Taking the Lead as
THE TOP GLOBAL
FINANCIAL GROUP
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Taking the Lead as
THE TOP GLOBAL
FINANCIAL GROUP
Woori Financial Group Inc. has successfully enrooted the group
system, thereby turning into a comprehensive financial group
capable of sustainable growth. Based on the newly established
foundation of a stable group system and customer trust, Woori
Financial Group is making utmost efforts to maximize corporate
value by engendering bold changes and innovation.
As the WHO declared COVID-19 a pandemic and the global
financial market stands on the brink of a crisis, Woori Financial
Group is strenuously taking action to prepare for the post-
COVID era by preemptively setting up a group-wide crisis
management control tower and deploying strategies that
audaciously push forward digital transformation. Woori
Financial Group will take a step further to faithfully fulfill the
social responsibility of finance and catapult itself to become
a world-leading financial group that always stands alongside
customers as a reliable financial partner.
WOORI FINANCIAL GROUP
ANNUAL REPORT
2019
Woori Overview
012
014
016
018
022
024
026
028
030
032
034
038
Message from the CEO
Board of Directors
Corporate Governance
2019 News Highlights
Financial Highlights
Group Vision & Strategy
Synergy Creation
Digital Innovation
Global Business
Risk Management
Social Responsibility
Special issue: COVID-19
Business
Operations
042
072
074
076
077
078
080
081
083
085
087
Woori Bank
Woori Card
Woori Investment Bank
Woori Finance Information System
Woori Finance Research Institute
Woori Credit Information
Woori Fund Service
Woori Asset Trust
Woori Asset Management
Woori Private Equity Asset Management
Woori Global Asset Management
Financial Review
090
Management’s Discussion and Analysis
120
168
Separate Financial Statements
Consolidated Financial Statements
319
Global Network
Taking a New Step
Forward as a Leading
Financial Group
Having established a holding company in 2019, Woori Financial Group is now
poised to make another leap forward as a comprehensive financial holding company.
Standing on the firm ground of the well-established group system, Woori Financial
Group will become a financial group that takes the lead in the global financial
market by pushing forward aggressive change and innovation under the mission of
becoming a “Reliable Financial Group Shaping the Future.”
Mission
Vision
Core Values
A Reliable
Financial Group
Caring About
Customers
Korea's No. 1
Financial Group,
Leading Global
Finance
Woori Financial Group strives
to fulfill social responsibilities
as a financial group to help our
society grow, and contribute
to creating a future where the
country, people, and our
customers are prosperous
and happy.
Going beyond the No. 1
financial group with
comprehensive services in
Korea and representing Asia,
Woori Financial Group
will take the lead in global
financial markets.
Customer
Happiness
Honesty
and
Trust
Pioneering
for the
future
Talent
First
The First
A New Start of Woori
In 1899, the Emperor invested 30,000
won from the royal treasury for the
foundation of Woori Bank’s predeces-
sor, Daehan Cheonil Bank meaning
‘No.1 bank under the sky’.
After the government acquired 100%
ownership in Woori Financial Group in
2001, the company made strenuous
efforts for privatization which finally
came to fruition 16 years later.
The successful privatization served as a
springboard for Woori Financial Group
to shed its cocoon and make a new leap
forward, fueled by new growth engines.
Expansion to
Global Markets
Based on the largest global network in
Korea, Woori Financial Group expanded
into foreign financial service markets
with a strategic focus on South East Asia
market.
Woori Financial Group was Re-established
on January 11, 2019
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Taking the Lead as the
Top Global Financial Group
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Elevating Woori’s Market
Status and Competitive Edge as
a Full-service Financial Group
Woori Financial Group has solidified its status as a comprehensive financial group through
M&As that better completed the holding company structure. Woori Financial Group will
endeavor to earn the trust of its customers and will secure competitiveness to provide best-
in-class financial services.
Woori Financial Group
(As of Feb. 28, 2020)
100%
100%
59.83%
100%
100%
100%
100%
51%
73%
100%
100%
Woori
Bank
Woori
Card
Woori
Investment
Bank
Woori
FIS
Woori
Finance
Research
Institute
Woori
Credit
Information
Woori
Fund
Service
Woori
Asset
Trust
Woori
Asset
Management
Woori
Private
Equity Asset
Management
Woori
Global Asset
Management
0.80%
Woori-Hanwha Eureka
Private Equity Fund
Tutu Finance-WCI
Myanmar
100%
Korea BTL
Infrastructure Fund 99.88%
Overseas
Subsidiaries
Woori America Bank
Woori Bank China Limited
PT Bank Woori Saudara Indonesia
AO Woori Bank (Russia)
Banco Woori Bank do Brazil S.A.
WB Finance Co., Ltd (Cambodia)
Woori Finance Myanmar
Woori Wealth Development Bank (Philippines )
Woori Bank Vietnam Limited
Woori Bank Europe Gmbh (Germany)
Woori Global Markets Asia Limited (Hong Kong)
100%
100%
79.88%
100%
100%
100%
100%
51%
100%
100%
100%
WOORI CARD
Transferred
as Subsidiaries
2019
WOORI
INVESTMENT
BANK
WOORI
FUND SERVICES
WOORI
PRIVATE EQUITY
ASSET
MANAGEMENT
WOORI
FINANCE RESEARCH
INSTITUTE
WOORI
CREDIT
INFORMATION
WOORI BANK
WOORI
FINANCIAL
GROUP
WOORI FIS
Mergers &
Acquisitions
2019
WOORI
ASSET TRUST
WOORI
GLOBAL ASSET
MANAGEMENT
WOORI
ASSET
MANAGEMENT
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Delivering the Greatest-
Possible Customer Value
through Digital Innovation
Woori Financial Group has declared the new digital vision of “Digital for Better Life,”
facing head on the rapidly changing financial trends in this age of the “un-tact.”
Furthermore, Woori Financial Group will bolster external cooperation through open
innovation strategies and maximize customer value through innovative digital
technologies including AI and Big Data.
Digital Vision
DIGITAL FOR BETTER LIFE
Slogan
DIGITAL FIRST, CHANGE EVERYTHING
Digital Strategy
OPEN INNOVATION STRATEGY
Open up customer channels
to external participants
OPEN
CUSTOMER
OPEN
FINANCE
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OPEN
DATA
Explore new
services by opening
up the financial data
maintained by
Woori Bank
OPEN
API
Open up Woori
Bank’s exclusive
products and services
to external
participants
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Ultra-
Personalized
Services
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Digital First, Change EverythingBIG DATAAICLOUDBLOCK CHAIN
Leading the Global
Market Based on a
Broader Global Network
Woori Financial Group pioneers into the global market through localized
sales strategies and differentiated non face-to-face channels. Going forward,
Woori Financial Group will reinforce its standing as a world-leading financial
group by increasing the share of its overseas revenue to the 40-percent level
of total earnings.
Vietnam
- Five new branches opened
- Bancassurance, credit card
business launched
01
Glocalization
Group Total Networks
476
Overseas Subsidiaries
12
Overseas Branches
(including subbranches)
22
Representative Office
5
(As of Mar. 31, 2020)
UKChinaHong KongRussiaBahrainU.A.EGermanyIndiaBangladeshMyanmarJapanSingapore Poland Australia Indonesia CambodiaPhilippinesMalaysiaVietnam Vietnam, Cambodia
Myanmar, Indonesia
- Sales channels secured in regions
of promising growth
- Qualitative growth of asset portfolio
driven by sound assets
02
Level-Up
G l o b a l N e t w o r k s
S t r a t e g y
Cambodia
- Merger of Woori Cambodia
Finance and WB Finance
approved
04
Diversification
G
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Digitalization
Bangladesh, China
Vietnam, Indonesia
- QR Pay services launched
- Tablet branches expanded
- Non face-to-face-only products
launched
(As of Dec. 31, 2019)
Liquidity Ratio
Net Profit of Global Business
Woori Bank Vietnam
116.1%
+ 5.6%p
KRW224 billion
+ 15.8%
KRW+10billion
achieved net profit in just
3 years into incorporation
Woori America BankLos AngelesNew YorkBrazil
Taking a Step Further to
Become the No.1 Financial
Group – ‘Woori Together’
Woori Financial Group bolsters core competencies centered on the
seven management strategies of 2020 and grows alongside customers
by practicing sustainable management in non-financial areas.
Woori Financial Group will become the No.1 comprehensive financial
group through trust and innovation and will become a reliable financial
group that has the unwavering trust of customers.
7 Management Strategies
Customer-
Centric Business
Innovation
Risk
Management /
Internal Controls
Innovation
Sustainable
Growth Engine
Reinforcement
Business
Portfolio
Enhancement
Digital
Innovation
Leadership
Elevation
of Global
Business
Woori Together
Synergy
Expansion
Business Diversification
Digital Innovation
M&A
Digital Innovation Committee
Bolstering the Business Portfolio
Bank in Bank (BIB) System
Implementing the Main Business
Unit System
Open API
A-D Venture
Digital Innovation Lab
Global Level Up
Woori Together
Expanding the Global Network
Boosting the Global Digital
Competence
Creating Synergies with Local
Partners Worldwide
Regaining
Customer Trust through
Change and Innovation
Environment
Society
Governance
Introducing electric
business vehicle and
launching electricity-
saving campaign to
reduce GHG emissions
Realizing socially
responsible finance
through inclusive
financial policies
Newly establishing
the Internal Control
Management
Committee to
reinforce governance
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2020 and
Beyond
No.1
Financial
Group
in Korea
Benefit from Finance,Warmth from Sharing
012
MESSAGE FROM THE CEO
Going Beyond
the No.1 Financial
Group in Korea
We leveled-up our
corporate value through
successful conversion
into a holding company
structure after
four years of planning.
Firstly, allow me to extend my heartfelt gratitude to shareholders and customers for their
warm support for Woori Financial Group.
The year 2019 was a meaningful year for Woori Financial Group, as we established a holding
company and successfully laid the groundwork for the group system. Backed by the
strong support of our shareholders and customers, we were able to bring in two asset
management companies and one real estate trust company to the Group, which allowed us
to quickly become a full-fledged comprehensive financial group.
Moreover, despite harsh financial environment both at home and abroad, Woori Financial
Group was recognized to have the highest growth potential in the market and to be one of
the most competitive financial groups in Korea with the best-ever performance in growth
and profitability.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Message from the CEO
013
Strengthening
the group's non-
banking business
and corporate
value through
M&As.
Furthermore, we expanded our global networks to 474 as of the end of 2019 and posted tremendous
growth in overseas revenue, further solidifying our position as a global financial group.
As such, the unsparing support from our shareholders and customers made 2019 a year of countless
proud achievements for Woori Financial Group.
In order to boost our credibility among customers based on our stabilized group system in 2020,
Woori Financial Group sets its management goal for 2020 as “Becoming the No.1 Financial Group
through Customer Trust and Innovation,” thereby maximizing its corporate value and rising up to the
level of support from its shareholders.
Firstly, we will continue to expand our business portfolio and build upon our firm foundation backed
with more robust financial performance and a stable equity ratio, which will pave the way for contin-
ued growth as a group.
Secondly, in response to the dramatic shift in the financial paradigm, we will forge ahead as a group
towards digital transformation and take on challenges in new areas with a mindset that embraces
creative agility and innovation, in order to discover new growth engines for the Group.
Furthermore, to complete the most important mission of “Becoming the No.1 Financial Group through
Customer Trust,” we will level up both our system and our operational competency in risk management
and internal controls. We also pledge to continue groundbreaking innovation in all areas, including
evaluation, organization and systems, in order to enable the framework for a customer-centric business
to truly take hold.
Last but not the least, Woori Financial Group will strive to be fully socially responsible in all aspects
of financial areas in 2020 by supporting innovative finance, providing microfinance and supporting
SMEs.
As we move into the second year since the launching of Woori
Financial Group, Inc., I ask for your kind encouragement in our
journey of greater development and growth. All of us here at
Woori Financial Group will continue to make our utmost effort to
maximize shareholder value and bring you greater contentment.
I wish all our shareholders and customers the best of luck and
happiness.
Thank you.
Son, Tae Seung
Chairman & CEO, Woori Financial Group
Woori OverviewBusiness OperationsFinancial Review 014
BOARD OF DIRECTORS
Son, Tae Seung
Lee, Won Duk
Standing director (Chairman & CEO)
Standing director (Deputy President)
‧ (Current) Chairman & CEO, Woori Financial Group
‧ President & CEO, Woori Bank
‧ Head. Global Business Unit, Woori Bank
‧ LLM, Seoul National University
‧ LLB, Sungkyunkwan University
‧ (Current) Deputy President, Strategy Planning Unit,
Woori Financial Group
‧ Executive Vice President, Management and Finance Planning Group,
Woori Bank
‧ Managing Director, Future Strategy Division, Woori Bank
‧ M.A. in Economics, Seoul National University
‧ B.A. in Agricultural Economics, Seoul National University
Ro, Sung Tae
Outside director
‧ (Current) Chairman, Samsung Dream Scholarship Foundation
‧ President, Hanwha Life Economic Research Institute
‧ President, Korea Economic Research Institute
‧ M.A. and Ph.D. in Economics, Harvard University,
the graduate school of Arts and Sciences
‧ B.A. in Economics, Seoul National University
Park, Sang Yong
Outside director
‧ (Current) Auditor, Yonsei Foundation
‧ (Current) Professor Emeritus, Yonsei University
‧ Civilian Chair, Public Fund Oversight Committee
‧ Dean, School of Business, Yonsei University
‧ M.A. and Ph.D. in Business Administration, New York University,
the graduate school of Arts and sciences
‧ B.A. in Business Administration, Yonsei University
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Board of Director
015
Chung, Chan Hyoung
Outside director
‧ CEO, POSCO Capital
‧ Vice Chairman, Korea Investment Management
‧ CEO and President, Korea Investment Management
‧ MBA in Finance, Korea University Business School
‧ B.A. in Business Administration, Korea University
Dennis Chan
Outside director
‧ Vice Chairman, Fubon Bank (China)
‧ CEO, Fubon Bank (China)
‧ Senior Vice President, Strategic Planning, Fubon Financial Holdings
‧ M.A. in Business Administration, Georgetown University,
the graduate of Arts and sciences
‧ B.A. in Business Administration, Taipei National University
Tian, Zhiping
Outside director
‧ (Current) Vice President, Beijing FUPU DAOHE Investment
Management Ltd.
‧ Vice President, ICBC Middle East Ltd. & ICBC Londong Ltd.
‧ Vice President, Industrial and Commercial Bank of China, Branch of
Sichuan Province
‧ IMBA, University of Hong Kong/ MBA, Southwestern University of
Finance and Economics
‧ B.A. in Government Economics Management, Shanxi University of
Finance and Economics
Chang, Dong Woo
Outside director
‧ (Current) CEO, IMM Investment Corp.
‧ Representative Partner, IMM Investment Corp.
‧ ABAS Leader-AKT, Samil Accounting Corp.
‧ Audit Department, Younghwa Accounting Corp.
‧ LLB, Hanyang University
Kim, Hong Tae
Non-standing director
‧ (Current) Head, Office of Creative Management, KDIC
‧ Deputy General Manager, Department of HR and Administration,
KDIC (Korea Deposit Insurance Corporation)
‧ Hana Bank
‧ B.A. in International Economics, Seoul National University
Woori OverviewBusiness OperationsFinancial Review 016
CORPORATE GOVERNANCE
Corporate Governance Policies
of Woori Financial Group, Inc
In order to protec t the interests of stakeholders, including
shareholders and financial consumers and to promote long-term
development, Woori Financial Group maintains a stable, efficient
and transparent corporate governance structure. A stable corporate
governance structure can be established and maintained through the
checks and balances of members based on their independence, an
efficient corporate governance through expertise and the dedicated
operation of the Board of Directors (BOD), and a transparent corporate
governance through the disclosure of work handling standards and
results.
Independence of the BOD
Expertise and Diversity
To ensure professionalism and the diversity of views, the BOD consists
of outside directors from various backgrounds and professional
fields. As of the end of March 2020, there is one economic expert,
three financial experts, one business administration expert and one
accounting expert on the Board. The diversity of outside directors
form an eclectic group which includes a university professor, a
researcher and a financial company CEO. Woori Financial Group takes
into consideration the innate nature of a financial holding company as
one that spans the entire financial industry, and it therefore strives to
appoint outside directors who have expertise in multiple areas. In fact,
its current outside directors have expertise in two or more areas.
Moreover, as Woori Financial Group’s global net income accounts for
more than 10 percent of the total earnings, it forms its BOD to represent
In order for the BOD and its Committees to operate in a stable
individuals from diverse national backgrounds so that a more global
and sound manner, Woori Financial Group complies with the Act
perspective can be reflected into its business management. As of the
on Corporate Governance of Financial Companies and relevant
end of March 2020, the BOD was comprised of four members from
regulations thereof, while incorporating key provisions into internal
Korea, one from China and one from Taiwan. In addition, Woori
regulations. Woori Financial Group particularly recognizes and
Financial Group endeavors to create more gender equity by ensuring
endeavors to uphold independence as a critical value that enables
female outside directors on the board. It mandates that women make
the BOD to responsibly supervise the management. In accordance
up at least 10 percent of the outside director candidate pool, and based
with Article 35 of the Articles of Association, the Board consists of a
on this rule, Woori Financial Group plans to appoint female outside
majority of outside directors and pursuant to Article 44, the Chairman
directors going forward.
of the BOD is appointed from among outside directors. Since its
establishment in 2019, Woori Financial Group’s BOD has been chaired
Dedicated and Transparent BOD Operation
by outside directors.
As per its internal regulations on corporate governance, the Officer
Candidate Recommendation Committee, Audit Committee, Risk
Management Committee, Compensation Committee and Internal
Control Management Committee are chaired by outside directors and
consist of a majority of outside directors. In particular, outside directors
must form two-thirds of a) the Officer Candidate Recommendation
Committee that recommends candidates for the positions of President
& CEO and outside directors; and b) the Audit Committee that oversees
business execution by the management. As of the end of March 2020,
these two Committees consist entirely of outside directors.
Furthermore, to prevent collusion between outside directors and
the management and to ensure that outside directors are replaced
sequentially, a term of office policy applies. An outside director may
not serve for longer than six years at Woori Financial Group or for nine
years of combined time at subsidiaries, etc.
A BOD can operate efficiently with the expertise of outside directors
who wholeheartedly dedicate themselves to participating on the BOD
and Committee meetings. As such, dedication, along with expertise,
is the standard by which Woori Financial Group appoints outside
directors. In 2019, a total of 14 BOD meetings were convened with a
94-percent of directors attending. The Board discussed a total of 61
agenda items, including the establishment of corporate governance
regulations, development of a Woori Financial Group business plan,
submission of bidding proposals to asset management companies and
the approval of an all-inclusive share swap between Woori Financial
Group and Woori Card. To ensure the transparency of work handling
standards, procedures and outcomes, Woori Financial Group discloses
how the amendment of its internal regulations and other key matters
are being handled on its website. Each year on its website and on
the website of the Korea Federation of Banks, Woori Financial Group
uploads the following: internal regulations including the Articles of
Association and BOD Regulations; corporate governance including
a run-through of BOD activities; and the Annual Report. This report
consists of its internal regulations such as the Articles of Association
as well as BOD regulations and activities. All materials disclosed thus
far and to be disclosed going forward are and will be available on the
following website: http://www.woorifg.com.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Corporate Governance
017
Composition of the BOD and Its Committees
As of the end of March 2020, BOD consists of nine directors (six outside
company in the market to establish an Internal Control Management
directors, one non-standing director and two standing directors), and
Committee, which makes suggestions on effective internal control
outside directors account for 67 percent of the BOD.Six Committees
standards by reviewing the outcomes of the Group’s operational status
have been operating under the BOD, including the Audit Committee.
inspection.
On March 25th 2020, Woori Financial Group became the first financial
*Please refer to the attachment for details on BOD composition.
Name of Committees
Members
Key Roles
Audit
Committee
Chung, Chan Hyoung (Chairman)
Ro, Sung Tae
Chang, Dong Woo
Outside director
Outside director
Outside director
• Supervising the work of directors and management
• Selecting and requesting the dismissal of
independent auditor
Risk Management
Committee
Compensation
Committee
Park, Sang Yong (Chairman)
Dennis Chan
Tian, Zhiping
Kim, Hong Tae
Lee, Won Duk
Outside director
Outside director
Outside director
Non-standing director
Standing director
• Devising basic rules and strategies of risk
management
• Determining the level of tolerable risk
• Approving the risk capital limit and loss limit
• Establishing and amending risk management
standards
Chung, Chan Hyoung (Chairman)
Ro, Sung Tae
Park, Sang Yong
Dennis Chan
Tian, Zhiping
Chang, Dong Woo
Kim, Hong Tae
Outside director
Outside director
Outside director
Outside director
Outside director
Outside director
Non-standing director
• Evaluating the design and operation of the
performance compensation system
• Establishing and implementing independent
compensation policies
• Determining recipients of performance
compensation in the management
• Evaluating performance of officers and providing
compensation
• Filing and disclosing Annual Reports, Reporting on
the operations of performance compensation
• Recommending candidates for the positions of
Chairman & CEO, outside directors, and members of
the Audit Committee.
• Recommending candidates for the position of CEO
of subsidiaries
Officer Candidate
Recommendation
Committee
Group CEO
Candidate
Recommendation
Committee
Chang, Dong Woo (Chairman)
Ro, Sung Tae
Park, Sang Yong
Chung, Chan Hyoung
Dennis Chan
Tian, Zhiping
Outside director
Outside director
Outside director
Outside director
Outside director
Outside director
Son, Tae Seung (Chairman)
Ro, Sung Tae
Park, Sang Yong
Chung, Chan Hyoung
Dennis Chan
Tian, Zhiping
Chang, Dong Woo
Standing director
Outside director
Outside director
Outside director
Outside director
Outside director
Outside director
Internal Control
Management
Committee
Park, Sang Yong (Chairman)
Kim, Hong Tae
Son, Tae Seung
Outside director
Non-standing director
Standing director
• Matters concerning standards on building and
operating the internal control system
• Matters concerning outcomes of operational status
inspection of the Group’s internal control system
Woori OverviewBusiness OperationsFinancial Review 018
2019 NEWS HIGHLIGHTS
2
Successful M&As with Non-
Banking Companies Enhance the
Group’s Business Portfolio
Acquired Entities: Tongyang Asset
Management (Woori Asset Management),
ABL Global Asset Management
(Woori Global Asset Management),
Kukje Asset Trusts (Woori Asset Trust)
Woori Financial Group succeeded in acquiring
Tongyang Asset Management and ABL Global
Asset Management in August 2019 and Kukje
Asset Trusts in December 2019. In its very
first year, Woori Financial Group successfully
completed a series of non-banking M&As
with asset management companies and a real
estate trust company. This not only bolstered
its foundation for building a comprehensive
financial group system, it brought one step
closer to becoming the nation’s No. 1 financial
group.
The asset management companies have
already been incorporated into its affiliates,
creat ing s y nerg y in mul t iple areas by
expanding fund sales through bank channels
and providing various specialized products
and services to Woori Bank customers. Going
forward, it plans to develop these into best-
in-class asset management companies by
leveraging the brand and networks of Woori
Financial Group Meanwhile, Kukje Asset
Trusts has been incorporated as a subsidiary
in December, 2019. Upon being fully affiliated,
Woori Asset Trust will raise the Group’s market
presence by performing key roles in real estate
development finance. Woori Financial Group
will continue to broaden its non-banking
business por t folio through M& A s with
consumer loan company and savings bank as
well as with security firm and insurers, thereby
quickly filling in its business portfolio line-
up and continuing to reinforce its status and
competitiveness as a leading financial group.
1
Woori Financial Group Successfully Launched and
Newly Listed on the Korea Exchange
In 2019, the status of Woori Financial Group
was expanded to encompass 11 subsidiaries as
grew immensely as it became known as a
Woori Card and Woori Investment Bank became
comprehensive financial group and made
subsidiaries and the scope of their non-banking
its marvelous debut return as the leader of
business portfolio grew considerably. Under
finance. The establishment of Woori Financial
this new structure, the group is enhancing the
Group was approved by the Financial Services
financial benefits for the customers and the
Commission in November 2018, was officially
capacity to provide comprehensive financial
launched on January 11th 2019, and was listed
services through offering customized one-
on the Korea Exchange on February 13th 2019.
s top comprehensive asset management
As the sole remaining commercial bank in
innovations with both it s produc t s and
Korea without a holding company structure,
service. Furthermore, Woori Financial Group
Woori Financial Group had previously faced
is promoting transformation in the Korean
challenges in prov iding comprehensi ve
financial market though digital innovation and
financial services aligned with non-banking
taking the lead in fulfilling social responsibility
affiliates. Now that the conversion into a holding
for the financially underprivileged, innovative
company structure is complete, the foundation
enterprises and SMEs. It started off 2019 with
has been laid for intensified competitiveness
a revival of sorts as a comprehensive financial
as a comprehensive financial group. Initially,
group, and in 2020, Woori Financial Group is
Woori Financial Group was comprised of six
expected to level up its status by truly becoming
subsidiaries which included Woori Bank, 16
the nations’ premiere comprehensive financial
second-level subsidiaries including Woori
group that spearheads global finance.
Card and one third-level subsidiary (overseas
subsidiary of Woori Card). Later, this structure
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 2019 News Highlights
019
3
5
Launch of Woori WON Banking – a New Smart Banking System
Woori Card and Woori
Investment Bank Incorporated as
Group Subsidiaries, Accelerating
Completion of Holding Company
Structure
In September 2019, Woori Financial Group
brought in Woori Card and Woori Investment
Bank, previously under Woori Bank, to the
holding company. The transfer follows the
initial plan of incorporating the largest-
sized major affiliates (after Woori Bank) into
holding company subsidiaries within the first
year of establishing Woori Financial Group
in order to quickly stabilize the group system
and forge ahead with non-banking sector
reinforcement without disruption. With this
transfer, all domestic affiliates of the Woori
Financial Group have been incorporated
as holding company subsidiaries. Woori
Card was incorporated as a 100 percent full-
subsidiary of the holding company through
an all-inclusive share swap. Meanwhile, taking
into account that Woori Investment Bank is
a stock-listed corporation, the entire 59.83
percent of its stake owned by Woori Bank was
purchased in cash. As a result, Woori Financial
Group boosted its capital adequacy ratio
with new shares issued from the all-inclusive
share swap. Woori Card and Woori Investment
Bank are expected to raise their profitability
by generating inter-subsidiary cooperation.
Meanwhile, new shares issued through the all-
inclusive share swap were initially owned by
Woori Bank in the form of mutual ownership,
but were later sold to Taiwan’s Fubon Financial
Holding in September 2019 and then to
domestic and overseas long-term investors
in November 2019. By selling all the shares,
Woori Bank relinquished itself from any issues
regarding share overhang.
Card statement without having to go through
a separate process. Last but not least, Woori
WON Banking offers tailored recommendations
for products based on the transaction patterns
and age of the particular user. Products sold on
Woori WON Banking have also been realigned
to strongly feature major products. Woori WON
Banking was developed with the scalability
of diverse services in mind in an age led by
customers through open API. It is truly the most
advanced service that heralds in the new age of
open finance. The new smart banking system,
“Woori WON Banking” is expected to take hold
as a service that leads open banking in the
finance sector.
Woori Bank launched its new smart banking
system, “ Woori WON Banking” on August
16 2019. WON combines the ‘W’ from Woori
(meaning ‘us’) with the word, ‘ON’ (meaning
‘to turn on’ and ‘online’). Woori WON Banking
is an online bank that provides easy-to-use
financial services for its customers to access at
any time, in any place. With the aim of providing
customer-centric, remote financial services,
Woori Bank developed Woori WON Banking
with three key values in mind: simple screen
conf iguration and menu; timely f inancial
information; and individually tailored services.
The Woori WON Banking platform is intuitive in
that it places the frequently used ‘inquiry and
transfer’ functions on the home screen and
offers users a choice between card-types and
list-type displays. Furthermore, the product
subscription process has been simplified
to include only five steps and the ‘continue
subscription’ feature makes continuing a
subscription a seamless task. With Woori WON
Banking, users can easily pay their utility bills
through Naver AI and even check their Woori
4
The “Standard of Cards” Series by Woori Card Surpasses 5 Million
Accounts in Subscription and Wins Brand of the Year Korea 2019 Award
The “Standard of Cards” series, a leading
product from Woori Card, surpassed 5 million
subscriptions in just 20 months since its
launching, which makes it the fastest growing
single product series in the industry. What
makes this achievement even more significant is
the fact that Woori Card outcompeted a leading
credit card company that had had a far larger
margin of members. The key driver behind the
success of the series was a “customer-centric
mindset” thoroughly reflected throughout all
stages of product planning, service composition
and design. Advantages such as discounts and
point-earning features developed through Big
Data analysis and consumer research resonated
with consumers. The cards also display the
work s of the famous Korean traditional
artist, Kim Hyun-Jung, which portray Korean
aesthetics in a captivating design. Woori Card
also engaged in completely new attempts
with its efforts in marketing and branding. In
April 2019, new products were introduced at
a collaborated exhibition with the painter Kim
Hyun-Jung. Woori Card also combined art and
advertising, demonstrating a differentiated
means of communication through a creative
hybrid known as “art-vertising”. These efforts
won Woori Card the Financial Sector Award at
Brand of the Year 2019 Korea, hosted by the
Korea Marketing Association. The “Standard of
Cards” series stood out above the rest because
it was widely recognized as the brand leader
of the market through customer-centric and
innovative branding activities
Woori OverviewBusiness OperationsFinancial Review 020
6
8
Woori Bank, a Digital Powerhouse, Wins Digital Management Grand
Woori Bank Becomes First
Award at Management Grand Awards 2019
Woori Bank received the Digital Management
and organizational operation. In August 2019,
Grand Award at the Management Grand
the customer-centric mobile banking system
A w a r d s 2 0 19 – t h e m o s t p r e s t i g i o u s
known as “ WON Banking” was renewed,
management awards presented by the Korea
building a flagship digital marketing platform
Management Association Consulting (KMAC).
for Woori Financial Group. Moreover, based on
The Management Grand Awards have been
multifaceted collaboration and partnerships
held since 1988 and honor companies that
with ICT companies and fintech firms including
have gained great respect and credibility
Samsung Electronics, Kakao and Bank Salad,
while presenting outstanding innovation-
Woori Bank continued to churn out joint
driven performance in the rapidly changing
products and services, while expanding the
global business environment. Woori Bank
operation of its Fintech Lab in order to bolster
implemented a “BiB (bank-in-bank)” system that
the discovery of, as well as collaboration and
enables the independent pursuit of business in
partnership, with startups. Such exceptional
digital finance. Independence and autonomy
per formance in leading digital business
were guaranteed by providing full budgeting
management was recognized and honored by
autonomy and authorization over manpower
receiving the Grand Award.
7
Woori Financial Namsan Tower Opens Up the Era of
Woori Financial Town
Woori Bank purchased Woori Financial Namsan
that it is facing the head office may also provide
Tower located in Sogong-ro in August, creating
an additional added benefit for Woori Financial
“Woori Financial Town” in the Hoehyeon-dong
Group from a PR s tandpoint. Moreover,
area in Jung-gu, Seoul where the head office is
securing more office space can also help
located. On November 1st, the head office of
affiliates save on costs in office lease expenses.
Woori Investment Bank in Seoul officially moved
Woori Financial Namsan Tower consists of two
in, marking an important turning point towards
basement floors and 22 floors aboveground.
becoming the No.1 comprehensive financial
A massive remodeling project in 2014 secured
group in the nation. Woori Financial Group, after
the building and the name, “Woori Financial
having been converted into a holding company
Namsan Tower” was chosen through a public
in 2020, enhanced its business por t folio
competition held by Group employees. The
through successful non-banking M&As and is
Digital Financial Group and Woori Bank’s IT
currently reviewing M&As with securities firms
Group are presently in the process of moving
and insurers, which indicates a higher demand
in and with the Woori Investment Bank first
for office space at the headquarters. Woori
to move, Group affiliates are relocating to the
Financial Namsan Tower is just across the street
Tower one by one. This seems to be bolstering
from the head office. With such exceptional
the synergetic effect and forming a basis for a
accessibility, the location is considered optimal
stable collaborative system.
to concentrate the currently dispersed affiliates
into one place to generate synergy and the fact
Financial Company to Win
Presidential Commendation
Award at the 54th Invention Day
On May 27 2019, Woori B ank recei ved
commendations in the Group and Individual
categories at the 54th Invention Day Ceremony
at Coex, hosted by the Korea Intellectual
Property Office (KIPO). The Invention Day
Ceremony is a national event hosted by KIPO
(Commissioner Park Won Joo) and organized
by the Korea Invention Promotion Association
(President Koo Ja Yeol), where the Order of
Industrial Service Merit, Industrial Service
Medal and Presidential Commendation
Award are presented to honor those who
have made significant contributions to the
industrial development of Korea. Six hundred
participants including Prime Minister Lee
Nak Yeon, heads of invention and patent
organizations, inventor s and s tudent s
all at tended the ceremony. Woori Bank
received the highest honor of “Presidential
C o m m e n d a t i o n A w a r d ” i n t h e G r o u p
Contribution to Invention category, for making
investments in R&D for innovation in digital
finance; raising international competitiveness
through trademark branding in Korea and
abroad; and producing quality intellectual
property with its in-house experts. The award
raised awareness for intellectual property
among employees. Furthermore, by becoming
the first financial entity to win this award,
Woori bank also proved that intellectual
proper t y rights such as patents are not
exclusive to manufacturers only. Winning this
award is expected to invigorate intellectual
property rights in the financial sector and lay
a cornerstone for “digital finance,” in fitting in
with the fourth industrial revolution.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 2019 News Highlights
021
10
Woori FIS Succeeds in Building
WGSS In-House
Woori FIS successfully completed the 15-
month project from November 7th 2017
to February 6th 2019 of building the Woori
Global Standard System ( WGSS) for the
o v er s eas b r an c h e s of Wo o r i B ank (13
networks in 10 nations) and the subsidiaries
in Europe and the Philippines. This project
was geared towards expanding overseas
networks, effectively pursuing local retail
businesses and responding to compliance
regulations by transitioning the banking
systems (account system/information system/
local channels) of overseas branches and
the information system of the parent bank
from the previous WinFOS system to the new
WGSS. In particular, this project was the very
first large-scale project by Woori FIS that was
developed in-house. The project is all the
more meaningful in that Woori FIS took on
the entire development process spanning
design, analysis, deployment and application,
unlike other projects that build new systems
for overseas subsidiaries. Based on the
capacity it built in operating the overseas
branch system, Woori FIS contributed to
the overall stable opening and operation of
overseas branch systems that were high in
quality, level of completion and consistency
in post-development operations. Leveraging
its success in expanding the new system for
overseas branches of Woori Bank, Woori FIS
plans to carry out the Group’s global strategy
by taking active participation in the planned
project to develop new systems for overseas
subsidiaries. Furthermore, by utilizing its
capacity to operate the best financial IT in
Korea, Woori FIS is pushing ahead for the in-
house development of the Group’s new IT
9
CSR Fulfilled through Group-Wide Social Contribution Campaign,
“Better Together Woori”, Marking the 120th Anniversary of Woori Bank
and Inauguration of the Holding Company
Celebrating the 120th anniversar y of the
of co-grow th bet ween the company and
founding of Woori Bank and the launching of
local communities. In particular, 14 different
the holding company, Woori Financial Group
communication channels including interview
deployed a Group-wide CSR campaign called,
videos, V-log videos and card news items
“Better Together Woori” to realize the social
were produced about global CSR activities
values of finance. Not only domestic branches,
and uploaded on the bank’s social channels
but 469 global networks in 26 nations, took
(Facebook, Instagram, etc.). They received
part in this campaign that was carried out
positive reviews, recording 250K hits and
in two parts: once in the first half of the year
24K likes. In addition, Woori Financial Group
( Jan. to Mar.) and once in the second half
engages in a variety of CSR activities throughout
(Oct. to Nov.). Domestic branches voluntarily
the year, including the “Clean Air” support
launched CSR activities tailored to community
project for community children’s centers,
needs by supporting social welfare centers
blood drive campaigns, and Woori Box of Hope
and the socially marginalized. Overseas
delivery on holidays. Woori Financial Group
networks engaged in volunteer activities that
also endeavors to support natural disaster
best catered to the characteristics of the host
recovery by launching a support project for the
system.
nations including support for Hangul School,
recovery from the Gangwon Province forest
the Paraplegic team, children with rare and
fire, producing disaster relief kits ‘ex-ante’
incurable illness, and returned migrant workers.
and inaugurating the Woori Financial Group
The campaigns served as a model example
Volunteer Corps.
Woori OverviewBusiness OperationsFinancial Review 022
FINANCIAL HIGHLIGHTS
Net Income Attributable to Controlling Interests
(Unit: KRW in billions)
Interest Income (Unit: KRW in billions)
Bank
Group
5,894
5,651
5,221
5,019
Group
Bank
2019
2018
2017
2016
YoY
+4.3 %
1,261
1,512
1,872
2,033
*Consolidated basis
*Consolidated basis
2016
2017
2018
2019
NIM & Core Deposit (Unit: KRW in trillions)
NIM
Core Deposit
Bank
1.52%
1.47%
1
7
5
7
1.44%
2
8
1.41%
6
6
2016
2017
2018
2019
Fees and Commission (Unit: KRW in billions)
Profitability (ROA & ROE) (Unit: %)
ROE
ROA
Bank
Group
Bank
Group
1,103
1,070
1,070
937
YoY
+3.1 %
9.69
7.42
0.48
0.62
6.36
0.41
9.29
0.52
*Consolidated basis
*Consolidated basis
2016
2017
2018
2019
2016
2017
2018
2019
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Financial Highlights
023
Cost-to-Income Ratio (Unit: %)
Credit Cost Ratio (Unit: %)
NPL Ratio (Unit: %)
Bank
Group
Bank
Group
Bank
Group
56.1
49.9
50.8
52.0
0.37
0.34
0.13
0.15
0.99
0.85
0.54
0.45
2016
2017
2018
2019
2016
2017
2018
2019
2016
2017
2018
2019
* Consolidated basis (Excluding ERP Expense)
* Consolidated basis
*Consolidated basis
Loan Portfolio (Unit: %)
Large Corp.
SME
Retail
Public & Others
Assets (Unit: KRW in trillions)
Loans in Won
Total Assets (Including AUM)
Liabilities (Unit: KRW in trillions)
Deposit
Total Liabilities
YoY
2016
1.7
2017
1.4
2018
1.1
2019
1.0
47.4
32.7
18.2
48.0
34.4
16.2
48.5
34.8
15.6
49.3
36.0
13.7
B
a
n
k
G
r
o
u
p
2016
2017
2018
2019
+21.8 %
191
343
200
356
211
389
221.7
473.8
2016
2017
2018
2019
B
a
n
k
G
r
o
u
p
*FSS NPL reporting standards
*Consolidated basis
*Consolidated basis
YoY
+5.7%
221
290
235
296
249
318
265
336
B
a
n
k
G
r
o
u
p
Dividend
Capital Adequacy (Unit: %)
BIS Ratio
Tier1 Ratio
CET1 Ratio
Bank
Group
Bank
Group
Dividend per Share
(KRW)
Dividend Yield
(%)
Dividend Payout Ratio
(%)
2016
2017
2018
2019
400
600
650
700
3.0
3.7
4.0
5.8
21.4
26.7
21.5
27
15.3
12.7
10.5
15.4
13.0
11.0
15.7
13.2
11.2
15.4
13.2
11.0
11.9
9.9
8.4
* 2017 : including the interim dividend
(KRW 100 per share)
2016
2017
2018
2019
2019
* ~ 2018 (Woori Bank) : IRB Method
2019~ (Woori Financial Group) : Standardized Method (Temporarily applied after
FHC conversion / Awaiting approval for IRB approach)
Woori OverviewBusiness OperationsFinancial Review
024
GROUP VISION & STRATEGY
The controlling company, Woori Financial Group, is a holding
Vision and Mission
company established in January 2019. Woori Financial Group
The mission of Woori Financial Group is to become a ”Reliable Financial
oversees business management, which includes imposing busi-
Group Caring about Customers.” It aims to become a financial company
ness goals upon subsidiaries, approving business plans, deter-
that leads the industry by growing and developing alongside its cus-
mining matters concerning business performance evaluation
tomers, society and members of the Group. To this end, Woori Financial
and compensation, deciding on the corporate governance and
checking on the status of work and property. Woori Financial
Group also carries out subsequent funding, investment and fi-
nancing support for subsidiaries.
Group has selected the core values of “customer happiness, pioneering
for the future, honesty and trust and talent first.” With the highest prior-
ity placed on customer happiness, it will pioneer into shaping the future
and lead a healthy financial order, fulfilling the role as the finest employ-
ees in finance.
Management Policy
Management Plan and Strategy
The management policy of Woori Financial Group is, “Customers First,
The Group business goal for 2020 has been selected as, “Becoming
Field Management.” Woori Financial Group pledges to become a re-
the No.1 Financial Group through Customer Trust and Innovation.”
liable companion that stands alongside customers at all times, by ex-
To achieve this goal, it selected seven management strategies as fol-
panding customer-centric financial services and spreading a field-cen-
lows: a) Customer-Centric Business Innovation; b) Risk Management/
tric business culture. The vision of Woori Financial Group is “Korea’s
Internal Controls Innovation; c) Sustainable Growth Engine Reinforce-
No.1 Financial Group, Leading Global Finance”. It will make unwavering
ment; d) Business Portfolio Enhancement; e) Digital Innovation Lead-
endeavors under the mid-to-long term goal of leapfrogging into a
ership; f) Elevation of Global Business; and g) Woori Together Synergy
global leading group and becoming the No.1 comprehensive financial
Expansion.
group in Korea.
Woori Financial Group
first-level subsidiary
second-level subsidiary
11
14
100%
100%
59.83%
100%
100%
100%
100%
51%
73%
100%
100%
Woori
Bank
Woori
Card
Woori
Investment
Bank
Woori
FIS
Woori Finance
Research
Institute
Woori
Credit
Information
Woori
Fund
Service
Woori
Asset
Trust
Woori
Asset
Management
Woori
Private
Equity Asset
Management
Woori Global
Asset
Management
Korea BTL Infrastructure Fund
Woori America Bank
Woori Bank China Limited
PT Bank Woori Saudara Indonesia
AO Woori Bank (Russia)
Banco Woori Bank do Brazil S.A.
99.88%
100%
100%
79.88%
100%
100%
WB Finance Co., Ltd (Cambodia)
Woori Finance Myanmar
Woori Wealth Development Bank (Philippines)
Woori Bank Vietnam Limited
Woori Bank Europe Gmbh (Germany)
Woori Global Markets Asia Limited (Hong Kong)
100%
100%
51%
100%
100%
100%
Tutu
Finance-
WCI
Myanmar
Woori-
Hanwha
Eureka
Private
Equity Fund
100%
0.80%
History
Nov. 2018
Jan. 2019
Feb. 2019
Aug. 2019
Sep. 2019
Dec. 2019
Acquired the certifi-
cate of incorporation of
financial holding com-
pany from the Financial
Services Commission
Woori Financial Group
is established
Woori Financial Group
is listed on the Korea
Exchange
Woori Asset
Management Corp. is
incorporated as a
subsidiary
Woori Card Co., Ltd.
and Woori Investment
Bank Co., Ltd. are
incorporated as
subsidiaries
Woori Global Asset
Management Co., Ltd.
and Woori Asset Trust
Ltd. are incorporated as
subsidiaries
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Group Vision & Strategy
025
First, “Customer-Centric Business Innovation.” Woori Financial
Fourth, “Business Portfolio Enhancement.” Woori Financial Group
Group will firmly establish a customer-centric business culture by
will expand its business scope in core growth areas that include
improving performance evaluation to be conducive to grow with
consumer finance and capital market. It will also broaden product
customers and stronger consumer protection. In addition, it will im-
groups and operational competencies in the asset management
plement customer-oriented marketing by boosting customization to
business in order to make new subsidiaries more competitive. In
maximize customer value and involving a group of outside advisors
addition, it will utilize the real estate trust business to build a Group-
when developing new products. Furthermore, to establish a culture
wide system of collaboration in real estate finance.
of consumer protection, it will develop a pool of relevant experts and
innovate its organizational culture, thereby solidifying the foundation
for financial consumer protection.
Fifth, “Digital Innovation Leadership.” Woori Financial Group will
advance digital competitiveness by developing platforms in each busi-
ness area such as non face-to-face channels and real estate finance,
Second, “Risk Management/Internal Controls Innovation.” Woori
bolstering data utilization competencies and nurturing digital talents.
Financial Group expands the scope of risk management in every di-
rection by bolstering a system of cross-checking risks when pursuing
new business and reinforcing risk management of customer assets.
Furthermore, it will revamp its internal control system by innovating
relevant processes and systems.
Third, “Sustainable Growth Engine Reinforcement.” In order to
gain a competitive edge in newly growing businesses including CIB,
pension and asset management, it will bolster synergies among
Group affiliates and enhance the competitiveness of its products and
services. Woori Financial Group also optimizes its resources for busi-
ness management by considering profitability when pursuing busi-
ness and intensifying management of costs, with an aim to intensify
efficiency-driven business management.
Sixth, “Elevation of Global Business.” Woori Financial Group will
widen global business scope by expanding channels mainly in re-
gions with promising growth prospective and pushing forward joint
entry into overseas markets by Group affiliates.
Lastly, “Woori Together Synergy Expansion.” In order to expand
synergetic collaboration among different business areas, Woori
Financial Group will systematically discover tasks and develop them
into businesses in each core area. It will also broaden the achieve-
ments of synergetic businesses currently underway and continue to
discover new businesses.
In 2020, the entire Woori Financial Group will come together in making
utmost efforts to achieve the business goal of becoming the No. 1 com-
prehensive financial group through customer trust and innovation.
Shareholders Meeting
Board of Directors
CEO
Officer Candidate Recommendation Committee
Audit Committee
Risk Management Committee
Compensation Committee
Group CEO Candidate Recommendation Committee
Internal Control Management Committee
Secretary Department
Strategy
Planning
Unit
Finance
Planning
Unit
Consumer
Protection/
Management
Support Unit
Business
Management
Unit
Public
Relations &
Brand Unit
IT &
Digital Unit
Risk
Management
Unit
Compliance
Department
Strategy
Planning
Division
Finance
Planning
Division
New
Business
Division
Wealth
Management
Business
Division
Global
Business
Division
Corporate &
Investment
Banking
Business
Division
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Woori OverviewBusiness OperationsFinancial Review
026
SYNERGY CREATION
In January 2019, Woori Financial Group was established and
In early 2019, Woori Financial Group newly established the Synergy
new subsidiaries were subsequently incorporated under its
Team under the Strategy Planning Department of the Strategy Planning
jurisdiction, which expanded the base for Group synerg y.
Division under the Management Planning Main Business Unit. The Syn-
Collaboration among subsidiaries and creation of synergetic
businesses are flourishing in business units, under the goal
of boosting the competencies of the comprehensive financial
group. The holding company and all 11 subsidiaries participate
in the Synergy Council, which plans for new business and pur-
ergy Team is the matrix facilitator that will be involved in goal setting,
planning and evaluation under the seven Main Business Unit schemes
that was newly created, along with the inauguration of the holding com-
pany. The Synergy Team will hold ground and establish strategies as it
directs the synergy of all employees within the Group.
sues co-marketing to maximize synergy among Group subsid-
This organizational restructuring is not only expected to bolster re-
iaries and generate revenue, while simultaneously, seeking to
save costs.
sponsible business management and efficient decision-making to cre-
ate synergy among Group affiliates, but also to establish a collaborative
system among Group affiliates in preparation for business portfolio
expansion. Based on organic cooperation among group affiliates, new
business opportunities will be discovered and systematic, comprehen-
sive financial services will be provided to maximize its competencies in
2019 Performance
serving customers.
Woori Financial Group implemented a Main Business Unit scheme at
the Group level, that integrates and systematically manages the four
major growth engine businesses of WM, global, CIB and digital sectors
that previously operated at each Group affiliate level.
The WM Main Business Unit concentrates the competencies of the
asset management sector, bolstering competitiveness at the Group
level and performing the role of a control tower. The Global Main Busi-
ness Unit plans to carry out joint entry into overseas markets through
the help of Group affiliates and with the wider collaboration among
them. The CIB Main Business Unit will firmly establish the existing CIB
collaboration system between Woori Bank and Woori Investment Bank
as well as oversee the CIB business at the Group level. The Digital Main
Business Unit boosts the digital competency of the Group and focuses
on raising non-face-to-face channel competitiveness. This Unit will
operate the Dino Lab under the Digital Innovation Department which
is a program to support fintech, reinvigorating the nurturing of fintech
companies from the Group’s point of view.
Meanwhile, the Pension Planning Department has been newly estab-
lished to provide an impetus to the retirement pension business and
preemptively respond to the paradigm shift directed toward a greater
yield for customers. The Main Business Unit scheme will be solidified
in advance by preparing for the incorporation of securities and insur-
ance segments of the Group, which is planned for expansion, into the
retirement pension business. Furthermore, in order to bolster internal
controls and the risk management systems of Group affiliates and to
ensure consistency in policy implementation through anti-money laun-
dering (AML) surveillance, the AML Team was established under the
Compliance Support Department.
Woori Financial Group signs acquisition
agreement with Kukje Asset Trusts
2020 Woori Financial Group Business
Strategy Meeting
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Synergy Creation
027
2020 Plans
The holding company started in 2019, and this is when operational
systems for Group alliances were created and synergetic competencies
among subsidiaries were bolstered. Eleven subsidiaries discovered
and promoted a total of 28 allied businesses, for which they engaged in
cross-selling and joint sales efforts that led to both financial and non-fi-
nancial achievements.
In 2020, Woori Financial Group will enter the second stage of the Group
synergy roadmap to pursue “Full-Fledged Synergies (Greater Reve-
nue).” Synergy tasks will be systematically managed by: the “Group Syn-
ergy Council,” which is a meeting of executives; the “Synergy Working
Level Council,” a meeting of working level department heads; and unit
meetings, a working level meeting convened when deemed necessary.
The “Group Synergy Work Corner” and “Competition of Ideas on Group
Synergy” will be prepared to raise the level of interest among employ-
ees in creating alliances and to discover new businesses.
By operating abovementioned Group synergy systems, it will promote
the following core projects to make the leap forward in becoming the
No.1 financial group in Korea.
Second, Woori Financial Group will bolster non-banking competitive-
ness by managing the performance and supporting the growth of
newly acquired asset management companies. It will discover and pro-
mote joint businesses and marketing collaborations between Woori
Asset Management/Woori Global Asset Management and existing
subsidiaries. In particular, it will enhance the alliances created by new
subsidiaries through efforts such as sales collaboration with Woori
Bank.
Third, Woori Financial Group will raise the level of interest and partic-
ipation of its employees in creating synergy, in order to construct a
continuum of joint effort among the three main high-level units and
sales organizations. Business tasks derived from the three main units
will be segmented into each sales organization to be brought front and
center, while promising tasks discovered at sales organizations that re-
quire Group endeavors will be transferred up to the three main units to
be rolled out Group-wide. This, in turn, will foster the creation of more
continuous synergy.
Lastly, upon expanding its organization by incorporating new sub-
sidiaries through M&As with securities firms, insurers and savings
banks, Woori Financial Group will serve as a pivotal player in bolstering
First, the three main high-level units of Woori Financial Group (asset
collaboration and widening its market share in both the banking and
management, global, CIB) that centers around main subsidiaries –
non-banking sectors.
Woori Bank, Woori Card and Woori Investment Bank – will be the cen-
terpiece in maximizing performance with strategies to create synergy
and implementation of its businesses. It will also bring its joint busi-
nesses to the next level by facilitating communications among subsid-
iaries and coordinating their interests.
4 GROWTH ENGINE BUSINESS
Woori Financial Group Inc. established the Main Business Unit structure in order to systematically manage the four growth engine businesses at the
Group level. It will uncover new business opportunities and provide systematic and comprehensive financial services.
Woori
Financial
Group
WM
Global
CIB
Digital
Woori OverviewBusiness OperationsFinancial Review 028
DIGITAL INNOVATION
In the modern world, digital competencies have become a
Part 1. Customer-Centric Digital Channel Renewal
compelling core element of competitiveness amid the wider
In August 2019, Woori Bank revamped its previous “One Touch Retail
adoption of government policies in support of financial inno-
App” for mobile banking to “Woori WON Banking”, the new name
vation and rapid changes in the financing environment driven
indicating that Woori Bank (W) will turn on (ON) a new age of mobile
by fintech/big tech companies. Woori Financial Group is pre-
finance. Woori Financial Group plans to integrate and manage all mo-
bile brands throughout the Group under the brand identity of “WON.”
Woori WON Banking was developed after four months of customer
interviews and ex-ante usability tests, in order to clearly grasp consum-
er market demands. The results thereof were applied to the UX/UI of
WON Banking, in line with its three core concepts of “Clear”, “Fit” and
“Lead” to provide customers with: a simple screen layout and an easy-
to-use menu (Clear); customized notifications and simple transaction
linkages (Fit); and new financial products recommended by the Bank
for each customer (Lead). In step with increasing roles played by non-
face-to-face financial channels, Woori Bank will equip WON Banking
with greater user convenience and personalization, so as to develop it
as a leading marketing platform of Woori Financial Group.
emptively responding to changes in the financial environment
by developing innovative products and services through open-
ness and collaboration with outside parties and by bolstering
revenue-making competencies through solidified competitive-
ness in the main business of finance. To this end, it will adopt
agile processes based on swift decision-making and feedback
and expand the budget, workforce and organization necessary
to pursue digital business, thereby solidifying status as a lead-
ing digital financial company.
2019 Performance
In 2019, Woori Financial Group continued to promote the rebalancing
of its portfolio efforts that it had worked on in 2018, in order to respond
to the economic slowdown. With the global slowdown hampering eco-
nomic recovery in Korea, Woori Financial Group reorganized its assets
with a focus on promising sectors. Second, It worked on institutional
improvements to upgrade its risk management system. With stronger
regulations in place, it built new systems on par with global standards,
while upgrading existing systems to bolster risk management. In
addition, it enhanced contingency plan and nation-by-nation risk man-
agement scheme, reinforcing the Bank’s crisis management capacity.
Third, it overhauled credit evaluation models to fine-tune credit risk
management and acquired approval from the Financial Supervisory
Service (FSS). The credit evaluation models are kept current and re-
newed regularly every five years.
Digital Innovation Committee
• Chairman: (CEO) Woori Financial Group
• Members: (CEO) Woori Bank / Woori Card /
Woori Investment Bank / Woori FIS
(Head) Strategy Planning Division /
IT&Digital Unit, Woori Financial Group
Digital Innovation Unit
• Unit Head: (CEO) Woori Bank
Innovation Team (Blue Team)
Working Group (Organizer) - Head of IT&Digital Unit
Woori Financial Group
Woori Bank
Woori Card
Woori Investment Bank
Woori FIS
IT&Digital Unit
Digital Banking Business Group
Digital Group
Management Support Division
IT&Digital Unit
Strategy Planning Division
Management & Finance Planning Group
Management Planning Division
Management Planning Division
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Digital Innovation
029
Part 2. Reinforcing Digital Marketing and Expanding
External Collaboration
In 2019, Woori Bank promoted differentiated digital marketing and
multi-dimensional collaborations with outside parties, under the goal
of bolstering its development and marketing competencies based
on open finance. Woori Bank is reinforcing digital direct marketing by
working with outside platform companies and payment service provid-
ers at home and abroad that have a wide customer base, in response
to declining branch traffic. It is also seeking to co-develop affiliated
products and services with tech giants and major fintech companies,
including Samsung Pay and Bank Salad.
2020 Plans
In 2020, customer-centric changes in the financial environment are ex-
pected to intensify as government policies for financial innovation such
as revitalization of open banking and the amendment of the three parts
of data-related legislations become more tangible. In addition, sub-
sequent innovative services launched by fintech companies and tech
giants are expected to fuel ever-fiercer competition among financial
groups as well as between financial groups and fintech/big tech com-
panies. Woori Bank plans to implement major digital projects under the
goals of: a) reinforcing digitally-driven competitiveness in the main line
of business finance, by boosting total revenue through non-face-to-
In addition, Woori Bank promoted the development/advancement of
face deposits and loans and by expanding non-interest income; and b)
open banking services in response to the introduction of open bank-
scaling out digitalization throughout all sectors of finance. In particular,
ing services by the Korea Financial Telecommunications & Clearings
Woori Bank will expand its digital business coverage by taking such ac-
Institute in December 2019. Preparing for a full opening of its face-to-
tion as promoting the digitalization in the inherent areas of finance that
face channels, it also bolstered marketing to revitalize open banking by
fintech/large tech companies cannot easily replicate, such as corporate
developing specialized products and services.
finance and asset management.
Furthermore, Woori Bank opened Dinno Lab in April 2019 – a test bed
center that provides fintech companies with a development environ-
ment and tech coaching services free-of-charge and intensive support
for technological development. In June, Woori Bank built an open API
platform, thereby creating a collaborative environment to work with
outside fintech companies and laying the foundation to develop digital
business models with promising companies.
Part 3. Supporting Business with New Digital
Technologies and Reinforcing Customer Experience
In June 2019, Woori Bank introduced RPA (Robotic Process Automation),
seeking to improve administrative work within the Bank and boost
productivity by revamping the way it works while reducing human
error and supporting business activities. A total of 32 RPA tasks were
selected in 2019 and are currently under development. In 2020, Woori
Bank plans to add more automation tasks, while pressing ahead with
quality enhancement by internalizing sophisticated technologies. In
addition, Woori Bank adopted an e-document system throughout its
branches, which remarkably cut down customer wait times and expe-
dited the work handled by employees. Woori Bank also pursued further
digital business innovations such as refined marketing endeavors that
use models to recommend customized products and innovations that
revitalize customer transactions, that were developed from boosted
competencies in Big Data analysis.
In addition, it will boost digital marketing by raising non-face-to-face
accessibility to financial products for customers, developing loan and
deposit products exclusively available on non-face-to-face channels
and revitalizing F/X and fund sales. Woori Bank will also upgrade mobile
banking app services and advance its UX/UI 24/7.
Furthermore, Woori Bank will apply AI technologies to main financing
businesses including sales/marketing, risk management, customer
services and infrastructure, in order to build a genuine AI-powered
bank system. To this end, Woori Bank plans to develop services avail-
able to customers, branches and head offices alike, based on AI-driven
financial market outlooks. Woori Bank will also introduce Reg Tech to
customer protection and internal control, which are its strong points. In
addition, it will utilize real-time voice recognition to develop intelligent
chat-bot services that provide consulting for customers and adopt a
service platform based on AI and Big Data by introducing the first in-
house comprehensive cloud among Korean banks.
In an environment where financial digitalization has been acutely ac-
celerated by COVID-19, Woori Financial Group has driven forward the
“digital first” strategy by fully realigning its Group vision and business
management slogans, while newly establishing a control center dedi-
cated to digital strategies. In fact, the vision, “Digital for Better Life”, was
just recently declared as the Group’s digital goal going forward and it
has established the “Digital Innovation Committee”, led together by
Chairman Son, Tae Seung and Woori Bank CEO Kwon, Kwang Seok, to
oversee operations.
Woori OverviewBusiness OperationsFinancial Review 030
GLOBAL BUSINESS
In 2019, Woori Bank achieved internally robust growth by ex-
Bank realized a net income of USD 192 million, up 9.3 percent
panding networks mainly in Southeast Asia – a region of high
YoY. Woori Bank also boosted global digital competencies by
growth potential and profitability – and by devising local-
expanding locally-customized digital financial services and
ly-customized business strategies and building differentiated
tablet branches in strategic retail branches in regions includ-
non-face-to-face channels Woori Bank bolstered local retail
ing Bangladesh, China and Vietnam, through collaboration
business infrastructure to 451 – the largest among Korean
with other industrial sectors such as retail fintech. In step with
banks – by scaling out business channels where growth is
the global trend of reinforcing compliance, Woori Bank bol-
promising: namely, Vietnam, Cambodia, Myanmar, Indonesia,
stered internal control system such as AML and its specialized
etc. In addition to building a global network, Woori Bank also
workforce, building a solid business system for the sustainable
continued to pursue the qualitative growth of its asset portfo-
growth of global business.
lio with a focus on reliably profitable assets. As a result, Woori
2019 in Review
Net Profit
KRW 224 million
(up 15.8% y-o-y)
NPL Ratio
0.54%
Liquidity Ratio
116.1%
(up 5.6% y-o-y)
Woori Finance Myanmar
Tutu Finance-WCI Myanmar
Woori Bank China Limited
Main Focus Countries
·Indonesia ·Vietnam ·Philippines ·India
·Bangladesh ·Cambodia ·Myanmar
Woori Global Markets Asia
Limited (Hong Kong)
AO Woori Bank (Russia)
Poland
London
Gurgaon
SEOUL
Tokyo
Bahrain
Dubai
Dhaka
Mumbai
Hong Kong
Yangon
Chennai
Kuala Lumpur
Singapore
Woori Wealth Development
Bank (Philippines)
Woori America
Bank
New York
Los Angeles
Banco Woori
Bank do Brazil
S.A.
Woori Bank Europe Gmbh
(Germany)
WB Finance Co., Ltd.
(Cambodia)
PT Bank Woori
Saudara
Indonesia
Sydney
Woori Bank Vietnam Limited
Group Global Network
476 total networks
(As of March 31, 2020)
12
Overseas
subsidiaries
14
Overseas
branches
8
Overseas
subbranches
5
Representative
offices
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Global Business
031
2019 Performance
Expanding the Global Network
Woori Bank started to go global by opening its first overseas branch in
November 1968 in Tokyo, becoming the first Korean commercial bank
to do so. Since then, its interest in international markets has remained
active. In 2014, Woori Bank became the 1st Korean bank to acquire
a bank listed overseas (in Indonesia), subsequently launching Woori
Saudara Bank. In 2016, Woori Bank acquired a local savings bank in
Building a Relationship with Global Banks
Woori Bank is leading the way in providing financial support for Korean
companies with an overseas presence and with local blue chip compa-
nies by securing stable credit lines through cooperation with global-
ly-renowned banks. Woori Bank is also contributing to the revitalization
of export-import transactions among global companies by engaging
in various means of trade finance including foreign bills purchase, L/C
transactions such as banker’s usance and payment guarantees.
the Philippines, and Woori Bank is in the process of expanding synergy
Intensifying Compliance and Internal Controls
by collaborating with its partner, the Vicsal Group. In June 2018, Woori
In line with the stricter compliance requirements of financial authori-
Bank acquired WB Finance, a savings bank in Cambodia, expanding
ties around the world, Woori Bank upgraded AML/sanctions filtering
business coverage throughout Cambodia. It also launched Woori Bank
system and realigned its work manual after collaborating with a con-
Europe in Germany in November 2018, paving the way for entry into the
sulting firm to diagnose current compliance status at its domestic and
European market. In 2019, Woori Bank opened five branches in Viet-
overseas branches. Woori Bank also boosted competencies in global
nam including Ha Nam, Da Nang and Vinh Phuc, accelerating localized
compliance by holding weekly ‘Global Compliance Working-Level Com-
business. It also continued to seek organic growth in Bangladesh and
mittee’ meetings which invited relevant departments from the head
Myanmar. Through these efforts, Woori Bank built a global network
office to share ideas on improvement suggestions and review support
of 451 branches, the largest among Korean banks. In June, it acquired
provided by the head office. Woori Bank is also striving to bolster ex-
the approval for merging two local subsidiaries in Cambodia – Woori
pertise by training compliance personnel with both in-house programs
Cambodia Finance and WB Finance – thereby laying a springboard to
and those that are outsourced to specialized external institutions.
become a local financial leader. These initiatives demonstrate its overall
achievement in the qualitative growth of global network.
Securing the Drive for Sustainable Growth of the
Global Business
To secure the drive for the sustainable growth of global business, Woori
Bank pursued internally robust growth with a focus on high-yield core
assets. To this end, it reinforced business competencies with a two-track
strategy based on different economic and financial environments where
it has presence: localization in emerging markets and CIB business-driv-
en approaches in developed markets. In emerging markets, local sub-
sidiaries reinforced market dominance through proactive localization
strategies such as introducing special product line-ups for local retail
customers. In advanced economies, Woori Bank focused on reinforcing
competitiveness in corporate finance such as IB and FX businesses.
2020 Plans
In 2020, the Global Business Group plans to carry out balanced and
stable growth through customer-centric marketing and business in-
novation. Woori Bank will build a growth model based on partnerships
with customers through specialized business, targeting core custom-
ers at each branch. Woori Bank will also reinforce localized business
by developing a variety of customer-tailored products and services.
In the Southeast Asian regions of promising growth potential, Woori
Bank will seek internally robust quantitative and qualitative growth of
global network through organic growth and strategies to secure core
retail hubs by integrating or relocating existing branches. In Cambodia,
Woori Bank will maximize synergy by completing the merger of its two
subsidiaries and fully launching the integrated business. Woori Bank
Boosting the Global Digital Business Infrastructure
will elevate digital platform by completing the global mobile banking
To respond to changes in the global financial environment and to lead
the trend, Woori Bank is continuing to bolster competitiveness in non-
face-to-face business channels. It revitalized the ODS business by
expanding tablet branches in Indonesia. Woori Bank also enhanced
customer convenience by adding payment services such as QR Pay via
mobile banking in Vietnam and Cambodia. Furthermore, alliances with
other industrial sectors such as local fintech thrived, expanding its local
retail business based on non-face-to-face channels that offer exclusive
products: Woori Bank aligned with Financial OneConnect in China to
offer online auto loans; and for Grab drivers in Cambodia, Woori Bank
offered exclusive automobile/motorbike purchasing loans.
renewal project in H1, currently underway to reinforce global digital
competencies. Based on this project, Woori Bank will hasten digital
transformation by expanding business in mobile-only credit loans and
deposit products, non-face-to-face international money transfer and
payment services. Going forward, Woori Bank will respond to global
economic uncertainties with systematic risk management and build an
internal control system that meets global standards by meticulously
managing work processes, thereby becoming a leading bank in Asia.
Woori OverviewBusiness OperationsFinancial Review 032
RISK MANAGEMENT
The US-China trade conflict that began in 2018 has slowed
Portfolio Rebalancing
global economic growth and has caused a significant impact
Woori Bank has rebalanced its portfolio as part of the strategy to min-
on the Korean economy whose trade is heavily reliant on the
imize impact from the economic downturn since 2018. With Korea’s
two nations. As a result, a trend of low growth in the 2 percent
exports in decline, corporate financial soundness is expected to only
range per annum continues in Korea. In addition, sluggish do-
get worse. As such, Woori Bank applied varied exposure thresholds
mestic demand has put sole proprietors in peril and has pushed
up loans. Outstanding household loans set a new record each
year. If this situation continues, uncollectable debt will surge,
which will undermine the asset soundness of banks, pushing up
bad debt expenses and bringing down capital adequacy ratios.
Woori Financial Group is at the crossroads of a pivotal moment
when risk management takes on more importance than ever
before. Woori Bank is aware that risk management must take
by predicting growth rates in accordance with the industrial outlook,
in order to induce its assets to grow in promising sectors. For assets in
sectors that are growing too quickly such as in real estate leasing, Woori
Bank took restrictive measures to pace that growth. As a result, asset
soundness improved to an NPL ratio of 0.4 percent by the end of 2019.
Improving the Risk Management System
and Institutions
Supervisory authorities at home and abroad implement a wide range
priority and is bolstering its system in a continuous endeavor
of regulations in regard to risk management, affecting a number of sys-
to become a steadfast and sustainable financial enterprise, a
tems. Whenever regulations are revised, systems need to be upgraded
bulwark against external shock.
accordingly. In 2019, Woori Bank enhanced its ALM system in line with
2019 Performance
IRRBB (interest rate risk in the banking book) and built a derivatives
evaluation and verification process in step with stronger regulations on
derivatives. Woori Bank also developed a CSA (credit support annex)
In 2019, Woori Financial Group continued to promote the rebalancing
collateral management system.
of its portfolio efforts that it had worked on in 2018, in order to respond
In addition, Woori Bank bolstered risk management by developing and
to the economic slowdown. With the global slowdown hampering eco-
implementing risk management systems or building upon the existing
nomic recovery in Korea, it reorganized assets with a focus on promis-
ones including the IB yield analysis system, the corporate early-warn-
ing sectors.
ing system and the BIS ratio calculation system.
Second, Woori Financial Group worked on institutional improvements
Meanwhile, Big Eye, the first Big Data-based corporate client analysis
to upgrade risk management system. With stronger regulations in
system developed by a bank in Korea, is utilizing a wider range of data
place, Woori Financial Group built new systems on par with global stan-
and is expanding its coverage in doing so. Woori Bank is also develop-
dards, while upgrading existing systems to bolster risk management.
ing a corporate bad debt detection system that will issue warning sig-
In addition, Woori Financial Group enhanced contingency plan and na-
nals after analyzing the bad debt patterns of companies.
tion-by-nation risk management scheme, reinforcing the Bank’s crisis
management capacity.
Third, Woori Financial Group overhauled credit evaluation models to
fine-tune credit risk management and acquired approval from the Fi-
NPL Ratio (Group)
nancial Supervisory Service (FSS). The credit evaluation models are kept
current and renewed regularly every five years.
1.48%
0.99%
0.85%
-0.09%p
0.54%
0.45%
2015
2016
2017
2018
2019
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Risk Management
033
On the institutional front, Woori Bank overhauled contingency plan to
2020 Plans
prevent any crisis in the financial market from permeating the Bank.
Woori Bank resets monitoring indicators and triggers to better per-
Woori Bank’s two major projects of 2020.
ceive signs of crises, while inspecting and complementing action plan
First project is regarding emerging risk management.
by level of risk, enabling to respond effectively. In addition, Woori Bank
aligned risk levels with those applied to the contingency plan of the
holding company, ensuring consistency with the crisis management
systems of the holding company and the Bank.
Emerging risk refers to an upsurge in a risk that accompanies the dra-
matic growth of an asset. For example, as Woori Bank expanded global
businesses in a bid to secure new income sources, its global assets and
IB Business Group assets grew significantly. In addition, the increasing
Lastly, Woori Bank improved nation-by-nation risk management
demand for hedging against fluctuations in interest rates and f/x rates
scheme. Previously, Banks had only imposed credit ceilings on a nation-
has increased derivative transactions, while the growth of non-face-
al basis. However, in consideration of the risk that a national crisis could
to-face transactions have accelerated the rise in digital and/or remote
potentially have on nearby regions, Woori Bank recently established
loans. Such fast-growing assets entail fast-growing risks that require
credit thresholds at the regional level.
intensive management.
Enhancing the Credit Evaluation Model
Woori Bank operates two credit evaluation models: one for corporate
borrowers and another for retail borrowers. The credit evaluation mod-
els calculate the expected default rate of the borrower and evaluate
their credit ratings. In 2019, Woori Bank enhanced both the retail and
corporate models by incorporating the latest data and obtained the FSS
approval.
In order to reinforce the management of emerging risks, Woori Bank
will widen its scope of monitored assets at overseas branches and
in the IB Business Group. Woori Bank will conduct inspections on a
regular basis and report findings to the management. Thresholds on
transactions in derivatives will be managed more intensively and man-
agement system of derivatives transaction counterparties will be en-
hanced. For non-face-to-face loans, Woori Bank will analyze the inher-
ent risks of borrowers and flexibly operate lending approval strategies.
The revamped corporate credit evaluation model reflected the charac-
teristics of SOHO loans that have recently been growing in Woori Bank’s
Next, bolstering credit risk management.
portfolio with a lower default rate compared to corporate clients. The
With the slowing global economy dampening exports, corporate per-
new model also refined credit evaluation by adding sharply defined
formance is projected to decline. Global credit rating companies are
financial indicators. The retail credit evaluation model enhanced pre-
presenting negative outlooks for Korean companies and with no sign
cision by segmenting its system of pools, or groups that display similar
of an economic recovery, Korean companies may be downgraded en
risk characteristics. Woori Bank also newly developed a model dedi-
masse. Furthermore, household loans also need to be managed due to
cated to micro-financing and another to non-face-to-face channels, in
the high delinquency rate of borrowers with mid-to-low credit ratings.
response to the growing loans extended to borrowers with mid-to-low
credit ratings.
Intensive management of the high-risk group is needed to prepare
against surging risks involving corporate and household loans. As
These improvements to credit evaluation models enabled Woori Bank
such, Woori Bank will check on borrowers that are on the performing/
to measure the credit risk of borrowers more meticulously. By imposing
non-performing borderline. Woori Bank will also review the criteria for
adequate credit ratings and preventing bad debt, the new models are
handling loan products. and also devise a separate set of management
expected to contribute to greater asset soundness.
measures for high-risk borrowers and high delinquency rate products,
in order to minimize their impact on soundness. Furthermore, Woori
Bank will act preemptively to prevent bad debt by conducting pinpoint
loan reviews on sectors or regions showing a growth in risk.
Woori OverviewBusiness OperationsFinancial Review 034
SOCIAL RESPONSIBILITY
Woori Financial Group’s
Social Contribution
Inclusive Finance
Strategies & Characteristics
Support for microfinance
Woori Financial Group engages local communities in social contribu-
Woori Bank provides wide-ranging support for microfinance, in order
tion activities to realize the value of the vision, “Benefit from Finance,
to continue realizing the social value of finance by lifting the burden of
Warmth from Sharing.” Love for People, Pursuit of Happiness and Ful-
financial costs for ordinary citizens and to grow alongside them. With
fillment of Hope are the three core values it aims to achieve under the
its notable microcredit product, “New Hope Spore Loan,” Woori Bank
slogan, “Better Together.” Specific activities include fostering the future
handled KRW 615.6 billion at the end of 2019. Also, non-face-to-face
generation, supporting the underprivileged, spreading the spirit of
channels have been opened since April 2019, providing active support
philanthropy and protecting the environment. Woori Financial Group
to the financially marginalized who find it difficult to visit branches. In
will continue to carry out social contribution actives that society truly
addition, in September 2019, Woori Bank launched “Sunshine Loan 17”
needs, thereby generating social value.
as part of the government policies to support microfinancing. “Sun-
Vision
Benefit from Finance, Warmth from Sharing
shine Loan 17” is extended to borrowers who earn an income but are
held back by their low credit rating from accessing first-tier financial
services. Previously, these borrowers could only resort to going to
second-tier financial institutions or loan sharks, but “Sunshine Loan 17”
allows them entry into first-tier financial services. As of the end of 2019,
KRW 24.1 billion of “Sunshine Loan 17” was extended to around 3,060
financially vulnerable borrowers. Meanwhile, Woori Bank selected
Core Value
Humanity
Happiness
Hopefulness
branches that demonstrate a high demand for microcredit as “Woori
Characteristics
Hope Finance Plaza” and presented asset management and debt re-
structuring services to ordinary citizens.
Furthermore, Woori Bank contributed KRW 1.257 billion in 2019 to the
Korea Inclusive Finance Agency, in support of the microfinancing prod-
CSR strategies aligned with
SDGs, aimed to manage business
sustainably and create social value
CSR strategies with five key words
to be “Better Together”
uct, “Sunshine Loans for University Students and Young People.” This
contribution is used to provide guarantee when refinancing the loans
1 Inclusive finance
Facilitating continuous,
inclusive and sustainable
economic growth,
creating jobs
2 Fostering the future
generation
Guaranteeing inclusive,
equitable and decent
education, promoting
lifelong learning
opportunities
3 Supporting the
underprivileged
Reducing inequality
between and within
nations, contributing to
social integration
4 Spreading the mecenat
spirit of philanthropy
Spreading cultural value by
sponsoring Korean arts,
culture and sports
5 Protecting the
environment:
Responding to climate
change, protecting and
restoring a sustainable
ecosystem
extended to youths and university students to lower interest rates.
Support for SMEs and SOHOs
Woori Bank became the first financial institution to initiate consulting ser-
vices for SMEs (SOHOs) in 2001. Today, experts including certified accoun-
tants and tax accountants at the Bank provide SMEs and SOHOs custom-
ized consulting services across-the-board, from business management
and finance to tax issues. In 2019, with an aim to intensify support for start-
ups by small merchants, Woori Bank established Woori Support Centers
for Small Merchants in Seoul/Gyeonggi (Jongro, Myeong-dong, Eunpyeo-
ng, Pangyo) and provincial areas (Busan), where consulting programs are
run for promising start-ups.
Woori New Hope Spore Loan
(Unit : KRW in trillions)
2017
2018
2019
*Accumulated
2.11
2.63
3.33
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Social Responsibility
035
Fostering
the Future Generation
Supporting
the Underprivileged
Woori FIS Project to Foster
Future IT Talents
Social Contribution Campaigns
of Woori Financial Group
Woori FIS provides easy and fun programming language education for
Woori Financial Group conducted a Group-wide CSR campaign in Feb-
marginalized children and youth. In addition, Woori FIS selects 70 un-
ruary 2019 with domestic and global subsidiaries and branches in 26
derprivileged students from specialized (vocational) high schools and
nations, under the topic, “Good Together!”.
provides them with scholarships. In-house IT experts also volunteer
for mentoring programs, offering opportunities to students to develop
their career and cultivate expertise.
1 Company 1 School Financial Education
Since 2015, Woori Bank has been taking part in the “1 Company 1
School” Financial Education campaign as one of the initiatives of the
“Top 20 Financial Custom Reform Project” by the Financial Superviso-
A total of 22 overseas networks in nations such as the US, China, Cam-
bodia, Brazil and India mobilized 317 employees to CSR activities tai-
lored to local needs. These needs included initiatives such as the sup-
port for the disabled and the marginalized, environmental clean-ups
and the improvement of educational facilities. In Korea, 721 employees
from 64 branches altruistically helped their neighbors in need and do-
nated KRW 115.4 million to social welfare organizations.
ry Service, striving to enhance public understanding and raise aware-
In October 2019, second-half of CSR campaign was carried out with
ness regarding sound financial practices. All nationwide branches of
1,144 employees from 97 branches at home and abroad, providing
Woori Bank have agreements with elementary, middle or high schools
moral support, hosting cultural sharing events and donating daily ne-
and are providing financial education in ways suitable to each region
cessities for underprivileged elderly citizens, persons with disabilities
and school, including through outreach education, field trips to bank
and children at social welfare facilities and community children’s cen-
branches and mobile branch education. In 2019, the Bank concluded
ters. Furthermore, Woori Financial Group donated KRW 147.874 million
agreements with 489 schools and provided 112 sessions of financial ed-
to social welfare facilities in vulnerable communities, directly contribut-
ucation to a total of 7,464 students.
ing to the reduction of inequality among local communities by support-
ing daily life, improving welfare and sharing cultural benefits. Woori
Financial Group will continue its support projects in 2020, developing
alongside communities through proactive CSR activities and sharing
with neighbors.
Woori FIS Aid for children with cancer and
their rehabilitation treatment
Woori Bank Support to invite children
from rural areas to Seoul
Woori Financial Group produced and distributed Woori
Hope Boxes (daily necessities) for the underprivileged
Woori OverviewBusiness OperationsFinancial Review 036
Spreading
the Mecenat Activity
Protecting
the Environment
Healing Concert for Youths
Woori Bank has been running the “Healing Concert for Youths” project
Environmental protection
campaign: “Woori Protects the Earth”
since 2018, sending an orchestra to perform classical music at schools
In order to entrench a culture of eco-friendliness within the Bank and
for children who have little opportunity to come across such music.
facilitate eco-friendly business management, Woori Bank conducted
The Healing Concerts are a part of its culture and arts project to raise
a bank-wide environmental protection campaign in July and August
awareness of disabilities and inequality among future generation by
2019 entitled, “Woori Protects the Earth.” During the campaign period,
presenting collaborative works of disabled and non-disabled perform-
12,893 employees of Woori Bank joined the commitment to green
ers. More than 7,000 students in 12 schools attended its concerts in
action and refrained from using disposable paper cups, consequently
2019, and from it, became more aware of disabilities and enhanced
using 116,000 fewer paper cups than the year before. Employees also
their musical appreciation.
Woori, Warm Voices
saved energy by shutting off the power of their office equipment before
going home. In addition, employees collected 342 reusable shopping
bags and donated them to traditional markets in a bid to reduce the
For visually impaired children placed in the blind spots of culture, Woori
use of disposable plastic bags. Also, an AI-driven recyclable resource
Bank implemented the “Woori, Warm Voices” campaign. The Bank
recovery robot was installed in the head office building of the Bank,
produced 340 high-quality audiobook CDs with the participation of
spreading the culture of recycling. Through all these efforts, Woori
professional voice actors and donated them to schools for the blind and
Bank led the way in protecting the environment by engaging in various
e-libraries, along with 120 CD/MP3 players that can play the audiobooks,
eco-friendly activities as part of daily life.
thereby promoting cultural life and learning opportunities for visually
impaired children. Woori Bank will continue to undertake projects to
“Woori Finance Forest of Life” Project
provide cultural and learning support for visually impaired children, in
Woori Bank engaged in forestation endeavors to bring back the school
order to raise the level of social interest in persons with visual disabilities.
forest of Inheung Elementary School in Goseong – one of the areas that
fell victim to the wildfire that swept the Gangwon Province. The Bank
donated KRW 200 million to the school and carried out a forestation
project called, “Woori Finance Forest of Life,” in order to revitalize the
natural environment of the community. During the forestation peri-
od that spanned six months from June 2019, 130 tall trees and 3,360
shrubs were planted in an area of 700m2 to restore the ecosystem dam-
aged by the fire. The newly planted species were mainly indigenous or
capable of mitigating wildfires. A resting area and forest playground
were also created, turning the lively forest into a harmonious place of
education for nature and repose for residents.
Healing Concert for Youths
Woori, Warm Voices
Woori Protects the Earth
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Social Responsibility
037
Woori Multicultural
Scholarship Foundation and
Its Main Project
Woori Multicultural Scholarship Foundation
Furthermore, the Foundation deploys a number of culture and welfare
In 2012, Woori Financial Group contributed KRW 20 billion and estab-
support projects for the stable settlement and thriving lives of multicul-
lished the Woori Multicultural Scholarship Foundation. As the first of its
tural families, including projects to enhance study room environments
kind in the financial sector, the Woori Multicultural Scholarship Founda-
for multicultural children, supportive programs for the cultural life of
tion is leading the way in supporting the healthy growth of multicultural
multicultural families and outstanding multicultural programs.
children and the stable settlement of multicultural families in Korean
society.
Scholarship Program for Multicultural Children
In 2019, Woori Multicultural Scholarship Foundation selected 400 stu-
dents for scholarships of KRW 626 million. In addition, the Foundation
provides scholarships for multicultural students with special skills in
sports, linguistics, etc., so that they may further enhance their talents.
This scholarship is available for receiving education and training, ac-
quiring qualifications and covering expenses for participating in com-
petitions.
The Foundation’s scholarship recipients in universities have formed the
“Woori Nuri” supporters group, which meets each month. Scholarship
students engage in a variety of programs including volunteer activities
and team projects that produce videos about songs they wrote to raise
awareness of multiculturalism, novels on related topics and compari-
son of different food and cultures.
Culture and Welfare Support Projects for
Multicultural Families
Woori Multicultural Scholarship Foundation hosts a joint wedding cer-
emony for multicultural couples who are unable to afford a wedding. In
2019, the Foundation sponsored the entire wedding ceremony, includ-
ing the wedding reception and honeymoon, for 10 multicultural cou-
ples. This is helping multicultural families to firmly establish themselves
as active members in Korean society.
During the summer vacation, a group consisting of multicultural chil-
dren in middle and high schools, as well as scholarship students from
universities, embarked on a trip to experience global culture. The group
visited Singapore – one of the most multicultural and multiracial na-
tions in the world and experienced its history, culture and ecosystem.
The group also visited the Singapore branch of Woori Bank and the Na-
tional University of Singapore and communicated cross culturally with
local students.
Supporting the Scholarship for Children
from Multicultural Families
Supporting the Culture and Welfare of
Multicultural Families
Supporting Excellent Programs for
Multicultural Families
Woori OverviewBusiness OperationsFinancial Review 038
S P E C I A L I S S U E
Woori Financial Group is
doing its best to respond
to COVID -19
While COVID-19 has swept the world with devastation and has offi-
cially been declared a global pandemic, Korea’s response to the
virus has been hailed as an exemplary model throughout the world.
As COVID-19 threw the world into a “mobility crisis,” Korea’s efforts
to prevent the infection have widely been praised for its success in
quickly and methodically calling to arms the power, intellect and
resources of an open democracy. Even amid the peak of the outbreak,
Korea’s measures never called for the closing of borders, let alone
restricting domestic mobility. Such openness and well-devised pre-
vention measures have been applauded for their pan-governmental
approach, legislative and administrative systems and flexibility in pol-
icy flexibility.
Woori Financial Group
Maintains Solid Fundamentals with
Swift Response to COVID-19
After a sober analysis of the economic turmoil and impact that
COVID-19 may bring, Woori Financial Group established a Commit-
tee for Emergency Measures for Business Management to serve as
the control tower of the Group in managing this crisis. The Commit-
tee devises measures to respond to the crisis Group-wide, boost cus-
tomer support and add momentum to national efforts to overcome
the crisis. Furthermore, with volatility in the global financial market
growing dramatically more volatile, the Committee quickly inspected
Woori Financial Group is making all-out efforts of its own to help con-
domestic and overseas fund assets and initiated monitoring efforts
tain the spread of COVID-19. Woori Financial Group is offering not only
to activate the FX contingency plan if needed. In the post-COVID-19
financial support to SMEs and small merchants, but also various activi-
world, the Committee plans to review a host of scenarios to prepare
ties to share with local communities. To this end, Woori Financial Group
for even the most extreme crisis situations, adjust and manage busi-
strives to minimize the economic toll of the virus on customers and to
ness goals, actively cooperate with financial authorities and make
fulfill social responsibilities as a financial group.
policy suggestions and seek various measures to support customers.
Relief kits for the
vulnerable
The Chairman presides over an emergency meeting with subsidiary CEOs
Lunch boxes for
medical staff
Financial difficulties
counseling
Global Goods Support
(Indonesia - Protective clothing
and disinfectants)
WOORI FINANCIAL GROUP ANNUAL REPORT 20191 Special Issue
039
Anseong Training Center was
offered as a COVID-19 daily
treatment center
Click! Woori Together Cloud
Funding for the underprivileged
in the face of COVID-19
Woori Financial Group delivers hand-
made meal boxes to Daegu healthcare
providers swamped by COVID-19
Fulfilling Social
Responsibility as a Financial
Group and Implementing
Support Projects
Woori Financial Group has launched wide-ranging support projects since the early stages of the
pandemic, standing alongside the people of Korea to overcome the hardship together. In order
to surmount this national crisis, Woori Financial Group will not only provide financial support as a
financial institution, but fully mobilize all available resources at the Group level to fully carry out
social responsibility.
Financial Support
Non-Financial Support
• Distributed Onnuri gift certificates (useable at traditional markets)
• Distributed Onnuri gift certificates (useable at traditional markets)
to employees as a means to reinvigorate the markets
to employees as a means to reinvigorate the markets
• Extended consignment guarantee agreement loans under the
second government program for small merchants
• Provided extension on maturity and grace periods on interest
rates for loans secured by a letter of guarantee
• Operated counseling windows throughout all branches to assist
customers with financial difficulties triggered by COVID-19
• Provided extensions on maturity and grace periods on interest
rates for loans to companies impacted by COVID-19
• Extended interest-subsidized loans with ultra-low interest rates
for small merchants
• Woori Multicultural Scholarship Foundation selected 430 student
recipients: For both multicultural minority children in primary and
secondary schools and/or for children whose parents’ business
suffered profit losses due to COVID-19
• Extended the “Energy Lunch Box” project for healthcare providers
in Daegu (until May 14)
• Opened up the Anseong Training Center to serve as a daily
treatment center
• Donated 5,000 hazmat suits to Indonesia
• Joined the “Good Landlord Campaign”
• Provided grace periods on credit card billing; lowered interest
• Provided food items to the underprivileged in the Daegu-Gyeongbuk
rates and provided grace periods on the repayment of card loans
region
• Offered Woori Card emergency livelihood loans
• Opened ad hoc market to help farmers impacted by COVID-19
• Lowered or exempted delinquency interests; deleted delinquency
• Installed protective acrylic screens at branches to protect
records
customers from infection
• Shortened the deposit cycle for merchant accounts
• Utilized the crowd funding platform, “Click! Woori Together” to
• Provided grace period on loan repayments and exempted
delinquency interests for companies impacted by COVID-19
donate relief funds
• Provided masks to a social welfare center in Mapo-gu, Seoul
• Provided Personal Protective Equipment (PPE) items to customers
• Provided respiratory disease prevention kits to marginalized families
• Installed protective acrylic screens at branches to protect custom-
ers from infection
• Donated Personal Protective Equipment (PPE): 10,000 dental masks,
100 bottles of hand sanitizer
Woori OverviewBusiness OperationsFinancial Review23 BUSINESS
OPERATIONS
With the 4th industrial revolution
underway, the market conditions
are changing and evolving rapidly.
Woori Bank will lead this new era,
turning challenges into opportunities,
diversifying its revenue sources and
achieving stable growth.
Woori Bank will make sure to repay
their trust with bigger profits and
enhanced levels of satisfaction.
Reliable Financial Services
through Balanced Growth
(Unit : Thousands Persons)
23,507
Total Customers of Retail Banking
1,032
No. of Foreign Customers
1,660
No. of SOHO & SME Customers
Loans in Won (Bank)
(Unit : KRW in trillions)
+4.3 %
211
220
200
2017
2018
2019
Woori Bank
Woori Card
Woori Investment Bank
042
072
074
Woori Fund Services
Woori Asset Trust
Woori Asset Management
Woori Finance Information System
076
Woori PE
080
081
083
085
Woori Finance Research Institute
Woori Credit Information
077
078
Woori Global Asset Management
087
042
WOORI
BANK
Digital
Innovation
Woori Bank has consistently spearheaded bank-wide operations for
digital transformation under a strategy that aims to lead digital
innovation and conducted digital-focused organizational reshuffling
to respond rapidly to the changing market. Moreover, Woori Bank
intensified competencies to utilize digital technologies including AI,
big data and RPA as core values of a ‘customer-oriented approach’ and
‘enterprise-wide productivity innovation’ and transformed mobile
banking services.
7 Consecutive years
'The Asian Banker
Transaction Awards'
Received the awards for Best Cash
Management Bank at the Asian Banker
Transaction Awards 2019
451 Footholds
In 26 nations, forming the
largest global network
among Korean commercial banks
(As of the end of Dec, 2019)
19 billion
Invested in 20
innovative SMEs
with the largest growth potential
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Retail Banking
The Retail Banking Business
Group develops marketing plans,
provides products and services
and establishes channel strategies
for its retail customers. The Group
constantly strives to efficiently and
proactively meet changes in the
financial environment and provide
value to retail customers.
Woori Bank
043
2019 Performance
In 2019, Woori Bank provided innovative and differentiated products and services to 23.5 million
retail customers. The bank broadened its customer base through partnerships involving contents
that are competitive in target demographics. To reach parents with newborns and toddlers, the
bank have partnered with the globally popular character, Pinkfong, and to market to the youth, it
has secured an e-sports (LCK, League of Legend Championships Korea) sponsorship agreement.
To become a primary banking partner for more customers, Woori Bank secured new Prime Power
Loan (PPL) agreements for employees of businesses that have prime credit ratings and has also
handled the loans related to employee stock ownership plans (ESOP) for companies going pub-
lic with initial public offerings (IPO). In the effort to boost customer satisfaction, the bank offers
services that enable customers to handle banking transactions without needing to adhere to the
constraints of time or place: Tablet Branch provides onsite banking services that enable employees
to easily get to the customers; and WiBee Smart Branch allows automated WiBee Smart Kiosks to
handle transactions.
Senior Plus+, the Very First Financial Brand Targeting Seniors
Woori Bank’s Senior Plus+ is the first of its kind in the financial sector and is a specialized brand for
seniors that targets the 50-plus population. The term ‘Senior Plus+’, means that it adds (+) satisfac-
tion to the four key areas of post-retirement – finance, health, leisure and relationships – to help
seniors more fully enjoy their golden years. To live up to its name, the dedicated website for Senior
Plus+ provides not only financial services including pre- and post-retirement financial planning but
also various other non-financial affiliated services that offer real-life benefits. Moreover, the bank
opened senior-only gathering places called ‘Senior Plus Centers’ where it has hosted seminars
where it has invited customers, to ensure that the service platform covers both online convenienc-
es and personable offline venues. Woori Bank also launched Senior Plus Woori Package – a group
of savings and installment savings products that allow customers to freely deposit or withdraw
funds, while enjoying preferential interest rates/fees along with various other services. In addition,
the bank enhanced public image by holding a public competition on senior plus retirement plans in
alliance with a major daily newspaper, Dong-A Ilbo, and raised its brand value by securing partner-
ship agreements with relevant organizations to generate jobs for seniors.
BI Image
Public Competition on
Senior Plus Retirement Plan
Partnership Services Offered by Senior Plus+
Woori OverviewBusiness OperationsFinancial Review 044
Total Customers of Retail
Banking
(Unit: thousand customers)
YoY
+448
23,507
2019
23,059
2018
New Product Lineup by Life Stage Brand Strategy,
Aiming to Attract New Customers and Make Woori the Primary Banking
Partner for Existing Customers
Woori Bank offers customized products and services in line with life-cycle brand strategy in order
to attract new customers and become the primary banking partner for the existing customers.
While offering school banking to support school project marketing that targets youths, the bank
revitalized retirement pension business and salary wire transfer services for teachers and school
staff. Woori Bank sponsored the first “Pitching Festival” hosted by the Seoul Metropolitan Office of
Education aimed at bolstering the capacities of student job seekers from specialized (vocational)
high schools by helping them sharpen their self-introduction and content-handling skills. The
bank continues to operate a pool of university student publicity ambassadors to enhance the value
of its youth brand, Twenty Woori, and opened up a dedicated lounge. Woori Bank launched the
First-Salary Woori Bankbook for social beginners, offering preferential fees and enhanced services
to retain their business and to become their primary bank. Celebrating the 120th anniversary of
the founding of Woori Bank, the bank launched the Woori 120th Customer Companion Deposit
product that offers long-term customers a maximum 0.6-percent and 1.1-percent interest rates on
Total Loans of Retail Banking
savings accounts and installment savings accounts, respectively.
(Unit: KRW in trillions)
121.0
115.1
Optimized and Efficient Distribution Channel Networks
In step with the shifting financial landscape, Woori Bank quickly entered into markets that called
for an increased demand for financial services, including newly developed neighborhoods, central
business districts and up-and-coming areas, while merging and relocating branches with de-
clining business or overlapping geographical coverage. While 11 new branches opened, 14 were
merged, and 16 were relocated; as of the end of 2019, a total of 874 branches were in operation. To
boost the competitiveness of its sales organization leveraging a highly effective channel strategy,
the bank continues to operate Dedicated Branches for Retail Banking, reinforcing sales compe-
tencies in the retail business. Under this distribution system, financial centers can concentrate on
YoY
+5.1%
2018
2019
corporate business and dedicated branches can focus on retail. In order to raise efficiency in per-
Total Deposits of Retail Banking
(Unit: KRW in trillions)
sonnel management and bolster the competencies of its employees, the bank also run separate
windows for corporate banking, total consulting and deposits; a Total Consulting Team as an inte-
grated window for corporate and retail banking; and a Deposit Total Consulting Team that brings
together retail banking and deposits.
100.5
90.7
2020 Plans
YoY
+10.8%
2018
2019
The Retail Banking Business Group aims to become a retail leader deeply trusted by its custom-
ers. It will continue to provide new products and services that bring true value to the customers
through initiatives like the “Woori Customers, Thank You” project. The group will continue to
upgrade the life-cycle strategy and pursue partnerships with OTT companies in step with digital
trends. Also, high on the list will be to reinforce the competitiveness of core products such as PPL
and rebuild the sales process for non-face-to-face credit loans to enlarge prime assets driven by
non-face-to-face channels. The group will fulfill its social responsibility by supporting microfinance
and providing financial education. Furthermore, it will continue to fulfill the role as the No.1 bank
that stands alongside customers by allocating efficient services in the field of microfinance, while,
on the channel side, pursuing optimization of branches by type, taking into account the financial
scale, characteristics and customer profiles of each region.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
045
Corporate Banking
2019 Performance
In 2019, the Corporate Banking Business Group maintained its number one market share in loans as
a primary creditor. Woori Bank also hosts the Woori Diamond Club, which is a social gathering of the
CEOs from large corporate customers, and serves as an effective channel to anticipate the various
financial needs of customers in advance and strengthen customer relations. As corporate social re-
sponsibility has become a current focus in today’s society, the bank strives to develop products that
will support the mutual growth of companies and to build a culture of cooperation. As of the end of
2019, the Corporate Banking Business Group (including Corporate Finance Centers) is managing a
total of KRW 23.9 trillion in assets, with an operating income of KRW 760.5 billion.
Strengthening Relationship on a Continual Basis
As the corporate customers become major global players, the speed and breath of their financial
needs are continually evolving. The Woori Diamond Club that Woori Bank has been operating since
2003 acts as a channel to strengthen customer relationships and understand the specific financial
needs of the customers in a timely manner. This enables the bank to provide services that respond
to an economic trajectory that is constantly on the move.
Supporting ‘Sangsaeng ’(mutual growth) for Large Companies and SMEs
Woori Bank offers sangsaeng product packages in which it enters into business agreements with
large corporate customers and provide loans with low interest rates to SMEs. In 2008, the bank
launched the Sangsaeng Loan for Partners of Large Companies; and as of the end of 2019, it has
extended a total of KRW 787.2 billion in loans to 2,549 firms through this product. In 2013, the bank
developed the Woori Sangsaeng Partner Loan, a loan package for settlements, and upgraded the
relevant system in 2015; and as of the end of 2019, it offered a total of KRW 440.6 billion in loans to
6,157 companies. As the banking partner of the largest pool of conglomerate customers in Korea, Woori
Bank contributes to the co-prosperity and growth of large companies and SMEs by reducing financial
costs for SMEs with the sansaeng system that operates on the basis of its broad client network.
2020 Plans
The Corporate Banking Business Group will establish a stronger basis for corporate finance by
establishing a new corporate culture under its business goal of “2020! Creative Revenue Genera-
tion! G&CIB Business Expansion!” To this end, the group will first diversify its revenue sources by
pioneering new financial products and venturing into new markets, while promoting income-cen-
tered business by normalizing interest rates and fees. Second, it will pursue a balanced loan busi-
ness by adequately increasing conglomerate assets and managing the risks. Third, the group will
further expand “all-in” margin business, based on networks with large companies, by reinvigorat-
ing all transactions associated with Woori Bank.
Woori Bank is the main creditor bank of 9 large enterprises (2019)
(Total number of large enterprises under main creditor bank management: 30)
The Corporate Banking Business
Group oversees the services for
corporate customers including some
of the largest Korean conglomerates
such as Samsung, LG, and POSCO. As
of the end of 2019, Woori Bank has
banking partnerships with the largest
number of corporate clients among
all Korean banks. The two major
forces driving the Corporate Banking
Business Group are general managers
from the corporate banking branch
and banking center: the former have
driven Woori Bank to become best in
class in Korea; and the latter supports
affiliates and partner companies
while handling the retail banking that
targets the officers and employees
of corporate customers.
These competent managers have
served the wide-ranging financial
needs of corporate clients at just the
right time.
The group is very proud to have
been the financial service provider of
choice for corporate customers who
have grown into major global players
over the past 121 years, and it strives
to offer the expertise it has gained
throughout the years to serve a wider
customer base.
Corporate Banking
Total Assets of 2019
KRW 23.9 trillion
Total CIB Revenue
KRW
56.5 billion
YoY
83.2%
Woori OverviewBusiness OperationsFinancial Review 046
SME Banking
The Small and Medium Corporate
Banking (SME Banking) Business
Group oversees financial services
for SOHOs/SMEs/middle market
enterprises, handling a total of KRW
89.6 trillion in deposits and KRW 57.3
trillion in loans for 1.66 million clients
as of end-2019. The SME Banking
Business Group considers customer
satisfaction as its top priority and
practices “warm-hearted finance,”
supporting the sustainable growth
of its customers. Even amid trying
external conditions marked by
low interest rates, falling interest
margins and an economic recession,
the group reaches beyond mere
profit generation to pursue mutually
beneficial growth with society and
customers. To this end, it provides
a total package of financial services
including competitive financial
products, support for the startup
of new businesses and financial
consulting. The SME Banking
Business Group strives towards the
development of the Korean financial
industry and maximized corporate
value by establishing Support Centers
for Small Merchants, engaging in
innovative/creative/inclusive finance,
running counseling centers on
Japan’s export regulation, developing
a specialized workforce pool and
improving the financial infrastructure.
2019 Performance
In 2019, the SME Banking Business Group witnessed both the quantitative and qualitative growth
of assets. Year-over-year, the group recorded an increase of KRW 5.3 trillion (up 6.3 percent) in de-
posits and KRW 4.3 trillion (up 8.1 percent) in loans while adding 90,000 new corporate customers.
Furthermore, prime asset ratio was increased to 84.3 percent (up 1.0 percent YoY), improving asset
soundness dramatically. Although the interest margin is expected to decline amid low interest
rates and low growth, the group minimized the fall in the interest margin mainly by boosting loans
to SMEs. In addition, the group expanded loans to high-potential SMEs and reduced subprime as-
sets, bringing down the SME delinquency rate by 0.1 percent YoY to 0.35 percent and reaching 86.5
percent collateralized. Furthermore, It had the largest growth in technology financing among
Korean commercial banks by providing KRW 6 trillion to companies with outstanding techno-
logical prowess, such as parts/components/equipment companies and those with innovative
growth potential. The group plans to provide a further KRW 24 trillion in technology financing
over a five-year period from 2019. The group will continue to expand support for companies with
excellent technologies by enhancing technology finance evaluation system with a key focus on
future growth potential. It will also provide KRW 7 trillion by 2024 in support of companies in the
newly growing fields of green/biohealth/fintech sectors, by aligning with policy finance institu-
tions. Meanwhile, in step with government policies, the group extended policy loans of KRW 0.8
trillion to small merchants and the financially underprivileged, proactively carrying out inclusive
finance and CSR.
Technology Finance and Innovation Finance: Quality Up!
Based on in-house technology evaluation system and specialists, Woori Bank boosted technology
finance by KRW 6 trillion in 2019 alone, by issuing systematic and swift technology evaluation re-
ports on innovative SMEs equipped with outstanding technologies that lead the fourth industrial
revolution. Woori Bank also operates a variety of support programs, including indirect/direct
investment and investment combined with lending, to discover and nurture companies with out-
standing technologies. A direct investment of KRW 1 billion each is provided to 20 companies per
year through two public competitions and an indirect investment of KRW 2.1 trillion will be raised
over the next five years by investing in funds managed by policy-based investment organizations
or by managing its own funds. Woori Bank continues to develop and discover outstanding financial
experts by conducting specialized training in technology finance throughout its branches each
year and by providing training on acquiring technology credit appraiser qualifications, which is fol-
lowed up by in-house training on regulation updates.
Revitalizing Policy Finance and Guaranteed Loans in Step
with Government Policy
Woori Bank provided the largest amount of policy funding support among commercial banks in
Korea last year, with KRW 846 billion of policy loans extended to small merchants in line with gov-
ernment policy. The bank made special contributions amounting to KRW 46.9 billion last year to
the Korea Credit Guarantee Fund/foundations/central-local government pacts and extended KRW
500 billion in guaranteed loans, boosting asset soundness. In addition, Woori Bank actively par-
ticipated in revitalizing policy funding based on competitive interest rates by utilizing on-lending
arrangements with the Korea Development Bank and the Export-Import Bank of Korea, along with
C1/C2 funds from the Bank of Korea.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
047
No. of Corporate Clients
(Unit: persons)
1.66 million
Total SME loans in Won
(Unit: KRW in trillions)
82.1
76.6
72.4
YoY
+7.2%
2017
2018
2019
Greater Support for Cooperative Growth and
Inclusive Financing!
In order to provide intensive support to small merchants making inroads into the start-up market,
Woori Bank provides not only operational funds to small merchants, new business owners and
self-employed businessmen who find it difficult to finance their business, but customized consult-
ing on business management, finance, tax and accounting as well as the success stories of start-
ups. The bank operates six Woori Comprehensive Support Centers for Small Merchants in major
regions where it provides customer-tailored total financial solutions. For the self-employed, the
bank operates a finance academy program for which it develops and provides various educational
contents. Moreover, Woori Bank selected “Revitalization of Social Economy” as a core task and laid
the foundation to create an ecosystem for social economy to grow. The bank is driving forward
inclusive finance and cooperative growth by entering into an agreement to provide specialized
support for social enterprises, offering preferred interest rates, lower rates of guarantee fees and
exemptions on various financial fees.
Practicing Corporate Social Responsibility!
Woori Bank provided around KRW 3 trillion of funding liquidity through the following measures:
special business stabilization loans extended to SMEs and small merchants undergoing temporary
difficulties brought on by illness or natural disasters at home and abroad; partnership agreements
with financial institutions under the government; and special contributions. The bank also carried
out social responsibility as a financial company by resolving the financial difficulties of and provid-
ing customized financial support to SMEs through counseling centers on Japan’s export regula-
tion, and these centers were installed throughout its branches.
Prime Asset Ratio(SMEs)
2020 Plans
(Unit: %)
80.2
84.3
83.3
YoY
+1.0%p
2017
2018
2019
In 2020, Woori Bank will bolster agreements with government financial institutions and continue
to boost profitability/growth potential/soundness by providing financial support to SMEs at each
level of their growth. The bank will also expand financial support to innovative companies with
outstanding technologies and fully implement all the steps of assistance for start-ups and new
ventures from kick-start support to ex-post management. The bank will also upgrade its inter-
nal system in order to design customer-centric and customer-first financial schemes, boost the
operational capabilities of SME-dedicated personnel and discover best practices to disseminate
throughout the organization. In addition, Woori Bank will leap forward to become the No.1 bank
by building the best-in-class customer-centric asset management system and conducting a total
analysis of “Voice of Customers”.
Woori OverviewBusiness OperationsFinancial Review 048
Investment Banking
Woori Bank’s Investment Banking
Business Group consists of three
departments: the Investment Finance
Department, the Project Finance
Department and the Global IB Finance
Department. It also contains 12
teams: the CIB Team, M&A Teams 1
and 2, the Equity Investment Team
and Innovative Growth and Finance
Team under the Investment Finance
Department; the Infrastructure
Finance Team, the Structured Finance
Team, the Power and Energy Team and
the Real Estate Finance Team under
the Project Finance Department; the
Aircraft and Ship Financing Team,
the Global Syndication Team and the
Global PF Team under the Global IB
Finance Department.
With increasing importance placed
on the IB business of banks, Woori
Bank has expanded its core IB
business also in the fields of blue
chip equity investments, and M&A
acquisition finance/power generation/
infrastructure arrangements, while
broadening the business scope
through its global networks and IB
desks.
In October 2006, Woori Bank opened
Woori Global Markets Asia Ltd. in Hong
Kong, becoming Korea’s first financial
institution to establish a business unit
with a key focus on overseas IB. Since
June 2017, global IB desks have been
up and running in New York, London,
Singapore, Sydney, Vietnam, India,
Dubai and Germany, where the bank
continues to generate opportunities
for overseas IB business.
2019 Performance
In 2019, the IB Group has increased its non-interest income by intensifying financial arrangements
and making aggressive principal investments involving power generation/infrastructure projects
as well as M&A finance. The IB Group has also expanded its overseas business by adding new
global IB counters. In particular, the group recorded outstanding growth in global IB assets and
profits by managing the largest number of global IB counters among commercial banks in Korea,
enabling the IB Group to generate a sales-related income reaching KRW 300 billion in 2019. It also
expanded high-yield investments through close ties with global top-tier asset management com-
panies, provided aircraft financing, participated in overseas infrastructure/power generation proj-
ects, broadened structured finance and issued FRNs aligned with Woori Global Markets Asia Ltd.
in Hong Kong, maximizing short-term profits while making preemptive investments for the future
growth. Since launching the first Innovative Growth and Finance Team among Korean commercial
banks at the end of 2018, the group has been creating a financial ecosystem for innovative growth
initiatives of the government and investing in companies with innovative growth potential. The IB
Group also hosted four public competitions up until the end of 2019, executing a total of 36 direct
investments in innovative growth companies.
2020 Plans
In 2020, the IB Group will take a step forward as one of the main pillars of the holding company
that creates synergetic effects. With the business goal of “Leapfrogging into a Global IB Group by
Building an Innovative Profit Structure”, the group plans to push forward efficient business, taking
into account the BIS ratio, with a focus on “Securing Financial Leadership”, “Diversifying Blue Chip
Assets” and “Achieving Qualitative Growth for Global IB. Much of its focus and endeavors will be
geared towards building a quicker and more efficient asset management process and system as a
response to greater variability in the global capital market this year. Lastly, as asset management
companies and a trust company were newly acquired in 2019, the group will continue to make an
effort to create synergy with affiliates in the holding company structure by solidifying cooperative
relations. In addition, the group is reinforcing CIB business based on collaboration with large
shareholders in the fields of securities, insurance and asset management as well as with other
business groups within the bank, while making great effort to elevate synergy at the at the level of
the soon-to-be-completed holding company.
Total Assets of Investment Banking Operations in 2019
(Unit: KRW in trillions)
7.2 (48%)
Off-balance Sheet Assets
6.8 (46%)
Loan Commitments
0.4(3%)
Payment Guarantees
Total Assets
14.8(100%)
7.7(52%)
Balance Sheet Assets
Loans 3.6 (25%)
Securities 4 .0 (27%)
Others 0 (0%)
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
049
Financial Market Business
2019 Performance
In charge of major funding and capital management for Woori Bank, the Financial Market Business
Group focused on improving profitability in 2019 by maintaining stable liquidity and raising effi-
ciency in funding and management. The group contributed to enhancing the Bank’s profitability
by maintaining an optimal loan-to-deposit ratio (LDR), diversifying financing, and downsizing
short-term assets. It also promoted its capital adequacy and stability in financing by issuing per-
petual foreign currency-denominated contingent convertible bonds (Co-Cos) and won-denomi-
nated CoCos.
Consequently, the group continued to comply with Korean regulatory guidelines in 2019 in terms
of liquidity coverage ratio (LCR, minimum 100 percent), foreign currency LCR (minimum 80%),
NSFR (minimum 100 percent) and the mid and long-term foreign currency financing ratio (mini-
mum 100%), boosting the bank-wide BIS ratio by 0.59 percentage points.
The group strengthened its competitiveness in F/X and derivatives trading by diversifying trading
currencies and aggressively managing positions. It also runs night-time equity derivative desks
that are available during all global trading hours so that its customers can be prepared at all times
for market risks.
Stable Management of Liquidity
Successfully Responding to the New LDR Rule
In preparation for a new LDR rule in 2020 that applies different weights to loans by borrowers, the
group preemptively increased deposits and restructured its financing by issuing marketable CDs
and covered bonds. As a result, Woori Bank stood fully ready for the new regulation with LDR at 98
percent as of December 2019.
Issuing CoCos in Korean Won and Foreign Currencies
The Financial Market Business Group established preemptive financing plans and launched active
IR efforts based on improved business performance, thereby issuing the largest-ever CoCos in
foreign currencies amounting to USD 550 million at the lowest-ever interest rates among Korean
commercial banks. The group also successfully issued KRW 300 billion in subordinated bonds at
a solid interest rate, raising the bank-wide BIS ratio by 0.59 percentage points and laying a stable
foundation for bank-wide business.
Fulfilling Social Responsibility by Issuing Sustainability Bonds
Leveraging the growing investment demand at home and abroad for sustainability bonds where
the proceeds are used to serve environmental or social purposes, the group successfully issued
Korea’s first sustainability bonds in KRW and USD simultaneously through a single sustainable
bond framework (KRW 200 billion, USD 450 million), boosting the image of Woori Bank and con-
tributing to reducing financing costs. In particular, the USD-denominated Formosa bonds, which
were the first sustainability Formosa bonds issued in Korea, were honored by The Asset, a global
financial magazine, as the Best Formosa Bond in Korea for 2019.
The Financial Market Business Group
consists of the Treasury Department,
which manages Woori Bank’s liquidity;
the Trading Department, which handles
F/X trading, marketable securities, and
financial derivatives; and the Settlement
Support Department, which performs
back office duties. In particular, Woori
Bank is the most competitive of all
Korean commercial banks in trading
derivatives, where it leads the market in
handling forwards, swaps and options
based on a wide range of underlying
assets including interest rates, foreign
exchange, equities, and commodities.
Issued Korea’s First
Sustainability Bonds
in KRW and USD simultaneously
through a single sustainable bond
framework
KRW 200 billion
USD 450 million
USD-Denominated
Formosa Bonds
honored by The Asset as the
Best Formosa Bond in Korea 2019
FX Market Share
Leading market maker in Korea
USD/KRW 8.29%
CNY/KRW 12.67%
Woori OverviewBusiness OperationsFinancial Review 050
LDR (Loan-to-Deposit Ratio)
(Unit: %)
96.6
96.9
95.0
94.1
Complying with Korean Regulatory Guidelines
In 2019, through preemptive financing and stable management of liquidity, the group complied
with Korean regulatory guidelines at a level well above minimum requirements, by maintaining an
average LCR of 107 percent, an NSFR of 109 percent, a foreign currency LCR of 108 percent and a
mid-to-long term foreign currency financing ratio of 170 percent.
Strengthening Competitiveness in the FX and Derivatives Business
In 2019, the Financial Market Business Group endeavored to stand ready to respond to the grow-
ing volatility in the financial market and boost its business competencies through measures that
included profit generation from new sources.
1Q19
2Q19
3Q19
4Q19
F/X Trading
LCR (Liquidity Coverage Ratio)
KRW
(Unit: %)
108.1
107.3
105.4
105.6
19.1Q
19.2Q
19.3Q
19.4Q
In F/X trading, the group bolstered currency forecast capabilities for both domestic and interna-
tional markets and realized outstanding trading profits by taking anticipatory and proactive action
in response to the fluctuations in the international financial market. In 2019, it accounted for a high
market share (8.29 percent in USD/KRW, 12.67 percent in CNY/KRW) in the Seoul F/X market, per-
forming the role of a leading market maker in Korea.
Derivatives
In the derivatives market, the group predicted the trend of market variables such as those related
to Korean and international financial policies and fluctuations in supply and demand. This helped
it to manage positions ahead of time and establish a secure foundation for derivatives trading. The
group also offers FX/interest rate risk management consulting services and customized one-on-
one solutions for SMEs who, due to insufficient experience or skills, struggle with risk management.
Securities
In securities, the group analyzed domestic and international monetary policies and bond markets
and efficiently managed bonds, increasing both interest and non-interest income. It also diversi-
fied its sources of non-interest income by varying and enlarging bond lending transactions that
LCR (Liquidity Coverage Ratio)
Foreign Currency
receive risk-free charges.
(Unit: %)
109.5
108.6
105.1
110.5
2020 Plans
In 2020, the Financial Market Business Group plans to secure liquidity preemptively in order to
prepare itself for liquidity regulations such as the new LDR rule, LCR and NSFR and for increased
volatility in the financial market, both at home and abroad. The group will boost retail deposits,
issue CDs and covered bonds and secure committed lines to manage bank-wide liquidity in a sta-
ble manner, while raising profitability through the reinforced control of funding and management
portfolio.
In trading, the group will broaden both its F/X and derivatives income by diversifying strategies
such as arbitrage in FX/derivatives and foreign currency/interest rate hedging. As growing global
volatility is expected to drive up the demand for risk hedging, the group will continue to broaden
FX/derivatives trading by offering the right product at the right time for all customers. Also, its ded-
icated sales team of specialists for securities firms, insurers, government agencies and other finan-
cial and public institutions will attract new, high-yield customers and boost non-interest income.
19.1Q
19.2Q
19.3Q
19.4Q
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
051
Institutional Banking
The Institutional Banking Business
Group consists of the Institutional &
Public Fund Customer Department
which caters to the needs of the central
government, local governments, courts
and public institutions, in addition to
the National Pension Department, the
primary bank for the National Pension
Service (NPS), which is one of the three
largest pension funds in the world. The
Institutional Banking Business Group
is the first in the Korean banking sector
to establish an institutional banking
specialist pool (institutional customer
RMs), providing first-class financial
services to institutional customers. As of
2019, its institutional customers include
the Ministry of Land, Infrastructure and
Transport (MOLIT), the Korea Post, NPS,
the Korea Land & Housing Corporation
(LH) and the Korea Railroad Corporation
(KORAIL), along with several others.
The group is also a coffer manager bank
for the Seoul Metropolitan City and 20
District Offices in Seoul. Its clientele list
positions us as the primary bank for the
largest number of public institutions in
Korea.
2019 Performance
The Institutional Banking Business Group is built on the robust foundation of Woori Bank’s 104-
year history of managing the treasury of the Seoul Metropolitan Government.. Based on such a
long-running management expertise, the group is broadening transactions with government
institutions, local governments, and major public agencies. It reaches out earnestly to the local
communities of client institutions through various corporate social responsibility programs and it
has built a solid reputation as a financial institution that stands by its local communities.
Since March 2018, Woori Bank has been managing a total of KRW 600 trillion in funds as the pri-
mary banking partner for the NPS – the world’s third largest pension fund. In 2019, Woori Bank
provided institutional banking services as the primary bank for 105 out of 338 Korean public insti-
tutions designated by the Ministry of Economy and Finance. As of the end of 2019, the Institutional
Banking Business Group is managing a total of KRW 31.7 trillion in deposits and KRW 0.6 trillion in
loans, maintaining banking relationships with around 5,000 institutions.
Providing Optimal Financial Solutions for Project Execution
by the Government and Public Institutions
Woori Bank manages a specialized workforce for systems under the Institutional Public Fund &
Customer Department to effectively support the policies and projects of the government and
policy institutions, through which it provides optimal financial solutions for the execution of
public projects. Selected as the primary banking partner for the Institute for Basic Science (IBS),
the Korea Foundation for the Advancement of Science and Creativity (KOFAC) and the National
Fusion Research Institute (NFRI) in 2019, the group has been supporting the technology-cen-
tered new growth policies of the government. In addition, based on differentiated collection and
management systems, the group contributes to making financial transactions more user-friendly
for institutions and citizens as the selected payment bank of seized property sales for the Korea
Asset Management Corporation (KAMCO) and for traffic fines for the Korea National Police Agency
(KNPA).
Maximizing Synergy within the Bank through Transactions
by Institutional Customers
The Institutional Banking Business Group not only provides direct financial services to institutional
customers but also explores and provides opportunities for business alignment to SMEs and indi-
viduals related to institutional projects. Designated as one of the exclusive banks for the research
fund management system (Ezbaro) of the Ministry of Science and ICT, the group provides compre-
hensive financial services for companies that have been successful in R&D, while managing and ex-
ecuting R&D funds, including those for system operations. Working with major local governments,
it also developed a mobile simple payment solution called, “Woori Zero Pay,” laying the foundation
for both lessening the burden of payment fees and attracting new customers for small merchants.
Woori OverviewBusiness OperationsFinancial Review 052
Total Deposits
(Unit: KRW in trillions)
31.7
31.2
27.5
YoY
+1.6%
2017
2018
2019
2020 Plans
In 2020, the group intends to provide a system for effective cash management for government and
public agencies and develop partnership services related to various budget activities so that it can
provide upgraded financial services on a higher level as a preferred banking partner for institu-
tional customers. Furthermore, as the primary bank for the largest number of institutions in Korea,
the group will seek to broaden the range of financial services so that more employees of public
agencies can do business with Woori Bank.
MAJOR LOCAL
GOVERNMENT
PARTNERS
MAJOR MINISTRY/
PUBLIC INSTITUTION
PARTNERS
Seoul Metropolitan City and 20 District Offices in Seoul,
Gwangmyeong City
Ministry of Land, Infrastructure and Transport, Korea Post,
National Pension Service, National Health Insurance Service,
Korea Housing Finance Corporation, Korea Land & Housing
Corporation, Korea Housing & Urban Guarantee Corporation,
Seoul Housing and Communities Corporation, Korea Railroad
Corporation, Korea Exchange, Korea Securities Depository,
Korea Public Finance Information Service, Korea Institute of
Startup & Entrepreneurship Development, Korea Inclusive
Finance Agency, Agency for Defense Development
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
053
Real Estate Finance
For the systematic management of real
estate financing in 2013, Woori Bank
enlarged the Housing Finance Division
into the Real Estate Finance Business
Unit, which was later renamed the Real
Estate Finance Business Group. The
Group also manages the Ministry of
Land, Infrastructure and Transport’s
National Housing and Urban Fund
(NHUF) as the managing custodian
(formerly the general treasury) bank.
To satisfy diverse customer needs, the
group provides not only products that
complement Woori Bank accounts, but
also NHUF products that are available
for low-income individuals and families.
2019 Performance
In 2019, the Real Estate Finance Business Group ranked No.2 in terms of the quantity of mortgage
loan market shares it held. The group alleviated the repayment burden of certain underprivileged
groups by actively assisting them with financial support as per government policies. It also took
the lead in the Korean housing finance market. Woori Bank has also been the managing custodian
bank of the NHUF for the past decade, and a wide range of housing finance products have show-
cased the Bank’s distinguished business performance. As evidence of such endeavors, Woori Bank
was selected as the No.1 NHUF custodian bank once again in 2019.
Widening the Customer Base as the Managing Custodian
(Formerly the General Treasury) Bank of NHUF
The NHUF business is crucial to the progress of broadening the financing options to fulfill the de-
mand for housing finance, which includes that of bridging the divide for low-income individuals
and families. As the managing custodian bank, Woori Bank is in charge of financing and dispersing
funds. Even after its reselection as the managing custodian bank for the NHUF in 2018, Woori bank
provided a diverse range of housing finance products, accounting for a market share of 38.1 per-
cent in loans to the demand-side and 24.7 percent in housing subscription savings plans. In 2019
alone, 930,000 new customers joined housing subscription savings plan in hopes of someday
owning their own houses.
2020 Plans
The Real Estate Finance Business Group will fully participate in government measures to provide
support in the form of housing funds for non-speculative homebuyers and to establish asset port-
folios that ensure balanced asset growth with optimal profitability and minimum risk. To this end,
the group will expand its mortgage loans by KRW 4.6 trillion and provide a robust foundation for
the assets of Woori Bank customers.
The group intends to maintain its number one position in NHUF market share and develop diverse
non-face-to-face channels, bringing greater benefits to its customers as the managing custodian
bank of NHUF. The group will focus on loan plans for the demand-side, which has shown a recent
increase, including Jeonse (Key Money) Deposits, Monthly Rental Loan Plans and the Beotimmok
(Support) Jeonse Deposit Loan Plans, as well as new housing subscription savings plans. Further-
more, the group will leverage its experience in financing and operating funds and refine IT system
to support housing welfare projects for ordinary citizens and take initiatives to revitalize the health
and stability of Korea’s national housing market.
No.1
Custodian Bank
Selected by the Ministry of
Land, Infrastructure and
Transport National Housing
and Urban Fund
Demand-side Loans
(Unit: no. of loans)
Housing Subscription
Savings Plans
(Unit: no. of plans)
Performance 404,281
Performance 5,858,945
No.1(38.1%) Market Share
No.1(24.7%) Market Share
Woori OverviewBusiness OperationsFinancial Review
054
Trust & Pension
The Trust and Pension Business Group
is leading the market with successful
business models that continually
meet customer asset management
needs, keeping pace with the rapidly
changing market environment. As the
sales of specified money trust products
have continued to grow, the Trust and
Pension Business Group has been
playing a leading role in driving the
bank’s overall non-interest income.
The group offers differentiated
and customized services through
comprehensive consulting on
retirement pensions, from the early
stages of introducing retirement
pension schemes at companies and on.
It employes experienced investment
experts utilizing advanced methods
at Woori Bank to manage customized
products that are optimal for the
investment tendencies of customers as
part of total financial services platform,
thereby leading the retirement pension
market.
The group broadened its range of
business with diverse clientele that
consists of 120 entities, including
institutional clients such as the National
Pension Service (NPS), which is the
largest customer in Korea’s securities
custody services market, and the
Ministry of Land, Infrastructure and
Transport (MOLIT) as well as asset
management companies. Leveraging
its experience in the custody agent
business with institutional clients,
the group aims to provide custodian
asset management services that would
preemptively act accordingly in the face
of sudden market shifts.
2019 Performance
Trust Department
The Trust Department of Woori Bank grew considerably through customized strategies under the
business goal of “Boosting Internal Robustness and Generating Profits in the Trust Business,” as it
concentrated on elevating specialized competencies. As a result, and with the assistance of com-
prehensive asset management specialists, it was able to launch a stable line of customized speci-
fied money trust products that meet both the demands of the market and the needs of customers.
Despite growing market volatility, the department achieved a solid return on investment for cus-
tomers and robust profits, primarily through ELT and ETF products. Furthermore, it advanced trust
asset management system to regain credibility with customer base and ensure complete sales,
while improving processes and building a new IT system.
Retirement Pension Business Department
Ever since retirement pension schemes were first introduced to the market, the Retirement Pen-
sion Business Department has implemented a customer-centric strategy to help customers plan
and enjoy a stable retirement, while also addressing the rapid aging issue within Korean society.
The department issues a monthly ‘Happy Life Retirement Pension Newsletter’ for corporate and
individual clients which covers major retirement pension issues, recent trends, asset management
information, and simple life tips. It also provides online information on retirement savings and as-
set management performance or mobile banking via the Happy Life Retirement Pension Lifetime
Account, enabling customers to easily manage their retirement savings.
It also streamlined wire transfer services for pension savings, which made the IRP subscription
process easier, and focused on raising customer yield rates by expanding lineup of TDFs. In addi-
tion, the department maximized customer satisfaction by launching the Retirement Pension Asset
Management Center. As a result, by the end of 2019, assets under custody was KRW 19.6 trillion,
net amount of KRW 2.5 trillion and 14.7% increase YoY.
Trust and Custody Department
Qualitative Growth Driven by Profitability through Enhanced Growth Capacities
in Each Asset Segment
Woori Bank is quickly dominating the fiduciary management market for public and private funds
by establishing a cooperative system with asset management companies based on years of ex-
perience in custody business for large pension funds affiliated with the NPS, MOLIT, and others.
In 2019, the Trustee and Custody Department were able to put their exceptional business skills to
use by taking on more assets under custody from the NPS (KRW 10.5 trillion), insurance companies
(KRW 3.1 trillion) and REITs (KRW 2.3 trillion). By diversifying assets under custody as such and so-
lidifying customer base with a focus on reliably profitable assets, the Trustee and Custody Depart-
ment raised the total volume of assets under custody by 15 percent YoY.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Customer satisfaction boosted
by operating the
Retirement Pension
Asset Management
Center
Woori Bank
055
2020 Plans
Trust Department
Under the 2020 business goal of “Firmly Establishing a Culture of Complete Sales of Trust Prod-
ucts,” it plans to generate profits through the total care of customer assets and through new prod-
ucts by improving system in all its aspects. This in turn, will serve to reinforce customer relation-
ships and boost package sales - and it will be accomplished through building a total management
system for customer assets, not by the mere sale of products. Major products, namely ELT, ETF,
MMT and bond products, will be segmented by risk and investment periods to prevent over-con-
centrated subscriptions into any single type of product. It will also grow in tandem with customers
through presenting products with diverse portfolio combinations suitable to their investment ten-
dencies and periods of investment.
Retirement Pension Business Department
Mindful of the growing importance of the retirement market, Woori Bank has selected retirement
pensions as a core growth business and has been carrying out active marketing campaigns In
2020, the Retirement Pension Department will engage in differentiated marketing to secure a
foundation for growth, boost customer yield rates through bolstered product management ca-
pabilities and focus on raising efficiency in its sales channels. Going forward, the department will
continue leadership in the retirement pension market, and rich pool of experienced personnel, its
comprehensive training support system, and diverse products and specialized asset management
will make this all possible.
Trust and Custody Department
Woori Bank will maintain the No.1 market share in the custody business for institutional clients by
winning the bids it has won before to become the custody bank for large pension funds affiliated
with the NPS and MOLIT. The department will rebuild a preemptive next-generation asset custody
system to provide beneficiary-based services, in order to secure custody competitiveness. It will
also expand its marketing efforts to target those with low-risk assets to move into the public REITs
and real estate fund markets early on. In addition, it will lead the domestic asset custody market by
aggressively targeting the niche market of overseas funds through marketing endeavors geared
towards clients with assets overseas, including institutional clients and insurance companies.
Trust and Custody Department
Retirement Pension Business Department
Dominant Fiduciary
Manager for Public and
Private Funds
Assets Under Custody
(Unit: KRW in trillions)
YoY
+14.7%
19.5
2019
17
2018
Woori OverviewBusiness OperationsFinancial Review 056
Consumer Protection
2019 Performance
At Woori Financial Group, main subsidiaries including Woori Bank and Woori Card are leading the
way in bolstering activities to protect financial consumers. Woori Bank ensures consumer protec-
tion throughout the entire business process from development to the sale of financial products by
undertaking various institutional improvements including a closer monitoring of incomplete sales
prevention activities under the leadership of the Chief Consumer Office. Woori Card promoted
company-wide financial consumer protection activities that were led by the management. To en-
able swift decision-making and gain impetus in protecting consumers, the Woori Card CEO himself
presides over a financial consumer protection council.
Empowering Financial Consumer Protection and Boosting Competencies
In order to make financial services more accessible for persons with disabilities and who are mar-
ginalized from the financial market, Woori Financial Group holds round table meetings with the
Korea Differently Able Federation and the Korea Federation of Organizations of the Disabled to
discover new ideas and reflect them into business management. Woori Financial Group also con-
ducted capacity building training on consumer protection by establishing a training roadmap for a
systematic education and by utilizing various channels including on-site in-person instruction, on-
line video training and collective training, in order to make the education package more effective
and to elicit greater participation from its employees.
Furthermore, the group produced and disseminated the Woori Customer Satisfaction (CS) Standard,
which includes basic skills on interacting with customers, a service-providing mindset and global
business etiquette in order to standardize customer satisfaction management throughout the glob-
al network that has expanded to 477 in 26 nations (two collective trainings per year, included).
Preventing Financial Fraud
In addition to building a monitoring system for financial fraud using Big Data, the group advanced
relevant systems including AI-based monitoring, put up outdoor signboards and played fraud
prevention videos at distribution channels as part of PR efforts to prevent customers from falling
victim to such financial scams. Moreover, as a first among banks, Woori Bank hosted a public com-
petition on anti-voice phishing UCCs for university students and displayed selected works on non-
face-to-face channels including the Bank website and Youtube. As a result, Woori Bank saved 40.6
percent (KRW 44.3 billion saved) YoY by preventing such financial fraud. The Bank also contributed
in the arrest of more than 520 fraud suspects. As such, it engaged in aggressive activities to pre-
vent financial scams and protect customer property.
In February 2020, Woori Financial
Group became the first financial
holding company in Korea to establish
a Financial Consumer Protection Unit to
perform the role of a control tower that
oversees financial consumer protection.
The Financial Consumer Protection Unit
will pursue consistent and systematic
policies at the Group level to reinforce
the entire Group’s competencies to
protect financial consumers. This will
help it to become a reliable financial
group that truly stands beside its
customers.
Woori Bank
Customer Satisfaction
Management Awards
2020
Korea Economic Daily
Woori CS Standard
Developed and
disseminated Woori CS
Standard for a globally
standardized customer
satisfaction management
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
057
2020 Plans
The Financial Consumer Protection Unit aims to build a monitoring system for the Group’s con-
sumer protection and establish a customer-centric culture in 2020. Under this goal, the unit will
systematically inspect the Group’s status of consumer protection, implement consumer protec-
tion reflecting the latest trends and solidify cooperation with Group affiliates.
The unit will build the Group’s monitoring system on financial consumer protection, incorporating
consumer protection policies of the Financial Services Commission and the Financial Supervisory
Service. With this system, it will fully implement the policies of financial authorities and monitor
consumer protection activities at all times throughout the process of development and sale of fi-
nancial products.
Furthermore, the Financial Consumer Protection Unit will hold Group consumer protection round-
tables and gather views from sales sites, so that consumer perception and market changes are
reflected into activities in a timely manner. The unit will make main financial products and channels
more user-friendly in a way that is keenly sensed by the end users themselves. Considering the
continued growth of non-face-to-face transactions, it will regularly review whether essential infor-
mation is provided faithfully on non-face-to-face channels such as information on financial prod-
ucts (interest rates applied, fees, benefits, etc.) sold on those channels and information on the right
to request interest cuts.
Furthermore, the unit will operate a Financial Consumer Protection Conference attended by ex-
ecutive officers of the Group in charge of consumer protection to discover common tasks for the
Group and make improvements. It will also include indicators on financial consumer protection
activities in the evaluation of Group executives.
Financial Consumer Protection Committee
Customers
Consumer Protection
Forum of Branch CS
Managers
Head Office
Consumer Protection
Officers
Financial Consumer Protection Center
Chief Consumer Officer (CCO)
CEO
Financial Consumer
Protection Committee
‧ Highest decision making body
in financial consumer protection
‧ Chaired by the CCO
(CCO: Chief Consumer Officer)
Woori Bank’s
Prevention Education
for Financial Consumers
Woori Bank runs diverse financial
education programs aimed at
empowering financial consumers
and preventing them from falling
victim to illegitimate transactions
Woori Bank Measures to Bolster Consumer Protection and Customer Trust
Heads-of-department-or-above
executives to contribute part of
their salaries to form consumer
protection fund
“Code of Ethics for Asset
Management Sales” to be declared
to protect consumers
KPI overhaul excluding non-
interest income, etc.
Woori OverviewBusiness OperationsFinancial Review 058
Compliance Management
Woori Bank's employees can easily
refer to the Woori Code of Ethics and the
Woori Code of Conduct to understand
the importance of corporate social
responsibility and ethical management
as they perform their day-to-day
responsibilities. By practicing the Woori
Code of Ethics, the people of Woori Bank
fulfill their social responsibilities for all
stakeholders, which include customers,
shareholders, employees, the nation
and society.
Through “compliance management,”
Woori Bank ensures compliance with
laws and principles, respects the
spirit of fair competition and protects
its employees, while contributing
to the establishment of a fair and
wholesome corporate culture that is
based on mutual trust and a mindset of
compliance.
2019 Performance
Reinforcing Ethics and Compliance Training
In 2019, Woori Bank launched various ethics and compliance training programs so that all its em-
ployees are able to understand and put the ideals of ethical management and compliance man-
agement into practice.
First, Woori Bank newly implemented the Woori Bank Code of Conduct and Guidelines for Con-
duct, and hosted an Ethics and Compliance Pledging Ceremony with all the employees. Second,
the bank implemented the bimonthly “Ethics/Compliance Self-Check Test” and “We-Check Day” cy-
ber self-pact, engaging all employees so that they can develop a clear understanding of the Code
of Ethics and examine the behavioral standards applicable to each job ranking. Third, it utilized
the ‘Ethics and Compliance at Work’ section on the bank intranet to publish training materials on
ethics, internal control and compliance online, which the employees can access for their monthly
compliance training and in their line of field work. Lastly, Woori Bank conducts face-to-face com-
pliance training on banking-related laws and regulations for branch compliance officers, aimed at
preventing any violations in branch business.
Action Programs for Ethical Management
Woori Bank offers many programs to promote ethical management and compliance.
The first being the Woori Hotline, a channel through which best practices and violations of the
Code of Ethics can be commended and reported by employees. In other words, the Woori Hotline
is a channel for employees, partners, and other stakeholders to report on compliance with ethical
management standards, aimed at encouraging employees to comply with laws, regulations, and
the Code of Ethics.
Second, the Ethical Management Support Council serves as a meeting group to spread the con-
cept of ethical management and the practice of compliance. The Council holds meetings every
biannually, chaired by the Compliance Officer, to discuss and decide on specific policies related to
ethical management, including measures for employees to practice the Code of Ethics and ways to
improve ethical management.
Lastly, Woori Bank has a “Clean Contract System” with all its partners participating in contracts and
purchases with it to encourage transparent and honorable bidding, contract signing and contract
implementation.
On-Site Legal Services
Woori Bank provides prompt legal services by operating a pool of lawyers exclusively for branches
with the aim of providing contingent legal counseling at business sites. In addition, the bank pro-
vides onsite support by shortening the time required for legal reviews with case-specific standard
agreements uploaded on the legal portal system. Furthermore, the bank promotes better un-
derstanding among bank employees of legal cases by providing a ‘Handbook on Legal FAQs’ with
the most frequently asked legal questions at branches, and posting the information on the portal
system by job type.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
059
2020 Plans
In 2020, Woori Bank aims to “bolster customer trust by complying with laws and regulations
through an innovation of the internal controls mindset.” To this end, the Bank will reinforce internal
controls and management at the head office and at its branches, establish a sales culture based
on the compliance of laws and regulations, intensify its monitoring on unsound business practices
and incomplete sales and build an internal control system that utilizes Reg-Tech.
To reinforce the internal controls and management at the head office and at its branches, an
internal control grading system will be adopted for the heads of business groups and banking
headquarters. In addition, unscheduled monitoring will be bolstered and results thereof will be
reflected into the internal control grading.
Training materials for head office employees will include not only the strong points of products,
but examples of incomplete sales and notes of caution, thereby training the employees on internal
controls to contribute to establishing a sales culture based on compliance.
Last but not least, Woori Bank will utilize Reg-Tech and improve searches on domestic and interna-
tional legislations and regulations as well as implement real-time legal Q&As to increase compli-
ance awareness among employees.
Ethical Management Practice Program
ETHICAL MANAGEMENT
SUPPORT COUNCIL
A working-level council established for the purposes of decision making and communication on
the Code of Ethics programs of practice for employees
FIT & PROPER
(ELIGIBILITY REVIEW)
SYSTEM
CORPORATE ETHICAL
MANAGEMENT INDEX
FOR CREDIT
EVALUATION
CLEAN CONTRACT
SYSTEM
CLEAN-CENTER
(REPORTING AND
COUNSELING)
Aimed at promoting the eligibility, ethical mindset and compliance of employees as financial
professionals, this system categorizes items for additional/subtractive points based on the
Code of Conduct that employees are required to comply with and presents specific criteria for
evaluation. Accordingly, model practitioners receive preferential treatment and violators are
met with guidance or restrictive action.
This program of practice aims at disseminating and inducing CSR and ethical manage-
ment. The corporate ethical management index is reflected into the evaluation items for
loan review, so that ethical management by transacting counterparties is reflected into
the decision in extending loans to them and determining applicable interest rates
Woori Bank has a “Clean Contract System” with all partners participating in contracts and
purchases with us to encourage transparent and honorable bidding, contract signing and
contract implementation. Furthermore, this system is a declaration of Woori Bank’s com-
mitment to ethical management and aims at disseminating ethical management among
partners.
Best practices of Code of Ethics, misconducts and unethical behaviors can be reported
to the Clean-Center, which also offers counseling on ethical matters. These measures are
aimed at making the bank stronger and cleaner and establishing healthy financial cus-
toms.
Woori OverviewBusiness OperationsFinancial Review 060
Information Security
Woori Bank makes every endeavor
to prevent any breach of customer
information by enhancing its level of
administrative and technical security.
2019 Performance
Bolstered Information Security Organization
The Head of the Information Security Group bears the responsibilities of Chief Information Secu-
rity Officer (CISO) and Chief Privacy Officer (CPO), managing all teams dedicated to privacy (credit
information) protection. Woori Bank holds regular Information Security Committee meetings,
chaired by CISO and attended by 15 department heads at Woori Bank who handle information se-
curity, IT operations and development, customer information and other relevant areas. The Com-
mittee discusses agenda items that cover IT security issues as well as internal control and overall
institutional improvements for privacy protection.
Woori Bank also have an ICT security diagnosis team consisting of former “white hat hackers”
serving as information security experts. This team analyzes and evaluates vulnerabilities, conducts
mock cyber attacks and performs internal security reviews for newly launched services to ensure
their safety and security.
Administrative Protection Measures
To prevent the potential abuse or misuse of customer information, Woori Bank allows its employ-
ees to access only the minimal amount of customer data required to perform their job duties. The
bank has also reinforced the internal controls for both the head office and the branches through
the regular monitoring of unauthorized personal information queries deemed irrelevant to work
duties, along with inspections of how it is managing its customer information. In addition, all em-
ployees are mandated to attend an information security training at least twice a year. Woori Bank
also makes onsite visits to promote privacy awareness and prevent security breaches.
When a situation deems it necessary for the bank to consign customer information for business
purposes, it discloses the scope of responsibilities and the consignee information on the web-
site. The bank conducts a regular inspection of how customer information is handled on the part
of consignees and provide information protection training. Management and supervision of
consignees are always thorough to ensure that customer information is not lost, stolen, leaked,
forged, falsified or damaged.
Employee campaign launched, aiming to
enroot a culture of information security
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
061
Technical Security Measures
In order to inspect information security risks preemptively, Woori Bank adopted the ‘Cyber Red
Team’ which detects vulnerabilities at all times from the viewpoint of attackers. Woori Bank also
established a cloud-based defense system to guard against large-scale DDoS attacks with the
Financial Security Institute.
Woori Bank became the first financial institution in Korea to adopt a Fraud Detection System
(FDS) that analyzes non-face-to-face transaction logs based on Big Data, in an effort to better
respond to new or novel security threats and cyber risks. The bank also applied a solution to the
smart banking system that can detect malicious or remotely controlled apps, thereby taking the
lead in protecting consumers from financial scams such as voice phishing.
2020 Plans
The Information Security Department will advance its SIEM to bolster the real-time integration,
analysis and response system against cyber security threats in and out of the company, while
adopting specialized solutions to diversify security drills for employees in step with the rising num-
ber of malicious e-mail attacks. Furthermore, it will become the first financial institution to acquire
the international ISO 27701 and the domestic ISMS-P certifications, thereby enhancing privacy
protection, and ultimately become an even more trustworthy and reliable bank for its customers.
Information Security
Bolstered Information
Security Organization
Administrative
Protection Measures
Technical Security
Measures
Acquired ISO27701 certification, the international
standard on personal information management system
"How Smart Seniors Can Use Smart Phones
Safely" - an anti-fraud education for seniors
Woori OverviewBusiness OperationsFinancial Review 062
Anti-Money Laundering
As financial companies are required to
establish preventive policies against
international money laundering and
terrorism financing, Woori Bank
operates the Anti-Money Laundering
Center. The Center established the AML
Planning Team in addition to the existing
Domestic AML Team, Overseas AML
Team and Sanctions Management Team,
hiring a large pool of AML specialists
and expanding the organization.
Furthermore, it bolstered internal
control to prevent money laundering
and terrorism financing by becoming
the first Korean bank to adopt a three-
tiered Know-Your-Customer (KYC)
system on par with defense systems
of global financial companies. In a bid
to boost the global competitiveness
and credibility of Woori Bank, the bank
hired AML/BSA specialists from the
Office of Foreign Assets Control (OFAC),
reinforcing internal controls at the AML/
Sanctions Department of its American
branches. Woori Bank is also upgrading
its AML/Sanctions systems throughout
overseas branches and subsidiaries to
be commensurate with those of global
financial companies.
First AML Internal Controls
System in Korea
Know Your Customer (KYC)
system established and piloted at
460 branches of Woori Bank
2019 Performance
Building a Global-Level KYC System
Woori Bank built a KYC system with three lines of defense: customer identification, inspection
by the Anti-Money Laundering Center and independent audit by the Inspection Office. The bank
also enhanced its specialized workforce, relevant regulations, guidelines and systems to defend
against money laundering and terrorism financing, in order to faithfully carry out policies of the
Financial Action Task Force (FATF) and the Korea Financial Intelligence Unit (KoFIU).
Boosting a System of Compliance at Overseas Branches
Woori Bank bolstered the anti-money laundering system of its global network in order to preemp-
tively boost compliance at its overseas branches. The bank aligned with a global consulting firm to
check on the status of anti-money laundering at overseas branches and upgraded its AML system
to meet the global standard. Woori Bank also engaged in various activities in order to satisfy the
high standards of compliance programs required by US financial authorities, which led to remark-
able improvements including the positive inspection results of its American branches by local su-
pervisory authorities. Woori Bank was also able to mitigate money laundering risks at its overseas
branches by conducting sophisticated risk assessments on all overseas branches and reflecting
FATF recommendations.
Bolstering the Sanctions Compliance Program
In 2019, Woori Bank launched wide-ranging control activities to bolster and deepen its sanctions
compliance program. First, the bank reinforced internal controls by extending the sanctions list of its
SWIFT filtering system applied to branches at home and abroad. By adding additional names to the
existing official sanctions list, it enabled itself to preemptively manage sanctions-related risks. Sec-
ond, Woori Bank reinforced the Bank’s internal controls by conducting a sanctions risk assessment
on domestic and overseas branches. The bank was able to identify the Bank’s inherent risks related
to sanctions, assess the adequacy of internal control activities and close any existing vulnerabilities.
Third, the bank bolstered awareness of sanctions compliance by providing sanctions training for its
employees and through quickly disseminating the latest trends. Woori Bank also conducted training
for executive officers by inviting outside specialists to instruct them. It also provided customized
training to employees in charge of internal control at branches, new heads of branches, employees
assigned to overseas branches, employees handling transactions with high-risk clients and to its
client companies. Woori Bank also quickly notified employees of changes taking place in international
sanctions, thereby continuously reinforcing its sanctions compliance program.
2020 Plans
Woori Bank continues to enhance the level of its AML operations by bolstering ML/TF risk assess-
ments and KYC systems as well as improving the transaction monitoring system. In addition, its
aim is to further solidify a fundamental culture of anti-money laundering by developing a pool of
specialists and reinforcing AML training programs for employees. At overseas branches, the bank
continues to upgrade its AML/Sanctions systems and verify its sanctions compliance program on
AML Experts
a regular basis in order to manage and control sanctions risks preemptively. At subsidiaries, the
110
bank is building an anti-money laundering system that meets the standards of international and
local supervisory authorities by aligning with a global consulting firm to diagnose the status of the
AML system.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
063
Wealth Management
The Wealth Management (WM) Group
oversees serves not only Private
Banking (PB) customers but also the
bank-wide asset management business
including services for corporate
customers.
The WM Group consists of 12 teams
under three departments (the WM
Strategy Department, the PB Customer
Department, and the Affiliate Products
Department).
The WM Strategy Department manages
bank-wide assets, oversees business
strategies for PB customers, and
suggests bank-wide recommendations,
while establishing non-face-to-face
channel asset management strategies
and runs the required systems.
The PB Customer Department devises
business strategies for PB customers
and nurtures, operates and manages a
specialized workforce and channel for
asset management. It also provides tax
consulting, real estate advisory services
and other specialized services for high-
net-worth (HNW) customers of Woori
Bank.
The Affiliate Products Department
selects fund and bancassurance
products, forms marketing strategies,
develops investment products, selects
affiliate products and conducts follow-
up management.
As of the end of 2019, Woori Bank has a
total of 737 WM distribution channels.
It has 747 private bankers (PBs) and
financial advisors (FAs) who, as asset
management experts, deliver best-in-
class comprehensive asset management
services to HNW customers through a
specialized PB brand called “Two Chairs”.
2019 Performance
Performance of Affiliate Products (Funds and Bancassurance)
In 2019, profits reached KRW 90.2 billion in funds, driven by wide-ranging marketing efforts in-
cluding the launch of 120th anniversary products and collaborations with SME relationship man-
agers (RMs). Meanwhile, on the bancassurance front, Woori Bank ranked No.1 in market share
(34.2 percent) among four major commercial banks in Korea and posted profits of KRW 86.5
billion by diversifying portfolio through the launch of new products and reinforced non-face-to-
face line-up.
Developing a Specialized Workforce and Strengthening
Competencies in Asset Management
Woori Bank provides significant support and investments to foster a specialized workforce for
asset management. The bank provides customized PB/FA training based on straightforward CDP
and nurture next-generation personnel early on through public competitions. In particular, in
2019, it came together with external specialized institutions for high-quality training on not only
PBs and FAs but next-generation personnel, in order to boost the competitiveness of its special-
ized workforce. To foster a pool of specialized asset managers, Woori Bank bolstered its competen-
cies by operating separate intensive development courses on real estate, inheritances and gifts.
Expanding the Customer Base
At the core of the WM business is base of PB customers. In 2019, Woori Bank attracted 19,000 new
PB customers, which is the highest increase rate (9.8 percent) among Korean commercial banks.
This was the result of the targeted marketing of CEOs through collaboration between PBs/FAs and
SME RMs as well as wide-ranging business support for new PB customers.
Expanding the Asset Management Business Base
Woori Bank expanded business base for PB customers by adding four new TC Premium Centers
dedicated to HNW customers, where it provided specialized consulting in tax and real estate as
well as comprehensive asset management services. Furthermore, it held global investment sem-
inars in collaboration with Bank Woori Saudara Indonesia and Woori Bank China. Here, the bank
expanded its global business base by providing locally-tailored investment seminars and one-on-
one consulting services for Korean expats, businessmen and resident workers.
Wealth
Management
Group
Customer Care
Center
Wealth Management
Strategy Department
Private Banking
Customer Department
Affiliation Product
Department
Woori OverviewBusiness OperationsFinancial Review 064
Bancassurance M/S
No.1(34.2%)
Bancassurance takes up No.1
market share among the nation’s
top four commercial banks with
launch of new products and rein-
forced non-face-to-face line-up,
posting profits of KRW 86.5 billion
WM Distribution Channels
737 Channels
Asset Management Experts
747 PBs/FAs
2020 Plans
Woori Bank will leap into becoming a more reputable asset management company that places its
highest priority on its internal robustness and its customers, by improving business fundamentals
through innovation across the board that encompasses asset management business, system and
consumer protection.
Business System Innovation
The Chair of the Asset Management Product Committee in charge of selecting products was
promoted from the head of the department level to the head of the group level and the commit-
tee members were also promoted from team leaders to division leaders. In addition, outside
specialist members were appointed to boost expertise. Product and marketing organizations will
be separated to provide customer-centric products and recommendations will be derived at the
holding company level to present a unified direction on investments. At the product sales stage, its
personnel will be given different clearance levels to sell investment products depending on their
risk. A PB workforce verification scheme will be newly introduced to bolster internal the qualifica-
tions criteria. Moreover, the asset management capacity index will be developed and measured to
foster PBs that can represent Woori Bank. The thresholds and return on sales of each product and
management company will be reviewed on a regular basis to reinforce risk management. For ex-
post management, a dedicated organization directly under the Head of the WM Group was newly
established in order to ensure complete sales and customer interest protection (Customer Care
Center). Furthermore, ex-post management schemes for funds including ‘happy calls’, tape-re-
cording schemes and customer deliberation schemes are undergoing improvement.
Infrastructure Innovation
Woori Bank is in the process of rebuilding the asset management system that supports high rates
of return and risk management. The bank also enacted and distributed the Code of Ethics for Asset
Management that places customer interests the No.1 value. For overall customer demographics,
Woori Bank will adopt a life-cycle asset management system to provide optimized portfolios.
Business Culture Innovation
Woori Bank overhauled the KPIs of distribution channels and PBs/FAs with a customer-centric ap-
proach. Moreover, the bank adopted a business management certification scheme, under which
evaluation of executive officers reflect protection of financial consumers, so that evaluation by cus-
tomers can be directly incorporated into the performance evaluation of officers.
* Distribution channel KPIs: Customer’s Rate of Return 20 points (H2 2019)
Customer Care 50 points (2020)
Customer’s Rate of Return 50 points,
→
Private Asset Management Brand
Private Banking Brand of Woori Bank
One-on-one tailored
financial consulting services by
asset management experts
Private banking services dedicated to
each customer offered in a fittingly
refined setting
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Bank
065
Employee Satisfaction
Woori Bank believes that a workplace
where its employees are happy is a
necessary foundation for providing
the best services to its customers. This
led to the creation of the Employee
Satisfaction Center in 2007, and since
then, the Center has been developing
and implementing diverse programs.
Woori Bank is expanding its leisure and
travel programs to improve employee
satisfaction with the hopes they will feel
a stronger sense of ownership.
2019 Performance
Woori Bank Wibee took home the 11th championship title in the 2019-2020 WKBL Regular League.
Driven by the enthusiastic cheers of employees, the excellent tactics of head coach Wie Sung-Woo
and the tireless spirit of the athletes, Wibee broke its own record and made history once again with
the first-ever V11 in the WKBL. Now, Wibee has its eyes set on another monumental achievement
in the V12 next season.
Implementing Programs for Greater Employee Satisfaction
Woori Bank offers original and interesting programs to boost employee satisfaction. In 2019, the
bank offered the “Woori Family Together Camping” program for its employees and their families.
Woori Bank also provided Special Lectures on Culture to meet the cultural needs of its employees
and help them build networks. Among its existing programs, the bank continues to offer the family
getaway initiative, “Oh! Happy Woori,” and a psychological counseling program to help employees
deal with feelings of insecurity or family issues. Woori Bank is doing its utmost to put into practice
Woori Bank’s core belief that stipulates that the happiness of its employees and their families is the
core foundation of the Bank’s competitiveness.
Oh! Happy Woori
“Oh! Happy Woori” is a family getaway program that began in July 2011 and is based on the idea
that happy families are the very source of employee satisfaction. Employees and their families can
participate in the seasonal experience programs to spend time together and refresh themselves
physically and mentally. Last year’s programs included “Understanding Constellations”, “Visiting
Pocheon Herb Island”, “Visiting Korea Job World”, “Visiting My Mother’s Family” and “Strawberry
Picking and Smelt Fishing”. In particular, the “Companion Program with Spouses” reinforced
the corporate culture that all happiness starts with family. This program has become the most
preferred and sought after of all the offerings, allowing its employees an opportunity to spend
quality time with their families and remind themselves of how important family is.
Head Office Auditorium as a Free Wedding Venue
Woori Bank rents out the auditorium at its head office building as a wedding venue for employees,
free of charge. The location has been praised by its employees for its spaciousness, the ample
amount of time allowed for the ceremony, and its refined atmosphere. The venue features a
V11 in the Women’s Korean Basketball
League (WKBL) 2019-2020 Season
Woori Wedding Day: A joint wedding
ceremony for multicultural couples
Woori OverviewBusiness OperationsFinancial Review 066
'Oh! Happy Woori'
A family getaway program that began
in July 2011 and also the leading family
care program based on the idea that
happy families are the very source of
employee satisfaction
Prevention Training
and Psychological
Treatment
Woori Bank has provided prevention
training and psychological treatment
since 2017 for employees who interact
directly with customers, to protect
them from verbal and physical violence
as well as sexual harassment.
gorgeous bridal room, a separate room for performing the traditional Korean wedding ceremony
known as pyebaek, and a banquet hall for the wedding reception. The CEO’s official vehicle is also
made available as the wedding getaway car, which is particularly applauded by the employees. A
total of 873 couples walked down the aisle in this auditorium between 2012 and 2017. Its popularity
continued in 2018 and 2019, with an additional 150 and 160 couples marrying there in each year re-
spectively. The benefit of this free wedding venue offer is twofold: it not only helps its employees save
on wedding costs but also boosts the sense of pride its employees feel in Woori Bank.
2019 Programs to Protect Employees Who Interact Directly Customers
Woori Bank has provided prevention training and psychological treatment since 2017 for employ-
ees who interact directly with customers, to protect them from verbal and physical violence as
well as sexual harassment. In accordance with the Occupational Safety and Health Act, the bank has
produced the “Promotional Materials to Protect Direct Interactors” since October 18th 2018, in order
to protect employees from verbal abuse and sexual harassment by customers. Woori Bank has dis-
tributed them to all branch offices in 2019. It also conduct training to prevent physiological or physical
harm to its employees. To reinvigorate the organization and to better engage its employees in their
work, the bank make reservations and provide funding for therapy sessions and legal counseling
for its employees and their families. Woori Bank offers in-house professional counseling in addition
to the externally run Employee Assistance Program (EAP), offering on-site counseling and small
lectures at the branch level through TFT business support. In addition, the bank present employ-
ees with opportunities to manage their stress and relax with Tok-Tok Concerts and Office Training
Programs. Woori Bank also lead the way in improving its organizational culture with preventive
training for sexual harassment in the workplace and wide-ranging campaigns to prevent conflicts
among employees.
Woori Daycare Center
As part of the government’s policy to address the country’s low birth rate and actively support work-
ing parents, Woori Bank runs corporate daycare centers in Seoul in Mapo-gu (Happiness Center),
Seongdong-gu (Love Center), and Jung-gu (Dodam Center, opened at the Woori Bank head office
building in August 2016). In addition to the three existing centers, the bank opened the fourth cen-
ter in Bundang, Gyeonggi Province (Saesol Center). Woori Bank will continue to open new daycare
centers to promote a corporate culture that encourages a stable family life and do the best to help
working parents cope with childcare challenges. Woori Bank strives to ensure that each and all of its
employees are happy and that happy employees, in turn, will make its customers happy.
Woori Bank Programs to Protect Employees Who Interact
Directly Customers – “On-Site Roundtable with Direct Interactors”
Woori Daycare Centers installed and operated to
provide corporate support for working mothers
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 'A Day When Woori
Meets Culture'
A support program to encourage
employees and their families to take
part in enriching cultural activities
Smart Health
Check-Up Service
Introduced to enable quick and easy
application for check-ups
Woori Bank
067
Experiencing Other Cultures
The program that assists its employees to take overseas trips is gaining huge support. Woori Bank
has travel agencies set up a dedicated website for its employees where they can choose from a
variety of travel programs. As part of a virtuous cycle of providing welfare that inspires employees
and customers and brings them satisfaction, the Woori Bank Employee Satisfaction Center runs
refined and wide-ranging programs that can truly serve its employees.
A Day When Woori Meets Culture
This is a support program to encourage its employees and their families to take part in enriching
cultural activities. First launched in 2012, the program made group ticket purchases in 2019 for
musical performances including the Flashdance, Jekyll & Hyde, Mama Mia and Aida. Employees feel
a sense of belonging and pride as the bank rents out the entire theater for the day to allow employ-
ees to choose their own showtimes and present an exclusive show just for Woori families.
Improving “PC-Off” Policies for Work-Life Balance
The Banking industry has characteristically imposed a work environment that entailed overtime
work into the night. To improve such conditions, Woori Bank introduced a work-life balance policy in
2013, which then became established as part of corporate culture at Woori Bank, as most offices and
branches came to comply well with the policy. The so-called ‘PC-Off’ deadline is at 19:00 to ensure
employees have time for leisure activities and family life and to help them return to work with greater
efficiency and focus. In July 2019, Woori Bank took the initiative in striking the work-life balance of its
employees by firmly establishing the 52-hour work week system and flexible work hours.
Building a Healthy and Vibrant Work Culture
Woori Bank offers annual medical check-ups and blood tests in order to continually and systemat-
ically manage the health of its employees. If any symptoms are identified from the check-ups, the
bank supports affected employees with its group accident insurance and the Bank’s medical fee sub-
sidy plan to create a healthy and active work culture. In addition, Woori Bank also adopted the “Smart
Health Check-Up Service” that is more convenient and allows for a faster application for check-ups.
This service allows employees to check on their reservations, changes, and results in real-time via an
app. It is built in a way that allows the health status and check-up results to be systematically cumu-
lated and managed. Furthermore, its employees and their families are entitled to book and use the
shared condominiums Woori Bank owns all over the country. These facilities are now made available
to employees for much longer periods, allowing longer stays for more employees. These benefits
help its employees refresh themselves and build a vibrant work culture.
"Special Lectures on Culture" meeting cultural
needs of employees and supporting networking
Healthy Woori Program to create a vibrant work-
place and promote the health of employees
Woori OverviewBusiness OperationsFinancial Review 068
Social Contribution Activities
Woori Bank’s roots are embedded
in Daehan Cheonil Bank, which was
established in 1899 with funds from
the imperial family by Emperor Gojong
who envisioned to protect Korean
commerce. For 121 long years, Woori
Bank fulfilled its role to contribute
to national development, driven by
the pride of being the bank of Korean
capital. Particularly in today’s world,
where the emphasis is on the social roles
and responsibilities of finance, the bank
continues to practice sharing in order to
prosper together with local communities
to realize the three values of Humanity,
Happiness and Hopefulness, and carry
out diverse social contribution activities
including support for small merchants
and microfinance in order to fulfill
responsibilities as a major financial
institution.
2019 Performance
Humanity: Humanity in Action with Local Communities
Woori[we] Love Sharing Program: Woori Bank’s Signature CSR Program
Since launching the Woori Bank Volunteer Corps in July 2007, Woori Bank has been engaged in a
number of social contribution activities through its nationwide branch network. The Woori [We]
Love Sharing Program is signature CSR program for all bank employees to take part in social con-
tribution activities. It involves welfare facilities that have established sisterhood agreements with
34 regional business headquarters. The bank encourages employees to volunteer and provide
sponsorship on a regular basis for the socially marginalized, including struggling youngsters,
elderly citizens, and the disabled. Woori Bank also runs a social contribution campaign in the first
and second half of the year, giving out awards to high-performing branches in the area of social
contribution to encourage voluntary participation by employees. The donations for social welfare
centers raised during the campaign period are used to support the underprivileged. In February
2019, as part of the Woori G-CSR Festival 2019, Woori Bank deployed a bank-wide social contri-
bution campaign with the participation of subsidiaries and branches from 26 nations across the
globe as well as domestic branches. From its global network, 317 employees in 22 subsidiaries
and branches of Woori Financial Group from the US, China, Cambodia, Brazil and India took part,
while domestically, 721 employees from 64 branches came together to help neighbors in need.
Donations amounting to KRW 115.4 million were delivered to social welfare facilities to support the
socially marginalized.
“Blood Drive” with Greater Compassion
Woori Bank has been conducting a ‘blood drive’ campaign since 2006. The campaign, carried out
during July and August when the need for blood is greatest, is one of Woori Bank’s longest running
social contribution activities where employees from branches nationwide voluntarily visit nearby
blood donation centers to donate blood and receive donation certificates. In 2019, the bank re-
ceived a total of 1,078 blood donation certificates after the blood donations from Woori Financial
Group employees were delivered to the Catholic University Eunpyeong at St. Mary’s Hospital for
patients fighting incurable illnesses, including leukemia and pediatric cancer. Woori Bank will
continue the blood drive consistently, so that voluntary blood donations by its employees can help
save lives.
“Good Together” – A global CSR campaign
launched by Woori Financial Group
Blood Drive Campaign for underprivileged patients fighting
incurable illnesses including leukemia and pediatric cancer
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Care Fund Project
5,760 employees
KRW 395 million
In 2019, an average of 5,760
employees voluntarily took part
each month and raised a total of
KRW 395 million
Woori Bank
069
Sharing Daily Necessities for the Underprivileged
Woori Bank continues to engage in the act of sharing with the underprivileged during traditional
holidays and the winter season. This January, the Woori Bank head office marked the beginning
of the Better Together Campaign as the CEO joined 196 new recruits in distributing 2,300 Woori
Hope Boxes consisting of meal kits for the New Year holidays. These kits went out to 2,300 house-
holds in Seoul, including to elderly individuals living alone and to low-income families. For the Chu-
seok holidays, KRW 100 million’s worth of meal kits consisting of essential staples such as seasonal
fruit and meat were delivered to 120 facilities in Seoul that house children, the elderly, persons with
disabilities and the homeless, in an effort to reach out to the socially marginalized who live within
the blind spots of welfare assistance.
Happiness: Pursuing Happiness through Sharing
Woori People’s Culture of Donation: “Woori Care Fund”
Woori Bank runs the “Woori Care Fund” where employees voluntarily donate a certain percentage
of their monthly pay to help fund social initiatives. Woori Care Fund was launched in 2003 for CSR
purposes with the voluntary participation of employees. As of 2019, an average of 5,760 employ-
ees participated each month and raised a total of KRW 395 million. The Fund finances the “Woori
Care Fund Public Competition Project” where outstanding social welfare programs are submitted
by non-profit corporations and groups across the nation in the first and second half of the year to
receive on-on-one matching donations from Woori Bank in a bid to support the socially marginal-
ized. Woori Bank is now twelve years into the project since its start in 2009 and it has supported ex-
cellent social welfare programs that target marginalized children and elderly citizens who fall with-
in the blind spots of social welfare. This project does a great deal in supporting the independence
of the socially vulnerable, and provides cultural support for the marginalized. In 2019, Woori Bank
donated KRW 300 million to 20 social welfare organizations and 20 community children’s centers.
In particular, the bank utilized leading donation platforms in Korea such as Happy Bean of Naver
Co. and Together with Kakao of Daum Kakao Corp. to maximize customer donation in support of
outstanding social welfare programs in the community.
Woori Hope Box delivery ceremony to wish happy New Year
holidays for underprivileged neighbors in the community
Social welfare programs for the underprivileged
Woori OverviewBusiness OperationsFinancial Review 070
Employee Volunteers
42,636 persons
Total Expenditures on
Social Contribution
(Unit: KRW in 100 millions)
1,494
1,065
Projects to Support Future Leaders
Woori Bank engages in diverse social contribution programs to lend a hand to future generations.
Last year, the bank operated an education program that invited community children’s centers to
visit museums and provided 40 sessions of financial education to socially marginalized children.
In addition, a total of 1,262 children learned about the Bank’s history and the basics of finance
through customized education program that offered diversified hands-on financial experience.
Woori Bank offers Woori Together Scholarships for Youth to well-performing students at the com-
munity children’s centers that have established sisterhood ties with the Bank. In 2019, 74 children
received scholarships totaling KRW 35 million. Woori Bank also hosts the Special Event for Children
from Remote Islands and Areas program for children from rural or fishing villages where social and
cultural resources may be relatively scarce. The event offers diverse excursion programs including
visits to Gyeongbok Palace and museums.
Hopefulness: Inspiring Hope through Communication
and Mutual Prosperity
“Global Volunteering” to deliver hopes
To address social issues in the global community through the bank’s global networks, Woori Bank
YoY
+40.3%
conducts a variety of CSR activities and fulfills its social responsibilities as a global financial firm. In
February 2019, its Global Volunteer Corps of 45 Woori Financial Group employees were dispatched
to the YANKIN Children’s Hospital in Yangon, Myanmar. They engaged in various meaningful
2018 2019
activities: facility maintenance and repair for children to receive medical services in a clean envi-
ronment; teaching activities involving fine arts or physical education; and entertaining cultural
performances to bring cheer to children exhausted from lengthy medical treatments. In July, the
bank launched the Kind-Hearted Shoe-Making Campaign for children suffering from poverty all
around the world. Shoes were handmade by employees and their families and donated along with
monetary donations to NGOs that used them to help children living in poverty in Indonesia.
Mecenat Activities to Support the Underprivileged
Woori Bank has been running the “Healing Concert for Youths” project since 2018, sending an
orchestra to perform classical music at schools for children who have little opportunity to come
across such music. The Healing Concerts are a part of its culture and arts project to raise aware-
ness of disabilities and inequality among future generation by presenting collaborative works
of disabled and non-disabled performers. More than 7,000 students in 12 schools attended its
Learning about the economic role of banks and importance
of saving, visiting exhibition rooms full of relics and films
Fulfilling CSR by launching global activities for the underprivi-
leged in nations where Woori Financial Group has presence
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Healing Concert for Youths
12 schools
7,000 students
Raising awareness of disabilities and
inequality among students by
presenting collaborative works of
disabled and non-disabled performers
Woori Bank
071
concert in 2019. On the Day of Persons with Physical Disabilities on November 11 2019, Woori Bank
sponsored Yoo Soo-Young, a promising badminton player with physical disabilities, presenting
him with a tailored sports wheelchair and funds for training. Woori Bank also supported repairs for
wheelchairs by visiting welfare halls for the disabled across the nation.
2020 Plans
Benefit from Finance, Warmth from Sharing
Building a Unique Woori Culture of Sharing with Employees, Families and Customers
In 2020, Woori Bank will conduct locally tailored CSR activities with its sister organizations includ-
ing Woori Love Sharing Program and continue employee campaigns in the first and second half
the year. Woori Bank will conduct the Do Good! Campaign aligned with Naver Co.’s Happy Bean
that will encourage family participation and host public competitions on donation platforms such
as Naver Co.’s Happy Bean and Daum Kakao Corp.’s Together with Kakao to build Woori’s unique
culture of sharing along with employees, their families and customers.
Nurturing the Future Generation and Supporting the Underprivileged
In 2020, Woori Bank will expand its financial education sessions for community children’s cen-
ters and the Woori Together Scholarships for Youth program to continue its projects to nurture
the future generation. In addition, Woori Bank will work on reducing inequality and sharing with
neighbors through support projects for elderly members in the area, persons with disabilities and
multicultural families. Furthermore, the bank will take the lead in practicing CSR by providing im-
mediate support whenever a natural disaster, like a fire, epidemic or typhoon strikes the country.
In H1 2020, Woori Bank provided preventive kits to high-risk groups of COVID-19 in order to pre-
vent the spread of the virus. In February, the bank delivered KRW 500 million worth of food items
and monetary donations from employees to socially vulnerable elderly individuals and children’s
facilities in the Daegu-Gyeongbuk region. In March, Woori Bank supplied lunch boxes and health
supplements every day for 400 healthcare providers in district general public hospitals in Daegu
and starting in April, Woori Bank has been continuing anti-infection projects at 160 children’s wel-
fare centers in Seoul.
Supporting underprivileged children with not enough to
eat as COVID-19 forces schools to suspend school meals
Woori OverviewBusiness OperationsFinancial Review 072
WOORI
CARD
Customer
-Centered
Services
Woori Card was separated from Woori Bank in April 2013 in a bid to bolster Woori
Financial Group's competencies in the credit card business and competitiveness in the
non-banking sector. Based on an expansive banking network and customer base, Woori
Card devised optimal business strategies as the credit card affiliate of the Group and
is proactively pursuing new business to secure a new engine of growth. Furthermore,
Woori Card places topmost priority on customer value throughout its business in
developing products and services that cater to the needs of its customers. Woori Card
also brings differentiated services to customers by actively forging partnerships with
other industrial sectors and expanding business scope. As Woori Financial Group was
inaugurated in January 2019, and Woori Card was incorporated as a subsidiary in
September of that same year, Woori Card expects to generate powerful synergy with
its Group affiliates.
2019
Woori Card wins
2019 Family Friendly
Certification and
Government Award,
Ministry of Gender Equality
and Family
Woori Card wins
Check Card No.1 Award,
Korean Standard – Premium
Brand Index Grand Prix 2019,
Korea Standards Association
/ Chosun Ilbo
'Standard of Cards' wins
the Credit Card Category of
Korea Good Brand Awards
2019, Dong-A Ilbo
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Card
073
Usage
(Unit: KRW in 100 millions)
826,495
763,575
738,565
YoY
+8.2%
2017
2018
2019
Operating Income
(Unit: KRW in 100 millions)
17,558
13,867
13,681
2017
2018
2019
Net Profit
(Unit: KRW in 100 millions)
1,265
1,142
927
YoY
-1.3%
YoY
-9.7%
2019 Performance
Part 1. Business Performance
The volume of payments being settled via cards is increasing, driven by a growing membership
pool, aligned business with Woori Bank and an aggressive entry into the simple payment market.
Woori Card also continues to expand financial assets (long-term card loans) based on its high-val-
ue customers. In addition, as part of the efforts to develop new businesses to diversify its revenue
base, Woori Card has been operating installment, lease and credit loan businesses since 2016,
while continuously expanding source of long-term income. As credit card merchant fees were
lowered, its profits decreased by KRW 95.6 billion in 2019. However, Woori Card overachieved its
initial target for net income (KRW 81.3 billion) with KRW 114.2 billion, thanks to financial asset ex-
pansions, cost-cutting efforts and non-recurring factors relating to the BC Card litigation.
Part 2. Business Management Rationalization
Woori Card endeavors to systematically respond to the evolving business environment. Woori
Card boosted focus on core functions and sped up decision-making processes by streamlining or-
ganization through functional readjustments among departments. Driven by dedicated Big Data
organization, Woori Card is also pressing ahead with ultra-personalized customer management
by advancing marketing efforts to a whole new level, reinforcing the loyalty of active members and
boosting the usage among inactive or dormant members. In addition, Woori Card established
a new digital marketing organization to respond to the changes in the digital finance ecosystem
such as the growth of simple payments.
2020 Plans
Overall business conditions for the credit card industry are expected to only worsen in 2020.
The pace of growth in the industry is predicted to slow amid contracted private consumption, a
near-mature credit card business environment, ever-rising household debt, lower merchant fees
and particularly because of universal recession triggered by COVID-19. Further threats are posed
by fiercer competition from other industries such as ICT companies expanding their business in the
payment and settlement market and online-only banks planning to launch credit card businesses.
In order to meet such changes head on, Woori Card sets the business goal of 2020 as “Securing
the Future Growth Engine through Innovation and Challenge”, under which the company has six
business strategies: Raising Value alongside Customers; Securing Sources of Income; Accelerating
Digital Innovation; Bolstering Risk/Compliance Monitoring; Expanding Group Synergy; and Firmly
Establishing the Foundation for Future Growth.
To this end, Woori Card plans to focus on boosting income by thoroughly managing the profitabil-
ity of each business and efficiently controlling costs. In addition, Woori Card will expand profitable
2017
2018
2019
assets mainly through high-value members by reinforcing data analytics and advancing marketing
efforts. Woori Card will also readjust portfolio to attract new members and improve cost structure.
Woori Card will secure the foundation to continuously create income by aggressively boosting the
efficiency of its business management: Woori Card will actively cut costs by raising company-wide
business efficiency; deploy ultra-personalized marketing driven by a dedicated Big Data organiza-
tion; and bolster asset soundness by thoroughly managing risk. Furthermore, in order to secure the
engine of new growth, Woori Card will make the utmost effort to align with the global networks of
Woori Bank and expand synergetic businesses with Group affiliates under Woori Financial Group.
Woori OverviewBusiness OperationsFinancial Review 074
WOORI
INVESTMENT
BANK
Woori Investment Bank is the only company in Korea fully dedicated
to total financial services with main business lines in deposits including
bills issued and CMA as well as loans and securities management.
Recently, Woori Investment Bank has been striving to diversify revenue base
by expanding its business scope to include NPL investments and IB, while
developing new sources of income through the synergy created
by Woori Financial Group.
Building a
Financial
Foundation
through Stable
Growth and
Innovation
Woori Investment Bank
is the only company in
Korea fully dedicated to
total financial services
Creating financial ecosystem
for innovative growth
Direct investments in
innovative growth
companies: 36 cases
Discovering IB business
opportunities overseas
Engaged in Binh Duong
New City development
project in Vietnam
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Investment Bank
075
Interest Income
(Unit: KRW in 100 millions)
601
498
YoY
+20.7%
2018
2019
Net Income
(Unit: KRW in 100 millions)
550
324
2019 Performance
Part 1. Boosting Fee Income through Bolstered IB, Diversifying Business Scope
Amid the trends of low interest rate and low growth, Woori Investment Bank bolstered the secu-
rities business in order to expand its proportion of fee income. Woori Investment Bank revitalized
IB business including deal management/arrangement/advisory services and reinforced organi-
zation and workforce in order to diversify revenue base through bonds management and acquisi-
tion/brokerage businesses. As a result, fee income in 2019 jumped 143 percent (KRW 18.4 billion)
year-over-year to KRW 31.3 billion (stand-alone basis).
Part 2. Reinforcing Management of Loan Soundness
As uncertainties in the financial environment continue to unfold, Woori Investment Bank is rein-
forcing management for the stability of loans. Woori Investment Bank is not only monitoring risk
management indicators and bolstering ex-ante reviews, but perform ex-post reviews through the
newly established Loan Review Department. In 2019, its ratio of substandard-or-below loans and
non-performing loans was 0.49 and 0.21 percent respectively, down 1.02 percent and 1.28 percent
respectively from last year.
2020 Plans
Woori Investment Bank has set its 2020 business goal as “Building a Financial Foundation through
Stable Growth and Innovation,” targeting a profit growth of 31 percent and asset expansion of 28
percent y-o-y. In particular, as the one and only financial investment subsidiary within the Group,
Woori Investment Bank is focusing efforts on expanding non-banking business in order to drive
towards Woori Financial Group’s goal of becoming the “No.1 Comprehensive Financial Group.”
YoY
+69.7%
2018
2019
In step with its plan to expand the loan business, Woori Investment Bank is pressing ahead with as-
Operating Income
(Unit: KRW in 100 millions)
555
320
YoY
+73.1%
2018
2019
set expansion mainly in reliably profitable assets. Woori Investment Bank is also pushing forward
loan transactions through businesses aligned with Woori Bank. Amid the continuing low interest
rate trend, Woori Investment Bank will also continue to boost non-interest income through fee
incomes generated by IB business and securities management/brokerage.
In the mid-to-long term, Woori Investment Bank plans to expand and raise creditworthiness. As
the nation’s only fully dedicated financial service provider, Woori Investment Bank is also reviewing
mid-to-long term development measures from multiple angles, taking into consideration market
changes and the Group’s portfolio.
Boosting Fee Income through
Bolstered IB
(Unit: KRW in 100 millions)
Woori Investment Bank’s
First Venture Capital
Fund
YoY
+143%
313
2019
129
2018
KRW
26 billion in size
Result of CIB collaboration within
Woori Financial Group
Woori OverviewBusiness OperationsFinancial Review 076
WOORI
FINANCE
INFORMATION
SYSTEM
'Clean Road 90'
Campaign
Establishing zero-defect IT
operation system to ensure
reliability of IT services
Woori FIS Co., Ltd. will drive Woori Financial Group’s conversion into a holding
company system and continue the expansion of its affiliates. It will reinforce
customer-centric marketing that leverages non-face-to-face channels and Big Data,
engaging in asset management with the use of new digital technologies and become
a leading bank in the foreign currency market. It will expand the global financial belt
and its global non-face-to-face channels and renew digital banking services with a
user-centric perspective and revitalize the mobile web, and lastly, it will maximize
its business competencies by using innovative digital technologies.
Woori FIS plans to concentrate organizational competencies on the stable operation
of next-generation systems; foster personnel and secure competitiveness to deploy
new digital technologies and launch new businesses for customers; secure global
service personnel and reinforce their competencies; affect change in the way it
works to enhance customer satisfaction; develop organization-centric IT services;
and acquire operational competencies.
2019 Performance
Under the 2019 business goal of “Securing Group IT Stability and Reliability,” Woori FIS focused en-
deavors on the three business strategies: a) Enhance Quality and Service Level; b) Bolster Efficiency
in the IT Operation System; and c) Boost Organizational and Specialized Competencies. Woori
FIS also focused on the six business tasks: a) enhance IT quality by optimizing IT and continuously
removing risk factors; b) provide timely support to Group businesses and procure site-tailored IT
services; c) bolster efficiency and competitiveness by improving the IT system and organization; d)
build the computing environment for end users in mind; e) rebuild the corporate culture (enhancing
organizational synergy); and f) secure competencies to support the continued growth of the orga-
nization.
2020 Plans
In 2020, Woori FIS has set three business strategies: a) (stability) IT Operations with Zero Interrup-
tion and Full Integrity; b) (innovation) Continued Reinforcement of the 2SP Business Management
Innovation; and c) (expansion) Expansion of IT-Business Convergence. Woori FIS also plans to focus
on nine business tasks: a) expanding the stability and availability of IT services; b) bolstering com-
petencies to protect information against ongoing security threats; c) advancing the IT compliance
and quality monitoring system; d) innovating IT service processes in a customer-centric manner; e)
innovating the system to optimize IT services; f) establishing an organizational culture of dedication
and respect; g) reinforcing R&D to leverage technologies; h) discovering IT-based businesses and
making preemptive proposals to customers; and i) expanding services based on IT competencies.
'IT and Business
Convergence'
2020 Business Goal
Business Strategy
STABILITY
INNOVATION
EXPANSION
IT Operations with
Zero Interruption and
Full Integrity
Continued Reinforcement
of the 2SP Business
Management Innovation
Expansion of IT-Business
Convergence.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Finance Research Institute
077
WOORI
FINANCE
RESEARCH
INSTITUTE
Woori Finance Research Institute (WFRI) was established in 2012 with the vision
of becoming the nation’s best think-tank specializing in finance and an insight
provider that spearheads financial development. In order to effectively support the
management in their decision-making processes, Woori Finance Research Institute
conducts in-depth research across all aspects of management strategies within
financial companies and within the economy and the financial market itself. Woori
Finance Research Institute is establishing itself as an opinion leader of Korean finance
by sharing the results of its research with customers, the authorities and financial
market participants.
2019 Performance
In 2019, WFRI published 330 reports with a focus on management strategies, risk management
and the discovery of new growth engines in pursuit of the stable growth of Woori Financial Group.
In response to the rapidly changing management environment, Woori Finance Research Institute
has decided that, in 2020, it will be concentrating efforts on digital finance research, consulting
services for subsidiaries and the group’s inside perspective on macro and financial variables. Fur-
thermore, in a bid to expand the group’s business portfolio, Woori Finance Research Institute plans
to bolster research on global financial companies for benchmarking purposes, non-banking indus-
tries and on the nations in which the Group has presence in.
Global
Leading Insight
Provider
Best Financial Think Tank in Korea
Research on
business strategies
of financial
institutions
Research on
financial policies
and regulations
Research on the
global financial
market and
financial industry
Analysis of
domestic and
international
economic trends
Opinion leader
of Korea’s financial
industry
Contributor to the
development of Korea’s
financial industry
Woori OverviewBusiness OperationsFinancial Review 078
WOORI
CREDIT
INFORMATION
Woori Credit Information’s main line of business is debt collection, credit
investigation and asset management. Woori Credit Information has solid
financial soundness with the smallest liabilities and largest assets among credit
information companies that are under financial holding companies in Korea.
Furthermore, it has reinforced independent business viability by securing
various business partners outside Woori Financial Group.
Woori Credit Information will secure the topmost position and lead the market,
driven by vigorous sales capacity and business management efficiency.
First credit
information
company in
Korea
01
Diversified and
specialized manpower
02
IT system of
perfection
03
Best financial
soundness in the
industry
04
Robust CSR activities
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Credit Information
079
2019 Performance
Part 1. Solid Financial Soundness
Woori Credit Information currently operates business with zero leverage and have maintained a
constant surplus ever since the founding of company. In addition, it is financially sound and has the
largest assets and the lowest debt ratio (26.6 percent) among all credit information companies that
Debt-to-Equity Ratio
(Unit: %)
Woori Credit Information
26.6
Company A
Company B
65.9
are under the wings of a financial holding company in Korea.
86.8
Category
Total Assets
Debt-to-Equity Ratio
(unit: KRW in 100 millions)
Company A
Company B
Woori Credit
Information
379
26.6%
253
65.9%
278
86.8%
Percentage of Revenue from
Non-Affiliates
(Unit: %)
Woori Credit Information
31.0
21.0
Company A
Company B
2.3
Part 2. Highest Level of Revenue from Non-Affiliates
One measure of sales capacity for credit information companies under the umbrella of financial
holding companies is the percentage of their revenue generated outside the holding company.
Woori Credit Information has proven its sales capacity with the highest percentage of revenue
from non-affiliates. It has secured various business partners outside the holding company and
boosted revenue by expanding the scope of business continuously through proactive marketing
efforts.
Category
Woori Credit
Information
Company A
Company B
Percentage of Revenue from Non-Affiliates
31.0%
21.0%
2.3%
2020 Plans
Woori Credit Information’s business goal this year is “Venturing into New Markets, Managing Busi-
ness Based on Internal Robustness.” It aims to achieve this goal based on the following systematic
and efficient management strategies.
First, “Venturing into New Markets.” It will concentrate its efforts toward discovering new engines of
growth and diversifying sources of income in order to overcome the harsh business environment
and to continue growth. It will also expand customer base by attracting more business partners.
Second, “Maximizing Efficient Management.” Woori Credit Information will maximize efficiency in
its business management based on a profitability analysis of each segment by efficiently manag-
ing the organization and personnel, simplifying work, building a new system, saving non-essential
expenses, and bolstering the competencies of workforce.
Third, “Customer-Centric, On-Site Business Management.” Woori Credit Information will earn sup-
port from customers and gain competitiveness by prioritizing customers and providing them with
differentiated, tailored services that meet their needs.
Lastly, “Stronger Support Policies for Debtors.” In step with government policies to boost support
for the socially vulnerable, Woori Credit Information will boldly push forward measures to revitalize
debt adjustment to the benefit of both debtors and Woori Credit Information. Furthermore, Woori
Credit Information will fulfill social responsibility by bolstering ethical management through legiti-
mate debt collection and reinforced individual credit information.
Woori OverviewBusiness OperationsFinancial Review
080
WOORI
FUND
SERVICE
Administrative
management services
for KRW 110 trillion of
assets
Specialized adminis-
trative management
company with best-
in-class system
Woori Fund Service is a specialized administrative management company
equipped with a best-in-class system that provides various administration
services including fund accounting and reference price computation for
collective investment vehicles. Woori Fund Service is also increasingly being
recognized as a powerhouse in handling general administration for real estate
investment trusts, or REITs. Woori Fund Service endeavors to become a better
service provider by stabilizing services with its new DRS system and through
minimizing errors through stringent internal controls.
2019 Performance
Woori Fund Services commenced administrative management services for Woori Asset Manage-
ment, which was incorporated as a subsidiary of Woori Financial Group in August 2019. Its System
advancement process proceeded for six months from October 2019, involving data relocation and
customized services for asset management companies. As a result, it now provides administrative
management services for assets amounting to KRW 110 trillion. Woori Fund Service will also initiate
administrative management services for Woori Global Asset Management in September 2020. Woori
Fund Service believes this will create great synergy with asset management companies under the
wings of Woori Financial Group, and will actively deploy marketing initiatives on their behalf.
2020 Plans
Recent improvements (cut-off) on the fund reference price computation scheme will be applied to
the system, which will enable a sooner completion of the computation and contribute to the stabiliza-
tion of this industry.
Moreover, Woori Fund Service plans to file for a patent application on the (tentatively called) “Man-
agement Direction Forwarding Service,” developed to remove risks from the reference price com-
putation. The Management Direction Forwarding Service enables the IT system to automatically
notify whether management directions from asset management companies have been received or
processed. This means that issues with manual processing can be prevented in advance. Woori Fund
Service also aims to enter into the insurance industry based on bolstered business competitiveness
by computing reference prices for variable insurance, building an IFRS system and developing an
accounting system for REITs. In addition, it plans to press ahead with global business linked with its
affiliates at Woori Financial Group beginning in the Asian region.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Asset Trust
081
WOORI
ASSET
TRUST
Woori Asset Trust is a comprehensive real estate financing company that
Woori Financial Group newly acquired in 2019. On the basis of experience
and customer trust cumulated over nearly 20 years, Woori Asset Trust pushes
forward continued growth with over KRW 30 trillion in entrusted assets. Woori
Asset Trust will provide the complete financial services for the Group to become
the No.1 comprehensive real estate financing company with an excellent
customer satisfaction track record by managing customer assets in a safe but
highly profitable manner.
2019 Performance
Since its incorporation into the Woori Financial Group as of December 30 2019, Woori Asset Trust
has restructured its organization under the leadership of the current co-CEOs, aiming to invigo-
rate synergetic effects created by the “business management sector” and the “business promo-
tion sector”.
Despite the industry-wide recession, market impact and financial strain on Woori Asset Trust were
both limited as business has a low percentage of loan-type land trusts that are high-risk in nature.
Woori Asset Trust was able to generate stable profits by gradually expanding its proportion of
management-type land trusts backed by completion guarantees, based on its existing strength in
collateral trust, agency business and other areas that are relatively less sensitive to fluctuations in
the real estate market.
Company
Woori Asset Trust
Korea Trust
Hana Asset Trust
KB Real Estate Trust
Kyobo Asset Trust
Asia Trust
Mugunghwa Trust
Daehan Real Estate Trust
Korea Asset Investment Trust
Korea Real Estate Investment and Trust
KORAMCO REITs and Trust
(unit: %, KRW in millions)
ROE(%)
ROA(%)
Net Income
36.4
28.1
26.7
23.4
22.7
21.9
21.0
13.9
13.8
11.8
8.3
24.5
20.7
17.1
18.4
18.0
16.5
11.8
5.1
7.6
7.0
3.9
31,122
25,361
65,701
61,713
26,473
25,409
18,745
37,078
79,598
90,737
21,629
Note: Data from Korea Financial Investment Association E-Disclosure Service
(As of Dec. 31 2019, 11 existing companies)
2020
Pursuing Revenue
Diversification through
Internal Robustness
REITs Brand
Reputation Index No.3
Seeking reapproval as REITs AMC
Woori OverviewBusiness OperationsFinancial Review 082
Operating Income
KRW
41.15 billion
YoY
+0.34%
Profitability
ROE
ROA
36.4%
24.5%
2020 Plans
Goal for this year is “Building Reliable Total Real Estate Finance,” and Woori Asset Trust plans to
carry out strategies accordingly on “building a stable system”, “diversifying the revenue base”, and
“revitalizing Group synergies”.
In the mid-to-long term, Woori Asset Trust will seek out opportunities to venture into new busi-
nesses by hiring outstanding talent (discovery), ensuring consistency in management policies
through Group-level business administration and risk management (bolstering internal robust-
ness), and building stable business capacity (scaling out externally).
Detailed business strategy for this year is as follows:
Build a Stable System through Organizational Restructuring
(including New Set-Ups)
· Establish a Business Planning Department to build a growth engine for promoting new business
by reinforcing capacity in strategic planning and financial management.
· Appoint a Risk Management Officer to an executive position (with a new, dedicated subordinate
organization) to bolster internal and external risk management as well as internal controls. Im-
prove the process of the entrustment system to take on trust businesses more selectively.
· Appoint a Compliance Officer to an executive position (with a new, dedicated subordinate organi-
zation) to firmly establish a spirit of compliance and ethical management. Conduct a regular train-
ing program to reduce and prevent litigation.
Diversifying the revenue base
· Expand market share by quickly securing management-type land trusts backed by completion
guarantees in stable businesses, based on heightened credibility from being incorporated into
Woori Financial Group.
· Pursue small redevelopment projects in the metropolitan area by winning the small scale recon-
struction project for the Daeheung Townhouse near Namguro Station, Seoul
· Allocate essential personnel and secure a larger space to be reapproved as a REITs asset manage-
ment company within the year
Revitalize Group synergies
· Promote synergy through collateral trust and land trust businesses aligned with PF loans (includ-
ing introduction) extended by Woori Bank, etc.
· Promote the development of the Group’s available, unused real estate for youth housing and
other government policy projects.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 WOORI
ASSET
MANAGEMENT
AUM
KRW 19.1 trillion
Net Income
KRW 8 billion
2019
Market Share
1.57%
Woori Asset Management
083
Woori Asset Management is a comprehensive asset management company
that carries out fund management, investment advisory business, discretionary
investment and additional lines of business. On top of managing the three
leading publicly offered bond funds – Woori High Plus Bond Fund, Woori
High Plus Short Duration Blue Chip Bond Fund and Woori Short-Term Bond
Fund – Woori Asset Management is entrusted to manage discretionary funds
by multiple institutions including pension companies, insurers, banks and
mutual aid associations. Woori Asset Management is also gaining substantial
recognition with stock funds including index funds, small-mid high dividend
funds and Samsung Group stock funds.
2019 Performance
As of end of 2019, in net asset value (NAV) terms, Woori Asset Management is entrusted to man-
age KRW 19.1 trillion, around the same level as was at the end 2018, and it realized a net income
of KRW 8 billion. In terms of assets under management (AUM), market share was 1.57 percent,
2.3 percentage points down from the 1.80 percent at the end of 2018. Breakdown of key changes
revealed that the AUM of stock funds grew by KRW 223.9 billion (up 17.4 percent y-o-y) and that of
bond funds dropped by KRW 258.3 billion (down 1.8 percent q-o-q).
Category
(unit: KRW in 100 millions)
End of
Dec. 2019
End of
Dec. 2018
End of
Dec. 2017
AUM of Woori Asset Management
191,346
191,367
213,760
AUM Total
Market Share
12,151,476
10,608,562
10,280,506
1.57%
1.80%
2.08%
(Source: Korea Financial Investment Association, funds+discretionary funds, NAV)
With interest rates on a constant decline, the AUM of domestic bond funds spiked up its YTD figures
through August. Since then, however, interest rates have rebounded and investors have withdrawn
their money from bond funds. Publicly offered bond funds underperformed as they are short-
er-lived than competing funds as a result of going after a “bank rate plus mark-up” yield. Private eq-
uity bond funds, on the other hand, are performing solidly, under stable management that meets
the needs of institutional beneficiaries.
For stock bonds, Woori Asset Management adopted a new management method focused on re-
sponsible investment and applied a Quant Model in pursuit of alpha. As a result, stock bonds are
performing better, realizing a healthy yield well above the benchmark.
The Global Investment Management Unit, established on October 21 2019, will boost competitive-
ness by broadening the product line-up that meets the market needs. Woori Asset Management
launched the Global EMP Asset Allocation Fund and is preparing a TDF (Target Date Fund) to raise
its market share in retirement pensions. It also seeks to regain investors’ trust by pushing up yields
on Chinese and Vietnamese funds.
Woori OverviewBusiness OperationsFinancial Review
084
Net Income
KRW
8 billion
YoY
+33.3%
Operating Income
KRW
10.2 billion
YoY
+21%
2020 Plans
Business goal for 2020 is reliable management with highest priority on customers’ yield. Under
this goal, Woori Asset Management expects to increase net income by 19.5 percent to KRW 10.4
billion and add a face value amount of KRW 4.3 trillion to its AUM. Under this goal, Woori Asset
Management is aggressively promoting specific tasks that include diversifying new sales channels,
expanding new product line-ups, advancing a research-based management process and perfor-
mance evaluation system, bolstering preemptive risk management and creating synergetic effects
with Group affiliates.
Woori Asset Management foresees an annual average growth rate of around 5 percent for con-
ventional stock and bond funds. Previously, it managed to achieve market-level growth, mainly
through bond funds. This type of growth, however, is no longer viable as interest rates remain low
and the market share of bond funds has reached its maximum level. As such, Woori Asset Manage-
ment aims to overcome somewhat limited recognition resulting from its focus on handling small
and mid-cap stocks by expanding market share in the large-cap stock market to equip itself with a
new engine for growth.
In 2020, Woori Asset Management will also bolster synergetic effects with the holding company.
Woori Asset Management will promote joint marketing efforts for key products including MMFs
for individual investors and bond funds by reinforcing affiliated sales with Woori Bank. It will also
provide “tailored” products to CIB and WM customers. In addition, Woori Asset Management
plans to boost Group collaboration to prepare for the introduction of the trust-based retirement
pension scheme and also develop new products by collaborating with IB. It also aims to fully step
into the role of being a Solution Provider and develop solution products and TDF products that
meet the needs of investors.
Outstanding Excellence
in Domestic Bond Funds
KG Zeroin Korea Fund Awards
Feb. 12, 2019
Best Fund in
Domestic Bonds Category
Maekyung Securities Awards
Feb. 21 2019
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Woori Private Equity
Asset Management
085
The private equity business continues to grow as key investment institutions
enlarge their alternative investments and private capital assumes a larger role
in the restructuring and M&A market. Woori Private Equity Asset Manage-
ment is a first generation private equity fund management company in Korea
that was established in October 2005. In July 2016, the company expanded its
business scope by adding the management of hedge funds (“alternative invest-
ment” henceforth) to its existing business of managing private equity funds
(“PEF” henceforth), thereby contributing to Woori Financial Group’s scale-out
in the IB sector as the private equity asset management company of the Group
Woori Private Equity Asset Management will continue quantitative and qual-
itative growth as a PEF management company that leads the industry by pre-
senting the best investment value and realizing customer satisfaction.
2019 Performance
In 2019, Woori Private Equity Asset Management achieved quantitative and qualitative growth
by discovering and promoting various investment businesses under the goal of maximizing fund
management performance and expanding the scope of its business. As the company was selected
to undertake fiduciary management for KDB and Korea Growth Investment Corp, the PEF Depart-
ment accordingly built two blind funds – one at the end of 2018 (Woori-Shinyoung Growth-Cap
Private Equity Fund I, KRW 163 billion) and another in May 2019 (Woori-Q Corporate Restructuring
Private Equity Fund, KRW 155.1 billion). It then went on to execute four investments in the excellent
investees it discovered. The Asset Management Department ventured out of mainly investing in
domestic SOC projects and expanded into the overseas development infrastructure, overseas real
estate and innovative growth support funds, further boosting its profitability.
Part 1. Successful Investment Executions by the PEF Department
The PEF Department manages three funds as of end of 2019, with a total capital commitment of
KRW 361.6 billion. In 2019, main focus was executing investments for the two existing blind funds.
In particular, for the Woori-Shinyoung Growth-Cap Private Equity Fund I, which was developed
as Woori Private Equity Asset Management and which became the fiduciary manager for KDB, it
executed investments selectively in enterprises with technological prowess and growth potential.
The department did so in various sectors that encompass advertising media, real estate platforms,
security and anti-wiretapping device manufacturing, while generating outstanding investment
performance by enhancing the value for investees. Furthermore, 60.3 percent of the total capital
commitment was executed at the end of March 2020. Such remarkable records in carrying out in-
vestments laid the foundation to foster more blind funds going forward.
WOORI
PRIVATE
EQUITY ASSET
MANAGEMENT
The Most
Value-Creating Equity
Provider
15 Alternative
Investment Funds
under Management
KRW 1.2 trillion
in accumulated
commitments
(As of end-2019)
Woori OverviewBusiness OperationsFinancial Review 086
Total Capital Commitments
in PEF
KRW 362 billion
Part 2. Expansion of Diverse Investments Driven by Stability and Profitability
The Alternative Investment Department manages 15 funds as of end of 2019, with accumulated
commitments reaching KRW 1.1972 trillion.
In 2019, profitability was improved as the department successfully diversified its business by ex-
panding overseas investments that display both stability and profitability, and the average rate of
the management fees climbed 119.2 percent year-on-year. Moreover, as it ensures thorough man-
agement of ex-ante and ex-post risks, not a single investment has incurred a loss since the launch
Growth of Average Rate
of Management Fees
YoY
+119.2%
2019
2018
of the business.
2020 Plans
Woori Private Equity Asset Management will continue to grow in quantitative and qualitative terms
in 2020, with the aim to leap towards becoming the industry-leading asset management company
by offering the best investment value and customer satisfaction.
The PEF Department will maximize return on investment by enhancing the values of investees that
compose the portfolio of the two blind funds, while making more investments to generate the best
results. In addition, it will secure position as a leading player that drives the domestic PEF market
by pushing ahead to foster another blind fund of around KRW 300 billion in volume by attracting
investments from major institutions.
The Alternative Investment Department plans to broaden assets under management by discov-
ering new businesses to invest in, including overseas infrastructure and real estate. The depart-
ment will also produce stable investment performance with the existing business by thoroughly
managing investment ex-post. The Alternative Investment Department also plans to foster a new
fund amounting at around KRW 300 billion, which will bring accumulated commitments to KRW 1.5
trillion within 2020.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 WOORI
GLOBAL ASSET
MANAGEMENT
Woori Global Asset
Management
087
Woori Global Asset Management started off as Allianz Global Investors and
grew into a global asset management company with approximately KRW 9
trillion in assets under its management at the end of 2019. Woori Global Asset
Management became an affiliate of Woori Financial Group in December 2019.
On top of its existing strength in stocks, bonds and overseas fund of funds,
the company broadened its business scope into the alternative investment
market by establishing the Global Investment Unit and Alternative Investment
Unit to handle investments in infrastructure, real estate and acquisition
financing. Woori Global Asset Management believes that the best way to gain
a competitive edge in the market begins by truly understanding the big
picture. Woori Global Asset Management leaves no stone unturned in doing
its utmost to fully understand the needs of both the market and its customers,
and based on the solid foundation and global networks of the Woori Financial
Group it presents customers with best-in-class management competencies
and competitive investment solutions.
Sustainable
2019 Performance
Smart
Investing
Multilateral
In 2003, Woori Global Asset Management launched the very first fund of funds in Korea, that was
based on the sophisticated asset management methodologies of the German Allianz Group,
that invested overseas. Since then, Woori Global Asset Management has been spearheading the
market by taking the lead in launching a wide range of overseas investment products. In 2019,
the company expanded product line-up in step with customer demand by launching USD-de-
nominated overseas bond funds and unhedged funds, firmly entrenching its leadership position
in overseas bond funds. Furthermore, it broadened strategic partnerships with reputable asset
management companies overseas by launching the Woori G. Artisan Global Opportunities Fund in
late 2019 with Artisan Partners - a US company with a stellar track record in global stock asset man-
Responsible
agement.
Moreover, as the alternative investment market has recently been posting rapid growth, Woori
Global Asset Management selected alternative investments as a new growth business and estab-
lished the Global Investment Unit and Alternative Investment Unit. They focus on preemptively
discovering investment opportunities in reliably profitable alternative investment assets, in Korea
and abroad, from which they can expect value appreciation and consistent yields. To this end, the
Global Investment Unit and Alternative Investment Unit reinforced operation systems and sourc-
ing channels and also developed and launched products in the fields of domestic and overseas
acquisition finance, real estate and infrastructure.
Transparent
Woori OverviewBusiness OperationsFinancial Review 088
AUM
KRW 8.7 trillion
2020 Plans
Woori Global Asset Management aims to provide investment products that guarantee reliable in-
come for customers based on specialized and accurate in-house research and operation system as
well as its sophisticated risk and compliance monitoring systems.
As an affiliate of Woori Financial Group, Woori Global Asset Management will strive to actively
present the best investment solutions to all individual, corporate and institutional customers of
the Group and generate synergy in multiple fields with other Group affiliates including through
aligned business and combined product development.
In stocks, Woori Global Asset Management promotes a bold kind of management driven by
fundamentals and corporate value analysis that is based on in-house research and targets mid-
to-long term results. The company is building competitive asset management and risk manage-
ment systems to maintain stable performance in managing domestic general stock funds and
small-and-medium cap funds, while developing new products to diversify investments into over-
seas markets.
In bonds, Woori Global Asset Management strives to build a system that can further stabilize as-
set management and achieve outstanding risk-adjusted return. In the institutional discretionary
sector, it will bolster collaboration with the marketing unit in order to boost AUM and also enlarge
MMF net asset value through stable management.
In global and alternative investments, its goal is to become a reliable asset management company
specializing in overseas funds. To help achieve this, the company will reinforce strategic part-
nerships with reputable asset management companies overseas and enhance the quality of its
management process and communications with customers for launched products. Furthermore,
based on its global networks in relation to alternative investments, the company will develop vari-
ous alternative investment products in the fields of domestic and overseas real estate, infrastruc-
ture, aircraft finance and acquisition finance on top of existing focus on stock funds and bond fund
of funds.
Risk Management Process
Risk Management Committee
Risk Management Team
Management Team
Decision making
Review of risks, Sharing of data
Report
Submission of explanatory
statement, Approval of violation
Establishes risk management
policies and makes decisions
Monitors for violations of risk
management regulations
Manages funds in compliance with
risk management guidelines
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 089
FINANCIAL
REVIEW
Management’s Discussion and Analysis
Separate Financial Statements
Consolidated Financial Statements
Global Network
090
120
168
319
Woori OverviewBusiness OperationsFinancial Review 090
MANAGEMENT’S DISCUSSION AND ANALYSIS
1. Disclaimers on Forecast Information
Activities, events or phenomena that are expected and predicted to occur in the future in this annual report for Woori Financial Group Inc. reflect
the company’s thoughts and opinions on the events and financial performance at the time when this document was prepared for disclosure in the
same term. The forecast information is based on diverse assumptions associated with the future business environment, and, consequently, such
assumptions may be judged to be inaccurate in the future. Moreover, the assumptions include risks, uncertainties and other factors that might cause
critical differences between estimated outcomes in the forecast information indicated here and the actual outcomes. Factors that might induce such
critical differences encompass factors related to internal corporate management and those related to the external environment, and include other
wide-ranging factors.
Woori Financial Group has no obligation to disclose a revised report with corrections on matters prescribed in the forecast information in order to
reflect risks or uncertainties that might occur after the preparation of the forecast information.
In conclusion, Woori Financial Group cannot confirm the realization of expected results or matters forecast by the Group or the occurrence of any
impacts projected in this business report. Forecast information prescribed in this report is current as of the time the report was prepared. Please note
that Woori Financial Group has no plan to provide updates on such risk factors or forecast information. Furthermore, it should be noted that even
under such circumstances, the forecast data shall not be used as evidence for legal responsibility regarding investment outcomes for customers.
2. Overview
After establishing Woori Financial Group, Inc. on January 11 2019, Woori Financial Group Inc. acquired two asset management companies (Woori
Asset Management Corp. and Woori Global Asset Management Co., Ltd.) and a real estate trust company (Woori Asset Trust Co., Ltd.). In addition,
Woori Card Co., Ltd. and Woori Investment Bank Co., Ltd., which were subsidiaries of Woori Bank, were incorporated as Group subsidiaries, widening
the business portfolio and solidifying the Group system.
Four percent of the shares in mutual ownership issued in the process of launching the holding company and incorporating subsidiaries were sold to
Fubon Life Insurance – a Taiwanese major financial company. As such, despite harsh financial conditions, Woori Financial Group was able to complete
the selling of shares, driven by thorough preparation and aggressive endeavors to attract investors, shedding any issues regarding share overhang and
stabilizing the Group’s governance. Furthermore, Woori Financial Group purchased the Woori Financial Namsan Tower across the street from the main
office building of Woori Bank. Some of the Group affiliates have relocated to the Tower, giving impetus to building the “Namsan Woori Financial Town.”
In terms of financial performance, Woori Financial Group Inc. realized a net income of KRW 2.0038 trillion on a consolidated basis in 2019 (Net Income
Attributable to Controlling Interests: KRW 1.8722 trillion).
In 2019, the business environment in the financial industry was generally strained in general as the US-China trade conflicts continued, on, triggering
a global recession and causing central banks in the US and other nations to lower interest rates, which also pushed down market rates. Nevertheless,
Woori Financial Group realized strong performance with an improved profit structure by growing assets, mainly in reliably profitable corporate loans
and expanding core deposits, while further enhancing asset soundness, that which was already one of the best in the industry.
In terms of profitability, the decline in market rates and fiercer competition for deposits brought on by the new LDR rule pushed down NIM (0.10%p on
the Group basis, 0.08%p on the Bank basis). Even so, a balanced growth of financially sound corporate loans and household loans bolstered interest-
bearing assets, as net interest income climbed 4.3% over the previous year (2018 Woori Bank consolidated basis, same applied henceforward)
to KRW 5.8937 trillion. Non-interest income dropped 1.3% y-o-y to KRW 1.0466 trillion, but net fees and commissions income, which is core non-
interest income, stood at a solid KRW 1.1026 trillion, mainly driven by the asset management business. General and administrative expenses slightly
movedinched upwards due to general expenses during the initial stage of establishing the holding company and wages for new subsidiaries. Going
forward, however, the CI ratio will be robustly managed with efficient channels and business strategies.
In asset quality, Woori Financial Group recorded an NPL ratio of 0.45% and delinquency ratio of 0.33% on the Group basis – the lowest level in the
industry. This was possible as Woori Financial Group improved portfolio by boosting the share of financially sound assets and by proactively writing off
bad debt and preemptively managing risk to restrain non-performing loans.
In terms of capital adequacy, Woori Financial Group applies the standardized approach in calculating capital adequacy ratios, this being its first year as
a holding company. At end-2019, BIS total capital ratio of the Group was 11.89%, which was above the regulatory requirement of 10.5%. Woori Financial
Group is also strenuously actively striving to enhance capital adequacy by issuing capital securities and boosting high-quality assets. At present, review is
underway for the approval of the internal ratings-based (IRB) approach. In October 2019, major subsidiary Woori Bank acquired the approval to switch to
the IRB approach. The capital adequacy ratio is expected to be enhanced once Woori Financial Group Inc. acquires the said approval.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 091
Meanwhile, as the growth of the domestic financial market becomes stagnant, there is an increasing need to diversify the revenue base by making
inroads into overseas markets. At the end of 2019, the Group owned a total of 474 global networks in 23 nations and is still aggressively actively
venturing into other markets. Endeavors to boost global businesses with an aim to restructure domestic-centered revenue base led to a global
business net income of KRW 224 billion, a 15.8% increase y-o-y, accounting for more than 10% of total profits. In step with the growth of digital finance
in Southeast Asia, Woori Financial Group will further advance locally specialized mobile banking services and accelerate qualitative growth based on
global risk management.
Key Management Indicators
Category
B/S
I/S
Total Assets (Including AUM)
Total Assets (Excluding AUM)
Loans in KRWNote 1)
Net Interest Income
Net Fees & Commissions Income
Other Operating Income
Operating Income
Net Income
Management Indicators
ROA
Including Non-Controlling Interests
Net Income Attributable to Non-Controlling Interests
Net Income Attributable to Controlling Interests
Excluding Non-Controlling Interests
ROE
Including Non-Controlling Interests
Excluding Non-Controlling Interests
NPL Ratio
BIS Total Capital RatioNote 2)
(Unit: KRW in billions, %)
At End-2019
473,794
361,981
221,687
5,894
1,103
430
△
2,800
2,038
165
1,872
0.57
0.52
10.11
9.29
0.45
11.89
Note 1) Based on consolidated financial statements
Note 2) Based on standardized approach
Note 3) Net fees and commissions income: Fees and commissions income in KRW + Note 4) Other operating income: gain (loss) on insurance + gain (loss) on Valuation & Disposi-
tion of Securities + gain (loss) on Valuation and Disposal of Loan + gain (loss) on foreign exchange + gain (loss) on derivatives + provision for/reversal of credit loss reserve
+ provision for/reversal of allowances + dividend income and commissions income in foreign currency + fees and commissions income related to credit cards + fees and
commissions income related to securities + fees and commissions income related to leases + fees and commissions income related to brand usage + fees and commissions
income related to trust
Note 4) Other operating income: gain (loss) on insurance + gain (loss) on Valuation & Disposition of Securities + gain (loss) on Valuation and Disposal of Loan + gain (loss) on foreign
exchange + gain (loss) on derivatives + provision for/reversal of credit loss reserve + provision for/reversal of allowances + dividend income
Although 2020 started off with expectations of an economic recovery, the outlook for both the economy in general and the financial industry is dismal,
due to the unexpected COVID-19 outbreak. It seems that recovery will all depend on when the outbreak subsides, but concern of another global
recession is looming as the World Health Organization has recently declared COVID-19 a pandemic. The Federal Reserve lowered its benchmark
interest rate to 1.5%, subsequently, and many other nations are rolling out liquidity expansion policies, which are likely to take a toll on the profitability
of banks. In addition, the creation of an innovate digital finance environment by open banking services or third-party online-only banks indicate that
Woori Financial Group faces ever fiercer competition with not only other financial institutions but with ICT companies.
Provided, Woori Financial Group plans to solidify existing business prowess by presenting customer-centric comprehensive financial solutions and
spearhead changes and innovations in new areas such as digital finance, thereby proactively discovering new growth engines. Moreover, in the
second year into the Group system, Woori Financial Group will continue to carry out strategic M&As with capital banks, savings banks and securities
firms to expand non-banking lineup. Woori Financial Group will also create synergy by bolstering the competitiveness of newly incorporated
subsidiaries and boosting collaboration among Group affiliates, in order to discover new business opportunities.
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
092
3. Financial Position & Business Performance
A. Financial Position & Business Performance
(1) Growth
1) Woori Financial Group Inc.
Category
Total Assets (Including AUM)
Total Assets (Excluding AUM)
Loans in KRW
Loans in Foreign Currency
Marketable Securities
Credit Card Receivables
(Unit: KRW in billions)
At End-2019
473,794
361,981
221,687
26,206
53,764
8,399
Note 1) Based on Group consolidated financial statements
Note 2) Loans in KRW: Inclusive of inter-bank loans
Note 3) Loans in Foreign Currency: Loans in foreign currency + domestic import usance bills + bills bought, inter-bank loans in foreign currency
Note 4) Marketable Securities: Marketable securities + investment in subsidiaries + marketable securities credit loss reserve
At end-2019, the Group’s total assets (including AUM) stood at KRW 473.8 trillion, growing by KRW 79.3 trillion (or 19.9%) since first disclosure
as a holding company at the end of March 2019. Of this growth, newly incorporate subsidiaries (Woori Asset Management, Woori Global Asset
Management, Woori Asset Trust) accounted for KRW 55.6 trillion.
At the end of 2019, on the Group basis, loans in KRW stood at KRW 221.7 trillion, loans in foreign currency at KRW 26.2 trillion, and marketable
securities at KRW 53.8 trillion.
2) Woori Bank
Category
Total Assets
Loans in KRW
Corporate Loans
Household Loans
Public and Other Loans
2019
End of the (current) 186th term
2018
End of the (previous) 185th term
Change (amount)
Change (%)
(Unit: KRW in billions)
348,182
219,910
97,080
119,720
3,110
340,447
211,065
93,856
113,704
3,505
7,734
8,845
3,224
6,016
395
△
2.27%
4.19%
3.43%
5.29%
11.27%
△
Note) Based on consolidated financial statements of Woori Bank
Woori Bank – a major subsidiary of the Group – posted total assets of KRW 348.2 trillion at end-2019 (consolidated basis), which is KRW 7.7 trillion
larger than the year before (2.27% growth). The main driver was the growth of loans in KRW by KRW 8.8 trillion (or 4.19%) y-o-y. Meanwhile, corporate
loans increased by KRW 3.2 trillion and household loans by KRW 6 trillion, with each asset category assuming a similar share out of total as the year
before. Woori Bank will continuously implement balanced asset growth strategies in 2020, taking into account risk management and profitability.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
3) Financial Information of the Major Subsidiaries
(Unit: KRW in millions)
093
Category
Woori Card
Woori Investment Bank
Woori Asset Trust
Woori Asset Management
Asset
Liability
Equity
Asset
Liability
Equity
Asset
Liability
Equity
Asset
Liability
Equity
At end-2019
At end-2018
10,087,342
8,299,175
1,788,167
3,398,960
3,031,622
367,338
139,839
45,410
94,429
112,781
6,017
106,764
9,987,400
8,305,436
1,681,964
2,682,660
2,367,418
315,242
113,786
37,333
76,453
101,536
3,824
97,712
Note) Woori Card/Woori Investment Bank: Based on K-IFRS consolidated financial statements, Woori Asset Trust/Woori Asset Management: Based on K-IFRS separate
financial statements
Woori Card saw an increase of around KRW 100 billion in total assets, driven by greater usage of credit cards and financial assets on a broader
revenue base.
Credit card usage is increasing, driven by a growing membership pool, aligned business with Woori Bank and a bold entry into the simple payment
market. Woori Card also continues to expand its financial assets (long-term card loan) based on high-value customers. In addition, as part of efforts to
develop new businesses to diversify the revenue base, Woori Card has been operating installment, lease and credit loan businesses since 2016, while
continuously expanding its sources of long-term income within the regulatory leverage ratio (600%) of credit card companies.
Woori Investment Bank recorded total assets of KRW 3.4 trillion at end of 2019, which is KRW 0.7 trillion (or 26.7%) higher than the previous year. The
growth was mainly attributable to continued increase of financially sound loan transaction partners and to affiliated business with Woori Bank, in
accordance with the plan to expand the loan business. Consequently, loans in KRW surged by KRW 380.1 billion (or 46%) y-o-y. Woori Investment
Bank also took on bonds management in full-swing, recording a KRW 487.3 billion (or 90.2%) growth y-o-y in public bonds and financial bonds. Woori
Investment Bank will continue to roll out balanced asset growth strategies, taking into account risk management and profitability.
As of end-2019, Woori Asset Trust has KRW 27.5 trillion in assets under management, which is KRW 3.9 trillion higher than the year before, in terms
of the face value amount. Total assets stood at KRW 139.8 billion, recording a y-o-y growth of KRW 26 billion (or 23%). In 2019, real estate regulations
were reinforced and the economy was in a downturn, which pushed up the volume of unsold new property developments. As a result, new order
placements in the industry generally declined, as major companies with main lines of business in loan-type land trust downsized their businesses
amid surging bad debt write-offs and widespread risks. On the other hand, as Woori Asset Trust focuses on non-loan type products, including
management-type land trust, collateral trust and agency business, its new order placement and revenue increased in 2019. On top of its solid business
foundation, Woori Asset Management plans to build the framework for full-fledged growth as a subsidiary of the Woori Financial Group Inc. by
venturing into the business of management-type land trusts backed by completion guarantees. In the mid-to-long term, Woori Asset Management
also aims to continue its growth trend by developing new businesses.
As of end of 2019, in net asset value (NAV) terms, Woori Asset Management is entrusted to manage KRW 19.2 trillion, which is similar to the 2018
year-end level. With the interest rates falling since 2019, AUM in domestic bond funds increased, but as interest rates climbed since August, the
competitiveness of bond-type products has weakened and AUM therein declined. As market volatility grows, Woori Asset Management will expand
its new lineup of MMF, index and EMP products, thereby facilitating the inflow of funds from institutional investors and private equity. Woori Asset
Management set the goal of boosting the AUM by KRW 4.3 trillion in its face value amount. To this end, Woori Asset Management is diversifying
new sales channels, expanding its new product line-up, advancing research-based management processes and performance evaluation systems,
bolstering preemptive risk management and creating synergetic effects with Group affiliates.
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
094
Total Assets (including AUM) of Affiliates
Category
Group
Woori Bank
Woori Card
Woori Investment Bank
Woori FIS
Woori Finance Research Institute
Woori Credit Information
Woori Fund Service
Woori Asset Trust
Woori Asset Management
Woori PE
Woori Global Asset Management
Note1) Woori Bank, Woori Investment Bank: Based on consolidated financial statements
(2) Profitability
1) Woori Financial Group Inc.
Category
Net Interest Income
Net Fees and Commissions Income
Other Operating Income
General and Administrative Expenses
Operating Income
Non-Operating Income(Expense)
Net Income before Income Tax Expense
Income Tax Expense
Gain (Loss) on Discontinued Operations
Net Income
Total
Net Income Attributable to Non-Controlling Interests
Net Income Attributable to Controlling Interests
(Unit: KRW in billions)
At End-2019
473,794
403,914
10,087
3,399
91
5
38
17
27,651
19,248
811
8,696
(Unit: KRW in billions)
2019
5,894
1,103
430
△
3,766
2,800
77
△
2,723
685
-
2,038
165
1,872
Note 1) Net fees and commissions income: Fees and commissions income in KRW + fees and commissions income in foreign currency + fees and commissions income related to
credit cards + fees and commissions income related to securities + fees and commissions income related to leases + fees and commissions income related to brand usage +
fees and commissions income related to trust
Note 2) Other operating income: gain (loss) on insurance + gain (loss) on Valuation & Disposition of Securities + gain (loss) on Valuation and Disposal of Loan + gain (loss) on foreign
exchange + gain (loss) on derivatives + provision for/reversal of credit loss reserve + provision for/reversal of allowances + dividend income
Although the base rate was lowered twice this year (July and October 2019), Woori Financial Group Inc. realized a total net income of KRW 2,038
billion in 2019, or KRW 1,872 billion when excluding net income attributable to non-controlling interests, based on the improvement of profit
structure and the reversal of credit loss expenses.
The net interest income amounted to KRW 5,894 billion, net fees and commissions income to KRW 1,103 billion and operating income after
credit loss expenses and general and administrative expenses to KRW 2,800 billion. Pursuant to the conversion into a holding company
structure, net income attributable to non-controlling interests of KRW 165 billion is reflective of dividends to hybrid securities.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
2) Woori Bank
Category
I. Operating Income
Net Interest Income
Non-Interest Income
Net Fees and Commissions Income
Securities Income
Net Gain (Loss) on Disposal of Financial Assets at Amortized Cost
FX/Derivatives/Other Operating Income
Impairment Losses Due to Credit Loss
General and Administrative Expenses
II. Non-Operating Income (Expense)
III.Net Income before Income Tax Expense
IV. Gain (Loss) on Discontinued Operations
V. Income Tax Expense
VI. Net Income
Net Income Attributable to Controlling Interests
Based on consolidated financial statements
Note) Based on consolidated financial statements
2019
(current) 186th term
2018
(previous) 185th term
2,592
5,317
887
972
214
84
383
△
118
△
3,494
52
△
2,644
471
△
645
1,527
1,506
22
2,422
5,141
850
911
213
44
318
△
△
85
△
3,484
48
2,470
299
717
2,052
2,033
18
095
(Unit: KRW in billions)
Changes
+170
+176
+38
+61
+1
+40
65
△
33
△
10
△
+4
+174
770
△
72
△
525
528
△
△
+3
In 2019, the net income (consolidated, controlling interests) of Woori Bank – major subsidiary – was KRW 1.506 trillion, down KRW 528 billion from 2018.
The main reason for the fall in net income can be attributed to the accounting loss of KRW 508.8 billion in relation to the transfer of shares from seven
subsidiaries, including Woori Card, to the holding company. Meanwhile, the operating income of 2019 was KRW 2.592 trillion, up KRW 170 billion y-o-y.
The decline in market rates and fiercer competition for deposits with the implementation of the new LDR rule pushed down NIM 0.08%p. Even so, net
interest income was up KRW 176 billion from 2018 to KRW 5.317 trillion, on the back of the growth of interest-bearing assets. Non-interest income
increased KRW 38 billion y-o-y to KRW 887 billion, with net fees and commissions income climbing KRW 61 billion and net gain on available-for-
sale (AFS) financial assets (gains on sales of loans in KRW) jumping KRW 40 billion, while securities income maintained the level of the last year. FX,
derivatives and other operating income altogether recorded a decline of KRW 65 billion y-o-y.
Net interest income was up 3.4% y-o-y, non-interest income 4.4% y-o-y, and continued efforts to raise cost efficiency contained the growth of general
and administrative expenses to just KRW 10 billion, or 0.3%, y-o-y to KRW 3.494 trillion. Consequently, the operating income of 2019 posted a y-o-y
growth of 7%.
Impairment losses due to credit loss was KRW 118 billion, up KRW 33 billion from the year before. This is mainly due to the decline in the reversal of
massive allowance for credit loss relating to Kumho Tire and STX Group in 2018, despite the sustained decrease in ordinary bad debt expenses driven
by efforts to improve asset soundness. Woori Bank has been managing asset soundness and bad debt expenses by boosting the share of financially
sound loans, continuously monitoring and preemptively managing industries of interest including shipbuilding, construction and shipping and
stringently managing risks. Driven by these endeavors, its NPL ratio in 2019 improved to the lowest-ever level of 0.4%.
In 2020, as economic uncertainties are expected to continue at home and abroad, the business environment is anticipated to be rough. However, based
on robust asset soundness, Woori Bank will strive to generate stable profits through its meticulous management of risks and customer-centric innovation.
3) Woori Card
Category
Credit Card Payment Volume
Operating Revenue
Net Income
(Unit: KRW in millions)
2019 (7th Term)
2018 (6th Term)
2017 (5th Term)
82,649,489
1,368,140
114,196
76,357,503
1,386,707
1,386,707
73,833,473
1,755,810
92,734
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
096
As credit card merchant fees were lowered, profits were down by KRW 95.6 billion in 2019. However, Woori Card overachieved initial target for net
income with KRW 114.2 billion, thanks to financial asset expansion, cost-cutting efforts and non-recurring factors relating to the BC Card litigation.
Overall business conditions for the credit card industry are expected to continue worsen in 2020, amid contracted private consumption due to
slow growth, a near-mature credit card business environment, rising household debt and lower merchant fees. More threats are posed by fiercer
competition from other industries such as ICT companies expanding their businesses in the payment and settlement market and online-only banks
planning to launch credit card businesses. Woori Card, however, plans to focus on boosting its revenue by thoroughly managing the profitability
of each business and efficiently controlling costs. In addition, Woori Card will expand profitable assets mainly through high-value members by
reinforcing data analytics and advancing marketing efforts. Woori Card will also readjust portfolio to attract new members and improve cost
structure. Woori Card will secure the foundation to continuously create income by boldly boosting the efficiency of business management. Woori
Card will actively cut costs by raising company-wide business efficiency and bolster asset soundness by thoroughly managing risk. Furthermore, in
order to secure the engine of new growth, Woori Card will make utmost efforts to align with the global networks of Woori Bank and expand synergetic
businesses with Group affiliates under Woori Financial Group Inc.
4) Woori Investment Bank
(Unit: KRW in millions)
Category
Operating Revenue
Operating Expenses
Operating Income
Net Income before Income Tax Expense
Net Income
Total Comprehensive Income
Note 1) Based on K-IFRS separate financial statements
2019 (48th Term)
2018 (47th Term)
2017 (46th Term)
201,329
145,790
55,539
53,945
54,981
53,719
202,168
170,086
32,081
31,732
32,388
32,369
183,595
161,446
22,149
21,890
20,637
20,824
In 2019, Woori Investment Bank recorded an operating income of KRW 55.5 billion, 73.1% (or KRW 23.5 billion) higher than the year before. Although
an increase in loans pushed up interest income, FX trading income declined y-o-y, bringing down operating revenue 0.4% (or KRW 800 million) from
the previous year to KRW 201.3 billion. In terms of operating expenses, the growth of deposits mainly led to higher interest expenses.
General and administrative expenses climbed from KRW 26.1 billion in 2018 to KRW 31.2 billion in 2019, as the workforce expanded during that period.
The net income after non-operating income (expense) and income tax expenses amounted to KRW 55 billion, up 69.8% (or KRW 22.6 billion) from KRW
32.4 billion in 2018. Increases in deferred tax assets led to income tax benefits of KRW 700 million and KRW 1 billion in 2018 and 2019, respectively.
Woori Investment Bank is developing and implementing vigorous growth plans with an aim to become a competitive non-banking subsidiary of
the Group as well as a core subsidiary in charge of financial investments.
5) Woori Asset Trust
Category
Operating Revenue
Operating Expenses
Operating Income (Loss)
Net Income from Continuing Operations before Income Tax Expense(Loss)
Net Income(Loss)
Total Comprehensive Income(Loss)
(Unit: KRW in millions)
2019
2018
2017
75,191
34,037
41,154
40,876
30,980
30,443
63,666
22,649
41,016
41,202
31,495
31,120
53,848
18,592
35,257
35,224
27,010
27,218
Note) 2017, 2018: Based on K-IFRS separate financial statements, 2019: Based on K-IFRS consolidated financial statements and controlling interest
Woori Asset Trust observed an increase of 18% (or KRW 11.5 billion) y-o-y in operating revenue, which reached KRW 75.2 billion in 2019. Despite the
negative outlook on the domestic real estate market, operating revenue increased 22% (or KRW 7.4 billion) in land trusts and other trust businesses,
while interest income jumped 45% (or KRW 1.4 billion) thanks to increased lending to trust accounts driven by expansion in loan-type land trusts.
Dividends also increased by 1,186% (or KRW 2.4 billion) due to the liquidation of Saengbo 4th Real Estate Investment Trust Company.
Operating expenses moved up 50% y-o-y (or KRW 11.4 billion) to KRW 34 billion. General and administrative expenses including payroll increased
by 42% (or KRW 7.5 billion) as the sales organization was realigned and reinforced with a larger workforce. Meanwhile, lending to trust accounts also
increased due to expansion in loan-type land trusts, increasing loan write-offs by 749% (KRW 3.5 billion).
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
097
Woori Asset Trust had one of the highest ROAs in the industry in 2019, at 25.2%. Real estate trust revenue is generally leveling off as trust fees continue
to fall and three new securities firms have entered the market and are fueling competition. Woori Asset Trust plans to gradually expand its presence
in the market for management-type land trusts backed by a completion guarantee, which has a lower risk relative to loan-type land trusts and higher
fees compared to other trust products. In addition, Woori Asset Trust will pursue mutually beneficial success with Group affiliates. As such, the
revenue and profitability of Woori Asset Trust is expected to grow.
6) Woori Asset Management
(Unit: KRW in millions)
Category
Operating Revenue
Operating Expenses
Operating Income (Loss)
Net Income from Continuing Operations before Income Tax Expense
Net Income (Loss)
Total Comprehensive Income (Loss)
Note) Based on K-IFRS separate financial statements
2019
2018
2017
24,990
14,754
10,236
10,236
8,001
8,822
23,999
15,584
8,415
8,415
5,991
5,743
28,110
17,837
10,273
10,273
7,110
7,258
Woori Asset Management recorded an operating revenue of KRW 25 billion in 2019, up 4% (or KRW 1 billion) y-o-y. With bond rates declining, AUM of
publicly offered bond funds increased, pushing up investment trust fees. However, as interest rates climbed in the second half of the year, AUM curved
downwards and discretionary funds were partially withdrawn, pushing down fees on discretionary investments. All in all, net fees and commissions
income remained similar to those of the previous year, but the management of inherent funds boosted gains on valuation and sales of securities by
107% (or KRW 1.1 billion) y-o-y.
Operating expenses decreased by KRW 830 million (or 5.3%) y-o-y to KRW 14.7 billion. Losses on valuation and sales of securities declined by KRW
1.1 billion over the previous year, while general and administrative expenses went up KRW 230 million as the workforce expanded. Net income after
non-operating income and income tax expenses reached KRW 8 billion, which is 36% (or KRW 2.1 billion) higher than the KRW 5.9 billion of 2018. The
growth in net income drove up income tax expenses by 16% (or KRW 380 million) y-o-y.
The ROA of Woori Asset Management was a solid 7.41% as of 2019. Although revenue in the management industry in general is plateauing as
management fees decline and deregulation spurs specialized PE management companies that fuel competition, Woori Asset Management expects its
AUM to grow, based on synergetic effects created with Group affiliates.
Net Income of Affiliates
(Unit: KRW in billions)
Category
Group
Woori Bank
Woori Card
Woori Investment Bank
Woori FIS
Woori Finance Research Institute
Woori Credit Information
Woori Fund Service
Woori Asset Trust
Woori Asset Management
Woori PE
Woori Global Asset Management
2019
2,038
1,906
114
53
3
0
2
2
-
2
2
△
1
△
Note 1) Net income: Based on total net income (Group-based Net Income Attributable to Controlling Interests: KRW 1,872 billion + net income attributable to non-controlling
interests: KRW 165 billion)
Note 2) Woori Bank: Based on separate financial statements of the Bank + overseas subsidiaries
Note 3) Newly incorporated subsidiaries of 019: Gain (loss) reflected after being incorporated into consolidated work sheet
- Date of incorporation into consolidated work sheet: Dec. 30 for Woori Asset Trust, Aug. 1 for Woori Asset Management and Woori Global Asset Management
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
098
(3) Asset Quality
1) Woori Financial Group Inc.
Category
Total Loans
Sub-Standard or Below Loans
Sub-Standard or Below Ratio
Coverage Ratio
(Unit: KRW in billions, %)
Mar 2019
June 2019
Sept 2019
Dec 2019
256,893
263,090
1,324
0.52
129.8
1,240
0.47
131.6
271,487
1,240
0.46'
136.5
266,432
1,198
0.45
133.6
Since its inception in January 2019, Woori Financial Group Inc. has been demonstrating remarkable performance every quarter in terms of asset
soundness. In particular, Woori Bank – the major subsidiary of the Group – continues to raise asset quality by boosting the share of financially sound
assets and by proactively writing off bad debt and preemptively managing risks to restrain non-performing loans.
Woori Financial Group Inc. is lowering its substandard or below ratio from 0.52% in Q1 to 0.47% in Q2, 0.46% in Q3 and 0.45% in Q4. Not only the
substandard or below ratio but the actual amount of such loans is also declining. In addition, Woori Financial Group Inc. stands fully ready to cover
additional losses should they be incurred, with a substandard and below coverage ratio (excluding reserves) of 133.6% at end-2019.
2) Asset Quality Indicators of Major Subsidiaries
(Unit: KRW in 100 millions, %)
Category
Indicator
2019
2018
2017
Woori Bank
Total Loans
2,430,845
2,339,165
2,221,185
Sub-Standard or Below Loans
Sub-Standard or Below Ratio
NPL
NPL Ratio
Coverage Ratio(A/B)
Total Allowance for NPL(A)
Sub-Standard or Below Loans(B)
Woori Card
Total Loans
Sub-Standard or Below Loans
Sub-Standard or Below Ratio
Delinquency Ratio
Coverage Ratio(A/B)
Credit Loss Provisions Outstanding(A)
Minimum Regulatory Reserve for Credit Loss(B)
Woori Investment Bank
Total Loans
Sub-Standard or Below Loans
Sub-Standard or Below Ratio
NPL
NPL Ratio
Coverage Ratio(A/B)
Credit Loss Provisions Outstanding(A)
Sub-Standard or Below Loans(B)
Woori Asset Trust
Assets Subject to Quality Classification
Sub-Standard or Below Assets
Ratio of Sub-Standard or Below Assets
Note) Based on Work Report of Financial Supervisory Service (FSS)
9,797
0.40
8,793
0.36
121.80
11,933
9,797
98,170
789
0.80
1.61
102.84
7,641
7,430
18,737
92
0.49
39
0.21
167.39
154
92
71,216
26,715
37.51
11,825
0.51
10,156
0.43
119.42
14,121
11,825
96,072
772
0.80
1.78
104.02
7,273
6,991
16,495
248
1.51
247
1.49
51.21
127
248
43,081
4,534
10.52
18,396
0.83
17,249
0.78
87.71
16,136
18,396
79,044
621
0.79
1.82
102.74
6,356
6,187
12,088
227
1.88
271
2.24
45.81
104
227
50,234
2,117
4.21
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
099
The substandard and below ratio of Woori Bank is on a downward trend from 0.83% in 2017 to 0.51% in 2018 and 0.40% in 2019, while the coverage
ratio (excluding reserves) has been boosted from 87.7%, 119.4% and 121.8% in the respective years. As such, Woori Bank is fully prepared to cover for
additional losses should they be incurred.
Corporate loans extended by Woori Bank was KRW 120 trillion in 2018 with a substandard and below ratio of 0.75%. In 2019, the numbers were
KRW 123 trillion and 0.57%, respectively. As such, Woori Bank has been cutting its substandard and below ratio drastically by boosting the share of
financially sound assets and by proactively writing off bad debt and preemptively managing risk to restrain non-performing loans. Household loans
recorded a total of KRW 113 trillion and a substandard and below ratio of 0.25% in 2018. In 2019, total household loans amounted to KRW 120 trillion
and the substandard and below ratio declined slightly to 0.23% (based on NPL criteria of FSS).
As sufficient provisions have been set aside for substandard or below loans to borrowers undergoing debt restructuring through work-out or
rehabilitation procedures, additional losses are unlikely to be incurred. These companies are proactively pursuing to normalize their business and if
unsuccessful, they are contemplating on closing their business through asset disposition. Woori Bank is also vigilantly monitoring risk signals from
other possible NPLs, thereby preemptively responding to economic uncertainties at home and abroad.
Woori Card has seen its delinquency ratio decline consistently from 1.82% in 2017 to 1.78% in 2018 and 1.61% in 2019. By fine-tuning risk management,
bolstering competencies to recover loans and constantly removing bad debt, Woori Card has been maintaining its delinquency ratio at a healthy level.
Woori Investment Bank has been striving to improve asset soundness since 2013. Bad loans that correspond to the numerator when calculating the
ratio of asset soundness were reduced by recovery, sale or write-off, while financially sound assets that correspond to the denominator were boosted,
resulting in improved asset soundness ratio overall. Furthermore, risk management has been reinforced in order to prevent non-performing assets.
Consequently, the ratio of new non-performing assets has dropped significantly since 2013. Woori Investment Bank is also boosting both preemptive
and ex-post risk management.
Loans of Woori Asset Trust, including lending to trust accounts, increased y-o-y by 68% (or KRW 30.1 billion), driven by the growth in loan-type land
trusts. However, substandard and below ratio ones, including lending to trust accounts also increased 25.65% (or KRW 22.2 billion), due to the strained
real estate market in Korea.
Woori Asset Management is bolstering preemptive risk management and internal controls inspection competencies as the core comprehensive
asset management company of the Group. To this end, Woori Asset Management is selecting and managing the investment universe of domestic
stocks and bonds more meticulously, while building a risk management system based on credit ratings of overseas bonds and establishing an internal
controls system on new products. Woori Asset Management also bolstered inspection on overseas/alternative investment processing procedures.
(4) Capital Adequacy
1) Woori Financial Group, Inc.
Category
Common Equity Tier 1 Capital
Additional Tier 1 Capital
Tier 2 Capital
Total BIS Capital
Risk-Weighted Assets
Common Equity Tier 1 Ratio
Tier 1 Capital Ratio
BIS Capital Adequacy Ratio
(Unit: KRW in billions)
2019 (1st Term)
19,135
3,340
4,640
27,115
228,046
8.39%
9.86%
11.89%
At end-2019, the Group BIS capital adequacy ratio using the Basel III standardized approach was 11.89%, which was above the requirement of
10.5%, as a result of rigorous endeavors to improve capital adequacy by issuing capital securities worth KRW 1.95 trillion and boosting high-
quality assets.
Woori Financial Group, Inc. will continue to comply with regulatory requirements, realize profits and recapitalize at an adequate level to raise
capital adequacy.
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
100
2) Capital Ratios of Major Subsidiaries
(Unit: KRW in 100 millions, %)
Category
Indicator
2019
2018
2017
Woori Bank
BIS Capital Adequacy Ratio
Total BIS Capital(A)
243,142
242,508
226,032
Risk-Weighted Assets(B)
1,578,895
1,549,710
1,467,622
Woori Card
Adjusted Capital Ratio
Tangible Common Equity Ratio
Woori Investment Bank
BIS Capital Adequacy Ratio
Total BIS Capital(A)
BIS Capital Adequacy Ratio(A/B)
Risk-Weighted Assets(B)
BIS Capital Adequacy Ratio(A/B)
Woori Asset Trust
Net Operating Capital Ratio (NCR)
Woori Asset Management
Minimum Operating Capital Ratio
15.40
18.33
14.29
3,381
26,303
12.86
1,397.97
655.8
15.65
18.08
13.54
3,003
23,192
12.95
957.76
558.9
15.40
20.74
14.98
2,713
16,202
16.74
698.59
514.7
Note 1) BIS capital adequacy ratio=total BIS capital/risk-weighted assets x 100
Note 2) Woori Bank numbers are based on K-IFRS consolidated financial statements and BASEL III
Note 3) Woori Card numbers are based on FSS work report criteria
Note 4) Woori Investment Bank numbers are based on FSS work report criteria/K-IFRS consolidated financial statements
Note 5) Net capital ratio of Woori Asset Trust=(net capital-subordinated borrowings, etc.)/total risk exposures (market risk + credit risk + operating risk)x100/K-IFRS separate
financial statements
Note 6) Woori Asset Management numbers are based on K-IFRS separate financial statements
Woori Bank
(Unit: KRW in billions, %)
Common Equity Tier 1 Capital
Additional Tier 1 Capital
Tier 2 Capital
Total BIS Capital
Risk-Weighted Assets
Common Equity Tier 1 Ratio
Tier 1 Capital Ratio
BIS Capital Adequacy Ratio
2019 (current)
186th Term
2018 (previous)
185th Term
17,321
3,466
3,527
24,314
157,890
10.97
13.17
15.40
17,276
3,148
3,828
24,251
154,971
11.15
13.18
15.65
Changes
+46
+318
△
301
+63
+2,919
0.18%p
△
0.01%p
△
0.25%p
△
At end-2019, Woori Bank – the major subsidiary of the Group – had a Common Equity Tier 1 Capital of KRW 17.321 trillion, up KRW 46 billion (or 0.3%)
y-o-y. Additional Tier 1 Capital was KRW 3.466 trillion, up KRW 318 billion y-o-y, which was driven by the issuance of new hybrid securities taking into
account the redemption (exercise of call option) of previously issued ones. Going forward, Woori Bank will continuously reduce the volume of its
hybrid securities, considering the cost of issuance. Tier 2 Capital amounted to KRW 3.527 trillion, down KRW 301 billion from the previous year. The
decline follows a reduction in the volume of subordinated bonds recognized as equity, but the reduction was minimized through the issuance of new
subordinated bonds. Total BIS Capital was KRW 24.314 trillion, which was KRW 63 billion higher than the year before.
In 2019, risk-weighted assets increased KRW 2.919 trillion (or 1.9%) y-o-y to KRW 157.89 trillion. This rate of increase is smaller than that of total assets
on a consolidated basis (2.3%) and is reflective of the vigorous efforts to improve capital adequacy by boosting the share of financially sound assets
and reducing potential non-performing assets.
Common Equity Tier 1 ratio, Tier 1 capital ratio and BIS capital adequacy ratio in 2019 fell by 0.18%p, 0.01%p and 0.25%p, respectively, from the year
before to 10.97%, 13.17% and 15.40%. This is because the dividends of Woori Bank, as the major subsidiary of the Group, were increased y-o-y to
secure sufficient funding for the dividends of the holding company in the initial days of its incorporation. Woori Bank will enhance its capital adequacy
by continuing to realize profits, paying out adequate levels of dividends and expanding capital.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
101
Woori Card had an adjusted capital ratio (ACR) of 18.33% at end-2019, which was above what is required by the Management Guidance (8% or above)
as per Supervisory Regulations on Specialized Credit Financial Business. Woori Investment Bank had a strong BIS capital adequacy ratio of 12.86% at
end-2019 (requirement by the Financial Investment Services and Capital Markets Act: 8%).
Woori Investment Bank is expected to see its BIS capital adequacy ratio fall with the growth of its assets under management. However, even after
reflecting the asset expansion plan for 2020 under the business management plan, the ratio is set to maintain a stable level above 12%. In addition, the
Total BIS Capital in December 2019 consisted of KRW 327.1 billion in Tier 1 Capital and KRW 11.1 billion in Additional Tier 1 Capital. With such a high Tier
1 percentage, there is great potential for asset expansion or recapitalization through an Additional Tier 1, if needed.
Woori Asset Trust had an equity capital of KRW 94.4 billion, which was 944.3% of the KRW 10 billion in minimum equity required of the company by the
Financial Investment Services and Capital Markets Act and the Enforcement Decree thereof. The net operating capital ratio was 1,398%, up 440%p
y-o-y, which was the largest gain among 11 existing trust companies last year. Woori Asset Management had an equity capital of KRW 106.7 billion,
while the minimum operating capital required of the company by the abovementioned Act and relevant regulations was KRW 16.1 billion. As such, the
minimum operating capital ratio of Woori Asset Management was 662.73%, with a very high share of equity capital.
B. New Businesses and Suspended Businesses
Woori Financial Group, Inc. has been seeking to expand its business portfolio since the launch, based on which it is bolstering its status and
competitiveness as a comprehensive financial group.
(1) Acquisition of Woori Asset Management and Woori Global Asset Management
Woori Financial Group, Inc. concluded a share purchase and sale agreements in April 2019 to acquire Woori Asset Management and Woori
Global Asset Management. After obtaining approval from the Financial Services Commission, Woori Asset Management and Woori Global Asset
Management were incorporated into Woori Financial Group Inc. as subsidiaries in August and December, respectively. The two companies will
endeavor to create synergy by sharing management expertise and co-developing fund products with Group affiliates and by providing a wide array of
products and services to its customers.
(2) Acquisition of Woori Asset Trust
Woori Financial Group, Inc. concluded a share purchase and sale agreement in April 2019 to obtain controlling interest in Woori Asset Trust, in order
to expand its business scope and competitiveness in the real estate trust sector. Incorporated into Woori Financial Group Inc. as a subsidiary in
December, Woori Asset Trust is expected to perform a pivotal role in real estate finance for the Group and boost the affiliated synergies.
C. Business Rationalization
(1) Alteration and Reorganization of Business Groups
1) Woori Financial Group, Inc.
New organization established to boost competitiveness in IT (Feb. 2019)
①
The ICT Planning Division was established to function as the IT control tower of Woori Financial Group Inc. The ICT Planning Group was organized in
February 2019 to oversee strategies in the areas of ICT planning, digital strategies and information security. This organization enabled a preemptive
response to the financial innovation driven by fintech and the fourth industrial revolution, while bolstering the expertise and competitiveness in ICT.
New organizations established to reinforce innovative growth and fintech support (May 2019)
②
In May 2019, the Future Finance Department and the Digital Innovation Department were established: the former with an aim to systematically
support companies with innovative growth potential and build a long-term sustainable growth system for the Group; and the latter targeting the
efficient discovery and nurturing of fintech companies. Woori Financial Group has since been carrying out such efforts to secure future growth
engines at the Group level and to provide systematic and intensive support to companies with innovative growth potential.
Reorganization to bolster Group collaboration and synergy (Jul. 2019)
③
In July 2019, Woori Financial Group, Inc. implemented a system of Main Business Units, under which the four growth engines of asset management,
global business, CIB and digital business that previously operated at each affiliate level were integrated at the Group level for systematic management.
Based on the system of collaboration among Group affiliates, responsible management and efficient decision making are expected to maximize synergy.
Furthermore, Woori Financial Group now has a foundation for a collaborative system that can prepare for the expansion of business portfolio.
Reorganization including units (Feb. 2020)
④
Units were established in Feb. 2020 to systematically manage businesses carried out by the Group and to reinforce responsible management. Woori
Financial Group also newly established a consumer protection organization as part of innovative measures to gain customer trust. In the second year
into the holding company system, Woori Financial Group will further solidify structure as a comprehensive financial group by systematically managing
major businesses.
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis 102
2) Woori Bank
In order to reinforce a swift decision making system in step with changes in the business environment, Woori Bank reorganized its operations to
center on group leaders. Also, in order to establish a customer-centered asset management business culture, Woori Bank established an integrated
bank-wide asset management strategy and ensured that the role of each group was reflected in their names. Woori Bank also newly established a
dedicated organization to bolster expertise and increase the independence of customer protection.
The previous “unit-group-division” system was reorganized to a “group-division” structure, thereby bolstering a system of autonomous responsible
management and swift decision making that allows a timely response to changes in the financial environment. In addition, the “WM Group” was
renamed “Asset Management Group” to reflect bank-wide asset management strategies into the name and to entrench a business culture of
customer-centric asset management. Furthermore, the “Consumer Protection Group” was newly established in order to promote the rights and
interests of financial consumers, while the previous “Consumer & Brand Group” was reorganized into the “Consumer Protection Group” and the
“Public Relations and Brand Group”.
The “Consumer Protection Group” has been separated as an independent organization directly under the CEO to function as the control tower of
consumer protection that oversees all the groups of Woori Bank.
3) Woori Card
Woori Card endeavors to aggressively and systematically respond to the changing business environment. Woori Card boosted focus on core functions
and speeded up decision-making by streamlining organization through functional readjustments among departments. With new and dedicated Big
Data organization, Woori Card is also pressing ahead with customer management by advancing marketing efforts to a higher level based on in-depth
customer analysis, reinforcing the loyalty of active members and boosting usage among inactive or dormant members. In addition, Woori Card is
building digital competencies with newly established and expanded digital marketing organization in order to respond to the ever-growing simple
payment market and digital finance ecosystem.
4) Woori Investment Bank
Woori Investment Bank restructured its organization with an aim to diversify the revenue base and reinforce risk management by newly establishing
the CIB Unit, under which CIB, DCM and venture finance organizations were realigned to maximize synergy creation among Group affiliates. Woori
Investment Bank is also pressing ahead to raise work efficiency by exchanging the site and workforce with Woori Bank. In addition, the FICC Finance
Department was newly established to head the bonds management and arrangements and a department in charge of ex-post management of loans
was created to bolster risk management.
5) Woori Asset Trust
Woori Asset Trust restructured its organization under the leadership of co-CEOs, aiming to invigorate synergetic effects created by the business
management sector and the business promotion sector. The Business Planning Department was newly established to build a growth engine for
promoting new business by reinforcing capacity in strategic planning and financial management. Furthermore, a Risk Management Officer and
a Compliance Officer were appointed to executive positions (with new, dedicated subordinate organizations) to bolster internal and external risk
management as well as internal controls. Woori Asset Trust also realigned itself to improve the entrustment review system to take on trust businesses
more selectively. In addition, efforts are being made to be reapproved as a REITs asset management company within the year.
6) Woori Asset Management
The Global Investment Management Unit is building a line-up of global fund products that continue to attract the interests of domestic investors
including lifecycle funds, Global EMP Asset Allocation Fund and global bond balanced funds.
(2) Voluntary Early Retirement Program and Other Matters
Since 2005, Woori Bank has implemented an Outplacement Services Program that serves as amended and upgraded ERP program. The
Outplacement Services Program (supporting individuals who are exiting the business) aims to resolve the bottleneck in promotions and
improve the bank’s human resource structure while allowing employees to find new opportunities during the second chapter of their lives. In
particular, the bank operates a support center and various programs for employees who plan to change jobs to provide systematic support for
a new career or post-retirement life. As of 2019, the Outplacement Services Program was provided to a total of 325 employees, improving the
bank-wide human resource structure.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 103
D. Asset Impairment Losses and Reduction Losses
Asset impairment losses and reduction losses incurred based on consolidated financial statements are as follows.
Category
Credit Loss on Financial Assets at Fair Value through Other Comprehensive Income (“FVTOCI”)
Reversal of (Provision for) Credit Loss on Securities at Amortized Cost
Provision for Credit Loss On Loans and Other Financial Assets at Amortized Cost
Reversal of Allowance for Acceptances and Guarantees Losses
Reversal of (Provisions for) Allowance for Undrawn Commitment
Reversal of (Provisions for) Impairment Losses on Premises, Equipment, Intangible Assets,
Goodwill and Other Assets
Provision for Impairment Losses on Investments in Joint Ventures and Associates
(Unit: KRW in millions)
(current) 1st Term
2018
(3,297)
1,415
(385,758)
4,352
9,044
(28,192)
(3,634)
(2,027)
(1,922)
(415,084)
105,985
(16,526)
674
(177)
1) Woori Bank
(1) Asset Impairment Losses
Category
Loss Amount
Cause of Loss
Intangible Assets and GoodwillNote 1)
KRW 25.85 billion
Reduction in amount recoverable within the
commitment period due to market changes
Shares in Affiliates
Based on separate financial statements
(cost method): KRW 41.9 billion
Following the decision by the majority shareholder KT
to assume loss (as requested by independent auditor)
Based on consolidated financial statements
(net asset value method): KRW 3.6 billion
Note 1) Assumes that the 2019 average balance of deposits and yield rate are maintained during the commitment period
(2) Reduction Losses
Woori Bank recognized reduction losses whenever the book value of the securities in equity method decreased by over 30 percent against their
acquired values.
(Unit: KRW in millions)
Category
Item
Loss Amount
Cause of Loss
Securities in Equity Method
Chinhung International Inc.
1,112
Book value decreased by over 30% against acquired values
Securities in Equity Method
Saman Corp.
93
Book value decreased by over 30% against acquired values
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
104
2) Woori Investment Bank
Category
Impairment Loss on Intangible Assets and Goodwill
Impairment Loss on Financial Assets Available for Sale
Total
(Unit: KRW in millions)
2019
(the 48th Term)
2018
(the 47th Term)
2017
(the 46th Term)
786
-
786
-
-
-
-
2,018
2,018
Woori Investment Bank conducts impairment tests each year on intangible assets and its activities of goodwill. Whenever there is sign of asset
impairment loss and the book value of intangible assets and goods are set to exceed the estimated recoverable amount, the book value is immediately
reduced to the recoverable amount. In the 2019 fiscal period, an impairment test was conducted on membership in the Bank’s possession and the
impairment loss was recognized for the book value of KRW 786 million that was in excess of the estimated recoverable value.
3) Woori Asset Trust
Category
Impairment Loss on Premises and Equipment
Impairment Loss on Intangible Assets and Goodwill
Total
Note 1) Based on K-IFRS separate financial statements
4. Liquidity, Sources & Applications of Fund
A. Liquidity
1) Woori Financial Group, Inc.
Category
Liquid Assets
Liquid Liabilities
LCR in KRW
2019
660
-
660
(Unit: KRW in millions)
2017
-
231
231
2018
-
-
-
(Unit: KRW in millions, %)
At End-2019
45,079
7,475
603.1
Note 1) Based on liquid assets and liabilities with time to maturity of one month or less
Liquidity risk refers to the risk of incurring unexpected losses (abnormal disposition of assets, financing through high interest rate, etc.) or becoming
insolvent due to disparities in dates of payment between assets and liabilities or the drastic outflow of funds. Each subsidiary of the Group secures
an adequate level of liquidity and minimizes their risk of shortage of funds by early prediction methods and systematically managing the causes of
fluctuations in liquidity, relevant to sourcing and managing funds.
Woori Financial Group, Inc. maintains an LCR in KRW at a level higher than 100% as required by law. Please refer to 4-3) Liquidity Risk in [III. Matters on
Financials/5. Notes for Financial Statements] of this report for details regarding liquidity risk management based on separate financial statements,
and to [III. Matters on Financials/3. Notes for Consolidated Financial Statements] 4-4) Liquidity Risk for details regarding liquidity risk management
based on consolidated financial statements.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
2) Woori Bank
Category
105
(Unit: %)
2019 (the 186th Term)
2018 (the 185th Term)
2017 (the 184th Term)
LCR (Including KRW and all other currencies)
Foreign Currency LCR
107.27
110.50
103.40
108.98
102.06
103.11
Note 1) The figures are calculated using the same method applied to management disclosure (average of the ratio per business day during the quarter.), based on the average
balance of Q4 in 2019, 2018 and 2017
Woori Bank has managed liquidity levels in compliance with regulatory standards of Basel III (90% in 2017, 95% in 2018, 100% since 2019). In order to
respond to regulatory LCR, highly liquid assets were expanded through deposits and debentures, preemptively. As a result, Woori Bank maintained a
stable LCR above the regulatory requirement (100%) at an average of 107.27% in Q4 2019.
Foreign currency LCR has been implemented since 2017, and Woori Bank has complied with the regulatory standards (60% for 2017, 70% for 2018,
and 80% from 2019 onwards). To secure a stable structure in regards to managing foreign currency LCR, Woori Bank has worked to maintain a higher
Foreign Currency LCR than what is required by regulatory standards (80% in 2019), with an average of 110.50% in Q4 2019, by securing sufficient high-
liquidity assets including U.S. Treasury bills, etc.
Furthermore, Woori Bank ensures that the liquidity gap ratio and concentration of funding more than satisfy regulatory guidelines in order to secure
a stable funding structure. Woori Bank also checks for excessive shortages of liquid assets through periodic stress testing. If liquidity is lacking due
to an unexpected crisis, Woori Bank executes contingency funding plans and utilizes committed lines from overseas financial institutions to acquire
liquidity. As such, Woori Bank establishes and manages bank-wide measures to preemptively mitigate and efficiently manage liquidity risks.
3) Woori Card
Woori Card performs funding based on the principles of diversifying sourcing channels, maintaining an adequate maturity structure and securing
liquidity, in order to maintain a stable funding structure.
At end-2019, outstanding debenture issues amounted to KRW 7.0809 trillion, which was KRW 34.9 billion higher than the KRW 7.0460 trillion of the
previous year. In addition, Woori Card has an adequate level of liquidity and a credit line of KRW 480 billion as means to repay borrowings that reach
maturity and provide operating funds without financing from the market for a certain period of time, even during an unexpected credit crunch in the
financing market.
(1) Liquidity
Based on consolidated financial statements
(Unit: KRW in 100 millions)
Category
Cash and Deposits
Credit Line
Total
2019
(the 7th Term)
2018
(the 6th Term)
2017
(the 5th Term)
1,362
4,800
6,162
3,822
5,300
9,122
6,461
4,200
10,661
(2) Financing through Debentures
Based on consolidated financial statements
Category
Debentures Issued in KRW
Liquid Debentures
Debentures Issued in Foreign Currencies
Total
(Unit: KRW in 100 millions)
2019
(the 7th Term)
2018
(the 6th Term)
2017
(the 5th Term)
60,500
9,383
926
70,809
60,200
9,701
559
70,460
54,300
6,455
535
61,290
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
106
(3) Time to Maturity of Debentures
Based on consolidated financial statements
Category
One Year or less
1 to 2 Years
2 to 3 Years
Over Three Years
Total
4) Woori Investment Bank
Category
KRW LCR
Foreign Currency LCR
2019
(the 7th Term)
2018
(the 6th Term)
2017
(the 5th Term)
(Unit: KRW in 100 millions)
20,154
17,839
15,616
17,200
70,809
19,555
20,040
16,865
14,000
70,460
11,900
19,414
19,946
10,030
61,290
(Unit: %)
At End-2019
(the 48th Term)
At End-2019
(the 47th Term)
At End-2019
(the 46th Term)
149.49
109.72
266.26
105.80
165.82
102.27
LCR in KRW stood at 149.49% and foreign currency LCR at 109.72% at the end of 2019, marking a 116.77%p drop and a 3.92%p increase, respectively,
year-over-year.
LCR in KRW is the ratio of assets and liabilities over a three-month period and Woori Investment Bank ensures that the figure remains at 100% or above
(as per Article 8-41, Regulation on the Financial Investment Services and Capital Markets, Liquid Assets/Liquid Liabilities). At end-2019, LCR in KRW was
149.49%, which is lower than that of end-2018, but still solid.
Foreign currency LCR refers to the ratio of foreign currency liabilities and assets over a three-month period that is required to be maintained at or
above 85% (as per Article 8-69, Regulation on the Financial Investment Services and Capital Markets, Liquid Assets, Liquid Liabilities). At end-2019, the
figure climbed slightly from that of the previous year to a stable 109.72%.
B. Sources and Management of Fund
1) Woori Financial Group, Inc. (based on separate financial statements of the holding company)
Category
Source of Fund
Total Source of Fund
Management of Fund
Total Management of Fund
Debentures
Other Liabilities
Equity
Cash and Deposits
Share Investments in Subsidiaries
Non-Current Assets
Other Assets
(Unit: KRW in billions)
At End-2019
948
153
20,106
21,207
1,173
19,874
11
149
21,207
Note 1) Other liabilities: Provisions + current income tax liabilities + deferred tax liabilities + other liabilities
Woori Financial Group, Inc. is a pure financial holding company incorporated pursuant to the Financial Holding Companies Act. Dividends from
subsidiaries are its main source of revenue, and no other sales activities are pursued.
The sources of funds in 2019 include KRW 94.8 billion in debenture issuance, KRW 99.8 billion in hybrid securities and KRW 67.6 billion in dividends.
Funds were managed mainly through the acquisition (including transfers) of shares in subsidiaries worth KRW 1,347 billion and hybrid securities
dividends of KRW 4 billion.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
3) Woori Bank
(1) Sources of Funds
107
(Unit: KRW in millions, %)
Category
Fund
2019 (186th Term)
2018 (185th Term)
2017 (184th Term)
Average balance
Interest rate
%
Average balance
Interest rate
%
Average balance
Interest rate
%
Funds
in KRW
Deposits, installments
212,554,654
1.50
66.58
197,572,001
1.41
66.67
187,332,008
1.26
66.02
Certificates of deposit
Borrowings in KRW
Call money in KRW
Others
Subtotal
4,759,552
6,965,780
407,753
2.09
1.43
1.60
1.49
2.18
0.13
5,039,885
6,554,881
221,027
21,924,679
2.36
6.87
20,937,173
1.97
1.47
1.50
2.39
1.70
2.21
0.07
7.07
4,500,100
6,213,903
1,254,623
20,168,307
1.66
1.32
1.23
2.29
1.59
2.19
0.44
7.11
246,612,418
1.59
77.25
230,324,967
1.51
77.73
219,468,941
1.37
77.34
Funds in
foreign
currencies
Deposits in foreign currencies
16,646,668
Borrowings in foreign currencies
7,944,242
Call money in foreign currencies
877,414
Debentures in foreign currencies
4,209,041
Others
Subtotal
Others
Total Equity
Provisions
Others
Subtotal
623,209
30,300,573
21,874,591
453,821
20,006,615
42,335,027
1.19
2.24
2.38
3.89
1.11
1.87
-
-
-
-
5.21
2.49
0.27
1.32
0.20
9.49
6.85
0.14
6.27
15,219,710
6,458,485
787,171
3,669,625
658,810
26,793,801
20,897,275
433,092
17,876,203
13.26
39,206,571
0.88
2.13
1.84
3.96
0.38
1.62
-
-
-
-
5.14
2.18
0.27
1.24
0.22
9.04
7.05
0.15
6.03
14,338,927
7,267,096
980,001
3,649,805
574,786
26,810,615
20,134,843
351,750
16,993,430
13.23
37,480,023
0.51
1.38
1.14
3.11
0.14
1.12
-
-
-
-
5.05
2.56
0.35
1.29
0.20
9.45
7.10
0.12
5.99
13.21
319,248,018
1.40
100.00
296,325,338
1.32
100.00
283,759,580
1.16
100.00
Note 1) Deposits in KRW = Deposits in KRW – Deposit checks & bills in the process of collection – reverse deposits with BOK – inter-bank adjustment funds (call loans)
* Deposit checks & bills in the process of collection = total checks and bills in the process of collection – checks & bills on clearing for overdrafts – inter-bank adjustment funds (call money)
* Interest for calculating interest rates is the sum of interest on deposits and installment deposits and deposit insurance premiums.
Note 2) Deposits in foreign currencies = Deposits in foreign currencies + off-shore deposits in foreign currencies
Note 3) Borrowings in foreign currencies = Borrowings in foreign currencies + dues to BOK in foreign currencies + off-shore borrowings in foreign currencies
Note 4) Debentures in foreign currencies = Debentures issued in foreign currencies + offshore debentures in foreign currencies
Note 5) Excluding merchant banking accounts
The average fund balance sourced by Woori Bank in 2019 stood at KRW 319 trillion, an increase of KRW 23 trillion over the previous year. The average
funds in Korean won totaled KRW 247 trillion, mainly sourced by deposits from customers for the stable management of liquidity. As a result, deposits
increased by KRW 15 trillion over the previous year, mainly in core deposits and time deposits. In order to respond to the regulatory LCR requirement
of 100% and changes in the LDR regulations, Woori Bank plans to ensure the stable management of liquidity through preemptive funding and boost
profitability through a more robust control of portfolio funding and management. The average balance of funds in foreign currencies increased KRW
3.5 trillion y-o-y, while deposits in foreign currencies were boosted by KRW 1.4 trillion and financing from the market (borrowings and debentures) by
KRW 2 trillion to stabilize funding.
Time to Maturity for Major Financial Liabilities
Category of Financial liabilities
3 months
or less
4 to 6
months
7 to 9
months
10 to 12
months
Financial Liabilities at Fair Value through Profit and Loss
115,156
-
-
-
(Unit: KRW in millions)
1 to 5
years
-
Over 5
years
Total
-
115,156
Depository
Borrowings
Debentures
160,955,482
35,917,880
23,560,412
28,653,283
5,305,862
543,242
254,936,161
5,516,024
2,522,971
2,068,362
1,742,550
3,213,689
500,685
15,564,281
1,775,711
2,326,926
2,770,855
1,998,438
13,872,930
1,487,529
24,232,389
Other Financial Liabilities
9,673,409
32,753
28,959
2,5170
147,182
2,547,159
12,454,632
Total
178,035,782
40,800,530
28,428,588
32,419,441
22,539,663
5,078,615
307,302,619
Note 1) Derivative financial liabilities and off-balance accounts (payment guarantees and commitments) are excluded
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
108
(2) Applications of Funds
(Unit: KRW in millions, %)
Category
Applications
2019 (186th Term)
2018 (185th Term)
2017 (184th Term)
Average balance
Interest rate
%
Average balance
Interest rate
%
Average balance
Interest rate
%
Funds
in KRW
Deposits in KRW
981,487
1.66
0.31
3,264,104
1.52
1.10
3,424,567
1.28
1.21
Marketable Securities in KRW
45,340,836
2.10
14.20
35,898,300
2.16
12.11
35,186,537
1.95
12.40
Loans in KRW
216,362,134
3.21
67.77
203,432,263
3.22
68.65
194,161,817
3.05
68.42
Advance Payments On Acceptances And
Guarantees
Call Loans in KRW
Privately Placed Bonds
Credit Card Receivables
Others
Allowance for Doubtful Accounts in KRW(-)
Subtotal
14,190
1.30
0.00
15,856
1.95
0.01
26,639
3.14
0.01
693,296
1.76
0.22
1,334,138
1.67
0.45
2,275,748
1.33
0.80
82,645
2.80
0.03
135,856
2.89
0.05
185,092
5.94
0.07
-
-
-
-
3,040,943
2.56
0.95
5,562,417
1,150,551
△
265,364,980
-
3.01
0.3
△
83.12
1,197,910
△
248,445,023
-
2.10
-
△
-
1.88
0.40
3.03
83.84
28
-
0.00
4,235,478
1.99
1.49
1,284,188
△
238,211,718
-
2.85
0.45
△
83.95
Funds in
foreign
currencies
Deposits in Foreign Currencies
5,475,080
1.91
1.71
3,664,724
1.29
1.24
3,791,184
0.67
1.34
Marketable Securities in Foreign Currencies
4,618,998
2.09
1.45
3,467,435
1.30
1.17
2,735,707
1.07
0.96
Loans in Foreign Currencies
13,682,670
3.41
4.29
11,346,607
3.14
3.83
10,790,442
2.51
3.80
Call Loans in Foreign Currencies
1,491,754
2.61
0.47
2,365,465
2.07
0.80
2,506,588
1.33
0.88
Bills Bought in Foreign Currencies
6,504,880
2.71
2.04
7,274,987
2.70
2.46
7,417,500
1.88
2.61
Others
71,016
2.12
0.02
32,665
3.31
0.01
48,472
2.50
0.02
Allowance for Doubtful Accounts in Foreign
Currencies(-)
228,898
△
-
0.07
△
390,923
△
-
0.13
△
332,301
△
-
0.12
△
Subtotal
Others
Cash
31,615,501
2.80
9.90
27,760,961
2.50
9.37
26,957,590
1.85
9.50
1,090,887
Property, Plant and Equipment for Business
2,698,226
Others
Subtotal
18,478,423
22,267,537
-
-
-
-
0.34
0.85
5.79
6.97
1,228,818
2,353,944
16,536,592
20,119,354
-
-
-
-
0.41
0.79
5.58
6.79
1,201,343
2,352,466
15,036,463
18,590,272
-
-
-
-
0.42
0.83
5.30
6.55
Total
319,248,018
2.78
100.00
296,325,338
2.78
100.0
283,759,580
2.57
100.0
Note 1) Deposits in KRW = Deposits in KRW – Reverse deposits with BOK
Note 2) Marketable securities in KRW = Marketable securities in KRW + Loaned securities in KRW * Interest for calculating interest rates = Securities interest (including dividend received)
+ Evaluation profit (net) + Gain on redemption of securities (net) + Portion excluding the gain from stock transactions (net) out of gains on sales of securities
Note 3) Loans in KRW = Loans in KRW + Checks & bills on clearing for overdrafts * Interest for calculating interest rates = Interest on loans in KRW – Contribution to the Korea Credit Guar-
antee Fund
Note 4) Deposits in foreign currencies = Deposits in foreign currencies + Offshore deposits in foreign currencies
Note 5) Marketable securities in foreign currencies = marketable securities in foreign currencies + Loaned securities in foreign currencies * Interest for calculating interest rates = Securi-
ties interests (including dividend received) + Evaluation profit (net) + Gain on redemption of securities (net) + Portion excluding the gain from stock transactions (net) out of gains
on sales of securities
Note 6) Loans in foreign currencies = Loans in foreign currencies + Offshore loans in foreign currencies + Inter-bank loans in foreign currencies + Loans from foreign borrowings +
Domestic import issuance bills
Note 7) Cash = Cash – Total checks & bills in the process of collection
Note 8) Property, plant and equipment for business = Property, plant, and equipment for business – Accumulated depreciation
Note 9) Based on K-IFRS financial statements
Note 10) Excluding merchant banking accounts
The average fund balance managed by Woori Bank in 2019 stood at KRW 265.3 trillion, an increase of KRW 16.9 trillion over the previous year, mainly
driven by an increase of loans in KRW by KRW 12.9 trillion. Out of all loans in Korean won, household loans increased by KRW 8.4 trillion, while corporate
loans increased by KRW 4.5 trillion. Yields for loans in Korean won declined 1bp from December 2018. Assets in foreign currency increased by KRW
3.8 trillion from the previous year to KRW 31.6 trillion, which is attributable to the increase of KRW 2.3 trillion and KRW 1.2 trillion in loans in foreign
currency and marketable securities, respectively. Woori Bank will continuously strive to comply with the liquidity guidelines (for loan-to-deposit ratio,
LCR, etc.) and ensure a stable management structure.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
4) Woori Investment Bank
(1) Sources of Funds
109
(Unit: KRW in millions, %)
Category
Fund
2019 (48th Term)
2018 (47th Term)
2017 (46th Term)
Average balance
Interest rate
%
Average balance
Interest rate
%
Average balance
Interest rate
%
Funds
in KRW
Deposits
Borrowings in KRW
Others
Subtotal
Others
Total Equity
Provisions
Others
Subtotal
2,282,715
2.24
79.05
1,892,535
2.03
74.98
1,346,377
1.72
72.92
111,690
0
1.43
0.00
3.87
0.00
712
0
1.64
0.00
0.03
0.00
521
0
1.44
0.00
0.03
0.00
2,394,405
2.21
82.92
1,893,247
2.03
75.01
1,346,898
1.72
72.95
337,102
29,889
126,364
493,355
-
-
-
-
11.67
1.04
4.38
17.08
337,102
27,894
265,655
630,651
-
-
-
-
13.36
1.11
10.53
24.99
240,663
27,210
231,500
499,373
-
-
-
-
13.04
1.47
12.54
27.05
Total
2,887,760
1.83
100.00
2,523,899
1.53
100.00
1,846,271
1.25
100.00
Note) Based on K-IFRS financial statements
(2) Applications of Funds
(Unit: KRW in millions, %)
Category
Applications
2019 (48th Term)
2018 (47th Term)
2017 (46th Term)
Average balance
Interest rate
%
Average balance
Interest rate
%
Average balance
Interest rate
%
Funds
in KRW
Deposits in KRW
Marketable securities in KRW
157,946
802,499
1.73
5.47
2.74
27.79
167,363
540,982
1.64
6.63
3.33
21.43
Loans in KRW
1,394,034
5.30
48.27
1,071,107
4.95
42.44
Privately placed bonds
363,269
4.99
12.58
387,406
4.86
15.35
127,635
414,778
760,529
193,679
1.15
6.91
3.08
22.47
4.63
41.19
5.29
10.49
Others
0
0.00
0.00
0
0.00
0.00
0
0.00
0.00
Allowance for doubtful accounts in
KRW (-)
(13,821)
-
-0.48
(11,829)
-
-0.47
(14,839)
-
-0.80
Subtotal
2,703,926
4.32
93.63
2,155,028
4.30
85.38
1,481,782
4.03
80.26
Funds in
foreign
currencies
Deposits in foreign currencies
Marketable securities in foreign
currencies
Subtotal
Cash
Others
Property, plant and equipment
for business
1,438
2,623
4,061
0
9,415
0.04
0.05
2.45
0.09
1.60
0.00
0.14
0.00
-
0.33
1,524
2,281
3,805
0
9,757
0.15
0.06
-0.48
0.09
-0.23
0.00
0.15
0.00
-
0.39
1,624
404
2,028
0
9,198
-
-
0.09
0.02
0.05
0.00
0.11
0.00
-
0.50
Others
Subtotal
170,358
179,772
-
-
5.90
6.22
355,308
365,065
-
-
14.08
14.46
353,263
362,461
-
-
19.13
19.63
Total
2,887,760
4.05
100.00
2,523,899
3.67
100.00
1,846,271
3.23
100.00
Note) Based on K-IFRS financial statements
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
110
5) Woori Asset Trust
(1) Sources of Funds
(Unit: KRW in millions)
Category
2019
2018
2017
Total Liabilities
Other Liabilities
Other Account Payables
Withholdings
Advance Receipts
Accrued Income Tax
Lease Liabilities
Unearned Income
Accrued Dividends
Leasehold Deposits
Allowance for Severance Benefits
Allowance for Trust Risk
Total Equity
Total
Note) Based on K-IFRS separate financial statements
(2) Applications of Funds
Category
Total Assets
Cash and Deposits
Marketable Securities
Loans
Premises and Equipment
Other Assets
Total
Note) Based on K-IFRS separate financial statements
Balance
45,410
45,410
9,081
1
24,552
4,857
2,443
-
656
-
-
3,820
94,429
139,839
2019
Balance
139,839
67,564
655
57,704
3,983
9,933
%
32%
32%
6%
18%
3%
2%
-
-
-
3%
68%
100%
%
100%
48%
1%
41%
3%
7%
Balance
37,333
37,333
2,292
1
26,040
6,462
-
102
656
-
230
1,550
76,453
113,786
2018
Balance
113,786
61,514
6,935
35,397
2,539
7,401
139,839
100%
113,786
%
27%
27%
2%
19%
5%
-
-
1%
55%
100%
%
100%
54%
6%
31%
2%
7%
100
Balance
67,204
67,204
31,186
5
30,256
5,339
-
-
256
12
-
150
%
54%
54%
25%
24%
5%
-
-
-
57,699
124,903
46%
100%
(Unit: KRW in millions)
2017
Balance
124,903
61,261
9,603
26,644
1,013
26,382
%
100%
49%
8%
21%
1%
21%
124,903
100%
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
6) Woori Asset Management
(1) Sources of Funds
111
(Unit: KRW in millions)
Category
2019
2018
2017
Average Balance
%
Average Balance
%
Average Balance
Sources (Total Liabilities and Equity)
Liabilities
Derivatives
Other Liabilities
(Accrued Income Tax)
(Accrued Expense)
(Others)
Total Equity
Note) Based on K-IFRS separate financial statements
107,159
4,921
-
4,921
1,506
2,428
987
102,238
100%
5%
0%
100%
31%
49%
20%
95%
98,762
3,930
14
3,915
1,416
2,099
400
94,832
100%
92,981
4%
0%
100%
36%
54%
10%
96%
4,658
499
4,158
1,185
1,992
982
88,324
%
100%
5%
11%
89%
28%
48%
24%
95%
(2) Applications of Funds
(Unit: KRW in millions)
Category
2019
2018
2017
Average Balance
%
Average Balance
%
Average Balance
Management (Total Assets)
Cash and Deposits
Securities Available for Sale
Financial Assets at Fair Value through
Profit or Loss (FVTPL)
Financial Assets at FVTOCI
Investments in Affiliates
Derivatives
Loans
Premises and Equipment
Other Assets
(Accrued Income)
(Deferred Tax Assets)
Note) Based on K-IFRS separate financial statements
107,159
24,757
-
54,653
15,995
3,240
25
100
848
7,541
5,329
1,639
100%
23%
-
51%
15%
3%
0%
0.1%
0.9%
7%
98,762
36,424
19,123
20,852
12,648
1,230
228
180
246
7,831
5,471
1,774
100%
37%
19%
21%
13%
1.2%
0.3%
0.3%
0.3%
7.9%
92,981
42,705
39,380
-
-
670
2,083
315
182
7,646
5,445
1,543
%
100%
46%
42.1%
-
-
1%
2.2%
0.3%
0.2%
8.2%
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis
112
5. Off-Balance Sheet Activities
(1) Acceptances and guarantees at the end of the current term and the previous year are as follows.
(Unit: KRW in millions)
Category
Confirmed Guarantees
Guarantees for Loans
Acceptances
Acceptances for L/G
Other Confirmed Guarantees
Subtotal
Unconfirmed Guarantees
Guarantees for Local L/C
Guarantees for Import L/C
Other Unconfirmed Guarantees
Subtotal
CP Purchase Commitments and Others
Total
Note) Based on K-IFRS separate financial statements
End of (current) First Term
End of Previous Year
89,699
391,688
224,746
6,982,889
7,689,022
193,096
3,081,390
771,378
4,045,864
884,031
12,618,917
125,870
371,525
158,179
6,452,791
7,108,365
305,057
3,322,731
669,677
4,297,46
1,260,587
12,666,417
(2) Loan agreements at the end of the current term and the previous year are as follows.
(Unit: KRW in millions)
Category
Loan Agreements
Other Agreements
End of (current) First Term
End of Previous Year
103,651,674
5,993,608
97,796,704
5,041,314
For off-balance sheet activities, please refer to ‘Note 40. Contingent Liabilities and Commitments’ in [III. Matters on Financials / 3. Notes for
Consolidated Financial Statements] in this report.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
113
6. Other Issues Required for Making Investment Decisions
A. Matters on Key Accounting Policies and Changes in Estimates
Please refer to ‘Note 2. Standards applied in the preparation of (Consolidated) Financial Standards and Key Accounting Policies’ and ‘Note 3.
Key Accounting Estimates and Assumptions’ in [III. Matters on Finance / 3. Note on Consolidated Financial Statements and 5. Note on Financial
Statements] of this report.
B. Environmental Impact and Employees
(1) Environmental Impact
Woori Financial Group Inc.’s financial services (banking, credit card, trusts business, etc.) do not have an environmentally destructive impact.
Therefore, the Group is neither currently paying nor is likely to have to pay any environmental restoration or damage compensation in the future. It has
not been and is not likely to be subject to administrative measures by the government or environmental authorities. Woori Bank, the major affiliate of
Woori Financial Group Inc., however, has been designated as a company subject to premise control under Paragraph 5, Article 42 of the Framework
Act on Low-Carbon, Green Growth. Accordingly, the Bank has reported to the government its greenhouse gas emissions and energy consumption.
Please refer to [XI. Other Issues Required for Protecting Investors / 3. Environmental Sanctions, and etc. / (v) Green Management Issues].
(2) Employees and Other Matters
Woori Bank, the major subsidiary of Woori Financial Group Inc., draws up a human resource plan based on changes in the management environment
and bank-wide strategic directions, thereby preemptively responding to expected personnel shifts in the mid- and long-term. While the Bank’s
continued recruitment and CDP control secure experts in corporate business, in-house training of human resources is nurturing a pool of future
leaders in the global and fintech businesses and building up the best human resource pool in the financial sector. Meanwhile, as of the end of 2019,
Woori Bank’s regular employees consisting of business unit and group heads (26%), managers (26%), and clerks or lower-level employees (48%),
maintaining HR in a pyramid structure.
Furthermore, another subsidiary, Woori Investment Bank, continues to hire experienced workers and new recruits in step with the broadening of
assets and work scope. Woori Investment Bank is expanding its business competencies by recruiting experts from the market, while building an
organization that can grow sustainably by hiring new recruits through public job openings. In addition, employees are sharpening their expertise
under the training support scheme.
C. Matters on Statutory Regulations
As a financial holding company, Woori Financial Group complies with the Financial Holding Companies Act, the Act on Corporate Governance of
Financial Companies and other relevant legislations.
The main contents of the Financial Holding Companies Act are as follows:
1. Incorporation of financial holding companies
2. Restriction on ownership of financial holding companies
3. Business affairs of financial holding companies and inclusion of companies as subsidiaries thereof
4. Operation of financial holding companies
5. Supervision of financial holding companies
The main contents of the Act on Corporate Governance of Financial Companies are as follows:
1. Qualifications for operating officers and the establishment of an appointment procedure for major operating officers
2. Reinforced qualifications for outside directors and procedures for nominating candidates for executive officers
3. Composition of the Board centered on outside directors and bolstering the authority of the Board
4. Establishment and disclosure of internal rules on governance
5. Qualifications for members of the Audit Committee and improvement of the appointment procedure thereof
6. Improvement of the risk management scheme and remuneration system
7. Introduction of a regular examination on the eligibility of major shareholders
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis 114
D. Risk Management Policy
(1) Overview of Risk Management Policy
Woori Financial Group Inc. develops strategies to remove excessive risks and manage risks at an adequate level in order to maximize revenue relative
to risks. To this end, procedure is to first recognize the risk, measurement and assess it and then control and monitor and report it. Risk is managed by
the Risk Management Department based on policy resolutions. The Risk Management Committee makes decisions on risk strategies including the
allocation of any capital at risk and the approval of loss limits as the top decision-making body for risk management.
(a) Risk Management Principles
The Group’s risk management principles are as follows:
- A ll busines s ac ti v i ties mus t be per for med in consideration of the balance bet ween r isk and revenue, w i thin the scope
of the preset risk thresholds.
- Decision making systems regarding risk must be operated in a way that allows sufficient consideration of risk by the management
- Risk management organization must be composed and operated independently from business departments
- Performance management systems must be operated to allow for the clear consideration of risks when making business decisions
- Even during normal times, precautionary views must be shared in preparation for the possible worsening of situations
- The holding company oversees the risk management of its subsidiaries
(b) Risk Management Organization
Risk Management Committee
①
The Risk Management Committee performs the role of comprehensively managing and controlling risks at the Group level, in order to promptly
recognize, measure, monitor and control risks that may arise in the course of business management by the holding company and subsidiaries thereof.
The major roles of the Risk Management Committee are as follows:
- Establishment of basic risk management policies and strategies:
The Risk Management Committee establishes basic policies and strategies for risk management including a risk philosophy and risk management
principles, for the systematic management of risks.
- Determination of tolerable risks:
The Risk Management Committee annually determines the overall permissible risk threshold of the Group and each subsidiary by giving
consideration to the economic and financial environment at home and abroad.
- Approval of Risk Capital Limit and Loss Limit:
Depending on the risk threshold determined each year, the Risk Management Committee sets aside the amount of capital at risk out of all available
capital, then approves and allocates the loss limits accordingly by type of risk and subsidiary.
- Enactment and Revision of Risk Management Regulations and Group Risk Management Council Regulations:
The Risk Management Committee enacts, operates and, if necessary, revises and abolishes risk management regulations and Group Risk
Management Council regulations in order to achieve optimal risk management
- Others:
The Risk Management Committee deliberates on relevant risks that accompany important matters concerning business management at the Group
level that requires Board resolution, including changes to the organization, entry into new businesses and large-scale investment. The Committee is
also briefed on the current status and major issues of risk management of the Group.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 115
Group Risk Management Council
②
The Group Risk Management Council has the authority to deliberate on necessary details in relation to carrying out the risk management policies
established by the Risk Management Committee at the level of the holding company and subsidiaries. The Council also reaches resolution on matters
delegated by the Risk Management Committee and performs the role of understanding the current status of risk management of the Group as a
whole and each subsidiary as well as exchanging information on risk management among subsidiaries.
The major roles of the Group Risk Management Council are as follows:
- Matters for Resolution
‧ Matters delegated by the Committee
‧Matters to be resolved pursuant to the [Attached Table] of the Group Risk Management Council Regulation
‧ Enactment and abolishment of guidelines on risk management. Provided, heads of departments in charge of risk management are delegated
authority to copy and incorporate in full any changes to higher regulations such as relevant legislations and regulations of supervisory authorities
and to make simple revisions to terminology or phrases, and shall report to the Council ex-post.
- Matters for Deliberation
‧ Matters concerning agenda tabled by the Committee (Provided, agenda for deliberation may be omitted when deemed necessary by the risk
management officer of the holding company)
‧ Important matters among matters for resolution by the Risk Management Committees of subsidiaries and result of implementation thereof
‧ Adjustments to the classification of asset quality or allowances for questionable accounts in accordance with criteria set by the Committee
‧ Matters concerning the introduction of a new product at the Group level
‧ Matters the Chair is requested to deliberate on by a member or matters recognized by the Chair to be in need of deliberation
- Matters for Report
‧ Status of progress and management of matters deliberated or resolved by the Council
‧ Other matters deemed necessary by the Council
Risk Management Department
③
The Risk Management Department is responsible for overseeing the risk management affairs of the financial holding company and its subsidiaries,
including the monitoring, control and reporting of risks. The department operates independently from departments within the financial holding
company and business (support) departments of subsidiaries.
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis 116
(2) Credit Risk
Credit risk represents ‘the potential financial losses that the Bank may incur when the counterparty becomes insolvent or rejects transactions within
the period provided in the contract.’ The goal of credit risk management is to maintain the bank’s credit risk exposure to a permissible degree and to
optimize its rate of return considering such credit risks.
(a) Management of Credit Risk
Woori Financial Group Inc. measures credit risk by taking into account the possibility of non-performance of contract obligations by a customer or
counterparty, a counterparty’s exposure to insolvency and the rate of loss upon insolvency.
For assets subject to credit risk management, internal capital is measured and utilized as a management indicator by accounting for risk and
expected/unexpected loss. The Group allocates ceilings of internal capital to each subsidiary. Based on the allocated ceiling of the internal capital,
each subsidiary then considers its business characteristics and annual financial goals to set and manage detailed ceilings for each business segment.
Furthermore, loans are prevented from failing to perform and credit concentration risk is adequately controlled by monitoring large-scale exposures
and credit portfolio.
The Group Risk Management Committee and Risk Management Council meet on a monthly or quarterly basis to check and adequately manage credit
risks of the Group and subsidiaries including the BIS ratio, liquidity and other management indicators, current status of exposure, compliance with
ceilings, delinquency ratio and fluctuations in allowances.
(b) Maximum Exposure
Maximum exposure of financial assets to credit risk indicates the uncertainty of maximum volatility in the net value of the financial assets due to
volatility in a particular risk factor, before considering the book value of collateral after allowances or other credit enhancement. Provided, the
maximum exposure to credit risk of derivatives is the on-balance sheet fair value amount, that of payment guarantee is the maximum amount payable
upon claims by the principal debtor pursuant to the guarantee contract, and that of loan agreement is undrawn commitment.
(3) Market Risk
Market risks refer to potential losses that can be incurred from trading positions of a financial institution according to changes in market factors,
such as interest rates, stock prices, and exchange rates. Market risks arise from changes in interest rates and exchange rates on unsettled financial
instruments. Thus, all contracts are exposed to a certain level of volatility according to interest rates, credit spread, exchange rates, and equity
securities prices.
(a) Market Risk Management
Market risk management refers to the entire process of identifying the sources of risks by risk factor on the trading and non-trading sectors,
measuring the scale of market risks, and assessing the adequacy of the scale of market risks being taken, in order to make decisions to avert, take or
mitigate risks and carry out such decisions.
Woori Financial Group Inc. uses both a standard approach and an internal model (Woori Bank) to measure market risks and the Risk Management
Committee allocates the market risk capital. The risk management departments of the Group and subsidiaries manage detailed ceilings including risk
limit and loss limit of trading positions. The result of risk management is reported regularly to the Risk Management Committee.
(b) Analysis of Market Risk Sensitivity
Woori Financial Group Inc. performs separate market risk sensitivity analyses for trading and non-trading segments.
For the trading segment, Group-wide market risk is managed by the standard method of the FSS, while Woori Bank measures Value at Risk (VaR) to
manage and measure market risk in order to predict the market risk of its trading positions and the maximum loss expected. Based on statistical
methods, VaR estimates potential losses in the portfolio that may be incurred by unfavorable volatility in the market at a certain time in the present or
future. VaR indicates the estimated maximum loss at a 99 percent confidence level. Therefore, statistically speaking, it is possible (1% probability) that
the actual loss turns out to be larger than what was estimated by VaR. The actual losses incurred are monitored on a regular basis for the purpose of
reviewing the feasibility of assumptions, variables and factors used when calculating VaR. This approach, however, does not prevent losses in excess of
the limit when there is greater market volatility.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 117
For the non-trading segment, Woori Bank manages and measures risk by utilizing simulations on net interest income (NII) and net present value (NPV)
to calculate changes in the NII and the economic value of equity (EVE).
NII is a revenue-centered indicator that shows short-term changes in revenue caused by short-term changes in the interest rate and is calculated by
deducting the cost of servicing interest-burdened liabilities from the revenues generated by interest-bearing assets. NPV is an indicator of risk from
an economic value point of view caused by interest rate volatility and is measured by deducting the present value of liabilities from that of assets.
Meanwhile, changes in the NII indicates changes due to interest rate volatility within a certain period (i.e., one year). Changes in the EVE indicates
changes that can take place as interest rate volatility impacts the present value of assets, liabilities and off-balance sheet items.
Subsidiaries other than Woori Bank measures and manages risk by calculating interest rate Earnings at Risk (EaR) and interest rate VaR.
Interest rate EaR refers to the estimated maximum changes to earnings manifested by the largest reduction in the NII that can be caused in a certain
period (i.e., one year) by unfavorable volatility in the interest rate. Interest rate VaR refers to the estimated maximum loss that shows the maximum
possible reduction in net asset value at a certain time in the present or future that can be caused by unfavorable volatility in the interest rate.
(4) Liquidity Risk
Liquidity risk refers to the risk of failing to perform the payment obligation at maturity on financial liabilities that consolidated companies bear.
Liquidity risk management is aimed at preventing potential losses arising from a shortage of funds by effectively managing liquidity crunches caused
by disparities in the maturity of assets and liabilities or unexpected outflow of funds. Products relevant to liquidity risk that recognized as financial
liabilities on the consolidated financial statements are subject to liquidity risk management.
In managing liquidity risk, Woori Financial Group Inc. groups assets and liabilities according to a different ALM chart of accounts, then determines the
maturity gaps and gap ratios from cash flow statements by time group (time to maturity or contract periods). Based on the outcomes, Woori Financial
Group maintains the gap ratios within predetermined target ratios (limits).
(5) Operational Risk
Woori Financial Group defines operational risks as the potential risk of loss that could result from inadequate internal processes, personnel and
systematic factors, as well as external factors.
To reinforce competitiveness, reduce the amount of risk capital, enhance operational risk management competencies and prevent any unexpected
incidents, Woori Bank has established an operational risk management system developed under Basel II. The objectiveness of operational risk
management system has been tested internally and by an independent third party. The advanced measurement approach was submitted to and
obtained approval from the FSS.
(6) Capital Management
Woori Financial Group Inc. complies with the capital adequacy standards put forth by financial supervisory bodies that are based on Basel III of
the Basel Committee on Banking Supervision under the Bank for International Settlements. These standards were introduced in Korea at the end
of December, 2013. The capital adequacy ratio is calculated by dividing total capital by total risk-weighted assets, based on consolidated financial
statements.
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis 118
D. Matters Concerning Overseas Subsidiaries
As the growth of domestic financial market remains stagnant, Woori Bank, which is the major subsidiary of Woori Financial Group Inc., has been
building a global business base by expanding regional networks in Southeast Asia – a region of promising growth potential in terms of NIM, branch
and financial inclusivity and economic growth rate.
Woori Bank is expanding localization endeavors through M&As with local banks (Indonesia, the Philippines, Cambodia) and the conversion of existing
branches into local subsidiaries (Vietnam), while seeking to diversify through entry into new businesses such as savings banks and non-banking
finance by considering market characteristics. In addition, other than entering existing business segments, Woori Bank is also striving to continue
pioneering into new markets by conducting various market surveys in order to discover new business. As of end of December 2019, Woori Financial
Group Inc. has global networks reaching 474.
Woori Financial Group Inc. will continue to pursue global business with its strategy to expand its customer and growth base by boosting the share
of financially sound assets, reinforcing business competencies through various business models and raising global digital banking competency.
Furthermore, Woori Financial Group is in the process of building a Group-wide system to support and manage global business by nurturing a pool
of global professional reviewers and building a better organized risk management system. Through these endeavors, Woori Financial Group is also
seeking to grow both quantitatively and qualitatively.
At end-2019, the status of overseas subsidiaries of major subsidiaries are as follows:
Category
Capital Adequacy Ratio
Asset Quality
Profitability
Liquidity
(Percentage of
BIS Capital
BIS Tier 1 Capital
Tangible Common
Loss-Risk
Substandard and
Ratio of
Ratio of
ROA
Expense Ratio to
Cost to Income
Foreign Currency
Ownership)
Adequacy Ratio
Ratio
Equity Ratio
Weighted Loan
Below Ratio
Allowance for
Delinquent Loans
Total Assets
Ratio
Liquidity Ratio
(Unit: %)
17.19
16.82
13.41
Ratio
0.07
Credit Loss
0.06
667.03
0.03
0.83
2.34
66.81
112.75
14.66
14.30
13.21
6.65
1.38
63.85
1.58
1.42
1.81
46.13
107.58
Woori America
Bank (100.00%)
Indonesia Woori
Saudara Bank
(79.88%)
China Woori Bank
22.89
22.66
6.74
1.78
0.60
44.74
0.65
0.09
1.15
70.26
185.90
(100.00%)
Russia Woori Bank
26.62
26.40
16.59
-
-
-
-
2.03
1.52
36.11
122.63
(100.00%)
Brazil Woori Bank
20.86
20.71
15.11
0.07
0.28
195.92
0.28
0.62
2.83
68.11
317.57
(100.00%)
Woori Finance
21.00
20.08
19.18
0.11
0.04
2,418.89
0.04
4.48
4.25
41.80
133.42
Cambodia
(100.00%)
Woori Finance
50.29
49.40
48.89
0.19
0.23
556.86
0.29
6.95
14.86
58.25
334.39
Myanmar
(100.00%)
Wealth
Development
Bank
(51.00%)
Vietnam Woori
Bank (100.00%)
WB Finance
(Cambodia)
(100.00%)
Europe Woori
Bank (100.00%)
Hong Kong Woori
Investment Bank
(100.00%)
17.36
17.01
10.55
21.72
5.84
18.19
6.36
0.33
4.64
95.51
78.80
15.52
15.23
15.41
0.30
0.36
259.58
0.05
1.18
2.46
64.34
129.18
21.1
20.3
20.41
0.62
0.28
416.32
0.29
3.95
6.96
56.23
158.49
59.08
58.96
25.27
-
-
-
2.22
△
3.28
304.0
100.89
-
43.18
43.18
21.41
1.57
3.37
35.60
3.37
1.20
0.78
28.41
107.65
Note) Based on K-IFRS separate financial statements
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
119
E. Korea BTL Infrastructure Fund
Korea BTL Infrastructure Fund (“the Company”) is a collective investment vehicle as defined by the Act on Public-Private Partnerships in Infrastruc-
ture and an investment company as per the Financial Investment Services and Capital Markets Act. The major shareholder, Woori Bank, has commit-
ted to invest a total of KRW 1.3 trillion in the Company under a purchase agreement valid until June 4th, 2036 (extendible for up to six years).
As of end of December 2019, funds under management of the Company are fully financed by equity capital and the major shareholder, Woori Bank,
has been executing equity investment through capital call since the incorporation of the Company. The Company currently invests in or extends
loans to project concessionaires, concentrating on highly stable projects whose principal and interest of investment are either paid or compensated
by the government. Invested projects include one BTO project, 43 BTL projects and 2 government cost compensation projects. Maintaining this ten-
dency, investments will be made gradually with the outstanding commitment under the purchase agreement.
The Company is maintaining a robust return on investment (ROI) (as of Dec 2019, capital is KRW 811.7 billion, ROI is 4.79% [internal rate of return
since incorporation, assuming recovery of investment principal at end-2019]). Most invested assets are BTL projects whose principal and interest are
tied to the yield on five-year government bonds and as such, ROI is likely to fluctuate with the bond yield. At the end of December 2018, ROI based on
the same assumption was 4.95%, indicating a small decline over the year in 2019, owing to the decline in the yield of five–year government bonds.
Currently, the Company is both making and redeeming investments. Following the recovery schedules for each invested project, the princi-
pals of investment will be recovered quarterly over the duration of the fund, once the investment is complete. Depending on whether new
investments will be executed by the Company, either a capital increase of the Company or a redemption on investment by shareholders will
be carried out systematically.
Woori OverviewBusiness OperationsFinancial ReviewManagement’s Discussion and Analysis Deloitte Anjin LLC
9F., One IFC,
10, Gukjegeumyung-ro,
Youngdeungpo-gu, Seoul
07326, Korea
Tel: +82 (2) 6676 1000
Fax: +82 (2) 6674 2114
www.deloitteanjin.co.kr
120
INDEPENDENT AUDITORS’ REPORT
INDEPENDENT AUDITORS’ REPORT
English Translation of a Report Originally Issued in Korean on March 16, 2020
To the Shareholders and the Board of Directors of Woori Financial Group Inc.
Report on the Separate Financial Statements
Audit Opinion
We have audited the separate financial statements of Woori Financial Group (the “Company”), which
comprise the separate statement of financial position as of December 31, 2019, and the separate statement of
comprehensive income, separate statement of changes in equity and separate statement of cash flows, for the
period from January 11, 2019 (date of incorporation) to December 31, 2019, and a summary of significant
accounting policies and other explanatory information.
In our opinion, the accompanying separate financial statements present fairly, in all material respects, the
financial position of the Company as of December 31, 2019, and its financial performance and its cash flows
for the period from January 11, 2019 (date of incorporation) to December 31, 2019 in accordance with Korean
International Financial Reporting Standards (“K-IFRS”).
Basis for Audit Opinion
We conducted our audits in accordance with the Korean Standards on Auditing (“KSAs”). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of
the Financial Statements section of our report. We are independent of the Company in accordance with the
ethical requirements, including those related to independence, that are relevant to our audit of the separate
financial statements in the Republic of Korea as required by prevailing audit regulations. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
The key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the separate financial statements of the current period. These matters were addressed in the context
of our audit of the separate financial statements as a whole, and in forming our audit opinion thereon, and we
do not provide a separate opinion on these matters.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
121
Impairment Losses of Subsidiary Investment Equities in compliance with K-IFRS 1036 ‘Impairment of
Assets’
Key audit matter description
As described in notes 2 and 9, the company accounts for its investment in subsidiaries by selecting the cost
method in accordance with K-IFRS 1027 and assessing their potential for impairment. If there is any
indication of objective impairment, the difference between the recoverable amount and the carrying amount
of the subsidiary investment shares is recognized as impairment losses, and the recoverable amount is
measured by calculating the estimated future cash flows based on the previous financial and operating plan
data.
The measure of recoverable amount of subsidiary investment shares uses discount rate, growth rate and
expected economic indicators, and significant management judgment is involved in determining their
adequacy.
Given the high level of estimation and judgement of management, the audit of impairment assessment of
subsidiary investment shares involves complex and subjective judgment by experts. Therefore, we selected
the impairment loss assessment of subsidiaries' investment shares as the key audit matter.
How the scope of our audit responded to the key audit matter
Our audit procedures related to the assumptions and unobservable inputs used by management for the
estimate of the recoverable amount included the following:
-
The effectiveness of the design and operation of internal controls related to the impairment
assessment process, including the use of external experts by the company’s management, has been
tested.
- We verified the process of determining the rationale of the input variables used and the discount
rate, growth rate, and expected economic indicators by using the shareholder cash flow discount
method by engaging a fair value valuation specialist.
-
The recoverable amount was recalculated by considering the discount rate and future cash flows
deemed appropriate with the fair value valuation specialist.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 122
Responsibilities of Management and the Those Charged with Governance for the Separate
Financial Statements
Management is responsible for the preparation of the accompanying separate financial statements in
accordance with K-IFRS, and for such internal control as they determine is necessary to enable the
preparation of separate financial statements that are free from material misstatement, whether due to fraud or
error.
In preparing the separate financial statements, management of the Company is responsible for assessing the
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the Company
or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Separate Financial Statements
Our objectives are to obtain reasonable assurance about whether the separate financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these separate
financial statements.
As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
-
-
-
-
-
Identify and assess the risks of material misstatement of the separate financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by management.
Conclude on the appropriateness of the management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the separate financial statements or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Company to cease to continue as
a going concern.
Evaluate the overall presentation, structure and content of the separate financial statements, including
the disclosures, and whether the separate financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 123
We communicate with those charged with governance of the Company regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance of the Company with a statement that we have complied
with relevant ethical requirements, including those related to independence, and to communicate with them
all matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with those charged with governance, we determine those matters that were
of most significance in the audit of the separate financial statements of the current period and are therefore
the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor’s report is Tae Jin Jo.
March 16, 2020
Notice to Readers
This report is effective as of March 16, 2020 the auditors’ report date. Certain subsequent events or
circumstances may have occurred between the auditors’ report date and the time the auditors’ report is read.
Such events or circumstances could significantly affect the separate financial statements and may result in
modifications to the auditors’ report.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 124
WOORI FINANCIAL GROUP INC.
SEPARATE STATEMENTS OF FINANCIAL POSITION
AS OF DECEMBER 31, 2019
WOORI FINANCIAL GROUP INC.
SEPARATE STATEMENTS OF FINANCIAL POSITION
AS OF DECEMBER 31, 2019
December 31, 2019
(Korean Won in millions)
ASSETS
Cash and cash equivalents (Note 5 and 28)
Financial assets at fair value through profit or loss (“FVTPL”) (Note 4, 6, 8
and 16)
Loans and other financial assets at amortized cost (Notes 4, 7, 8 and 28)
Investments in subsidiaries (Note 9 and 28)
Premises and equipment (Note 10 and 28)
Intangible assets (Note 11)
Total assets
LIABILITIES
Debentures (Notes 4, 8 and 12)
Provisions (Note 13)
Net defined benefit liability (Note 14)
Current tax liabilities (Note 25)
Deferred tax liabilities (Note 25)
Other financial liabilities (Notes 4, 8, 15, 28 and 29)
Other liabilities (Notes 15 and 28)
Total liabilities
EQUITY
Owners’ equity:
Capital stock (Note 17)
Hybrid security(Note 17)
Capital surplus (Note 17)
Other equity (Note 17)
Retained Earnings (Note 17)
(Regulatory reserve for credit loss has no balance.
Regulatory reserve for credit loss to be reserved is 692 million Won.
Planned provision of regulatory reserve for credit loss is 692 million
Won)
Total equity
Total liabilities and equity
See accompanying notes
43,670
9,434
1,269,203
19,873,593
7,383
3,310
21,206,593
947,679
600
3,482
133,526
154
10,745
4,142
1,100,328
3,611,338
997,544
14,874,084
(631)
623,930
20,106,265
21,206,593
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 125
WOORI FINANCIAL GROUP INC.
WOORI FINANCIAL GROUP INC.
SEPARATE STATEMENTS OF COMPREHENSIVE INCOME
SEPARATE STATEMENTS OF COMPREHENSIVE INCOME
FOR THE PEIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO
FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO DECEMBER 31, 2019
DECEMBER 31, 2019
For the period from January 11, 2019
(Date of incorporation) to December 31,
2019
(Korean Won in millions, except for per
share data)
Interest income
Interest expense
Net interest income (Note 8,18 and 28)
Fees and commissions income
Fees and commissions expense
Net fees and commissions loss (Note 19 and 28)
Dividend income (Note 20 and 28)
Net gain on financial instruments at FVTPL (Note 8 and 21)
Impairment losses due to credit loss (Note 8, 22 and 28)
General and administrative expenses (Notes 23 and 28)
Operating income
Net other non-operating expense
Non-operating loss (Note 24)
Net income before income tax expense
Income tax expense (Note 25)
Net income for the period
(Adjusted net income after the provision of regulatory
reserve:
For the period from January 11, 2019 (Date of
incorporation) to December 31, 2019: 627,601 million
Won) (Note 17)
Remeasurement of the net defined benefit liability
Other comprehensive loss, net of tax
Total comprehensive income
Basic and diluted income per share (in Korean Won)
(Note 26)
See accompanying notes
7,741
(7,701)
40
-
(15,833)
(15,833)
676,000
9,434
(263)
(39,941)
629,437
(750)
(750)
628,687
(394)
628,293
(631)
(631)
627,662
900
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review
126
WOORI FINANCIAL GROUP INC.
WOORI FINANCIAL GROUP INC.
SEPARATE STATEMENTS OF CHANGES IN EQUITY
SEPARATE STATEMENTS OF CHANGES IN EQUITY
FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO
FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO DECEMBER 31, 2019
DECEMBER 31, 2019
Capital
stock
Capital
surplus
Hybrid
Other
equity
Security
(Korean Won in millions)
Retained
Earnings
Total
equity
January 11, 2019
(Date of incorporation)
New stock issuance
(Comprehensive stock exchange)
New stock issuance costs
Net income
Remeasurement of the net defined
benefit liability
Issuance of hybrid security
Dividends to hybrid security
December 31, 2019
3,400,822
14,565,637
210,516
-
-
-
-
-
3,611,338
309,460
(1,013)
-
-
-
-
14,874,084
-
-
-
-
-
997,544
-
997,544
See accompanying notes
-
-
-
-
(631)
-
-
(631)
-
17,966,459
-
-
628,293
-
-
(4,363)
623,930
519,976
(1,013)
628,293
(631)
997,544
(4,363)
20,106,265
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 127
WOORI FINANCIAL GROUP INC.
SEPARATE STATEMENTS OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO DECEMBER 31, 2019
WOORI FINANCIAL GROUP INC.
SEPARATE STATEMENTS OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO
DECEMBER 31, 2019
For the period from January 11, 2019
(Date of incorporation) to December 31, 2019
(Korean Won in millions)
Cash flows from operating activities:
Net income
Adjustments:
Income tax expense
Interest income
Interest expense
Dividend income
Additions of expenses not involving cash outflows:
Impairment losses due to credit loss
Retirement benefits
Depreciation and amortization
Deductions of incomes not involving cash in-flows:
Gain on valuation of financial instruments at FVTPL
Changes in operating assets and liabilities:
Loans and other financial assets at amortized cost
Net defined benefit liabilities
Other financial liabilities
Other liabilities
Interest income received
Interest expense paid
Dividend income received
Net cash provided by operating activities
Cash flows from investing activities:
Cash in-flows from investing activities
Cash out-flows from investing activities:
Acquisition of investments subsidiaries
Acquisition of premises and equipment
Acquisition of intangible assets
Increase in guarantee deposits for leases
Increase in other investment assets
Net cash used in investing activities
Cash flows from financing activities:
Cash in-flows from financing activities:
Increase in borrowings
Issuance of debentures
Issuance of hybrid security
(Continued)
628,293
394
(7,741)
7,701
(676,000)
(675,646)
263
4,899
4,098
9,260
9,434
9,434
(1,365)
(1,687)
7,055
4,142
8,145
4,082
(6,097)
676,000
634,603
-
1,370,785
6,722
4,630
955
1,130,000
2,513,092
(2,513,092)
64,769
947,604
997,544
2,009,917
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review
128
WOORI FINANCIAL GROUP INC.
SEPARATE INTERIM STATEMENTS OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO DECEMBER 31, 2019
(CONTINUED)
WOORI FINANCIAL GROUP INC.
SEPARATE INTERIM STATEMENTS OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO
DECEMBER 31, 2019 (CONTINUED)
For the period from January 11, 2019
(Date of incorporation) to December 31, 2019
(Korean Won in millions)
Cash out-flows from financing activities:
Decrease in borrowings
Repayment of lease liabilities
New stock issuance costs
Dividends to hybrid security
Net cash provided by financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents, date of incorporation (Note 5)
Cash and cash equivalents, end of the year (Note 5)
See accompanying notes
64,769
1,289
17,337
4,363
87,758
1,922,159
43,670
-
43,670
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 129
WOORI FINANCIAL GROUP INC.
WOORI FINANCIAL GROUP INC.
NOTES TO SEPARATE FINANCIAL STATEMENTS
NOTES TO SEPARATE FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2019 AND FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF
AS OF DECEMBER 31, 2019 AND FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION) TO
INCORPORATION) TO DECEMBER 31, 2019
DECEMBER 31, 2019
1. GENERAL
(1) Woori Financial Group
Effective as of January 11, 2019, Woori Financial Group Inc. (hereinafter referred to the “Company”) was
established in accordance with the Financial Holding Companies Act for the main purposes of controlling
subsidiaries that operate financial business and similar business closely related to finance, through
comprehensive stock transfer under Article 360-15 of the Korean Commercial Code of Woori Bank, Woori FIS
Co., Ltd., Woori Finance Research Institute Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Service
Co., Ltd. and Woori Private Equity Asset Management Co., Ltd..
The head office of the Company is located in 51, Sogong-ro, Jung Gu, Seoul, Korea. As of September 30, 2019,
the common stock of the Company amounts to 3,611,338 million Korean won, and the Korea Deposit Insurance
Corporation (“KDIC”), the majority shareholder of the Company holds 124,604,797 shares (17.25% ownership
interest) of the Company’s shares issued. The Company’s common stocks were listed on the Korea Exchange on
February 13, 2019 and its American Depositary Shares(“ADS”) are being traded as the original stock on the
New York Stock Exchange since the same date.
(2) The stock transfer of the Company and its subsidiaries on the date of incorporation is as follows (Unit:
Number of shares):
Subsidiaries
Woori Bank
Woori FIS Co., Ltd.
Woori Finance Research Institute Co.,
Ltd.
Woori Credit Information Co., Ltd.
Woori Fund Service Co., Ltd.
Woori Private Equity Asset
Management Co., Ltd.
Total number of
issued shares
676,000,000
4,900,000
600,000
1,008,000
2,000,000
6,000,000
Exchange ratio
per share
Number of shares in
the Company
1.0000000
0.2999708
0.1888165
1.1037292
0.4709031
0.0877992
676,000,000
1,469,857
113,289
1,112,559
941,806
526,795
As of August 1, 2019, the company acquired a 73% stake in Woori Asset Management Co. (Formerly Tongyang
Asset Management Co.). The remaining payment was completed in August, 2019 after the request for the change
of major shareholder was approved by the Financial Service Commission in July, 2019 and the company gained
100% control of Woori Global Asset Management Co. (formerly ABL Global Asset Management Co.) to add as
a consolidated subsidiary at the end of 2019.
The company paid 598,391 million won in cash and 42,103,377 new shares of the parent company to acquire
100% interest of Woori Card Co., Ltd. from its subsidiary Woori Bank on September 10, 2019. On the same
date, the company also acquired 59.8% interest of Woori Investment Bank Co., Ltd. from Woori Bank with
392,795 million won in cash.
As of December 30, 2019, the company acquired a 67.2% interest in Woori Asset Trust Co. (formerly Kukje
Asset Trust Co.).
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 130
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2. BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES
(1) Basis of presentation
The Company’s separate financial statements are prepared in accordance with Korean International Financial
Reporting Standards (“K-IFRS”). Significant accounting policies applied in the preparation of the financial
statements are described below.
The Company is preparing its financial statements in accordance with the K-IFRS, and the separate financial
statements are prepared in accordance with K-IFRS 1027 “Separate Financial Statements”. The financial
statements of the parent, associate or joint venture represent the investment assets in a manner that is based on
direct equity investments, not based on the reported performance and net assets of the investee.
The financial statements are prepared at the end of each reporting period on the historical cost basis, except for
certain non-current assets and financial assets that are either revalued or measured in fair value. Historical cost is
generally measured at the fair value of consideration given to acquire assets.
The financial statements of the company were approved with adjustments as of March 3, 2020 after the initial
approval for the issuance as of February 7, 2020, and are planned to be finalized at the shareholder’s meeting on
March 25, 2020.
1.1 It is believed that the following issued and revised standards that have been newly applied during the
current term will not have a significant impact on the company.
-
-
-
-
-
-
K-IFRS 2123 Uncertainty over Income Tax Treatments (Issued)
K-IFRS 1109 Financial Instruments (Revised)
K-IFRS 1028 Investment in Associates and Joint Ventures (Revised)
K-IFRS 1019 Employee Benefits (Revised)
K-IFRS 1115 Revenue from Contracts with Customers (Revised)
Annual Improvements to IFRSs 2015-2017 Cycle
The annual improvements include partial amendments of K-IFRS 1012 ‘Income Tax,’ K-IFRS 1023
‘Borrowing Cost,’ K-IFRS 1103 ‘Business Combination’ and K-IFRS 1111 ‘Joint Arrangements.’
1.2 The details of K-IFRSs that have been issued and published as of the date of issue approval of the
financial statements but have not yet reached the effective date, and which the Company has not applied
at an earlier date are as follows:
-
-
-
Revised Conceptual Framework for Financial Reporting
Revised K-IFRS 1103 ‘Business Combinations’
Revised K-IFRS 1001 ‘Financial Statements Presentation’ and K-IFRS 1008 ‘Accounting policies,
changes in Accounting Estimates and Errors’
It is believed that the above revised standards will not have a significant impact on the company.
(2)
Investments in subsidiaries and Associates in separate financial statements
The Company selects and processes the cost method in accordance with K-IFRS 1027 for investments in
subsidiaries, associates and jointly controlled entities, except for those classified as held for sale in accordance
with K-IFRS 1105 ‘Non-current Assets Held for Sale and Discontinued Operations’. Dividends received from
subsidiaries, associates and jointly controlled entities are recognized as dividend income when the right to
receive dividends is established.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 3 -
131
(3) Revenue recognition
3.1 Revenue from contracts with customers
The Company recognizes revenue when the Company satisfies a performance obligation by transferring a
promised good or service to a customer. When a performance obligation is satisfied, the Company shall
recognize as a revenue the amount of the transaction price that is allocated to that performance obligation.
The transaction price is the amount of consideration to which the Company expects to be entitled in
exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf
of third parties.
3.2 Revenues from sources other than contracts with customers
Interest income on financial assets measured at FVTOCI and financial assets at amortized costs is measured
using the effective interest method.
The effective interest method is a method of calculating the amortized cost of debt securities (or group of
financial assets) and of allocating the interest income over the expected life of the asset. The effective
interest rate is the rate that exactly discounts estimated future cash flows to the instrument's initial total
carrying amount over the expected period, or shorter if appropriate. Future cash flows include commissions
and cost of reward points (limited to the primary component of effective interest rate) and other premiums
or discounts that are paid or received between the contractual parties, and future cash flows exclude
expected credit loss when calculating the effective interest rate. All contractual terms of a financial
instrument are considered when estimating future cash flows.
For purchased or originated credit-impaired financial assets, interest revenue is recognized by applying the
credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.
Even if the financial asset is no longer impaired in the subsequent periods due to credit improvement, the
basis of interest revenue calculation is not changed from amortized cost to unamortized cost of the financial
assets.
(4) Accounting for foreign currencies
The Company’s separate financial statements are presented in Korean Won, which is the functional currency of
the Company. At the end of each reporting period, monetary assets and liabilities denominated in foreign
currencies are translated to the functional currency at its prevailing exchange rates at the date.
(5) Cash and cash equivalents
The Company is classifying cash on hand, demand deposits, interest-earning deposits with original maturities of
up to three months on acquisition date, and highly liquid investments that are readily convertible to known
amounts of cash and subject to an insignificant risk of changes in value as cash and cash equivalents.
(6) Financial assets and financial liabilities
The Company’s accounting policies in accordance with the newly adopted K-IFRS 1109 are as follows:
6.1
Financial assets
A regular way purchase or sale of financial assets is recognized or derecognized on the trade or settlement
date. A regular way purchase or sale is a purchase or sale of a financial asset under a contract whose term
requires delivery of the asset within the time frame established generally by regulation or convention in the
marketplace concerned.
On initial recognition, financial assets are classified into financial assets at FVTPL, financial assets at
FVTOCI, and financial assets at amortized cost.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 132
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6.1.1
Business model
The Company evaluates the way business is being managed, and the purpose of the business model for
managing a financial asset best reflects the way information is provided to the management at its portfolio
level. Such information considers the following:
- The accounting policies and purpose specified for the portfolio, and the actual operation of such policies.
This includes strategy of the management focusing on the receipt of contractual interest revenue,
maintaining a certain level of interest income, matching the duration of financial assets and the duration
of corresponding liabilities to obtain the asset, and outflow or realization of expected cash flows from
disposal of assets.
- The way the performance of a financial asset held under the business model is evaluated, and the way
such evaluation is being reported to the management
- The risk affecting the performance of the business model (and financial assets held under the business
model), and the way such risk is being managed
- The compensation plan for the management (e.g. whether the management is being compensated based on
the fair value of assets or based on contractual cash flows received)
- Frequency, amount, timing and reason for sale of financial assets in the past and forecast of future sale
activities
6.1.2
Contractual cash flows
The principal is defined to be the fair value of a financial asset at initial recognition. Interest is not only
composed of consideration for the time value of money, consideration for the credit risk related to
remaining principal at a certain period of time, and consideration for other cost (e.g. liquidity risk and cost
of operation) and fundamental risk associated with lending, but also profit.
When evaluating whether contractual cash flows are solely payments of principal and interests, the
Company considers the contractual terms of the financial instrument. When a financial asset contains
contractual conditions that modify the timing and amount of contractual cash flows, it is required to
determine whether contractual cash flows that arise during the remaining life of the financial instrument
due to such contractual condition are solely payments of principal and interest. The Company considers the
following elements when evaluating the above:
- Conditions that lead to modification of timing or amount of cash flows
- Contractual terms that adjust contractual nominal interest, including floating rate features
- Early payment features and maturity extension features
- Contractual terms that limit the Company’s claim on cash flows arising from certain assets (e.g. non-
recourse feature)
6.1.2.1 Financial assets at FVTPL
The Company is classifying those financial assets that are not classified as either financial assets at
amortized cost or financial assets at FVTOCI, and those designated to be measured at FVTPL, as financial
assets at FVTPL. Financial assets at FVTPL are measured at fair value, and related profit or loss is
recognized in net income. Transaction costs related to acquisition at initial recognition is recognized in net
income immediately upon its occurrence.
It is possible to designate a financial asset as financial asset at FVTPL if at initial recognition: (a) it is
possible to remove or significantly reduce recognition or measurement mismatch that may otherwise have
occurred if not for its designation as financial asset at FVTPL; (b) the financial asset forms part of the
Company’s financial instrument group (A group composed of a combination of financial asset or liability),
is measured at fair value and is being evaluated for its performance, and such information is provided
internally; and (c) the financial asset is part of a contract that contains one or more of embedded
derivatives, and is a hybrid contract in which designation as financial asset at FVTPL is allowed under K-
IFRS 1109 ‘Financial Instruments’. However, the designation is irrevocable.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 5 -
133
Financial assets at FVTOCI
6.1.2.2
When financial assets are held under a business model whose objective is achieved by both collecting
contractual cash flows and selling financial assets, and when contractual cash flows from such financial
assets are solely payments of principal and interest, the financial assets are classified as financial assets at
FVTOCI. Also, for investments in equity instruments that are not held for short-term trade, an irrevocable
election is available at initial recognition to present subsequent changes in fair value as other
comprehensive income.
At initial recognition, financial assets at FVTOCI is measured at its fair value plus any direct transaction
cost and is subsequently measured in fair value. However, for equity instruments that do not have a
quotation in an active market and in which fair value cannot be measured reliably, they are measured at
cost. The changes in fair value except for profit or loss items such as impairment losses (reversals), interest
revenue calculated by using effective interest method, and foreign exchange gain or loss, and related
income tax effects are recognized as other comprehensive income until the asset’s disposal. Upon
derecognition, the accumulated other comprehensive income is reclassified from equity to net income for
FVTOCI (debt instrument), and reclassified within the equity for FVTOCI (equity instruments)
6.1.2.3 Financial assets at amortized cost
When financial assets are held under a business model whose objective is to hold financial assets in order to
collect contractual cash flows, and when contractual cash flows from such financial assets are solely
payments of principal and interest, the financial assets are classified as financial assets at amortized cost. At
initial recognition, financial assets at amortized cost are recognized at fair value plus any direct transaction
cost. Financial assets at amortized cost is presented at amortized cost using effective interest method, less
any loss allowance.
6.2
Financial liabilities
At initial recognition, financial liabilities are classified into either financial liabilities at FVTPL or financial
liabilities at amortized cost.
Financial liabilities are usually classified as financial liabilities at FVTPL when they are acquired with a
purpose to repurchase them within a short period of time, when they are part of a certain financial
instrument portfolio that is actually and recently being managed with a purpose of short-term profit and
joint management by the Company at initial recognition, and when they are derivatives that do not qualify
as hedging instruments. Financial liabilities at FVTPL are measured at fair value plus direct transaction cost
at initial recognition and are subsequently measured at fair value. Profit or loss arising from financial
liabilities at FVTPL is recognized in net income when occurred.
It is possible to designate a financial liability as financial liability at FVTPL if at initial recognition: (a) it is
possible to remove or significantly reduce recognition or measurement mismatch that may otherwise have
occurred if not for its designation as financial liability at FVTPL; (b) the financial liability forms part of the
Company’s financial instrument group (a group composed of a combination of financial asset or liability)
according to the Company’s documented risk management or investment strategy, is measured at fair value
and is being evaluated for its performance, and such information is provided internally; and (c) the financial
liability is part of a contract that contains one or more of embedded derivatives, and is a hybrid contract in
which designation as financial liability at FVTPL is allowed under K-IFRS 1109 ‘Financial Instruments’.
Financial liabilities designated as at FVTPL are initially recognized at fair value, with any direct transaction
cost recognized in profit or loss, and are subsequently measured at fair value. Any profit or loss from
financial liabilities at FVTPL are recognized in profit or loss.
Financial liabilities not classified as financial liabilities at FVTPL are measured at amortized cost. The
Company is classifying liabilities such as borrowings etc. as financial liabilities at amortized cost.
6.3
Reclassification
Financial assets are not reclassified after initial recognition unless the Company modifies the business
model used to manage financial assets. When the Company modifies the business model used to manage
financial assets, all affected financial assets are reclassified on the first day of the first reporting period after
the modification.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 134
6.4
Derecognition
- 6 -
Financial assets are derecognized when contractual rights to cash flows from the financial assets are
expired, or when substantially all of risk and reward for holding financial assets is transferred to another
entity as a result of a sale of financial assets. If the Company does not have and does not transfer
substantially all of the risk and reward of holding financial assets with control of the transferred financial
assets retained, the Company recognizes financial assets to the extent of its continuing involvement. If the
Company holds substantially all the risk and reward of holding a financial asset, it continues to recognize
that asset and proceeds are accounted for as collateralized borrowings.
When a financial asset is fully derecognized, the difference between the book value and the sum of
proceeds and accumulated other comprehensive income is recognized as profit or loss in case of FVTOCI
(debt instruments), and as retained earnings for FVTOCI (equity instruments).
In cases when a financial asset is not fully derecognized, the Company allocates the book value into
amounts retained in the books and removed from the books, based on the relative fair value of each portion
at the date of sale, and based on the degree of continuing involvement. For the derecognized portion of the
financial assets, the difference between its book value and the sum of proceeds and the portion of
accumulated other comprehensive income attributable to that portion will be recognized in profit or loss in
case of debt instruments and recognized in retained earnings in case of equity instruments. The
accumulated other comprehensive income is distributed to the portion of book value retained in the books,
and to the portion of book value removed from the books.
The Company derecognizes financial liabilities only when, the Company’s obligations are discharged,
cancelled or have expired. The difference between the carrying amount of the financial liability
derecognized and the consideration paid and payable is recognized in profit or loss.
When the Company exchanges with the existing lender one debt instrument into another one with the
substantially different terms, such exchange is accounted for as an extinguishment of the original financial
liability and the recognition of a new financial liability. Similarly, the Company accounts for substantial
modification of terms of an existing liability or part of it as an extinguishment of the original financial
liability and the recognition of a new liability. It is assumed that the terms are substantially different if the
discounted present value of the cash flows under the new terms, including any fees paid net of any fees
received and discounted using the original effective rate is at least 10 percent different from the discounted
present value of the remaining cash flows of the original financial liability.
6.5
Fair value of financial instruments
Financial assets at FVTPL and financial assets at FVTOCI are measured and presented in financial
statements at their fair values, and all derivatives are also subject to fair value measurement.
Fair value is defined as the price that would be received to exchange an asset or paid to transfer a liability
in a recent transaction between independent parties that are reasonable and willing. Fair value is the
transaction price of identical financial assets or financial liabilities generated in an active market. An active
market is a market where trade volume is sufficient and objective price information is available due to the
fact that bid and ask price differences are small.
When trade volume of a financial instrument is low, when transaction prices within the market show large
differences among them, or when it cannot be concluded that a financial instrument is being traded within
an active market due to disclosures being extremely limited, fair value is measured using valuation
techniques based on alternative market information or using internal valuation techniques based on general
and observable information obtained from objective sources. Market information includes maturity and
characteristics, duration, similar yield curve, and variability measurement of financial instruments of
similar nature. Fair value amount contains unique assumptions on each entity (the Company concluded that
it is using assumptions applied in valuing financial instruments in the market, or risk-adjusted assumptions
in case marketability does not exist).
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 7 -
135
The market approach and income approach, which are valuation techniques used to estimate the fair value
of financial instruments, both require significant judgment. Market approach measures fair value using
either a recent transaction price that includes the financial instrument, or observable information on
comparable firm or assets. Income approach measures fair value through discounting future cash flows with
a discount rate reflecting market expectations, and revenue, operating income, depreciation, capital
expenditures, income tax, working capital and estimated residual value of financial investments are being
considered when deriving future cash flows. Valuation techniques such as the above include estimates
based on the financial instruments’ complexity and usefulness of observable information in the market.
6.5.1
Expected credit losses on financial assets
The Company recognizes loss allowance on expected credit losses for the following assets:
- Financial assets at amortized cost
- Debt instruments measured at FVTOCI
- Contract assets as defined by K-IFRS 1115
Expected credit losses are weighted-average value of a range of possible results, considering the time value
of money, and are measured by incorporating information on past events, current conditions and forecasts
of future economic conditions that are available without undue cost or effort at the reporting date.
The methods to measure expected credit losses are classified into following three categories in accordance
with K-IFRS:
- General approach: Financial assets that does not belong to below two models and unused loan
commitments
- Simplified approach: When financial assets are either trade receivables, contract assets or lease
receivables
- Credit impairment model: Purchased or originated credit-impaired financial assets
a) Measurement of expected credit losses on financial asset at amortized cost
The expected credit losses on financial assets at amortized cost is measured by the difference between the
contractual cash flows during the period and the present value of expected cash flows. Expected cash inflows
are computed for individually significant financial assets in order to calculate expected credit losses.
When financial assets that are not individually significant, they are included in a group of financial assets
with similar credit risk characteristics and expected credit losses of the group are calculated collectively.
Expected credit losses are deducted through loss allowance account, and when the financial asset is
determined to be uncollectible, the loss allowance is written off from the books along with the related
financial asset. When loan receivable previously written off is subsequently collected, the related loss
allowance is increased and changes in loss allowance are recognized in profit or loss.
b) Measurement of expected credit losses on financial asset at FVTOCI
The measurement method of expected credit loss is identical to financial asset at amortized cost, but changes
in the allowance is recognized in other comprehensive income. When financial assets at FVTOCI is disposed
or repaid, the related allowance is reclassified from other comprehensive income to net income.
(7) Offsetting financial instruments
Financial assets and liabilities are presented as a net amount in the statements of financial position when the
Company has an enforceable legal right and an intention to settle on a net basis or to realize an asset and settle
the liability simultaneously.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 136
- 8 -
(8) Premises and equipment
Premises and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.
The cost of an item of premises and equipment is expenditures directly attributable to their purchase or
construction, which includes any cost directly attributable to bringing the asset to the location and condition
necessary for it to be capable of operating in the manner intended by management. It also includes the initial
estimate of costs of dismantling and removing the item and restoring the site on which it is located.
Subsequent costs are recognized in the carrying amount of an asset or as a separate asset (if appropriate) if it is
probable that future economic benefit associated with the assets will flow into the Company and the cost of an
asset can be measured reliably. Routine maintenance and repairs are expensed as incurred.
While land is not depreciated, for all other premises and equipment, depreciation is charged to net income on a
straight-line basis by applying the following estimated economic useful lives on the amount of cost or revalued
amount less residual value.
Leasehold Improvement
Properties for business purpose
Right-of-use asset
Useful life
5 years
5 years
Lease period
The Company reassesses the depreciation method, the estimated useful lives and residual values of premises and
equipment at the end of each reporting period. If changes in the estimates are deemed appropriate, the changes
are accounted for as a change in an accounting estimate. When there is an indicator of impairment and the
carrying amount of a premises and equipment item exceeds the estimated recoverable amount, the carrying
amount of such asset is reduced to the recoverable amount.
(9)
Intangible assets and goodwill
The Company is recognizing intangible assets measured at the manufacturing cost or acquisition cost plus
additional incidental expenses less accumulated amortization and accumulated impairment losses. The
Company’s intangible asset are amortized over the following economic lives using the straight-line method. The
estimated useful life and amortization method are reviewed at the end of each reporting period. If changes in the
estimates are deemed appropriate, the changes are accounted for as a change in an accounting estimate.
Software
Development cost
Useful life
5 years or period of use
5 years
In addition, when an indicator that intangible assets are impaired is noted, and the carrying amount of the asset
exceeds the estimated recoverable amount of the asset, the carrying amount of the asset is reduced to its
recoverable amount immediately.
(10) Impairment of non-monetary assets
Intangible assets with indefinite useful lives or intangible assets that are not yet available for use are tested for
impairment annually, regardless of whether or not there is any indication of impairment. All other assets are
tested for impairment by estimating the recoverable amount when there is an objective indication that the
carrying amount may not be recoverable. Recoverable amount is the higher of value in use or net fair value, less
costs to sell. If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying
amount of the asset is reduced to its recoverable amount and such impairment loss is recognized immediately in
net income.
(11) Provisions
The Company recognizes provision if (a) it has present or contractual obligations as a result of the past event, (b)
it is probable that an outflow of resources will be required to settle the obligation and (c) the amount of the
obligation is reliably estimated. Provision is not recognized for the future operating losses.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 9 -
137
Where the Company is required to restore a leased property that is used as an office to an agreed condition after
the contractual term expires, the present value of expected amounts to be used to dispose, decommission or
repair the facilities is recognized as an asset retirement obligation.
Where there are a number of similar obligations, the probability that an outflow will be required in settlement is
determined by considering the obligations as a whole. Although the likelihood of outflow for any one item may
be small, if it is probable that some outflow of resources will be needed to settle the obligations as a whole, a
provision is recognized.
(12) Equity instruments issued by the Company
The Company classifies a financial instrument that it issues as a financial liability or an equity instrument in
accordance with the substance of the contractual arrangement. A financial liability is a contractual obligation to
deliver cash or another financial asset to another entity. An equity instrument is any contract that evidences a
residual interest in the assets of an entity after deducting all of its liabilities. In case of hybrid securities that have
the unconditional right to avoid contractual obligations, such as to deliver cash or other financial assets related to
financial instruments, they are classifies as equity instruments and presented as part of equity.
If the Company reacquires its own equity instruments, the consideration paid including the direct transaction
costs (net of income tax expense) are presented as a deduction from total equity until such instruments are retired
or reissued. When these instruments are reissued, the consideration received (net of direct transaction costs) is
included in the shareholder’s equity.
(13) Employee benefits and pensions
The Company recognizes the undiscounted amount of short-term employee benefits expected to be paid in
exchange for the services rendered by the employees. Also, the Company recognizes expenses and liabilities in
the case of accumulating compensated absences when the employees render services that entitle their right to
future compensated absences. Similarly, the Company recognizes expenses and liabilities for customary profit
distribution or bonuses when the employees render services, even though the Company does not have legal
obligation to do so because it can be construed as constructive obligation.
The Company is operating defined benefit plans. For defined benefit plans, the defined benefit liability is
calculated through an actuarial assessment using the projected unit credit method every end of the reporting
period, conducted by professional actuaries. Remeasurement, comprising actuarial gains and losses, the return on
plan assets (excluding interest), and the effect of the changes to the asset ceiling (if applicable) is reflected
immediately in the separate statement of financial position with a charge or credit recognized in other
comprehensive income in the period in which they occur.
Remeasurement recognized in the statement of comprehensive income is not reclassified to profit or loss in the
subsequent periods. Past service cost is recognized in profit or loss in the period of a plan amendment. Net
interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit
liability or asset. Defined benefit costs are composed of service cost (including current service cost and past
service cost, as well as gains and losses on curtailments and settlements), net interest expense (income) and
remeasurement.
The Company presents the service cost and net interest expense (income) components in profit or loss, and the
remeasurement component in other comprehensive income. Curtailment gains and losses are accounted for as
past service costs.
The retirement benefit obligation recognized in the separate statement of financial position represents the actual
deficit or surplus in the Company’s defined benefit plans. Any surplus resulting from this calculation is
recognized as an asset limited to the present value of any economic benefits available in the form of refunds
from the plans or reductions in future contributions to the plans.
Liabilities for termination benefits are recognized at the earlier of either 1) the date when the Company is no
longer able to cancel its proposal for termination benefits or 2) the date when the Company has recognized the
cost of restructuring that accompanies the payment of termination benefits.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 138
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(14) Share-based payments
For cash-settled share-based payment transactions that provide cash in return for the goods or services received,
the Company measures the goods or services received, and the corresponding liability at the fair value and
recognizes as employee benefit expenses and liabilities during the vesting period.
The fair value of the liability is remeasured at the end of each reporting period and the settlement date until the
liability is settled, and changes in fair value are recognized as employee benefits.
(15) Income taxes
Income tax expense is composed of current tax and deferred tax. That is, income tax expense is composed of
taxes payable or refundable during the period and deferred taxes calculated by applying asset-liability method to
taxable and deductible temporary differences arising from operating loss and tax credit carryforwards.
Temporary differences are the differences between the carrying values of assets and liabilities for financial
reporting purposes and their tax bases. Deferred income tax benefit or expense is recognized for the change in
deferred tax assets or liabilities. Deferred tax assets and liabilities are measured as of the reporting date using the
enacted or substantively enacted tax rates expected to apply in the period in which the liability is settled or asset
realized. Deferred tax assets, including the carryforwards of unused tax losses, are recognized to the extent it is
probable that the deferred tax assets will be realized.
The Company, as a consolidation group for its wholly-owned subsidiaries applies consolidated tax return
approach, in which the Company and its subsidiaries are consolidated into a single tax base and tax amount. The
Company determined whether temporary differences are realizable by considering the Company and each
subsidiary’s future taxable income. For the changes in deferred income tax asset (liability), the Company
recognized income tax expense (benefit), excluding the amounts that are directly adjusted from equity. Also, as
the Company became the consolidation entity for tax filings and tax returns, it recognized the total amount of
income tax payables as liabilities and individual tax amounts to be received from each of its wholly-owned
subsidiaries as receivables.
Deferred income tax assets and liabilities are offset if, and only if, the Company has a legally enforceable right to
offset current tax assets against current tax liabilities, and the deferred tax assets and liabilities relate to income
taxes levied by the same taxation authority or when the entity intends to settle current tax liabilities and assets on
a net basis with different taxable entities.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the
extent it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred tax assets or liabilities are not recognized if they arise from the initial recognition (other than in a
business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the
accounting profit.
Current and deferred taxes are recognized in profit or loss, except when they relate to items that are recognized
in other comprehensive income or directly in equity or when it arises from business combination.
The tax uncertainty arises from the compensation claim filed by the Company, and refund litigation for the
amount of tax levied by the tax authority due to differences in tax law analysis. In response, the Company paid
taxes in accordance with K-IFRS 2123 due to the tax authority’s claim, but recognized as a corporate tax asset if
it is highly probable of a refund in the future.
(16) Earnings per share (“EPS”)
Basic EPS is a calculation of net income per each common stock. It is calculated by dividing net income
attributable to ordinary shareholders by the weighted-average number of common shares outstanding. Diluted
EPS is calculated by adjusting the earnings and number of shares for the effects of all dilutive potential common
shares.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 11 -
139
(17) Leases
17.1 Definition of lease
The Company determines whether the contract is, or contains, a lease at the date of initial application. A
contract is or contains a lease if the right to control the use of an identified asset is transferred in exchange
for the consideration received for a period of time. For a contract that contains a lease component, as a
practical expedient, the company may elect, by class of underlying asset, not to separate non-lease
components from lease components, and instead account for each lease component and any associated non-
lease components as a single lease component.
IFRS Interpretations Committee published its interpretation of ‘Lease Period and Lease Improvement Useful
Life’ as of December 16, 2019. The Interpretation Committee discussed a question about how to determine
the lease term for cancellable or renewable leases and according to the interpretation, the lease term will
depend on both the termination penalties in the contract and the broader economics of the contract. Agenda
decisions issued by the Interpretations Committee do not have an application date, but are expected to be
implemented as soon as possible. The Company is currently assessing the impact of the agenda decision and
does not expect a material impact to the financial statement.
17.2 Lessee
At the commencement date, the Company recognizes a right-of-use asset and a lease liability. For initial
recognition, a right-of-use asset is measured at a cost less any accumulated depreciation and any
accumulated impairment losses, adjusted for any remeasurement of the lease liability. If a right-of-use asset
satisfies the definition of an investment property, it can be presented as an investment property. A right-of-
use asset as an investment property is initially measured at a cost and subsequently measured at fair value, in
line with the Company’s accounting policy on the investment property.
At the commencement date, a lease liability is measured at the present value of the lease payments that are
not paid at that date. The lease payments are discounted using the interest rate implicit in the lease, if the
rate can be readily determined. If the rate cannot be readily determined, the Company’s incremental
borrowing rate can be used. Generally, the Company uses incremental borrowing rate as a discount rate.
A lease liability is subsequently measured by increasing the carrying amount to reflect interest rate on the
lease liability and reducing the carrying amount to reflect the lease payments made. A lease liability is
remeasured when future lease payments change, depending on the changes in an index or a rate, change in
amounts expected to be payable due to residual value guarantees, assessment of whether the Company is
reasonably certain to exercise the purchase option and extension option, the Company is not reasonably
certain to exercise the termination options.
A Company’s judgment is used when determining the lease term for some contracts that contain extension
options. The assessment on whether the Company is reasonably certain to exercise the extension option
could affect the lease term, and therefore, the lease liability and the right-of-use asset could be significantly
affected.
The Company chose not to recognize the right-of-use asset and the lease liability for the short-term leases
and some leases for which the underlying asset is of low value (e.g. IT facilities). The Company recognizes
the lease payments associated with those leases as an expense on a straight-line basis over the lease term.
17.3 Lessor
The Company classifies its leases as either an operating lease or a finance lease, and has different
accounting treatments for the two types of lease.
According to the Standards, if a lessor subleases an asset, the head lease and sublease must be accounted for
as separate contracts, and the sublease is classified by reference to the assets arising from its head lease.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 140
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3.
SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS
The significant accounting estimates and assumptions are continuously being evaluated based on numerous
factors including historical experiences and expectations of future events considered to be reasonably possible.
Actual results can differ from those estimates based on such definitions. The accounting estimates and
assumptions that contain significant risk of materially changing current book values of assets and liabilities in
the next accounting periods are as follows:
(1)
Income taxes
The Company has recognized current and deferred taxes based on best estimates of expected future income tax
effect arising from the Company’s operations until the end of the current reporting period. However, actual tax
payment may not be identical to the related assets and/or liabilities already recognized, and these differences
may affect current taxes and deferred tax assets/liabilities at the time when income tax effects are finalized.
Deferred tax assets relating to tax losses carried forward and deductible temporary differences are recognized
only to the extent that it is probable that future taxable profit will be available against which the tax losses
carried forward and the deductible temporary differences can be utilized. In this case the Company’s evaluation
considers various factors such as estimated future taxable profit based on forecasted operating results, which are
based on historical financial performance. The Company is reviewing the book value of deferred tax assets every
end of the reporting period and in the event that the possibility of earning future taxable income changes, the
deferred tax assets are adjusted up to taxable income sufficient to use deductible temporary differences.
(2) Valuation of financial instruments
Financial assets at FVTPL and FVTOCI are recognized in the separate financial statements at fair value. All
derivatives are measured at fair value. Valuation techniques are required in order to determine fair values of
financial instruments where observable market prices do not exist. Financial instruments that are not actively
traded and have low price transparency will have less objective fair value and require broad judgment in
liquidity, concentration, uncertainty in market factors and assumption in price determination and other risks.
As described in Note 2, (6.5), ‘Fair value of financial instruments’, when valuation techniques are used to
determine the fair value of a financial instrument, various general and internally developed techniques are used,
and various types of assumptions and variables are incorporated during the process.
(3)
Impairment of financial instruments
KIFRS 1109 requires entities to measure loss allowance equal to 12-month expected credit losses or lifetime
expected credit losses after classifying financial assets into one of the three stages, which depends on the degree
of increase in credit risk after their initial recognition.
Stage 1
Credit risk has not significantly
increased since initial recognition(*)
Allowance for
expected credit
losses
Expected 12-month credit losses:
Expected credit losses due to possible
defaults on financial instruments within a
12-month period from the end of
reporting period.
Stage 2
Credit risk has significantly
increased since initial
recognition
Stage 3
Credit has
been impaired
Expected lifetime credit losses:
Expected credit losses from all possible defaults
during the expected lifetime of the financial
instruments.
(*) Credit risk may be considered to not have been significantly increased when credit risk is low at the end of reporting
period.
The Company has estimated the allowance for credit losses based on reasonable and supportable information that
was available without undue cost or effort at the reporting date about past events, current conditions and
forecasts of future economic conditions.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 13 -
141
(4) Defined benefit plan
The Company operates a defined benefit pension plan. Defined benefit obligation is calculated at every end of
the reporting period by performing actuarial valuation, and estimation of assumptions such as discount rate,
expected wage growth rate and mortality rate is required to perform such actuarial valuation. The defined benefit
plan, due to its long-term nature, contains significant uncertainties in its estimates.
(5) Impairment of non-monetary assets
At the end of each reporting period, the company assesses the existence of impairment indications for all non-
monetary assets. An intangible asset with indefinite useful life is tested for impairment annually or in the event
of signs of impairment, and other non-monetary assets are tested for impairment when there are indications that
the carrying amount will be not recoverable. To calculate value in use, management estimates future expected
cash flows from the asset or cash-generating unit and selects an appropriate discount rate to calculate the present
value of this future cash flow.
4. RISK MANAGEMENT
The Company is exposed to various risks that may arise from its operating activities and credit risk, market risk
and liquidity risk are the main types of risks. In order to manage such risks, the Risk Management Committee
analyzes, assesses, and establishes risk management standards, including policies, guidelines, management
systems and decision-making to ensure sound management of the Group.
The Risk Management Committee, Chief Risk Officer (“CRO”) and the Risk Management Department are
operated as risk management organizations. The board of directors operates the Risk Management Committee,
composed of nonexecutive directors for professional risk management. The Risk Management Committee
performs as the top decision-making body for risk management by establishing fundamental risk management
policies that are consistent with the Group’s management strategy and by determining the Group’s acceptable
level of risk.
CRO assists the Risk Management Committee and operates the Group Risk Management Council, which is
composed of the risk management officers of the subsidiaries, to periodically check and improve the external
environment and the Group’s risk burden. The Risk Management Department which is independently structured,
controls the risk management matter of the Group and reports key risks and assists decision-making.
(1) Credit risk
Credit risk represents the possibility of financial losses incurred when the counterparty fails to fulfill its
contractual obligations. The goals of credit risk management are to maintain the Company’s credit risk exposure
to a permissible degree and to optimize its rate of return considering such credit risk.
1.1
Credit risk management
The Company measures expected loss on assets subject to credit risk management and uses it as a
management indicator.
1.2 Maximum exposure to credit risk
The maximum exposure to credit risk for financial instruments is as follows (Unit: Korean Won in
millions):
Loans and other financial assets
at amortized cost
Banks
Corporates
Financial assets at FVTPL
Derivatives
Total
December 31, 2019
1,228,918
40,285
1,269,203
9,434
1,278,637
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 142
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a) Credit risk exposure by geographical areas
The following tables analyze credit risk exposure by geographical areas (Unit: Korean Won in millions):
Loans and other financial assets at amortized cost
Financial assets at FVTPL
Total
b) Credit risk exposure by industries
December 31, 2019
Korea
1,269,203
9,434
1,278,637
The following tables analyze credit risk exposure by industries, which are finance and insurance and others
in accordance with the Korea Standard Industrial Classification Code (Unit: Korean Won in millions):
Loans and other financial assets at amortized cost
Financial assets at FVPTL
Total
1.3
Credit risk exposure
December 31, 2019
Finance and
insurance
1,267,228
9,434
1,276,662
Others
1,975
-
1,975
Total
1,269,203
9,434
1,278,637
The credit soundness for financial assets is as follows (Unit: Korean Won in millions):
December 31, 2019
Stage 1
Stage 2
Above
appropriate
credit rating
(*1)
Less than
a limited
credit
rating
(*3)
Above
appropriat
e credit
rating
(*2)
Less than a
limited
credit rating
(*3)
Allowance
for loan
losses
Total, net
Collateral
value of
impaired
asset
Stage 3
Total
Loans and other
financial assets at
amortized cost
Banks
Corporates
General
corporates
Total
1,269,466
1,229,181
40,285
40,285
1,269,466
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,269,466
1,229,181
40,285
40,285
1,269,466
(263)
(263)
-
-
(263)
1,269,203
1,228,918
40,285
40,285
1,269,203
-
-
-
-
-
(*1) Credit grade of corporates are AAA ~ BBB.
(*2) Credit grade of corporates are A- ~ BBB
(*3) Credit grade of corporates are BBB- ~ C.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 15 -
143
(2) Market risk
Market risk is the possible risk of loss arising from trading and non-trading activities in the volatility of market
factors such as interest rates, stock prices, and foreign exchange rates. The Company’s major market risk is
interest rate risk.
The Company estimates and manages risks related to changes in interest rate due to the difference in the
maturities of interest-bearing assets and liabilities and discrepancies in the terms of interest rates. Cash flows
(both principal and interest), interest-bearing assets and liabilities, presented by each repricing date, are as
follows (Unit: Korean Won in millions):
Within 3
months
4 to 6
months
December 31, 2019
10 to 12
months
7 to 9
months
1 to 5
years
Over 5
years
Total
Asset:
Loans and other
financial assets at
amortized cost
Liability:
Debentures
(3) Liquidity risk
445,070
733,330
-
-
-
-
1,178,400
5,486
5,486
5,486
5,487
87,780
1,049,863
1,159,588
Liquidity risk refers to the risk that the Company may encounter difficulties in meeting obligations from its
financial liabilities.
3.1
Liquidity risk management
Liquidity risk management is to prevent potential cash shortages as a result of mismatching the assets and
liabilities or unexpected cash outflows. The financial liabilities in the statement of financial position that
are relevant to liquidity risk are incorporated within the scope of risk management.
The Company manages liquidity risk by identifying the maturity gap and such gap ratio through various
cash flows analysis (i.e. based on remaining maturity and contract period, etc.).
3.2 Maturity analysis of non-derivative financial liabilities
a)
Cash flows of principals and interests by remaining contractual maturities of non-derivative financial
liabilities are as follows (Unit: Korean Won in millions):
Within 3
months
5,486
335.
6,131
11,952
4 to 6
months
5,486
335
2,043
7,864
December 31, 2019
7 to 9
months
10 to 12
months
1 to 5
years
5,486
335
-
5,821
5,487
336
183
6,006
87,780
249
820
88,849
Over
5 years
1,049,863
-
Total
1,159,588
1,590
-
1,049,863
9,177
1,170,355
Debentures
Lease liabilities
Other financial
liabilities
Total
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 144
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b) Cash flows of principals and interests by expected maturities of non-derivative financial liabilities are
as follows (Unit: Korean Won in millions):
December 31, 2019
Within 3
months
5,486
335.
4 to 6
months
5,486
335
7 to 9
months
5,486
335
6,131
11,952
2,043
7,864
-
5,821
10 to 12
months
1 to 5
years
5,487
336
183
6,006
87,780
249
820
88,849
Over 5
years
1,049,863
-
Total
1,159,588
1,590
-
1,049,863
9,177
1,170,355
Debentures
Lease liabilities
Other financial
liabilities
Total
(4) Capital management
The Company complies with the standard of capital adequacy provided by financial regulatory authorities. The
capital adequacy standard is based on Basel published by Basel III Committee on Banking Supervision in Bank
for International Settlement in 2010 and was implemented in Korea in December 2013. The capital adequacy ratio
is calculated by dividing own capital by asset (weighted with a risk premium – risk weighted assets) based on the
consolidated financial statements of the company.
According to the above regulations, the Company is required to meet the following new minimum requirements:
Common Equity Tier 1 capital ratio of 7.0%, a Tier 1 capital ratio of 8.5% and a minimum total capital ratio of
10.5% as of December 31, 2019, respectively.
Details of the Group’s capital adequacy ratio as of December 31, 2019 are as follows (Unit: Korean Won in
millions):
December 31, 2019
Tier 1 capital
Other Tier 1 capital
Tier 2 capital
Total risk-adjusted capital
Risk-weighted assets for credit risk
Risk-weighted assets for market risk
Risk-weighted assets for operational risk
Total risk-weighted assets
Common Equity Tier 1 ratio
Tier 1 capital ratio
Total capital ratio
19,135,300
3,340,252
4,639,519
27,115,071
209,802,895
5,586,757
12,656,301
228,045,953
8.39%
9.86%
11.89%
5.
STATEMENTS OF CASH FLOWS
(1) Details of cash and cash equivalents are as follows (Unit: Korean Won in millions):
Demand deposits
December 31, 2019
43,670
(2) Significant transactions not involving cash inflows and outflows from investing and financing activities are
as follows (Unit: Korean Won in millions):
Changes in right-of-use assets due to new contract
Changes in lease liabilities due to new contract
Comprehensive stock transfer
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
3,439
2,812
18,502,760
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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145
(3) Adjustments of liabilities from financing activities in current year are as follows (Unit: Korean Won in
millions):
For the period from January 11,2019 (date of incorporation) to December 31, 2019
Not involving cash inflows and outflows
Variation of
gains on
valuation of
hedged
items
Others
Debentures
Lease liabilities
Total
Beginning
-
-
-
Cash flow
947,604
(1,289)
946,315
Foreign
Exchange
-
-
-
-
-
-
75
2,857
2,932
Ending
947,679
1,568
949,247
6. FINANCIAL ASSETS AT FVTPL
(1) Details of financial assets at FVTPL are as follows (Unit: Korean Won in millions):
Financial assets at FVTPL
(2) Details of financial assets at FVTPL are as follows (Unit: Korean Won in millions):
December 31, 2019
Derivatives
December 31, 2019
9,434
9,434
(3) As of December 31, 2019, the Company does not hold financial assets designated at FVTPL.
7.
LOANS AND OTHER FINANCIAL ASSETS AT AMORTIZED COST
(1) Details of loans and other financial assets at amortized cost are as follows (Unit: Korean Won in millions):
December 31, 2019
Due from banks
Other financial assets
Total
(2) Details of due from banks are as follows (Unit: Korean won in millions):
December 31, 2019
Due from banks in local currency:
Due from depository banks
Allowance for credit loss
Total
1,129,738
139,465
1,269,203
1,130,000
(262)
1,129,738
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 146
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(3) Changes in the loss allowance and gross carrying amount of due from banks are as follows (Unit: Korean
Won in millions):
3.1
Allowance for credit losses
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net provision of loss allowance
Ending balance
3.2
Gross carrying amount
For the period from January 11, 2019 (date of
incorporation) to December 31, 2019
Stage 1
-
-
-
-
(262)
(262)
Stage 2
Stage 3
Total
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(262)
(262)
For the period from January 11,2019(date of
incorporation) to December 31, 2019
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net increase and decrease
Ending balance
Stage 1
-
-
-
-
1,130,000
1,130,000
Stage 2
Stage 3
-
-
-
-
-
-
(4) Details of other financial assets are as follows (Unit: Korean Won in million):
December 31, 2019
Receivables
Accrued income
Lease deposits
Allowance for credit loss
Total
Total
-
-
-
-
1,130,000
1,130,000
-
-
-
-
-
-
134,891
3,641
934
(1)
139,465
(5) Changes in the loss allowance and gross carrying amount of other financial assets are as follows (Unit:
Korean Won in millions):
5.1
Allowance for credit loss
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
Stage 1
Stage 2
Stage 3
Total
Beginning balance
Transfer to 12-month expected credit
losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net provision of loss allowance
Ending balance
-
-
-
-
(1)
(1)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1)
(1)
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 19 -
147
5.2
Gross carrying amount
For the period from January 11,2019
(date of incorporation) to December 31, 2019
Stage 1
Stage 2
Stage 3
Total
Beginning balance
Transfer to 12-month expected credit
losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net increase
Ending balance
-
-
-
-
139,466
139,466
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
139,466
139,466
8.
THE FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES
(1) The fair value hierarchy
The fair value hierarchy is determined by the levels of judgment involved in estimating fair values of financial
assets and liabilities. The specific financial instruments characteristics and market condition such as volume of
transactions and transparency are reflected to the market observable inputs. The fair value hierarchy gives the
highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities. The Company
maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value
of its financial assets and financial liabilities. Fair value is measured based on the perspective of a market
participant. As such, even when market assumptions are not readily available, the Company’s own assumptions
reflect those that market participants would use for measuring the assets or liabilities at the measurement date.
The fair value measurement is described in the one of the following three levels used to classify fair value
measurements:
•
•
•
Level 1— When fair value of a financial instrument is measured using its fair value at the quoted price in
the active market, the fair value of such financial instruments is classified as Level 1. The types of
financial instruments generally included in Level 1 are publicly traded equity securities, derivatives, and
debt securities issued by governmental bodies.
Level 2— When fair value of a financial instrument is measured using valuation techniques, the fair
value is classified as Level 2 when all major elements are market observable inputs. The types of
financial instruments generally included in Level 2 are most of the debt securities both in local and
foreign currencies and regular OTC derivatives such as swaps, forwards, options, etc.
Level 3— When fair value of a financial instrument is measured using valuation techniques, the fair
value is classified as Level 3 when one or more major elements are inputs that are not observable in the
market. The types of financial instruments generally included in Level 3 are non-public securities,
complex structured debt securities, and complex OTC derivatives.
The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the
level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value
measurement. The Company’s assessment of the significance of a particular input to a fair value measurement in
its entirety requires judgment and consideration of inherent factors of the asset or liability.
(2) Fair value hierarchy of financial assets measured at fair value are as follows (Unit: Korean Won in
millions):
Financial assets:
Financial assets at FVTPL:
Derivative assets
December 31, 2019
Fair value
Level 1
Level 2
Level 3
Total
-
-
9,434
9,434
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review
148
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Financial assets measured at FVTPL are recognized at fair value. Fair value refers to the price that will be paid at
the measurement date as the assets are sold or the liabilities transferred in a normal transaction between market
participants.
The fair values of financial instruments are measured using quoted market price in active markets. In case there
is no active market for financial instruments, the Company determines the fair value using valuation methods.
Valuation methods and input variables for financial assets and liabilities that are measured at fair value are given
as follows:
Derivatives
Valuation methods
The fair value is measured considering the
price and volatility of the underlying asset
using the Binomial Tree, a commonly used
technique in the market
Input variables
Price of underlying asset,
volatility, risk-free market return,
corporate bond yield rate
Level 3 financial asset valuation techniques measured at fair value that are significant but unobservable inputs
variables are as follows:
Fair value
valuation
technique
Optional pricing
model etc.
Type
Stock-
related
Derivative
assets
Significant but
not observable
input variables Range
Price and
volatility of
underlying
asset
12.58%
~15.38
%
Correlation between unobservable
inputs and fair value
The higher the price and volatility of
the underlying asset, the greater the
change in fair value
The fair value of financial assets classified as level 3 uses external valuation figures.
(3) Changes in financial assets measured at fair value classified into Level 3 are as follows (Unit: Korean Won
in millions):
For the period from January 11, 2019(date of incorporation) to December 31, 2019
Net
Income
(*)
Other
comprehensive
income
Purchases/
issuances
Disposals/
settlements
Transfer to
or out of
Level 3
Ending
Beginning
-
9,434
-
-
-
-
9,434
Financial assets:
Financial assets at
FVTPL
Derivatives assets
(*) The gain amounting to 9,434 million Won for the period from January 11, 2019 (date of incorporation) to
December 31, 2019, which is from financial assets that the company holds as at the end of the periods, has been
recognized in net gain on financial instruments at FVTPL in the separate statement of comprehensive income.
(4) The results of a sensitivity analysis on the rational fluctuation in the unobservable inputs used for measuring
Level 3 financial instruments are as follows.
The sensitivity analysis of the financial instruments has been performed by classifying favorable and unfavorable
changes based on how changes in unobservable inputs would lead to the fluctuations of financial instruments’
value. When the fair value of a financial instrument is affected by more than one unobservable input, the below
table reflects the most favorable or the most unfavorable circumstances. The sensitivity analysis was performed
for level 3 financial instruments whose fair value changes are recognized in profit or loss and includes stock-
related derivatives.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 21 -
149
The following table shows the sensitivity analysis to disclose the effect of reasonably possible volatility on the
fair value of Level 3 financial instruments (Unit: Korean Won in millions):
Financial assets:
Financial assets at FVTPL
Derivative assets (*)
As of December 31, 2019
Net income (loss)
Favorable
Unfavorable
943
(943)
(*) Fair value changes of equity related derivatives assets and liabilities are calculated by increasing or decreasing
historical volatility of the stock price and correlation, which are major unobservable variables, by 10%, respectively.
(5) Fair value and carrying amount of financial assets and liabilities that are recorded at amortized cost are as
follows (Unit: Korean Won in millions):
Financial assets:
Loans and other financial assets at
amortized cost (*)
Financial liabilities:
Debentures
Other financial liabilities (*)
December 31, 2019
Fair value
Level 1
Level 2
Level 3
Total
Book
value
-
-
-
-
1,269,203
1,269,203
1,269,203
951,387
-
-
10,745
951,387
10,745
947,679
10,745
(*) For loans, other financial assets and liabilities at amortized cost classified as Level 3, the carrying amount was
disclosed at fair value considering the carrying amount as an approximation of fair value.
The fair values of financial instruments are measured using quoted market price in active markets. In case there
is no active market for financial instruments, the company determines the fair value using valuation methods.
For the disclosed items in which book value is considered to be the approximate value of fair value, valuation
techniques and input variables are not disclosed. Valuation techniques for the fair value of financial assets and
liabilities that are recorded at amortized cost are as follows.:
Debentures
Valuation methods
The fair value is measured by discounting the projected cash flows of debt products by applying
the market discount rate that is reflecting credit rating of the Company.
(6) Financial instruments by category
Carrying amounts of financial assets and liabilities by category are as follows (Unit: Korean Won in millions):
Financial assets:
Due from banks
Derivatives
Other financial assets at amortized
cost
Total
Financial liabilities:
Debentures
Other financial liabilities
Total
December 31, 2019
Financial assets at
FVTPL
Financial assets at
amortized cost
Total
-
9,434
-
9,434
1,129,738
-
1,129,738
9,434
139,465
1,269,203
139,465
1,278,637
December 31, 2019
Financial liabilities at amortized cost
947,679
10,745
958,424
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(7)
Income or expense from financial assets and liabilities by each category are as follows (Unit: Korean Won
in millions):
For the period from January 11, 2019(date of incorporation) to December 31, 2019
Interest
income(expense)
-
7,741
(7,701)
40
Reversal of
(provision for)
credit losses
Others
Total
-
(263)
-
(263)
9,434
-
-
9,434
9,434
7,478
(7,701)
9,211
Financial assets at FVTPL
Loans and other financial
assets at amortized cost
Financial liabilities at
amortized cost
Total
9.
INVESTMENTS IN SUBSIDIARIES
(1)
Investments in subsidiaries are as follows (Unit: Korean Won in millions):
Subsidiaries (*1)
Location
Capital
stock
Main business
December 31, 2019
Percentage
of
ownership
(%)(*2)
Number of
shares
Woori Bank
Woori Card Co., Ltd.
Woori Investment Bank Co., Ltd.
Woori FIS Co., Ltd.
Woori Finance Research Institute Co., Ltd.
Woori Credit Information Co., Ltd.
Woori Fund Service Co., Ltd.
Woori Asset Trust Co., Ltd
Woori Asset Management Corp.
Woori Private Equity Asset Management
Co., Ltd.
Woori Global Asset Management Co.,
Ltd.
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
3,381,400
Finance
676,000,000
896,300
Finance
179,266,200
337,100 Other credit finance
System software
24,500
development &
maintenance
403,404,538
4,900,000
3,000 Other service business
600,000
5,000 Credit information
1,008,000
10,000
15,300
20,000
30,000
Finance
Finance
Finance
Finance
2,000,000
1,560,000
67.2
2,920,000
6,000,000
73.0
100
Korea
20,000
Finance
4,000,000
100
(*1) Only subsidiaries invested directly by the company are included.
(*2) The percentage is based on the effective interest rate relative to the number of outstanding shares.
100
100
59.8
100
100
100
100
Financial
statements date
of use
December
31,2019
December
31,2019
December
31,2019
December
31,2019
December
31,2019
December
31,2019
December
31,2019
December
31,2019
December
31,2019
December
31,2019
December
31,2019
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 23 -
151
(2) Changes in the carrying value of investments in subsidiaries are as follows (Unit: Korean Won in millions):
For the period from January 11, 2019 (date of incorporation) to December 31, 2019
Beginning balance
Acquisition
Disposal
Ending balance
Woori Bank(*1)
Woori Card Co., Ltd.(*2)
Woori Investment Bank Co.,
Ltd.(*2)
Woori FIS Co., Ltd.(*1)
Woori Finance Research Institute
Co., Ltd.(*1)
Woori Credit Information Co.,
Ltd.(*1)
Woori Fund Service Co., Ltd.(*1)
Woori Asset Trust Co., Ltd(*5)
Woori Asset Management Corp.(*3)
Woori Private Equity Asset
Management Co., Ltd.(*1)
Woori Global Asset Management
Co., Ltd.(*4)
Total
17,921,151
-
-
21,754
1,677
16,466
13,939
-
-
7,797
1,118,367
392,795
-
-
-
-
224,198
122,449
-
-
17,982,784
33,000
1,890,809
-
-
-
-
-
-
-
-
-
-
-
-
17,921,151
1,118,367
392,795
21,754
1,677
16,466
13,939
224,198
122,449
7,797
33,000
19,873,593
(*1) The Company acquired through the comprehensive stock transfer when established.
(*2) Woori Card Co., Ltd. And Woori investment Bank Co., Ltd. were transferred from second-tier subsidiaries into
subsidiaries in September, 2019.
(*3) The company newly acquired 73% interest in Tongyang Asset Management Corporation and changed the name as
Woori Asset Management Corporation.
(*4) The remaining payment was completed in August, 2019 after the request for the change of major shareholder was
approved by the Financial Service Commission in July, 2019. The name has changed to Woori Global Asset
Management Co., Ltd after acquiring.
(*5) The name has changed to Woori Asset Trust Co., Ltd., after acquiring 67.2% interest of Kukje Trust Co. in
December 2019.
10. PREMISES AND EQUIPMENT
(1) Details of premises and equipment are as follows (Unit: Korean Won in millions):
Premises and equipment
(ownership)
Right-of-use asset
Total
Building
December 31, 2019
Properties for
business use
Leasehold
Improvement
-
1,436
1,436
3,767
384
4,151
1,796
-
1,796
Total
5,563
1,820
7,383
(2) Premises and equipment (ownership)
2.1 Details of premises and equipment (ownership) are as follows (Unit: Korean Won in millions):
Acquisition cost
Accumulated
depreciation
Net carrying value
Properties for business use
4,538
(771)
3,767
December 31, 2019
Leasehold Improvement
Total
2,184
(388)
1,796
6,722
(1,159)
5,563
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2.2
Details of changes in premises and equipment (ownership) are as follows (Unit: Korean Won in
millions):
For the period from January 11, 2019 (date of incorporation) to December 31, 2019
Properties for business use
-
4,538
(771)
3,767
-
2,184
(388)
1,796
Leasehold Improvement
-
6,722
(1,159)
5,563
Total
Beginning balance
Acquisition
Depreciation
Ending balance
(3) Right-of-use asset
3.1 Details of right-of-use asset are as follows (Unit: Korean Won in millions):
Acquisition cost
Accumulated
depreciation
Net carrying value
Building
2,871
(1,435)
1,436
December 31, 2019
Properties for business use
568
(184)
384
Total
3,439
(1,619)
1,820
3.2 Details of changes in right-of-use asset are as follows (Unit: Korean Won in millions):
Beginning balance
New contract
Depreciation
Ending balance
For the period from January 11, 2019 (date of incorporation) to December 31, 2019
Building
-
2,871
(1,435)
1,436
Properties for business use
-
568
(184)
384
Total
-
3,439
(1,619)
1,820
11. INTANGIBLE ASSETS
(1) Details of intangible assets are as follows (Unit: Korean Won in millions):
Acquisition cost
Accumulated
amortization
Net carrying value
Software
December 31, 2019
Development Cost
Total
2,729
(1,144)
1,585
1,901
(176)
1,725
4,630
(1,320)
3,310
(2) Details of changes in intangible assets are as follows (Unit: Korean Won in millions):
For the period from January 11, 2019 (date of incorporation) to December 31, 2019
Development Cost
Software
Total
Beginning balance
Acquisition
Amortization
Ending balance
-
2,729
(1,144)
1,585
-
1,901
(176)
1,725
-
4,630
(1,320)
3,310
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 25 -
153
12. DEBENTURES
Details of debentures are as follows (Unit: Korean Won in millions):
Debentures in local currency:
Others
Deduction:
Discounts on bond
Total
13. PROVISIONS
December 31, 2019
Interest rate (%)
Amount
2.13%~2.55%
950,000
(2,321)
947,679
(1) Details of provisions are as follows (Unit: Korean Won in millions):
Asset retirement obligation
December 31, 2019
(2) Changes in asset retirement obligation are as follows (Unit: Korean Won in millions):
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
Beginning balance
Provisions provided
Amortization
Ending balance
600
-
588
12
600
The amount of the asset retirement obligation is the present value of the best estimate of expected future
expenditure to settle the obligation – arising from leased premises as of December 31, 2019, discounted by
appropriate discount rate. Expenditures on the asset retirement obligation are expected to take place at the end of
the lease contract for leased assets and the average value of the actual recovery construction cost of the
subsidiaries where the restoration work took place over the past three years and the average inflation rate of the
previous 3-year period were used to calculate the expected expenditures.
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14. NET DEFINED BENEFIT LIABILITY
The characteristics of the Company’s defined benefit retirement pension plans are as follows:
Employees and directors with one or more years of service are entitled to receive a payment upon termination of
their employment, based on their length of service and rate of pay at the time of termination. The assets of the
plans are measured at their fair value at the end of reporting date. The plan liabilities are measured using
actuarial assumptions (projected unit credit method which considers the increase of projected earnings) that give
the best estimate of the future cash flows that will arise under the plan liabilities.
The Company is exposed to various risks through defined benefit retirement pension plan, and the most
significant risks are as follows:
Volatility of asset
The defined benefit obligation was estimated with a discount rate
calculated based on blue chip corporate bonds earnings. A deficit may
occur if the rate of return on plan assets falls short of the discount rate.
Decrease in profitability of blue
chip bonds
A decrease in profitability of blue chip bonds will be partially offset by
some increase in the value of debt securities that the employee benefit
plan owns but will bring an increase in the defined benefit obligation.
Risk of inflation
Most defined benefit obligations are related to inflation rate; the higher
the inflation rate is, the higher the level of liabilities. Therefore, deficit
occurs in the defined benefit retirement pension plans if an inflation
rate increases.
(1) Details of net defined benefit liability are as follows (Unit: Korean Won in millions):
Present value of defined benefit obligation
Fair value of plan assets
Net defined benefit liability
December 31, 2019
14,174
(10,692)
3,482
(2) Changes in the carrying value of defined benefit obligation are as follows (Unit: Korean Won in millions):
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
Beginning balance
Succession from transferred-out company(to
transferred-in company) (*)
Effect of new/transfer
Current service cost
Interest cost
Remeasurements
Financial assumptions
Demographic assumptions
Experience adjustments
Retirement benefit paid
Others
Ending balance
-
8,276
3,360
1,415
253
(457)
542
762
(54)
77
14,174
(*) 601 million won that succeeded to the transferred in company regarding to employees transferred during the current
term has been deducted.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 27 -
155
(3) Changes in the plan assets are as follows (Unit: Korean Won in millions):
Beginning balance
Succession from transferred-out company (*)
Interest income
Remeasurements
Employer’s contributions
Ending balance
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
-
8,877
129
(24)
1,710
10,692
(*) 601 million won is supposed to succeed to the transferred-in company regarding to employees transferred during the
current term.
(4) Plan assets consist of fixed deposits and etc. as of December 31, 2019 and the realized return on plan assets
amount to 105 million Won for the period from January 11, 2019 (date of incorporation) to December 31,
2019.
Meanwhile, the contribution expected to be paid in the next accounting year amounts to 1,629 million Won.
(5) Amounts related to the defined benefit plan that are recognized in the separate statements of net income and
total comprehensive income are as follows (Unit: Korean Won in millions):
Current service cost
Effect of new/transfer
Net interest income
Cost recognized in net income
Remeasurements(*)
Cost recognized in total comprehensive income
(*) This is an amount before considering the tax effects.
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
1,415
3,360
124
4,899
871
5,770
(6) Key actuarial assumptions used in defined benefit liability measurement are as follows:
Discount rate
Future wage growth rate
Mortality rate
Retirement rate
December 31, 2019
2.40%
5.27%
Issued by Korea Insurance Development Institute
Issued by Korea Insurance Development Institute
The weighted average maturity of the defined benefit obligation is 10.98 years.
(7) The sensitivity to actuarial assumptions used in the assessment of defined benefit obligation is as follows
(Unit: Korean Won in millions):
Discount rate
Future wage growth rate
Increase by 1% point
Decrease by 1% point
Increase by 1% point
Decrease by 1% point
December 31, 2019
(1,367)
1,596
1,535
(1,345)
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15. OTHER FINANCIAL LIABILITIES AND OTHER LIABILITIES
Other financial liabilities and other liabilities are as follows (Unit: Korean Won in millions):
December 31, 2019
Other financial liabilities:
Accounts payable
Accrued expenses
Lease liabilities
Other miscellaneous financial liabilities
Sub-total
Other liabilities:
Other miscellaneous liabilities
Total
16. DERIVATIVES
2,424
6,651
1,568
102
10,745
4,142
14,887
Details of derivative assets as of December 31, 2019 are as follows (Unit: Korean Won in millions):
Stock forwards
Contract price
117,535
Assets
For trading
9,434
Derivatives held for trading are classified to financial assets at FVTPL in the statements of financial position
(see Note 6).
17. EQUITY
(1) Details of equity are as follows (Unit: Korean Won in millions):
Capital stock
Hybrid security
Capital surplus (*)
Capital adjustment
Accumulated other comprehensive income
Retained Earnings
Total equity
December 31, 2019
3,611,338
997,544
14,874,084
-
(631)
623,930
20,106,265
(*) The amount is paid-in capital in excess of par value due to comprehensive stock transfer at the date of establishment
and due to the issuance of new shares at the time of stock exchange with Woori Card shareholders during the
current term.
(2) The number of shares authorized and others are as follows:
Shares of common stock authorized
Par value
Shares of common stock issued
Capital
December 31, 2019
4,000,000,000
5,000 won
722,267,683
3,611,338 million Won
(3) The Company issued 42,103,377 new shares in the stock exchange process with the shareholders of Woori
Card during the current term, which changed the total number of issued shares from 680,164,306 as of the
date of establishment to 722,267,683 as of the end of the current term.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 29 -
157
(4) Hybrid security
Details of bond-type hybrid tier 1 securities classified as equity are as follows (Unit: Korean Won in millions)
Type
Securities in local
currency
Issue Date
2019-07-18
2019-10-11
Maturity
-
-
Interest Rate (%)
3.49
3.32
Issue Cost
Total
December 31, 2019
500,000
500,000
(2,456)
997,544
The hybrid security has no fixed maturity but can be called in advance after 5 years from the date of issuance.
(5) Accumulated other comprehensive income
Changes in the accumulated other comprehensive income are as follows (Unit: Korean Won in millions):
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
Beginning
balance
Decrease
Income tax
effect
Ending
balance
-
(871)
240
(631)
Remeasurement loss related to
defined benefit plan
(6) Regulatory Reserve for Credit loss
In accordance with Paragraphs 1 and 3 of Article 27 of the Regulation on the Supervision of Financial Holding
Companies, the Company discloses the regulatory reserve for credit loss.
6.1 Balance of the planned regulatory reserve for credit loss is as follows (Unit: Korean Won in millions):
Regulatory reserve for credit loss
Planned provision of regulatory reserve for credit loss
Ending balance of regulatory reserve for credit loss
December 31, 2019
-
692
692
6.2 Planned reserves provided, adjusted net income after the planned reserves provided and adjusted EPS
after the planned reserves provided are as follows (Unit: Korean Won in millions, except for EPS
amount):
Net income
Regulatory reserve for credit loss to be reserved
Adjusted net income after the provision of regulatory reserve
Adjusted EPS after the provision of regulatory reserve
(Unit: Korean Won) (*)
(*) The dividends of hybrid security are excluded.
For the period from January 11, 2019
(date of incorporation) to December 31,
2019
628,293
692
627,601
899
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(7) Statement of appropriations of retained earnings (plan) is as follows (Unit: Korean Won in millions):
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
(Expected date of disposal: March 25, 2020)
Unappropriated retained earnings:
Dividend on hybrid equity securities
Net income
Appropriation of retained earnings:
Legal reserve
Regulatory reserve for credit loss
Cash dividend (dividend per share (%))
2019: 700 won (14%),
Unappropriated retained earnings to be carried forward
to next year
(8) Details of treasury stocks are as follows (Unit: Shares, Korean Won in millions):
(4,363)
628,293
623,930
62,830
692
505,587
569,109
54,821
Beginning
Repurchase(*)
Retirement
Ending
December 31, 2019
Number of shares
Book value
-
2
-
2
-
-
-
-
(*) Treasury stocks have been occurred for the provision for odd-lot payment incurred during the partial stock
replacement of the shareholders who possess physical stock certificate.
18. NET INTEREST INCOME
(1)
Interest income recognized is as follows (Unit: Korean Won in millions):
Loans and other financial assets at amortized cost:
Interest on due from banks
Interest on other receivables
Total
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
7,723
18
7,741
(2)
Interest expense recognized is as follows (Unit: Korean Won in millions):
Interest on borrowings
Interest on debentures
Interest on lease liabilities
Other interest expense
Total
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
495
7,149
45
12
7,701
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 31 -
159
19. NET FEES AND COMMISSIONS LOSS
(1) There is no fees and commissions income for the period from January 11, 2019 (date of incorporation) to
December 31, 2019.
(2) Details of fees and commissions expense incurred are as follows (Unit: Korean Won in millions):
Fees and commissions paid
Others
Total
20. DIVIDEND INCOME
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
8,202
7,631
15,833
Details of dividend income recognized are as follows (Unit: Korean Won in millions):
Dividend income recognized from investments in
subsidiaries
676,000
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
21. NET GAIN OR LOSS ON FINANCIAL INSTRUMENTS AT FVTPL
(1) Details of gain or loss related to net gain or loss on financial instruments at FVTPL are as follows (Unit:
Korean Won in millions):
Gains on financial instruments at fair value through
profit or loss mandatorily measured at fair value
Total
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
9,434
9,434
(2) Details of net gain or loss on financial instrument at FVTPL are as follows (Unit: Korean Won in millions):
Derivatives
(for trading)
Equity forward Gain on valuation
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
9,434
22. IMPAIRMENT LOSS DUE TO CREDIT LOSS
Impairment loss due to credit loss are as follows (Unit: Korean Won in millions):
Impairment loss due to credit loss on loans and other
financial assets at amortized cost
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
263
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23. GENERAL AND ADMINISTRATIVE EXPENSES
(1) Details of general and administrative expenses are as follows (Unit: Korean Won in millions):
For the period from January 11, 2019
(date of incorporation) to December
31, 2019
Employee
benefits
Short-term
employee benefits
Salaries
Employee fringe
benefits
Retirement benefit service costs
Share-based payment
Sub-total
Depreciation and amortization
Other general
and
administrative
expenses
Rent
Taxes and public dues
Service charges
Computer and IT related
Telephone and communication
Operating promotion
Advertising
Printing
Traveling
Supplies
Insurance premium
Reimbursement
Vehicle maintenance
Others
Sub-total
Total
(2) Performance condition share-based payment
16,706
5,340
4,899
819
27,764
4,098
714
375
2,290
1,654
482
645
65
76
373
131
280
847
129
18
8,079
39,941
Details of performance condition share-based payment granted to executives as of December 31, 2019 are as
follows.
2.1 Share-based payment
Subject to
Type of payment
Performance evaluation period
Base date for payment
Number of shares measured as of the closing date (*)
Shares granted for the year 2019
Cash-settled
January 11, 2019(date of incorporation)
~ December 31, 2022
January 1, 2023
78,023
(*) The number of payable stocks is granted at the initial contract date and the payment rate is determined based on the
achievement of the pre-determined performance targets. Performance is evaluated as long-term performance
indication including relative shareholder return, net income, return on equity (ROE), non-performing loan ratio and
job performance.
2.2 The Company accounts for performance condition share-based payment according to the cash-settled
method and the fair value of the liabilities is reflected in the compensation costs by re-measuring per
every closing period. As of December 31, 2019, expenses and the book value of the liabilities related
to the performance condition share-based payment recognized by the Company is 819 million Won.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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161
24. NON-OPERATING LOSS
(1) Details of other non-operating income and expenses recognized are as follows (Unit: Korean Won in
millions):
Other non-operating income
Other non-operating expenses
Total
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
(2) Details of other non-operating income recognized are as follows (Unit: Korean Won in millions):
Others
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
(3) Details of other non-operating expenses recognized are as follows (Unit: Korean Won in millions):
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
Donation
25. INCOME TAX EXPENSE
(1) Details of income tax expense are as follows (Unit: Korean Won in millions):
5
(755)
(750)
5
755
For the period from January 11, 2019
(date of incorporation) to December 31,
2019
Current tax expense:
Current tax expense in respect of the current period
Sub-total
Deferred tax expense:
Deferred tax assets (liabilities) relating to the origination
and reversal of temporary differences
Income tax expense relating to items that are recognized
directly in equity
Income tax expense
-
-
154
240
394
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 162
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(2) The relationship between income before income tax expense deduction and income tax expense in the current
comprehensive income statement is as follows:
Net income before income tax expense
Tax calculated at statutory tax rate (*)
Adjustments:
Effects of income that is exempt from taxation
Effect of expenses that are not deductible in
determining taxable profit
Effect of corporate tax dues to consolidate tax plans
Others
Income tax expense
Effective tax rate
Sub-total
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
628,687
165,527
(179,186)
1,190
15,839
24
(162,133)
394
0.1%
(*) The corporate tax rate is 11% up to 200 million Won in tax basis, 22% over 200 million Won to 20 billion Won,
24.2% over 20 billion Won to 300 billion Won and 27.5% over 300 billion Won.
(3) Details of changes in deferred income tax assets and liabilities for the period from January 11, 2019(date of
incorporation) to December 31, 2019 are as follows (Unit: Korean Won in millions):
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
Beginning balance
Recognized as
income (expense)
Recognized as
other
comprehensive
income (expense)
Ending
Balance
Gain (loss) on
valuation of
derivatives
Provision for loan
losses
Defined benefit
liability
Deposits with
employee
retirement
insurance trust
Provisions
Share based
payment
Others
Net deferred tax
assets(liabilitie
s) in total
-
-
-
-
-
-
-
-
(2,594)
72
1,389
(736)
165
225
1,085
(394)
-
-
233
7
-
-
-
240
(2,594)
72
1,622
(729)
165
225
1,085
(154)
(4) Unrealizable temporary differences are as follows (Unit: Korean Won in millions):
Deductible temporary differences
Taxable temporary differences
Total
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
3,222
(7,916,351)
(7,913,129)
No deferred income tax asset has been recognized for the deductible temporary difference of 3,222million Won
associated with investments in subsidiaries as of December 31, 2019, because it is not probable that the
temporary differences will be reversed in the foreseeable future.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
- 35 -
163
No deferred income tax liability has been recognized for the taxable temporary difference of 7,916,351 million
Won associated with investment in subsidiaries as of December 31, 2019, due to the following reasons:
- The Company is able to control the temporary difference of extinguishment.
- It is probable that the temporary difference will not be reversed in the foreseeable future.
(5) Details of accumulated deferred tax charged directly to other equity are as follows (Unit: Korean Won in
millions):
Remeasurement of the net defined benefit liability
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
240
(6) Current tax assets and liabilities are as follows (Unit: Korean Won in millions)
Current tax assets
Current tax liabilities
26. EARNINGS PER SHARE
December 31, 2019
-
133,526
(1) Basic earnings per share is calculated by dividing net income by weighted-average number of common
shares outstanding (Unit: Korean Won in millions, except for earnings per share and number of shares):
Net income for the period attributable to owners
Dividends to hybrid securities
Net income attributable to common shareholders
Weighted-average number of common shares outstanding
(Unit: shares in million)
Basic earnings per share (Unit: Korean Won)
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
628,293
(4,363)
623,930
694
900
(2) Weighted-average number of common shares outstanding as of December 31, 2019 is as follows.
For the period from January 11,2019 (date of incorporation) to December
31, 2019
Period
Number of
shares
Dates
Accumulated number
of shares outstanding
during period
2019-01-11 ~ 2019-12-31
680,164,306
355
241,458,328,630
Common shares at the time
of incorporation
Stock issuance
(Comprehensive stock
exchange)
Purchase of treasury stock
Purchase of treasury stock
2019-09-10 ~ 2019-12-31
2019-08-26 ~ 2019-12-31
2019-12-13 ~ 2019-12-31
42,103,377
(1)
(1)
113
128
19
Sub-total (①)
Weighted average number of common shares outstanding (②=(①/355)
4,757,681,601
(128)
(19)
246,216,010,084
693,566,226
Diluted earnings per share is equal to basic earnings per share because there is no dilution effect for the period
from January 11, 2019 (date of incorporation) to December 31, 2019.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 164
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27. CONTINGENT LIABILITIES AND COMMITMENTS
(1) As of December 31, 2019, the Company has no litigation cases in progress.
(2) Details of agreements with financial institutions as of December 31, 2019 are as follows (Unit: Korea Won in
millions)
Loan
Financial institutions
Standard Chartered
Bank Korea Ltd.
Kookmin Bank
Total
(3) Other agreements
December 31, 2019
Line of credit
Loan balance
65,000
35,000
100,000
-
-
-
The Company decided to enter into a stock sales agreement with a major shareholder of Kukje Trust Co., Ltd. to
acquire 44.5% interest (58.6% of voting rights) during July, 2019, and to acquire additional 21.3% interest
(28.0% of voting rights) after a certain period. As a result, the Company acquired the interest of the first sales
agreement in December 2019 and is planning to acquire the interest of the second sales agreement after a certain
period.
The Company recognized 9,434 million Won of derivative assets according to the agreement as of December 31,
2019 (see Note 16).
28. RELATED PARTY TRANSACTIONS
Related parties of the Company as of December 31, 2019 and its assets and liabilities recognized as of December
31, 2019, major transactions with related parties for the period from January 11, 2019 (date of incorporation) to
December 31, 2019 and compensation to key management are as follows:
(1) Related parties as of December 31, 2019 are as follows:
Subsidiaries
Related parties
Woori Bank, Woori Card Co., Ltd., Woori Investment Bank Co., Ltd., Woori FIS
Co., Ltd., Woori Finance Research Institute Co., Ltd., Woori Credit Information
Co., Ltd., Woori Fund Service Co., Ltd., Woori Asset Trust Corp. Ltd., Woori
Asset Management Corp., Woori Private Equity Asset Management Co., Ltd.,
Woori Global Asset Management Co., Ltd., Woori America Bank, PT Bank Woori
Saudara Indonesia 1906 Tbk, Woori Global Markets Asia Limited, Woori Bank
China Limited, AO Woori Bank, Banco Woori Bank do Brasil S.A., Korea BTL
Infrastructure Fund, Woori Finance Cambodia PLC., Woori Finance Myanmar Co.,
Ltd., Wealth Development Bank, Woori Bank Vietnam Limited, WB Finance Co.,
Ltd., Woori Bank Europe, TUTU Finance-WCI Myanmar Co., Ltd., Woori Bank
Principal and Interest Guaranteed Trust and Woori Bank Principal Guaranteed
Trust (“Consolidated trusts”), Kumho Trust First Co., Ltd. and 62 SPCs, Heungkuk
Woori Tech Company Private Placement Investment Trust No. 1 and 12 beneficiary
certificates
Associates
Woori Service Networks Co., Ltd., Korea Credit Bureau Co., Ltd., Korea Finance
Security Co., Ltd., Lotte card Co., Ltd, Chin Hung International Inc., 2016KIF-
IMM Woori Bank Technology Venture Fund, K BANK Co., Ltd., Well to Sea No.
3 Private Equity Fund, and others (Dongwoo C & C Co., Ltd. and 31 associates)
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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165
(2) Assets and liabilities from transactions with related parties are as follows (Unit: Korean Won in millions):
Title of account
Cash and cash equivalents
Other financial assets
Allowance for credit losses
Other financial liabilities
December 31, 2019
43,670
1,229,181
(263)
601
Related party
Woori Bank
Woori Card Co., Ltd.
Woori FIS Co., Ltd.
Woori Finance Research Institute
Co., Ltd.
Woori Credit
Information Co., Ltd.
Woori Fund Service
Co., Ltd.
Other financial assets
Other financial liabilities
Other financial assets
Other financial liabilities
Other financial assets
Other financial liabilities
Other financial assets
Other financial assets
37,754
267
1,386
190
21
1,320
568
556
64
Woori Service Networks Co., Ltd.
Other financial liabilities
(3) Gains or losses from transactions with related parties are as follows (Unit: Korean Won in millions):
Related party
Woori Bank
Title of account
Interest income
Dividend income
Interest expenses(*)
Fees and commissions expense
Impairment losses on credit loss
General and administrative expenses(*)
Woori FIS Co., Ltd.
General and administrative expenses
Woori Finance Research Institute
Co., Ltd.
Fees and commissions expenses
Woori Service Networks Co., Ltd.
General and administrative expenses
For the period from
January 11, 2019
(date of incorporation)
to December 31, 2019
7,741
676,000
47
4
263
2,365
1,492
5,400
775
(*) The depreciation of right-of-use assets and interest expense of lease liabilities arising from lease transactions during
the current term are included.
(4) The details of the right-of-use assets and lease liabilities due to lease transactions with related parties as of
the end of the current tem are as follows (Unit: Korea Won in millions):
Related party
Woori Bank
Title of account
Right-of-use assets(*)
Lease liabilities
(*) Asset retirement obligations due to lease transactions are included.
For the period from
January 11, 2019
(date of incorporation)
to December 31, 2019
1,436
1,164
(5) There is no major borrowing and loan transactions with the related parties during the period from January
11, 2019 (date of incorporation) to December 31, 2019.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review 166
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(6) There are no guarantees provided to the related parties. The unused commitments provided from the related
parties are as follows (Unit: Korean Won in millions):
Woori Card Co., Ltd.
December 31, 2019
Warranty
495
Unused commitments
(7) Details of compensation to key management are as follows (Unit: Korean Won in millions):
Short-term employee benefits
Retirement benefit service costs
Share-based payment
Total
For the period from January 11, 2019
(date of incorporation)
to December 31, 2019
3,683
419
529
4,631
Key management includes registered executives and non-registered executives. As of December 31, 2019,
there is no assets, liabilities, allowance and impairment loss due to credit losses from transactions with key
management.
(8) Details of equity transactions with related parties for the period from January 11,2019 (date of
incorporation) to December 31, 2019 are as follows (Unit: Korean Won in millions):
Company
Transaction details
December 31, 2019
Purchase of investment interest Woori Bank
(Subsidiaries)
Purchase of investment interest Woori Bank
(Subsidiaries)
Purchase of investment interest Woori Bank
(Subsidiaries)
Woori Card Co. ltd stocks
(Investments in subsidiaries)
Woori investment bank
stocks (Investments in
subsidiaries)
Kukje Asset Trust Co.
stocks (Investments in
subsidiaries) (*)
(*) After the acquisition of the shares, the name has changed to Woori Asset Trust Co., Ltd.
1,118,367
392,795
23,550
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 39 -
167
29. LEASES
(1) Details of lease liability are as follows (Unit: Korean Won in millions):
Lease payments
Within one year
After one year but within five years
December 31, 2019
1,341
249
(2) Total cash outflows from lease for the period from January 11, 2019 (date of incorporation) to December
31, 2019 are as follows (Unit: Korean Won in millions):
Cash outflows from lease
For the period from January 11, 2019
(date of incorporation) to December 31, 2019
1,289
(3) The Company recognized the amount of 95 million Won as the lease payments for low-value assets for the
period from January 11, 2019 (date of incorporations) to December 31, 2019. There are no lease payments
that are not included in total lease payments considered for lease liability measurement as they are short-
term leases.
30. EVENTS AFTER THE REPORTING PERIOD
The Coronavirus disease (COVID-19) outbreak in January, 2020 is having a negative impact on the global
economy, including Korea. As a result, the macroeconomic environment is unstable overall. The Company is
closing monitoring the situation; however, the impact on the Company due to the Coronavirus cannot be
estimated as of the financial statements approval for the issuance date.
Woori OverviewBusiness OperationsSeparate Financial StatementsFinancial Review Deloitte Anjin LLC
9F., One IFC,
10, Gukjegeumyung-ro,
Youngdeungpo-gu, Seoul
07326, Korea
Tel: +82 (2) 6676 1000
Fax: +82 (2) 6674 2114
www.deloitteanjin.co.kr
168
INDEPENDENT AUDITORS’ REPORT
INDEPENDENT AUDITORS’ REPORT
English Translation of a Report Originally Issued in Korean on March 16, 2020
To the Shareholders and the Board of Directors of Woori Financial Group Inc.
Report on the Audited Consolidated Financial Statements
Audit Opinion
We have audited the accompanying consolidated financial statements of Woori Financial Group and its
subsidiaries (the “Group”), which comprise the consolidated statement of financial position as of December
31, 2019 and December 31, 2018, respectively, and the consolidated statement of comprehensive income,
consolidated statement of changes in equity and consolidated statement of cash flows, for the years then
ended, and a summary of significant accounting policies and other explanatory information.
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial
position of the Group as of December 31, 2019 and December 31, 2018, respectively, and its financial
performance and its cash flows for the years then ended in accordance with Korean International Financial
Reporting Standards (“K-IFRS”).
Basis for Audit Opinion
We conducted our audits in accordance with the Korean Standards on Auditing (“KSAs”). Our
responsibilities under those standards are further described in the Auditors Responsibilities for the Audit of
the Financial Statements section of our report. We are independent of the Group in accordance with the
ethical requirements, including those related to independence, that are relevant to our audit of the
consolidated financial statements in the Republic of Korea as required by prevailing audit regulations. We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
The key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the consolidated financial statements of the current period. These matters were addressed in the
context of our audit of the consolidated financial statements as a whole, and in forming our audit opinion
thereon, and we do not provide a separate opinion on these matters.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
169
Allowance for credit loss in accordance with K-IFRS 1109 ‘Financial Instruments’
Key audit matter description
As described in notes 2, 3, 4 and 10, the Group estimates and records an allowance for loans based on
expected credit losses. In order to estimate expected credit losses, the Group segregated its portfolio in
retail, corporate and credit card loans. Loans measured at amortized cost are KRW 272,607,264 million,
with loan loss allowances of KRW 1,575,020 million, as of December 31, 2019. Both the individual and
collective impairment methodologies must consider historical losses adjusted for forward looking
information and include multiple scenarios for macroeconomic factors. The allowance for certain loans is
measured, at least in part, based on the valuation of collaterals which must take into account an expectation
of when and for how much the collateral will be sold.
There was a significant amount of judgment required by management when determining the appropriateness
of the forward looking and macroeconomic information used in the calculation of the expected losses in its
loan portfolio.
Given the level of subjectivity and judgment, auditing the estimated allowance for loan losses involved
especially complex and subjective judgment.
How the scope of our audit responded to the key audit matter
Our audit procedures related to the assumptions and unobservable inputs used by management for the
estimate of impaired loans included the following:
• We tested the design and operating effectiveness of controls over the appropriateness of the cash-flows
estimated to be collected in individually significant loans, including the estimates of collateral values.
• We tested the design and operating effectiveness of the controls over the appropriateness of the models
used to determine the calculation of the allowance for loan losses for collectively assessed loans and
most importantly the determination of the relevant model and assumptions to incorporate forward
looking and macro-economic information.
• We used our credit specialists to assist us in challenging the reasonableness of the methodologies and
inputs used in the calculation of the allowance for loan losses for collectively assessed loans, most
importantly in determining the appropriateness of forward looking and macro-economic scenarios
used by management.
• We reperformed the client's estimates of future operating cash flows from borrowers with significant
loans outstanding to determine the available cash flows to repay the loans. In addition, we challenged
these estimates by searching for contradictory evidence available at the balance sheet date.
• We selected samples of loans subject to individual assessments and performed the following:
Verified the appropriateness of the process of calculating future cash flows from borrowers
with significant loans outstanding to determine the available cash flows to repay the loans.
With assistance of our appraisal specialists and using property auctions price information
sources independently from the Group, we evaluated the reasonableness of cash flow
estimates based on the future sale of collateral.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 170
Responsibilities of Management and the Those Charged with Governance for the Consolidated
Financial Statements
Management is responsible for the preparation of the accompanying consolidated financial statements in
accordance with K-IFRS, and for such internal control as they determine is necessary to enable the
preparation of consolidated financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the consolidated financial statements, management of the Group is responsible for assessing the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the Group or
to cease operations, or has no realistic alternative but to do so.
Those Charged with Governance is responsible for overseeing the Group’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated
financial statements.
As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by management.
• Conclude on the appropriateness of the management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to
the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Group to cease to continue as a
going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements,
including the disclosures, and whether the consolidated financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial statements. We
are responsible for the direction, supervision and performance of the group audit. We are solely
responsible for our audit opinion.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 171
We communicate with the those Charged with Governance of the Group regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide the those Charged with Governance of the Group with a statement that we have complied
with relevant ethical requirements, including those related to independence, and to communicate with them
all matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with those Charged with Governance, we determine those matters that were
of most significance in the audit of the consolidated financial statements of the current period and are
therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation
precludes public disclosure about the matter.
As described in the Note 43, Woori Financial Group Inc. was established on January 11, 2019 as a
comprehensive transfer with shareholders of Woori Bank, Woori Finance Research Institute Co., Ltd., Woori
FIS Co., Ltd., Woori Fund Service Co., Ltd., Woori Credit Information Co., Ltd., and Woori Private Equity
Asset Management Co., Ltd. Under the deal, Woori Bank and its subsidiaries were incorporated into wholly-
owned subsidiaries of Woori Financial Group Inc., while Woori Financial Group Inc. was listed on the Korea
Exchange on February 13, 2019, replacing Woori Bank's shares in the company. American Depository Shares
(ADS) has also been traded on the New York Stock Exchange as the underlying common stock since the
same date. Therefore, consolidated financial statements for the comparing period ended 31 December 2018
are consolidated financial statements of Woori Bank, which have been adjusted as before the classification
of assets held for sale for the Woori Finance Research Institute Co., Ltd., Woori FIS Co., Ltd., Woori Fund
Service Co., Ltd., Woori Credit Information Co., Ltd., and Woori Private Equity Asset Management Co., Ltd.
except Woori Bank.
In accordance with the Korean Standard on Auditing, We audited the consolidated statement of financial
position as of December 31, 2018, consolidated statement of comprehensive income, consolidated statement
changes in equity and consolidated statement of cash flows for the fiscal year ending the same date. The audit
report of Woori Bank as of December 31, 2018 was issued with an unqualified opinion on March 19, 2019.
The engagement partner on the audit resulting in this independent auditor’s report is Tae Jin Jo
March 16, 2020
Notice to Readers
This report is effective as of March 16, 2020 the auditors’ report date. Certain subsequent events or
circumstances may have occurred between the auditors’ report date and the time the auditors’ report is read.
Such events or circumstances could significantly affect the consolidated financial statements and may result
in modifications to the auditors’ report.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 172
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
AS OF DECEMBER 31, 2019 AND 2018
AS OF DECEMBER 31, 2019 AND 2018
Cash and cash equivalents (Note 6)
Financial assets at fair value through profit or loss (“FVTPL”)
(Notes 4, 7, 11, 12, 18 and 26)
ASSETS
Financial assets at fair value through other comprehensive income(“FVTOCI”)
(Notes 4, 8, 11, 12, and 18)
Securities at amortized cost (Notes 4, 9, 11, 12 and 18)
Loans and other financial assets at amortized cost (Notes 4, 10, 11, 12, 18 and 41)
Investments in joint ventures and associates (Note 13)
Investment properties (Note 14)
Premises and equipment (Notes 15 and 18)
Intangible assets and goodwill (Note 16)
Assets held for distribution (sale) (Note 17)
Net defined benefit asset (Note 24)
Current tax assets (Note 38)
Deferred tax assets (Note 38)
Derivative assets (Designated for hedging) (Notes 4,11,12 and 26)
Other assets (Notes 19 and 41)
Total assets
LIABILITIES
Financial liabilities at FVTPL (Notes 4, 11, 12, 20 and 26)
Deposits due to customers (Notes 4,11,21 and 41)
Borrowings (Notes 4, 11, 12 and 22)
Debentures (Notes 4, 11 and 22)
Provisions (Notes 23, 40 and 41)
Net defined benefit liability (Note 24)
Current tax liabilities (Note 38)
Deferred tax liabilities (Note 38)
Derivative liabilities (Designated for hedging) (Notes 4,11,12 and 26)
Other financial liabilities (Notes 4,11,12, 25 and 41)
Other liabilities (Notes 25 and 41)
Total liabilities
(Continued)
December 31,
2019
(Korean Won in millions)
December 31,
2018(Note 43)
6,392,566
6,747,894
8,069,144
6,126,316
27,730,531
20,320,539
293,717,693
806,360
280,239
3,364,716
844,110
10,556
2,582
47,367
39,544
121,131
233,646
361,980,724
2,958,302
264,685,578
18,998,920
30,858,055
443,980
92,470
182,690
134,322
6,837
17,706,767
420,471
336,488,392
18,063,423
22,932,559
282,457,578
361,766
378,196
2,450,492
597,520
17,912
-
20,730
59,641
35,503
197,653
340,447,183
2,282,686
248,690,939
16,202,986
28,735,862
391,313
173,109
159,078
18,156
51,408
21,442,524
346,078
318,494,139
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
173
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
WOORI FINANCIAL GROUP INC.AND SUBSIDIARIES
AS OF DECEMBER 31, 2019 AND 2018 (CONTINUED)
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
AS OF DECEMBER 31, 2019 AND 2018 (CONTINUED)
December 31,
December 31,
2018(Note 43)
2019
(Korean Won in millions)
EQUITY
Owners’ equity (Note 28)
Capital stock
Hybrid securities
Capital surplus
Other equity
Retained earnings
Regulatory reserve for credit loss as of December 31, 2019 and 2018 is
2,356,246 million Won and 2,578,457 million Won, respectively
Regulatory reserve for credit loss to be reserved as of December 31, 2019 and
2018 is 191,301 million Won and (-) 222,211 million Won, respectively
Planned provision of regulatory reserve for credit loss as of December 31,
2019 and 2018 is 191,301 million Won and (-) 222,211 million Won,
respectively
Non-controlling interests
Total equity
Total liabilities and equity
See accompanying notes
21,510,370
3,611,338
997,544
626,295
(2,249,322)
21,739,931
3,381,392
3,161,963
285,889
(2,213,970)
18,524,515
3,981,962
25,492,332
361,980,724
17,124,657
213,113
21,953,044
340,447,183
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
174
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
WOORI FINANCIAL GROUP INC.AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
Interest income
Financial assets at FVTPL
Financial assets at FVTOCI
Financial assets at amortized cost
Interest expense
Net interest income (Notes 11, 30 and 41)
Fees and commissions income
Fees and commissions expense
Net fees and commissions income (Notes 11, 31 and 41)
Dividend income (Note 32)
Net gain on financial instruments at FVTPL
(Notes 11 and 33)
Net gain on financial assets at FVTOCI (Notes 11 and 34)
Net gain arising on financial assets at amortized cost
Net gain on disposals of securities at amortized cost
Net gain on disposals of loans and other financial assets at
amortized cost
Impairment losses due to credit loss (Notes 11, 35 and 41)
General and administrative expenses (Notes 36 and 41)
Other net operating expenses (Notes 36 and 41)
Operating income
Share of gain of joint ventures and associates
Other non-operating income (expense)
Non-operating income (expense) (Note 13 and 37)
2019
2018(Note 43)
(Korean Won in millions,
except for per share data)
10,576,770
50,619
474,751
10,051,400
(4,683,064)
5,893,706
1,709,326
(606,698)
1,102,628
107,959
25,455
11,015
102,115
-
102,115
(374,244)
(3,766,077)
(302,581)
2,799,976
83,997
(160,924)
(76,927)
9,684,499
54,243
280,371
9,349,885
(4,033,548)
5,650,951
1,680,764
(610,790)
1,069,974
90,552
214,443
2,047
79,532
431
79,101
(329,574)
(3,624,033)
(394,591)
2,759,301
3,019
42,552
45,571
Net income before income tax expense
2,723,049
2,804,872
Income tax expense (Note 38)
(685,453)
(753,223)
(Continued)
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
175
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR YEARS ENDED DECEMBER 31, 2019 AND 2018 (CONTINUED)
FOR YEARS ENDED DECEMBER 31, 2019 AND 2018 (CONTINUED)
Net income
(Net income after the provision of regulatory reserve for
credit loss for the years ended December 31, 2019 and 2018,
is 1,846,295 million Won and 2,010,774 million Won,
respectively) (Note 28)
Items that will not be reclassified to profit or loss:
Net loss on valuation of equity securities at FVTOCI
Net gain on valuation of financial liabilities designated at
FVTPL due to own credit risk
Remeasurement gain (loss) related to defined benefit plan
Items that may be reclassified to profit or loss:
Net gain on valuation of debt securities at FVTOCI
Share of other comprehensive gain of joint ventures and
associates
Net gain(loss) on foreign currency translation of foreign
operations
Net loss on valuation of cash flow hedge
Other comprehensive income on valuation of assets held for
sale
Other comprehensive income(loss), net of tax
2019
2018(Note 43)
(Korean Won in millions,
except for per share data)
2,037,596
2,051,649
(58,129)
-
(34,648)
(92,777)
43,988
613
101,781
(1,823)
-
144,559
51,782
(30,855)
100
(84,629)
(115,384)
33,360
2,958
(4,379)
(4,646)
(4,145)
23,148
(92,236)
Total comprehensive income
2,089,378
1,959,413
Net income attributable to:
Net income attributable to shareholders
Net income attributable to non-controlling interests
Total comprehensive income attributable to:
Comprehensive income attributable to shareholders
Comprehensive income attributable to
non-controlling interests
Earnings per share (Note 39)
1,872,207
165,389
2,033,182
18,467
1,914,393
1,943,885
174,985
15,528
Basic and diluted earnings per share (In Korean Won)
2,727
2,796
See accompanying notes
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
176
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR YEARS ENDED DECEMBER 31, 2019 AND 2018
WOORI FINANCIAL GROUP INC.AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR YEARS ENDED DECEMBER 31, 2019 AND 2018
January 1, 2018
Cumulative effect of change in accounting
policy
Adjusted balance, beginning of period
Net income
Dividends to common stocks
Change in capital of subsidiaries
Net gain on valuation of financial liabilities
designated as at FVTPL due to own credit risk
Changes in other comprehensive income due to
redemption of financial liabilities designated as
at FVTPL
Net gain (loss) on valuation of financial assets
at FVTOCI
Changes in other comprehensive income due
to disposal of equity securities at FVTOCI
Changes in capital due to equity method
Loss on foreign currency translation of
foreign operations
Loss on valuation of cash flow hedge
Remeasurement loss related to defined benefit
plan
Capital related to assets held for distribution
(sale) (Note 43)
Dividends to hybrid securities
Issuance of hybrid securities
Redemption of hybrid securities
Appropriation of retained earnings
December 31, 2018
January 1, 2019
Exchange of non-controlling interests in
hybrid securities
Net income
Dividends to common shares
Changes in subsidiaries’ capital
Net loss on valuation of financial assets at
FVTOCI
Changes in other comprehensive income due
to disposal of equity securities at FVTOCI
Changes in capital due to equity method
Gain on foreign currency translation of
foreign operations
Loss on valuation of cash flow hedge
Remeasurement loss related to defined benefit
plan
Comprehensive stock exchange(Note 1)
Acquisition of subsidiaries
New stocks issue cost
Net increase of treasury stocks
Dividends to hybrid securities
Issuance of hybrid securities
Redemption of hybrid securities
Appropriation of retained earnings
Other changes in consolidated capital
December 31, 2019
Capital
Stock
Hybrid
securities
(Korean Won in millions)
3,017,888
3,381,392
Capital
surplus
Other
equity
Retained
earnings
Shareholder
’s equity in
total
Non-
controlling
interests
Total
equity
285,880
(1,939,274)
15,620,006 20,365,892
199,008
20,564,900
-
3,381,392
-
-
-
-
3,017,888
-
-
-
-
285,880
-
-
9
(392,176)
(2,331,450)
-
-
-
177,091
(215,085)
15,797,097 20,150,807
2,033,182
(336,636)
9
2,033,182
(336,636)
-
723
199,731
18,467
(2,128)
(18)
(214,362)
20,350,538
2,051,649
(338,764)
(9)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,381,392
-
-
398,707
(254,632)
-
3,161,963
-
-
-
-
-
285,889
100
(4)
2,733
(1,009)
2,958
(1,929)
(4,646)
(84,368)
(4,145)
-
-
(368)
208,158
(2,213,970)
-
4
-
1,009
(10,647)
-
-
-
100
-
-
-
100
-
2,733
(228)
2,505
-
(7,689)
(1,929)
(4,646)
-
-
(2,450)
-
-
(7,689)
(4,379)
(4,646)
(84,368)
(261)
(84,629)
-
(151,194)
-
-
(208,158)
(4,145)
(151,194)
398,707
(255,000)
-
17,124,657 21,739,931
-
-
-
-
-
213,113
(4,145)
(151,194)
398,707
(255,000)
-
21,953,044
3,381,392
3,161,963
285,889
(2,213,970)
17,124,657 21,739,931
213,113
21,953,044
-
-
-
-
-
-
-
-
-
-
229,946
-
-
-
-
-
-
-
-
3,611,338
(3,161,963)
-
-
-
-
-
-
438
-
-
-
-
-
1,872,207
(437,626)
-
(3,161,963)
1,872,207
(437,626)
438
3,161,963
165,389
(2,014)
(50)
-
2,037,596
(439,640)
388
-
-
-
-
-
-
-
-
-
-
-
997,544
-
-
-
997,544
-
(14,101)
-
(14,101)
(40)
(14,141)
-
1,153
-
-
29,368
613
91,748
(1,823)
(29,368)
-
-
-
-
1,766
91,748
(1,823)
-
351,663
-
(12,848)
-
-
-
-
-
-
626,295
(34,251)
-
-
-
4,245
-
-
(277)
368
(111,242)
(2,249,322)
-
-
-
-
-
(4,362)
-
-
(368)
(625)
18,524,515
(34,251)
581,609
-
(12,848)
4,245
(4,362)
997,544
(277)
-
(111,867)
21,510,370
-
-
-
1,766
10,033
-
101,781
(1,823)
(397)
-
69,534
-
-
(134,421)
658,470
(159,618)
-
-
3,981,962
(34,648)
581,609
69,534
(12,848)
4,245
(138,783)
1,656,014
(159,895)
-
(111,867)
25,492,332
See accompanying notes
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 177
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
Cash flows from operating activities:
Net income
Adjustments to net income:
Income tax expense
Interest income
Interest expense
Dividend income
Additions of expenses not involving cash outflows:
Impairment loss due to credit loss
Loss on financial assets at FVTOCI
Loss on derivatives (designated for hedge)
Loss on fair value hedge
Loss on other provisions
Loss on valuation of investments in joint ventures and associates
Loss on disposal of investments in joint ventures and associates
Retirement benefit
Depreciation and amortization
Loss on disposal of premises and equipment, intangible assets and other assets
Impairment loss on premises and equipment, intangible assets and other assets
Deductions of income not involving cash inflows:
Gain on valuation of financial assets at FVTPL
Gain on redemption of debentures
Gain on securities at FVTOCI
Gain on securities at amortized cost
Gain on derivatives (designated for hedge)
Gain on fair value hedge
Gain on other provisions
Gain on valuation of investments in joint ventures and associates
Gain on disposal of investments in joint ventures and associates
Gain on disposal of premises and equipment, intangible assets and other assets
Reversal of impairment loss on premises and equipment, intangible assets and other
assets
Changes in operating assets and liabilities:
Financial instruments at FVTPL
Loans and other financial assets at amortized cost
Other assets
Deposits due to customers
Provisions
Net defined benefit liability
Other financial liabilities
Other liabilities
Cash received from operating activities:
Interest income received
Interest expense paid
Dividends received
Income tax paid
Net cash provided by operating activities
(Continued)
2019
2018(Note 43)
(Korean Won in millions)
2,037,596
2,051,649
685,453
(10,576,770)
4,683,064
(107,959)
(5,316,212)
753,223
(9,684,499)
4,033,548
(90,552)
(4,988,280)
374,244
1,375
3,686
86,214
129,682
19,778
-
165,125
505,718
3,433
28,295
1,317,550
246,175
-
12,390
-
126,651
231
3,302
103,775
-
1,632
103
494,259
(506,772)
(11,265,714)
86,237
15,407,222
(63,751)
(293,008)
(4,719,399)
30,693
(1,324,492)
10,478,357
(4,383,916)
107,940
(552,215)
5,650,166
1,870,349
329,574
1,053
36,483
17,299
28,350
22,772
2,931
142,712
272,550
1,160
87
854,971
215,711
1,597
3,100
431
35,810
42,797
2,014
25,791
50,511
30,278
761
408,801
670,872
(15,718,714)
32,328
13,995,747
(11,920)
(135,313)
7,411,617
96,900
6,341,517
9,617,201
(3,847,275)
90,651
(551,560)
5,309,017
9,160,073
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
178
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (CONTINUED)
Cash flows from investing activities:
Cash in-flows from investing activities:
Disposal of financial assets at FVTPL
Disposal of financial assets at FVTOCI
Redemption of securities at amortized cost
Disposal of investments in joint ventures and associates
Disposal of investment properties
Disposal of premises and equipment
Disposal of intangible assets
Disposal of assets held for distribution (sale)
Cash out-flows from investing activities:
Net cash out-flows of business combination
Acquisition of financial assets at FVTPL
Acquisition of financial assets at FVTOCI
Acquisition of securities at amortized cost
Acquisition of investments in joint ventures and associates
Acquisition of investment properties
Acquisition of premises and equipment
Acquisition of intangible assets
Net cash used in investing activities
Cash flows from financing activities:
Cash in-flows from financing activities:
Increase in borrowings
Issuance of debentures
Issuance of hybrid securities
Retirement of treasury stocks
Cash out-flows from financing activities:
Cash out-flows from hedging activities
Decrease in borrowings
Redemption of debentures
Redemption of lease liabilities
New stock issue cost
Acquisition of treasury stocks
Dividends paid
Redemption of hybrid securities
Dividends paid to hybrid securities
Dividends paid to non-controlling interest
Capital reduction with consideration for non-controlling interest
Net cash provided by financing activities
2019
2018(Note 43)
(Korean Won in millions)
11,357,056
14,303,197
8,709,947
30,098
193
7,735
939
5,608
34,414,773
296,813
11,823,630
23,775,062
6,092,078
389,096
70,346
429,547
126,342
43,002,914
(8,588,141)
14,467,287
25,510,713
1,656,014
760,101
42,394,115
5,520
11,385,530
23,651,950
217,867
17,337
184,164
437,626
160,000
161,052
2,014
50
36,223,110
6,171,005
11,919,335
9,146,307
9,426,757
51,435
3,512
5,545
9,199
80,347
30,642,437
134,967
12,322,160
13,275,429
15,622,847
48,272
15,195
118,668
176,067
41,713,605
(11,071,168)
9,606,126
21,505,849
398,707
-
31,510,682
-
8,349,005
20,903,518
-
-
-
336,636
255,000
147,625
2,128
-
29,993,912
1,516,770
Net decrease in cash and cash equivalents
(546,787)
(394,325)
Cash and cash equivalents, beginning of the period
6,747,894
6,908,286
Effects of exchange rate changes on cash and cash equivalents
191,459
233,933
Cash and cash equivalents, end of the period (Note 6)
6,392,566
6,747,894
See accompanying notes
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
179
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
1. GENERAL
(1) Summary of the parent company
Woori Financial Group, Inc. (hereinafter referred to the “Group” ) is primarily aimed at controlling subsidiaries
that operate in the financial industry or those that are closely related to the financial industry through the
ownership of shares and was established on January 11, 2019 under the Financial Holding Company Act through
the comprehensive transfer with shareholders of Woori Bank, Woori FIS Co., Ltd., Woori Finance Research
Institute Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Services Co., Ltd. and Woori Private Equity
Asset Management Co. Ltd. The headquarters of the company is located at 51, Sogong-ro, Jung-gu, Seoul,
Korea, and the capital is 3,611,338 million Won as of the end of the current term while the Korea Deposit
Insurance Corp. (KDIC), the company’s largest shareholder, owns 124,604,797 shares (17.25%) of the
company’s stocks issued. The company’s stocks were listed on the Korea Exchange on February 13, 2019, and
its American Depository Shares (ADS) are also being traded as the underlying common stock on the New York
Stock Exchange since the same date.
The details of stock transfer from the company and subsidiaries as of incorporation are as follows (Unit: Number
of shares)
Stock transfer company
Woori Bank
Woori FIS Co., Ltd.
Woori Finance Research Institute Co., Ltd.
Woori Credit Information Co., Ltd.
Woori Fund Service Co., Ltd.
Woori Private Equity Asset Management Co.,
Ltd.
Total number of
issued shares
Exchange ratio
per share
Number of Parent
company’s stocks
676,000,000
4,900,000
600,000
1,008,000
2,000,000
6,000,000
1.0000000
0.2999708
0.1888165
1.1037292
0.4709031
0.0877992
676,000,000
1,469,857
113,289
1,112,559
941,806
526,795
As of August 1, 2019, the parent company acquired a 73% interest in Tongyang Asset Management Co. and
changed the name to Woori Asset Management Corp. Also, as of August 1, 2019, the parent company gained
100% control of ABL Asset Management Co., Ltd., added it as a consolidated subsidiary and changed the name
to Woori Global Asset Management Co., Ltd. on December 6, 2019.
The parent company paid 598,391 million Won in cash and 42,103,377 new shares of the parent company to
acquire 100% interest of Woori Card Co., Ltd. from its subsidiary Woori Bank on September 10, 2019. On the
same date, the company also acquired 59.83% interest of Woori Investment Bank Co., Ltd. from Woori Bank
with 392,795 million Won in cash.
As of December 30, 2019, the parent acquired a 67.2% interest (excluding treasury stocks, 51% interest
including treasury stocks) in Woori Asset Trust Co., Ltd (formerly Kukje Asset Trust Co., Ltd) and added it as a
consolidated subsidiary at the end of 2019.
(2) The companies and subsidiaries (hereinafter ‘consolidated company’) as of December 31, 2019 and 2018
are as follows:
Subsidiaries
Woori Financial Group Inc.
Woori Bank
Woori Card Co., Ltd.
Woori Investment Bank Co., Ltd.
Woori FIS Co., Ltd.
Main business
Percentage of ownership
(%)
December
31, 2019
December
31, 2018
Financial
statements date
of use
Location
Bank
Finance
Other credit finance business
System software development
& maintenance
100.0
100.0
59.8
100.0
-
-
-
-
Korea
Korea
Korea
December 31
December 31
December 31
Korea
December 31
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 180
- 2 -
Subsidiaries
Main business
Percentage of ownership
(%)
December
31, 2019
December
31, 2018
Woori Finance Research Institute Co.,
Ltd.
Woori Credit Information Co., Ltd.
Woori Fund Service Co., Ltd.
Woori Asset Trust Co., Ltd. (*1)
Woori Asset Management Corp.
Woori Private Equity Asset Management
Co., Ltd.
Woori Global Asset Management Co.,
Ltd.
Woori Bank
Woori Card Co., Ltd.
Woori Investment Bank Co., Ltd.
Woori FIS Co., Ltd.
Woori Finance Research Institute Co.,
Ltd.
Woori Credit Information Co., Ltd.
Woori Fund Service Co., Ltd.
Woori Private Equity Asset Management
Co., Ltd.
Woori America Bank
Woori Global Markets Asia Limited
Woori Bank China Limited
AO Woori Bank
PT Bank Woori Saudara Indonesia 1906
Tbk
Banco Woori Bank do Brasil S.A.
Korea BTL Infrastructure Fund
Woori Finance Cambodia PLC.
Woori Finance Myanmar Co., Ltd.
Wealth Development Bank
Woori Bank Vietnam Limited
WB Finance Co., Ltd.
Woori Bank Europe
Kumho Trust First Co., Ltd. (*2)
Asiana Saigon Inc. (*2)
KAMCO Value Recreation First
Securitization Specialty Co., Ltd. (*2)
Hermes STX Co., Ltd. (*2)
BWL First Co., LLC (*2)
Deogi Dream Fourth Co., Ltd. (*2)
Jeonju Iwon Ltd. (*2)
Wonju I one Inc. (*2)
Heitz Third Co., Ltd. (*2)
Woorihansoop 1st Co., Ltd. (*2)
Electric Cable First Co., Ltd. (*2)
Woori International First Co., Ltd. (*2)
Woori WEBST 1st Co., Ltd. (*2)
Wibihansoop 1st Co., Ltd. (*2)
Uri QS 1st Co., Ltd. (*2)
Uri Display 1st Co., Ltd. (*2)
Tiger Eyes 2nd Co., Ltd. (*2)
Woori Serveone 1st Co., Ltd. (*2)
Uri Display 2nd Co., Ltd. (*2)
Woori the Colony Unjung Securitization
Specialty Co., Ltd. (*2)
Woori Dream 1st Co., Ltd. (*2)
Woori Dream 2nd Co., Ltd. (*2)
Woori H 1st Co., Ltd. (*2)
Woori HS 1st Co., Ltd.
Woori HS 2nd Co., Ltd. (*2)
Woori Sinnonhyeon 1st Inc. (*2)
Woori K 1st Co., Ltd. (*2)
Uri S 1st Co., Ltd. (*2)
Smart Casting Inc. (*2)
Uri Display 3rd Co., Ltd. (*2)
Other service business
Credit information
Finance
Real-estate
Finance
Finance
Finance
Finance
Other credit finance business
System software development
& maintenance
Other service business
Credit information
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Finance
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
100.0
100.0
100.0
67.2
73.0
100.0
100.0
-
-
-
-
-
-
-
100.0
100.0
100.0
100.0
79.9
100.0
99.9
100.0
100.0
51.0
100.0
100.0
100.0
0.0
0.0
15.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-
0.0
0.0
0.0
0.0
0.0
0.0
Financial
statements date
of use
December 31
December 31
December 31
December 31
December 31
Location
Korea
Korea
Korea
Korea
Korea
Korea
December 31
Korea
December 31
-
-
-
-
-
-
-
100.0
59.8
Korea
Korea
December 31
December 31
100.0
Korea
December 31
100.0
100.0
100.0
Korea
Korea
Korea
December 31
December 31
December 31
Korea
America
December 31
100.0
December 31
100.0
100.0 Hong Kong December 31
December 31
100.0
December 31
100.0
China
Russia
Brazil
Korea
79.9
100.0
99.9
Indonesia December 31
December 31
December 31
100.0 Cambodia December 31
100.0 Myanmar December 31
51.0 Philippines December 31
Vietnam December 31
100.0
100.0 Cambodia December 31
Germany December 31
100.0
December 31
0.0
December 31
0.0
Korea
Korea
15.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 3 -
Main business
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Securities investment and
others
Securities investment and
others
Securities investment and
others
Securities investment and
others
Securities investment and
others
Securities investment and
others
Securities investment and
others
Securities investment and
others
Trust
Trust
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
Asset securitization
181
Percentage of ownership
(%)
December
31, 2019
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
December
31, 2018
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Financial
statements date
of use
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
December 31
Location
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Marshall
islands
Korea
Korea
Korea
Korea
Korea
Korea
100.0
100.0
Korea
December 31
98.5
97.3
98.5
Korea
December 31
97.3
England
December 31
75.0
99.0
99.4
99.9
99.3
0.0
0.0
54.6
0.0
5.0
5.0
5.0
5.0
5.0
5.0
5.0
0.0
0.0
75.0
Korea
December 31
-
-
-
-
0.0
0.0
-
-
5.0
5.0
5.0
5.0
5.0
5.0
-
-
-
Korea
December 31
Korea
December 31
Korea
December 31
Korea
Korea
December 31
December 31
Korea
December 31
Luxembourg December 31
Belgium
December 31
Korea
December 31
Korea
December 31
Korea
December 31
Korea
December 31
Korea
December 31
Korea
December 31
Korea
Korea
Korea
December 31
December 31
December 31
Finance
100.0
100.0 Myanmar December 31
Asset securitization
Asset securitization
0.5
0.5
0.5
0.5
Korea
December 31
Korea
December 31
Subsidiaries
TY 1st Co., Ltd. (*2)
Woori HJ 2nd Co., Ltd. (*2)
Woori-HJ 3rd Co., Ltd. (*2)
Uri K 2nd Co., Ltd. (*2)
Woori KC No.1 Co., Ltd. (*2)
Woori Lake 1st., Ltd. (*2)
Woori QSell 2nd Co., Ltd. (*2)
Quantum Jump the 1st Co., Ltd. (*2)
Quantum Jump the 2nd Co., Ltd. (*2)
Woori BK the 1st Co., Ltd. (*2)
Woori-HC 1st Co., Ltd. (*2)
Wivi Synergy 1st Co., Ltd. (*2)
ATLANTIC TRANSPORTATION 1
S.A. (*2)
Woori Gongdeok First Co., Ltd. (*2)
HD Project Co., Ltd. (*2)
Woori HW 1st Co., Ltd. (*2)
Woori HC 2nd Co., Ltd. (*2)
Woori Dream 3rd Co., Ltd. (*2)
Woori SJS 1st Co., Ltd. (*2)
G5 Pro Short-term Bond Investment Fund
13 (*3)
Heungkuk Global Private Placement
Investment Trust No. 1 (*3)
AI Partners UK Water Supply Private
Placement Investment Trust No.2 (*3)
Consus Sakhalin Real Estate Investment
Trust 1st (*3)
Multi Asset Global Real Estate
Investment Trust No. 5-2 (*3)
Igis Australia Investment Trust No. 209-1
(*3)
Woori Global Development Infrastructure
Synergy Company Private Placement
Investment Trust No.1 (*3)
IGIS Global Private Placement Real
Estate Fund No. 316-1 (*3)
Principal Guaranteed Trust (*4)
Principal and Interest Guaranteed Trust
(*4)
Multi Asset Global Real Estate Investment
Trust No. 5-2:
MAGI No.5 LuxCo S.a.r.l. (*2)
MAGI No.5 LuxCo S.a.r.l.:
ADP 16 Brussels (*2)
Woori Investment Bank Co., Ltd.:
Dongwoo First Securitization Specialty
Co., Ltd. (*2)
Seari First Securitization Specialty Co.,
Ltd. (*2)
Seari Second Securitization Specialty
Co., Ltd. (*2)
Namjong 1st Securitization Specialty Co.,
Ltd. (*2)
Bukgeum First Securitization Specialty
Co., Ltd. (*2)
Bukgeum Second Securitization Specialty
Co., Ltd. (*2)
WS1909 Securitization Specialty Co.,
Ltd. (*2)
One Punch Korea the 1st Co., Ltd. (*2).
One Punch blue the 1st Co., Ltd. (*2)
Woori Card Co., Ltd.:
TUTU Finance –WCI Myanmar Co., Ltd.
Woori Card one of 2017-1 Securitization
Specialty Co., Ltd. (*2)
Woori Card one of 2017-2 Securitization
Specialty Co., Ltd. (*2)
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 182
- 4 -
Subsidiaries
Woori Card one of 2018-1 Securitization
Specialty Co., Ltd. (*2)
WOORI CARD 2019-1 ASSET
SECURITIZATION SPECIALTY CO.,
LTD. (*2)
Woori Private Equity Asset Management
Co., Ltd. and Woori Investment Bank Co.,
Ltd.:
Japanese Hotel Real Estate Private Equity
Fund 1 (*3)
Woori Asset Management Corp.:
Woori china convertible bond fund (*3)
Woori Global Asset Management Co.,Ltd.:
WOORIG China Value Equity (C/C(F))
(*3)
Woori Bank, Woori Investment Bank Co.,
Ltd and Woori Private Equity Asset
Management Co., Ltd.:
Woori Innovative Growth Professional
Investment Type Private Investment
Trust No.1(*3)
Woori bank and Woori Investment Bank
Co., Ltd.:
Heungkuk Woori Tech Company Private
Placement Investment Trust No. 1 (*3)
Main business
Asset securitization
Asset securitization
Securities investment and
others
Securities investment and
others
Securities investment and
others
Securities investment and
others
Securities investment and
others
Percentage of ownership
(%)
December
31, 2019
December
31, 2018
Financial
statements date
of use
Location
0.5
0.5
45.5
98.6
95.1
60.0
0.5
Korea
December 31
-
-
-
-
-
Korea
December 31
Korea
December 31
Korea
December 31
Korea
December 31
Korea
December 31
100.0
98.0
Korea
December 31
(*1) As of December 31, 2018, Woori bank held 8.6% interest and hold 67.2% interest as of December 31, 2019 as
acquiring 58.6% interests additionally during current period.
(*2) The entity is a structured entity for the purpose of asset securitization. Although the Group is not a majority
shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its
involvement with the investee, and 3) has the ability to use its power to affect its returns.
(*3) The entity is a structured entity for the purpose of investment in securities. Although the Group is not a majority
shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its
involvement with the investee, and 3) has the ability to use its power to affect its returns.
(*4) The entity is a ‘money trust’ under the Financial Investment Services and Capital Markets Act. Although the
Group is not a majority shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to
variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns.
(3) The Group has not consolidated the following entities as of December 31, 2019 and 2018 despite having
more than 50% ownership interest:
As of December 31, 2019
Subsidiaries
Location
Korea
Golden Bridge NHN Online Private Equity Investment (*)
Korea
Mirae Asset Maps Clean Water Private Equity Investment Trust 7th (*)
Korea
Kiwoom Yonsei Private Equity Investment Trust (*)
Korea
IGIS Europe Private Placement Real Estate Fund No. 163-2 (*)
Korea
IGIS Global Private Placement Real Estate Fund No. 148-1 (*)
Korea
IGIS Global Private Placement Real Estate Fund No. 148-2 (*)
Korea
Mirae Asset Seoul Ring Expressway Private Special Asset Fund No. 1 (*)
Hangkang Sewage Treatment Plant Fund (*)
Korea
KIM Pocheon-Hwado Highway Infra Private Placement Special Asset Fund (*) Korea
Main Business
Securities Investment
Securities Investment
Securities Investment
Securities Investment
Securities Investment
Securities Investment
Securities Investment
Securities Investment
Securities Investment
Percentage of
ownership (%)
60.0
59.7
88.9
97.9
75.0
75.0
66.7
55.6
55.2
(*) Since the investee is a private equity investment fund, the Group does not have the power over the fund’s activities
even though it holds more than 50% of ownership interest.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 5 -
183
Subsidiaries
Golden Bridge NHN Online Private Equity Investment (*)
Mirae Asset Seobu Underground Expressway Professional Investment (*)
Mirae Asset Maps Clean Water Private Equity Investment Trust 7th (*)
Kiwoom Yonsei Private Equity Investment Trust (*)
Hana Walmart Real Estate Investment Trust 41-1 (*)
IGIS Europe Private Placement Real Estate Fund No. 163-2 (*)
IGIS Global Private Placement Real Estate Fund No. 148-1 (*)
IGIS Global Private Placement Real Estate Fund No. 148-2 (*)
KB Nongso Sewage Treatment Equipment Private Special Asset (*)
Mirae Asset Seoul Ring Expressway Private Special Asset Fund No. 1 (*)
Hangkang Sewage Treatment Plant Fund (*)
Consus KyungJu Green Private Placement Real Estate Fund No. 1 (*)
As of December 31, 2018
Location
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Korea
Main Business
Securities Investment
Securities Investment
Securities investment
Securities investment
Securities investment
Securities investment
Securities investment
Securities investment
Securities investment
Securities investment
Securities investment
Securities investment
Percentage of
ownership (%)
60.0
65.8
59.7
88.9
89.6
97.9
75.0
75.0
50.0
66.2
55.6
52.4
(*) Since the investee is a private equity investment fund, the Group does not have the power over the fund’s activities
even though it holds more than 50% of ownership interest.
(4) The summarized financial information of the major subsidiaries are as follows. The financial information of
each subsidiary was prepared on the basis of consolidated financial statements. (Unit: Korean Won in
millions):
As of and for the year ended December 31, 2019
Woori Bank (*1)
Woori Card Co., Ltd.
Woori Investment Bank Co., Ltd.
Woori FIS Co., Ltd.
Woori Finance Research Institute Co., Ltd.
Woori Credit Information Co., Ltd.
Woori Fund Service Co., Ltd.
Woori Asset Trust Co., Ltd. (*2)
Woori Asset Management Corp. (*2)
Woori Private Equity Asset Management Co., Ltd.
Woori Global Asset Management Co., Ltd. (*2)
Assets
348,181,658
10,087,342
3,398,960
91,079
5,447
37,872
16,852
139,839
113,037
38,243
32,807
Liabilities
325,526,568
8,299,175
3,031,622
55,112
1,999
7,948
2,109
45,410
6,301
2,985
3,230
Net income
(loss)
attributable to
owners
1,505,547
114,196
53,358
3,107
160
1,698
1,735
-
1,720
(2,087)
(1,360)
Comprehensive
income (loss)
attributable to
owners
1,531,793
111,782
52,095
3,119
117
1,389
1,735
-
2,544
(2,124)
(1,360)
Operating
revenue
22,240,947
1,368,234
204,655
244,923
5,452
39,118
11,071
-
9,204
4,152
3,588
(*1) The amount is prepared based on the consolidated financial statements of Woori Bank (reflecting the classification
of profit or loss of the discontinued operation).
(*2) The income or loss information of Woori Asset Management Corp. and Woori Global Asset Management Co.,
Ltd. are prepared based on the income or loss from August 1, 2019, the date on which the power was obtained, to
December 31, 2019. In addition, the Group acquired Woori Asset Trust Co., Ltd on December 30, 2019, thus the
income or loss information of Woori Asset Trust Co., Ltd are not included.
Woori FIS Co., Ltd.
Woori Private Equity Asset Management Co., Ltd.
Woori Finance Research Institute Co., Ltd.
Woori Card Co., Ltd.
Woori Investment Bank Co., Ltd.
Woori Credit Information Co., Ltd.
Woori America Bank
Woori Global Markets Asia Limited
Woori Bank China Limited
AO Woori Bank
PT Bank Woori Saudara Indonesia 1906 Tbk
Banco Woori Bank do Brasil S.A.
As of and for the year ended December 31, 2018
Assets
96,260
38,820
3,891
9,987,057
2,682,660
34,921
2,182,454
517,627
5,470,927
305,521
2,355,975
179,130
Liabilities
63,412
1,439
560
8,305,093
2,367,418
6,386
1,878,117
396,216
4,953,813
256,260
1,853,768
149,146
Operating
revenue
271,651
1,713
4,708
1,371,301
205,446
36,883
90,975
18,748
366,973
19,433
192,719
13,971
Net income
(loss)
attributable to
owners
Comprehensive
income (loss)
attributable to
owners
2,840
(2,794)
7
114,767
25,552
1,657
20,510
5,144
21,879
5,163
40,385
1,262
269
(2,843)
(109)
106,517
25,533
1,411
32,335
9,647
19,194
(3,234)
27,109
(2,326)
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 184
- 6 -
Korea BTL Infrastructure Fund
Woori Fund Service Co., Ltd.
Woori Finance Cambodia PLC.
Woori Finance Myanmar Co., Ltd.
Wealth Development Bank
Woori Bank Vietnam Limited
WB Finance Co., Ltd.
Woori Bank Europe
Money trust under the FISCM Act
Structured entity for the securitization of financial
assets
Structured entity for the investments in securities
Assets
777,437
14,448
93,239
19,340
218,134
954,580
268,794
58,399
1,582,765
1,369,745
63,676
As of and for the year ended December 31, 2018
Liabilities
Operating
revenue
Net income
(loss)
attributable to
owners
Comprehensive
income (loss)
attributable to
owners
299
1,440
71,133
6,886
184,344
720,554
225,655
311
1,552,594
1,786,869
142
29,760
10,052
11,038
4,496
13,668
48,716
24,310
5
54,860
53,578
1,826
26,057
1,597
2,826
640
80
10,710
2,421
(5,959)
259
4,990
(1,299)
26,057
1,597
3,676
(1,256)
(451)
13,618
2,329
(5,974)
259
(5,681)
(3,009)
(*) The financial statements of the major subsidiaries as of December 31, 2018 are prepared based on the Woori Bank
which was the controlling company at the end of the previous term.
(5) The financial support that the Group provides to consolidated structured entities is as follows:
- Structured entity for asset securitization
The structured entity which is established for the purpose of securitization of project financing loans,
corporate bonds, and other financial assets. The Group is involved with the structured entity through
provision of credit facility over asset-backed commercial papers issued by the entity, originating loans
directly to the structured entity, or purchasing 100% of the subordinated debts issued by the structured
entity.
- Structured entity for the investments in securities
The structured entity is established for the purpose of investments in securities. The Group acquires
beneficiary certificates through its contribution of funding to the structured entity by the Group, and it is
exposed to the risk that it may not be able to recover its fund depending on the result of investment
performance of asset managers of the structured entity.
- Money trust under the Financial Investment Services and Capital Markets Act
The Group provides with financial guarantee of principal and interest or solely principal to some of its
trust products. Due to the financial guarantees, the Group may be obliged when the principal and
interest or principal of the trust product sold is short of the guaranteed amount depending on the result
of investment performance of the trust product.
As of December 31, 2019, the Group provides 2,241,640 million Won of credit facilities for the structured
entities mentioned above.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 7 -
185
(6) The Group has entered into various agreements with structured entities such as asset securitization,
structured finance, investment fund, and monetary trust. The characteristics and the nature of risks related
to unconsolidated structured entities over which the Group does not have control in accordance with K-
IFRS 1110 are as follows:
The ownership interests on unconsolidated structured entities that the Group hold are classified into asset
securitization vehicles, structured finance, investment fund and real-estate trust, based on the nature and the
purpose of the structured entities.
Unconsolidated structured entities classified as ‘asset securitization vehicles’ are entities that issue asset-
backed securities, pay the principal and interest or distributes dividends on asset-backed securities through
borrowings or profits from the management, operation and sale of securitized assets. The Group transfers
related risks by the purchase commitments of asset-backed securities or issuance of asset-backed securities
through credit grants, and the structured entities recognize related interest or fee revenue. There are entities
that provide additional funding and conditional debt acquisition commitments before the Group’s financial
support, but the Group is still exposed to losses arising from the purchase of financial assets issued by the
structured entities when it fails to renew the securities.
Unconsolidated structured entities classified as ‘structured financing’ include real estate project financing
investment vehicle, social overhead capital companies, and special purpose vehicles for ship (aircraft)
financing. Each entity is incorporated as a separate company with a limited purpose in order to efficiently
pursue business goals. ‘Structured financing’ is a financing method for large-scale risky business, with
investments made based on feasibility of the specific business or project, instead of credit of business
owner or physical collaterals. The investors receive profits from the operation of the business. The Group
recognizes interest revenue, profit or loss from assessment or transactions of financial instruments, or
dividend income. With regard to uncertainties involving structured financing, there are entities that provide
financial support such as additional fund, guarantees and prioritized credit grants prior to the Group’s
intervention, but the Group is exposed to possible losses due to loss of principal from reduction in
investment value or irrecoverable loans arising from failure to collect scheduled cash flows and cessation of
projects.
Unconsolidated structured entities classified as ‘investment funds’ include investment trusts and private
equity funds. An investment trust orders the investment and operation of funds to the trust manager in
accordance with trust contract with profits distributed to the investors. Private equity funds finances money
required to acquire equity securities to enable direction of management and/or improvement of ownership
structure, with profit distributed to the investors. The Group recognizes pro rata amount of valuation gain or
loss on investment and dividend income as an investor and may be exposed to losses due to reduction in
investment value.
‘Real estate trust’ is to be entrusted the underlying property for the purpose of managing, disposing,
operating or developing from the consignor who owns the property and distributes the proceeds achieved
through the trust to the beneficiary. When the consignee does not fulfill his or her important obligations in
the trust contract or it is, in fact, difficult to run the business, the Group may be exposed to the threat of
compensating the loss.
The total assets of the unconsolidated structured entity held by the Group, the carrying amount of the items
recognized in the financial statements, the maximum loss exposure, and the losses from the unconsolidated
structured entity are as follows. The maximum loss exposure includes the amount of investment recognized
in the financial statements and the amount that is likely to be confirmed in the future when satisfies certain
conditions by contracts such as purchase arrangements, credit offerings.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 186
- 8 -
Total asset of the unconsolidated
structured entities
Assets recognized in the consolidated
financial statements related to the
unconsolidated structured entities
Financial assets at FVTPL
Financial assets at FVTOCI
Financial assets at amortized cost
Investments in joint ventures and
associates
Derivative assets
Liabilities recognized in the
consolidated financial statements
related to the unconsolidated
structured entities
Derivative liabilities
Other liabilities (provisions)
The maximum exposure to risks
Investment assets
Credit facilities
Loss recognized on unconsolidated
structured entities
Total asset of the unconsolidated
structured entities
Assets recognized in the consolidated
financial statements related to the
unconsolidated structured entities
Financial assets at FVTPL
Financial assets at FVTOCI
Financial assets at amortized cost
Investments in joint ventures and
associates
Derivative assets
Liabilities recognized in the
consolidated financial statements
related to the unconsolidated
structured entities
Derivative liabilities
Other liabilities (provisions)
The maximum exposure to risks
Investments
Credit facilities
Loss recognized on unconsolidated
structured entities
Asset securitization
vehicle
Structured Finance
Investment Funds
Real-estate trust
December 31, 2019
8,230,254
62,879,421
18,265,273
152,257
5,128,616
324,414
2,006,230
2,796,695
-
1,277
184
-
184
5,561,394
5,128,616
432,778
2,982,217
28,834
42,305
2,897,620
7,475
5,983
1,291
15
1,276
3,532,539
2,982,217
550,322
1,411,639
1,109,621
-
120,072
181,946
-
-
-
-
1,457,398
1,411,639
45,759
-
4,660
34,312
57,928
655
-
57,273
-
-
2,808
-
2,808
77,117
57,928
19,189
5,218
Asset securitization vehicle
December 31, 2018
Structured finance
Investment funds
6,796,235
58,161,494
11,138,822
2,571,835
285,156
281,919
2,003,921
-
839
1,260
116
1,144
3,252,329
2,571,835
680,494
5,764
2,831,842
70,219
48,961
2,511,055
197,393
4,214
905
248
657
3,408,271
2,831,842
576,429
11,609
1,530,767
1,197,844
-
71,150
261,773
-
-
-
-
1,587,325
1,530,767
56,558
13,868
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
- 9 -
187
(7) As of December 31, 2019 and 2018, the share of non-controlling interests on the net income and equity of
subsidiaries in which non-controlling interests are significant are as follows: (Unit: Korean Won in
millions):
1) Accumulated non-controlling interests at the end of the reporting period
Woori Bank (*)
Woori Investment Bank
Woori Asset Trust Co., Ltd
Woori Asset Management Corp
PT Bank Woori Saudara Indonesia 1906 Tbk
Wealth Development Bank
(*) Hybrid securities issued by Woori Bank
2) Net income attributable to non-controlling interests
December 31, 2019
December 31, 2018
3,660,814
151,170
40,161
29,800
83,315
18,524
-
130,088
-
-
68,250
16,557
Woori Bank (*)
Woori Investment Bank
Woori Asset Trust Co., Ltd
Woori Asset Management Corp
PT Bank Woori Saudara Indonesia 1906 Tbk
Wealth Development Bank
For the year ended
December 31, 2019
For the year ended
December 31, 2018
134,421
21,588
-
408
8,502
427
-
10,262
-
-
8,126
39
(*)Distribution of the hybrid securities issued by Woori Bank
3) Dividends to non-controlling interests
PT Bank Woori Saudara Indonesia 1906 Tbk
1,981
2,082
For the year ended
December 31, 2019
For the year ended
December 31, 2018
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
188
- 10 -
2. BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES
(1) Basis of presentation
The Group’s consolidated financial statements are prepared in accordance with Korean International Financial
Reporting Standards (“K-IFRS”)
The significant accounting policies applied in the preparation of consolidated financial statements as of and for
the year ended December 31, 2019 are stated below, and the accounting policies applied are identical to ones
used in the preparation of Woori Bank’s previous period consolidated financial statements, except for the effects
of adopting new standards or interpretations as explained below.
The consolidated financial statements, as described in following paragraphs of accounting policy, are prepared at
the end of each reporting period in historical cost basis, except for certain non-current assets and financial assets
that are either revalued or measured in fair value. Historical cost is generally measured at the fair value of
consideration given to acquire assets.
The consolidated financial statements of the Group were approved for the issuance on March 3, 2020 by the
Board of Directors, and the final approval will be made in the annual general shareholders’ meeting on March
25, 2020.
1) The standards and interpretations that are newly adopted by the Group during the current period, and the
changes in accounting policies thereof are as follows:
① K-IFRS 1109 ‘Financial Instruments,’ K-IFRS 1107 ‘Financial Instruments: Disclosure’ amendments
The Group has adopted the amendments of K-IFRS 1109 and 1107 for the first time in the current year. The
amendments mainly deal with the addition of temporary exceptions from applying specific hedge
accounting requirements while the uncertainty arises from interest rate benchmark reform. The amendment
requires that for the purpose of determining whether a forecast transaction (or a component thereof) is
highly probable, an entity shall assume that the interest rate benchmark on which the hedged cash flows
(contractually or non-contractually specified) are based is not altered as a result of interest rate benchmark
reform. When applying the prospective assessment, the amendment further requires that an entity shall
assume that the hedged risk or the interest rate benchmark on which the hedged item or the hedging
instrument is based is not altered as a result of the reform. Additionally, for a hedge of a non-contractually
specified benchmark component of interest rate risk, an entity shall apply the requirement that the risk
component shall be separately identifiable only at the inception of the hedging relationship. Meanwhile, an
entity shall prospectively cease applying the temporary exceptions to a hedged item at the earlier of:
(a)when the uncertainty arising from interest rate benchmark reform is no longer present with respect to the
timing and the amount of the interest rate benchmark-based cash flows of the hedged item; and (b)when the
hedging relationship that the hedged item is part of is discontinued. Note 26 sets out details of the hedge
accounting applied by the Group. These amendments will be effective from January 1, 2020 but the Group
has applied such amendments in current year as the early adoption is permitted.
② K-IFRS 1116 Leases
The Group initially applied K-IFRS 1116 on January 1, 2019.
K-IFRS 1116 introduces an accounting model for the single lessee and as a result, the Group, as a lessee,
recognizes right-of-use assets which represent a lessee’s right to use an underlying asset and lease liabilities
which represent an obligation to make lease payments. An accounting model for the lessor is similar to the
previous accounting policy.
The Group recognized the cumulative effects due to the initial application of K-IFRS 1116 on January 1,
2019, which is the date of initial application. Therefore, the comparative financial information applies K-
IFRS 1017 and K-IFRS 2104 as reported previously, and was not restated. The details of the changes to the
accounting policy are described below.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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189
i)
Definition of lease
Previously, the Group determined whether an arrangement is, or contains, a lease on the arrangement date
by applying K-IFRS 2104 ‘Determining whether an arrangement contains a lease’ which focused on ‘risks
and consideration’. The Group has started to determine whether the contract is, or contains, a lease, based
on the new definition of a lease. Under K-IFRS 1116, a contract determines whether a lease includes
control of the use of an underlying asset that is identified in exchange for consideration.
On the date of initial application for K-IFRS 1116, the Group elected to apply a practical expedient which
does not require the Group to reassess whether the contract is a lease. The Group applied K-IFRS 1116
only to the contracts that were previously identified as a lease and did not reassess the contracts that were
not identified as a lease in line with K-IFRS 1017 and K-IFRS 2104. Therefore, the definition of lease
under K-IFRS 1116 is only applicable to contracts that are entered into or modified after January 1, 2019.
For the agreed or revalued date of the contract that contains a lease component, the Group allocates the
consideration in the contract to each lease component on the basis of the relative stand-alone price of the
lease and non-lease components.
The Group elected not to recognize right-to-use assets and lease liabilities for certain leases of low-value
assets (e.g. IT facilities) and short-term leases (less than one year). The Group will recognize the related
lease payments as expenses equally over the lease period.
IFRS Interpretations Committee published its interpretation of ‘Lease Period and Lease Improvement
Useful Life’ as of December 16, 2019. The Interpretation Committee discussed a question about how to
determine the lease term for cancellable or renewable leases and according to the interpretation, the lease
term will depend on both the termination penalties in the contract and the broader economics of the
contract. Agenda decisions issued by the Interpretations Committee do not have an application date, but are
expected to be implemented as soon as possible. The Group is currently assessing the impact of the agenda
decision and does not expect a material impact to the financial statements.
ii)
Lessee
The Group leases various assets, including buildings, vehicles and IT equipment.
Previously, the Group classified its leases either as operating leases or as finance leases based on whether
the lease substantially transfers the risk and reward of owning the underlying assets. According to K-IFRS
1116, the Group recognizes right-of-use assets and lease liabilities for most of its leases, which means most
of its leases are presented in the statement of financial position.
For the right-of-use assets that do not satisfy the definition of an investment property, the Group presents
those assets as the same item as the item that the corresponding underlying asset would have been
presented for. Right-of-use assets that meet the definition of investment properties would be presented as
investment properties.
The Group presents lease liability as other financial liabilities in the consolidated statement of financial
position.
iii) Regulation on lease terms
On the date of initial application, a lease classified as an operating lease in accordance with K-IFRS 1017 is
measured at present value of the remaining lease payments discounted at the incremental borrowing rate of
the subsidiary as of January 1, 2019. However, the Group chose an exception that does not apply the
lessee’s recognition, measurement and presentation on low value asset leases. The right-of-use asset is
measured as follows:
- The same amount as lease liability (pre-paid or incurred (unpaid) lease payments are adjusted). The Group
applies this method to all leases.
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When the Group applies K-IFRS 1116 to the leases classified as operating leases in accordance with K-
IFRS 1017, following practical expedients are used:
- Opening direct costs are excluded from the measurement of the right-of-use asset at the date of initial
application.
- An entity should apply K-IFRS 1037 ‘Provisions, Contingent Liabilities and Contingent Assets’ right
before the date of initial application to determine whether a lease is a loss-bearing contract and
therefore conduct an impairment review.
- The right-of-use assets and lease liabilities are not recognized for short-term leases (residual term less
than a year)
- If the contract includes a lease extension or exit option, use hindsight to determine the lease term.
iv)
Impacts to the financial statements
a)
Impacts at date of initial application
At the date of initial application of K-IFRS 1116, the Group additionally recognized the right-of-use assets
and lease liabilities, and the impacts as of January 1, 2019 are as follows (Unit: Korean Won in millions):
Right-of-use assets presented as premises and equipment(*)
Lease liability(*)
January 1, 2019
435,791
377,030
(*) The differences have occurred due to prepaid, unpaid lease payment, transfer, etc. and there is no effect on retained
earnings.
When measuring lease liabilities for leases that were previously classified as operating lease, the Group used
its incremental borrowing rate as of January 1, 2019 as the discount rate. The applied weighted-average
incremental borrowing rate is 2.0~5.6%.
Operating leases as of December 31, 2018
- Application of exemption rule for low value assets leases
- Application of exemption rule for leases with remaining terms are less than 12 months
at the time of transition
Operating lease agreement after subtraction of exemption rule applied items as of
December 31, 2018
Amount discounted with incremental borrowing rate at the date of initial
application(January 1, 2019)
Lease liabilities recognized at the date of initial application(January 1, 2019)
January 1, 2019
398,147
(616)
(187)
397,344
377,030
377,030
b)
Impacts during the transition
The Group recognized depreciation expenses and interest expenses instead of the operating lease expenses
for the leases in line with K-IFRS 1116. The Group recognized depreciation expenses of 229,727 million
Won and interest expenses of 9,086 million Won for the lease for the year ended December 31, 2019.
③ It is believed that the following issued, revised standards will not have a significant impact on the
Group.
- K-IFRS 2123 Uncertainty over Income Tax Treatments (Issued)
- K-IFRS 1109 Financial Instrument (Revised)
- K-IFRS 1028 Investment in Associates and Joint Ventures (Revised)
- K-IFRS 1019 Employee Benefits (Revised)
- K-IFRS 1115 Revenue from Contracts with Customers (Revised)
- Annual Improvements to IFRSs 2015-2017 Cycle
The annual improvements include partial amendments of K-IFRS 1012 ‘Income Tax,’ K-IFRS 1023
‘Borrowing Cost,’ K-IFRS 1103 ‘Business Combination’ and K-IFRS 1111 ‘Joint Arrangements’.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 13 -
191
2)
-
-
-
The details of K-IFRSs that have been issued and published as of the date of issue approval of
financial statements but have not yet reached the effective date, and which the Group has not applied
at an earlier date are as follows:
Revised Conceptual Framework for Financial Reporting
Revised K-IFRS 1103 ‘Business Combinations’
Revised K-IFRS 1001 ‘Financial Statements Presentation’ and K-IFRS 1008 ‘Change and Error of
Accounting Policy and Accounting Estimates’
It will be applied to period beginning on or after January 1, 2020. It is believed that revised standards listed
above, will not have a significant impact on the company
3)
The standards and interpretations that are newly adopted by the Group during the previous period, and
the changes in accounting policies thereof are as follows:
- Adoption of K-IFRS 1109 – Financial instruments
The Group initially applied K-IFRS 1109 and related amendments made to other standards during the
previous period, with January 1, 2018 as the date of initial application. K-IFRS 1109 introduces new
rules on: 1) classification and measurement of financial assets and financial liabilities, 2) impairment of
financial assets, and 3) hedge accounting. Additionally, the Group adopted consequential amendments to
K-IFRS 1037 Financial Instruments: Disclosures that were applied to the disclosures for 2018.
a) Classification and measurement of financial assets
All financial assets included in the scope of K-IFRS 1109 are subsequently measured at amortized cost
or fair value based on the Group’s business model for the management of financial assets and the nature
of the contractual cash flows of the financial assets.
Debt instruments that are held within a business model whose objective is to collect the contractual cash
flows, and that have contractual cash flows that are solely payments of principal and interest on the
principal outstanding are generally measured at amortized cost at the end of subsequent accounting
periods (Financial assets at amortized cost).
Debt instruments that are held within a business model whose objective is achieved both by collecting
contractual cash flows and selling financial assets, and that have contractual cash flows that are solely
payments of principal and interest on the principal outstanding are generally measured at fair value
through other comprehensive income (Financial assets at fair value through other comprehensive income
(“FVTOCI”)).
All other debt instruments and equity instruments are measured at their fair value at the end of
subsequent accounting periods, and any change in the fair value is recognized as profit or loss (Financial
assets at fair value through profit or loss (“FVTPL”)).
Notwithstanding the foregoing, the Group may make the following irrevocable choice or designation at
the time of initial recognition of a financial asset.
The Group may make an irrevocable election to present in other comprehensive income subsequent
changes in the fair value of an investment in an equity instrument within the scope of this standard that
is neither held for trading nor is a contingent consideration recognized by an acquirer in a business
combination to which K-IFRS 1103 applies.
At initial recognition, financial assets at amortized cost or FVTOCI may be irrevocably designated as
financial assets at fair value through profit or loss mandatorily measured at fair value if doing so
eliminates or significantly reduces a measurement or recognition inconsistency.
As of the date of initial application of K-IFRS 1109, there are no debt instruments classified either as
financial assets at amortized cost or FVTOCI that are designated as financial assets at fair value through
profit or loss.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 192
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When debt instruments measured at FVTOCI are derecognized, the cumulative gain or loss recognized
in other comprehensive income is reclassified from equity to profit or loss as a reclassification
adjustment. On the other hand, for equity instruments designated as financial assets at fair value through
other comprehensive income, cumulative gains or losses previously recognized in other comprehensive
income are subsequently reclassified to retained earnings. Debt instruments measured subsequently at
amortized cost or at FVTOCI are subject to impairment.
The classification and measurement of financial assets and liabilities in accordance with K-IFRS 1109 and K-
IFRS 1039 as of January 1, 2018 are as follows (Unit: Korean Won in millions):
Classification in
accordance with
K-IFRS 1039
Classification in
accordance with
K-IFRS 1109
Amount in
accordance with
K-IFRS 1039
Reclassificat
-ion
Remeasure-
ment(*2)
Amount in
accordance with
K-IFRS 1109
Deposit
Loans and
receivables
Deposit
Financial assets at
Loan and other
financial assets at
amortized cost
Financial assets at
FVTPL
FVTPL
Debt securities
Financial assets at
Financial assets at
FVTPL
FVTPL(*1)
Equity securities
Financial assets at
Financial assets at
Derivative assets Financial assets at
Financial assets at
FVTPL
FVTPL(*1)
Equity securities
FVTPL
AFS financial
assets
Equity securities
AFS financial
assets
FVTPL(*1)
Financial assets at
FVTPL(*1)
Financial assets at
FVTOCI
Debt securities
AFS financial
Financial assets at
Debt securities
AFS financial
Financial assets at
assets
FVTPL
Debt securities
AFS financial
assets
assets
FVTOCI
Securities at
amortized cost
Debt securities
HTM financial
Securities at
Loans
Loans
assets
Loans and
receivables
Loans and
receivables
Derivative assets
(Designated
for hedging)
Other financial
Derivative assets
(Designated for
hedging)
Loans and
assets
receivables
amortized cost
Financial assets at
FVTPL (*1)
Loan and other
financial assets at
amortized cost
Derivative assets
(Designated for
hedging)
Loan and other
financial assets at
amortized cost
Total financial assets
8,870,835
25,972
2,654,027
47,304
-
-
-
-
3,115,775
(2,137)
1,273,498
1,219
850,207
46,855
12,874,209
308,181
16,749,296
-
-
-
-
-
279,032
918
253,014,491
59,272
6,772,088
306,941,042
-
-
-
-
-
-
-
-
-
-
-
-
-
8,870,835
25,972
2,654,027
47,304
3,113,638
1,274,717
850,207
46,855
12,874,209
14,119
322,300
-
50
16,749,296
280,000
-
253,014,491
-
59,272
-
14,169
6,772,088
306,955,211
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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193
Deposit due to
customers
Deposit due to
customers
Borrowings
Debentures
Debentures
Equity-linked
securities
Derivatives
liabilities
Derivatives
liabilities
(Designated
for hedging)
Other financial
liabilities
Provision for
financial
guarantee
Classification in
Classification in
accordance with
K-IFRS 1039
Financial liabilities
accordance with
K-IFRS 1109
Financial liabilities at
at FVTPL
FVTPL
Financial liabilities
at amortized cost
Financial liabilities
at amortized cost
Financial liabilities
Financial liabilities at
amortized cost
Financial liabilities at
amortized cost
Financial liabilities at
at FVTPL
FVTPL
Financial liabilities
at amortized cost
Financial liabilities
Financial liabilities at
amortized cost
Financial liabilities at
at FVTPL
FVTPL
Financial liabilities
Financial liabilities at
at FVTPL
Derivatives
liabilities
(Designated for
hedging)
Financial liabilities
at amortized cost
Provision
FVTPL
Derivatives liabilities
(Designated for
hedging)
Financial liabilities at
amortized cost
Financial liabilities at
amortized cost
Total financial liabilities
Amount in
accordance with
K-IFRS 1039
Reclassifica-
tion
Remeasure-
ment(*2)
Amount in
accordance with
K-IFRS 1109
25,964
234,695,084
14,784,706
91,739
27,869,651
160,057
3,150,149
67,754
13,892,461
71,697
294,809,262
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
25,964
234,695,084
14,784,706
91,739
27,869,651
160,057
3,150,149
67,754
13,892,461
71,697
294,809,262
(*1) Under K-IFRS 1039, the embedded derivatives out of hybrid financial instruments were accounted for as
derivative assets or liabilities if the criteria for separation of the embedded derivatives were met; and the host
contracts in those instruments were recorded as available-for-sale financial assets or loans and receivables
respectively. However, since K-IFRS 1109 requires financial instruments to be accounted for based on the terms of
the entire financial instrument, hybrid financial assets are revalued and classified as financial assets at fair value
through profit or loss.
(*2) The remeasurement effect due to expected credit losses is not included (The remeasurement effect of expected
credit losses is as follows: b) Impairment of financial assets).
At the date of the initial application of K-IFRS 1109, there were no financial assets or liabilities measured at
FVTPL that were reclassified to FVTOCI or amortized cost category.
The financial assets at FVTPL or FVTOCI that are reclassified to the amortized cost measurement category
as of the date of initial application of K-IFRS 1109, and the related valuation gain or loss and fair value of
the financial assets as of December 31, 2018 had it not been reclassified, are as follows (Unit: Korean Won in
millions):
Account subject
Category before the adoption of
K-IFRS 1109
Amount of valuation gain/loss
had it not been reclassified
Fair value
Debt securities(*)
AFS financial assets
2
257,665
(*) Those financial assets that are removed from the books as of December 31, 2018 are not presented in the table
above.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
194
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b) Impairment of financial assets
The impairment model under K-IFRS 1109 reflects expected credit losses, as opposed to incurred credit
losses under K-IFRS 1039. Under the impairment approach in K-IFRS 1109, it is no longer necessary for a
credit event to have occurred before credit losses are recognized. Instead, the Group accounts for expected
credit losses and changes in those expected credit losses. The amount of expected credit losses should be
updated at each reporting date to reflect changes in credit risk since initial recognition.
The Group is required to recognize the expected credit losses for financial instruments measured at amortized
cost or FVTOCI (debt instrument), and unused loan commitments and financial guarantee contracts that are
subject to the impairment provisions of K-IFRS 1109. In particular, K-IFRS 1109 requires the Group to
measure the loss allowance for a financial instrument at an amount equal to the lifetime expected credit
losses (ECL) if the credit risk on that financial instrument has increased significantly since initial recognition,
or if the financial instrument is a purchased or originated credit-impaired financial asset. If the credit risk of a
financial instruments does not increase significantly after initial recognition (excluding “purchased or
originated credit-impaired loans” - for financial assets already impaired at initial recognition), the Group
measures the loss allowance on the financial instruments at the amount equivalent to the expected 12-month
credit loss.
Management assessed the impairment of the Group's financial assets, lending arrangements and financial
guarantees at the date of initial application by using reasonable and supportive measures that can be used
without undue cost or effort in determining the credit risk of the financial instruments at initial recognition in
accordance with K-IFRS 1109 and in comparing above credit risk with the credit risk at the date of initial
application. As of January 1, 2018, the results of the assessment are as follows (Unit: Korean Won in
millions):
Classification in
accordance with
K-IFRS 1039
Classification in
accordance with
K-IFRS 1109
Loss allowance in
accordance with
K-IFRS 1039(A)
Loss allowance in
accordance with
K-IFRS 1109 (B)
Increases
(B-A)
HTM securities HTM financial
Loans and
receivables
Loans and other
financial assets at
amortized cost
AFS financial
assets
assets
Loans and
receivables
Financial assets at
FVTOCI
Securities at
amortized cost
Loans and other
financial assets
at amortized cost
Deposit
Debt securities
AFS securities
Loans and other
financial assets
Payment
guarantee
Loan
commitment
Total
c) Classification and measurement of financial liabilities
2,458
3,092
634
-
-
4,236
5,078
4,236
5,078
1,827,785
2,076,873
249,088
183,247
192,924
9,677
66,115
2,079,605
104,985
2,387,188
38,870
307,583
One of the major changes related to the classification and measurement of financial liabilities as a result of
the adoption of K-IFRS 1109 is the accounting for change in the fair value of financial liabilities designated
as at fair value through profit or loss due to the changes in issuer’s own credit risk. The Group recognizes the
effect of changes in the credit risk of financial liabilities designated as at FVTOCI in other comprehensive
income, except for cases where it creates or enlarges accounting mismatch of the profit or loss. Changes in
fair value due to credit risk of financial liabilities are not subsequently reclassified to profit or loss, but are
reclassified as retained earnings when financial liabilities are derecognized.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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195
In accordance with K-IFRS 1039, the entire of changes in fair value of financial liabilities designated as at
FVTPL are recognized in profit or loss. As of January 1, 2018, the Group designated 251,796 million Korean
Won of FVTPL out of 294,813,795 million of financial liabilities to be measured at FVTPL, and recognized
133 million Korean Won as accumulated other comprehensive loss in relation to the changes in own credit
risk of financial liabilities.
d) Hedge accounting
The new hedge accounting model maintains three types of hedge accounting. However, it introduced more
flexibility in the types of transactions that are eligible for hedge accounting and expanded the types of
hedging instruments and non-financial hedge items that qualify for hedge accounting. The standard related to
the evaluation of hedge accounting has been amended as a whole, where it is now replaced by the principle of
"economic relationship" between the hedged item and the hedging instrument. Retrospective assessment of
the hedging effectiveness is no longer required. Additional disclosure requirements have been introduced in
relation to the Group's risk management activities.
In accordance with the transitional provisions of K-IFRS 1109 on hedge accounting, the Group adopted the
hedge accounting provisions of K-IFRS 1109 prospectively from January 1, 2018. As of the date of initial
application, the Group concluded that the hedging relationship in accordance with K-IFRS 1039 is
appropriate for hedge accounting under K-IFRS 1109, thus the hedging relationship is considered to exist
continually. Since the major conditions for hedging instruments and the hedged items are consistent, all
hedging relationships are consistent within the effectiveness assessment requirements of K-IFRS 1109. The
Group has not designated a hedging relationship in accordance with K-IFRS 1109 in which the hedge
relationship would not have met the requirements for hedge accounting under K-IFRS 1039.
e) Effect on equity as a result of adoption of K-IFRS 1109
The effect on equity due to the adoption of K-IFRS 1109 as of January 1, 2018 is as follows (Unit: Korean
Won in millions):
-
Impact on accumulated other comprehensive loss due to financial assets at FVTOCI, etc.
Balance as of December 31, 2017 (prior to K-IFRS 1109)
Adjustments
Reclassification of available-for-sale financial assets to financial assets at FVTPL
Recognition of expected credit losses of debt securities at FVTOCI
Reclassification of available for sale financial assets(equity securities) to financial
assets at FVTOCI
Effect on changes in credit risk of financial liabilities at fair value through profit
or loss designated as upon initial recognition
Others
Income tax effect
Balance as of January 1, 2018 (based on K-IFRS 1109)
Amount
(89,724)
(392,176)
(152,124)
4,293
(397,508)
(133)
3,500
149,796
(481,900)
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 196
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- Retained earnings impact
Balance as of December 31, 2017 (prior to K-IFRS 1109)
Adjustments
Reclassification of available-for-sale financial assets to financial assets at FVTPL
Recognition of expected credit losses of debt instruments at FVTOCI
Reclassification of available-for-sale financial assets(equity securities) to financial assets at
FVTOCI
Effect on revaluation of financial assets at amortized cost from loan and receivables or AFS
financial assets
Recognition of expected credit losses of financial assets at amortized cost which were
previously loan and receivables
Effect on provision for guarantees and unused loan commitments on liabilities
Effect on changes in credit risk of financial liabilities at fair value through profit or loss
designated as upon initial recognition
Others
Income tax effect
Balance as of January 1, 2018 (based on K-IFRS 1109)
(2) Basis of consolidated financial statement presentation
Amount
15,620,006
177,091
152,124
(4,293)
397,508
282
(240,683)
(48,548)
133
(4,950)
(74,482)
15,797,097
The consolidated financial statements incorporate the financial statements of the Group and the entities
(including structured entities) controlled by the Group (and its subsidiaries, which is the “Group”). Control is
achieved where the Group 1) has the power over the investee, 2) is exposed, or has rights, to variable returns
from its involvement with the investee, and 3) has the ability to use its power to affect its returns. The Group
reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one
or more of the three elements of control listed above.
When the Group has less than a majority of the voting rights of an investee, it has power over the investee when
the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee
unilaterally. The Group considers all relevant facts and circumstances in assessing whether or not the Group's
voting rights in an investee are sufficient to give it power, including:
• The relative size of the Group's holding of voting rights and dispersion of holdings of the other vote
holders;
• Potential voting rights held by the Group, other vote holders or other parties;
• Rights arising from other contractual arrangements;
• Any additional facts and circumstances that indicate that the Group has, or does not have, the current
ability to direct the relevant activities at the time that decisions need to be made, including voting
patterns at previous shareholders' meetings.
Income and expenses of subsidiaries acquired or disposed of during the year are included in the consolidated
statement of comprehensive income from the date the Group gains control until the date when the Group ceases
to control the subsidiary. The carrying amount of the non-controlling interest after the acquisition is the amount
initially recognized plus the amount of proportionate interest of the non-controlling interest in the changes in
equity since the acquisition. Total comprehensive income of subsidiaries is attributed to the owner of the Group
and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting
policies into line with the Group’s accounting policies.
All intra-group transactions and, related assets and liabilities, income and expenses are eliminated in full on
consolidation.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 19 -
197
Non-controlling interest of a subsidiary are separately identified from the equity of the Group. Non-controlling
interests that are present ownership interests and entitle their holders to a proportionate share of the entity's net
assets in the event of liquidation may be initially measured either at fair value or at the non-controlling interests'
proportionate share of the recognized amounts of the acquiree's identifiable net assets. The choice of
measurement basis is made on a transaction-by-transaction basis. Other types of non-controlling interests are
measured at fair value. The carrying amount of the non-controlling interest after the acquisition is the amount
initially recognized with the amount entitled to the proportionate interest of the non-controlling interest when
there are changes in equity since the acquisition. Total comprehensive income of subsidiaries is attributed to the
owner of the Group and to the non-controlling interests even if this results in the non-controlling interests having
a deficit balance.
Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control over the
subsidiaries are accounted for as equity transactions. The carrying amounts of the Group’s interests and the non-
controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any
difference between the amount by which the non-controlling interests are adjusted and the fair value of the
consideration paid or received is recognized directly in equity and attributed to the owner of the parent company.
When the Group loses control of a subsidiary, a gain or loss on disposal is calculated as the difference between
(i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii)
the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-
controlling interests. When assets of the subsidiary are carried at revalued amounts or fair values and the related
cumulative gain or loss has been recognized in other comprehensive income and accumulated in equity, the
amounts previously recognized in other comprehensive income and accumulated in equity are accounted for as if
the Group had directly disposed of the relevant assets (i.e. reclassified to profit or loss or transferred directly to
retained earnings). The fair value of any investment retained in the former subsidiary at the date when control is
lost is recognized as the fair value on initial recognition for subsequent accounting under K-IFRS 1109 Financial
Instruments or, when applicable, the cost on initial recognition of an investment in an associate or a joint
venture.
(3) Business combinations
Acquisitions of subsidiaries and businesses are accounted for using the acquisition method. The consideration
transferred in a business combination is measured as the sum of the acquisition-date fair values of the assets
transferred by the Group in exchange for control of the acquiree, liabilities assumed by the Group for the former
owners of the acquiree and the equity interests issued by the Group. Acquisition-related costs are generally
recognized in profit or loss as incurred.
At the acquisition date, the acquiree’s identifiable acquires assets, liabilities and contingent liabilities that meet
the condition for recognition under K-IFRS 1103 are recognized at their fair value, except for the followings:
• deferred tax assets or liabilities and assets or liabilities related to employee benefit arrangements are
•
recognized and measured in accordance with K-IFRS 1012 Income Taxes and K-IFRS 1019 Employee
Benefits, respectively;
liabilities or equity instruments related to share-based payment arrangements of the acquiree or share-
based payment arrangements of the Group entered into to replace share-based payment arrangements of
the acquiree are measured in accordance with K-IFRS 1102 Share-based Payment at the acquisition date;
and
• non-current assets (or disposal groups) that are classified as held for sale are measured in accordance
with K-IFRS 1105 ‘Non-current Assets Held for Sale and Discontinued Operations’
Any excess of the sum of the consideration transferred, the amount of any non-controlling interest in the
acquiree and the fair value of the Group’s previously held equity interest (if any) in the acquiree over the net of
identifiable assets and liabilities assumed of the acquiree at the acquisition date is recognized as goodwill.
If, after reassessment, the Group’s interest in the fair value of the acquiree’s identifiable net assets exceeds the
sum of the consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value
of the acquirer’s previously held equity interest in the acquiree (if any), the excess is recognized immediately in
net income as a bargain purchase gain.
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When the consideration transferred by the Group in a business combination includes assets or liabilities resulting
from a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair
value and included as part of the consideration transferred in a business combination. Changes in the fair value
of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with
corresponding adjustments against goodwill. Measurement period adjustments are adjustments that arise from
additional information obtained during the ‘measurement period’ (which cannot exceed one year from the
acquisition date) about facts and circumstances that existed at the acquisition date.
The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as
measurement period adjustments depends on how the contingent consideration is classified. Contingent
consideration that is classified as equity is not remeasured at subsequent reporting dates and its subsequent
settlement is accounted for within equity. Contingent consideration other than the above is remeasured at
subsequent reporting dates as appropriate, with the corresponding gain or loss being recognized in profit or loss.
When a business combination is achieved in stages, the Group's previously held equity interest in the acquiree is
remeasured at fair value at the acquisition date (i.e., the date when the Group obtains control) and the resulting
gain or loss, if any, is recognized in net income(or other comprehensive income, if applicable). Amounts arising
from changes in value of interests in the acquiree prior to the acquisition date that have previously been
recognized in other comprehensive income are recognized, identical to the treatment assuming interests are sold
directly.
In case where i) a common entity ultimately controls over all participating entities, or businesses, in a business
combination transaction, prior to and after the transaction continuously, and ii) the control is not temporary, the
transaction meets the definition of “business combination under common control” and it is deemed that the
transaction only results in the changes in legal substance, and not economic substance, from the perspective of
the ultimate controlling party. Thus, in such transactions, the acquirer recognizes the assets and liabilities of the
acquiree in its financial statements at the book values as recognized in the ultimate controlling party’s
consolidated financial statements, and the difference between the book value of consideration transferred to and
the book value of net assets transferred in is recognized as equity.
If the initial accounting for a business combination is not completed by the end of the reporting period in which
the business combination occurred, the Group reports in consolidated financial statements the provisional
amount of items that have not been accounted for. If there is new information about the facts and circumstances
that existed as of the acquisition date during the measurement period (see above), the Group retrospectively
adjusts the provisional amounts recognized at the acquisition date or recognizes additional assets and liabilities
to reflect the information that would have affected the measurement of the amount recognized at the acquisition
date if it had already known at the acquisition date.
(4) Investments in joint ventures and associates
An associate is an entity over which the Group has significant influence, and that is not a subsidiary or a joint
venture. Significant influence is the power to participate in making decision on the financial and operating policy
of the investee but is not control or joint control over those policies.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights
to net assets relating to the arrangement. Joint control is the contractually agreed sharing of control of an
arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the
parties sharing control.
The net income of current period and the assets and liabilities of the joint ventures and associates are
incorporated in these consolidated financial statements using the equity method of accounting, except when the
investment is classified as held for sale, in which case it is accounted for in accordance with K-IFRS 1105 Non-
current Assets Held for Sale and Discontinued Operations. Under the equity method, an investment in the joint
ventures and associates is initially recognized in the consolidated statements of financial position at cost and
adjusted thereafter to recognize the Group's share of the net assets of the joint ventures and associates and any
impairment. When the Group's share of losses of the joint ventures and associates exceeds the Group's interest in
the associate, the Group discontinues recognizing its share of further losses. Additional losses are recognized
only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of
the joint ventures and associates.
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Investment in joint ventures and associates are accounted for and applied with the equity method from the time
the investee becomes an associate or a joint venture.
Any excess of the cost of acquisition over the Group's share of the net fair value of the identifiable assets,
liabilities and contingent liabilities of the joint ventures and associates recognized at the date of acquisition is
recognized as goodwill, which is included within the carrying amount of the investment. Any excess of the
Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of
acquisition exists after the review, it is recognized immediately in net income.
The requirements of K-IFRS 1028 - Investments in Associates and Joint Ventures to determine whether there has
been a loss event are applied to identify whether it is necessary to recognize any impairment loss with respect to
the Group’s investment in the joint ventures and associates. When necessary, the entire carrying amount of the
investment (including goodwill) is tested for impairment in accordance with K-IFRS 1036 - Impairment of
Assets as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs to
sell) with its carrying amount. Any impairment loss recognized is not allocated to any asset (including goodwill),
which forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognized in
accordance with K-IFRS 1036 to the extent that the recoverable amount of the investment subsequently
increases.
The Group ceases to use the equity method from the time it fails meet the definition of an associate or a joint
venture. Upon a loss of significant influence over the joint ventures and associates, the Group discontinues the
use of the equity method and measures at fair value of any investment that the Group retains in the former joint
ventures and associates from the date when the Group loses significant influence. The fair value of the
investment is regarded as its fair value on initial recognition as a financial asset in accordance with K-IFRS 1109
Financial Instruments; Recognition and Measurement. The Group recognized differences between the carrying
amount and fair value in net income and it is included in determination of the gain or loss on disposal of joint
ventures and associates. The Group accounts for all amounts recognized in other comprehensive income in
relation to that joint ventures and associates on the same basis as would be required if the joint ventures and
associates had directly disposed of the related assets or liabilities. Therefore, if a gain or loss previously
recognized in other comprehensive income by an associate or a joint venture would be reclassified to net income
on the disposal of the related assets or liabilities, the Group reclassifies the gain or loss from equity to net
income as a reclassification adjustment.
When the Group’s ownership of interest in an associate or a joint venture decreases but the Group continues to
maintain significant influence over an associate or a joint venture, the Group reclassifies to profit or loss the
proportion of the gain or loss that had previously been recognized in other comprehensive income relating to that
decrease in ownership interest if the gain or loss would be reclassified to profit or loss on the disposal of the
related assets or liabilities. Meanwhile, if interest on associate or joint venture meets the definition of non-
current asset held for sale, it is accounted for in accordance with K-IFRS 1105.
The Group continues to use the equity method when an investment in an associate becomes an investment in a
joint venture or an investment in a joint venture becomes an investment in an associate. There is no
remeasurement to fair value upon such changes in ownership interests.
When a subsidiary transacts with an associate or a joint venture of the Group, profits and losses resulting from
the transactions with the associate or joint venture are recognized in the Group's consolidated financial
statements only to the extent of interests in the associate or joint venture that are not related to the Group.
The Group applies K-IFRS 1109 ‘Financial Instruments’, including the impairment requirements, to its long-
term investment interests in associates and joint ventures that form part of its net investment without applying
the equity method. In addition, when applying K-IFRS 1109 to long-term investments, the Group does not
consider adjustments to the carrying amount required by K-IFRS 1028. Examples of such adjustments include an
impairment assessment or an adjustment to the carrying amount of the long-term investment interest resulting
from the allocation of losses to the investee in accordance with K-IFRS 1028.
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(5)
Investment in Joint operation
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have
rights to the assets, and obligations for the liabilities, relating to the arrangement. Joint control is the
contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant
activities require the unanimous consent of the parties sharing control.
When the Group operates as a joint operator, it recognizes in relation to its interest in a joint operation:
- its assets, including its share of any assets held jointly;
- its liabilities, including its share of any liabilities incurred jointly;
- its revenue from the sale of its share of the output arising from the joint operation;
- its share of the revenue from the sale of the output by the joint operation;
- its expenses, including its share of any expenses incurred jointly.
The Group accounts for the assets, liabilities, revenues and expenses relating to its interest in a joint operation in
accordance with the K-IFRSs applicable to the particular assets, liabilities, revenues and expenses.
When the Group enters into a transaction with a joint operation in which it is a joint operator, such as a sale or
contribution of assets, it is conducting the transaction with the other parties to the joint operation and, as such,
the Group recognizes gains and losses resulting from such a transaction only to the extent of the other parties’
interests in the joint operation.
When the Group enters into a transaction with a joint operation in which it is a joint operator, such as a purchase
of assets, it does not recognize proportional share of profit or loss until the asset is sold to a third party.
(6) Revenue recognition
K-IFRS 1115 requires the recognition of revenues based on transaction price allocated to the performance
obligation when or as the Group performs that obligation to the customer. Since revenues other than those from
contracts with customers, such as interest revenue and loan origination fee (cost), are measured through effective
interest rate method.
1) Revenues from contracts with customers
The Group recognizes revenue when the Group satisfies a performance obligation by transferring a
promised good or service to a customer. When a performance obligation is satisfied, the Group shall
recognizes as a revenue the amount of the transaction price that is allocated to that performance obligation.
The transaction price is the amount of consideration to which the Group expects to be entitled in exchange
for transferring promised goods or services to a customer, excluding amounts collected on behalf of third
parties.
The Group is recognizing revenue by major sources as shown below:
① Fees and commission received for brokerage
The fees and commission received for agency are the amount of consideration or fee expected to be entitled
to receive in return for providing goods or services to the other parties with the Group acting as an agency,
such as in the case of sales of bancassurance and beneficiary certificates. The majority of these fees and
commission received for brokerage are from the business activities relevant to Banking segment.
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② Fees and commission received related to credit
The fees and commission received related to credit mainly include the lending fees received from the loan
activity and the fees received in the L/C transactions. Except for the fees and commission accounted for in
calculating the effective interest rate, it is generally recognized when the performance obligation has been
performed. The majority of these fees and commission received related to credit are from the business
activities relevant to Banking, Credit card and Investment banking segment.
③ Fees and commission received for electronic finance
The fees and commission received for electronic finance include fees received in return for providing
various kinds of electronic financial services through firm-banking and CMS. These fees are recognized as
revenue immediately upon the completion of services. The majority of these fees and commission received
for electronic finance are from the business activities relevant to Banking and Investment banking segment.
④ Fees and commission received on foreign exchange handling
The fees and commission received on foreign exchange handling consist of various fees incurred when
transferring foreign currency. The point of processing the customer's request is the time when performance
obligation is satisfied, and revenue is immediately recognized when fees and commission are received after
requests are processed. The business activities relevant to these fees and commission received on foreign
exchange handling are substantially attributable to Banking segment.
⑤ Fees and commission received on foreign exchange
The fees and commission received on foreign exchange consist of fees related to the issuance of various
certificates, such as exchange, import and export performance certificates, purchase certificates, etc. The
point of processing the customer's request is the time when performance obligation is satisfied, and revenue
is immediately recognized when fees and commission are received after requests are processed. The
business activities relevant to these fees and commission received on foreign exchange are substantially
attributable to Banking segment.
⑥ Fees and commission received for guarantee
The fees and commission received for guarantee include the fees received for the various warranties. The
activities related to the warranty consist mainly of performance obligations satisfied over time and fees and
commission are recognized over the guarantee period. The business activities relevant to these fees and
commission received for guarantee are substantially attributable to Banking segment.
⑦ Fees and commission received on credit card
The fees and commission received on credit card consist mainly of merchant account fees and annual fees.
The Group recognizes merchant account fees by multiplying agreed commission rate to the amount paid by
using the credit card. The annual fees are performance obligation satisfied over time and are recognized
over agreed periods after the annual fees are paid in advance. The business activities relevant to these fees
and commission received on credit card are substantially attributable to Credit cards segment.
⑧ Fees and commission received on securities business
The fees and commission received on securities business consist mainly of fees and commission for the sale
of beneficiary certificates, and these fees are recognized when the beneficiary certificates are sold to
customers. The business activities relevant to these fees and commission received on securities business are
substantially attributable to Banking and Investment banking segment.
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⑨ Fees and commission from trust management
The fees and commission from trust management consist of fees and commission received in return for the
operation and management services for entrusted assets. These operation and management services are
performance obligations satisfied over time, and revenue is recognized over the service period. Among the
fees and commission from trust management, variable considerations such as profit commission that are
affected by the value of entrusted assets and base return of the future periods are recognized as revenue
when limitations to the estimates are lifted. The majority of these fees and commission received for
brokerage are from the business activities relevant to Banking segment.
⑩ Fees and commission received on credit Information
The fees and commission received on credit Information are composed of the fees and commission
received by performing credit investigation and proxy collection services. Credit investigation fees and
commission are the amount received in return for verifying the information requested by the customer and
are recognized as revenue at the time the verification is completed. Proxy collection service fees are
recognized by multiplying the applicable rate to the collected amount at the time when collection services
are completed. The majority of these fees and commission received for brokerage are from the business
activities relevant to other segment.
⑪ Other fees
Other fees are usually fees related to remittances, but include fees related to various other services provided
to customers by the Group. These fees are recognized when transactions occur at the customers' request and
services are provided, at the same time when commission are received. These other fees occur across all
operating segments.
2) Revenues from sources other than contracts with customers
① Interest income
Interest income on financial assets measured at FVTOCI and financial assets at amortized costs is measured
using the effective interest method.
The effective interest method is a method of calculating the amortized cost of a debt instrument and of
allocating the interest income over the expected life of the asset. The effective interest rate is the rate that
exactly discounts estimated future cash flows to the instrument's initial unamortized cost over the expected
period, or shorter if appropriate. Future cash flows include commissions and cost of reward points(limited
to the primary component of effective interest rate) and other premiums or discounts that are paid or
received between the contractual parties when calculating the effective interest rate, but does not include
expected credit losses. All contractual terms of a financial instrument are considered when estimating
future cash flows.
For purchased or originated credit-impaired financial assets, interest revenue is recognized by applying the
credit-adjusted effective interest rate to the amortized cost of the financial asset from initial recognition.
Even if the financial asset is no longer impaired in the subsequent periods due to credit improvement, the
basis of interest revenue calculation is not changed from amortized cost to unamortized cost of the financial
assets.
② Loan origination fees and costs
The commission fees earned on loans, which is part of the effective interest of loans, is accounted for as
deferred origination fees. Incremental costs related to the origination of loans are accounted for as deferred
origination fees and is being added or deducted to/from interest income on loans using effective interest
rate method.
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(7) Accounting for foreign currencies
The Group’s consolidated financial statements are presented in Korean Won, which is the functional currency of
the Group. At the end of each reporting period, monetary assets and liabilities denominated in foreign currencies
are translated to the functional currency at its prevailing exchange rates at the date. The effective portion of the
changes in fair value of a derivative that qualifies as a cash flow hedge and the foreign exchange differences on
monetary items that form part of net investment in foreign operations are recognized in equity.
Assets and liabilities of the foreign operations subject to consolidation are translated into Korean Won at foreign
exchange rates at the end of the reporting period. Except for situations in which it is required to use exchange
rates at the date of transaction due to significant changes in exchange rates during the period, items that belong
to profit or loss shall be measured by average exchange rate, with foreign exchange differences recognized as
other comprehensive income and added to equity (allocated to non-controlling interests, if appropriate). When
foreign operations are disposed, the controlling interest’s share of accumulated foreign exchange differences
related to such foreign operations will be reclassified to profit or loss, while non-controlling interest’s
corresponding share will not be reclassified.
Adjustments to fair value of identifiable assets and liabilities, and goodwill arising from the acquisition of
foreign operations will be treated as assets and liabilities of the corresponding foreign operation, and is translated
using foreign exchange rates at the end of the period. The foreign exchange differences are recognized in other
comprehensive income.
(8) Cash and cash equivalents
The Group is classifying cash on hand, demand deposits, interest-earning deposits with original maturities of up
to three months on acquisition date, and highly liquid investments that are readily convertible to known amounts
of cash and subject to an insignificant risk of changes in value as cash and cash equivalents.
(9) Financial assets and financial liabilities
1)
Financial assets
A regular way purchase or sale of financial assets is recognized or derecognized on the trade or settlement
date. A regular way purchase or sale is a purchase or sale of a financial asset under a contract whose term
requires delivery of the asset within the time frame established generally by regulation or convention in the
marketplace concerned.
On initial recognition, financial assets are classified into financial assets at FVTPL, financial assets at
FVTOCI, and financial assets at amortized cost according to its business model and contractual cash flows.
a) Business model
The Group evaluates the way business is being managed, and the purpose of the business model for
managing a financial asset best reflects the way information is provided to the management at its portfolio
level. Such information considers the following:
- The accounting policies and purpose specified for the portfolio, the actual operation of such policies. This
includes strategy of the management focusing on the receipt of contractual interest revenue, maintaining a
certain level of interest income, matching the duration of financial assets and the duration of
corresponding liabilities to obtain the asset, and outflow or realization of expected cash flows from
disposal of assets
- The way the performance of a financial asset held under the business model is evaluated, and the way
such evaluation is being reported to the management
- The risk affecting the performance of the business model (and financial assets held under the business
model), and the way such risk is being managed
- The compensation plan for the management (e.g. whether the management is being compensated based on
the fair value of assets or based on contractual cash flows received)
- Frequency, amount, timing and reason for sale of financial assets in the past, and forecast of future sale
activities.
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b)
Contractual cash flows
The principal is defined to be the fair value of a financial assets at initial recognition. Interest is not only
composed of consideration for the time value of money, consideration for the credit risk related to
remaining principal at a certain period of time, and consideration for other cost (e.g. liquidity risk and cost
of operation) and fundamental risk associated with lending, but also profit.
When evaluating whether contractual cash flows are solely payments of principal and interests, the Group
considers the contractual terms of the financial instrument. When a financial asset contains contractual
conditions that modify the timing and amount of contractual cash flows, it is required to determine whether
contractual cash flows that arise during the remaining life of the financial instrument due to such
contractual condition are solely payments of principal and interest. The Group considers the following
elements when evaluating the above:
- Conditions that lead to modification of timing or amount of cash flows
- Contractual terms that adjust contractual nominal interest, including floating rate features
- Early payment features and maturity extension features
- Contractual terms that limit the Group’s claim on cash flows arising from certain assets (e.g. non-recourse
feature)
① Financial assets at FVTPL
The Group is classifying those financial assets that are not classified as either financial assets at amortized
cost or financial assets at FVTOCI, and those designated to be measured at FVTPL, as financial assets at
FVTPL. Financial assets at FVTPL are measured at fair value, and related profit or loss is recognized in net
income. Transaction costs related to acquisition at initial recognition is recognized in net income
immediately upon its occurrence.
It is possible to designate a financial asset as financial asset at FVTPL if at initial recognition: (a) it is
possible to remove or significantly reduce recognition or measurement mismatch that may otherwise have
occurred if not for its designation as financial asset at FVTPL; (b) the financial asset forms part of the
Group’s financial instrument group (a group composed of a combination of financial asset or liability), is
measured at fair value and is being evaluated for its performance, and such information is provided
internally; and (c) the financial asset is part of a contract that contains one or more of embedded derivatives,
and is a hybrid contract in which designation as financial asset at FVTPL is allowed under K-IFRS 1109
‘Financial Instruments’. However, the designation is irrevocable.
② Financial assets at FVTOCI
When financial assets are held under a business model whose objective is achieved by both collecting
contractual cash flows and selling financial assets, and when contractual cash flows from such financial
assets are solely payments of principal and interest, the financial assets are classified as financial assets at
FVTOCI. Also, for investments in equity instruments that are not held for short-term trade, an irrevocable
election is available at initial recognition to present subsequent changes in fair value as other
comprehensive income.
At initial recognition, financial assets at FVTOCI is measured at its fair value plus any direct transaction
cost, and is subsequently measured in fair value. However, for equity instruments that do not have a
quotation in an active market and in which fair value cannot be measured reliably, they are measured at
cost. The income tax effects related to the changes in fair value except for profit or loss items such as
impairment losses (reversals), interest revenue calculated by using effective interest method, and foreign
exchange gain or loss about debt instrument are recognized as other comprehensive income until the asset’s
disposal. Upon derecognition, the accumulated other comprehensive income is reclassified from equity to
net income for FVTOCI (debt instrument), and reclassified within the equity for FVTOCI (equity
instruments).
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③ Financial assets at amortized cost
When financial assets are held under a business model whose objective is to hold financial assets in order to
collect contractual cash flows, and when contractual cash flows from such financial assets are solely
payments of principal and interest, the financial assets are classified as financial assets at amortized cost. At
initial recognition, financial assets at amortized cost are recognized at fair value plus any direct transaction
cost. Financial assets at amortized cost is presented at amortized cost using effective interest method, less
any loss allowance.
2)
Financial liabilities
At initial recognition, financial liabilities are classified into either financial liabilities at FVTPL or financial
liabilities at amortized cost.
Financial liabilities are usually classified as financial liabilities at FVTPL when they are acquired with a
purpose to repurchase them within a short period of time, when they are part of a certain financial
instrument portfolio that is actually and recently being managed with a purpose of short-term profit and
joint management by the Group at initial recognition, and when they are derivatives that do not qualify as
hedging instruments. Financial liabilities at FVTPL are measured at fair value plus direct transaction cost at
initial recognition, and are subsequently measured at fair value. Profit or loss arising from financial
liabilities at FVTPL is recognized in net income when occurred.
It is possible to designate a financial liability as financial liability at FVTPL if at initial recognition: (a) it is
possible to remove or significantly reduce recognition or measurement mismatch that may otherwise have
occurred if not for its designation as financial liability at FVTPL; (b) the financial asset forms part of the
Group’s financial instrument group (a group composed of a combination of financial asset or liability)
according to the Group’s documented risk management or investment strategy, is measured at fair value
and is being evaluated for its performance, and such information is provided internally; and (c) the financial
liability is part of a contract that contains one or more of embedded derivatives, and is a hybrid contract in
which designation as financial liability at FVTPL is allowed under K-IFRS 1109 ‘Financial Instruments’.
Financial liabilities designated as at FVTPL are initially recognized at fair value, with any direct transaction
cost recognized in profit or loss, and are subsequently measured at fair value. Any profit or loss from
financial liabilities at FVTPL are recognized in profit or loss.
Financial liabilities not classified as financial liabilities at FVTPL are measured at amortized cost. The
Group is classifying liabilities such as deposits due to customers, borrowings and debentures as financial
liabilities at amortized cost.
3) Reclassification
Financial assets are not reclassified after initial recognition unless the Group modifies the business model
used to manage financial assets. When the Group modifies the business model used to manage financial
assets, all affected financial assets are reclassified on the first day of the first reporting period after the
modification.
4) Derecognition
Financial assets are derecognized when contractual rights to cash flows from the financial assets are
expired, or when substantially all of risk and reward for holding financial assets is transferred to another
entity as a result of a sale of financial assets. If the Group does not have and does not transfer substantially
all of the risk and reward of holding financial assets with control of the transferred financial assets retained,
the Group recognizes financial assets to the extent of its continuing involvement. If the Group holds
substantially all the risk and reward of holding a financial asset, it continues to recognize that asset and
proceeds are accounted for as collateralized borrowings.
When a financial asset is fully derecognized, the difference between the book value and the sum of
proceeds and accumulated other comprehensive income is recognized as profit or loss in case of FVTOCI
(debt instruments), and as retained earnings for FVTOCI (equity instruments).
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In case when a financial asset is not fully derecognized, the Group allocates the book value into amounts
retained in the books and removed from the books, based on the relative fair value of each portion at the
date of sale, and based on the degree of continuing involvement. For the derecognized portion of the
financial assets, the difference between its book value and the sum of proceeds and the portion of
accumulated other comprehensive income attributable to that portion will be recognized in profit or loss in
case of debt instruments and recognized in retained earnings in case of equity instruments. The
accumulated other comprehensive income is distributed to the portion of book value retained in the books,
and to the portion of book value removed from the books.
The Group derecognizes financial liabilities when, and only when, the Group’s obligations are discharged,
cancelled or have expired. The difference between the carrying amount of the financial liability
derecognized and the consideration paid and payable is recognized in profit or loss.
When the Group exchanges with the existing lender one debt instrument into another one with the
substantially different terms, such exchange is accounted for as an extinguishment of the original financial
liability and the recognition of a new financial liability. Similarly, the Group accounts for substantial
modification of terms of an existing liability or part of it as an extinguishment of the original financial
liability and the recognition of a new liability. It is assumed that the terms are substantially different if the
discounted present value of the cash flows under the new terms, including any fees paid net of any fees
received and discounted using the original effective rate is at least 10 percent different from the discounted
present value of the remaining cash flows of the original financial liability
5)
Fair value of financial instruments
Financial assets at FVTPL and financial assets at FVTOCI are measured and presented in consolidated
financial statements at their fair values, and all derivatives are also subject to fair value measurement.
Fair value is defined as the price that would be received to exchange an asset or paid to transfer a liability
in a recent transaction between independent parties that are reasonable and willing. Fair value is the
transaction price of identical financial assets or financial liabilities generated in an active market. An active
market is a market where trade volume is sufficient and objective price information is available due to the
fact that bid and ask price differences are small.
When trade volume of a financial instrument is low, when transaction prices within the market show large
differences among them, or when it cannot be concluded that a financial instrument is being traded within
an active market due to disclosures being extremely shallow, fair value is measured using valuation
techniques based on alternative market information or using internal valuation techniques based on general
and observable information obtained from objective sources. Market information includes maturity and
characteristics, duration, similar yield curve, and variability measurement of financial instruments of
similar nature. Fair value amount contains unique assumptions on each entity (the Group concluded that it
is using assumptions applied in valuing financial instruments in the market, or risk-adjusted assumptions in
case marketability does not exist).
The market approach and income approach, which are valuation techniques used to estimate the fair value
of financial instruments, both require significant judgment. Market approach measures fair value using
either a recent transaction price that includes the financial instrument, or observable information on
comparable firm or assets. Income approach measures fair value through discounting future cash flows with
a discount rate reflecting market expectations, and revenue, operating income, depreciation, capital
expenditures, income tax, working capital and estimated residual value of financial investments are being
considered when deriving future cash flows. Valuation techniques such as the above include estimates
based on the financial instruments’ complexity and usefulness of observable information in the market.
The valuation techniques used in the evaluation of financial instruments are explained below.
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a) Financial assets at FVTPL and Financial assets at FVTOCI
The fair value of equity securities included in financial assets at FVTPL and financial assets at FVTOCI
category is recognized in the statement of financial position at its available market price. Debt securities
traded in the over-the-counter market are generally recognized at an amount computed by an independent
appraiser. When the Group uses the fair value determined by independent appraisers, the Group usually
obtains three values from three different appraisers for each financial instrument, and selects the minimum
amount without making additional adjustments. For equity securities without marketability, the Group uses
the amount determined by the independent appraiser. The Group verifies the prices obtained from
appraisers in various ways, including the evaluation of independent appraisers’ competency, indirect
verification through comparison between appraisers’ price and other available market information, and
reperformed by employees who have knowledge of valuation models and assumptions that appraisers used.
b) Derivatives
The Group’s transactions involving derivatives such as futures and exchange traded options are measured at
market value. For exchange traded derivatives classified as level 2 in the fair value hierarchy, the fair value
is estimated using internal valuation techniques. If there are no publicly available market prices because
they are traded over-the-counter, fair value is measured through internal valuation techniques. When using
internal valuation techniques to derive fair value, the types of derivatives, base interest rate or
characteristics of prices, or stock market indices are considered. When variables used in the internal
valuation techniques are not observable information in the market, such variables may contain significant
estimates.
c) Adjustment of valuation amount
The Group is exposed to credit risk when a counterparty to a derivative contract does not perform its
contractual obligation, and the exposure amount is equal to the amount of derivative asset recognized in the
statement of financial position. When the Group earns income through valuation of derivatives, such
income is recognized as derivative asset in the statement of financial position. Some of the derivatives are
traded in the market, but most of the derivatives are measured at estimated fair value derived from internal
valuation models that use observable information in the market. As such, in order to estimate the fair value
there should be an adjustment made to incorporate counterparty’s credit risk, and credit risk adjustment is
being considered when valuing derivative assets such as over-the counter derivatives. The amount of
financial liabilities is also adjusted by the Group’s own credit risk when valuing them.
The amount of adjustment is derived from counterparty’s probability of default and loss given default. This
adjustment considers contractual matters that are designed to reduce the Group’s exposure to each
counterparty’s credit risk. When derivatives are under master netting arrangement, the exposure used in the
computation of credit risk adjustment is a net amount after adding/deducting cash collateral received (or
paid) from loss(or gain) position derivatives with the same counterparty.
6)
Expected credit losses on financial assets
The Group recognizes loss allowance on expected credit losses for the following assets:
- Financial assets at amortized cost
- Debt instruments measured at FVTOCI
- Contract assets as defined by K-IFRS 1115
Expected credit losses are weighted-average value of a range of possible results, considering the time value
of money, and are measured by incorporating information on current conditions and forecasts of future
economic conditions that are available without undue cost or effort.
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The methods to measure expected credit losses are classified into following three categories in accordance
with K-IFRS:
- General approach: Financial assets that does not belong to below two models and unused loan
commitments
- Simplified approach: When financial assets are either trade receivables, contract assets or lease receivables
- Credit impairment model: Purchased or originated credit-impaired financial assets
The measurement of loss allowance under general approach is differentiated depending on whether the
credit risk has increased significantly after initial recognition. That is, loss allowance is measured based on
12-month expected credit loss when the credit risk has not increased significantly after initial recognition,
while loss allowance is measured at lifetime expected credit loss when credit risk has increased
significantly. Lifetime is the expected remaining life of the financial instrument up to the maturity date of
the contract.
The measurement of loss allowance under simplified approach is always based on lifetime expected credit
loss, and loss allowance under credit impairment model is measured as the cumulative change in lifetime
expected credit loss since initial recognition.
a) Measurement of expected credit losses on financial asset at amortized cost
The expected credit losses on financial assets at amortized cost is measured by the difference between the
contractual cash flows during the period and the present value of expected cash flows. Expected cash
inflows are computed for individually significant financial assets in order to calculate expected credit
losses.
When financial assets that are not individually significant, they are included in a group of financial assets
with similar credit risk characteristics and expected credit losses of the group are calculated collectively.
Expected credit losses are deducted through loss allowance account, and when the financial asset is
determined to be uncollectible, the loss allowance is written off from the books along with the related
financial asset. When loan receivable previously written off is subsequently collected, the related loss
allowance is increased and changes in loss allowance are recognized in profit or loss.
b) Measurement of expected credit losses on financial asset at FVTOCI
The measurement method of expected credit loss is identical to financial asset at amortized cost, but
changes in the loss allowance is recognized in other comprehensive income. When financial assets at
FVTOCI is disposed or repaid, the related loss allowance is reclassified from other comprehensive income
to net income.
(10) Offsetting financial instruments
Financial assets and liabilities are presented as a net amount in the statements of financial position when the
Group has an enforceable legal right and an intention to settle on a net basis or to realize an asset and settle the
liability simultaneously.
(11) Investment properties
The Group classifies a property held to earn rentals and/or for capital appreciation as an investment property.
Investment properties are measured initially at cost, including transaction costs, less subsequent depreciation and
impairment.
Subsequent costs are included in the carrying amount of the asset or recognized as a separate asset if it is
probable that future economic benefits associated with the assets will flow into the Group and the cost of an asset
can be measured reliably, and the book value of a portion of an asset that are replaced by a subsequent
expenditure is removed from the books. Routine maintenance and repairs are expensed as incurred.
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While land is not depreciated, all other investment properties are depreciated based on the depreciation method
and useful lives of premises and equipment. The estimated useful lives, residual values and depreciation method
are reviewed at the end of each reporting period, and when it is deemed appropriate to change them, the effect of
any change is accounted for as a change in accounting estimates.
An investment property is derecognized from the consolidated financial statements on disposal or when it is
permanently withdrawn from use and no future economic benefits are expected even from its disposal. The gain
or loss on the derecognition of an investment property is calculated as the difference between the net disposal
proceeds and the carrying amount of the property and is recognized in profit or loss in the period of the
derecognition.
(12) Premises and equipment
Premises and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.
The cost of an item of premises and equipment is expenditure directly attributable to their purchase or
construction, which includes any cost directly attributable to bringing the asset to the location and condition
necessary for it to be capable of operating in the manner intended by management. It also includes the initial
estimate of costs of dismantling and removing the item and restoring the site on which it is located.
Subsequent costs are recognized in the carrying amount of an asset or as a separate asset (if appropriate) if it is
probable that future economic benefit associated with the assets will flow into the Group and the cost of an asset
can be measured reliably. Routine maintenance and repairs are expensed as incurred.
While land is not depreciated, for all other premises and equipment, depreciation is charged to net income on a
straight-line basis by applying the following estimated economic useful lives on the amount of cost or revalued
amount less residual value.
Buildings used for business purpose
Structures in leased office
Properties for business purpose
Right-of-use assets
Useful life
35 to 57 years
4 to 5 years
4 to 5 years
Useful lives of the same kind or similar other premises and
equipment
The Group reassesses the depreciation method, the estimated useful lives and residual values of premises and
equipment at the end of each reporting period. If changes in the estimates are deemed appropriate, the changes
are accounted for as a change in an accounting estimate. When there is an indicator of impairment and the
carrying amount of a premises and equipment item exceeds the estimated recoverable amount, the carrying
amount of such asset is reduced to the recoverable amount.
(13) Intangible assets and goodwill
The Group is recognizing intangible assets measured at the manufacturing cost or acquisition cost plus additional
incidental expenses less accumulated amortization and accumulated impairment losses. The Group’s intangible
asset are amortized over the following economic lives using the straight-line method. The estimated useful life
and amortization method are reviewed at the end of each reporting period. If changes in the estimates are deemed
appropriate, the changes are accounted for as a change in an accounting estimate.
Industrial property rights
Development costs
Software and others
Useful life
10 years
5 years
4 to 10 years
In addition, when an indicator that intangible assets are impaired is noted, and the carrying amount of the asset
exceeds the estimated recoverable amount of the asset, the carrying amount of the asset is reduced to its
recoverable amount.
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Goodwill acquired in a business combination is included in intangible assets. Goodwill is not amortized, but is
subject to an impairment test at the cash-generating unit level every year, and whenever there is an indicator that
goodwill is impaired.
Goodwill resulting from an acquisition of a business is carried at cost as established at the date of acquisition of
the business less accumulated impairment losses, if any.
Goodwill is allocated to each of the Group’s cash-generating unit (or groups of cash-generating units) that is
expected to benefit from the synergies of the combination. If the recoverable amount of the cash-generating unit
is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any
goodwill allocated to the unit and then to the other assets of the unit on a pro rata basis based on the carrying
amount of each asset in the unit. Any impairment loss for goodwill is recognized directly in profit or loss. An
impairment loss recognized for goodwill is not reversed in subsequent periods.
(14) Impairment of non-monetary assets
Intangible assets with indefinite useful lives or intangible assets that are not yet available for use are tested for
impairment annually, regardless of whether or not there is any indication of impairment. All other assets are
tested for impairment by estimating the recoverable amount when there is an objective indication that the
carrying amount may not be recoverable. Recoverable amount is the higher of value in use or net fair value, less
costs to sell. If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying
amount of the asset is reduced to its recoverable amount and such impairment loss is recognized immediately in
net income.
(15) Leases
As the Group applied IFRS 16 using the revised retrospective method, the comparative financial information has
not been prepared. The Group also applied K-IFRS 1017 and 2104. The accounting policies in accordance with
K-IFRS 1017 and 2104 are separately disclosed.
1) Accounting policy applied as of January 1, 2019.
The Group determines whether the agreement is a lease or includes a lease at the time of the agreement. In
exchange for consideration in the contract, if the control over the use of the identified asset is transferred
for a period of time, the contract is a lease or includes a lease. In determining whether a contract transfers
control of the use of the identified asset, the Group uses the definition of a lease in IFRS 16.
This accounting policy applies to contracts entered into as of January 1, 2019.
① The Group as a lessee
The Group recognizes the right-of-use asset and the lease liability at the commencement date of the lease.
The right-of-use asset is measured at cost, which comprises the amount of the initial measurement of the
lease liability, lease payments made at or before the commencement date(less any lease incentives
received), initial direct costs, and an estimate of costs to be incurred by the lessee in dismantling and
removing the underlying asset, restoring the site on which it is located.
The right-of-use asset is subsequently depreciated on a straight-line basis from the commencement of the
lease to the end of the lease term. However, if the lease transfers ownership of the underlying asset to the
lessee by the end of the lease term or if the cost of the right-of-use asset reflects that the lessee will exercise
a purchase option, the lessee depreciates the right-of-use asset same as a fixed asset from the
commencement date to the end of the useful life of the underlying asset. The right-of-use asset may be
reduced by an impairment of the underlying asset or adjusted by remeasurement of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at that
date. The lease payments are discounted using the interest rate implicit in the lease, if that cannot be readily
determined, the Group uses its incremental borrowing rate. The Group generally uses the incremental
borrowing rate.
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The lease payments included in the measurement of the lease liability comprise the following:
-
-
Fixed payments (including in-substance fixed payments)
Variable lease payments that depend on an index(or a rate), initially measured using the index or rate
as at the commencement date
Amounts expected to be payable by the lessee under residual value guarantees
The exercise price of a purchase option if the lessee is reasonably certain to exercise that option, lease
payments of the extended period if the lessee is reasonably certain to exercise extension option, and
payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option
to terminate the lease
-
-
The lease liability is subsequently increased be the interest expense recognized for the lease liability and
decreased by reflecting the payment of the lease payments. The lease liability is remeasured if the future
lease payments change depending on changes in the index(or a rate), changes in the expected amount to be
paid under the residual value guarantee, and changes in the assessment of whether the purchase or
extension option is reasonably certain to be exercised or not to exercise the terminate option.
When remeasuring a lease liability, the related right-of-use asset is adjusted and if the carrying amount of
the right-of-use asset decreases to zero, the remeasurement amount is recognized in profit or loss.
The Group applies its judgment when determining the lease term for some lease contracts that include the
extension option. The assessment of whether the Group is reasonably certain to exercise the option
significantly affects the lease term and therefore has a significant impact on the amount of lease liabilities
and the right-of-use asset.
In the statement of financial position, the Group classified the right-of-use assets that do not meet the
definition of investment property as ‘premises and equipment’ and the lease liabilities as ‘other financial
liabilities.’
The Group has chosen a practical expedient that does not recognize the right-of-use asset and lease
liabilities for short-term leases with a lease term less than 12 months and leases for which the underlying
asset is of low value. The Group recognizes the lease payments associated with those leases as an expense
on a straight-line basis over the lease term.
② The Group as a lessor
At the date of the agreement or the effective date of the modification containing the lease element, the
Group allocates the consideration of the contract to each lease element on the basis of its relative stand-
alone price.
As a lessor, the Group classifies its leases as either an operating lease or a finance lease at the
commencement date.
The Group subsequently judges whether the lease transfers substantially all the risks and rewards incidental
to ownership of an underlying asset. A lease is classified as a finance lease if it transfers substantially all
the risks and rewards incidental to ownership of an underlying asset, otherwise a lease is classified as an
operating lease.
If the agreement contains both lease and non-lease elements, the Group applies K-IFRS 1115 to allocate the
consideration of the contract.
The Group applies the derecognition and impairment provisions of K-IFRS 1109 to its net investment in the
lease. The Group also carries out regular review of the unguaranteed residual value used to calculate total
lease investment.
The Group recognizes lease payments from operating lease as income on a straight-line basis.
The accounting policy that the Group has applied as a lessor is not different from K-IFRS 1116.
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2) Accounting policy applied until January 1, 2019
The Group classifies a lease as a finance lease if it transfers substantially all the risks and rewards
incidental to ownership of an underlying asset to the lessee, and all lease contracts other than finance leases
are classified as operating leases.
① The Group as a lessee
In case of finance leases, the lesser amount of the present value of the minimum lease payments at the
commencement date of the lease term or the fair value of the leased asset are recognized as financial lease
assets and liabilities in the statement of financial position. Lease payments are allocated as interest expense
and repayment of the lease liability so that the same period interest rate is calculated for the balance of the
liability. Adjustment to the lease payments are accounted for as expenses during the period.
The operating lease payments are recognized as an expense on a straight-line basis if there is no other
systematic basis that is more representative of the pattern in which benefit from the use of underlying asset.
Adjustment lease payments from the operating leases are accounted for as expenses during the period in
which they are incurred.
② The Group as a lessor
The Group recognizes a finance lease receivable equal to the present value of the minimum lease and the
non-guaranteed residual value, which is the net investment of the finance lease. The accounting for
recognizing interest income by reporting period is carried out on a financial lease receivable after the
commencement date of the lease term by applying a method in which a certain interest rate of the Group’s
net investment in the lease is calculated.
The Group recognizes income from lease payments of operating lease on a straight line basis over the lease
term, and the direct costs of the lease incurred during the negotiation and contract phase of the operating
lease is added to the carrying value of the lease asset and recognized as an expense over the lease term on a
straight-line basis. Operating lease assets are included in other assets and are depreciated over their
economic useful life.
(16) Derivative instruments
Derivative instruments are classified as forwards, futures, options and swaps, depending on the types of
transactions and are classified at the point of transaction as either trading or hedging based on its purpose.
Derivatives are initially recognized at fair value at the date of contract and are subsequently measured at fair
value at the end of each reporting period. The resulting gain or loss is recognized in net income immediately
unless the derivative is designated or effective as a hedging instrument. If derivatives have been designated as
hedging instruments and if it is effective, the point of recognition of gain or loss depends on the characteristics of
hedging relationship.
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Derivatives that have positive (+) fair values are recognized as financial assets and those that have negative (-)
fair values are recognized as financial liabilities. Derivatives are not offset in the consolidated financial
statements unless they have legally enforceable right to set off or are intended to set off.
1) Embedded derivatives
Embedded derivatives are components of a hybrid financial instrument that includes a non-derivative host
contract. It has an effect of modifying part of cash flows of the hybrid financial instrument similar to an
independent derivative.
Embedded derivatives that are part of a hybrid contract of which the host contract is a financial asset within
the scope of K-IFRS 1109 is not separated. The classification is done by considering the hybrid contract as
a whole, and subsequent measurement is either at amortized cost or fair value.
If embedded derivatives are part of a hybrid contract of which the host contract is not a financial asset
within the scope of K-IFRS 1109 (e.g. financial liability), then these are treated as separate derivatives if
embedded derivatives meet the definition of a derivative, characteristics & risk of the embedded derivatives
are not closely related to that of host contract, and if the host contract is not measured at FVTPL.
2) Hedge accounting
The Group is applying K-IFRS 1109 in regard to hedge accounting. The Group is designating certain
derivatives as hedging instrument against fair value changes in relation to the interest rate risk, foreign
currency translation and interest rate risk, and foreign currency translation risk.
The Group is documenting the relationship between hedging instruments and hedged items at the
commencement of hedging in accordance with their purpose and strategy. Also, the Group documents at
the commencement and subsequent dates whether the hedging instrument effectively counters the changes
in fair value of hedged items. A hedging instrument is effective only when it meets all the following
criteria:
ㆍ When there is an economic relationship between the hedged items and hedging instruments.
ㆍ When the effect of credit risk is not stronger than the change in value due to the economic relationship
between the hedged items and hedging instruments.
ㆍ When the hedge ratio of hedging relationship is equal to the proportion of the number of items that the
group actually hedges and the number of hedging instruments that the Group actually uses to hedge the
number of hedged items.
When a hedging relationship no longer meets the hedging effectiveness requirements related to hedge ratio,
but when the purpose of risk management on designated hedging relationship is still maintained, the hedge
ratio of the hedging relationship is adjusted so that hedging relationship may meet the requirements again
(Hedge ratio readjustment).
The Group has designated derivatives as hedging instrument except for the portion on foreign currency
basis spread. The fair value change due to foreign currency basis spread is recognized in other
comprehensive income and is accumulated in equity. If the hedged item is related to transactions, the
accumulated other comprehensive income is reclassified to profit or loss when the hedged item affects the
profit or loss. However, when non-monetary items are subsequently recognized due to hedged items, the
accumulated equity is removed from the equity directly, and is included in the initial book value of the
recognized non-monetary items. Such transfers does not affect other comprehensive income. But if part or
all of accumulated equity is not expected to be recovered in the future periods, the amount not expected to
be recovered is immediately reclassified to profit or loss. If the hedged item is time-related, then the foreign
currency basis spread on the day the derivative is designated as a hedging instrument that is related to the
hedged item is reclassified to profit or loss over the term of the hedge.
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3) Fair value hedge
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Gain or loss arising from valid hedging instrument is recognized in profit or loss. However, when the
hedging instrument mitigates risks on equity instruments designated as financial assets at FVTOCI, related
gain or loss is recognized in other comprehensive income.
The book value of hedged items that are not measured in fair value is adjusted by the changes in fair value
arising from the hedged risk, with resulting gain or loss reflected in net income. In case of debt instruments
measured at FVTOCI, book value is an amount that is already adjusted to fair value and thus gain or loss
arising from the hedged risk is recognized in profit or loss instead of other comprehensive income without
adjustments in book value. When the hedged item is equity instruments measured at FVTOCI, the gain or
loss arising from hedged risk is retained at other comprehensive income in order to match the gain or loss
with hedging instruments.
When gains or losses arising from the hedged risk are recognized in profit or loss of the current term, they
are recognized as items related to the hedged items.
Hedge accounting ceases to apply only when hedging relationship (or part of it) does not meet the
requirements of hedge accounting (even after hedging relationship readjustment, if applicable). This
treatment holds in case of lapse, disposal, expiry and exercise of hedging instruments, and this cease of
treatment applies prospectively. The fair value adjustments made to book value of hedged item due to
hedged risk is amortized from the date of discontinuance of hedge accounting and is recognized in profit or
loss.
4) Cash flow hedge
The Group recognizes the effective portion of changes in the fair value of derivatives and other valid
hedging instruments that are designated and qualified as cash flow hedges in other comprehensive income
to the extent of cumulative fair value changes of the hedged item from the starting date of hedge accounting
and it is cumulated in the cash flow hedge reserve. The gain or loss relating to the ineffective portion is
recognized immediately in net income.
Amounts previously recognized in other comprehensive income and accumulated in equity are reclassified
to net income when the hedged item affects net income. However, when non-monetary assets or liabilities
are subsequently recognized due to expected transactions involving hedged items, the valuation gain or loss
accumulated in the equity as other comprehensive income is removed from the equity and included in the
initial book value of the recognized non-monetary assets or liabilities. Such transfers does not affect other
comprehensive income. Also, if the cash flow hedge reserve is loss and accumulated other comprehensive
income is a loss and part or all of the losses are not expected to be recovered in the future periods, the said
amount is immediately reclassified to profit or loss.
Hedge accounting ceases to apply only when hedging relationship (or part of it) does not meet the
requirements of hedge accounting (even after hedging relationship readjustment, if applicable). This
treatment holds in case of lapse, disposal, expiry and exercise of hedging instruments, and this cease of
treatment applies prospectively. At the point of cessation of cash flow hedge, the valuation gain or loss
recognized as accumulated other comprehensive income continues to be recognized as equity, and is
reclassified to profit or loss when the expected transaction is ultimately recognized as profit or loss.
However, when transactions are no longer expected to occur, the valuation gain or loss of hedging
instrument recognized as accumulated other comprehensive income is immediately reclassified to profit or
loss.
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(17) Assets (or disposal group) held for sale
The Group classifies a non-current asset (or disposal group) as held for sale if its carrying amount will be
recovered principally through a sale transaction rather than through continuing use. Non-current assets (and
disposal groups) classified as held for sale are measured at the lower of their previous carrying amount and fair
value less costs to sell.
(18) Provisions
Provisions are recognized if it has present or contractual obligations as a result of the past event, it is probable
that an outflow of resources will be required to settle the obligation and the amount of the obligation is reliably
estimated. A provision is not recognized for the future operating losses.
The Group recognizes provisions related to the payment guarantees, loan commitment and litigations. Under the
terms of lease agreement, the cost incurred by the Group to recover the leased asset to its original state are
recognized as provisions at the commencement of the lease or during a specific period in which the obligation is
incurred as a result of the using the asset. The provisions are measured as the best estimate of the expenditure
required to recover the asset, which is regularly reviewed and sated to the new situation.
Where there are a number of similar obligations, the probability that an outflow will be required in settlement is
determined by considering the obligations as a whole. Although the likelihood of outflow for any one item may
be small, if it is probable that some outflow of resources will be needed to settle the obligations as a whole, a
provision is recognized.
At the end of each reporting period, the remaining provision balance is reviewed an assessed to determine if the
current best estimate is being recognized.
(19) Equity instruments issued by the Group
1) Capital and compound financial instruments
The Group classifies a financial instrument that it issues as a financial liability or an equity instrument in
accordance with the substance of the contractual arrangement. A financial liability is a contractual
obligation to deliver cash or another financial asset to another entity. An equity instrument is any contract
that evidences a residual interest in the assets of an entity after deducting all of its liabilities. The compound
financial instruments are financial instruments where it is neither a financial liability nor an equity
instrument because it was designed to contain both equity and debt elements.
If the Group reacquires its own equity instruments, the consideration paid including the direct transaction
costs (net of tax expense) are presented as a deduction from total equity until such instruments are retired or
reissued. When these instruments are reissued, the consideration received (net of direct transaction costs) is
included in the shareholder’s equity.
2) Hybrid securities
The Group classifies hybrid securities that have the unconditional right to avoid contractual obligations,
such as to deliver cash or other financial assets in relation to financial instruments into equity instruments
and presents as part of equity. Meanwhile, hybrid securities issued by subsidiaries of the group are
classified as non-controlling interests according to the criteria, and the distribution paid is treated as net
profit attributable to non-controlling interests in the consolidated comprehensive income statement.
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(20) Financial guarantee contracts
A financial guarantee contract is a contract where the issuer must pay a certain amount of money in order to
compensate losses suffered by the creditor when debtor defaults on a debt instrument in accordance with original
or modified contractual terms.
A financial guarantee is initially measured at fair value and is subsequently measured at the higher of the
amounts below unless it is designated to be measured at FVTPL or when it arises from disposal of an asset.
- Loss allowance in accordance with K-IFRS 1109
- Initial book value less accumulated profit measured in accordance with K-IFRS 1115
(21) Employee benefits and pensions
The Group recognizes the undiscounted amount of short-term employee benefits expected to be paid in exchange
for the services rendered by the employees. Also, the Group recognizes expenses and liabilities in the case of
accumulating compensated absences when the employees render services that entitle their right to future
compensated absences. Similarly, the Group recognizes expenses and liabilities for customary profit distribution
or bonuses when the employees render services, even though the Group does not have legal obligation to do so
because it can be construed as constructive obligation.
The Group is operating defined contribution plans and defined benefit plans. Contributions to defined
contribution plans are recognized as an expense when employees have rendered services entitling them to
receive the benefits. For defined benefit plans, the defined benefit liability is calculated through an actuarial
assessment using the projected unit credit method every end of the reporting period, conducted by a professional
actuaries. Remeasurement, comprising actuarial gains and losses, the return on plan assets (excluding the amount
included in net interest from net defined benefit liability (asset)), and the effect of the changes to the asset ceiling
is reflected immediately in the separate statement of financial position with a charge or credit recognized in other
comprehensive income in the period in which they occur.
Remeasurement recognized in the consolidated statement of comprehensive income is not reclassified to profit
or loss in the subsequent periods. Past service cost is recognized in profit or loss in the period of a plan
amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net
defined benefit liability or asset. Defined benefit costs are composed of service cost (including current service
cost and past service cost, as well as gains and losses on settlements), net interest expense (income) and
remeasurement.
The Group presents the service cost and net interest expense (income) components in profit or loss, and the
remeasurement component in other comprehensive income. Curtailment gains and losses are accounted for as
past service costs.
The retirement benefit obligation recognized in the consolidated statement of financial position represents the
actual deficit or surplus in the Group’s defined benefit plans. Any surplus resulting from this calculation is
recognized as an asset limited to the present value of any economic benefits available in the form of refunds
from the plans or reductions in future contributions to the plans.
Liabilities for termination benefits are recognized at the earlier of either the date when the Group is no longer
able to cancel its proposal for termination benefits or the date when the Group has recognized the cost of
restructuring that accompanies the payment of termination benefits.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 39 -
217
(22) Income taxes
Income tax expense is composed of current tax and deferred tax. That is, income tax expense is composed of
taxes payable or refundable during the period and deferred taxes calculated by applying asset-liability method to
taxable and deductible temporary differences arising from operating loss and tax credit carryforwards.
Temporary differences are the differences between the carrying values of assets and liabilities for financial
reporting purposes and their tax bases. Deferred income tax benefit or expense is recognized for the change in
deferred tax assets or liabilities. Deferred tax assets and liabilities are measured as of the reporting date using the
enacted or substantively enacted tax rates expected to apply in the period in which the liability is settled or asset
is realized. Deferred tax assets, including the carryforwards of unused tax losses, are recognized to the extent it is
probable that the deferred tax assets will be realized.
Deferred income tax assets and liabilities are offset if, and only if, the Group has a legally enforceable right to
offset current tax assets against current tax liabilities, and the deferred tax assets and liabilities relate to income
taxes levied by the same taxation authority or when the entity intends to settle current tax liabilities and assets on
a net basis with different taxable entities.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the
extent it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred liabilities are not recognized if the temporary difference arises from the initial recognition of goodwill.
Deferred tax assets or liabilities are not recognized if they arise from the initial recognition (other than in a
business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the
accounting profit.
Current and deferred taxes are recognized in profit or loss, except when they relate to items that are recognized
in other comprehensive income or directly in equity or when it arises from business combination.
The tax uncertainty arises from the compensation claim filed by the Group, and refund litigation for the amount
of tax levied by the tax authority due to differences in tax law analysis. In response, the Group paid taxes in
accordance with K-IFRS 2123 due to the tax authority’s claim, but recognized as a corporate tax asset if it is
highly probable of a refund in the future.
(23) Criteria of calculating earnings per share (“EPS”)
Basic EPS is a calculation of net income per each common stock. It is calculated by dividing net income
attributable to ordinary shareholders by the weighted-average number of common shares outstanding. Diluted
EPS is calculated by adjusting the earnings and number of shares for the effects of all dilutive potential common
shares.
(24) Share-based payment
For cash-settled share-based payment transactions that provide cash in return for the goods or services received,
the Group measures the goods or services received, and the corresponding liability at the fair value and recognizes
as employee benefit expenses and liabilities during the vesting period. The fair value of the liability is remeasured
at the end of each reporting period and the settlement date until the liability is settled, and changes in fair value
are recognized as employee benefits.
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3.
SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS
The significant accounting estimates and assumptions are continuously being evaluated based on numerous
factors including historical experiences and expectations of future events considered to be reasonably possible.
Actual results can differ from those estimates based on such definitions. The accounting estimates and
assumptions that contain significant risk of materially changing current book values of assets and liabilities in
the next accounting periods are as follows:
(1) Income taxes
The Group has recognized current and deferred taxes based on best estimates of expected future income tax
effect arising from the Group’s operations until the end of the current reporting period. However, actual tax
payment may not be identical to the related assets and/or liabilities already recognized, and these differences
may affect current taxes and deferred tax assets/liabilities at the time when income tax effects are finalized.
Deferred tax assets relating to tax losses carried forward and deductible temporary differences are recognized
only to the extent that it is probable that future taxable profit will be available against which the tax losses
carried forward and the deductible temporary differences can be utilized. In this case the Group’s evaluation
considers various factors such as estimated future taxable profit based on forecasted operating results, which are
based on historical financial performance. The Group is reviewing the book value of deferred tax assets every
end of the reporting period and in the event that the possibility of earning future taxable income changes, the
deferred tax assets are adjusted up to taxable income sufficient to use deductible temporary differences.
(2) Valuation of financial instruments
Financial assets at FVTPL and FVTOCI are recognized in the consolidated financial statements at fair value. All
derivatives are measured at fair value. Valuation techniques are required in order to determine fair values of
financial instruments where observable market prices do not exist. Financial instruments that are not actively
traded and have low price transparency will have less objective fair value and require broad judgment in
liquidity, concentration, uncertainty in market factors and assumption in price determination and other risks.
As described in Note 2-(9)-5), ‘Fair value of financial instruments’, when valuation techniques are used to
determine the fair value of a financial instrument, various general and internally developed techniques are used,
and various types of assumptions and variables are incorporated during the process.
(3) Impairment of financial instruments
K-IFRS 1109 requires entities to measure loss allowance equal to 12-month expected credit losses or lifetime
expected credit losses after classifying financial assets into one of the three stages, which depends on the degree
of increase in credit risk after their initial recognition.
Stage 1
Allowance for
expected credit
losses
Credit risk has not significantly increased
since initial recognition (*)
Expected 12-month credit losses:
Expected credit losses due to possible
defaults on financial instruments within a
12-month period from the year-end.
Stage 3
Stage 2
Credit risk has significantly
increased since initial
recognition
Expected lifetime credit losses:
Expected credit losses from all possible
defaults during the expected lifetime of the
financial instruments.
Credit has
been impaired
(*) Credit risk may be considered not to have been significantly increased when credit risk is low at year-end.
The Group has estimated the allowance for credit losses based on reasonable and supportable information that
was available without undue cost or effort at the reporting date about past events, current conditions and
forecasts of future economic conditions.
Probability of default (PD) and Loss given default (LGD) for each category of financial asset is being calculated
by considering factors such as debtor type, credit rating and portfolio. The estimates are regularly being
reviewed in order to reduce discrepancies with actual losses.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 41 -
219
In measuring the expected credit losses, the Group is using reasonable and supportable macroeconomic
indicators such as economic growth rates, interest rates, market index rates, etc., in order to forecast future
economic conditions.
The Group is conducting the following procedures to estimate and apply future economic forecast information.
- Development of prediction models by analyzing the correlation between default rates of corporate and retail
exposures per year and macroeconomic indicators
- Calculation of predicted default rate incorporating future economic forecasts by applying estimated
macroeconomic indicators provided by verified institutions such as Bank of Korea and National Assembly
Budget Office to the prediction model developed.
At the end of every reporting period, the Group evaluates whether credit risk reflecting forward-looking
information has significantly been increased since the date of initial recognition. When evaluating whether credit
risk has significantly been increased, the changes in the probability of default over the financial instrument’s
remaining life is used instead of changes in the amount of expected credit losses. The Group performs the above
evaluation with distinctions made to corporate and retail exposures, and indicators of significant increase in
credit risk are as follows:
Corporate Exposures
Asset quality level ‘Precautionary’ or lower
More than 30 days past due
‘Warning’ level in early warning system
Debtor experiencing financial difficulties
(Capital impairment, Adverse opinion or Disclaimer of
opinion by external auditors)
Significant decrease in credit rating (*)
Retail Exposures
Asset quality level ‘Precautionary’ or lower
More than 30 days past due
Significant decrease in credit rating(*)
(*) Determining whether there has been a significant decrease in the credit rating of corporate and retail exposures
applies only to credit ratings that are measured through 12-month expected credit loss. The Woori Bank, which is
an important subsidiary of the Group, has applied the above indicators of significant decrease in credit rating since
initial recognition as follows, and the estimation method is regularly being monitored.
Corporate
Retail
Credit rating
AAA ~ A+
A- ~ BBB
BBB- ~ BB+
BB ~ BB-
1 ~ 3
4 ~ 5
6 ~ 10
Significant increased indicator of the credit rating
More than or equal to 4 steps
More than or equal to 3 steps
More than or equal to 2 steps
More than or equal to 1 step
More than or equal to 3 steps
More than or equal to 2 steps
More than or equal to 1 step
The Group sees no significant increase in credit risk after initial recognition for debt securities, etc. with a credit
rating of A + or higher, which are deemed to have low credit risk at the end of the reporting period
The Group concludes that credit is impaired when financial assets are under conditions stated below:
- When principal of loan is overdue for 90 days or longer due to significant deterioration in credit
- For loans overdue for less than 90 days, when it is determined that not even a portion of the loan will be
recovered unless claim actions such as disposal of collaterals are taken
- When other objective indicators of impairment has been noted for the financial asset.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 220
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The Group determines which loan is subject to write-off in accordance with internal guidelines, and writes off
loan receivables when it is determined that the loans are practically irrecoverable. For example, loans are
practically irrecoverable when application is made for rehabilitation under the Debtor Rehabilitation and
Bankruptcy Act and loans are confirmed as irrecoverable by the court’s decision to waive debtor’s obligation, or
when it is impossible to recover the loan amount through legal means such as auctioning of debtor’s assets or
through any other means of recovery available. Notwithstanding the write-off, the Group may still exercise its
right of collection after the asset has been written off in accordance with its collection policies.
(4) Defined benefit plan
The Group operates a defined benefit pension plan. Defined benefit obligation is calculated at every end of the
reporting period by performing actuarial valuation, and estimation of assumptions such as discount rate,
expected wage growth rate and mortality rate is required to perform such actuarial valuation. The defined benefit
plan, due to its long-term nature, contains significant uncertainties in its estimates.
4. RISK MANAGEMENT
The Group’s operating activity is exposed to various financial risks. The Group is required to analyze and assess
the level of complex risks, and determine the permissible level of risks and manage such risks. The Group’s risk
management procedures have been established to improve the quality of assets for holding or investment
purposes by making decisions as how to avoid or mitigate risks through the identification of the source of the
potential risks and their impact.
The Group has established an approach to manage the acceptable level of risks and reduce the excessive risks in
financial instruments in order to maximize the profit given risks present, for which the Group has implemented
processes for risk identification, assessment, control, and monitoring and reporting.
The risk is managed by the risk management department in accordance with the Group’s risk management
policy. The Risk Management Committee makes decisions on the risk strategies such as the allocation of risk
capital and the establishment of acceptable level of risk.
(1) Credit risk
Credit risk represents the possibility of financial losses incurred when the counterparty fails to fulfill its
contractual obligations. The goal of credit risk management is to maintain the Group’s credit risk exposure to a
permissible degree and to optimize its rate of return considering such credit risk.
1) Credit risk management
The Group considers the probability of failure in performing the obligation of its counterparties, credit
exposure to the counterparty, the related default risk and the rate of default loss. The Group uses the credit
rating model to assess the possibility of counterparty’s default risk; and when assessing the obligor’s credit
grade, the Group utilizes credit grades derived using statistical methods.
In order to manage credit risk limit, the Group establishes the appropriate credit line per obligor, company
or industry. It monitors obligor’s credit line, total exposures and loan portfolios when approving the loan.
The Group mitigates credit risk resulting from the obligor’s credit condition by using financial and physical
collateral, guarantees, netting agreements and credit derivatives. The Group has adopted the entrapment
method to mitigate its credit risk. Credit risk mitigation is reflected in qualifying financial collateral, trade
receivables, guarantees, residential and commercial real estate and other collaterals. The Group regularly
performs a revaluation of collateral reflecting such credit risk mitigation.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 43 -
221
2) Maximum exposure to credit risk
The Group’s maximum exposure to credit risk shows the uncertainties related to the maximum possible
variation of financial assets’ net value as a result of changes in the specific risk factors, prior to the
consideration of collaterals that are recorded at net book value after allowances and other credit
enhancements. However, the maximum exposure is the fair value amount (recorded on the books) for
derivatives, maximum contractual obligation for payment guarantees and unused amount of commitments
for loan commitment.
The maximum exposure to credit risk is as follows (Unit: Korean Won in millions):
Loans and other
Korean treasury and government
December 31, 2019
December 31, 2018
financial assets at
amortized cost
Financial assets at
FVTPL (*)
Financial assets at
FVTOCI
Securities at
agencies
Banks
Corporates
Consumers
Sub-total
Deposit
Debt securities
Loans
Derivative assets
Sub-total
14,797,040
18,597,206
101,041,110
159,282,337
293,717,693
27,901
2,337,085
212,473
2,921,903
5,499,362
13,547,154
22,283,842
96,627,671
149,998,911
282,457,578
26,935
1,824,155
385,450
2,026,079
4,262,619
Debt securities
26,795,161
17,112,249
amortized cost
Derivative assets
Debt securities
Derivative assets (Designated for
Off-balance
accounts
hedging)
Guarantees
Unused loan commitments
Sub-total
Total
20,320,539
22,932,559
121,131
12,618,917
103,651,674
116,270,591
462,724,477
35,503
12,666,417
97,796,704
110,463,121
437,263,629
(*) Puttable financial instruments are not included
a) Credit risk exposure by geographical areas
The following tables analyze credit risk exposure by geographical areas (Unit: Korean Won in millions):
Loans and other financial
assets at amortized cost
Securities at amortized cost
Financial assets at FVTPL
Financial assets at FVTOCI
Derivative assets (Designated
for hedging)
Off-balance accounts
Total
Korea
China
December 31, 2019
UK
Japan
USA
Others (*)
Total
268,316,454
20,104,604
5,488,229
24,553,655
5,108,144
-
10,409
332,319
5,077,666
66,747
-
144,601
1,844,374 1,172,209
-
724
2
-
-
102,311
12,198,846
149,188
-
1,662,273
293,717,693
20,320,539
5,499,362
26,795,161
121,131
112,602,603
431,186,676
-
1,211,857
6,662,729
-
387,795
5,676,809
-
78,850
-
46,662
2,025,535 1,219,597
-
1,942,824
15,953,131
121,131
116,270,591
462,724,477
(*) Others consist of financial assets in Indonesia, Hong Kong, Singapore, and other countries.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 222
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Korea
China
December 31, 2018
UK
Japan
USA
Others (*)
Total
Loans and other financial
assets at amortized cost
Securities at amortized cost
Financial assets at FVTPL
Financial assets at FVTOCI
Derivative assets (Designated
for hedging)
Off-balance accounts
Total
261,547,407
22,757,048
4,261,110
15,697,518
4,592,153
-
1,243
261,085
4,597,119
70,578
-
103,755
1,526,532
-
-
24,960
893,354
-
266
2,247
9,301,013
104,933
-
1,022,684
282,457,578
22,932,559
4,262,619
17,112,249
35,503
107,632,858
411,931,444
-
801,978
5,656,459
-
343,323
5,114,775
-
136,727
1,688,219
-
35,000
930,867
-
1,513,235
11,941,865
35,503
110,463,121
437,263,629
(*) Others consist of financial assets in Indonesia, Hong Kong, Singapore, and other countries.
b) Credit risk exposure by industries
The following tables analyze credit risk exposure by industries, which are service, manufacturing, finance
and insurance, construction, individuals and others in accordance with the Korea Standard Industrial
Classification Code (Unit: Korean Won in millions):
Service
Manufacturing
Finance and
insurance
Construction
Individuals
Others
Total
December 31, 2019
Loans and other financial
assets at amortized cost
Securities at amortized cost
Financial assets at FVTPL
Financial assets at FVTOCI
Derivative assets
(Designated for hedging)
Off-balance accounts
Total
51,233,088
8,545,838
162,780
85,609
-
17,813,366
77,840,681
32,983,972
-
128,666
139,098
36,141,770
10,979,001
4,084,698
18,968,456
3,291,001
364,591
39,193
10,047
155,120,055
-
15,430
9,241
14,947,807
431,109
1,068,595
7,582,710
293,717,693
20,320,539
5,499,362
26,795,161
-
23,841,881
57,093,617
121,131
10,015,897
80,310,953
-
-
4,161,139
53,335,209
7,865,971 208,479,935
-
7,103,099
31,133,320
121,131
116,270,591
462,724,477
Service
Manufacturing
Finance and
insurance
Construction
Individuals
Others
Total
December 31, 2018
Loans and other financial
assets at amortized cost
Securities at amortized cost
Financial assets at FVTPL
Financial assets at FVTOCI
Derivative assets
(Designated for hedging)
Off-balance accounts
Total
48,319,987
1,157,512
120,659
382,409
-
17,645,104
67,625,671
34,972,072
-
153,159
109,749
40,338,823
13,414,743
3,117,845
13,017,646
3,295,967
527,847
16,118
224,665
145,715,074
-
7,614
5,535
9,815,655
7,832,457
847,224
3,372,245
282,457,578
22,932,559
4,262,619
17,112,249
-
22,300,388
57,535,368
35,503
9,654,685
79,579,245
-
4,146,708
8,211,305
-
49,948,865
195,677,088
-
6,767,371
28,634,952
35,503
110,463,121
437,263,629
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 45 -
223
3) Credit risk exposure
a) Financial assets
The maximum exposure to credit risk by asset quality, except for financial assets at FVTPL and derivative
asset (Designated for hedging) is as follows (Unit: Korean Won in millions):
December 31, 2019
Stage 1
Stage 2
Above
appropriate
credit rating
(*1)
Less than a
limited
credit rating
(*3)
Above
appropriate
credit
rating (*2)
Less than a
limited credit
rating
(*3)
Stage 3
Total
Loss
allowance
Total, net
Loans and other financial
assets at amortized cost
Korean treasury and
government agencies
Banks
Corporates
General business
Small- and medium-
sized enterprise
Project financing and
others
Consumers
Securities at amortized cost
Financial assets at FVTOCI
(*4)
Total
255,709,205
19,823,451
8,712,860
9,625,024
1,504,172
295,374,712
(1,657,019)
293,717,693
14,789,933
18,336,664
82,286,304
45,769,233
10,390
109,667
15,201,687
6,191,625
-
150,318
485,469
441,089
-
-
3,267,311
1,620,761
1
21,907
792,375
544,238
14,800,324
18,618,556
102,033,146
54,566,946
(3,284)
(21,350)
(992,036)
(678,237)
14,797,040
18,597,206
101,041,110
53,888,709
32,180,551
8,507,800
44,380
1,586,865
230,901
42,550,497
(287,027)
42,263,470
4,336,520
140,296,304
20,326,050
502,262
4,501,707
-
-
8,077,073
-
59,685
6,357,713
-
17,236
689,889
-
4,915,703
159,922,686
20,326,050
(26,772)
(640,349)
(5,511)
4,888,931
159,282,337
20,320,539
26,684,601
302,719,856
110,560
19,934,011
-
8,712,860
-
9,625,024
-
1,504,172
26,795,161
342,495,923
(8,569)
(1,671,099)
26,795,161
340,833,393
Loans and other financial assets at amortized cost
Korean treasury and government agencies
Banks
Corporates
General business
Small- and medium-sized enterprise
Project financing and others
Consumers
Securities at amortized cost
Financial assets at FVTOCI (*4)
Total
Stage1
169,438,539
-
612,200
55,602,818
22,291,348
31,517,538
1,793,932
113,223,521
-
-
169,438,539
December 31, 2019
Collateral value
Stage2
14,451,806
-
2,028
2,335,496
1,023,766
1,311,730
-
12,114,282
-
-
14,451,806
Stage3
692,139
-
-
394,860
240,771
145,061
9,028
297,279
-
-
692,139
Total
184,582,484
-
614,228
58,333,174
23,555,885
32,974,329
1,802,960
125,635,082
-
-
184,582,484
(*1) Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6.
(*2) Credit grade of corporates are A- ~ BBB, and consumers are grades 1 ~ 6.
(*3) Credit grade of corporates are BBB- ~ C, and consumers are grades 7 ~ 10.
(*4) Financial assets at FVTOCI has been disclosed as the amount before deducting loss allowance because loss
allowance does not reduce the carrying amount.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 224
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December 31, 2018
Stage 1
Stage 2
Above
appropriate
credit rating
(*1)
Less than a
limited
credit rating
(*3)
Above
appropriate
credit
rating (*2)
Less than a
limited credit
rating
(*3)
Stage 3
Total
Loss
allowance
Total, net
Loans and other financial
assets at amortized cost
Korean treasury and
government agencies
Banks
Corporates
General business
Small- and medium-
sized enterprise
Project financing and
others
Consumers
Securities at amortized cost
Financial assets at FVTOCI
(*4)
Total
252,921,186
17,624,416
6,330,382
5,739,850
1,693,148
284,308,982
(1,851,404)
282,457,578
13,549,305
22,163,951
77,160,502
43,173,952
1,009
105,583
15,550,301
6,474,057
1
27,777
655,907
526,303
-
-
3,424,215
1,723,704
-
14,307
1,034,030
716,722
13,550,315
22,311,618
97,824,955
52,614,738
(3,161)
(27,776)
(1,197,284)
(817,002)
13,547,154
22,283,842
96,627,671
51,797,736
29,510,917
8,527,542
107,998
1,547,761
277,825
39,972,043
(335,469)
39,636,574
4,475,633
140,047,428
22,939,039
548,702
1,967,523
-
21,606
5,646,697
195
152,750
2,315,635
-
39,483
644,811
250
5,238,174
150,622,094
22,939,484
(44,813)
(623,183)
(6,925)
5,193,361
149,998,911
22,932,559
16,940,654
292,800,879
146,442
17,770,858
25,153
6,355,730
-
5,739,850
-
1,693,398
17,112,249
324,360,715
(6,177)
(1,864,506)
17,112,249
322,502,386
Loans and other financial assets at amortized cost
Korean treasury and government agencies
Banks
Corporates
General business
Small- and medium-sized enterprise
Project financing and others
Consumers
Securities at amortized cost
Financial assets at FVTOCI (*4)
Total
Stage1
163,329,105
11,600
361,024
51,595,949
19,907,948
29,780,716
1,907,285
111,360,532
-
-
163,329,105
December 31, 2018
Collateral value
Stage2
Stage3
8,836,440
-
3,334
2,509,620
1,167,993
1,291,222
50,405
6,323,486
-
-
8,836,440
698,593
-
-
426,325
241,651
184,674
-
272,268
-
-
698,593
Total
172,864,138
11,600
364,358
54,531,894
21,317,592
31,256,612
1,957,690
117,956,286
-
-
172,864,138
(*1) Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6.
(*2) Credit grade of corporates are A- ~ BBB, and consumers are grades 1 ~ 6.
(*3) Credit grade of corporates are BBB- ~ C, and consumers are grades 7 ~ 10.
(*4) Financial assets at FVTOCI has been disclosed as the amount before deducting loss allowance because loss
allowance does not reduce the carrying amount.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 47 -
225
b) Guarantees and loan commitments
The credit quality of the guarantees and loan commitments as of December 31, 2019 and 2018 are as
follows (Unit: Korean Won in millions):
Stage 1
December 31, 2019
Stage 2
Above
appropriate
credit rating
(*1)
Less than a
limited credit
rating
(*3)
Above
appropriate
credit rating
(*2)
Less than a
limited
credit rating
(*3)
Stage3
Total
10,952,917
1,333,561
355
223,657
108,427
12,618,917
Financial assets
Off-balance
accounts
Guarantees
Loan
Commitments
Total
97,854,790
108,807,707
3,479,295
4,812,856
1,388,136
1,388,491
906,033
1,129,690
23,420
131,847
103,651,674
116,270,591
(*1) Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6.
(*2) Credit grade of corporates are A- ~ BBB, and consumers are grades 1 ~ 6.
(*3) Credit grade of corporate are BBB- ~ C, and consumers are grades 7 ~ 10.
Stage 1
December 31, 2018
Stage 2
Above
appropriate
credit rating
(*1)
Less than a
limited credit
rating
(*3)
Above
appropriate
credit rating
(*2)
Less than a
limited
credit rating
(*3)
Stage3
Total
11,212,772
1,063,551
7,147
261,599
121,348
12,666,417
Financial assets
Off-balance
accounts
Guarantees
Loan
commitments
Total
91,734,567
102,947,339
3,632,586
4,696,137
1,529,330
1,536,477
880,518
1,142,117
19,703
141,051
97,796,704
110,463,121
(*1) Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6.
(*2) Credit grade of corporates are A- ~ BBB, and consumers are grades 1 ~ 6.
(*3) Credit grade of corporate are BBB- ~ C, and consumers are grades 7 ~ 10.
4) Collateral and other credit enhancements
During the current period, there have been no significant changes in the value of collateral or other credit
enhancements held by the Group and there have been no significant changes in collateral or other credit
enhancements due to changes in the collateral policy of the Group. As of December 31, 2019, there are no
financial assets that do not recognize the allowance for losses just because financial assets have collateral.
5) For the financial assets that record loss allowance as total expected credit loss, the amortized cost before
the change in contractual cash flows is 18,735 million Won, and the net loss due to the change is 82
million Won.
6) As the Group manages receivables that have not lost the right of claim to the debtor for the grounds of
incomplete statute limitation and uncollected receivables under the related laws as receivable charge-
offs, the balance as of December 31, 2019 and 2018 are 9,667,169 million Won and 9,578,796 million
Won.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
226
(2) Market risk
- 48 -
Market risk is the possible risk of loss arising from trading position and non-trading position as a result of the
volatility of market factors such as interest rates, stock prices and foreign exchange rates.
1) Market risk management
Market risk management refers to the process of making and implementing decisions for the avoidance,
acceptance or mitigation of risks by identifying the underlying source of the risks and measuring its level,
and evaluating the appropriateness of the level of accepted market risks.
a) Trading activities
The Group uses both a standard-based and an internal model-based approach to measure market risk. The
standard-based approach is used to calculate individual market risk of owned capital while the internal
model-based approach is used to calculate general capital market risk and managing internal risk. The
Value at Risk (VaR) methodology is used to manage and measure market risk.
Woori Bank, a subsidiary of the Group, uses the internal model approved by the Financial Supervisory
Service to measure the VaR using the Historical Simulation Method based on a 99% confidence level and a
10-day retention period, and calculates the required capital risk for calculating the BIS ratio. For internal
management purposes, limit management is performed on a daily basis measuring VaR based on a 99%
confidence and 1 day retention period. In addition, Woori Bank perform a daily verification that compares
VaR measurement and profit and loss to verify the suitability of the model.
The minimum, maximum and average VaR of the Group for the year ended December 31, 2019 and 2018,
respectively, and the VaR of the Group as of December 31, 2019 and 2018, respectively, are as follows
(Unit: Korean Won in millions):
Risk factor
Interest rate
Stock price
Foreign currencies
Commodity price
Diversification
Total VaR(*)
December
31, 2019
5,052
3,730
5,028
-
(6,233)
7,577
For the year ended
December 31, 2019
Average Maximum Minimum
1,176
5,725
1,146
5,935
4,395
6,469
-
32
(2,339)
(9,229)
4,378
8,932
3,406
3,203
5,033
1
(5,127)
6,516
December
31, 2018
3,107
2,353
4,972
-
(4,445)
5,987
For the year ended
December 31, 2018
Average Maximum Minimum
1,730
1,138
3,439
-
(1,815)
4,492
3,702
2,669
4,678
3
(4,869)
6,183
5,528
5,081
6,136
24
(8,155)
8,614
(*) VaR (Value at Risk): Retention period of 1 day, Maximum expected losses under 99% level of confidence.
b) Non-trading activities
For non-trading sectors of the bank, consolidated trusts and subsidiaries of the Bank, the risk is managed
and measured by △NII(change in Net Interest Income) and △EVE(change in Economic Value of Equity)
through NII(Net Interest Income) and NPV(Net Present Value) simulation, and for the remaining
subsidiaries, the risk is managed and measured with interest rate EaR(Earning at Risk, maximum of the
expected change for profit or loss) and interest rate VaR that are in accordance with BIS Framework.
NII is primarily an indicator of changes in profit from short-term changes in interest rates and is measured
by deducting the interest expenses on the liability from the interest income from the asset. NPV is primarily
an indicator of the risk of an economic value perspective resulting from unfavorable changes in interest
rates and is measured by subtracting the present value of the liability from the present value of the asset.
△NII represents a change in net interest income that may occur over a certain period (e.g., 1 year) due to
unfavorable changes in interest rates, and △EVE indicates the economic value changes in equity capital
that could be caused by changes in interest rates affecting the present value of asset, liabilities, and others.
The interest rate EaR represents the maximum amount of decrease in net interest income that could result
from unfavorable changes in interest rate over a certain period (e.g., 1 year), and the interest rate VaR
represents the maximum expected loss that indicates how much net asset value can decrease at present or in
the future due to unfavorable changes in interest rates.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 49 -
227
For assets and liabilities as of December 31, 2019 that include bank, consolidated trusts and subsidiaries of
the bank, details of △EVE and △NII calculated based on interest rate risk in banking book (IRRBB) are
as follows (Unit: Korean Won in millions):
△EVE(*1)
△NII(*2)
December 31, 2019
490,981
162,023
(*1)
(*2)
EVE: change in Economic Value of Equity
NII: change in Net Interest Income
△
△
NII and NPV according to interest rate change scenario for assets and liabilities held by banks and
connected trusts as of December 31, 2018 are as follows (Unit: Korean Won in millions):
Base case
Base case (Prepay)
IR 100bp up
IR 100bp down
IR 200bp up
IR 200bp down
IR 300bp up
IR 300bp down
(*1) NII: Net Interest Income
(*2) NPV: Net Portfolio Value
December 31, 2018
NII (*1)
NPV (*2)
4,895,332
4,887,799
5,575,470
4,329,543
6,603,132
3,508,859
7,560,155
3,352,267
24,636,678
24,225,946
24,415,761
24,907,344
24,232,738
25,245,667
24,079,415
25,680,084
For the remaining subsidiaries except the bank, consolidated trusts, and consolidated subsidiaries of the
bank as of December 31, 2019, and for the subsidiaries other than the bank and consolidated trusts as of
December 31, 2018, the interest rate EaR and VaR calculated based on the BIS Framework are as follows
(Unit: Korean Won in millions):
December 31, 2019
December 31, 2018
EaR (*1)
VaR (*2)
EaR (*1)
VaR (*2)
92,439
87,872
248,364
141,484
(*1) EaR(Earning at Risk): Change of Maximum expected income and expense
(*2) VaR(Value at Risk): Maximum expected losses
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 228
- 50 -
The Group estimates and manages risks related to changes in interest rate due to the difference in the
maturities of interest-bearing assets and liabilities and discrepancies in the terms of interest rates. Cash
flows (both principal and interest), interest bearing assets and liabilities, presented by each re-pricing date,
are as follows (Unit: Korean Won in millions):
Within 3
months
4 to 6
months
December 31, 2019
10 to 12
months
7 to 9
months
1 to 5
years
Over 5 years
Total
Asset:
Loans and other
financial assets
at amortized cost 153,023,603
49,505,606
12,505,250
10,506,470
57,582,270
5,209,670 288,332,869
Financial assets at
FVTPL
Financial assets at
FVTOCI
Securities at
150,149
23,648
63,825
34,299
131,206
13,347
416,474
5,414,586
5,486,113
3,450,669
3,174,893
9,367,756
318,371
27,212,388
amortized cost
Total
1,844,868
160,433,206
1,696,004
56,711,371
738,383
16,758,127
1,409,549
15,125,211
14,869,227
81,950,459
858,142
21,416,173
6,399,530 337,377,904
Liability:
Deposits due to
customers
Borrowings
Debentures
Total
116,490,812
12,105,234
2,378,211
130,974,257
45,803,202
1,910,759
2,894,577
50,608,538
32,683,132
1,048,991
3,330,658
37,062,781
26,740,013
706,952
2,466,142
29,913,107
43,175,232
3,264,861
19,211,409
65,651,502
59,305 264,951,696
509,359
19,546,156
32,818,388
2,537,391
3,106,055 317,316,240
Within 3
months
4 to 6
months
7 to 9
months
December 31, 2018
10 to 12
months
1 to 5
years
Over 5 years
Total
Asset:
Loans and other
financial assets
at amortized cost 159,894,065
45,387,214
8,878,060
9,903,959
46,459,450
4,201,379 274,724,127
Financial assets at
FVTPL
Financial assets at
FVTOCI
Securities at
371,984
32,278
24,951
64,838
145,121
27,536
666,708
2,579,442
1,775,435
1,486,953
2,223,494
9,289,742
185,320
17,540,386
amortized cost
Total
2,449,416
165,294,907
2,251,180
49,446,107
1,735,698
12,125,662
1,946,948
14,139,239
15,177,608
71,071,921
402,671
23,963,521
4,816,906 316,894,742
Liability:
Deposits due to
customers
Borrowings
Debentures
Total
100,232,916
9,971,680
2,153,916
112,358,512
44,207,416
1,924,390
2,416,483
48,548,289
29,419,951
670,404
2,201,070
32,291,425
35,427,657
518,167
2,584,230
38,530,054
40,130,055
2,723,156
18,955,400
61,808,611
72,276 249,490,271
16,434,161
626,364
2,403,077
30,714,176
3,101,717 296,638,608
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 51 -
229
(3) Currency risk
Currency risk arises from the financial instruments denominated in foreign currencies other than the functional
currency. Therefore, no currency risk arises from non-monetary items or financial instruments denominated in
the functional currency.
Financial instruments in foreign currencies exposed to currency risk are as follows (Unit: USD in millions, JPY
in millions, CNY in millions, EUR in millions, and Korean Won in millions):
USD
JPY
December 31, 2019
CNY
EUR
Foreign
currency
Korean
Won
equivalent
Foreign
currency
Korean
Won
equivalent
Foreign
currency
Korean
Won
equivalent
Foreign
currency
Korean
Won
equivalent
Others
Korean
Won
equivalent
Total
Korean Won
equivalent
22,916
26,531,794
150,462
1,600,140
31,393
5,203,131
2,258
2,929,312
5,272,352
41,536,729
165
190,733
5,322
56,602
25
4,155
105
135,827
64,185
451,502
2,679
3,102,752
-
-
2,005
332,319
25
33,017
406,753
3,874,841
Asset
Loans and other
financial assets at
amortized cost
Financial assets at
FVTPL
Financial assets at
FVTOCI
Securities
at
amortized cost
Total
319
26,079
369,677
30,194,956
-
155,784
-
1,656,742
-
33,423
-
5,539,605
40
2,428
52,139
3,150,295
97,092
5,840,382
518,908
46,381,980
Liability
Financial
liabilities at
FVTPL
Deposits due to
customers
Borrowings
Debentures
Other financial
liabilities
Total
251
291,102
4,415
46,957
-
-
68
87,776
83,790
509,625
13,208
6,588
3,999
15,291,671
7,627,665
4,629,944
166,108
11,061
-
1,766,526
117,634
-
27,739 4,597,467
2,743
-
16
-
3,016
27,062
3,492,462
31,332,844
11,240
192,824
119,529
2,050,646
3,079
510,281
30,834 5,110,491
1,727
515
105
359
2,774
2,240,884
668,060
136,230
3,247,164
499,046
271,790
27,143,712
8,915,148
5,037,964
466,240
3,599,190
6,906
4,108,696
4,595,418
46,201,867
Off-balance accounts
7,030
8,139,395
34,316
364,946
4,525
749,973
560
726,323
634,870
10,615,507
USD
JPY
December 31, 2018
CNY
EUR
Foreign
currency
Korean
Won
equivalent
Foreign
currency
Korean
Won
equivalent
Foreign
currency
Korean
Won
equivalent
Foreign
currency
Korean
Won
equivalent
Others
Korean
Won
equivalent
Total
Korean Won
equivalent
20,406
22,816,027
167,419
1,696,255
29,880
4,863,230
1,994
2,550,147
4,742,340
36,667,999
74
82,197
1,425
14,434
-
-
1,472
1,645,595
-
-
1,604
261,085
59
-
75,169
79,584
251,384
-
729,581
2,636,261
52
22,004
58,489
24,602,308
-
168,844
-
1,710,689
-
31,484
-
5,124,315
-
2,053
-
2,625,316
175,552
5,727,057
234,041
39,789,685
118
131,927
1,956
19,815
-
-
11,159
6,606
3,645
12,477,154
7,386,616
4,075,084
169,770
3,834
-
1,720,072
38,847
-
23,967
381
-
3,900,923
61,947
-
55
887
286
-
70,250
121,658
343,650
1,135,149
365,585
-
4,392,936
505,541
285,339
23,626,234
8,358,536
4,360,423
2,522
24,050
2,820,290
26,891,071
28,955
204,515
293,362
2,072,096
1,818
26,166
295,919
4,258,789
193
1,421
246,584
1,817,568
18,527
5,324,001
3,674,682
40,363,525
Asset
Liability
Loans and other
financial assets
at amortized cost
Financial assets at
FVTPL
Financial assets at
FVTOCI
Securities at
amortized cost
Total
Financial
liabilities at
FVTPL
Deposits due to
customers
Borrowings
Debentures
Other financial
liabilities
Total
Off-balance accounts
7,453
8,333,153
33,347
337,868
1,557
253,366
474
606,714
823,655
10,354,756
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
230
(4) Liquidity risk
- 52 -
Liquidity risk refers to the risk that the Group may encounter difficulties in meeting obligations from its
financial liabilities.
1) Liquidity risk management
Liquidity risk management is to prevent potential cash shortages as a result of mismatching the use of funds
(assets) and sources of funds (liabilities) or unexpected cash outflows. The financial liabilities that are
relevant to liquidity risk are incorporated within the scope of risk management. Derivatives instruments are
excluded from those financial liabilities as they reflect expected cash flows for a pre-determined period.
Assets and liabilities are grouped by account under Asset Liability Management (“ALM”) in accordance
with the characteristics of the account. The Group manages liquidity risk by identifying the maturity gap
and such gap ratio through various cash flows analysis (i.e. based on remaining maturity and contract
period, etc.), while maintaining the gap ratio at or below the target limit.
2) Maturity analysis of non-derivative financial liabilities
a) Cash flows of principals and interests by remaining contractual maturities of non-derivative financial
liabilities are as follows (Unit: Korean Won in millions):
Financial liabilities at
FVTPL
Deposits due to customers
Borrowings
Debentures
Lease liabilities
Other financial liabilities
Total
Financial liabilities at
FVTPL
Deposits due to customers
Borrowings
Debentures
Other financial liabilities
Total
Within 3
months
4 to 6
months
December 31, 2019
10 to 12
months
7 to 9
months
1 to 5
years
Over
5 years
Total
115,156
-
166,474,535 36,697,168
8,596,202
2,948,384
2,378,211
2,894,577
46,072
42,549
60,981
11,242,367
188,852,543 42,643,659
-
24,634,859
2,162,846
3,330,658
37,420
119,633
30,285,416
-
31,233,844
1,880,424
2,466,142
35,210
10,344
35,625,964
-
6,590,119
3,682,214
19,211,409
232,985
71,561
29,788,288
-
115,156
1,877,594 267,508,119
520,936
19,791,006
2,537,391
32,818,388
40,698
434,934
14,165,526
2,660,640
7,637,259 334,833,129
Within 3
months
4 to 6
months
December 31, 2018
10 to 12
months
7 to 9
Months
1 to 5
years
Over
5 years
Total
191,825
-
145,187,689 33,825,662
2,846,294
6,373,835
2,416,483
2,153,916
14,240,022
44,572
168,147,287 39,133,011
-
22,186,833
1,874,069
2,201,070
169,996
26,431,968
-
42,046,740
1,607,985
2,584,230
1,201
46,240,156
-
7,098,907
3,156,128
18,955,400
90,615
29,301,050
-
191,825
1,870,334 252,216,165
16,500,328
642,017
30,714,176
2,403,077
2,288,560
16,834,966
7,203,988 316,457,460
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 53 -
231
b) Cash flows of principals and interests by expected maturities of non-derivative financial liabilities are
as follows (Unit: Korean Won in millions):
Financial liabilities at FVTPL
Deposits due to customers
Borrowings
Debentures
Lease liabilities
Other financial liabilities
Total
Financial liabilities at FVTPL
Deposits due to customers
Borrowings
Debentures
Other financial liabilities
Total
Within 3
months
115,156
175,309,271
8,596,202
2,378,211
46,072
11,242,367
197,687,279
Within 3
months
191,825
163,787,990
6,373,835
2,153,916
14,240,022
186,747,588
4 to 6
months
December 31, 2019
10 to 12
months
7 to 9
months
1 to 5
years
-
-
38,219,793 23,649,424
2,162,846
3,330,658
37,420
119,633
44,166,284 29,299,981
2,948,384
2,894,577
42,549
60,981
-
24,102,750
1,880,424
2,466,142
35,210
10,344
28,494,870
-
5,547,232
3,682,214
19,211,409
232,985
71,561
28,745,401
4 to 6
months
December 31, 2018
10 to 12
months
7 to 9
months
1 to 5
years
-
-
38,126,886 20,993,436
1,874,069
2,201,070
169,996
43,434,235 25,238,571
2,846,294
2,416,483
44,572
-
23,262,092
1,607,985
2,584,230
1,201
27,455,508
-
5,230,533
3,156,128
18,955,400
90,615
27,432,676
Over 5
years
-
150,233
520,936
2,537,391
40,698
2,660,640
5,909,898
Over 5
years
-
17,649
642,017
2,403,077
2,288,560
5,351,303
Total
115,156
266,978,703
19,791,006
32,818,388
434,934
14,165,526
334,303,713
Total
191,825
251,418,586
16,500,328
30,714,176
16,834,966
315,659,881
3) Maturity analysis of derivative financial liabilities
Derivatives held for trading purpose are not managed in accordance with their contractual maturity, since
the Group holds such financial instruments with the purpose of disposing or redemption before their
maturity. As such, those derivatives are incorporated as “within 3 months” in the table below. Derivatives
designated for hedging purpose are estimated by offsetting cash inflows and cash outflows.
The cash flow by the maturity of derivative financial liabilities as of December 31, 2019 and 2018 is as
follows (Unit: Korean Won in millions):
December 31,
2019
December 31,
2018
Cash flow risk hedge
Trading purpose
Cash flow risk hedge
Fair value risk hedge
Trading purpose
Within 3
months
1,839
2,843,195
(1,880)
(3,835)
2,090,861
4 to 6
months
(341)
-
(683)
9,448
-
7 to 9
months
Remaining maturity
10 to 12
months
(247)
-
14,133
9,133
-
(298)
-
8,080
(3,541)
-
1 to 5
years
6,249
-
14,103
6,991
-
Over 5
years
-
-
-
-
-
Total
7,202
2,843,195
33,753
18,196
2,090,861
4) Maturity analysis of off-balance accounts (Guarantees and loan commitments)
The Group provides guarantees on behalf of customers. A financial guarantee represents an irrevocable
undertaking that the Group should meet a customer’s obligations to third parties if the customer fails to do
so. Under a loan commitment, the Group agrees to make funds available to a customer in the future.
Commitments to lend include commercial standby facilities and credit lines, liquidity facilities to
commercial paper conduits and utilized overdraft facilities. The maximum limit to be paid by the Group in
accordance with guarantees and loan commitment only applies to principal amounts. There are contractual
maturities for financial guarantees, such as guarantees for debentures issued or loans, unused loan
commitments, and other guarantees, however, under the terms of the guarantees and unused loan
commitments, funds should be paid upon demand from the counterparty. Details of off-balance accounts
are as follows (Unit: Korean Won in millions):
Guarantees
Loan commitments
December 31, 2019
December 31, 2018
12,618,917
103,651,674
12,666,417
97,796,704
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 232
(5) Operational risk
- 54 -
The Group defines the operational risk that could cause a negative effect on capital resulting from inadequate
internal process, labor work and systematic problem or external factors.
1) Operational risk management
The Group has been running the operational risk management system under Basel II. The Group developed
Advanced Measurement Approaches (“AMA”) to quantify required capital for operational risk. This
system is used for reinforcement in foreign competitions, reducing the amount of risk capitals, managing
the risk, and precaution for any unexpected occasions. This system has been tested by an independent third
party and approved by the Financial Supervisory Service.
2) Operational risk measurement
To quantify required capital for operational risk, the Group applies AMA using internal and external loss
data, business environment and internal control factors, and scenario analysis. For the operational risk
management for its subsidiaries, the Group adopted the Basic Indicator Approach.
(6) Capital management
The Group complies with the standard of capital adequacy provided by financial regulatory authorities. The
capital adequacy standard is based on Basel published by Basel Ⅲ Committee on Banking Supervision in Bank
for International Settlement in 2010 and was implemented in Korea in December 2013. The capital adequacy
ratio is calculated by dividing own capital by asset (weighted with a risk premium – risk weighted assets) based
on the consolidated financial statements of the Group.
According to the above regulations, the Group is required to meet the following new minimum requirements:
Tier 1 common capital ratio of 7.00%, a Tier 1 capital ratio of 8.5% and a minimum total capital ratio of 10.5%
as of December 31, 2019.
Details of the Group’s capital adequacy ratio as of December 31, 2019 are as follows (Unit: Korean Won in
millions):
Tier 1 capital
Other Tier 1 capital
Tier 2 capital
Total risk-adjusted capital
Risk-weighted assets for credit risk
Risk-weighted assets for market risk
Risk-weighted assets for operational risk
Total risk-weighted assets
Common Equity Tier 1 ratio
Tier 1 capital ratio
Total capital ratio
December 31, 2019
19,135,300
3,340,252
4,639,519
27,115,071
209,802,895
5,586,757
12,656,301
228,045,953
8.39%
9.86%
11.89%
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 55 -
233
5. OPERATING SEGMENTS
In evaluating the results of the Group and allocating resources, the Group’s Chief Operation Decision Maker
(“CODM”) utilizes the information per type of customers. With the establishment of Woori Financial Group Inc.
during the current term, the company reports to the CODM according to the organizational sectors below. This
financial information of the segments is regularly reviewed by the CODM to make decisions about resources to
be allocated to each segment and evaluate its performance.
(1) Segment by type of organization
The Group’s reporting segments consist of banking, credit card, comprehensive finance and other sectors, and
the composition of such reporting segments was divided based on internal report data periodically reviewed by
the management to evaluate the performance of the segment and make decisions on the resources to be
distributed.
Operational scope
Banking
Credit card
Investment
banking
Others
Loans/deposits and relevant services for Woori Bank and overseas subsidiaries’ customers
Credit card, cash services, card loans and relevant work of Woori Card Co., Ltd.
Securities operation, sale of financial instruments, project financing and other related activities for
comprehensive financing of Woori Investment bank Co., Ltd.
Woori Financial Group Inc., Woori FIS Co., Ltd., Woori Finance Research Institute, Woori Credit
Information Co., Ltd., Woori Fund Services Inc., Woori Asset Management Corp., Ltd., Woori Private
Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd.
(2) The details of income (expense) by each segment are as follows (Unit: Korean Won in millions):
Banking
Credit card
For the year ended December 31, 2019
Investment
banking
Others (*1)
Sub-total
Adjustments
(*2)
Total
Net Interest
income(expense)
Non-interest
income(expense)
Impairment losses
due to credit loss
General and
administrative
expense(*3)
Net operating
4,583,386
553,956
54,077
2,290
5,193,709
699,997
5,893,706
1,557,247
31,842
33,539
957,880
2,580,508
(1,533,917)
1,046,591
(32,621)
(259,604)
(572)
(538)
(293,335)
(80,909)
(374,244)
(3,478,535)
(190,062)
(31,183)
(323,528)
(4,023,308)
257,231
(3,766,077)
income(expense)
2,629,477
136,132
55,861
636,104
3,457,574
(657,598)
2,799,976
Non-operating
income(expense)
Net income(expense)
before tax
Tax income(expense)
Net income(loss)
(151,348)
13,889
(3,501)
(1,545)
(142,505)
65,578
(76,927)
2,478,129
(616,110)
1,862,019
150,021
(35,825)
114,196
52,360
998
53,358
634,559
(1,294)
633,265
3,315,069
(652,231)
2,662,838
(592,020)
(33,222)
(625,242)
2,723,049
(685,453)
2,037,596
(*1) Other subsidiaries include gains and losses from Woori Financial Group Inc., Woori FIS Co., Ltd., Woori Finance
Research Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Service Inc., Woori Asset Management
Corp., Woori Private Equity Asset Management Co., Ltd. and Woori Global Asset Management Co., Ltd.
(*2) Adjustments were made for the presentation of profit or loss in accordance with the Accounting Standards from
the reporting segments in accordance with the Managerial Accounting Standards.
(*3) Depreciation and amortization 481,176 million Won are included in General and administrative expense. There are
the Banking (435,227 million Won), Credit card (28,367 million Won), Investment banking (2,212 million Won),
others (16,492 million Won) and adjustments ((-) 1,122 million Won) respectively.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 234
- 56 -
Banking
Credit card
For the year ended December 31, 2018 (*1)
Reporting
segment total
Investment
Banking
Others (*2)
Adjustments
(*3)
Total
Net Interest
income(expense)
Non-interest
income(expense)
Impairment losses
due to credit loss
General and
administrative
expense (*4)
Net operating
4,453,511
509,999
43,081
1,142
5,007,732
643,219
5,650,951
1,517,141
59,971
19,814
297,196
1,894,122
(832,165)
1,061,957
4,913
(227,144)
(3,898)
(166)
(226,296)
(103,278)
(329,574)
(3,416,320)
(170,765)
(26,081)
(292,826)
(3,905,993)
281,960
(3,624,033)
income(expense)
2,559,245
172,060
32,915
5,345
2,769,565
(10,264)
2,759,301
Non-operating
income(expense)
Net income(expense)
before tax
Tax income(expense)
Net income(loss)
69,897
(5,547)
(295)
199
64,255
(18,684)
45,571
2,629,142
(713,178)
1,915,964
166,513
(39,979)
126,534
32,621
743
33,364
5,545
(2,238)
3,307
2,833,821
(754,651)
2,079,169
(28,949)
1,428
(27,520)
2,804,872
(753,223)
2,051,649
(*1) For comparative display, the category information of each customer from the previous term has been reclassified
to profit or loss by operating segment according to the organization.
(*2) Other subsidiaries include gains and losses from Woori FIS Co., Ltd., Woori Finance Research Co., Ltd., Woori
Credit Information Co., Ltd., Woori Fund Service Inc. and Woori Private Equity Asset Management Co., Ltd.
(*3) Adjustments were made for the presentation of profit or loss in accordance with the Accounting Standards from
the reporting segments in accordance with the Managerial Accounting Standards.
(*4) Depreciation and amortization 216,735 million Won are included in General and administrative expense. There are
the Banking (177,882 million Won), Credit card (11,477 million Won), Investment banking (977 million Won),
others (26,398 million Won) and adjustments (1 million Won), respectively.
(3) Operating profit or loss and major non-current assets from external customers for the period are as follows
(Unit: Korean Won in millions):
Operating income(expense) from external
customers
Major non-current assets (*)
For the year ended December 31, 2019
Domestic
Foreign
Total
2,500,504
299,472
2,799,976
4,908,140
387,284
5,295,424
(*) Investments in joint ventures and associates, investment properties, premises and equipment and intangible assets
and right-of-use assets are included in major non-current assets.
Operating income(expense) from external
customers
Major non-current assets (*)
For the year ended December 31, 2018
Domestic
Foreign
Total
2,505,813
253,488
2,759,301
3,551,924
236,050
3,787,974
(*) Investments in joint ventures and associates, investment properties, premises and equipment and intangible assets
and right-of-use assets are included in major non-current assets.
(4)
Information about major customers
The Group does not have any single customer that generates 10% or more of the Group’s total revenue as of
December 31, 2019 and 2018.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 57 -
235
6.
STATEMENTS OF CASH FLOWS
(1) Details of cash and cash equivalents are as follows (Unit: Korean Won in millions):
Cash
Foreign currencies
Demand deposits
Fixed deposits
Total
December 31, 2019
1,957,997
625,999
3,684,044
124,526
6,392,566
December 31, 2018
2,107,861
725,083
3,512,216
402,734
6,747,894
(2) Significant transactions of investing activities and financing activities not involving cash inflows and
outflows are as follows (Unit: Korean Won in millions):
For the years ended December 31
2018
2019
Changes in other comprehensive income related to
valuation of financial assets at FVTOCI
Changes in other comprehensive income related to
valuation of equity method investments
Changes in other comprehensive income related to
valuation loss on cash flow hedge
Changes in equity related to assets held for sale
Changes in financial assets at FVTOCI as a
result of debt-equity swap
Changes in investments in associates
due to accounts transfer
Classified to premises and equipment from
investment properties
Changes in intangible assets related to account
payables
Classified to assets held for distribution (sale) from
premises and equipment
Increase in right-of-use assets and lease
liabilities
Changes in unpaid dividends on hybrid equity
securities
Comprehensive stock exchange
(14,141)
613
(1,823)
-
96,527
651
166,892
29,705
(95)
692,103
-
581,609
2,505
2,958
(4,646)
(4,145)
14,378
(89,151)
-
-
6,243
-
3,569
-
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 236
- 58 -
(3) Adjustments of liabilities from financing activities in current and prior year are as follows (Unit: Korean
Won in millions):
For the year ended December 31, 2019
Not involving cash inflows and outflows
Variation of
gains on
valuation of
hedged
items
Business
Combination
(Note 45)
Beginning
balance
16,202,986
28,735,862
377,030
45,315,878
Cash flow
3,081,757
1,858,762
(217,867)
4,722,652
Foreign
Exchange
(285,607)
155,433
(819)
(130,993)
Borrowings
Debentures
Lease liabilities(*)
Total
-
-
5,552
5,552
(*) The amount of lease liability at the beginning of the current in applying K-IFRS 1116 is reflected.
-
85,984
-
85,984
Others
(216)
22,014
255,149
276,947
Ending
balance
18,998,920
30,858,055
419,045
50,276,020
For the year ended December 31, 2018
Foreign
Exchange
Not involving cash inflows and outflows
Variation of
gains on
valuation of
hedged items
-
(25,498)
(25,498)
161,078
267,339
428,417
Others
81
12,039
12,120
Ending
balance
16,202,986
28,735,862
44,938,848
Borrowings
Debentures
Total
Beginning
balance
14,784,706
27,869,651
42,654,357
Cash flow
1,257,121
612,331
1,869,452
7.
FINANCIAL ASSETS AT FVTPL
(1) Details of financial assets at FVTPL as of December 31, 2019 and 2018 are as follows (Unit: Korean Won
in millions):
Financial assets at fair value through profit or loss
measured at fair value
December 31, 2019
December 31, 2018
8,069,144
6,126,316
(2) Financial assets at fair value through profit or loss mandatorily measured at fair value and financial assets
held for trading are as follows (Unit: Korean Won in millions):
Deposits:
Gold banking asset
Securities:
Debt securities
Korean treasury and government agencies
Financial institutions
Corporates
Others
Equity securities
Capital contributions
Beneficiary certificates
Loans
Derivatives assets
Sub-total
Total
December 31, 2019
December 31, 2018
27,901
26,935
872,954
600,303
762,265
101,563
688,350
515,199
1,366,233
4,906,867
212,473
2,921,903
8,069,144
516,173
533,393
774,589
-
455,666
422,614
985,417
3,687,852
385,450
2,026,079
6,126,316
(3) Financial assets at fair value through profit or loss designated as upon initial recognition is nil as of
December 31, 2018 and 2019.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 59 -
237
8.
FINANCIAL ASSETS AT FVTOCI
(1) Details of financial assets at FVTOCI as of December 31, 2019 and 2018 is as follows (Unit: Korean Won
in millions):
Debt securities:
Korean treasury and government agencies
Financial institutions
Corporates
Bond denominated in foreign currencies
Equity securities
Securities loaned
Sub-total
Total
December 31, 2019
December 31, 2018
1,152,711
17,769,924
3,917,004
3,874,785
26,714,424
935,370
80,737
27,730,531
1,358,378
11,252,790
1,824,843
2,636,209
17,072,220
951,174
40,029
18,063,423
(2) Details of equity securities designated as financial assets at FVTOCI as of December 31, 2019 and 2018 are
as follows (Unit: Korean Won in millions):
Purpose of acquisition
Investment for strategic business
partnership purpose
Debt-equity swap
Others
Total
December
31, 2019
December
31, 2018
Remarks
678,846
256,480
44
935,370
662,934
287,990
250
951,174
Cooperative insurance, etc.
(3) Changes in the loss allowance and gross carrying amount of financial assets at FVTOCI are as follows (Unit:
Korean Won in millions):
1) Allowance for credit losses
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net provision of loss allowance
Disposal
Others (*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net provision of loss allowance
Others (*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
For the year ended December 31, 2019
Stage 1
Stage 2
Stage 3
Total
(5,939)
-
-
-
(3,297)
615
52
(8,569)
(238)
-
-
-
-
238
-
-
-
-
-
-
-
-
-
-
(6,177)
-
-
-
(3,297)
853
52
(8,569)
For the year ended December 31, 2018
Stage 1
Stage 2
Stage 3
Total
(4,107)
-
-
-
(1,918)
86
(5,939)
(129)
-
-
-
(109)
-
(238)
-
-
-
-
-
-
-
(4,236)
-
-
-
(2,027)
86
(6,177)
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 238
- 60 -
2) Gross carrying amount
For the year ended December 31, 2019
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Acquisition
Disposal / Redemption
Gain (loss) on valuation
Amortization based on effective interest
method
Business combination (Note 45)
Others (*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
Stage 1
17,087,096
-
-
-
23,774,375
(14,224,358)
48,956
14,629
24,985
69,478
26,795,161
Stage 2
Stage 3
25,153
-
-
-
-
(25,000)
(153)
-
-
-
-
Total
17,112,249
-
-
-
23,774,375
(14,249,358)
48,803
14,629
24,985
69,478
26,795,161
-
-
-
-
-
-
-
-
-
-
-
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Acquisition
Disposal / Redemption
Gain (loss) on valuation
Amortization based on effective interest
method
Others (*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
For the year ended December 31, 2018
Stage 1
12,843,997
-
-
-
13,275,429
(9,146,307)
70,017
10,195
33,765
17,087,096
Stage 2
Stage 3
30,212
-
-
-
10,000
(15,047)
(59)
47
-
25,153
Total
12,874,209
-
-
-
13,285,429
(9,161,354)
69,958
10,242
33,765
17,112,249
-
-
-
-
-
-
-
-
-
-
(4) During the term, the Group sold its equity securities., designated as financial assets at FVTOCI in
accordance with the sale settlement of the creditors and the fair value at disposal is 34,841 million Won and
the cumulative loss at disposal is 38,995 million Won.
9.
SECURITIES AT AMORTIZED COST
(1) Details of securities at amortized cost as of December 31, 2019 and December 31, 2018 are as follows
(Unit: Korean Won in millions):
Korean treasury and government agencies
Financial institutions
Corporates
Bond denominated in foreign currencies
Allowance for credit losses
Total
December 31, 2019
8,044,040
6,694,614
5,068,489
518,907
(5,511)
20,320,539
December 31, 2018
7,523,458
9,474,922
5,707,063
234,041
(6,925)
22,932,559
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 61 -
239
(2) Changes in the loss allowance and gross carrying amount of securities at amortized cost are as follows
(Unit: Korean Won in millions):
1) Loss allowance
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net reversal of loss allowance
Others (*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net provision of loss allowance
Disposal
Others (*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
2) Gross carrying amount
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Acquisition
Disposal/Redemption
Amortization based on effective interest
method
Others (*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Acquisition
Disposal/Redemption
Amortization based on effective interest
method
Others (*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
For the years ended December 31, 2019
Stage 1
Stage 2
Stage 3
Total
(6,924)
-
-
-
1,415
(2)
(5,511)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(6,924)
-
-
-
1,415
(2)
(5,511)
For the year ended December 31, 2018
Stage 1
Stage 2
Stage 3
Total
(5,078)
-
-
-
(1,922)
22
54
(6,924)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(5,078)
-
-
-
(1,922)
22
54
(6,924)
For the year ended December 31, 2019
Stage 1
22,939,484
-
-
-
6,092,078
(8,709,947)
(3,286)
7,721
20,326,050
Stage 2
Stage 3
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
For the year ended December 31, 2018
Stage 1
16,749,296
-
-
-
15,622,847
(9,426,757)
(7,970)
2,068
22,939,484
Stage 2
Stage 3
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
22,939,484
-
-
-
6,092,078
(8,709,947)
(3,286)
7,721
20,326,050
Total
16,749,296
-
-
-
15,622,847
(9,426,757)
(7,970)
2,068
22,939,484
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
240
- 62 -
10. LOANS AND OTHER FINANCIAL ASSETS AT AMORTIZED COST, AND LOANS AND RECEIVABLES
(1) Details of loans and other financial assets at amortized cost as of December 31, 2019 and loans and
receivables as of December 31, 2018 are as follows (Unit: Korean Won in millions):
Due from banks
Loans
Other financial assets
Total
December 31, 2019
December 31, 2018
14,492,223
271,032,244
8,193,226
293,717,693
14,151,012
260,819,917
7,486,649
282,457,578
(2) Details of due from banks are as follows (Unit: Korean Won in millions):
December 31, 2019
December 31, 2018
Due from banks in local currency:
Due from The Bank of Korea (“BOK”)
Due from depository banks
Due from non-depository institutions
Due from the Korea Exchange
Others
Loss allowance
Due from banks in foreign currencies:
Sub-total
Due from banks on demand
Due from banks on time
Others
Loss allowance
Sub-total
Total
11,028,850
82,509
378
50,113
43,253
(2,865)
11,202,238
1,122,521
1,296,842
872,617
(1,995)
3,289,985
14,492,223
11,034,602
90,988
76
30,000
85,915
(3,069)
11,238,512
828,022
1,288,303
798,493
(2,318)
2,912,500
14,151,012
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 63 -
241
(3) Details of restricted due from banks are as follows (Unit: Korean Won in millions):
Counterparty
Amount
Reason of restriction
Due from banks in local currencies:
Due from BOK The BOK
Due from
KSFC
Others
Korea Securities Finance
Corp.
The Korea Exchange and
others
Sub-total
Due from banks in foreign currencies:
Due from
banks on
demand
Foreign
currency
deposits on
time
Others
The BOK and others
National Bank Cambodia
Korea Investment &
Securities and others
Sub-total
Total
Reserve deposits
under the BOK Act
Customer’s deposit reserve
Central counterparty KRW
margin and others
11,028,850
50,000
41,645
11,120,495
Reserve deposits under the BOK
1,103,917
Act and others
Reserve deposits and others
Overseas futures and options
trade deposits and others
58
872,603
1,976,578
13,097,073
Counterparty
December 31, 2018
Reason of restriction
Due from banks in local currencies:
Due from BOK The BOK
Due from KSFC Korea Securities
Finance Corp.
Others
The Korea Exchange
and others
Sub-total
Due from banks in foreign currencies:
Due from banks
on demand
Others
The BOK and others
The People’s Bank of
China and others
Sub-total
Total
Reserve deposits
under the BOK Act
Customer’s deposit reserve
Central counterparty KRW
margin and others
11,034,602
30,000
51,889
11,116,491
Reserve deposits under the
780,576
BOK Act and others
Reserve deposits and others
798,493
1,579,069
12,695,560
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 242
- 64 -
(4) Changes in the loss allowance and gross carrying amount of due from banks are as follows (Unit: Korean
Won in millions):
1) Allowance for credit losses
For the year ended December 31, 2019
Stage 1
Stage 2
Stage 3
Total
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Reversal of loss allowance
Others (*)
Ending balance
(5,387)
-
-
-
544
(17)
(4,860)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(5,387)
-
-
-
544
(17)
(4,860)
(*) Others consist of foreign currencies translation, etc.
For the year ended December 31, 2018
Stage 1
Stage 2
Stage 3
Total
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net provision of loss allowance
Others (*)
Ending balance
(3,092)
-
-
-
(2,219)
(76)
(5,387)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(3,092)
-
-
-
(2,219)
(76)
(5,387)
(*) Others consist of foreign currencies translation, etc.
2) Gross carrying amount
For the year ended December 31, 2019
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net increase(decrease)
Business combination (Note 45)
Others(*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
Stage 1
14,156,399
-
-
-
313,991
35,910
(9,217)
14,497,083
Stage 2
Stage 3
-
-
-
-
-
-
-
-
Total
14,156,399
-
-
-
313,991
35,910
(9,217)
14,497,083
-
-
-
-
-
-
-
-
For the year ended December 31, 2018
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net increase(decrease)
Others(*)
Ending balance
(*) Others consist of foreign currencies translation, etc.
Stage 1
8,870,835
-
-
-
5,302,244
(16,680)
14,156,399
Stage 2
Stage 3
-
-
-
-
-
-
Total
8,870,835
-
-
-
5,302,244
(16,680)
14,156,399
-
-
-
-
-
-
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 65 -
243
(5) Details of loans are as follows (Unit: Korean Won in millions):
December 31, 2019
December 31, 2018
Loans in local currency
Loans in foreign currencies
Domestic banker’s usance
Credit card accounts
Bills bought in foreign currencies
Bills bought in local currency
Factoring receivables
Advances for customers on guarantees
Private placement bonds
Securitized loans
Call loans
Bonds purchased under resale agreements
Others
Loan origination costs and fees
Discounted present value
Allowance for credit losses
Total
221,484,049
18,534,270
2,899,651
8,398,605
4,772,093
61,362
20,905
12,616
307,339
2,250,042
3,290,167
8,981,752
980,448
620,791
(6,826)
(1,575,020)
271,032,244
210,701,421
15,239,032
2,934,366
8,051,384
7,874,457
22,885
45,851
13,810
365,531
1,377,072
2,669,080
11,701,951
1,037,283
574,178
(10,308)
(1,778,076)
260,819,917
(6) Changes in the loss allowance of loans are as follows (Unit: Korean Won in millions):
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net reversal(provision) of loss allowance
Recovery
Charge-off
Disposal
Interest income from impaired loans
Business combination (Note 45)
Others (*)
Ending balance
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net reversal(provision) of loss allowance
Recovery
Charge-off
Disposal
Interest income from impaired loans
Business combination (Note 45)
Others (*)
Ending balance
For the year ended December 31, 2019
Stage 1
(114,509)
(14,430)
14,022
8,603
21,802
-
-
-
-
-
(636)
(85,148)
Consumers
Stage 2
(48,368)
13,661
(15,332)
10,312
(38,203)
-
-
-
-
-
(32)
(77,962)
Stage 3
(129,906)
769
1,310
(18,915)
(146,204)
(61,914)
217,382
2,763
9,647
-
(520)
(125,588)
Stage 1
(348,311)
(58,537)
8,215
3,308
86,565
-
-
-
-
(9)
(15,489)
(324,258)
Corporates
Stage 2
(349,619)
49,884
(20,473)
17,852
6,855
-
-
1
-
(2,008)
(210)
(297,718)
For the year ended December 31, 2019
Credit card accounts
Stage 2
(78,131)
15,231
(6,317)
94,116
(96,434)
-
-
-
-
-
2
(71,533)
Stage 1
(64,787)
(15,712)
6,031
98,647
(98,888)
-
-
-
-
-
(17)
(74,726)
Stage 3
(116,772)
481
286
(192,763)
(40,343)
(60,365)
281,420
-
-
-
14
(128,042)
Stage 1
(527,607)
(88,679)
28,268
110,558
9,479
-
-
-
-
(9)
(16,142)
(484,132)
Total
Stage 2
(476,118)
78,776
(42,122)
122,280
(127,782)
-
-
1
-
(2,008)
(240)
(447,213)
Stage 3
(527,673)
8,653
12,258
(21,160)
(75,392)
(66,359)
222,537
42,095
17,887
(3,150)
259
(390,045)
Stage 3
(774,351)
9,903
13,854
(232,838)
(261,939)
(188,638)
721,339
44,858
27,534
(3,150)
(247)
(643,675)
(*) Changes due to debt-equity swap, foreign currencies translation, and etc.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 244
- 66 -
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net reversal(provision) of loss allowance
Recovery
Charge-off
Disposal
Interest income from impaired loans
Others (*)
Ending balance
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net reversal(provision) of loss allowance
Recovery
Charge-off
Disposal
Interest income from impaired loans
Others (*)
Ending balance
For the year ended December 31, 2018
Stage 1
(101,479)
(9,848)
5,905
79,078
(86,224)
-
-
-
-
(1,941)
(114,509)
Consumers
Stage 2
(41,358)
8,966
(7,183)
47,343
(56,164)
-
-
33
-
(5)
(48,368)
Stage 3
(117,168)
882
1,278
(126,421)
(49,637)
(51,855)
204,552
1,633
7,945
(1,115)
(129,906)
Stage 1
(365,251)
(24,324)
15,074
62,731
(68,381)
-
-
-
-
31,840
(348,311)
Corporates
Stage 2
(255,922)
22,658
(407,780)
97,750
193,392
-
-
237
-
46
(349,619)
Stage 3
(905,243)
1,666
392,706
(160,481)
(94,004)
(127,630)
290,109
49,902
23,381
1,921
(527,673)
For the year ended December 31, 2018
Credit card accounts
Stage 2
(71,463)
13,738
(6,194)
84,048
(98,260)
-
-
-
-
-
(78,131)
Stage 1
(57,134)
(13,846)
5,871
82,406
(82,083)
-
-
-
-
(1)
(64,787)
Stage 3
(102,858)
108
323
(166,454)
(33,205)
(57,565)
242,879
-
-
-
(116,772)
Stage 1
(523,864)
(48,018)
26,850
224,215
(236,688)
-
-
-
-
29,898
(527,607)
Stage 3
Total
Stage 2
(368,743) (1,125,269)
2,656
394,307
(453,356)
(176,846)
(237,050)
737,540
51,535
31,326
806
(774,351)
45,362
(421,157)
229,141
38,968
-
-
270
-
41
(476,118)
(*) Changes due to debt-equity swap, foreign currencies translation, and etc.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 67 -
245
(7) Changes in the gross carrying amount of loans are as follows (Unit: Korean Won in millions):
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Charge-off
Disposal
Net increase (decrease)
Business combination (Note 45)
Ending balance
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Charge-off
Disposal
Net increase (decrease)
Business combination (Note 45)
Ending balance
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Charge-off
Disposal
Net increase (decrease)
Ending balance
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Charge-off
Disposal
Net increase (decrease)
Ending balance
For the year ended December 31, 2019
Stage 1
110,619,242
2,626,998
(8,238,499)
(152,128)
-
-
6,397,570
100
111,253,283
Consumers
Stage 2
6,028,009
(2,614,767)
8,256,600
(104,129)
-
(55)
883,149
-
12,448,807
Stage 1
Stage 3
391,494 131,453,727
1,560,734
(12,231)
(2,306,186)
(18,101)
(252,249)
256,257
-
(217,382)
(67,924)
-
3,985,392
85,561
2,561
-
417,674 134,443,979
Corporates
Stage 2
5,031,258
(1,550,164)
2,341,881
(142,902)
-
(70)
(809,566)
40,161
4,910,598
Stage 3
1,020,658
(10,570)
(35,695)
395,151
(222,537)
(161,318)
(266,432)
21,000
740,257
For the year ended December 31, 2019
Credit card accounts
Stage 2
982,772
(258,166)
307,450
(104,712)
-
-
(41,512)
-
885,832
Stage 1
6,861,844
258,674
(307,100)
(124,675)
-
-
589,724
-
7,278,467
Stage 3
Stage 1
208,989 248,934,813
4,446,406
(10,851,785)
(529,052)
-
-
10,972,686
2,661
228,367 252,975,729
(508)
(350)
229,387
(281,420)
-
72,269
-
Total
Stage 2
12,042,039
(4,423,097)
10,905,931
(351,743)
-
(125)
32,071
40,161
18,245,237
Stage 3
1,621,141
(23,309)
(54,146)
880,795
(721,339)
(229,242)
(108,602)
21,000
1,386,298
For the year ended December 31, 2018
Stage 1
103,502,347
1,921,485
(3,186,506)
(218,943)
-
-
8,600,859
110,619,242
Consumers
Stage 2
5,487,758
(1,912,046)
3,199,993
(127,447)
-
(478)
(619,771)
6,028,009
Stage 3
Stage 1
326,739 131,096,396
(9,439)
1,081,702
(13,487)
(2,275,984)
346,390
(348,503)
(204,552)
-
(31,910)
-
1,900,116
(22,247)
391,494 131,453,727
Corporates
Stage 2
4,466,354
(1,077,895)
2,733,860
(275,189)
-
(2,781)
(813,091)
5,031,258
Stage 3
1,622,409
(3,807)
(457,876)
623,692
(290,109)
(166,347)
(307,304)
1,020,658
For the year ended December 31, 2018
Credit card accounts
Stage 2
935,266
(221,841)
288,027
(95,758)
-
-
77,078
982,772
Stage 1
5,721,743
221,984
(287,623)
(104,459)
-
-
1,310,199
6,861,844
Stage 3
Stage 1
177,983 240,320,486
3,225,171
(5,750,113)
(671,905)
-
-
11,811,174
208,989 248,934,813
(143)
(404)
200,217
(242,879)
-
74,215
Total
Stage 2
10,889,378
(3,211,782)
6,221,880
(498,394)
-
(3,259)
(1,355,784)
12,042,039
Stage 3
2,127,131
(13,389)
(471,767)
1,170,299
(737,540)
(198,257)
(255,336)
1,621,141
(8) Details of other financial assets are as follows (Unit: Korean Won in millions):
CMA accounts
Receivables
Accrued income
Telex and telephone subscription rights and refundable deposits
Other receivables
Allowance for credit losses
Total
December 31, 2019
199,000
5,653,997
1,012,240
949,118
456,010
(77,139)
8,193,226
December 31, 2018
185,999
4,864,738
1,002,964
986,834
514,055
(67,941)
7,486,649
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 246
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(9) Changes in the allowances for credit losses on other financial assets are as follows (Unit: Korean Won in
millions):
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net reversal (provision) of loss allowance
Charge-off
Disposal
Business combination (Note 45)
Others
Ending balance
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Net provision of loss allowance
Charge-off
Disposal
Others
Ending balance
For the year ended December 30, 2019
Stage 1
Stage 2
Stage 3
Total
(3,469)
(207)
116
19
802
-
-
(401)
(56)
(3,196)
(1,971)
198
(43)
159
(9)
-
-
-
-
(1,666)
(62,501)
9
(73)
(178)
(6,854)
2,506
1,685
(7,268)
397
(72,277)
(67,941)
-
-
-
(6,061)
2,506
1,685
(7,669)
341
(77,139)
For the year ended December 30, 2018
Stage 1
Stage 2
Stage 3
Total
(2,955)
(150)
105
6,509
(6,583)
-
-
(395)
(3,469)
(1,832)
139
(416)
304
(166)
-
1
(1)
(1,971)
(54,211)
11
311
(6,813)
(31,550)
28,200
1,264
287
(62,501)
(58,998)
-
-
-
(38,299)
28,200
1,265
(109)
(67,941)
(10) Changes in the gross carrying amount of other financial assets are as follows (Unit: Korean Won in millions):
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Charge-off
Disposal
Net increase (decrease)
Business combination (Note 45)
Ending balance
Beginning balance
Transfer to 12-month expected credit losses
Transfer to lifetime expected credit losses
Transfer to credit-impaired financial assets
Charge-off
Disposal
Net increase (decrease)
Ending balance
(*) Others consist of foreign currencies translation, etc.
Stage 1
7,454,390
8,036
(17,678)
(952)
-
-
606,457
9,591
8,059,844
For the year ended December 30, 2019
Stage 2
Stage 3
28,193
(8,019)
17,740
(918)
-
-
55,651
-
92,647
72,007
(17)
(62)
1,870
(2,506)
(2,212)
41,138
7,656
117,874
Stage 1
6,662,335
7,573
(11,418)
(7,580)
-
-
803,480
7,454,390
For the year ended December 30, 2018
Stage 2
Stage 3
29,124
(7,556)
11,734
(1,110)
-
(5)
(3,994)
28,193
79,912
(17)
(316)
8,690
(28,201)
(1,640)
13,579
72,007
Total
7,554,590
-
-
-
(2,506)
(2,212)
703,246
17,247
8,270,365
Total
6,771,371
-
-
-
(28,201)
(1,645)
813,065
7,554,590
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 69 -
247
11. FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES
(1) The fair value hierarchy
The fair value hierarchy is determined by the levels of judgment involved in estimating fair values of financial
assets and liabilities. The specific financial instruments characteristics and market condition such as volume of
transactions and transparency are reflected to the market observable inputs. The fair value hierarchy gives the
highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities. The Group
maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value
of its financial assets and financial liabilities. Fair value is measured based on the perspective of a market
participant. As such, even when market assumptions are not readily available, the Group’s own assumptions
reflect those that market participants would use for measuring the assets or liabilities at the measurement date.
The fair value measurement is described in the one of the following three levels used to classify fair value
measurements:
•
•
•
Level 1—fair value measurements are those derived from quoted prices (unadjusted) in active markets for
identical assets or liabilities. The types of financial assets or liabilities generally included in Level 1 are
publicly traded equity securities, derivatives, and debt securities issued by governmental bodies.
Level 2— fair value measurements are those derived from inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. derived
from prices). The types of financial assets or liabilities generally included in Level 2 are debt securities
not traded in active markets and derivatives traded in OTC but not required significant judgment.
Level 3— fair value measurements are those derived from valuation technique that include inputs for the
assets or liabilities that are not based on observable market data (unobservable inputs). The types of
financial assets or liabilities generally included in Level 3 are non-public securities and derivatives and
debt securities of which valuation techniques require significant judgments and subjectivity.
The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such
cases, the level within the fair value hierarchy is based on the lowest level of input that is significant to the
fair value measurement. The Group’s assessment of the significance of a particular input to a fair value
measurement in its entirety requires judgment and consideration of inherent factors of the asset or liability.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 248
- 70 -
(2) Fair value hierarchy of financial assets and liabilities measured at fair value are as follows (Unit: Korean
Won in millions):
Level 1 (*)
Level 2 (*)
Level 3
Total
December 31, 2019
Financial assets:
Financial assets at fair value through profit
or loss mandatorily measured at fair value
Deposits
Debt securities
Equity securities
Capital contributions
Beneficiary certificates
Loans
Derivative assets (Designated for trading)
Sub-total
Financial assets at FVTOCI
Debt securities
Equity securities
Securities loaned
Sub-total
Derivative assets (Designated for hedging)
Total
Financial liabilities:
Financial liabilities at fair value through
profit or loss mandatorily measured at fair
value
Deposits due to customers
Derivative liabilities (Designated for
trading)
Sub-total
Financial liabilities at fair value through
profit or loss designated as upon initial
recognition
Equity-linked securities
Derivative liabilities (Designated for
hedging)
Total
27,901
420,330
157,895
-
1
-
3,057
609,184
2,146,163
441,672
-
2,587,835
-
3,197,019
27,530
4,336
31,866
-
-
31,866
-
1,910,929
1,834
-
90,498
59,844
2,893,798
4,956,903
24,568,261
-
80,737
24,648,998
121,131
29,727,032
-
5,826
528,621
515,199
1,275,734
152,629
25,048
2,503,057
-
493,698
-
493,698
-
2,996,755
27,901
2,337,085
688,350
515,199
1,366,233
212,473
2,921,903
8,069,144
26,714,424
935,370
80,737
27,730,531
121,131
35,920,806
-
-
27,530
2,766,771
2,766,771
72,039
72,039
2,843,146
2,870,676
-
87,626
87,626
6,516
2,773,287
321
159,986
6,837
2,965,139
(*) There were no transfers between Level 1 and Level 2 of financial assets and liabilities measured at fair value. The
Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions
have changed.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 71 -
249
Level 1 (*)
Level 2 (*)
Level 3
Total
December 31, 2018
Financial assets:
Financial assets at fair value through profit
or loss mandatorily measured at fair value
Deposits
Debt securities
Equity securities
Capital contributions
Beneficiary certificates
Loans
Derivative assets (Designated for trading)
Sub-total
Financial assets at FVTOCI
Debt securities
Equity securities
Securities loaned
Sub-total
Derivative assets (Designated for hedging)
Total
Financial liabilities:
Financial liabilities at fair value through
profit or loss mandatorily measured at fair
value
Deposits due to customers
Derivative liabilities (Designated for
trading)
Sub-total
Financial liabilities at fair value through
profit or loss designated as upon initial
recognition
Equity-linked securities
Derivative liabilities (Designated for
hedging)
Total
26,935
239,794
53,806
-
2,130
-
13,216
335,881
1,838,409
482,327
-
2,320,736
-
2,656,617
27,058
2,245
29,303
-
-
29,303
-
1,575,972
-
-
128,988
205,000
1,964,065
3,874,025
15,233,811
-
40,029
15,273,840
35,503
19,183,368
-
8,389
401,860
422,614
854,299
180,450
48,798
1,916,410
-
468,847
-
468,847
-
2,385,257
26,935
1,824,155
455,666
422,614
985,417
385,450
2,026,079
6,126,316
17,072,220
951,174
40,029
18,063,423
35,503
24,225,242
-
-
27,058
2,071,925
2,071,925
16,691
16,691
2,090,861
2,117,919
-
164,767
164,767
51,408
2,123,333
-
181,458
51,408
2,334,094
(*) There were no transfers between Level 1 and Level 2 of financial assets and liabilities measured at fair value. The
Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions
have changed.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 250
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Financial assets and liabilities at fair value through profit or loss, financial assets at FVTOCI, and derivative
assets (Designated for hedging) and liabilities (Designated for hedging) are recognized at fair value. Fair value is
the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction
between market participants at the measurement date.
Financial instruments are measured at fair value using a quoted market price in active markets. If there is no
active market for a financial instrument, the Group determines the fair value using valuation methods. Valuation
methods and input variables for each type of financial instruments are as follows:
① Valuation methods and input variables for each type of financial instrument classified into level 2 in
December 31, 2019 and 2018 are as follows:
Loans
Valuation methods
The fair value is measured by discounting the projected
cash flows of loan products by applying the market
discount rate that has been applied to a proxy
company that has similar credit rating to the debtor.
Input variables
Risk-free market rate, Credit spread
Debt securities and
Securities loaned
Fair value is measured by discounting the future cash
flows of debt securities applying the risk-free market
rate.
Risk-free market rate Credit spread
Beneficiary certificates
The beneficiary certificates classified as Level 2 are
Base price
MMF and are measured at base price.
Derivatives
The fair value is measured through option model
(Closed Form), DCF Model, FDM, Monte Carlo
Simulation and etc.
Market rate, foreign exchange rate,
stock prices and value of underlying
assets, volatility, and etc.
② Valuation methods and input variables for each type of financial instrument classified into level 3 in
December 31, 2019 and 2018 are as follows:
Loans
Debt securities
Equity securities, capital
contributions and
Beneficiary certificates
Valuation methods
The fair value of Loans is measured by the Binomial
tree given the values of underlying assets and
volatility.
The fair value is measured by discounting the projected
cash flows of debt securities by applying the market
discount rate that has been applied to a proxy
company that has similar credit rating to the issuers of
the securities.
Among DCF (Discounted Cash Flow) Model, FCFE
(Free Cash Flow to Equity) Model, Comparable
Company Analysis, Dividend Discount Model, Risk-
adjusted Rate of Return Method, and Net Asset Value
Method, more than one method is used given the
characteristic of the subject of fair value
measurement.
Input variables
Values of underlying assets, Volatility
Risk-free market rate, Credit spread
Risk-free market rate, market risk
premium, corporate Beta, etc.
Derivatives
Fair value is measured by models such as option model
(Closed form), DCF model, FDM and Monte Carlo
Simulation.
Market rate, values of underlying
assets such as foreign exchange rate
and stock prices, volatility, etc.
Equity-linked securities
Fair value is measured by models such as option model
(Closed form), DCF model, FDM and Monte Carlo
Simulation.
Values of underlying assets, market
rate, dividend, volatility, correlation
coefficient and foreign exchange
rate, etc.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 73 -
251
Valuation methods of financial assets and liabilities measured at fair value and classified into Level 3 and
significant but unobservable inputs are as follows:
Fair value
measurement
technique
Binomial tree, DCF
Type
Loans
Derivative assets Option valuation
model and others
Interest rate
related
Range
Impact of changes in significant
unobservable inputs on fair value
measurement
14.50%~46.06% Variation of fair value as volatility of
underlying asset increases.
0.90~0.98
Variation of fair value increases as
correlation coefficient increases.
16.30%~41.20% Variation of fair value increases as
volatility increases.
Input variable
Stock, Volatility
of underlying
asset
Correlation
coefficient
Volatility of
underlying
asset
Equity related Correlation
coefficient
0.237~0.675
Variation of fair value increases as
correlation coefficient increases.
DCF model
Currency
related
Credit risk
adjustment ratio
7.70%~100.00% Variation of fair value increases as
credit risk adjustment ratio increases.
Derivative
liabilities
Option valuation
model and others
Interest rate
related
Correlation
coefficient
0.90~0.98
Variation of fair value increases as
correlation coefficient increases.
Volatility of
underlying
asset
16.30%~41.20% Variation of fair value increases as
volatility increases.
Equity related Correlation
coefficient
0.237~0.675
Variation of fair value increases as
correlation coefficient increases.
Volatility of
underlying
21.40%~22.40% Variation of fair value increases as
volatility increases.
Equity-linked
securities
Monte Carlo Simulation and others Correlation
coefficient
Volatility of
underlying
asset
Equity
securities,
capital
contributions,
debt securities,
and beneficiary
certificates
External appraisal value and others Terminal growth
rate
Discount rate
Volatility of real
estate sale price
Volatility of
underlying
assets
0.294~0.675
19.10%~25.30%
Equity-linked securities’ variation of
fair value increases if both volatility
and correlation coefficient increase.
However, when correlation
coefficient decreases despite the
increase in volatility, the variation of
fair value of a compound financial
instrument may decrease.
Fair value increases as terminal
growth rate increases.
Fair value increases as discount rate
decreases.
Fair value increases as real estate sale
price increases.
13.21%~52.48% Variation of fair value increases as
0.35%~19.21%
0.00%~ 9.15%
0.00
volatility of underlying assets
increases
Fair value of financial assets and liabilities classified into Level 3 is measured by the Group using its own
valuation methods or using external specialists. Unobservable inputs used in the fair value measurements are
produced by the internal system of the Group and the appropriateness of inputs is reviewed regularly.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 252
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(3) Changes in financial assets and liabilities measured at fair value classified into Level 3 are as follows (Unit:
Korean Won in millions):
January 1,
2019
Business
combination
Net Income
(loss)
(*1)
Other
comprehens
-ive income
Purchases/
issuances
Disposals/
settlements
Transfer to
or out Level
3 (*2)
December
31, 2019
For the year ended December 31, 2019
Financial assets:
Financial assets at fair
value through profit or
loss mandatorily
measured at fair value
Debt securities
Equity securities
Capital contributions
Beneficiary certificates
Loans
Derivative assets
Sub-total
Financial assets at FVTOCI
Equity securities
Total
Financial liabilities:
Financial liabilities at fair
value through profit or
loss mandatorily
measured at fair value
Derivative liabilities
(Designated for trading)
Financial liabilities at fair
value through profit or
loss designated as upon
initial recognition
Equity-linked securities
Derivatives liabilities
(designated for hedging)
Total
8,389
401,860
422,614
854,299
180,450
48,798
1,916,410
468,847
2,385,257
16,691
164,767
-
181,458
-
-
707
-
-
-
707
476
59,537
(13,270)
18,450
6,854
16,935
88,982
-
-
-
-
-
-
-
1,408
2,115
-
88,982
23,063
23,063
2,000
95,511
173,064
578,228
60,696
1,115
910,614
687
911,301
(5,039)
(28,287)
(67,916)
(183,684)
(95,371)
(40,343)
(420,640)
(306)
(420,946)
-
-
-
-
8,441
-
(1,457)
6,984
5,826
528,621
515,199
1,275,734
152,629
25,048
2,503,057
(1)
6,983
493,698
2,996,755
-
-
-
-
84,033
33,237
-
117,270
-
-
-
-
(11,140)
(14,817)
(2,728)
72,039
1,809
(112,187)
-
87,626
321
(9,010)
-
(127,004)
-
(2,728)
321
159,986
(*1) The losses that increase financial liabilities are presented as positive amounts, and the gains that decrease
financial liabilities are presented as negative amounts. The loss amounting to 21,809 million Won for the years
ended December 31, 2019, which is from financial assets and liabilities that the Group holds as at the end of the
periods, has been recognized in net gain (loss) on financial assets at FVTPL and net gain (loss) on financial
assets at FVTOCI in the consolidated statement of comprehensive income.
(*2) The Group recognizes transfers between levels at the end of reporting period within which events have occurred or
conditions have changed.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 75 -
253
January 1,
2018
Net Income
(loss)
(*1)
For the year ended December 31, 2018
Other
comprehensiv
-e income
Purchases/
issuances
Disposals/
settlements
Transfer to or
out of Level 3
(*2)
December
31, 2018
Financial assets:
Financial assets at fair
value through profit or
loss mandatorily
measured at fair value
Debt securities
Equity securities
Capital contributions
Beneficiary certificates
Loans
Derivative assets
Sub-total
Financial assets at
FVTOCI
Equity securities
Total
Financial liabilities:
Financial liabilities at fair
value through profit or
loss mandatorily
measured at fair value
Derivative liabilities
Financial liabilities at fair
value through profit or
loss designated as upon
initial recognition
Equity-linked securities
Total
9,694
280,171
294,121
654,066
165,001
19,346
1,422,399
(28)
56,271
16,119
16,391
3,378
75,696
167,827
-
-
-
-
-
-
-
3,000
67,953
144,207
5,151,535
150,103
4,722
5,521,520
(4,277)
(2,535)
(31,833)
(4,971,003)
(138,032)
(50,966)
(5,198,646)
-
-
-
3,310
-
-
3,310
8,389
401,860
422,614
854,299
180,450
48,798
1,916,410
451,287
1,873,686
-
167,827
19,688
19,688
432
5,521,952
(2,560)
(5,201,206)
-
3,310
468,847
2,385,257
20,951
46,409
160,057
181,008
(16,243)
30,166
-
-
-
255
(50,921)
(3)
16,691
183,039
183,294
(162,086)
(213,007)
-
(3)
164,767
181,458
(*1) The losses that increase financial liabilities are presented as positive amounts, and the gains that decrease financial
liabilities are presented as negative amounts. The gain amounting to 137,777 million Won for the years ended
December 31, 2018, which is from financial assets and liabilities that the Group holds as at the end of the periods,
has been recognized in net gain (loss) on financial assets at FVTPL and net gain (loss) on financial assets at
FVTOCI in the consolidated statement of comprehensive income.
(*2) The Group recognizes transfers between levels at the end of reporting period within which events have occurred or
conditions have changed.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 254
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(4) Sensitivity analysis on the unobservable inputs used for measuring Level 3 financial instruments
The sensitivity analysis of the financial instruments has been performed by classifying with favorable and
unfavorable changes based on how changes in unobservable assumptions would have effects on the fluctuations
of financial instruments’ value. When the fair value of a financial instrument is affected by more than one
unobservable assumption, the below table reflects the most favorable or the most unfavorable changes which
resulted from varying the assumptions individually. The sensitivity analysis was performed for two types of
level 3 financial instruments: (1) interest rate related derivatives, currency related derivatives, equity related
derivatives, equity-linked securities beneficiary certificates and loans of which fair value changes are recognized
as net income; (2) equity securities of which fair value changes are recognized as other comprehensive income.
Among the financial instruments that are classified as Level 3 amounting to 3,156,741 million Won and
2,566,715 million Won as of December 31, 2019 and 2018 respectively, investments of 2,194,320 million Won
and 1,641,875 million Won that are considered to provide the best estimate of fair value are excluded from the
sensitivity analysis.
The following table presents the sensitivity analysis to disclose the effect of reasonably possible volatility on the
fair value of a Level 3 financial instruments (Unit: Korean Won in millions):
Financial assets:
Financial assets at fair value through profit
or loss mandatorily measured at fair value
Derivative assets (*1)
Loans (*2)
Debt securities
Equity securities (*3) (*4)
Beneficiary certificates (*4)
Financial assets at FVTOCI
Equity securities (*3) (*4)
Total
Financial liabilities:
Financial liabilities at fair value through
profit or loss mandatorily measured at fair
value
Derivative liabilities (*1)
Financial liabilities at FVTPL designated
as upon initial recognition
Equity-linked securities (*1)
Total
December 31, 2019
Net income (loss)
Other comprehensive income
(loss)
Favorable
Unfavorable
Favorable
Unfavorable
640
152
652
16,104
1,125
-
18,673
1,054
136
1,190
(935)
(128)
(640)
(10,929)
(1,125)
-
(13,757)
(816)
(142)
(958)
-
-
-
-
-
-
-
-
-
-
26,380
26,380
(11,981)
(11,981)
-
-
-
-
-
-
(*1) Fair value changes of equity related derivatives assets and liabilities and equity-linked securities are calculated by
increasing or decreasing historical volatility of the stock price and correlation, which are major unobservable
variables, by 10%, respectively. In the case of interest rate related derivative assets and liabilities, fair value
changes are calculated by increasing or decreasing the volatility of interest rate, which are major unobservable
variables, by 10%.
(*2) Fair value changes of equity securities are calculated by increasing or decreasing stock prices (-10%~10%) and
volatility (-10~10%) and discount rate. The stock prices, volatility, and discount rate are major unobservable
variables.
(*3) Fair value changes of equity securities are calculated by increasing or decreasing growth rate (0~1%) and
discount rate (-1~1%) or liquidation value (-1~1%). The growth rate, discount rate, and liquidation value are
major unobservable variables.
(*4) Even if the sensitivity analysis of the capital contributions and beneficiary certificates is not possible in practice,
fair value changes of beneficiary certificates and other securities whose major unobservable variables are
composed of the real estate are calculated by increasing or decreasing price fluctuation of real estate which is
underlying assets and discount rate by 1%.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 77 -
255
December 31, 2018
Net income (loss)
Other comprehensive income
(loss)
Favorable
Unfavorable
Favorable
Unfavorable
Financial assets:
Financial assets at fair value through profit
or loss mandatorily measured at fair value
Derivative assets (*1)
Loans
Debt securities
Equity securities (*2) (*3)
Beneficiary certificates (*3)
Financial assets at FVTOCI
Equity securities (*2) (*3)
Total
Financial liabilities:
Financial liabilities at fair value through
profit or loss mandatorily measured at fair
value
Derivative liabilities (*1)
Financial liabilities at fair value through
profit or loss designated as upon initial
recognition
Equity-linked securities (*1)
Total
4,578
146
68
12,700
1,582
-
19,074
(4,352)
(127)
(35)
(9,165)
(1,582)
-
(15,261)
-
-
-
-
-
-
-
-
-
-
23,798
23,798
(10,078)
(10,078)
2,433
(2,751)
1,561
3,994
(1,669)
(4,420)
-
-
-
-
-
-
(*1) Fair value changes of equity related derivatives assets and liabilities and equity-linked securities are calculated by
increasing or decreasing historical volatility of the stock price and correlation, which are major unobservable
variables, by 10%, respectively. In the case of interest rate related derivative assets and liabilities, fair value
changes are calculated by increasing or decreasing the volatility of interest rate, which are major unobservable
variables, by 10%.
(*2) Fair value changes of equity securities are calculated by increasing or decreasing growth rate (0~1%) and
discount rate or liquidation value (-1~1%). The growth rate, discount rate, and liquidation value are major
unobservable variables.
(*3) Even if the sensitivity analysis of the capital contributions and beneficiary certificates is not possible in practice,
fair value changes of beneficiary certificates and other securities whose major unobservable variables are
composed of the real estate are calculated by increasing or decreasing price fluctuation of real estate which is
underlying assets and discount rate by 1%.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 256
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(5) Fair value and carrying amount of financial assets and liabilities that are recorded at amortized cost are as
follows (Unit: Korean Won in millions):
Financial assets:
Securities at amortized cost
Loans and other financial assets at
amortized cost
Financial liabilities:
Deposits due to customers
Borrowings
Debentures
Other financial liabilities
Financial assets:
Securities at amortized cost
Loans and other financial assets at
amortized cost
Financial liabilities:
Deposits due to customers
Borrowings
Debentures
Other financial liabilities
December 31, 2019
Fair value
Level 1
Level 2
Level 3
Total
Book
value
3,123,898
17,378,920
-
20,502,818
20,320,539
25,902
54,507
283,058,699
283,139,108
293,717,693
-
-
-
-
264,909,974
18,919,018
31,173,189
17,693,559
-
-
-
-
264,909,974
18,919,018
31,173,189
17,693,559
264,685,578
18,998,920
30,858,055
17,706,767
December 31, 2018
Fair value
Level 1
Level 2
Level 3
Total
Book
value
3,618,213
19,417,130
-
23,035,343
22,932,559
-
-
-
-
-
-
282,342,760
282,342,760
282,457,578
248,763,952
16,203,070
28,765,251
21,461,397
-
-
-
-
248,763,952
16,203,070
28,765,251
21,461,397
248,690,939
16,202,986
28,735,862
21,442,524
The fair values of financial instruments are measured using quoted market price in active markets. In case
there is no active market for financial instruments, the Group determines the fair value by using valuation
methods. Valuation methods and input variables for financial assets and liabilities that are measured at
amortized cost are given as follows:
Securities at amortized cost
Valuation methods
The fair value is measured by discounting the projected
cash flows of debt securities by applying the market
discount rate that has been applied to a proxy company
that has similar credit rating to the issuers of the
securities.
Input variables
Risk-free market rate,
credit spread,
prepayment rate,
etc.
Loans and other financial
assets at amortized cost
The fair value is measured by discounting the projected
cash flows of loan products by applying the market
discount rate that has been applied to a proxy company
that has similar credit rating to the debtor.
Risk-free market rate,
credit spread,
prepayment rate,
etc.
Deposits due to customers,
borrowings, debentures and
other financial liabilities
The fair value is measured by discounting the projected
cash flows of debt products by applying the market
discount rate that is reflecting credit rating of the Group.
Risk-free market rate,
forward rate, etc.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 79 -
257
(6) Financial instruments by category
Carrying amounts of financial assets and liabilities by each category are as follows (Unit: Korean Won in
millions):
Financial assets
Deposits
Securities
Loans
Derivative assets
Other financial assets
Total
December 31, 2019
Financial asset at
FVTPL
Financial assets
at FVTOCI
27,901
4,906,867
212,473
2,921,903
-
8,069,144
-
27,730,531
-
-
-
27,730,531
Financial assets
at amortized cost
14,492,223
20,320,539
271,032,244
-
8,193,226
314,038,232
December 31, 2019
Derivatives
assets
(Designated for
hedging)
-
-
-
121,131
-
121,131
Total
14,520,124
52,957,937
271,244,717
3,043,034
8,193,226
349,959,038
Financial liabilities
Deposits due to customers
Borrowings
Debentures
Derivative liabilities
Other financial liabilities (*)
Total
Financial liabilities
at FVTPL
27,530
87,626
-
2,843,146
-
2,958,302
Financial liabilities
at amortized cost
264,685,578
18,998,920
30,858,055
-
17,769,531
332,312,084
Derivatives
liabilities
(Designated for
hedging)
-
-
-
6,837
-
6,837
Total
264,713,108
19,086,546
30,858,055
2,849,983
17,769,531
335,277,223
(*) Other financial liabilities include 62,764 million Won of financial guarantee liabilities measured at amortized cost
included in provisions.
Financial assets
Deposits
Securities
Loans
Derivative assets
Other financial assets
Total
December 31, 2018
Financial asset at
FVTPL
Financial assets
at FVTOCI
26,935
3,687,852
385,450
2,026,079
-
6,126,316
-
18,063,423
-
-
-
18,063,423
Financial assets
at amortized cost
14,151,012
22,932,559
260,819,917
-
7,486,649
305,390,137
December 31, 2018
Derivatives
assets
(Designated for
hedging)
-
-
-
35,503
-
35,503
Total
14,177,947
44,683,834
261,205,367
2,061,582
7,486,649
329,615,379
Financial liabilities
Deposits due to customers
Borrowings
Debentures
Derivative liabilities
Other financial liabilities(*)
Total
Financial liabilities
at FVTPL
27,058
164,767
-
2,090,861
-
2,282,686
Financial liabilities
at amortized cost
248,690,939
16,202,986
28,735,862
-
21,490,341
315,120,128
Derivatives
liabilities
(Designated for
hedging)
-
-
-
51,408
-
51,408
Total
248,717,997
16,367,753
28,735,862
2,142,269
21,490,341
317,454,222
(*) Other financial liabilities include 47,817 million Won of financial guarantee liabilities measured at amortized cost
included in provisions.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 258
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(7)
Income or expense from financial instruments by category
Income or expense from financial assets and liabilities by each category during the years ended December 31,
2019 and 2018 are as follows (Unit: Korean Won in millions):
December 31, 2019
Interest
Income(expense)
50,277
474,751
436,340
Fees and
Commissions
Income(expense)
89,817
-
-
9,615,060
-
(4,682,722)
-
-
5,893,706
296,435
-
-
-
71,106
457,358
Provision
(reversal) of
credit loss
-
(3,297)
1,415
(385,758)
-
Others
112,434
31,995
-
102,115
-
Total
252,528
503,449
437,755
9,627,852
-
-
-
(4,682,722)
-
13,396
(374,244)
36,982
-
283,526
36,982
84,502
6,260,346
December 31, 2018
Interest
Income(expense)
54,243
280,371
376,788
Fees and
Commissions
Income(expense)
86,845
66
-
8,973,097
(3,164)
(4,030,384)
-
-
5,650,951
317,316
-
27,742
-
-
431,969
Provision
(reversal) of
credit loss
-
(2,027)
(1,922)
(415,084)
-
Others
264,850
24,707
431
79,101
17,485
Total
405,938
303,117
375,297
8,954,430
14,321
-
25,498
(3,977,144)
-
89,459
(329,574)
(672)
-
411,400
(672)
89,459
6,164,746
Financial assets at FVTPL
Financial assets at FVTOCI
Securities at amortized cost
Loans and other financial
assets at amortized cost
Financial liabilities at FVTPL
Financial liabilities at
amortized cost
Net derivatives (designated
for hedging)
Off-balance provisions
Total
Financial assets at FVTPL
Financial assets at FVTOCI
Securities at amortized cost
Loans and other financial
assets at amortized cost
Financial liabilities at FVTPL
Financial liabilities at
amortized cost
Net derivatives (designated
for hedging)
Off-balance provisions
Total
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 81 -
259
12. DERECOGNITION AND OFFSET OF FINANCIAL INSTRUMENTS
(1) Derecognition of financial instruments
Transferred financial assets that do not meet the condition of derecognition in their entirety.
1) Bonds sold under repurchase agreements
The financial instruments that were disposed but the Group agreed to repurchase at the fixed amounts at the
same time, so that they did not meet the conditions of derecognition, are as follows (Unit: Korean Won in
millions):
December 31,
2019
December 31,
2018
Assets
transferred
Financial assets at FVTPL
Financial assets at FVTOCI
Securities at amortized cost
Loans and other financial assets at
amortized cost
Related liabilities
Total
Bonds sold under repurchase agreements
407,985
56,975
42,841
82,594
590,395
569,002
-
33,588
5,552
-
39,140
42,907
2)
Securities loaned
When the Group loans its securities to outside parties, the legal ownerships of the securities are transferred;
however, they should be returned at the end of lending period. Therefore, the Group does not derecognize
them from the consolidated financial statements as it owns majority of risks and benefits from the securities
continuously, regardless of the transfer of legal ownership. The carrying amounts of the securities loaned
are as follows (Unit: Korean Won in millions):
Financial assets
at FVTOCI
Korean financial
institution’s debt
securities and others
Total
December 31, 2019
December 31, 2018
80,737
80,737
40,029
40,029
Loaned to
Korea Securities
Finance
Corporation
The details of the transferred financial assets that do not meet the conditions of derecognition in their
entirety, such as disposal of securities under repurchase agreement or securities loaned, are explained in
Note 18. The Group does not have continuing involvement in transferred financial assets.
(2) The offset of financial assets and liabilities
The Group possesses both the uncollected domestic exchange receivables and the unpaid domestic exchange
payable, which satisfy offsetting criteria of K-IFRS 1032. Therefore, the total number of uncollected domestic
exchange receivables or unpaid domestic exchange payable has been offset with part of unpaid domestic
exchange payable or uncollected domestic exchange receivables and has been disclosed in loans at amortized
cost and other financial assets and other financial liabilities of the Group’s statements of financial position
respectively.
The Group possesses the derivative assets, derivative liabilities, receivable spot exchange and payable spot
exchange that do not satisfy the offsetting criteria of K-IFRS 1032, but provide the Group under the
circumstances of the trading party’s defaults, insolvency or bankruptcy, with the right of offsetting. Items such as
cash collateral cannot satisfy the offsetting criteria of K-IFRS 1032, but in accordance with the collateral
arrangements and under the circumstances of the trading party’s default, insolvency or bankruptcy, the net
amount of derivative assets and derivative liabilities, receivable spot exchange and payable spot exchange can be
offset.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
260
- 82 -
The Group has entered into a resale and repurchase agreement and accounted it as a collateralized borrowing.
The Group has also entered into a resale and purchase agreement and accounted it as a secured loans. The Group
under the repurchase agreements has an offsetting right only upon the counterparty’s default, insolvency or
bankruptcy; thus, the repurchase agreements are applied by the TBMA/ISMA Global Master Repurchase
Agreement, which does not satisfy the offsetting criteria of K-IFRS 1032. The Group disclosed bonds sold under
repurchase agreements as borrowings and bonds purchased under resale agreements as loan at amortized cost
and other financial assets.
As of December 31, 2019 and 2018, the financial instruments to be off set and may be covered by master netting
agreements and similar agreements are as follows (Unit: Korean Won in millions):
Gross
amounts of
recognized
financial
assets
3,032,894
5,112,206
8,981,752
Gross
amounts of
recognized
financial
assets
setoff
-
-
-
December 31, 2019
Related amounts not setoff
in the consolidated
statement of financial
position
Netting
agreements
and others
Cash
collateral
received
Net
amounts
7,058,885
111,122
975,093
Net
amounts
of financial
assets
presented
3,032,894
5,112,206
8,981,752
8,981,752
-
-
31,642,486 31,269,258
48,769,338 31,269,258
373,228
17,500,080
-
16,040,637
-
111,122
373,228
1,348,321
2,824,449
87,626
5,111,386
569,002
-
-
-
-
2,824,449
87,626
5,111,386
7,071,549
172,488
779,424
569,002
180,402
388,600
-
32,531,186 31,269,258
41,123,649 31,269,258
1,261,928
9,854,391
1,257,280
8,509,231
-
561,088
4,648
784,072
Financial assets:
Derivative assets (*1)
Receivable spot exchange (*2)
Bonds purchased under resale
agreements (*2)
Domestic exchange settlement
credits (*2)(*6)
Total
Financial liabilities:
Derivative liabilities (*1)
Equity-linked securities in short
position (*3)
Payable spot exchange (*4)
Bonds sold under repurchase
agreements (*5)
Domestic exchange settlement debits
(*4)(*6)
Total
(*1) The items include derivatives held for trading, derivatives designated for hedging.
(*2) The items are included in loan at amortized cost and other financial assets.
(*3) The items are equity linked securities related to derivatives and are included in financial liabilities at FVTPL.
(*4) The items are included in other financial liabilities.
(*5) The items are included in borrowings.
(*6) Certain financial assets and liabilities are presented as net amounts.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 83 -
261
Gross
amounts of
recognized
financial
assets
1,908,542
4,200,532
11,701,951
Gross
amounts of
recognized
financial
assets
setoff
-
-
-
December 31, 2018
Related amounts not setoff
in the consolidated
statement of financial
position
Netting
agreements
and others
Cash
collateral
received
Net
amounts
5,527,117
66,857
515,100
Net
amounts
of financial
assets
presented
1,908,542
4,200,532
11,701,951
11,701,951
-
-
30,090,598 29,699,412
47,901,623 29,699,412
391,186
18,202,211
-
17,229,068
-
66,857
391,186
906,286
1,862,681
164,767
4,206,027
42,907
-
-
-
-
1,862,681
164,767
4,206,027
5,540,147
115,615
577,713
42,907
42,907
-
-
36,832,774 29,699,412
43,109,156 29,699,412
7,133,362
13,409,744
6,231,538
11,814,592
-
901,824
115,615 1,479,537
Financial assets:
Derivative assets (*1)
Receivable spot exchange (*2)
Bonds purchased under resale
agreements (*2)
Domestic exchange settlement
credits (*2)(*6)
Total
Financial liabilities:
Derivative liabilities (*1)
Equity-linked securities index in
short position (*3)
Payable spot exchange (*4)
Bonds sold under repurchase
agreements (*5)
Domestic exchange settlement debits
(*4)(*6)
Total
(*1) The items include derivatives held for trading, derivatives designated for hedging.
(*2) The items are included in loan at amortized cost and other financial assets.
(*3) The items are equity linked securities related to derivatives and are included in financial liabilities at FVTPL.
(*4) The items are included in other financial liabilities.
(*5) The items are included in borrowings.
(*6) Certain financial assets and liabilities are presented as net amounts.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 262
- 84 -
13. INVESTMENTS IN JOINT VENTURES AND ASSOCIATES
(1)
Investments in joint ventures and associates accounted for using the equity method of accounting are as
follows:
Joint ventures and associates
Main business
Woori Bank:
Woori Service Networks Co., Ltd.
(*1)
Korea Credit Bureau Co., Ltd. (*2)
Freight & staffing
services
Credit information
Korea Finance Security Co., Ltd.
Security service
(*1)
Saman Corporation (*2)
Wongwang Co., Ltd. (*4)
Sejin Construction Co., Ltd. (*4)
ARES-TECH Co., Ltd. (*4)
General construction
Technology service
Wholesale and real
estate
Construction
Electronic
component
manufacturing
Other services
Reading Doctors Co., Ltd. (*4)
Cultizm Korea LTD Co., Ltd. (*4) Wholesale and retail
NK Eng Co., Ltd. (*4)
Woori Growth Partnerships New
Technology Private Equity Fund
Bank
2016KIF-IMM Woori
Technology Venture Fund
K BANK Co., Ltd. (*2)
Smart Private Equity Fund No.2
Woori Bank-Company K Korea
Movie Asset Fund
Well to Sea No. 3 Private Equity
Fund (*7)
Partner One Value Up I Private
Equity Fund
IBK KIP Seongjang Dideemdol 1st
Investment Limited
Private
Partnership
Crevisse Raim Impact 1st Startup
Venture Specialist Private Equity
Fund
LOTTE CARD Co., Ltd. (*8)
Japanese Hotel Real Estate Private
Equity Fund 2 (*8)
Woori Investment Bank Co., Ltd.:
sales
Manufacturing
Other financial
services
Other financial
services
Finance
Other financial
services
Other financial
services
Finance
Other financial
services
Other financial
services
Other financial
services
Credit card and
installment financing
Other financial
services
Percentage of ownership (%)
December 31,
December 31,
2018
2019
Location
Financial
statements as of
4.9
9.9
15.0
9.2
29.0
29.6
23.4
35.4
31.3
23.1
23.1
20.0
14.5
20.0
25.0
50.0
23.3
20.0
25.0
20.0
19.9
4.9
9.9
Korea
Korea
15.0
Korea
9.2
Korea
29.0
29.6
23.4
35.4
31.3
23.1
Korea
Korea
Korea
Korea
Korea
Korea
23.1
Korea
20.0
Korea
14.1
Korea
20.0
Korea
25.0
Korea
50.0
Korea
23.3
Korea
20.0
Korea
25.0
Korea
-
-
Korea
Korea
November 30,
2019(*5)
December
31,2019
November
30,2019 (*5)
September
30,2019(*5)
-
-
-
-
-
-
December
31,2019
December
31,2019
November
30,2019 (*5)
December
31,2019
December
31,2019
September
30,2019(*5)
December
31,2019
December
31,2019
December
31,2019
September
30,2019(*5)
October
31,2019(*5)
Nomura-Rifa Private Real Estate
Investment Trust No.17 (*6)
Other financial
services
-
19.4
Korea
-
Woori
Private
Equity Asset
Management Co., Ltd.:
Uri Hanhwa Eureka Private Equity
Fund
Japanese Hotel Real Estate Private
Equity Fund 1:
Godo Kaisha Oceanos 1 (*8)
Woori bank and Woori card Co., Ltd.:
Other financial
services
Other financial
services
0.8
0.8
Korea
47.8
-
Japan
December
31,2019
October
31,2019(*5)
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 85 -
263
Percentage of ownership (%)
December 31,
December 31,
2018
2019
Location
Korea
Financial
statements as of
-
24.5
Joint ventures and associates
Dongwoo C & C Co., Ltd. (*4)
SJCO Co., Ltd. (*4)
G2 Collection Co., Ltd. (*4)
The Base Enterprise Co., Ltd. (*4)
Kyesan Engineering Co., Ltd. (*4)
Good Software Lap Co., Ltd. (*4)
QTS Shipping Co., Ltd. (*4)
DAEA SNC Co., Ltd. (*4)
Main business
Construction
Aggregate
transportation and
wholesale
Wholesale and retail
sales
Manufacturing
Construction
Service
Complex
transportation
brokerage
Wholesale and retail
sales
Manufacturing
Manufacturing
Manufacturing
Plating
Manufacturing
Force TEC Co., Ltd. (*4)
Sinseong Trading Co., Ltd. (*4)
PREXCO Co., Ltd. (*4)
Jiwon Plating Co., Ltd. (*4)
Gil Co.,Ltd. (*6)
Youngdong Sea Food Co., Ltd. (*4) Processed sea food
Woori Bank , Woori Investment Bank
Co., Ltd. and Woori Private Equity
Asset Management Co., Ltd.:
Woori-Shinyoung
Growth-Cap
Private Equity Fund I (*8)
Woori Bank and Woori Investment
Bank Co., Ltd.:
manufacturing
Other financial
services
Chin Hung International Inc. (*3)
Construction
PCC-Woori LP Secondary Fund
(*8)
Other financial
services
Woori Bank and Woori Private Equity
Asset Management Co., Ltd.:
Woori-Q Corporate Restructuring
Private Equity Fund (*8)
Trust and collective
investment
24.5
28.7
29.2
48.4
23.3
29.4
49.8
25.5
25.8
27.9
28.1
20.8
-
24.5
26.5
Korea
28.9
48.4
23.3
29.4
Korea
Korea
Korea
Korea
49.4
Korea
24.0
25.8
27.2
28.1
20.8
26.1
Korea
Korea
Korea
Korea
Korea
Korea
24.0
Korea
-
-
-
-
-
-
-
-
-
-
-
-
-
31.9
-
Korea
25.3
38.8
38.4
25.3
Korea
-
-
Korea
Korea
December
31,2019
November
30,2019 (*5)
December
31,2019
December
31,2019
(*1) Most of the significant business transactions of associates are with the Group as of December 31, 2019 and 2018.
(*2) The Group can participate in decision-making body and exercise significant influence over financial policies and
operational policies decision making of the associates.
(*3) Equity securities that have published market price among investment assets of associates are common shares of
Chin Hung International Inc. Quoted market prices of Chin Hung International Inc. are 2,310 Won and 2,065
Won as of December 31, 2019 and 2018, respectively.
(*4) There is no investment balance as of December 31, 2019 and 2018.
(*5) The equity method was applied using the most recent financial statements available from the settlement date
because no financial statements were available at the end of December and the significant transactions or events
that occurred between the end of the reporting period of the associate and the end of the reporting period of the
subsidiary were duly reflected.
(*6) The entity was excluded from the associate as the group sold its entire stake during the year ended December 31,
2019.
(*7) The Group has signed a contract that the Group (or the third party designated by the Group) has the priority to
purchase the underlying assets (Aju Capital Co. Ltd.) when it is disposed by Well to Sea No. 3 Private Equity
Fund.
(*8) Due to capital contribution by the Group for the year ended December 31, 2018, the entities have been included
in and associates.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 264
- 86 -
(2) Changes in the carrying value of investments in joint ventures and associates accounted for using the equity
method of accounting are as follows (Unit: Korean Won in millions):
Woori Service Networks Co.,
Ltd.
Korea Credit Bureau Co., Ltd.
Korea Finance Security Co.,
Ltd.
Chin Hung International Inc.
Saman Corporation
Woori Growth Partnerships
New Technology Private
Equity Fund
2016KIF-IMM Woori Bank
Technology Venture Fund
K BANK Co., Ltd.
Smart Private Equity Fund
No.2
Woori Bank-Company K
Korea Movie Asset Fund
Well to Sea No.3 Private
Equity Fund
Partner One Value Up I
Private Equity Fund
IBK KIP Seongjang
Dideemdol 1st Private
Investment Limited
Partnership
Crevisse Raim Impact 1st
Startup Venture Specialist
Private Equity Fund
Woori-Shinyoung Growth-
Cap Private Equity Fund I
LOTTE CARD Co.,Ltd
Woori-Q Corporate
Restructuring Private Equity
Fund
PCC-Woori LP Secondary
Fund
Nomura-Rifa Private Real
Estate Investment Trust
No.17
Uri Hanhwa Eureka Private
Equity Fund
Godo Kaisha Oceanos 1
Japanese Hotel Real Estate
Private Equity Fund 2
Acquisiti-
on cost
January 1,
2019
Share of
profits (losses)
Acquisi-
tion
Disposal
and others
Dividends
Change in
capital
December
31, 2019
For the year ended December 31, 2019
108
3,313
3,267
130,779
8,521
157
6,790
3,456
44,741
1,014
31
190
(169)
6,426
(198)
-
-
-
-
-
-
-
-
-
-
(2)
(135)
-
-
-
-
-
-
9
33
186
6,845
3,287
51,176
849
18,666
25,091
1,466
309
(7,490)
(164)
-
19,212
12,385
73,150
2,915
3,000
15,300
43,709
2,890
2,700
1,193
(18,233)
-
5,807
(41)
623
101,483
197,393
30,343
10,000
9,948
(40)
-
-
-
-
-
-
150
1,350
(824)
63,444
12,665
346,000
(83)
6,129
-
2,525
4,576
4,426
4,375
3,025
12,665
346,000
6,129
2,525
1,000
350
10,870
-
-
-
-
787
339
-
(2,615)
-
(85)
-
-
-
-
-
-
-
-
-
-
-
-
-
1,263
(29)
15,141
31,254
-
-
2,764
3,323
(18,836)
123
209,023
-
-
-
-
-
-
-
-
-
(105)
-
-
-
-
-
-
-
-
-
200
-
1,599
9,908
4,576
4,375
11,841
409,444
6,046
2,525
-
342
10,952
3,291
806,360
(136)
-
3
2
-
10,870
(651)
-
(15)
3,291
759,368
-
361,766
-
83,997
3,291
389,096
-
(10,856)
-
(19,242)
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Acquisiti-
on cost
175,652
January 1,
2018
98,933
Share of
profits
(losses)
(10,451)
108
158
1
3,313
5,816
1,087
3,267
3,519
(10)
Kumho Tire Co., Inc.
Woori Service Networks
Co., Ltd.
Korea Credit Bureau Co.,
Ltd.
Korea Finance Security
Co., Ltd.
Chin Hung International
Inc.
130,779
45,101
1,206
13,916
50,760
8,521
-
6,947
1,254
-
(816)
(98)
- 87 -
For the year ended December 31, 2018
Acquisi-
tion
-
-
-
-
-
-
-
-
Disposal
and others
(*)
(83,286)
Dividends
-
Change in
capital
(5,196)
-
-
-
-
-
(5,865)
-
(2)
(113)
(54)
-
-
1
-
-
-
-
(1,725)
-
(266)
35
Impair-
ment
-
-
-
-
-
-
-
(177)
Poonglim Industrial Co.,
Ltd.
STX Corporation
Saman Corporation
Woori Growth
Partnerships New
Technology Private
Equity Fund
2016KIF-IMM Woori
Bank Technology
Venture Fund
K BANK Co., Ltd.
Smart Private Equity
Fund No.2
Woori Bank-Company K
Korea Movie Asset
Fund
Well to Sea No.3 Private
Partner One Value Up Ist
Private Equity Fund
IBK KIP Seongjang
Dideemdol 1st Private
Investment Limited
Partnership
Crevisse Raim Impact 1st
Startup Venture
Specialist Private Equity
Fund
Nomura-Rifa Private Real
Estate Investment Trust
No.17
Uri Hanhwa Eureka
Private Equity Fund
Equity Fund
101,992
182,309
22,546
25,847
27,611
950
360
(3,346)
(484)
-
15,000
67,343
6,840
31,735
-
(10,705)
8,160
21,951
3,000
2,932
(42)
3,000
2,957
(257)
-
-
-
10,000
4,426
3,025
-
-
-
(52)
10,000
-
-
4,426
3,025
1,000
939
(152)
-
-
-
-
-
-
-
-
-
300
144
-
-
(508)
(517)
(6,437)
-
-
-
-
-
-
-
-
-
-
-
-
265
December
31, 2018
-
Others
-
-
-
-
157
6,790
3,456
159
44,741
-
-
-
-
-
584
-
-
-
-
-
-
-
-
-
1,014
25,091
15,300
43,709
2,890
2,700
197,393
9,948
4,426
3,025
787
-
-
-
-
-
-
-
-
-
-
350
621,299
-
417,051
(11)
3,196
350
48,272
-
(93,005)
-
(1,170)
-
(13,144)
-
(177)
-
743
339
361,766
(*) The amount transferred from the investments in joint ventures and associates to financial assets at FVTOCI is 83,286
million Won.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 266
- 88 -
(3) Summary financial information relating to investments in joint ventures and associates accounted for using
the equity method of accounting is as follows (Unit: Korean Won in millions):
December 31, 2019
Assets
Liabilities
Operating
revenue
Net income
(loss)
Woori Service Networks Co., Ltd.
Korea Credit Bureau Co., Ltd.
Korea Finance Security Co., Ltd.
Chin Hung International Inc.
Saman Corporation
Woori Growth Partnerships New Technology Private
Equity Fund
2016KIF-IMM Woori Bank Technology Venture Fund
K BANK Co., Ltd.
Smart Private Equity Fund No.2
Woori Bank-Company K Korea Movie Asset Fund
Well to Sea No.3 Private Equity Fund
Partner One Value Up I Private Equity Fund
IBK KIP Seongjang Dideemdol 1st Private Investment
5,742
96,855
32,574
335,147
92,206
83,583
72,768
2,679,968
13,872
13,294
7,073,363
42,602
1,969
30,289
10,660
229,764
66,184
330
343
2,464,168
51
2
6,470,540
-
17,572
91,200
61,939
499,152
91,088
7,866
8,939
84,928
2
4,532
524,319
457
1,322
1,480
(1,265)
26,617
(485)
6,355
7,462
(89,779)
(204)
2,492
48,357
(175)
Limited Partnership
21,208
691
766
(676)
Crevisse Raim Impact 1st Startup Venture Specialist
Private Equity Fund
Woori-Shinyoung Growth-Cap Private Equity Fund I
LOTTE CARD Co.,Ltd (*)
Woori-Q Corporate Restructuring Private Equity Fund
PCC-Woori LP Secondary Fund
Uri Hanhwa Eureka Private Equity Fund
Godo Kaisha Oceanos 1
Japanese Hotel Real Estate Private Equity Fund 2
16,939
37,642
12,936,977
15,975
6,498
41,950
70,869
16,561
124
620
10,659,889
823
-
236
47,960
6
10
2
1,366,512
-
-
41
778
-
(494)
(2,679)
42,538
(823)
(2)
(436)
119
(600)
(*) The amount is after reflecting the fair value adjustment that occurred when acquiring the shares and the adjustments
that occurred by difference of accounting policies with the Group.
December 31, 2018
Assets
Liabilities
Operating
revenue
Net income
(loss)
Woori Service Networks Co., Ltd.
Korea Credit Bureau Co., Ltd.
Korea Finance Security Co., Ltd.
Chin Hung International Inc.
Saman Corporation
Woori Growth Partnerships New Technology Private
Equity Fund
2016KIF-IMM Woori Bank Technology Venture Fund
K BANK Co., Ltd.
Smart Private Equity Fund No.2
Woori Bank-Company K Korea Movie Asset Fund
Well to Sea No.3 Private Equity Fund
Partner One Value Up Ist Private Equity Fund
IBK KIP Seongjang Dideemdol 1st Private Investment
Limited Partnership
Crevisse Raim Impact 1st Startup Venture Specialist
Private Equity Fund
Nomura-Rifa Private Real Estate Investment Trust
No.17
Uri Hanhwa Eureka Private Equity Fund
5,066
88,797
35,155
412,205
97,720
109,167
73,231
2,024,856
14,502
10,805
5,968,591
42,776
21,200
12,014
20,197
42,332
1,886
22,788
12,114
332,268
69,915
440
12
1,807,502
51
5
5,395,307
-
757
105
16,178
181
15,803
78,018
60,706
606,192
75,825
5,943
16
60,039
1
1,663
429,742
326
819
9,901
17
6,402
(869)
4,117
(1,510)
(69,256)
(209)
(299)
39,711
(224)
390
(1,268)
3
10
1
(191)
(228)
(1,349)
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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267
(4) The entities that the Group has not applied equity method of accounting although the Group’s ownership
interest is more than 20% as of December 31, 2019 and 2018, are as follows:
Associate (*)
Orient Shipyard Co., Ltd.
Saenuel Co., Ltd.
E Mirae Tech Co., Ltd.
Jehin Trading Co., Ltd.
The Season Company Co., Ltd.
Yuil PESC Co., Ltd.
CL Tech Co., Ltd.
Associate (*)
Orient Shipyard Co., Ltd.
Saenuel Co., Ltd.
E Mirae Tech Co., Ltd.
Jehin Trading Co., Ltd.
The Season Company Co., Ltd.
Yuil PESC Co., Ltd.
CL Tech Co., Ltd.
December 31, 2019
Ownership (%)
Number of shares owned
464,812
3,531
7,837
83,056
18,283
8,642
13,759
December 31, 2018
Ownership (%)
Number of shares owned
464,812
3,531
7,696
81,610
18,187
8,642
13,759
21.4
37.4
41.8
27.7
30.3
24.0
38.6
21.4
37.4
41.0
27.3
30.1
24.0
38.6
(*) Even though the Group’s ownership interest of the entity is more than 20%, the Group does not have significant
influence over the entity since it is going through work-out process under receivership, thus it is excluded from
the investment in joint ventures and associates.
(5) As of December 31, 2019 and 2018, the reconciliations from the net assets of the associates to the book
value of the shares of the investment in joint ventures and associates are as follows (Unit: Korean Won in
millions except for ownership):
Total net
asset
Ownership
(%)
Ownership
portion of
net assets
Basis
difference
Impairment
Intercompany
transaction
Book
value
December 31, 2019
Woori Service Networks Co.,
Ltd.
Korea Credit Bureau Co., Ltd.
Korea Finance Security Co.,
Ltd.
Chin Hung International Inc.
(*1)
Saman Corporation
Woori Growth Partnerships
New Technology Private
Equity Fund
2016KIF-IMM Woori Bank
Technology Venture Fund
K BANK Co., Ltd. (*1) (*2)
Smart Private Equity Fund No.2
Woori Bank-Company K Korea
Movie Asset Fund
Well to Sea No.3 Private Equity
Fund (*1)
Partner One Value Up Ist
Private Equity Fund
IBK KIP Seongjang Dideemdol
1st Private Investment Limited
Partnership
Crevisse Raim Impact 1st
Startup Venture Specialist
Private Equity Fund
Woori-Shinyoung Growth-Cap
Private Equity Fund I
LOTTE CARD Co., Ltd (*1)
3,773
66,566
21,914
105,383
26,022
83,253
72,425
215,800
13,821
13,292
418,250
42,602
4.9
9.9
15.0
25.3
9.2
23.1
20.0
14.5
20.0
25.0
50.0
23.3
186
6,597
3,287
26,646
2,391
19,215
14,485
31,248
2,764
3,323
209,041
9,909
20,517
20.0
4,103
16,815
37,022
2,047,220
25.0
31.9
20.0
4,204
11,841
409,444
-
246
-
-
-
-
-
2
-
186
6,845
3,287
24,565
5,373
-
(6,915)
(35)
-
51,176
849
-
-
3,634
-
-
-
-
-
-
-
-
-
(3)
19,212
-
(3,634)
-
-
-
-
-
-
-
-
656
6
-
15,141
31,254
2,764
-
3,323
(18)
209,023
(1)
9,908
473
4,576
171
4,375
-
-
11,841
409,444
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 268
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Woori-Q Corporate
Restructuring Private Equity
Fund
PCC-Woori LP Secondary Fund
Uri Hanhwa Eureka Private
Equity Fund
Godo Kaisha Oceanos 1
Japanese Hotel Real Estate Private
Equity Fund 2
Total net
asset
Ownership
(%)
Ownership
portion of
net assets
Basis
difference
Impairment
Intercompany
transaction
Book
value
December 31, 2019
15,152
6,498
41,714
22,909
16,555
38.4
38.8
0.8
47.8
19.9
5,813
2,524
342
10,952
3,291
-
-
-
-
-
-
-
-
-
-
233
1
-
-
-
6,046
2,525
342
10,952
3,291
(*1) The net asset equity amount is after the debt-for-equity swap, non-controlling etc.
(*2) As a result of conducting an impairment test on the investment stocks of the related companies, the recoverable
value was less than the carrying amount and thus the impairment loss was recognized.
Total net
asset
Ownership
(%)
Ownership
portion of
net assets
Basis
difference
Impairment
Intercompany
transaction
Book
value
December 31, 2018
Woori Service Networks Co.,
Ltd.
Korea Credit Bureau Co., Ltd.
Korea Finance Security Co.,
Ltd.
Chin Hung International Inc. (*)
Saman Corporation
Woori Growth Partnerships
New Technology Private
Equity Fund
2016KIF-IMM Woori Bank
Technology Venture Fund
K BANK Co., Ltd.(*)
Smart Private Equity Fund No.2
Woori Bank-Company K Korea
Movie Asset Fund
Well to Sea No.3 Private Equity
Fund (*)
Partner One Value Up Ist
Private Equity Fund
IBK KIP Seongjang Dideemdol
1st Private Investment Limited
Partnership
Crevisse Raim Impact 1st
Startup Venture Specialist
Private Equity Fund
Nomura-Rifa Private Real
3,180
66,009
23,041
79,793
27,805
108,727
73,219
290,597
14,451
10,800
396,248
42,776
4.9
9.9
15.0
25.3
9.2
23.1
20.0
14.1
20.0
25.0
50.0
23.3
157
6,544
3,456
20,192
2,556
25,091
14,644
40,984
2,890
2,700
198,027
9,948
20,443
20.0
4,089
Estate Investment Trust No.17
4,019
Uri Hanhwa Eureka Private
Equity Fund
42,151
11,909
25.0
19.4
0.8
2,977
780
339
(*) The net asset equity amount is after the debt-for-equity swap.
-
246
-
24,565
5,373
-
-
2,725
-
-
-
-
-
-
-
-
-
-
-
-
(6,915)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(16)
-
157
6,790
3,456
44,741
1,014
-
25,091
656
-
-
15,300
43,709
2,890
-
2,700
(634)
197,393
-
9,948
337
4,426
48
3,025
7
-
787
339
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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269
14. INVESTMENT PROPERTIES
(1) Details of investment properties are as follows (Unit: Korean Won in millions):
December 31, 2019
December 31, 2018
Acquisition cost
Accumulated depreciation
Net carrying value
299,802
(19,563)
280,239
(2) Changes in investment properties are as follows (Unit: Korean Won in millions):
For the years ended December 31
2018
2019
Beginning balance (*)
Acquisition
Disposal
Depreciation
Transfers from(to) premises and equipment
Classified to assets held for sale
Foreign currencies translation adjustments
Others
Ending balance
178,910
70,346
(193)
(2,225)
32,394
-
402
605
280,239
416,796
(38,600)
378,196
371,301
15,195
(3,045)
(4,045)
7,623
(10,056)
(5)
1,228
378,196
(*) 199,286 million Won is deducted which was reclassified from the investment properties to premises and
equipment at the beginning of the period within the net carrying mount of the previous term.
(3) Fair value of investment properties amounted to 502,305 million Won and 438,534 million Won as of
December 31, 2019 and 2018, respectively. The fair value of investment properties has been assessed on
the basis of recent similar real estate market price and officially assessed land price in the area of the
investment properties, is classified as level 3 on the fair value hierarchy.
(4) Rental fee earned from investment properties is amounting to 10,106 million Won and 5,080 million Won
for the years ended December 31, 2019 and 2018, respectively. Operating expenses directly related to the
investment properties where rental fee was earned amounted to 3,010 million Won and 4,120 million Won.
(5) The lease payments expected to be received in the future under lease contracts as of December 31, 2019
and 2018 are as follows (Unit: Korean Won in millions):
Lease payments:
Within a year
More than 1 year and within 2 years
More than 2 years and within 3 years
More than 3 years and within 4 years
More than 4 years and within 5 years
More than 5 years
Total
December 31, 2019
December 31, 2018
6,574
4,924
4,018
3,618
3,126
241
22,501
5,454
3,702
3,009
2,619
2,222
-
17,006
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15. PREMISES AND EQUIPMENT
(1) Details of premises and equipment as of December 31, 2019 are as follows (Unit: Korean Won in millions):
Premises and
equipment(owned)
Right-of-use asset
Carrying value
Land
Building
Equipment
and vehicles
Leasehold
improvement
Construction
in progress
Structures
Total
December 31, 2019
1,761,159
-
1,761,159
802,299
449,878
1,252,177
278,016
17,236
295,252
54,839
-
54,839
1,287
-
1,287
2
-
2
2,897,602
467,114
3,364,716
(2) Details of premises and equipment(owned) as of December 31, 2019 and 2018 are as follows (Unit: Korean
Won in millions):
Acquisition cost
Accumulated depreciation
Net carrying value
Land
1,761,159
-
1,761,159
Building
1,063,756
(261,457)
802,299
Acquisition cost
Accumulated depreciation
Net carrying value
Land
1,481,871
-
1,481,871
Building
872,282
(210,370)
661,912
December 31, 2019
Equipment
and vehicles
1,123,101
(845,085)
278,016
Leasehold
improvement
463,181
(408,342)
54,839
Construction
in progress
1,287
-
1,287
Structures
20
(18)
2
Total
4,412,504
(1,514,902)
2,897,602
December 31, 2018
Equipment
and vehicles
1,031,431
(791,418)
240,013
Leasehold
improvement
446,264
(388,670)
57,594
Construction
in progress
9,099
-
9,099
Structures
20
(17)
3
Total
3,840,967
(1,390,475)
2,450,492
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 93 -
271
(3) Details of changes in premises and equipment are as follows (Unit: Korean Won in millions):
Beginning balance
Acquisitions
Disposals
Depreciation
Classified to assets held for
sale
Transfer
Foreign currencies
translation adjustments
Business combination
(Note 45)
Others
Ending balance
Land
1,481,871
186,303
(3,015)
-
Building
661,912
87,667
(2,245)
(30,766)
(21)
93,956
(74)
83,260
880
801
1,185
-
1,761,159
74
1,670
802,299
Beginning balance
Acquisitions
Disposals
Depreciation
Classified to assets held for
sale
Transfer
Foreign currencies
translation adjustments
Business combination
Others
Ending balance
Land
1,487,278
1,372
(29)
-
Building
680,846
14,701
-
(26,014)
(3,651)
(2,863)
(2,592)
(4,760)
(236)
-
-
1,481,871
(257)
-
(12)
661,912
For the year ended December 31, 2019
Equipment
and vehicles
240,013
119,474
(1,203)
(87,453)
Leasehold
improvement
57,594
28,788
(2,738)
(27,134)
Construction
in progress
9,099
7,315
-
-
Structures
3
-
-
(1)
Total
2,450,492
429,547
(9,201)
(145,354)
-
3,670
1,459
926
1,130
278,016
-
912
609
1
(3,193)
54,839
-
(14,886)
36
-
(277)
1,287
-
-
-
-
-
2
(95)
166,912
3,785
2,186
(670)
2,897,602
For the year ended December 31, 2018
Equipment
and vehicles
180,072
76,783
(5,192)
(76,171)
Leasehold
improvement
64,787
17,527
(737)
(32,162)
Construction
in progress
64,559
8,285
(187)
-
Structures
3
-
-
-
Total
2,477,545
118,668
(6,145)
(134,347)
-
63,432
(69)
969
189
240,013
-
-
-
(63,432)
323
661
7,195
57,594
(126)
-
-
9,099
-
-
-
-
-
3
(6,243)
(7,623)
(365)
1,630
7,372
2,450,492
(4) Details of right-of-use assets as of December 31, 2019 are as follows (Unit: Korean Won in millions):
Acquisition cost
Accumulated depreciation
Net carrying value
Building
615,201
(165,323)
449,878
December 31, 2019
Other tangible assets
25,563
(8,327)
17,236
Total
640,764
(173,650)
467,114
(5) Details of changes in right-of-use assets as of December 31, 2019 are as follows (Unit: Korean Won in
millions):
Beginning balance
New contracts
Termination
Depreciation
Business combination
(Note 45)
Others
Ending balance
Building
December 31, 2019
Other tangible assets
Total
416,828
251,992
(3,803)
(219,743)
5,438
(834)
449,878
18,963
8,306
(178)
(9,984)
114
15
17,236
435,791
260,298
(3,981)
(229,727)
5,552
(819)
467,114
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 272
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16.
INTANGIBLE ASSETS
(1) Details of intangible assets are as follows (Unit: Korean Won in millions):
Goodwill
350,682
Software
174,132
Industrial
property rights
1,576
Development
cost
517,224
Other
intangible
assets
862,313
Membership
deposit
32,583
Construction
in progress
4,066
Total
1,942,576
December 31, 2019
-
(138,300)
(884)
(292,031)
(638,005)
-
-
(1,069,220)
Acquisition cost
Accumulated
amortization
Accumulated
impairment losses
Net carrying value
-
350,682
-
35,832
-
692
-
225,193
(25,993)
198,315
(3,253)
29,330
-
4,066
(29,246)
844,110
Goodwill
153,602
Software
156,109
Industrial
property rights
1,258
Development
cost
469,226
Other
intangible
assets
729,052
Membership
deposit
27,025
Construction
in progress
10,415
Total
1,546,687
December 31, 2018
-
(126,382)
(696)
(228,906)
(589,618)
-
-
(945,602)
Acquisition cost
Accumulated
amortization
Accumulated
impairment losses
Net carrying value
-
153,602
-
29,727
-
562
-
240,320
(137)
139,297
(3,428)
23,597
-
10,415
(3,565)
597,520
(2) Details of changes in intangible assets are as follows (Unit: Korean Won in millions):
For the year ended December 31, 2019
Goodwill
153,602
-
-
-
-
-
Software
29,727
13,133
-
(9,389)
-
-
Industrial
property rights
562
318
-
(188)
-
-
Development
cost
240,320
41,373
-
(64,415)
-
7,915
Other
intangible
assets
139,297
87,538
-
(54,421)
(25,858)
7,188
Beginning balance
Acquisitions
Disposal
Amortization (*1)
Impairment losses (*2)
Transfer
Foreign currencies
translation adjustment
10,234
1,269
Business combination
(Note 45)
Others
Ending balance
186,846
-
350,682
835
257
35,832
-
-
-
692
-
1,023
-
-
225,193
43,530
18
198,315
Membership
deposit
23,597
4,931
(675)
-
(939)
-
60
2,143
213
29,330
Construction
in progress
10,415
8,754
-
-
-
(15,103)
Total
597,520
156,047
(675)
(128,413)
(26,797)
-
-
12,586
-
-
4,066
233,354
488
844,110
(*1) Amortization of other intangible assets amounting to 22,317 million Won is included in other operating expenses.
(*2) The impairment test for other intangible assets indicates that the recoverable value is less than the carrying amount
and thus the impairment loss is recognized.
For the year ended December 31, 2018
Software
40,672
6,839
(4,359)
(14,028)
Industrial
property rights
539
195
-
(172)
Beginning balance
Acquisitions
Disposal
Amortization (*)
Reversal of impairment
loss
Transfer
Business combination
Foreign currencies
translation
adjustment
Others
Ending balance
Goodwill
108,707
-
-
-
-
-
46,752
-
-
763
(1,857)
-
153,602
(165)
5
29,727
Development
cost
77,241
20,935
-
(46,045)
-
188,189
-
Other
intangible
assets
117,546
45,205
(196)
(73,913)
-
51,672
-
Membership
deposit
20,685
5,162
(2,871)
-
Construction
in progress
153,209
97,067
-
-
674
-
-
-
(239,861)
-
Total
518,599
175,403
(7,426)
(134,158)
674
-
47,515
-
-
240,320
(227)
(790)
139,297
(53)
-
23,597
-
-
10,415
(2,302)
(785)
597,520
-
-
-
-
-
562
(*) Amortization of other intangible assets amounting to 51,770 million Won is included in other operating expenses.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 95 -
273
(3) Goodwill.
1) Details of allocated goodwill based on each cash-generating unit as of December 31, 2019 and 2018 are
as follows (Unit: Korean Won in million):
Cash-generating unit (*1)
December 31, 2019
December 31, 2018
Woori Asset Management Corp.
Woori Global Asset Management Co., Ltd.
Woori Asset Trust Co., Ltd.
PT Bank Woori Saudara Indonesia 1906 Tbk (*2)
WB Finance Co., Ltd (*3)
Others
Total
43,036
2,030
141,780
106,173
49,374
8,289
350,682
-
-
-
98,229
47,681
7,692
153,602
(*1) Allocated to the cash-generating unit that will benefit from the synergy effect of the business combination, and the
cash-generating unit is generally comprised of the operating or sub-sectors.
(*2) The Group has acquired Saudara Bank to expand retail sales in Indonesia, and recognized the goodwill as it is
expected to strengthen our competitiveness by securing a local sales network in Indonesia.
(*3) The Group has acquired VisionFund Cambodia to expand Cambodian retail sales, and recognized goodwill based
on the economies of scale and acquired customer base.
2) Impairment test
The recoverable amount of the cash-generating unit is measured at larger amount among the fair value less
costs to sell or the value to use.
The net fair value is calculated by deducting costs of disposal from the amount received from the sale of the
cash-generating unit in an arm’s length transaction between the parties with reasonable judgment and
willingness to negotiate. In case of difficulty in measuring this amount, the sale amount of a similar cash-
generating unit in the past market is calculated by reflecting the characteristics of the cash-generating unit.
If reliable information related to fair value less costs to sell is not available, value in use is considered as
recoverable amount. Value in use is the present value of future cash flows expected to be generated by the
cash-generating unit. Future cash flows are estimated based on the latest financial budget approved by the
management, with an estimated period of up to five years. The Group estimates cash flows based on an
annual growth rate of up to 4.0% in relation to cash flows after the longest period. The main assumptions
used to estimate cash flows are about the size of the market and the share of the group. The appropriate
discount rate for discounting future cash flows is the pre-tax discount rate, including assumptions about
risk-free interest rates, market risk premium, and systemic risk of cash-generating units. The impairment
test, which compares the carrying amount and recoverable amount of the cash-generating unit to which
goodwill has been allocated, is conducted every year and every time an impairment sign occurs.
Category
Discount rate (%).
Terminal growth rate (%)
Recoverable amount.
Carrying amount
Woori Asset
Management
Corp.
Woori
Global Asset
Management
Co., Ltd
7.3
1.0
145,820
106,735
8.8
1.0
45,367
29,577
PT Bank
Woori
Saudara
Indonesia
1906 Tbk
18.3
4.0
952,692
577,075
WB Finance
Co., Ltd
17.3
3.0
133,149
93,143
As a result of the impairment test on goodwill, it is determined that the carrying amount of the cash-
generating unit to which the goodwill has been allocated will not exceed the recoverable amount.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 274
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17. ASSETS HELD FOR DISTRIBUTION (SALE)
As of the end of the current term, the Group is planning to sell lands, buildings and machinery items that are
from subsidiary companies, Seari First Securitization Specialty Co., Ltd., Namjong 1st Securitization Specialty
Co., Ltd., Bukgeum First Securitization First Specialty Co., Ltd. and Bukgeum Second Securitization Specialty
Co., Ltd., and therefore they are classified as assets held for sale. In addition, tangible assets that are highly
likely to be sold within another year are classified as held for sale.
Assets held for distribution (sale) are as follows (Unit: Korean Won in millions):
Lands
Buildings
Others
Total
December 31, 2019
5,164
4,815
577
10,556
December 31, 2018
7,280
7,736
2,896
17,912
The Group measured assets held for sale at the lower of their net fair value or carrying amount
18. ASSETS SUBJECT TO LIEN AND ASSETS ACQUIRED THROUGH FORECLOSURES
(1) Assets subjected to lien are as follows (Unit: Korean Won in millions):
Financial assets at
Korean treasury and
Nonghyup bank
19,720 Related to bonds sold under
FVTPL
government bonds and
others
repurchase agreements (*)
Korean corporate debt
Kookmin bank and
168,327 Related to bonds sold under
Collateral given to
Amount
Reason for collateral
December 31, 2019
Financial assets at
FVTOCI
Securities at
amortized cost
Loan at amortized
cost and other
financial assets
securities
Korean corporate debt
securities
Korean financial institutions’
debt securities and others
Korean financial institutions’
debt securities and others
others
Eugene investment &
futures co., Ltd. .
Nonghyup bank and
others
BOK and others
Foreign corporate debt
Spain BBVA and others
securities
Korean corporate debt
Nonghyup bank futures
securities
Korean treasury and
government bonds
Korean treasury and
government bonds and
others
and others
Korea Securities
Depository
repurchase agreements (*)
3,008 Collateral for futures
transaction
219,938 Related to bonds sold under
repurchase agreements (*)
5,127,383 Settlement risk
56,975 Related to bonds sold under
repurchase agreements (*)
9,042 Collateral for futures
transaction
5,570 Related to bonds sold under
repurchase agreements (*)
The BOK and others
6,190,630 Settlement risk and others
Foreign financial institutions’
NATIXIS and others
debt securities
Due from banks in local
currency
Branch of IBK at
Phnom Penh and others
37,271 Related to bonds sold under
repurchase agreements (*)
11,352 Collateral deposits for local
currency borrowings
Due from banks in local
Daishin AMC and others
1,500 Right of pledge
currencies
Other due from banks in local
Samsung Securities Co.,
17,345 Margin deposit for futures
currencies
Other due from banks in
foreign currencies
Ltd. and others
Korea Investment &
Securities Co., Ltd. and
others
Foreign currency loans
Industrial and
Commercial Bank of
China
or option
180,919 Foreign margin deposit for
future or option and
others
82,594 Related to bonds sold under
repurchase agreements (*)
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Premises and
equipment
Land and building
- 97 -
275
Collateral given to
Credit Counselling &
Recovery Service and
others
December 31, 2019
Amount
Reason for collateral
689 Right to collateral and
others
Total
12,132,263
December 31, 2018
Collateral given to
Daishin AMC and others
Amount
Reason for collateral
1,500 Right of pledge
Loan at amortized
cost and other
financial assets
Due from banks on time in
local currency
Due from banks in local
Samsung Securities Co.,
38,112 Margin deposit for futures
currencies
Due from banks in foreign
currencies
Financial assets at
FVTOCI
Korean financial institutions’
debt securities and others
Korean financial institutions’
Securities at
amortized cost
Premises and
equipment
debt securities
Korean treasury and
government bonds
Korean treasury and
government bonds and
others
Land and building
Ltd. and others
Korea Investment &
Securities Co., Ltd. and
others
or option
202,156 Foreign margin deposit for
future or option and
others
The BOK and others
2,919,042 Settlement risk and others
Banco Bilbao Vizcaya
33,588 Related to bonds sold under
Argentaria, S.A
Korea Securities
Depository
repurchase agreements (*)
5,552 Related to bonds sold under
repurchase agreements (*)
The BOK and others
6,382,188 Settlement risk and others
Credit Counselling &
Recovery Service and
others
5,987
Total
9,588,125
Right to collateral and
others
(*) The Group has the agreements to repurchase the sold assets at the predetermined price or the price that includes
the rate of return and to provide the guarantee on the assets. The transferee has the right to sell or to provide as
guarantee. Therefore, the Group does not derecognize the assets, but recognizes the relevant amounts as liability
(bonds sold under repurchase agreements).
(2) As of December 31, 2019 and December 31, 2018 there is no asset acquired through foreclosures.
(3) Securities loaned are as follows (Unit: Korean Won in millions):
Financial assets
at FVTOCI
Korean financial institutions’
debt securities and others
Total
80,737
80,737
40,029
40,029
December 31,
2019
December 31,
2018
Loaned to
Korea Securities
Finance Corporation
Securities loaned are lending of specific securities to borrowers who agree to return the same amount of the same
security at the end of lending period. As the Group does not derecognize these securities, there are no liabilities
recognized through such transactions relates to securities loaned.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 276
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(4) Collaterals held that can be disposed and re-subjected to lien regardless of defaults of counterparties
Fair values of collaterals held that can be disposed and re-subjected to lien regardless of defaults of
counterparties as of December 31, 2019 and 2018 are as follows (Unit: Korean Won in millions):
Securities
9,340,517
Fair values of collaterals
Fair values of collaterals were disposed or re-
subjected to lien
December 31, 2019
Securities
12,262,041
Fair values of collaterals
Fair values of collaterals were disposed or re-
subjected to lien
December 31, 2018
-
-
19. OTHER ASSETS
Details of other assets are as follows (Unit: Korean Won in millions):
Prepaid expenses
Advance payments
Others
Total
December 31, 2019
December 31, 2018
135,010
78,306
20,330
233,646
161,129
18,467
18,057
197,653
20. FINANCIAL LIABILITIES AT FVTPL
(1) Financial liabilities at FVTPL are as follows (Unit: Korean Won in millions):
Financial instruments at fair value through profit or
loss mandatorily measured at fair value
Financial liabilities at fair value through profit or
loss designated as upon initial recognition
Total
December 31, 2019
December 31, 2018
2,870,676
87,626
2,958,302
2,117,919
164,767
2,282,686
(2) Financial liabilities at fair value through profit or loss mandatorily measured at fair value are as follows
(Unit: Korean Won in millions):
Deposits
Gold banking liabilities
Derivative liabilities
Total
December 31, 2019
December 31, 2018
27,530
2,843,146
2,870,676
27,058
2,090,861
2,117,919
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 99 -
277
(3) Financial liabilities at fair value through profit or loss designated as upon initial recognition as of December
31, 2019 and 2018 are as follows (Unit: Korean Won in millions):
Equity-linked securities
Equity-linked securities in short position
Total
December 31, 2019
December 31, 2018
87,626
87,626
164,767
164,767
Financial liabilities at fair value through profit or loss designated as upon initial recognition are designated in
order to eliminate or significantly reduce accounting mismatch arising from recognition or measurement.
(4) There are no accumulated changes in credit risk adjustments to financial liabilities at fair value through profit
or loss designated as upon initial recognition.
The adjustment to reflect Group’s credit risk is considered in measuring the fair value of equity-linked
securities index. The Group’s credit risk is determined by adjusting credit spread observed in credit rating of
Group.
(5) The difference between carrying amount and maturity amount of financial liabilities at fair value through
profit or loss designated as upon initial recognition (Financial liabilities designated as at FVTPL) are as
follows (Unit: Korean Won in millions):
Carrying amount
Nominal amount at maturity
Difference
December 31, 2019
December 31, 2018
87,626
97,503
(9,877)
164,767
217,280
(52,513)
(6) Changes in equity in relation to financial liabilities at fair value through profit or loss designated as upon
initial recognition
The cumulative gain or loss realized as a result of the derecognition of financial liabilities designated as at
fair value through profit or loss that is presented in other comprehensive income and transferred within
equity is 4 million (after income tax expense) Won for the year ended December 31, 2018.
21. DEPOSITS DUE TO CUSTOMERS
Details of deposits due to customers by type are as follows (Unit: Korean Won in millions):
Deposits in local currency:
Deposits on demand
Deposits at termination
Mutual installment
Deposits on notes payables
Deposits on CMA
Customer deposit for security investment
Certificate of deposits
Other deposits
Sub-total
Deposits in foreign currency:
Deposits in foreign currencies
Present value discount
Total
December 31, 2019
December 31, 2018
8,655,228
224,115,771
28,574
2,174,995
150,300
-
973,625
1,451,470
237,549,963
27,143,710
(8,095)
264,685,578
11,076,417
204,051,570
30,783
1,891,556
137,316
30,000
6,510,571
1,409,505
225,137,718
23,626,234
(73,013)
248,690,939
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 278
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22. BORROWINGS AND DEBENTURES
(1) Details of borrowings are as follows (Unit: Korean Won in millions):
Borrowings in local currency:
Borrowings from The
BOK
Borrowings from
government funds
Others
Sub-total
Borrowings in foreign
currencies(*):
Borrowings in foreign
currencies
Offshore borrowings in
foreign currencies
Sub-total
December 31, 2019
Lenders
Interest rate (%)
Amount
The BOK
Small Enterprise And Market
Service and others
The Korea Development Bank
and others
9,685,725
0.5~0.8
0.0~2.8
0.0~5.0
1,770,726
1,844,798
6,070,201
The Export-Import Bank of
Korea and others
HSBC, HKG
Bills sold
Call money
Bonds sold under repurchase
Others
Bank and others
Other financial institutions
agreements
Present value discount
Total
(0.3)~8.3
8,566,872
3.0
0.0~1.6
(0.3)~3.5
1.4~12.7
34,734
8,601,606
9,367
133,519
569,002
(299)
18,998,920
(*) Included borrowing in foreign currencies under cash flow hedge amounting to 34,443 million Won as of December
31, 2019.
December 31, 2018
Lenders
Interest rate (%)
Amount
The BOK
Small Enterprise And Market
Service and others
The Korea Development Bank
and others
0.5 ~ 0.8
0.0 ~ 3.5
0.0 ~ 4.0
1,335,459
1,771,379
4,716,231
7,823,069
The Export-Import Bank of
Korea and others
JPMORGAN CHASE BANK
0.0 ~ 7.5
7,308,857
Borrowings in local currency:
Borrowings from The
BOK
Borrowings from
government funds
Others
Sub-total
Borrowings in foreign
currencies:
Borrowings in foreign
currencies
Offshore borrowings in
foreign currencies
Sub-total
Bills sold
Call money
Bonds sold under repurchase
Others
Bank and others
Other financial institutions
agreements
Present value discount
Total
2.9
0.0 ~ 1.8
0.0 ~ 7.3
0.8 ~ 12.7
33,543
7,342,400
19,336
975,358
42,907
(84)
16,202,986
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 101 -
279
(2) Details of debentures are as follows (Unit: Korean Won in millions):
December 31, 2019
December 31, 2018
Interest rate (%)
Amount
Interest rate (%)
Amount
Face value of bond(*):
Ordinary bonds
Subordinated bonds
Other bonds
Sub-total
Discounts on bonds
Total
0.0~4.3
2.1~5.9
1.2~17.0
1.6 ~ 4.5
3.0 ~ 12.6
1.9 ~ 17.0
23,207,600
6,732,687
942,421
30,882,708
(24,653)
30,858,055
22,432,183
5,358,838
974,230
28,765,251
(29,389)
28,735,862
(*) Included debentures under fair value hedge amounting to 3,151,172 million Won and 2,956,565 million Won as of
December 31, 2019 and 2018, respectively. Debentures under cash flow hedge amounting to 829,082 million Won
and 823,219 million Won are also included as of December 31, 2019 and 2018, respectively.
23. PROVISIONS
(1) Details of provisions are as follows (Unit: Korean Won in millions):
Asset retirement obligation
Provisions for guarantees (*1)
Provisions for unused loan commitments
Provisions for customer reward credits (*2)
Other provisions (*3)
Total
December 31, 2019
December 31, 2018
66,485
92,486
112,554
-
172,455
443,980
67,200
89,761
121,535
49,180
63,637
391,313
(*1) Provisions for guarantees includes provision for financial guarantee of 62,764 million Won and
47,817 million Won as of December 31, 2019 and 2018, respectively.
(*2) The provisions for existing points that are paid to credit card members and others have been
reclassified to other liabilities.
(*3) Other provisions consist of provision for litigation, loss compensation and others.
(2) Changes in provisions for guarantees and unused loan commitments are as follows (Unit: Korean Won in
millions):
1) Provisions for guarantees
Beginning balance
Transfer to 12-month expected credit
loss
Transfer to expected credit loss for the
entire period
Transfer to credit-impaired financial
assets
Provisions used
Net provision (reversal) of unused
amount
Others (*)
Ending balance
For the year ended December 31, 2019
Stage1
44,903
Stage2
33,760
Stage3
11,098
Total
89,761
13,568
(13,568)
(317)
(30)
(27,711)
(14,400)
34,788
50,801
532
(32)
-
5,611
-
26,303
-
(215)
62
-
4,437
-
15,382
-
-
-
(27,711)
(4,352)
34,788
92,486
(*) Others have occurred as a result of new financial guarantee contract valued at initial fair value.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
280
- 102 -
Beginning balance
Transfer to 12-month expected credit
loss
Transfer to expected credit loss for the
entire period
Transfer to credit-impaired financial
assets
Provisions used
Net reversal of unused amount
Others (*)
Ending balance
For the year ended December 31, 2018
Stage1
47,132
Stage2
18,281
Stage3
127,511
Total
192,924
92
(92)
-
(237)
91,008
(90,771)
-
-
(38)
(20,429)
(4,866)
23,249
44,903
(29)
-
(75,410)
2
33,760
67
-
(25,709)
-
11,098
-
(20,429)
(105,985)
23,251
89,761
(*) Others have occurred as a result of new financial guarantee contract valued at initial fair value.
2) Provisions for unused loan commitment
Beginning balance
Transfer to 12-month expected credit
loss
Transfer to expected credit loss for the
entire period
Transfer to credit-impaired financial
assets
Net provision(reversal) of unused
amount
Others
Ending balance
Beginning balance
Transfer to 12-month expected credit
loss
Transfer to expected credit loss for the
entire period
Transfer to credit-impaired financial
assets
Net provision(reversal) of unused
amount
Others
Ending balance
For the year ended December 31, 2019
Stage1
74,624
Stage2
45,285
Stage3
1,626
Total
121,535
11,771
(11,024)
(1,813)
(213)
(19,394)
63
65,038
1,945
(275)
7,233
-
43,164
(747)
(132)
488
3,117
-
4,352
-
-
-
(9,044)
63
112,554
For the year ended December 31, 2018
Stage1
75,232
Stage2
27,875
Stage3
1,878
Total
104,985
7,770
(7,396)
(2,376)
2,525
(374)
(149)
(213)
(1,579)
1,792
-
-
-
(5,813)
24
74,624
23,860
-
45,285
(1,521)
-
1,626
16,526
24
121,535
(3) Changes in asset retirement obligation are as follows (Unit: Korean Won in millions):
Beginning balance
Provisions provided
Provisions used
Reversal of provisions unused
Amortization
Increase in restoration costs and others
Business Combination (Note 45)
Ending balance
For the years ended December 31
2018
2019
67,200
2,729
(2,276)
(2,926)
435
994
329
66,485
61,872
1,489
(913)
(1,038)
564
5,226
-
67,200
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 103 -
281
The amount of the asset retirement obligation is the present value of the best estimate of future expected
expenditure to settle the obligation – arising from leased premises as of December 31, 2019, discounted by
appropriate discount rate. The restoration cost is expected to occur by the end of each premise’s lease period, and
the Group has used average lease period of each category of leases terminated during the past years in order to
rationally estimate the lease period. In addition, the Group used average amount of actual recovery cost for the
past 3 years and the inflation rate for last year in order to estimate future recovery cost.
(4) Changes in other provisions are as follows (Unit: Korean Won in millions):
Beginning balance
Provisions provided
Provisions used
Reversal of provisions unused
Foreign currencies translation adjustments
Others
Business combination (Note 45)
Ending balance
For the year ended December 31,
2019
Other
provisions
63,637
109,875
(6,123)
(171)
1,193
224
3,820
172,455
Beginning balance
Provisions provided
Provisions used
Reversal of unused amount
Foreign currencies translation
adjustments
Transfer (*1)
Others
Ending balance (*2)
For the year ended December 31, 2018
Provisions for
customer reward
credits
Other
provisions
Total
40,445
70,138
(98,170)
-
-
9,228
27,539
49,180
58,791
8,384
(6,940)
(52)
(194)
-
3,648
63,637
99,236
78,522
(105,110)
(52)
(194)
9,228
31,187
112,817
(*1) Provision for customer reward credits have increased for the Group due to the point transfer from partners during
the year ended in December 31, 2018.
(*2) The provisions for existing points that are paid to credit card members and others have been reclassified to other
liabilities.
(5) Others
1) As of September 23, 2019, the Group temporarily suspended the won-payment business due to
tightened U.S. sanctions on Iran while it was ongoing to settle trade transactions between Korea and
Iran. In connection with these services, the Group is currently being investigated by US government
agencies including US prosecutors (United States Attorney’s Office and New York State Attorney
General’s Office) and Office of Foreign Assets Control as to whether the Group has violated United
States laws by participating in prohibited transactions involving the following countries: Iran, Sudan,
Syria and Cuba, which have been sanctioned by the US.
2) The Group recognized the provision of the estimated compensation amount related to the miss-selling
of the Derivative Linked Fund (DLF) incurred during the current term and a fine is expected to be
imposed by the Financial Supervisory Service as the best estimate for the expenditure required to meet
its obligations at the end of the reporting period. The Group estimated such provision will be paid at the
request of each counter party, and estimates all amount will be paid within 2020. On the other hand, the
actual amount of compensation of the Group may change due to interest rate changes since the end of
the reporting period.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 282
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24. NET DEFINED BENEFIT LIABILITY(ASSET)
The retirement benefits of the Group are based on the defined retirement benefit plans. Employees and directors
with one or more years of service are entitled to receive a payment upon termination of their employment, based
on their length of service and rate of salary at the time of termination. The assets of the plans are measured at
their fair value at the end of reporting date. The plan liabilities are measured using the projected unit method,
which takes account of projected earnings increases, using actuarial assumptions that give the best estimate of
the future cash flows that will arise under the plan liabilities.
The Group is exposed to various risks through defined benefit retirement pension plan, and the most significant
risks are as follows:
Volatility of asset
The defined benefit obligation was estimated with an interest rate
Decrease in profitability of blue
A decrease in profitability of blue chip bonds will be offset by some
calculated based on blue chip corporate bonds earnings. A deficit
may occur if the rate of return of plan assets falls short of the interest
rate.
chip bonds
Risk of inflation
increase in the value of debt securities that the employee benefit plan
owns but will bring an increase in the defined benefit obligation.
Defined benefit obligations are related to inflation rate; the higher the
inflation rate is, the higher the level of liabilities. Therefore, deficit
occurs in the system if an inflation rate increases.
(1) Details of net defined benefit liability are as follows (Unit: Korean Won in millions):
Present value of defined benefit obligation
Fair value of plan assets
Net defined benefit liability(*)
December 31, 2019
December 31, 2018
1,442,859
(1,352,971)
89,888
1,275,020
(1,101,911)
173,109
(*) Net defined benefit liability of 89,888 million Won at the end of the current term is the subtracted
amount of the net defined benefit asset of 2,582 million Won from the net defined benefit liability of
92,470 million Won.
(2) Changes in the carrying value of defined benefit obligation are as follows (Unit: Korean Won in millions):
Beginning balance
Subsequent amount from transfer company
Current service cost (*)
Interest cost (*)
Remeasurements
Financial assumption
Demographic assumptions
Experience adjustment
Foreign currencies translation adjustments
Retirement benefit paid
Business combination (Note 45)
Others
Ending balance
For the year ended
December 31, 2019
For the year ended
December 31, 2018
1,275,020
93
163,369
32,693
32,831
49,453
(33,518)
179
(79,908)
4,674
(2,027)
1,442,859
1,071,170
-
144,394
32,143
59,429
7,728
33,697
(3)
(74,952)
-
1,414
1,275,020
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 105 -
283
(3) Changes in the plan assets are as follows (Unit: Korean Won in millions):
Beginning balance
Subsequent amount from transfer company
Interest income
Remeasurements
Employer’s contributions
Retirement benefit paid
Others
Business combination (Note 45)
Ending balance
For the year ended
December 31, 2019
For the year ended
December 31, 2018
1,101,911
93
30,937
125
292,095
(76,304)
(2,255)
6,369
1,352,971
1,027,906
-
33,825
(14,783)
128,926
(71,672)
(2,291)
-
1,101,911
(4) Plan assets wholly consist of fixed deposits as of December 31, 2019 and 2018. Among plan assets,
realized returns on plan assets amount to 31,062 million Won and 19,042 million Won for the years ended
December 31, 2019 and 2018, respectively.
Meanwhile, the contribution expected to be paid in the next accounting year amounts to 156,396 million
Won.
(5) Current service cost, net interest income, loss (gain) on the curtailment or settlement and remeasurements
recognized in the consolidated statements comprehensive income are as follows (Unit: Korean Won in
millions):
Current service cost
Net interest expense (Income)
Cost recognized in net income
Remeasurements
Cost recognized in total comprehensive income
For the year ended
December 31, 2019
163,369
1,756
165,125
48,641
213,766
For the year ended
December 31, 2019
144,394
(1,682)
142,712
115,637
258,349
Retirement benefits related to defined contribution plans recognized as expenses are 3,297 million Won and
2,437 million Won for the years ended December 31, 2019 and 2018, respectively.
(6) Key actuarial assumptions used in net defined benefit liability measurement are as follows:
Discount rate
Future wage growth rate
Mortality rate
Retirement rate
December 31, 2019
2.18~2.50%
1.89~6.00%
Issued by Korea Insurance
Development Institute
Experience rate for each
employment classification
December 31, 2018
2,69%
6.18%
Issued by Korea Insurance
Development Institute
Experience rate for each
employment classification
The weighted average maturity of defined benefit liability is a minimum of 6.91 to a maximum 11.85 years.
(7) The sensitivity to actuarial assumptions used in the assessment of defined benefit obligation is as follows
(Unit: Korean Won in millions):
Discount rate
Future wage growth rate
Increase by 1% point
Decrease by 1% point
Increase by 1% point
Decrease by 1% point
December 31, 2019 December 31, 2018
(116,812)
136,990
135,767
(118,020)
(151,104)
178,434
176,169
(152,174)
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 284
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25. OTHER FINANCIAL LIABILITIES AND OTHER LIABILITIES
Other financial liabilities and other liabilities are as follows (Unit: Korean Won in millions):
December 31, 2019
December 31, 2018
Other financial liabilities:
Accounts payable
Accrued expenses
Borrowings from trust accounts
Agency business revenue
Foreign exchange payables
Domestic exchange settlement credits
Lease liabilities
Other miscellaneous financial liabilities
Present value discount
Sub-total
Other liabilities:
Unearned income
Other miscellaneous liabilities
Sub-total
Total
6,131,339
2,516,231
3,277,795
362,820
1,153,457
1,261,928
419,045
2,587,193
(3,041)
17,706,767
224,840
195,631
420,471
18,127,238
5,409,268
2,224,330
3,747,492
396,735
539,554
7,134,966
-
1,992,663
(2,484)
21,442,524
204,034
142,044
346,078
21,788,602
26. DERIVATIVES
(1) Derivative assets and derivative liabilities are as follows (Unit: Korean Won in millions):
Nominal
amount
For cash
flow hedge
Assets
For fair value
hedge
December 31, 2019
For
trading
For cash
flow hedge
Liabilities
For fair value
hedge
Interest rate:
Futures
Swaps
Purchase options
Written options
Currency:
Futures
Forwards
Swaps
Purchase options
Written options
Equity:
124,737
150,731,987
460,000
395,789
1,934
113,988,295
82,125,050
1,588,746
2,341,179
Futures
Forwards
Swaps
Purchase options
Written options
Total
630,562
11
1,280,436
8,851,984
8,978,953
371,499,663
-
-
-
-
-
-
9,367
-
-
-
-
-
-
-
9,367
-
111,764
-
-
-
300,750
11,888
-
-
-
-
-
-
-
1,447,811
966,181
18,835
-
-
-
-
-
-
111,764
-
-
1,217
175,221
-
2,921,903
-
1,323
-
-
-
321
5,193
-
-
-
-
-
-
-
6,837
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
For
trading
-
413,195
-
9,655
-
1,030,246
1,106,423
-
9,403
-
-
54,393
-
219,831
2,843,146
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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285
December 31, 2018
Nominal
Amount
For fair value
hedge
For trading
Assets
For cash flow
hedge
Liabilities
For fair value
hedge
For trading
Interest rate:
Futures
Swaps
Purchase options
Written options
Currency:
Futures
Forwards
Swaps
Purchase options
Written options
Equity:
Futures
Swaps
Purchase options
Written options
Total
-
150,710,490
530,000
525,000
320,213
88,376,776
67,179,195
1,933,454
3,134,774
186,737
441,573
4,925,315
6,145,935
324,409,462
-
35,503
-
-
-
-
-
-
-
-
218,140
10,461
-
-
843,621
761,907
17,544
-
-
-
-
-
35,503
-
31,377
143,029
-
2,026,079
-
665
-
-
-
-
33,089
-
-
-
-
-
-
33,754
-
17,654
-
-
-
-
-
-
-
-
266,207
-
12,438
-
777,039
773,701
-
20,747
-
-
-
-
17,654
-
1,217
-
239,512
2,090,861
Derivatives held for trading are classified into financial assets at FVTPL (Note 7) and financial liabilities at
FVTPL (Note 20), and derivatives designated for hedging are presented as a separate line item in the
consolidated statements of financial position.
(2) Overview of the Group’s hedge accounting
The hedging relationships the entity applies fair value hedge accounting and cash flow hedge accounting to are
affected by interest rate which is related with Interest Rate Benchmark Reform. The interest rates to which the
hedging relationships are exposed are USD 1M LIBOR, USD 3M LIBOR, USD 6M LIBOR, and 3M
EURIBOR. The nominal amounts of hedging instruments related to 1M LIBOR, 3M LIBOR, 6M LIBOR and
3M EURIBOR are USD 400,000,000, USD 2,230,000,000, USD 500,000,000, and EUR 26,635,556,
respectively. The entity pays close attention to discussions in the market and industry regarding the applicable
alternative benchmark interest rates for the exposed interest rate. The entity judges related uncertainty is
expected to be no longer present when the exposed interest rates are replaced by the applicable benchmark
interest rates.
1) Fair value hedge
As of the current period end, the Group has applied fair value hedge on fixed interest rate foreign currency
denominated debentures amounting to 3,151,172 million Won. The purpose of the hedging is to avoid fair
value volatility risk of fixed interest rate foreign currency denominated debentures derived from
fluctuations of market interest rate, and as such the Group entered into interest rate swap agreements
designated as hedging instruments.
Pursuant to the interest rate swap agreement, by swapping the calculated difference between the fixed
interest rate and floating interest rate applied to the nominal value, the fair value fluctuation risk is hedged
as the foreign currency denominated debentures fixed interest rate terms are converted to floating interest
rate. Pursuant to the interest rate swap agreement, hedge ratio is determined by matching the nominal value
of hedged instrument to the face value of the hedged item.
In this hedging relationship, only the market interest rate fluctuation, which is the most significant part of
the fair value change of the hedged item, is designated as the hedged risk, and other risk factors including
credit risk are not included in the hedged risk. Therefore, the ineffective portion of the hedge could arise
from fluctuations in the timing of the cash flow of the hedged item, the change in the total amount and price
of the hedged item, or significant credit risk fluctuation of either party of the hedging instrument.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 286
- 108 -
The interest rate swap agreements and the hedged items are subject to fluctuations in the underlying market
rate of interest and the Group expects the fair value of the interest rate swap contract and the value of the
hedged item to generally change in the opposite direction.
The fair value of the interest rate swap at the end of the reporting period is determined by discounting future
cash flows estimated by using the yield curve at the end of the reporting period and the credit risk
embedded in the contract and the average interest rate is determined based on the outstanding balance at the
end of the reporting period. The variable interest rate applied to the interest rate swap is USD Libor 3M
(6M) plus spread. In accordance with the terms of each interest rate swap contract designated as a hedging
instrument, the Group receives interest at a fixed interest rate and pays interest at a variable interest rate.
2) Cash Flow Hedge
As of the December, 31 2019, the Group has applied cash flow hedge on local currency denominated
debentures amounting to 99,941 million Won, debentures on foreign currency amounting to 729,141
million Won and Borrowings in foreign currency amounting to 34,443 million Won. The Group’s hedging
strategies are to ① Mitigate risks of cash flow fluctuation from variable interest rate debentures on local
currency due to changes in market interest rate by entering into an interest rate swap contract and thereby
designating it as hedging instrument; ② Mitigate the risks of cash flow fluctuation from principal and
interest of variable-interest rate debentures denominated in foreign currency due to changes in foreign
exchange rates and interest rates by entering into a currency swap contract and thereby designating it as
hedging instrument; ③ Mitigate the risks of cash flow fluctuation from principal and interest of fixed-
interest rate debentures denominated in foreign currency due to changes in foreign exchange rates by
entering into a currency swap contract and thereby designating it as hedging instrument and ④ Mitigate
the risks of cash flow fluctuation in variable-interest rate foreign currency borrowings resulting from
changes in market interest rates and designate it as a hedging instrument through entering into currency
swap contracts and interest rate swap contracts.
This means exchanging a predetermined nominal amount as set forth in the interest rate swap contract
adjusted by the differences between the fixed and variable interest rates, which results in the conversion of
interest rates of debentures in local currency and borrowings in foreign currency from variable interest into
fixed interest, eliminating the cash flow fluctuation risk.
In addition, this also means a payment of predetermined principal amount as set forth in the currency swap
adjusted by fixed interest rate, an exchange of an amount calculated by applying variable interest rate to
USD or applying fixed interest rate to SGD, and an exchange of the principal denominated in KRW and
principal denominated in foreign currency at maturity eliminating cash flow fluctuation risk on principal
and interest.
The hedge ratio is determined by matching the nominal amount of the hedging instrument to the face
amount of the hedged item in accordance with interest rate swap and currency swap.
Only interest rate and foreign exchange rate fluctuation risk, which is the most significant factor in the cash
flow fluctuation of the hedged item, is addressed in this hedging relationship, and other risk factors such as
credit risk are not subject to hedging.
Thus, there could be hedge ineffectiveness arising from price margin set by the counterparty of hedging
instruments and unilateral change in credit risk of any party in the transaction.
The interest rate swap, currency swap contract and the hedged item are all affected by the changes in market
interest rate and foreign exchange rates which are basic factors of the derivative. The Group expects that the
value of interest rate swap contract, currency swap contract and the hedged item will generally fluctuate in
opposite direction.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 109 -
287
(3) The nominal amounts of the hedging instrument are as follows (Unit: USD, EUR, SGD, JPY and Korean
Won in millions):
Fair value hedge
Interest rate risk
1 year or less
December 31, 2019
1 year to 5
years
More than 5
years
Total
Interest rate swap (USD)
350,000,000
2,000,000,000
300,000,000
2,650,000,000
Cash flow hedge
Interest rate risk
Interest rate swap (EUR)
Interest rate swap (KRW)
Foreign currencies translation risk
and interest rate risk
Currency swap(USD)
Foreign currencies translation risk
Currency swap (SGD)
Currency forward (JPY)
-
-
26,635,556
100,000
150,000,000
330,000,000
136,000,000
49,325,155
68,000,000
1,059,903,932
-
-
-
-
-
26,635,556
100,000
480,000,000
204,000,000
1,109,229,087
1 year or less
December 31, 2018
1 year to 5
years
More than 5
years
Total
Fair value hedge
Interest rate risk
Interest rate swap (USD)
Cash flow hedge
Interest rate risk
Interest rate swap (KRW)
Foreign currencies translation
risk and interest rate risk
Currency swap (USD)
Foreign currencies translation
risk
Currency swap (SGD)
1,350,000,000
1,300,000,000
2,650,000,000
-
-
100,000
-
-
-
100,000
500,000,000
204,000,000
50,000,000
450,000,000
-
204,000,000
(4) The average interest rate and average currency rate of the hedging instrument as of December 31, 2019 and
December 31, 2018 are as follows:
Fair value hedge
Interest rate risk
Interest rate swap (USD)
Cash flow hedge
Interest rate risk
Interest rate swap (EUR)
Interest rate swap (KRW)
Foreign currencies translation
risk and interest rate risk
Currency swap (USD)
Foreign currencies translation
risk
Currency swap (SGD)
Currency forward (JPY)
December 31, 2019
Average interest rate and average exchange rate
Fixed 3.96% receipt and Libor 3M+1.61% floating paid
Fixed 5.88% receipt and Libor 6M+2.15% floating paid
3M EURIBOR receipt, EUR 0.09% paid
CMS 3Y+0.40% receipt, 2.38% paid
USD 3M Libor+0.8% receipt, KRW 1.45% paid, KRW/USD = 1,155
USD 1M Libor+0.54% receipt, KRW 1.53% paid, KRW/USD = 1,158
SGD 1.91% receipt, KRW 1.98% paid, KRW/SGD = 828
KRW/JPY = 10.47
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 288
- 110 -
Fair value hedge
Interest rate risk
Interest rate swaps (USD)
Cash flow hedge
Interest rate risk
Interest rate swap (KRW)
Foreign currencies
translation risk and
interest rate risk
Currency swap (USD)
Foreign currencies
translation risk
Currency swap (SGD)
December 31, 2018
Average interest rate and average exchange rate
Fixed 3.96% receipt and Libor 3M+1.61% floating paid
Fixed 5.88% receipt and Libor 6M+2.15% floating paid
CMS 3Y+0.40% receipt, 2.38% paid
USD 3M Libor+0.70% receipt, KRW 1.74% paid, KRW/USD = 1,136
USD 1M Libor+0.52% receipt, KRW 1.70% paid, KRW/USD = 1,178
SGD 1.91% receipt, KRW 1.98% paid, KRW/SGD = 828
(5) The amounts related to items designated as hedging instruments are as follows (Unit: Korean Won in
millions, USD, EUR, SGD and JPY):
December 31, 2019
Carrying amounts of the hedging
instrument
Nominal amounts of
the hedging
instrument
Assets
Liabilities
Line item in the
statement of financial
position where the
hedging instrument is
located
Changing in fair
value used for
calculating hedge
ineffectiveness
Fair value hedge
Interest rate risk
Interest rate
swap
Cash flow hedge
Interest rate risk
Interest rate
swap
Interest rate
swap
Foreign currency
translation risk
and interest rate
risk
Currency swap
Foreign currency
translation risk
USD 2,650,000,000
111,764
Derivative assets
(designated for hedging)
-,
EUR 26,635,556
KRW 100,000
-
-
43
1,280
Derivative liabilities
(designated for hedging)
Derivative liabilities
(designated for hedging)
USD 480,000,000
4,070
5,193
Derivative assets
(designated for hedging)
Derivative liabilities
(designated for hedging)
Currency swap
Currency
forward
SGD 204,000,000
JPY 1,109,229,087
5,297
-
Derivative assets
(designated for hedging)
Derivative liabilities
(designated for hedging)
-
321
90,244
(43)
(615)
22,364
8,918
321
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 111 -
289
December 31, 2018
Carrying amounts of the hedging
instrument
Nominal amounts of
the hedging
instrument
Assets
Liabilities
Line item in the
statement of financial
position where the
hedging instrument is
located
Changing in fair
value used for
calculating hedge
ineffectiveness
Fair value hedge
Interest rate risk
Interest rate
swap
Cash flow hedge
Interest rate risk
Interest rate
swap
Foreign currencies
translation risk
and interest rate
risk
Currency swap
Foreign currencies
translation risk
Currency swap
USD 2,650,000,000
KRW 100,000
USD 500,000,000
SGD 204,000,000
35,503
17,654
Derivative assets
(Designated for hedging)
Derivative liabilities
(Designated for hedging)
-
-
-
Derivative liabilities
(Designated for hedging)
665
28,907
Derivative liabilities
(Designated for hedging)
4,182
Derivative liabilities
(Designated for hedging)
(27,362)
(665)
21,582
2,353
(6) Details of carrying amount to hedge and amount due to hedge accounting are as follows (Unit: Korean Won
in millions):
December 30, 2019
Accumulated amount of
fair value hedge
adjustments on the hedged
item included in the
carrying amount of the
hedged item
Assets
Liabilities
Line item in the
statement of
financial
position in
which the
hedged item is
included
Changing in
fair value
used for
calculating
hedge
ineffectivene
ss
Cash flow
hedge
reserve
(*)
-
-
-
-
-
91,368
Debentures
(85,984)
-
Borrowing
foreign
currency
Debentures
43
663
(43)
(821)
Debentures
(25,057)
(2,525)
Debentures
(8,315)
(2,304)
-
-
-
-
Carrying amounts of
the hedging item
Assets
Liabilities
-
3,151,172
-
-
-
-
34,443
99,941
554,433
174,708
Fair value hedge
Interest rate risk
Debentures
Cash flow hedge
Interest rate risk
Borrowings in
foreign
currency
Debentures
Foreign currencies
translation risk
and interest rate
risk
Debentures
Foreign currencies
translation risk
Debentures
(*) After tax amount
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 290
- 112 -
December 31, 2018
Accumulated amount of
fair value hedge
adjustments on the hedged
item included in the
carrying amount of the
hedged item
Assets
Liabilities
Line item in the
statement of
financial
position in
which the
hedged item is
included
Changing in
fair value
used for
calculating
hedge
ineffectivene
ss
Cash flow
hedge
reserve
(*)
Carrying amounts of
the hedging item
Assets
Liabilities
-
-
-
-
2,956,565
99,911
557,186
166,122
-
-
-
-
5,200
Debentures
25,498
-
-
-
-
Debentures
521
(371)
Debentures
(16,790)
(1,211)
Debentures
(1,762)
(2,287)
Fair value hedge
Interest rate risk
Debentures
Cash flow hedge
Interest rate risk
Debentures
Foreign
currencies
translation risk
and interest rate
risk
Debentures
Foreign
currencies
translation risk
Debentures
(*) After tax amount
(7) Amounts recognized in profit or loss due to the ineffective portion of fair value hedges during the current
period are as follows (Unit: Korean Won in millions):
Fair value hedge
Interest rate risk
4,260 Other net operating income(expense)
For the year ended December 30, 2019
Hedge ineffectiveness
recognized in profit or
loss
Line item in the profit or loss that
includes hedge ineffectiveness
Fair value hedge
Interest rate risk
(1,864) Other net operating income(expense)
For the year ended December 30, 2018
Hedge ineffectiveness
recognized in profit or
loss
Line item in the profit or loss that
includes hedge ineffectiveness
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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291
(8) Reclassification of profit or loss from other comprehensive income and equity related to cash flow hedges
are as follows (Unit: Korean Won in millions):
For the year ended December 31, 2019
Changes in
the value of
hedging
instruments
recognized in
cash flow
hedge reserve
Hedge
ineffective
ness
recognize
d in profit
or loss
Changes in
the value
of foreign
basis
spread
recognized
in OCI
(658)
-
-
21,420
944
838
7,638
1,601
560
Amounts
reclassified
from cash
flow hedge
reserve to
profit or
loss
-
(23,541)
(8,215)
Line item in the
profit or loss that
includes hedge
ineffectiveness
Other net
operating
income
(expense)
Other net
operating
income
(expense)
Other net
operating
income
(expense)
For the year ended December 31, 2018
Changes in
the value of
hedging
instruments
recognized in
cash flow
hedge reserve
Hedge
ineffective
ness
recognize
d in profit
or loss
Changes in
the value
of foreign
basis
spread
recognized
in OCI
(517)
(148)
-
21,429
153
(882)
2,353
-
(491)
Amounts
reclassified
from cash
flow hedge
reserve to
profit or
loss
-
(23,084)
(3,601)
Line item in the
profit or loss that
includes hedge
ineffectiveness
Other net
operating
income
(expense)
Other net
operating
income
(expense)
Other net
operating
income
(expense)
Line item
affected in profit
or loss due to
reclassification
Other net
operating income
(expense)
Other net
operating income
(expense)
Other net
operating income
(expense)
Line item
affected in profit
or loss due to
reclassification
Other net
operating income
(expense)
Other net
operating income
(expense)
Other net
operating income
(expense)
Interest rate risk
Cash
flow
hedge
Foreign currencies
translation risk
and interest rate
risk
Foreign currencies
translation risk
Interest rate risk
Cash
flow
hedge
Foreign currencies
translation risk
and interest rate
risk
Foreign currencies
translation risk
27. DEFERRED DAY 1 PROFITS OR LOSSES
Changes in deferred day 1 profits or losses are as follows (Unit: Korean Won in millions):
Beginning balance
New transactions
Amounts recognized in losses
Ending balance
For the years ended December 31
2018
2019
25,463
53,289
(26,493)
52,259
7,416
23,678
(5,631)
25,463
In case some variables to measure fair values of financial instruments are not observable in the market, valuation
techniques are utilized to evaluate such financial instruments. Those financial instruments are recorded the
transaction price as at the time of acquisition, even though there are difference noted between the transaction
price and the fair value. The table above presents the difference yet to be realized as profit or losses.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
292
28. EQUITY
- 114 -
(1) Details of equity as of December 31, 2019 and 2018 are as follows (Unit: Korean Won in millions):
December 31, 2019
December 31, 2018
Capital
Common stock capital
Hybrid securities (*1)
Capital surplus
Paid in capital in excess of par (*2)
Equity method
Others
Sub-total
Capital adjustments
Treasury stocks
Other adjustments (*3)
Sub-total
Accumulated other comprehensive income
Financial assets at FVTOCI
Gain(loss) on evaluation of investment
stocks by equity method
Gain(loss) from foreign business translation
Remeasurements of defined benefit plan
Gain(loss) on evaluation of cash flow hedge
Sub-total
Retained earnings (*4)
Non-controlling interest (*1) (*5)
Total
3,611,338
997,544
608,348
1,153
16,794
626,295
-
(1,748,667)
(1,748,667)
(71,914)
915
(152,987)
(270,977)
(5,692)
(500,655)
18,524,515
3,981,962
25,492,332
3,381,392
3,161,963
269,533
-
16,356
285,889
(34,113)
(1,607,647)
(1,641,760)
(87,182)
302
(244,735)
(236,726)
(3,869)
(572,210)
17,124,657
213,113
21,953,044
(*1) At the end of the previous term, hybrid securities were issued by Woori Bank, a subsidiary company, and were
classified as non-controlling interests of capital from the 11th of January, 2019.
(*2) Capital surplus increased as new shares were issued through a comprehensive stock exchange of shares when
Woori Financial Inc. was established. (Note 1)
(*3) Included capital transaction gains and losses recognized by the 2014 merger of Woori Bank and (formerly) Woori
Financial Group Inc. During the current term, the Group entered to acquire and additional interest in the Woori
Asset Trust Co., Ltd., reducing the capital adjustment by 111,242 million Won.
(*4) The regulatory reserved for credit loss under the relevant laws as of December 31, 2019 and 2018 are 2,356,246
million Won, and 2,578,457 million Won, respectively.
(*5) 69,533 million Won increased as of December 31, 2019 due to business combination of Woori Asset Management
Corp., and Woori Asset Trust Co., Ltd. (Note 45)
(2) The number of authorized shares and others of the Group are as follows:
Shares of common stock authorized
Par value
Shares of common stock issued
Capital stock
December 31, 2019
4,000,000,000 Shares
5,000 Won
722,267,683 Shares
3,611,338 million Won
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 115 -
293
(3) Details of changes in shares of the Group issued are as follows:
Date of incorporation (*1)
Increase (*2)
Decrease
Ending Balance
December 31, 2019
680,164,306
42,103,377
-
722,267,683
(*1) The number of shares issued by Woori Bank at the end of the business combination period is 676,000,000. When
Woori Financial Group Inc. was established, 4,164,306 shares were issued as a result of stock comprehensive
exchange with Woori Bank which is a shareholder of Woori FIS Co., Ltd., Woori Finance Management Research
Institute Co., Ltd., Woori Credit Information Co., Ltd., Woori Private Equity Asset Management Co., Ltd., and
Woori Fund Service Co., Ltd.
(*2) New stocks were issued for the comprehensive stock exchange which was to transfer Woori Card Co., Ltd., as a first
level of subsidiary from second-tier subsidiary in September, 2019.
(4) Hybrid securities
The bond-type hybrid securities classified as owner’s equity are as follows (Unit: Korean Won in millions):
Securities in local
currency
Issue date
July 18, 2019
October 11, 2019
Maturity
-
-
Issuance cost
Total
3.49
3.32
sInterest rate (%) December 31, 2019
500,000
500,000
(2,456)
997,544
The hybrid securities mentioned above do not have maturity date but are redeemable after 5 years.
(5) Capital adjustment
Details of changes in capital adjustments are as follows (Unit: Korean Won in millions):
Beginning balance
Losses on redemption of hybrid securities
Net increase of treasury stocks
Transaction with other owners (*)
Ending balance
December 31, 2019
December 31, 2018
(1,641,760)
(277)
4,245
(110,875)
(1,748,667)
(1,849,551)
(368)
-
208,159
(1,641,760)
(*) 111,242 million Won is included which has been reduced by the Group to obtain an additional stake in the Woori
Asset Trust Co., Ltd.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 294
- 116 -
(6) Accumulated other comprehensive income
Changes in the accumulated other comprehensive income are as follows (Unit: Korean Won in millions):
For the year ended December 31, 2019
Reclassif-
ication
adjustments
Increase
(decrease) (*)
Income tax
effect
Ending
balance
Beginning
balance
Net gain (loss) on valuation of financial
assets at FVTOCI
Share of other comprehensive gain (loss)
of joint ventures and associates
Gain (loss) on foreign currency
translation of foreign operations
Remeasurement gain (loss) related to
defined benefit plan
Gain (loss) on valuation of derivatives
designated as cash flow hedges
Total
(87,182)
(24,180)
43,021
(3,573)
(71,914)
302
(1,420)
(244,735)
96,157
(236,726)
(48,244)
-
-
-
2,033
915
(4,409)
(152,987)
13,993
(270,977)
(3,869)
(572,210)
(32,719)
(10,406)
31,756
74,777
(860)
7,184
(5,692)
(500,655)
(*) The increase and decrease of financial asset valuation profit or loss at fair value through other comprehensive income
is a change due to the period evaluation and includes the amount of 29,368 million Won replaced by retained earnings
due to the disposal of the equity securities.
Beginning
balance
For the year ended December 31, 2018
Increase
(decrease)
(*1)(*2)
Reclassification
adjustments
Income tax
effect
Ending
balance
Net gain (loss) on valuation of
financial assets at FVTOCI
Gain (loss) on financial liabilities at
FVTPL designated as upon
initial recognition due to own
credit risk
Share of other comprehensive gain
(loss) of joint ventures and
associates
Gain (loss) on foreign currency
translation of foreign operations
Remeasurement gain (loss) related
to defined benefit plan
Gain (loss) on valuation of
derivatives designated as cash
flow hedges
Transfer to assets held for
distribution (sale)
Total
(88,906)
(8,677)
8,015
2,386
(87,182)
(96)
132
(2,656)
4,080
(242,806)
(2,661)
(152,358)
(111,401)
-
-
-
-
(36)
-
(1,122)
302
732
(244,735)
27,033
(236,726)
777
30,655
(26,871)
(8,430)
(3,869)
4,145
(481,900)
(4,145)
(92,017)
-
(18,856)
-
20,563
-
(572,210)
(*1) Net gain (loss) on valuation of financial assets at FVTOCI included the 1,009 million Won transfer to retained
earnings due to disposal of equity securities.
(*2) Gain (loss) on financial liabilities at fair value through profit or loss designated as upon initial recognition due to
credit risk included the 4 million Won transferred to retained earnings due to redemption.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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295
(7) Regulatory Reserve for Credit Loss
In accordance with Paragraphs 1 and 3 of Article 27 of the Financial holding company Supervision Regulations,
the Group calculates and discloses the regulatory reserve for credit loss.
1) Balance of the regulatory reserve for credit loss
Balance of the planned regulatory reserve for credit loss is as follows (Unit: Korean Won in millions):
Beginning balance
Planned provision of regulatory reserve (reversal) for credit
loss
Ending balance
December 31,
2019
2,356,246
December 31,
2018(*)
2,578,457
191,301
2,547,547
(222,211)
2,356,246
(*) The amount is calculated and accumulated in accordance with Article 29 of the Banking Supervision Regulations,
paragraphs 1 and 2.
2) Planned reserves provided, adjusted net income after the planned reserves provided and adjusted EPS
after the planned reserves provided are as follows (Unit: Korean Won in millions, except for EPS
amount):
Net income
Provision of regulatory reserve for credit loss(*)
Adjusted net income after the provision of regulatory reserve
Adjusted EPS after the provision of regulatory reserve
(Unit: Korean Won)
For the years ended December 31
2019
2,037,596
191,301
1,846,295
2018
2,051,649
40,875
2,010,774
2,689
2,762
(*) The amount of reserve for credit loss for the year ended December 31, 2018 is calculated considering only the
change in the reserve for credit loss after the accounting policy change due to adoption of K-IFRS 1109. Therefore,
the effect of reducing the reserve for credit losses due to changes in accounting policies was excluded.
(8) Treasury stock
Details of treasury stocks are as follows (Unit: Shares, Korean Won in millions):
Beginning balance
Acquisition(*)
Disposal
Ending balance
December 31, 2019
Number of shares
Book value
2,728,774
57,721,387
(60,450,159)
2
34,113
799,886
(833,999)
-
(*) At the establishment of Woori Financial Group Inc., Woori Bank acquired 15,618,008 shares of the Group. (The
comprehensive stock transfer of Woori FIS Co., Ltd., Woori Finance Research Institute Co., Ltd., Woori Credit
Information Co., Woori Fund Services Co., Woori Private Equity Asset Management Co. and the parent company,
Woori Financial Group Inc. :4,164,306 shares, execution of the right to purchase shares from shareholders who
were against to comprehensive stock transfer: 11,453,702 shares) In September 2019, Woori Bank acquired
42,103,377 additional shares of Woori Financial Group Inc. through a comprehensive exchange of shares of Woori
Card Co., Ltd. and Woori Financial Group Inc., the parent company. 2 shares of treasury stocks have been incurred
for the provision for odd-lot payment incurred during the partial stock replacement of the shareholders who possess
physical stock certificate.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review
296
29. DIVIDENDS
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Dividends for the years 2019 and 2018 are 700 Won and 650 Won, respectively, and the total amount of
dividends paid are 505,587 million Won and 437,626 million Won, respectively. The dividends for the current
period will be submitted as an agenda in the upcoming annual shareholders’ meeting scheduled on March 25,
2020.
30. NET INTEREST INCOME
(1) Interest income recognized is as follows (Unit: Korean Won in millions):
For the years ended December 31
2019
2018
Financial assets at FVTPL
Financial assets at FVTOCI
Financial assets at amortized cost
Securities at amortized cost
Loans and other financial assets at
amortized cost:
Interest on due from banks
Interest on loans
Interest of other receivables
Sub-total
Total
50,619
474,751
436,340
141,330
9,443,740
29,990
10,051,400
10,576,770
(2) Interest expense recognized are as follows (Unit: Korean Won in millions):
For the years ended December 31
2019
2018
Interest on deposits due to customers
Interest on borrowings
Interest on debentures
Other interest expense
Interest on lease liabilities
Total
3,424,441
383,213
777,322
89,002
9,086
4,683,064
54,243
280,371
376,788
112,581
8,832,485
28,031
9,349,885
9,684,499
2,917,165
306,739
720,394
89,250
-
4,033,548
31. NET FEES AND COMMISSIONS INCOME
(1) Details of fees and commissions income recognized are as follows (Unit: Korean Won in millions):
Fees and commission received for brokerage
Fees and commission received related to credit
Fees and commission received for electronic finance
Fees and commission received on foreign exchange handling
Fees and commission received on foreign exchange
Fees and commission received for guarantee
Fees and commission received on credit card
Fees and commission received on securities business
Fees and commission from trust management
Fees and commission received on credit Information
Other fees
Total
For the years ended December 31
2019
156,578
189,597
137,289
61,756
92,408
71,106
548,580
113,346
180,290
12,626
145,750
1,709,326
2018
162,344
173,233
121,250
60,433
66,036
65,254
598,705
96,379
177,456
12,985
146,689
1,680,764
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 119 -
297
(2) Details of fees and commissions expense incurred are as follows (Unit: Korean Won in millions):
Fees and commissions paid
Credit card commission
Brokerage commission
Others
Total
32. DIVIDEND INCOME
For the years ended December 31
2019
2018
189,789
407,689
775
8,445
606,698
174,669
428,613
1,833
5,675
610,790
(1) Details of dividend income recognized are as follows (Unit: Korean Won in millions):
Dividend income related to financial assets at FVTPL
Dividend income financial assets at FVTOCI
Total
For the years ended December 31
2018
2019
86,979
20,980
107,959
67,892
22,660
90,552
(2) Details of dividends related to financial assets at FVTOCI are as follows (Unit: Korean Won in millions):
Dividend income recognized from assets held
Equity securities
Dividend income recognized in assets derecognized
Total
For the years ended December 31
2018
2019
20,980
-
20,980
22,386
274
22,660
33. NET GAIN OR LOSS ON FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
MANDATORILY MEASURED AT FAIR VALUE
(1) Details of gains or losses related to net gain or loss on financial instruments at FVTPL are as follows (Unit:
Korean Won in millions):
Gain on financial instruments at fair value through profit o
r loss mandatorily measured at fair value
Gain on financial instruments at fair value through profit
or loss designated as upon initial recognition
Total
For the years ended December 31
2019
2018
58,692
(33,237)
25,455
196,959
17,484
214,443
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(2) Details of net gain or loss on financial instruments at fair value through profit or loss mandatorily measured
at fair value and financial instruments held for trading are as follows (Unit: Korean Won in millions):
For the years ended December 31
2018
2019
Financial
assets at
FVTPL
(financial
assets held
for
trading)
Securities
Loans
Other
financial
assets
Gain on valuation
Gain on disposals
Loss on valuation
Loss on disposals
Sub-total
Gain on valuation
Gain on disposals
Loss on valuation
Loss on disposals
Sub-total
Gain on valuation
Gain on disposals
Loss on valuation
Loss on disposals
Sub-total
Derivatives
(for
trading)
Sub-total
Interest rate
derivatives
Gain on transactions
and valuation
Loss on transactions
and valuation
Sub-total
Currency
Gain on transactions
derivatives
and valuation
Loss on transactions
and valuation
Sub-total
Equity
Gain on transactions
derivatives
and valuation
Loss on transactions
and valuation
Sub-total
Other
Gain on transactions
derivatives
and valuation
Loss on transactions
and valuation
Sub-total
Sub-total
Total
121,794
64,600
(61,288)
(19,018)
106,088
1,037
519
(21)
-
1,535
2,062
1,901
(1,755)
(1,815)
393
108,016
1,507,254
(1,615,833)
(108,579)
6,872,513
(6,855,447)
17,066
839,196
(796,336)
42,860
695
(1,366)
(671)
(49,324)
58,692
137,237
45,105
(25,499)
(26,728)
130,115
1,606
4,136
(4,805)
(117)
820
2,050
530
(2,280)
(86)
214
131,149
1,255,581
(1,303,244)
(47,663)
4,935,922
(4,822,915)
113,007
486,560
(484,986)
1,574
4,138
(5,246)
(1,108)
65,810
196,959
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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299
(3) Details of net gain(loss) on financial instruments at fair value through profit or loss designated as upon
initial recognition and Losses on financial instruments designated as at fair value through profit or loss are
as follows (Unit: Korean Won in millions):
Gain(loss) on equity-linked securities:
Loss on disposal of equity-linked securities
Gain(loss) on valuation of equity-linked securities
Sub-total
Gain on other financial instruments:
Gain on valuation of other financial instruments
Total
For the years ended December 31
2018
2019
(16,006)
(17,231)
(33,237)
-
(33,237)
(2,058)
17,945
15,887
1,597
17,484
34. NET GAIN OR LOSS ON FINANCIAL ASSETS AT FVTOCI AND AFS FINANCIAL ASSETS
Details of net gain or loss on financial assets at FVTOCI recognized are as follows (Unit: Korean Won in
millions) :
Gain on redemption of securities
Gain on transactions of securities
Total
For the years ended December 31
2018
2019
15
11,000
11,015
53
1,994
2,047
35. REVERSAL OF (PROVISION FOR) IMPAIRMENT LOSSES DUE TO CREDIT LOSS
Reversal of (provision for) impairment losses due to credit loss are as follows (Unit: Korean Won in millions):
Impairment loss due to credit loss on
financial assets measured at FVTOCI
Impairment loss due to credit loss on securities at amortized cost
Reversal for credit loss on loan
and other financial assets at amortized cost
Reversal of provision on guarantee
Reversal of provision on (provision for) unused loan commitment
Total
For the years ended December 31
2019
2018
(3,297)
1,415
(385,758)
4,352
9,044
(374,244)
(2,027)
(1,922)
(415,084)
105,985
(16,526)
(329,574)
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36. GENERAL AND ADMINISTRATIVE EXPENSES AND OTHER NET OPERATING INCOME
(EXPENSES)
(1) Details of general and administrative expenses recognized are as follows (Unit: Korean Won in millions):
For the years ended December 31
2018
2019
Employee
benefits
Salaries
Employee fringe
benefits
Short-term
employee
benefits
Share based payments
Retirement benefit service costs
Termination
Sub-total
Depreciation and amortization
Other general
and
administrative
expenses
Rent
Taxes and public dues
Service charges
Computer and IT related
Telephone and communication
Operating promotion
Advertising
Printing
Traveling
Supplies
Insurance premium
Reimbursement
Maintenance
Water, light and heating
Vehicle maintenance
Others
Sub-total
Total
1,584,791
475,238
6,328
168,423
156,441
2,391,221
481,176
85,705
137,137
235,117
93,573
70,220
45,594
85,887
7,845
13,255
7,736
9,668
23,577
18,495
15,272
10,564
34,035
893,680
3,766,077
1,484,236
468,012
-
145,149
225,106
2,322,503
216,735
321,198
115,454
222,530
88,689
70,618
43,540
72,450
8,601
12,757
7,071
8,355
23,474
17,384
14,686
10,264
47,724
1,084,795
3,624,033
(2) Details of other operating income recognized are as follows (Unit: Korean Won in millions):
Gain on transactions of foreign exchange
Gain related to derivatives(Designated for hedging)
Gain on fair value hedged items
Others (*)
Total
For the years ended December 31
2019
2018
602,115
126,651
231
45,706
774,703
1,227,561
35,810
42,797
82,417
1,388,585
(*) Other income includes income amounting to 29,316 million Won for the years ended December 31, 2018, that the
Group recognized for it is to receive from other creditor financial institutions in accordance with the creditor
financial institutions committee agreement.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 123 -
301
(3) Details of other operating expenses recognized are as follows (Unit: Korean Won in millions):
Losses on transactions of foreign exchange
KDIC deposit insurance premium
Contribution to miscellaneous funds
Losses related to derivatives (Designated for hedging)
Losses on fair value hedged items
Others (*)
Total
For the years ended December 31
2019
2018
192,331
333,600
317,667
3,686
86,214
143,786
1,077,284
991,423
315,315
298,416
36,483
17,299
124,240
1,783,176
(*) Other expense includes such expenses amounting to 1,594 million for the years ended December 31, 2018 , which
are related to the Group’s expected payments to other creditor financial institutions in accordance with the creditor
financial institutions committee agreement. In addition, in includes 22,317 million Won and 51,770 million Won,
respectively, of intangible asset amortization expense for the years ended December 31, 2019 and 2018,
respectively.
(4) Share-based payment
Details of performance condition share-based payment granted to executives as of December 31, 2019 is as
follows.
1) Performance condition share-based payment
Subject to
Type of payment
Vesting period
Date of payment
Number of shares measured as of the closing date (*)
Shares granted for the year 2019
Cash-settled
January 1, 2019 ~ December 31, 2022
2023-01-01
524,746 shares
(*) The number of payable stocks is granted at the initial contract date and the payment rate is determined based on the
achievement of the pre-determined performance targets. Performance is evaluated as long-term performance
indication including relative shareholder return, net income, return on equity (ROE), non-performing loan ratio and
job performance.
2) The Group accounts for performance condition share-based payments according to the cash-settled
method and the fair value of the liabilities is reflected in the compensation costs by re-measuring every
closing period. As of December 31, 2019, the book value of the liabilities related to the performance
condition share-based payments recognized by the Group is 6,328 million Won.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 302
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37.
OTHER NON-OPERATING INCOME (EXPENSES)
(1) Details of gains or losses on valuation of investments in joint ventures and associates are as follows (Unit:
Korean Won in millions):
Gains on valuation of investments in joint ventures and associates
Losses on valuation of investments in joint ventures and associates
Impairment losses of investments in joint ventures and associates
Total
For the years ended December 31
2019
2018
103,775
(16,144)
(3,634)
83,997
25,791
(22,595)
(177)
3,019
(2) Details of other non-operating income and expenses recognized are as follows (Unit: Korean Won in
millions):
Other non-operating incomes
Other non-operating expenses
Total
For the years ended December 31
2019
2018
68,459
(229,383)
(160,924)
129,709
(87,157)
42,552
(3) Details of other non-operating income recognized are as follows (Unit: Korean Won in millions):
Rental fee income
Gains on disposal of investments in joint ventures and associates
Gains on disposal of premises and equipment, intangible
assets and other assets
Reversal of impairment loss of premises and equipment,
intangible assets and other assets
Others
Total
For the years ended December 31
2019
2018
10,106
-
1,632
103
56,618
68,459
6,835
50,511
30,278
761
41,324
129,709
(4) Details of other non-operating expenses recognized are as follows (Unit: Korean Won in millions):
Depreciation on investment properties
Interest expenses of refundable deposits
Losses on disposal of investment in joint ventures and associates
Losses on disposal of premises and equipment, intangible assets and ot
her assets
Impairment losses of premises and equipment, intangible assets and
other assets
Donation
Others
Total
For the years ended December 31
2019
2018
2,225
834
-
3,433
28,295
62,545
132,051
229,383
4,045
620
2,931
1,160
87
51,983
26,331
87,157
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 125 -
303
38.
INCOME TAX EXPENSE
(1) Details of income tax expenses are as follows (Unit: Korean Won in millions):
Current tax expense:
Current tax expense with respect to the current period
Adjustments recognized in the current period in relation
to the tax expense of prior periods
Sub-total
Deferred tax expense
Income tax expense
For the years ended December 31
2019
2018
612,680
(65,227)
547,453
138,000
685,453
432,645
5,923
438,568
314,655
753,223
(2)
Income tax expense reconciled to net income before income tax expense is as follows (Unit: Korean Won
in millions):
Net income before income tax expense
Tax calculated at statutory tax rate (*)
Adjustments:
Effect of income that is exempt from taxation
Effect of expenses that are not deductible in determining
taxable income
Adjustments recognized in the current period in relation
to the current tax of prior periods
Others
Income tax expense
Effective tax rate
Sub-total
For the years ended December 31
2019
2,723,049
738,476
2018
2,804,872
760,978
(61,730)
(49,418)
31,549
18,639
(65,227)
42,385
(53,023)
685,453
25.2%
5,923
17,101
(7,755)
753,223
26.9%
(*) The applicable income tax rate: 1) 11% for taxable income below 200 million Won, 2) 22% for above 200 million
Won and below 20 billion Won, 3) 24.2% for above 20 billion Won and below 300 billion Won, 4) 27.5% for
above 300 billion Won.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 304
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(3) Changes in cumulative temporary differences for the years ended Deferred 31, 2019 and 2018, are as
follows (Unit: Korean Won in millions):
For the year ended December 31, 2019
Beginning balance
372,346
Business
combination
1,360
Recognized as
income (expense)
(91,781)
Recognized as other
comprehensive income
(expense) (*2)
(3,573)
Ending
Balance
278,352
28,354
(27,507)
(55,846)
(52,345)
6,672
(154,431)
360,087
(318,330)
11,374
75,194
(204,083)
41,485
90
6
(52)
-
-
-
1,131
(1,131)
-
76
(6,927)
(5,447)
(17,648)
(48,217)
(10,486)
(366)
221
(8,011)
21,234
(62,458)
(3,459)
10,958
72,013
(138,000)
(83)
306
-
-
-
-
13,850
143
-
2,228
(5,687)
7,184
10,713
(75,412)
(66,384)
(52,711)
6,893
(162,442)
396,302
(381,776)
7,915
88,456
(144,684)
(94,778)
Gain (loss) on financial assets
Gain on valuation using the
equity method of
accounting
Gain (loss) on valuation of
derivatives
Accrued income
Provision for loan losses
Loan and receivables written
off
Loan origination costs and
fees
Defined benefit liability
Deposits with employee
retirement insurance trust
Provision for guarantee
Other provision
Others (*1)
Net deferred tax assets
(*1) Among the deferred tax assets and liabilities classified as ‘Others,’ the deferred tax asset arising from unused tax
losses amounts to 21,656 million Won.
(*2) Includes 2,737 million Won presented on non-controlling interests.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 127 -
305
K-IFRS 1109 adoption effect
For the year ended December 31, 2018
Beginning
balance
Recognized
as retained
earnings
Recognized as
other
comprehensive
income (loss)
Beginning
balance after
K-IFRS 1109
adoption
Business
combination
Recognized as
income
(expense)
Recognized as
other
comprehensive
income
(expense)(*2)
Ending
Balance
479,065
(150,140)
149,796
478,721
24,482
-
(10,260)
(60,987)
(3,990)
-
(47,697)
47,446
9,777
(137,320)
284,234
(287,333)
30,602
45,153
(72,265)
-
36
-
-
1,370
25,879
4,917
-
-
-
-
-
-
-
-
-
-
-
-
-
-
621
399
-
-
(102,170)
(4,205)
372,346
3,203
(13,617)
4,520
(52,493)
(3,105)
(17,147)
669
360
-
-
-
-
28,354
(27,507)
(55,846)
(52,345)
6,672
(154,431)
24,482
(14,250)
(60,987)
(251)
9,777
(137,284)
284,234
317
43,821
31,715
360,087
(287,333)
31,972
71,032
(67,348)
-
-
-
44
(31,092)
95
(318,330)
(20,598)
4,162
(130,137)
-
-
(6,642)
11,374
75,194
(204,083)
257,451
(74,482)
149,796
332,765
1,381
(314,653)
21,992
41,485
Gain (loss) on
financial
assets
Gain on
valuation
using the
equity method
of accounting
Gain (loss) on
valuation of
derivatives
Accrued income
Provision for
loan losses
Loan and
receivables
written off
Loan origination
costs and fees
Defined benefit
liability
Deposits with
employee
retirement
insurance
trust
Provision for
guarantee
Other provision
Others(*1)
Net deferred tax
assets
(*1) Among the deferred tax assets and liabilities classified as ‘Others,’ the deferred tax asset arising from unused tax
losses amounts to 18,154 million Won.
(*2) Includes 1,429 million Won presented on non-controlling interests.
(4) Unrealizable temporary differences are as follows (Unit: Korean Won in millions):
Deductible temporary differences
Tax loss carry forward
Taxable temporary differences
Total
December 31, 2019
171,714
41,546
(8,024,406)
(7,811,146)
December 31, 2018
272,911
149,035
(868,541)
(446,595)
No deferred income tax asset has been recognized for the deductible temporary difference of 165,679 million
Won associated with investments in subsidiaries and associates as of December 31, 2019, because it is not
probable that the temporary differences will be reversed in the foreseeable future. 6,035 million Won associated
with others, respectively, as of December 31, 2019, due to the uncertainty that these will be realized in the
future.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 306
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No deferred income tax liability has been recognized for the taxable temporary difference of KRW 8,024,406
million associated with investment in subsidiaries and associates as of December 31, 2019, due to the following
reasons:
- The Group is able to control the timing of the reversal of the temporary difference.
- It is probable that the temporary difference will not be reversed in the foreseeable future.
As of December 31, 2019, the expected extinctive date of tax loss carry forward that are not recognized as
deferred tax assets are as follows (Unit: Korean Won in millions):
Tax loss carry forward
-
-
1 year or less
1 – 2 years
2 – 3 years
More than 3 years
41,546
-
(5) Details of accumulated deferred tax charged directly to other equity are as follows (Unit: Korean Won in
millions):
Gain on valuation of financial assets at FVTOCI
Gain on foreign currency translation of foreign
operations
Remeasurements of the net defined benefit liability
Gain on derivatives designated as cash flow hedge
Gain on valuation of financial assets at FVTOCI
Total
December 31, 2019
27,849
1,748
3,774
102,120
280
135,771
December 31, 2018
31,422
(285)
8,183
88,127
1,140
128,587
(6) Current tax assets and liabilities are as follows (Unit: Korean Won in millions)
Current tax assets
Current tax liabilities
December 31, 2019
47,367
182,690
December 31, 2018
20,730
159,078
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 129 -
307
39. EARNINGS PER SHARE (“EPS”)
(1) Basic earnings per share
Basic EPS is calculated by dividing net income attributable to common shareholders by weighted-average
number of common shares outstanding (Unit: Korean Won in millions, except for EPS and number of shares):
Net income attributable to Owners
Dividends to hybrid securities
Net income attributable to common shareholders
Weighted average number of common
shares
outstanding
Basic EPS
.
For the years ended December 31
2018
2019
1,872,207
(4,362)
1,867,845
2,033,182
(151,194)
1,881,988
685 million shares
673 million shares
2,727 Won
2,796 Won
(2) Weighted-average number of ordinary shares
The weighted average number of common shares outstanding is as follows:
For the year ended December 31, 2019
Period
Number of
shares
Dates
Accumulated number
of shares outstanding
during period
Common shares issued at the
beginning of the period
Purchase of treasury stock
Disposal of treasury stock
Disposal of treasury stock(*)
Disposal of treasury stock(*)
2019-01-01 ~ 2019-12-31
2019-01-08 ~ 2019-12-31
2019-03-22 ~ 2019-12-31
2019-09-26 ~ 2019-12-31
2019-11-12 ~ 2019-12-31
673,271,226
(11,453,702)
18,346,782
28,890,707
13,212,670
365
358
285
97
40
Sub-total (①)
Weighted average number of common shares outstanding (②=(①/365)
245,743,997,490
(4,100,425,316)
5,228,832,870
2,802,398,579
528,506,800
250,203,310,423
685,488,522
(*) Woori Bank disposed 42,103,377 shares of Woori Financial Group Inc. which were acquired through
comprehensive stock exchange with the shares of Woori Card Co., Ltd., and its parent company, Woori Financial
Group Inc.
For the year ended December 31, 2018
Period
Number of
shares
Dates
Accumulated number
of shares outstanding
during period
Common shares issued at the
beginning of the period
2018-01-01 ~ 2018-12-31
673,271,226
365
Sub-total (①)
Weighted average number of common shares outstanding (②=(①/365)
245,743,997,490
245,743,997,490
673,271,226
Diluted EPS is equal to basic EPS because there is no dilution effect for the years ended December 31, 2019 and
2018.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 308
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40. CONTINGENT LIABILITIES AND COMMITMENTS
(1) Details of guarantees are as follows (Unit: Korean Won in millions):
Confirmed guarantees
Guarantee for loans
Acceptances
Guarantees in acceptances of imported goods
Other confirmed guarantees
Sub-total
Unconfirmed guarantees
Local letters of credit
Letters of credit
Other unconfirmed guarantees
Sub-total
Commercial paper purchase commitments and others
Total
December 31, 2019
December 31, 2018
89,699
391,688
224,746
6,982,889
7,689,022
193,096
3,081,390
771,378
4,045,864
884,031
12,618,917
125,870
371,525
158,179
6,452,791
7,108,365
305,057
3,322,731
669,677
4,297,465
1,260,587
12,666,417
(2) Details of unused loan commitments and others are as follows (Unit: Korean Won in millions):
Loan commitments
Other commitments
(3) Litigation case
December 31, 2019
103,651,674
5,993,608
December 31, 2018
97,796,704
5,041,314
Legal cases where the Group is involved are as follows (Unit: Korean Won in millions):
Number of cases (*)
Amount of litigation
Provisions for litigations
December 31, 2019
As plaintiff
119 cases
291,880
As defendant
415 cases
391,362
27,029
December 31, 2018
As plaintiff
As defendant
77 cases
494,645
154 cases
246,826
17,925
(*) The number of lawsuits as of December 31, 2019 and 2018 does not include fraud lawsuits, etc. and those
lawsuits that are filed only to extend the statute of limitation.
(4) Recently, the FSS announced ‘Results of interim inspection of Lime Asset Management Co., Ltd and future
countermeasures’ regarding the deferment of the redemption of Lime Asset Management Co., Ltd. The
status of the sale of the Lime Asset Management Co., Ltd. operation deferral fund of the Group is 357.7
billion Won for 1,640 accounts as of the end of December 2019. Currently, a full-time management team is
dispatched to monitor the implementation of the normal repurchase and management plan of lime and
proper performance of internal control work.
(5) The Group decided to enter into a stock sales agreement with a major shareholder of Woori Asset Trust
Co., Ltd (formerly Kukje Asset Trust Co., Ltd) to acquire 44.5% interest (58.6% of voting rights) during
July, 2019, and to acquire additional 21.3% interest (28.0% of voting rights) after a certain period. As a
result, the Group acquired the interest of the first sales agreement in December 2019 and is planning to
acquire the interest of the second sales agreement after a certain period. In regards to this acquisition, the
Group recognized 111,242 million as other financial liabilities for the second sales agreement.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 131 -
309
41. RELATED PARTY TRANSACTIONS
Related parties of the Group as of December 31, 2019 and 2018, and assets and liabilities recognized, guarantees
and commitments, major transactions with related parties and compensation to key management for the years
ended December 31, 2019 and 2018 are as follows:
(1) Related parties
Associates
Related parties
Woori Service Networks Co., Ltd., Korea Credit Bureau Co., Ltd., Korea Finance Security Co., Ltd.,
LOTTE CARD Co., Ltd, Chin Hung International Inc., 2016KIF-IMM Woori Bank Technology
Venture Fund, K BANK Co., Ltd., Well to Sea No. 3 Private Equity Fund, and Others (Dongwoo C
& C Co., Ltd. and other 31 associates)
(2) Assets and liabilities from transactions with related parties are as follows (Unit: Korean Won in millions):
Associates
Woori Service Networks Co.,
Related party
Ltd.
Korea Credit Bureau Co.,
Ltd.
Korea Finance Security Co.,
Ltd.
Chin Hung International Inc.
LOTTE CARD Co. Ltd.
K BANK Co., Ltd.
Well to Sea No.3 Private
Equity Fund
Others (*)
A title of account
Loans
Loss allowance
Deposits due to customers
Accrued expenses
Other liabilities
Loans
Deposits due to customers
Other liabilities
Loans
Loss allowance
Deposits due to customers
Other liabilities
Loans
Loss allowance
Deposits due to customers
Other liabilities
Loans
Loss allowance
Deposits due to customers
Loans
Account receivables
Other assets
Loans
Loss allowance
Deposits due to customers
Other liabilities
Loans
Loss allowance
Other assets
Deposits due to customers
Other liabilities
December 31,
2019
December 31,
2018
23
(1)
1,881
6
429
3
26
-
1,860
(3)
1,371
-
244
(2)
5,381
321
7,500
(30)
2,726
141
24
4
4,490
(8)
714
47
84
(84)
338
5,577
172
69
-
1,967
-
333
7
6,494
19
57
(4)
5,040
10
411
(204)
11,605
2,974
-
-
-
190
-
-
1,857
(9)
356
64
4,783
(324)
9
8,049
165
(*) Others include Saman Corporation,. Woori-Shinyoung Growth-Cap Private Equity Fund, Uri Hanhwa Eureka
Private Equity Fund, Kyesan Engineering Co., Ltd. and DAEA SNC Co., Ltd. etc., as of December 31, 2019 and
2018.
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310
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(3) Gain or loss from transactions with related parties are as follows (Unit: Korean Won in millions):
For the years ended
December 31
Associates
Kumho Tire Co., Inc. (* 1)
Related party
A title of account
Interest income
Reversal of allowance for
credit loss
Woori Service Networks Co., Ltd Other income
.
Interest expenses
Reversal of allowance for
Korea Credit Bureau Co., Ltd.
Associates
Korea Finance Security Co., Ltd.
Chin Hung International Inc
STX Engine Co., Ltd. (*2)
STX Corporation(*2)
LOTTE CARD Co., Ltd.
K BANK Co., Ltd.
Well to Sea No.3
Private Equity Fund
Others (*3,4)
credit loss
Fees expenses
Other expenses
Interest expenses
Fees expenses
Interest expenses
Provisions for allowance
for credit loss
Other expenses
Interest expenses
Provisions for allowance
for credit loss
Interest income
Interest expenses
Reversal of allowance for
credit loss
Interest expenses
Reversal of allowance for
credit loss
Interest income
Fees income
Interest expenses
Provisions for allowance
for credit loss
Fees income
Other income
Interest income
Interest expenses
Reversal of allowance for
credit loss
Interest income
Fees income
Other income
Interest expenses
Reversal of allowance for
credit loss
2019
-
-
32
20
(3)
448
1,423
29
2,608
9
8
112
35
44
-
-
-
-
-
213
593
53
30
1,468
-
1,774
11
(18)
-
1,281
17
55
(5)
2018
1,098
(156,712)
30
14
-
561
580
62
2,310
12
4
146
43
182
333
86
(88,734)
2
(31,210)
-
-
-
-
1,134
19
2,179
9
(30)
233
23
14
40
(147)
(*1) The Group lost significant influence over the entity due to the termination of the joint management procedures of the creditors’
financial institution during the year ended December 31, 2018, and thus the entity was excluded from the list of associates.
(*2) The shares of the entity were sold after it was transferred to assets held for distribution (sale) during the year ended December 31,
2018 and thus was excluded from the list of associates.
(*3) Others include Saman Corporation,. Woori-Shinyoung Growth-Cap Private Equity Fund, Uri Hanhwa Eureka Private Equity
Fund, PCC-Woori LP Secondary Fund, Kyesan Engineering Co., Ltd. and DAEA SNC Co., Ltd. etc., as of December 31, 2019.
(*4) Others include Saman Corporation, Uri Hanhwa Eureka Private Equity Fund, Kyesan Engineering Co., Ltd, DAEA SNC Co.,
Ltd. etc., as of December 31, 2018.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019
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311
(4) Major loan transactions with related parties for the years ended December 31, 2019 and 2018 are as follows
(Unit: Korean Won in millions):
Associates
Well to Sea No. 3 Private Equity
Related parties
Beginning
balance
Loan
Collection
Others
Fund
Korea Finance Security Co., Ltd.
LOTTE CARD Co., Ltd.
1,857
-
-
2,633
1,800
7,500
-
-
-
Ending
balance(*1)
-
-
-
4,490
1,800
7,500
For the year ended December 31, 2019
Related parties
Associates
Kumho Tire Co., Inc.(*2)
Well to Sea No. 3 Private Equity
For the year ended December 31, 2018
Beginning
balance
57,470
Loan
Collection
7,057
-
Others
(50,413)
Ending
balance(*1)
-
Fund
STX Engine Co., Ltd. (*3)
73,810
39,886
16,857
-
88,810
2,177
-
(37,709)
1,857
-
(*1) Payments that occurred for business reasons among related parties are excluded and net increase or decrease was
used for limited credit loan.
(*2) The Group lost significant influence over the entity due to the termination of the joint management procedures of
the creditors’ financial institution during the year ended December 31, 2018, and thus the entity was excluded
from the list of associates.
(*3) The shares of the entity were sold after it was transferred to assets held for distribution (sale) during the year ended
December 31, 2018 and thus was excluded from the list of associates.
(5) Details of changes in major deposits due to customers with related parties for the years ended December 31,
2019 and 2018 are as follows (Unit: Korean Won in millions):
Associates
.
For the year ended December 31, 2019
Related parties
Saman Corporation
Woori Service Networks Co., Ltd
Chin Hung International Inc
Korea Credit Bureau Co., Ltd.
Partner One Value Up I Private Equity
Fund
Korea Finance Security Co., Ltd.
Beginning
balance
2,436
1,180
765
6,000
1,403
535
Borrowings
86
1,460
400
-
Repayment
and others
-
1,460
765
6,000
1,617
25
1,870
560
Ending balance
(*1)
2,522
1,180
400
-
1,150
-
For the year ended December 31, 2018
Related parties
Associates
.
Saman Corporation
Woori Service Networks Co., Ltd
Chin Hung International Inc
Korea Credit Bureau Co., Ltd.
Partner One Value Up I Private Equity
Fund
Korea Finance Security Co., Ltd.
STX Corporation (*2)
STX Engine Co., Ltd.(*2)
Kumho Tire Co., Inc.(*2)
Hyunwoo International Co., Ltd.(*2)
Beginning
balance
2,334
1,135
765
4,000
-
635
330
10,256
37
41
Borrowings
102
1,025
765
12,000
Repayment
and others
-
980
765
10,000
1,803
560
-
-
-
-
400
660
330
10,256
37
41
Ending balance
(*1)
2,436
1,180
765
6,000
1,403
535
-
-
-
-
(*1) Details of payment between related parties and demand deposit due to customers etc. are excluded.
(*2) Excluded from associates due to disposal during the previous year.
(6) There are no major borrowing transactions with related parties for the years ended December 31, 2019 and
2018.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 312
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(7) Guarantees provided to the related parties are as follows (Unit: Korean Won in millions):
December 31,
2019
December 31,
2018
Warranty
Korea Finance Security Co., Ltd.
Korea Credit Bureau Co., Ltd.
Woori Service Networks Co.,
Ltd.
Chin Hung International Inc.
K BANK Co., Ltd.
Well to Sea No.3 Private Equity
Fund
LOTTE CARD Co. Ltd.
400
32
177
32,055
159
210,510
150,000
203
28
Unused loan commitment
Unused loan commitment
131
32,058
15
Unused loan commitment
Unused loan commitment
Unused loan commitment
208,143
-
Unused loan commitment
Unused loan commitment
There no recognized provisions for guarantees provided to the related parties as of December 31, 2019 and
2018, respectively.
(8) Amount of derivatives-related commitments with the related parties
Warrantee
2019
Well to Sea No.3 Private Equity Fund
584,377
439,243
(9) Compensation for key management is as follows (Unit: Korean Won in millions):
For the years ended December 31
2018
Warranty
Open interest
Short-term employee salaries
Retirement benefit service costs
Share-based compensation
Total
For the years ended December 31
2018
2019
13,427
783
2,494
16,704
12,326
489
-
12,815
Key management includes registered executives and non-registered executives. Outstanding assets from
transactions with key management amount to 2,414 million Won and 2,816 million Won, as of December
31, 2019 and 2018 respectively and with respect to the assets, the Group has not recognized any allowance
nor related impairment loss due to credit losses. Also, liabilities from transaction with key management
amount to 6,543 million Won and 6,096 million Won, respectively, as of December 31, 2019 December 31,
2018,
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 135 -
313
42. TRUST ACCOUNTS
(1) Trust accounts of the Bank are as follows (Unit: Korean Won in millions):
Total assets
Trust accounts
December 31, 2019
60,288,399
December 31, 2018
53,560,071
Operating income
For the years ended December 31
2019
1,118,746
2018
1,049,105
(2) Receivables and payables between the Bank and trust accounts are as follows (Unit: Korean Won in
millions):
Receivables:
Trust fees receivables
Payables:
Deposits due to customers
Borrowings from trust accounts
Total
December 31, 2019
December 31, 2018
31,533
392,453
2,730,806
3,123,259
28,703
574,330
3,020,371
3,594,701
(3) Significant transactions between the Bank and trust accounts are as follows (Unit: Korean Won in millions):
Revenue:
Trust fees
Termination fees
Expense:
Total
Interest expenses on deposits due to customers
Interest expenses on borrowings from trust
accounts
Total
For the years ended December 31
2018
2019
171,072
488
171,560
6,684
40,489
47,173
177,913
5,885
183,798
7,813
38,873
46,686
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 314
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(4) Principal guaranteed trusts and principal and interest guaranteed trusts are as follows;
1)
The carrying value of principal guaranteed trusts and principal and interest guaranteed trusts are as
follows (Unit: Korean Won in millions):
December 31, 2019
December 31, 2018
Partial principal guaranteed trusts
Personal trust
Corporate trust
Deposit purpose
Sub-total
Principal guaranteed trusts
Old-age pension trusts
Personal pension trusts
Pension trusts
Retirement trusts
New personal pension trusts
New old-age pension trusts
Sub-total
Principal and interest guaranteed trusts
Development trusts
Unspecified money trusts
Sub-total
Total
9,430
630
1,651
11,711
3,298
516,913
824,735
34,374
7,807
1,742
1,388,869
19
871
890
1,401,470
9,989
633
1,737
12,359
3,564
521,200
819,102
42,187
8,104
2,134
1,396,291
19
835
854
1,409,504
2) The amounts that the Bank must pay by the operating results of the principal guaranteed trusts or the
principal and interest guaranteed trusts are as follows (Unit: Korean Won in millions):
Liabilities for the account
(subsidy for trust account adjustment)
December 31, 2019
December 31, 2018
35
33
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 137 -
315
43. RESTRUCTURING OF THE GOVERNANCE STRUCTURE OF THE GROUP
(1) Establishment of the Group
On November 7, 2018, Woori Bank, a subsidiary of the parent company, obtained approval from the Financial
Services Commission for the establishment of a holding company, and Woori Bank, held an extraordinary
general meeting of shareholders on December 28, 2018 to approve the comprehensive transfer of six companies’
shares of Woori Bank and its subsidiaries Woori Finance Management Research Institute, Woori FIS Co., Ltd.,
Woori Fund Services Inc., Woori Credit Information Co. and Woori Private Equity Asset Management Co. to
establish the financial holding company. As a result, Woori Bank and its subsidiaries Woori Finance Research
Institute Co., Ltd., Woori FIS Co., Ltd., Woori Fund Services Inc., Woori Credit Information Co., Ltd., and
Woori Private Equity Asset Management Co., Ltd. were transferred as wholly-owned subsidiaries to the Group.
The Group’s common stocks were listed on the Korea Exchange on February 13, 2019 and its American
Depositary Shares (ADSs) are being traded underlying common stock on the New York Stock Exchange since
the same date.
(2) Accounting treatment of the Group
From the perspective of the Group, the establishment of the parent company in a comprehensive share transfer of
the controlling, subordinate or subsidiary to restructure the governance under the same control is a transaction
that lacks commercial substance with no change in the assets and liabilities of the subsidiary, with no significant
change in the existing owners’ absolute and relative interest in the Group net assets. Therefore, the Group
accounted for the governance restructuring as it saw the consolidation entity continuing and presented the
consolidated financial statements and notes in comparison. Consolidated financial statements in the comparative
period are consolidated financial statements of Woori Bank and its subsidiaries (before the scheduled sale
classification of five subsidiaries excluding Woori Bank) and consolidated financial statements in the first
(current) period are consolidated financial statements of the parent and its subsidiaries, including Woori Bank.
44. LEASES
(1) The future lease payments under the lease contracts are as follows (Unit: Korean Won in millions):
Lease payments
Within one year
After one year but within five years
After five years
Total
(2) Total cash outflows from lease are as follows (Unit: Korean Won in millions):
Cash outflows from lease
December 31, 2019
For the year ended
December 31, 2019
161,251
232,985
40,698
434,934
217,867
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 316
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(3) Details of lease payments that are not included in the measurement of lease liabilities due to the fact that they
are short-term leases or leases for which the underlying asset is of low value are as follows (Unit: Korean
Won in millions):
For the years ended December 31
Lease payments for short-term leases
Lease payments for which the underlying asset is of low
value
Total
1,964
332
2,296
45. BUSINESS COMBINATION
(1) General
As of August 1, 2019, the Group acquired 73% interests in Tong Yang Asset Management Co., Ltd. and changed
the name of Tong Yang Asset Management Co., Ltd. to Woori Asset Management Corp. As of August 1, 2019,
the Group obtained control of 100% of ABL Global Asset Management Co., Ltd. and transferred it as a
subsidiary as of December 6, 2019, and changed its name to Woori Global Asset Management Co., Ltd.. As of
December 30, 2019, the Group acquired 67.2% interests (including 8.6% interest that Woori Bank held) in the
Kukje Asset Trust Co., Ltd. and changed the name Woori Asset Trust Co., Ltd.. The main reasons for the
business combination are to maximize synergy between the consolidated subsidiaries and to strengthen the non-
bank business portfolio.
The operating profit and net profit of Woori Asset Management Corp., reflected in the consolidated statement of
comprehensive income for the five months after the acquisition date, are 2,365 million Won and 1,720 million
Won, respectively, and the operating and net losses of Woori Global Asset Management Co., Ltd. are 1,751
million Won and 1,360 million Won, respectively. Assuming that the acquisition of Woori Asset Management
Corp., Woori Global Asset Management Co., Ltd. and Woori Asset Trust Co., Ltd. was settled on January 1,
2019, the starting date of the annual reporting period, the operating and net profit of Woori Asset Management
Corp. would be 10,572 and 7,976 million Won, respectively, the operating and net losses of Woori Global Asset
Management Co., Ltd. would be 3,711 million and 2,774 million Won, respectively, and the operating and net
profit of Woori Asset Trust Co., Ltd. would be 41,154 million and 30,981 million Won.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 - 139 -
317
(2)
Identifiable net assets
Identified assets and liabilities as of December 31, 2019 are as follows (Unit: Korean Won in millions):
Assets
Accounts
Cash and cash equivalent
Financial assets at FVTPL
Financial assets at FVTOCI
Financial assets at amortized cost
Woori Asset
Management Corp.
12,914
49,446
26,393
(*1) (*3)
Premises and equipment
Intangible assets (*2)
Deferred tax assets
Others
Sub-total
Financial liabilities
Provision liabilities
Deferred tax liabilities
Others
Liabilities
Sub-total
Fair value of net identifiable assets
16,739
1,610
6,667
1,547
63
115,379
5,129
221
1,085
159
6,594
108,785
Woori Global Asset
Management Co.,
Ltd.
Woori Asset Trust
Co., Ltd.
2,318
2,470
-
25,612
2,145
264
1,551
60
34,420
3,329
108
13
-
3,450
30,970
67,555
654
-
61,792
3,983
39,577
1,524
1,828
176,913
12,180
3,820
8,971
29,410
54,381
122,532
(*1) The acquired financial assets at amortized cost were estimated at fair value. The contractual total of the financial
assets at amortized cost of Woori Asset Management Corp. is 18,680 million Won, and the contractual cash flows
that are not expected to be recovered as of the acquisition date are 1,941 million Won. Woori Global Asset
Management Co., Ltd. has a contractual total of 25,613 million Won for financial assets measured at amortized
cost. The contractual total of Woori Asset Trust Co., Ltd.'s financial assets at amortized cos are 72,686 million
Won and will be recovered as of the acquisition date. Unexpected contractual cash flow is 10,894 million Won.
(*2) The intangible assets of Woori Asset Management Corp. and Woori Asset Trust Co., Ltd. each include 6,456
million Won in customer relationships and 37,074 million Won in order backlog as a result of business
combination and were valued at fair value through the Multi-Period Over-Return Act (MEEM) as they were
judged separately identifiable intangible assets. A multi-term excess profit method is a method to estimate the
future cash flows generated by each intangible asset and to discount the cash flows generated purely by that
intangible asset to its present value by deducting the portion of the asset’s contribution to that cash flow
generation.
(*3) The Group has set 100% loan loss allowance for non-collected accrued income form operation Woori Asset
Management Corp. In addition, although the fund investors have filed a lawsuit seeking compensation for
damages, this financial effect was not reflected in the consolidated financial statements as of the end of the current
term because the possibility of loss and extent of loss cannot be measured reliably at the end of the current term.
If, within one year of the acquisition date, new information obtained about the facts and circumstances that
existed at the acquisition date requires the adjustment of the amounts recognized at the acquisition date, or the
recognition of additional provisions existing at the acquisition date, the accounting for the business combination
will be adjusted.
Woori OverviewBusiness OperationsConsolidated Financial StatementsFinancial Review 318
(3) Goodwill
- 140 -
Recognized goodwill as a result of business combination are as follows (Unit: Korean Won in million):
Woori Asset
Management Corp.
Woori Global Asset
Management Co.,
Ltd.
Woori Asset Trust
Co., Ltd.
Transfer price
Fair value of net identifiable asset
Non-controlling interest (*)
Goodwill
122,450
108,785
29,371
43,036
33,000
30,970
-
2,030
224,150
122,532
40,162
141,780
(*) The non-controlling interest in Woori Asset Management Corp. and Woori Asset Trust Co., Ltd. acquired during
the year ended December 31, 2019, was measured as the proportion of the non-controlling interest in the acquiree’s
identifiable net assets.
In the event of a business combination, the consideration transferred includes the premium paid to acquire Woori
Asset Management Corp., Woori Global Asset Management Co., Ltd. and Woori Asset Trust Co., Ltd. which
results in goodwill. In addition, the consideration paid for the business combination includes expected synergies,
revenue growth, and the amount related to future market growth. However, these benefits through Woori Global
Asset Management Co., Ltd. did not meet the identifiable intangible asset recognition requirements and were not
recognized separately from goodwill.
The Group also acquired a relationship with a customer of Woori Asset Management Corp. and order backlog of
Woori Asset Trust Co., Ltd. as part of the acquisition. These relationships with customers were recognized
separately from goodwill because they met the reparability criteria to meet the recognition requirements for
intangible assets.
(4) Business combination cost
The Group incurred 2,634 million Won, including legal fees and due diligence fees, in relation to the business
combination, and the amount was recognized as a fee expense in the consolidated statement of comprehensive
income of the Group.
(5) Net cash outflow due to business combination
Details of net cash outflows due to business combination are as follows (Unit: Korean Won in million):
Consideration paid in cash
Acquired cash and cash
equivalents
Deduction in total
Woori Asset
Management Corp.
122,450
12,914
109,536
Woori Global Asset
Management Co.,
Ltd.
Woori Asset Trust
Co., Ltd.
33,000
2,318
30,682
224,150
67,555
156,595
46. EVENTS AFTER THE REPORTING PERIOD
The Coronavirus disease (COVID-19) outbreak in January, 2020 is having a negative impacts on the global
economy, including Korea. As a result, the macroeconomic environment is unstable overall. The Group is
closely monitoring the situation; however, the impact on the Group due to the Coronavirus cannot be estimated
as of the financial statements approval for the issuance date.
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 319
GLOBAL NETWORK
(AS OF THE END OF MARCH, 2020)
Woori Bank
Head Office
Woori Bank Narayanganj Branch
Woori America Bank, Woodside Br.
Adamjee Export Processing zone, Shiddhirganj, Narayan-
43-22 50th St. Woodside, NY 11377, USA
The 20th and 21st Floor of Woori Bank Main Office, 51,
Sogong-ro (203, Hoehyeon-dong 1-ga), Jung-gu, Seoul,
ganj-1431 Bangladesh
Phone: 880-2769-2031~34
Phone: 1-718-429-1900
Woori America Bank, Ridgefield Br.
100-792, Korea
Phone: +82-2-2125-2000
Swift: HVBKKRSE
Overseas Branch
New York Agency
Woori Bank Motijheel Sub-Branch
321 Broad Avenue #104 Ridgefield, NJ 07657, USA
AA Tower, 23, Ground Floor, Motijheel C/A, Dhaka
Phone: 1-201-941-9999
Woori Bank Kawranbazar Sub-Branch
Woori America Bank, Palisades Park Br.
A.H.N Tower, Ground Floor, 13 Biponon C/A,
225 Broad Avenue Palisades Park, NJ 07650, USA
Sonargaon Road, Bagla Motor, Dhaka
Phone: 1-201-346-0055
245, Park Ave. 43rd Floor, New York, NY 10167, USA
Chittagong Customer Service Center
Woori America Bank, Closter Br.
Phone: 1-212-949-1900
BEPZA Building, 1st floor of Zone Services Complex in
234 Closter Dock Road Closter, NJ 07624, USA
Chattogram EPZ(CEPZ)
Phone: 1-201-784-7012
LA Br.
3360, West Olympic Blvd. Suite 300, LA, CA90019, USA
Sydney Br.
Woori America Bank, Elkins Park Br.
Phone: 1-213-620-0747~8
Suite 21.02, 126 Phillip Street, Sydney, NSW, Australia
7300 Old York Rd Elkins Park, PA 19027
Phone: 61-2-8222-2200
Phone: 1-215-782-1100
London Br.
9th Floor, 71 Fenchurch Street, London, EC3M 4BR,UK
Woori Bank Dubai Br.
Woori America Bank, Annandale Br.
Phone: 44-207-680-0680
1102A, Level 11, The Gate Building, East Wing,
Seoul Plaza 4231 Markeham St. Annandale, VA 22003, USA
Tokyo Br.
Shiodome City Center 10th Floor, 5-2 Higashi-Shimbashi
Phone: 971-4-325-8365
Woori America Bank, Bayside Br.
P.O. Box 506760, DIFC, Dubai, United Arab Emirates
Phone: 1-703-256-7633
1-Chome, Minato-ku, Tokyo, 105-7110 Japan
Woori Bank India Regional Headquarters
215-10 Northern Blvd. Bayside, NY 11361, USA
Phone: 81-3-6891-5600
Hong Kong Br.
Suite 1401, Two Pacific Place, 88 Queensway, Hongkong
Phone: 852-2521-8016
Singapore Br.
10 Marina Boulevard #13-05 MBFC Tower 2,
Singapore 018983
Phone: 65-6422-2000
Bahrain Br.
P.O. Box 1151, 4th Floor, Entrance 1,
Manama Centre Building, Manama, Bahrain
Phone: 973-17-223503
Dhaka Br.
Suvastu Imam Square (1st & 4th Fl.) 65 Gulshan Avenue,
Dhaka, Bangladesh
Phone: 88-02-5881-3270~3
DEPZ Customer Service Center
Dhaka Export Processing Zone(Old Area), Ganakbari,
Ssvar, Dhaka-1349, Bangladesh
Phone: 880-2778-8030
Woori Bank Chittangong Sub-Branch
World Trade Center Chittagon(2nd Floor)
Plopt No. 102-103, Agrabad Commercial Area,
Chittagong,Bangladesh
Phone: 880-931-728221~4
Woori Bank Uttara Sub-Branch
Paradise Tower(Ground Floor) Plot 11, Sector 3,
Uttara Model Town,Uttara, Dhaka 1230, Bangladesh
Phone: 880-2896-2125~6
Woori Bank Mirpur Sub-Branch
Padma Bhaban(First Floor), 1/9 Mirpur Road
Pallabi, Mirpur-12, Dhaka-1216, bangladesh
Phone: 880-2902-1061~2
Unit 601, 6th floor, Birla Centurion, Century Mills
Phone: 1-718-224-3800
Compound, Pandurang Budhkar Marg, Worli, Mumbai,
Maharashtra-400030, India
Phone: 91-22-6263-8100
Woori Bank Chennai Br.
Woori America Bank, Ellicott City Br.
100352 Baltimore National Pike Ellicott City,
MD 21042, USA
Phone: 1-443-973-3690
Lotte India, 2nd Floor, No.4/169, Rajiv Gandhi Salai(OMR),
Kandhanchavadi, Perungudi Taluk,
Chennai-600096, Tamil Nadu, India
Phone: 91-44-3346-6900
Woori America Bank, Wilshire Br.
3540 Wilshire Blvd. Unit 104, Los Angeles, CA 90010, USA
Phone: 1-213-382-8700
Woori Bank Gurgaon Br.
1st Floor, Salcon Platina Building, MG Road, Sector-28,
Sikanderpur, Gurgaon-122001,Haryana, India
Woori America Bank, Olympic Br.
3360, West Olympic Blvd. Suite #300, LA, CA90019, USA
Phone: 1-213-738-1100
Woori America Bank, Fullerton Br.
5731 Beach Blvd., Buena Park, CA 90621, USA
Phone: 1-714-521-3100
Woori America Bank, Garden Grove Br.
10120 Garden Grove Blvd. Suite 151Garden Grove,
CA 92844, USA
Phone: 1-714-534-6300
Woori America Bank, Centreville Br.
13832 Braddock Road. Centreville, VA 20121, USA
Phone: 1-703-988-9555
Woori America Bank, Irvine Br.
14252 Culver Dr. #G, Irvine, CA 92604
Phone: 1-949-885-3760
Phone: 91-12-4270-6703
Woori Bank Mumbai Br.
Unit 601, 6th floor, Birla Centurion, Century Mills
Compound, Pandurang Budhkar Marg, Worli, Mumbai,
Maharashtra-400030, India
Phone: 91-22-6263-8100
Subsidiary
U.S.A
Woori America Bank
330 5th Avenue New York, NY 10001, USA
Phone: 1-212-244-3000
Woori America Bank, Manhattan Br.
330 5th Avenue New York, NY 10001
Phone: 1-212-244-1500
Woori America Bank, Flushing Br.
136-88 39th Avenue Flushing New York, NY 11354, USA
Phone: 1-718-886-1988
Woori America Bank, Fort Lee Br.
2053 Lemoine Avenue Fort Lee, NJ 07024, USA
Phone: 1-201-363-9300
Woori OverviewBusiness OperationsGlobal NetworkFinancial Review 320
Woori America Bank, Torrance Br.
Woori Bank (China) Ltd. TianJin Br.
Wooribank (China) Ltd. Shanghai Lianyang Sub-Br.
2390 Crenshaw Boulevard, Units C Torrance
NO.1 Building, Aocheng Commercial Square, Binshui West
No.52, Zendai Thumb Plaza Lane 199, FangDian
CA 90501 USA
Phone: 1-310-974-1880
Road, Nankai District, Tianjin, 300381 CHINA
Road,Pudong New District, Shanghai, 200135 CHINA
Phone: 86-022-2338-8008
Phone: 86-021-6882-0608
Woori America Bank, Georgia LPO
Woori Bank (China) Ltd. Shanghai Puxi Sub-Br.
Wooribank (China) Ltd. Beijing Sanyuanqiao Sub-Br.
2472 Pleasant Hill Rd. Duluth, GA30096, USA
1F, Maxdo Center, NO.8 Xingyi Road, Changning District,
1-2F, Tower A, Tianyuangang Center, C2, North Road, East
Phone: 1-404-904-9880
Woori America Bank, San Jose LPO
Shanghai, 200336, China
Phone: 86-021-5208-1000
Third Ring Road, Chaoyang District, Beijing 100027, China
Phone: 86-010-8440-7177
2328 Walsh Ave, Santa Clara CA 95051 USA
Woori Bank (China) Ltd.Beijing Wangjing Sub-Br.
Wooribank (China) Ltd, Shenyang Branch
Phone: 1-415-652-9476
1F,NO.10, FURONG STREET, CHAOYANG DISTRICT,
1F, 2F, Lotte North-Station Arcade,9-8Beiling Street,
Woori America Bank. Northern
164-25 Northern Blvd. Flushing NY 11358, USA
BEIJING 100102, CHINA
Phone: 86-010-8471-8866
Huanggu District, Shenyang, Liaoning 110032, China
Phone: 86-024-8186-0808
Phone: 1-929-362-3330
Woori Bank (China) Ltd. Shanghai Wuzhonglu Sub-Br.
1C, Liaoshen Building, 1068 Wuzhong Road,
Minhang District, Shanghai, 201103, China
Phone: 86-021-6446-7887
Indonesia
Bank Woorisaudara Head Office
Treasury Tower 26th, 27th FL. District 8 SCBD Lot 28 JI.
Woori Bank (China) Ltd. Shenzhen Futian Sub-Br. Room
107, Daqing Building, NO.6027 Shennan Road, Futian Dis-
Jend. Sudirman Kav. 52-53, Jakarta 12190
Phone: 6221-50871906
trict, Shenzhen 518040, China
Phone: 86-0755-8826-9000
Corporate Branch
Treasury Tower 26th, 27th FL. District 8 SCBD Lot 28 JI.
Woori Bank (China) Ltd. Shanghai Jinxiujiangnan Sub-Br.
Jend. Sudirman Kav. 52-53, Jakarta 12190
Woori America Bank. Dallas LPO
1028 MacArthur Dr.Suite #108, Carrollton, TX, 75007
Phone: 1-972-810-0166
Woori America Bank. Chicago LPO
1247 Milwaukee Ave, Suite 207, Glenview, Illinois, 60025
Phone: 1-224-938-9553
Woori America Bank. Seattle LPO
19401 40th Avenue West, Lynnwood, Washington, 98504
Phone: 1-206-948-6691
Woori America Bank, Denver LPO
3033 South Parker Rd. #330 Aurora, CO. 80014
Woori America Bank, Dallas Br.
2405 S. Stemmons FWY, Lewisville, TX 75067
China
Woori Bank (China) Ltd.
No.101-1, 102 MT BLDG, 3999 Hongxin Road,
Minhang District, Shanghai,China, 201101
Phone: 86-021-3432-1116
Woori Bank (China) Ltd. Beijing Shunyi Sub-Br.
1F, Tower A, AMB Building, 2 Cangshang Street,
Shunyi District 101300, China
Phone: 86-010-8945-2220
Woori Bank (China) Ltd. DaLian Br.
2F-218, Yoma IFC, NO.128 Jinma Road,
Dalian Development Area, Dalian, P.R. China 116600
Floor 11-12, Block A Building 13, District4, Wangjing
Phone: 86-0411-8765-8000
East Park, Chaoyang District Beijing China 100102
Phone: 86-010-8412-3000
Woori Bank (China) Ltd. Zhangjiagang Sub-Br.
B104/B205 Huachang Oriental Plaza, 11 Renmin East Road,
Woori Bank (China) Ltd. Head office business department
Zhangjiagang Jiangsu, 215600 China
Floor1 Block B Building 13 District4 Wangjing East Park
Phone: 86-0512-5636-6696
Chaoyang District Beijing China 100102
Phone: 86-010-8441-7771
Woori Bank (China) Ltd. Chengdu Br.
No.302-306, 3F, Ping'an Fortune Center, No.1, Renmin
Woori Bank (China) Ltd. Beijing Br.
South Road(Section 3), Chengdu, Sichuan,China,610041
1F, West Tower, Twin Towers, B-12 Jianguomenwai
Phone: 86-512-028-6557-2336
Avenue, Chaoyang District, Beijing 100022, CHINA
Phone: 86-010-8453-8880
Woori Bank (China) Ltd. Weihai Br.
No.106-1,No.106-2,No.106-3 Attached Qingdao
Woori Bank (China) Ltd. Shanghai Br.
Mid-Road,Weihai, Shandong Province, China
104B,502, Dongfangchunyi Building 1, 5F, Eshan Avenue
Phone: 86-0631-599-6000
505 Pudong New Area, Shanghai,200122, China
Phone: 86-021-5081-0707
Woori Bank (China)Ltd.Tianjin Dongmalu Sub-Br
1-2F,No. 4 of TowerC,Yuding Plaza,Qixiang Street),
Woori Bank (China) Ltd. Shenzhen Br.
Dongma Road, Nankai District, Tianjin, 300090, China
B0105–B0210 Rongchao Landmark, 4028 Jintian Road,
Phone: 86-022-8776-9000
Futian District, Shenzhen, China
Phone: 86-0755-3338-1234
WooriBank (China) Ltd. Chongqing Br.
Shop 2, First Floor, Jinjia International Building, No.10,
Woori Bank (China) Ltd. Suzhou Br.
GuiHua Street Branch Road, JiangBei District,
6F Building #58 Suzhou Center, Suxiu Road,Suzhou
ChongQing, China, 400000
Industrial Park, Jiangsu, China
Phone: 86-0512-6295-0777
Phone: 86-023-6152-2222
Phone: 6221-50871888
Wastukancana Branch
Jl Wastukencana No. 79 - Kota. Bandung
Phone: 6222-4209940
Cirebon Branch
Komplek Cirebon Super Blok (CSB) Mall Office Park
Kav. No. 11 Jl. Cipto
Phone: 62231-242006
Bogor Branch
Jl. Pangkalan Raya No. 8, Warung Jambu - Bogor/16151
Phone: 62251-8377887
Surapati Core Branch
Komp Surapati Core F-01-02 Bandung
Phone: 6222-87241326
Surabaya Branch
Kompleks Ruko 21, Jl. Raya, Gubeng
No.68E - Surabaya/60281
Phone: 6231-5041906
Semarang Branch
Ruko Imam Bonjol Square Kav 4 - Kota. Semarang
Phone: 6224-3521906
Tasikmalaya Branch
Ruko Plaza Asia Blok A5-A6, Jl. HZ. Mustofa
No. 326 - Tasikmalaya/46126
Phone: 62265-2351906
Yogyakarta Branch
Jl. Mangkubumi No. 45 - Yogyakarta/55232
Phone: 62274-549280
Denpasar Branch
Ruko Griya Alamanda blok 3-4,Jl. Cok Agung Tresna
Renon-Denpasar/80235
Phone: 62361-263755
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 321
The Gedung Energy Branch
Gd The Energy Lot 11 A SCBD, Jl. Jendral Sudirman
Kav 52 - 53, Jakarta/12190
Phone: 6221-29951906
Medan Branch
Jl. Zainul Arifin No. 53A
Phone: 6261-42007100
Makassar Branch
Majalengka Sub-Branch
Jl. KH. Abdul Halim No.447 Majalengka/45411
Phone: 62233-8285460
Kuningan Sub-Branch
Ampera Branch
Jl. Gunung Latimojong, Ruko Metro Square Blok E No. 1
Jl. Dewi Sartika No.4/45512
Jl. Ampera Raya No. 20 Gd.Medco III/12560
Phone: 6241-18001859
Phone: 62232- 8880938
Phone: 6221-7821756
Purwokerto Branch
Jl. Jenderal gatot Subroto No.78
Purwokerto - Jawa Tengah/53116
Phone: 62281-622212
Malang Branch
Jl. Letjen Sutoyo No. 27 Malang- Jawa Timur/65141
Phone: 62341-421906
Solo Branch
Buah Batu Sub-Branch
Jl. Buah Batu No. 58 Bandung/40265
Phone: 6222- 7306347
Indramayu Sub-Branch
Jl. DI. Panjaitan No.103/45212
Phone: 62234-276236
Kopo Sub-Branch
Cibubur Sub-Branch
Komp Ruko Mas J-9 Jl. Kopo Cirangrang/40225
Cibubur Times Square Blok B1/1 Jl. Alternatif Cibubur KM
Phone: 6222-5436802
Cimahi Sub-Branch
3 Kel. Jatiraya, Kec. Jastisampurna Bekasi/17435
Phone: 6221-84305050
Jl. Raya Cibabat No. 310 Cimahi/40213
Cikampek Sub-Branch
Phone: 6222-6634656
Jl. Terusan Sudirman No. 6B(Sudirman Center)/41373
Jl. Ronggo Warsito No. 53 Kota, Solo - Jawa Tengah/57131
Phone: 62264-8385171/ 8385172
Phone: 62271-633600
Tangerang city Branch
Tangerang City Business park Blok F/50 Jl. Jend. Sudirman
No.1 Tangerang/15118
Phone: 6221-29529226
Pelembang Branch
Jl. Basuki Rahmat No. 886 A - Palembang/30127
Phone: 62711-315828
Sukabumi Branch
Jl. Jenderal Sudirman No. 31-Sukabumi/43111
Phone: 62266-6251906
Sukajadi Sub-Branch
Jl Sukajadi No. 248 Bandung
Phone: 6222-2042248
Soekarno Hatta Sub-Branch
Jl. Soekarno Hatta No. 618 F/40286
Phone: 6222-7509905
Pemuda/Rawamangun Sub-Branch
Jalan Paus No 91F, Pulogadung, Jakarta Timur
Phone: 6221-47862070
Sumedang Sub-Branch
Jl. Prabu Geusan Ulun No.76/45311
Phone: 62261-206527
Depok Sub-Branch
Jl. Margonda Raya No.1 Rt 001/011 Kelurahan Depok
Kecamatan Pancoran Mas/16431
Phone: 6221-7522091
Salatiga Sub-Branch
Ruko Wijaya Square B5 Jl.Diponegoro
No. 110 Salatiga/50711
Phone: 62298-311828
Sidoarjo Sub-Branch
Jl. KH. Mukmin No.11 Blok B-7 Sidoarjo/60281
Phone: 6231-8922842
Pekalongan Branch
Jl. KH. Mansyur No.64, Perkalongan
Phone: 62 285 4460505
Madiun Branch
Jl. Diponegoro No. 110, Madiun
Phone: 62 351 4773000
Serang Sub-Branch
Jl. KH. Abdul fatah Hasan No.53 Kel. Cipare Serang/42124
Phone: 62254-224142
Commercial Center Cikarang Sub-Branch
Cikarang Commercial Centre Blok A1-2, Jl. Cibarusah KM.
40 No. 2 Kampung pasir sari kec. Cikarang Selatan/17550
Mojokerto Sub-Branch
Jl. Gajah Mada No.85B/60319
Phone: 62321-383444
Cianjur Sub-Branch
Jl. Abdulah Bin Nuh No.15/43253
Phone: 62263- 260941, 260943
Jamber Branch
Phone: 6221-89835720
Pamulang/Ciputat Sub-Branch
Jl. Gajah Made No. Ruko Gajah Mada Square Block A2-3
Phone: 62 331 421648
Kediri Bran
Jl, Brawijaya No. 25A Kota Kederi
Phone: 62 354 4526726
Jl. RE. Martadinata No. 167 B RT.03 RW. 05 Cipayung,
Atrium/Cideng Sub-Branch
Jalan Keseman No 2, Kota. Jakarta Pusat
Phone: 6221-3451964
Kebon Jeruk Sub-Branch
Jl. Kelapa Dua Raya(RayaPanjang) No.2, Rt 008, Rw 002
Ciputat, Kota Tangerang Selatan
Phone: 6221-7403205,7443335
Sumber Sub-Branch
Jl. Dewi Sartika No. 57 Sumber/45611
Phone: 62231-8330618
Purwakarta Branch
Kel. Kelapa Dua Kec. Kebon Jeruk/12130
Jl. Basuki Rahmat No. 94, Purwakarta/41114
Phone: 6221-53660160
Bantul Sub-Branch
Phone: 62264-8227474
Subang Branch
JL. Ahmad Yani No. 36/41211
Phone: 62260-421014
Diponegoro Sub-Branch
Jl. Diponegoro No. 28 Bandung/40251
Phone: 6222-87831928
Lembang Sub-Branch
Karawaci Tangerang Branch
Jl. Grand Hotel Lembang No.25 Bandung/40391
Ruko Pinangsia Blok H No. 1 Lippo Karawaci Kel. Cibodas
Phone: 6222-2784797
Tangerang/15139
Phone: 6221-55772345
Garut Branch
Jl. Ahmad Yani No.33/44117
Phone: 62262-544672
Jababeka Cikarang Sub-Branch
Ruko Metro Boulevard Kav. A Jl. Niaga Raya No. 10
Kawasan Industri Jabeka/17835
Phone: 6221-89836020/ 89837020
Jl. Jenderal Sudirman No. 130 Kabupaten Bantul/55713
Phone: 62274-367514
Balaraja Sub-Branch
Komplek Ruko Balaraja Center Blok A No.2 Jl. Raya Serang
Km. 24 Talaga Sari Balaraja-tangerang/15610
Phone: 6221-29015618
Ciledug Sub-Branch
Ruko Dian Plaza Jl. Raden Fatah No. 8A Kelurahan
Sudirman Selatan,Ciledug/15225
Phone: 6221-7330545
Woori OverviewBusiness OperationsGlobal NetworkFinancial Review 322
Gunung Sabeulah Sub-Branch
Pangalengan Sub-Branch
Banjar Sub-Branch
JL. Gunung Sabeulah Kel.Tawangsari Kec. Tawang kota
Jl. Raya Pintu Pangalengan KM-1/40378
Jl. Letjen Soewarto No.92/46321
Tasikmalaya/46112
Phone: 62265-326147
Magelang Sub-Branch
Ruko Metro Square Blok F No.25/56172
Phone: 62293-326498/326499
Phone: 6222-5979222
Phone: 62265-740557
Megablock Cilegon Sub-Branch
Boyolali Sub-Branch
Jl. Raya Ahmad Yani Komp. Cilegon Green Megablock D3
Jl. Pandanaran No.179 B Kab.Boyolali/57313
No. 17 - Kota. Cilegon
Phone: 62254-8484772
Phone: 62276-323655
Martadinata/Cihapit Sub-Branch
Jl. RE Martadinata Pav 123 Bandung/40114
Padalarang Sub-Branch
Rangkasbitung Sub-Branch
Jl. Raya Padalarang No.463 H/40553
Jl Hardiwangun No.6 B Rangkasbitung - Kab. Lebak
Phone: 6222- 7107090
Phone: 6222-6803940/41
Patrol Sub-Branch
Phone: 62252-203612
Tabanan Sub-Branch
Radio dalam Sub-Branch
JL. Radio dalam raya No.4 Kel. Gandaria Utara Kec. Kebay-
Jl. Raya Patrol Anjatan Blok Bunder No. 52/45256
Jl. Ngurah Rai No. 73 Kediri/82121
Phone: 62234-5613627
Phone: 62361-814160
oran baru Jakarta selatan/12160
Phone: 6221-7211005
Gianyar Sub-Branch
Jl. By.Pass Dharma Giri No.99/80511
Phone: 62361-8958295
Gresik Sub-Branch
Surabaya /Darmo Boulevard Sub-Branch
Singaraja Sub-Branch
Office Park II B.2 No.11
Phone: 6231-7381906
Soreang Sub-Branch
Jl. Ngurah Rai No. 16 Singaraja Kelurahan Kendran
Kecamatan Buleleng/81112
Phone: 62362-25098
Ruko KIG Jl. Tri Dharma Kav. A-14/61117
Jl. Raya Soreang No.412/40900
Manonjaya Sub-Branch
Phone: 6231-3981758
Phone: 6222-5896880
Jl. RTA. Prawira Adiningrat No.214 A Desa Manonjaya kec.
Karawang Sub-Branch
Ujung Berung Sub-Branch
Jl. Tuparev No.499 (Johar) Kab.Karawang
Jl AH Nasution No. 28 - Kota.Bandung
Phone: 62267-8454873/8454874
Phone: 6222-7834128
Cibinong Sub-Branch
Jl. Raya Mayor Oking No.158 V/16918
Phone: 6221-87904397
Jemur Sari/Surabaya selatan Sub-Branch
Jl. Raya Jemursari No. 15C Surabaya/60237
Phone: 6231-8480454
Singaparna Sub-Branch
Lur Agung Sub-Branch
Jl. Raya Timur No.45 Singaparna/46416
Jl. Siliwangi No. 18 Kec Luragung, Kab Kuningan/45581
Phone: 62265-543111-3
Phone: 62232-870016
Ciamis Sub-Branch
Ruko Jl Pasar Manis No. 35 -Kab. Ciamis
Phone: 62265-772221
Sleman Sub-Branch
Pangandaran Sub-Branch
Jl. Parapat, Desa Pangandaran,
kec pangandaran kab ciamis/46396
Phone: 62265-630400,630010
Jl. Magelang KM 12.8 No.200/55514
Purwodadi Sub-Branch
Phone: 62274-865922
Losari Sub-Branch
Jl. Letjen S. Parman No. 20 Kecamatan Pabuaran ,
Kab. Cirebon Jawa Barat
Phone: 62231- 8832738-39
Bekasi/Pondok Gede Sub-Branch
Jl Raya Jatimakmur Blok A No. 20 Pondok Gede, Kota
Jl. Letjend. S. Parman No. 13 Kel. Purwodadi Kec.
Purwodadi Jawa Tengah/58111
Phone: 62292-423399
Leuwiliang Sub-Branch
Jl. Raya Jasinga 11A Kel. Cibeber,
Kec. Leuwiliang Kab Bogor/16640
Phone: 62251-8640297
Manonjaya-Tasikmalaya
Phone: 62265-380510
Surabaya Utara /kertajaya Sub-Branch
Jl. Kertajaya Indah No. 9/F-105 Surabaya/60161
Phone: 6231-5927202
Batu Sub-Branch
Jl. Brantas No.49 Batu-Malang/65314
Phone: 62341-513709
Palimanan Sub-Branch
Jl. Otto Iskandardinata No.503 Palimanan
Phone: 62231-343950
Cibadak Sub-Branch
Jl. Raya Suryakencana RT 03 RW 08,
Cibadak - Kab. Sukabumi
Phone: 6266-531915
Kemang Pratama Bekasi Sub-branch
Jl. Niaga Raya Blok P No.22C RT 001/021 Kel. Bekasi
Phone: 62254-369755
Wates Sub-Branch
Jl. Kolonel Sugiyono No.3-Wates
Phone: 62274-6657325
Bekasi Ruko Taman Jatimakmur Indah
Ciawi Tasikmalaya Sub-Branch
Karangnunggal Sub-Branch
Phone: 6221-82611045-46
Jl. Perjuangan No.80 Kp.Karanganyar Rt. 04 Rw. 05 Desa
Jl. Raya Karangnunggal KP.Karangmekar RT/RW 03/09
Kudus Sub-Branch
Jl. Sunan Kudus No.5 a/509000
Phone: 62291-4249241
Pamanukan Sub-Branch
Jl. Eyang Tirtapraja No.54 Kab.Subang/41254
Phone: 62260-551773
Majalaya Sub-Branch
Jl. Alun-alun utara/Jl. Tengah komp ruko permata
majalaya Blok C6/40382
Phone: 6222-85963799
Pakemitan Kec Ciawi Kab. Tasikmalaya/46156
Desa Hegarwangi Kec. Bantarkalong Kab.
Phone: 62265-455163,455167
Phone: 62265 - 2584571/2584572
Cilacap Sub-Branch
Wonogiri Sub-Branch
Jl. Jend. A Yani No.46 Cilacap/53212
Jalan Ahmad Yani No 66, Wonogiri
Phone: 62282-537929
Jombang Sub-Branch
Phone: 62271-633600
Kawali Sub-Branch
Jl. KH. Wahid Hasyim No.71 Kota Jombang - Jawa
Jl. Siliwangi No.262, Desa Kawali mukti
Timur/61411
Phone: 62321-878906, 62321-872906
Phone: 62265 791560
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 323
Kepanjen Sub-Branch
Jl. Kawi Ruko B7, Kepanjen
Phone: 6234 1-379840
Pamekasan Sub-Branch
Jl. Kabupaten No.114
Phone: 62324 333905/62324 333906
Kebumen Sub-Branch
Jl. Ahmad Yani No.20, Kubumen
Phone: 62287 3878168
Mangga Dua Sub-Branch
Cikajang Sub-branch
Jl. Raya Cikajang No. 80 Garut
Phone: 6262-576094
Cilimus Sub-branch
Lawang Sub-branch
Ruko Lawang View Kav 8, JI. Thamrin,Kecamatan Lawang
Phone: 62-341-423540
Purworejo Sub-branch
Jalan Raya Cilimus RT 017/04, Desa Cilimus Kecamatan
JI. Ahmad Yani no.93, Purworejo
Cilimus, Kabupaten Kuningan
Phone: 62232-615411
Kendal Sub-branch
Jl. Raya Utama No.9 weleri kendal
Phone: 62294-644704
Phone: 62-75-321457
Brebes Sub-branch
Jl. Jenderal Ahmad Yani No 26 F
Phone: 6288-34511421
Karanganyar Sub-branch
Ruko Harco Mangga Dua Blok L. No.5
Wonosari Sub-branch
Jalan Raya Palur Jurug RT 004/RW 001 Desa Ngringo, Kec.
Phone: 6221 62306495
Jl. KH. Agus Salim No.71A Wonosari - Kab Gunungkidul
Jaten, Kab. Karanganyar
Phone: 62274-3950673
Phone: 62-271-6882712
Kelapa Gading Sub-Branch
Jl. Boulevard Barat Ruko MOI Blok I No.15
Purbalingga Sub-branch
Phone: 62 21 29364053
Kayu Agung Sub-Branch
Jl. Ahmad Yani No.42 Purbalingga
Phone: 62281-895553
Jl. Letnan Muthtar Saleh, Kayuagung, Palembang,
Sragen Sub-branch
South Sumatra
Phone: 62-711-315828
Klaten Sub-Branch
Jl. Pemuda No. 246 Klaten, solo
Phone: 62-271-633600
Jl. Sukowati No.156 Sragen
Phone: 62271-895015
Bintaro Sub-branch
Jl Kesehatan No 18B, jakarta
Phone: 6221-7374693
Dalem Kaum Cash-Office
Jl Dalam Kaum No. 5 - Kota.Bandung
Phone: 6222-4211906
Batujajar Cash-Office
Jl. Batujajar No.324 Bandung
Phone: 6222-86861018/17/15
Antapani / Suci Cash-Office
Jl. Terusan Jakarta Ruko Pelangi Antapani No. 4 Antapani
Bandung
Phone: 6222-7279740
Parung Sub-Branch
KCP PROBOLINGGO
Jl. Rayal Parung RT002/RW006, Kacamatan Parung, Kabu-
Ruko Manunggal No. 2, Jl. Soekarno Hatta
Jatinangor Cash-Office
Phone: 6233-54491787
Jl. Raya Jatinangor KM 20.5 KKBI IKOPIN/45363
paten Bogor
Phone: 62-2151-861-9559
Pasuruan Sub-Branch
KCP PANDEGLANG
Jl. Raya Labuan KM 1
Jl. Panglima Sudirman No.45 Ruko I, Pasuruan, Malang
Phone: 6225-35554739
Phone: 62-343-561-4700
Pati Sub-Branch
Jl. Ir. Susato No.40 Pati, Jawa Tengah
Phone: 62-24-352-1906
Sumenep Sub-Brancch
JI. Trunouyo No. 244 Sumenep
Phone: 62-3428-6762234
KCP PASAR ATOM
Jl. Pangampon No. 75
Phone: 6231-3503350
KCP CITRA RAYA
Ruko Cikupa Niaga Mas Blok A No. 12
Phone: 6212-9014270
KCP CAKUNG
Pelabuhan Ratu Sub-Branch
Jl. Jawa Raya Blok A 14 No. 7 (Kawasan Berikat Nusantara)
Jl. Siliwangi Rt/Rw 02/18, Desa Pelabuhan Ratu
Phone: 6214-84556
Phone: 62-266-6249715
KCP PANTAI INDAH KAPUK
Posco Cilegon Sub-branch
Jl. Marina Raya, Rukan Cordoba Blok A Nomor 11
Annex Building Lt. 1 Jl. Afrika No.2 Krakatau Posco
Phone: 6212-2571768
Phone: 6222-7781587
Darmaraja Cash-Office
Jl. Raya Darmaraja No.253 desa Darmaraja,
Kec Darmaraja Kab.Sumedang/45372
Phone: 62262-429000,429069,428478
Cililitan Asabri Cash-Office
Jl. Mayjen Sutoyo No.11 Gedung PT Asabri (persero) Jl.
Cililitan - jakarta Timur/13630
Phone: 6221-80876494
Jatibarang Cash-Office
Jl. Letnan Joni No.178 Kec.
Jatibarang - Kab Indramayu/45273
Phone: 62834-352911
Pacar Anyar / Taman Topi Cash-Office
Jl. Sawojajar No.12 B, Kota. Bogor
Phone: 62251-8574423
Cilegon/42435
Phone: 62254-369755
KCP CENTRAL PARK
Ruko Garden Shopping Arcade No. 9 A-C
Ciwai bogor / Juanda Cash-Office
Jl. Raya Sukabumi Km 2 Pertokoan MJ Center, Kab. Bogor
Union Square Cikarang Sub-branch
Phone: 6212-9334623
Ruko Union Square Blok A No.6 Lippo Cikarang,
Cikarang Selatan
Phone: 6221-89909797
Sadang Sub-Branch
Sadang Terminal Square No.07,08,25 Jl. Raya Sadang
Purwakarta/41181
Phone: 62264-8220180
KCP JEPARA
Jl. Pemuda No. 21 D-E
Phone: 6291-4290507
KCP BANJARNEGARA
Jl. Letjend S Parman No. 29
Phone: 6286-5963716
Phone: 62251-8243874
Ungaran Cash-Office
Ruko permata hijau No.1 Jl. MT Haryono No. 16
Kel Ungaran Kec Ungaran Barat Kab. Semarang/50511
Phone: 6224-76911017
Serang / pamila CilegonCash-Office
Jl. Raya Serang- pandeglang KM 11 Lingkungan waru Lor,
Desa/kel. Kamanisa Kec Curug Kota serang/42117
Phone: 62254-222133
Woori OverviewBusiness OperationsGlobal NetworkFinancial Review 324
Gading Serpong Cash-Office
Woori Bank Brasil Bom Retiro Branch
Kungyangon Branch
Jl. Boulevard Raya Gading Sepong, Ruko Alexandrite 3,
Rua Tres Rios, 261 Andar 2, Bom Retiro, Sao Paulo SP, Brasil
No 540, Yadanar Pone 2nd St, Kangyi / Magyi Ward, Kung-
No.21, Kabupaten Tangerang
Phone: 62-21-5421-2159
Bojonergoro Cash-Office
Jl. Untung Suropati Ruko Adipura Block A-11
Phone: 62-353-311271
Surya symantri Cash-Office
Jl. Surya Sumantri No. 06 RT. 05 RW. 04
Phone: 62-22-2021760
Asabri Cash-Office
Jl. Gayungan PTT, No. 43, Surabaya – 60235,
Gedung Kantor Asabri Surabaya
Phone: 62-31-82517971
KK KEMANG
Kemang Square Lt 2, Unit I-11 & I-12, Jl.
Kemang Raya No. 3 A
Phone: 6221-22716210
KK CIKANDE
Jl. Raya Jakarta - Serang KM 68,
Ruko Grand Permata No. 10
Phone: 6225-47951546
Kalasan Cash-Office
JL. Laksda Adisucipto KM.10, Ruko Airport Square
RT.001 RW.001 Purwomartani, Kalasan, Sleman,
D.I Yogyakarta 55281
Phone: 6227-44332487
Dalem Kaum Functional Office
JL. Dalem Kaum No.5 Bandung
Phone: 6222- 4233810
Phone: 55-11-3511-3350
Myanmar
Woori Finance Myanmar Plc.
115/A, Pyay Road, Saw Bwar Gyee Kone Ward(10 miles),
Insein Township Yangon, Myanmar
Phone: 95-01-643798
MingaladonI Branch
115/A, Pyay Road, Saw Bwar Gyee Kone Ward(10 miles),
Insein Township Yangon, Myanmar
Phone: 95-01-643798
NorthOkkalapa Branch
No. M(56), Thiriyadanar Wholesale Market
NorthOkkalapa Township, Yangon, Myanmar
Phone: 95-99-6889-2300
MingaladonII Branch
4F, 115/A Pyay Road, Saw Bwar Gyee Kone Ward(10miles),
lnsein Township, Yangon Myanmar
Phone: 95-1-643798
Nyaungdon Branch
Room No. 103, 1st Street, 5 Quarter, Nyaungdon
Township, Ayarwaddy, Myanmar
Phone: 95-99-7674-7709
Taikkyi Branch
Room No.9, Natsinkone Road, Ohtan Ward,
Taikkyi Township, Yangon, Myanmar
Phone: 95-9-7717-81028
Hmawbi I Branch
2F No(26) Tatkyee Kone village, Hmawbi Township,
Hong Kong
Woori Global Markets Asia Limited
Rooms 1907-1909, 19/F, Gloucester Tower,
Yangon, Myanmar
Phone: 95-9-974563586
Hmawbi II Branch
The Landmark, 15 Queen's Road Central, Hong Kong
1F No(26) Tatkyee Kone village, Hmawbi Township,
Phone: 852-3763-0888
Russia
AO Woori Bank
Yangon, Myanmar
Phone: 95-9-97456395
Maubin I Branch
8th floor., Lotte Plaza, 8, Novinsky Boulevard,
Plot No(34), No(396), Building 01, Yei Le road, Ward 7,
Moscow, 121099, Russia
Phone: 7-495-783-9787
Maubine Township, Ayeyarwaddy, Myanmar (2F)
Phone: 95 9 9712 25895
AO Woori Bank Saint-Petersburg Br.
Maubin II Branch
1st Floor, Atlantic City, 126 Savushkina Street,
Plot No(34), No(396), Building 01, Yei Le road, Ward 7,
Saint-Petersburg, 197374, Russia
Phone: 7-812-327-9787
Maubine Township, Ayeyarwaddy, Myanmar (1F)
Phone: 95 9 9616 12763
AO Woori Bank Vladivostok Representative Office
Kawhmu Branch
Vladivostok Business-Center Office No. 614,
No 192/B, Bogyoke St. South Wd Kawhmu Townshop,
29, Semenovskaya Str. Vladivostok, 690091, Russia
Yangon
Phone: 7-423-240-7014
Phone: 95 9 9742 91112
Brazil
Woori Bank Brasil
Insein Branch
115/A, Pyay Road, Saw Bwar Gyee Kone Ward(10 miles),
Avenida das Nacoes Unidas, 14,171, Crystal Tower,
Insein Township Yangon, Myanmar
Conj.803, Vila Gertrudes, 04794-000, Sao Paulo-SP,Brasil
Phone: 95 1 643798
Phone: 55-11-3511-3300
yangon Township, Yangon, Myanmar
Phone: 95 9 975 890019
Zalun Branch
Bogyok St. Nyaung Pin Zay Ward, Zalun Township, Ayeyar-
wady, Myanmar
Phone: 95 9 960996083
Kyimyindaing Branch
No. 101, Tha Yet Taw(3) Upper St. Tha Yet Taw Ward,
Kyimyindaing Township, Yangon, Myanmar
Phone: 95 9 960996092
Hinthada I Branch
No. 49, U Wisarra St. Pha Tar Gyi Ward,
Hinthada Township, Ayeyardady, Myanmar
Phone: 95 9 960996099
Hlaing Branch
No. 101, Tha Yet Taw(3) Upper St. Tha Yet Taw Ward,
Kyimyindaing Township, Yangon, Myanmar
Phone: 95 9 960996089
Hinthada II Branch
No. 93, Nat Maw St. Panbetan Ward,
Hinthada Township, Ayeyarwady, Myanmar
Phone: 95 9 961010611
Hinthada III Branch
No. 93, Nat Maw St. Panbetan Ward,
Hinthada Township, Ayeyarwady, Myanmar
Phone: 95 9 961010611
Twantay Branch
No. 49, Bo Kyoke St. Kon Gyan(Middle) Ward,
Twantay Township, Yangon, Myanmar
Phone: 95 9 961010511
Pyapon I Branch
No. 18C, 8th St. 9th Ward, Pyapon Township,
Ayeyarwady
Phone: 95 9 950311093
Pyapon II Branch
No. 18C, 8th St. 9th Ward, Pyapon Township,
Ayeyarwady
Phone: 95 9 950311096
Pantanaw I Branch
No. 1, Sel Myaung St. Myo Kwet Thit 1,
Pantanaw Township, Ayeyarwady, Myanmar
Phone: 95 9 764433931
Pantanaw II Branch
No. 1, Sel Myaung St. Myo Kwet Thit 1,
Pantanaw Township, Ayeyarwady, Myanmar
Phone: 95 9 764433932
Gyobingauk I Branch
No. 154, Ashay Myopat St. Pan Tin Ward,
Gyobingauk Township, Bago, Myanmar
Phone: 95 9 764433935
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 325
Gyobingauk II Branch
No. 154, Ashay Myopat St. Pan Tin Ward,
Gyobingauk Township, Bago, Myanmar
Phone: 95 9 764433936
Taungwingyi Branch
No. 174, Ohntaw No. 2 Ward,
Taungdwingyi Township, Magwey
Phone: 95-9-692687628
CEBU TABUNOK BRANCH
Ground Floor, AGSy Bldg., National Hi-Way,
Tabunok Talisay City, Cebu
Phone: 63-32-272-2955
Zigon Branch
Natmauk Branch
CEBU MANDAUE PACIFIC MALL METRO BRANCH
Hlaing Htate Khaung Tin St. No. 1 Ward,
No.22, Plot U Paing No.105, East Aung San Ward,
Ground Floor, Mandaue Pacific Mall Metro
Zigon Township, Bago, Myanmar
Phone: 95 9 780 113417
Natmauk Township, Magway
Phone: 95-9-891504155
National Highway corner M.B. Fernan Ave.
Estancia, Ibabao, Mandaue City, Metro Cebu
Phone: 63-32-239-1072
Paungde I Branch
Nattalin Branch
Plot No. 79, Shwetaung Street, Min Kwet 3, Ward,
No.52, Apyin Tharzi Street, Tharzi Ward,
CEBU MAMBALING BRANCH
Paungde Township, Bago, Myanmar
Phone: 95 9 780114012
Paungde II Branch
Plot No. 79, Shwetaung Street, Min Kwet 3, Ward,
Paungde Township, Bago, Myanmar
Phone: 95 9 780114068
Lewe I Branch
No. 17 Plot, Min Wine Yat, No. 4 Ward,
Lewe Township, Nay Pyi Taw, Myanmar
Phone: 95 9 402187901
Pyinmana I Branch
No. 181, Yarza Htarni St. Aung Thar Yar Ward,
Pobbathiri Township, Nay Pyi Taw, Myanmar
Phone: 95 9 402187923
Pyinmana II Branch
No. 181, Yarza Htarni St. Aung Thar Yar Ward,
Pobbathiri Township, Nay Pyi Taw, Myanmar
Phone: 95 9 402187924
Lewe II Branch
No. 241, Office Street, Min Wine Yat, No. 4 Ward,
Lewe Township, Nay Pyi Taw, Myanmar
Phone: 95 9 441580466
Dekkhinathiri Branch
No. Da-2410, Wai Da 10 St. Dekkhinathiri Township,
Nay Pyi Taw, Myanmar
Phone: 95 9 441580468
Lewe III Branch
No. 241, Office Street, Min Wine Yat, No. 4 Ward,
Lewe Township, Nay Pyi Taw, Myanmar
Phone: 95 9 403663020
Takkon I Branch
No. (ma-127), Yin Mar Street, Area (3),
Mya Waddy Ward, Takkon Township, Nay Pyi Taw
Phone: 95 9 441473341
Takkon II Branch
No. 93, Thatoeminsaw Yat, Aung Zaya Ward,
Takkon Township, Nay Pyi Taw
Phone: 95 9 441481276
Ottarathiri Branch
No. Ou-1513, Shwe Nant Thar Ward,
Ottarathiri Township, Nay Pyi Taw
Phone: 95 9 893642032
Nattalin Township, Bago
Phone: 95-9-773579731
Philippines
Wealth Development Bank
Taft Financial Center, Cardinal Rosales Avenue,
Cebu Business Park, Cebu City, Cebu
Phone: 63-32-415-5265
G/F Metro Store Mambaling, Cebu, N. Bacalso Avenue
corner F. Llamas Street, Basak San Nicolas, Cebu City
Phone: 63-414-4233
TAGBILARAN BANKING CENTER
Ground Floor, No. 15 JS Torralba St., Poblacion 2,
Tagbilaran City, Bohol
Phone: 63-411-4860
ALABANG BRANCH
Unit 103, South Center Tower Condominium 2206 Market
Street, Madrigal Business Par Alabang, Muntinlupa City
Phone: 63-2-801-5335
ILOILO BANKING CENTER
Ground Floor, ACCE Bldg., Mabini Ledesma St.,
Liberation, Iloilo City
Phone: 63-338-4419
ANGELES MARQUEE MALL BRANCH
Ground Floor , Marquee Mall, Don Bonifacio St.,
Pulung Maragul Angeles City, Pampanga
Phone: 63-45-624-0072
LEGAZPI PACIFIC MALL BRANCH
G/F Expansion II, Pacific Mall Legazpi, Landco Business
Park, F. Imperial Street Cor. Circumferential Road,
Legazpi City 4500
Phone: 63-52-480-0038
LUCENA PACIFIC MALL BRANCH
Ground Floor L 1-26, Pacific Mall, M.L. Tagarao St.
Landco Business Park, Brgy. III , Lucena City, Quezon
Phone: 63-42-795-3771
TAGUIG MARKET MARKET BRANCH
Ground Floor, Play Ground Zone, Metro Market Market
Mall, Mckinley Parkway, Fort Bonifacio Global City,
Taguig City
Phone: 63-02-889-0275
CEBU AYALA BRANCH
Ground Floor, Taft Financial Center, Cardinal Rosales
Avenue, Cebu Business Park, Brgy. Luz, Cebu City
Phone: 63-32-415-4888
CEBU RAMOS BRANCH
Ground Floor, Hilario Chu Bldg., No. 148 F. Ramos St.
Santa Cruz, Cebu City
Phone: 63-32-412-6302
CEBU CARBON BRANCH
Ground Floor, M.C. Briones & Plaridel Sts., Cebu City
Phone: 63-32-416-9077
CEBU MANDAUE BRANCH
Ground Floor, G/F Meritz Building, A.C. Cortes Ave.
Ibabao, Mandaue City, Cebu
Phone: 63-343-8144
CAGAYAN DE ORO BANKING CENTER
Ground Floor, Jammin Lui Bldg., corner A.Velez & Gomez Sts.
Poblacion, Cagayan de Oro City, Misamis Oriental
Phone: 63-88-856-8974
DAVAO BRANCH
Ground Floor, Door 8, 9 & 10 Grand MenSeng Hotel
Pichon St., 1-E Poblacion, Davao City, Davao del Sur
Phone: 63-82-225-3318
TACLOBAN BRANCH
Sukwan Bldg, corner Real and Burgos Streets, Tacloban City
Phone: 63-053-832-3435
CALOOCAN BRANCH
Rizal Avenue Extension, East Grace Park,
Caloocan 1400, Metro Manila
Phone: 63-0917-870-7335
GENSAN BRANCH
Gaisano mall, Jose Catolico Sr. Avenue, General Santos City,
South Cotabato
Phone: 63-083-250-1238
DUMAGUETE BRANCH
1F Jose Building South Road Calindagan, Dumaguete City
Phone: 63-035-523-5532
BACOLOD BRANCH
Lacson-Luzuriaga Streets, Bacolod City, Negros Occidental
Phone: 63-034-447-0227
BUTUAN BRANCH
JC Aquino Ave, corner, Pareja Subdivision, Butuan City,
Mindanao
Phone: 63-0917-870-7390
Woori OverviewBusiness OperationsGlobal NetworkFinancial Review 326
NAGA BRANCH
Ha Nam Branch
Leuk Daek (Kampong Phnom) Branch Office
Ground Floor, Super Metro Camarines Sur,
1st and 2nd floor, Tien Loc Building, Commercial Service
National Road No. 1, Ampil Tuek village, Kampong
Panganiban Drive, Naga City, Casmarines Sur
Zone 4, Thanh Chau ward, Phu Ly City,
Phnum commune, Leuk Daek district, Kandal province
Phone: 63-054-881-2836
BAGUIO BRANCH
Ha Nam Province, Vietnam
Phone: 84-266-730-0020
Phone: 087777279
Prey Veng Branch Office
NRC Building, Abanao Street, Baguio City, Benguet,
Da Nang Branch
National Road No 11. Village 8, Sangkat Kampong Leav,
Cordillera Administrative Region
Phone: 63-074-665-2394
BINONDO BRANCH
Lucky Chinatown Mall, Reina Regente St. Binondo, Manila,
2nd floor, Phi Long Technology Building, 52 Nguyen Van
Prey Veng city, Prey Veng province
Linh Road, Nam Duong Ward, Hai Chau District,
Phone: 010855644
Da Nang City, Vietnam
Phone: 84-236-730-0321
Sithor Kandal Branch Office
Preaek Sandaek Village Preaek Changkran Commune, Sithor
National Capital Region
Bien Hoa Branch
Kandal District Prey Veng Province.
5th Floor, Sonadezi Building, No 1, Road 1, Bien Hoa 1
Phone: 010855220
Vietnam
Wooribank Vietnam
34F, Keangnam Landmark 72, E6 Pham Hung Road,
Tu Liem District. Hanoi, Vietnam
Phone: 84-04-7300-6802
Hanoi Branch
24F, Keangnam Landmark 72, E6 Pham Hung Road,
Tu Liem District. Hanoi, Vietnam
Phone: 84-4-3831-5281
Hochiminh Branch
No. 7,8,9, 2nd Floor, Mplaza Saigon, 39 Le Duan St.,
Ben Nghe Ward, Dist. 1, HCMC, Vietnam
Phone: 84-8-3821-9839
Bac Ninh Branch
1-2 Floor Halla Bld, Yen Phong Industrial Zone,
Yen Trung Commune, Yen Phong District,
Bac Ninh Province, Vietnam
Phone: 84-222-369-9431
Hai Phong Branch
NO. 4, Lot 22A, Le Hong Phong Street (Cat Bi Airport New
Urban Area), Dong Khe Ward, Ngo Quyen District, Hai
Phong City, Vietnam
Phone: 84-255-730-0101
Thai Nguyen Branch
2nd Floor, Gate 1, Samsung Electronics Vietnam Co.,Ltd.
Thai Nguyen, Yen Binh Industiral Zone, Dong Tien ward,
Pho Yen town, Thai Nguyen Province, Vietnam
Phone: 84-208-730-0010
Binh Duong Branch
Industrial Zone, An Binh Ward, Bien Hoa City,
Dong Nai Province, Vietnam
Phone: 84-251-730-0270
Svay Rieng and Svay Chrom Regional Office
Keansang Village, Svay Rieng Commune,
Svay Rieng City, Svay Rieng Province
Sai Gon Branch
Phone: 068855973
Ground floor and 8th Floor, E-Town 1 Building,
no. 364 Cong Hoa St. Ward 13, Tan Binh District,
Ho Chi Minh City, Vietnam
Phone: 84-28-7300-2710
Vinh Phuc Branch
1st and 2nd Floor, Bao Quan Hotel, 396 Me Linh Street,
Lien Bao ward, Vinh Yen City, Vinh Phuc Province,
Vietnam
Phone: 84-211-730-0010
Cambodia
WB Finance
Preah Sdech Branch Office
Krasang Tong village, Angkor Reach commune,
Preah Sdach district, Prey Veng province
Phone: 0889201571
Kampong Trabaek Branch Office
Doun Tong village, Prasat commune,
Kampong Trabaek district, Prey Veng province
Phone: 0886450320
Mesang Branch Office
Vang Villege Chiphouch Commune,
Mesang District, Prey veng Provinece
Phone: 010855188
Buliding 398, Preah Monivong Blvd, Sangkat Boeun Keng
Kang 1, Khan Chamkarmon, Phnom Penh 12302,
Chantrea Branch Office
Kingdom of Cambodia
Phnom Penh Head Office
Lot No. 398, Monivong Blvd., Sangkat Beung Keng Kang 1,
khan Chamkar Mon, Phnom Penh.
Phone: 023969269
Kandal Regional Office
#240, National Road 2, Krapeu Ha Village,
Thnal Cheat Village, Sangkat Chrok Mates,
Bavith City, Svay Rieng province
Phone: 0889204613
Romeashek Branch Office
Tatrav Village, Kampong Trach Commune,
Romeashek District, Svayreing province
Phone: 0884831787
Sangkat Preak Ruessei, Ta Khmao City, Kandal Province
Kampong Ro Branch Office
Phone: 087634444
Sa'ang Branch Office
Svay Anat Village, Nhor Commune,
Kampong Rou District, Svay Rieng Province
Phone: 0889204643
National Road no.21, Preaek Run village,
Preaek Koy commune, S'ang district, Kandal province
Rumduol Branch Office
10th Floor, Becamex Building, No.230, Binh Duong boule-
vard, Thu Dau Mot City, Binh Duong Province, Vietnam
Phone: 087777993
Phone: 84-274-222-2631
Kien Svay Branch Office
National Road no.1, Tuol Tnaot village, Kaki commune,
Kien Svay district, Kandal province
Phone: 087777488
Kandal Stueng Branch Office
#86, National Road no. 2, Preaek Roka village,
Chak Village, Kampong Chak commune Rumduol
District Svay Rieng Province
Phone: 0889204641
Takeo Regional Office
National Road No. 2, Thnorl bek village,
Sangkat Roka Krao, Doun Kaev city, Takeo province
Phone: 015493888
Preaek Roka Commune, Kandal Stueng district,
Bati Branch Office
Kandal province
Phone: 087777132
National Road no. 2, Smau Khnhei village,
Trapeang Sab commune, Bati district, Takeo province
Phone: 0884839823
Phu My Hung Transaction Office
Unit SA-01, Riverpark Residence Complex,
341 Ha Huy Tap Street, Tan Phong Ward, District 7,
Ho Chi Minh City, Vietnam
Phone: 84-28-7303-0510
Dong Nai Branch
Ton Duc Thang road, Nhon Trach 3 Industrial Zone,
Phase1, Hiep Phuoc, ward, Nhon Trach district,
Dong Nai Provincem Vietnam
Phone: 84-251-730-0370
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 327
Tramkok Branch Office
Korng Pisey Branch Office
Phnum Kravanh Branch Office
Prey Rumdeng Village, Angk Ta Saom Commune,
Tuol Ta Sokh Village, Saen Die Commune,
Pich Ban Village, Leach Commune, Phnum Kravanh
Tram Kak District, Takeo province
Samraong Tong District, Kampong Speu Province
District, Pursat Province
Phone: 060855213
Phone: 068855662
Phone: 0884845057
Kirivong Branch Office
Oudong-1 Branch Office
Veal Veaeng Branch Office
Po Khvet Village, Phrah Bat Choan Chum Commune,
Bat Doeung village, Khsem Khsan commune,
Pramaoy village, Pramaoy commune,
Kirivong District, Takeo Province
Phone: 060855886
Oudongk district, Kampong Speu province
Veal Veaeng district, Pursat province
Phone: 060855776
Phone: 0884845556
Koh Andaet Branch Office
Kraing Chek (Oudong II) Branch Office
Kampong Thom Regional Office
Prey Malong Khang Tbong Village, Prey Khla commune,
Ta Ni village, Krang Chek Commune,
House #009 Group 01 National Road no. 6,
Koh Andaet district, Takeo province
Odongk District, Kampong Speu province
Stueng Saen Village, Sangkat Kampong Krabao,
Phone: 0884839711
Phone: 0884839856
Stoung Sen City and Kampong Thom Province
Samraong Branch Office
Thporng Branch Office
Krang Lang Village, Cheung Kuon Commune,
Tranh Veaeng Village, Prambei Mum Commune,
Romlong Branch Office
Samraong District, Takeo province
Thpong District, Kampong Speu Province
Rom Chek Village,Treal Commune, Baray District,
Phone: 067855333
Phone: 0888551219
Prey Kabas Branch Office
Phone: 0884839945
Oral Branch Office
Kompong Thom Province
Phone: 060855388
#408, St 108, Prey Lavea Ket Village,
Phsar Kontourt village, Sangkea Sartorb Commune,
Stoung Branch Office
Prey Lavea Commune,Prey Kabas district, Takeo povince
Oral district, Kampong Speu province.
National Road no. 6, Leap Tong village, Kampong Chen
Phone: 0884839908
Phone: 066574593
Tboung commune, Stoung district, Kampong Thom province
Kampot (Chhouk) Regional Office
Phnum Sruoch Branch Office
National Road no. 3, Damnak Toap Khang Tboung village,
Krang Khcheay village, Tang Sya commune,
Baray Branch Office
Krang Snay commune, Chhuk district, Kampot province
Phnum Sruoch district, Kampong Speu province
Prey Ta Trav Village, Balang Commune, Baray District,
Phone: 0884836778
Phone: 0974855014
Phone: 0884837957
Banteay Meas Branch Office
Tuek Phors Branch Office
Kampong Thom Province
Phone: 0713855039
Samrong village, Samrong Krom commune,
Srae Ta Chey Vallage, Akphivoadth Communce,
Sandan Branch Office
Banteay Meas district, Kampot province
Tuek Phos District, Kampong Chhnang Province
Toekmleang village, Sandan commune, Sandan district,
Phone: 0884844237
Phone: 087777010
Kampong Thom province
Phone: 0884827690
Angkor Chey Branch Office
Kampong Chhnang Regional Office
Pral Village, Tani Commune, Angkor Chey District,
National Road no.5, Tuol Kralanh village, Sangkat
Prasat Sambour Branch Office
Kampot Province
Phone: 060855085
Kampong Trach Branch Office
Kampong Chhnang , Kampong Chhnang city,
Sambo Village ,Sambo commune,
Kampong Chhnang province
Phone: 0974855006
Prasat Sambour district, Kampong Thom province
Phone: 0884836883
Kampong Trach Ti Muoy Village, Kampong Trach Khang
Kampong Leaeng Branch Office
Chamka Loeu Branch Office
Kaeut Commune, Kampong Trach District,
Kampong Boeng village, Kampong Hau commune,
Thnol Bek Lech Village, Svay Tearb Commune,
Kampot Province
Phone: 060855075
Kampong Leng district, Kampong Chhnang province
Chamkar Loeu District, Kampong Cham Province.
Phone: 090855763
Phone: 0888472236
Kampong Som Branch Office
Village no. 03, Sangkat Lak 02, Quarter,
Metapheap Ward, Preah Sihanouk City
Phone: 068855997
Sre Ambel Branch Office
Trapeang village, Sre Ambel commune,
Sre Ambel district, Koh Kong province
Phone: 0884837124
Basedth Branch Office
Kampong Tralach Branch Office
Battambang Regional Office
Soben Village, Peani Commune, Kampong Tralach
#99, No. 03, Mphey Osakphea village, Sangkat Svay Pao,
District, Kampong Chhnang Province
Battambang city, Battambang province
Phone: 090855820
Phone: 066855022
Boribour Branch Office
Banan Branch Office
Cheung Khnar Village, Ponley Communce,
Banan Village Kantueu Pir Commune,
Boribour District, Kampong Chhnang Province
Banan District, Battambang Province
Phone: 0886007498
Pursat Branch Office
Phone: 010855775
Ratanak Mondul Branch Office
Slab Leaeng village, Svay Rompea commune,
#475, National Road 5, Krang Pophleak Village,
#34, Sdau village, Sdau Commune,
Basedth district, Kampong Speu province
Svay At Commune, Pursat District, Pursat province
Rotonak Mondol distrcit, Battambang province
Phone: 0884874229
Phone: 0886007540
Phone: 010855977
Kampong Speu Regional Office
Krakor Branch Office
Moung Ruessei Branch Office
# 85, national road #04, Borei Kammeakkar Village, Rokar
National Road 5, Phsar village,Anlong Tnaot commune, Kra-
Pou Muoy Village,Kear Commune,
Thum Commune/Sangkat, Chbar Mon
kor district, Pursat province
Moung Ruessei District, Battambang Province
Municipality/District/Khan, Kampong Speu Province
Phone: 0884838011
Phone: 069855585
Phone: 066746666
Woori OverviewBusiness OperationsGlobal NetworkFinancial Review 328
Bakan Branch Office
Chulkiri Branch Office
Bavel Branch Office
Khnach Romeas Village, Beung Khnar Commune,
Prey Kri Tbong Village, Prey Kri commune,
#15, st. Aksor Te, Bavel 1village, Bavel commune,
Bakan District, Pursat Province
Phone: 0886007538
Chulkiri district, Kampong Chhnang province
Bavel district, Battambang province
Phone: 0884839707
Phone: 090281942
Pailin Branch Office
Tbong Khmom Branch Office
Phnom Proek Branch Office
O'Tapuk Le village, Pailin commune, Pailin city,
National Road no. 7, Cheung Lang village,
Phnum Toch village, Pech Chenda commune,
Pailin province
Phone: 0884873724
Sangkat Suong, Suong city, Kampong Cham province
Phnum Proek district, Battambang province
Phone: 0886007526
Phone: 090855342
Samlout Branch Office
Ou Tontuem village, Ta sanh commune,
Samlout district, Battambang province
Phone: 0884873767
Kamrieng Branch Office
Dong Village, Boeng Reang Commune,
Kamrieng District, Battambang Province
Phone: 090309180
Preah Vihear Regional Office
Koh Sotin Branch Office
Siem Reap Regional Office
Phsar Thmey Village, Pearm Pror Thnours Commune, Koh
#76, National Road no. 6, Chong Kao Sou village,
Sotin District, Kampong Cham Province
Sangkat Slor Kram, Siem Reap city, Siem Reap province
Phone: 0883031098
Phone: 0884845477
Ponhea Kraek Branch Office
Puok Branch Office
National Road no. 7, Peao Srok village,
Puok Chas Village, Puok Commune, Puok District,
Kaong Kang commune, Ponhea Kraek district,
Thbong Khmom province
Phone: 0979111030
Siem Reap Province
Phone: 0884836879
Srey Snom Branch Office
Lor Et village, Sangkat Kampong Branak,
Kratie Regional Office
Chroy Neang Nguon village, Chroy Neang Nguon commune,
Preah Vihea city, Preah Vihea province
Oreussey Village, Kratie Ward, Kratie City,
Srey Snam district, Siem Reap province
Phone: 0884488844
Kuleaen Branch Office
Kratie Province
Phone: 0888848041
Kuleaen Tboung Village, Kuleaen Tboung commune,
Chhloung Branch Office
Phone: 060270442
Angkor Chum Branch Office
Kbal Cham Village,Char Chhuk commune,
Kuleaen district, Preah Vihear province
Chrouy Thma Kraom village, Chhloung commune,
Angkor Chum District, Siem Reap Province.
Phone: 0886007523
Chhloung district, Kratie province
Phone: 087555476
Sangkum Thmey Satellite Office
Tbeang Village, Chamraeun commune,
Snuol Branch Office
Sangkom Thmei district, Preah Vihear province
Kbal Snuol Village, Snuol Commune,
Phone: 0888816546
Phone: 060855749
Rovieng Branch Office
Snuol District, Kratie Province
Phone: 0884818019
Samraong Chong Kal Branch Office
at Doun Kaen Village, Samraong Commune,
Samraong District, Oddar Meanchey province
Phone: 087666741
Chi Kraeng Branch Office
Tang Trak Village, Robieb commune, Rovieng District,
Keo Sema Branch Office
#079, Group 01, Kampong Kdey1 Village, Kampong Kdey
Preah Vihear Province
Phone: 0884845242
Trapaing Prasat Branch Office
Ou Arm Village, Sre Khtom Commune,
Commune, Chikrek District, Siem Reap Province.
Keo Sema District, Mondol Kiri Province
Phone: 087555474
Phone: 0884818026
Preah Net Preah Branch Office
Trapeang Prasat Village, Trapeang Prasat commune,
Dambae Branch Office
National Road 6, Phnum Chonhcheang village,
Trapeang Prasat District, Oddar Meanchey Province
National Road no. 73,Thnal village, Dambae commune,
Chob Veari commune, Preah Netr Preah district,
Phone: 0884845248
Dambae district, Kampong Cham province
Banteay Mean Chey province
Choam Khsant Branch Office
Phone: 0884843373
Phone: 060855553
National Road 69B, Choam Khsant village,
Memot Branch Office
Phnom Penh (Tuol Kork) Regional Office
Choam Khsant commune, Choam Khsant district,
Masin Tuek Village, Memot Cummune,
#152B2, St 516, 13 Village, Sangkat Boeung Kork 1,
Preah Vihear province
Phone: 0884845291
Memot District, Kampong Cham Province
Khan Toulkork, Phnom Penh.
Phone: 0884381224
Phone: 0719833384
Kampong Cham Regional Office
National Road 7, village Boeng Snay,
Banteay Mean Chey Regional Office
Stueng Mean Chey Branch Office
National Road no.6, Kampong Svay village,
No. 19 and 21 EoE1, Street Veng Sreng, Group 1,
Kampong Cham city, Kampong Cham province
Sangkat Kampong Svay, Serei Saophoan city,
Ruessei Commune, Sangkat Stueng Mean Chey,
Phone: 0884840089
Prey Chhor Branch Office
Banteay Mean Chey province
Phone: 0884838900
Khan Mean Chey, Phnom Penh
Phone: 087888277
Doun Die village, Chrey Vean commune,
Ou Chrov Branch Office
Punhea Lueu Branch Office
Prey Chhor district, Kampong Cham province
#15A, National Road no.5, Palilai village, Sangkat Paoy
#87, National Road No. 5, Tep Pranom village, Vihea
Phone: 0884842218
Paet, Paoy Paet city, Banteay Mean Chey province
Luong commune, Ponhea Lueu district, Kandal province
Phone: 0884845706
Phone: 0884843228
Stoeung Trang Branch Office
Tnaot Ta Say Village, Preak Kak Commune,
Thma Puok Branch Office
Mukh Kampoul Branch Office
Stueng Trang District, Kampong Cham Province.
Kasen village, Thma Puok commune, Thma Puok district,
La Edth Village, Preaek Dambang Commune,
Phone: 0884842804
Bantey Mean Chey province
Phone: 0884839749
Mukh Kampul District, Kandal Province
Phone: 0884842169
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 329
Khsach Kandal (Preaek Tameak) Branch Office
Khemarak Phoumin Branch
Ang Snoul Branch
Knong village, Preaek Tameak commune,
Street Khemara Phoumin, Group 7, Phum Ti Pir Village,
House No 183, National Road 4, Trapeang Krasang Village,
Khsach Kandal district, Kandal province
Sangkat Smach Mean Chey, Khemara Phoumin
Baek Chan Commune, Angk Snuol District, Kandal Province
Phone: 0884842027
Svay Pak Branch Office
Municipality, Koh Kong Province
Phone: 855-88-8558025
Phone: 855-023-999-355
Phsar Depo Branch
National Road No. 5, Lu Village Svay Pak,
Cheungprey Branch
House No 138D, St 215, Sangkat Veal Vong,
Khan Russey Keo, Phnom Penh
Phone: 0884845604
Chaom Chau Branch Office
National Road No.6 Skon Village, Soutlib Commune,
Khan Prampir Meakkakra, Phnom Penh
Cheung Prey District, Kampong Cham Province
Phone: 855-23-900-455
Phone: 855-97-6447373
AreyKshat Branch
Prey Svay Village, Sangkat Chaom Chau,
Krolkor Branch
House No 76, Road No.380, Preaek Lvea Village,
Khan Pur SenChey, Phnom Penh
Phone: 0884840208
Chruoy Changvar Branch Office
St 1 Thlok Village, Kraol kou Commune,
Preaek Ta Kov Commune , Khsach Kandal District,
Svay Chrum District, Svay Rieng Province
Phone: 855-87-666945
Kandal Province
Phone: 855-24 900-488
lot No. A-01, Street 6A, Phum 3, Sangkat Chrouy Chang Var,
Peraing Branch
S'ang Branch
Khan Chroy Chang Var, Phom Penh City
National Road No.8, Snay Pol Village, Roka Commune, Pea
House No 154, National Road 21, Preaek Khsev Village, Rokar
Phone: 0884841986
Srey Sonthor Branch Office
Santey village, Preaek Po commune,
Srey Sonthor district, Kampong Cham
Phone: 0884845245
Ratanakiri Regional Office
Reang District, PreyVeng Provice
Phone: 855-81-709967
Khpos Commune, S'ang District, Kandal Province
Phone: 855-24 901-455
Prey Nop Branch
Steung Meanchey Branch
Road No.4 Veal Meas Village, Veal Renh Commune,
House No 19A, Samdech Preah Monireth Blvd,
Prey Nop District, Preah Sihanouk Province
Phum Domnak Thum, Sangkat Stueng Meanchey 2,
Phone: 855-68-855997
Khan Meanchey, Phnom Penh
Phone: 855 23 901 345
Chey Chumnas Village, sangkat Labanseak,
Baphnom Branch
City Banlung, Ratanakiri Province
#022 St317 Chheu Kach Village, Chheu Kach Commune, Ba
Chom Chao Branch
Phone: 0884830845
phnom Distirict, Prey Veng Province
House No 4A, Veng Sreng Blvd, Phum Chrey Kaong,
Phone: 855-93-855773
Sangkat Chaom Chau 2, Khan Pur Senchey, Phnom Penh
Stoeung Treng Branch Office
Spean Thmor Village, Stoeung Treng Commune, Stoeung
Koh Thom Branch
Phone: 855 23 901 355
Treng District Stoeung Treng Province
Kampong Svay Kraom Village, Preaek Thmei Commune, Koh
Char Ampov Branch
Phone: 0713261010
Koh Nhek Branch Office
Thom District, Kandal Province
Phone: 855-87-777985
House No 610B, National road No 1, Deum Slaeng Village,
Sangkat Chbar Ampov Ti Pir, Khan Chbar Ampov, Phnom Penh
Phone: 855 023 999 026
Reangsei village, Srae Sangkum commune,
Woori Finance Cambodia Plc.
Kaoh Nheaek district, Mondul Kiri province
Building No. 119B, Street271, Sangkat Phsar Doeum
Toul Kork Branch
Phone: 0713855124
Borkeo Branch Office
Phum Muoy village, La Minh Commune,
Bar Kaev District, Ratanakiri Province,
Phone: 0713260505
Saen Monourom Branch Office
Thkov Khan Chamkarmon, Phnom Penh.
House No 1C, St 355, Phum 1, Sangkat Boeng Kak Ti Muoy,
Phone: 855-23-999-661
Russey Keo Branch
Khan Tuol Kouk, Phnom Penh
Phone: 855 023 999 025
House No 1A, National Road 5, Phum Kraol Kou, Sangkat
Chamkar Doung Branch
Kilomet Lekh Prammuoy, Khan Russey Keo, Phnom Penh.
House No 2039, St 217, Ta lei Village, Sangkat Dangkao,
Phone: 855-23-999-664
Khan Dangkao, Phnom Penh
Phone: 855 023 999 027
Chambak Village, Spean Mean Chey Commune,
Pursenchey Branch
Saen Monourom District, Mondul Kiri Province
House No 6A, Russian Federation Blvd, Phum Ta Ngoun,
Kampongspeu Branch
Sangkat Kakab, Khan Pur Senchey, Phnom Penh.
House No 751, National Highway No 4, Chambak Village,
Phone: 855-23-999-803
Voa Sar Commune, Samraong Tong District,
Kampong Bay Khang Cheung Village, Kampong Bay Sang-
Kean svay Branch
Kampong Speu Province
Phone: 855 025 900 555
House No. 330, National Road 1, Toul Tnaot village,
Korkir Communce, Kien Svay district, Kandal province
Pshar Dey Huy Branch
Phone: 855-23-720-632
House No. 11, Phnom Penh-Hanoi Friendship Blv (1019),
Phone: 0713855100
Kampot Branch
kat, Kampot City, Kampot Province
Phone: 855-68-435555
Kamchaymear Branch
National Road No. 8, Tean Phleung Village,
Takhmao Branch
Smaong Khang Cheung Commune,
Building No. 31, National Road 2, Ta Khmau village,
Kamchay Mear District, Prey Veng Province
Sangkat Ta Khmau, Krong Ta Khmau, Kandal Province
Roung Chakr Village , Sangkat Kouk Kleang,
Khan Saensokh, Phnom Penh
Phone: 855 023 900 466
Phone: 855-10-855747
Phone: 855-24-998-333
Kandal Stueng Branch
Thmakoul Branch
National Road No. 5, Paoy Yong Village,
Ta Pung Commune, Thma Koul District,
Battambang Province
Phone: 855-69-855755
PrekPhnov Branch
National Road 5, Phum Kandal, Sangkat Preaek Phnov,
Kandal Stueng District, Kandal Province
Phone: 855 024 900 066
Land No. 5, St. 38, Svay Ming Village, Barku Commune,
Khan Preae Phnov, Phnom Penh
Phone: 855-23-900-345
Woori OverviewBusiness OperationsGlobal NetworkFinancial Review 330
Odongk Branch
National Road No. 5, Mlu Meun Village, Phsar Daek Com-
mune, Ponhea Lueu District, Kandal Province
Overseas Branch
Patheingyi Branch
Phone: 855 024 900 077
Mukh Kampul Branch
House No 271, National Road 6A, Kraom Village,
Preaek Anhchanh Commune, Mukh Kampul District,
Kandal Province.
Phone: 855 024 900 099
Europe
Woori Bank Europe
MesseTurm, 29th floor, Friedrich-Ebert-Anlage 49, 60308,
Frankfurt am Main, Germany
Phone: +49(0)69 299 254 0
Overseas Office
Malaysia
Woori Bank Kuala Lumpur Representative Office
Unit 4129/4130, 41/F, Vista Tower,
The Intermark 182 Jalan Tun Razak,
Kuala Lumpur 50400, Malaysia
Phone: 60-3-2163-8288
Myanmar
Woori Bank Yangon, Myanmar Office
No.115(A) First Floor), Pyay Road, 10 Miles,
Insein Township, Yangon, Myanmar
Phone: 95-01-646951
Poland
Woori Bank Poland Represetative Office
Uniwersytecka 13, 40-007, Katowice, Poland
Phone: 48-323-076-417
No. 19, 58st, Between 19th and 20th street, A Nate Taw
Quarter, Aungmyaytharzan Township, Mandalay
Phone: +95-9405243993
Kyaukse Branch
No. 83, Tal Soe Gate, Aye Mya Kyi Lin(East)Ward,
Railway Parallel Street, Kyaukse Township, Mandalay
Phone: +95-9400208422
Tharyarwaddy Branch
No. 204 , Yangon-Pyi Street(Lan Ma Taw) Middle Ward,
Thone Sae, Tharyarwaddy Township, Bago
Phone: +95-9400230933
Madaya Branch
No. 2/1203, Yinn Mar Street , No. 2 Ward,
Madaya Township, Mandalay
Phone: +95-9400208299
Pyin Oo Lwin Branch
No. 2, 28th Street, Thumingalar, near Bazarr and Thumin-
galar Football Studium, In Front of Thumingalar Chapel,
Pyin Oo Lwin Township, Mandalay
Phone: +95-9443365122
Wundwin Branch
No. 3, Myoma Ward, Myoma Street,
Wundwin Township, Mandalay
Phone: +95-9255450099
Kume Branch
TharyarAye Ward, Yangon-Mandalay Highway Road,
Near by B.E.H.S, Kume Township, Mandalay
Phone: +95-9251902656
Pakokku Branch
Corner of 4th Street and Myaing Street, Ward 11, Pakokku
Township, Magway
Phone: +95-9251902655
Letpadan Branch
No. 36, Bo Phone Myint Street, Ma Au Kone Ward,
Letpadan Township, Bago
Phone: +95-9256923758
Yamethin Branch
No. 179, Khwar Nyo Street, Thilawa-1 Ward,
Woori Card
(Tutu Finance_WCI Myanmar)
Yamethin Township, Mandalay
Phone: +95-9898291199
Head Office
Shwebo Branch
Room 8, Block 6, Mingalar Mandalay, Between Thazin Street
and Ngu Shwe Wah Street, 73rd Street,
Chanmyatharsi Township, Mandalay
Phone: +95-22000219
Overseas Office
Yangon Office
Near by No.10 Kone Baung Market, Tap Myo Taung 3 Lane,
Kyae Lat Office Street, Shwe Bo Township, Sagging
Phone: +95-9899948011
Kanbalu Branch
No. 4 Ward, Near Myoma Market,
Southern Part of Main Road, Kanbalu Township, Sagaing
Phone: +95-9266362426
Yesagyo Branch
No. 386/R 8, Sa Ward, Thudamar Street,
No. 45, Pinlone Road, No.3 Ward,
North Okkalapa Township, Yangon
Phone: +95-9420146551
Yesagyo Township, Magway
Phone: +95-9446944080
Salin Branch
No. 69/70, Maharthamainhtaw Streets,
Pahtoephyu Quarter, Salin Township, Magway
Phone: +95-9409701392
Pwintbyu Branch
No.1, Kantkaw Street, Ahlaepai Quarter,
Pwintbyu Township, Magway
Phone: +95-9406030200
Thazi Branch
No. 111, Ward-4, Htain Kan Quarter,
Tharzi Township, Mandalay
Phone: +95-9407217185
Pyawbwe Branch
No. 50, Ward-159, Yan Aung Streets, Shwe Pyi Yan Lone
Quarter, Pyawbwe Township, Mandalay
Phone: +95-9407217186
Taungtha Branch
No. 4/94, No.4 Quarter, 9th Street,
Taungtha Township, Mandalay
Phone: +95-9406030201
Kyaukpadaung Branch
Poppa-Myingyan Road, Nearby No.1 Bridge,
Northern Pyi Taw Thar Quarter,
Kyaukpadaung Township, Mandalay
Phone: +95-9964434368
Chanmyathazi Branch
No. Sa-6, Owner No. 53-Ka, Myothit 2 Ward, Between
69th and 70th street, Between KhaingShweWah street &
ZalattWah Street, Chanmyathazi Township, Mandalay
Phone: +95-9977579424
Khin-U Branch
No. 353/354, Beside of Yae U-Khin U Road,
Mya Kan Thar Quarter, Khin-U Township, Sagaing
Phone: +95-9894747433
Sagaing Branch
Owner No. 2, No.4 Ward, Ad Choke Su Street,
Ad Choke Su Quarter, Moe Zar Township, Sagaing
Phone: +95-9966767133
Myinmu Branch
No. 3/301, Kann Nar Street, Min Ye Kyaw Swar Ward,
Myinmu Township, Sagaing
Phone: +95-9984998602
Woori Asset Management
Vietnam
Overseas Office
Woori Asset Management Hochiminh Representative Office
Suite 615-4, MeLinh Point, 2 Ngo Duc ke st., dist.1, HCMC.
Phone: (84-28)-3520-2811
WOORI FINANCIAL GROUP ANNUAL REPORT 2019 Contact Information
Directed by Ko, Hyunsoo
Manager & IR Officer
Investor Relations Department, Woori Financial Group
Tel: 82-2-2125-2055
hyunsoo.ko@woorifg.com
Designed by Reddot Branding
Tel: 82-2-584-0418
51, Sogong-ro(203, Hoehyeon-dong 1-ga),
Jung-gu, Seoul, 04632, Korea
Tel. 82+2-2125-2000 www.woorifg.com