Woori Financial Group (316140) Q2 2025 earnings summary

Executive summary

• Net income for H1 2025 was KRW 1.552 trillion, down 11.6% year-over-year, but adjusted profit was stable excluding one-off costs; ROE reached 10.28% excluding one-offs.

• Net operating revenue grew 2.3% year-over-year to KRW 5.4 trillion, with Q2 net income rebounding to KRW 934.6 billion, up KRW 300 billion from Q1.

• Strategic acquisitions of Dongyang Life and ABL Life completed, expanding the group’s non-bank portfolio and finalizing a comprehensive financial group structure.

• Maintained robust credit ratings (AAA/AA-) and strong ESG performance, including MSCI AAA and DJSI World Index inclusion.

• Maintained a solid profit base through asset rebalancing, focusing on prime assets and reducing exposure to macro-sensitive sectors.

Financial highlights

• Group CET1 ratio reached 12.8% as of June 2025, up 70 bps year-over-year and above the 12.5% target.

• Net operating revenue for H1 2025 was KRW 5.4 trillion; interest income increased 2.7% year-over-year to KRW 4.514 trillion.

• SG&A expenses rose 18% year-over-year to KRW 2.48 trillion, mainly due to one-off costs and investments in digital and IT.

• Cost-to-income ratio stood at 42.8% for H1 2025; group-wide cost-to-income ratio was 55.6%.

• Non-interest income for H1 was KRW 886.3 billion, flat year-over-year but up 47% quarter-over-quarter in Q2.

Outlook and guidance

• CET1 ratio target for year-end is to stably maintain above 12.5%, with efforts to reach 13% earlier than planned.

• NIM guidance for H2 2025 is to remain at the low to mid 1.4% range.

• Credit cost ratio for 2025 expected to be managed in the low to mid 40 bps range.

• Focus on balanced growth between banking and non-banking, leveraging new insurance subsidiaries for group synergies.

• Continued investment in digital/IT and ESG initiatives, with ongoing cost efficiency measures.