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Business Context and Reporting Period

This Form 6-K filing by Woori Finance Holdings Co., Ltd. (Woori Financial Group) covers the fiscal year ended December 31, 2010, and was filed in March 2011. The registrant is a financial holding company whose primary income source consists of dividends from its subsidiaries, which include Woori Bank, Woori Investment & Securities, Woori Aviva Life Insurance, and various other financial service entities. The group operates under the Financial Holding Company Act of Korea.

Key Financial Metrics (Fiscal Year 2010)

Financial data is presented in millions of Won unless otherwise noted. The filing provides both non-consolidated (holding company only) and consolidated figures.

Key Ratios:

• BIS Ratio: 12.53% (up from 12.35% in 2009).
• Net Interest Margin: 2.31% (up from 1.99% in 2009).
• Debt Ratio (Liabilities/Equity): 26.56% (down from 27.87% in 2009).
• Non-Performing Loans: Loans classified as sub-standard or below were 3.3% of total loans (up from 1.7% in 2009).

Material Changes vs. Prior Period

• Profitability: Consolidated net income for majority shareholders increased to 1.19 trillion Won in 2010 from 1.03 trillion Won in 2009. Operating revenue decreased significantly to 34.7 trillion Won from 54.1 trillion Won in 2009, likely due to accounting adjustments or changes in trading income recognition, though operating income increased to 1.84 trillion Won from 1.38 trillion Won.
• Asset Quality: The ratio of loans classified as sub-standard or below rose to 3.3% from 1.7% in 2009. The 20 largest sub-standard exposures totaled 3.09 trillion Won, with significant exposure in the construction and real estate sectors.
• Capital Structure: Shareholders' equity grew to 14.54 trillion Won (non-consolidated) from 13.72 trillion Won. The company maintained a strong liquidity position with a current ratio of 707.31%.
• Dividends: Cash dividends per share increased to 250 Won from 100 Won in 2009.

Outlook, Risks, and Recent Developments

Recent Developments: On February 18, 2011, Woori Finance Holdings was selected as the preferred bidder to acquire the assets and assume the liabilities of Samhwa Mutual Savings Bank. A memorandum of understanding was signed with the Korea Deposit Insurance Corporation (KDIC) on March 11, 2011. A new subsidiary, Woori Financial Group Savings Bank Co., Ltd., was established to effect this purchase and began operations on March 25, 2011.

Risks and Contingencies:

• Credit Risk: The increase in sub-standard loans (3.3%) indicates rising credit risk, particularly in construction and real estate sectors.
• Accounting Standards: Financial information is prepared under Korean GAAP, which differs in certain respects from US GAAP.
• Concentration Risk: The 30 largest borrower exposures totaled 25.16 trillion Won, with significant exposure to major industrial groups (e.g., Samsung, Hyundai, STX) and government-related entities.

Management Commentary: The filing does not contain explicit forward-looking guidance or management commentary regarding future earnings projections beyond the recent acquisition announcement.

Investor Verification Checklist

• Acquisition Details: Verify the final terms, regulatory approval status, and integration costs associated with the acquisition of Samhwa Mutual Savings Bank.
• Asset Quality Trends: Investigate the drivers behind the doubling of the sub-standard loan ratio (1.7% to 3.3%) and the adequacy of loan loss reserves (9.75 trillion Won for top 20 exposures).
• Revenue Volatility: Analyze the significant drop in consolidated operating revenue (from 54.1T to 34.7T Won) while operating income increased, to understand the composition of income (e.g., trading gains vs. interest income).
• Major Shareholder Influence: Note that the Korea Deposit Insurance Corporation (KDIC) holds 56.97% of the company's shares, representing a controlling interest.
• Accounting Differences: Review the specific differences between Korean GAAP and US GAAP as noted in the filing to ensure accurate cross-border financial analysis.