Woori Financial (WF) - 2024 Q4 - Annual Report

Financial Performance and Ratios - As of December 31, 2024, the total amount of assets provided as collateral for secured borrowings was ₩24,133 billion[80]. - The common equity Tier I capital adequacy ratio was 12.13%, exceeding the minimum requirement of 9.0%[88]. - The capital adequacy ratios for Woori Bank were 13.05% for common equity Tier I, 13.91% for Tier I, and 15.85% for combined Tier I and Tier II, all exceeding regulatory requirements[88]. - Approximately 95.1% of customer deposits had maturities of one year or less or were payable on demand as of December 31, 2024[85]. - The total book value of debt securities held in the trading and investment securities portfolio was ₩12,215 billion as of December 31, 2024[87]. Loan Performance and Risks - Non-performing loans to overseas borrowers increased from ₩304 billion as of December 31, 2023, to ₩447 billion as of December 31, 2024[83]. - Labor union unrest may disrupt operations and hinder future organizational changes and acquisitions[86]. - The company faces risks from potential legal claims and regulatory actions, which could expose it to monetary damages and reputational harm[106]. - The company is subject to evolving cybersecurity risks, with significant reliance on information technology systems for daily operations[105]. - The company may experience customer attrition or decreased net interest margins due to competitive strategies and government regulations affecting interest rates[113]. Government Regulations and Economic Environment - The Bank of Korea raised its policy rate to 3.50% from April 2022 through January 2023, then lowered it to 2.75% in February 2025[82]. - The Financial Consumer Protection Act, effective March 25, 2021, imposes stricter distribution guidelines and increased liability for customer losses, potentially increasing compliance costs for the company[112]. - The net interest spreads for Korean banks, including the company, have increased significantly due to rising interest rates, but may face pressure from new government regulations aimed at reducing these spreads[114]. - The Korean government announced a financial support program in December 2023, providing approximately ₩2 trillion in liquidity support to small business owners[117]. - The company faces risks from unfavorable economic developments in Korea, including potential declines in consumer confidence and spending due to rising interest rates[122]. International Operations and Sanctions - In 2024, the company generated total fee revenue of ₩340,000 from humanitarian trade activities involving the Central Bank of Iran (CBI), with net income before tax also amounting to ₩340,000[95]. - The company reported total fee revenue of ₩170,000 from telegraphic transfer services related to trade transactions with Iranian parties, with net income before tax also estimated at ₩170,000[95]. - The company maintains a limited number of deposit accounts for an Iranian financial institution subject to OFAC sanctions, which generated no fee revenues in 2024[95]. - The company has taken actions to negotiate repayment terms in Rubles to comply with sanctions, and has prepared response plans for potential additional sanctions against Russia[100]. - The company has been cooperating with an investigation regarding compliance with U.S. sanctions, which concluded with a cautionary letter from OFAC in December 2020[99]. Shareholder and Market Information - Major shareholders, including IMM Private Equity, sold an aggregate of 40,560,000 shares of common stock in block transactions between March 2024 and January 2025[130]. - The Korean government may impose restrictions on converting and remitting dividends in U.S. dollars during emergency circumstances, affecting shareholder returns[144]. - Ownership of common stock is restricted under Korean law, with a limit of 10.0% for single shareholders and 4.0% for non-financial business group companies[134]. - Non-Korean holders may face capital gains tax of up to 22.0% on realized gains if certain conditions are met, impacting investment returns[132]. - The KRX KOSPI Market, where the common stock is listed, is more volatile than U.S. markets, which may affect the market value of the stock[141]. Corporate Structure and Acquisitions - Woori Finance Holdings was established as a new financial holding company on January 11, 2019, through a comprehensive stock transfer, with shareholders receiving one share of the new company for each share of Woori Bank[166]. - In December 2014, the KDIC sold 40,143,022 shares of Woori Bank's common stock, representing 5.9% of its outstanding common stock, as part of the privatization plan[164]. - In June 2013, the Korean government announced a plan to privatize Woori Finance Holdings and its subsidiaries, which included the segregation of entities into three groups[157]. - Woori Finance Holdings merged with Woori Bank in November 2014, with Woori Bank remaining as the surviving entity[161]. - In August 2019, Woori Financial Group acquired a 73% equity interest in Woori Asset Management Corp., which became a consolidated subsidiary[174].