IBK Annual Report 2024

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Enhancing Value,
Accelerating Progress

Delivering ‘Value Finance’: Growing Value for Shareholders, Customers, Society, and the Bank

As Korea’s only listed policy bank, IBK is dedicated to fundamentally enhance its corporate value through a balanced commitment to market performance and public responsibility. To accomplish this mission, IBK has set strategic priorities around increasing profitability, enhancing shareholder returns, and expanding market communication. Specifically, IBK aims to diversify revenue streams, innovate cost management, strengthen shareholder returns policies through increased cash dividends and the implementation of quarterly dividends, and enhance senior management’s market interactions.

Corporate Value-up Plan
In an effort to improve the predictability and transparency of IBK’s strategic direction towards shareholder return policy, IBK announced its very first Corporate Value-up Plan, aiming for a CET1 ratio of 12.5% and a gradual increase in the dividend payout ratio to a maximum of 40%.
As a first step in executing this plan, IBK achieved a CET1 ratio of 11.32% and the dividend payout ratio of 35% in 2024(Range 2).
Continued profit improvement will support stronger BIS ratios, establishing “IBK Profit Virtuous Cycle” where accumulated capital is reinvested into SME financing and enhanced shareholder returns.

Distinctive Features of IBK’s Corporate Value-up Plan

IBK’s Corporate Value-up Plan is centered around the “IBK Profit Virtuous Cycle” structure. This involves increasing profit through balanced growth in both interest and non-interest sectors, and utilizing the secured capital capacity to further expand financing for SMEs and shareholder returns.

Enhancing Profitability

To fundamentally enhance corporate value, IBK has maintained a leading position in SME finance while expanding its customer base, increasing non-interest income, and diversifying its income source. Additionally, IBK has reduced costs through optimized loan processes and lower funding costs, while actively exploring future growth engines by expanding the Global Financial Belt and leading in Digital Finance.

Increasing Shareholder Returns

In terms of shareholder return policy, IBK plans to maintain the highest level of dividend payout ratio in Korea through stable capital accumulation. Additionally, the bank plans to introduce a quarterly dividend policy to improve cash flow, reduce ex-dividend impact on share prices, and enhance overall dividend visibility for investors.

Enhancement of Transparent Communication

IBK aims to increase market communication with senior management and enhance transparent communication with investors through the diversification of IR communication channels. The Bank plans to expand leadership presence in key investor forums, host regular meetings with analysts, enhance the accessibility of individual investors, and make more IR information public by increasing the scope of disclosure.

IBK’s Corporate Value-up Plan leverages its strengths as a bank specializing in SME Finance to increase profitability while focusing on enhancing shareholder value. Based on the plan, IBK will achieve sustainable growth and value creation.

Mid- to Long-term Targets

IBK plans to achieve continuous corporate value growth in the mid- to long-term by enhancing capital efficiency and diversifying its income source. To this end, the bank aims to improve its Return on Equity (ROE) and expand the dividend payout ratio up to 40% while seeking a gradual increase of Common Equity Tier 1 (CET1) ratio up to 12.5%, based on stable profit growth.

Additionally, by expanding the Global Financial Belt and leading in Digital Finance, the bank has identified future growth drivers and secured capital stability to establish a balanced shareholder return policy. Through these strategies, IBK will achieve continuous growth and enhance shareholder value, further strengthening its competitiveness in the financial market.