Business Context and Reporting Period
This Form 6-K filing by Woori Financial Group Inc. covers the first quarter of 2019 (ended March 31, 2019). The filing reports on the group's operations following its establishment on January 11, 2019, via a comprehensive stock transfer of Woori Bank and five other subsidiaries. Financial data is prepared in accordance with Korean IFRS (K-IFRS).
Key Financial Metrics
| Metric | Value (1Q 2019) | Unit |
|---|---|---|
| Operating Income | 833,999 | Millions KRW |
| Net Income | 614,529 | Millions KRW |
| Net Income Attributable to Owners | 568,689 | Millions KRW |
| Net Interest Income | 1,454,591 | Millions KRW |
| Total Assets | 345,148,958 | Millions KRW |
| Total Liabilities | 322,947,111 | Millions KRW |
| Total Equity | 22,201,847 | Millions KRW |
| Loans and Other Financial Assets | 287,710,941 | Millions KRW |
| Deposits Due to Customers | 250,143,465 | Millions KRW |
| Group BIS Capital Adequacy Ratio | 11.06 | % |
| Return on Assets (ROA) | 0.67 | % (Annualized) |
| Return on Equity (ROE) | 12.40 | % (Annualized) |
| Non-Performing Loan (NPL) Ratio | 0.48 | % |
Material Changes and Comparisons
- Establishment Impact: As the group was established on January 11, 2019, there are no comparable consolidated financial results for the prior period (2018) at the holding company level. The 2018 figures in the income statement represent the legacy Woori Bank data prior to the transfer.
- Income Growth: Operating income increased to 833.999 billion KRW in 1Q 2019 compared to 821.297 billion KRW in the comparable 2018 period. Net income rose to 614.529 billion KRW from 594.520 billion KRW.
- Asset Quality Improvement: Impairment losses due to credit loss decreased significantly to 60.007 billion KRW in 1Q 2019, down from 122.235 billion KRW in the comparable 2018 period.
- Capital Structure: The group issued 680,164,306 common shares upon establishment. The Korea Deposit Insurance Corporation (KDIC) holds 18.32% of shares as the largest shareholder.
Outlook, Risks, and Management Commentary
- Liquidity Position: The group maintains strong liquidity. The Won Liquidity Ratio for the group was 182.7%. Woori Bank's Liquidity Coverage Ratio (LCR) stood at 108.12%, exceeding regulatory requirements.
- Capital Adequacy: The Group BIS Capital Adequacy Ratio is 11.06%. Subsidiary ratios remain robust: Woori Bank (15.32%), Woori Card (18.48% adjusted capital ratio), and Woori Investment Bank (13.33%).
- Accounting Standards: The filing notes that K-IFRS 1116 has been applied to the 2019 1Q statements but not retroactively to the 2018 comparative figures, which may affect direct comparability of certain line items.
- Market Performance: Common shares began trading on the KRX KOSPI Market on February 13, 2019. ADSs trade on the NYSE. Stock prices ranged from a high of 16,000 KRW to a low of 13,350 KRW in March 2019.
Investor Verification Checklist
- Consolidation Scope: Verify the impact of the comprehensive stock transfer on the consolidation of 78 subsidiaries compared to the previous 65.
- Accounting Adjustments: Review the specific impacts of K-IFRS 1116 application on the 2019 1Q financials versus the non-retroactive 2018 data.
- Subsidiary Performance: Analyze the individual performance of key subsidiaries (Woori Bank, Woori Card, Woori Investment Bank) as the holding company itself reported a net loss of 14.641 billion KRW on a separate basis.
- Regulatory Compliance: Confirm that preliminary capital adequacy ratios (noted as subject to change) meet all regulatory thresholds for the upcoming quarters.
- Dividend Policy: Note that no dividends have been declared for the period up to 1Q 2019 due to the recent establishment of the group.