instruments, from generally accepted market valuation models to internally developed valuation models that incorporate various types of assumptions and variables.

**3.3 Impairment of financial assets** 

In accordance with Korean IFRS No.1109, the provision for impairment for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation based on the Company's past history, existing market conditions as well as forward-looking estimates at the end of each reporting period (Note 2.5).

**3.4 Measurement of defined benefit obligation** 

The present value of the defined benefit liability depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost (income) for pensions include the discount rate. Any changes in these assumptions will impact the carrying amount of the defined benefit liability. The Company determines the appropriate discount rate at the end of the reporting period. This is the interest rate that is used to determine the present value of estimated future cash outflows expected to be required to settle the defined benefit liability. In determining the appropriate discount rate, the Company considers the interest rates of high-quality corporate bonds that are denominated in the currency in which the pension benefits will be paid, and that have terms to maturity approximating to the terms of the related pension liability. Other key assumptions for defined benefit liability are based in part on current market conditions.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**4. Segment Information** 

4.1 Types of services from which each reportable segment derives its revenues

Management of the Company decides operating segment based on the information, which is to be reported to the chief executive officer, in order to allocate resources to the segment and evaluate performance of the segment. The Company's operating segments consist of brokerage and wealth management, investment banking, trading and other business part.

In accordance with Korean IFRS No.1108, reporting segments of the Company by type of services categories are as follows:

---

| | |
|:---|:---|
| **Reporting segment** | **Main business activities** |
| Brokerage and wealth management | Sales and services relating to wealth management and brokerage provided to individuals, corporations and institutional investors |
| Investment banking | Underwriting and advisory services related to bond issuance, structured finance, initial public offering, and mergers and acquisition |
| Trading | Trading of securities and derivatives, and proprietary trading |
| Others | Other services and support services |

---

4.2 Revenue and income of segment reporting

Financial information by operating segment for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* |
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Operating**<br> **income** | **Operating**<br> **expense** | **Operating**<br> **profit (loss)** | **Non-operating**<br> **income (expense)** | **Income tax<br>expense** | **Profit (loss)**<br> **for the year** |
|  Brokerage and wealth management | 2319349482 | 2179648293 | 139701189 | (19620828) |  | 120080361 |
|  Investment banking | 867151810 | 746582110 | 120569700 | 68589313 |  | 189159013 |
|  Trading | 10622124083 | 10740421352 | (118297269) | 1375474 |  | (116921795) |
|  Others <sup>1</sup> | 168186307 | 93363333 | 74822974 | (36598074) | 60247522 | (22022622) |
|  | 13976811682 | 13760015088 | 216796594 | 13745885 | 60247522 | 170294957 |
|  <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. | <br> <sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation. |
| *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* | *(in thousands of Korean won)* |
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Operating**<br> **income** | **Operating**<br> **expense** | **Operating**<br> **profit** | **Non-operating**<br> **income (expense)** | **Income tax<br>expense** | **Profit (loss)**<br> **for the year** |
|  Brokerage and wealth management | 1832603380 | 1484199891 | 348403489 | (4106356) |  | 344297133 |
|  Investment banking | 602707271 | 349138340 | 253568931 | 36865936 |  | 290434867 |
|  Trading | 5761831766 | 5667551744 | 94280022 | (6190171) |  | 88089851 |
|  Others <sup>1</sup> | 163781930 | 53546564 | 110235366 | (20852221) | 214559285 | (125176140) |
|  | 8360924347 | 7554436539 | 806487808 | 5717188 | 214559285 | 597645711 |

---

<sup>1</sup> All income tax expenses are allocated to the others segment, due to the difficulty of reasonable allocation.

The above reported operating income is generated from external customers and inter-segment transactions, and expense includes expenses that can be directly attributed or reasonably allocated to each segment including internal interests. Segment profit represents the profit earned by each segment, reported to the chief executive officer to determine the allocation of resources and to measure the respective segments' performance.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

4.3 Assets and liabilities of segments

Total assets and liabilities by each segment as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** |
|  | **Total assets** | **Total liabilities** |
|  Brokerage and wealth management | 7398410715 | 6428705688 |
|  Investment banking | 3135300826 | 86637307 |
|  Trading | 23836270897 | 18743394623 |
|  Others | 16280732206 | 19576438492 |
|  | 50650714644 | 44835176110 |

---

---

| | | |
|:---|:---|:---|
| (in thousands of Korean won) | **2021** | **2021** |
|  | **Total assets** | **Total liabilities** |
|  Brokerage and wealth management | 6889059433 | 8300664510 |
|  Investment banking | 2772519734 | 119618507 |
|  Trading | 28394521203 | 20226698063 |
|  Others | 14513937963 | 18474903134 |
|  | 52570038333 | 47121884214 |

---

4.4 Information on principal customers

No single customer contributed 10% or more to the Company's revenue for the years ended December 31, 2022 and 2021.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**5. Cash and Deposits** 

The details of cash and deposits as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Cash and cash equivalents** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash on hand | 14096 | 105 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Demand deposits | 658388425 | 80331797 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Checking deposit | 12051431 | 2000976 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign currency deposits | 268540580 | 325866088 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MMDA | 84127974 | 4393381 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accommodation notes | 4747856 | 1555452 |
|  | 1027870362 | 414147799 |
|  **Deposits** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits for securities subscription | 1007522 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reserve for claims of customers' deposits | 456165726 | 351745802 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantee deposits for securities lending and borrowing | 120336120 | 95528832 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits for exchange-traded derivatives | 1079340866 | 779299475 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantee deposits for KSFC trading | 2513154 | 2114517 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Long-term deposits | 575000000 | 1073550000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Restricted due from financial institutes | 39000 | 39000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 766660854 | 629326773 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Allowances for credit losses of deposits | (645197) | (632598) |
|  | 3000418045 | 2930971801 |
|  | 4028288407 | 3345119600 |

---

Restricted deposits as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Deposits for securities subscription <sup>1</sup> | 1007522 |  |
|  Reserve for claims of customers' deposits <sup>2</sup> | 456165726 | 351745802 |
|  Guarantee deposits for securities lending and borrowing <sup>3</sup> | 120336120 | 95528832 |
|  Deposits for exchange-traded derivatives <sup>4</sup> | 1079340866 | 779299475 |
|  Guarantee deposits for KSFC trading <sup>5</sup> | 2513154 | 2114517 |
|  Long-term deposits <sup>6</sup> | 569000000 | 769000000 |
|  Restricted due from financial institutes <sup>7</sup> | 39000 | 39000 |
|  Others <sup>8</sup> | 766660854 | 629326773 |
|  | 2995063242 | 2627054399 |

---

<sup>1</sup> Subscription deposits are subscription margin of investors and the Company that are separately deposited at Korea Securities Finance Corporation(KSFC) or other relevant financial institutions until due date for payment for the subscription of the newly issued or sold securities in accordance with the provisions of Article 4-44 of the Regulation on Financial Investment Business. 

<sup>2</sup> The reserve for claims of customers' deposits is deposited separately in a form of trust in KSFC to meet the demands of investors, such as return of deposit and others, in accordance with Article 74 of the Financial Investment Services and Capital Markets Act.

<sup>3</sup> Deposited in Korea Securities Depository to guarantee for securities lending and borrowing.

<sup>4</sup> The deposits for exchange-traded derivatives that the investors and the Company pay for foreign futures option trading to KEB Hana Bank and Forex Dealer Member.

<sup>5</sup> In the case of an investor's loan transaction, a certain portion of the price of securities sold is deposited at KSFC as margin.

<sup>6</sup> Pledged deposits provided for securities lending and borrowing, repurchase agreements between institutions and retail payment through investment & securities companies are included.

<sup>7</sup> Guarantee deposits for checking accounts

<sup>8</sup> Deposits in foreign currency and others consist of the margin accounts for trading financial instruments in foreign markets and deposits to court.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Changes in allowances for credit losses of deposits for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** |
|  | **12-month<br>expected<br>credit losses** | **12-month<br>expected<br>credit losses** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
|  | **12-month<br>expected<br>credit losses** | **12-month<br>expected<br>credit losses** | **Non-Impaired** | **Impaired** |
|  Beginning |  | 632598 |  |  |
|  Provision |  | 12599 |  |  |
|  |  | 645197 |  |  |

---

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** |
|  | **12-month<br>expected<br>credit losses** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
|  | **12-month<br>expected<br>credit losses** | **Non-Impaired** | **Impaired** |
|  Beginning | 739545 |  |  |
|  Reversal of provision | (106947) |  |  |
|  | 632598 |  |  |

---

**6. Financial Instruments at FVTPL** 

The details of financial instruments at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Financial Assets at FVTPL** | **Financial Assets at FVTPL** | **Financial Liabilities at FVTPL** | **Financial Liabilities at FVTPL** |
|  | **2022** | **2021** | **2022** | **2021** |
|  Financial assets required to be mandatorily measured at FVTPL | 28995718418 | 33833764376 | 2082979265 | 2825922918 |
|  Financial assets designated at FVTPL |  |  | 10088600213 | 9160923652 |
|  | 28995718418 | 33833764376 | 12171579478 | 11986846570 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

6.1 Financial assets required to be mandatorily measured at FVTPL

The details of financial assets required to be mandatorily measured at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Deposits** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reserve for claims of customers' deposits (trust) <sup>1</sup> | 4531756553 | 5704580963 |
|  **Equity instruments** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks | 604033526 | 486724148 |
|  **Debt instruments** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and local government bonds | 4092627487 | 5292775017 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Special bonds | 1793814905 | 2498873337 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds | 4093880890 | 8318369010 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate commercial papers | 5196584584 | 4170294875 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Asset-backed short-term bonds | 2406246303 | 1490591859 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hybrid bond with security-like features | 220498019 | 110295800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment in partnerships | 440156234 | 334361963 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Collective investment securities | 3311063660 | 2732256417 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hybrid stock with bond-like features | 120388757 | 107562502 |
|  **Loans** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Privately placed bonds | 42604988 | 173459362 |
|  **Derivative linked securities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity-linked securities | 31899039 | 41493507 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other derivative linked securities | 331528412 | 139326096 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other OTC derivative combined contract | 236574425 | 114887470 |
|  **Securities in foreign currency** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks in foreign currency | 26990295 | 1552014 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bonds in foreign currency | 621320119 | 1245665576 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in partnerships in foreign currency | 43983023 | 25840354 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Collective investment securities in foreign currency | 208724857 | 242647445 |
|  **Collective fund for default loss** | 82667524 | 73273475 |
|  **Hybrid bonds** | 558301229 | 528403259 |
|  **Exchange traded notes** | 73589 | 529927 |
|  | 28995718418 | 33833764376 |

---

<sup>1</sup> The reserve for claims of customers' deposits is restricted to use because this reserve is deposited separately in a form of trust in KSFC to meet the demands of investors, such as return of deposit and others, in accordance with Article 74 of the Financial Investment Services and Capital Markets Act. Among the reserve for claims of customers' deposits deposited in a form of trust in KSFC, beneficiaries amount to \ 98,000 million are provided as a collateral for the payment to Kookmin Bank which is an agent bank of payment, in accordance with Article 72 Clause 3 of the Financial Investment Services and Capital Markets Act. 

Details of securities sold which are classified as financial liabilities at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Equity Securities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks | 428935822 | 509897766 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Collective investment securities | 2268236 | 3056061 |
|  Debt Securities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and local government bonds | 1651775207 | 2282891241 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Special bonds |  | 30077850 |
|  | 2082979265 | 2825922918 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Assets Pledged as Collateral

The details of financial assets pledged as collateral as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of* <br>*Korean won)* | **Description** | **2022** | **2021** | **Security right holder** |
|  Financial assets at FVTPL | Guarantee deposits for lending and borrowing securities and bonds | 7063541100 | 9294924447 | Korea Securities Depository, etc. |
|  | Margin required and guarantee deposits for derivatives trading | 1129757669 | 955030966 | Korea Stock Exchange, etc. |
|  | Guarantee deposits for clearing fund | 1458725 | 1653330 | Korea Securities Depository |
|  | Guarantee deposits for reverse repurchase agreements | 3724891983 | 8422134434 | Customer, Institution |
|  Financial assets at FVOCI | Guarantee deposits for lending and borrowing securities and bond | 1592460037 | 1523592569 | Korea Securities Depository, etc. |
|  | Guarantee deposits for derivatives trading | 136701325 |  | Hana Securities Co., Ltd., etc. |
|  | Guarantee deposits for reverse repurchase agreements | 2234882535 | 1990336464 | Customer, Institution |
|  Other financial assets | Guarantee deposits for lending and borrowing securities and bonds | 47850000 |  | KSFC |
|  |  | 15931543374 | 22187672210 |  |

---

(\*) As at December 31, 2022 and 2021, the accrued interests related to debt securities provided as collateral of W 228,578 million and W 279,423 million, respectively, are excluded.

The Company provides W 4,986,339 million and W 6,165,555 million of its borrowing securities held as collateral to KSFC and others as at December 31, 2022 and 2021, respectively.

As at December 31, 2022 and 2021, the fair values of collaterals sold or repledged as collaterals regardless of default are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Securities** | **Securities** | **Securities** | **Securities** |
|  | **2022** | **2022** | **2021** | **2021** |
|  Fair value of collateral held |  | 771983450 |  | 488172002 |
|  Fair value of collaterals sold or re-provided as collateral |  |  |  |  |
|  |  | 771983450 |  | 488172002 |

---

6.2 Financial liabilities designated at FVTPL

The details of financial liabilities designated at FVTPL as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| (in thousands of Korean won) | **Financial liabilities designated at FVTPL** | **Financial liabilities designated at FVTPL** |
|  | **2022** | **2021** |
|  **Derivative linked securities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity-linked securities | 6804836388 | 6252543366 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other derivative linked securities | 1636774811 | 1972278390 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other OTC derivative combined contract | 1611301701 | 899164069 |
|  **Exchange traded notes** | 35687313 | 36937827 |
|  | 10088600213 | 9160923652 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The differences between the contractual value to be paid at maturity and the carrying amount of financial liabilities at FVTPL as at December 31, 2022 and 2021, are as follows :

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Contractual value to be paid at maturity | 9973339575 | 8957601834 |
|  Carrying amount | 10088600213 | 9160923652 |
|  Differences | (115260638) | (203321818) |

---

Accumulated changes in fair value of financial liabilities at FVTPL due to the change of credit risk as at December 31, 2022 and 2021, are as follows :

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **Other comprehensive income recognized<br>from changes of fair value due to the change<br>of credit risk (before tax) <sup>1</sup>** | **Other comprehensive income recognized<br>from changes of fair value due to the change<br>of credit risk (before tax) <sup>1</sup>** |
|  | **2022** | **2021** |
|  Beginning of the year | (3070045) | 15846655 |
|  Change of fair value | (52822291) | (18916700) |
|  End of the year | (55892336) | (3070045) |

---

<sup>1</sup> The Company assessed OCI based on the probability of default corresponding to the Company's credit rating and loss given default. The amount is before tax. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**7. Derivatives and Hedge Accounting** 

Derivatives owned by the Company as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Assets** | **Assets** | **Liabilities** | **Liabilities** | |
| *(in thousands of Korean won)* | **Hedging** | **Trading** | **Hedging** | **Trading** | **Unsettled amount** |
|  **Exchange-traded derivatives** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 577939 |  | 256477 | 2310773337 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 35187795 |  | 89623607 | 1805532521 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase options |  | 58416888 |  |  | 1642156435 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written options |  |  |  | 330682246 | 2408934407 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 36107 |  | 1116502 | 272274527 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goods: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 1969714 |  | 940729 | 28576813 |
|  |  | 96188443 |  | 422619561 | 8468248040 |
|  **OTC derivatives** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 699505103 |  | 585959569 | 9274000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 103770321 |  | 263433622 | 139380656724 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 8032470 |  | 8906536 | 830000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 230688984 | 10070190 | 162136418 | 9184163903 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 10205826 |  | 11813068 | 464220055 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 21446632 |  | 438473 | 595631000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 377816741 |  | 492274693 | 6591918841 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase options |  | 107414599 |  |  | 1446151498 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written options |  |  |  | 28591489 | 1747432558 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Credit: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 32859630 |  | 17468307 | 3006113907 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goods: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 887437 |  | 885284 | 131500117 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 13153870 |  | 313466501 | 909001211 |
|  |  | 1605781613 | 10070190 | 1885373960 | 173560789814 |
|  |  | 1701970056 | 10070190 | 2307993521 | 182029037854 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Assets** | **Assets** | **Liabilities** | **Liabilities** | |
| *(in thousands of Korean won)* | **Hedging** | **Trading** | **Hedging** | **Trading** | **Unsettled amount** |
|  **Exchange-traded derivatives** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 1903458 |  | 2430952 | 4563014693 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 14338186 |  | 6147764 | 1585281541 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase options |  | 51905242 |  |  | 1412231541 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written options |  |  |  | 188099589 | 2423244090 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 339853 |  | 493846 | 309698291 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goods: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures |  | 42891 |  | 81769 | 6370216 |
|  |  | 68529630 |  | 197253920 | 10299840372 |
|  **OTC derivatives** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 125452803 |  | 136232672 | 3684000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 54554193 |  | 77612686 | 135992175725 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 5121493 |  | 4809190 | 1010000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 140701852 | 6068500 | 96914441 | 13270136916 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 8270011 |  | 7273776 | 368698598 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 2400866 |  |  | 165970000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 322864833 |  | 132618848 | 5119813277 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase options |  | 43280731 |  |  | 1748428964 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Written options |  |  |  | 53270931 | 2024447957 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Credit: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 18979327 |  | 7408651 | 2588958733 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 20859427 |  | 117235787 | 1601240180 |
|  |  | 742485536 | 6068500 | 633376982 | 167573870350 |
|  |  | 811015166 | 6068500 | 830630902 | 177873710722 |

---

The Company entered into the derivative contracts and applied fair value hedge accounting for hedging foreign exchange risk of the investment in subsidiaries and others.

Gain or loss on fair value hedge for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Gain(loss) on the hedging instrument | (17212706) | (6366340) |
|  Gain(loss) on the hedged item attributable to the hedged risk | 17212706 | 6366340 |

---

The average price condition for the nominal future cash flow related to hedge of net investments in foreign operations as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** |
|  | **The nominal amount of**<br> **the hedging instrument** | **The nominal amount of**<br> **the hedging instrument** | **Average price condition**<br> **(KRW/USD, Korean won)** | **Average price condition**<br> **(KRW/USD, Korean won)** |
|  1 year |  | 65012490 |  | 1071.00 |
|  2 year |  |  |  |  |
|  3 year |  |  |  |  |
|  Over 3 year |  | 204035300 |  | 1178.92 |
|  |  | 269047790 |  | 1152.84 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** | **2021** |
|  | **The nominal amount of**<br> **the hedging instrument** | **The nominal amount of**<br> **the hedging instrument** | **Average price condition**<br> **(KRW/USD, Korean won)** | **Average price condition**<br> **(KRW/USD, Korean won)** |
|  1 year |  | 62831500 |  | 1071.00 |
|  2 year |  |  |  |  |
|  3 year |  |  |  |  |
|  Over 3 year |  | 100767500 |  | 1172.73 |
|  |  | 163599000 |  | 1133.66 |

---

The contents of fair value hedge as of December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Carrying amount**<br> **(asset)** | **Carrying amount**<br> **(asset)** | **Accumulated fair<br>value (asset)** | **Accumulated fair<br>value (asset)** | **Change of fair value<br>for the year** | **Change of fair value<br>for the year** |
|  **Currency** |  |  |  |  |  |  |
|  Investment in subsidiaries |  | 303653815 |  | 24395046 |  | 17212706 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| (in thousands of Korean won) | **Carrying amount**<br> **(asset)** | **Carrying amount**<br> **(asset)** | **Accumulated fair**<br> **value (asset)** | **Accumulated fair**<br> **value (asset)** | **Change of fair value**<br> **for the year** | **Change of fair value**<br> **for the year** |
|  **Currency** |  |  |  |  |  |  |
|  Investment in subsidiaries |  | 286441109 |  | 7182340 |  | 6366340 |

---

**8. Financial Assets at FVOCI** 

The details of financial assets at FVOCI as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| (in thousands of Korean won) | **2022** | **2021** |
|  **Equity instruments** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks <sup>1</sup> | 420330275 | 365576095 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment in partnerships | 1200000 | 1200000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other | 264586560 | 78876642 |
|  **Debt instruments** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and local government bonds | 5025406 | 20989065 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Special bonds | 690761850 | 549741426 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds | 3194758700 | 2698701899 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt instruments in foreign currency | 222182668 | 123213103 |
|  | 4798845459 | 3838298230 |

---

<sup>1</sup> Equity investment on Korea Stock Exchange and other relative institutions.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Changes in gains and losses on valuation of financial assets at FVOCI (before tax) for the year ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Valuation<sup>1</sup>** | **Disposal /**<br> **transfer** | **Ending**<br> **balance** |
|  Stocks | 318760788 | 54754180 |  | 373514968 |
|  Government and local government bonds | 1768 | (194598) | (3010) | (195840) |
|  Special bonds | (3852333) | (746312) | 1944438 | (2654207) |
|  Corporate bonds | (14256566) | (15405862) | 6104383 | (23558045) |
|  Securities in foreign currency | (915931) | (5390112) | 141511 | (6164532) |
|  Securities in won currency | (1125111) | (21775311) |  | (22900422) |
|  | 298612615 | 11241985 | 8187322 | 318041922 |

---

<sup>1</sup> Provision for credit loss of debt instruments at FVOCI as W 2 million and reversal of provision for credit loss of debt instruments at FVOCI as W 477 million are excluded.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Valuation<sup>1</sup>** | **Disposal /**<br> **transfer** | **Ending**<br> **balance** |
|  Stocks | 278961566 | 39799222 |  | 318760788 |
|  Government and local government bonds | (44428) | 1768 | 44428 | 1768 |
|  Special bonds | 107785 | (3839248) | (120870) | (3852333) |
|  Corporate bonds | 3046331 | (16055846) | (1247051) | (14256566) |
|  Securities in foreign currency | 1609775 | (1083912) | (1441794) | (915931) |
|  Securities in won currency | 356906 | (1482017) |  | (1125111) |
|  | 284037935 | 17339967 | (2765287) | 298612615 |

---

<sup>1</sup> Provision for credit loss of debt instruments at FVOCI as W 598 million is excluded.

There are no equity investments at FVOCI derecognized for the year ended December 31, 2022.

The dividend income from equity investments at FVOCI for the years ended December 31, 2022 and 2021, are as follows;

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  | **Derecognised** | **Held at the<br>reporting<br>period** | **Derecognised** | **Held at the<br>reporting<br>period** |
|  **Equity investments at FVOCI** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non marketable securities |  | 9536521 |  | 7411793 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other equity investments |  | 8493303 |  | 2668697 |

---

The Company recognized provision for credit loss of debt instruments at FVOCI amount (before tax) to W 1,004 million and W 1,479 million, as at December 31, 2022 and 2021, respectively.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**9. Investments in Subsidiaries and Associates** 

Investments in subsidiaries and associates as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Location** | **Percent**<br> **age of<br>ownership(%)** | **Date of<br>financial<br>statements<sup>5</sup>** | **Net Asset** | **Book amount** | **Main**<br> **Business** |
|  **Subsidiaries** |  |  |  |  |  |  |
|  KBFG Securities America Inc. | USA | 100.00 | December | 18041916 | 17259715 | Investment, advisory |
|  KB Securities Hong Kong Ltd. | Hong<br>Kong | 100.00 | December | 239897905 | 232643725 | Investment, advisory |
|  KB Securities Vietnam Joint Stock Company | Vietnam | 99.81 | December | 213280342 | 173875579 | Investment, advisory |
|  KB FINA Joint Stock Company | Vietnam | 77.82 | December | 12565774 | 11146330 | IT(Fintech) |
|  PT. KB Valbury Sekuritas <sup>2</sup> | Indonesia | 65.00 | December | 74490022 | 57221997 | Investment, advisory |
|  KB Digital Innovation&growth New Technology Business Investment Fund<sup>1</sup> | Korea | 20.00 | December | 8973047 | 2000000 | Other financial |
|  KB Pre-IPO <sup>2nd</sup> (TCB) New Technology Business Investment Fund <sup>1</sup> | Korea | 42.86 | December | 29330303 | 15000000 | Other financial |
|  KB Global Contents Private Investment<br>Fund <sup>1, 2</sup> | Korea | 27.27 | December | 16206667 | 4500000 | Other financial |
|  JB New Jersey Private Real Estate Fund 1 | Korea | 98.15 | December | 16360410 | 1074621 | Funds |
|  LB Irealand Private Real Estate Investment Trust 8 | Korea | 96.64 | December | 66950154 | 66076000 | Funds |
|  Pacific US BlackRock Private Placement Real Estate Fund Investment Trust No. 15 | Korea | 98.51 | December | 20855322 | 21641016 | Funds |
|  DAOL KTB Aircraft Private Investment Trust No.21-1 | Korea | 99.61 | December | 29335226 | 27752839 | Funds |
|  Vestas General Private Real Estate Fund Investment Trust No. 38 | Korea | 54.92 | December | 195270855 | 104400551 | Funds |
|  Mangrove Feeder Fund | Cayman<br>Islands | 92.88 | December | 76046414 | 71010090 | Funds |
|  GH Real Estate I LP | Guernsey | 81.00 | December | 25963433 | 21030311 | Investment |
|  JB Dry Street Private Fund 1 | Korea | 100.00 | December | 558206 | 974200 | Funds |
|  JB Australia108 Private Fund 1 | Korea | 100.00 | December | 386743 | 697499 | Funds |
|  JB Forge Private Fund 1 | Korea | 100.00 | December | 276586 | 499062 | Funds |
|  JB Hall Street Private Fund 1 | Korea | 100.00 | December | 525576 | 933520 | Funds |
|  JB Margaret Street Private Fund 1 | Korea | 100.00 | December | 148801 | 264785 | Funds |
|  Hanwha US Equity Strategy Private Real Estate Fund 3 | Korea | 99.95 | December | 3227527 | 2784410 | Funds |
|  GVA Europe Pre-IPO Private Investment Trust No.1 <sup>2</sup> | Korea | 66.70 | December | 29960445 | 20000000 | Funds |
|  LIFE Global Reits Pre-IPO General Private Investment Trust 1 <sup>2</sup> | Korea | 99.50 | December | 59684316 | 59470000 | Funds |
|  KB KBSTAR US Short-Term IG Corporate Bond ETF <sup>2</sup> | Korea | 59.88 | December | 79716716 | 50000000 | Funds |
|  Able Gwonseon 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (70907) |  | Asset-backed securitization |
|  Paradise Yeongjong 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | (1259921) |  | Asset-backed securitization |
|  Newstar IP Co., Ltd. <sup>1</sup> | Korea |  | December | (907210) |  | Asset-backed securitization |
|  Songdo PFive 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | 830618 |  | Asset-backed securitization |
|  Newstar Gimpo 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (86438) |  | Asset-backed securitization |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Location** | **Percent**<br> **age of<br>ownership(%)** | **Date of<br>financial<br>statements<sup>5</sup>** | **Net Asset** | **Book amount** | **Main**<br> **Business** |
|  Able Gongpyeong 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 31243 |  | Asset-backed securitization |
|  Able Chowall 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (8654) |  | Asset-backed securitization |
|  FN Gasan 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 151345 |  | Asset-backed securitization |
|  Newstar Believe Co., Ltd. <sup>1</sup> | Korea |  | December | (296886) |  | Asset-backed securitization |
|  ABR Joongang2 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 290572 |  | Asset-backed securitization |
|  KB Tongyoung 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (280980) |  | Asset-backed securitization |
|  Able Sky 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 205106 |  | Asset-backed securitization |
|  Able Poongdong 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 20089 |  | Asset-backed securitization |
|  Able Sewoon Co., Ltd. <sup>1</sup> | Korea |  | December | 232004 |  | Asset-backed securitization |
|  Able Gasan 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (208595) |  | Asset-backed securitization |
|  Able PT 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (315029) |  | Asset-backed securitization |
|  Newstar Plus 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 270056 |  | Asset-backed securitization |
|  KB MyeongJi 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 98240 |  | Asset-backed securitization |
|  Able Dangjin 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 517800 |  | Asset-backed securitization |
|  KB Osansegyo 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | (1437) |  | Asset-backed securitization |
|  KB Mapo 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | (898279) |  | Asset-backed securitization |
|  Able Wonchang 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (46160) |  | Asset-backed securitization |
|  Zitaress 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (178091) |  | Asset-backed securitization |
|  Able Beomeo-one Co., Ltd. <sup>1</sup> | Korea |  | December | (214104) |  | Asset-backed securitization |
|  KB Infra 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | 313932 |  | Asset-backed securitization |
|  Newstar Sina Co., Ltd. <sup>1</sup> | Korea |  | December | (608791) |  | Asset-backed securitization |
|  KB Gold 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 15041 |  | Asset-backed securitization |
|  Inspire Gold 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | (212714) |  | Asset-backed securitization |
|  Able MK 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (101453) |  | Asset-backed securitization |
|  Newstar Gimpo 4th Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (8871) |  | Asset-backed securitization |
|  HD Value 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (9400) |  | Asset-backed securitization |
|  Powerplay 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 288040 |  | Asset-backed securitization |
|  Able Wonsi 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (798132) |  | Asset-backed securitization |
|  Able Dosan 1st Co., Ltd <sup>1, 2</sup> | Korea |  | December | 214432 |  | Asset-backed securitization |
|  Newstar Gimpopoongmoo Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 159784 |  | Asset-backed securitization |
|  Able Maseok 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (300967) |  | Asset-backed securitization |
|  TW Seocho 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (230018) |  | Asset-backed securitization |
|  TW Seocho 2nd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (349910) |  | Asset-backed securitization |
|  Newstar Wave 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (785243) |  | Asset-backed securitization |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Location** | **Percent**<br> **age of<br>ownership(%)** | **Date of<br>financial<br>statements<sup>5</sup>** | **Net Asset** | **Book amount** | **Main**<br> **Business** |
|  Lamdamine 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (146973) |  | Asset-backed securitization |
|  Able Next 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (991758) |  | Asset-backed securitization |
|  Able Dongil 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (124039) |  | Asset-backed securitization |
|  Newstar Shiny 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (196305) |  | Asset-backed securitization |
|  Newstar Enerbil 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (182606) |  | Asset-backed securitization |
|  YSMC 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (892249) |  | Asset-backed securitization |
|  HJ Galaxy 3rd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 229465 |  | Asset-backed securitization |
|  KB SmartSchool 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (464566) |  | Asset-backed securitization |
|  Bighouse 7th Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (985269) |  | Asset-backed securitization |
|  Newstar Energy 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (5618828) |  | Asset-backed securitization |
|  Gyeongsan Logis 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 557520 |  | Asset-backed securitization |
|  Stoke 2nd Corp <sup>1, 2</sup> | Korea |  | December | 643798 |  | Asset-backed securitization |
|  KB Samyoung Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 26638 |  | Asset-backed securitization |
|  Newstar Seongnam 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 292721 |  | Asset-backed securitization |
|  KPS Sihwa 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 3569531 |  | Asset-backed securitization |
|  KB NY 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (1707082) |  | Asset-backed securitization |
|  GDIC 2nd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (508028) |  | Asset-backed securitization |
|  Newstar NRB First Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (1808292) |  | Asset-backed securitization |
|  Able Dongtan 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (871617) |  | Asset-backed securitization |
|  Newstar Gimpo 5th Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (1481018) |  | Asset-backed securitization |
|  Cassiopeia 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (230886) |  | Asset-backed securitization |
|  Able Banpo 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (199514) |  | Asset-backed securitization |
|  Able Banpo 2nd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (177437) |  | Asset-backed securitization |
|  Able Gyeonggi Gwangju 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (380377) |  | Asset-backed securitization |
|  Newstar Byeongjeom 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (158797) |  | Asset-backed securitization |
|  Piggarden 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (312498) |  | Asset-backed securitization |
|  |  |  |  |  | 962256250 |  |
|  **Associates** |  |  |  |  |  |  |
|  Wise Asset Management Co., Ltd. <sup>3</sup> | Korea | 33.00 |  |  |  | Asset Mgt. |
|  KB Special Purpose Acquisition Company No.21 <sup>4</sup> | Korea | 0.13 | November | 20053 | 10000 | SPAC |
|  KB Special Purpose Acquisition Company No.22 <sup>4</sup> | Korea | 0.19 | November | 19767 | 10000 | SPAC |
|  KB Special Purpose Acquisition Company No.23 <sup>4</sup> | Korea | 0.08 | November | 10060 | 5000 | SPAC |
|  KB Special Purpose Acquisition Company No.24 <sup>4</sup> | Korea | 1.67 | November | 57197 | 25000 | SPAC |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Location** | **Percent**<br> **age of<br>ownership(%)** | **Date of<br>financial<br>statements<sup>5</sup>** | **Net Asset** | **Book amount** | **Main**<br> **Business** |
|  KB New Paradigm Agriculture Venture Fund | Korea | 25.00 | December | 2976845 | 2100000 | Investment |
|  KB KONEX Market Vitalization Fund | Korea | 23.44 | December | 7301375 | 615000 | Investment |
|  KB-KDBC New Technology Business Investment Fund | Korea | 33.33 | December | 2988748 | 1800000 | Investment |
|  KBTS Technology Venture Private Equity Fund <sup>4</sup> | Korea | 16.00 | December | 3941180 | 2784000 | Investment |
|  KB-SJ Tourism Venture Fund <sup>4</sup> | Korea | 18.52 | December | 3773125 | 4600000 | Investment |
|  KB Shinjasanaubo Fund <sup>4</sup> | Korea | 14.67 | December | 1810764 | 1804000 | Investment |
|  UNION Media Commerce Fund | Korea | 28.99 | December | 956728 | 1000000 | Investment |
|  KB-Brain KOSDAQ Scale-Up Fund <sup>4</sup> | Korea | 15.96 | December | 6675432 | 4950000 | Investment |
|  KB SPROTT Renewable Private Equity Fund I <sup>4</sup> | Korea | 7.69 | December | 3374650 | 3682135 | Investment |
|  KB-Stonebridge Secondary Private Equity Fund <sup>4</sup> | Korea | 4.16 | December | 7184026 | 6800355 | Investment |
|  KB-SP Private Equity Fund IV <sup>4</sup> | Korea | 14.95 | December | 1892224 | 6100000 | Investment |
|  KB-UTC Inno-Tech Venture Fund <sup>4</sup> | Korea | 14.76 | December | 6393024 | 7125000 | Investment |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund <sup>4</sup> | Korea | 6.00 | December | 6276963 | 5003207 | Investment |
|  December & Company Inc. <sup>4</sup> | Korea | 16.73 | December | 3735016 | 21838134 | System software development |
|  KB Material and Parts No. 1 PEF <sup>4</sup> | Korea | 14.47 | December | 3320638 | 3400000 | Investment |
|  KB Global Commerce Private Equity Investment Fund <sup>4</sup> | Korea | 16.28 | December | 6219107 | 7000000 | Investment |
|  KB-KTB Technology Venture Fund <sup>4</sup> | Korea | 18.18 | December | 5806248 | 6000000 | Investment |
|  KB Bio Global Expansion Private Equity Fund No.1 | Korea | 39.47 | December | 15779019 | 15000000 | Investment |
|  KB Digital Platform Fund <sup>4</sup> | Korea | 16.67 | December | 9055919 | 9500000 | Investment |
|  KB-SOLIDUS Healthcare Investment Fund <sup>4</sup> | Korea | 4.90 | December | 1036176 | 1100000 | Investment |
|  KB-GeneN Medical Venture Fund 1 | Korea | 22.52 | December | 1964512 | 2000000 | Investment |
|  KB-BridgePole Venture Investment Fund <sup>4</sup> | Korea | 6.30 | December | 834741 | 850000 | Investment |
|  KB-Kyobo New Mobility Power Fund | Korea | 28.57 | December | 2826264 | 3000000 | Investment |
|  DA-Friend Investment Fund II | Korea | 27.06 | December | 948652 | 987633 | Investment |
|  Cornerstone Pentastone IV Fund | Korea | 21.52 | December | 792174 | 817742 | Investment |
|  SKS-VLP Fund No.2 | Korea | 23.11 | December | 1121400 | 1155560 | Investment |
|  JS Private Equity Fund III | Korea | 20.48 | December | 1664180 | 1700000 | Investment |
|  Mirae Asset Mobility Investment Fund I | Korea | 22.99 | December | 1979241 | 2000000 | Investment |
|  KB-FT 1st Green Growth Investment Fund <sup>4</sup> | Korea | 10.34 | December | 1969650 | 2000000 | Investment |
|  THE CHAEUL FUND NO.1(former SKS IB NEW M&T FUND NO.1) | Korea | 31.25 | December | 989491 | 1000000 | Investment |
|  POSITIVE Sobujang Venture Fund No.1 | Korea | 43.96 | December | 1977209 | 2000000 | Investment |
|  KB-NP Green ESG New Technology Venture Capital Fund <sup>4</sup> | Korea | 11.59 | December | 3617183 | 3740000 | Investment |
|  Hisstory 2022 Fintech Fund | Korea | 34.78 | December | 1980701 | 2000000 | Investment |
|  PEBBLES-MW M.C.E New Technology Investment Fund 1st | Korea | 23.26 | December | 1981813 | 2000000 | Investment |
|  KB Star REIT | Korea | 26.94 | December | 136323142 | 45523300 | Investment |
|  KB Bio Private Equity Investment Fund IV | Korea | 24.19 | December | 7492209 | 7500000 | Investment |
|  Nextrade Co., Ltd. <sup>4</sup> | Korea | 6.64 | December | 9700000 | 9700000 | Investment |
|  |  |  |  |  | 200226066 |  |
|  |  |  |  |  | 1162482316 |  |

---

<sup>1</sup> The Company has control over the special purpose entities ("SPEs") and is exposed to variable returns. Accordingly, these SPEs are included as subsidiaries although the Company's ownership is less than 50%. 

<sup>2</sup> Newly established in 2021 and included as subsidiaries.

<sup>3</sup> The Company recognized the entire book amount as a loss before the year ended December 31, 2020, as a big loss was expected. Disposal of securities are restricted due to stock lock-up requirements. 

<sup>4</sup> Although the ownership of the Company is less than 20%, these are included as associates, since the Company has a significant influence over investee's policy and operations. 

<sup>5</sup> The date is the closing date of financial statements used for the purpose of assessment of net asset value.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Location** | **Percent**<br> **age of<br>ownership(%)** | **Date of<br>financial<br>statements<sup>5</sup>** | **Net Asset** | **Book amount** | **Main**<br> **Business** |
|  **Subsidiaries** |  |  |  |  |  |  |
|  KBFG Securities America Inc. | USA | 100.00 | December | 17374703 | 17259715 | Investment, advisory |
|  KB Securities Hong Kong Ltd. | Hong<br>Kong | 100.00 | December | 226462101 | 219432709 | Investment, advisory |
|  KB Securities Vietnam Joint Stock Company | Vietnam | 99.81 | December | 194696641 | 173875579 | Investment, advisory |
|  KB FINA Joint Stock Company | Vietnam | 77.82 | December | 14663774 | 11146330 | IT(Fintech) |
|  KB digital innovation & growth new technology business investment fund <sup>1</sup> | Korea | 20.00 | December | 9106621 | 2000000 | Other financial |
|  KB Pre-IPO 2nd (TCB) New<br> Technology Business Investment Fund <sup>1</sup> | Korea | 42.86 | December | 33499341 | 15000000 | Other financial |
|  JB New Jersey Private Real Estate Fund 1 | Korea | 98.15 | December | 17267434 | 1074621 | Funds |
|  Heungkuk Global Highclass Private Real Estate Trust 23 | Korea | 100.00 | December | 2334312 | 1903215 | Funds |
|  DGB General Private Real Estate Investment Trust No.8 | Korea | 98.77 | December | 7092945 | 6967178 | Funds |
|  LB Ireland Private Real Estate Investment Trust 8 | Korea | 96.64 | December | 67508018 | 66076000 | Funds |
|  Pacific US Blackrock Private Placement Real Estate Fund No.15 | Korea | 99.50 | December | 17710890 | 18697397 | Funds |
|  KTB Aircraft Private Investment Trust No.21-1 | Korea | 99.61 | December | 27791975 | 27752839 | Funds |
|  Vestas General Private Real Estate Fund Investment Trust No. 38 | Korea | 54.84 | December | 171044364 | 93059747 | Funds |
|  Mangrove Feeder Fund | Cayman<br>Islands | 92.88 | December | 77506120 | 67008400 | Funds |
|  GH Real Estate I LP | Guernsey | 81.00 | December | 25965320 | 21031909 | Investment |
|  JB Dry Street Private Fund1 | Korea | 100.00 | December | 801028 | 1060697 | Funds |
|  JB Australia108 Private Fund1 | Korea | 100.00 | December | 565966 | 759207 | Funds |
|  JB Forge Private Fund1 | Korea | 100.00 | December | 397635 | 543244 | Funds |
|  JB Hall Street Private Fund1 | Korea | 100.00 | December | 749327 | 1016152 | Funds |
|  JB Margaret Street Private Fund1 | Korea | 100.00 | December | 212296 | 288186 | Funds |
|  LB UK Private Real Estate Investment<br> Trust No.18 | Korea | 96.78 | December | 32429491 | 34500000 | Funds |
|  Alpha Spain Real Estate Private<br> Investment Trust 1 | Korea | 99.85 | December | 69615347 | 67622466 | Funds |
|  Hanwha US Equity Strategy Private<br> Real Estate Fund 3 <sup>2</sup> | Korea | 99.95 | December | 169094784 | 183669714 | Funds |
|  Ms Sejong 4th Co., Ltd. <sup>1</sup> | Korea |  | December | (318079) |  | Asset-backed securitization |
|  KB UK Center 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 512231 |  | Asset-backed securitization |
|  Able Gwonseon 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (188406) |  | Asset-backed securitization |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Location** | **Percent**<br> **age of<br>ownership(%)** | **Date of<br>financial<br>statements<sup>5</sup>** | **Net Asset** | **Book amount** | **Main**<br> **Business** |
|  AJH 3rd Co., Ltd. <sup>1</sup> | Korea |  | December | 411135 |  | Asset-backed securitization |
|  Paradise Yeongjong 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | (1277197) |  | Asset-backed securitization |
|  Newstar IP Co., Ltd. <sup>1</sup> | Korea |  | December | 6700346 |  | Asset-backed securitization |
|  Enewstay 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 8289028 |  | Asset-backed securitization |
|  New star Panorama 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 678535 |  | Asset-backed securitization |
|  New star Papyrus Co., Ltd. <sup>1</sup> | Korea |  | December | (513513) |  | Asset-backed securitization |
|  SJ Jongno 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (3004440) |  | Asset-backed securitization |
|  Newstar Ds 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 191023 |  | Asset-backed securitization |
|  Newstar Ds 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | 524462 |  | Asset-backed securitization |
|  Able Gamsam 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 76100 |  | Asset-backed securitization |
|  Songdo Pfive 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | 1298857 |  | Asset-backed securitization |
|  Newstar Gimpo 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (63753) |  | Asset-backed securitization |
|  Polar EH 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 567650 |  | Asset-backed securitization |
|  Polar EH 2nd Co., Ltd. <sup>1</sup> | Korea |  | December | 910383 |  | Asset-backed securitization |
|  Able Gongpyeong 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 91865 |  | Asset-backed securitization |
|  Able Chowall 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (215427) |  | Asset-backed securitization |
|  FN Gasan 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (1908) |  | Asset-backed securitization |
|  ABR Mareuk 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (45716) |  | Asset-backed securitization |
|  Newstar Believe Co., Ltd. <sup>1</sup> | Korea |  | December | (263848) |  | Asset-backed securitization |
|  Able Electronics 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 174974 |  | Asset-backed securitization |
|  KB Echo 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 236375 |  | Asset-backed securitization |
|  ABR Joongang2 1st Co., Ltd. <sup>1</sup> | Korea |  | December | 117313 |  | Asset-backed securitization |
|  KB Tongyoung 1st Co., Ltd. <sup>1</sup> | Korea |  | December | (244026) |  | Asset-backed securitization |
|  Able Guwol 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (160458) |  | Asset-backed securitization |
|  Able Sky 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (462684) |  | Asset-backed securitization |
|  Newstar Gimpo 2nd Co.,Ltd. <sup>1, 2</sup> | Korea |  | December | 338948 |  | Asset-backed securitization |
|  Able Hyosung 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (114657) |  | Asset-backed securitization |
|  Able Poongdong 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (17866) |  | Asset-backed securitization |
|  Able Sewoon Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (1118266) |  | Asset-backed securitization |
|  KB Infra 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 226900 |  | Asset-backed securitization |
|  Intgreen 1st Inc. <sup>1, 2</sup> | Korea |  | December | (660735) |  | Asset-backed securitization |
|  Able Gasan 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (49387) |  | Asset-backed securitization |
|  Able Pocheon 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 46094 |  | Asset-backed securitization |
|  Newstar Seotan Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 208862 |  | Asset-backed securitization |
|  Able PT 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (159043) |  | Asset-backed securitization |
|  Unbroken 1st Co., Ltd, <sup>1, 2</sup> | Korea |  | December | (454809) |  | Asset-backed securitization |
|  JOSH Bujeon 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (590290) |  | Asset-backed securitization |
|  Newstarplus1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 291848 |  | Asset-backed securitization |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Location** | **Percent**<br> **age of<br>ownership(%)** | **Date of<br>financial<br>statements<sup>5</sup>** | **Net Asset** | **Book amount** | **Main**<br> **Business** |
|  KB MyeongJi 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 46905 |  | Asset-backed securitization |
|  Able Dangjin 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (84172) |  | Asset-backed securitization |
|  Able Yongdap 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (72070) |  | Asset-backed securitization |
|  KB Osansegyo 2nd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (20294) |  | Asset-backed securitization |
|  Able Hyeongok Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (63847) |  | Asset-backed securitization |
|  KB Mapo 2nd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 119719 |  | Asset-backed securitization |
|  GDIC 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (416815) |  | Asset-backed securitization |
|  Able Wonchang 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (226519) |  | Asset-backed securitization |
|  Zitaress 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (732386) |  | Asset-backed securitization |
|  KB PF 3rd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (8391) |  | Asset-backed securitization |
|  Able Beomeo-one Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (64991) |  | Asset-backed securitization |
|  Able Yucheon 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (1006041) |  | Asset-backed securitization |
|  KB Infra 2nd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (2135492) |  | Asset-backed securitization |
|  KB Illite 1st. Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (37591) |  | Asset-backed securitization |
|  Newstar Sina Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (369157) |  | Asset-backed securitization |
|  KB Gold 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | 39430 |  | Asset-backed securitization |
|  Inspire Gold 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (641000) |  | Asset-backed securitization |
|  Inspire Gold 2nd Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (294713) |  | Asset-backed securitization |
|  Able MK 1st Co., Ltd, <sup>1, 2</sup> | Korea |  | December | (39136) |  | Asset-backed securitization |
|  Yeoksam The Gallery KB 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (21787) |  | Asset-backed securitization |
|  Y Three Ulsan Sinjeong 1st Co., Ltd. <sup>1, 2</sup> | Korea |  | December | (274134) |  | Asset-backed securitization |
|  |  |  |  |  | 1031745305 |  |
|  **Associates** |  |  |  |  |  |  |
|  Wise Asset Management Co., Ltd. <sup>3</sup> | Korea | 33.00 |  |  |  | Asset Mgt. |
|  KB Special Purpose Acquisition Company No.17 <sup>4</sup> | Korea | 0.01 | November | 10432587 | 500 | SPAC |
|  KB Special Purpose Acquisition Company No.18 <sup>4</sup> | Korea | 0.01 | November | 15292628 | 1000 | SPAC |
|  KB Special Purpose Acquisition Company No.19 <sup>4</sup> | Korea | 0.02 | November | 8197372 | 1000 | SPAC |
|  KB Special Purpose Acquisition Company No.20 <sup>4</sup> | Korea | 0.02 | November | 12438883 | 1000 | SPAC |
|  KB New Paradigm Agriculture Venture Fund | Korea | 25.00 | December | 11763467 | 2725000 | Investment |
|  KB KONEX Market Vitalization Fund | Korea | 23.44 | December | 23233115 | 615000 | Investment |
|  KB-KDBC Pre-IPO New Technology Business Investment Fund | Korea | 33.33 | December | 17683622 | 4400000 | Investment |
|  KBTS Technology Venture Private Equity Fund <sup>4</sup> | Korea | 16.00 | December | 30050612 | 4080000 | Investment |
|  KB-SJ Tourism Venture Fund <sup>4</sup> | Korea | 18.52 | December | 22390155 | 5000000 | Investment |
|  KB Shinjasanaubo Fund <sup>4</sup> | Korea | 14.67 | December | 12935423 | 1936000 | Investment |
|  UNION Media Commerce Fund | Korea | 28.99 | December | 3308233 | 1000000 | Investment |
|  KB-Brain KOSDAQ Scale-Up Fund <sup>4</sup> | Korea | 15.96 | December | 69721862 | 9750000 | Investment |
|  KB SPROTT Renewable Private Equity Fund I <sup>4</sup>  | Korea | 7.69 | December | 12418787 | 1182775 | Investment |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Location** | **Percent**<br> **age of<br>ownership(%)** | **Date of<br>financial<br>statements<sup>5</sup>** | **Net Asset** | **Book amount** | **Main**<br> **Business** |
|  KB-Stonebridge Secondary Private Equity Fund <sup>4</sup> | Korea | 4.16 | December | 150687823 | 6183416 | Investment |
|  KB-SP Private Equity Fund IV <sup>4</sup> | Korea | 14.95 | December | 37641126 | 6100000 | Investment |
|  KB-UTC Inno-Tech Venture Fund <sup>4</sup> | Korea | 14.76 | December | 47351174 | 7125000 | Investment |
|  KB-NAU Special Situation Corporate<br> Restructuring Private Equity Fund <sup>4</sup> | Korea | 6.00 | December | 127116527 | 6696000 | Investment |
|  Project Vanilla Co., Ltd. | Korea | 49.00 | December | 1072130 | 525344 | System software development |
|  December & Company Inc. <sup>4</sup> | Korea | 16.78 | December | 53943247 | 30000000 | System software development |
|  KB Material and Parts No. 1 PEF <sup>4</sup> | Korea | 14.47 | December | 23103939 | 3400000 | Investment |
|  KB Bio Private Equity Fund III Ltd. <sup>4</sup> | Korea | 12.20 | December | 81590446 | 10000000 | Investment |
|  KB Global Commerce Private Equity Investment Fund <sup>4</sup> | Korea | 16.28 | December | 41896320 | 7000000 | Investment |
|  KB-KTB Technology Venture Fund <sup>4</sup> | Korea | 18.18 | December | 10907389 | 2000000 | Investment |
|  KB Bio Global Expansion Private Equity Fund No.1 | Korea | 39.47 | December | 37916484 | 15000000 | Investment |
|  KB Digital Platform Fund <sup>4</sup> | Korea | 16.67 | December | 26998474 | 4500000 | Investment |
|  KB-SOLIDUS Healthcare Investment Fund <sup>4</sup> | Korea | 4.90 | December | 2040000 | 100000 | Investment |
|  |  |  |  |  | 129322035 |  |
|  |  |  |  |  | 1161067340 |  |

---

<sup>1</sup> The Company has control over the special purpose entities ("SPEs") and is exposed to variable returns. Accordingly, these SPEs are included as subsidiaries although the Company's ownership is less than 50%. 

<sup>2</sup> Newly established in 2021 and included as subsidiaries.

<sup>3</sup> The Company recognized the entire book amount as a loss before the year ended December 31, 2020, as a big loss was expected. Disposal of securities are restricted due to stock lock-up requirements. 

<sup>4</sup> Although the ownership of the Company is less than 20%, these are included as associates, since the Company has a significant influence over investee's policy and operations. 

<sup>5</sup> The date is the closing date of financial statements used for the purpose of assessment of net asset value.

Changes in investments in subsidiaries for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Impaired** | **Re-classification <sup>1</sup>** | **Others** | **Ending**<br> **balance** |
|  KBFG Securities America Inc. | 17259715 |  |  |  |  |  | 17259715 |
|  KB Securities Hong Kong Ltd. | 219432709 |  |  |  |  | 13211016 | 232643725 |
|  KB Securities Vietnam Joint Stock Company | 173875579 |  |  |  |  |  | 173875579 |
|  KB FINA Joint Stock Company | 11146330 |  |  |  |  |  | 11146330 |
|  PT. KB Valbury Sekuritas |  | 57221997 |  |  |  |  | 57221997 |
|  KB Digital Innovation&growth New Technology Business Investment Fund | 2000000 |  |  |  |  |  | 2000000 |
|  KB Pre-IPO <sup>2nd</sup> (TCB) New Technology Business Investment Fund | 15000000 |  |  |  |  |  | 15000000 |
|  JB New Jersey Private Real Estate Fund 1 | 1074621 |  |  |  |  |  | 1074621 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Impaired** | **Re-classification <sup>1</sup>** | **Others** | **Ending**<br> **balance** |
|  Heungkuk Global Highclass Private Real Estate Trust 23 | 1903215 |  | (1903215) |  |  |  |  |
|  DGB General Private Real Estate Investment Trust No.8 | 6967178 |  | (6967178) |  |  |  |  |
|  LB Irealand Private Real Estate Investment Trust 8 | 66076000 |  |  |  |  |  | 66076000 |
|  Pacific US BlackRock Private Placement Real Estate Fund Investment Trust No. 15 | 18697397 | 3142188 | (198569) |  |  |  | 21641016 |
|  KTB Aircraft Private Investment Trust No.21- 1 | 27752839 |  |  |  |  |  | 27752839 |
|  Vestas General Private Real Estate Fund Investment Trust No. 38 | 93059747 | 11340804 |  |  |  |  | 104400551 |
|  Mangrove Feeder Fund | 67008400 |  |  |  |  | 4001690 | 71010090 |
|  GH Real Estate I LP | 21031909 |  |  | (1598) |  |  | 21030311 |
|  JB Dry Street Private Fund 1 | 1060697 |  | (86497) |  |  |  | 974200 |
|  JB Australia108 Private Fund 1 | 759207 |  | (61708) |  |  |  | 697499 |
|  JB Forge Private Fund 1 | 543244 |  | (44182) |  |  |  | 499062 |
|  JB Hall Street Private Fund 1 | 1016152 |  | (82632) |  |  |  | 933520 |
|  JB Margaret Street Private Fund 1 | 288186 |  | (23401) |  |  |  | 264785 |
|  LB UK Private Real Estate Investment Trust No.18 <sup>1</sup> | 34500000 |  | (28941213) |  | (5558787) |  |  |
|  Alpha Spain Real Estate Private Investment Trust 1 | 67622466 |  | (67622466) |  |  |  |  |
|  Hanwha US Equity Strategy Private Real Estate Fund 3 | 183669714 |  | (180885304) |  |  |  | 2784410 |
|  Korea Investment US Amazon Logistics Private Real Estate Investment Trust NO. 1 <sup>1</sup> |  | 20900000 | (20800000) |  | (100000) |  |  |
|  GVA Europe Real Estate Investment Trust No.2 |  | 95000000 | (95000000) |  |  |  |  |
|  KB Global Contents Private Investment Fund |  | 4500000 |  |  |  |  | 4500000 |
|  GVA Europe Pre-IPO Private Investment Trust No.1 |  | 20000000 |  |  |  |  | 20000000 |
|  LIFE Global Reits Pre- IPO General Private Investment Trust 1 |  | 59470000 |  |  |  |  | 59470000 |
|  KB KBSTAR US Short- Term IG Corporate Bond ETF |  | 50000000 |  |  |  |  | 50000000 |
|  KB Wisestar Private Real Estate Fund Investment Trust No. 2 <sup>1</sup> |  | 67100000 |  |  | (67100000) |  |  |
|  | 1031745305 | 388674989 | (402616365) | (1598) | (72758787) | 17212706 | 962256250 |

---

<sup>1</sup> These instruments are reclassified to financial assets measured at FVTPL during the year ended December 31, 2022 .

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Impaired** | **Others** | **Ending**<br> **balance** |
|  KBFG Securities America Inc. | 17259715 |  |  |  |  | 17259715 |
|  KB Securities Hong Kong Ltd. | 117143369 | 101175500 |  |  | 1113840 | 219432709 |
|  KB Securities Vietnam Joint Stock Company | 104791511 | 69084068 |  |  |  | 173875579 |
|  KB FINA Joint Stock Company | 11146330 |  |  |  |  | 11146330 |
|  Hyundai Dynamic Mix Securities Feeder<br> Investment Trust 1 | 5559136 |  | (5559136) |  |  |  |
|  Hyundai Kon-tiki Specialized Privately Placed Fund 1 | 476406 |  | (476406) |  |  |  |
|  JB New Jersey Private Real Estate Fund 1 | 1074621 |  |  |  |  | 1074621 |
|  Heungkuk Global Highclass Private Real Estate Trust 23 | 3533980 |  | (1630765) |  |  | 1903215 |
|  DGB General Private Real Estate Investment Trust No.8 | 7327638 |  | (360460) |  |  | 6967178 |
|  LB Ireland Private Real Estate Investment Trust 8 | 66076000 |  |  |  |  | 66076000 |
|  Aquila Global Real Assets Fund No. 1 LP | 1 |  | (1) |  |  |  |
|  Mangrove Feeder Fund | 61755900 |  |  |  | 5252500 | 67008400 |
|  GH Real Estate I LP | 28916236 |  |  | (7884327) |  | 21031909 |
|  KTB Aircraft Private Investment Trust No.21-1 | 27752839 |  |  |  |  | 27752839 |
|  Pacific US Blackrock Private Placement Real Estate Fund No.15 | 15371600 | 3325797 |  |  |  | 18697397 |
|  KB digital innovation & growth new technology business investment fund | 1500000 | 500000 |  |  |  | 2000000 |
|  KB Pre-IPO 2nd (TCB) New Technology Business Investment Fund | 3750000 | 11250000 |  |  |  | 15000000 |
|  Vestas General Private Real Estate Fund Investment Trust No. 38 | 93059747 |  |  |  |  | 93059747 |
|  JB Dry Street Private Fund1 | 1060697 |  |  |  |  | 1060697 |
|  JB Australia108 Private Fund1 | 759207 |  |  |  |  | 759207 |
|  JB Forge Private Fund1 | 543244 |  |  |  |  | 543244 |
|  JB Hall Street Private Fund1 | 1016152 |  |  |  |  | 1016152 |
|  JB Margaret Street Private Fund1 | 288186 |  |  |  |  | 288186 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Impaired** | **Others** | **Ending**<br> **balance** |
|  LB UK Private Real Estate Investment Trust No.18 | 34500000 |  |  |  |  | 34500000 |
|  Alpha Spain Real Estate Private Investment Trust 1 | 64323723 | 3298743 |  |  |  | 67622466 |
|  Hangang Domestic Private Real Estate Fund No.14 | 18100000 |  | (18100000) |  |  |  |
|  Hanwha US Equity Strategy Private Real Estate Fund 3 |  | 183678409 | (8695) |  |  | 183669714 |
|  Pacific Bric Professional Investors' Private Real Estate Fund No.53 |  | 43500000 | (43500000) |  |  |  |
|  | 687086238 | 415812517 | (69635463) | (7884327) | 6366340 | 1031745305 |

---

Changes in investment in associates for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Impaired** | **Re-classfification<sup>1</sup>** | **Ending <br>balance** |
|  KB Special Purpose Acquisition Company No.17 | 500 |  | (500) |  |  |  |
|  KB Special Purpose Acquisition Company No.18 | 1000 |  | (1000) |  |  |  |
|  KB Special Purpose Acquisition Company No.19 | 1000 |  | (1000) |  |  |  |
|  KB Special Purpose Acquisition Company No.20 | 1000 |  | (1000) |  |  |  |
|  KB Special Purpose Acquisition Company No.21 |  | 10000 |  |  |  | 10000 |
|  KB Special Purpose Acquisition Company No.22 |  | 10000 |  |  |  | 10000 |
|  KB Special Purpose Acquisition Company No.23 |  | 5000 |  |  |  | 5000 |
|  KB Special Purpose Acquisition Company No.24 |  | 25000 |  |  |  | 25000 |
|  KB New Paradigm Agriculture Venture Fund | 2725000 |  | (625000) |  |  | 2100000 |
|  KB KONEX Market Vitalization Fund | 615000 |  |  |  |  | 615000 |
|  KB-KDBC New Technology Business Investment Fund | 4400000 |  | (2600000) |  |  | 1800000 |
|  KBTS Technology Venture Private Equity Fund | 4080000 |  | (1296000) |  |  | 2784000 |
|  KB-SJ Tourism Venture Fund | 5000000 |  | (400000) |  |  | 4600000 |
|  KB Shinjasanaubo Fund | 1936000 |  | (132000) |  |  | 1804000 |
|  UNION Media Commerce Fund | 1000000 |  |  |  |  | 1000000 |
|  KB-Brain KOSDAQ Scale-Up Fund | 9750000 |  | (4800000) |  |  | 4950000 |
|  KB SPROTT Renewable Private Equity Fund I | 1182775 | 2499360 |  |  |  | 3682135 |
|  KB-Stonebridge Secondary Private Equity Fund | 6183416 | 1248439 | (631500) |  |  | 6800355 |
|  KB-SP Private Equity Fund IV | 6100000 |  |  |  |  | 6100000 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  KB-UTC Inno-Tech Venture Fund | 7125000 |  |  |  |  | 7125000 |
|  KB-NAU Special Situation Corporate Restructuring<br> Private Equity Fund | 6696000 | 660000 | (2352793) |  |  | 5003207 |
|  Project Vanilla Co., Ltd. | 525344 |  | (525344) |  |  |  |
|  December & Company Inc. | 30000000 |  |  | (8161866) |  | 21838134 |
|  KB Material and Parts No. 1 PEF | 3400000 |  |  |  |  | 3400000 |
|  KB Bio Private Equity Fund III Ltd. | 10000000 |  | (10000000) |  |  |  |
|  KB Global Commerce Private Equity Investment Fund | 7000000 |  |  |  |  | 7000000 |
|  KB-KTB Technology Venture Fund | 2000000 | 4000000 |  |  |  | 6000000 |
|  KB Bio Global Expansion Private Equity Fund No.1 | 15000000 |  |  |  |  | 15000000 |
|  KB Digital Platform Fund | 4500000 | 5000000 |  |  |  | 9500000 |
|  KB-SOLIDUS Healthcare Investment Fund | 100000 | 1000000 |  |  |  | 1100000 |
|  KB-GeneN Medical Venture Fund 1 |  | 2000000 |  |  |  | 2000000 |
|  KB-BridgePole Venture Investment Fund |  | 850000 |  |  |  | 850000 |
|  KB-Kyobo New Mobility Power Fund |  | 3000000 |  |  |  | 3000000 |
|  DA-Friend Investment Fund II |  |  |  |  | 987633 | 987633 |
|  Cornerstone Pentastone IV Fund |  |  |  |  | 817742 | 817742 |
|  SKS-VLP Fund No.2 |  |  |  |  | 1155560 | 1155560 |
|  JS Private Equity Fund III |  | 1700000 |  |  |  | 1700000 |
|  Mirae Asset Mobility Investment Fund I |  | 2000000 |  |  |  | 2000000 |
|  KB-FT 1st Green Growth Investment Fund |  | 2000000 |  |  |  | 2000000 |
|  THE CHAEUL FUND NO.1(former SKS IB NEW M&T FUND NO.1) |  | 1000000 |  |  |  | 1000000 |
|  POSITIVE Sobujang Venture Fund No.1 |  | 2000000 |  |  |  | 2000000 |
|  KB-NP Green ESG New Technology Venture Capital Fund |  | 3740000 |  |  |  | 3740000 |
|  Hisstory 2022 Fintech Fund |  | 2000000 |  |  |  | 2000000 |
|  PEBBLES-MW M.C.E New Technology Investment Fund 1st |  | 2000000 |  |  |  | 2000000 |
|  KB Star REIT |  | 45523300 |  |  |  | 45523300 |
|  KB Bio Private Equity Investment Fund IV |  | 7500000 |  |  |  | 7500000 |
|  Nextrade Co., Ltd. |  | 9700000 |  |  |  | 9700000 |
|  | 129322035 | 99471099 | (23366137) | (8161866) | 2960935 | 200226066 |

---

<sup>1</sup> These instruments are reclassified from financial assets measured at FVTPL for the year ended December 31, 2022 .

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Impaired** | **Re-classfification<sup>1</sup>** | **Ending <br>balance** |
|  KB Special Purpose Acquisition Company No.17 | 500 |  |  |  |  | 500 |
|  KB Special Purpose Acquisition Company No.18 | 1000 |  |  |  |  | 1000 |
|  KB Special Purpose Acquisition Company No.19 | 1000 |  |  |  |  | 1000 |
|  KB Special Purpose Acquisition Company No.20 | 1000 |  |  |  |  | 1000 |
|  KB Private Equity Fund III | 8 |  | (8) |  |  |  |
|  Keystone-Hyundai Sec. No.1 Private Equity Fund | 1925000 |  | (1925000) |  |  |  |
|  KB New Paradigm Agriculture Venture Fund | 5000000 |  | (2275000) |  |  | 2725000 |
|  KB KONEX Market Vitalization Fund | 6165000 |  | (5550000) |  |  | 615000 |
|  KB-KDBC Pre-IPO New Technology Business Investment Fund | 6800000 |  | (2400000) |  |  | 4400000 |
|  KBTS Technology Venture Private Equity Fund | 4736000 | 880000 | (1536000) |  |  | 4080000 |
|  KB-SJ Tourism Venture Fund | 4500000 | 500000 |  |  |  | 5000000 |
|  KB Shinjasanaubo Fund | 1320000 | 880000 | (264000) |  |  | 1936000 |
|  UNION Media Commerce Fund | 1000000 |  |  |  |  | 1000000 |
|  KB-Brain KOSDAQ Scale-Up Fund | 10050000 | 3750000 | (4050000) |  |  | 9750000 |
|  KB SPROTT Renewable Private Equity Fund I | 1182775 |  |  |  |  | 1182775 |
|  KB-Stonebridge Secondary Private Equity Fund | 4088000 | 3788000 | (1692584) |  |  | 6183416 |
|  KB-SP Private Equity Fund IV | 6100000 |  |  |  |  | 6100000 |
|  KB-UTC Inno-Tech Venture Fund | 5805000 | 1695000 | (375000) |  |  | 7125000 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 2850000 | 3846000 |  |  |  | 6696000 |
|  JR GLOBAL REIT | 215854340 |  | (65025000) |  | (150829340) |  |
|  Project Vanilla Co., Ltd. | 2450000 |  |  | (1924656) |  | 525344 |
|  December & Company Inc. | 30000000 |  |  |  |  | 30000000 |
|  KB Material and Parts No. 1 PEF | 3400000 |  |  |  |  | 3400000 |
|  KB Bio Private Equity Fund III Ltd. |  | 10000000 |  |  |  | 10000000 |
|  K The fifteenth Real Estate Investment Trust |  | 8600000 | (8600000) |  |  |  |
|  KB Global Commerce Private Equity Investment Fund |  | 7000000 |  |  |  | 7000000 |
|  KB-KTB Technology Venture Fund |  | 2000000 |  |  |  | 2000000 |
|  KB Bio Global Expansion Private Equity Fund No.1 |  | 15000000 |  |  |  | 15000000 |
|  KB Digital Platform Fund |  | 4500000 |  |  |  | 4500000 |
|  KB-SOLIDUS Healthcare Investment Fund |  | 100000 |  |  |  | 100000 |
|  | 313229623 | 62539000 | (93692592) | (1924656) | (150829340) | 129322035 |

---

<sup>1</sup> These instruments are reclassified to financial assets measured at FVTPL for the year ended December 31, 2021 .

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**10. Loans Measured at Amortised Cost** 

The details of loans measured at amortised cost as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Total amount** | **Allowances** | **Book amount** | **Total amount** | **Allowances** | **Book amount** |
|  Retails |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Broker's loans | 2670524438 |  | 2670524438 | 2875271205 |  | 2875271205 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans to employees | 11821078 |  | 11821078 | 15067486 |  | 15067486 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Present value discount | (25619) |  | (25619) | (25619) |  | (25619) |
|  | 2682319897 |  | 2682319897 | 2890313072 |  | 2890313072 |
|  Corporate |  |  |  |  |  |  |
|  Broker's loans | 277741537 |  | 277741537 | 270439064 |  | 270439064 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities purchased under repurchase agreements | 730100000 |  | 730100000 | 441800000 |  | 441800000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans receivable | 2789966306 | (16386956) | 2773579350 | 1730116707 | (12919579) | 1717197128 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchased loans | 78787460 | (3193805) | 75593655 | 98535846 | (33549254) | 64986592 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Advances for customers | 7564877 | (7564877) |  | 11404578 | (11404578) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Privately placed bonds | 500000 | (299446) | 200554 | 14375767 | (331495) | 14044272 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial lease receivables | 35135664 |  | 35135664 | 41127430 |  | 41127430 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net deferred origination fees and costs | (4820171) |  | (4820171) | (5314862) |  | (5314862) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Present value discount | (3064593) |  | (3064593) | (4148880) |  | (4148880) |
|  | 3911911080 | (27445084) | 3884465996 | 2598335650 | (58204906) | 2540130744 |
|  | 6594230977 | (27445084) | 6566785893 | 5488648722 | (58204906) | 5430443816 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The change in book amount of loan measured at amortised cost for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **Retails** | **Retails** | **Retails** | **Corporates** | **Corporates** | **Corporates** | **Corporates** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The<br>financial<br>instruments<br>applying<br>lifetime<br>expected<br>credit<br>losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The<br>financial<br>instruments<br>applying<br>lifetime<br>expected<br>credit<br>losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** |
|  Beginning | 2890313073 |  |  | 2549095780 |  | 49239870 |  |
|  Transfer between stages |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected credit Losses (Impaired) |  |  |  | (6675000) |  | 6675000 |  |
|  Write-off |  |  |  |  |  | (33202354) |  |
|  Sale |  |  |  | (722881522) |  |  |  |
|  Other increase/decrease, net | (207993176) |  |  | 2074015038 |  | (4355732) |  |
|  Ending | 2682319897 |  |  | 3893554296 |  | 18356784 |  |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **Retails** | **Retails** | **Retails** | **Corporates** | **Corporates** | **Corporates** | **Corporates** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The<br>financial<br>instruments<br>applying<br>lifetime<br>expected<br>credit<br>losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The<br>financial<br>instruments<br>applying<br>lifetime<br>expected<br>credit<br>losses** | **The<br>financial<br>instruments<br>applying<br>credit loss<br>model** | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** |  |
|  Beginning | 2590998977 |  |  | 2403099320 | 10714286 | 49306826 |  |
|  Transfer between stages |  |  |  |  |  |  |  |
|  Sale |  |  |  | (137590000) |  |  |  |
|  Other increase/decrease, net | 299314095 |  |  | 283586460 | (10714286) | (66956) |  |
|  Ending | 2890313072 |  |  | 2549095780 |  | 49239870 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in allowances for loan losses for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(In thousands of Korean won)* | **2022** | **2022** | **2022** | **2022** |
|  | **Corporates** | **Corporates** | **Corporates** | **Corporates** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The<br>financial <br>instruments<br>applying<br>credit loss<br>model** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The<br>financial <br>instruments<br>applying<br>credit loss<br>model** |
|  Beginning | 9173399 |  | 49031507 |  |
|  Transfer between stages |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected credit Losses (Impaired) | (3461509) |  | 3461509 |  |
|  Write-off |  |  | (33202354) |  |
|  Provision for loan losses | 4984774 |  | 805841 |  |
|  Other transfer |  |  | (3348083) |  |
|  Ending | 10696664 |  | 16748420 |  |
| *(In thousands of Korean won)* | **2021** | **2021** | **2021** | **2021** |
|  | **Corporates** | **Corporates** | **Corporates** | **Corporates** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The<br>financial <br>instruments<br>applying<br>credit loss<br>model** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The<br>financial <br>instruments<br>applying<br>credit loss<br>model** |
|  Beginning | 4363646 | 427925 | 49098464 |  |
|  Transfer between stages |  |  |  |  |
|  Provision(Reversal) for loan losses | 4809753 | (427925) | (66957) |  |
|  Other transfer |  |  |  |  |
|  Ending | 9173399 |  | 49031507 |  |

---

Among the loans which have been written-off, the Company manages loans for which the claims against borrowers have not been lost due to reasons such as incomplete extinctive prescription pursuant to relevant laws and uncollected receivables after writing-off, as the written-off loans. As at December 31, 2022 and 2021, the balances of the written-off loans are W 9,218,967 thousand and W 4,600,194 thousand, respectively.

**Broker's loan** 

The Company provides loans for stock purchases with credit period of 180 days (can be extended for six times) for investors using margin transaction. As at December 31, 2022, interest rate of the loan is differentiated from 4.9% to 9.8% based on maturities, and overdue interest rate is 9.9%.

Also, as the Company operates loans secured by securities. At the initial transaction, in case of superior shares and common shares, the Company requires trading securities or cash as collateral, corresponding to 167% and 250% of the loan, respectively. Over 140% collateral of the loan is required. As at December 31, 2022, the interest rate of loans secured by securities is differentiated from Annual Percentage Rate(APR) 6.9% to 9.8% based on maturities, from APR 7.0% to 8.5% based on credit rating, and the loan with past due date is 9.9%

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

For margin loan to customers, trading securities or cash is required to be pledged corresponding to 140% of the loan. Because of this condition, the Company pledged securities as collateral which are purchased with margin to customer loan. If the value of the pledged securities do not reach to 140% of the loan, the Company requires additional cash or trading securities as collateral.

**Advances for Customers** 

Advances for customers consists of advanced payments on loss compensation and advanced payments for others.

Advanced payments on loss compensation are the monetary amount of claim for reimbursement, paid by the Company, if any losses from embezzlement and arbitrary trading are occurred.

Advanced payments for others consist of two types. The first type is the amount of recourse from paid Investor Protection Fund based on the previous Securities Exchange Act Article 69 Clause 2 or Clause 4. This recourse is driven by preferred payments to the securities company with reasonable reason for taking the preferred payments. The second type is the amount of recourse from Joint Compensation Fund based on Law relating to the Financial Investment Services and Capital Markets Act Article 323 Clause 14 and related Enforcement Decree Article 318 Clause 8. This recourse is driven by preferred payments to the securities company that occurred reasonable reasons for taking the preferred payments.

**11. Property and Equipment** 

The details of property and equipment as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Accumulated<br>revaluation** | **Book amount** |
|  Land | 28242445 |  | 83580757 | 111823202 |
|  Buildings | 40613878 | (18705038) |  | 21908840 |
|  Furniture and equipment | 166644659 | (134101041) |  | 32543618 |
|  Others | 56137689 | (43986992) |  | 12150697 |
|  Right-of-use assets | 134063357 | (58683464) |  | 75379893 |
|  | 425702028 | (255476535) | 83580757 | 253806250 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Accumulated<br>revaluation** | **Book amount** |
|  Land | 29301991 |  | 35727831 | 65029822 |
|  Buildings | 42017785 | (18619751) |  | 23398034 |
|  Furniture and equipment | 151136006 | (119791310) |  | 31344696 |
|  Others | 51441331 | (38219912) |  | 13221419 |
|  Right-of-use assets | 111255336 | (38828953) |  | 72426383 |
|  | 385152449 | (215459926) | 35727831 | 205420354 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The details of right-of-use assets as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Book amount** |
|  Buildings | 125426370 | (53310578) | 72115792 |
|  Vehicles | 4039939 | (1781351) | 2258588 |
|  Others | 4597048 | (3591535) | 1005513 |
|  | 134063357 | (58683464) | 75379893 |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Book amount** |
|  Buildings | 103497623 | (34351809) | 69145814 |
|  Vehicles | 3528320 | (1958126) | 1570194 |
|  Others | 4229393 | (2519018) | 1710375 |
|  | 111255336 | (38828953) | 72426383 |

---

The changes in property and equipment for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Depreciation** | **Re-valuation** | **Others <sup>1</sup>** | **Ending<br>balance** |
|  Land | 65029822 |  | (1115081) |  | 47521151 | 387310 | 111823202 |
|  Buildings | 23398034 |  | (543148) | (1007299) |  | 61253 | 21908840 |
|  Furniture and equipment | 31344696 | 15914642 | (5231) | (14710489) |  |  | 32543618 |
|  Others | 13221419 | 6364691 | (97415) | (7337998) |  |  | 12150697 |
|  Right-of-use assets | 72426383 | 30479675 | (3497265) | (24028900) |  |  | 75379893 |
|  | 205420354 | 52759008 | (5258140) | (47084686) | 47521151 | 448563 | 253806250 |

---

<sup>1</sup> Others consist of reclassification to investment properties and others.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Depreciation** | **Others <sup>1</sup>** | **Ending<br>balance** |
|  Land | 65263726 |  | (272921) |  | 39017 | 65029822 |
|  Buildings | 24916560 |  | (237867) | (1064308) | (216351) | 23398034 |
|  Furniture and equipment | 28859957 | 16456695 | (12780) | (13959176) |  | 31344696 |
|  Others | 16306646 | 6488104 | (174045) | (9399286) |  | 13221419 |
|  Right-of-use assets | 84964420 | 10037472 | (669858) | (17043285) | (4862366) | 72426383 |
|  | 220311309 | 32982271 | (1367471) | (41466055) | (5039700) | 205420354 |

---

<sup>1</sup> Others consist of reclassification to investment properties and others.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in right-of-use assets for the year ended December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Depreciation** | **Ending<br>balance** |
|  Buildings | 69145814 | 27808891 | (3080026) | (21758887) | 72115792 |
|  Vehicles | 1570194 | 2291705 | (414828) | (1188483) | 2258588 |
|  Others | 1710375 | 379079 | (2411) | (1081530) | 1005513 |
|  | 72426383 | 30479675 | (3497265) | (24028900) | 75379893 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition** | **Disposal** | **Depreciation** | **Others** | **Ending<br>balance** |
|  Buildings | 80952141 | 7777288 | (98178) | (14623072) | (4862365) | 69145814 |
|  Vehicles | 1345888 | 1729628 | (329252) | (1176069) | (1) | 1570194 |
|  Others | 2666391 | 530556 | (242428) | (1244144) |  | 1710375 |
|  | 84964420 | 10037472 | (669858) | (17043285) | (4862366) | 72426383 |

---

The Company applies the revaluation model in relation to the measurement after the initial recognition of the land and the date of revaluation of the land was August 5, 2022. The Company used the assessed price provided by qualified appraiser for the revaluation of the land.

The land was measured using sales value of similar land, and the access condition, environment condition and other specific factors are considered when the value is adjusted. There is no change in the valuation technique for the year ended December 31, 2022.

Classification of land that is measured at fair value by fair value hierarchy levels as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Land |  |  | 111823202 | 111823202 |
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Land |  |  | 65029822 | 65029822 |

---

Changes in land which is classified to Level 3 for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 65029822 | 65263726 |
|  Reclassification to property and equipment | 642447 | 491317 |
|  Reclassification to investment properties | (255137) | (452300) |
|  Disposal | (1115081) | (272921) |
|  Changes in fair-value | 47521151 |  |
|  Ending balance | 111823202 | 65029822 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Book amounts of land under cost model as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Under**<br> **revaluation model** | **Under**<br> **revaluation model** | **Under**<br> **cost model** | **Under**<br> **cost model** | **Under**<br> **revaluation model** | **Under**<br> **revaluation model** | **Under**<br> **cost model** | **Under**<br> **cost model** |
|  Land |  | 111823202 |  | 28242445 |  | 65029822 |  | 29301991 |

---

Changes in other comprehensive income related to the revaluation for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning balance** | **Re-classification** | **Ending balance** |
|  Land | 36132407 | 47900256 | 84032663 |
|  Income tax effects | (10034165) | (12332245) | (22366410) |
|  After income tax | 26098242 | 35568011 | 61666253 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Re-classification** | **Disposal,<br>others** | **Ending balance** |
|  Land | 36517219 | (355466) | (29344) | 36132409 |
|  Income tax effects | (10042235) |  | 8070 | (10034165) |
|  After income tax | 26474984 | (355466) | (21274) | 26098244 |

---

**12. Investment Properties** 

The details of investment properties as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Accumulated<br>revaluation** | **Book amount** |
|  Land | 8799021 |  | (332251) | 8466770 |
|  Buildings | 15303124 | (9110040) |  | 6193084 |
|  | 24102145 | (9110040) | (332251) | 14659854 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>depreciation** | **Accumulated<br>revaluation** | **Book amount** |
|  Land | 10088388 |  | (59929) | 10028459 |
|  Buildings | 17264002 | (9537484) |  | 7726518 |
|  | 27352390 | (9537484) | (59929) | 17754977 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in investment properties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Disposal** | **Depreciation** | **Re-classification** | **Ending<br>balance** |
|  Land | 10028459 | (1174378) |  | (387311) | 8466770 |
|  Buildings | 7726518 | (1053788) | (418394) | (61252) | 6193084 |
|  | 17754977 | (2228166) | (418394) | (448563) | 14659854 |
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Disposal** | **Depreciation** | **Re-classification** | **Ending<br>balance** |
|  Land | 10528899 | (461423) |  | (39017) | 10028459 |
|  Buildings | 8403473 | (450604) | (442702) | 216351 | 7726518 |
|  | 18932372 | (912027) | (442702) | 177334 | 17754977 |

---

Details of income and expenditure on investment properties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Rental income | 1812717 | 1867883 |
|  Expenditure on operating investment properties | (970252) | (808657) |
|  Expenditure on non-operating investment properties | (32508) | (153330) |
|  | 809957 | 905896 |

---

Details of fair value of investment properties as at December 31, 2022 and 2021 are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Book amount** | **Book amount** | **Fair value** | **Fair value** | **Book amount** | **Book amount** | **Fair value** | **Fair value** |
|  Land |  | 8466770 |  | 47402527 |  | 10028459 |  | 26789618 |
|  Buildings |  | 6193084 |  | 8444966 |  | 7726518 |  | 10963771 |
|  |  | 14659854 |  | 55847493 |  | 17754977 |  | 37753389 |

---

The fair values of investment properties as at December 31, 2022 was evaluated by an independent appraiser, based on the evaluation result at August 5, 2022. The qualified appraiser is a member of the Korea Appraisers Association and has appropriate qualifications and experience in evaluating real estate in the location of investment properties. This evaluation was based on international evaluation standards and is based on the market price of similar real estate.

The fair values of investment properties are classified as Level 3 based upon the inputs, which are used in valuation method.

The fair value of investment property measured by using sales value of similar land is calculated by analyzing and comparing the sale prices of similar land, and also the access condition, environment condition and other specific factors for the purpose of estimation for fair value are considered. There is no significant change in the valuation technique for the year ended December 31, 2022.

Investment properties are provided as collaterals for rental deposits and lease hold right, which amount to W 610,000 thousand and W 938,000 thousand as at December 31, 2022 and 2021, respectively.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**13. Intangible Assets** 

The details of intangible assets as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Acquisition cost** | **Accumulated<br>amortization** | **Accumulated<br>impairment** | **Book amount** |
|  Goodwill | 58888990 |  |  | 58888990 |
|  Development costs | 186869610 | (139522251) |  | 47347359 |
|  Software | 117345440 | (89018725) |  | 28326715 |
|  Memberships | 37615266 | (115840) | (9866646) | 27632780 |
|  Others | 23294717 |  |  | 23294717 |
|  | 424014023 | (228656816) | (9866646) | 185490561 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Acquisition<br>cost** | **Accumulated<br>amortization** | **Accumulated<br>impairment** | **Book amount** |
|  Goodwill | 58888990 |  |  | 58888990 |
|  Development costs | 157728819 | (122075492) |  | 35653327 |
|  Software | 104393859 | (78917824) |  | 25476035 |
|  Memberships | 36920748 | (98188) | (9242252) | 27580308 |
|  Others | 23294717 |  |  | 23294717 |
|  | 381227133 | (201091504) | (9242252) | 170893377 |

---

The changes in intangible assets for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition <sup>1</sup>** | **Disposal** | **Amortization** | **Impairment <sup>2</sup>** | **Reversal of<br>Impairment <sup>3</sup>** | **Ending<br>balance** |
|  Goodwill | 58888990 |  |  |  |  |  | 58888990 |
|  Development costs | 35653327 | 29140791 |  | (17446759) |  |  | 47347359 |
|  Software | 25476035 | 12951582 |  | (10100902) |  |  | 28326715 |
|  Memberships | 27580308 | 1745855 | (1041665) | (17652) | (1028751) | 394684 | 27632780 |
|  Others | 23294717 |  |  |  |  |  | 23294717 |
|  | 170893377 | 43838228 | (1041665) | (27565313) | (1028751) | 394684 | 185490561 |

---

<sup>1</sup> Advance payments and others transferred from other accounts are included.

<sup>2</sup> Memberships are composed of condominium and golf memberships, which are intangible assets with indefinite useful lives. The Company recognized a impairment loss because the market price of the asset is lower than book amount as at December 31, 2022. 

<sup>3</sup> Memberships are composed of condominium and golf memberships, which are intangible assets with indefinite useful lives. The Company recognized a reversal of impairment loss because the market price of the asset is higher than book amount as at December 31, 2022. 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Acquisition <sup>1</sup>** | **Disposal** | **Amortization** | **Impairment <sup>2</sup>** | **Reversal of<br>Impairment <sup>3</sup>** | **Ending<br>balance** |
|  Goodwill | 58888990 |  |  |  |  |  | 58888990 |
|  Development costs | 32176319 | 17915813 |  | (14438805) |  |  | 35653327 |
|  Software | 14502908 | 18665072 |  | (7691945) |  |  | 25476035 |
|  Memberships | 27212997 |  | (2124080) | (17652) | (121016) | 2630059 | 27580308 |
|  Others | 23294717 |  |  |  |  |  | 23294717 |
|  | 156075931 | 36580885 | (2124080) | (22148402) | (121016) | 2630059 | 170893377 |

---

<sup>1</sup> Advance payments and others transferred from other accounts are included.

<sup>2</sup> Memberships are composed of condominium and golf memberships, which are intangible assets with indefinite useful lives. The Company recognized a impairment loss because the market price of the asset is lower than book amount as at December 31, 2021. 

<sup>3</sup> Memberships are composed of condominium and golf memberships, which are intangible assets with indefinite useful lives. The Company recognized a reversal of impairment loss because the market price of the asset is higher than book amount as at December 31, 2021. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**14. Other Financial Assets** 

The details of other financial assets as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Other receivables | 2262695642 | 3271464715 |
|  Accrued income | 190160953 | 163484093 |
|  Accrued interest on bonds | 148382124 | 209164728 |
|  Guarantee deposits | 67571758 | 67557208 |
|  Other | 67835435 | 49579114 |
|  Provision for other financial assets | (37655617) | (36353781) |
|  | 2698990295 | 3724896077 |

---

**15. Other Assets** 

The details of other assets as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Other receivables |  | 116417803 |  | 84740 |
|  Advance payments |  | 47263896 |  | 23376946 |
|  Prepaid expenses |  | 75560143 |  | 7437538 |
|  Prepaid value-added taxes |  | 786782 |  | 24513 |
|  Others |  | 3648511 |  | 441283 |
|  |  | 243677135 |  | 31365020 |

---

**16. Deposit Liabilities** 

The details of deposit liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Customers' deposits** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for brokerage | 5049354662 | 6640427057 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for exchange-traded derivatives trading | 779295471 | 599962498 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for subscription | 904010 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for savings | 6445014 | 8609240 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for repo | 61600 | 61627 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Customers' deposits for the investor of collective investment securities | 324357905 | 223800663 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 48641 | 48729 |
|  | 6160467303 | 7472909814 |
|  **Guarantee deposits** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantee deposits in foreign currency | 190255947 | 474568902 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantee deposits in won currency | 468648375 | 452889714 |
|  | 658904322 | 927458616 |
|  | 6819371625 | 8400368430 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**17. Borrowings** 

The details of borrowings as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Call money | 830000000 | 40000000 |
|  Borrowings: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowing from banks |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowing from KSFC | 1244222242 | 1093096057 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Asset-backed short-term bonds | 1254200000 | 515000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CP borrowings | 1920000000 |  |
|  Securities sold under repurchase agreements | 6231390409 | 13531208950 |
|  Short-term note issued | 7249429201 | 4475145330 |
|  Debentures: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | 1850190000 | 2345650000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less: discount on debentures issued | (3764611) | (5470519) |
|  | 20575667241 | 21994629818 |

---

The details of call money as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Interest rate (%)** | **2022** | **2021** |
|  Samsung Asset Management Co., Ltd. and others | 3.42~5.05 | 830000000 | 40000000 |

---

The details of borrowings as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* |  | **Interest rate (%)** | **2022** | **2021** |
|  Borrowings from KSFC | KSFC | 3.45~5.07 | 1244222242 | 1093096057 |
|  Asset-backed short-term bonds | Hi Investment & Securities Co., Ltd.<br> and others | 3.42~5.81 | 1254200000 | 515000000 |
|  CP borrowings | Hana Securities Co., Ltd.<br> and others | 3.76~5.99 | 1920000000 |  |
|  |  |  | 4418422242 | 1608096057 |

---

The details of securities sold under repurchase agreements as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Interest rate (%)** | **2022** | **2021** |
|  Customers | 0.11~4.60 | 4181390409 | 6973309166 |
|  Financial institution | 3.30~4.30 | 2050000000 | 6557899784 |
|  |  | 6231390409 | 13531208950 |

---

The details of short-term note issued as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Interest rate (%)** | **2022** | **2021** |
|  Individual | 0.25~5.60 | 4650359585 | 1724366358 |
|  Corporate | 1.15~5.50 | 2599069616 | 2750778972 |
|  |  | 7249429201 | 4475145330 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The details of debentures as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Date issued** | **Maturity** | **Interest rate (%)** | **2022** | **2021** |
|  The 34-2nd unsecured public debenture | 2018.3.9 | 2023.3.9 | 3.02 | 210000000 | 210000000 |
|  The 36-1st unsecured public debenture | 2019.4.18 | 2022.4.18 |  |  | 250000000 |
|  The 36-2nd unsecured public debenture | 2019.4.18 | 2024.4.18 | 2.09 | 250000000 | 250000000 |
|  The 37-1st unsecured public debenture | 2019.6.14 | 2022.6.14 |  |  | 100000000 |
|  The 37-2nd unsecured public debenture | 2019.6.14 | 2024.6.14 | 1.80 | 150000000 | 150000000 |
|  The 38-1st unsecured public debenture | 2020.6.11 | 2022.6.10 |  |  | 170000000 |
|  The 38-2nd unsecured public debenture | 2020.6.11 | 2023.6.9 | 1.54 | 130000000 | 130000000 |
|  The 39-1st unsecured public debenture | 2021.3.4 | 2024.3.4 | 1.31 | 110000000 | 110000000 |
|  The 39-2nd unsecured public debenture | 2021.3.4 | 2026.3.4 | 1.70 | 120000000 | 120000000 |
|  The 40-1st unsecured public debenture | 2021.4.23 | 2024.4.23 | 1.53 | 300000000 | 300000000 |
|  The 40-2nd unsecured public debenture | 2021.4.23 | 2026.4.23 | 1.94 | 200000000 | 200000000 |
|  The 21-1 public debenture in foreign currency <sup>1</sup> | 2021.11.1 | 2026.11.1 | 2.13 | 380190000 | 355650000 |
|  Less: Discount on debentures issued |  |  |  | (3764611) | (5470519) |
|  |  |  |  | 1846425389 | 2340179481 |

---

<sup>1</sup> The issuance price of this public debenture is US$300,000,000. 

The changes in borrowings for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 21994629818 | 22507306458 |
|  Increase(decrease) in call money | 790000000 | (250000000) |
|  Increase(decrease) in borrowings from banks |  | (2787298) |
|  Increase(decrease) in borrowings from KSFC | 151126185 | (256903943) |
|  Increase in asset-backed short-term bonds | 739200000 | 175000000 |
|  Increase in CP borrowings | 1920000000 |  |
|  Increase(decrease) in securities sold under repurchase agreements | (7299818541) | (1462985663) |
|  Increase in short-term note issued | 2774283871 | 742417752 |
|  Increase in debentures | (493754092) | 542582512 |
|  Ending balance | 20575667241 | 21994629818 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**18. Post-employment Benefits** 

**18.1 Defined Benefit Plans** 

The details of defined benefit liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Present value of defined benefit obligations | 67247328 | 70914622 |
|  Fair value of plan assets | (12430101) | (15294733) |
|  Net defined benefit liabilities | 54817227 | 55619889 |

---

The changes in the defined benefit obligation for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 70914622 | 72288500 |
|  Current service cost | 21836961 | 18145235 |
|  Interest cost | 1151821 | 780607 |
|  Past service cost | 2910304 | 1315190 |
|  Remeasurements: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Actuarial gains and losses arising from changes in demographic assumptions | (6811193) | 20113645 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Actuarial gains and losses arising from changes in financial assumptions | (13735991) | (1706991) |
|  Actuarial gains and losses arising from experience adjustments | 16604753 | (15407457) |
|  Payments from plans: | (8301323) | (1416118) |
|  Payments from the Company | (17440714) | (14513685) |
|  Transfer from related companies | 2438158 | 1823363 |
|  Transfer to related companies | (370486) | (895469) |
|  Settlement | (78335) | (5301320) |
|  Gain or loss on settlement | (1871249) | (4310878) |
|  Ending balance | 67247328 | 70914622 |

---

The changes in the fair value of plan assets for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | (15294733) | (18652077) |
|  Interest income | (178723) | (204480) |
|  Remeasurements: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Return on plan assets (excluding amounts included in interest income) | 157107 | 87124 |
|  Contributions by employers | (3347402) | (2297614) |
|  Payments from plans: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Benefits paid | 8301323 | 1416118 |
|  Settlement |  | 5284090 |
|  Transfer from related companies | (2438159) | (1823363) |
|  Transfer to related companies | 370486 | 895469 |
|  Ending balance | (12430101) | (15294733) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Plan assets are composed of the detail assets that have no quoted price in active market. The details of plan assets as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Fair value** | **Composition(%)** | **Fair value** | **Composition(%)** |
|  Cash and deposits | 8853577 | 71.23 | 9539927 | 62.37 |
|  Investment funds | 3576524 | 28.77 | 2327801 | 15.22 |
|  Derivatives |  |  | 3427005 | 22.41 |
|  | 12430101 | 100.00 | 15294733 | 100.00 |

---

Key actuarial assumptions used as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
|  | **2022** | **2021** |
| Discount rate | DB (including special retirement by<br>salaries peak plan) 5.1%,<br>Compensation promotion DC 5.0% | DB (including special retirement by<br>salaries peak plan) 2.5%,<br>Compensation promotion DC 2.3% |
| Expected salary growth rate | DB : executives 0%<br> DC: Promotion + Base up: 2.3%,<br>Special retirement by Salaries peak plan : 4.6% | DB : executives 0%<br> DC: Promotion + Base up <br>(December 31, 2021 : 2.3%, <br>After December 31, 2022 : 2.0%)<br> Special retirement by salaries peak plan : January 1<sup>st</sup>, 2022 : 4.6%(2.3% + Promotion added 2.3%)<br> After January 1<sup>st</sup>, 2023 : 4.3% (2.0% + Promotion added 2.3%) |

---

The sensitivity analysis for significant actuarial assumptions used to determine the present value of the defined benefit obligation as at December 31, 2022, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Effect on the present value of defined benefit obligation** | **Effect on the present value of defined benefit obligation** | **Effect on the present value of defined benefit obligation** |
| *(in thousands of Korean won)* | **Changes in<br>assumption** | **Increase** | **Decrease** |
|  Discount rate | 0.50% | (1609503) | 1705619 |
|  Expected salary growth rate<sup>1</sup> | 0.50% | 1631234 | (1544704) |
|  Retirement rate | 0.50% | (1238827) | 1303693 |

---

<sup>1</sup> The sensitivity analysis for the expected salary growth rate is limited to special retirement by salaries peak plan and DB.

The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. The sensitivity of the present value of the defined benefit obligation to changes in actuarial assumptions is calculated using the projected unit credit method, the same method applied when calculating the defined benefit obligations.

The methods and assumptions used in preparing the sensitivity analyses did not change compared to the previous period.

*The effect of defined benefit plan on future cash inflows* 

Expected maturity analysis of undiscounted pension benefits as at December 31, 2022, is as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Less than 1<br>year <sup>1</sup>** | **Between 1<br>and 2 years** | **Between 2<br>and 5 years** | **Between 5<br>and 10 years** | **Over 10<br>years** | **Total** |
|  Pension benefits<sup>1</sup> | 5066411 | 6379701 | 24686972 | 30520116 | 71780706 | 138433906 |

---

<sup>1</sup> Fixed pension benefits of W 14.1 billion under promotion compensation defined contribution plan is excluded.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The weighted average duration of the defined benefit obligations is 5.79 years.

Expected contribution to post-employment benefit plans for the year ending December 31, 2023 are W 1,241,430 thousand.

**18.2 Defined Contribution Plans** 

The Company recognized the expenses of W 9,212,523 thousand and W 5,766,377 thousand for defined contribution plans for the years ended December 31, 2022 and 2021, respectively.

**19. Provisions** 

The details of provisions as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Provisions for non-financial guarantees | 1456106 | 1680410 |
|  Provisions for asset retirement obligation<sup>1</sup> | 8802261 | 7997559 |
|  Provisions for lawsuits | 51221194 | 25150111 |
|  Provisions for the points |  | 2569985 |
|  Provisions for others | 89454890 | 68700000 |
|  | 150934451 | 106098065 |

---

<sup>1</sup> The Company recognized the provision for asset retirement obligation in connection with the leased asset for the expenditures expected to recover the asset.

The changes in provisions for non-financial guarantees for the years ended December 31, 2022 and 2021 are as follows,

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** |
|  | **The financial<br>instruments<br>applying 12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** |
|  | **The financial<br>instruments<br>applying 12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** |
|  Beginning | 1642264 | 38146 |  |
|  Provision for losses (Reversal of provision) | (418773) | 194211 |  |
|  Other transfer (foreign exchange and other) | 258 |  |  |
|  Ending | 1223749 | 232357 |  |

---

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** |
|  | **The financial<br>instruments<br>applying 12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** |
|  | **The financial<br>instruments<br>applying 12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** |
|  Beginning | 1342023 |  |  |
|  Transfer between stages |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to lifetime expected credit losses (non-impaired) | (23238) | 23238 |  |
|  Provision for losses (Reversal of provision) | 323273 | 14908 |  |
|  Other transfer (foreign exchange and other) | 206 |  |  |
|  Ending | 1642264 | 38146 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The changes in other provisions for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Provisions<br>for asset<br>retirement<br>obligation** | **Provisions<br>for lawsuits** | **Provisions for<br>the points** | **Provisions for<br>others** | **Total** |
|  Beginning | 7997559 | 25150111 | 2569985 | 68700000 | 104417655 |
|  Contribution <sup>1</sup> | 1026723 | 25165908 | 2451694 | 33965528 | 62609853 |
|  Reversal |  |  |  | (4038034) | (4038034) |
|  Use | (423495) | (1229477) | (2788799) | (7037952) | (11479723) |
|  Amortization of discounts | 201474 |  |  |  | 201474 |
|  Other <sup>2</sup> |  | 2134652 | (2232880) | (2134652) | (2232880) |
|  Ending | 8802261 | 51221194 |  | 89454890 | 149478345 |

---

<sup>1</sup> As the first-instance verdict of relevant trial was announced after the reporting period, additional litigation provision liabilities were recognized as an adjusting event after the reporting period.

<sup>2</sup> As a lawsuit was filed during the year ended December 31, 2022, the estimated loss on the sale of funds related to Lime Asset Management was replaced to provisions for lawsuits.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Provisions<br>for asset<br>retirement<br>obligation** | **Provisions<br>for lawsuits** | **Provisions for<br>the points** | **Provisions for<br>others** | **Total** |
|  Beginning | 8114793 | 10643375 | 2205019 | 60565500 | 81528687 |
|  Contribution | 57684 | 8892 | 4520637 | 36700000 | 41287213 |
|  Use | (304037) | (206240) | (4155671) | (13861416) | (18527364) |
|  Amortization of discounts | 129119 |  |  |  | 129119 |
|  Other <sup>1</sup> |  | 14704084 |  | (14704084) |  |
|  Ending | 7997559 | 25150111 | 2569985 | 68700000 | 104417655 |

---

<sup>1</sup> As a lawsuit was filed during the year ended December 31, 2021, the estimated loss on the sale of funds related to Lime Asset Management was replaced to provisions for lawsuits.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**20. Other Financial Liabilities** 

The details of other financial liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Other payables | 1944408865 | 3037222814 |
|  Accrued expenses | 94964650 | 40961608 |
|  Financial guarantee liabilities | 57125511 | 97766009 |
|  Provisions for financial guarantee contracts | 16577411 | 2959848 |
|  Leasehold deposits received | 7940809 | 7319921 |
|  Lease liabilities | 121082291 | 123400384 |
|  Other | 1473378 | 1117510 |
|  | 2243572915 | 3310748094 |

---

The changes in liabilities of the provisions for financial guarantee contracts for the years ended December 31, 2022 and 2021 are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2022** |
|  | **The financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** |
|  | **The financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** |
|  Beginning | 1772389 | 1187459 |  |
|  Provision | 13212104 | 405459 |  |
|  Ending | 14984493 | 1592918 |  |

---

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** | **2021** |
|  | **The financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** |
|  | **The financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** |
|  Beginning | 443598 | 2586561 |  |
|  Provision for losses (Reversal of provision) | 1328791 | (1399102) |  |
|  Ending | 1772389 | 1187459 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**21. Other Liabilities** 

The details of other liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Account payables | 31630 | 43216188 |
|  Accrued expenses | 179569071 | 258774213 |
|  Accrued dividends | 2952757 |  |
|  Advances from customers | 5355119 | 4615843 |
|  Unearned revenue | 185683671 | 52220555 |
|  Taxes withheld | 42772294 | 32002782 |
|  Other long-term employee benefits | 7176237 | 7630850 |
|  Others | 3783577 | 3826567 |
|  | 427324356 | 402286998 |

---

**22. Share Capital** 

The details of share capital as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won,*<br> *except per share)* | **Authorized shares** | **Authorized shares** | **Outstanding shares** | **Outstanding shares** | **Par value**<br> **per share** | **Par value**<br> **per share** | **2022** | **2022** | **2021** | **2021** |
|  Ordinary share |  | 1,000,000,000 shares |  | 298,620,424 shares |  | 5,000 won |  | 1493102120 |  | 1493102120 |

---

There are no changes in ordinary shares for the years ended December 31, 2022 and 2021.

**23. Hybrid Securities** 

Details of hybrid security classified as equity as of December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Issuance**<br> **date** | **Maturity** | **Interest rate<br>(%)** | **2022** | **2021** |
|  Bond-type Hybrid Securities No.1<sup>1</sup> | March 31, 2022 | Permanent | 4.30 | 208010752 |  |
|  Bond-type Hybrid Securities No.2 | May 30, 2022 | Permanent | 4.80 | 48170780 |  |
|  Bond-type Hybrid Securities No.3 <sup>2</sup> | September 30, 2022 | Permanent | 5.50 | 249948780 |  |
|  |  |  |  | 506130312 |  |

---

<sup>1</sup> As at December 31, 2022, among the hybrid securities issued by the Company, the balance held by KB Financial Group, a related party of the Company, is W 200,000 million.

<sup>2</sup> As at December 31, 2022, among the hybrid securities issued by the Company, the balance held by KB Financial Group, a related party of the Company, is W 230,000 million.

The Company may extend the maturity under the same conditions at the time of maturity of the above hybrid securities, and interest payment may be deferred if certain conditions are met. Above hybrid securities are early redeemable by the Company after 5 years from the issuance date and each interest payment date thereafter.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**24. Other Paid-in Capital** 

The details of other paid-in capital as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Share premium <sup>1</sup> | 1142353750 | 1142353750 |
|  Gains and losses on sale of treasury share | (45331811) | (45331811) |
|  Other equity <sup>2</sup> | 382088147 | 382088147 |
|  | 1479110086 | 1479110086 |

---

<sup>1</sup> Share premium was previously paid from stock issuance and new stock issuance due to merger and can only be used for capitalization and deficit recovery.

<sup>2</sup> Other equity arose from the paid-in capital increase of preferred share and gains on merger.

There are no changes in other paid-in capital for the years ended December 31, 2022 and 2021.

**25. Retained Earnings** 

The details of retained earnings as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Legal reserve |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Earned surplus reserve <sup>1</sup> | 128656298 | 101656298 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reserve for liability to compensate for damages <sup>2</sup> | 500000 | 500000 |
|  Voluntary reserves | 1839996357 | 1540948010 |
|  Regulatory reserve for credit losses <sup>3</sup> | 101842161 | 100223524 |
|  Unappropriated retained earnings | (32922732) | 527666984 |
|  | 2038072084 | 2270994816 |

---

<sup>1</sup> The Commercial Act of the Republic of Korea requires the Company to appropriate, as a legal reserve, an amount equal to a minimum of 10% of cash dividends paid until such reserve equals 50% of its issued share capital. The reserve is not available for the payment of cash dividends, but may be transferred to share capital or used to reduce accumulated deficit. 

<sup>2</sup> The Company provides reserve for loss on electronic financial transactions to make reparation for the damage in process of the electronic transfers or operations. Also, the Company provides reserve to compensate for inflicted damage on a credit information subject when violating the Credit Information Use and Protection Act. 

<sup>3</sup> The Company accumulates allowances for possible loan losses in accordance with Korean IFRS and reserve for possible loan losses as much as the amount below the provision of allowances according to minimum accumulation ratio required by Financial Supervisory Service. 

Changes in retained earnings for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 2270994816 | 1873327832 |
|  Profit for the year | 170294956 | 597645711 |
|  Dividends | (400000000) | (200000000) |
|  Dividends of hybrid securities | (3479007) |  |
|  Transfer to gain due to disposal of revaluation assets | 261319 | 21273 |
|  Ending balance | 2038072084 | 2270994816 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The amount of dividends and dividends per share for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in Korean won*<br> *and number of shares)* | **Type of<br>share** | **Number of<br>shares<br>outstanding** | **Number of<br>treasury**<br> **shares** | **Number of<br>dividend<br>shares** | **Dividend<br>per share** | **Total dividend**<br> **(In thousands of**<br> **Korean won)** |
|  Interim dividend | Ordinary<br>share | 298,620,424<br>shares |  | 298,620,424<br> shares | 669 | 200000000 |
|  Annual dividend | Ordinary<br>share | 298,620,424<br>shares |  | 298,620,424<br> shares | 669 | 200000000 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in Korean won*<br> *and number of shares)* | **Type of<br>share** | **Number of<br>shares<br>outstanding** | **Number of<br>treasury**<br> **shares** | **Number of<br>dividend<br>shares** | **Dividend<br>per share** | **Total dividend**<br> **(In thousands of<br>Korean won)** |
|  Interim dividend | Ordinary<br>share | 298,620,424<br>shares |  | 298,620,424<br> shares | 234 | 70000000 |
|  Annual dividend | Ordinary<br>share | 298,620,424<br>shares |  | 298,620,424<br> shares | 435 | 130000000 |

---

Appropriation of retained earnings for the years ended December 31, 2022 and 2021, consists of:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | (Expected date of appropriation:<br>March 23, 2023) | (Expected date of appropriation:<br>March 23, 2023) | (Date of appropriation:<br>March 24, 2022) | (Date of appropriation:<br>March 24, 2022) |
|  Unappropriated retained earnings |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Balance at the beginning of year |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes of accounting policies |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interim dividend | (200000000) |  | (70000000) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends of hybrid securities | (3479007) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer due to disposal of revaluation assets | 261319 |  | 21274 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit for the year | 170294956 | (32922732) | 597645711 | 527666985 |
|  Transfers such as discretionary reserves |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Regulatory reserve for credit losses | 1526732 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Voluntary reserves | 161396000 | 162922732 |  |  |
|  |  | 130000000 |  | 527666985 |
|  Appropriation of retained earnings |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Earned surplus reserve | 30000000 |  | 27000000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Regulatory reserve for credit losses |  |  | 1618637 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Voluntary reserves |  |  | 299048348 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends | 100000000 | 130000000 | 200000000 | 527666985 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (cash dividends per ordinary share: W 334 (6.69%) in 2022) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (cash dividends per ordinary share: W 669 (13.39%) in 2021) |  |  |  |  |
|  Unappropriated retained earnings carried forward to subsequent year |  |  |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Payout and dividend yield ratios as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
|  | **Ordinary**<br> **share** | **Ordinary**<br> **share** | **Ordinary**<br> **share** | **Ordinary**<br> **share** |
|  | Interim dividend | Annual dividend | Interim dividend | Annual dividend |
|  Number of shares outstanding | 298,620,424<br> shares | 298,620,424<br> shares | 298,620,424<br> shares | 298,620,424<br> shares |
|  Number of treasury shares |  |  |  |  |
|  Number of dividend shares | 298,620,424<br> shares | 298,620,424<br> shares | 298,620,424<br> shares | 298,620,424<br> shares |
|  Par value per share (in Korean won) | 5000 | 5000 | 5000 | 5000 |
|  Payout ratio | 13.39% | 6.69% | 4.68% | 13.39% |
|  Scheduled dividends (in thousands of Korean won) | 200000000 | 100000000 | 70000000 | 200000000 |
|  Dividends per share (in Korean won) | 669 | 334 | 234 | 669 |

---

The Company accumulates allowances for possible loan losses in accordance with Korean IFRS and reserve for possible loan losses as much as the amount below the provision of allowances according to minimum accumulation ratio required by Regulation on Supervision of Financial Investment.

Regulatory reserve for credit losses, a type of voluntary reserve for retained earnings, reverses the exceeding amount if the beginning balance of the reserve exceeds the ending balance at the closing date. Regulatory reserve for credit losses is generally recognized after unappropriated deficit is disposed.

The details of the regulatory reserve for credit losses (reversal of reserve) to be appropriated as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning | 101842161 | 100223524 |
|  Amounts to be reserved (reversed) | (1526732) | 1618637 |
|  Ending | 100315429 | 101842161 |

---

The adjusted profit of the year after reflection of reserve for credit losses for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Profit for the year before reserve for credit loss | 170294956 | 597645711 |
|  Amounts to be reversed (reserved) | 1526732 | (1618637) |
|  Adjusted profit after reversal (provision) of reserve for credit losses<sup>1</sup> | 171821688 | 596027074 |

---

<sup>1</sup> Reserve for credit loss is announced by Article 3 Clause 8 of the Regulation on Financial Investment Business. Adjusted profit after reserve for credit losses is not based on Korean IFRS and is calculated on the assumption that provision or reversal of reserve for credit losses before tax is adjusted to the profit. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**26. Other Components of Equity** 

The details of other components of equity as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Changes in the fair value of financial assets at FVOCI | 233760812 | 216494145 |
|  Revaluation surplus | 62060360 | 26749635 |
|  Remeasurements of net defined benefit liabilities | (37778107) | (40522467) |
|  Gain or loss on financial liabilities designated at FVTPL due to the change of credit risk | 41080867 | 2225784 |
|  | 299123932 | 204947097 |

---

The changes in gain or loss on valuation of financial assets at FVOCI for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 216494145 | 205927502 |
|  Gain on valuation | 11241986 | 17339966 |
|  Tax effect of gain (loss) on valuation <sup>1</sup> | (39698) | (4768491) |
|  Transfer to gain (loss) due to disposal or impairment | 8187321 | (2765286) |
|  Tax effect of transfer <sup>1</sup> | (2122942) | 760454 |
|  Ending balance | 233760812 | 216494145 |

---

<sup>1</sup> Including income tax effect (Note 35).

The changes in gain on revaluation of property and equipment for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 26749635 | 26770909 |
|  Net gains on revaluation of property and equipment | 47900256 |  |
|  Tax effect of net gains on revaluation <sup>1</sup> | (12328212) |  |
|  Transfer to retained earnings due to disposal of revaluation assets | (261319) | (21274) |
|  Ending balance | 62060360 | 26749635 |

---

<sup>1</sup> Including income tax effect (Note 35).

The changes in remeasurements of the net defined benefit liability for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | (40522467) | (38284884) |
|  Changes during the year | 3785324 | (3086321) |
|  Tax effect <sup>1</sup> | (1040964) | 848738 |
|  Ending balance | (37778107) | (40522467) |

---

<sup>1</sup> Including income tax effect (Note 35).

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The change in gain or loss on financial liabilities designated at FVTPL due to the change of credit risk for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Beginning balance | 2225784 | (11488824) |
|  Changes during the year | 52822290 | 18916700 |
|  Tax effect <sup>1</sup> | (13967207) | (5202092) |
|  Ending balance | 41080867 | 2225784 |

---

<sup>1</sup> Including income tax effect (Note 35).

**27. Fee and Commission Income and Expense** 

The details of fee and commission income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Brokerage commissions | 414015645 | 707045069 |
|  Underwriting commissions | 167839908 | 128888234 |
|  Brokerage commissions on collective investment securities | 19850174 | 28155111 |
|  Management fee on asset management | 27285178 | 32036202 |
|  Commissions on merger and acquisition | 130161016 | 134615127 |
|  Trust fees and commissions | 17996232 | 14581037 |
|  Other commissions | 144662369 | 121762248 |
|  | 921810522 | 1167083028 |

---

The details of fee and commission expense for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Trading commission | 48429891 | 58391360 |
|  Advisory fees | 1664749 | 1967202 |
|  Investment management delegation fees | 239715 | 183377 |
|  Commission fees on group brand | 15634928 | 18459525 |
|  Contributions to other institutions | 8093205 | 7593876 |
|  Others | 92315789 | 84654029 |
|  | 166378277 | 171249369 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**28. Gain or Loss on Valuation and Disposal of Financial Instruments** 

The details of gain or loss on valuation and disposal of financial instruments for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Financial instruments at FVTPL | 1300472857 | 2016946613 | (716473756) |
|  Financial instruments designated at FVTPL | 1188229550 | 429243880 | 758985670 |
|  Derivative financial instruments | 8135153253 | 8534426565 | (399273312) |
|  Financial assets at FVOCI <sup>1</sup> | 525431 | 16448205 | (15922774) |
|  | 10624381091 | 10997065263 | (372684172) |

---

<sup>1</sup> Gain or loss on valuation of financial assets at FVOCI is excluded.

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Financial instruments at FVTPL | 1162211517 | 1275824696 | (113613179) |
|  Financial instruments designated at FVTPL | 625254719 | 654985522 | (29730803) |
|  Derivative financial instruments | 3732757673 | 3604045185 | 128712488 |
|  Financial assets at FVOCI <sup>1</sup> | 4513829 | 15923820 | (11409991) |
|  | 5524737738 | 5550779223 | (26041485) |

---

<sup>1</sup> Gain or loss on valuation of financial assets at FVOCI is excluded.

The details of gain or loss on valuation and disposal of financial instruments at FVTPL for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Financial assets at FVTPL | 1189377822 | 1954324119 | (764946297) |
|  Financial liabilities at FVTPL | 111095035 | 62622494 | 48472541 |
|  | 1300472857 | 2016946613 | (716473756) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Financial assets at FVTPL | 1091448161 | 1195909031 | (104460870) |
|  Financial liabilities at FVTPL | 70763356 | 79915665 | (9152309) |
|  | 1162211517 | 1275824696 | (113613179) |

---

The details of gain or loss on valuation and disposal of financial instruments designated at FVTPL for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  **Financial liabilities designated at FVTPL** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives-linked securities sold | 914565927 | 359592452 | 554973475 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other OTC derivative-combined contract sold | 244528092 | 52797971 | 191730121 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange traded notes sold | 29135531 | 16853457 | 12282074 |
|  | 1188229550 | 429243880 | 758985670 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  **Financial liabilities designated at FVTPL** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives-linked securities sold | 573754517 | 567589577 | 6164940 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other OTC derivative-combined contract sold | 45436321 | 80650312 | (35213991) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange traded notes sold | 6063881 | 6745633 | (681752) |
|  | 625254719 | 654985522 | (29730803) |

---

The details of gain or loss on valuation and disposal of derivative financial instruments for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Interest rate | 4485897307 | 4273096366 | 212800941 |
|  Currency | 1560403367 | 1434696665 | 125706702 |
|  Stock | 1934335781 | 2444365562 | (510029781) |
|  Credit | 38991621 | 31943503 | 7048118 |
|  Commodity | 33575544 | 30167440 | 3408104 |
|  Others | 81949633 | 320157029 | (238207396) |
|  | 8135153253 | 8534426565 | (399273312) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Interest rate | 1324289219 | 1263279444 | 61009775 |
|  Currency | 636273231 | 553099242 | 83173989 |
|  Stock | 1585739354 | 1585671006 | 68348 |
|  Credit | 20146569 | 13981328 | 6165241 |
|  Commodity | 21864231 | 14815335 | 7048896 |
|  Others | 144445069 | 173198830 | (28753761) |
|  | 3732757673 | 3604045185 | 128712488 |

---

The details of gain or loss on valuation and disposal of financial assets at FVOCI for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Debt instruments | 525431 | 16448205 | (15922774) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gain** | **Loss** | **Net** |
|  Debt instruments | 4513829 | 15923820 | (11409991) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

As at December 31, 2022, the Company holds PIS(Portfolio Index Swap) in connection with Lime Tethys Qualified Investor Private Investment Trust No. 2 and Lime Pluto FI Qualified Investor Private Investment Trust D-1, which were prohibited to repurchase in the fourth quarter of 2019. The Company holds beneficiary certificates and TRS contracts of W 163.1 billion (nominal amount). Meanwhile, the Company sold W 68.1 billion in subsidiary funds of the fund.

On October 20, 2020, Lime Asset Management's license as a fund manager was revoked by the Financial Supervisory Service's sanctions review committee, and most of its redemption-suspended funds and normal funds will be transferred to Wellbridge Asset Management (the bridge management company) to continue collecting and distributing investments. It is difficult to predict whether and when the aforementioned redemption-suspended funds will be redeemed. As of December 31, 2022, 4 lawsuits were filed to the Company as a defendant and the Company recognizes provisions for lawsuits for the estimated losses due to the possibility of additional lawsuits being filed in the future.

**29. Interest Income and Interest Expense** 

The details of interest income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Interest on financial assets at FVTPL |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on debt instruments at FVTPL | 393096129 | 341201835 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on loans at FVTPL | 4189123 | 6773305 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on commercial papers | 142422181 | 52496923 |
|  | 539707433 | 400472063 |
|  Interest on financial assets at FVOCI and financial assets measured at amortised cost |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on loans measured at amortised cost | 4129316 | 3469282 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on debt instruments at FVOCI | 76499887 | 47099927 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on broker's loans | 199259024 | 204101340 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on loans | 130220677 | 53326130 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on deposits with KSFC | 9784119 | 1834470 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on certificates of deposit |  | 12974 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on deposits with financial institution | 26600 | 5560 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on bonds purchased under resale agreements | 16034415 | 3909987 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on transactions of certificates of deposits | 51521 | 43948 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on deposits | 21546272 | 14874588 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest on other receivables | 1006503 | 2013586 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others <sup>1</sup> | 15193910 | 6388935 |
|  | 473752244 | 337080727 |
|  | 1013459677 | 737552790 |

---

<sup>1</sup> Interest on lease receivables of W 1,084 million and W 1,616 million for the year ended December 31, 2022 and 2021, respectively, are included.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The details of interest expense for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Interest on borrowings | 35798927 | 15698640 |
|  Interest on customers' deposits | 32178353 | 6634860 |
|  Interest on bonds sold under repurchase agreements | 171398994 | 91025829 |
|  Losses on transactions of certificates of deposit | 76 | 619 |
|  Interest on call money | 12644133 | 3045203 |
|  Interest on debentures | 41716419 | 41745311 |
|  Interest on short-term note issued | 163134122 | 43200628 |
|  Interest on asset-backed short-term bonds | 39622114 | 7351150 |
|  Fees for the proceeds from the sale of stocks loaned | 2466 | 1191 |
|  Others <sup>1</sup> | 5118033 | 3725794 |
|  | 501613637 | 212429225 |

---

<sup>1</sup> Interest on lease liabilities of W 3,373 million and W 2,787 million for the year ended December 31, 2022 and 2021, respectively, are included.

**30. Gain or Loss on Valuation and Disposal of Financial Assets measured at Amortised Costs** 

The details of gain or loss on valuation and disposal of financial assets measured at amortised cost for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Gain(Loss) on valuation of financial assets measured at amortised cost |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal(Provision) of allowance for credit losses of loans | (5790615) | (4314871) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal(Provision) of allowance for credit losses of deposits | (12598) | 106947 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal(Provision) of allowance for credit losses of other financial assets | (1484417) | (1063262) |
|  Gain(Loss) on disposal of financial assets measured at amortised cost |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain(Loss) on disposal of loans measured at amortised cost | (3640849) | 1405114 |
|  | (10928479) | (3866072) |

---

**31. Gain or Loss on Foreign Currency Transactions** 

The details of gain on foreign currency transactions for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Gain on foreign currency transactions |  | 1151952824 |  | 692728817 |
|  Gain on foreign exchange translation |  | 104536359 |  | 85145483 |
|  |  | 1256489183 |  | 777874300 |

---

The details of loss on foreign currency transactions for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Loss on foreign currency transactions |  | 1110025273 |  | 716902499 |
|  Loss on foreign exchange translation |  | 146515703 |  | 28832518 |
|  |  | 1256540976 |  | 745735017 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**32. Other Operating Income and Other Operating Expenses** 

The details of other operating income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Dividend income |  | 49602892 |  | 43442376 |
|  Distribution income |  | 101178211 |  | 101195360 |
|  Reversal of provision for credit loss |  | 2597680 |  | 2758899 |
|  Gains on disposal of general product |  | 41651 |  |  |
|  Others |  | 3360615 |  | 3137321 |
|  |  | 156781049 |  | 150533956 |

---

The details of other operating expenses for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Provision for credit losses |  | 15990682 |  | 3026767 |
|  Others |  | 37757329 |  | 42694906 |
|  |  | 53748011 |  | 45721673 |

---

**33. Selling and Administrative Expenses** 

(a) The details of selling and administrative expenses for the years ended December 31, 2022 and 2021, are as
follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  **Labor costs** |  |  |
|  Salaries | 350121189 | 449001959 |
|  Post-employment benefits | 33061636 | 21492051 |
|  Retirement bonus | 22686894 | 619728 |
|  Other long-term employee benefits | (454613) | 2415192 |
|  Employee benefits | 84596564 | 80461703 |
|  | 490011670 | 553990633 |
|  **Other selling and administrative expenses** |  |  |
|  Employee benefits | 11490947 | 9980170 |
|  Sales promotion expenses | 754374 | 3056724 |
|  Computer system operation expenses | 50881343 | 24436828 |
|  Management expenses for rent | 19284493 | 20531947 |
|  Commissions | 23560103 | 24093066 |
|  Research and development | 310103 | 208948 |
|  Advertising expenses | 26135402 | 28029037 |
|  Depreciation | 47084686 | 41466055 |
|  Training expenses | 2948539 | 1521905 |
|  Amortization expenses of intangible assets | 27565313 | 22148402 |
|  Taxes and dues | 26139663 | 33218538 |
|  Consignment fees | 5792592 | 4536892 |
|  Others | 37891058 | 54294279 |
|  | 279838616 | 267522791 |
|  | 769850286 | 821513424 |

---

(b) Stock Grant Agreement

The executives of the Company have stock grant agreement with KB Financial Group Inc., in which the Company settles the expense arising from the agreement with KB Financial Group Inc. The Company recognizes the expense in profit or loss as selling and administrative expenses.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The details of the share grants linked to long-term performance as at December 31, 2022, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(In number of shares)* | **Grant date** | **Granted**<br> **shares** | **Payable<br>shares<sup>1</sup>** | **Vesting conditions** |
|  Series 1-1 | 2010-1-1 | 1231 | 266 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-8 | 2011-1-1 | 1289 | 365 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-10 | 2012-1-1 | 1976 | 644 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-11 | 2012-6-18 | 708 | 142 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-13 | 2013-1-1 | 3340 | 1074 | Service, vesting conditions : market 40%, non-market 60% |
|  Series 1-19 | 2015-2-24 | 1812 | 584 | Service, vesting conditions : market 30%, non-market 70% |
|  Series 1-21 | 2016-1-1 | 6671 | 1744 | Service, vesting conditions : market 30%, non-market 70% |
|  Series 1-22 | 2016-12-30 | 76379 | 11628 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-23 | 2017-1-9 | 2299 |  | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-24 | 2017-2-24 | 1698 | 1516 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-25 | 2017-6-1 | 1511 | 203 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-26 | 2017-9-4 | 1551 | 1028 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-27 | 2017-8-26 | 2952 |  | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-28 | 2018-1-1 | 14698 | 4103 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-29 | 2018-7-9 | 1208 | 143 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-30 | 2019-1-1 | 80289 | 54959 | Service, vesting conditions : market 80%, non-market 20% |
|  Series 1-30 | 2019-1-1 | 4580 | 3835 | Service, vesting conditions : market 0%, non-market 100% |
|  Series 1-31 | 2019-2-24 | 809 | 637 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-32 | 2019-3-4 | 1888 | 1021 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-33 | 2019-6-1 | 3994 | 2129 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-34 | 2019-9-1 | 2927 | 1059 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-35 | 2019-9-4 | 358 | 207 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-36 | 2019-5-27 | 1167 | 574 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-37 | 2020-1-1 | 48962 | 22614 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-38 | 2020-3-6 | 2856 | 4463 | Service, vesting conditions : market 0%, non-market 100% |
|  Series 1-39 | 2020-8-1 | 12744 | 13849 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-40 | 2021-1-1 | 98808 | 127009 | Service, vesting conditions : market 80%, non-market 20% |
|  Series 1-40 | 2021-1-1 | 5675 | 5675 | Service, vesting conditions : market 0%, non-market 100% |
|  Series 1-41 | 2021-3-4 | 3591 | 4786 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-42 | 2021-3-15 | 5190 | 4671 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-43 | 2021-5-27 | 604 | 298 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-44 | 2021-6-1 | 2904 | 3460 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-45 | 2021-8-1 | 2276 | 1615 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-46 | 2021-9-1 | 3201 | 3376 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-47 | 2022-1-1 | 54170 | 29010 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-48 | 2022-2-17 | 1926 | 838 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-49 | 2022-3-6 | 928 | 928 | Service, vesting conditions : market 0%, non-market 100% |
|  Series 1-50 | 2022-5-9 | 2839 | 920 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-51 | 2022-8-1 | 4683 | 2053 | Service, vesting conditions : market 20%, non-market 80% |
|  Series 1-52 | 2022-8-16 | 4029 | 760 | Service, vesting conditions : market 20%, non-market 80% |
|  |  | 470721 | 314186 |  |

---

<sup>1</sup> The number of maximum payable shares per executive as at December 31, 2022.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The details of share grants linked to short-term performance as at December 31, 2022, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(In number of shares)* | **Grant date** | **Granted**<br> **shares** | **Payable<br>shares<sup>1</sup>** | **Vesting conditions<sup>2</sup>** |
|  Series 2-3 | 2016-1-1 | 6844 | 2392 | Proportional to service period, vesting conditions satisfied |
|  Series 2-4 | 2017-1-1 | 27453 | 14945 | Proportional to service period, vesting conditions satisfied |
|  Series 2-5 | 2018-1-1 | 70959 | 26407 | Proportional to service period, vesting conditions satisfied |
|  Series 2-6 | 2019-1-1 | 60039 | 34480 | Proportional to service period, vesting conditions satisfied |
|  Series 2-7 | 2020-1-1 | 68689 | 53929 | Proportional to service period, vesting conditions satisfied |
|  Series 2-8 | 2021-1-1 | 69448 | 69336 | Proportional to service period, vesting conditions satisfied |
|  Series 2-9 | 2022-1-1 | 98396 | 98396 | Proportional to service period, vesting conditions satisfied |
|  Series 3-3 | 2016-1-1 | 15036 | 9438 | Proportional to service period, vesting conditions satisfied |
|  Series 3-4 | 2017-1-1 | 12112 | 7767 | Proportional to service period, vesting conditions satisfied |
|  Series 3-5 | 2018-1-1 | 25393 | 9624 | Proportional to service period, vesting conditions satisfied |
|  Series 3-6 | 2019-1-1 | 44696 | 26378 | Proportional to service period, vesting conditions satisfied |
|  Series 3-7 | 2020-1-1 | 77112 | 57391 | Proportional to service period, vesting conditions satisfied |
|  Series 3-8 | 2021-1-1 | 91948 | 91948 | Proportional to service period, vesting conditions satisfied |
|  Series 4-1 | 2017-12-31 | 191786 | 21865 | Proportional to service period, vesting conditions satisfied |
|  Series 4-2 | 2019-12-31 | 273097 | 92959 | Proportional to service period, vesting conditions satisfied |
|  Series 4-3 | 2020-12-31 | 283365 | 192737 | Proportional to service period, vesting conditions satisfied |
|  Series 4-4 | 2021-12-31 | 294834 | 294834 | Proportional to service period, vesting conditions satisfied |
|  |  | 1711207 | 1104826 |  |

---

<sup>1</sup> The number of maximum payable shares per executive as at December 31, 2022.

<sup>2</sup> Number of vested shares is determined by performance and paid for a deferred payment schedule over 3 to 5 years.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Share grants are measured at fair value using the Monte Carlo Simulation Model and assumptions used in determining the fair value as at December 31, 2022, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(In Korean won)* | **Risk free<br>rate (%)** | **Fair value (Market<br>performance condition)** | **Fair value (Non-market<br>performance condition)** |
|  Series 1-1 | 3.777 |  | 44,859~46,663 |
|  Series 1-8 | 3.777 |  | 44,859~46,663 |
|  Series 1-10 | 3.777 |  | 44,859~46,663 |
|  Series 1-11 | 3.777 |  | 47,631~47,631 |
|  Series 1-13 | 3.777 |  | 44,859~47,631 |
|  Series 1-19 | 3.777 |  | 45,096~47,631 |
|  Series 1-21 | 3.777 |  | 43,157~50,973 |
|  Series 1-22 | 3.777 |  | 43,157~56,379 |
|  Series 1-23 | 3.777 |  | 45,096~56,379 |
|  Series 1-24 | 3.777 |  | 45,096~56,379 |
|  Series 1-25 | 3.777 |  | 45,096~56,379 |
|  Series 1-26 | 3.777 |  | 45,096~56,379 |
|  Series 1-27 | 3.777 |  | 45,096~56,379 |
|  Series 1-28 | 3.777 |  | 43,157~56,379 |
|  Series 1-29 | 3.777 |  | 45,096~56,379 |
|  Series 1-30 | 3.777 |  | 43,157~56,379 |
|  Series 1-31 | 3.777 |  | 45,096~56,379 |
|  Series 1-32 | 3.777 |  | 41,548~44,859 |
|  Series 1-33 | 3.777 |  | 44,859~56,379 |
|  Series 1-34 | 3.777 |  | 44,859~50,973 |
|  Series 1-35 | 3.777 |  | 45,096~56,379 |
|  Series 1-36 | 3.777 |  | 44,859~50,973 |
|  Series 1-37 | 3.777 |  | 41,548~56,379 |
|  Series 1-38 | 3.777 | 43,157~50,973 | 43,157~46,663 |
|  Series 1-39 | 3.777 | 43,157~50,973 | 43,157~46,663 |
|  Series 1-40 | 3.777 | 40,757~48,322 | 43,157~50,973 |
|  Series 1-41 | 3.777 | 41,033~46,084 | 41,548~44,859 |
|  Series 1-42 | 3.777 | 39,520~44,386 | 41,548~44,859 |
|  Series 1-43 | 3.777 |  | 44,859~50,973 |
|  Series 1-44 | 3.777 | 39,458~44,316 | 41,548~44,859 |
|  Series 1-45 | 3.777 | 41,174~46,243 | 41,548~44,859 |
|  Series 1-46 | 3.777 | 40,609~45,608 | 41,548~44,859 |
|  Series 1-47 | 3.777 | 37,410~62,269 | 41,548~48,461 |
|  Series 1-48 | 3.777 | 35,287~39,615 | 39,958~43,157 |
|  Series 1-49 | 3.777 | 39,057~46,131 | 43,157~46,663 |
|  Series 1-50 | 3.777 | 37,824~42,464 | 39,958~43,157 |
|  Series 1-51 | 3.777 | 38,831~49,087 | 39,958~46,663 |
|  Series 1-52 | 3.777 | 38,040~42,706 | 39,958~43,157 |
|  Series 2-3 | 3.777 |  | 43,157~50,973 |
|  Series 2-4 | 3.777 |  | 43,157~56,379 |
|  Series 2-5 | 3.777 |  | 41,548~56,379 |
|  Series 2-6 | 3.777 |  | 41,548~56,379 |
|  Series 2-7 | 3.777 |  | 41,548~56,379 |
|  Series 2-8 | 3.777 |  | 41,548~57,941 |
|  Series 2-9 | 3.777 |  | 39,958~48,461 |
|  Series 3-3 | 3.777 |  | 43,157~50,973 |
|  Series 3-4 | 3.777 |  | 43,157~50,973 |
|  Series 3-5 | 3.777 |  | 43,157~56,379 |
|  Series 3-6 | 3.777 |  | 41,548~56,379 |
|  Series 3-7 | 3.777 |  | 41,548~56,379 |
|  Series 3-8 | 3.777 |  | 41,548~50,973 |
|  Series 4-1 | 3.777 |  | 45,096~56,379 |
|  Series 4-2 | 3.777 |  | 50,973~50,973 |
|  Series 4-3 | 3.777 |  | 46,663~50,973 |
|  Series 4-4 | 3.777 |  | 44,859~50,973 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The Company used the volatility of the stock price over the previous year as the expected volatility and used the dividend yield as the arithmetic mean of the dividend rate of one year before, two years before, and three years before the base year, in order to calculate fair value. Fair value is calculated based on risk free interest rate of 1 year-KTB rate.

In relation to the above share-based arrangements, the compensation cost amounting to W 63,905,175 thousand and W 63,084,932 thousand are recorded as accrued expenses to KB Financial Group Inc as at December 31, 2022 and 2021, respectively.

**34. Non-operating Income and Non-operating Expenses** 

The details of non-operating income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Gain on disposal of property and equipment | 1481966 | 170470 |
|  Gain on disposal of investment properties | 601745 | 246867 |
|  Gain on disposal of intangible assets |  | 3362 |
|  Reversal of impairment loss on intangible assets | 394684 | 2630059 |
|  Reversal of loss on revaluation of property and equipment | 72800 |  |
|  Rent | 5968469 | 7012044 |
|  Gain related to investments in subsidiaries and associates | 78025598 | 46242488 |
|  Others | 7037551 | 2529223 |
|  | 93582813 | 58834513 |

---

The details of non-operating expenses for the years ended December 31, 2022 and 2021 are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Loss on disposal of property and equipment | 292841 | 184710 |
|  Loss on disposal of investment properties | 29912 |  |
|  Depreciation of investment properties | 418394 | 442702 |
|  Loss on disposal of intangible assets | 22000 | 40656 |
|  Impairment loss on intangible assets | 1028751 | 121016 |
|  Loss on revaluation of property and equipment | 451905 |  |
|  Loss related to investments in subsidiaries and associates | 10726299 | 11701543 |
|  Donation | 8023559 | 7014314 |
|  Others | 58843267 | 33612383 |
|  | 79836928 | 53117324 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**35. Tax Expense and Deferred Tax** 

The details of income tax expense for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Current tax |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current tax on profits for the year | 42582556 | 210118248 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustments in respect of prior years | (1091537) | 2530896 |
|  Deferred tax |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Origination and reversal of temporary differences | 45258160 | 14210462 |
|  Tax recognized directly in equity |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation for financial assets at FVOCI | (2162640) | (4008037) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on revaluation of property and equipment | (12328212) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes on the fair value of financial liabilities designated at FVTPL due to the change of credit risk | (13967207) | (5202092) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of net defined benefit liabilities | (1040964) | 848738 |
|  Tax effect derived from group's income tax system | 2997367 | (3938930) |
|  Income tax expense | 60247522 | 214559285 |

---

Reconciliation of profit before tax and tax expense for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Profit before tax (A) | 230542478 | 812204996 |
|  Tax based on statutory rate | 55329280 | 212994374 |
|  Adjustments |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-deductible expense | 4321064 | 5549618 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-taxable income | (3968641) | (1197227) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in deferred tax assets (liabilities) that have not been recognized | (612030) | (300531) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Effect from tax reduction and credit | (201610) | (81033) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustment in respect of prior years | (1091537) | 2530896 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tax effect from group's income tax system | 2997367 | (3938930) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in tax rate | 1797093 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 1676536 | (997882) |
|  Tax expense (B) | 60247522 | 214559285 |
|  Effective tax rate (B/A) | 26.13% | 26.42% |

---

The changes in deferred tax assets (liabilities) for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Profit (loss)**<br> **for the year** | **Other<br>comprehensive<br>income** | **Ending**<br> **balance** |
|  Provision for impairment | 142086 | (5167) |  | 136919 |
|  Commissions income | 4622730 | 3180864 |  | 7803594 |
|  Financial assets at FVOCI | (79210178) | (4561632) | (2162640) | (85934450) |
|  Defined benefit obligation | 19501521 | (640015) | (1040964) | 17820542 |
|  Other long-term employee benefits | 2098484 | (196781) |  | 1901703 |
|  Financial assets at FVTPL | 55244765 | 139967430 |  | 195212195 |
|  Financial liabilities at FVTPL | (49107484) | (244071368) | (13967207) | (307146059) |
|  Accrued expenses | 75757563 | (21294658) |  | 54462905 |
|  Dividends (specific overseas company) | 10545651 | (1126588) |  | 9419063 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  Accrued income | (22988746) | (1787714) |  | (24776460) |
|  Property and equipment | (9782627) | 75168 | (12328212) | (22035671) |
|  Provisions for asset retirement obligation | 2199329 | 133270 |  | 2332599 |
|  Investments in associates and subsidiaries | 1747824 | (1911192) |  | (163368) |
|  Derivatives | (57458767) | 102627090 |  | 45168323 |
|  Loans | 1584488 | 20228 |  | 1604716 |
|  Intangible assets | (20530350) | 297978 |  | (20232372) |
|  Plan assets | (4206052) | 912075 |  | (3293977) |
|  Advance depreciation provision | (2501796) | 90974 |  | (2410822) |
|  Interest related to loan for construction | (64951) | 6099 |  | (58852) |
|  Others | 40214855 | 11912773 |  | 52127628 |
|  Subtotal | (32191655) | (16371166) | (29499023) | (78061844) |
|  Unrecognized deferred tax assets (liabilities) | (3604707) | (612030) |  | (4216737) |
|  Deferred tax assets (liabilities), net <sup>1</sup> | (28586948) | (15759136) | (29499023) | (73845107) |

---

<sup>1</sup> The income tax rates used in computing deferred tax assets (liabilities) are the expected average tax rate, which is applicable to the forecasted period when the temporary differences are reversed.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Beginning<br>balance** | **Profit (loss)**<br> **for the year** | **Other<br>comprehensive<br>income** | **Ending<br>balance** |
|  Provision for impairment | 142086 |  |  | 142086 |
|  Commissions income | 5354729 | (731999) |  | 4622730 |
|  Financial assets at FVOCI | (77700924) | 2498784 | (4008037) | (79210177) |
|  Defined benefit obligation | 19879337 | (1226555) | 848739 | 19501521 |
|  Other long-term employee benefits | 1637421 | 461063 |  | 2098484 |
|  Financial assets at FVTPL | (36226370) | 91471135 |  | 55244765 |
|  Financial liabilities at FVTPL | 83623427 | (127528819) | (5202093) | (49107485) |
|  Accrued expenses | 68421675 | 7335888 |  | 75757563 |
|  Dividends (specific overseas company) | 10809313 | (263662) |  | 10545651 |
|  Accrued income | (22546280) | (442466) |  | (22988746) |
|  Property and equipment | (9816743) | 34116 |  | (9782627) |
|  Provisions for asset retirement obligation | 2231568 | (32239) |  | 2199329 |
|  Investments in associates and subsidiaries | (643340) | 2391164 |  | 1747824 |
|  Derivatives | (70377421) | 12918654 |  | (57458767) |
|  Loans | 170188 | 1414300 |  | 1584488 |
|  Intangible assets | (20771808) | 241458 |  | (20530350) |
|  Plan assets | (5129321) | 923269 |  | (4206052) |
|  Advance depreciation provision | (2560369) | 58573 |  | (2501796) |
|  Interest related to loan for construction | (68829) | 3878 |  | (64951) |
|  Others | 35890999 | 4323856 |  | 40214855 |
|  Subtotal | (17680662) | (6149602) | (8361391) | (32191655) |
|  Unrecognized deferred tax assets (liabilities) | (3304176) | (300531) |  | (3604707) |
|  Deferred tax assets (liabilities), net <sup>1</sup> | (14376486) | (5849071) | (8361391) | (28586948) |

---

<sup>1</sup> The income tax rates used in computing deferred tax assets (liabilities) are the expected average tax rate, which is applicable to the forecasted period when the temporary differences are reversed.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Temporary differences which were not recognized due to uncertainty of their realization as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Taxable temporary difference |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in subsidiaries | 17815543 | 17815543 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Intangible assets | 58888990 | 58888990 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 445550 | 445550 |
|  | 77150083 | 77150083 |
|  Deductible temporary difference |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Commission (local subsidiary) | 7512805 | 7512805 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends (specific overseas company) | 35543632 | 38347821 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in subsidiaries | 15476124 | 15476124 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 2705305 | 2705305 |
|  | 61237866 | 64042055 |
|  | 15912217 | 13108028 |

---

Details of income taxes that are charged or credited directly to equity for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Recognized in other comprehensive income |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation for financial assets at FVOCI | (39698) | (4768491) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on revaluation of property and equipment | (12328212) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes on the fair value of financial liabilities designated at FVTPL due to the change of credit risk | (13967207) | (5202092) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of net defined benefit liabilities | (1040964) | 848738 |
|  Reclassified to profit or loss |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation for financial assets at FVOCI | (2122942) | 760454 |
|  | (29499023) | (8361391) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**36. Carrying Amounts of Financial Instruments by Category** 

Financial assets and liabilities are measured at fair value or amortised cost. Measurement policies for each category of financial assets and financial liabilities are disclosed in Note 2, 'Significant accounting policies'.

The carrying amounts of financial assets and liabilities by category as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Financial asset<br>measured at fair<br>value through**<br> **profit or loss** | **Financial asset<br>measured at fair value<br>through Other<br>Comprehensive income** | **Financial asset<br>measured at<br>amortised cost** | **Totals** |
|  **Financial Assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits |  |  | 4028288407 | 4028288407 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial Assets at FVTPL | 28995718418 |  |  | 28995718418 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives | 1701970056 |  |  | 1701970056 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity instruments at FVOCI |  | 686116835 |  | 686116835 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt instruments at FVOCI |  | 4112728624 |  | 4112728624 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost |  |  | 6566785893 | 6566785893 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  |  | 2698990295 | 2698990295 |
|  | 30697688474 | 4798845459 | 13294064595 | 48790598528 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Financial<br>liabilities<br>measured at**<br> **fair value<br>through**<br> **profit or loss** | **Financial<br>liabilities<br>designated at**<br> **fair value**<br> **through profit**<br> **or loss** | **Financial<br>liabilities<br>measured at<br>amortised cost** | **Derivative<br>liabilities<br>(hedging)** | **Totals** |
|  **Financial Liabilities** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL | 2082979265 |  |  |  | 2082979265 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL |  | 10088600213 |  |  | 10088600213 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities | 2307993521 |  |  | 10070190 | 2318063711 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit liabilities |  |  | 6819371625 |  | 6819371625 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  | 20575667241 |  | 20575667241 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  |  | 2243572915 |  | 2243572915 |
|  | 4390972786 | 10088600213 | 29638611781 | 10070190 | 44128254970 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Financial asset<br>measured at fair<br>value through**<br> **profit or loss** | **Financial asset<br>measured at fair value<br>through Other<br>Comprehensive income** | **Financial asset<br>measured at amortised<br>cost** | **Totals** |
|  **Financial Assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits |  |  | 3345119600 | 3345119600 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial Assets at FVTPL | 33833764376 |  |  | 33833764376 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives | 811015166 |  |  | 811015166 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity instruments at FVOCI |  | 445652737 |  | 445652737 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt instruments at FVOCI |  | 3392645493 |  | 3392645493 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost |  |  | 5430443816 | 5430443816 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  |  | 3724896077 | 3724896077 |
|  | 34644779542 | 3838298230 | 12500459493 | 50983537265 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Financial<br>liabilities<br>measured at**<br> **fair value<br>through**<br> **profit or loss** | **Financial<br>liabilities<br>designated at<br>fair value<br>through profit<br>or loss** | **Financial<br>liabilities<br>measured at<br>amortised cost** | **Derivative<br>liabilities<br>(hedging)** | **Totals** |
|  **Financial Liabilities** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL | 2825922918 |  |  |  | 2825922918 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL |  | 9160923652 |  |  | 9160923652 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities | 830630902 |  |  | 6068500 | 836699402 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit liabilities |  |  | 8400368430 |  | 8400368430 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  | 21994629818 |  | 21994629818 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  |  | 3310748094 |  | 3310748094 |
|  | 3656553820 | 9160923652 | 33705746342 | 6068500 | 46529292314 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**37. Financial Instruments** 

**37.1 Fair Value of Financial Instruments by Class** 

Fair values of financial assets and financial liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Carrying**<br> **amount** | **Fair value** | **Carrying**<br> **amount** | **Fair value** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and deposits <sup>2</sup> | 4028288407 | 4028288407 | 3345119600 | 3345119600 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL <sup>1</sup> | 28995718418 | 28995718418 | 33833764376 | 33833764376 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets <sup>1</sup> | 1701970056 | 1701970056 | 811015166 | 811015166 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVOCI | 4798845459 | 4798845459 | 3838298230 | 3838298230 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost | 6566785893 | 6544314422 | 5430443816 | 5438252442 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets <sup>2</sup> | 2698990295 | 2698990295 | 3724896077 | 3724896077 |
|  | 48790598528 | 48768127057 | 50983537265 | 50991345891 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Carrying**<br> **amount** | **Fair value** | **Carrying**<br> **amount** | **Fair value** |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit liabilities <sup>2</sup> | 6819371625 | 6819371625 | 8400368430 | 8400368430 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL | 2082979265 | 2082979265 | 2825922918 | 2825922918 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL <sup>1</sup> | 10088600213 | 10088600213 | 9160923652 | 9160923652 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities <sup>1</sup> | 2318063711 | 2318063711 | 836699402 | 836699402 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings | 20575667241 | 20512526086 | 21994629818 | 21981900347 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities <sup>2</sup> | 2243572915 | 2243572915 | 3310748094 | 3310748094 |
|  | 44128254970 | 44065113815 | 46529292314 | 46516562843 |

---

<sup>1</sup> Deferred transaction gain or losses are adjusted in the carrying amount. 

<sup>2</sup> The fair value of cash and deposits, other financial assets, deposit liabilities and other financial liabilities with short maturity dates or uncertain maturity dates are presented at their book amounts. 

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. For each class of financial assets and financial liabilities, the Company discloses the fair value of that class of assets and liabilities in a way that permits it to be compared with its carrying amount at the end of each reporting period. The best evidence of fair value of financial instruments is a quoted price in an active market.

**37.2 Fair Value Hierarchy** 

Financial instruments measured at fair value are categorized within the fair value hierarchy, and the defined levels are as follows:

---

| | |
|:---|:---|
| Level 1 | Quoted prices (unadjusted) in active markets for identical assets or liabilities |
| Level 2 | Fair value using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, prices) or indirectly (that is, derived from prices) |
| Level 3 | Fair value using inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The inputs used to measure the fair value of an asset or a liability might be categorized within different levels of the fair value hierarchy. In those cases, the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. The observable input is generally used to the Fair value measurement. However, if an observable input requires an adjustment using an unobservable input and that adjustment results in a significantly higher or lower fair value measurement, the resulting measurement would be categorized within Level 3 of the fair value hierarchy.

(a) Fair value hierarchy of financial instruments measured at fair value

The fair value hierarchy of financial assets and liabilities measured at fair value as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL – debt instruments <sup>1</sup> | 6259722865 | 19448292474 | 2136574599 | 27844589938 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL - equity instruments | 481362503 | 520104659 | 149661318 | 1151128480 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets <sup>1</sup> | 96188443 | 1485006498 | 120775115 | 1701970056 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVOCI | 5025406 | 4372289778 | 421530275 | 4798845459 |
|  | 6842299217 | 25825693409 | 2828541307 | 35496533933 |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL | 2082979265 |  |  | 2082979265 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL<sup>1</sup> | 35687313 | 1811403735 | 8241509165 | 10088600213 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities <sup>1</sup> | 422619560 | 1117902302 | 777541849 | 2318063711 |
|  | 2541286138 | 2929306037 | 9019051014 | 14489643189 |

---

<sup>1</sup> Deferred transaction gain or losses are adjusted in the carrying amount. 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL – debt instruments <sup>1</sup> | 7098545069 | 24110564296 | 1607975591 | 32817084956 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL - equity instruments | 367264430 | 528403259 | 121011731 | 1016679420 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets <sup>1</sup> | 68529631 | 532676875 | 209808660 | 811015166 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVOCI | 20989065 | 3450533070 | 366776095 | 3838298230 |
|  | 7555328195 | 28622177500 | 2305572077 | 38483077772 |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL | 2825922918 |  |  | 2825922918 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities designated at FVTPL<sup>1</sup> | 36937827 | 1294944846 | 7829040979 | 9160923652 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities <sup>1</sup> | 197253920 | 470981570 | 168463912 | 836699402 |
|  | 3060114665 | 1765926416 | 7997504891 | 12823545972 |

---

<sup>1</sup> Deferred transaction gain or losses are adjusted in the carrying amount. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**37.3 Valuation techniques and inputs classified by Level 2** 

The details of the valuation techniques and inputs classified by Level 2 as at December 31, 2022 and 2021 are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **Valuation techniques** | **Inputs** |
|  Financial assets at FVTPL | 19968397133 | DCF Model, Closed form formula, Monte Carlo Simulation, Black Scholes model, Hull and White Model, Net asset value and others | Price of underlying asset, interest rate, dividend rate, volatility, discount rate and others |
|  Derivative financial assets(trading) | 1485006498 | DCF Model, Closed form formula, Monte Carlo Simulation, Black Scholes model, Hull and White Model, Net asset value and others | Interest rate, price of underlying asset, exchange rate, credit spread, discount rate, volatility and others |
|  Financial assets at FVOCI | 4372289778 | DCF Model | Discount rate, Interest rate and others |
|  | 25825693409 |  |  |
|  Financial liabilities designated at FVTPL | 1811403735 | DCF Model, Closed form formula, Monte Carlo Simulation, Black Scholes model, Hull and White Model, Net asset value and others | Price of underlying asset, interest rate, dividend rate, volatility, discount rate |
|  Derivative financial liabilities(trading) | 1107832112 | DCF Model, Closed form formula, Monte Carlo Simulation, Black Scholes model, Hull and White Model, Net asset value and others | Interest rate, price of underlying asset, exchange rate, credit spread, discount rate, volatility |
|  Derivative financial liabilities(hedging) | 10070190 | DCF Model | Discount rate, exchange rate and others |
|  | 2929306037 |  |  |

---

The details of the valuation techniques and inputs classified by Level 2 as at December 31, 2022 and 2021 are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **Valuation techniques** | **Inputs** |
|  Financial assets at FVTPL | 24638967555 | DCF Model, Closed form formula, Monte Carlo Simulation, Black Scholes model, Hull and White Model, Net asset value and others | Price of underlying asset, interest rate, dividend rate, volatility, discount rate and others |
|  Derivative financial assets(trading) | 532676875 | DCF Model, Closed form formula, Monte Carlo Simulation, Black Scholes model, Hull and White Model, Net asset value and others | Interest rate, price of underlying asset, exchange rate, credit spread, discount rate, volatility and others |
|  Financial assets at FVOCI | 3450533070 | DCF Model | Discount rate, Interest rate and others |
|  | 28622177500 |  |  |
|  Financial liabilities designated at FVTPL | 1294944846 | DCF Model, Closed form formula, Monte Carlo Simulation, Black Scholes model, Hull and White Model, Net asset value and others | Price of underlying asset, interest rate, dividend rate, volatility, discount rate |
|  Derivative financial liabilities(trading) | 464913070 | DCF Model, Closed form formula, Monte Carlo Simulation, Black Scholes model, Hull and White Model, Net asset value and others | Interest rate, price of underlying asset, exchange rate, credit spread, discount rate, volatility |
|  Derivative financial liabilities(hedging) | 6068500 | DCF Model | Discount rate, exchange rate and others |
|  | 1765926416 |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**37.4 Level 3 of the Fair Value Hierarchy Disclosure** 

(a) Valuation Process for Fair Value Measurements Categorized Within Level 3 of the Fair Value Hierarchy

The fair value of financial instruments classified as Level 3 is determined by external valuation or self-valuation of the Company. Unobservable inputs are produced by the external appraiser or internal valuation system and the Company reviews the adequacy of inputs. The risk management council reviews the adequacy of the assessment methodology and valuation method of external appraiser and the internal valuation. The agenda of the risk management council is to be reported or approved by the risk committee.

(b) Changes in Recurring Fair Value Measurements Categories of the Fair Value hierarchy

The changes in financial instruments with Level 3 fair value for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Financial assets**<br> **at FVTPL** | **Financial assets**<br> **at FVOCI** | **Net derivatives** | **Financial liabilities**<br> **designated at FVTPL** |
|  Beginning balance | 1728987322 | 366776095 | 41344748 | (7829040979) |
|  Total gains or losses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit or loss | (73050511) |  | (666119493) | 563317417 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other comprehensive income |  | 54754180 |  | 60520089 |
|  Purchases | 898515700 |  | 23525783 |  |
|  Sales | (278907255) |  | (59177496) |  |
|  Issues |  |  | (14796230) | (5222820340) |
|  Settlements |  |  | 18455954 | 4186514648 |
|  Transfer within levels <sup>1</sup> | 10690661 |  |  |  |
|  Ending balance | 2286235917 | 421530275 | (656766734) | (8241509165) |

---

<sup>1</sup> Transfer within levels are occurred due to the change in the availability of observable market data on the financial instruments.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Financial assets**<br> **at FVTPL** | **Financial assets**<br> **at FVOCI** | **Net derivatives** | **Financial liabilities**<br> **designated at FVTPL** |
|  Beginning balance | 2098896249 | 308570199 | 306558966 | (9214284213) |
|  Total gains or losses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit or loss | (1512188) |  | (66664335) | 63081409 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other comprehensive income |  | 39799222 |  | (5445079) |
|  Purchases | 774782753 | 18406674 | 3952205 |  |
|  Sales | (1195604829) |  | (169985927) |  |
|  Issues |  |  | (32516161) | (8233127666) |
|  Settlements |  |  |  | 9560734570 |
|  Transfer within levels <sup>1</sup> | 52425337 |  |  |  |
|  Ending balance | 1728987322 | 366776095 | 41344748 | (7829040979) |

---

<sup>1</sup> Transfer within levels are occurred due to the change in the availability of observable market data on the financial instruments.

In relation to changes in Level 3 fair value, total gains or losses related to the asset and liabilities held at the reporting date are included in the statements of comprehensive income for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Financial assets**<br> **at FVTPL** | **Financial assets**<br> **at FVOCI** | **Net derivatives** | **Financial liabilities**<br> **designated at FVTPL** |
|  **Profit or loss** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation of financial instruments <sup>1</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(84173390) |  | (558677313) | 726467752 |
|  **Other comprehensive income** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation of financial assets at FVOCI <sup>2</sup> |  | 54754180 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in fair value of financial liabilities at FVTPL due to the change of credit risk <sup>2</sup> |  |  |  | 56580809 |
|  | (84173390) | &nbsp;&nbsp;&nbsp;&nbsp;54754180 | (558677313) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;783048561 |

---

<sup>1</sup> Included in gain or loss on valuation and disposal of financial instruments on the statements of Profit or Loss.

<sup>2</sup> Included in other comprehensive income on the statements of comprehensive income.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Financial assets**<br> **at FVTPL** | **Financial assets**<br> **at FVOCI** | **Net derivatives** | **Financial liabilities**<br> **designated at FVTPL** |
|  **Profit or loss** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation of financial instruments <sup>1</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(26217164) |  | (109925653) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;105096746 |
|  **Other comprehensive income** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain or loss on valuation of financial assets at FVOCI <sup>2</sup> |  | 39799222 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in fair value of financial liabilities at FVTPL due to the change of credit risk <sup>2</sup> |  |  |  | 6607886 |
|  | (26217164) | &nbsp;&nbsp;&nbsp;&nbsp;39799222 | (109925653) | 111704632 |

---

<sup>1</sup> Included in gain or loss on valuation and disposal of financial instruments on the statements of Profit or Loss.

<sup>2</sup> Included in other comprehensive income on the statements of comprehensive income.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

(c) Valuation techniques and the Inputs classified by Level 3

Valuation techniques and inputs for level 3 financial instruments are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of<br>Korean won)* | **Type** | **Fair value** | **Valuation<br>techniques** | **Inputs** | **Unobservable**<br> **input** | **Range** | **Relevance** |
|  Financial assets at FVTPL | Equity-linked securities | 10127847 | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.22 ~ 0.25 | Proportional |
|  |  |  | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.37 ~ 0.73 | Proportional |
|  | Other derivative linked securities | 162897287 | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.25 ~ 0.33 | Proportional |
|  |  |  | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | 0.12 ~ 0.93 | Proportional |
|  | Other OTC derivative linked contract | 231308457 | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.19 ~ 0.36 | Proportional |
|  |  |  | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.76 | Proportional |
|  | Debt instruments | 1732241008 | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.24 ~ 0.36 | Proportional |
|  | Equity instruments | 149661318 | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Discount rate | 0.08 ~ 0.23 | Inversely proportional |
|  Derivative financial assets (trading) | <sup>1</sup> | 120775115 | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.10 ~ 0.59 | Proportional |
|  |  |  | DCF model, Closed Form, Monte Carlo Simulation, Black-Scholes Model, Hull and White, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.93 | Proportional |
|  Financial assets at FVOCI | Equity instruments | 421530275 | DCF model, Risk-adjusted discount rate model, IMV model and others | Growth rate, discount rate | Growth rate | 0.01 ~ 0.01 | Proportional |
|  |  |  | DCF model, Risk-adjusted discount rate model, IMV model and others | Growth rate, discount rate | Discount rate | 0.11 ~ 0.13 | Inversely proportional |
|  |  | 2828541307 |  |  |  |  |  |
|  Financial liabilities designated at FVTPL | Equity-linked securities sold | 6726257399 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.19 ~ 0.59 | Proportional |
|  |  |  | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.80 | Proportional |
|  | Derivatives linked securities sold | 1321382570 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.01 ~ 1.19 | Proportional |
|  |  |  | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.50 ~ 0.93 | Proportional |
|  | Other OTC derivatives linked contract sold | 193869196 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.19 ~ 0.32 | Proportional |
|  |  |  | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.73 | Proportional |
|  Derivative financial liabilities (trading) | <sup>1</sup> | 777541849 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.09 ~ 1.19 | Proportional |
|  |  |  | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.93 | Proportional |
|  |  | 9019051014 |  |  |  |  |  |

---

<sup>1</sup> Derivatives which derive their value from interest rate, stock price, foreign exchange rate, commodity price, credit rate and others are included.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of<br>Korean won)* | **Type** | **Fair value** | **Valuation<br>techniques** | **Inputs** | **Unobservable**<br> **input** | **Range** | **Relevance** |
|  Financial assets at FVTPL | Other derivative linked securities | 29067962 | DCF model, Closed Form, Monte Carlo Simulation, Hull and White Model, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.26 ~ 0.54 | Proportional |
|  |  |  | DCF model, Closed Form, Monte Carlo Simulation, Hull and White Model, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | 0.08 ~ 0.90 | Proportional |
|  | Other OTC derivative linked contract | 99015526 | DCF model, Closed Form, Monte Carlo Simulation, Hull and White Model, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.16 ~ 0.26 | Proportional |
|  |  |  | DCF model, Closed Form, Monte Carlo Simulation, Hull and White Model, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.77 | Proportional |
|  | Debt instruments | 1479892103 | DCF model, Closed Form, Monte Carlo Simulation, Hull and White Model, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.14 ~ 0.30 | Proportional |
|  | Equity instruments | 121011731 | DCF model, Closed Form, Monte Carlo Simulation, Hull and White Model, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Discount rate | 0.10 ~ 0.17 | Inversely proportional |
|  Derivative financial assets (trading) | <sup>1</sup> | 209808660 | DCF model, Closed Form, Monte Carlo Simulation, Hull and White Model, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.03 ~ 0.81 | Proportional |
|  |  |  | DCF model, Closed Form, Monte Carlo Simulation, Hull and White Model, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.90 | Proportional |
|  Financial assets at FVOCI | Equity instruments | 366776095 | DCF model, Risk-adjusted discount rate model, IMV model and others | Growth rate, discount rate | Growth rate | 0.01 ~ 0.01 | Proportional |
|  |  |  | DCF model, Risk-adjusted discount rate model, IMV model and others | Growth rate, discount rate | Discount rate | 0.11 ~ 0.15 | Inversely proportional |
|  |  | 2305572077 |  |  |  |  |  |
|  Financial liabilities designated at FVTPL | Equity-linked securities sold | 6117086280 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.15 ~ 0.81 | Proportional |
|  |  |  | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.88 | Proportional |
|  | Derivatives linked securities sold | 1567907416 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.01 ~ 0.81 | Proportional |
|  | Derivatives linked securities sold | 1567907416 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.48 ~ 0.90 | Proportional |
|  | Other OTC derivatives linked contract sold | 144047283 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.15 ~ 0.30 | Proportional |
|  | Other OTC derivatives linked contract sold | 144047283 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.74 | Proportional |
|  Derivative financial liabilities (trading) | <sup>1</sup> | 168463912 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Underlying asset volatility | 0.05 ~ 0.81 | Proportional |
|  Derivative financial liabilities (trading) | <sup>1</sup> | 168463912 | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default |  |  |  |
|  |  |  | DCF model, Closed Form, FDM, Monte Carlo Simulation, Hull and White, Black-Scholes Model, Net asset value, etc. | Price of underlying asset, interest rate, discount rate, dividend ratio, volatility of underlying assets, correlation of underlying assets, volatility of interest rate, probability of default | Correlation | -0.60 ~ 0.90 | Proportional |
|  |  | 7997504891 |  |  |  |  |  |

---

<sup>1</sup> Derivatives which derive their value from interest rate, stock price, foreign exchange rate, commodity price, credit rate and others are included.

(d) Sensitivity Analysis of Recurring Fair Value Measurements Categorized Within Level 3 of the Fair Value Hierarchy

Sensitivity analysis of financial instruments is performed to measure favorable and unfavorable changes in the fair value of financial instruments which are affected by the unobservable inputs, using a statistical technique. When the fair value is affected by more than two inputs, the amounts represent the most favorable or most unfavorable.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The results of the sensitivity analysis for the effect on profit or loss from changes in inputs for each financial instrument as at December 31, 2022 and 2021, are as follows.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
|  | **Profit and loss** | **Profit and loss** | **Other comprehensive income** | **Other comprehensive income** |
| *(in thousands of Korean won)* | **Favorable<br>changes** | **Unfavorable<br>changes** | **Favorable<br>changes** | **Unfavorable<br>changes** |
|  **Financial assets** |  |  |  |  |
|  Financial assets at FVTPL<sup>1</sup> | 15315917 | (12534554) |  |  |
|  Derivative financial assets <sup>1</sup> | 17639228 | (18599459) |  |  |
|  Financial assets at FVOCI <sup>2</sup> |  |  | 31718711 | (21878733) |
|  | 32955145 | (31134013) | 31718711 | (21878733) |
|  **Financial liabilities** |  |  |  |  |
|  Financial liabilities designated at FVTPL<sup>1</sup> | 94000806 | (97663062) |  |  |
|  Derivative financial liabilities <sup>1</sup> | 48696201 | (46355477) |  |  |
|  | 142697007 | (144018539) |  |  |

---

<sup>1</sup> Measured by changes in fair value based on the increased or decreased unobservable volatility of underlying assets by 10% or unobservable input(growth rate and discount rate) by 1%. 

<sup>2</sup> Measured by changes in fair value based on growth rate ((-)1~1%) and discount rate ((-)1~1%) that are unobservable inputs. 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
|  | **Profit and loss** | **Profit and loss** | **Other comprehensive income** | **Other comprehensive income** |
| *(in thousands of Korean won)* | **Favorable<br>changes** | **Unfavorable<br>changes** | **Favorable<br>changes** | **Unfavorable<br>changes** |
|  **Financial assets** |  |  |  |  |
|  Financial assets at FVTPL<sup>1</sup> | 7078832 | (5695295) |  |  |
|  Derivative financial assets <sup>1</sup> | 19235324 | (19935240) |  |  |
|  Financial assets at FVOCI <sup>2</sup> |  |  | 26761121 | (18444528) |
|  | 26314156 | (25630535) | 26761121 | (18444528) |
|  **Financial liabilities** |  |  |  |  |
|  Financial liabilities designated at FVTPL<sup>1</sup> | 78355694 | (82796956) |  |  |
|  Derivative financial liabilities <sup>1</sup> | 31113821 | (29105058) |  |  |
|  | 109469515 | (111902014) |  |  |

---

<sup>1</sup> Measured by changes in fair value based on the increased or decreased unobservable volatility of underlying assets by 10% or unobservable input(growth rate and discount rate) by 1%. 

<sup>2</sup> Measured by changes in fair value based on growth rate ((-)1~1%) and discount rate ((-)1~1%) that are unobservable inputs. 

(e) Day 1 Profit and Loss

If the Company uses a valuation technique that uses data not obtained from observable markets for the fair value at initial recognition of financial instruments, there could be a difference between the transaction price and the amount determined using that valuation technique. In these circumstances, the fair value of financial instruments is recognized as the transaction price and the difference is amortised by using the straight-line method over the life of the financial instruments. If the fair value of the financial instruments can be subsequently determined using observable market inputs, the remaining deferred amount is immediately recognized in profit or loss.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The aggregate difference yet to be recognized in profit or loss at the beginning and end of the year, and the changes in the balance of this difference, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Balances at the beginning of the year (A) | 93995795 | 70759191 |
|  Incurred during the year (B) | 111326521 | 176475408 |
|  Amounts recognized in profit or loss during the year (C) | (121945132) | (153238804) |
|  Balances at the end of the year (A+B+C) | 83377184 | 93995795 |

---

**37.5 Fair value hierarchy of financial instruments which the fair value is disclosed** 

(a) The fair value hierarchy of financial assets and liabilities which the fair value is disclosed as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost |  |  | 6544314422 | 6544314422 |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  | 20512526086 | 20512526086 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  **Financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortised cost |  |  | 5438252442 | 5438252442 |
|  **Financial liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  | 21981900347 | 21981900347 |

---

Cash and deposits, other financial assets, deposit liabilities and other financial liabilities that are used book amount as a substitute for fair value because their maturities are relatively short or are not set, are not disclosed.

(b) Valuation techniques and inputs

---

| | |
|:---|:---|
|  | **Valuation technique and inputs** |
| Cash and deposits | The fair value of cash is the same as the book amount. The book amount is used as a substitute value of fair value for the majority of deposits consisting of overnight deposits and deposits with variable interest rate. |
|  Loans measured at amortised cost | The fair values are calculated by discount rate considering market interest rates and borrower's credit risk on expected cash flows. |
|  Deposit liabilities and borrowings | The book amount is used as a substitute value of fair value for demand deposit liabilities, bank overdrafts and call money. With regard to the other deposits and borrowings, the fair values are calculated by discount rate considering residual risks at market interest rates on contractual cash flows. |
|  Other financial assets and liabilities | The book amount is used as a substitute value of fair value instead of applying DCF due to the relatively short-term or indefinite maturity. However, DCF method is applied for several long-term receivables or payables. |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**37.6 Derecognition of financial assets** 

The Company continues to recognize bonds sold under repurchase agreements and securities lending agreement, because the Company transferred the financial asset, but the assets does not meet the derecognition criteria. Due to the nature of transaction that bonds sold under repurchase agreements has repurchase condition with fixed price and securities lending agreement contains the retransfer back condition by the end of lending period, the Company has almost all risks and rewards related to the ownership of the financial assets.

As at December 31, 2022 and 2021, relevant information about transferred financial assets which do not qualify for derecognition are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
|  | **Financial assets at FVTPL** | **Financial assets at FVTPL** | **Financial assets at FVOCI** | **Financial assets at FVOCI** |
| *(in thousands of Korean won)* | **Debt<br> instruments<sup>1,2,3</sup>** | **Equity<br> instruments<sup>2</sup>** | **Debt<br>instruments<sup>1,3</sup>** | **Equity<br>instruments** |
|  Carrying amount of transferred assets | 3728769734 | 52098066 | 2234882535 |  |
|  Carrying amount of related liabilities | 3559217505 |  | 2121560622 |  |

---

<sup>1</sup> Transferred debt instruments under repurchase agreements.

<sup>2</sup> Transferred equity instruments and debt instruments under securities lending agreements.

<sup>3</sup> As at December 31, 2022, the accrued interests related to debt securities of W 22,779 million is excluded.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
|  | **Financial assets at FVTPL** | **Financial assets at FVTPL** | **Financial assets at FVOCI** | **Financial assets at FVOCI** |
| *(in thousands of Korean won)* | **Debt<br>instruments<sup>1,2,3</sup>** | **Equity<br>instruments<sup>2</sup>** | **Debt<br>instruments<sup>1,3</sup>** | **Equity<br>instruments** |
|  Carrying amount of transferred assets | 8452138400 | 253040 | 1990336464 |  |
|  Carrying amount of related liabilities | 8253574637 |  | 1893044535 |  |

---

<sup>1</sup> Transferred debt instruments under repurchase agreements.

<sup>2</sup> Transferred equity instruments and debt instruments under securities lending agreements.

<sup>3</sup> As at December 31, 2021, the accrued interests related to debt securities of W 51,550 million is excluded.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**38. Financial Risk Management** 

**38.1 Summary** 

**38.1.1 Overview of Financial Risk Management Policy** 

The financial risks that the Company is exposed to are credit risk, liquidity risk, market risk, operational risk and others.

The note regarding financial risk management provides information about the risks that the Company is exposed to, including the objectives, policies and processes for assessing and managing the risks and net operating capital ratio management. Additional quantitative information is disclosed throughout these notes to financial statements.

The Company's risk management system focuses on increasing transparency, developing the risk management environment, preventing transmission of risk to other related subsidiaries, and the preemptive response to risk due to rapid changes in the financial environment to support the Company's long-term strategy and business decisions efficiently. Credit risk, liquidity risk, market risk, operational risk, and credit concentration risk are recognized as the Company's key risks. These risks are measured and managed by quantifying regulatory capital and VaR (Value at Risk) using a statistical method.

**38.1.2 Risk Management Organization** 

(a) Board of Directors

Board of Directors are the ultimate decision-making authority that appoint and dismiss risk management committee, establish and amend the risk management committee policies, establish the Company's criteria for risk limit, decide on basic policy of risk management, and approve large-scale investments.

(b) Risk management committee

The risk management committee consists of more than three directors appointed by the Board of Directors (including more than a half of external director). The risk management committee executes the operations delegated by board of directors in accordance with risk management committee policy

(c) Risk management council

Risk management council consists of members by appointing Company's executives, including the director, who is responsible for risk management, compliance, planning/management. Also the organization is delegated by risk management committee to perform deliberation/resolution for major policies and matters related to the risk.

(d) Risk management department

Risk management department carries out practical tasks, required for risk management of the Company, such as supporting the risk management committee, reporting the Company's risk level and computing net operating capital ratio.

**38.1.3 Risk Management System** 

In order to establishing risk management structure, the Company built the total risk management system, ERMS (Enterprise Risk Management System), which is designed for reasonable price valuation against risks and the management of risk limitation to raise the soundness of assets and allocate resources efficiently. Moreover, the Company performs business with risk management basis in mainly by constructing RAPM (Risk Adjusted Performance Measure) and enlarging the portion of performance evaluation.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.1.4 Risk Management Strategy and Policy** 

As an allocation of risk capital and risk limit establishment process, the risk capital is allocated through resolution of risk management committee meetings, and the amount of risk capital is anticipated for each risk sector, business sector and department by reflecting annual management strategy and business plans.

**38.2 Credit Risk** 

**38.2.1 Overview of Credit Risk** 

The Company is exposed to certain level of credit risk and the credit risk is the risk of possible loss to portfolio due to counterparty's credit event and breach of covenant. Credit risk exposure occurs in investment activities such as loans, debt instruments, derivative transactions, and non-trading accounts, or can exist in relating to off-balance accounts.

**38.2.2 Credit Risk Management** 

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations. If the trading department of the Company wants to deal with the counterparty that may cause the credit risk, the trading department submit product management plan and application in advance to get approval by the risk management council and the risk management committee. The deal is executed when the approval by the risk management council and the risk management committee is completed. Credit risk limit depends on 1) standard credit risk limit, 2) concentration limit on the same person and 3) credit rating and additional limit may be added by the trading department. In addition, credit VaR is measured in addition to the credit management listed above and credit VaR due to the internal model is operated by the credit manager measurement system of the risk metrics group. Limit management is performed on a daily basis and stress test is performed on a regular basis and in case of excess of the limit, trading department expedite the process with the procedure set by the risk management department.

**38.2.3 Maximum Exposure to Credit Risk** 

The maximum exposure of credit risk related to the off-balance as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Agreement to purchase the commercial papers <sup>1</sup> | 894200000 | 576882291 |
|  Guarantees and loan commitment | 3852917005 | 3103785725 |
|  | 4747117005 | 3680668016 |

---

<sup>1</sup> As at December 31, 2022 and 2021, asset-backed short-term bonds amounting to W 556,400 million and W 101,660 million, respectively, held by the Company, are included 

The Company does not disclose financial assets (except above contracts) whose carrying amount represents the maximum exposure to credit risk.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.2.4 Credit Risk Concentration Analysis** 

(a) Loans measured at amortised cost

Most of counterparties of loan transactions, before considering collaterals and other credit reinforcements, are concentrated in Korea. The ratios of loans to individuals and corporations and related allowances as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Loans measured<br>at amortised cost** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  Individuals | 2682319898 | 40.68 |  | 2682319898 |
|  Corporations | 3911911080 | 59.32 | (27445085) | 3884465995 |
|  | 6594230978 | 100.00 | (27445085) | 6566785893 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Loans measured<br>at amortised cost** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  Individuals | 2890313072 | 52.66 |  | 2890313072 |
|  Corporations | 2598335650 | 47.34 | (58204906) | 2540130744 |
|  | 5488648722 | 100.00 | (58204906) | 5430443816 |

---

The details of the Company's loans measured at amortised cost by industry as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Loans measured<br>at amortised cost** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  Financial service | 2529470021 | 38.36 | (17794904) | 2511675117 |
|  Manufacturing | 439531330 | 6.67 | (1607909) | 437923422 |
|  Service | 104411078 | 1.58 | (3723201) | 100687876 |
|  Others | 838498651 | 12.71 | (4319070) | 834179580 |
|  Individuals | 2682319898 | 40.68 |  | 2682319898 |
|  | 6594230978 | 100.00 | (27445085) | 6566785893 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Loans measured<br>at amortised cost** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  Financial service | 1461183943 | 26.62 | (14964413) | 1446219530 |
|  Manufacturing | 432375654 | 7.88 | (7704189) | 424671465 |
|  Service | 119472377 | 2.18 | (10785553) | 108686824 |
|  Others | 585303675 | 10.66 | (24750751) | 560552924 |
|  Individuals | 2890313073 | 52.66 |  | 2890313073 |
|  | 5488648722 | 100.00 | (58204906) | 5430443816 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

(b) Deposits, Securities (except equity instruments) and Derivatives

Most of deposits, securities (except equity instruments) and derivatives, before considering collaterals and other credit reinforcements, are concentrated in securities issued in Korea. The details of the Company's securities (except equity instruments) by industry as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Amount** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  **Deposits measured at amortized cost** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 4028919508 | 100.00 | (645197) | 4028274311 |
|  | 4028919508 | 100.00 | (645197) | 4028274311 |
|  **Securities at FVTPL** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 10300399856 | 37.05 |  | 10300399856 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 9499195461 | 34.17 |  | 9499195461 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 8002389633 | 28.78 |  | 8002389633 |
|  | 27801984950 | 100.00 |  | 27801984950 |
|  **Derivatives financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 1596038 | 0.09 |  | 1596038 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 1668105555 | 98.01 |  | 1668105555 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 32268463 | 1.90 |  | 32268463 |
|  | 1701970056 | 100.00 |  | 1701970056 |
|  **Securities at FVOCI** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 449958939 | 10.94 |  | 449958939 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 2493923434 | 60.64 |  | 2493923434 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 1168846251 | 28.42 |  | 1168846251 |
|  | 4112728624 | 100.00 |  | 4112728624 |
|  | 37645603138 |  | (645197) | 37644957941 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Amount** | **Ratio (%)** | **Allowances** | **Carrying**<br> **amount** |
|  **Deposits measured at amortized cost** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 3345752093 | 100.00 | (632598) | 3345119495 |
|  | 3345752093 | 100.00 | (632598) | 3345119495 |
|  **Securities at FVTPL** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 12403754293 | 38.00 |  | 12403754293 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 12012432506 | 36.80 |  | 12012432506 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 8227438794 | 25.20 |  | 8227438794 |
|  | 32643625593 | 100.00 |  | 32643625593 |
|  **Derivatives financial assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 798108024 | 98.41 |  | 798108024 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 12907141 | 1.59 |  | 12907141 |
|  | 811015165 | 100.00 |  | 811015165 |
|  **Securities at FVOCI** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and government funded institutions | 411524232 | 12.13 |  | 411524232 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banking and insurance | 2019245794 | 59.52 |  | 2019245794 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 961875467 | 28.35 |  | 961875467 |
|  | 3392645493 | 100.00 |  | 3392645493 |
|  | 40193038344 |  | (632598) | 40192405746 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.2.5 Credit Quality of Financial Assets** 

(a) Loans measured at amortised cost

Loans measured at amortised cost as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial <br>instruments<br>applying<br>credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial <br>instruments<br>applying<br>credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** |  |  |  |
|  Corporates |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 2069269105 |  |  |  |  | 2069269105 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 1800319296 |  |  |  |  | 1800319296 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 23965895 |  |  |  |  | 23965895 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  | 18356784 |  |  | 18356784 |
|  | 3893554296 |  | 18356784 |  |  | 3911911080 |
|  Retails |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 2591983265 |  |  |  |  | 2591983265 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 90275978 |  |  |  |  | 90275978 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 60654 |  |  |  |  | 60654 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |  |
|  | 2682319897 |  |  |  |  | 2682319897 |
|  **Loans measured at FVTPL** |  |  |  |  |  |  |
|  Corporates |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 |  |  |  |  | 42604988 | 42604988 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |  |
|  |  |  |  |  | 42604988 | 42604988 |
|  | 6575874193 |  | 18356784 |  | &nbsp;&nbsp;&nbsp;&nbsp;42604988 | 6636835965 |

---

<sup>1</sup> The amounts disclosed in above table are before deduction of allowances 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** | **Loans measured at amortised cost <sup>1</sup>** |  |  |  |
|  Corporates |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 1268085960 |  |  |  |  | 1268085960 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 1271234819 |  |  |  |  | 1271234819 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 9775000 |  |  |  |  | 9775000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  | 49239870 |  |  | 49239870 |
|  | 2549095779 |  | 49239870 |  |  | 2598335649 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  Retails |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 2889053207 |  |  | 2889053207 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 1256577 |  |  | 1256577 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 3289 |  |  | 3289 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |
|  | 2890313073 |  |  | 2890313073 |
|  **Loans measured at FVTPL** |  |  |  |  |
|  Corporates |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 |  |  | 173459362 | 173459362 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |
|  |  |  | 173459362 | 173459362 |
|  | 5439408852 | 49239870 | 173459362 | 5662108084 |

---

<sup>1</sup> The amounts disclosed in above table are before deduction of allowances 

---

| | | |
|:---|:---|:---|
| **Ranges** | **Corporates** | **Retails** |
|  Grade 1 | AAA ~ BBB+ | 1 ~ 5 grade |
|  Grade 2 | BBB ~ BB | 6 ~ 8 grade |
|  Grade 3 | BB- ~ B | 9 ~ 10 grade |
|  Grade 4 | B- ~ CCC | 11 grade |
|  Grade 5 | Below CC | Below 12 grade |

---

The effect of measured credit risk which released the credit risk due to enhancement of collateral and other credit supplements secured for loans as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  Guarantee | 7643969 |  |  |  |  | 7643969 |
|  Real estate | 44692385 |  | 208363 |  |  | 44900748 |
|  Securities | 5722045070 |  |  |  |  | 5722045070 |
|  | 5774381424 |  | 208363 |  |  | 5774589787 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won***)** | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  Guarantee | 6774307 |  |  |  |  | 6774307 |
|  Real estate | 69433769 |  | 208363 |  |  | 69642132 |
|  Securities | 4810419571 |  |  |  |  | 4810419571 |
|  | 4886627647 |  | 208363 |  |  | 4886836010 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

(b) Securities (debt instruments)

Securities (debt instruments) that are exposed to credit risks as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  Financial assets at FVOCI <sup>1</sup> | Financial assets at FVOCI <sup>1</sup> | Financial assets at FVOCI <sup>1</sup> | Financial assets at FVOCI <sup>1</sup> |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 3262409959 |  |  |  |  | 3262409959 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 836531848 |  |  |  |  | 836531848 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 13786817 |  |  |  |  | 13786817 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |  |
|  | 4112728624 |  |  |  |  | 4112728624 |

---

<sup>1</sup> Before deduction of allowances

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **The financial<br>instruments<br>not applying<br>expected<br>credit loss<br>model** | **Total** |
|  Financial assets at FVOCI <sup>1</sup> | Financial assets at FVOCI <sup>1</sup> | Financial assets at FVOCI <sup>1</sup> | Financial assets at FVOCI <sup>1</sup> |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 2423690839 |  |  |  |  | 2423690839 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 955435698 |  |  |  |  | 955435698 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 13518956 |  |  |  |  | 13518956 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |  |
|  | 3392645493 |  |  |  |  | 3392645493 |

---

<sup>1</sup> Before deduction of allowances

The Company's standard for credit quality of securities (except equity investments) linked to credit rating presented by 3<sup>rd</sup> party credit rating institutions is as follows.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Domestic | Domestic | Domestic | Foreign | Foreign | Foreign |
| Credit Quality | KIS | NICE | FnPricing | S&P | Fitch-IBCA | Moody's |
|  Grade 1 | AA0 to AAA | AA0 to AAA | AA0 to AAA | A- to AAA | A- to AAA | A3 to Aaa |
|  Grade 2 | A- To AA- | A- To AA- | A- To AA- | BBB- to BBB+ | BBB- to BBB+ | Baa3 to Baa1 |
|  Grade 3 | BBB0 to BBB+ | BBB0 to BBB+ | BBB0 to BBB+ | BB to BB+ | BB to BB+ | Ba2 to Ba1 |
|  Grade 4 | BB0 to BBB- | BB0 to BBB- | BB0 to BBB- | B+ to BB- | B+ to BB- | B1 to Ba3 |
|  Grade 5 | Below BB- | Below BB- | Below BB- | Below B | Below B | Below B2 |

---

The classification of credit quality for debt instruments in Korean won is based on lowest credit rating among the one of three domestic credit rating institutions and the classification of credit quality for debt instruments in foreign currency is based on lowest credit rating among the one of three foreign credit rating institutions

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

(c) Deposits

The credit quality of deposits as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  Deposits measured at amortised cost <sup>1</sup> | Deposits measured at amortised cost <sup>1</sup> | Deposits measured at amortised cost <sup>1</sup> | Deposits measured at amortised cost <sup>1</sup> |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 4028933604 |  |  |  | 4028933604 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | 4028933604 |  |  |  | 4028933604 |

---

<sup>1</sup> Before deduction of allowances

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>credit loss<br>model** | **Total** |
|  Deposits measured at amortised cost <sup>1</sup> | Deposits measured at amortised cost <sup>1</sup> | Deposits measured at amortised cost <sup>1</sup> | Deposits measured at amortised cost <sup>1</sup> |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 3345752093 |  |  |  | 3345752093 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | 3345752093 |  |  |  | 3345752093 |

---

<sup>1</sup> Before deduction of allowances

The Company's standard for credit quality of deposits is same as the one of debt securities.

(d) Commitments

The credit quality of commitments as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **Total** |
|  Guaranteed payment and commitment | Guaranteed payment and commitment | Guaranteed payment and commitment | Guaranteed payment and commitment |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 561861335 |  |  |  | 561861335 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 2836161363 | 31731909 |  |  | 2867893272 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 77738671 | 30000000 |  |  | 107738671 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 421307828 |  |  |  | 421307828 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | 3897069196 | 61731909 |  |  | 3958801105 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **Total** |
|  Guaranteed payment and commitment | Guaranteed payment and commitment | Guaranteed payment and commitment | Guaranteed payment and commitment |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 926934250 | 17282291 |  |  | 944216541 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 1967989885 | 37000000 |  |  | 2004989885 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 | 92906778 | 20000000 |  |  | 112906778 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 | 399845412 | 2000000 |  |  | 401845412 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | 3387676325 | 76282291 |  |  | 3463958616 |

---

(e) Guarantees

The credit quality guarantees as at December 31, 2022 and 2021, are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **Total** |
|  Guarantees | Guarantees | Guarantees | Guarantees |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 139403000 |  |  |  | 139403000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 92512900 |  |  |  | 92512900 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | &nbsp;&nbsp;&nbsp;&nbsp;231915900 |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp;231915900 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial instruments<br>applying lifetime expected<br>credit losses** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **Total** |
|  | **The<br>financial<br>instruments<br>applying<br>12-month<br>expected<br>credit losses** | **Non-impaired** | **Impaired** | **The financial<br>instruments<br>applying<br>Credit loss<br>model** | **Total** |
|  Guarantees | Guarantees | Guarantees | Guarantees |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1 | 139403000 |  |  |  | 139403000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 2 | 92512900 |  |  |  | 92512900 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 3 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 4 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 5 |  |  |  |  |  |
|  | &nbsp;&nbsp;&nbsp;&nbsp;231915900 |  |  |  | &nbsp;&nbsp;&nbsp;&nbsp;231915900 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

(f) Other receivables from securities transactions

Other receivables from securities transactions, which are classified as other financial assets, as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Other receivables related to proprietary trading |  | 182035890 |  | 104074769 |
|  Other receivables related to brokerage Transactions |  | 1970505764 |  | 2635518749 |

---

The Company recognizes receivables and payables between Korea Exchange (Clearing and Settlement Organization) and customers regarding securities brokerage transactions on the trade date. The Company is exposed to credit risks between the trade date and settlement date relating to investment brokerage business, which is standardized by related regulations (generally less than two business days from the trade date). As a central counterparty, Korea Exchange mitigates the payment default risk by managing collective fund for default loss, and the Company mitigates customer default risk through margin requirements system. Also, if the customers can not pay by the settlement date, the Company can collect the receivables through covering. Therefore, credit risk that the Company actually bears is linked to the price fluctuation risk of securities between the trade date and the settlement date.

The Company recognizes assets and liabilities on trade date for regular-way transactions, is exposed to the market risk and credit risk between trade date and settlement date.

**38.3 Liquidity Risk** 

**38.3.1 Overview of Liquidity Risk** 

Liquidity risk is the risk of insolvency or loss due to a disparity between the inflow and outflow of funds, unexpected outflow of funds, and obtaining funds at a high price or disposing of securities at an unfavorable price due to lack of available funds. The Company manages its liquidity risk through analysis of the contractual maturity of all financial assets, liabilities and off-statement of financial position items such as commitments and financial guarantee contracts. The Company discloses them by maturity groups: Up to one month, between over one month and three months, between over three months and twelve months, between over one year and five years, and over five years.

**38.3.2 Liquidity Risk Management Policy** 

The Company has established an appropriate liquidity risk management framework for the management of the Company's short-, medium- and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and by matching the maturity profiles of financial assets and liabilities. Meanwhile, additional details of unused funding arrangement to reduce liquidity risk that the Company holds at its discretion are discussed in Note 41.

**38.3.3 Analysis on Remaining Contractual Maturities of Financial Liabilities** 

Cash flows disclosed for the maturity analysis are undiscounted contractual principal and interest to be received (paid) and, thus, differ from the amount in the financial statements which are based on the present value of expected cash flows in some cases.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The remaining contractual maturities of financial liabilities as at December 31, 2022 and 2021, are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **On demand** | **Up to**<br> **one month** | **One to three**<br> **months** | **Three to 12**<br> **months** | **12 months to**<br> **five years** | **More**<br> **than five**<br> **years** | **Total** |
|  **Financial liabilities** |  |  |  |  |  |  |  |
|  Financial liabilities at FVTPL | 2082979265 |  |  |  |  |  | 2082979265 |
|  Financial liabilities designated at FVTPL <sup>1</sup> | 10088600213 |  |  |  |  |  | 10088600213 |
|  Derivatives (trading) <sup>2</sup> | 2307993521 |  |  |  |  |  | 2307993521 |
|  Derivatives (hedge) |  | 10070190 |  |  |  |  | 10070190 |
|  Deposit liabilities <sup>3</sup> | 6819371625 |  |  |  |  |  | 6819371625 |
|  Borrowings | 7771843528 | 5329426599 | 2015024991 | 4101825134 | 1553452225 |  | 20771572477 |
|  Other financial liabilities | 16349365 | 2032090684 | 8545723 | 28456303 | 91630986 | 8755567 | 2185828628 |
|  Guaranteed payments and commitment <sup>4</sup> | 4190717005 |  |  |  |  |  | 4190717005 |

---

<sup>1</sup> Derivatives-linked securities as financial liabilities designated at FVTPL are classified as 'on demand' because derivatives-linked securities are subject to early settlement.

<sup>2</sup> Derivatives are classified as 'on demand' because contract maturity is not necessary in understanding the cash flow timing of the derivatives

<sup>3</sup> Deposits that are contractually repayable on demand or on short notice are classified as 'on demand' category.

<sup>4</sup> With respect to the guaranteed payments and commitments, the amounts included above, which the Company might pay the maximum amounts based on the contract, if the warrantee claims the entire amount of the guarantee, they are classified on the basis of the earliest period when those agreements may be executed. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **On demand** | **Up to one**<br> **month** | **One to**<br> **three**<br> **months** | **Three to 12**<br> **months** | **12 months to**<br> **five years** | **More than**<br> **five years** | **Total** |
|  **Financial liabilities** |  |  |  |  |  |  |  |
|  Financial liabilities at FVTPL | 2825922918 |  |  |  |  |  | 2825922918 |
|  Financial liabilities designated at FVTPL <sup>1</sup> | 9160923652 |  |  |  |  |  | 9160923652 |
|  Derivatives (trading) <sup>2</sup> | 830630902 |  |  |  |  |  | 830630902 |
|  Derivatives (hedge) |  | 1282400 |  | 4786100 |  |  | 6068500 |
|  Deposit liabilities <sup>3</sup> | 8400368430 |  |  |  |  |  | 8400368430 |
|  Borrowings | 8448833366 | 8200567373 | 714468357 | 2889324557 | 1898833225 |  | 22152026878 |
|  Other financial liabilities | 3376026 | 3155100167 | 4794188 | 21830469 | 84928706 | 24348958 | 3294378514 |
|  Guaranteed payments and commitment <sup>4</sup> | 3680668016 |  |  |  |  |  | 3680668016 |

---

<sup>1</sup> Derivatives-linked securities as financial liabilities designated at FVTPL are classified as 'on demand' because derivatives-linked securities are subject to early settlement.

<sup>2</sup> Derivatives are classified as 'on demand' because contract maturity is not necessary in understanding the cash flow timing of the derivatives

<sup>3</sup> Deposits that are contractually repayable on demand or on short notice are classified as 'on demand' category.

<sup>4</sup> With respect to the guaranteed payments and commitments, the amounts included above, which the Company might pay the maximum amounts based on the contract, if the warrantee claims the entire amount of the guarantee, they are classified on the basis of the earliest period when those agreements may be executed. 

**38.4 Market Risk** 

**38.4.1 Overview of Market Risk** 

Market risk refers to the risk that the value of a position held by the Company may fluctuate due to price fluctuations of market factors such as stock, interest rates, foreign exchange rates, commodity and others.

Market risk is daily managed by establishing the limitations considering products' natures such as position limitations, loss limitations, VaR limitations, sensitivity limitations (duration, delta, gamma, vega, others) and others. Relevant business procedures are processed by written regulations and guidelines.

**38.4.2 Value at Risk ("VaR")** 

The Exposure to market risk is measured by the Value at Risk (VaR). VaR is the potential loss that can occur in the holding position when the market price moves in an adverse direction within a given confidence level for a given holding period in the normal market.

Historical simulation model is used to calculate 10days VaR. Historical simulation model is based on past changes of market variables without assuming a specific probability distribution.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The Company uses the 10-day return of the past two-year time series of the asset risk factor and uses the 99% confidence level of the two-year time series of the portfolio. 10days VaR that is under 99% of confidence level that the Company uses reflects reported daily losses as VaR does not exceed with 99% chance.

The average, minimum and maximum amount of the Company's VaR (99%, 10 days) as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Average** | **Maximum** | **Minimum** | **December 31,**<br> **2022** |
|  Total VaR | 35197541 | 60205109 | 18655089 | 20195624 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Average** | **Maximum** | **Minimum** | **December 31,**<br> **2021** |
|  Total VaR | 27533895 | 44103782 | 13303234 | 32812682 |

---

**38.4.3 Risk Management by Market Risk Factors** 

The Company's market risk is comprised of interest rate risk, foreign exchange rate risk and stock price risk.

(a) Stock price risk

Stock price risk arises in the Company's foreign currency stocks and Korean won stocks.

Hedging instruments of Equity Linked Security and Equity Linked Warrant comprise most of stock trading portfolio and certain security proprietary trading is composed of trading securities on the exchange, futures contracts maturing in a month or two, and others under the restriction of position limitation, sale at loss, loss limitation, and others. Marketable stocks among non-trading positions and stock beneficiary certificates are included in stock price risk and market VaR is computed.

Risk management council allocates position and loss limitations, and risk management department monitors asset management department's possible breach of limitations and other special matters on a daily basis.

(b) Interest rate risk

Trading position interest rate risk usually arises from debt instruments denominated in Korean won. The Company's trading strategy is to benefit from short-term movements in the prices of debt instruments arising from changes in interest rates.

The product prices of the Company's trading accounts are disclosed daily. The risks related to trading accounts are managed by using market value based method such as market VaR and sensitivity analysis.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

(c) Foreign exchange rate risk

Foreign exchange rate risk arises through ownership of assets and liabilities, denominated in currencies other than Korean won, from non-trading positions, or through foreign currency forward agreements, currency swaps and foreign currency trading securities.

The Company computes foreign currency position's net position regularly to follow the Regulation on Financial Investment Business and reports to the supervisory body.

Also, the Company manages the risk for total position exposed to foreign exchange rate including non-trading position by using market price base method such as market VaR and sensitivity analysis.

**38.4.4 Risk Management by Interest Rate Risk Factors** 

The Company closely monitors markets and the outputs of the various industry working groups that manage the transition to the new interest rate indicator, including statements made by the IBOR regulator and various consultative councils related to the transition to alternative interest rates.

In response to these announcements, the Company established an IBOR-related response plan consisting of workflows such as risk management, accounting, tax, law, computerization, and customer management, and completed most of the conversions and replacements accordingly. The Chief Financial Officer (CFO) is responsible for the planning and progress management, and important matters are reported to the Board of Directors.

The purpose of the plan is to identify the impacts and risks associated with interest rate indicator reform within the business, and to prepare and implement an action plan to facilitate the transition to an alternative indicator interest rate. The Company aims to complete the response plan by the end of June, 2023.

The carrying amount of financial instruments that have not been converted to an alternative indicator interest rate as of December 31, 2022 and 2021 are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  | **Exposure amount <sup>1</sup><br>USD LIBOR** | **Exposure amount <sup>1</sup><br>USD LIBOR** |
|  **Measured at amortised cost** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans | 7482357 | 7035224 |
|  **Measured at fair value** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets at FVTPL(non-derivative) | 5014503 | 4694580 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities at FVTPL(derivative) | 103656731 | 103221786 |

---

<sup>1</sup> Financial instruments that will expire before conversion to an alternative indicator interest rate are excluded.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**38.5 Operational Risk** 

**38.5.1 Concept** 

The Company defines operational risk to the extent of financial risk and non-financial risks incurred by unreasonable or wrong internal process, labor, system and external incidents.

**38.5.2 Operational Risk Management** 

The purpose of operational risk management is control activity through continuous improvement of internal controls, performing proactive preventive control, proliferation of culture of risk management by establishing internal control that could respond quickly against change of business environment. OMRS (Operational Risk Management System), supports performing overall risk management such as recognition of operational risk, evaluation and monitoring. Periodically, through RCSA (Risk Control Self Assessment), management of KRI (Key Risk Indicator), management of data loss and related preparation of countermeasures, it controls the risks in advance, as well as collecting data for future advanced management method.

**38.6 Capital Management** 

Main purpose of the capital risk management of the Company is optimizing use of capital and sustaining healthy financial status in order to maximize shareholder value. The Company has performed capital risk management through estimating net capital ratio based on 'Capital Market and Financial Investment Business Act', enforced in February 2009.

Net capital ratio is the net capital minus the total risk amount divided by the essential equity to sustain per each business unit. [(Net capital – total risk amounts) / essential equity to sustain per each business unit]. This formula is calculated based on the financial statements amount.

The net capital is calculated by subtracting deductible items and including additional item from financial investor's net asset (asset-liability) as at date. The deductible item refers any asset that is difficult to be converted into cash immediately such as property, plant and equipment. The adding item includes that any item that recorded as liability without redemption obligation, internal reserves against future losses, items that redeemable in kind and items that function of complemental capital.

Total amount of risk is quantification of all of possible losses from operation of business for financial investor. Quantified amounts of market risks by possible losses due to fluctuation of stock price; interest and exchange rates of the securities that the investment firms held; credit risk amounts from breach of contract by the counterparties and possible losses due to accidents, errors, illegal conduct, any other potential losses from deteriorated condition for operation.

According to the Financial Investment Act, the regulation requires that net capital ratio must be maintained above 100% for the appropriation of the capital and it is required to improve the management if the financial investment firm does not meet the regulation for the net capital ratio.

**39. Offsetting Financial Assets and Financial Liabilities** 

The Company enters into International Derivatives Swaps and Dealers Association ("ISDA") master netting agreements or similar agreement with the Company's derivative counterparties. The Company also enters into repurchase agreements and securities borrowing and lending agreements similar to the master netting agreement for derivatives. Master netting agreements provide protection in bankruptcy in certain circumstances and, where legally enforceable, enable receivables and payables with the same counterparty to be offset for accounting and risk management purposes.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Gross amount** | **Offset**<br> **amount** | **Net amounts**<br> **presented in the**<br> **statement of**<br> **financial**<br> **position** | **Amounts not offset** | **Amounts not offset** | **Net amount** |
| *(in thousands of Korean won)* | **Gross amount** | **Offset**<br> **amount** | **Net amounts**<br> **presented in the**<br> **statement of**<br> **financial**<br> **position** | **Recognized**<br> **financial**<br> **instruments** | **Cash collateral** | **Net amount** |
|  **Financial assets** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives assets, others <sup>1</sup> | 1800627070 |  | 1800627070 | 1240440412 | 194397457 | 365789201 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities purchased under reverse repurchase agreements | 730100000 |  | 730100000 | 730100000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables <sup>4</sup> | 1985950659 | 1897820808 | 88129851 |  |  | 88129851 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables (Payment and settlement) | 26385142 | 26385142 |  |  |  |  |
|  | 4543062871 | 1924205950 | 2618856921 | 1970540412 | 194397457 | 453919052 |
|  **Financial liabilities** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives liabilities, others <sup>1</sup> | 3357495348 |  | 3357495348 | 2658744222 | 83836686 | 614914440 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities sold under reverse resale agreements <sup>2</sup> | 6231390409 |  | 6231390409 | 6231390409 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities sold <sup>3</sup> | 2082979265 |  | 2082979265 | 2082979265 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other payables <sup>4</sup> | 1954742873 | 1897820808 | 56922065 |  |  | 56922065 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other payables (Payment and settlement) | 27716059 | 26385142 | 1330917 |  |  | 1330917 |
|  | 13654323954 | 1924205950 | 11730118004 | 10973113896 | 83836686 | 673167422 |

---

<sup>1</sup> Both of derivatives (trading) and derivatives (hedge) are included.

<sup>2</sup> Securities sold under reverse resale agreements to the customers is included.

<sup>3</sup> Securities sold is from securities borrowing and lending agreement.

<sup>4</sup> The offsetting amounts of bonds and debts arising from transactions occurring on the same day between the Korea Exchange and the Company in relation to the client's consignment trading is included. 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Gross amount** | **Offset**<br> **amount** | **Net amounts**<br> **presented in the**<br> **statement of**<br> **financial position** | **Amounts not offset** | **Amounts not offset** | **Net amount** |
| *(in thousands of Korean won)* | **Gross amount** | **Offset**<br> **amount** | **Net amounts**<br> **presented in the**<br> **statement of**<br> **financial position** | **Recognized<br>financial<br>instruments** | **Cash<br>collateral** | **Net amount** |
|  **Financial assets** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives assets, others <sup>1</sup> | 846411930 |  | 846411930 | 544286051 | 235743401 | 66382478 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities purchased under reverse repurchase agreements | 441800000 |  | 441800000 | 441800000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables <sup>4</sup> | 2317397927 | 2307527540 | 9870387 |  |  | 9870387 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other receivables (Payment and settlement) | 105464571 | 99790621 | 5673950 |  |  | 5673950 |
|  | 237030000 |  | 237030000 | 237030000 |  |  |
|  | 3948104428 | 2407318161 | 1540786267 | 1223116051 | 235743401 | 81926815 |
|  **Financial liabilities** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivatives liabilities, others <sup>1</sup> | 1483107954 |  | 1483107954 | 1050325766 | 75252991 | 357529197 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities sold under reverse resale agreements <sup>2</sup> | 13531208950 |  | 13531208950 | 13531208950 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities sold <sup>3</sup> | 2825922918 |  | 2825922918 | 2825922918 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other payables <sup>4</sup> | 2712412451 | 2307527540 | 404884911 |  |  | 404884911 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other payables (Payment and settlement) | 99790621 | 99790621 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Payable unsettled spot exchange | 237100000 |  | 237100000 | 237100000 |  |  |
|  | 20889542894 | 2407318161 | 18482224733 | 17644557634 | 75252991 | 762414108 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

<sup>1</sup> Both of derivatives (trading) and derivatives (hedge) are included.

<sup>2</sup> Securities sold under reverse resale agreements to the customers is included.

<sup>3</sup> Securities sold is from securities borrowing and lending agreement.

<sup>4</sup> The offsetting amounts of bonds and debts arising from transactions occurring on the same day between the Korea Exchange and the Company in relation to the client's consignment trading is included. 

**40. Lease** 

40.1 The amounts recognized in the separate statement of financial position

The amounts related to lease recognized in the separate statement of financial position as at December 31, 2022 and 2021, are as follows;

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Right-of-use assets <sup>1</sup> |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings | 72115792 | 69145814 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vehicles | 2258588 | 1570194 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 1005513 | 1710375 |
|  | 75379893 | 72426383 |
|  Lease liabilities | 121082291 | 123400384 |

---

<sup>1</sup> The amount is included in property and equipment in the separate statement of financial position. 

40.2 The amounts recognized in the separate statement of profit or loss

The amounts related to lease recognized in the separate statement of profit or loss for the year ended December 31, 2022 and 2021, are as follows

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Depreciation of the right-of-use assets |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings | 21758887 | 14623072 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vehicles | 1188483 | 1176069 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 1081530 | 1244144 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;24028900 | &nbsp;&nbsp;&nbsp;&nbsp;17043285 |
|  Interest income from lease receivables (included in financial income) | 1084287 | 1615695 |
|  Interest expense to lease liabilities (included in financial cost) | 3372582 | 2787349 |
|  Lease payment for leases for which the underlying asset is of low value (included in administrative expenses, not-include lease for short-term period) | 586608 | 461035 |
|  Variable lease payments which are not included in the measurement of lease liabilities (included in administrative expenses) | 126576 | 256363 |

---

The total cash outflow for leases in 2022 and 2021 were W 30,835 million and W 32,911 million, respectively.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

40.3 As a Lessor : Financial Lease

As at December 31, 2022 and 2021, total investment on financial lease and present value of minimum lease payments and unrealized interest income of financial lease are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Total Investment on lease | 35135664 | 41127430 |
|  Net Investment on lease | 32271624 | 37179103 |
|  Present value of minimum lease payments | 32271624 | 37179103 |
|  Unrealized interest income | 2864040 | 3948327 |

---

40.4 As a Lessor : Operating Lease

As at December 31, 2022 and 2021, future minimum lease receipts expected under non-cancellable lease contracts are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Within 1 year |  | 1294822 |  | 934595 |
|  1 - 5 years |  | 1824240 |  | 1044287 |
|  |  | &nbsp;&nbsp;&nbsp;&nbsp;3,119,062 |  | &nbsp;&nbsp;&nbsp;&nbsp;1,978,882 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**41. Contingent Liabilities and Commitments** 

As at December 31, 2022 and 2021, the Company is involved in pending lawsuits, are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Number of**<br> **lawsuits** | **Number of**<br> **lawsuits** | **Amount** | **Amount** | **Number of**<br> **lawsuits** | **Number of**<br> **lawsuits** | **Amount** | **Amount** |
|  Defendant |  | 33 |  | 202977447 |  | 21 |  | 176352560 |
|  Plaintiff |  | 8 |  | 177971745 |  | 9 |  | 163067109 |

---

The Company expects that these lawsuits do not have significant impact on the financial position.

The Company has entered into various agreements with financial institutions as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  |  | **Credit line** | **Credit line** |
| *(in thousands of Korean won)* | **Financial institution** | **2022** | **2021** |
|  Overdraft (including daily overdraft) | Kookmin Bank and others | 530000000 | 530000000 |
|  General loan | Kookmin Bank | 40000000 | 40000000 |
|  Securities underwriting loan | KSFC | 600000000 | 700000000 |
|  Working capital loan (general) | KSFC | 475000000 | 375000000 |
|  Note trading at a discount (general) | KSFC | 300000000 | 300000000 |
|  Note trading at a discount (trust) | KSFC | Limit of subscription deposits | Limit of subscription deposits |
|  Bond dealer's loan (general) | KSFC | 500000000 | 850000000 |
|  Securities underwriting financing | KSFC | 1710000000 | 1500000000 |

---

The guarantees and various commitment as at December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Guarantees | 231915900 | 216709400 |
|  Agreement to purchase commercial papers <sup>1</sup> | 337800000 | 576882291 |
|  Loan agreements | 2756152916 | 2066260939 |
|  Credit line agreements | 383468794 | 369691458 |
|  LOC and Investment commitments | 481379395 | 451123929 |
|  | 4190717005 | 3680668017 |

---

<sup>1</sup> According to the above arrangement, the Company holds the asset-backed short-term bonds amounting to W 556,400 million and W 101,660 million as at December 31, 2022 and 2021, respectively. 

The Company has been provided with W 10,731 million and W 12,678 million in guarantees related to provisional attachment and others by Seoul Guarantee Insurance as at December 31, 2022 and 2021, respectively.

The securities in custody as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** | **Valuation method** |
|  Trustor securities | 200379840702 | 155890031762 | Fair value |
|  Saver securities | 308762230 | 232748017 | Fair value |
|  Beneficiary securities | 35441473205 | 32356219560 | Standard selling price |
|  | 236130076137 | 188478999339 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

The Company, as a selling company of qualitied investor private equity fund that aims to lend money to corporations (borrowers) investing in apartment rental business for disabled people in Australia, intermediated W 326.5 billion of trusts and funds to the individuals and institutional investors. However, the local borrower's breach of the contract makes the fund inoperable and there is a possibility of loss of principal.

As at December 31, 2022, three lawsuits were filed to the Company as a defendant. On February 7, 2023, in one case, the first-instance verdict of the trial ordering the payment of a total of W 29.8 billion and delayed interest thereon was announced, but there is a possibility that the conclusion is changed in the upper court, and the other two cases are still in the first instance. The Company has reflected in its financial statements the results of the first-instance verdict handed down on February 7, 2023, as an adjusting event after the reporting period, and has incorporated the related litigation provision liabilities into its financial statements as at December 31, 2022.

Meanwhile, the Company has filed a lawsuit against JB Asset Management Co., Ltd, the fund management company, for compensation, and the first trial is currently in progress.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**42. Related Party Transactions** 

KB Financial Group Inc. owns 100% of ordinary shares of the Company as at December 31, 2022 and 2021.

Significant balances, excluding loan and borrowing transactions, with related parties as at December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Receivables** | **Payables** | **Receivables** | **Payables** |
|  **Subsidiaries** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Securities Hong Kong Ltd. | 128859 | 20063435 | 116043 | 9191784 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Securities Vietnam Joint Stock Company | 355493 | 306736 | 223957 | 211286 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KBFG Securities America Inc. |  |  |  | 65182 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Digital Innovation&growth New Technology Business Investment Fund | 86877 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LB UK Private Real Estate Investment Trust No.18 <sup>1</sup> |  |  | 681145 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 2<sup>nd</sup> Co., Ltd. <sup>1</sup> |  |  |  | 62715 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 1<sup>st</sup> Co., Ltd. |  | 100382 |  | 96924 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Ds 2<sup>nd</sup> Co., Ltd. <sup>1</sup> |  |  | 269941 | 1003862 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Ds 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 83420 | 255252 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Believe Co., Ltd. | 39239 | 104888 | 466986 | 359803 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar IP Co., Ltd. | 142423 | 1232259 | 755420 | 497107 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Panorama 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 1134376 | 366669 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Papyrus Co., Ltd. <sup>1</sup> |  |  | 407947 | 338790 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Songdo Pfive 2<sup>nd</sup> Co., Ltd. | 1561106 | 1837919 | 3555339 | 4434840 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SJ Jongno 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 8243220 | 3937376 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gamsam 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 334055 | 620439 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gongpyeong 1<sup>st</sup> Co., Ltd. |  | 37269 | 344337 | 468315 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Guwol 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  |  | 256796 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gwonseon 1<sup>st</sup> Co., Ltd. |  | 72039 | 1442002 | 1441021 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Sky 1<sup>st</sup> Co., Ltd. | 178493 | 419553 | 876458 | 780527 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Electronics 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 478655 | 457738 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Chowall 1<sup>st</sup> Co., Ltd. | 297012 | 148516 | 687204 | 486393 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Hyosung 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 190304 | 104078 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ABR Mareuk 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 563465 | 531447 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ABR Joongang2 1<sup>st</sup> Co., Ltd. | 973961 | 871561 | 944229 | 981400 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AJH 3<sup>rd</sup> Co., Ltd. <sup>1</sup> |  |  | 51476 | 126089 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; FN Gasan 1<sup>st</sup> Co., Ltd. | 8959 | 11240 | 322267 | 177657 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MS Sejong 4<sup>th</sup> Co., Ltd. <sup>1</sup> |  |  | 23346 | 373287 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Enewstay 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 155607 | 513045 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Pre-IPO <sup>2nd</sup> (TCB) New Technology Business Investment Fund | 132329 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Echo 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 254131 | 348804 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB UK Center 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 276178 | 290164 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Tongyoung 1<sup>st</sup> Co., Ltd. | 1573548 | 1182207 | 2077937 | 2019405 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Paradise Yeongjong 2<sup>nd</sup> Co., Ltd. |  | 1064178 | 561475 | 1190692 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Polar EH 2<sup>nd</sup> Co., Ltd. <sup>1</sup> |  |  | 26282 | 659987 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Polar EH 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 118174 | 523443 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gasan 1<sup>st</sup> Co., Ltd. | 942568 | 765441 | 1752359 | 1912318 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Sewoon Co., Ltd. |  | 236568 | 2247203 | 1100094 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Poongdong 1<sup>st</sup> Co., Ltd.  | 41299 | 7129 | 227757 | 204204 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Receivables** | **Payables** | **Receivables** | **Payables** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Intgreen 1<sup>st</sup> Inc. <sup>1</sup> |  |  | 361090 | 657388 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Infra 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 35629 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; JOSH Bujeon 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 2741628 | 2842912 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Seotan Co., Ltd. <sup>1</sup> |  |  | 2128162 | 2084203 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able PT 1<sup>st</sup> Co., Ltd. | 269733 | 69926 | 1533501 | 1325275 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Pocheon 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 344897 | 331284 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Unbroken 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 2091222 | 2069669 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Plus 1<sup>st</sup> Co., Ltd. | 204849 | 57388 | 821849 | 896938 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB MyeongJi 1<sup>st</sup> Co., Ltd. | 249908 | 126846 | 870712 | 600186 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dangjin 1<sup>st</sup> Co., Ltd. | 308792 | 489479 | 419907 | 484391 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Yongdap 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 747302 | 567291 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Osansegyo 2<sup>nd</sup> Co., Ltd. | 13619 | 26613 | 312312 | 324406 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Hyeongok Co., Ltd. <sup>1</sup> |  |  | 1351045 | 1366250 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Mapo 2<sup>nd</sup> Co., Ltd. | 513806 | 692206 | 789051 | 592990 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GDIC 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 564261 | 553590 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Wonchang 1<sup>st</sup> Co., Ltd. |  | 139851 | 287588 | 228329 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able MK 1<sup>st</sup> Co., Ltd. |  | 86444 |  | 86444 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Zitaress 1<sup>st</sup> Co., Ltd. | 350376 | 190269 | 10432660 | 10386012 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB PF 3<sup>rd</sup> Co., Ltd. <sup>1</sup> |  |  | 232413 | 212241 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Beomeo-one Co., Ltd. | 1774556 | 593665 | 4439050 | 4122473 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Yucheon 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 16351249 | 15733748 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Illite 1st. Co., Ltd. |  |  | 6447 | 13840 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Sina Co., Ltd. | 968887 | 365100 | 150298 | 337985 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Gold 1<sup>st</sup> Co., Ltd. | 1425481 | 1314190 | 1762639 | 1777755 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inspire Gold 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 9475071 | 9295817 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inspire Gold 2<sup>nd</sup> Co., Ltd. | 87364 | 97896 | 6709834 | 6579288 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Yeoksam The Gallery KB 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 1191825 | 1241051 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Y Three Ulsan Sinjeong 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 6868874 | 6964366 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Infra 2<sup>nd</sup> Co., Ltd. |  | 86206 |  | 143103 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Wonsi 1<sup>st</sup> Co., Ltd. | 28356 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 4<sup>th</sup> Co., Ltd. | 195536 | 44559 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HD Value 1<sup>st</sup> Co., Ltd. | 8207 | 41955 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Powerplay 1<sup>st</sup> Co., Ltd. |  | 95134 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dosan 1<sup>st</sup> Co., Ltd. | 797367 | 1730120 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpopoongmoo Co., Ltd. | 23067 | 127710 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Maseok 1<sup>st</sup> Co., Ltd. | 914974 | 699255 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; TW Seocho 1<sup>st</sup> Co., Ltd. | 8481141 | 7285270 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; TW Seocho 2<sup>nd</sup> Co., Ltd. | 3120940 | 2615261 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Wave 1<sup>st</sup> Co., Ltd. | 892590 | 401058 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Lamdamine 1<sup>st</sup> Co., Ltd. | 7126903 | 5759844 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Next 1<sup>st</sup> Co., Ltd. | 827518 | 1117387 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dongil 1<sup>st</sup> Co., Ltd. | 71754 | 112893 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Shiny 1<sup>st</sup> Co., Ltd. | 232119 | 9973 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Enerbil 1<sup>st</sup> Co., Ltd. | 792157 | 334263 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; YSMC 1<sup>st</sup> Co., Ltd. |  | 692262 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HJ Galaxy 3<sup>rd</sup> Co., Ltd. |  | 644713 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB SmartSchool 1<sup>st</sup> Co., Ltd. | 56670 | 630594 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bighouse 7<sup>th</sup> Co., Ltd. | 1135807 | 875237 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Energy 1<sup>st</sup> Co., Ltd. | 7067734 | 5753079 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gyeongsan Logis 1<sup>st</sup> Co., Ltd. | 1491642 | 1164147 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stoke 2<sup>nd</sup> Corp  | 1803511 | 1496159 |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Receivables** | **Payables** | **Receivables** | **Payables** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Seongnam 1<sup>st</sup> Co., Ltd. | 1174561 | 1101968 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KPS Sihwa 1<sup>st</sup> Co., Ltd. | 1495490 | 3769617 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GDIC 2<sup>nd</sup> Co., Ltd. | 2607565 | 2276726 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar NRB First Co., Ltd. | 2247029 | 3541817 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dongtan 1<sup>st</sup> Co., Ltd. | 1567105 | 868475 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 5<sup>th</sup> Co., Ltd. | 5742118 | 5678498 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Everyday 1<sup>st</sup> Co., Ltd. | 45122 | 67630 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cassiopeia 1<sup>st</sup> Co., Ltd. | 350564 | 315741 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Banpo 1<sup>st</sup> Co., Ltd. | 2398331 | 2073686 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Banpo 2<sup>nd</sup> Co., Ltd. | 1012399 | 898385 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gyeonggi Gwangju 1<sup>st</sup> Co., Ltd. | 2577770 | 2363805 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Byeongjeom 1<sup>st</sup> Co., Ltd. | 235285 | 279903 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Piggarden 1<sup>st</sup> Co., Ltd. | 872566 | 837709 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Star Galaxy Towers REIT <sup>1</sup> |  | 3095031 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB NY 1<sup>st</sup> Co., Ltd. |  | 1286629 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Samyoung Co., Ltd. |  | 19894 |  |  |
|  **Parent Company** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Financial Group Inc. | 116502544 | 66137150 | 84740 | 106320356 |
|  **Others** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Kookmin Bank | 76140288 | 149443176 | 65935575 | 55188817 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Asset Management Co., Ltd. | 1479 | 652430 | 1747 | 824381 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Real Estate Trust Co., Ltd. |  | 622 |  | 522 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Investment Co., Ltd. | 627295 | 236 | 154405 | 121 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Credit Information Co., Ltd. |  | 147 |  | 2719 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Data System Co., Ltd. | 856887 | 43007 | 179879 | 235328 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Life Insurance Co., Ltd. | 685561 | 112050 | 790282 | 380519 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Kookmin Card Co., Ltd. | 50551 | 6675546 | 142366 | 7390861 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Savings Bank Co., Ltd. |  | 552 |  | 399 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Capital Co., Ltd. | 96317 | 2201235 | 92710 | 1489116 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Insurance Co., Ltd | 52388172 | 18558988 | 7512920 | 2967593 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Life Insurance Co., Ltd. (former Prudential Life Insurance Co., Ltd.) <sup>2</sup> | 329563 | 651994 | 378566 | 717402 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Wisestar Private Real Estate<br> Fund Investment Trust No. 1 | 7292 |  | 7811 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other funds | 190008 | 9242907 | 2566825 | 4718031 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LB UK Private Real Estate Investment Trust No.19 |  |  | 248353 |  |

---

<sup>1</sup> These companies are not related parties as at December 31, 2022.

<sup>2</sup> Changed company name from Prudential Life Insurance Co., Ltd. to KB Life Insurance Co., Ltd. for the year ended December 31, 2022.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Significant transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Revenue** | **Expenses** | **Revenue** | **Expenses** |
|  **Subsidiaries** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; DGB General Private Real Estate Investment Trust No.8 <sup>1</sup> | 183691 |  | 385703 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; JB New Jersey Private Real Estate Fund <sup>1</sup> | 1128748 |  | 957963 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Securities Hong Kong Ltd. | 162192 | 381682 | 323789 | 346720 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Securities Vietnam Joint Stock Company | 119906 | 155824 | 211236 | 181318 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KBFG Securities America Inc. |  | 2363899 |  | 1109996 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Digital Innovation&growth New Technology Business Investment Fund | 186055 |  | 200000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KTB Aircraft Private Investment Trust No.21-1 | 1028513 |  | 1129492 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LB Irealand Private Real Estate Investment Trust 8 | 4459537 |  | 4433491 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LB UK Private Real Estate Investment Trust No.18 <sup>1</sup> | 988420 |  | 3460949 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Great GM 12<sup>th</sup> Co., Ltd. <sup>1</sup> |  |  | 64336 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Kumo 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 237989 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 2<sup>nd</sup> Co., Ltd. <sup>1</sup> |  |  | 763924 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 1<sup>st</sup> Co., Ltd. | 1258943 |  | 1399309 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Daerim Co., Ltd. <sup>1</sup> |  |  |  | 1083 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Ds 2<sup>nd</sup> Co., Ltd. <sup>1</sup> | 2024271 | 210617 | 1582784 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Ds 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 445737 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Believe Co., Ltd. | 62469 |  | 287723 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar IP Co., Ltd. | 462504 | 1667569 | 1225374 | 1346831 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar SH Co., Ltd. <sup>1</sup> |  |  |  | 22362 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Wanee 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 375598 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Janghyun Co., Ltd. <sup>1</sup> |  |  |  | 185 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar JY Co., Ltd. <sup>1</sup> |  |  | 50934 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Cheonwon Co., Ltd. <sup>1</sup> |  |  | 149626 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Chimsan 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  |  | 21654 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Panorama 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 1466077 | 458175 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Papyrus Co., Ltd. <sup>1</sup> |  | 120109 | 2856637 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Hakgok Co., Ltd. <sup>1</sup> |  |  | 133620 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vestas General Private Real<br> Estate Fund Investment Trust No. 38 | 4740671 |  | 4634891 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Songdo Pseven 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 476916 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Songdo Pfive 2<sup>nd</sup> Co., Ltd. | 2886460 |  | 1554876 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Alpha Spain Real Estate Private<br> Investment Trust 1 <sup>1</sup> |  |  | 2376306 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SJ Jongno 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  | 4305844 | 1685806 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gamsam 1<sup>st</sup> Co., Ltd. <sup>1</sup> | 518988 |  | 1478542 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gorim 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 199781 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gongpyeong 1<sup>st</sup> Co., Ltd. | 226328 |  | 232580 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Guwol 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  | 256522 | 1657905 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gwonseon 1<sup>st</sup> Co., Ltd. | 205349 |  | 990705 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dangsan Co., Ltd. <sup>1</sup> |  |  | 461558 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Daenong Co., Ltd. <sup>1</sup> |  |  | 648944 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Daepo 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 44715 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Mojong 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 295153 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Bukcheonan logis Co., Ltd. <sup>1</sup> |  |  | 872802 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Seoho 1<sup>st</sup> Co., Ltd. <sup>1</sup>  |  |  | 176409 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Revenue** | **Expenses** | **Revenue** | **Expenses** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Sungnae 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 42500 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Sky 1<sup>st</sup> Co., Ltd. | 737660 |  | 595931 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Ali 2<sup>nd</sup> Co., Ltd. <sup>1</sup> |  |  | 321946 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Yongin 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 256778 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Unicity 4<sup>th</sup> Co., Ltd. <sup>1</sup> |  |  | 315590 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Eumsung 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 348135 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Electronics 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 1712184 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Jinjeop 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 39062 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Chowall 1<sup>st</sup> Co., Ltd. | 273416 |  | 860596 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Forsythia 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 241312 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Hana Co., Ltd. <sup>1</sup> |  |  | 92273 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Hyosung 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  | 64009 | 2762765 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ABR Mareuk 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 198279 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ABR Sosa 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 231496 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ABR Joongang2 1<sup>st</sup> Co., Ltd. | 450654 |  | 302038 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AJH 3<sup>rd</sup> Co., Ltd. <sup>1</sup> |  |  | 136511 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; FN Gasan 1<sup>st</sup> Co., Ltd. |  | 45219 | 152743 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MS Sejong 4<sup>th</sup> Co., Ltd. <sup>1</sup> |  | 338558 | 433231 | 1801942 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Enewstay 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 1212559 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Pre-IPO <sup>2nd</sup> (TCB) New Technology<br> Business Investment Fund | 525000 |  | 509250 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Asan Baebang 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 203171 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Ansung 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 1333952 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Echo 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 673291 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Osansaegyo Co., Ltd. <sup>1</sup> |  |  | 789697 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Wondong 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 139857 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB UK Center 1<sup>st</sup> Co., Ltd. <sup>1</sup> | 42236 |  | 432730 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Icheon logistics 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 1183260 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Tongyoung 1<sup>st</sup> Co., Ltd. | 774946 |  | 716845 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB PF 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 5016 | 56558 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KS Beta Co., Ltd. <sup>1</sup> |  |  | 196180 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Crescendo Muju Co., Ltd. <sup>1</sup> |  |  | 872200 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Paradise Yeongjong 2<sup>nd</sup> Co., Ltd. | 553827 |  | 520352 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pacific US BlackRock Private Placement<br> Real Estate Fund Investment Trust No. 15 | 683981 |  | 1171319 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Polar SQ 2<sup>nd</sup> Co., Ltd. <sup>1</sup> |  |  | 31335 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Polar SQ 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 31335 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Polar EH 2<sup>nd</sup> Co., Ltd. <sup>1</sup> |  |  | 448549 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Polar EH 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 504769 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hangang Domestic Private Real Estate Fund No.14 <sup>1</sup> |  |  | 1573959 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Sinchun 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 540917 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Songam Park Development Co., Ltd. <sup>1</sup> |  |  | 746940 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SJ Sejong Co., Ltd. |  |  | 69000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gasan 1<sup>st</sup> Co., Ltd. | 816715 |  | 462819 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Sewoon Co., Ltd. |  | 851397 | 2591808 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Ansan Logistics 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 147843 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Udong 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 53535 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able KJ 1<sup>st</sup> Co., Ltd. |  |  | 15000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Poongdong 1<sup>st</sup> Co., Ltd. | 87336 |  | 784073 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Intgreen 1<sup>st</sup> Inc. <sup>1</sup> |  | 286989 | 2198225 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Daemyung 1<sup>st</sup> Co., Ltd. |  |  |  | 331246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Infra 1<sup>st</sup> Co., Ltd. <sup>1</sup>  |  |  | 478423 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Revenue** | **Expenses** | **Revenue** | **Expenses** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pinetridavil Co., Ltd. <sup>1</sup> |  |  | 148109 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; JOSH Bujeon 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 1889108 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Seotan Co., Ltd. <sup>1</sup> |  |  | 435687 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able PT 1<sup>st</sup> Co., Ltd. | 219020 |  | 241590 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Pocheon 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 526898 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Hyangdong 1<sup>st</sup> Co., Ltd.<sup>1</sup> |  |  | 353553 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Unbroken 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 241491 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Plus 1<sup>st</sup> Co., Ltd. | 419000 |  | 1650919 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB MyeongJi 1<sup>st</sup> Co., Ltd. | 551227 |  | 470527 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dangjin 1<sup>st</sup> Co., Ltd. | 281889 |  | 135951 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Yongdap 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 198537 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Cold Co., Ltd. <sup>1</sup> |  |  | 588135 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Betares Co., Ltd. <sup>1</sup> |  |  | 26730 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Osansegyo 2<sup>nd</sup> Co., Ltd. | 114137 |  | 43931 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Hyeongok Co., Ltd. <sup>1</sup> |  |  | 179795 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Mapo 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 100000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Mapo 2<sup>nd</sup> Co., Ltd. | 1063020 |  | 396061 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hyundai Dynamic Mix Securities Feeder<br> Investment Trust 1 <sup>1</sup> |  |  | 1607304 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hanwha US Equity Strategy Private Real<br> Estate Fund 3 |  |  | 7648350 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GDIC 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  | 30425 | 218392 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Wonchang 1<sup>st</sup> Co., Ltd. | 97919 |  | 120892 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pacific Bric Professional Investors' Private<br> Real Estate Fund #53 <sup>1</sup> |  |  | 1695000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able MK 1<sup>st</sup> Co., Ltd. | 544000 |  | 47693 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Zitaress 1<sup>st</sup> Co., Ltd. | 182213 |  | 820602 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB PF 3<sup>rd</sup> Co., Ltd. <sup>1</sup> |  |  | 20172 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Beomeo-one Co., Ltd. | 901026 |  | 329377 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Yucheon 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  | 606346 | 865337 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Illite 1st. Co., Ltd. |  | 8502 | 8502 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Sina Co., Ltd. | 845729 |  | 488215 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Gold 1<sup>st</sup> Co., Ltd. | 420962 |  | 41821 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inspire Gold 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 245720 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inspire Gold 2<sup>nd</sup> Co., Ltd. | 380715 |  | 180437 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Yeoksam The Gallery KB 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 7499 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Y Three Ulsan Sinjeong 1<sup>st</sup> Co., Ltd. <sup>1</sup> |  |  | 14663 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Infra 2<sup>nd</sup> Co., Ltd. |  | 56897 | 143103 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Investment US Amazon Logistics<br> Private Real Estate Investment Trust NO. 1 <sup>1</sup> | 915909 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GVA Europe Real Estate Investment Trust No.2 <sup>1</sup> | 11556647 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Wonsi 1<sup>st</sup> Co., Ltd. | 427808 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 4<sup>th</sup> Co., Ltd. | 562583 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HD Value 1<sup>st</sup> Co., Ltd. | 38961 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Powerplay 1<sup>st</sup> Co., Ltd. | 94635 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dosan 1<sup>st</sup> Co., Ltd | 2150632 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpopoongmoo Co., Ltd. | 98484 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Maseok 1<sup>st</sup> Co., Ltd. | 875143 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; TW Seocho 1<sup>st</sup> Co., Ltd. | 2116788 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; TW Seocho 2<sup>nd</sup> Co., Ltd. | 947788 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HJ Galaxy 2<sup>nd</sup> Co., Ltd. <sup>1</sup> | 1414000 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HJ Galaxy 1<sup>st</sup> Co., Ltd. <sup>1</sup> | 1414000 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Wave 1<sup>st</sup> Co., Ltd.  | 500069 |  |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Revenue** | **Expenses** | **Revenue** | **Expenses** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Lamdamine 1<sup>st</sup> Co., Ltd. | 1773725 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Next 1<sup>st</sup> Co., Ltd. | 1470156 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Infra 3<sup>rd</sup> Co., Ltd. <sup>1</sup> | 630000 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dongil 1<sup>st</sup> Co., Ltd. | 185822 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Shiny 1<sup>st</sup> Co., Ltd. | 271718 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Enerbil 1<sup>st</sup> Co., Ltd. | 894958 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; YSMC 1<sup>st</sup> Co., Ltd. | 692381 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HJ Galaxy 3<sup>rd</sup> Co., Ltd. | 653388 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB SmartSchool 1<sup>st</sup> Co., Ltd. | 682688 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bighouse 7<sup>th</sup> Co., Ltd. | 2011044 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Energy 1<sup>st</sup> Co., Ltd. | 1328287 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gyeongsan Logis 1<sup>st</sup> Co., Ltd. | 424225 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stoke 2<sup>nd</sup> Corp | 934351 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Sungsoo 1<sup>st</sup> Co., Ltd. <sup>1</sup> | 66571 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Seongnam 1<sup>st</sup> Co., Ltd | 199312 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KPS Sihwa 1<sup>st</sup> Co., Ltd. | 3652496 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GDIC 2<sup>nd</sup> Co., Ltd. | 329231 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar NRB First Co., Ltd. | 2014826 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Dongtan 1<sup>st</sup> Co., Ltd. | 846976 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 5<sup>th</sup> Co., Ltd. | 3488327 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Godeok 1<sup>st</sup> Co., Ltd. |  | 105971 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Godeok 2<sup>nd</sup> Co., Ltd. | 5052 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Everyday 1<sup>st</sup> Co., Ltd. | 84464 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cassiopeia 1<sup>st</sup> Co., Ltd. | 69238 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Banpo 1<sup>st</sup> Co., Ltd. | 324645 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Banpo 2<sup>nd</sup> Co., Ltd. | 113165 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gyeonggi Gwangju 1<sup>st</sup> Co., Ltd. | 375770 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Byeongjeom 1<sup>st</sup> Co., Ltd. | 137383 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Unity 1<sup>st</sup> Co., Ltd. | 9000 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Piggarden 1<sup>st</sup> Co., Ltd. | 39857 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Star Galaxy Towers REIT <sup>1</sup> | 7484969 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB NY 1<sup>st</sup> Co., Ltd. | 1286629 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Samyoung Co., Ltd. | 19894 |  |  |  |
|  **Associates** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.17 <sup>1</sup> |  |  |  | 1067588 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-KDBC New Technology Business Investment Fund | 129289 |  | 189998 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KBTS Technology Venture Private Equity Fund | 185355 |  | 285290 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-SJ Tourism Venture Fund | 209347 |  | 278571 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Keystone-Hyundai Sec. No.1 Private Equity Fund <sup>1</sup> |  |  | 42637 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-Brain KOSDAQ Scale-Up Fund | 422946 |  | 514119 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.18 <sup>1</sup> |  |  | 5886 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB SPROTT Renewable Private Equity Fund I | 345339 |  | 487500 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-Stonebridge Secondary Private Equity Fund | 705744 |  | 549714 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.19 <sup>1</sup> |  |  | 36244 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company No.20 <sup>1</sup> |  |  | 67917 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-UTC Inno-Tech Venture Fund | 449015 |  | 471466 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-SP Private Equity Fund IV  | 210945 |  | 388931 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | 2022 | 2022 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Revenue** | **Expenses** | **Revenue** | **Expenses** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-NAU Special Situation Corporate<br> Restructuring Private Equity Fund | 561064 |  | 1198196 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Material and Parts No. 1 PEF | 352500 |  | 352500 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Bio Private Equity Fund III Ltd. | 4034553 |  | 323836 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; K The fifteenth Real Estate Investment<br> Trust <sup>1</sup> |  |  | 500000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-KTB Technology Venture Fund | 599726 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-GeneN Medical Venture Fund 1 | 76392 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-BridgePole Venture Investment Fund | 117986 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-Kyobo New Mobility Power Fund | 68825 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company<br> No.21 | 1731563 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; THE CHAEUL FUND NO.1 <sup>2</sup> | 81844 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company<br> No.22 | 1157075 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB-NP Green ESG New Technology<br> Venture Capital Fund | 435147 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose Acquisition Company<br> No.23 | 1476465 |  |  |  |
|  **Parent Company** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Financial Group Inc. | 484733 | 20241 | 689158 | 15168 |
|  **Others** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Kookmin Bank | 181573223 | 262812436 | 110412211 | 113932738 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Asset Management Co., Ltd. | 9069 | 1679427 | 9821 | 1108009 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Real Estate Trust Co., Ltd. | 936 | 3010 | 760 | 5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Investment Co., Ltd. | 1902935 | 4 | 616501 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Credit Information Co., Ltd. | 221 | 3 | 218 | 2482 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Data System Co., Ltd. | 955 | 1120617 | 823 | 1348880 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Life Insurance Co., Ltd. | 113129 | 41862 | 322568 | 327902 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Kookmin Card Co., Ltd. | 68448 | 575348 | 111626 | 679936 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Savings Bank Co., Ltd. | 831 | 14 | 227 | 4610 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Capital Co., Ltd. | 305322 | 44652 | 344413 | 478 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Insurance Co., Ltd | 68091902 | 67758399 | 889407 | 5459994 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Life Insurance Co., Ltd. (former Prudential Life Insurance Co., Ltd.) <sup>3</sup> | 644336 | 1004150 | 614560 | 747319 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Wisestar Private Real Estate Fund<br> Investment Trust No. 1 | 2018435 |  | 7255541 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other funds | 18771423 | 12110844 | 5305247 | 510087 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retirement pension | 771613 |  | 598028 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LB UK Private Real Estate Investment<br> Trust No.19 | 304032 |  | 396837 |  |
|  **The Company** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Employees | 344870 |  | 321649 |  |

---

<sup>1</sup> These companies are excluded from related parties during the year ended December 31, 2022 or 2021. The transaction amounts are up to the date of the exclusion. 

<sup>2</sup> Changed company name from SKS IB NEW M&T FUND NO.1 to THE CHAEUL FUND NO.1 for the year ended December 31, 2022.

<sup>3</sup> Changed company name from Prudential Life Insurance Co., Ltd. to KB Life Insurance Co., Ltd. for the year ended December 31, 2022.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Significant loan and borrowing transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | 2022 | 2022 | 2022 | 2022 | 2022 | 2022 |
| *(in thousands of Korean won)* | **Accounts** | **Beginning<br>balance** | **Increase** | **Decrease** | **Other** | **Ending <br>balance** |
|  **Subsidiaries** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 1st Co., Ltd | Loans | 52471330 |  | (26258530) |  | 26212800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gamsam 1st Co., Ltd. <sup>1</sup> | Loans | 22949233 |  | (22949233) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Echo 1st Co., Ltd. <sup>1</sup> | Loans | 14974275 |  | (14974275) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 2nd Co., Ltd. <sup>1</sup> | Loans | 12369667 |  | (12369667) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Infra 1st Co., Ltd. <sup>1</sup> | Loans | 11874477 |  | (11874477) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able MK 1st Co., Ltd. | Loans | 15902044 |  | (3521) |  | 15898523 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Panorama<br> 1st Co., Ltd. <sup>1</sup> | Loans | 9839390 |  | (9839390) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Wonsi 1st Co., Ltd. | Loans |  | 14201867 |  |  | 14201867 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar DS 2nd Co., Ltd. <sup>1</sup> | Loans |  | 800000 | (800000) |  |  |
|  **Associates** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.17 <sup>1</sup> | Hybrid bond with<br>securities-like<br>features | 999500 |  | (999500) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.18 <sup>1</sup> | Hybrid bond with<br>securities-like<br>features | 3058774 |  | (3058774) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.19 <sup>1</sup> | Hybrid bond with<br>securities-like<br>features | 2090861 |  | (2090861) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.20 <sup>1</sup> | Hybrid bond with<br>securities-like<br>features | 3135222 |  |  |  | 3135222 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.21 | Hybrid bond with<br>securities-like<br>features |  | 1490000 |  | 1469063 | 2959063 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.22 | Hybrid bond with<br>securities-like<br>features |  | 990000 |  | 982075 | 1972075 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.23 | Hybrid bond with<br>securities-like<br>features |  | 1495000 |  | 1476465 | 2971465 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.24 | Hybrid bond with<br>securities-like<br>features |  | 6975000 |  |  | 6975000 |
|  **Others** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Kookmin Bank | Deposits <sup>2</sup> | 518051228 |  |  | 317154148 | 835205376 |
|  | Borrowings |  | 868303453 | (868303453) |  |  |
|  **The Company** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Employees | Loans to<br>employees | 14940376 | 2324900 | (5624383) |  | 11640893 |

---

<sup>1</sup> These companies are not related parties as at December 31, 2022.

<sup>2</sup> Transactions such as settlement payments for business reasons and deposits that can be deposited and withdrawn at any time between related parties are disclosed in net amounts. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | 2021 | 2021 | 2021 | 2021 | 2021 | 2021 |
| *(in thousands of Korean won)* | **Accounts** | **Beginning<br>balance** | **Increase** | **Decrease** | **Other** | **Ending <br>balance** |
|  **Subsidiaries** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Panorama 1st Co., Ltd. | Loans | 9845711 |  | (6321) |  | 9839390 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 1st Co., Ltd | Loans | 33527243 |  | (3700384) |  | 29826859 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Newstar Gimpo 2nd Co., Ltd. | Loans |  | 12369667 |  |  | 12369667 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able Gamsam 1st Co.,Ltd. | Loans | 22962057 |  | (12824) |  | 22949233 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able KD 2nd Co., Ltd <sup>1</sup> | Loans | 4592411 |  | (4592411) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Echo 1st Co., Ltd | Loans | 15075090 |  | (100815) |  | 14974275 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hamilton Power First Co., Ltd <sup>1</sup> | Loans | 28956749 |  | (28956749) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Infra 1st Co., Ltd. | Loans |  | 11874477 |  |  | 11874477 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Able MK 1st Co., Ltd. | Loans |  | 15902044 |  |  | 15902044 |
|  **Associates** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.17 | Hybrid bond with<br>securities-like<br>features | 2067088 |  |  | (1067588) | 999500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special Purpose<br> Acquisition<br> Company No.18 | Hybrid bond with<br>securities-like<br>features | 3052888 |  |  | 5886 | 3058774 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special<br> Purpose<br> Acquisition<br> Company No.19 | Hybrid bond with<br>securities-like<br>features | 2054617 |  |  | 36244 | 2090861 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KB Special<br> Purpose<br> Acquisition<br> Company No.20 | Hybrid bond with<br>securities-like<br>features | 3067305 |  |  | 67917 | 3135222 |
|  **Others** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Kookmin Bank | Deposits <sup>2</sup> | 425062348 |  |  | 92988880 | 518051228 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  | 2787298 | 726662134 | (729449432) |  |  |
|  **The Company** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Employees | Loans to<br>employees | 19064459 | 2490240 | (6614323) |  | 14940376 |

---

<sup>1</sup> These companies are not related parties as at December 31, 2021.

<sup>2</sup> Transactions such as settlement payments for business reasons and deposits that can be deposited and withdrawn at any time between related parties are disclosed in net amounts. 

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Other transactions with related parties for the years ended December 31, 2022 and 2021, are as follows:

---

| | | |
|:---|:---|:---|
| *(In thousands of Korean won)* | **2022** | **2022** |
|  | **Contribution** | **Collection and others** |
|  **Subsidiaries** |  |  |
|  KBFG Securities America Inc. |  |  |
|  PT. KB Valbury Sekuritas | 57221997 |  |
|  Heungkuk Global Highclass Private Real Estate Trust 23 <sup>1</sup> |  | 1903215 |
|  DGB General Private Real Estate Investment Trust No.8 <sup>1</sup> |  | 6967178 |
|  Pacific US BlackRock Private Placement Real Estate Fund Investment Trust No. 15 | 3142188 | 198569 |
|  Vestas General Private Real Estate Fund Investment Trust No. 38 | 11340804 |  |
|  JB Dry Street Private Fund 1 |  | 86497 |
|  JB Australia108 Private Fund 1 |  | 61708 |
|  JB Forge Private Fund 1 |  | 44182 |
|  JB Hall Street Private Fund 1 |  | 82632 |
|  JB Margaret Street Private Fund 1 |  | 23401 |
|  LB UK Private Real Estate Investment Trust No.18 <sup>1</sup> |  | 28941213 |
|  Alpha Spain Real Estate Private Investment Trust 1 <sup>1</sup> |  | 67622466 |
|  Hanwha US Equity Strategy Private Real Estate Fund 3 |  | 180885304 |
|  Korea Investment US Amazon Logistics Private Real Estate Investment Trust NO. 1 <sup>1</sup> | 20900000 | 20800000 |
|  GVA Europe Real Estate Investment Trust No.2 <sup>1</sup> | 95000000 | 95000000 |
|  KB Global Contents Private Investment Fund | 4500000 |  |
|  GVA Europe Pre-IPO Private Investment Trust No.1 | 20000000 |  |
|  LIFE Global Reits Pre-IPO General Private Investment Trust 1 | 59470000 |  |
|  KB KBSTAR US Short-Term IG Corporate Bond ETF | 50000000 |  |
|  KB Wisestar Private Real Estate Fund Investment Trust No. 2 <sup>1</sup> | 67100000 |  |
|  **Associates** |  |  |
|  KB Special Purpose Acquisition Company No.17 <sup>1</sup> |  | 500 |
|  KB Special Purpose Acquisition Company No.18 <sup>1</sup> |  | 1000 |
|  KB Special Purpose Acquisition Company No.19 <sup>1</sup> |  | 1000 |
|  KB Special Purpose Acquisition Company No.20 <sup>1</sup> |  | 1000 |
|  KB Special Purpose Acquisition Company No.21 | 10000 |  |
|  KB Special Purpose Acquisition Company No.22 | 10000 |  |
|  KB Special Purpose Acquisition Company No.23 | 5000 |  |
|  KB Special Purpose Acquisition Company No.24 | 25000 |  |
|  KB New Paradigm Agriculture Venture Fund |  | 625000 |
|  KB-KDBC New Technology Business Investment Fund |  | 2600000 |
|  KBTS Technology Venture Private Equity Fund |  | 1296000 |
|  KB-SJ Tourism Venture Fund |  | 400000 |
|  KB Shinjasanaubo Fund |  | 132000 |
|  KB-Brain KOSDAQ Scale-Up Fund |  | 4800000 |
|  KB SPROTT Renewable Private Equity Fund I | 2499360 |  |
|  KB-Stonebridge Secondary Private Equity Fund | 1248439 | 631500 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 660000 | 2352793 |
|  Project Vanilla Co., Ltd. <sup>1</sup> |  | 525344 |
|  KB Bio Private Equity Fund III Ltd. <sup>1</sup> |  | 10000000 |
|  KB-KTB Technology Venture Fund | 4000000 |  |
|  KB Digital Platform Fund | 5000000 |  |
|  KB-SOLIDUS Healthcare Investment Fund | 1000000 |  |
|  KB-GeneN Medical Venture Fund 1 | 2000000 |  |
|  KB-BridgePole Venture Investment Fund | 850000 |  |
|  KB-Kyobo New Mobility Power Fund | 3000000 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | |
|:---|:---|:---|
|  JS Private Equity Fund III | 1700000 |  |
|  Mirae Asset Mobility Investment Fund I | 2000000 |  |
|  KB-FT 1st Green Growth Investment Fund | 2000000 |  |
|  THE CHAEUL FUND NO.1 <sup>2</sup> | 1000000 |  |
|  POSITIVE Sobujang Venture Fund No.1 | 2000000 |  |
|  KB-NP Green ESG New Technology Venture Capital Fund | 3740000 |  |
|  Hisstory 2022 Fintech Fund | 2000000 |  |
|  PEBBLES-MW M.C.E New Technology Investment Fund 1st | 2000000 |  |
|  KB Star REIT | 45523300 |  |
|  KB Bio Private Equity Investment Fund IV | 7500000 |  |
|  Nextrade Co., Ltd. | 9700000 |  |
|  Apollo REIT PropCo LLC <sup>1</sup> | 19968049 | 19968049 |
|  **Others** |  |  |
|  Star-Lord General Investors Private Real Estate Investment Company No.10 | 20000000 |  |
|  KB NA Compass Energy Private Special Asset Fund <sup>1</sup> | 606975 | 21823276 |
|  Meritz Private Real Estate Fund 9-2 | 1486 | 5306 |
|  KB Global Core Bond Securities Master Fund(Bond) |  | 5000000 |
|  KB Global Platform Fund | 3200000 | 2460000 |
|  KB Wisestar Private Real Estate Fund Investment Trust No. 1 |  | 1749177 |
|  KB KBSTAR 30-Years Treasurybond Enhanced ETF <sup>1</sup> |  | 691351 |
|  KB Aircraft Loan Private Special Asset Fund Investment Trust No. 1 |  | 32265511 |
|  KB New Deal Innovation Fund | 4800000 |  |
|  KB Development Blind General Private Real Estate Investment Trust No.2 | 3240000 |  |
|  KB Prime Digital Platform Fund | 900000 |  |
|  KB Secondary Plus Fund | 1180000 |  |
|  Paramark KB Fund I | 4148023 | 772023 |
|  KB Scale-up Fund No.2 | 1500000 |  |
|  KB KBSTAR Nov 2023 Term Credit ETF | 14862445 | 4905170 |

---

<sup>1</sup> No related party of the Company as at December 31, 2022.

<sup>2</sup> Changed company name from SKS IB NEW M&T FUND NO.1 to THE CHAEUL FUND NO.1 for the year ended December 31, 2022.

---

| | | |
|:---|:---|:---|
| *(In thousands of Korean won)* | **2021** | **2021** |
|  | **Contribution** | **Collection and others** |
|  **Subsidiaries** |  |  |
|  KB Securities Hong Kong Ltd. | 101175500 |  |
|  KB Securities Vietnam Joint Stock Company | 69084068 |  |
|  Aquila Global Real Assets Fund No. 1 LP <sup>1</sup> |  | 1 |
|  KB Pre-IPO 2nd (TCB) New Technology Business Investment Fund | 11250000 |  |
|  Pacific US Blackrock Private Placement Real Estate Fund No.15 | 3325797 |  |
|  DGB General Private Real Estate Investment<br> Trust No.8 |  | 360460 |
|  Hyundai Dynamic Mix Securities Feeder Investment Trust 1 <sup>1</sup> |  | 5559136 |
|  KB digital innovation & growth new technology business investment fund | 500000 |  |
|  Alpha Spain Real Estate Private Investment Trust 1 | 3298743 |  |
|  Hangang Domestic Private Real Estate Fund No.14 <sup>1</sup> |  | 18100000 |
|  Heungkuk Global Highclass Private Real Estate Trust 23 |  | 1630765 |
|  Hanwha US Equity Strategy Private Real Estate Fund 3 | 183678409 | 8695 |
|  Hyundai Kon-tiki Specialized Privately Placed Fund 1 <sup>1</sup> |  | 476406 |
|  Pacific Bric Professional Investors' Private Real Estate Fund No.53 <sup>1</sup> | 43500000 | 43500000 |
|  **Associates** |  |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | |
|:---|:---|:---|
|  KB New Paradigm Agriculture Venture Fund |  | 2275000 |
|  KB KONEX Market Vitalization Fund |  | 5550000 |
|  KB-KDBC Pre-IPO New Technology Business Investment Fund |  | 2400000 |
|  KBTS Technology Venture Private Equity Fund | 880000 | 1536000 |
|  KB-SJ Tourism Venture Fund | 500000 |  |
|  KB-Brain KOSDAQ Scale-Up Fund | 3750000 | 4050000 |
|  KB-Stonebridge Secondary Private Equity Fund | 3788000 | 1692584 |
|  KB-UTC Inno-Tech Venture Fund | 1695000 | 375000 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | 3846000 |  |
|  KB Shinjasanaubo Fund | 880000 | 264000 |
|  JR GLOBAL REIT <sup>1</sup> |  | 65025000 |
|  Keystone-Hyundai Sec. No.1 Private Equity Fund <sup>1</sup> |  | 1925000 |
|  K The fifteenth Real Estate Investment Trust <sup>1</sup> | 8600000 | 8600000 |
|  KB Private Equity Fund III <sup>1</sup> |  | 8 |
|  KB Bio Private Equity Fund III Ltd. | 10000000 |  |
|  KB Global Commerce Private Equity Investment Fund | 7000000 |  |
|  KB-KTB Technology Venture Fund | 2000000 |  |
|  KB Bio Global Expansion Private Equity Fund No.1 | 15000000 |  |
|  KB Digital Platform Fund | 4500000 |  |
|  KB-SOLIDUS Healthcare Investment Fund | 100000 |  |
|  **Others** |  |  |
|  KB NA COMPASS ENERGY PRIVATE SPECIAL ASSET FUND | 1513600 | 2056553 |
|  Meritz Private Real Estate Fund 9-2 | 1053 | 5954 |
|  KB Global Core Bond Securities Master Fund(Bond) |  | 15000000 |
|  KB Onkookmin TDF 2045 Fund |  | 1400000 |
|  KB Global Platform Fund | 5400000 |  |
|  KB Onkookmin Life Income RIF 20 Feeder Fund(FoFs) |  | 2500000 |
|  KB Onkookmin Life Income RIF 40 Feeder Fund(FoFs) |  | 2500000 |
|  KB BMO senior loan private special asset fund 2 | 4477004 |  |
|  KB Multi Alpha Plus Private Fund 1 | 10000000 |  |
|  KB KBSTAR 30-Years Treasurybond Enhanced ETF | 6311671 | 5806617 |
|  KB Aircraft Loan Private Special Asset Fund Investment Trust No. 1 | 33017696 | 752186 |
|  KB New Deal Innovation Fund | 2000000 |  |
|  Paramark KB Fund I | 680000 |  |

---

<sup>1</sup> No related party of the Company as at December 31, 2021.

Details of payment guarantees and other similar contracts with related parties as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Description** | **Amounts** | **Amounts** |
| *(in thousands of Korean won)* | **Description** | **2022** | **2021** |
|  KB Securities Vietnam Joint Stock Company | Payment guarantees | 92512900 | 86304400 |
|  KB Securities Hong Kong Ltd. | Payment guarantees | 139403000 | 130405000 |
|  MS Sejong 4th Co., Ltd. <sup>1</sup> | Loans purchase agreement |  | 2000000 |
|  KB UK Center 1st Co., Ltd. <sup>1</sup> | Replenishment of loan |  | 12600000 |
|  AJH 3rd Co., Ltd. <sup>1</sup> | Credit line |  | 11000000 |
|  Paradise Yeongjong 2nd Co., Ltd. | Private placement bonds purchase agreement | 20000000 | 20000000 |
|  Able Gwonseon 1st Co., Ltd. | Private placement bonds purchase agreement | 11000000 | 35000000 |
|  Newstar IP Co., Ltd. | Private placement bonds purchase agreement | 50700000 | 50700000 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Description** | **Amounts** | **Amounts** |
| *(in thousands of Korean won)* | **Description** | **2022** | **2021** |
|  Newstar Ds 1st Co., Ltd. <sup>1</sup> | Private placement bonds<br> purchase agreement |  | 15000000 |
|  Newstar Ds 2nd Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 37000000 |
|  Newstar Papyrus Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 24200000 |
|  SJ Jongno 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 68200000 |
|  Enewstay 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 25600000 |
|  Able Gamsam 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 17000000 |
|  Songdo PFive 2nd Co., Ltd. | Private placement bonds purchase agreement | 92607000 | 121821000 |
|  Polar EH 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 2411809 |
|  Polar EH 2nd Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 12391709 |
|  Able Gongpyeong 1st Co., Ltd | Private placement bonds purchase agreement | 20000000 | 20000000 |
|  Newstar Believe Co., Ltd. | Private placement bonds purchase agreement | 7500000 | 7500000 |
|  Able Chowall 1st Co., Ltd. | Credit line | 15900000 | 30000000 |
|  FN Gasan 1st Co., Ltd. | Private placement bonds purchase agreement | 3390000 | 6538462 |
|  ABR Mareuk 1st Co., Ltd. <sup>1</sup> | Credit line |  | 10300000 |
|  ABR Joongang2 1st Co., Ltd. | Credit line | 20000000 | 20000000 |
|  KB Echo 1st Co., Ltd <sup>1</sup> | Credit line |  | 30000000 |
|  KB Tongyoung 1st Co., Ltd. | Credit line | 29193000 | 34000000 |
|  Able Electronics 1st Co., Ltd. <sup>1</sup> | Credit line |  | 70000000 |
|  Able Guwol 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 41900000 |
|  Able Hyosung 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 17000000 |
|  Able Sky 1st Co., Ltd. | Private placement bonds purchase agreement | 30000000 | 30000000 |
|  Newstar Gimpo 2nd Co., Ltd. <sup>1</sup> | Credit line |  | 12600000 |
|  Intgreen 1st Inc. <sup>1</sup> | Private placement bonds purchase agreement |  | 47500000 |
|  Able Gasan 1st Co., Ltd. | Credit line | 60000000 | 60000000 |
|  Able Sewoon Co., Ltd. | Private placement bonds purchase agreement | 37300000 | 48000000 |
|  Able Poongdong 1st Co., Ltd. | Credit line | 2150000 | 4850000 |
|  Zitaress 1st Co., Ltd. | Private placement bonds purchase agreement | 30000000 | 120000000 |
|  KB PF 3rd Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 4500000 |
|  Able Beomeo-one Co., Ltd. | Private placement bonds purchase agreement | 30000000 | 30000000 |
|  Able Yucheon 1st Co., Ltd. <sup>1</sup> | Credit line |  | 160000000 |
|  KB Infra 2nd Co., Ltd. | Private placement bonds purchase agreement | 26000000 | 58500000 |
|  KB Illite 1st. Co.,Ltd. <sup>1</sup> | Credit line |  | 1000000 |
|  Newstar Sina Co., Ltd. | Private placement bonds in foreign currency purchase agreement | 26106380 | 24421300 |
|  KB Gold 1st Co., Ltd. | Credit line | 20000000 | 20000000 |
|  Inspire Gold 1st Co., Ltd. <sup>1</sup> | Credit line |  | 100000000 |
|  Inspire Gold 2nd Co., Ltd. | Credit line | 7000000 | 50000000 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Description** | **Amounts** | **Amounts** |
| *(in thousands of Korean won)* | **Description** | **2022** | **2021** |
|  Yeoksam The Gallery KB 1st Co., Ltd.<sup>1</sup> | Credit line |  | 25000000 |
|  Y Three Ulsan Sinjeong 1st Co., Ltd.<sup>1</sup> | Private placement bonds purchase agreement |  | 59000000 |
|  Newstar Seotan Co., Ltd. <sup>1</sup> | Credit line |  | 63000000 |
|  Newstar Plus 1st Co., Ltd. | Private placement bonds purchase agreement | 16000000 | 16000000 |
|  Unbroken 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 30000000 |
|  Able Dangjin 1st Co., Ltd. | Credit line | 35000000 | 35000000 |
|  Able Yongdap 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 29000000 |
|  Able Wonchang 1st Co., Ltd. | Credit line | 10000000 | 20000000 |
|  Able Pocheon 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 12300000 |
|  Able PT 1st Co., Ltd | Private placement bonds purchase agreement | 5000000 | 5000000 |
|  Able Hyeongok Co., Ltd. <sup>1</sup> | Credit line |  | 60000000 |
|  JOSH Bujeon 1st Co., Ltd. <sup>1</sup> | Credit line |  | 90000000 |
|  GDIC 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  | 40000000 |
|  KB Mapo 2nd Co., Ltd. | Private placement bonds purchase agreement | 10000000 | 10000000 |
|  KB MyeongJi 1st Co., Ltd. | Credit line | 20000000 | 45000000 |
|  KB Osansegyo 2nd Co., Ltd. | Private placement bonds purchase agreement | 8026650 | 8626660 |
|  Newstar Gimpo 4th Co., Ltd. | Private placement bonds purchase agreement | 7000000 |  |
|  Newstar Gimpopoongmoo Co., Ltd. | Credit line | 20000000 |  |
|  Newstar Wave 1st Co., Ltd. | Credit line | 40000000 |  |
|  Lamdamine 1st Co., Ltd. | Credit line | 118000000 |  |
|  Able Dosan 1st Co., Ltd. | Credit line | 54419000 |  |
|  Able Maseok 1st Co., Ltd. | Credit line | 50000000 |  |
|  HD Value 1st Co., Ltd. | Private placement bonds purchase agreement | 3000000 |  |
|  HJ Galaxy 2nd Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  |  |
|  HJ Galaxy 1st Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  |  |
|  KB Star Galaxy Towers REIT | Funding replenishment agreement B | 40000000 |  |
|  TW Seocho 2nd Co., Ltd. | Private placement bonds purchase agreement | 30000000 |  |
|  TW Seocho 1st Co., Ltd. | Credit line | 220000000 |  |
|  Powerplay 1st Co., Ltd. | Private placement bonds purchase agreement | 15000000 |  |
|  Able Next 1st Co., Ltd. | Private placement bonds purchase agreement | 21000000 |  |
|  KB Infra 3rd Co., Ltd. <sup>1</sup> | Private placement bonds purchase agreement |  |  |
|  Able Dongil 1st Co., Ltd. | Private placement bonds purchase agreement | 34000000 |  |
|  Newstar Shiny 1st Co., Ltd. | Private placement bonds purchase agreement | 10000000 |  |
|  Newstar Enerbil 1st Co., Ltd. | Private placement bonds purchase agreement | 100000000 |  |
|  YSMC 1st Co., Ltd. | Private placement bonds purchase agreement | 49500000 |  |
|  HJ Galaxy 3rd Co., Ltd. | Credit line | 46100000 |  |
|  KB SmartSchool 1st Co., Ltd. | Private placement bonds purchase agreement | 20000000 |  |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

---

| | | | |
|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Description** | **Amounts** | **Amounts** |
| *(in thousands of Korean won)* | **Description** | **2022** | **2021** |
|  Bighouse 7th Co., Ltd. | Credit line | 138000000 |  |
|  Newstar Energy 1st Co., Ltd. | Private placement bonds purchase agreement | 141733828 |  |
|  Gyeongsan Logis 1st Co., Ltd | Credit line | 38000000 |  |
|  KB Samyoung Co., Ltd. | Private placement bonds purchase agreement | 6000000 |  |
|  Stoke 2nd Corp | Credit line | 73000000 |  |
|  Newstar Seongnam 1st Co., Ltd | Credit line | 35000000 |  |
|  KPS Sihwa 1st Co., Ltd. | Private placement bonds purchase agreement | 257000000 |  |
|  GDIC 2nd Co., Ltd. | Credit line | 38000000 |  |
|  KB NY 1st Co., Ltd. | Private placement bonds purchase agreement | 92000000 |  |
|  Newstar NRB First Co., Ltd. | Credit line | 44877058 |  |
|  Able Dongtan 1st Co., Ltd. | Private placement bonds purchase agreement | 40000000 |  |
|  Newstar Gimpo 5th Co., Ltd. | Private placement bonds purchase agreement | 180000000 |  |
|  Cassiopeia 1st Co., Ltd. | Private placement bonds purchase agreement | 30000000 |  |
|  Able Banpo 1st Co., Ltd. | Private placement bonds purchase agreement | 15000000 |  |
|  Able Banpo 2nd Co., Ltd. | Private placement bonds purchase agreement | 10000000 |  |
|  Able Gyeonggi Gwangju 1st Co., Ltd. | Private placement bonds purchase agreement | 40000000 |  |
|  Newstar Byeongjeom 1st Co., Ltd. | Private placement bonds purchase agreement | 40000000 |  |
|  Piggarden 1st Co., Ltd. | Private placement bonds purchase agreement | 50000000 |  |

---

<sup>1</sup> No related party of the Company as at December 31, 2022.

As at December 31, 2022, the Company recognizes financial guarantee liability amounting to W 55,032 million (W 95,553 million in 2021) in conjunction with the above.

Details of assets pledged as collateral to related parties as at December 31, 2022 and 2021 is as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **Details of**<br> **assets pledged** | **2022** | **2022** | **2021** | **2021** |
|  |  | **Carrying<br>amount** | **Collateralized<br>amount** | **Carrying<br>amount** | **Collateralized<br>amount** |
|  Kookmin Bank | Time deposits and others | 173000000 | 167000000 | 173000000 | 167000000 |
|  | Bonds denominated in Korean won | 16541459 | 20000000 | 21183449 | 20000000 |

---

As at December 31, 2022, the Company received securities amounting to W 62,000 million(W 54,000 million in 2021) as a collateral from Kookmin bank and the Company has W 140,000 million (W 140,000 million in 2021) of credit line such as loan agreement.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Details of unused loan commitments provided to the related parties as at December 31, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  |  | **Amounts** | **Amounts** |
| *(In thousands of Korean won)* | **Details** | **2022** | **2021** |
|  KB BMO senior loan private special asset fund | Purchase agreements of securities | 19497 | 18239 |
|  KB Global Infra Private Special Asset Fund No.5 | Purchase agreements of securities | 4999773 | 4999773 |
|  KB Global Infra Private Special Asset Fund No.6 | Purchase agreements of securities | 4999773 | 4999773 |
|  KB-KTB Technology Venture Fund | Purchase agreements of securities | 4000000 | 8000000 |
|  KB-NAU Special Situation Corporate Restructuring Private Equity Fund | Purchase agreements of securities | 7644000 | 8304000 |
|  KB-SOLIDUS Healthcare Investment Fund | Purchase agreements of securities | 3900000 | 4900000 |
|  KB Wisestar Private Real Estate Fund Investment Trust No. 1 | Purchase agreements of securities | 19000 | 19000 |
|  KB Global Platform Fund | Purchase agreements of securities |  | 3200000 |
|  KB New Deal Innovation Fund | Purchase agreements of securities | 3200000 | 8000000 |
|  KB Digital Platform Fund | Purchase agreements of securities | 40500000 | 45500000 |
|  KB-Stonebridge Secondary Private Equity Fund | Purchase agreements of securities |  | 1594000 |
|  Paramark KB Fund I | Purchase agreements of securities | 5944000 | 9320000 |
|  Pacific US BlackRock Private Placement Real Estate Fund Investment Trust No. 15 | Purchase agreements of securities | 4525921 | 5645131 |
|  KB Prime Digital Platform Fund | Purchase agreements of securities | 3600000 |  |
|  KBTS Technology Venture Private Equity Fund | Purchase agreements of securities |  | 176000 |
|  KB SPROTT Renewable Private Equity Fund I | Purchase agreements of securities |  | 3817225 |
|  KB-NP Green ESG New Technology Venture Capital Fund | Purchase agreements of securities | 16260000 |  |
|  KB Secondary Plus Fund | Purchase agreements of securities | 1181000 |  |
|  KB Scale-up Fund No.2 | Purchase agreements of securities | 8500000 |  |

---

The Company received credit card commitment amounting to W 21,000 million(W 21,000 million in 2021) from Kookmin Card Co., Ltd. as at December 31, 2022.

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Debt instruments purchased or sold via the Company by the related party for the years ended December 31, 2022 and 2021, are as follows.

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** |
|  | **Sale** | **Purchase <sup>1</sup>** |
|  Kookmin Bank | 7341903732 | 3791777742 |
|  KB Life Insurance Co., Ltd. | 92619359 | 11922239 |
|  KB Insurance Co., Ltd. | 794858152 | 362105311 |
|  KB Life Insurance Co., Ltd. (former Prudential Life Insurance Co., Ltd.) <sup>2</sup> | 65611000 | 325130900 |
|  KB Kookmin Card Co., Ltd. |  | 70000000 |
|  KB Capital Co., Ltd. |  | 70000000 |

---

<sup>1</sup> Debt instruments issued by the related party and purchased by the Company for the year ended December 31, 2022, are included.

<sup>2</sup> Changed company name from Prudential Life Insurance Co., Ltd. to KB Life Insurance Co., Ltd. for the year ended December 31, 2022.

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2021** | **2021** |
|  | **Sale** | **Purchase <sup>1</sup>** |
|  Kookmin Bank | 9642170271 | 9005606675 |
|  KB Life Insurance Co., Ltd. | 272656940 | 88646788 |
|  KB Insurance Co., Ltd. | 853998306 | 446196491 |
|  KB Kookmin Card Co., Ltd. |  | 40000000 |
|  KB Capital Co., Ltd. |  | 130000000 |

---

<sup>1</sup> Debt instruments issued by the related party and purchased by the Company for the year ended December 31, 2022 and 2021, are included.

The key management includes registered or unregistered directors, members of BOD, CFO, person in charge for internal audit and their compensation for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Short-term salaries |  | 19619299 |  | 9493422 |
|  Post-employment benefits |  | 654295 |  | 579895 |
|  Share-based payment |  | 10499614 |  | 16001106 |
|  |  | 30773208 |  | 26074423 |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

**43. Supplemental Cash Flow Information** 

Adjustments for non-cash items of cash flows from operating activities for the years ended December 31, 2022 and 2021, consist of the following:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Interest income | (1013459677) | (737552790) |
|  Interest expenses | 501613637 | 212429225 |
|  Dividend income and distribution income | (49602892) | (43442376) |
|  Tax expenses | 60247522 | 214559285 |
|  Gains on valuation of financial assets (liabilities) required to be mandatorily measured at FVTPL | (328703135) | (258480104) |
|  Losses on valuation of financial assets (liabilities) required to be mandatorily measured at FVTPL | 806205848 | 409884788 |
|  Gains on valuation of financial assets (liabilities) designated at FVTPL | (1034347105) | (602482365) |
|  Losses on valuation of financial assets (liabilities) designated at FVTPL | 101117268 | 170830700 |
|  Gains on valuation of derivative financial assets (liabilities) | (3746153750) | (1522684712) |
|  Losses on valuation of derivative financial assets (liabilities) | 3948207231 | 1657639495 |
|  Gains or losses on disposal of financial assets at FVOCI | 16397562 | 10811918 |
|  Foreign currency translations | 41979344 | (56312965) |
|  Provision for allowances for loan losses | 7287630 | 5378133 |
|  Gains on disposal of investments in associates and subsidiaries | (51192525) | (12324064) |
|  Losses on disposal of investments in associates and subsidiaries | 1931820 | 3817216 |
|  Impairment loss on investments in associates and subsidiaries | 8794479 | 7884327 |
|  Depreciation | 47503080 | 41908757 |
|  Reversal of loss on revaluation of property and equipment | (72800) |  |
|  Loss on revaluation of property and equipment | 451905 |  |
|  Amortization | 27565313 | 22148402 |
|  Others | 107184858 | 72730119 |
|  | (547044387) | (403257011) |

---

Changes in operating assets and liabilities of cash flows for the years ended December 31, 2022 and 2021, consist of the following:

---

| | | |
|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2021** |
|  Deposits in financial institutions | (544320532) | (73947140) |
|  Financial assets required to be mandatorily measured at FVTPL | 4324803821 | (632998030) |
|  Derivative financial instruments/liabilities (net) | 384354248 | (37400973) |
|  Loans measured at amortised cost | (1148722781) | (425945416) |
|  Other assets | 978081409 | 3122483949 |
|  Deposit liabilities | (1623120095) | 699427267 |
|  Financial liabilities required to be mandatorily measured at FVTPL | (649762362) | 978686697 |
|  Financial liabilities designated at FVTPL | 1913728689 | (185467288) |
|  Defined benefit obligation | (20866451) | (16828530) |
|  Securities sold under repurchase agreements | (2784278687) | (1240816274) |
|  Other liabilities | (1212573912) | (3218157158) |
|  | (382676653) | (1030962896) |

---

------

##### [**Table of Contents**](#toc)
**KB SECURITIES Co., Ltd.** 

**Notes to the Separate Financial Statements** 

**December 31, 2022 and 2021** 

------

Changes in liabilities of cash flows from financing activities for the years ended December 31, 2022 and 2021, consist of the following:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2022** | **2022** | **2022** | **2022** | **2022** | **2022** |
| *(in thousands of Korean won)* | **Borrowings** | **Debentures** | **Guarantee<br>deposits** | **Lease<br>liabilities** | **Other**<br> **liabilities** | **Total** |
|  Beginning balance (net) | 12681141171 | 2340179481 | 7319921 | 123400384 |  | 15152040957 |
|  Cash Transactions | 1867511733 | (520000000) | 518525 | (30122914) | 2911250 | 1320818594 |
|  Non-cash transactions | (801461) | 26245908 | 102363 | 27804821 | 41507 | 53393138 |
|  Ending balance(net) | 14547851443 | 1846425389 | 7940809 | 121082291 | 2952757 | 16526252689 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2021** | **2021** | **2021** | **2021** | **2021** |
| *(in thousands of Korean won)* | **Borrowings** | **Debentures** | **Guarantee<br>deposits** | **Lease<br>liabilities** | **Total** |
|  Beginning balance (net) | 12498622381 | 1797596969 | 10782775 | 143799238 | 14450801363 |
|  Cash Transactions | 181842566 | 538296970 | (3575926) | (31849047) | 684714563 |
|  Non-cash transactions | 676224 | 4285542 | 113072 | 11450193 | 16525031 |
|  Ending balance(net) | 12681141171 | 2340179481 | 7319921 | 123400384 | 15152040957 |

---

**44. Non-cash Transactions** 

Significant non-cash transactions from investing activities and financing activities which are not included in separate statements of cash flows for the years ended December 31, 2022 and 2021, are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(in thousands of Korean won)* | **2022** | **2022** | **2021** | **2021** |
|  Increase due to gains on valuation of financial assets at FVOCI |  | 19904095 |  | 13976607 |

---

**45. Event after the reporting period** 

The Company intermediated a fund related to the apartment rental business for disabled people in Australia, but the fund was suspended due to the breach of contract by the local Australian borrower. In this regard, as at December 31, 2022, three lawsuits such as claims for recovery of unjust enrichment have been filed from institutional investors. Among three lawsuits, the first-instance verdict for the one case was announced on February 7, 2023, ordering the payment of the investment principal and delayed interest thereon. This is an adjusting event after the reporting period, and as at December 31, 2022, litigation provision liabilities for three litigation have been added to the financial statements. The specifics of the relevant litigation is described in Note 41.

------

##### [**Table of Contents**](#toc)
**Independent Auditors' Review Report on Internal Control over Financial Reporting** 

(Based on a report originally issued in Korean)

To the Chief Executive Officer of

KB Securities Co., Ltd.:

We have reviewed the accompanying management's report on the effectiveness of Internal Control over Financial Reporting ("ICFR") of KB Securities Co., Ltd. ("the Company") as of December 31, 2022. The Company's management is responsible for designing and maintaining effective ICFR and for its assessment of the effectiveness of the ICFR. Our responsibility is to review management's assessment and issue a report based on our review. In the accompanying report of management's assessment of the ICFR, the Company's management stated: "Based on the assessment results, Chief Executive Officer and ICFR Officer believe that the Company's ICFR, as at December 31, 2022, is designed and operated effectively, in all material respects, in conformity with 'Conceptual Framework for Designing and Operating Internal Control over Financial Reporting'."

We conducted our review in accordance with the ICFR Review Standards, issued by the Korean Institute of Certified Public Accountants. Those Standards require that we plan and perform the review to obtain assurance of a level less than that of an audit as to whether the management's report on the effectiveness of ICFR is free of material misstatement. Our review consists principally of obtaining an understanding of the Company's ICFR, inquiries of the Company personnel about the details of the report, and tracing to related documents we considered necessary in the circumstances.

A company's ICFR is a system to monitor and operate those policies and procedures designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with Korean International Financial Reporting Standards. Because of its inherent limitations, however, ICFR may not prevent or detect a material misstatement of the financial statements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Based on our review, nothing has come to our attention that the management's report on the effectiveness of ICFR as of December 31, 2022 is not prepared, in all material respects, in accordance with 'Best Practice Guideline of Internal Control over Financial Reporting'.

Our review is based on the Company's ICFR as of December 31, 2022. We did not review the Company's ICFR subsequent to December 31, 2022. This report has been prepared for Korean regulatory purposes, pursuant to the Act on External Audit of Stock Companies, Etc. and may not be appropriate for other purposes or for other users.

/s/ KPMG Samjong Accounting Corp.

Seoul, Korea

March 7, 2023

------

##### [**Table of Contents**](#toc)
**Report on the Effectiveness of Internal Control over Financial Reporting** 

(English Translation of a Report Originally Issued in Korean)

To the Shareholders, Board of Directors and Audit Committee of

KB Securities Co., Ltd.

We, as the Chief Executive Officer ("CEO") and the Internal Control over Financial Reporting ("ICFR") Officer of KB Securities Co., Ltd. (the "Company"), assessed the effectiveness of the design and operation of the Company's Internal Control over Financial Reporting for the year ended December 31, 2022.

The Company's management, including ourselves, is responsible for designing and operating ICFR. We assessed the design and operating effectiveness of ICFR in the prevention and detection of an error or fraud which may cause material misstatements in the preparation and disclosure of reliable financial statements.

We designed and operated ICFR in accordance with 'Conceptual Framework for Designing and Operating Internal Control over Financial Reporting' established by the Operating Committee of Internal Control over Financial Reporting in Korea (the "ICFR Committee"). And we conducted an evaluation of ICFR based on 'Best Practice Guideline for Evaluating and Reporting Effectiveness of Internal Control over Financial Reporting' established by the ICFR Committee.

Based on the assessment results, we believe that the Company's ICFR, as at December 31, 2022, is designed and operated effectively, in all material respects, in conformity with 'Conceptual Framework for Designing and Operating Internal Control over Financial Reporting'.

We certify that this report does not contain any untrue statement of a fact, or omit to state a fact necessary to be presented herein. We also certify that this report does not contain or present any statement which cause material misunderstandings, and we have reviewed and verified this report with sufficient due care.

March 3, 2023

Park, Jung Lim, Chief Executive Officer

Chang, Seung Ho, Internal Accounting Controller Officer