The changes in cumulative temporary differences for the years ended December 31, 2016 and 2017, are as follows:
| 2016 | ||||||||||||||||
| Beginning | Decrease | Increase | Ending | |||||||||||||
| (In millions of Korean won) | ||||||||||||||||
|
Deductible temporary differences |
||||||||||||||||
|
Losses(gains) from fair value hedged item |
￦ | 11,882 | ￦ | 11,882 | ￦ | — | ￦ | — | ||||||||
|
Other provisions |
449,239 | 466,913 | 398,537 | 380,863 | ||||||||||||
|
Allowances for loan losses |
5,079 | 26,492 | 51,567 | 30,154 | ||||||||||||
|
Impairment losses on property and equipment |
21,476 | 31,914 | 43,164 | 32,726 | ||||||||||||
|
Deferred loan origination fees and costs |
23,491 | 24,937 | 6,600 | 5,154 | ||||||||||||
|
Interest on equity index-linked deposits |
287 | 287 | 168 | 168 | ||||||||||||
|
Share-based payments |
44,922 | 39,600 | 51,328 | 56,650 | ||||||||||||
|
Provisions for guarantees |
157,954 | 157,954 | 126,319 | 126,319 | ||||||||||||
|
Gains(losses) from valuation on derivative financial instruments |
118,745 | 180,332 | 101,921 | 40,334 | ||||||||||||
|
Present value discount |
42,288 | 14,693 | 19,366 | 46,961 | ||||||||||||
|
Loss on SPE repurchase |
80,204 | — | — | 80,204 | ||||||||||||
|
Investments in subsidiaries and others |
821,059 | 59,354 | 49,014 | 810,719 | ||||||||||||
|
Gains on valuation of security investment |
298,796 | 394,580 | 543,172 | 447,388 | ||||||||||||
|
Defined benefit liabilities |
1,153,686 | 75,269 | 241,718 | 1,320,135 | ||||||||||||
|
Accrued expenses |
271,463 | 358,583 | 1,215,612 | 1,128,492 | ||||||||||||
|
Derivative linked securities |
3,090,264 | 3,098,449 | 132,573 | 124,388 | ||||||||||||
|
Others |
1,220,133 | 557,068 | 739,581 | 1,402,646 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Sub-total |
7,810,968 | ￦ | 5,498,307 | ￦ | 3,720,640 | 6,033,301 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Unrecognized deferred income tax assets: |
||||||||||||||||
|
Other provisions |
67 | — | ||||||||||||||
|
Loss on SPE repurchase |
80,204 | 80,204 | ||||||||||||||
|
Investments in subsidiaries and others |
797,862 | 774,259 | ||||||||||||||
|
Others |
170,214 | 119,334 | ||||||||||||||
|
|
|
|
|
|||||||||||||
|
Total |
6,762,621 | 5,059,504 | ||||||||||||||
|
Tax rate (%)1 |
24.2 | 24.2 | ||||||||||||||
|
|
|
|
|
|||||||||||||
|
Total deferred income tax assets from deductible temporary differences |
￦ | 1,636,968 | ￦ | 1,283,268 | ||||||||||||
|
|
|
|
|
|||||||||||||
|
Taxable temporary differences |
||||||||||||||||
|
Losses(gains) from fair value hedged item |
￦ | — | ￦ | — | ￦ | (59,235 | ) | ￦ | (59,235 | ) | ||||||
|
Accrued interest |
(338,402 | ) | (333,121 | ) | (344,618 | ) | (349,899 | ) | ||||||||
|
Impairment losses on property and equipment |
(1,481 | ) | — | — | (1,481 | ) | ||||||||||
|
Deferred loan origination fees and costs |
(629,161 | ) | (649,107 | ) | (680,891 | ) | (660,945 | ) | ||||||||
|
Gains(losses) from valuation on derivative financial instruments |
(128,985 | ) | (457,371 | ) | (521,629 | ) | (193,243 | ) | ||||||||
|
Present value discount |
(37,741 | ) | (38,009 | ) | (25,722 | ) | (25,454 | ) | ||||||||
|
Goodwill |
(65,288 | ) | — | — | (65,288 | ) | ||||||||||
|
Gains on revaluation |
(1,136,143 | ) | (61,094 | ) | (107,261 | ) | (1,182,310 | ) | ||||||||
|
Investments in subsidiaries and others |
(408,490 | ) | (68,158 | ) | (46,935 | ) | (387,267 | ) | ||||||||
|
Gains on valuation of security investment |
(93,510 | ) | (114,227 | ) | (57,969 | ) | (37,252 | ) | ||||||||
|
Retirement insurance expense |
(996,448 | ) | (63,979 | ) | (238,045 | ) | (1,170,514 | ) | ||||||||
|
Adjustments to the prepaid contributions |
(90,653 | ) | (90,653 | ) | (62,569 | ) | (62,569 | ) | ||||||||
|
Derivative linked securities |
(3,222,110 | ) | (3,401,273 | ) | (356,125 | ) | (176,962 | ) | ||||||||
|
Others |
(426,328 | ) | (663,284 | ) | (1,031,097 | ) | (794,141 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Sub-total |
(7,574,740 | ) | ￦ | (5,940,276 | ) | ￦ | (3,532,096 | ) | (5,166,560 | ) | ||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Unrecognized deferred income tax assets: |
||||||||||||||||
|
Goodwill |
(65,288 | ) | (65,288 | ) | ||||||||||||
|
Investments in subsidiaries and others |
(66,345 | ) | (17,205 | ) | ||||||||||||
|
Others |
(1,914 | ) | (906 | ) | ||||||||||||
|
|
|
|
|
|||||||||||||
|
Total |
(7,441,193 | ) | (5,083,161 | ) | ||||||||||||
|
Tax rate (%)1 |
24.2 | 24.2 | ||||||||||||||
|
|
|
|
|
|||||||||||||
|
Total deferred income tax assets from deductible temporary differences |
￦ | (1,807,838 | ) | ￦ | (1,253,126 | ) | ||||||||||
|
|
|
|
|
|||||||||||||
| 1 | The rate of 24.2% has been applied for the deferred tax assets and liabilities expected to be utilized. |
| 2017 | ||||||||||||||||||||
| Beginning | Business Combination |
Decrease | Increase | Ending | ||||||||||||||||
| (In millions of Korean won) | ||||||||||||||||||||
|
Deductible temporary differences |
||||||||||||||||||||
|
Other provisions |
￦ | 380,863 | ￦ | 30,180 | ￦ | 395,138 | ￦ | 407,923 | ￦ | 423,828 | ||||||||||
|
Allowances for loan losses |
30,154 | — | 26,134 | 202 | 4,222 | |||||||||||||||
|
Impairment losses on property and equipment |
32,726 | 107,755 | 139,743 | 132,346 | 133,084 | |||||||||||||||
|
Deferred loan origination fees and costs |
5,154 | — | 5,154 | 1,207 | 1,207 | |||||||||||||||
|
Interest on equity index-linked deposits |
168 | — | 168 | 155 | 155 | |||||||||||||||
|
Share-based payments |
56,650 | — | 49,333 | 77,185 | 84,502 | |||||||||||||||
|
Provisions for guarantees |
126,319 | — | 126,319 | 88,512 | 88,512 | |||||||||||||||
|
Gains(losses) from valuation on derivative financial instruments |
40,334 | — | 40,334 | 22,758 | 22,758 | |||||||||||||||
|
Present value discount |
46,961 | — | 18,417 | 63,573 | 92,117 | |||||||||||||||
|
Loss on SPE repurchase |
80,204 | — | — | — | 80,204 | |||||||||||||||
|
Investments in subsidiaries and others |
810,719 | — | 753,918 | 76,902 | 133,703 | |||||||||||||||
|
Gains on valuation of security investment |
447,388 | — | 447,388 | 299,082 | 299,082 | |||||||||||||||
|
Defined benefit liabilities |
1,320,135 | 255,375 | 256,580 | 271,857 | 1,590,787 | |||||||||||||||
|
Accrued expenses |
1,128,492 | — | 1,123,713 | 701,756 | 706,535 | |||||||||||||||
|
Derivative linked securities |
124,388 | — | 124,388 | 101,789 | 101,789 | |||||||||||||||
|
Others |
1,402,646 | — | 629,002 | 501,901 | 1,275,545 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Sub-total |
6,033,301 | 393,310 | ￦ | 4,135,729 | ￦ | 2,747,148 | 5,038,030 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Unrecognized deferred income tax assets: |
||||||||||||||||||||
|
Other provisions |
— | — | 2,879 | |||||||||||||||||
|
Loss on SPE repurchase |
80,204 | — | 80,204 | |||||||||||||||||
|
Investments in subsidiaries and others |
774,259 | — | 49,179 | |||||||||||||||||
|
Others |
119,334 | — | 112,030 | |||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Total |
5,059,504 | 393,310 | 4,793,738 | |||||||||||||||||
|
Tax rate (%)1 |
24.2 | 24.2 | 27.5 | |||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Total deferred income tax assets from deductible temporary differences |
￦ | 1,283,268 | ￦ | 95,181 | ￦ | 1,325,367 | ||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Taxable temporary differences |
||||||||||||||||||||
|
Losses(gains) from fair value hedged item |
￦ | (59,235 | ) | ￦ | — | ￦ | (59,235 | ) | ￦ | (57,083 | ) | ￦ | (57,083 | ) | ||||||
|
Accrued interest |
(349,899 | ) | (72,117 | ) | (377,010 | ) | (360,536 | ) | (405,542 | ) | ||||||||||
|
Impairment losses on property and equipment |
(1,481 | ) | — | — | — | (1,481 | ) | |||||||||||||
|
Deferred loan origination fees and costs |
(660,945 | ) | (15,846 | ) | (665,209 | ) | (657,081 | ) | (668,663 | ) | ||||||||||
|
advanced depreciation provision |
— | (6,192 | ) | — | — | (6,192 | ) | |||||||||||||
|
Gains(losses) from valuation on derivative financial instruments |
(193,243 | ) | — | (192,491 | ) | (61,077 | ) | (61,829 | ) | |||||||||||
|
Present value discount |
(25,454 | ) | (8,766 | ) | (34,220 | ) | (16,357 | ) | (16,357 | ) | ||||||||||
|
Goodwill |
(65,288 | ) | — | — | — | (65,288 | ) | |||||||||||||
|
Gains on revaluation |
(1,182,310 | ) | (99,244 | ) | (59,030 | ) | (53,117 | ) | (1,275,641 | ) | ||||||||||
|
Investments in subsidiaries and others |
(387,267 | ) | — | (72,284 | ) | (72,484 | ) | (387,467 | ) | |||||||||||
|
Gains on valuation of security investment |
(37,252 | ) | (236,137 | ) | (273,171 | ) | (764,891 | ) | (765,109 | ) | ||||||||||
|
Retirement insurance expense |
(1,170,514 | ) | (168,714 | ) | (200,722 | ) | (203,506 | ) | (1,342,012 | ) | ||||||||||
|
Adjustments to the prepaid contributions |
(62,569 | ) | — | (61,034 | ) | (57,505 | ) | (59,040 | ) | |||||||||||
|
Derivative linked securities |
(176,962 | ) | — | (176,962 | ) | (20,650 | ) | (20,650 | ) | |||||||||||
|
Others |
(794,141 | ) | (1,215,733 | ) | (429,645 | ) | (95,568 | ) | (1,675,797 | ) | ||||||||||
|
Sub-total |
(5,166,560 | ) | (1,822,749 | ) | ￦ | (2,601,013 | ) | ￦ | (2,419,855 | ) | (6,808,151 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
Unrecognized deferred income tax assets: |
||||||||||||||||||||
|
Goodwill |
(65,288 | ) | — | (65,288 | ) | |||||||||||||||
|
Investments in subsidiaries and others |
(17,205 | ) | (4,546 | ) | (28,407 | ) | ||||||||||||||
|
Others |
(906 | ) | — | (677 | ) | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Total |
(5,083,161 | ) | (1,818,203 | ) | (6,713,779 | ) | ||||||||||||||
|
Tax rate (%)1 |
24.2 | 24.2 | 27.5 | |||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||
|
Total deferred income tax assets from deductible temporary differences |
￦ | (1,253,126 | ) | ￦ | (442,206 | ) | ￦ | (1,854,445 | ) | |||||||||||
|
|
|
|
|
|
|
|||||||||||||||
| 1 | The corporate tax rate was changed due to the amendment of corporate tax law in 2017. Accordingly, the rate of 27.5% has been applied for the deferred tax assets and liabilities expected to be utilized in periods after December 31, 2017. |