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- **Revenue Growth**: Q3 net income up 5.1% YoY, fee income at record high of KRW 563.7 billion Q3. Noninterest income growth 5.3% QoQ, supported by insurance acquisition contributions.

**【CFO Financial Commentary】**
- Q3 net income rose 5.1% Y-o-Y, driven by asset rebalancing and noninterest income growth of 4.6% YoY, with fee income at a record high of KRW 563.7 billion Q3. Noninterest income growth of 5.3% QoQ, supported by insurance acquisition contributions.

**【Q&A Highlights】**
- **Insurance Integration**: Group reviewing Tongyang Life and ABL Life integration options, with 22.5% QoQ growth in Bancassurance channel contributions.
- **Capital Management**: CET1 ratio improved to 12.92% QoQ, targeting 13% by 2026.
- **Risk Management**: Credit cost ratio 0.42%, with proactive provisioning for completion-guarantee projects resolved at KRW 98 billion Q3.

Woori Financial Group Inc. (WF) Q3 2025 Earnings Call Transcript

- **CET1 Ratio Exceeds Target**: CET1 ratio of 12.76% surpasses 12.5% target, with plans to reach 13% by year-end.
- **Insurance Acquisition Impact**: Completed Tongyang and ABL Life integration; PPA results pending but no immediate capital increase needed.
- **NIM Stability**: Q2 NIM at 1.45% (bank) and 1.71% (group), maintained through asset rebalancing.
- **Dividend Policy**: Quarterly dividend of KRW 200 per share approved, aligning with 50% payout policy.
- **MTS Expansion**: Woori Investment Securities to launch overseas stock trading and AI-driven investment tools in 2025.

**【Management Opening Remarks】**
- Hong Sung Han, Head of IR, welcomed participants and introduced the CFO, Sung-Wook Lee, who would present the financial results. The call included simultaneous interpretation for overseas investors.

**【CFO Financial Commentary】**
- **Net Income**: First-half 2025 net income was KRW 1,551.3 billion, down 11.6% Y-o-Y, due to one-off expenses (early retirement program and trust provisions). Excluding these, net income was stable.
- **Capital Adequacy**: CET1 ratio reached 12.76% as of June 2025, up 60 bps Y-o-Y, exceeding the 12.5% target. The group aims to achieve 13% by year-end through asset rebalancing and risk-weighted asset management.
- **Business Expansion**: Completed acquisition of Tongyang Life and ABL Life in July 2025, with ongoing purchase price allocation (PPA) to assess financial impact. Focus on sound capital management and synergies across the group.
- **Operating Revenue**: First-half operating revenue grew 2.3% Y-o-Y to KRW 5,400.1 billion, driven by core fee income in Wealth Management and noninterest income from capital market activities.
- **Net Interest Margin (NIM)**: Bank NIM was 1.45% in Q2, up 1 bps Q-o-Q, reflecting asset rebalancing and funding cost management. Group NIM (including credit card) was 1.71%, up 1 bps Q-o-Q.
- **Loan Portfolio**: Bank loans totaled KRW 329 trillion, with retail loans up KRW 3.7 trillion Q-o-Q. Focus on SME lending and household debt management per government policy.
- **Noninterest Income**: First-half noninterest income was KRW 886.3 billion, stable Y-o-Y, with Q2 up 47% Q-o-Q due to Wealth Management fee growth and market-related gains.
- **Expenses**: SG&A rose 18% Y-o-Y to KRW 2,479.1 billion, driven by one-off costs (early retirements, IT investments). Cost-to-income ratio was 42.8%.
- **Credit Costs**: First-half credit costs were KRW 944.5 billion, up 16.9% Q-o-Q due to preemptive provisions. Excluding one-off items, credit cost ratio was 0.42%.
- **Capital Return**: Approved quarterly dividend of KRW 200 per share (record date August 10), aligning with 50% payout policy.

**【Q&A Highlights】**
- **Insurance Strategy**: No decision on merging Tongyang and ABL; focusing on business assessment and K-ICS ratio improvement. PPA results to be disclosed in Q3.
- **Capital Ratio Target**: CET1 ratio to exceed 12.5% for 2025, with potential 13% achievement by year-end. No immediate capital increase needed for insurers.
- **MTS Service**: Woori Investment Securities launched MTS in March, opening 20 new accounts. Plans to expand overseas stock trading and AI-driven investment tools.
- **Stable Coins**: Monitoring digital asset framework; potential joint stable coin issuance with OBDIA, pending regulatory clarity.
- **Credit Cost Guidance**: Full-year CCR expected at low to mid-40s basis points, stable after Q2 one-off provisions.
- **Share Buyback**: 2025 share cancellation of KRW 150 billion scheduled for September, with future buybacks contingent on financial conditions.

Woori Financial Group Inc. (WF) Q2 2025 Earnings Call Transcript

- **Core Earnings Resilience**: Despite one-off costs, ROE at 9.5% and CET1 ratio up 30bps to 12.42%.
- **Digital Growth Momentum**: Super App MAU targets 9M, life insurance acquisition to add KRW 300-400B annual profit.
- **Risk Management Excellence**: Normalized credit cost ratio at 0.39%, real estate PF exposure capped at 0.5% of loans.
- **Tariff Mitigation Strategy**: Proactive portfolio rebalancing and customer support to minimize trade dispute impact.

**【CFO Performance Overview】**
- Q1 2025 Net Income: KRW 615.6 billion (YoY -18.8% due to one-off costs). Core ROE: 9.5%.
- Net Operating Revenue: KRW 2,609.5 billion (YoY +2.4%, QoQ +6.6%). Interest Income stable, Noninterest Income up 5%.
- Credit Cost: KRW 435.5 billion (YoY +18.8%), driven by economic uncertainty. Normalized credit cost ratio: 0.39%.
- CET1 Ratio: 12.42% (up 30bps YoY), targeting 12.5%+ by end-2025.
- Q1 Dividend: KRW 200/share (YoY +11%), with buyback program of KRW 150 billion.

**【Asset Management & Risk】**
- Loan Portfolio: KRW 330 trillion (slight QoQ decline). Focus on high-quality SMEs (183% growth), secured retail loans, and risk mitigation.
- NIM: 1.44% (QoQ +4bps), benefiting from BOK rate cuts and cost stabilization. Anticipate NIM stability amid rate cuts.
- Real Estate PF Exposure: KRW 3.3 trillion (0.5% of loans), with preemptive provisioning limiting impact.

**【Digital & Expansion Initiatives】**
- Super App MAU: 8.5 million (target 9M by end-2025). Securities MTS launched, integrating digital channels.
- Life Insurance Acquisition: Expected annual profit boost of KRW 300-400 billion, minimal CET1 impact.
- Budget Telecom Service: Targeting 20-30s demographic, bundled telecom/finance products for customer acquisition.

**【Macroeconomic Response】**
- U.S. Reciprocal Tariffs Task Force: Monitoring sector-specific impacts, restructuring portfolio to high-quality assets.
- Foreign Currency Management: Reducing FX-sensitive assets, maintaining liquidity buffers.
- Digital Investments: KRW 169 billion in Q1 for UN Banking, IT upgrades; targeting cost efficiency in 2025.

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