Edgar Filing: KOOKMIN BANK

Form 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

For the month of August 2008

Kookmin Bank

(Translation of registrant’s name into English)

9-1, 2-Ga, Namdaemun-Ro, Jung-Gu, Seoul, Korea 100-703

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F X Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submission to furnish a report or other document that the registration foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes No X

Index

1. Summary of 2008 First Half Business Report

2. Exhibit 99.1-Kookmin Bank Review Report for the First Half of 2008

TABLE OF CONTENTS


1.	Introduction to the Bank	5

1.1.	Business Purposes	5
1.2.	History	5
1.3.	Capital Structure	8
1.4.	Dividend	9

2.	Business	10

2.1.	Source and Use of Funds	10
2.2.	Principal Banking Activities	13
2.3.	Branch Networks	17
2.4.	Other Information for Investment Decision	18

3.	Financial Information	20

3.1.	Non-Consolidated Condensed Financial Statements	20
3.2.	Consolidated Condensed Financial Statements	21
3.3.	Other Financial Information	21

4.	Independent Public Accountants	22

4.1.	Audit & Audit related Fees	22
4.2.	Non-Audit Services	22

5.	Corporate Governance and Affiliated Companies	23

5.1.	Board of Directors & Committees under the Board	23
5.2.	Audit Committee	23
5.3.	Compensation to Directors	24
5.4.	Affiliated Companies	30

6.	Directors, Senior Management and Employees	31

6.1.	Executive Directors	31
6.2.	Non-Executive Directors	31
6.3.	Senior Management	32
6.4.	Employees	33

7.	Major Stockholders and Related Party Transactions	34

7.1.	Major Stockholders	34
7.2.	Changes in the Largest Shareholder for the Recent Three Years	34
7.3.	Investments in Affiliates	34
7.4.	Related Party Transactions	35

8.	Other Important Information for Investors	36

8.1.	Progress Relating to Regulatory Filing	36

Summary of 2008 First Half Business Report

On August 14, 2008, Kookmin Bank filed its business report for the first half of 2008 (the “Business Report”) with the Financial Services Commission of Korea and the Korea Exchange. This is a summary of the Business Report translated into English.

Financial information contained in this summary (and in the attached review report) have been prepared in accordance with generally accepted accounting principles in Korea, which differ in certain important respects from generally accepted accounting principles in the United States.

All references to “Kookmin Bank” mean Kookmin Bank on a non-consolidated basis, and all references to “we”, “us” or the “Bank” mean Kookmin Bank and, as the context may require, its subsidiaries. In addition, all references to “Won” or “KRW” in this document are to the currency of the Republic of Korea.

1. Introduction to the Bank

1.1. Business Purposes

The business purpose of the Bank is to engage in the following business activities:

The banking business as prescribed by the Banking Act,

The trust business as prescribed by the Trust Business Act,

The credit card business as prescribed by the Specialized Credit Financial Business Act, and

Other businesses permitted by other relevant Korean laws and regulations

1.2. History

November 1, 2001

Incorporated and listed on the New York Stock Exchange

November 9, 2001

Listed on the Korea Stock Exchange

September 23, 2002

Integrated IT platforms of former Kookmin Bank and H&CB

December 4, 2002

Entered into a strategic alliance agreement with ING Bank N.V. Amsterdam

September 30, 2003

Completed the merger with Kookmin Credit Card

December 16, 2003

Completed a strategic investment in Bank Internasional Indonesia (BII) by investing in a 25% stake in Sorak Financial Holdings, a consortium with other investors

December 19, 2003

Fully privatized through the entire disposition of Korean government’s stake in Kookmin Bank

April 29, 2004

Established a subsidiary, KB Life Insurance Co., Ltd., to engage in insurance business

July 22, 2004

Entered into an alliance with China Construction Bank in connection with the foreign currency business

August 31, 2004

ING Bank N.V. Amsterdam entered into a contract with Kookmin Bank for a strategic investment in KB Life Insurance Co., Ltd.

October 29, 2004

Appointed Mr. Chung Won Kang as the President & CEO in an extraordinary general meeting of shareholders

December 31, 2004

The largest shareholder of Kookmin Bank changed from ING Bank N.V. Amsterdam to Euro-Pacific Growth Fund

January 01, 2005

Integrated three labor unions (former Kookmin Bank, former H&CB, former Kookmin Credit Card) into a single Kookmin Bank labor union

March 02, 2005

Opened KB Satellite Broadcasting System, the first combined broadcasting system in Korea

March 21, 2005

The largest shareholder of Kookmin Bank changed from Euro-Pacific Growth Fund to ING Bank N.V. Amsterdam

June 16, 2005

Disposed of 27,423,761 shares of treasury stock by means of a combination of domestic over-the-counter-sales and an international issuance of depository receipts

July 26, 2005

Obtained an approval from the FSS to use the Market Risk Internal Model for the first time among domestic financial institutions

October 10, 2005

The largest shareholder of Kookmin Bank changed from ING Bank N.V. Amsterdam to Euro-Pacific Growth Fund

February 2, 2006

Established the “Basel II system to calculate credit risk weighted asset and new BIS capital adequacy ratio” for the first time among domestic financial institutions

April 3, 2006

Established 100% computerization of bank accounts for the first time among domestic financial institutions

September 8, 2006

Implemented SOD (Segregation of Duties)

December 11, 2006

Ranked Number 1 among banks in the National Customer Satisfaction Index(NCSI) by Korea Productivity Center

April 27, 2007

Commenced principal stage of the Next Generation System development and new IT center construction

October 31, 2007

Reappointed Mr. Chung Won Kang as the President & CEO in an extraordinary general meeting of shareholders

November 14, 2007

Entered into a share purchase agreement to acquire a 95.8% stake in Hannuri Investment & Securities Co., Ltd.

December 11, 2007

Ranked Number 1 among banks for the second consecutive year and Number 1 among credit card businesses in the National Customer Satisfaction Index(NCSI) by Korea Productivity Center

December 31, 2007

Became the first Korean bank to obtain approval from the FSS to use a “Foundation Internal Ratings-based Approach” for credit risks under Basel II.

February 20, 2008

The largest shareholder of Kookmin Bank changed from Euro-Pacific Growth Fund to the Korean National Pension Service.

March 11, 2008

Acquired a 95.8% stake in Hannuri Investment & Securities Co., Ltd., which was renamed KB Investment & Securities Co., Ltd.

March 14, 2008

Entered into agreements to acquire up to 50.1% of the shares of Joint Stock Company Bank CenterCredit, a Kazakhstan Bank.

March 20, 2008

Application for preliminary authorization to establish a financial holding company

April 30, 2008

Resolution of the Board of Directors to approve the stock transfer plan to establish a financial holding company

June 27, 2008

Preliminary approval granted by the Financial Services Commission to establish a financial holding company

1.3. Capital Structure

1.3.1. Common Shares

Kookmin Bank has the authority to issue a total of 1,000,000,000 shares of capital stock according to its Articles of Incorporation. Kookmin Bank’s Articles of Incorporation also provide that Kookmin Bank is authorized to issue shares of preferred stock up to one-half of all of Kookmin Bank’s issued and outstanding shares of common stock. Upon completion of the merger between the former Kookmin Bank and H&CB, Kookmin Bank issued 299,697,462 common shares.

Upon the resolution of a shareholders’ meeting held on March 22, 2002, Kookmin Bank issued an additional 17,979,954 common shares in connection with a stock dividend of 6%.

On November 25, 2002 Goldman Sachs Capital Koryo, L.P. converted all of its convertible bonds into common shares. According to this conversion on November 30, 2002, Kookmin Bank issued 10,581,269 common shares and distributed them to Goldman Sachs Capital Koryo, L.P.

With respect to the merger between Kookmin Bank and Kookmin Credit Card on September 30, 2003, Kookmin Bank issued an additional 8,120,431 common shares on October 1, 2003. Accordingly, as of June 30, 2008, a total of 336,379,116 common shares were issued.

Number of Shares

(Unit: shares) as of June 30, 2008


	Type
	Common Stock	Total
Share Issued (A)	336,379,116	336,379,116
Treasury Stock (B)	—	—
Share Outstanding (A-B)	336,379,116	336,379,116

Capital Increase

(Unit: Won, shares)


Issue Date	Type	Number	Face Value	Issue Price	Remarks
2001.10.31	Common Stock	299,697,462	5,000	—	M&A into a new entity
2002.3.22	Common Stock	17,979,954	5,000	5,000	Stock dividend
2002.11.30	Common Stock	10,581,269	5,000	22,124	CB conversion
2003.10.01	Common Stock	8,120,431	5,000	38,100	M&A with KCC

1.3.2. Treasury Stock

(Unit: shares)


Date	Details	Number of shares
December 31, 2005	Outstanding Treasury Shares	217,935
January 13, 2006	Disposition due to exercise of stock option by grantees	(217,935	)
As of June 30, 2008	Outstanding Treasury Shares	0

1.3.3. Employee Stock Ownership Association

(Unit: shares)


Type	Beginning Balance (January 1, 2008)	Increase	Decrease	Ending Balance (June 30, 2008)	Remarks
Registered common stock	2,729,756	—	188,452	2,541,304	—
Total	2,729,756	—	188,452	2,541,304	—

1.4. Dividend

The following table shows our dividend related information for the last three years. The Board of Directors of Kookmin Bank passed a resolution to pay a dividend for fiscal year of 2007, and shareholders of Kookmin Bank approved of the dividend payout for fiscal year 2007 at the general meeting of shareholders held on March 20, 2008.

(Unit: in millions of Won unless indicated otherwise)


	June 2008	2007		2006
Net (loss) income for the period	—	2,773,843		2,472,111
Diluted (loss) earnings per share (Won)	—	8,246	¹	7,349
Total dividend amount	—	824,129		1,227,784
Dividend payout ratio (%)	—	29.71	²	49.67
Cash dividend per common share (Won)	—	2,450		3,650
Stock dividend per common share (%)	—	—		—
Dividend per preferred share (Won)	—	—		—
Dividend yield ratio (%)	—	3.48	³	4.90

¹	Earnings per share = net income (Won 2,773,843,133,424) / weighted average number of shares (336,379,116 shares).

²	Dividend payout ratio = total dividend amount for common shares (Won 824,128,834,200) / net income (Won 2,773,843,133,424).

³	Dividend yield ratio = dividend per share (Won 2,450) / average closing price for a week based on business day prior to market closing date of December 31, 2007 (Won 70,475).

2. Business

2.1. Source and Use of Funds

2.1.1. Source of Funds

[Bank Account]

(Unit: in millions of Won, %)

June 30, 2008

December 31, 2007

December 31, 2006

Average
balance

Interest
rate (%)

Average
balance

Interest
rate (%)

Average
balance

Interest
rate (%)

Won currency

Deposits

119,163,504

3.93

109,901,995

3.23

111,324,234

2.91

Certificate of deposit

23,096,410

5.91

14,683,182

5.19

8,408,753

4.53

Borrowings

2,524,693

3.93

2,474,036

3.64

2,533,547

3.36

Call money

840,449

4.90

1,553,396

4.79

2,300,768

4.09

Other

40,196,777

5.84

36,902,539

5.52

28,332,243

5.13

Subtotal

185,821,833

4.60

165,515,148

3.93

152,899,545

3.43

Foreign currency

Deposits

1,796,979

2.23

1,723,594

2.80

1,489,895

2.37

Borrowings

6,479,793

3.25

4,415,317

3.81

3,635,918

3.41

Call money

1,261,483

3.29

538,081

5.04

527,600

4.74

Debentures

2,969,339

3.35

2,820,166

5.18

1,530,941

4.49

Other

190,159

—

91,227

—

59,296

—

Subtotal

12,697,753

3.08

9,588,385

4.06

7,243,650

3.50

Other

Total Shareholders Equity

16,516,404

—

16,064,310

—

14,251,498

—

Allowances

961,692

—

924,317

—

1,004,895

—

Other

13,475,107

—

11,036,268

—

11,935,765

—

Subtotal

30,953,203

—

28,024,895

—

27,192,158

—

Total

229,472,789

3.89

203,128,428

3.40

187,335,353

2.94

2.1.2. Use of Funds

[Bank Account]

(Unit: in millions of Won, %)

June 30, 2008

December 31, 2007

December 31, 2006

Average
balance

Interest
rate (%)

Average
balance

Interest
rate (%)

Average
balance

Interest
rate (%)

Won currency

Due from banks

18,716

0.84

27,232

0.99

190,902

3.66

Securities

32,803,694

5.37

29,795,474

4.66

31,437,266

4.25

Loans

154,201,932

6.86

134,549,458

6.60

120,688,857

6.44

Advances for customers

18,617

11.17

28,717

1.51

13,122

2.27

Call loan

1,244,140

5.01

646,821

4.81

823,293

4.25

Private placement corporate bonds

5,879,340

5.69

7,599,124

5.42

5,702,726

5.43

Credit card accounts

10,602,002

20.11

9,232,452

22.20

7,855,415

24.46

Other

862,202

—

355,868

—

328,681

—

Allowance for credit losses ( - )

-2,608,112

—

-2,340,182

—

-2,377,086

—

Subtotal

203,022,531

7.39

179,894,964

7.14

164,663,176

6.96

Foreign currency

Due from banks

215,716

1.28

323,370

3.94

486,764

4.31

Securities

1,314,088

8.08

993,119

4.60

793,181

6.78

Loans

8,620,183

3.59

7,610,703

4.51

6,561,903

4.06

Call loan

359,629

3.28

424,043

4.84

261,483

4.77

Bills bought

1,893,325

4.61

1,421,642

5.95

1,326,578

5.51

Other

1,058

—

1,815

—

1,798

—

Allowance for credit losses ( - )

-111,876

—

-84,723

—

-65,952

—

Subtotal

12,292,123

4.24

10,689,969

4.78

9,365,755

4.61

Other

Cash

1,090,536

—

1,079,189

—

966,002

—

Fixed assets held for business

2,580,827

—

2,540,601

—

2,397,111

—

Other

10,486,772

—

8,923,705

—

9,943,309

—

Subtotal

14,158,135

—

12,543,495

—

13,306,422

—

Total

229,472,789

6.76

203,128,428

6.58

187,335,353

6.35

2.1.3. Fee Transactions

(Unit: in millions of Won)


		June 30, 2008	June 30, 2007	December 31, 2007
Fee Revenue (A)
Won currency	Guarantees	5,321	3,323	7,535
	Commissions received	564,405	529,420	1,202,814
	Credit card	82,179	73,536	153,876
	National Housing Fund Mgt.	53,288	82,561	121,700
Foreign currency	Guarantees	8,741	3,369	8,315
	Others	49,499	38,576	76,842

Subtotal		763,433	730,785	1,571,082

Fee Expense (B)
Won & foreign currency	Commissions paid in Won	118,014	92,059	208,494
	Credit card	181,780	152,471	350,889
	Others	17,613	19,095	33,740

Subtotal		317,407	263,625	593,123

Fee Income (A-B)		446,026	467,160	977,959

2.2. Principal Banking Activities

2.2.1. Deposits

The following table shows the average balances of our deposits for the periods ended and ending balances as of the dates indicated.

(Unit: in millions of Won)

June 30, 2008

December 31, 2007

December 31, 2006

Average
balance

Ending
balance

Average
balance

Ending
balance

Average
balance

Ending
balance

Deposits in Won

Demand deposits

18,261,780

19,938,779

18,027,342

19,759,190

16,896,730

20,179,568

Time & savings deposits

100,188,694

103,586,082

89,417,348

93,809,636

89,613,715

91,156,790

Mutual installment deposits

2,662,626

2,343,333

3,474,443

3,038,971

4,302,015

3,833,573

Mutual installment for housing

2,763,892

2,608,351

3,425,419

2,973,114

4,221,249

3,842,727

Certificate of deposit

23,096,410

26,607,572

14,683,182

17,617,643

8,408,753

9,579,701

Subtotal

146,973,402

155,084,117

129,027,734

137,198,554

123,442,462

128,592,359

Deposits in foreign currency

1,796,979

1,706,831

1,723,594

1,660,137

1,489,895

1,427,557

Trust deposits

Money trust

8,767,436

9,501,201

8,906,983

8,363,610

9,047,669

9,627,037

Property trust

4,264,908

3,649,070

5,556,671

5,365,233

8,491,099

6,631,376

Subtotal

13,032,344

13,150,271

14,463,654

13,728,843

17,538,768

16,258,413

Total

161,802,725

169,941,219

145,214,982

152,587,534

142,471,125

146,278,329

2.2.2. Average Deposit per Domestic Branch

The following table shows the average balances of our deposits per domestic branch as of the dates indicated.

(Unit: in millions of Won)


	June 30, 2008	December 31, 2007	December 31, 2006
Deposits	135,102	124,446	124,123
Deposits in Won	133,721	123,055	122,904

2.2.3. Average Deposit per Employee

The following table shows the average balances of our deposits per employee as of the dates indicated.

(Unit: in millions of Won)


	June 30, 2008	December 31, 2007	December 31, 2006
Deposits	8,747	7,901	7,799
Deposits in Won	8,658	7,812	7,722

2.2.4. Loan Balances

The following table shows the average balances of our loans for the periods ended and ending balances as of the dates indicated.

(Unit: in millions of Won)

June 30, 2008

December 31, 2007

December 31, 2006

Average
balance

Ending
balance

Average
balance

Ending
balance

Average
balance

Ending
balance

Loans in Won

154,190,280

163,546,973

134,539,050

146,260,926

120,680,825

125,574,817

Loans in foreign currency

8,620,183

10,023,618

7,610,703

7,498,780

6,561,902

7,261,811

Advances for customers

18,617

13,423

28,717

28,695

13,122

19,209

Subtotal

162,829,080

173,584,014

142,178,470

153,788,401

127,255,849

132,855,837

Trust account loans

439,581

476,366

408,301

415,786

351,880

403,552

Total

163,268,661

174,060,380

142,586,771

154,204,187

127,607,729

133,259,389

2.2.5. Loan Balances as of June 30, 2008 by Maturity

(Unit: in millions of Won)


	1 year or less	More than 1 year to 3 years	More than 3 years to 5 years	More than 5 years	Total
Loans in Won	72,627,529	36,220,596	6,058,473	48,640,375	163,546,973
Loans in foreign currency	6,093,044	2,243,152	859,923	827,499	10,023,618

2.2.6. Loan Balances by Type

The following table shows the bank account balances of our loans in Won by use as of the dates indicated.

(Unit: in millions of Won)


		June 30, 2008	December 31, 2007	December 31, 2006
Loans to enterprise	Loans for operations	50,948,081	43,508,536	33,054,421
	Loans for facility	15,786,413	12,401,652	6,103,249
Loans to households		50,828,616	47,705,207	46,509,920
Loans to public sector & others	Loans for operations	2,280,603	1,430,050	894,178
	Loans for facility	46,952	24,450	3,687
Loans on property formation savings		612	702	1,013
Loans for housing		43,655,233	41,189,639	39,007,176
Others		463	690	1,173

Total		163,546,973	146,260,926	125,574,817

2.2.7. Loan to Deposit Ratio¹

The following table shows loan to deposit ratio as of indicated dates.

(Unit: in millions of Won, %)


	June 30, 2008	December 31, 2007	December 31, 2006
Loans (A)	154,190,280	134,539,050	120,680,825
Deposits (B)	146,973,402	129,027,734	123,442,462

Loan to deposit ratio (A/B)	104.91	104.27	97.76

2.2.8. Guarantees

(Unit: in millions of Won)


	June 30, 2008	December 31, 2007	December 31, 2006
Determined	7,178,057	5,297,910	2,704,307
Contingent	6,270,605	3,944,524	2,304,434

Total	13,448,662	9,242,434	5,008,741

¹	Average balance of loans in Won / average balance of (deposits in Won + certificates of deposit)

2.2.9. Securities Investment

The following table shows the average balances of our securities for the periods ended and ending balances as of the indicated dates.

(Unit: in millions of Won)

June 30, 2008

December 31, 2007

December 31, 2006

Average
balance

Ending
balance

Average
balance

Ending
balance

Average
balance

Ending
balance

Securities in Won (Bank account)

Monetary stabilization bonds

5,791,346

3,639,548

7,736,323

6,075,608

11,803,683

8,534,765

Government and public bonds

11,596,326

11,849,945

11,225,989

11,216,456

10,035,180

10,117,416

Debentures

18,024,149

18,865,276

16,342,485

16,350,155

11,847,016

14,140,083

Stocks

2,005,088

2,131,124

1,740,024

1,750,283

1,575,806

2,515,385

Others

1,266,125

1,269,309

349,777

370,240

1,878,308

744,896

Subtotal

38,683,034

37,755,202

37,394,598

35,762,742

37,139,993

36,052,545

Securities in Won (Trust account)

Monetary stabilization bonds

906,997

746,861

1,235,530

980,810

1,247,444

1,524,511

Government and public bonds

1,078,859

1,242,738

1,252,644

1,123,819

1,090,228

1,216,613

Debentures

1,228,870

1,124,552

1,707,174

1,374,010

1,937,309

1,815,093

Stocks

483,517

465,593

567,221

490,118

756,900

769,212

Others

2,743,952

2,964,306

2,585,637

2,538,954

3,837,714

2,873,202

Subtotal

6,442,195

6,544,050

7,348,206

6,507,711

8,869,595

8,198,631

Securities in foreign currency (Trust account)

7,182

—

22,154

12,449

110,472

32,661

Securities in foreign currency (Bank account)

Foreign securities

1,022,702

1,164,186

720,035

927,610

559,343

613,078

Off-shore foreign securities

291,386

308,380

273,084

273,188

233,838

216,066

Subtotal

1,314,088

1,472,566

993,119

1,200,798

793,181

829,144

Total

46,446,499

45,771,818

45,758,077

43,483,700

46,913,241

45,112,981

2.2.10. Trust Account

(Unit: in millions of Won)

June 30, 2008

December 31, 2007

December 31, 2006

Average
amount trusted

Trust
fees

Average
amount trusted

Trust
fees

Average
amount trusted

Trust
fees

Return-guaranteed trust

279

8,495

296

12,928

325

11,295

Performance trust

13,032,065

23,557

14,463,358

57,384

17,538,443

67,209

Total

13,032,344

32,052

14,463,654

70,312

17,538,768

78,504

2.2.11. Credit Card

(Unit: in millions of Won, number of individuals and merchants)


		As of or for the years ended of indicated dates
		June 30, 2008	December 31, 2007	December 31, 2006
Number of card holders	Corporate	211,341	173,122	173,190
	Individual	8,915,134	8,518,930	8,883,738
Number of merchants		1,816,060	1,751,826	1,610,446
Sales volume¹		36,711,092	68,516,441	63,929,192
Fee revenue		1,146,431	2,207,975	2,189,014

2.3. Branch Networks

As of June 30, 2008, we had 1,126 branches (including the head office) and 93 sub-branches in Korea; 482 of our branches and sub-branches are located in Seoul.

We also have four overseas branches and three overseas representative offices. The overseas branches are located in Tokyo, Japan; New York, U.S.A.; Auckland, New Zealand; and Guangzhou, People’s Republic of China. The overseas representative offices located are in Almaty, Kazakhstan; Ho Chi Minh City, Vietnam; and Kyiv, Ukraine.

We plan to open a total of 56 new domestic branches and sub-branches during 2008 (including 19 branches and sub-branches opened during the first half of 2008). We also plan to establish an overseas branch in Harbin, People’s Republic of China, during 2008. These plans are subject to change depending on market conditions, regulatory approvals or other factors.

¹	Includes lump-sum and installment purchases, cash advances, and check card and purchasing card transactions.

2.4. Other Information for Investment Decision

2.4.1. BIS Risk-adjusted Capital Ratios

(Unit: in millions of Won, %)


	June 30, 2008¹	December 31, 2007	December 31, 2006
Risk-adjusted capital (A)	18,890,698	19,634,235	18,751,151
Risk-weighted assets (B)	150,883,497	155,598,835	132,373,478

BIS ratio (A/B)	12.52	12.62	14.17

2.4.2. Non-Performing Loans

(Unit: in millions of Won, %)


June 30, 2008		December 31, 2007		Change
Amount	Ratio of NPL to total loans	Amount	Ratio of NPL to total loans	Amount	Ratio of NPL to total loans
1,114,312	0.56%	1,096,470	0.62%	17,842	0.06 percentage point decrease

2.4.3. Loan Loss Allowances²

The following table shows the balance of our loan loss allowances as of the dates indicated.

(Unit: in millions of Won)


		June 30, 2008	December 31, 2007	December 31, 2006
Loan loss allowance	Domestic	2,794,526	2,609,414	2,458,307
	Foreign	9,655	6,583	4,772

	Total	2,804,181	2,615,997	2,463,079

Write-Off		443,374	822,794	1,693,468

¹	The figures for June 30, 2008 are calculated based on Basel II and are preliminary estimates that are subject to change.

The preliminary estimates for June 30, 2008, calculated based on Basel I for comparative purposes, are as follows:

* Risk-adjusted capital: Won 20,308,289 million

* Risk-weighted assets: Won 177,524,346 million

* BIS ratio: 11.44%

²	Includes allowance for other assets.

2.4.4. Changes in Loan Loss Allowances for Recent Three Years¹

(Unit: in millions of Won)


	June 30, 2008		December 31, 2007		December 31, 2006
Beginning balance	2,501,865		2,360,867		2,453,275
Net Write-Off	(219,506	)	(375,598	)	(1,034,059	)
Write-Off	(441,960	)	(817,358	)	(1,680,331	)
Recovery	257,725		530,637		474,278
Other	(35,271	)	(88,877	)	171,994
Provision for loan losses	399,655		516,596		941,651

Ending balance	2,682,014		2,501,865		2,360,867

¹	Includes present value discounts and excludes allowance for other assets.

3. Financial Information

3.1. Non-Consolidated Condensed Financial Statements

(Unit: in millions of Won)


	As of or for the period ended
	June 30, 2008	December 31, 2007
Cash and due from banks	6,602,042	6,544,754
Securities	33,653,467	30,777,359
Loans	191,142,034	171,549,993
Tangible assets	2,242,485	2,298,743
Other assets	11,339,233	7,695,189

Total assets	244,979,261	218,866,038

Deposits	156,791,555	138,858,691
Borrowings	54,535,929	50,250,481
Other liabilities	17,257,590	13,719,105

Total liabilities	228,585,074	202,828,277

Common stock	1,681,896	1,681,896
Capital surplus	6,273,290	6,269,263
Capital adjustments	0	0
Accumulated other comprehensive income	271,746	345,446
Retained earnings	8,167,255	7,741,156

Total shareholders’ equity	16,394,187	16,037,761

Liabilities and Shareholders’ Equity	244,979,261	218,866,038

Operating revenue	15,383,836	21,281,826
Operating income	1,682,252	4,233,386
Income from continuing operations	1,768,978	4,529,870
Income before income tax	1,768,978	4,529,870
Net (loss) income	1,275,853	2,773,843

3.2. Consolidated Condensed Financial Statements

(Unit: in millions of Won, number of subsidiaries)


	As of or for the year ended
	December 31, 2007	December 31, 2006
Cash and due from banks	6,727,411	6,688,977
Securities	34,239,723	32,588,135
Loans	171,730,131	150,017,861
Tangible assets	2,301,464	2,139,486
Other assets	8,045,715	7,478,977

Total assets	223,044,444	198,913,436

Deposits	142,100,520	133,296,975
Borrowings	50,170,776	38,786,899
Other liabilities	14,666,041	11,701,501

Total liabilities	206,937,337	183,785,375

Common stock	1,681,896	1,681,896
Capital surplus	6,274,535	6,274,831
Retained earnings	7,775,285	6,241,912
Capital adjustments	0	0
Accumulated other comprehensive income	331,159	885,141
Minority interests	44,232	44,281

Total shareholders’ equity	16,107,107	15,128,061

Liabilities and Shareholders’ Equity	223,044,444	198,913,436

Operating revenue	22,154,335	20,319,778
Operating income	4,280,654	3,250,034
Income from continuing operations	4,544,746	3,424,562
Income before income tax	4,544,746	3,424,562
Net (loss) income	2,762,198	2,467,006
Controlling company interests, gain (loss)	2,757,316	2,458,260
No. of subsidiaries included in the consolidation	10	11

3.3. Other Financial Information

See Exhibit 99.1 Kookmin Bank Review Report by our independent auditors for our full financial statements and relevant notes, which have been prepared in accordance with generally accepted accounting principles in Korea. The Review Report will also be available on our website, www.kbstar.com.

4. Independent Public Accountants

4.1. Audit & Audit related Fees

Deloitte Anjin LLC has reviewed our financial statements for the first half of 2008. The aggregate contracted amount of such firm’s audit and review fees for the year 2008 is Won 1,490 million.

4.2. Non-Audit Services

The following is a description of non-audit services rendered by our independent auditor for the recent three years.

(Unit: in millions of Won unless indicated otherwise)


Year	Service description		Amount of payment
1H 2008		—	—
2007	-	Issuance of comfort letter	90
	-	Issuance of comfort letter	70
	-	Agreement for issuance of comfort letter¹	50
2006	-	Issuance of comfort letter	40
	-	Confirmation of BIS ratio and confirmation affirming that Kookmin Bank is not a Non-Financial Operator	10

¹	The Agreement for issuance of comfort letter has been terminated.

5. Corporate Governance and Affiliated Companies

5.1. Board of Directors & Committees under the Board

The board of directors, currently consisting of executive directors and non-executive directors, holds regular meetings quarterly. Additional extraordinary meetings may also be convened at the request of any director or any committee that serves under the board of directors.

The board of directors resolves following matters:

Matters relating to general meeting of shareholders

Matters relating to general management

Matters relating to organization and directors of the company

Matters relating to funding and capital

Other related matters

The following committees currently serve under our board of directors:

The Board Steering Committee

The Management Strategy Committee

The Risk Management Committee

The Evaluation & Compensation Committee

The Audit Committee

The Non-Executive Director Nominating Committee

For the list of our directors, see 6. Directors, Senior Management and Employees, 6.1. Executive Directors and 6.2. Non-Executive Directors.

5.2. Audit Committee

The audit committee oversees our financial reporting and approves the appointment of and interaction among our independent auditors, compliance officers, management personnel and other committee advisors. The committee also reviews our financial information, auditor’s examinations, key financial statement issues and the administration of our financial affairs by the board of directors. The committee also examines the agenda for, and financial statements and other reports to be submitted by, the board of directors to each general meeting of shareholders. The committee holds regular meetings every quarter and on an as-needed basis.

5.3. Compensation to Directors

5.3.1. Compensation to Directors

The following table shows information regarding the remuneration paid to the Directors in the first half of 2008.

(Unit: in millions of Won)


	The aggregate remuneration paid (From January to June 2008)	Limit for the remuneration resolved by shareholders’ meeting (For the year 2008)	Average amount of the payment per person (From January to June 2008)		Total fair value of stock option¹	Weight (%)
1) Executive Directors (Except Chief Audit Executive and Non-executive Directors)	2,705		849		—	—
2) Non-executive Directors (Except members of Audit Committee)	170	8,000	34	²	74	—
3) Members of Audit Committee (Including Chief Audit Executive)	781		150	²	112	—

Total	3,656	8,000	1,033		186	—

For those portions of stock options granted on or before December 31, 2006, we used the intrinsic value model to calculate the total fair value of stock option. For those portions of stock options granted on or after January 1, 2007, we adopted the Black-Scholes option pricing model to calculate the total fair value of stock option.

The following negative values, resulting from calculation according to the intrinsic value method and the fair value method, are excluded from this table: (-3,824) million Won (Executive Directors (except Chief Audit Executive and Non-executive Directors)), (-49) million Won (Non-executive Directors (except members of Audit Committee)).

²	Reflects the changes made to the number of non-executive directors in March and May of 2008.

5.3.2. Stock Options

The following table is the breakdown of stock options Kookmin Bank has granted to the directors and employees as of June 30, 2008.

(Unit: in Won, shares)

Grant date

Name of the grantee

Position when granted

Exercise period

Exercise
price

Number of
granted
options¹

Number of
exercised
options

Number of
exercisable
options

From

15-Mar-01

Young Seok Kim

Non Executive Director

16-Mar-04

15-Mar-09

28,027

1,870

15-Mar-01

In Kie Kim

Non Executive Director

16-Mar-04

15-Mar-09

28,027

2,961

15-Mar-01

Ji Hong Kim

Non Executive Director

16-Mar-04

15-Mar-09

28,027

2,961

15-Mar-01

Se Woong Lee

Non Executive Director

16-Mar-04

15-Mar-09

28,027

2,961

15-Mar-01

Jong Min Lee

Chief Audit Executive

16-Mar-04

15-Mar-09

28,027

14,807

2,807

12,000

15-Mar-01

Seung Heon Han

Non Executive Director

16-Mar-04

15-Mar-09

28,027

1,870

15-Mar-01

Duk Hyun Kim

Executive Vice President

16-Mar-04

15-Mar-09

28,027

11,845

4,845

7,000

15-Mar-01

Bock Woan Kim

Executive Vice President

16-Mar-04

15-Mar-09

28,027

11,845

15-Mar-01

Yoo Hwan Kim

Executive Vice President

16-Mar-04

15-Mar-09

28,027

11,845

15-Mar-01

Ok Hyun Yoon

Executive Vice President

16-Mar-04

15-Mar-09

28,027

11,845

7,845

4,000

15-Mar-01

Sang Hoon Lee

Employee

16-Mar-04

15-Mar-09

28,027

2,961

2,461

500

15-Mar-01

Jae In Suh

Employee

16-Mar-04

15-Mar-09

28,027

2,961

15-Mar-01

Jong Hwa Lee

Employee

16-Mar-04

15-Mar-09

28,027

2,961

2,461

500

15-Mar-01

Sang Won Lee

Employee

16-Mar-04

15-Mar-09

28,027

2,961

15-Mar-01

Joon Ho Park

Employee

16-Mar-04

15-Mar-09

28,027

592

15-Mar-01

Jeong Haing Lee

Employee

16-Mar-04

15-Mar-09

28,027

592

15-Mar-01

Tae Joo Yoon

Employee

16-Mar-04

15-Mar-09

28,027

15-Mar-01

Si An Her

Employee

16-Mar-04

15-Mar-09

28,027

370

15-Mar-01

Seok Won Choi

Employee

16-Mar-04

15-Mar-09

28,027

592

15-Mar-01

Yong Soo Shin

Employee

16-Mar-04

15-Mar-09

28,027

370

15-Mar-01

Young Mo Lee

Employee

16-Mar-04

15-Mar-09

28,027

592

15-Mar-01

Sung Gil Lee

Employee

16-Mar-04

15-Mar-09

28,027

370

22-Mar-01

Cheol Ho Kim

Former KCC Officer

23-Mar-04

22-Mar-11

71,538

4,429

22-Mar-01

Jun Chae Song

Former KCC Officer

23-Mar-04

22-Mar-11

71,538

6,644

22-Mar-01

Myoung Woo Lee

Former KCC Officer

23-Mar-04

22-Mar-11

71,538

4,429

22-Mar-01

Han Kyoung Lee

Former KCC Officer

23-Mar-04

22-Mar-11

71,538

6,644

16-Nov-01

Sang Hoon Kim

Chairman

17-Nov-04

16-Nov-09

51,200

150,000

75,000

22-Mar-02

Sun Jin Kim

Non Executive Director

23-Mar-05

22-Mar-10

57,100

3,000

22-Mar-02

Ji Hong Kim

Non Executive Director

23-Mar-05

22-Mar-10

57,100

3,321

22-Mar-02

Keun Shik Oh

Non Executive Director

23-Mar-05

22-Mar-10

57,100

3,321

1,021

2,300

22-Mar-02

Kyung Hee Yoon

Non Executive Director

23-Mar-05

22-Mar-10

57,100

3,000

22-Mar-02

Dong Soo Chung

Non Executive Director

23-Mar-05

22-Mar-10

57,100

10,000

22-Mar-02

Henry Cornell

Non Executive Director

23-Mar-05

22-Mar-10

57,100

3,321

22-Mar-02

Timothy Hartman

Non Executive Director

23-Mar-05

22-Mar-10

57,100

3,321

22-Mar-02

Byung Sang Kim

Executive Vice President

23-Mar-05

22-Mar-10

57,100

9,498

22-Mar-02

Bock Woan Kim

Executive Vice President

23-Mar-05

22-Mar-10

57,100

13,339

22-Mar-02

Ki Sup Shin

Executive Vice President

23-Mar-05

22-Mar-10

57,100

26,405

16,405

10,000

22-Mar-02

Sung Hyun Chung

Executive Vice President

23-Mar-05

22-Mar-10

57,100

19,525

22-Mar-02

Bong Hwan Cho

Executive Vice President

23-Mar-05

22-Mar-10

57,100

9,498

22-Mar-02

Ki Taek Hong

Executive Vice President

23-Mar-05

22-Mar-10

57,100

19,525

22-Mar-02

Jong Young Yoon

Employee

23-Mar-05

22-Mar-10

57,100

14,712

5,000

9,712

22-Mar-02

Jae Il Song

Employee

23-Mar-05

22-Mar-10

57,100

9,762

22-Mar-02

Hyung Goo Sim

Employee

23-Mar-05

22-Mar-10

57,100

14,712

¹	Some numbers of the granted options have been adjusted due to the merger and the early retirement of the grantees.

Grant date

Name of the grantee

Position when granted

Exercise period

Exercise
price

Number of
granted
options¹

Number of
exercised
options

Number of
exercisable
options

From

22-Mar-02

Jeong Haing Lee

Employee

23-Mar-05

22-Mar-10

57,100

9,762

22-Mar-02

Joon Sup Chang

Employee

23-Mar-05

22-Mar-10

57,100

9,762

22-Mar-02

Sung Bin Kim

Employee

23-Mar-05

22-Mar-10

57,100

9,762

22-Mar-02

Sung Bok Park

Employee

23-Mar-05

22-Mar-10

57,100

14,712

22-Mar-02

Yun Keun Jung

Employee

23-Mar-05

22-Mar-10

57,100

15,000

22-Mar-02

Man Soo Song

Employee

23-Mar-05

22-Mar-10

57,100

9,762

22-Mar-02

Hack Yeon Jeong

Employee

23-Mar-05

22-Mar-10

57,100

5,000

22-Mar-02

Jong Hwan Byun

Employee

23-Mar-05

22-Mar-10

57,100

5,000

22-Mar-02

Jae Han Kim

Employee

23-Mar-05

22-Mar-10

57,100

2,500

29-Mar-02

Byoung Hak Kim

Former KCC Officer

30-Mar-04

29-Mar-11

129,100

3,330

29-Mar-02

Jang Ok Kim

Former KCC Officer

30-Mar-04

29-Mar-11

129,100

3,330

29-Mar-02

Sun Lee

Former KCC Officer

30-Mar-04

29-Mar-11

129,100

3,330

26-Jul-02

Donald H. MacKenzie

Executive Vice President

27-Jul-05

26-Jul-10

58,800

23,899

21-Mar-03

Ki Hong Kim

Non Executive Director

22-Mar-06

21-Mar-11

58,600

10,000

21-Mar-03

Sun Jin Kim

Non Executive Director

22-Mar-06

21-Mar-11

43,800

6,678

21-Mar-03

Eun Joo Park

Non Executive Director

22-Mar-06

21-Mar-11

42,200

3,351

21-Mar-03

Kyung Hee Yoon

Non Executive Director

22-Mar-06

21-Mar-11

43,800

6,678

21-Mar-03

Bernard S. Black

Non Executive Director

22-Mar-06

21-Mar-11

43,800

6,678

21-Mar-03

Richard Elliott Lint

Non Executive Director

22-Mar-06

21-Mar-11

43,800

6,678

21-Mar-03

Sung Chul Kim

Executive Vice President

22-Mar-06

21-Mar-11

35,500

9,443

4,443

5,000

21-Mar-03

See Young Lee

Executive Vice President

22-Mar-06

21-Mar-11

35,500

7,024

21-Mar-03

Won Suk Oh

Employee

22-Mar-06

21-Mar-11

35,500

9,730

21-Mar-03

Sung Dae Min

Employee

22-Mar-06

21-Mar-11

35,500

9,730

21-Mar-03

Kyong Jae Jeong

Employee

22-Mar-06

21-Mar-11

35,500

9,730

21-Mar-03

Chul Hee Kim

Employee

22-Mar-06

21-Mar-11

35,500

14,343

21-Mar-03

In Do Lee

Employee

22-Mar-06

21-Mar-11

35,500

9,730

21-Mar-03

Maeng Soo Ryang

Employee

22-Mar-06

21-Mar-11

35,500

9,730

27-Aug-03

Jin Baek Cheong

Executive Vice President

28-Aug-06

27-Aug-11

40,500

5,091

09-Feb-04

Young Il Kim

Senior Executive Vice President

10-Feb-07

09-Feb-12

46,100

7,125

09-Feb-04

Sang Jin Lee

Senior Executive Vice President

10-Feb-07

09-Feb-12

46,100

7,125

09-Feb-04

Yun Keun Jung

Senior Executive Vice President

10-Feb-07

09-Feb-12

46,100

5,000

09-Feb-04

Dong Hwan Cho

Employee

10-Feb-07

09-Feb-12

46,100

5,000

09-Feb-04

Dong Sook Kang

Employee

10-Feb-07

09-Feb-12

46,100

5,000

09-Feb-04

Young Han Kim

Employee

10-Feb-07

09-Feb-12

46,100

5,000

09-Feb-04

De Oak Shin

Employee

10-Feb-07

09-Feb-12

46,100

5,000

09-Feb-04

Chang Ho Kim

Employee

10-Feb-07

09-Feb-12

46,100

5,000

09-Feb-04

Dal Soo Lee

Employee

10-Feb-07

09-Feb-12

46,100

5,000

09-Feb-04

Byong Doo Ahn

Employee

10-Feb-07

09-Feb-12

46,100

5,000

23-Mar-04

Young Soon Cheon

Non Executive Director

24-Mar-07

23-Mar-12

48,500

5,000

23-Mar-04

Dong Soo Chung

Non Executive Director

24-Mar-07

23-Mar-12

48,500

5,000

23-Mar-04

Wang Ha Cho

Non Executive Director

24-Mar-07

23-Mar-12

48,800

5,000

23-Mar-04

Woon Youl Choi

Non Executive Director

24-Mar-07

23-Mar-12

48,800

5,000

01-Nov-04

Chung Won Kang

President & CEO

02-Nov-07

01-Nov-12

50,600

610,000

18-Mar-05

Hyung Duk Chang

Chief Audit Executive

19-Mar-08

18-Mar-13

51,600

30,000

18-Mar-05

Kap Shin

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

30,000

18-Mar-05

Dong Won Kim

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

28,330

Grant date

Name of the grantee

Position when granted

Exercise period

Exercise
price

Number of
granted
options¹

Number of
exercised
options

Number of
exercisable
options

From

18-Mar-05

Yun Keun Jung

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

8,759

18-Mar-05

Nam Sik Yang

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

18,750

18-Mar-05

Hyo Sung Won

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

30,000

18-Mar-05

Yong Kook Oh

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

30,000

18-Mar-05

Sang Jin Lee

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

8,759

18-Mar-05

Ahn Sook Koo

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

8,759

18-Mar-05

Jung Young Kang

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

18,750

18-Mar-05

Young Han Choi

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

30,000

18-Mar-05

Dong Soo Choe

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

18,750

18-Mar-05

Seong Kyu Lee

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

8,759

18-Mar-05

Jun Bo Cho

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

8,759

18-Mar-05

Jeong Min Kim

Senior Executive Vice President

19-Mar-08

18-Mar-13

46,800

28,056

18-Mar-05

Sung Soo Jung

Employee

19-Mar-08

18-Mar-13

46,800

4,379

18-Mar-05

Hye Young Kim

Employee

19-Mar-08

18-Mar-13

46,800

4,379

18-Mar-05

Ki Hyun Kim

Employee

19-Mar-08

18-Mar-13

46,800

4,379

18-Mar-05

Jae Sam Jung

Employee

19-Mar-08

18-Mar-13

46,800

14,986

18-Mar-05

Chang Ho Kim

Employee

19-Mar-08

18-Mar-13

46,800

4,379

18-Mar-05

Dong Sook Kang

Employee

19-Mar-08

18-Mar-13

46,800

4,379

18-Mar-05

De Oak Shin

Employee

19-Mar-08

18-Mar-13

46,800

14,165

18-Mar-05

Dal Soo Lee

Employee

19-Mar-08

18-Mar-13

46,800

15,000

18-Mar-05

Byong Doo Ahn

Employee

19-Mar-08

18-Mar-13

46,800

4,379

18-Mar-05

Byung Kun Oh

Employee

19-Mar-08

18-Mar-13

46,800

15,000

18-Mar-05

Won Sik Yeo

Employee

19-Mar-08

18-Mar-13

46,800

14,165

18-Mar-05

Dong Su Ryo

Employee

19-Mar-08

18-Mar-13

46,800

13,973

18-Mar-05

Kyoung Ho Lee

Employee

19-Mar-08

18-Mar-13

46,800

9,375

18-Mar-05

Jeung Ho Lee

Employee

19-Mar-08

18-Mar-13

46,800

15,000

18-Mar-05

Kwang Suk Lee

Employee

19-Mar-08

18-Mar-13

46,800

9,375

18-Mar-05

Tae Gon Kim

Employee

19-Mar-08

18-Mar-13

46,800

15,000

18-Mar-05

Hyeog Kwan Kwon

Employee

19-Mar-08

18-Mar-13

46,800

13,973

18-Mar-05

Kyu Hyung Jung

Employee

19-Mar-08

18-Mar-13

46,800

14,165

18-Mar-05

Dong Hwan Cho

Employee

19-Mar-08

18-Mar-13

46,800

9,375

18-Mar-05

Man Hee Lee

Employee

19-Mar-08

18-Mar-13

46,800

9,375

18-Mar-05

Il Soo Moon

Employee

19-Mar-08

18-Mar-13

46,800

15,000

18-Mar-05

Yong Seung Lee

Employee

19-Mar-08

18-Mar-13

46,800

9,375

18-Mar-05

Suk Yong Cha

Non Executive Director

19-Mar-08

18-Mar-13

61,000

5,091

18-Mar-05

Ki Hong Kim

Non Executive Director

19-Mar-08

18-Mar-13

60,300

5,077

18-Mar-05

Young Soon Cheon

Non Executive Director

19-Mar-08

18-Mar-13

63,600

10,072

18-Mar-05

Dong Soo Chung

Non Executive Director

19-Mar-08

18-Mar-13

51,600

15,000

18-Mar-05

Chang Kyu Lee

Non Executive Director

19-Mar-08

18-Mar-13

51,600

15,000

Grant date

Name of the grantee

Position when granted

Exercise period

Exercise
price

Number of
granted
options¹

Number of
exercised
options

Number of
exercisable
options

From

18-Mar-05

Hun Namkoong

Non Executive Director

19-Mar-08

18-Mar-13

61,000

5,091

18-Mar-05

Doo Hwan Song

Non Executive Director

19-Mar-08

18-Mar-13

63,800

10,031

18-Mar-05

Dam Cho

Non Executive Director

19-Mar-08

18-Mar-13

51,600

15,000

18-Mar-05

Nobuya Takasugi

Non Executive Director

19-Mar-08

18-Mar-13

51,600

15,000

27-Apr-05

Kyung Wook Kang

Employee

28-Apr-08

27-Apr-13

45,700

8,827

22-Jul-05

Donald H. MacKenzie

Senior Executive Vice President

23-Jul-08

22-Jul-13

49,200

30,000

23-Aug-05

Youn Soo Kim

Employee

24-Aug-08

23-Aug-13

53,000

7,212

24-Mar-06

Dong Soo Chung

Non Executive Director

25-Mar-09

24-Mar-14

77,900

19,917

24-Mar-06

Chang Kyu Lee

Non Executive Director

25-Mar-09

24-Mar-14

77,900

9,958

24-Mar-06

Dam Cho

Non Executive Director

25-Mar-09

24-Mar-14

77,800

10,000

24-Mar-06

Nobuya Takasugi

Non Executive Director

25-Mar-09

24-Mar-14

77,900

9,958

24-Mar-06

Young Soon Cheon

Non Executive Director

25-Mar-09

24-Mar-14

85,100

5,000

24-Mar-06

Kee Young Chung

Non Executive Director

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

Bo Kyung Byun

Non Executive Director

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

Bae Kin Cha

Non Executive Director

25-Mar-09

24-Mar-14

81,900

21,459

24-Mar-06

Hyung Duk Chang

Chief Audit Executive

25-Mar-09

24-Mar-14

77,900

19,917

24-Mar-06

Ki Hong Kim

Chief Executive Vice President

25-Mar-09

24-Mar-14

X²

210,000

24-Mar-06

Kap Joe Song

Senior Executive Vice President

25-Mar-09

24-Mar-14

80,000

27,878

24-Mar-06

Dal Soo Lee

Senior Executive Vice President

25-Mar-09

24-Mar-14

77,800

20,000

24-Mar-06

Won Sik Yeo

Senior Executive Vice President

25-Mar-09

24-Mar-14

80,300

18,166

24-Mar-06

De Oak Shin

Senior Executive Vice President

25-Mar-09

24-Mar-14

80,300

18,166

24-Mar-06

Choong Won Cho

Employee

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

Yook Sang Kwon

Employee

25-Mar-09

24-Mar-14

80,300

18,175

24-Mar-06

Haing Hyun Choi

Employee

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

In Gyu Choi

Employee

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

Kwang Chun Shon

Employee

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

Han Mok Cho

Employee

25-Mar-09

24-Mar-14

80,300

18,175

24-Mar-06

Soon Hyun Kim

Employee

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

Seung Joo Baik

Employee

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

Kwang Mook Park

Employee

25-Mar-09

24-Mar-14

80,300

18,175

24-Mar-06

Sai Yoon Hong

Employee

25-Mar-09

24-Mar-14

X²

30,000

24-Mar-06

Sang Rak Jang

Employee

25-Mar-09

24-Mar-14

80,300

18,175

24-Mar-06

Jin Sun Paeng

Employee

25-Mar-09

24-Mar-14

80,300

18,175

24-Mar-06

Shin Og Joo

Employee

25-Mar-09

24-Mar-14

80,300

18,175

24-Mar-06

Young Hee Jeon

Employee

25-Mar-09

24-Mar-14

X²

30,000

²	Exercise price = (Base Price) Won x (1 + TRS of the three major competitors x 0.4)

(Base Price) Won is the arithmetic mean of the following three numbers: the sum of the daily closing price multiplied by the daily trading volume divided by the daily trading volume for the common shares during each of the following periods: (i) two months prior to, but excluding, the grant date; (ii) one month prior to, but excluding, the grant date; and (iii) one week prior to, but excluding, the grant date.

TRS of the three major competitors shall mean (the sum of each of the three major competitor’s Total Market Cap at the expected exercise price confirmation date less the sum of each of the three major competitor’s Total Market Cap at the grant date) divided by the sum of each of the three major competitor’s Total Market Cap at the grant date.

Grant date

Name of the grantee

Position when granted

Exercise period

Exercise
price

Number of
granted
options¹

Number of
exercised
options

Number of
exercisable
options

From

24-Mar-06

Bae Young Lee

Employee

25-Mar-09

24-Mar-14

80,300

18,175

28-Apr-06

Young Mo Lee

Employee

29-Apr-09

28-Apr-14

X²

30,000

27-Oct-06

Dong Hyun Ji

Employee

28-Oct-09

27-Oct-14

X²

20,000

08-Feb-07

Dong Su Yeo

Senior Executive Vice President

09-Feb-10

08-Feb-15

77,100

9,013

08-Feb-07

Hyeog Kwan Kwon

Senior Executive Vice President

09-Feb-10

08-Feb-15

77,100

9,013

08-Feb-07

Jeung Ho Lee

Senior Executive Vice President

09-Feb-10

08-Feb-15

77,100

10,000

08-Feb-07

Kyung Woo Nam

Senior Executive Vice President

09-Feb-10

08-Feb-15

X²

45,000

08-Feb-07

Gi Eui Choi

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Chung Wook Kim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Kyung Hak Lee

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Jae Gon Kim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Heung Woon Kim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Woo Shick Lee

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Young Hwan Sohn

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Young Gu Joo

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Han Ok Kim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Yong Shin Kim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Kyung Gu Lee

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Kyun Shin

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Hwa Jung Kim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Tae Sung Hwang

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Myung Heun You

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Nam Cheol Shin

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

In Byung Park

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Kun Soo Kang

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Kwang Won Jee

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Youn Dong Kim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Chan Bon Park

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Jong Bum Kim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Byong Duk Min

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Hye Seok Seo

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Bou Hwan Sim

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Yong Soo Seok

Employee

09-Feb-10

08-Feb-15

X²

30,000

08-Feb-07

Sang Hun Choi

Employee

09-Feb-10

08-Feb-15

X²

30,000

23-Mar-07

Jacques P.M. Kemp

Non Executive Director

24-Mar-10

23-Mar-15

X²

30,000

Total

3,814,639

130,274

3,684,365

(The weighted average exercise price of exercisable options is Won 63,523)

5.4. Affiliated Companies

5.4.1. List of Affiliates¹

Affiliated companies of Kookmin Bank and its ownership as of June 30, 2008 are as follows.

KB Investment Co., Ltd. (99.99%)

KB Asset Management Co., Ltd. (80.00%)

KB Real Estate Trust Co., Ltd. (99.99%)

KB Credit Information Co., Ltd. (99.73%)

KB Data Systems Corporation (99.99%)

KB Futures Co., Ltd. (99.98%)

KB Life Insurance Co., Ltd. (51.00%)

Kookmin Bank International (London) Ltd. (100.00%)

Kookmin Bank Hong Kong Ltd. (100.00%)

Sorak Financial Holdings Pte. Ltd. (25.00%)

KB Investment & Securities Co., Ltd. (97.06%)

¹	Excludes Jooeun Industrial and KLB Securities, which are under liquidation procedures. Kookmin Singapore Ltd. and Kookmin Finance Asia Limited are also under liquidation procedures.

6. Directors, Senior Management and Employees

6.1. Executive Directors

Our five executive directors consist of the President & CEO, Chief Audit Executive and Senior Executive Vice Presidents as of June 30, 2008.

The names and positions of our directors, and the number of shares of Kookmin Bank’s common stock they own are set forth below as of June 30, 2008.


Name	Date of Birth	Position	Common Shares Owned
Chung Won Kang	12/19/1950	President & CEO	—
Yong Hwa Cheong	07/12/1952	Chief Audit Executive	—
In Gyu Choi	12/23/1955	Senior EVP	39
Donald H. MacKenzie	12/20/1948	CFO & Senior EVP	—
Ki Hong Kim	01/10/1957	Senior EVP	—

6.2. Non-Executive Directors

Our non-executive directors are selected based on the candidates’ talents and skills in diverse areas, such as law, finance, economy, management and accounting.

Our current non-executive directors and the number of shares of Kookmin Bank’s common stock they own as of June 30, 2008 are as follows.


Name	Date of Birth	Position	Common Shares Owned
Kee Young Chung	09/07/1948	Non-Executive Director	—
Jacques P.M. Kemp	05/15/1949	Non-Executive Director	—
Dam Cho	08/01/1952	Non-Executive Director	—
Suk Sig Lim	07/17/1953	Non-Executive Director	257
Bo Kyung Byun	08/09/1953	Non-Executive Director	860
Sang Moon Hahm	02/02/1954	Non-Executive Director	40
Han Kim	02/17/1954	Non-Executive Director	—
Chee Joong Kim	12/11/1955	Non-Executive Director	—
Chan Soo Kang	11/23/1961	Non-Executive Director	50

6.3. Senior Management

In addition to the executive directors who are also our executive officers, we had the following 11 executive officers as of June 30, 2008.


Name	Date of Birth	Position	Common Shares Owned
Hyung Goo Sim	10/24/1953	Senior Executive Vice President	—
Dal Soo Lee	02/15/1952	Senior Executive Vice President	192
Jeung Ho Lee	08/15/1952	Senior Executive Vice President	78
Yong Kook Oh	09/30/1949	Senior Executive Vice President	—
Hyo Sung Won	07/29/1960	Senior Executive Vice President	—
Kyung Woo Nam	04/01/1951	Senior Executive Vice President	—
Young Han Choi	09/24/1958	Senior Executive Vice President	—
Byung Kun Oh	01/06/1953	Senior Executive Vice President	155
Sai Yoon Hong	04/11/1954	Senior Executive Vice President	78
Heung Woon Kim	07/20/1957	Senior Executive Vice President	1,600
Kwang Chun Shon	07/21/1956	Senior Executive Vice President	41

6.4. Employees

The following table shows the breakdown of our employees as of June 30, 2008.

(Unit: in millions of Won)

Number of Employees¹

Average Tenure of
the Full-time
Employees (years)²

Total Payment
for the first half
of 2008³

Average Payment
per Person

Full-time

Contractual

Total

Male

13,047

1,453

14,501

18 years and 4 months

517,363

35.7

Female

4,936

6,970

11,905

14 years and 1 month

288,545

24.2

Total

17,983

8,423

26,406

17 years and 3 months

805,908

30.5

¹	Number of employees is calculated as the arithmetic mean of the number of employees as of the end of each month from January 31, 2008 to June 30, 2008, and does not include executive vice presidents, local employees in overseas branches and persons engaged in outsourced services.

²	Based on only full-time employees as of June 30, 2008

³	Based on labor expense and employee benefit / welfare costs paid as of June 30, 2008

7. Major Stockholders and Related Party Transactions

7.1. Major Stockholders¹

The following table presents information regarding the selected major ownership of our shares:

(Unit: Shares, %)


Name	Number of Shares of Common Stock	Percentage of Total Issued Shares
Citibank, N. A.²	55,868,485	16.61
Euro-Pacific Growth Fund	18,377,910	5.46

7.2. Changes in the Largest Shareholder for the Recent Three Years

(Unit: Shares, %)


Name	Date of Change/ Date of Change in Ownership Level³	Number of Shares of Common Stock		Percentage of Total Issued Shares
Korean National Pension Service	February 20, 2008	14,951,343	⁴	4.44	⁴
Euro-Pacific Growth Fund	February 20, 2008	11,629,660		3.46
Euro-Pacific Growth Fund	October 10, 2005	16,099,940		4.79
ING Bank N.V. Amsterdam	March 21, 2005	13,650,001		4.06
Euro-Pacific Growth Fund	January 17, 2005	14,326,220		4.26

7.3. Investments in Affiliates⁵

(Unit: in millions of Won)

Name

Relation with
the Bank

Account

Beginning
Balance
(Jan 1, 2008)

Increase

Decrease

Ending
Balance
(June 30, 2008)

KB Real Estate Trust

Affiliate

Equity Securities of
Affiliate

79,999

—

79,999

KB Investment

Affiliate

Equity Securities of
Affiliate

44,756

—

44,756

¹	As of December 31, 2007.

²	Depositary under our ADR and GDR programs.

As of July 30, 2008, Citibank, N.A., as depositary, held 46,778,471 shares of our common stock, representing 13.91% of our total issued shares.

³	The date of change / change in ownership level is the date as indicated on the public filing disclosing changes in the largest shareholder, etc.

⁴	As of December 31, 2007.

As of July 30, 2008, Korean National Pension Service held 16,895,368 shares of our common stock, representing 5.02% of our total issued shares.

⁵	Jooeun Industrial and KLB Securities are under liquidation procedures.

Name

Relation with
the Bank

Account

Beginning
Balance
(Jan 1, 2008)

Increase

Decrease

Ending
Balance
(June 30, 2008)

KB Asset Management

Affiliate

Equity Securities of Affiliate

30,670

—

30,670

KB Futures

Affiliate

Equity Securities of Affiliate

19,996

—

19,996

KB Data Systems Corp.

Affiliate

Equity Securities of Affiliate

7,999

—

7,999

KB Credit Information

Affiliate

Equity Securities of Affiliate

6,245

—

6,245

KB Life Insurance

Affiliate

Equity Securities of Affiliate

35,700

30,600

—

66,300

KB Investment & Securities Co., Ltd.

Affiliate

Equity Securities of Affiliate

—

75,703

—

75,703

Jooeun Industrial

Affiliate

Equity Securities of Affiliate

9,999

—

9,999

KLB Securities

Affiliate

Equity Securities of Affiliate

24,274

—

24,274

Kookmin Bank Hong Kong Ltd.

Affiliate

Equity Securities of Affiliate

18,764

2,104

—

20,868

Kookmin Bank International (London) Ltd.

Affiliate

Equity Securities of Affiliate

37,482

4,108

—

41,590

T	Based on par value

7.4. Related Party Transactions

(Unit: in millions of Won unless indicated otherwise)

Name

Relation with the Bank

Transactions

Account

Purchase

Disposal

Volume

Gains /
Losses

SK Corportion

Related party of Non-executive director, Chan Soo Kang

Equity securities

52,503

33,152

85,655

-1,631

Total

52,503

33,152

85,655

-1,631

8. Other Important Information for Investors

8.1. Progress Relating to Regulatory Filing

On February 6, 2007, we received a notice of a complaint filed in the Seoul Central District Court by Korea Lottery Services (“KLS”) against us, for a claim for payments of fees in the amount of KRW 445,877,230,980 for the period from June 2004 to December 2006, which was calculated based on the fee rate alleged by KLS. Additionally, KLS claimed interest thereon at the rate of 6% per annum for the period from July 3, 2004 to the date of receipt of notice of the complaint, and 20% per annum for the period from the date immediately following the date of receipt of notice of the complaint to the date of full payment. On July 25, 2008, the Seoul Central District Court ruled in favor of KLS in part but reduced the amount of damages to KRW 122,740,307,360. The court also ruled that we are required to pay certain interest on the unpaid fees. We are planning to appeal such decision.

On July 13, 2007, we submitted a current report on Form 6-K relating to a second notice of additional tax assessment from the Seoul Regional Tax Office in respect of the periodic tax audit for the years 2002 to 2005. This second assessment was in the amount of KRW 268,791,041,795, and in addition to an earlier assessment in the amount of KRW 173,189,962,460. The amount payable in respect of the second assessment was subsequently reduced by KRW 3,006,280,175, in part due to early payment of the assessed amounts. We paid such reduced amount on August 13, 2007.

On August 6, 2007 and August 13, 2007, we appealed the tax assessments in two separate proceedings, distinguished in part by type of tax. The amount of assessment being appealed is KRW 438,862,802,150.

On September 12, 2007, we disclosed that we were reviewing the establishment of a new securities company and/or the acquisition of an existing securities company in pursuit of a possible entry into the securities business. In connection therewith, on March 11, 2008, we acquired 95.8% of Hannuri Investment & Securities Co., Ltd, which was added as a new affiliate of Kookmin Bank and changed its name to KB Investment & Securities Co., Ltd.

On November 6, 2007, we disclosed that we were reviewing internally a possible entry into Central Asian markets (including Kazakhstan) and South East Asian markets through potential acquisitions as part of our overseas expansion strategy. On March 14, 2008, we entered into an agreement to acquire 29.99% of the outstanding shares of Joint Stock Company Bank CenterCredit (“CenterCredit”). We plan to increase our equity stake in CenterCredit to 50.1% or more within 30 months from the closing date of this acquisition.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	Kookmin Bank
	(Registrant)

Date: August 14, 2008	By:	/s/ Donald H. MacKenzie
		(Signature)

	Name:	Donald H. MacKenzie
	Title:	Senior EVP / CFO
		Executive Director

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