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Rating Action: Moody's assigns A2 senior unsecured rating to KB Kookmin Card's proposed USD debt; outlook stableGlobal Credit Research - 28 Apr 2021Hong Kong, April 28, 2021 -- Moody's Investors Service has assigned an A2 foreign currency senior unsecured debt rating to the proposed USD bonds to be issued by KB Kookmin Card Co., Ltd. (A2 stable). The outlook on KB Kookmin Card is stable.KB Kookmin Card will use the net proceeds from the bond issuance to repay the company's outstanding debt and to finance eligible Social Financing in accordance with the KB Kookmin Card's Green, Social And Sustainability Financing Framework.The assigned rating is based on draft documents reviewed by Moody's, which Moody's does not expect to be materially different from those in the final documentation.RATINGS RATIONALEThe A2 foreign currency senior unsecured rating is in line with KB Kookmin Card's A2 long-term issuer rating. The bond will rank pari passu with all other present and future unsecured and unsubordinated obligations of the company.KB Kookmin Card's A2 long-term issuer rating incorporates a (1) a three-notch uplift based on Moody's assessment of a very high likelihood of support from Kookmin Bank (Bank Deposit: Aa3, Senior Unsecured: Aa3, Baseline Credit Assessment (BCA): a3, stable) via its parent KB Financial Group Inc. (KB FG, A1 stable), in times of need; (2) a one-notch uplift based on a high likelihood of support from the Korean government (Aa2 stable), in times of need; and (3) its standalone assessment of baa3 that reflects the company's stable profitability, solid capitalization, good asset quality, and heavy reliance on market-sensitive wholesale funding.FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGFACTORS THAT COULD LEAD TO AN UPGRADEMoody's could upgrade KB Kookmin Card's ratings if Kookmin Bank's rating is upgraded or KB Kookmin Card's standalone assessment is raised.Moody's would consider raising KB Kookmin Card's standalone assessment if the company (1) significantly improves the coverage ratio for its 12-month debt maturities; (2) generates stable profitability by cutting costs and securing other sources of income; (3) maintains strong capitalization, with its tangible common equity/tangible managed assets above 21%; or (4) improves its asset quality, with net charge-offs/average gross loans below 1.5% on a sustained basis.FACTORS THAT COULD LEAD TO A DOWNGRADEMoody's could downgrade KB Kookmin Card's ratings if the company's strategic importance to KB FG declines or Kookmin Bank's BCA is lowered.Moody's would consider lowering KB Kookmin Card's standalone assessment if (1) its problem loans/gross loans increases to 3% and net charge-offs/average gross loans increases to 4% on a sustained basis; (2) profitability declines, with its return on average assets below 1% on a sustained basis; (3) capitalization deteriorates, with its tangible common equity/tangible managed assets below 14%; or (4) secured debt/gross tangible assets increases above 20%.PRINCIPAL METHODOLOGYThe principal methodology used in this rating was Finance Companies Methodology published in November 2019 and available at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1187099. Alternatively, please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.KB Kookmin Card Co., Ltd. is a wholly-owned subsidiary of KB Financial Group Inc. and is headquartered in Seoul. Its consolidated assets totaled KRW24.1 trillion ($22.2 billion) as of the end of December 2020.REGULATORY DISCLOSURESFor further specification of Moody's key rating assumptions and sensitivity analysis, see the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure form. 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