- Published 2026.11.07 00:02
Funding plan revised on market volatility and rising borrowing costs
Third-quarter loss and NPL ratio above 10% weigh on decision
KB Bank, the Indonesian subsidiary of KB Kookmin Bank, has abruptly postponed a planned $300 million (about 420 billion won) global dollar bond sale, citing market volatility. The bank revised its overseas funding plan after borrowing costs rose amid interest rate uncertainty and deteriorating internal financial soundness.
According to KB Bank on Nov. 6, the company has delayed its dollar-denominated senior global bond issuance scheduled for the second half of this year and is seeking alternative funding options. Chang Hyuk-im, finance director at KB Bank, said in an interview with Indonesian media outlet Kontan on Nov. 4, "We are continuously evaluating our funding strategy, including the dollar bond issuance plan, in response to global and domestic financial market dynamics."
KB Bank previously issued $300 million in three-year senior unsecured global bonds in October 2024. As the bonds mature in October 2027, the bank had been preparing an additional issuance for refinancing and preemptive liquidity. To this end, it completed administrative procedures including an external audit of financial statements as of the end of June this year.
However, weak earnings weighed on its fundraising. KB Bank posted a net loss of 184.1 billion rupiah (about 16.2 billion won) in the first three quarters of this year, swinging from a net profit of 288.1 billion rupiah a year earlier. In particular, its substandard-or-below loans (NPLs) ratio reached 10.26% as of the end of September, significantly worsening asset soundness.
With the global dollar bond issuance delayed, KB Bank tapped the Indonesian domestic market for alternative funding. In October, the bank issued subordinated bonds in the Indonesian market with coupon rates of 8.95% and 9.30% per annum to secure necessary funds.
Chang said, "The decision to postpone the bond issuance was made after comprehensively considering market conditions including interest rate trends and funding costs," adding, "Our long-term funding strategy remains unchanged, and we have full support from our parent company KB Kookmin Bank and KB Financial Group."
※ This article is an AI translation of the Korean original published by Korea Credit News; it was checked by automated quality guards and published by the English edition desk.
