KOSPIFinance030610

Kyobo Securities

₩9,940▼ 0.30%2026-10-02 close

Market Cap

₩1.1T

Turnover

₩100M

Volume

10,000 shares

Shares out.

110M

PER

5.8×

PBR

0.5×

EPS

₩1,730

Dividend Yield

5.45%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩550 per share · Prices as of the 2026-10-02 close

Report overview

After the Brokerage Boom, Capital Remains the Task

A trading boom pushed first-half 2026 profit above the entire 2025 result, yet the sharp drop in market turnover since mid-year and the gap to the 3 trillion won equity threshold for full-scale investment bank status are surfacing at the same time.

1
Combined operating profit for the first two quarters of 2026 was 211.9 billion won and owner-attributable net profit 158.5 billion won, already exceeding the full-year 2025 figures of 190.4 billion won and 142.9 billion won.
2
The improvement was led by brokerage and proprietary trading, while the listed and OTC derivatives segment widened its loss, leaving a wide gap between divisions.
3
Quarterly operating profit shrank to 12.1 billion won in the fourth quarter of 2025, illustrating how volatile the earnings structure can be.
4
The company targets designation as a full-scale investment bank in 2029, but a gap to the 3 trillion won equity requirement remains while parent Kyobo Life Insurance is deploying capital toward holding-company conversion and acquisitions.
5
In August 2026 the Supreme Court finally dismissed the suit seeking to void the 2023 share issuance, removing a long-standing legal overhang.

Business structure

Kyobo Securities, founded in 1949 as Korea's first securities firm, is a mid-sized house running brokerage, wealth management (WM), sales and trading (S&T) and investment banking (IB) side by side.

Its largest shareholder is Kyobo Life Insurance with an 84.72% stake, and its position as the group's only listed financial affiliate shapes both funding and strategy. The firm operates under a co-CEO structure, and CEO Park Bong-kwon was reappointed in March 2026 for a fourth term.

On the revenue mix, first-half 2026 brokerage operating profit rose 334.4% to 108.0 billion won from 24.9 billion won a year earlier, while proprietary trading operating profit gained 65.8% to 242.4 billion won from 146.2 billion won.

By contrast, investment banking operating profit fell 10.8% to 34.0 billion won, and the listed and OTC derivatives business posted an operating loss of 107.2 billion won, wider than the 56.7 billion won loss a year earlier.

Management said wealth management profitability improved on brisk market activity, sales and trading drove gains through asset operations responding to rate volatility, and investment banking sourced and led quality deals.

In terms of scale, the company had led the mid-tier group by equity, but it ceded 11th place in equity rankings to Woori Investment & Securities after that firm's large rights issue. New businesses include security token offerings, venture investment and high-net-worth wealth management.

Competitively, it overlaps heavily with roughly 2 trillion won equity peers such as Hanwha Investment & Securities, Yuanta Securities Korea and Shinyoung Securities, plus a parent-backed Woori Investment & Securities.

Earnings trend

Quarterly revenue · Operating profit

₩1.3T₩70.5B25Q2₩830.4B₩40.6B25Q3₩1.3T₩12.1B25Q4₩2.4T₩95.9B26Q1₩2.7T₩116B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩4.1T₩51.7B2022₩3.7T₩70.3B2023₩3.2T₩113.9B2024₩4.5T₩190.4B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩1.3T	₩70.5B	5.6%
2025Q3	₩830.4B	₩40.6B	4.9%
2025Q4	₩1.3T	₩12.1B	0.9%
2026Q1	₩2.4T	₩95.9B	4.0%
2026Q2	₩2.7T	₩116B	4.3%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩4.1T	₩51.7B	₩43.3B	1.3%	2.8%	759.1%
2023	₩3.7T	₩70.3B	₩67.6B	1.9%	3.6%	730.6%
2024	₩3.2T	₩113.9B	₩117.7B	3.6%	5.9%	700.6%
2025	₩4.5T	₩190.4B	₩142.9B	4.2%	6.7%	809.5%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

Earnings analysis

The confirmed figures show four straight years of profit growth. Operating profit rose from 51.7 billion won in 2022 to 70.3 billion won in 2023, 113.9 billion won in 2024 and 190.4 billion won in 2025, while owner-attributable net profit expanded from 43.3 billion won to 142.9 billion won over the same span.

The operating margin improved from 1.3% in 2022 to 1.9%, 3.6% and 4.2% in the following years; given that securities firms' operating revenue swings with valuation and disposal of trading assets, the direction matters more than the absolute level.

The pace stepped up in 2026: first-quarter operating revenue was 2,395.7 billion won with operating profit of 95.9 billion won and net profit of 68.4 billion won, and second-quarter operating revenue was 2,714.7 billion won with operating profit of 116.0 billion won and net profit of 90.1 billion won, so the first-half totals of 211.9 billion won and 158.5 billion won already exceed all of 2025.

The quarterly path also shows how sharply results can fall and rebound: from 40.6 billion won operating profit and 30.8 billion won net profit in the third quarter of 2025, profit shrank to 12.1 billion won and 6.0 billion won in the fourth quarter, then expanded for two consecutive quarters from the first quarter of 2026.

On earnings quality, fee income rose 78.7% year on year to 245.4 billion won and net fee income gained 81.8% to 202.7 billion won, with brokerage commission income surging 148.4% to 161.1 billion won as the main driver.

Total equity grew from 1,561.8 billion won in 2022 to 2,118.9 billion won in 2025, while the debt ratio rose to 809.5% in 2025 from 700.6% in 2024, a level that reflects the sector's accounting where customer deposits and borrowings sit on the balance sheet.

Operating cash flow flipped signs repeatedly, at minus 1,489.4 billion won in 2023, plus 710.8 billion won in 2024 and minus 897.0 billion won in 2025, tracking changes in trading assets, and the consolidated net capital ratio stood at 974.2% at the end of the first half, up 57.9 percentage points year on year, with a leverage ratio of 788.2%.

Industry analysis

The first half of 2026 was an exceptionally active period for Korean brokers.

Domestic equities rallied on abundant liquidity and semiconductor-led earnings momentum, and as the KOSPI set successive records, average daily turnover including ETFs climbed to 84.4 trillion won in April and 143.5 trillion won in May, according to a Shinhan Investment report in May 2026.

The trend reversed in the second half. Korea Exchange data showed August 2026 average daily turnover on the main board at 25.77 trillion won, down 48.8% from June and 30.2% from July, the lowest of the year. Customer deposits also fell 30.8% from June 4 to 96.71 trillion won as of August 27.

As a result, the third-quarter operating profit consensus for KOSPI-listed brokers compiled by FnGuide stands at 2.19 trillion won, 45.6% below the 4.03 trillion won of the prior quarter.

Analyst Park Hye-jin at Daishin Securities said in a June 2026 report that turnover would likely decline gradually from the third quarter, making the second quarter the probable peak for earnings.

Industry attention is shifting to non-brokerage areas such as investment banking, wealth management and overseas equities as the swing factor for second-half results.

Within that setup, Kyobo Securities carries relatively high sensitivity to turnover because much of its first-half profit growth came from brokerage and trading, while it also faces a structural shift in which profitability gaps widen according to equity size and capital efficiency, a dual challenge for a mid-tier firm.

Outlook

The medium-term goal is explicit. In its first-quarter 2026 business report, Kyobo Securities said it aims to reach 3 trillion won in equity and gain designation as a full-scale investment bank by 2029.

Standalone equity was about 2,162.1 billion won in the first quarter of 2026, leaving roughly 850 billion won of additional capital needed to meet the requirement. Designation would widen the business scope, including raising the corporate credit-extension limit from 100% to 200% of equity.

Competition has taken shape: Woori Investment & Securities, targeting the same 2029 timeline, lifted its equity to 2,228.0 billion won as of end-June after a 1 trillion won rights issue in May 2026.

On funding, the company said it is reshaping its business model toward 2029 designation, securing new growth engines through artificial intelligence, digital transformation and expansion of digital-asset businesses, and reviewing various options including issuance and funding in light of market conditions and financial strategy.

Specific new-business steps are visible as well: after the KDX consortium in which Kyobo Life Insurance participated won approval for an over-the-counter security token exchange, Kyobo Securities plans to issue token products ahead of the venue's opening and is concentrating on supplying risk capital via venture funds.

The organization was realigned accordingly, as the investment banking arm was split into structured finance, investment finance and project finance divisions, the digital-asset business unit was upgraded, and a premium branch for high-net-worth clients was added under wealth management.

At group level, Kyobo Life completed its acquisition of SBI Savings Bank in April 2026 and took full ownership of Kyobo AXA Investment Managers in August as part of its holding-company conversion, making the securities arm's role and the group's capital allocation sequence key items to watch.

Valuation

PER

5.8×

PBR

0.5×

ROE

8.9%

EPS

₩1,730

BPS

₩20,144

Dividend per share

₩550

The shares trade meaningfully below the company's reported net asset value per share, with the price-to-book multiple under one time on both the in-house calculation and the Korea Exchange's published basis.

The earnings-based multiple, reflecting the surge in profit over the past four quarters, sits toward the lower end versus the average for listed Korean brokers.

Because the denominator of that multiple depends heavily on market turnover and trading gains, however, the multiple itself can move quickly in an environment where the third-quarter sector operating profit consensus is set 45.6% below the prior quarter.

On distributions, the company has withheld dividends from its largest shareholder since 2023 while paying cash dividends only to minority holders, lifting the payout ratio from 29.4% in 2022 to 41.8% in 2023 and 48% in 2024, and FnGuide data cited in December 2025 placed it among the highest dividend-yield names in Korean financials.

Against that sits a competing claim on the same resources: meeting the full-scale investment bank threshold requires a large increase in equity, and a rights issue has been discussed as the most realistic route, so shareholder returns and capital accumulation draw on the same pool.

For the sector as a whole, Shinhan Investment said in a May 2026 report that expectations for price-to-book multiples to break above one time were rising on structurally improving earnings power and capital efficiency.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-04

Bull factors

First-half profit already exceeded the full prior year

First-half 2026 operating profit of 211.9 billion won and owner-attributable net profit of 158.5 billion won both exceed the full-year 2025 figures of 190.4 billion won and 142.9 billion won. The four-year profit expansion that began from 51.7 billion won of operating profit in 2022 steepened in 2026.

Brokerage commission income surging 148.4% led the improvement, showing how the retail base acts as leverage in an active market. The same structure works in reverse when trading contracts.

Legal overhang cleared and solvency metrics

On August 12, 2026 the company disclosed that the Supreme Court had finally dismissed the suit seeking to void the share issuance tied to its 2023 capital raise. With nearly three years of litigation risk resolved, constraints around capital-raising decisions have eased.

On solvency, the consolidated net capital ratio reached 974.2% at end-June, up 57.9 percentage points year on year. That is an improvement in a regulatory ratio, not a solution to the absolute size of equity.

Minority-focused payout policy and group standing

Citing enhancement of minority shareholder value, the company has paid no dividend to its largest shareholder since 2023. It has also stated a policy of maintaining a payout ratio of at least 20% on a standalone basis for shareholders other than the largest holder.

At group level, first-half net profit at the securities arm reached roughly one third of parent Kyobo Life's 478.6 billion won standalone first-half net profit, raising the capital-markets unit's weight as holding-company conversion advances. Dividends nonetheless remain discretionary and can conflict with the need to build capital.

Bear factors

Collapsing turnover changes the second-half base

August 2026 average daily turnover on the main board fell 48.8% from June to 25.77 trillion won, the year's low. Average daily volume also shrank from about 1.1 billion shares in March to roughly 300 million in August, a quarter of the level in five months.

Because first-half brokerage profit had more than quadrupled year on year, the comparison base is demanding. The size of the impact will not be confirmed until third-quarter results are disclosed.

Derivatives losses and quarterly volatility

The listed and OTC derivatives business posted a 107.2 billion won operating loss in the first half, wider than the 56.7 billion won loss a year earlier. That means strength in brokerage and proprietary trading is partly offset by segment losses.

Quarterly swings are wide: operating profit fell to 12.1 billion won and net profit to 6.0 billion won in the fourth quarter of 2025. Tracing the drivers requires reading the quarterly disclosures, where the company explains segment profit and loss movements.

Equity gap and the parent's capital capacity

Roughly 850 billion won of additional equity is needed to reach the 3 trillion won threshold. Yet no funding plan such as a rights issue from Kyobo Life is reported to be in place, leaving the firm to accumulate capital through its own business expansion for now.

Kyobo Life is pursuing holding-company conversion and, after acquiring SBI Savings Bank, has joined bids for other insurers, which affects the order of capital allocation. Should a rights issue be chosen, debate over dilution of existing holders could resurface.

Risk factors

Market cycle and credit risk

An earnings mix dependent on brokerage and trading gains can deteriorate quickly when indices and turnover fall.

The delinquency rate on individual overdraft accounts at the five major banks rose to 0.22% at end-June from 0.18% at end-2025, and observers linked heavier repayment burdens for leveraged retail investors to the KOSPI's sharp drop. Losses on margin lending or collateral shortfalls flow directly into brokers' earnings. The relevant metrics can be tracked monthly through regulator and exchange statistics.

Real estate finance and contingent liabilities

Exposure to real estate project finance, a common burden for mid-tier brokers, has been flagged here as well. Alongside recovering earnings, project-finance contingent liabilities and asset quality have been cited as outstanding tasks.

The company split its structured, investment and project finance units in its reorganization, but the quality of exposure must be checked in quarterly filings. Provisioning pressure could re-emerge depending on property conditions and the rate path.

Governance and capital policy

The largest shareholder side holds about 84.75%, leaving a small free float and making capital policy heavily dependent on the controlling holder's intent. During past third-party share placements, dilution of existing shareholders was already contested.

Because the chosen route for future capital raising, whether a rights issue or hybrid securities, changes the impact on different shareholders, board resolutions and disclosures should be read directly.

In addition, the appointment of an independent director with an insurance background has prompted discussion of links to the parent's holding-company conversion, making board composition another item to monitor.

What to watch next

Monthly, September to December 2026
Track Korea Exchange data on average daily turnover for the main board and KOSDAQ plus customer deposits. August main-board turnover of 25.77 trillion won per day and customer deposits of 96.71 trillion won as of August 27 serve as the reference points.
Mid-November 2026
The third-quarter 2026 report will be filed. Key items are the extent to which shrinking turnover feeds into brokerage commissions and trading gains, and whether the derivatives segment loss narrows.
During the fourth quarter of 2026
Watch for any capital-raising disclosure. Management said it is reviewing various options including issuance and funding, so the specific instrument and size, whether a rights issue or hybrid securities, and its effect on existing shareholders are the points to check.
Early February 2027
Full-year 2026 results and the board resolution on cash dividends. Points to observe are whether the policy of no dividend for the largest shareholder and payouts only to minority holders is maintained, and how the payout ratio is set against higher profits.
Second half of 2026 through 2027
Progress in the security token business. The opening schedule of the over-the-counter exchange run by the KDX consortium in which the parent participates, and whether Kyobo Securities actually issues token products, will provide the first read on new-business contribution.

Overall view

On confirmed figures alone, the first half of 2026 was a clear profit expansion for Kyobo Securities.

Operating profit of 211.9 billion won and owner-attributable net profit of 158.5 billion won surpassed the full-year 2025 totals of 190.4 billion won and 142.9 billion won in just six months, extending a margin trend that improved from 1.3% in 2022 to 4.2% in 2025.

The source of that improvement, however, was concentrated in brokerage operating profit of 108.0 billion won, up 334.4% year on year, and proprietary trading profit of 242.4 billion won, up 65.8%, leaving results highly dependent on market conditions, while the 107.2 billion won operating loss in listed and OTC derivatives and the 12.1 billion won operating profit of the fourth quarter of 2025 are reminders of wide quarterly swings.

The second-half backdrop differs from the first: August main-board turnover fell to the year's low and the third-quarter operating profit consensus for the brokerage sector is set 45.6% below the prior quarter. The structural issue is capital.

The company targets full-scale investment bank designation in 2029 but still needs about 850 billion won to meet the 3 trillion won equity requirement, and Woori Investment & Securities narrowed the gap by lifting its equity to 2,228.0 billion won through a 1 trillion won rights issue.

Ultimately, how much of the first-half earnings power persists from the third quarter onward, and what form the capital increase takes, are the two axes for assessing this company, and both can only be verified through future disclosures.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.