CONSOLIDATED INTERIM FINANCIAL STATEMENTS
AS OF AND FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED
JUNE 30, 2021 AND 2020
WOORI FINANCIAL GROUP INC.
Page(s) | ||||
Report on Review of Consolidated Interim Financial Statements | 1-2 | |||
Consolidated Interim Financial Statements | ||||
Consolidated Interim Statements of Financial Position | 4 | |||
Consolidated Interim Statements of Comprehensive Income | 5-6 | |||
Consolidated Interim Statements of Changes in Equity | 7 | |||
Consolidated Interim Statements of Cash Flows | 8-9 | |||
Notes to the Consolidated Interim Financial Statements | 10-125 |
Report on Review of Consolidated Interim Financial Statements
English Translation of a Report Originally Issued in Korean on August 13, 2021
To the Shareholders and the Board of Directors of Woori Financial Group Inc.
Reviewed Financial Statements
We have reviewed the accompanying consolidated interim financial statements of Woori Financial Group Inc. and its subsidiaries (collectively referred to as the 'Group'). These financial statements consist of the consolidated interim statement of financial position of the Group as at June 30, 2021 and the related consolidated interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2021 and 2020, and consolidated interim statements of changes in equity and cash flows for the six-month periods ended June 30, 2021 and 2020, and a summary of significant accounting policies and other explanatory notes, expressed in Korean Won.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated interim financial statements in accordance with International Financial Reporting Standards as adopted by the Republic of Korea ('Korean IFRS') 1034 Interim Financial Reporting, and for such internal control as management determines is necessary to enable the preparation of consolidated interim financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to issue a report on these consolidated interim financial statements based on our review.
We conducted our review in accordance with quarterly or semi-annual review standards established by the Securities and Futures Commission of the Republic of Korea. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Korean Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe the accompanying consolidated interim financial statements are not presented fairly, in all material respects, in accordance with Korean IFRS 1034 Interim Financial Reporting.
- 1 -
Emphasis of Matters
Without qualifying our conclusion, we draw attention to Note 3 of the consolidated financial statements, which indicates that the outbreak of COVID-19 may have a negative impact on the Group's financial condition and results of operations.
Other Matters
We have audited the consolidated statement of financial position of the Group as at December 31, 2020, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, in accordance with Korean Standards on Auditing. We expressed an unqualified opinion on those financial statements, not presented herein, in our audit report dated March 12, 2021. The consolidated statement of financial position as at December 31, 2020, presented herein for comparative purposes, is consistent, in all material respects, with the above audited consolidated statement of financial position as at December 31, 2020.
Review standards and their application in practice vary among countries. The procedures and practices used in the Republic of Korea to review such financial statements may differ from those generally accepted and applied in other countries.
/s/ Samil PricewaterhouseCoopers |
Seoul, Korea
August 13, 2021
Notice to Readers
This report is effective as of August 13, 2021, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying consolidated interim financial statements and notes thereto. Accordingly, the readers of the review report should understand that there is a possibility that the above review report may have to be revised to reflect the impact of such subsequent events or circumstances, if any.
- 2 -
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM FINANCIAL STATEMENTS
AS OF AND FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED
JUNE 30, 2021 AND 2020
The accompanying consolidated interim financial statements including
all footnote disclosures were prepared by, and are the responsibility of, the management of Woori Financial
Group Inc.
Tae Seung Son
President and Chief Executive Officer
Main Office Address: (Address) 51, Sogong-ro,Jung-gu, Seoul
(Phone Number) 02-2125-2000
- 3 -
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION
AS OF JUNE 30, 2021 (UNAUDITED) AND DECEMBER 31, 2020
June 30, 2021 |
December 31, 2020 | |||||||
(Korean Won in millions) | ||||||||
ASSETS | ||||||||
Cash and cash equivalents (Note 6) | 10,411,346 | 9,990,983 | ||||||
Financial assets at fair value through profit or loss ('FVTPL') (Notes 4, 7, 11, and 24) | 12,264,521 | 14,762,941 | ||||||
Financial assets at fair value through other comprehensive income ('FVTOCI') (Notes 4, 8, and 11) | 30,284,891 | 30,028,929 | ||||||
Securities at amortized cost (Notes 4, 9, and 11) | 15,725,241 | 17,020,839 | ||||||
Loans and other financial assets at amortized cost (Notes 4, 10, 11, and 39) | 345,150,425 | 320,106,078 | ||||||
Investments in joint ventures and associates (Note 12) | 1,175,274 | 993,291 | ||||||
Investment properties (Note 13) | 386,650 | 387,464 | ||||||
Premises and equipment (Notes 14) | 3,190,194 | 3,287,198 | ||||||
Intangible assets (Note 15) | 775,614 | 792,077 | ||||||
Assets held for sale (Note 16) | 35,495 | 60,002 | ||||||
Net defined benefit asset (Note 22) | 1,809 | 5,658 | ||||||
Current tax assets | 33,606 | 75,655 | ||||||
Deferred tax assets | 37,365 | 46,088 | ||||||
Derivative assets (Designated for hedging) (Notes 4, 11 and 24) | 129,562 | 174,820 | ||||||
Other assets (Notes 17 and 39) | 1,668,613 | 1,348,994 | ||||||
Total assets | 421,270,606 | 399,081,017 | ||||||
LIABILITIES | ||||||||
Financial liabilities at fair value through profit or loss ('FVTPL') (Notes 4, 11, 18 and 24) | 3,928,181 | 6,813,822 | ||||||
Deposits due to customers (Notes 4, 11, 19 and 39) | 302,492,676 | 291,477,279 | ||||||
Borrowings (Notes 4, 11 and 20) | 22,545,862 | 20,745,466 | ||||||
Debentures (Notes 4, 11 and 20) | 40,917,952 | 37,479,358 | ||||||
Provisions (Notes 21, 38 and 39) | 500,497 | 501,643 | ||||||
Net defined benefit liability (Note 22) | 57,736 | 52,237 | ||||||
Current tax liabilities | 333,409 | 370,718 | ||||||
Deferred tax liabilities | 268,786 | 160,250 | ||||||
Derivative liabilities (Designated for hedging) (Notes 4, 11 and 24) | 44,045 | 64,769 | ||||||
Other financial liabilities (Notes 4, 11, 23 and 39) | 21,549,754 | 14,215,817 | ||||||
Other liabilities (Notes 23 and 39) | 471,534 | 473,813 | ||||||
Total liabilities | 393,110,432 | 372,355,172 | ||||||
EQUITY | ||||||||
Owners' equity (Note 26) | ||||||||
Capital stock | 3,611,338 | 3,611,338 | ||||||
Hybrid securities | 2,094,818 | 1,895,366 | ||||||
Capital surplus | 631,368 | 626,111 | ||||||
Other equity | (2,176,729 | ) | (2,347,472 | ) | ||||
Retained earnings | 20,398,356 | 19,268,265 | ||||||
24,559,151 | 23,053,608 | |||||||
Non-controlling interests | 3,601,023 | 3,672,237 | ||||||
Total equity | 28,160,174 | 26,725,845 | ||||||
Total liabilities and equity | 421,270,606 | 399,081,017 | ||||||
The accompanying notes are part of this consolidated interim financial statement.
- 4 -
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2021 AND 2020 (UNAUDITED)
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
(Korean Won in millions, except per share data) | ||||||||||||||||
Interest income | 2,383,286 | 4,710,471 | 2,412,189 | 4,916,003 | ||||||||||||
Financial assets at FVTPL | 11,046 | 22,420 | 13,681 | 26,210 | ||||||||||||
Financial assets at FVTOCI | 83,821 | 175,607 | 114,823 | 241,000 | ||||||||||||
Financial assets at amortized cost | 2,288,419 | 4,512,444 | 2,283,685 | 4,648,793 | ||||||||||||
Interest expense | (680,333 | ) | (1,387,852 | ) | (934,299 | ) | (1,975,154 | ) | ||||||||
Net interest income (Notes 11, 28 and 39) | 1,702,953 | 3,322,619 | 1,477,890 | 2,940,849 | ||||||||||||
Fees and commissions income | 547,051 | 1,065,916 | 397,282 | 807,993 | ||||||||||||
Fees and commissions expense | (176,058 | ) | (336,462 | ) | (172,913 | ) | (309,644 | ) | ||||||||
Net fees and commissions income (Notes 11, 29 and 39) | 370,993 | 729,454 | 224,369 | 498,349 | ||||||||||||
Dividend income (Notes 11, 30 and 39) | 64,148 | 130,738 | 23,233 | 71,002 | ||||||||||||
Net gain(loss) on financial instruments at FVTPL (Notes 11, 31 and 39) | 54,324 | 136,407 | (66,486 | ) | 401,589 | |||||||||||
Net gain on financial assets at FVTOCI (Notes 11 and 32) | 8,048 | 45,059 | 8,427 | 11,027 | ||||||||||||
Net gain arising on financial assets at amortized cost (Note 11) | 4,004 | 38,680 | 5,915 | 32,662 | ||||||||||||
Impairment losses due to credit loss (Notes 33 and 39) | (68,583 | ) | (204,576 | ) | (335,787 | ) | (446,679 | ) | ||||||||
General and administrative expense (Notes 34 and 39) | (937,886 | ) | (1,855,493 | ) | (897,032 | ) | (1,789,558 | ) | ||||||||
Other net operating expense (Notes 11, 24, 34 and 39) | (147,673 | ) | (359,048 | ) | (41,269 | ) | (546,643 | ) | ||||||||
Operating income | 1,050,328 | 1,983,840 | 399,260 | 1,172,598 | ||||||||||||
Share of gain of joint ventures and associates (Note 12) | 31,832 | 26,241 | 16,798 | 23,952 | ||||||||||||
Other non-operating income(expense) | (6,174 | ) | 7,667 | (134,822 | ) | (162,701 | ) | |||||||||
Non-operating income(expense) (Note 35) | 25,658 | 33,908 | (118,024 | ) | (138,749 | ) | ||||||||||
Net income before income tax expense | 1,075,986 | 2,017,748 | 281,236 | 1,033,849 | ||||||||||||
Income tax expense (Note 36) | (257,602 | ) | (480,497 | ) | (64,974 | ) | (259,816 | ) | ||||||||
Net income | 818,384 | 1,537,251 | 216,262 | 774,033 | ||||||||||||
Net gain(loss) on valuation of equity securities at FVTOCI | 146,935 | 172,101 | 14,957 | (95,214 | ) | |||||||||||
Changes in capital due to equity method | (312 | ) | (23 | ) | - | - | ||||||||||
Remeasurement loss related to defined benefit plan | 20,908 | 13,604 | (6,911 | ) | (26,240 | ) | ||||||||||
Items that will not be reclassified to profit or loss | 167,531 | 185,682 | 8,046 | (121,454 | ) | |||||||||||
Net gain(loss) on valuation of debt securities at FVTOCI | (72,540 | ) | (126,353 | ) | 45,464 | 69,463 | ||||||||||
Changes in capital due to equity method | 604 | 1,899 | (3,614 | ) | (4,621 | ) | ||||||||||
Net gain on foreign currency translation of foreign operations | 5,294 | 86,261 | 43,478 | 57,475 | ||||||||||||
Net gain(loss) on valuation of cash flow hedge | 4,052 | 4,046 | (545 | ) | (10,030 | ) | ||||||||||
Items that may be reclassified to profit or loss | (62,590 | ) | (34,147 | ) | 84,783 | 112,287 | ||||||||||
Other comprehensive income(loss), net of tax | 104,941 | 151,535 | 92,829 | (9,167 | ) | |||||||||||
Total comprehensive income | 923,325 | 1,688,786 | 309,091 | 764,866 | ||||||||||||
(Continued)
- 5 -
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2021AND 2020 (UNAUDITED) (CONTINUED)
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
(Korean Won in millions, except per share data) | ||||||||||||||||
Net income attributable to: | 818,384 | 1,537,251 | 216,262 | 774,033 | ||||||||||||
Net income attributable to owners | 752,595 | 1,419,698 | 142,348 | 660,564 | ||||||||||||
Net income attributable to non-controlling interests | 65,789 | 117,553 | 73,914 | 113,469 | ||||||||||||
Total comprehensive income attributable to: | 923,325 | 1,688,786 | 309,091 | 764,866 | ||||||||||||
Comprehensive income attributable to owners | 857,879 | 1,569,431 | 221,161 | 648,420 | ||||||||||||
Comprehensive income attributable to non-controlling interests | 65,446 | 119,355 | 87,930 | 116,446 | ||||||||||||
Earnings per share (Note 37) | ||||||||||||||||
Basic and diluted earnings per share (Unit: In Korean Won) | 1,020 | 1,922 | 181 | 887 |
The accompanying notes are part of this consolidated interim financial statement.
- 6 -
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY
FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2021 AND 2020 (UNAUDITED)
Capital Stock |
Hybrid securities |
Capital surplus |
Other equity |
Retained earnings |
Owners' equity in total |
Non-controlling interests |
Total equity | |||||||||||||||||||||||||
(Korean Won in millions) | ||||||||||||||||||||||||||||||||
January 1, 2020 | 3,611,338 | 997,544 | 626,295 | (2,249,322 | ) | 18,524,515 | 21,510,370 | 3,981,962 | 25,492,332 | |||||||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||||
Net income | - | - | - | - | 660,564 | 660,564 | 113,469 | 774,033 | ||||||||||||||||||||||||
Net loss on valuation of financial instruments at FVTOCI | - | - | - | (25,697 | ) | - | (25,697 | ) | (54 | ) | (25,751 | ) | ||||||||||||||||||||
Net gain(loss) due to disposal of equity securities at FVTOCI | - | - | - | 578 | (578 | ) | - | - | - | |||||||||||||||||||||||
Changes in capital due to equity method | - | - | - | (4,621 | ) | - | (4,621 | ) | - | (4,621 | ) | |||||||||||||||||||||
Gain on foreign currency translation of foreign operations | - | - | - | 54,445 | - | 54,445 | 3,030 | 57,475 | ||||||||||||||||||||||||
Loss on valuation of cash flow hedge | - | - | - | (10,030 | ) | - | (10,030 | ) | - | (10,030 | ) | |||||||||||||||||||||
Remeasurement gain(loss) related to defined benefit plan | - | - | - | (26,241 | ) | - | (26,241 | ) | 1 | (26,240 | ) | |||||||||||||||||||||
Transactions with owners and others | ||||||||||||||||||||||||||||||||
Dividends to common stocks | - | - | - | - | (505,587 | ) | (505,587 | ) | (2,054 | ) | (507,641 | ) | ||||||||||||||||||||
Issuance of hybrid securities | - | 698,277 | - | - | - | 698,277 | - | 698,277 | ||||||||||||||||||||||||
Dividends to hybrid securities | - | - | - | - | (20,365 | ) | (20,365 | ) | (90,091 | ) | (110,456 | ) | ||||||||||||||||||||
Redemption of hybrid securities | - | - | - | (31,252 | ) | - | (31,252 | ) | (555,744 | ) | (586,996 | ) | ||||||||||||||||||||
Changes in subsidiaries' capital | - | - | 1,330 | 6,350 | (6,350 | ) | 1,330 | (24 | ) | 1,306 | ||||||||||||||||||||||
June 30, 2020 (Unaudited) | 3,611,338 | 1,695,821 | 627,625 | (2,285,790 | ) | 18,652,199 | 22,301,193 | 3,450,495 | 25,751,688 | |||||||||||||||||||||||
January 1, 2021 | 3,611,338 | 1,895,366 | 626,111 | (2,347,472 | ) | 19,268,265 | 23,053,608 | 3,672,237 | 26,725,845 | |||||||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||||
Net income | - | - | - | - | 1,419,698 | 1,419,698 | 117,553 | 1,537,251 | ||||||||||||||||||||||||
Net gain on valuation of financial instruments at FVTOCI | - | - | - | 45,711 | - | 45,711 | 37 | 45,748 | ||||||||||||||||||||||||
Net gain(loss) due to disposal of equity securities at FVTOCI | - | - | - | (33,448 | ) | 33,448 | - | - | - | |||||||||||||||||||||||
Changes in capital due to equity method | - | - | - | 2,673 | (797 | ) | 1,876 | - | 1,876 | |||||||||||||||||||||||
Gain on foreign currency translation of foreign operations | - | - | - | 84,639 | - | 84,639 | 1,622 | 86,261 | ||||||||||||||||||||||||
Gain on valuation of cash flow hedge | - | - | - | 3,889 | - | 3,889 | 157 | 4,046 | ||||||||||||||||||||||||
Capital related to noncurrent assets held for sale | - | - | - | (560 | ) | 560 | - | - | - | |||||||||||||||||||||||
Remeasurement gain(loss) related to defined benefit plan | - | - | - | 13,618 | - | 13,618 | (14 | ) | 13,604 | |||||||||||||||||||||||
Transactions with owners and others | ||||||||||||||||||||||||||||||||
Dividends to common stocks | - | - | - | - | (260,016 | ) | (260,016 | ) | (9,374 | ) | (269,390 | ) | ||||||||||||||||||||
Issuance of hybrid securities | - | 199,452 | - | - | - | 199,452 | - | 199,452 | ||||||||||||||||||||||||
Dividends to hybrid securities | - | - | - | - | (31,550 | ) | (31,550 | ) | (71,537 | ) | (103,087 | ) | ||||||||||||||||||||
Changes in subsidiaries' capital | - | - | 25 | 31,233 | (31,252 | ) | 6 | (26 | ) | (20 | ) | |||||||||||||||||||||
Others | - | - | 5,232 | 22,988 | - | 28,220 | (109,632 | ) | (81,412 | ) | ||||||||||||||||||||||
June 30, 2021 (Unaudited) | 3,611,338 | 2,094,818 | 631,368 | (2,176,729 | ) | 20,398,356 | 24,559,151 | 3,601,023 | 28,160,174 | |||||||||||||||||||||||
The accompanying notes are part of this consolidated interim financial statement.
- 7 -
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2021 AND 2020 (UNAUDITED)
For the six-month periods ended June 30 | ||||||||
2021 | 2020 | |||||||
(Korean Won in millions) | ||||||||
Cash flows from operating activities: | ||||||||
Net income | 1,537,251 | 774,033 | ||||||
Adjustments to net income: | ||||||||
Income tax expense | 480,497 | 259,816 | ||||||
Interest income | (4,710,471 | ) | (4,916,003 | ) | ||||
Interest expense | 1,387,852 | 1,975,154 | ||||||
Dividend income | (130,738 | ) | (71,002 | ) | ||||
(2,972,860 | ) | (2,752,035 | ) | |||||
Additions of expenses not involving cash outflows: | ||||||||
Loss on valuation of financial instruments at FVTPL | 102,439 | - | ||||||
Loss on financial assets at FVTOCI | 242 | 344 | ||||||
Impairment loss due to credit loss | 204,576 | 446,679 | ||||||
Loss on other provisions | 14,651 | 169,349 | ||||||
Retirement benefit | 88,663 | 86,185 | ||||||
Depreciation and amortization | 385,003 | 266,837 | ||||||
Net loss on foreign currency translation | - | 339,687 | ||||||
Loss on derivatives (designated for hedge) | 53,359 | 9,324 | ||||||
Loss on fair value hedge | - | 108,090 | ||||||
Loss on investments in joint ventures and associates | 12,461 | 11,731 | ||||||
Loss on disposal of premises and equipment, intangible assets and other assets | 1,798 | 821 | ||||||
Impairment loss on premises and equipment, intangible assets and other assets | 639 | 8,254 | ||||||
863,831 | 1,447,301 | |||||||
Deductions of income not involving cash inflows: | ||||||||
Gain on valuation of financial instruments at FVTPL | - | 249,455 | ||||||
Gain on financial assets at FVTOCI | 45,301 | 11,371 | ||||||
Gain on other provisions | 648 | 124 | ||||||
Net gain on foreign currency translation | 4,742 | - | ||||||
Gain on derivatives (designated for hedge) | 26,477 | 132,356 | ||||||
Gain on fair value hedge | 61,262 | - | ||||||
Gain on investments in joint ventures and associates | 38,702 | 35,683 | ||||||
Gain on disposal of premises and equipment, intangible assets and other assets | 33,345 | 6,575 | ||||||
Reversal of impairment loss on premises and equipment, intangible assets and other assets | 96 | 55 | ||||||
Other income | 19,313 | 4,608 | ||||||
229,886 | 440,227 | |||||||
Changes in operating assets and liabilities: | ||||||||
Financial instruments at FVTPL | 176,818 | (167,347 | ) | |||||
Loans and other financial assets at amortized cost | (24,005,568 | ) | (12,171,466 | ) | ||||
Other assets | (425,861 | ) | (56,319 | ) | ||||
Deposits due to customers | 9,979,228 | 11,526,133 | ||||||
Provisions | (16,256 | ) | (90,706 | ) | ||||
Net defined benefit liability | (61,179 | ) | (67,202 | ) | ||||
Other financial liabilities | 7,264,990 | 1,929,411 | ||||||
Other liabilities | (7,136 | ) | (38,327 | ) | ||||
(7,094,964 | ) | 864,177 | ||||||
Interest income received | 4,637,247 | 5,052,912 | ||||||
Interest expense paid | (1,538,731 | ) | (2,268,755 | ) | ||||
Dividends received | 130,823 | 71,134 | ||||||
Income tax paid | (351,844 | ) | (236,188 | ) | ||||
Net cash inflow(outflow) from operating activities | (5,019,133 | ) | 2,512,352 | |||||
(Continued)
- 8 -
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2021 AND 2020 (UNAUDITED) (CONTINUED)
For the six-month periods ended June 30 | ||||||||
2021 | 2020 | |||||||
(Korean Won in millions) | ||||||||
Cash flows from investing activities: | ||||||||
Cash in-flows from investing activities: | ||||||||
Net increase in derivatives designated for hedging purpose | 479 | 499 | ||||||
Disposal of financial instruments at FVTPL | 6,219,265 | 3,485,089 | ||||||
Disposal of financial assets at FVTOCI | 13,521,839 | 11,062,888 | ||||||
Redemption of securities at amortized cost | 2,810,065 | 3,406,645 | ||||||
Disposal of investments in joint ventures and associates | 22,320 | 32,162 | ||||||
Disposal of investment properties | - | 354 | ||||||
Disposal of premises and equipment | 56,026 | 17,212 | ||||||
Disposal of intangible assets | 334 | 371 | ||||||
Net decrease of other assets | 50,652 | - | ||||||
22,680,980 | 18,005,220 | |||||||
Cash out-flows from investing activities: | ||||||||
Acquisition of financial instruments at FVTPL | 6,877,285 | 3,995,877 | ||||||
Acquisition of financial assets at FVTOCI | 13,506,169 | 12,883,464 | ||||||
Acquisition of securities at amortized cost | 1,496,443 | 1,678,871 | ||||||
Acquisition of investments in joint ventures and associates | 176,835 | 130,261 | ||||||
Acquisition of investment properties | - | 1,514 | ||||||
Acquisition of premises and equipment | 40,454 | 57,266 | ||||||
Acquisition of intangible assets | 61,454 | 56,640 | ||||||
Net increase of other assets | - | 2,671 | ||||||
22,158,640 | 18,806,564 | |||||||
Net cash inflow(outflow) from investing activities | 522,340 | (801,344 | ) | |||||
Cash flows from financing activities: | ||||||||
Cash in-flows from financing activities: | ||||||||
Net increase in derivatives designated for hedging purpose | 2,480 | - | ||||||
Net increase in borrowings | 1,485,574 | 1,960,150 | ||||||
Issuance of debentures | 15,187,733 | 10,849,477 | ||||||
Net increase of other liabilities | 3,224 | 5,516 | ||||||
Issuance of hybrid securities | 199,452 | 698,277 | ||||||
16,878,463 | 13,513,420 | |||||||
Cash out-flows from financing activities: | ||||||||
Net decrease in derivatives designated for hedging purpose | - | 6,054 | ||||||
Redemption of debentures | 11,867,048 | 10,893,170 | ||||||
Redemption of lease liabilities | 92,223 | 102,968 | ||||||
Dividends paid | 260,016 | 505,587 | ||||||
Redemption of hybrid securities | - | 598,850 | ||||||
Dividends paid to hybrid securities | 103,087 | 110,456 | ||||||
Dividends paid to non-controlling interest | 9,374 | 2,054 | ||||||
Changes in non-controlling interests | 52,947 | - | ||||||
Paid-in capital decrease on non-controlling interests | 27 | - | ||||||
12,384,722 | 12,219,139 | |||||||
Net cash inflow from financing activities | 4,493,741 | 1,294,281 | ||||||
Net increase(decrease) in cash and cash equivalents | (3,052 | ) | 3,005,289 | |||||
Cash and cash equivalents, beginning of the period | 9,990,983 | 6,392,566 | ||||||
Effects of exchange rate changes on cash and cash equivalents | 423,415 | 39,764 | ||||||
Cash and cash equivalents, end of the period (Note 6) | 10,411,346 | 9,437,619 | ||||||
The accompanying notes are part of this consolidated interim financial statement.
- 9 -
WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS
AS OF JUNE 30, 2021 AND 2020 (UNAUDITED)
1. | GENERAL |
(1) | Summary of the Parent company |
Woori Financial Group, Inc. (hereinafter referred to the 'Parent company' or the 'Company') is primarily aimed at controlling subsidiaries that operate in the financial industry or those that are closely related to the financial industry through the ownership of shares and was established on January 11, 2019 under the Financial Holding Company Act through the comprehensive transfer with shareholders of Woori Bank (hereinafter referred to the 'Bank'), Woori FIS Co., Ltd., Woori Finance Research Institute Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Services Co., Ltd. and Woori Private Equity Asset Management Co. Ltd. The headquarters of the Parent company is located at 51, Sogong-ro,Jung-gu, Seoul, Korea, and the capital is 3,611,338 million Won as of June 30, 2021 while the Korea Deposit Insurance Corp. ('KDIC'), the Parent company's largest shareholder, owns 110,159,443 shares (15.25%) of the Parent company's stocks issued. The Company's stocks were listed on the Korea Exchange on February 13, 2019, and its American Depository Shares ('ADS') are also being traded as the underlying common stock on the New York Stock Exchange since the same date.
The details of stock transfer between the Parent company and subsidiaries as of incorporation are as follows (Unit: Number of shares)
Stock transfer company |
Total number of issued shares |
Exchange ratio per share |
Number of Parent company's stocks | |||||||||
Woori Bank | 676,000,000 | 1.0000000 | 676,000,000 | |||||||||
Woori FIS Co., Ltd. | 4,900,000 | 0.2999708 | 1,469,857 | |||||||||
Woori Finance Research Institute Co., Ltd. | 600,000 | 0.1888165 | 113,289 | |||||||||
Woori Credit Information Co., Ltd. | 1,008,000 | 1.1037292 | 1,112,559 | |||||||||
Woori Fund Service Co., Ltd. | 2,000,000 | 0.4709031 | 941,806 | |||||||||
Woori Private Equity Asset Management Co., Ltd. | 6,000,000 | 0.0877992 | 526,795 |
As of August 1, 2019, the Parent company acquired a 73% interest in Tongyang Asset Management Co., Ltd. and changed the name to Woori Asset Management Corp. Also, as of August 1, 2019, the Parent company gained 100% control of ABL Asset Management Co., Ltd., added it as a consolidated subsidiary and changed the name to Woori Global Asset Management Co., Ltd. on December 6, 2019.
The Parent company paid 598,391 million Won in cash and 42,103,377 new shares of the Parent company to acquire 100% interest of Woori Card Co., Ltd. from its subsidiary, Woori Bank, on September 10, 2019. On the same date, the Parent company also acquired 59.8% interest of Woori Investment Bank Co., Ltd. from Woori Bank with 392,795 million Won in cash.
As of December 30, 2019, the Parent company acquired a 67.2% interest (excluding treasury stocks, 51% interest including treasury stocks) in Woori Asset Trust Co., Ltd. (formerly Kukje Asset Trust Co., Ltd.) and added it as a consolidated subsidiary at the end of 2019.
The Parent company acquired 76.8% (excluding treasury stocks, 74.0% interest including treasury stocks) interest in Woori Financial Capital Co., Ltd. (formerly Aju Capital Co., Ltd.) on December 10, 2020. In addition, as of April 15, 2021, the Group acquired 13.3% interests (excluding treasury stock, 12.9% when including treasury stock) in Woori Financial Capital Co., Ltd., and as of May 24, 2021, the Group additionally acquired treasury stock (3.6%) which Woori Financial Capital Co., Ltd. possessed.
The Parent Company paid 113,238 million Won in cash to acquire 100% interest of Woori Savings Bank from its subsidiary, Woori Financial Capital Co., Ltd., on March 12, 2021.
- 10 -
(2) | Details of the Parent company and subsidiaries (hereinafter referred to the 'Group') as of June 30, 2021 and December 31, 2020 are as follows: |
Percentage of ownership (%) | Location |
Financial | ||||||||||||||
Subsidiaries | Main business |
June 30, 2021 |
December 31, 2020 | |||||||||||||
Held by Woori Financial Group Inc. | ||||||||||||||||
Woori Bank | Bank | 100.0 | 100.0 | Korea | June 30 | |||||||||||
Woori Card Co., Ltd. | Finance | 100.0 | 100.0 | Korea | June 30 | |||||||||||
Woori Financial Capital Co., Ltd. | Finance | 90.5 | 76.8 | Korea | June 30 | |||||||||||
Woori Investment Bank Co., Ltd. | Other credit finance business | 58.7 | 58.7 | Korea | June 30 | |||||||||||
Woori Asset Trust Co., Ltd. | Real estate trust | 67.2 | 67.2 | Korea | June 30 | |||||||||||
Woori Asset Management Corp. | Finance | 73.0 | 73.0 | Korea | June 30 | |||||||||||
Woori Savings Bank (*7) | Bank | 100.0 | - | Korea | June 30 | |||||||||||
Woori Credit Information Co., Ltd. | Credit information | 100.0 | 100.0 | Korea | June 30 | |||||||||||
Woori Fund Service Co., Ltd. | Financial support service business | 100.0 | 100.0 | Korea | June 30 | |||||||||||
Woori Private Equity Asset Management Co., Ltd. | Finance | 100.0 | 100.0 | Korea | June 30 | |||||||||||
Woori Global Asset Management Co., Ltd. | Finance | 100.0 | 100.0 | Korea | June 30 | |||||||||||
Woori FIS Co., Ltd. | System software development & maintenance | 100.0 | 100.0 | Korea | June 30 | |||||||||||
Woori Finance Research Institute Co., Ltd. | Other service business | 100.0 | 100.0 | Korea | June 30 | |||||||||||
Held by Woori Bank | ||||||||||||||||
Woori America Bank | Finance | 100.0 | 100.0 | America | June 30 | |||||||||||
Woori Global Markets Asia Limited | Finance | 100.0 | 100.0 | Hong Kong | June 30 | |||||||||||
Woori Bank China Limited | Finance | 100.0 | 100.0 | China | June 30 | |||||||||||
AO Woori Bank | Finance | 100.0 | 100.0 | Russia | June 30 | |||||||||||
PT Bank Woori Saudara Indonesia 1906 Tbk | Finance | 79.9 | 79.9 | Indonesia | June 30 | |||||||||||
Banco Woori Bank do Brasil S.A. | Finance | 100.0 | 100.0 | Brazil | June 30 | |||||||||||
Korea BTL Infrastructure Fund | Finance | 99.9 | 99.9 | Korea | June 30 | |||||||||||
Woori Finance Myanmar Co., Ltd. | Finance | 100.0 | 100.0 | Myanmar | June 30 | |||||||||||
Wealth Development Bank | Finance | 51.0 | 51.0 | Philippines | June 30 | |||||||||||
Woori Bank Vietnam Limited | Finance | 100.0 | 100.0 | Vietnam | June 30 | |||||||||||
WB Finance Co., Ltd. (*1) | Finance | 100.0 | 100.0 | Cambodia | June 30 | |||||||||||
Woori Bank Europe | Finance | 100.0 | 100.0 | Germany | June 30 | |||||||||||
Kumho Trust First Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Asiana Saigon Inc. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
KAMCO Value Recreation First Securitization Specialty Co., Ltd. (*2) | Asset securitization | 15.0 | 15.0 | Korea | June 30 | |||||||||||
Hermes STX Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
BWL First Co., LLC (*5) | Asset securitization | - | 0.0 | Korea | - | |||||||||||
Deogi Dream Fourth Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Jeonju Iwon Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Wonju I one Inc. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Heitz Third Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Woorihansoop 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Woori International First Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Wibihansoop 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Uri QS 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Uri Display 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Tiger Eyes 2nd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Uri Display 2nd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Woori the Colony Unjung Securitization Specialty Co., Ltd. (*5) | Asset securitization | - | 0.0 | Korea | - | |||||||||||
Woori Dream 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Woori Dream 2nd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Woori H 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||||
Woori Sinnonhyeon 1st Inc. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 |
- 11 -
Percentage of ownership (%) | Location |
Financial | ||||||||||||
Subsidiaries | Main business |
June 30, 2021 |
December 31, 2020 | |||||||||||
Woori K 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Uri S 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Uri Display 3rd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
TY 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori HJ 2nd Co., Ltd. (*5) | Asset securitization | - | 0.0 | Korea | - | |||||||||
Woori-HJ 3rd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Uri K 2nd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori KC No.1 Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori QSell 2nd Co., Ltd. (*5) | Asset securitization | - | 0.0 | Korea | - | |||||||||
Quantum Jump the 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Quantum Jump the 2nd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori BK the 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori-HC 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Wivi Synergy 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
ATLANTIC TRANSPORTATION 1 S.A. (*2) | Asset securitization | 0.0 | 0.0 | Marshall islands | June 30 | |||||||||
Woori Gongdeok First Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
HD Project Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori HW 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori HC 2nd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori Dream 3rd Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori SJS 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori Steel 1st Co., Ltd (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
SPG the 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori-HWC 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori HC 3rd Co., Ltd. (*2). | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori Park I 1st co., Ltd (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori DS 1st co., Ltd (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori HC 4th Co., Ltd. (*2). | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori SKR 1st Co., Ltd. (*2). | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
Woori Hchemical 1st Co.,Ltd (*2) | Asset securitization | 0.0 | - | Korea | June 30 | |||||||||
HE the 1st Co.,Ltd. (*2) | Asset securitization | 0.0 | - | Korea | June 30 | |||||||||
Woori Hub The 1st Co., Ltd. (*2) | Asset securitization | 0.0 | - | Korea | June 30 | |||||||||
Woori K The 3rd Co., Ltd. (*2) | Asset securitization | 0.0 | - | Korea | June 30 | |||||||||
Woori KF 1st Co., Ltd. (*2) | Asset securitization | 0.0 | - | Korea | June 30 | |||||||||
WooriI TS 1st Co., Ltd. (*2) | Asset securitization | 0.0 | - | Korea | June 30 | |||||||||
Woori H Square 1st Co., Ltd. (*2) | Asset securitization | 0.0 | - | Korea | June 30 | |||||||||
G5 Pro Short-term Bond Investment Fund 13 (*3) | Securities investment and others | 100.0 | 100.0 | Korea | June 30 | |||||||||
Heungkuk Global Private Placement Investment Trust No. 1 (*3) | Securities investment and others | 98.5 | 98.5 | Korea | June 30 | |||||||||
AI Partners UK Water Supply Private Placement Investment Trust No.2 (*3) | Securities investment and others | 97.3 | 97.3 | England | June 30 | |||||||||
Multi Asset Global Real Estate Investment Trust No. 5-2 (*3) | Securities investment and others | 99.0 | 99.0 | Korea | June 30 | |||||||||
Igis Australia Investment Trust No. 209-1 (*3) | Securities investment and others | 99.4 | 99.4 | Korea | June 30 | |||||||||
INMARK Spain Private Placement Real Estate Investment Trust No. 26-2 (*3) | Securities investment and others | 97.7 | 97.7 | Korea | June 30 | |||||||||
Woori G Japan Investment Trust No. 1-2 (*3) | Securities investment and others | 98.8 | 98.8 | Korea | June 30 | |||||||||
IGIS Global Private Placement Real Estate Fund No. 316-1 (*3) | Securities investment and others | 99.3 | 99.3 | Korea | June 30 | |||||||||
Woori G Secondary Private Placement Investment Trust No. 1 (*3) | Securities investment and others | 97.2 | 97.2 | Korea | June 30 | |||||||||
WooriG Japan Blind Private Placement Real Estate Feeder Investment Trust No.1 (*3) | Securities investment and others | 99.7 | - | Korea | June 30 | |||||||||
Principal Guaranteed Trust (*4) | Trust | 0.0 | 0.0 | Korea | June 30 |
- 12 -
Percentage of ownership (%) | Location |
Financial | ||||||||||||
Subsidiaries | Main business |
June 30, 2021 |
December 31, 2020 | |||||||||||
Principal and Interest Guaranteed Trust (*4) | Trust | 0.0 | 0.0 | Korea | June 30 | |||||||||
Held by Multi Asset Global Real Estate Investment Trust No. 5-2 | ||||||||||||||
MAGI No.5 LuxCo S.a.r.l. (*3) | Asset securitization | 54.6 | 54.6 | Luxembourg | June 30 | |||||||||
Held by MAGI No.5 LuxCo S.a.r.l. | ||||||||||||||
ADP 16 Brussels (*2) | Asset securitization | 0.0 | 0.0 | Belgium | June 30 | |||||||||
Held by Woori Card Co., Ltd. | ||||||||||||||
TUTU Finance -WCI Myanmar Co., Ltd. | Finance | 100.0 | 100.0 | Myanmar | June 30 | |||||||||
Woori Card one of 2017-2 Securitization Specialty Co., Ltd. (*5) | Asset securitization | - | 0.5 | Korea | - | |||||||||
Woori Card one of 2018-1 Securitization Specialty Co., Ltd. (*2) | Asset securitization | 0.5 | 0.5 | Korea | June 30 | |||||||||
Woori Card 2019-1 Asset Securitization Specialty Co., Ltd. (*2) | Asset securitization | 0.5 | 0.5 | Korea | June 30 | |||||||||
Woori Card 2020-1 Asset Securitization Specialty Co., Ltd. (*2) | Asset securitization | 0.5 | 0.5 | Korea | June 30 | |||||||||
Held by Woori Financial Capital Co., Ltd. | ||||||||||||||
Woori Savings Bank (*5) | Bank | - | 100.0 | Korea | - | |||||||||
ACE Auto Invest the 46th Securitization Specialty Co., Ltd. (*5) | Asset securitization | - | 1.0 | Korea | - | |||||||||
ACE Auto Invest the 47th Securitization Specialty Co., Ltd. (*2) | Asset securitization | 1.0 | 1.0 | Korea | June 30 | |||||||||
ACE Auto Invest the 48th Securitization Specialty Co., Ltd. (*2) | Asset securitization | 1.0 | 1.0 | Korea | June 30 | |||||||||
ACE Auto Invest the 49th Securitization Specialty Co., Ltd. (*2) | Asset securitization | 1.0 | 1.0 | Korea | June 30 | |||||||||
Specified Money Market Trust (*4) | Trust | 100.0 | 100.0 | Korea | June 30 | |||||||||
Held by Woori Investment Bank Co., Ltd. | ||||||||||||||
Seari First Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
Seari Second Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
Namjong 1st Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
Bukgeum First Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
Bukgeum Second Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
WS1909 Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
WS2003 Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
WS2006 Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
WJ2008 Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | 5.0 | Korea | June 30 | |||||||||
WH2103 Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | - | Korea | June 30 | |||||||||
WN2103 Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | - | Korea | June 30 | |||||||||
WH2106 Securitization Specialty Co., Ltd. (*2) | Asset securitization | 5.0 | - | Korea | June 30 |
- 13 -
Percentage of ownership (%) | Location |
Financial | ||||||||||||
Subsidiaries | Main business |
June 30, 2021 |
December 31, 2020 | |||||||||||
One Punch Korea the 1st Co., Ltd. (*2). | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
One Punch blue the 1st Co., Ltd. (*2) | Asset securitization | 0.0 | 0.0 | Korea | June 30 | |||||||||
One Punch red the 1st Co., Ltd. (*2) | Asset securitization | 0.0 | - | Korea | June 30 | |||||||||
Held by Woori Asset Management Corp. | ||||||||||||||
Woori China Convertible Bond Hedging feeder Investment Trust H (debt-oriented hybrid) (*5) | Securities investment and others | - | 99.6 | Korea | - | |||||||||
Woori China Convertible Bond Master Fund (debt-oriented hybrid) (*5)(*8) | Securities investment and others | - | 34.5 | Korea | - | |||||||||
Woori Yellow Chip High Yield Strategic Allocation 1 (FOF) (*5) | Securities investment and others | - | 89.8 | Korea | - | |||||||||
Woori Together TDF 2025 (*3) | Securities investment and others | 43.3 | 47.6 | Korea | June 30 | |||||||||
Woori Together TDF 2030 (*3) | Securities investment and others | 41.9 | 47.4 | Korea | June 30 | |||||||||
Woori Together TDF 2035 (*3) | Securities investment and others | 45.1 | 47.8 | Korea | June 30 | |||||||||
Woori Together TDF 2040 (*3) | Securities investment and others | 44.1 | 48.8 | Korea | June 30 | |||||||||
Woori Together TDF 2045 (*3) | Securities investment and others | 42.4 | 47.7 | Korea | June 30 | |||||||||
Woori Together TDF 2050 (*3) | Securities investment and others | 67.3 | 87.0 | Korea | June 30 | |||||||||
Woori Star50 Feeder Fund(H) (*3) | Securities investment and others | 45.1 | - | Korea | June 30 | |||||||||
Woori Star50 Master Fund (*3)(*8) | Securities investment and others | 69.3 | - | Korea | June 30 | |||||||||
Woori BIG2 Plus Securities Investment Trust(Balanced Bond) (*3) | Securities investment and others | 65.7 | - | Korea | June 30 | |||||||||
Held by Woori Financial Capital Co., Ltd., Woori Private Equity Asset Management Co., Ltd. and Woori Investment Bank Co., Ltd. (*6) | ||||||||||||||
Japanese Hotel Real Estate Private Equity Fund 1 (*3) | Securities investment and others | 100.0 | 100.0 | Korea | June 30 | |||||||||
Held by Woori Global Asset Management Co., Ltd. | ||||||||||||||
Woori G Global Multi Asset Income Private Placement Investment Trust_Class Cs (*3) | Securities investment and others | 22.2 | 22.2 | Korea | June 30 | |||||||||
Held by Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd., Woori Savings Bank and Woori Private Equity Asset Management Co., Ltd. (*6) | ||||||||||||||
Woori Innovative Growth Professional Investment Type Private Investment Trust No.1 (*3) | Securities investment and others | 90.0 | 90.0 | Korea | June 30 | |||||||||
Held by Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd. and Woori Private Equity Asset Management Co., Ltd. (*6) | ||||||||||||||
Woori Innovative Growth Professional Investment Type Private Investment Trust No.2 (*3) | Securities investment and others | 85.0 | 85.0 | Korea | June 30 |
- 14 -
Percentage of ownership (%) | Location | Financial statements date of use | ||||||||||||
Subsidiaries | Main business |
June 30, 2021 |
December 31, 2020 | |||||||||||
Held by Woori Bank, Woori Financial Capital Co., Ltd. and Woori Investment Bank Co., Ltd. (*6) | ||||||||||||||
WooriG GP Commitment Loan Private Placement Investment Trust No.1 (*3) | Securities investment and others | 100.0 | 50.0 | Korea | June 30 | |||||||||
Held by Woori bank and Woori Investment Bank Co., Ltd. (*6) | ||||||||||||||
Heungkuk Woori Tech Company Private Placement Investment Trust No. 1 (*3) | Securities investment and others | 100.0 | 100.0 | Korea | June 30 | |||||||||
Woori Global Development Infrastructure Synergy Company Private Placement Investment Trust No.1 (*3) | Securities investment and others | 100.0 | 100.0 | Korea | June 30 | |||||||||
Woori G NorthAmerica Infra Private Placement Investment Trust No. 1 (*3) | Securities investment and others | 100.0 | 100.0 | Korea | June 30 | |||||||||
Woori G Infrastructure New Deal Specialized Investment Private Equity Investment Trust No. 1 (*3) | Securities investment and others | 100.0 | 100.0 | Korea | June 30 | |||||||||
Woori G Private Placement Real Estate Investment Trust No.2 (*3) | Securities investment and others | 30.1 | 30.1 | Korea | June 30 | |||||||||
Held by Woori bank (*6) | ||||||||||||||
Woori G Woori Bank Partners Private Placement Investment Trust No. 1 (*3) | Securities investment and others | 92.6 | 92.6 | Korea | June 30 | |||||||||
Woori G Private Placement Real Estate Investment Trust No.1[USD] (*3) | Securities investment and others | 80.0 | 80.0 | Korea | June 30 | |||||||||
WooriG Global Mid-market Secondaries Private Placement Investment Trust No.1 (EUR) (*3) | Securities investment and others | 80.0 | 80.0 | Korea | June 30 | |||||||||
Held by Woori Financial Capital Co., Ltd. | ||||||||||||||
Woori G Japan Private Placement Real Estate Feeder Investment Trust No.1-1 (*3) | Securities investment and others | 63.2 | 63.2 | Korea | June 30 | |||||||||
Held by Woori G Japan Private Placement Real Estate Feeder Investment Trust No.1-1 and Woori G Japan Investment Trust No. 1-2 | ||||||||||||||
Woori G Japan Private Placement Real Estate Master Investment Trust No.1 (*3) | Securities investment and others | 100.0 | 100.0 | Korea | June 30 | |||||||||
Held by Woori Financial Capital Co., Ltd. and Woori Investment Bank Co., Ltd. (*6) | ||||||||||||||
Woori G Japan Private Placement Real Estate Master Investment Trust No.2-1 (*3) | Securities investment and others | 100.0 | - | Korea | June 30 | |||||||||
Held by Woori G Japan Private Placement Real Estate Master Investment Trust No.1 and Woori G Japan Private Placement Real Estate Master Investment Trust No.2-1 | ||||||||||||||
Woori G Japan Private Placement Real Estate Master Investment Trust No.2 (*3) | Securities investment and others | 100.0 | - | Korea | June 30 |
- 15 -
Percentage of ownership (%) | Location | Financial statements date of use | ||||||||||||
Subsidiaries | Main business |
June 30, 2021 |
December 31, 2020 | |||||||||||
Held by Woori G Japan Private Placement Real Estate Master Investment Trust No.1 | ||||||||||||||
GK OK Chatan (*3) | Other financial services | 99.9 | 99.9 | Japan | June 30 |
(*1) | The entity was merged with WB Finance Co., Ltd., which is a second-tier subsidiary, during prior period. |
(*2) | The entity is a structured entity for the purpose of asset securitization. Although the Group is not a majority shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns. |
(*3) | The entity is a structured entity for the purpose of investment in securities. Although the Group is not a majority shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns. |
(*4) | The entity is a 'money trust' under the Financial Investment Services and Capital Markets Act. Although the Group is not a majority shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns. |
(*5) | Companies are excluded from the consolidation as of June 30, 2021. |
(*6) | Determined that the Group controls the investees, considering the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns, by two or more subsidiaries' investment or operation. |
(*7) | During March 2021, the Company acquired a 100% equity of Woori Financial Savings Bank from the company's subsidiary Woori Financial Capital Co., Ltd. which makes a business combination under the same control. For business combinations under the same control, the company accounts the business combination in the carrying amount method, and the assets and liabilities transferred are measured at the carrying amount included in the consolidated financial statements. The amounts of assets and liabilities transferred due to the business combination are 1,119,371 million won and 1,084,771 million, respectively. |
(*8) | As a master-feeder fund, the equity ratio is the equity of the subsidiary in parent fund. |
- 16 -
(3) | The Group has not consolidated the following entities as of June 30, 2021 and December 31, 2020 despite having more than 50% ownership interest: |
As of June 30, 2021 | ||||||||||||
Subsidiaries | Location | Main Business |
Percentage of ownership (%) | |||||||||
Mirae Asset Maps Clean Water Private Equity Investment Trust 7th (*) | Korea | Securities Investment | 59.7 | |||||||||
Kiwoom Yonsei Private Equity Investment Trust (*) | Korea | Securities Investment | 88.9 | |||||||||
IGIS Europe Private Placement Real Estate Fund No. 163-2 (*) | Korea | Securities Investment | 97.9 | |||||||||
IGIS Global Private Placement Real Estate Fund No. 148-1 (*) | Korea | Securities Investment | 75.0 | |||||||||
IGIS Global Private Placement Real Estate Fund No. 148-2 (*) | Korea | Securities Investment | 75.0 | |||||||||
Mirae Asset Seoul Ring Expressway Private Special Asset Fund No. 1 (*) | Korea | Securities Investment | 66.7 | |||||||||
Hangkang Sewage Treatment Plant Fund (*) | Korea | Securities Investment | 55.6 | |||||||||
KIM Pocheon-Hwado Highway Infra Private Placement Special Asset Fund (*) | Korea | Securities Investment | 55.2 | |||||||||
Kiwoom-Harmony Private Placement Investment Trust No.2 (*) | Korea | Securities Investment | 96.7 | |||||||||
Kiwoom-Harmony Private Placement Investment Trust No.1 (*) | Korea | Securities Investment | 95.7 | |||||||||
Midas Global Private Placement Real Estate Investment Trust No. 7-2 (*) | Korea | Securities Investment | 58.3 | |||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No.3 (*) | Korea | Securities Investment | 100.0 | |||||||||
INMARK France Private Placement Investment Trust No. 18-1 (*) | Korea | Securities Investment | 93.8 | |||||||||
Kiwoom Vibrato Private Placement Investment Trust 1-W(EUR) (*) | Korea | Securities Investment | 99.4 | |||||||||
KOTAM Global Infra Private Fund 1-4 (*) | Korea | Securities Investment | 99.7 | |||||||||
JB Airline Professional investor type private placement fund 8 (*) | Korea | Securities Investment | 96.7 | |||||||||
UBSHana Class 1 Special Asset Investment Trust 3 Class C (*) | Korea | Securities Investment | 51.0 | |||||||||
Kiwoom Bright Light Professional Private Investment Trust (*) | Korea | Securities Investment | 50.0 | |||||||||
Consus GyeongJuGreen Specialized Private Special Asset Investment Trust 1 (*) | Korea | Securities Investment | 50.0 | |||||||||
Consus Solar Energy Private Special Asset Investment Trust (*) | Korea | Securities Investment | 50.0 |
(*) | Since the investee is a private equity investment fund, the Group does not have the power over the fund's activities even though it holds more than 50% of ownership interest. |
As of December 31, 2020 | ||||||||||||
Subsidiaries | Location | Main Business |
Percentage of ownership (%) | |||||||||
Mirae Asset Maps Clean Water Private Equity Investment Trust 7th (*) | Korea | Securities Investment | 59.7 | |||||||||
Kiwoom Yonsei Private Equity Investment Trust (*) | Korea | Securities Investment | 88.9 | |||||||||
IGIS Europe Private Placement Real Estate Fund No. 163-2 (*) | Korea | Securities Investment | 97.9 | |||||||||
IGIS Global Private Placement Real Estate Fund No. 148-1 (*) | Korea | Securities Investment | 75.0 | |||||||||
IGIS Global Private Placement Real Estate Fund No. 148-2 (*) | Korea | Securities Investment | 75.0 | |||||||||
Mirae Asset Seoul Ring Expressway Private Special Asset Fund No. 1 (*) | Korea | Securities Investment | 66.7 | |||||||||
Hangkang Sewage Treatment Plant Fund (*) | Korea | Securities Investment | 55.6 | |||||||||
KIM Pocheon-Hwado Highway Infra Private Placement Special Asset Fund (*) | Korea | Securities Investment | 55.2 | |||||||||
Kiwoom-Harmony Private Placement Investment Trust No.2 (*) | Korea | Securities Investment | 96.3 | |||||||||
Kiwoom-Harmony Private Placement Investment Trust No.1 (*) | Korea | Securities Investment | 95.7 | |||||||||
Midas Global Private Placement Real Estate Investment Trust No. 7-2 (*) | Korea | Securities Investment | 58.3 | |||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No.3 (*) | Korea | Securities Investment | 100.0 | |||||||||
INMARK France Private Placement Investment Trust No. 18-1 (*) | Korea | Securities Investment | 93.8 | |||||||||
Kiwoom Vibrato Private Placement Investment Trust 1-W(EUR) (*) | Korea | Securities Investment | 99.3 |
(*) | Since the investee is a private equity investment fund, the Group does not have the power over the fund's activities even though it holds more than 50% of ownership interest. |
- 17 -
(4) | The summarized financial information of the major subsidiaries are as follows. The financial information of each subsidiary was prepared based on their consolidated financial statements (Unit: Korean Won in millions): |
As of June 30, 2021 | For the six-month period ended June 30, 2021 | |||||||||||||||||||
Subsidiaries | Assets | Liabilities |
Operating revenue |
Net income (loss) attributable to owners |
Comprehensive income (loss) attributable to owners | |||||||||||||||
Woori Bank | 393,520,653 | 369,318,152 | 11,760,294 | 1,279,637 | 1,429,762 | |||||||||||||||
Woori Card Co., Ltd. | 12,645,157 | 10,467,730 | 741,298 | 121,435 | 126,396 | |||||||||||||||
Woori Financial Capital Co., Ltd. | 8,761,211 | 7,831,718 | 422,966 | 82,527 | 83,600 | |||||||||||||||
Woori Investment Bank Co., Ltd. | 4,860,424 | 4,296,271 | 149,233 | 44,035 | 44,015 | |||||||||||||||
Woori Asset Trust Co., Ltd. | 211,428 | 61,779 | 42,764 | 21,571 | 21,557 | |||||||||||||||
Woori Asset Management Corp. | 134,799 | 17,274 | 16,067 | 4,422 | 4,476 | |||||||||||||||
Woori Savings Bank | 1,286,793 | 1,071,240 | 36,648 | 9,262 | 8,859 | |||||||||||||||
Woori Credit Information Co., Ltd. | 41,084 | 9,513 | 18,947 | 1,109 | 1,106 | |||||||||||||||
Woori Fund Service Co., Ltd. | 19,625 | 2,097 | 7,452 | 1,512 | 1,512 | |||||||||||||||
Woori Private Equity Asset Management Co., Ltd. | 40,731 | 1,059 | 1,963 | 3,706 | 3,647 | |||||||||||||||
Woori Global Asset Management Co., Ltd. | 38,589 | 10,356 | 6,414 | 105 | 105 | |||||||||||||||
Woori FIS Co., Ltd. | 87,078 | 58,368 | 130,485 | (9,075 | ) | (9,193 | ) | |||||||||||||
Woori Finance Research Institute Co., Ltd. | 6,387 | 2,958 | 3,410 | (107 | ) | (114 | ) |
As of June 30, 2020 | For the six-month period ended June 30, 2020 | |||||||||||||||||||
Subsidiaries | Assets | Liabilities |
Operating revenue |
Net income (loss) attributable to owners |
Comprehensive income (loss) attributable to owners | |||||||||||||||
Woori Bank | 374,310,415 | 350,790,158 | 13,836,037 | 677,937 | 696,858 | |||||||||||||||
Woori Card Co., Ltd. | 11,366,596 | 9,312,986 | 708,328 | 79,654 | 50,029 | |||||||||||||||
Woori Financial Capital Co., Ltd. (*) | 8,880,117 | 8,053,840 | - | - | - | |||||||||||||||
Woori Investment Bank Co., Ltd. | 4,332,474 | 3,803,594 | 135,093 | 31,435 | 31,301 | |||||||||||||||
Woori Asset Trust Co., Ltd. | 185,634 | 56,396 | 128,979 | 2,220 | 2,152 | |||||||||||||||
Woori Asset Management Corp. | 136,460 | 23,411 | 3,169 | 242 | 242 | |||||||||||||||
Woori Credit Information Co., Ltd. | 40,860 | 9,830 | 20,774 | 1,469 | 1,311 | |||||||||||||||
Woori Fund Service Co., Ltd. | 18,957 | 2,172 | 6,300 | 990 | 990 | |||||||||||||||
Woori Private Equity Asset Management Co., Ltd. | 38,035 | 2,009 | 39,079 | 20,198 | 20,177 | |||||||||||||||
Woori Global Asset Management Co., Ltd. | 37,935 | 9,807 | 12,059 | 3,183 | 2,771 | |||||||||||||||
Woori FIS Co., Ltd. | 97,479 | 59,577 | 2,424 | 74 | 28 | |||||||||||||||
Woori Finance Research Institute Co., Ltd. | 7,232 | 3,689 | 5,602 | (760 | ) | (760 | ) |
(*) | Since Woori Financial Capital Co., Ltd. has acquired control after the end of the first half of last year, operating income, profit or loss from the parent company, and total comprehensive income of the parent company have not been prepared. |
- 18 -
(5) | The financial support that the Group provides to consolidated structured entities is as follows: |
• | Structured entity for asset securitization |
The structured entity which is established for the purpose of securitization of project financing loans, corporate bonds, and other financial assets. The Group is involved with the structured entity through provision of credit facility over asset-backed commercial papers issued by the entity, originating loans directly to the structured entity, or purchasing 100% of the subordinated debts issued by the structured entity.
• | Structured entity for the investments in securities |
The structured entity is established for the purpose of investments in securities. The Group acquires beneficiary certificates through its contribution of funding to the structured entity by the Group, and it is exposed to the risk that it may not be able to recover its fund depending on the result of investment performance of asset managers of the structured entity.
• | Money trust under the Financial Investment Services and Capital Markets Act |
The Group provides with financial guarantee of principal and interest or solely principal to some of its trust products. Due to the financial guarantees, the Group may be obliged when the principal and interest or principal of the trust product sold is short of the guaranteed amount depending on the result of investment performance of the trust product.
As of June 30, 2021 and December 31, 2020, the Group provides 2,775,207 million Won and 2,547,418 million Won of credit facilities, respectively, for the structured entities mentioned above. As of June 30, 2021 and December 31, 2020, the purchase commitment amounts to 1,186,872 million Won and 854,231 million Won, respectively.
- 19 -
(6) | The Group has entered into various agreements with structured entities such as asset securitization, structured finance, investment fund, and monetary trust. The characteristics and the nature of risks related to unconsolidated structured entities over which the Group does not have control in accordance with Korean IFRS 1110 are as follows: |
The interests in unconsolidated structured entities that the Group hold are classified into asset securitization vehicles, structured finance, investment fund and real-estate trust, based on the nature and the purpose of each structured entity.
Unconsolidated structured entities classified as 'asset securitization vehicles' are entities that issue asset-backed securities, pay the principal and interest or distributes dividends on asset-backed securities through borrowings or profits from the management, operation and sale of securitized assets. The Group has been purchasing commitments of asset-backed securities or issuing asset-backed securities through credit grants, and the structured entities recognize related interest or fee revenue. There are entities that provide additional funding and conditional debt acquisition commitments before the Group's financial support, but the Group is still exposed to losses arising from the purchase of financial assets issued by the structured entities when it fails to renew the securities.
Unconsolidated structured entities classified as 'structured financing' include real estate project financing investment vehicle, social overhead capital companies, and special purpose companies for ship (aircraft) financing. Each entity is incorporated as a separate company with a limited purpose in order to efficiently pursue business goals. 'Structured financing' is a financing method for large-scale risky business, with investments made based on feasibility of the specific business or project, instead of credit of business owner or physical collaterals. The investors receive profits from the operation of the business. The Group recognizes interest revenue, profit or loss from assessment or transactions of financial instruments, or dividend income. With regard to uncertainties involving structured financing, there are entities that provide financial support such as additional fund, guarantees and prioritized credit grants prior to the Group's intervention, but the Group is exposed to possible losses due to loss of principal from reduction in investment value or irrecoverable loans arising from failure to collect scheduled cash flows and cessation of projects.
Unconsolidated structured entities classified as 'investment funds' include investment trusts and private equity funds. An investment trust orders the investment and operation of funds to the trust manager in accordance with trust contract with profits distributed to the investors. Private equity funds finances money required to acquire equity securities to enable direction of management and/or improvement of ownership structure, with profit distributed to the investors. The Group recognizes pro rata amount of valuation gain or loss on investment and dividend income as an investor and may be exposed to losses due to reduction in investment value. Investments in MMF (Money Market Funds) as of June 30, 2021 and December 31, 2020 are 631,711 million Won and 427,375 million Won, respectively, and there are no additional commitments for MMF.
'Real estate trust' is to be entrusted the underlying property for the purpose of managing, disposing, operating or developing from the consignor who owns the property and distributes the proceeds achieved through the trust to the beneficiary. When the consignee does not fulfill his or her important obligations in the trust contract or it is, in fact, difficult to run the business, the Group may be exposed to the threat of compensating the loss.
The total assets of the unconsolidated structured entity held by the Group, the carrying amount of the items recognized in the consolidated financial statements, the maximum loss exposure, and the losses from the unconsolidated structured entity are as follows. The maximum loss exposure includes the amount of investment recognized in the consolidated financial statements and the amount that is likely to be confirmed in the future when satisfies certain conditions by contracts such as purchase arrangements, credit offerings. As of June 30, 2021 and December 31, 2020, the purchase commitment amounts to 3,353,699 million Won and 4,266,319 million Won, respectively.
- 20 -
June 30, 2021 | ||||||||||||||||
Asset securitization vehicle |
Structured Finance |
Investment Funds |
Real-estate trust | |||||||||||||
Total asset of the unconsolidated structured entities | 4,624,493 | 87,656,926 | 67,190,894 | 1,389,925 | ||||||||||||
Assets recognized in the consolidated financial statements related to the unconsolidated structured entities | 469,057 | 4,345,802 | 4,388,319 | 37,894 | ||||||||||||
Financial assets at FVTPL | 315,128 | 8,771 | 3,790,995 | 12,875 | ||||||||||||
Financial assets at FVTOCI | 39,931 | 46,932 | - | - | ||||||||||||
Financial assets at amortized cost | 113,222 | 4,286,364 | 39,956 | 25,019 | ||||||||||||
Investments in joint ventures and associates | - | - | 557,368 | - | ||||||||||||
Derivative assets | 776 | 3,735 | - | - | ||||||||||||
Liabilities recognized in the consolidated financial statements related to the unconsolidated structured entities | 212 | 1,235 | - | 2,010 | ||||||||||||
Other liabilities (provisions) | 212 | 1,235 | - | 2,010 | ||||||||||||
The maximum exposure to risks | 765,467 | 5,422,983 | 4,395,395 | 97,538 | ||||||||||||
Investment assets | 469,057 | 4,345,802 | 4,388,319 | 37,894 | ||||||||||||
Credit facilities and others | 296,410 | 1,077,181 | 7,076 | 59,644 | ||||||||||||
Loss recognized on unconsolidated structured entities | - | 2,161 | 16,193 | 111 |
December 31, 2020 | ||||||||||||||||
Asset securitization vehicle |
Structured Finance |
Investment Funds |
Real-estate trust | |||||||||||||
Total asset of the unconsolidated structured entities | 3,900,254 | 69,010,369 | 44,629,638 | 76,772 | ||||||||||||
Assets recognized in the consolidated financial statements related to the unconsolidated structured entities | 648,700 | 4,291,535 | 3,350,605 | 22,402 | ||||||||||||
Financial assets at FVTPL | 374,231 | 167,271 | 2,922,716 | - | ||||||||||||
Financial assets at FVTOCI | 163,808 | 41,378 | - | - | ||||||||||||
Financial assets at amortized cost | 109,008 | 4,072,321 | 39,955 | 22,402 | ||||||||||||
Investments in joint ventures and associates | - | 5,958 | 387,902 | - | ||||||||||||
Derivative assets | 1,653 | 4,607 | 32 | - | ||||||||||||
Liabilities recognized in the consolidated financial statements related to the unconsolidated structured entities | 130 | 963 | - | 400 | ||||||||||||
Other liabilities (provisions) | 130 | 963 | - | 400 | ||||||||||||
The maximum exposure to risks | 970,628 | 5,366,037 | 3,438,924 | 65,722 | ||||||||||||
Investment assets | 648,700 | 4,291,535 | 3,350,605 | 22,402 | ||||||||||||
Credit facilities and others | 321,928 | 1,074,502 | 88,319 | 43,320 | ||||||||||||
Loss recognized on unconsolidated structured entities | - | 6,079 | 25,454 | 2,363 |
- 21 -
(7) | As of June 30, 2021 and December 31, 2020, the share of non-controlling interests on the net income and equity of subsidiaries in which non-controlling interests that are significant are as follows (Unit: Korean Won in millions): |
1) | Accumulated non-controlling interests at the end of the reporting period |
June 30, 2021 | December 31, 2020 | |||||||
Woori Bank (*) | 3,105,070 | 3,105,070 | ||||||
Woori Financial Capital Co., Ltd. | 69,081 | 166,369 | ||||||
Woori Investment Bank Co., Ltd. | 237,000 | 222,289 | ||||||
Woori Asset Trust Co., Ltd. | 55,517 | 49,738 | ||||||
Woori Asset Management Corp | 32,502 | 31,369 | ||||||
PT Bank Woori Saudara Indonesia 1906 Tbk | 83,255 | 79,890 | ||||||
Wealth Development Bank | 20,513 | 19,521 |
(*) | Hybrid securities issued by Woori Bank |
2) | Net income attributable to non-controlling interests |
For the six-month periods ended June 30 | ||||||||
2021 | 2020 | |||||||
Woori Bank (*) | 71,537 | 90,091 | ||||||
Woori Financial Capital Co., Ltd. | 16,329 | - | ||||||
Woori Investment Bank Co., Ltd. | 18,330 | 12,753 | ||||||
Woori Asset Trust Co., Ltd. | 6,149 | 5,699 | ||||||
Woori Asset Management Corp | 1,119 | 791 | ||||||
PT Bank Woori Saudara Indonesia 1906 Tbk | 3,512 | 3,796 | ||||||
Wealth Development Bank | 559 | 321 |
(*) | Distribution of the hybrid securities issued by Woori Bank |
3) | Dividends to non-controlling interests |
For the six-month periods ended June 30 | ||||||||
2021 | 2020 | |||||||
Woori Bank (*) | 71,537 | 90,091 | ||||||
Woori Financial Capital Co., Ltd. | 4,121 | - | ||||||
Woori Investment Bank Co., Ltd. | 3,610 | - | ||||||
Woori Asset Trust Co., Ltd | 365 | 365 | ||||||
PT Bank Woori Saudara Indonesia 1906 Tbk | 1,262 | 1,669 |
(*) | Distribution of the hybrid securities issued by Woori Bank |
- 22 -
2. | BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES |
The Group maintains its accounting records in Korean won and prepares statutory financial statements in the Korean language (Hangul) in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (Korean IFRS). The accompanying consolidated interim financial statements have been condensed, restructured and translated into English from the Korean language financial statements. The Group's condensed consolidated interim financial statements are condensed interim financial statements prepared in applying International Financial Reporting Standards as adopted by the Republic of Korea ('Korean IFRS') 1034 Interim Finance Reporting for some of periods in which the annual consolidated financial statements belong. It is necessary to use the Group's annual consolidated financial statements for the year ended December 31, 2020 for understanding of the accompanying condensed consolidated interim financial statements.
(1) | From the accounting period beginning on January 1, 2021, the Group has newly applied the following standards and interpretations. |
1) | Korean IFRS 1109 'Financial Instruments', Korean IFRS 1039 'Financial Instruments: Recognition and Measurement', Korean IFRS 1107 'Financial Instruments: Disclosures', Korean IFRS 1104 'Insurance Contracts' and Korean IFRS 1116 'Lease'; Interest Rate Benchmark Reform-Phase 2 |
The amendment indicates that the effective interest rate shall be adjusted rather than the carrying amount when changing the interest rate benchmark for financial instruments measured at amortized cost. In addition, it allows hedge accounting to continue without interruption even when changes to interest rate benchmark occur in the hedging relationship. The amendment does not have a significant impact on the consolidated financial statements.
The Group has applied 'Interest Rate Benchmark Reform-Phase 2', which is an amendment to Korean IFRS 1109, 1039, 1107 and 1116, beginning on January 1, 2021. In accordance with the transition provisions, the amendments were applied retrospectively to the hedging relationship and financial instruments. The comparative financial statements have not been restated and there is no effect of the adoption of the amendments on the beginning balance of reserves.
① | Hedging relationship |
The Phase 2 amendments address issues arising from 'Interest Rate Benchmark Reform-Phase 1', including when the designation and documentation of hedges should be updated and when alternative rates are permitted as hedged risk.
The Phase 1 amendments include an exceptional regulation that temporarily mitigates the application of specific hedge accounting requirements to hedging relationships directly affected by 'Interest Rate Benchmark Reform'. Due to this mitigation, 'Interest Rate Benchmark Reform' typically does not stop hedge accounting until there is a change of the contract. However, hedge ineffectiveness continues to be recorded in the income statement. It also suggests when the application of these exceptions should end, for instance, exceptional regulation should end when uncertainties due to 'Interest Rate Benchmark Reform' no longer appear.
- 23 -
For the period beginning January 1, 2021, the Group has applied the following hedge accounting mitigation provisions provided in the Phase 2 amendments:
Designation of a hedging relationship: When the Phase 1 amendments cause to apply, the Group will reflect the changes required by the Interest Rate Benchmark Reform by amending the formal designation of the hedging relationship as previously documented to make one or more of these changes: will amend the designation of a hedging relationship to reflect the changes required by the Interest Rate Benchmark Reform when there is a change in one or more of the followings:
• | Designating the alternative benchmark rate (contractually or non-contractually specified) as a hedged risk; |
• | Amending the description of the hedged item so it refers to the alternative benchmark rate; or |
• | Amending the description of the hedging instrument. |
The Group will amend the hedging relationship documentation to reflect these amendments by the end of the reporting period during which the changes are made. These amendments do not require the discontinuance of the hedging relationship.
② | Financial instruments measured at amortized cost |
For financial instruments measured at amortized cost (including financial assets at FVTOCI-debt instruments), the Phase 2 amendments do not require the financial instrument to recognize gains or losses from the change because the change in the contractual cash flow basis required by the interest rate reform is reflected by adjusting the effective interest rate.
A similar practical expedient exists for lease liabilities. This practical expedient is applicable only to changes required by interest rate indicator reform. When the changes are necessary as a direct result of Interest Rate Benchmark Reform and the new criteria for determining contractual cash flows are economically equivalent to the previous one, it is considered as a required change due to Interest Rate Benchmark Reform.
If some or all of the changes in the instrument's contractual cash flow calculation criteria do not meet the above criteria, the Group shall first apply the practical expedient to the changes made under the Interest Rate Benchmark Reform and then apply the general financial instrument requirements(In other words, the entity shall determine whether a modification or elimination is made and recognizes immediately in profit or loss any modification on financial instrument which has not been eliminated).
For lease liabilities which basis for determining contractual cash flows is changed, as a practical expedient, the lease liabilities are remeasured at a discount rate that reflects the change in interest rates due to the Interest Rate Benchmark Reform. If an additional lease change is made in addition to the lease changes required by the Interest Rate Benchmark Reform, the general requirements of Korean IFRS 1116 apply to the accounting for all simultaneous lease changes, including those required by the Interest Rate Benchmark Reform.
- 24 -
The details of Woori Bank's financial instruments that have not completed the conversion to interest rates benchmark at the end of the quarter are as follows: Non-derivative financial instrument is at the carrying amount, while the derivative financial instrument and commitments/financial guarantee is at the nominal amount.
USD | EUR | GBP | JPY | CHF | Total | |||||||||||||||||||
Non-derivative financial assets | ||||||||||||||||||||||||
Financial assets at FVTOCI | 620,409 | - | - | - | - | 620,409 | ||||||||||||||||||
Financial assets at amortized cost | 3,596,622 | 44,643 | 161,747 | 75,895 | - | 3,878,907 | ||||||||||||||||||
Sub-total | 4,217,031 | 44,643 | 161,747 | 75,895 | - | 4,499,316 | ||||||||||||||||||
Non-derivative financial liabilities | ||||||||||||||||||||||||
Financial liabilities at amortized cost | 931,120 | 12,796 | 21,648 | - | - | 965,564 | ||||||||||||||||||
Derivative finance | ||||||||||||||||||||||||
Interest rate related(trading) | 18,130,913 | - | 393,354 | 620,631 | 1,227 | 19,146,125 | ||||||||||||||||||
Currency related(trading) | 26,558,352 | - | 398,046 | 172,031 | - | 27,128,429 | ||||||||||||||||||
Interest rate related(hedging) | 2,090,500 | - | - | - | - | 2,090,500 | ||||||||||||||||||
Sub-total | 46,779,765 | - | 791,400 | 792,662 | 1,227 | 48,365,054 | ||||||||||||||||||
Commitments and financial guarantee | - | 5,902 | - | 1,840 | - | 7,742 | ||||||||||||||||||
2) | Amendments to Korean IFRS 1116 Lease - COVID-19 related rent concession continuously offered after June 30, 2021 |
As a practical expedient, a lessee may elect not to assess whether a rent concession occurring as a direct consequence of the COVID-19 pandemic is a lease modification. The scope of the practical expedient has been expanded to reduce lease fees that affect lease payments due on or before June 30, 2022. Lessee should consistently apply practical expedients to contracts with similar characteristics in similar circumstances.
(2) | The details of Korean IFRSs that have been issued and published since January 1, 2021 but have not yet reached the effective date are as follows: |
1) | Amendments to Korean IFRS 1103 Business Combination - Definition of a Business |
The amendments update a reference of definition of assets and liabilities qualify for recognition in revised Conceptual Framework for Financial Reporting. However, the amendments add an exception for the recognition of liabilities and contingent liabilities within the scope of Korean IFRS 1037 Provisions, Contingent Liabilities and Contingent Assets, and Korean IFRS 2121 Levies. The amendments also confirm that contingent assets should not be recognized at the acquisition date. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.
- 25 -
2) | Amendments to Korean IFRS 1016 Property, plant and equipment - Proceeds before intended use |
The amendments prohibit an entity from deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while the entity is preparing the asset for its intended use. Instead, the entity will recognize the proceeds from selling such items, and the costs of producing those items, in profit or loss. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.
3) | Amendments to Korean IFRS 1037 Provisions, Contingent Liabilities and Contingent Assets - Onerous Contracts: Cost of Fulfilling a Contract |
The amendments clarify that the direct costs of fulfilling a contract include both the incremental costs of fulfilling the contract and an allocation of other costs directly related to fulfilling contracts when assessing whether the contract is onerous. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.
4) | Annual Improvements to Korean IFRS 2018-2020 |
Annual improvements of Korean IFRS 2018-2020 Cycle should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.
• | Korean IFRS 1101 First time Adoption of Korean International Financial Reporting Standards - Subsidiaries that are first-time adopters |
• | Korean IFRS 1109 Financial Instruments - Fees related to the 10% test for derecognition of financial liabilities |
• | Korean IFRS 1116 Leases - Lease incentives |
• | Korean IFRS 1041 Agriculture - Measuring fair value |
5) | Amendments to Korean IFRS 1001 Presentation of Financial Statements - Classification of Liabilities as Current or Non-current |
The amendments clarify that liabilities are classified as either current or non-current, depending on the substantive rights that exist at the end of the reporting period. Classification is unaffected by the likelihood that an entity will exercise right to defer settlement of the liability or the expectations of management. Also, the settlement of liability include the transfer of the entity's own equity instruments, however, it would be excluded if an option to settle them by the entity's own equity instruments if compound financial instruments is met the definition of equity instruments and recognized separately from the liability. The amendments should be applied for annual periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.
The above enacted or amended standards will not have a significant impact on the Group.
(3) | Significant accounting policies and method of computation used in the preparation of the condensed consolidated interim financial statements are consistent with those of the consolidated financial statements for the year ended December 31, 2020, except for the one described below. |
• | Income tax expense |
Income tax expense for the interim period is recognized based on management's best estimate of the weighted average annual income tax rate expected for the full financial year. The estimated average annual tax rate is applied to the pre-tax income.
- 26 -
3. | SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS |
The outbreak of COVID-19 has had a significant impact on the global economy including Korea. Financial and economic shocks may have negative impacts on the Group's financial condition and results of operations in various forms both domestically and internationally, however, the Korean government is providing unprecedented financial and economic relief measures such as extension of maturity of loans. Despite the announcement of these various forms of government support policies, the negative impact of the COVID-19 on the global economy continues, and uncertainties in recovery or deterioration will persist.
The Group will continue to assess the adequacy of forward-looking information related to the duration of the impact of COVID-19 on economy and government policies.
The Bank determined that the credit risk of loans affected by the loan deferment has significantly increased; and evaluated that the possibility of default is high. As a result, total loans (Loans, payment guarantees) that are subject to loan deferment and interest deferment amount to 2,064,566 million Won, and expected credit loss allowance have increased for 209,223 million Won (199,915 million Won of corporate loan).
Total loans (Loans, payment guarantees) that are subject to loan deferment and interest deferment consist of corporate loan of 1,908,095 million Won and retail loan of 156,471 million Won. Among total loans, loans changed its stage from 12-month to lifetime (Stage 2) expected credit losses amount to 1,723,997 million Won, which consist of corporate loan of 1,596,024 million Won and retail loan of 127,973 million Won.
Woori Card Co., Ltd. determined that the credit risk of obligors receiving financial support due to COVID-19 significantly increased, and transferred the loss allowance at the amount equivalent to lifetime expected credit loss. As of June 30, 2021, financial assets at amortized cost of obligors subject to loan deferment and interest deferment amount to 7,744 million Won, and the cumulative expected credit loss allowance have increased for 179 million Won
Management shall make judgments, estimates and assumptions that affect the application of accounting policies and application of assets, liabilities and revenues and expenses in preparing condensed consolidated interim financial statements. Therefore, the actual results may differ from these estimates.
The important decisions made by management on the application of accounting policy of the Group and the main sources of estimation uncertainty in preparing condensed consolidated interim financial statements are the same as those applied to the consolidated financial statements for the year ended December 31, 2020, unless otherwise stated.
- 27 -
4. | RISK MANAGEMENT |
The Group's operating activity is exposed to various financial risks and the and the main types of risks are credit risk, market risk, liquidity risk, etc. The risk management department analyze and assess the level of complex risks in order to manage the risks and the risk management standards such as policies, regulations, management systems and decision-making have been established and operated for sound management of the Group.
The risk management organization is operated by risk management committee, risk management responsible, and risk management department. The Board of Directors operates a risk management committee comprised of outside directors for professional risk management. The risk management committee plays a role as the top decision-making body in risk management by establishing basic policies for risk management that are in line with the Group's management strategy and determining the risk level that the Group is willing to take. The risk management officer (CRO) assists the risk management committee and operates a group risk management council comprised of risk management managers of subsidiaries to periodically check and improve the risk burden of external environments and the Group. The risk management department is independent and is in charge of risk management of the Group. It also supports reporting and decision-making of key risk-related issues.
(1) | Credit risk |
Credit risk represents the possibility of financial losses incurred due to the refusal of the transaction or when the counterparty fails to fulfill its contractual obligations. The goal of credit risk management is to maintain the Group's credit risk exposure to a permissible degree and to optimize its rate of return considering such credit risk.
1) | Credit risk management |
The Group considers the probability of failure in performing the obligation of its counterparties, credit exposure to the counterparty, the related default risk and the rate of default loss. The Group uses the credit rating model to assess the possibility of counterparty's default risk; and when assessing the obligor's credit grade, other than quantitative methods utilizing financial statements and others, and assessor's judgement, the Group utilizes credit grades derived using statistical methods.
In order to manage credit risk limit, the Group establishes the appropriate credit line per obligor, company or industry. It monitors obligor's credit line, total exposures and loan portfolios when approving the loan.
The Group mitigates credit risk resulting from the obligor's credit condition by using financial and physical collateral, guarantees, netting agreements and credit derivatives. The Group has adopted the entrapment method to mitigate its credit risk. Credit risk mitigation is reflected in qualifying financial collateral, trade receivables, guarantees, residential and commercial real estate and other collaterals. The Group regularly performs a revaluation of collateral reflecting such credit risk mitigation.
- 28 -
2) | Maximum exposure |
The Group's maximum exposure to credit risk shows the uncertainties related to the maximum possible variation of financial assets' net value as a result of changes in the specific risk factors, prior to the consideration of collaterals that are recorded at net book value after allowances and other credit enhancements. However, the maximum exposure is the fair value amount (recorded on the books) for derivatives, maximum contractual obligation for payment guarantees and unused amount of commitments for loan commitment.
The maximum exposure to credit risk as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):
June 30, 2021 | December 31, 2020 | |||||||||
Loans and other financial assets at amortized cost (*1) | Korean treasury and government agencies | 20,639,049 | 9,725,719 | |||||||
Banks | 18,674,050 | 19,493,188 | ||||||||
Corporates | 122,677,013 | 114,131,996 | ||||||||
Consumers | 183,160,313 | 176,755,175 | ||||||||
Sub-total | 345,150,425 | 320,106,078 | ||||||||
Financial assets at FVTPL (*2) | Deposit | 70,150 | 48,796 | |||||||
Debt securities | 2,496,924 | 2,887,097 | ||||||||
Loans | 431,137 | 676,291 | ||||||||
Derivative assets | 4,024,668 | 6,901,742 | ||||||||
Sub-total | 7,022,879 | 10,513,926 | ||||||||
Financial assets at FVTOCI | Debt securities | 29,050,792 | 28,948,141 | |||||||
Securities at amortized cost | Debt securities | 15,725,241 | 17,020,839 | |||||||
Derivative assets | Derivative assets (Designated for hedging) | 129,562 | 174,820 | |||||||
Off-balance accounts | Guarantees (*3) | 12,354,750 | 11,809,456 | |||||||
Loan commitments | 114,270,804 | 112,088,680 | ||||||||
Sub-total | 126,625,554 | 123,898,136 | ||||||||
Total | 523,704,453 | 500,661,940 | ||||||||
(*1) | Cash and cash equivalents are not included. |
(*2) | Puttable financial instruments are not included. |
(*3) | As of June 30, 2021 and December 31, 2020, the financial guarantee amounts of 4,014,532 million Won and 4,163,382 million Won are included, respectively. |
- 29 -
a) | Credit risk exposure by geographical areas |
The following tables analyze credit risk exposure by geographical areas (Unit: Korean Won in millions):
June 30, 2021 | ||||||||||||||||||||||||||||
Korea | China | USA | UK | Japan | Others (*) | Total | ||||||||||||||||||||||
Loans and other financial assets at amortized cost | 325,425,315 | 4,677,171 | 3,378,362 | 217,790 | 674,543 | 10,777,244 | 345,150,425 | |||||||||||||||||||||
Securities at amortized cost | 15,391,303 | 148,257 | 30,422 | - | - | 155,259 | 15,725,241 | |||||||||||||||||||||
Financial assets at FVTPL | 5,369,744 | 1,508 | 628,450 | 217,748 | 139,015 | 666,414 | 7,022,879 | |||||||||||||||||||||
Financial assets at FVTOCI | 25,613,240 | 820,168 | 1,179,589 | 11,749 | 22,641 | 1,403,405 | 29,050,792 | |||||||||||||||||||||
Derivative assets (Designated for hedging) | - | - | 129,562 | - | - | - | 129,562 | |||||||||||||||||||||
Off-balance accounts | 122,951,908 | 917,101 | 413,345 | 39,069 | 42,853 | 2,261,278 | 126,625,554 | |||||||||||||||||||||
Total | 494,751,510 | 6,564,205 | 5,759,730 | 486,356 | 879,052 | 15,263,600 | 523,704,453 | |||||||||||||||||||||
(*) | Others consist of financial assets in Indonesia, Hong Kong, Germany, Australia, and other countries. |
December 31, 2020 | ||||||||||||||||||||||||||||
Korea | China | USA | UK | Japan | Others (*) | Total | ||||||||||||||||||||||
Loans and other financial assets at amortized cost | 296,186,751 | 4,356,747 | 3,988,304 | 1,990,490 | 1,404,670 | 12,179,116 | 320,106,078 | |||||||||||||||||||||
Securities at amortized cost | 16,749,531 | - | 110,597 | - | - | 160,711 | 17,020,839 | |||||||||||||||||||||
Financial assets at FVTPL | 6,954,630 | 13,403 | 1,083,096 | 493,285 | 480,760 | 1,488,752 | 10,513,926 | |||||||||||||||||||||
Financial assets at FVTOCI | 25,966,333 | 608,893 | 1,092,636 | 5 | 5,460 | 1,274,814 | 28,948,141 | |||||||||||||||||||||
Derivative assets (Designated for hedging) | - | - | 165,458 | 3,740 | - | 5,622 | 174,820 | |||||||||||||||||||||
Off-balance accounts | 119,699,069 | 1,393,734 | 399,678 | 38,389 | 41,378 | 2,325,888 | 123,898,136 | |||||||||||||||||||||
Total | 465,556,314 | 6,372,777 | 6,839,769 | 2,525,909 | 1,932,268 | 17,434,903 | 500,661,940 | |||||||||||||||||||||
(*) | Others consist of financial assets in Indonesia, Hong Kong, Germany, Australia, and other countries. |
b) | Credit risk exposure by industries |
① | The following tables analyze credit risk exposure by industries, which are service, manufacturing, finance and insurance, construction, individuals and others in accordance with the Korea Standard Industrial Classification Code as of June 30, 2021 and December 31, 2020 (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||||||||||||||
Service | Manufacturing |
Finance and insurance | Construction | Individuals | Others | Total | ||||||||||||||||||||||
Loans and other financial assets at amortized cost | 62,980,002 | 36,761,821 | 45,463,487 | 4,412,769 | 179,199,921 | 16,332,425 | 345,150,425 | |||||||||||||||||||||
Securities at amortized cost | 421,425 | 2,700 | 7,707,605 | 261,702 | - | 7,331,809 | 15,725,241 | |||||||||||||||||||||
Financial assets at FVTPL | 126,142 | 118,741 | 5,535,461 | 16,617 | 6,069 | 1,219,849 | 7,022,879 | |||||||||||||||||||||
Financial assets at FVTOCI | 356,681 | 255,779 | 20,654,610 | 154,118 | - | 7,629,604 | 29,050,792 | |||||||||||||||||||||
Derivative assets (Designated for hedging) | - | - | 129,562 | - | - | - | 129,562 | |||||||||||||||||||||
Off-balance accounts | 17,636,178 | 20,621,091 | 10,945,462 | 4,010,107 | 66,958,956 | 6,453,760 | 126,625,554 | |||||||||||||||||||||
Total | 81,520,428 | 57,760,132 | 90,436,187 | 8,855,313 | 246,164,946 | 38,967,447 | 523,704,453 | |||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||
Service | Manufacturing |
Finance and insurance | Construction | Individuals | Others | Total | ||||||||||||||||||||||
Loans and other financial assets at amortized cost | 56,627,927 | 35,933,953 | 35,450,774 | 3,493,000 | 172,116,780 | 16,483,644 | 320,106,078 | |||||||||||||||||||||
Securities at amortized cost | 492,172 | 6,691 | 8,926,909 | 302,225 | - | 7,292,842 | 17,020,839 | |||||||||||||||||||||
Financial assets at FVTPL | 301,296 | 234,712 | 8,520,127 | 32,240 | 14,619 | 1,410,932 | 10,513,926 | |||||||||||||||||||||
Financial assets at FVTOCI | 475,881 | 207,903 | 23,017,149 | 142,396 | - | 5,104,812 | 28,948,141 | |||||||||||||||||||||
Derivative assets (Designated for hedging) | - | - | 174,820 | - | - | - | 174,820 | |||||||||||||||||||||
Off-balance accounts | 18,828,656 | 21,460,581 | 12,086,935 | 4,060,358 | 62,477,117 | 4,984,489 | 123,898,136 | |||||||||||||||||||||
Total | 76,725,932 | 57,843,840 | 88,176,714 | 8,030,219 | 234,608,516 | 35,276,719 | 500,661,940 | |||||||||||||||||||||
- 30 -
② | The detailed industries of financial assets and corporate loans that might get affected by the spread of COVID-19 as of June 30, 2021 and December 31, 2020 are as follows and the industries that can be affected may change by future economic conditions (Unit: Korean Won in millions): |
< Woori Bank >
June 30, 2021 | ||||||||||||||||||
Loans and other financial assets at amortized cost |
Financial assets at FVTPL |
Financial assets at FVTOCI | ||||||||||||||||
Service business | Distribution business |
General retail business | 546,708 | 107 | - | |||||||||||||
General wholesale business | 718,486 | 207 | - | |||||||||||||||
Sub-total | 1,265,194 | 314 | - | |||||||||||||||
Accommodation business | 1,777,814 | 3,733 | 14,481 | |||||||||||||||
Travel business | 55,915 | - | - | |||||||||||||||
Art/sports, leisure service | 643,450 | 4,711 | - | |||||||||||||||
Food business | 1,180,054 | 488 | - | |||||||||||||||
Transportation business | 439,802 | 866 | 9,088 | |||||||||||||||
Others | 1,025,126 | 874 | - | |||||||||||||||
Sub-total | 6,387,355 | 10,986 | 23,569 | |||||||||||||||
Manufacturing | Textile | 2,421,918 | 1,636 | 10,104 | ||||||||||||||
Metal | 181,613 | 99 | - | |||||||||||||||
Non-metal | 147,335 | 126 | - | |||||||||||||||
Chemical | 888,883 | 3,254 | - | |||||||||||||||
Electronics | 98,094 | - | - | |||||||||||||||
Others | 194,558 | - | - | |||||||||||||||
Sub-total | 3,932,401 | 5,115 | 10,104 | |||||||||||||||
Total | 10,319,756 | 16,101 | 33,673 | |||||||||||||||
June 30, 2021 | ||||||||||||||
Off-balance accounts | Total | |||||||||||||
Service business | Distribution business |
General retail business | 283,262 | 830,077 | ||||||||||
General wholesale business | 251,697 | 970,390 | ||||||||||||
Sub-total | 534,959 | 1,800,467 | ||||||||||||
Accommodation business | 187,491 | 1,983,519 | ||||||||||||
Travel business | 14,495 | 70,410 | ||||||||||||
Art/sports, leisure service | 67,745 | 715,906 | ||||||||||||
Food business | 155,116 | 1,335,658 | ||||||||||||
Transportation business | 174,635 | 624,391 | ||||||||||||
Others | 138,743 | 1,164,743 | ||||||||||||
Sub-total | 1,273,184 | 7,695,094 | ||||||||||||
Manufacturing | Textile | 1,006,559 | 3,440,217 | |||||||||||
Metal | 34,275 | 215,987 | ||||||||||||
Non-metal | 48,747 | 196,208 | ||||||||||||
Chemical | 887,763 | 1,779,900 | ||||||||||||
Electronics | 37,802 | 135,896 | ||||||||||||
Others | 96,818 | 291,376 | ||||||||||||
Sub-total | 2,111,964 | 6,059,584 | ||||||||||||
Total | 3,385,148 | 13,754,678 | ||||||||||||
- 31 -
December 31, 2020 | ||||||||||||||||||
Loans and other financial assets at amortized cost |
Financial assets at FVTPL |
Financial assets at FVTOCI | ||||||||||||||||
Service business | Distribution business |
General retail business | 1,070,789 | 11,944 | 5,461 | |||||||||||||
General wholesale business | 1,407,563 | 3,573 | - | |||||||||||||||
Sub-total | 2,478,352 | 15,517 | 5,461 | |||||||||||||||
Accommodation business | 1,525,157 | 9,305 | 5,471 | |||||||||||||||
Travel business | 59,858 | - | - | |||||||||||||||
Art/sports, leisure service | 1,467,643 | 17,739 | - | |||||||||||||||
Food business | 1,078,832 | 2,515 | - | |||||||||||||||
Transportation business | 395,873 | 461 | 8,752 | |||||||||||||||
Education business | 367,701 | 489 | - | |||||||||||||||
Others | 1,286,578 | 2,691 | - | |||||||||||||||
Sub-total | 8,659,994 | 48,717 | 19,684 | |||||||||||||||
Manufacturing | Textile | 2,281,344 | 6,608 | 6,559 | ||||||||||||||
Metal | 1,390,290 | 47,903 | - | |||||||||||||||
Non-metal | 698,478 | 8,357 | - | |||||||||||||||
Chemical | 1,819,207 | 19,161 | - | |||||||||||||||
Transportation | 3,268,095 | 2,060 | - | |||||||||||||||
Electronics | 1,424,297 | 19,280 | - | |||||||||||||||
Cosmetics | 323,231 | 217 | - | |||||||||||||||
Others | 368,123 | 277 | - | |||||||||||||||
Sub-total | 11,573,065 | 103,863 | 6,559 | |||||||||||||||
Total | 20,233,059 | 152,580 | 26,243 | |||||||||||||||
December 31, 2020 | ||||||||||||||
Off-balance accounts | Total | |||||||||||||
Service business | Distribution business |
General retail business | 897,101 | 1,985,295 | ||||||||||
General wholesale business | 483,360 | 1,894,496 | ||||||||||||
Sub-total | 1,380,461 | 3,879,791 | ||||||||||||
Accommodation business | 152,059 | 1,691,992 | ||||||||||||
Travel business | 21,350 | 81,208 | ||||||||||||
Art/sports, leisure service | 114,388 | 1,599,770 | ||||||||||||
Food business | 135,680 | 1,217,027 | ||||||||||||
Transportation business | 193,578 | 598,664 | ||||||||||||
Education business | 48,064 | 416,254 | ||||||||||||
Others | 318,641 | 1,607,910 | ||||||||||||
Sub-total | 2,364,221 | 11,092,616 | ||||||||||||
Manufacturing | Textile | 1,064,005 | 3,358,516 | |||||||||||
Metal | 1,581,887 | 3,020,080 | ||||||||||||
Non-metal | 377,506 | 1,084,341 | ||||||||||||
Chemical | 3,233,405 | 5,071,773 | ||||||||||||
Transportation | 2,183,616 | 5,453,771 | ||||||||||||
Electronics | 1,789,605 | 3,233,182 | ||||||||||||
Cosmetics | 54,518 | 377,966 | ||||||||||||
Others | 1,483,551 | 1,851,951 | ||||||||||||
Sub-total | 11,768,093 | 23,451,580 | ||||||||||||
Total | 14,132,314 | 34,544,196 | ||||||||||||
- 32 -
< Woori Card Co., Ltd. >
June 30, 2021 | ||||||||||||||||||||
Loans and other financial assets at amortized cost |
Financial assets at FVTPL |
Financial assets at FVTOCI |
Off-balance accounts | Total | ||||||||||||||||
Accommodation business | 2,401 | - | - | 11,885 | 14,286 | |||||||||||||||
Travel business | 2,143 | - | - | 23,108 | 25,251 | |||||||||||||||
Aviation | 401 | - | - | 4,207 | 4,608 | |||||||||||||||
Cosmetics industry | 2,889 | - | - | 12,168 | 15,057 | |||||||||||||||
Distribution business | 6,986 | - | - | 39,566 | 46,552 | |||||||||||||||
Food industry | 29,960 | - | - | 138,292 | 168,252 | |||||||||||||||
Art/sports, leisure service | 6,991 | - | - | 47,150 | 54,141 | |||||||||||||||
Total | 51,771 | - | - | 276,376 | 328,147 | |||||||||||||||
December 31, 2020 | ||||||||||||||||||||
Loans and other financial assets at amortized cost |
Financial assets at FVTPL |
Financial assets at FVTOCI |
Off-balance accounts | Total | ||||||||||||||||
Accommodation business | 4,959 | - | - | 12,315 | 17,274 | |||||||||||||||
Travel business | 2,175 | - | - | 25,367 | 27,542 | |||||||||||||||
Aviation | 479 | - | - | 4,179 | 4,658 | |||||||||||||||
Cosmetics industry | 2,462 | - | - | 13,376 | 15,838 | |||||||||||||||
Distribution business | 8,050 | - | - | 44,354 | 52,404 | |||||||||||||||
Food industry | 33,084 | - | - | 163,711 | 196,795 | |||||||||||||||
Art/sports, leisure service | 6,156 | - | - | 51,962 | 58,118 | |||||||||||||||
Total | 57,365 | - | - | 315,264 | 372,629 | |||||||||||||||
- 33 -
June 30, 2021 | ||||||||||||||||||
Loans and other financial assets at amortized cost |
Financial assets at FVTPL |
Financial assets at FVTOCI | ||||||||||||||||
Service business | Distribution business |
General retail business | 103,009 | - | - | |||||||||||||
General wholesale business | 388,532 | - | - | |||||||||||||||
Sub-total | 491,541 | - | - | |||||||||||||||
Accommodation business | 8,213 | - | - | |||||||||||||||
Travel business | 67 | - | - | |||||||||||||||
Art/sports, leisure service | 9,434 | - | - | |||||||||||||||
Food business | 25,926 | - | - | |||||||||||||||
Transportation business | 63,857 | - | - | |||||||||||||||
Education business | 2,317 | - | - | |||||||||||||||
Others | 46,756 | - | - | |||||||||||||||
Sub-total | 648,111 | - | - | |||||||||||||||
Manufacturing | Textile | 85 | - | - | ||||||||||||||
Metal | 10,333 | - | - | |||||||||||||||
Non-metal | 7,748 | - | - | |||||||||||||||
Chemical | 2,777 | - | - | |||||||||||||||
Transportation | 1,533 | - | - | |||||||||||||||
Electronics | 1,122 | - | - | |||||||||||||||
Others | 192,100 | - | - | |||||||||||||||
Sub-total | 215,698 | - | - | |||||||||||||||
Total COVID-19 vulnerable business | 863,809 | - | - | |||||||||||||||
Other business | Others | 5,902,636 | 20,100 | - | ||||||||||||||
Total | 6,766,445 | 20,100 | - | |||||||||||||||
June 30, 2021 | ||||||||||||||
Off-balance accounts | Total | |||||||||||||
Service business | Distribution business |
General retail business | - | 103,009 | ||||||||||
General wholesale business | - | 388,532 | ||||||||||||
Sub-total | - | 491,541 | ||||||||||||
Accommodation business | - | 8,213 | ||||||||||||
Travel business | - | 67 | ||||||||||||
Art/sports, leisure service | - | 9,434 | ||||||||||||
Food business | - | 25,926 | ||||||||||||
Transportation business | - | 63,857 | ||||||||||||
Education business | - | 2,317 | ||||||||||||
Others | 800 | 47,556 | ||||||||||||
Sub-total | 800 | 648,911 | ||||||||||||
Manufacturing | Textile | - | 85 | |||||||||||
Metal | - | 10,333 | ||||||||||||
Non-metal | - | 7,748 | ||||||||||||
Chemical | - | 2,777 | ||||||||||||
Transportation | - | 1,533 | ||||||||||||
Electronics | - | 1,122 | ||||||||||||
Others | 2,766 | 194,866 | ||||||||||||
Sub-total | 2,766 | 218,464 | ||||||||||||
Total COVID-19 vulnerable business | 3,566 | 867,375 | ||||||||||||
Other business | Others | 931,395 | 6,854,131 | |||||||||||
Total | 934,961 | 7,721,506 | ||||||||||||
- 34 -
December 31, 2020 | ||||||||||||||||||
Loans and other financial assets at amortized cost |
Financial assets at FVTPL |
Financial assets at FVTOCI | ||||||||||||||||
Service business | Distribution business |
General retail business | 8,978 | - | - | |||||||||||||
General wholesale business | 57,587 | - | - | |||||||||||||||
Sub-total | 66,565 | - | - | |||||||||||||||
Accommodation business | 6,292 | - | - | |||||||||||||||
Travel business | 1,293 | - | - | |||||||||||||||
Art/sports, leisure service | 615 | - | - | |||||||||||||||
Food business | 21,774 | - | - | |||||||||||||||
Transportation business | 28,270 | - | - | |||||||||||||||
Education business | 1,132 | - | - | |||||||||||||||
Others | 365,860 | 27,364 | - | |||||||||||||||
Sub-total | 491,801 | 27,364 | - | |||||||||||||||
Manufacturing | Textile | 29,415 | - | - | ||||||||||||||
Metal | 17,963 | - | - | |||||||||||||||
Non-metal | 4,780 | - | - | |||||||||||||||
Chemical | 2,501 | - | - | |||||||||||||||
Transportation | 52,514 | - | - | |||||||||||||||
Electronics | 12,665 | - | - | |||||||||||||||
Others | 5,335 | - | - | |||||||||||||||
Sub-total | 125,173 | - | - | |||||||||||||||
Total COVID-19 vulnerable business | 616,974 | 27,364 | - | |||||||||||||||
Other business | Others | 6,202,754 | 225,078 | - | ||||||||||||||
Total | 6,819,728 | 252,442 | - | |||||||||||||||
December 31, 2020 | ||||||||||||||
Off-balance accounts | Total | |||||||||||||
Service business | Distribution business |
General retail business | - | 8,978 | ||||||||||
General wholesale business | - | 57,587 | ||||||||||||
Sub-total | - | 66,565 | ||||||||||||
Accommodation business | - | 6,292 | ||||||||||||
Travel business | - | 1,293 | ||||||||||||
Art/sports, leisure service | - | 615 | ||||||||||||
Food business | - | 21,774 | ||||||||||||
Transportation business | - | 28,270 | ||||||||||||
Education business | - | 1,132 | ||||||||||||
Others | 38,681 | 431,905 | ||||||||||||
Sub-total | 38,681 | 557,846 | ||||||||||||
Manufacturing | Textile | - | 29,415 | |||||||||||
Metal | 3,365 | 21,328 | ||||||||||||
Non-metal | - | 4,780 | ||||||||||||
Chemical | - | 2,501 | ||||||||||||
Transportation | - | 52,514 | ||||||||||||
Electronics | - | 12,665 | ||||||||||||
Others | - | 5,335 | ||||||||||||
Sub-total | 3,365 | 128,538 | ||||||||||||
Total COVID-19 vulnerable business | 42,046 | 686,384 | ||||||||||||
Other business | Others | 333,766 | 6,761,598 | |||||||||||
Total | 375,812 | 7,447,982 | ||||||||||||
- 35 -
< Woori Investment Bank Co., Ltd. >
June 30, 2021 | ||||||||||||||||||||
Loans and other financial assets at amortized cost |
Financial assets at FVTPL |
Financial assets at FVTOCI |
Off-balance accounts | Total | ||||||||||||||||
Accommodation business | 43,498 | - | - | - | 43,498 | |||||||||||||||
Distribution business | 25,156 | - | - | - | 25,156 | |||||||||||||||
Art/sports, leisure service | 21,349 | - | - | - | 21,349 | |||||||||||||||
Total | 90,003 | - | - | - | 90,003 | |||||||||||||||
December 31, 2020 | ||||||||||||||||||||
Loans and other financial assets at amortized cost |
Financial assets at FVTPL |
Financial assets at FVTOCI |
Off-balance accounts | Total | ||||||||||||||||
Accommodation business | 44,900 | - | - | - | 44,900 | |||||||||||||||
Distribution business | 15,716 | 20,000 | - | - | 35,716 | |||||||||||||||
Art/sports, leisure service | 28,000 | - | - | - | 28,000 | |||||||||||||||
Total | 88,616 | 20,000 | - | - | 108,616 | |||||||||||||||
- 36 -
3) | Credit risk exposure |
a) | Financial assets |
The maximum exposure to credit risk by asset quality, except for financial assets at FVTPL and derivative asset (Designated for hedging) as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):
June 30, 2021 | ||||||||||||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total |
Loss allowance | Total, net | |||||||||||||||||||||||||||
Above appropriate credit rating (*1) |
Less than a limited credit rating (*2) |
Above appropriate credit rating (*1) |
Less than a limited credit rating (*2) | |||||||||||||||||||||||||||||
Loans and other financial assets at amortized cost | 302,137,318 | 20,725,851 | 11,776,942 | 10,941,452 | 1,534,040 | 347,115,603 | (1,965,178 | ) | 345,150,425 | |||||||||||||||||||||||
Korean treasury and government agencies | 20,641,949 | 2,131 | - | - | - | 20,644,080 | (5,032 | ) | 20,639,048 | |||||||||||||||||||||||
Banks | 18,509,797 | 81,109 | 59,884 | - | 36,223 | 18,687,013 | (12,962 | ) | 18,674,051 | |||||||||||||||||||||||
Corporates | 102,330,464 | 14,241,769 | 2,100,146 | 4,412,048 | 755,720 | 123,840,147 | (1,163,131 | ) | 122,677,016 | |||||||||||||||||||||||
General business | 66,323,106 | 7,027,239 | 1,550,692 | 3,093,642 | 580,577 | 78,575,256 | (871,875 | ) | 77,703,381 | |||||||||||||||||||||||
Small- and medium-sized enterprise | 30,234,554 | 6,597,387 | 549,454 | 1,278,247 | 157,763 | 38,817,405 | (257,336 | ) | 38,560,069 | |||||||||||||||||||||||
Project financing and others | 5,772,804 | 617,143 | - | 40,159 | 17,380 | 6,447,486 | (33,920 | ) | 6,413,566 | |||||||||||||||||||||||
Consumers | 160,655,108 | 6,400,842 | 9,616,912 | 6,529,404 | 742,097 | 183,944,363 | (784,053 | ) | 183,160,310 | |||||||||||||||||||||||
Securities at amortized cost | 15,729,515 | - | - | - | - | 15,729,515 | (4,274 | ) | 15,725,241 | |||||||||||||||||||||||
Financial assets at FVTOCI (*3) | 28,892,167 | 158,625 | - | - | - | 29,050,792 | (10,192 | ) | 29,050,792 | |||||||||||||||||||||||
Total | 346,759,000 | 20,884,476 | 11,776,942 | 10,941,452 | 1,534,040 | 391,895,910 | (1,979,644 | ) | 389,926,458 | |||||||||||||||||||||||
June 30, 2021 | ||||||||||||||||
Collateral value | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Loans and other financial assets at amortized cost | 197,236,246 | 17,471,180 | 690,363 | 215,397,789 | ||||||||||||
Korean treasury and government agencies | 19,195 | - | - | 19,195 | ||||||||||||
Banks | 1,230,122 | - | - | 1,230,122 | ||||||||||||
Corporates | 69,593,805 | 4,653,583 | 398,205 | 74,645,593 | ||||||||||||
General business | 38,074,043 | 3,192,489 | 314,136 | 41,580,668 | ||||||||||||
Small- and medium-sized enterprise | 28,644,410 | 1,461,094 | 83,854 | 30,189,358 | ||||||||||||
Project financing and others | 2,875,352 | - | 215 | 2,875,567 | ||||||||||||
Consumers | 126,393,124 | 12,817,597 | 292,158 | 139,502,879 | ||||||||||||
Securities at amortized cost | - | - | - | - | ||||||||||||
Financial assets at FVTOCI (*3) | - | - | - | - | ||||||||||||
Total | 197,236,246 | 17,471,180 | 690,363 | 215,397,789 | ||||||||||||
(*1) | Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6. |
(*2) | Credit grade of corporates are BBB- ~ C, and consumers are grades 7 ~ 10. |
(*3) | Financial assets at FVTOCI has been disclosed as the amount before deducting allowance for credit losses because allowance for credit losses does not reduce the carrying amount. |
- 37 -
December 31, 2020 | ||||||||||||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total |
Loss allowance | Total, net | |||||||||||||||||||||||||||
Above appropriate credit rating (*1) |
Less than a limited credit rating (*2) |
Above appropriate credit rating (*1) |
Less than a limited credit rating (*2) | |||||||||||||||||||||||||||||
Loans and other financial assets at amortized cost | 278,729,012 | 21,249,885 | 10,356,251 | 10,143,839 | 1,623,276 | 322,102,263 | (1,996,185 | ) | 320,106,078 | |||||||||||||||||||||||
Korean treasury and government agencies | 9,674,891 | 1,063 | 52,279 | - | - | 9,728,233 | (2,514 | ) | 9,725,719 | |||||||||||||||||||||||
Banks | 19,301,570 | 105,890 | 75,876 | - | 25,598 | 19,508,934 | (15,745 | ) | 19,493,189 | |||||||||||||||||||||||
Corporates | 93,889,922 | 14,873,376 | 1,890,564 | 3,860,389 | 839,234 | 115,353,485 | (1,221,491 | ) | 114,131,994 | |||||||||||||||||||||||
General business | 61,082,336 | 9,013,955 | 1,349,053 | 2,585,868 | 576,078 | 74,607,290 | (869,744 | ) | 73,737,546 | |||||||||||||||||||||||
Small- and medium-sized enterprise | 27,504,992 | 5,415,312 | 538,909 | 1,207,706 | 227,003 | 34,893,922 | (304,077 | ) | 34,589,845 | |||||||||||||||||||||||
Project financing and others | 5,302,594 | 444,109 | 2,602 | 66,815 | 36,153 | 5,852,273 | (47,670 | ) | 5,804,603 | |||||||||||||||||||||||
Consumers | 155,862,629 | 6,269,556 | 8,337,532 | 6,283,450 | 758,444 | 177,511,611 | (756,435 | ) | 176,755,176 | |||||||||||||||||||||||
Securities at amortized cost | 17,025,405 | - | - | - | - | 17,025,405 | (4,566 | ) | 17,020,839 | |||||||||||||||||||||||
Financial assets at FVTOCI (*3) | 28,789,281 | 158,860 | - | - | - | 28,948,141 | (9,631 | ) | 28,948,141 | |||||||||||||||||||||||
Total | 324,543,698 | 21,408,745 | 10,356,251 | 10,143,839 | 1,623,276 | 368,075,809 | (2,010,382 | ) | 366,075,058 | |||||||||||||||||||||||
December 31, 2020 | ||||||||||||||||
Collateral value | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Loans and other financial assets at amortized cost | 187,731,443 | 15,677,871 | 696,709 | 204,106,023 | ||||||||||||
Korean treasury and government agencies | 19,280 | - | - | 19,280 | ||||||||||||
Banks | 1,003,971 | - | - | 1,003,971 | ||||||||||||
Corporates | 62,817,305 | 3,963,101 | 400,340 | 67,180,746 | ||||||||||||
General business | 35,578,470 | 2,670,480 | 271,815 | 38,520,765 | ||||||||||||
Small- and medium-sized enterprise | 25,404,002 | 1,290,941 | 118,265 | 26,813,208 | ||||||||||||
Project financing and others | 1,834,833 | 1,680 | 10,260 | 1,846,773 | ||||||||||||
Consumers | 123,890,887 | 11,714,770 | 296,369 | 135,902,026 | ||||||||||||
Securities at amortized cost | - | - | - | - | ||||||||||||
Financial assets at FVTOCI (*3) | - | - | - | - | ||||||||||||
Total | 187,731,443 | 15,677,871 | 696,709 | 204,106,023 | ||||||||||||
(*1) | Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6. |
(*2) | Credit grade of corporates are BBB- ~ C, and consumers are grades 7 ~ 10. |
(*3) | Financial assets at FVTOCI has been disclosed as the amount before deducting allowance for credit losses because allowance for credit losses does not reduce the carrying amount. |
- 38 -
b) | Guarantees and commitments |
The credit quality of the guarantees and loan commitments as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):
June 30, 2021 | ||||||||||||||||||||||||
Financial assets | Stage 1 | Stage 2 | Stage 3 | Total | ||||||||||||||||||||
Above appropriate credit rating (*1) |
Less than a limited credit rating (*2) |
Above appropriate credit rating (*1) |
Less than a limited credit rating (*2) | |||||||||||||||||||||
Off-balance accounts | ||||||||||||||||||||||||
Guarantees | 11,582,985 | 498,333 | 24,308 | 171,575 | 77,549 | 12,354,750 | ||||||||||||||||||
Loan Commitments | 108,309,688 | 2,766,775 | 2,156,009 | 1,035,607 | 2,725 | 114,270,804 | ||||||||||||||||||
Total | 119,892,673 | 3,265,108 | 2,180,317 | 1,207,182 | 80,274 | 126,625,554 | ||||||||||||||||||
(*1) | Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6. |
(*2) | Credit grade of corporate are BBB- ~ C, and consumers are grades 7 ~ 10. |
December 31, 2020 | ||||||||||||||||||||||||
Financial assets | Stage 1 | Stage 2 | Stage 3 | Total | ||||||||||||||||||||
Above appropriate credit rating (*1) |
Less than a limited credit rating (*2) |
Above appropriate credit rating (*1) |
Less than a limited credit rating (*2) | |||||||||||||||||||||
Off-balance accounts | ||||||||||||||||||||||||
Guarantees | 10,152,900 | 1,382,592 | 11,504 | 191,962 | 70,498 | 11,809,456 | ||||||||||||||||||
Loan Commitments | 105,108,967 | 4,045,595 | 1,951,649 | 977,185 | 5,284 | 112,088,680 | ||||||||||||||||||
Total | 115,261,867 | 5,428,187 | 1,963,153 | 1,169,147 | 75,782 | 123,898,136 | ||||||||||||||||||
(*1) | Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6. |
(*2) | Credit grade of corporate are BBB- ~ C, and consumers are grades 7 ~ 10. |
4) | Collateral and other credit enhancements |
For the six-month period ended June 30, 2021 and for the year ended December 31, 2020, there have been no significant changes in the value of collateral or other credit enhancements held by the Group and there have been no significant changes in collateral or other credit enhancements due to changes in the collateral policy of the Group.
- 39 -
(2) | Market risk |
Market risk is the possible risk of loss arising from trading position and non-trading position as a result of the volatility of market factors such as interest rates, stock prices and foreign exchange rates.
1) | Market risk management |
Market risk management refers to the process of making and implementing decisions for the avoidance, acceptance or mitigation of risks by identifying the underlying source of the risks and measuring its level, and evaluating the appropriateness of the level of accepted market risks.
a) | Trading activities |
The Group uses the standard method and the internally developed model (the Bank) in measuring market risk for trading positions, and allocates market risk capital through the Risk Management Committee. Risk management departments of the Group and its subsidiaries manage limits in detail including those on risk and loss with their management result regularly reported to the Risk Management Committee.
Woori Bank, a subsidiary of the Group, uses the internal model approved by the Financial Supervisory Service to measure the VaR using the Historical Simulation Method based on a 99% confidence level and a 10-day retention period, and calculates the required capital risk for calculating the BIS ratio. For internal management purposes, limit management is performed on a daily basis measuring VaR based on a 99% confidence and 1-day retention period. In addition, Woori Bank perform a daily verification that compares VaR measurement and profit and loss to verify the suitability of the model.
The minimum, maximum and average VaR of the Bank for the six-month period June 30, 2021 and for the year ended December 31, 2020, and the VaR of the Bank as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):
June 30, 2021 |
For the six-month period ended June 30, 2021 |
December 31, 2020 |
For the year ended December 31, 2020 | |||||||||||||||||||||||||||||
Risk factor | Average | Maximum | Minimum | Average | Maximum | Minimum | ||||||||||||||||||||||||||
Interest rate | 4,702 | 5,277 | 14,017 | 2,405 | 6,815 | 7,959 | 15,065 | 2,427 | ||||||||||||||||||||||||
Stock price | 3,955 | 3,350 | 6,423 | 1,797 | 2,283 | 5,783 | 14,394 | 1,982 | ||||||||||||||||||||||||
Foreign currencies | 5,412 | 7,799 | 13,144 | 4,767 | 11,160 | 8,814 | 11,233 | 4,613 | ||||||||||||||||||||||||
Diversification | (7,006 | ) | (8,565 | ) | (19,753 | ) | (3,835 | ) | (11,087 | ) | (11,175 | ) | (18,796 | ) | (3,452 | ) | ||||||||||||||||
Total VaR(*) | 7,063 | 7,861 | 13,831 | 5,134 | 9,171 | 11,381 | 21,896 | 5,570 | ||||||||||||||||||||||||
(*) | VaR (Value at Risk): Retention period of 1-day, Maximum expected losses under 99% level of confidence. |
- 40 -
b) | Non-trading activities |
From the end of 2019 for the Bank and the beginning of 2021 for non-banking subsidiaries, the Bank and its subsidiaries manage and measure interest risk for non-trading activities through DNII(Change in Net Interest Income) and DEVE(Change in Economic Value of Equity) in accordance with IRRBB(Interest Rate Risk in the Banking Book).
DNII represents a change in net interest income that may occur over a certain period (e.g. one year) due to changes in net interest income, and DEVE indicates the economic value changes in equity capital that could be caused by changes in interest rates affecting the present value of asset, liabilities, and others.
DEVE and DNII calculated on interest risk in banking book(IRRBB) basis for assets and liabilities by subsidiary as of the end of June 30, 2021 and December 31, 2020 are as follows(Unit: Korean Won in millions):
June 30, 2021 | December 31, 2020 (*3) | |||||||||||||||
DEVE (*1) |
DNII (*2) |
DEVE (*1) |
DNII (*2) | |||||||||||||
Woori Bank | 865,853 | 51,578 | 634,596 | 66,138 | ||||||||||||
Woori Card Co., Ltd. | 119,363 | 31,024 | - | - | ||||||||||||
Woori Financial Capital Co., Ltd. | 53,691 | 2,433 | - | - | ||||||||||||
Woori Investment Bank Co., Ltd. | 7,442 | 18,171 | - | - | ||||||||||||
Woori Asset Trust Co., Ltd. | 1,642 | 903 | - | - | ||||||||||||
Woori Asset Management Corp. | 1,486 | 265 | - | - | ||||||||||||
Woori Savings Bank | 13,047 | 86 | - | - | ||||||||||||
Woori Private Equity Asset Management Co., Ltd. | 1,367 | 47 | - | - | ||||||||||||
Woori Global Asset Management Co., Ltd. | 353 | 68 | - | - |
(*1) | DEVE: change in Economic Value of Equity |
(*2) | DNII: change in Net Interest Income |
(*3) | As of December 31, 2020, for the remaining subsidiaries except the bank, consolidated trusts, and consolidated subsidiaries of the bank, EVE and NII were not calculated. |
For the remaining subsidiaries except the Bank, consolidated trusts, and consolidated subsidiaries of the Bank as of December 31, 2020, the interest rate EaR and VaR calculated based on the BIS Framework are as follows (Unit: Korean Won in millions):
December 31, 2020 | ||||||||
EaR (*1) | VaR (*2) | |||||||
Woori Card Co., Ltd. | 106,645 | 157,085 | ||||||
Woori Financial Capital Co., Ltd. | 3,701 | 12,550 | ||||||
Woori Investment Bank Co., Ltd. | 1,479 | 5,005 | ||||||
Woori Asset Trust Co., Ltd. | 3,211 | 398 | ||||||
Woori Asset Management Corp. | 64 | 493 | ||||||
Woori Private Equity Asset Management Co., Ltd. | 193 | 37 | ||||||
Woori Global Asset Management Co., Ltd. | 119 | 318 |
(*1) | EaR (Earning at Risk): Change of maximum expected income and expense |
(*2) | VaR (Value at Risk): Maximum expected losses |
- 41 -
The Group estimates and manages risks related to changes in interest rate due to the difference in the maturities of interest-bearing assets and liabilities and discrepancies in the terms of interest rates. Cash flows (both principal and interest), interest bearing assets and liabilities, presented by each re-pricing date, are as follows (Unit: Korean Won in millions):
June 30, 2021 | ||||||||||||||||||||||||||||
Within 3 months |
4 to 6 months |
7 to 9 months |
10 to 12 months |
1 to 5 years |
Over 5 years | Total | ||||||||||||||||||||||
Asset: | ||||||||||||||||||||||||||||
Loans and other financial assets at amortized cost | 185,900,839 | 50,720,981 | 16,577,249 | 16,808,522 | 64,967,665 | 4,504,350 | 339,479,606 | |||||||||||||||||||||
Financial assets at FVTPL | 743,809 | 85,804 | 53,502 | 53,270 | 339,354 | 16,857 | 1,292,596 | |||||||||||||||||||||
Financial assets at FVTOCI | 4,166,280 | 1,972,127 | 2,833,413 | 4,080,867 | 15,978,972 | 551,087 | 29,582,746 | |||||||||||||||||||||
Securities at amortized cost | 1,219,155 | 1,864,315 | 1,120,867 | 952,209 | 9,974,120 | 1,262,559 | 16,393,225 | |||||||||||||||||||||
Total | 192,030,083 | 54,643,227 | 20,585,031 | 21,894,868 | 91,260,111 | 6,334,853 | 386,748,173 | |||||||||||||||||||||
Liability: | ||||||||||||||||||||||||||||
Deposits due to customers | 132,225,484 | 53,393,496 | 38,059,940 | 19,876,450 | 58,716,564 | 59,095 | 302,331,029 | |||||||||||||||||||||
Borrowings | 11,797,382 | 3,164,618 | 1,032,689 | 1,498,079 | 4,710,877 | 463,998 | 22,667,643 | |||||||||||||||||||||
Debentures | 4,317,821 | 3,343,191 | 2,739,535 | 3,306,657 | 25,574,575 | 3,303,981 | 42,585,760 | |||||||||||||||||||||
Total | 148,340,687 | 59,901,305 | 41,832,164 | 24,681,186 | 89,002,016 | 3,827,074 | 367,584,432 | |||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||
Within 3 months |
4 to 6 months |
7 to 9 months |
10 to 12 months |
1 to 5 years |
Over 5 years | Total | ||||||||||||||||||||||
Asset: | ||||||||||||||||||||||||||||
Loans and other financial assets at amortized cost | 177,214,415 | 54,035,826 | 12,410,513 | 11,140,520 | 64,799,854 | 5,170,572 | 324,771,700 | |||||||||||||||||||||
Financial assets at FVTPL | 609,542 | 263,510 | 91,791 | 94,879 | 150,148 | 13,239 | 1,223,109 | |||||||||||||||||||||
Financial assets at FVTOCI | 4,344,718 | 3,339,086 | 3,751,882 | 2,915,238 | 14,648,033 | 473,124 | 29,472,081 | |||||||||||||||||||||
Securities at amortized cost | 1,372,094 | 1,471,309 | 933,715 | 1,869,352 | 11,080,632 | 1,018,002 | 17,745,104 | |||||||||||||||||||||
Total | 183,540,769 | 59,109,731 | 17,187,901 | 16,019,989 | 90,678,667 | 6,674,937 | 373,211,994 | |||||||||||||||||||||
Liability: | ||||||||||||||||||||||||||||
Deposits due to customers | 127,557,303 | 46,471,099 | 35,455,403 | 29,354,652 | 52,395,811 | 50,655 | 291,284,923 | |||||||||||||||||||||
Borrowings | 11,223,338 | 2,832,846 | 1,126,728 | 949,892 | 3,828,384 | 452,495 | 20,413,683 | |||||||||||||||||||||
Debentures | 3,246,233 | 3,396,427 | 3,929,346 | 3,495,915 | 21,899,788 | 3,257,026 | 39,224,735 | |||||||||||||||||||||
Total | 142,026,874 | 52,700,372 | 40,511,477 | 33,800,459 | 78,123,983 | 3,760,176 | 350,923,341 | |||||||||||||||||||||
2) | Currency risk |
Currency risk arises from the financial instruments denominated in foreign currencies other than the functional currency. Therefore, no currency risk arises from non-monetary items or financial instruments denominated in the functional currency.
- 42 -
Financial instruments in foreign currencies exposed to currency risk as of June 30, 2021 and December 31, 2020 are as follows (Unit: USD in millions, JPY in millions, CNY in millions, EUR in millions, and Korean Won in millions):
June 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||
USD | JPY | CNY | EUR | Others | Total | |||||||||||||||||||||||||||||||||||||
Foreign currency |
Korean Won equivalent |
Foreign currency |
Korean Won equivalent |
Foreign currency |
Korean Won equivalent |
Foreign currency |
Korean Won equivalent |
Korean Won equivalent |
Korean Won equivalent | |||||||||||||||||||||||||||||||||
Asset | Cash and cash equivalents | 5,544 | 6,264,205 | 14,286 | 146,557 | 2,607 | 455,813 | 113 | 151,698 | 581,084 | 7,599,357 | |||||||||||||||||||||||||||||||
Loans and other financial assets at amortized cost | 23,994 | 27,113,097 | 153,911 | 1,578,243 | 23,349 | 4,082,294 | 1,943 | 2,612,078 | 5,769,496 | 41,155,208 | ||||||||||||||||||||||||||||||||
Financial assets at FVTPL | 370 | 418,617 | 10,817 | 203,877 | 14 | 2,451 | 369 | 499,227 | 32,939 | 1,157,111 | ||||||||||||||||||||||||||||||||
Financial assets at FVTOCI | 2,745 | 3,101,436 | - | - | 4,658 | 814,484 | 40 | 54,024 | 630,325 | 4,600,269 | ||||||||||||||||||||||||||||||||
Securities at amortized cost | 244 | 275,919 | - | - | 848 | 148,306 | 21 | 27,945 | 123,937 | 576,107 | ||||||||||||||||||||||||||||||||
Total | 32,897 | 37,173,274 | 179,014 | 1,928,677 | 31,476 | 5,503,348 | 2,486 | 3,344,972 | 7,137,781 | 55,088,052 | ||||||||||||||||||||||||||||||||
Liability | Financial liabilities at FVTPL | 352 | 397,497 | 23,954 | 288,145 | - | - | 232 | 312,517 | 154,762 | 1,152,921 | |||||||||||||||||||||||||||||||
Deposits due to customers | 18,573 | 20,988,030 | 223,103 | 2,280,380 | 22,724 | 3,973,125 | 1,374 | 1,846,816 | 4,089,854 | 33,178,205 | ||||||||||||||||||||||||||||||||
Borrowings | 5,061 | 5,719,103 | 10,776 | 158,661 | 1,305 | 228,173 | 446 | 600,023 | 1,577,613 | 8,283,573 | ||||||||||||||||||||||||||||||||
Debentures | 4,040 | 4,564,641 | - | - | - | - | - | - | 338,742 | 4,903,383 | ||||||||||||||||||||||||||||||||
Other financial liabilities | 2,378 | 2,686,674 | 7,463 | 81,094 | 5,877 | 1,027,595 | 202 | 272,021 | 429,277 | 4,496,661 | ||||||||||||||||||||||||||||||||
Total | 30,404 | 34,355,945 | 265,296 | 2,808,280 | 29,906 | 5,228,893 | 2,254 | 3,031,377 | 6,590,248 | 52,014,743 | ||||||||||||||||||||||||||||||||
Off-balance accounts | 8,289 | 9,366,070 | 30,350 | 310,213 | 2,316 | 404,936 | 513 | 689,299 | 725,560 | 11,496,078 | ||||||||||||||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||
USD | JPY | CNY | EUR | Others | Total | |||||||||||||||||||||||||||||||||||||
Foreign currency |
Korean Won equivalent |
Foreign currency |
Korean Won equivalent |
Foreign currency |
Korean Won equivalent |
Foreign currency |
Korean Won equivalent |
Korean Won equivalent |
Korean Won equivalent | |||||||||||||||||||||||||||||||||
Asset | Cash and cash equivalents | 5,584 | 6,074,879 | 22,832 | 240,710 | 4,580 | 764,686 | 115 | 154,154 | 501,900 | 7,736,329 | |||||||||||||||||||||||||||||||
Loans and other financial assets at amortized cost | 21,687 | 23,595,957 | 172,782 | 1,821,554 | 24,230 | 4,045,435 | 2,001 | 2,678,382 | 4,857,438 | 36,998,766 | ||||||||||||||||||||||||||||||||
Financial assets at FVTPL | 280 | 304,146 | 18,855 | 198,781 | 73 | 11,989 | 248 | 332,182 | 88,745 | 935,843 | ||||||||||||||||||||||||||||||||
Financial assets at FVTOCI | 2,741 | 2,981,832 | - | - | 2,601 | 434,258 | 37 | 49,789 | 565,893 | 4,031,772 | ||||||||||||||||||||||||||||||||
Securities at amortized cost | 319 | 347,570 | - | - | - | - | 34 | 45,197 | 115,534 | 508,301 | ||||||||||||||||||||||||||||||||
Total | 30,611 | 33,304,384 | 214,469 | 2,261,045 | 31,484 | 5,256,368 | 2,435 | 3,259,704 | 6,129,510 | 50,211,011 | ||||||||||||||||||||||||||||||||
Liability | Financial liabilities at FVTPL | 426 | 463,678 | 14,493 | 152,792 | - | - | 158 | 211,525 | 115,429 | 943,424 | |||||||||||||||||||||||||||||||
Deposits due to customers | 16,664 | 18,130,448 | 220,153 | 2,320,983 | 26,733 | 4,463,300 | 1,532 | 2,050,400 | 3,443,631 | 30,408,762 | ||||||||||||||||||||||||||||||||
Borrowings | 5,657 | 6,154,464 | 48,446 | 510,750 | - | - | 590 | 789,955 | 697,234 | 8,152,403 | ||||||||||||||||||||||||||||||||
Debentures | 3,973 | 4,322,800 | - | - | - | - | - | - | 444,711 | 4,767,511 | ||||||||||||||||||||||||||||||||
Other financial liabilities | 2,381 | 2,590,147 | 6,705 | 70,690 | 1,853 | 309,319 | 64 | 85,553 | 193,128 | 3,248,837 | ||||||||||||||||||||||||||||||||
Total | 29,101 | 31,661,537 | 289,797 | 3,055,215 | 28,586 | 4,772,619 | 2,344 | 3,137,433 | 4,894,133 | 47,520,937 | ||||||||||||||||||||||||||||||||
Off-balance accounts | 7,441 | 8,095,297 | 24,992 | 263,478 | 3,007 | 502,106 | 533 | 712,846 | 556,988 | 10,130,715 | ||||||||||||||||||||||||||||||||
- 43 -
(3) | Liquidity risk |
Liquidity risk refers to the risk that the Group may encounter difficulties in meeting obligations from its financial liabilities.
1) | Liquidity risk management |
Liquidity risk management is to prevent potential cash shortages as a result of mismatching the use of funds (assets) and sources of funds (liabilities) or unexpected cash outflows. The financial liabilities that are relevant to liquidity risk are incorporated within the scope of risk management. Derivatives instruments are excluded from those financial liabilities as they reflect expected cash flows for a pre-determined period.
Assets and liabilities are grouped by account under Asset Liability Management ('ALM') in accordance with the characteristics of the account. The Group manages liquidity risk by identifying the maturity gap and such gap ratio through various cash flows analysis (i.e. based on remaining maturity and contract period, etc.), while maintaining the gap ratio at or below the target limit.
2) | Maturity analysis of non-derivative financial liabilities |
a) Cash flows of principals and interests by remaining contractual maturities of non-derivative financial liabilities as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):
June 30, 2021 | ||||||||||||||||||||||||||||
Within 3 months |
4 to 6 months |
7 to 9 months |
10 to 12 months |
1 to 5 years |
Over 5 years | Total | ||||||||||||||||||||||
Financial liabilities at FVTPL | 80,452 | 21,069 | 21,927 | 147,028 | - | - | 270,476 | |||||||||||||||||||||
Deposits due to customers | 205,113,826 | 39,145,113 | 25,694,469 | 23,401,034 | 9,267,620 | 1,727,436 | 304,349,498 | |||||||||||||||||||||
Borrowings | 9,742,709 | 3,703,637 | 1,731,057 | 2,158,344 | 4,861,940 | 475,298 | 22,672,985 | |||||||||||||||||||||
Debentures | 4,317,821 | 3,343,191 | 2,739,535 | 3,306,657 | 25,574,575 | 3,303,981 | 42,585,760 | |||||||||||||||||||||
Lease liabilities | 45,250 | 39,167 | 30,682 | 41,017 | 150,566 | 37,238 | 343,920 | |||||||||||||||||||||
Other financial liabilities | 15,726,252 | 64,108 | 14,760 | 31,107 | 615,457 | 1,510,559 | 17,962,243 | |||||||||||||||||||||
Total | 235,026,310 | 46,316,285 | 30,232,430 | 29,085,187 | 40,470,158 | 7,054,512 | 388,184,882 | |||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||
Within 3 months |
4 to 6 months |
7 to 9 months |
10 to 12 months |
1 to 5 years |
Over 5 years | Total | ||||||||||||||||||||||
Financial liabilities at FVTPL | 64,183 | 135,232 | 42,418 | 112,102 | - | - | 353,935 | |||||||||||||||||||||
Deposits due to customers | 191,660,253 | 34,349,298 | 25,213,410 | 31,144,452 | 9,230,904 | 1,793,143 | 293,391,460 | |||||||||||||||||||||
Borrowings | 10,159,819 | 2,524,572 | 1,714,490 | 1,866,810 | 4,177,634 | 463,376 | 20,906,701 | |||||||||||||||||||||
Debentures | 3,246,233 | 3,396,427 | 3,929,346 | 3,495,915 | 21,899,788 | 3,257,228 | 39,224,937 | |||||||||||||||||||||
Lease liabilities | 53,429 | 44,551 | 40,809 | 34,761 | 201,113 | 34,780 | 409,443 | |||||||||||||||||||||
Other financial liabilities | 8,121,978 | 70,277 | 10,294 | 10,897 | 451,096 | 2,142,772 | 10,807,314 | |||||||||||||||||||||
Total | 213,305,895 | 40,520,357 | 30,950,767 | 36,664,937 | 35,960,535 | 7,691,299 | 365,093,790 | |||||||||||||||||||||
- 44 -
b) Cash flows of principals and interests by expected maturities of non-derivative financial liabilities as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):
June 30, 2021 | ||||||||||||||||||||||||||||
Within 3 months |
4 to 6 months |
7 to 9 months |
10 to 12 months |
1 to 5 years |
Over 5 years | Total | ||||||||||||||||||||||
Financial liabilities at FVTPL | 80,452 | 21,069 | 21,927 | 147,028 | - | - | 270,476 | |||||||||||||||||||||
Deposits due to customers | 212,294,262 | 40,187,821 | 24,220,703 | 19,252,790 | 7,886,088 | 109,812 | 303,951,476 | |||||||||||||||||||||
Borrowings | 9,742,709 | 3,703,637 | 1,731,057 | 2,158,344 | 4,861,940 | 475,298 | 22,672,985 | |||||||||||||||||||||
Debentures | 4,317,821 | 3,343,191 | 2,739,535 | 3,306,657 | 25,574,575 | 3,303,981 | 42,585,760 | |||||||||||||||||||||
Lease liabilities | 45,391 | 39,480 | 32,078 | 41,768 | 155,891 | 38,947 | 353,555 | |||||||||||||||||||||
Other financial liabilities | 15,721,019 | 63,646 | 14,951 | 30,385 | 622,564 | 1,510,142 | 17,962,707 | |||||||||||||||||||||
Total | 242,201,654 | 47,358,844 | 28,760,251 | 24,936,972 | 39,101,058 | 5,438,180 | 387,796,959 | |||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||
Within 3 months |
4 to 6 months |
7 to 9 months |
10 to 12 months |
1 to 5 years |
Over 5 years | Total | ||||||||||||||||||||||
Financial liabilities at FVTPL | 68,909 | 131,496 | 41,428 | 112,102 | - | - | 353,935 | |||||||||||||||||||||
Deposits due to customers | 199,931,480 | 35,912,096 | 23,924,403 | 25,477,917 | 7,582,278 | 105,413 | 292,933,587 | |||||||||||||||||||||
Borrowings | 10,159,819 | 2,524,572 | 1,714,490 | 1,866,810 | 4,177,634 | 463,376 | 20,906,701 | |||||||||||||||||||||
Debentures | 3,246,233 | 3,396,427 | 3,929,346 | 3,495,915 | 21,899,788 | 3,257,228 | 39,224,937 | |||||||||||||||||||||
Lease liabilities | 53,429 | 44,894 | 40,949 | 35,074 | 208,125 | 36,950 | 419,421 | |||||||||||||||||||||
Other financial liabilities | 8,121,978 | 70,277 | 10,294 | 10,897 | 451,096 | 2,142,772 | 10,807,314 | |||||||||||||||||||||
Total | 221,581,848 | 42,079,762 | 29,660,910 | 30,998,715 | 34,318,921 | 6,005,739 | 364,645,895 | |||||||||||||||||||||
3) | Maturity analysis of derivative financial liabilities |
Derivatives held for trading purpose are not managed in accordance with their contractual maturity, since the Group holds such financial instruments with the purpose of disposing or redemption before their maturity. As such, those derivatives are incorporated as 'within 3 months' in the table below. Derivatives designated for hedging purpose are estimated by offsetting cash inflows and cash outflows.
The cash flow by the maturity of derivative financial liabilities as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):
Remaining maturity | ||||||||||||||||||||||||||||||||
Within 3 months |
4 to 6 months |
7 to 9 months |
10 to 12 months |
1 to 5 years |
Over 5 years | Total | ||||||||||||||||||||||||||
June 30, 2021 | Cash flow risk hedge | 723 | 595 | (94 | ) | 2,742 | 30,554 | (16 | ) | 34,504 | ||||||||||||||||||||||
Fair value risk hedge | (1,446 | ) | 347 | (1,406 | ) | 418 | 12,548 | - | 10,461 | |||||||||||||||||||||||
Trading purpose | 3,657,360 | - | - | - | - | - | 3,657,360 | |||||||||||||||||||||||||
December 31, 2020 | Cash flow risk hedge | 2,655 | 6,004 | 515 | 239 | 55,744 | - | 65,157 | ||||||||||||||||||||||||
Fair value risk hedge | 255 | (302 | ) | 233 | (287 | ) | 126 | - | 25 | |||||||||||||||||||||||
Trading purpose | 6,460,472 | - | - | - | - | - | 6,460,472 |
4) | Maturity analysis of off-balance accounts (Guarantees loan commitments and others) |
A financial guarantee represents an irrevocable undertaking that the Group should meet a customer's obligations to third parties if the customer fails to do so. The loan commitment represents the limit if the Group has promised a credit to the customer. Commitments to lend include commercial standby facilities and credit lines, liquidity facilities to commercial paper conduits and utilized overdraft facilities. The maximum limit to be paid by the Group in accordance with guarantees and loan commitment only applies to principal amounts. There are contractual maturities for financial guarantees, such as guarantees for debentures issued or loans, unused loan commitments, and other guarantees, however, under the terms of the guarantees and unused loan commitments, funds should be paid upon demand from the counterparty. Details of off-balance accounts are as follows (Unit: Korean Won in millions):
June 30, 2021 | December 31, 2020 | |||||||
Guarantees | 12,354,750 | 11,809,456 | ||||||
Loan commitments | 114,270,804 | 112,088,680 | ||||||
Other commitments | 3,788,926 | 4,933,086 |
- 45 -
(4) | Operational risk |
The Group defines the operational risk that could cause a negative effect on capital resulting from inadequate internal process, labor work and systematic problem or external factors.
1) | Operational risk management |
The Group has established and operated an operating risk management system to strengthen external competitiveness, reduce risk capital volume, enhance operational risk management capacity and prevent accidents through compliance with Basel II, and has obtained approval from the Financial Supervisory Service for 'Advanced Measurement Approaches'(AMA) based on self-compliance verification and independent third-party inspection results.
2) | Operational risk measurement |
The Group is applying the basic indicator method for the purpose of calculating the regulatory capital of operation risk, and the Bank is applying the advanced measurement method. The Bank applies AMA using internal and external loss data, business environment and internal control factors, and scenario analysis.
- 46 -
5. | OPERATING SEGMENTS |
In evaluating the results of the Group and allocating resources, the Group's Chief Operation Decision Maker ('CODM') utilizes the information per type of customers. This financial information of the segments is regularly reviewed by the CODM to make decisions about resources to be allocated to each segment and evaluate its performance.
(1) | Segment by type of organization |
The Group's reporting segments consist of banking, credit card, capital, investment banking and other sectors, and the composition of such reporting segments was divided based on internal report data periodically reviewed by the management to evaluate the performance of the segment and make decisions on the resources to be distributed.
Operational scope | ||
Banking | Loans/deposits, financial services and other relevant services for customers of Woori Bank | |
Credit card | Credit card, cash services, card loans and other relevant services of Woori Card Co., Ltd. | |
Capital | Installments, loans including lease financing and other relevant services of Woori Financial Capital Co., Ltd. | |
Investment banking | Securities operation, sale of financial instruments, project financing and other related services for comprehensive financing of Woori Investment Bank Co., Ltd. | |
Others | Woori Financial Group Inc., Woori Asset Trust Co., Ltd., Woori Asset Management Corp., Ltd., Woori Savings Bank, Woori Credit Information Co., Ltd., Woori Fund Services Inc., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd., Woori FIS Co., Ltd. and Woori Finance Research Institute |
(2) | The details of income (expense) by each segment are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||||||||||
Banking (*1) |
Credit card | Capital |
Investment banking | Others (*2) | Sub-total | Adjustments (*3) | Total | |||||||||||||||||||||||||
Net interest income | 2,455,888 | 289,977 | 144,326 | 51,365 | 12,114 | 2,953,670 | 368,949 | 3,322,619 | ||||||||||||||||||||||||
Non-interest income(expense) | 880,871 | 43,409 | 41,251 | 27,751 | 889,701 | 1,882,983 | (1,161,693 | ) | 721,290 | |||||||||||||||||||||||
Impairment losses due to credit loss | (76,945 | ) | (66,694 | ) | (31,589 | ) | 2,566 | (3,646 | ) | (176,308 | ) | (28,268 | ) | (204,576 | ) | |||||||||||||||||
General and administrative expense | (1,604,531 | ) | (102,815 | ) | (41,224 | ) | (24,014 | ) | (216,169 | ) | (1,988,753 | ) | 133,260 | (1,855,493 | ) | |||||||||||||||||
Net operating income(expense) | 1,655,283 | 163,877 | 112,764 | 57,668 | 682,000 | 2,671,592 | (687,752 | ) | 1,983,840 | |||||||||||||||||||||||
Non-operating income(expense) | 32,073 | (2,701 | ) | (15,851 | ) | (271 | ) | 2,660 | 15,910 | 17,998 | 33,908 | |||||||||||||||||||||
Net income(expense) before tax | 1,687,356 | 161,176 | 96,913 | 57,397 | 684,660 | 2,687,502 | (669,754 | ) | 2,017,748 | |||||||||||||||||||||||
Tax income(expense) | (403,630 | ) | (39,741 | ) | (14,386 | ) | (13,362 | ) | (8,811 | ) | (479,930 | ) | (567 | ) | (480,497 | ) | ||||||||||||||||
Net income(loss) | 1,283,726 | 121,435 | 82,527 | 44,035 | 675,849 | 2,207,572 | (670,321 | ) | 1,537,251 | |||||||||||||||||||||||
Total assets | 393,520,653 | 12,645,157 | 8,761,211 | 4,860,424 | 24,906,508 | 444,693,953 | (23,423,347 | ) | 421,270,606 | |||||||||||||||||||||||
Total liabilities | 369,318,152 | 10,467,730 | 7,831,718 | 4,296,271 | 2,680,272 | 394,594,143 | (1,483,711 | ) | 393,110,432 |
(*1) | The banking sector includes banks and their consolidated subsidiaries (such as overseas subsidiaries) |
(*2) | Other segments include gains and losses from Woori Financial Group Inc., Woori Asset Trust Co., Ltd., Woori Asset Management Corp., Woori Savings Bank, Woori Credit Information Co., Ltd., Woori Fund Service Inc., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd., Woori FIS Co., Ltd. and Woori Finance Research Institute. |
(*3) | Adjustments were made for the presentation of profit or loss in accordance with the Accounting Standards from the reporting segments in accordance with the Managerial Accounting Standards. |
- 47 -
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||||||
Banking (*1) | Credit card |
Investment banking | Others (*2) | Sub-total | Adjustments (*3) | Total | ||||||||||||||||||||||
Net interest income | 2,271,005 | 280,777 | 35,066 | 737 | 2,587,585 | 353,264 | 2,940,849 | |||||||||||||||||||||
Non-interest income(expense) | 721,678 | 16,935 | 18,328 | 864,510 | 1,621,451 | (1,153,465 | ) | 467,986 | ||||||||||||||||||||
Impairment losses due to credit loss | (337,796 | ) | (94,537 | ) | (727 | ) | (211 | ) | (433,271 | ) | (13,408 | ) | (446,679 | ) | ||||||||||||||
General and administrative expense | (1,615,836 | ) | (96,684 | ) | (17,132 | ) | (189,974 | ) | (1,919,626 | ) | 130,068 | (1,789,558 | ) | |||||||||||||||
Net operating income(expense) | 1,039,051 | 106,491 | 35,535 | 675,062 | 1,856,139 | (683,541 | ) | 1,172,598 | ||||||||||||||||||||
Non-operating expense | (125,655 | ) | (2,208 | ) | (294 | ) | (97 | ) | (128,254 | ) | (10,495 | ) | (138,749 | ) | ||||||||||||||
Net income(expense) before tax | 913,396 | 104,283 | 35,241 | 674,965 | 1,727,885 | (694,036 | ) | 1,033,849 | ||||||||||||||||||||
Tax income(expense) | (222,569 | ) | (24,629 | ) | (3,806 | ) | (10,278 | ) | (261,282 | ) | 1,466 | (259,816 | ) | |||||||||||||||
Net income(loss) | 690,827 | 79,654 | 31,435 | 664,687 | 1,466,603 | (692,570 | ) | 774,033 | ||||||||||||||||||||
Total assets (*4) | 374,120,064 | 11,366,596 | 4,332,474 | 31,872,690 | 421,691,824 | (22,610,807 | ) | 399,081,017 | ||||||||||||||||||||
Total liabilities (*4) | 348,706,682 | 9,312,986 | 3,803,594 | 9,606,742 | 371,430,004 | 925,168 | 372,355,172 |
(*1) | Banking includes gains and losses from separate Bank and local subsidiaries abroad. |
(*2) | Other subsidiaries include gains and losses from Woori Financial Group Inc., Woori Asset Trust Co., Ltd., Woori Asset Management Corp., Woori Credit Information Co., Ltd., Woori Fund Service Inc., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd., Woori FIS Co., Ltd. and Woori Finance Research Institute. |
(*3) | Adjustments were made for the presentation of profit or loss in accordance with the Accounting Standards from the reporting segments in accordance with the Managerial Accounting Standards. |
(*4) | Total assets and liabilities are amounts at the end of the previous year. |
(3) | Operating profit or loss from external customers for the six-month periods ended June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||
2021 | 2020 | |||||||
Domestic | 1,834,105 | 1,108,347 | ||||||
Foreign | 149,735 | 64,251 | ||||||
Total | 1,983,840 | 1,172,598 | ||||||
(4) | Major non-current assets as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 (*) | December 31, 2020 (*) | |||||||
Domestic | 5,097,802 | 5,026,161 | ||||||
Foreign | 429,930 | 433,869 | ||||||
Total | 5,527,732 | 5,460,030 | ||||||
(*) | Major non-current assets included investments in joint ventures and associates, investment properties, property, plant and equipment, and intangible assets. |
(5) | Information about major customers |
The Group does not have any single customer that generates 10% or more of the Group's total revenue for the six-month periods ended June 30, 2021 and 2020.
- 48 -
6. | CASH AND CASH EQUIVALENTS |
Details of cash and cash equivalents are as follows (Unit: Korean Won in millions):
June 30, 2021 | December 31, 2020 | |||||||
Cash | 1,847,971 | 1,611,282 | ||||||
Foreign currencies | 477,167 | 514,565 | ||||||
Demand deposits | 7,413,388 | 7,314,353 | ||||||
Fixed deposits | 672,820 | 550,783 | ||||||
Total | 10,411,346 | 9,990,983 | ||||||
7. | FINANCIAL ASSETS AT FVTPL |
(1) | Details of financial assets at FVTPL as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Financial assets at fair value through profit or loss measured at fair value | 12,264,521 | 14,762,941 |
(2) | Financial assets at fair value through profit or loss measured at fair value are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Deposits: | ||||||||
Gold banking asset | 70,150 | 48,796 | ||||||
Securities: | ||||||||
Debt securities | ||||||||
Korean treasury and government agencies | 905,866 | 1,020,418 | ||||||
Financial institutions | 872,516 | 873,031 | ||||||
Corporates | 698,529 | 761,681 | ||||||
Others | 20,013 | 231,967 | ||||||
Equity securities | 458,923 | 485,793 | ||||||
Capital contributions | 987,813 | 865,685 | ||||||
Beneficiary certificates | 3,701,141 | 2,812,558 | ||||||
Others | 93,765 | 84,979 | ||||||
Sub-total | 7,738,566 | 7,136,112 | ||||||
Loans | 431,137 | 676,291 | ||||||
Derivatives assets | 4,024,668 | 6,901,742 | ||||||
Total | 12,264,521 | 14,762,941 | ||||||
The Group does not have financial assets at fair value through profit or loss designated as upon initial recognition as of June 30, 2021 and December 31, 2020.
- 49 -
8. | FINANCIAL ASSETS AT FVTOCI |
(1) | Details of financial assets at FVTOCI as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 |
December 31, 2020 | |||||||
Debt securities: | ||||||||
Korean treasury and government agencies | 4,635,775 | 2,922,671 | ||||||
Financial institutions | 15,467,380 | 17,996,660 | ||||||
Corporates | 3,952,257 | 3,896,744 | ||||||
Bond denominated in foreign currencies | 4,600,217 | 4,031,721 | ||||||
Securities loaned | 395,163 | 100,345 | ||||||
Sub-total | 29,050,792 | 28,948,141 | ||||||
Equity securities | 1,234,099 | 1,080,788 | ||||||
Total | 30,284,891 | 30,028,929 | ||||||
(2) | Details of equity securities designated as financial assets at FVTOCI as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
Purpose of acquisition | June 30, 2021 | December 31, 2020 | Remarks | |||||||||
Investment for strategic business partnership purpose | 847,132 | 778,657 | ||||||||||
Debt-equity swap | 386,961 | 302,090 | ||||||||||
Others | 6 | 41 | Development Trust management purpose, etc. | |||||||||
Total | 1,234,099 | 1,080,788 | ||||||||||
(3) | Changes in the allowance for credit losses and gross carrying amount of financial assets at FVTOCI are as follows (Unit: Korean Won in millions): |
1) | Allowance for credit losses |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | (9,631 | ) | - | - | (9,631 | ) | ||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Net provision of allowance for credit losses | (2,097 | ) | - | - | (2,097 | ) | ||||||||||
Disposal | 1,670 | - | - | 1,670 | ||||||||||||
Others (*) | (134 | ) | - | - | (134 | ) | ||||||||||
Ending balance | (10,192 | ) | - | - | (10,192 | ) | ||||||||||
(*) | Others consist of foreign currencies translation, etc. |
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | (8,569 | ) | - | - | (8,569 | ) | ||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Net provision of allowance for credit losses | (782 | ) | - | - | (782 | ) | ||||||||||
Disposal | 337 | - | - | 337 | ||||||||||||
Others (*) | (170 | ) | - | - | (170 | ) | ||||||||||
Ending balance | (9,184 | ) | - | - | (9,184 | ) | ||||||||||
(*) | Others consist of foreign currencies translation, etc. |
- 50 -
2) | Gross carrying amount |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 28,948,141 | - | - | 28,948,141 | ||||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Acquisition | 13,505,927 | - | - | 13,505,927 | ||||||||||||
Disposal/ Recovery | (13,436,584 | ) | - | - | (13,436,584 | ) | ||||||||||
Loss on valuation | (109,965 | ) | - | - | (109,965 | ) | ||||||||||
Amortization based on effective interest method | (7,024 | ) | - | - | (7,024 | ) | ||||||||||
Others (*) | 150,297 | - | - | 150,297 | ||||||||||||
Ending balance | 29,050,792 | - | - | 29,050,792 | ||||||||||||
(*) | Changes due to foreign currencies translation, etc. |
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 26,795,161 | - | - | 26,795,161 | ||||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Acquisition | 12,879,766 | - | - | 12,879,766 | ||||||||||||
Disposal/ Recovery | (11,051,251 | ) | - | - | (11,051,251 | ) | ||||||||||
Gain on valuation | 114,000 | - | - | 114,000 | ||||||||||||
Amortization based on effective interest method | 4,073 | - | - | 4,073 | ||||||||||||
Others (*) | 63,060 | - | - | 63,060 | ||||||||||||
Ending balance | 28,804,809 | - | - | 28,804,809 | ||||||||||||
(*) | Changes due to foreign currencies translation, etc. |
(4) | During the six-month periods ended June 30, 2021, the Group sold its equity securities, designated as financial assets at FVTOCI in accordance with decision of disposal by the creditors, and the fair values at disposal dates were 84,460 million Won, and cumulative gains at disposal dates were 46,135 million Won. |
9. | SECURITIES AT AMORTIZED COST |
(1) | Details of securities at amortized cost as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Korean treasury and government agencies | 6,959,361 | 6,947,495 | ||||||
Financial institutions | 3,472,495 | 4,843,534 | ||||||
Corporates | 4,721,552 | 4,726,075 | ||||||
Bond denominated in foreign currencies | 576,107 | 508,301 | ||||||
Allowance for credit losses | (4,274 | ) | (4,566 | ) | ||||
Total | 15,725,241 | 17,020,839 | ||||||
- 51 -
(2) | Changes in the allowance for credit losses and gross carrying amount of securities at amortized cost are as follows (Unit: Korean Won in millions): |
1) | Loss allowance |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | (4,566 | ) | - | - | (4,566 | ) | ||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Net reversal of allowance for credit losses | 293 | - | - | 293 | ||||||||||||
Others (*) | (1 | ) | - | - | (1 | ) | ||||||||||
Ending balance | (4,274 | ) | - | - | (4,274 | ) | ||||||||||
(*) | Changes due to foreign currencies translation, etc. |
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | (5,511 | ) | - | - | (5,511 | ) | ||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Net provision of allowance for credit losses | (47 | ) | - | - | (47 | ) | ||||||||||
Others (*) | 1 | - | - | 1 | ||||||||||||
Ending balance | (5,557 | ) | - | - | (5,557 | ) | ||||||||||
(*) | Changes due to foreign currencies translation, etc. |
2) | Gross carrying amount |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 17,025,405 | - | - | 17,025,405 | ||||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Acquisition | 1,496,443 | - | - | 1,496,443 | ||||||||||||
Disposal/ Recovery | (2,812,675 | ) | - | - | (2,812,675 | ) | ||||||||||
Amortization based on effective interest method | 4,416 | - | - | 4,416 | ||||||||||||
Others (*) | 15,926 | - | - | 15,926 | ||||||||||||
Ending balance | 15,729,515 | - | - | 15,729,515 | ||||||||||||
(*) | Changes due to foreign currencies translation, etc. |
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 20,326,050 | - | - | 20,326,050 | ||||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Acquisition | 1,678,871 | - | - | 1,678,871 | ||||||||||||
Disposal/ Recovery | (3,406,644 | ) | - | - | (3,406,644 | ) | ||||||||||
Amortization based on effective interest method | 388 | - | - | 388 | ||||||||||||
Others (*) | 17,494 | - | - | 17,494 | ||||||||||||
Ending balance | 18,616,159 | - | - | 18,616,159 | ||||||||||||
(*) | Changes due to foreign currencies translation, etc. |
- 52 -
10. | LOANS AND OTHER FINANCIAL ASSETS AT AMORTIZED COST |
(1) | Details of loans and other financial assets at amortized cost as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Due from banks | 21,733,419 | 9,863,160 | ||||||
Loans | 313,781,194 | 302,794,182 | ||||||
Other financial assets | 9,635,812 | 7,448,736 | ||||||
Total | 345,150,425 | 320,106,078 | ||||||
(2) | Details of due from banks are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Due from banks in local currency: | ||||||||
Due from Bank of Korea ('BOK') | 17,283,604 | 6,519,226 | ||||||
Due from depository banks | 106,475 | 84,195 | ||||||
Due from non-depository institutions | 6,477 | 266 | ||||||
Due from the Korea Exchange | 162 | 227 | ||||||
Others | 127,625 | 172,914 | ||||||
Loss allowance | (4,094 | ) | (1,576 | ) | ||||
Sub-total | 17,520,249 | 6,775,252 | ||||||
Due from banks in foreign currencies: | ||||||||
Due from banks on demand | 2,692,865 | 1,608,126 | ||||||
Due from banks on time | 207,724 | 296,489 | ||||||
Others | 1,316,117 | 1,186,083 | ||||||
Loss allowance | (3,536 | ) | (2,790 | ) | ||||
Sub-total | 4,213,170 | 3,087,908 | ||||||
Total | 21,733,419 | 9,863,160 | ||||||
(3) | Details of restricted due from banks are as follows (Unit: Korean Won in millions): |
Counterparty | June 30, 2021 | Reason of restriction | ||||||
Due from banks in local currency: | ||||||||
Due from BOK | BOK | 17,283,604 | Reserve deposits under BOK Act | |||||
Due from KSFC | KB Securities Co. Ltd. | 162 | Futures trading margin | |||||
Others | Korea Federation of Savings Banks and others | 81,375 | Guarantees, mortgage of domestic exchange transactions and others | |||||
Sub-total | 17,365,141 | |||||||
Due from banks in foreign currencies: | ||||||||
Due from banks on demand | BOK and others | 2,656,462 | Reserve deposits under BOK Act and others | |||||
Due from banks on time | National Bank Cambodia | 226 | Reserve deposits and others | |||||
Others | Korea Investment & Securities and others | 1,301,770 | Overseas futures and options trade deposits and others | |||||
Sub-total | 3,958,458 | |||||||
Total | 21,323,599 | |||||||
- 53 -
Counterparty | December 31, 2020 | Reason of restriction | ||||||
Due from banks in local currency: | ||||||||
Due from BOK | BOK | 6,519,226 | Reserve deposits under BOK Act | |||||
Due from KSFC | KB Securities Co. Ltd. | 227 | Futures trading margin | |||||
Others | Korea Federation of Savings Banks and others | 89,562 | Guarantees, mortgage of domestic exchange transactions and others | |||||
Sub-total | 6,609,015 | |||||||
Due from banks in foreign currencies: | ||||||||
Due from banks on demand | BOK and others | 1,544,492 | Reserve deposits under BOK Act and others | |||||
Due from banks on time | National Bank Cambodia | 54 | Reserve deposits and others | |||||
Others | Korea Investment & Securities and others | 1,180,570 | Overseas futures and options trade deposits and others | |||||
Sub-total | 2,725,116 | |||||||
Total | 9,334,131 | |||||||
(4) | Changes in the allowance for credit losses and gross carrying amount of due from banks are as follows (Unit: Korean Won in millions): |
1) | Allowance for credit losses |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | (4,366 | ) | - | - | (4,366 | ) | ||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Provision for allowance for credit loss | (3,235 | ) | - | - | (3,235 | ) | ||||||||||
Others (*) | (29 | ) | - | - | (29 | ) | ||||||||||
Ending balance | (7,630 | ) | - | - | (7,630 | ) | ||||||||||
(*) | Changes due to foreign currencies translation, etc. |
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | (4,860 | ) | - | - | (4,860 | ) | ||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Provision for allowance for credit loss | (1,305 | ) | - | - | (1,305 | ) | ||||||||||
Others (*) | 103 | - | - | 103 | ||||||||||||
Ending balance | (6,062 | ) | - | - | (6,062 | ) | ||||||||||
(*) | Changes due to foreign currencies translation, etc. |
- 54 -
2) | Gross carrying amount |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 9,867,526 | - | - | 9,867,526 | ||||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Net increase | 11,845,544 | - | - | 11,845,544 | ||||||||||||
Others (*) | 27,979 | - | - | 27,979 | ||||||||||||
Ending balance | 21,741,049 | - | - | 21,741,049 | ||||||||||||
(*) | Changes due to foreign currencies translation, etc. |
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 14,497,083 | - | - | 14,497,083 | ||||||||||||
Transfer to 12-month expected credit losses | - | - | - | - | ||||||||||||
Transfer to lifetime expected credit losses | - | - | - | - | ||||||||||||
Transfer to credit-impaired financial assets | - | - | - | - | ||||||||||||
Net decrease | (1,523,664 | ) | - | - | (1,523,664 | ) | ||||||||||
Others (*) | (20,148 | ) | - | - | (20,148 | ) | ||||||||||
Ending balance | 12,953,271 | - | - | 12,953,271 | ||||||||||||
(*) | Changes due to foreign currencies translation, etc. |
(5) | Details of loans are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Loans in local currency | 260,510,080 | 249,264,947 | ||||||
Loans in foreign currencies | 21,852,277 | 20,025,092 | ||||||
Domestic banker's usance | 3,099,279 | 2,240,830 | ||||||
Credit card accounts | 9,378,956 | 8,542,619 | ||||||
Bills bought in foreign currencies | 4,993,964 | 5,763,427 | ||||||
Bills bought in local currency | 134,426 | 133,650 | ||||||
Factoring receivables | 40,715 | 38,017 | ||||||
Advances for customers on guarantees | 28,024 | 31,300 | ||||||
Private placement bonds | 604,005 | 353,585 | ||||||
Securitized loans | 2,688,827 | 2,561,914 | ||||||
Call loans | 2,086,802 | 2,352,034 | ||||||
Bonds purchased under resale agreements | 6,139,390 | 10,145,749 | ||||||
Financial lease receivables | 948,026 | 586,216 | ||||||
Installment financial bond | 2,372,550 | 1,925,493 | ||||||
Others | 170 | 380 | ||||||
Loan origination costs and fees | 781,393 | 744,109 | ||||||
Discounted present value | (7,023 | ) | (6,656 | ) | ||||
Allowance for credit losses | (1,870,667 | ) | (1,908,524 | ) | ||||
Total | 313,781,194 | 302,794,182 | ||||||
- 55 -
(6) | Changes in the allowance for credit losses of loans are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||
Consumers | Corporates | |||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Stage 1 | Stage 2 | Stage 3 | |||||||||||||||||||
Beginning balance | (121,527 | ) | (84,463 | ) | (205,693 | ) | (327,460 | ) | (521,907 | ) | (388,744 | ) | ||||||||||||
Transfer to 12-month expected credit losses | (17,090 | ) | 16,288 | 802 | (96,884 | ) | 67,540 | 29,344 | ||||||||||||||||
Transfer to lifetime expected credit losses | 10,008 | (12,300 | ) | 2,292 | 15,840 | (38,334 | ) | 22,494 | ||||||||||||||||
Transfer to credit-impaired financial assets | 2,240 | 14,716 | (16,956 | ) | 1,733 | 24,473 | (26,206 | ) | ||||||||||||||||
Net reversal (provision) of allowance for credit losses | (3,047 | ) | (26,459 | ) | (52,462 | ) | 82,307 | (49,412 | ) | (86,337 | ) | |||||||||||||
Recovery | - | - | (37,106 | ) | - | - | (25,508 | ) | ||||||||||||||||
Charge-off | - | - | 81,855 | - | - | 133,534 | ||||||||||||||||||
Disposal | - | - | 7,224 | - | - | 15,486 | ||||||||||||||||||
Interest income from impaired loans | - | - | 7,126 | - | - | 6,634 | ||||||||||||||||||
Others | 93 | 364 | 3,288 | (7,112 | ) | (2,499 | ) | 6,450 | ||||||||||||||||
Ending balance | (129,323 | ) | (91,854 | ) | (209,630 | ) | (331,576 | ) | (520,139 | ) | (312,853 | ) | ||||||||||||
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||
Credit card accounts | Total | |||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Stage 1 | Stage 2 | Stage 3 | |||||||||||||||||||
Beginning balance | (62,712 | ) | (90,481 | ) | (105,537 | ) | (511,699 | ) | (696,851 | ) | (699,974 | ) | ||||||||||||
Transfer to 12-month expected credit losses | (22,258 | ) | 22,110 | 148 | (136,232 | ) | 105,938 | 30,294 | ||||||||||||||||
Transfer to lifetime expected credit losses | 7,774 | (8,529 | ) | 755 | 33,622 | (59,163 | ) | 25,541 | ||||||||||||||||
Transfer to credit-impaired financial assets | 714 | 3,830 | (4,544 | ) | 4,687 | 43,019 | (47,706 | ) | ||||||||||||||||
Net reversal (provision) of allowance for credit losses | 8,752 | (22,880 | ) | (63,397 | ) | 88,012 | (98,751 | ) | (202,196 | ) | ||||||||||||||
Recovery | - | - | (33,196 | ) | - | - | (95,810 | ) | ||||||||||||||||
Charge-off | - | - | 94,160 | - | - | 309,549 | ||||||||||||||||||
Disposal | - | - | - | - | - | 22,710 | ||||||||||||||||||
Interest income from impaired loans | - | - | - | - | - | 13,760 | ||||||||||||||||||
Others | (1 | ) | - | - | (7,020 | ) | (2,135 | ) | 9,738 | |||||||||||||||
Ending balance | (67,731 | ) | (95,950 | ) | (111,611 | ) | (528,630 | ) | (707,943 | ) | (634,094 | ) | ||||||||||||
- 56 -
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||
Consumers | Corporates | |||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Stage 1 | Stage 2 | Stage 3 | |||||||||||||||||||
Beginning balance | (85,148 | ) | (77,962 | ) | (125,588 | ) | (324,258 | ) | (297,718 | ) | (390,045 | ) | ||||||||||||
Transfer to 12-month expected credit losses | (19,356 | ) | 18,821 | 535 | (30,128 | ) | 22,088 | 8,040 | ||||||||||||||||
Transfer to lifetime expected credit losses | 8,766 | (10,576 | ) | 1,810 | 16,628 | (73,095 | ) | 56,467 | ||||||||||||||||
Transfer to credit-impaired financial assets | 2,225 | 9,617 | (11,842 | ) | 12,976 | 12,525 | (25,501 | ) | ||||||||||||||||
Net reversal (provision) of allowance for credit losses | 6,109 | (13,315 | ) | (61,278 | ) | (74,693 | ) | (30,747 | ) | (142,540 | ) | |||||||||||||
Recovery | - | - | (33,774 | ) | - | - | (43,300 | ) | ||||||||||||||||
Charge-off | - | - | 91,333 | - | - | 101,899 | ||||||||||||||||||
Disposal | 48 | 2 | 346 | - | - | 22,255 | ||||||||||||||||||
Interest income from impaired loans | - | - | 4,735 | - | - | 7,622 | ||||||||||||||||||
Others | (124 | ) | (5 | ) | (131 | ) | (7,593 | ) | (84 | ) | 24,127 | |||||||||||||
Ending balance | (87,480 | ) | (73,418 | ) | (133,854 | ) | (407,068 | ) | (367,031 | ) | (380,976 | ) | ||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||
Credit card accounts | Total | |||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Stage 1 | Stage 2 | Stage 3 | |||||||||||||||||||
Beginning balance | (74,726 | ) | (71,533 | ) | (128,042 | ) | (484,132 | ) | (447,213 | ) | (643,675 | ) | ||||||||||||
Transfer to 12-month expected credit losses | (13,837 | ) | 13,795 | 42 | (63,321 | ) | 54,704 | 8,617 | ||||||||||||||||
Transfer to lifetime expected credit losses | 7,041 | (7,438 | ) | 397 | 32,435 | (91,109 | ) | 58,674 | ||||||||||||||||
Transfer to credit-impaired financial assets | 22,209 | 59,874 | (82,083 | ) | 37,410 | 82,016 | (119,426 | ) | ||||||||||||||||
Net reversal (provision) of allowance for credit losses | (17,597 | ) | (59,668 | ) | (22,731 | ) | (86,181 | ) | (103,730 | ) | (226,549 | ) | ||||||||||||
Recovery | - | - | (31,690 | ) | - | - | (108,764 | ) | ||||||||||||||||
Charge-off | - | - | 138,351 | - | - | 331,583 | ||||||||||||||||||
Disposal | - | - | 23,653 | 48 | 2 | 46,254 | ||||||||||||||||||
Interest income from impaired loans | - | - | - | - | - | 12,357 | ||||||||||||||||||
Others | (2 | ) | - | - | (7,719 | ) | (89 | ) | 23,996 | |||||||||||||||
Ending balance | (76,912 | ) | (64,970 | ) | (102,103 | ) | (571,460 | ) | (505,419 | ) | (616,933 | ) | ||||||||||||
- 57 -
(7) | Changes in the gross carrying amount of loans are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||
Consumers | Corporates | |||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Stage 1 | Stage 2 | Stage 3 | |||||||||||||||||||
Beginning balance | 125,990,038 | 12,016,711 | 537,106 | 149,574,932 | 7,328,741 | 717,909 | ||||||||||||||||||
Transfer to 12-month expected credit losses | 3,730,443 | (3,721,667 | ) | (8,776 | ) | 1,534,004 | (1,501,081 | ) | (32,923 | ) | ||||||||||||||
Transfer to lifetime expected credit losses | (6,030,431 | ) | 6,053,085 | (22,654 | ) | (3,097,859 | ) | 3,143,555 | (45,696 | ) | ||||||||||||||
Transfer to credit-impaired financial assets | (64,415 | ) | (86,834 | ) | 151,249 | (166,253 | ) | (149,253 | ) | 315,506 | ||||||||||||||
Charge-off | - | - | (81,855 | ) | - | - | (133,534 | ) | ||||||||||||||||
Disposal | - | - | (26,261 | ) | - | - | (66,527 | ) | ||||||||||||||||
Net increase (decrease) | 4,935,139 | (931,914 | ) | (25,244 | ) | 7,239,175 | (673,197 | ) | (122,212 | ) | ||||||||||||||
Ending balance | 128,560,774 | 13,329,381 | 523,565 | 155,083,999 | 8,148,765 | 632,523 | ||||||||||||||||||
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||
Credit card accounts | Total | |||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Stage 1 | Stage 2 | Stage 3 | |||||||||||||||||||
Beginning balance | 7,278,975 | 1,078,220 | 180,074 | 282,843,945 | 20,423,672 | 1,435,089 | ||||||||||||||||||
Transfer to 12-month expected credit losses | 307,122 | (306,941 | ) | (181 | ) | 5,571,569 | (5,529,689 | ) | (41,880 | ) | ||||||||||||||
Transfer to lifetime expected credit losses | (473,197 | ) | 474,086 | (889 | ) | (9,601,487 | ) | 9,670,726 | (69,239 | ) | ||||||||||||||
Transfer to credit-impaired financial assets | (27,962 | ) | (27,424 | ) | 55,386 | (258,630 | ) | (263,511 | ) | 522,141 | ||||||||||||||
Charge-off | - | - | (94,160 | ) | - | - | (309,549 | ) | ||||||||||||||||
Disposal | - | - | - | - | - | (92,788 | ) | |||||||||||||||||
Net increase (decrease) | 973,542 | (88,350 | ) | 44,553 | 13,147,856 | (1,693,461 | ) | (102,903 | ) | |||||||||||||||
Ending balance | 8,058,480 | 1,129,591 | 184,783 | 291,703,253 | 22,607,737 | 1,340,871 | ||||||||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||
Consumers | Corporates | |||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Stage 1 | Stage 2 | Stage 3 | |||||||||||||||||||
Beginning balance | 111,253,283 | 12,448,807 | 417,674 | 134,443,979 | 4,910,598 | 740,257 | ||||||||||||||||||
Transfer to 12-month expected credit losses | 4,318,903 | (4,310,929 | ) | (7,974 | ) | 1,067,885 | (1,046,149 | ) | (21,736 | ) | ||||||||||||||
Transfer to lifetime expected credit losses | (4,980,916 | ) | 5,002,670 | (21,754 | ) | (2,571,677 | ) | 2,646,989 | (75,312 | ) | ||||||||||||||
Transfer to credit-impaired financial assets | (77,204 | ) | (118,765 | ) | 195,969 | (235,257 | ) | (115,332 | ) | 350,589 | ||||||||||||||
Charge-off | - | - | (91,333 | ) | - | - | (101,899 | ) | ||||||||||||||||
Disposal | (3,920,591 | ) | (3,971 | ) | (16,378 | ) | - | - | (42,390 | ) | ||||||||||||||
Net increase (decrease) | 8,332,255 | (1,442,779 | ) | (35,155 | ) | 8,840,031 | (833,148 | ) | (105,787 | ) | ||||||||||||||
Ending balance | 114,925,730 | 11,575,033 | 441,049 | 141,544,961 | 5,562,958 | 743,722 | ||||||||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||
Credit card accounts | Total | |||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Stage 1 | Stage 2 | Stage 3 | |||||||||||||||||||
Beginning balance | 7,278,467 | 885,832 | 228,367 | 252,975,729 | 18,245,237 | 1,386,298 | ||||||||||||||||||
Transfer to 12-month expected credit losses | 266,322 | (266,266 | ) | (56 | ) | 5,653,110 | (5,623,344 | ) | (29,766 | ) | ||||||||||||||
Transfer to lifetime expected credit losses | (305,371 | ) | 305,870 | (499 | ) | (7,857,964 | ) | 7,955,529 | (97,565 | ) | ||||||||||||||
Transfer to credit-impaired financial assets | (51,913 | ) | (75,435 | ) | 127,348 | (364,374 | ) | (309,532 | ) | 673,906 | ||||||||||||||
Charge-off | - | - | (138,351 | ) | - | - | (331,583 | ) | ||||||||||||||||
Disposal | - | - | (43,781 | ) | (3,920,591 | ) | (3,971 | ) | (102,549 | ) | ||||||||||||||
Net increase (decrease) | (296,819 | ) | (50,674 | ) | 9,399 | 16,875,467 | (2,326,601 | ) | (131,543 | ) | ||||||||||||||
Ending balance | 6,890,686 | 799,327 | 182,427 | 263,361,377 | 17,937,318 | 1,367,198 | ||||||||||||||||||
(8) | Details of other financial assets are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Cash Management Account asset (CMA asset) | 215,000 | 210,000 | ||||||
Receivables | 6,325,406 | 3,809,929 | ||||||
Accrued income | 934,797 | 864,107 | ||||||
Telex and telephone subscription rights and refundable deposits | 885,906 | 936,878 | ||||||
Domestic exchange settlement debit | 1,149,524 | 1,518,775 | ||||||
Other assets | 212,060 | 192,342 | ||||||
Allowance for credit losses | (86,881 | ) | (83,295 | ) | ||||
Total | 9,635,812 | 7,448,736 | ||||||
- 58 -
(9) | Changes in the allowances for credit losses on other financial assets are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | (3,666 | ) | (5,450 | ) | (74,179 | ) | (83,295 | ) | ||||||||
Transfer to 12-month expected credit losses | (204 | ) | 196 | 8 | - | |||||||||||
Transfer to lifetime expected credit losses | 156 | (173 | ) | 17 | - | |||||||||||
Transfer to credit-impaired financial assets | 178 | 414 | (592 | ) | - | |||||||||||
Reversal (Provision) of allowance for credit losses | 564 | (930 | ) | (4,179 | ) | (4,545 | ) | |||||||||
Charge-off | - | - | 987 | 987 | ||||||||||||
Disposal | - | - | 557 | 557 | ||||||||||||
Others | (1,873 | ) | (4 | ) | 1,292 | (585 | ) | |||||||||
Ending balance | (4,845 | ) | (5,947 | ) | (76,089 | ) | (86,881 | ) | ||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | (3,196 | ) | (1,666 | ) | (72,277 | ) | (77,139 | ) | ||||||||
Transfer to 12-month expected credit losses | (140 | ) | 131 | 9 | - | |||||||||||
Transfer to lifetime expected credit losses | 536 | (150 | ) | (386 | ) | - | ||||||||||
Transfer to credit-impaired financial assets | 26 | 142 | (168 | ) | - | |||||||||||
Provision of allowance for credit losses | (767 | ) | (262 | ) | (3,272 | ) | (4,301 | ) | ||||||||
Charge-off | - | - | 248 | 248 | ||||||||||||
Disposal | - | - | 489 | 489 | ||||||||||||
Others | 545 | - | (11 | ) | 534 | |||||||||||
Ending balance | (2,996 | ) | (1,805 | ) | (75,368 | ) | (80,169 | ) | ||||||||
(10) | Changes in the gross carrying amount of other financial assets are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 7,267,426 | 76,418 | 188,187 | 7,532,031 | ||||||||||||
Transfer to 12-month expected credit losses | 7,997 | (7,984 | ) | (13 | ) | - | ||||||||||
Transfer to lifetime expected credit losses | (13,729 | ) | 13,759 | (30 | ) | - | ||||||||||
Transfer to credit-impaired financial assets | (800 | ) | (1,038 | ) | 1,838 | - | ||||||||||
Charge-off | - | - | (987 | ) | (987 | ) | ||||||||||
Disposal | - | - | (686 | ) | (686 | ) | ||||||||||
Net increase (decrease) | 2,157,975 | 26,038 | 8,322 | 2,192,335 | ||||||||||||
Ending balance | 9,418,869 | 107,193 | 196,631 | 9,722,693 | ||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 8,059,844 | 92,647 | 117,874 | 8,270,365 | ||||||||||||
Transfer to 12-month expected credit losses | 8,420 | (8,404 | ) | (16 | ) | - | ||||||||||
Transfer to lifetime expected credit losses | (12,735 | ) | 12,752 | (17 | ) | - | ||||||||||
Transfer to credit-impaired financial assets | (1,743 | ) | (1,096 | ) | 2,839 | - | ||||||||||
Charge-off | - | - | (248 | ) | (248 | ) | ||||||||||
Disposal | - | - | (549 | ) | (549 | ) | ||||||||||
Net increase (decrease) | 4,288,900 | (31,361 | ) | 51,841 | 4,309,380 | |||||||||||
Ending balance | 12,342,686 | 64,538 | 171,724 | 12,578,948 | ||||||||||||
- 59 -
11. | FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES |
(1) | The fair value hierarchy |
The fair value hierarchy for financial instruments is determined by the amount of observable market data. The specific financial instruments characteristics and market condition such as the existence of the transactions among market participants and transparency are reflected to the market observable inputs. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities. The Group maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value of its financial assets and financial liabilities. Fair value is measured based on the perspective of a market participant. As such, even when market assumptions are not readily available, the Group's own assumptions reflect those that market participants would use for measuring the assets or liabilities at the measurement date.
The fair value measurement is described in the one of the following three levels used to classify fair value measurements:
• | Level 1-fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities. The types of financial assets or liabilities generally included in Level 1 are publicly traded equity securities, derivatives, and debt securities issued by governmental bodies. |
• | Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. derived from prices). The types of financial assets or liabilities generally included in Level 2 are debt securities not traded in active markets and derivatives traded in OTC but not required significant judgment. |
• | Level 3- fair value measurements are those derived from valuation technique that include inputs for the assets or liabilities that are not based on observable market data (unobservable inputs). The types of financial assets or liabilities generally included in Level 3 are non-public securities and derivatives and debt securities of which valuation techniques require significant judgments and subjectivity. |
The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Group's assessment of the significance of a particular input to a fair value measurement in its entirety requires judgment and consideration of inherent factors of the asset or liability.
- 60 -
(2) | Fair value hierarchy of financial assets and liabilities measured at fair value are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||
Level 1 (*) | Level 2 (*) | Level 3 | Total | |||||||||||||
Financial assets: | ||||||||||||||||
Financial assets at FVTPL | ||||||||||||||||
Deposits | 70,150 | - | - | 70,150 | ||||||||||||
Debt securities | 717,328 | 1,775,743 | 3,853 | 2,496,924 | ||||||||||||
Equity securities | 32,950 | - | 425,973 | 458,923 | ||||||||||||
Capital contributions | - | - | 987,813 | 987,813 | ||||||||||||
Beneficiary certificates | 31,313 | 1,635,007 | 2,034,821 | 3,701,141 | ||||||||||||
Loans | - | 139,666 | 291,471 | 431,137 | ||||||||||||
Derivative assets (Designated for trading) | 2,702 | 4,021,433 | 533 | 4,024,668 | ||||||||||||
Others | - | - | 93,765 | 93,765 | ||||||||||||
Sub-total | 854,443 | 7,571,849 | 3,838,229 | 12,264,521 | ||||||||||||
Financial assets at FVTOCI | ||||||||||||||||
Debt securities | 5,240,322 | 23,810,470 | - | 29,050,792 | ||||||||||||
Equity securities | 664,816 | - | 569,283 | 1,234,099 | ||||||||||||
Sub-total | 5,905,138 | 23,810,470 | 569,283 | 30,284,891 | ||||||||||||
Derivative assets (Designated for hedging) | - | 129,562 | - | 129,562 | ||||||||||||
Total | 6,759,581 | 31,511,881 | 4,407,512 | 42,678,974 | ||||||||||||
Financial liabilities: | ||||||||||||||||
Financial liabilities at FVTPL | ||||||||||||||||
Deposits due to customers | 70,394 | - | - | 70,394 | ||||||||||||
Derivative liabilities (Designated for trading) | 4,867 | 3,630,190 | 22,647 | 3,657,704 | ||||||||||||
Securities sold | 200,083 | - | - | 200,083 | ||||||||||||
Sub-total | 275,344 | 3,630,190 | 22,647 | 3,928,181 | ||||||||||||
Derivative liabilities (Designated for hedging) | - | 44,045 | - | 44,045 | ||||||||||||
Total | 275,344 | 3,674,235 | 22,647 | 3,972,226 | ||||||||||||
(*) | There were no transfers between Level 1 and Level 2 of financial assets and liabilities measured at fair value. The Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions have changed. |
- 61 -
December 31, 2020 | ||||||||||||||||
Level 1 (*) | Level 2 (*) | Level 3 | Total | |||||||||||||
Financial assets: | ||||||||||||||||
Financial assets at FVTPL | ||||||||||||||||
Deposits | 48,796 | - | - | 48,796 | ||||||||||||
Debt securities | 516,597 | 2,365,882 | 4,618 | 2,887,097 | ||||||||||||
Equity securities | 35,422 | - | 450,371 | 485,793 | ||||||||||||
Capital contributions | - | - | 865,685 | 865,685 | ||||||||||||
Beneficiary certificates | 24,895 | 869,852 | 1,917,811 | 2,812,558 | ||||||||||||
Loans | - | 467,229 | 209,062 | 676,291 | ||||||||||||
Derivative assets (Designated for trading) | 18,416 | 6,875,454 | 7,872 | 6,901,742 | ||||||||||||
Others | - | - | 84,979 | 84,979 | ||||||||||||
Sub-total | 644,126 | 10,578,417 | 3,540,398 | 14,762,941 | ||||||||||||
Financial assets at FVTOCI | ||||||||||||||||
Debt securities | 3,092,237 | 25,855,904 | - | 28,948,141 | ||||||||||||
Equity securities | 510,073 | - | 570,715 | 1,080,788 | ||||||||||||
Sub-total | 3,602,310 | 25,855,904 | 570,715 | 30,028,929 | ||||||||||||
Derivative assets (Designated for hedging) | - | 174,820 | - | 174,820 | ||||||||||||
Total | 4,246,436 | 36,609,141 | 4,111,113 | 44,966,690 | ||||||||||||
Financial liabilities: | ||||||||||||||||
Financial liabilities at FVTPL | ||||||||||||||||
Deposits due to customers | 49,279 | - | - | 49,279 | ||||||||||||
Derivative liabilities (Designated for trading) | 6,024 | 6,433,727 | 20,136 | 6,459,887 | ||||||||||||
Securities sold | 285,026 | - | - | 285,026 | ||||||||||||
Sub-total | 340,329 | 6,433,727 | 20,136 | 6,794,192 | ||||||||||||
Financial liabilities at FVTPL designated as upon initial recognition | ||||||||||||||||
Equity-linked securities | - | - | 19,630 | 19,630 | ||||||||||||
Derivative liabilities (Designated for hedging) | - | 64,769 | - | 64,769 | ||||||||||||
Total | 340,329 | 6,498,496 | 39,766 | 6,878,591 | ||||||||||||
(*) | There were no transfers between Level 1 and Level 2 of financial assets and liabilities measured at fair value. The Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions have changed. |
- 62 -
Financial assets and liabilities at FVTPL, financial liabilities at FVTPL designated as upon initial recognition, financial assets at FVTOCI, and derivative assets and liabilities are recognized at fair value. Fair value is the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date.
Financial instruments are measured at fair value using a quoted market price in active markets. If there is no active market for a financial instrument, the Group determines the fair value using valuation methods. Valuation methods and input variables for each type of financial instruments are as follows:
1) | Valuation methods and input variables for each type of financial instrument classified into level 2 in June 30, 2021 and December 31, 2020 are as follows: |
Valuation methods | Input variables | |||
Debt securities | Fair value is measured by discounting the future cash flows of debt securities applying the risk-free market rate with credit spread. | Risk-free market rate and credit spread | ||
Beneficiary certificates | The beneficiary certificates classified as Level 2 are MMF and are measured at the standard price. | Standard price | ||
Derivatives | Fair value is measured by models such as option model (Closed form), DCF model, FDM and Monte Carlo Simulation. | Discount rate, values of underlying assets such as foreign exchange rate and stock prices, volatility, risk-free market rate, forward rate, etc. | ||
Loans | The future cash flows of debt instruments are measured at a discount by applying the market interest rate applied to entities with similar creditworthiness to the debtor. | Risk-free market rate and credit spread |
2) | Valuation methods and input variables for each type of financial instrument classified into level 3 in June 30, 2021 and December 31, 2020 are as follows: |
Valuation methods | Input variables | |||
Loans | Fair value is calculated by using the Binomial Tree, which is a valuation technique commonly used in the market taking into account the price and variability of the underlying asset, and LSMC. The future cash flows of debt instruments are measured at a discount by applying the market interest rate applied to entities with similar creditworthiness to the debtor. | Values of underlying assets, volatility, risk-free market rate and credit spread | ||
Debt securities | The future cash flows of debt instruments are measured at a discount by applying the market interest rate applied to entities with similar creditworthiness to debt securities issuers. | Risk-free market rate and credit spread | ||
Equity securities, capital contributions and Beneficiary certificates | Among DCF (Discounted Cash Flow) Model, FCFE (Free Cash Flow to Equity) Model, Comparable Company Analysis, Dividend Discount Model, Risk-adjusted Rate of Return Method, Net Asset Value Method, LSMC, and Binomial Tree, more than one method is used given the characteristic of the subject of fair value measurement. | Risk-free market rate, market risk premium, corporate Beta, stock prices, volatility of underlying asset, net asset of the investment association and discount rate | ||
Derivatives | Fair value is measured by models such as option model (Closed form), DCF model, FDM and Monte Carlo Simulation. | Risk-free market rate, discount rate, values of underlying assets such as foreign exchange rate and stock prices, volatility, etc. | ||
Others | Fair value is measured by DCF model, LSMC, etc. | Stock prices, volatility of underlying assets, etc. |
- 63 -
Valuation methods of financial assets and liabilities measured at fair value and classified into Level 3 and significant but unobservable inputs are as follows:
Fair value | Type | Input variable | Range(%) |
Impact of changes in significant | ||||||
Loans | Binomial Tree | Stock prices, Volatility of underlying asset | 34.96% | Variation of fair value increases as volatility of underlying asset increases. | ||||||
LSMC | Stock prices, Volatility of underlying asset | 16.63% | Variation of fair value increases as volatility of underlying asset increases. | |||||||
Derivative assets | Option valuation model and others | Interest rate related | Correlation coefficient | 0.90~0.98 | Variation of fair value increases as correlation coefficient increases. | |||||
Volatility of underlying asset | 21.78~103.13% | Variation of fair value increases as volatility of underlying assets increases. | ||||||||
Equity related | Correlation coefficient | 0.25~0.76 | Variation of fair value increases as correlation coefficient increases. | |||||||
Volatility of underlying asset | - | Variation of fair value increases as volatility of underlying assets increases. | ||||||||
DCF model | Interest rate related | Credit risk adjustment ratio | 100.00% | Variation of fair value decreases as credit risk adjustment ratio increases. | ||||||
Derivative liabilities | Option valuation model and others | Interest rate related | Correlation coefficient | 0.90~0.98 | Variation of fair value increases as correlation coefficient increases. | |||||
Volatility of underlying asset | 21.78~103.13% | Variation of fair value increases as volatility of underlying assets increases. | ||||||||
Equity related | Correlation coefficient | 0.25~0.76 | Variation of fair value increases as correlation coefficient increases. | |||||||
Volatility of underlying asset | - | Variation of fair value increases as volatility of underlying assets increases. | ||||||||
Equity securities, capital contributions, and beneficiary certificates | LSMC | Stock prices, Volatility of underlying asset | 17.20% | Variation of fair value increases as volatility of underlying asset increases. | ||||||
DCF model and others | Discount rate | 0.00~37.98% | Fair value increases as discount rate decreases. | |||||||
Terminal growth rate | 1.00% | Fair value increases as terminal growth rate increases. | ||||||||
Liquidation value | 0.00% | Variation of liquidation value increases as volatility of underlying assets increases |
- 64 -
Fair value | Type | Input variable | Range(%) |
Impact of changes in significant | ||||||
Others | Income approach | Discount rate | 12.69% | Fair value increases as discount rate decreases. | ||||||
Growth rate | 1.00% | Fair value increases as growth rate increases. | ||||||||
LSMC | Stock prices, Volatility of underlying asset | 16.63~37.31% | Variation of fair value increases as volatility of underlying asset increases. |
Fair value of financial assets and liabilities classified into Level 3 is measured by the Group using its own valuation methods or using external specialists. Unobservable inputs used in the fair value measurements are produced by the internal system of the Group, and the appropriateness of inputs is reviewed regularly.
(3) | Changes in financial assets and liabilities measured at fair value classified into Level 3 are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||||||
Beginning balance |
Net Income (loss) (*1) |
Other comprehensive income |
Purchases/ issuances |
Disposals / settlements |
Transfer to or out of Level 3 (*2) |
Ending balance | ||||||||||||||||||||||
Financial assets: | ||||||||||||||||||||||||||||
Financial assets at FVTPL | ||||||||||||||||||||||||||||
Debt securities | 4,618 | (765 | ) | - | - | - | - | 3,853 | ||||||||||||||||||||
Equity securities | 450,371 | (12,065 | ) | - | 13,083 | (25,416 | ) | - | 425,973 | |||||||||||||||||||
Capital contributions | 865,685 | 35,844 | - | 209,861 | (123,577 | ) | - | 987,813 | ||||||||||||||||||||
Beneficiary certificates | 1,917,811 | 23,203 | - | 166,461 | (72,654 | ) | - | 2,034,821 | ||||||||||||||||||||
Loans | 209,062 | 9,231 | - | 444,975 | (371,797 | ) | - | 291,471 | ||||||||||||||||||||
Derivative assets | 7,872 | (243 | ) | - | 512 | (1,770 | ) | (5,838 | ) | 533 | ||||||||||||||||||
Others | 84,979 | 6,944 | - | 6,998 | (5,156 | ) | - | 93,765 | ||||||||||||||||||||
Sub-total | 3,540,398 | 62,149 | - | 841,890 | (600,370 | ) | (5,838 | ) | 3,838,229 | |||||||||||||||||||
Financial assets at FVTOCI | ||||||||||||||||||||||||||||
Equity securities | 570,715 | - | (1,555 | ) | 242 | (119 | ) | - | 569,283 | |||||||||||||||||||
Total | 4,111,113 | 62,149 | (1,555 | ) | 842,132 | (600,489 | ) | (5,838 | ) | 4,407,512 | ||||||||||||||||||
Financial liabilities: | ||||||||||||||||||||||||||||
Financial liabilities at FVTPL | ||||||||||||||||||||||||||||
Derivative liabilities | 20,136 | 25,916 | - | (4,642 | ) | (12,509 | ) | (6,254 | ) | 22,647 | ||||||||||||||||||
Financial liabilities at FVTPL designated as upon initial recognition | ||||||||||||||||||||||||||||
Equity-linked securities | 19,630 | (102 | ) | - | - | (19,528 | ) | - | - | |||||||||||||||||||
Derivative liabilities (Designated for hedging) | - | - | - | - | - | - | - | |||||||||||||||||||||
Total | 39,766 | 25,814 | - | (4,642 | ) | (32,037 | ) | (6,254 | ) | 22,647 | ||||||||||||||||||
(*1) | The losses that increase financial liabilities are presented as positive amounts, and the gains that decrease financial liabilities are presented as negative amounts. The gain amounting to 27,221 million Won for the six-month period ended June 30, 2021, which is from financial assets and liabilities that the Group holds as at the end of the period, has been recognized in net gain(loss) on financial assets at FVTPL and net gain(loss) on financial assets at FVTOCI in the consolidated statement of comprehensive income. |
(*2) | The Group recognizes transfers between levels at the end of reporting period within such events have occurred or conditions have changed. |
- 65 -
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||||||
Beginning balance |
Net Income (loss) (*1) |
Other comprehensive income |
Purchases/ issuances |
Disposals / settlements |
Transfer to or out of Level 3 (*2) |
Ending balance | ||||||||||||||||||||||
Financial assets: | ||||||||||||||||||||||||||||
Financial assets at FVTPL | ||||||||||||||||||||||||||||
Debt securities | 5,826 | (9 | ) | - | - | (52 | ) | - | 5,765 | |||||||||||||||||||
Equity securities | 528,621 | 13,220 | - | 10,472 | (13,714 | ) | 31 | 538,630 | ||||||||||||||||||||
Capital contributions | 515,199 | 12,324 | - | 98,219 | (12,006 | ) | - | 613,736 | ||||||||||||||||||||
Beneficiary certificates | 1,275,734 | 15,939 | - | 315,069 | (138,319 | ) | - | 1,468,423 | ||||||||||||||||||||
Loans | 152,629 | 4,556 | - | 93,987 | (62,274 | ) | - | 188,898 | ||||||||||||||||||||
Derivative assets | 25,048 | 95,112 | - | 10,891 | (19,233 | ) | (8,387 | ) | 103,431 | |||||||||||||||||||
Sub-total | 2,503,057 | 141,142 | - | 528,638 | (245,598 | ) | (8,356 | ) | 2,918,883 | |||||||||||||||||||
Financial assets at FVTOCI | ||||||||||||||||||||||||||||
Equity securities | 493,698 | - | (56,593 | ) | 3,698 | (630 | ) | 2,192 | 442,365 | |||||||||||||||||||
Total | 2,996,755 | 141,142 | (56,593 | ) | 532,336 | (246,228 | ) | (6,164 | ) | 3,361,248 | ||||||||||||||||||
Financial liabilities: | ||||||||||||||||||||||||||||
Financial liabilities at FVTPL | ||||||||||||||||||||||||||||
Derivative liabilities | 72,039 | 495 | - | 11,001 | (49,806 | ) | (14,308 | ) | 19,421 | |||||||||||||||||||
Financial liabilities at FVTPL designated as upon initial recognition | ||||||||||||||||||||||||||||
Equity-linked securities | 87,626 | (8,421 | ) | - | - | (54,719 | ) | - | 24,486 | |||||||||||||||||||
Derivative liabilities (Designated for hedging) | 321 | - | - | - | (321 | ) | - | - | ||||||||||||||||||||
Total | 159,986 | (7,926 | ) | - | 11,001 | (104,846 | ) | (14,308 | ) | 43,907 | ||||||||||||||||||
(*1) | The losses that increase financial liabilities are presented as positive amounts, and the gains that decrease financial liabilities are presented as negative amounts. The gain amounting to 140,315 million Won for the six-month period ended June 30, 2020, which is from financial assets and liabilities that the Group holds as at the end of the period, has been recognized in net gain(loss) on financial assets at FVTPL and net gain(loss) on financial assets at FVTOCI in the consolidated statement of comprehensive income. |
(*2) | The Group recognizes transfers between levels at the end of reporting period within such events have occurred or conditions have changed. |
- 66 -
(4) | Sensitivity analysis results on reasonable fluctuation of the significant unobservable input variables for the fair value of Level 3 financial instruments are as follows. |
The sensitivity analysis of the financial instruments has been performed by classifying with favorable and unfavorable changes based on how changes in unobservable assumptions would have effects on the fluctuations of financial instruments' value. When the fair value of a financial instrument is affected by more than one unobservable assumption, the below table reflects the most favorable or the most unfavorable changes which resulted from varying the assumptions individually. The sensitivity analysis was performed for two types of level 3 financial instruments: (1) interest rate related derivatives, currency related derivatives, equity related derivatives, equity-linked securities beneficiary certificates and loans of which fair value changes are recognized as net income; (2) equity securities of which fair value changes are recognized as other comprehensive income.
Meanwhile, among the financial instruments that are classified as Level 3 amounting to 4,430,159 million Won and 4,150,879 million Won as of June 30, 2021 and December 31, 2020 respectively, equity instruments of 3,270,072 million Won and 3,052,432 million Won whose carrying amount are considered to represent the reasonable approximation of fair value are excluded from the sensitivity analysis.
The sensitivity on fluctuation of input variables by financial instruments as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):
June 30, 2021 | ||||||||||||||||
Net income (loss) | Other comprehensive income (loss) | |||||||||||||||
Favorable | Unfavorable | Favorable | Unfavorable | |||||||||||||
Financial assets: | ||||||||||||||||
Financial assets at FVTPL | ||||||||||||||||
Derivative assets (*1) | 620 | 97 | - | - | ||||||||||||
Loans (*2) | 1,490 | (1,466 | ) | - | - | |||||||||||
Debt securities | 11 | (9 | ) | - | - | |||||||||||
Equity securities (*2) (*3) (*4) | 6,679 | (6,779 | ) | - | - | |||||||||||
Beneficiary certificates (*4) | 1,321 | (1,211 | ) | - | - | |||||||||||
Others (*2) | 1,066 | (1,014 | ) | - | - | |||||||||||
Financial assets at FVTOCI | ||||||||||||||||
Equity securities (*3) (*4) | - | - | 33,395 | (25,335 | ) | |||||||||||
Total | 11,187 | (10,382 | ) | 33,395 | (25,335 | ) | ||||||||||
Financial liabilities: | ||||||||||||||||
Financial liabilities at FVTPL | ||||||||||||||||
Derivative liabilities (*1) | 292 | (384 | ) | - | - | |||||||||||
Total | 292 | (384 | ) | - | - | |||||||||||
(*1) | Fair value changes of equity related derivatives assets and liabilities are calculated by increasing or decreasing historical volatility of the stock price and correlation, which are major unobservable variables, by 10%, respectively. In the case of interest rate related derivative assets and liabilities, fair value changes are calculated by increasing or decreasing the volatility of interest rate, which are major unobservable variables, by 10%. |
(*2) | Fair value changes of equity securities are calculated by increasing or decreasing stock prices (-10%~10%) and volatility (-10~10%). The stock prices and volatility are major unobservable variables. |
(*3) | Fair value changes of equity securities are calculated by increasing or decreasing terminal growth rate (-0.5%~0.5%) and discount rate (-1~1%) or liquidation value (-1~1%). The growth rate, discount rate, and liquidation value are major unobservable variables. |
(*4) | Even if the sensitivity analysis of the capital contributions and beneficiary certificates is not possible in practice, fair value changes of beneficiary certificates and other securities whose major unobservable variables are composed of the real estate are calculated by increasing or decreasing price fluctuation rate of real estate which is underlying assets and discount rate by 1%. |
- 67 -
December 31, 2020 | ||||||||||||||||
Net income (loss) | Other comprehensive income (loss) | |||||||||||||||
Favorable | Unfavorable | Favorable | Unfavorable | |||||||||||||
Financial assets: | ||||||||||||||||
Financial assets at FVTPL | ||||||||||||||||
Derivative assets (*1) | 110 | (257 | ) | - | - | |||||||||||
Loans (*2) | 933 | (932 | ) | - | - | |||||||||||
Debt securities | 13 | (10 | ) | - | - | |||||||||||
Equity securities (*2) (*3) (*4) | 8,539 | (7,337 | ) | - | - | |||||||||||
Beneficiary certificates (*4) | 1,403 | (1,537 | ) | - | - | |||||||||||
Others (*2) | 640 | (547 | ) | - | - | |||||||||||
Financial assets at FVTOCI | ||||||||||||||||
Equity securities (*3) (*4) | - | - | 21,587 | (16,740 | ) | |||||||||||
Total | 11,638 | (10,620 | ) | 21,587 | (16,740 | ) | ||||||||||
Financial liabilities: | ||||||||||||||||
Financial liabilities at FVTPL | ||||||||||||||||
Derivative liabilities (*1) | 776 | (405 | ) | - | - | |||||||||||
Financial liabilities at FVTPL designated as upon initial recognition | ||||||||||||||||
Equity-linked securities (*1) | 57 | (45 | ) | - | - | |||||||||||
Total | 833 | (450 | ) | - | - | |||||||||||
(*1) | Fair value changes of equity related derivatives assets and liabilities and equity-linked securities are calculated by increasing or decreasing historical volatility of the stock price and correlation, which are major unobservable variables, by 10%, respectively. In the case of interest rate related derivative assets and liabilities, fair value changes are calculated by increasing or decreasing the volatility of interest rate, which are major unobservable variables, by 10%. |
(*2) | Fair value changes of equity securities are calculated by increasing or decreasing stock prices (-10%~10%) and volatility (-10~10%). The stock prices and volatility are major unobservable variables. |
(*3) | Fair value changes of equity securities are calculated by increasing or decreasing terminal growth rate (-0.5%~0.5%) and discount rate (-1~1%) or liquidation value (-1~1%). The growth rate, discount rate, and liquidation value are major unobservable variables. |
(*4) | Even if the sensitivity analysis of the capital contributions and beneficiary certificates is not possible in practice, fair value changes of beneficiary certificates and other securities whose major unobservable variables are composed of the real estate are calculated by increasing or decreasing price fluctuation rate of real estate which is underlying assets and discount rate by 1%. |
- 68 -
(5) | Fair value and carrying amount of financial assets and liabilities that are recorded at amortized cost are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||||||
Fair value |
Book value | |||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Financial assets: | ||||||||||||||||||||
Securities at amortized cost | 2,328,704 | 13,475,532 | - | 15,804,236 | 15,725,241 | |||||||||||||||
Loans and other financial assets at amortized cost | - | - | 342,946,182 | 342,946,182 | 345,150,425 | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
Deposits due to customers | - | 302,658,752 | - | 302,658,752 | 302,492,676 | |||||||||||||||
Borrowings | - | 22,086,961 | 433,613 | 22,520,574 | 22,545,862 | |||||||||||||||
Debentures | - | 40,871,588 | - | 40,871,588 | 40,917,952 | |||||||||||||||
Other financial liabilities | - | 20,670,368 | 290,368 | 20,960,736 | 21,208,340 |
December 31, 2020 | ||||||||||||||||||||
Fair value |
Book value | |||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Financial assets: | ||||||||||||||||||||
Securities at amortized cost | 2,968,875 | 14,299,748 | - | 17,268,623 | 17,020,839 | |||||||||||||||
Loans and other financial assets at amortized cost | - | - | 318,144,845 | 318,144,845 | 320,106,078 | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
Deposits due to customers | - | 291,767,282 | - | 291,767,282 | 291,477,279 | |||||||||||||||
Borrowings | - | 20,586,930 | 176,745 | 20,763,675 | 20,745,466 | |||||||||||||||
Debentures | - | 37,931,989 | - | 37,931,989 | 37,479,358 | |||||||||||||||
Other financial liabilities | - | 13,305,067 | 286,489 | 13,591,556 | 13,808,386 |
The fair values of financial instruments are measured using quoted market price in active markets. In case there is no active market for financial instruments, the Group determines the fair value by using valuation methods. Valuation methods and input variables for financial assets and liabilities that are measured at amortized cost are given as follows:
Valuation methods | Input variables | |||
Securities at amortized cost | The fair value is measured by discounting the projected cash flows of debt securities by applying risk-free market rate with credit spread. | Risk-free market rate and credit spread | ||
Loans and other financial assets at amortized cost | The fair value is measured by discounting the projected cash flows of loan products by applying the market discount rate that has been applied to a proxy company that has similar credit rating to the debtor. | Risk-free market rate, credit spread and prepayment rate | ||
Deposits due to customers, borrowings, debentures and other financial liabilities | The fair value is measured by discounting the projected cash flows of debt products by applying the market discount rate that is reflecting credit rating of the Group. | Risk-free market rate, credit spread and forward rate |
- 69 -
(6) | Financial instruments by category |
Carrying amounts of financial assets and liabilities by each category are as follows (Unit: Korean Won in millions):
June 30, 2021 | ||||||||||||||||||||
Financial assets at FVTPL |
Financial assets at FVTOCI |
Financial assets at amortized cost |
Derivatives assets (Designated for hedging) | Total | ||||||||||||||||
Financial assets | ||||||||||||||||||||
Deposits | 70,150 | - | 21,733,419 | - | 21,803,569 | |||||||||||||||
Securities | 7,738,566 | 30,284,891 | 15,725,241 | - | 53,748,698 | |||||||||||||||
Loans | 431,137 | - | 313,781,194 | - | 314,212,331 | |||||||||||||||
Derivative assets | 4,024,668 | - | - | 129,562 | 4,154,230 | |||||||||||||||
Other financial assets | - | - | 9,635,812 | - | 9,635,812 | |||||||||||||||
Total | 12,264,521 | 30,284,891 | 360,875,666 | 129,562 | 403,554,640 | |||||||||||||||
June 30, 2021 | ||||||||||||||||
Financial liabilities at FVTPL |
Financial liabilities at amortized cost |
Derivatives liabilities (Designated for hedging) | Total | |||||||||||||
Financial liabilities | ||||||||||||||||
Deposits due to customers | 70,394 | 302,492,676 | - | 302,563,070 | ||||||||||||
Borrowings | 200,083 | 22,545,862 | - | 22,745,945 | ||||||||||||
Debentures | - | 40,917,952 | - | 40,917,952 | ||||||||||||
Derivative liabilities | 3,657,704 | - | 44,045 | 3,701,749 | ||||||||||||
Other financial liabilities | - | 21,208,340 | - | 21,208,340 | ||||||||||||
Total | 3,928,181 | 387,164,830 | 44,045 | 391,137,056 | ||||||||||||
December 31, 2020 | ||||||||||||||||||||
Financial assets at FVTPL |
Financial assets at FVTOCI |
Financial assets at amortized cost |
Derivatives assets (Designated for hedging) | Total | ||||||||||||||||
Financial assets | ||||||||||||||||||||
Deposits | 48,796 | - | 9,863,160 | - | 9,911,956 | |||||||||||||||
Securities | 7,136,112 | 30,028,929 | 17,020,839 | - | 54,185,880 | |||||||||||||||
Loans | 676,291 | - | 302,794,182 | - | 303,470,473 | |||||||||||||||
Derivative assets | 6,901,742 | - | - | 174,820 | 7,076,562 | |||||||||||||||
Other financial assets | - | - | 7,448,736 | - | 7,448,736 | |||||||||||||||
Total | 14,762,941 | 30,028,929 | 337,126,917 | 174,820 | 382,093,607 | |||||||||||||||
December 31, 2020 | ||||||||||||||||||||
Financial liabilities at FVTPL |
Financial liabilities designated at FVTPL |
Financial liabilities at amortized cost |
Derivatives liabilities (Designated for hedging) | Total | ||||||||||||||||
Financial liabilities | ||||||||||||||||||||
Deposits due to customers | 49,279 | - | 291,477,279 | - | 291,526,558 | |||||||||||||||
Borrowings | 285,026 | 19,630 | 20,745,466 | - | 21,050,122 | |||||||||||||||
Debentures | - | - | 37,479,358 | - | 37,479,358 | |||||||||||||||
Derivative liabilities | 6,459,887 | - | - | 64,769 | 6,524,656 | |||||||||||||||
Other financial liabilities | - | - | 13,808,386 | - | 13,808,386 | |||||||||||||||
Total | 6,794,192 | 19,630 | 363,510,489 | 64,769 | 370,389,080 | |||||||||||||||
- 70 -
(7) | Income or expense from financial instruments by category |
Income or expense from financial assets and liabilities by each category during the six-month periods ended June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions):
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||
Interest income (expense) |
Fees and commissions income |
Reversal (provision) of credit loss |
Gain (loss) on valuation and transactions | Others | Total | |||||||||||||||||||
Financial assets at FVTPL | 22,420 | (42 | ) | - | 136,407 | 114,442 | 273,227 | |||||||||||||||||
Financial assets at FVTOCI | 175,607 | 840 | (2,097 | ) | 45,059 | 16,296 | 235,705 | |||||||||||||||||
Securities at amortized cost | 161,372 | - | 293 | - | - | 161,665 | ||||||||||||||||||
Loans and other financial assets at amortized cost | 4,351,072 | 244,135 | (220,715 | ) | 38,680 | - | 4,413,172 | |||||||||||||||||
Financial liabilities at amortized cost | (1,384,080 | ) | 1,114 | - | - | - | (1,382,966 | ) | ||||||||||||||||
Net derivatives (designated for hedging) | - | - | - | 34,380 | - | 34,380 | ||||||||||||||||||
Total | 3,326,391 | 246,047 | (222,519 | ) | 254,526 | 130,738 | 3,735,183 | |||||||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||
Interest income (expense) |
Fees and commissions income |
Reversal (provision) of credit loss |
Gain (loss) on valuation and transactions | Others | Total | |||||||||||||||||||
Financial assets at FVTPL | 26,210 | (613 | ) | - | 401,589 | 54,382 | 481,568 | |||||||||||||||||
Financial assets at FVTOCI | 241,000 | 102 | (782 | ) | 11,027 | 16,620 | 267,967 | |||||||||||||||||
Securities at amortized cost | 202,060 | - | (47 | ) | - | - | 202,013 | |||||||||||||||||
Loans and other financial assets at amortized cost | 4,446,733 | 197,667 | (422,066 | ) | 32,662 | - | 4,254,996 | |||||||||||||||||
Financial liabilities at amortized cost | (1,969,872 | ) | 1,133 | - | - | - | (1,968,739 | ) | ||||||||||||||||
Net derivatives (designated for hedging) | - | - | - | 14,942 | - | 14,942 | ||||||||||||||||||
Total | 2,946,131 | 198,289 | (422,895 | ) | 460,220 | 71,002 | 3,252,747 | |||||||||||||||||
- 71 -
12. | INVESTMENTS IN JOINT VENTURES AND ASSOCIATES |
(1) | Investments in associates accounted for using the equity method of accounting are as follows: |
Percentage of ownership (%) | ||||||||||||||||||
Joint ventures and associates | Main business |
June 30, 2021 |
December 31, 2020 | Location |
Financial statements as of | |||||||||||||
Woori Bank | ||||||||||||||||||
W Service Networks Co., Ltd. (*1) | Freight & staffing services | 4.9 | 4.9 | Korea | 2021.5.31(*4) | |||||||||||||
Korea Credit Bureau Co., Ltd. (*2) | Credit information | 9.9 | 9.9 | Korea | 2021.6.30 | |||||||||||||
Korea Finance Security Co., Ltd. (*1) | Security service | 15.0 | 15.0 | Korea | 2021.5.31(*4) | |||||||||||||
Wongwang Co., Ltd. (*3) | Wholesale and real estate | 29.0 | 29.0 | Korea | - | |||||||||||||
Sejin Construction Co., Ltd. (*3) | Construction | 29.6 | 29.6 | Korea | - | |||||||||||||
ARES-TECH Co., Ltd. (*3) | Electronic component manufacturing | 23.4 | 23.4 | Korea | - | |||||||||||||
Sinseong Trading Co., Ltd. (*3) | Manufacturing | 27.2 | 27.9 | Korea | - | |||||||||||||
Reading Doctors Co., Ltd. (*3) | Other services | 35.4 | 35.4 | Korea | - | |||||||||||||
Cultizm Korea LTD Co., Ltd. (*3) | Wholesale and retail sales | 31.3 | 31.3 | Korea | - | |||||||||||||
NK Eng Co., Ltd. (*3) | Manufacturing | 23.1 | 23.1 | Korea | - | |||||||||||||
Beomgyo., Ltd. (*3) | Telecommunication equipment retail sales | 23.1 | 23.1 | Korea | - | |||||||||||||
Woori Growth Partnerships New Technology Private Equity Fund | Other financial services | 23.1 | 23.1 | Korea | 2021.6.30 | |||||||||||||
2016KIF-IMM Woori Bank Technology Venture Fund | Other financial services | 20.0 | 20.0 | Korea | 2021.6.30 | |||||||||||||
K BANK Co., Ltd. (*2) | Finance | 26.2 | 26.2 | Korea | 2021.5.31(*4) | |||||||||||||
Smart Private Equity Fund No. 2 (*3) | Other financial services | - | 20.0 | Korea | - | |||||||||||||
Woori Bank-Company K Korea Movie Asset Fund | Other financial services | 25.0 | 25.0 | Korea | 2021.6.30 | |||||||||||||
Well to Sea No. 3 Private Equity Fund (*3) | Finance | - | 50.0 | Korea | - | |||||||||||||
Partner One Value Up I Private Equity Fund | Other financial services | 23.3 | 23.3 | Korea | 2021.6.30 | |||||||||||||
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership | Other financial services | 20.0 | 20.0 | Korea | 2021.6.30 | |||||||||||||
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund | Other financial services | 25.0 | 25.0 | Korea | 2021.6.30 | |||||||||||||
LOTTE CARD Co., Ltd. | Credit card and installment financing | 20.0 | 20.0 | Korea | 2021.3.31(*4) | |||||||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No. 3 | Other financial services | 100.0 | 100.0 | Korea | 2021.6.30 | |||||||||||||
Genesis Environmental Energy Company 1st Private Equity Fund | Trust and collective investment | 24.8 | 24.8 | Korea | 2021.3.31(*4) | |||||||||||||
Union Technology Finance Investment Association | Trust and collective investment | 29.7 | 29.7 | Korea | 2021.3.31(*4) | |||||||||||||
Woori Bank (*5) | ||||||||||||||||||
Japanese Hotel Real Estate Private Equity Fund 2 | Other financial services | 19.9 | 19.9 | Korea | 2021.6.30 | |||||||||||||
Woori G Clean Energy No. 1 | Investment trust and discretionary investment business | 29.3 | 29.3 | Korea | 2021.6.30 | |||||||||||||
Woori Goseong Power EBL Private Special Asset Fund | Trust and collective investment | 16.7 | 16.7 | Korea | 2021.6.30 |
- 72 -
Percentage of ownership (%) | ||||||||||||||||
Joint ventures and associates | Main business |
June 30, 2021 |
December 31, 2020 | Location |
Financial statements as of | |||||||||||
Woori Seoul Beltway Private Special Asset Fund | Trust and collective investment | 25.0 | 25.0 | Korea | 2021.6.30 | |||||||||||
Woori Corporate Private Securities Fund 1 (Bond) | Collective investment business | 20.0 | - | Korea | 2021.6.30 | |||||||||||
Woori G Star Private Placement Investment Trust No. 33 [FI] | Collective investment business | 15.8 | - | Korea | 2021.6.30 | |||||||||||
Woori Multi Return Private Securities Investment Trust 3 (Balanced Bond) | Collective investment business | 20.0 | - | Korea | 2021.6.30 | |||||||||||
Woori Short-term Bond Securities Investment Trust (Bond) Class C-F | Collective investment business | 3.4 | - | Korea | 2021.6.30 | |||||||||||
Woori Financial Capital Co., Ltd. | ||||||||||||||||
AJU TAERIM 1st Fund | Other financial services | 25.6 | 25.6 | Korea | 2021.6.30 | |||||||||||
Portone-Cape Fund No. 1 | Other financial services | 20.0 | 20.0 | Korea | 2021.6.30 | |||||||||||
KIWOOM PE AJU Investment Fund (*6) | Other financial services | 9.1 | 9.1 | Korea | 2021.6.30 | |||||||||||
Woori Investment Bank Co., Ltd. (*5) | ||||||||||||||||
Woori FirstValue Private Real Estate Fund No. 2 | Real estate business | 12.0 | 12.0 | Korea | 2021.6.30 | |||||||||||
Woori Asset Management Co. Ltd. | ||||||||||||||||
Woori High plus G.B. Securities Feeder Fund 1 (G.B.) | Collective investment business | 27.2 | 21.8 | Korea | 2021.6.30 | |||||||||||
Woori Star50 Master Fund Class C-F (*7) | Collective investment business | 45.1 | 24.5 | Korea | - | |||||||||||
Woori Private Equity Asset Management Co., Ltd. | ||||||||||||||||
Uri Hanhwa Eureka Private Equity Fund (*2) | Other financial services | 0.8 | 0.8 | Korea | 2021.6.30 | |||||||||||
Aarden Woori Apparel 1st Private Equity Fund (*2) | Other financial services | 0.5 | - | Korea | 2021.6.30 | |||||||||||
Japanese Hotel Real Estate Private Equity Fund 1 | ||||||||||||||||
Godo Kaisha Oceanos 1 | Other financial services | 47.8 | 47.8 | Japan | 2021.4.30(*4) | |||||||||||
Woori bank and Woori card Co., Ltd. (*5) | ||||||||||||||||
Dongwoo C & C Co., Ltd. (*3) | Construction | 24.5 | 24.5 | Korea | - | |||||||||||
SJCO Co., Ltd. (*3) | Aggregate transportation and wholesale | 28.7 | 28.7 | Korea | - | |||||||||||
G2 Collection Co., Ltd. (*3) | Wholesale and retail sales | 29.2 | 29.2 | Korea | - | |||||||||||
The Base Enterprise Co., Ltd. (*3) | Manufacturing | 48.4 | 48.4 | Korea | - | |||||||||||
Kyesan Engineering Co., Ltd. (*3) | Construction | 23.3 | 23.3 | Korea | - | |||||||||||
Good Software Lap Co., Ltd. (*3) | Service | 29.4 | 29.4 | Korea | - | |||||||||||
QTS Shipping Co., Ltd. (*3) | Complex transportation brokerage | 49.8 | 49.8 | Korea | - | |||||||||||
DAEA SNC Co., Ltd. (*3) | Wholesale and retail sales | 25.5 | 25.5 | Korea | - | |||||||||||
Force TEC Co., Ltd. | Manufacturing | 24.5 | 25.8 | Korea | 2021.3.31(*4) | |||||||||||
PREXCO Co., Ltd. (*3) | Manufacturing | 28.1 | 28.1 | Korea | - | |||||||||||
JiWon Plating Co., Ltd. (*3) | Plating | 20.8 | 20.8 | Korea | - |
- 73 -
Percentage of ownership (%) | ||||||||||||||||
Joint ventures and associates | Main business |
June 30, 2021 |
December 31, 2020 | Location |
Financial statements as of | |||||||||||
Youngdong Sea Food Co., Ltd. (*3) | Processed sea food manufacturing | 24.5 | 24.5 | Korea | - | |||||||||||
KUM HWA Co., Ltd. | Telecommunication equipment retail sales | 20.1 | - | Korea | 2020.12.31(*4) | |||||||||||
Woori bank and Woori Financial Capital Co., Ltd. (*5) | ||||||||||||||||
JC Assurance No. 2 Private Equity Fund | Collective investment business | 29.3 | 29.3 | Korea | 2021.6.30 | |||||||||||
Dream Company Growth no. 1 PEF | Collective investment business | 27.8 | 27.8 | Korea | 2021.6.30 | |||||||||||
HMS-Oriens 1st Fund | Trust and collective investment | 22.8 | 22.8 | Korea | 2021.6.30 | |||||||||||
Woori G Senior Loan No. 1 | Investment trust and discretionary investment business | 21.7 | 21.7 | Korea | 2021.6.30 | |||||||||||
Genesis Eco No. 1 Private Equity Fund | Other financial services | 29 | - | Korea | 2021.6.30 | |||||||||||
PARATUSWOORI MATERIALS PARTS EQUIPMENT PRIVATE EQUITY FUND | Other financial services | 29.9 | - | Korea | 2021.6.30 | |||||||||||
Woori Bank and Woori Investment Bank Co., Ltd. (*5) | ||||||||||||||||
PCC-Woori LP Secondary Fund | Other financial services | 38.8 | 38.8 | Korea | 2021.6.30 | |||||||||||
Woori bank and Woori Asset Management Co., Ltd. (*5) | ||||||||||||||||
Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 | Collective investment business | 26.5 | 23.3 | Korea | 2021.6.30 | |||||||||||
Woori Bank and Woori Private Equity Asset Management Co., Ltd. (*5) | ||||||||||||||||
Woori-Q Corporate Restructuring Private Equity Fund | Trust and collective investment | 37.8 | 38.4 | Korea | 2021.6.30 | |||||||||||
Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd. and Woori Private Equity Asset Management Co., Ltd. (*5) | ||||||||||||||||
Woori-Shinyoung Growth-Cap Private Equity Fund I | Other financial services | 35.0 | 35.0 | Korea | 2021.6.30 |
(*1) | Most of the significant business transactions of associates are with the Group as of June 30, 2021 and December 31, 2020. |
(*2) | The Group can participate in decision-making body and exercise significant influence over financial policies and operational policies decision making of the associates. |
(*3) | There is no investment balance as of June 30, 2021 and December 31, 2020. |
(*4) | The equity method was applied using the most recent financial statements available from the settlement date because no financial statements were available at the end of December and the significant transactions or events that occurred between the end of the reporting period of the associate and the end of the reporting period of the subsidiary were duly reflected. |
(*5) | Two or more subsidiaries may invest or operate to exert significant influence on the decision-making process for activities related to the investee. |
(*6) | The Group can participate as a co-operator to exert significant influence. |
(*7) | It has been reclassified as a subsidiary from an associate due to an increase in ownership interest. |
(*8) | Woori G IPO10 [FI_Bal][F]C(F) can exercise significant influence but was classified as an item measured at fair value through profit or loss. |
- 74 -
(2) | Changes in the carrying value of investments in associates accounted for using the equity method of accounting are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||||||||||
Acquisition cost |
January 1, 2021 |
Share of profits (losses) |
Acquisi- tion |
Disposal/ Reclassification | Dividends |
Change in capital |
June 30, 2021 | |||||||||||||||||||||||||
W Service Networks Co., Ltd. | 108 | 191 | (21 | ) | - | - | (4 | ) | - | 166 | ||||||||||||||||||||||
Korea Credit Bureau Co., Ltd. | 3,313 | 8,125 | 458 | - | - | (90 | ) | - | 8,493 | |||||||||||||||||||||||
Korea Finance Security Co., Ltd. | 3,267 | 3,066 | (56 | ) | - | - | - | - | 3,010 | |||||||||||||||||||||||
Woori Growth Partnerships New Technology Private Equity Fund | 16,371 | 15,032 | (614 | ) | - | (567 | ) | - | (7 | ) | 13,844 | |||||||||||||||||||||
2016KIF-IMM Woori Bank Technology Venture Fund | 11,060 | 13,238 | (182 | ) | - | (833 | ) | - | - | 12,223 | ||||||||||||||||||||||
K BANK Co., Ltd. | 236,232 | 174,097 | (8,332 | ) | - | - | - | (1,772 | ) | 163,993 | ||||||||||||||||||||||
Smart Private Equity Fund No. 2 | - | 1,481 | (796 | ) | - | (685 | ) | - | - | - | ||||||||||||||||||||||
Woori Bank-Company K Korea Movie Asset Fund | 600 | 2,788 | 86 | - | (1,500 | ) | - | - | 1,374 | |||||||||||||||||||||||
Partner One Value Up I Private Equity Fund | 10,000 | 9,816 | (76 | ) | - | - | - | (16 | ) | 9,724 | ||||||||||||||||||||||
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership | 14,236 | 9,756 | - | 5,040 | (560 | ) | - | - | 14,236 | |||||||||||||||||||||||
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund | 4,192 | 4,129 | - | 63 | - | - | - | 4,192 | ||||||||||||||||||||||||
LOTTE CARD Co., Ltd | 346,810 | 422,832 | 12,826 | - | - | (10,374 | ) | 3,248 | 428,532 | |||||||||||||||||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No. 3 | 10,000 | 10,023 | 18 | - | - | - | - | 10,041 | ||||||||||||||||||||||||
Genesis Environmental Energy Company 1st Private Equity Fund | 3,738 | 3,979 | 28 | - | - | - | - | 4,007 | ||||||||||||||||||||||||
Union Technology Finance Investment Association | 10,500 | 4,485 | (175 | ) | 6,000 | - | - | - | 10,310 | |||||||||||||||||||||||
Japanese Hotel Real Estate Private Equity Fund 2 | 3,291 | 3,234 | 76 | - | - | (104 | ) | (98 | ) | 3,108 | ||||||||||||||||||||||
Woori G Clean Energy No. 1 | 2,477 | 1,024 | 138 | 1,462 | - | - | - | 2,624 | ||||||||||||||||||||||||
Woori Goseong Power EBL Private Special Asset Fund | 14,915 | 15,118 | 245 | - | - | (246 | ) | - | 15,117 | |||||||||||||||||||||||
Woori Seoul Beltway Private Special Asset Fund | 6,273 | 5,613 | 54 | 831 | - | (48 | ) | - | 6,450 | |||||||||||||||||||||||
Woori Corporate Private Securities Fund 1 (Bond) | 10,000 | - | (27 | ) | 10,000 | - | - | - | 9,973 | |||||||||||||||||||||||
Woori G Star Private Placement Investment Trust No. 33 [FI] | 20,000 | - | 63 | 20,000 | - | - | - | 20,063 | ||||||||||||||||||||||||
Woori Multi Return Private Securities Investment Trust 3 (Balanced Bond) | 10,000 | - | (28 | ) | 10,000 | - | - | - | 9,972 | |||||||||||||||||||||||
Woori Short-term Bond Securities Investment Trust (Bond) Class C-F | 50,000 | - | 444 | 50,000 | - | - | - | 50,444 | ||||||||||||||||||||||||
AJU TAERIM 1st Fund | 1,100 | 283 | (11 | ) | - | - | - | - | 272 | |||||||||||||||||||||||
Portone-Cape Fund No. 1 | 340 | 960 | 189 | - | (660 | ) | - | - | 489 | |||||||||||||||||||||||
KIWOOM PE AJU Investment Fund | 1,000 | 994 | (10 | ) | - | - | - | - | 984 | |||||||||||||||||||||||
Woori FirstValue Private Real Estate Fund No. 2 | 9,000 | 2,130 | (637 | ) | - | - | - | - | 1,493 |
- 75 -
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||||||||||
Acquisition cost |
January 1, 2021 |
Share of profits (losses) |
Acquisi- tion |
Disposal/ Reclassification | Dividends |
Change in capital |
June 30, 2021 | |||||||||||||||||||||||||
Woori High plus G.B. Securities Feeder Fund 1 (G.B.) | 6,000 | 6,076 | (29 | ) | - | - | - | - | 6,047 | |||||||||||||||||||||||
Woori Star50 Master Fund Class C-F | - | 184 | 35 | - | (219 | ) | - | - | - | |||||||||||||||||||||||
Uri Hanhwa Eureka Private Equity Fund | 350 | 403 | (2 | ) | - | - | - | - | 401 | |||||||||||||||||||||||
Aarden Woori Apparel 1st Private Equity Fund | 100 | - | - | 100 | - | - | - | 100 | ||||||||||||||||||||||||
Godo Kaisha Oceanos 1 | 10,800 | 10,193 | (2 | ) | - | - | (370 | ) | (32 | ) | 9,789 | |||||||||||||||||||||
Force TEC Co., Ltd. | - | 393 | (393 | ) | - | - | - | - | - | |||||||||||||||||||||||
KUM HWA Co., Ltd. | - | - | 1 | - | - | - | - | 1 | ||||||||||||||||||||||||
JC Assurance No. 2 Private Equity Fund | 29,349 | 29,050 | (370 | ) | 299 | - | - | - | 28,979 | |||||||||||||||||||||||
Dream Company Growth no. 1 PEF | 8,000 | 7,705 | 234 | - | - | - | - | 7,939 | ||||||||||||||||||||||||
HMS-Oriens 1st Fund | 12,000 | 12,000 | 250 | - | - | - | - | 12,250 | ||||||||||||||||||||||||
Woori G Senior Loan No. 1 | 64,950 | 52,045 | 1,289 | 12,991 | - | (562 | ) | - | 65,763 | |||||||||||||||||||||||
Genesis Eco No. 1 Private Equity Fund | 10,704 | - | (683 | ) | 10,704 | - | - | - | 10,021 | |||||||||||||||||||||||
PARATUSWOORI MATERIALS PARTS EQUIPMENT PRIVATE EQUITY FUND | 16,400 | - | (2 | ) | 16,400 | - | - | - | 16,398 | |||||||||||||||||||||||
PCC-Woori LP Secondary Fund | 10,100 | 8,128 | 160 | 2,525 | - | - | - | 10,813 | ||||||||||||||||||||||||
Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 | 110,221 | 93,474 | 490 | 20,000 | - | (2,503 | ) | - | 111,461 | |||||||||||||||||||||||
Woori-Q Corporate Restructuring Private Equity Fund | 20,148 | 22,904 | 1,068 | - | (2,996 | ) | - | - | 20,976 | |||||||||||||||||||||||
Woori-Shinyoung Growth-Cap Private Equity Fund I | 41,622 | 38,342 | 20,537 | 10,420 | - | - | (96 | ) | 69,202 | |||||||||||||||||||||||
1,139,567 | 993,291 | 26,241 | 176,835 | (8,020 | ) | (14,301 | ) | 1,227 | 1,175,274 | |||||||||||||||||||||||
- 76 -
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||||||||||
Acquisition cost |
January 1, 2020 |
Share of profits (losses) |
Acquisi- tion |
Disposal/ Reclassification | Dividends |
Change in capital |
June 30, 2020 | |||||||||||||||||||||||||
W Service Networks Co., Ltd. | 108 | 186 | (19 | ) | - | - | (3 | ) | - | 164 | ||||||||||||||||||||||
Korea Credit Bureau Co., Ltd. | 3,313 | 6,845 | 743 | - | - | (90 | ) | - | 7,498 | |||||||||||||||||||||||
Korea Finance Security Co., Ltd. | 3,267 | 3,287 | (83 | ) | - | - | - | - | 3,204 | |||||||||||||||||||||||
Saman Corporation | 8,521 | 849 | (418 | ) | - | - | - | 37 | 468 | |||||||||||||||||||||||
Woori Growth Partnerships New Technology Private Equity Fund | 18,666 | 19,212 | (2,064 | ) | - | - | - | - | 17,148 | |||||||||||||||||||||||
2016KIF-IMM Woori Bank Technology Venture Fund | 12,385 | 15,141 | 1,176 | - | - | - | (1,563 | ) | 14,754 | |||||||||||||||||||||||
K BANK Co., Ltd. | 73,150 | 31,254 | (6,917 | ) | - | - | - | 21 | 24,358 | |||||||||||||||||||||||
Smart Private Equity Fund No. 2 | 2,915 | 2,764 | (21 | ) | - | - | - | - | 2,743 | |||||||||||||||||||||||
Woori Bank-Company K Korea Movie Asset Fund | 2,100 | 3,323 | 315 | - | (900 | ) | - | - | 2,738 | |||||||||||||||||||||||
Well to Sea No. 3 Private Equity Fund | 101,483 | 209,023 | 16,385 | - | - | (24,393 | ) | (1,085 | ) | 199,930 | ||||||||||||||||||||||
Partner One Value Up I Private Equity Fund | 10,000 | 9,908 | (41 | ) | - | - | - | - | 9,867 | |||||||||||||||||||||||
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership | 6,596 | 4,576 | - | 2,020 | - | - | - | 6,596 | ||||||||||||||||||||||||
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund | 4,055 | 4,375 | - | - | (321 | ) | - | - | 4,054 | |||||||||||||||||||||||
LOTTE CARD Co., Ltd | 346,810 | 409,444 | 13,822 | 810 | - | (5,710 | ) | (3,343 | ) | 415,023 | ||||||||||||||||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No. 3 | 100,000 | - | 80 | 100,000 | - | - | - | 100,080 | ||||||||||||||||||||||||
Japanese Hotel Real Estate Private Equity Fund 2 | 3,291 | 3,291 | 188 | - | - | (56 | ) | - | 3,423 | |||||||||||||||||||||||
Woori All-in-One World EMP 40 [Bond Mixed-FOF] | 5,000 | - | (107 | ) | 5,000 | - | - | - | 4,893 | |||||||||||||||||||||||
Uri Hanhwa Eureka Private Equity Fund | 350 | 342 | (2 | ) | - | - | - | - | 340 | |||||||||||||||||||||||
Godo Kaisha Oceanos 1 | 10,800 | 10,952 | 209 | - | - | (689 | ) | 20 | 10,492 | |||||||||||||||||||||||
Force TEC Co., Ltd. | - | - | 1,563 | - | - | - | (442 | ) | 1,121 | |||||||||||||||||||||||
Woori-Shinyoung Growth-Cap Private Equity Fund I | 32,572 | 11,841 | (61 | ) | 19,906 | - | - | - | 31,686 | |||||||||||||||||||||||
Chin Hung International Inc. | 130,779 | 51,176 | (726 | ) | - | - | - | (22 | ) | 50,428 | ||||||||||||||||||||||
PCC-Woori LP Secondary Fund | 5,050 | 2,525 | (124 | ) | 2,525 | - | - | - | 4,926 | |||||||||||||||||||||||
Woori High plus G.B. Securities Feeder Fund 1 (G.B.) | 6,141 | - | 120 | 6,141 | - | - | - | 6,261 | ||||||||||||||||||||||||
Woori-Q Corporate Restructuring Private Equity Fund | 6,129 | 6,046 | (80 | ) | - | - | - | - | 5,966 | |||||||||||||||||||||||
893,481 | 806,360 | 23,938 | 136,402 | (1,221 | ) | (30,941 | ) | (6,377 | ) | 928,161 | ||||||||||||||||||||||
- 77 -
(3) | Summary financial information relating to investments in associates accounted for using the equity method of accounting is as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||||||||||
Assets | Liabilities |
Operating revenue |
Net income (loss) |
Other comprehensive income(loss) |
Total comprehensive income(loss) | |||||||||||||||||||
W Service Networks Co., Ltd. | 5,860 | 2,497 | 7,874 | 499 | - | 499 | ||||||||||||||||||
Korea Credit Bureau Co., Ltd. | 122,167 | 38,981 | 60,698 | 11,097 | - | 11,097 | ||||||||||||||||||
Korea Finance Security Co., Ltd. | 33,906 | 13,840 | 27,036 | (356 | ) | - | (356 | ) | ||||||||||||||||
Woori Growth Partnerships New Technology Private Equity Fund | 60,229 | 240 | 1,354 | (2,190 | ) | - | (2,190 | ) | ||||||||||||||||
2016KIF-IMM Woori Bank Technology Venture Fund | 58,421 | 583 | 15 | (665 | ) | - | (665 | ) | ||||||||||||||||
K BANK Co., Ltd. | 13,851,753 | 13,380,340 | 84,541 | (10,414 | ) | (6,943 | ) | (17,357 | ) | |||||||||||||||
Woori Bank-Company K Korea Movie Asset Fund | 5,532 | 35 | 375 | 339 | - | 339 | ||||||||||||||||||
Partner One Value Up I Private Equity Fund | 41,807 | - | 3 | (323 | ) | - | (323 | ) | ||||||||||||||||
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership | 70,554 | 649 | 2,312 | 1,617 | - | 1,617 | ||||||||||||||||||
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund | 15,762 | - | - | (114 | ) | - | (114 | ) | ||||||||||||||||
LOTTE CARD Co., Ltd (*) | 14,705,638 | 12,336,183 | 492,964 | 49,836 | 9,171 | 59,007 | ||||||||||||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No. 3 | 10,044 | 1 | 10 | 8 | - | 8 | ||||||||||||||||||
Genesis Environmental Energy Company 1st Private Equity Fund | 20,601 | 4,411 | 3,375 | 199 | - | 199 | ||||||||||||||||||
Union Technology Finance Investment Association | 35,002 | 290 | 6 | (587 | ) | - | (587 | ) | ||||||||||||||||
Japanese Hotel Real Estate Private Equity Fund 2 | 15,659 | 14 | 431 | 382 | (1,434 | ) | (1,052 | ) | ||||||||||||||||
Woori G Clean Energy No. 1 | 8,972 | 19 | 488 | 470 | - | 470 | ||||||||||||||||||
Woori Goseong Power EBL Private Special Asset Fund | 90,721 | 21 | 1,517 | 1,472 | - | 1,472 | ||||||||||||||||||
Woori Seoul Beltway Private Special Asset Fund | 25,802 | 1 | 234 | 217 | - | 217 | ||||||||||||||||||
Woori Corporate Private Securities Fund 1 (Bond) | 49,891 | 42 | 13 | 13 | - | 13 | ||||||||||||||||||
Woori G Star Private Placement Investment Trust No. 33 [FI] | 126,585 | 28 | 472 | 399 | - | 399 | ||||||||||||||||||
Woori Multi Return Private Securities Investment Trust 3(Balanced Bond) | 135,992 | 86,130 | 29 | 27 | - | 27 | ||||||||||||||||||
Woori Short-term Bond Securities Investment Trust (Bond) Class C-F | 1,608,203 | 125,716 | 110 | 107 | - | 107 | ||||||||||||||||||
AJU TAERIM 1st Fund | 1,192 | 129 | - | (43 | ) | - | (43 | ) | ||||||||||||||||
Portone-Cape Fund No. 1 | 2,447 | - | 1,050 | 947 | - | 947 | ||||||||||||||||||
KIWOOM PE AJU Investment Fund | 10,929 | 109 | - | (109 | ) | - | (109 | ) | ||||||||||||||||
Woori FirstValue Private Real Estate Fund No. 2 | 14,918 | 2,471 | - | - | - | - | ||||||||||||||||||
Woori High plus G.B. Securities Feeder Fund 1 (G.B.) | 22,278 | - | 7 | 7 | - | 7 | ||||||||||||||||||
Uri Hanhwa Eureka Private Equity Fund | 50,159 | 232 | 20 | (220 | ) | - | (220 | ) | ||||||||||||||||
Aarden Woori Apparel 1st Private Equity Fund | 21,200 | 27 | - | (27 | ) | - | (27 | ) | ||||||||||||||||
Godo Kaisha Oceanos 1 | 66,038 | 45,562 | 1,497 | (3 | ) | - | (3 | ) | ||||||||||||||||
Force TEC Co., Ltd. | 29,045 | 37,358 | 7,239 | 1,056 | - | 1,056 | ||||||||||||||||||
KUM HWA Co., Ltd. | 34 | 175 | 25 | 5 | - | 5 | ||||||||||||||||||
JC Assurance No. 2 Private Equity Fund | 98,921 | 15 | - | (533 | ) | - | (533 | ) | ||||||||||||||||
Dream Company Growth no. 1 PEF | 30,327 | 1,744 | - | 1,594 | - | 1,594 | ||||||||||||||||||
HMS-Oriens 1st Fund | 53,702 | 6 | 1,364 | 1,065 | - | 1,065 | ||||||||||||||||||
Woori G Senior Loan No. 1 | 303,775 | 16 | 6,342 | 5,953 | - | 5,953 | ||||||||||||||||||
Genesis Eco No. 1 Private Equity Fund | 34,574 | - | - | 367 | - | 367 | ||||||||||||||||||
PARATUSWOORI MATERIALS PARTS EQUIPMENT PRIVATE EQUITY FUND | 54,900 | 7 | - | (7 | ) | - | (7 | ) | ||||||||||||||||
PCC-Woori LP Secondary Fund | 27,842 | 4 | 750 | 415 | - | 415 | ||||||||||||||||||
Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 | 426,689 | - | 1,850 | 1,850 | - | 1,850 | ||||||||||||||||||
Woori-Q Corporate Restructuring Private Equity Fund | 55,986 | 439 | 280 | (693 | ) | - | (693 | ) | ||||||||||||||||
Woori-Shinyoung Growth-Cap Private Equity Fund I | 198,494 | 602 | 81,046 | 80,193 | - | 80,193 |
(*) | The amount is after reflecting the fair value adjustment that occurred when acquiring the shares and the adjustments that occurred by difference of accounting policies with the Group. |
- 78 -
December 31, 2020 | ||||||||||||||||||||||||
Assets | Liabilities |
Operating revenue |
Net income (loss) |
Other comprehensive income(loss) |
Total comprehensive income(loss) | |||||||||||||||||||
W Service Networks Co., Ltd. | 6,305 | 2,448 | 18,525 | 1,197 | - | 1,197 | ||||||||||||||||||
Korea Credit Bureau Co., Ltd. | 117,077 | 37,599 | 107,810 | 13,391 | - | 13,391 | ||||||||||||||||||
Korea Finance Security Co., Ltd. | 36,978 | 16,536 | 60,599 | (1,985 | ) | - | (1,985 | ) | ||||||||||||||||
Woori Growth Partnerships New Technology Private Equity Fund | 65,390 | 252 | 1,589 | (9,601 | ) | - | (9,601 | ) | ||||||||||||||||
2016KIF-IMM Woori Bank Technology Venture Fund | 64,109 | 1,198 | 7,425 | 6,201 | - | 6,201 | ||||||||||||||||||
K BANK Co., Ltd. | 4,040,051 | 3,530,074 | 68,144 | (83,989 | ) | (1,354 | ) | (85,343 | ) | |||||||||||||||
Smart Private Equity Fund No. 2 | 13,667 | 51 | 1 | (204 | ) | - | (204 | ) | ||||||||||||||||
Woori Bank-Company K Korea Movie Asset Fund | 11,273 | 119 | 1,926 | 1,461 | - | 1,461 | ||||||||||||||||||
Well to Sea No. 3 Private Equity Fund | 22,001 | 3,102 | 610,535 | 16,061 | 3,976 | 20,037 | ||||||||||||||||||
Partner One Value Up I Private Equity Fund | 42,205 | - | 308 | (329 | ) | - | (329 | ) | ||||||||||||||||
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership | 46,542 | 655 | 1,024 | (411 | ) | - | (411 | ) | ||||||||||||||||
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund | 15,747 | - | 284 | (85 | ) | - | (85 | ) | ||||||||||||||||
LOTTE CARD Co., Ltd (*) | 14,578,716 | 12,238,805 | 1,255,593 | 78,781 | (9,040 | ) | 69,741 | |||||||||||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No. 3 | 10,025 | 1 | 187 | 23 | - | 23 | ||||||||||||||||||
Genesis Environmental Energy Company 1st Private Equity Fund | 16,192 | 118 | 1,400 | 974 | - | 974 | ||||||||||||||||||
Union Technology Finance Investment Association | 15,151 | 51 | 1 | (50 | ) | - | (50 | ) | ||||||||||||||||
Japanese Hotel Real Estate Private Equity Fund 2 | 16,293 | 15 | 1,359 | 1,271 | (940 | ) | 331 | |||||||||||||||||
Woori G Clean Energy No. 1 | 3,496 | 1 | 33 | 32 | - | 32 | ||||||||||||||||||
Woori Goseong Power EBL Private Special Asset Fund | 90,728 | 21 | 3,060 | 2,969 | - | 2,969 | ||||||||||||||||||
Woori Seoul Beltway Private Special Asset Fund | 22,452 | 1 | 352 | 323 | - | 323 | ||||||||||||||||||
AJU TAERIM 1st Fund | 1,192 | 86 | - | (22 | ) | - | (22 | ) | ||||||||||||||||
Portone-Cape Fund No. 1 | 4,800 | - | - | - | - | - | ||||||||||||||||||
KIWOOM PE AJU Investment Fund | 10,986 | 57 | - | (71 | ) | - | (71 | ) | ||||||||||||||||
Woori FirstValue Private Real Estate Fund No. 2 | 20,220 | 2,467 | 9 | (9 | ) | - | (9 | ) | ||||||||||||||||
Woori High plus G.B. Securities Feeder Fund 1 (G.B.) | 27,870 | - | 148 | 148 | - | 148 | ||||||||||||||||||
Woori Star50 Master Fund Class C-F | 1,011 | 246 | 11 | 11 | - | 11 | ||||||||||||||||||
Uri Hanhwa Eureka Private Equity Fund | 50,382 | 235 | 8,150 | 7,676 | - | 7,676 | ||||||||||||||||||
Godo Kaisha Oceanos 1 | 66,793 | 45,472 | 1,425 | 14 | - | 14 | ||||||||||||||||||
Force TEC Co., Ltd. | 47,077 | 45,552 | 25,914 | (415 | ) | (2,745 | ) | (3,160 | ) | |||||||||||||||
JC Assurance No. 2 Private Equity Fund | 98,431 | 13 | - | (732 | ) | - | (732 | ) | ||||||||||||||||
Dream Company Growth no. 1 PEF | 28,727 | 43 | - | (116 | ) | - | (116 | ) | ||||||||||||||||
HMS-Oriens 1st Fund | 52,685 | 53 | 90 | 20 | - | 20 | ||||||||||||||||||
Woori G Senior Loan No. 1 | 240,414 | 15 | 1,721 | 1,584 | - | 1,584 | ||||||||||||||||||
PCC-Woori LP Secondary Fund | 20,927 | 4 | 2,082 | 1,425 | - | 1,425 | ||||||||||||||||||
Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 | 402,015 | - | 10,727 | 10,727 | - | 10,727 | ||||||||||||||||||
Woori-Q Corporate Restructuring Private Equity Fund | 58,355 | 433 | 206 | (1,590 | ) | - | (1,590 | ) | ||||||||||||||||
Woori-Shinyoung Growth-Cap Private Equity Fund I | 110,452 | 825 | 23,875 | 21,106 | - | 21,106 |
(*) | The amount is after reflecting the fair value adjustment that occurred when acquiring the shares and the adjustments that occurred by difference of accounting policies with the Group. |
- 79 -
(4) | The entities that the Group has not applied equity method of accounting although the Group's ownership interest is more than 20% as of June 30, 2021 and December 31, 2020 are as follows: |
June 30, 2021 | ||||||||
Associate (*) |
Number of shares owned | Ownership (%) | ||||||
Orient Shipyard Co., Ltd. | 464,812 | 21.4 | ||||||
Yuil PESC Co., Ltd. | 8,642 | 24.0 | ||||||
CL Tech Co., Ltd. | 13,759 | 38.6 |
(*) | Even though the Group's ownership interest of the entity is more than 20%, the Group does not have significant influence over the entity since it is going through work-out process under receivership, thus it is excluded from the investment in joint ventures and associates. |
December 31, 2020 | ||||||||
Associate (*) |
Number of shares owned | Ownership (%) | ||||||
Orient Shipyard Co., Ltd. | 464,812 | 21.4 | ||||||
Yuil PESC Co., Ltd. | 8,642 | 24.0 | ||||||
CL Tech Co., Ltd. | 13,759 | 38.6 |
(*) | Even though the Group's ownership interest of the entity is more than 20%, the Group does not have significant influence over the entity since it is going through work-out process under receivership, thus it is excluded from the investment in joint ventures and associates. |
(5) | As of June 30, 2021 and December 31, 2020, the reconciliations from the net assets of the associates to the book value of the shares of the investment in joint ventures and associates are as follows (Unit: Korean Won in millions except for ownership): |
June 30, 2021 | |||||||||||||||||||||||||||
Total net asset |
Ownership (%) |
Ownership portion of net assets |
Basis difference | Impairment |
Intercompany transaction |
Book value | |||||||||||||||||||||
W Service Networks Co., Ltd. | 3,363 | 4.9 | 166 | - | - | - | 166 | ||||||||||||||||||||
Korea Credit Bureau Co., Ltd. | 83,186 | 9.9 | 8,244 | 246 | - | 3 | 8,493 | ||||||||||||||||||||
Korea Finance Security Co., Ltd. | 20,066 | 15.0 | 3,010 | - | - | - | 3,010 | ||||||||||||||||||||
Woori Growth Partnerships New Technology Private Equity Fund | 59,989 | 23.1 | 13,846 | - | - | (2 | ) | 13,844 | |||||||||||||||||||
2016KIF-IMM Woori Bank Technology Venture Fund | 57,838 | 20.0 | 11,568 | - | - | 655 | 12,223 | ||||||||||||||||||||
K BANK Co., Ltd. (*1) (*2) | 471,412 | 26.2 | 123,510 | 44,117 | (3,634 | ) | - | 163,993 | |||||||||||||||||||
Woori Bank-Company K Korea Movie Asset Fund | 5,497 | 25.0 | 1,374 | - | - | - | 1,374 | ||||||||||||||||||||
Partner One Value Up Ist Private Equity Fund | 41,807 | 23.3 | 9,724 | - | - | - | 9,724 | ||||||||||||||||||||
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership | 69,905 | 20.0 | 13,981 | - | - | 255 | 14,236 | ||||||||||||||||||||
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund | 15,762 | 25.0 | 3,940 | - | - | 252 | 4,192 | ||||||||||||||||||||
LOTTE CARD Co., Ltd (*1) | 2,142,659 | 20.0 | 428,532 | - | - | - | 428,532 | ||||||||||||||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No. 3 | 10,043 | 100.0 | 10,043 | - | - | (2 | ) | 10,041 | |||||||||||||||||||
Genesis Environmental Energy Company 1st Private Equity Fund | 16,190 | 24.8 | 4,007 | - | - | - | 4,007 | ||||||||||||||||||||
Union Technology Finance Investment Association | 34,712 | 29.7 | 10,309 | - | - | 1 | 10,310 | ||||||||||||||||||||
Japanese Hotel Real Estate Private Equity Fund 2 | 15,645 | 19.9 | 3,108 | - | - | - | 3,108 | ||||||||||||||||||||
Woori G Clean Energy No. 1 | 8,953 | 29.3 | 2,624 | - | - | - | 2,624 |
- 80 -
June 30, 2021 | |||||||||||||||||||||||||||
Total net asset |
Ownership (%) |
Ownership portion of net assets |
Basis difference | Impairment |
Intercompany transaction |
Book value | |||||||||||||||||||||
Woori Goseong Power EBL Private Special Asset Fund | 90,700 | 16.7 | 15,117 | - | - | - | 15,117 | ||||||||||||||||||||
Woori Seoul Beltway Private Special Asset Fund | 25,801 | 25.0 | 6,450 | - | - | - | 6,450 | ||||||||||||||||||||
Woori Corporate Private Securities Fund 1 (Bond) | 49,849 | 20.0 | 9,973 | - | - | - | 9,973 | ||||||||||||||||||||
Woori G Star Private Placement Investment Trust No. 33 [FI] | 126,557 | 15.8 | 20,063 | - | - | - | 20,063 | ||||||||||||||||||||
Woori Multi Return Private Securities Investment Trust 3(Balanced Bond) | 49,862 | 20.0 | 9,972 | - | - | - | 9,972 | ||||||||||||||||||||
Woori Short-term Bond Securities Investment Trust (Bond) Class C-F | 1,482,487 | 3.4 | 50,444 | - | - | - | 50,444 | ||||||||||||||||||||
AJU TAERIM 1st Fund | 1,063 | 25.6 | 272 | - | - | - | 272 | ||||||||||||||||||||
Portone-Cape Fund No. 1 | 2,447 | 20.0 | 489 | - | - | - | 489 | ||||||||||||||||||||
KIWOOM PE AJU Investment Fund | 10,820 | 9.1 | 984 | - | - | - | 984 | ||||||||||||||||||||
Woori FirstValue Private Real Estate Fund No. 2 | 12,447 | 12.0 | 1,493 | - | - | - | 1,493 | ||||||||||||||||||||
Woori High plus G.B. Securities Feeder Fund 1 (G.B.) | 22,278 | 27.2 | 6,047 | - | - | - | 6,047 | ||||||||||||||||||||
Uri Hanhwa Eureka Private Equity Fund | 49,927 | 0.8 | 401 | - | - | - | 401 | ||||||||||||||||||||
Aarden Woori Apparel 1st Private Equity Fund | 21,173 | 0.5 | 100 | - | - | - | 100 | ||||||||||||||||||||
Godo Kaisha Oceanos 1 | 20,476 | 47.8 | 9,789 | - | - | - | 9,789 | ||||||||||||||||||||
Force TEC | (8,313 | ) | 24.5 | (2,040 | ) | - | - | 2,040 | - | ||||||||||||||||||
KUM HWA Co., Ltd. | (141 | ) | 20.1 | (28 | ) | - | - | 29 | 1 | ||||||||||||||||||
JC Assurance No. 2 Private Equity Fund | 98,906 | 29.3 | 28,979 | - | - | - | 28,979 | ||||||||||||||||||||
Dream Company Growth no. 1 PEF | 28,583 | 27.8 | 7,939 | - | - | - | 7,939 | ||||||||||||||||||||
HMS-Oriens 1st Fund | 53,696 | 22.8 | 12,250 | - | - | - | 12,250 | ||||||||||||||||||||
Woori G Senior Loan No. 1 | 303,759 | 21.7 | 65,763 | - | - | - | 65,763 | ||||||||||||||||||||
Genesis Eco No. 1 Private Equity Fund | 34,574 | 29.0 | 10,021 | - | - | - | 10,021 | ||||||||||||||||||||
PARATUSWOORI MATERIALS PARTS EQUIPMENT PRIVATE EQUITY FUND | 54,893 | 29.9 | 16,398 | - | - | - | 16,398 | ||||||||||||||||||||
PCC-Woori LP Secondary Fund | 27,837 | 38.8 | 10,812 | - | - | 1 | 10,813 | ||||||||||||||||||||
Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 | 426,689 | 26.5 | 111,461 | - | - | - | 111,461 | ||||||||||||||||||||
Woori-Q Corporate Restructuring Private Equity Fund | 55,547 | 37.8 | 20,976 | - | - | - | 20,976 | ||||||||||||||||||||
Woori-Shinyoung Growth-Cap Private Equity Fund I | 197,892 | 35.0 | 69,202 | - | - | - | 69,202 |
(*1) | The net asset equity amount is after the debt-for-equity swap, non-controlling etc. |
(*2) | As a result of conducting an impairment test on the investment stocks of the related companies, the recoverable value was less than the carrying amount and thus the impairment loss was recognized. |
- 81 -
December 31, 2020 | ||||||||||||||||||||||||||||
Total net asset |
Ownership (%) |
Ownership portion of net assets |
Basis difference | Impairment |
Intercompany transaction |
Book value | ||||||||||||||||||||||
W Service Networks Co., Ltd. | 3,857 | 4.9 | 191 | - | - | - | 191 | |||||||||||||||||||||
Korea Credit Bureau Co., Ltd. | 79,478 | 9.9 | 7,876 | 246 | - | 3 | 8,125 | |||||||||||||||||||||
Korea Finance Security Co., Ltd. | 20,442 | 15.0 | 3,066 | - | - | - | 3,066 | |||||||||||||||||||||
Woori Growth Partnerships New Technology Private Equity Fund | 65,138 | 23.1 | 15,034 | - | - | (2 | ) | 15,032 | ||||||||||||||||||||
2016KIF-IMM Woori Bank Technology Venture Fund | 62,911 | 20.0 | 12,582 | - | - | 656 | 13,238 | |||||||||||||||||||||
K BANK Co., Ltd. (*1) (*2) | 509,978 | 26.2 | 133,614 | 44,117 | (3,634 | ) | - | 174,097 | ||||||||||||||||||||
Smart Private Equity Fund No. 2 (*2) | 13,616 | 20.0 | 2,723 | - | (1,242 | ) | - | 1,481 | ||||||||||||||||||||
Woori Bank-Company K Korea Movie Asset Fund | 11,154 | 25.0 | 2,788 | - | - | - | 2,788 | |||||||||||||||||||||
Well to Sea No.3 Private Equity Fund (*3) | 18,899 | 50.0 | - | - | - | - | - | |||||||||||||||||||||
Partner One Value Up Ist Private Equity Fund | 42,205 | 23.3 | 9,817 | - | - | (1 | ) | 9,816 | ||||||||||||||||||||
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership | 45,888 | 20.0 | 9,178 | - | - | 578 | 9,756 | |||||||||||||||||||||
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund | 15,747 | 25.0 | 3,937 | - | - | 192 | 4,129 | |||||||||||||||||||||
LOTTE CARD Co., Ltd (*1) | 2,114,159 | 20.0 | 422,832 | - | - | - | 422,832 | |||||||||||||||||||||
Together-Korea Government Private Pool Private Securities Investment Trust No. 3 | 10,024 | 100.0 | 10,024 | - | - | (1 | ) | 10,023 | ||||||||||||||||||||
Genesis Environmental Energy Company 1st Private Equity Fund | 16,074 | 24.8 | 3,979 | - | - | - | 3,979 | |||||||||||||||||||||
Union Technology Finance Investment Association | 15,100 | 29.7 | 4,485 | - | - | - | 4,485 | |||||||||||||||||||||
Japanese Hotel Real Estate Private Equity Fund 2 | 16,278 | 19.9 | 3,234 | - | - | - | 3,234 | |||||||||||||||||||||
Woori G Clean Energy No. 1 | 3,495 | 29.3 | 1,024 | - | - | - | 1,024 | |||||||||||||||||||||
Woori Goseong Power EBL Private Special Asset Fund | 90,707 | 16.7 | 15,118 | - | - | - | 15,118 | |||||||||||||||||||||
Woori Seoul Beltway Private Special Asset Fund | 22,451 | 25.0 | 5,613 | - | - | - | 5,613 | |||||||||||||||||||||
AJU TAERIM 1st Fund | 1,106 | 25.6 | 283 | - | - | - | 283 | |||||||||||||||||||||
Portone-Cape Fund No. 1 | 4,800 | 20.0 | 960 | - | - | - | 960 | |||||||||||||||||||||
KIWOOM PE AJU Investment Fund | 10,929 | 9.1 | 994 | - | - | - | 994 | |||||||||||||||||||||
Woori FirstValue Private Real Estate Fund No. 2 | 17,753 | 12.0 | 2,130 | - | - | - | 2,130 | |||||||||||||||||||||
Woori High plus G.B. Securities Feeder Fund 1 (G.B.) | 27,870 | 21.8 | 6,076 | - | - | - | 6,076 | |||||||||||||||||||||
Woori Star50 Master Fund Class C-F | 765 | 24.5 | 184 | - | - | - | 184 | |||||||||||||||||||||
Uri Hanhwa Eureka Private Equity Fund | 50,147 | 0.8 | 403 | - | - | - | 403 | |||||||||||||||||||||
Godo Kaisha Oceanos 1 | 21,321 | 47.8 | 10,193 | - | - | - | 10,193 | |||||||||||||||||||||
Force TEC | 1,526 | 25.8 | 393 | - | - | - | 393 | |||||||||||||||||||||
JC Assurance No. 2 Private Equity Fund | 98,418 | 29.3 | 29,050 | - | - | - | 29,050 | |||||||||||||||||||||
Dream Company Growth no. 1 PEF | 28,684 | 27.8 | 7,705 | - | - | - | 7,705 | |||||||||||||||||||||
HMS-Oriens 1st Fund | 52,632 | 22.8 | 12,000 | - | - | - | 12,000 | |||||||||||||||||||||
Woori G Senior Loan No. 1 | 240,399 | 21.7 | 52,045 | - | - | - | 52,045 | |||||||||||||||||||||
PCC-Woori LP Secondary Fund | 20,923 | 38.8 | 8,126 | - | - | 2 | 8,128 |
- 82 -
December 31, 2020 | ||||||||||||||||||||||||||||
Total net asset |
Ownership (%) |
Ownership portion of net assets |
Basis difference | Impairment |
Intercompany transaction |
Book value | ||||||||||||||||||||||
Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1 | 402,015 | 23.3 | 93,474 | - | - | - | 93,474 | |||||||||||||||||||||
Woori-Q Corporate Restructuring Private Equity Fund | 57,922 | 38.4 | 22,220 | - | - | 684 | 22,904 | |||||||||||||||||||||
Woori-Shinyoung Growth-Cap Private Equity Fund I | 109,627 | 35.0 | 38,342 | - | - | - | 38,342 |
(*1) | The net asset equity amount is after the debt-for-equity swap, non-controlling etc. |
(*2) | As a result of conducting an impairment test on the investment stocks of the related companies, the recoverable value was less than the carrying amount and thus the impairment loss was recognized. |
(*3) | The estimated recoverable amount of 15,687 million Won at the time of liquidation was classified as receivable. |
13. | INVESTMENT PROPERTIES |
(1) | Details of investment properties are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Acquisition cost | 410,586 | 409,702 | ||||||
Accumulated depreciation | (23,850 | ) | (22,152 | ) | ||||
Accumulated impairment losses | (86 | ) | (86 | ) | ||||
Net carrying value | 386,650 | 387,464 | ||||||
(2) | Changes in investment properties are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||
2021 | 2020 | |||||||
Beginning balance | 387,464 | 280,239 | ||||||
Acquisition | - | 1,514 | ||||||
Disposal | - | (354 | ) | |||||
Depreciation | (1,411 | ) | (1,087 | ) | ||||
Transfer | 2,497 | 31,681 | ||||||
Foreign currencies translation adjustments | (1,954 | ) | 430 | |||||
Others | 54 | 383 | ||||||
Ending balance | 386,650 | 312,806 | ||||||
- 83 -
14. | PREMISES AND EQUIPMENT |
(1) | Details of premises and equipment as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||||||||||||||
Land | Building |
Equipment and vehicles |
Leasehold improvement |
Construction in progress | Structures | Total | ||||||||||||||||||||||
Premises and equipment (owned) | 1,725,871 | 771,429 | 240,710 | 46,782 | 15,002 | 1 | 2,799,795 | |||||||||||||||||||||
Right-of-use asset |
- | 377,388 | 13,011 | - | - | - | 390,399 | |||||||||||||||||||||
Carrying value | 1,725,871 | 1,148,817 | 253,721 | 46,782 | 15,002 | 1 | 3,190,194 |
December 31, 2020 | ||||||||||||||||||||||||||||
Land | Building |
Equipment and vehicles |
Leasehold improvement |
Construction in progress | Structures | Total | ||||||||||||||||||||||
Premises and equipment (owned) | 1,726,045 | 787,040 | 268,225 | 50,085 | 8,246 | 2 | 2,839,643 | |||||||||||||||||||||
Right-of-use asset | - | 435,132 | 12,423 | - | - | - | 447,555 | |||||||||||||||||||||
Carrying value | 1,726,045 | 1,222,172 | 280,648 | 50,085 | 8,246 | 2 | 3,287,198 |
(2) | Details of premises and equipment (owned) as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||||||||||||||
Land | Building |
Equipment and vehicles |
Leasehold improvement |
Construction in progress | Structures | Total | ||||||||||||||||||||||
Acquisition cost | 1,726,531 | 1,076,347 | 1,126,536 | 467,066 | 15,002 | 20 | 4,411,502 | |||||||||||||||||||||
Accumulated depreciation | - | (304,918 | ) | (885,826 | ) | (420,284 | ) | - | (19 | ) | (1,611,047 | ) | ||||||||||||||||
Accumulated impairment losses | (660 | ) | - | - | - | - | - | (660 | ) | |||||||||||||||||||
Net carrying value | 1,725,871 | 771,429 | 240,710 | 46,782 | 15,002 | 1 | 2,799,795 | |||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||
Land | Building |
Equipment and vehicles |
Leasehold improvement |
Construction in progress | Structures | Total | ||||||||||||||||||||||
Acquisition cost | 1,726,705 | 1,076,647 | 1,142,653 | 478,290 | 8,246 | 20 | 4,432,561 | |||||||||||||||||||||
Accumulated depreciation | - | (289,607 | ) | (874,428 | ) | (428,205 | ) | - | (18 | ) | (1,592,258 | ) | ||||||||||||||||
Accumulated impairment losses | (660 | ) | - | - | - | - | - | (660 | ) | |||||||||||||||||||
Net carrying value | 1,726,045 | 787,040 | 268,225 | 50,085 | 8,246 | 2 | 2,839,643 | |||||||||||||||||||||
- 84 -
(3) | Details of changes in premises and equipment (owned) are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||||||
Land | Building |
Equipment and vehicles |
Leasehold improvement |
Construction in progress | Structures | Total | ||||||||||||||||||||||
Beginning balance | 1,726,045 | 787,040 | 268,225 | 50,085 | 8,246 | 2 | 2,839,643 | |||||||||||||||||||||
Acquisitions | - | 5,583 | 18,651 | 7,898 | 7,909 | - | 40,041 | |||||||||||||||||||||
Disposals | - | (7 | ) | (534 | ) | (767 | ) | - | - | (1,308 | ) | |||||||||||||||||
Depreciation | - | (16,926 | ) | (46,511 | ) | (10,636 | ) | - | (1 | ) | (74,074 | ) | ||||||||||||||||
Classified as held-for-sale | (759 | ) | (1,412 | ) | - | - | - | - | (2,171 | ) | ||||||||||||||||||
Transfer | (2,558 | ) | 61 | 191 | - | (191 | ) | - | (2,497 | ) | ||||||||||||||||||
Foreign currencies translation adjustments | 113 | 125 | 984 | 630 | 33 | - | 1,885 | |||||||||||||||||||||
Others | 3,030 | (3,035 | ) | (296 | ) | (428 | ) | (995 | ) | - | (1,724 | ) | ||||||||||||||||
Ending balance | 1,725,871 | 771,429 | 240,710 | 46,782 | 15,002 | 1 | 2,799,795 | |||||||||||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||||||
Land | Building |
Equipment and vehicles |
Leasehold improvement |
Construction in progress | Structures | Total | ||||||||||||||||||||||
Beginning balance | 1,761,159 | 802,299 | 278,016 | 54,839 | 1,287 | 2 | 2,897,602 | |||||||||||||||||||||
Acquisitions | 55 | 9,068 | 37,525 | 10,528 | 90 | - | 57,266 | |||||||||||||||||||||
Disposals | (6,422 | ) | (332 | ) | (804 | ) | (304 | ) | - | - | (7,862 | ) | ||||||||||||||||
Depreciation | - | (17,708 | ) | (46,975 | ) | (13,822 | ) | - | - | (78,505 | ) | |||||||||||||||||
Transfer | (30,518 | ) | (1,163 | ) | - | - | - | - | (31,681 | ) | ||||||||||||||||||
Foreign currencies translation adjustments | 207 | 178 | 1,529 | 583 | 25 | - | 2,522 | |||||||||||||||||||||
Others | - | (3,638 | ) | 984 | 1,236 | (539 | ) | - | (1,957 | ) | ||||||||||||||||||
Ending balance | 1,724,481 | 788,704 | 270,275 | 53,060 | 863 | 2 | 2,837,385 | |||||||||||||||||||||
(4) | Details of right-of-use assets as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||
Building | Equipment and vehicles | Total | ||||||||||
Acquisition cost | 687,241 | 29,248 | 716,489 | |||||||||
Accumulated depreciation | (309,853 | ) | (16,237 | ) | (326,090 | ) | ||||||
Net carrying value | 377,388 | 13,011 | 390,399 | |||||||||
December 31, 2020 | ||||||||||||
Building | Equipment and vehicles | Total | ||||||||||
Acquisition cost | 720,417 | 28,463 | 748,880 | |||||||||
Accumulated depreciation | (285,285 | ) | (16,040 | ) | (301,325 | ) | ||||||
Net carrying value | 435,132 | 12,423 | 447,555 | |||||||||
- 85 -
(5) | Details of changes in right-of-use assets for the six-month periods ended June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||
Building | Equipment and vehicles | Total | ||||||||||
Beginning balance | 435,132 | 12,423 | 447,555 | |||||||||
New contracts | 79,493 | 6,969 | 86,462 | |||||||||
Changes in contract | 1,385 | - | 1,385 | |||||||||
Termination | (36,763 | ) | (793 | ) | (37,556 | ) | ||||||
Depreciation | (117,665 | ) | (5,396 | ) | (123,061 | ) | ||||||
Others | 15,806 | (192 | ) | 15,614 | ||||||||
Ending balance | 377,388 | 13,011 | 390,399 | |||||||||
For the six-month period ended June 30, 2020 | ||||||||||||
Building | Equipment and vehicles | Total | ||||||||||
Beginning balance | 449,878 | 17,236 | 467,114 | |||||||||
New contracts | 111,610 | 3,158 | 114,768 | |||||||||
Changes in contract | 5,922 | 13 | 5,935 | |||||||||
Termination | (3,020 | ) | (282 | ) | (3,302 | ) | ||||||
Depreciation | (114,536 | ) | (5,026 | ) | (119,562 | ) | ||||||
Others | 8,598 | 73 | 8,671 | |||||||||
Ending balance | 458,452 | 15,172 | 473,624 | |||||||||
15. | INTANGIBLE ASSETS |
(1) | Details of intangible assets are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||||||||||||||
Goodwill |
Industrial property rights |
Development cost |
Other intangible assets |
Membership deposit |
Construction in progress | Total | ||||||||||||||||||||||
Acquisition cost | 336,980 | 1,810 | 620,549 | 1,139,462 | 40,161 | 740 | 2,139,702 | |||||||||||||||||||||
Accumulated amortization | - | (1,212 | ) | (414,315 | ) | (911,497 | ) | - | - | (1,327,024 | ) | |||||||||||||||||
Accumulated impairment losses | - | - | - | (33,552 | ) | (3,512 | ) | - | (37,064 | ) | ||||||||||||||||||
Net carrying value | 336,980 | 598 | 206,234 | 194,413 | 36,649 | 740 | 775,614 | |||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||
Goodwill |
Industrial property rights |
Development cost |
Other intangible assets |
Membership deposit |
Construction in progress | Total | ||||||||||||||||||||||
Acquisition cost | 334,290 | 1,810 | 582,998 | 1,114,615 | 39,454 | 6,669 | 2,079,836 | |||||||||||||||||||||
Accumulated amortization | - | (1,101 | ) | (374,125 | ) | (875,636 | ) | - | - | (1,250,862 | ) | |||||||||||||||||
Accumulated impairment losses | - | - | - | (33,534 | ) | (3,363 | ) | - | (36,897 | ) | ||||||||||||||||||
Net carrying value | 334,290 | 709 | 208,873 | 205,445 | 36,091 | 6,669 | 792,077 | |||||||||||||||||||||
- 86 -
(2) | Details of changes in intangible assets are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||||||
Goodwill |
Industrial property rights |
Development cost |
Other intangible assets |
Membership deposit |
Construction in progress | Total | ||||||||||||||||||||||
Beginning balance | 334,290 | 709 | 208,873 | 205,445 | 36,091 | 6,669 | 792,077 | |||||||||||||||||||||
Acquisitions | - | - | 33,807 | 18,253 | 1,097 | 237 | 53,394 | |||||||||||||||||||||
Disposal | - | - | - | (9 | ) | (316 | ) | - | (325 | ) | ||||||||||||||||||
Amortization (*) | - | (111 | ) | (40,196 | ) | (33,871 | ) | - | - | (74,178 | ) | |||||||||||||||||
Impairment losses | - | - | - | (18 | ) | (116 | ) | - | (134 | ) | ||||||||||||||||||
Transfer | - | - | 3,749 | 2,920 | - | (6,669 | ) | - | ||||||||||||||||||||
Foreign currencies translation adjustments | 3,193 | - | - | 878 | 92 | - | 4,163 | |||||||||||||||||||||
Others | (503 | ) | - | 1 | 815 | (199 | ) | 503 | 617 | |||||||||||||||||||
Ending balance | 336,980 | 598 | 206,234 | 194,413 | 36,649 | 740 | 775,614 | |||||||||||||||||||||
(*) | Amortization of other intangible assets amounting to 6,808 million Won is included in other operating expenses. |
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||||||
Goodwill |
Industrial property rights |
Development cost |
Other intangible assets |
Membership deposit |
Construction in progress | Total | ||||||||||||||||||||||
Beginning balance | 350,682 | 692 | 225,193 | 234,147 | 29,330 | 4,066 | 844,110 | |||||||||||||||||||||
Acquisitions | - | 123 | 27,060 | 15,124 | 3,903 | 273 | 46,483 | |||||||||||||||||||||
Disposal | - | - | - | - | (300 | ) | - | (300 | ) | |||||||||||||||||||
Amortization (*) | - | (104 | ) | (34,872 | ) | (32,706 | ) | - | - | (67,682 | ) | |||||||||||||||||
Impairment losses | - | - | - | (7,687 | ) | - | - | (7,687 | ) | |||||||||||||||||||
Transfer | - | - | 428 | - | - | (428 | ) | - | ||||||||||||||||||||
Foreign currencies translation adjustments | 5,348 | - | - | 891 | 63 | (3 | ) | 6,299 | ||||||||||||||||||||
Others | (1,626 | ) | - | - | 828 | (45 | ) | - | (843 | ) | ||||||||||||||||||
Ending balance | 354,404 | 711 | 217,809 | 210,597 | 32,951 | 3,908 | 820,380 | |||||||||||||||||||||
(*) | Amortization of other intangible assets amounting to 6,786 million Won is included in other operating expenses. |
16. | ASSETS HELD FOR SALE |
Assets held for sale are as follows (Unit: Korean Won in millions):
Assets (*) | June 30, 2021 | December 31, 2020 | ||||||
Premises and equipment | 1,507 | 2,130 | ||||||
Investments of associates | 27,389 | 50,411 | ||||||
Others | 6,599 | 7,461 | ||||||
Total | 35,495 | 60,002 | ||||||
(*) | The Group classifies assets as held for sale that are highly likely to be sold within one year from June 30, 2021 and December 31, 2020. |
The Group measured assets held for sale at the lower of their net fair value or carrying amount.
- 87 -
17. | OTHER ASSETS |
Details of other assets are as follows (Unit: Korean Won in millions):
June 30, 2021 | December 31, 2020 | |||||||
Lease assets | 1,309,466 | 1,116,175 | ||||||
Prepaid expenses | 202,771 | 170,820 | ||||||
Advance payments | 80,337 | 28,256 | ||||||
Assets for non-business use | 11,797 | 12,135 | ||||||
Others | 64,242 | 21,608 | ||||||
Total | 1,668,613 | 1,348,994 | ||||||
18. | FINANCIAL LIABILITIES AT FVTPL |
(1) | Financial liabilities at FVTPL are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Financial instruments at fair value through profit or loss measured at fair value | 3,928,181 | 6,794,192 | ||||||
Financial liabilities at fair value through profit or loss designated as upon initial recognition | - | 19,630 | ||||||
Total | 3,928,181 | 6,813,822 | ||||||
(2) | Financial liabilities at fair value through profit or loss measured at fair value are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Deposits | ||||||||
Gold banking liabilities | 70,394 | 49,279 | ||||||
Borrowings | ||||||||
Securities sold | 200,083 | 285,026 | ||||||
Derivative liabilities | 3,657,704 | 6,459,887 | ||||||
Total | 3,928,181 | 6,794,192 | ||||||
(3) | Financial liabilities at fair value through profit or loss designated as upon initial recognition as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Equity-linked securities | ||||||||
Equity-linked securities in short position | - | 19,630 |
The Group designated the financial liability at a fair value through profit or loss since the financial liability is a compound contract that includes one or more embedded derivatives which IFRS 1109 'Financial Instruments' allows designation of fair value through profit or loss.
(4) | There are no accumulated changes in credit risk adjustments to financial liabilities at fair value through profit or loss designated as upon initial recognition. |
The adjustment to reflect the Group's credit risk is considered in measuring the fair value of equity-linked securities index. The Group's credit risk is determined by adjusting credit spread observed in credit rating of the Group.
- 88 -
(5) | The difference between carrying amount and maturity amount of financial liabilities at fair value through profit or loss designated as upon initial recognition (Financial liabilities designated as at FVTPL) are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Carrying amount | - | 19,630 | ||||||
Nominal amount at maturity | - | 25,780 | ||||||
Difference | - | (6,150 | ) | |||||
19. | DEPOSITS DUE TO CUSTOMERS |
Details of deposits due to customers by type are as follows (Unit: Korean Won in millions):
June 30, 2021 | December 31, 2020 | |||||||
Deposits in local currency | ||||||||
Deposits on demand | 15,488,268 | 12,454,024 | ||||||
Deposits at termination | 246,597,694 | 242,397,664 | ||||||
Mutual installment | 25,255 | 26,319 | ||||||
Deposits on notes payables | 2,853,778 | 2,647,492 | ||||||
Deposits on CMA | 109,792 | 110,413 | ||||||
Certificate of deposits | 2,917,776 | 2,072,389 | ||||||
Other deposits | 1,333,476 | 1,372,461 | ||||||
Sub-total | 269,326,039 | 261,080,762 | ||||||
Deposits in foreign currencies | ||||||||
Deposits in foreign currencies | 33,178,205 | 30,408,762 | ||||||
Present value discount | (11,568 | ) | (12,245 | ) | ||||
Total | 302,492,676 | 291,477,279 | ||||||
20. | BORROWINGS AND DEBENTURES |
(1) | Details of borrowings are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||
Lenders | Interest rate (%) | Amount | ||||||||
Borrowings in local currency | ||||||||||
Borrowings from BOK | BOK | 0.3 | 3,080,866 | |||||||
Borrowings from government funds | Small Enterprise And Market Service and others | 0.0 ~ 3.5 | 2,134,443 | |||||||
Others | The Korea Development Bank and others | 0.0 ~ 4.0 | 8,446,343 | |||||||
Sub-total | 13,661,652 | |||||||||
Borrowings in foreign currencies | ||||||||||
Borrowings in foreign currencies | JPMorgan Chase & Co. and others | (0.5) ~ 7.3 | 7,755,408 | |||||||
Sub-total | 7,755,408 | |||||||||
Bills sold | Others | 0.0 ~ 0.9 | 8,530 | |||||||
Call money | Bank and others | 0.0 ~ 2.2 | 274,484 | |||||||
Bonds sold under repurchase agreements | Other financial institutions | (0.5) ~ 10.6 | 856,544 | |||||||
Present value discount | (10,756 | ) | ||||||||
Total | 22,545,862 | |||||||||
- 89 -
December 31, 2020 | ||||||||||
Lenders | Interest rate (%) | Amount | ||||||||
Borrowings in local currency | ||||||||||
Borrowings from BOK | BOK | 0.3 | 2,678,120 | |||||||
Borrowings from government funds | Small Enterprise And Market Service and others | 0.0 ~ 5.0 | 2,155,129 | |||||||
Others | The Korea Development Bank and others | 0.0 ~ 5.5 | 7,255,938 | |||||||
Sub-total | 12,089,187 | |||||||||
Borrowings in foreign currencies | ||||||||||
Borrowings in foreign currencies | JPMorgan Chase & Co. and others | (0.4) ~ 7.3 | 7,573,722 | |||||||
Bills sold | Others | 0.0 ~ 0.9 | 8,924 | |||||||
Call money | Bank and others | (0.3) ~ 3.8 | 416,370 | |||||||
Bonds sold under repurchase agreements | Other financial institutions | (0.5) ~ 10.6 | 657,823 | |||||||
Present value discount | (560 | ) | ||||||||
Total | 20,745,466 | |||||||||
(2) | Details of debentures are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||||||||||
Interest rate (%) | Amount |
Interest rate (%) | Amount | |||||||||||||
Face value of bond (*): | ||||||||||||||||
Ordinary bonds | 0.8 ~ 4.5 | 33,386,279 | 0.8 ~ 4.5 | 29,623,445 | ||||||||||||
Subordinated bonds | 1.9 ~ 5.1 | 6,726,101 | 1.9 ~ 5.9 | 6,955,515 | ||||||||||||
Other bonds | 0.6 ~ 17.0 | 835,107 | 0.6 ~ 17.0 | 925,677 | ||||||||||||
Sub-total | 40,947,487 | 37,504,637 | ||||||||||||||
Discounts on bonds | (29,535 | ) | (25,279 | ) | ||||||||||||
Total | 40,917,952 | 37,479,358 | ||||||||||||||
(*) | Included debentures under fair value hedge amounting to 2,862,453 million Won and 2,767,208 million Won as of June 30, 2021 and December 31, 2020 respectively. Also, debentures under cash flow hedge amounting to 792,563 million Won and 857,531 million Won are included as of June 30, 2021 and December 31, 2020 respectively. |
- 90 -
21. | PROVISIONS |
(1) | Details of provisions are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Asset retirement obligation | 80,976 | 68,402 | ||||||
Provisions for guarantees (*1) | 76,735 | 89,592 | ||||||
Provisions for unused loan commitments | 111,858 | 122,155 | ||||||
Other provisions (*2) | 230,928 | 221,494 | ||||||
Total | 500,497 | 501,643 | ||||||
(*1) | Provisions for guarantees includes provision for financial guarantee of 59,925 million Won and 66,232 million Won as of June 30, 2021 and December 31, 2020, respectively. |
(*2) | Other provisions consist of provision for litigation, loss compensation and others. |
(2) | Changes in provisions for guarantees and unused loan commitments are as follows (Unit: Korean Won in millions): |
1) | Provisions for guarantees |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 64,804 | 16,745 | 8,043 | 89,592 | ||||||||||||
Transfer to 12-month expected credit loss | 2,219 | (2,219 | ) | - | - | |||||||||||
Transfer to expected credit loss for the entire period | (218 | ) | 218 | - | - | |||||||||||
Transfer to credit-impaired financial assets | (39 | ) | - | 39 | - | |||||||||||
Provisions used | (3,155 | ) | - | - | (3,155 | ) | ||||||||||
Net provision (reversal) of unused amount | (3,177 | ) | (6,423 | ) | 2,003 | (7,597 | ) | |||||||||
Others (*) | (2,109 | ) | 4 | - | (2,105 | ) | ||||||||||
Ending balance | 58,325 | 8,325 | 10,085 | 76,735 | ||||||||||||
(*) | Others have occurred as a result of new financial guarantee contract valued at initial fair value. |
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 50,801 | 26,303 | 15,382 | 92,486 | ||||||||||||
Transfer to 12-month expected credit loss | 120 | (120 | ) | - | - | |||||||||||
Transfer to expected credit loss for the entire period | (718 | ) | 1,961 | (1,243 | ) | - | ||||||||||
Transfer to credit-impaired financial assets | (40 | ) | (32 | ) | 72 | - | ||||||||||
Net provision (reversal) of unused amount | 2,184 | (3,807 | ) | 5,595 | 3,972 | |||||||||||
Others (*) | (1,788 | ) | - | - | (1,788 | ) | ||||||||||
Ending balance | 50,559 | 24,305 | 19,806 | 94,670 | ||||||||||||
(*) | Others have occurred as a result of new financial guarantee contract valued at initial fair value. |
- 91 -
2) | Provisions for unused loan commitment |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 63,240 | 55,726 | 3,189 | 122,155 | ||||||||||||
Transfer to 12-month expected credit loss | 12,672 | (12,348 | ) | (324 | ) | - | ||||||||||
Transfer to expected credit loss for the entire period | (2,834 | ) | 3,489 | (655 | ) | - | ||||||||||
Transfer to credit-impaired financial assets | (120 | ) | (299 | ) | 419 | - | ||||||||||
Net provision (reversal) of unused amount | (12,007 | ) | 2,001 | (340 | ) | (10,346 | ) | |||||||||
Others | 49 | - | - | 49 | ||||||||||||
Ending balance | 61,000 | 48,569 | 2,289 | 111,858 | ||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||
Beginning balance | 65,038 | 43,164 | 4,352 | 112,554 | ||||||||||||
Transfer to 12-month expected credit loss | 5,533 | (5,387 | ) | (146 | ) | - | ||||||||||
Transfer to expected credit loss for the entire period | (1,880 | ) | 2,374 | (494 | ) | - | ||||||||||
Transfer to credit-impaired financial assets | (134 | ) | (194 | ) | 328 | - | ||||||||||
Net provision (reversal) of unused amount | 4,336 | 16,159 | (683 | ) | 19,812 | |||||||||||
Others | 43 | - | - | 43 | ||||||||||||
Ending balance | 72,936 | 56,116 | 3,357 | 132,409 | ||||||||||||
(3) | Changes in asset retirement obligation for the six-month periods ended June 30, 2021 and 2020, obligation are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||
2021 | 2020 | |||||||
Beginning balance | 68,402 | 66,485 | ||||||
Provisions provided | 612 | 2,442 | ||||||
Provisions used | (3,055 | ) | (548 | ) | ||||
Reversal of provisions unused | (112 | ) | (94 | ) | ||||
Unwinding of discount | 218 | 234 | ||||||
Increase in recovery cost and others | 14,911 | - | ||||||
Ending balance | 80,976 | 68,519 | ||||||
The amount of the asset retirement obligation is the present value of the best estimate of future expected expenditure to settle the obligation - arising from leased premises as of June 30, 2021, discounted by appropriate discount rate. The restoration cost is expected to occur by the end of each premise's lease period, and the Group has used average lease period of each category of leases terminated during the past years in order to rationally estimate the lease period. In addition, the Group used average amount of actual recovery cost for the past 3 years and the inflation rate for last year in order to estimate future recovery cost.
- 92 -
(4) | Changes in other provisions for the six-month periods ended June 30, 2021 and 2020, are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||
2021 | 2020 | |||||||
Beginning balance | 221,494 | 172,455 | ||||||
Provisions provided | 14,651 | 169,338 | ||||||
Provisions used | (7,899 | ) | (87,260 | ) | ||||
Reversal of provisions unused | (537 | ) | (30 | ) | ||||
Foreign currencies translation adjustments | 3,113 | 1,374 | ||||||
Others | 106 | (86 | ) | |||||
Ending balance | 230,928 | 255,791 | ||||||
(5) | Others |
1) | The Group has been offering Korean Won settlement services for trade with Korea and Iran; however, the Group has stopped the services for trade in line with U.S. economic sanctions on September 23, 2019. The Group resumed the service humanitarian goods trade only since July 13, 2020. In connection with these services, the Group is currently being investigated by the U.S. government agencies including the U.S. prosecutors (United States Attorney's Office and New York State Attorney General's Office) and New York State Financial Supervisory Service as to whether the Group has violated United States laws by participating in prohibited transactions involving the following countries: Iran, Sudan, Syria and Cuba, which have been sanctioned by the U.S. In this regard, Office of Foreign Assets Control concluded its investigation in December 2020 without taking any additional sanctions, but the investigation procedures of the U.S. Public Prosecutors' Office and the New York State Financial Supervisory Service have yet to be completed. |
2) | The Group recognized the provision of the estimated compensation amount related to the miss-selling of the Derivative Linked Fund (DLF) incurred during 2019 and a fine expected to be imposed by the Financial Supervisory Service as the best estimate for the expenditure required to meet its obligations at the end of the reporting period. |
3) | For the six-month period ended June 30, 2021, the Group recognized the provisions for the required expenditure as the best estimate to fulfill its obligations as of June 30, 2021 due to the expected losses of clients arising from the delay in the redemption of funds by Lime Asset Management and the dispute settlement by the Financial Supervisory Service. As of June 30, 2021, the provision for this case is 117.8 billion Won and the advance payment is 124.8 billion Won. |
- 93 -
22. | NET DEFINED BENEFIT LIABILITY (ASSET) |
The characteristics of the Group's defined benefit retirement pension plans are as follows:
Employees and directors with one or more years of service are entitled to receive a payment upon termination of their employment, based on their length of service and rate of salary at the time of termination. The assets of the plans are measured at their fair value at the end of reporting date. The plan liabilities are measured using the projected unit method, which takes account of projected earnings increases, using actuarial assumptions that give the best estimate of the future cash flows that will arise under the plan liabilities.
The Group is exposed to various risks through defined benefit retirement pension plan, and the most significant risks are as follows:
Volatility of asset | The defined benefit obligation was estimated with an interest rate calculated based on blue chip corporate bonds earnings. A deficit may occur if the rate of return of plan assets falls short of the interest rate. | |
Decrease in profitability of blue-chip bonds | A decrease in profitability of blue-chip bonds will be offset by some increase in the value of debt securities that the employee benefit plan owns but will bring an increase in the defined benefit obligation. | |
Risk of inflation | Defined benefit obligations are related to inflation rate; the higher the inflation rate is, the higher the level of liabilities. Therefore, deficit occurs in the system if an inflation rate increases. |
(1) | Details of net defined benefit liability are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Present value of defined benefit obligation | 1,600,644 | 1,610,680 | ||||||
Fair value of plan assets | (1,544,717 | ) | (1,564,101 | ) | ||||
Net defined benefit liabilities (*) | 55,927 | 46,579 | ||||||
(*) | Net defined benefit liability of 55,927 million Won and 46,579 million Won as of June 30, 2021 and December 31, 2020 is the subtracted amount of the net defined benefit asset of 1,809 million Won 5,658 million Won from the net defined benefit liability of 57,736 million Won and 52,237 million Won. |
(2) | Changes in the carrying value of defined benefit obligation are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||||
2021 | 2020 | |||||||||
Beginning balance | 1,610,680 | 1,442,859 | ||||||||
Current service cost | 89,184 | 86,569 | ||||||||
Interest cost | 19,897 | 16,768 | ||||||||
Remeasurements | Financial assumption | (57,040 | ) | 15,857 | ||||||
Demographic assumptions | - | - | ||||||||
Experience adjustments | 30,247 | 16,264 | ||||||||
Retirement benefit paid | (92,981 | ) | (47,118 | ) | ||||||
Foreign currencies translation adjustments | 22 | 43 | ||||||||
Others | 635 | 1,253 | ||||||||
Ending balance | 1,600,644 | 1,532,495 | ||||||||
- 94 -
(3) | Changes in the plan assets are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||
2021 | 2020 | |||||||
Beginning balance | 1,564,101 | 1,352,971 | ||||||
Interest income | 20,418 | 17,152 | ||||||
Remeasurements | (8,030 | ) | (4,073 | ) | ||||
Employer's contributions | 61,009 | 66,809 | ||||||
Retirement benefit paid | (92,811 | ) | (46,725 | ) | ||||
Others | 30 | 36 | ||||||
Ending balance | 1,544,717 | 1,386,170 | ||||||
(4) | Fair value of plan assets as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Cash and due from banks | 1,544,717 | 1,564,101 |
Meanwhile, among plan assets, realized returns on plan assets amount to 12,388 million Won and 13,079 million Won for the six-month periods ended June 30, 2021 and 2020, respectively.
(5) | Current service cost, net interest income, loss(gain) on the curtailment or settlement and remeasurements recognized in the consolidated statements comprehensive income are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||
2021 | 2020 | |||||||
Current service cost | 89,184 | 86,569 | ||||||
Net interest expense(income) | (521 | ) | (384 | ) | ||||
Cost recognized in net income | 88,663 | 86,185 | ||||||
Remeasurements (*) | (18,763 | ) | 36,194 | |||||
Cost recognized in total comprehensive income | 69,900 | 122,379 | ||||||
(*) | Amount before tax |
Meanwhile, retirement benefits related to defined contribution plans recognized as expenses are 2,339 million Won and 2,022 million Won for the six-month periods ended June 30, 2021 and 2020, respectively.
- 95 -
23. | OTHER FINANCIAL LIABILITIES AND OTHER LIABILITIES |
Other financial liabilities and other liabilities are as follows (Unit: Korean Won in millions):
June 30, 2021 | December 31, 2020 | |||||||
Other financial liabilities: | ||||||||
Accounts payable | 6,597,639 | 4,028,639 | ||||||
Accrued expenses | 1,595,324 | 2,049,401 | ||||||
Borrowings from trust accounts | 2,986,765 | 2,984,031 | ||||||
Agency business revenue | 500,048 | 466,485 | ||||||
Foreign exchange payables | 738,204 | 789,189 | ||||||
Domestic exchange settlement credits | 5,289,346 | 180,251 | ||||||
Lease liabilities | 341,419 | 407,431 | ||||||
Other miscellaneous financial liabilities | 3,512,757 | 3,317,358 | ||||||
Present value discount | (11,748 | ) | (6,968 | ) | ||||
Sub-total | 21,549,754 | 14,215,817 | ||||||
Other liabilities: | ||||||||
Unearned income | 260,785 | 254,702 | ||||||
Other miscellaneous liabilities | 210,749 | 219,111 | ||||||
Sub-total | 471,534 | 473,813 | ||||||
Total | 22,021,288 | 14,689,630 | ||||||
- 96 -
24. | DERIVATIVES |
(1) | Derivative assets and derivative liabilities are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||||||||||||||
Assets | Liabilities | |||||||||||||||||||||||||||
Nominal amount |
For cash flow hedge |
For fair value hedge | For trading |
For cash flow hedge |
For fair value hedge | For trading | ||||||||||||||||||||||
Interest rate: | ||||||||||||||||||||||||||||
Futures | 278,086 | - | - | - | - | - | - | |||||||||||||||||||||
Swaps | 134,262,286 | - | 129,562 | 188,490 | 205 | 10,112 | 397,788 | |||||||||||||||||||||
Purchase options | 210,000 | - | - | 4,485 | - | - | - | |||||||||||||||||||||
Written options | 340,000 | - | - | - | - | - | 8,334 | |||||||||||||||||||||
Currency: | ||||||||||||||||||||||||||||
Futures | 36,126 | - | - | - | - | - | - | |||||||||||||||||||||
Forwards | 111,145,688 | - | - | 1,460,534 | - | 479 | 913,417 | |||||||||||||||||||||
Swaps | 95,610,795 | - | - | 1,569,192 | 33,249 | - | 1,372,358 | |||||||||||||||||||||
Purchase options | 1,186,337 | - | - | 6,841 | - | - | - | |||||||||||||||||||||
Written options | 1,990,306 | - | - | - | - | - | 7,646 | |||||||||||||||||||||
Equity: | ||||||||||||||||||||||||||||
Futures | 364,673 | - | - | - | - | - | - | |||||||||||||||||||||
Forwards | 11 | - | - | - | - | - | - | |||||||||||||||||||||
Swaps | 553,138 | - | - | 351 | - | - | 22,151 | |||||||||||||||||||||
Purchase options | 13,727,313 | - | - | 794,775 | - | - | - | |||||||||||||||||||||
Written options | 14,878,040 | - | - | - | - | - | 936,010 | |||||||||||||||||||||
Total | 374,582,799 | - | 129,562 | 4,024,668 | 33,454 | 10,591 | 3,657,704 | |||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||
Assets | Liabilities | |||||||||||||||||||||||||||
Nominal amount |
For cash flow hedge |
For fair value hedge | For trading |
For cash flow hedge |
For fair value hedge | For trading | ||||||||||||||||||||||
Interest rate: | ||||||||||||||||||||||||||||
Futures | 184,413 | - | - | - | - | - | - | |||||||||||||||||||||
Swaps | 137,057,240 | - | 174,820 | 318,545 | 1,476 | 28 | 524,190 | |||||||||||||||||||||
Purchase options | 330,000 | - | - | 6,271 | - | - | - | |||||||||||||||||||||
Written options | 285,440 | - | - | - | - | - | 5,419 | |||||||||||||||||||||
Currency: | ||||||||||||||||||||||||||||
Futures | 2,546 | - | - | - | - | - | - | |||||||||||||||||||||
Forwards | 105,146,634 | - | - | 2,541,957 | - | - | 2,848,980 | |||||||||||||||||||||
Swaps | 87,249,320 | - | - | 3,325,135 | 63,265 | - | 2,415,610 | |||||||||||||||||||||
Purchase options | 1,147,877 | - | - | 59,329 | - | - | - | |||||||||||||||||||||
Written options | 1,632,048 | - | - | - | - | - | 23,271 | |||||||||||||||||||||
Equity: | ||||||||||||||||||||||||||||
Futures | 123,742 | - | - | - | - | - | - | |||||||||||||||||||||
Forwards | 11 | - | - | - | - | - | - | |||||||||||||||||||||
Swaps | 269,039 | - | - | - | - | - | 12,533 | |||||||||||||||||||||
Purchase options | 9,863,110 | - | - | 650,505 | - | - | - | |||||||||||||||||||||
Written options | 10,369,009 | - | - | - | - | - | 629,884 | |||||||||||||||||||||
Total | 353,660,429 | - | 174,820 | 6,901,742 | 64,741 | 28 | 6,459,887 | |||||||||||||||||||||
Derivatives held for trading are classified into financial assets at FVTPL (Note 7) and financial liabilities at FVTPL (Note 18), and derivatives designated for hedging are presented as a separate line item in the consolidated statements of financial position.
- 97 -
(2) | Overview of the Group's hedge accounting |
The hedging relationships that the Group applies fair value hedge accounting and cash flow hedge accounting to are affected by interest rate which is related with Interest Rate Benchmark Reform. The interest rates to which the hedging relationships are exposed are USD 1M LIBOR, USD 3M LIBOR and AUD 3M BBSW. The nominal amounts of hedging instruments related to 1M LIBOR, 3M LIBOR and 3M BBSW in the hedging relationships of the Group are USD 470,000,000, USD 2,350,000,000 and AUD 150,000,000, respectively. The Group pays close attention to discussions in the market and industry regarding the applicable alternative benchmark interest rates for the exposed interest rate. The Group determined that such uncertainty is expected to be no longer exist when the exposed interest rates are replaced by the applicable benchmark interest rates.
1) | Fair value hedge |
As of the June 30, 2021, the Group has applied fair value hedge on fixed interest rate foreign currency denominated debentures amounting to 2,862,453 million Won. It is the Group's hedging strategy to hedge changes in fair value of fixed rate debentures denominated in foreign currency attributable to fluctuations in market interest rates, and as such the Group entered into interest rate swap agreements designated as hedging instruments.
Pursuant to the interest rate swap agreement, by swapping the calculated difference between the fixed interest rate and floating interest rate applied to the nominal value, the fair value fluctuation risk is hedged as the foreign currency denominated debentures fixed interest rate terms are converted to floating interest rate. Pursuant to the interest rate swap agreement, hedge ratio is determined by matching the nominal value of hedging instrument to the face value of the hedged item.
In this hedging relationship, only the market interest rate fluctuation, which is the most significant part of the fair value change of the hedged item, is designated as the hedged risk, and other risk factors including credit risk are not included in the hedged risk. Therefore, the ineffective portion of the hedge could arise from fluctuations in the timing of the cash flow of the hedged item, price margin set by counterparty of hedging instrument, and unilateral change in credit risk of any party of hedging instrument.
The interest rate swap agreements and the hedged items are subject to fluctuations in the underlying market rate of interest and the Group expects the fair value of the interest rate swap contract and the value of the hedged item to generally change in the opposite direction.
The fair value of the interest rate swap at the end of the reporting period is determined by discounting future cash flows estimated by using the yield curve at the end of the reporting period and the credit risk embedded in the contract and the average interest rate is determined based on the outstanding balance at the end of the reporting period. The variable interest rate applied to the interest rate swap is USD Libor 3M plus spread and AUD BBSW 3M plus spread. In accordance with the terms of each interest rate swap contract designated as a hedging instrument, the Group receives interest at a fixed interest rate and pays interest at a variable interest rate.
In addition, as of June 30, 2021, the Group has applied fair value hedge for 13,874 million Won of equity securities in foreign currencies. It is the Group's hedging strategy to hedge changes in fair value of equity securities in foreign currencies invested in EUR attributable to fluctuations in spot exchange rates (USD/EUR), and as such the Group entered into forward exchange agreements designated as hedging instruments. By recognizing the difference calculated by applying the difference in spot exchange rate to a predetermined nominal amount under a forward exchange agreement, the resulting nominal amount is converted from EUR to USD at maturity and the risk of changes in fair value is eliminated. In this hedging relationship, only changes in the fair value of the hedged item are designated as the hedged risk, and other risk factors, including credit risk, are not included in the hedged risk. Consequently, changes in the price margins of the hedging instrument counterparty and the credit risk of either party to the hedging instrument may result in hedge ineffectiveness. Forward exchange agreements and hedged items are affected by changes in spot exchange rates, which are fundamental variables.
- 98 -
2) | Cash Flow Hedge |
As of the June 30, 2021, the Group has applied cash flow hedge on local currency denominated debentures amounting to 149,957 million Won, debentures on foreign currency amounting to 642,606 million Won. The Group's hedging strategies are to ① Mitigate risks of cash flow fluctuation from variable interest rate debentures on local currency due to changes in market interest rate by entering into an interest rate swap contract and thereby designating it as hedging instrument; ② Mitigate the risks of cash flow fluctuation from principal and interest of variable interest rate debentures denominated in foreign currency due to changes in foreign exchange rates and interest rates by entering into a currency swap contract and thereby designating it as hedging instrument; ③ Mitigate the risks of cash flow fluctuation from principal and interest of fixed interest rate debentures denominated in foreign currency due to changes in foreign exchange rates by entering into a currency swap contract and thereby designating it as hedging instrument and ④ Mitigate the risks of cash flow fluctuation in variable interest rate foreign currency borrowings resulting from changes in market interest rates and designate it as a hedging instrument through entering into currency swap contracts and interest rate swap contracts.
This means exchanging a predetermined nominal amount as set forth in the interest rate swap contract adjusted by the differences between the fixed and variable interest rates, which results in the conversion of interest rates of debentures in local currency from variable interest into fixed interest, eliminating the cash flow fluctuation risk.
In addition, this also means a payment of predetermined principal amount as set forth in the currency swap adjusted by fixed interest rate, an exchange of an amount calculated by applying variable interest rate to USD or applying fixed interest rate to SGD, and an exchange of the principal denominated in KRW and principal denominated in foreign currency at maturity eliminating cash flow fluctuation risk on principal and interest.
The hedge ratio is determined by matching the nominal amount of the hedging instrument to the face amount of the hedged item in accordance with interest rate swap and currency swap.
Only interest rate and foreign exchange rate fluctuation risk, which is the most significant factor in the cash flow fluctuation of the hedged item, is addressed in this hedging relationship, and other risk factors such as credit risk are not subject to hedging.
Accordingly, hedge ineffectiveness may arise from price margin set by the counterparty of hedging instruments and unilateral change in credit risk of any party in the transaction.
The interest rate swap, currency swap contract and the hedged item are all affected by the changes in market interest rate and foreign exchange rates which are basic factors of the derivative. The Group expects that the value of interest rate swap contract, currency swap contract and value of the hedged item will generally fluctuate in opposite direction.
- 99 -
(3) | The nominal amounts of the hedging instrument are as follows (Unit: USD, AUD, EUR, SGD and Korean Won in millions): |
June 30, 2021 | ||||||||||||||||
1 year or less | 1 year to 5 years |
More than 5 years | Total | |||||||||||||
Fair value hedge | ||||||||||||||||
Interest rate risk | ||||||||||||||||
Interest rate swap (USD) | 500,000,000 | 1,550,000,000 | 300,000,000 | 2,350,000,000 | ||||||||||||
Interest rate swap (AUD) | - | 150,000,000 | - | 150,000,000 | ||||||||||||
Foreign exchange rate risk | ||||||||||||||||
Currency forward (EUR/USD) | - | - | 10,313,901 | 10,313,901 | ||||||||||||
Cash flow hedge | ||||||||||||||||
Interest rate risk | ||||||||||||||||
Interest rate swap (KRW) | 100,000 | 50,000 | - | 150,000 | ||||||||||||
Foreign currencies translation risk and interest rate risk | ||||||||||||||||
Currency swap (USD) | - | 470,000,000 | - | 470,000,000 | ||||||||||||
Foreign currencies translation risk | ||||||||||||||||
Currency swap (USD) | - | 100,000,000 | - | 100,000,000 |
December 31, 2020 | ||||||||||||||||
1 year or less | 1 year to 5 years |
More than 5 years | Total | |||||||||||||
Fair value hedge | ||||||||||||||||
Interest rate risk | ||||||||||||||||
Interest rate swap (USD) | 1,000,000,000 | 1,000,000,000 | 300,000,000 | 2,300,000,000 | ||||||||||||
Interest rate swap (AUD) | - | 150,000,000 | - | 150,000,000 | ||||||||||||
Cash flow hedge | ||||||||||||||||
Interest rate risk | ||||||||||||||||
Interest rate swap (KRW) | 100,000 | 50,000 | - | 150,000 | ||||||||||||
Foreign currencies translation risk and interest rate risk | ||||||||||||||||
Currency swap (USD) | 130,000,000 | 470,000,000 | - | 600,000,000 | ||||||||||||
Foreign currencies translation risk | ||||||||||||||||
Currency swap (SGD) | 68,000,000 | - | - | 68,000,000 |
- 100 -
(4) | The average interest rate and average currency rate of the hedging instrument as of June 30, 2021 and December 31, 2020 are as follows: |
June 30, 2021 | ||
Average interest rate and average exchange rate | ||
Fair value hedge | ||
Interest rate risk | ||
Interest rate swap (USD) | Fixed 3.41%% receipt and Libor 3M + 1.51% floating paid | |
Interest rate swap (AUD) | Fixed 0.84% receipt and BBSW 3M+0.72% paid | |
Foreign exchange rate risk | ||
Currency forward (EUR/USD) | USD 13,369,910 receipt and EUR 10,313,901 paid | |
Cash flow hedge | ||
Interest rate risk | ||
Interest rate swap (KRW) | KRW 3Y CMS+0.40% receipt, 2.38% paid KRW CD+0.73% receipt, 1.90% paid | |
Foreign currencies translation risk and interest rate risk | ||
Currency swap (USD) | USD 1M Libor+0.70% receipt, KRW 0.93% paid, USD/KRW = 1,207 | |
Foreign currencies translation risk | ||
Currency swap (USD) | USD 1.75% receipt, KRW 1.63% paid, USD/KRW = 1,139 |
December 31, 2020 | ||
Average interest rate and average exchange rate | ||
Fair value hedge | ||
Interest rate risk | ||
Interest rate swap (USD) | Fixed 4.22% receipt and Libor 3M+1.71% floating paid Fixed 5.88% receipt and Libor 6M+2.15% floating paid | |
Interest rate swap (AUD) | Fixed 0.84% receipt and BBSW 3M+0.72% paid | |
Cash flow hedge | ||
Interest rate risk | ||
Interest rate swap (KRW) | KRW 3Y CMS+0.40% receipt, 2.38% paid KRW CD+0.69% receipt, 2.06% paid KRW CD+0.33% receipt, 1.68% paid | |
Foreign currencies translation risk and interest rate risk | ||
Currency swap (USD) | USD 3M Libor+0.80% receipt, KRW 1.45% paid, USD/KRW = 1,155 USD 1M Libor+0.67% receipt, KRW 1.14% paid, USD/KRW = 1,190 USD 1M Libor+0.69% receipt, KRW 1.02% paid, USD/KRW = 1,199 | |
Foreign currencies translation risk | ||
Currency swap (SGD) | SGD 1.91% receipt, KRW 1.98% paid, SGD/KRW = 827 |
- 101 -
(5) | The amounts related to items designated as hedging instruments are as follows (Unit: Korean Won in millions, USD, AUD, EUR and SGD): |
June 30, 2021 | ||||||||||||||||||||
Nominal amounts of the hedging instrument |
Carrying amounts of the hedging instrument |
Line item in the statement of financial position where the hedging instrument is located |
Changing in fair value used for calculating hedge ineffectiveness | |||||||||||||||||
Assets | Liabilities | |||||||||||||||||||
Fair value hedge | ||||||||||||||||||||
Interest rate risk | ||||||||||||||||||||
Interest rate swap | USD 2,350,000,000 |
Derivative assets (designated for hedging) | ||||||||||||||||||
Interest rate swap | AUD 150,000,000 | 129,562 | 10,112 |
Derivative liabilities (designated for hedging) | (47,455 | ) | ||||||||||||||
Foreign exchange rate risk | ||||||||||||||||||||
Forward exchange | EUR 10,313,901 | - | 479 |
Derivative liabilities (designated for hedging) | 479 | |||||||||||||||
Cash flow hedge | ||||||||||||||||||||
Interest rate risk | ||||||||||||||||||||
Interest rate swap | KRW 150,000 | - | 205 |
Derivative liabilities (designated for hedging) | 1,271 | |||||||||||||||
Foreign currency translation risk and interest rate risk | ||||||||||||||||||||
Currency swap | USD 470,000,000 | - | 32,431 |
Derivative liabilities (designated for hedging) | 31,127 | |||||||||||||||
Foreign currency translation risk | ||||||||||||||||||||
Currency swap | USD 100,000,000 | - | 818 |
Derivative liabilities (designated for hedging) | 359 |
December 31, 2020 | ||||||||||||||||||||
Nominal amounts of the hedging instrument |
Carrying amounts of the hedging instrument |
Line item in the statement of financial position where the hedging instrument is located |
Changing in fair value used for calculating hedge ineffectiveness | |||||||||||||||||
Assets | Liabilities | |||||||||||||||||||
Fair value hedge | ||||||||||||||||||||
Interest rate risk | ||||||||||||||||||||
Interest rate swap | USD 2,300,000,000 |
Derivative assets (designated for hedging) | ||||||||||||||||||
Interest rate swap | AUD 150,000,000 | 174,820 | 28 |
Derivative liabilities (designated for hedging) | 57,221 | |||||||||||||||
Cash flow hedge | ||||||||||||||||||||
Interest rate risk | ||||||||||||||||||||
Interest rate swap | KRW 150,000 | - | 1,476 |
Derivative liabilities (designated for hedging) | (196 | ) | ||||||||||||||
Foreign currency translation risk and interest rate risk | ||||||||||||||||||||
Currency swap | USD 600,000,000 | - | 62,893 |
Derivative liabilities (designated for hedging) | (69,319 | ) | ||||||||||||||
Foreign currency translation risk | ||||||||||||||||||||
Currency swap | SGD 68,000,000 | - | 373 |
Derivative liabilities (designated for hedging) | (4,699 | ) |
- 102 -
(6) | Details of carrying amount to hedge and amount due to hedge accounting are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||||||||||||||||||||||
Carrying amounts of the hedged item |
Accumulated amount of fair value hedge adjustments on the hedged item included in the carrying amount of the hedged item |
Line item in the statement of financial position in which the hedged item is included |
Changing in fair value used for calculating hedge ineffectiveness |
Cash flow hedge reserve (*) | ||||||||||||||||||||||||
Assets | Liabilities | Assets | Liabilities | |||||||||||||||||||||||||
Fair value hedge | ||||||||||||||||||||||||||||
Interest rate risk | ||||||||||||||||||||||||||||
Debentures | - | 2,862,453 | - | 89,039 | Debentures | 55,352 | - | |||||||||||||||||||||
Foreign exchange rate risk | ||||||||||||||||||||||||||||
Equity securities in foreign currencies | 13,874 | - | 479 | - |
Equity securities in foreign currencies | 479 | - | |||||||||||||||||||||
Cash flow hedge | ||||||||||||||||||||||||||||
Interest rate risk | ||||||||||||||||||||||||||||
Debentures | - | 149,957 | - | - | Debentures | (1,236 | ) | (7 | ) | |||||||||||||||||||
Foreign currencies translation risk and interest rate risk | ||||||||||||||||||||||||||||
Debentures | - | 530,279 | - | - | Debentures | (24,395 | ) | 3,202 | ||||||||||||||||||||
Foreign currencies translation risk | ||||||||||||||||||||||||||||
Debentures | - | 112,327 | - | - | Debentures | 251 | 23 |
(*) | After tax amount |
December 31, 2020 | ||||||||||||||||||||||||||||
Carrying amounts of the hedged item |
Accumulated amount of fair value hedge adjustments on the hedged item included in the carrying amount of the hedged item |
Line item in the statement of financial position in which the hedged item is included |
Changing in fair value used for calculating hedge ineffectiveness |
Cash flow hedge reserve (*) | ||||||||||||||||||||||||
Assets | Liabilities | Assets | Liabilities | |||||||||||||||||||||||||
Fair value hedge | ||||||||||||||||||||||||||||
Interest rate risk | ||||||||||||||||||||||||||||
Debentures | - | 2,767,208 | - | 144,741 | Debentures | (59,073 | ) | - | ||||||||||||||||||||
Cash flow hedge | ||||||||||||||||||||||||||||
Interest rate risk | ||||||||||||||||||||||||||||
Debentures | - | 149,936 | - | - | Debentures | 188 | (909 | ) | ||||||||||||||||||||
Foreign currencies translation risk and interest rate risk | ||||||||||||||||||||||||||||
Debentures | - | 651,704 | - | - | Debentures | 61,823 | (95 | ) | ||||||||||||||||||||
Foreign currencies translation risk | ||||||||||||||||||||||||||||
Debentures | - | 55,891 | - | - | Debentures | 6,564 | (268 | ) |
(*) | After tax amount |
- 103 -
(7) | Amounts recognized in profit or loss due to the ineffective portion of fair value hedges are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||
Hedge ineffectiveness recognized in profit or loss |
Line item in the profit or loss that includes hedge ineffectiveness | |||||||||
Fair value hedge | Interest rate risk | 7,897 |
Other net operating income (expense) | |||||||
Foreign exchange rate risk | 479 |
Other net operating income (expense) |
For the six-month period ended June 30, 2020 | ||||||||||
Hedge ineffectiveness recognized in profit or loss |
Line item in the profit or loss that includes hedge ineffectiveness | |||||||||
Fair value hedge | Interest rate risk | 2,584 |
Other net operating income (expense) |
(8) | Reclassification of profit or loss from other comprehensive income and equity related to cash flow hedges are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||||
Changes in the value of hedging instruments recognized in OCI |
Hedge ineffectiveness recognized in profit or loss |
Changes in the value of foreign basis spread recognized in OCI |
Line item recognized in the profit or loss |
Amounts reclassified from cash flow hedge reserve to profit or loss |
Line item affected in profit or loss due to reclassification | |||||||||||||||||||
Cash flow hedge | Interest rate risk | 1,243 | 28 | - |
Other net operating income (expense) | - |
Other net operating income (expense) | |||||||||||||||||
Foreign currencies translation risk and interest rate risk | 30,957 | 169 | (1,628 | ) |
Other net operating income (expense) | (26,041 | ) |
Other net operating income (expense) | ||||||||||||||||
Foreign currencies translation risk | 617 | (258 | ) | (223 | ) |
Other net operating income (expense) | (95 | ) |
Other net operating income (expense) | |||||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||||||||||
Changes in the value of hedging instruments recognized in OCI |
Hedge ineffectiveness recognized in profit or loss |
Changes in the value of foreign basis spread recognized in OCI |
Line item recognized in the profit or loss |
Amounts reclassified from cash flow hedge reserve to profit or loss |
Line item affected in profit or loss due to reclassification | |||||||||||||||||||
Cash flow hedge | Interest rate risk | (1,133 | ) | (54 | ) | - |
Other net operating income (expense) | - |
Other net operating income (expense) | |||||||||||||||
Foreign currencies translation risk and interest rate risk | 1,581 | 673 | (1,812 | ) |
Other net operating income (expense) | (9,816 | ) |
Other net operating income (expense) | ||||||||||||||||
Foreign currencies translation risk | 1,172 | 306 | 7 |
Other net operating income (expense) | (651 | ) |
Other net operating income (expense) |
- 104 -
25. | DEFERRED DAY 1 PROFITS OR LOSSES |
Changes in deferred day 1 profits or losses are as follows (Unit: Korean Won in millions):
For the six-month period ended June 30 | ||||||||
2021 | 2020 | |||||||
Beginning balance | 6,939 | 52,260 | ||||||
New transactions | 37,040 | 26,267 | ||||||
Amounts recognized in losses | (12,564 | ) | (35,306 | ) | ||||
Ending balance | 31,415 | 43,221 | ||||||
In case some variables to measure fair values of financial instruments are not observable in the market, valuation techniques are utilized to evaluate such financial instruments. Those financial instruments are recorded the transaction price as at the time of acquisition, even though there are difference noted between the transaction price and the fair value, which is deferred and amortized to maturity using the effective interest method and reflected in profit and loss. The table above presents the difference yet to be realized as profit or loss at the end of June 30, 2021 and 2020.
26. | EQUITY |
(1) | Details of equity as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Capital | ||||||||
Common stock capital | 3,611,338 | 3,611,338 | ||||||
Hybrid securities | 2,094,818 | 1,895,366 | ||||||
Capital surplus | ||||||||
Paid in capital in excess of par | 608,348 | 608,348 | ||||||
Others | 23,020 | 17,763 | ||||||
Sub-total | 631,368 | 626,111 | ||||||
Capital adjustments | ||||||||
Treasury stock | - | - | ||||||
Other adjustments (*1) | (1,721,091 | ) | (1,775,312 | ) | ||||
Sub-total | (1,721,091 | ) | (1,775,312 | ) | ||||
Accumulated other comprehensive income | ||||||||
Financial assets at FVTOCI | 2,430 | (9,833 | ) | |||||
Changes in capital due to equity method | 64 | (2,609 | ) | |||||
Loss from foreign business translation | (213,724 | ) | (298,363 | ) | ||||
Remeasurements of defined benefit plan | (247,577 | ) | (261,195 | ) | ||||
Loss on evaluation of cash flow hedge | 2,503 | (1,386 | ) | |||||
Capital related to noncurrent assets held for sale | 666 | 1,226 | ||||||
Sub-total | (455,638 | ) | (572,160 | ) | ||||
Retained earnings (*2) (*3) | 20,398,356 | 19,268,265 | ||||||
Non-controlling interest (*4) | 3,601,023 | 3,672,237 | ||||||
Total | 28,160,174 | 26,725,845 | ||||||
(*1) | Included 178,060 million Won in capital transaction gains and losses recognized by Woori Bank and (formerly) Woori Financial Group in 2014 and 2,238,228 million Won due to the spin-off of Gyeongnam Bank and Gwangju Bank. |
(*2) | The regulatory reserve for credit losses in retained earnings amounted to 2,568,367 million Won and 2,547,547 million Won as of June 30, 2021 and December 31, 2020, respectively in accordance with the relevant article. |
(*3) | The earned surplus reserve in retained earnings amounted to 122,370 million Won and 62,830 million Won as of June 30, 2021 and December 31, 2020 in accordance with the Article 53 of the Financial Holding Company Act. |
(*4) | The hybrid securities issued by Woori Bank amounting to 3,105,070 million Won as of June 30, 2021 and December 31, 2020, respectively, are recognized as non-controlling interests. 71,537 million Won and 90,091 million Won of dividends for the hybrid securities issued by Woori Bank are allocated to net profit and loss of the non-controlling interests for the six-month period ended June 30, 2021 and 2020, respectively. |
- 105 -
(2) | The number of authorized shares and others of the Group are as follows: |
June 30, 2021 | December 31, 2020 | |||||||
Shares of common stock authorized | 4,000,000,000 Shares | 4,000,000,000 Shares | ||||||
Par value | 5,000 Won | 5,000 Won | ||||||
Shares of common stock issued | 722,267,683 Shares | 722,267,683 Shares | ||||||
Capital stock | 3,611,338 million Won | 3,611,338 million Won |
(3) | Hybrid securities |
The bond-type hybrid securities classified as owner's equity are as follows (Unit: Korean Won in millions):
Issue date | Maturity |
Interest rate (%) |
June 30, 2021 |
December 31, 2020 | ||||||||||||||
Securities in local currency | 2019-07-18 | - | 3.49 | 500,000 | 500,000 | |||||||||||||
Securities in local currency | 2019-10-11 | - | 3.32 | 500,000 | 500,000 | |||||||||||||
Securities in local currency | 2020-02-06 | - | 3.34 | 400,000 | 400,000 | |||||||||||||
Securities in local currency | 2020-06-12 | - | 3.23 | 300,000 | 300,000 | |||||||||||||
Securities in local currency | 2020-10-23 | - | 3.00 | 200,000 | 200,000 | |||||||||||||
Securities in local currency | 2021-04-08 | - | 3.15 | 200,000 | - | |||||||||||||
Issuance cost | (5,182 | ) | (4,634 | ) | ||||||||||||||
Total | 2,094,818 | 1,895,366 | ||||||||||||||||
The hybrid securities mentioned above do not have maturity date but are redeemable after 5 years from date of issuance.
(4) | Accumulated other comprehensive income |
Changes in the accumulated other comprehensive income are as follows (Unit: Korean Won in millions):
For the six-month period ended June 30, 2021 | ||||||||||||||||||||
Beginning balance |
Increase (decrease) (*) |
Reclassification adjustments |
Income tax effect (*) |
Ending balance | ||||||||||||||||
Net gain(loss) on valuation of financial assets at FVTOCI | (9,833 | ) | 63,949 | (45,059 | ) | (6,627 | ) | 2,430 | ||||||||||||
Changes in capital due to equity method | (2,609 | ) | 2,495 | - | 178 | 64 | ||||||||||||||
Gain(loss) on foreign currency translation of foreign operations | (298,363 | ) | 85,763 | - | (1,124 | ) | (213,724 | ) | ||||||||||||
Remeasurement gain(loss) related to defined benefit plan | (261,195 | ) | 18,782 | - | (5,164 | ) | (247,577 | ) | ||||||||||||
Gain(loss) on valuation of derivatives designated as cash flow hedges | (1,386 | ) | 3,084 | 896 | (91 | ) | 2,503 | |||||||||||||
Capital related to noncurrent assets held for sale | 1,226 | (772 | ) | - | 212 | 666 | ||||||||||||||
Total | (572,160 | ) | 173,301 | (44,163 | ) | (12,616 | ) | (455,638 | ) | |||||||||||
(*) | The increase and decrease of financial asset valuation profit or loss at fair value through other comprehensive income and capital related to noncurrent assets held for sale is a change due to the period evaluation and the reclassification adjustments amounting to 33,448 million Won, (797) million Won and 560 million Won are due to disposal of equity securities at FVTOCI, investment stocks accounted for using the equity method and assets held for sale during the period. |
- 106 -
For the six-month period ended June 30, 2020 | ||||||||||||||||||||
Beginning balance |
Increase (decrease) (*) |
Reclassification adjustments |
Income tax effect |
Ending balance | ||||||||||||||||
Net gain (loss) on valuation of financial assets at FVTOCI | (71,914 | ) | (20,412 | ) | (13,587 | ) | 8,880 | (97,033 | ) | |||||||||||
Changes in capital due to equity method | 915 | (6,374 | ) | - | 1,753 | (3,706 | ) | |||||||||||||
Gain(loss) on foreign currency translation of foreign operations | (152,987 | ) | 58,028 | - | (3,583 | ) | (98,542 | ) | ||||||||||||
Remeasurement gain(loss) related to defined benefit plan | (270,977 | ) | (36,194 | ) | - | 9,953 | (297,218 | ) | ||||||||||||
Gain(loss) on valuation of derivatives designated as cash flow hedges | (5,692 | ) | (11,032 | ) | - | 1,002 | (15,722 | ) | ||||||||||||
Total | (500,655 | ) | (15,984 | ) | (13,587 | ) | 18,005 | (512,221 | ) | |||||||||||
(*) | The increase and decrease of financial asset valuation profit or loss at fair value through other comprehensive income is a change due to the period evaluation and the reclassification adjustments amounting to 578 million Won are due to disposal of equity securities during the period. |
(5) | Regulatory Reserve for Credit Loss |
In accordance with Article 26 ~ 28 of the Financial holding company Supervision Regulations, the Group calculates and discloses the regulatory reserve for credit loss.
1) | Balance of the regulatory reserve for credit loss |
Balance of the planned regulatory reserve for credit loss is as follows (Unit: Korean Won in millions):
June 30, 2021 |
December 31, 2020 | |||||||
Beginning balance | 2,568,367 | 2,547,547 | ||||||
Planned provision(reversal) of regulatory reserve for credit loss | 163,847 | 20,820 | ||||||
Ending balance | 2,732,214 | 2,568,367 | ||||||
2) | Provision of regulatory reserve for credit loss, adjusted income after the provision of regulatory reserve and others |
Planned reserves provided, adjusted net income after the planned reserves provided and adjusted EPS after the planned reserves provided are as follows (Unit: Korean Won in millions, except for EPS amount):
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Net income before regulatory reserve | 818,384 | 1,537,251 | 216,262 | 774,033 | ||||||||||||
Provision(reversal) of regulatory reserve for credit loss | 80,767 | 163,847 | (80,155 | ) | (12,236 | ) | ||||||||||
Adjusted net income after the provision of regulatory reserve | 737,617 | 1,373,404 | 296,417 | 786,269 | ||||||||||||
Dividends to hybrid securities | (15,775 | ) | (31,550 | ) | (11,852 | ) | (20,365 | ) | ||||||||
Adjusted net income after regulatory reserve and dividends to hybrid securities | 721,842 | 1,341,854 | 284,565 | 765,904 | ||||||||||||
Adjusted EPS after regulatory reserve and the dividends to hybrid securities (Unit: Korean Won) | 1,000 | 1,858 | 394 | 1,061 |
- 107 -
27. | DIVIDENDS |
(1) | Dividends per share and the total dividends for the fiscal year ending December 31, 2020 were 360 Won and 260,016 million Won, respectively, and the dividends were approved at the regular general shareholders' meeting held on March 26, 2021, and were paid in April, 2021. |
(2) | On July 23, 2021, the Group declared the interim dividend of 150 Won per share (total dividend of 108,340 million Won) with July 30, 2021 as the record date, in accordance with a resolution of the Board of Directors. |
28. | NET INTEREST INCOME |
(1) | Interest income recognized is as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Financial assets at FVTPL | 11,046 | 22,420 | 13,681 | 26,210 | ||||||||||||
Financial assets at FVTOCI | 83,821 | 175,607 | 114,823 | 241,000 | ||||||||||||
Financial assets at amortized cost | ||||||||||||||||
Securities at amortized cost | 79,129 | 161,372 | 98,001 | 202,060 | ||||||||||||
Loans and other financial assets at amortized cost | ||||||||||||||||
Interest on due from banks | 10,484 | 19,938 | 9,866 | 32,735 | ||||||||||||
Interest on loans | 2,191,158 | 4,315,503 | 2,168,347 | 4,398,249 | ||||||||||||
Interest of other receivables | 7,648 | 15,631 | 7,471 | 15,749 | ||||||||||||
Subtotal | 2,209,290 | 4,351,072 | 2,185,684 | 4,446,733 | ||||||||||||
Total | 2,383,286 | 4,710,471 | 2,412,189 | 4,916,003 | ||||||||||||
(2) | Details of interest expense recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Interest on deposits due to customers | 444,895 | 912,346 | 664,329 | 1,413,501 | ||||||||||||
Interest on borrowings | 47,311 | 95,865 | 80,915 | 165,586 | ||||||||||||
Interest on debentures | 177,528 | 359,156 | 178,699 | 367,192 | ||||||||||||
Other interest expense | 8,788 | 16,713 | 8,232 | 23,593 | ||||||||||||
Interest on lease liabilities | 1,811 | 3,772 | 2,124 | 5,282 | ||||||||||||
Total | 680,333 | 1,387,852 | 934,299 | 1,975,154 | ||||||||||||
- 108 -
29. | NET FEES AND COMMISSIONS INCOME |
(1) | Details of fees and commissions income recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Fees and commission received for brokerage | 48,867 | 95,991 | 40,910 | 81,136 | ||||||||||||
Fees and commission received related to credit | 57,328 | 106,809 | 43,976 | 96,904 | ||||||||||||
Fees and commission received for electronic finance | 34,739 | 66,696 | 30,081 | 61,764 | ||||||||||||
Fees and commission received on foreign exchange handling | 14,275 | 27,539 | 13,407 | 27,798 | ||||||||||||
Fees and commission received on foreign exchange | 18,356 | 31,939 | 15,359 | 32,034 | ||||||||||||
Fees and commission received for guarantee | 18,535 | 36,072 | 18,940 | 37,068 | ||||||||||||
Fees and commission received on credit card | 141,129 | 278,523 | 125,980 | 249,267 | ||||||||||||
Fees and commission received on securities business | 33,684 | 57,745 | 22,465 | 38,896 | ||||||||||||
Fees and commission from trust management | 51,231 | 98,435 | 35,929 | 86,292 | ||||||||||||
Fees and commission received on credit information | 2,676 | 5,099 | 3,791 | 7,194 | ||||||||||||
Fees and commission received related to lease | 86,442 | 168,634 | - | - | ||||||||||||
Other fees | 39,789 | 92,434 | 46,444 | 89,640 | ||||||||||||
Total | 547,051 | 1,065,916 | 397,282 | 807,993 | ||||||||||||
(2) | Details of fees and commissions expense incurred are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Fees and commissions paid | 67,143 | 126,989 | 52,045 | 93,405 | ||||||||||||
Credit card commission | 105,766 | 203,516 | 118,647 | 211,784 | ||||||||||||
Brokerage commission | 317 | 556 | 156 | 217 | ||||||||||||
Others | 2,832 | 5,401 | 2,065 | 4,238 | ||||||||||||
Total | 176,058 | 336,462 | 172,913 | 309,644 | ||||||||||||
30. | DIVIDEND INCOME |
(1) | Details of dividend income recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Dividend income related to financial assets at FVTPL | 61,125 | 114,442 | 21,576 | 54,382 | ||||||||||||
Dividend income related to financial assets at FVTOCI | 3,023 | 16,296 | 1,657 | 16,620 | ||||||||||||
Total | 64,148 | 130,738 | 23,233 | 71,002 | ||||||||||||
(2) | Details of dividends related to financial assets at FVTOCI are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Dividend income recognized from assets held | ||||||||||||||||
Equity securities | 3,023 | 16,296 | 1,657 | 16,620 |
- 109 -
31. | NET GAIN OR LOSS ON FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS MANDATORILY MEASURED AT FAIR VALUE |
(1) | Details of gains or losses related to net gain or loss on financial instruments at FVTPL are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Gain(loss) on financial instruments at FVTPL measured at fair value | 55,184 | 136,305 | (64,135 | ) | 393,168 | |||||||||||
Gain(loss) on financial instruments at FVTPL designated as upon initial recognition | (860 | ) | 102 | (2,351 | ) | 8,421 | ||||||||||
Total | 54,324 | 136,407 | (66,486 | ) | 401,589 | |||||||||||
(2) | Details of net gain or loss on financial instruments at fair value through profit or loss measured at fair value and financial instruments held for trading are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||||||
Financial | Securities | Gain on transactions and valuation | 66,625 | 145,444 | 48,576 | 97,202 | ||||||||||||||
Loss on transactions and valuation | (47,607 | ) | (99,481 | ) | (2,851 | ) | (71,218 | ) | ||||||||||||
Sub-total | 19,018 | 45,963 | 45,725 | 25,984 | ||||||||||||||||
Loans | Gain on transactions and valuation | 8,592 | 14,089 | 1,660 | 1,730 | |||||||||||||||
Loss on transactions and valuation | (2,686 | ) | (4,081 | ) | (100 | ) | (862 | ) | ||||||||||||
Sub-total | 5,906 | 10,008 | 1,560 | 868 | ||||||||||||||||
Other financial assets | Gain on transactions and valuation | 2,520 | 7,819 | 1,638 | 4,505 | |||||||||||||||
Loss on transactions and valuation | (1,858 | ) | (5,412 | ) | (1,508 | ) | (4,195 | ) | ||||||||||||
Sub-total | 662 | 2,407 | 130 | 310 | ||||||||||||||||
Sub-total | 25,586 | 58,378 | 47,415 | 27,162 | ||||||||||||||||
Derivatives | Interest rates derivatives | Gain on transactions and valuation | 391,344 | 845,923 | 356,000 | 986,560 | ||||||||||||||
Loss on transactions and valuation | (370,337 | ) | (745,974 | ) | (375,781 | ) | (1,320,559 | ) | ||||||||||||
Sub-total | 21,007 | 99,949 | (19,781 | ) | (333,999 | ) | ||||||||||||||
Currency derivatives | Gain on transactions and valuation | 398,232 | 4,532,105 | 45,273 | 6,200,908 | |||||||||||||||
Loss on transactions and valuation | (395,527 | ) | (4,567,000 | ) | (110,208 | ) | (5,497,798 | ) | ||||||||||||
Sub-total | 2,705 | (34,895 | ) | (64,935 | ) | 703,110 | ||||||||||||||
Equity derivatives | Gain on transactions and valuation | 255,081 | 1,064,630 | (41,433 | ) | 1,107,537 | ||||||||||||||
Loss on transactions and valuation | (249,095 | ) | (1,050,952 | ) | 14,755 | (1,110,279 | ) | |||||||||||||
Sub-total | 5,986 | 13,678 | (26,678 | ) | (2,742 | ) | ||||||||||||||
Other derivatives | Gain on transactions and valuation | - | - | - | - | |||||||||||||||
Loss on transactions and valuation | (100 | ) | (805 | ) | (156 | ) | (363 | ) | ||||||||||||
Sub-total | (100 | ) | (805 | ) | (156 | ) | (363 | ) | ||||||||||||
Sub-total | 29,598 | 77,927 | (111,550 | ) | 366,006 | |||||||||||||||
Net, total | 55,184 | 136,305 | (64,135 | ) | 393,168 | |||||||||||||||
- 110 -
(3) | Details of net gain(loss) on financial instruments at fair value through profit or loss designated as upon initial recognition and Losses on financial instruments designated as at fair value through profit or loss are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Gain(loss) on equity-linked securities | (860 | ) | 102 | (2,351 | ) | 8,421 |
32. | NET GAIN OR LOSS ON FINANCIAL ASSETS AT FVTOCI |
Details of net gain or loss on financial assets at FVTOCI recognized are as follows (Unit: Korean Won in millions):
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Gain on redemption of securities | (11 | ) | (10 | ) | (35 | ) | (74 | ) | ||||||||
Gain on transactions of securities | 8,059 | 45,069 | 8,462 | 11,101 | ||||||||||||
Total | 8,048 | 45,059 | 8,427 | 11,027 | ||||||||||||
33. | REVERSAL OF(PROVISION FOR) IMPAIRMENT LOSSES DUE TO CREDIT LOSS |
Reversal of (provision for) impairment losses due to credit loss are as follows (Unit: Korean Won in millions):
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Impairment loss due to credit loss on financial assets measured at FVTOCI | (1,079 | ) | (2,097 | ) | (770 | ) | (782 | ) | ||||||||
Reversal of(provision for) impairment loss due to credit loss on securities at amortized cost | 106 | 293 | (190 | ) | (47 | ) | ||||||||||
Provision for impairment loss due to credit loss on loan and other financial assets at amortized cost | (83,507 | ) | (220,715 | ) | (319,532 | ) | (422,066 | ) | ||||||||
Reversal of(provision for) provision on guarantee | 8,454 | 7,597 | 2,435 | (3,972 | ) | |||||||||||
Reversal of(provision for) unused loan commitment | 7,443 | 10,346 | (17,730 | ) | (19,812 | ) | ||||||||||
Total | (68,583 | ) | (204,576 | ) | (335,787 | ) | (446,679 | ) | ||||||||
- 111 -
34. | GENERAL AND ADMINISTRATIVE EXPENSES AND OTHER NET OPERATING INCOME(EXPENSES) |
(1) | Details of general and administrative expenses recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||||||
Employee benefits | Short-term employee benefits | Salaries | 390,030 | 794,269 | 374,978 | 770,314 | ||||||||||||||
Employee fringe benefits | 139,143 | 269,252 | 126,905 | 248,461 | ||||||||||||||||
Share based payment | 5,505 | 7,858 | 2,745 | 2,316 | ||||||||||||||||
Retirement benefit service costs | 45,369 | 91,002 | 43,860 | 88,207 | ||||||||||||||||
Termination | 274 | 555 | 558 | 221 | ||||||||||||||||
Subtotal | 580,321 | 1,162,936 | 549,046 | 1,109,519 | ||||||||||||||||
Depreciation and amortization | 129,080 | 264,505 | 124,289 | 258,964 | ||||||||||||||||
Other general and administrative expenses | Rent | 21,430 | 40,736 | 20,246 | 35,172 | |||||||||||||||
Taxes and public dues | 41,373 | 78,529 | 40,080 | 74,268 | ||||||||||||||||
Service charges | 60,657 | 113,715 | 59,737 | 116,624 | ||||||||||||||||
Computer and IT related | 28,724 | 55,234 | 26,416 | 52,839 | ||||||||||||||||
Telephone and communication | 19,475 | 37,612 | 18,266 | 35,091 | ||||||||||||||||
Operating promotion | 9,756 | 18,959 | 9,696 | 20,718 | ||||||||||||||||
Advertising | 18,786 | 28,351 | 19,060 | 28,412 | ||||||||||||||||
Printing | 1,370 | 3,020 | 1,481 | 3,376 | ||||||||||||||||
Traveling | 1,665 | 3,369 | 1,521 | 3,698 | ||||||||||||||||
Supplies | 1,704 | 3,412 | 3,670 | 6,907 | ||||||||||||||||
Insurance premium | 2,486 | 5,040 | 2,746 | 5,551 | ||||||||||||||||
Reimbursement | 1,815 | 1,289 | 4,185 | 4,855 | ||||||||||||||||
Maintenance | 4,873 | 9,778 | 4,088 | 7,994 | ||||||||||||||||
Water, light, and heating | 2,969 | 7,327 | 3,188 | 7,640 | ||||||||||||||||
Vehicle maintenance | 2,856 | 5,202 | 2,346 | 4,821 | ||||||||||||||||
Others | 8,546 | 16,479 | 6,971 | 13,109 | ||||||||||||||||
Sub-total | 228,485 | 428,052 | 223,697 | 421,075 | ||||||||||||||||
Total | 937,886 | 1,855,493 | 897,032 | 1,789,558 | ||||||||||||||||
(2) | Details of other operating income recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Gain on transactions of foreign exchange | 210,908 | 332,740 | 191,767 | 269,151 | ||||||||||||
Gain related to derivatives | 478 | 26,477 | (7,637 | ) | 132,356 | |||||||||||
Gain on fair value hedged items | 2,609 | 61,262 | - | - | ||||||||||||
Others | 27,874 | 52,215 | 23,948 | 32,754 | ||||||||||||
Total | 241,869 | 472,694 | 208,078 | 434,261 | ||||||||||||
(3) | Details of other operating expenses recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Losses on transactions of foreign exchange | 101,259 | 217,299 | 47,544 | 464,540 | ||||||||||||
KDIC deposit insurance premium | 100,673 | 198,218 | 91,319 | 180,530 | ||||||||||||
Contribution to miscellaneous funds | 90,455 | 176,601 | 78,335 | 156,969 | ||||||||||||
Losses related to derivatives (Designated for hedging) | 2,970 | 53,359 | 8,950 | 9,324 | ||||||||||||
Losses on fair value hedged items | - | - | 2,322 | 108,090 | ||||||||||||
Others (*) | 94,185 | 186,265 | 20,877 | 61,451 | ||||||||||||
Total | 389,542 | 831,742 | 249,347 | 980,904 | ||||||||||||
(*) | Other expense includes such expenses amounting to 6,808 million Won and 6,786 million Won, respectively, of intangible asset amortization expense for the six-month periods ended June 30, 2021 and 2020, respectively. |
- 112 -
(4) | Share-based payment |
Details of performance condition share-based payment granted to executives as of June 30, 2021 and December 31, 2020 are as follows.
1) | Performance condition share-based payment |
Subject to | Shares granted for the year 2019 | |||
Type of payment | Cash-settled | |||
Vesting period | January 1, 2019 ~ December 31, 2022 | |||
Date of payment | 2023-01-01 | |||
Fair value (*1) | 10,808 Won | |||
Valuation method | Black-Scholes Model | |||
Expected dividend rate | 4.28% | |||
Expected maturity date | 1.5 years | |||
Number of shares remaining | As of June 30, 2021 | 602,474 shares | ||
As of December 31, 2020 | 602,474 shares | |||
Number of shares granted (*2) | As of June 30, 2021 | 602,474 shares | ||
As of December 31, 2020 | 602,474 shares | |||
Subject to | Shares granted for the year 2020 | |||
Type of payment | Cash-settled | |||
Vesting period | January 1, 2020 ~ December 31, 2023 | |||
Date of payment | 2024-01-01 | |||
Fair value (*1) | 10,356 Won | |||
Valuation method | Black-Scholes Model | |||
Expected dividend rate | 4.28% | |||
Expected maturity date | 2.5 years | |||
Number of shares remaining | As of June 30, 2021 | 944,343 shares | ||
As of December 31, 2020 | 944,343 shares | |||
Number of shares granted (*2) | As of June 30, 2021 | 944,343 shares | ||
As of December 31, 2020 | 944,343 shares | |||
Subject to | Shares granted for the year 2021 | |||
Type of payment | Cash-settled | |||
Vesting period | January 1, 2021 ~ December 31, 2024 | |||
Date of payment | 2025-01-01 | |||
Fair value (*1) | 9,922 Won | |||
Valuation method | Black-Scholes Model | |||
Expected dividend rate | 4.28% | |||
Expected maturity date | 3.5 years | |||
Number of shares remaining | As of June 30, 2021 | 543,176 shares | ||
As of December 31, 2020 | - | |||
Number of shares granted (*2) | As of June 30, 2021 | 543,176 shares | ||
As of December 31, 2020 | - |
(*1) | As the amount of payment varies according to the base price (the arithmetic average of the weighted average stock price of transactions in the past one week, the past one month, and the past two months) at the date of payment, the fair value is calculated to measure the liability according to the Black Scholes model based on the base price at the time of each settlement. |
(*2) | It is a system in which the amount of stock payable is determined at the beginning, and the payment rate is determined in accordance with the degree of achievement of the pre-set performance target. Performance is evaluated by long-term performance indicators such as relative shareholder return, net profit, return on equity (ROE), non-performing loan ratio, and job performance. |
- 113 -
2) | The Group accounts for performance condition share-based payments according to the cash-settled method and the fair value of the liabilities is reflected in the compensation costs by re-measuring every closing period. As of June 30, 2021 and December 31, 2020, the book value of the liabilities related to the performance condition share-based payments recognized by the Group amounts to 21,681 million Won and 13,823 million Won, respectively. |
35. | NON-OPERATING INCOME(EXPENSES) |
(1) | Details of gains or losses on valuation of investments in joint ventures and associates are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Gains on valuation of investments in joint ventures and associates | 32,617 | 38,702 | 20,620 | 35,683 | ||||||||||||
Losses on valuation of investments in joint ventures and associates | (794 | ) | (11,671 | ) | (3,822 | ) | (11,731 | ) | ||||||||
Impairment losses of investments in joint ventures and associates | 9 | (790 | ) | - | - | |||||||||||
Total | 31,832 | 26,241 | 16,798 | 23,952 | ||||||||||||
(2) | Details of other non-operating income and expenses recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Other non-operating incomes | 41,503 | 66,330 | 17,890 | 37,114 | ||||||||||||
Other non-operating expenses | (47,677 | ) | (58,663 | ) | (152,712 | ) | (199,815 | ) | ||||||||
Total | (6,174 | ) | 7,667 | (134,822 | ) | (162,701 | ) | |||||||||
(3) | Details of other non-operating income recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Rental fee income | 5,501 | 9,164 | 3,996 | 7,577 | ||||||||||||
Gains on disposal of premises and equipment, intangible assets and other assets | 28,886 | 33,345 | 126 | 6,575 | ||||||||||||
Reversal of impairment loss of premises and equipment, intangible assets and other assets | (48 | ) | 96 | 20 | 55 | |||||||||||
Others | 7,164 | 23,725 | 13,748 | 22,907 | ||||||||||||
Total | 41,503 | 66,330 | 17,890 | 37,114 | ||||||||||||
(4) | Details of other non-operating expenses recognized are as follows (Unit: Korean Won in millions): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Depreciation on investment properties | 837 | 1,411 | 540 | 1,087 | ||||||||||||
Operating expenses on investment properties | 383 | 567 | 158 | 382 | ||||||||||||
Losses on disposal of premises and equipment, intangible assets and other assets | 1,178 | 1,798 | 491 | 821 | ||||||||||||
Impairment losses of premises and equipment, intangible assets and other assets | 418 | 639 | 7,687 | 8,254 | ||||||||||||
Donation | 19,456 | 22,043 | 6,767 | 11,305 | ||||||||||||
Others | 25,405 | 32,205 | 137,069 | 177,966 | ||||||||||||
Total | 47,677 | 58,663 | 152,712 | 199,815 | ||||||||||||
- 114 -
36. | INCOME TAX EXPENSE |
Details of income tax expenses are as follows (Unit: Korean Won in millions):
For the six-month periods ended June 30 | ||||||||
2021 | 2020 | |||||||
Current tax expense | ||||||||
Current tax expense with respect to the current period | 399,935 | 180,059 | ||||||
Adjustments recognized in the current period in relation to the tax expense of prior periods | (18,331 | ) | (4,292 | ) | ||||
Sub-total | 381,604 | 175,767 | ||||||
Deferred tax expense | ||||||||
Change in deferred tax assets(liabilities) due to temporary differences | 111,509 | 66,044 | ||||||
Income tax expense directly attributable to equity | (12,616 | ) | 18,005 | |||||
Sub-total | 98,893 | 84,049 | ||||||
Income tax expense | 480,497 | 259,816 | ||||||
Income tax expense was recognized based on the estimate of the best weighted average annual effective tax rate expected for the interim period. The weighted average annual effective tax rate for the June 30, 2021, is 23.8% (The weighted average annual effective tax rate for the June 30, 2020, is 25.1%).
- 115 -
37. | EARNINGS PER SHARE ('EPS') |
(1) | Basic EPS is calculated by dividing net income attributable to common shareholders by weighted-average number of common shares outstanding (Unit: Korean Won in millions, except for EPS and number of shares): |
Periods ended June 30, 2021 | Periods ended June 30, 2020 | |||||||||||||||
Three-month | Six-month | Three-month | Six-month | |||||||||||||
Net income attributable to common shareholders | 752,595 | 1,419,698 | 142,348 | 660,564 | ||||||||||||
Dividends to hybrid securities | (15,775 | ) | (31,550 | ) | (11,852 | ) | (20,365 | ) | ||||||||
Net income attributable to common shareholders | 736,820 | 1,388,148 | 130,496 | 640,199 | ||||||||||||
Weighted average number of common shares outstanding (Unit: million shares) | 722 | 722 | 722 | 722 | ||||||||||||
Basic EPS (Unit: Korean Won) | 1,020 | 1,922 | 181 | 887 |
(2) | The weighted average number of common shares outstanding is as follows (Unit: number of shares, days) |
For the six-month period ended June 30, 2021 | ||||||||||||||||
Period |
Number of shares |
Dates (Unit: Day) |
Accumulated number of shares outstanding during period | |||||||||||||
Common shares issued at the beginning of the period | 2021-01-01 ~ 2021-06-30 | 722,267,683 | 181 | 130,730,450,623 | ||||||||||||
Treasury stock | 2021-01-01 ~ 2021-06-30 | (2 | ) | 181 | (362 | ) | ||||||||||
Sub-total (①) | 130,730,450,261 | |||||||||||||||
Weighted average number of common shares outstanding (②=(①/181) | 722,267,681 | |||||||||||||||
For the six-month period ended June 30, 2020 | ||||||||||||||||
Period |
Number of shares | Dates |
Accumulated number of shares outstanding during period | |||||||||||||
Common shares issued at the beginning of the period | 2020-01-01 ~ 2020-06-30 | 722,267,683 | 182 | 131,452,718,306 | ||||||||||||
Treasury stock | 2020-01-01 ~ 2020-06-30 | (2 | ) | 182 | (364 | ) | ||||||||||
Sub-total (①) | 131,452,717,942 | |||||||||||||||
Weighted average number of common shares outstanding (②=(①/182) | 722,267,681 | |||||||||||||||
Diluted EPS is equal to basic EPS because there is no dilution effect for the six-month periods ended June 30, 2021 and 2020.
- 116 -
38. | CONTINGENT LIABILITIES AND COMMITMENTS |
(1) | Details of guarantees are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Confirmed guarantees | ||||||||
Guarantee for loans | 37,749 | 103,229 | ||||||
Acceptances | 557,743 | 602,014 | ||||||
Guarantees in acceptances of imported goods | 97,178 | 78,395 | ||||||
Other confirmed guarantees | 6,885,062 | 6,491,608 | ||||||
Sub-total | 7,577,732 | 7,275,246 | ||||||
Unconfirmed guarantees | ||||||||
Local letters of credit | 238,209 | 187,146 | ||||||
Letters of credit | 3,074,284 | 3,025,923 | ||||||
Other unconfirmed guarantees | 582,906 | 403,652 | ||||||
Sub-total | 3,895,399 | 3,616,721 | ||||||
Commercial paper purchase commitments and others | 881,619 | 917,489 | ||||||
Total | 12,354,750 | 11,809,456 | ||||||
(2) | Details of unused loan commitments and others are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Loan commitments | 114,270,804 | 112,088,680 | ||||||
Other commitments (*) | 7,041,920 | 7,827,774 |
(*) | As of June 30, 2021 and December 31, 2020, the amount of unsecured bills (purchase note sales) and discounts on electronic short-term bond sales (purchase) are 3,252,994 million Won and 2,894,688 million Won, respectively. |
(3) | Litigation case |
Legal cases where the Group is involved are as follows (Unit: Korean Won in millions):
June 30, 2021 | December 31, 2020 | |||||||||||||||
As plaintiff | As defendant | As plaintiff | As defendant | |||||||||||||
Number of cases (*) | 165 cases | 478 cases | 138 cases | 460 cases | ||||||||||||
Amount of litigation | 314,746 | 371,526 | 413,852 | 413,744 | ||||||||||||
Provisions for litigations | 22,260 | 24,873 |
(*) | The number of lawsuits as of June 30, 2021 and December 31, 2020 do not include fraud lawsuits, etc. and those lawsuits that are filed only to extend the statute of limitation. |
- 117 -
(4) | Other commitments |
1) | The Group decided to enter into a stock sales agreement with a major shareholder of Woori Asset Trust Co., Ltd. (formerly, Kukje Asset Trust Co., Ltd.) to acquire 44.5% of interest (58.6% of voting rights) in July 2019, and to acquire additional 21.3% of interest (28.0% of voting rights) after a certain period. As a result, the Group acquired the interest of the first sales agreement in December 2019 and is planning to acquire the interest of the second sales agreement after a certain period. In regard to this acquisition, the Group recognized 128,021 million Won as other financial liabilities for the second sales agreement. |
2) | Lime Asset Management Co., Ltd. announced the suspension of redemption of many funds in operation in October 2019. The Group's total amount of sales of fund under management of Lime Asset Management Co., Ltd.'s subject to redemption suspension is 1,348 accounts and 263.8 billion Won at the end of June 2021. In December 2020, Lime Asset Management Co., Ltd.'s business registration was revoked, and funds subject to redemption suspension were transferred to Wellbridge Asset Management Co., Ltd., which was jointly established by distributors. The Financial Supervisory Service Dispute Mediation Committee was held on 23 February 2021 to discuss the incomplete sales of vendors. The consolidated company held a board meeting on March 15, 2021 to accept the decision of the Dispute Mediation Committee and resolve to expand the application of autonomous mediation, and is currently in the process of confirming the validity and compensation. |
3) | As of June 30, 2021, Woori Asset Trust Co., Ltd., a subsidiary, has agreed to carry out construction completion obligations for 72 constructions, which includes the construction of residential and commercial complexes in Busan (U-dong,Haeundae-gu). Land Trust responsible for Construction and Management is a trust that bears the obligation to fulfill the responsibility of the constructor and to compensate the loan financial institution for damages if the Group fails to fulfill the construction completion obligation. As of June 30, 2021, the total PF loan amount of PF loan institutions invested in the project of the Land Trust responsible for Construction and Management is 2,019,384 million Won. Although additional losses may occur in relation to the construction completion obligations, the financial statements at June 30, 2021 do not reflect these effects since losses are unlikely and the amount cannot be estimated reliably. |
4) | Pursuant to some contracts related to asset securitization, the Group utilizes various prerequisites as triggering events causing early redemption, limiting risks that investors bear due to change in asset quality. Breach of such triggering clause leads to an early redemption of the securitized bonds. |
- 118 -
39. | RELATED PARTY TRANSACTIONS |
Related parties of the Group as of June 30, 2021 and December 31, 2020, and assets and liabilities recognized, guarantees and commitments, major transactions with related parties and compensation to key management for the six-month periods ended June 30, 2021 and 2020 are as follows. Please see Note 12 for the details of joint ventures and associates.
(1) | Assets and liabilities from transactions with related parties are as follows (Unit: Korean Won in millions): |
Related parties | Account title |
June 30, 2021 |
December 31, 2020 | |||||||||
Associates | W Service Networks Co., Ltd. | Loans | 14 | 21 | ||||||||
Deposits due to customers | 2,498 | 2,183 | ||||||||||
Accrued expenses | 6 | 6 | ||||||||||
Other liabilities | 429 | 459 | ||||||||||
Korea Credit Bureau Co., Ltd. | Loans | 1 | 1 | |||||||||
Deposits due to customers | 911 | 2,311 | ||||||||||
Other liabilities | - | 5 | ||||||||||
Korea Finance Security Co., Ltd. | Loans | 3,423 | 3,440 | |||||||||
Loss allowance | (6 | ) | (6 | ) | ||||||||
Deposits due to customers | 3,952 | 1,927 | ||||||||||
Other liabilities | 1 | 1 | ||||||||||
Chin Hung International Inc. | Loans | - | 257 | |||||||||
Loss allowance | - | (3 | ) | |||||||||
Deposits due to customers | - | 8,715 | ||||||||||
Other liabilities | - | 171 | ||||||||||
LOTTE CARD Co. Ltd. | Loans | 5,625 | 7,500 | |||||||||
Loss allowance | (57 | ) | (77 | ) | ||||||||
Other assets | 7 | 12 | ||||||||||
Deposits due to customers | 12,120 | 2,697 | ||||||||||
Other liabilities | 113 | 113 | ||||||||||
K BANK Co., Ltd. | Loans | 62 | 104 | |||||||||
Account receivables | 67 | 26 | ||||||||||
Other assets | - | 2 | ||||||||||
Well to Sea No.3 Private Equity Fund | Deposits due to customers | - | 4,997 | |||||||||
Others (*1) (*2) | Loans | 42,694 | 44,036 | |||||||||
Loss allowance | (122 | ) | (126 | ) | ||||||||
Other assets | 580 | 651 | ||||||||||
Deposits due to customers | 5,743 | 5,831 | ||||||||||
Other liabilities | - | 5 |
(*1) | Others include KUM HWA Co., Ltd., Aarden Woori Apparel 1st Private Equity Fund, IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, Woori G IPO10 [FI_Bal][F]C(F), Woori G Star Private Placement Investment Trust No.33 [FI], Woori G Senior Loan No.1, Woori G Clean Energy No.1, Dongwoo C & C Co., Ltd., Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori-Q Corporate Restructuring Private Equity Fund, Woori High plus G.B. Securities Feeder Fund1(G.B.), Uri Hanhwa Eureka Private Equity Fund, Japanese Hotel Real Estate Private Equity Fund 2, Cultizm Korea LTD Co., Ltd., Partner One Value Up I Private Equity Fund, Force TEC Co., Ltd., Godo Kaisha Oceanos 1 and etc., as of June 30, 2021. |
(*2) | Others include Smart Private Equity Fund No.2, IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, Woori G IPO10 [FI_Bal][F]C(F), Woori G Senior Loan No.1, Woori G Egis Bond[FI][F](C(F)), Woori G Clean Energy No.1, Woori Star50 Feeder Fund(H), Dongwoo C & C Co., Ltd., Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori-Q Corporate Restructuring Private Equity Fund, Woori High plus G.B. Securities Feeder Fund1(G.B.), Uri Hanhwa Eureka Private Equity Fund, Japanese Hotel Real Estate Private Equity Fund 2, Partner One Value Up I Private Equity Fund, Godo Kaisha Oceanos 1 and etc., as of December 31, 2020. |
- 119 -
(2) | Gain or loss from transactions with related parties are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||||||
Related parties | Account title | 2021 | 2020 | |||||||||
Associates | W Service Network Co., Ltd. | Other income | 17 | 16 | ||||||||
Interest expenses | 3 | 9 | ||||||||||
Fees expenses | 349 | 226 | ||||||||||
Reversal of allowance for credit loss | - | (4 | ) | |||||||||
Other expenses | 921 | 1,001 | ||||||||||
Korea Credit Bureau Co., Ltd. | Interest expenses | 4 | 1 | |||||||||
Fees expenses | 1,746 | 1,544 | ||||||||||
Korea Finance Security Co., Ltd. | Interest income | 38 | - | |||||||||
Interest expenses | 1 | 2 | ||||||||||
Provision for allowance for credit loss | - | 6 | ||||||||||
Other expenses | 46 | 51 | ||||||||||
Chin Hung International Inc | Interest expenses | - | 11 | |||||||||
Provision for allowance for credit loss | - | 90 | ||||||||||
LOTTE CARD Co., Ltd. | Interest income | 159 | 150 | |||||||||
Fees income | 4,874 | 1,330 | ||||||||||
Interest expenses | 112 | 53 | ||||||||||
Reversal of allowance for credit loss | (19 | ) | - | |||||||||
K BANK Co., Ltd. | Fees income | 1,025 | 851 | |||||||||
Fees expenses | 16 | - | ||||||||||
Well to Sea No.3 Private Equity Fund | Interest income | - | 1,328 | |||||||||
Interest expenses | - | 2 | ||||||||||
Provision for allowance for credit loss | - | 77 | ||||||||||
Others (*1) (*2) | Interest income | 213 | 233 | |||||||||
Fees income | 1,483 | 1,261 | ||||||||||
Other income | - | 8 | ||||||||||
Interest expenses | 5 | 15 | ||||||||||
Provision for (reversal of) allowance for credit loss | (4 | ) | 42 |
(*1) | Others include Aarden Woori Apparel 1st Private Equity Fund, IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, AJU TAERIM 1st Fund, Woori G IPO10 [FI_Bal][F]C(F), Woori G Star Private Placement Investment Trust No.33 [FI], Woori G Senior Loan No.1, Woori G Clean Energy No.1, Woori Star50 Feeder Fund(H), Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori-Q Corporate Restructuring Private Equity Fund, Woori High plus G.B. Securities Feeder Fund1(G.B.), Uri Hanhwa Eureka Private Equity Fund, Japanese Hotel Real Estate Private Equity Fund 2, Partner One Value Up I Private Equity Fund, PCC-Woori LP Secondary Fund, Godo Kaisha Oceanos 1 and etc., as of June 30, 2021. |
(*2) | Others include Smart Private Equity Fund No.2, IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, AJU TAERIM 1st Fund, Woori G IPO10 [FI_Bal][F]C(F),Woori G Senior Loan No.1, Woori G Egis Bond[FI][F](C(F)), Woori G Clean Energy No.1, Woori Star50 Feeder Fund(H), Saman Corporation, Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori-Q Corporate Restructuring Private Equity Fund, Woori High plus G.B. Securities Feeder Fund1(G.B.), Uri Hanhwa Eureka Private Equity Fund, Japanese Hotel Real Estate Private Equity Fund 2, Partner One Value Up I Private Equity Fund, PCC-Woori LP Secondary Fund, Godo Kaisha Oceanos 1 and etc., as of June 30, 2020. |
- 120 -
(3) | Major loan transactions with related parties for the six-month periods ended June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||||||
Related parties |
Beginning balance | Loan | Collection | Others |
Ending balance (*) | |||||||||||||||||
Associates | W Service Network Co., Ltd. | 21 | 121 | 128 | - | 14 | ||||||||||||||||
Korea Credit Bureau Co., Ltd. | 1 | 4 | 4 | - | 1 | |||||||||||||||||
Korea Finance Security Co., Ltd. | 3,440 | 178 | 195 | - | 3,423 | |||||||||||||||||
LOTTE CARD Co., Ltd. | 7,500 | - | 1,875 | - | 5,625 | |||||||||||||||||
K BANK Co., Ltd. | 104 | 933 | 975 | - | 62 | |||||||||||||||||
Godo Kaisha Oceanos 1 | 44,036 | - | - | (1,342 | ) | 42,694 |
(*) | Payments that occurred for business reasons among related parties are excluded and net increase or decrease was used for limited credit loan. |
For the six-month period ended June 30, 2020 | ||||||||||||||||||
Related parties |
Beginning balance | Loan | Collection |
Ending balance (*) | ||||||||||||||
Associates | W Service Network Co., Ltd. | 23 | 190 | 192 | 21 | |||||||||||||
Korea Credit Bureau Co., Ltd. | 3 | 8 | 10 | 1 | ||||||||||||||
Korea Finance Security Co., Ltd. | 1,860 | 2,356 | 277 | 3,939 | ||||||||||||||
Chin Hung International Inc | 244 | 1,095 | 1,192 | 147 | ||||||||||||||
LOTTE CARD Co., Ltd. | 7,500 | - | - | 7,500 | ||||||||||||||
K BANK Co., Ltd. | 141 | 896 | 946 | 91 | ||||||||||||||
Well to Sea No. 3 Private Equity Fund | 4,490 | 66,710 | - | 71,200 |
(*) | Payments that occurred for business reasons among related parties are excluded and net increase or decrease was used for limited credit loan. |
(4) | Details of changes in major deposits due to customers with related parties for the six-month period June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30, 2021 | ||||||||||||||||||
Related parties |
Beginning balance | Increase | Decrease |
Ending balance (*) | ||||||||||||||
Associates | W Service Networks Co., Ltd | 1,180 | - | - | 1,180 | |||||||||||||
Partner One Value Up I Private Equity Fund | 863 | 637 | 914 | 586 | ||||||||||||||
Korea Credit Bureau Co., Ltd. | 1,000 | - | 1,000 | - |
(*) | Details of payment between related parties, demand deposit due to customers and etc. are excluded. |
For the six-month period ended June 30, 2020 | ||||||||||||||||||
Related parties |
Beginning balance | Borrowings |
Repayment and others |
Ending balance (*1) | ||||||||||||||
Associates | Saman Corporation (*2) | 2,522 | 94 | - | 2,616 | |||||||||||||
W Service Networks Co., Ltd | 1,180 | - | - | 1,180 | ||||||||||||||
Chin Hung International Inc | 400 | - | 400 | - | ||||||||||||||
Partner One Value Up I Private Equity Fund | 1,150 | 1,356 | 1,303 | 1,203 | ||||||||||||||
Korea Credit Bureau Co., Ltd. | - | 1,000 | - | 1,000 |
(*1) | Details of payment between related parties, demand deposit due to customers and etc. are excluded. |
(*2) | Excluded from the related parties due to the loss of significant influence for the six-month period ended June 30, 2020. |
(5) | There are no major borrowing transactions with related parties for the six-month periods ended June 30, 2021 and 2020. |
- 121 -
(6) | Guarantees provided to the related parties are as follows (Unit: Korean Won in millions): |
Warrantee | June 30, 2021 | December 31, 2020 | Warranty | |||||||
Korea Finance Security Co., Ltd. | 837 | 820 | Unused loan commitment | |||||||
Korea Credit Bureau Co., Ltd. | 34 | 34 | Unused loan commitment | |||||||
W Service Network Co., Ltd. | 186 | 179 | Unused loan commitment | |||||||
Chin Hung International Inc. | - | 16,167 | Unused loan commitment | |||||||
K BANK Co., Ltd. | 238 | 196 | Unused loan commitment | |||||||
LOTTE CARD Co. Ltd. | 500,000 | 500,000 | Unused loan commitment |
As of June 30, 2021 and December 31, 2020, the recognized payment guarantee provisions are 114 million Won and 284 million Won, respectively, in relation to the guarantees provided to the related parties above.
(7) | Amount of commitments with the related parties |
Warrantee | June 30, 2021 | December 31, 2020 | Warranty | |||||||
Together-Korea Government Private Pool Private Securities Investment Trust No. 3 | - | 990,000 | Securities purchase commitment | |||||||
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership | 4,664 | 9,704 | Securities purchase commitment | |||||||
Woori G Senior Loan No. 1 | 40,050 | 53,041 | Securities purchase commitment | |||||||
Woori G Clean Energy No. 1 | 6,023 | 7,485 | Securities purchase commitment | |||||||
Woori Seoul Beltway Private Special Asset Fund | 40,558 | 41,393 | Securities purchase commitment | |||||||
Woori-Shinyoung Growth-Cap Private Equity Fund I | 2,378 | 12,799 | Securities purchase commitment | |||||||
Woori-Q Corporate Restructuring Private Equity Fund | 36,355 | 36,355 | Securities purchase commitment | |||||||
Union Technology Finance Investment Association | 4,500 | 10,500 | Securities purchase commitment | |||||||
Genesis Eco No. 1 Private Equity Fund | 1,296 | - | Securities purchase commitment | |||||||
Genesis Environmental Energy Company 1st Private Equity Fund | 916 | 916 | Securities purchase commitment | |||||||
JC Assurance No. 2 Private Equity Fund | 1,351 | 1,650 | Securities purchase commitment | |||||||
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund | 488 | 550 | Securities purchase commitment | |||||||
PCC-Woori LP Secondary Fund | - | 2,525 | Securities purchase commitment |
(8) | Compensation for key management is as follows (Unit: Korean Won in millions): |
For the six-month period ended June 30 | ||||||||
2021 | 2020 | |||||||
Short-term employee salaries | 10,335 | 8,084 | ||||||
Retirement benefit service costs | 409 | 311 | ||||||
Share-based compensation | 3,079 | 1,054 | ||||||
Total | 13,823 | 9,449 | ||||||
Key management includes executives and directors of Woori Financial Group and major subsidiaries, and also includes CEO of other subsidiaries. Outstanding assets from transactions with key management amount to 3,576 million Won and 3,888 million Won, as of June 30, 2021 and December 31, 2020, respectively and with respect to the assets, the Group has not recognized any allowance nor related impairment loss due to credit losses. Also, liabilities from transaction with key management amount to 12,995 million Won and 11,155 million Won, respectively, as of June 30, 2021 and December 31, 2020.
- 122 -
40. | LEASES |
(1) | Lessor |
1) | Finance lease |
① | The total investment in finance lease and the present value of the minimum lease payments to be recovered are as follows (Unit: Korean Won in millions): |
June 30, 2021 | ||||||||
Total investment in lease | Net investment in lease | |||||||
Within one year | 45,432 | 44,203 | ||||||
After one year but within two years | 85,409 | 79,693 | ||||||
After two years but within three years | 192,757 | 175,280 | ||||||
After three years but within four years | 280,326 | 251,129 | ||||||
After four years but within five years | 449,155 | 397,566 | ||||||
After five years | 44 | 35 | ||||||
Total | 1,053,123 | 947,906 | ||||||
December 31, 2020 | ||||||||
Total investment in lease | Net investment in lease | |||||||
Within one year | 24,649 | 23,957 | ||||||
After one year but within two years | 48,781 | 45,575 | ||||||
After two years but within three years | 132,894 | 120,414 | ||||||
After three years but within four years | 171,137 | 151,756 | ||||||
After four years but within five years | 277,282 | 244,481 | ||||||
After five years | 16 | 12 | ||||||
Total | 654,759 | 586,195 | ||||||
② | The unrealized interest income of the finance lease is as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Total investment in lease | 1,053,123 | 654,759 | ||||||
Net investment in lease | 947,906 | 586,195 | ||||||
Present value of minimum lease payments | 947,906 | 586,133 | ||||||
Present value of unguaranteed residual value | - | 62 | ||||||
Unearned interest income | 105,217 | 68,564 | ||||||
2) | Operating lease |
① | The details of operating lease assets are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Prepaid lease assets | 3,272 | 199 | ||||||
Operating lease assets | ||||||||
Acquisition cost | 1,749,061 | 1,506,957 | ||||||
Accumulated depreciation | (439,659 | ) | (390,981 | ) | ||||
Net carrying value | 1,309,402 | 1,115,976 | ||||||
Total | 1,312,674 | 1,116,175 | ||||||
- 123 -
② | The details of changes in operating lease assets as of June 30, 2021 are as follows and there is no details of changes in operating lease assets as of June 30, 2020 (Unit: Korean Won in millions): |
Amount | ||||
Beginning balance | 1,116,175 | |||
Acquisition | 349,216 | |||
Disposal | (48,682 | ) | ||
Depreciation | (112,279 | ) | ||
Others | 4,972 | |||
Ending balance | 1,309,402 | |||
③ | The future lease payments to be received under the lease contracts are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Within one year | 281,821 | 240,005 | ||||||
After one year but within two years | 258,541 | 223,074 | ||||||
After two years but within three years | 179,794 | 156,859 | ||||||
After three years but within four years | 102,071 | 80,174 | ||||||
After four years but within five years | 41,582 | 24,992 | ||||||
Total | 863,809 | 725,104 | ||||||
④ | There is no adjusted lease payments recognized as profit or loss for the six-month periods ended June 30, 2021 and 2020. |
(2) | Lessee |
1) | The future lease payments under the lease contracts are as follows (Unit: Korean Won in millions): |
June 30, 2021 | December 31, 2020 | |||||||
Lease payments | ||||||||
Within one year | 156,276 | 173,885 | ||||||
After one year but within five years | 150,455 | 200,844 | ||||||
After five years | 37,241 | 34,787 | ||||||
Total | 343,972 | 409,516 | ||||||
2) | Total cash outflows from lease are as follows (Unit: Korean Won in millions): |
For the six-month periods ended June 30 | ||||||||
2021 | 2020 | |||||||
Total cash outflows from lease | 93,758 | 103,985 |
3) | Details of lease payments that are not included in the measurement of lease liabilities due to the fact that they are short-term leases or leases for which the underlying asset is of low value are as follows (Unit: Korean Won in millions): |
For the six-month periods ended June 30 | ||||||||
2021 | 2020 | |||||||
Lease payments for short-term leases | 814 | 743 | ||||||
Lease payments for which the underlying asset is of low value | 721 | 274 | ||||||
Total | 1,535 | 1,017 | ||||||
4) | The Group uses a practical expedient for rent concession as a direct consequence of COVID-19. Accordingly, the amount recognized in profit or loss during the reporting period is 19,311 million Won, to reflect changes in lease payments arising from the rent concession. |
- 124 -
41. | EVENTS AFTER THE REPORTING PERIOD |
(1) | On June 4, 2021, the Group signed a share exchange agreement to exchange 1.0567393 share of Woori Financial Group Inc. for 1 share of each shareholders (excluding the Group) of Woori Financial Capital Co., Ltd. on August 10, 2021. On July 23, 2021, the Board of Directors on behalf of the shareholders' meeting of the Group and Woori Financial Capital Co., Ltd. approved the comprehensive exchange of shares under the above share exchange agreement and share exchange contract amendment. The Company's new shares will go on public on August 27, 2021. |
(2) | On July 23, 2021, the Board of Directors resolved to pay an interim dividend of 150 Won per share (total dividend of 108,340 million Won) with July 30, 2021 as the dividend base date. |
- 125 -
Attachments
- Original document
- Permalink
Disclaimer
Woori Financial Group Inc. published this content on 17 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 August 2021 10:53:04 UTC.