Woori Financial Group Inc.
Annual Report 2022

Plain-text annual report

CUSTOMERS EXPERTISE TRUST INNOVATION INNOVATE TODAY, CREATE TOMORROW WOORI FINANCIAL GROUP ANNUAL REPORT 2022 CONTENTS 01 WOORI OVERVIEW 02 ESG REPORT 03 STRATEGY REPORT 04 BUSINESS REPORT 01 WOORI OVERVIEW 04 BUSINESS REPORT MESSAGE FROM THE CEO BOARD OF DIRECTORS FINANCIAL HIGHLIGHTS KEY FIGURES 02 ESG REPORT ESG MANAGEMENT SOCIAL RESPONSIBILITY GOVERNANCE 03 STRATEGY REPORT GROUP VISION & STRATEGY GROUP-WIDE SYNERGIES DIGITAL INNOVATION GLOBAL BUSINESS RISK MANAGEMENT 004 005 006 007 009 012 015 018 020 022 024 027 GROUP BUSINESS PORTFOLIO WOORI BANK WOORI CARD WOORI FINANCIAL CAPITAL WOORI INVESTMENT BANK WOORI ASSET TRUST WOORI SAVINGS BANK WOORI FINANCIAL F&I WOORI ASSET MANAGEMENT WOORI VENTURE PARTNERS WOORI GLOBAL ASSET MANAGEMENT WOORI PRIVATE EQUITY ASSET MANAGEMENT WOORI CREDIT INFORMATION WOORI FUND SERVICES WOORI FIS WOORI FINANCE RESEARCH INSTITUTE APPENDIX ORGANIZATIONAL CHART GLOBAL NETWORK 2022 AUDITED FINANCIAL STATEMENTS 002 031 032 041 043 044 045 046 047 048 049 050 051 052 053 054 055 056 057 064 003 01 WOORI OVERVIEW MESSAGE FROM THE CEO BOARD OF DIRECTORS FINANCIAL HIGHLIGHTS KEY FIGURES 004 005 006 007 STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTMessage from the CEO 004 Dear Valued Customers and Shareholders, Secondly, WFG will enhance its risk management capacity I am Jong-Yong Yim, the recently appointed Chairman of Woori Financial Group (WFG), and I am greatly honored to extend my sincerest greetings to our esteemed customers and shareholders. Throughout 2022, the global economy experienced volatile market conditions, largely influenced by the repercussions from the pandemic and steep interest rate hikes. While the rate hikes did improve the net interest margin of Korean banks, Korean Financial Institutions encountered much uncertainty throughout the year. These uncertainties were compounded by notable concerns over financial instabilities, which were particularly evident within the non-banking financial sector. and establish robust internal controls. WFG will prioritize sound management and will strive to enhance capital adequacy, aiming for a higher level of stability to effectively address potential market downturns. Thirdly, WFG will advance its digital competitiveness and actively pursue growth opportunities in the non-financial sector. In doing so, WFG will embrace the convergence of the financial industry with other sectors as a favorable opportunity, rather than a challenge, with the goal of enhancing our long-term competitiveness. Lastly, WFG will intensify its efforts to serve and create more value for society and customers. We will strive to provide tangible support to marginalized companies and financially distressed Despite these challenges, WFG delivered outstanding results in 2022 with a net income of 3.14 trillion won. This milestone was groups. made possible through the preservation of high asset quality Respected customers and valued shareholders, backed by robust risk management strategies. However, the As the newly appointed Chairman, I am committed to establishing foundation of our success lies in our esteemed customers and a new corporate culture and driving bold organizational shareholders. Their unwavering support has been instrumental innovations to showcase the transformative journey of Woori in our achievements, and on behalf of WFG, I wish to express my Financial Group. As we set out on this journey, we aspire to sincere gratitude. consistently earn your trust and confidence. This year, we anticipate heightened global macro headwinds, In addition, Woori Financial Group will make every efforts to notable shifts in the regulatory environment, and a greater enhance shareholder value. We genuinely seek your ongoing emphasis on social responsibilities from financial institutions. support and encouragement. With these dynamics in mind, I will steer with prudence in my capacity as the newly appointed Chairman, aiming to secure stable financial performance, foster potential growth, and drive Yours truly, bold organizational innovations. Firstly, WFG will continue to enhance the competitiveness of the non-banking sector. Through portfolio diversification, exemplified by the recent acquisition of a Venture Capital firm, WFG will diligently lay ground for a well-balanced profit structure. Jong-Yong Yim Chairman & CEO Woori Financial Group STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTBoard of Directors Jong-Yong Yim Woori Financial Group Chairman & CEO Chan-Hyoung Chung Independent Director In-Sub Yoon Independent Director 005 •B.A in Economics, Yonsei University •M.A. in Economics, University of Oregon •Senior Secretary to the President for Economic Affairs •Deputy Minister, Prime Minister’s Office •Chairman & CEO, NongHyup Financial Group •Chairman, Financial Services Commission Su-Young Yun Independent Director •Economics, Seoul National University •Master of Economics, Seoul National University •Head of Management Planning Office, and General Senior Vicepresident of Sales Support Division and Asset Management Division, Kiwoom Securities Co., Ltd. •CEO, Kiwoom Asset Management •Senior Executive Vice President, Kiwoom Securities Co., Ltd. Soo-Young Song Independent Director •French Language and Literature, Business Administra- tion, and Law, Seoul National University •Executive MBA, Seoul National University Business School •Advisory Lawyer, Creative Economy Innovation Center, Ministry of Justice •Member of Steering Committee for ESG Support Projects for Partners, Korea Commission for Corporate Partnership •Business Administration, Korea University •Master of Finance, Korea University Business School •Senior Vice President, Management Planning Office, Korea Investment & Securities •CEO and President, Korea Investment Management Co., Ltd. •CEO, POSCO Venture Capital Co., Ltd. Yo-Hwan Shin Independent Director •Business Administration, Korea University •Master of Science in Financial Engineering, Illinois State University •Head of Retail Sales Division, Shinyoung Securities •General Management Executive, Shinyoung Securities •CEO, Shinyoung Securities Won-Duk Lee Non-Standing Director Chairman and CEO, Woori Bank •Agricultural Economics, Seoul National University •Master of Economics, Seoul National University •Head of Management Planning Group, Woori Bank (Vice President) •Vice Chairman, Management Planning Group, Woori Bank •Senior Executive Vice President, Woori Financial Group •Applied Statistics, Yonsei University •Master of Accounting, Yonsei University Business School •CEO and President, Korea ING Life Insurance Co., Ltd. •CEO and President, Hana HSBC Life Insurance Co., Ltd. •General Representative Director, Korea Ratings •Chairman of the Board of Fubon Hyundai Life Insurance Sung-Bae Ji Independent Director •Business Administration, Seoul National University •Master of Business Administration, Seoul National Uni- versity Business School •Samil Accounting Firm •CEO, IMM Co., Ltd. •14th Chairman of Korea Venture Capital Association •Current CEO, IMM Investment STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTFinancial Highlights 006 Growth Assets Loan Portfolio (Unit: KRW in trillions) ■ Loans in Won ■ Total Assets (Including AUM) ■ Large Corp. ■ SME ■ Retail ■ Public & Others 2022 2021 2020 Profitability NIM ■ Bank+Card ■ Bank Asset Quality NPL Ratio 282.7 273.3 249.3 1.57% 1.62% 1.33% 1.37% 640.3 594.4 525.9 1.84% 1.59% 2022 2021 2020 36.9 36.4 35.7 ROE & ROA ■ ROE ■ ROA 121.0 133.9 110.4 138.8 95.8 130.4 2.5 3.9 2.5 296 288 265 10.58% 11.54% 0.66% 0.70% 5.87% 0.40% 2020 2021 2022 2020 2021 2022 0.42% 0.30% 0.31% Capital Adequacy Capital Adequacy Ratio 13.8% 11.8% 10.0% ■ BIS Ratio ■ Tier1 Ratio ■ CET1 Ratio 15.1% 13.3% 11.4% 15.3% 13.6% 11.6% 1) Net income, ROE : Based on Controlling interests 2) Cost-to-Income Ratio : Excluding ERP expense 3) ROA : Including non-controlling interests 2020 2021 2022 2020 2021 2022 202020212022YoYGrowth (KRW in trillions)Total Assets including AUM 525.9 594.4 640.3 7.7%Loans in Won 249.3 273.3 282.7 3.4%Total Equity 26.7 28.9 31.6 9.6%Profitability (KRW in billions)Net Interest Income 5,999 6,986 8,697 24.5%Non-Interest Income 822 1,358 1,149 -15.4%Net Income1) 1,307 2,588 3,142 21.4%NIM(Bank)(%) 1.33 1.37 1.59 0.22%pNIM(Bank+Card)(%) 1.57 1.62 1.84 0.22%pCost-to-Income Ratio(%)2) 55.0 47.5 44.4 -3.1%pROE(%)1) 5.87 10.58 11.54 0.96%pROA(%)3) 0.40 0.66 0.70 0.04%pAsset QualityNPL Ratio(%) 0.42 0.30 0.31 0.01%pCredit Cost Ratio(%) 0.28 0.17 0.26 0.09%pCoverage Ratio(%) 153.8 192.2 217.6 25.4%pCapital AdequacyCommon Equity Capital Ratio(%) 10.0 11.4 11.6 0.2%pTier1 Ratio(%) 11.8 13.3 13.6 0.3%pBIS Total Capital Ratio(%) 13.8 15.1 15.3 0.2%pSTRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTKey Figures Key Statistics Customers (Woori Bank) SME/SOHOs (Woori Bank) 25.1 million 1.93 million 11 Out of 38 Large Enterprises (Total number of large enterprises where Woori Bank is the major creditor bank) Domestic Branches Global Network Employees (Woori Bank) 713 branches 24 countries 569 network 27 thousand employees Assets Loans Deposits KRW 640.3 trillion (Including AUM) KRW 343.8 trillion KRW 342.1 trillion 007 ESG Ratings Received "AA"rating from MSCI Received "A"rating from KCGS Credit Ratings International Ratings Woori Bank A1 A+ A Republic of Korea Aa2 AA AA- Moody's S&P Fitch Domestic Ratings Woori Financial Group AAA AAA AAA NICE Investors Service Korea Ratings Corporation Korea Investors Service (as of Dec. 2022) ConglomeratesSTRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT008 02 ESG REPORT ESG MANAGEMENT SOCIAL RESPONSIBILITY GOVERNANCE 009 012 015 STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTESG Management ESG is not just a trend; it is the very core of modern business values. Beyond financial outcomes, non-financial accomplishments in en- vironmental preservation, social responsibility, and transparency in governance are now integral measures of corporate value. This new paradigm has resonated globally, with ESG considerations becom- ing important investment decision factors for many international institutional investors. At Woori Financial Group, we have not simply adapted to this trend, but have proactively embraced it. We took the initiative to establish our ESG management system in 2021 and ESG Highlights Environment subsequently expanded and improved our ESG management prac- Responding to climate change tices in 2022. Now, we are not just taking steps but making strides towards solid- ifying our ESG management system. Our objective is to secure our position as a global top-tier ESG company by the end of 2023. We will achieve Carbon Net-Zero within the Group and across our asset portfolio by 2050. 2022 ESG Evaluations 009 Restoring nature and Conservation of biodiversity •The first domestic company to join TNFD (Jan. 22) •The first Asian company to join PBAF (Aug. 22) •Promoting REDD+, a carbon reduction project, through forest conservation in developing countries Social Governance Advancing ESG Governance •Appointment of female indepen- dent director(ESG expert) & ESG Committee Chair (Mar.22) •Establish Group ESG strategies and policies, ect.(Committee consists of all 9 directors) •Communication and cooperation on ESG management activities between group companies Expanding social contribution Group’s 5 core areas Woori Multicultural Scholarship Foundation, Woori Financial Group Future Foundation contributed KRW 20 billion newly established in 2022 Linked to the UN SDGs •Protecting Nature •Supporting Vulnerable Groups •Providing Support for arts and culture •Fostering Future Talent •Creating jobs 202020212022KCGSB+AAMSCIBBBAAAADJSI-Inclusion to theAsia-Pacific IndexInclusion to theAsia-Pacific Index STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT010 Engagement in Global Initiatives Jan. 2021 TCFD (Taskforce on Climate-related Financial Disclosures) Feb. 2021 CDP (Carbon Disclosure Project) Mar. 2006 UN Global Compact Nov. 2019 UNEP FI (UN Environment Programme Finance Initiative) Jan. 2020 UNEP FI PRB (UNEP FI Principles for Responsible Banking) 2022 ACHIEVEMENTS Underpinning ESG Governance The ESG Management Committee of Woori Financial Group (a committee within the Board) has been receiving reports on and reviewing and managing the overall progress and plans related to the group's ESG management, including climate risk, biodiversity conservation, and mutual growth management with stakeholders. In March 2022, the Group appointed an ESG expert as its first female independent direc- tor since the foundation of the holding company. She also chairs the ESG Management Committee. This appointment is part of our ongoing efforts to increase gender diver- sity and specialized knowledge within the board of directors. It also contributes to the strengthening of our governance structure, which is geared towards sustainable growth through adherence to ESG management practices. Promoting Social Responsibility Management Taking ESG to the Global Front In August 2022, Woori Financial Group co-hosted the Circular Economy Conference 2022 with the World Wide Fund for Nature (WWF) in Seoul, marking the first occasion for a Korean financial company to host such an event. The conference addressed the tran- sition to a circular economy and win-win management with stakeholders. In October, the Group received invitations from several international ESG organizations, including the UN- CCD (UN Convention to Combat Desertification), UNEP FI (UN Environment Programme Finance Initiative), IUCN (International Union for Conservation of Nature), and WWF, to engage in discussions on international cooperation in response to the climate crisis and natural recovery. Shortly thereafter, the Group joined the Net Zero Banking Alliance (NZBA), an international interbank leadership alliance composed of 117 banks from 41 countries committed to achieving net-zero emissions by 2050. Later, in November, the Group held an international conference on the theme of “Sustain- able Finance for a Better World: Natural Recovery and a Circular Economy to Open a New Era” to respond to complex crises going on around the world and to spread ESG manage- Woori Financial Group established the Woori Financial Group Future Foundation in July ment. The conference featured top ESG scholars and global financial experts from Korea 2022 with the goal of helping vulnerable and underprivileged people stand on their own and many other countries, including Henry Fernandez, Chairman of MSCI, economist and supporting the growth of future generations. As a public interest foundation estab- Anne O. Krueger, Elizabeth Maruma Mrema, Executive Secretary of the Convention on lished jointly by all 15 Group affiliates, it will continue to engage in a wide variety of public Biological Diversity, and Andrea Meza Murillo, Deputy Executive Secretary of the UNCCD. benefit projects to fulfill the social responsibilities and roles of the Group. The conference also featured discussions on “Sustainable Growth Solutions Beyond the Challenges Facing the World Economy” between economist Anne O. Krueger, former Deputy Managing Director of the IMF and the World Bank, and Sung Tae-yoon, a profes- sor at Yonsei University, as well as in-depth discussions on efforts to achieve the mission of protecting natural ecosystems and achieving a circular economy. Aug. 2021 Aug. 2021 Equator Principles(EP) PCAF Sep. 2021 SBTi Sep. 2021 Jan. 2022 May. 2022 Aug. 2022 Business Ambition for 1.5℃ TNFD Business for Land(B4L) PBAF Oct. 2022 NZBA (Partnership for Carbon Accounting Financials) (Science Based Targets initiative) (Taskforce on Nature-related Financial Disclosures) (Partnership for Biodiversity Accounting Financials) (Net Zero Banking Alliance) STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Woori Financial Group's ESG Vision & Strategy Good Finance for the Next VISION SLOGAN Woori Financial Group’s mission is to become the financial group that customers trust and love the most by maintaining its legacy as “the first bank under the sky in Korea.” Top 3 Strategies 011 Promoting ESG Management within the Group 2023 PLANS In July 2022, Woori Financial Group declared its commitment to 'Stakeholder Co-Pros- Growing Participation in Global Initiatives perity Management,' underscoring its respect for stakeholders (shareholders, customers, employees, partner companies, and local communities) in corporate activities. The com- mitment is aimed at protecting their rights and interests and creating long-term value for all involved. To bring this commitment into practical execution, the Group launched the 'Stakeholder Co-Prosperity Management Task Force Team (TFT)' in August 2022. Since its inception, the TFT has identified key tasks and completed 19 detailed tasks (approx- imately 61%) across ten primary sectors. These tasks include establishing a corporate culture of mutual respect and generating inclusive and societal value. Committed to environmental protection as part of its ESG commitment, Woori Financial Group became the first Korean company to join the TNFD (Task Force on Nature-related Financial Disclosures) in January 2022. In March, it was the only Korean company to participate in the Circular Economy Working Group of the UNEP FI (UN Environment Programme Finance Initiative). In May, the Group became the first company in the world to officially support the B4L (Business for Land) initiative, which aims to protect sustainable forests and improve land degradation. The Group subsequently signed an MOU with AFoCO (Asian Forest Cooperation Woori Financial Group plans to upgrade the three major environmental protection proj- ects—climate, biodiversity, and circular economy—that it has been promoting to achieve natural recovery and a circular economy transition. The Group is faithfully completing its environmental and social responsibilities by participating in and collaborating on initiatives to establish global environmental policies and standards, such as the International Plastics Agreement, the Global Biodiversity Framework, and the TNFD framework. Strengthening Climate Risk Responses Following its joining the NZBA in 2022, Woori Financial Group has been working on the details of its Net Zero Roadmap 2050. To begin, it is setting a target of reducing its fi- nanced emissions according to the global standards methodology, specifically the SBTi. In line with the TCFD (Task Force on Climate-related Financial Disclosures) recommen- dations, the Group will manage and monitor any risks and opportunities that may arise due to climate change, upgrading its climate risk management system by increasing the Organization) and conducted a feasibility study on REDD+ (Reducing Emissions from Defor- disclosure of relevant information. estation and Forest Degradation in Developing Countries) in Cambodia. This positioned Woori Financial Group as the first company in Korea's financial sector to address the climate crisis and preserve biodiversity through such sustainable forest management strategies. Certifications and Awards Apr. 2022 Promoting Stakeholder Rights Management Woori Financial Group prioritizes protecting and promoting the human rights of stake- holders. Led by Woori Bank, the Group is establishing and improving its human rights management process and systems so that it can establish comprehensive Group-wide human rights management practices. In this context, the Group is defining the human rights policies applicable to customers, partner companies, and local communities. Ulti- mately, it will draw upon its human rights management implementation and risk assess- ment to obtain new safety, health, and compliance management certifications. Expanding Eco-friendly Management Creating Social Value Enhancing Transparent Management Grand Prize in the Financial Holdings (Banking Sector) category at the 2022 Korea Leading Finance ESG Awards Top 9 Strategic Challenges • Promoting green finance •Establishing a climate change response system •Strengthening environ- mental management system • Expanding social finance • Enhancing financial consumers’ rights • Establishing a culture that respects human rights and diversity •Strengthening ESG finance management system •Disclosing ESG infor- mation tranparently •Advancing ESG gover- nance Nov. 2022 National Assembly Policy Committee Chair’s Award at the 2022 Korea Establishing and Expanding Diversity Goals ESG Communication Awards Mar. 2023 Woori Financial Group plans to establish, disclose and implement mid- to long-term goals for the culture of DEI (diversity, equity, and inclusion) and the systematic management of all goals. In addition, the Group will spread its culture of diversity and gender equality National Assembly Policy Committee Chair’s Award at the 2022 Korea by joining diversity-related indices (BGEI) and initiatives (WEP), as well as operating pro- Green Climate Awards grams to foster female leaders. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTSocial Responsibility Woori Financial Group is taking part in a wide range of social con- tribution activities to realize its ESG vision of “Good Finance for the Next.” Fostering Future Generations Fostering Future IT Leaders Woori Financial Group runs annual educational programs for underprivileged students attending vocational high schools in an effort to help them with their digital and IT learn- ing plans and career development. In 2021, 150 students were selected from low-income SOHO business owners to receive online lectures on API, web development, AI, big data, and digital security. In particular, employees of Woori FIS, a Group affiliate specializing in To help achieve this goal, the Group has established five key cor- total financial ICT services, imparted their profound knowledge from firsthand field expe- porate social responsibility (CSR) strategies in line with the United rience as part of this mentoring service. At the same time, diverse programs such as lec- Nations Sustainable Development Goals (UNSDGs) and its own tures from celebrities in the areas of digital and IT guided future generations with career industrial prudence. The five CSR strategies provide the roadmap exploration and skill development. as to how the Group will fulfill its systematic CSR activities and proj- ects. Under the firm belief that employees who are both happy and fulfilled can serve customers wholeheartedly, Woori Bank has es- tablished an Employee Satisfaction Center and is operating a wide range of programs to improve employee satisfaction. Woori Financial Group's Five CSR Strategies Fostering future generations: Promoting equitable opportunities for edu- cation, including finance education, and lifelong learning opportunities Inclusive finance: Encouraging inclusive and sustainable economic growth and creating jobs Protecting the environment: Responding to climate change and pursu- ing the sustainable protection and restoration of ecosystems Mécénat programs: Spreading the enrichment of values through sup- port for culture, art, and sports Supporting the underprivileged: Reducing inequality within and among 1 Company-1 School Finance Education countries and contributing to social integration 012 Woori Multicultural Scholarship Foundation Woori Multicultural Scholarship Foundation In 2022, the Woori Multicultural Scholarship Foundation provided 500 students from low-income multicultural homes with a number of different scholarships for the develop- ment of their specialties and talents, as well as their academic accomplishments. In addi- tion, the foundation gave out special scholarships to 100 children of pandemic-stricken SOHO business owners. All in all, a total of 600 students were granted scholarships total- ing KRW 830 million. Moreover, the foundation expanded its tailored support programs, including choirs, orchestras, and eco-friendly creative arts education, for multicultural children and families in support of social inclusion. In celebration of its 10th anniversary in 2022, the foundation actively publicized its suc- cessful programs and increased communication with multicultural families via social me- dia. It also organized a number of different competitions and events. As a result, the foundation earned the highest rating in all categories, including transpar- ency, accountability, and efficiency, in Korea GuideStar’s 2022 Comprehensive Evaluation of Non-profit Foundations. It was also singled out as the top non-profit foundation for three consecutive years in the same evaluation, solidifying its position as a highly respect- ed public organization dedicated to supporting multicultural families. 0102030405STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT013 Fostering Future Financial Leaders Resource Circulation Campaign Woori Bank is actively participating in a financial education program under the 1 Compa- From April to September 2022, students from 35 elementary schools nationwide and ny-1 School program operated by the Financial Supervisory Service to instill and improve Woori Financial Group employees participated in the Act for Nature with WOORI cam- the financial literacy of youth. As of 2022, 520 elementary, middle, and high schools were paign, where participants collected non-recyclable plastic from household items and up- in sisterhood ties with Woori Bank branches nationwide, providing a total of 550 in-per- cycled them into garden planters. The campaign collected and upcycled a total of 927 kg son and contactless sessions to 22,895 students from 154 schools. Furthermore, the of non-recyclable plastics into 1,000 planters, which were subseqently donated to create Woori Bank Museum runs the WOORI School of Economics for children from community indoor gardens inside the classrooms of participating elementary schools. childcare centers. In 2022, it offered 63 sessions to 992 future leaders. Through the Fostering Future Financial Leaders at Rural Vocational High School Project, Charity Walk Campaign the bank also subsidized 108 vocational high school students for obtaining financial certificates. On top of that, it provided them with career counseling and guidance for their financial careers. The “Let's Walk Together like Tiger” is an online-based charity walk campaign involving Woori Bank employees. In 2022, all the steps accumulated during the campaign were converted into a donation amounting to KRW 123 million and then given to social con- Since 1995, Woori Bank has been hosting the Woori Art Contest under the theme “Let's tribution projects. Woori Bank will continue the campaign in 2023, as it effectively serves Paint Together the World We Want” To date, a total of 6,279 children and teens, from pre- two causes—it addresses the carbon emissions issue and helps the underprivileged Woori Employee Charity Walk: “Let's Walk Together like Tiger” school to high school, have participated in this contest. through social contribution projects. Protecting the Environment expand the use of green renewable energy while reducing carbon emissions. Additionally, Woori Financial Group Future Foundation the revenue from solar power generation has contributed to job creation for the under- In 2022, all of Woori Financial Group’s subsidiaries came together and chipped in to cre- Subsidies for Solar Powerplants in Rural Areas Woori Bank has been promoting the construction of solar powerplants for social and economic communities in agricultural and fishery villages. The initiative entails efforts to Supporting the Underprivileged Woori Finance Forest of Life privileged and to local economic development. In September 2022, Woori Financial Group initiated the fourth forestation campaign, “Woori Finance Forest of Life,” at Bugu Middle School in Uljin, a rural area of the country that suffered significant damage from a massive forest fire in March. The reforested area was filled with local indigenous tree species and other species of trees with a high efficacy of reducing fine dust and cooling the urban heat island effect, offering shelter for students and local residents, and ultimately contributing to the healthier development of local communities. Another fire-damaged area measuring about 5,000 m2 in Okgye-myeon, a township near Gangneung, Gangwon-do province, had 700 pine tree saplings plant- ed there. During the tree-planting event called “Let’s Plant Together with our Heart and Earth!”, the bank donated firefighting equipment and supplies for fire prevention, including fire trucks. Woori Bank will continue its efforts for environmental protection through myriad eco-friendly social contribution activities in the future. ate a KRW 20 billion fund and establish the Woori Financial Group Future Foundation. This was done as part of the Group’s fulfillment of its social responsibilities as a financial company. The foundation spent the year working on its operational structure and organiz- ing teams and the workforce. In collaboration with the Seoul Metropolitan government and Doctors in Action, the Woori Financial Group Future Foundation opened the Woori Community Oral Health Center in the Donui-dong Cell Room Counselling Center, providing oral health improvement support to around 20 residents every week. On top of that, the foundation sponsored winter supplies to about 2,500 residents of the community. Group-wide donation events also took place, where subsidiaries donated Woori Future-Sharing Packages that consisted of ready-to- cook food and groceries to 5,400 low-income elderly citizens in the run-up to the Chuseok holidays. During the festive New Year season, Dream Support Boxes containing school sup- plies and toys were delivered to over 3,900 children from low-income families. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT 014 The Woori Financial Group Future Foundation is spearheading the Group’s commitment to supporting the underprivileged get by on their own two feet and improve the quality of Supporting Damage Restoration Efforts from Forest Fires and Torrential Downpours their life, thereby contributing to a better future for all. Holiday Grocery Gifts In January 2022, Woori Financial Group produced Woori Happy Boxes that contained an assortment of groceries. Employees at Woori Bank branches nationwide later delivered them to the Korea Association of Social Welfare Centers (KASWC), which then distributed the boxes to the underprivileged through its network around the country. The boxes were replete with significance, as they consisted of domestic products by social enterprises and SMEs, helping not only the underprivileged but also many pandemic-stricken SOHOs. Woori Financial Group donated KRW 1 billion to support the recovery from forest fires and provided assistance to affected residents in the Gangwon and Gyeongbuk provinces. In addition, major subsidiaries of the Group, including the holding company, bank, credit card company, and capital company, donated a total of KRW 2 billion to support recovery efforts for flood survivors and their livelihoods. After the outbreak of the forest fires and the heavy rainfall, the Group distributed emergency relief kits produced in collaboration with the Korean Red Cross. Food trucks capable of preparing 450 servings per meal were sent to feed refugees and volunteer workers in heavily affected areas as well. Woori Bank also opened the Woori Won Click Donation Box in online banking system to raise funds for disaster relief and recovery efforts for affected residents. The campaign raised a total of KRW 250 million from 7,383 donations to support disaster relief and recovery efforts, Energy Bill Subsidies for the Energy Poor ranging from forest fires on the country’s east coast in February 2022 and the torrential A Woori Financial Group Food Truck Woori Financial Group always does its best to help the energy poor prepare themselves downpours in August, to typhoon Hinnamno in September and the devastating earth- against heatwaves and cold snaps in various ways. In collaboration with 25 districts in quakes in Turkey and Syria in 2023. Seoul, social welfare workers associations, and local council offices, the Group delivered winter suppliers to 2,000 select households. The Group also subsidizes the energy poor so that they can catch up on their overdue electricity and water bills, enabling them to get through periods of extreme heat and cold healthy and sound. Employee Volunteer Activities Woori Bank actively engages in corporate social responsibility through regular volunteer activities and donation drives to support the underprivileged. For instance, the Woori Love Sharing Center program maintains sisterhood ties between the Group’s nationwide branches and local social welfare facilities in order to carry out regular volunteer services and make donations to local communities. In 2022, a total of 5,955 employees partici- pated in 629 volunteer sessions, donating approximately KRW 490 million in total. Addi- tionally, Woori Bank employees voluntarily donate a portion of their monthly paychecks to the Woori Love Fund, which had raised a total of KRW 380 million to deliver assistance to marginalized corners of our society in 2022. WOORI Senior IT Learning Center WOORI Senior IT Learning Center Delivery of Woori Happy Boxes on Lunar New Year’s Eve In addressing the social issue concerning the digital divide among the elderly population, Woori Bank established its first IT educational facility called WOORI Senior IT learning Center within a community center for elderly citizens located in an area with a high senior population in 2022. The program provides seniors with individualized IT training programs that cater to a wide array of daily needs for digital literacy. The first center opened in 2022 with five more centers scheduled to open in 2023. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTGovernance Governance Highlights As of the end of March 2023, the Board consists of a total of eight members (six independent directors, one standing director, and one non-standing director). The board, including the Audit com- mittee, is operating a total of six committees. Particularly, in order to preemptively implement ESG management strategy and execution framework, and to strengthen the group’s ESG governance, we have set up a ESG Management Committee since March 2021. 015 Woori Financial Group is committed to promoting sus- tainable growth to safeguard the interests of stakehold- ers such as shareholders and financial consumers, and we are doing our utmost to maintain a stable, efficient, and transparent governance structure. As a result, in 2022, Woori Financial Group earned an 'A' grade in the ESG assessment conducted by the Korea Corporate Governance Service, and an 'AA' grade in the MSCI as- sessment. Moreover, we achieved the accomplishment of being included in the Dow Jones Sustainability Indi- ces (DJSI) Asia-Pacific Index for two consecutive years. Governance Structure General Shareholders’ Meeting Board of Directors (8 directors) CEO Board Officer Candidates Recommendation Committee (All independent directors) • Tasks related to the recommendation of candidates for Executive Direc- tor, Independent Directors, and members of the Audit Committee • Fair verification of the qualifications of executive candidates as defined by relevant laws, regulations, and internal rules Strategy & Planning Department (BOD Office) Board Audit Committee (4 independent directors) • Supervision of the duties of directors and management •Appointment of external auditor and request for dismissal Audit Department Board Risk Management Committee (3 independent directors) Board Compensation Committee (4 independent directors) • Establishment of fundamental policies and strategies for risk manage- ment •Determination of an acceptable level of risk •Approval of appropriate investment limits and loss tolerance limits •Establishment and amendment of risk management standards • Assessment of the adequacy of the design and operation of the perfor- mance compensation system •Independently establish compensation policies and carry out duties •Determination of management candidates •Performance evaluation and compensation of executives •Managing annual reports disclosures and performance compensation updates Risk Management Department Management Support Department Board Group CEO Candidates Committee for Recommending Subsidiary Recommendation Committee Representative Director Candidates (8 directors) (7 directors) • Tasks related to the recommendation of subsidiary Executive Director candidates •Role in the establishment and modification of subsidiary management succession plans Board ESG Management Committee (All directors) • Matters related to the establishment of ESG management strategic di- rection and policy •Matters concerning important decision-making related to ESG manage- ment ESG Management Department STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTDiversity and Expertise of the Board Board Composition Diversity Woori Financial Group has constituted its board of directors, the supreme decision-making body, with experts from various fields who pos- Independent Director Candidate Pool sess a diverse range of experiences and knowledge, ensuring that it is not biased towards a specific background or profession. Director’s Key Expertise 9(9%) Others 12(12%) ESG 24(24%) Digital 8(8%) Consumer Protection Female Independent Director Candidate Pool ○ Male ● Female 100 Total 016 24(24%) Financial/Economics/ Business Management 23(23%) Law/Accounting (Unit: people) 30.5% 41.0% 50 2022 114 41 2023 59 YoY +10.5%p (As of Mar. 2023) DirectorFinancialEconomicsFinanceAccountingLegalESGChan-Hyoung Chung● ● In-Sub Yoon● ● Su-Young Yun● ● Yo-Hwan Shin● Sung-Bae Ji● ● Soo-Young Song●●Jong-Yong Yim●● Won-Duk Lee● DirectorIndependenceGenderKey ExpertiseDirector SinceChan-Hyoung ChungIndpendentMFinancial, Finance Jan. 2019In-Sub YoonIndpendentMFinancial, Accounting Jan. 2022Su-Young YunIndpendentMFinancial, EconomicsMar. 2023Yo-Hwan ShinIndpendentMFinancialJan. 2022Sung-Bae JiIndpendentMFinancial, Accounting Mar. 2023Soo-Young SongIndpendentFLegal, ESGMar. 2022Jong-Yong YimStandingMFinancial, EconomicsMar. 2023Won-Duk Lee Non-StandingMFinancialMar. 2022STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT017 03 STRATEGY REPORT GROUP VISION & STRATEGY GROUP-WIDE SYNERGIES DIGITAL INNOVATION GLOBAL BUSINESS RISK MANAGEMENT 018 020 022 024 027 STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTGroup Vision & Strategy Vision The Group's vision, "Innovate Today, Create Tomorrow,” delivers its commitment to pro- heritage from its parent bank, Daehan Cheonil Bank—established in the late Joseon viding better value to customers by concentrating all resources and expertise as a mar- period and meaning “The First Bank under the Sky”—and become the most trusted ket leader on innovation for tomorrow to ensure better value for customers. The Group’s financial group for customers. To that end, Woori Financial Group has defined its four slogan, “The First Choice in Finance," embodies its determination to inherit the Group’s core values as customers, trust, expertise, and innovation. 018 Despite challenging market conditions, Woori Financial group was able to post strong performance in 2022. Under the 2022 manage- ment goal of completing its framework to become a digital-based comprehensive financial group, the Group surpassed its previous year’s annual net income within the third quarter of 2022, with its financial soundness ranking atop the industry. Its bold investments and promotion of digital innovation and ESG management have also boosted its brand value and reputation. In 2023, the Group set its management goal of maintaining a competitive edge and enhancing its corporate value. To attain this goal and to consolidate its market position as a leading financial group, it plans to pursue seven strate- gies that will be outlined in the following page. VISION Innovate Today, Create Tommorrow Concentrating its resources and expertise as a market leader on innovating for today to deliver greater value to customers tomorrow SLOGAN The First Choice in Finance Inheriting a legacy of being the “First Bank under the Sky,” we are determined to become the most trusted and respected financial institution for customers CORE VALUE CUSTOMERS TRUST EXPERTISE INNOVATION Woori thinks of its customers Woori builds customer trust Woori Financial Group has the Woori shapes the future and the community first. based on principles. expertise to lead the market. through innovation. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT019 Woori Financial Group is pursuing the following seven strategies, firmly anchored in comprehensive risk management, to achieve robust and sustainable growth 2023 GROUP STRATEGY 01 Value-up of Business Core Competency 03 Expanding Customer-Centric Digital Platform 06 Rising to the Top of the Industry’s ESG Leadership Ladder Group subsidiaries will upgrade their profit bases by growing their customer bases so as to im- As it moves forward, Woori Financial Group will expand the customer base of its The Group will also spur up its ESG performance outcomes. To that end, it will take prove market positions in their respective industries. In the meantime, the Group will augment its banking credit card apps while also reinforcing its financial platform competitiveness the lead in ESG management with green businesses concerning climate change business portfolios in securities and insurance, where high growth potential is expected, while streamlining existing business lines, particularly asset management. In addition, it will maximize Group-wide synergies by increasing these types of business activities and developing a joint marketing system. Simultaneously, it will uncover a wide array of new business opportunities from the convergence between finance and non-finance operations stemming from the in- no-vation and financial deregulation measures that lifted the ban on the mingling of industrial and financial capital. so that it can get ahead of the pack in the digital innovation drive. At the same time, and circular economy issues and upgrade its win-win management practices for it is working on internalizing data and AI technology competitiveness and escalating shared growth with stakeholders. In the meantime, the Group is supporting the its expertise within its digital organization and its foundation of technology innovation government’s ESG policies by scaling up its ESG finance size and scope while through collaborations with startups. continuing external communication efforts to promote ESG management. 02 Promoting Differentiated Future Growth 04 Responsiveness to Uncertainties through Risk Management 07 Group System Level-up The Group is set to elevate its asset management operations. This upgrade will be fa- In addressing the macroeconomic uncertainties arising from interest rate hikes Lastly, the Group will prioritize the acceleration of innovation in its organiza- cilitated by achieving economies of scale through the strategic selection of products and a worldwide economic slowdown, the Group will keep the pace of its asset tional culture. This involves implementing strategic changes and advance- offered by the asset management firms and strengthening group-level support systems. Alongside, the Group plans to manage relationships with wealthy customers, and con- currently develop innovative new business models. Included in this initiative is a focus on enhancing the retirement pension business, aligning it with customer-driven asset management trends to secure a competitive stance in the pension market. Within the Corporate and Investment Banking (CIB) sector, there is an intent to adjust asset and rev- enue structures to cater to changes in both domestic and international IB environments, alongside expanding the Group's CIB collaboration. Globally, the strategy encompasses increasing profits by customizing business strategies based on regional characteristics, augmenting digital competitiveness in Southeast Asia, and bolstering global risk man- agement capabilities. growth under control as it also advances the quality of its asset portfolios. In ments based on individuals' abilities and expertise, while simultaneously ad-dition to preemptive management of the Group’s capital adequacy, it will fur- fostering a more innovative and creative corporate culture to enhance work ther tighten up the management of potential risks and upgrade the risk manage- efficiency. Additionally, the Group is actively developing a comprehensive ment system in preparation for the introduction of Basel III regulations. education program to empower its workforce and strengthen their competen- cies. Finally, the Group will persist in engaging in social contribution activities through Group PR campaigns and sports marketing to further enhance its brand value and reputation. 05 Fortifying the Internal Control System The Group will upgrade its internal control management system by improving work processes for preventing financial incidents, strengthening the internal control inspection system, and enhancing the expertise of the compliance monitoring or- ganization and personnel. Additionally, the Group will prioritize the enhancement of management to improve convenience and protect the rights of financial consumers. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Group-wide Synergies Since its establishment in January 2019, Woori Financial Group 2022 ACHIEVEMENTS Enhanced Group-wide Synergies Woori Financial Group celebrated its fourth anniversary in 2022. Throughout the year, all 14 subsidiaries worked together on 30 synergy projects and generated tangible results from cross-selling and affiliate marketing campaigns. For the systematic addressing of synergy issues and initiatives, different levels of meetings are convened according New Opportunities Captured and Growth Base Established The holding company’s role does not stop at merely providing support to the promotion of Group-wide synergies. In fact, it fine-tunes the details to facilitate the implementation of the unit tasks derived from the overseeing organization while also backstopping ex- cellent projects developed at the sales organization level to be turned into Group-wide initiatives. to the importance of the agenda: subsidiary CEOs participate in the Group Business As a result, a Group-wide collaboration network has been established for corporate Growth Support Meeting; the Group Synergy Council consists of all the executives in lending operations, with new Group synergy effects being created in the due diligence charge of initiatives; and unit meetings are held in the presence of working-level staff of work of banking operations. At the same time, the Group synergy base became consol- has expanded the scope of its synergies through the successive relevant projects. incorporation of additional subsidiaries. To strengthen its position as a comprehensive financial group, the Group has fostered in- Furthermore, the Group Synergy Bulletin Board and Group Synergy Idea Competition are instrumental in keeping employees active in synergy-creation activities and explor- idated upon a joint marketing system being completed, thus enabling interactive com- munication and stronger performance management with respect to inter-affiliate joint marketing efforts. ter-subsidiary collaborations across various business areas, lever- ing new business opportunities. These synergy systems have helped foster profit-gen- The Group has maximized its performance results on the back of synergistic strategies 020 aging these synergies to create new business opportunities. This approach has advanced its financial services and maximized profits. The Synergy Council, consisting of the holding company and all 15 subsidiaries, leads the way in Group-wide collaborations and com- munication, effectively generating tangible and practical synergy effects. erating models that focus on the Group’s core businesses. and projects, which were led by its flagship subsidiaries—Woori Bank, Woori Card, Woori Investment Bank, and Woori Financial Capital. Close communication and mutual understanding among subsidiaries have helped enhance the driving force behind the Group’s collaborations and affiliate projects. 15 subsidiaries Woori Bank Woori Card Woori Financial Capital Woori Investment Bank Woori Asset Trust Woori Savings Bank Woori Financial F&I Woori Asset Management Woori Venture Partners Woori Global Asset Management Woori Private Equity Asset Management Woori Credit Information Woori Fund Services Woori FIS Woori Finance Research Institute STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTExisting Subsidiaries (as of Jan. 11, 2019) Mar. 2023 Sustainable Growth 021 Newly acquired and established non-bank subsidiaries Continued efforts to grow the non-banking sector 2019 2020 2022 2023 SECURITIES LIFE INSURANCE PROPERTY INSURANCE Expand existing industries simultaneously GROUP-WIDE SYNERGY PLAN As part of this effort to strengthen the Group’s position as a comprehensive financial group, The Group is now poised to bring this about through inter-affiliate collaboration efforts so In 2023, Woori Financial Group will support its subsidiaries as they heighten their sales competencies so that they can all maximize the synergistic effects. The Group will also increase its support to subsidiaries in developing business strat- egies, selecting and systematically managing key sales projects. In addition, it will establish an organic collaboration system to concentrate synergies between key sales organizations of subsidiaries and between newly incorporated subsidiaries and existing peers, thereby further increasing performance-based compensation. Woori Venture Partners will receive all-out support at the Group-wide level as a new subsidiary as to raise the market share of both the banking and non-banking sectors for sustainable so that it can solidify its position within the Group and more effectively raise its market position. growth. Currently, without securities firms or insurance companies under its umbrella, Woori Any acquisition procedures will only proceed forward when they are certain to increase Financial Group is determined to bring them in through future mergers and acquisitions. the corporate and shareholder value of Woori Financial Group. Additional M&A oppor- The Group envisions utilizing these M&As to further strengthen its corporate subsid- tunities in the businesses of existing subsidiaries are also open for consideration if it is iaries by incorporating entities in the securities and insurance sectors. This strategic deemed necessary to strengthen their competitiveness and provide a chance for them approach aims to establish Woori Financial Group as Korea's most successful compre- to climb up the market ranking ladder. hensive financial group. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTDigital Innovation 2022 ACHIEVEMENTS Enhancing Data/AI Competitiveness In February 2022, the Group appointed an external expert as its chief digital officer In January 2022, Woori Bank became the first Korean financial institution to introduce (CDO). It then established and pushed a Group-wide digital strategy that focuses on a mobile driver’s license using DID (decentralized identity) technology, the first govern- boosting the number of monthly active users (MAUs) of its main platforms, building a ment-linked financial institution blockchain. This allowed the Group to preempt the digi- highly personalized data infrastructure, establishing a large-scale AI infrastructure, and tal-based business as a first mover and use it for financial transactions. In addition, Woori enhancing the development and management of digital experts. Financial Group is also working on an industry-first integrated customer data platform 022 The shift in financial consumption patterns—from visiting physical Reinforcing Group Platform Competencies branches to using virtual channels—has expedited digital transfor- Group platform competencies have been significantly enhanced, mainly through dig- mation efforts in the financial sector. Every market player is now ap- plying multifaceted steps towards digital transformation recognizing the significance of the digital landscape. Woori Financial Group set its strategic direction for Group-wide dig- ital transformation at strengthening its customer-centered platform ital-oriented, fundamental improvements, which included personalized marketing and digital product lineups. As a result, the combined MAUs of the Woori Bank and Woori Card apps surpassed the 10 million milestone by the end of 2022. On top of that, the Group serves its corporate clients with customized financial products through its WON Biz Plaza, which was launched in September 2022, and is Korea’s first digital platform dedicated to financial management on corporate supply chains. Also, the Group is and pursuing new businesses and technologies under a first-mover working on developing and constructing the strategies and systems required to make strategy. In line with this goal, the Group is working hard to become its banking app a universal banking app that can go into service in 2024. the No. 1 customer-oriented digital finance platform provider. based on its analysis of real-time offerings and the completion of development of its per- sonalized marketing tools. Furthermore, Woori Financial Group is one of the leaders in the generative AI model market, such as ChatGPT, as it is developing a finance-specialized language model in partnership with LG AI Research's super-giant AI "EXAONE." In November 2022, the Data Intelligence Planning Department was created to simulta- neously serve the holding company and Woori Bank, establishing a Group-wide data/ innovative technology governance and implementation system. Each subsidiary is urged to upgrade its competencies to realize a Group-wide standard and integrated data/AI competencies. Building the infrastructure that is so critical for Group-wide data sharing/integration and scaling up the affiliation within and outside the Group will gen- erate tangible outcomes from a high-quality data and system integration environment. Growing Digital Experts’ HRD and HRM Woori Financial Group has developed its career development program (CDP) guidelines and digital competency assessment criteria for the Group-wide systematic and integrat- ed management of the digital workforce and their competency-building. In particular, Woori Bank set up a designated team to further its bank-wide integrated digital marketing approach. MAUs of Digital Channels Woori WON Banking Woori WON Card over 10 million users (As of the end of 2022) STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTIn 2023, one of the important goals set by Woori Financial Group is to ensure the integrity of the Group platform, discover new business opportunities, and standardize and integrate the Group's data/AI competencies. Aligned with this goal, the Group will pursue the following five key initiatives to take the lead in its full-scale digital innovation. DIGITAL STRATEGIES FOR 2023 023 01 Quantitative/Qualitative Growth of Group's Flagship Digital Platform First, the Group is simultaneously promoting the quantitative and qualitative growth of its flagship platform to exceed 15 million MAUs at the Group-wide level so that it can complete its traf- fic-centered Platform 2.0. This, in turn, will allow for the transition to a value-creating Platform 3.0 by establishing the following platform base that contributes to attracting new customers and generating profits. 02 Seamless Integration for Customer-Centric Financial Platform Second, in a bid to offer the right financial platform that custom- ers need, Woori Financial Group is currently working to open a universal banking app in 2024 that will seamlessly incorporate the core services of Group subsidiaries on the bank’s flagship app, Woori WON Banking, which will also serve as the Group’s flagship platform, offering comprehensive services that range from the financial to the non-financial. 04 Proactive Response to Innovation and Regulatory Reforms for Future Growth Fourth, to ensure future growth engines, the Group will discover new industry opportunities that are free from compliance issues by pre- emptively responding to innovative technologies and the continuous monitoring of financial regulatory innovations. At the same time, it will increase its search for external growth opportunities through practical collaboration cases, such as strategic partnerships with tech firms that show potential technological prowess and investment value. 05 Strengthening Group-wide Digital Talent Finally, the main channel shift to digital has made a highly skilled dig- ital workforce the key success factor in the immediate future. There- fore, the Group is developing an integrated management systems guideline which will include flexibly hiring external digital experts, fos- tering new professionals to heighten digital core competencies, and creating a digital career development path for digital job duty analysis and management. Down the road, this will ultimately be promoted to a Group-wide integrated management system for the digital workforce. 03 Establishing Data/AI Governance and Driving Mega Value Third, the Group will create mega value through upward standardization and integration of its Group-wide data/AI competencies by establishing Group- wide data/AI governance and the necessary infrastructure. This will give the Group a differentiated competitive edge in the data/AI market by constructing a customer data platform and Hyper-Scale AI-based “AI Banker“ service. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT 024 Global Business Total Assets (As of the end of 2022) USD 38.4 billion Operating Revenue (As of 2022) USD 853 million Overseas subsidiaries Overseas branches Representative offices Woori Financial Group has expanded its presence in the high-profit and high-growth South Asian market, strengthened its digital channels, enhanced risk management, and established a global footprint in 24 countries across 569 locations. Woori America Bank AO Woori Bank (Russia) Woori Bank China Limited London Poland Hungary Tutu Finance-WCI Myanmar Woori Finance Myanmar WB Finance Co., Ltd.(Cambodia) New York Los Angeles Woori Bank Europe Gmbh (Germany) Banco Woori Bank do Brazil S.A. Bahrain UAE India Bangladesh Yangon Malaysia Singapore Woori Global Markets Asia Limited (Hong Kong) Seoul Japan Woori Wealth Development Bank (Philippines) Woori Bank Vietnam Limited PT Bank Woori Saudara Indonesia Sydney 569 Total Networks (in 24 countries) 13 Overseas Subsidiaries 14 Overseas Branches 8 Overseas Sub-branches 6 Representative Offices STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT2022 ACHIEVEMENTS Expanding Global Networks as Sustainable Growth Drivers Increasing Import/Export Financing Key FOREX Performance Results Woori Bank was the first Korean bank to open an overseas branch, which it did in Tokyo In order to build up import and export finance support, Woori Bank adopted new prod- Import/Export (Unit: USD billion) 025 in November 1968. Since then, the bank has constantly broadened its global network. ucts, including the Import/Export Finance Package for Excellent Companies, and im- In fact, it achieved another first as a Korean bank in 2014 when it acquired a listed bank proved its non-insurance guarantee system to boost the number of corporate clients for overseas and launched Bank Woori Saudara in Indonesia. In 2016, it then acquired a its trade finance services. The bank also supported on-site inspections at companies in savings bank in the Philippines, and has since worked on synergies with its partner the aerospace/defense industries to strengthen the marketing of these national growth company, Vicsal Development Group. Not long after this, in 2018, Woori Bank Europe industries. 4 5 5 4 . 3 9 3 5 . 3 1 6 6 . GmbH commenced operations in Germany, and in 2021 the bank’s Cambodian sub- sidiary converted into a commercial bank, bringing the bank’s global network to 464 offices by the end of 2022. In addition, Woori Bank is building solid partnerships and collaborative ties with lead- ing global banks. Through the stable management of its credit lines, the bank supplies financial support to Korean companies and local companies in overseas markets as it also facilitates import and export transactions between international companies with its trade finance techniques in L/C transactions, purchased foreign exchange, banker’s usance, and payment guarantees. While simultaneously carrying out its capital increase and substantial growth cen- tered on high-yield quality assets, the bank has implemented a two-way strategy in Heightening Compliance & Internal Controls Post-pandemic volatility led to risks abounding in global financial markets. In response, 2020 2021 2022 Woori Bank preemptively tightened up its asset quality control to minimize its non-per- forming loans (NPLs). All related departments at the headquarters jointly operate the Working-level Council to share major issues requiring countermeasures and checks for Remittance any possible support or resources available at the headquarters level to enhance their global compliance capabilities. Additionally, the bank also provides its compliance per- sonnel with outsourced education programs to help them develop job expertise. 2 8 8 7 . 1 9 3 0 . 1 4 3 0 . 2020 2021 2022 YoY +15.7% (Unit: USD billion) YoY +49.5% embracing global markets. Whereas it strategically localizes its marketing approach to Upgrading Digital FOREX Products/Services emerging markets by bolstering its retail banking product lineups targeting local retail customers, it focuses on reinforcing corporate finance competencies, such as IB and foreign exchange, in developed markets. In 2022, Woori Bank upgraded the convenience in the entire process of online out- bound remittance and foreign currency deposits to enhance the business infrastructure of its retail FOREX products/services. It installed unmanned currency exchange ATMs at Incheon International Airport and virtual channels for foreign exchange declaration Fortifying the Bank’s Global Digital Banking Infrastructure In coping with global financial market changes, as well as to take the lead in global fi- nancial market trends, Woori Bank continues to heighten its digital channel competitive- ness. Today, its key retail banking subsidiaries in Southeast Asia—Vietnam, Indonesia, and Cambodia—are developing diverse digital banking products tailored to local market demand. At the same time, these local subsidiaries continue to enhance their conve- nience with their digital channels by introducing affiliate services with market-leading local fintech firms, corporate digital finance services, and new life-embedded services, including recharge and payments with e-wallets. while also upgrading its authentication processes. Furthermore, the bank institutional- F/C Exchange (Unit: USD billion) ized an on-site due diligence regulation for first transactions of import/export remittanc- es to expand its marketing opportunities and attract new regular clients. At the same time, it advanced the filtering and computer control systems for crypto asset trading exchanges and for counterpart banks to establish a preventive process and internal control of abnormal overseas remittances. 2 0 . 1 5 . 0 9 . 2020 2021 2022 Note) 2022 net income attributable to controlling interest YoY +118.4% STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT026 GLOBAL STRATEGIES FOR 2023 01 Core Competency-Building and Digital Innovation 02 Increasing Trade Finance Support to SMEs and to New Growth Sectors 04 System Upgrades to Provide Greater Customer Convenience In the high-growth, high-profit Southeast Asian markets, local subsidiaries will Woori Bank is developing big data-based product marketing strategies cus- Woori Bank is planning to upgrade its Woori Global Banking app for foreign increase their marketing to local customers by broadening their retail products tomized to the particular needs of profit-generating SME and ME exporters. customers, with increased language support aimed at making the digital plat- and regional sales force to meet local demands as well as by upgrading their For instance, the bank has already launched a usance remittance service to form more convenient for foreign customers. Furthermore, the bank is devel- digital platforms. And while small-sized local subsidiaries will improve their as- timely finance importer corporate clients. While expanding its direct import/ oping a solution to adapt to the new platform for external payment settlements sets through capital increases and further entry into growth potential markets, export marketing campaigns on key new growth sector businesses, such as and text message exchanges by converting its MT-based SWIFT message overseas branches will concentrate their marketing resources not only on ex- in defense, pharma-bio, rechargeable batteries, gaming, and IT (platform), the into an MX-based format. It is also broadening its service coverage on digital panding transactions with local branches’ corporate clients and trading firms bank also has plans to set up a special program to help working-level staff of channels by establishing a virtual process for F/C payment guarantees. but also on boosting their ability to make significant IB deals. On top of that, corporate clients build their capabilities in import/export businesses. the bank plans to make intensive investments centered on building IT infra- structure in high-growth markets to fortify its digital channel competitiveness. Woori Bank is also exploring a wide range of options for entry into new local markets, such as M&As, equity investments, or strategic alliances with local internet-only banks. Its channel efficiency drive will remain on course, as it currently plans to close and integrate more branches to achieve profitability. For Korean employees, they will receive intensive training before they leave for 03 Strengthening the Competitiveness of FOREX Platforms 05 Solid Risk Management & Internal Controls their assigned overseas offices, which will also hire local employees for local- In 2023, Woori Bank will reinforce its FOREX platform competencies. To begin, In the aftermath of the pandemic, the bank has been preemptively managing ized marketing activities. it launched the Woori WING outbound remittance service through a business its asset quality to prevent insolvencies on the part of its corporate clients alliance with Cambodia’s WING Bank for real-time, small-amount outbound while also upgrading its internal control systems, including those related to remittances. In addition, the bank is constantly taking its FOREX retail platform anti-money laundering and operational risks. At the same time, Woori Bank competitiveness to new heights with various services: a payment platform has become the first Korean commercial bank to institutionalize an on-site for overseas payments based on an F/C exchange purse service; a digital F/ due diligence regulation on businesses prior to their first import/export trans- C deposit service that is linked to securities firms to keep up with the growing actions, which will help the bank establish a genuine and legitimate FOREX trend of overseas investments by retail investors; a digital F/C deposit service sales practice in the long run. The bank is also building up its internal controls in alliance with airlines to serve the growing demand of overseas travelers; an through a scoring system for risk assessment of corporate clients’ remittances, increase in the outbound remittance service coverage to promote affordable systematizing the data management process as it monitors all these activities and swift small-amount remittance services; and an enhanced FOREX retail through the Working-Level Council for Preventing Abnormal Transactions. platform that is more competitive through affiliated remittance services in alli- ance with global fintech firms. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT 027 Risk Management 2022 ACHIEVEMENTS Woori Financial Group Woori Bank In 2022, the U.S. Fed aggressively raised its interest rates, with cen- tral banks around the world following suit. Consequently, instability In the second half of 2022, the Group implemented a Group-level risk management Woori Bank upgraded its corporate early warning system and retail alternative credit enhancement plan to strengthen its financial soundness and capital adequacy man- rating model to constantly reduce potential risky loans and expanded credit monitor- spread across financial markets across the globe, drawing down agement. The plan consists of three key tasks: 1) slowing down the excessive asset ing, such as conducting a special review of susceptible sectors in 2023. Due to the economic growth worldwide. Potential credit risks were looming growth rate of non-bank subsidiaries, whose clients are largely composed of marginal post-pandemic effect, industries subject to expanded credit monitoring grew by 2.5%p from falling asset values and surging interest payment burdens. Against this backdrop, Woori Financial Group prioritized enhancing its total loss-absorbing capacity (TLAC) and established the Group- wide Crisis Response Council to keep its Group-wide risk manage- ment under control. customers; 2) limited handling of high-RWA, high-risk large-scale exposures (PI, PF, from the previous year, consequently improving the quality of the bank’s loan portfolio. and builder-guarantee trusts); and 3) absorbing the shocks from fluctuating foreign ex- Then, in a bid to upgrade the customer asset management system, the bank strength- change (F/X) rates, such as foreign currency (F/C) assets and derivatives. These tasks ened the monitoring of non-deposit products and established a financial investment were carried out under the supervision of the Group Crisis Response Council—a crisis product risk management system. Furthermore, the Bank-wide Crisis Response Council response organization attended by the Group’s chief risk officer (CRO). As a result, the began looking into major issues, such as BIS ratio liquidity and real estate PF, and later Group was able to tame the asset growth rate and proactively control high-risk assets developed and implemented countermeasures. and F/C assets, thereby partially absorbing the adverse impact of the BIS ratio stem- ming from intensifying market volatility. In 2022, Woori Financial Group was singled out as one of the “systematically important financial institutions” under the Act on the Structural Improvement of the Financial In- dustry, and subsequently submitted a government-mandated recovery plan. In prepa- ration for the Basel III liquidity requirements, the Group has also completed its liquidity coverage ratio (LCR) calculation system. Accordingly, all non-bank subsidiaries—Woori Card, Woori Capital, Woori Financial Investment, and Woori Savings Bank—can obtain and calculate their daily LCR data. By the end of September 2022, Woori Financial Group had safely met all of the Finan- cial Supervisory Service’s requirements, with its independent audit’s IFRS upgrade ratio standing below 9% and its FX GAAP PSI ratio at less than 12%. The Group also partici- pated in the FSS’s Internal Control Improvement Task Force Project. Under the program, the Group developed internal control innovation tasks to prevent any potentially damag- ing financial incidents and regain market confidence through such measures as tight- ening controls over susceptible parts of its asset portfolio, enhancing internal control capabilities, establishing a sound internal control culture, and augmenting its accident prevention monitoring systems. ㅍ STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTRisk Management Governance The Group’s risk management organization comprises the holding company and sub- sidiaries sharing authorities and functions. While each subsidiary independently oper- ates risk management committees, the holding company’s risk management committee is the highest decision-making body for the Group-wide risk management policies. Board of Directors CEO Risk Management Committee Risk Management Division Group Risk Management Council Risk Management Department Risk Model Validation Department 028 GROUP-WIDE RISK MANAGEMENT STRATEGIES In the face of turbulent macroeconomic landscape, Woori Financial Group has set its goals to become more resilient to crises. reflecting in our strategic goals to : 1) Building a solid crisis-resilient portfolio, 2) Prioritizing capital adequacy and liquidity management, 3) Managing credit risk of vulnerable sectors, and 4) Upgrading the Group risk management system 01 Building a Solid Crisis-Resilient Portfolio 03 Manage Credit Risk of Vulnerable Sectors First, in order to build a crisis-resistant Group portfolio, it will improve the quality Third, the Group will manage credit risks in vulnerable sectors. The deterio- of the Group portfolio so that it will remain unswayed by any significant shifts in rating macro indicators in 2022 can develop into deteriorating the real econ- the financial paradigm. Departing from a short-sighted performance-driven ap- omy in 2023, giving rise to concerns over surging insolvencies. The Group proach, the Group will also tightly distribute the risk limits and controls to avoid will strive to cut the potential insolvency of marginal borrowers at source any short-term performance-driven business activities. through measures such as intensive monitoring of marginal borrowers and tighter management of a potential insolvency monitoring system. In addition, the Group will prudently handle and manage high-risk assets, such as PIs and PFs, to minimize the potential adverse impact on its asset quality. 02 Prioritizing Capital Adequacy and Liquidity Management 04 Upgrading the Group Risk Management System Second, capital adequacy and liquidity management will remain at the top Fourth, the Group risk management system will be upgraded. In preparation of the risk management priority list. Until financial markets are stabilized, the for a series of new regulations, including the Basel III final reform package Group will focus on maintaining capital adequacy through a prudent asset (market/operational risks) and those related to climate risks, the Group will growth strategy centered on low-risk assets while also minimizing its asset preemptively uncover potential risk factors and take appropriate counter- growth. In preparation for intensifying competition in funding markets, the measures as it proactively meets the new requirements. Group will upgrade the Group liquidity risk management system and preemp- tively secure liquidity sources to augment its funding capacity. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT RISK MANAGEMENT STRATEGIES FOR 2023 : WOORI BANK Woori Bank’s risk management goal is centered around comprehensive risk management to ensure robust preparedness against crises. In order to achieve this goal, the bank will be diligently advancing the following four strategies : 029 01 Preemptive management of potential insol- vency risks 03 Strategic response to risk regulations At the same time, Woori Bank will establish a bank-wide legal compliance cul- ture that is based on improved accident prevention programs and customized inspection systems. First, it will preemptively manage potential insolvency risks. In particular, the Third, it will strategically respond to risk regulations. As a result, the bank will bank will tighten up its credit risk management of the vulnerable sectors in its strategically manage its liquidity and interest rate risk indicators to optimize retail and corporate assets. In dealing with post-pandemic economic uncer- its assets and liabilities at each interest rate level. Further to that, it will bolster tainties, the bank is also optimizing its loan portfolio and improving its global its market and operational risk management systems to safely introduce all To begin, the bank will tighten up its program for preventing any unforeseeable financial incidents. As it continues to implement the required tasks under the FSS’s Internal Control Improvement TF Project, the bank will also check its implementa- tion of accident prevention improvement tasks, revamp and stabilize the mandato- and IB exposure management processes to reinforce its control over high-risk, the new regulations while developing a suitable framework for measuring and ry leave system, and systemize all accident prevention measures. high-growth sectors. managing its climate risks. 02 Risk management for capital adequacy 04 Risk management coverage expansion Second, capital adequacy will be at the center of the bank’s risk management. Fourth, risk management coverage will be expanded. As it reinforces its gov- Second, in order to establish a customized monitoring system, the bank will advance the inspection method at the department and division levels. While strengthening the inspection of the DT/IT departments at the bank’s headquarters, the bank will use RPA and AI technology to enhance the efficiency of monitoring the sales network. On top of that, anti-money laundering (AML) procedures and functions will be upgraded to establish advanced AML practices within the bank. It will also improve its global legal compliance monitoring system to conduct joint due diligence on the global network as well as to reinforce cross-border AML sys- As such, it will refine the calculation criteria and standardize the analysis and ernance of operational risk management to enhance its management system, tem verification. monitoring system for methodical management of risk-weighted assets while the bank will also establish a well-organized controlling structure. Additionally, Finally, the bank will establish a more robust legal compliance culture. As part of also building and managing its positions to minimize its market sensitivity. it plans to heighten the risk management related to IT and outsourcing proj- this effort, it will re-establish a legal compliance reporting and management system Moreover, to achieve appropriate growth, it will effectively distribute and timely ects to refine its digital finance risk management system. By upgrading its manage its internal risk-weighted capital. customer investment product risk management, the bank will enhance its risk management capacity, including its asset allocation strategy. that includes a compliance program and legal procedures management system. Also, the bank plans to introduce a training curriculum for compliance monitoring, add a financial law training course to its law school curriculum, and is even consid- ering a mandatory internal training course on internal controls customized to job ranks and duties. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT030 04 BUSINESS REPORT GROUP BUSINESS PORTFOLIO WOORI BANK WOORI CARD WOORI FINANCIAL CAPITAL WOORI INVESTMENT BANK WOORI ASSET TRUST WOORI SAVINGS BANK WOORI FINANCIAL F&I WOORI ASSET MANAGEMENT WOORI VENTURE PARTNERS WOORI GLOBAL ASSET MANAGEMENT WOORI PRIVATE EQUITY ASSET MANAGEMENT WOORI CREDIT INFORMATION WOORI FUND SERVICES WOORI FIS WOORI FINANCE RESEARCH INSTITUTE 031 032 041 043 044 045 046 047 048 049 050 051 052 053 054 055 STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTGroup Business Portfolio Since the launch of its holding company in 2019, Woori Financial Group has continued to expand its non-bank business portfolio through back-to-back mergers and acquisitions of Woori Asset Management, Woori Global Asset Management, Woori Asset Trust, Woori Financial Capital, and Woori Savings Bank. In January 2022, the Group invested KRW 200 billion capital and launched Woori Financial F&I, an NPL investment subsidiary. After a preliminary review for acquisition of a venture capital (VC) company, the Group selected Daol Investment as its new acquisition target. As Korea’s first-generation VC, Daol Woori Savings Bank Investment was operating the market’s fifth-largest VC AUM before the acqui- sition. In December 2022, Woori Financial Group’s board of directors approved the acquisition proposal, with the subsequent legal procedures quickly gaining momentum and moving forward. In February 2023, the Group signed a share purchase agreement with Daol Investment & Securities to acquire a 52% stake in Daol Investment. As soon as the deal closed in March 2023, Daol Investment Woori Financial F&I Woori Asset Management became the 15th subsidiary of Woori Financial Group and now operates under Woori Venture Partners its new name, Woori Venture Partners. 2022 Synergy Milestones Jan. 7. 2022 Woori Financial F&I launched Dec. 16. 2022 BOD approved the proposal of acquiring Daol Investment Feb. 27. 2023 Signed a stock purchase agreement to acquire a stake in Daol Investment Mar. 23. 2023 Incorporated into the Group under the new Woori Global Asset Management Woori Private Equity Asset Management Woori Credit Information Woori Fund Services Woori FIS name Woori Venture Partners Woori Finance Research Institute Woori Bank Woori Card Woori Financial Capital Woori Investment Bank 100% 100% 100% 58.7% 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. Woori Global Markets Asia Limited (Hong Kong) Woori Bank Vietnam Limited Woori Asset Trust 72.27% Woori Wealth Development Bank (Philippines) 031 99.88% 100% 100% 84.20% 100% 100% 100% 100% 51% 100% 100% 100% 84.51% 100% 100% 33.33% 5% 0.47% 19.61% 6.05%* 15 20 (As of Mar. 2023) Woori Finance Myanmar Woori Bank Cambodia PLC Woori Bank Europe Gmbh (Germany) Woori Finance Indonesia Tbk Tutu Finance-WCI Myanmar Woori Venure Partners US KTB NHN China Private Equity Fund KTBN GI Private Equity Fund Arden Woori Apparel 1st Private Equity Fund Woori-Dino No.1 PEF Green ESG Growth No.1 Private Equity Fund *30.26%(including shares held by Group Companies) First-level Subsidiary Second-level Subsidiary 100% 100% 73.0% 52% 100% 100% 100% 100% 100% 100% STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Woori Bank www.wooribank.com Retail Banking 2022 ACHIEVEMENTS Plan pegged its interest rates to fluctuating market base rates, which kept rising at an abrupt pace over the past year. As consumers could take full advantage of the ever-ris- ing interest rates at a secured pace with that product, the savings plan had made KRW 21 trillion in sales by the end of 2022. Given that it was launched in July 2022, this was Digital Marketing Aimed at Expanding the Customer Base a remarkable sales record in just a six-month period. 032 Founded in 1899, Woori Bank stands as Korea's pioneering domestic in-person marketing and sales activities at branches, the bank switched its marketing commercial bank. Throughout its history, Woori Bank has weathered a base to its WON Banking mobile app and engaged in online retail marketing strategies. 2023 PLANS Headquarters-Led Digital Marketing to Attract New Customers As a result, retail customers found it easier to access Woori Bank’s extensive content In order to secure new customers, the bank’s future growth drivers, Woori Bank estab- Woori Bank’s retail customer base grew by 390,000 people from the previous year to reach 24.53 million in 2022. With the prolonged pandemic essentially cutting off number of turbulent periods, such as the Japanese colonial era, the Kore- an War, and the 1997 Asian financial crisis, thanks in large measure to the unwavering support of its dedicated customers. In the current landscape, which is marked by heightened volatility in financial markets and intense competition in the realm of financial platforms, Woori Bank is committed to the implementation of customer-centric business practices. Its central aim is to bring forth innovative financial services that seamlessly con- and financial products on the virtual platform. Woori Bank has been channeling its bank-wide resources into becoming the No. 1 financial platform company. These efforts paid off when its WON Banking mobile app reached 7.19 million MAUs as of 2022. This marked an impressive increase of 1.55 mil- lion MAUs, or 27.5%, from 5.64 million at the end of 2021. To further promote use of the app, the bank launched new services, such as a retail loan interest rate inquiry service, a stock trading service, and a one-stop affiliate loan service. The bank also mounted a nect with all aspects of its customers' lives. Looking ahead, Woori Bank number of different events and marketing campaigns to attract more customers to its will continue to prioritize customer satisfaction as their bank of choice, services, including an event called “Salary Up for Employees.” attentively listening to their needs, and remaining attuned to the evolving Through its consistent efforts to understand market needs based on its powerful mobile market landscape as it strives to foster mutual growth. platform, Woori Bank’s financial products were well received by the market, with some of them even taking home industry-linked prizes. For example, the WON Plus Savings lished a strategy that takes full advantage of its marketing channels. As such, the head- quarters will control the bank-wide digital marketing campaign to attract new custom- ers, while retention and expansion of transactions with existing customers will be led by branches and concierge channels. Strengthening Content-Based Marketing Woori Bank established a strategy to utilize new non-financial services, such as cultural content, to attract customers through the WON Banking platform. In fact, the bank has set up its own cultural content called WON THE WORD, which will host mega-size con- certs and musical performances targeting Gen MZers. At the same time, the bank plans on running seasonal events based on its LCK sponsorship and affiliate marketing with the Woori Bank Cup LOL League competition. No. of Retail Banking Customers (Unit: 1,000 persons) Total Retail Banking Deposits (Unit: KRW trillion) Total Retail Banking Loans (Unit: KRW trillion) , 2 3 8 3 5 , 2 4 1 4 5 , 2 4 5 3 3 1 0 9 4 . 1 1 3 6 . 1 2 4 7 . 1 3 1 6 . 1 3 9 9 . 1 3 5 0 . YoY +388(+1.6%) +11.1(+9.8%) YoY YoY △4.9(△3.5%) 2020 2021 2022 2020 2021 2022 2020 2021 2022 STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT033 Corporate & Institutional Banking Corporate Banking 2022 ACHIEVEMENTS 2023 PLANS In 2022, Woori Bank broadened its corporate banking operations. The bank tapped into In 2023, Woori Bank Corporate Banking Group will strive to achieve excellent results the captive network of its large-corporate clients to reach their employees and partner befitting its reputation as a leading financial institution by providing financial products companies as it actively sought out CIB/global and DT, as well as cross-industry alli- and services tailored to the needs of the market and customers, thereby dramatically ances to expand its corporate client base. It also unearthed new funding needs for large increasing both its asset portfolio and its profits. corporations and MEs and achieved significant growth both qualitatively and quantita- tively, while preemptively managing potential non-performing assets to enhance asset soundness. As a result, its total asset size grew by KRW 4.7 trillion, or 3.6%, over the previous year to reach KRW 135.2 trillion, with a record-high net operating revenue of KRW 933.2 billion, a whopping growth of KRW 292.1 billion, or 45.6%, over the previ- ous year. Specifically, its net interest income showed strong growth, jumping 74.6% to First, it will increase loans to outstanding corporate clients to assist their growth and act as a stepping stone for the development of the Korean economy. Second, it will provide financial products that cater to specific customer needs, such as foreign exchange/derivatives, electronic finance, and retirement pensions, while also carrying out customer-centric business activities. reach KRW 706.9 billion by the end of 2022. Third, it will tap into its captive network of large corporate clients to conduct total mar- keting initiatives targeted at their employees and SME partners by offering a range of financial solutions. Institutional Banking 2022 ACHIEVEMENTS Finally, it will continue its efforts in contributing to establishing ESG management prac- Woori Bank is actively expanding its transactions with governmental agencies, local gov- tices among large corporations. Recently, ESG management has become the new norm ernments, and major public institutions. It has established itself as a locally engaged fi- at top businesses. Woori Bank will support corporate clients with their ESG efforts by nancial institution through various social contribution projects for the development of local signing ESG agreements with large corporate clients. communities where it operates. Since March 2018, it has been the primary bank for the This is one way that Woori Bank serves its social responsibility and continues to build new cases ensuring win-win growth for both the bank and customers alike. Corporate Clients’ Transactions and Net Operating Profit Total Deposits/Loans (Unit: KRW billion) Net Operating Profit (Unit: KRW billion) 1 3 0 5 2 1 , 1 3 5 2 2 1 , 1 1 8 6 1 2 , +4,700(+3.6%) YoY 9 3 3 6 4 1 5 5 4 +292(+45.6%) YoY 2020 2021 2022 2020 2021 2022 National Pension Service Fund (NPSF), one of the world’s top three pension funds. In fact, its AUM amounts to KRW 938.3 trillion. In 2022, Woori Bank succeeded in retaining the primary bank contract with the NPSF. That same year, it also offered institutional banking services as the primary bank for 107 out of 350 public institutions, as designated by the Ministry of Economy and Finance. As of FY 2022, Woori Bank was conducting transac- tions with over 5,000 institutions, with a total AUM amounting to KRW 29.6 trillion. Today, Woori Bank operates a professional team of system operations specialists under its Institutional Public Funds Customer Department, providing best-in-class financial solutions to carry out governmental and public institutions' policies and projects. In 2022, the bank supported a number of government policy-related projects, such as the jobseeker allowances program for the Ministry of Employment and Labor, while also serving as the primary bank for emergency job security grant payments and the integrated Ezbaro Bank of the National Research Foundation of Korea. Leveraging its expertise in differentiated cash management systems, the bank entered into MOUs with several institutions, including Sports Toto and the SME Corporate Pension Fund, proving its successful function as a specialized bank for a wide range of institutions. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTWoori Bank’s Institutional Banking Group began as a national bank in 1915 and has since become the undisputed top local government bank in Korea. Going beyond mere budget management, it also serves as a partner for key regional development projects. In partic- ular, its distinctive fund management system know-how has established entry barriers to becoming a primary bank for institutions in Korea. In 2022, despite aggressive bidding by contenders for the Seoul Metropolitan government’s vault bank, Woori Bank successfully landed the vault bank service for Seoul’s 14 district offices, reaffirming its unparalleled market position as a bank with the world’s very best vault computer system. SME Banking 2022 ACHIEVEMENTS As of the end of 2022, Woori Bank was serving 1.93 million SME customers, including SOHOs and SMEs, and handling a total of KRW 118.1 trillion in loans and KRW 77.3 trillion in deposits. Its total assets grew by KRW 7.1 trillion from the previous year, and were mainly centered on high-profit blue-chip companies. By strategically expanding loans to prime SME borrowers and preemptively reducing potential NPLs worth KRW 1.2 Pioneering New SME Markets In June 2022, Woori Bank successfully launched the International Air Transport Asso- ciation (IATA) clearing bank service, tapping into affiliate member companies for main banking partnerships. In September 2022, it became the first Korean bank to open a digital supply chain platform, WON Biz Plaza, encompassing all SME financing support and digital transportation through an e-procurement process, as well as financial and business support services via corporate internet banking services. As part of an MOU with Seoul Guarantee Insurance, the bank also launched the Woori SGI Agreement Working Capital Loan, which utilizes non-financial data from the WON Biz Plaza plat- 2023 PLANS The year 2023 is expected to present significant challenges for financial institutions, primarily due to the absence of the favorable impact of interest rate hikes that con- trillion, the bank’s prime asset ratio stood at 86.7%. New loans increased to businesses in the Green New Deal Project and energy industry, as did microfinance loans to small form. business owners. In total, the bank provided KRW 3.1 trillion in new funds as part of the tributed to banks' profitability in 2022. As the global tapering process takes effect this Korean New Deal and ESG financing. Leading the Digital Corporate Finance Market 034 year, following the quantitative easing measures implemented during the pandemic, financial institutions are likely to encounter increased difficulties. In response to these circumstances, Woori Bank, as the leading bank in Korea with a substantial number of Tightening the Safety Net for SMEs and SOHOs institutional clients, has developed strategic plans to expand its liquidity provision to institutions and local governments. Moreover, Woori Bank aims to enhance its digital financial services to better serve an even greater number of public officials, ensuring an optimal and convenient customer experience for their financial requirements. To further its profitability, the bank will carry out a wide array of strategic operations, such as bidding strategically for municipal treasury services, bidding for a court escrow bank service, and engaging in strategic marketing campaigns to attract more institu- tions, cooperatives, and associations. Major Partners Major Local Government Partners 14 District Offices in Seoul, and Gwangmyeong City Major Ministry/Public Institution Partners Ministry of Land, Infrastructure and Transport, Korea Disease Control & Preven- tion Agency, Korea Post, National Pension Service, National Health Insurance Service, Korea Housing Finance Corporation, Korea Land & Housing Corporation, Seoul Housing and Communities Corporation, Korea Electric Power Corporation, KOTRA, Korea Railroad Corporation, Korea Exchange, Korea Securities Deposi- tory, Korea Public Finance Information Service, Korea Workers’ Compensation & Welfare Service, Korea Transportation Safety Authority To supply liquidity to SMEs and SOHOs suffering from the economic slowdown, Woori Bank contributed a total of KRW 65.7 billion in special funds to the Korea Credit Guar- antee Fund, Korea Technology Guarantee Fund, and regional credit guarantee foun- dations, giving preferential guarantee fees and ratios to all recipients of the funds. The In order to lead the digital corporate finance market, Woori Bank partnered with big tech firms and launched new tailor-made products. One example of this was the Naver Smart Place Loan, a digital secured loan for Naver Smart Place tenants. It also devel- oped a stronger platform and service capabilities by renewing its corporate internet banking platform and digital authentication services for corporate clients. To enhance the marketing capabilities of its sales force, the bank also released the RM WON mobile marketing app, an instrumental marketing tool for all branch managers, relationship bank also lent a total of KRW 3.7 trillion in guarantee loans to the underfinanced, many managers, and corporate service staff. of whom lack decent valued collateral of any kind. In support of SOHOs faced with dif- ficulties from the COVID-19 pandemic, the bank also set up and operated nine SOHO Support Centers across the nation. The centers provided comprehensive financial and non-financial consulting services, such as crisis management consulting on sales recovery and online market entry, startup consulting on market research and startup procedures, and financial consulting that includes policy finance. Total SME Loans (Unit: KRW trillion) Prime Asset Ratio (SMEs) (As of the end of 2022) 86.7% 9 7 9 . 1 1 0 5 . 1 1 8 1 . No. of SOHO & SME Customers (As of the end of 2022) 1.93million 2020 2021 2022 YoY +7.6(+6.9%) STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT 035 Digital Banking 2022 ACHIEVEMENTS A Customer-Oriented Financial Platform In April 2022, the Woori WON Banking app redesigned its UX/UI, including a person- alized home screen, and in November adopted a simpler sign-up process than before, thereby enhancing the overall mobile banking customer experience. Its new life con- venience features include Gifting (October), virtual assistant service(November), and Pedometer (December). In addition, more participatory and game-play events were launched to increase traffic on the app during this time as well. In particular, the new Daily Walk Savings Plan, which was launched as part of the bank’s ESG initiative, was linked to the Pedometer service and offers up to 11% interest rates to subscribers who walk 10,000 steps or more every day, which made it an instant hit product. At the same time, Woori Bank is broadening its platform business areas based on cross-industry partnerships. In August 2022, the bank opened a stock trading service in alliance with a securities firm, allowing app users to trade stocks without installing a sep- arate mobile trading system. It is also seeking to expand customer touchpoints through constant marketing and service partnerships with major platform players in Korea. Responding to Government Policies and Win-Win Financing Woori Bank conscientiously follows government policies and practices its social re- sponsibility through win-win financial support to the underfinanced. New programs/ products will be launched, such as the Loan Principal Automatic Deduction Program and the Safe Fixed-Rate Special Loan, to help relieve the financial burden of marginal SMEs. Furthermore, the Woori Boss Blooming Savings Plan will offer high interest rates for SOHO owners to assist them in building business funds to more effectively practice win-win cooperation. Woori Bank will continue with practical and consistent financial aid through its special contribution of KRW 68.7 billion to guarantor institutions for In 2022, Woori Bank mobilized a number of bank-wide resources to maintain its status guarantee fee exemption benefits to marginal SOHOs and a special reduction of delin- as a customer-oriented top financial platform company. As a result, its Woori WON quency interest payments for SMEs. Support for ESG Efforts at SMEs In 2023, Woori Bank started business consulting services for SMEs to aid them in es- tablishing a sustainable business environment and ESG management systems. More specifically, the Woori ESG self-check service assists SMEs to quickly diagnose their E (environment), S (social), and G (governance) grades and preparedness level online. Through partnerships with specialized consulting agencies, the bank also supports SMEs with their ESG management introduction and strategy-building via the Woori ESG consulting service. Further to that, new products will be released, including the Woori ESG Practice Partner Company Win-Win Loan, as part of the bank’s participation in the government’s ESG and win-win growth policies. At the same time, the bank will lead the shared growth of large and small businesses as well as ESG management es- tablishment. Banking app drew one step closer to its vision when it achieved 7.32 million monthly active users (MAU), an increase of 1.68 million, or 30%, from the previous year’s 5.64 million MAUs. Woori WON Banking MAU (Unit: thousand users) , 7 3 1 6 , 5 1 9 0 , 5 6 4 5 2020 2021 2022 +1,671(+29.6%) YoY 2023 PLANS Expanding Support to New Growth Industries In 2023, Woori Bank plans to increase its support for new growth industries so as to create future growth drivers from industries displaying high technological prowess and growth potential, and to strengthen its role as a corporate financier. On top of that, the bank is setting up its New Growth Corporate Sales Divisions 1 and 2 as organizations dedicated to discovering new growth companies. This is being done in a bid to induce sales opportunities through hybrid support of investments and finance to new growth companies while promoting network-based direct marketing, such as PE and VC. In ad- dition, the bank will support companies with advanced technology that lack creditwor- thiness through another new product, the Woori New Growth Engine Loan. It will also become the first Korean commercial bank to adopt the Innovation Growth Intelligence System (IGS) to assist branches in their target marketing activities with the data of new growth companies who are benefitting from the government’s policy financing. Reinforcing Asset Quality Management Woori Bank’s COVID-19 Financial Relief Programs, which had deferred both principal and interest payments, came to an end in September 2022. Inevitably, the possible insolvency of some companies is growing, and the delinquency rate has increased due to the three highs—high interest rates, high inflation, and high exchange rates. In response, Woori Bank is stepping up its asset quality management with increased monitoring of borrowers in indus- tries more likely to go insolvent, as well as borrowers who deferred any repayments under the COVID-19 relief program. Any sign (event) of insolvency kicks in immediate organization of response programs at related branch(es) to preemptively deal with the borrowers according to their degree of insolvency (delinquency). The prime goal is to prevent the delinquency from developing into insolvency through individualized soft-landing programs. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTIT Workforce & Expertise Augmentation To enhance its IT capabilities and internalize its IT development capacity, Woori Bank 2023 PLANS A New Tech Standard Framework 036 expanded its existing program of dispatching bankers to the development departments of Woori FIS. The bank recruited 46 volunteers through an internal company-wide re- cruitment process and hired an additional 50 new employees on the condition that they would be dispatched to the development departments of the information technology outsourcing (ITO) affiliate. These personnel are currently involved in IT-related duties. Once their dispatch service concludes, they will be assigned to Woori Bank’s IT/digital planning departments. There, they can apply the development skills they have acquired during their dispatch and develop into versatile talents with expertise in both finance and IT. Furthermore, to enhance their capacity for swift, data-based decision-making and assume a leading role in today’s rapidly changing financial markets, the bank en- sures that its headquarters' workforce participates in data expert training programs. These programs help them maintain the highest level of skills in data collection, analy- sis, and utilization. Work process innovation is also imperative to lead financial markets with speedy and flexible IT development projects. Recognizing this, Woori Bank established a DevOps system within the bank in 2022. Under the bank’s platform department responsible for digital channels, three digital-oriented teams were created: Retail Digital, Corporate Digital, and D&A Platform agile core teams (ACT). Woori FIS's development personnel were invited to join these teams. By applying the Agile development methodology, the ACT teams are highly expected to bring about process innovation that will maximize collaboration efforts between the bank’s business operations and IT functions. Revamping the Woori WON Banking App Woori Bank will concentrate its digital resources on revamping the Woori WON Banking app, the Group’s flagship platform. The new Woori WON Banking app—to be launched in the second half of 2024—will be a financial platform that seamlessly combines finan- cial and non-financial services, including ① personalized finance management (PFM) services, ② essential non-financial services for daily life, and ③ the seamless provision of core services from Group subsidiaries. To that end, Woori Bank will rebuild the plat- form from a customer’s perspective and expand the platform ecosystem through active cross-industry partnerships, including those with education, mobility, and healthcare businesses. The latest next-generation accounts/information system building project in May 2018 did not include non-face-to-face channels, which means it is now using an outdated framework. While a future advanced development environment will be laid out so that it can be quickly developed (after careful reflection on the various requirements from the field), the channel architecture will be standardized to ensure efficiency and con- sistency in the development outcomes. A new independent operation/management team will also be created to internalize the core IT technology of the rebuilt framework. Additionally, the team will be assigned with roles that shoulder the responsibility for the source technology and common functions, thereby preventing any wasted resources from overlapping in development tasks among individual business development teams, while also securing its internal IT development capabilities. Innovative Technology from a Digital Banking Leader Woori Bank continues to march forward with its digital innovation, which is driven by cutting-edge technology. In February 2022, the bank developed a blockchain platform as the foundation for innovative blockchain services. Additionally, in June 2022, the bank implemented a real-time system for personalized marketing, further establishing its innovative technology base. In 2023, the bank plans to ① develop an AI banker based on generative AI technology through a collaboration with a specialized AI re- search institute and ② establish a customer data platform to lay the foundation for ultra-personalized services. Upon completion, the customer data platform will enable real-time analysis of all customer behavior data on each of Woori Bank’s channels, from branches and customer centers to its mobile banking app, allowing the bank to offer more sophisticated and customized financial services. Woori Bank's digital strategy also includes plans to implement My Personal Financial Assistant, a service that offers business affairs processing and financial counseling anytime and anywhere. Through the upcoming digital universal banking system and integration of cutting-edge technology, Woori Bank will become a leading digital bank Global ACT Team to Support Global IT Initiatives The support provided by Woori FIS to its international subsidiaries is limited to the boundaries defined in the Information Technology Outsourcing (ITO) contracts. This ar- rangement can inevitably lead to gaps in comprehensive IT assistance across the bank, as it would infringe on the principle of equitable transactions if IT support is extended to any group subsidiary not included in the ITO contracts. This concern can be mitigated by the formation of a worldwide Advanced Customer Technology (ACT) team, where Woori FIS staff would serve simultaneously in banking business functions. In this setup, the support would not be seen as IT assistance, but rather as a banking upkeep service. In particular, the international subsidiaries are currently the entities requiring the bank's sophisticated IT framework the most. Proactive involvement by a global ACT team could address this concern by taking a proactive stance on potential IT risks. This would subsequently strengthen the self-maintenance abilities of international subsidiaries while ensuring the stable operation of the IT infrastructure. that offers an unrivaled customer experience. Advancement of IT Quality Control To meet the growing demand for various developments, the bank plans to adopt an IT testing model that aligns with global standards. Also, to secure systematic and ad- vanced testing capabilities, it will establish a system that detects signs of abnormality in advance and a monitoring environment without any blind spots. By combining a global standard IT testing model, the bank will establish an advanced quality control system that meets international certifications. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT037 IB & Asset Management 2022 ACHIEVEMENTS Stable Liquidity Management Enhancing Foreign Exchange and Derivatives Business Competitiveness By bolstering sales of core derivative products, particularly interest rate swaps, Woori Bank ensures that customers receive uniquely tailored funding solutions that align with the prevailing interest rate hikes in major economies. On top of that, Woori Bank is con- sistently expanding its scope of derivatives trading by engaging in bond forward sales In 2022, Woori Bank sustained robust liquidity ratios, surpassing the Korean regulatory to insurance companies, effectively adapting to ever-evolving global market dynamics benchmarks across key metrics, namely its loan-to-deposit ratio (LDR: below 100%), and adeptly managing risks at an optimal level. liquidity coverage ratio (LCR: minimum 92.5%), foreign currency LCR (minimum 80%), net stable funding ratio (NSFR: minimum 100%), and mid- and long-term foreign cur- rency funding ratio (minimum 100%). Moreover, Woori Bank actively engaged in preemptive funding strategies and inves- tor relations initiatives, successfully securing investments from many distinguished stakeholders. Notably, the bank issued subordinated bonds totaling KRW 400 billion (at a rate of 4.46%) in July and hybrid bonds amounting to KRW 350 billion (KRW 320 billion at a rate of 5.20% and the remaining KRW 30 billion at a rate of 5.45%) in Sep- tember, fortifying its operational stability and foundation for sustained success. F/X Dealing Division•In the F/X Dealing Division, Woori Bank demonstrated a pro- active and agile approach in navigating the fluctuations witnessed in both domestic and international foreign exchange markets through in-depth market analysis. Notably, Woori Bank's robust presence as a market maker enabled it to achieve a commendable market share in the Seoul foreign exchange market in 2022, with USD/KRW and CNY/ KRW market shares standing at 6.3% and 11.5%, respectively. Derivatives Division•In the Derivatives Division, the bank works tirelessly to manage its positions by proactively responding to various market variables, including exchange Furthermore, Woori Bank strategically capitalized on the burgeoning demand for en- rates, interest rate fluctuations, and liquidity trends. Through this proactive approach, vironmentally conscious and socially responsible investments and issued sustainable Woori Bank established a secure foundation for its derivative trading activities. Also, the bonds amounting to KRW 400 billion in Korean won and USD 500 million in foreign bank caters to the needs of SME customers who may lack expertise in risk manage- currency. This proactive step not only contributed to enhancing the bank's corporate ment. Through comprehensive foreign exchange and interest rate risk management image by driving the bank’s tangible social impact but also facilitated cost reduction in consulting services, Woori Bank offers tailored and optimized solutions that address the the realm of funding, rendering it a prudent financial decision. unique requirements of each individual client. LCR (Liquidity Coverage Ratio) (Unit: %) Securities Division•Woori Bank's Securities Division is an integral component of its overall strategy, generating stable interest income by adopting a proactive stance in response to domestic and international interest rate hikes. To diversify its revenue 143.1 streams, Woori Bank has established a dedicated beneficiary certificate management Strengthening IB Market Dominance and Innovative Venture Investment (CIB Business Division) In 2022, Woori Bank's IB Group fortified its financial arrangements for M&A acquisition finance and power plants/infrastructure/real estate project financing. Through astute fi- nancial orchestration and active principal investments, the bank successfully amplified its non-interest income, while also broadening its global presence through the prolifera- tion of its global IB desks. By leveraging its competitive edge in the fiercely competitive M&A and equity investment markets, Woori Bank's IB Group was particularly deft at navigating challenging market conditions, as well as securing commendable levels of operating income and non-interest profits. Distinguished as the clear leader among do- mestic banks, Woori Bank operates an impressive network of seven prominent global IB desks, continually propelling its global IB assets and profit growth to new heights. Foreign Currency 109.5 107.3 Liquidity Coverage Ratio 93.2 93.2 110.0 97.2 102.4 22.1Q 22.2Q 22.3Q 22.4Q team and fully commenced its business operations. Additionally, the bank underscores As of 2022, Woori Bank had strategically established and was diligently operating its commitment to corporate social responsibility by actively investing in ESG bonds, global IB desks in influential financial hubs that included New York, London, Germany, thereby heightening its reputation as a socially responsible financial institution. Singapore, Sydney, Vietnam, and Dubai. By drawing on its extensive global network, the bank consistently generates substantial IB business opportunities across international borders. Building upon this robust foundation, the IB Group achieved a remarkable mile- stone in 2022, with operating-related revenue surpassing KRW 316 billion. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTIn addition to its global reach, Woori Bank augmented its portfolio with superior invest- Delivering Competitive Investment Products 2023 PLANS 038 ments through strategic collaborations with top-tier global asset management firms. Also, the bank actively engaged in aircraft financing, overseas infrastructure and devel- opment projects, and the expansion of structured finance offerings. At the same time, the establishment of real estate PF loan funds and the issuance of floating rate notes (FRNs) via its Hong Kong IB subsidiary reinforced both short-term profitability and the pursuit of forward-looking investments in prospective growth avenues. global market volatility, unveiling a comprehensive array of investment offerings. This encompassed a diverse range of 56 domestic and international mutual funds, as well as 13 exchange-traded funds (ETFs). Anchoring its operations around 289 flagship funds (as of December 2022), the bank fastidiously managed client assets. Specifically, Woori Bank prioritized greater stability throughout the year while also satisfying the augment- Moreover, Woori Bank remained at the forefront of fostering innovation-driven financial ed demand for customer-centric products. It achieved this objective by introducing trust ecosystems and propelling the growth of pioneering enterprises. products, such as equity-linked trusts (ELTs), which featured secure revenue structures Since its inception at the end of 2018, the bank's groundbreaking Innovation Venture and diversified underlying assets, thus optimizing the interests of its clientele. In 2023, the Funding Market Group is working hard to stay focused on effectively man- aging key liquidity indicators, including LDR, LCR, and NSFR, to navigate the heightened volatility of the global financial landscape. By adopting a proactive approach to liquidity management, the group aims to minimize the impact of funding volatility and strategi- cally prepare for the eventual conclusion of financial regulatory easing. On top of that, the group is committed to reinforcing stability by augmenting retail deposits and issuing marketable certificates of deposit (CDs) to shore up pre-emptive liquidity measures. In addition, it is actively securing committed lines of credit to ensure a consistent flow of In 2022, Woori Bank proactively adjusted its product lineup in response to amplified Proactive Liquidity Management for Greater Stability Finance team has continued to spearhead investments in cutting-edge companies, In the domain of bancassurance, Woori Bank responded adeptly to the need for yield funding. The group is also strengthening funding and portfolio management capabilities enhancing the government's ambitious vision for innovation-led growth. Remarkably, preservation during interest rate upswings by promptly launching fixed-rate products to optimize profitability. through ten highly successful rounds of public offerings, Woori Bank has executed a to- and augmenting its portfolio. In particular, it catered to customer needs by boosting the tal of 90 direct investments in transformative, forward-thinking enterprises, showcasing competitiveness of its guaranteed investment options. In the Trading Division, the group is well attuned to the evolving dynamics of the global market environment and is poised to pursue stable foreign exchange and derivatives its unwavering commitment to shaping the future of finance. Total Assets of Investment Banking Operations in 2022 (Unit: KRW trillion) Through the leveraging of its digital channels, Woori Bank expanded the scope of in- operations. By strengthening its digital prowess in FX trading and expanding the client vestment strategy reports available within its online banking platform, WON Banking. base in foreign exchange and derivatives, it is striving to establish a resilient business Encompassing four distinct types of reports, these offerings aimed to furnish customers environment that fosters sustainable growth and amplifies non-interest income. with regular and insightful investment information. Furthermore, the bank introduced a subscription feature, ensuring consistent access to valuable market insights. By rein- forcing its non-face-to-face trust services, including the bolstering of dedicated video conferencing personnel, Woori Bank sought to amplify customer accessibility. Simulta- neously, it revitalized its non-face-to-face bancassurance products, aligning them with evolving market demands. In the Securities Management Division, thorough market analysis is drawn upon to swiftly adapt to domestic and international market conditions, thereby generating stable returns. The group's forward-looking risk management practices are geared towards establishing a robust foundation for sustainable profitability. Through the continuous diversification of managed assets, which encompasses beneficiary certificates and exchange-traded and OTC derivatives, the group also aims to expand its non-interest As part of its commitment to consumer protection and the eradication of misselling income streams, increasing its overall financial performance. practices, Woori Bank effectively refined its AI-driven call recording system, which significantly contributed to mitigating instances of misselling practices and upholding regulatory compliance. Additionally, the bank expanded its non-face-to-face fund trading hours, enabling round-the-clock transactions. In short, Woori Bank consistently pursued process innovations, streamlining investor risk profiling procedures and imple- menting automated form completion for fund subscriptions, culminating in an enriched customer experience. * Data from Korea Financial Investment Association e-Disclosure Service (as of Dec. 31, 2022, based on 14 trust companies) 2022Ratio (%)Total Assets23.2100Balance Sheet Assets15.566.8Loans8.034.7Securities7.431.9Others0.00.2Off-balance Sheet Assets7.733.2Loans and Securities Commitments7.231.2Payment Guarantees0.31.3Others0.10.6STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTMaximizing Group-wide Synergies to Strengthen the Investment Banking Division In 2023, the Investment Banking (IB) Group is poised to embark on a transformative Security 2022 ACHIEVEMENTS 2023 PLANS journey, playing a pivotal role in Woori Financial Group’s synergies. Advanced Persistent Threat (APT) Response System Upgrade Document-Embedded Malware Detection System With a resolute focus on establishing an enduring foundation for long-term profitability, Woori Bank has built and operates an APT detection solution to prepare for potential infiltra- Woori Bank’s APT Response System effectively detects and blocks newly patterned mal- the group's strategic business objectives revolve around the core tenets of efficient tion of malicious code. It uses an E-mail APT to detect and block malicious emails and at- ware that cannot be detected by vaccines. However, there is the possibility that non-ex- capital management and robust revenue base construction. This entails a concerted tachments that are spread through emails, with a File APT activated to detect and block ma- ecutable document files, including MS Office, Hangul, PDF, and other such software, can effort to expand the portfolio of premier loan assets, sharpen financial arrangement licious codes when files are transferred from external sources to the bank’s intranet. Starting bypass behavior-based analysis of the system, with the Document File Malware Detec- capabilities, and amplify collaboration and cooperation across group affiliates in CIB in 2022, the bank is further enhancing its APT responsiveness so that it can more precisely tion program able to close that loophole by identifying the vulnerabilities of non-execut- operations. block any detected malicious codes by using dynamic analysis and behavior analysis. able document files by using reverse engineering and multi-scanning technologies. Woori 039 Cloud International Security Standard ISO 27017 Woori Bank became the first Korean financial institution to obtain the international standard security certification (BS7799) for its internet banking service. It is also the first Korean bank to obtain the country’s national information protection certification, the Information Security Management System (ISMS). With the rising demand for protecting personal information, Woori Bank became the first bank in the financial sector to obtain both international (ISO 27701) and national certifications (ISMS-P) for its privacy information management system. In 2022, it was also the first Korean bank to obtain international standard certification for cloud service information protection (ISO 27017). As such, the bank is leading by example when it comes to meeting domestic and international standards of information security, while at the same time paving the way for the industry’s customer information protection and information security management systems to be elevated to an even higher level. Bank plans to eradicate the blind spots susceptible to malware attacks through multiple defenses that involve the frontline’s vaccine software, APT response system on the sec- ondary line, and Document Malware Detection System on the final line of defense. Public Cloud Security Standards In the second phase of its cloud advancement plan, the Group-wide cloud operation will expand as public, hybrid, and other cloud operating models, such as Software as a Service (SaaS). In 2023, the bank will preemptively establish its security standards for public clouds to prepare for cloud expansion. Going forward, Woori Bank will set up cloud service information security guidelines, reflect key content regarding supervisory regulations in internal regulations, and create a security zone. This will all be carried out to centralize the account administration, access control, security control, and more in order to prepare for multi-cloud usage environments, building an integrated security environment between the data center and the cloud. In an era marked by escalating global capital market volatility, the group recognizes the critical need to carry out meticulous risk management and shore up internal control systems. By prioritizing these crucial aspects, it increases resilience and proactively paves the way for sustainable growth, thus positioning itself as a stalwart in the face of market uncertainties. Lastly, the group fervently seeks to augment CIB competencies by fostering seamless collaboration among diverse subsidiaries, encompassing investment bank/capital/ asset management/venture capital in consistent pursuit of synergies. At the same time, it remains steadfast in its quest for maximum synergy realization by exploring avenues for potential integration of additional financial subsidiaries in the Group down the road, such as securities and insurance. Securing Persistent Competitiveness in Investment Product Sales Woori Bank's Investment Products Strategy Group is committed to establishing a re- silient business foundation through a customer-centric sales support system, moving beyond individual product sales. Its aim is to facilitate a progressive transition towards a sustainable asset management framework. Moreover, the group will introduce well-de- fined asset allocation proportions and product offerings tailored to diverse customer segments, implementing rigorous processes to ensure the stable and efficient man- agement of customer assets. To achieve this, it will hone the expertise of its investment product-focused headquarters and sales personnel, while bolstering its platforms and digital capabilities to solidify its sustainability competitive edge. Additionally, the group will intensify its monitoring efforts pertaining to investment product launches, simul- taneously enhancing internal control processes through the integration of automated workflows. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT040 Furthermore, Woori Bank has taken significant steps towards process innovation with the While reinforcing its product competitiveness with advanced product lineups, Woori Bank full integration of the online data submission (ODS) system for mortgage originators, in- also promoted its signature brand, Woori Parental Love Trust Service, which offers total creasing customer convenience in the process. The bank's commitment to digitalization wealth management services through trusts, in a bid to reach as many new customers as was exemplified by the fact that it was the first Korean bank to perform the government's possible. The promotional campaign also paved the way for providing total care services for 3rd Secure Conversion Loan program online, thus reinforcing its position as a leader in the customer assets. digital banking arena. 2023 PLANS 2023 STRATEGIES In 2023, Woori Bank’s Trust Department plans to lead the market with a business model With the Real Estate Financial Group's notable achievements in digital banking opera- that can continuously satisfy the needs of customers for asset management in response tions over the past year, the focus for 2023 is on the complete digitization of real estate to the rapidly changing market environments. In particular, the trust business will drive finance. This strategic move involves enabling customers to conveniently apply for and the bank’s non-interest income on the back of steadily growing sales of special money manage both the bank's real estate financial products and NHUF offerings through online trust products. On top of that, the department will offer various new products and diversify channels. The group is also diligently constructing a user-friendly digital infrastructure to product lineups corresponding to changing market environments, while also suggesting strengthen customer value and satisfaction. customer-oriented portfolio investment strategies to help play a leading role in the man- At the same time, Woori Bank remains in step with all related government policies and is agement of customers’ valuable assets. actively implementing environmental, social, and governance (ESG) initiatives. As part of Furthermore, the Trust Department will upgrade the contracts and services of its total an industry-wide effort to address the pressing issue of fraudulent housing lease con- wealth trusts to expand the scope of its coverage into wealth management and inter-gen- tracts, the bank is also participating in the refinancing of loans for victims of this fraud. erational wealth transfer, as well as the basic function of asset building. This will allow us Additionally, it provides support for relocation deposits to assist individuals residing in to build long-term partnerships with customers and their offspring, providing stable com- irregular housing, allowing the bank to contribute to housing stability for low-income indi- plex financial services based on these trust accounts. viduals. Going forward, the Real Estate Finance Business Group will continue to be a lead- er by offering products and services that address pertinent social issues as a committed partner in supporting the government's policies. Certifications and Awards Oct. 2022 Woori Parental Love Trust Service won the Excellence Award at the 11th Centenarian Era Finance Awards* * The Centenarian Era Finance Awards reviews and awards financial products for retirement planning, and is co-organized by Money Today Network and the Korean Academy of Financial Consumers, and sponsored by the Financial Services Commission and the Financial Supervisory Service Real Estate 2022 ACHIEVEMENTS In 2022, Woori Bank's Real Estate Finance Business Group performed remarkably by secur- ing the second position in domestic mortgage loans while maintaining its predominant top spot in the National Housing and Urban Fund (NHUF) market share. This accomplishment not only aligns with the bank's commitment to supporting the government's policy financ- ing drive but also underscores its pivotal role in ensuring stability with respect to the housing needs of customers. Moreover, Woori Bank has consistently demonstrated its proactive ap- proach in adapting to market dynamics, thereby emerging as a frontrunner in the domestic real estate financial market. Trust & Pension Having served as the entrusted bank for the NHUF for over 14 years, Woori Bank has gar- nered widespread recognition for its operational excellence, solidifying its reputation as a 2022 ACHIEVEMENTS leading provider of various real estate financial products. This was further substantiated in In dealing with the volatile market environment in 2022, Woori Bank introduced new prod- 2021, when the bank achieved the highest performance evaluation by the government in ucts focused on the stable management of customer assets. The bank flexibly adapted to the NHUF treasury bank category for the third consecutive year. the rapidly changing financial environment by widening the low-barrier mechanism of eq- In addition to its product offerings, the Real Estate Finance Business Group has remained dedicated to enhancing the customer experience by embracing changes in the financial landscape. One noteworthy initiative was the launch of the comprehensive real estate platform WONTHELAND. This innovative platform amalgamates real estate and financial product information, offering users a convenient and streamlined avenue to access relevant resources, making it a trailblazer in the real estate financial market. uity-linked (ELT) products and offering portfolios for installment/diversified investments. In addition, Trust Product Team 2 was created after a reorganization and is now fully dedicated to fixed-income investments. The team not only provided personalized products custom- ized to individual needs but also regularly released new products, such as derivatives-linked bonds (DLB) and hybrid bonds, thereby contributing to popularizing fixed-income trust products. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Woori Card www.wooricard.com Woori Card was established following its spin-off from Woori Bank in April 2013 to strengthen the Group’s credit card operations as well 2022 ACHIEVEMENTS Transaction Value (Unit: KRW billion) 041 Woori Card has experienced constant growth in its credit card transaction volume thanks to the increased number of memberships, affiliate marketing with Woori Bank, and its active entry into the digital payment market. At the same time, the company continuously grows its financial assets (long-term credit card loans) with its prime cus- tomer base. Additionally, it has been engaged in installment payment, lease, and credit loan businesses since 2016 as it continues to expand its long-term revenue base. In 2022, Woori Card's total assets grew by KRW 2 trillion from the previous year due to an increase in revenue-generating financial assets and the expansion of its auto finance busi- , 8 5 0 3 6 7 . , 9 2 8 5 0 1 . , 9 8 2 4 5 5 . YoY +5.8% as the competitiveness of its non-bank sector. Taking full advantage ness. Despite the post-pandemic unfavorable business environment, which resulted from of being a subsidiary of a financial group, Woori Card has devised sagging consumption and falling merchant fee rates, Woori Card worked hard to achieve 2020 2021 2022 the optimal business strategies based on the extensive network and customer base of Woori Bank, and is now actively exploring new business opportunities in pursuit of future growth drivers. Customer value is the overarching priority in all its business activities as the company constantly develops products and services to meet cus- tomer needs. Indeed, it is currently expanding its business through signature product lineups and cross-selling with peer subsidiaries, stable growth in its financial assets and improve the delinquency rate through active risk management. As a result, the company achieved a net profit of KRW 204.4 billion in 2022. Woori Card proactively and systematically adapts to the changing business environ- ment by developing distinctive products and enhancing its competitiveness through cross-selling with Group subsidiaries and strengthening its digital/global capabilities. Furthermore, it is preparing itself for the entry of big tech firms into the payment market with its own settlement platform, Woori Pay, which will enhance the company's digital platform capabilities. The company also quickly adapted to the fast-changing data while also reinforcing its digital and global capabilities. platform market by launching its MyData Service soon after obtaining a service license. Additionally, Woori Card launched a local subsidiary called Woori Finance Indonesia in September 2022 to broaden its global reach in Southeast Asian markets. Operating Revenue (Unit: KRW billion) , 1 3 8 7 5 . , 1 5 2 8 7 . , 1 8 3 6 8 . YoY +20.2% 2020 2021 2022 Net Profit (Unit: KRW billion) 2 0 0 7 . 2 0 4 4 . 1 2 0 2 . 2020 2021 2022 Note) 2022 net income attributable to controlling interest YoY +1.8% STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT042 2023 PLANS In 2022, the lifting of pandemic social distancing restrictions allowed daily life to return to some sense of normalcy, leading to consumption picking up quickly in the private sector. This also boosted the overall credit card transaction value by 12.3% from the previous year to KRW 1,097.7 trillion. Although credit sales are expected to continue Certifications and Awards Dec. 20. 2022 Grand prize winner in the financial sector at the 2022 Web i-Awards increasing in 2023, rising interest rates and the resultant higher consumer prices are Oct. 26. 2022 First anniversary ceremony of the Korea Platform & forecast to undermine the credit sales growth trend. Furthermore, the global economic Freelancer Workers’ Mutual-Aid Foundation slowdown and the triple-highs of interest/FX rates and inflation are expected to push up funding costs and credit loss costs, which will only add more acute pressure on the credit card business than the previous year. In dealing with this situation, Woori Card is preparing several countermeasures. While readying itself against an unstable economic environment by diversifying its funding sources in addition to preemptive risk management, the company is seeking new Aug. 4. 2022 Grand prize winner in the credit card category at the JoongAng DailyS' 2022 Customer Reliability No. 1 Pre- mium Brand Awards July 26. 2022 Grand Prize winner in the service innovation category at the 2022 Social i-Awards growth momentum by differentiating its customer-oriented platform content and ex- July 22. 2022 Winner of the environmental ESG Award at the Dong-A panding into new business portfolios. Ilbo’s 2022 K-ESG Management Awards For this purpose, improving profitability will be at the top of the priority list. Woori Card will Apr. 20. 2022 Best award winner in the credit card category at Money S’s 2022 Korea Leading Finance ESG Awards achieve its goal through rigorous profit management of each business sector and efficient cost management. The company will also reinforce its data analysis and marketing capa- bilities to increase profitable assets, mainly with prime members, and readjust new mem- ber recruitment portfolios and the business expense structure. The resultant efficiency in company-wide business operations is expected to contribute to cost savings. In coping with the fast-evolving digital market, Woori Card is leveraging its big data model-based personalized marketing integration platform to enhance its marketing effi- ciency. As the company is developing a consumption prediction model that applies dif- ferent strategies to customers at each stage of their lives, target marketing will become more sophisticated in order to increase the card’s usage share within each customer’s wallet. In search of new growth drivers, the company is also more aggressively pursuing the auto installment finance market and diversifying into new business areas, while also expanding its business in Myanmar and Indonesia to reinforce its differentiated global competitiveness. Woori Card Net Profit (As of the end of 2022) Woori Card Transaction Value (As of the end of 2022) KRW 204.4 billion KRW 98,245.5 billion STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT043 Woori Financial Capital www.woorifcapital.com 2022 ACHIEVEMENTS Net Income (Unit: KRW million) Korea’s credit finance industry is facing limited growth and inten- Woori Financial Capital set up a company-wide decision-making body and imple- sifying competition in the auto finance market, which demands mented 27 digital transformation projects to establish an integrated digital governance exploring new sources of revenue while also keeping up with the system in 2022. In order to expedite its growth, the company diversified sales channels new trend of contactless marketing and growing digital finance competition. In response to these challenges, Woori Financial Capi- tal has designated its management goal as "Rising to Crisis, Reboot 2023." To realize this ambition, the company has outlined four key strategies aimed at facilitating qualitative growth and bolstering its revenue base, thus paving the way for sustainable future growth. Certifications and Awards Woori WON Car won the 2022 Korea Consumers Awards (auto financing sector) Woori Financial Capital’s Financial Performance (Unit: KRW million, %p) by expanding partnerships with imported car dealers, prestige fleets, and used car mar- kets while broadening its commercial non-captive market operations. To secure sus- tainable growth drivers, the company also established a CVC fund GP (general partner) organization and launched a number of funds, increased partnerships with electric car companies, upgraded its computer system, and reduced the lead time for loans. As a result, the company’s total assets on a consolidated basis reached KRW 12.6 trillion at the end of 2022, an increase of 23% from the previous year, with net income increasing by roughly 30% year on year to KRW 183.3 billion. 2023 PLANS Woori Financial Capital plans to build a sustainable growth path based on four manage- ment strategies. First, it will increase the core competitiveness of its main businesses. To this end, the company plans to consolidate the partnerships in its core businesses and expand the scope of the automation process while seizing upon Group synergies. Second, the company will secure new growth engines by strengthening its value chain and strategic investments in CVCs while entering into the green mobility and consumer finance markets. Third, the company will enhance its digital leadership. Thus, it will expand the digital process, build a platform-based one-stop financial service, bolster the self-reliance of the Woori WON Car platform, adopt the public MyData service, and enter the plat- 1 8 3 3 2 8 , 1 4 0 5 7 9 , , 5 8 9 8 0 2020 2021 2022 +42,749(+30.4%) YoY Social Contribution Activities Donations to Support Monsoon Damage Recovery •Purpose: Cash donations to support victims of the monsoons in August 2022 (as part of our ESG-related social contribution activities) •Total donation amount: KRW 90 million •Recipient: Hope Bridge National Disaster Relief Association COVID-19 Relief Finance •Deferrals on the principal and interest for SOHOs affected by the pandemic •Total amount: KRW 153,826 million (as of Dec. 2022) form-based new market and loan rollover business market. * Based on the principal amount (not including re-deferrals) Lastly, the company will heighten its internal management capabilities. To accomplish this, it will apply company-wide integrated risk management, strengthen gatekeeping and post-management, establish an innovative corporate culture, improve operational efficiency and productivity, and heighten its internal controls. 202020212022YoY ChangeTotal Assets8,880,11710,259,86812,581,473+2,321,605Net Income58,980140,579183,328+42,749NPL Ratio(%)1.771.201.22+0.02ROA(%)1.531.691.51-0.18ROE(%)13.8315.7412.53-3.21STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTWoori Investment Bank www.wooriib.com Woori Investment Bank provides 'One-Stop' total financial services Woori Investment has been striving to branch out with its IB operations so as to diver- Woori Investment Bank is laying the foundation for sustainable growth as a competitive including investment banking and commercial banking services. sify its revenue sources. In April 2022, the company set up a Project Finance Division non-banking subsidiary of Woori Financial Group. 2022 ACHIEVEMENTS 2023 PLANS 044 The bank's services include deposits, loans, foreign exchange, letter of credit, lease finance, securities dealing, and Investment banking services. The bank has been strengthening its investment banking operations, such as corporate and real estate finance to expand the proportion of non-interest incomes. Additionally, Woori Investment Bank continues to diversify its revenue streams by leveraging synergies within the Group, through initiatives like joint corporate and investment banking (CIB) investments and cross-selling loan due to its capital increase in 2022 and its stable funding through deposit-taking and products. liquidity responsiveness. from A0 (positive) to A+ (stable) by Korea Ratings and Korea Investors Service in 2022. This was the result of the company’s improved earning power on the back of increased operating assets and business diversification, as well as improved capital adequacy as a dedicated team to reinforce IB profits and strengthen marketing on developers and builders while also making efforts to diversify its revenue sources into securities investments. As a result, its IB fee income reached a record-high KRW 70.9 billion, an increase of 47% from the previous year, in 2022. In 2023, the company set its goal at sustainable growth to become a robust investment bank. To attain that goal, the company laid out four management strategies to focus on with respect to its qualitative growth and risk management of its core businesses: strengthening its core business, generating future revenue sources, making risk man- On top of that, Woori Investment Bank’s corporate bond credit ratings were upgraded agement and internal control a top priority, and enhancing management efficiency. To this end, the company will expand its quality assets and revenue sources by height- ening its corporate finance competencies while also pursuing new opportunities to generate fee income, such as market sales. At the same time, the company is working hard to maintain its asset soundness and liquidity through proactive risk management. For instance, it is building a monitoring system that increases on-site due diligence with project financing as it also develops systematic risk management through ALM risk management and monitoring. IB Fee Income (Unit: KRW billion) Net income (Unit: KRW billion) 7 0 9 . 4 8 2 . 3 3 1 . 9 1 8 . 7 9 9 . 6 2 9 . +22.7(+47.1%) YoY +11.9(+14.9%) YoY 2020 2021 2022 2020 2021 2022 STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT045 Maximizing Group Synergies•Woori Asset Trust will tap into its inter-affiliate syner- gies in pursuit of greater business opportunities and a stronger revenue base by con- ducting joint marketing through the Group network and joint development of Group- owned real estate. Selective Increase of Core Products•In consideration of relevant market develop- ments, the company will opt to diversify its business portfolio on selective order proj- Woori Asset Trust www.wooriat.com In 2022, Woori Asset Trust delivered outstanding financial In 2022, Woori Asset Trust achieved historic-high performance results, with trust de- performance underpinned by its industry-leading risk management posits exceeding KRW 51 trillion and generating an operating profit of KRW 80.7 billion. 2022 ACHIEVEMENTS system. The company is also securing competitiveness in new business areas, such as REITs, policy projects, and innovative financial services. Financial Performance (Unit: KRW billion, %) Its successful bids for the first and second land development REITs and logistics REITs marked its successful entry into the REITs market, along with the successful issuance of innovative real estate digital securities. Its competitiveness was also reinforced in new business areas when it expanded orders for urban redevelopment projects in step ects, mainly in profitable projects with secured business feasibility and marketability, with government-led projects. At the same time, the company bolstered its internal controls and risk management system in preparation for a potential real estate market crisis. In fact, company-wide in- novation took place not only to increase on-site monitoring but also to implement a task force for proactive innovation of the internal control process. As a result, new contracts reached KRW 112.5 billion, with an operating profit of KRW 80.7 billion (up 44.6% YoY) and a net income of KRW 60.3 billion (up 49.7% YoY). ROE and ROA stood at 30.5% and 20.9%, respectively, putting the company at an indus- rather than just aggressively taking orders. Taking off as a Late Starter•Woori Asset Trust will widen its pool of investor networks to ensure competitiveness in the fluctuating REITs market. Thus, it plans on continuing to expand the land compensation REITS and public-support private rental housing RE- ITs, while also promoting large-scale office REITs. IT Corporate Culture Innovation•The company is presently wrapping up the second phase of its operational system upgrade project, which will enhance user convenience and facilitate downtime-free/error-free services to promote work efficiency. try-top level of efficiency. 2023 PLANS Key Financial Indicators by Trust Company (Unit: %) Woori Asset Trust put forth the following six business strategies to attain its goal for 2023 of achieving sustainable growth while maintaining an effective balance between Total Equity (Unit: KRW billion) risk and return. 2 2 7 5 . 1 6 8 4 . 1 2 9 2 . +59.1(+35.1%) YoY Zero Risks and Accidents•A dim outlook on the real estate market has given rise to the need for tighter risk control. Accordingly, the company will keep up with its real-time monitoring of each risk factor while increasing the frequency of on-site project moni- toring and strengthening daily audit functions to achieve an exhaustive internal control system. Finding Niche Markets•The company will also unearth NPL properties that will be set to emerge from a falling real estate market and actively cash in on public auctions and disposal trusts on these properties. It will also diversify its revenue stream by continuing 2020 2021 2022 to list innovative financial products, such as digital asset securities, and make PFV in- * Data from Korea Financial Investment Association e-Disclosure Service (as of Dec. 31, 2022, based vestments in promising businesses. on 14 trust companies) ROEROANCRWoori Asset Trust30.520.91,190KB Real Estate Trust17.313.3912Hana Asset Trust18.715.7856Shinhan Asset Trust25.618.21,108Korea Asset Investment Trust9.47.7511Korea Real Estate Investment and Trust4.82.8341Daehan Real Estate Trust9.16.21,105KORAMCO REITs and Trust16.811.3679Mugunghwa Trust15.58.8473Korea Trust1813.8946Kyobo Asset Trust9.27.71,039Shinyoung Real Estate Trust17.1141,446Daeshin Asset Trust5.14.61,401Korea Investment Real Estate Trust8.27.71,76620212022YoYNet Operating Revenue92.7132.7+40.0 (43.2%)Operating Profit55.880.7+24.9 (44.6%)Net Income40.360.3+20.0 (49.7%)Total Equity168.4227.5+59.1 (35.1%)STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTWoori Savings Bank 046 www.woorisavingsbank.com As a financial institution catering to the general public and small- to-medium-sized enterprises, Woori Savings Bank focuses on enhancing financial convenience and boosting savings through its core services such as deposits and loans. The bank joined Woori Financial Group in March 2021. Since then, it has been striving On top of that, the bank completed an integrated digital banking platform for both de- Total Assets (consolidated) (Unit: KRW billion) posit-taking and lending in July 2022 that was the result of its digital innovation drive to secure digital competencies and a stronger future growth foundation. In the latter half of 2022, the bank expanded its non-face-to-face transactions and secured 4,652 new accounts in digital deposit-taking. to solidify its position as a leading savings bank in Korea through 2023 PLANS robust growth in both scope and capacity. 2022 ACHIEVEMENTS In 2022, Woori Savings Bank concentrated on stable asset growth in retail credit loans and on expanding its sound corporate loans. To that end, the bank strategically bol- stered credit loan product lineups on digital channels that are based on an advanced CSS model and diversified its sales channels through partnerships with innovative channels. Despite the deteriorating economic conditions due to unstable financial mar- Amid the expected tightening of regulations in the near future by financial supervisory authorities, the ongoing deterioration of market conditions, and the intensifying digital drive competition, Woori Savings Bank will remain focused on its substantial manage- ment and strengthen its foundation for future growth. To begin, the bank will upgrade its risk management system so that it can preemptively respond to potential crises. While advancing its retail credit evaluation model, it will step up its monitoring of corpo- rate borrowers who face potential insolvency. In addition to the preemptive monitoring of vulnerable groups and tightened responsiveness systems, the bank will focus on its preemptive management of risks by applying stricter standards to large exposures and kets, the bank strategically adjusted its portfolio and selectively marketed, mainly, qual- real estate project finance. , 1 7 8 6 5 . , 1 4 4 4 5 . , 1 1 9 1 4 . YoY +342.0 2020 2021 2022 Total Loans (consolidated) (Unit: KRW billion) , 1 2 5 5 1 . , 1 0 2 6 4 . , 1 4 7 2 5 . YoY +217.4 ity loans. As a result, its total loan balance grew by KRW 217.4 billion from the previous While continuing to broaden support for the policies towards the general public and year, with KRW 15.6 billion in year-on-year growth of net interest income—and all in the SMEs, the bank will also strive to improve profits through future revenue-driven selec- 2020 2021 2022 midst of the higher interest expenses arising from every base rate hike. At the same time, Woori Savings Bank tightened up its risk management system for retail and corporate clients by upgrading its fraudulent loan prevention system and setting up a tive asset growth based on a tighter risk management system. Retail credit loans and corporate loans are subject to our intensive monitoring in order to increase performing assets concentrated on high-credit borrowers. Group-shared corporate credit rating system. As a result of its preemptive risk management Moreover, Woori Savings Bank plans to integrate its distributed digital channels to build measures, the bank’s NPL ratio (3.2%) was lower than the industry average (4.1%) at the an integrated administration system that will give it the ability to move to a self-man- end of 2022, indicating its stable asset management was above the industry average. agement system. By doing this, the bank expects that it will ultimately enhance cus- As a financial institution promoting financial inclusion, Woori Savings Bank extended support by providing KRW 301.2 billion in policy financial products to individuals with limited access to traditional banking services. Moreover, the bank facilitated KRW 137.0 tomer accessibility and security, while the electronic form-based digital platform is ex- pected to further customer convenience. Also, the bank will develop a next-generation integrated lending system to expedite its digital transformation and solidify its financial billion in mid-rate retail credit loans, contributing to the financial empowerment of indi- service platform. viduals seeking responsible credit options. NPL Ratio (separate) (Unit: %) 3 4 . 3 2 . 2 3 . 2020 2021 2022 YoY +0.9%p STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT047 Woori Financial F&I www.woorifni.co.kr Woori Financial F&I was established in January 2022 as a special- In 2022, Woori Financial F&I focused on strengthening its organizational structure and 2023 PLANS 2022 ACHIEVEMENTS ized investment company for NPLs (Non-Performing Loans) and CR securing stable investment assets. (Corporate Restructuring), with the aim of enhancing the Group’s non-banking business portfolio and capitalizing on the NPL market, which is highly expected to grow significantly in the future. Currently, the company is expanding its business portfolio through continuous investments in NPL assets and by maintaining a stable Securing stable investment assets through aggressive investments Despite being in its first year of operation, the company secured an investable credit rating (A-/stable) early on and investment funds totaling KRW 105.0 billion. At the same time, it cashed in on the Group synergies in structured financing to secure a total revenue base. It is also emerging as a leading player in the industry, of KRW 389.8 billion in investment assets (KRW 384.8 billion in NPLs and KRW 5.0 leveraging cross-subsidiary synergies and accomplishing strong billion in AIs). As a result, the company successfully entered the market and ended up competency-building accomplishments. with the second-largest NPL public bidding market share as of 2022. To broaden its investment portfolios, the company also received a PEF general partner’s license for institutional investors and obtained the qualifications required for becoming an investor partner of general private placement funds. Early setup of organizational system In 2023, the company will work on a mid to long-term growth foundation by reinforcing its NPL market competitiveness and revenue base and upgrading its substantial man- agement and business management system. To begin, the investment sector will continue collecting stable investment assets through aggressive participation in NPL public bidding while reinforcing its profitability through internalizing its asset management and developing differentiated disposition strategies by investment asset type. In order to diversify its revenue base, the company will actively seek alternative investments, including NPLs from the non-bank financial sector, non-performing real estate PFs, and NPL indirect investments. To that end, the company is actively considering stable and competitive funding sources, such as up- grading its credit ratings and issuing corporate bonds. Another focus will be on the overall management of the business. The company will continue recruiting experts in relative fields for its asset growth and AIs, enhance effi- ciency in its human resource management, expand its ESG management practices, and set up a dedicated team for refining its internal controls and risk management system. The company has completed an early setup of its management system, laying the In the future, the company will devote itself to fair and transparent investment activities foundation for its transformation into an investment specialized company. It has already as an industry leader, thereby contributing to the advanced soundness and stability of accomplished the establishment of articles of incorporation and internal regulations, financial markets. the implementation of business processes, the construction and stabilization of IT systems, the establishment of internal control and risk management systems, and the continuous recruitment of exceptional talents. Credit Rating (As of the end of 2022) A- stable Korea Investors Service, Issuer Credit Rating Total Investment Assets (As of the end of 2022) KRW 389.8 billion STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTWoori Asset Management www.wooriam.kr Woori Asset Management (WAM) is a comprehensive asset man- As of the end of 2022, total assets under management (AUM) reached KRW 30,710.6 agement company offering services related to fund management, billion, showing an growth of 12.1% (KRW 3,229 billion) compared to the previous year. 2022 ACHIEVEMENTS Financial Performance (Unit: KRW trillion) 048 investment consulting, discretionary investments, and more. The company is preparing to make significant progress as a well bal- anced comprehensive asset management company by leveraging the synergy and network of Woori Financial Group. With leading expertise in domestic bond management, the company aims to ex- pand into domestic equities and global operations. As one of the leading ESG asset management companies, WAM is entrusted with discretionary investment funds from various institu- tions such as pension funds, insurance companies, banks, and mu- WAM's FY 2022 market share in AUM stands at 2.13%, which represents a 0.25%p increase from the previous year(1.88%). The significant changes in AUM came from its money market fund (MMF), which grew by 49.9% YoY to reach KRW 4.0 trillion, and global fund of funds, which recorded a growth of KRW 200.9 billion by 41.9% YOY. Due to it's excellent performance. In 2022, the company ventured into various new businesses such as ETF, TRF, ELS, global investments, and pension business to secure balanced growth and future growth drivers. In June 2022, WAM became the first Kore- an Asset Management company to obtain FNGuide's ESG Fund certification, consoli- AUM (Unit: KRW trillion) dating its brand recognition as a leading ESG Asset Management company. tual finance. 2023 PLANS Social Contribution Activities group. Woori Asset Management aims to improve profitability and expand AUM through di- versifying investment strategies by asset class and strengthening synergy within the Money Today’s 2022 Korea Funds Awards •ESG Fund of the Year Seoul Economic Daily’s 2022 Korea Securities Awards •Best ESG Fund Award 2022 MK Securities Awards •Best Domestic Bond-type Funds Award 2022 Korea Wealth Management Awards •Bond-type management of the Year We will persistently strive to expand our market share and increase the scale in the rapidly growing retirement pension market by enhancing the competitiveness of our pension fund products and broaden our network through customized sales strategies for individual customers. Additionally, as a late starter in the fast-growing ETF market, WAM will develop unique products to gain a competitive edge in the market, while also expanding its AUM through systematic marketing and sales network growth based on reinforced digital marketing capabilities. This year, we will establish dedicated divisions for our key growth businesses, including retirement pension funds and ETFs. Through proactive talent acquisition, our aim is to lay the foundation for long-term growth. By expanding group synergies, we will enhance product competitiveness and strengthen our capabilities in product development and sourcing. This strategic approach will enable us to establish a virtuous cycle structure for sustained growth. 3 0 7 1 . 2 7 3 9 . 2 1 1 5 . 2020 2021 2022 +3.32(+12.1%) YoY Market Share (Unit: %) . 2 1 3 . 1 8 8 . 1 6 0 2020 2021 2022 YoY +0.25%p 202020212022AUM21.1527.3930.71Domestic Equities1.422.332.03Domestic Bonds12.5014.5813.90MMF5.057.9611.94Offshore/Fund of Funds1.962.192.84STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTWoori Venture Partners www.woorivp.com Woori Venture Partners is a leading venture capital (VC) firm with a legacy spanning over 40 years since its establishment in 1981. Its current assets under management (AUM) amounts to KRW 1.5 trillion. 2022 ACHIEVEMENTS Pre-Integration Highlights As of the end of 2022, Woori Venture Partners was managing a total of 18 funds, with a total committed capital of KRW 1.5 trillion. Over 40 domestic and international insti- Following its successful privatization, the company was renamed KTB tutions are participating as limited partners (LPs) in our managed funds. Despite the Network in 2000 and gained its current name in 2023 when it joined challenging funding environment for venture capital firms due to the rapid increase in Woori Financial Group. This strategic integration has set the stage for a new chapter in the company’s history, one marked by new begin- nings and heightened ambitions. Today, its main business line is venture investment in accordance with the Act on the Promotion of Venture Investment. In addition, the com- interest rates following the post-pandemic period in 2022, we successfully launched a new fund totaling KRW 304.8 billion. The first closing of the scale-up fund, which raised KRW 261.3 billion, attracted investments from prestigious domestic institutional investors, such as the National Pension Fund, Korea Venture Investment Corp., Korean Teachers’ Credit Union, Korea Scientists and Engineers Mutual-aid Association (SEMA), and the National Agricultural Cooperative Federation. The fund size will grow further pany actively participates in some of the world's most noteworthy through a second closing, which is scheduled to take place by the end of June 2023. 049 2023 PLANS Since it joined Woori Financial Group in March 2023, Woori Venture Partners has been actively pursuing value creation, strict compliance, prevention of moral hazards, and the promotion of shared goals among fund participants as its operational philosophy. As the leading venture capital firm in the Korean VC industry, the company is preparing for a new chapter in its history to become a top-of-top VC. It is currently working on the multi-closing of a scale-up fund that had a first closing of KRW 261.3 billion. With the aim of growing the fund size to over KRW 350 billion, and if it successfully closes the fund, it will become one of the top three VC funds in Korea based on its total com- mitted amount. The company is also preparing to expand its investments beyond the traditional venture capital domain, including secondary investments and growth capital. At present, it has more than KRW 400 billion in dry powder, providing the company with sufficient investment capabilities. Moving forward, the company plans to engage in proactive investment activities to support the growth of venture companies facing challenging business environments due to the impact of higher interest rates from the post-pandemic period. investment hubs, including Silicon Valley, Shanghai, and Singapore. Milestones & Awards 1981 Founded as Korea Technology Development Inc. 2000 Renamed KTB Network 2008 Captive spinoff of VC Division from KTB Network 2011 Business license for SME Startup Investment 2021 Listed on KOSDAQ 2022 Renamed Daol Investment 2023 Incorporated into Woori Financial Group (renamed Woori Venture Partners) Additionally, the company has established a new startup fund totaling KRW 43.5 billion to expand investments in early-stage firms. These days, the company is investing in startups from different sectors, including ICT, bio/healthcare, deep tech, and consumer tech. Since the company’s foundation, its portfolio has accumulated over 2,000 in- vestee firms. Among them, 314 companies from the portfolio have been listed on stock exchanges. Growth of Committed Amount (Unit: KRW billion) Committed Amount (Unit: KRW billion) 8 5 3 5 . 8 8 3 5 . , 1 1 1 9 5 . CAGR : 14.3% , 1 4 5 9 3 . , 1 1 5 4 5 . Winner of the Best Loan Officer Award (awarded by the Minister of SMEs & Startups) at the 2022 Korea VC Awards : Park Seon-bae, Executive Director 2018 2019 2020 2021 2022 202020212022YoYVC1,079.51,114.51,419.3+304.8PEF40.040.040.00Total 1,119.51,154.51,459.3+304.8STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT 050 Woori Global Asset Management www.wooriglobalam.com Woori Global Asset Management (WGAM) is the Group’s leading Founded in December 2000, WGAM has its roots in the advanced investment tech- In 2023, WGAM plans to significantly grow its AI business areas into renewable energy, comprehensive asset management company specializing in both niques it gained through as part of the Allianz Group and An Bang Insurance Group. environmental projects, and data centers, while also concentrating its resources on off- 2022 ACHIEVEMENTS 2023 PLANS traditional investments and alternative investments (AI). Today, WGAM is strategically expanding its products and investments in AI which includes Infrastructure, renewable energy, real estate, cor- porate acquisition financing and Private Debt Funds (PDF). Moving forward, WGAM will focus maintaining its strong track record in tra- ditional investments (equities and bonds) and continue to acceler- ate on its AI expansion to become not only a leading comprehensive asset manager but also a leading AI specialist. And it has Joined Woori Financial Group in August 2019. As a member one of the larg- shore FoFs and bond-type PEF/discretionary investment management. est and oldest financial groups in Korea, the company is accelerating expansion in AI and overseas Fund of Funds investments. With respect to AIs, it will create blind funds and project funds that will invest in the energy and infrastructure sectors, as well as debt funds and mezzanines (CBs) for real Korea’s AI market abruptly deteriorated after a series of disruptions in the bond and estate and properties. It will also expand indirect investments that invest in advanced project finance markets in the second half of 2022. Global financial markets have also markets to broaden its business scope into overseas AI. been experiencing similar situations during the same period. Against this backdrop, the company achieved KRW 1.9 trillion of new commitments for its AI funds in 2022, with its AI AUM reaching KRW 3.3 trillion, an increase of KRW 800 billion YoY. In terms of traditional investment vehicles, the company is preparing to reopen and market its overseas FoFs as it leverages the know-how it has accumulated with the PIMCO Overseas Fund of Funds, which managed an AUM of more than KRW 1 trillion, More importantly, the company continued its growth in infrastructure investments, as a rare size as a single fund. Bond-type funds, which excelled in 2022, will attract addi- it was renamed a trustee in the Innovation Growth New Deal Fund once again in 2022, tional funds from existing institutional clients while recruiting new institutional clients as following its original designation in 2021. This allowed the company to establish the well. Policy-Type New Deal Fund No. 2, which includes policy funds. As such, WGAM is taking a differentiated approach with its growth strategies for AI and Moreover, despite the harsh bond market, the company’s fund managers recorded traditional investment vehicles. It will also commercialize AI products for retail custom- excellent investment performance results in the management of bond-type funds. As a ers and launch a mixed fund that carries both AIs and traditional investment vehicles result, WGAM was singled out as an excellent investment partner by its biggest institu- as underlying assets, while exploring synergy opportunities with its overseas indirect tional client, Korea’s National Health Insurance Service. investments, which has a relatively high market reputation. Certifications and Awards AUM Size Growth in Alternative Investments (Unit: KRW billion) Dec. 23. 2022 Selected as an excellent trading partner in 2022 by the National Health Insurance Service (absolute re- turn-seeking bond-type fund) * Data from Korea Financial Investment Association’s stats Assets Under Management (As of the end of 2022) KRW 8.3 trillion 202020212022YoYReal Estate 404.9853.51,192.8+339.3Special Asset 599.21,213.81,773.0+559.2Total 1,004.12,067.32,965.8+898.5STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT051 Woori Private Equity Asset Management www.wooripe.com Established in October 2005, Woori Private Equity Asset In the face of harsh economic conditions domestically and internationally, the company Woori Private Equity Asset Management aims to maintain both qualitative and quanti- Management is a first-generation private equity management achieved quantitative and qualitative growth in 2022. By seeking new investment op- tative growth in 2023, with the goal of securing a competitive edge through substantial 2022 ACHIEVEMENTS 2023 PLANS company in Korea. Having first started as a private equity fund (PEF) management company, Woori Private Equity Asset Management extended its services to include the management of hedge funds (alternative investments) in July 2016. Today, the company supports the Group’s scale-out efforts in its IB operations. Certifications and Awards Mar. 8. 2022 Named as a fund manager of the Korea Growth Finance Policy-type New Deal Fund (carbon neutrality, green industry) Oct. 20. 2022 Named as a fund manager of the Export-Import Bank of Korea portunities with both stability and profitability guaranteed to the highest degree possi- management and core competency-building. ble, the company launched new funds totaling KRW 643.1 billion (KRW 519.4 billion in PEFs and KRW 123.7 billion in AIs). For its part, the PEF division plans to maximize its return on investments (ROI) through extensive “Value-Up” initiatives with the companies in its investment portfolio while As of the end of 2022, the PEF division had a total of 7 funds under its management, also generating strong ROI performance from investments on the two new blind funds with a total commitment of KRW 858.7 billion. it launched in 2022. In addition, it will focus on discovering new investment opportuni- In 2022, the company achieved remarkable growth in its PEF operations, launching several major blind funds. In May 2022, the Green ESG Growth No. 1 PEF was es- ties from among large-cap and middle-sized enterprises to establish new mega-sized project funds. As such, it plans to firmly solidify its leading position in the PEF market. tablished as a KRW 165.2 billion-worth blind fund focusing on investments in ESG With the AI division, it will focus on bringing about stable performance results through industries, such as green businesses. The primary funding source was mega-sized comprehensive follow-up management of existing investment projects as it continues institutional investors. A month later, the NH Woori New Deal Growth Alpha No. 1 PEF with its scale-out efforts into corporate investments—on top of its traditional real estate, was also created as a KRW 220.0 billion blind fund to invest in the Fourth Industrial infrastructure, and indirect investments—to reinforce profitability. Revolution sector, including the digital industry. Additionally, a KRW 124.0 billion project fund was launched to invest in Korean conglomerates’ overseas subsidiaries operating in eco-friendly energy businesses. At the same time, the company carried out ex- haustive monitoring and value-up activities to its existing funds under management in dealing with the adverse market environment. In particular, the Woori Hanhwa Eureka PEF, a KRW 43.5 billion project fund that was launched in 2018, generated an excellent gross internal rate of return (IRR) at 15% in November 2022, despite the difficult market conditions. Concerning the alternative investment division, it operated a total of 16 funds with a cumulative commitment amount valued at KRW 1,215.2 billion as of the end of 2022. In the face of the many challenging market developments in 2022, the division con- Financial Performance (Unit: KRW billion) Year-end Balance centrated on finding profitable investment opportunities and created a domestic SOC Cumulative Commitment Amount (including dissolved funds) investment fund worth KRW 87.7 billion. It also established a KRW 36.0 billion equity investment fund that invests in the overseas subsidiaries of Korean conglomerates, thereby expanding its business portfolio from its previous focus on real estate, infra- structure, and indirect investments to corporate investments. Indeed, the AI division has steered clear of any losses on investments since its launch in July 2016, thanks in no small part to its prudent and preemptively pre-/post-risk management practices. 202020212022YoYPEF361.6382.8858.7+475.9AI1,359.31,192.61,215.2+22.6Total1,720.91,575.42,073.9+498.5202020212022YoYPEF1,372.91,394.11,913.5+519.4AI1,509.31,667.81,791.5+123.7Total2,882.23,061.93,705.0+643.1STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Woori Credit Information www.wooricredit.com Woori Credit Information’s main lines of business consist of debt col- As of 2022, Woori Credit Information has maintained a debt-free status, highlighting its lection, credit research, and asset management. Since its establish- strong financial position. Moreover, the company has consistently generated profits since ment as a credit information company in Korea, it has established itself its establishment, demonstrating its sustained financial success. Additionally, the company 4 2 2 . 4 2 8 . 2022 ACHIEVEMENTS Total Assets (Unit: KRW billion) 052 as a frontrunner in the industry. Throughout the years, the company has demonstrated consistent financial stability, boasting the lowest level of liabilities and the largest asset size among all credit information firms in Korea affiliated with financial holding companies. Presently, Woori Credit Information is expanding its revenue streams beyond the cross-selling effect within the Group, aiming to strengthen its indepen- dent capabilities and effectively prepare for any unforeseen market has upheld its stable financial soundness by maintaining the lowest level of liabilities and the largest asset size among all Korean credit information firms associated with financial 3 1 4 . holding companies. As the pie graph on the right shows, Woori Credit Information earns the largest percentage of revenue from its non-affiliates relative to its competitors, further proving its high level of Comapny A Comapny B Woori competitiveness. The company has long reinforced its business viability by sustaining a di- versified clientele list outside the holding company and by expanding its business domains. KRW 42.8billion uncertainties. Moving forward, the company will maintain its market 2023 PLANS leadership by leveraging its strong marketing capabilities and excep- tional management efficiency. Woori Credit Information set its management goal for 2023 at strengthening core compe- tencies and expanding its future growth foundation. To that end, the company is pursuing the following strategies: First, the company aims to generate a stable source of revenue. It will begin by marketing its existing clients, such as public organizations and financial companies, to increase its sales and induce long-term contracts from new major clients, such as credit card compa- nies and banks, so as to contribute to the sales growth from its non-affiliate clients. Second, the company is set on securing unrivaled competitiveness. By consolidating its competitive edge in credit research and asset management industries, the company will reinforce its competitiveness outside of debt collection operations in a bid to diversify its revenue streams, which have traditionally been concentrated on debt collection. Third, the company is focusing on enhancing its management system. It will revise its bylaws per the latest updates to all relative laws and operational guidelines. It will also streamline its sales and general administrative expenses by zeroing unnecessary and redundant costs as well as rationally allocating and operating its budget. Lastly, the company will continue to contribute to social value. In order to enhance its Debt-to-equity Ratio (Unit: %) 59.0% 33.4% 21.6% Comapny A Comapny B Woori Non-affiliate Sales Contribution (Unit: %) Comapny A Comapny B Woori 1.7% 18.5% 29.1% Certifications and Awards Winner in the social welfare category for the sixth straight year at the Digital Chosun Ilbo’s 11th Corporate Social Responsibility Awards cooperation with the Group’s ESG management initiative, the company will seek to di- Industry-Leading Percentage of Revenue from Non-affiliates versify the direction of its practical and effective ESG management practices while also doing its best to increase debt restructuring support for financially vulnerable customers. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTWoori Fund Service www.woorifs.co.kr Woori Fund Service provides diverse administrative services and Despite the difficult market environment in 2022, Woori Fund Service successfully In addition, the company has plans to carry out full-fledged marketing activities for has been established under Article 254 of the Financial Investment expanded its customer base as a result of its stable operating system, which helped it its digital asset administrative management services based on its own digital asset Services and Capital Markets Act. These services encompass fund surpass KRW 150 trillion in assets under management (AUM) by the end of the year. business accounting solution (DABAS), which will serve investors with fair and reliable accounting, establishing reference prices for collective investment In 2022, the company concentrated on improving its internal controls and system up- information on digital assets. 2022 ACHIEVEMENTS nance. 053 vehicles, and offering general administrative support for real estate investment trusts (REITs). After the successful development of the next-generation FundOne system, the company continues to innovate by creating new systems and nurturing talented individuals. These efforts aim to enhance the quality of services provided, reinforcing Woori Fund Service's pride as a member of Woori Financial Group. grades. While developing a synergy framework through collaborations with Group affil- As of the end of 2022, the company was also working on an integrated cryptocurrency iates, it also strived to enhance employees’ job satisfaction, which included adopting a disclosure service platform through multi-party agreements, with related services slat- “work-life balance leave” to induce the long-term employment of professional person- ed for launch in the near future as well. This will contribute to protecting customer as- nel and implementing systematic job training. sets and improving the soundness in cryptocurrency trading markets while generating In fact, Woori Fund Service successfully harnessed some of the Group’s synergies to expand its business operations. First, the company had its peer affiliate Woori Asset Management test the ETF accounting system, which was developed as a requisite for its new venture into the ETF administration management business. It also worked with Woori Global Asset Management to develop an alternative investment management system. Furthermore, the company successfully landed an office management service order from Woori Asset Trust for new REITs. new revenue streams for the company at the same time. Net Income (Unit: KRW billion) 3 9 . 3 6 . Additionally, Woori Fund Service successfully completed the trademark registration and patent application for its Digital Asset Administrative Management service, which it launched in 2021 for the first time in the industry. This has secured the intellectual 2 6 . property rights for the administrative management of digital assets, giving Woori Fund 2020 2021 2022 Service a springboard to become the market leader in the general administrative man- YoY +0.3 agement industry. 2023 PLANS Shareholder’s Equity (Unit: KRW billion) Before Woori Fund Service entered the market, the KRW 80 trillion ETF administrative management market was split up between just two companies that could provide the necessary services. As of April 7, 2023, Woori Fund Service began challenging the oth- er two market players with the launch of its ETF administrative management service— and its first client was Woori Asset Management. 2 2 2 0 1 7 Drawing on its high technology in system integration, the company will engage in an aggressive marketing campaign to outstrip the limited competition of their market domi- 2020 2021 2022 YoY +2 STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT054 Woori FIS www.woorifis.com Woori FIS serves as the group's dedicated IT subsidiary, overseeing Guided by its management goal for 2022, leading the financial IT sector through the comprehensive IT outsourcing for the major affiliates. Its responsi- convergence of innovation and stability, Woori FIS pursued four management strat- bilities encompass maintaining the stable operation of core systems egies: reinforcing digital services, improving customer-centric services, enhancing 2022 ACHIEVEMENTS for Woori Bank and Woori Card, as well as driving digital transfor- mation. Woori FIS strategically directs its organizational capabilities towards innovative initiatives across all IT domains, with the ultimate goal of supporting the group in achieving its strategic objectives. Certifications and Awards June 24. 2022 Korea’s first financial IT service provider to obtain internationally stability and internal controls, and strengthening efficiency-oriented business manage- ment. The key tasks supporting these strategies included supporting all the Group-wide dig- ital transformation synergies through digital education programs and adoption of RPAs at individual Group subsidiaries; expanding BA support and competency-building for the higher satisfaction of its customer-oriented services; broadening the application of its IT failure prevention system to the Group-wide level; and securing an organizational system for smoother IT-Biz collaboration between the business divisions and IT devel- opers. 2023 PLANS recognized ESG certifications, Woori FIS set its management goal for 2023 at Culture Change, Technology Challenge. the ISO 14001 (environmental management system) / In line with this goal, it has developed five business strategies. It has implemented di- ISO 45001 (occupational health & safety management system) verse tasks in order to: lead futuristic technology, enhance customer service, broaden Oct. 28. 2022 Korea’s first financial holding company subsidiary to obtain the ISO 27017 (international cloud security standards) its growth foundation, innovate its corporate culture, and upgrade its risk management. The key tasks will be: optimizing the environment for developing future technologies, such as establishing the latest channel framework and open source sharing portals; stepping up its support of Group-wide IT projects, including rebuilding the WON Banking platform and installing an independent merchant network for Woori Card; un- covering digital business models to internalize innovative technological competencies; realizing a corporate culture that puts core values into action; and completing down- time-free/failure-free IT systems. In the future, Woori FIS will stand by the Group as its most reliable IT and digital partner, working tirelessly to support the enhancement of the Group’s business competencies. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Woori Finance Research Institute www.wfri.re.kr The Woori Finance Research Institute (WFRI) was founded on De- In 2022, Woori Financial Research Institute strived to support the Group’s formation of Woori Finance Research Institute has set its management goal for 2023 to take the cember 26, 2012 under the vision of innovating today to create digital portfolios, establish the Group business support process, strengthen the role of next step forward to become a leader in financial group strategy consulting. To attain tomorrow. Committed to the stable growth of Woori Financial Group the mobile app-based knowledge platform, and upgrade its research output. this goal, WFRI devised four management strategies: 1) strengthening its responsive- 2022 ACHIEVEMENTS 2023 PLANS 055 and the development of Korea’s financial industry, WFRI carries out WFRI published 417 research reports throughout the year, up from the 412 reports in research activities in all aspects of finance and economic affairs, 2021. In addition, the institute studied and reported on the best digital innovation prac- tices by global financial companies in support of the Group’s digital platform competen- ness to changes in the internal and external business environment; 2) upgrading its in- house consulting competencies; 3) supporting the Group to reinforce global network competitiveness; and 4) upgrading its research output and utilization. such as the business strategies of financial companies, the financial sector, and financial markets, as well as macroeconomic issues. The institute is positioning itself as a trusted opinion leader in the Ko- rean financial industry by supporting relevant insights for effective management decisions and setting the best direction for pertinent cy-building. It also provided consulting services for Group subsidiaries and the global In 2023, WFRI will concentrate its research capacity on supporting the Group’s strate- network, contributing to growing the Group network and revenue base. WFRI also pre- gic decision-making so that it can preemptively and effectively respond to the rapidly sided over the Group-wide Macroeconomic and Financial Market Indicators Forecast- changing market environment both at home and abroad. To help each Group subsid- ing Council, where experts from inside and outside the Group supported the Group’s iary reinforce its competitiveness in core businesses, the institute will provide regular risk management and asset management businesses. For example, its case study on consulting services on their business operations at least once a year. By expanding financial policies. the ESG management practices of global financial companies helped establish the its scope of research into wealth management, CIB, and digital, WFRI aims to contrib- Group’s ESG management system that is now on par with the most respected global ute to bolstering the Group’s future growth drivers. It will also continue carrying out its standards. Furthermore, the institute provided research report subscription services to consulting services on the Group’s global network and research on the global business Group employees and the public in general while also holding conferences and special strategies of leading global banks to support reinforcing the competitiveness of the lectures by experts to build and promote its financial and economic content. Group’s overseas network. On top of these efforts, the institute will keep upgrading its qualitative and quantitative research output so that it can play an essential role in the Group-wide promotion of knowledge management practices and enhancement of its brand value. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTOrganizational Chart 056 General Shareholders Meeting Board of Directors CEO Board Officer Candidates Recommendation Committee Board Audit Committee Audit Unit Board Risk Management Committee Board Compensation Committee Board Group CEO Candidates Recommendation Committee Coporate Culture Innovation TF Board ESG Management Committee Strategy Planning Unit Future Business Unit Finance Planning Unit Digital / IT Unit Brand Unit Risk Management Unit Management Support Unit Compliance Officer Strategy & Planning Department ESG Management Department Finance & Management Department Digital Innovation Department Public Relations Department Risk Management Department Management Support Department Compliance Department Audit Department Synergy Management Department Business Portfolio Department Future Finance Department Accounting Department IR Department Data Intelligence Planning Department Brand Strategy Depatment Risk Model Validation Department ICT Planning Department STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT057 GLOBAL NETWORK Woori Bank Head Office The 20th and 21st Floor of Woori Bank Main Office, 51, Sogong-ro (203, Hoehyeon-dong 1-ga), Jung-gu, Seoul, 100-792, Korea Phone: +82-2-2125-2000 Swift: HVBKKRSE Overseas Branch Company Phone Address Company Phone Address New York Agency 1-212-949-1900 245, Park Ave. 43rd Floor, New York, NY 10167, USA LA Br. London Br. Tokyo Br. Hong Kong Br. Singapore Br. Bahrain Br. Dhaka Br. 1-213-620-0747~8 3360, Wwest Olympic Blvd. Suite 300, LA, CA90019, USA 44-207-680-0680 9th Floor, 71 Fenchurch Street, London, EC3M 4BR,UK 81-3-6891-5600 Shiodome City Center 10th Floor, 5-2 Higashi-Shimbashi 1-Chome, Minato-ku, Tokyo, 105-7110 Japan 852-2521-8016 Suite 1401, Two Pacific Place, 88 Queensway, Hongkong 65-6422-2000 10 Marina Boulevard #13-05 MBFC Tower 2, Singapore 018983 973-17-223503 P.O. Box 1151, 4th Floor, Entrance 1, Manama Centre Building, Manama, Bahrain 88-02-5881-3270~3 Suvastu Imam Square (1st & 4th Fl.) 65 Gulshan Avenue, Dhaka, Bangladesh DEPZ Customer Service Center 880-2778-8030 Dhaka Export Processing Zone(Old Area), Ganakbari, Ssvar, Dhaka-1349, Bangladesh Woori Bank Chittagong Sub-Branch 880-931-728221~4 Woori Bank Uttara Sub-Branch 880-2896-2125~6 Ayub Trade Center, Holding # 1269/B, Sheikh Mujib Road, Agrabad Commercial Area, Gosaildanga, Ward #36, Double Mooring, Chattogram, Bangladesh Paradise Tower(Ground Floor) Plot 11, Sector 3, Uttara Model Town,Uttara, Dhaka 1230, Bangladesh Woori Bank Mirpur Sub-Branch 880-2902-1061~2 Padma Bhaban(First Floor), 1/9 Mirpur Road Pallabi, Mirpur-12, Dhaka-1216, bangladesh Woori Bank Narayanganj Sub-Branch 880-2769-2031~34 Adamjee Export Processing zone, Shiddhirganj, Narayanganj-1431 Bangladesh Woori Bank Motijheel Sub-Branch 880-2471-21001~04 AA Tower, 23, Ground Floor, Motijheel C/A, Dhaka Woori Bank Kawranbazar Sub-Branch 880-2446-12238~41 A.H.N Tower, Ground Floor, 13 Biponon C/A, Sonargaon Road, Bagla Motor, Dhaka Chittagong Customer Service Center 880-3133-3340362 BEPZA Building, 1st floor of Zone Services Complex in Chattogram EPZ(CEPZ) Gaeseong Br. Sydney Br. 001-8585-2300~2 Gaesong Industrial District Phase 1, 25 - 1 Business Support Center, 1st Floor 103 1st Floor, Bongdong-Ri, Gaeseong, Hwanghae-Do, North Korea* 61-2-8222-2200 Suite 21.02, 126 Phillip Street, Sydney, NSW, Australia Woori Bank Dubai Br. 971- 4-325-8365 Woori Bank India Regional Headquarters 91-22-6263-8100 1102A, Level 11, The Gate Building, East Wing, P.O. Box 506760, DIFC, Dubai, United Arab Emirates Unit 601, 6th floor, Birla Centurion, Century Mills Compound, Pandurang Budhkar Marg, Worli, Mumbai, Maharashtra-400030, India * Due to the shutdown of the Gaeseong Industrial Complex in February 2016, the Gaeseong Branch is currently located at our corporate headquarters in Seoul Woori Bank Chennai Br. 91-44-3346-6900 Woori Bank Mumbai Br. 91-22-6263-8100 Lotte India, 2nd Floor, No.4/169, Rajiv Gandhi Salai(OMR), Kandhanchavadi, Perungudi Taluk, Chennai-600096, Tamil Nadu, India Unit 601, 6th floor, Birla Centurion, Century Mills Compound, Pandurang Budhkar Marg, Worli, Mumbai, Maharashtra-400030, India Overseas Branch Company Phone Address USA Woori America Bank Woori America Bank, Manhattan Br. Woori America Bank, Flushing Br. Woori America Bank, Fort Lee Br. Woori America Bank, Woodside Br. Woori America Bank, Ridgefield Br. Woori America Bank, Palisades Park Br. Woori America Bank, Closter Br. Woori America Bank, Elkins Park Br. Woori America Bank, Annandale Br. Woori America Bank, Bayside Br. Woori America Bank, Ellicott City Br. Woori America Bank, Wilshire Br. Woori America Bank, Olympic Br. Woori America Bank, Fullerton Br. Woori America Bank, Buena Park Br. Woori America Bank, Centreville Br. Woori America Bank, Irvine Br. Woori America Bank, Torrance Br. Woori America Bank, San Jose LPO 1-212-244-3000 1-212-244-1500 1-718-886-1988 1-201-363-9300 1-718-429-1900 1-201-941-9999 1-201-346-0055 1-201-784-7012 1-215-782-1100 1-703-256-7633 1-718-224-3800 1-443-973-3690 1-213-382-8700 1-213-738-1100 1-714-521-3100 1-714-534-6300 1-703-988-9555 1-949-885-3760 1-310-974-1880 1-415-652-9476 330 5th Avenue New York, NY 10001, USA 330 5th Avenue New York, NY 10001 136-88 39th Avenue Flushing New York, NY 11354, USA 2053 Lemoine Avenue Fort Lee, NJ 07024, USA 43-22 50th St. Woodside, NY 11377, USA 321 Broad Avenue #104 Ridgefield, NJ 07657, USA 225 Broad Avenue Palisades Park, NJ 07650, USA 234 Closter Dock Road Closter, NJ 07624, USA 7300 Old York Rd Elkins Park, PA 19027 Seoul Plaza 4231 Markeham St. Annandale, VA 22003, USA 215-10 Northern Blvd. Bayside, NY 11361, USA 100352 Baltimore National Pike Ellicott City, MD 21042, USA 3540 Wilshire Blvd. Unit 104, Los Angeles, CA 90010, USA 3360, West Olympic Blvd. Suite #300, LA, CA90019, USA 5731 Beach Blvd., Buena Park, CA 90621, USA 6940 Beach Blvd #D-124, Buena Park, CA 13832 Braddock Road. Centreville, VA 20121, USA 14252 Culver Dr. #G, Irvine, CA 92604 2390 Crenshaw Boulevard, Units C Torrance CA 90501 USA 2328 Walsh Ave, Santa Clara CA 95051 USA STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Company Phone Address Company Phone Address 058 Woori America Bank. Northern 1-929-362-3330 164-25 Northern Blvd. Flushing NY 11358, USA Woori America Bank. Dallas LPO 1-972-810-0166 1028 MacArthur Dr.Suite #108, Carrollton, TX, 75007 Woori America Bank. Chicago LPO 1-224-938-9553 1247 Milwaukee Ave, Suite 207, Glenview, Illinois, 60025 Woori America Bank. Seattle LPO 1-206-948-6691 19401 40th Avenue West, Lynnwood, Washington, 98504 Woori America Bank, Dallas Br. 2405 S. Stemmons FWY, Lewisville, TX 75067 Woori America Bank, Duluth Br. 1-770-624-5930 3360 Satellite Blvd., Suite 14, Duluth, GA 30096 CHINA Woori Bank (China) Ltd. 86-010-8412-3000 Woori Bank (China) Ltd. Head office busi- ness department Woori Bank (China) Ltd. Beijing Br. 86-010-8441-7771 86-010-8453-8880 Woori Bank (China) Ltd. Shanghai Br. 86-021-5081-0707 Woori Bank (China) Ltd. Shenzhen Br. 86-0755-3338-1234 Woori Bank (China) Ltd. Suzhou Br. 86-0512-6295-0777 Woori Bank (China) Ltd. TianJin Br. 86-022-2338-8008 Floor 11-12, Block A Building 13, District4, Wangjing East Park, Chaoyang District Beijing China 100102 Floor1 Block B Building 13 District4 Wangjing East Park Chaoyang District Beijing China 100102 1801-3, 1801-4, Samsung Building, No.31, Jinghui Street, Chaoyang District, Beijing, China 104B,502, Dongfangchunyi Building 1, 5F, Eshan Avenue 505 Pudong New Area, Shang- hai,200122, China 1001,1002,1003,1004,1008 ,Hon Kwok City Commercial Center, Fuming Road, Futian District, Shenzhen, China 6F Building #58 Suzhou Center, Suxiu Road,Suzhou Industrial Park, Jiangsu, China NO.1 Building, Aocheng Commercial Square, Binshui West Road, Nankai District, Tianjin, 300381 CHINA Woori Bank (China) Ltd. Shanghai Puxi Sub-Br. Woori Bank (China) Ltd. Beijing Wangjing Sub-Br. Woori Bank (China) Ltd. Shanghai Wuzhonglu Sub-Br. Woori Bank (China) Ltd. Shenzhen Futian Sub-Br. Woori Bank (China) Ltd. Shanghai Jinxiujiangnan Sub-Br. Woori Bank (China) Ltd. Beijing Shunyi Sub-Br. 86-021-5208-1000 1F, Maxdo Center, NO.8 Xingyi Road, Changning District, Shanghai, 200336, China 86-010-8471-8866 1F,NO.10, FURONG STREET, CHAOYANG DISTRICT, BEIJING 100102, CHINA 86-021-6446-7887 1C, Liaoshen Building, 1068 Wuzhong Road, Minhang District, Shanghai, 201103, China 86-0755-8826-9000 Room 107, Daqing Building, NO.6027 Shennan Road, Futian District, Shenzhen 518040, China 86-021-3432-1116 No.101-1, 102 MT BLDG, 3999 Hongxin Road, Minhang District, Shanghai,China, 201101 86-010-8945-2220 1-107A GangXin JiaYuan Shunyi District Beijing 101300 China Woori Bank (China) Ltd. DaLian Br. 86-0411-8765-8000 Woori Bank (China) Ltd. Zhangjiagang Sub-Br. 86-0512-5636-6696 Woori Bank (China) Ltd. Chengdu Br. 86-512-028-6557-2336 Woori Bank (China) Ltd. Weihai Br. 86-0631-599-6000 Woori Bank (China)Ltd. Tianjin Dongmalu Sub-Br 86-022-8776-9000 WooriBank (China) Ltd. Chongqing Br. 86-023-6152-2222 Wooribank (China) Ltd. Shanghai Jinqiao Sub-Br. Wooribank (China) Ltd. Beijing Sanyuanqiao Sub-Br. 86-021-6882-0608 86-010-8440-7177 Wooribank (China) Ltd, Shenyang Branch 86-024-8186-0808 Wooribank (China) Ltd. Shenzhen Qianhai Sub-Br. 86-755-3683-0888 2F-218, Yoma IFC, NO.128 Jinma Road, Dalian Development Area, Dalian, P.R. China 116600 B104/B205 Huachang Oriental Plaza, 11 Renmin East Road, Zhangjiagang Jiangsu, 215600 China No.302-306, 3F, Ping'an Fortune Center, No.1, Renmin South Road(Section 3), Chengdu, Sichuan,China,610041 1801, 18th Floor, Building A3, Wisdom Valley, No. 17-5 Hong Kong Road, Economic and Technological Development Zone, Weihai City, Shandong Province, China 1-2F, No. 4 of TowerC, Yuding Plaza(Qixiang Street), Dongma Road, Nankai District, Tianjin, 300090, China Shop 2, First Floor, Jinjia International Building, No.10, GuiHua Street Branch Road, JiangBei District, ChongQing, China, 400000 Room 202, 2 / F, Building B1, Shanghai International Trade Center, No. 1599 New Jinqiao Road, Pudong, Shanghai, China 26F, Tower A, Tianyuangang Center, C2, North Road, East Third Ring Road, Chaoyang District, Beijing, China Room 2605-2608, Office Tower 1, Forum 66, No.1-1 Qingnian Street, Shenhe District, Shenyang City, Liaoning, China 1 Unit 07, 21/F, Qianhai Shimao Financial Center, No.3040 Xinghai Avenue, Qianhai Shen- zhen-Hong Kong Coorperation Zone, Shenzhen,China 62 285 4460505 62 351 4773000 62266-6251906 62711-315828 6221-7821756 62281-622212 62265-2351906 62341-421906 6231-5041906 62361-263755 62231-242006 6224-3521906 62271-633600 62274-549280 6221-50871888 62251-8377887 6221-50871906 6222-87241326 6221-29951906 6221-29529226 6222-87831906 Indonesia Bank Woori Saudara Head Office Corporate Branch Diponegoro Branch Cirebon Branch Bogor Branch Surapati Core Branch Surabaya Branch Semarang Branch Tasikmalaya Branch Yogyakarta Branch Denpasar Branch The Gedung Energy Branch Ampera Branch Purwokerto Branch Malang Branch Solo Branch Tangerang city Branch Pelembang Branch Sukabumi Branch Pekalongan Branch Madiun Branch Jamber Branch Kediri Branch Purwakarta Branch Subang Branch Karawaci Tangerang Branch Garut Branch Medan Branch Makassar Branch Bandar Lampung Branch Buah Batu Sub-Branch Kopo Sub-Branch Cimahi Sub-Branch Sukajadi Sub-Branch Soekarno Hatta Sub-Branch Pemuda/Rawamangun Sub-Branch Sumedang Sub-Branch Serang Sub-Branch Commercial Center Cikarang Sub-Branch 6221-89328838 Kramat Jati Sub-Branch Kebon Jeruk Sub-Branch Pajajaran Sub-Branch Lembang Sub-Branch Deltamas Cikarang Sub-Branch Majalengka Sub-Branch Kuningan Sub-Branch Indramayu Sub-Branch 6221-89972635 6221-53660160 62264-8227474 6221-47862070 6221-55772345 6261-42007100 6272-15604961 6241-18001859 6222- 7306347 6222-6634656 6222-5436802 6222-7509905 62262-544672 62 354 526726 62234-276236 6221-8002895 6222-2784797 62261-206527 62254-224142 62260-421014 62 331 421648 6222-2021761 6222-20565353 62233-8285460 62232- 8880938 Cibubur Sub-Branch 6221-84305050 Treasury Tower 26th, 27th FL. District 8 SCBD Lot 28 JI.Jend. Sudirman Kav. 52-53, Jakarta 12190 Treasury Tower 26th, 27th FL. District 8 SCBD Lot 28 JI.Jend. Sudirman Kav. 52-53, Jakarta 12190 JL. Diponegoro No,. 28, Bandung, West Java Komplek Cirebon Super Blok (CSB) Mall Office Park Kav. No. 11 Jl. Cipto Jl. Pangkalan Raya No. 8, Warung Jambu - Bogor/16151 Komp Surapati Core F-01-02 Bandung Jl. Raya Darmo No.89, Surabaya, East Java Ruko Imam Bonjol Square Kav 4 - Kota. Semarang Ruko Plaza Asia Blok A5-A6, Jl. HZ. Mustofa No. 326 - Tasikmalaya/46126 Jl. Mangkubumi No. 45 - Yogyakarta/55232 Ruko Griya Alamanda blok 3-4,Jl. Cok Agung Tresna Renon-Denpasar/80235 Gd The Energy Lot 11 A SCBD, Jl. Jendral Sudirman Kav 52 - 53, Jakarta/12190 Jl. Ampera Raya No. 20 Gd.Medco III/12560 Jl. Jenderal gatot Subroto No.78 Purwokerto - Jawa Tengah/53116 Jl. Letjen Sutoyo No. 27 Malang- Jawa Timur/65141 Jl. Ronggo Warsito No. 53 Kota, Solo - Jawa Tengah/57131 Tangerang City Business park Blok F/50 Jl. Jend. Sudirman No.1 Tangerang/15118 Jl. Basuki Rahmat No. 886 A - Palembang/30127 Jl. Jenderal Sudirman No. 31-Sukabumi/43111 Jl. KH. Mansyur No.64, Perkalongan Jl. Diponegoro No. 110, Madiun Jl. Gajah Made No. Ruko Gajah Mada Square Block A2-3 JL. Brawijaya No. 34 A, Kediri, East Java Jl. Basuki Rahmat No. 94, Purwakarta/41114 JL. Ahmad Yani No. 36/41211 Ruko Pinangsia Blok H No. 1 Lippo Karawaci Kel. Cibodas Tangerang/15139 Jl. Ahmad Yani No.33/44117 Jl. Zainul Arifin No. 53A Jl. Gunung Latimojong, Ruko Metro Square Blok E No. 1 Jl.. Raden Intan No. 80 D-E, Bandar Lampung , Lampung Jl. Buah Batu No. 58 Bandung/40265 Komp Ruko Mas J-9 Jl. Kopo Cirangrang/40225 Jl. Raya Cibabat No. 310 Cimahi/40213 Jl. Prof. Dr. Surya Sumantri Kav. 6, Bandung, West Java Jl. Soekarno Hatta No. 618 F/40286 Jalan Paus No 91F, Pulogadung, Jakarta Timur Jl. Prabu Geusan Ulun No.76/45311 Jl. KH. Abdul fatah Hasan No.53 Kel. Cipare Serang/42124 Ruko The Capitol, Kawasan Industri JABABEKA, Jl. Niaga Raya Blok 2 C, Bekasi, West Java Jl. Pondok Gede Raya No. 12 Jl. Kelapa Dua Raya(RayaPanjang) No.2, Rt 008, Rw 002 Kel. Kelapa Dua Kec. Kebon Jeruk/12130 Jl. Pajajaran no. 85, Bandung, West Java Jl. Grand Hotel Lembang No.25 Bandung/40391 Ruko Palais De Paris Blok. D Jl. KH. Abdul Halim No.447 Majalengka/45411 Jl. Dewi Sartika No.4/45512 Jl. DI. Panjaitan No.103/45212 Cibubur Times Square Blok B1/1 Jl. Alternatif Cibubur KM 3 Kel. Jatiraya, Kec. Jastisampur- na Bekasi/17435 STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTAddress Company Phone Address 059 Phone 62264-8385171/ 8385172 6221-7522091 62298-311828 6231-8922842 62321-383444 Jl. Terusan Sudirman No. 6B(Sudirman Center)/41373 JL. Margonda raya Ruko Aarden, Depok, West Java Ruko Wijaya Square B5 Jl.Diponegoro No. 110 Salatiga/50711 JL. H. Sunandar 6 No. 1, Sidoarjo, East Java Jl. Gajah Mada No.85B/60319 62263- 260941, 260943 Jl. Abdulah Bin Nuh No.15/43253 6221-7403205,7443335 Jl. RE. Martadinata No. 167 B RT.03 RW. 05 Cipayung, Ciputat, Kota Tangerang Selatan 62231-8330618 62274-367514 6221-29015618 6221-7330545 Jl. Dewi Sartika No. 57 Sumber/45611 Jl. Jenderal Sudirman No. 130 Kabupaten Bantul/55713 Komplek Ruko Balaraja Center Blok A No.2 Jl. Raya Serang Km. 24 Talaga Sari Balara- ja-tangerang/15610 Ruko Dian Plaza Jl. Raden Fatah No. 8A Kelurahan Sudirman Selatan,Ciledug/15225 62293-326498/326499 Ruko Metro Square Blok F No.25/56172 6222-6803940/41 Jl. Raya Padalarang No.463 H/40553 Company Cikampek Sub-Branch Depok Sub-Branch Salatiga Sub-Branch Sidoarjo Sub-Branch Mojokerto Sub-Branch Cianjur Sub-Branch Pamulang/Ciputat Sub-Branch Sumber Sub-Branch Bantul Sub-Branch Balaraja Sub-Branch Ciledug Sub-Branch Magelang Sub-Branch Padalarang Sub-Branch Patrol Sub-Branch Gianyar Sub-Branch Gresik Sub-Branch Karawang Sub-Branch 62234-5613627 62361-8958295 6231-3981758 62267-8407706 62231- 8832738-39 6221-82611045-46 62265-543111-3 62265-772221 62260-551773 62274-865922 62291-4249241 6221-87904397 Cibinong Sub-Branch Singaparna Sub-Branch Ciamis Sub-Branch Sleman Sub-Branch Losari Sub-Branch Bekasi/Pondok Gede Sub-Branch Kudus Sub-Branch Pamanukan Sub-Branch Majalaya Sub-Branch Pangalengan Sub-Branch Megablock Cilegon Sub-Branch Rangkasbitung Sub-Branch Tabanan Sub-Branch Surabaya /Darmo Boulevard Sub-Branch Soreang Sub-Branch Ujung Berung Sub-Branch 6222-7834128 Jemur Sari/Surabaya selatan Sub-Branch 6231-8480454 Luragung Sub-Branch 62223-2870016 Pangandaran Sub-Branch Purwodadi Sub-Branch Leuwiliang Sub-Branch 6222-5896880 62292-423399 6222-5979222 62252-203612 6231-7381906 62251-8640297 62361-814160 62254-8484772 6222-85963799 62265-630400,630010 Ciawi Tasikmalaya Sub-Branch 62265-455163,455167 Cilacap Sub-Branch Jombang Sub-Branch Banjar Sub-Branch Boyolali Sub-Branch Radio dalam Sub-Branch Singaraja Sub-Branch Manonjaya Sub-Branch 62282-534474 62321-878906 62265-740838 62276-323655 6221-7211005 62362-25098 62265-380510 Jl. Raya Patrol Anjatan Blok Bunder No. 52/45256 Jl. By.Pass Dharma Giri No.99/80511 Ruko KIG Jl. Tri Dharma Kav. A-14/61117 Perumahan Galuh Mas Ruko Street Festival Blok 3 No. H-9, Jl. Galuh mas Raya, Karawang, West Java Jl. Mayor Oking No 122, Kel. Cirimekar, Kec. Cibinong, Kabupaten Bogor Jl. Raya Timur No.45 Singaparna/46416 Ruko Jl Pasar Manis No. 35 -Kab. Ciamis Jl. Magelang KM 12.8 No.200/55514 Jl. Letjen S. Parman No. 20 Kecamatan Pabuaran , Kab. Cirebon Jawa Barat Jl Raya Jatimakmur Blok A No. 20 Pondok Gede, Kota Bekasi Ruko Taman Jatimakmur Indah JL. AKPB Agil Kusumadya No. 104 A, Kudus, Central Java Jl. Eyang Tirtapraja No.54 Kab.Subang/41254 Jl. Alun-alun utara/Jl. Tengah komp ruko permata majalaya Blok C6/40382 Jl. Raya Pintu Pangalengan KM-1/40378 Jl. Raya Ahmad Yani Komp. Cilegon Green Megablock D3 No. 17 - Kota. Cilegon Jl Hardiwangun No.6 B Rangkasbitung - Kab. Lebak Jl. Bypass Insinyur Soekarno No 17, Tabanan, bali Office Park II B.2 No.11 Jl. Raya Soreang No.412/40900 Jl AH Nasution No. 28 - Kota.Bandung Jl. Raya Jemursari No. 15C Surabaya/60237 Jl. Siliwangi No. 62, Ds. Luragungtonggoh, Kec. Luragung, Kab. Kuningan Jl. Parapat, Desa Pangandaran, kec pangandaran kab ciamis/46396 JL. Ahmad Yani No. 223, Grobogan, Central Java Jl. Raya Jasinga 11A Kel. Cibeber, Kec. Leuwiliang Kab Bogor/16640 Jl. Perjuangan No.80 Kp.Karanganyar Rt. 04 Rw. 05 Desa Pakemitan Kec Ciawi Kab. Tasik- malaya/46156 JL. Letjen Suprapto No.4, Cilacap, Central Java Ruko Cempaka Mas Regency Block B-2. JL Soekarno Hatta Kel Kepuhkembeng Kec Peterongan. Jombang, East Java JL. Letjen Soewarto No.160, Banjar, West Java Jl. Pandanaran No.179 B Kab.Boyolali/57313 JL. Radio dalam raya No.4 Kel. Gandaria Utara Kec. Kebayoran baru Jakarta selatan/12160 Jl. Ngurah Rai No. 16 Singaraja Kelurahan Kendran Kecamatan Buleleng/81112 Jl. RTA. Prawira Adiningrat No.214 A Desa Manonjaya kec.Manonjaya-Tasikmalaya Surabaya Utara /kertajaya Sub-Branch Batu Sub-Branch Palimanan Sub-Branch cibadak Sub-Branch Kemang Pratama Bekasi Sub-branch Wates Sub-Branch Karangnunggal Sub-Branch Wonogiri Sub-Branch Kawali Sub-Branch Kepanjen Sub-Branch Pamekasan Sub-Branch Kebumen Sub-Branch Mangga Dua Sub-Branch Kelapa Gading Sub-Branch Kayu Agung Sub-Branch Klaten Sub-Branch Pasuruan Sub-Branch Pati Sub-Branch Sumenep Sub-Brancch Pelabuhan Ratu Sub-Branch Posco Cilegon Sub-branch Union Square Cikarang Sub-branch Sadang Sub-Branch Cikajang Sub-branch Kendal Sub-branch Wonosari Sub-branch Purbalingga Sub-branch Sragen Sub-branch Bintaro Sub-branch KCP PROBOLINGGO KCP PANDEGLANG KCP PASAR ATOM KCP CITRA RAYA KCP CAKUNG Pondok Kelapa Sub-branch Ciracas Sub-branch KCP JEPARA KCP BANJARNEGARA Purworejo Sub-branch Brebes Sub-branch Karanganyar Sub-branch Ungaran Sub-branch Gading Serpong Sub-branch Dalem Kaum Sub-branch Pasar anyar Sub-branch Asabri Bandung Sub-branch Cililitan Asabri Sub-branch Asabri Sub-branch 6231-99452669 JL. Raya Gubeng No. 68 Ruko 21 , Surabaya, East Java 62341-513709 62231-343950 6266-531915 62254-369755 62274-6657325 62265 - 2584571/2584572 62271-633600 Jl. Brantas No.49 Batu-Malang/65314 Jl. Otto Iskandardinata No.503 Palimanan Jl. Raya Suryakencana RT 03 RW 08, Cibadak - Kab. Sukabumi Jl. Niaga Raya Blok P No.22C RT 001/021 Kel. Bekasi Jl. Kolonel Sugiyono No.3-Wates Jl. Raya Karangnunggal KP.Karangmekar RT/RW 03/09 Desa Hegarwangi Kec. Bantarka- long Kab. Jalan Ahmad Yani No 66, Wonogiri 62265 791560 Jl. Siliwangi No.262, Desa Kawali mukti 6234 1-379840 62324 333905/62324 333906 62287 3878168 6221 62306495 62 21 29364053 62-711-315828 JL. Kawi No.22, Malang, East Java Jl. Kabupaten No.114 Jl. Ahmad Yani No.20, Kubumen Ruko Harco Mangga Dua Blok L. No.5 Jl. Boulevard Barat Ruko MOI Blok I No.15 Jl. Letnan Muthtar Saleh, Kayuagung, Palembang, South Sumatra 62-272-3359557 JL. Pemuda No. 254, Klaten , Central Java 62-343-561-4700 JL.. Pahlawan No 44, Pasuruan, East Java 6229-5410-1614 Jl. Diponegoro No. 53, Pati, Central Java 62-3428-6762234 JI. Trunouyo No. 244 Sumenep 62-266-6249715 Jl. Siliwangi Rt/Rw 02/18, Desa Pelabuhan Ratu 62254-369755 6221-89909797 62264-8220180 6262-576094 62294-644704 Annex Building Lt. 1 Jl. Afrika No.2 Krakatau Posco Cilegon/42435 Ruko Union Square Blok A No.6 Lippo Cikarang, Cikarang Selatan Sadang Terminal Square No.07,08,25 Jl. Raya Sadang Purwakarta/41181 Jl. Raya Cikajang No. 80 Garut Jl. Raya Utama No.9 weleri kendal 62274-3950673 Jl. KH. Agus Salim No.71A Wonosari - Kab Gunungkidul 62281-895553 62271-895015 6221-7374685 6233-54491787 6225-35554739 6231-3503350 6212-9014270 6214-84556 6221-86941678 6221-87735005 6291-4290507 6286-5963716 62-75-321457 6288-34511421 62-271-6882712 6224-76510787 62-21-5421-2159 6222-4211906 62251-8574423 6222-7279740 6221-80876494 62-31-82517971 JL. Letkol Isdiman No. 4, Purbalingga, Central Java Jl. Sukowati No.156 Sragen Jl. Veteran Raya no 42D, Bintaro, South Jakarta Ruko Manunggal No. 2, Jl. Soekarno Hatta Jl. Raya Labuan KM 1 Jl. Pangampon No. 75 Ruko Cikupa Niaga Mas Blok A No. 12 Jl. Jawa Raya Blok A 14 No. 7 (Kawasan Berikat Nusantara) JL. Inspeksi Kali Malang Komplek Billy & moon MLBZ Kav No. 3F, Duren sawit, East Jakarta JL. Raya Lapangan Tembak No. 63 , Cibubur, East Jakarta Jl. Pemuda No. 21 D-E Jl. Letjend S Parman No. 29 JI. Ahmad Yani no.93, Purworejo Jl. Jenderal Ahmad Yani No 26 F Jalan Raya Palur Jurug RT 004/RW 001 Desa Ngringo, Kec. Jaten, Kab. Karanganyar Jl. Diponegoro No. 79 Kelurahan Ungaran, Kecamatan Ungaran Barat, Semarang, Central Java, 50511 Jl. Boulevard Raya Gading Sepong, Ruko Alexandrite 3, No.21, Kabupaten Tangerang Jl Dalam Kaum No. 5 - Kota.Bandung Jl. Sawojajar No.12 B, Kota. Bogor Jl. Citarum No.6, Bandung, West Java Jl. Mayjen Sutoyo No.11 Gedung PT Asabri (persero) Jl. Cililitan - jakarta Timur/13630 Jl. Gayungan PTT, No. 43, Surabaya – 60235, Gedung Kantor Asabri Surabaya STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT060 Phone 95 9 975 890019 95 9 960996083 95 9 960996092 95 9 960996099 95 9 960996089 95 9 961010611 95 9 961010611 95 9 961010511 95 9 950311093 95 9 950311096 95 9 764433931 95 9 764433932 95 9 764433935 95 9 764433936 95 9 780 113417 95 9 780114012 95 9 780114068 95 9 402187901 95 9 402187923 95 9 402187924 95 9 441580466 95 9 441580468 Address No 540, Yadanar Pone 2nd St, Kangyi / Magyi Ward, Kungyangon Township, Yangon, Myanmar Bogyok St. Nyaung Pin Zay Ward, Zalun Township, Ayeyarwady, Myanmar No. 101, Tha Yet Taw(3) Upper St. Tha Yet Taw Ward, Kyimyindaing Township, Yangon, Myan- mar No. 49, U Wisarra St. Pha Tar Gyi Ward, Hinthada Township, Ayeyardady, Myanmar No. 101, Tha Yet Taw(3) Upper St. Tha Yet Taw Ward, Kyimyindaing Township, Yangon, Myanmar No. 93, Nat Maw St. Panbetan Ward, Hinthada Township, Ayeyarwady, Myanmar No. 93, Nat Maw St. Panbetan Ward, Hinthada Township, Ayeyarwady, Myanmar No. 49, Bo Kyoke St. Kon Gyan(Middle) Ward, Twantay Township, Yangon, Myanmar No. 18C, 8th St. 9th Ward, Pyapon Township, Ayeyarwady No. 18C, 8th St. 9th Ward, Pyapon Township, Ayeyarwady No. 1, Sel Myaung St. Myo Kwet Thit 1, Pantanaw Township, Ayeyarwady, Myanmar No. 1, Sel Myaung St. Myo Kwet Thit 1, Pantanaw Township, Ayeyarwady, Myanmar No. 154, Ashay Myopat St. Pan Tin Ward, Gyobingauk Township, Bago, Myanmar No. 154, Ashay Myopat St. Pan Tin Ward, Gyobingauk Township, Bago, Myanmar Hlaing Htate Khaung Tin St. No. 1 Ward, Zigon Township, Bago, Myanmar Plot No. 79, Shwetaung Street, Min Kwet 3, Ward, Paungde Township, Bago, Myanmar Plot No. 79, Shwetaung Street, Min Kwet 3, Ward, Paungde Township, Bago, Myanmar No. 17 Plot, Min Wine Yat, No. 4 Ward, Lewe Township, Nay Pyi Taw, Myanmar No. 181, Yarza Htarni St. Aung Thar Yar Ward, Pobbathiri Township, Nay Pyi Taw, Myanmar No. 181, Yarza Htarni St. Aung Thar Yar Ward, Pobbathiri Township, Nay Pyi Taw, Myanmar No. 241, Office Street, Min Wine Yat, No. 4 Ward, Lewe Township, Nay Pyi Taw, Myanmar Plot No. Da/32470, Yati 14th street, Dekkhinathiri(South)Ward, Dekkhinathiri Township, Nay Pyi Taw 95 9 403663020 No. 241, Office Street, Min Wine Yat, No. 4 Ward, Lewe Township, Nay Pyi Taw, Myanmar 95 9 441473341 95 9 441481276 95 9 893642032 95-9-773579731 No. (ma-127), Yin Mar Street, Area (3), Mya Waddy Ward, Takkon Township, Nay Pyi Taw No. 93, Thatoeminsaw Yat, Aung Zaya Ward, Takkon Township, Nay Pyi Taw No. Ou-1513, Shwe Nant Thar Ward, Ottarathiri Township, Nay Pyi Taw No.52, Apyin Tharzi Street, Tharzi Ward, Nattalin Township, Bago 95-9-692687628 No. 174, Ohntaw No. 2 Ward, Taungdwingyi Township, Magwey 95-9-891504155 No.22, Plot U Paing No.105, East Aung San Ward, Natmauk Township, Magway Company Phone Address 62247-6403870 JL Perintis Kemerdekaan No3. Kel Pudakpayung Kec Banyumanik. Semarang, Central Java Jl. Untung Suropati Ruko Adipura Block A-11 Company Kungyangon Branch Zalun Branch Jl. Raya Darmaraja No.253 desa Darmaraja, Kec Darmaraja Kab.Sumedang/45372 Kyimyindaing Branch Hinthada I Branch Hlaing Branch Hinthada II Branch Hinthada III Branch Twantay Branch Pyapon I Branch Pyapon II Branch Pantanaw I Branch Pantanaw II Branch Gyobingauk I Branch Gyobingauk I Branch Zigon Branch Paungde I Branch Paungde II Branch Lewe I Branch Pyinmana I Branch Pyinmana II Branch Lewe II Branch Dekkhinathiri Branch Lewe Ⅲ Branch TakkonⅠBranch TakkonⅡBranch Ottarathiri Branch Nattalin Branch Taungwingyi Branch Natmauk Branch Asabri Semarang Sub-branch Bojonergoro Sub-branch Darmaraja Sub-branch Jatinangor Sub-branch Jatibarang Sub-branch Kemang Sub-branch Cikande Sub-branch 62-353-311271 62262- 429000,429069,428478 6222-87834401 62834-352911 6221-22716210 6225-47951546 Panglima Cilegon Sub-branch 62254-222133 Kalasan Sub-branch 6227-44332487 6272-5800-1701 62622-7253-499 Pematang Siantar Sub-branch Metro Sub-branch Klungkung Sub-branch Banyuwangi Sub-branch Ponorogo Sub-branch 6235-2359-7288 Jakarta Pusat Sub-branch (Salemba Sub-branch) 6221-2962-7877 Blitar Sub-branch 6234-2818-0338 Rembang Sub-branch Asabri Makassar Sub-branch 6233-3289-1660 6241-1896-1360 6236-6558-2906 6229-5698-4906 JL. Raya Cipacing No. 78, Bandung, West Java Jl. Letnan Joni No.178 Kec. Jatibarang - Kab Indramayu/45273 Kemang Square Lt 2, Unit I-11 & I-12, Jl. Kemang Raya No. 3 A Jl. Raya Jakarta - Serang KM 68, Ruko Grand Permata No. 10 Jl. Raya Serang- pandeglang KM 11 Lingkungan waru Lor,Desa/kel. Kamanisa Kec Curug Kota serang/42117 JL. Laksda Adisucipto KM.10, Ruko Airport Square RT.001 RW.001 Purwomartani, Kalasan, Sleman, D.I Yogyakarta 55281 Jl. Sangnawukuh blok A-40 Kompek Megaland, Pemantang Siantar, North Sumatra JL. Jend. Sudirman No. 78F, Metro, Lampung JL. Diponegoro No.45, Klungkung, Bali JL. S. Parman No. 111, Banyuwangi, East Java JL. Soekarno Hatta No. 222, Ponorogo Jl. Salemba Raya No. 22, District Senen, Central Jakarta Jl. Tentara Genie Pelajar No.4, District Pare, Kediri, East Java Jl. Jendral Sudirman No. 158, District Rembang, Central Java Jl. 1896. P Pettarani No. 21, Tamamaung, Panakkukang, Kota Makassar, Sulawesi Selatan. Hong Kong Woori Global Markets Asia Limited 852-3763-0888 Rooms 1907-1909, 19/F, Gloucester Tower, The Landmark, 15 Queen's Road Central, Hong Kong Russia AO Woori Bank AO Woori Bank Saint-Petersburg Br. AO Woori Bank Vladivostok Representative Office 7-495-783-9787 7-812-327-9787 7-423-240-7014 Brasil 8th floor., Lotte Plaza, 8, Novinsky Boulevard, Moscow, 121099, Russia 1st Floor, Atlantic City, 126 Savushkina Street, Saint-Petersburg, 197374, Russia Vladivostok Business-Center Office No. 614, 29, Semenovskaya Str. Vladivo- stok, 690091, Russia Woori Bank Brasil 55-11-3511-3300 Woori Bank Brasil Bom Retiro Branch 55-11-3511-3350 Avenida das Nacoes Unidas, 14,171, Crystal Tower, Conj.803, Vila Gertrudes, 04794-000, Sao Paulo-SP,Brasil Rua Tres Rios, 261 Andar 2, Bom Retiro, Sao Paulo SP, Brasil Myanmar Woori Finance Myanmar Plc. Mingaladon I Branch NorthOkkalapa Branch Mingaladon II Branch Nyaungdon Branch Taikkyi Branch Hmawbi I Branch Hmawbi II Branch Maubin I Branch Maubin II Branch Kawhmu Branch Insein Branch 95-99-6889-2300 No. M(56), Thiriyadanar Wholesale Market NorthOkkalapa Township, Yangon, Myanmar 95-1-643798 4F, 115/A Pyay Road, Saw Bwar Gyee Kone Ward(10miles), lnsein Township, Yangon Myanmar 95-99-7674-7709 Room No. 103, 1st Street, 5 Quarter, Nyaungdon Township, Ayarwaddy, Myanmar 95-9-7717-81028 Room No.9, Natsinkone Road, Ohtan Ward, Taikkyi Township, Yangon, Myanmar 95-9-974563586 2F No(26) Tatkyee Kone village, Hmawbi Township, Yangon, Myanmar 95-9-97456395 95 9 9712 25895 95 9 9616 12763 95 9 9742 91112 95 1 643798 1F No(26) Tatkyee Kone village, Hmawbi Township, Yangon, Myanmar Plot No(34), No(396), Building 01, Yei Le road, Ward 7, Maubine Township, Ayeyarwaddy, Myanmar (2F) Plot No(34), No(396), Building 01, Yei Le road, Ward 7, Maubine Township, Ayeyarwaddy, Myanmar (1F) No 192/B, Bogyoke St. South Wd Kawhmu Townshop, Yangon 115/A, Pyay Road, Saw Bwar Gyee Kone Ward(10 miles), Insein Township Yangon, Myanmar 95-01-643798 95-01-643798 115/A, Pyay Road, Saw Bwar Gyee Kone Ward(10 miles), Insein Township Yangon, Myanmar 115/A, Pyay Road, Saw Bwar Gyee Kone Ward(10 miles), Insein Township Yangon, Myanmar LUCENA PACIFIC MALL BRANCH 63-42-795-3771 Philippines Wealth Development Bank ALABANG BRANCH 63-32-415-5265 63-2-801-5335 ANGELES MARQUEE MALL BRANCH 63-45-624-0072 LEGAZPI PACIFIC MALL BRANCH 63-52-480-0038 TAGUIG MARKET MARKET BRANCH 63-02-889-0275 CEBU AYALA BRANCH CEBU RAMOS BRANCH CEBU CARBON BRANCH CEBU MANDAUE BRANCH CEBU TABUNOK BRANCH CEBU MANDAUE PACIFIC MALL METRO BRANCH 63-32-415-4888 63-32-412-6302 63-32-416-9077 63-343-8144 63-32-239-1072 CEBU MAMBALING BRANCH 63-414-4233 Taft Financial Center, Cardinal Rosales Avenue, Cebu Business Park, Cebu City, Cebu Unit 103, South Center Tower Condominium 2206 Market Street, Madrigal Business Par Alabang, Muntinlupa City Ground Floor , Marquee Mall, Don Bonifacio St., Pulung Maragul Angeles City, Pampanga G/F Expansion II, Pacific Mall Legazpi, Landco Business Park, F. Imperial Street Cor. Cir- cumferential Road, Legazpi City 4500 Ground Floor L 1-26, Pacific Mall, M.L. Tagarao St. Landco Business Park, Brgy. III , Lucena City, Quezon Ground Floor, Play Ground Zone, Metro Market Market Mall, Mckinley Parkway, Fort Bonifa- cio Global City, Taguig City Ground Floor, Taft Financial Center, Cardinal Rosales Avenue, Cebu Business Park, Brgy. Luz, Cebu City Ground Floor, Hilario Chu Bldg., No. 148 F. Ramos St. Santa Cruz, Cebu City Ground Floor, M.C. Briones & Plaridel Sts., Cebu City Ground Floor, G/F Meritz Building, A.C. Cortes Ave. Ibabao, Mandaue City, Cebu Ground Floor, Mandaue Pacific Mall Metro National Highway corner M.B. Fernan Ave. Estancia, Ibabao, Mandaue City, Metro Cebu G/F Metro Store Mambaling, Cebu, N. Bacalso Avenue corner F. Llamas Street, Basak San Nicolas, Cebu City 63-32-272-2955 Ground Floor, AGSy Bldg., National Hi-Way, Tabunok Talisay City, Cebu STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Company Phone Address Company Phone Address 061 TAGBILARAN BANKING CENTER ILOILO BANKING CENTER 63-411-4860 63-338-4419 CAGAYAN DE ORO BANKING CENTER 63-88-856-8974 Ground Floor, No. 15 JS Torralba St., Poblacion 2, Tagbilaran City, Bohol Ground Floor, ACCE Bldg., Mabini Ledesma St., Liberation, Iloilo City Ground Floor, Jammin Lui Bldg., corner A. Velez & Gomez Sts. Poblacion, Cagayan de Oro City, Misamis Oriental Ground Floor, Door 8, 9 & 10 Grand MenSeng Hotel Pichon St., 1-E Poblacion, Davao City, Davao del Sur Real Street Corner Perichon Barangay 54, Tacloban City, Leyte 63-82-225-3318 63-053-832-3436 63-0917-870-7335 Rizal Avenue Extension, East Grace Park, Caloocan 1400, Metro Manila 63-083-250-1238 Gaisano mall, Jose Catolico Sr. Avenue, General Santos City, South Cotabato 63-035-523-5532 1F Jose Building South Road Calindagan, Dumaguete City 63-034-447-0227 Lacson-Luzuriaga Streets, Bacolod City, Negros Occidental 63-0917-870-7390 JC Aquino Ave, corner, Pareja Subdivision, Butuan City, Mindanao 63-054-881-2836 Ground Floor, Super Metro Camarines Sur, Panganiban Drive, Naga City, Casmarines Sur 63-074-665-2394 NRC Building, Abanao Street, Baguio City, Benguet, Cordillera Administrative Region Lucky Chinatown Mall, Reina Regente St. Binondo, Manila, National Capital Region 84-04-7300-6802 34F, Keangnam Landmark 72, E6 Pham Hung Road, Tu Liem District. Hanoi, Vietnam DAVAO BRANCH TACLOBAN BRANCH CALOOCAN BRANCH GENSAN BRANCH DUMAGUETE BRANCH BACOLOD BRANCH BUTUAN BRANCH NAGA BRANCH BAGUIO BRANCH BINONDO BRANCH Vietnam Wooribank Vietnam Hanoi Branch Hochiminh Branch 84-4-3831-5281 84-8-3821-9839 Bac Ninh Branch 84-22-2390-8460 Hai Phong Branch 84-255-730-0101 Thai Nguyen Branch 84-208-730-0010 Binh Duong Branch 84-274-222-2631 Phu My Hung Branch 84-28-7303-0510 Dong Nai Branch 84-251-730-0370 Ha Nam Branch Da Nang Branch 84-266-730-0020 84-236-730-0321 Bien Hoa Branch 84-251-730-0270 Sai Gon Branch 84-28-7300-2710 Vinh Phuc Branch 84-211-730-0010 Hoan Kiem Branch 84-24-3204-5203 Samsung Electronics Transaction Office 84-22-2369-9431 Trang Due Transaction Office 84-22-5730-4868 Vinhomes Central Park Transaction Office 84-28-3535-4900 Charmvit Tower Transaction Office 84-24-7306-9568 Ha Dong Transaction Office 84-24-7302-1899 24F, Keangnam Landmark 72, E6 Pham Hung Road, Tu Liem District. Hanoi, Vietnam No. 7,8,9, 2nd Floor, Mplaza Saigon, 39 Le Duan St., Ben Nghe Ward, Dist. 1, HCMC, Viet- nam 1st and 3rd Floor, Vincom plaza Bac Ninh, Ly Thai To Street, Suoi Hoa Ward, Bac Ninh City, Bac Ninh Province, Vietnam NO. 4, Lot 22A, Le Hong Phong Street (Cat Bi Airport New Urban Area), Dong Khe Ward, Ngo Quyen District, Hai Phong City, Vietnam 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 10th Floor, Becamex Building, No.230, Binh Duong boulevard, Thu Dau Mot City, Binh Duong Province, Vietnam Unit SA-01, Riverpark Residence Complex, 341 Ha Huy Tap Street, Tan Phong Ward, District 7, Ho Chi Minh City, Vietnam Ton Duc Thang road, Nhon Trach 3 Industrial Zone, Phase1, Hiep Phuoc, ward, Nhon Trach district, Dong Nai Provincem Vietnam 1st and 2nd floor, Tien Loc Building, Commercial Service Zone 4, Thanh Chau ward, Phu Ly City, Ha Nam Province, Vietnam 2nd floor, Phi Long Technology Building, 52 Nguyen Van Linh Road, Nam Duong Ward, Hai Chau District, Da Nang City, Vietnam 5th Floor, Sonadezi Building, No 1, Road 1, Bien Hoa 1 Industrial Zone, An Binh Ward, Bien Hoa City, Dong Nai Province, Vietnam Ground floor and 8th Floor, E-Town 1 Building, no. 364 Cong Hoa St. Ward 13, Tan Binh District, Ho Chi Minh City, Vietnam 1st and 2nd Floor, Bao Quan Hotel, 396 Me Linh Street, Lien Bao ward, Vinh Yen City, Vinh Phuc Province, Vietnam 1st and 5th Floor, Asia Tower Building, No.6, Nha Tho street, Hang Trong ward, Hoan Kiem district, Hanoi city, Vietnam 1st and 2nd Floor, Halla building, Lot CC2, Yen Phong Industrial Zone, Yen Trung Commune, Yen Phong District, Bac Ninh Province, Vietnam 1F, Youngjin E&C Vina Hai Phong, Lot CC3-2.1, Trang Due Industrial Park Phase 2, Hong Phong Commune, An Duong District, Dinh Vu - Cat Hai Economic Zone, Hai Phong City, Vietnam P6-0.14 Park 6 (P6 SH.07), Vinhomes Central Park, 720A Dien Bien Phu Street, 22 Ward, Binh Thanh District, Hochiminh City 01st Floor, Grand Plaza Shopping Center Building, No 117 Tran Duy Hung, Trung Hoa Ward, Cau Giay District, Hanoi Part of Ground Floor of V2, V3 Building, Van Phu Victoria – CT9, Van Phu New Urban Area, Phu La Ward, Ha Dong District, Hanoi Thao Dien Transaction Office 84-28-3636-9280 01-TMDV Luxury Apartments, No.179 Xa Lo Ha Noi Street, Thao Dien Ward, Thu Duc City, Ho Chi Minh City Cambodia WOORI BANK (CAMBODIA) PLC. 023963333 Phnom Penh Head Office Kandal Regional Office Sa'ang Branch Office Kien Svay Branch Office Kandal Stueng Branch Office Leuk Daek (Kampong Phnom) Branch Office Prey Veng Branch Office Sithor Kandal Branch Office 023969269 087777525 087777993 087800578 087777132 087777279 010855644 010855492 0886450320 0889204613 010855188 Svay Rieng and Svay Chrom Regional Office 068855973 Preah Sdech Branch Office 0889201571 Kampong Trabaek Branch Office Mesang Branch Office Chantrea Branch Office Romeashek Branch Office Kampong Rou Branch Office Rumduol Branch Office Takeo Regional Office Bati Branch Office Tramkok Branch Office Kirivong Branch Office Koh Andaet Branch Office Samraong Branch Office Prey Kabas Branch Office 060855699 060855886 060855822 087555395 0884839711 060855213 0888551219 0884831787 0889204641 0884839823 Kampot (Chhouk) Regional Office 0974855014 Banteay Meas Branch Office Angkor Chey Branch Office 0884844237 060855085 Kampong Trach Branch Office 060855075 Kampong Som Branch Office Srae Ambel Branch Office Basedth Branch Office 068855997 087555484 0884874229 Kampong Speu Regional Office 066746666 Korng Pisey Branch Office 068855662 Ponhea Lueu Tumnob Thum Branch Office 068855991 Odongk Krang Chek Branch Office 060855995 Thporng Branch Office Oral Branch Office Phnum Sruoch Branch Office Tuek Phors Branch Office 087555484 066574593 087777010 0884837957 Kampong Chhnang Regional Office 0974855006 Buliding 398, Preah Monivong Blvd, Sangkat Boeun Keng Kang 1, Khan Chamkarmon, Phnom Penh 12302, Kingdom of Cambodia Lot No. 398, Monivong Blvd., Sangkat Beung Keng Kang 1, khan Chamkar Mon, Phnom Penh. No. 240, National Road No. 2, Krapeu Ha Village, Sangkat Prek Ruessey, Ta Khmau Munici- pality, Kandal Province National Road no.21, Preaek Run village, Preaek Koy commune, S'ang district, Kandal province National road No 1, Phumi Boeng Chhuk, Sangkat Nirouth, Khan Chbar Ampov, Phnom Penh #86, National Road no. 2, Preaek Roka village, Preaek Roka Commune, Kandal Stueng district, Kandal province National Road No. 1, Ampil Tuek village, Kampong Phnum commune, Leuk Daek district, Kandal province National Road No 11. Village 8, Sangkat Kampong Leav, Prey Veng city, Prey Veng province Preaek Sandaek Village, Preaek Changkran Commune, Sithor Kandal District, Prey Veng Province Keansang Village, Svay Rieng Commune, Svay Rieng City, Svay Rieng Province Krasang Tong village, Angkor Reach commune, Preah Sdach district, Prey Veng province Doun Tong village, Prasat commune, Kampong Trabaek district, Prey Veng province Vang Villege Chiphouch Commune, Mesang District, Prey veng Provinece, Thnal Cheat Village, Sangkat Chrok Mates, Bavith City, Svay Rieng province, Tatrav Village, Kampong Trach Commune, Romeashek District, Svayreing province, Rou Village, Nhor Commune, Kampong Rou District, Svay Reang Province Chak Village, Kampong Chak commune Rumduol District Svay Rieng Province National Road 2, Phum Thnal Baek, Sangkat Roka Krau, Krong Doun Kaev, Takeo Province National Road no. 2, Smau Khnhei village, Trapeang Sab commune, Bati district, Takeo province Prey Rumdeng Village, Angk Ta Saom Commune, Tram Kak District, Takeo province Po Khvet Village, Phrah Bat Choan Chum Commune, Kirivong District, Takeo Province Prey Malong Khang Tbong Village, Prey Khla commune, Koh Andaet district, Takeo province Krang Lang Village, Cheung Kuon Commune,Samraong District, Takeo province Lvea Tnaot Village, Prey Lvea Commune, Prey Krabbas District, Takeo Province National Road no. 3, Damnak Toap Khang Tboung village, Krang Snay commune, Chhuk district, Kampot province Samrong village, Samrong Krom commune, Banteay Meas district, Kampot province Pral Village, Tani Commune, Angkor Chey District,Kampot Province Kampong Trach Ti Muoy Village, Kampong Trach Khang Kaeut Commune, Kampong Trach District, Kampot Province Village no. 03, Sangkat Lak 02, Quarter, Metapheap Ward, Preah Sihanouk City Plot No. 449, Trapeang Village, Srae Ambel Commune, Srae Ambel District, Koh Kong Province Slab Leaeng village, Svay Rompea commune, Basedth district, Kampong Speu province # 85, national road #04, Borei Kammeakkar Village, Rokar Thum Commune/Sangkat, Chbar Mon Municipality/District/Khan, Kampong Speu Province Tuol Ta Sokh Village, Saen Die Commune, Samraong Tong District, Kampong Speu Province Srae Ta Meaeng Village, Tumnob Thum Commune, Ponhea Lueu District, Kandal Province Krang Chongruk Village, Krang Chek Commune, Odongk District, Kampong Speu Province Anlong Chrey Village, Prambei Mum Commune, Thpong District, Kampong Speu Province Phsar Kontourt village, Sangkea Sartorb Commune, Oral district, Kampong Speu province. Krang Khcheay village, Tang Sya commune, Phnum Sruoch district, Kampong Speu province Srae Ta Chey Vallage, Akphivoadth Communce, Tuek Phos District, Kampong Chhnang Province National Road no.5, Tuol Kralanh village, Sangkat Kampong Chhnang , Kampong Chhnang city, Kampong Chhnang province STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Company Phone Address Company Phone Address 062 Kampong Leaeng Branch Office 090855763 Kampong Tralach Branch Office Boribour Branch Office Pursat Branch Office Krakor Branch Office Phnum Kravanh Branch Office Veal Veaeng Branch Office 090855820 0886007498 0886007540 0884838011 0884845057 0884845556 Kampong Thom Regional Office 067855333 Kampong Boeng village, Kampong Hau commune, Kampong Leng district, Kampong Chhnang province Soben Village, Peani Commune, Kampong Tralach District, Kampong Chhnang Province Cheung Khnar Village, Ponley Communce, Boribour District, Kampong Chhnang Province #475, National Road 5, Krang Pophleak Village, Svay At Commune, Pursat District, Pursat province National Road 5, Phsar village, Anlong Tnaot commune, Krakor district, Pursat province Pich Ban Village, Leach Commune, Phnum Kravanh District, Pursat Province Pramaoy village, Pramaoy commune, Veal Veaeng district, Pursat province House #009 Group 01 National Road no. 6, Stueng Saen Village, Sangkat Kampong Krabao,Stoung Sen City and Kampong Thom Province Romlong Branch Office 060855388 Rom Chek Village,Treal Commune, Baray District, Kompong Thom Province, National Road no. 6, Leap Tong village, Kampong Chen Tboung commune, Stoung district, Kampong Thom province Prey Ta Trav Village, Ballangk Commune, Baray District, Kompong Thom Province Toekmleang village, Sandan commune, Sandan district, Kampong Thom province Sambo Village ,Sambo commune, Prasat Sambour district, Kampong Thom province Thnol Bek Lech Village, Svay Tearb Commune, Chamkar Loeu District, Kampong Cham Province. #99, No. 03, Mphey Osakphea village, Sangkat Svay Pao, Battambang city, Battambang province Banan Village Kantueu Pir Commune, Banan District, Battambang Province #34, Sdau village, Sdau Commune, Rotonak Mondol distrcit, Battambang province Pou Muoy Village,Kear Commune, Moung Ruessei District, Battambang Province Paoy Paet Branch Office Thma Puok Branch Office Bavel Branch Office Phnom Proek Branch Office Siem Reap Regional Office Puok Branch Office Srey Snom Branch Office Angkor Chum Branch Office Samraong Chong Kal Branch Office Chi Kraeng Branch Office 010855492 0884839749 090281942 090855342 0884845477 0884836879 060270442 0713339463 087666741 087555484 Preah Netr Preah Branch Office Phnom Penh (Tuol Kork) Regional Office 090855995 0719833384 Stueng Mean Chey Branch Office 087888277 Ponhea Lueu - Vihear Luing Branch Office 0884843228 Mukh Kampoul Branch Office Khsach Kandal (Preaek Tameak) Branch Office Svay Pak Branch Office 0884842169 087088019 0884845604 Khnach Romeas Village, Beung Khnar Commune, Bakan District, Pursat Province Pur SenChey - Chaom Chau 3 Branch 087555484 O'Tapuk Le village, Pailin commune, Pailin city, Pailin province Ou Tontuem village, Ta sanh commune, Samlout district, Battambang province Dong Village, Boeng Reang Commune, Kamrieng District, Battambang Province Lor Et village, Sangkat Kampong Branak, Preah Vihea city, Preah Vihea province Kuleaen Tboung Village, Kuleaen Tboung Commune, Kuleaen District, Preah Vihear Province Tbeang Village, Chamraeun commune, Sangkom Thmei district, Preah Vihear province Tang Trak Village, Robieb commune, Rovieng District, Preah Vihear Province Trapeang Prasat Village, Trapeang Prasat commune, Trapeang Prasat District, Oddar Meanchey Province Choam Ksant Village, Choam Ksant Commune, Choam Ksant District, Preah Vihear Province National Road 7, village Boeng Snay, Kampong Cham city, Kampong Cham province Doun Die village, Chrey Vean commune, Prey Chhor district, Kampong Cham province Tnaot Ta Say Village, Preak Kak Commune, Stueng Trang District, Kampong Cham Province. Chruoy Changvar Branch Office 0884841986 Srey Sonthor Branch Office Ratanakiri Regional Office Stoeung Treng Branch Office Kaoh Nheaek Branch Office Bar Kaev Branch Office Mondul Kiri Branch Office Kampot Branch Kamchaymear Branch Thmakoul Branch 0884845245 0884830845 0713261010 0713260707 0713492929 0978550241 855-68-435555 855-10-855747 855-69-855755 Prey Kri Tboung Village, Prey Kri Commune, Chol Kiri District, Kampong Chhnang Province Khemarak Phoumin Branch 855-88-8558025 National Road no. 7, Cheung Lang village, Sangkat Suong, Suong city, Kampong Cham province Phsar Thmey Village, Pearm Pror Thnours Commune, Koh Sotin District, Kampong Cham Prov- ince Kandaol Kaong Village, Kaong Kang Commune, Ponhea Kraek District, Tboung Khmum Provinc Oreussey Village, Kratie Ward, Kratie City, Kratie Province, Chrouy Thma Kraom village, Chhloung commune, Chhloung district, Kratie province Kbal Snuol Village, Snuol Commune, Snuol District, Kratie Province Ou Arm Village, Sre Khtom Commune, Keo Sema District, Mondol Kiri Province National Road no. 73,Thnal village, Dambae commune, Dambae district, Kampong Cham province Cheungprey Branch Krolkor Branch Peraing Branch Prey Nop Branch Baphnom Branch Koh Thom Branch Chamkarmon Branch Russey Keo Branch 855-97-6447373 855-87-666945 855-81-709967 855-68-855997 855-93-855773 855-87-777985 855-23-999-661 855-23-999-664 Memot Branch Office 0884381224 Masin Tuek Village, Memot Cummune, Memot District, Kampong Cham Province Banteay Mean Chey Regional Office 060855567 Phumi Kourothan, Sangkat Ou Ambel, Serei Saophoan Municipality, Banteay Meanchey Province. Pursenchey Branch 855-23-999-803 Stoung Branch Office Baray Branch Office Sandan Branch Office Prasat Sambour Branch Office Chamka Loeu Branch Office Battambang Regional Office Banan Branch Office Ratanak Mondul Branch Office Moung Ruessei Branch Office Bakan Branch Office Pailin Branch Office Samlout Branch Office Kamrieng Branch Office Preah Vihear Regional Office Kuleaen Branch Office Sangkum Thmey Satellite Office Rovieng Branch Office Trapaing Prasat Branch Office Choam Khsant Branch Office Kampong Cham Regional Office Prey Chhor Branch Office Stoeung Trang Branch Office Chol Kiri Branch Office Tbong Khmom Branch Office Koh Sotin Branch Office Ponhea Kraek Branch Office Kratie Regional Office Chhloung Branch Office Snuol Branch Office Keo Sema Branch Office Dambae Branch Office 0884836778 060855148 0884827690 0884836883 0888472236 066855022 010855775 010855977 069855585 0886007538 0884873724 0884873767 090309180 0884488844 090855156 060855749 0884845242 0884845248 0975578782 0884840089 0884842218 0884842804 087777151 0886007526 0883031098 068855962 0888848041 0888816546 0884818019 0884818026 0884843373 Oh Chrov village, Paoy Paet District, Paoy Paet Municipality, Banteay Meanchey Province Kasen village, Thma Puok commune, Thma Puok district, Bantey Mean Chey province #15, st. Aksor Te, Bavel 1village, Bavel commune, Bavel district, Battambang province Phnum Toch village, Pech Chenda commune, Phnum Proek district, Battambang province #76, National Road no. 6, Chong Kao Sou village, Sangkat Slor Kram, Siem Reap city, Siem Reap province Puok Chas Village, Puok Commune, Puok District, Siem Reap Province Chroy Neang Nguon village, Chroy Neang Nguon commune, Srey Snam district, Siem Reap province Pram Damloeng Village, Ta saom Commune, Angkor chum District, Sirem reap Province at Doun Kaen Village, Samraong Commune, Samraong District, Oddar Meanchey province National Road No. 6, Kampong Kdei Muoy Village, Kampong Kdei Commune, Chi Kraeng District, Siemreap Chob Village, Chob Veari Commune, Preah Netr Preah District, Banteay Meanchey Province #152B2, St 516, 13 Village, Sangkat Boeung Kork 1, Khan Toulkork, Phnom Penh. No. 19 and 21 EoE1, Street Veng Sreng, Group 1, Ruessei .... Commune, Sangkat Stueng Mean Chey, Khan Mean Chey, Phnom Penh #87, National Road No. 5, Tep Pranom village, Vihea Luong commune, Ponhea Lueu district, Kandal province La Edth Village, Preaek Dambang Commune, Mukh Kampul District, Kandal Province House No 76, Road No.380, Preaek Lvea Village , Preaek Ta Kov Commune , Khsach Kandal District, Kandal Province. National Road No. 5, Lu Village Svay Pak, Khan Russey Keo, Phnom Penh No. 295, National Road No. 4, Chumpu Voan 2 Village, Sangkat Chaom Chau 3, Khan Pur Sen Chey, Phnom Penh lot No. A-01, Street 6A, Phum 3, Sangkat Chrouy Chang Var, Khan Chroy Chang Var, Phom Penh City Santey village, Preaek Po commune, Srey Sonthor district, Kampong Cham Chey Chumnas Village, sangkat Labanseak, City Banlung, Ratanakiri Province Spean Thmor Village, Stoeung Treng Commune, Stoeung Treng District Stoeung Treng Province Reangsei Village, Srae Sangkum Commune, Kaoh Nheaek District, Mondul Kirni Province, Phum Muoy, La Minh Commune, Bar Kaev District, Ratanak Kiri Province Kandal Village, Spean Mean Chey Commune, Saen Monourom municipality, Mondul Kiri Province Kampong Bay Khang Cheung Village, Kampong Bay Sangkat, Kampot City, Kampot Province National Road No. 8, Tean Phleung Village, Smaong Khang Cheung Commune, Kamchay Mear District, Prey Veng Province National Road No. 5, Paoy Yong Village, Ta Pung Commune, Thma Koul District, Battam- bang Province Street Khemara Phoumin, Group 7, Phum Ti Pir Village, Sangkat Smach Mean Chey, Khe- mara Phoumin Municipality, Koh Kong Province National Road No.6 Skon Village, Soutlib Commune, Cheung Prey District, Kampong Cham Province St 1 Thlok Village, Kraol kou Commune, Svay Chrum District, Svay Rieng Province National Road No.8, Snay Pol Village, Roka Commune, Pea Reang District, PreyVeng Provice Road No.4 Veal Meas Village, Veal Renh Commune, Prey Nop District, Preah Sihanouk Province #022 St317 Chheu Kach Village, Chheu Kach Commune, Ba phnom Distirict, Prey Veng Province Kampong Svay Kraom Village, Preaek Thmei Commune, Koh Thom District, Kandal Province Building No. 119B, Street271, Sangkat Phsar Doeum Thkov Khan Chamkarmon, Phnom Penh. House No 1A, National Road 5, Phum Kraol Kou, Sangkat Kilomet Lekh Prammuoy, Khan Russey Keo, Phnom Penh. House No 6A, Russian Federation Blvd, Phum Ta Ngoun, Sangkat Kakab, Khan Pur Senchey, Phnom Penh. STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENT Company Phone Address Woori Card (Tutu Finance_WCI Myanmar) 063 House No. 330, National Road 1, Toul Tnaot village, Korkir Communce, Kien Svay district, Kandal province Building No. 31, National Road 2, Ta Khmau village, Sangkat Ta Khmau, Krong Ta Khmau, Kandal Province. National Road 5, Phum Kandal, Sangkat Preaek Phnov, Khan Preae Phnov, Phnom Penh. House No 183, National Road 4, Trapeang Krasang Village, Baek Chan Commune, Angk Snuol District, Kandal Province. House No 138D, St 215, Sangkat Veal Vong, Khan Prampir Meakkakra, Phnom Penh House No 76, Road No.380, Preaek Lvea Village , Preaek Ta Kov Commune , Khsach Kandal District, Kanda! Province. House No 154, National Road 21, Preaek Khsev Village, Rokar Khpos Commune, S'ang District, Kandal Province. House No 19A, Samdech Preah Monireth Blvd, Phum Domnak Thum, Sangkat Stueng Meanchey 2, Khan Meanchey, Phnom Penh House No 4A, Veng Sreng Blvd, Phum Chrey Kaong, Sangkat Chaom Chau 2, Khan Pur Senchey, Phnom Penh House No 610B, National road No 1, Deum Slaeng Village, Sangkat Chbar Ampov Ti Pir, Khan Chbar Ampov, Phnom Penh House No 1C, St 355, Phum 1, Sangkat Boeng Kak Ti Muoy, Khan Tuol Kouk, Phnom Penh House No 2039, St 217, Ta lei Village, Sangkat Dangkao, Khan Dangkao, Phnom Penh House No 751, National Highway No 4, Chambak Village, Voa Sar Commune, Samraong Tong District, Kampong Speu Province. House No. 11, Phnom Penh-Hanoi Friendship Blv (1019), Roung Chakr Village , Sangkat Kouk Kleang, Khan Saensokh, Phnom Penh. Land No. 5, St. 38, Svay Ming Village, Barku Commune, Kandal Stueng District, Kandal Province National Road No. 5, Mlu Meun Village, Phsar Daek Commune, Ponhea Lueu District, Kandal Province House No 271, National Road 6A, Kraom Village, Preaek Anhchanh Commune, Mukh Kam- pul District,Kandal Province. # 70 Eo, Street 136, Phum 1 , Sangkat Phsar Thmei Ti Bei, Khan Doun Penh, Phom Penh # 131, Samdech Monireth Blvd. (St. 217), corner of St. 310, Phum 10, Sangkat Tuol Svay Prey Ti Pir, Khan Boeng Keng Kang, Phnom Penh No. 387, Preah Sisovath Blvd, Sangkat Chey Chummeah, Khan Doun Penh, Phnom Penh. Building No. 104, Russian Federation Blvd, Sangkat Tuek Thla, Khan Saensokh, Phnom Penh Capital Head Office Room 8, Block 6, Mingalar Mandalay, Between Thazin Street and Ngu Shwe Wah Street, 73rd Street, Chanmyatharsi Township, Mandalay Phone: +95-22000219 Overseas Office PT Woori Finance Indonesia Tbk(Operate 72 networks) Chase Plaza Lantai 12 & 15 Jl. Jend Sudirman Kav. 21, Jakarta Indonesia Woori Asset Management Overseas Office Woori Asset Management Ho Chi Minh Office 615-4, 6FLOOR ME LINH POINT TOWER, 2 NGO DUC KE ST, DIST.1, HCMC, VIETNAM Phone: (84-28-3520-2811 Woori Venture Partners Overseas Office Woori Venture Partners Singapore Br. 1 Raffles Quay #09-02 North Tower Singapore 048583 Kean svay Branch 855-23-720-632 Takhmao Branch PrekPhnov Branch Ang Snoul Branch Phsar Depo Branch AreyKshat Branch 855-24-998-333 855-23-900-345 855-023-999-355 855-23-900-455 855-24 900-488 S'ang Brancch 855-24 901-455 Steung Meanchey Branch 855 23 901 345 Pur SenChey - Chaom Chau 2 Branch 855 23 901 355 Char Ampov Branch Toul Kork Branch Chamkar Doung Branch Kampongspeu Branch Pshar Dey Huy Branch Kandal Stueng Branch Odongk Branch Mukh Kampul Branch Phsar Thmei Ti Bei Branch 855 023 999 026 855 023 999 025 855 023 999 027 855 025 900 555 855 023 900 466 855 024 900 066 855 024 900 077 855 024 900 099 855 089 767 579 Tuol Svay Prey Ti Pir Branch 855 098 786 996 Doun Penh - Chey Chummeah Branch(Riverside) Saensokh - Tuek Thla Branch Europe Woori Bank Europe Woori Bank Europe GmbH Hungary Repre- sentative Office Overseas Office +49(0)69 299 254 0 MesseTurm, 29th floor, Friedrich-Ebert-Anlage 49, 60308, Frankfurt am Main, Germany Phone: (84-28)-3520-2811 Woori Venture Partners Shanghai Office. Room 2806, L'Avenue 99 Xianxia Road, Changning Districe, Shanghai (200051) Phone: 86-216-067-1778 Woori Venture Partners US 350 Cambridge Ave. Suite 350, Palo Alto CA 94306 Phone: 1-650-324-4681 Company Phone Address Woori Bank Kuala Lumpur Representative Office 60-3-2163-8288 Woori Bank Yangon, Myanmar Office Woori bank Iran Representative Office Woori Bank Poland Representative Office 48-323-076-417 95-01-646951 32F, Menara Prestige, Jalan Pinang, 50450, Kuala Lumpur, Malaysia No.115(A) First Floor), Pyay Road, 10 Miles, Insein Township, Yangon, Myanmar Dormant Uniwersytecka 13, 40-007, Katowice, Poland STRATEGY REPORTWOORI OVERVIEWESG REPORTBUSINESS REPORTAPPENDIXFINANCIAL STATEMENTWOORI FINANCIAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 WOORI FINANCIAL GROUP INC. Page(s) Independent Auditor’s Report…..………...................................................... 1-5 Consolidated Financial Statements Consolidated Statements of Financial Position............................................... Consolidated Statements of Comprehensive Income....…...…………..……… Consolidated Statements of Changes in Equity.............................................. 7 8-9 10 Consolidated Statements of Cash Flows………………………..……............... 11-12 Notes to the Consolidated Financial Statements……...……………...…… 13-195 - 2 - Independent Auditor’s Report (English Translation of a Report Originally Issued in Korean) To the Board of Directors and Shareholders of Woori Financial Group Inc. Opinion We have audited the accompanying consolidated financial statements of Woori Financial Group Inc. and its subsidiaries (collectively referred to as the “Group”), which comprise the consolidated statements of financial position as at December 31, 2022 and 2021, and the consolidated statements of comprehensive income, consolidated statements of changes in equity and consolidated statements of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2022 and 2021, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (Korean IFRS). Basis for Opinion We conducted our audits in accordance with Korean Standards on Auditing. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the ethical requirements of the Republic of Korea that are relevant to our audit of the consolidated financial statements and we have fulfilled our other ethical responsibilities in accordance with the ethical requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Key Audit Matter 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 opinion thereon, and we do not provide a separate opinion on these matters. Expected Credit Losses on Loans Measured at Amortized Cost Why it is determined to be a key audit matter: The impairment guidance under Korean IFRS 1109 Financial Instruments requires determination of significant increases in credit risk and measurement of expected credit losses using forward-looking information and others. Accordingly, the Group developed a measurement model that encompasses probability of default, loss given default and forward-looking information utilizing various types of information, which requires a higher level of management’s interpretation and judgment. The Group measures expected credit losses on loans measured at amortized cost based on both individual and collective assessments. Individual assessment of expected credit losses is performed based on estimation of future forecast cash flow with a relatively high degree of management’s - 1 - estimation and judgment, and collective assessment of expected credit losses involves a variety of complex variables and assumptions that require management’s estimation and judgment. Due to these facts, expected credit losses of loans measured at amortized costs are determined as a key audit matter. As described in Note 10, loans measured at amortized cost subject to individual or collective assessments amount to 346,252,713 million won, with allowances for credit losses of 2,334,153 million won as of December 31, 2022. Significantly affected subsidiary is Woori Bank. How our audit addressed the key audit matter: (1) Assessment of expected credit losses on an individual basis We obtained an understanding and evaluated the processes and controls relating to the assessment of expected credit losses on an individual basis. In particular, we focused our effort on the assumptions used in estimating future cash flows. We evaluated whether management’s estimation was reasonable and we assessed the key assumptions in the cash flow projection including growth rate of entities subject to individual assessment and collateral valuation. As part of these procedures, we assessed whether sales growth rate, operating income ratio, and assumptions on investment activities were consistent with historical operating performance and current market conditions. Additionally, we assessed the appropriateness of collateral valuation by conducting our own research on recent property prices and engaged independent appraisal specialists in assessing reasonableness of appraisal reports, models and methodologies used by management. (2) Assessment of expected credit losses on a collective basis We obtained an understanding and evaluated the processes and controls relating to management’s calculation of expected credit losses on a collective basis in accordance with impairment requirements under Korean IFRS 1109 Financial Instruments. As explained in Note 2, management assessed credit ratings to recognize lifetime expected credit losses on loans with significant increase in credit risk and impaired loans. Other than these cases, management recognized 12-months of expected credit losses. To calculate expected credit losses, management applied forward-looking information, probability of default and loss given default, etc., estimated through its internal procedures and controls implemented for various assumptions. We assessed the design and operating effectiveness of controls relating to credit ratings that reasonably reflected both qualitative and quantitative information. Our testing over the accuracy and reliability of the information included agreeing qualitative and quantitative information with relevant evidence. We reviewed the appropriateness of management policies and procedures to determine significant increases in credit risk, and tested reasonableness of expected credit loss model applied by each of the three stages(Stage 1, 2 and 3) depending on how significantly credit risk was increased. - 2 - We used risk specialists to test the appropriateness of management's methodologies of reflecting forward-looking information in the estimation of expected credit loss by adjusting the probability of default and loss given default after statistically analyzing the correlation between forward-looking information and probability of default or loss given default. Moreover, we tested the reasonableness and mathematical accuracy of the result through recalculation and examination of supporting data. We reviewed the methodologies used by management to verify that probability of default and loss given default were calibrated using sufficient and reasonable historical data. We determined that the default and loss data used were appropriately gathered and applied in accordance with internal control procedures. In addition, we tested reasonableness and accuracy of probability of default and loss given default through procedures including recalculation, and tested management’s default and loss data by agreeing them with relevant evidence. Furthermore, we tested reasonableness of stage allocation of loans subject to COVID-19 payment relief attributable to significant increase in credit risk. We also tested key assumptions used in calculation of probability of default and required disclosures. We verified accuracy and completeness of aggregation of loans subject to the deferral, and accuracy of calculation of loss allowances. Other Matter Auditing standards and their application in practice vary among countries. The procedures and practices used in the Republic of Korea to audit such consolidated financial statements may differ from those generally accepted and applied in other countries. Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with Korean IFRS, and for such internal control as management determines 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 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. Those charged with governance are responsible for overseeing the Group’s financial reporting process. - 3 - 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 Korean Standards on Auditing 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 Korean Standards on Auditing, 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, 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 entity'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 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 remain solely responsible for our audit opinion. We communicate with those charged with governance 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 with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. - 4 - 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 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 Sung-jae Lim, Certified Public Accountant. /s/ Samil PricewaterhouseCoopers Seoul, Korea March 7, 2023 This report is effective as of March 7, 2023, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying consolidated financial statements and notes thereto. Accordingly, the readers of the audit report should understand that there is a possibility that the above audit report may a to be revised to reflect the impact of such subsequent events or circumstances, if any. - 5 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 The accompanying consolidated financial statements including all footnote disclosures were prepared by, and are the responsibility of, the management of Woori Financial Group Inc. Tae Seung Son President and Chief Executive Officer Main Office Address: (Address) 51, Sogong-ro, Jung-gu, Seoul (Phone Number) 02-2125-2000 - 6 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AS OF DECEMBER 31, 2022 AND 2021 Cash and cash equivalents (Note 2 and 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 (Notes 14 and 18) Premises and equipment (Notes 15 and 18) Intangible assets (Note 16) Assets held for 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 fair value through profit or loss (“FVTPL”) (Notes 4, 11, 12, 20 and 26) Deposits due to customers (Notes 4,11,21 and 41) Borrowings (Notes 4, 6, 11, 12 and 22) Debentures (Notes 4, 6, 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, 6, 11, 12, 25 and 41) Other liabilities (Notes 6, 25 and 41) Total liabilities EQUITY Owners’ equity (Note 28) Capital stock Hybrid securities Capital surplus Other equity Retained earnings Non-controlling interests Total equity Total liabilities and equity December 31, 2022 December 31, 2021 (Korean Won in millions) 34,219,148 20,613,073 19,860,573 13,497,234 33,085,080 28,268,516 355,760,729 1,305,636 387,707 3,142,930 849,114 13,772 319,280 53,274 109,299 37,786 3,061,552 480,474,396 8,952,399 342,105,209 28,429,603 44,198,486 545,865 35,202 843,555 31,799 202,911 22,811,868 690,157 448,847,054 3,640,303 3,112,449 682,385 (2,423,392) 23,750,152 28,761,897 2,865,445 31,627,342 480,474,396 39,119,789 17,086,274 348,885,617 1,335,167 389,495 3,174,720 785,386 26,327 21,346 22,598 31,131 106,764 2,088,950 447,183,871 4,873,458 317,899,871 24,755,459 44,653,864 576,134 47,986 584,491 186,946 27,584 24,171,030 556,853 418,333,676 3,640,303 2,294,381 682,385 (2,167,614) 21,392,564 25,842,019 3,008,176 28,850,195 447,183,871 The accompanying notes are part of this consolidated financial statements. - 7 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 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 (Notes 11, 32 and 41) Net gain on financial instruments at FVTPL (Notes 11, 33 and 41) Net gain(loss) on financial assets at FVTOCI (Notes 11 and 34) Net gain arising on financial assets at amortized cost (Note 11) Impairment losses due to credit loss (Notes 35 and 41) General and administrative expense (Notes 36 and 41) Other net operating expense (Notes 11, 26, 36 and 41) Operating income Share of gain of joint ventures and associates (Note 13) Other non-operating expense Non-operating expense (Note 37) Net income before income tax expense Income tax expense (Note 38) Net income Net gain(loss) on valuation of equity securities at FVTOCI Changes in capital due to equity method Remeasurement gain(loss) related to defined benefit plan Items that will not be reclassified to profit or loss: Net gain(loss) on valuation of debt securities at FVTOCI Changes in capital due to equity method Net gain(loss) on foreign currency translation of foreign operations Net gain(loss) on valuation of hedges of net investments in foreign operations Net gain(loss) on valuation of cash flow hedge Items that may be reclassified to profit or loss: 2022 2021 (Korean Won in millions) 14,654,549 106,698 632,615 13,915,236 (5,957,970) 8,696,579 2,499,700 (789,530) 1,710,170 159,982 238,502 (21,498) 74,204 (885,272) (4,529,890) (1,012,253) 4,430,524 69,996 (15,146) 54,850 9,894,749 45,803 381,814 9,467,132 (2,909,028) 6,985,721 2,171,705 (700,930) 1,470,775 309,211 325,751 32,624 107,317 (536,838) (4,147,411) (887,401) 3,659,749 62,196 27,296 89,492 4,485,374 3,749,241 (1,161,392) (941,870) 3,323,982 2,807,371 (30,146) (4,527) 251,440 216,767 (463,725) 5,139 32,536 (20,701) (9,835) (456,586) 34,069 (2,607) 65,067 96,529 (184,396) 4,133 246,808 - 7,107 73,652 Other comprehensive income (loss), net of tax (239,819) 170,181 Total comprehensive income 3,084,163 2,977,552 (Continued) - 8 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (CONTINUED) Net income attributable to: Net income attributable to owners Net income attributable to non-controlling interests Total comprehensive income attributable to: Comprehensive income attributable to owners Comprehensive income attributable to non-controlling interests Earnings per share (Note 39) 2022 2021 (Korean Won in millions) 3,323,982 3,141,680 182,302 3,084,163 2,909,053 175,110 2,807,371 2,587,936 219,435 2,977,552 2,745,764 231,788 Basic and diluted earnings per share (Unit: In Korean Won) 4,191 3,481 The accompanying notes are part of this consolidated financial statements. - 9 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 January 1, 2021 Total comprehensive income Net income Net gain(loss) on valuation of financial instruments at FVTOCI Net gain(loss) due to disposal of equity securities at FVTOCI Changes in capital due to equity method Gain on foreign currency translation of foreign operations Gain on valuation of cash flow hedge Capital related to non-current assets held for sale Remeasurement gain related to defined benefit plan Transactions with owners Comprehensive stock exchange Dividends to common stocks Acquisition of treasury stocks Issuance of hybrid securities Dividends to hybrid securities Redemption of hybrid securities Changes in subsidiaries’ capital Others December 31, 2021 January 1, 2022 Total comprehensive income Net income Net loss on valuation of financial instruments at FVTOCI Net gain(loss) due to disposal of equity securities at FVTOCI Changes in capital due to equity method Gain(loss) on foreign currency translation of foreign operations Loss on valuation of hedges of net investments in foreign operations Loss on valuation of cash flow hedge Capital related to non-current assets held for sale Remeasurement gain related to defined benefit plan Transactions with owners Dividends to common stocks Issuance of hybrid securities Dividends to hybrid securities Redemption of hybrid securities Changes in subsidiaries’ capital Changes in non-controlling interests related to business combinations December 31, 2022 Capital Stock Hybrid securities Capital surplus Other equity Retained earnings (Korean Won in millions) Owners’ equity in total Non- controlling interests Total equity 3,611,338 1,895,366 626,111 (2,347,472) 19,268,265 23,053,608 3,672,237 26,725,845 - - - - - - - - - - - - - - - - - - - - - - - - - 2,587,936 2,587,936 219,435 2,807,371 (150,470) - (150,470) 143 (150,327) (2,220) 2,472 2,220 (946) - 1,526 - - - 1,526 234,583 6,938 - - 234,583 6,938 12,225 169 246,808 7,107 (947) 947 - - - 65,251 - 65,251 (184) 65,067 28,965 - - - - - - - - - - 399,015 - - - - 3,640,303 2,294,381 35,197 - - - - - 9,382 11,695 - - (368,357) - - (3,819) - - (66,250) - - (27,365) (31,251) 32,445 - 22,990 682,385 (2,167,614) 21,392,564 64,162 (368,357) (3,819) 399,015 (66,250) (27,365) 10,576 34,685 25,842,019 64,162 - (377,748) (9,391) (3,819) - 399,015 - (211,173) (144,923) (577,269) (549,904) (720) (11,296) (180,335) (145,650) 3,008,176 28,850,195 3,640,303 2,294,381 682,385 (2,167,614) 21,392,564 25,842,019 3,008,176 28,850,195 - - - - - - - - - - - - - - - - - - - - - - - - 818,068 - - - - - 3,640,303 3,112,449 - - - - - - - - - - - - - - - 3,141,680 3,141,680 182,302 3,323,982 (493,462) - (493,462) (409) (493,871) 10,254 612 (10,254) - - 612 - - - 612 39,579 (7,043) 32,536 39,579 (20,701) (9,835) - - - (20,701) (9,835) (279) 279 - - - - (20,701) (9,835) - 251,180 - 251,180 260 251,440 - - - (60,491) 27,365 (654,996) - (91,756) - (27,365) (654,996) 818,068 (91,756) (60,491) - (664,945) (9,949) 349,215 1,167,283 (205,751) (620,056) - (113,995) (559,565) - - - 682,385 (2,423,392) 23,750,152 28,761,897 - - 16,453 16,453 2,865,445 31,627,342 The accompanying notes are part of this consolidated financial statements. - 10 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 Cash flows from operating activities (Note 2): Net income Adjustments to net income: Income tax expense Interest income Interest expense Dividend income Additions of expenses not involving cash outflows: Loss on financial instruments at FVTPL Loss on financial assets at FVTOCI Impairment loss due to credit loss Loss on other provisions Retirement benefit Depreciation and amortization Net loss on foreign currency translation Loss on derivatives (designated for hedge) Loss on fair value hedge Loss on valuation of investments in joint ventures and associates Loss on disposal of investments in joint ventures and associates Loss on disposal of premises and equipment, intangible assets and other assets Impairment loss on premises and equipment, intangible assets and other assets Other loss Deductions of income not involving cash inflows: Gain on financial assets at FVTOCI Gain on other provisions Net profit on foreign currency translation Gain on derivatives (designated for hedge) Gain on fair value hedge 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 Other income 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 Interest income received Interest expense paid Dividends received Income tax paid Net cash inflow from operating activities (Continued) 2022 2021 (Korean Won in millions) 3,323,982 2,807,371 1,161,392 (14,654,549) 5,957,970 (159,982) (7,695,169) 941,870 (9,894,749) 2,909,028 (309,211) (6,353,062) 815,706 23,836 885,272 37,493 165,063 929,311 - 250,268 - 28,861 3,690 3,177 260 62,196 3,205,133 2,338 55,327 3,180 71,179 257,910 98,858 599 55,852 310 15,879 561,432 (1,647,572) (5,986,828) (1,314,877) 23,536,088 (24,041) (133,421) (2,514,238) 83,559 11,998,670 14,189,016 (4,965,594) 159,993 (1,030,480) 8,352,935 18,624,119 16,869 15,812 536,838 85,690 177,303 791,896 109,668 93,084 1,947 19,816 174 3,354 656 - 1,853,107 48,436 1,591 - 61,271 106,253 82,012 70,834 51,083 166 35,717 457,363 42,498 (32,419,399) (983,680) 23,830,469 (12,278) (109,778) 9,456,310 67,802 (128,056) 9,351,055 (3,016,841) 309,071 (565,539) 6,077,746 3,799,743 - 11 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021 (CONTINUED) Cash flows from investing activities Cash in-flows from investing activities: Disposal of financial instruments 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 sale Net increase of other assets Cash out-flows from investing activities: Net cash out-flows from obtaining control Acquisition of financial instruments at FVTPL Acquisition of financial assets at FVTOCI Acquisition of securities at amortized cost Acquisition of investments in joint ventures and associates Acquisition of premises and equipment Acquisition of intangible assets Changes in subsidiaries Net cash outflow from investing activities Cash flows from financing activities: Cash in-flows from financing activities: Net cash in-flows from hedging activities Net increase in borrowings Issuance of debentures Net increase of other liabilities Issuance of hybrid securities Paid-in capital increase on non-controlling interests Net increase in non-controlling equity liabilities Cash out-flows from financing activities: Redemption of debentures Redemption of lease liabilities New stock issue cost Acquisition of treasury stocks Dividends paid Redemption of hybrid stocks Dividends paid to hybrid securities Dividends paid to non-controlling interest Changes in non-controlling interests Net cash inflow from financing activities 2022 2021 (Korean Won in millions) ㅜ 9,502,271 21,717,266 5,872,961 249,763 2,061 44,839 978 52,417 62,386 37,504,942 378,394 10,274,187 16,110,501 16,873,194 143,345 172,876 174,749 346,386 44,473,632 (6,968,690) 54,569 2,881,675 23,402,694 513 1,167,283 - 1,847 27,508,581 23,887,568 187,531 - - 654,996 643,000 205,751 9,949 - 25,588,795 1,919,786 10,361,751 21,645,907 6,425,062 195,758 - 2,890 846 93,756 66,305 38,792,275 1,638 11,840,524 30,522,971 6,435,692 400,172 119,255 138,882 - 49,459,134 (10,666,859) 6,987 3,199,712 32,674,966 3,488 399,016 1,623 10,685 36,296,477 25,781,305 177,593 140 3,757 368,357 587,650 211,173 9,391 81,410 27,220,776 9,075,701 Effects of exchange rate changes on cash and cash equivalents 30,860 1,061,251 Net increase in cash and cash equivalents 13,606,075 3,269,836 Cash and cash equivalents, beginning of the period 20,613,073 17,343,237 Cash and cash equivalents, end of the Period (Note 6) 34,219,148 20,613,073 The accompanying notes are part of this consolidated financial statements. - 12 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 1. GENERAL (1) Summary of the Parent company Woori Financial Group, Inc. (hereinafter referred to the “Parent company”) 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 (hereinafter referred to the “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 Parent company is located at 51, Sogong-ro, Jung-gu, Seoul, Korea, and the capital stock is 3,640,303 million won. The Parent 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 between the Parent 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 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 Number of Parent company’s stocks 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., Ltd. and changed the name to Woori Asset Management Corp. Also, as of August 1, 2019, the Parent company gained 100% control of ABL Global 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 Parent 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 Parent company 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. The Parent Company paid 113,238 million Won in cash to acquire 100% interest of Woori Savings Bank from its subsidiary, Woori Financial Capital Co., Ltd., on March 12, 2021. As of August 10, 2021, the Parent company paid 5,792,866 new shares of the Parent company to the shareholders of Woori Financial Capital Co., Ltd. (excluding the Parent company) through comprehensive stock exchange and acquired residual interest (9.5%) of Woori Financial Capital Co., Ltd., to make it a wholly owned subsidiary. As of January 7, 2022, the Parent company established Woori Financial F&I Co., Ltd., an investment company for non-performing loans and restructuring companies (100% interest, 200 billion Won in stock payments) and included it as a subsidiary - 13 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) Details of the Parent company and subsidiaries (hereinafter ‘Group’) as of December 31, 2022 and 2021 are as follows: Subsidiaries Main business Percentage of ownership (%) December 31, 2022 December 31, 2021 Financial statements date of use Location Held by Woori Financial Group Inc. Woori Bank Woori Card Co., Ltd. Woori Financial Capital Co., Ltd. Woori Investment Bank Co., Ltd. Bank Finance Finance Other credit finance business Real estate trust Woori Asset Trust Co., Ltd. Woori Savings Bank (*7) Woori Asset Management Corp. Woori Financial F&I Co., Ltd. Woori Credit Information Co., Ltd. Credit information Financial support Woori Fund Service Co., Ltd. service business Mutual saving bank Finance Finance Woori Private Equity Asset Management Co., Ltd. Woori Global Asset Management Co., Ltd. Woori FIS Co., Ltd. Finance Finance System software development & maintenance Woori Finance Research Institute Co., Ltd. Other service business Held by Woori Bank Woori America Bank(*1) Woori Global Markets Asia Limited Woori Bank China Limited AO Woori Bank (*10) PT Bank Woori Saudara Indonesia 1906 Tbk(*1) Banco Woori Bank do Brasil S.A. Korea BTL Infrastructure Fund Woori Finance Myanmar Co., Ltd. Wealth Development Bank Woori Bank Vietnam Limited Woori Bank (Cambodia) PLC (*9) Woori Bank Europe(*1) Kumho Trust First Co., Ltd. (*2) Asiana Saigon Inc. (*2) KAMCO Value Recreation First Securitization Specialty Co., Ltd. (*2) Deogi Dream Fourth Co., Ltd. (*2) (*5) Jeonju Iwon Ltd. (*2) Wonju I one Inc. (*2) Heitz Third Co., Ltd. (*2) Woorihansoop 1st Co., Ltd. (*2) Woori International First Co., Ltd. (*2) Wibihansoop 1st Co., Ltd. (*2) Woori QS 1st Co., Ltd. (*2) Woori Display 1st Co., Ltd. (*2) (*5) Tiger Eyes 2nd Co., Ltd. (*2) (*5) Woori Display 2nd Co., Ltd. (*2) Woori Dream 2nd Co., Ltd. (*2) Woori H 1st Co., Ltd. (*2) Woori K 1st Co., Ltd. (*2) Woori S 1st Co., Ltd. (*2) Woori Display 3rd Co., Ltd. (*2) TY 1st Co., Ltd. (*2) Woori-HJ 3rd Co., Ltd. (*2) (*5) 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 - 14 - 100.0 100.0 100.0 58.7 67.2 100.0 73.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 84.2 100.0 99.9 100.0 51.0 100.0 100.0 100.0 0.0 0.0 100.0 100.0 100.0 58.7 67.2 100.0 73.0 - 100.0 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 31 100.0 Korea December 31 100.0 Korea December 31 100.0 Korea December 31 100.0 Korea December 31 100.0 Korea December 31 100.0 America December 31 100.0 Hong Kong 100.0 100.0 China Russia December 31 December 31 December 31 84.2 100.0 99.9 Indonesia Brazil Korea 100.0 Myanmar 51.0 Philippines 100.0 Vietnam 100.0 Cambodia 100.0 Germany 0.0 0.0 Korea Korea December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 December 31 15.0 15.0 Korea December 31 - 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 0.0 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 - 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 INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Percentage of ownership (%) December 31, 2022 December 31, 2021 Subsidiaries Woori K 2nd Co., Ltd. (*2) (*5) Woori KC No.1 Co., Ltd. (*2) Quantum Jump the 2nd Co., Ltd. (*2) Quantum Jump the 1st Co., Ltd. (*2) (*5) Woori BK the 1st Co., Ltd. (*2) (*5) Woori-HC 1st Co., Ltd. (*2) (*5) Wivi Synergy 1st Co., Ltd. (*2)(*5) 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) Woori Steel 1st Co., Ltd (*2) SPG the 1st Co., Ltd. (*2) Woori-HWC 1st Co., Ltd. (*2) Woori HC 3rd Co., Ltd. (*2). Woori Park I 1st co., Ltd (*2) Woori DS 1st co., Ltd (*2) Woori HC 4th Co., Ltd. (*2). Woori SKR 1st Co., Ltd. (*2). Woori H chemical 1st Co.,Ltd (*2) HE the 1st Co.,Ltd. (*2) Woori Hub The 1st Co., Ltd. (*2) Woori K The 3rd Co., Ltd. (*2) Woori KF 1st Co., Ltd. (*2) WooriI TS 1st Co., Ltd. (*2) Woori H Square 1st Co., Ltd. (*2) Woori L Yongsan 1st Co., Ltd. (*2) Woori HC 5th Co., Ltd. (*2) Woori Ladena 1st Co., Ltd. (*2) Woori HR 1st Co., Ltd. (*2) Woori Lotte Dongtan 1st Co., Ltd. (*2) Woori HC 6th Co., Ltd. (*2) Woori ECO 1st Co., Ltd. (*2) Woori HO 1th Co., Ltd. (*2) Woori ESG 1st Co.,Ltd. (*2) Woori Osiria 1st Co.,Ltd. (*2) Woori Eco 2nd Co.,Ltd. (*2) Gangnam Landmark 2nd Co., Ltd(*2) Woori HP the 1st co.,Ltd. (*2) G5 Pro Short-term Bond Investment Fund 13 (*3) (*5) Heungkuk Global Private Placement Investment Trust No. 1 (*3) AI Partners UK Water Supply Private Placement Investment Trust No.2 (*3) Multi Asset Global Real Estate Investment Trust No. 5-2 (*3) IGIS Australia Investment Trust No. 209-1 (*3) INMARK Spain Private Placement Real Estate Investment Trust No. 26-2 (*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 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 Securities investment and others Securities investment and others Securities investment and others Securities investment and others Securities investment and others Securities investment and others - 15 - Financial statements date of use - December 31 Location Korea Korea Korea December 31 0.0 0.0 0.0 0.0 Korea 0.0 0.0 Korea Korea 0.0 Korea - - - - 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 0.0 0.0 0.0 - - - - - - Marshall islands 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 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 December 31 December 31 December 31 December 31 December 31 December 31 December 31 - 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 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 - 100.0 Korea - 98.8 98.8 Korea December 31 97.3 99.0 99.4 97.3 England December 31 99.0 Korea December 31 99.4 Korea December 31 97.7 97.7 Korea December 31 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Subsidiaries Main business Woori G Japan General Type Private Real Estate Feeder Investment Trust No.1-2 (*3) IGIS Global Private Placement Real Estate Fund No. 316-1 (*3) Woori G Secondary Private Placement Investment Trust No. 1 (*3) Woori G Japan Blind General Type Private Real Estate Feeder Investment Trust No.1 (*3) JB Airline Private Placement Investment Trust No.8 (*3) Kiwoom Harmony Private Placement Investment Trust No. 2 (*3) Kiwoom Harmony Private Placement Investment Trust No. 1 (*3) Kiwoom Frontier Private Investment Trust No.23[Bond] (*3) Principal Guaranteed Trust (*4) Principal and Interest Guaranteed Trust (*4) 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 Percentage of ownership (%) December 31, 2022 December 31, 2021 Financial statements date of use Location 98.8 98.8 Korea December 31 99.3 99.3 Korea December 31 98.3 98.1 Korea December 31 99.9 97.0 99.8 Korea December 31 97.0 Korea December 31 97.1 97.1 Korea December 31 97.2 96.0 Korea December 31 99.8 0.0 0.0 - 0.0 Korea Korea December 31 December 31 0.0 Korea December 31 Held by Multi Asset Global Real Estate Investment Trust No. 5-2 MAGI No.5 LuxCo S.a.r.l. Held by MAGI No.5 LuxCo S.a.r.l. Asset securitization 54.6 54.6 Luxembourg December 31 ADP 16 Brussels Asset securitization 99.9 99.9 Belgium December 31 Held by Woori Card Co., Ltd. TUTU Finance –WCI Myanmar Co., Ltd. PT Woori Finance Indonesia Tbk. Woori Card 2018-1 Securitization Specialty Co., Ltd. (*2) (*5) Woori Card 2019-1 Asset Securitization Specialty Co., Ltd. (*2) Woori Card 2020-1 Asset Securitization Specialty Co., Ltd. (*2) Woori Card 2021-1 Asset Securitization Specialty Co., Ltd. (*2) Woori Card 2022-1 Asset Securitization Specialty Co., Ltd. (*2) Woori Card 2022-2 Asset Securitization Specialty Co., Ltd. (*2) Woori Card 2023-1 Asset Securitization Specialty Co., Ltd. (*2) Held by Woori Financial Capital Co., Ltd. ACE Auto Invest the 48th Securitization Specialty Co., Ltd. (*2) (*5) ACE Auto Invest the 49th Securitization Specialty Co., Ltd. (*2) (*5) Specified Money Market Trust Finance Finance 100.0 82.0 100.0 Myanmar Indonesia - December 31 December 31 Asset securitization - 0.5 Korea - Asset securitization 0.5 0.5 Korea December 31 Asset securitization 0.5 0.5 Korea December 31 Asset securitization 0.5 0.5 Korea December 31 Asset securitization Asset securitization Asset securitization 0.5 0.5 0.5 - Korea December 31 - Korea December 31 - Korea December 31 Asset securitization - 1.0 Korea - Asset securitization Trust - 100.0 1.0 - Korea Korea - December 31 - 16 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Subsidiaries Main business Held by Woori Investment Bank Co., Ltd. Seari First Securitization Specialty Co., Ltd. (*2) (*5) Asset securitization 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) WS2003 Securitization Specialty Co., Ltd. (*2) WS2006 Securitization Specialty Co., Ltd. (*2) WJ2008 Securitization Specialty Co., Ltd. (*2) WH2103 Securitization Specialty Co., Ltd. (*2) WN2103 Securitization Specialty Co., Ltd. (*2) WH2106 Securitization Specialty Co., Ltd. (*2) One Punch Korea the 1st Co., Ltd. (*2) (*5). One Punch blue the 1st Co., Ltd. (*2) (*5) One Punch red the 1st Co., Ltd. (*2) (*5) Held by Woori Asset Management Corp. Woori China Convertible Bond Hedging feeder Investment Trust H (debt-oriented hybrid) (*3) Woori Together TDF 2025 (*3)(*5) Woori Together TDF 2030 (*3)(*5) Woori Together TDF 2035 (*3) Woori Together TDF 2040 (*3) Woori Together TDF 2045 (*3) Woori Together TDF 2050 (*3) Woori Star50 Feeder Fund(H) (*3) (*5) Woori BIG2 Plus Securities Investment Trust (Balanced Bond) (*3) (*5) Woori Franklin Technology Master Fund (USD) (*3) (*11) Woori Franklin Technology Feeder Fund (H) (*3) Woori Together OCIO Target Return Master fund (*3) (*11) Woori Together OCIO Target Return Feeder fund (*3) Woori High Graded Bond Target Return Fund 1 (*3) 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 Securities investment and others Securities investment and others Securities investment and others Securities investment and others Securities investment and others Securities investment and others - 17 - Percentage of ownership (%) December 31, 2022 December 31, 2021 Financial statements date of use Location - 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 - - - 5.0 Korea - 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 5.0 Korea December 31 0.0 Korea 0.0 Korea 0.0 Korea - - - 88.0 93.6 Korea December 31 - - 57.1 58.3 69.3 66.3 - - 91.1 71.8 100.0 81.2 77.0 34.1 Korea 32.3 Korea - - 56.0 Korea December 31 55.7 Korea December 31 65.2 Korea December 31 63.6 Korea December 31 44.8 Korea 40.8 Korea - - - - - - - Korea December 31 Korea December 31 Korea December 31 Korea December 31 Korea December 31 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Subsidiaries Woori Multi Return Private Equity 2(*3) Main business Securities investment and others Percentage of ownership (%) December 31, 2022 December 31, 2021 Financial statements date of use Location 30.9 - Korea December 31 Held by Woori Financial F&I Co., Ltd. WI2203 Securitization Specialty Co., Ltd. (*2) WM2203 Asset Securitization Specialty Co., Ltd. (*2) WNI2206 Asset Securitization Specialty Co., Ltd. (*2) WI2209 Securitization Specialty Co., Ltd. (*2) WN2212 Asset Securitization Specialty Co., Ltd. (*2) WK2212 Asset Securitization Specialty Co., Ltd. (*2) Held by Woori Financial Capital Co., Ltd., Woori Private Equity Asset Management Co., Ltd. and Woori Investment Bank Co., Ltd. (*6) Japanese Hotel Real Estate Private Equity Fund 1 (*3) Held by Woori Global Asset Management Co., Ltd. Woori G Global Multi Asset Income Private Placement Investment Trust_Class Cs (*3) Woori G Happy Retirement Lifetime Asset securitization Asset securitization Asset securitization Asset securitization Asset securitization Asset securitization 5.0 5.0 5.0 5.0 5.0 5.0 - - - - - - Korea December 31 Korea December 31 Korea December 31 Korea December 31 Korea December 31 Korea December 31 Securities investment and others 100.0 100.0 Korea December 31 Securities investment and others 37.9 37.9 Korea December 31 Income TIF Mixed Asset Investment Trust[FoF] C(Y) (*3) Securities investment and others 99.3 - Korea December 31 Held by Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd., Woori Savings Bank and Woori Private Equity Asset Management Co., Ltd. (*6) Woori Innovative Growth Professional Investment Type Private Investment Trust No.1 (*3) Held by Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd. and Woori Private Equity Asset Management Co., Ltd. (*6) Woori Innovative Growth Professional Investment Type Private Investment Trust No.2 (*3) Woori Innovative Growth New Deal Private Investment Trust No.3 (*3) Held by Woori Bank, Woori Financial Capital Co., Ltd., and Woori Investment Bank Co., Ltd. (*6) Woori G GP Commitment Loan Securities investment and others 90.0 90.0 Korea December 31 Securities investment and others Securities investment and others 85.0 85.0 Korea December 31 94.3 94.3 Korea December 31 General Type Private Investment Trust No.1 (*3) Woori G Equity Bridge Loan General Type Private Investment Trust No.1 (*3) Securities investment and others Securities investment and others 100.0 100.0 Korea December 31 80.0 80.0 Korea December 31 - 18 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Subsidiaries Woori G GP Commitment Loan General Type Private Investment Trust No.2 (*3) Main business Securities investment and others Percentage of ownership (%) December 31, 2022 December 31, 2021 Financial statements date of use Location 100.0 - Korea December 31 Held by Woori Bank, Woori Financial Capital Co., Ltd., and Woori Global Asset Management Co., Ltd. (*6) Woori G New Deal(Infrastructure) Policy Fund No.1(*3) Securities investment and others 70.0 - Korea December 31 Held by Woori bank and Woori Investment Bank Co., Ltd. (*6) Heungkuk Woori Tech Company Private Placement Investment Trust No. 1 (*3) (*5) Woori Global Development Infrastructure Synergy Company Private Placement Investment Trust No.1 (*3) Woori G NorthAmerica Infra Securities investment and others Securities investment and others - 100.0 Korea - 100.0 100.0 Korea December 31 Private Placement Investment Trust No. 1 (*3) Securities investment and others 100.0 100.0 Korea December 31 Woori G Infrastructure New Deal Specialized Investment Private Equity Investment Trust No. 1 (*3) Woori G General Type Private Real Estate Investment Trust No.2 (*3) Woori G ESG Infrastructure Development General Type Private Investment Trust No.1 (*3) Held by Woori bank (*6) Woori G WooriBank Partners General Type Private Investment Trust No.1 (*3) Woori G General Type Private Real Estate Investment Trust No.1 (*3) Woori G Global Mid-market Secondary General Type Private Investment Trust No.1(EUR) (*3) Woori G Woori Bank Partners Professional Type Private Investment Trust No. 2 (*3) Woori G General Type Private Real Estate Investment Trust No.5 (*3) Woori G Senior Loan General Type Private Investment Trust No.2(*3) Woori G Government Bond MMF C/I (*3) Held by Woori Bank and Woori Financial Capital Co., Ltd.(*6) Woori G Renewable New Deal Fund No.1 (*3) Woori G Equity Investment General Type Private Investment Trust No.1 (*3) 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 Securities investment and others Securities investment and others Securities investment and others Securities investment and others - 19 - 100.0 100.0 Korea December 31 30.1 30.1 Korea December 31 100.0 100.0 Korea December 31 92.6 92.6 Korea December 31 80.0 80.0 Korea December 31 80.0 80.0 Korea December 31 90.9 90.9 Korea December 31 86.8 87.0 Korea December 31 50.0 46.0 - - Korea December 31 Korea December 31 60.0 - Korea December 31 100.0 - Korea December 31 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Subsidiaries Main business Woori Busan Logistics Infra Private Placement Special Asset Investment Trust (*3) Securities investment and others Percentage of ownership (%) December 31, 2022 December 31, 2021 Financial statements date of use Location 100.0 - Korea December 31 December 31 Held by Woori Financial Capital Co., Ltd.(*6) Woori G Japan Private Placement Real Estate Feeder Investment Trust No.1-1 (*3) Held by Woori Bank, Woori Card Co., Woori Financial Capital Co., Ltd. and Woori Investment Bank Co., Ltd. (*6) Woori FG Digital Investment Fund 1st (*3) Held by Woori G Japan Private Placement Real Estate Feeder Investment Trust No.1-1 and Woori G Japan Investment Trust No. 1-2(*6) Woori G Japan Private Placement Real Estate Master Investment Trust No.1 (*3) Held by Woori Financial Capital Co., Ltd. and Woori Investment Bank Co., Ltd. (*6) Woori G Japan Private Placement Real Estate Master Investment Trust No.2-1 (*3) Held by Woori G Japan Private Placement Real Estate Master Investment Trust No.1 and Woori G Japan Private Placement Real Estate Master Investment Trust No.2-1(*6) Woori G Japan Private Placement Real Estate Master Investment Trust No.2 (*3) Held by Woori G Japan Private Placement Real Estate Master Investment Trust No.1 GK OK Chatan (*3) Held by Woori G Japan Blind General Type Private Real Estate Feeder Investment Trust No.1 (*6) Woori G Private Placement Investment Trust No. 3 (*3) Held by Woori G Private Placement Investment Trust No. 3 GK Woorido Held by Woori G Infrastructure New Deal General Type Private Investment Trust (*6) Woori Seoul- Chuncheon Highway Private Placement Special Asset Investment Trust No.1 (*3) Securities investment and others 63.2 63.2 Korea December 31 Securities investment and others 100.0 - Korea December 31 Securities investment and others 100.0 100.0 Korea December 31 Securities investment and others 100.0 100.0 Korea December 31 Securities investment and others 100.0 100.0 Korea December 31 Other financial services 99.9 99.9 Japan October 31 (*8) Securities investment and others 76.5 - Korea December 31 Other financial services 100.0 - Japan December 31 Securities investment and others 48.0 - Korea December 31 - 20 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (*1) Additional investment occurred made for year ended December 31, 2021. (*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. (*5) Companies are excluded from the consolidation as of December 31, 2022. (*6) Determined that the Group controls the investees, considering 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, by two or more subsidiaries' investment or operation. (*7) During March 2021, the Parent company acquired a 100% equity of Woori Financial Savings Bank from the Parent company's subsidiary Woori Financial Capital Co., Ltd. (*8) As the financial statements for the end of the reporting period were not available, the most recent financial statements available from the date of settlement were used. (*9) The Parent company's subsidiary WB Finance Co., Ltd. has changed the name to WOORI BANK (CAMBODIA) PLC. (*10) The Russia – Ukraine conflict has been escalated in February 2022, Russia is imposed to the international sanctions. Due to the sanctions, the lack of liquidity in the Russian foreign exchange market as well as the significant decline in value of the Rubles and the decline in value of Russian companies’ securities are in progress. As a result, the Group may experience situations such as a decrease in value of financial assets or operating assets owned by the Group regarding the conflict, an increase in receivable payment terms, limitation to transfer funds, decrease in the profit. As of December 31, 2022, the Group expects such conflict and sanctions would have financial impacts on the business of AO Woori Bank, one of the subsidiaries, in the future. However, the Group cannot reasonably predict the financial impacts because it is very uncertain to estimate the impact on the Group’s financial position and business performance. (*11) As a master-feeder fund, it is the percentage of the feeder fund's ownership in the master fund. - 21 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) The Group has not consolidated the following entities as of December 31, 2022 and 2021 despite having more than 50% ownership interest: As of December 31, 2022 Subsidiaries Mirae Asset Maps Clean Water Private Equity Investment Trust 7th (*1) Kiwoom Yonsei Private Equity Investment Trust (*1) IGIS Europe Private Placement Real Estate Fund No. 163-2 (*2) IGIS Global Private Placement Real Estate Fund No. 148-1 (*1) IGIS Global Private Placement Real Estate Fund No. 148-2 (*1) Mirae Asset Seoul Ring Expressway Private Special Asset Fund No. 1 (*1) Hangkang Sewage Treatment Plant Fund (*1) Korea Investment Pocheon Hwado Expressway Professional Investment Fund (*1) Midas Global Private Placement Real Estate Investment Trust No. 7-2 (*1) Together-Korea Government Private Pool Private Securities Investment Trust No.3 (*3) INMARK France Private Placement Investment Trust No. 18-1 (*1) Kiwoom Vibrato Private Placement Investment Trust 1-W(EUR) (*2) KOTAM Global Infra Private Fund 1-4 (*2) UBSHana Class 1 Special Asset Investment Trust 3 Class C 2 (*1) Consus GyeongJu Green Specialized Private Special Asset Investment Trust 1 (*1) Kiwoom Harmony Private Placement Investment Trust No. 3 (*1) Consus Solar Energy Private Placement Investment Truns No.1(*1) IGIS ESG General Private Investment Trust No.1(*1) Kiwoom Aurora Geneal Type Private Placement Investment Trust No. 2(*1) NH-Amundi WSCP VIII Private Fund 2 (*1) AI Partners Global Infrastructure Specialized Privately Placed Feeder Fund Trust No. 2 (*2) Hangang new deal infra BTL fund 4 (HNBF4) (*1) Rifa Qualified Investors Private Real Estate Investment Trust No.40 (*2) Location Main Business Korea Korea Korea Korea Korea Korea Korea Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Korea Korea Securities Investment Securities Investment Korea Korea Korea Korea Korea Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Korea Korea Korea Korea Korea Korea Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Korea Korea Korea Securities Investment Securities Investment Securities Investment Percentage of ownership (%) 57.6 88.9 97.8 75.0 75.0 66.7 55.6 55.2 58.3 100.0 93.8 99.5 99.7 51.0 50.0 77.4 50.0 60.0 60.0 65.2 100.0 60.0 55.0 (*1) The Group does not have power over the discretionary fund because the fund manager has the sole authority to decide the relevant activities of the investee. The fund manager’s delegated power is exercised not only for the Group, but also for other investors as well. The Group does not have the power over the fund’s activities even though it holds more than 50% of ownership interest. (*2) The Group does not have power over the fund of funds because the Group cannot decide the relevant activities of the fund through the related contract. The Group does not have the power over the fund’s activities even though it holds more than 50% of ownership interest. (*3) The Group does not have power over the stock market stabilization fund as the fund’s relevant activities are determined by the management committee, over which the Group does not have substantial control. The Group does not have the power over the fund’s activities even though it holds more than 50% of ownership interest. As of December 31, 2021 Subsidiaries Location Main Business Korea Mirae Asset Maps Clean Water Private Equity Investment Trust 7th (*1) Korea Kiwoom Yonsei Private Equity Investment Trust (*1) Korea IGIS Europe Private Placement Real Estate Fund No. 163-2 (*2)(*4) Korea IGIS Global Private Placement Real Estate Fund No. 148-1 (*1)(*4) IGIS Global Private Placement Real Estate Fund No. 148-2 (*1)(*4) Korea Mirae Asset Seoul Ring Expressway Private Special Asset Fund No. 1 (*1)(*4) Korea Korea Hangkang Sewage Treatment Plant Fund (*1)(*4) Korea Investment Pocheon Hwado Expressway Professional Investment Fund Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Percentage of ownership (%) 59.7 88.9 97.9 75.0 75.0 66.7 55.6 (*1)(*4) Korea Midas Global Private Placement Real Estate Investment Trust No. 7-2 (*1)(*4) Korea Together-Korea Government Private Pool Private Securities Investment Trust Securities Investment Securities Investment No.3 (*3)(*4) INMARK France Private Placement Investment Trust No. 18-1 (*1)(*4) Kiwoom Vibrato Private Placement Investment Trust 1-W(EUR) (*2)(*4) KOTAM Global Infrastructure Private Equity Investment Trust No. 1-4 (*2) Hana UBS Class One Private Equity No. 3 C2 (*1) Consus Gyeongju Green Private Equity Investment Trust No. 1 (*1) (*4) Kiwoom Harmony Private Placement Investment Trust No. 3 (*1) (*4) Korea Korea Korea Korea Korea Korea Korea Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment Securities Investment 55.2 58.3 100.0 93.8 99.5 99.7 51.0 50.0 77.4 - 22 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Consus Solar Energy Private Placement Investment Truns No.1(*1) Subsidiaries As of December 31, 2021 Location Main Business Korea Securities Investment Percentage of ownership (%) 50.0 (*1) The Group does not have power over the discretionary fund because the fund manager has the sole authority to decide the relevant activities of the investee. The fund manager’s delegated power is exercised not only for the Group, but also for other investors as well. The Group does not have the power over the fund’s activities even though it holds more than 50% of ownership interest. (*2) The Group does not have power over the fund of funds because the Group cannot decide the relevant activities of the fund through the related contract. The Group does not have the power over the fund’s activities even though it holds more than 50% of ownership interest. (*3) The Group does not have power over the stock market stabilization fund as the fund’s relevant activities are determined by the management committee, over which the Group does not have substantial control. The Group does not have the power over the fund’s activities even though it holds more than 50% of ownership interest. (*4) In accordance with the amendment to the Capital Market Act, a specialized investment type private equity fund has been changed to a general private equity fund during the prior period. - 23 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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): Subsidiaries Woori Bank Woori Card Co., Ltd. Woori Financial Capital Co., Ltd. Woori Investment Bank Co., Ltd. Woori Asset Trust Co., Ltd. Woori Savings Bank Woori Asset Management Corp. Woori Financial F&I Co., Ltd. Woori Credit Information Co., Ltd. Woori Fund Service Co., Ltd. Woori Private Equity Asset Management Co., Ltd Woori Global Asset Management Co., Ltd. Woori FIS Co., Ltd. Woori Finance Research Institute Co., Ltd. Assets 443,340,979 16,118,967 12,581,473 5,657,191 322,098 1,786,495 185,389 336,141 42,832 25,094 94,434 34,988 112,117 6,456 As of and for the year ended December 31, 2022 Net income (loss) attributable to owners 2,892,165 204,385 183,328 91,794 60,319 10,607 1,259 867 1,784 3,917 1,902 211 1,069 46 Comprehensiv e income (loss) attributable to owners 2,651,873 199,397 189,765 92,379 60,316 10,998 1,314 867 2,083 3,917 1,872 211 11,559 245 Operating revenue 38,656,623 1,845,296 1,323,574 406,157 137,114 110,868 35,019 8,086 38,549 16,337 7,830 13,711 296,235 7,006 Liabilities 417,583,793 13,692,456 11,040,754 4,982,410 94,573 1,556,679 62,568 135,562 9,240 2,691 4,672 7,090 54,645 2,604 As of and for the year ended December 31, 2021 Net income (loss) attributable to owners 2,375,525 200,726 140,579 79,924 40,300 8,244 15,315 1,563 3,570 2,209 (441) 1,587 57 Comprehensive income (loss) attributable to owners 2,523,846 210,316 141,275 79,747 40,263 8,458 14,926 1,513 3,570 2,113 (441) 8,010 64 Subsidiaries Woori Bank Woori Card Co., Ltd. Woori Financial Capital Co., Ltd. Woori Investment Bank Co., Ltd. Woori Asset Trust Co., Ltd. Woori Asset Management Corp. Woori Savings Bank Woori Credit Information Co., Ltd. Woori Fund Service Co., Ltd. Woori Private Equity Asset Management Co., Ltd. Woori Global Asset Management Co., Ltd. Woori FIS Co., Ltd. Woori Finance Research Institute Co., Ltd. Assets 415,976,627 14,116,832 10,259,868 5,159,742 254,773 151,651 1,444,508 40,510 22,168 42,790 35,265 105,138 5,864 Liabilities 391,315,108 11,858,065 9,073,104 4,559,856 86,418 30,144 1,222,888 8,532 2,582 4,652 7,579 59,225 2,257 Operating revenue 24,311,964 1,528,680 997,655 303,253 94,228 33,343 85,813 37,507 15,618 4,230 11,785 270,393 6,812 - 24 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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, 2022 and 2021, the Group provides 231,309 million won and 2,480,131 million won of credit facilities, respectively, for the structured entities mentioned above. As of December 31, 2022 and 2021, the purchase commitment amounts to 2,545,164 million won and 2,263,387 million won, respectively. (6) The Group has entered into various agreements with structured entities such as asset securitization, structured finance, investment fund, and trust contract. The characteristics of interests 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 interests in unconsolidated structured entities that the Group hold are classified into asset securitization, structured finance, investment fund and real-estate trust, based on the nature and the purpose of each structured entity. Unconsolidated structured entities classified as ‘asset securitization’ 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 has been purchasing commitments of asset-backed securities or issuing asset-backed securities through credit grants, and recognizes 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 finance’ include real estate project financing investment vehicle, social overhead capital companies, and special purpose companies for ship (aircraft) financing. Each entity is incorporated as a separate company with a limited purpose in order to efficiently pursue business goals and the fund is raised by equity investment or loans from financial institutions and participating institutions. ‘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. - 25 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 dividend income as an investor in the same way as ‘structured finance’, and may be exposed to losses due to reduction in investment value. Investments in MMF(Money Market Funds) as of December 31, 2022 and 2021 are 875,470 million won and 853,140 million won, respectively, and there is no additional commitments for MMF. ‘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 consolidated 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 consolidated financial statements and the amount that is likely to be confirmed in the future when satisfies certain conditions by contracts such as purchase commitments, credit offerings. - 26 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 Purchase commitment Credit offerings and others 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 Investment assets Credit offerings and others Loss recognized on unconsolidated structured entities Asset securitization Structured Finance Investment Fund Real-estate trust December 31, 2022 (unit : Korean Won in millions)) 14,856,750 82,724,618 132,264,383 1,316,930 8,051,144 258,552 3,213,331 4,579,261 - - 824 729 95 8,153,111 8,051,144 - 101,967 5,537,836 6,642 45,735 5,485,336 - 123 6,606 4,975 1,631 6,086,831 5,537,836 - 548,995 4,964,712 4,397,416 - 31,124 535,427 745 2,091 2,091 - 9,322,308 4,964,712 4,352,518 5,078 - 17,388 113,976 40,073 10,480 - 29,593 - - 5,760 - 5,760 92,856 40,073 - 52,783 1,040 Asset securitization Structured Finance Investment Fund Real-estate trust December 31, 2021 (unit : Korean Won in millions)) 15,640,521 94,969,317 94,675,732 1,398,508 8,518,101 374,423 3,878,882 4,264,626 - 170 677 - 677 8,739,034 8,518,101 220,933 4,633,475 5,021 46,478 4,579,367 - 2,609 1,536 673 863 5,728,977 4,633,475 1,095,502 4,214,747 3,550,532 - 71,662 592,553 - - - - 4,221,072 4,214,747 6,325 54,662 10,665 - 43,997 - - 2,964 - 2,964 115,212 54,662 60,550 183 11,872 71,309 282 - 27 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (7) As of December 31, 2022 and 2021, 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 Co., Ltd. Woori Asset Trust Co., Ltd. Woori Asset Management Corp PT Bank Woori Saudara Indonesia 1906 Tbk Wealth Development Bank PT Woori Finance Indonesia Tbk. (*) Hybrid securities issued by Woori Bank December 31, 2022 December 31, 2021 2,344,816 283,221 78,434 34,073 92,118 20,759 13,964 2,555,166 251,879 60,726 33,768 87,741 20,835 - 2) Net income attributable to non-controlling interests Woori Bank (*) Woori Financial Capital Co., Ltd. Woori Investment Bank Co., Ltd. Woori Asset Trust Co., Ltd. Woori Asset Management Corp PT Bank Woori Saudara Indonesia 1906 Tbk Wealth Development Bank PT Woori Finance Indonesia Tbk. (*) Distribution of the hybrid securities issued by Woori Bank 3) Dividends to non-controlling interests For the years ended December 31 2021 2022 113,995 - 38,319 18,074 290 10,806 401 379 For the years ended December 31 2022 2021 Woori Bank (*) Woori Financial Capital Co., Ltd. Woori Investment Bank Co., Ltd. Woori Asset Trust Co., Ltd PT Bank Woori Saudara Indonesia 1906 Tbk 113,995 - 7,219 365 2,330 (*) Distribution of the hybrid securities issued by Woori Bank 144,923 17,949 33,274 11,366 2,341 8,619 928 - 144,923 4,121 3,610 365 1,262 - 28 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2. BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES (1) Basis of presentation The Group maintains its accounting records in Korean won and prepares statutory financial statements in the Korean language (Hangul) in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (K-IFRS). The accompanying consolidated financial statements have been condensed, restructured and translated into English from the Korean language financial statements. Certain information attached to the Korean language financial statements, but not required for a fair presentation of the Group's financial position, financial performance or cash flows, is not presented in the accompanying consolidated financial statements. The consolidated financial statements of the Group have been prepared in accordance with K-IFRS. These are the standards, subsequent amendments and related interpretations issued by the International Accounting Standards Board (IASB) that have been adopted by the Republic of Korea. The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. 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. Meanwhile, the consolidated financial statements of the Group were initially approved by the Board of Directors on February 8, 2023, and were revised and approved on March 3, 2023, and the final approval will be made in the annual general shareholders’ meeting on March 24, 2023. 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: i) K-IFRS 1007‘Statement of cash flow’ - Cash and cash equivalents The Group did not classify deposits with restrictions under relevant regulations, such as reserve deposits, as cash and cash equivalents. However, in accordance of the IFRS Interpretation Committee's agenda decision in April 2022 'Demand deposits restricted on use under contracts with third parties' and reply to K-IFRS inquiries 'whether the reserve deposit should be classified as cash and cash equivalents' the policy was changed to classifying the reserve deposits with restrictions under relevant regulations which meet the criteria of demand deposits as cash and cash equivalent and applied the modification retrospectively. The impact of this change in accounting policy is as follows: a) Impact on the statements of financial position Increase in cash and cash equivalents Decrease in loans and other financial assets at amortized cost December 31, 2022 December 31, 2021 January 1, 2021 22,965,162 13,047,255 7,352,253 (22,965,162) (13,047,255) (7,352,253) - 29 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 b) Impact on the statements of cash flow December 31, 2022 December 31, 2021 Increase in cash flows from operating activities Increase in exchange rate changes on cash and cash equivalents denominated in foreign currencies Net increase in cash and cash equivalents Increase in cash and cash equivalents, the beginning of the year Increase in cash and cash equivalents, the end of the year 9,981,310 5,600,710 (63,403) 9,981,310 13,047,255 94,292 5,600,710 7,352,253 22,965,162 13,047,255 ii) Amendments to K-IFRS 1103 ‘Business Combination’ – Reference to the Conceptual Framework The amendments update a reference of definition of assets and liabilities qualify for recognition in revised Conceptual Framework for Financial Reporting. However, the amendments add an exception for the recognition of liabilities and contingent liabilities within the scope of K-IFRS 1037 Provisions, Contingent Liabilities and Contingent Assets, and K-IFRS 2121 Levies. The amendments also confirm that contingent assets should not be recognized at the acquisition date. The amendment does not have a significant impact on the financial statements. ⅲ) Amendments to K-IFRS 1037 ‘Provisions, Contingent Liabilities and Contingent Assets’ – Onerous Contracts: Cost of Fulfilling a Contract’ The amendments clarify that the direct costs of fulfilling a contract include both the incremental costs of fulfilling the contract and an allocation of other costs directly related to fulfilling contracts when assessing whether the contract is onerous. The amendment does not have a significant impact on the financial statements. ⅳ) Amendments to K-IFRS 1016 ‘Property, Plant and Equipment’ – Proceeds before intended use The amendments prohibit an entity from deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while the entity is preparing the asset for its intended use. Instead, the entity will recognize the proceeds from selling such items, and the costs of producing those items, in profit or loss. The amendment does not have a significant impact on the financial statements. ⅴ) Annual Improvements to K-IFRS 2018-2020 The annual improvement includes some amendments to K-IFRS 1101 ‘First time Adoption of Korean International Financial Reporting Standards’, K-IFRS 1109 ‘Financial Instrument’s, K-IFRS 1116 ‘Lease’, K-IFRS 1041 ‘Agriculture’. These amendments do not have a significant impact on the consolidated financial statements. - K-IFRS 1101 ‘First time Adoption of Korean International Financial Reporting Standards’- Subsidiaries that are first-time adopters - K-IFRS 1109 ‘Financial Instrument’s - Fees related to the 10% test for derecognition of financial liabilities - K-IFRS 1116 ‘Lease’- Delete the contents of the lease improvement reimbursement amount. - K-IFRS 1041 ‘Agriculture’ - Measuring fair value - 30 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2) The details of K-IFRSs that have been issued and published as of December 31,2022 but have not yet reached the effective date, and which the Group have not been early adopted by the Group are as follows: i) Amendments to K-IFRS 1001 ‘Presentation of Financial Statements’ – Classification of Liabilities as Current or Non-current The amendments clarify that liabilities are classified as either current or non-current, depending on the substantive rights that exist at the end of the reporting period. Classification is unaffected by the likelihood that an entity will exercise right to defer settlement of the liability or the expectations of management. Also, the settlement of liability include the transfer of the entity's own equity instruments, however, it would be excluded if an option to settle them by the entity's own equity instruments if compound financial instruments is met the definition of equity instruments and recognized separately from the liability. The amendments should be applied for annual periods beginning on or after January 1, 2024, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the financial statements. ii) Amendments to K-IFRS 1001 ‘Presentation of Financial Statements and IFRS Practice Statement 2 Making Materiality Judgements’ - Disclosure of Accounting Policy 'IFRS Practice Statement 2' has been amended to define and disclose important accounting policies and to provide guidance on how to apply the concept of importance. These amendments apply for annual periods beginning on or after January 1,2023, and early application is permitted. The Group does not expect that these amendments have a significant impact on the financial statements. ⅲ) Amendments to K-IFRS 1001 ‘Presentation of Financial Statements’ - Disclosure of valuation gains or losses on financial liabilities with condition to adjust exercise price The amendments require disclosure of valuation gains or losses (limited to those recognized in the profit or loss) of the conversion options or warrants (or financial liabilities including them), if all or part of the financial instrument with exercise price that is adjusted depending on the issuer’s share price change is classified as financial liability as defined in paragraph 11 (2) of K-IFRS 1032. These amendments apply for annual periods beginning on or after January 1, 2023, and early application is permitted. The Group does not expect that these amendments have a significant impact on the financial statements. ⅳ) Amendments to K-IFRS 1008 ‘Accounting Policies, Changes in Accounting Estimates and Errors’ - Definition of Accounting Estimates The amendments have defined accounting estimates and clarified how to distinguish them from changes in accounting policies. These amendments apply for annual periods beginning on or after January 1, 2023, and early application is permitted. The Group does not expect that these amendments have a significant impact on the financial statements. ⅴ) Amendments to K-IFRS 1012 ‘Income Taxes’ - deferred tax related to assets and liabilities arising from a single transaction Additional phrase 'the temporary difference to be added and the temporary difference to be deducted do not occur in the same amount' has been added to initial recognition exception for a transaction in which an asset or liability is initially recognized. These amendments apply for annual periods beginning on or after January 1, 2023, and early application is permitted. The Group does not expect that these amendments have a significant impact on the financial statements. The above enacted or amended standards will not have a significant impact on the Group. - 31 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) Basis of consolidated financial statement presentation The consolidated financial statements consist of the financial statements of the parent company and the entities (including structured entities) controlled by the parent company (or 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) able to use its power to affect its returns. The Group reassesses whether 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 most 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 the Group's voting rights in an investee are enough 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; - - - Any additional facts and circumstances that indicate that the Group has, or does not have, the Rights arising from other contractual arrangements; 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 negative (-) balance. When 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. 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 amount 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. - 32 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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 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. The subsidiary's non-controlling interests are identified separately from the Group's equity. If the element of the non-controlling interest in the acquiree is the current interest at the acquisition date and the holder is entitled to a proportional share of the entity's net assets, the non-controlling interest can be measured in 1) fair value or 2) proportionate share of the current equity instrument of the amount recognized for the acquiree's identifiable net assets at the acquisition date. The selection of these metrics is made for each acquisition transaction. All other non-controlling interests are measured at fair value at the acquisition date. The carrying amount of the non-controlling interest after acquisition reflects the proportional interest of the non-controlling interest in changes in equity after acquisition in the initial recognition amount. Even if the non-controlling interest is a negative (-) balance, total comprehensive income is attributed to the non- controlling interest. 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. - 33 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. 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. - 34 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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. 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. - 35 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 the Group 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. (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 that correspond to its interest in a joint operation in accordance with the K-IFRSs applicable to the specific 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 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. - 36 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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. Revenues other than those from contracts with customers, such as interest revenue and loan origination fee (cost), are recognized 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 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 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. Most of these fees and commission received for brokerage are from the business activities relevant to Banking segment. 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. Most 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. Most 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. - 37 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. 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. Most 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 rying the applicable rate to the collected amount at the time when collection services are completed. Most of these fees and commission received for brokerage are from the business activities relevant to other segments. - 38 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. 3) Dividend income Dividend income is recognized when the right to receive dividends as a shareholder is confirmed. Dividend income is recognized as an appropriate item of profit or loss in the statement of comprehensive income according to the classification of financial instruments. - 39 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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 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. - 40 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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. 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 - 41 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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). 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. - 42 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. 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 carrying amount 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). - 43 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 In case when a financial asset is not fully derecognized, the Group allocates the carrying amount 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 carrying amount 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 carrying amount retained in the books, and to the portion of carrying amount 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. - 44 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. - 45 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. 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. b) Measurement of expected credit losses on financial asset at FVTOCI(Debt instruments) 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 accumulated other comprehensive income to net income. - 46 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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 carrying amount 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. 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 Useful life 26 to 57 years 4 to 5 years 4 to 7 years 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. - 47 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (13) Intangible assets and goodwill The Group recognizes the acquisition cost of an intangible asset as the manufacturing cost or purchase cost plus additional incidental expenses. Development costs are the sum of expenditures incurred after the asset recognition requirements, such as technical feasibility and future economic benefits, are met. After the initial recognition, the carrying value is presented as the accumulated amortization and accumulated impairment losses deducted from the cost. The Group’s intangible asset are amortized over the following economic lives using the straight-line method. However, for some intangible assets, the period of time that is expected to be available is not predictable, so the useful life of some intangible assets is assessed as indefinite and not depreciated. The estimated useful life and amortization method of intangible assets with a finite useful life 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 5 to 10 years 5 years 1 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. 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 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 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. - 48 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (15) Leases The Group determines whether the contract is a lease or includes a lease at the time of the contract agreement. In exchange for consideration in a contract, the contract is either a lease or includes a lease if the control over the use of the identified asset is transferred for a period of time. In determining whether a contract transfers control over the use of the asset to which it is identified, the Group uses the definition of lease in K-IFRS 1116. 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. The Group makes adjustments to reflect the terms of the lease and the characteristics of the lease asset in interest rates obtained from external financial information, and calculates the incremental borrowing rate. The Group calculates the lease term by including the relevant period when it is quite certain that the lessee will exercise the extension option or the termination option. The Group calculates the enforceable period in consideration of the economic disadvantages of terminating the contract if the lessee and the lessor have the right to terminate it without the consent of the other parties. The lease payments included in the measurement of the lease liability comprise the following: - - Variable lease payments that depend on an index(or a rate), initially measured using the index Fixed payments (including in-substance fixed payments) or a 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. - 49 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. Because the Group can replace the asset without significant cost or business discontinuation, the option to extend the lease is not included in the lease liability in most offices and vehicle transport leases. The Group reevaluates the lease term when the option is exercised (or not exercised) or the Group is liable to exercise (or not exercise) the option. Group will change its judgment only when significant events occur that affect the lessee's control and the determination of the lease term, or there is a significant change in the circumstances. Lease liabilities and right-of-use-asset increased by 1,650 million won, reflecting the exercise impact of the extension and termination options during the current term. 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 based on its relative stand-alone price. As a lessor, the Group classifies its leases as either a finance lease or an operating 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. - 50 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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. 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 are 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: - When there is an economic relationship between the hedged items and hedging instruments - 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 - 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). - 51 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 carrying amount 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. 3) Fair value hedge 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 carrying amount 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, carrying amount 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 carrying amount. 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 carrying amount 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 carrying amount 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. - 52 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. (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. - 53 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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. (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 carrying amount 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. - 54 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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(tax loss) 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. In addition, the Group appropriately estimates and reflects the amount of corporate tax liabilities based on the analysis of corporate tax laws and the evaluation of many factors, including past experiences. (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. - 55 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 3. SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS Significant accounting estimates and assumptions are continuously evaluated based on a number of factors, including historical experience and expectations of future events that are considered reasonably probable. Accounting estimates calculated based on these definitions may not match actual results. The accounting estimates and assumptions that include a significant risk of materially changing the carrying amounts of assets and liabilities currently recognized in the following accounting period are as follows. 1) COVID-19 effect review The diffusion of COVID-19 has had a significant impact on the global economy including Korea. Financial and economic shocks may have negative impacts on the Group's financial condition and results of operations in various forms both domestically and internationally, however, the Korean government is providing unprecedented financial and economic relief measures such as extension of maturity of loans. Despite the announcement of these various forms of government support policies, the negative impact of the COVID-19 on the global economy continues. The Group determined that the credit risk of loan affected by the loan deferment has significantly increased and evaluated that the possibility of default is high. The Group will continue to assess the adequacy of forward-looking information related to the duration of the impact of COVID-19 on economy and government policies. Woori Bank’s total loans (loan receivables, payment guarantees) that are subject to loan deferment and interest deferment, total loans that changed its stage from 12-month to lifetime expected credit losses (Stage 2), and the expected credit loss allowances recognized additionally are as follows. (Unit: Korean Won in millions): Total (loan loans receivables, payment guarantees) that are subject to loan deferment and interest deferment. Corporate Retail Total Total loans changed its stage from 12-month to lifetime (Stage 2) expected credit losses. Corporate Retail The expected credit loss allowances that are additionally recognized. Total Corporate Retail Total December 31, 2022 1,960,524 216,487 December 31, 2021 2,428,496 167,146 2,177,011 1,777,108 169,851 1,946,959 312,371 12,643 325,014 2,595,642 2,125,492 134,920 2,260,412 275,057 9,657 284,714 In addition, as of December 31, 2022 and 2021, the Group applied the overlay in consideration of the potential for insolvency due to market interest rate hikes and the increase in economic uncertainty due to the prolonged spread of COVID-19 when forecasting the future economy. As of December 31, 2022 and 2021, the monetary effect of the provision for expected credit loss due to the application of the forecast of future economic conditions overlay is as follows. (Unit: Korean Won in millions): Corporate Retail Total December 31, 2022 December 31, 2021 347,801 16,256 364,057 48,583 6,237 54,820 - 56 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Woori Card Co., Ltd. determined that the credit risk of obligors receiving financial support due to COVID-19 significantly increased, and transferred the loss allowance at the amount equivalent to lifetime expected credit loss. As of December 31, 2022, the balance of amortised cost of a financial asset of the obligors who need financial support amounts to 6,670 million won, and the additional provisioned loss allowance is 177 million won. Woori Financial Capital Co., Ltd. determined that the credit risk of obligors receiving financial support due to COVID-19 significantly increased, and evaluated that the possibility of default is high. As a result, as of December 31, 2022 and 2021, the amortized cost of a financial asset of the obligors subject to the deferment of redemption and interest deferment due to COVID-19 amounts to 52,611 million won and 80,291 million won, and the expected credit loss provisions recognized in relation to them are 10,606 million won and 15,575 million won. - 57 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2) 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/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 carrying amount 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. 3) 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 ‘2. Basis of Preparation and Significant Accounting Policies (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. 4) Impairment of financial instruments The accuracy of the provision for credit losses is determined by the estimation of the expected cash flows for each tenant for estimating the individually assessed loan-loss allowance, and the assumptions and variables in the model used for estimating the collectively assessed loan-loss allowance payment, guarantee and unused commitment. 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. Information on measuring expected credit loss is described in 4. Risk Management (1) 2) Measurement of expected credit loss. 5) 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. - 58 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 4. RISK MANAGEMENT The Group is exposed to various risks that may arise from its operating activities and the main types of risks are credit risk, market risk, liquidity risk and etc. The Risk Management Department analyze and assess the level of complex risks in order to manage the risks and the risk management standards such as policies, regulations, management systems and decision-making have been established and operated for sound management of the Group. The risk management organization is operated by Risk Management Committee, Chief Risk Officer(CRO), and Risk Management Department. The Board of Directors operates a Risk Management Committee comprised of outside directors for professional risk management. The Risk Management Committee plays a role as the top decision-making body in risk management by establishing basic policies for risk management that are in line with the Group’s management strategy and determining the risk level that the Group is willing to take. The Chief Risk Officer (CRO) assists the Risk Management Committee and operates a Group Risk Management Council comprised of risk management managers of subsidiaries to periodically check and improve the risk burden of external environments and the Group. The risk management department is independent and is in charge of risk management of the Group. It also supports reporting and decision- making of key risk-related issues. (1) Credit risk Credit risk represents the possibility of financial losses incurred due to the refusal of the transaction or 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 To measure credit risk, 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 rating, other than quantitative methods utilizing financial statements and others, and assessor’s judgement, the Group utilizes credit rating derived using statistical methods. In order to manage credit risk limit, the Group establishes the appropriate credit line per obligor, company or industry by monitoring 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 purchase of credit derivatives that have low correlation with the obligor’s credit status. 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. - 59 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2) Measurement of expected credit loss 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, depends on the degree of increase in credit risk since their initial recognition. Classification Stage 1 Definition Loss allowance No significant increase in credit risk after initial recognition (*) 12-month expected credit losses: Expected credit losses that result from those default events on the financial instrument that are possible within 12 months after the reporting date Stage 2 Significant increase in credit risk after initial recognition Lifetime expected credit losses: Stage 3 Credit- impaired Expected credit losses that result from all possible default events over the life of the financial instrument (*) If the financial instrument has low credit risk at the end of the reporting period, the Group may assume that the credit risk has not increased significantly since initial recognition. Loss allowance under credit impairment model is measured as the cumulative change in lifetime expected credit loss since initial recognition. At the end of each reporting period the Group assesses whether credit risk has significantly been increased since the date of initial recognition. The Group assesses whether the credit risk has increased significantly since initial recognition by using credit rating, asset quality level, early warning system, days past due and others. For financial assets whose contractual cash flows have been modified, the Group assesses whether there is a significant increase in credit risk on the same basis. The Group performs the below assessment to both corporate and retail exposures, and indicators of significant increase in credit risk are as follows: Corporate Exposures Retail Exposures Asset quality level ‘Precautionary’ or lower More than 30 days past due ‘Warning’ level in early warning system Debtor experiencing financial difficulties Asset quality level ‘Precautionary’ or lower More than 30 days past due Significant decrease in credit rating(*) Deferment of repayment of principal and interest (Capital impairment, Adverse opinion or Disclaimer of opinion by external auditors) Significant decrease in credit rating (*) Deferment of repayment of principal and interest Deferment of interest Deferment of interest (*) The Group has applied the below 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 - 60 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 The Group determined that there is 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 and interest 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 have been noted for the financial asset. The Group has estimated the allowance for credit losses using an estimation model that additionally reflects the future economic forward information based on the past experience loss rate data. Loss allowance is calculated by applying PD (default rate) and LGD (loss rate on default) estimated for each financial asset in consideration of factors such as obligor type, credit rating and portfolio. The estimates are regularly being reviewed in order to reduce discrepancies with actual losses. In measuring the expected credit losses, the Group is also using reasonable and supportable macroeconomic rate, Personal consumption expenditures increase/decrease rate, consumer price index change rate in order to forecast future economic conditions. indicators such as GDP growth The Group is conducting the following procedures to estimate and apply future economic forecast information. - Development of estimation models through regression analysis of corporate retail/year-by-year default rate and macroeconomic indicator data by year - - Calculation of estimated 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 estimation model developed Forecast of macroeconomic variables a) Probability weight As of December 31, 2022, the probability weights applied to the scenarios of the forecasts of macroeconomic variables is as follows (Unit: %): Probability weight Basic Scenario Upside Scenario Downside Scenario 52.57 12.52 34.91 b) Economic forecast of each major macroeconomic variables by scenario (prospect period: 2023) As of December 31, 2022, the forecasts of major macroeconomic variables by scenario is as follows (Unit: %) - 61 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 GDP growth rate Personal consumption expenditures increase/decrease rate Consumer price index change rate Basic Scenario 1.70 2.70 3.60 Upside Scenario Downside Scenario 1.89 3.11 3.39 1.36 1.97 3.97 - 62 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 The results of Woori Bank's sensitivity analysis on expected credit loss provisions due to changes in macroeconomic indicators as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Corporate Personal consumption expenditures Retail increase/decrease rate Consumer price index change rate Increase by 1% point Decrease by 1% point Increase by 1% point Decrease by 1% point (59,987) 68,036 (24,164) 28,042 December 31, 2022 Corporate GDP growth rate Personal consumption expenditures increase/decrease rate GDP growth rate Retail Consumer price index change rate Increase by 1% point Decrease by 1% point Increase by 1% point Decrease by 1% point Increase by 1% point Decrease by 1% point Increase by 1% point Decrease by 1% point December 31, 2021 (68,140) 74,495 (40,654) 43,028 (8,798) 9,163 (29,469) 34,352 (*) The sensitivity of the effect of the GDP growth rate on banks' ECLs is not significant. - The increase rate between the measured default rate and the predicted default rate is used as a future economic forecast adjustment coefficient and reflected to the applicable estimate for the current year. - 63 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 3) Maximum exposure 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 carrying amount 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 as of December 31, 2022 and 2021 is as follows (Unit: Korean Won in millions): December 31, 2022 December 31, 2021 2,877,685 21,571,097 143,507,852 187,804,095 355,760,729 34,995 4,270,532 899,228 8,206,181 1,505 13,412,441 2,207,893 24,412,685 131,027,256 191,237,783 348,885,617 65,072 2,743,239 667,467 4,803,131 1,518 8,280,427 Loans and other Korean treasury and government financial assets at amortized cost (*1) agencies Banks Corporates Consumers Sub-total Deposits Debt securities Loans Derivative assets Others Sub-total Financial assets at FVTPL (*2) Financial assets at FVTOCI Securities at amortized cost Derivative assets Off-balance accounts Debt securities 32,145,758 38,126,977 Debt securities Derivative assets (Designated for hedging) Payment guarantees (*3) Loan commitments Sub-total Total 28,268,516 17,086,274 37,786 11,921,586 118,172,070 130,093,656 559,718,886 106,764 12,987,809 114,414,462 127,402,271 539,888,330 (*1) Cash and cash equivalents are not included. (*2) Puttable financial instruments are not included. (*3) As of December 31, 2022 and 2021, the financial guarantee amount of 3,095,091 million won and 3,960,383 million won are included, respectively. - 64 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 a) Credit risk exposure by geographical areas The following tables analyze credit risk exposure by geographical areas (Unit: Korean Won in millions): Korea China USA December 31, 2022 UK Japan Others (*) Total Loans and other financial assets at amortized cost 331,572,328 5,188,826 4,721,440 215,174 719,301 13,343,660 355,760,729 Securities at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Derivative assets (Designated for hedging) Off-balance accounts Total 26,883,967 9,272,673 642,089 2,607 421,248 2,210,580 16,658 318,322 - 168,013 304,554 1,440,246 28,268,516 13,412,441 27,780,323 806,320 2,297,076 1,726 41,421 1,218,892 32,145,758 37,786 126,531,020 522,078,097 - 981,139 - 380,209 7,620,981 10,030,553 - 25,644 577,524 - 16,987 945,722 - 2,158,657 18,466,009 37,786 130,093,656 559,718,886 (*) Others consist of financial assets in Indonesia, Hong Kong, Germany, Australia, and other countries. Korea China USA December 31, 2021 UK Japan Others (*) Total Loans and other financial assets at amortized cost 325,947,526 5,620,622 3,742,331 212,821 635,939 12,726,378 348,885,617 Securities at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Derivative assets (Designated for hedging) Off-balance accounts Total 16,785,265 6,150,464 92,880 1,330 27,018 1,188,358 - 195,048 - 61,315 181,111 683,912 17,086,274 8,280,427 34,242,133 808,359 1,713,435 1,755 23,193 1,338,102 38,126,977 11,678 123,375,839 506,512,905 - 1,001,430 7,524,621 95,086 375,929 7,142,157 - 31,116 440,740 - 32,402 752,849 - 2,585,555 17,515,058 106,764 127,402,271 539,888,330 (*) Others consist of financial assets in Indonesia, Hong Kong, Germany, Australia, and other countries. - 65 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 b) Credit risk exposure by industries ① 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 as of December 31, 2022 and 2021 (Unit: Korean Won in millions): Service Manufacturing Finance and insurance Construction Individuals Others Total December 31, 2022 78,173,716 37,013,486 31,485,795 5,613,480 183,167,572 20,306,680 355,760,729 239,141 200,678 - 184,019 16,198,175 9,776,234 199,924 51,244 - 1,167 11,631,276 3,199,099 28,268,516 13,412,441 417,877 231,132 22,249,839 48,225 - 9,198,685 32,145,758 - 18,661,383 97,692,795 - 22,492,863 59,921,500 37,786 10,523,731 90,271,560 - 3,143,673 9,056,546 - 69,404,456 252,573,195 - 5,867,550 50,203,290 37,786 130,093,656 559,718,886 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 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 Service Manufacturing Finance and insurance Construction Individuals Others Total December 31, 2021 67,895,018 37,679,784 32,493,347 4,303,491 185,972,844 20,541,133 348,885,617 479,291 115,346 - 146,277 7,061,770 6,646,922 250,607 13,623 - 1,836 9,294,606 1,356,423 17,086,274 8,280,427 376,998 258,866 29,444,989 131,967 - 7,914,157 38,126,977 - 18,565,570 87,432,223 - 18,994,662 57,079,589 79,369 11,763,667 87,490,064 27,395 3,900,766 8,627,849 - 67,966,826 253,941,506 - 6,210,780 45,317,099 106,764 127,402,271 539,888,330 - 66 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 ② The detailed industries of financial assets and corporate loans that might get affected by the spread of COVID-19 as of December 31, 2022 and 2021 are as follow and the industries that can be affected may change by future economic conditions. (Unit: Korean Won in millions): < Woori Bank > December 31, 2022 Loans and other financial assets at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Service business Distribution business General retail business General wholesale business Sub-total Manufacturing Accommodation business Travel business Art/sports, leisure service Food business Transportation business Education Business Others Sub-total Textile Metal Non-metal Chemical Electronics Others Total Sub-total Service business Distribution business General retail business General wholesale business Sub-total Manufacturing Accommodation business Travel business Art/sports, leisure service Food business Transportation business Education Business Others Sub-total Textile Metal Non-metal Chemical Electronics Others Total Sub-total 1,157,537 1,801,361 2,958,898 1,434,456 48,655 1,780,739 1,520,098 357,940 425,779 1,560,457 10,087,022 2,361,092 1,579,004 796,671 3,649,189 1,409,475 3,280,434 13,075,865 23,162,887 824 1,659 2,483 2,228 - 1,012 426 181 169 773 7,272 767 191 1,529 158 58 1,287 3,990 11,262 December 31, 2022 Off-balance accounts Total 496,830 533,368 1,030,198 161,573 16,369 104,065 179,977 248,801 40,891 301,343 2,083,217 1,076,002 1,225,601 381,014 3,627,183 1,202,758 2,530,964 10,043,522 12,126,739 6,296 - 6,296 24,121 - - - - - - 30,417 8,898 - 7,629 - - 11,452 27,979 58,396 1,661,487 2,336,388 3,997,875 1,622,378 65,024 1,885,816 1,700,501 606,922 466,839 1,862,573 12,207,928 3,446,759 2,804,796 1,186,843 7,276,530 2,612,291 5,824,137 23,151,356 35,359,284 - 67 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 December 31, 2021 Loans and other financial assets at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Service business Distribution business General retail business General wholesale business Sub-total Manufacturing Accommodation business Travel business Art/sports, leisure service Food business Transportation business Others Sub-total Textile Metal Non-metal Chemical Electronics Others Total Sub-total Service business Distribution business General retail business General wholesale business Sub-total Manufacturing Accommodation business Travel business Art/sports, leisure service Food business Transportation business Others Sub-total Textile Metal Non-metal Chemical Electronics Others Total Sub-total 754,850 809,893 1,564,743 1,441,185 53,302 600,746 1,279,128 404,120 1,050,229 6,393,453 2,626,493 199,877 148,471 904,563 103,510 191,865 4,174,779 10,568,232 274 221 495 625 - 503 216 77 599 2,515 724 10 24 1,994 31 - 2,783 5,298 December 31, 2021 Off-balance accounts Total 299,064 237,678 536,742 181,563 12,455 63,660 179,799 167,883 191,837 1,333,939 1,012,989 9,704 48,171 689,895 33,389 87,587 1,881,735 3,215,674 - - - 23,840 - - - - - 23,840 10,718 - - - - - 10,718 34,558 1,054,188 1,047,792 2,101,980 1,647,213 65,757 664,909 1,459,143 572,080 1,242,665 7,753,747 3,650,924 209,591 196,666 1,596,452 136,930 279,452 6,070,015 13,823,762 - 68 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 < Woori Card Co., Ltd. > Accommodation business Travel business Aviation Cosmetics industry Distribution business Food industry Art/sports, leisure service Total Accommodation business Travel business Aviation Cosmetics industry Distribution business Food industry Art/sports, leisure service Total Loans and other financial assets at amortized cost 5,562 7,927 1,072 11,364 30,904 134,006 24,614 215,449 Loans and other financial assets at amortized cost 2,341 3,334 983 3,187 7,582 30,267 8,336 56,030 December 31, 2022 Financial assets at FVTPL Financial assets at FVTOCI Off-balance accounts Total - - - - - - - - - - - - - - - - 9,762 15,182 3,760 9,766 36,190 115,695 41,003 231,358 15,324 23,109 4,832 21,130 67,094 249,701 65,617 446,807 December 31, 2021 Financial assets at FVTPL Financial assets at FVTOCI Off-balance accounts Total - - - - - - - - - - - - - - - - 11,472 20,056 4,025 10,692 38,741 122,793 44,286 252,065 13,813 23,390 5,008 13,879 46,323 153,060 52,622 308,095 - 69 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 December 31, 2022 Loans and other financial assets at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Service business Distribution business General retail business General wholesale business Sub-total Manufacturing Accommodation business Travel business Art/sports, leisure service Food business Transportation business Education business Others Sub-total Textile Metal Non-metal Chemical Transportation Electronics Cosmetics Others Sub-total Total COVID-19 vulnerable business Other business Others Total Service business Distribution business General retail business General wholesale business Sub-total Manufacturing Accommodation business Travel business Art/sports, leisure service Food business Transportation business Education business Others Sub-total Textile Metal Non-metal Chemical Transportation Electronics Cosmetics Others Sub-total Total COVID-19 vulnerable business Other business Others Total - - - - - - - - - - - - - - - - - - - - - - - 363,655 266,515 630,170 40,237 5,880 66,388 228,254 367,311 52,652 2,203,264 3,594,156 15,204 25,274 4,067 14,071 2,867 28,202 1,192 255,864 346,741 3,940,897 5,706,295 9,647,192 363,655 266,515 630,170 40,237 5,880 66,388 228,254 367,311 52,652 1,997,073 3,387,965 15,204 25,274 4,067 14,071 2,867 28,202 1,192 235,972 326,849 3,714,814 5,337,618 9,052,432 - - - - - - - - - - - - - - - - - - - - - 21,652 21,652 December 31, 2022 Off-balance accounts Total - - - - - - - - - 206,191 206,191 - - - - - - - 19,892 19,892 226,083 347,025 573,108 - 70 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 December 31, 2021 Loans and other financial assets at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Service business Distribution business General retail business General wholesale business Sub-total Manufacturing Accommodation business Travel business Art/sports, leisure service Food business Transportation business Education business Others Sub-total Textile Metal Non-metal Chemical Transportation Electronics Cosmetics Others Sub-total Total COVID-19 vulnerable business Other business Others Total Service business Distribution business General retail business General wholesale business Sub-total Manufacturing Accommodation business Travel business Art/sports, leisure service Food business Transportation business Education business Others Sub-total Textile Metal Non-metal Chemical Transportation Electronics Cosmetics Others Sub-total Total COVID-19 vulnerable business Other business Others Total 77,841 292,832 370,673 7,338 57 8,544 125,075 598,972 22,118 102,787 1,235,564 727 2,824 698 172 438 3,993 685 108,540 118,077 1,353,641 6,489,394 7,843,035 - - - - - - - - - - - - - - - - - - - - - 28,222 28,222 December 31, 2021 Off-balance accounts Total - - - - - - - - - 140,549 140,549 - - - - - - - 13,432 13,432 153,981 812,597 966,578 - - - - - - - - - - - - - - - - - - - - - - - 77,841 292,832 370,673 7,338 57 8,544 125,075 598,972 22,118 243,336 1,376,113 727 2,824 698 172 438 3,993 685 121,972 131,509 1,507,622 7,330,213 8,837,835 - 71 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 < Woori Investment Bank Co., Ltd. > Accommodation business Distribution business Art/sports, leisure service Total Accommodation business Distribution business Art/sports, leisure service Total Loans and other financial assets at amortized cost 19,323 10,084 59,160 88,567 Loans and other financial assets at amortized cost 57,142 12,885 31,772 101,799 December 31, 2022 Financial assets at FVTPL Financial assets at FVTOCI Off-balance accounts - 19,774 - 19,774 - - - - December 31, 2021 Financial assets at FVTPL Financial assets at FVTOCI Off-balance accounts - - - - - - - - - - - - - - - - Total 19,323 29,858 59,160 108,341 Total 57,142 12,885 31,772 101,799 - 72 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 4) 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) as of December 31, 2022 and 2021 is as follows (Unit: Korean Won in millions): Stage 1 Stage 2 Above appropriate credit rating (*1) Less than a limited credit rating (*2) Above appropriate credit rating (*1) Less than a limited credit rating (*2) Credit impairment model Stage 3 Total Loss allowance Total, net December 31, 2022 308,498,799 23,391,187 13,061,081 11,533,632 1,447,967 313,717 358,246,383 (2,485,654) 355,760,729 2,879,057 39 393,181 21,182,445 120,407,588 16,680,863 9,291,691 74,939,770 - 2,125 2,556,885 1,754,620 - - 4,429,148 3,083,232 - 18,053 637,187 421,659 - - 2,879,096 21,595,804 313,717 145,025,388 89,490,972 - (1,411) (24,707) 2,877,685 21,571,097 (1,517,536) 143,507,852 88,474,933 (1,016,039) 34,965,279 6,751,297 754,668 1,257,741 173,818 - 43,902,803 (400,328) 43,502,475 10,502,539 164,029,709 637,875 47,597 6,317,104 10,502,071 88,175 7,104,484 41,710 792,727 313,717 11,631,613 - 188,746,095 11,530,444 (101,169) (942,000) 187,804,095 28,276,901 - - - - - 28,276,901 (8,385) 28,268,516 - 31,914,193 368,689,893 23,622,752 13,061,081 231,565 - 11,533,632 1,447,967 - - 32,145,758 313,717 418,669,042 (11,805) 32,145,758 (2,505,844) 416,175,003 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 (*3) Total 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 (*3) Total December 31, 2022 Collateral value Stage1 Stage2 Stage3 Credit impairment model Total 213,228,740 24,276 1,858,595 82,314,488 44,465,799 32,503,289 5,345,400 129,031,381 - - 213,228,740 19,354,919 - - 4,982,087 3,390,139 1,537,173 54,775 14,372,832 - - 19,354,919 607,614 - - 316,085 194,597 84,798 36,690 291,528 - - 607,614 313,717 - - 313,717 - - 313,717 - - - 313,717 233,504,990 24,276 1,858,595 87,926,377 48,050,535 34,125,260 5,750,582 143,695,742 - - 233,504,990 (*1) Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6. (*2) Credit grade of corporates are BBB- ~ C, and consumers are grades 7 ~ 10. (*3) Financial assets at FVTOCI has been disclosed as the amount before deducting loss allowance because loss allowance does not reduce the carrying amount. - 73 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 December 31, 2021 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 Stage 1 Stage 2 Above appropriate credit rating (*1) Less than a limited credit rating (*2) Above appropriate credit rating (*1) Less than a limited credit rating (*2) Stage 3 Total Loss allowance Total, net 303,317,270 22,734,430 13,270,491 10,190,307 1,332,644 350,845,142 (1,959,525) 348,885,617 2,211,798 23,865,911 108,917,062 68,767,641 9 492,447 15,952,017 9,010,115 9 46,373 2,698,907 1,886,740 - - 3,963,782 2,597,136 - 23,509 658,923 438,537 2,211,816 24,428,240 132,190,691 82,700,169 (3,923) (15,555) (1,163,435) (785,908) 2,207,893 24,412,685 131,027,256 81,914,261 33,306,787 6,459,338 790,750 1,353,313 156,440 42,066,628 (322,635) 41,743,993 6,842,634 168,322,499 17,091,509 482,564 6,289,957 - (*3) Total 37,917,922 358,326,701 209,055 22,943,485 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 (*3) Total 21,417 10,525,202 - - 13,270,491 13,333 6,226,525 - 63,946 650,212 - 7,423,894 192,014,395 17,091,509 (54,892) (776,612) (5,235) 7,369,002 191,237,783 17,086,274 - 10,190,307 - 1,332,644 38,126,977 406,063,628 (12,146) (1,976,906) 38,126,977 404,098,868 Stage1 208,188,057 20,679 1,287,055 74,403,502 40,288,663 30,852,567 3,262,272 132,476,821 - - 208,188,057 December 31, 2021 Collateral value Stage2 18,098,940 - - 4,796,510 3,120,790 1,675,720 - 13,302,430 - - 18,098,940 Stage3 643,183 - - 351,837 220,792 80,830 50,215 291,346 - - 643,183 Total 226,930,180 20,679 1,287,055 79,551,849 43,630,245 32,609,117 3,312,487 146,070,597 - - 226,930,180 (*1) Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6. (*2) Credit grade of corporates are BBB- ~ C, and consumers are grades 7 ~ 10. (*3) Financial assets at FVTOCI has been disclosed as the amount before deducting loss allowance because loss allowance does not reduce the carrying amount. b) Payment Guarantees and commitments The credit quality of the payment guarantees and loan commitments as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Stage 1 December 31, 2022 Stage 2 Above appropriate credit rating (*1) Less than a limited credit rating (*2) Above appropriate credit rating (*1) Less than a limited credit rating (*2) Stage3 Total Financial assets Off-balance accounts: Payment Guarantees Loan Commitments Total 10,790,470 113,169,542 123,960,012 846,997 2,610,173 3,457,170 25,826 1,638,982 1,664,808 245,061 753,139 998,200 13,232 11,921,586 234 118,172,070 13,466 130,093,656 (*1) Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6. (*2) Credit grade of corporate are BBB- ~ C, and consumers are grades 7 ~ 10. - 74 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Stage 1 December 31, 2021 Stage 2 Above appropriate credit rating (*1) Less than a limited credit rating (*2) Above appropriate credit rating (*1) Less than a limited credit rating (*2) Stage3 Total Financial assets Off-balance accounts: Payment Guarantees Loan Commitments Total 11,560,908 107,916,434 119,477,342 1,037,142 3,591,413 4,628,555 47,549 2,072,348 2,119,897 275,166 832,173 1,107,339 67,044 12,987,809 2,094 114,414,462 69,138 127,402,271 (*1) Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6. (*2) Credit grade of corporate are BBB- ~ C, and consumers are grades 7 ~ 10. 5) Collateral and other credit enhancements For the years ended December 31, 2022 and 2021, 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. 6) Among financial assets that measured loss allowance at lifetime expected credit losses, amortized costs before changes in contractual cash flows as of December 31, 2022 and 2021 are 149,511 million won and 145,594 million won, respectively, with net losses recognized along with the changes 8,474 million won and 11,734 million won, respectively. 7) 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. 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, 2022 and 2021 are 9,825,284 million won and 10,107,413 million won. In addition, the contractual non-recoverable amount of financial assets amortized for the year ended December 31, 2022, but still in the process of recovery is 1,382,281 million won. (2) Market risk 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, measuring its level, and evaluating the appropriateness of the level of accepted market risks for both trading and non-trading activities. a) Trading activities The Group uses the standard method and the internally developed model (the Bank) in measuring market risk for trading positions, and allocates market risk capital through the Risk Management Committee. Risk management departments of the Group and its subsidiaries manage limits in detail including those on risk and loss with their management result regularly reported to the Risk - 75 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Management Committee. 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 equity capital required for market 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 Bank for the year December 31, 2022 and 2021, and the VaR of the Bank as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): December 31, 2022 For the year ended December 31, 2022 Average Maximum Minimum December 31, 2021 11,800 7,055 8,847 6,590 11,987 12,448 4,298 1,806 4,177 2,972 For the year ended December 31, 2021 Average Maximum Minimum 2,405 1,609 14,017 6,676 4,681 3,637 Risk factor Interest rate Stock price Foreign currencies Diversification Total VaR(*) 17,608 (17,354) 19,109 14,002 (12,725) 16,714 22,251 (19,640) 27,046 5,421 (4,201) 7,324 5,904 (6,072) 6,981 6,745 (7,300) 7,763 13,144 (20,006) 13,831 4,747 (3,627) 5,134 (*) VaR (Value at Risk): Retention period of 1 day, Maximum expected losses under 99% level of confidence. b) Non-trading activities From the end of 2019 for the Bank and the beginning of 2021 for non-banking subsidiaries, the Bank and its subsidiaries manage and measure interest risk for non-trading activities through △NII(Change in Net Interest Income) and △EVE(Change in Economic Value of Equity) in accordance with IRRBB(Interest Rate Risk in the Banking Book). △NII represents a change in net interest income that may occur over a certain period (e.g. one year) due to 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 off- balance accounts. - 76 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 △EVE and △NII calculated on interest risk in banking book(IRRBB) basis for assets and liabilities by subsidiary as of December 31, 2022 and 2021 are as follows(Unit: Korean Won in millions): December 31, 2022 December 31, 2021 △EVE (*1) △NII (*2) △EVE (*1) △NII (*2) Woori Bank Woori Card Co., Ltd. Woori Financial Capital Co., Ltd. Woori Investment Bank Co., Ltd. Woori Asset Trust Co., Ltd. Woori Asset Management Corp. Woori Savings Bank Woori Private Equity Asset Management Co., Ltd. Woori Global Asset Management Co., Ltd. Woori Financial F&I Co., Ltd. 411,447 139,005 43,098 26,311 1,137 913 6,618 547 251 26,069 448,509 185,637 13,814 8,229 6,736 1,299 10,348 886 538 219 920,290 126,576 58,794 17,607 820 1,411 15,175 32 246 - 195,186 59,114 1,384 5,556 1,709 504 949 59 143 - (*1) △EVE: change in Economic Value of Equity (*2) △NII: change in Net Interest Income - 77 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 At the interest rate re-pricing date, cash flows (both principal and interest) of interest bearing assets and liabilities, which is the basis of non-trading position interest rate risk management are as follows: (Unit: Korean Won in millions): Within 3 months 4 to 6 months December 31, 2022 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 Financial assets at 224,863,400 56,669,335 15,469,920 15,108,779 59,454,649 5,963,926 377,530,009 FVTPL 1,888,996 119,725 1,364 4,670 71,620 13,129 2,099,504 Financial assets at FVTOCI Securities at amortized cost Total Liability: Deposits due to customers Borrowings Debentures Total Asset: Loans and other financial assets at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Securities at amortized cost Total Liability: Deposits due to customers Borrowings Debentures Total 2) Currency risk 6,093,805 4,224,460 3,014,625 3,550,982 15,409,527 584,203 32,877,602 2,749,432 1,427,736 20,126,354 235,595,633 62,820,324 20,254,845 20,092,167 95,062,150 1,768,936 1,806,804 167,237,029 49,107,093 33,506,265 40,006,233 55,855,781 1,183,331 14,829,024 6,654,602 4,962,350 19,621,659 9,068,737 191,134,790 58,171,916 39,681,742 46,151,914 82,132,042 1,542,340 4,633,137 4,159,096 4,905,727 2,100,203 29,979,465 8,661,461 442,486,580 69,861 345,782,262 472,325 28,840,718 3,298,581 46,490,191 3,840,767 421,113,171 Within 3 months 4 to 6 months December 31, 2021 10 to 12 months 7 to 9 months 1 to 5 years Over 5 years Total 205,915,030 58,661,091 14,461,769 12,840,318 62,337,321 5,204,605 359,420,134 1,725,063 52,361 49,843 17,817 223,107 13,501 2,081,692 5,489,649 4,741,319 3,915,011 4,139,102 19,962,071 634,111 38,881,263 1,297,865 949,475 11,990,559 214,427,607 64,301,905 19,240,028 17,946,712 94,513,058 813,405 847,134 145,744,829 47,792,440 33,334,918 28,615,157 62,635,705 1,540,533 11,422,868 5,119,291 3,174,902 25,036,943 8,325,421 165,493,118 54,997,145 38,327,258 33,330,592 92,791,939 1,788,597 3,203,743 4,168,941 3,035,764 2,116,986 18,015,424 7,969,203 418,398,513 59,155 318,182,204 428,660 24,468,890 3,342,284 46,119,057 3,830,099 388,770,151 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 as of December 31, 2022 and 2021 are as follows (Unit: USD in millions, JPY in millions, CNY in millions, EUR in millions, and Korean Won in millions): - 78 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 USD JPY December 31, 2022 CNY EUR Foreign currency Korean Won equivalent Foreign currency Korean Won equivalent Foreign currency Korean Won equivalent Foreign currency Korean Won equivalent Total Others Korean Won equivalent Korean Won equivalent Asset Cash and cash equivalents Loans and other financial assets at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Securities at 9,041 11,457,194 64,824 617,888 1,542 279,779 484 653,870 1,022,909 14,031,640 24,361 30,872,442 116,298 1,108,529 24,637 4,470,059 2,510 3,391,155 4,952,002 44,794,187 970 1,229,059 25,416 242,260 - - 358 484,172 176,057 2,131,548 3,307 4,191,383 - - 3,999 725,511 2 2,573 725,271 5,644,738 amortized cost Total 576 - 729,811 38,255 48,479,889 206,538 - 1,968,677 3,540 642,214 33,718 6,117,563 69 1,671,772 3,423 4,625,020 7,082,736 68,273,885 206,497 93,250 Liability Financial liabilities at FVTPL Deposits due to customers Borrowings Debentures Other financial liabilities Total 415 526,553 26,766 255,128 - - 322 434,590 274,895 1,491,166 24,569 31,135,881 227,260 44,365 6,894 8,737,229 - 4,174 5,289,246 2,166,196 422,876 - 28,125 5,102,886 1,023 185,652 - - 2,108 2,847,863 5,008,487 46,261,313 582,034 2,179,085 12,106,876 5,891,621 339,188 263,187 431 195 3,040 3,852,255 8,685 39,092 49,541,164 307,076 82,783 2,926,983 4,295 779,233 33,443 6,067,771 380 5,427,805 3,436 4,640,959 8,001,904 71,178,781 200,249 513,285 Off-balance accounts 6,698 8,488,374 34,512 328,964 1,141 207,012 787 1,063,680 868,470 10,956,500 USD JPY CNY EUR December 31, 2021 Foreign currency Korean Won equivalent Foreign currency Korean Won equivalent Foreign currency Korean Won equivalent Foreign currency Korean Won equivalent Total Others Korean Won equivalent Korean Won equivalent Asset Cash and cash equivalents Loans and other financial assets at amortized cost Financial assets at FVTPL Financial assets at FVTOCI Securities at 3,176 3,765,800 32,829 338,222 1,236 230,188 94 125,513 971,774 5,431,497 28,771 34,107,769 147,981 1,504,891 23,733 4,420,551 2,329 3,126,363 5,604,781 48,764,355 468 556,296 14,618 150,596 - - 327 438,662 71,369 1,216,923 3,195 3,787,466 - - 3,899 726,310 33 44,638 741,348 5,299,762 amortized cost Total 240 - 283,935 35,850 42,501,266 195,428 - 1,993,709 499 92,917 29,367 5,469,966 29 39,142 138,422 2,812 3,774,318 7,527,694 554,416 61,266,953 Liability Financial liabilities at FVTPL Deposits due to customers Borrowings Debentures Other financial liabilities Total 274 324,420 16,384 168,798 - - 239 321,354 203,523 1,018,095 19,803 23,476,384 219,514 31,601 5,766 6,835,191 - 3,566 4,228,055 2,261,520 325,745 - 26,342 4,906,441 - - - - 1,640 2,201,233 4,798,322 469,124 1,395,597 341,621 349 - - 37,643,900 9,025,657 4,569,676 2,739 3,247,454 10,673 32,148 38,111,504 278,172 109,958 2,866,021 2,658 495,125 29,000 5,401,566 335 449,897 211,392 2,563 3,441,608 6,950,455 4,513,826 56,771,154 Off-balance accounts 8,047 9,540,185 32,777 337,685 2,533 471,852 598 803,357 1,250,186 12,403,265 - 79 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 3) Interest Rate Benchmark Reform Risk Management The Group closely monitors the outputs and markets of various industrial working groups that manage the transition to new interest rate benchmark, which includes announcements by LIBOR regulators. A fundamental shift in interest rate indicators (hereinafter referred to as "interest rate benchmark reform") is taking place around the world, and some Interbank Offered Rates ("IBORs") are being replaced by new risk-free rates. In particular, for the case of LIBOR, except for USD LIBOR for overnight rate, 1, 3, 6, and 12 month rates, all of the calculations were suspended as of December 31, 2021, and the aforementioned 5 USD LIBORs will also be suspended as of June 30, 2023. The Group established a LIBOR-related response plan consisting of the business flow of risk management, accounting, tax, law, computerization and customer management. The purpose of the plan is to identify the impact and risks associated with interest rate benchmark reform within the business, and to prepare and implement an action plan to ensure a smooth transition to alternative interest rates. The Group aims to close the response plan in line with the supervisory authority's response guidelines. The details of Woori Bank’s financial instruments that have not completed the conversion to the LIBOR-related interest rates benchmark at the end of the year are as follows: Non-derivative financial instrument is presented at the carrying amount, while the derivative financial instrument is presented at the nominal amount. Non-derivative financial assets Financial assets at FVTOCI Financial assets at amortized cost Total Non-derivative December 31.2022 USD(*1) Total Amount(*2) Interest Rate Provision 514,935 4,214,876 4,729,811 355,247 3,237,567 3,592,814 financial liabilities Financial liabilities at amortized cost 89,326 89,326 Derivatives Interest rate(trading) Currency(trading) Interest rate(hedging) Total 26,210,037 26,208,438 33,886,969 2,344,505 62,441,511 33,598,769 2,344,505 62,151,712 (*1) Financial instruments related to USD Libor (overnight rate, 1, 3, 6, 12 month rates) that are expired before June 30, 2023 are excluded. (*2) For contracts that do not have an interest rate alternative clause, The Group is in the process of negotiating to add an interest rate alternative clause. The KRW CD rates are planned to be replaced by the Korea Overnight Financing Repo Rate (KOFR) in the long run, but when the CD rates will be ceased or the policy response directions to activate alternative rates are not clear. < Woori Card Co., Ltd. > The hedging relationship in which Woori Card applies cash flow risk hedge is affected by interest rate indicators related to interest rate benchmark reform. The interest rate benchmarks for which the hedging relationship is exposed are USD 1M LIBOR and USD 3M LIBOR. The nominal amounts of hedging instruments associated with 1M LIBOR and 3M LIBOR among the hedging relationships of Woori Card are USD 270,000,000 and USD 100,000,000, respectively. Woori Card is closely monitoring market and industry discussions regarding applicable alternative benchmark interest rates for exposed interest rate benchmarks, and believes that this uncertainty will no longer appear when exposed interest benchmarks are replaced by applicable interest rates. - 80 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 The hedging relationship in which Woori Financial Capital applies cash flow risk hedge accounting is affected by interest rate benchmarks related to interest rate benchmark reform. The interest rate benchmark with the corresponding hedging relationship exposed is the KRW 3M CD. The nominal amount of the hedging instrument associated with the KRW 3M CD of Woori Financial Capital 's hedging relationship is KRW 40 billion. Woori Financial Capital is closely watching market and industry discussions regarding applicable alternative benchmark interest rates for exposed interest rate benchmarks, and believes that this uncertainty will no longer appear when exposed interest benchmarks are replaced by applicable interest rates. - 81 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) Liquidity risk 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 maturity of assets and liabilities or unexpected cash outflows. The the consolidated 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. The information on early repayment related to asset securitization is described in NOTE 40. CONTINGENT LIABILITIES AND COMMITMENTS (4) 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 as of December 31, 2022 and 2021 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 Lease liabilities Other financial liabilities Total Within 3 months 4 to 6 months 7 to 9 months 10 to 12 months 1 to 5 years Over 5 years Total December 31, 2022 35,161 - - - - 12,113 47,274 228,890,427 8,969,648 6,348,064 68,279 36,851,103 5,734,715 6,841,379 36,724 24,091,740 3,210,812 5,211,032 35,136 42,652,679 14,999,516 1,522,830 349,008,295 484,909 29,013,535 3,298,581 46,535,657 354,171 3,156,211 7,457,240 5,214,942 19,621,659 151,379 33,007 29,646 14,409,376 258,720,955 113,049 49,576,970 19,370 32,568,090 20,315 765,870 3,037,563 18,365,543 51,073,793 42,995,664 8,389,003 443,324,475 Within 3 months 4 to 6 months 7 to 9 months 10 to 12 months 1 to 5 years Over 5 years Total December 31, 2021 100,976 10,397 91,785 107,230 - - 310,388 224,881,863 32,559,199 20,290,566 31,768,748 2,494,732 5,371,869 4,366,223 4,201,926 53,245 2,415,548 5,316,672 30,148 9,477,536 3,068,600 41,731 25,494 9,213,279 5,800,815 24,982,746 156,228 1,615,198 320,328,853 440,506 24,995,360 3,342,284 46,284,097 345,121 38,275 17,614,313 610,514 255,185,019 41,419,378 28,156,909 39,779,967 40,763,582 228,388 12,190 11,894 1,999,198 20,476,497 7,435,461 412,740,316 - 82 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 b) Cash flows of principals and interests by expected maturities of non-derivative financial liabilities as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Within 3 months 4 to 6 months December 31, 2022 10 to 12 months 7 to 9 months 1 to 5 years Over 5 years Total Financial liabilities at 35,161 FVTPL 12,113 47,274 - 56,013 347,733,760 Deposits due to customers 242,132,680 41,113,768 24,269,363 29,670,943 10,490,993 8,969,648 5,734,715 3,210,812 3,156,211 7,457,240 Borrowings 484,909 29,013,535 6,348,064 6,841,379 5,211,032 5,214,942 19,621,659 3,298,581 46,535,657 Debentures 157,361 Lease liabilities 366,343 38,584 68,344 14,409,376 Other financial liabilities 765,870 3,037,563 18,365,543 271,963,273 53,839,640 32,745,954 38,092,359 38,493,123 6,927,763 442,062,112 Total 36,729 113,049 29,948 20,315 35,377 19,370 - - - Within 3 months 4 to 6 months December 31, 2021 10 to 12 months 7 to 9 months 1 to 5 years Over 5 years Total Financial liabilities at 10,397 FVTPL 100,976 310,388 - 89,643 319,930,769 Deposits due to customers 230,823,884 33,705,990 20,107,790 27,331,774 7,871,688 9,477,536 4,366,223 2,415,548 2,494,732 5,800,815 Borrowings 440,506 24,995,360 3,068,600 4,201,926 5,316,672 5,371,869 24,982,746 3,342,284 46,284,097 Debentures 162,092 Lease liabilities 354,751 41,814 Other financial liabilities 610,514 1,999,198 20,476,497 261,127,025 42,566,184 27,974,201 35,343,152 39,427,855 5,913,445 412,351,862 Total 41,716 17,614,313 53,260 228,388 30,216 12,190 25,653 11,894 107,230 91,785 - 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, 2022 and 2021 is as follows (Unit: Korean Won in millions): Within 3 months 4 to 6 months Remaining maturity 10 to 12 months 7 to 9 months 1 to 5 years 50,682 1,255 18,540 118,027 - (2,744) 21,552 - - (717) 1,392 - Over 5 years - (3,615) Total 54,613 206,149 - 8,905,125 (7,976) (4,053) - 20,946 - 4,566,443 December 31, 2022 December 31, 2021 Cash flow risk hedge Fair value risk hedge Trading purpose Cash flow risk hedge Fair value risk hedge Trading purpose 856 25,048 8,905,125 246 (1,656) 4,566,443 905 16,175 - (206) 598 - 915 31,974 - (502) (940) - - 83 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 4) Maturity analysis of off-balance accounts (Payment guarantees, commitments, and etcs) A payment guarantee represents an irrevocable undertaking that the Group should meet a customer’s obligations to third parties if the customer fails to do so. The loan commitment represents the limit if the Group has promised a credit to the customer. Loan commitments 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 payment guarantees, such as financial guarantees for debentures issued or loans, unused loan commitments, and other credits, 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 as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Payment guarantees Loan commitments Other commitments December 31, 2022 December 31, 2021 11,921,586 118,172,070 4,602,429 12,987,809 114,414,462 3,427,331 - 84 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) Operational risk 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 established and operated an operating risk management system to strengthen external competitiveness, reduce risk capital volume, enhance operational risk management capacity and prevent accidents through compliance with Basel II, and has obtained approval from the Financial Supervisory Service for “Advanced Measurement Approaches”(AMA) based on self-compliance verification and independent third-party inspection results. 2) Operational risk measurement The Group is applying the basic indicator method for the purpose of calculating the regulatory capital of operation risk, and the Bank is applying the Advanced Measurement Approaches. The Bank applies AMA using internal and external loss data, business environment and internal control factors, and scenario analysis. (5) Capital management The Group complies with the standard of capital adequacy provided by financial regulatory authorities. The capital adequacy standard is based on Basel Ⅲ published by Basel Committee on Banking Supervision in Bank for International Settlement 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 minimum requirements: Tier 1 common capital ratio of 8.0%, a Tier 1 capital ratio of 9.5%, and a total capital ratio of 11.5% as of December 31, 2022 and 2021 Details of the Group’s capital adequacy ratio as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Details(*) December 31, 2022 December 31, 2021 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 23,757,296 4,208,994 3,437,735 31,404,025 182,028,062 6,759,527 16,519,885 205,307,474 11.57% 13.62% 15.30% 21,994,047 3,590,212 3,395,989 28,980,248 171,199,840 6,388,428 14,914,801 192,503,069 11.43% 13.29% 15.05% (*) The capital ratio at the end of the current period is provisional - 85 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 prior term, the Group 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, capital, 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 Capital Investment Banking Others Loans/deposits and relevant services for customers of Woori Bank and its subsidiaries Credit card, cash services, card loans and accompanying business of Woori Card Co., Ltd. Installments, loans including lease financing, and accompanying business of Woori Financial Capital 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 Asset Trust Co., Ltd., Woori Asset Management Corp., Ltd., Woori Financial F&I Co., Ltd., Woori Savings Bank., Woori Credit Information Co., Ltd., Woori Fund Services Inc., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd., Woori FIS Co., Ltd. and Woori Finance Research Institute, - 86 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) The composition of each organization's sectors for the years ended December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Banking 6,603,834 Credit card 675,250 Capital 376,133 For the year ended December 31, 2022 Investment banking 117,867 Others (*1) 73,800 7,846,884 Sub-total Other adjustments (*2) 34,307 Internal adjustments (*3) 817,543 Consolidated Adjustments (*4) (2,155) Total 8,696,579 1,520,576 110,888 83,428 82,885 1,750,203 3,547,980 17,498 (761,029) (1,655,342) 1,149,107 (426,552) (238,607) (107,906) (16,491) (38,319) (827,875) - (57,992) 595 (885,272) (3,914,672) (262,525) (99,872) (61,631) (493,502) (4,832,202) (409) - 302,721 (4,529,890) 3,783,186 285,006 251,783 122,630 1,292,182 5,734,787 51,396 (1,478) (1,354,181) 4,430,524 73,958 - 1,430 334 2,173 77,895 (182) - (7,717) 69,996 5,563 (6,373) (1,835) (1,399) (2,386) (6,430) 2,371 1,478 (12,565) (15,146) 79,521 (6,373) (405) (1,065) (213) 71,465 2,189 1,478 (20,282) 54,850 3,862,707 (959,298) 2,903,409 278,633 (73,869) 204,764 251,378 (68,050) 183,328 121,565 1,291,969 5,806,252 (26,739) (1,157,727) (29,771) 91,794 1,265,230 4,648,525 53,585 - 53,585 - - - (1,374,463) (3,665) (1,378,128) 4,485,374 (1,161,392) 3,323,982 443,340,979 16,118,967 12,581,473 5,657,191 28,059,619 505,758,229 2,019,322 917,581 - 40,987 6,548 22,427,853 23,392,969 29,658 442,423,398 16,118,967 12,540,486 5,650,643 5,631,766 482,365,260 1,989,664 417,583,793 13,692,456 11,040,754 4,982,410 4,146,997 451,446,410 50,762 - - - - (27,303,155) (22,116,991) (5,186,164) (2,650,118) 480,474,39 6 1,305,636 479,168,76 0 448,847,05 4 Net interest income Non-interest income(expense) Impairment losses due to credit loss General and administrative expense Net operating income(expense) Share of gain of associates Other non-operating expense Non-operating income(expense) Net income(expense) before tax Tax expense Net income(loss) Total assets Investment in associate Other assets Total liabilities (*1) Other segments include gains and losses from Woori Financial Group Inc., Woori Asset Trust Co., Ltd., Woori Savings Bank, Woori Asset Management Corp., Woori Financial F&I Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Service Co., Ltd., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd., Woori FIS Co., Ltd. and Woori Finance Research Institute. (*2) Other segments includes the funds subject to Group's consolidated not included in the reporting segment. (*3) Internal reconciliation includes the adjustment of deposit insurance premiums of KRW 423,834 million and fund contribution fees of KRW 402,057 million from net interest income expenses to non-interest income expenses in order to present the profit and loss adjustment between reporting divisions in accordance with management accounting standards as profit and loss in accordance with accounting standards (*4) Consolidation adjustments include the elimination of KRW 300,297 million of internal transactions between Woori FIS Co., Ltd., the group's IT service agency, and affiliates, and the removal of KRW 1,272,393 million of dividends received by the holding company from its subsidiaries. - 87 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Banking 5,158,078 Credit card 606,506 Capital 315,600 For the year ended December 31, 2021 Investment banking 108,321 Others (*1) 29,515 6,218,020 Sub-total Other adjustments (*2) Internal adjustments (*3) consolidated adjustments (*4) 9,938 758,559 (796) Total 6,985,721 1,661,903 63,839 95,297 49,419 1,111,422 2,981,880 16,431 (670,230) (969,804) 1,358,277 (140,574) (164,097) (122,089) (1,885) (19,601) (448,246) - (89,683) 1,091 (536,838) (3,606,715) (225,175) (99,048) (51,490) (440,601) (4,423,029) (256) - 275,874 (4,147,411) 3,072,692 281,073 189,760 104,365 680,735 4,328,625 26,113 (1,354) (693,635) 3,659,749 60,049 - 1,000 750 4,390 66,189 51 - (4,044) 62,196 42,542 (7,936) (16,943) (660) (1,071) 15,932 2,956 1,354 7,054 27,296 102,591 (7,936) (15,943) 90 3,319 82,121 3,007 1,354 3,010 89,492 3,175,283 (790,177) 2,385,106 273,137 (72,411) 200,726 173,817 (33,238) 140,579 104,455 (24,531) 79,924 684,054 4,410,746 (16,799) (937,156) 667,255 3,473,590 29,120 - 29,120 - - - (690,625) (4,714) (695,339) 3,749,241 (941,870) 2,807,371 415,976,627 14,116,832 10,259,868 5,159,742 25,627,649 471,140,718 1,101,162 - (25,058,009) 447,183,871 858,706 - 12,403 8,846 22,165,895 23,045,850 35,134 415,117,921 14,116,832 10,247,465 5,150,896 3,461,754 448,094,868 1,066,028 54,595 391,315,108 11,858,065 9,073,104 4,559,856 3,284,269 420,090,402 - - - (21,745,817) 1,335,167 (3,312,192) 445,848,704 (1,811,321) 418,333,676 Net interest income Non-interest income(expense) Impairment losses due to credit loss General and administrative expense Net operating income(expense) Share of gain of associates Other non-operating expense Non-operating income(expense) Net income(expense) before tax Tax expense Net income(loss) Total assets Investment in associate Other assets Total liabilities (*1) Other segments include gains and losses from Woori Financial Group Inc., Woori Asset Trust Co., Ltd., Woori Savings Bank, Woori Asset Management Corp., Woori Financial F&I Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Service Co., Ltd., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd., Woori FIS Co., Ltd. and Woori Finance Research Institute. (*2) Other segments includes the funds subject to Group's consolidated not included in the reporting segment. (*3) Internal reconciliation includes the adjustment of deposit insurance premiums of KRW 406,276 million and fund contribution fees of KRW 367,961 million from net interest income expenses to non-interest income expenses in order to present the profit and loss adjustment between reporting divisions in accordance with management accounting standards as profit and loss in accordance with accounting standards (*4) Consolidation adjustments include the elimination of KRW 274,768 million of internal transactions between Woori FIS Co., Ltd., the group's IT service agency, and affiliates, and the removal of KRW 692,605 million of dividends received by the holding company from its subsidiaries. - 88 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) Operating profit or loss from external customers for the years ended December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Details Domestic Foreign Total For the years ended December 31 2022 2021 3,835,809 594,715 4,430,524 3,288,341 371,408 3,659,749 (4) Major non-current assets as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Details (*) Domestic Foreign Total December 31, 2022 (*) December 31, 2021 (*) 5,152,033 533,354 5,685,387 5,201,838 482,930 5,684,768 (*) Major non-current assets included joint ventures and related business investments, investment properties, premises equipment, and intangible assets. (5) Information about major customers The Group does not have any single customer that generates 10% or more of the Group’s total revenue for the years ended December 31, 2022 and 2021. - 89 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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, 2022 1,771,316 628,590 31,729,228 90,014 34,219,148 December 31, 2021 1,742,449 503,205 18,208,784 158,635 20,613,073 (2) Details of restricted cash and cash equivalents are as follows (Unit: Korean Won in millions) Counterparty December 31, 2022 Reason of restriction Due from banks in local currency: Due from BOK BOK Due from banks in foreign currencies: Due from banks on BOK and others demand Total 16,527,445 Reserve deposits under the BOK Act Reserve deposits under the 6,437,717 22,965,162 BOK Act and others Counterparty December 31, 2021 Reason of restriction Due from banks in local currency: Due from BOK BOK Due from banks in foreign currencies: Due from banks on BOK and others demand Total 9,619,055 Reserve deposits under the BOK Act Reserve deposits under the 3,428,200 13,047,255 BOK Act and others (3) Significant transactions of investing activities and financing activities not involving cash inflows and outflows are as follows (Unit: Korean Won in millions): Changes in other comprehensive income related to valuation of financial assets at FVTOCI Changes in other comprehensive income related to valuation of assets of associate Changes in other comprehensive income related to valuation profit or loss on cash flow hedge Changes in financial assets measure at FVTOCI due to debt-for-equity swap Changes in the investment assets of associates due to the transfer of assets held-for-sale Changes in the property, plant and equipment due to the transfer of assets held-for-sale Transfer of investment properties and premises and equipment Changes in account payables related to premises and equipment Changes in account payables related to intangible assets Changes in right-of-use assets and lease liabilities - 90 - For the years ended December 31 2022 2021 (493,871) (150,327) 612 (9,835) 14,594 - 1,526 7,107 79 (52) (13,109) (12,852) 7,154 281 (11,530) 194,236 6,095 - (11,640) 150,644 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Comprehensive stock exchange Changes in other comprehensive income related to foreign operation translation For the years ended December 31 2022 2021 - 28,746 64,301 246,808 (4) 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, 2022 Not involving cash inflows and outflows Variation of gain(loss) on valuation of hedged items Foreign Exchange Cash flow 2,881,675 (484,874) (187,531) 513 760,918 297,861 4,645 - 2,209,783 1,063,424 - (257,910) - - (257,910) Beginning balance 24,755,459 44,653,864 343,213 26,907 69,779,443 Borrowings Debentures Lease liabilities Other liabilities Total Others (*) Ending balance 31,551 28,429,603 (10,455) 44,198,486 319,161 158,834 27,384 (36) 179,894 72,974,634 (*) The change in lease liabilities due to the new contract includes 235,215 million won. For the year ended December 31, 2021 Not involving cash inflows and outflows Beginning balance 20,745,466 37,479,358 407,431 26,354 58,658,609 Foreign Exchange Variation of gains on valuation of hedged items Cash flow 3,199,712 6,893,661 (177,593) 14,173 804,649 392,077 10,950 - 9,929,953 1,207,676 - (104,306) - - (104,306) Borrowings Debentures Lease liabilities Other liabilities Total Others (*) Ending balance 5,632 24,755,459 (6,926) 44,653,864 343,213 102,425 26,907 (13,620) 87,511 69,779,443 (*) The change in lease liabilities due to the new contract includes 189,660 million won. - 91 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 7. FINANCIAL ASSETS AT FVTPL (1) Details of financial assets at FVTPL as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Financial assets at fair value through profit or loss measured at fair value 19,860,573 13,497,234 December 31, 2022 December 31, 2021 (2) Financial assets at fair value through profit or loss measured at fair value as of December 31, 2022 and 2021 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 Others Sub-total Loans Derivatives assets Other financial assets Total December 31, 2022 December 31, 2021 34,995 65,072 2,754,442 620,311 721,573 174,206 383,883 1,976,474 3,902,762 143,334 10,676,985 899,228 8,206,181 43,184 19,860,573 995,713 925,474 751,636 70,416 329,864 1,287,723 3,504,547 94,673 7,960,046 667,467 4,803,131 1,518 13,497,234 The Group does not have financial assets at fair value through profit or loss designated as upon initial recognition as of December 31, 2022 and 2021. - 92 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 8. FINANCIAL ASSETS AT FVTOCI (1) Details of financial assets at FVTOCI as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Debt securities: Korean treasury and government agencies Financial institutions Corporates Bond denominated in foreign currencies Securities loaned Equity securities Sub-total Total December 31, 2022 December 31, 2021 5,487,983 16,870,619 4,044,446 5,644,684 98,026 32,145,758 939,322 33,085,080 4,728,085 22,909,615 5,091,035 5,299,707 98,535 38,126,977 992,812 39,119,789 (2) Details of equity securities designated as financial assets at FVTOCI as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Purpose of acquisition Investment for strategic business partnership purpose Debt-equity swap Others Total December 31, 2022 December 31, 2021 Remarks 776,199 157,216 5,907 939,322 796,835 195,971 6 992,812 Insurance for mutual aid association, 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 For the year ended December 31, 2022 Stage 1 (12,146) - - - 827 714 (1,200) (11,805) Stage 2 Stage 3 - - - - - - - - - - - - - - - - For the year ended December 31, 2021 Stage 1 (9,631) - - - (4,909) 2,378 16 (12,146) Stage 2 Stage 3 - - - - - - - - - - - - - - - - Total (12,146) - - - 827 714 (1,200) (11,805) Total (9,631) - - - (4,909) 2,378 16 (12,146) 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 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 Disposal Others (*) Ending balance (*) Others consist of foreign currencies translation, etc. - 93 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2) Gross carrying amount For the year ended December 31, 2022 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 Acquisition Disposal / Recovery Gain (loss) on valuation Amortization based on effective interest method Others (*) Ending balance 38,126,977 - - - 16,108,426 (21,670,160) (669,936) 41,813 208,638 32,145,758 (*) Others consist of foreign currencies translation, etc. - - - - - - - - - - - - - - - - - - - - 38,126,977 - - - 16,108,426 (21,670,160) (669,936) 41,813 208,638 32,145,758 For the year ended December 31, 2021 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 Acquisition Disposal / Recovery Gain (loss) on valuation Amortization based on effective interest method Others (*) Ending balance 28,948,141 - - - 30,522,426 (21,533,360) (213,517) 31,641 371,646 38,126,977 (*) Others consist of foreign currencies translation, etc. - - - - - - - - - - - - - - - - - - - - 28,948,141 - - - 30,522,426 (21,533,360) (213,517) 31,641 371,646 38,126,977 (4) During the years ended December 31, 2022 and 2021, the Group sold its equity securities., designated as financial assets at FVTOCI in accordance with decision of disposal by the creditors, and the fair values at disposal dates were 3,567 million won and 138,511 million won, respectively and cumulative gains and losses at disposal dates were 14,444 million won in gain and 3,062 million won in loss, respectively. - 94 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 9. SECURITIES AT AMORTIZED COST (1) Details of securities at amortized cost as of December 31, 2022 and 2021 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, 2022 December 31, 2021 10,083,951 10,283,631 6,237,547 1,671,772 (8,385) 28,268,516 8,882,500 1,835,947 5,818,646 554,416 (5,235) 17,086,274 (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 provision of loss allowance Others (*) Ending balance (*) Changes due to 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 (*) Changes due to foreign currencies translation, etc. For the year ended December 31, 2022 Stage 1 Stage 2 Stage 3 Total (5,235) - - - (3,151) 1 (8,385) - - - - - - - - - - - - - - (5,235) - - - (3,151) 1 (8,385) For the year ended December 31, 2021 Stage 1 Stage 2 Stage 3 Total (4,566) - - - (664) (5) (5,235) - - - - - - - - - - - - - - (4,566) - - - (664) (5) (5,235) - 95 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2) Gross carrying amount For the year ended December 31, 2022 Beginning balance Transfer to 12-month expected credit losses Transfer to lifetime expected credit losses Transfer to credit-impaired financial assets Acquisition Disposal / Recovery Amortization based on effective interest method Others (*) Ending balance (*) Changes due to foreign currencies translation, etc. Stage 1 17,091,509 - - - 16,873,194 (5,871,234) 86,212 97,220 28,276,901 Stage 2 Stage 3 - - - - - - - - - Total 17,091,509 - - - 16,873,194 (5,871,234) 86,212 97,220 28,276,901 - - - - - - - - - For the year ended December 31, 2021 Beginning balance Transfer to 12-month expected credit losses Transfer to lifetime expected credit losses Transfer to credit-impaired financial assets Acquisition Disposal / Recovery Amortization based on effective interest method Others (*) Ending balance (*) Changes due to foreign currencies translation, etc. Stage 1 17,025,405 - - - 6,435,692 (6,425,408) 14,810 41,010 17,091,509 Stage 2 Stage 3 - - - - - - - - - Total 17,025,405 - - - 6,435,692 (6,425,408) 14,810 41,010 17,091,509 - - - - - - - - - - 96 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 10. LOANS AND OTHER FINANCIAL ASSETS AT AMORTIZED COST (1) Details of loans and other financial assets at amortized cost as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Due from banks Loans Other financial assets Total December 31, 2022 December 31, 2021 2,994,672 343,918,560 8,847,497 355,760,729 2,866,884 336,799,510 9,219,223 348,885,617 (2) Details of due from banks are as follows (Unit: Korean Won in millions): December 31, 2022 December 31, 2021 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 Sub-total Due from banks in foreign currencies: Due from banks on demand Due from banks on time Others Loss allowance Sub-total Total 160,000 170,006 183 2,440 421,318 (116) 753,831 199,671 466,963 1,586,408 (12,201) 2,240,841 2,994,672 600,000 159,264 14,146 54 191,501 (2,452) 962,513 194,781 205,351 1,507,821 (3,582) 1,904,371 2,866,884 (3) Details of restricted due from banks are as follows (Unit: Korean Won in millions): Counterparty December 31, 2022 Reason of restriction Due from banks in local currency: Due from BOK BOK Due from KSFC Others The Korea Securities Finance Corporation Korea Exchange and others Sub-total Due from banks in foreign currencies: Due from banks on demand Due from banks on time Others BOK and others National Bank Cambodia Korea Investment & Securities and others Sub-total Total 160,000 Reserve deposits under BOK Act Customer deposits 2,419 return reserve Korean Won CCP margin and 223,705 386,124 others Reserve deposits under BOK 193,507 Act and others 253 Reserve deposits and others Overseas futures and options trade deposits and others 1,581,298 1,775,058 2,161,182 - 97 - Due from banks on demand Foreign currency deposits on time Others WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Counterparty December 31, 2021 Reason of restriction Due from banks in local currency: Due from BOK The BOK Due from KSFC Others KB Securities Co. Ltd. Korea Federation of Savings Banks and others Sub-total Due from banks in foreign currencies: 600,000 Reserve deposits under the BOK Act 54 Futures trading margin Guarantees, mortgage of domestic exchange transactions and others 75,897 675,951 The BOK and others 128,492 Act and others Reserve deposits under the BOK National Bank Cambodia Korea Investment & Securities and others Sub-total Total 237 Reserve deposits and others Overseas futures and options trade deposits and others 1,502,474 1,631,203 2,307,154 (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, 2022 Stage 1 Stage 2 Stage 3 Beginning balance Transfer to 12-month expected credit losses Transfer to lifetime expected credit losses Transfer to credit-impaired financial assets Provision for allowance for credit loss Others (*) Ending balance (6,034) - - - (7,702) 1,419 (12,317) - - - - - - - - - - - - - - Total (6,034) - - - (7,702) 1,419 (12,317) (*) Changes due to 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 Provision for allowance for credit loss Others (*) Ending balance (*) Changes due to foreign currencies translation, etc. For the year ended December 31, 2021 Stage 1 Stage 2 Stage 3 Total (4,366) - - - (1,477) (191) (6,034) - - - - - - - - - - - - - - (4,366) - - - (1,477) (191) (6,034) - 98 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2) Gross carrying amount For the year ended December 31, 2022 Beginning balance Transfer to 12-month expected credit losses Transfer to lifetime expected credit losses Transfer to credit-impaired financial assets Net decrease Others (*) Ending balance (*) Changes due to foreign currencies translation, etc. Stage 1 2,872,918 - - - 166,693 (32,622) 3,006,989 Stage 2 Stage 3 - - - - - - - Total 2,872,918 - - - 166,693 (32,622) 3,006,989 - - - - - - - For the year ended December 31, 2021 Beginning balance Transfer to 12-month expected credit losses Transfer to lifetime expected credit losses Transfer to credit-impaired financial assets Net decrease Others (*) Ending balance (*) Changes due to foreign currencies translation, etc. Stage 1 2,515,273 - - - 282,987 74,658 2,872,918 (5) Details of loans are as follows (Unit: Korean Won in millions): Stage 2 Stage 3 - - - - - - - Total 2,515,273 - - - 282,987 74,658 2,872,918 - - - - - - - December 31, 2022 December 31, 2021 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 Financial lease receivables Installment financial bond Others Loan origination costs and fees Discounted present value Allowance for credit losses Total 282,686,620 26,988,360 2,877,079 10,370,362 3,650,792 533,879 25,469 25,698 485,519 2,990,937 3,626,226 6,849,038 1,467,858 2,832,972 140 852,002 (10,238) (2,334,153) 343,918,560 273,283,542 24,508,250 3,403,021 9,757,115 5,310,080 265,275 17,406 26,766 519,150 2,874,480 3,481,219 10,332,858 1,173,751 2,882,396 159 858,051 (7,299) (1,886,710) 336,799,510 - 99 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (6) Changes in the loss allowance of loans are as follows (Unit: Korean Won in millions): For the year ended December 31, 2022 Consumers Corporates Beginning balance Transfer to 12-month expected credit losses Transfer to lifetime expected credit losses Transfer to credit-impaired financial assets Stage 1 (136,520) Stage 2 Stage 1 (97,604) (206,617) (362,766) (576,740) (251,233) Stage 3 Stage 2 Stage 3 (21,684) 21,210 474 (74,402) 68,546 5,856 10,211 (11,568) 1,357 18,678 (21,502) 2,824 3,960 8,975 (12,935) 2,217 12,769 (14,986) Net reversal(provision) of allowance for credit losses Recovery Charge-off Disposal Interest income from impaired loans Others Changes due to business combinations Ending balance (734) - - - - (4,350) 1,241 (147,876) (49,398) (156,286) (70,077) 161,850 21,862 11,805 (948) 7,573 (22,646) (303,198) (107,038) (55,743) - 140,744 - 37,722 280 9,576 - (97) (479) (9,090) (14,503) (128,089) (241,942) (453,621) (818,234) (241,465) - - 128 - (84) 1,847 - - 62 - (495) 729 Credit card accounts For the year ended December 31, 2022 Total 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 allowance for credit losses Recovery Charge-off Disposal Interest income from impaired loans Others Changes due to business combinations Ending balance Stage 1 Stage 2 (68,814) (115,489) Stage 3 (70,927) (568,100) (789,833) (528,777) Stage 2 Stage 3 Stage 1 (31,360) 31,284 76 (127,446) 121,040 6,406 7,576 (7,694) 118 36,465 (40,764) 4,299 642 2,190 (2,832) 6,819 23,934 (30,753) 20,820 - - - - - (3) (71,139) (38,105) (204,569) (53,988) 220,280 7,896 - - - (2,560) (390,701) (467,893) - (179,808) - 522,874 - - 67,480 190 - 21,381 - - (1,045) (579) (4,829) (1,517) 2,576 (13,265) (127,814) (103,946) (672,636) (1,074,137) (587,353) - - - - - - - 100 - Credit impairment model - - - - (27) - - - - - - (27) Credit impairment model - - - - (27) - - - - - - (27) WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 For the year ended December 31, 2021 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 Stage 1 (121,527) (23,328) 9,201 2,752 (4,456) - - - - 838 (136,520) Stage 3 Corporates Stage 2 19,736 (11,466) 9,918 Consumers Stage 2 Stage 3 Stage 1 (84,463) (205,693) (327,460) (521,907) (388,744) 30,901 (80,803) 21,600 14,106 1,562 (20,303) (91,981) (168,323) 49,562 (55,108) - 233,507 - 64,078 - 12,672 - 18,487 (19,733) (97,604) (206,617) (362,766) (576,740) (251,233) 3,592 2,265 (12,670) (32,764) (130,424) (75,058) 174,012 14,890 13,743 8,726 - - - - 1,435 - - - - 4,211 49,902 (35,706) 18,741 For the year ended December 31, 2021 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 Stage 3 Total Stage 2 26,581 (8,151) 925 Stage 1 (62,712) (26,846) 7,497 356 12,894 - - - - (3) Credit card accounts Stage 2 Stage 3 Stage 1 (90,481) (105,537) (511,699) (696,851) (699,974) 34,758 96,219 265 (130,977) 24,519 (55,323) 30,804 654 4,670 (34,254) 29,584 (1,281) 58,000 (169,108) (444,083) (44,363) (145,336) - (195,786) (65,620) 627,871 - 220,352 104,544 - 25,576 26,415 - - 27,213 5,646 - (70,927) (568,100) (789,833) (528,777) - - - - - (68,814) (115,489) - - - - (18,898) - 101 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (7) Changes in the gross carrying amount of loans are as follows (Unit: Korean Won in millions): For the year ended December 31, 2022 Consumers Corporates Stage 1 Stage 2 135,139,685 13,500,783 Stage 3 Stage 1 499,969 170,795,255 8,458,279 Stage 2 Stage 3 541,732 4,651,157 (4,637,460) (13,697) 1,784,684 (1,768,655) (16,029) (6,284,951) 6,303,526 (18,575) (3,773,713) 3,792,473 (18,760) Credit impairment model - - - (157,808) - - (2,082,449) 57,743 (102,097) - (259) (1,046,885) 2,974 131,323,377 14,020,582 (123,225) (242,421) 259,905 - - (161,850) (391) (57,052) (48,472) (873,200) 47,727 11,005,551 1,016 31,551 7,630 564,057 179,552,435 9,486,297 365,646 (140,744) (134,732) 28,198 687 625,998 - - - 313,717 - 313,717 Credit card accounts Total For the year ended December 31, 2022 Stage 1 8,239,303 1,395,139 Stage 2 Stage 1 Stage 3 116,075 314,174,243 23,354,201 Stage 2 Stage 3 1,157,776 542,021 (541,913) (108) 6,977,862 (6,948,028) (29,834) (403,398) 403,598 (200) (10,462,062) 10,499,597 (37,535) (31,780) - - 769,314 - 9,115,460 (21,244) - - (169,200) - 1,066,380 (432,009) - (48,472) 53,024 (220,280) (17,082) 247,981 - (246,566) - (650) 9,697,416 (2,089,285) 3,990 89,294 179,410 319,996,272 24,573,259 678,575 (522,874) (208,866) 323,906 8,317 1,369,465 Credit impairment model - - - - - - 313,717 - 313,717 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) Changes due to business combinations 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) Changes due to business combinations Ending balance For the year ended December 31, 2021 Stage 1 Consumers Stage 2 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 (108,717) 125,990,038 12,016,711 (4,357,347) 4,377,247 (6,104,417) 6,127,477 (79,746) - - - - (206,312) 10,985,534 135,139,685 13,500,783 Corporates Stage 2 Stage 3 Stage 1 537,106 149,574,932 7,328,741 1,610,541 (1,575,157) (19,900) (3,627,800) 3,670,808 (23,060) (244,236) (132,986) 188,463 - - (174,012) - - (48,795) (833,127) 23,481,818 40,167 499,969 170,795,255 8,458,279 Stage 3 717,909 (35,384) (43,008) 377,222 (233,507) (187,571) (53,929) 541,732 For the year ended December 31, 2021 Credit card accounts Stage 2 Stage 1 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 7,278,975 1,078,220 (358,776) 359,101 514,369 (513,635) (9,253) (17,416) - - - - 1,132,278 170,579 8,239,303 1,395,139 - 102 - Stage 1 Stage 3 180,074 282,843,945 (325) 6,346,889 (734) (10,245,852) (370,369) 26,669 - (220,352) (56,520) - 187,263 35,599,630 116,075 314,174,243 Total Stage 2 Stage 3 20,423,672 1,435,089 (55,609) (6,291,280) (66,802) 10,312,654 592,354 (221,985) (627,871) - (292,886) - 173,501 (868,860) 23,354,201 1,157,776 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (8) Details of other financial assets are as follows (Unit: Korean Won in millions): Cash Management Account asset (CMA asset) Receivables Accrued income Telex and telephone subscription rights and refundable deposits Domestic exchange settlement debit Other assets (*) Allowance for credit losses Total December 31, 2022 December 31, 2021 157,000 5,438,469 1,667,397 801,536 577,919 344,356 (139,180) 8,847,497 140,000 6,852,139 1,049,857 870,707 82,555 290,746 (66,781) 9,219,223 (*) The Group became aware of employee embezzlement incidents that occurred before the end of April 2022, and the Financial Supervisory Service conducted on-site inspections from April 28 to May 30, 2022. An accusation of embezzlement and provisional seizure of found property were made, and an investigation by an investigative agency is currently underway. The related amount included in other assets amounted to 63,354 million Won, which was treated as a loss in its entirety because its recoverability was uncertain. (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 Reversal (provision) of loss allowance Charge-off Disposal Others Ending balance Beginning balance Transfer to 12-month expected credit losses Transfer to lifetime expected credit losses Transfer to credit-impaired financial assets Reversal (provision) of loss allowance Charge-off Disposal Others Ending balance For the year ended December 31, 2022 Stage 1 Stage 2 Stage 3 (3,675) (261) 209 981 (1,749) - - 317 (4,178) (5,580) 246 (225) 1,134 (4,707) - - (1) (9,133) (57,526) 15 16 (2,115) (6,329) 2,223 751 (62,904) (125,869) For the year ended December 31, 2021 Stage 1 Stage 2 Stage 3 (3,666) (228) 147 167 511 - - (606) (3,675) (5,450) 217 (174) 288 (464) - - 3 (5,580) (74,179) 11 27 (455) 4,664 9,965 1,400 1,041 (57,526) Total (66,781) - - - (12,785) 2,223 751 (62,588) (139,180) Total (83,295) - - - 4,711 9,965 1,400 438 (66,781) - 103 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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) Changes due to business combinations 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, 2022 Stage 1 9,004,539 9,765 (38,248) (1,484) - (5) (88,214) 368 8,886,721 Stage 2 106,597 Stage 3 174,868 (9,749) 38,265 (2,824) - - (110,835) - 21,454 (16) (17) 4,308 24 (917) (99,748) - 78,502 For the year ended December 31, 2021 Stage 1 7,267,426 8,909 (27,369) (1,877) - - 1,757,450 9,004,539 Stage 2 76,418 (8,894) 27,399 (1,638) - - 13,312 106,597 Stage 3 188,187 (15) (30) 3,515 (9,965) (1,716) (5,108) 174,868 Total 9,286,004 - - - 24 (922) (298,797) 368 8,986,677 Total 7,532,031 - - - (9,965) (1,716) 1,765,654 9,286,004 - 104 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 11. FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES (1) The fair value hierarchy The fair value hierarchy for financial instruments is determined by the amount of observable market data. The specific financial instruments characteristics and market condition such as the existence of the transactions among market participants 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. - 105 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) Fair value hierarchy of financial assets and liabilities measured at fair value are as follows (Unit: Korean Won in millions): Financial assets: Financial assets at FVTPL Deposits Debt securities Equity securities Capital contributions Beneficiary certificates Loans Derivative assets Other financial assets in foreign currency Others Sub-total Financial assets at FVTOCI Debt securities Equity securities Sub-total Derivative assets (designated for hedging) Total Financial liabilities: Financial liabilities at FVTPL Deposits due to customers Derivative liabilities Securities sold Sub-total Derivative liabilities (designated for hedging) Total Level 1 (*) Level 2 (*) Level 3 Total December 31, 2022 34,995 2,580,563 76,007 - 45,394 - 69,316 - 34,299 2,840,574 9,895,456 382,257 10,277,713 - 13,118,287 - 1,654,591 25 - 2,398,592 794,723 8,042,895 - - 12,890,826 22,250,302 - 22,250,302 37,786 35,178,914 - 1,078 307,851 1,976,474 1,458,776 104,505 93,970 41,679 144,840 4,129,173 34,995 4,236,232 383,883 1,976,474 3,902,762 899,228 8,206,181 41,679 179,139 19,860,573 - 557,065 557,065 - 4,686,238 32,145,758 939,322 33,085,080 37,786 52,983,439 35,161 11,700 12,113 58,974 - 8,883,976 - 8,883,976 - 9,449 - 9,449 35,161 8,905,125 12,113 8,952,399 - 58,974 202,911 9,086,887 - 9,449 202,911 9,155,310 (*) Among financial assets and financial liabilities measured at fair value, the amount transferred from Level 2 to Level 1 is 2,835,187 million Won. The Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions have changed. A change in the judgement of the active market where the financial product was traded resulted the transfer between levels. - 106 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Financial assets: Financial assets at FVTPL Deposits Debt securities Equity securities Capital contributions Beneficiary certificates Loans Derivative assets Others Sub-total Financial assets at FVTOCI Debt securities Equity securities Sub-total Derivative assets (Designated for hedging) Total Financial liabilities: Financial liabilities at FVTPL Deposits due to customers Derivative liabilities Securities sold Sub-total Derivative liabilities (Designated for hedging) Total Level 1 (*) Level 2 (*) Level 3 Total December 31, 2021 65,072 817,584 25,879 - 74,271 - 10,911 - 993,717 - 1,923,538 - - 2,326,202 453,832 4,762,872 - 9,466,444 - 2,117 303,985 1,287,723 1,104,074 213,635 29,348 96,191 3,037,073 65,072 2,743,239 329,864 1,287,723 3,504,547 667,467 4,803,131 96,191 13,497,234 5,578,455 411,357 5,989,812 - 6,983,529 32,548,522 - 32,548,522 ` 106,764 42,121,730 - 581,455 581,455 - 3,618,528 38,126,977 992,812 39,119,789 106,764 52,723,787 65,016 10,259 211,408 286,683 - 4,552,368 29,766 4,582,134 - 4,641 - 4,641 65,016 4,567,268 241,174 4,873,458 - 286,683 27,584 4,609,718 - 4,641 27,584 4,901,042 (*) 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. - 107 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Financial assets and liabilities at FVTPL, financial liabilities at FVTPL designated as upon initial recognition, financial assets at FVTOCI, and derivative assets and liabilities 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, 2022 and 2021 are as follows: Debt securities Beneficiary certificates Valuation methods Fair value is measured by discounting the future cash flows of debt securities applying the risk-free market rate with credit spread. The beneficiary certificates classified as Level 2 are MMF and are measured at the standard price. Input variables Risk-free market rate and credit spread Values of underlying assets such as bond Derivatives Fair value is measured by models such as option Discount rate, values of underlying model (Closed form), DCF model, FDM and Monte Carlo Simulation. assets such as foreign exchange rate and stock prices, volatility, risk-free market rate, forward rate, etc. Loans The future cash flows of debt instruments are Risk-free market rate and credit spread measured at a discount by applying the market interest rate applied to entities with similar creditworthiness to the debtor. 2) Valuation methods and input variables for each type of financial instrument classified into level 3 in December 31, 2022 and 2021 are as follows: Loans Fair value is calculated by using Binomial Tree, LSMC Valuation methods and Discounted Cash Flow Model which is a valuation technique commonly used in the market taking into account value of underlying assets, volatility, discount rate. Input variables Value of underlying assets, Volatility, Discount rate Debt securities Equity securities, capital contributions and Beneficiary certificates The future cash flows of debt instruments are measured at a discount by applying the market interest rate applied to entities with similar creditworthiness to debt securities issuers. Fair value is measured by models such as LSMC(Least-Squares Monte Carlo), Hull-white. 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, Net Asset Value Method, LSMC, and Binomial Tree, Imputed Market Value Model more than one method is used given the characteristic of the subject of fair value measurement. Risk-free market rate, credit spread, discount rate originated credit grade, volatility of stock price, volatility of interest rate Risk-free market rate, market risk premium, corporate Beta, discount rate originated credit grade, stock prices, volatility of underlying asset, net asset value, volatility of stock price, volatility of interest rate, Capital increase amount, Fluctuation rate of real estate sale price, etc Derivatives Fair value is measured by models such as option model Discount rate, values of underlying (Closed form), DCF model, FDM and Monte Carlo Simulation. assets such as foreign exchange rate and stock prices, volatility, etc. Others The fair value of the underlying asset, after calculating the fair value using the DCF model, etc., considering the price and volatility of the calculated underlying asset, is calculated using the binomial tree and least- squares Monte Carlo simulation (LSMC), which are commonly used valuation techniques in the market. Stock prices, volatility of underlying assets, etc. - 108 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 Significant unobservable inputs Range(%) 46.53% Stock prices Loans Type Impact of changes in significant unobservable inputs on fair value measurement Variation of fair value increases as volatility of underlying asset and stock price increases. DCF model Discount rate 1.98%~2.18% Fair value decreases as discount Derivative assets Option Equity related Correlation coefficient 0.21~0.67 rate increases. Variation of fair value increases as correlation coefficient increases. Derivative liabilities valuation model and others Option valuation model and others Equity securities, Binomial Tree Equity related capital contributions, and beneficiary certificates Correlation coefficient Volatility of underlying asset 0.21~0.67 Variation of fair value increases as correlation coefficient increases. 11.74% ~ 97.16% Variation of fair value increases as Stock prices, Volatility of underlying asset 28.40% volatility of underlying assets increases. Variation of fair value increases as volatility of underlying asset and stock price increases. DCF model and others Discount rate 0.00%~19.14% Fair value increases as discount rate Terminal growth rate 0.00%, 1.00% Fair value increases as terminal growth rate increases. Liquidation value 0.00% Fair value increases as liquidation decreases. Others Binomial Tree Stock prices, Volatility of underlying asset 20.15%~36.19% value increases. Variation of fair value increases as volatility of underlying asset and stock price 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. - 109 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) Changes in financial assets and liabilities measured at fair value classified into Level 3 are as follows (Unit: Korean Won in millions): Beginning balance Net income (loss) (*1) Other comprehensive income Purchases/ issuances Disposals / settlements Transfer to or out of Level 3 (*2) Ending balance For the year ended December 31, 2022 Financial assets: Financial assets at FVTPL Debt securities Equity securities Capital contributions Beneficiary certificates Loans Derivative assets Other foreign currency financial assets Others Sub-total Financial assets at FVTOCI Equity securities Total Financial liabilities: Financial liabilities at FVTPL Derivative liabilities Total 2,117 303,985 1,287,723 1,104,074 213,635 29,348 (40) 697 103,376 (2,922) 17,544 64,359 - 96,191 3,037,073 - 16,744 199,758 - - - - - - - - 20,175 703,160 98,420 802,092 582 (999) (16,974) (117,785) 259,204 (928,766) (319) - (32) - 1,078 307,851 1,976,474 - - - 1,458,776 104,506 93,970 41,679 40,836 1,706,944 - (8,931) (814,570) - - (32) 41,679 144,840 4,129,173 581,455 3,618,528 - 199,758 2,084 2,084 2,357 1,709,301 (28,831) (843,401) - (32) 557,065 4,686,238 4,641 4,641 8,058 8,058 - - (351) (351) (2,899) (2,899) - - 9,449 9,449 (*1) For financial liabilities, positive numbers represent losses that increase balance and negative numbers represent gains that decrease balance. The gain amounting to 2,770 million Won for the year ended December 31, 2022, which is from financial assets and liabilities that the Group holds as at the end of the year. (*2) There were transfers between levels as the availability of observable market data for these financial instruments changed. The Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions have changed. - 110 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 For the year ended December 31, 2021 Beginning balance Net income (loss) (*1) Other comprehensive income Purchases/ issuances Disposals / settlements Transfer to or out of Level 3 (*2) Ending balance Financial assets: Financial assets at FVTPL Debt securities Equity securities Capital contributions Beneficiary certificates Loans Derivative assets Others Sub-total Financial assets at FVTOCI Equity securities Total Financial liabilities: Financial liabilities at FVTPL Derivative liabilities Financial liabilities at FVTPL designated as upon initial recognition Equity-linked securities Total 4,618 450,371 865,685 1,917,811 209,062 7,872 84,979 3,540,398 (431) (24,501) 82,596 10,347 16,975 22,256 12,245 119,487 - - - - - - - - 1,000 33,570 575,643 86,224 761,045 5,058 14,982 1,477,522 (4,070) (154,455) (236,201) (910,308) (773,447) - (16,548) (2,095,029) 1,000 (1,000) - - - (5,838) 533 (5,305) 2,117 303,985 1,287,723 1,104,074 213,635 29,348 96,191 3,037,073 570,715 4,111,113 - 119,487 11,362 11,362 645 1,478,167 (1,267) (2,096,296) - (5,305) 581,455 3,618,528 20,136 4,926 - (3,979) (10,188) (6,254) 4,641 19,630 39,766 (102) 4,824 - - - (3,979) (19,528) (29,716) - (6,254) - 4,641 (*1) For financial liabilities, positive numbers represent losses that increase balance and negative numbers represent gains that decrease balance. The gain amounting to 2,634 million Won for the year ended December 31, 2021, which is from financial assets and liabilities that the Group holds as at the end of the year. (*2) There were transfers between levels as the availability of observable market data for these financial instruments changed. The Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions have changed. - 111 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) Sensitivity analysis results on reasonable fluctuation of the significant unobservable input variables for the fair value of Level 3 financial instruments are as follows. 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. Meanwhile, among the financial instruments that are classified as Level 3 amounting to 4,695,688 million won and 3,623,168 million won as of December 31, 2022 and 2021 respectively, equity instruments of 3,196,703 million won and 3,030,775 million won whose carrying amount are considered to represent the reasonable approximation of fair value are excluded from the sensitivity analysis. The sensitivity on fluctuation of input variables by financial instruments as of December 31, 2022 and 2021 is as follows (Unit: Korean Won in millions): Financial assets: Financial assets at FVTPL Derivative assets (*1) Loans (*2) Debt securities Equity securities (*2) (*3) (*4) Beneficiary certificates (*4) Others (*2) Financial assets at FVTOCI Equity securities (*3) (*4) Total Financial liabilities: Financial liabilities at FVTPL Derivative liabilities (*1) Total December 31, 2022 Net income (loss) Other comprehensive income (loss) Favorable Unfavorable Favorable Unfavorable 2,453 203 1 10,146 737 2,860 - - 16,400 (1,993) (200) - (8,079) (737) (2,790) - - (13,799) - - - - - - - 24,370 24,370 - - - - - - - (17,579) (17,579) 41 41 (39) (39) - - - - (*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%). The stock prices and volatility are major unobservable variables. (*3) Fair value changes of equity securities are calculated by increasing or decreasing terminal growth rate (- 0.5%~0.5%) 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 rate of real estate which is underlying assets and discount rate by 1%. - 112 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Financial assets: Financial assets at FVTPL Derivative assets (*1) Loans (*2) Debt securities Equity securities (*2) (*3) (*4) Beneficiary certificates (*4) Others (*2) Financial assets at FVTOCI Equity securities (*3) (*4) Total Financial liabilities: Financial liabilities at FVTPL Derivative liabilities (*1) Total December 31, 2021 Net income (loss) Other comprehensive income (loss) Favorable Unfavorable Favorable Unfavorable 1,668 682 13 6,348 1,305 921 - 10,937 (1,191) (671) (12) (5,331) (1,171) (876) - (9,252) - - - - - - - - - - - - 30,391 30,391 (23,865) (23,865) 205 205 (264) (264) - - - - (*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%). The stock prices and volatility are major unobservable variables. (*3) Fair value changes of equity securities are calculated by increasing or decreasing terminal growth rate (- 0.5%~0.5%) 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 rate of real estate which is underlying assets and discount rate by 1%. - 113 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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, 2022 Fair value Level 1 Level 2 Level 3 Total Carrying amount 2,652,449 24,623,369 - 27,275,818 28,268,516 - 6,238,724 345,952,544 352,191,268 355,760,730 - 343,931,576 26,063,256 - 42,918,411 - 21,244,664 - 2,135,047 - 536,209 - 343,931,576 28,198,303 42,918,411 21,780,873 342,105,209 28,429,603 44,198,486 22,492,705 December 31, 2021 Fair value Level 1 Level 2 Level 3 Total Carrying amount 2,122,401 14,921,119 - 17,043,520 17,086,274 - 3 346,871,245 346,871,248 348,885,617 - 318,070,829 23,393,520 - 44,500,963 - 23,154,733 - 1,270,305 - 379,534 - 318,070,829 24,663,825 44,500,963 23,534,267 317,899,871 24,755,459 44,653,864 23,827,821 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 The fair value is measured by discounting the projected Valuation methods cash flows of debt securities by applying risk-free market rate with credit spread. Input variables Risk-free market rate and credit spread 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 and prepayment rate 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, credit spread and forward rate - 114 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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 Financial liabilities Deposits due to customers Borrowings Debentures Derivative liabilities Other financial liabilities Total Financial assets Deposits Securities Loans Derivative assets Other financial assets Total Financial liabilities Deposits due to customers Borrowings Debentures Derivative liabilities Other financial liabilities Total December 31, 2022 Financial asset at FVTPL Financial assets at FVTOCI 34,995 10,676,985 899,228 8,206,181 43,184 19,860,573 - 33,085,080 - - - 33,085,080 Financial assets at amortized cost 2,994,672 28,268,516 343,918,560 - 8,847,497 384,029,245 Derivatives assets (designated for hedging) - - - 37,786 - 37,786 Total 3,029,667 72,030,581 344,817,788 8,243,967 8,890,681 437,012,684 December 31, 2022 Financial liabilities at FVTPL Financial liabilities at amortized cost Derivatives liabilities (designated for hedging) 35,161 12,113 - 8,905,125 - 8,952,399 342,105,209 28,429,603 44,198,486 - 22,492,707 437,226,005 - - - 202,911 - 202,911 December 31, 2021 Financial asset at FVTPL Financial assets at FVTOCI 65,072 7,960,046 667,467 4,803,131 1,518 13,497,234 - 39,119,789 - - - 39,119,789 Financial assets at amortized cost 2,866,884 17,086,274 336,799,510 - 9,219,223 365,971,891 December 31, 2021 Financial liabilities at FVTPL Financial liabilities at amortized cost Derivatives liabilities (designated for hedging) 65,016 241,174 - 4,567,268 - 4,873,458 317,899,871 24,755,459 44,653,864 - 23,827,821 411,137,015 - - - 27,584 - 27,584 Total 342,140,370 28,441,716 44,198,486 9,108,036 22,492,707 446,381,315 Derivatives assets (designated for hedging) - - - 106,764 - 106,764 Total 317,964,887 24,996,633 44,653,864 4,594,852 23,827,821 416,038,057 - 115 - Total 2,931,956 64,166,109 337,466,977 4,909,895 9,220,741 418,695,678 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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, 2022 and 2021 are as follows (Unit: Korean Won in millions): For the year ended December 31, 2022 Interest Income (expense) Fees and Commissions Income (expense) Reversal (provision) of credit loss 106,698 (134) - Gain or loss on transactions and valuation 238,502 Dividends, etc. 136,136 Total 481,202 632,615 1,606 827 (21,498) 23,846 637,396 515,246 - (3,151) - - 512,095 13,399,990 600,902 (881,668) 74,204 - 13,193,428 (5,950,277) 2,094 - - - (5,948,183) Financial assets at FVTPL Financial assets at FVTOCI Securities at amortized cost Loans and other financial assets at amortized cost Financial liabilities at amortized cost Net derivatives (designated for hedging) Total - 8,704,272 - 604,468 - (883,992) 78,822 370,030 - 159,982 78,822 8,954,760 For the year ended December 31, 2021 Interest Income (expense) Fees and Commissions Income (expense) Reversal (provision) of credit loss 45,803 (156) - Gain or loss on transactions and valuation 325,751 Dividends, etc. 284,683 Total 656,081 381,814 1,343 (4,909) 32,624 24,528 435,400 324,920 - (664) - - 324,256 9,142,212 494,296 (551,957) 107,317 - 9,191,868 (2,901,592) 2,205 - - - (2,899,387) Financial assets at FVTPL Financial assets at FVTOCI Securities at amortized cost Loans and other financial assets at amortized cost Financial liabilities at amortized cost Net derivatives (designated for hedging) Total - 6,993,157 - 497,688 - (557,530) 72,493 538,185 - 309,211 72,493 7,780,711 - 116 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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): Assets transferred Financial assets at FVTPL Financial assets at FVTOCI Securities at amortized cost Related liabilities Total Bonds sold under repurchase agreements 214,577 583,198 1,171,300 1,969,075 1,898,744 248,009 127,065 38,995 414,069 749,976 December 31, 2022 December 31, 2021 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 amount of the securities loaned are as follows (Unit: Korean Won in millions): Financial assets at FVTOCI Korean treasury and government bonds December 31, 2022 December 31, 2021 Loaned to Korea Securities 98,027 98,535 Finance Corporation 3) Liquidity of financial assets As of December 31, 2022 and 2021, the consolidated structured companies issued asset-backed securities with loans and corporate bonds held by the Group as liquid assets, and the Group bear related risks through the purchase agreements or credit contributions. The transaction details of the transfer of the financial instrument are as follows: Assets transferred Related liabilities Financial assets at FVPL Loans at amortized cost Asset-backed borrowings Asset-backed bonds (*) The carrying amount is the amount before the allowance for bad debts. December 31, 2022 Carrying amount (*) December 31, 2021 Carrying amount (*) 151,930 4,682,882 2,424,080 978,274 49,808 4,640,182 231,800 1,209,364 On the other hand, the details of transferred financial assets that have not been removed, such as bonds sold under the repurchase agreement and loan securities, are also described in Note 18. The Group does not have financial instruments that are continuously involved. - 117 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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 has been offset with a part of unpaid domestic exchange payables, and they have 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. 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, 2022 and 2021, the financial instruments to be offset and may be covered by master netting agreements and similar agreements are as follows (Unit: Korean Won in millions): December 31, 2022 Related amounts not setoff in the consolidated statement of financial position Cash collateral received and others Netting agreements and others Net amounts 9,175,416 748,981 1,616,779 Net amounts of consolidated financial assets presented 7,032,465 4,508,711 6,793,938 6,793,938 - - Gross amounts of recognized financial assets Gross amounts of recognized financial assets setoff 7,032,465 4,508,711 6,793,938 - - - 39,787,371 39,209,452 58,122,485 39,209,452 577,919 - 18,913,033 15,969,354 - 577,919 748,981 2,194,698 7,652,440 4,508,615 2,313,044 - - - 7,652,440 4,508,615 10,043,092 145,268 1,972,695 2,313,044 2,313,044 - - 43,841,373 58,315,472 39,209,452 39,209,452 2,504,062 4,631,921 19,106,020 14,860,198 - 2,127,859 145,268 4,100,554 Financial assets: Derivative assets (*1) Receivable spot exchange (*2) Bonds purchased under resale agreements (*2) Domestic exchange settlement debits (*2) (*5) Total Financial liabilities: Derivative liabilities (*1) Payable spot exchange (*3) Bonds sold under repurchase agreements (*4) Domestic exchange settlement credits (*3) (*5) Total (*1) The items include derivative assets and liabilities held for trading and designated for hedging. (*2) The items are included in loan at amortized cost and other financial assets. (*3) The items are included in other financial liabilities. (*4) The items are included in borrowings. (*5) Certain financial assets and liabilities are presented as net amounts. - 118 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 December 31, 2021 Gross amounts of recognized financial assets Gross amounts of recognized financial assets setoff Net amounts of consolidated financial assets presented Related amounts not setoff in the consolidated statement of financial position Cash collateral received and others Netting agreements and others Net amounts 4,172,737 5,915,304 - - 4,172,737 5,915,304 8,260,784 552,071 1,275,186 10,332,858 - 10,332,858 10,332,858 - - 42,358,138 42,275,583 62,779,037 42,275,583 82,555 - 20,503,454 18,593,642 - 82,555 552,071 1,357,741 3,708,263 5,916,800 749,976 - - - 3,708,263 5,916,800 8,755,492 114,716 754,855 749,976 749,976 - - 48,982,056 42,275,583 3,401,251 59,357,095 42,275,583 17,081,512 12,906,719 6,706,473 - 3,305,222 114,716 4,060,077 Financial assets: Derivative assets (*1) Receivable spot exchange (*2) Bonds purchased under resale agreements (*2) Domestic exchange settlement debits (*2) (*5) Total Financial liabilities: Derivative liabilities (*1) Payable spot exchange (*3) Bonds sold under repurchase agreements (*4) Domestic exchange settlement credits (*3) (*5) Total (*1) The items include derivative assets and liabilities held for trading and designated for hedging. (*2) The items are included in loan at amortized cost and other financial assets. (*3) The items are included in other financial liabilities. (*4) The items are included in borrowings. (*5) Certain financial assets and liabilities are presented as net amounts. - 119 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 13. INVESTMENTS IN JOINT VENTURES AND ASSOCIATES (1) Investments in associates accounted for using the equity method of accounting are as follows: Joint ventures and associates (*4) Main business Woori Bank W Service Networks Co., Ltd. (*1) Korea Credit Bureau Co., Ltd. Freight & staffing services (*2) Credit information Korea Finance Security Co., Ltd. (*1) Wongwang Co., Ltd. (*3) Sejin Construction Co., Ltd. (*3) ARES-TECH Co., Ltd. (*3) Reading Doctors Co., Ltd. (*3)(*11) Cultizm Korea LTD Co., Ltd. (*3) (*11) NK Eng Co., Ltd. (*3) Beomgyo.,Ltd. (*3) Woori Growth Partnerships New Technology Private Equity Fund 2016KIF-IMM Woori Bank Technology Venture Fund K BANK Co., Ltd. (*2) Woori Bank-Company K Korea Movie Asset Fund (*9) Partner One Value Up I Private Equity Fund IBK KIP Seongjang Dideemdol Security service Wholesale and real estate Construction Electronic component manufacturing Other services Wholesale and retail sales Manufacturing Telecommunication equipment retail sales Other financial services Other financial services Finance Other financial services Other financial services Percentage of ownership (%) December 31, 2021 December 31, 2022 Location Financial statements as of 4.9 9.9 15.0 29.0 29.6 4.9 Korea 2022.11.30(*5) 9.9 Korea 2022.12.31 15.0 Korea 2022.11.30(*5) 29.0 Korea 29.6 Korea - - - - - - - 23.4 23.4 Korea - 35.4 Korea - 23.1 31.3 Korea 23.1 Korea 23.1 23.1 Korea 23.1 20.0 12.6 25.0 23.3 23.1 Korea 2022.12.31 20.0 Korea 12.6 Korea 2022.12.31 2022.12.31 25.0 Korea 2022.12.31 23.3 Korea 2022.12.31 1st Private Investment Limited Partnership Other financial services 20.0 20.0 Korea 2022.12.31 Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund LOTTE CARD Co., Ltd. Other financial services Credit card and installment financing Together-Korea Government Private Pool Private Securities Investment Trust No. 3 Other financial services Genesis Environmental Energy Company 1st Private Equity Fund(*8) Union Technology Finance Investment Association Dicustody Co., Ltd.(*2) Orient Shipyard Co., Ltd.(*3) Joongang Network Solution Co.,Ltd.(*3) Trust and collective investment Trust and collective investment Other information technology and computer operation related services Manufacture of sections for ships Other information technology and computer operation related services - 120 - 25.0 25.0 Korea 2022.12.31 20.0 20.0 Korea 2022.9.30(*5) 100.0 100.0 Korea 2022.12.31 - 24.8 Korea - 29.7 29.7 Korea 2022.12.31 1.0 22.7 1.0 Korea 2022.12.31 - Korea 2022.12.31 25.3 - Korea - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Percentage of ownership (%) December 31, 2021 December 31, 2022 Location Financial statements as of Joint ventures and associates (*4) BTS 2nd Private Equity Fund STASSETS FUND III Main business Other financial services Other financial services Woori Bank (*6) Japanese Hotel Real Estate Private Equity Fund No.2 Woori Seoul Beltway Private Special Asset Fund No.1 Woori Multi-Return Securities Investment Trust 3 (Balanced Bond) (*8) Woori Short-term Bond Securities Investment Trust(Bond) ClassC-F Woori Safe Plus General Type Private Investment Trust S- 8(Bond) Other financial services Trust and collective investment Collective investment business Collective investment business Collective investment business Woori Financial Capital Co., Ltd. WOORI TAERIM 1st Fund Portone-Cape Fund No.1 KIWOOM WOORI Financial 1st Fund (*7) DeepDive WOORI 2021-1 Financial Investment Fund (*7) Darwin Green Packaging Private Equity Fund DS Power Semicon Private Equity Fund Koreawide partners 2nd Private Equity Fund Other financial services Other financial services Other financial services Other financial services Other financial services Other financial services Other financial services Woori Investment Bank Co., Ltd. (*6) Woori FirstValue Private Real Estate Fund No.2 WooriG Real Infrastructure Blind General Type Private Placement Investment Trust Real estate business Investment trust and discretionary investment business Woori Asset Management Co. Ltd. Woori BIG2 Plus Securities Investment Trust(Balanced Bond)(*12) Woori Together TDF 2025(*12) Woori Together TDF 2030(*12) Woori Star50 feeder fund(H) (*12) Woori Private Equity Asset Management Co., Ltd. Collective investment business Collective investment business Collective investment business Collective investment business Woori Hanhwa Eureka Private Equity Fund (*10) Aarden Woori Apparel 1st Private Equity Fund (*2) Other financial services Other financial services - 121 - 20.0 28.3 19.9 25.0 - Korea 2022.12.31 - Korea 2022.12.31 19.9 Korea 2022.12.31 25.0 Korea 2022.12.31 - 20.0 Korea - 27.9 14.5 Korea 2022.12.31 9.2 - Korea 2022.12.31 25.6 20.0 9.1 11.9 20.4 21.0 26.7 25.6 Korea 2022.12.31 20.0 Korea 2022.12.31 9.1 Korea 2022.12.31 11.9 Korea 2022.12.31 20.4 Korea 2022.12.31 - Korea 2022.12.31 - Korea 2022.12.31 12.0 12.0 Korea 2022.12.31 0.1 0.3 Korea 2022.12.31 23.1 23.6 23.8 17.9 - 0.5 - Korea 2022.12.31 - Korea 2022.12.31 - Korea 2022.12.31 - Korea 2022.12.31 0.8 Korea - 0.5 Korea 2022.12.31 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Joint ventures and associates (*4) Woori Dyno 1st Private Equity Fund (*2) Australia Green Energy 1st PEF(*2) Main business Other financial services Other financial services Percentage of ownership (%) December 31, 2021 December 31, 2022 Location Financial statements as of 19.6 4.0 - Korea 2022.12.31 - Korea 2022.12.31 Japanese Hotel Real Estate Private Equity Fund 1 Godo Kaisha Oceanos 1 Woori G Japan Private Placement Real Estate Master Investment Trust No.2 Woori Zip 1 Woori Zip 2 Woori bank and Woori card Co., Ltd. (*6) Dongwoo C & C Co., Ltd. (*3) SJCO Co., Ltd. (*3) G2 Collection Co., Ltd. (*3) The Base Enterprise Co., Ltd. (*3) (*11) Kyesan Engineering Co., Ltd. (*3) Good Software Lap Co., Ltd. (*3) QTS Shipping Co., Ltd. (*3)(*11) DAEA SNC Co., Ltd. (*3) Force TEC Co., Ltd. PREXCO Co., Ltd. (*3) JiWon Plating Co., Ltd. (*3) Youngdong Sea Food Co., Ltd. (*3) KUM HWA Co., Ltd. Jinmyung Plus Co., Ltd. Woori bank and Woori Financial Capital Co., Ltd. (*6) JC Assurance No.2 Private Equity Fund Dream Company Growth no.1 PEF HMS-Oriens 1st Fund Other financial services Other financial services Other financial services Construction Aggregate transportation and wholesale Wholesale and retail sales Manufacturing Construction Service Complex transportation brokerage Wholesale and retail sales Manufacturing Manufacturing Plating Processed sea food manufacturing Telecommunication equipment retail sales Manufacturing Other financial services Other financial services Other financial services Woori G Senior Loan Private Placement Investment Trust No.1 Genesis Eco No.1 Private Equity Fund Paratus Woori Material Component Equipment joint venture company Collective investment business Other financial services Other financial services - 122 - 47.8 47.8 Japan 2022.10.31(*5) 64.0 64.0 63.9 Japan 2022.9.30(*5) 63.8 Japan 2022.9.30(*5) 24.5 24.5 Korea 29.8 29.2 - 23.3 29.4 29.7 Korea 29.2 Korea 48.4 Korea 23.3 Korea 29.4 Korea - 49.8 Korea - - - - - - - 25.5 24.5 28.1 20.8 24.5 20.1 21.3 23.5 27.8 22.8 21.7 29.0 25.5 Korea 24.5 Korea 28.1 Korea 20.8 Korea - 2022.9.30(*5) - - 24.5 Korea - 20.1 Korea 2022.09.30(*5) 21.3 Korea 2022.09.30(*5) 24.4 Korea 2022.09.30(*5) 27.8 Korea 2022.12.31 22.8 Korea 2022.12.31 21.7 Korea 2022.12.31 29.0 Korea 2022.12.31 29.9 29.9 Korea 2022.12.31 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Joint ventures and associates (*4) Midas No. 8 Private Equity Joint Venture Company Orchestra Private Equity Fund IV Synaptic Green No.1 PEF IGEN2022No. 1 Private Equity Fund Main business Other financial services Other financial services Other financial services Other financial services Percentage of ownership (%) December 31, 2021 December 31, 2022 Location Financial statements as of 28.5 28.2 21.1 24.8 28.5 Korea 2022.12.31 - Korea 2022.12.31 - Korea 2022.12.31 - Korea 2022.12.31 Woori Bank and Woori Investment Bank Co., Ltd. (*6) PCC-Woori LP Secondary Fund Other financial services 38.8 38.8 Korea 2022.12.31 Woori bank and Woori Asset Management Co., Ltd. (*6) Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1(*10) Collective investment business - 27.5 Korea - Woori Bank and Woori Private Equity Asset Management Co., Ltd. (*6) Woori-Q Corporate Restructuring Private Equity Fund Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd. and Woori Private Equity Asset Management Co., Ltd. (*6) Woori-Shinyoung Growth-Cap Private Equity Fund I Other financial services 35.6 38.1 Korea 2022.12.31 Other financial services 35.0 35.0 Korea 2022.12.31 (*1) Most of the significant business transactions of associates are with the Group as of December 31, 2022 and 2021. (*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) There is no investment balance as of December 31, 2022 and 2021. (*4) Woori G Oncorp Corporate support of Major Industry General Type Private Placement Investment Trust (Type 2) and other 13 joint ventures and associates can exercise significant influence but was classified as an item measured at fair value through profit or loss. (*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 the reporting period 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) Two or more subsidiaries may invest or operate to exert significant influence on the decision-making process for activities related to the investee. (*7) The Group can participate as a co-operator to exert significant influence. (*8) It was excluded due to liquidation. (*9) It was dissoluted and will be liquidated. (*10) It was excluded from associates during the period. (*11) It was excluded as Woori Bank sold its shares during the period. (*12) It was reclassified to associate from subsidiary resulted from the loss of control along with the changes in percentage of ownership. - 123 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) Changes in the carrying value of investments in associates accounted for using the equity method of accounting are as follows (Unit: Korean Won in millions): For the year ended December 31, 2022 W Service Networks Co., Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. Woori Growth Partnerships New Technology Private Equity Fund 2016KIF-IMM Woori Bank Technology Venture Fund K BANK Co., Ltd. Woori Bank-Company K Korea Movie Asset 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 LOTTE CARD Co.,Ltd. Together-Korea Government Private Pool Private Securities Investment Trust No. 3 Genesis Environmental Energy Company 1st Private Equity Fund Union Technology Finance Investment Association Dicustody Co., Ltd. Orient Shipyard Co., Ltd. BTS 2nd Private Equity Fund STASSETS FUND III Japanese Hotel Real Estate Private Equity Fund No.2 Woori Seoul Beltway Private Special Asset Fund No.1 Woori Multi-Return Securities Investment Trust 3 (Balanced Bond) Woori Short-term Bond Securities Investment Trust(Bond) ClassC-F Woori Safe Plus General Type Private Investment Trust S- 8(Bond) WOORI TAERIM 1st Fund Portone-Cape Fund No.1 KIWOOM WOORI Financial 1st Investment Fund DeepDive WOORI 2021-1 Financial Investment Fund Darwin Green Packaging Private Equity Fund DS Power Semicon Private Equity Fund Acquisition cost January 1, 2022 108 3,313 183 9,423 Share of profits(losses) and others Acquisition - - 29 (3,714) 3,267 3,101 (727) 12,942 12,448 490 7,594 12,630 236,232 239,493 (1,619) 11,854 - 345 71 5,039 6,576 (2,298) - - - - - - Disposal/ Reclassification Dividends (4) - - - - (2,049) - - Change in capital - - - December 31, 2022 208 5,709 2,374 - 10,889 (801) - (736) - - 9,474 (3,558) 247,789 - - (177) - - - 239 4,278 7,556 11,153 1,312 - (2,180) - - 10,285 4,355 4,254 346,810 458,295 1 58,400 100 - - - - (12,960) - 4,355 10,396 514,131 10,000 10,070 173 - 4,126 (41) - - 14,637 1 - 3,026 1,500 12,388 1 - - - 187 - - (145) (270) 2,250 - - 3,026 1,500 3,174 3,196 194 - 9,791 7,551 246 2,312 - - - 10,243 (3,738) (347) - - - - - - - 14,462 1 - 2,881 1,230 - - - - - (299) (236) 2,855 (235) - 9,874 (363) - - - - - - - 10,023 - - (9,950) (73) - - 110,000 151,822 2,312 50,000 (90,137) (1,972) - 112,025 10,000 1,100 340 - 991 489 1,000 973 900 993 4,000 3,957 230 (3) (25) (20) (12) 388 10,000 - - - - - 3,000 - 245 3,000 - - - - (48) - - - (100) (3) - - (400) (269) - - - - - - - 10,182 988 464 953 878 3,945 2,976 - 124 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 For the year ended December 31, 2022 Acquisition cost January 1, 2022 Share of profits(losses) and others Disposal/ Acquisition Reclassification Dividends Change in capital December 31, 2022 Koreawide partners 2nd Private Equity Fund Woori FirstValue Private Real 20,000 - - 20,000 Estate Fund No.2 9,000 763 (6) WooriG Real Infrastructure Blind General Type Private Placement Investment Trust Woori BIG2 Plus Securities Investment Trust(Balanced Bond) Woori Together TDF 2025 Woori Together TDF 2030 WOORI Star50 feeder fund(H) Woori Hanhwa Eureka Private Equity Fund Aarden Woori Apparel 1st Private Equity Fund Woori Dyno 1st Private Equity Fund Australia Green Energy 1st PEF Godo Kaisha Oceanos 1 Woori Zip 1 Woori Zip 2 Force TEC Co., Ltd. (*) KUM HWA Co., Ltd. (*) Jinmyung Plus Co., Ltd. JC Assurance No.2 Private Equity Fund Dream Company Growth no.1 PEF HMS-Oriens 1st Fund WooriG Senior Loan General Type Private Investment Trust No.1 Genesis Eco No.1 Private Equity Fund Paratus Woori Material Component Equipment joint venture company Midas No. 8 Private Equity Joint Venture Company Orchestra Private Equity Fund IV Synaptic Green No.1 PEF IGEN2022No. 1 Private Equity Fund PCC-Woori LP Secondary Fund Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 Woori-Q Corporate Restructuring Private Equity Fund Woori-Shinyoung Growth- Cap Private Equity Fund I 100 100 2 1,200 2,000 2,000 200 - - - - - 327 100 2,000 4,913 10,800 9,254 12,928 - - - 99 - - 9,905 10,496 14,732 - - - (161) (202) (214) (5) (48) (2) (55) 84 (138) (127) 56 - 10 29,349 17,728 (17,728) 7,412 12,000 7,914 12,007 418 1,245 - - - - - - - - 4,913 - - - - - - - - - (6) 2,000 - (199) - 1,235 2,192 2,247 131 - - - - - - - (164) (115) - - - - - - (873) (1,309) - - - - - - - (1,049) - - - - - - (471) - - 20,000 - 558 - 102 - - - - - - - - (152) (795) (1,116) (56) - - - - - 1,074 1,990 2,033 126 - 97 1,994 4,858 8,788 8,690 12,180 - - 10 - 7,861 13,252 80,268 88,029 3,788 14,073 (20,322) (3,707) - 81,861 12,000 11,120 (99) 195 17,700 17,493 (243) 18,735 18,968 275 - - - - - 9,878 8,000 7,822 - - - 197 (207) 10,000 8,000 (122) - 650 8,000 (475) (165) - - (530) (377) - - 11,216 - 17,250 - 18,713 - - - 9,698 7,793 8,010 10,440 12,350 674 3,440 (3,480) - - 12,984 - 73,787 - - (73,598) (189) - - 27,063 46,155 (288) 536 (18,867) - - 27,536 17,018 28,713 1,131,865 1,335,167 14,561 69,689 - 143,345 - (222,922) - (24,126) - 43,274 4,483 1,305,636 - 125 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (*) As a result of discontinuation of the equity method, related companies’ losses amount not recognized is 665 million Won for Force TEC Co., Ltd. 3,743 million Won for Orient Shipyard Co., Ltd. and 0.2 million Won for KUM HWA Co., Ltd. and cumulated amount is 1,462 million Won for Force TEC Co., Ltd. 3,743 million Won for Orient Shipyard Co., Ltd. and 2 million Won for KUM HWA Co., Ltd. For the year ended December 31, 2021 W Service Networks Co., Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. Woori Growth Partnerships New Technology Private Equity Fund 2016KIF-IMM Woori Bank Technology Venture Fund K BANK Co., Ltd. (*1) Smart Private Equity Fund No.2 Woori Bank-Company K Korea Movie Asset 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 LOTTE CARD Co.,Ltd. Together-Korea Government Private Pool Private Securities Investment Trust No. 3 Genesis Environmental Energy Company 1st Private Equity Fund Union Technology Finance Investment Association Dicustody Co., Ltd. Japanese Hotel Real Estate Private Equity Fund No.2 Woori G Clean Energy No.1 Woori Goseong Power EBL Private Special Asset Fund Woori Seoul Beltway Private Special Asset Fund No.1 Woori Corporate Private Securities Fund 1 (Bond) Woori G Star Private Placement Investment Trust No.33 [FI] Woori Multi-Return Securities Investment Trust 3 (Balanced Bond) Woori Short-term Bond Securities Investment Trust(Bond) ClassC-F WOORI TAERIM 1st Fund Portone-Cape Fund No.1 KIWOOM WOORI Financial 1st Investment Fund Acquisition cost January 1, 2021 108 3,313 191 8,125 Share of profits(losses) and others Acquisition - - (4) 1,388 3,267 3,066 35 14,991 15,032 (637) 8,396 13,238 236,232 174,097 3,520 67,553 - - 1,481 (797) 2,788 137 5,039 9,816 2,521 - - - - - - - Disposal/ Reclassification Dividends (4) - (90) - - (1,947) - - Change in capital - - - December 31, 2021 183 9,423 3,101 - 12,448 (3,497) - (631) - - 12,630 (2,157) 239,493 (684) - (2,100) (480) (4,961) (800) - - - - 345 6,576 9,736 9,756 1,417 5,040 (5,060) - - 11,153 4,255 4,129 346,810 422,832 - 39,301 125 - - - - (10,374) - 4,254 6,536 458,295 10,000 10,023 47 3,738 3,979 147 12,750 1 4,485 - 3,291 - 3,234 1,024 - 15,118 (347) - 237 - 227 - - 8,250 1 - 1,462 - - - - - - - - - 10,070 - - - 4,126 12,388 1 - (2,338) (201) (148) (74) - 3,196 - - (15,118) (370) 143 - 7,513 5,613 124 1,935 - (121) - - 10,000 - - - - 10,000 (10,000) - 20,000 (20,000) 23 10,000 - 150,000 1,100 340 - 283 960 1,822 708 189 150,000 - - 1,000 994 (21) - - - (660) - - - - - - - - - - - 7,551 - - - 10,023 - 151,822 991 - 489 - - 973 - 126 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 DeepDive WOORI 2021-1 Financial Investment Fund Darwin Green Packaging Private Equity Fund Woori FirstValue Private Real Estate Fund No.2 WooriG Real Infrastructure Blind General Type Private Placement Investment Trust Woori High plus G.B. Securities Feeder Fund1(G.B.) Woori Star50 Master Fund ClassC-F Woori Hanhwa Eureka Private Equity Fund Aarden Woori Apparel 1st Private Equity Fund Godo Kaisha Oceanos 1 Woori Zip 1 Woori Zip 2 Force TEC Co., Ltd. (*2) KUM HWA Co., Ltd. (*2) Jinmyung Plus Co., Ltd. JC Assurance No.2 Private Equity Fund Dream Company Growth no.1 PEF HMS-Oriens 1st Fund WooriG Senior Loan General Type Private Investment Trust No.1 Genesis Eco No.1 Private Equity Fund Paratus Woori Material Component Equipment joint venture company Midas No. 8 Private Equity Joint Venture Company PCC-Woori LP Secondary For the year ended December 31, 2021 Acquisition cost January 1, 2021 Share of profits(losses) and others Disposal/ Acquisition Reclassification Dividends Change in capital December 31, 2021 1,000 4,000 - - (7) 1,000 (43) 4,000 9,000 2,130 (637) - 100 - - - 6,076 184 164 403 100 10,800 10,143 14,254 - - - - 10,193 - - 393 - - - - (4) 138 (1) 127 (26) (50) (393) - - 100 - - - 100 - 16,380 22,883 - - - 29,349 29,050 (11,621) 299 7,706 12,000 7,705 12,000 680 7 - - - - - - (6,076) (180) (214) - - (6,237) (8,628) - - - - - - - - (730) - - - - - (370) - - - - - - - - 993 3,957 763 - 100 - - - - (45) 379 527 - - - - - 327 99 9,905 10,496 14,732 - - - - - 17,728 (471) - - - 7,914 12,007 87,382 52,045 2,959 38,757 (3,060) (2,672) - 88,029 11,805 17,700 19,000 - - - (685) 11,805 (207) 17,700 (32) 19,000 - - - - - - - - - 11,120 - 17,493 - 18,968 - 12,350 Fund 10,100 8,128 1,697 2,525 Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 Woori-Q Corporate Restructuring Private Equity Fund Woori-Shinyoung Growth- Cap Private Equity Fund I 70,988 93,474 921 20,765 (38,870) (2,503) - 73,787 45,394 22,904 1,002 25,246 (2,997) - - 46,155 17,218 38,342 1,210,083 993,291 20,813 132,228 12,799 400,172 (32,415) (165,042) (10,826) (30,791) - 28,713 5,309 1,335,167 (*1) Included 70,120 million won of deemed gain on disposal in accordance with the decrease in percentage of ownership from disproportionate contribution for the year ended December 31, 2021. (*2) As a result of discontinuation of the equity method, related companies’ losses amount not recognized is 797 million Won for Force TEC Co., Ltd. and 2 million won for KUM HWA Co., Ltd. - 127 - Total comprehensive income(loss) 1,215 13,809 (3,856) 2,185 (7,839) 58,903 324 (9,831) 7,288 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) Summary financial information relating to investments in associates accounted for using the equity method of accounting is as follows (Unit: Korean Won in millions): Assets Liabilities December 31, 2022 Operating revenue Net income (loss) Other comprehensive income(loss) W Service Networks Co., Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. Woori Growth Partnerships New Technology 7,052 155,165 28,792 2,825 100,065 12,964 19,697 144,907 47,043 1,215 13,809 (3,856) Private Equity Fund 47,394 208 2,978 2,185 - - - - 2016KIF-IMM Woori Bank Technology Venture Fund K BANK Co., Ltd. Woori Bank-Company K Korea Movie Asset Fund (*1) 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 LOTTE CARD Co., Ltd. (*2) Together-Korea Government Private Pool 47,979 609 16,694,289 14,896,426 665 491,880 (7,839) 91,059 - (32,156) 989 18,395 33 - 462 (9,431) 324 (9,831) 51,804 385 8,092 7,288 - - - 15,811 1 19,983,059 17,179,093 1,925,577 95 (383) 268,096 - 43,162 (383) 311,258 Private Securities Investment Trust No. 3 10,246 1 218 170 Union Technology Finance Investment Association Dicustody Co., Ltd. Orient Shipyard Co., Ltd. BTS 2nd Private Equity Fund STASSETS FUND III Japanese Hotel Real Estate Private Equity Fund 2 Woori Seoul Beltway Private Special Asset Fund No.1 Woori Short-term Bond Securities Investment 48,991 95 10,832 15,012 4,660 299 - 27,225 608 313 2,300 - - 1 37 632 (3) (16,467) (725) (953) 14,387 13 1,050 39,497 2 1,028 968 984 Trust(Bond) ClassC-F 468,357 67,022 14,189 11,804 Woori Safe Plus General Type Private Investment Trust S-8(Bond) WOORI TAERIM 1st Fund Portone-Cape Fund No.1 KIWOOM WOORI Financial 1st Investment 115,781 4,047 2,344 4,508 185 26 1,899 - - 1,763 (13) (129) Fund 10,597 111 1 (222) DeepDive WOORI 2021-1 Financial Investment Fund Darwin Green Packaging Private Equity Fund DS Power Semicon Private Equity Fund Koreawide partners 2nd Private Equity Fund Woori FirstValue Private Real Estate Fund No.2 WooriG Real Infrastructure Blind General 7,412 19,332 14,230 77,039 37 - 44 2,038 57 2,215 1,185 3,020 (103) 1,904 937 1 67,005 62,357 3 (54) Type Private Placement Investment Trust 73,064 56 3,140 2,874 Woori BIG2 Plus Securities Investment Trust(Balanced Bond) Woori Together TDF 2025 Woori Together TDF 2030 WOORI Star50 feeder fund(H) Aarden Woori Apparel 1st Private Equity Fund Woori Dyno 1st Private Equity Fund Australia Green Energy 1st PEF Godo Kaisha Oceanos 1 Woori Zip 1 Woori Zip 2 4,667 8,513 8,615 709 20,750 10,212 122,634 63,741 48,309 68,388 12 16 - - 89 43 14 45,358 34,346 48,927 - 128 - 389 1,287 1,352 48 8 200 30 2,942 2,085 3,069 (636) (1,018) (1,108) (480) (325) (31) (1,380) 176 (215) (198) - - - - - - (1,186) - - - - - - - - - - - - - - - - - - - - - - 170 632 (3) (16,467) (725) (953) (218) 984 11,804 1,763 (13) (129) (222) (103) 1,904 937 1 (54) 2,874 (636) (1,018) (1,108) (480) (325) (31) (1,380) 176 (215) (198) WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Assets Liabilities Force TEC Co., Ltd. KUM HWA Co., Ltd. Jinmyung Plus Co.,Ltd. JC Assurance No.2 Private Equity Fund Dream Company Growth no.1 PEF HMS-Oriens 1st Fund Woori G Senior Loan Private Placement Investment Trust No.1 Genesis Eco No.1 Private Equity Fund Paratus Woori Material Component Equipment joint venture company Midas No. 8 Private Equity Joint Venture Company Orchestra Private Equity Fund IV Synaptic Green No.1 PEF IGEN2022No. 1 Private Equity Fund PCC-Woori LP Secondary Fund Woori-Q Corporate Restructuring Private Equity Fund Woori-Shinyoung Growth-Cap Private Equity 10,489 4 696 122,015 28,351 58,095 378,145 38,700 58,311 65,936 34,427 37,017 32,362 33,591 December 31, 2022 Operating revenue 25,182 - 177 - 1,695 3,829 Net income (loss) (2,664) (8) (9) (929) 1,506 3,279 24,804 159 649 3 50 6 23 5 18,584 48 17,496 (593) 617 242 - - 122 168 7 (812) 1,928 1,580 4 3,166 6,127 977 878 (983) 2,616 1,152 Other comprehensive income(loss) - - - - - - - - - - - - - - - - Total comprehensive income(loss) (2,664) (8) (9) (929) 1,506 3,279 17,496 (593) (812) 977 878 (983) 2,616 1,152 (4,696) 40,544 Fund I 123,824 312 41,780 40,544 75,973 418 3,019 (4,696) (*1) It was dissoluted for the year ended December 31,2021 and will be liquidated. (*2) 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. - 129 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Assets Liabilities December 31, 2021 Operating revenue Net income (loss) Other comprehensive income(loss) W Service Networks Co., Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. Woori Growth Partnerships New Technology 6,208 113,859 34,957 2,504 21,284 14,286 17,019 127,751 57,462 840 20,486 249 Private Equity Fund 54,173 231 3,807 (2,228) - - - - 63,983 837 14,021,789 12,291,131 23,010 250,502 21,119 19,348 - (32,072) 1,383 28,273 2 - 1,075 11,972 543 10,914 56,363 597 11,422 10,077 - - - 15,799 - 15,980,312 13,460,156 1,499,867 5 (332) 184,919 - 25,612 (332) 210,531 10,073 1 41 37 20,610 3,941 11,347 694 41,996 98 290 - 13 - (1,168) (2) - - - - Fund 2 16,104 14 911 1,196 (373) 2016KIF-IMM Woori Bank Technology Venture Fund K BANK Co., Ltd. Woori Bank-Company K Korea Movie Asset 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 LOTTE CARD Co.,Ltd (*) Together-Korea Government Private Pool Private Securities Investment Trust No. 3 Genesis Environmental Energy Company 1st Private Equity Fund Union Technology Finance Investment Association Dicustody Co., Ltd. Japanese Hotel Real Estate Private Equity Woori Seoul Beltway Private Special Asset Fund No.1 Woori Multi-Return Securities Investment Trust 3 (Balanced Bond) Woori Short-term Bond Securities Investment Trust(Bond) ClassC-F WOORI TAERIM 1st Fund Portone-Cape Fund No.1 KIWOOM WOORI Financial 1st Investment Fund DeepDive WOORI 2021-1 Financial Investment Fund Darwin Green Packaging Private Equity Fund Woori FirstValue Private Real Estate Fund No.2 WooriG Real Infrastructure Blind General Type Private Placement Investment Trust Woori Hanhwa Eureka Private Equity Fund Aarden Woori Apparel 1st Private Equity Fund Godo Kaisha Oceanos 1 Woori Zip 1 Woori Zip 2 Force TEC Co., Ltd. KUM HWA Co., Ltd. Jinmyung Plus Co.,Ltd. JC Assurance No.2 Private Equity Fund Dream Company Growth no.1 PEF HMS-Oriens 1st Fund Woori G Senior Loan Private Placement Investment Trust No.1 Genesis Eco No.1 Private Equity Fund Paratus Woori Material Component Equipment joint venture company Midas No. 8 Private Equity Joint Venture Company 30,206 1 536 500 101,644 51,530 5 2 1,209,228 4,047 2,447 158,524 172 - 89 - 1,050 10,818 111 8,340 19,387 - - 69,672 63,309 1 - - - 79 2,770 947 (221) (60) (213) (5,303) 35,796 40,817 21,075 66,087 52,259 74,033 11,904 20 568 118,397 28,533 52,659 406,634 38,369 58,507 1 133 (34) 20,193 (35) 19,821 89 45,367 35,833 50,951 23,508 176 445 - 44 28 25 4 - - 3,141 1,106 1,536 20,941 58 209 - - 2,750 (214) 267 (26) (50) (9,188) (10) 5 (1,040) 1,500 2,179 14,553 308 13,669 (377) 7 1 (693) (113) 66,699 112 - 130 - Total comprehensive income(loss) 840 20,486 249 (2,228) 21,119 (12,724) 543 10,914 10,077 37 694 (1,168) (2) 823 500 2 79 2,770 947 (221) (60) (213) (5,303) (35) 19,821 (214) 267 (26) (50) (9,188) (10) 5 (1,040) 1,500 2,179 13,669 (377) (693) (113) - - - - - - - - - - - - - - - - - - - - - - - - - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Assets Liabilities December 31, 2021 Operating revenue Net income (loss) Other comprehensive income(loss) PCC-Woori LP Secondary Fund Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 Woori-Q Corporate Restructuring Private Equity Fund Woori-Shinyoung Growth-Cap Private Equity 31,585 257,891 - - 5,720 4,162 3,239 3,239 121,057 555 327 (1,547) Fund I 82,087 314 83,143 81,550 - - - - (*) 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. Total comprehensive income(loss) 4,162 3,239 (1,547) 81,550 - 131 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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, 2022 and 2021 are as follows: CL Tech Co., Ltd. Associate (*) December 31, 2022 Number of shares owned 10,191 Ownership (%) 28.6 (*) Although 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, accordingly it is excluded from the investment in joint ventures and associates. Associate (*) Orient Shipyard Co., Ltd. Yuil PESC Co., Ltd. CL Tech Co., Ltd. S.WIN Co., Ltd. December 31, 2021 Number of shares owned 464,812 8,642 13,759 20,301 Ownership (%) 21.4 24.0 38.6 20.0 (*) Although 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, accordingly it is excluded from the investment in joint ventures and associates. - 132 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (5) As of December 31, 2022 and 2021, the reconciliations from the net assets of the associates to the carrying amount of the shares of the investment in joint ventures and associates are as follows (Unit: Korean Won in millions except for ownership): December 31, 2022 Basis difference Impairment - - - 246 Intercompany transaction (1) 1 Book value 208 5,709 47,370 1,796,269 20.0 12.6 9,474 225,894 - 21,894 Korea Movie Asset Fund 957 25.0 239 W Service Networks Co., Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. Woori Growth Partnerships New Technology Private Equity Fund 2016KIF-IMM Woori Bank Technology Venture Fund K BANK Co., Ltd. (*) Woori Bank-Company K 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 LOTTE CARD Co., Ltd. (*) Together-Korea Government Private Pool Private Securities Investment Trust No.3 Union Technology Finance Investment Association Dicustody Co., Ltd. Orient Shipyard Co., Ltd. BTS 2nd Private Equity Fund STASSETS FUND III Japanese Hotel Real Estate Private Equity Fund No.2 Woori Seoul Beltway Private Special Asset Fund No.1 Woori Short-term Bond Securities Investment Trust (Bond) ClassC-F Woori Safe Plus General Type Private Investment Trust S- 8(Bond) WOORI TAERIM 1st Fund Portone-Cape Fund No.1 KIWOOM WOORI Financial 1st Investment Fund DeepDive WOORI 2021-1 Total net asset Ownership (%) Ownership portion of net assets 4,227 55,100 4.9 9.9 209 5,462 15,828 15.0 2,374 47,185 23.1 10,889 18,395 23.3 4,278 51,419 20.0 10,284 15,716 2,570,656 25.0 20.0 3,929 514,131 10,245 100.0 10,244 48,692 95 (16,393) 14,405 4,347 29.7 1.0 22.7 20.0 28.3 14,463 1 (3,721) 2,881 1,230 14,374 19.9 2,855 39,495 25.0 9,874 401,335 27.9 112,025 111,273 3,862 2,318 9.2 25.6 20.0 10,182 988 464 10,486 9.1 953 878 Financial Investment Fund 7,375 11.9 Darwin Green Packaging Private Equity Fund DS Power Semicon Private Equity Fund Koreawide partners 2nd Private 19,332 20.4 3,945 14,186 21.0 2,976 Equity Fund 75,001 26.7 20,000 Woori FirstValue Private Real Estate Fund No.2 4,648 12.0 558 - 133 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 2,374 - 10,889 - 9,474 1 247,789 - - 239 4,278 1 10,285 426 4,355 - 514,131 (1) 10,243 (1) - 3,721 - - - - 14,462 1 - 2,881 1,230 2,855 9,874 - 112,025 - - - - - - - 10,182 988 464 953 878 3,945 2,976 - 20,000 - 558 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Total net asset Ownership (%) Ownership portion of net assets Basis difference Impairment Intercompany transaction Book value December 31, 2022 Woori G Real Infrastructure Blind General Type Private Placement Investment Trust Woori BIG2 Plus Securities Investment Trust(Balanced Bond) Woori Together TDF 2025 Woori Together TDF 2030 WOORI Star50 feeder fund(H) Aarden Woori Apparel 1st Private Equity Fund Woori Dyno 1st Private Equity Fund Australia Green Energy 1st 73,008 0.1 102 4,655 8,497 8,615 709 23.1 23.6 23.8 17.9 1,074 1,990 2,033 126 20,661 0.5 97 10,169 19.6 1,994 PEF Godo Kaisha Oceanos 1 Woori Zip 1 Woori Zip 2 Force TEC KUM HWA Co., Ltd. Jinmyung Plus Co.,Ltd. JC Assurance No.2 Private 122,620 18,383 13,963 19,461 (14,315) (155) 47 4.0 47.8 64.0 64.0 24.5 20.1 21.3 4,858 8,788 8,690 12,180 (3,513) (31) 10 - - - - - - - - - - - - - - - - - - - - - - - - - - - - Equity Fund 122,012 23.5 17,728 - (17,728) Dream Company Growth no.1 PEF HMS-Oriens 1st Fund Woori G Senior Loan General Type Private Investment Trust No.1 Genesis Eco No.1 Private Equity Fund Paratus Woori Material Component Equipment joint venture company Midas No. 8 Private Equity Joint Venture Company Orchestra Private Equity Fund IV Synaptic Green No.1 PEF IGEN2022No. 1 Private Equity 28,301 58,089 27.8 22.8 7,861 13,252 378,122 21.7 81,861 38,695 29.0 11,216 57,694 29.9 17,250 65,694 28.5 18,713 34,427 37,017 28.2 21.1 9,698 7,793 Fund 32,240 24.8 8,010 PCC-Woori LP Secondary Fund Woori-Q Corporate Restructuring Private Equity Fund Woori-Shinyoung Growth-Cap 33,423 38.8 12,984 75,555 35.6 27,536 Private Equity Fund I 123,512 35.0 43,274 - - - - - - - - - - - - - - - - - - - - - - - - (*) The net asset equity amount is after the debt-for-equity swap, non-controlling etc. - 102 - - - - - - - - - - 3,513 31 - - - - 1,074 1,990 2,033 126 97 1,994 4,858 8,788 8,690 12,180 - - 10 - 7,861 13,252 - 81,861 - 11,216 - 17,250 - 18,713 - - - 9,698 7,793 8,010 - 12,984 - 27,536 - 43,274 - 134 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Total net asset Ownership (%) Ownership portion of net assets Basis difference Impairment Intercompany transaction Book value December 31, 2021 W Service Networks Co., Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. Woori Growth Partnerships New Technology Private Equity Fund 2016KIF-IMM Woori Bank Technology Venture Fund K BANK Co., Ltd. (*) Woori Bank-Company K Korea Movie Asset 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 LOTTE CARD Co., Ltd (*1) Together-Korea Government Private Pool Private Securities Investment Trust No.3 Genesis Environmental Energy Company 1st Private Equity Fund Union Technology Finance Investment Association Dicustody Co., Ltd. Japanese Hotel Real Estate Private Equity Fund No.2 Woori Seoul Beltway Private Special Asset Fund No.1 Woori Multi Return Private Securities Investment Trust 3(Balanced Bond) Woori Short-term Bond Securities Investment Trust (Bond) ClassC-F WOORI TAERIM 1st Fund Portone-Cape Fund No.1 KIWOOM WOORI Financial 1st Investment Fund 3,704 92,575 4.9 9.9 183 - 9,177 246 20,671 15.0 3,101 53,942 23.1 12,448 - - 63,146 1,730,307 20.0 12.6 12,630 217,599 - 21,894 1,381 25.0 345 28,273 23.3 6,576 - - 55,767 20.0 11,153 - 15,794 25.0 3,949 2,291,474 20.0 458,295 10,071 100.0 10,070 16,669 24.8 4,126 41,706 98 29.7 1.0 12,388 1 16,090 19.9 3,196 30,205 25.0 7,551 50,114 20.0 10,023 1,050,704 14.5 151,822 3,875 2,447 25.6 20.0 991 489 10,707 9.1 973 - 135 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 183 9,423 3,101 - 12,448 - 12,630 - 239,493 - 345 - 6,576 - 11,153 305 4,254 - 458,295 - 10,070 - - - 4,126 12,388 1 - 3,196 - 7,551 - 10,023 - 151,822 - - 991 489 - 973 WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 DeepDive WOORI 2021-1 Financial Investment Fund Darwin Green Packaging Private Equity Fund Woori FirstValue Private Real Estate Fund No.2 WooriG Real Infrastructure Blind General Type Private Placement Investment Trust Woori Hanhwa Eureka Private Equity Fund Aarden Woori Apparel 1st Private Equity Fund Godo Kaisha Oceanos 1 Woori Zip 1 Woori Zip 2 Force TEC KUM HWA Co., Ltd. Jinmyung Plus Co.,Ltd. JC Assurance No.2 Private Equity Fund Dream Company Growth no.1 PEF HMS-Oriens 1st Fund WooriG Senior Loan General Type Private Investment Trust No.1 Genesis Eco No.1 Private Equity Fund Paratus Woori Material Component Equipment joint venture company Midas No. 8 Private Equity Joint Venture Company PCC-Woori LP Secondary Total net asset Ownership (%) Ownership portion of net assets Basis difference Impairment Intercompany transaction Book value December 31, 2021 8,340 11.9 993 19,387 20.4 3,957 6,363 12.0 763 35,795 40,684 20,986 20,720 16,426 23,082 (11,604) (156) 123 0.3 0.8 0.5 47.8 63.9 63.8 24.5 20.1 21.3 100 327 99 9,905 10,496 14,732 (2,843) (31) 25 - - - - - - - - - - - - - - - - - - - - - - - - - 993 - - 3,957 763 - - - - - - 2,843 31 (25) 100 327 99 9,905 10,496 14,732 - - - 118,397 24.4 29,349 - (11,621) - 17,728 - - - - - - - - - - - - - - - - - - - - - - 7,914 12,007 - 88,029 - 11,120 - 17,493 - 18,968 - 12,350 - 73,787 - 46,155 - 28,713 28,489 52,631 27.8 22.8 7,914 12,007 406,609 21.7 88,029 38,365 29.0 11,120 58,507 29.9 17,493 66,587 28.5 18,968 Fund 31,585 38.8 12,350 Woori High Plus Short- term High Graded ESG Bond Sec Feeder Inv Trust 1 Woori-Q Corporate Restructuring Private Equity Fund Woori-Shinyoung Growth- Cap Private Equity Fund I 257,891 27.5 73,787 120,502 38.1 46,155 81,773 35.0 28,713 (*) The net asset equity amount is after the debt-for-equity swap, non-controlling etc. - 136 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 14. INVESTMENT PROPERTIES (1) Details of investment properties are as follows (Unit: Korean Won in millions): Acquisition cost Accumulated depreciation Accumulated impairment losses Net carrying value December 31, 2022 December 31, 2021 418,775 (30,982) (86) 387,707 415,163 (25,582) (86) 389,495 (2) Changes in investment properties are as follows (Unit: Korean Won in millions): Beginning balance Disposal Depreciation Transfer Foreign currencies translation adjustments Ending balance For the years ended December 31 2022 2021 389,495 (1,206) (3,925) 7,153 (3,810) 387,707 387,464 - (2,809) 6,095 (1,255) 389,495 (3) Fair value of investment properties amounted to 647,072 million won and 665,710 million won as of December 31, 2022 and 2021, 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 22,798 million won and 15,056 million won for the years ended December 31, 2022 and 2021, respectively. Operating expenses directly related to the investment properties where rental fee was earned is amounting to 4,093 million won and 2,941 million won. (5) The lease payments expected to be received in the future under lease contracts relating to investment properties as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): December 31, 2022 December 31, 2021 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 12,368 8,481 5,320 3,201 2,634 2,568 34,572 13,769 10,770 7,743 5,009 2,953 2,603 42,847 - 137 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 15. PREMISES AND EQUIPMENT (1) Details of premises and equipment as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Premises and equipment (owned) Right-of-use asset Carrying value Premises and equipment (owned) Right-of-use asset Carrying value Land Building Equipment and vehicles December 31, 2022 Leasehold improvement Construction in progress Structures Total 1,695,357 - 1,695,357 730,676 349,494 1,080,170 261,278 15,589 276,867 58,352 32,184 - - 58,352 32,184 - - - 2,777,847 365,083 3,142,930 Land Building Equipment and vehicles December 31, 2021 Leasehold improvement Construction in progress Structures Total 1,719,325 - 1,719,325 756,964 367,480 1,124,444 258,361 18,064 276,425 51,354 3,171 - - 51,354 3,171 1 - 1 2,789,176 385,544 3,174,720 (2) Details of premises and equipment (owned) as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Acquisition cost Accumulated depreciation Accumulated impairment losses Net carrying value Acquisition cost Accumulated depreciation Accumulated impairment losses Net carrying value Land Building 1,696,017 1,078,385 - (347,709) Equipment and vehicles 1,179,928 (918,650) December 31, 2022 Leasehold improvement 470,513 (412,161) Construction in progress Structures 20 (20) 32,184 - Total 4,457,047 (1,678,540) (660) 1,695,357 - 730,676 - - 261,278 58,352 - 32,184 - - (660) 2,777,847 Land Building 1,719,985 1,076,091 - (319,127) Equipment and vehicles 1,156,479 (898,118) December 31, 2021 Leasehold improvement 475,195 (423,841) Construction in progress Structures 20 (19) 3,171 - Total 4,430,941 (1,641,105) (660) 1,719,325 - 756,964 - 258,361 - 51,354 - 3,171 - 1 (660) 2,789,176 - 138 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) Details of changes in premises and equipment (owned) are as follows (Unit: Korean Won in millions): For the year ended December 31, 2022 Equipment and vehicles Construction in progress Structures Total 3,171 31,810 - - - - 225 - (3,022) 32,184 1 2,789,176 - 173,156 - (22,471) (1) (151,076) - - (13,109) (7,153) - (117) - 12,026 - (2,585) - 2,777,847 Beginning balance Acquisitions Disposals Depreciation Classification of assets held for sale Transfer Foreign currencies Land 1,719,325 24 (20,024) - Building 756,964 14,524 (788) (32,290) (6,405) (3,040) (6,704) (4,113) translation adjustments Business combination Others Ending balance (855) 5,917 415 1,695,357 (428) 3,523 (12) 730,676 Beginning balance Acquisitions Disposals Depreciation Classification of assets held for sale Transfer Foreign currencies Land 1,726,045 - - - Building 787,040 15,750 (1,994) (33,523) (7,157) (3,649) (5,695) (2,446) translation adjustments Others Ending balance 991 3,095 1,719,325 712 (2,880) 756,964 Leasehold improvement 51,354 28,178 (656) (21,185) - - 549 - 112 58,352 Leasehold improvement 50,085 23,347 (979) (22,293) 258,361 98,620 (1,003) (97,600) - - 392 2,586 (78) 261,278 268,225 68,069 (1,663) (93,921) - 15,399 2,868 (616) 258,361 For the year ended December 31, 2021 Equipment and vehicles Construction in progress Structures Total 8,246 11,637 - - 2 2,839,643 118,803 - (4,636) - (1) (149,738) - - - (15,399) - - (12,852) (6,095) 1,580 (386) 51,354 153 (1,466) 3,171 6,304 - - (2,253) 1 2,789,176 (4) Details of right-of-use assets as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Acquisition cost Accumulated depreciation Net carrying value Acquisition cost Accumulated depreciation Net carrying value Building December 31, 2022 Equipment and vehicles 643,484 (293,990) 349,494 650,906 (283,426) 367,480 Building 32,700 (17,111) 15,589 December 31, 2021 Equipment and vehicles 30,559 (12,495) 18,064 Total Total 676,184 (311,101) 365,083 681,465 (295,921) 385,544 - 139 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (5) Details of changes in right-of-use assets for the years ended December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Beginning balance New contracts Changes in contract Termination Depreciation Business combination Others Ending balance Beginning balance New contracts Changes in contract Termination Depreciation Business combination Others Ending balance Building For the year ended December 31, 2022 Equipment and vehicles Total 367,480 225,396 3,514 (43,597) (211,175) 819 7,057 349,494 18,064 9,819 (26) (870) (11,406) - 8 15,589 Building For the year ended December 31, 2021 Equipment and vehicles Total 435,132 172,812 9,064 (46,563) (228,403) - 25,438 367,480 12,423 16,848 225 (1,742) (10,665) - 975 18,064 385,544 235,215 3,488 (44,467) (222,581) 819 7,065 365,083 447,555 189,660 9,289 (48,305) (239,068) - 26,413 385,544 16. INTANGIBLE ASSETS (1) Details of intangible assets are as follows (Unit: Korean Won in millions): Goodwill Industrial property rights Development cost Other intangible assets Membership deposit Construction in progress December 31, 2022 Acquisition cost Accumulated amortization Accumulated impairment losses Net carrying value 397,527 - - 397,527 2,219 (1,576) 754,031 1,244,516 (541,404) (1,018,591) - 643 - 212,627 (33,552) 192,373 46,231 - (3,314) 42,917 3,027 - - 3,027 Goodwill Industrial property rights Development cost Other intangible assets Membership deposit Construction in progress December 31, 2021 Acquisition cost Accumulated amortization Accumulated impairment losses Net carrying value 345,449 - - 345,449 2,057 (1,334) 661,959 1,174,565 (947,830) (454,251) - 723 - 207,708 (33,553) 193,182 40,955 - (3,348) 37,607 717 - - 717 Total 2,447,551 (1,561,571) (36,866) 849,114 Total 2,225,702 (1,403,415) (36,901) 785,386 - 140 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) Details of changes in intangible assets are as follows (Unit: Korean Won in millions): Goodwill Industrial property rights Beginning balance Acquisitions Disposal Amortization (*) Impairment losses Transfer Business combination Foreign currencies translation adjustments Others Ending balance 345,449 - - - - - 57,670 (5,592) - 397,527 For the year ended December 31, 2022 Development cost 207,708 91,992 - (87,294) - 300 - Other intangible assets 193,182 62,073 (2) (75,299) - 182 7,795 Membership deposit Construction in progress 37,607 6,571 (1,295) - 88 - - 717 2,421 - - - (482) - Total 785,386 163,219 (1,297) (162,835) 88 - 65,465 723 162 - (242) - - - - - 643 (5) (74) 212,627 (865) 5,307 192,373 (42) (12) 42,917 (53) 424 3,027 (6,557) 5,645 849,114 (*) Amortization of other intangible assets amounting to 14,664 million won is included in other operating expenses. Goodwill Industrial property rights Beginning balance Acquisitions Disposal Amortization (*) Impairment losses Transfer Foreign currencies translation adjustments Others Ending balance 334,290 - - - - - 11,159 - 345,449 For the year ended December 31, 2021 Development cost 208,873 74,444 - (80,128) - 4,518 Other intangible assets 205,445 49,137 - (68,950) (18) 2,946 Membership deposit Construction in progress 36,091 2,437 (347) - (93) - 6,669 977 - - - (7,464) Total 792,077 127,242 (347) (149,311) (111) - 709 247 - (233) - - - - 723 - 1 207,708 2,952 1,670 193,182 232 (713) 37,607 - 535 717 14,343 1,493 785,386 (*) Amortization of other intangible assets amounting to 13,963 million won is included in other operating expenses. (3) Goodwill 1) Details of allocated goodwill based on each cash-generating unit as of December 31, 2022 and 2021 are as follows (Unit: Korean won in million): Cash-generating unit (*1) December 31, 2022 December 31, 2021 Woori Asset Management Corp. Woori Global Asset Management Co., Ltd. Woori Asset Trust Co., Ltd. PT Bank Woori Saudara Indonesia 1906 Tbk (*2) WOORI BANK (CAMBODIA) PLC (*3) PT Woori Finance Indonesia Tbk. Others Total 43,036 2,030 141,780 97,029 55,570 51,382 6,700 397,527 43,036 2,030 141,780 99,667 52,082 - 6,854 345,449 (*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 segment 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 the 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. - 141 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 applied 0.0% - 1.0% growth rate to estimate future cash flow for the period over five years. 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 PT Bank Woori Saudara Indonesia 1906 Tbk 13.36 1.0 162,772 134,073 13.47 1.0 42,083 29,917 15.98 0.00 784,787 739,878 WB Finance Co., Ltd 16.88 0.00 544,693 499,823 Woori Asset Trust Co., Ltd. 14.55 1.0 431,777 300,023 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. 3) Sensitivity analysis The sensitivity of the fair value measurement to changes in significant but unobservable inputs used in measuring fair value is as follows (Unit: Korean Won in millions): Woori Asset Trust Co., Ltd. Woori Asset Management Corp. Woori Global Asset Management Co., Ltd. PT Bank Woori Saudara Indonesia 1906 Tbk WB Finance Co., Ltd. (39,501) (8,680) (2,553) (61,030) (38,845) 48,345 10,686 3,169 71,658 45,066 30,344 6,699 2,034 43,855 26,515 Category Discount rate (%). Terminal growth rate (%) Increase by 1.0% point Decrease by 1.0% point Increase by 1.0% point Decrease by 1.0% point(*) (25,010) (5,464) (1,650) - - (*) In the case of PT Bank Woori Saudara Indonesia 1906 Tbk and WOORI BANK (CAMBODIA) PLC, declining cases are excluded from the analysis as the permanent growth rate was assumed to be 0%. - 142 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 17. ASSETS HELD FOR SALE Assets held for distribution (sale) are as follows (Unit: Korean Won in millions): Assets (*) Premises and equipment Investments of associates Others Total December 31, 2022 9,589 - 4,183 13,772 December 31, 2021 8,900 11,472 5,955 26,327 (*) The Group classifies assets as held for sale that are highly likely to be sold within one year from December 31, 2022 and December 31, 2021. The Group measured assets held for sale at the lower of their net fair value or carrying amount. The Group has decided to sell some of the premises and equipment through internal consultation during the current year and classifies the premises as non-current assets held for sale. The asset is expected to be sold within 12 months, and the premises and equipment that was scheduled to be sold at the end of the prior year has been sold and removed. On the other hand, other assets that are expected to be sold as of the end of the current year are classified as assets that are expected to be sold within one year due to the possibility of being sold as buildings and land acquired through auction. - 143 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 FVTPL government bonds, etc. FINANCE CORPORATION, etc. Collateral given to KOREA SECURITIES December 31, 2022 Amount Reason for collateral Related to bonds sold under Korean treasury and government bonds, etc. Korean treasury and Korea Securities Depository SHINHAN government bonds, etc. Korean financial institutions’ SECURITIES CO, etc. SC FIRST BANK debt securities, etc. KOREA, SEOUL, etc. Korean financial institutions’ SHINHAN ASSET debt securities, etc. MANAGEMENT, etc. Korean capital contributions, Korea Software Financial etc. Korean treasury and government bonds Cooperative Korea Securities Depository 198,377 659,050 repurchase agreements (*1) Securities borrowing collateral 6,939 Future trading collateral 245,876 Variable margin deposit for CSA, etc. Related to bonds sold under 16,200 repurchase agreements (*1) 104 Bid guarantee, etc. Related to bonds sold under 460 repurchase agreements (*1) Korean financial institutions’ debt securities, etc. Debt securities in foreign currencies Debt securities in foreign currencies Korean treasury and government bonds Korean treasury and government bonds Debt securities in foreign currencies Debt securities in foreign currencies The BOK, etc. 6,394,890 Settlement risk, etc. BNP-PARIBAS, etc. 1,060,120 SC BANK, H.K, etc. 582,738 Korea Securities Depository 1,100,351 Variable margin deposit for CSA, etc. Related to bonds sold under repurchase agreements (*1) Related to bonds sold under repurchase agreements (*1) The BOK, etc. 10,820,136 Settlement risk, etc. NATIXIS, etc. 70,949 FHLB ADVANCE, etc. 10,570 Related to bonds sold under repurchase agreements (*1) Related to the borrowing limit Financial assets at FVTOCI Securities at amortized cost Loan at amortized cost and other financial assets Due from banks in local Daishin AMC Co.,Ltd. currency and others Other due from banks in local The Korea Exchange, currency Other due from banks in foreign currency Mortgage loan etc. Korea Investment & Securities, etc. Public offering Premises and equipment Investment properties Land and building Gakorea Co., Ltd , etc. Land and building Gakorea Co., Ltd., etc. 1,500 Right of pledge 133,539 Margin deposit for CCP 1,142,784 Overseas futures option deposit, etc. 1,892,723 Related to covered bonds 1,851 5,365 Right to collateral and others (*2) Right to collateral and others (*2) Total 24,344,522 (*1) 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). The asset is equivalent to a mortgage-backed debt security. (*2) The maximum pledge amount is 522 million Won. - 144 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Financial assets at FVTPL Korean treasury and Collateral given to Nonghyup bank and government bonds, etc others Korea Securities Depository Korean treasury and government bonds, etc Korean treasury and government bonds, etc Korean financial institutions’ debt securities, etc Korean financial institutions’ debt securities, etc Korean financial institutions’ debt securities, etc Corp. December 31, 2021 Amount 248,009 179,079 Reason for collateral Related to bonds sold under repurchase agreements (*) Securities borrowing collateral VI Investment, etc. 3,008 Future trading collateral Korea Securities Depository KOREA SECURITIES FINANCE CORPORATION Shinhan Investment Korea Securities Depository Korea Software Financial Cooperative Korea Securities Depository 205,783 Securities borrowing collateral 54,419 Collateral for securities lending purposes 5,352 299,161 Collateral for futures transaction Securities borrowing collateral 101 Bid guarantee, etc. 470 Related to bonds sold under repurchase agreements (*) The BOK and others 3,666,849 Settlement risk and others Foreign financial institutions’ STANDARD BANKLONDON LTD 126,595 Related to bonds sold under repurchase agreements (*) The BOK and others 8,977,748 Settlement risk and others NATIXIS and others 38,995 Foreign financial institutions’ FHLB ADVANCE and debt securities others 10,375 Related to bonds sold under repurchase agreements (*) Related to the borrowing limit Korean corporate bonds Korean capital contributions Financial assets at FVTOCI Korean treasury and government bonds Korean financial institutions’ debt securities, etc Securities at amortized cost debt securities Korean treasury and government bonds Foreign financial institutions’ debt securities Loan at amortized cost and other financial assets Due from banks in local Daishin AMC Co.,Ltd. currency and others Other due from banks in local Samsung Securities Co., currency Other due from banks in foreign currency Mortgage loan Land and building Premises and equipment Investment properties Land and building Ltd. and others Yuanta Securities Korea Co., Ltd., etc. Public offering Credit Counselling & Recovery Service and others Credit Counselling & Recovery Service and others 1,500 Right of pledge 25,338 Margin deposit for futures or option Overseas futures option 1,051,006 deposit, etc. 2,494,333 Related to covered bonds 1,910 5,520 Right to collateral and others Right to collateral and others Total 17,395,551 (*) 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). The asset is equivalent to a mortgage-backed debt security. - 145 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) As of December 31, 2022 and 2021 there is no asset acquired through foreclosures. December 31, 2022 December 31, 2021 Investment properties Land Building Other assets Sub-total Land for non-business use Building for non-business use (*1) Movables for non-business use (*2) Real estate assessment provision for non- business use Sub-total Assets held for sale Land Building Others Sub-total Total 6,404 165 6,569 21,302 3,049 165 (1,176) 23,340 2,351 1,832 - 4,183 34,092 2,185 181 2,366 21,156 1,526 120 (1,129) 21,673 2,980 2,557 418 5,955 29,994 (*1) The cumulative depreciation amount as of December 31, 2022 and 2021 is 1,055 million Won and 716 million Won, respectively. (*2) The cumulative depreciation amount as of December 31, 2022 and 2021 is 882 million Won and 907 million Won, respectively. (3) Securities loaned are as follows (Unit: Korean Won in millions): Financial assets at Korean treasury and government December 31, 2022 December 31, 2021 Loaned to Korea Securities Finance FVTOCI bonds 98,027 98,535 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. (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, 2022 and 2021 are as follows (Unit: Korean Won in millions): Securities 7,109,933 Fair values of collaterals subjected to lien December 31, 2022 Fair values of collaterals were disposed or re- Securities 10,785,412 Fair values of collaterals subjected to lien December 31, 2021 Fair values of collaterals were disposed or re- - - - 146 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 19. OTHER ASSETS Details of other assets are as follows (Unit: Korean Won in millions): Lease assets Prepaid expenses Advance payments Non-operational assets Others Total December 31, 2022 December 31, 2021 2,593,578 287,323 99,772 23,340 57,539 3,061,552 1,782,887 189,808 61,042 16,248 38,965 2,088,950 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 measured at fair value Total December 31, 2022 December 31, 2021 8,952,399 8,952,399 4,873,458 4,873,458 (2) Financial liabilities at fair value through profit or loss measured at fair value are as follows (Unit: Korean Won in millions): Deposits Gold banking liabilities Borrowings Securities sold Derivative liabilities Total December 31, 2022 December 31, 2021 35,161 12,113 8,905,125 8,952,399 65,016 241,174 4,567,268 4,873,458 - 147 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 Certificate of deposits Other deposits Sub-total Deposits in foreign currencies: Deposits in foreign currencies Present value discount Customers' deposits for beneficiary Sub-total Total December 31, 2022 December 31, 2021 15,627,300 270,092,855 22,995 3,675,596 60,079 5,255,889 1,196,486 295,931,200 46,263,943 (92,352) 46,171,591 2,418 342,105,209 18,029,136 254,319,473 24,620 2,954,066 92,360 3,586,423 1,286,719 280,292,797 37,643,900 (36,826) 37,607,074 - 317,899,871 22. BORROWINGS AND DEBENTURES (1) Details of borrowings are as follows (Unit: Korean Won in millions): Borrowings in local currency: December 31, 2022 Lenders Interest rate (%) Amount Borrowings from The BOK The BOK Borrowings from Small Enterprise and Market Service and others 0.3 ~ 1.8 3,040,877 0.0 ~ 3.5 2,021,049 government funds Others Sub-total Borrowings in foreign currencies: Borrowings in foreign currencies The Korea Development Bank and others 0.0 ~ 6.7 9,562,082 14,624,008 The Export-Import Bank of Korea and others (0.1) ~ 10.6 11,161,294 Bills sold Call money Bonds sold under repurchase Others Bank and others Other financial institutions agreements Present value discount Total 0.0 ~ 2.4 1.6 ~ 5.5 0.2 ~ 6.4 7,308 400,071 2,313,044 (76,122) 28,429,603 - 148 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Borrowings in local currency: December 31, 2021 Lenders Interest rate (%) Amount Borrowings from The BOK The BOK Borrowings from Small Enterprise and Market Service and others 0.3 3,144,897 0.0 ~ 2.4 2,053,611 government funds Others Sub-total Borrowings in foreign currencies: Borrowings in foreign currencies The Korea Development Bank and others 0.0 ~ 3.1 9,984,518 15,183,026 JPMorgan Chase & Co. and others (0.5) ~ 7.3 8,545,077 Bills sold Call money Bonds sold under repurchase Others Bank and others Other financial institutions agreements Present value discount Total 0.0 ~ 1.3 (0.5) ~ 2.6 (0.5) ~ 10.6 9,111 317,961 749,976 (49,692) 24,755,459 (*) As of December 31, 2021, foreign currency borrowings subject to fair value hedges were included in the amount of 35,694 million Won. (2) Details of debentures are as follows (Unit: Korean Won in millions): December 31, 2022 December 31, 2021 Interest rate (%) Amount Interest rate (%) Amount Face value of bond (*): Ordinary bonds Subordinated bonds Other bonds Sub-total Discounts on bonds Total 0.8 ~ 7.5 1.9 ~ 5.1 0.8 ~ 17.0 0.7 ~ 3.6 1.9 ~ 5.1 0.8 ~ 17.0 37,132,334 5,835,325 1,271,364 44,239,023 (40,537) 44,198,486 37,004,942 6,767,442 911,190 44,683,574 (29,710) 44,653,864 (*) Included debentures under fair value hedge amounting to 3,076,983 million won and 2,366,724 million won as of December 31, 2022 and 2021 respectively. Also, debentures under cash flow hedge amounting to 1,324,812 million won and 819,298 million won are included as of December 31, 2022 and 2021 respectively. - 149 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 Other provisions (*2) Total December 31, 2022 December 31, 2021 82,717 76,508 106,033 280,607 545,865 80,777 74,866 112,296 308,195 576,134 (*1) Provisions for guarantees includes provision for financial guarantee of 47,969 million won and 53,321 million won as of December 31, 2022 and 2021, respectively. (*2) 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, 2022 Stage1 Stage2 Stage3 52,830 15,269 6,767 Total 74,866 1,206 (1,206) (119) 119 (3) - (3,449) (5,969) 44,496 (338) - 10,483 - 24,327 - - 341 - 577 - 7,685 - - - - 7,611 (5,969) 76,508 (*) Recognized as a result of new financial guarantee contract valued at initial fair value. 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, 2021 Stage1 Stage2 Stage3 64,804 16,745 8,043 Total 89,592 2,146 (2,144) (162) (3) (6,964) (9,929) 2,938 52,830 (2) (31) 165 - - - - (6,964) 193 (162) - 636 1 15,269 (1,408) - 6,767 (10,701) 2,939 74,866 (*) Recognized as a result of new financial guarantee contract valued at initial fair value. - 150 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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, 2022 Stage1 67,440 Stage2 Stage3 44,536 320 Total 112,296 14,349 (14,217) (132) (2,619) 2,648 (197) (306) (29) 503 - - - (11,402) 69 67,640 5,527 - 38,188 (457) - 205 (6,332) 69 106,033 For the year ended December 31, 2021 Stage1 63,240 Stage2 Stage3 55,726 3,189 Total 122,155 15,522 (14,965) (557) (2,338) 3,129 (791) (110) (226) 336 - - - (9,005) 131 67,440 871 1 44,536 (1,857) - 320 (9,991) 132 112,296 (3) Changes in asset retirement obligation for the years ended December 31, 2022 and 2021, are as follows (Unit: Korean Won in millions): Beginning balance Provisions provided Provisions used Reversal of provisions unused Unwinding of discount Increase (decrease) of restoration expense,etc. Ending balance For the years ended December 31 2021 2022 80,777 4,082 (7,400) (21) 909 4,370 82,717 68,402 3,235 (5,066) (947) 495 14,658 80,777 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, 2022, 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. - 151 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) Changes in other provisions for the years ended December 31, 2022 and 2021, are as follows (Unit: Korean Won in millions): Beginning balance Provisions provided Provisions used Reversal of provisions unused (*) Foreign currencies translation adjustments Others Ending balance For the years ended December 31 2022 2021 308,195 36,284 (8,540) (54,893) (621) 182 280,607 221,494 85,706 (10,375) (718) 11,957 131 308,195 (*) The Group provided Korean won settlement services for trading transaction settlement between Korea and Iran, investigated by U.S. prosecutors (federal prosecutors, New York state prosecutors) and New York State Department of Financial Services for violations of U.S. sanctions against Iran, Sudan, Syria and Cuba. In this regard, the Office of Foreign Assets Control concluded its investigation in December 2020 urging the bank’s attention without taking any additional sanctions, and New York State Department of Financial Services concluded its investigation in February 2022 without taking any additional sanctions. Meanwhile, in June 2022, the Group reversed the provision related to the investigation of the U.S. Prosecutors, which have not been completed yet, in consideration of the opinion of an independent legal expert that the probability of sanctions by the U.S. Prosecutors in this case is low. (5) Others 1) The Group recognized the provision of the estimated compensation amount related to the miss- selling of the Derivative Linked Fund (DLF) incurred during 2019 and a fine 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. 2) For the year ended December 31, 2020, the Group recognized the provisions as the best estimate due to the expected losses of clients arising from the delay in the redemption of funds by Lime Asset Management and the dispute settlement by the Financial Supervisory Service. As of December 31, 2022, the provision for this case is 122.1 billion won. 3) On October 22, 2021, the Group made a resolution to pay in advance for Platform Asia funds, etc., which are delayed in redemption at the Board of Directors Meeting of Woori Bank, the subsidiary. Provisions for estimated compensation amounts related to the prepayment was recognized as the best estimate of the expenditure. As of December 31, 2022, the sales revenue for Platform Asia, Heritage DLS, and Gen2 DLS sold 85 billion won, 22.3 billion won, and 90.2 billion won, respectively, and provisions is 35.7 billion won, 22.3 billion won, and 12.6 billion won, respectively. - 152 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 24. NET DEFINED BENEFIT LIABILITY(ASSET) The Group’s pension plan is based on the defined benefit retirement pension plan. 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 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. Decrease in profitability of blue- A decrease in profitability of blue-chip bonds will be offset by some 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 liabilities (*) December 31, 2022 December 31, 2021 1,377,545 (1,661,623) (284,078) 1,618,098 (1,591,458) 26,640 (*) Net defined benefit assets of 284,078 million won as of December 31, 2022 are the subtracted amount of the net defined benefit liability of 35,202 million won from the net defined benefit assets of 319,280. Net defined benefit liability of 26,640 million won as of December 31, 2021 are the subtracted amount of the net defined benefit asset of 21,346 million won from the net defined benefit liability of 47,986. (2) Changes in the carrying value of defined benefit obligation are as follows (Unit: Korean Won in millions): Beginning balance Current service cost Interest cost Remeasurements Financial assumption Demographic assumptions Experience adjustments Retirement benefit paid Foreign currencies translation adjustments Others Ending balance For the years ended December 31 2021 2022 1,618,098 166,741 48,238 (356,344) (9) (3,838) (92,914) (69) (2,358) 1,377,545 1,610,680 178,416 39,814 (92,367) (251) (12,155) (106,050) 165 (154) 1,618,098 - 153 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) Changes in the plan assets are as follows (Unit: Korean Won in millions): Beginning balance Interest income Remeasurements Employer’s contributions Retirement benefit paid Others Ending balance For the years ended December 31 2021 2022 1,591,458 49,916 (18,095) 127,979 (87,472) (2,163) 1,661,623 1,564,101 40,927 (15,022) 103,251 (99,523) (2,276) 1,591,458 (4) The fair value of the plan assets by composition is as follows as of December 31, 2022 and 2021. Cash and due from banks December 31, 2022 December 31, 2021 1,661,623 1,591,458 Meanwhile, among plan assets, realized returns on plan assets amount to 31,821 million won and 25,905 million won for the years ended December 31, 2022 and 2021, respectively. The contribution expected to be paid in the next accounting year amounts to 123,043 million won. (5) Amounts related to the defined benefit plan that are recognized in the consolidated statements of comprehensive income are as follows (Unit: Korean Won in millions): Current service cost Net interest expense Cost recognized in net income Remeasurements (*) Cost recognized in total comprehensive income (*) Amount before tax For the years ended December 31 2021 2022 166,741 (1,678) 165,063 (342,096) (177,033) 178,416 (1,113) 177,303 (89,751) 87,552 Retirement benefits related to defined contribution plans recognized as expenses are 4,240 million won, and 4,494 million won for the years ended December 31, 2022 and 2021, 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, 2022 5.25% ~ 5.99% 2.1% ~ 5.84% Issued by Korea Insurance Development Institute Experience rate for each employment classification December 31, 2021 2.40% ~ 3.49% 2.03% ~ 5.56% Issued by Korea Insurance Development Institute Experience rate for each employment classification The weighted average maturity of defined benefit liability is a minimum of 5.38 to a maximum 10.71 years. - 154 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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, 2022 December 31, 2021 (161,428) 189,630 188,392 (163,431) (146,319) 170,529 174,546 (153,712) 25. OTHER FINANCIAL LIABILITIES AND OTHER LIABILITIES Other financial liabilities and other liabilities are as follows (Unit: Korean Won in millions): December 31, 2022 December 31, 2021 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 6,001,858 3,219,349 3,475,118 213,845 822,446 4,631,921 319,161 4,148,621 (20,451) 22,811,868 351,633 338,524 690,157 23,502,025 6,969,170 2,070,639 3,107,456 433,041 782,176 6,708,220 343,213 3,772,437 (15,322) 24,171,030 291,147 265,706 556,853 24,727,883 - 155 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 For trading For cash flow hedge Liabilities For fair value hedge For trading December 31, 2022 42,545 2,620,000 136,550,518 170,000 310,000 51,136 90,134,257 97,197,309 487,852 570,982 958,589 183 568,835 29,801,478 29,874,836 389,338,520 - - 2,041 - - - - 35,745 - - - - - - - 37,786 - - - - - - - - - - - - - - - - - 249,356 440,540 9,308 - - 3,083,082 3,105,901 23,182 - - 100 90,237 1,204,475 - 8,206,181 - - - - - - - 9,080 - - - - - - - 9,080 - - 193,831 - - - - 474,158 - 16,752 - - - - - - - - - - 193,831 - 1,360,535 5,500,970 - 7,929 - - - 673 - 1,544,108 8,905,125 Nominal amount For cash flow hedge Assets For fair value hedge For trading For cash flow hedge Liabilities For fair value hedge For trading December 31, 2021 118,423 340,000 134,196,188 170,000 340,000 7,445 114,072,910 101,117,559 1,079,610 1,686,787 337,916 233 642,963 17,503,553 19,106,573 390,720,160 - - 351 - - - - 11,310 - - - - - - - 11,661 - - 95,103 - - - 16,434 136,185 3,959 - - - - - - - 2,466,893 1,444,634 10,968 - - - - - - 95,103 - 64 27,031 696,963 - 4,803,131 - - - - - - - 7,297 - - - - - - - 7,297 - - 20,287 - - - - 305,443 - 8,552 - - - - - - 993,823 2,345,735 - 8,952 - - - - - 20,287 - - 3,784 - 900,979 4,567,268 Interest rate: Futures Forwards Swaps Purchase options Written options Currency: Futures Forwards Swaps Purchase options Written options Equity: Futures Forwards Swaps Purchase options Written options Total Interest rate: Futures Forwards Swaps Purchase options Written options Currency: Futures Forwards Swaps Purchase options Written options Equity: Futures Forwards Swaps Purchase options Written options Total 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. - 156 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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 3M LIBOR, Compounding SOFR, AUD 3M BBSW, and CD 3M. The nominal amounts of hedging instruments related to USD 3M LIBOR, Compounding SOFR, AUD 3M BBSW, and CD 3M in the hedging relationships of the Group are USD 2,120,000,000, USD 525,000,000, AUD 150,000,000, and 150,000 million Won, 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 December 31, 2022, the Group has applied fair value hedge on fixed interest rate foreign currency denominated debentures amounting to 2,928,127 million Won, and foreign currency loans amounting to 148,856 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 hedging 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, price margin set by counterparty of hedging instrument, and unilateral change in credit risk of any party of hedging instrument. 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 plus spread, AUD BBSW 3M plus spread and EURIBOR 3M 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. - 157 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2) Cash Flow Hedge As of the December 31, 2022, the Group has applied cash flow hedge on local currency denominated debentures amounting to 229,892 million won and debentures on foreign currency amounting to 1,094,920 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. 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 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 value of the hedged item will generally fluctuate in opposite direction. 3) Hedges of Net Investment in Foreign Operations Foreign currency exposure arises from the Group's net investments in Woori America Bank, Woori Cambodia Bank and Hong Kong Woori Investment Bank, and overseas branches, which use USD as their functional currency. The risk arises from fluctuations in the spot exchange rate between USD and KRW. This may result in different net investment amounts. The risk hedged in the net investment hedging is the weakness of KRW against USD, which may reduce the carrying amount of the Group's net investments in Woori America Bank, Woori Cambodia Bank and Hong Kong Woori Investment Bank. A portion of the Group's net investments in Woori America Bank, Woori Cambodia Bank and Hong Kong Woori Investment Bank are hedged in USD denominated foreign currency bonds(Carrying amount as of December 31, 2022: USD 864,390,437) and mitigate foreign exchange risk arising from the net assets of subsidiaries. The bonds was designated as a hedging instrument for changes in the value of net investment resulting from fluctuations in the USD/KRW spot exchange rate. - 158 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 To assess the effectiveness of the hedging instrument, the Group determines the economic relationship between the hedging instrument and the hedged item by comparing (offsetting) changes in the carrying amount of the liability due to changes in the spot exchange rate with changes. The Group's policy is to hedge the net investment only within the principal range of the liability. (3) The nominal amounts of the hedging instrument are as follows (Unit: USD, AUD, EUR, and Korean Won in millions): 1 year or less December 31, 2022 1 year to 5 years More than 5 years Total 150,000,000 150,000 - 2,075,000,000 - - 300,000,000 2,375,000,000 150,000,000 150,000 - - 50,000 140,000 - 190,000 - 270,000,000 - 270,000,000 80,000,000 - 100,000,000 194,780,000 - - 180,000,000 194,780,000 Fair value hedge Interest rate risk Interest rate swap (USD) Interest rate swap (AUD) Interest rate swap (KRW) 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 (USD) Currency swap (EUR) Hedges of net investment in foreign operations Exchange risk Foreign currency bond (USD) 272,390,437 592,000,000 - 864,390,437 Fair value hedge Interest rate risk Interest rate swap (USD) Interest rate swap (AUD) Interest rate swap (EUR) 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 (USD) 1 year or less December 31, 2021 1 year to 5 years More than 5 years Total - 1,550,000,000 150,000,000 - 26,591,163 - 300,000,000 1,850,000,000 150,000,000 26,591,163 - - - 50,000 - 50,000 200,000,000 270,000,000 - 470,000,000 - 180,000,000 - 180,000,000 - 159 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) The average interest rate and average currency rate of the hedging instrument as of December 31, 2022 and 2021 are as follows: Fair value hedge Interest rate risk Interest rate swap (USD) Interest rate swap (USD) Interest rate swap (AUD) Interest rate swap (KRW) Cash flow hedge Interest rate risk Interest rate swap (KRW) Interest rate swap (KRW) Foreign currencies translation risk and interest rate risk Currency swap (USD) Foreign currencies translation risk Currency swap (USD) Currency swap (EUR) Hedges of net investment Exchanging rate risk Foreign currency denominated debentures(KRW/USD) Fair value hedge Interest rate risk Interest rate swap (USD) Interest rate swap (AUD) Interest rate swap (EUR) 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 (USD) December 31, 2022 Average interest rate and average exchange rate Fixed 3.62% receipt and Libor 3M+1.45% floating paid Fixed 2.05% receipt and (C.SOFR)+0.65% paid Fixed 0.84% receipt and BBSW 3M+0.72% paid Fixed 3.13% receipt and CD 3M paid KRW CMS 5Y+0.46% receipt, 3.65% paid KRW CD+0.33% receipt, 1.68% paid USD 1M Libor+0.79% receipt, KRW 0.80% paid, KRW/USD = 1,226.29 USD 1.50% receipt, KRW 1.57% paid, KRW/USD = 1,140.50 EUR 1.98% receipt, KRW 3.68% paid, KRW/EUR = 1,344.08 1,344.37 December 31, 2021 Average interest rate and average exchange rate Fixed 3.62% receipt and Libor 3M + 1.45% floating paid Fixed 0.84% receipt and BBSW 3M+0.72% paid EURIBOR 3M + 0.09% receipt and 1.5% fixed paid KRW CD+0.33% receipt, 1.68% paid USD 1M Libor+0.70% receipt, KRW 0.93% paid, KRW/USD = 1,206.60 USD 1.50% receipt, KRW 1.57% paid, KRW/USD = 1,140.50 - 160 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (5) The amounts related to items designated as hedging instruments are as follows (Unit: USD, AUD, EUR, and Korean Won in millions): Fair value hedge Interest rate risk Interest rate Swap(USD) Interest rate Swap(AUD) Interest rate Swap(KRW) Cash flow hedge Interest rate risk Interest rate swap(KRW) Foreign currency translation risk and interest rate risk Currency swap(USD) Foreign currency translation risk Currency swap(USD) Currency swap(EUR) Hedges of net investment in foreign operations Exchange rate risk Foreign currency bond(USD) December 31, 2022 Carrying amount 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 2,375,000,000 150,000,000 150,000 - 193,831 Derivative assets (designated for hedging) Derivative liabilities (designated for hedging) (247,765) 190,000 2,041 Derivative liabilities (designated for hedging) - 1,690 270,000,000 17,909 - Derivative liabilities (designated for hedging) 180,000,000 17,836 194,780,000 - - 9,080 Derivative liabilities (designated for hedging) Derivative liabilities (designated for hedging) 58,253 9,317 (10,286) 864,390,437 - 1,095,442 Foreign currency bond (28,553) December 31, 2021 Carrying amount 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 USD 1,850,000,000 Interest rate swap AUD 150,000,000 Interest rate swap EUR 26,591,163 Cash flow hedge Interest rate risk Interest rate swap KRW 50,000 Foreign currency translation risk and interest rate risk 95,086 20,287 17 351 - - Currency swap USD 470,000,000 3,631 7,297 Foreign currency translation risk Derivative assets (designated for hedging) Derivative liabilities (designated for hedging) Derivative liabilities (designated for hedging) Derivative liabilities (designated for hedging) Currency swap USD 180,000,000 7,679 - Derivative liabilities (designated for hedging) (83,821) 17 1,896 60,564 8,218 - 161 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (6) Details of carrying amount to hedge and amount due to hedge accounting are as follows (Unit: Korean Won in millions): December 31, 2022 Accumulated amount of fair value hedge adjustments on the hedged item included in the carrying amount of the hedged item Carrying amount of the hedged item Assets Liabilities 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 (*) 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 Hedges of net investment in foreign operations Exchange rate risk Foreign operations net asset (*) After tax amount - 3,076,983 - (199,804) Debentures 257,911 - - 229,892 - - Debentures (3,742) 2,531 - 342,019 - 752,901 - - - Debentures (23,296) 8,648 - Debentures 11,256 (24,600) - 1,095,442 - - Foreign operations net asset 28,553 (38,797) December 31, 2021 Accumulated amount of fair value hedge adjustments on the hedged item included in the carrying amount of the hedged item Carrying amount of the hedged item Assets Liabilities 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 (*) Fair value hedge Interest rate risk Debentures Foreign currency borrowing Cash flow hedge Interest rate risk Debentures Foreign currencies translation risk and interest rate risk Debentures Foreign currencies translation risk Debentures (*) After tax amount - 2,366,724 - 53,160 Debentures 100,343 - Foreign currency borrowings - (17) (17) - Debentures (1,760) 281 - Debentures (53,832) 5,859 - Debentures (7,609) (305) - 35,694 - 49,977 - 556,607 - 212,715 - - - - - 162 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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 10,146 Other net operating income(expense) For the year ended December 31, 2022 Hedge ineffectiveness recognized in profit or loss Line item in the profit or loss that includes hedge ineffectiveness For the year ended December 31, 2021 Hedge ineffectiveness recognized in profit or loss Line item in the profit or loss that includes hedge ineffectiveness Fair value hedge Interest rate risk 16,522 Other net operating income(expense) (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, 2022 Changes in the value of hedging instruments recognized in OCI Hedge ineffective ness recognize d in profit or loss Changes in the value of foreign basis spread recognized in OCI 1,653 37 - 58,253 - (1,721) (969) - 2,046 Amounts reclassified from cash flow hedge reserve to profit or loss Line item affected in profit or loss due to reclassification Other net operating income (expense) 220 Other net operating income (expense) Other net operating income (expense) (53,743) (16,111) Line item recognized in the profit or loss Other net operating income (expense) Other net operating income (expense) Other net operating income (expense) For the year ended December 31, 2021 Changes in the value of hedging instruments recognized in OCI Hedge ineffective ness recognize d in profit or loss Changes in the value of foreign basis spread recognized in OCI 1,641 256 - 60,394 169 (2,300) 8,476 (258) 416 Amounts reclassified from cash flow hedge reserve to profit or loss 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) (52,126) (9,045) Line item recognized in the profit or loss Other net operating income (expense) Other net operating income (expense) Other net operating income (expense) Cash Interest rate risk flow hedge Foreign currencies translation risk and interest rate risk Foreign currencies translation risk Cash Interest rate risk flow hedge Foreign currencies translation risk and interest rate risk Foreign currencies translation risk - 163 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (9) The amounts recognized in profit or loss and other comprehensive income related to the hedging of net investments in foreign operations are as follows (Unit: Korean Won in millions): For the year ended December 31, 2022 Profit or loss recognized in OCI Hedge ineffectiveness recognized in profit or loss Line item which recognized the hedge ineffectiveness (38,797) - - Hedges of net investment in foreign operation Exchange rate risk - 164 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 2021 2022 29,111 21,656 (32,803) 17,964 6,939 49,523 (27,351) 29,111 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 as of December 31,2022 and 2021. 28. EQUITY (1) Details of equity as of December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): December 31, 2022 December 31, 2021 Capital Common stock capital Hybrid securities Capital surplus Paid in capital in excess of par Others Sub-total Capital adjustments Treasury stocks Other adjustments (*1) Sub-total Accumulated other comprehensive income Financial assets at FVTOCI Changes in capital due to equity method Gain (loss) on foreign currency translation of foreign operations Gain (loss) on hedges of net investment in foreign operations Remeasurements of defined benefit plan Gain (loss) on valuation of cash flow hedge Capital related to non-current assets held for sale Sub-total Retained earnings (*2) (*3) Non-controlling interest (*4) Total 3,640,303 3,112,449 643,544 38,841 682,385 (3,819) (1,780,367) (1,784,186) (645,731) 475 (24,202) (20,701) 55,235 (4,282) - (639,206) 23,750,152 2,865,445 31,627,342 3,640,303 2,294,381 643,544 38,841 682,385 (3,819) (1,747,242) (1,751,061) (162,522) (138) (63,781) - (195,944) 5,553 279 (416,553) 21,392,564 3,008,176 28,850,195 (*1) Included 178,060 million Won in capital transaction gains and losses recognized by Woori Bank and (formerly) Woori Financial Group in 2014 and 2,238,228 million Won due to the spin-off of Gyeongnam Bank and Gwangju Bank. (*2) The regulatory reserve for credit losses in retained earnings amounted to 2,966,960 million Won and 2,568,367 million Won as of December 31, 2022 and 2021, respectively in accordance with the relevant article. (*3) The earned surplus reserve in retained earnings amounted to 181,860 million Won and 122,370 million Won as of December 31, 2022 and 2021 in accordance with the Article 53 of the Financial Holding Company Act. - 165 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (*4) The hybrid securities issued by Woori Bank amounting to 2,344,816 million Won and 2,555,166 million Won as of December 31, 2022 and 2021, respectively, are recognized as non-controlling interests. 113,995 million Won and 144,923 million Won of dividends for the hybrid securities issued by Woori Bank are allocated to net profit and loss of the non-controlling interests for the years ended December 31, 2022 and 2021, respectively. (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 (3) Hybrid securities December 31, 2022 December 31, 2021 4,000,000,000 Shares 5,000 Won 728,060,549 Shares 3,640,303 million Won 4,000,000,000 Shares 5,000 Won 728,060,549 Shares 3,640,303 million Won The bond-type hybrid securities classified as owner’s equity are as follows (Unit: Korean Won in millions): Issue date Maturity Interest rate (%) December 31, 2022 December 31, 2021 Securities in local currency 2019-07-18 Securities in local currency 2019-10-11 Securities in local currency 2020-02-06 Securities in local currency 2020-06-12 Securities in local currency 2020-10-23 Securities in local currency 2021-04-08 Securities in local currency 2021-10-14 Securities in local currency 2022-02-17 Securities in local currency 2022-07-28 Securities in local currency 2022-10-25 - - - - - - - - - - Issuance cost Total 3.49 3.32 3.34 3.23 3.00 3.15 3.60 4.10 4.99 5.97 500,000 500,000 500,000 500,000 400,000 400,000 300,000 300,000 200,000 200,000 200,000 200,000 200,000 200,000 300,000 300,000 - - 220,000 (7,551) 3,112,449 - (5,619) 2,294,381 The hybrid securities mentioned above do not have maturity date but are redeemable after 5 years from date of issuance. - 166 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) Accumulated other comprehensive income Changes in the accumulated other comprehensive income are as follows (Unit: Korean Won in millions): Beginning balance For the year ended December 31, 2022 Reclassification adjustments Increase (decrease) (*) effect Income tax Ending balance Net gain (loss) on valuation of financial assets at FVTOCI Changes in capital due to equity method Gain (loss) on foreign currency (162,522) (659,906) 21,498 155,199 (645,731) (138) 6,563 - (5,950) 475 translation of foreign operations (63,781) 33,368 - (28,553) - - 6,211 (24,202) 7,852 (20,701) Gain (loss) on hedges of net investment in foreign operations Remeasurement gain (loss) related to defined benefit plan Gain (loss) on valuation of cash flow hedge Capital related to non-current assets (195,944) 346,553 - (95,374) 55,235 5,553 (10,373) (220) 758 (4,282) held for sale Total 279 (416,553) (385) (312,733) - 21,278 106 68,802 - (639,206) (*) The increase(decrease) of financial asset valuation profit or loss at fair value through other comprehensive income and non-current assets held for sale are changes due to the period evaluation, and the reclassification adjustments amounting to (10,254) million Won and 279 million Won are due to disposal of equity securities and non-current assets held for sale, respectively during the period. Beginning balance For the year ended December 31, 2021 Reclassification adjustments Increase (decrease) (*) effect Income tax Ending balance Net gain (loss) on valuation of financial assets at FVTOCI Changes in capital due to equity method 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 Capital related to noncurrent assets held for sale Total (9,833) (174,113) (32,624) 54,048 (162,522) (2,609) 3,885 - (1,414) (138) (298,363) 239,614 - (5,032) (63,781) (261,195) 90,337 - (25,086) (195,944) (1,386) 6,416 1,221 (698) 5,553 1,226 (572,160) (1,306) 164,833 - (31,403) 359 22,177 279 (416,553) (*) The increase(decrease) of financial asset valuation profit or loss at fair value through other comprehensive income and non-current assets held for sale are changes due to the period evaluation, and the reclassification adjustments amounting to (2,220) million Won, 946 million Won and (947) million Won are due to disposal of equity securities, equity method investments and non-current assets held for sale, respectively during the period. - 167 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (5) Regulatory Reserve for Credit Loss In accordance with Article 26 ~ 28 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, 2022 2,966,960 (127,485) 2,839,475 December 31, 2021 2,568,367 398,593 2,966,960 2) Provision of regulatory reserve for credit loss, adjusted income after the provision of regulatory reserve and others 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 before regulatory reserve Provision of regulatory reserve (reversal) for credit loss Adjusted net income after the provision of regulatory reserve Dividends to hybrid securities Adjusted net income after regulatory reserve and dividends to hybrid securities Adjusted EPS after regulatory reserve and the dividends to hybrid securities (Unit: Korean Won) (6) Treasury stock For the years ended December 31 2022 3,323,982 (127,485) 3,451,467 (91,756) 2021 2,807,371 398,593 2,408,778 (66,250) 3,359,711 2,342,528 4,615 3,234 Details of treasury stocks are as follows (Unit: Shares, Korean Won in millions): December 31, 2022 December 31, 2021 Number of shares Carrying amount Number of shares 2 343,989 343,991 Carrying amount - 3,819 3,819 Beginning balance Acquisition Ending balance 343,991 - 343,991 3,819 - 3,819 - 168 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 29. DIVIDENDS (1) Dividends per share and the total dividends for the fiscal year ending December 31, 2021 were 750 Won and 546,044 million Won, respectively, and the dividends were approved at the regular general shareholders' meeting held on March 25, 2022 and were paid in April 2022. (2) On July 22, 2022, in accordance with a resolution of the Board of Directors, the Group declared the interim dividend of 150 Won per share (total dividend of 109,209 million Won) with June 30, 2022 as base date, and the dividends were paid in August 2022. (3) A dividend in respect of the year ended December 31, 2022, of 980 won per share, amounting to a total dividend of 713,497 million won, is to be proposed to shareholders at the annual general meeting on March 24, 2023. These financial statements do not include this dividend payable. 30. NET INTEREST INCOME (1) Interest income recognized is as follows (Unit: Korean Won in millions): For the years ended December 31 2021 2022 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 Subtotal Total 106,698 632,615 515,246 244,331 13,109,022 46,637 13,399,990 14,654,549 45,803 381,814 324,920 46,600 9,065,074 30,538 9,142,212 9,894,749 (2) Details of interest expense recognized are as follows (Unit: Korean Won in millions): Interest on deposits due to customers Interest on borrowings Interest on debentures Other interest expense Interest on lease liabilities Total For the years ended December 31 2021 2022 4,120,811 598,185 1,036,191 195,090 7,693 5,957,970 1,906,858 219,994 727,093 47,647 7,436 2,909,028 - 169 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 Fees and commission received related to lease Other fees Total For the years ended December 31 2022 2021 185,545 189,856 130,712 56,812 96,713 85,340 594,897 111,211 266,447 10,190 572,563 199,414 2,499,700 182,794 197,125 131,941 56,210 73,894 76,428 573,048 100,991 216,203 10,220 374,900 177,951 2,171,705 (2) Details of fees and commissions expense incurred are as follows (Unit: Korean Won in millions): Fees and commissions paid Credit card commission Securities business commission Others Total 32. DIVIDEND INCOME For the years ended December 31 2021 2022 325,536 446,885 1,414 15,695 789,530 (1) Details of dividend income recognized are as follows (Unit: Korean Won in millions): Dividend income related to financial assets at FVTPL Dividend income related to financial assets at FVTOCI Total 136,136 23,846 159,982 For the years ended December 31 2021 2022 261,734 425,796 1,605 11,795 700,930 284,683 24,528 309,211 (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 For the years ended December 31 2021 2022 23,846 24,528 - 170 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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 or loss 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 2021 2022 238,502 325,649 - 238,502 102 325,751 (2) Details of net gain or loss on financial instruments at fair value through profit or loss measured at fair value and financial instruments held for trading are as follows (Unit: Korean Won in millions): Financial assets at FVTPL Securities Gain on transactions and valuation Loss on transactions and valuation Derivatives (Held for trading) Sub-total Loans Gain on transactions and valuation Loss on transactions and valuation Other financial assets Gain on transactions and valuation Loss on transactions and valuation Sub-total Sub-total Sub-total Interest rates derivatives Gain on transactions and valuation Loss on transactions and valuation Sub-total Currency derivatives Gain on transactions and valuation Loss on transactions and valuation Sub-total Equity derivatives Gain on transactions and valuation Loss on transactions and valuation Other derivatives Gain on transactions and valuation Loss on transactions and valuation Sub-total Sub-total Sub-total Net, total For the years ended December 31 2022 294,667 (553,093) (258,426) 24,005 (2,219) 21,786 21,602 (12,314) 9,288 (227,352) 5,216,543 (3,625,834) 1,590,709 14,601,674 (15,713,074) (1,111,400) 2,836,843 (2,850,334) (13,491) 49 (13) 36 465,854 238,502 2021 249,803 (197,172) 52,631 24,674 (6,770) 17,904 17,034 (12,370) 4,664 75,199 2,020,004 (1,746,752) 273,252 9,685,798 (9,715,260) (29,462) 1,754,671 (1,744,294) 10,377 64 (3,781) (3,717) 250,450 325,649 (3) Details of net gain (loss) on financial instruments at fair value through profit or loss designated as upon initial recognition are as follows (Unit: Korean Won in millions): Gain (loss) on equity-linked securities For the years ended December 31 2022 2021 - 102 - 171 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 34. NET GAIN OR LOSS ON FINANCIAL ASSETS AT FVTOCI Details of net gain or loss on financial assets at FVTOCI recognized are as follows (Unit: Korean Won in millions) : Gain (Loss) on redemption of securities Gain (Loss) on transactions of securities Total For the years ended December 31 2022 2021 (7) (21,491) (21,498) (23) 32,647 32,624 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): Reversal(provision) due to credit loss on financial assets measured at FVTOCI Provision for impairment loss due to credit loss on securities at amortized cost Provision for impairment loss due to credit loss on loan and other financial assets at amortized cost Provision for(reversal of) provision on guarantee Reversal of unused loan commitment Total For the years ended December 31 2022 2021 827 (3,151) (881,668) (7,611) 6,332 (885,271) (4,909) (664) (551,957) 10,701 9,991 (536,838) - 172 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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): Employee benefits Short-term employee benefits Salaries Employee fringe benefits Share based payment Retirement benefit service costs Termination Subtotal 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 Maintenance Water, light, and heating Vehicle maintenance Others Sub-total Total For the years ended December 31 2022 2021 1,980,363 1,775,018 590,255 9,632 169,303 162,019 2,911,572 521,827 80,130 157,905 233,495 127,186 84,204 53,733 160,464 6,799 10,716 8,309 20,670 23,266 16,165 14,831 98,618 1,096,491 4,529,890 545,534 17,774 181,797 180,872 2,700,995 524,154 83,879 135,015 231,852 117,875 79,145 44,248 101,384 6,449 7,449 7,642 10,692 20,808 14,520 11,590 49,714 922,262 4,147,411 (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 2022 2021 1,403,083 71,179 257,910 249,509 1,981,681 562,935 61,271 106,253 172,044 902,503 - 173 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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 2022 2021 1,181,663 423,834 402,057 250,268 - 736,112 2,993,934 450,698 406,276 367,961 93,084 1,947 469,938 1,789,904 (*) Other expense includes 14,664 million Won and 13,963 million Won for intangible asset amortization cost and 388,895 million Won and 250,971 million Won for lease depreciation cost for the years ended December 31, 2022 and 2021, respectively. - 174 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) Share-based payment Details of performance condition share-based payment granted to executives as of December 31, 2022 and 2021 are as follows. 1) Performance condition share-based payment Subject to Type of payment Vesting period Date of payment Fair value (*1) Valuation method Expected dividend rate Expected maturity date Number of shares remaining Number of shares granted (*2) Subject to Type of payment Vesting period Date of payment Fair value (*1) Valuation method Expected dividend rate Expected maturity date Number of shares remaining Number of shares granted (*2) Subject to Type of payment Vesting period Date of payment Fair value (*1) Valuation method Expected dividend rate Expected maturity date Number of shares remaining Number of shares granted (*2) Subject to Type of payment Vesting period Date of payment Fair value (*1) Valuation method Expected dividend rate Expected maturity date Number of shares remaining Number of shares granted (*2) As of December 31, 2022 As of December 31, 2021 As of December 31, 2022 As of December 31, 2021 As of December 31, 2022 As of December 31, 2021 As of December 31, 2022 As of December 31, 2021 As of December 31, 2022 As of December 31, 2021 As of December 31, 2022 As of December 31, 2021 As of December 31, 2022 As of December 31, 2021 As of December 31, 2022 As of December 31, 2021 - 175 - Shares granted for the year 2019 Cash-settled January 1, 2019 ~ December 31, 2022 2023-01-01 12,406 Won Black-Scholes Model 5.05% - 602,474 shares 602,474 shares 602,474 shares 602,474 shares Shares granted for the year 2020 Cash-settled January 1, 2020 ~ December 31, 2023 2024-01-01 11,796 Won Black-Scholes Model 5.05% 1 year 944,343 shares 944,343 shares 944,343 shares 944,343 shares Shares granted for the year 2021 Cash-settled January 1, 2021 ~ December 31, 2024 2025-01-01 11,215 Won Black-Scholes Model 5.05% 2 years 1,105,515 shares 1,105,515 shares 1,105,515 shares 1,105,515 shares Shares granted for the year 2022 Cash-settled January 1, 2022 ~ December 31, 2025 2026-01-01 10,662 Won Black-Scholes Model 5.05% 3 years 968,119 shares - 968,119 shares - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (*1) As the amount of payment varies according to the base price (the arithmetic average of the weighted average stock price of transactions in the past one week, the past one month, and the past two months) at the date of payment, the fair value is calculated to measure the liability according to the Black Scholes model based on the base price at the time of each settlement. (*2) It is a system in which the amount of stock payable is determined at the beginning, and the payment rate is determined in accordance with the degree of achievement of the pre-set performance target. Performance is evaluated by long- term performance indicators such as relative shareholder return, net profit, 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, 2022 and 2021, the carrying amount of the liabilities related to the performance condition share-based payments recognized by the Group amounts to 41,334 million won and 31,597 million won, respectively, including the carrying amount of liabilities related to key management of 17,494 million Won and 13,319 million Won, respectively. - 176 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 37. 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 Reversal of impairment losses 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 2022 2021 98,858 80,268 - (11,133) (17,728) 69,997 1,744 (7,405) (12,411) 62,196 (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 2022 158,778 (173,924) (15,146) 2021 188,129 (160,833) 27,296 (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 2022 2021 22,798 599 55,852 310 79,219 158,778 15,056 70,834 51,083 166 50,990 188,129 (*) ‘Others’ for the year ended December 31, 2022 include 46,536 million Won of other special gain related to other provisions. (4) Details of other non-operating expenses recognized are as follows (Unit: Korean Won in millions): Depreciation on investment properties Operating expenses on investment properties Losses on disposal of investments in joint ventures and associates Losses on disposal of premises and equipment, intangible assets and other assets Impairment losses of premises and equipment, intangible assets and other assets Donation Others (*) Total For the years ended December 31 2022 2021 3,925 1,448 3,690 3,177 260 50,547 110,877 173,924 2,809 1,174 174 3,354 656 39,335 113,331 160,833 (*) ‘Others’ for the year ended December 31, 2022 include 63,354 million Won of other special loss - 177 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 related to embezzlement incidents and 18,458 million Won of other special loss related to other provisions. ‘Others’ for the year ended December 31, 2021 include 75,921 million Won of other special loss related to other provisions. 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 Income tax expense directly attributable to other equity Sub-total Deferred tax expense Change in deferred tax assets (liabilities) due to temporary differences Income tax expense(income) directly attributable to equity Others Income tax expense Sub-total For the years ended December 31 2022 2021 1,332,636 (13,982) 7,852 1,326,506 (234,909) 68,802 993 (165,114) 1,161,392 884,843 2,074 - 886,917 32,776 22,177 - 54,953 941,870 (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 2022 4,485,374 1,154,285 2021 3,749,241 960,095 (73,488) (41,335) 26,793 18,933 (14,088) 67,890 7,107 1,161,392 25.90% 3,078 1,099 (18,225) 941,870 25.10% (*) The applicable income tax rate: % 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. - 178 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) Changes in deferred tax assets and liabilities for the years ended December 31, 2022 and 2021, are as follows (Unit: Korean Won in millions): For the year ended December 31, 2022 Beginning balance Business combination Recognized as income (expense) Recognized as other comprehensive income (expense) Ending Balance 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 (*) Net deferred tax assets 273,356 15,260 (149,805) (82,482) (34,625) 8,244 (194,463) 449,615 (432,001) 7,424 100,571 (116,907) (155,813) - - - - - - - - - - - (1,473) (1,473) (55,410) 155,199 373,145 11,139 159,664 (7,848) 14,520 (318) 25,370 15,760 (18,437) 904 (13,342) 33,982 165,984 (5,844) 20,555 758 - - - 10,617 (90,330) (20,105) 7,926 - (95,590) (169,093) 369,785 216 - - 14,063 68,802 (450,222) 8,328 87,229 (70,335) 77,500 (*) Among the deferred tax assets and liabilities classified as ‘Others,’ the deferred tax asset arising from unused tax losses amounts to 3,536 million won. For the year ended December 31, 2021 Recognized as income (expense) Recognized as other comprehensive income (expense) Ending Balance Beginning balance 276,495 (57,187) 54,048 273,356 33,597 (17,282) (1,055) 15,260 (142,352) (66,228) (46,495) (6,755) (16,254) 11,870 8,221 23 (170,196) 442,007 (424,906) 9,485 85,173 (118,964) (114,163) (24,267) 32,890 (7,291) (2,061) 15,398 7,089 (63,827) (698) - - - - (149,805) (82,482) (34,625) 8,244 (194,463) (25,282) 449,615 196 - - (5,032) 22,177 (432,001) 7,424 100,571 (116,907) (155,813) 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 (*) Net deferred tax assets (*) Among the deferred tax assets and liabilities classified as ‘Others,’ the deferred tax asset arising from unused tax losses amounts to 8,838 million won. - 179 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (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, 2022 December 31, 2021 330,376 49,405 (8,898,834) (8,519,053) 303,067 63,908 (8,025,672) (7,658,697) No deferred income tax asset has been recognized for the deductible temporary difference of 325,601 million Won associated with investments in subsidiaries as of December 31, 2022, because it is not probable that the temporary differences will be reversed in the foreseeable future 4,775 million won associated with others, respectively, as of December 31, 2022, due to the uncertainty that these will be realized in the future. No deferred income tax liability has been recognized for the taxable temporary difference of 8,898,835 million won associated with investment in subsidiaries as of December 31, 2022, 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, 2022, 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 36,967 10,828 1 year or less 1 – 2 years 2 – 3 years More than 3 years 1,610 - (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 valuation of equity method investments Gain on foreign currency translation of foreign operations Gain on valuation of hedge accounting of the net investment in foreign operations Remeasurements of the net defined benefit liability Gain on derivatives designated as cash flow hedge Total December 31, 2022 213,876 December 31, 2021 58,677 2,078 (3,766) 9,938 9,815 (20,584) (86) 209,193 5,689 - 74,790 (843) 140,391 (6) Current tax assets and liabilities are as follows (Unit: Korean Won in millions): Current tax assets Current tax liabilities December 31, 2022 December 31, 2021 53,274 843,555 22,598 584,491 - 180 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 39. EARNINGS PER SHARE (“EPS”) (1) 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): For the years ended December 31 2021 2022 Net income attributable to common shareholders Dividends to hybrid securities Net income attributable to common shareholders Weighted average number of common shares outstanding (Unit: million shares) Basic EPS (Unit: Korean Won) 3,141,680 (91,756) 3,049,924 728 4,191 2,587,936 (66,250) 2,521,686 724 3,481 (2) The weighted average number of common shares outstanding is as follows (Unit: number of shares, days): For the year ended December 31, 2022 Period Number of shares Dates (Unit: Day) Accumulated number of shares outstanding during period Common shares issued at the beginning of the period Treasury stocks 2022-01-01 ~ 2022-12-31 2022-01-01 ~ 2022-12-31 728,060,549 (343,991) 365 365 Sub-total (①) Weighted average number of common shares outstanding (②=(①/365)) 265,742,100,385 (125,556,715) 265,616,543,670 727,716,558 For the year ended December 31, 2021 Period Number of shares Dates (Unit: Day) Accumulated number of shares outstanding during period 2021-01-01 ~ 2021-12-31 2021-01-01 ~ 2021-12-31 722,267,683 (2) 365 365 263,627,704,295 (730) Common shares issued at the beginning of the period Treasury stocks Issuance of new shares (comprehensive share exchange) Acquisition of treasury stocks 2021-08-10 ~ 2021-12-31 2021-08-10 ~ 2021-12-31 5,792,866 (343,989) 144 144 Sub-total (①) Weighted average number of common shares outstanding (②=(①/365)) 834,172,704 (49,534,416) 264,412,341,853 724,417,375 Diluted EPS is equal to basic EPS because there is no dilution effect for the years ended December 31, 2022 and 2021. - 181 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 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, 2022 December 31, 2021 39,684 501,921 97,920 6,847,713 7,487,238 150,075 3,014,228 1,144,498 4,308,801 125,547 11,921,586 38,897 622,758 111,195 7,215,557 7,988,407 243,072 3,186,513 778,088 4,207,673 791,729 12,987,809 (*) Includes financial guarantees of 3,095,091 million won and 3,960,383 million won as of December 31, 2022 and 2021, respectively. (2) Details of unused loan commitments and others are as follows (Unit: Korean Won in millions): Loan commitments Other commitments (*) December 31, 2022 December 31, 2021 118,172,070 7,107,828 114,414,462 5,652,557 (*) As of December 31, 2022 and 2021, the amount of unsecured bills (purchase note sales) and discounts on electronic short-term bond sales (purchase) are 2,505,399 million won and 2,225,226 million won, respectively. (3) Litigation case Litigation case that the key Group is a defendant in a lawsuit pending (excluding fraud lawsuits and those lawsuits that are filed only to extend the statute of limitation, etc.) are 531 cases (litigation value of 577,128 million Won) and 475 cases (litigation value of 578,505 million Won) as of December 31, 2022 and 2021 respectively, and provisions for litigations are 33,877 million Won and 24,823 million Won. - 182 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) Other commitments 1) 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% of interest (58.6% of voting rights) in July 2019, and to acquire additional 21.3% of 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 will acquire the second transaction stake at the end of March 2023. In regard to this acquisition, the Group recognized 174,780 million Won as other financial liabilities for the second sales agreement. 2) As of December 31, 2022, Woori Asset Trust Co., Ltd., a subsidiary, has agreed to carry out construction completion obligations for 87 constructions, which includes the construction of residential and commercial complexes in Busan (U-dong, Haeundae-gu). Land Trust responsible for Construction and Management is a trust that bears the obligation to fulfill the responsibility of the constructor and to compensate the loan financial institution for damages if the Group fails to fulfill the construction completion obligation. As of December 31, 2022, the total PF loan amount of PF loan institutions invested in the project of the Land Trust responsible for Construction and Management is 3,607,592 million Won. Although additional losses may occur in relation to the construction completion obligations, the financial statements as of December 31, 2022 do not reflect these effects since losses are unlikely and the amount cannot be estimated reliably. 3) Pursuant to some contracts related to asset securitization, the Group utilizes various prerequisites as triggering events causing early redemption, limiting risks that investors bear due to change in asset quality. Breach of such triggering clause leads to an early redemption of the securitized bonds. 4) As of December 31, 2022, Woori Asset Trust Co., Ltd, a subsidiary, is able to borrow part of its total business expense related to its 13 development trust contracts including Boutique Terrace Haeundae Hotel from trust accounts, and the maximum amount of additional loan amount (unused loan commitment) is 52,783 million Won. In relation to those projects, the Group's trust accounts loan is not unconditional payment obligation, and it would be judged by considering all related matters such as its own account and the fund balance plan for each trust projects. - 183 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 41. RELATED PARTY TRANSACTIONS Related parties of the Group as of December 31, 2022 and 2021, and assets and liabilities recognized, guarantees and commitments, major transactions with related parties and compensation to key management for the years ended December 31, 2022 and 2021 are as follows. Please refer to Note 13 for the details of joint ventures and associates. (1) Assets and liabilities from transactions with related parties are as follows (Unit: Korean Won in millions): Associates W Service Networks Co., Related parties Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. LOTTE CARD Co. Ltd. K BANK Co., Ltd. Others (*1) Account title Loans 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 Account receivables Loss allowance Other assets Deposits due to customers Other liabilities Loans Account receivables Other liabilities Loans Loss allowance Other assets Deposits due to customers Other liabilities December 31, 2022 December 31, 2021 120 3,298 7 109 2 4,450 40 3,433 (46) 1,764 6 50,000 16 (30) - 35,986 74 3 31 108,156 68,660 (34) 768 3,622 119 20 2,832 6 425 2 1,557 - 3,425 (6) 1,887 2 3,750 - (39) 10 13,482 91 99 29 84,935 73,940 (124) 739 1,063 3 (*1) Others include IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, Woori Growth Partnerships New Technology Private Equity Fund, Partner One Value Up I Private Equity Fund, and etc., as of December 31, 2022 and 2021. - 184 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) Gain or loss from transactions with related parties are as follows (Unit: Korean Won in millions): Associates W Service Network Co., Ltd. Related parties Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. LOTTE CARD Co., Ltd. K BANK Co., Ltd. Others (*) Account title Other income Interest expenses Fees expenses Other expenses Interest expenses Fees expenses Other expenses Interest income Interest expenses Provision of impairment losses due to credit loss Other expenses Interest income Fees income Interest expenses Reveral of impairment losses due to credit loss Fees income Fees expenses Interest income Fees income Interest expenses Reversal of impairment losses due to credit loss Provision of impairment losses due to credit loss For the year December 31 2022 2021 - 14 543 1,907 40 3,730 139 141 3 44 52 83 7,701 1,902 27 698 937 713 7,138 10 92 1 30 7 612 1,878 4 3,503 68 80 2 1 92 196 10,248 462 59 1,952 636 679 5,546 17 2 - (*) Others include Woori Growth Partnerships New Technology Private Equity Fund, Partner One Value Up I Private Equity Fund, and etc., as of December 31, 2022 and 2021. - 185 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (3) Major loan transactions with related parties for the years ended December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): For the year ended December 31, 2022 Related parties Associates W Service Network Co., Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. LOTTE CARD Co., Ltd. K BANK Co., Ltd. Godo Kaisha Oceanos 1 Woori Zip 1 Woori Zip 2 Central Network Solutions Co., Beginning balance Loan Collection Others 252 15 2,399 3,750 411 43,033 - - - - - - - (1,653) (956) (1,356) 352 15 2,407 50,000 315 41,467 - - Ending balance (*) 120 2 3,433 50,000 3 39,814 11,819 16,776 Ltd. - 251 - - 251 (*) Payments that occurred for business reasons among related parties are excluded and net increase or decrease was used for limited credit loan. For the year ended December 31, 2021 Related parties Associates W Service Network Co., Ltd. Korea Credit Bureau Co., Ltd. Korea Finance Security Co., Ltd. LOTTE CARD Co., Ltd. K BANK Co., Ltd. Godo Kaisha Oceanos 1 Woori Zip 1 Woori Zip 2 Beginning balance Loan Collection Others 249 10 348 3,750 1,774 - - - - - - - - (1,003) (346) (492) 248 11 333 - 1,769 - 13,121 18,624 Ending balance (*) 20 2 3,425 3,750 99 43,033 12,775 18,132 20 2 3,425 3,750 99 43,033 12,775 18,132 21 1 3,440 7,500 104 44,036 - - (*) Payments that occurred for business reasons among related parties are excluded and net increase or decrease was used for limited credit loan. - 186 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) Details of changes in major deposits due to customers with related parties for the years ended December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Associates W Service Networks Co., Ltd Related parties Partner One Value Up I Private Equity Fund Korea Credit Bureau Co., Ltd. For the year ended December 31, 2022 Beginning balance 1,180 Increase Decrease 1,200 1,180 329 - 550 3,000 779 - Ending balance (*) 1,200 100 3,000 (*) Details of payment between related parties, demand deposit due to customers and etc. are excluded. Associates W Service Networks Co., Ltd Related parties Partner One Value Up I Private Equity Fund Korea Credit Bureau Co., Ltd. For the year ended December 31, 2021 Beginning balance 1,180 Increase Decrease Ending balance (*) 1,180 1,180 1,180 863 1,000 637 - 1,171 1,000 329 - (*) Details of payment between related parties, demand deposit due to customers and etc. are excluded. (5) There are no major borrowing transactions with related parties for the years ended December 31, 2022 and 2021. (6) Guarantees provided to the related parties are as follows (Unit: Korean Won in millions): Warrantee Korea Finance Security Co., Ltd. Korea Credit Bureau Co., Ltd. W Service Network Co., Ltd. K BANK Co., Ltd. LOTTE CARD Co. Ltd. D-Custody Co., Ltd. December 31, 2022 627 33 60 297 450,000 10 December 31, 2021 835 33 180 201 500,000 - Warranty Unused loan commitment Unused loan commitment Unused loan commitment Unused loan commitment Unused loan commitment Unused loan commitment As of December 31, 2022 and 2021, the recognized payment guarantee provisions are 80 million won and 93 million won, respectively, in relation to the guarantees provided to the related parties above. - 187 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (7) Amount of commitments with the related parties Warrantee IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership WooriG Senior Loan General Type Private Investment Trust No.1 Woori Seoul Beltway Private Special Asset Fund No.1 Woori-Q Corporate Restructuring Private Equity Fund Union Technology Finance Investment Association Genesis Eco No.1 Private Equity Fund Genesis Environmental Energy Company 1st Private Equity Fund JC Assurance No.2 Private Equity Fund Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund WooriG Oncorp Corporate support of Major Industry General Type Private Investment Trust (Type 2) BTS 2nd Private Equity Fund STASSETS FUND III Together Korea Government Private Securities Investment Trust No.3 December 31, 2022 December 31, 2021 4,664 - 37,146 12,555 - - - 1,351 325 39 6,974 13,500 990,000 4,664 14,284 39,458 11,109 2,250 195 916 1,351 425 669 - - - Warranty Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment Securities purchase commitment (8) Major investment and Recovery transactions The details of major investment and recovery transactions with related parties for the year ended December 31, 2022 and 2021 are as follows (Unit: Korean Won in millions): Related parties Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 Woori High Plus Bond Sec Feeder Inv Trust 3(USD) Woori BANKPLUS IPO 10 FEEDER FUND 2(BALANCED BOND) Woori Two-year Bond Securities Investment Trust 2(Bond) Woori China Mainland Stock Securities Investment Trust H(Securities) Woori Long-term government bond securities Investment Trust No.1 Woori Republic of Korea Treasury Bond Active ETF(Bond) Woori K-New Opening Target Return Securities Investment Trust(Equity) Woori 2023 Maturity Securities Investment Trust(Bond) Woori 2024 Maturity Securities Investment Trust 1(Bond) Woori BIG SATISFACTION SHINJONG MMF 3RD Woori MULTI RETURN PRIVATE EQUITY 1 Woori 2024 December Maturity Securities Investment Trust 1(Bond) Woori Two-year Bond Securities Investment Trust 3(Bond) Woori G Oncorp Corporate support of Major Industry General Type Private Investment Trust (Type 2) Investment and recovery transactions of associates are described in Note 13.(2) (*) For the year ended December 31, 2022 Investment and others (*) Recovery and others (*) - - 200 - - - 3,000 200 200 200 320,000 - 200 - 630 21,606 1,052 - 213 443 1,951 - - - - - 8,559 - 209 - - 188 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 Related parties For the year ended December 31, 2021 Investment and others (*) Recovery and others (*) Woori China Mainland Stock Securities Investment Trust Woori Long-term government bond securities Investment Trust No.1 Woori New MMF No.3 Woori Multi-Return Securities Investment Trust 1 Woori Multi-Return Securities Investment Trust 2 (Balanced Bond) Woori Short term Plus Securities Investment Trust Woori Smart New Deal 30 Target Conversion Securities Investment trust No.3 Woori Smart Balance Securities Investment Trust (Stock) Woori ACE Public Offering stock Alpha Securities Investment Trust (Bond Mixed) WooriG Oncorp Corporate support of Major Industry General Type Private Investment Trust (Type 2) WooriG Public Offering stock 10 securities Investment Trust [Bond mixed] C(F) WooriG IGIS Securities Investment Trust [Bond] C(F) (*) Investment and recovery transactions of associates are described in Note 13.(2) - 2,000 - 8,000 8,000 200 200 500 200 831 - - 568 - 20,105 - - - - - - - 1,064 1,306 (9) Compensation for key management is as follows (Unit: Korean Won in millions): Short-term employee salaries Retirement benefit service costs Share-based compensation Total For the years ended December 31 2021 2022 21,990 937 4,234 27,161 20,742 815 6,970 28,527 Key management includes executives and directors of Woori Financial Group and major subsidiaries, and also includes CEO of other subsidiaries. Outstanding assets from transactions with key management amount to 3,620 million won and 3,821 million won, as of December 31, 2022 and 2021 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 12,660 million won and 11,542 million won, respectively, as of December 31, 2022 and 2021. - 189 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 42. TRUST ACCOUNTS (1) Trust accounts of the Woori Bank are as follows (Unit: Korean Won in millions): Total assets Trust accounts December 31, 2022 71,677,258 December 31, 2021 69,472,846 Operating income For the years ended December 31 2022 2021 1,121,069 876,800 (2) Receivables and payables between the Woori 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, 2022 December 31, 2021 42,337 170,417 1,804,847 1,975,264 35,448 234,136 1,621,209 1,855,345 (3) Significant transactions between the Woori 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 2021 2022 131,656 1,158 132,814 619 38,583 39,202 117,459 10,599 128,058 503 11,391 11,894 - 190 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (4) Principal guaranteed trusts and principal and interest guaranteed trusts are as follows; 1) The carrying amount of principal guaranteed trusts and principal and interest guaranteed trusts that Woori Bank provides are as follows (Unit: Korean Won in millions): December 31, 2022 December 31, 2021 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 8,230 446 1,551 10,227 2,790 460,839 687,971 26,563 6,792 950 1,185,905 19 335 354 1,196,486 8,932 627 1,558 11,117 3,004 486,203 749,317 28,354 7,282 1,076 1,275,236 19 348 367 1,286,720 2) The amounts that the Woori 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, 2022 December 31, 2021 - 2 - 191 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 43. LEASES (1) Lessor 1) Finance lease ① The total investment in finance lease and the present value of the minimum lease payments to be recovered are as follows (Unit: Korean Won in millions): December 31, 2022 Within one year After one year but within two years After two years but within three years After three years but within four years After four years but within five years After five years Total Total investment in lease 160,181 231,075 366,599 501,034 368,420 19 1,627,328 Net investment in lease 146,749 215,497 338,709 452,099 314,696 18 1,467,768 December 31, 2021 Within one year After one year but within two years After two years but within three years After three years but within four years After four years but within five years After five years Total Total investment in lease 70,740 133,398 239,895 367,991 486,490 2 1,298,516 Net investment in lease 69,030 124,904 218,911 331,685 429,034 1 1,173,565 ② The unrealized interest income of the finance lease is as follows. (Unit: Korean Won in millions) Total investment in lease Net investment in lease Present value of minimum lease payments Present value of unguaranteed residual value Unearned interest income December 31, 2022 December 31, 2021 1,627,328 1,467,768 1,467,768 - 159,560 1,298,516 1,173,565 1,173,565 - 124,951 - 192 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 2) Operating lease ① The details of operating lease assets are as follows (Unit: Korean Won in millions): Prepaid lease assets Operating lease assets Acquisition cost Accumulated depreciation Net carrying value Total December 31, 2022 December 31, 2021 3,121 3,320,275 (729,818) 2,590,457 2,593,578 4,579 2,299,968 (521,660) 1,778,308 1,782,887 ② The details of changes in operating lease assets as of December 31, 2022 are as follows and there is no details of changes in operating lease assets as of December 31, 2021 (Unit: Korean Won in millions) Beginning balance Acquisition Disposal Depreciation Others Ending balance December 31, 2022 December 31, 2021 1,778,308 1,321,251 (138,189) (388,895) 17,982 2,590,457 1,116,175 984,093 (93,138) (250,971) 22,149 1,778,308 ③ The future lease payments to be received under the lease contracts are as follows (Unit: Korean Won in millions) Within one year After one year but within two years After two years but within three years After three years but within four years After four years but within five years Total December 31, 2022 December 31, 2021 567,998 526,899 420,244 275,080 86,606 1,876,827 377,153 347,539 262,176 170,391 79,555 1,236,814 ④ There is no adjusted lease payments recognized as profit or loss for the years ended December 31, 2022 and 2021. - 193 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 (2) Lessee 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 December 31, 2022 December 31, 2021 170,781 152,145 33,007 355,933 151,259 155,707 38,275 345,241 2) Total cash outflows from lease are as follows (Unit: Korean Won in millions): Total cash outflows from lease For the years ended December 31 2022 s2021 192,540 180,884 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): Lease payments for short-term leases Lease payments for which the underlying asset is of low value Total For the years ended December 31 2022 2021 1,469 1,316 2,785 1,598 1,488 3,086 Variable lease payments that were not included in the measurement of lease liabilities for the years ended December 31, 2022 were 5,470 million Won. (3) The Group uses a practical expedient that does not assess whether it is a lease change to the rend discount incurred directly as a result of COVID-19. Accordingly, the amount recognized in profit or loss during the reporting period is 15,880 million Won, to reflect changes in lease payments arising from the rent concession. - 194 - WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2022 AND 2021 44. BUSINESS COMBINATION The Group acquired 2,193,552,006 shares, equivalent to 82.03% of the total issued shares of PT Batavia Prosperindo Finance Tbk, an Indonesian listed company, of 2,673,995,362 shares on August 31, 2022 as the acquisition date for the purpose of entering the local financial industry in Indonesia , and changed its name to PT Woori Finance Indonesia Tbk. 1) As of the acquisition date, the transfer price, acquisition assets, liabilities, and non-controlling interests related to the business combination are as follows (Unit: Korean Won in millions): Fair value of transfer price Cash Amount recognized as assets and liabilities Cash and cash equivalents Financial assets at amortized cost Other assets Borrowings Other liabilities Amount 130,424 5,607 95,587 24,096 25,932 10,150 89,208 16,454 57,670 Fair value of identifiable net assets Non-controlling interests (*1) Goodwill (*1) Represents amount of a proportionate interest of the fair value of indentifiable net assets. 2) Assuming that the acquisition date of PT Woori Finance Indonesia Tbk by the Group is the commencement date of the financial statements, the consolidated income and consolidated net income are KRW 1,856,941 million and KRW 207,495 million, respectively. 45. EVENTS AFTER THE REPORTING PERIOD On February 27, 2023, the Group signed a stock sale contract to acquire a 52% stake in Daol Investment Co., Ltd. and will be included into a subsidiary in March 2023. - 195 - 

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