WF 0001193125-20-221609 6-K as filed: Aug 17, 2020

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Exhibit 99.1

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM FINANCIAL STATEMENTS

AS OF AND FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED

JUNE 30, 2020 AND 2019

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		4-5

Consolidated Interim Statements of Comprehensive Income		6-7

Consolidated Interim Statements of Changes in Equity		8

Consolidated Interim Statements of Cash Flows		9-10

Notes to the Consolidated Interim Financial Statements		11-115

Report on Review of Consolidated Interim Financial Statements

English Translation of a Report Originally Issued in Korean

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 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, 2020 and the related consolidated interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2020, and consolidated interim statements of changes in equity and cash flows for the six-month period ended June 30, 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.

LOGO

- 1 -

Emphasis of Matters

Without qualifying our conclusion, we draw attention to Note 3 of the financial statements, which indicates that the outbreak of COVID-19 in 2020 may have a negative impact on the Group’s financial condition and results of operations. Our conclusion is not affected by this item.

Other Matters

The consolidated interim financial statements of comprehensive income for the three-month and six-month periods ended June 30, 2019, and consolidated interim statements of changes in equity and cash flows for the six-month period ended June 30, 2019, presented herein for comparative purposes, were reviewed by Deloitte Anjin LLC whose report dated August 14, 2019. Based on their review, nothing has come to their attention that causes them to believe the accompanying financial statements do not present fairly, in all material respects, in accordance with Korean IFRS 1034 Interim Financial Reporting.

The consolidated financial statements of the Group for the year ended December 31, 2019, were audited by Deloitte Anjin LLC who expressed an unqualified opinion on those statements, not presented herein, on March 16, 2020. The consolidated statement of financial position as at December 31, 2019, presented herein for comparative purposes, is consistent, in all material respects, with the above audited statement of financial position as at December 31, 2019.

/s/ Samil PricewaterhouseCoopers

August 14, 2020

Notice to Readers

This report is effective as of August 14, 2020 the review report date. Certain subsequent events or circumstances may have occurred between the review report date and the time the review report is read. Such events or circumstances could significantly affect the consolidated interim financial statements and may result in modifications to the review report.

- 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, 2020 AND 2019

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 Sohn

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, 2020 (UNAUDITED) AND DECEMBER 31, 2019


	June 30, 2020		December 31, 2019
	(Korean Won in millions)
ASSETS
Cash and cash equivalents (Note 6)		9,437,619		6,392,566
Financial assets at fair value through profit or loss (“FVTPL”) (Notes 4, 7, 11, 12, 18 and 26)		10,067,062		8,069,144
Financial assets at fair value through other comprehensive income (“FVTOCI”) (Notes 4, 8, 11, 12, and 18)		29,612,408		27,730,531
Securities at amortized cost (Notes 4, 9, 11, 12 and 18)		18,610,602		20,320,539
Loans and other financial assets at amortized cost (Notes 4, 10, 11, 12, 18 and 41)		306,418,069		293,717,693
Investments in joint ventures and associates (Note 13)		928,161		806,360
Investment properties (Note 14)		312,806		280,239
Premises and equipment (Notes 15 and 18)		3,311,009		3,364,716
Intangible assets (Note 16)		820,380		844,110
Assets held for distribution (sale) (Note 17)		9,614		10,556
Net defined benefit asset (Note 24)		—		2,582
Current tax assets		39,230		47,367
Deferred tax assets		39,440		39,544
Derivative assets (Designated for hedging) (Notes 4,11,12 and 26)		249,880		121,131
Other assets (Notes 19 and 41)		221,096		233,646

Total assets		380,077,376		361,980,724

LIABILITIES
Financial liabilities at fair value through profit or loss (“FVTPL”) (Notes 4, 11, 12, 20 and 26)		4,031,235		2,958,302
Deposits due to customers (Notes 4,11,21 and 41)		276,967,229		264,685,578
Borrowings (Notes 4, 11, 12 and 22)		21,263,126		18,998,920
Debentures (Notes 4, 11 and 22)		31,029,872		30,858,055
Provisions (Notes 23, 40 and 41)		551,389		443,980
Net defined benefit liability (Note 24)		146,325		92,470
Current tax liabilities		102,278		182,690
Deferred tax liabilities		200,263		134,322
Derivative liabilities (Designated for hedging) (Notes 4,11,12 and 26)		15,022		6,837
Other financial liabilities (Notes 4,11,12, 25 and 41)		19,635,458		17,706,767
Other liabilities (Notes 25 and 41)		383,491		420,471

Total liabilities		354,325,688		336,488,392

(Continued)

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WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED IMTERIM STATEMENTS OF FINANCIAL POSITION

AS OF JUNE 30, 2020 (UNAUDITED) AND DECEMBER 31, 2019 (CONTINUED)


	June 30, 2020			December 31, 2019
	(Korean Won in millions)
EQUITY
Owners’ equity (Note 28)
Capital stock		3,611,338			3,611,338
Hybrid securities		1,695,821			997,544
Capital surplus		627,625			626,295
Other equity		(2,285,790	)		(2,249,322	)
Retained earnings		18,652,199			18,524,515
Regulatory reserve for credit loss		(2,547,547	)		(2,356,246	)
Required reversal(provision) of regulatory reserve for credit loss		12,236			(191,301	)
Planned reversal(provision) of regulatory reserve for credit loss		12,236			(191,301	)

		22,301,193			21,510,370

Non-controlling interests		3,450,495			3,981,962

Total equity		25,751,688			25,492,332

Total liabilities and equity		380,077,376			361,980,724

The accompanying notes are part of this consolidated interim financial statement.

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WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2020 AND 2019 (UNAUDITED)


	Periods ended June 30, 2020						Periods ended June 30, 2019
	Three-month			Six-month			Three-month			Six-month
	(Korean Won in millions, except per share data)
Interest income		2,412,189			4,916,003			2,673,958			5,277,692
Financial assets at FVTPL		13,681			26,210			14,771			27,905
Financial assets at FVTOCI		114,823			241,000			113,790			209,102
Financial assets at amortized cost		2,283,685			4,648,793			2,545,397			5,040,685
Interest expense		(934,299	)		(1,975,154	)		(1,197,497	)		(2,346,640	)

Net interest income (Notes 11, 30 and 41)		1,477,890			2,940,849			1,476,461			2,931,052
Fees and commissions income		397,282			807,993			436,680			848,241
Fees and commissions expense		(172,913	)		(309,644	)		(151,591	)		(288,151	)

Net fees and commissions income (Notes 11, 31 and 41)		224,369			498,349			285,089			560,090
Dividend income (Notes 11, 32 and 41)		23,233			71,002			25,100			64,583
Net gain on financial instruments at FVTPL (Notes 11, 33 and 41)		(66,486	)		401,589			63,495			80,081
Net gain on financial assets at FVTOCI (Notes 11 and 34)		8,427			11,027			2,654			3,445
Net gain arising on financial assets at amortized cost (Note 11)		5,915			32,662			73,954			94,619
Net gain on disposals of loans and other financial assets at amortized cost		5,915			32,662			73,954			94,619
Impairment losses due to credit loss (Notes 35 and 41)		(335,787	)		(446,679	)		(76,539	)		(136,546	)
General and administrative expenses (Notes 36 and 41)		(897,032	)		(1,789,558	)		(864,334	)		(1,695,786	)
Other net operating expenses (Notes 11, 26, 37 and 41)		(41,269	)		(546,643	)		(109,467	)		(191,126	)

Operating income		399,260			1,172,598			876,413			1,710,412
Share of gain of joint ventures and associates (Note 13)		16,798			23,952			5,247			10,857
Other non-operating expense		(134,822	)		(162,701	)		20,612			6,813

Non-operating expense (Note 37)		(118,024	)		(138,749	)		25,859			17,670
Net income before income tax expense		281,236			1,033,849			902,272			1,728,082
Income tax expense (Note 38)		64,974			259,816			244,838			456,119

(Continued)

- 6 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2020 AND 2019 (UNAUDITED) (CONTINUED)


	Periods ended June 30, 2020						Periods ended June 30, 2019
	Three-month			Six-month			Three-month			Six-month
	(Korean Won in millions, except per share data)
Net income
(Net income after the provision of regulatory reserve for credit loss for the six-month period ended June 30, 2020 and 2019, is 786,269 million Won and 1,152,718 million Won, respectively, and net income after the provision of regulatory reserve for credit loss for the three-month period ended June 30, 2020 and 2019 are 296,417 million Won and 619,275 million Won, respectively) (Note 28)		216,262			774,033			657,434			1,271,963

Net loss on valuation of equity securities at FVTOCI		14,957			(95,214	)		(35,133	)		(47,377	)
Remeasurement loss related to defined benefit plan		(6,911	)		(26,240	)		(6,732	)		(39,268	)

Items that will not be reclassified to profit or loss:		8,046			(121,454	)		(41,865	)		(86,645	)

Net gain on valuation of debt securities at FVTOCI		45,464			69,463			31,001			53,937
Changes in capital due to equity method		(3,614	)		(4,621	)		(92	)		(418	)
Net gain on foreign currency translation of foreign operations		43,478			57,475			37,457			102,794
Net gain (loss) on valuation of cash flow hedge		(545	)		(10,030	)		(1,572	)		(1,170	)

Items that may be reclassified to profit or loss:		84,783			112,287			66,794			155,143
Other comprehensive income (loss), net of tax		92,829			(9,167	)		24,929			68,498
Total comprehensive income		309,091			764,866			682,363			1,340,461

Net income attributable to:		216,262			774,033			657,434			1,271,963
Net income attributable to owners		142,348			660,564			610,999			1,179,688
Net income attributable to non-controlling interests		73,914			113,469			46,435			92,275
Total comprehensive income attributable to:		309,091			764,866			682,363			1,340,461
Comprehensive income attributable to owners		221,161			648,420			632,796			1,240,153
Comprehensive income attributable to non-controlling interests		87,930			116,446			49,567			100,308
Earnings per share (Note 39)
Basic and diluted earnings per share (Unit: In Korean Won)		181			887			899			1,755

The accompanying notes are part of this consolidated interim financial statement.

- 7 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY

FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2020 AND 2019 (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, 2019		3,381,392		3,161,963			285,889			(2,213,970	)		17,124,657			21,739,931			213,113			21,953,044
Total comprehensive income
Net income		—		—			—			—			1,179,688			1,179,688			92,275			1,271,963
Net gain on valuation of financial instruments at FVTOCI		—		—			—			6,491			—			6,491			69			6,560
Changes in other comprehensive income due to disposal of equity securities at FVTOCI		—		—			—			27,002			(27,002	)		—			—			—
Changes in capital due to equity method		—		—			—			(418	)		—			(418	)		—			(418	)
Gain on foreign currency translation of foreign operations		—		—			—			94,591			—			94,591			8,203			102,794
Loss on valuation of cash flow hedge		—		—			—			(1,170	)		—			(1,170	)		—			(1,170	)
Remeasurement loss related to defined benefit plan		—		—			—			(39,029	)		—			(39,029	)		(239	)		(39,268	)
Transactions with owners
Dividends to common stocks		—		—			—			—			(437,626	)		(437,626	)		(2,002	)		(439,628	)
Acquisition of subsidiaries		19,430		—			25,878			—			—			45,308			10			45,318
New stocks issue cost		—		—			(3	)		—			—			(3	)		—			(3	)
Net increase of treasury stocks		—		—			—			17,230			—			17,230			—			17,230
Dividends to hybrid securities		—		—			—			—			—			—			(78,290	)		(78,290	)
Exchange of non-controlling interests in hybrid securities		—		(3,161,963	)		—			—			—			(3,161,963	)		3,161,963			—
Changes in subsidiaries’ capital		—		—			99			—			—			99			(13	)		86
Appropriation of retained earnings		—		—			—			368			(368	)		—			—			—

June 30, 2019 (Unaudited)		3,400,822		—			311,863			(2,108,905	)		17,839,349			19,443,129			3,395,089			22,838,218

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	)
Changes in other comprehensive income 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
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

The accompanying notes are part of this consolidated interim financial statement.

- 8 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2020 AND 2019 (UNAUDITED)


	For the six-month period ended June 30
	2020			2019
	(Korean Won in millions)
Cash flows from operating activities:
Net income		774,033			1,271,963
Adjustments to net income:
Income tax expense		259,816			456,119
Interest income		(4,916,003	)		(5,277,692	)
Interest expense		1,975,154			2,346,640
Dividend income		(71,002	)		(64,583	)

		(2,752,035	)		(2,539,516	)

Additions of expenses not involving cash outflows:
Loss on financial assets at FVTOCI		344			164
Impairment loss due to credit loss		446,679			136,546
Loss on other provisions		169,349			13,972
Retirement benefit		86,185			83,071
Depreciation and amortization		266,837			226,632
Net loss on foreign currency translation		339,687			—
Loss on derivatives (designated for hedge)		9,324			1,524
Loss on fair value hedge		108,090			90,198
Loss on valuation of investments in joint ventures and associates		11,731			8,442
Loss on disposal of premises and equipment, intangible assets and other assets		821			1,248
Impairment loss on premises and equipment, intangible assets and other assets		8,254			1,680

		1,447,301			563,477

Deductions of income not involving cash inflows:
Gain on valuation of financial instruments at FVTPL		249,455			85,953
Gain on financial assets at FVTOCI		11,371			3,609
Gain on other provisions		124			3,375
Gain on derivatives (designated for hedge)		132,356			118,154
Gain on valuation of investments in joint ventures and associates		35,683			19,299
Gain on disposal of premises and equipment, intangible assets and other assets		6,575			1,302
Reversal of impairment loss on premises and equipment, intangible assets and other assets		55			722
Other income		4,608			—

		440,227			232,414

Changes in operating assets and liabilities:
Financial instruments at FVTPL		(167,347	)		747,897
Loans and other financial assets at amortized cost		(12,171,466	)		(11,154,473	)
Other assets		(56,319	)		151,747
Deposits due to customers		11,526,133			7,426,159
Provisions		(90,706	)		(6,843	)
Net defined benefit liability		(67,202	)		(117,182	)
Other financial liabilities		1,929,411			3,673,978
Other liabilities		(38,327	)		(10,093	)

		864,177			711,190

Interest income received		5,052,912			5,108,638
Interest expense paid		(2,268,755	)		(2,120,787	)
Dividends received		71,134			64,689
Income tax paid		(236,188	)		(272,284	)

Net cash inflow from operating activities		2,512,352			2,554,956

(Continued)

- 9 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2020 AND 2019 (UNAUDITED) (CONTINUED)


	For the six-month period ended June 30
	2020			2019
	(Korean Won in millions)
Cash flows from investing activities:
Cash in-flows from investing activities:
Net cash in-flows from hedging activities		499			—
Disposal of financial instruments at FVTPL		3,485,089			6,206,458
Disposal of financial assets at FVTOCI		11,062,888			4,984,305
Redemption of securities at amortized cost		3,406,645			4,803,559
Disposal of investments in joint ventures and associates		32,162			26,691
Disposal of investment properties		354			22
Disposal of premises and equipment		17,212			6,973
Disposal of intangible assets		371			995
Net cash flow from changes in subsidiaries		—			6,131

		18,005,220			16,035,134

Cash out-flows from investing activities:
Acquisition of financial instruments at FVTPL		3,995,877			7,540,803
Acquisition of financial assets at FVTOCI		12,883,464			12,214,487
Acquisition of securities at amortized cost		1,678,871			2,353,102
Acquisition of investments in joint ventures and associates		130,261			8,915
Acquisition of investment properties		1,514			135,974
Acquisition of premises and equipment		57,266			97,859
Acquisition of intangible assets		56,640			65,350
Net increase of other assets		2,671			—

		18,806,564			22,416,490

Net cash outflow from investing activities		(801,344	)		(6,381,356	)

Cash flows from financing activities:
Cash in-flows from financing activities:
Increase in borrowings		8,171,641			7,924,071
Issuance of debentures		10,849,477			14,119,727
Net increase of other liabilities		5,516			—
Issuance of hybrid securities		698,277			—
Retirement of treasury stocks		—			256,415

		19,724,911			22,300,213

Cash out-flows from financing activities:
Net cash out-flows from hedging activities		6,054			—
Decrease in borrowings		6,211,491			5,182,146
Redemption of debentures		10,893,170			12,544,547
Redemption of lease liabilities		102,968			95,887
New stock issue cost		—			16,326
Acquisition of treasury stocks		—			184,164
Dividends paid		505,587			437,626
Redemption of hybrid stocks		598,850			—
Dividends paid to hybrid securities		110,456			78,059
Dividends paid to non-controlling interest		2,054			2,002

		18,430,630			18,540,757

Net cash inflow from financing activities		1,294,281			3,759,456

Net increase (decrease) in cash and cash equivalents		3,005,289			(66,944	)
Cash and cash equivalents, beginning of the period		6,392,566			6,747,894
Effects of exchange rate changes on cash and cash equivalents		39,764			157,626

Cash and cash equivalents, end of the period (Note 6)		9,437,619			6,838,576

The accompanying notes are part of this consolidated interim financial statement.

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WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS

AS OF JUNE 30, 2020 AND 2019 (UNAUDITED)

1.	GENERAL

(1)	Summary of the Parent company

Woori Financial Group, Inc. (hereinafter referred to the “Group” or the “Parent 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 at the establishment while the Korea Deposit Insurance Corp. (“KDIC”), the Parent company’s largest shareholder, owns 124,604,797 shares (17.25%) 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 59.83% 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.

- 11 -

(2)	Details of the Parent company and subsidiaries (hereinafter ‘Group’) as of June 30, 2020 and December 31, 2019 are as follows:

Percentage of ownership
(%)

Location

Financial

statements date

of use

Subsidiaries

Main business

June 30,
2020

December 31,
2019

Held by Woori Financial Group Inc.

Woori Bank

Bank

100.0

Korea

June 30

Woori Card Co., Ltd.

Finance

100.0

Korea

June 30

Woori Investment Bank Co., Ltd.

Other credit finance business

59.8

Korea

June 30

Woori FIS Co., Ltd.

System software development & maintenance

100.0

Korea

June 30

Woori Finance Research Institute Co., Ltd.

Other service business

100.0

Korea

June 30

Woori Credit Information Co., Ltd.

Credit information

100.0

Korea

June 30

Woori Fund Service Co., Ltd.

Finance

100.0

Korea

June 30

Woori Asset Trust Co., Ltd.

Real estate trust

67.2

Korea

June 30

Woori Asset Management Corp.

Finance

73.0

Korea

June 30

Woori Private Equity Asset Management Co., Ltd.

Finance

100.0

Korea

June 30

Woori Global Asset Management Co., Ltd.

Finance

100.0

Korea

June 30

Held by Woori Bank

Woori America Bank

Finance

100.0

America

June 30

Woori Global Markets Asia Limited

Finance

100.0

Hong Kong

June 30

Woori Bank China Limited

Finance

100.0

China

June 30

AO Woori Bank

Finance

100.0

Russia

June 30

PT Bank Woori Saudara Indonesia 1906 Tbk

Finance

79.9

Indonesia

June 30

Banco Woori Bank do Brasil S.A.

Finance

100.0

Brazil

June 30

Korea BTL Infrastructure Fund

Finance

99.9

Korea

June 30

Woori Finance Cambodia PLC. (*1)

Finance

—

100.0

Cambodia

Woori Finance Myanmar Co., Ltd.

Finance

100.0

Myanmar

June 30

Wealth Development Bank

Finance

51.0

Philippines

June 30

Woori Bank Vietnam Limited

Finance

100.0

Vietnam

June 30

WB Finance Co., Ltd.

Finance

100.0

Cambodia

June 30

Woori Bank Europe

Finance

100.0

Germany

June 30

Kumho Trust First Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Asiana Saigon Inc. (*2)

Asset securitization

0.0

Korea

June 30

KAMCO Value Recreation First Securitization Specialty Co., Ltd. (*2)

Asset securitization

15.0

Korea

June 30

Hermes STX Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

BWL First Co., LLC (*2)

Asset securitization

0.0

Korea

June 30

Deogi Dream Fourth Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Jeonju Iwon Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Wonju I one Inc. (*2)

Asset securitization

0.0

Korea

June 30

Heitz Third Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woorihansoop 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Electric Cable First Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori International First Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori WEBST 1st Co., Ltd. (*2)

Asset securitization

—

0.0

Korea

June 30

Wibihansoop 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Uri QS 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Uri Display 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Tiger Eyes 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori Serveone 1st Co., Ltd. (*2)

Asset securitization

—

0.0

Korea

Uri Display 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori the Colony Unjung Securitization Specialty Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

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Percentage of ownership
(%)

Location

Financial

statements date

of use

Subsidiaries

Main business

June 30,
2020

December 31,
2019

Woori Dream 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori Dream 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori H 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori HS 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori Sinnonhyeon 1st Inc. (*2)

Asset securitization

0.0

Korea

June 30

Woori K 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Uri S 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Smart Casting Inc. (*2)

Asset securitization

0.0

Korea

June 30

Uri Display 3rd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

TY 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori HJ 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori-HJ 3rd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Uri K 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori KC No.1 Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori Lake 1st., Ltd. (*2)

Asset securitization

—

0.0

Korea

Woori QSell 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Quantum Jump the 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Quantum Jump the 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori BK the 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori-HC 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Wivi Synergy 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

ATLANTIC TRANSPORTATION 1 S.A. (*2)

Asset securitization

0.0

Marshall islands

June 30

Woori Gongdeok First Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

HD Project Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori HW 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori HC 2nd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori Dream 3rd Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori SJS 1st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Woori Steel 1^st 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

Korea

June 30

Heungkuk Global Private Placement Investment Trust No. 1 (*3)

Securities investment and others

98.5

Korea

June 30

AI Partners UK Water Supply Private Placement Investment Trust No.2 (*3)

Securities investment and others

97.3

England

June 30

Consus Sakhalin Real Estate Investment Trust 1st (*3)

Securities investment and others

75.0

Korea

June 30

Multi Asset Global Real Estate Investment Trust No. 5-2 (*3)

Securities investment and others

99.0

Korea

June 30

Igis Australia Investment Trust No. 209-1 (*3)

Securities investment and others

99.4

Korea

June 30

INMARK Spain Private Placement Real Estate Investment Trust No. 26-2 (*3)

Securities investment and others

97.7

—

Korea

June 30

WooriG NorthAmerica Infra Private Placement Investment Trust No. 1 (*3)

Securities investment and others

99.3

—

Korea

June 30

Woori Global Development Infrastructure Synergy Company Private Placement Investment Trust No.1 (*3)

Securities investment and others

99.9

Korea

June 30

IGIS Global Private Placement Real Estate Fund No. 316-1 (*3)

Securities investment and others

99.3

Korea

June 30

Woori G Japan Investment Trust No. 1-2 (*3)

Securities investment and others

98.8

—

Korea

June 30

Principal Guaranteed Trust (*4)

Trust

0.0

Korea

June 30

Principal and Interest Guaranteed Trust (*4)

Trust

0.0

Korea

June 30

Held by Multi Asset Global Real Estate Investment Trust No. 5-2:

- 13 -

Percentage of ownership
(%)

Location

Financial

statements date

of use

Subsidiaries

Main business

June 30,
2020

December 31,
2019

MAGI No.5 LuxCo S.a.r.l. (*2)

Asset securitization

54.6

Luxembourg

June 30

Held by MAGI No.5 LuxCo S.a.r.l.:

ADP 16 Brussels (*2)

Asset securitization

0.0

Belgium

June 30

Held by Woori Investment Bank Co., Ltd.:

Dongwoo First Securitization Specialty Co., Ltd. (*2)

Asset securitization

—

5.0

Korea

Seari First Securitization Specialty Co., Ltd. (*2)

Asset securitization

5.0

Korea

June 30

Seari Second Securitization Specialty Co., Ltd. (*2)

Asset securitization

5.0

Korea

June 30

Namjong 1st Securitization Specialty Co.,

Ltd. (*2)

Asset securitization

5.0

Korea

June 30

Bukgeum First Securitization Specialty Co., Ltd. (*2)

Asset securitization

5.0

Korea

June 30

Bukgeum Second Securitization Specialty Co., Ltd. (*2)

Asset securitization

5.0

Korea

June 30

WS1909 Securitization Specialty Co., Ltd. (*2)

Asset securitization

5.0

Korea

June 30

WS2003 Securitization Specialty Co., Ltd. (*2)

Asset securitization

5.0

—

Korea

June 30

WS2006 Securitization Specialty Co., Ltd. (*2)

Asset securitization

5.0

—

Korea

June 30

One Punch Korea the 1st Co., Ltd. (*2).

Asset securitization

0.0

Korea

June 30

One Punch blue the 1^st Co., Ltd. (*2)

Asset securitization

0.0

Korea

June 30

Held by Woori Card Co., Ltd.:

TUTU Finance –WCI Myanmar Co., Ltd.

Finance

100.0

Myanmar

June 30

Woori Card one of 2017-1 Securitization Specialty Co., Ltd. (*2)

Asset securitization

—

0.5

Korea

Woori Card one of 2017-2 Securitization Specialty Co., Ltd. (*2)

Asset securitization

0.5

Korea

June 30

Woori Card one of 2018-1 Securitization Specialty Co., Ltd. (*2)

Asset securitization

0.5

Korea

June 30

Woori Card 2019-1 Asset Securitization Specialty Co., Ltd. (*2)

Asset securitization

0.5

Korea

June 30

Woori Card 2020-1 Asset Securitization Specialty Co., Ltd. (*2)

Asset securitization

0.5

—

Korea

June 30

Held by Woori Private Equity Asset Management Co., Ltd. and Woori Investment Bank Co., Ltd.:

Japanese Hotel Real Estate Private Equity Fund 1 (*3)

Securities investment and others

45.5

Korea

June 30

Held by Woori Asset Management Corp.:

Woori China Convertible Bond Hedging feeder Investment Trust H (debt-oriented hybrid) (*3)

Securities investment and others

98.7

98.8

Korea

June 30

Woori China Convertible Bond Master Fund (debt-oriented hybrid) (*3)

Securities investment and others

95.0

98.6

Korea

June 30

Held by Woori Global Asset Management Co., Ltd.:

WOORIG China Value Equity (C/C(F)) (*3)

Securities investment and others

—

95.1

Korea

WooriG Global Multi Asset Income Private Placement Investment Trust [FoF]_Class Cs (*3)

Securities investment and others

22.2

—

Korea

June 30

- 14 -

Percentage of ownership
(%)

Location

Financial
statements date
of use

Subsidiaries

Main business

June 30,
2020

December 31,
2019

Held by Woori Bank, Woori Investment Bank Co., Ltd and Woori Private Equity Asset Management Co., Ltd.:

Woori Innovative Growth Professional Investment Type Private Investment Trust No.1 (*3)

Securities investment and others

60.0

Korea

June 30

Held by Woori bank and Woori Investment Bank Co., Ltd.:

Heungkuk Woori Tech Company Private Placement Investment Trust No. 1 (*3)

Securities investment and others

100.0

Korea

June 30

(*1)	The entity was merged with WB Finance Co., Ltd., which is a second-tier subsidiary, during current 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.

(3)	The Group has not consolidated the following entities as of June 30, 2020 and December 31, 2019 despite having more than 50% ownership interest:

As of June 30, 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

52.4

Heungkuk Woori middle priority acquisition Financing 2 types(*)

Korea

Securities Investment

83.0

Kiwoom-Harmony Private Placement Investment Trust No.2 (*)

Korea

Securities Investment

96.0

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

(*)	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.

- 15 -

As of December 31, 2019

Subsidiaries

Location

Main Business

Percentage of
ownership (%)

Golden Bridge NHN Online Private Equity Investment (*)

Korea

Securities Investment

60.0

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

(*)	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.

(4)	The summarized financial information of the major subsidiaries are as follows. The financial information of each subsidiary was prepared on the basis of consolidated financial statements. (Unit: Korean Won in millions):


	As of and 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		365,351,997		342,347,344		13,836,037		677,937			696,858
Woori Card Co., Ltd.		10,783,650		8,795,540		708,328		79,654			50,029
Woori Investment Bank Co., Ltd.		3,773,077		3,374,438		135,093		31,435			31,301
Woori FIS Co., Ltd.		93,868		55,749		128,979		2,220			2,152
Woori Finance Research Institute Co., Ltd.		5,846		2,157		3,169		242			242
Woori Credit Information Co., Ltd.		39,623		8,882		20,774		1,469			1,311
Woori Fund Service Co., Ltd.		16,752		1,540		6,300		990			990
Woori Asset Trust Co., Ltd.		159,155		45,695		39,079		20,198			20,177
Woori Asset Management Corp.		114,239		4,733		12,059		3,183			2,771
Woori Private Equity Asset Management Co., Ltd.		37,644		2,358		2,424		74			28
Woori Global Asset Management Co., Ltd.		38,304		9,487		5,602		(760	)		(760	)


	As of and for the year ended December 31, 2019
Subsidiaries	Assets		Liabilities		Operating revenue		Net income (loss) attributable to owners			Comprehensive income (loss) attributable to owners
Woori Bank (*1)		348,181,658		325,526,568		22,240,947		1,505,547			1,531,793
Woori Card Co., Ltd.		10,087,342		8,299,175		1,368,234		114,196			111,782
Woori Investment Bank Co., Ltd.		3,398,960		3,031,622		204,655		53,358			52,095
Woori FIS Co., Ltd.		91,079		55,112		244,923		3,107			3,119
Woori Finance Research Institute Co., Ltd.		5,447		1,999		5,452		160			117
Woori Credit Information Co., Ltd.		37,872		7,948		39,118		1,698			1,389
Woori Fund Service Co., Ltd.		16,852		2,109		11,071		1,735			1,735
Woori Asset Trust Co., Ltd. (*2)		139,839		45,410		—		—			—
Woori Asset Management Corp. (*2)		113,037		6,301		9,204		1,720			2,544
Woori Private Equity Asset Management Co., Ltd.		38,243		2,985		4,152		(2,087	)		(2,124	)
Woori Global Asset Management Co., Ltd. (*2)		32,807		3,230		3,588		(1,360	)		(1,360	)

(*1)	The amount is prepared based on the consolidated financial statements of Woori Bank (reflecting the classification of profit or loss of the discontinued operation).

(*2)	The gain or loss information of Woori Asset Trust Co., Ltd., Woori Asset Management Corp. and Woori Global Asset Management Co., Ltd. are prepared on the accumulated gains or losses from the date on which the entities were transferred as subsidiaries, to December 31, 2019.

- 16 -

(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, 2020, the Group provides 1,891,650 million Won of credit facilities for the structured entities mentioned above.

- 17 -

(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 K-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 transfers related risks by the purchase commitments of asset-backed securities or issuance of 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.

‘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.

- 18 -


	June 30, 2020
	Asset securitization vehicle		Structured Finance		Investment Funds		Real-estate trust
Total asset of the unconsolidated structured entities		8,266,927		46,234,075		44,918,870		484,642
Assets recognized in the consolidated financial statements related to the unconsolidated structured entities		5,671,503		2,459,734		3,674,444		57,499
Financial assets at FVTPL		451,584		4,540		2,399,233		1,155
Financial assets at FVTOCI		1,652,891		41,851		—		—
Financial assets at amortized cost		3,565,070		2,396,221		1,098,540		56,344
Investments in joint ventures and associates		—		7,399		176,671		—
Derivative assets		1,958		9,723		—		—
Liabilities recognized in the consolidated financial statements related to the unconsolidated structured entities		219		1,097		—		1,966
Other liabilities (provisions)		219		1,097		—		1,966
The maximum exposure to risks		5,970,750		3,255,317		4,529,834		123,123
Investment assets		5,671,503		2,459,734		3,674,444		57,499
Credit facilities and others		299,247		795,583		855,390		65,624
Loss recognized on unconsolidated structured entities		—		2,186		18,491		304


	December 31, 2019
	Asset securitization vehicle		Structured Finance		Investment Funds		Real-estate trust
Total asset of the unconsolidated structured entities		8,230,254		62,879,421		18,265,273		152,257
Assets recognized in the consolidated financial statements related to the unconsolidated structured entities		5,128,616		2,982,217		1,411,639		57,928
Financial assets at FVTPL		324,414		28,834		1,109,621		655
Financial assets at FVTOCI		2,006,230		42,305		—		—
Financial assets at amortized cost		2,796,695		2,897,620		120,072		57,273
Investments in joint ventures and associates		—		7,475		181,946		—
Derivative assets		1,277		5,983		—		—
Liabilities recognized in the consolidated financial statements related to the unconsolidated structured entities		184		1,291		—		2,808
Derivative liabilities		—		15		—		—
Other liabilities (provisions)		184		1,276		—		2,808
The maximum exposure to risks		5,561,394		3,532,539		1,457,398		77,117
Investment assets		5,128,616		2,982,217		1,411,639		57,928
Credit facilities and others		432,778		550,322		45,759		19,189
Loss recognized on unconsolidated structured entities		—		4,660		34,312		5,218

- 19 -

(7)	As of June 30, 2020 and December 31, 2019, the share of non-controlling interests on the net income and equity of subsidiaries in which non-controlling interests are significant are as follows: (Unit: Korean Won in millions):

Accumulated non-controlling interests at the end of the reporting period


	June 30, 2020		December 31, 2019
Woori Bank (*)		3,105,070		3,660,814
Woori Investment Bank		163,869		151,170
Woori Asset Trust Co., Ltd		45,487		40,161
Woori Asset Management Corp		30,480		29,800
PT Bank Woori Saudara Indonesia 1906 Tbk		87,387		83,315
Wealth Development Bank		20,051		18,524

(*)	Hybrid securities issued by Woori Bank

Net income attributable to non-controlling interests


	For the six-month period ended June 30
	2020		2019
Woori Bank (*)		90,091		78,290
Woori Investment Bank		12,753		8,964
Woori Asset Trust Co., Ltd		5,699		—
Woori Asset Management Corp		791		—
PT Bank Woori Saudara Indonesia 1906 Tbk		3,796		4,920
Wealth Development Bank		321		79

(*)	Distribution of the hybrid securities issued by Woori Bank

Dividends to non-controlling interests


	For the six-month period ended June 30
	2020		2019
Woori Bank (*)		90,091		78,290
Woori Asset Trust Co., Ltd		365		—
PT Bank Woori Saudara Indonesia 1906 Tbk		1,669		1,981

(*)	Distribution of the hybrid securities issued by Woori Bank

- 20 -

2.	BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES

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, 2019 for understanding of the accompanying interim financial statements.

(1)

Except for the impacts on the newly adopted standards and interpretations explained below, the accounting policies applied in preparing the accompanying condensed consolidated interim financial statements have been applied consistently with the annual consolidated financial statements as of and for the year ended December 31, 2019.

Amendments to Korean IFRS 1103 Business Combination – Definition of a Business

To consider the integration of the required activities and assets as a business, the amended definition of a business requires an acquisition to include an input and a substantive process that together significantly contribute to the ability to create outputs and excludes economic benefits from the lower costs. An entity can apply a concentration test, an optional test, where substantially all of the fair value of gross assets acquired is concentrated in a single asset or a group of similar assets, the assets acquired would not represent a business. The amendment does not have a significant impact on the financial statements.

Amendments to Korean IFRS 1001 Presentation of Financial Statements and Korean IFRS 1008 Accounting policies, changes in accounting estimates and errors – Definition of Material

The amendments clarify the explanation of the definition of material and amended Korean IFRS 1001 and Korean IFRS 1008 in accordance with the clarified definitions. Materiality is assessed by reference to omission or misstatement of material information as well as effects of immaterial information, and to the nature of the users when determining the information to be disclosed by the Group. The amendment does not have a significant impact on the financial statements.

Amendments to Korean IFRS 1116 Lease – Practical expedient for COVID-19-Related Rent Exemption, Concessions, Suspension

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. A lessee that makes this election shall account for any change in lease payments resulting from the rent concession the same way it would account for the change applying this Standard if the change were not a lease modification.

With implementation of Korean IFRS 1116 Lease, the Group has changed accounting policy. The Group has adopted Korean IFRS 1116 retrospectively, as permitted under the specific transitional provisions in the standard. There was no cumulative impact on the beginning balance of retained earnings as at January 1, 2020 by retrospectively applying this standard, and the Group did not restate comparatives for the 2019 reporting period. The impact of the adoption of the leasing standard are disclosed in Note 42.

The Group does not expect that these enactments and amendments have a significant impact on the consolidated financial statements.

- 21 -

(2)	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, 2019, 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.

3.	SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS

The outbreak of COVID-19 in 2020 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 loan receivables. Despite the announcement of these various forms of government support policies, the negative impact of the COVID-19 on the global economy continues.

Significant changes have been made in future forecast information affecting expected credit losses for the period of six-month period ended June 30, 2020, and major economic factors are expected to remain negative for a considerable period of time after 2020 due to the influence of COVID-19, and uncertainties in recovery or deterioration will persist.

Considering this situation comprehensively, as of the end June 30, 2020, the Group updated the forward-looking information used to estimate expected credit losses in accordance with K-IFRS 1109 Financial Instruments by changing major variables such as GDP to reflect the impact of COVID-19, which has brought about a global economic recession. As a result, the credit loss allowance has increased 175,478 million Won (consists of 162,911 million Won for Woori Bank, 9,764 million Won for Woori Card, and 2,803 million Won for Woori Investment Bank.) The Group will continue to evaluate future prospects related to the duration of COVID-19’s economic impact and the government’s policies every quarter.

The 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, 2019, unless otherwise stated.

- 22 -

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 and 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 office (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.

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, 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.

- 23 -

Maximum exposure to credit risk

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, 2020 and December 31, 2019 is as follows (Unit: Korean Won in millions):


		June 30, 2020		December 31, 2019
Loans and other financial assets at amortized cost	Korean treasury and government agencies		11,208,287		14,797,040
	Banks		21,782,441		18,597,206
	Corporates		109,829,991		101,041,110
	Consumers		163,597,350		159,282,337

	Sub-total		306,418,069		293,717,693

Financial assets at FVTPL (*)	Deposit		29,631		27,901
	Debt securities		2,507,653		2,337,085
	Loans		328,602		212,473
	Derivative assets		4,266,297		2,921,903

	Sub-total		7,132,183		5,499,362

Financial assets at FVTOCI	Debt securities		28,804,809		26,795,161
Securities at amortized cost	Debt securities		18,610,602		20,320,539
Derivative assets	Derivative assets (Designated for hedging)		249,880		121,131
Off-balance accounts	Guarantees		12,789,313		12,618,917
	Unused loan commitments		106,987,014		103,651,674

	Sub-total		119,776,327		116,270,591

	Total		480,991,870		462,724,477

(*)	Puttable financial instruments are not included

- 24 -

Credit risk exposure by geographical areas

The following tables analyze credit risk exposure by geographical areas (Unit: Korean Won in millions):


	June 30, 2020
	Korea		China		USA		UK		Japan		Others (*)		Total
Loans and other financial assets at amortized cost		282,322,715		4,751,008		3,881,935		1,561,978		1,178,814		12,721,619		306,418,069
Securities at amortized cost		18,390,596		—		47,437		—		—		172,569		18,610,602
Financial assets at FVTPL		7,090,010		11,251		—		29,631		1,291		—		7,132,183
Financial assets at FVTOCI		25,389,634		511,999		1,632,819		—		6,045		1,264,312		28,804,809
Derivative assets (Designated for hedging)		249,880		—		—		—		—		—		249,880
Off-balance accounts		115,993,317		897,684		424,611		49,236		37,402		2,374,077		119,776,327

Total		449,436,152		6,171,942		5,986,802		1,640,845		1,223,552		16,532,577		480,991,870

(*)	Others consist of financial assets in Indonesia, Hong Kong, Germany, Australia, and other countries.


	December 31, 2019
	Korea		China		USA		UK		Japan		Others (*)		Total
Loans and other financial assets at amortized cost		268,316,454		5,108,144		5,077,666		1,844,374		1,172,209		12,198,846		293,717,693
Securities at amortized cost		20,104,604		—		66,747		—		—		149,188		20,320,539
Financial assets at FVTPL		5,488,229		10,409		—		—		724		—		5,499,362
Financial assets at FVTOCI		24,553,655		332,319		144,601		102,311		2		1,662,273		26,795,161
Derivative assets (Designated for hedging)		121,131		—		—		—		—		—		121,131
Off-balance accounts		112,602,603		1,211,857		387,795		78,850		46,662		1,942,824		116,270,591

Total		431,186,676		6,662,729		5,676,809		2,025,535		1,219,597		15,953,131		462,724,477

(*)	Others consist of financial assets in Indonesia, Hong Kong, Germany, Australia, and other countries.

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, 2020 and December 31, 2019 (Unit: Korean Won in millions):


	June 30, 2020
	Service		Manufacturing		Finance and insurance		Construction		Individuals		Others		Total
Loans and other financial assets at amortized cost		55,564,965		35,763,906		36,200,358		3,317,785		159,203,039		16,368,016		306,418,069
Securities at amortized cost		343,126		6,750		10,427,805		332,818		—		7,500,103		18,610,602
Financial assets at FVTPL		251,335		220,702		5,501,612		21,799		22,228		1,114,507		7,132,183
Financial assets at FVTOCI		249,436		116,768		23,913,643		191,165		—		4,333,797		28,804,809
Derivative assets (Designated for hedging)		—		—		249,880		—		—		—		249,880
Off-balance accounts		17,755,956		23,689,352		10,434,635		3,968,265		56,868,506		7,059,613		119,776,327

Total		74,164,818		59,797,478		86,727,933		7,831,832		216,093,773		36,376,036		480,991,870


	December 31, 2019
	Service		Manufacturing		Finance and insurance		Construction		Individuals		Others		Total
Loans and other financial assets at amortized cost		51,233,088		32,983,972		36,141,770		3,291,001		155,120,055		14,947,807		293,717,693
Securities at amortized cost		8,545,838		—		10,979,001		364,591		—		431,109		20,320,539
Financial assets at FVTPL		162,780		128,666		4,084,698		39,193		15,430		1,068,595		5,499,362
Financial assets at FVTOCI		85,609		139,098		18,968,456		10,047		9,241		7,582,710		26,795,161
Derivative assets (Designated for hedging)		—		—		121,131		—		—		—		121,131
Off-balance accounts		17,813,366		23,841,881		10,015,897		4,161,139		53,335,209		7,103,099		116,270,591

Total		77,840,681		57,093,617		80,310,953		7,865,971		208,479,935		31,133,320		462,724,477

- 25 -

②

The detailed industries of financial assets and corporate loans that might get affected by the spread of COVID-19 as of June 30, 2020 are as follow and the industries that can be affected may change by future economic conditions. (Unit: Korean Won in millions):

< Woori Bank >


			Loans and other financial assets at amortized cost		Financial assets at FVTPL		Financial assets at FVTOCI
Service business	Distribution business	General retail business		1,519,530		5,711		6,002
		Cosmetics		48,898		100		—
		Sub-total		1,568,428		5,811		6,002
	Accommodation business			1,625,207		5,489		6,002
	Travel business			93,709		78		—
	Art/sports, leisure service			1,303,996		19,830		—
	Food business			1,083,793		1,881		—
	Air transport business			274,924		463		—
	Sub-total			5,950,057		33,552		12,004
Manufacturing	Cosmetics			321,848		278		—

	Total			6,271,905		33,830		12,004


			Off-balance accounts		Total
Service business	Distribution business	General retail business		1,025,404		2,556,647
		Cosmetics		31,216		80,214
	Sub-total			1,056,620		2,636,861
	Accommodation business			148,513		1,785,211
	Travel business			21,830		115,617
	Art/sports, leisure service			80,987		1,404,813
	Food business			161,437		1,247,111
	Air transport business			201,070		476,457
	Sub-total			1,670,457		7,666,070
Manufacturing	Cosmetics			70,451		392,577

	Total			1,740,908		8,058,647

< Woori Card Co., Ltd. >


	Loans and other financial assets at amortized cost		Financial assets at FVTPL		Financial assets at FVTOCI		Off-balance accounts		Total
Accommodation business		2,380		—		—		12,724		15,104
Travel business		1,926		—		—		18,871		20,797
Aviation		541		—		—		2,701		3,242
Cosmetics industry		2,464		—		—		13,036		15,500
Distribution business		6,852		—		—		42,470		49,322
Food industry		29,866		—		—		188,864		218,730
Art/sports, leisure service		6,887		—		—		47,810		54,697
Total		50,916		—		—		326,476		377,392

< Woori Investment Bank Co., Ltd. >


	Loans and other financial assets at amortized cost		Financial assets at FVTPL		Financial assets at FVTOCI		Off-balance accounts		Total
Accommodation business		54,400		—		—		—		54,400
Distribution business		27,707		—		—		—		27,707
Art/sports, leisure service		18,000		—		—		—		18,000
Total		100,107		—		—		—		100,107

- 26 -

Credit risk exposure

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, 2020 and December 31, 2019 is as follows (Unit: Korean Won in millions):


	June 30, 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)		Stage 3		Total		Loss allowance			Total, net
Loans and other financial assets at amortized cost		269,075,108		19,582,226		8,186,194		9,815,662		1,538,922		308,198,112		(1,780,043	)		306,418,069
Korean treasury and government agencies		11,203,774		7,260		28		—		—		11,211,062		(2,775	)		11,208,287
Banks		21,617,966		103,205		58,243		—		27,609		21,807,023		(24,582	)		21,782,441
Corporates		91,524,519		14,267,567		533,388		3,789,419		841,801		110,956,694		(1,126,703	)		109,829,991
General business		60,897,909		9,219,829		488,249		2,633,192		485,066		73,724,245		(767,133	)		72,957,112
Small- and medium-sized enterprise		25,308,013		4,830,679		45,139		1,071,132		326,014		31,580,977		(317,458	)		31,263,519
Project financing and others		5,318,597		217,059		—		85,095		30,721		5,651,472		(42,112	)		5,609,360
Consumers		144,728,849		5,204,194		7,594,535		6,026,243		669,512		164,223,333		(625,983	)		163,597,350
Securities at amortized cost		18,616,159		—		—		—		—		18,616,159		(5,557	)		18,610,602
Financial assets at FVTOCI (*3)		28,664,453		140,356		—		—		—		28,804,809		(9,184	)		28,804,809

Total		316,355,720		19,722,582		8,186,194		9,815,662		1,538,922		355,619,080		(1,794,784	)		353,833,480


	June 30, 2020
	Collateral value
	Stage 1		Stage 2		Stage 3		Total
Loans and other financial assets at amortized cost		177,843,796		13,985,335		710,642		192,539,773
Korean treasury and government agencies		—		—		—		—
Banks		845,959		—		—		845,959
Corporates		60,271,450		2,719,002		397,811		63,388,263
General business		33,453,429		1,831,783		197,005		35,482,217
Small- and medium-sized enterprise		24,634,801		887,219		178,237		25,700,257
Project financing and others		2,183,220		—		22,569		2,205,789
Consumers		116,726,387		11,266,333		312,831		128,305,551
Securities at amortized cost		—		—		—		—
Financial assets at FVTOCI (*3)		—		—		—		—

Total		177,843,796		13,985,335		710,642		192,539,773

(*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 loss allowance because loss allowance does not reduce the carrying amount.

- 27 -


	December 31, 2019
	Stage 1				Stage 2				Stage 3		Total		Loss allowance			Total, net
	Above appropriate credit rating (*1)		Less than a limited credit rating (*3)		Above appropriate credit rating (*2)		Less than a limited credit rating (*3)		Stage 3		Total		Loss allowance			Total, net
Loans and other financial assets at amortized cost		255,709,205		19,823,451		8,712,860		9,625,024		1,504,172		295,374,712		(1,657,019	)		293,717,693
Korean treasury and government agencies		14,789,933		10,390		—		—		1		14,800,324		(3,284	)		14,797,040
Banks		18,336,664		109,667		150,318		—		21,907		18,618,556		(21,350	)		18,597,206
Corporates		82,286,304		15,201,687		485,469		3,267,311		792,375		102,033,146		(992,036	)		101,041,110
General business		45,769,233		6,191,625		441,089		1,620,761		544,238		54,566,946		(678,237	)		53,888,709
Small- and medium-sized enterprise		32,180,551		8,507,800		44,380		1,586,865		230,901		42,550,497		(287,027	)		42,263,470
Project financing and others		4,336,520		502,262		—		59,685		17,236		4,915,703		(26,772	)		4,888,931
Consumers		140,296,304		4,501,707		8,077,073		6,357,713		689,889		159,922,686		(640,349	)		159,282,337
Securities at amortized cost		20,326,050		—		—		—		—		20,326,050		(5,511	)		20,320,539
Financial assets at FVTOCI (*4)		26,684,601		110,560		—		—		—		26,795,161		(8,569	)		26,795,161

Total		302,719,856		19,934,011		8,712,860		9,625,024		1,504,172		342,495,923		(1,671,099	)		340,833,393


	December 31, 2019
	Collateral value
	Stage 1		Stage 2		Stage 3		Total
Loans and other financial assets at amortized cost		169,438,539		14,451,806		692,139		184,582,484
Korean treasury and government agencies		—		—		—		—
Banks		612,200		2,028		—		614,228
Corporates		55,602,818		2,335,496		394,860		58,333,174
General business		22,291,348		1,023,766		240,771		23,555,885
Small- and medium-sized enterprise		31,517,538		1,311,730		145,061		32,974,329
Project financing and others		1,793,932		—		9,028		1,802,960
Consumers		113,223,521		12,114,282		297,279		125,635,082
Securities at amortized cost		—		—		—		—
Financial assets at FVTOCI (*4)		—		—		—		—

Total		169,438,539		14,451,806		692,139		184,582,484

(*1)	Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6.

(*2)	Credit grade of corporates are A- ~ BBB, and consumers are grades 1 ~ 6.

(*3)	Credit grade of corporates are BBB- ~ C, and consumers are grades 7 ~ 10.

(*4)	Financial assets at FVTOCI has been disclosed as the amount before deducting loss allowance because loss allowance does not reduce the carrying amount.

- 28 -

Guarantees and commitments

The credit quality of the guarantees and loan commitments as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020
Financial assets	Stage 1				Stage 2				Stage 3		Total
Financial assets	Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Stage 3		Total
Off-balance accounts:
Guarantees		11,066,524		1,374,335		10,357		220,968		117,129		12,789,313
Loan Commitments		101,117,856		3,365,611		1,479,511		1,017,266		6,770		106,987,014

Total		112,184,380		4,739,946		1,489,868		1,238,234		123,899		119,776,327

(*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, 2019
Financial assets	Stage 1				Stage 2				Stage 3		Total
Financial assets	Above appropriate credit rating (*1)		Less than a limited credit rating (*3)		Above appropriate credit rating (*2)		Less than a limited credit rating (*3)		Stage 3		Total
Off-balance accounts
Guarantees		10,952,917		1,333,561		355		223,657		108,427		12,618,917
Loan Commitments		97,854,790		3,479,295		1,388,136		906,033		23,420		103,651,674

Total		108,807,707		4,812,856		1,388,491		1,129,690		131,847		116,270,591

(*1)	Credit grade of corporates are AAA ~ BBB, and consumers are grades 1 ~ 6.

(*2)	Credit grade of corporates are A- ~ BBB, and consumers are grades 1 ~ 6.

(*3)	Credit grade of corporate are BBB- ~ C, and consumers are grades 7 ~ 10.

Collateral and other credit enhancements

For the six-month period ended June 30, 2020 and for the year ended December 31, 2019, 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. As of June 30, 2020, there are no financial assets that do not recognize the allowance for losses just because financial assets have collateral.

- 29 -

(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.

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.

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 Group for the six-month period June 30, 2020 and for the year ended December 31, 2019, and the VaR of the Group as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020			For the six-month period ended June 30, 2020									December 31, 2019			For the year ended December 31, 2019
Risk factor	June 30, 2020			Average			Maximum			Minimum			December 31, 2019			Average			Maximum			Minimum
Interest rate		7,698			6,220			11,787			2,427			5,052			3,406			5,725			1,176
Stock price		9,331			6,719			14,394			2,580			3,730			3,203			5,935			1,146
Foreign currencies		10,498			7,577			10,498			4,613			5,028			5,033			6,469			4,395
Commodity price		—			—			—			—			—			1			32			—
Diversification		(10,506	)		(8,847	)		(14,782	)		(4,050	)		(6,233	)		(5,127	)		(9,229	)		(2,339	)

Total VaR(*)		17,021			11,669			21,897			5,570			7,577			6,516			8,932			4,378

(*)	VaR (Value at Risk): Retention period of 1 day, Maximum expected losses under 99% level of confidence.

- 30 -

Non-trading activities

For non-trading sectors of the bank, consolidated trusts and subsidiaries of the Bank, the risk is managed and measured by DNII(Change in Net Interest Income) and DEVE(Change in Economic Value of Equity) simulated by NII (Net Interest Income) and EVE (Economic Value of Equity).

NII is primarily an indicator of changes in profit from short-term changes in interest rates and is measured by deducting the interest expenses on the liability from the interest income from the asset. NPV is primarily an indicator of the risk of an economic value perspective resulting from unfavorable changes in interest rates and is measured by subtracting the present value of the liability from the present value of the asset.

DNII represents a change in net interest income that may occur over a certain period (e.g., 1 year) due to unfavorable changes in interest rates, 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. The interest rate EaR represents the maximum amount of decrease in net interest income that could result from unfavorable changes in interest rate over a certain period (e.g., 1 year), and the interest rate VaR represents the maximum expected loss that indicates how much net asset value can decrease at present or in the future due to unfavorable changes in interest rates.

For assets and liabilities as of June 30, 2020 and December 31, 2019 that include bank, consolidated trusts and subsidiaries of the bank, details of DEVE and DNII calculated based on interest rate risk in banking book (IRRBB) are as follows (Unit: Korean Won in millions):

(*1)	DEVE: change in Economic Value of Equity

(*2)	DNII: change in Net Interest Income

For the remaining subsidiaries except the bank, consolidated trusts, and consolidated subsidiaries of the bank as of June 30, 2020 and December 31, 2019, the interest rate EaR and VaR calculated based on the BIS Framework are as follows (Unit: Korean Won in millions):


June 30, 2020		December 31, 2019
EaR (*1)	VaR (*2)	EaR (*1)	VaR (*2)
65,469	151,261	92,439	87,872

(*1)	EaR (Earning at Risk): Change of Maximum expected income and expense

(*2)	VaR (Value at Risk): Maximum expected losses

- 31 -

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, 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		158,793,844		48,168,334		15,484,544		14,977,654		59,563,802		5,843,335		302,831,513
Financial assets at FVTPL		239,952		47,799		12,192		96,088		166,679		13,293		576,003
Financial assets at FVTOCI		5,205,346		3,863,456		3,031,647		3,342,430		13,319,160		573,435		29,335,474
Securities at amortized cost		805,526		1,405,340		1,197,336		1,423,161		13,626,111		1,034,100		19,491,574

Total		165,044,668		53,484,929		19,725,719		19,839,333		86,675,752		7,464,163		352,234,564

Liability:
Deposits due to customers		122,545,248		47,711,593		35,251,985		23,508,278		47,846,875		61,590		276,925,569
Borrowings		11,951,066		3,141,297		1,352,582		812,867		3,836,500		486,695		21,581,007
Debentures		3,393,589		2,462,773		2,443,652		2,561,024		18,614,699		3,355,062		32,830,799

Total		137,889,903		53,315,663		39,048,219		26,882,169		70,298,074		3,903,347		331,337,375


	December 31, 2019
	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		153,023,603		49,505,606		12,505,250		10,506,470		57,582,270		5,209,670		288,332,869
Financial assets at FVTPL		150,149		23,648		63,825		34,299		131,206		13,347		416,474
Financial assets at FVTOCI		5,414,586		5,486,113		3,450,669		3,174,893		9,367,756		318,371		27,212,388
Securities at amortized cost		1,844,868		1,696,004		738,383		1,409,549		14,869,227		858,142		21,416,173

Total		160,433,206		56,711,371		16,758,127		15,125,211		81,950,459		6,399,530		337,377,904

Liability:
Deposits due to customers		116,490,812		45,803,202		32,683,132		26,740,013		43,175,232		59,305		264,951,696
Borrowings		12,105,234		1,910,759		1,048,991		706,952		3,264,861		509,359		19,546,156
Debentures		2,378,211		2,894,577		3,330,658		2,466,142		19,211,409		2,537,391		32,818,388

Total		130,974,257		50,608,538		37,062,781		29,913,107		65,651,502		3,106,055		317,316,240

- 32 -

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.

Financial instruments in foreign currencies exposed to currency risk as of June 30, 2020 and December 31, 2019 are as follows (Unit: USD in millions, JPY in millions, CNY in millions, EUR in millions, and Korean Won in millions):


		June 30, 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	Loans and other financial assets at amortized cost (*)		28,161		33,813,226		115,410		1,288,030		30,939		5,249,050		1,993		2,690,882		5,174,443		48,215,631
	Financial assets at FVTPL		241		289,820		12,335		137,660		27		4,716		214		289,169		128,515		849,880
	Financial assets at FVTOCI		3,112		3,736,603		—		—		2,156		365,728		37		50,398		520,089		4,672,818
	Securities at amortized cost		258		310,188		—		—		—		—		34		45,712		126,288		482,188

Total			31,772		38,149,837		127,745		1,425,690		33,122		5,619,494		2,278		3,076,161		5,949,335		54,220,517

Liability	Financial liabilities at FVTPL		488		585,483		11,006		122,830		—		—		276		372,654		201,733		1,282,700
	Deposits due to customers		16,323		19,598,984		184,525		2,059,393		27,204		4,615,457		1,462		1,974,355		3,236,127		31,484,316
	Borrowings		6,521		7,829,616		3,950		44,079		—		—		548		739,706		1,463,208		10,076,609
	Debentures		4,359		5,233,777		—		—		—		—		—		—		255,888		5,489,665
	Other financial liabilities		4,171		5,008,649		4,404		49,147		2,162		366,875		120		162,480		191,803		5,778,954

Total			31,862		38,256,509		203,885		2,275,449		29,366		4,982,332		2,406		3,249,195		5,348,759		54,112,244

Off-balance accounts			7,166		8,603,941		31,341		349,787		4,017		681,581		538		725,804		524,025		10,885,138

(*)	Includes cash and cash equivalents.

- 33 -


		December 31, 2019
		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	Loans and other financial assets at amortized cost (*)		22,916		26,531,794		150,462		1,600,140		31,393		5,203,131		2,258		2,929,312		5,272,352		41,536,729
	Financial assets at FVTPL		165		190,733		5,322		56,602		25		4,155		105		135,827		64,185		451,502
	Financial assets at FVTOCI		2,679		3,102,752		—		—		2,005		332,319		25		33,017		406,753		3,874,841
	Securities at amortized cost		319		369,677		—		—		—		—		40		52,139		97,092		518,908

Total			26,079		30,194,956		155,784		1,656,742		33,423		5,539,605		2,428		3,150,295		5,840,382		46,381,980

Liability	Financial liabilities at FVTPL		251		291,102		4,415		46,957		—		—		68		87,776		83,790		509,625
	Deposits due to customers		13,208		15,291,671		166,108		1,766,526		27,739		4,597,467		1,727		2,240,884		3,247,164		27,143,712
	Borrowings		6,588		7,627,665		11,061		117,634		16		2,743		515		668,060		499,046		8,915,148
	Debentures		3,999		4,629,944		—		—		—		—		105		136,230		271,790		5,037,964
	Other financial liabilities		3,016		3,492,462		11,240		119,529		3,079		510,281		359		466,240		6,906		4,595,418

Total			27,062		31,332,844		192,824		2,050,646		30,834		5,110,491		2,774		3,599,190		4,108,696		46,201,867

Off-balance accounts			7,030		8,139,395		34,316		364,946		4,525		749,973		560		726,323		634,870		10,615,507

(*)	Includes cash and cash equivalents.

- 34 -

(3)	Liquidity risk

Liquidity risk refers to the risk that the Group may encounter difficulties in meeting obligations from its financial liabilities.

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.

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, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 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		30,021		—		21,571		2,468		448		—		54,508
Deposits due to customers		174,451,640		36,933,721		26,898,235		29,765,914		9,220,888		1,879,658		279,150,056
Borrowings		9,927,257		3,317,550		2,403,875		1,313,598		4,135,475		498,702		21,596,457
Debentures		3,393,589		2,462,773		2,443,652		2,561,024		18,614,699		3,355,062		32,830,799
Lease liabilities		46,310		47,222		42,714		35,438		227,812		34,208		433,704
Other financial liabilities		13,485,838		60,845		5,788		5,080		145,383		2,167,180		15,870,114

Total		201,334,655		42,822,111		31,815,835		33,683,522		32,344,705		7,934,810		349,935,638


	December 31, 2019
	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		115,156		—		—		—		—		—		115,156
Deposits due to customers		166,474,535		36,697,168		24,634,859		31,233,844		6,590,119		1,877,594		267,508,119
Borrowings		8,596,202		2,948,384		2,162,846		1,880,424		3,682,214		520,936		19,791,006
Debentures		2,378,211		2,894,577		3,330,658		2,466,142		19,211,409		2,537,391		32,818,388
Lease liabilities		46,072		42,549		37,420		35,210		232,985		40,698		434,934
Other financial liabilities		11,242,367		60,981		119,633		10,344		71,561		2,660,640		14,165,526

Total		188,852,543		42,643,659		30,285,416		35,625,964		29,788,288		7,637,259		334,833,129

- 35 -

b) Cash flows of principals and interests by expected maturities of non-derivative financial liabilities as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 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		54,508		—		—		—		—		—		54,508
Deposits due to customers		182,923,739		39,210,484		25,006,334		23,401,668		7,959,980		156,763		278,658,968
Borrowings		9,927,257		3,317,550		2,403,875		1,313,598		4,135,475		498,702		21,596,457
Debentures		3,393,589		2,462,773		2,443,652		2,561,024		18,614,699		3,355,062		32,830,799
Lease liabilities		46,310		47,222		42,714		35,438		227,812		34,208		433,704
Other financial liabilities		13,485,838		60,845		5,788		5,080		145,383		2,167,180		15,870,114

Total		209,831,241		45,098,874		29,902,363		27,316,808		31,083,349		6,211,915		349,444,550


	December 31, 2019
	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		115,156		—		—		—		—		—		115,156
Deposits due to customers		175,309,271		38,219,793		23,649,424		24,102,750		5,547,232		150,233		266,978,703
Borrowings		8,596,202		2,948,384		2,162,846		1,880,424		3,682,214		520,936		19,791,006
Debentures		2,378,211		2,894,577		3,330,658		2,466,142		19,211,409		2,537,391		32,818,388
Lease liabilities		46,072		42,549		37,420		35,210		232,985		40,698		434,934
Other financial liabilities		11,242,367		60,981		119,633		10,344		71,561		2,660,640		14,165,526

Total		197,687,279		44,166,284		29,299,981		28,494,870		28,745,401		5,909,898		334,303,713

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, 2020 and December 31, 2019 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, 2020	Cash flow risk hedge		184		487			593			387			9,250		268		11,169
	Trading purpose		3,976,722		—			—			—			—		—		3,976,722
December 31, 2019	Cash flow risk hedge		1,839		(341	)		(298	)		(247	)		6,249		—		7,202
	Trading purpose		2,843,195		—			—			—			—		—		2,843,195

- 36 -

Maturity analysis of off-balance accounts (Guarantees and loan commitments)

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. Under a loan commitment, the Group agrees to make funds available to a customer in the future. 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, 2020		December 31, 2019
Guarantees		12,789,313		12,618,917
Loan commitments		106,987,014		103,651,674
Other commitments		5,057,141		3,411,334

(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.

Operational risk management

The Group has been running the operational risk management system under Basel II. The Group developed Advanced Measurement Approaches (“AMA”) to quantify required capital for operational risk. This system is used for reinforcement in foreign competitions, reducing the amount of risk capitals, managing the risk, and precaution for any unexpected occasions. This system has been tested by an independent third party and approved by the Financial Supervisory Service.

Operational risk measurement

To quantify required capital for operational risk, the Group applies AMA using internal and external loss data, business environment and internal control factors, and scenario analysis. For the operational risk management for its subsidiaries, the Group adopted the Basic Indicator Approach.

- 37 -

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. With the establishment of Woori Financial Group Inc. during the current term, the company reports to the CODM according to the organizational sectors below. 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, comprehensive finance 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 and relevant services for Woori Bank and overseas subsidiaries’ customers
Credit card		Credit card, cash services, card loans and relevant work of Woori Card Co., Ltd.
Investment banking		Securities operation, sale of financial instruments, project financing and other related activities for comprehensive financing of Woori Investment bank Co., Ltd.
Others		Woori Financial Group Inc., Woori FIS Co., Ltd., Woori Finance Research Institute, Woori Credit Information Co., Ltd., Woori Fund Services Inc., Woori Asset Trust Co., Ltd., Woori Asset Management Corp., Ltd., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd.

(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, 2020
	Banking			Credit card			Investment banking			Others (*1)			Sub-total			Adjustments (*2)			Total
Net Interest income(expense)		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 income(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

(*1)

Other segments include gains and losses from Woori Financial Group Inc., Woori FIS Co., Ltd., Woori Finance Research Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Service Inc., Woori Asset Trust Co., Ltd., Woori Asset Management Corp., Woori Private Equity Asset Management Co., Ltd. and Woori Global Asset Management Co., Ltd.

(*2)	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.

- 38 -


	For the six-month period ended June 30, 2019
	Banking			Credit card			Investment banking			Others (*1)			Sub-total			Adjustments (*2)			Total
Net Interest income(expense)		2,303,318			267,948			23,516			517			2,595,299			335,753			2,931,052
Non-interest income(expense)		824,249			20,343			15,083			806,380			1,666,055			(1,054,363	)		611,692
Impairment losses due to credit loss		69,858			(126,351	)		(1,046	)		1			(57,538	)		(79,008	)		(136,546	)
General and administrative expense		(1,562,939	)		(91,177	)		(11,635	)		(161,162	)		(1,826,913	)		131,127			(1,695,786	)
Net operating income(expense)		1,634,486			70,763			25,918			645,736			2,376,903			(666,491	)		1,710,412

Non-operating income(expense)		(17,269	)		16,728			(1,021	)		(994	)		(2,556	)		20,226			17,670

Net income(expense) before tax		1,617,217			87,491			24,897			644,742			2,374,347			(646,265	)		1,728,082
Tax income(expense)		(433,671	)		(20,991	)		(2,574	)		(949	)		(458,185	)		2,066			(456,119	)

Net income(loss)		1,183,546			66,500			22,323			643,793			1,916,162			(644,199	)		1,271,963

(*1)	Other segments include gains and losses from Woori Financial Group Inc., Woori FIS Co., Ltd., Woori Finance Research Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Service Inc. and Woori Private Equity Asset Management Co., Ltd.

(*2)	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.

(3)	Operating profit or loss from external customers for the six-month period ended June 30, 2020 and 2019 are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020		For the six-month period ended June 30, 2019
Domestic		1,108,347		1,544,248
Foreign		64,251		166,164

Total		1,172,598		1,710,412

(4)	Major non-current assets as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020 (*)		December 31, 2019 (*)
Domestic		4,880,409		4,908,140
Foreign		491,947		387,284

Total		5,372,356		5,295,424

(*)	Major non-current assets included joint ventures and related business investments, 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 period ended June 30, 2020 and 2019.

- 39 -

6.	STATEMENTS OF CASH FLOWS

(1)	Details of cash and cash equivalents are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Cash		1,813,004		1,957,997
Foreign currencies		600,051		625,999
Demand deposits		6,593,103		3,684,044
Fixed deposits		431,461		124,526

Total		9,437,619		6,392,566

(2)	Significant transactions of investing activities and financing activities not involving cash inflows and outflows are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30
	2020			2019
Changes in other comprehensive income related to valuation of financial assets at FVTOCI		(25,751	)		6,560
Changes in other comprehensive income related to valuation of equity method investments		(4,621	)		(418	)
Changes in other comprehensive income related to valuation profit or loss on cash flow hedge		(10,030	)		(1,170	)
Changes in financial assets measure at FVTOCI due to debt-for-equity swap		3,629			94,710
Changes in the investment assets of associates due to the replacement of the account		6,141			—
Changes in financial assets at FVTPL and assets held for sale		(2,385	)		119
Transfer of investment properties and premises and equipment		(31,681	)		172,891
Changes in account payables related to intangible assets		(10,157	)		32,689
Changes in right-of-use assets and lease liabilities		111,466			572,851
Changes in unpaid dividends on hybrid equity securities		—			231

- 40 -

7.	FINANCIAL ASSETS AT FVTPL

(1)	Details of financial assets at FVTPL as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Financial assets at fair value through profit or loss mandatorily measured at fair value		10,067,062		8,069,144

(2)	Financial assets at fair value through profit or loss mandatorily measured at fair value are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Deposits:
Gold banking asset		29,631		27,901
Securities:
Debt securities
Korean treasury and government agencies		975,677		872,954
Financial institutions		573,758		600,303
Corporates		887,425		762,265
Others		70,793		101,563
Equity securities		553,995		688,350
Capital contributions		614,036		515,199
Beneficiary certificates		1,766,848		1,366,233

Sub-total		5,442,532		4,906,867

Loans		328,602		212,473
Derivatives assets		4,266,297		2,921,903

Total		10,067,062		8,069,144

The Group does not have financial assets at fair value through profit or loss designated as upon initial recognition as of June 30, 2020 and December 31, 2019.

8.	FINANCIAL ASSETS AT FVTOCI

(1)

Details of financial assets at FVTOCI as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Debt securities:
Korean treasury and government agencies		1,792,875		1,152,711
Financial institutions		18,497,960		17,769,924
Corporates		3,791,148		3,917,004
Bond denominated in foreign currencies		4,672,762		3,874,785
Securities loaned		50,064		80,737

Sub-total		28,804,809		26,795,161

Equity securities		807,599		935,370

Total		29,612,408		27,730,531

- 41 -

(2)

Details of equity securities designated as financial assets at FVTOCI as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


Purpose of acquisition	June 30, 2020		December 31, 2019		Remarks
Investment for strategic business partnership purpose		564,425		678,846
Debt-equity swap		243,130		256,480
Others		44		44		Cooperative insurance, etc.

Total		807,599		935,370

(3)

Changes in the loss allowance and gross carrying amount of financial assets at FVTOCI are as follows (Unit: Korean Won in millions):

Allowance for credit losses


	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 loss allowance		(782	)		—		—		(782	)
Disposal		337			—		—		337
Others (*)		(170	)		—		—		(170	)

Ending balance		(9,184	)		—		—		(9,184	)

(*)	Others consist of foreign currencies translation, etc.


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2			Stage 3		Total
Beginning balance		(5,939	)		(238	)		—		(6,177	)
Transfer to 12-month expected credit losses		—			—			—		—
Transfer to lifetime expected credit losses		62			(62	)		—		—
Transfer to credit-impaired financial assets		—			—			—		—
Net provision (reversal) of loss allowance		(2,214	)		235			—		(1,979	)
Disposal		117			—			—		117
Others (*)		167			—			—		167

Ending balance		(7,807	)		(65	)		—		(7,872	)

(*)	Others consist of foreign currencies translation, etc.

Gross carrying amount


	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/Redemption		(11,051,251	)		—		—		(11,051,251	)
Gain (loss) 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.

- 42 -


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2			Stage 3		Total
Beginning balance		17,087,096			25,153			—		17,112,249
Transfer to 12-month expected credit losses		10,043			(10,043	)		—		—
Transfer to lifetime expected credit losses		(5,116	)		5,116			—		—
Transfer to credit-impaired financial assets		—			—			—		—
Acquisition		12,508,275			—			—		12,508,275
Disposal/Redemption		(5,090,732	)		(10,088	)		—		(5,100,820	)
Gain (loss) on valuation		66,013			(112	)		—		65,901
Amortization based on effective interest method		9,960			—			—		9,960
Others (*)		81,543			—			—		81,543

Ending balance		24,667,082			10,026			—		24,677,108

(*)	Changes due to foreign currencies translation, etc.

(4)

During the six-month period ended June 30, 2020 and 2019, 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 52 million Won and 27,984 million Won, respectively and cumulative losses at disposal dates were 48 million Won and 36,500 million Won, respectively.

9.	SECURITIES AT AMORTIZED COST

(1)

Details of securities at amortized cost as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Korean treasury and government agencies		7,118,115			8,044,040
Financial institutions		5,714,972			6,694,614
Corporates		5,300,884			5,068,489
Bond denominated in foreign currencies		482,188			518,907
Allowance for credit losses		(5,557	)		(5,511	)

Total		18,610,602			20,320,539

(2)

Changes in the loss allowance and gross carrying amount of securities at amortized cost are as follows (Unit: Korean Won in millions):

Loss allowance


	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 loss allowance		(47	)		—		—		(47	)
Others (*)		1			—		—		1

Ending balance		(5,557	)		—		—		(5,557	)

(*)	Changes due to foreign currencies translation, etc.

- 43 -


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2		Stage 3		Total
Beginning balance		(6,924	)		—		—		(6,924	)
Transfer to 12-month expected credit losses		—			—		—		—
Transfer to lifetime expected credit losses		—			—		—		—
Transfer to credit-impaired financial assets		—			—		—		—
Net reversal of loss allowance		768			—		—		768
Others (*)		(5	)		—		—		(5	)

Ending balance		(6,161	)		—		—		(6,161	)

(*)	Changes due to foreign currencies translation, etc.

Gross carrying amount


	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 / Redemption		(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.


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2		Stage 3		Total
Beginning balance		22,939,484			—		—		22,939,484
Transfer to 12-month expected credit losses		—			—		—		—
Transfer to lifetime expected credit losses		—			—		—		—
Transfer to credit-impaired financial assets		—			—		—		—
Acquisition		2,353,102			—		—		2,353,102
Disposal / Redemption		(4,803,559	)		—		—		(4,803,559	)
Amortization based on effective interest method		1,184			—		—		1,184
Others (*)		9,397			—		—		9,397

Ending balance		20,499,608			—		—		20,499,608

(*)	Changes due to foreign currencies translation, etc.

- 44 -

10.

LOANS AND OTHER FINANCIAL ASSETS AT AMORTIZED COST

(1)	Details of loans and other financial assets at amortized cost as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Due from banks		12,947,209		14,492,223
Loans		280,972,081		271,032,244
Other financial assets		12,498,779		8,193,226

Total		306,418,069		293,717,693

(2)	Details of due from banks are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Due from banks in local currency:
Due from The Bank of Korea (“BOK”)		9,178,893			11,028,850
Due from depository banks		63,409			82,509
Due from non-depository institutions		3,247			378
Due from the Korea Exchange		81			50,113
Others		46,522			43,253
Loss allowance		(2,188	)		(2,865	)

Sub-total		9,289,964			11,202,238

Due from banks in foreign currencies:
Due from banks on demand		1,394,988			1,122,521
Due from banks on time		676,128			1,296,842
Others		1,590,003			872,617
Loss allowance		(3,874	)		(1,995	)

Sub-total		3,657,245			3,289,985

Total		12,947,209			14,492,223

- 45 -

(3)	Details of restricted due from banks are as follows (Unit: Korean Won in millions):


	Counterparty	June 30, 2020		Reason of restriction
Due from banks in local currencies:
Due from BOK	The BOK		9,178,893	Reserve deposits under the BOK Act
Due from KSFC	KB Securities Co. Ltd.		81	Futures trading margin
Others	The Korea Exchange and others		44,863	Central counterparty KRW margin and others

Sub-total			9,223,837

Due from banks in foreign currencies:
Due from banks on demand	The BOK and others		1,387,278	Reserve deposits under the BOK Act and others
Foreign currency deposits on time	National Bank Cambodia		60	Reserve deposits and others
Others	Korea Investment & Securities and others		1,590,002	Overseas futures and options trade deposits and others

Sub-total			2,977,340

Total			12,201,177


	Counterparty	December 31, 2019		Reason of restriction
Due from banks in local currencies:
Due from BOK	The BOK		11,028,850	Reserve deposits under the BOK Act
Due from KSFC	Korea Securities Finance Corp. and others		50,113	Customer’s deposit reserve
Others	The Korea Exchange and others		41,645	Central counterparty KRW margin and others

Sub-total			11,120,608

Due from banks in foreign currencies:
Due from banks on demand	The BOK and others		1,103,917	Reserve deposits under the BOK Act and others
Foreign currency deposits on time	National Bank Cambodia		58	Reserve deposits and others
Others	Korea Investment & Securities and others		872,603	Overseas futures and options trade deposits and others

Sub-total			1,976,578

Total			13,097,186

- 46 -

(4)	Changes in the loss allowance and gross carrying amount of due from banks are as follows (Unit: Korean Won in millions):

Allowance for credit losses


	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		—			—		—		—
Net provision of loss allowance		(1,305	)		—		—		(1,305	)
Others (*)		103			—		—		103

Ending balance		(6,062	)		—		—		(6,062	)

(*)	Changes due to foreign currencies translation, etc.


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2		Stage 3		Total
Beginning balance		(5,387	)		—		—		(5,387	)
Transfer to 12-month expected credit losses		—			—		—		—
Transfer to lifetime expected credit losses		—			—		—		—
Transfer to credit-impaired financial assets		—			—		—		—
Net provision of loss allowance		(708	)		—		—		(708	)
Others (*)		(27	)		—		—		(27	)

Ending balance		(6,122	)		—		—		(6,122	)

(*)	Changes due to foreign currencies translation, etc.

Gross carrying amount


	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 increase (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.


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2		Stage 3		Total
Beginning balance		14,156,399			—		—		14,156,399
Transfer to 12-month expected credit losses		—			—		—		—
Transfer to lifetime expected credit losses		—			—		—		—
Transfer to credit-impaired financial assets		—			—		—		—
Net increase (decrease)		(2,856,414	)		—		—		(2,856,414	)
Others (*)		72,930			—		—		72,930

Ending balance		11,372,915			—		—		11,372,915

(*)	Changes due to foreign currencies translation, etc.

- 47 -

(5)	Details of loans are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Loans in local currency		231,766,891			221,484,049
Loans in foreign currencies		19,911,198			18,534,270
Domestic banker’s usance		2,751,815			2,899,651
Credit card accounts		7,875,508			8,398,605
Bills bought in foreign currencies		4,862,524			4,772,093
Bills bought in local currency		169,528			61,362
Factoring receivables		37,493			20,905
Advances for customers on guarantees		13,693			12,616
Private placement bonds		246,251			307,339
Securitized loans		2,123,577			2,250,042
Call loans		2,655,435			3,290,167
Bonds purchased under resale agreements		8,358,028			8,981,752
Others		1,263,343			980,448
Loan origination costs and fees		635,360			620,791
Discounted present value		(4,751	)		(6,826	)
Allowance for credit losses		(1,693,812	)		(1,575,020	)

Total		280,972,081			271,032,244

- 48 -

(6)	Changes in the loss allowance of loans are as follows (Unit: Korean Won in millions):


	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 loss allowance		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 loss allowance		(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	)


	For the six-month period ended June 30, 2019
	Consumers									Corporates
	Stage 1			Stage 2			Stage 3			Stage 1			Stage 2			Stage 3
Beginning balance		(114,509	)		(48,368	)		(129,906	)		(348,311	)		(349,619	)		(527,673	)
Transfer to 12-month expected credit losses		(9,605	)		8,953			652			(51,272	)		42,198			9,074
Transfer to lifetime expected credit losses		5,742			(7,568	)		1,826			13,759			(15,607	)		1,848
Transfer to credit-impaired financial assets		1,955			10,039			(11,994	)		2,454			17,764			(20,218	)
Net reversal (provision) of loss allowance		1,344			(10,896	)		(74,447	)		17,220			10,863			54,799
Recovery		—			—			(34,635	)		—			—			(32,585	)
Charge-off		—			—			105,473			—			—			92,575
Disposal		—			—			1,191			—			—			20,019
Interest income from impaired loans		—			—			4,743			—			—			9,341
Others		(302	)		(27	)		(415	)		1,352			(187	)		(525	)

Ending balance		(115,375	)		(47,867	)		(137,512	)		(364,798	)		(294,588	)		(393,345	)


	For the six-month period ended June 30, 2019
	Credit card accounts									Total
	Stage 1			Stage 2			Stage 3			Stage 1			Stage 2			Stage 3
Beginning balance		(64,787	)		(78,131	)		(116,772	)		(527,607	)		(476,118	)		(774,351	)
Transfer to 12-month expected credit losses		(15,296	)		15,262			34			(76,173	)		66,413			9,760
Transfer to lifetime expected credit losses		7,269			(7,557	)		288			26,770			(30,732	)		3,962
Transfer to credit-impaired financial assets		15,055			59,063			(74,118	)		19,464			86,866			(106,330	)
Net reversal (provision) of loss allowance		(10,462	)		(61,468	)		(45,786	)		8,102			(61,501	)		(65,434	)
Recovery		—			—			(29,035	)		—			—			(96,255	)
Charge-off		—			—			138,944			—			—			336,992
Disposal		—			—			—			—			—			21,210
Interest income from impaired loans		—			—			—			—			—			14,084
Others		(1	)		1			(2	)		1,049			(213	)		(942	)

Ending balance		(68,222	)		(72,830	)		(126,447	)		(548,395	)		(415,285	)		(657,304	)

- 49 -

(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, 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


	For the six-month period ended June 30, 2019
	Consumers									Corporates
	Stage 1			Stage 2			Stage 3			Stage 1			Stage 2			Stage 3
Beginning balance		110,619,242			6,028,009			391,494			131,453,727			5,031,258			1,020,658
Transfer to 12-month expected credit losses		1,866,758			(1,859,811	)		(6,947	)		1,513,913			(1,483,846	)		(30,067	)
Transfer to lifetime expected credit losses		(2,833,438	)		2,854,387			(20,949	)		(1,984,611	)		1,993,221			(8,610	)
Transfer to credit-impaired financial assets		(91,588	)		(114,797	)		206,385			(187,112	)		(167,681	)		354,793
Charge-off		—			—			(105,473	)		—			—			(92,575	)
Disposal		—			(29	)		(31,916	)		—			—			(79,296	)
Net increase (decrease)		4,013,693			(665,771	)		(22,332	)		5,402,273			(489,901	)		(273,450	)

Ending balance		113,574,667			6,241,988			410,262			136,198,190			4,883,051			891,453


	For the six-month period ended June 30, 2019
	Credit card accounts									Total
	Stage 1			Stage 2			Stage 3			Stage 1			Stage 2			Stage 3
Beginning balance		6,861,844			982,772			208,989			248,934,813			12,042,039			1,621,141
Transfer to 12-month expected credit losses		286,975			(286,924	)		(51	)		3,667,646			(3,630,581	)		(37,065	)
Transfer to lifetime expected credit losses		(336,040	)		336,410			(370	)		(5,154,089	)		5,184,018			(29,929	)
Transfer to credit-impaired financial assets		(48,082	)		(80,178	)		128,260			(326,782	)		(362,656	)		689,438
Charge-off		—			—			(138,944	)		—			—			(336,992	)
Disposal		—			—			—			—			(29	)		(111,212	)
Net increase (decrease)		99,345			(15,877	)		25,258			9,515,311			(1,171,549	)		(270,524	)

Ending balance		6,864,042			936,203			223,142			256,636,899			12,061,242			1,524,857

(8)	Details of other financial assets are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
CMA accounts		163,000			199,000
Receivables		10,219,710			5,653,997
Accrued income		911,420			1,012,240
Telex and telephone subscription rights and refundable deposits		942,486			949,118
Other assets		342,332			456,010
Allowance for credit losses		(80,169	)		(77,139	)

Total		12,498,779			8,193,226

- 50 -

(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, 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	)		—
Net provision of loss allowance		(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	)


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2			Stage 3			Total
Beginning balance		(3,469	)		(1,971	)		(62,501	)		(67,941	)
Transfer to 12-month expected credit losses		(122	)		116			6			—
Transfer to lifetime expected credit losses		79			(93	)		14			—
Transfer to credit-impaired financial assets		18			227			(245	)		—
Net provision of loss allowance		(99	)		(243	)		(2,706	)		(3,048	)
Charge-off		—			—			151			151
Disposal		—			—			381			381
Others		(72	)		117			854			899

Ending balance		(3,665	)		(1,847	)		(64,046	)		(69,558	)

(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, 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


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2			Stage 3			Total
Beginning balance		7,454,390			28,193			72,007			7,554,590
Transfer to 12-month expected credit losses		5,247			(5,236	)		(11	)		—
Transfer to lifetime expected credit losses		(6,111	)		6,151			(40	)		—
Transfer to credit-impaired financial assets		(474	)		(1,653	)		2,127			—
Charge-off		—			—			(151	)		(151	)
Disposal		—			—			(581	)		(581	)
Net increase (decrease)		7,148,221			3,462			(584	)		7,151,099

Ending balance		14,601,273			30,917			72,767			14,704,957

- 51 -

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.

- 52 -

(2)	Fair value hierarchy of financial assets and liabilities measured at fair value are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Level 1 (*)		Level 2 (*)		Level 3		Total
Financial assets:
Financial assets at FVTPL
Deposits		29,631		—		—		29,631
Debt securities		448,552		2,053,336		5,765		2,507,653
Equity securities		15,365		—		538,630		553,995
Capital contributions		—		300		613,736		614,036
Beneficiary certificates		10,303		288,122		1,468,423		1,766,848
Loans		—		139,704		188,898		328,602
Derivative assets (Designated for trading)		32,778		4,130,088		103,431		4,266,297

Sub-total		536,629		6,611,550		2,918,883		10,067,062

Financial assets at FVTOCI
Debt securities		2,733,044		26,071,765		—		28,804,809
Equity securities		365,234		—		442,365		807,599

Sub-total		3,098,278		26,071,765		442,365		29,612,408

Derivative assets (Designated for hedging)		—		249,880		—		249,880

Total		3,634,907		32,933,195		3,361,248		39,929,350

Financial liabilities:
Financial liabilities at FVTPL
Deposits due to customers		30,022		—		—		30,022
Derivative liabilities (Designated for trading)		2,240		3,955,066		19,421		3,976,727

Sub-total		32,262		3,955,066		19,421		4,006,749

Financial liabilities at FVTPL designated as upon initial recognition
Equity-linked securities		—		—		24,486		24,486

Derivative liabilities (Designated for hedging)		—		15,022		—		15,022

Total		32,262		3,970,088		43,907		4,046,257

(*)	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.

- 53 -


	December 31, 2019
	Level 1 (*)		Level 2 (*)		Level 3		Total
Financial assets:
Financial assets at FVTPL
Deposits		27,901		—		—		27,901
Debt securities		420,330		1,910,929		5,826		2,337,085
Equity securities		157,895		1,834		528,621		688,350
Capital contributions		—		—		515,199		515,199
Beneficiary certificates		1		90,498		1,275,734		1,366,233
Loans		—		59,844		152,629		212,473
Derivative assets (Designated for trading)		3,057		2,893,798		25,048		2,921,903

Sub-total		609,184		4,956,903		2,503,057		8,069,144

Financial assets at FVTOCI
Debt securities		2,146,163		24,568,261		—		26,714,424
Equity securities		441,672		—		493,698		935,370
Securities loaned		—		80,737		—		80,737

Sub-total		2,587,835		24,648,998		493,698		27,730,531

Derivative assets (Designated for hedging)		—		121,131		—		121,131

Total		3,197,019		29,727,032		2,996,755		35,920,806

Financial liabilities:
Financial liabilities at FVTPL
Deposits due to customers		27,530		—		—		27,530
Derivative liabilities (Designated for trading)		4,336		2,766,771		72,039		2,843,146

Sub-total		31,866		2,766,771		72,039		2,870,676

Financial liabilities at FVTPL designated as upon initial recognition
Equity-linked securities		—		—		87,626		87,626

Derivative liabilities (Designated for hedging)		—		6,516		321		6,837

Total		31,866		2,773,287		159,986		2,965,139

(*)	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.

- 54 -

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:

Valuation methods and input variables for each type of financial instrument classified into level 2 in June 30, 2020 and December 31, 2019 are as follows:


	Valuation methods	Input variables
Loans	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

Debt securities and Securities loaned	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, credit spread

Beneficiary certificates	The beneficiary certificates classified as Level 2 are measured through Net Asset Value Method.	Value of underlying assets such as bonds

Derivatives	The fair value is measured through option model (Closed Form), DCF Model, FDM, Monte Carlo Simulation, etc.	Risk-free market rate, forward rate, foreign exchange rate, market rate, stock prices and value of underlying assets, volatility, and etc.

Valuation methods and input variables for each type of financial instrument classified into level 3 in June 30, 2020 and December 31, 2019 are as follows:


	Valuation methods	Input variables
Loans	The fair value of Loans is measured by the Binomial tree given the values of underlying assets and volatility.	Values of underlying assets, volatility

Debt securities	The fair value is measured by discounting the projected cash flows of debt securities by applying the market discount rate that has been applied to a proxy company that has similar credit rating to the issuers of the securities.	Risk-free market rate, credit spread, growth rate, etc.

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, and Net Asset Value Method, 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, etc.

Derivatives	Fair value is measured by models such as option model (Closed form), DCF model, FDM and Monte Carlo Simulation.	Risk-free market rate, market rate, values of underlying assets such as foreign exchange rate and stock prices, volatility, etc.

Equity-linked securities	Fair value is measured by models such as option model (Closed form), DCF model, FDM and Monte Carlo Simulation.	Values of underlying assets, market rate, dividend, volatility, correlation coefficient and foreign exchange rate, etc.

- 55 -

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 measurement technique	Type	Input variable	Range	Impact of changes in significant unobservable inputs on fair value measurement

Loans, convertible bonds, bond with options and others	Binomial Tree		Stock, Volatility of underlying asset	29.61%~42.35%	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	28.03%~279.95%	Variation of fair value increases as volatility of underlying assets increases.
		Equity related	Correlation coefficient	0.20~0.71	Variation of fair value increases as correlation coefficient increases.
			Volatility of underlying asset	32.31%~32.57%	Variation of fair value increases as volatility of underlying assets increases.

	DCF model	Currency 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.
		Interest rate related	Volatility of underlying asset	28.03%~279.95%	Variation of fair value increases as volatility of underlying assets increases.
		Equity related	Correlation coefficient	0.20~0.71	Variation of fair value increases as correlation coefficient increases.
		Equity related	Volatility of underlying asset	32.31%~32.57%	Variation of fair value increases as volatility of underlying assets increases.

Equity-linked securities	Monte Carlo Simulation and others	Equity related	Correlation coefficient	0.40~0.50	Fair value of equity-linked securities increases if both historical volatility and correlation coefficient increase. However, when correlation coefficient decreases despite the increase in volatility of underlying asset, the fair value variation of equity-linked securities may decreases.
Equity-linked securities	Monte Carlo Simulation and others	Equity related	Volatility of underlying asset	32.31%~48.13%

- 56 -


	Fair value measurement technique	Type	Input variable	Range	Impact of changes in significant unobservable inputs on fair value measurement

Equity securities, capital contributions, and beneficiary certificates	Binomial Tree		Stock, Volatility of underlying asset	28.18%~38.50%	Variation of fair value increases as volatility of underlying asset increases.

	DCF model and others		Terminal growth rate	0~1%	Fair value increases as terminal growth rate increases.
			Discount rate	4.12%~35.78%	Fair value increases as discount rate decreases.
			Volatility of real estate sale price	—	Fair value increases as real estate sale price increases.
			liquidation value	—	Variation of liquidation value increases as volatility of underlying assets 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, 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)

For financial liabilities, positive numbers represent losses that increase balance and negative numbers represent gains that decrease balance. The interim statements of comprehensive income includes gain of 140,315 million Won included in net gain (loss) on financial assets at FVTPL and net gain (loss) on financial assets at FVTOCI pertaining to the assets and liabilities held by the Group at the end of the period.

(*2)	The Group recognizes transfers between levels at the end of reporting period within which events have occurred or conditions have changed.

- 57 -


	For the six-month period ended June 30, 2019
	January 1, 2019		Net Income (loss) (*1)			Other comprehensive income		Purchases/ issuances			Disposals/ settlements			Transfer to or out of Level 3 (*2)			June 30, 2019
Financial assets:
Financial assets at FVTPL
Debt securities		8,389		8			—		2,000			(302	)		—			10,095
Equity securities		401,860		39,060			—		23,446			(4,304	)		—			460,062
Capital contributions		422,614		(10,446	)		—		72,074			(48,179	)		—			436,063
Beneficiary certificates		854,299		10,854			—		147,759			(128,144	)		1			884,769
Loans		180,450		(1,316	)		—		500			(32,390	)		—			147,244
Derivative assets		48,798		13,483			—		1,726			(35,998	)		(3,626	)		24,383

Sub-total		1,916,410		51,643			—		247,505			(249,317	)		(3,625	)		1,962,616

Financial assets at FVTOCI
Equity securities		468,847		—			6,473		62			(76	)		—			475,306

Total		2,385,257		51,643			6,473		247,567			(249,393	)		(3,625	)		2,437,922

Financial liabilities:
Financial liabilities at FVTPL
Derivative liabilities		16,691		61,459			—		(10,098	)		(10,034	)		(2,728	)		55,290
Financial liabilities at FVTPL designated as upon initial recognition
Equity-linked securities		164,767		26,361			—		1,809			(37,059	)		—			155,878

Total		181,458		87,820			—		(8,289	)		(47,093	)		(2,728	)		211,168

(*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 loss amounting to 38,488 million Won for the six-month period ended June 30, 2019, 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 which events have occurred or conditions have changed.

- 58 -

(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 3,405,155 million Won and 3,156,741 million Won as of June 30, 2020 and December 31, 2019 respectively, equity instruments of 2,533,903 million Won and 2,194,320 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, 2020 and December 31, 2019 is as follows (Unit: Korean Won in millions):


	June 30, 2020
	Net income (loss)					Other comprehensive income (loss)
	Favorable		Unfavorable			Favorable		Unfavorable
Financial assets:
Financial assets at FVTPL
Derivative assets (*1)		5,610		(5,753	)		—		—
Loans (*2)		426		(498	)		—		—
Debt securities		14		(12	)		—		—
Equity securities (2) (3) (*4)		10,246		(7,704	)		—		—
Beneficiary certificates (*4)		1,049		(1,044	)		—		—
Financial assets at FVTOCI		—		—			—		—
Equity securities (3) (4)		—		—			32,678		(24,785	)

Total		17,345		(15,011	)		32,678		(24,785	)

Financial liabilities:
Financial liabilities at FVTPL
Derivative liabilities (*1)		1,307		(348	)		—		—
Financial liabilities at FVTPL designated as upon initial recognition
Equity-linked securities (*1)		108		(101	)		—		—

Total		1,415		(449	)		—		—

(*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 (0~1%) 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%.

- 59 -


	December 31, 2019
	Net income (loss)					Other comprehensive income (loss)
	Favorable		Unfavorable			Favorable		Unfavorable
Financial assets:
Financial assets at FVPL
Derivative assets (*1)		640		(935	)		—		—
Loans (*2)		152		(128	)		—		—
Debt securities		652		(640	)		—		—
Equity securities (3) (4)		16,104		(10,929	)		—		—
Beneficiary certificates (*4)		1,125		(1,125	)		—		—
Financial assets at FVTOCI
Equity securities (3) (4)		—		—			26,380		(11,981	)

Total		18,673		(13,757	)		26,380		(11,981	)

Financial liabilities:
Financial liabilities at FVTPL
Derivative liabilities (*1)		1,054		(816	)		—		—
Financial liabilities at FVTPL designated as upon initial recognition
Equity-linked securities (*1)		136		(142	)		—		—

Total		1,190		(958	)		—		—

(*1)

(*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 (0~1%) and discount rate or liquidation value (-1~1%). The growth rate, discount rate, and liquidation value are major unobservable variables.

(*4)

- 60 -

(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, 2020
	Fair value								Book value
	Level 1		Level 2		Level 3		Total		Book value
Financial assets:
Securities at amortized cost		2,953,540		16,000,595		—		18,954,135		18,610,602
Loans and other financial assets at amortized cost		20,000		—		304,171,889		304,191,889		306,418,069
Financial liabilities:
Deposits due to customers		—		277,435,175		—		277,435,175		276,967,229
Borrowings		—		21,264,706		—		21,264,706		21,263,126
Debentures		—		31,701,489		—		31,701,489		31,029,872
Other financial liabilities		—		18,645,293		161,712		18,807,005		19,209,529



	December 31, 2019
	Fair value								Book value
	Level 1		Level 2		Level 3		Total		Book value
Financial assets:
Securities at amortized cost		3,123,898		17,378,920		—		20,502,818		20,320,539
Loans and other financial assets at amortized cost		25,902		54,507		283,058,699		283,139,108		293,717,693
Financial liabilities:
Deposits due to customers		—		264,909,974		—		264,909,974		264,685,578
Borrowings		—		18,919,018		—		18,919,018		18,998,920
Debentures		—		31,173,189		—		31,173,189		30,858,055
Other financial liabilities		—		17,693,559		—		17,693,559		17,706,767

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

- 61 -

(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, 2020
	Financial asset at FVTPL		Financial assets at FVTOCI		Financial assets at amortized cost		Derivatives assets (Designated for hedging)		Total
Financial assets
Deposits		29,631		—		12,947,209		—		12,976,840
Securities		5,442,532		29,612,408		18,610,602		—		53,665,542
Loans		328,602		—		280,972,081		—		281,300,683
Derivative assets		4,266,297		—		—		249,880		4,516,177
Other financial assets		—		—		12,498,779		—		12,498,779

Total		10,067,062		29,612,408		325,028,671		249,880		364,958,021


	June 30, 2020
	Financial liabilities at FVTPL		Financial liabilities designated at FVTPL		Financial liabilities at amortized cost		Derivatives liabilities (Designated for hedging)		Total
Deposits due to customers		30,022		—		276,967,229		—		276,997,251
Borrowings		—		24,486		21,263,126		—		21,287,612
Debentures		—		—		31,029,872		—		31,029,872
Derivative liabilities		3,976,727		—		—		15,022		3,991,749
Other financial liabilities		—		—		19,209,529		—		19,209,529

Total		4,006,749		24,486		348,469,756		15,022		352,516,013


	December 31, 2019
	Financial asset at FVTPL		Financial assets at FVTOCI		Financial assets at amortized cost		Derivatives assets (Designated for hedging)		Total
Financial assets
Deposits		27,901		—		14,492,223		—		14,520,124
Securities		4,906,867		27,730,531		20,320,539		—		52,957,937
Loans		212,473		—		271,032,244		—		271,244,717
Derivative assets		2,921,903		—		—		121,131		3,043,034
Other financial assets		—		—		8,193,226		—		8,193,226

Total		8,069,144		27,730,531		314,038,232		121,131		349,959,038


	December 31, 2019
	Financial liabilities at FVTPL		Financial liabilities designated at FVTPL		Financial liabilities at amortized cost		Derivatives liabilities (Designated for hedging)		Total
Deposits due to customers		27,530		—		264,685,578		—		264,713,108
Borrowings		—		87,626		18,998,920		—		19,086,546
Debentures		—		—		30,858,055		—		30,858,055
Derivative liabilities		2,843,146		—		—		6,837		2,849,983
Other financial liabilities		—		—		17,769,531		—		17,769,531

Total		2,870,676		87,626		332,312,084		6,837		335,277,223

(*)

Other financial liabilities include 62,764 million Won of financial guarantee liabilities measured at amortized cost included in provisions.

- 62 -

(7)	Income or expense from financial instruments by category

Income or expense from financial assets and liabilities by each category during the six-month period ended June 30, 2020 and 2019 are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020
	Interest Income (expense)			Fees and Commissions Income (expense)		Provision (reversal) of credit loss			Others		Total
Financial assets at FVTPL		26,210			—		—			455,971		482,181
Financial assets at FVTOCI		241,000			102		(782	)		27,647		267,967
Securities at amortized cost		202,060			—		(47	)		—		202,013
Loans and other financial assets at amortized cost		4,446,733			27,476		(422,066	)		32,662		4,084,805
Financial liabilities at amortized cost		(1,969,872	)		—		—			—		(1,969,872	)
Net derivatives (designated for hedging)		—			—		—			14,942		14,942

Total		2,946,131			27,578		(422,895	)		531,222		3,082,036


	For the six-month period ended June 30, 2019
	Interest Income (expense)			Fees and Commissions Income (expense)		Provision (reversal) of credit loss			Others		Total
Financial assets at FVTPL		27,905			54,775		—			127,178		209,858
Financial assets at FVTOCI		209,102			—		(1,979	)		20,930		228,053
Securities at amortized cost		225,195			—		769			—		225,964
Loans and other financial assets at amortized cost		4,815,489			137,106		(122,589	)		94,619		4,924,625
Financial liabilities at FVTPL		(719	)		—		—			—		(719	)
Financial liabilities at amortized cost		(2,345,920	)		—		—			—		(2,345,920	)
Net derivatives (designated for hedging)		—			—		—			26,432		26,432
Off-balance provisions		—			35,040		(12,747	)		—		22,293

Total		2,931,052			226,921		(136,546	)		269,159		3,290,586

- 63 -

12.

DERECOGNITION AND OFFSET OF FINANCIAL INSTRUMENTS

(1)	Derecognition of financial instruments

Transferred financial assets that do not meet the condition of derecognition in their entirety.

Bonds sold under repurchase agreements

The financial instruments that were disposed but the Group agreed to repurchase at the fixed amounts at the same time, so that they did not meet the conditions of derecognition, are as follows (Unit: Korean Won in millions):


		June 30, 2020		December 31, 2019
Assets transferred	Financial assets at FVTPL		464,542		407,985
	Financial assets at FVTOCI		95,278		56,975
	Securities at amortized cost		95,709		42,841
	Loans and other financial assets at amortized cost		—		82,594

	Total		655,529		590,395

Related liabilities	Bonds sold under repurchase agreements		620,963		569,002

Securities loaned

When the Group loans its securities to outside parties, the legal ownerships of the securities are transferred; however, they should be returned at the end of lending period. Therefore, the Group does not derecognize them from the consolidated financial statements as it owns majority of risks and benefits from the securities continuously, regardless of the transfer of legal ownership. The carrying amounts of the securities loaned are as follows (Unit: Korean Won in millions):

June 30,
2020

December 31,
2019

Loaned to

Financial assets at FVTOCI

Korean financial institution’s debt securities and others

50,064

80,737

Korea Securities
Finance Corporation

The details of the transferred financial assets that do not meet the conditions of derecognition in their entirety, such as disposal of securities under repurchase agreement or securities loaned, are explained in Note 18. The Group does not have continuing involvement in transferred financial assets.

- 64 -

(2)	The offset of financial assets and liabilities

The Group possesses both the uncollected domestic exchange receivables and the unpaid domestic exchange payable, which satisfy offsetting criteria of K-IFRS 1032. Therefore, the total number of uncollected domestic exchange receivables or unpaid domestic exchange payable has been offset with part of unpaid domestic exchange payables or uncollected domestic exchange receivables and has been disclosed in loans at amortized cost and other financial assets and other financial liabilities of the Group’s statements of financial position respectively.

The Group possesses the derivative assets, derivative liabilities, receivable spot exchange and payable spot exchange that do not satisfy the offsetting criteria of K-IFRS 1032, but provide the Group under the circumstances of the trading party’s defaults, insolvency or bankruptcy, with the right of offsetting. Items such as cash collateral cannot satisfy the offsetting criteria of K-IFRS 1032, but in accordance with the collateral arrangements and under the circumstances of the trading party’s default, insolvency or bankruptcy, the net amount of derivative assets and derivative liabilities, receivable spot exchange and payable spot exchange can be offset.

The Group has entered into a resale and repurchase agreement and accounted it as a collateralized borrowing. The Group has also entered into a resale and purchase agreement and accounted it as a secured loans. The Group under the repurchase agreements has an offsetting right only upon the counterparty’s default, insolvency or bankruptcy; thus, the repurchase agreements are applied by the TBMA/ISMA Global Master Repurchase Agreement, which does not satisfy the offsetting criteria of K-IFRS 1032. The Group disclosed bonds sold under repurchase agreements as borrowings and bonds purchased under resale agreements as loan at amortized cost and other financial assets.

As of June 30, 2020 and December 31, 2019, the financial instruments to be offset and may be covered by master netting agreements and similar agreements are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Gross amounts of recognized financial assets		Gross amounts of recognized financial assets setoff		Net amounts of financial assets presented		Related amounts not setoff in the consolidated statement of financial position				Net amounts
	Gross amounts of recognized financial assets		Gross amounts of recognized financial assets setoff		Net amounts of financial assets presented		Netting agreements and others		Cash collateral received		Net amounts
Financial assets:
Derivative assets (*1)		4,015,508		—		4,015,508		11,070,878		642,295		1,061,726
Receivable spot exchange (*2)		8,759,391		—		8,759,391		11,070,878		642,295		1,061,726
Bonds purchased under resale agreements (*2)		8,358,028		—		8,358,028		8,358,028		—		—
Domestic exchange settlement debits (2) (6)		33,576,738		33,451,045		125,693		—		—		125,693

Total		54,709,665		33,451,045		21,258,620		19,428,906		642,295		1,187,419

Financial liabilities:
Derivative liabilities (*1)		3,188,188		—		3,188,188		11,069,505		359,031		544,565
Equity-linked securities in short position (*3)		24,486		—		24,486
Payable spot exchange (*4)		8,760,427		—		8,760,427
Bonds sold under repurchase agreements (*5)		620,963		—		620,963		145,367		442,900		32,696
Domestic exchange settlement credits (4) (6)		33,859,951		33,451,046		408,905		403,874		—		5,031

Total		46,454,015		33,451,046		13,002,969		11,618,746		801,931		582,292

(*1)	The items include derivative assets and liabilities held for trading and designated for hedging.

(*2)	The items are included in loan at amortized cost and other financial assets.

(*3)	The items are equity linked securities related to derivatives and are included in financial liabilities at FVTPL.

(*4)	The items are included in other financial liabilities.

(*5)	The items are included in borrowings.

(*6) Certain financial assets and liabilities are presented as net amounts.

- 65 -


	December 31, 2019
	Gross amounts of recognized financial assets		Gross amounts of recognized financial assets setoff		Net amounts of financial assets presented		Related amounts not setoff in the consolidated statement of financial position				Net amounts
	Gross amounts of recognized financial assets		Gross amounts of recognized financial assets setoff		Net amounts of financial assets presented		Netting agreements and others		Cash collateral received		Net amounts
Financial assets:
Derivative assets (*1)		3,032,894		—		3,032,894		7,058,885		111,122		975,093
Receivable spot exchange (*2)		5,112,206		—		5,112,206		7,058,885		111,122		975,093
Bonds purchased under resale agreements (*2)		8,981,752		—		8,981,752		8,981,752		—		—
Domestic exchange settlement debits (2) (6)		31,642,486		31,269,258		373,228		—		—		373,228

Total		48,769,338		31,269,258		17,500,080		16,040,637		111,122		1,348,321

Financial liabilities:
Derivative liabilities (*1)		2,824,449		—		2,824,449		7,071,549		172,488		779,424
Equity-linked securities in short position (*3)		87,626		—		87,626
Payable spot exchange (*4)		5,111,386		—		5,111,386
Bonds sold under repurchase agreements (*5)		569,002		—		569,002		180,402		388,600		—
Domestic exchange settlement credits (4) (6)		32,531,186		31,269,258		1,261,928		1,257,280		—		4,648

Total		41,123,649		31,269,258		9,854,391		8,509,231		561,088		784,072

(*1)	The items include derivatives held for trading, derivatives designated for hedging.

(*2)	The items are included in loan at amortized cost and other financial assets.

(*3)	The items are equity linked securities related to derivatives and are included in financial liabilities at FVTPL.

(*4)	The items are included in other financial liabilities.

(*5)	The items are included in borrowings.

(*6)	Certain financial assets and liabilities are presented as net amounts.

- 66 -

13.

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,
2020

December 31,
2019

Location

Financial
statements as of

Woori Bank:

W Service Networks Co., Ltd. (*1)

Freight & staffing services

4.9

Korea

May 31, 2020 (*5)

Korea Credit Bureau Co., Ltd. (*2)

Credit information

9.9

Korea

June 30, 2020

Korea Finance Security Co., Ltd. (*1)

Security service

15.0

Korea

May 31, 2020 (*5)

Saman Corporation (*2)

General construction Technology service

9.2

Korea

March 31, 2020 (*5)

Wongwang Co., Ltd. (*4)

Wholesale and real estate

29.0

Korea

—

Sejin Construction Co., Ltd. (*4)

Construction

29.6

Korea

—

ARES-TECH Co., Ltd. (*4)

Electronic component manufacturing

23.4

Korea

—

Reading Doctors Co., Ltd. (*4)

Other services

35.4

Korea

—

Cultizm Korea LTD Co., Ltd. (*4)

Wholesale and retail sales

31.3

Korea

—

NK Eng Co., Ltd. (*4)

Manufacturing

23.1

Korea

—

Goodskt Co., Ltd. (*4)

Telecommunication equipment retail sales

23.1

Korea

—

Woori Growth Partnerships New Technology Private Equity Fund

Other financial services

23.1

Korea

June 30, 2020

2016KIF-IMM Woori Bank Technology Venture Fund

Other financial services

20.0

Korea

June 30, 2020

K BANK Co., Ltd. (*2) (*8)

Finance

14.5

Korea

May 31, 2020 (*5)

Smart Private Equity Fund No. 2

Other financial services

20.0

Korea

June 30, 2020

Woori Bank-Company K Korea Movie Asset Fund

Other financial services

25.0

Korea

June 30, 2020

Well to Sea No. 3 Private Equity Fund (*6)

Finance

50.0

Korea

March 31, 2020 (*5)

Partner One Value Up I Private Equity Fund

Other financial services

23.3

Korea

June 30, 2020

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

Other financial services

20.0

Korea

June 30, 2020

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

Other financial services

25.0

Korea

June 30, 2020

LOTTE CARD Co., Ltd.

Credit card and installment financing

20.0

Korea

March 31, 2020 (*5)

Together-Korea Government Private Pool Private Securities Investment Trust No. 3 (*7)

Securities Investment

100.0

—

Korea

June 30, 2020

Japanese Hotel Real Estate Private Equity Fund 2

Other financial services

19.9

Korea

June 30, 2020

Woori Asset Management Co. Ltd.:

Woori All-in-One World EMP 40 [Bond Mixed-FOF] (*7)

Collective investment business

23.9

—

Korea

June 30, 2020

Woori High plus G.B. Securities Feeder Fund 1 (G.B.)

Collective investment business

22.9

—

Korea

June 30, 2020

Woori Private Equity Asset Management Co., Ltd.:

- 67 -

Percentage of ownership
(%)

Joint ventures and associates

Main business

June 30,
2020

December 31,
2019

Location

Financial
statements as of

Uri Hanhwa Eureka Private Equity Fund (*2)

Other financial services

0.8

Korea

June 30, 2020

Japanese Hotel Real Estate Private Equity Fund 1:

Godo Kaisha Oceanos 1

Other financial services

47.8

Japan

April 30, 2020 (*5)

Woori bank and Woori card Co., Ltd.:

Dongwoo C & C Co., Ltd. (*4)

Construction

24.5

Korea

—

SJCO Co., Ltd. (*4)

Aggregate transportation and wholesale

28.7

Korea

—

G2 Collection Co., Ltd. (*4)

Wholesale and retail sales

29.2

Korea

—

The Base Enterprise Co., Ltd. (*4)

Manufacturing

48.4

Korea

—

Kyesan Engineering Co., Ltd. (*4)

Construction

23.3

Korea

—

Good Software Lap Co., Ltd. (*4)

Service

29.4

Korea

—

QTS Shipping Co., Ltd. (*4)

Complex transportation brokerage

49.8

Korea

—

DAEA SNC Co., Ltd. (*4)

Wholesale and retail sales

25.5

Korea

—

Force TEC Co., Ltd. (*4)

Manufacturing

25.8

Korea

March 31, 2020
(*5)

Sinseong Trading Co., Ltd. (*4)

Manufacturing

27.9

Korea

—

PREXCO Co., Ltd. (*4)

Manufacturing

28.1

Korea

—

Jiwon Plating Co., Ltd. (*4)

Plating

20.8

Korea

—

Youngdong Sea Food Co., Ltd. (*4)

Processed sea food manufacturing

24.5

Korea

—

Woori Bank , Woori Investment Bank Co., Ltd. and Woori Private Equity Asset Management Co., Ltd.:

Woori-Shinyoung Growth-Cap Private Equity Fund I

Other financial services

31.9

Korea

June 30, 2020

Woori Bank and Woori Investment Bank Co., Ltd.:

Chin Hung International Inc. (*3)

Construction

25.3

Korea

May 31, 2020 (*5)

PCC-Woori LP Secondary Fund

Other financial services

38.8

Korea

June 30, 2020

Woori Bank and Woori Private Equity Asset Management Co., Ltd.:

Woori-Q Corporate Restructuring Private Equity Fund

Trust and collective investment

38.4

Korea

June 30, 2020

(*1)	Most of the significant business transactions of associates are with the Group as of June 30, 2020 and December 31, 2019.

(*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)	Equity securities that have published market price among investment assets of associates are common shares of Chin Hung International Inc. Quoted market prices of Chin Hung International Inc. are 1,970 Won and 2,310 Won as of June 30, 2020 and December 31, 2019, respectively.

(*4)	There is no investment balance as of June 30, 2020 and December 31, 2019.

(*5)

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.

(*6)	The Group has signed a contract that the Group (or the third party designated by the Group) has the priority to purchase the underlying assets (Aju Capital Co. Ltd.) when it is disposed by Well to Sea No. 3 Private Equity Fund.

(*7)	Due to capital contribution by the Group for the six-month period ended June 30, 2020, the entities have been included in associates.

(*8)	The Group invested 163,082 million Won in its affiliate, K BANK Co., Ltd., in July, 2020.

- 68-

(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, 2020
	Acquisition cost		January 1, 2020		Share of profits (losses)			Acquisi- tion		Disposal and others			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
Chin Hung International Inc.		130,779		51,176		(726	)		—		—			—			(22	)		50,428
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
Woori-Shinyoung Growth-Cap Private Equity Fund I		32,572		11,841		(61	)		19,906		—			—			—			31,686
LOTTE CARD Co.,Ltd		346,810		409,444		13,822			810		—			(5,710	)		(3,343	)		415,023
Woori-Q Corporate Restructuring Private Equity Fund		6,129		6,046		(80	)		—		—			—			—			5,966
PCC-Woori LP Secondary Fund		5,050		2,525		(124	)		2,525		—			—			—			4,926
Force TEC Co., Ltd.		—		—		1,563			—		—			—			(442	)		1,121
Together-Korea Government Private Pool Private Securities Investment Trust No.3		100,000		—		80			100,000		—			—			—			100,080
Uri Hanhwa Eureka Private Equity Fund		350		342		(2	)		—		—			—			—			340
Godo Kaisha Oceanos 1		10,800		10,952		209			—		—			(689	)		20			10,492
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
Woori High plus G.B. Securities Feeder Fund 1 (G.B.)		6,141		—		120			6,141		—			—			—			6,261

		893,481		806,360		23,938			136,402		(1,221	)		(30,941	)		(6,377	)		928,161

- 69 -


	For the six-month period ended June 30, 2019
	Acquisition cost		January 1, 2019		Share of profits (losses)			Acquisi- tion		Disposal and others			Dividends			Change in capital			June 30, 2019
W Service Networks Co., Ltd.		108		157		(2	)		—		—			(2	)		—			153
Korea Credit Bureau Co., Ltd.		3,313		6,790		604			—		—			(135	)		—			7,259
Korea Finance Security Co., Ltd.		3,267		3,456		(165	)		—		—			—			—			3,291
Chin Hung International Inc.		130,779		44,741		3,348			—		—			—			6			48,095
Saman Corporation		8,521		1,014		(175	)		—		—			—			32			871
Woori Growth Partnerships New Technology Private Equity Fund		19,385		25,091		1,543			309		(6,770	)		(164	)		—			20,009
2016KIF-IMM Woori Bank Technology Venture Fund		13,785		15,300		—			—		(1,215	)		—			(301	)		13,784
K BANK Co., Ltd.		67,343		43,709		(7,536	)		—		—			—			112			36,285
Smart Private Equity Fund No. 2		2,915		2,890		(21	)		—		(85	)		—			—			2,784
Woori Bank-Company K Korea Movie Asset Fund		3,000		2,700		196			—		—			—			—			2,896
Well to Sea No. 3 Private Equity Fund		101,483		197,393		13,608			—		—			(18,320	)		(695	)		191,986
Partner One Value Up I Private Equity Fund		10,000		9,948		(18	)		—		—			—			—			9,930
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership		4,576		4,426		—			150		—			—			—			4,576
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund		4,150		3,025		—			1,125		—			—			—			4,150
Nomura-Rifa Private Real Estate Investment Trust No. 17		1,000		787		(113	)		—		—			—			—			674
Uri Hanhwa Eureka Private Equity Fund		350		339		(2	)		—		—			—			—			337
Woori-Shinyoung Growth-Cap Private Equity Fund I		7,331		—		(410	)		7,331		—			—			—			6,921

		381,306		361,766		10,857			8,915		(8,070	)		(18,621	)		(846	)		354,001

- 70 -

(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, 2020
	Assets		Liabilities		Operating revenue			Net income (loss)
W Service Networks Co., Ltd.		6,001		2,693		8,591			648
Korea Credit Bureau Co., Ltd.		105,112		31,962		49,321			7,063
Korea Finance Security Co., Ltd.		36,895		15,534		27,614			(1,069	)
Chin Hung International Inc.		354,886		252,528		147,900			5,000
Saman Corporation		94,609		72,735		31,682			(238	)
Woori Growth Partnerships New Technology Private Equity Fund		74,631		321		143			(8,943	)
2016KIF-IMM Woori Bank Technology Venture Fund		70,489		—		5,891			5,879
K BANK Co., Ltd.		1,912,523		1,744,333		29,666			(36,766	)
Smart Private Equity Fund No. 2		13,767		50		1			(103	)
Woori Bank-Company K Korea Movie Asset Fund		11,026		73		1,336			1,260
Well to Sea No. 3 Private Equity Fund		7,825,825		7,196,602		194,164			16,827
Partner One Value Up I Private Equity Fund		42,426		—		214			(107	)
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership		30,948		640		382			(308	)
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund		15,684		114		284			38
Woori-Shinyoung Growth-Cap Private Equity Fund I		98,845		659		136			(1,235	)
LOTTE CARD Co., Ltd (*)		13,607,250		11,304,878		526,035			50,029
Woori-Q Corporate Restructuring Private Equity Fund		15,102		749		—			(799	)
PCC-Woori LP Secondary Fund		12,681		2		9			(319	)
Force TEC Co., Ltd.		50,271		45,922		8,405			(337	)
Together-Korea Government Private Pool Private Securities Investment Trust No. 3		100,103		13		94			81
Uri Hanhwa Eureka Private Equity Fund		42,464		232		1			(239	)
Godo Kaisha Oceanos 1		67,488		45,542		3,246			437
Japanese Hotel Real Estate Private Equity Fund 2		17,247		15		580			564
Woori All-in-One World EMP 40 [Bond Mixed-FOF]		20,610		—		(372	)		(373	)
Woori High plus G.B. Securities Feeder Fund 1 (G.B.)		27,375		—		(10	)		(10	)

(*)	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.

- 71 -


	December 31, 2019
	Assets		Liabilities		Operating revenue		Net income (loss)
W Service Networks Co., Ltd.		5,742		1,969		17,572		1,322
Korea Credit Bureau Co., Ltd.		96,855		30,289		91,200		1,480
Korea Finance Security Co., Ltd.		32,574		10,660		61,939		(1,265	)
Chin Hung International Inc.		335,147		229,764		499,152		26,617
Saman Corporation		92,206		66,184		91,088		(485	)
Woori Growth Partnerships New Technology Private Equity Fund		83,583		330		7,866		6,355
2016KIF-IMM Woori Bank Technology Venture Fund		72,768		343		8,939		7,462
K BANK Co., Ltd.		2,679,968		2,464,168		84,928		(89,779	)
Smart Private Equity Fund No. 2		13,872		51		2		(204	)
Woori Bank-Company K Korea Movie Asset Fund		13,294		2		4,532		2,492
Well to Sea No. 3 Private Equity Fund		7,073,363		6,470,540		524,319		48,357
Partner One Value Up I Private Equity Fund		42,602		—		457		(175	)
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership		21,208		691		766		(676	)
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund		16,939		124		10		(494	)
Woori-Shinyoung Growth-Cap Private Equity Fund I		37,642		620		2		(2,679	)
LOTTE CARD Co., Ltd (*)		12,936,977		10,659,889		1,366,512		42,538
Woori-Q Corporate Restructuring Private Equity Fund		15,975		823		—		(823	)
PCC-Woori LP Secondary Fund		6,498		—		—		(2	)
Uri Hanhwa Eureka Private Equity Fund		41,950		236		41		(436	)
Godo Kaisha Oceanos 1		70,869		47,960		778		119
Japanese Hotel Real Estate Private Equity Fund 2		16,561		6		—		(600	)

(*)	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.

(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, 2020 and December 31, 2019 are as follows:


	June 30, 2020
Associate (*)	Number of shares owned		Ownership (%)
Orient Shipyard Co., Ltd.		464,812		21.4
Saenuel Co., Ltd.		3,531		37.4
E Mirae Tech Co., Ltd.		7,696		41.0
Jehin Trading Co., Ltd.		81,610		27.3
The Season Company Co., Ltd.		18,187		30.1
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, 2019
Associate (*)	Number of shares owned		Ownership (%)
Orient Shipyard Co., Ltd.		464,812		21.4
Saenuel Co., Ltd.		3,531		37.4
E Mirae Tech Co., Ltd.		7,837		41.8
Jehin Trading Co., Ltd.		83,056		27.7
The Season Company Co., Ltd.		18,283		30.3
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.

- 72 -

(5)	As of June 30, 2020 and December 31, 2019, 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, 2020
	Total net asset		Ownership (%)			Ownership portion of net assets		Basis difference		Impairment			Intercompany transaction			Book value
W Service Networks Co., Ltd.		3,308		4.9	%		164		—		—			—			164
Korea Credit Bureau Co., Ltd.		73,150		9.9	%		7,249		246		—			3			7,498
Korea Finance Security Co., Ltd.		21,361		15.0	%		3,204		—		—			—			3,204
Chin Hung International Inc. (*1)		102,358		25.3	%		25,898		24,565		—			(35	)		50,428
Saman Corporation (*2)		21,874		9.2	%		2,011		5,372		(6,915	)		—			468
Woori Growth Partnerships New Technology Private Equity Fund		74,310		23.1	%		17,151		—		—			(3	)		17,148
2016KIF-IMM Woori Bank Technology Venture Fund		70,489		20.0	%		14,098		—		—			656			14,754
K BANK Co., Ltd. (1) (2)		168,189		14.5	%		24,354		3,634		(3,634	)		4			24,358
Smart Private Equity Fund No. 2		13,716		20.0	%		2,743		—		—			—			2,743
Woori Bank-Company K Korea Movie Asset Fund		10,952		25.0	%		2,738		—		—			—			2,738
Well to Sea No. 3 Private Equity Fund (*1)		400,054		50.0	%		199,948		—		—			(18	)		199,930
Partner One Value Up Ist Private Equity Fund		42,426		23.3	%		9,868		—		—			(1	)		9,867
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership		30,309		20.0	%		6,062		—		—			534			6,596
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund		15,570		25.0	%		3,892		—		—			162			4,054
Woori-Shinyoung Growth-Cap Private Equity Fund I		98,186		31.9	%		31,686		—		—			—			31,686
LOTTE CARD Co., Ltd (*1)		2,075,117		20.0	%		415,023		—		—			—			415,023
Woori-Q Corporate Restructuring Private Equity Fund		14,353		38.4	%		5,506		—		—			460			5,966
PCC-Woori LP Secondary Fund		12,679		38.8	%		4,923		3		—			—			4,926
Force TEC		4,349		25.8	%		1,121		—		—			—			1,121
Together-Korea Government Private Pool Private Securities Investment Trust No. 3		100,091		100.0	%		100,080		—		—			—			100,080
Uri Hanhwa Eureka Private Equity Fund		42,232		0.8	%		340		—		—			—			340
Godo Kaisha Oceanos 1		21,946		47.8	%		10,492		—		—			—			10,492
Japanese Hotel Real Estate Private Equity Fund 2		17,232		19.9	%		3,423		—		—			—			3,423
Woori All-in-One World EMP 40 [Bond Mixed-FOF]		20,610		23.9	%		4,893		—		—			—			4,893
Woori High plus G.B. Securities Feeder Fund 1 (G.B.)		27,375		22.9	%		6,261		—		—			—			6,261

(*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.

- 73 -


	December 31, 2019
	Total net asset		Ownership (%)			Ownership portion of net assets		Basis difference		Impairment			Intercompany transaction			Book value
W Service Networks Co., Ltd.		3,773		4.9	%		186		—		—			—			186
Korea Credit Bureau Co., Ltd.		66,566		9.9	%		6,597		246		—			2			6,845
Korea Finance Security Co., Ltd.		21,914		15.0	%		3,287		—		—			—			3,287
Chin Hung International Inc. (*1)		105,383		25.3	%		26,646		24,565		—			(35	)		51,176
Saman Corporation (*2)		26,022		9.2	%		2,391		5,373		(6,915	)		—			849
Woori Growth Partnerships New Technology Private Equity Fund		83,253		23.1	%		19,215		—		—			(3	)		19,212
2016KIF-IMM Woori Bank Technology Venture Fund		72,425		20.0	%		14,485		—		—			656			15,141
K BANK Co., Ltd. (1) (2)		215,800		14.5	%		31,248		3,634		(3,634	)		6			31,254
Smart Private Equity Fund No. 2		13,821		20.0	%		2,764		—		—			—			2,764
Woori Bank-Company K Korea Movie Asset Fund		13,292		25.0	%		3,323		—		—			—			3,323
Well to Sea No. 3 Private Equity Fund (*1)		418,250		50.0	%		209,041		—		—			(18	)		209,023
Partner One Value Up Ist Private Equity Fund		42,602		23.3	%		9,909		—		—			(1	)		9,908
IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership		20,517		20.0	%		4,103		—		—			473			4,576
Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund		16,815		25.0	%		4,204		—		—			171			4,375
Woori-Shinyoung Growth-Cap Private Equity Fund I		37,022		31.9	%		11,841		—		—			—			11,841
LOTTE CARD Co., Ltd (*1)		2,047,220		20.0	%		409,444		—		—			—			409,444
Woori-Q Corporate Restructuring Private Equity Fund		15,152		38.4	%		5,813		—		—			233			6,046
PCC-Woori LP Secondary Fund		6,498		38.8	%		2,524		—		—			1			2,525
Uri Hanhwa Eureka Private Equity Fund		41,714		0.8	%		342		—		—			—			342
Godo Kaisha Oceanos 1		22,909		47.8	%		10,952		—		—			—			10,952
Japanese Hotel Real Estate Private Equity Fund 2		16,555		19.9	%		3,291		—		—			—			3,291

(*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.

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14.

INVESTMENT PROPERTIES

(1)	Details of investment properties are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Acquisition cost		333,946			299,802
Accumulated depreciation		(21,140	)		(19,563	)

Net carrying value		312,806			280,239

(2)	Changes in investment properties are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30
	2020			2019
Beginning balance		280,239			378,196
Acquisition		1,514			135,974
Disposal		(354	)		—
Depreciation		(1,087	)		(1,298	)
Transfers from (to) premises and equipment		31,681			(172,798	)
Foreign currencies translation adjustments		430			2,013
Others		383			7,311

Ending balance		312,806			349,398

(3)

Rental fee earned from investment properties is amounting to 7,577 million Won and 3,442 million Won for the six-month period ended June 30, 2020 and 2019, respectively. Operating expenses directly related to the investment properties where rental fee was earned is amounting to 1,146 million Won and 1,346 million Won.

15.

PREMISES AND EQUIPMENT

(1)	Details of premises and equipment as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Land		Building		Equipment and vehicles		Leasehold improvement		Construction in progress		Structures		Total
Premises and equipment (owned)		1,724,481		788,704		270,275		53,060		863		2		2,837,385
Right-of-use asset		—		458,452		15,172		—		—		—		473,624
Carrying value		1,724,481		1,247,156		285,447		53,060		863		2		3,311,009


	December 31, 2019
	Land		Building		Equipment and vehicles		Leasehold improvement		Construction in progress		Structures		Total
Premises and equipment (owned)		1,761,159		802,299		278,016		54,839		1,287		2		2,897,602
Right-of-use asset		—		449,878		17,236		—		—		—		467,114
Carrying value		1,761,159		1,252,177		295,252		54,839		1,287		2		3,364,716

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(2)	Details of premises and equipment (owned) as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Land		Building			Equipment and vehicles			Leasehold improvement			Construction in progress		Structures			Total
Acquisition cost		1,724,481		1,065,020			1,151,011			469,111			863		20			4,410,506
Accumulated depreciation		—		(276,316	)		(880,736	)		(416,051	)		—		(18	)		(1,573,121	)

Net carrying value		1,724,481		788,704			270,275			53,060			863		2			2,837,385


	December 31, 2019
	Land		Building			Equipment and vehicles			Leasehold improvement			Construction in progress		Structures			Total
Acquisition cost		1,761,159		1,063,756			1,123,101			463,181			1,287		20			4,412,504
Accumulated depreciation		—		(261,457	)		(845,085	)		(408,342	)		—		(18	)		(1,514,902	)

Net carrying value		1,761,159		802,299			278,016			54,839			1,287		2			2,897,602

(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, 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


	For the six-month period ended June 30, 2019
	Land			Building			Equipment and vehicles			Leasehold improvement			Construction in progress			Structures			Total
Beginning balance		1,481,871			661,912			240,013			57,594			9,099			3			2,450,492
Acquisitions		301			13,084			65,596			12,911			5,967			—			97,859
Disposals		(3,232	)		(2,245	)		(66	)		(1,557	)		—			—			(7,100	)
Depreciation		—			(14,775	)		(42,152	)		(13,000	)		—			(1	)		(69,928	)
Transfer		97,761			85,554			2,658			987			(13,950	)		—			173,010
Foreign currencies translation adjustments		707			662			1,274			628			36			—			3,307
Others		—			87			(304	)		(3,170	)		(272	)		—			(3,659	)

Ending balance		1,577,408			744,279			267,019			54,393			880			2			2,643,981

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(4)	Details of right-of-use assets as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Building			Equipment and vehicles			Total
Acquisition cost		701,528			26,782			728,310
Accumulated depreciation		(243,076	)		(11,610	)		(254,686	)

Net carrying value		458,452			15,172			473,624


	December 31, 2019
	Building			Equipment and vehicles			Total
Acquisition cost		615,201			25,563			640,764
Accumulated depreciation		(165,323	)		(8,327	)		(173,650	)

Net carrying value		449,878			17,236			467,114

(5)	Details of changes in right-of-use assets for the six-month period ended June 30, 2020 and 2019 are as follows (Unit: Korean Won in millions):


	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


	For the six-month period ended June 30, 2019
	Building			Equipment and vehicles			Total
Beginning balance		416,827			18,964			435,791
New contracts		139,147			4,357			143,504
Changes in contract		(341	)		404			63
Termination		(3,247	)		(239	)		(3,486	)
Depreciation		(88,482	)		(4,803	)		(93,285	)
Others		(564	)		(162	)		(726	)

Ending balance		463,340			18,521			481,861

- 77 -

16.

INTANGIBLE ASSETS

(1)	Details of intangible assets are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Goodwill		Software			Industrial property rights			Development cost			Other intangible assets			Membership deposit			Construction in progress		Total
Acquisition cost		354,404		180,874			1,699			544,724			873,222			36,134			3,908		1,994,965
Accumulated amortization		—		(144,148	)		(988	)		(326,915	)		(665,669	)		—			—		(1,137,720	)
Accumulated impairment losses		—		—			—			—			(33,682	)		(3,183	)		—		(36,865	)

Net carrying value		354,404		36,726			711			217,809			173,871			32,951			3,908		820,380


	December 31, 2019
	Goodwill		Software			Industrial property rights			Development cost			Other intangible assets			Membership deposit			Construction in progress		Total
Acquisition cost		350,682		174,132			1,576			517,224			862,313			32,583			4,066		1,942,576
Accumulated amortization		—		(138,300	)		(884	)		(292,031	)		(638,005	)		—			—		(1,069,220	)
Accumulated impairment losses		—		—			—			—			(25,993	)		(3,253	)		—		(29,246	)

Net carrying value		350,682		35,832			692			225,193			198,315			29,330			4,066		844,110

(2)	Details of changes in intangible assets are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020
	Goodwill			Software			Industrial property rights			Development cost			Other intangible assets			Membership deposit			Construction in progress			Total
Beginning balance		350,682			35,832			692			225,193			198,315			29,330			4,066			844,110
Acquisitions		—			4,891			123			27,060			10,233			3,903			273			46,483
Disposal		—			—			—			—			—			(300	)		—			(300	)
Amortization (*)		—			(4,422	)		(104	)		(34,872	)		(28,284	)		—			—			(67,682	)
Impairment losses		—			—			—			—			(7,687	)		—			—			(7,687	)
Transfer		—			—			—			428			—			—			(428	)		—
Foreign currencies translation adjustment		5,348			562			—			—			329			63			(3	)		6,299
Others		(1,626	)		(137	)		—			—			965			(45	)		—			(843	)

Ending balance		354,404			36,726			711			217,809			173,871			32,951			3,908			820,380

(*)	Amortization of other intangible assets amounting to 6,786 million Won is included in other operating expenses.


	For the six-month period ended June 30, 2019
	Goodwill		Software			Industrial property rights			Development cost			Other intangible assets			Membership deposit			Construction in progress			Total
Beginning balance		153,602		29,727			562			240,320			139,297			23,597			10,415			597,520
Acquisitions		—		7,784			132			14,680			67,712			4,811			2,922			98,041
Disposal		—		—			—			—			—			(989	)		—			(989	)
Amortization (*)		—		(5,665	)		(89	)		(31,644	)		(24,723	)		—			—			(62,121	)
Impairment losses		—		—			—			—			—			(447	)		—			(447	)
Transfer		—		—			—			7,928			165			—			(8,093	)		—
Foreign currencies translation adjustment		8,477		755			—			—			1,189			82			—			10,503
Others		—		63			—			(13	)		(175	)		588			2			465

Ending balance		162,079		32,664			605			231,271			183,465			27,642			5,246			642,972

(*)	Amortization of other intangible assets amounting to 10,592 million Won is included in other operating expenses.

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17.

ASSETS HELD FOR SALE

The Group is planning to sell land, buildings and machinery, which are the inflow of subsidiaries, Seari First Securitization Specialty Co., Ltd., Namjong 1st Securitization Specialty Co.,Ltd. and Bukgeum First Securitization Specialty Co., Ltd. in October 2020 and has classified the assets as held for sale.

Assets held for distribution (sale) are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Lands		4,770		5,164
Buildings		4,392		4,815
Others		452		577

Total		9,614		10,556

The Group measured assets held for sale at the lower of their net fair value or carrying amount.

18.

ASSETS SUBJECT TO LIEN AND ASSETS ACQUIRED THROUGH FORECLOSURES

(1)	Assets subjected to lien are as follows (Unit: Korean Won in millions):


		June 30, 2020
		Collateral given to	Amount		Reason for collateral
Financial assets at FVTPL	Korean treasury and government bonds and others	Kookmin bank and others		464,542	Related to bonds sold under repurchase agreements (*)
	Korean treasury and government bonds and others	Shinhan Investment Corp.		506	Collateral for futures transaction
	Korean corporate debt securities	Eugene investment & futures co., Ltd.		4,556	Collateral for futures transaction
Financial assets at FVTOCI	Korean financial institutions’ debt securities and others	The BOK and others		3,668,634	Settlement risk and others
	Foreign financial institutions’ debt securities	Spain BBVA and others		95,278	Related to bonds sold under repurchase agreements (*)
	Foreign financial institutions’ debt securities	FHLB Advance		5,166	Related to the borrowing limit
Securities at amortized cost	Korean treasury and government bonds and others	Korea Securities Depository		5,579	Related to bonds sold under repurchase agreements (*)
	Foreign financial institutions’ debt securities	NATIXIS and others		90,130	Related to bonds sold under repurchase agreements (*)
	Korean treasury and government bonds and others	The BOK and others		6,659,827	Settlement risk and others
	Foreign financial institutions’ debt securities	Federal Reserve Bank		16,848	Related to the borrowing limit
Loan at amortized cost and other financial assets	Due from banks in local currencies	Daishin AMC Co.,Ltd. and others		1,500	Right of pledge
	Other due from banks in local currencies	Samsung Securities Co., Ltd. and others		31,167	Margin deposit for futures or option
	Other due from banks in foreign currencies	Korea Investment & Securities Co., Ltd. and others		718,177	Foreign margin deposit for future or option and others
Investment real estate	Land and building	Credit Counselling & Recovery Service and others		5,754	Right to collateral and others
Premises and equipment	Land and building	Credit Counselling & Recovery Service and others		1,999	Right to collateral and others

		Total		11,769,663

(*)

The Group has the agreements to repurchase the sold assets at the predetermined price or the price that includes the rate of return and to provide the guarantee on the assets. The transferee has the right to sell or to provide as guarantee. Therefore, the Group does not derecognize the assets, but recognizes the relevant amounts as liability (bonds sold under repurchase agreements). The asset is equivalent to a mortgage-backed debt security.

- 79 -


		December 31, 2019
		Collateral given to	Amount		Reason for collateral
Financial assets at FVTPL	Korean treasury and government bonds and others	Nonghyup bank		19,720	Related to bonds sold under repurchase agreements (*)
	Korean corporate debt securities	Kookmin bank and others		168,327	Related to bonds sold under repurchase agreements (*)
	Korean corporate debt securities	Eugene investment & futures co., Ltd.		3,008	Collateral for futures transaction
	Korean financial institutions’ debt securities and others	Nonghyup bank and others		219,938	Related to bonds sold under repurchase agreements (*)
Financial assets at FVTOCI	Korean financial institutions’ debt securities and others	The BOK and others		5,127,383	Settlement risk and others
	Foreign financial institutions’ debt securities	Spain BBVA and others		56,975	Related to bonds sold under repurchase agreements (*)
	Korean corporate debt securities	Nonghyup bank futures and others		9,042	Collateral for futures transaction
Securities at amortized cost	Korean treasury and government bonds	Korea Securities Depository		5,570	Related to bonds sold under repurchase agreements (*)
	Korean treasury and government bonds and others	The BOK and others		6,190,630	Settlement risk and others
	Foreign financial institutions’ debt securities	NATIXIS and others		37,271	Related to bonds sold under repurchase agreements (*)
Loan at amortized cost and other financial assets	Due from banks in local currency	Branch of IBK at Phnom Penh and others		11,352	Collateral deposits for local currency borrowings
	Due from banks in local currencies	Daishin AMC and others		1,500	Right of pledge
	Other due from banks in local currencies	Samsung Securities Co., Ltd. and others		17,345	Margin deposit for futures or option
	Other due from banks in foreign currencies	Korea Investment & Securities Co., Ltd. and others		180,919	Foreign margin deposit for future or option and others
	Foreign currency loans	Industrial and Commercial Bank of China		82,594	Related to bonds sold under repurchase agreements (*)
Premises and equipment	Land and building	Credit Counselling & Recovery Service and others		689	Right to collateral and others

		Total		12,132,263

(*)

- 80 -

(2)	As of June 30, 2020 and December 31, 2019 there is no asset acquired through foreclosures.


	June 30, 2020			December 31, 2019
Other assets
Land		6,792			27
Real estate assessment provision		(95	)		(27	)
Sub-total		6,697			—
Assets held for sale
Land		4,770			5,143
Building		4,392			4,742
Others		452			577
Sub-total		9,614			10,462
Total		16,311			10,462

(3)	Securities loaned are as follows (Unit: Korean Won in millions):

June 30,
2020

December 31,
2019

Loaned to

Financial assets at FVTOCI

Korean financial institutions’ debt securities and others

50,064

80,737

Korea Securities Finance Corporation

Securities loaned are lending of specific securities to borrowers who agree to return the same amount of the same security at the end of lending period. As the Group does not derecognize these securities, there are no liabilities recognized through such transactions relates to securities loaned.

(4)	Collaterals held that can be disposed and re-subjected to lien regardless of defaults of counterparties

Fair values of collaterals held that can be disposed and re-subjected to lien regardless of defaults of counterparties as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Fair values of collaterals		Fair values of collaterals were disposed or re-subjected to lien
Securities		8,722,185		—

	December 31, 2019
	Fair values of collaterals		Fair values of collaterals were disposed or re-subjected to lien
Securities		9,340,517		—

19.

OTHER ASSETS

Details of other assets are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Prepaid expenses		176,748		135,010
Advance payments		12,697		78,306
Non-operational assets		6,697		—
Others		24,954		20,330

Total		221,096		233,646

- 81 -

20.

FINANCIAL LIABILITIES AT FVTPL

(1)	Financial liabilities at FVTPL are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Financial instruments at fair value through profit or loss mandatorily measured at fair value		4,006,749		2,870,676
Financial liabilities at fair value through profit or loss designated as upon initial recognition		24,486		87,626

Total		4,031,235		2,958,302

(2)	Financial liabilities at fair value through profit or loss mandatorily measured at fair value are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Deposits
Gold banking liabilities		30,022		27,530
Derivative liabilities		3,976,727		2,843,146

Total		4,006,749		2,870,676

(3)	Financial liabilities at fair value through profit or loss designated as upon initial recognition as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Equity-linked securities
Equity-linked securities in short position		24,486		87,626

Financial liabilities at fair value through profit or loss designated as upon initial recognition are designated in order to eliminate or significantly reduce accounting mismatch arising from recognition or measurement.

(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 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 Group.

(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, 2020			December 31, 2019
Carrying amount		24,486			87,626
Nominal amount at maturity		40,436			97,503

Difference		(15,950	)		(9,877	)

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21.

DEPOSITS DUE TO CUSTOMERS

Details of deposits due to customers by type are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Deposits in local currency:
Deposits on demand		11,121,608			8,655,228
Deposits at termination		228,392,829			224,115,771
Mutual installment		27,534			28,574
Deposits on notes payables		2,601,529			2,174,995
Deposits on CMA		146,554			150,300
Certificate of deposits		1,811,837			973,625
Other deposits		1,390,155			1,451,470

Sub-total		245,492,046			237,549,963

Deposits in foreign currency:
Deposits in foreign currencies		31,484,315			27,143,710

Present value discount		(9,132	)		(8,095	)

Total		276,967,229			264,685,578

- 83 -

22.

BORROWINGS AND DEBENTURES

(1)	Details of borrowings are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Lenders	Interest rate (%)		Amount
Borrowings in local currency:
Borrowings from The BOK	The BOK		0.3		2,337,238
Borrowings from government funds	Small Enterprise And Market Service and others		0.0 ~ 2.4		2,228,910
Others	The Korea Development Bank and others		0.0 ~ 4.0		6,171,765

Sub-total					10,737,913

Borrowings in foreign currencies (*):
Borrowings in foreign currencies	The Export-Import Bank of Korea and others		0.0 ~ 8.0		8,734,938
Offshore borrowings in foreign currencies	HSBC, HKG		—		—

Sub-total					8,734,938

Bills sold	Others		0.0 ~ 1.2		10,489
Call money	Bank and others		(0.1) ~ 4.1		1,159,167
Bonds sold under repurchase agreements	Other financial institutions		(0.5) ~ 10.6		620,963
Present value discount					(344	)

Total					21,263,126


	December 31, 2019
	Lenders	Interest rate (%)		Amount
Borrowings in local currency:
Borrowings from The BOK	The BOK		0.5 ~ 0.8		1,770,726
Borrowings from government funds	Small Enterprise And Market Service and others		0.0 ~ 2.8		1,844,798
Others	The Korea Development Bank and others		0.0 ~ 5.0		6,070,201

Sub-total					9,685,725
Borrowings in foreign currencies (*):
Borrowings in foreign currencies	The Export-Import Bank of Korea and others		(0.3) ~ 8.3		8,566,872
Offshore borrowings in foreign currencies	HSBC, HKG		3.0		34,734

Sub-total					8,601,606

Bills sold	Others		0.0 ~ 1.6		9,367
Call money	Bank and others		(0.3) ~ 3.5		133,519
Bonds sold under repurchase agreements	Other financial institutions		1.4 ~ 12.7		569,002
Present value discount					(299	)

Total					18,998,920

(*)	Included borrowing in foreign currencies under cash flow hedge amounting to 35,860 million Won and 34,443 million Won as of June 30, 2020 and December 31, 2019.

- 84 -

(2)	Details of debentures are as follows (Unit: Korean Won in millions):


	June 30, 2020					December 31, 2019
	Interest rate (%)		Amount			Interest rate (%)		Amount
Face value of bond (*):
Ordinary bonds		0.9 ~ 3.1		22,318,449			0.0 ~ 4.3		23,207,600
Subordinated bonds		1.9 ~ 5.9		7,511,510			2.1 ~ 5.9		6,732,687
Other bonds		0.7 ~ 17.0		1,224,385			1.2 ~ 17.0		942,421

Sub-total				31,054,344					30,882,708

Discounts on bonds				(24,472	)				(24,653	)

Total				31,029,872					30,858,055

(*)

Included debentures under fair value hedge amounting to 3,377,943 million Won and 3,151,172 million Won as of June 30, 2020 and December 31, 2019 respectively. Also, debentures under cash flow hedge amounting to 1,164,367 million Won and 829,082 million Won are included as of June 30, 2020 and December 31, 2019 respectively.

23.

PROVISIONS

(1)	Details of provisions are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Asset retirement obligation		68,519		66,485
Provisions for guarantees (*1)		94,670		92,486
Provisions for unused loan commitments		132,409		112,554
Other provisions (*2)		255,791		172,455

Total		551,389		443,980

(*1)	Provisions for guarantees includes provision for financial guarantee of 58,360 million Won and 62,764 million Won as of June 30, 2020 and December 31, 2019, 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):

Provisions for guarantees


	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			—
Provisions used		—			—			—			—
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.

- 85 -


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2			Stage 3			Total
Beginning balance		44,903			33,760			11,098			89,761
Transfer to 12-month expected credit loss		(13,839	)		13,839			—			—
Transfer to expected credit loss for the entire period		654			(654	)		—			—
Transfer to credit-impaired financial assets		13			27			(40	)		—
Provisions used		(10,997	)		—			—			(10,997	)
Net provision (reversal) of unused amount		(14,805	)		9,385			13,560			8,140
Others (*)		17,036			2			1			17,039

Ending balance		22,965			56,359			24,619			103,943

(*)	Others have occurred as a result of new financial guarantee contract valued at initial fair value.

Provisions for unused loan commitment


	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


	For the six-month period ended June 30, 2019
	Stage 1			Stage 2			Stage 3			Total
Beginning balance		74,624			45,285			1,626			121,535
Transfer to 12-month expected credit loss		10,177			(10,115	)		(62	)		—
Transfer to expected credit loss for the entire period		(1,912	)		1,993			(81	)		—
Transfer to credit-impaired financial assets		(194	)		(225	)		419			—
Net provision (reversal) of unused amount		(7,699	)		11,032			1,274			4,607
Others		52			—			—			52

Ending balance		75,048			47,970			3,176			126,194

- 86 -

(3)	Changes in asset retirement for the six-month period ended June 30, 2020 and 2019, obligation are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30
	2020			2019
Beginning balance		66,485			67,200
Provisions provided		2,442			1,367
Provisions used		(548	)		(901	)
Reversal of provisions unused		(94	)		(2,664	)
Increase in restoration costs and others		234			202
Others		—			326

Ending balance		68,519			65,530

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, 2020, 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.

(4)	Changes in other provisions for the six-month period ended June 30, 2020 and 2019, are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30
	2020			2019
Beginning balance		172,455			63,637
Provisions provided		169,338			1,037
Provisions used		(87,260	)		(1,835	)
Reversal of provisions unused		(30	)		(47	)
Foreign currencies translation adjustments		1,374			44
Others		(86	)		—

Ending balance		255,791			62,836

(5)

Others

As of September 23, 2019, the Group temporarily suspended the Won-payment business due to tightened U.S. sanctions on Iran while it was ongoing to settle trade transactions between Korea and Iran. In connection with these services, the Group is currently being investigated by US government agencies including US prosecutors (United States Attorney’s Office and New York State Attorney General’s Office) and Office of Foreign Assets Control 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 US.

The Group recognized the provision of the estimated compensation amount related to the miss-selling of the Derivative Linked Fund (DLF) incurred during the previous term 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.

For the six-month period ended June 30, 2020, the Group recognized the provisions for the required expenditure as the best estimate to fulfill its obligations as of June 30, 2020 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.

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24.

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, 2020			December 31, 2019
Present value of defined benefit obligation		1,532,495			1,442,859
Fair value of plan assets		(1,386,170	)		(1,352,971	)

Net defined benefit liabilities (*)		146,325			89,888

(*)	Net defined benefit liability of 89,888 million Won as of December 31, 2019 is the subtracted amount of the net defined benefit asset of 2,582 million Won from the net defined benefit liability of 92,470 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
		2020			2019
Beginning balance			1,442,859			1,275,020
Transfer-in / out			—			7,409
Current service cost			86,569			82,172
Interest cost			16,768			16,207
Remeasurements	Financial assumption		15,857			54,669
	Demographic assumptions		—			—
	Experience adjustment		16,264			(10,741	)
Retirement benefit paid			(47,118	)		(67,284	)
Foreign currencies translation adjustments			43			152
Others			1,253			585

Ending balance			1,532,495			1,358,189

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(3)	Changes in the plan assets are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30
	2020			2019
Beginning balance		1,352,971			1,101,911
Transfer-in / out		—			7,409
Interest income		17,152			15,308
Remeasurements		(4,073	)		(5,556	)
Employer’s contributions		66,809			113,666
Retirement benefit paid		(46,725	)		(67,284	)
Others		36			(97	)

Ending balance		1,386,170			1,165,357

(4)	Plan assets consist of fixed deposits and others as of June 30, 2020 and December 31, 2019. Among plan assets, realized returns on plan assets amount to 13,079 million Won and 9,752 million Won for the six-month period ended June 30, 2020 and 2019, 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
	2020			2019
Current service cost		86,569			82,172
Net interest expense (income)		(384	)		899

Cost recognized in net income		86,185			83,071

Remeasurements (*)		36,194			49,484

Cost recognized in total comprehensive income		122,379			132,555

(*)	Amount before tax

Retirement benefits related to defined contribution plans recognized as expenses are 2,022 million Won, and 1,461 million Won for the six-month period ended June 30, 2020 and 2019, respectively.

25.

OTHER FINANCIAL LIABILITIES AND OTHER LIABILITIES

Other financial liabilities and other liabilities are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Other financial liabilities:
Accounts payable		10,107,251			6,131,339
Accrued expenses		1,904,644			2,516,231
Borrowings from trust accounts		3,261,198			3,277,795
Agency business revenue		415,256			362,820
Foreign exchange payables		479,939			1,153,457
Domestic exchange settlement credits		408,905			1,261,928
Lease liabilities		425,929			419,045
Other miscellaneous financial liabilities		2,636,882			2,587,193
Present value discount		(4,546	)		(3,041	)

Sub-total		19,635,458			17,706,767

Other liabilities:
Unearned income		229,562			224,840
Other miscellaneous liabilities		153,929			195,631

Sub-total		383,491			420,471

Total		20,018,949			18,127,238

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26.

DERIVATIVES

(1)	Derivative assets and derivative liabilities are as follows (Unit: Korean Won in millions):


	June 30, 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		284,401		—		—		—		—		—		—
Swaps		149,305,140		—		228,360		437,653		2,488		—		698,257
Purchase options		370,000		—		—		12,266		—		—		—
Written options		286,004		—		—		—		—		—		9,389
Currency:
Futures		47,800		—		—		—		—		—		—
Forwards		114,776,890		—		665		1,891,495		—		—		928,900
Swaps		90,895,590		20,855		—		1,332,196		12,534		—		1,542,861
Purchase options		1,932,976		—		—		18,112		—		—		—
Written options		2,734,002		—		—		—		—		—		15,738
Equity:
Futures		497,100		—		—		—		—		—		—
Forwards		11		—		—		—		—		—		—
Swaps		1,122,075		—		—		90,100		—		—		4,035
Purchase options		8,701,549		—		—		484,475		—		—		—
Written options		10,173,879		—		—		—		—		—		777,547

Total		381,127,417		20,855		229,025		4,266,297		15,022		—		3,976,727


	December 31, 2019
			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		124,737		—		—		—		—		—		—
Swaps		150,731,987		—		111,764		300,750		1,323		—		413,195
Purchase options		460,000		—		—		11,888		—		—		—
Written options		395,789		—		—		—		—		—		9,655
Currency:
Futures		1,934		—		—		—		—		—		—
Forwards		113,988,295		—		—		1,447,811		321		—		1,030,246
Swaps		82,125,050		9,367		—		966,181		5,193		—		1,106,423
Purchase options		1,588,746		—		—		18,835		—		—		—
Written options		2,341,179		—		—		—		—		—		9,403
Equity:
Futures		630,562		—		—		—		—		—		—
Forwards		11		—		—		—		—		—		—
Swaps		1,280,436		—		—		1,217		—		—		54,393
Purchase options		8,851,984		—		—		175,221		—		—		—
Written options		8,978,953		—		—		—		—		—		219,831

Total		371,499,663		9,367		111,764		2,921,903		6,837		—		2,843,146

Derivatives held for trading are classified into financial assets at FVTPL (Note 7) and financial liabilities at FVTPL (Note 20), and derivatives designated for hedging are presented as a separate line item in the consolidated statements of financial position.

- 90 -

(2)	Overview of the Group’s hedge accounting

The hedging relationships the entity 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, USD 6M LIBOR, and 3M EURIBOR. The nominal amounts of hedging instruments related to USD 1M LIBOR, USD 3M LIBOR, USD 6M LIBOR and 3M EURIBOR in the hedging relationships of the Group are USD 620,000,000, USD 2,230,000,000, USD 500,000,000, and EUR 26,635,556, respectively. The entity pays close attention to discussions in the market and industry regarding the applicable alternative benchmark interest rates for the exposed interest rate. The entity judges related uncertainty is expected to be no longer present when the exposed interest rates are replaced by the applicable benchmark interest rates.

Fair value hedge

①

Interest rate risk

As of the June 30, 2020, the Group has applied fair value hedge on fixed interest rate foreign currency denominated debentures amounting to 3,377,943 million Won. The purpose of the hedging is to avoid fair value volatility risk of fixed interest rate foreign currency denominated debentures derived from fluctuations of market interest rate, 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 (6M) 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.

②

Currency exchange rate risk

As of the June 30, 2020, the Group has applied a fair value hedge on equity securities in foreign currency amounting to 13,881 million Won. The Group’s hedging strategies are to mitigate the risk of the fair value fluctuation of equity securities in foreign currency invested in the EUR due to changes in the spot exchange rate (USD/EUR) and thereby designating it as a hedging instrument by entering into currency forward contracts in accordance with this strategy.

By applying the difference of currency exchange rate to the predetermined nominal amount of equity securities in foreign currency by the currency forward contracts, the calculated difference is recognized at fair value, which results in the conversion of the nominal amount from EUR to USD and eliminates the risk of fair value fluctuation due to currency change.

- 91 -

In this hedging relationship, only the spot element of currency forward is designated as the hedging relationship and the spot element is measured at the market price of the spot exchange rate. Other risk factors such as credit risk are not subject to hedging.

Thus, there could be hedge ineffectiveness arising from price margin set by the counterparty of hedging instruments and unilateral change in credit risk of any party in the transaction. The forward currency exchange contract and the hedged item are all affected by the changes in spot exchange rate which are basic factors of the derivative.

Cash Flow Hedge

As of the June 30, 2020, the Group has applied cash flow hedge on local currency denominated debentures amounting to 149,914 million Won, debentures on foreign currency amounting to 1,014,453 million Won and borrowings in foreign currency amounting to 35,860 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 and borrowings in foreign 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.

Thus, there could be hedge ineffectiveness arising 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.

- 92 -

(3)	The nominal amounts of the hedging instrument are as follows (Unit: USD, EUR, SGD, JPY and Korean Won in millions):


	June 30, 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)		850,000,000		1,500,000,000		300,000,000		2,650,000,000
Currency exchange rate risk
Currency forward (EUR/USD)		—		—		10,313,901		10,313,901
Cash flow hedge
Interest rate risk
Interest rate swap (EUR)		—		26,635,556		—		26,635,556
Interest rate swap (KRW)		—		150,000		—		150,000
Foreign currencies translation risk and interest rate risk
Currency swap (USD)		230,000,000		470,000,000		—		700,000,000
Foreign currencies translation risk
Currency swap (SGD)		204,000,000		—		—		204,000,000


	December 31, 2019
	1 year or less		1 year to 5 years		More than 5 years		Total
Fair value hedge
Interest rate risk
Interest rate swap (USD)		350,000,000		2,000,000,000		300,000,000		2,650,000,000
Cash flow hedge
Interest rate risk
Interest rate swap (EUR)		—		26,635,556		—		26,635,556
Interest rate swap (KRW)		—		100,000		—		100,000
Foreign currencies translation risk and interest rate risk
Currency swap (USD)		150,000,000		330,000,000		—		480,000,000
Foreign currencies translation risk
Currency swap (SGD)		136,000,000		68,000,000		—		204,000,000
Currency forward (JPY)		49,325,155		1,059,903,932		—		1,109,229,087

- 93 -

(4)	The average interest rate and average currency rate of the hedging instrument as of June 30, 2020 and December 31, 2019 are as follows:


		June 30, 2020
		Average interest rate and average exchange rate
Fair value hedge
Interest rate risk
Interest rate swap (USD)		Fixed 3.96% receipt and Libor 3M+1.61% floating paid Fixed 5.88% receipt and Libor 6M+2.15% floating paid
Currency exchange rate risk
Currency forward (EUR/USD)		USD 13,369,909.86 receipt, EUR 10,313,901 paid
Cash flow hedge
Interest rate risk
Interest rate swap (EUR)		3M EURIBOR receipt, EUR 0.09% paid
Interest rate swap (KRW)		KRW 3Y CMS+0.40% receipt, KRW 2.38% paid KRW CD+0.33% receipt, KRW 1.68% paid
Foreign currencies translation risk and interest rate risk
Currency swap (USD)		USD 3M Libor+0.8% receipt, KRW 1.45% paid, KRW/USD = 1,155 USD 1M Libor+0.54% receipt, KRW 1.52% paid, KRW/USD = 1,151 USD 1M LIBOR+0.82% receipt, KRW 0.75% paid, KRW/USD = 1,233
Foreign currencies translation risk
Currency swap (SGD)		SGD 1.91% receipt, KRW 1.98% paid, KRW/SGD = 828


		December 31, 2019
		Average interest rate and average exchange rate
Fair value hedge
Interest rate risk
Interest rate swap (USD)		Fixed 3.96% receipt and Libor 3M+1.61% floating paid Fixed 5.88% receipt and Libor 6M+2.15% floating paid
Cash flow hedge
Interest rate risk
Interest rate swap (EUR)		3M EURIBOR receipt, EUR 0.09% paid
Interest rate swap (KRW)		KRW 3Y CMS+0.40% receipt, 2.38% paid
Foreign currencies translation risk and interest rate risk
Currency swap (USD)		USD 3M Libor+0.8% receipt, KRW 1.45% paid, KRW/USD = 1,155 USD 1M Libor+0.54% receipt, KRW 1.53% paid, KRW/USD = 1,158
Foreign currencies translation risk
Currency swap (SGD)		SGD 1.91% receipt, KRW 1.98% paid, KRW/SGD = 828
Currency forward (JPY)		KRW/JPY = 10.47

- 94 -

(5)	The amounts related to items designated as hedging instruments are as follows (Unit: Korean Won in millions, USD, EUR, SGD and JPY):

June 30, 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 2,650,000,000

228,360

—

Derivative assets

(designated for hedging)

110,674

Currency exchange rate risk

Currency forward

EUR 10,313,901

665

—

Derivative assets

(designated for hedging)

665

Cash flow hedge

Interest rate risk

Interest rate swap

EUR 26,635,556

—

Derivative liabilities

(designated for hedging)

Interest rate swap

KRW 150,000

—

2,430

Derivative liabilities

(designated for hedging)

(1,150

)

Foreign currency translation risk and interest rate risk

Currency swap

USD 700,000,000

14,074

12,534

Derivative assets

(designated for hedging)

Derivative liabilities

(designated for hedging)

2,254

Foreign currency translation risk

Currency swap

SGD 204,000,000

6,781

Derivative assets

(designated for hedging)

1,478

December 31, 2019

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 2,650,000,000

111,764

Derivative assets

(designated for hedging)

90,244

Cash flow hedge

Interest rate risk

Interest rate swap

EUR 26,635,556

—

Derivative liabilities

(designated for hedging)

(43

)

Interest rate swap

KRW 100,000

—

1,280

Derivative liabilities

(designated for hedging)

(615

)

Foreign currency translation risk and interest rate risk

Currency swap

USD 480,000,000

4,070

5,193

Derivative assets

(designated for hedging)

Derivative liabilities

(designated for hedging)

22,364

Foreign currency translation risk

Currency swap

SGD 204,000,000

5,297

—

Derivative assets

(designated for hedging)

8,918

Currency forward

JPY 1,109,229,087

—

321

Derivative liabilities

(designated for hedging)

321

- 95 -

(6)	Details of carrying amount to hedge and amount due to hedge accounting are as follows (Unit: Korean Won in millions):


	June 30, 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							Cash flow hedge reserve (*)
Fair value hedge
Interest rate risk
Debentures		—		3,377,943		—			202,844		Debentures		(108,090	)		—
Currency exchange rate risk
Securities in foreign currency		13,881		—		(665	)		—		Securities in foreign currency		(665	)		—
Cash flow hedge
Interest rate risk
Borrowings in foreign currency		—		35,860		—			—		Borrowing foreign currency		58			(58	)
Debentures		—		149,914		—			—		Debentures		2,094			(1,600	)
Foreign currencies translation risk and interest rate risk
Debentures		—		838,902		—			—		Debentures		(8,935	)		(12,346	)
Foreign currencies translation risk
Debentures		—		175,551		—			—		Debentures		(1,172	)		(1,776	)

(*)	After tax amount


	December 31, 2019
	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							Cash flow hedge reserve (*)
Fair value hedge
Interest rate risk
Debentures		—		3,151,172		—		91,368		Debentures		(85,984	)		—
Cash flow hedge
Interest rate risk
Borrowings in foreign currency		—		34,443		—		—		Borrowing foreign currency		43			(43	)
Debentures		—		99,941		—		—		Debentures		663			(821	)
Foreign currencies translation risk and interest rate risk
Debentures		—		554,433		—		—		Debentures		(25,057	)		(2,525	)
Foreign currencies translation risk
Debentures		—		174,708		—		—		Debentures		(8,315	)		(2,304	)

(*)	After tax amount

- 96 -

(7)	Amounts recognized in profit or loss due to the ineffective portion of fair value hedges during the current period are as follows (Unit: Korean Won in millions):


		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)


		For the six-month period ended June 30, 2019
		Hedge ineffectiveness recognized in profit or loss		Line item in the profit or loss that includes hedge ineffectiveness
Fair value hedge	Interest rate risk		1,280	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, 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)

		For the six-month period ended June 30, 2019
		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		(785	)		—			—		Other net operating income (expense)		—		Other net operating income (expense)
	Foreign currencies translation risk and interest rate risk		18,349			65			285		Other net operating income (expense)		(19,105	)	Other net operating income (expense)
	Foreign currencies translation risk		7,423			510			(2	)	Other net operating income (expense)		(7,430	)	Other net operating income (expense)

- 97 -

27.

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
	2020			2019
Beginning balance		52,260			25,463
New transactions		26,267			50,981
Amounts recognized in losses		(35,306	)		(21,112	)

Ending balance		43,221			55,332

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 losses.

28.

EQUITY

(1)	Details of equity as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Capital
Common stock capital		3,611,338			3,611,338
Hybrid securities		1,695,821			997,544
Capital surplus
Paid in capital in excess of par		608,348			608,348
Equity method		895			1,153
Others		18,382			16,794

Sub-total		627,625			626,295

Capital adjustments
Treasury stocks		—			—
Other adjustments (*1)		(1,773,569	)		(1,748,667	)

Sub-total		(1,773,569	)		(1,748,667	)

Accumulated other comprehensive income
Financial assets at FVTOCI		(97,033	)		(71,914	)
Changes in capital due to equity method		(3,706	)		915
Loss from foreign business translation		(98,542	)		(152,987	)
Remeasurements of defined benefit plan		(297,218	)		(270,977	)
Loss on evaluation of cash flow hedge		(15,722	)		(5,692	)

Sub-total		(512,221	)		(500,655	)

Retained earnings (2) (3)		18,652,199			18,524,515
Non-controlling interest (*4)		3,450,495			3,981,962

Total		25,751,688			25,492,332

(*1)

Included capital transaction gains and losses recognized by the 2014 merger of Woori Bank and, formerly, Woori Financial Group Inc. During the previous term, the Group entered an agreement to acquire additional interest in the Woori Asset Trust Co., Ltd., and the capital adjustment reduced by 111,242 million Won.

(*2)	The earned surplus reserve in retained earnings amounted to 2,547,547 million Won and 2,356,246 million Won as of June 30, 2020 and December 31, 2019, respectively in accordance with the relevant article.

(*3)	The regulatory reserve for credit loss in retained earnings amounted to 62,830 million Won as of June 30, 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 and 3,660,814 million Won as of June 30, 2020 and December 31, 2019, respectively, are recognized as non-controlling interests. 90,091 million Won and 78,290 million Won of dividends for the hybrid securities are allocated to net profit and loss of the non-controlling interests for the six-month period ended June 30, 2020 and 2019, respectively.

- 98 -

(2)	The number of authorized shares and others of the Group are as follows:


	June 30, 2020		December 31, 2019
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, 2020			December 31, 2019
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			—
Securities in local currency		2020-06-12	—		3.23		300,000			—
Issuance cost							(4,179	)		(2,456	)

Total							1,695,821			997,544

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, 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.

- 99 -


	For the six-month period ended June 30, 2019
	Beginning balance			Increase (decrease) (*)			Reclassification adjustments			Income tax effect			Ending balance
Net gain (loss) on valuation of financial assets at FVTOCI		(87,182	)		44,136			688			(11,331	)		(53,689	)
Changes in capital due to equity method		302			(650	)		—			232			(116	)
Gain (loss) on foreign currency translation of foreign operations		(244,735	)		99,546			—			(4,955	)		(150,144	)
Remeasurement gain (loss) related to defined benefit plan		(236,726	)		(48,857	)		—			9,828			(275,755	)
Gain (loss) on valuation of derivatives designated as cash flow hedges		(3,869	)		13,569			(14,032	)		(707	)		(5,039	)

Total		(572,210	)		107,744			(13,344	)		(6,933	)		(484,743	)

(*)	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 27,002 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.

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, 2020			December 31, 2019
Beginning balance		2,547,547			2,356,246
Planned provision of regulatory reserve (reversal) for credit loss		(12,236	)		191,301

Ending balance		2,535,311			2,547,547

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, 2020						Periods ended June 30, 2019
	Three-month			Six-month			Three-month		Six-month
Net income before regulatory reserve		216,262			774,033			657,434		1,271,963
Provision of regulatory reserve (reversal) for credit loss		(80,155	)		(12,236	)		38,159		119,245
Adjusted net income after the provision of regulatory reserve		296,417			786,269			619,275		1,152,718
Dividends to hybrid securities		(11,852	)		(20,365	)		—		—
Adjusted net income after regulatory reserve and dividends to hybrid securities		284,565			765,904			619,275		1,152,718
Adjusted EPS after regulatory reserve and the dividends to hybrid securities (Unit: Korean Won)		394			1,061			911		1,715

- 100 -

29.

DIVIDENDS

Dividends per share and the total dividends for the fiscal year ending December 31, 2019 were 700 Won and 505,587 million Won, respectively, and the dividends were approved at the regular general shareholders’ meeting held on March 25, 2020.

30.

NET INTEREST INCOME

(1)	Interest income recognized is as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020				Periods ended June 30, 2019
	Three-month		Six-month		Three-month		Six-month
Financial assets at FVTPL		13,681		26,210		14,771		27,905
Financial assets at FVTOCI		114,823		241,000		113,790		209,102
Financial assets at amortized cost:
Securities at amortized cost		98,001		202,060		108,900		225,196
Loans and other financial assets at amortized cost:
Interest on due from banks		9,866		32,735		33,049		66,308
Interest on loans		2,168,347		4,398,249		2,395,747		4,734,200
Interest of other receivables		7,471		15,749		7,701		14,981

Subtotal		2,185,684		4,446,733		2,436,497		4,815,489

Total		2,412,189		4,916,003		2,673,958		5,277,692

(2)	Details of interest expense recognized are as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020				Periods ended June 30, 2019
	Three-month		Six-month		Three-month		Six-month
Interest on deposits due to customers		664,329		1,413,501		869,350		1,716,811
Interest on borrowings		80,915		165,586		103,094		193,125
Interest on debentures		178,699		367,192		200,075		383,815
Other interest expense		8,232		23,593		22,925		48,978
Interest on lease liabilities		2,124		5,282		2,053		3,911

Total		934,299		1,975,154		1,197,497		2,346,640

- 101 -

31.

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, 2020				Periods ended June 30, 2019
	Three-month		Six-month		Three-month		Six-month
Fees and commission received for brokerage		40,910		81,136		39,840		82,560
Fees and commission received related to credit		43,976		96,904		43,367		84,628
Fees and commission received for electronic finance		30,081		61,764		35,238		67,496
Fees and commission received on foreign exchange handling		13,407		27,798		15,599		30,075
Fees and commission received on foreign exchange		15,359		32,034		28,597		48,217
Fees and commission received for guarantee		18,940		37,068		18,169		35,040
Fees and commission received on credit card		125,980		249,267		135,927		268,520
Fees and commission received on securities business		22,465		38,896		35,284		65,600
Fees and commission from trust management		35,929		86,292		47,825		89,845
Fees and commission received on credit information		3,791		7,194		3,224		6,353
Other fees		46,444		89,640		33,610		69,907

Total		397,282		807,993		436,680		848,241

(2)	Details of fees and commissions expense incurred are as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020				Periods ended June 30, 2019
	Three-month		Six-month		Three-month		Six-month
Fees and commissions paid		52,045		93,405		43,564		82,906
Credit card commission		118,647		211,784		106,296		200,343
Brokerage commission		156		217		276		481
Others		2,065		4,238		1,455		4,421

Total		172,913		309,644		151,591		288,151

32.

DIVIDEND INCOME

(1)	Details of dividend income recognized are as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020				Periods ended June 30, 2019
	Three-month		Six-month		Three-month		Six-month
Dividend income related to financial assets at FVTPL		21,576		54,382		22,616		47,097
Dividend income related to financial assets at FVTOCI		1,657		16,620		2,484		17,486

Total		23,233		71,002		25,100		64,583

(2)	Details of dividends related to financial assets at FVTOCI are as follows (Unit: Korean Won in millions):

Periods ended June 30, 2020

Periods ended June 30, 2019

Three-month

Six-month

Three-month

Six-month

Dividend income recognized from assets held:

Equity securities

1,657

16,620

2,484

17,486

- 102 -

33.

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, 2020					Periods ended June 30, 2019
	Three-month			Six-month		Three-month			Six-month
Gain on financial instruments at fair value through profit or loss mandatorily measured at fair value		(64,135	)		393,168		70,362			110,376
Gain (loss) on financial instruments at fair value through profit or loss designated as upon initial recognition		(2,351	)		8,421		(6,867	)		(30,295	)

Total		(66,486	)		401,589		63,495			80,081

(2)	Details of net gain or loss on financial instruments at fair value through profit or loss mandatorily measured at fair value and financial instruments held for trading are as follows (Unit: Korean Won in millions):


			Periods ended June 30, 2020						Periods ended June 30, 2019
			Three-month			Six-month			Three-month			Six-month
Financial assets at FVTPL	Securities	Gain on transactions and valuation		48,576			97,202			43,575			101,080
		Loss on transactions and valuation		(2,851	)		(71,218	)		(21,701	)		(35,584	)

		Sub-total		45,725			25,984			21,874			65,496

	Loans	Gain on transactions and valuation		1,660			1,730			336			942
		Loss on transactions and valuation		(100	)		(862	)		52			(25	)

		Sub-total		1,560			868			388			917

	Other financial assets	Gain on transactions and valuation		1,638			4,505			839			1,276
		Loss on transactions and valuation		(1,508	)		(4,195	)		(753	)		(1,118	)

		Sub-total		130			310			86			158

Sub-total				47,415			27,162			22,348			66,571

Derivatives (Held for trading)	Interest rates derivatives	Gain on transactions and valuation		356,000			986,560			372,513			694,408
		Loss on transactions and valuation		(375,781	)		(1,320,559	)		(460,701	)		(845,400	)

		Sub-total		(19,781	)		(333,999	)		(88,188	)		(150,992	)

	Currency derivatives	Gain on transactions and valuation		45,273			6,200,908			2,384,208			4,184,468
		Loss on transactions and valuation		(110,208	)		(5,497,798	)		(2,252,893	)		(4,019,164	)

		Sub-total		(64,935	)		703,110			131,315			165,304

	Equity derivatives	Gain on transactions and valuation		(41,433	)		1,107,537			160,842			421,861
		Loss on transactions and valuation		14,755			(1,110,279	)		(155,759	)		(392,012	)

		Sub-total		(26,678	)		(2,742	)		5,083			29,849

	Other derivatives	Gain on transactions and valuation		—			—			338			639
		Loss on transactions and valuation		(156	)		(363	)		(534	)		(995	)

		Sub-total		(156	)		(363	)		(196	)		(356	)

Sub-total				(111,550	)		366,006			48,014			43,805

Net, total				(64,135	)		393,168			70,362			110,376

- 103 -

(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, 2020					Periods ended June 30, 2019
	Three-month			Six-month		Three-month			Six-month
Gain (loss) on equity-linked securities		(2,351	)		8,421		(6,867	)		(30,295	)

34.

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, 2020						Periods ended June 30, 2019
	Three-month			Six-month			Three-month		Six-month
Gain on redemption of securities		(35	)		(74	)		16		37
Gain on transactions of securities		8,462			11,101			2,638		3,408

Total		8,427			11,027			2,654		3,445

35.

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, 2020						Periods ended June 30, 2019
	Three-month			Six-month			Three-month			Six-month
Impairment loss due to credit loss on financial assets measured at FVTOCI		(770	)		(782	)		(1,265	)		(1,979	)
Reversal of (Provision for) impairment loss due to credit loss on securities at amortized cost		(190	)		(47	)		245			769
Provision for credit loss on loan and other financial assets at amortized cost		(319,532	)		(422,066	)		(65,030	)		(122,589	)
Reversal of provision on (provision for) guarantee		2,435			(3,972	)		(10,358	)		(8,140	)
Provision for unused loan commitment		(17,730	)		(19,812	)		(131	)		(4,607	)

Total		(335,787	)		(446,679	)		(76,539	)		(136,546	)

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36.

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, 2020				Periods ended June 30, 2019
			Three-month		Six-month		Three-month		Six-month
Employee benefits	Short-term employee benefits	Salaries		374,978		770,314		354,786		717,842
		Employee fringe benefits		126,905		248,461		122,801		230,473
	Share based payment			2,745		2,316		1,577		3,664
	Retirement benefit service costs			43,860		88,207		39,339		84,532
	Termination			558		221		—		7,566

		Subtotal		549,046		1,109,519		518,503		1,044,077

Depreciation and amortization				124,289		258,964		118,030		214,742
Other general and administrative expenses	Rent			20,246		35,172		23,787		60,785
	Taxes and public dues			40,080		74,268		39,226		73,763
	Service charges			59,737		116,624		59,945		112,199
	Computer and IT related			26,416		52,839		22,768		43,307
	Telephone and communication			18,266		35,091		17,050		33,085
	Operating promotion			9,696		20,718		9,485		19,382
	Advertising			19,060		28,412		20,801		30,190
	Printing			1,481		3,376		1,939		3,845
	Traveling			1,521		3,698		3,310		6,281
	Supplies			3,670		6,907		1,693		3,349
	Insurance premium			2,746		5,551		2,178		4,243
	Reimbursement			4,185		4,855		5,662		6,379
	Maintenance			4,088		7,994		4,720		8,932
	Water, light, and heating			3,188		7,640		3,302		7,497
	Vehicle maintenance			2,346		4,821		2,626		4,877
	Others			6,971		13,109		9,309		18,853

		Sub-total		223,697		421,075		227,801		436,967

	Total			897,032		1,789,558		864,334		1,695,786

(2)	Details of other operating income recognized are as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020					Periods ended June 30, 2019
	Three-month			Six-month		Three-month		Six-month
Gain on transactions of foreign exchange		191,767			269,151		32,083		247,131
Gain related to derivatives (Designated for hedging)		(7,637	)		132,356		65,735		118,154
Others		23,948			32,754		24,458		36,092

Total		208,078			434,261		122,276		401,377

- 105 -

(3)	Details of other operating expenses recognized are as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020				Periods ended June 30, 2019
	Three-month		Six-month		Three-month			Six-month
Losses on transactions of foreign exchange		47,544		464,540		(19,043	)		105,331
KDIC deposit insurance premium		91,319		180,530		82,582			161,719
Contribution to miscellaneous funds		78,335		156,969		78,279			156,059
Losses related to derivatives (Designated for hedging)		8,950		9,324		1,518			1,524
Losses on fair value hedged items		2,322		108,090		52,388			90,198
Others (*)		20,877		61,451		36,020			77,672

Total		249,347		980,904		231,744			592,503

(*)	Other expense includes such expenses amounting to 6,786 million Won and 10,592 million Won, respectively, of intangible asset amortization expense for the six-month period ended June 30, 2020 and 2019, respectively.

(4)	Share-based payment

Details of performance condition share-based payment granted to executives as of June 30, 2020 and December 31, 2019 are as follows.

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		8,215 Won
Valuation method		Black-Scholes Model
Stock price (*1)		8,810 Won
Expected dividend rate		4.13%
Expected maturity date		2.5 years
Number of shares measured as of the closing date (*2)	As of June 30, 2020	602,474 shares
	As of December 31, 2019	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		7,882 Won
Valuation method		Black-Scholes Model
Stock price (*1)		8,810 Won
Expected dividend rate		4.13%
Expected maturity date		3.5 years
Number of shares measured as of the closing date (*2)	As of June 30, 2020	468,378 shares
	As of December 31, 2019	—

(*1)	Closing price of Woori Financial Group Inc. at the end of June.

(*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.

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, 2020 and December 31, 2019, the book value of the liabilities related to the performance condition share-based payments recognized by the Group amounts to 8,644 million Won and 6,328 million Won, respectively.

- 106 -

37.

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, 2020						Periods ended June 30, 2019
	Three-month			Six-month			Three-month			Six-month
Gains on valuation of investments in joint ventures and associates		20,620			35,683			9,650			19,299
Losses on valuation of investments in joint ventures and associates		(3,822	)		(11,731	)		(4,403	)		(8,442	)

Total		16,798			23,952			5,247			10,857

(2)	Details of other non-operating income and expenses recognized are as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020						Periods ended June 30, 2019
	Three-month			Six-month			Three-month			Six-month
Other non-operating incomes		17,890			37,114			36,498			46,936
Other non-operating expenses		(152,712	)		(199,815	)		(15,886	)		(40,123	)

Total		(134,822	)		(162,701	)		20,612			6,813

(3)	Details of other non-operating income recognized are as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020				Periods ended June 30, 2019
	Three-month		Six-month		Three-month		Six-month
Rental fee income		3,996		7,577		1,445		3,442
Gains on disposal of premises and equipment, intangible assets and other assets		126		6,575		578		1,303
Reversal of impairment loss of premises and equipment, intangible assets and other assets		20		55		722		722
Others		13,748		22,907		33,753		41,469

Total		17,890		37,114		36,498		46,936

(4)	Details of other non-operating expenses recognized are as follows (Unit: Korean Won in millions):


	Periods ended June 30, 2020				Periods ended June 30, 2019
	Three-month		Six-month		Three-month		Six-month
Depreciation on investment properties		540		1,087		284		1,298
Operating expenses on investment properties		158		382		175		362
Losses on disposal of premises and equipment, intangible assets and other assets		491		821		712		1,248
Impairment losses of premises and equipment, intangible assets and other assets		7,687		8,254		1,670		1,680
Donation		6,767		11,305		6,680		23,969
Others (*)		137,069		177,966		6,365		11,566

Total		152,712		199,815		15,886		40,123

(*)	Included 165,558 million Won of other special losses related to other provisions for the six-month period ended June 30,2020.

- 107 -

38.

INCOME TAX EXPENSE

(1)	Details of income tax expenses are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30
	2020			2019
Current tax expense:
Current tax expense with respect to the current period		180,059			349,921
Adjustments recognized in the current period in relation to the tax expense of prior periods		(4,292	)		(1,578	)

Sub-total		175,767			348,343

Deferred tax expense
Change in deferred tax assets (liabilities) due to temporary differences		66,044			114,709
Income tax expense directly attributable to equity		18,005			(6,933	)

Sub-total		84,049			107,776

Income tax expense		259,816			456,119

Income tax expense (income) 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, 2020, is 25.1% (The weighted average annual effective tax rate for the June 30, 2019, is 26.4%).

- 108 -

39.

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, 2020						Periods ended June 30, 2019
	Three-month			Six-month			Three-month		Six-month
Net income attributable to common shareholders		142,348			660,564			610,999		1,179,688
Dividends to hybrid securities		(11,852	)		(20,365	)		—		—
Net income attributable to common shareholders		130,496			640,199			610,999		1,179,688
Weighted average number of common shares outstanding		722 shares in million			722 shares in million			680 shares in million		672 shares in million
Basic EPS (Unit: Korean Won)		181			887			899		1,755

(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, 2020
	Period		Number of shares			Dates (Unit: Day)		Accumulated number of shares outstanding during period
Common shares outstanding at the beginning of the period		2020-01-01 ~ 2020-06-30		722,267,681			182		131,452,717,942

Sub-total (①)									131,452,717,942

Weighted average number of common shares outstanding (②=(①/182)									722,267,681


	For the six-month period ended June 30, 2019
	Period		Number of shares			Dates (Unit: Day)		Accumulated number of shares outstanding during period
Common shares issued at the beginning of the period		2019-01-01 ~ 2019-06-30		673,271,226			181		121,862,091,906
Purchase of treasury stock		2019-01-08 ~ 2019-06-30		(11,453,702	)		174		(1,992,944,148	)
Disposal of treasury stock		2019-03-22 ~ 2019-06-30		18,346,782			101		1,853,024,982

Sub-total (①)									121,722,172,740

Weighted average number of common shares outstanding (②=(①/181)									672,498,192

Diluted EPS is equal to basic EPS because there is no dilution effect for the six-month period ended June 30, 2020 and 2019.

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40.

CONTINGENT LIABILITIES AND COMMITMENTS

(1)	Details of guarantees are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Confirmed guarantees
Guarantee for loans		81,339		89,699
Acceptances		638,504		391,688
Guarantees in acceptances of imported goods		216,901		224,746
Other confirmed guarantees		7,747,116		6,982,889

Sub-total		8,683,860		7,689,022

Unconfirmed guarantees
Local letters of credit		186,591		193,096
Letters of credit		2,471,575		3,081,390
Other unconfirmed guarantees		625,271		771,378

Sub-total		3,283,437		4,045,864

Commercial paper purchase commitments and others		822,016		884,031

Total		12,789,313		12,618,917

(2)	Details of unused loan commitments and others are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Loan commitments		106,987,014		103,651,674
Other commitments(*)		9,742,632		5,993,608

(*)	As of June 30, 2020 and 2019, the amount of unsecured bills (purchase note sales) and discounts on electronic short-term bond sales (purchase) are 4,685,491 million Won and 2,582,274 million Won, respectively.

(3)	Litigation case

Legal cases where the Group is involved are as follows (Unit: Korean Won in millions):

June 30, 2020

December 31, 2019

As plaintiff

As defendant

As plaintiff

As defendant

Number of cases (*)

107 cases

451 cases

119 cases

415 cases

Amount of litigation

304,540

425,690

291,880

391,362

Provisions for litigations

27,746

27,029

(*)	The number of lawsuits as of June 30, 2020 and December 31, 2019 do not include fraud lawsuits, etc. and those lawsuits that are filed only to extend the statute of limitation.

(4)	Other commitments

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 112,187 million Won as other financial liabilities for the second sales agreement.

On March 31, 2020, the Financial Services Commission, the Korea Development Bank, the five major financial groups, and 17 forwarding financial institutions and Korea Securities Finance have agreed to create a Together Korea Fund (Securities Market Stabilization Fund) together to cope with the crisis in the securities market. Woori Bank, one of the subsidiaries, invested 100 billion Won on April 9, 2020.

As of June 30, 2020, the Group has entered into an investment agreement with PCC-Woori LP Secondary Fund for 3,100 million Won. Among the agreed amount, 1,550 million Won was executed as of June 31, 2020 and outstanding balance amounts to 1,550 million Won. The contract period is from December 31, 2019 and December 31, 2023.

- 110 -

41.

RELATED PARTY TRANSACTIONS

Related parties of the Group as of June 30, 2020 and December 31, 2019, and assets and liabilities recognized, guarantees and commitments, major transactions with related parties and compensation to key management for the six-month period ended June 30, 2020 and 2019 are as follows:

(1)	Related parties


		Related parties
Associates		W Service Networks Co., Ltd., Korea Credit Bureau Co., Ltd., Korea Finance Security Co., Ltd., LOTTE CARD Co., Ltd, Chin Hung International Inc., 2016KIF-IMM Woori Bank Technology Venture Fund, K BANK Co., Ltd., Well to Sea No. 3 Private Equity Fund, and Others (Dongwoo C & C Co., Ltd. and other 35 associates)

(2)	Assets and liabilities from transactions with related parties are as follows (Unit: Korean Won in millions):


Related parties		A title of account	June 30, 2020			December 31, 2019
Associates	W Service Networks Co., Ltd.	Loans		21			23
		Loss allowance		—			(1	)
		Deposits due to customers		1,913			1,881
		Accrued expenses		6			6
		Other liabilities		501			429
	Korea Credit Bureau Co., Ltd.	Loans		1			3
		Deposits due to customers		1,875			26
	Korea Finance Security Co., Ltd.	Loans		3,939			1,860
		Loss allowance		(9	)		(3	)
		Deposits due to customers		1,566			1,371
		Other liabilities		9			—
	Chin Hung International Inc.	Loans		147			244
		Loss allowance		(1	)		(2	)
		Deposits due to customers		5,256			5,381
		Other liabilities		407			321
	LOTTE CARD Co. Ltd.	Loans		7,500			7,500
		Loss allowance		(90	)		(30	)
		Other assets		19			—
		Deposits due to customers		21,836			2,726
		Other liabilities		52			—
	K BANK Co., Ltd.	Loans		91			141
		Account receivables		33			24
		Other assets		—			4
	Well to Sea No. 3 Private Equity Fund	Loans		71,200			4,490
		Loss allowance		(75	)		(8	)
		Deposits due to customers		3,787			714
		Other liabilities		56			47
	Others (1) (2)	Loans		—			84
		Loss allowance		—			(84	)
		Other assets		740			338
		Deposits due to customers		5,484			5,577
		Other liabilities		162			172

- 111 -

(*1)

Others include Saman Corporation, Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori All-in-One World EMP 40, 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 and etc., as of June 30, 2020.

(*2)	Others include Saman Corporation, Woori-Shinyoung Growth-Cap Private Equity Fund, Uri Hanhwa Eureka Private Equity Fund, Kyesan Engineering Co., Ltd. and DAEA SNC Co., Ltd. and etc., as of December 31, 2019.

(3)	Gain or loss from transactions with related parties are as follows (Unit: Korean Won in millions):


			For the six-month period June 30
Related parties		A title of account	2020			2019
Associates	W Service Network Co., Ltd.	Other income		16			16
		Interest expenses		9			10
		Fees expenses		226			219
		Provisions for (reversal of) allowance for credit loss		(4	)		1
		Other expenses		1,001			645
	Korea Credit Bureau Co., Ltd.	Interest expenses		1			29
		Fees expenses		1,544			1,171
	Korea Finance Security Co., Ltd.	Interest expenses		2			7
		Provisions for (reversal of) allowance for credit loss		6			(2	)
		Other expenses		51			60
	Chin Hung International Inc	Interest expenses		11			16
		Provisions for (reversal of) allowance for credit loss		90			(32	)
	LOTTE CARD Co., Ltd.	Interest income		150			—
		Fees income		1,330			—
		Interest expenses		53			—
	K BANK Co., Ltd.	Fees income		851			619
	Well to Sea No.3 Private Equity Fund	Interest income		1,328			759
		Interest expenses		2			—
		Provision for (reversal of) allowance for credit loss		77			(57	)
	Others (1) (2)	Fees income		1,261			634
		Other income		8			8
		Interest expenses		15			31

(*1)

(*2)	Others include Saman Corporation, Kyesan Engineering Co., Ltd. and DAEA SNC Co., Ltd. and etc., as of December 31, 2019.

- 112 -

(4)	Major loan transactions with related parties for the six-month period ended June 30, 2020 and 2019 are as follows (Unit: Korean Won in millions):


		For the six-month period ended June 30, 2020
Related parties		Beginning balance		Loan		Collection		Ending balance (*)
Associates	Well to Sea No. 3 Private Equity Fund		4,490		66,710		—		71,200
	LOTTE CARD Co., Ltd.		7,500		—		—		7,500
	Korea Finance Security Co., Ltd.		1,860		2,356		277		3,939
	Korea Credit Bureau Co., Ltd.		3		8		10		1
	W Service Network Co., Ltd.		23		190		192		21
	Chin Hung International Inc		244		1,095		1,192		147
	K BANK Co., Ltd.		141		896		946		91

(*)	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, 2019
Related parties		Beginning balance		Loan		Collection		Ending balance (*)
Associates	Well to Sea No. 3 Private Equity Fund		1,857		60,000		367		61,490
	Korea Finance Security Co., Ltd.		57		284		311		30
	Korea Credit Bureau Co., Ltd.		7		14		18		3
	W Service Network Co., Ltd.		69		155		200		24
	Chin Hung International Inc		241		1,038		1,115		164
	K BANK Co., Ltd.		185		1,077		1,163		99

(*)	Payments that occurred for business reasons among related parties are excluded and net increase or decrease was used for limited credit loan.

(5)	Details of changes in major deposits due to customers with related parties for the six-month period June 30, 2020 and 2019 are as follows (Unit: Korean Won in millions):


		For the six-month period ended June 30, 2020
Related parties		Beginning balance		Increase		Decrease		Ending balance (*)
Associates	Saman Corporation		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

(*)	Details of payment between related parties, demand deposit due to customers and etc. are excluded.


		For the six-month period ended June 30, 2019
Related parties		Beginning balance		Increase		Decrease		Ending balance (*)
Associates	Saman Corporation		2,436		84		—		2,520
	W Service Networks Co., Ltd		1,180		280		280		1,180
	Chin Hung International Inc		765		400		400		765
.	Korea Credit Bureau Co., Ltd.		6,000		—		6,000		—
	Partner One Value Up I Private Equity Fund		1,403		1,617		1,403		1,617
	Korea Finance Security Co., Ltd.		535		25		560		—

(*)	Details of payment between related parties, demand deposit due to customers and etc. are excluded.

(6)	There are no major borrowing transactions with related parties for the six-month period ended June 30, 2020 and 2019.

- 113 -

(7)	Guarantees provided to the related parties are as follows (Unit: Korean Won in millions):


Warrantee	June 30, 2020		December 31, 2019		Warranty
Korea Finance Security Co., Ltd.		217		400	Unused loan commitment
Korea Credit Bureau Co., Ltd.		34		32	Unused loan commitment
W Service Network Co., Ltd.		99		177	Unused loan commitment
Chin Hung International Inc.		32,152		32,055	Unused loan commitment
K BANK Co., Ltd.		209		159	Unused loan commitment
Well to Sea No. 3 Private Equity Fund		203,800		210,510	Unused loan commitment
LOTTE CARD Co. Ltd.		150,000		150,000	Unused loan commitment

There no recognized provisions for guarantees provided to the related parties as of June 30, 2020 and December 31, 2019, respectively.

(8)	Amount of derivatives-related commitments with the related parties

Warrantee

June 30, 2020

December 31, 2019

Warranty

Well to Sea No. 3 Private Equity Fund

622,128

584,377

Open interest

(9)	Commitments among related parties

As of June 30, 2020, Group has entered into an investment agreement with PCC-Woori LP Secondary Fund for 3,100 million Won. Among the agreed amount, 1,550 million Won was executed as of June 31, 2020 and outstanding balance amounts to 1,550 million Won. The contract period is from December 31, 2019 and December 31, 2023.

(10)	Compensation for key management is as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30
	2020		2019
Short-term employee salaries		8,084		6,328
Retirement benefit service costs		311		730
Share-based compensation		1,054		1,503

Total		9,449		8,561

Key management includes registered executives and non-registered executives. Outstanding assets from transactions with key management amount to 3,034 million Won and 2,414 million Won, as of June 30, 2020 and December 31, 2019 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 9,745 million Won and 6,543 million Won, respectively, as of June 30, 2020 and December 31, 2019,

- 114 -

42.

LEASES

(1)	The future lease payments under the lease contracts are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Lease payments
Within one year		175,667		161,251
After one year but within five years		224,651		232,985
After five years		34,201		40,698

Total		434,519		434,934

(2)	Total cash outflows from lease are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30
	2020		2019
Total cash outflows from lease		103,985		96,569

(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 period ended June 30
	2020		2019
Lease payments for short-term leases		743		589
Lease payments for which the underlying asset is of low value		274		93

Total		1,017		682

(4)

As mentioned in Note 2, the Group applies a simple method that does not assess whether the rent discount as a direct result of COVID-19 is a lease modification or not. As a result, the amount recognized in profit or loss during the reporting period is KRW 4,608 million to reflect changes in lease payments arising from the discount.

(5)

IFRS Interpretations Committee published its interpretation of ‘Lease Period and Lease Improvement Useful Life’ as of December 16, 2019. The Interpretation Committee discussed a question about how to determine the lease term for cancellable or renewable leases. According to the interpretation, the Group should identify factors to consider extensive economic penalties, and then determine the lease period. Due to large number of lease contracts held by the Group and the varying terms of the contracts, sufficient time is needed to analyze the contract and establish accounting policies. Therefore, the Group is planning to reflect the effect in consolidated financial statements after the effect analysis of changes in accounting policies for the lease term is completed.

- 115 -

Exhibit 99.2

WOORI FINANCIAL GROUP INC.

SEPARATE INTERIM FINANCIAL STATEMENTS

AS OF JUNE 30, 2020 AND FOR THE THREE-MONTH AND SIX-MONTH

PERIODS ENDED JUNE 30, 2020 AND FOR THE THREE-MONTH

PERIOD ENDED JUNE 30, 2019 AND THE PERIOD FROM

JANUARY 11, 2019 (DATE OF INCORPORATION) TO JUNE 30, 2019

WOORI FINANCIAL GROUP INC.


	Page(s)
Report on Review of Separate Interim Financial Statements		1-2

Separate Interim Financial Statements

Separate Interim Statements of Financial Position		4

Separate Interim Statements of Comprehensive Income		5

Separate Interim Statements of Changes in Equity		6

Separate Interim Statements of Cash Flows		7-8

Notes to the Separate Interim Financial Statements		9-43

Report on Review of Separate Interim Financial Statements

English Translation of a Report Originally Issued in Korean

To the Shareholders and the Board of Directors of Woori Financial Group Inc.

Reviewed Financial Statements

We have reviewed the accompanying separate interim financial statements of Woori Financial Group (the “Company”). These financial statements consist of the separate interim statement of financial position of the Company as at June 30, 2020 and the related separate interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2020, and separate interim statements of changes in equity and cash flows for the six-month period ended June 30, 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 separate 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 separate 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 separate interim financial statements based on our review.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe the accompanying separate interim financial statements are not presented fairly, in all material respects, in accordance with Korean IFRS 1034 Interim Financial Reporting.

LOGO

- 1 -

Emphasis of Matters

Without qualifying our conclusion, we draw attention to Note 3 of the financial statements, which indicates that the outbreak of COVID-19 in 2020 may have a negative impact on the Company’s financial condition and results of operations. Our conclusion is not affected by this item.

Other Matters

The separate interim financial statements of comprehensive income for the three-month period ended June 30, 2020, and separate interim statements of comprehensive income, changes in equity and cash flows for the period from January 11, 2019 (date of incorporation) to June 30, 2019, presented herein for comparative purposes, were reviewed by Deloitte Anjin LLC whose report dated August 14, 2019. Based on their review, nothing has come to their attention that causes them to believe the accompanying financial statements do not present fairly, in all material respects, in accordance with Korean IFRS 1034 Interim Financial Reporting.

The separate financial statements of the Company for the year ended December 31, 2019, were audited by Deloitte Anjin LLC who expressed an unqualified opinion on those statements, not presented herein, on March 16, 2020. The separate statement of financial position as at December 31, 2019, presented herein for comparative purposes, is consistent, in all material respects, with the above audited statement of financial position as at December 31, 2019.

/s/ Samil PricewaterhouseCoopers

August 14, 2020

Notice to Readers

This report is effective as of August 14, 2020 the review report date. Certain subsequent events or circumstances may have occurred between the review report date and the time the review report is read. Such events or circumstances could significantly affect the separate interim financial statements and may result in modifications to the review report.

- 2 -

WOORI FINANCIAL GROUP INC.

SEPARATE INTERIM FINANCIAL STATEMENTS

AS OF JUNE 30, 2020 AND FOR THE THREE-MONTH AND SIX-MONTH

PERIODS ENDED JUNE 30, 2020 AND FOR THE THREE-MONTH

PERIOD ENDED JUNE 30, 2019 AND THE PERIOD FROM JANUARY 11, 2019

(DATE OF INCORPORATION) TO JUNE 30, 2019

The accompanying separate interim financial statements including all footnote disclosures

were prepared by, and are the responsibility of, the management of Woori Financial Group Inc.

Tae Seung Sohn

President and Chief Executive Officer

Main Office Address: (Road Name Address) 51, Sogong-ro, Jung-gu, Seoul

(Phone Number) 02-2125-2000

- 3 -

WOORI FINANCIAL GROUP INC.

SEPARATE INTERIM STATEMENTS OF FINANCIAL POSITION

AS OF JUNE 30, 2020 (UNAUDITED) AND DECEMBER 31, 2019


	June 30, 2020			December 31, 2019
	(Korean Won in millions)
ASSETS
Cash and cash equivalents (Notes 5 and 30)		129,525			43,670
Financial assets at fair value through profit or loss (“FVTPL”) (Notes 4, 6, 9 and 18)		9,434			9,434
Financial assets at fair value through other comprehensive income (“FVTOVI”) (Notes 4, 7 and 9)		150,265			—
Loans and other financial assets at amortized cost (Notes 4, 8, 9 and 30)		761,795			1,269,203
Investments in subsidiaries (Notes 10 and 30)		20,873,593			19,873,593
Premises and equipment (Notes 11 and 30)		9,384			7,383
Intangible assets (Note 12)		5,609			3,310
Other assets (Note 13)		15			—

Total assets		21,939,620			21,206,593

LIABILITIES
Debentures (Notes 4, 9 and 14)		947,789			947,679
Provisions (Note 15)		714			600
Net defined benefit liability (Note 16)		7,566			3,482
Current tax liabilities (Note 27)		57,554			133,526
Deferred tax liabilities (Note 27)		921			154
Other financial liabilities (Notes 4, 9, 17, 30 and 31)		9,860			10,745
Other liabilities (Notes 17 and 30)		323			4,142

Total liabilities		1,024,727			1,100,328

EQUITY
Capital stock		3,611,338			3,611,338
Hybrid securities		1,695,821			997,544
Capital surplus		14,874,084			14,874,084
Other equity		(1,400	)		(631	)
Retained earnings		735,050			623,930
Regulatory reserve for credit loss		(692	)		—
Required reversal(provision) of regulatory reserve for credit loss		390			(692	)
Planned reversal(provision) of regulatory reserve for credit loss		390			(692	)

Total equity		20,914,893			20,106,265

Total liabilities and equity		21,939,620			21,206,593

The accompanying notes are part of this interim financial statement.

- 4 -

WOORI FINANCIAL GROUP INC.

SEPARATE INTERIM STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE-MONTH AND SIX-MONTH PERIOD ENDED JUNE 30, 2020 AND FOR

THE THREE-MONTH PERIOD ENDED JUNE 30, 2019

AND THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION)

TO JUNE 30, 2019 (UNAUDITED)


	2020						2019
	For the three-month period ended June 30, 2020			For the six-month period ended June 30, 2020			For the three-month period ended June 30, 2019			For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	(Korean Won in millions, except for per share data)
Interest income		3,185			7,699			482			509
Interest expense		5,495			11,031			684			863

Net interest loss (Notes 9, 21 and 30)		(2,310	)		(3,332	)		(202	)		(354	)
Fees and commissions income		—			—			—			—
Fees and commissions expense		5,529			8,168			3,598			7,412

Net fees and commissions loss (Notes 22 and 30)		(5,529	)		(8,168	)		(3,598	)		(7,412	)
Dividend income (Notes 23 and 30)		—			677,795			676,000			676,000
Reversal of impairment losses due to credit loss (Notes 24 and 30)		9			9			—			—
General and administrative expenses (Notes 25 and 30)		(15,829	)		(28,154	)		(10,075	)		(20,610	)

Operating income (loss)		(23,659	)		638,150			662,125			647,624
Other non-operating expense		180			(20	)		(200	)		(600	)

Non-operating expense (Note 26)		180			(20	)		(200	)		(600	)
Net income (loss) before income tax expense		(23,479	)		638,130			661,925			647,024
Income tax expense (income) (Note 27)		(221	)		1,058			(147	)		(407	)
Net income (loss)
(Net income after the provision of regulatory reserve for credit loss for the six-month period ended June 30, 2020 and the period from January 11, 2019(Date of incorporation) to June 30, 2019 is 637,462 million Won and 646,421 million Won, respectively, and net income after the provision of regulatory reserve for credit loss for the three-month period ended June 30, 2020 and 2019 are (22,774) million Won and 661,062 million Won, respectively) (Note 19)		(23,258	)		637,072			662,072			647,431

Net gain on valuation of equity securities at FVTOCI		192			192			—			—

Remeasurement loss related to defined benefit plan		253			(961	)		(372	)		(445	)

Items that will not be reclassified to profit or loss:		445			(769	)		(372	)		(445	)

Other comprehensive loss, net of tax		445			(769	)		(372	)		(445	)
Total comprehensive income (loss)		(22,813	)		636,303			661,700			646,986

Earnings per share (Note 28)
Basic and diluted earnings per share (In Korean Won)		(49	)		854			974			952

The accompanying notes are part of this interim financial statement.

- 5 -

WOORI FINANCIAL GROUP INC.

SEPARATE INTERIM STATEMENTS OF CHANGES IN EQUITY

FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2020

AND FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION)

TO JUNE 30, 2019 (UNAUDITED)


	Capital stock		Capital surplus			Hybrid securities		Other equity			Retained earnings			Total equity
	(Korean Won in millions)
January 11, 2019 (Date of incorporation)		3,400,822		14,565,637			—		—			—			17,966,459
Total comprehensive income
Net income		—		—			—		—			647,431			647,431
Remeasurement loss related to defined benefit plan		—		—			—		(445	)		—			(445	)
Transactions with owners
New stocks issue cost		—		(2	)		—		—			—			(2	)

June 30, 2019 (Unaudited)		3,400,822		14,565,635			—		(445	)		647,431			18,613,443

January 01, 2020		3,611,338		14,874,084			997,544		(631	)		623,930			20,106,265
Total comprehensive income
Net income		—		—			—		—			637,072			637,072
Net gain on valuation of equity securities at FVTOCI		—		—			—		192			—			192
Remeasurement loss related to defined benefit plan		—		—			—		(961	)		—			(961	)
Transactions with owners
Dividends to common stocks		—		—			—		—			(505,587	)		(505,587	)
Issuance of hybrid securities		—		—			698,277		—			—			698,277
Dividends to hybrid securities		—		—			—		—			(20,365	)		(20,365	)

June 30, 2020 (Unaudited)		3,611,338		14,874,084			1,695,821		(1,400	)		735,050			20,914,893

The accompanying notes are part of this interim financial statement.

- 6 -

WOORI FINANCIAL GROUP INC.

SEPARATE INTERIM STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2020

AND FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION)

TO JUNE 30, 2019 (UNAUDITED)


	For the six-month period ended June 30, 2020			For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	(Korean Won in millions)
Cash flows from operating activities:
Net income		637,072			647,431
Adjustments to net income:
Income tax expense(income)		1,058			(407	)
Interest income		(7,699	)		(509	)
Interest expense		11,031			863
Dividend income		(677,795	)		(676,000	)

		(673,405	)		(676,053	)

Additions of expenses not involving cash outflows:
Retirement benefit		2,204			4,189
Depreciation and amortization		2,513			1,764

		4,717			5,953

Deductions of income not involving cash inflows:
Reversal of impairment losses due to credit loss		9			—

		9			—

Changes in operating assets and liabilities:
Loans and other financial assets at amortized cost		75,816			(16,915	)
Other assets		(15	)		(10	)
Net defined benefit liability		554			—
Other financial liabilities		(77,046	)		(12,177	)
Other liabilities		(3,819	)		405

		(4,510	)		(28,697	)

Interest income received		10,002			29
Interest expense paid		(10,973	)		(455	)
Dividends received		677,795			676,000
Income tax paid		—			—

		676,824			675,574

Net cash provided by operating activities		640,689			624,208

Cash flows from investing activities:
Cash in-flows from investing activities:
Decrease on other investment assets		1,130,000			—

		1,130,000			—

Cash out-flows from investing activities:
Acquisition of investments in subsidiaries		1,000,000			—
Acquisition of financial assets at FVTOCI		150,000			—
Acquisition of premises and equipment		2,626			6,596
Acquisition of intangible assets		2,857			3,919
Increase on guarantee deposits for leases		709			955
Increase on other investment assets		700,000			—

		1,856,192			11,470

Net cash used in investing activities		(726,192	)		(11,470	)

(Continued)

- 7 -

WOORI FINANCIAL GROUP INC.

SEPARATE INTERIM STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2020

AND FOR THE PERIOD FROM JANUARY 11, 2019 (DATE OF INCORPORATION)

TO JUNE 30, 2019 (UNAUDITED) (CONTINUED)


	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	(Korean Won in millions)
Cash flows from financing activities:
Cash in-flows from financing activities:
Increase in borrowings		—		64,769
Issuance of debentures		—		299,144
Issuance of hybrid securities		698,277		—

		698,277		363,913

Cash out-flows from financing activities:
Decrease in borrowings		—		64,769
Redemption of lease liabilities		967		620
New stock issue cost		—		2
Dividends paid to hybrid securities		20,365		—
Dividends paid		505,587		—

		526,919		65,391

Net cash provided by financing activities		171,358		298,522

Net increase in cash and cash equivalents		85,855		911,260
Cash and cash equivalents, beginning of the period		43,670		—

Cash and cash equivalents, end of the period (Note 5)		129,525		911,260

The accompanying notes are part of this interim financial statement.

- 10 -

WOORI FINANCIAL GROUP INC.

NOTES TO SEPARATE INTERIM FINANCIAL STATEMENTS

AS OF JUNE 30, 2020 AND 2019 (UNAUDITED)

1.	GENERAL

(1)	Summary of the parent company

Woori Financial Group, Inc. (hereinafter referred to 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, 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 Company is located at 51, Sogong-ro, Jung-gu, Seoul, Korea, and the capital is 3,611,338 million Won as of June 30, 2020 while the Korea Deposit Insurance Corp. (“KDIC”), the company’s largest shareholder, owns 124,604,797 shares (17.25%) of the 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 from the 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 company acquired a 73% interest in Woori Asset Management Co. (Formerly Tongyang Asset Management Corp.). The remaining payment was completed in August, 2019 after the request for the change of major shareholder was approved by the Financial Service Commission in July, 2019 and the company gained 100% control of Woori Global Asset Management Co., Ltd. (formerly ABL Global Asset Management Co., Ltd), and added it as a consolidated subsidiary at the end of 2019.

The 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 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 company acquired 67.2% interests in Woori Asset Trust Co. (formerly Kukje Asset Trust Co.).

- 9 -

2.	BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES

The Company’s financial statements are interim financial statements prepared in accordance with Korean IFRS 1034, Interim Financial Reporting for some of periods in which the annual separate financial statements belong. They are also separate financial statements prepared in accordance with Korean IFRS 1027 Separate Financial Statements. It is necessary to use the Company’s annual separate financial statements for the year ended December 31, 2019 for understanding of the accompanying interim financial statements.

Except for the impacts on the newly adopted standards and interpretations explained below, the accounting policies applied in preparing the accompanying interim financial statements have been applied consistently with the annual financial statements as of and for the year ended December 31, 2019.

•

Amendments to Korean IFRS 1001 Presentation of Financial Statements and Korean IFRS 1008 Accounting policies, changes in accounting estimates and errors – Definition of Material

The amendments clarify the explanation of the definition of material and amended Korean IFRS 1001 and Korean IFRS 1008 in accordance with the clarified definitions. Materiality is assessed by reference to omission or misstatement of material information as well as effects of immaterial information, and to the nature of the users when determining the information to be disclosed by the Company. The amendment does not have a significant impact on the financial statements.

•

Amendments to Korean IFRS 1103 Business Combination – Definition of a Business

•

Amendments to Korean IFRS 1116 Lease – Practical expedient for COVID-19 Related Rent Exemption, Concessions, Suspension

The amendment permits lessees, as a practical expedient, not to assess whether particular rent concessions occurring as a direct consequence of the COVID-19 pandemic. For those who applied this accounting treatment shall account for changes in lease payments, such as rent discounts, consistently with the way the standard specifies when those changes are not lease changes.

The Company changed its accounting policies in accordance with the amendments made to IFRS 16. The revised accounting policies were applied retrospectively in accordance with the transitional regulation in IFRS 16. The amendments do not have a significant impact on the financial statements.

- 10 -

Significant accounting policies and method of computation used in the preparation of the condensed interim financial statements are consistent with those of the annual financial statements for the year ended December 31, 2019, except for the changes due to the application of amendment and enactments of standards described in Note 2.(1) and the one described below.

•

Income tax expense

3.	SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS

The outbreak of COVID-19 in 2020 has had a significant impact on the global economy including Korea. Financial and economic conditions arising may have a negative impact on the Company’s financial condition and results of operations in various forms both domestically and internationally. The Company is closely monitoring the impact of COVID-19 and assessing its effect on the company as of the end of this quarter.

The management shall make judgements, estimates and assumptions that affect the application of accounting policies and application of assets, liabilities and revenues and expenses in preparing condensed interim financial statements. Therefore, the actual results may differ from these estimates.

The important judgements by the management on accounting policies and the main sources of estimation uncertainty for preparing condensed interim financial statements are identical to ones used in the Company’s annual separate financial statements for the year ended December 31, 2019, except for the methods of estimation used to determine income tax expense.

4.	RISK MANAGEMENT

The Company is exposed to various risks that may arise from its operating activities and credit risk, market risk and liquidity risk are the main types of risks. In order to manage such risks, the Risk Management Committee analyzes, assesses, and establishes risk management standards, including policies, guidelines, management systems and decision-making to ensure sound management of the Group.

The Risk Management Committee, Chief Risk Officer (“CRO”) and the Risk Management Department are operated as risk management organizations. The board of directors operates the Risk Management Committee, composed of nonexecutive directors for professional risk management. The Risk Management Committee performs as the top decision-making body for risk management by establishing fundamental risk management policies that are consistent with the Group’s management strategy and by determining the Group’s acceptable level of risk.

CRO assists the Risk Management Committee and operates the Group Risk Management Council, which is composed of the risk management managers of the subsidiaries, to periodically check and improve the external environment and the Group’s risk burden. The Risk Management Department which is independently structured, controls the risk management matter of the Group and reports key risks and assists decision-making.

- 11 -

(1)	Credit risk

Credit risk represents the possibility of financial losses incurred when the counterparty fails to fulfill its contractual obligations. The goal of credit risk management is to maintain the Company’s credit risk exposure to a permissible degree and to optimize its rate of return considering such credit risk.

1) Credit risk management

The Company measures expected loss on assets subject to credit risk management and uses it as a management indicator.

2) Maximum exposure to credit risk

The maximum exposure to credit risk is as follows (Unit: Korean Won in millions):


		June 30, 2020		December 31, 2019
Loans and other financial assets at amortized cost	Banks		737,914		1,228,918
	Corporates		23,881		40,285

	Sub-total		761,795		1,269,203

Financial assets at FVTPL	Derivative assets		9,434		9,434

	Total		771,229		1,278,637

a) Credit risk exposure by geographical areas

The following tables analyze credit risk exposure by geographical areas (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
	Korea		Korea
Loans and other financial assets at amortized cost		761,795		1,269,203
Financial assets at FVTPL		9,434		9,434

Total		771,229		1,278,637

b) Credit risk exposure by industries

The following tables analyze credit risk exposure by industries, which are finance and insurance, and others in accordance with the Korea Standard Industrial Classification Code as of June 30, 2020 and December 31, 2019 (Unit: Korean Won in millions):


	June 30, 2020
	Finance and insurance		Others		Total
Loans and other financial assets at amortized cost		760,118		1,677		761,795
Financial assets at FVPTL		9,434		—		9,434

Total		769,552		1,677		771,229


	December 31, 2019
	Finance and insurance		Others		Total
Loans and other financial assets at amortized cost		1,267,228		1,975		1,269,203
Financial assets at FVPTL		9,434		—		9,434

Total		1,276,662		1,975		1,278,637

- 12 -

3) Credit risk exposure

The maximum exposure to credit risk by asset quality, except for financial assets at FVTPL as of June 30, 2020 and December 31, 2019 is as follows (Unit: Korean Won in millions):


	June 30, 2020
	Stage 1				Stage 2				Stage 3		Total		Loss allowance			Total, net
Financial assets	Above appropriate credit rating (*1)		Less than a limited credit rating (*3)		Above appropriate credit rating (*2)		Less than a limited credit rating (*3)		Stage 3		Total		Loss allowance			Total, net
Loans and other financial assets at amortized cost		762,049		—		—		—		—		762,049		(254	)		761,795
Banks		738,168		—		—		—		—		738,168		(254	)		737,914
Corporates		23,881		—		—		—		—		23,881		—			23,881
General business		23,881		—		—		—		—		23,881		—			23,881

Total		762,049		—		—		—		—		762,049		(254	)		761,795

(*1)	Credit grade of corporates are AAA ~ BBB.

(*2)	Credit grade of corporates are A- ~ BBB.

(*3)	Credit grade of corporates are BBB- ~ C.


	December 31, 2019
	Stage 1				Stage 2				Stage 3		Total		Loss allowance			Total, net
Financial assets	Above appropriate credit rating (*1)		Less than a limited credit rating (*3)		Above appropriate credit rating (*2)		Less than a limited credit rating (*3)		Stage 3		Total		Loss allowance			Total, net
Loans and other financial assets at amortized cost		1,269,466		—		—		—		—		1,269,466		(263	)		1,269,203
Banks		1,229,181		—		—		—		—		1,229,181		(263	)		1,228,918
Corporates		40,285		—		—		—		—		40,285		—			40,285
General business		40,285		—		—		—		—		40,285		—			40,285

Total		1,269,466		—		—		—		—		1,269,466		(263	)		1,269,203

(*1)	Credit grade of corporates are AAA ~ BBB.

(*2)	Credit grade of corporates are A- ~ BBB.

(*3)	Credit grade of corporates are BBB- ~ C.

- 13 -

(2)	Market risk

The Company 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, 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 (*1)		530,191		300,600		—		—		—		—		830,791
Financial assets at FVTOCI (*2)		—		—		—		—		—		150,265		150,265
Sub-total		530,191		300,600		—		—		—		150,265		981,056
Liability:
Debentures		5,486		5,486		5,486		5,487		87,780		1,038,890		1,148,615

	December 31, 2019
	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 (*1)		445,070		733,330		—		—		—		—		1,178,400
Liability:
Debentures		5,486		5,486		5,486		5,487		87,780		1,049,863		1,159,588

(*1)	The principal and interest cash flows of cash and cash equivalents are included in the cash flows within three months, with 129,558 million Won and 43,670 million Won as of June 30, 2020 and December 31, 2019, respectively.

(*2)	Due to the uncertain timing of the sale, it is included in the section for over 5 years in accordance with the expiration of the remaining contract

(3)	Liquidity risk

Liquidity risk refers to the risk that the Company may encounter difficulties in meeting obligations from its financial liabilities.

Liquidity risk management

Liquidity risk management is to prevent damages from potential liquidity shortages with effective risk management that could arise from mismatching the assets and liabilities or unexpected cash outflows. The financial liabilities in the statement of financial position that are relevant to liquidity risk are incorporated within the scope of risk management.

The Company 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.).

- 14 -

Maturity analysis of non-derivative financial liabilities

Cash flows of principals and interests by remaining contractual maturities of non-derivative financial liabilities are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Within 3 months		4 to 6 months		7 to 9 months		10 to 12 months		1 to 5 years		Over 5 years		Total
Debentures		5,486		5,486		5,486		5,487		87,780		1,038,890		1,148,615
Lease liabilities		589		594		174		94		385		—		1,836
Other financial liabilities		4,657		342		—		1,715		1,329		—		8,043

Total		10,732		6,422		5,660		7,296		89,494		1,038,890		1,158,494


	December 31, 2019
	Within 3 months		4 to 6 months		7 to 9 months		10 to 12 months		1 to 5 years		Over 5 years		Total
Debentures		5,486		5,486		5,486		5,487		87,780		1,049,863		1,159,588
Lease liabilities		335		335		335		336		249		—		1,590
Other financial liabilities		6,131		2,043		—		183		820		—		9,177

Total		11,952		7,864		5,821		6,006		88,849		1,049,863		1,170,355

Cash flows of principals and interests by expected maturities of non-derivative financial liabilities are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Within 3 months		4 to 6 months		7 to 9 months		10 to 12 months		1 to 5 years		Over 5 years		Total
Debentures		5,486		5,486		5,486		5,487		87,780		1,038,890		1,148,615
Lease liabilities		589		594		174		94		385		—		1,836
Other financial liabilities		4,657		342		—		1,715		1,329		—		8,043

Total		10,732		6,422		5,660		7,296		89,494		1,038,890		1,158,494


	December 31, 2019
	Within 3 months		4 to 6 months		7 to 9 months		10 to 12 months		1 to 5 years		Over 5 years		Total
Debentures		5,486		5,486		5,486		5,487		87,780		1,049,863		1,159,588
Lease liabilities		335		335		335		336		249		—		1,590
Other financial liabilities		6,131		2,043		—		183		820		—		9,177

Total		11,952		7,864		5,821		6,006		88,849		1,049,863		1,170,355

- 15 -

5.	STATEMENTS OF CASH FLOWS

(1)	Details of cash and cash equivalents are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Demand deposits		79,525		43,670
Fixed deposits		50,000		—

Total		129,525		43,670

(2)	Significant transactions of investing activities and financing activities not involving cash inflows and outflows are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Changes in other comprehensive income related to valuation of financial assets at FVTOCI		192		—
Increase in account payables related to acquisition of premises and equipment		8		—
Increase in account payables related to acquisition of intangible assets		10		—
Changes in right-of-use assets due to new contract		1,311		3,409
Changes in lease liabilities due to new contract		1,197		2,782
Comprehensive stock transfer		—		17,982,783

6.	FINANCIAL ASSETS AT FVTPL

(1)	Details of financial assets at FVTPL as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Financial assets at fair value through profit or loss mandatorily measured at fair value		9,434		9,434

(2)	Financial assets at fair value through profit or loss mandatorily measured at fair value are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Derivatives assets		9,434		9,434

(3)	Financial assets at FVTPL designated as upon initial recognition is nil among financial assets at FVTPL as of June 30, 2020 and December 31, 2019.

7.	FINANCIAL ASSETS AT FVTOCI

(1)	Details of financial assets at FVTOCI as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Hybrid securities		150,265		—

(2)	Details of equity securities designated as financial assets at FVTOCI as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


Purpose of acquisition	June 30, 2020		December 31, 2019
Investment for political purpose		150,265		—

- 16 -

8.	LOANS AND OTHER FINANCIAL ASSETS AT AMORTIZED COST

(1)	Details of loans and other financial assets at amortized cost as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Due from banks		699,746		1,129,738
Other financial assets		62,049		139,465

Total		761,795		1,269,203

(2)	Details of due from banks are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Due from banks in local currency:
Due from depository banks		700,000			1,130,000
Loss allowance		(254	)		(262	)

Total		699,746			1,129,738

(3)	Changes in the allowance for credit losses and gross carrying amount of due from banks are as follows and it is not applicable for June 30, 2019. (Unit: Korean Won in millions):

Allowance for credit losses


	For the six-month period ended June 30, 2020
	Stage 1			Stage 2		Stage 3		Total
Beginning balance		(262	)		—		—		(262	)
Transfer to 12-month expected credit losses		—			—		—		—
Transfer to lifetime expected credit losses		—			—		—		—
Transfer to credit-impaired financial assets		—			—		—		—
Reversal of allowance for credit loss		8			—		—		8

Ending balance		(254	)		—		—		(254	)

Gross carrying amount


	For the six-month period ended June 30, 2020
	Stage 1			Stage 2		Stage 3		Total
Beginning balance		1,130,000			—		—		1,130,000
Transfer to 12-month expected credit losses		—			—		—		—
Transfer to lifetime expected credit losses		—			—		—		—
Transfer to credit-impaired financial assets		—			—		—		—
Net increase (decrease)		(430,000	)		—		—		(430,000	)

Ending balance		700,000			—		—		700,000

- 17 -

(4)	Details of other financial assets are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Receivables		59,075		134,891
Accrued income		1,326		3,641
Lease deposits		1,648		934
Allowance for credit losses		—		(1	)

Total		62,049		139,465

(5)	Changes in the allowances for credit losses and gross carrying amount of other financial assets are as follows and it is not applicable for June 30, 2019. (Unit: Korean Won in millions).

Allowance for credit losses


	For the six-month period ended June 30, 2020
	Stage 1			Stage 2		Stage 3		Total
Beginning balance		(1	)		—		—		(1	)
Transfer to 12-month expected credit losses		—			—		—		—
Transfer to lifetime expected credit losses		—			—		—		—
Transfer to credit-impaired financial assets		—			—		—		—
Reversal of allowance for credit loss		1			—		—		1

Ending balance		—			—		—		—

Gross carrying amount


	For the six-month period ended June 30, 2020
	Stage 1			Stage 2		Stage 3		Total
Beginning balance		139,466			—		—		139,466
Transfer to 12-month expected credit losses		—			—		—		—
Transfer to lifetime expected credit losses		—			—		—		—
Transfer to credit-impaired financial assets		—			—		—		—
Net increase (decrease)		(77,417	)		—		—		(77,417	)

Ending balance		62,049			—		—		62,049

- 18 -

9.	FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

(1)	The fair value hierarchy

The fair value hierarchy is determined by the levels of judgment involved in estimating fair values of financial assets and liabilities. The specific financial instruments characteristics and market condition such as volume of transactions 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 Company 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 Company’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:

•

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 Company’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.

(2)	Fair value hierarchy of financial assets and liabilities measured at fair value are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Level 1		Level 2		Level 3		Total
Financial assets:
Financial assets at FVTPL
Derivative assets		—		—		9,434		9,434
Financial assets at FVTOCI
Hybrid securities		—		—		150,265		150,265

December 31, 2019

Level 1

Level 2

Level 3

Total

Financial assets:

Financial assets at FVTPL

Derivative assets

—

9,434

Financial assets measured at FVTPL 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.

- 19 -

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 Company determines the fair value using valuation methods. Valuation methods and input variables for each type of financial instruments are as follows:


	Valuation methods	Input variables
Derivatives	The fair value is measured considering the price and volatility of the underlying assets using the Binomial Tree, a commonly used technique in the market	Values of underlying assets, volatility, risk-free market return, corporate bond yield rate
Hybrid securities	The fair value is measured using the Monte Carlo Simulations and the Hull-White model	YTM Matrix, Additive spread by grade, Risk spread by entity, Effective Credit rating, Issuing information by item, Interest rate volatility estimate

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 measurement technique	Type	Significant unobservable inputs	Range	Impact of changes in significant unobservable inputs on fair value measurement
Derivative assets	Option valuation model and others	Equity related	Value of underlying assets and volatility	12.58%~15.38%	Variation of fair value increases as value of underlying assets and volatility increases.
Hybrid securities	Hull and White model and others	Hybrid securities related	Interest rate (YTM)	Interest rate 0.48%~1.61% Market rate 1.80%~4.40%	Variation of fair value increases as variation of interest rate (YTM) increases.

The fair value of financial assets classified as level 3 uses external valuation figures.

(3)	Changes in financial assets and liabilities measured at fair value classified into Level 3 are as follows and it is not applicable for June 30, 2019. (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020
	Beginning balance		Net Income (loss)		Other comprehensive income		Purchases/ issuances		Disposals/ settlements		Transfer to or out of Level 3		Ending balance
Financial assets:
Financial assets at FVTPL
Derivative assets		9,434		—		—		—		—		—		9,434
Financial assets at FVTOCI
Hybrid securities		—		—		265		150,000		—		—		150,265

(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 on financial instruments shows how changes in unobservable inputs affect changes in fair value of the instruments through favorable and unfavorable changes. 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 equity related derivatives of which fair value changes are recognized as net income and hybrid securities of which fair value changes are recognized as other comprehensive income among level 3 financial instruments.

- 20 -

The following table presents the sensitivity analysis to disclose the effect of reasonably possible volatility on the fair value of a Level 3 financial instruments (Unit: Korean Won in millions):


	June 30, 2020
	Net income (loss)					Other comprehensive income (loss)
	Favorable		Unfavorable			Favorable		Unfavorable
Financial assets:
Financial assets at FVTPL
Derivative assets (*1)		943		(943	)		—		—
Financial assets at FVTOCI
Hybrid securities (*2)		—		—			7,399		(7,050	)

(*1)	Fair value changes of equity related derivatives are calculated by increasing or decreasing stock price volatility rate of underlying assets and correlation, which are major unobservable variables, by 10%, respectively.

(*2)	Fair value changes of hybrid securities are calculated by increasing or decreasing market rate, which is the major unobservable variable, by 1%, respectively.


	December 31, 2019
	Net income (loss)
	Favorable		Unfavorable
Financial assets:
Financial assets at fair value through profit or loss mandatorily measured at fair value
Derivative assets (*)		943		(943	)

(*)	Fair value changes of equity related derivatives are calculated by increasing or decreasing stock price volatility rate of underlying assets and correlation, which are major unobservable variables, by 10%, respectively.

(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, 2020
	Fair value								Carrying amount
	Level 1		Level 2		Level 3		Total		Carrying amount
Financial assets:
Loans and other financial assets at amortized cost (*)		—		—		761,795		761,795		761,795
Financial liabilities:
Debentures		—		1,001,613		—		1,001,613		947,789
Other financial liabilities (*)		—		—		9,860		9,860		9,860

(*)	The carrying amount is disclosed at fair value considering the carrying amount as an approximation of fair value.


	December 31, 2019
	Fair value								Carrying amount
	Level 1		Level 2		Level 3		Total		Carrying amount
Financial assets:
Loans and other financial assets at amortized cost (*)		—		—		1,269,203		1,269,203		1,269,203
Financial liabilities:
Debentures		—		951,387		—		951,387		947,679
Other financial liabilities (*)		—		—		10,745		10,745		10,745

(*)	The carrying amount is disclosed at fair value considering the carrying amount as an approximation of fair value.

- 21 -

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 company determines the fair value using valuation methods. For the disclosed items in which book value is considered to be the approximate value of fair value, valuation techniques and input variables are not disclosed. Valuation techniques and input variables for the fair value of financial assets and liabilities that are recorded at amortized cost are as follows:


	Valuation methods	Input variables
Debentures	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 Company.	Risk-free market rate, etc.

(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, 2020
Financial assets	Financial assets at FVTPL		Financial assets at FVTOCI		Financial assets at amortized cost		Total
Deposits		—		—		699,746		699,746
Hybrid securities		—		150,265		—		150,265
Derivative assets		9,434		—		—		9,434
Other financial assets		—		—		62,049		62,049

Total		9,434		150,265		761,795		921,494


	December 31, 2019
Financial assets	Financial assets at FVTPL		Financial assets at amortized cost		Total
Deposits		—		1,129,738		1,129,738
Derivative assets		9,434		—		9,434
Other financial assets		—		139,465		139,465

Total		9,434		1,269,203		1,278,637


	June 30, 2020		December 31, 2019
Financial liabilities	Financial liabilities at amortized cost		Financial liabilities at amortized cost
Debentures		947,789		947,679
Other financial liabilities		8,043		10,745

Total		955,832		958,424

- 22 -

(7)	Income or expense from financial instruments by category

Income or expense from financial assets and liabilities by each category for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019 are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020
	Interest Income (expense)			Reversal (Provision) of credit loss		Others		Total
Loans and other financial assets at amortized cost (*1)		7,699			9		—		7,708
Financial liabilities at amortized cost (*2)		(11,013	)		—		—		(11,013	)

Total		(3,314	)		9		—		(3,305	)

(*1)	2,692 million won interest income of cash and cash equivalents are included.

(*2)	7 million won interest expense of asset retirement obligation is included.


	For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	Interest Income (expense)			Reversal (Provision) of credit loss		Others		Total
Loans and other financial assets at amortized cost (*1)		509			—		—		509
Financial liabilities at amortized cost (*2)		(863	)		—		—		(863	)

Total		(354	)		—		—		(354	)

(*1)	500 million won interest income of cash equivalents is included.

(*2)	6 million won interest expense of asset retirement obligation is included.

10.

INVESTMENTS IN SUBSIDIARIES

(1)	Details of Investments in subsidiaries are as follows (Unit: Korean Won in millions and number of shares):


Subsidiaries	Location		Capital stock		Main business
Woori Bank		Korea		3,581,400	Finance
Woori Card Co., Ltd.		Korea		896,300	Finance
Woori Investment Bank Co., Ltd.		Korea		337,100	Other credit finance
Woori FIS Co., Ltd.		Korea		24,500	System software development & maintenance
Woori Finance Research Institute Co., Ltd.		Korea		3,000	Other service business
Woori Credit Information Co., Ltd.		Korea		5,000	Credit information
Woori Fund Service Co., Ltd.		Korea		10,000	Finance
Woori Asset Trust Co., Ltd		Korea		15,300	Finance
Woori Asset Management Corp.		Korea		20,000	Finance
Woori Private Equity Asset Management Co., Ltd.		Korea		30,000	Finance
Woori Global Asset Management Co., Ltd.		Korea		20,000	Finance

- 23 -


	June 30, 2020					December 31, 2019
Subsidiaries (*1)	Number of shares		Percentage of ownership (%)(*2)		Financial statements date of use	Number of shares		Percentage of ownership (%)(*2)		Financial statements date of use
Woori Bank		716,000,000		100.0	June 30, 2020		676,000,000		100.0	December 31,2019
Woori Card Co., Ltd.		179,266,200		100.0	June 30, 2020		179,266,200		100.0	December 31,2019
Woori Investment Bank Co., Ltd.		403,404,538		59.8	June 30, 2020		403,404,538		59.8	December 31,2019
Woori FIS Co., Ltd.		4,900,000		100.0	June 30, 2020		4,900,000		100.0	December 31,2019
Woori Finance Research Institute Co., Ltd.		600,000		100.0	June 30, 2020		600,000		100.0	December 31,2019
Woori Credit Information Co., Ltd.		1,008,000		100.0	June 30, 2020		1,008,000		100.0	December 31,2019
Woori Fund Service Co., Ltd.		2,000,000		100.0	June 30, 2020		2,000,000		100.0	December 31,2019
Woori Asset Trust Co., Ltd		1,560,000		67.2	June 30, 2020		1,560,000		67.2	December 31,2019
Woori Asset Management Corp.		2,920,000		73.0	June 30, 2020		2,920,000		73.0	December 31,2019
Woori Private Equity Asset Management Co., Ltd.		6,000,000		100.0	June 30, 2020		6,000,000		100.0	December 31,2019
Woori Global Asset Management Co., Ltd.		4,000,000		100.0	June 30, 2020		4,000,000		100.0	December 31,2019

(*1)	Only subsidiaries invested directly by the company are included.

(*2)	The percentage is based on the effective shareholding rate relative to the number of stocks outstanding.

(2)	Changes in the carrying value of investments in subsidiaries are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020
	Beginning balance		Acquisition		Disposal		Ending balance
Woori Bank		17,921,151		1,000,000		—		18,921,151
Woori Card Co., Ltd.		1,118,367		—		—		1,118,367
Woori Investment Bank Co., Ltd.		392,795		—		—		392,795
Woori FIS Co., Ltd.		21,754		—		—		21,754
Woori Finance Research Institute Co., Ltd.		1,677		—		—		1,677
Woori Credit Information Co., Ltd.		16,466		—		—		16,466
Woori Fund Service Co., Ltd.		13,939		—		—		13,939
Woori Asset Trust Co., Ltd		224,198		—		—		224,198
Woori Asset Management Corp.		122,449		—		—		122,449
Woori Private Equity Asset Management Co., Ltd.		7,797		—		—		7,797
Woori Global Asset Management Co., Ltd.		33,000		—		—		33,000

Total		19,873,593		1,000,000		—		20,873,593


	For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	Beginning balance (date of incorporation)		Acquisition		Disposal		Ending balance
Woori Bank (*)		17,921,151		—		—		17,921,151
Woori FIS Co., Ltd. (*)		21,754		—		—		21,754
Woori Finance Research Institute Co., Ltd. (*)		1,677		—		—		1,677
Woori Credit Information Co., Ltd. (*)		16,466		—		—		16,466
Woori Fund Service Co., Ltd. (*)		13,939		—		—		13,939
Woori Private Equity Asset Management Co., Ltd. (*)		7,797		—		—		7,797

Total		17,982,784		—		—		17,982,784

(*)	Acquired by the comprehensive stock transfer at the date of incorporation.

- 24 -

11.

PREMISES AND EQUIPMENT

(1)	Details of premises and equipment as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Building		Properties for business use		Leasehold improvements		Asset under construction		Total
Premises and equipment(owned)		—		4,133		3,324		7		7,464
Right-of-use asset		1,209		711		—		—		1,920

Total		1,209		4,844		3,324		7		9,384


	December 31, 2019
	Building		Properties for business use		Leasehold improvements		Total
Premises and equipment(owned)		—		3,767		1,796		5,563
Right-of-use asset		1,436		384		—		1,820

Total		1,436		4,151		1,796		7,383

(2)	Details of premises and equipment (owned) as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Properties for business use			Leasehold improvements			Asset under construction		Total
Acquisition cost		5,383			3,967			7		9,357
Accumulated depreciation		(1,250	)		(643	)		—		(1,893	)

Net carrying amount		4,133			3,324			7		7,464


	December 31, 2019
	Properties for business use			Leasehold improvements			Total
Acquisition cost		4,538			2,184			6,722
Accumulated depreciation		(771	)		(388	)		(1,159	)

Net carrying amount		3,767			1,796			5,563

(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, 2020
	Properties for business use			Leasehold improvements			Asset under construction		Total
Beginning balance		3,767			1,797			—		5,564
Acquisition		845			1,782			7		2,634
Depreciation		(479	)		(255	)		—		(734	)

Ending balance		4,133			3,324			7		7,464


	For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	Properties for business use			Leasehold improvements			Total
Beginning balance		—			—			—
Acquisitions		4,412			2,184			6,596
Depreciation		(326	)		(169	)		(495	)

Ending balance		4,086			2,015			6,101

- 25 -

(4)	Details of right-of-use assets as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Building			Properties for business use			Total
Acquisition cost		3,704			1,047			4,751
Accumulated depreciation		(2,495	)		(336	)		(2,831	)

Net carrying amount		1,209			711			1,920


	December 31, 2019
	Building			Properties for business use			Total
Acquisition cost		2,871			568			3,439
Accumulated depreciation		(1,435	)		(184	)		(1,619	)

Net carrying amount		1,436			384			1,820

(5)	Details of changes in right-of-use assets for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019 are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020
	Building			Properties for business use			Total
Beginning balance		1,436			384			1,820
New contracts		833			478			1,311
Depreciation		(1,060	)		(151	)		(1,211	)

Ending balance		1,209			711			1,920


	For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	Building			Properties for business use			Total
Beginning balance		—			—			—
New contracts		2,871			538			3,409
Depreciation		(718	)		(89	)		(807	)

Ending balance		2,153			449			2,602

12.

INTANGIBLE ASSETS

(1)	Details of intangible assets are as follows (Unit: Korean Won in millions):


	June 30, 2020
	Software			Development cost			Membership deposit		Construction in progress		Total
Acquisition cost		2,999			2,116			2,371		10		7,496
Accumulated amortization		(1,518	)		(369	)		—		—		(1,887	)

Net carrying amount		1,481			1,747			2,371		10		5,609


	December 31, 2019
	Software			Development cost			Total
Acquisition cost		2,729			1,901			4,630
Accumulated amortization		(1,144	)		(176	)		(1,320	)

Net carrying amount		1,585			1,725			3,310

- 26 -

(2)	Details of changes in intangible assets are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020
	Software			Development cost			Membership deposit		Construction in progress		Total
Beginning balance		1,585			1,725			—		—		3,310
Acquisitions		270			216			2,371		10		2,867
Amortization		(374	)		(194	)		—		—		(568	)

Ending balance		1,481			1,747			2,371		10		5,609


	For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	Software			Development Cost			Construction in progress		Total
Beginning balance		—			—			—		—
Acquisitions		2,728			266			925		3,919
Amortization		(449	)		(13	)		—		(462	)

Ending balance		2,279			253			925		3,457

13.

OTHER ASSETS

Details of other assets are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Prepaid expenses		15		—

14.

DEBENTURES

Details

of debentures are as follows (Unit: Korean Won in millions):

June 30, 2020

December 31, 2019

Interest rate (%)

Amount

Interest rate (%)

Amount

Face value of bonds:

Subordinated bonds

2.13 ~ 2.55

950,000

2.13 ~ 2.55

950,000

Deducted item:

Discounts on bonds

(2,211

)

(2,321

)

Total

947,789

947,679

- 27 -

15.

PROVISIONS

(1)	Details of provisions are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Asset retirement obligation		714		600

(2)	Changes in asset retirement obligation are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Beginning balance		600		—
Increase		108		588
Amortization		6		6

Ending balance		714		594

16.

NET DEFINED BENEFIT LIABILITY

The Company’s pension plan is based on the defined benefit retirement pension plan. 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 Company 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, 2020			December 31, 2019
Present value of defined benefit obligation		21,872			14,174
Fair value of plan assets		(14,306	)		(10,692	)

Net defined benefit liability		7,566			3,482

- 28 -

(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, 2020			For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Beginning balance		14,174			—
Transfer-in / out		4,246			7,315
Recruit / Transfer in		1,266			3,360
Current service cost		906			746
Interest cost		166			126
Remeasurements
Financial assumption		255			476
Demographic assumptions		—			—
Experience adjustment		1,024			124
Retirement benefit paid		(93	)		—
Others		(72	)		—

Ending balance		21,872			12,147

(3)	Changes in the plan assets are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020			For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Beginning balance		10,692			—
Transfer-in / out		3,673			7,315
Interest income		134			43
Remeasurements		(46	)		(12	)
Retirement benefit paid		(147	)		—

Ending balance		14,306			7,346

(4)

Plan assets wholly consist of fixed deposits as of June 30, 2020 and December 31, 2019. Among plan assets, realized returns on plan assets amount to 88 million Won and 31 million Won for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019, respectively.

(5)	The amount recognized in profit or loss and total comprehensive income related to the defined benefit plan for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019 is as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Current service cost		906		746
Recruit/Transfer in		1,266		3,360
Net interest expense (Income)		32		83

Cost recognized in net income		2,204		4,189

Remeasurements (*)		1,326		612

Cost recognized in total comprehensive income		3,530		4,801

(*)	The amount is before income tax expense effect.

- 29 -

17.

OTHER FINANCIAL LIABILITIES AND OTHER LIABILITIES

Other financial liabilities and other liabilities are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Other financial liabilities:
Accounts payable		694		2,424
Accrued expenses		7,137		6,651
Lease liabilities		1,817		1,568
Other miscellaneous financial liabilities		212		102

Sub-total		9,860		10,745

Other liabilities:
Other miscellaneous liabilities		323		4,142

Total		10,183		14,887

18.

DERIVATIVES

Derivative assets and derivative liabilities are as follows (Unit: Korean Won in millions):

June 30, 2020

December 31, 2019

Nominal
amount

Assets
For trading

Nominal
amount

Assets
For trading

Equity Forwards

117,535

9,434

117,535

9,434

Derivatives held for trading are classified into financial assets at FVTPL in the statements of financial position (seeing Note 6).

- 30 -

19.

EQUITY

(1)	Details of equity as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korean Won in millions):


	June 30, 2020			December 31, 2019
Capital		3,611,338			3,611,338
Hybrid securities		1,695,821			997,544
Capital surplus		14,874,084			14,874,084
Accumulated other comprehensive income		(1,400	)		(631	)
Retained earnings		735,050			623,930

Total		20,914,893			20,106,265

(2)	The number of authorized shares and others of the Company are as follows:


	June 30, 2020		December 31, 2019
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, 2020			December 31, 2019
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			—
Securities in local currency		2020-06-12		—		3.23		300,000			—
Issuance cost								(4,179	)		(2,456	)

Total								1,695,821			997,544

The hybrid securities mentioned above do not have maturity date but are redeemable after 5 years from the 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, 2020
	Beginning balance			Increase (decrease)			Income tax effect			Ending balance
Net gain (loss) on valuation of financial assets at FVTOCI		—			265			(73	)		192
Remeasurement loss related to defined benefit plan		(631	)		(1,326	)		365			(1,592	)

Total		(631	)		(1,061	)		292			(1,400	)


	For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	Beginning balance		Increase (decrease)			Income tax effect		Ending balance
Remeasurement loss related to defined benefit plan		—		(612	)		167		(445	)

- 31 -

(5)	Regulatory Reserve for Credit Loss

In accordance with Article 26 ~ 28 of the Financial holding company Supervision Regulations, the Company calculates and discloses the regulatory reserve for credit loss.

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, 2020			December 31, 2019
Beginning balance		692			—
Planned provision of regulatory reserve (reversal) for credit loss		(390	)		692

Ending balance		302			692

Provision of regulatory reserve for credit loss, adjusted net income after the provision of regulatory reserve and others


	2020						2019
	For the three- month period ended June 30, 2020			For the six- month period ended June 30, 2020			For the three- month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Net income before regulatory reserve		(23,258	)		637,072			662,072		647,431
Provision(reversal) of regulatory reserve for credit loss		(484	)		(390	)		1,010		1,010
Adjusted net income after the provision of regulatory reserve		(22,774	)		637,462			661,062		646,421
Dividends to hybrid securities		(11,853	)		(20,365	)		—		—
Adjusted net income after regulatory reserve and dividends to hybrid securities		(34,627	)		617,097			661,062		646,421
Adjusted EPS after regulatory reserve and dividends to hybrid securities (Unit: Korean Won)		(48	)		855			972		951

20.

DIVIDENDS

Dividends per share and the total dividends for the fiscal year ending December 31, 2019 were 700 Won and 505,587 million Won, respectively, approved at the regular general shareholders’ meeting held on March 25, 2020.

- 32 -

21.

NET INTEREST INCOME

(1)	Interest income recognized is as follows (Unit: Korean Won in millions):


	2020				2019
	For the three- month period ended June 30, 2020		For the six- month period ended June 30, 2020		For the three- month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Interest on due from banks		3,177		7,686		477		500
Other interest income		8		13		5		9

Total		3,185		7,699		482		509

(2)	Details of interest expense recognized are as follows (Unit: Korean Won in millions):


	2020				2019
	For the three- month period ended June 30, 2020		For the six- month period ended June 30, 2020		For the three- month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Interest on borrowings		—		—		330		495
Interest on debentures		5,481		11,007		338		338
Other interest expense		4		6		3		6
Interest on lease liabilities		10		18		13		24

Total		5,495		11,031		684		863

22.

NET FEES AND COMMISSIONS INCOME

(1)	There are no fees and commissions income recognized for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019.

(2)	Details of fees and commissions expense incurred are as follows (Unit: Korean Won in millions):


	2020				2019
	For the three- month period ended June 30, 2020		For the six- month period ended June 30, 2020		For the three- month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Fees and commissions paid		3,773		4,243		1,929		2,985
Others		1,756		3,925		1,669		4,427

Total		5,529		8,168		3,598		7,412

- 33 -

23.

DIVIDEND INCOME

Details of dividend income recognized are as follows (Unit: Korean Won in millions):


	2020				2019
	For the three- month period ended June 30, 2020		For the six- month period ended June 30, 2020		For the three- month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Dividend income recognized from investments in subsidiaries		—		677,795		676,000		676,000

24.

PROVISION FOR IMPAIRMENT LOSSES DUE TO CREDIT LOSS

Details of reversal of impairment losses due to credit loss recognized are as follows (Unit: Korean Won in millions):


	2020				2019
	For the three- month period ended June 30, 2020		For the six- month period ended June 30, 2020		For the three- month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Reversal of impairment loss due to credit loss on loans and other financial assets at amortized cost		9		9		—		—

- 34 -

25.

GENERAL AND ADMINISTRATIVE EXPENSES

(1)	Details of general and administrative expenses recognized are as follows (Unit: Korean Won in millions):


			2020				2019
			For the three- month period ended June 30, 2020		For the six-month period ended June 30, 2020		For the three- month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Employee benefits	Short-term employee benefits	Salaries		6,545		12,591		4,099		7,281
		Employee fringe benefits		3,140		5,209		2,621		3,125
	Retirement benefit service costs			1,784		2,204		393		4,189
	Share based payments			517		493		254		531

		Sub-total		11,986		20,497		7,367		15,126

Depreciation and amortization				1,341		2,513		1,083		1,764
Other general and administrative expenses	Rent			318		493		177		333
	Taxes and public dues			53		214		69		110
	Service charges			642		1,666		391		984
	Computer and IT related			682		1,215		400		689
	Telephone and communication			64		190		41		100
	Operating promotion			293		502		135		251
	Advertising			29		101		30		460
	Printing			12		28		6		44
	Traveling			13		34		81		106
	Supplies			74		119		30		55
	Insurance premium			19		19		19		164
	Reimbursement			231		449		206		364
	Vehicle maintenance			52		87		33		50
	Others			20		27		7		10

		Sub-total		2,502		5,144		1,625		3,720

	Total			15,829		28,154		10,075		20,610

- 35 -

(2)	Share-based payment

Details of performance condition share-based payment granted to executives as of June 30, 2020 and 2019 are as follows.

Performance condition share-based payment


Subject to		Shares granted for the year 2019
Type of payment		Cash-settled
Vesting period		January 11, 2019 ~ December 31, 2022
Date of payment		2023-01-01
Fair value		8,215 Won
Valuation method		Black-Scholes Model
Stock price(*1)		8,810 Won
Expected dividend rate		4.13%
Expected maturity date		2.5 years
Number of shares measured as of the closing date (*2)	As of June 30, 2020	77,728 shares
	As of December 31, 2019	77,728 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		7,882 Won
Valuation method		Black-Scholes Model
Stock price(*1)		8,810 Won
Expected dividend rate		4.13%
Expected maturity date		3.5 years
Number of shares measured as of the closing date (*2)	As of June 30, 2020	85,079 shares
	As of December 31, 2019	—

(*1)	Closing price of Woori Financial Group Inc. at the end of June.

(*2)

The number of payable stocks is granted at the initial contract date and the payment rate is determined based on the achievement of the pre-determined performance targets. Performance is evaluated as long-term performance indication including relative shareholder return, net income, return on equity (ROE), non-performing loan ratio and job performance.

The Company 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, 2020 and December 31, 2019 the book value of the liabilities related to the performance condition share-based payments recognized by the company is 1,312 million Won and 819 million Won.

- 36 -

26.

NON-OPERATING INCOME (EXPENSES)

(1)	Details of non-operating income and expenses recognized are as follows (Unit: Korean Won in millions):


	2020						2019
	For the three-month period ended June 30, 2020			For the six-month period ended June 30, 2020			For the three-month period ended June 30, 2019			For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Other non-operating income		181			181			—			—
Other non-operating expense		(1	)		(201	)		(200	)		(600	)

Total		180			(20	)		(200	)		(600	)

(2)	Details of other non-operating income recognized are as follows (Unit: Korean Won in millions):


	2020				2019
	For the three-month period ended June 30, 2020		For the six-month period ended June 30, 2020		For the three-month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Others		181		181		—		—

(3)	Details of other non-operating expenses recognized are as follows (Unit: Korean Won in millions):


	2020				2019
	For the three-month period ended June 30, 2020		For the six-month period ended June 30, 2020		For the three-month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Donations		1		201		200		600

27.

INCOME TAX EXPENSE (INCOME)

Details of income tax expense (income) are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	For the six-month period ended June 30, 2020
Current tax expense:
Current tax expense with respect to the current period		—		—

Sub-total		—		—

Deferred tax expense(income)
Change in deferred tax assets(liabilities) due to temporary differences		766		(574	)
Income tax expense directly attributable to equity		292		167

Sub-total		1,058		(407	)

Income tax expense (income)		1,058		(407	)

Income tax expense (income) 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, 2020, is 0.2% and the interim period from January 11, 2019 (date of incorporation) to June 30, 2019 is tax income, so the annual effective tax rate was not calculated.

- 37 -

28.

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):


	2020						2019
	For the three-month period ended June 30, 2020			For the six-month period ended June 30, 2020			For the three-month period ended June 30, 2019		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Net income attributable to Owners		(23,258	)		637,072			662,072		647,431
Dividends to hybrid securities		(11,853	)		(20,365	)		—		—
Net income attributable to common shareholders		(35,111	)		616,707			662,072		647,431
Weighted average number of common shares outstanding		722			722			680		680
Basic EPS (Unit: Korean Won)		(49	)		854			974		952

(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, 2020

Period

Number of
shares

Dates

Accumulated number
of shares outstanding
during period

Common shares outstanding at the beginning of the period

2020-01-01~2020-06-30

722,267,681

182

131,452,717,942

Sub-total (①)

131,452,717,942

Weighted average number of common shares outstanding (②=(①/182)

722,267,681

For the period from January 11, 2019 (date of incorporation)
to June 30, 2019

Period

Number of
shares

Dates

Accumulated number
of shares outstanding
during period

Common shares issued at the beginning date of incorporation of the period

2019-01-11~2019-06-30

680,164,306

171

116,308,096,326

Sub-total (①)

116,308,096,326

Weighted average number of common shares outstanding (②=(①/171)

680,164,306

Diluted EPS is equal to basic EPS because there is no dilution effect for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019.

- 38 -

29.

CONTINGENT LIABILITIES AND COMMITMENTS

(1)	Litigation case

As of June 30, 2020 and December 31, 2019, the Company has no litigation case in progress.

(2)	Details of loan commitments with financial institutions are as follows (Unit: Korean Won in millions):


		June 30, 2020				December 31, 2019
	Financial institutions	Line of credit		Loan balance		Line of credit		Loan balance
Loans	Standard Chartered Bank Korea Ltd.		65,000		—		65,000		—
	Kookmin Bank		35,000		—		35,000		—

	Total		100,000		—		100,000		—

(3)

The Company 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% interest (58.6% of voting rights) during July, 2019, and to acquire additional 21.3% interest (28.0% of voting rights) after a certain period. As a result, the Company 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 regards to this acquisition, the Company recognized 9,434 million Won as derivative assets as of June 30, 2020 and December 31, 2019 (seeing Note 18).

(4)

On March 31, 2020, the Financial Services Commission, the Korea Development Bank, and the five major financial groups, 17 leading financial institutions and Korea Securities Finance agreed to create a Korea Fund (Securities Market Stabilization Fund) together to cope with the crisis in the securities market. Woori Financial Group will participate in the fund within 1 trillion Won. On April 9, 2020 Woori Bank invested 100 billion won.

- 39 -

30.

RELATED PARTY TRANSACTIONS

Related parties of the Company as of June 30, 2020 and December 31, 2019, and assets and liabilities recognized, guarantees and commitments, major transactions with related parties and compensation to key management for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019 are as follows:

(1) Related parties


		Related parties
Subsidiaries		Woori Bank, Woori Card Co., Ltd., Woori Investment Bank Co., Ltd., Woori FIS Co., Ltd., Woori Finance Research Institute Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Service Co., Ltd., Woori Asset Trust Corp. Ltd., Woori Asset Management Corp., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd., Woori America Bank, PT Bank Woori Saudara Indonesia 1906 Tbk, Woori Global Markets Asia Limited, Woori Bank China Limited, AO Woori Bank, Banco Woori Bank do Brasil S.A., Korea BTL Infrastructure Fund, Woori Finance Myanmar Co., Ltd., Wealth Development Bank, Woori Bank Vietnam Limited, WB Finance Co., Ltd., Woori Bank Europe, TUTU Finance-WCI Myanmar Co., Ltd., Woori Bank Principal and Interest Guaranteed Trust and Woori Bank Principal Guaranteed Trust (“Consolidated trusts”), Kumho Trust First Co., Ltd. and 61 SPCs, Heungkuk Woori Tech Company Private Placement Investment Trust No. 1 and 16 beneficiary certificates

Associates		W Service Networks Co., Ltd., Korea Credit Bureau Co., Ltd., Korea Finance Security Co., Ltd., Lotte card Co., Ltd, Chin Hung International Inc., 2016KIF-IMM Woori Bank Technology Venture Fund, K BANK Co., Ltd., Well to Sea No. 3 Private Equity Fund, and others (Dongwoo C & C Co., Ltd. and 35 associates)

(2)	Assets and liabilities from transactions with related parties are as follows (Unit: Korean Won in millions):


Related party	Title of account	June 30, 2020			December 31, 2019
Woori Bank	Cash and cash equivalents		129,525			43,670
	Other financial assets		738,168			1,229,181
	Allowance for credit losses		(254	)		(263	)
	Other financial liabilities		1,952			601
Woori Card Co., Ltd.	Other financial assets		21,921			37,754
	Other financial liabilities		227			267
Woori FIS Co., Ltd.	Other financial assets		698			1,386
	Other financial liabilities		206			190
Woori Finance Research Institute Co., Ltd.	Other financial assets		154			21
	Other financial liabilities		—			1,320
Woori Credit Information Co., Ltd.	Other financial assets		826			568
Woori Fund Service Co., Ltd.	Other financial assets		282			556
W Service Networks Co., Ltd.	Other financial liabilities		121			64

- 40 -

(3) Gain or loss from transactions with related parties are as follows (Unit: Korean Won in millions):


Related party	Title of account	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
Woori Bank	Interest income		7,699		509
	Dividend income		676,000		676,000
	Interest expenses (*)		18		25
	Fees and commissions expense		9		1
	Reversal of impairment loss due to credit loss		9		—
	General and administrative expenses (*)		1,533		1,043
Woori FIS Co., Ltd.	General and administrative expenses		1,105		488
Woori Finance Research Institute Co., Ltd.	Fees and commissions expenses		3,150		2,800
Woori Credit Information Co., Ltd.	Dividend income		494		—
Woori Fund Service Co., Ltd.	Dividend income		521		—
Woori Asset Trust Co., Ltd	Dividend income		780		—
W Service Networks Co., Ltd.	General and administrative expenses		620		377

(*)	The depreciation of right-of-use assets and interest expense of lease liabilities arising from lease transactions during the current term are included.

(4)	The details of the right-of-use assets and lease liabilities due to lease transactions with related parties as of June 30, 2020 and December 31, 2019 are as follows (Unit: Korea Won in millions):


Related parties	Title of account	June 30, 2020		December 31, 2019
Woori Bank	Right-of-use assets		1,209		1,436
	Lease liabilities (*)		1,073		1,164

(*)	Cash outflows of lease liabilities redemption for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019 are 820 million Won, 542 million Won, respectively.

- 41 -

(5)	The details of loan and borrowing transactions with related parties for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019 are as follows (Unit: Korea Won in millions):

Related parties

Title of account

For the six-month period ended June 30, 2020

Beginning
balance

Increase

Decrease

Ending
balance

Woori Bank

Due from banks

1,130,000

2,700,000

3,080,000

750,000

(*)	Details such as ordinary deposits that can be frequently deposited or withdrawn are excluded.

Related parties

Title of account

For the period from January 11, 2019
(date of incorporation) to June 30, 2019

Beginning
balance

Increase

Decrease

Ending
balance

Woori Bank

Due from banks

—

900,000

—

900,000

(*)	Details such as ordinary deposits that can be frequently deposited or withdrawn are excluded.

(6)	The details of equity-related transactions with related parties for the six-month period ended June 30, 2020 are as follows (Unit: Korean Won in million)


Related parties	Contribution		Acquisition of hybrid securities
Woori Bank		1,000,000		—
Woori Card Co., Ltd.		—		150,000

(7)	There are no guarantees provided to the related parties. The unused commitments provided from the related parties are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019		Warranty
Woori Card Co., Ltd.		229		495	Unused loan commitment

(8)	Compensation for key management is as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	For the six-month period ended June 30, 2020
Short-term employee salaries		2,786		1,751
Retirement benefit service costs		108		534
Share-based compensation		397		368

Total		3,291		2,653

Key management includes registered executives and non-registered executives. The Company has not recognized any outstanding assets, liabilities, allowance and related impairment loss due to credit losses from transaction with key management as of June 30, 2020 and December 31, 2019.

- 42 -

31.

LEASES

(1)	The future lease payments under the lease contracts are as follows (Unit: Korean Won in millions):


	June 30, 2020		December 31, 2019
Lease payments:
Within one year		1,451		1,341
After one year but within five years		385		249

Total		1,836		1,590

(2)	Total cash outflows from lease are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	For the six-month period ended June 30, 2020
Cash outflows from lease		1,031		620

(3)	Details of lease payments that are not included in the measurement of lease liabilities due to the fact that they are leases for which the underlying asset is of low value are as follows (Unit: Korean Won in millions):


	For the six-month period ended June 30, 2020		For the period from January 11, 2019 (date of incorporation) to June 30, 2019
	For the six-month period ended June 30, 2020
Lease payments for which the underlying asset is of low value		64		44

There are no lease payments not included in the lease liabilities measurement, resulting from short-term leases for the six-month period ended June 30, 2020 and for the period from January 11, 2019 (date of incorporation) to June 30, 2019.

(4)

On December 16, 2019 the IFRS Interpretation Committee(IC) announced its interpretation on lease term and useful life of leasehold improvements. The IC discussed how to determine the lease term of a cancellable lease or a renewable lease. The Committee also observed that in determining the enforceable period of lease an entity should consider broader economic penalty. The company plans to reflect its effect subsequent to the analysis of the change in accounting policy regarding lease term.

- 43 -


		January 11, 2019		Establishment of the Company pursuant to a comprehensive stock transfer, by which Woori Bank, Woori FIS, Woori Finance Research Institute, Woori Credit Information, Woori Fund Services and Woori Private Equity Asset Management became wholly-owned subsidiaries of the Company.

		February 13, 2019		Listed on the Korea Exchange (KRX).

		April 5, 2019		Entered into share purchase agreements to acquire Tongyang Asset Management Corp. and ABL Global Asset Management Co., Ltd.

		June 21, 2019		Entered into a purchase agreement with Woori Bank to acquire the common shares of Woori Investment Bank Co., Ltd. (“Woori Investment Bank”) and integrate Woori Investment Bank as a first-tier subsidiary of the Company (Buyer: Woori Financial Group, Seller: Woori Bank)

		July 3, 2019		Entered into a stock exchange agreement between the Company and Woori Card Co., Ltd (“Woori Card”) to integrate Woori Card as a first-tier subsidiary of the Company

		July 25, 2019		Entered into a share purchase agreement to acquire Kukje Asset Trust, Ltd.

		August 1, 2019		Integrated Woori Asset Management Corp. (formerly known as Tongyang Asset Management Co., Ltd.) as a first-tier subsidiary of the Company.

		September 10, 2019		Integrated Woori Card and Woori Investment Bank as first-tier subsidiaries of the Company.

		September 26, 2019		Disposed 4% of common shares of the Company held by Woori Bank to a Taiwanese company, Fubon Life Insurance Co., Ltd.

		December 6, 2019		Integrated Woori Global Asset Management Corp. as a first-tier subsidiary of the Company

		December 30, 2019		Integrated Woori Asset Trust Ltd., as a first-tier subsidiary of the Company

		March 25, 2020		Held the first annual general meeting of shareholders of Woori Financial Group; reappointed the Chief Executive Officer


Type	Name of Company	(Controlling Company)
Company	Woori Financial Group	—
FirstTier Subsidiaries (11 companies)	Woori Bank (equity ownership 100.0%)	Woori Financial Group
	Woori Card (equity ownership 100.0%)
	Woori Investment Bank (equity ownership 59.83%)
	Woori FIS (equity ownership 100.0%)
	Woori Finance Research Institute (equity ownership 100.0%)
	Woori Credit Information (equity ownership 100.0%)
	Woori Fund Services (equity ownership 100.0%)
	Woori Asset Trust (equity ownership 51.0)%
	Woori Asset Management (equity ownership 73.0%)
	Woori Private Equity Asset Management (equity ownership 100.0%)
	Woori Global Asset Management (equity ownership 100.0%)
SecondTier Subsidiaries (14 companies)	Korea BTL Infrastructure Fund (equity ownership 99.88%)	Woori Bank
	Woori America Bank (equity ownership 100.0%)
	Woori Bank China Limited (equity ownership 100.0%)
	PT. Bank Woori Saudara Indonesia (equity ownership 79.88%)
	AO Woori Bank (equity ownership 100.0% - 1 share)
	Banco Woori Bank do Brazil S.A. (equity ownership 100.0% - 1 share)
	WB Finance Co., Ltd (Cambodia) (equity ownership 100.0%)
	Woori Finance Myanmar (equity ownership 100.0%)
	Woori Wealth Development Bank (equity ownership 51%)
	Woori Bank Vietnam Limited (equity ownership 100.0%)
	Woori Bank Europe Gmbh (equity ownership 100.0%)
	Woori Global Markets Asia Limited (equity ownership 100.0%)
	Tutu Finance-WCI Myanmar (equity ownership 100.0%)	Woori Card
	Woori-Hanwha Eureka Private Equity Fund (equity ownership 0.80%)	Woori Private Equity Asset Management


As of June 30, 2020					(unit: shares)
Items	Type				Notes
Items	Common Shares		Total		Notes
Number of authorized shares		4,000,000,000		4,000,000,000
Number of issued shares		722,267,683		722,267,683		Note 1	)
Number of treasury shares		2		2		Note 2	)
Number of outstanding shares		722,267,681		722,267,681


As of June 30, 2020	(unit: shares)
Items			Number of shares		Notes
Number of issued shares		Common Shares		722,267,683		—
Number of issued shares		Preferred Shares		—		—
Number of shares without voting rights		Common Shares		2		Note 1	)
Number of shares without voting rights		Preferred Shares		—		—
Number of shares for which voting rights are excluded pursuant to the articles of incorporation		Common Shares		—		—
		Preferred Shares		—		—
Number of shares for which voting rights are limited by law		Common Shares		11,669,295		Note 2	)
Number of shares for which voting rights are limited by law		Preferred Shares		—		—
Number of shares for which voting rights have been restored		Common Shares		—		—
Number of shares for which voting rights have been restored		Preferred Shares		—		—
Number of shares for which voting rights may be exercised		Common Shares		710,598,388		—
Number of shares for which voting rights may be exercised		Preferred Shares		—		—


For the periods indicated other than as noted below								(units: millions of Won, %)
Classification	Funding Source	2020 1H						2019
Classification	Funding Source	Average Balance		Interest Rate		Proportion		Average Balance		Interest Rate		Proportion
Source	Deposits		258,068,563		1.24		71.26		249,106,401		1.51		71.14
	Borrowings		19,506,526		1.61		5.39		18,013,074		1.92		5.14
	Debentures		31,331,411		2.36		8.65		30,401,987		2.56		8.68
	Others		27,550,822				7.61		28,928,780		—		8.26
	Total Liabilities		336,457,321				92.91		326,449,882		—		93.23
Total Equity			25,683,004				7.09		23,703,431		—		6.77
Total Liabilities & Equity			362,140,325				100.00		350,153,313		—		100.00

June 30, 2020

December 31, 2019


1.		Summary of 2020 1H Business Report

2.		Exhibit 99.1 Woori Financial Group Review Report for 2020 1H (Consolidated)

3.		Exhibit 99.2 Woori Financial Group Review Report for 2020 1H (Separate)


I.	INTRODUCTION OF THE COMPANY		5

	1.	Overview of the Company	5

	2.	Capital Structure (Changes in Capital)	7

	3.	Total Number of Authorized Shares	7

	4.	Voting Rights	8

	5.	Dividend Information	8

II.	BUSINESS OVERVIEW		9

	1.	Results of Operations	9

	2.	Funding Sources and Uses of Funds	9

	3.	Other Information Necessary for Making Investment Decisions	11

III.	FINANCIAL INFORMATION		15

	1.	Condensed Financial Statements (Consolidated)	15

	2.	Condensed Financial Statements (Separate)	17

IV.	INDEPENDENT AUDITOR’S OPINION		19

	1.	Independent Auditor’s Opinion	19

	2.	Compensation to the Independent Auditor	19

V.	CORPORATE GOVERNANCE AND AFFILIATED COMPANIES		21

	1.	About the Board of Directors	21

	2.	Affiliated Companies (As of June 30, 2020)	22

VI.	SHAREHOLDER INFORMATION		23

	1.	Share Distribution	23

	2.	Stock Price and Stock Market Performance	24

VII.	DIRECTORS AND EMPLOYEE INFORMATION		26

	1.	Directors and Executives	26

	2.	Employee Status	27

	3.	Directors’ Compensation	27


As of June 30, 2020	(unit: billions of Won)

Type	2020 1H		2019		2018
Operating income		1,173		2,800		—
Non-operating income		-139		-77		—
Income from continuing operations before income tax		1,034		2,723		—
Income tax expense from continuing operations		260		685		—
Income from discontinued operations		—		—		—
Net income		774		2,038		—
Controlling Interest		661		1,872
Non-controlling Interest		113		165


As of the end of the period indicated	(units: billions of Won, % )
Type	2020 1H		2019
Equity capital (A)		27,352		27,115
Risk weighted assets (B)		214,815		228,046
BIS(Capital adequacy) ratio (A/B)		12.73		11.89


As of the end of the periods indicated					(units: 100 millions of Won, % )
Name of Company	Type		2020 1H		2019		2018
Woori Bank	BIS ratio	Equity capital (A)		253,719		243,142		242,508
		Risk weighted assets (B)		1,714,652		1,578,895		1,549,710
		Capital adequacy ratio (A/B)		14.80		15.40		15.65
Woori Card	Adjusted capital ratio			19.97		18.33		18.08
Woori Card	Tangible common equity ratio			13.84		14.29		13.54
Woori Investment Bank	BIS ratio	Equity capital (A)		3,680		3,381		3,003
		Risk weighted assets (B)		30,069		26,303		23,192
		Capital adequacy ratio (A/B)		12.24		12.86		12.95
Woori Asset Trust	Operating capital ratio			1,182.00		1,397.97		957.76
Woori Asset Management	Minimum operating capital ratio			709.36		655.8		558.9


As of the end of the periods indicated													(units: millions of Won, % )
Type	2020 1H						2019						2018
Type	Won Liquidity Assets		Won Liquidity Liabilities		Won Liquidity Ratio		Won Liquidity Assets		Won Liquidity Liabilities		Won Liquidity Ratio		Won Liquidity Assets		Won Liquidity Liabilities		Won Liquidity Ratio
Woori Financial Group Note 1)		79,538		2,078		3,827.6		45,079		7,475		603.1		—
Woori Card Note 2)		6,283,500		1,574,185		399.2		5,976,031		1,407,335		424.6		6,055,752		1,349,874		448.6
Woori Investment Bank Note 2)		1,989,498		945,697		210.4		1,671,823		1,118,318		149.5		1,183,476		444,475		266.3
Woori Asset Trust Note 3)		87,421		11,517		759.07		67,555		14,595		462.9		61,161		9,411		649.9


						(unit: % )
Name of Company	Type	2020 1H		2019		2018
Woori Bank	Liquidity coverage ratio Note 1)		104.45		107.27		103.40
	Foreign currency liquidity coverage ratio Note 2)		115.02		110.50		108.98
	Ratio of business purpose premises and equipment		11.48		12.22		12.34


																	(units: % )
Type	2020 1H						2019						2018
Type	Substandard and below ratio		NPL ratio		Substandard and below coverage ratio		Substandard and below ratio		NPL ratio		Substandard and below coverage ratio		Substandard and below ratio		NPL ratio		Substandard and below coverage ratio
Woori Bank		0.38		0.36		136.42		0.40		0.36		121.80		0.51		0.43		119.42
Woori Card		0.69		—		102.85		0.80		—		102.84		0.80		—		104.02
Woori Investment Bank		0.52		0.30		145.30		0.49		0.21		167.39		1.51		1.49		51.21
Woori Asset Trust		46.31		—		—		37.51		—		—		10.52		—		—


(The Company and its Consolidated Subsidiaries, as of the end of the periods indicated)				(unit: millions of Won)
Classification	2020 1H			2019			2018
ASSETS
Cash and cash equivalents		9,437,619			6,392,566			6,747,894
Financial assets at fair value through profit or loss (“FVTPL”)		10,067,062			8,069,144			6,126,316
Financial assets at fair value through other comprehensive income		29,612,408			27,730,531			18,063,423
Securities at amortized cost		18,610,602			20,320,539			22,932,559
Loans and other financial assets at amortized cost		306,418,069			293,717,693			282,457,578
Investments in joint ventures and associates		928,161			806,360			361,766
Investment properties		312,806			280,239			378,196
Premises and equipment		3,311,009			3,364,716			2,450,492
Intangible assets		820,380			844,110			597,520
Assets held for sale		9,614			10,556			17,912
Net defined benefit asset		—			2,582			—
Current tax assets		39,230			47,367			20,730
Deferred tax assets		39,440			39,544			59,641
Derivative assets (designated for hedging)		249,880			121,131			35,503
Other assets		221,096			233,646			197,653

Total assets		380,077,376			361,980,724			340,447,183

LIABILITIES
Financial liabilities at FVTPL		4,031,235			2,958,302			2,282,686
Deposits due to customers		276,967,229			264,685,578			248,690,939
Borrowings		21,263,126			18,998,920			16,202,986
Debentures		31,029,872			30,858,055			28,735,862
Provisions		551,389			443,980			391,313
Net defined benefit liability		146,325			92,470			173,109
Current tax liabilities		102,278			182,690			159,078
Deferred tax liabilities		200,263			134,322			18,156
Derivative liabilities (designated for hedging)		15,022			6,837			51,408
Other financial liabilities		19,635,458			17,706,767			21,442,524
Other liabilities		383,491			420,471			346,078

Total liabilities		354,325,688			336,488,392			318,494,139

EQUITY
Owners’ equity:		22,301,193			21,510,370			21,739,931
Capital stock		3,611,338			3,611,338			3,381,392
Hybrid securities		1,695,821			997,544			3,161,963
Capital surplus		627,625			626,295			285,889
Other equity		(2,285,790	)		(2,249,322	)		(2,213,970	)
Retained earnings		18,652,199			18,524,515			17,124,657
Non-controlling interests		3,450,495			3,981,962			213,113

Total equity		25,751,688			25,492,332			21,953,044

Total liabilities and equity		380,077,376			361,980,724			340,447,183

Number of Consolidated Subsidiaries (excluding holding company)		104			102			65


(The Company and its Consolidated Subsidiaries, for the periods indicated)	(unit: millions of Won, except per share amounts)
Classification	2020 1H			2019 1H			2019			2018
Operating income		1,172,598			1,710,412			2,799,976			2,759,301
Net interest income		2,940,849			2,931,052			5,893,706			5,650,951
Net fees and commissions income		498,349			560,090			1,102,628			1,069,974
Dividend income		71,002			64,583			107,959			90,552
Net gain or loss on financial instruments at FVTPL (fair value through profit or loss)		401,589			80,081			25,455			214,443
Net gain or loss on financial assets at FVTOCI		11,027			3,445			11,015			2,047
Net gain on disposals of financial assets at amortized cost		32,662			94,619			102,115			79,532
Impairment losses due to credit loss		(446,679	)		(136,546	)		(374,244	)		(329,574	)
General and administrative expenses		(1,789,558	)		(1,695,786	)		(3,766,077	)		(3,624,033	)
Other net operating income (expenses)		(546,643	)		(191,126	)		(302,581	)		(394,591	)

Non-operating income(expense)		(138,749	)		17,670			(76,927	)		45,571

Net income before income tax expense		1,033,849			1,728,082			2,723,049			2,804,872

Income tax expense		259,816			456,119			685,453			753,223

Net income		774,033			1,271,963			2,037,596			2,051,649

Net income attributable to owners		660,564			1,179,688			1,872,207			2,033,182
Net income attributable to the non-controlling interests		113,469			92,275			165,389			18,467
Other comprehensive income (loss), net of tax		(9,167	)		68,498			51,782			(92,236	)
Items that will not be reclassified to profit or loss		(121,454	)		(86,645	)		(92,777	)		(115,384	)
Items that may be reclassified to profit or loss		112,287			155,143			144,559			23,148

Total comprehensive income		764,866			1,340,461			2,089,378			1,959,413

Comprehensive income attributable to the owners		648,420			1,240,153			1,914,393			1,943,885
Comprehensive income attributable to non-controlling interests		116,446			100,308			174,985			15,528
Net income per share:
Basic and diluted loss per share (in Korean Won)		887			1,755			2,727			2,796


For the periods indicated other than as noted below						(units: millions of Won, %)
Type	Managed Item	2020 1H						2019
Type	Managed Item	Average Balance		Interest Rate		Proportion		Average Balance		Interest Rate		Proportion
Use	Cash & Due from Banks		11,628,729		0.57		3.21		9,202,054		1.55		2.63
	Marketable securities		54,146,360		1.99		14.95		50,396,362		2.29		14.39
	Loans		261,945,510		3.18		72.33		254,691,201		3.48		72.74
	Loans in local currency		226,278,644		2.91		62.48		219,418,214		3.22		62.66
	Loans in foreign currency		22,413,640		4.31		6.19		20,982,894		4.59		5.99
	Guarantee payments		11,527		8.23		0.00		12,410		1.48		0.00
	Credit card receivables		8,063,083		8.06		2.23		8,139,789		7.98		2.32
	Foreign bills bought		5,178,617		2.29		1.43		6,137,894		2.96		1.75
	Bad debt expense in local currency (-)		-1,638,965				-0.45		-1,666,215		—		-0.48
	Other		36,058,691				9.96		37,529,911		—		10.72
Total Assets			362,140,325				100.00		350,153,313		—		100.00


												(unit: % )
Type	2020 1H				2019				2018
Type	ROA		ROE		ROA		ROE		ROA		ROE
Woori Financial Group Note 1)
Including non-controlling interests		0.41		7.08		0.57		10.11		—
Excluding non-controlling interests		0.35		6.04		0.52		9.29		—
Woori Bank Note 2)		0.38		5.86		0.55		8.36		0.60		8.82
Woori Card Note 2)		1.13		6.14		0.90		5.05		0.72		4.00
Woori Investment Bank Note 2)		1.58		13.73		1.69		13.66		1.30		10.49
Woori Asset Trust Note 3)		27.08		39.01		25.18		37.40		28.73		49.43
Woori Asset Management		5.63		5.93		7.41		7.77		6.06		6.32


(The Company, as of the end of the period indicated)	(unit: millions of Won)
Classification	2020 1H			2019
ASSETS
Cash and cash equivalents		129,525			43,670
Financial assets at fair value through profit or loss		9,434			9,434
Financial assets at fair value through other comprehensive income		150,265			—
Loans and other financial assets at amortized cost		761,795			1,269,203
Investments in subsidiaries		20,873,593			19,873,593
Premises and equipment		9,384			7,383
Intangible assets		5,609			3,310
Other assets		15			—

Total assets		21,939,620			21,206,593

LIABILITIES
Debentures		947,789			947,679
Provisions		714			600
Net defined benefit liability		7,566			3,482
Current tax liabilities		57,554			133,526
Deferred tax liabilities		921			154
Other financial liabilities		9,860			10,745
Other liabilities		323			4,142

Total liabilities		1,024,727			1,100,328

EQUITY
Capital stock		3,611,338			3,611,338
Hybrid securities		1,695,821			997,544
Capital surplus		14,874,084			14,874,084
Other equity		(1,400	)		(631	)
Retained Earnings		735,050			623,930

Total equity		20,914,893			20,106,265

Total liabilities and equity		21,939,620			21,206,593


(The Company, for the period indicated)	(unit: millions of Won, except per share amounts)
Classification	2020 1H			2019 1H			2019
Operating Income:		638,150			647,624			629,437
Net interest income		(3,332	)		(354	)		40
Interest income		7,699			509			7,741
Interest expense		11,031			863			7,701
Net fees and commissions loss		(8,168	)		(7,412	)		(15,833	)
Fees and commissions income		—			—			—
Fees and commissions expense		8,168			7,412			15,833
Dividend income		677,795			676,000			676,000
Net gain on financial instruments at FVTPL		—			—			9,434
Impairment losses due to credit loss		9			—			(263	)
General and administrative expenses		(28,154	)		(20,610	)		(39,941	)
Non-operating loss		(20	)		(600	)		(750	)
Net Income before income tax expense		638,130			647,024			628,687
Income tax expense		1,058			(407	)		(394	)

Net Income		637,072			647,431			628,293

Other comprehensive loss, net of tax		(769	)		(445	)		(631	)
Items that will not be reclassified to profit or loss		(769	)		(445	)		(631	)
Net gain on valuation of equity securities at FVTOCI		192			—			—
Remeasurement loss related to defined benefit plan		(961	)		(445	)		(631	)

Total comprehensive Income		636,303			646,986			627,662

Net Income per share:
Basic and diluted Income per share (In Korean Won)		854			952			900


Term	Auditor		Description	Fee
2019		Deloitte Anjin LLC	Auditing services provided in connection with the submission of a holding company establishment report to the Fair Trade Commission		KRW 67 million


(As of June 30, 2020) Name of Committee	Composition	Names of Members
Audit Committee	Three outside directors	(Chairman) Chan-Hyoung Chung (outside director) Sung-Tae Ro (outside director) Dong-Woo Chang (outside director)
Board Risk Management Committee	Three outside directors One non-standing director One standing director	(Chairman) Sang-Yong Park (outside director) Dennis Chan (outside director) Zhiping Tian (outside director) Hong-Tae Kim (non-standing director) Won-Duk Lee (standing director)
Compensation Committee	Six outside directors One non-standing director	(Chairman) Chan-Hyoung Chung (outside director) Sung-Tae Ro (outside director) Sang-Yong Park (outside director) Dennis Chan (outside director) Zhiping Tian (outside director) Dong-Woo Chang (outside director) Hong-Tae Kim (non-standing director)
Committee for Recommending Executive Officer Candidates	Six outside directors	(Chairman) Dong-Woo Chang (outside director) Sung-Tae Ro (outside director) Sang-Yong Park (outside director) Chan-Hyoung Chung (outside director) Dennis Chan (outside director) Zhiping Tian (outside director)
Committee for Recommending Group Executive Officer Candidates	Six outside directors One standing director	(Chairman) Tae-Seung Son (standing director) Sung-Tae Ro (outside director) Sang-Yong Park (outside director) Chan-Hyoung Chung (outside director) Dennis Chan (outside director) Zhiping Tian (outside director) Dong-Woo Chang (outside director)
Committee for Internal Control Management	One outside director One non-standing director One standing director	(Chairman) Sang-Yong Park (outside director) Hong-Tae Kim (non-standing director) Tae-Seung Son (standing director)


		transfer ratio Woori Bank : Woori Financial Group = 1: 1.0000000


As of June 30, 2020	(units: shares, %)
	Name	Shares				Notes
	Name	No. of shares		Percentage of shareholding		Notes
Share ownership of more than 5%	Korea Deposit Insurance Corporation		124,604,797		17.25		—
	National Pension Service		71,378,664		9.88		1	)
	Nobis1, Inc. (IMM PE)		40,560,000		5.62		—
Employee Stock Ownership Association			53,713,148		7.44		2	)


												(units: Won, shares)
Period		January 2020		February 2020		March 2020		April 2020		May 2020		June 2020
Common Shares	High		11,400		10,500		9,630		8,440		9,130		10,350
	Low		10,150		9,400		6,560		7,270		7,810		8,690
	Average		10,728		10,067		7,989		7,893		8,114		9,405
Monthly Trade Volume	High		3,032,036		7,798,094		5,753,690		4,688,039		7,434,397		4,612,618
	Low		1,196,984		1,449,936		1,895,258		1,974,492		1,395,328		1,258,950
	Monthly Total		38,739,407		47,347,306		74,783,169		57,640,374		53,303,073		54,242,951


										(units: US Dollars, Won, ADSs)
Period		January 2020		February 2020		March 2020		April 2020		May 2020		June 2020
ADS	High		30.09		26.62		24.77		21.47		22.08		26.07
	Low		25.40		22.88		15.60		17.31		18.98		21.74
	Average		27.60		25.18		20.10		19.50		19.99		23.30
Won Conversion	High		34,838		31,520		29,510		26,305		27,365		31,737
	Low		30,060		27,584		19,563		21,118		23,305		26,057
	Average		32,134		30,055		24,518		23,895		24,564		28,192
Monthly Trade Volume	High		110,600		93,100		237,600		214,700		164,700		106,900
	Low		18,500		15,500		65,000		34,600		34,600		18,500
	Monthly Total		839,000		946,100		2,700,200		2,009,400		1,413,000		1,254,900


As of June 30, 2020			(units: persons, millions of Won)
Items	Number of Persons		Total Compensation		Average Compensation Per Director		Note
Registered Directors (excludes outside directors and audit committee members)		3		816		272		—
Outside Directors (excludes audit committee members)		3		87		29		—
Audit Committee Members		3		84		28		—
Auditor		—		—		—		—


	Woori Financial Group Inc.
	(Registrant)

Date: August 14, 2020	By:	/s/ Kyong-Hoon Park
	(Signature)
	Name: Kyong-Hoon Park
	Title: Deputy President