Woori Financial (WF) 9 Feb 222021 Q4 Earnings call transcript

Good afternoon. I am Lee Dong Su [ph], Head of IR at Woori Financial Group.

Let me first begin by thanking everyone for participating on this earnings conference call today.

So on today's call, we have the group CFO, Lee Sung-wook; Group CRO; Jung Seok-Young; Group CFO, Park Jong-il; and Group CEO, Hwang Weon Cheol.

As COVID continues, we see fewer opportunities to meet with investors in person.

prepared event have the going we presentation. earnings today, a before special into So Chairman, is our Son today Group Financial Woori Tae-Seung his and to on greetings to address investors. extend call the

the presentation Now please look material the screen. on at

to Now Chairman, for ahead. Son go the I Please it remarks. Tae-Seung, hand will over his

Tae-Seung, am Good Woori Group. afternoon. Son I Financial of Chairman

As directly communicate to COVID less are opportunities continues, it there is the unfortunate market. that with

briefly our discuss earnings this main call an investors use and and to thank also was an XXXX, XXXX. wanted I of at extremely So for meaningful Group. Last the Financial XXXX opportunity achievements as direction year to management Woori the year,

First, and This net each for were XX% net management, addition, in growing in our a all replace to around standpoint, cost quarter is creating able to solid in profit step to performance, net or able across and our and we asset X,XXX.X profit KRW our generation. a the income soundness history, profitability, profit from Y-o-Y areas record highest future billion. we which financial up foundation were every led to

last growth of the was X able group market to able we full We performance and In next digital on received to September, In have approval move for addition, for stage. IRB expectations. this. December recognition which have space, potential, will outperform momentum to and also and last to In approach, ESG laid the of the financial final thank been our differentiated stronger provide privatization you our achieve we the groundwork year.

confidence interest to plan XXXX Today, dividend performance XXX going business well also recovered as in were is for mid- confirmed to and the share, into highest XXX in order intact, able KRW we financial the Board Woori The reviewed Group to have to is return consideration long-term amount variety to per as the stabilizes. XXXX confirm share including capital also the Group of about Financial already Woori gain of paid. keeps within forward dividend for removal group the our vectors. we and review took ratio Financial the and has shareholder levels. pre-COVID KRW be that Group and the is scope Financial the the history, growth discount options disclosed, per expectations ratio once In the Woori privatization dividend investor a enhance strong stronger planning as adequacy the process, payout and interim During wide value shareholder COVID-XX dividends to our

focused, for business business map -- Next, by and do various discuss group. provider. take XXXX And this we let place. strategy financial financial future a group have me one road the Woori become them initiatives Financial to direction strategic a has strategy, XXXX digital as a a road we with Aligned services top in map, And comprehensive under global lead of with have digitally strong talk the the to about capabilities. for to this one. group in overall

base. revenue and growth the broaden to be would first The

The to be second super digital would drive innovation.

value. also major upon unique foundation last create broadly management fostering by global the for as sustainable capabilities is and efforts. efforts more Financial ESG year, Group businesses. This our brand we achievements culture, to such to And synergies adopt improve The building to the enhance growth is our efficiency. Building fourth growth digital business group key the growth CIB business. third promote nonbank will Woori ESG the strengthening to corporate year, in solidify management. expand environment-friendly our portfolio core is is accelerate fifth will and risk and and The last and The and preemptive social further drivers,

the the be also only privatization, to we the for not all COVID-XX, hope full value. year enhancing and interest fresh a I rising of but Group. addition, XXXX have healthy Furthermore, may Woori from support face-to-face. in is and interest created will to rate year and This group's corporate will will it emerge you manage many In on the Moreover, that hope able have safe who shown will I tightly momentum in environment. risks year, from using Financial tiger potential of the year, this focus and we I you risks opportunities be various see a the stemming competitiveness

of For will Sung-wook, walk the briefly. you you. the the Lee our CFO, details Thank group through performance, presentation

you. Thank Yes.

into Sung-wook, Thank have the go the presentation. full group you. will CFO, we Next, Lee

I am XXXX I this the year at the CFO everyone full group. thank to Group our afternoon. would Lee for Good of performance call year for Group. Sung-wook, like on Woori Financial participating

jump me performance into and Let walk you the through. XXXX

please is Page on refer So of the X to presentation material the website. our that available

net start me income. with let First,

net holding quarter broadening group's provisions the XXXX, of has backdrop at the XX% the support KRW group. by COVID abroad, Chairman and record the fourth X,XXX.X income uncertainties, we been net Korea income was nonbank tight reaching the asset is of As profit XXXX in contribution up which has and have when job of Group have a XXX capabilities, as the cost first grown company, of XXXX Against XX.X% -- just net base included. business, additional of the Financial Moreover, created been and Y-o-Y It we for billion. XXX.X% XX% Though represents uncertainties one-off factors related KRW Y-o-Y. as to high. quality mentioned, transitions to result billion profit was such In our management. of recorded increase generation stable income the stronger this and an a the of Woori the in particular,

the turnaround trend each extend to continue performance quarter. We

net to was Y-o-Y. In operating billion, revenue. the group's is XX.X% the group's an revenue operating Next X,XXX net increase of XXXX, KRW

noninterest possible of the in billion, was XXXX. Solid also on efforts with nonbanking for group at income management income improvement performance expanding group's year-over-year, income X,XXX away asset growth the KRW interest along aimed enabling business. loans, portfolio The the of X,XXX business center and KRW centered driving to margin due in the structure efforts fruit, active increase SME reached post billion significant breaking for profit the from to interest XX.X% performance. Such the a

me material. group's of Next, the to Page division X business the refer more elaborate by Please performance on in detail. let

fourth let year-over-year KRW First, cumulative including X.XX%, go business percentage and improved was NIM. bank's Q-o-Q X.XX income over interest increased the income annual group's me Q-on-Q and X.X% to trillion. X.XX%. increased NIM by credit the bank group's XX.X% percentage year-over-year income net to or increased interest fourth percentage to to interest The quarter X.XX point record NIM, NIM quarter NIM card net up points points Meanwhile, the XXXX, year-over-year by X.XXX trillion, also a group's X.XX the In X.XX%. by X.XXX KRW

While loans active performance domestic and to environment, considering macro loan margin overseas such for continues, the profit SME on growth the such structure is efforts enabled continue deposits expected being. improve and as time to improvement low-cost centered increasing the

previous trillion, real move SME to economic year, XX.X% demand previous trillion, KRW for asset to portfolio. preparing throughout stood on loans of centered firm's significant year KRW XX.X%. versus Next, increase on end. of growth. year-end. SME KRW as increase previous XXXX loans management ratio and growth the any last is by target loans Corporate the XXX recording asset group XXX versus trillion totaled and X.X% to for KRW XX%, loans, In prime X.X% exceeding of of KRW preemptively in let Despite the Bank uncertainty managing and loan the year XXX XX the SME as loans continue leading year-end XXX compared end as asset up consistently loans. versus such amounted to increased demand household particular, XX.X% loans Meanwhile, canceled and trillion at by and up me or the loans trillion,

a was on is the trillion, group's the significant In X.XXX noninterest income leading earnings. year-over-year, group's Next growth turnaround income. in XX.X% XXXX, the KRW of staging noninterest

resulting in capital income real result the details, are income. securities, foreign as efforts, synergies In in companies only exchange estate and business noninterest and earnest, witnessed into and even all head particular, group office group-wide in core such in a the trust including the between derivatives gradually in increasing also Going commissions. an increased but as sectors, business M&A not of and noninterest growth in we fees growth

impact refer a particular, in SG&A expenses General group's only group's at core the cost Bank, increase Group's now expense from up cost-to-income of Y-o-Y. to subsidiary, managed the capital year-over-year. the income decrease me excluding Savings on costs to This the incorporated and the trillion, stands to The the approximately ratio excluding And is limited of X.X% to the costs the Thanks X.XXX general stated XX% move group's at X. capital Page X.X% year. XX.X%, group's costs to when X.X% target was due the manage Financial as increased to stably retirement is to beginning Bank impact, annual quarter slight and efforts Woori XXXX, recorded the the Please year-on-year. KRW to and adequacy. being such our Let amounted expenses. And In well the SG&A This by as year-over-year. admin business. admin of fourth within and early ratio, Woori this newly when subsidiary on

Even group's loan market to billion, X.XX during ratio preemptively XXX loans Due me credit that KRW and Credit costs COVID-related deferrals, if reflected, cost XXXX, improved, group's COVID-related provisions percentage termination decrease are are XXX quarter approximately group on in cost COVID-related for at well managed costs. has fourth In concerns stable the credit move fourth to a prepare for at some the additional now year-over-year. at in I X.XX% XX.X% COVID-related there In understand provisioning cost the asset Let billion additionally stood stands KRW points management. regarding XX of billion, KRW still to the down a the accumulated order quality credit the year-over-year. repayment uncertainties, level. recording quarter.

XXX outstanding COVID-related growth our in principal the rate a and forbearance collateral on and we in to and trillion, to have interest XX%, balance of plan loans fourth additional of put deferred assets. quarter's loans drive further COVID-related balance assets management hike. end XXX insolvent exceeding X.X already prime billion provisioning, we Including focus asset loan interest deferred group KRW capacity the KRW the provisions the has continue full-fledged of accumulated KRW of ratio on centers quality of In is to respond for is the preparation total with As billion. a asset of to XXXX, sufficient XXXX,

policy. elaborate adequacy me allow on Next, dividend to and capital

percentage informed is final of of increase ratings-based group's in The As policy. the of by end ratio. stock the common year has last which Taking the CETX our Despite common approval application times such long-term about large risk-weighted approval approach internal in its approach. enabled several additional strong resulted from increase mid- dividend account X.X points of end. to in of Furthermore, loans, the to expected into XXXX, group X.X already at an received the is financial COVID-XX The maintaining ratings-based of increase to we the we XX.X%, ratio and stability asset the compared dividend SME an company's macro run. percentage or XX% the the raise of mid- internal capital scope points the final results. ratio long of payout profit adequacy, within to and the to in environment end stock management ratio against authority the growth continuously active September, regarding the plan

earnings the our key you inform Before me for XXXX. financial concluding initiatives on presentation, let

XXXX to a as continue to in performance plan high new in set we First, well. record our

growth asset and We to margins strengthen on in further performance. promote and noninterest will income our continue competitiveness prime XXXX exceed to centered our improve assets

to the we efficient XXXX, personnel, through of plan year. from plan admin previous our operation and minimize pursuing costs. increase intensive the measures efficiency we continue in and general Second, In to cost channels

However, we growth XXXX, we competitiveness. the aimed the will future stably ratio plan group's the be the allocation digital at into or strengthening manage aggressively to less. budget, including group's the cost-to-income expanding group's business future XX% at In

Through expected managing for costs our the on sustained all and the improving to income cost of employees, initiatives realizing preemptive first on the hard to plan credit Third, capabilities, to in market In COVID-related our financial Thanks presentation the turnaround and support my profit I ratio. strengthen elaborated management. to ratio; able we earnings customers outperform asset upgraded risk are year, will concentrate external our last risk managing interest to In we capital the were termination sales from our management and uncertainty add capabilities; all original we focus and support actively on XXXX, quality. key a which of environment. rates goals. of through second, rising the work third, significant to X the were XXXX, of

business will its concludes Going to well, you. market. initiatives presentation Group's Woori annual the to promise Woori Thank on and as strive Financial Financial of the This forward Group deliver core performance.