KB Financial cans incumbent chairman to tap deputy as new leader

KB Financial Group selected Vice Chairman Lee Jae-keun as its next chairman for a three-year term, surprising a market that had widely expected incumbent Chairman Yang Jong-hee to secure another term.

Lee was selected over Yang and former Woori Bank CEO Kwon Kwang-seok. His appointment is due to be finalized at a shareholders meeting on Nov. 20, when Yang's current term expires.

"The group selected Lee to lead a bold transformation and generational shift as it seeks to strengthen its core competitiveness and secure new growth engines beyond its current strong performance," the group's chairman recommendation committee said in a statement.

At Friday's meeting, the committee conducted two-hour in-depth interviews with each of the three shortlisted candidates. They were assessed on five criteria: professional experience and expertise, leadership, morality, alignment with the group's vision and values, and commitment to sound management over the short and long term. The committee then held a final vote.

The leadership change comes as financial authorities pursue governance reforms aimed at curbing prolonged tenures among financial holding company chairmen and improving transparency in succession procedures. Although the measures have yet to be announced, the regulatory push had emerged as a key factor in the selection process.

In announcing Lee's selection, the committee stressed that the succession process began more than a month earlier than in previous years to allow more time to inspect candidates and minimize potential disadvantages for outside contenders. It also pointed to greater disclosure throughout the process, saying the changes were in line with regulators' push to improve the fairness and transparency of management succession.

The decision stands out after Hana Financial Group Chairman Ham Young-joo was reappointed last March, followed by the reappointments of Shinhan Financial Group Chairman Jin Ok-dong and Woori Financial Group Chairman Yim Jong-yong this March.

Yang had also been widely expected to secure reappointment, with strong earnings growth and a reduced reliance on banking seen as key strengths supporting his bid for another term.

KB Financial became the first Korean financial holding company to report more than 5 trillion won ($3.7 billion) in annual net income in 2024, a year after Yang took office. It is now on track to surpass 6 trillion won in net income this year for the first time.