KDB Life Insurance Co., a subsidiary of South Korea’s state-run Korea Development Bank (KDB), has fallen into a state of capital impairment.

According to KDB Life Insurance on Monday, its total assets stood at 17.85 trillion won ($12.85 billion) as of the end of March 2025, with total liabilities at 17.99 trillion won, resulting in a negative equity of 134.8 billion won.

“Following the adoption of the new accounting standard (IFRS 17), our insurance contracts were valued at market prices, and valuation losses were reflected due to factors such as falling market interest rates, which resulted in capital impairment,” KDB Life said in a statement. “However, this does not mean that we are unable to pay insurance claims to our customers.”

KDB plans to inject additional funds into KDB Life to resolve its capital shortfall.

The bank had attempted several times to sell the insurer without success since 2014, and ultimately reclassified it as a subsidiary in March.

The total amount of funds injected into KDB Life so far amounts to approximately 1.5 trillion won.

[ⓒ 매일경제 & mk.co.kr, 무단 전재, 재배포 및 AI학습 이용 금지]