Market Overview

JB Financial Group Reports a Record High in the First Half of 2018 Net Income

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JB
Financial Group
(KRX:175330) reported the first half 2018
consolidated net income of KRW186.4 billion, up by 17.9% compared to the
first half 2017. In terms of net income in controlling interests, the
Group reported KRW138.4 billion for the first half 2018, up by 24.4%
year over year, continuing its double-digit growth.

Backed by stable funding structure and efficient asset mix, each of the
affiliates' competitiveness has kept strengthening. In particular,
Jeonbuk Bank's separate net income in the first half 2018 recorded
KRW56.2 billion, improving by 49.4% year over year.

Kwangju Bank also continued its strong performance during the same
period, resulting in KRW90.7 billion net income, up by 7.9% year over
year. JB Woori Capital, with its strong sales force and risk management
skills, recorded the first half net income of KRW45.3 billion, up by
17.7% year over year. The Group's Cambodian bank, Phnom Penh Commercial
Bank, has successfully localized, generating KRW7.8 billion net income,
up by 54.3% year over year.

The Group's first half 2018 net income was historically the largest,
mainly attributed by its RoRWA (Return on Risk Weighted Assets)-focused
asset portfolio restructuring which led to stronger profitability and
healthier asset quality. As a result, the Group's annualized first half
2018 ROE and ROA reached 11.2% and 0.8%, respectively. The asset quality
also showed sound improvement as the Group's NPL ratio and delinquency
rate recorded 0.97% and 0.89%, respectively, while the banking
affiliates' cumulative credit costs ratio hit healthy 0.33%.

Meanwhile, the highlight of the second quarter results was an
improvement in capital adequacy ratio. Especially, the Group's
preliminary Common Equity Tier 1 ratio (CET1 ratio) reached 8.90%, up by
0.35%p linked quarter and 0.60%p year over year. The improvement was
driven by the strong internal capital generation and risk weighted
assets management. The trend also showed the Group's commitment to
deliver their 2018 capital ratio target announced at the beginning of
2018. The Group expects to successfully achieve its CET1 ratio target at
the end of 2018, paving the way for the stable growth stage, supported
by the strong capital base.

The First Half 2018 business result materials are available on
English page of
www.jbfg.com,
under Investor Relations, Business Result.

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