CONSOLIDATED INTERIM FINANCIAL STATEMENTS

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

JUNE 30, 2021 AND 2020

WOORI FINANCIAL GROUP INC.

Page(s)

Report on Review of Consolidated Interim Financial Statements

 1-2

Consolidated Interim Financial Statements

Consolidated Interim Statements of Financial Position

4

Consolidated Interim Statements of Comprehensive Income

5-6

Consolidated Interim Statements of Changes in Equity

7

Consolidated Interim Statements of Cash Flows

8-9

Notes to the Consolidated Interim Financial Statements

 10-125

Report on Review of Consolidated Interim Financial Statements

English Translation of a Report Originally Issued in Korean on August 13, 2021

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

Reviewed Financial Statements

We have reviewed the accompanying consolidated interim financial statements of Woori Financial Group Inc. and its subsidiaries (collectively referred to as the 'Group'). These financial statements consist of the consolidated interim statement of financial position of the Group as at June 30, 2021 and the related consolidated interim statements of comprehensive income for the three-month and six-month periods ended June 30, 2021 and 2020, and consolidated interim statements of changes in equity and cash flows for the six-month periods ended June 30, 2021 and 2020, and a summary of significant accounting policies and other explanatory notes, expressed in Korean Won.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated interim financial statements in accordance with International Financial Reporting Standards as adopted by the Republic of Korea ('Korean IFRS') 1034 Interim Financial Reporting, and for such internal control as management determines is necessary to enable the preparation of consolidated interim financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to issue a report on these consolidated interim financial statements based on our review.

We conducted our review in accordance with quarterly or semi-annual review standards established by the Securities and Futures Commission of the Republic of Korea. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Korean Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

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

- 1 -

Emphasis of Matters

Without qualifying our conclusion, we draw attention to Note 3 of the consolidated financial statements, which indicates that the outbreak of COVID-19 may have a negative impact on the Group's financial condition and results of operations.

Other Matters

We have audited the consolidated statement of financial position of the Group as at December 31, 2020, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, in accordance with Korean Standards on Auditing. We expressed an unqualified opinion on those financial statements, not presented herein, in our audit report dated March 12, 2021. The consolidated statement of financial position as at December 31, 2020, presented herein for comparative purposes, is consistent, in all material respects, with the above audited consolidated statement of financial position as at December 31, 2020.

Review standards and their application in practice vary among countries. The procedures and practices used in the Republic of Korea to review such financial statements may differ from those generally accepted and applied in other countries.

/s/ Samil PricewaterhouseCoopers

Seoul, Korea

August 13, 2021

Notice to Readers

This report is effective as of August 13, 2021, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying consolidated interim financial statements and notes thereto. Accordingly, the readers of the review report should understand that there is a possibility that the above review report may have to be revised to reflect the impact of such subsequent events or circumstances, if any.

- 2 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM FINANCIAL STATEMENTS

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

JUNE 30, 2021 AND 2020

The accompanying consolidated interim financial statements including

all footnote disclosures were prepared by, and are the responsibility of, the management of Woori Financial

Group Inc.

Tae Seung Son

President and Chief Executive Officer

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

(Phone Number) 02-2125-2000

- 3 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

AS OF JUNE 30, 2021 (UNAUDITED) AND DECEMBER 31, 2020

June 30,
2021 		December 31,
2020
(Korean Won in millions)
ASSETS

Cash and cash equivalents (Note 6)

10,411,346 9,990,983

Financial assets at fair value through profit or loss ('FVTPL') (Notes 4, 7, 11, and 24)

12,264,521 14,762,941

Financial assets at fair value through other comprehensive income ('FVTOCI') (Notes 4, 8, and 11)

30,284,891 30,028,929

Securities at amortized cost (Notes 4, 9, and 11)

15,725,241 17,020,839

Loans and other financial assets at amortized cost (Notes 4, 10, 11, and 39)

345,150,425 320,106,078

Investments in joint ventures and associates (Note 12)

1,175,274 993,291

Investment properties (Note 13)

386,650 387,464

Premises and equipment (Notes 14)

3,190,194 3,287,198

Intangible assets (Note 15)

775,614 792,077

Assets held for sale (Note 16)

35,495 60,002

Net defined benefit asset (Note 22)

1,809 5,658

Current tax assets

33,606 75,655

Deferred tax assets

37,365 46,088

Derivative assets (Designated for hedging) (Notes 4, 11 and 24)

129,562 174,820

Other assets (Notes 17 and 39)

1,668,613 1,348,994

Total assets

421,270,606 399,081,017
LIABILITIES

Financial liabilities at fair value through profit or loss ('FVTPL') (Notes 4, 11, 18 and 24)

3,928,181 6,813,822

Deposits due to customers (Notes 4, 11, 19 and 39)

302,492,676 291,477,279

Borrowings (Notes 4, 11 and 20)

22,545,862 20,745,466

Debentures (Notes 4, 11 and 20)

40,917,952 37,479,358

Provisions (Notes 21, 38 and 39)

500,497 501,643

Net defined benefit liability (Note 22)

57,736 52,237

Current tax liabilities

333,409 370,718

Deferred tax liabilities

268,786 160,250

Derivative liabilities (Designated for hedging) (Notes 4, 11 and 24)

44,045 64,769

Other financial liabilities (Notes 4, 11, 23 and 39)

21,549,754 14,215,817

Other liabilities (Notes 23 and 39)

471,534 473,813

Total liabilities

393,110,432 372,355,172
EQUITY

Owners' equity (Note 26)

Capital stock

3,611,338 3,611,338

Hybrid securities

2,094,818 1,895,366

Capital surplus

631,368 626,111

Other equity

(2,176,729 ) (2,347,472 )

Retained earnings

20,398,356 19,268,265
24,559,151 23,053,608

Non-controlling interests

3,601,023 3,672,237

Total equity

28,160,174 26,725,845

Total liabilities and equity

421,270,606 399,081,017

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

- 4 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2021 AND 2020 (UNAUDITED)

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month
(Korean Won in millions, except per share data)

Interest income

2,383,286 4,710,471 2,412,189 4,916,003

Financial assets at FVTPL

11,046 22,420 13,681 26,210

Financial assets at FVTOCI

83,821 175,607 114,823 241,000

Financial assets at amortized cost

2,288,419 4,512,444 2,283,685 4,648,793

Interest expense

(680,333 ) (1,387,852 ) (934,299 ) (1,975,154 )

Net interest income (Notes 11, 28 and 39)

1,702,953 3,322,619 1,477,890 2,940,849

Fees and commissions income

547,051 1,065,916 397,282 807,993

Fees and commissions expense

(176,058 ) (336,462 ) (172,913 ) (309,644 )

Net fees and commissions income (Notes 11, 29 and 39)

370,993 729,454 224,369 498,349

Dividend income (Notes 11, 30 and 39)

64,148 130,738 23,233 71,002

Net gain(loss) on financial instruments at FVTPL (Notes 11, 31 and 39)

54,324 136,407 (66,486 ) 401,589

Net gain on financial assets at FVTOCI (Notes 11 and 32)

8,048 45,059 8,427 11,027

Net gain arising on financial assets at amortized cost (Note 11)

4,004 38,680 5,915 32,662

Impairment losses due to credit loss (Notes 33 and 39)

(68,583 ) (204,576 ) (335,787 ) (446,679 )

General and administrative expense (Notes 34 and 39)

(937,886 ) (1,855,493 ) (897,032 ) (1,789,558 )

Other net operating expense (Notes 11, 24, 34 and 39)

(147,673 ) (359,048 ) (41,269 ) (546,643 )

Operating income

1,050,328 1,983,840 399,260 1,172,598

Share of gain of joint ventures and associates (Note 12)

31,832 26,241 16,798 23,952

Other non-operating income(expense)

(6,174 ) 7,667 (134,822 ) (162,701 )

Non-operating income(expense) (Note 35)

25,658 33,908 (118,024 ) (138,749 )

Net income before income tax expense

1,075,986 2,017,748 281,236 1,033,849

Income tax expense (Note 36)

(257,602 ) (480,497 ) (64,974 ) (259,816 )

Net income

818,384 1,537,251 216,262 774,033

Net gain(loss) on valuation of equity securities at FVTOCI

146,935 172,101 14,957 (95,214 )

Changes in capital due to equity method

(312 ) (23 ) - -

Remeasurement loss related to defined benefit plan

20,908 13,604 (6,911 ) (26,240 )

Items that will not be reclassified to profit or loss

167,531 185,682 8,046 (121,454 )

Net gain(loss) on valuation of debt securities at FVTOCI

(72,540 ) (126,353 ) 45,464 69,463

Changes in capital due to equity method

604 1,899 (3,614 ) (4,621 )

Net gain on foreign currency translation of foreign operations

5,294 86,261 43,478 57,475

Net gain(loss) on valuation of cash flow hedge

4,052 4,046 (545 ) (10,030 )

Items that may be reclassified to profit or loss

(62,590 ) (34,147 ) 84,783 112,287

Other comprehensive income(loss), net of tax

104,941 151,535 92,829 (9,167 )

Total comprehensive income

923,325 1,688,786 309,091 764,866

(Continued)

- 5 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2021AND 2020 (UNAUDITED) (CONTINUED)

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month
(Korean Won in millions, except per share data)

Net income attributable to:

 818,384 1,537,251 216,262 774,033

Net income attributable to owners

752,595 1,419,698 142,348 660,564

Net income attributable to non-controlling interests

65,789 117,553 73,914 113,469

Total comprehensive income attributable to:

 923,325 1,688,786 309,091 764,866

Comprehensive income attributable to owners

857,879 1,569,431 221,161 648,420

Comprehensive income attributable to non-controlling interests

65,446 119,355 87,930 116,446

Earnings per share (Note 37)

Basic and diluted earnings per share (Unit: In Korean Won)

1,020 1,922 181 887

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

- 6 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY

FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2021 AND 2020 (UNAUDITED)

Capital
Stock 		Hybrid
securities 		Capital
surplus 		Other
equity 		Retained
earnings 		Owners'
equity in
total 		Non-controlling
interests 		Total
equity
(Korean Won in millions)

January 1, 2020

 3,611,338 997,544 626,295 (2,249,322 ) 18,524,515 21,510,370 3,981,962 25,492,332

Total comprehensive income

Net income

- - - - 660,564 660,564 113,469 774,033

Net loss on valuation of financial instruments at FVTOCI

- - - (25,697 ) - (25,697 ) (54 ) (25,751 )

Net gain(loss) due to disposal of equity securities at FVTOCI

- - - 578 (578 ) - - -

Changes in capital due to equity method

- - - (4,621 ) - (4,621 ) - (4,621 )

Gain on foreign currency translation of foreign operations

- - - 54,445 - 54,445 3,030 57,475

Loss on valuation of cash flow hedge

- - - (10,030 ) - (10,030 ) - (10,030 )

Remeasurement gain(loss) related to defined benefit plan

- - - (26,241 ) - (26,241 ) 1 (26,240 )

Transactions with owners and others

Dividends to common stocks

- - - - (505,587 ) (505,587 ) (2,054 ) (507,641 )

Issuance of hybrid securities

- 698,277 - - - 698,277 - 698,277

Dividends to hybrid securities

- - - - (20,365 ) (20,365 ) (90,091 ) (110,456 )

Redemption of hybrid securities

- - - (31,252 ) - (31,252 ) (555,744 ) (586,996 )

Changes in subsidiaries' capital

- - 1,330 6,350 (6,350 ) 1,330 (24 ) 1,306

June 30, 2020 (Unaudited)

 3,611,338 1,695,821 627,625 (2,285,790 ) 18,652,199 22,301,193 3,450,495 25,751,688

January 1, 2021

 3,611,338 1,895,366 626,111 (2,347,472 ) 19,268,265 23,053,608 3,672,237 26,725,845

Total comprehensive income

Net income

- - - - 1,419,698 1,419,698 117,553 1,537,251

Net gain on valuation of financial instruments at FVTOCI

- - - 45,711 - 45,711 37 45,748

Net gain(loss) due to disposal of equity securities at FVTOCI

- - - (33,448 ) 33,448 - - -

Changes in capital due to equity method

- - - 2,673 (797 ) 1,876 - 1,876

Gain on foreign currency translation of foreign operations

- - - 84,639 - 84,639 1,622 86,261

Gain on valuation of cash flow hedge

- - - 3,889 - 3,889 157 4,046

Capital related to noncurrent assets held for sale

- - - (560 ) 560 - - -

Remeasurement gain(loss) related to defined benefit plan

- - - 13,618 - 13,618 (14 ) 13,604

Transactions with owners and others

Dividends to common stocks

- - - - (260,016 ) (260,016 ) (9,374 ) (269,390 )

Issuance of hybrid securities

- 199,452 - - - 199,452 - 199,452

Dividends to hybrid securities

- - - - (31,550 ) (31,550 ) (71,537 ) (103,087 )

Changes in subsidiaries' capital

- - 25 31,233 (31,252 ) 6 (26 ) (20 )

Others

- - 5,232 22,988 - 28,220 (109,632 ) (81,412 )

June 30, 2021 (Unaudited)

 3,611,338 2,094,818 631,368 (2,176,729 ) 20,398,356 24,559,151 3,601,023 28,160,174

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

- 7 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2021 AND 2020 (UNAUDITED)

For the six-month periods ended June 30
2021 2020
(Korean Won in millions)

Cash flows from operating activities:

Net income

1,537,251 774,033

Adjustments to net income:

Income tax expense

480,497 259,816

Interest income

(4,710,471 ) (4,916,003 )

Interest expense

1,387,852 1,975,154

Dividend income

(130,738 ) (71,002 )
(2,972,860 ) (2,752,035 )

Additions of expenses not involving cash outflows:

Loss on valuation of financial instruments at FVTPL

102,439 -

Loss on financial assets at FVTOCI

242 344

Impairment loss due to credit loss

204,576 446,679

Loss on other provisions

14,651 169,349

Retirement benefit

88,663 86,185

Depreciation and amortization

385,003 266,837

Net loss on foreign currency translation

- 339,687

Loss on derivatives (designated for hedge)

53,359 9,324

Loss on fair value hedge

- 108,090

Loss on investments in joint ventures and associates

12,461 11,731

Loss on disposal of premises and equipment, intangible assets and other assets

1,798 821

Impairment loss on premises and equipment, intangible assets and other assets

639 8,254
863,831 1,447,301

Deductions of income not involving cash inflows:

Gain on valuation of financial instruments at FVTPL

- 249,455

Gain on financial assets at FVTOCI

45,301 11,371

Gain on other provisions

648 124

Net gain on foreign currency translation

4,742 -

Gain on derivatives (designated for hedge)

26,477 132,356

Gain on fair value hedge

61,262 -

Gain on investments in joint ventures and associates

38,702 35,683

Gain on disposal of premises and equipment, intangible assets and other assets

33,345 6,575

Reversal of impairment loss on premises and equipment, intangible assets and other assets

96 55

Other income

19,313 4,608
229,886 440,227

Changes in operating assets and liabilities:

Financial instruments at FVTPL

176,818 (167,347 )

Loans and other financial assets at amortized cost

(24,005,568 ) (12,171,466 )

Other assets

(425,861 ) (56,319 )

Deposits due to customers

9,979,228 11,526,133

Provisions

(16,256 ) (90,706 )

Net defined benefit liability

(61,179 ) (67,202 )

Other financial liabilities

7,264,990 1,929,411

Other liabilities

(7,136 ) (38,327 )
(7,094,964 ) 864,177

Interest income received

4,637,247 5,052,912

Interest expense paid

(1,538,731 ) (2,268,755 )

Dividends received

130,823 71,134

Income tax paid

(351,844 ) (236,188 )

Net cash inflow(outflow) from operating activities

(5,019,133 ) 2,512,352

(Continued)

- 8 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2021 AND 2020 (UNAUDITED) (CONTINUED)

For the six-month periods ended June 30
2021 2020
(Korean Won in millions)

Cash flows from investing activities:

Cash in-flows from investing activities:

Net increase in derivatives designated for hedging purpose

479 499

Disposal of financial instruments at FVTPL

6,219,265 3,485,089

Disposal of financial assets at FVTOCI

13,521,839 11,062,888

Redemption of securities at amortized cost

2,810,065 3,406,645

Disposal of investments in joint ventures and associates

22,320 32,162

Disposal of investment properties

- 354

Disposal of premises and equipment

56,026 17,212

Disposal of intangible assets

334 371

Net decrease of other assets

50,652 -
22,680,980 18,005,220

Cash out-flows from investing activities:

Acquisition of financial instruments at FVTPL

6,877,285 3,995,877

Acquisition of financial assets at FVTOCI

13,506,169 12,883,464

Acquisition of securities at amortized cost

1,496,443 1,678,871

Acquisition of investments in joint ventures and associates

176,835 130,261

Acquisition of investment properties

- 1,514

Acquisition of premises and equipment

40,454 57,266

Acquisition of intangible assets

61,454 56,640

Net increase of other assets

- 2,671
22,158,640 18,806,564

Net cash inflow(outflow) from investing activities

522,340 (801,344 )

Cash flows from financing activities:

Cash in-flows from financing activities:

Net increase in derivatives designated for hedging purpose

2,480 -

Net increase in borrowings

1,485,574 1,960,150

Issuance of debentures

15,187,733 10,849,477

Net increase of other liabilities

3,224 5,516

Issuance of hybrid securities

199,452 698,277
16,878,463 13,513,420

Cash out-flows from financing activities:

Net decrease in derivatives designated for hedging purpose

- 6,054

Redemption of debentures

11,867,048 10,893,170

Redemption of lease liabilities

92,223 102,968

Dividends paid

260,016 505,587

Redemption of hybrid securities

- 598,850

Dividends paid to hybrid securities

103,087 110,456

Dividends paid to non-controlling interest

9,374 2,054

Changes in non-controlling interests

52,947 -

Paid-in capital decrease on non-controlling interests

27 -
12,384,722 12,219,139

Net cash inflow from financing activities

4,493,741 1,294,281

Net increase(decrease) in cash and cash equivalents

 (3,052 ) 3,005,289

Cash and cash equivalents, beginning of the period

 9,990,983 6,392,566

Effects of exchange rate changes on cash and cash equivalents

423,415 39,764

Cash and cash equivalents, end of the period (Note 6)

 10,411,346 9,437,619

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

- 9 -

WOORI FINANCIAL GROUP INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS

AS OF JUNE 30, 2021 AND 2020 (UNAUDITED)

1.

GENERAL

(1)

Summary of the Parent company

Woori Financial Group, Inc. (hereinafter referred to the 'Parent company' or the 'Company') is primarily aimed at controlling subsidiaries that operate in the financial industry or those that are closely related to the financial industry through the ownership of shares and was established on January 11, 2019 under the Financial Holding Company Act through the comprehensive transfer with shareholders of Woori Bank (hereinafter referred to the 'Bank'), Woori FIS Co., Ltd., Woori Finance Research Institute Co., Ltd., Woori Credit Information Co., Ltd., Woori Fund Services Co., Ltd. and Woori Private Equity Asset Management Co. Ltd. The headquarters of the Parent company is located at 51, Sogong-ro,Jung-gu, Seoul, Korea, and the capital is 3,611,338 million Won as of June 30, 2021 while the Korea Deposit Insurance Corp. ('KDIC'), the Parent company's largest shareholder, owns 110,159,443 shares (15.25%) of the Parent company's stocks issued. The Company's stocks were listed on the Korea Exchange on February 13, 2019, and its American Depository Shares ('ADS') are also being traded as the underlying common stock on the New York Stock Exchange since the same date.

The details of stock transfer between the Parent company and subsidiaries as of incorporation are as follows (Unit: Number of shares)

Stock transfer company

Total number of
issued shares 		Exchange ratio
per share 		Number of Parent
company's stocks

Woori Bank

676,000,000 1.0000000 676,000,000

Woori FIS Co., Ltd.

4,900,000 0.2999708 1,469,857

Woori Finance Research Institute Co., Ltd.

600,000 0.1888165 113,289

Woori Credit Information Co., Ltd.

1,008,000 1.1037292 1,112,559

Woori Fund Service Co., Ltd.

2,000,000 0.4709031 941,806

Woori Private Equity Asset Management Co., Ltd.

6,000,000 0.0877992 526,795

As of August 1, 2019, the Parent company acquired a 73% interest in Tongyang Asset Management Co., Ltd. and changed the name to Woori Asset Management Corp. Also, as of August 1, 2019, the Parent company gained 100% control of ABL Asset Management Co., Ltd., added it as a consolidated subsidiary and changed the name to Woori Global Asset Management Co., Ltd. on December 6, 2019.

The Parent company paid 598,391 million Won in cash and 42,103,377 new shares of the Parent company to acquire 100% interest of Woori Card Co., Ltd. from its subsidiary, Woori Bank, on September 10, 2019. On the same date, the Parent company also acquired 59.8% interest of Woori Investment Bank Co., Ltd. from Woori Bank with 392,795 million Won in cash.

As of December 30, 2019, the Parent company acquired a 67.2% interest (excluding treasury stocks, 51% interest including treasury stocks) in Woori Asset Trust Co., Ltd. (formerly Kukje Asset Trust Co., Ltd.) and added it as a consolidated subsidiary at the end of 2019.

The Parent company acquired 76.8% (excluding treasury stocks, 74.0% interest including treasury stocks) interest in Woori Financial Capital Co., Ltd. (formerly Aju Capital Co., Ltd.) on December 10, 2020. In addition, as of April 15, 2021, the Group acquired 13.3% interests (excluding treasury stock, 12.9% when including treasury stock) in Woori Financial Capital Co., Ltd., and as of May 24, 2021, the Group additionally acquired treasury stock (3.6%) which Woori Financial Capital Co., Ltd. possessed.

The Parent Company paid 113,238 million Won in cash to acquire 100% interest of Woori Savings Bank from its subsidiary, Woori Financial Capital Co., Ltd., on March 12, 2021.

- 10 -

(2)

Details of the Parent company and subsidiaries (hereinafter referred to the 'Group') as of June 30, 2021 and December 31, 2020 are as follows:

Percentage of ownership
(%) 		Location

Financial
statements date
of use

Subsidiaries

Main business

June 30,
2021 		December 31,
2020

Held by Woori Financial Group Inc.

Woori Bank

Bank 100.0 100.0 Korea June 30

Woori Card Co., Ltd.

Finance 100.0 100.0 Korea June 30

Woori Financial Capital Co., Ltd.

Finance 90.5 76.8 Korea June 30

Woori Investment Bank Co., Ltd.

Other credit finance business 58.7 58.7 Korea June 30

Woori Asset Trust Co., Ltd.

Real estate trust 67.2 67.2 Korea June 30

Woori Asset Management Corp.

Finance 73.0 73.0 Korea June 30

Woori Savings Bank (*7)

Bank 100.0 - Korea June 30

Woori Credit Information Co., Ltd.

Credit information 100.0 100.0 Korea June 30

Woori Fund Service Co., Ltd.

Financial support service business 100.0 100.0 Korea June 30

Woori Private Equity Asset Management Co., Ltd.

Finance 100.0 100.0 Korea June 30

Woori Global Asset Management Co., Ltd.

Finance 100.0 100.0 Korea June 30

Woori FIS Co., Ltd.

System software development & maintenance 100.0 100.0 Korea June 30

Woori Finance Research Institute Co., Ltd.

Other service business 100.0 100.0 Korea June 30

Held by Woori Bank

Woori America Bank

Finance 100.0 100.0 America June 30

Woori Global Markets Asia Limited

Finance 100.0 100.0 Hong Kong June 30

Woori Bank China Limited

Finance 100.0 100.0 China June 30

AO Woori Bank

Finance 100.0 100.0 Russia June 30

PT Bank Woori Saudara Indonesia 1906 Tbk

Finance 79.9 79.9 Indonesia June 30

Banco Woori Bank do Brasil S.A.

Finance 100.0 100.0 Brazil June 30

Korea BTL Infrastructure Fund

Finance 99.9 99.9 Korea June 30

Woori Finance Myanmar Co., Ltd.

Finance 100.0 100.0 Myanmar June 30

Wealth Development Bank

Finance 51.0 51.0 Philippines June 30

Woori Bank Vietnam Limited

Finance 100.0 100.0 Vietnam June 30

WB Finance Co., Ltd. (*1)

Finance 100.0 100.0 Cambodia June 30

Woori Bank Europe

Finance 100.0 100.0 Germany June 30

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

Asset securitization 0.0 0.0 Korea June 30

Asiana Saigon Inc. (*2)

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 15.0 15.0 Korea June 30

Hermes STX Co., Ltd. (*2)

Asset securitization 0.0 0.0 Korea June 30

BWL First Co., LLC (*5)

Asset securitization - 0.0 Korea -

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

Asset securitization 0.0 0.0 Korea June 30

Jeonju Iwon Ltd. (*2)

Asset securitization 0.0 0.0 Korea June 30

Wonju I one Inc. (*2)

Asset securitization 0.0 0.0 Korea June 30

Heitz Third Co., Ltd. (*2)

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

Woori the Colony Unjung Securitization Specialty Co., Ltd. (*5)

Asset securitization - 0.0 Korea -

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

Woori Sinnonhyeon 1st Inc. (*2)

Asset securitization 0.0 0.0 Korea June 30

- 11 -

Percentage of ownership
(%) 		Location

Financial
statements date
of use

Subsidiaries

Main business

June 30,
2021 		December 31,
2020

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

Woori HJ 2nd Co., Ltd. (*5)

Asset securitization - 0.0 Korea -

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

Woori QSell 2nd Co., Ltd. (*5)

Asset securitization - 0.0 Korea -

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

ATLANTIC TRANSPORTATION 1 S.A. (*2)

Asset securitization 0.0 0.0 Marshall islands June 30

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

Asset securitization 0.0 0.0 Korea June 30

HD Project Co., Ltd. (*2)

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

SPG the 1st Co., Ltd. (*2)

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

Woori Park I 1st co., Ltd (*2)

Asset securitization 0.0 0.0 Korea June 30

Woori DS 1st co., Ltd (*2)

Asset securitization 0.0 0.0 Korea June 30

Woori HC 4th Co., Ltd. (*2).

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 - Korea June 30

HE the 1st Co.,Ltd. (*2)

Asset securitization 0.0 - Korea June 30

Woori Hub The 1st Co., Ltd. (*2)

Asset securitization 0.0 - Korea June 30

Woori K The 3rd Co., Ltd. (*2)

Asset securitization 0.0 - Korea June 30

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

Asset securitization 0.0 - Korea June 30

WooriI TS 1st Co., Ltd. (*2)

Asset securitization 0.0 - Korea June 30

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

Asset securitization 0.0 - Korea June 30

G5 Pro Short-term Bond Investment Fund 13 (*3)

Securities investment and others 100.0 100.0 Korea June 30

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

Securities investment and others 98.5 98.5 Korea June 30

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

Securities investment and others 97.3 97.3 England June 30

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

Securities investment and others 99.0 99.0 Korea June 30

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

Securities investment and others 99.4 99.4 Korea June 30

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

Securities investment and others 97.7 97.7 Korea June 30

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

Securities investment and others 98.8 98.8 Korea June 30

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

Securities investment and others 99.3 99.3 Korea June 30

Woori G Secondary Private Placement Investment Trust No. 1 (*3)

Securities investment and others 97.2 97.2 Korea June 30

WooriG Japan Blind Private Placement Real Estate Feeder Investment Trust No.1 (*3)

Securities investment and others 99.7 - Korea June 30

Principal Guaranteed Trust (*4)

Trust 0.0 0.0 Korea June 30

- 12 -

Percentage of ownership
(%) 		Location

Financial
statements date
of use

Subsidiaries

Main business

June 30,
2021 		December 31,
2020

Principal and Interest Guaranteed Trust (*4)

Trust 0.0 0.0 Korea June 30

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

MAGI No.5 LuxCo S.a.r.l. (*3)

Asset securitization 54.6 54.6 Luxembourg June 30

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

ADP 16 Brussels (*2)

Asset securitization 0.0 0.0 Belgium June 30

Held by Woori Card Co., Ltd.

TUTU Finance -WCI Myanmar Co., Ltd.

Finance 100.0 100.0 Myanmar June 30

Woori Card one of 2017-2 Securitization Specialty Co., Ltd. (*5)

Asset securitization - 0.5 Korea -

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

Asset securitization 0.5 0.5 Korea June 30

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

Asset securitization 0.5 0.5 Korea June 30

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

Asset securitization 0.5 0.5 Korea June 30

Held by Woori Financial Capital Co., Ltd.

Woori Savings Bank (*5)

Bank - 100.0 Korea -

ACE Auto Invest the 46th Securitization Specialty Co., Ltd. (*5)

Asset securitization - 1.0 Korea -

ACE Auto Invest the 47th Securitization Specialty Co., Ltd. (*2)

Asset securitization 1.0 1.0 Korea June 30

ACE Auto Invest the 48th Securitization Specialty Co., Ltd. (*2)

Asset securitization 1.0 1.0 Korea June 30

ACE Auto Invest the 49th Securitization Specialty Co., Ltd. (*2)

Asset securitization 1.0 1.0 Korea June 30

Specified Money Market Trust (*4)

Trust 100.0 100.0 Korea June 30

Held by Woori Investment Bank Co., Ltd.

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

Asset securitization 5.0 5.0 Korea June 30

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

Asset securitization 5.0 5.0 Korea June 30

Namjong 1st Securitization Specialty Co., Ltd. (*2)

Asset securitization 5.0 5.0 Korea June 30

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

Asset securitization 5.0 5.0 Korea June 30

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

Asset securitization 5.0 5.0 Korea June 30

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

Asset securitization 5.0 5.0 Korea June 30

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

Asset securitization 5.0 5.0 Korea June 30

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

Asset securitization 5.0 5.0 Korea June 30

WJ2008 Securitization Specialty Co., Ltd. (*2)

Asset securitization 5.0 5.0 Korea June 30

WH2103 Securitization Specialty Co., Ltd. (*2)

Asset securitization 5.0 - Korea June 30

WN2103 Securitization Specialty Co., Ltd. (*2)

Asset securitization 5.0 - Korea June 30

WH2106 Securitization Specialty Co., Ltd. (*2)

Asset securitization 5.0 - Korea June 30

- 13 -

Percentage of ownership
(%) 		Location

Financial
statements date
of use

Subsidiaries

Main business

June 30,
2021 		December 31,
2020

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 0.0 Korea June 30

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

Asset securitization 0.0 - Korea June 30

Held by Woori Asset Management Corp.

Woori China Convertible Bond Hedging feeder Investment Trust H (debt-oriented hybrid) (*5)

Securities investment and others - 99.6 Korea -

Woori China Convertible Bond Master Fund (debt-oriented hybrid) (*5)(*8)

Securities investment and others - 34.5 Korea -

Woori Yellow Chip High Yield Strategic Allocation 1 (FOF) (*5)

Securities investment and others - 89.8 Korea -

Woori Together TDF 2025 (*3)

Securities investment and others 43.3 47.6 Korea June 30

Woori Together TDF 2030 (*3)

Securities investment and others 41.9 47.4 Korea June 30

Woori Together TDF 2035 (*3)

Securities investment and others 45.1 47.8 Korea June 30

Woori Together TDF 2040 (*3)

Securities investment and others 44.1 48.8 Korea June 30

Woori Together TDF 2045 (*3)

Securities investment and others 42.4 47.7 Korea June 30

Woori Together TDF 2050 (*3)

Securities investment and others 67.3 87.0 Korea June 30

Woori Star50 Feeder Fund(H) (*3)

Securities investment and others 45.1 - Korea June 30

Woori Star50 Master Fund (*3)(*8)

Securities investment and others 69.3 - Korea June 30

Woori BIG2 Plus Securities Investment Trust(Balanced Bond) (*3)

Securities investment and others 65.7 - Korea June 30

Held by Woori Financial Capital Co., Ltd., Woori Private Equity Asset Management Co., Ltd. and Woori Investment Bank Co., Ltd. (*6)

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

Securities investment and others 100.0 100.0 Korea June 30

Held by Woori Global Asset Management Co., Ltd.

Woori G Global Multi Asset Income Private Placement Investment Trust_Class Cs (*3)

Securities investment and others 22.2 22.2 Korea June 30

Held by Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd., Woori Savings Bank and Woori Private Equity Asset Management Co., Ltd. (*6)

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

Securities investment and others 90.0 90.0 Korea June 30

Held by Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd. and Woori Private Equity Asset Management Co., Ltd. (*6)

Woori Innovative Growth Professional Investment Type Private Investment Trust No.2 (*3)

Securities investment and others 85.0 85.0 Korea June 30

- 14 -

Percentage of ownership
(%)

Location

Financial

statements date

of use

Subsidiaries

Main business

June 30,
2021 		December 31,
2020

Held by Woori Bank, Woori Financial Capital Co., Ltd. and Woori Investment Bank Co., Ltd. (*6)

WooriG GP Commitment Loan Private Placement Investment Trust No.1 (*3)

Securities investment and others 100.0 50.0 Korea June 30

Held by Woori bank and Woori Investment Bank Co., Ltd. (*6)

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

Securities investment and others 100.0 100.0 Korea June 30

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

Securities investment and others 100.0 100.0 Korea June 30

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

Securities investment and others 100.0 100.0 Korea June 30

Woori G Infrastructure New Deal Specialized Investment Private Equity Investment Trust No. 1 (*3)

Securities investment and others 100.0 100.0 Korea June 30

Woori G Private Placement Real Estate Investment Trust No.2 (*3)

Securities investment and others 30.1 30.1 Korea June 30

Held by Woori bank (*6)

Woori G Woori Bank Partners Private Placement Investment Trust No. 1 (*3)

Securities investment and others 92.6 92.6 Korea June 30

Woori G Private Placement Real Estate Investment Trust No.1[USD] (*3)

Securities investment and others 80.0 80.0 Korea June 30

WooriG Global Mid-market Secondaries Private Placement Investment Trust No.1 (EUR) (*3)

Securities investment and others 80.0 80.0 Korea June 30

Held by Woori Financial Capital Co., Ltd.

Woori G Japan Private Placement Real Estate Feeder Investment Trust No.1-1 (*3)

Securities investment and others 63.2 63.2 Korea June 30

Held by Woori G Japan Private Placement Real Estate Feeder Investment Trust No.1-1 and Woori G Japan Investment Trust No. 1-2

Woori G Japan Private Placement Real Estate Master Investment Trust No.1 (*3)

Securities investment and others 100.0 100.0 Korea June 30

Held by Woori Financial Capital Co., Ltd. and Woori Investment Bank Co., Ltd. (*6)

Woori G Japan Private Placement Real Estate Master Investment Trust No.2-1 (*3)

Securities investment and others 100.0 - Korea June 30

Held by Woori G Japan Private Placement Real Estate Master Investment Trust No.1 and Woori G Japan Private Placement Real Estate Master Investment Trust No.2-1

Woori G Japan Private Placement Real Estate Master Investment Trust No.2 (*3)

Securities investment and others 100.0 - Korea June 30

- 15 -

Percentage of ownership
(%)

Location

Financial

statements date

of use

Subsidiaries

Main business

June 30,
2021 		December 31,
2020

Held by Woori G Japan Private Placement Real Estate Master Investment Trust No.1

GK OK Chatan (*3)

Other financial services 99.9 99.9 Japan June 30
(*1)

The entity was merged with WB Finance Co., Ltd., which is a second-tier subsidiary, during prior period.

(*2)

The entity is a structured entity for the purpose of asset securitization. Although the Group is not a majority shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns.

(*3)

The entity is a structured entity for the purpose of investment in securities. Although the Group is not a majority shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns.

(*4)

The entity is a 'money trust' under the Financial Investment Services and Capital Markets Act. Although the Group is not a majority shareholder, the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns.

(*5)

Companies are excluded from the consolidation as of June 30, 2021.

(*6)

Determined that the Group controls the investees, considering the Group 1) has the power over the investee, 2) is exposed to or has rights to variable returns from its involvement with the investee, and 3) has the ability to use its power to affect its returns, by two or more subsidiaries' investment or operation.

(*7)

During March 2021, the Company acquired a 100% equity of Woori Financial Savings Bank from the company's subsidiary Woori Financial Capital Co., Ltd. which makes a business combination under the same control. For business combinations under the same control, the company accounts the business combination in the carrying amount method, and the assets and liabilities transferred are measured at the carrying amount included in the consolidated financial statements. The amounts of assets and liabilities transferred due to the business combination are 1,119,371 million won and 1,084,771 million, respectively.

(*8)

As a master-feeder fund, the equity ratio is the equity of the subsidiary in parent fund.

- 16 -

(3)

The Group has not consolidated the following entities as of June 30, 2021 and December 31, 2020 despite having more than 50% ownership interest:

As of June 30, 2021

Subsidiaries

Location Main Business Percentage of
ownership (%)

Mirae Asset Maps Clean Water Private Equity Investment Trust 7th (*)

Korea Securities Investment 59.7

Kiwoom Yonsei Private Equity Investment Trust (*)

Korea Securities Investment 88.9

IGIS Europe Private Placement Real Estate Fund No. 163-2 (*)

Korea Securities Investment 97.9

IGIS Global Private Placement Real Estate Fund No. 148-1 (*)

Korea Securities Investment 75.0

IGIS Global Private Placement Real Estate Fund No. 148-2 (*)

Korea Securities Investment 75.0

Mirae Asset Seoul Ring Expressway Private Special Asset Fund No. 1 (*)

Korea Securities Investment 66.7

Hangkang Sewage Treatment Plant Fund (*)

Korea Securities Investment 55.6

KIM Pocheon-Hwado Highway Infra Private Placement Special Asset Fund (*)

Korea Securities Investment 55.2

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

Korea Securities Investment 96.7

Kiwoom-Harmony Private Placement Investment Trust No.1 (*)

Korea Securities Investment 95.7

Midas Global Private Placement Real Estate Investment Trust No. 7-2 (*)

Korea Securities Investment 58.3

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

Korea Securities Investment 100.0

INMARK France Private Placement Investment Trust No. 18-1 (*)

Korea Securities Investment 93.8

Kiwoom Vibrato Private Placement Investment Trust 1-W(EUR) (*)

Korea Securities Investment 99.4

KOTAM Global Infra Private Fund 1-4 (*)

Korea Securities Investment 99.7

JB Airline Professional investor type private placement fund 8 (*)

Korea Securities Investment 96.7

UBSHana Class 1 Special Asset Investment Trust 3 Class C (*)

Korea Securities Investment 51.0

Kiwoom Bright Light Professional Private Investment Trust (*)

Korea Securities Investment 50.0

Consus GyeongJuGreen Specialized Private Special Asset Investment Trust 1 (*)

Korea Securities Investment 50.0

Consus Solar Energy Private Special Asset Investment Trust (*)

Korea Securities Investment 50.0
(*)

Since the investee is a private equity investment fund, the Group does not have the power over the fund's activities even though it holds more than 50% of ownership interest.

As of December 31, 2020

Subsidiaries

Location Main Business Percentage of
ownership (%)

Mirae Asset Maps Clean Water Private Equity Investment Trust 7th (*)

Korea Securities Investment 59.7

Kiwoom Yonsei Private Equity Investment Trust (*)

Korea Securities Investment 88.9

IGIS Europe Private Placement Real Estate Fund No. 163-2 (*)

Korea Securities Investment 97.9

IGIS Global Private Placement Real Estate Fund No. 148-1 (*)

Korea Securities Investment 75.0

IGIS Global Private Placement Real Estate Fund No. 148-2 (*)

Korea Securities Investment 75.0

Mirae Asset Seoul Ring Expressway Private Special Asset Fund No. 1 (*)

Korea Securities Investment 66.7

Hangkang Sewage Treatment Plant Fund (*)

Korea Securities Investment 55.6

KIM Pocheon-Hwado Highway Infra Private Placement Special Asset Fund (*)

Korea Securities Investment 55.2

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

Korea Securities Investment 96.3

Kiwoom-Harmony Private Placement Investment Trust No.1 (*)

Korea Securities Investment 95.7

Midas Global Private Placement Real Estate Investment Trust No. 7-2 (*)

Korea Securities Investment 58.3

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

Korea Securities Investment 100.0

INMARK France Private Placement Investment Trust No. 18-1 (*)

Korea Securities Investment 93.8

Kiwoom Vibrato Private Placement Investment Trust 1-W(EUR) (*)

Korea Securities Investment 99.3
(*)

Since the investee is a private equity investment fund, the Group does not have the power over the fund's activities even though it holds more than 50% of ownership interest.

- 17 -

(4)

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

As of June 30, 2021 For the six-month period ended June 30, 2021

Subsidiaries

Assets Liabilities Operating
revenue 		Net income
(loss)
attributable to
owners 		Comprehensive
income (loss)
attributable to
owners

Woori Bank

393,520,653 369,318,152 11,760,294 1,279,637 1,429,762

Woori Card Co., Ltd.

12,645,157 10,467,730 741,298 121,435 126,396

Woori Financial Capital Co., Ltd.

8,761,211 7,831,718 422,966 82,527 83,600

Woori Investment Bank Co., Ltd.

4,860,424 4,296,271 149,233 44,035 44,015

Woori Asset Trust Co., Ltd.

211,428 61,779 42,764 21,571 21,557

Woori Asset Management Corp.

134,799 17,274 16,067 4,422 4,476

Woori Savings Bank

1,286,793 1,071,240 36,648 9,262 8,859

Woori Credit Information Co., Ltd.

41,084 9,513 18,947 1,109 1,106

Woori Fund Service Co., Ltd.

19,625 2,097 7,452 1,512 1,512

Woori Private Equity Asset Management Co., Ltd.

40,731 1,059 1,963 3,706 3,647

Woori Global Asset Management Co., Ltd.

38,589 10,356 6,414 105 105

Woori FIS Co., Ltd.

87,078 58,368 130,485 (9,075 ) (9,193 )

Woori Finance Research Institute Co., Ltd.

6,387 2,958 3,410 (107 ) (114 )
As of June 30, 2020 For the six-month period ended June 30, 2020

Subsidiaries

Assets Liabilities Operating
revenue 		Net income
(loss)
attributable
to owners 		Comprehensive
income (loss)
attributable to
owners

Woori Bank

374,310,415 350,790,158 13,836,037 677,937 696,858

Woori Card Co., Ltd.

11,366,596 9,312,986 708,328 79,654 50,029

Woori Financial Capital Co., Ltd. (*)

8,880,117 8,053,840 - - -

Woori Investment Bank Co., Ltd.

4,332,474 3,803,594 135,093 31,435 31,301

Woori Asset Trust Co., Ltd.

185,634 56,396 128,979 2,220 2,152

Woori Asset Management Corp.

136,460 23,411 3,169 242 242

Woori Credit Information Co., Ltd.

40,860 9,830 20,774 1,469 1,311

Woori Fund Service Co., Ltd.

18,957 2,172 6,300 990 990

Woori Private Equity Asset Management Co., Ltd.

38,035 2,009 39,079 20,198 20,177

Woori Global Asset Management Co., Ltd.

37,935 9,807 12,059 3,183 2,771

Woori FIS Co., Ltd.

97,479 59,577 2,424 74 28

Woori Finance Research Institute Co., Ltd.

7,232 3,689 5,602 (760 ) (760 )
(*)

Since Woori Financial Capital Co., Ltd. has acquired control after the end of the first half of last year, operating income, profit or loss from the parent company, and total comprehensive income of the parent company have not been prepared.

- 18 -

(5)

The financial support that the Group provides to consolidated structured entities is as follows:

•

Structured entity for asset securitization

The structured entity which is established for the purpose of securitization of project financing loans, corporate bonds, and other financial assets. The Group is involved with the structured entity through provision of credit facility over asset-backed commercial papers issued by the entity, originating loans directly to the structured entity, or purchasing 100% of the subordinated debts issued by the structured entity.

•

Structured entity for the investments in securities

The structured entity is established for the purpose of investments in securities. The Group acquires beneficiary certificates through its contribution of funding to the structured entity by the Group, and it is exposed to the risk that it may not be able to recover its fund depending on the result of investment performance of asset managers of the structured entity.

•

Money trust under the Financial Investment Services and Capital Markets Act

The Group provides with financial guarantee of principal and interest or solely principal to some of its trust products. Due to the financial guarantees, the Group may be obliged when the principal and interest or principal of the trust product sold is short of the guaranteed amount depending on the result of investment performance of the trust product.

As of June 30, 2021 and December 31, 2020, the Group provides 2,775,207 million Won and 2,547,418 million Won of credit facilities, respectively, for the structured entities mentioned above. As of June 30, 2021 and December 31, 2020, the purchase commitment amounts to 1,186,872 million Won and 854,231 million Won, respectively.

- 19 -

(6)

The Group has entered into various agreements with structured entities such as asset securitization, structured finance, investment fund, and monetary trust. The characteristics and the nature of risks related to unconsolidated structured entities over which the Group does not have control in accordance with Korean IFRS 1110 are as follows:

The interests in unconsolidated structured entities that the Group hold are classified into asset securitization vehicles, structured finance, investment fund and real-estate trust, based on the nature and the purpose of each structured entity.

Unconsolidated structured entities classified as 'asset securitization vehicles' are entities that issue asset-backed securities, pay the principal and interest or distributes dividends on asset-backed securities through borrowings or profits from the management, operation and sale of securitized assets. The Group has been purchasing commitments of asset-backed securities or issuing asset-backed securities through credit grants, and the structured entities recognize related interest or fee revenue. There are entities that provide additional funding and conditional debt acquisition commitments before the Group's financial support, but the Group is still exposed to losses arising from the purchase of financial assets issued by the structured entities when it fails to renew the securities.

Unconsolidated structured entities classified as 'structured financing' include real estate project financing investment vehicle, social overhead capital companies, and special purpose companies for ship (aircraft) financing. Each entity is incorporated as a separate company with a limited purpose in order to efficiently pursue business goals. 'Structured financing' is a financing method for large-scale risky business, with investments made based on feasibility of the specific business or project, instead of credit of business owner or physical collaterals. The investors receive profits from the operation of the business. The Group recognizes interest revenue, profit or loss from assessment or transactions of financial instruments, or dividend income. With regard to uncertainties involving structured financing, there are entities that provide financial support such as additional fund, guarantees and prioritized credit grants prior to the Group's intervention, but the Group is exposed to possible losses due to loss of principal from reduction in investment value or irrecoverable loans arising from failure to collect scheduled cash flows and cessation of projects.

Unconsolidated structured entities classified as 'investment funds' include investment trusts and private equity funds. An investment trust orders the investment and operation of funds to the trust manager in accordance with trust contract with profits distributed to the investors. Private equity funds finances money required to acquire equity securities to enable direction of management and/or improvement of ownership structure, with profit distributed to the investors. The Group recognizes pro rata amount of valuation gain or loss on investment and dividend income as an investor and may be exposed to losses due to reduction in investment value. Investments in MMF (Money Market Funds) as of June 30, 2021 and December 31, 2020 are 631,711 million Won and 427,375 million Won, respectively, and there are no additional commitments for MMF.

'Real estate trust' is to be entrusted the underlying property for the purpose of managing, disposing, operating or developing from the consignor who owns the property and distributes the proceeds achieved through the trust to the beneficiary. When the consignee does not fulfill his or her important obligations in the trust contract or it is, in fact, difficult to run the business, the Group may be exposed to the threat of compensating the loss.

The total assets of the unconsolidated structured entity held by the Group, the carrying amount of the items recognized in the consolidated financial statements, the maximum loss exposure, and the losses from the unconsolidated structured entity are as follows. The maximum loss exposure includes the amount of investment recognized in the consolidated financial statements and the amount that is likely to be confirmed in the future when satisfies certain conditions by contracts such as purchase arrangements, credit offerings. As of June 30, 2021 and December 31, 2020, the purchase commitment amounts to 3,353,699 million Won and 4,266,319 million Won, respectively.

- 20 -

June 30, 2021
Asset
securitization
vehicle 		Structured
Finance 		Investment
Funds 		Real-estate
trust

Total asset of the unconsolidated structured entities

4,624,493 87,656,926 67,190,894 1,389,925

Assets recognized in the consolidated financial statements related to the unconsolidated structured entities

469,057 4,345,802 4,388,319 37,894

Financial assets at FVTPL

315,128 8,771 3,790,995 12,875

Financial assets at FVTOCI

39,931 46,932 - -

Financial assets at amortized cost

113,222 4,286,364 39,956 25,019

Investments in joint ventures and associates

- - 557,368 -

Derivative assets

776 3,735 - -

Liabilities recognized in the consolidated financial statements related to the unconsolidated structured entities

212 1,235 - 2,010

Other liabilities (provisions)

212 1,235 - 2,010

The maximum exposure to risks

765,467 5,422,983 4,395,395 97,538

Investment assets

469,057 4,345,802 4,388,319 37,894

Credit facilities and others

296,410 1,077,181 7,076 59,644

Loss recognized on unconsolidated structured entities

- 2,161 16,193 111
December 31, 2020
Asset
securitization
vehicle 		Structured
Finance 		Investment
Funds 		Real-estate
trust

Total asset of the unconsolidated structured entities

3,900,254 69,010,369 44,629,638 76,772

Assets recognized in the consolidated financial statements related to the unconsolidated structured entities

648,700 4,291,535 3,350,605 22,402

Financial assets at FVTPL

374,231 167,271 2,922,716 -

Financial assets at FVTOCI

163,808 41,378 - -

Financial assets at amortized cost

109,008 4,072,321 39,955 22,402

Investments in joint ventures and associates

- 5,958 387,902 -

Derivative assets

1,653 4,607 32 -

Liabilities recognized in the consolidated financial statements related to the unconsolidated structured entities

130 963 - 400

Other liabilities (provisions)

130 963 - 400

The maximum exposure to risks

970,628 5,366,037 3,438,924 65,722

Investment assets

648,700 4,291,535 3,350,605 22,402

Credit facilities and others

321,928 1,074,502 88,319 43,320

Loss recognized on unconsolidated structured entities

- 6,079 25,454 2,363

- 21 -

(7)

As of June 30, 2021 and December 31, 2020, the share of non-controlling interests on the net income and equity of subsidiaries in which non-controlling interests that are significant are as follows (Unit: Korean Won in millions):

1)

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

June 30, 2021 December 31, 2020

Woori Bank (*)

3,105,070 3,105,070

Woori Financial Capital Co., Ltd.

69,081 166,369

Woori Investment Bank Co., Ltd.

237,000 222,289

Woori Asset Trust Co., Ltd.

55,517 49,738

Woori Asset Management Corp

32,502 31,369

PT Bank Woori Saudara Indonesia 1906 Tbk

83,255 79,890

Wealth Development Bank

20,513 19,521
(*)

Hybrid securities issued by Woori Bank

2)

Net income attributable to non-controlling interests

For the six-month
periods ended June 30
2021 2020

Woori Bank (*)

71,537 90,091

Woori Financial Capital Co., Ltd.

16,329 -

Woori Investment Bank Co., Ltd.

18,330 12,753

Woori Asset Trust Co., Ltd.

6,149 5,699

Woori Asset Management Corp

1,119 791

PT Bank Woori Saudara Indonesia 1906 Tbk

3,512 3,796

Wealth Development Bank

559 321
(*)

Distribution of the hybrid securities issued by Woori Bank

3)

Dividends to non-controlling interests

For the six-month
periods ended June 30
2021 2020

Woori Bank (*)

71,537 90,091

Woori Financial Capital Co., Ltd.

4,121 -

Woori Investment Bank Co., Ltd.

3,610 -

Woori Asset Trust Co., Ltd

365 365

PT Bank Woori Saudara Indonesia 1906 Tbk

1,262 1,669
(*)

Distribution of the hybrid securities issued by Woori Bank

- 22 -

2.

BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES

The Group maintains its accounting records in Korean won and prepares statutory financial statements in the Korean language (Hangul) in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (Korean IFRS). The accompanying consolidated interim financial statements have been condensed, restructured and translated into English from the Korean language financial statements. The Group's condensed consolidated interim financial statements are condensed interim financial statements prepared in applying International Financial Reporting Standards as adopted by the Republic of Korea ('Korean IFRS') 1034 Interim Finance Reporting for some of periods in which the annual consolidated financial statements belong. It is necessary to use the Group's annual consolidated financial statements for the year ended December 31, 2020 for understanding of the accompanying condensed consolidated interim financial statements.

(1)

From the accounting period beginning on January 1, 2021, the Group has newly applied the following standards and interpretations.

1)

Korean IFRS 1109 'Financial Instruments', Korean IFRS 1039 'Financial Instruments: Recognition and Measurement', Korean IFRS 1107 'Financial Instruments: Disclosures', Korean IFRS 1104 'Insurance Contracts' and Korean IFRS 1116 'Lease'; Interest Rate Benchmark Reform-Phase 2

The amendment indicates that the effective interest rate shall be adjusted rather than the carrying amount when changing the interest rate benchmark for financial instruments measured at amortized cost. In addition, it allows hedge accounting to continue without interruption even when changes to interest rate benchmark occur in the hedging relationship. The amendment does not have a significant impact on the consolidated financial statements.

The Group has applied 'Interest Rate Benchmark Reform-Phase 2', which is an amendment to Korean IFRS 1109, 1039, 1107 and 1116, beginning on January 1, 2021. In accordance with the transition provisions, the amendments were applied retrospectively to the hedging relationship and financial instruments. The comparative financial statements have not been restated and there is no effect of the adoption of the amendments on the beginning balance of reserves.

①

Hedging relationship

The Phase 2 amendments address issues arising from 'Interest Rate Benchmark Reform-Phase 1', including when the designation and documentation of hedges should be updated and when alternative rates are permitted as hedged risk.

The Phase 1 amendments include an exceptional regulation that temporarily mitigates the application of specific hedge accounting requirements to hedging relationships directly affected by 'Interest Rate Benchmark Reform'. Due to this mitigation, 'Interest Rate Benchmark Reform' typically does not stop hedge accounting until there is a change of the contract. However, hedge ineffectiveness continues to be recorded in the income statement. It also suggests when the application of these exceptions should end, for instance, exceptional regulation should end when uncertainties due to 'Interest Rate Benchmark Reform' no longer appear.

- 23 -

For the period beginning January 1, 2021, the Group has applied the following hedge accounting mitigation provisions provided in the Phase 2 amendments:

Designation of a hedging relationship: When the Phase 1 amendments cause to apply, the Group will reflect the changes required by the Interest Rate Benchmark Reform by amending the formal designation of the hedging relationship as previously documented to make one or more of these changes: will amend the designation of a hedging relationship to reflect the changes required by the Interest Rate Benchmark Reform when there is a change in one or more of the followings:

•

Designating the alternative benchmark rate (contractually or non-contractually specified) as a hedged risk;

•

Amending the description of the hedged item so it refers to the alternative benchmark rate; or

•

Amending the description of the hedging instrument.

The Group will amend the hedging relationship documentation to reflect these amendments by the end of the reporting period during which the changes are made. These amendments do not require the discontinuance of the hedging relationship.

②

Financial instruments measured at amortized cost

For financial instruments measured at amortized cost (including financial assets at FVTOCI-debt instruments), the Phase 2 amendments do not require the financial instrument to recognize gains or losses from the change because the change in the contractual cash flow basis required by the interest rate reform is reflected by adjusting the effective interest rate.

A similar practical expedient exists for lease liabilities. This practical expedient is applicable only to changes required by interest rate indicator reform. When the changes are necessary as a direct result of Interest Rate Benchmark Reform and the new criteria for determining contractual cash flows are economically equivalent to the previous one, it is considered as a required change due to Interest Rate Benchmark Reform.

If some or all of the changes in the instrument's contractual cash flow calculation criteria do not meet the above criteria, the Group shall first apply the practical expedient to the changes made under the Interest Rate Benchmark Reform and then apply the general financial instrument requirements(In other words, the entity shall determine whether a modification or elimination is made and recognizes immediately in profit or loss any modification on financial instrument which has not been eliminated).

For lease liabilities which basis for determining contractual cash flows is changed, as a practical expedient, the lease liabilities are remeasured at a discount rate that reflects the change in interest rates due to the Interest Rate Benchmark Reform. If an additional lease change is made in addition to the lease changes required by the Interest Rate Benchmark Reform, the general requirements of Korean IFRS 1116 apply to the accounting for all simultaneous lease changes, including those required by the Interest Rate Benchmark Reform.

- 24 -

The details of Woori Bank's financial instruments that have not completed the conversion to interest rates benchmark at the end of the quarter are as follows: Non-derivative financial instrument is at the carrying amount, while the derivative financial instrument and commitments/financial guarantee is at the nominal amount.

USD EUR GBP JPY CHF Total

Non-derivative financial assets

Financial assets at FVTOCI

620,409 - - - - 620,409

Financial assets at amortized cost

3,596,622 44,643 161,747 75,895 - 3,878,907

Sub-total

4,217,031 44,643 161,747 75,895 - 4,499,316

Non-derivative financial liabilities

Financial liabilities at amortized cost

931,120 12,796 21,648 - - 965,564

Derivative finance

Interest rate related(trading)

18,130,913 - 393,354 620,631 1,227 19,146,125

Currency related(trading)

26,558,352 - 398,046 172,031 - 27,128,429

Interest rate related(hedging)

2,090,500 - - - - 2,090,500

Sub-total

46,779,765 - 791,400 792,662 1,227 48,365,054

Commitments and financial guarantee

- 5,902 - 1,840 - 7,742
2)

Amendments to Korean IFRS 1116 Lease - COVID-19 related rent concession continuously offered after June 30, 2021

As a practical expedient, a lessee may elect not to assess whether a rent concession occurring as a direct consequence of the COVID-19 pandemic is a lease modification. The scope of the practical expedient has been expanded to reduce lease fees that affect lease payments due on or before June 30, 2022. Lessee should consistently apply practical expedients to contracts with similar characteristics in similar circumstances.

(2)

The details of Korean IFRSs that have been issued and published since January 1, 2021 but have not yet reached the effective date are as follows:

1)

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

The amendments update a reference of definition of assets and liabilities qualify for recognition in revised Conceptual Framework for Financial Reporting. However, the amendments add an exception for the recognition of liabilities and contingent liabilities within the scope of Korean IFRS 1037 Provisions, Contingent Liabilities and Contingent Assets, and Korean IFRS 2121 Levies. The amendments also confirm that contingent assets should not be recognized at the acquisition date. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

- 25 -

2)

Amendments to Korean IFRS 1016 Property, plant and equipment - Proceeds before intended use

The amendments prohibit an entity from deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while the entity is preparing the asset for its intended use. Instead, the entity will recognize the proceeds from selling such items, and the costs of producing those items, in profit or loss. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

3)

Amendments to Korean IFRS 1037 Provisions, Contingent Liabilities and Contingent Assets - Onerous Contracts: Cost of Fulfilling a Contract

The amendments clarify that the direct costs of fulfilling a contract include both the incremental costs of fulfilling the contract and an allocation of other costs directly related to fulfilling contracts when assessing whether the contract is onerous. The amendments should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

4)

Annual Improvements to Korean IFRS 2018-2020

Annual improvements of Korean IFRS 2018-2020 Cycle should be applied for annual periods beginning on or after January 1, 2022, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

•

Korean IFRS 1101 First time Adoption of Korean International Financial Reporting Standards - Subsidiaries that are first-time adopters

•

Korean IFRS 1109 Financial Instruments - Fees related to the 10% test for derecognition of financial liabilities

•

Korean IFRS 1116 Leases - Lease incentives

•

Korean IFRS 1041 Agriculture - Measuring fair value

5)

Amendments to Korean IFRS 1001 Presentation of Financial Statements - Classification of Liabilities as Current or Non-current

The amendments clarify that liabilities are classified as either current or non-current, depending on the substantive rights that exist at the end of the reporting period. Classification is unaffected by the likelihood that an entity will exercise right to defer settlement of the liability or the expectations of management. Also, the settlement of liability include the transfer of the entity's own equity instruments, however, it would be excluded if an option to settle them by the entity's own equity instruments if compound financial instruments is met the definition of equity instruments and recognized separately from the liability. The amendments should be applied for annual periods beginning on or after January 1, 2023, and earlier application is permitted. The Group does not expect that these amendments have a significant impact on the consolidated financial statements.

The above enacted or amended standards will not have a significant impact on the Group.

(3)

Significant accounting policies and method of computation used in the preparation of the condensed consolidated interim financial statements are consistent with those of the consolidated financial statements for the year ended December 31, 2020, except for the one described below.

•

Income tax expense

Income tax expense for the interim period is recognized based on management's best estimate of the weighted average annual income tax rate expected for the full financial year. The estimated average annual tax rate is applied to the pre-tax income.

- 26 -

3.

SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS

The outbreak of COVID-19 has had a significant impact on the global economy including Korea. Financial and economic shocks may have negative impacts on the Group's financial condition and results of operations in various forms both domestically and internationally, however, the Korean government is providing unprecedented financial and economic relief measures such as extension of maturity of loans. Despite the announcement of these various forms of government support policies, the negative impact of the COVID-19 on the global economy continues, and uncertainties in recovery or deterioration will persist.

The Group will continue to assess the adequacy of forward-looking information related to the duration of the impact of COVID-19 on economy and government policies.

The Bank determined that the credit risk of loans affected by the loan deferment has significantly increased; and evaluated that the possibility of default is high. As a result, total loans (Loans, payment guarantees) that are subject to loan deferment and interest deferment amount to 2,064,566 million Won, and expected credit loss allowance have increased for 209,223 million Won (199,915 million Won of corporate loan).

Total loans (Loans, payment guarantees) that are subject to loan deferment and interest deferment consist of corporate loan of 1,908,095 million Won and retail loan of 156,471 million Won. Among total loans, loans changed its stage from 12-month to lifetime (Stage 2) expected credit losses amount to 1,723,997 million Won, which consist of corporate loan of 1,596,024 million Won and retail loan of 127,973 million Won.

Woori Card Co., Ltd. determined that the credit risk of obligors receiving financial support due to COVID-19 significantly increased, and transferred the loss allowance at the amount equivalent to lifetime expected credit loss. As of June 30, 2021, financial assets at amortized cost of obligors subject to loan deferment and interest deferment amount to 7,744 million Won, and the cumulative expected credit loss allowance have increased for 179 million Won

Management shall make judgments, estimates and assumptions that affect the application of accounting policies and application of assets, liabilities and revenues and expenses in preparing condensed consolidated interim financial statements. Therefore, the actual results may differ from these estimates.

The important decisions made by management on the application of accounting policy of the Group and the main sources of estimation uncertainty in preparing condensed consolidated interim financial statements are the same as those applied to the consolidated financial statements for the year ended December 31, 2020, unless otherwise stated.

- 27 -

4.

RISK MANAGEMENT

The Group's operating activity is exposed to various financial risks and the and the main types of risks are credit risk, market risk, liquidity risk, etc. The risk management department analyze and assess the level of complex risks in order to manage the risks and the risk management standards such as policies, regulations, management systems and decision-making have been established and operated for sound management of the Group.

The risk management organization is operated by risk management committee, risk management responsible, and risk management department. The Board of Directors operates a risk management committee comprised of outside directors for professional risk management. The risk management committee plays a role as the top decision-making body in risk management by establishing basic policies for risk management that are in line with the Group's management strategy and determining the risk level that the Group is willing to take. The risk management officer (CRO) assists the risk management committee and operates a group risk management council comprised of risk management managers of subsidiaries to periodically check and improve the risk burden of external environments and the Group. The risk management department is independent and is in charge of risk management of the Group. It also supports reporting and decision-making of key risk-related issues.

(1)

Credit risk

Credit risk represents the possibility of financial losses incurred due to the refusal of the transaction or when the counterparty fails to fulfill its contractual obligations. The goal of credit risk management is to maintain the Group's credit risk exposure to a permissible degree and to optimize its rate of return considering such credit risk.

1)

Credit risk management

The Group considers the probability of failure in performing the obligation of its counterparties, credit exposure to the counterparty, the related default risk and the rate of default loss. The Group uses the credit rating model to assess the possibility of counterparty's default risk; and when assessing the obligor's credit grade, other than quantitative methods utilizing financial statements and others, and assessor's judgement, the Group utilizes credit grades derived using statistical methods.

In order to manage credit risk limit, the Group establishes the appropriate credit line per obligor, company or industry. It monitors obligor's credit line, total exposures and loan portfolios when approving the loan.

The Group mitigates credit risk resulting from the obligor's credit condition by using financial and physical collateral, guarantees, netting agreements and credit derivatives. The Group has adopted the entrapment method to mitigate its credit risk. Credit risk mitigation is reflected in qualifying financial collateral, trade receivables, guarantees, residential and commercial real estate and other collaterals. The Group regularly performs a revaluation of collateral reflecting such credit risk mitigation.

- 28 -

2)

Maximum exposure

The Group's maximum exposure to credit risk shows the uncertainties related to the maximum possible variation of financial assets' net value as a result of changes in the specific risk factors, prior to the consideration of collaterals that are recorded at net book value after allowances and other credit enhancements. However, the maximum exposure is the fair value amount (recorded on the books) for derivatives, maximum contractual obligation for payment guarantees and unused amount of commitments for loan commitment.

The maximum exposure to credit risk as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Loans and other financial assets at amortized cost (*1)

Korean treasury and government agencies 20,639,049 9,725,719
Banks 18,674,050 19,493,188
Corporates 122,677,013 114,131,996
Consumers 183,160,313 176,755,175

Sub-total

345,150,425 320,106,078

Financial assets at FVTPL (*2)

Deposit 70,150 48,796
Debt securities 2,496,924 2,887,097
Loans 431,137 676,291
Derivative assets 4,024,668 6,901,742

Sub-total

7,022,879 10,513,926

Financial assets at FVTOCI

Debt securities 29,050,792 28,948,141

Securities at amortized cost

Debt securities 15,725,241 17,020,839

Derivative assets

Derivative assets (Designated for hedging) 129,562 174,820

Off-balance accounts

Guarantees (*3) 12,354,750 11,809,456
Loan commitments 114,270,804 112,088,680

Sub-total

126,625,554 123,898,136

Total

523,704,453 500,661,940
(*1)

Cash and cash equivalents are not included.

(*2)

Puttable financial instruments are not included.

(*3)

As of June 30, 2021 and December 31, 2020, the financial guarantee amounts of 4,014,532 million Won and 4,163,382 million Won are included, respectively.

- 29 -

a)

Credit risk exposure by geographical areas

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

June 30, 2021
Korea China USA UK Japan Others (*) Total

Loans and other financial assets at amortized cost

325,425,315 4,677,171 3,378,362 217,790 674,543 10,777,244 345,150,425

Securities at amortized cost

15,391,303 148,257 30,422 - - 155,259 15,725,241

Financial assets at FVTPL

5,369,744 1,508 628,450 217,748 139,015 666,414 7,022,879

Financial assets at FVTOCI

25,613,240 820,168 1,179,589 11,749 22,641 1,403,405 29,050,792

Derivative assets (Designated for hedging)

- - 129,562 - - - 129,562

Off-balance accounts

122,951,908 917,101 413,345 39,069 42,853 2,261,278 126,625,554

Total

494,751,510 6,564,205 5,759,730 486,356 879,052 15,263,600 523,704,453
(*)

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

December 31, 2020
Korea China USA UK Japan Others (*) Total

Loans and other financial assets at amortized cost

296,186,751 4,356,747 3,988,304 1,990,490 1,404,670 12,179,116 320,106,078

Securities at amortized cost

16,749,531 - 110,597 - - 160,711 17,020,839

Financial assets at FVTPL

6,954,630 13,403 1,083,096 493,285 480,760 1,488,752 10,513,926

Financial assets at FVTOCI

25,966,333 608,893 1,092,636 5 5,460 1,274,814 28,948,141

Derivative assets (Designated for hedging)

- - 165,458 3,740 - 5,622 174,820

Off-balance accounts

119,699,069 1,393,734 399,678 38,389 41,378 2,325,888 123,898,136

Total

465,556,314 6,372,777 6,839,769 2,525,909 1,932,268 17,434,903 500,661,940
(*)

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

b)

Credit risk exposure by industries

①

The following tables analyze credit risk exposure by industries, which are service, manufacturing, finance and insurance, construction, individuals and others in accordance with the Korea Standard Industrial Classification Code as of June 30, 2021 and December 31, 2020 (Unit: Korean Won in millions):

June 30, 2021
Service Manufacturing Finance and
insurance 		Construction Individuals Others Total

Loans and other financial assets at amortized cost

62,980,002 36,761,821 45,463,487 4,412,769 179,199,921 16,332,425 345,150,425

Securities at amortized cost

421,425 2,700 7,707,605 261,702 - 7,331,809 15,725,241

Financial assets at FVTPL

126,142 118,741 5,535,461 16,617 6,069 1,219,849 7,022,879

Financial assets at FVTOCI

356,681 255,779 20,654,610 154,118 - 7,629,604 29,050,792

Derivative assets (Designated for hedging)

- - 129,562 - - - 129,562

Off-balance accounts

17,636,178 20,621,091 10,945,462 4,010,107 66,958,956 6,453,760 126,625,554

Total

81,520,428 57,760,132 90,436,187 8,855,313 246,164,946 38,967,447 523,704,453
December 31, 2020
Service Manufacturing Finance and
insurance 		Construction Individuals Others Total

Loans and other financial assets at amortized cost

56,627,927 35,933,953 35,450,774 3,493,000 172,116,780 16,483,644 320,106,078

Securities at amortized cost

492,172 6,691 8,926,909 302,225 - 7,292,842 17,020,839

Financial assets at FVTPL

301,296 234,712 8,520,127 32,240 14,619 1,410,932 10,513,926

Financial assets at FVTOCI

475,881 207,903 23,017,149 142,396 - 5,104,812 28,948,141

Derivative assets (Designated for hedging)

- - 174,820 - - - 174,820

Off-balance accounts

18,828,656 21,460,581 12,086,935 4,060,358 62,477,117 4,984,489 123,898,136

Total

76,725,932 57,843,840 88,176,714 8,030,219 234,608,516 35,276,719 500,661,940

- 30 -

②

The detailed industries of financial assets and corporate loans that might get affected by the spread of COVID-19 as of June 30, 2021 and December 31, 2020 are as follows and the industries that can be affected may change by future economic conditions (Unit: Korean Won in millions):

< Woori Bank >

June 30, 2021
Loans and other
financial assets at
amortized cost 		Financial assets
at FVTPL 		Financial assets
at FVTOCI

Service business

Distribution business
General retail
business
546,708 107 -

General wholesale
business
718,486 207 -
Sub-total 1,265,194 314 -

Accommodation business

1,777,814 3,733 14,481

Travel business

55,915 - -

Art/sports, leisure service

643,450 4,711 -

Food business

1,180,054 488 -

Transportation business

439,802 866 9,088

Others

1,025,126 874 -

Sub-total

6,387,355 10,986 23,569

Manufacturing

Textile 2,421,918 1,636 10,104

Metal

181,613 99 -

Non-metal

147,335 126 -

Chemical

888,883 3,254 -

Electronics

98,094 - -

Others

194,558 - -

Sub-total

3,932,401 5,115 10,104

Total

10,319,756 16,101 33,673
June 30, 2021
Off-balance accounts Total

Service business

Distribution business
General retail
business
283,262 830,077

General wholesale
business
251,697 970,390

Sub-total

534,959 1,800,467

Accommodation business

187,491 1,983,519

Travel business

14,495 70,410

Art/sports, leisure service

67,745 715,906

Food business

155,116 1,335,658

Transportation business

174,635 624,391

Others

138,743 1,164,743

Sub-total

1,273,184 7,695,094

Manufacturing

Textile 1,006,559 3,440,217

Metal

34,275 215,987

Non-metal

48,747 196,208

Chemical

887,763 1,779,900

Electronics

37,802 135,896

Others

96,818 291,376

Sub-total

2,111,964 6,059,584

Total

3,385,148 13,754,678

- 31 -

December 31, 2020
Loans and other
financial assets at
amortized cost 		Financial assets
at FVTPL 		Financial assets
at FVTOCI

Service business

Distribution business
General retail
business
1,070,789 11,944 5,461

General wholesale
business
1,407,563 3,573 -
Sub-total 2,478,352 15,517 5,461

Accommodation business

1,525,157 9,305 5,471

Travel business

59,858 - -

Art/sports, leisure service

1,467,643 17,739 -

Food business

1,078,832 2,515 -

Transportation business

395,873 461 8,752

Education business

367,701 489 -

Others

1,286,578 2,691 -

Sub-total

8,659,994 48,717 19,684

Manufacturing

Textile 2,281,344 6,608 6,559

Metal

1,390,290 47,903 -

Non-metal

698,478 8,357 -

Chemical

1,819,207 19,161 -

Transportation

3,268,095 2,060 -

Electronics

1,424,297 19,280 -

Cosmetics

323,231 217 -

Others

368,123 277 -

Sub-total

11,573,065 103,863 6,559

Total

20,233,059 152,580 26,243
December 31, 2020
Off-balance accounts Total

Service business

Distribution business
General retail
business
897,101 1,985,295

General wholesale
business
483,360 1,894,496

Sub-total

1,380,461 3,879,791

Accommodation business

152,059 1,691,992

Travel business

21,350 81,208

Art/sports, leisure service

114,388 1,599,770

Food business

135,680 1,217,027

Transportation business

193,578 598,664

Education business

48,064 416,254

Others

318,641 1,607,910

Sub-total

2,364,221 11,092,616

Manufacturing

Textile 1,064,005 3,358,516

Metal

1,581,887 3,020,080

Non-metal

377,506 1,084,341

Chemical

3,233,405 5,071,773

Transportation

2,183,616 5,453,771

Electronics

1,789,605 3,233,182

Cosmetics

54,518 377,966

Others

1,483,551 1,851,951

Sub-total

11,768,093 23,451,580

Total

14,132,314 34,544,196

- 32 -

< Woori Card Co., Ltd. >

June 30, 2021
Loans and other
financial assets at
amortized cost 		Financial assets
at FVTPL 		Financial assets
at FVTOCI 		Off-balance
accounts 		Total

Accommodation business

2,401 - - 11,885 14,286

Travel business

2,143 - - 23,108 25,251

Aviation

401 - - 4,207 4,608

Cosmetics industry

2,889 - - 12,168 15,057

Distribution business

6,986 - - 39,566 46,552

Food industry

29,960 - - 138,292 168,252

Art/sports, leisure service

6,991 - - 47,150 54,141

Total

51,771 - - 276,376 328,147
December 31, 2020
Loans and other
financial assets at
amortized cost 		Financial assets
at FVTPL 		Financial assets
at FVTOCI 		Off-balance
accounts 		Total

Accommodation business

4,959 - - 12,315 17,274

Travel business

2,175 - - 25,367 27,542

Aviation

479 - - 4,179 4,658

Cosmetics industry

2,462 - - 13,376 15,838

Distribution business

8,050 - - 44,354 52,404

Food industry

33,084 - - 163,711 196,795

Art/sports, leisure service

6,156 - - 51,962 58,118

Total

57,365 - - 315,264 372,629

- 33 -

June 30, 2021
Loans and other
financial assets at
amortized cost 		Financial assets
at FVTPL 		Financial assets
at FVTOCI

Service business

Distribution business
General retail
business
103,009 - -

General wholesale
business
388,532 - -
Sub-total 491,541 - -

Accommodation business

8,213 - -

Travel business

67 - -

Art/sports, leisure service

9,434 - -

Food business

25,926 - -

Transportation business

63,857 - -

Education business

2,317 - -

Others

46,756 - -

Sub-total

648,111 - -

Manufacturing

Textile 85 - -

Metal

10,333 - -

Non-metal

7,748 - -

Chemical

2,777 - -

Transportation

1,533 - -

Electronics

1,122 - -

Others

192,100 - -

Sub-total

215,698 - -

Total COVID-19 vulnerable business

863,809 - -

Other business

Others 5,902,636 20,100 -

Total

6,766,445 20,100 -
June 30, 2021
Off-balance accounts Total

Service business

Distribution business
General retail
business
- 103,009

General wholesale
business
- 388,532

Sub-total

- 491,541

Accommodation business

- 8,213

Travel business

- 67

Art/sports, leisure service

- 9,434

Food business

- 25,926

Transportation business

- 63,857

Education business

- 2,317

Others

800 47,556

Sub-total

800 648,911

Manufacturing

Textile - 85

Metal

- 10,333

Non-metal

- 7,748

Chemical

- 2,777

Transportation

- 1,533

Electronics

- 1,122

Others

2,766 194,866

Sub-total

2,766 218,464

Total COVID-19 vulnerable business

3,566 867,375

Other business

Others 931,395 6,854,131

Total

934,961 7,721,506

- 34 -

December 31, 2020
Loans and other
financial assets at
amortized cost 		Financial assets
at FVTPL 		Financial assets
at FVTOCI

Service business

Distribution business
General retail
business
8,978 - -

General wholesale
business
57,587 - -
Sub-total 66,565 - -

Accommodation business

6,292 - -

Travel business

1,293 - -

Art/sports, leisure service

615 - -

Food business

21,774 - -

Transportation business

28,270 - -

Education business

1,132 - -

Others

365,860 27,364 -

Sub-total

491,801 27,364 -

Manufacturing

Textile 29,415 - -

Metal

17,963 - -

Non-metal

4,780 - -

Chemical

2,501 - -

Transportation

52,514 - -

Electronics

12,665 - -

Others

5,335 - -

Sub-total

125,173 - -

Total COVID-19 vulnerable business

616,974 27,364 -

Other business

Others 6,202,754 225,078 -

Total

6,819,728 252,442 -
December 31, 2020
Off-balance accounts Total

Service business

Distribution business
General retail
business
- 8,978

General wholesale
business
- 57,587

Sub-total

- 66,565

Accommodation business

- 6,292

Travel business

- 1,293

Art/sports, leisure service

- 615

Food business

- 21,774

Transportation business

- 28,270

Education business

- 1,132

Others

38,681 431,905

Sub-total

38,681 557,846

Manufacturing

Textile - 29,415

Metal

3,365 21,328

Non-metal

- 4,780

Chemical

- 2,501

Transportation

- 52,514

Electronics

- 12,665

Others

- 5,335

Sub-total

3,365 128,538

Total COVID-19 vulnerable business

42,046 686,384

Other business

Others 333,766 6,761,598

Total

375,812 7,447,982

- 35 -

< Woori Investment Bank Co., Ltd. >

June 30, 2021
Loans and other
financial assets at
amortized cost 		Financial assets
at FVTPL 		Financial assets
at FVTOCI 		Off-balance
accounts 		Total

Accommodation business

43,498 - - - 43,498

Distribution business

25,156 - - - 25,156

Art/sports, leisure service

21,349 - - - 21,349

Total

90,003 - - - 90,003
December 31, 2020
Loans and other
financial assets at
amortized cost 		Financial assets
at FVTPL 		Financial assets
at FVTOCI 		Off-balance
accounts 		Total

Accommodation business

44,900 - - - 44,900

Distribution business

15,716 20,000 - - 35,716

Art/sports, leisure service

28,000 - - - 28,000

Total

88,616 20,000 - - 108,616

- 36 -

3)

Credit risk exposure

a)

Financial assets

The maximum exposure to credit risk by asset quality, except for financial assets at FVTPL and derivative asset (Designated for hedging) as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):

June 30, 2021
Stage 1 Stage 2 Stage 3 Total Loss
allowance 		Total, net
Above
appropriate
credit rating
(*1) 		Less than a
limited credit
rating
(*2) 		Above
appropriate
credit rating
(*1) 		Less than a
limited
credit rating
(*2)

Loans and other financial assets at amortized cost

302,137,318 20,725,851 11,776,942 10,941,452 1,534,040 347,115,603 (1,965,178 ) 345,150,425

Korean treasury and government agencies

20,641,949 2,131 - - - 20,644,080 (5,032 ) 20,639,048

Banks

18,509,797 81,109 59,884 - 36,223 18,687,013 (12,962 ) 18,674,051

Corporates

102,330,464 14,241,769 2,100,146 4,412,048 755,720 123,840,147 (1,163,131 ) 122,677,016

General business

66,323,106 7,027,239 1,550,692 3,093,642 580,577 78,575,256 (871,875 ) 77,703,381

Small- and medium-sized enterprise

30,234,554 6,597,387 549,454 1,278,247 157,763 38,817,405 (257,336 ) 38,560,069

Project financing and others

5,772,804 617,143 - 40,159 17,380 6,447,486 (33,920 ) 6,413,566

Consumers

160,655,108 6,400,842 9,616,912 6,529,404 742,097 183,944,363 (784,053 ) 183,160,310

Securities at amortized cost

15,729,515 - - - - 15,729,515 (4,274 ) 15,725,241

Financial assets at FVTOCI (*3)

28,892,167 158,625 - - - 29,050,792 (10,192 ) 29,050,792

Total

346,759,000 20,884,476 11,776,942 10,941,452 1,534,040 391,895,910 (1,979,644 ) 389,926,458
June 30, 2021
Collateral value
Stage 1 Stage 2 Stage 3 Total

Loans and other financial assets at amortized cost

197,236,246 17,471,180 690,363 215,397,789

Korean treasury and government agencies

19,195 - - 19,195

Banks

1,230,122 - - 1,230,122

Corporates

69,593,805 4,653,583 398,205 74,645,593

General business

38,074,043 3,192,489 314,136 41,580,668

Small- and medium-sized enterprise

28,644,410 1,461,094 83,854 30,189,358

Project financing and others

2,875,352 - 215 2,875,567

Consumers

126,393,124 12,817,597 292,158 139,502,879

Securities at amortized cost

- - - -

Financial assets at FVTOCI (*3)

- - - -

Total

197,236,246 17,471,180 690,363 215,397,789
(*1)

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

(*2)

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

(*3)

Financial assets at FVTOCI has been disclosed as the amount before deducting allowance for credit losses because allowance for credit losses does not reduce the carrying amount.

- 37 -

December 31, 2020
Stage 1 Stage 2 Stage 3 Total Loss
allowance 		Total, net
Above
appropriate
credit rating
(*1) 		Less than a
limited credit
rating
(*2) 		Above
appropriate
credit rating
(*1) 		Less than a
limited
credit rating
(*2)

Loans and other financial assets at amortized cost

278,729,012 21,249,885 10,356,251 10,143,839 1,623,276 322,102,263 (1,996,185 ) 320,106,078

Korean treasury and government agencies

9,674,891 1,063 52,279 - - 9,728,233 (2,514 ) 9,725,719

Banks

19,301,570 105,890 75,876 - 25,598 19,508,934 (15,745 ) 19,493,189

Corporates

93,889,922 14,873,376 1,890,564 3,860,389 839,234 115,353,485 (1,221,491 ) 114,131,994

General business

61,082,336 9,013,955 1,349,053 2,585,868 576,078 74,607,290 (869,744 ) 73,737,546

Small- and medium-sized enterprise

27,504,992 5,415,312 538,909 1,207,706 227,003 34,893,922 (304,077 ) 34,589,845

Project financing and others

5,302,594 444,109 2,602 66,815 36,153 5,852,273 (47,670 ) 5,804,603

Consumers

155,862,629 6,269,556 8,337,532 6,283,450 758,444 177,511,611 (756,435 ) 176,755,176

Securities at amortized cost

17,025,405 - - - - 17,025,405 (4,566 ) 17,020,839

Financial assets at FVTOCI (*3)

28,789,281 158,860 - - - 28,948,141 (9,631 ) 28,948,141

Total

324,543,698 21,408,745 10,356,251 10,143,839 1,623,276 368,075,809 (2,010,382 ) 366,075,058
December 31, 2020
Collateral value
Stage 1 Stage 2 Stage 3 Total

Loans and other financial assets at amortized cost

187,731,443 15,677,871 696,709 204,106,023

Korean treasury and government agencies

19,280 - - 19,280

Banks

1,003,971 - - 1,003,971

Corporates

62,817,305 3,963,101 400,340 67,180,746

General business

35,578,470 2,670,480 271,815 38,520,765

Small- and medium-sized enterprise

25,404,002 1,290,941 118,265 26,813,208

Project financing and others

1,834,833 1,680 10,260 1,846,773

Consumers

123,890,887 11,714,770 296,369 135,902,026

Securities at amortized cost

- - - -

Financial assets at FVTOCI (*3)

- - - -

Total

187,731,443 15,677,871 696,709 204,106,023
(*1)

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

(*2)

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

(*3)

Financial assets at FVTOCI has been disclosed as the amount before deducting allowance for credit losses because allowance for credit losses does not reduce the carrying amount.

- 38 -

b)

Guarantees and commitments

The credit quality of the guarantees and loan commitments as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021

Financial assets

Stage 1 Stage 2 Stage 3 Total
Above
appropriate
credit rating
(*1) 		Less than a
limited
credit rating
(*2) 		Above
appropriate
credit rating
(*1) 		Less than a
limited
credit rating
(*2)

Off-balance accounts

Guarantees

11,582,985 498,333 24,308 171,575 77,549 12,354,750

Loan Commitments

108,309,688 2,766,775 2,156,009 1,035,607 2,725 114,270,804

Total

119,892,673 3,265,108 2,180,317 1,207,182 80,274 126,625,554
(*1)

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

(*2)

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

December 31, 2020

Financial assets

Stage 1 Stage 2 Stage 3 Total
Above
appropriate
credit rating
(*1) 		Less than a
limited
credit rating
(*2) 		Above
appropriate
credit rating
(*1) 		Less than a
limited
credit rating
(*2)

Off-balance accounts

Guarantees

10,152,900 1,382,592 11,504 191,962 70,498 11,809,456

Loan Commitments

105,108,967 4,045,595 1,951,649 977,185 5,284 112,088,680

Total

115,261,867 5,428,187 1,963,153 1,169,147 75,782 123,898,136
(*1)

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

(*2)

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

4)

Collateral and other credit enhancements

For the six-month period ended June 30, 2021 and for the year ended December 31, 2020, there have been no significant changes in the value of collateral or other credit enhancements held by the Group and there have been no significant changes in collateral or other credit enhancements due to changes in the collateral policy of the Group.

- 39 -

(2)

Market risk

Market risk is the possible risk of loss arising from trading position and non-trading position as a result of the volatility of market factors such as interest rates, stock prices and foreign exchange rates.

1)

Market risk management

Market risk management refers to the process of making and implementing decisions for the avoidance, acceptance or mitigation of risks by identifying the underlying source of the risks and measuring its level, and evaluating the appropriateness of the level of accepted market risks.

a)

Trading activities

The Group uses the standard method and the internally developed model (the Bank) in measuring market risk for trading positions, and allocates market risk capital through the Risk Management Committee. Risk management departments of the Group and its subsidiaries manage limits in detail including those on risk and loss with their management result regularly reported to the Risk Management Committee.

Woori Bank, a subsidiary of the Group, uses the internal model approved by the Financial Supervisory Service to measure the VaR using the Historical Simulation Method based on a 99% confidence level and a 10-day retention period, and calculates the required capital risk for calculating the BIS ratio. For internal management purposes, limit management is performed on a daily basis measuring VaR based on a 99% confidence and 1-day retention period. In addition, Woori Bank perform a daily verification that compares VaR measurement and profit and loss to verify the suitability of the model.

The minimum, maximum and average VaR of the Bank for the six-month period June 30, 2021 and for the year ended December 31, 2020, and the VaR of the Bank as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30,
2021 		For the six-month period ended
June 30, 2021 		December 31,
2020 		For the year ended
December 31, 2020

Risk factor

Average Maximum Minimum Average Maximum Minimum

Interest rate

4,702 5,277 14,017 2,405 6,815 7,959 15,065 2,427

Stock price

3,955 3,350 6,423 1,797 2,283 5,783 14,394 1,982

Foreign currencies

5,412 7,799 13,144 4,767 11,160 8,814 11,233 4,613

Diversification

(7,006 ) (8,565 ) (19,753 ) (3,835 ) (11,087 ) (11,175 ) (18,796 ) (3,452 )

Total VaR(*)

7,063 7,861 13,831 5,134 9,171 11,381 21,896 5,570
(*)

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

- 40 -

b)

Non-trading activities

From the end of 2019 for the Bank and the beginning of 2021 for non-banking subsidiaries, the Bank and its subsidiaries manage and measure interest risk for non-trading activities through DNII(Change in Net Interest Income) and DEVE(Change in Economic Value of Equity) in accordance with IRRBB(Interest Rate Risk in the Banking Book).

DNII represents a change in net interest income that may occur over a certain period (e.g. one year) due to changes in net interest income, and DEVE indicates the economic value changes in equity capital that could be caused by changes in interest rates affecting the present value of asset, liabilities, and others.

DEVE and DNII calculated on interest risk in banking book(IRRBB) basis for assets and liabilities by subsidiary as of the end of June 30, 2021 and December 31, 2020 are as follows(Unit: Korean Won in millions):

June 30, 2021 December 31, 2020 (*3)
DEVE
(*1) 		DNII
(*2) 		DEVE
(*1) 		DNII
(*2)

Woori Bank

865,853 51,578 634,596 66,138

Woori Card Co., Ltd.

119,363 31,024 - -

Woori Financial Capital Co., Ltd.

53,691 2,433 - -

Woori Investment Bank Co., Ltd.

7,442 18,171 - -

Woori Asset Trust Co., Ltd.

1,642 903 - -

Woori Asset Management Corp.

1,486 265 - -

Woori Savings Bank

13,047 86 - -

Woori Private Equity Asset Management Co., Ltd.

1,367 47 - -

Woori Global Asset Management Co., Ltd.

353 68 - -
(*1)

DEVE: change in Economic Value of Equity

(*2)

DNII: change in Net Interest Income

(*3)

As of December 31, 2020, for the remaining subsidiaries except the bank, consolidated trusts, and consolidated subsidiaries of the bank, EVE and NII were not calculated.

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

December 31, 2020
EaR (*1) VaR (*2)

Woori Card Co., Ltd.

106,645 157,085

Woori Financial Capital Co., Ltd.

3,701 12,550

Woori Investment Bank Co., Ltd.

1,479 5,005

Woori Asset Trust Co., Ltd.

3,211 398

Woori Asset Management Corp.

64 493

Woori Private Equity Asset Management Co., Ltd.

193 37

Woori Global Asset Management Co., Ltd.

119 318
(*1)

EaR (Earning at Risk): Change of maximum expected income and expense

(*2)

VaR (Value at Risk): Maximum expected losses

- 41 -

The Group estimates and manages risks related to changes in interest rate due to the difference in the maturities of interest-bearing assets and liabilities and discrepancies in the terms of interest rates. Cash flows (both principal and interest), interest bearing assets and liabilities, presented by each re-pricing date, are as follows (Unit: Korean Won in millions):

June 30, 2021
Within 3
months 		4 to 6
months 		7 to 9
months 		10 to 12
months 		1 to 5
years 		Over 5
years 		Total

Asset:

Loans and other financial assets at amortized cost

185,900,839 50,720,981 16,577,249 16,808,522 64,967,665 4,504,350 339,479,606

Financial assets at FVTPL

743,809 85,804 53,502 53,270 339,354 16,857 1,292,596

Financial assets at FVTOCI

4,166,280 1,972,127 2,833,413 4,080,867 15,978,972 551,087 29,582,746

Securities at amortized cost

1,219,155 1,864,315 1,120,867 952,209 9,974,120 1,262,559 16,393,225

Total

192,030,083 54,643,227 20,585,031 21,894,868 91,260,111 6,334,853 386,748,173

Liability:

Deposits due to customers

132,225,484 53,393,496 38,059,940 19,876,450 58,716,564 59,095 302,331,029

Borrowings

11,797,382 3,164,618 1,032,689 1,498,079 4,710,877 463,998 22,667,643

Debentures

4,317,821 3,343,191 2,739,535 3,306,657 25,574,575 3,303,981 42,585,760

Total

148,340,687 59,901,305 41,832,164 24,681,186 89,002,016 3,827,074 367,584,432
December 31, 2020
Within 3
months 		4 to 6
months 		7 to 9
months 		10 to 12
months 		1 to 5
years 		Over 5
years 		Total

Asset:

Loans and other financial assets at amortized cost

177,214,415 54,035,826 12,410,513 11,140,520 64,799,854 5,170,572 324,771,700

Financial assets at FVTPL

609,542 263,510 91,791 94,879 150,148 13,239 1,223,109

Financial assets at FVTOCI

4,344,718 3,339,086 3,751,882 2,915,238 14,648,033 473,124 29,472,081

Securities at amortized cost

1,372,094 1,471,309 933,715 1,869,352 11,080,632 1,018,002 17,745,104

Total

183,540,769 59,109,731 17,187,901 16,019,989 90,678,667 6,674,937 373,211,994

Liability:

Deposits due to customers

127,557,303 46,471,099 35,455,403 29,354,652 52,395,811 50,655 291,284,923

Borrowings

11,223,338 2,832,846 1,126,728 949,892 3,828,384 452,495 20,413,683

Debentures

3,246,233 3,396,427 3,929,346 3,495,915 21,899,788 3,257,026 39,224,735

Total

142,026,874 52,700,372 40,511,477 33,800,459 78,123,983 3,760,176 350,923,341
2)

Currency risk

Currency risk arises from the financial instruments denominated in foreign currencies other than the functional currency. Therefore, no currency risk arises from non-monetary items or financial instruments denominated in the functional currency.

- 42 -

Financial instruments in foreign currencies exposed to currency risk as of June 30, 2021 and December 31, 2020 are as follows (Unit: USD in millions, JPY in millions, CNY in millions, EUR in millions, and Korean Won in millions):

June 30, 2021
USD JPY CNY EUR Others Total
Foreign
currency 		Korean Won
equivalent 		Foreign
currency 		Korean
Won
equivalent 		Foreign
currency 		Korean
Won
equivalent 		Foreign
currency 		Korean
Won
equivalent 		Korean
Won
equivalent 		Korean Won
equivalent

Asset

Cash and cash equivalents 5,544 6,264,205 14,286 146,557 2,607 455,813 113 151,698 581,084 7,599,357
Loans and other financial assets at amortized cost 23,994 27,113,097 153,911 1,578,243 23,349 4,082,294 1,943 2,612,078 5,769,496 41,155,208
Financial assets at FVTPL 370 418,617 10,817 203,877 14 2,451 369 499,227 32,939 1,157,111
Financial assets at FVTOCI 2,745 3,101,436 - - 4,658 814,484 40 54,024 630,325 4,600,269
Securities at amortized cost 244 275,919 - - 848 148,306 21 27,945 123,937 576,107

Total

32,897 37,173,274 179,014 1,928,677 31,476 5,503,348 2,486 3,344,972 7,137,781 55,088,052

Liability

Financial liabilities at FVTPL 352 397,497 23,954 288,145 - - 232 312,517 154,762 1,152,921
Deposits due to customers 18,573 20,988,030 223,103 2,280,380 22,724 3,973,125 1,374 1,846,816 4,089,854 33,178,205
Borrowings 5,061 5,719,103 10,776 158,661 1,305 228,173 446 600,023 1,577,613 8,283,573
Debentures 4,040 4,564,641 - - - - - - 338,742 4,903,383
Other financial liabilities 2,378 2,686,674 7,463 81,094 5,877 1,027,595 202 272,021 429,277 4,496,661

Total

30,404 34,355,945 265,296 2,808,280 29,906 5,228,893 2,254 3,031,377 6,590,248 52,014,743

Off-balance accounts

8,289 9,366,070 30,350 310,213 2,316 404,936 513 689,299 725,560 11,496,078
December 31, 2020
USD JPY CNY EUR Others Total
Foreign
currency 		Korean Won
equivalent 		Foreign
currency 		Korean
Won
equivalent 		Foreign
currency 		Korean
Won
equivalent 		Foreign
currency 		Korean
Won
equivalent 		Korean
Won
equivalent 		Korean Won
equivalent

Asset

Cash and cash equivalents 5,584 6,074,879 22,832 240,710 4,580 764,686 115 154,154 501,900 7,736,329
Loans and other financial assets at amortized cost 21,687 23,595,957 172,782 1,821,554 24,230 4,045,435 2,001 2,678,382 4,857,438 36,998,766
Financial assets at FVTPL 280 304,146 18,855 198,781 73 11,989 248 332,182 88,745 935,843
Financial assets at FVTOCI 2,741 2,981,832 - - 2,601 434,258 37 49,789 565,893 4,031,772
Securities at amortized cost 319 347,570 - - - - 34 45,197 115,534 508,301

Total

30,611 33,304,384 214,469 2,261,045 31,484 5,256,368 2,435 3,259,704 6,129,510 50,211,011

Liability

Financial liabilities at FVTPL 426 463,678 14,493 152,792 - - 158 211,525 115,429 943,424
Deposits due to customers 16,664 18,130,448 220,153 2,320,983 26,733 4,463,300 1,532 2,050,400 3,443,631 30,408,762
Borrowings 5,657 6,154,464 48,446 510,750 - - 590 789,955 697,234 8,152,403
Debentures 3,973 4,322,800 - - - - - - 444,711 4,767,511
Other financial liabilities 2,381 2,590,147 6,705 70,690 1,853 309,319 64 85,553 193,128 3,248,837

Total

29,101 31,661,537 289,797 3,055,215 28,586 4,772,619 2,344 3,137,433 4,894,133 47,520,937

Off-balance accounts

7,441 8,095,297 24,992 263,478 3,007 502,106 533 712,846 556,988 10,130,715

- 43 -

(3)

Liquidity risk

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

1)

Liquidity risk management

Liquidity risk management is to prevent potential cash shortages as a result of mismatching the use of funds (assets) and sources of funds (liabilities) or unexpected cash outflows. The financial liabilities that are relevant to liquidity risk are incorporated within the scope of risk management. Derivatives instruments are excluded from those financial liabilities as they reflect expected cash flows for a pre-determined period.

Assets and liabilities are grouped by account under Asset Liability Management ('ALM') in accordance with the characteristics of the account. The Group manages liquidity risk by identifying the maturity gap and such gap ratio through various cash flows analysis (i.e. based on remaining maturity and contract period, etc.), while maintaining the gap ratio at or below the target limit.

2)

Maturity analysis of non-derivative financial liabilities

a) Cash flows of principals and interests by remaining contractual maturities of non-derivative financial liabilities as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021
Within 3
months 		4 to 6
months 		7 to 9
months 		10 to 12
months 		1 to 5
years 		Over 5
years 		Total

Financial liabilities at FVTPL

80,452 21,069 21,927 147,028 - - 270,476

Deposits due to customers

205,113,826 39,145,113 25,694,469 23,401,034 9,267,620 1,727,436 304,349,498

Borrowings

9,742,709 3,703,637 1,731,057 2,158,344 4,861,940 475,298 22,672,985

Debentures

4,317,821 3,343,191 2,739,535 3,306,657 25,574,575 3,303,981 42,585,760

Lease liabilities

45,250 39,167 30,682 41,017 150,566 37,238 343,920

Other financial liabilities

15,726,252 64,108 14,760 31,107 615,457 1,510,559 17,962,243

Total

235,026,310 46,316,285 30,232,430 29,085,187 40,470,158 7,054,512 388,184,882
December 31, 2020
Within 3
months 		4 to 6
months 		7 to 9
months 		10 to 12
months 		1 to 5
years 		Over 5
years 		Total

Financial liabilities at FVTPL

64,183 135,232 42,418 112,102 - - 353,935

Deposits due to customers

191,660,253 34,349,298 25,213,410 31,144,452 9,230,904 1,793,143 293,391,460

Borrowings

10,159,819 2,524,572 1,714,490 1,866,810 4,177,634 463,376 20,906,701

Debentures

3,246,233 3,396,427 3,929,346 3,495,915 21,899,788 3,257,228 39,224,937

Lease liabilities

53,429 44,551 40,809 34,761 201,113 34,780 409,443

Other financial liabilities

8,121,978 70,277 10,294 10,897 451,096 2,142,772 10,807,314

Total

213,305,895 40,520,357 30,950,767 36,664,937 35,960,535 7,691,299 365,093,790

- 44 -

b) Cash flows of principals and interests by expected maturities of non-derivative financial liabilities as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021
Within 3
months 		4 to 6
months 		7 to 9
months 		10 to 12
months 		1 to 5
years 		Over 5
years 		Total

Financial liabilities at FVTPL

80,452 21,069 21,927 147,028 - - 270,476

Deposits due to customers

212,294,262 40,187,821 24,220,703 19,252,790 7,886,088 109,812 303,951,476

Borrowings

9,742,709 3,703,637 1,731,057 2,158,344 4,861,940 475,298 22,672,985

Debentures

4,317,821 3,343,191 2,739,535 3,306,657 25,574,575 3,303,981 42,585,760

Lease liabilities

45,391 39,480 32,078 41,768 155,891 38,947 353,555

Other financial liabilities

15,721,019 63,646 14,951 30,385 622,564 1,510,142 17,962,707

Total

242,201,654 47,358,844 28,760,251 24,936,972 39,101,058 5,438,180 387,796,959
December 31, 2020
Within 3
months 		4 to 6
months 		7 to 9
months 		10 to 12
months 		1 to 5
years 		Over 5
years 		Total

Financial liabilities at FVTPL

68,909 131,496 41,428 112,102 - - 353,935

Deposits due to customers

199,931,480 35,912,096 23,924,403 25,477,917 7,582,278 105,413 292,933,587

Borrowings

10,159,819 2,524,572 1,714,490 1,866,810 4,177,634 463,376 20,906,701

Debentures

3,246,233 3,396,427 3,929,346 3,495,915 21,899,788 3,257,228 39,224,937

Lease liabilities

53,429 44,894 40,949 35,074 208,125 36,950 419,421

Other financial liabilities

8,121,978 70,277 10,294 10,897 451,096 2,142,772 10,807,314

Total

221,581,848 42,079,762 29,660,910 30,998,715 34,318,921 6,005,739 364,645,895
3)

Maturity analysis of derivative financial liabilities

Derivatives held for trading purpose are not managed in accordance with their contractual maturity, since the Group holds such financial instruments with the purpose of disposing or redemption before their maturity. As such, those derivatives are incorporated as 'within 3 months' in the table below. Derivatives designated for hedging purpose are estimated by offsetting cash inflows and cash outflows.

The cash flow by the maturity of derivative financial liabilities as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):

Remaining maturity
Within 3
months 		4 to 6
months 		7 to 9
months 		10 to 12
months 		1 to 5
years 		Over 5
years 		Total

June 30, 2021

Cash flow risk hedge 723 595 (94 ) 2,742 30,554 (16 ) 34,504
Fair value risk hedge (1,446 ) 347 (1,406 ) 418 12,548 - 10,461
Trading purpose 3,657,360 - - - - - 3,657,360

December 31, 2020

Cash flow risk hedge 2,655 6,004 515 239 55,744 - 65,157
Fair value risk hedge 255 (302 ) 233 (287 ) 126 - 25
Trading purpose 6,460,472 - - - - - 6,460,472
4)

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

A financial guarantee represents an irrevocable undertaking that the Group should meet a customer's obligations to third parties if the customer fails to do so. The loan commitment represents the limit if the Group has promised a credit to the customer. Commitments to lend include commercial standby facilities and credit lines, liquidity facilities to commercial paper conduits and utilized overdraft facilities. The maximum limit to be paid by the Group in accordance with guarantees and loan commitment only applies to principal amounts. There are contractual maturities for financial guarantees, such as guarantees for debentures issued or loans, unused loan commitments, and other guarantees, however, under the terms of the guarantees and unused loan commitments, funds should be paid upon demand from the counterparty. Details of off-balance accounts are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Guarantees

12,354,750 11,809,456

Loan commitments

114,270,804 112,088,680

Other commitments

3,788,926 4,933,086

- 45 -

(4)

Operational risk

The Group defines the operational risk that could cause a negative effect on capital resulting from inadequate internal process, labor work and systematic problem or external factors.

1)

Operational risk management

The Group has established and operated an operating risk management system to strengthen external competitiveness, reduce risk capital volume, enhance operational risk management capacity and prevent accidents through compliance with Basel II, and has obtained approval from the Financial Supervisory Service for 'Advanced Measurement Approaches'(AMA) based on self-compliance verification and independent third-party inspection results.

2)

Operational risk measurement

The Group is applying the basic indicator method for the purpose of calculating the regulatory capital of operation risk, and the Bank is applying the advanced measurement method. The Bank applies AMA using internal and external loss data, business environment and internal control factors, and scenario analysis.

- 46 -

5.

OPERATING SEGMENTS

In evaluating the results of the Group and allocating resources, the Group's Chief Operation Decision Maker ('CODM') utilizes the information per type of customers. This financial information of the segments is regularly reviewed by the CODM to make decisions about resources to be allocated to each segment and evaluate its performance.

(1)

Segment by type of organization

The Group's reporting segments consist of banking, credit card, capital, investment banking and other sectors, and the composition of such reporting segments was divided based on internal report data periodically reviewed by the management to evaluate the performance of the segment and make decisions on the resources to be distributed.

Operational scope

Banking Loans/deposits, financial services and other relevant services for customers of Woori Bank
Credit card Credit card, cash services, card loans and other relevant services of Woori Card Co., Ltd.
Capital Installments, loans including lease financing and other relevant services of Woori Financial Capital Co., Ltd.
Investment banking Securities operation, sale of financial instruments, project financing and other related services for comprehensive financing of Woori Investment Bank Co., Ltd.
Others Woori Financial Group Inc., Woori Asset Trust Co., Ltd., Woori Asset Management Corp., Ltd., Woori Savings Bank, Woori Credit Information Co., Ltd., Woori Fund Services Inc., Woori Private Equity Asset Management Co., Ltd., Woori Global Asset Management Co., Ltd., Woori FIS Co., Ltd. and Woori Finance Research Institute
(2)

The details of income (expense) by each segment are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Banking (*1) Credit
card 		Capital Investment
banking 		Others (*2) Sub-total Adjustments (*3) Total

Net interest income

2,455,888 289,977 144,326 51,365 12,114 2,953,670 368,949 3,322,619

Non-interest income(expense)

880,871 43,409 41,251 27,751 889,701 1,882,983 (1,161,693 ) 721,290

Impairment losses due to credit loss

(76,945 ) (66,694 ) (31,589 ) 2,566 (3,646 ) (176,308 ) (28,268 ) (204,576 )

General and administrative expense

(1,604,531 ) (102,815 ) (41,224 ) (24,014 ) (216,169 ) (1,988,753 ) 133,260 (1,855,493 )

Net operating income(expense)

1,655,283 163,877 112,764 57,668 682,000 2,671,592 (687,752 ) 1,983,840

Non-operating income(expense)

32,073 (2,701 ) (15,851 ) (271 ) 2,660 15,910 17,998 33,908

Net income(expense) before tax

1,687,356 161,176 96,913 57,397 684,660 2,687,502 (669,754 ) 2,017,748

Tax income(expense)

(403,630 ) (39,741 ) (14,386 ) (13,362 ) (8,811 ) (479,930 ) (567 ) (480,497 )

Net income(loss)

1,283,726 121,435 82,527 44,035 675,849 2,207,572 (670,321 ) 1,537,251

Total assets

393,520,653 12,645,157 8,761,211 4,860,424 24,906,508 444,693,953 (23,423,347 ) 421,270,606

Total liabilities

369,318,152 10,467,730 7,831,718 4,296,271 2,680,272 394,594,143 (1,483,711 ) 393,110,432
(*1)

The banking sector includes banks and their consolidated subsidiaries (such as overseas subsidiaries)

(*2)

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

(*3)

Adjustments were made for the presentation of profit or loss in accordance with the Accounting Standards from the reporting segments in accordance with the Managerial Accounting Standards.

- 47 -

For the six-month period ended June 30, 2020
Banking (*1) Credit card Investment
banking 		Others (*2) Sub-total Adjustments (*3) Total

Net interest income

2,271,005 280,777 35,066 737 2,587,585 353,264 2,940,849

Non-interest income(expense)

721,678 16,935 18,328 864,510 1,621,451 (1,153,465 ) 467,986

Impairment losses due to credit loss

(337,796 ) (94,537 ) (727 ) (211 ) (433,271 ) (13,408 ) (446,679 )

General and administrative expense

(1,615,836 ) (96,684 ) (17,132 ) (189,974 ) (1,919,626 ) 130,068 (1,789,558 )

Net operating income(expense)

1,039,051 106,491 35,535 675,062 1,856,139 (683,541 ) 1,172,598

Non-operating expense

(125,655 ) (2,208 ) (294 ) (97 ) (128,254 ) (10,495 ) (138,749 )

Net income(expense) before tax

913,396 104,283 35,241 674,965 1,727,885 (694,036 ) 1,033,849

Tax income(expense)

(222,569 ) (24,629 ) (3,806 ) (10,278 ) (261,282 ) 1,466 (259,816 )

Net income(loss)

690,827 79,654 31,435 664,687 1,466,603 (692,570 ) 774,033

Total assets (*4)

374,120,064 11,366,596 4,332,474 31,872,690 421,691,824 (22,610,807 ) 399,081,017

Total liabilities (*4)

348,706,682 9,312,986 3,803,594 9,606,742 371,430,004 925,168 372,355,172
(*1)

Banking includes gains and losses from separate Bank and local subsidiaries abroad.

(*2)

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

(*3)

Adjustments were made for the presentation of profit or loss in accordance with the Accounting Standards from the reporting segments in accordance with the Managerial Accounting Standards.

(*4)

Total assets and liabilities are amounts at the end of the previous year.

(3)

Operating profit or loss from external customers for the six-month periods ended June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions):

For the six-month period
ended June 30
2021 2020

Domestic

1,834,105 1,108,347

Foreign

149,735 64,251

Total

1,983,840 1,172,598
(4)

Major non-current assets as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021 (*) December 31, 2020 (*)

Domestic

5,097,802 5,026,161

Foreign

429,930 433,869

Total

5,527,732 5,460,030
(*)

Major non-current assets included investments in joint ventures and associates, investment properties, property, plant and equipment, and intangible assets.

(5)

Information about major customers

The Group does not have any single customer that generates 10% or more of the Group's total revenue for the six-month periods ended June 30, 2021 and 2020.

- 48 -

6.

CASH AND CASH EQUIVALENTS

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

June 30, 2021 December 31, 2020

Cash

1,847,971 1,611,282

Foreign currencies

477,167 514,565

Demand deposits

7,413,388 7,314,353

Fixed deposits

672,820 550,783

Total

10,411,346 9,990,983
7.

FINANCIAL ASSETS AT FVTPL

(1)

Details of financial assets at FVTPL as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Financial assets at fair value through profit or loss measured at fair value

12,264,521 14,762,941
(2)

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

June 30, 2021 December 31, 2020

Deposits:

Gold banking asset

70,150 48,796

Securities:

Debt securities

Korean treasury and government agencies

905,866 1,020,418

Financial institutions

872,516 873,031

Corporates

698,529 761,681

Others

20,013 231,967

Equity securities

458,923 485,793

Capital contributions

987,813 865,685

Beneficiary certificates

3,701,141 2,812,558

Others

93,765 84,979

Sub-total

7,738,566 7,136,112

Loans

431,137 676,291

Derivatives assets

4,024,668 6,901,742

Total

12,264,521 14,762,941

The Group does not have financial assets at fair value through profit or loss designated as upon initial recognition as of June 30, 2021 and December 31, 2020.

- 49 -

8.

FINANCIAL ASSETS AT FVTOCI

(1)

Details of financial assets at FVTOCI as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31,
2020

Debt securities:

Korean treasury and government agencies

4,635,775 2,922,671

Financial institutions

15,467,380 17,996,660

Corporates

3,952,257 3,896,744

Bond denominated in foreign currencies

4,600,217 4,031,721

Securities loaned

395,163 100,345

Sub-total

29,050,792 28,948,141

Equity securities

1,234,099 1,080,788

Total

30,284,891 30,028,929
(2)

Details of equity securities designated as financial assets at FVTOCI as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

Purpose of acquisition

June 30, 2021 December 31, 2020 Remarks

Investment for strategic business partnership purpose

847,132 778,657

Debt-equity swap

386,961 302,090

Others

6 41 Development Trust management purpose, etc.

Total

1,234,099 1,080,788
(3)

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

1)

Allowance for credit losses

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

(9,631 ) - - (9,631 )

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Net provision of allowance for credit losses

(2,097 ) - - (2,097 )

Disposal

1,670 - - 1,670

Others (*)

(134 ) - - (134 )

Ending balance

(10,192 ) - - (10,192 )
(*)

Others consist of foreign currencies translation, etc.

For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

(8,569 ) - - (8,569 )

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Net provision of allowance for credit losses

(782 ) - - (782 )

Disposal

337 - - 337

Others (*)

(170 ) - - (170 )

Ending balance

(9,184 ) - - (9,184 )
(*)

Others consist of foreign currencies translation, etc.

- 50 -

2)

Gross carrying amount

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

28,948,141 - - 28,948,141

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Acquisition

13,505,927 - - 13,505,927

Disposal/ Recovery

(13,436,584 ) - - (13,436,584 )

Loss on valuation

(109,965 ) - - (109,965 )

Amortization based on effective interest method

(7,024 ) - - (7,024 )

Others (*)

150,297 - - 150,297

Ending balance

29,050,792 - - 29,050,792
(*)

Changes due to foreign currencies translation, etc.

For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

26,795,161 - - 26,795,161

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Acquisition

12,879,766 - - 12,879,766

Disposal/ Recovery

(11,051,251 ) - - (11,051,251 )

Gain on valuation

114,000 - - 114,000

Amortization based on effective interest method

4,073 - - 4,073

Others (*)

63,060 - - 63,060

Ending balance

28,804,809 - - 28,804,809
(*)

Changes due to foreign currencies translation, etc.

(4)

During the six-month periods ended June 30, 2021, the Group sold its equity securities, designated as financial assets at FVTOCI in accordance with decision of disposal by the creditors, and the fair values at disposal dates were 84,460 million Won, and cumulative gains at disposal dates were 46,135 million Won.

9.

SECURITIES AT AMORTIZED COST

(1)

Details of securities at amortized cost as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Korean treasury and government agencies

6,959,361 6,947,495

Financial institutions

3,472,495 4,843,534

Corporates

4,721,552 4,726,075

Bond denominated in foreign currencies

576,107 508,301

Allowance for credit losses

(4,274 ) (4,566 )

Total

15,725,241 17,020,839

- 51 -

(2)

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

1)

Loss allowance

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

(4,566 ) - - (4,566 )

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Net reversal of allowance for credit losses

293 - - 293

Others (*)

(1 ) - - (1 )

Ending balance

(4,274 ) - - (4,274 )
(*)

Changes due to foreign currencies translation, etc.

For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

(5,511 ) - - (5,511 )

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Net provision of allowance for credit losses

(47 ) - - (47 )

Others (*)

1 - - 1

Ending balance

(5,557 ) - - (5,557 )
(*)

Changes due to foreign currencies translation, etc.

2)

Gross carrying amount

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

17,025,405 - - 17,025,405

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Acquisition

1,496,443 - - 1,496,443

Disposal/ Recovery

(2,812,675 ) - - (2,812,675 )

Amortization based on effective interest method

4,416 - - 4,416

Others (*)

15,926 - - 15,926

Ending balance

15,729,515 - - 15,729,515
(*)

Changes due to foreign currencies translation, etc.

For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

20,326,050 - - 20,326,050

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Acquisition

1,678,871 - - 1,678,871

Disposal/ Recovery

(3,406,644 ) - - (3,406,644 )

Amortization based on effective interest method

388 - - 388

Others (*)

17,494 - - 17,494

Ending balance

18,616,159 - - 18,616,159
(*)

Changes due to foreign currencies translation, etc.

- 52 -

10.

LOANS AND OTHER FINANCIAL ASSETS AT AMORTIZED COST

(1)

Details of loans and other financial assets at amortized cost as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Due from banks

21,733,419 9,863,160

Loans

313,781,194 302,794,182

Other financial assets

9,635,812 7,448,736

Total

345,150,425 320,106,078
(2)

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

June 30, 2021 December 31, 2020

Due from banks in local currency:

Due from Bank of Korea ('BOK')

17,283,604 6,519,226

Due from depository banks

106,475 84,195

Due from non-depository institutions

6,477 266

Due from the Korea Exchange

162 227

Others

127,625 172,914

Loss allowance

(4,094 ) (1,576 )

Sub-total

17,520,249 6,775,252

Due from banks in foreign currencies:

Due from banks on demand

2,692,865 1,608,126

Due from banks on time

207,724 296,489

Others

1,316,117 1,186,083

Loss allowance

(3,536 ) (2,790 )

Sub-total

4,213,170 3,087,908

Total

21,733,419 9,863,160
(3)

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

Counterparty

June 30, 2021

Reason of restriction

Due from banks in local currency:

Due from BOK

BOK 17,283,604

Reserve deposits

under BOK Act

Due from KSFC

KB Securities Co. Ltd.

162 Futures trading margin

Others

Korea Federation of Savings Banks and others

81,375

Guarantees, mortgage of domestic exchange transactions and others

Sub-total

17,365,141

Due from banks in foreign currencies:

Due from banks on demand

BOK and others 2,656,462 Reserve deposits under BOK Act and others

Due from banks on time

National Bank Cambodia 226 Reserve deposits and others

Others

Korea Investment & Securities and others

1,301,770

Overseas futures and options trade deposits and others

Sub-total

3,958,458

Total

21,323,599

- 53 -

Counterparty

December 31, 2020

Reason of restriction

Due from banks in local currency:

Due from BOK

BOK

6,519,226

Reserve deposits

under BOK Act

Due from KSFC

KB Securities Co. Ltd.

227

Futures trading margin

Others

Korea Federation of Savings Banks and others

89,562

Guarantees, mortgage of domestic exchange transactions and others

Sub-total

6,609,015

Due from banks in foreign currencies:

Due from banks on demand

BOK and others

1,544,492

Reserve deposits under BOK Act and others

Due from banks on time

National Bank Cambodia

54

Reserve deposits and others

Others

Korea Investment & Securities and others

1,180,570

Overseas futures and options trade deposits and others

Sub-total

2,725,116

Total

9,334,131
(4)

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

1)

Allowance for credit losses

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

(4,366 ) - - (4,366 )

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Provision for allowance for credit loss

(3,235 ) - - (3,235 )

Others (*)

(29 ) - - (29 )

Ending balance

(7,630 ) - - (7,630 )
(*)

Changes due to foreign currencies translation, etc.

For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

(4,860 ) - - (4,860 )

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Provision for allowance for credit loss

(1,305 ) - - (1,305 )

Others (*)

103 - - 103

Ending balance

(6,062 ) - - (6,062 )
(*)

Changes due to foreign currencies translation, etc.

- 54 -

2)

Gross carrying amount

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

9,867,526 - - 9,867,526

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Net increase

11,845,544 - - 11,845,544

Others (*)

27,979 - - 27,979

Ending balance

21,741,049 - - 21,741,049
(*)

Changes due to foreign currencies translation, etc.

For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

14,497,083 - - 14,497,083

Transfer to 12-month expected credit losses

- - - -

Transfer to lifetime expected credit losses

- - - -

Transfer to credit-impaired financial assets

- - - -

Net decrease

(1,523,664 ) - - (1,523,664 )

Others (*)

(20,148 ) - - (20,148 )

Ending balance

12,953,271 - - 12,953,271
(*)

Changes due to foreign currencies translation, etc.

(5)

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

June 30, 2021 December 31, 2020

Loans in local currency

260,510,080 249,264,947

Loans in foreign currencies

21,852,277 20,025,092

Domestic banker's usance

3,099,279 2,240,830

Credit card accounts

9,378,956 8,542,619

Bills bought in foreign currencies

4,993,964 5,763,427

Bills bought in local currency

134,426 133,650

Factoring receivables

40,715 38,017

Advances for customers on guarantees

28,024 31,300

Private placement bonds

604,005 353,585

Securitized loans

2,688,827 2,561,914

Call loans

2,086,802 2,352,034

Bonds purchased under resale agreements

6,139,390 10,145,749

Financial lease receivables

948,026 586,216

Installment financial bond

2,372,550 1,925,493

Others

170 380

Loan origination costs and fees

781,393 744,109

Discounted present value

(7,023 ) (6,656 )

Allowance for credit losses

(1,870,667 ) (1,908,524 )

Total

313,781,194 302,794,182

- 55 -

(6)

Changes in the allowance for credit losses of loans are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Consumers Corporates
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3

Beginning balance

(121,527 ) (84,463 ) (205,693 ) (327,460 ) (521,907 ) (388,744 )

Transfer to 12-month expected credit losses

(17,090 ) 16,288 802 (96,884 ) 67,540 29,344

Transfer to lifetime expected credit losses

10,008 (12,300 ) 2,292 15,840 (38,334 ) 22,494

Transfer to credit-impaired financial assets

2,240 14,716 (16,956 ) 1,733 24,473 (26,206 )

Net reversal (provision) of allowance for credit losses

(3,047 ) (26,459 ) (52,462 ) 82,307 (49,412 ) (86,337 )

Recovery

- - (37,106 ) - - (25,508 )

Charge-off

- - 81,855 - - 133,534

Disposal

- - 7,224 - - 15,486

Interest income from impaired loans

- - 7,126 - - 6,634

Others

93 364 3,288 (7,112 ) (2,499 ) 6,450

Ending balance

(129,323 ) (91,854 ) (209,630 ) (331,576 ) (520,139 ) (312,853 )
For the six-month period ended June 30, 2021
Credit card accounts Total
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3

Beginning balance

(62,712 ) (90,481 ) (105,537 ) (511,699 ) (696,851 ) (699,974 )

Transfer to 12-month expected credit losses

(22,258 ) 22,110 148 (136,232 ) 105,938 30,294

Transfer to lifetime expected credit losses

7,774 (8,529 ) 755 33,622 (59,163 ) 25,541

Transfer to credit-impaired financial assets

714 3,830 (4,544 ) 4,687 43,019 (47,706 )

Net reversal (provision) of allowance for credit losses

8,752 (22,880 ) (63,397 ) 88,012 (98,751 ) (202,196 )

Recovery

- - (33,196 ) - - (95,810 )

Charge-off

- - 94,160 - - 309,549

Disposal

- - - - - 22,710

Interest income from impaired loans

- - - - - 13,760

Others

(1 ) - - (7,020 ) (2,135 ) 9,738

Ending balance

(67,731 ) (95,950 ) (111,611 ) (528,630 ) (707,943 ) (634,094 )

- 56 -

For the six-month period ended June 30, 2020
Consumers Corporates
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3

Beginning balance

(85,148 ) (77,962 ) (125,588 ) (324,258 ) (297,718 ) (390,045 )

Transfer to 12-month expected credit losses

(19,356 ) 18,821 535 (30,128 ) 22,088 8,040

Transfer to lifetime expected credit losses

8,766 (10,576 ) 1,810 16,628 (73,095 ) 56,467

Transfer to credit-impaired financial assets

2,225 9,617 (11,842 ) 12,976 12,525 (25,501 )

Net reversal (provision) of allowance for credit losses

6,109 (13,315 ) (61,278 ) (74,693 ) (30,747 ) (142,540 )

Recovery

- - (33,774 ) - - (43,300 )

Charge-off

- - 91,333 - - 101,899

Disposal

48 2 346 - - 22,255

Interest income from impaired loans

- - 4,735 - - 7,622

Others

(124 ) (5 ) (131 ) (7,593 ) (84 ) 24,127

Ending balance

(87,480 ) (73,418 ) (133,854 ) (407,068 ) (367,031 ) (380,976 )
For the six-month period ended June 30, 2020
Credit card accounts Total
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3

Beginning balance

(74,726 ) (71,533 ) (128,042 ) (484,132 ) (447,213 ) (643,675 )

Transfer to 12-month expected credit losses

(13,837 ) 13,795 42 (63,321 ) 54,704 8,617

Transfer to lifetime expected credit losses

7,041 (7,438 ) 397 32,435 (91,109 ) 58,674

Transfer to credit-impaired financial assets

22,209 59,874 (82,083 ) 37,410 82,016 (119,426 )

Net reversal (provision) of allowance for credit losses

(17,597 ) (59,668 ) (22,731 ) (86,181 ) (103,730 ) (226,549 )

Recovery

- - (31,690 ) - - (108,764 )

Charge-off

- - 138,351 - - 331,583

Disposal

- - 23,653 48 2 46,254

Interest income from impaired loans

- - - - - 12,357

Others

(2 ) - - (7,719 ) (89 ) 23,996

Ending balance

(76,912 ) (64,970 ) (102,103 ) (571,460 ) (505,419 ) (616,933 )

- 57 -

(7)

Changes in the gross carrying amount of loans are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Consumers Corporates
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3

Beginning balance

125,990,038 12,016,711 537,106 149,574,932 7,328,741 717,909

Transfer to 12-month expected credit losses

3,730,443 (3,721,667 ) (8,776 ) 1,534,004 (1,501,081 ) (32,923 )

Transfer to lifetime expected credit losses

(6,030,431 ) 6,053,085 (22,654 ) (3,097,859 ) 3,143,555 (45,696 )

Transfer to credit-impaired financial assets

(64,415 ) (86,834 ) 151,249 (166,253 ) (149,253 ) 315,506

Charge-off

- - (81,855 ) - - (133,534 )

Disposal

- - (26,261 ) - - (66,527 )

Net increase (decrease)

4,935,139 (931,914 ) (25,244 ) 7,239,175 (673,197 ) (122,212 )

Ending balance

128,560,774 13,329,381 523,565 155,083,999 8,148,765 632,523
For the six-month period ended June 30, 2021
Credit card accounts Total
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3

Beginning balance

7,278,975 1,078,220 180,074 282,843,945 20,423,672 1,435,089

Transfer to 12-month expected credit losses

307,122 (306,941 ) (181 ) 5,571,569 (5,529,689 ) (41,880 )

Transfer to lifetime expected credit losses

(473,197 ) 474,086 (889 ) (9,601,487 ) 9,670,726 (69,239 )

Transfer to credit-impaired financial assets

(27,962 ) (27,424 ) 55,386 (258,630 ) (263,511 ) 522,141

Charge-off

- - (94,160 ) - - (309,549 )

Disposal

- - - - - (92,788 )

Net increase (decrease)

973,542 (88,350 ) 44,553 13,147,856 (1,693,461 ) (102,903 )

Ending balance

8,058,480 1,129,591 184,783 291,703,253 22,607,737 1,340,871
For the six-month period ended June 30, 2020
Consumers Corporates
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3

Beginning balance

111,253,283 12,448,807 417,674 134,443,979 4,910,598 740,257

Transfer to 12-month expected credit losses

4,318,903 (4,310,929 ) (7,974 ) 1,067,885 (1,046,149 ) (21,736 )

Transfer to lifetime expected credit losses

(4,980,916 ) 5,002,670 (21,754 ) (2,571,677 ) 2,646,989 (75,312 )

Transfer to credit-impaired financial assets

(77,204 ) (118,765 ) 195,969 (235,257 ) (115,332 ) 350,589

Charge-off

- - (91,333 ) - - (101,899 )

Disposal

(3,920,591 ) (3,971 ) (16,378 ) - - (42,390 )

Net increase (decrease)

8,332,255 (1,442,779 ) (35,155 ) 8,840,031 (833,148 ) (105,787 )

Ending balance

114,925,730 11,575,033 441,049 141,544,961 5,562,958 743,722
For the six-month period ended June 30, 2020
Credit card accounts Total
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3

Beginning balance

7,278,467 885,832 228,367 252,975,729 18,245,237 1,386,298

Transfer to 12-month expected credit losses

266,322 (266,266 ) (56 ) 5,653,110 (5,623,344 ) (29,766 )

Transfer to lifetime expected credit losses

(305,371 ) 305,870 (499 ) (7,857,964 ) 7,955,529 (97,565 )

Transfer to credit-impaired financial assets

(51,913 ) (75,435 ) 127,348 (364,374 ) (309,532 ) 673,906

Charge-off

- - (138,351 ) - - (331,583 )

Disposal

- - (43,781 ) (3,920,591 ) (3,971 ) (102,549 )

Net increase (decrease)

(296,819 ) (50,674 ) 9,399 16,875,467 (2,326,601 ) (131,543 )

Ending balance

6,890,686 799,327 182,427 263,361,377 17,937,318 1,367,198
(8)

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

June 30, 2021 December 31, 2020

Cash Management Account asset (CMA asset)

215,000 210,000

Receivables

6,325,406 3,809,929

Accrued income

934,797 864,107

Telex and telephone subscription rights and refundable deposits

885,906 936,878

Domestic exchange settlement debit

1,149,524 1,518,775

Other assets

212,060 192,342

Allowance for credit losses

(86,881 ) (83,295 )

Total

9,635,812 7,448,736

- 58 -

(9)

Changes in the allowances for credit losses on other financial assets are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

(3,666 ) (5,450 ) (74,179 ) (83,295 )

Transfer to 12-month expected credit losses

(204 ) 196 8 -

Transfer to lifetime expected credit losses

156 (173 ) 17 -

Transfer to credit-impaired financial assets

178 414 (592 ) -

Reversal (Provision) of allowance for credit losses

564 (930 ) (4,179 ) (4,545 )

Charge-off

- - 987 987

Disposal

- - 557 557

Others

(1,873 ) (4 ) 1,292 (585 )

Ending balance

(4,845 ) (5,947 ) (76,089 ) (86,881 )
For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

(3,196 ) (1,666 ) (72,277 ) (77,139 )

Transfer to 12-month expected credit losses

(140 ) 131 9 -

Transfer to lifetime expected credit losses

536 (150 ) (386 ) -

Transfer to credit-impaired financial assets

26 142 (168 ) -

Provision of allowance for credit losses

(767 ) (262 ) (3,272 ) (4,301 )

Charge-off

- - 248 248

Disposal

- - 489 489

Others

545 - (11 ) 534

Ending balance

(2,996 ) (1,805 ) (75,368 ) (80,169 )
(10)

Changes in the gross carrying amount of other financial assets are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

7,267,426 76,418 188,187 7,532,031

Transfer to 12-month expected credit losses

7,997 (7,984 ) (13 ) -

Transfer to lifetime expected credit losses

(13,729 ) 13,759 (30 ) -

Transfer to credit-impaired financial assets

(800 ) (1,038 ) 1,838 -

Charge-off

- - (987 ) (987 )

Disposal

- - (686 ) (686 )

Net increase (decrease)

2,157,975 26,038 8,322 2,192,335

Ending balance

9,418,869 107,193 196,631 9,722,693
For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

8,059,844 92,647 117,874 8,270,365

Transfer to 12-month expected credit losses

8,420 (8,404 ) (16 ) -

Transfer to lifetime expected credit losses

(12,735 ) 12,752 (17 ) -

Transfer to credit-impaired financial assets

(1,743 ) (1,096 ) 2,839 -

Charge-off

- - (248 ) (248 )

Disposal

- - (549 ) (549 )

Net increase (decrease)

4,288,900 (31,361 ) 51,841 4,309,380

Ending balance

12,342,686 64,538 171,724 12,578,948

- 59 -

11.

FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

(1)

The fair value hierarchy

The fair value hierarchy for financial instruments is determined by the amount of observable market data. The specific financial instruments characteristics and market condition such as the existence of the transactions among market participants and transparency are reflected to the market observable inputs. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities. The Group maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value of its financial assets and financial liabilities. Fair value is measured based on the perspective of a market participant. As such, even when market assumptions are not readily available, the Group's own assumptions reflect those that market participants would use for measuring the assets or liabilities at the measurement date.

The fair value measurement is described in the one of the following three levels used to classify fair value measurements:

•

Level 1-fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities. The types of financial assets or liabilities generally included in Level 1 are publicly traded equity securities, derivatives, and debt securities issued by governmental bodies.

•

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. derived from prices). The types of financial assets or liabilities generally included in Level 2 are debt securities not traded in active markets and derivatives traded in OTC but not required significant judgment.

•

Level 3- fair value measurements are those derived from valuation technique that include inputs for the assets or liabilities that are not based on observable market data (unobservable inputs). The types of financial assets or liabilities generally included in Level 3 are non-public securities and derivatives and debt securities of which valuation techniques require significant judgments and subjectivity.

The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Group's assessment of the significance of a particular input to a fair value measurement in its entirety requires judgment and consideration of inherent factors of the asset or liability.

- 60 -

(2)

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

June 30, 2021
Level 1 (*) Level 2 (*) Level 3 Total

Financial assets:

Financial assets at FVTPL

Deposits

70,150 - - 70,150

Debt securities

717,328 1,775,743 3,853 2,496,924

Equity securities

32,950 - 425,973 458,923

Capital contributions

- - 987,813 987,813

Beneficiary certificates

31,313 1,635,007 2,034,821 3,701,141

Loans

- 139,666 291,471 431,137

Derivative assets (Designated for trading)

2,702 4,021,433 533 4,024,668

Others

- - 93,765 93,765

Sub-total

854,443 7,571,849 3,838,229 12,264,521

Financial assets at FVTOCI

Debt securities

5,240,322 23,810,470 - 29,050,792

Equity securities

664,816 - 569,283 1,234,099

Sub-total

5,905,138 23,810,470 569,283 30,284,891

Derivative assets (Designated for hedging)

- 129,562 - 129,562

Total

6,759,581 31,511,881 4,407,512 42,678,974

Financial liabilities:

Financial liabilities at FVTPL

Deposits due to customers

70,394 - - 70,394

Derivative liabilities (Designated for trading)

4,867 3,630,190 22,647 3,657,704

Securities sold

200,083 - - 200,083

Sub-total

275,344 3,630,190 22,647 3,928,181

Derivative liabilities (Designated for hedging)

- 44,045 - 44,045

Total

275,344 3,674,235 22,647 3,972,226
(*)

There were no transfers between Level 1 and Level 2 of financial assets and liabilities measured at fair value. The Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions have changed.

- 61 -

December 31, 2020
Level 1 (*) Level 2 (*) Level 3 Total

Financial assets:

Financial assets at FVTPL

Deposits

48,796 - - 48,796

Debt securities

516,597 2,365,882 4,618 2,887,097

Equity securities

35,422 - 450,371 485,793

Capital contributions

- - 865,685 865,685

Beneficiary certificates

24,895 869,852 1,917,811 2,812,558

Loans

- 467,229 209,062 676,291

Derivative assets (Designated for trading)

18,416 6,875,454 7,872 6,901,742

Others

- - 84,979 84,979

Sub-total

644,126 10,578,417 3,540,398 14,762,941

Financial assets at FVTOCI

Debt securities

3,092,237 25,855,904 - 28,948,141

Equity securities

510,073 - 570,715 1,080,788

Sub-total

3,602,310 25,855,904 570,715 30,028,929

Derivative assets (Designated for hedging)

- 174,820 - 174,820

Total

4,246,436 36,609,141 4,111,113 44,966,690

Financial liabilities:

Financial liabilities at FVTPL

Deposits due to customers

49,279 - - 49,279

Derivative liabilities (Designated for trading)

6,024 6,433,727 20,136 6,459,887

Securities sold

285,026 - - 285,026

Sub-total

340,329 6,433,727 20,136 6,794,192

Financial liabilities at FVTPL designated as upon initial recognition

Equity-linked securities

- - 19,630 19,630

Derivative liabilities (Designated for hedging)

- 64,769 - 64,769

Total

340,329 6,498,496 39,766 6,878,591
(*)

There were no transfers between Level 1 and Level 2 of financial assets and liabilities measured at fair value. The Group recognizes transfers among levels at the end of reporting period in which events have occurred or conditions have changed.

- 62 -

Financial assets and liabilities at FVTPL, financial liabilities at FVTPL designated as upon initial recognition, financial assets at FVTOCI, and derivative assets and liabilities are recognized at fair value. Fair value is the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date.

Financial instruments are measured at fair value using a quoted market price in active markets. If there is no active market for a financial instrument, the Group determines the fair value using valuation methods. Valuation methods and input variables for each type of financial instruments are as follows:

1)

Valuation methods and input variables for each type of financial instrument classified into level 2 in June 30, 2021 and December 31, 2020 are as follows:

Valuation methods

Input variables

Debt securities

Fair value is measured by discounting the future cash flows of debt securities applying the risk-free market rate with credit spread.

Risk-free market rate and credit spread

Beneficiary certificates

The beneficiary certificates classified as Level 2 are MMF and are measured at the standard price.

Standard price

Derivatives

Fair value is measured by models such as option model (Closed form), DCF model, FDM and Monte Carlo Simulation.

Discount rate, values of underlying assets such as foreign exchange rate and stock prices, volatility, risk-free market rate, forward rate, etc.

Loans

The future cash flows of debt instruments are measured at a discount by applying the market interest rate applied to entities with similar creditworthiness to the debtor.

Risk-free market rate and credit spread

2)

Valuation methods and input variables for each type of financial instrument classified into level 3 in June 30, 2021 and December 31, 2020 are as follows:

Valuation methods

Input variables

Loans

Fair value is calculated by using the Binomial Tree, which is a valuation technique commonly used in the market taking into account the price and variability of the underlying asset, and LSMC. The future cash flows of debt instruments are measured at a discount by applying the market interest rate applied to entities with similar creditworthiness to the debtor.

Values of underlying assets, volatility, risk-free market rate and credit spread

Debt securities

The future cash flows of debt instruments are measured at a discount by applying the market interest rate applied to entities with similar creditworthiness to debt securities issuers.

Risk-free market rate and credit spread

Equity securities, capital contributions and Beneficiary certificates

Among DCF (Discounted Cash Flow) Model, FCFE (Free Cash Flow to Equity) Model, Comparable Company Analysis, Dividend Discount Model, Risk-adjusted Rate of Return Method, Net Asset Value Method, LSMC, and Binomial Tree, more than one method is used given the characteristic of the subject of fair value measurement.

Risk-free market rate, market risk premium, corporate Beta, stock prices, volatility of underlying asset, net asset of the investment association and discount rate

Derivatives

Fair value is measured by models such as option model (Closed form), DCF model, FDM and Monte Carlo Simulation.

Risk-free market rate, discount rate, values of underlying assets such as foreign exchange rate and stock prices, volatility, etc.

Others

Fair value is measured by DCF model, LSMC, etc.

Stock prices, volatility of underlying assets, etc.

- 63 -

Valuation methods of financial assets and liabilities measured at fair value and classified into Level 3 and significant but unobservable inputs are as follows:

Fair value
measurement
technique

Type

Input variable

Range(%)

Impact of changes in significant
unobservable inputs on fair value
measurement

Loans

Binomial Tree Stock prices, Volatility of underlying asset 34.96% Variation of fair value increases as volatility of underlying asset increases.
LSMC Stock prices, Volatility of underlying asset 16.63% Variation of fair value increases as volatility of underlying asset increases.

Derivative assets

Option valuation model and others Interest rate related Correlation coefficient 0.90~0.98 Variation of fair value increases as correlation coefficient increases.
Volatility of underlying asset 21.78~103.13% Variation of fair value increases as volatility of underlying assets increases.
Equity related Correlation coefficient 0.25~0.76 Variation of fair value increases as correlation coefficient increases.
Volatility of underlying asset - Variation of fair value increases as volatility of underlying assets increases.
DCF model Interest rate related Credit risk adjustment ratio 100.00% Variation of fair value decreases as credit risk adjustment ratio increases.

Derivative liabilities

Option valuation model and others Interest rate related Correlation coefficient 0.90~0.98 Variation of fair value increases as correlation coefficient increases.
Volatility of underlying asset 21.78~103.13% Variation of fair value increases as volatility of underlying assets increases.
Equity related Correlation coefficient 0.25~0.76 Variation of fair value increases as correlation coefficient increases.
Volatility of underlying asset - Variation of fair value increases as volatility of underlying assets increases.

Equity securities, capital contributions, and beneficiary certificates

LSMC

Stock prices, Volatility of underlying

asset

17.20%

Variation of fair value increases as volatility of underlying asset

increases.

DCF model and others Discount rate 0.00~37.98% Fair value increases as discount rate decreases.
Terminal growth rate 1.00% Fair value increases as terminal growth rate increases.
Liquidation value 0.00% Variation of liquidation value increases as volatility of underlying assets increases

- 64 -

Fair value
measurement
technique

Type

Input variable

Range(%)

Impact of changes in significant
unobservable inputs on fair value
measurement

Others

Income approach Discount rate 12.69% Fair value increases as discount rate decreases.
Growth rate 1.00% Fair value increases as growth rate increases.
LSMC Stock prices, Volatility of underlying asset 16.63~37.31% Variation of fair value increases as volatility of underlying asset increases.

Fair value of financial assets and liabilities classified into Level 3 is measured by the Group using its own valuation methods or using external specialists. Unobservable inputs used in the fair value measurements are produced by the internal system of the Group, and the appropriateness of inputs is reviewed regularly.

(3)

Changes in financial assets and liabilities measured at fair value classified into Level 3 are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Beginning
balance 		Net Income
(loss)
(*1) 		Other
comprehensive
income 		Purchases/
issuances 		Disposals /
settlements 		Transfer to
or out of Level 3
(*2) 		Ending
balance

Financial assets:

Financial assets at FVTPL

Debt securities

4,618 (765 ) - - - - 3,853

Equity securities

450,371 (12,065 ) - 13,083 (25,416 ) - 425,973

Capital contributions

865,685 35,844 - 209,861 (123,577 ) - 987,813

Beneficiary certificates

1,917,811 23,203 - 166,461 (72,654 ) - 2,034,821

Loans

209,062 9,231 - 444,975 (371,797 ) - 291,471

Derivative assets

7,872 (243 ) - 512 (1,770 ) (5,838 ) 533

Others

84,979 6,944 - 6,998 (5,156 ) - 93,765

Sub-total

3,540,398 62,149 - 841,890 (600,370 ) (5,838 ) 3,838,229

Financial assets at FVTOCI

Equity securities

570,715 - (1,555 ) 242 (119 ) - 569,283

Total

4,111,113 62,149 (1,555 ) 842,132 (600,489 ) (5,838 ) 4,407,512

Financial liabilities:

Financial liabilities at FVTPL

Derivative liabilities

20,136 25,916 - (4,642 ) (12,509 ) (6,254 ) 22,647

Financial liabilities at FVTPL designated as upon initial recognition

Equity-linked securities

19,630 (102 ) - - (19,528 ) - -

Derivative liabilities (Designated for hedging)

- - - - - - -

Total

39,766 25,814 - (4,642 ) (32,037 ) (6,254 ) 22,647
(*1)

The losses that increase financial liabilities are presented as positive amounts, and the gains that decrease financial liabilities are presented as negative amounts. The gain amounting to 27,221 million Won for the six-month period ended June 30, 2021, which is from financial assets and liabilities that the Group holds as at the end of the period, has been recognized in net gain(loss) on financial assets at FVTPL and net gain(loss) on financial assets at FVTOCI in the consolidated statement of comprehensive income.

(*2)

The Group recognizes transfers between levels at the end of reporting period within such events have occurred or conditions have changed.

- 65 -

For the six-month period ended June 30, 2020
Beginning
balance 		Net
Income (loss)
(*1) 		Other
comprehensive
income 		Purchases/
issuances 		Disposals /
settlements 		Transfer to or
out of Level 3
(*2) 		Ending
balance

Financial assets:

Financial assets at FVTPL

Debt securities

5,826 (9 ) - - (52 ) - 5,765

Equity securities

528,621 13,220 - 10,472 (13,714 ) 31 538,630

Capital contributions

515,199 12,324 - 98,219 (12,006 ) - 613,736

Beneficiary certificates

1,275,734 15,939 - 315,069 (138,319 ) - 1,468,423

Loans

152,629 4,556 - 93,987 (62,274 ) - 188,898

Derivative assets

25,048 95,112 - 10,891 (19,233 ) (8,387 ) 103,431

Sub-total

2,503,057 141,142 - 528,638 (245,598 ) (8,356 ) 2,918,883

Financial assets at FVTOCI

Equity securities

493,698 - (56,593 ) 3,698 (630 ) 2,192 442,365

Total

2,996,755 141,142 (56,593 ) 532,336 (246,228 ) (6,164 ) 3,361,248

Financial liabilities:

Financial liabilities at FVTPL

Derivative liabilities

72,039 495 - 11,001 (49,806 ) (14,308 ) 19,421

Financial liabilities at FVTPL designated as upon initial recognition

Equity-linked securities

87,626 (8,421 ) - - (54,719 ) - 24,486

Derivative liabilities (Designated for hedging)

321 - - - (321 ) - -

Total

159,986 (7,926 ) - 11,001 (104,846 ) (14,308 ) 43,907
(*1)

The losses that increase financial liabilities are presented as positive amounts, and the gains that decrease financial liabilities are presented as negative amounts. The gain amounting to 140,315 million Won for the six-month period ended June 30, 2020, which is from financial assets and liabilities that the Group holds as at the end of the period, has been recognized in net gain(loss) on financial assets at FVTPL and net gain(loss) on financial assets at FVTOCI in the consolidated statement of comprehensive income.

(*2)

The Group recognizes transfers between levels at the end of reporting period within such events have occurred or conditions have changed.

- 66 -

(4)

Sensitivity analysis results on reasonable fluctuation of the significant unobservable input variables for the fair value of Level 3 financial instruments are as follows.

The sensitivity analysis of the financial instruments has been performed by classifying with favorable and unfavorable changes based on how changes in unobservable assumptions would have effects on the fluctuations of financial instruments' value. When the fair value of a financial instrument is affected by more than one unobservable assumption, the below table reflects the most favorable or the most unfavorable changes which resulted from varying the assumptions individually. The sensitivity analysis was performed for two types of level 3 financial instruments: (1) interest rate related derivatives, currency related derivatives, equity related derivatives, equity-linked securities beneficiary certificates and loans of which fair value changes are recognized as net income; (2) equity securities of which fair value changes are recognized as other comprehensive income.

Meanwhile, among the financial instruments that are classified as Level 3 amounting to 4,430,159 million Won and 4,150,879 million Won as of June 30, 2021 and December 31, 2020 respectively, equity instruments of 3,270,072 million Won and 3,052,432 million Won whose carrying amount are considered to represent the reasonable approximation of fair value are excluded from the sensitivity analysis.

The sensitivity on fluctuation of input variables by financial instruments as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):

June 30, 2021
Net income (loss) Other comprehensive income (loss)
Favorable Unfavorable Favorable Unfavorable

Financial assets:

Financial assets at FVTPL

Derivative assets (*1)

620 97 - -

Loans (*2)

1,490 (1,466 ) - -

Debt securities

11 (9 ) - -

Equity securities (*2) (*3) (*4)

6,679 (6,779 ) - -

Beneficiary certificates (*4)

1,321 (1,211 ) - -

Others (*2)

1,066 (1,014 ) - -

Financial assets at FVTOCI

Equity securities (*3) (*4)

- - 33,395 (25,335 )

Total

11,187 (10,382 ) 33,395 (25,335 )

Financial liabilities:

Financial liabilities at FVTPL

Derivative liabilities (*1)

292 (384 ) - -

Total

292 (384 ) - -
(*1)

Fair value changes of equity related derivatives assets and liabilities are calculated by increasing or decreasing historical volatility of the stock price and correlation, which are major unobservable variables, by 10%, respectively. In the case of interest rate related derivative assets and liabilities, fair value changes are calculated by increasing or decreasing the volatility of interest rate, which are major unobservable variables, by 10%.

(*2)

Fair value changes of equity securities are calculated by increasing or decreasing stock prices (-10%~10%) and volatility (-10~10%). The stock prices and volatility are major unobservable variables.

(*3)

Fair value changes of equity securities are calculated by increasing or decreasing terminal growth rate (-0.5%~0.5%) and discount rate (-1~1%) or liquidation value (-1~1%). The growth rate, discount rate, and liquidation value are major unobservable variables.

(*4)

Even if the sensitivity analysis of the capital contributions and beneficiary certificates is not possible in practice, fair value changes of beneficiary certificates and other securities whose major unobservable variables are composed of the real estate are calculated by increasing or decreasing price fluctuation rate of real estate which is underlying assets and discount rate by 1%.

- 67 -

December 31, 2020
Net income (loss) Other comprehensive income (loss)
Favorable Unfavorable Favorable Unfavorable

Financial assets:

Financial assets at FVTPL

Derivative assets (*1)

110 (257 ) - -

Loans (*2)

933 (932 ) - -

Debt securities

13 (10 ) - -

Equity securities (*2) (*3) (*4)

8,539 (7,337 ) - -

Beneficiary certificates (*4)

1,403 (1,537 ) - -

Others (*2)

640 (547 ) - -

Financial assets at FVTOCI

Equity securities (*3) (*4)

- - 21,587 (16,740 )

Total

11,638 (10,620 ) 21,587 (16,740 )

Financial liabilities:

Financial liabilities at FVTPL

Derivative liabilities (*1)

776 (405 ) - -

Financial liabilities at FVTPL designated as upon initial recognition

Equity-linked securities (*1)

57 (45 ) - -

Total

833 (450 ) - -
(*1)

Fair value changes of equity related derivatives assets and liabilities and equity-linked securities are calculated by increasing or decreasing historical volatility of the stock price and correlation, which are major unobservable variables, by 10%, respectively. In the case of interest rate related derivative assets and liabilities, fair value changes are calculated by increasing or decreasing the volatility of interest rate, which are major unobservable variables, by 10%.

(*2)

Fair value changes of equity securities are calculated by increasing or decreasing stock prices (-10%~10%) and volatility (-10~10%). The stock prices and volatility are major unobservable variables.

(*3)

Fair value changes of equity securities are calculated by increasing or decreasing terminal growth rate (-0.5%~0.5%) and discount rate (-1~1%) or liquidation value (-1~1%). The growth rate, discount rate, and liquidation value are major unobservable variables.

(*4)

Even if the sensitivity analysis of the capital contributions and beneficiary certificates is not possible in practice, fair value changes of beneficiary certificates and other securities whose major unobservable variables are composed of the real estate are calculated by increasing or decreasing price fluctuation rate of real estate which is underlying assets and discount rate by 1%.

- 68 -

(5)

Fair value and carrying amount of financial assets and liabilities that are recorded at amortized cost are as follows (Unit: Korean Won in millions):

June 30, 2021
Fair value Book
value
Level 1 Level 2 Level 3 Total

Financial assets:

Securities at amortized cost

2,328,704 13,475,532 - 15,804,236 15,725,241

Loans and other financial assets at amortized cost

- - 342,946,182 342,946,182 345,150,425

Financial liabilities:

Deposits due to customers

- 302,658,752 - 302,658,752 302,492,676

Borrowings

- 22,086,961 433,613 22,520,574 22,545,862

Debentures

- 40,871,588 - 40,871,588 40,917,952

Other financial liabilities

- 20,670,368 290,368 20,960,736 21,208,340
December 31, 2020
Fair value Book
value
Level 1 Level 2 Level 3 Total

Financial assets:

Securities at amortized cost

2,968,875 14,299,748 - 17,268,623 17,020,839

Loans and other financial assets at amortized cost

- - 318,144,845 318,144,845 320,106,078

Financial liabilities:

Deposits due to customers

- 291,767,282 - 291,767,282 291,477,279

Borrowings

- 20,586,930 176,745 20,763,675 20,745,466

Debentures

- 37,931,989 - 37,931,989 37,479,358

Other financial liabilities

- 13,305,067 286,489 13,591,556 13,808,386

The fair values of financial instruments are measured using quoted market price in active markets. In case there is no active market for financial instruments, the Group determines the fair value by using valuation methods. Valuation methods and input variables for financial assets and liabilities that are measured at amortized cost are given as follows:

Valuation methods

Input variables

Securities at amortized cost

The fair value is measured by discounting the projected cash flows of debt securities by applying risk-free market rate with credit spread.

Risk-free market rate and credit spread
Loans and other financial assets at amortized cost

The fair value is measured by discounting the projected cash flows of loan products by applying the market discount rate that has been applied to a proxy company that has similar credit rating to the debtor.

Risk-free market rate, credit spread and prepayment rate
Deposits due to customers, borrowings, debentures and other financial liabilities

The fair value is measured by discounting the projected cash flows of debt products by applying the market discount rate that is reflecting credit rating of the Group.

Risk-free market rate, credit spread and forward rate

- 69 -

(6)

Financial instruments by category

Carrying amounts of financial assets and liabilities by each category are as follows (Unit: Korean Won in millions):

June 30, 2021
Financial
assets at
FVTPL 		Financial
assets at
FVTOCI 		Financial
assets at
amortized
cost 		Derivatives
assets
(Designated
for hedging) 		Total

Financial assets

Deposits

70,150 - 21,733,419 - 21,803,569

Securities

7,738,566 30,284,891 15,725,241 - 53,748,698

Loans

431,137 - 313,781,194 - 314,212,331

Derivative assets

4,024,668 - - 129,562 4,154,230

Other financial assets

- - 9,635,812 - 9,635,812

Total

12,264,521 30,284,891 360,875,666 129,562 403,554,640
June 30, 2021
Financial
liabilities at
FVTPL 		Financial
liabilities at
amortized cost 		Derivatives
liabilities
(Designated
for hedging) 		Total

Financial liabilities

Deposits due to customers

70,394 302,492,676 - 302,563,070

Borrowings

200,083 22,545,862 - 22,745,945

Debentures

- 40,917,952 - 40,917,952

Derivative liabilities

3,657,704 - 44,045 3,701,749

Other financial liabilities

- 21,208,340 - 21,208,340

Total

3,928,181 387,164,830 44,045 391,137,056
December 31, 2020
Financial
assets at
FVTPL 		Financial
assets at
FVTOCI 		Financial
assets at
amortized
cost 		Derivatives
assets
(Designated for
hedging) 		Total

Financial assets

Deposits

48,796 - 9,863,160 - 9,911,956

Securities

7,136,112 30,028,929 17,020,839 - 54,185,880

Loans

676,291 - 302,794,182 - 303,470,473

Derivative assets

6,901,742 - - 174,820 7,076,562

Other financial assets

- - 7,448,736 - 7,448,736

Total

14,762,941 30,028,929 337,126,917 174,820 382,093,607
December 31, 2020
Financial
liabilities at
FVTPL 		Financial
liabilities
designated
at FVTPL 		Financial
liabilities at
amortized cost 		Derivatives
liabilities
(Designated for
hedging) 		Total

Financial liabilities

Deposits due to customers

49,279 - 291,477,279 - 291,526,558

Borrowings

285,026 19,630 20,745,466 - 21,050,122

Debentures

- - 37,479,358 - 37,479,358

Derivative liabilities

6,459,887 - - 64,769 6,524,656

Other financial liabilities

- - 13,808,386 - 13,808,386

Total

6,794,192 19,630 363,510,489 64,769 370,389,080

- 70 -

(7)

Income or expense from financial instruments by category

Income or expense from financial assets and liabilities by each category during the six-month periods ended June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Interest
income
(expense) 		Fees and
commissions
income 		Reversal
(provision) of
credit loss 		Gain (loss) on
valuation and
transactions 		Others Total

Financial assets at FVTPL

22,420 (42 ) - 136,407 114,442 273,227

Financial assets at FVTOCI

175,607 840 (2,097 ) 45,059 16,296 235,705

Securities at amortized cost

161,372 - 293 - - 161,665

Loans and other financial assets at amortized cost

4,351,072 244,135 (220,715 ) 38,680 - 4,413,172

Financial liabilities at amortized cost

(1,384,080 ) 1,114 - - - (1,382,966 )

Net derivatives (designated for hedging)

- - - 34,380 - 34,380

Total

3,326,391 246,047 (222,519 ) 254,526 130,738 3,735,183
For the six-month period ended June 30, 2020
Interest
income
(expense) 		Fees and
commissions
income 		Reversal
(provision) of
credit loss 		Gain (loss) on
valuation and
transactions 		Others Total

Financial assets at FVTPL

26,210 (613 ) - 401,589 54,382 481,568

Financial assets at FVTOCI

241,000 102 (782 ) 11,027 16,620 267,967

Securities at amortized cost

202,060 - (47 ) - - 202,013

Loans and other financial assets at amortized cost

4,446,733 197,667 (422,066 ) 32,662 - 4,254,996

Financial liabilities at amortized cost

(1,969,872 ) 1,133 - - - (1,968,739 )

Net derivatives (designated for hedging)

- - - 14,942 - 14,942

Total

2,946,131 198,289 (422,895 ) 460,220 71,002 3,252,747

- 71 -

12.

INVESTMENTS IN JOINT VENTURES AND ASSOCIATES

(1)

Investments in associates accounted for using the equity method of accounting are as follows:

Percentage of ownership
(%)

Joint ventures and associates

Main business

June 30,
2021 		December 31,
2020 		Location Financial
statements as of

Woori Bank

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

Freight & staffing services 4.9 4.9 Korea 2021.5.31(*4)

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

Credit information 9.9 9.9 Korea 2021.6.30

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

Security service 15.0 15.0 Korea 2021.5.31(*4)

Wongwang Co., Ltd. (*3)

Wholesale and real estate 29.0 29.0 Korea -

Sejin Construction Co., Ltd. (*3)

Construction 29.6 29.6 Korea -

ARES-TECH Co., Ltd. (*3)

Electronic component manufacturing 23.4 23.4 Korea -

Sinseong Trading Co., Ltd. (*3)

Manufacturing 27.2 27.9 Korea -

Reading Doctors Co., Ltd. (*3)

Other services 35.4 35.4 Korea -

Cultizm Korea LTD Co., Ltd. (*3)

Wholesale and retail sales 31.3 31.3 Korea -

NK Eng Co., Ltd. (*3)

Manufacturing 23.1 23.1 Korea -

Beomgyo., Ltd. (*3)

Telecommunication equipment retail sales 23.1 23.1 Korea -

Woori Growth Partnerships New Technology Private Equity Fund

Other financial services 23.1 23.1 Korea 2021.6.30

2016KIF-IMM Woori Bank Technology Venture Fund

Other financial services 20.0 20.0 Korea 2021.6.30

K BANK Co., Ltd. (*2)

Finance 26.2 26.2 Korea 2021.5.31(*4)

Smart Private Equity Fund No. 2 (*3)

Other financial services - 20.0 Korea -

Woori Bank-Company K Korea Movie Asset Fund

Other financial services 25.0 25.0 Korea 2021.6.30

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

Finance - 50.0 Korea -

Partner One Value Up I Private Equity Fund

Other financial services 23.3 23.3 Korea 2021.6.30

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

Other financial services 20.0 20.0 Korea 2021.6.30

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

Other financial services 25.0 25.0 Korea 2021.6.30

LOTTE CARD Co., Ltd.

Credit card and installment financing 20.0 20.0 Korea 2021.3.31(*4)

Together-Korea Government Private Pool Private Securities Investment Trust No. 3

Other financial services 100.0 100.0 Korea 2021.6.30

Genesis Environmental Energy Company 1st Private Equity Fund

Trust and collective investment 24.8 24.8 Korea 2021.3.31(*4)

Union Technology Finance Investment Association

Trust and collective investment 29.7 29.7 Korea 2021.3.31(*4)

Woori Bank (*5)

Japanese Hotel Real Estate Private Equity Fund 2

Other financial services 19.9 19.9 Korea 2021.6.30

Woori G Clean Energy No. 1

Investment trust and discretionary investment business 29.3 29.3 Korea 2021.6.30

Woori Goseong Power EBL Private Special Asset Fund

Trust and collective investment 16.7 16.7 Korea 2021.6.30

- 72 -

Percentage of ownership
(%)

Joint ventures and associates

Main business

June 30,
2021 		December 31,
2020 		Location Financial
statements as of

Woori Seoul Beltway Private Special Asset Fund

Trust and collective investment 25.0 25.0 Korea 2021.6.30

Woori Corporate Private Securities Fund 1 (Bond)

Collective investment business 20.0 - Korea 2021.6.30

Woori G Star Private Placement Investment Trust No. 33 [FI]

Collective investment business 15.8 - Korea 2021.6.30

Woori Multi Return Private Securities Investment Trust 3 (Balanced Bond)

Collective investment business 20.0 - Korea 2021.6.30

Woori Short-term Bond Securities Investment Trust (Bond) Class C-F

Collective investment business 3.4 - Korea 2021.6.30

Woori Financial Capital Co., Ltd.

AJU TAERIM 1st Fund

Other financial services 25.6 25.6 Korea 2021.6.30

Portone-Cape Fund No. 1

Other financial services 20.0 20.0 Korea 2021.6.30

KIWOOM PE AJU Investment Fund (*6)

Other financial services 9.1 9.1 Korea 2021.6.30

Woori Investment Bank Co., Ltd. (*5)

Woori FirstValue Private Real Estate Fund No. 2

Real estate business 12.0 12.0 Korea 2021.6.30

Woori Asset Management Co. Ltd.

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

Collective investment business 27.2 21.8 Korea 2021.6.30

Woori Star50 Master Fund Class C-F (*7)

Collective investment business 45.1 24.5 Korea -

Woori Private Equity Asset Management Co., Ltd.

Uri Hanhwa Eureka Private Equity Fund (*2)

Other financial services 0.8 0.8 Korea 2021.6.30

Aarden Woori Apparel 1st Private Equity Fund (*2)

Other financial services 0.5 - Korea 2021.6.30

Japanese Hotel Real Estate Private Equity Fund 1

Godo Kaisha Oceanos 1

Other financial services 47.8 47.8 Japan 2021.4.30(*4)

Woori bank and Woori card Co., Ltd. (*5)

Dongwoo C & C Co., Ltd. (*3)

Construction 24.5 24.5 Korea -

SJCO Co., Ltd. (*3)

Aggregate transportation and wholesale 28.7 28.7 Korea -

G2 Collection Co., Ltd. (*3)

Wholesale and retail sales 29.2 29.2 Korea -

The Base Enterprise Co., Ltd. (*3)

Manufacturing 48.4 48.4 Korea -

Kyesan Engineering Co., Ltd. (*3)

Construction 23.3 23.3 Korea -

Good Software Lap Co., Ltd. (*3)

Service 29.4 29.4 Korea -

QTS Shipping Co., Ltd. (*3)

Complex transportation brokerage 49.8 49.8 Korea -

DAEA SNC Co., Ltd. (*3)

Wholesale and retail sales 25.5 25.5 Korea -

Force TEC Co., Ltd.

Manufacturing 24.5 25.8 Korea 2021.3.31(*4)

PREXCO Co., Ltd. (*3)

Manufacturing 28.1 28.1 Korea -

JiWon Plating Co., Ltd. (*3)

Plating 20.8 20.8 Korea -

- 73 -

Percentage of ownership
(%)

Joint ventures and associates

Main business

June 30,
2021 		December 31,
2020 		Location Financial
statements as of

Youngdong Sea Food Co., Ltd. (*3)

Processed sea food manufacturing 24.5 24.5 Korea -

KUM HWA Co., Ltd.

Telecommunication equipment retail sales 20.1 - Korea 2020.12.31(*4)

Woori bank and Woori Financial Capital Co., Ltd. (*5)

JC Assurance No. 2 Private Equity Fund

Collective investment business 29.3 29.3 Korea 2021.6.30

Dream Company Growth no. 1 PEF

Collective investment business 27.8 27.8 Korea 2021.6.30

HMS-Oriens 1st Fund

Trust and collective investment 22.8 22.8 Korea 2021.6.30

Woori G Senior Loan No. 1

Investment trust and discretionary investment business 21.7 21.7 Korea 2021.6.30

Genesis Eco No. 1 Private Equity Fund

Other financial services 29 - Korea 2021.6.30

PARATUSWOORI MATERIALS PARTS EQUIPMENT PRIVATE EQUITY FUND

Other financial services 29.9 - Korea 2021.6.30

Woori Bank and Woori Investment Bank Co., Ltd. (*5)

PCC-Woori LP Secondary Fund

Other financial services 38.8 38.8 Korea 2021.6.30

Woori bank and Woori Asset Management Co., Ltd. (*5)

Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1

Collective investment business 26.5 23.3 Korea 2021.6.30

Woori Bank and Woori Private Equity Asset Management Co., Ltd. (*5)

Woori-Q Corporate Restructuring Private Equity Fund

Trust and collective investment 37.8 38.4 Korea 2021.6.30

Woori Bank, Woori Financial Capital Co., Ltd., Woori Investment Bank Co., Ltd. and Woori Private Equity Asset Management Co., Ltd. (*5)

Woori-Shinyoung Growth-Cap Private Equity Fund I

Other financial services 35.0 35.0 Korea 2021.6.30
(*1)

Most of the significant business transactions of associates are with the Group as of June 30, 2021 and December 31, 2020.

(*2)

The Group can participate in decision-making body and exercise significant influence over financial policies and operational policies decision making of the associates.

(*3)

There is no investment balance as of June 30, 2021 and December 31, 2020.

(*4)

The equity method was applied using the most recent financial statements available from the settlement date because no financial statements were available at the end of December and the significant transactions or events that occurred between the end of the reporting period of the associate and the end of the reporting period of the subsidiary were duly reflected.

(*5)

Two or more subsidiaries may invest or operate to exert significant influence on the decision-making process for activities related to the investee.

(*6)

The Group can participate as a co-operator to exert significant influence.

(*7)

It has been reclassified as a subsidiary from an associate due to an increase in ownership interest.

(*8)

Woori G IPO10 [FI_Bal][F]C(F) can exercise significant influence but was classified as an item measured at fair value through profit or loss.

- 74 -

(2)

Changes in the carrying value of investments in associates accounted for using the equity method of accounting are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Acquisition
cost 		January 1,
2021 		Share of
profits
(losses) 		Acquisi-
tion 		Disposal/
Reclassification 		Dividends Change
in
capital 		June 30,
2021

W Service Networks Co., Ltd.

108 191 (21 ) - - (4 ) - 166

Korea Credit Bureau Co., Ltd.

3,313 8,125 458 - - (90 ) - 8,493

Korea Finance Security Co., Ltd.

3,267 3,066 (56 ) - - - - 3,010

Woori Growth Partnerships New Technology Private Equity Fund

16,371 15,032 (614 ) - (567 ) - (7 ) 13,844

2016KIF-IMM Woori Bank Technology Venture Fund

11,060 13,238 (182 ) - (833 ) - - 12,223

K BANK Co., Ltd.

236,232 174,097 (8,332 ) - - - (1,772 ) 163,993

Smart Private Equity Fund No. 2

- 1,481 (796 ) - (685 ) - - -

Woori Bank-Company K Korea Movie Asset Fund

600 2,788 86 - (1,500 ) - - 1,374

Partner One Value Up I Private Equity Fund

10,000 9,816 (76 ) - - - (16 ) 9,724

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

14,236 9,756 - 5,040 (560 ) - - 14,236

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

4,192 4,129 - 63 - - - 4,192

LOTTE CARD Co., Ltd

346,810 422,832 12,826 - - (10,374 ) 3,248 428,532

Together-Korea Government Private Pool Private Securities Investment Trust No. 3

10,000 10,023 18 - - - - 10,041

Genesis Environmental Energy Company 1st Private Equity Fund

3,738 3,979 28 - - - - 4,007

Union Technology Finance Investment Association

10,500 4,485 (175 ) 6,000 - - - 10,310

Japanese Hotel Real Estate Private Equity Fund 2

3,291 3,234 76 - - (104 ) (98 ) 3,108

Woori G Clean Energy No. 1

2,477 1,024 138 1,462 - - - 2,624

Woori Goseong Power EBL Private Special Asset Fund

14,915 15,118 245 - - (246 ) - 15,117

Woori Seoul Beltway Private Special Asset Fund

6,273 5,613 54 831 - (48 ) - 6,450

Woori Corporate Private Securities Fund 1 (Bond)

10,000 - (27 ) 10,000 - - - 9,973

Woori G Star Private Placement Investment Trust No. 33 [FI]

20,000 - 63 20,000 - - - 20,063

Woori Multi Return Private Securities Investment Trust 3 (Balanced Bond)

10,000 - (28 ) 10,000 - - - 9,972

Woori Short-term Bond Securities Investment Trust (Bond) Class C-F

50,000 - 444 50,000 - - - 50,444

AJU TAERIM 1st Fund

1,100 283 (11 ) - - - - 272

Portone-Cape Fund No. 1

340 960 189 - (660 ) - - 489

KIWOOM PE AJU Investment Fund

1,000 994 (10 ) - - - - 984

Woori FirstValue Private Real Estate Fund No. 2

9,000 2,130 (637 ) - - - - 1,493

- 75 -

For the six-month period ended June 30, 2021
Acquisition
cost 		January 1,
2021 		Share of
profits
(losses) 		Acquisi-
tion 		Disposal/
Reclassification 		Dividends Change
in
capital 		June 30,
2021

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

6,000 6,076 (29 ) - - - - 6,047

Woori Star50 Master Fund Class C-F

- 184 35 - (219 ) - - -

Uri Hanhwa Eureka Private Equity Fund

350 403 (2 ) - - - - 401

Aarden Woori Apparel 1st Private Equity Fund

100 - - 100 - - - 100

Godo Kaisha Oceanos 1

10,800 10,193 (2 ) - - (370 ) (32 ) 9,789

Force TEC Co., Ltd.

- 393 (393 ) - - - - -

KUM HWA Co., Ltd.

- - 1 - - - - 1

JC Assurance No. 2 Private Equity Fund

29,349 29,050 (370 ) 299 - - - 28,979

Dream Company Growth no. 1 PEF

8,000 7,705 234 - - - - 7,939

HMS-Oriens 1st Fund

12,000 12,000 250 - - - - 12,250

Woori G Senior Loan No. 1

64,950 52,045 1,289 12,991 - (562 ) - 65,763

Genesis Eco No. 1 Private Equity Fund

10,704 - (683 ) 10,704 - - - 10,021

PARATUSWOORI MATERIALS PARTS EQUIPMENT PRIVATE EQUITY FUND

16,400 - (2 ) 16,400 - - - 16,398

PCC-Woori LP Secondary Fund

10,100 8,128 160 2,525 - - - 10,813

Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1

110,221 93,474 490 20,000 - (2,503 ) - 111,461

Woori-Q Corporate Restructuring Private Equity Fund

20,148 22,904 1,068 - (2,996 ) - - 20,976

Woori-Shinyoung Growth-Cap Private Equity Fund I

41,622 38,342 20,537 10,420 - - (96 ) 69,202
1,139,567 993,291 26,241 176,835 (8,020 ) (14,301 ) 1,227 1,175,274

- 76 -

For the six-month period ended June 30, 2020
Acquisition
cost 		January 1,
2020 		Share of
profits
(losses) 		Acquisi-
tion 		Disposal/
Reclassification 		Dividends Change
in
capital 		June 30,
2020

W Service Networks Co., Ltd.

108 186 (19 ) - - (3 ) - 164

Korea Credit Bureau Co., Ltd.

3,313 6,845 743 - - (90 ) - 7,498

Korea Finance Security Co., Ltd.

3,267 3,287 (83 ) - - - - 3,204

Saman Corporation

8,521 849 (418 ) - - - 37 468

Woori Growth Partnerships New Technology Private Equity Fund

18,666 19,212 (2,064 ) - - - - 17,148

2016KIF-IMM Woori Bank Technology Venture Fund

12,385 15,141 1,176 - - - (1,563 ) 14,754

K BANK Co., Ltd.

73,150 31,254 (6,917 ) - - - 21 24,358

Smart Private Equity Fund No. 2

2,915 2,764 (21 ) - - - - 2,743

Woori Bank-Company K Korea Movie Asset Fund

2,100 3,323 315 - (900 ) - - 2,738

Well to Sea No. 3 Private Equity Fund

101,483 209,023 16,385 - - (24,393 ) (1,085 ) 199,930

Partner One Value Up I Private Equity Fund

10,000 9,908 (41 ) - - - - 9,867

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

6,596 4,576 - 2,020 - - - 6,596

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

4,055 4,375 - - (321 ) - - 4,054

LOTTE CARD Co., Ltd

346,810 409,444 13,822 810 - (5,710 ) (3,343 ) 415,023

Together-Korea Government Private Pool Private Securities Investment Trust No. 3

100,000 - 80 100,000 - - - 100,080

Japanese Hotel Real Estate Private Equity Fund 2

3,291 3,291 188 - - (56 ) - 3,423

Woori All-in-One World EMP 40 [Bond Mixed-FOF]

5,000 - (107 ) 5,000 - - - 4,893

Uri Hanhwa Eureka Private Equity Fund

350 342 (2 ) - - - - 340

Godo Kaisha Oceanos 1

10,800 10,952 209 - - (689 ) 20 10,492

Force TEC Co., Ltd.

- - 1,563 - - - (442 ) 1,121

Woori-Shinyoung Growth-Cap Private Equity Fund I

32,572 11,841 (61 ) 19,906 - - - 31,686

Chin Hung International Inc.

130,779 51,176 (726 ) - - - (22 ) 50,428

PCC-Woori LP Secondary Fund

5,050 2,525 (124 ) 2,525 - - - 4,926

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

6,141 - 120 6,141 - - - 6,261

Woori-Q Corporate Restructuring Private Equity Fund

6,129 6,046 (80 ) - - - - 5,966
893,481 806,360 23,938 136,402 (1,221 ) (30,941 ) (6,377 ) 928,161

- 77 -

(3)

Summary financial information relating to investments in associates accounted for using the equity method of accounting is as follows (Unit: Korean Won in millions):

June 30, 2021
Assets Liabilities Operating
revenue 		Net income
(loss) 		Other
comprehensive
income(loss) 		Total
comprehensive
income(loss)

W Service Networks Co., Ltd.

5,860 2,497 7,874 499 - 499

Korea Credit Bureau Co., Ltd.

122,167 38,981 60,698 11,097 - 11,097

Korea Finance Security Co., Ltd.

33,906 13,840 27,036 (356 ) - (356 )

Woori Growth Partnerships New Technology Private Equity Fund

60,229 240 1,354 (2,190 ) - (2,190 )

2016KIF-IMM Woori Bank Technology Venture Fund

58,421 583 15 (665 ) - (665 )

K BANK Co., Ltd.

13,851,753 13,380,340 84,541 (10,414 ) (6,943 ) (17,357 )

Woori Bank-Company K Korea Movie Asset Fund

5,532 35 375 339 - 339

Partner One Value Up I Private Equity Fund

41,807 - 3 (323 ) - (323 )

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

70,554 649 2,312 1,617 - 1,617

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

15,762 - - (114 ) - (114 )

LOTTE CARD Co., Ltd (*)

14,705,638 12,336,183 492,964 49,836 9,171 59,007

Together-Korea Government Private Pool Private Securities Investment Trust No. 3

10,044 1 10 8 - 8

Genesis Environmental Energy Company 1st Private Equity Fund

20,601 4,411 3,375 199 - 199

Union Technology Finance Investment Association

35,002 290 6 (587 ) - (587 )

Japanese Hotel Real Estate Private Equity Fund 2

15,659 14 431 382 (1,434 ) (1,052 )

Woori G Clean Energy No. 1

8,972 19 488 470 - 470

Woori Goseong Power EBL Private Special Asset Fund

90,721 21 1,517 1,472 - 1,472

Woori Seoul Beltway Private Special Asset Fund

25,802 1 234 217 - 217

Woori Corporate Private Securities Fund 1 (Bond)

49,891 42 13 13 - 13

Woori G Star Private Placement Investment Trust No. 33 [FI]

126,585 28 472 399 - 399

Woori Multi Return Private Securities Investment Trust 3(Balanced Bond)

135,992 86,130 29 27 - 27

Woori Short-term Bond Securities Investment Trust (Bond) Class C-F

1,608,203 125,716 110 107 - 107

AJU TAERIM 1st Fund

1,192 129 - (43 ) - (43 )

Portone-Cape Fund No. 1

2,447 - 1,050 947 - 947

KIWOOM PE AJU Investment Fund

10,929 109 - (109 ) - (109 )

Woori FirstValue Private Real Estate Fund No. 2

14,918 2,471 - - - -

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

22,278 - 7 7 - 7

Uri Hanhwa Eureka Private Equity Fund

50,159 232 20 (220 ) - (220 )

Aarden Woori Apparel 1st Private Equity Fund

21,200 27 - (27 ) - (27 )

Godo Kaisha Oceanos 1

66,038 45,562 1,497 (3 ) - (3 )

Force TEC Co., Ltd.

29,045 37,358 7,239 1,056 - 1,056

KUM HWA Co., Ltd.

34 175 25 5 - 5

JC Assurance No. 2 Private Equity Fund

98,921 15 - (533 ) - (533 )

Dream Company Growth no. 1 PEF

30,327 1,744 - 1,594 - 1,594

HMS-Oriens 1st Fund

53,702 6 1,364 1,065 - 1,065

Woori G Senior Loan No. 1

303,775 16 6,342 5,953 - 5,953

Genesis Eco No. 1 Private Equity Fund

34,574 - - 367 - 367

PARATUSWOORI MATERIALS PARTS EQUIPMENT PRIVATE EQUITY FUND

54,900 7 - (7 ) - (7 )

PCC-Woori LP Secondary Fund

27,842 4 750 415 - 415

Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1

426,689 - 1,850 1,850 - 1,850

Woori-Q Corporate Restructuring Private Equity Fund

55,986 439 280 (693 ) - (693 )

Woori-Shinyoung Growth-Cap Private Equity Fund I

198,494 602 81,046 80,193 - 80,193
(*)

The amount is after reflecting the fair value adjustment that occurred when acquiring the shares and the adjustments that occurred by difference of accounting policies with the Group.

- 78 -

December 31, 2020
Assets Liabilities Operating
revenue 		Net income
(loss) 		Other
comprehensive
income(loss) 		Total
comprehensive
income(loss)

W Service Networks Co., Ltd.

6,305 2,448 18,525 1,197 - 1,197

Korea Credit Bureau Co., Ltd.

117,077 37,599 107,810 13,391 - 13,391

Korea Finance Security Co., Ltd.

36,978 16,536 60,599 (1,985 ) - (1,985 )

Woori Growth Partnerships New Technology Private Equity Fund

65,390 252 1,589 (9,601 ) - (9,601 )

2016KIF-IMM Woori Bank Technology Venture Fund

64,109 1,198 7,425 6,201 - 6,201

K BANK Co., Ltd.

4,040,051 3,530,074 68,144 (83,989 ) (1,354 ) (85,343 )

Smart Private Equity Fund No. 2

13,667 51 1 (204 ) - (204 )

Woori Bank-Company K Korea Movie Asset Fund

11,273 119 1,926 1,461 - 1,461

Well to Sea No. 3 Private Equity Fund

22,001 3,102 610,535 16,061 3,976 20,037

Partner One Value Up I Private Equity Fund

42,205 - 308 (329 ) - (329 )

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

46,542 655 1,024 (411 ) - (411 )

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

15,747 - 284 (85 ) - (85 )

LOTTE CARD Co., Ltd (*)

14,578,716 12,238,805 1,255,593 78,781 (9,040 ) 69,741

Together-Korea Government Private Pool Private Securities Investment Trust No. 3

10,025 1 187 23 - 23

Genesis Environmental Energy Company 1st Private Equity Fund

16,192 118 1,400 974 - 974

Union Technology Finance Investment Association

15,151 51 1 (50 ) - (50 )

Japanese Hotel Real Estate Private Equity Fund 2

16,293 15 1,359 1,271 (940 ) 331

Woori G Clean Energy No. 1

3,496 1 33 32 - 32

Woori Goseong Power EBL Private Special Asset Fund

90,728 21 3,060 2,969 - 2,969

Woori Seoul Beltway Private Special Asset Fund

22,452 1 352 323 - 323

AJU TAERIM 1st Fund

1,192 86 - (22 ) - (22 )

Portone-Cape Fund No. 1

4,800 - - - - -

KIWOOM PE AJU Investment Fund

10,986 57 - (71 ) - (71 )

Woori FirstValue Private Real Estate Fund No. 2

20,220 2,467 9 (9 ) - (9 )

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

27,870 - 148 148 - 148

Woori Star50 Master Fund Class C-F

1,011 246 11 11 - 11

Uri Hanhwa Eureka Private Equity Fund

50,382 235 8,150 7,676 - 7,676

Godo Kaisha Oceanos 1

66,793 45,472 1,425 14 - 14

Force TEC Co., Ltd.

47,077 45,552 25,914 (415 ) (2,745 ) (3,160 )

JC Assurance No. 2 Private Equity Fund

98,431 13 - (732 ) - (732 )

Dream Company Growth no. 1 PEF

28,727 43 - (116 ) - (116 )

HMS-Oriens 1st Fund

52,685 53 90 20 - 20

Woori G Senior Loan No. 1

240,414 15 1,721 1,584 - 1,584

PCC-Woori LP Secondary Fund

20,927 4 2,082 1,425 - 1,425

Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1

402,015 - 10,727 10,727 - 10,727

Woori-Q Corporate Restructuring Private Equity Fund

58,355 433 206 (1,590 ) - (1,590 )

Woori-Shinyoung Growth-Cap Private Equity Fund I

110,452 825 23,875 21,106 - 21,106
(*)

The amount is after reflecting the fair value adjustment that occurred when acquiring the shares and the adjustments that occurred by difference of accounting policies with the Group.

- 79 -

(4)

The entities that the Group has not applied equity method of accounting although the Group's ownership interest is more than 20% as of June 30, 2021 and December 31, 2020 are as follows:

June 30, 2021

Associate (*)

Number of
shares owned 		Ownership (%)

Orient Shipyard Co., Ltd.

464,812 21.4

Yuil PESC Co., Ltd.

8,642 24.0

CL Tech Co., Ltd.

13,759 38.6
(*)

Even though the Group's ownership interest of the entity is more than 20%, the Group does not have significant influence over the entity since it is going through work-out process under receivership, thus it is excluded from the investment in joint ventures and associates.

December 31, 2020

Associate (*)

Number of
shares owned 		Ownership (%)

Orient Shipyard Co., Ltd.

464,812 21.4

Yuil PESC Co., Ltd.

8,642 24.0

CL Tech Co., Ltd.

13,759 38.6
(*)

Even though the Group's ownership interest of the entity is more than 20%, the Group does not have significant influence over the entity since it is going through work-out process under receivership, thus it is excluded from the investment in joint ventures and associates.

(5)

As of June 30, 2021 and December 31, 2020, the reconciliations from the net assets of the associates to the book value of the shares of the investment in joint ventures and associates are as follows (Unit: Korean Won in millions except for ownership):

June 30, 2021
Total net
asset 		Ownership
(%) 		Ownership
portion of net
assets 		Basis
difference 		Impairment Intercompany
transaction 		Book
value

W Service Networks Co., Ltd.

3,363 4.9 166 - - - 166

Korea Credit Bureau Co., Ltd.

83,186 9.9 8,244 246 - 3 8,493

Korea Finance Security Co., Ltd.

20,066 15.0 3,010 - - - 3,010

Woori Growth Partnerships New Technology Private Equity Fund

59,989 23.1 13,846 - - (2 ) 13,844

2016KIF-IMM Woori Bank Technology Venture Fund

57,838 20.0 11,568 - - 655 12,223

K BANK Co., Ltd. (*1) (*2)

471,412 26.2 123,510 44,117 (3,634 ) - 163,993

Woori Bank-Company K Korea Movie Asset Fund

5,497 25.0 1,374 - - - 1,374

Partner One Value Up Ist Private Equity Fund

41,807 23.3 9,724 - - - 9,724

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

69,905 20.0 13,981 - - 255 14,236

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

15,762 25.0 3,940 - - 252 4,192

LOTTE CARD Co., Ltd (*1)

2,142,659 20.0 428,532 - - - 428,532

Together-Korea Government Private Pool Private Securities Investment Trust No. 3

10,043 100.0 10,043 - - (2 ) 10,041

Genesis Environmental Energy Company 1st Private Equity Fund

16,190 24.8 4,007 - - - 4,007

Union Technology Finance Investment Association

34,712 29.7 10,309 - - 1 10,310

Japanese Hotel Real Estate Private Equity Fund 2

15,645 19.9 3,108 - - - 3,108

Woori G Clean Energy No. 1

8,953 29.3 2,624 - - - 2,624

- 80 -

June 30, 2021
Total net
asset 		Ownership
(%) 		Ownership
portion of net
assets 		Basis
difference 		Impairment Intercompany
transaction 		Book
value

Woori Goseong Power EBL Private Special Asset Fund

90,700 16.7 15,117 - - - 15,117

Woori Seoul Beltway Private Special Asset Fund

25,801 25.0 6,450 - - - 6,450

Woori Corporate Private Securities Fund 1 (Bond)

49,849 20.0 9,973 - - - 9,973

Woori G Star Private Placement Investment Trust No. 33 [FI]

126,557 15.8 20,063 - - - 20,063

Woori Multi Return Private Securities Investment Trust 3(Balanced Bond)

49,862 20.0 9,972 - - - 9,972

Woori Short-term Bond Securities Investment Trust (Bond) Class C-F

1,482,487 3.4 50,444 - - - 50,444

AJU TAERIM 1st Fund

1,063 25.6 272 - - - 272

Portone-Cape Fund No. 1

2,447 20.0 489 - - - 489

KIWOOM PE AJU Investment Fund

10,820 9.1 984 - - - 984

Woori FirstValue Private Real Estate Fund No. 2

12,447 12.0 1,493 - - - 1,493

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

22,278 27.2 6,047 - - - 6,047

Uri Hanhwa Eureka Private Equity Fund

49,927 0.8 401 - - - 401

Aarden Woori Apparel 1st Private Equity Fund

21,173 0.5 100 - - - 100

Godo Kaisha Oceanos 1

20,476 47.8 9,789 - - - 9,789

Force TEC

(8,313 ) 24.5 (2,040 ) - - 2,040 -

KUM HWA Co., Ltd.

(141 ) 20.1 (28 ) - - 29 1

JC Assurance No. 2 Private Equity Fund

98,906 29.3 28,979 - - - 28,979

Dream Company Growth no. 1 PEF

28,583 27.8 7,939 - - - 7,939

HMS-Oriens 1st Fund

53,696 22.8 12,250 - - - 12,250

Woori G Senior Loan No. 1

303,759 21.7 65,763 - - - 65,763

Genesis Eco No. 1 Private Equity Fund

34,574 29.0 10,021 - - - 10,021

PARATUSWOORI MATERIALS PARTS EQUIPMENT PRIVATE EQUITY FUND

54,893 29.9 16,398 - - - 16,398

PCC-Woori LP Secondary Fund

27,837 38.8 10,812 - - 1 10,813

Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1

426,689 26.5 111,461 - - - 111,461

Woori-Q Corporate Restructuring Private Equity Fund

55,547 37.8 20,976 - - - 20,976

Woori-Shinyoung Growth-Cap Private Equity Fund I

197,892 35.0 69,202 - - - 69,202
(*1)

The net asset equity amount is after the debt-for-equity swap, non-controlling etc.

(*2)

As a result of conducting an impairment test on the investment stocks of the related companies, the recoverable value was less than the carrying amount and thus the impairment loss was recognized.

- 81 -

December 31, 2020
Total net
asset 		Ownership
(%) 		Ownership
portion of net
assets 		Basis
difference 		Impairment Intercompany
transaction 		Book
value

W Service Networks Co., Ltd.

3,857 4.9 191 - - - 191

Korea Credit Bureau Co., Ltd.

79,478 9.9 7,876 246 - 3 8,125

Korea Finance Security Co., Ltd.

20,442 15.0 3,066 - - - 3,066

Woori Growth Partnerships New Technology Private Equity Fund

65,138 23.1 15,034 - - (2 ) 15,032

2016KIF-IMM Woori Bank Technology Venture Fund

62,911 20.0 12,582 - - 656 13,238

K BANK Co., Ltd. (*1) (*2)

509,978 26.2 133,614 44,117 (3,634 ) - 174,097

Smart Private Equity Fund No. 2 (*2)

13,616 20.0 2,723 - (1,242 ) - 1,481

Woori Bank-Company K Korea Movie Asset Fund

11,154 25.0 2,788 - - - 2,788

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

18,899 50.0 - - - - -

Partner One Value Up Ist Private Equity Fund

42,205 23.3 9,817 - - (1 ) 9,816

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

45,888 20.0 9,178 - - 578 9,756

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

15,747 25.0 3,937 - - 192 4,129

LOTTE CARD Co., Ltd (*1)

2,114,159 20.0 422,832 - - - 422,832

Together-Korea Government Private Pool Private Securities Investment Trust No. 3

10,024 100.0 10,024 - - (1 ) 10,023

Genesis Environmental Energy Company 1st Private Equity Fund

16,074 24.8 3,979 - - - 3,979

Union Technology Finance Investment Association

15,100 29.7 4,485 - - - 4,485

Japanese Hotel Real Estate Private Equity Fund 2

16,278 19.9 3,234 - - - 3,234

Woori G Clean Energy No. 1

3,495 29.3 1,024 - - - 1,024

Woori Goseong Power EBL Private Special Asset Fund

90,707 16.7 15,118 - - - 15,118

Woori Seoul Beltway Private Special Asset Fund

22,451 25.0 5,613 - - - 5,613

AJU TAERIM 1st Fund

1,106 25.6 283 - - - 283

Portone-Cape Fund No. 1

4,800 20.0 960 - - - 960

KIWOOM PE AJU Investment Fund

10,929 9.1 994 - - - 994

Woori FirstValue Private Real Estate Fund No. 2

17,753 12.0 2,130 - - - 2,130

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

27,870 21.8 6,076 - - - 6,076

Woori Star50 Master Fund Class C-F

765 24.5 184 - - - 184

Uri Hanhwa Eureka Private Equity Fund

50,147 0.8 403 - - - 403

Godo Kaisha Oceanos 1

21,321 47.8 10,193 - - - 10,193

Force TEC

1,526 25.8 393 - - - 393

JC Assurance No. 2 Private Equity Fund

98,418 29.3 29,050 - - - 29,050

Dream Company Growth no. 1 PEF

28,684 27.8 7,705 - - - 7,705

HMS-Oriens 1st Fund

52,632 22.8 12,000 - - - 12,000

Woori G Senior Loan No. 1

240,399 21.7 52,045 - - - 52,045

PCC-Woori LP Secondary Fund

20,923 38.8 8,126 - - 2 8,128

- 82 -

December 31, 2020
Total net
asset 		Ownership
(%) 		Ownership
portion of net
assets 		Basis
difference 		Impairment Intercompany
transaction 		Book
value

Woori High Plus Short-term High Graded ESG Bond Sec Feeder Inv Trust 1

402,015 23.3 93,474 - - - 93,474

Woori-Q Corporate Restructuring Private Equity Fund

57,922 38.4 22,220 - - 684 22,904

Woori-Shinyoung Growth-Cap Private Equity Fund I

109,627 35.0 38,342 - - - 38,342
(*1)

The net asset equity amount is after the debt-for-equity swap, non-controlling etc.

(*2)

As a result of conducting an impairment test on the investment stocks of the related companies, the recoverable value was less than the carrying amount and thus the impairment loss was recognized.

(*3)

The estimated recoverable amount of 15,687 million Won at the time of liquidation was classified as receivable.

13.

INVESTMENT PROPERTIES

(1)

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

June 30, 2021 December 31, 2020

Acquisition cost

410,586 409,702

Accumulated depreciation

(23,850 ) (22,152 )

Accumulated impairment losses

(86 ) (86 )

Net carrying value

386,650 387,464
(2)

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

For the six-month period ended June 30
2021 2020

Beginning balance

387,464 280,239

Acquisition

- 1,514

Disposal

- (354 )

Depreciation

(1,411 ) (1,087 )

Transfer

2,497 31,681

Foreign currencies translation adjustments

(1,954 ) 430

Others

54 383

Ending balance

386,650 312,806

- 83 -

14.

PREMISES AND EQUIPMENT

(1)

Details of premises and equipment as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021
Land Building Equipment
and vehicles 		Leasehold
improvement 		Construction
in progress 		Structures Total

Premises and equipment (owned)

1,725,871 771,429 240,710 46,782 15,002 1 2,799,795

Right-of-use asset


-

377,388 13,011 - - - 390,399

Carrying value

1,725,871 1,148,817 253,721 46,782 15,002 1 3,190,194
December 31, 2020
Land Building Equipment
and vehicles 		Leasehold
improvement 		Construction
in progress 		Structures Total

Premises and equipment (owned)

1,726,045 787,040 268,225 50,085 8,246 2 2,839,643

Right-of-use asset

- 435,132 12,423 - - - 447,555

Carrying value

1,726,045 1,222,172 280,648 50,085 8,246 2 3,287,198
(2)

Details of premises and equipment (owned) as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021
Land Building Equipment
and vehicles 		Leasehold
improvement 		Construction
in progress 		Structures Total

Acquisition cost

1,726,531 1,076,347 1,126,536 467,066 15,002 20 4,411,502

Accumulated depreciation

- (304,918 ) (885,826 ) (420,284 ) - (19 ) (1,611,047 )

Accumulated impairment losses

(660 ) - - - - - (660 )

Net carrying value

1,725,871 771,429 240,710 46,782 15,002 1 2,799,795
December 31, 2020
Land Building Equipment
and vehicles 		Leasehold
improvement 		Construction
in progress 		Structures Total

Acquisition cost

1,726,705 1,076,647 1,142,653 478,290 8,246 20 4,432,561

Accumulated depreciation

- (289,607 ) (874,428 ) (428,205 ) - (18 ) (1,592,258 )

Accumulated impairment losses

(660 ) - - - - - (660 )

Net carrying value

1,726,045 787,040 268,225 50,085 8,246 2 2,839,643

- 84 -

(3)

Details of changes in premises and equipment (owned) are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Land Building Equipment
and vehicles 		Leasehold
improvement 		Construction
in progress 		Structures Total

Beginning balance

1,726,045 787,040 268,225 50,085 8,246 2 2,839,643

Acquisitions

- 5,583 18,651 7,898 7,909 - 40,041

Disposals

- (7 ) (534 ) (767 ) - - (1,308 )

Depreciation

- (16,926 ) (46,511 ) (10,636 ) - (1 ) (74,074 )

Classified as held-for-sale

(759 ) (1,412 ) - - - - (2,171 )

Transfer

(2,558 ) 61 191 - (191 ) - (2,497 )

Foreign currencies translation adjustments

113 125 984 630 33 - 1,885

Others

3,030 (3,035 ) (296 ) (428 ) (995 ) - (1,724 )

Ending balance

1,725,871 771,429 240,710 46,782 15,002 1 2,799,795
For the six-month period ended June 30, 2020
Land Building Equipment
and vehicles 		Leasehold
improvement 		Construction
in progress 		Structures Total

Beginning balance

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

Acquisitions

55 9,068 37,525 10,528 90 - 57,266

Disposals

(6,422 ) (332 ) (804 ) (304 ) - - (7,862 )

Depreciation

- (17,708 ) (46,975 ) (13,822 ) - - (78,505 )

Transfer

(30,518 ) (1,163 ) - - - - (31,681 )

Foreign currencies translation adjustments

207 178 1,529 583 25 - 2,522

Others

- (3,638 ) 984 1,236 (539 ) - (1,957 )

Ending balance

1,724,481 788,704 270,275 53,060 863 2 2,837,385
(4)

Details of right-of-use assets as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021
Building Equipment and vehicles Total

Acquisition cost

687,241 29,248 716,489

Accumulated depreciation

(309,853 ) (16,237 ) (326,090 )

Net carrying value

377,388 13,011 390,399
December 31, 2020
Building Equipment and vehicles Total

Acquisition cost

720,417 28,463 748,880

Accumulated depreciation

(285,285 ) (16,040 ) (301,325 )

Net carrying value

435,132 12,423 447,555

- 85 -

(5)

Details of changes in right-of-use assets for the six-month periods ended June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Building Equipment and vehicles Total

Beginning balance

435,132 12,423 447,555

New contracts

79,493 6,969 86,462

Changes in contract

1,385 - 1,385

Termination

(36,763 ) (793 ) (37,556 )

Depreciation

(117,665 ) (5,396 ) (123,061 )

Others

15,806 (192 ) 15,614

Ending balance

377,388 13,011 390,399
For the six-month period ended June 30, 2020
Building Equipment and vehicles Total

Beginning balance

449,878 17,236 467,114

New contracts

111,610 3,158 114,768

Changes in contract

5,922 13 5,935

Termination

(3,020 ) (282 ) (3,302 )

Depreciation

(114,536 ) (5,026 ) (119,562 )

Others

8,598 73 8,671

Ending balance

458,452 15,172 473,624
15.

INTANGIBLE ASSETS

(1)

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

June 30, 2021
Goodwill Industrial
property
rights 		Development
cost 		Other
intangible
assets 		Membership
deposit 		Construction
in
progress 		Total

Acquisition cost

336,980 1,810 620,549 1,139,462 40,161 740 2,139,702

Accumulated amortization

- (1,212 ) (414,315 ) (911,497 ) - - (1,327,024 )

Accumulated impairment losses

- - - (33,552 ) (3,512 ) - (37,064 )

Net carrying value

336,980 598 206,234 194,413 36,649 740 775,614
December 31, 2020
Goodwill Industrial
property
rights 		Development
cost 		Other
intangible
assets 		Membership
deposit 		Construction
in
progress 		Total

Acquisition cost

334,290 1,810 582,998 1,114,615 39,454 6,669 2,079,836

Accumulated amortization

- (1,101 ) (374,125 ) (875,636 ) - - (1,250,862 )

Accumulated impairment losses

- - - (33,534 ) (3,363 ) - (36,897 )

Net carrying value

334,290 709 208,873 205,445 36,091 6,669 792,077

- 86 -

(2)

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

For the six-month period ended June 30, 2021
Goodwill Industrial
property
rights 		Development
cost 		Other
intangible
assets 		Membership
deposit 		Construction
in
progress 		Total

Beginning balance

334,290 709 208,873 205,445 36,091 6,669 792,077

Acquisitions

- - 33,807 18,253 1,097 237 53,394

Disposal

- - - (9 ) (316 ) - (325 )

Amortization (*)

- (111 ) (40,196 ) (33,871 ) - - (74,178 )

Impairment losses

- - - (18 ) (116 ) - (134 )

Transfer

- - 3,749 2,920 - (6,669 ) -

Foreign currencies translation adjustments

3,193 - - 878 92 - 4,163

Others

(503 ) - 1 815 (199 ) 503 617

Ending balance

336,980 598 206,234 194,413 36,649 740 775,614
(*)

Amortization of other intangible assets amounting to 6,808 million Won is included in other operating expenses.

For the six-month period ended June 30, 2020
Goodwill Industrial
property
rights 		Development
cost 		Other
intangible
assets 		Membership
deposit 		Construction
in
progress 		Total

Beginning balance

350,682 692 225,193 234,147 29,330 4,066 844,110

Acquisitions

- 123 27,060 15,124 3,903 273 46,483

Disposal

- - - - (300 ) - (300 )

Amortization (*)

- (104 ) (34,872 ) (32,706 ) - - (67,682 )

Impairment losses

- - - (7,687 ) - - (7,687 )

Transfer

- - 428 - - (428 ) -

Foreign currencies translation adjustments

5,348 - - 891 63 (3 ) 6,299

Others

(1,626 ) - - 828 (45 ) - (843 )

Ending balance

354,404 711 217,809 210,597 32,951 3,908 820,380
(*)

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

16.

ASSETS HELD FOR SALE

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

Assets (*)

June 30, 2021 December 31, 2020

Premises and equipment

1,507 2,130

Investments of associates

27,389 50,411

Others

6,599 7,461

Total

35,495 60,002
(*)

The Group classifies assets as held for sale that are highly likely to be sold within one year from June 30, 2021 and December 31, 2020.

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

- 87 -

17.

OTHER ASSETS

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

June 30, 2021 December 31, 2020

Lease assets

1,309,466 1,116,175

Prepaid expenses

202,771 170,820

Advance payments

80,337 28,256

Assets for non-business use

11,797 12,135

Others

64,242 21,608

Total

1,668,613 1,348,994
18.

FINANCIAL LIABILITIES AT FVTPL

(1)

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

June 30, 2021 December 31, 2020

Financial instruments at fair value through profit or loss measured at fair value

3,928,181 6,794,192

Financial liabilities at fair value through profit or loss designated as upon initial recognition

- 19,630

Total

3,928,181 6,813,822
(2)

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

June 30, 2021 December 31, 2020

Deposits

Gold banking liabilities

70,394 49,279

Borrowings

Securities sold

200,083 285,026

Derivative liabilities

3,657,704 6,459,887

Total

3,928,181 6,794,192
(3)

Financial liabilities at fair value through profit or loss designated as upon initial recognition as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Equity-linked securities

Equity-linked securities in short position

- 19,630

The Group designated the financial liability at a fair value through profit or loss since the financial liability is a compound contract that includes one or more embedded derivatives which IFRS 1109 'Financial Instruments' allows designation of fair value through profit or loss.

(4)

There are no accumulated changes in credit risk adjustments to financial liabilities at fair value through profit or loss designated as upon initial recognition.

The adjustment to reflect the Group's credit risk is considered in measuring the fair value of equity-linked securities index. The Group's credit risk is determined by adjusting credit spread observed in credit rating of the Group.

- 88 -

(5)

The difference between carrying amount and maturity amount of financial liabilities at fair value through profit or loss designated as upon initial recognition (Financial liabilities designated as at FVTPL) are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Carrying amount

- 19,630

Nominal amount at maturity

- 25,780

Difference

- (6,150 )
19.

DEPOSITS DUE TO CUSTOMERS

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

June 30, 2021 December 31, 2020

Deposits in local currency

Deposits on demand

15,488,268 12,454,024

Deposits at termination

246,597,694 242,397,664

Mutual installment

25,255 26,319

Deposits on notes payables

2,853,778 2,647,492

Deposits on CMA

109,792 110,413

Certificate of deposits

2,917,776 2,072,389

Other deposits

1,333,476 1,372,461

Sub-total

269,326,039 261,080,762

Deposits in foreign currencies

Deposits in foreign currencies

33,178,205 30,408,762

Present value discount

(11,568 ) (12,245 )

Total

302,492,676 291,477,279
20.

BORROWINGS AND DEBENTURES

(1)

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

June 30, 2021

Lenders

Interest rate (%) Amount

Borrowings in local currency

Borrowings from BOK

BOK 0.3 3,080,866

Borrowings from government funds

Small Enterprise And Market Service and others

0.0 ~ 3.5 2,134,443

Others

The Korea Development Bank and others

0.0 ~ 4.0 8,446,343

Sub-total

13,661,652

Borrowings in foreign currencies

Borrowings in foreign currencies

JPMorgan Chase & Co. and others

(0.5) ~ 7.3 7,755,408

Sub-total

7,755,408

Bills sold

Others 0.0 ~ 0.9 8,530

Call money

Bank and others 0.0 ~ 2.2 274,484

Bonds sold under repurchase agreements

Other financial institutions (0.5) ~ 10.6 856,544

Present value discount

(10,756 )

Total

22,545,862

- 89 -

December 31, 2020

Lenders

Interest rate (%) Amount

Borrowings in local currency

Borrowings from BOK

BOK 0.3 2,678,120

Borrowings from government funds

Small Enterprise And Market Service and others

0.0 ~ 5.0 2,155,129

Others

The Korea Development Bank and others

0.0 ~ 5.5 7,255,938

Sub-total

12,089,187

Borrowings in foreign currencies

Borrowings in foreign currencies

JPMorgan Chase & Co. and others

(0.4) ~ 7.3 7,573,722

Bills sold

Others 0.0 ~ 0.9 8,924

Call money

Bank and others (0.3) ~ 3.8 416,370

Bonds sold under repurchase agreements

Other financial institutions (0.5) ~ 10.6 657,823

Present value discount

(560 )

Total

20,745,466
(2)

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

June 30, 2021 December 31, 2020
Interest rate
(%) 		Amount Interest rate
(%) 		Amount

Face value of bond (*):

Ordinary bonds

0.8 ~ 4.5 33,386,279 0.8 ~ 4.5 29,623,445

Subordinated bonds

1.9 ~ 5.1 6,726,101 1.9 ~ 5.9 6,955,515

Other bonds

0.6 ~ 17.0 835,107 0.6 ~ 17.0 925,677

Sub-total

40,947,487 37,504,637

Discounts on bonds

(29,535 ) (25,279 )

Total

40,917,952 37,479,358
(*)

Included debentures under fair value hedge amounting to 2,862,453 million Won and 2,767,208 million Won as of June 30, 2021 and December 31, 2020 respectively. Also, debentures under cash flow hedge amounting to 792,563 million Won and 857,531 million Won are included as of June 30, 2021 and December 31, 2020 respectively.

- 90 -

21.

PROVISIONS

(1)

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

June 30, 2021 December 31, 2020

Asset retirement obligation

80,976 68,402

Provisions for guarantees (*1)

76,735 89,592

Provisions for unused loan commitments

111,858 122,155

Other provisions (*2)

230,928 221,494

Total

500,497 501,643
(*1)

Provisions for guarantees includes provision for financial guarantee of 59,925 million Won and 66,232 million Won as of June 30, 2021 and December 31, 2020, respectively.

(*2)

Other provisions consist of provision for litigation, loss compensation and others.

(2)

Changes in provisions for guarantees and unused loan commitments are as follows (Unit: Korean Won in millions):

1)

Provisions for guarantees

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

64,804 16,745 8,043 89,592

Transfer to 12-month expected credit loss

2,219 (2,219 ) - -

Transfer to expected credit loss for the entire period

(218 ) 218 - -

Transfer to credit-impaired financial assets

(39 ) - 39 -

Provisions used

(3,155 ) - - (3,155 )

Net provision (reversal) of unused amount

(3,177 ) (6,423 ) 2,003 (7,597 )

Others (*)

(2,109 ) 4 - (2,105 )

Ending balance

58,325 8,325 10,085 76,735
(*)

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

For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

50,801 26,303 15,382 92,486

Transfer to 12-month expected credit loss

120 (120 ) - -

Transfer to expected credit loss for the entire period

(718 ) 1,961 (1,243 ) -

Transfer to credit-impaired financial assets

(40 ) (32 ) 72 -

Net provision (reversal) of unused amount

2,184 (3,807 ) 5,595 3,972

Others (*)

(1,788 ) - - (1,788 )

Ending balance

50,559 24,305 19,806 94,670
(*)

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

- 91 -

2)

Provisions for unused loan commitment

For the six-month period ended June 30, 2021
Stage 1 Stage 2 Stage 3 Total

Beginning balance

63,240 55,726 3,189 122,155

Transfer to 12-month expected credit loss

12,672 (12,348 ) (324 ) -

Transfer to expected credit loss for the entire period

(2,834 ) 3,489 (655 ) -

Transfer to credit-impaired financial assets

(120 ) (299 ) 419 -

Net provision (reversal) of unused amount

(12,007 ) 2,001 (340 ) (10,346 )

Others

49 - - 49

Ending balance

61,000 48,569 2,289 111,858
For the six-month period ended June 30, 2020
Stage 1 Stage 2 Stage 3 Total

Beginning balance

65,038 43,164 4,352 112,554

Transfer to 12-month expected credit loss

5,533 (5,387 ) (146 ) -

Transfer to expected credit loss for the entire period

(1,880 ) 2,374 (494 ) -

Transfer to credit-impaired financial assets

(134 ) (194 ) 328 -

Net provision (reversal) of unused amount

4,336 16,159 (683 ) 19,812

Others

43 - - 43

Ending balance

72,936 56,116 3,357 132,409
(3)

Changes in asset retirement obligation for the six-month periods ended June 30, 2021 and 2020, obligation are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30
2021 2020

Beginning balance

68,402 66,485

Provisions provided

612 2,442

Provisions used

(3,055 ) (548 )

Reversal of provisions unused

(112 ) (94 )

Unwinding of discount

218 234

Increase in recovery cost and others

14,911 -

Ending balance

80,976 68,519

The amount of the asset retirement obligation is the present value of the best estimate of future expected expenditure to settle the obligation - arising from leased premises as of June 30, 2021, discounted by appropriate discount rate. The restoration cost is expected to occur by the end of each premise's lease period, and the Group has used average lease period of each category of leases terminated during the past years in order to rationally estimate the lease period. In addition, the Group used average amount of actual recovery cost for the past 3 years and the inflation rate for last year in order to estimate future recovery cost.

- 92 -

(4)

Changes in other provisions for the six-month periods ended June 30, 2021 and 2020, are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30
2021 2020

Beginning balance

221,494 172,455

Provisions provided

14,651 169,338

Provisions used

(7,899 ) (87,260 )

Reversal of provisions unused

(537 ) (30 )

Foreign currencies translation adjustments

3,113 1,374

Others

106 (86 )

Ending balance

230,928 255,791
(5)

Others

1)

The Group has been offering Korean Won settlement services for trade with Korea and Iran; however, the Group has stopped the services for trade in line with U.S. economic sanctions on September 23, 2019. The Group resumed the service humanitarian goods trade only since July 13, 2020. In connection with these services, the Group is currently being investigated by the U.S. government agencies including the U.S. prosecutors (United States Attorney's Office and New York State Attorney General's Office) and New York State Financial Supervisory Service as to whether the Group has violated United States laws by participating in prohibited transactions involving the following countries: Iran, Sudan, Syria and Cuba, which have been sanctioned by the U.S. In this regard, Office of Foreign Assets Control concluded its investigation in December 2020 without taking any additional sanctions, but the investigation procedures of the U.S. Public Prosecutors' Office and the New York State Financial Supervisory Service have yet to be completed.

2)

The Group recognized the provision of the estimated compensation amount related to the miss-selling of the Derivative Linked Fund (DLF) incurred during 2019 and a fine expected to be imposed by the Financial Supervisory Service as the best estimate for the expenditure required to meet its obligations at the end of the reporting period.

3)

For the six-month period ended June 30, 2021, the Group recognized the provisions for the required expenditure as the best estimate to fulfill its obligations as of June 30, 2021 due to the expected losses of clients arising from the delay in the redemption of funds by Lime Asset Management and the dispute settlement by the Financial Supervisory Service. As of June 30, 2021, the provision for this case is 117.8 billion Won and the advance payment is 124.8 billion Won.

- 93 -

22.

NET DEFINED BENEFIT LIABILITY (ASSET)

The characteristics of the Group's defined benefit retirement pension plans are as follows:

Employees and directors with one or more years of service are entitled to receive a payment upon termination of their employment, based on their length of service and rate of salary at the time of termination. The assets of the plans are measured at their fair value at the end of reporting date. The plan liabilities are measured using the projected unit method, which takes account of projected earnings increases, using actuarial assumptions that give the best estimate of the future cash flows that will arise under the plan liabilities.

The Group is exposed to various risks through defined benefit retirement pension plan, and the most significant risks are as follows:

Volatility of asset

The defined benefit obligation was estimated with an interest rate calculated based on blue chip corporate bonds earnings. A deficit may occur if the rate of return of plan assets falls short of the interest rate.

Decrease in profitability of blue-chip bonds

A decrease in profitability of blue-chip bonds will be offset by some increase in the value of debt securities that the employee benefit plan owns but will bring an increase in the defined benefit obligation.

Risk of inflation

Defined benefit obligations are related to inflation rate; the higher the inflation rate is, the higher the level of liabilities. Therefore, deficit occurs in the system if an inflation rate increases.
(1)

Details of net defined benefit liability are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Present value of defined benefit obligation

1,600,644 1,610,680

Fair value of plan assets

(1,544,717 ) (1,564,101 )

Net defined benefit liabilities (*)

55,927 46,579
(*)

Net defined benefit liability of 55,927 million Won and 46,579 million Won as of June 30, 2021 and December 31, 2020 is the subtracted amount of the net defined benefit asset of 1,809 million Won 5,658 million Won from the net defined benefit liability of 57,736 million Won and 52,237 million Won.

(2)

Changes in the carrying value of defined benefit obligation are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30
2021 2020

Beginning balance

1,610,680 1,442,859

Current service cost

89,184 86,569

Interest cost

19,897 16,768

Remeasurements

Financial assumption (57,040 ) 15,857
Demographic assumptions - -
Experience adjustments 30,247 16,264

Retirement benefit paid

(92,981 ) (47,118 )

Foreign currencies translation adjustments

22 43

Others

635 1,253

Ending balance

1,600,644 1,532,495

- 94 -

(3)

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

For the six-month period ended June 30
2021 2020

Beginning balance

1,564,101 1,352,971

Interest income

20,418 17,152

Remeasurements

(8,030 ) (4,073 )

Employer's contributions

61,009 66,809

Retirement benefit paid

(92,811 ) (46,725 )

Others

30 36

Ending balance

1,544,717 1,386,170
(4)

Fair value of plan assets as of June 30, 2021 and December 31, 2020 is as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Cash and due from banks

1,544,717 1,564,101

Meanwhile, among plan assets, realized returns on plan assets amount to 12,388 million Won and 13,079 million Won for the six-month periods ended June 30, 2021 and 2020, respectively.

(5)

Current service cost, net interest income, loss(gain) on the curtailment or settlement and remeasurements recognized in the consolidated statements comprehensive income are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30
2021 2020

Current service cost

89,184 86,569

Net interest expense(income)

(521 ) (384 )

Cost recognized in net income

88,663 86,185

Remeasurements (*)

(18,763 ) 36,194

Cost recognized in total comprehensive income

69,900 122,379
(*)

Amount before tax

Meanwhile, retirement benefits related to defined contribution plans recognized as expenses are 2,339 million Won and 2,022 million Won for the six-month periods ended June 30, 2021 and 2020, respectively.

- 95 -

23.

OTHER FINANCIAL LIABILITIES AND OTHER LIABILITIES

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

June 30, 2021 December 31, 2020

Other financial liabilities:

Accounts payable

6,597,639 4,028,639

Accrued expenses

1,595,324 2,049,401

Borrowings from trust accounts

2,986,765 2,984,031

Agency business revenue

500,048 466,485

Foreign exchange payables

738,204 789,189

Domestic exchange settlement credits

5,289,346 180,251

Lease liabilities

341,419 407,431

Other miscellaneous financial liabilities

3,512,757 3,317,358

Present value discount

(11,748 ) (6,968 )

Sub-total

21,549,754 14,215,817

Other liabilities:

Unearned income

260,785 254,702

Other miscellaneous liabilities

210,749 219,111

Sub-total

471,534 473,813

Total

22,021,288 14,689,630

- 96 -

24.

DERIVATIVES

(1)

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

June 30, 2021
Assets Liabilities
Nominal
amount 		For cash
flow hedge 		For fair
value
hedge 		For trading For cash
flow hedge 		For fair
value
hedge 		For trading

Interest rate:

Futures

278,086 - - - - - -

Swaps

134,262,286 - 129,562 188,490 205 10,112 397,788

Purchase options

210,000 - - 4,485 - - -

Written options

340,000 - - - - - 8,334

Currency:

Futures

36,126 - - - - - -

Forwards

111,145,688 - - 1,460,534 - 479 913,417

Swaps

95,610,795 - - 1,569,192 33,249 - 1,372,358

Purchase options

1,186,337 - - 6,841 - - -

Written options

1,990,306 - - - - - 7,646

Equity:

Futures

364,673 - - - - - -

Forwards

11 - - - - - -

Swaps

553,138 - - 351 - - 22,151

Purchase options

13,727,313 - - 794,775 - - -

Written options

14,878,040 - - - - - 936,010

Total

374,582,799 - 129,562 4,024,668 33,454 10,591 3,657,704
December 31, 2020
Assets Liabilities
Nominal
amount 		For cash
flow hedge 		For fair
value
hedge 		For trading For cash
flow hedge 		For fair
value
hedge 		For trading

Interest rate:

Futures

184,413 - - - - - -

Swaps

137,057,240 - 174,820 318,545 1,476 28 524,190

Purchase options

330,000 - - 6,271 - - -

Written options

285,440 - - - - - 5,419

Currency:

Futures

2,546 - - - - - -

Forwards

105,146,634 - - 2,541,957 - - 2,848,980

Swaps

87,249,320 - - 3,325,135 63,265 - 2,415,610

Purchase options

1,147,877 - - 59,329 - - -

Written options

1,632,048 - - - - - 23,271

Equity:

Futures

123,742 - - - - - -

Forwards

11 - - - - - -

Swaps

269,039 - - - - - 12,533

Purchase options

9,863,110 - - 650,505 - - -

Written options

10,369,009 - - - - - 629,884

Total

353,660,429 - 174,820 6,901,742 64,741 28 6,459,887

Derivatives held for trading are classified into financial assets at FVTPL (Note 7) and financial liabilities at FVTPL (Note 18), and derivatives designated for hedging are presented as a separate line item in the consolidated statements of financial position.

- 97 -

(2)

Overview of the Group's hedge accounting

The hedging relationships that the Group applies fair value hedge accounting and cash flow hedge accounting to are affected by interest rate which is related with Interest Rate Benchmark Reform. The interest rates to which the hedging relationships are exposed are USD 1M LIBOR, USD 3M LIBOR and AUD 3M BBSW. The nominal amounts of hedging instruments related to 1M LIBOR, 3M LIBOR and 3M BBSW in the hedging relationships of the Group are USD 470,000,000, USD 2,350,000,000 and AUD 150,000,000, respectively. The Group pays close attention to discussions in the market and industry regarding the applicable alternative benchmark interest rates for the exposed interest rate. The Group determined that such uncertainty is expected to be no longer exist when the exposed interest rates are replaced by the applicable benchmark interest rates.

1)

Fair value hedge

As of the June 30, 2021, the Group has applied fair value hedge on fixed interest rate foreign currency denominated debentures amounting to 2,862,453 million Won. It is the Group's hedging strategy to hedge changes in fair value of fixed rate debentures denominated in foreign currency attributable to fluctuations in market interest rates, and as such the Group entered into interest rate swap agreements designated as hedging instruments.

Pursuant to the interest rate swap agreement, by swapping the calculated difference between the fixed interest rate and floating interest rate applied to the nominal value, the fair value fluctuation risk is hedged as the foreign currency denominated debentures fixed interest rate terms are converted to floating interest rate. Pursuant to the interest rate swap agreement, hedge ratio is determined by matching the nominal value of hedging instrument to the face value of the hedged item.

In this hedging relationship, only the market interest rate fluctuation, which is the most significant part of the fair value change of the hedged item, is designated as the hedged risk, and other risk factors including credit risk are not included in the hedged risk. Therefore, the ineffective portion of the hedge could arise from fluctuations in the timing of the cash flow of the hedged item, price margin set by counterparty of hedging instrument, and unilateral change in credit risk of any party of hedging instrument.

The interest rate swap agreements and the hedged items are subject to fluctuations in the underlying market rate of interest and the Group expects the fair value of the interest rate swap contract and the value of the hedged item to generally change in the opposite direction.

The fair value of the interest rate swap at the end of the reporting period is determined by discounting future cash flows estimated by using the yield curve at the end of the reporting period and the credit risk embedded in the contract and the average interest rate is determined based on the outstanding balance at the end of the reporting period. The variable interest rate applied to the interest rate swap is USD Libor 3M plus spread and AUD BBSW 3M plus spread. In accordance with the terms of each interest rate swap contract designated as a hedging instrument, the Group receives interest at a fixed interest rate and pays interest at a variable interest rate.

In addition, as of June 30, 2021, the Group has applied fair value hedge for 13,874 million Won of equity securities in foreign currencies. It is the Group's hedging strategy to hedge changes in fair value of equity securities in foreign currencies invested in EUR attributable to fluctuations in spot exchange rates (USD/EUR), and as such the Group entered into forward exchange agreements designated as hedging instruments. By recognizing the difference calculated by applying the difference in spot exchange rate to a predetermined nominal amount under a forward exchange agreement, the resulting nominal amount is converted from EUR to USD at maturity and the risk of changes in fair value is eliminated. In this hedging relationship, only changes in the fair value of the hedged item are designated as the hedged risk, and other risk factors, including credit risk, are not included in the hedged risk. Consequently, changes in the price margins of the hedging instrument counterparty and the credit risk of either party to the hedging instrument may result in hedge ineffectiveness. Forward exchange agreements and hedged items are affected by changes in spot exchange rates, which are fundamental variables.

- 98 -

2)

Cash Flow Hedge

As of the June 30, 2021, the Group has applied cash flow hedge on local currency denominated debentures amounting to 149,957 million Won, debentures on foreign currency amounting to 642,606 million Won. The Group's hedging strategies are to ① Mitigate risks of cash flow fluctuation from variable interest rate debentures on local currency due to changes in market interest rate by entering into an interest rate swap contract and thereby designating it as hedging instrument; ② Mitigate the risks of cash flow fluctuation from principal and interest of variable interest rate debentures denominated in foreign currency due to changes in foreign exchange rates and interest rates by entering into a currency swap contract and thereby designating it as hedging instrument; ③ Mitigate the risks of cash flow fluctuation from principal and interest of fixed interest rate debentures denominated in foreign currency due to changes in foreign exchange rates by entering into a currency swap contract and thereby designating it as hedging instrument and ④ Mitigate the risks of cash flow fluctuation in variable interest rate foreign currency borrowings resulting from changes in market interest rates and designate it as a hedging instrument through entering into currency swap contracts and interest rate swap contracts.

This means exchanging a predetermined nominal amount as set forth in the interest rate swap contract adjusted by the differences between the fixed and variable interest rates, which results in the conversion of interest rates of debentures in local currency from variable interest into fixed interest, eliminating the cash flow fluctuation risk.

In addition, this also means a payment of predetermined principal amount as set forth in the currency swap adjusted by fixed interest rate, an exchange of an amount calculated by applying variable interest rate to USD or applying fixed interest rate to SGD, and an exchange of the principal denominated in KRW and principal denominated in foreign currency at maturity eliminating cash flow fluctuation risk on principal and interest.

The hedge ratio is determined by matching the nominal amount of the hedging instrument to the face amount of the hedged item in accordance with interest rate swap and currency swap.

Only interest rate and foreign exchange rate fluctuation risk, which is the most significant factor in the cash flow fluctuation of the hedged item, is addressed in this hedging relationship, and other risk factors such as credit risk are not subject to hedging.

Accordingly, hedge ineffectiveness may arise from price margin set by the counterparty of hedging instruments and unilateral change in credit risk of any party in the transaction.

The interest rate swap, currency swap contract and the hedged item are all affected by the changes in market interest rate and foreign exchange rates which are basic factors of the derivative. The Group expects that the value of interest rate swap contract, currency swap contract and value of the hedged item will generally fluctuate in opposite direction.

- 99 -

(3)

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

June 30, 2021
1 year or less 1 year to 5 years More than 5
years 		Total

Fair value hedge

Interest rate risk

Interest rate swap (USD)

500,000,000 1,550,000,000 300,000,000 2,350,000,000

Interest rate swap (AUD)

- 150,000,000 - 150,000,000

Foreign exchange rate risk

Currency forward (EUR/USD)

- - 10,313,901 10,313,901

Cash flow hedge

Interest rate risk

Interest rate swap (KRW)

100,000 50,000 - 150,000

Foreign currencies translation risk and interest rate risk

Currency swap (USD)

- 470,000,000 - 470,000,000

Foreign currencies translation risk

Currency swap (USD)

- 100,000,000 - 100,000,000
December 31, 2020
1 year or less 1 year to 5 years More than 5
years 		Total

Fair value hedge

Interest rate risk

Interest rate swap (USD)

1,000,000,000 1,000,000,000 300,000,000 2,300,000,000

Interest rate swap (AUD)

- 150,000,000 - 150,000,000

Cash flow hedge

Interest rate risk

Interest rate swap (KRW)

100,000 50,000 - 150,000

Foreign currencies translation risk and interest rate risk

Currency swap (USD)

130,000,000 470,000,000 - 600,000,000

Foreign currencies translation risk

Currency swap (SGD)

68,000,000 - - 68,000,000

- 100 -

(4)

The average interest rate and average currency rate of the hedging instrument as of June 30, 2021 and December 31, 2020 are as follows:

June 30, 2021

Average interest rate and average exchange rate

Fair value hedge

Interest rate risk

Interest rate swap (USD)

Fixed 3.41%% receipt and Libor 3M + 1.51% floating paid

Interest rate swap (AUD)

Fixed 0.84% receipt and BBSW 3M+0.72% paid

Foreign exchange rate risk

Currency forward (EUR/USD)

USD 13,369,910 receipt and EUR 10,313,901 paid

Cash flow hedge

Interest rate risk

Interest rate swap (KRW)

KRW 3Y CMS+0.40% receipt, 2.38% paid

KRW CD+0.73% receipt, 1.90% paid

Foreign currencies translation risk and interest rate risk

Currency swap (USD)

USD 1M Libor+0.70% receipt, KRW 0.93% paid, USD/KRW = 1,207

Foreign currencies translation risk

Currency swap (USD)

USD 1.75% receipt, KRW 1.63% paid, USD/KRW = 1,139

December 31, 2020

Average interest rate and average exchange rate

Fair value hedge

Interest rate risk

Interest rate swap (USD)

Fixed 4.22% receipt and Libor 3M+1.71% floating paid

Fixed 5.88% receipt and Libor 6M+2.15% floating paid

Interest rate swap (AUD)

Fixed 0.84% receipt and BBSW 3M+0.72% paid

Cash flow hedge

Interest rate risk

Interest rate swap (KRW)

KRW 3Y CMS+0.40% receipt, 2.38% paid

KRW CD+0.69% receipt, 2.06% paid

KRW CD+0.33% receipt, 1.68% paid

Foreign currencies translation risk and interest rate risk

Currency swap (USD)

USD 3M Libor+0.80% receipt, KRW 1.45% paid, USD/KRW = 1,155

USD 1M Libor+0.67% receipt, KRW 1.14% paid, USD/KRW = 1,190

USD 1M Libor+0.69% receipt, KRW 1.02% paid, USD/KRW = 1,199

Foreign currencies translation risk

Currency swap (SGD)

SGD 1.91% receipt, KRW 1.98% paid, SGD/KRW = 827

- 101 -

(5)

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

June 30, 2021
Nominal amounts of
the hedging
instrument 		Carrying amounts of the hedging
instrument 		Line item in
the statement of financial position
where the hedging instrument is located 		Changing in fair
value used for
calculating hedge
ineffectiveness
Assets Liabilities

Fair value hedge

Interest rate risk

Interest rate swap

USD 2,350,000,000
Derivative assets

(designated for hedging)


Interest rate swap

AUD 150,000,000 129,562 10,112
Derivative liabilities

(designated for hedging)


(47,455 )

Foreign exchange rate risk

Forward exchange

EUR 10,313,901 - 479
Derivative liabilities

(designated for hedging)


479

Cash flow hedge

Interest rate risk

Interest rate swap

KRW 150,000 - 205
Derivative liabilities

(designated for hedging)


1,271

Foreign currency translation risk and interest rate risk

Currency swap

USD 470,000,000 - 32,431
Derivative liabilities

(designated for hedging)


31,127

Foreign currency translation risk

Currency swap

USD 100,000,000 - 818
Derivative liabilities

(designated for hedging)


359
December 31, 2020
Nominal amounts of
the hedging
instrument 		Carrying amounts of the hedging
instrument 		Line item in
the statement of financial position
where the hedging instrument is located 		Changing in fair
value used for
calculating hedge
ineffectiveness
Assets Liabilities

Fair value hedge

Interest rate risk

Interest rate swap

USD 2,300,000,000
Derivative assets

(designated for hedging)


Interest rate swap

AUD 150,000,000 174,820 28
Derivative liabilities

(designated for hedging)


57,221

Cash flow hedge

Interest rate risk

Interest rate swap

KRW 150,000 - 1,476
Derivative liabilities

(designated for hedging)


(196 )

Foreign currency translation risk and interest rate risk

Currency swap

USD 600,000,000 - 62,893
Derivative liabilities

(designated for hedging)


(69,319 )

Foreign currency translation risk

Currency swap

SGD 68,000,000 - 373
Derivative liabilities

(designated for hedging)


(4,699 )

- 102 -

(6)

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

June 30, 2021
Carrying amounts of
the hedged item 		Accumulated amount of fair
value hedge adjustments on
the hedged item included in
the carrying amount of the
hedged item 		Line item in the
statement of
financial position
in which the
hedged item is
included 		Changing in
fair value used
for calculating
hedge
ineffectiveness 		Cash flow
hedge
reserve (*)
Assets Liabilities Assets Liabilities

Fair value hedge

Interest rate risk

Debentures

- 2,862,453 - 89,039 Debentures 55,352 -

Foreign exchange rate risk

Equity securities in foreign currencies

13,874 - 479 -

Equity
securities
in foreign
currencies

479 -

Cash flow hedge

Interest rate risk

Debentures

- 149,957 - - Debentures (1,236 ) (7 )

Foreign currencies translation risk and interest rate risk

Debentures

- 530,279 - - Debentures (24,395 ) 3,202

Foreign currencies translation risk

Debentures

- 112,327 - - Debentures 251 23
(*)

After tax amount

December 31, 2020
Carrying amounts of
the hedged item 		Accumulated amount of fair
value hedge adjustments on
the hedged item included in
the carrying amount of the
hedged item 		Line item in the
statement of
financial position
in which the
hedged item is
included 		Changing in
fair value used
for calculating
hedge
ineffectiveness 		Cash flow
hedge
reserve (*)
Assets Liabilities Assets Liabilities

Fair value hedge

Interest rate risk

Debentures

- 2,767,208 - 144,741 Debentures (59,073 ) -

Cash flow hedge

Interest rate risk

Debentures

- 149,936 - - Debentures 188 (909 )

Foreign currencies translation risk and interest rate risk

Debentures

- 651,704 - - Debentures 61,823 (95 )

Foreign currencies translation risk

Debentures

- 55,891 - - Debentures 6,564 (268 )
(*)

After tax amount

- 103 -

(7)

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

For the six-month period ended June 30, 2021
Hedge ineffectiveness
recognized in profit or loss 		Line item in the profit or loss that
includes hedge ineffectiveness

Fair value hedge

Interest rate risk 7,897 Other net operating
income (expense)

Foreign exchange
rate risk
479 Other net operating
income (expense)
For the six-month period ended June 30, 2020
Hedge ineffectiveness
recognized in profit or loss 		Line item in the profit or loss that
includes hedge ineffectiveness

Fair value hedge

Interest rate risk 2,584 Other net operating
income (expense)
(8)

Reclassification of profit or loss from other comprehensive income and equity related to cash flow hedges are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Changes in
the value of
hedging
instruments
recognized in OCI 		Hedge
ineffectiveness
recognized in
profit or loss 		Changes in
the value
of foreign
basis
spread
recognized
in OCI 		Line item
recognized
in the profit
or loss 		Amounts
reclassified
from cash
flow hedge
reserve to
profit or
loss 		Line item affected in
profit or loss due to
reclassification

Cash flow hedge

Interest rate risk 1,243 28 - Other net
operating
income
(expense) 		- Other net operating
income (expense)


Foreign currencies
translation risk
and interest rate
risk

30,957 169 (1,628 ) Other net
operating
income
(expense) 		(26,041 ) Other net operating
income (expense)

Foreign currencies
translation risk
617 (258 ) (223 ) Other net
operating
income
(expense) 		(95 ) Other net operating
income (expense)
For the six-month period ended June 30, 2020
Changes in
the value of
hedging
instruments
recognized in OCI 		Hedge
ineffectiveness
recognized in
profit or loss 		Changes in
the value
of foreign
basis
spread
recognized
in OCI 		Line item
recognized
in the profit
or loss 		Amounts
reclassified
from cash
flow hedge
reserve to
profit or
loss 		Line item affected in
profit or loss due to
reclassification

Cash flow hedge

Interest rate risk (1,133 ) (54 ) - Other net
operating
income
(expense) 		- Other net operating
income (expense)


Foreign currencies
translation risk
and interest rate
risk

1,581 673 (1,812 ) Other net
operating
income
(expense) 		(9,816 ) Other net operating
income (expense)

Foreign currencies
translation risk
1,172 306 7 Other net
operating
income
(expense) 		(651 ) Other net operating
income (expense)

- 104 -

25.

DEFERRED DAY 1 PROFITS OR LOSSES

Changes in deferred day 1 profits or losses are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30
2021 2020

Beginning balance

6,939 52,260

New transactions

37,040 26,267

Amounts recognized in losses

(12,564 ) (35,306 )

Ending balance

31,415 43,221

In case some variables to measure fair values of financial instruments are not observable in the market, valuation techniques are utilized to evaluate such financial instruments. Those financial instruments are recorded the transaction price as at the time of acquisition, even though there are difference noted between the transaction price and the fair value, which is deferred and amortized to maturity using the effective interest method and reflected in profit and loss. The table above presents the difference yet to be realized as profit or loss at the end of June 30, 2021 and 2020.

26.

EQUITY

(1)

Details of equity as of June 30, 2021 and December 31, 2020 are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Capital

Common stock capital

3,611,338 3,611,338

Hybrid securities

2,094,818 1,895,366

Capital surplus

Paid in capital in excess of par

608,348 608,348

Others

23,020 17,763

Sub-total

631,368 626,111

Capital adjustments

Treasury stock

- -

Other adjustments (*1)

(1,721,091 ) (1,775,312 )

Sub-total

(1,721,091 ) (1,775,312 )

Accumulated other comprehensive income

Financial assets at FVTOCI

2,430 (9,833 )

Changes in capital due to equity method

64 (2,609 )

Loss from foreign business translation

(213,724 ) (298,363 )

Remeasurements of defined benefit plan

(247,577 ) (261,195 )

Loss on evaluation of cash flow hedge

2,503 (1,386 )

Capital related to noncurrent assets held for sale

666 1,226

Sub-total

(455,638 ) (572,160 )

Retained earnings (*2) (*3)

20,398,356 19,268,265

Non-controlling interest (*4)

3,601,023 3,672,237

Total

28,160,174 26,725,845
(*1)

Included 178,060 million Won in capital transaction gains and losses recognized by Woori Bank and (formerly) Woori Financial Group in 2014 and 2,238,228 million Won due to the spin-off of Gyeongnam Bank and Gwangju Bank.

(*2)

The regulatory reserve for credit losses in retained earnings amounted to 2,568,367 million Won and 2,547,547 million Won as of June 30, 2021 and December 31, 2020, respectively in accordance with the relevant article.

(*3)

The earned surplus reserve in retained earnings amounted to 122,370 million Won and 62,830 million Won as of June 30, 2021 and December 31, 2020 in accordance with the Article 53 of the Financial Holding Company Act.

(*4)

The hybrid securities issued by Woori Bank amounting to 3,105,070 million Won as of June 30, 2021 and December 31, 2020, respectively, are recognized as non-controlling interests. 71,537 million Won and 90,091 million Won of dividends for the hybrid securities issued by Woori Bank are allocated to net profit and loss of the non-controlling interests for the six-month period ended June 30, 2021 and 2020, respectively.

- 105 -

(2)

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

June 30, 2021 December 31, 2020

Shares of common stock authorized

4,000,000,000 Shares 4,000,000,000 Shares

Par value

5,000 Won 5,000 Won

Shares of common stock issued

722,267,683 Shares 722,267,683 Shares

Capital stock

3,611,338 million Won 3,611,338 million Won
(3)

Hybrid securities

The bond-type hybrid securities classified as owner's equity are as follows (Unit: Korean Won in millions):

Issue date Maturity Interest rate
(%) 		June 30,
2021 		December 31,
2020

Securities in local currency

2019-07-18 - 3.49 500,000 500,000

Securities in local currency

2019-10-11 - 3.32 500,000 500,000

Securities in local currency

2020-02-06 - 3.34 400,000 400,000

Securities in local currency

2020-06-12 - 3.23 300,000 300,000

Securities in local currency

2020-10-23 - 3.00 200,000 200,000

Securities in local currency

2021-04-08 - 3.15 200,000 -

Issuance cost

(5,182 ) (4,634 )

Total

2,094,818 1,895,366

The hybrid securities mentioned above do not have maturity date but are redeemable after 5 years from date of issuance.

(4)

Accumulated other comprehensive income

Changes in the accumulated other comprehensive income are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021
Beginning
balance 		Increase
(decrease) (*) 		Reclassification
adjustments 		Income tax
effect (*) 		Ending
balance

Net gain(loss) on valuation of financial assets at FVTOCI

(9,833 ) 63,949 (45,059 ) (6,627 ) 2,430

Changes in capital due to equity method

(2,609 ) 2,495 - 178 64

Gain(loss) on foreign currency translation of foreign operations

(298,363 ) 85,763 - (1,124 ) (213,724 )

Remeasurement gain(loss) related to defined benefit plan

(261,195 ) 18,782 - (5,164 ) (247,577 )

Gain(loss) on valuation of derivatives designated as cash flow hedges

(1,386 ) 3,084 896 (91 ) 2,503

Capital related to noncurrent assets held for sale

1,226 (772 ) - 212 666

Total

(572,160 ) 173,301 (44,163 ) (12,616 ) (455,638 )
(*)

The increase and decrease of financial asset valuation profit or loss at fair value through other comprehensive income and capital related to noncurrent assets held for sale is a change due to the period evaluation and the reclassification adjustments amounting to 33,448 million Won, (797) million Won and 560 million Won are due to disposal of equity securities at FVTOCI, investment stocks accounted for using the equity method and assets held for sale during the period.

- 106 -

For the six-month period ended June 30, 2020
Beginning
balance 		Increase
(decrease) (*) 		Reclassification
adjustments 		Income tax
effect 		Ending
balance

Net gain (loss) on valuation of financial assets at FVTOCI

(71,914 ) (20,412 ) (13,587 ) 8,880 (97,033 )

Changes in capital due to equity method

915 (6,374 ) - 1,753 (3,706 )

Gain(loss) on foreign currency translation of foreign operations

(152,987 ) 58,028 - (3,583 ) (98,542 )

Remeasurement gain(loss) related to defined benefit plan

(270,977 ) (36,194 ) - 9,953 (297,218 )

Gain(loss) on valuation of derivatives designated as cash flow hedges

(5,692 ) (11,032 ) - 1,002 (15,722 )

Total

(500,655 ) (15,984 ) (13,587 ) 18,005 (512,221 )
(*)

The increase and decrease of financial asset valuation profit or loss at fair value through other comprehensive income is a change due to the period evaluation and the reclassification adjustments amounting to 578 million Won are due to disposal of equity securities during the period.

(5)

Regulatory Reserve for Credit Loss

In accordance with Article 26 ~ 28 of the Financial holding company Supervision Regulations, the Group calculates and discloses the regulatory reserve for credit loss.

1)

Balance of the regulatory reserve for credit loss

Balance of the planned regulatory reserve for credit loss is as follows (Unit: Korean Won in millions):

June 30,
2021 		December 31,
2020

Beginning balance

2,568,367 2,547,547

Planned provision(reversal) of regulatory reserve for credit loss

163,847 20,820

Ending balance

2,732,214 2,568,367
2)

Provision of regulatory reserve for credit loss, adjusted income after the provision of regulatory reserve and others

Planned reserves provided, adjusted net income after the planned reserves provided and adjusted EPS after the planned reserves provided are as follows (Unit: Korean Won in millions, except for EPS amount):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Net income before regulatory reserve

818,384 1,537,251 216,262 774,033

Provision(reversal) of regulatory reserve for credit loss

80,767 163,847 (80,155 ) (12,236 )

Adjusted net income after the provision of regulatory reserve

737,617 1,373,404 296,417 786,269

Dividends to hybrid securities

(15,775 ) (31,550 ) (11,852 ) (20,365 )

Adjusted net income after regulatory reserve and dividends to hybrid securities

721,842 1,341,854 284,565 765,904

Adjusted EPS after regulatory reserve and the dividends to hybrid securities (Unit: Korean Won)

1,000 1,858 394 1,061

- 107 -

27.

DIVIDENDS

(1)

Dividends per share and the total dividends for the fiscal year ending December 31, 2020 were 360 Won and 260,016 million Won, respectively, and the dividends were approved at the regular general shareholders' meeting held on March 26, 2021, and were paid in April, 2021.

(2)

On July 23, 2021, the Group declared the interim dividend of 150 Won per share (total dividend of 108,340 million Won) with July 30, 2021 as the record date, in accordance with a resolution of the Board of Directors.

28.

NET INTEREST INCOME

(1)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Financial assets at FVTPL

11,046 22,420 13,681 26,210

Financial assets at FVTOCI

83,821 175,607 114,823 241,000

Financial assets at amortized cost

Securities at amortized cost

79,129 161,372 98,001 202,060

Loans and other financial assets at amortized cost

Interest on due from banks

10,484 19,938 9,866 32,735

Interest on loans

2,191,158 4,315,503 2,168,347 4,398,249

Interest of other receivables

7,648 15,631 7,471 15,749

Subtotal

2,209,290 4,351,072 2,185,684 4,446,733

Total

2,383,286 4,710,471 2,412,189 4,916,003
(2)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Interest on deposits due to customers

444,895 912,346 664,329 1,413,501

Interest on borrowings

47,311 95,865 80,915 165,586

Interest on debentures

177,528 359,156 178,699 367,192

Other interest expense

8,788 16,713 8,232 23,593

Interest on lease liabilities

1,811 3,772 2,124 5,282

Total

680,333 1,387,852 934,299 1,975,154

- 108 -

29.

NET FEES AND COMMISSIONS INCOME

(1)

Details of fees and commissions income recognized are as follows (Unit: Korean Won in millions):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Fees and commission received for brokerage

48,867 95,991 40,910 81,136

Fees and commission received related to credit

57,328 106,809 43,976 96,904

Fees and commission received for electronic finance

34,739 66,696 30,081 61,764

Fees and commission received on foreign exchange handling

14,275 27,539 13,407 27,798

Fees and commission received on foreign exchange

18,356 31,939 15,359 32,034

Fees and commission received for guarantee

18,535 36,072 18,940 37,068

Fees and commission received on credit card

141,129 278,523 125,980 249,267

Fees and commission received on securities business

33,684 57,745 22,465 38,896

Fees and commission from trust management

51,231 98,435 35,929 86,292

Fees and commission received on credit information

2,676 5,099 3,791 7,194

Fees and commission received related to lease

86,442 168,634 - -

Other fees

39,789 92,434 46,444 89,640

Total

547,051 1,065,916 397,282 807,993
(2)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Fees and commissions paid

67,143 126,989 52,045 93,405

Credit card commission

105,766 203,516 118,647 211,784

Brokerage commission

317 556 156 217

Others

2,832 5,401 2,065 4,238

Total

176,058 336,462 172,913 309,644
30.

DIVIDEND INCOME

(1)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Dividend income related to financial assets at FVTPL

61,125 114,442 21,576 54,382

Dividend income related to financial assets at FVTOCI

3,023 16,296 1,657 16,620

Total

64,148 130,738 23,233 71,002
(2)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Dividend income recognized from assets held

Equity securities

3,023 16,296 1,657 16,620

- 109 -

31.

NET GAIN OR LOSS ON FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS MANDATORILY MEASURED AT FAIR VALUE

(1)

Details of gains or losses related to net gain or loss on financial instruments at FVTPL are as follows (Unit: Korean Won in millions):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Gain(loss) on financial instruments at FVTPL measured at fair value

55,184 136,305 (64,135 ) 393,168

Gain(loss) on financial instruments at FVTPL designated as upon initial recognition

(860 ) 102 (2,351 ) 8,421

Total

54,324 136,407 (66,486 ) 401,589
(2)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Financial
assets at FVTPL

Securities

Gain on transactions and valuation

66,625 145,444 48,576 97,202

Loss on transactions and valuation

(47,607 ) (99,481 ) (2,851 ) (71,218 )
Sub-total 19,018 45,963 45,725 25,984
Loans

Gain on transactions and valuation

8,592 14,089 1,660 1,730

Loss on transactions and valuation

(2,686 ) (4,081 ) (100 ) (862 )
Sub-total 5,906 10,008 1,560 868
Other financial assets

Gain on transactions and valuation

2,520 7,819 1,638 4,505

Loss on transactions and valuation

(1,858 ) (5,412 ) (1,508 ) (4,195 )
Sub-total 662 2,407 130 310

Sub-total

25,586 58,378 47,415 27,162

Derivatives
(Held for trading)

Interest rates derivatives

Gain on transactions and valuation

391,344 845,923 356,000 986,560

Loss on transactions and valuation

(370,337 ) (745,974 ) (375,781 ) (1,320,559 )
Sub-total 21,007 99,949 (19,781 ) (333,999 )
Currency derivatives

Gain on transactions and valuation

398,232 4,532,105 45,273 6,200,908

Loss on transactions and valuation

(395,527 ) (4,567,000 ) (110,208 ) (5,497,798 )
Sub-total 2,705 (34,895 ) (64,935 ) 703,110
Equity derivatives

Gain on transactions and valuation

255,081 1,064,630 (41,433 ) 1,107,537

Loss on transactions and valuation

(249,095 ) (1,050,952 ) 14,755 (1,110,279 )
Sub-total 5,986 13,678 (26,678 ) (2,742 )
Other derivatives

Gain on transactions and valuation

- - - -

Loss on transactions and valuation

(100 ) (805 ) (156 ) (363 )
Sub-total (100 ) (805 ) (156 ) (363 )

Sub-total

29,598 77,927 (111,550 ) 366,006

Net, total

55,184 136,305 (64,135 ) 393,168

- 110 -

(3)

Details of net gain(loss) on financial instruments at fair value through profit or loss designated as upon initial recognition and Losses on financial instruments designated as at fair value through profit or loss are as follows (Unit: Korean Won in millions):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Gain(loss) on equity-linked securities

(860 ) 102 (2,351 ) 8,421
32.

NET GAIN OR LOSS ON FINANCIAL ASSETS AT FVTOCI

Details of net gain or loss on financial assets at FVTOCI recognized are as follows (Unit: Korean Won in millions):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Gain on redemption of securities

(11 ) (10 ) (35 ) (74 )

Gain on transactions of securities

8,059 45,069 8,462 11,101

Total

8,048 45,059 8,427 11,027
33.

REVERSAL OF(PROVISION FOR) IMPAIRMENT LOSSES DUE TO CREDIT LOSS

Reversal of (provision for) impairment losses due to credit loss are as follows (Unit: Korean Won in millions):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Impairment loss due to credit loss on financial assets measured at FVTOCI

(1,079 ) (2,097 ) (770 ) (782 )

Reversal of(provision for) impairment loss due to credit loss on securities at amortized cost

106 293 (190 ) (47 )

Provision for impairment loss due to credit loss on loan and other financial assets at amortized cost

(83,507 ) (220,715 ) (319,532 ) (422,066 )

Reversal of(provision for) provision on guarantee

8,454 7,597 2,435 (3,972 )

Reversal of(provision for) unused loan commitment

7,443 10,346 (17,730 ) (19,812 )

Total

(68,583 ) (204,576 ) (335,787 ) (446,679 )

- 111 -

34.

GENERAL AND ADMINISTRATIVE EXPENSES AND OTHER NET OPERATING INCOME(EXPENSES)

(1)

Details of general and administrative expenses recognized are as follows (Unit: Korean Won in millions):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Employee benefits

Short-term employee benefits Salaries 390,030 794,269 374,978 770,314
Employee fringe benefits 139,143 269,252 126,905 248,461
Share based payment 5,505 7,858 2,745 2,316
Retirement benefit service costs 45,369 91,002 43,860 88,207
Termination 274 555 558 221
Subtotal 580,321 1,162,936 549,046 1,109,519

Depreciation and amortization

129,080 264,505 124,289 258,964

Other general and administrative expenses

Rent 21,430 40,736 20,246 35,172
Taxes and public dues 41,373 78,529 40,080 74,268
Service charges 60,657 113,715 59,737 116,624
Computer and IT related 28,724 55,234 26,416 52,839
Telephone and communication 19,475 37,612 18,266 35,091
Operating promotion 9,756 18,959 9,696 20,718
Advertising 18,786 28,351 19,060 28,412
Printing 1,370 3,020 1,481 3,376
Traveling 1,665 3,369 1,521 3,698
Supplies 1,704 3,412 3,670 6,907
Insurance premium 2,486 5,040 2,746 5,551
Reimbursement 1,815 1,289 4,185 4,855
Maintenance 4,873 9,778 4,088 7,994
Water, light, and heating 2,969 7,327 3,188 7,640
Vehicle maintenance 2,856 5,202 2,346 4,821
Others 8,546 16,479 6,971 13,109
Sub-total 228,485 428,052 223,697 421,075

Total

937,886 1,855,493 897,032 1,789,558
(2)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Gain on transactions of foreign exchange

210,908 332,740 191,767 269,151

Gain related to derivatives
(Designated for hedging)

478 26,477 (7,637 ) 132,356

Gain on fair value hedged items

2,609 61,262 - -

Others

27,874 52,215 23,948 32,754

Total

241,869 472,694 208,078 434,261
(3)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Losses on transactions of foreign exchange

101,259 217,299 47,544 464,540

KDIC deposit insurance premium

100,673 198,218 91,319 180,530

Contribution to miscellaneous funds

90,455 176,601 78,335 156,969

Losses related to derivatives (Designated for hedging)

2,970 53,359 8,950 9,324

Losses on fair value hedged items

- - 2,322 108,090

Others (*)

94,185 186,265 20,877 61,451

Total

389,542 831,742 249,347 980,904
(*)

Other expense includes such expenses amounting to 6,808 million Won and 6,786 million Won, respectively, of intangible asset amortization expense for the six-month periods ended June 30, 2021 and 2020, respectively.

- 112 -

(4)

Share-based payment

Details of performance condition share-based payment granted to executives as of June 30, 2021 and December 31, 2020 are as follows.

1)

Performance condition share-based payment

Subject to

Shares granted for the year 2019

Type of payment

Cash-settled

Vesting period

January 1, 2019 ~ December 31, 2022

Date of payment

2023-01-01

Fair value (*1)

10,808 Won

Valuation method

Black-Scholes Model

Expected dividend rate

4.28%

Expected maturity date

1.5 years

Number of shares remaining

As of June 30, 2021 602,474 shares
As of December 31, 2020 602,474 shares

Number of shares granted (*2)

As of June 30, 2021 602,474 shares
As of December 31, 2020 602,474 shares

Subject to

Shares granted for the year 2020

Type of payment

Cash-settled

Vesting period

January 1, 2020 ~ December 31, 2023

Date of payment

2024-01-01

Fair value (*1)

10,356 Won

Valuation method

Black-Scholes Model

Expected dividend rate

4.28%

Expected maturity date

2.5 years

Number of shares remaining

As of June 30, 2021 944,343 shares
As of December 31, 2020 944,343 shares

Number of shares granted (*2)

As of June 30, 2021 944,343 shares
As of December 31, 2020 944,343 shares

Subject to

Shares granted for the year 2021

Type of payment

Cash-settled

Vesting period

January 1, 2021 ~ December 31, 2024

Date of payment

2025-01-01

Fair value (*1)

9,922 Won

Valuation method

Black-Scholes Model

Expected dividend rate

4.28%

Expected maturity date

3.5 years

Number of shares remaining

As of June 30, 2021 543,176 shares
As of December 31, 2020 -

Number of shares granted (*2)

As of June 30, 2021 543,176 shares
As of December 31, 2020 -
(*1)

As the amount of payment varies according to the base price (the arithmetic average of the weighted average stock price of transactions in the past one week, the past one month, and the past two months) at the date of payment, the fair value is calculated to measure the liability according to the Black Scholes model based on the base price at the time of each settlement.

(*2)

It is a system in which the amount of stock payable is determined at the beginning, and the payment rate is determined in accordance with the degree of achievement of the pre-set performance target. Performance is evaluated by long-term performance indicators such as relative shareholder return, net profit, return on equity (ROE), non-performing loan ratio, and job performance.

- 113 -

2)

The Group accounts for performance condition share-based payments according to the cash-settled method and the fair value of the liabilities is reflected in the compensation costs by re-measuring every closing period. As of June 30, 2021 and December 31, 2020, the book value of the liabilities related to the performance condition share-based payments recognized by the Group amounts to 21,681 million Won and 13,823 million Won, respectively.

35.

NON-OPERATING INCOME(EXPENSES)

(1)

Details of gains or losses on valuation of investments in joint ventures and associates are as follows (Unit: Korean Won in millions):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Gains on valuation of investments in joint ventures and associates

32,617 38,702 20,620 35,683

Losses on valuation of investments in joint ventures and associates

(794 ) (11,671 ) (3,822 ) (11,731 )

Impairment losses of investments in joint ventures and associates

9 (790 ) - -

Total

31,832 26,241 16,798 23,952
(2)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Other non-operating incomes

41,503 66,330 17,890 37,114

Other non-operating expenses

(47,677 ) (58,663 ) (152,712 ) (199,815 )

Total

(6,174 ) 7,667 (134,822 ) (162,701 )
(3)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Rental fee income

5,501 9,164 3,996 7,577

Gains on disposal of premises and equipment, intangible assets and other assets

28,886 33,345 126 6,575

Reversal of impairment loss of premises and equipment, intangible assets and other assets

(48 ) 96 20 55

Others

7,164 23,725 13,748 22,907

Total

41,503 66,330 17,890 37,114
(4)

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

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Depreciation on investment properties

837 1,411 540 1,087

Operating expenses on investment properties

383 567 158 382

Losses on disposal of premises and equipment, intangible assets and other assets

1,178 1,798 491 821

Impairment losses of premises and equipment, intangible assets and other assets

418 639 7,687 8,254

Donation

19,456 22,043 6,767 11,305

Others

25,405 32,205 137,069 177,966

Total

47,677 58,663 152,712 199,815

- 114 -

36.

INCOME TAX EXPENSE

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

For the six-month periods ended June 30
2021 2020

Current tax expense

Current tax expense with respect to the current period

399,935 180,059

Adjustments recognized in the current period in relation to the tax expense of prior periods

(18,331 ) (4,292 )

Sub-total

381,604 175,767

Deferred tax expense

Change in deferred tax assets(liabilities) due to temporary differences

111,509 66,044

Income tax expense directly attributable to equity

(12,616 ) 18,005

Sub-total

98,893 84,049

Income tax expense

480,497 259,816

Income tax expense was recognized based on the estimate of the best weighted average annual effective tax rate expected for the interim period. The weighted average annual effective tax rate for the June 30, 2021, is 23.8% (The weighted average annual effective tax rate for the June 30, 2020, is 25.1%).

- 115 -

37.

EARNINGS PER SHARE ('EPS')

(1)

Basic EPS is calculated by dividing net income attributable to common shareholders by weighted-average number of common shares outstanding (Unit: Korean Won in millions, except for EPS and number of shares):

Periods ended June 30, 2021 Periods ended June 30, 2020
Three-month Six-month Three-month Six-month

Net income attributable to common shareholders

752,595 1,419,698 142,348 660,564

Dividends to hybrid securities

(15,775 ) (31,550 ) (11,852 ) (20,365 )

Net income attributable to common shareholders

736,820 1,388,148 130,496 640,199

Weighted average number of common shares outstanding (Unit: million shares)

722 722 722 722

Basic EPS (Unit: Korean Won)

1,020 1,922 181 887
(2)

The weighted average number of common shares outstanding is as follows (Unit: number of shares, days)

For the six-month period ended June 30, 2021
Period Number of
shares 		Dates
(Unit:
Day) 		Accumulated number
of shares outstanding
during period

Common shares issued at the beginning of the period

2021-01-01 ~ 2021-06-30 722,267,683 181 130,730,450,623

Treasury stock

2021-01-01 ~ 2021-06-30 (2 ) 181 (362 )

Sub-total (①)

130,730,450,261

Weighted average number of common shares outstanding (②=(①/181)

722,267,681
For the six-month period ended June 30, 2020
Period Number of
shares 		Dates Accumulated number
of shares outstanding
during period

Common shares issued at the beginning of the period

2020-01-01 ~ 2020-06-30 722,267,683 182 131,452,718,306

Treasury stock

2020-01-01 ~ 2020-06-30 (2 ) 182 (364 )

Sub-total (①)

131,452,717,942

Weighted average number of common shares outstanding (②=(①/182)

722,267,681

Diluted EPS is equal to basic EPS because there is no dilution effect for the six-month periods ended June 30, 2021 and 2020.

- 116 -

38.

CONTINGENT LIABILITIES AND COMMITMENTS

(1)

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

June 30, 2021 December 31, 2020

Confirmed guarantees

Guarantee for loans

37,749 103,229

Acceptances

557,743 602,014

Guarantees in acceptances of imported goods

97,178 78,395

Other confirmed guarantees

6,885,062 6,491,608

Sub-total

7,577,732 7,275,246

Unconfirmed guarantees

Local letters of credit

238,209 187,146

Letters of credit

3,074,284 3,025,923

Other unconfirmed guarantees

582,906 403,652

Sub-total

3,895,399 3,616,721

Commercial paper purchase commitments and others

881,619 917,489

Total

12,354,750 11,809,456
(2)

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

June 30, 2021 December 31, 2020

Loan commitments

114,270,804 112,088,680

Other commitments (*)

7,041,920 7,827,774
(*)

As of June 30, 2021 and December 31, 2020, the amount of unsecured bills (purchase note sales) and discounts on electronic short-term bond sales (purchase) are 3,252,994 million Won and 2,894,688 million Won, respectively.

(3)

Litigation case

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

June 30, 2021 December 31, 2020
As plaintiff As defendant As plaintiff As defendant

Number of cases (*)

165 cases 478 cases 138 cases 460 cases

Amount of litigation

314,746 371,526 413,852 413,744

Provisions for litigations

22,260 24,873
(*)

The number of lawsuits as of June 30, 2021 and December 31, 2020 do not include fraud lawsuits, etc. and those lawsuits that are filed only to extend the statute of limitation.

- 117 -

(4)

Other commitments

1)

The Group decided to enter into a stock sales agreement with a major shareholder of Woori Asset Trust Co., Ltd. (formerly, Kukje Asset Trust Co., Ltd.) to acquire 44.5% of interest (58.6% of voting rights) in July 2019, and to acquire additional 21.3% of interest (28.0% of voting rights) after a certain period. As a result, the Group acquired the interest of the first sales agreement in December 2019 and is planning to acquire the interest of the second sales agreement after a certain period. In regard to this acquisition, the Group recognized 128,021 million Won as other financial liabilities for the second sales agreement.

2)

Lime Asset Management Co., Ltd. announced the suspension of redemption of many funds in operation in October 2019. The Group's total amount of sales of fund under management of Lime Asset Management Co., Ltd.'s subject to redemption suspension is 1,348 accounts and 263.8 billion Won at the end of June 2021. In December 2020, Lime Asset Management Co., Ltd.'s business registration was revoked, and funds subject to redemption suspension were transferred to Wellbridge Asset Management Co., Ltd., which was jointly established by distributors. The Financial Supervisory Service Dispute Mediation Committee was held on 23 February 2021 to discuss the incomplete sales of vendors. The consolidated company held a board meeting on March 15, 2021 to accept the decision of the Dispute Mediation Committee and resolve to expand the application of autonomous mediation, and is currently in the process of confirming the validity and compensation.

3)

As of June 30, 2021, Woori Asset Trust Co., Ltd., a subsidiary, has agreed to carry out construction completion obligations for 72 constructions, which includes the construction of residential and commercial complexes in Busan (U-dong,Haeundae-gu). Land Trust responsible for Construction and Management is a trust that bears the obligation to fulfill the responsibility of the constructor and to compensate the loan financial institution for damages if the Group fails to fulfill the construction completion obligation. As of June 30, 2021, the total PF loan amount of PF loan institutions invested in the project of the Land Trust responsible for Construction and Management is 2,019,384 million Won. Although additional losses may occur in relation to the construction completion obligations, the financial statements at June 30, 2021 do not reflect these effects since losses are unlikely and the amount cannot be estimated reliably.

4)

Pursuant to some contracts related to asset securitization, the Group utilizes various prerequisites as triggering events causing early redemption, limiting risks that investors bear due to change in asset quality. Breach of such triggering clause leads to an early redemption of the securitized bonds.

- 118 -

39.

RELATED PARTY TRANSACTIONS

Related parties of the Group as of June 30, 2021 and December 31, 2020, and assets and liabilities recognized, guarantees and commitments, major transactions with related parties and compensation to key management for the six-month periods ended June 30, 2021 and 2020 are as follows. Please see Note 12 for the details of joint ventures and associates.

(1)

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

Related parties

Account title

June 30,
2021 		December 31,
2020

Associates

W Service Networks Co., Ltd.

Loans 14 21

Deposits due to customers

2,498 2,183

Accrued expenses

6 6

Other liabilities

429 459

Korea Credit Bureau Co., Ltd.

Loans 1 1

Deposits due to customers

911 2,311

Other liabilities

- 5

Korea Finance Security Co., Ltd.

Loans 3,423 3,440

Loss allowance

(6 ) (6 )

Deposits due to customers

3,952 1,927

Other liabilities

1 1

Chin Hung International Inc.

Loans - 257

Loss allowance

- (3 )

Deposits due to customers

- 8,715

Other liabilities

- 171

LOTTE CARD Co. Ltd.

Loans 5,625 7,500

Loss allowance

(57 ) (77 )

Other assets

7 12

Deposits due to customers

12,120 2,697

Other liabilities

113 113

K BANK Co., Ltd.

Loans 62 104

Account receivables

67 26

Other assets

- 2

Well to Sea No.3 Private Equity Fund

Deposits due to customers - 4,997

Others (*1) (*2)

Loans 42,694 44,036

Loss allowance

(122 ) (126 )

Other assets

580 651

Deposits due to customers

5,743 5,831

Other liabilities

- 5
(*1)

Others include KUM HWA Co., Ltd., Aarden Woori Apparel 1st Private Equity Fund, IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, Woori G IPO10 [FI_Bal][F]C(F), Woori G Star Private Placement Investment Trust No.33 [FI], Woori G Senior Loan No.1, Woori G Clean Energy No.1, Dongwoo C & C Co., Ltd., Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori-Q Corporate Restructuring Private Equity Fund, Woori High plus G.B. Securities Feeder Fund1(G.B.), Uri Hanhwa Eureka Private Equity Fund, Japanese Hotel Real Estate Private Equity Fund 2, Cultizm Korea LTD Co., Ltd., Partner One Value Up I Private Equity Fund, Force TEC Co., Ltd., Godo Kaisha Oceanos 1 and etc., as of June 30, 2021.

(*2)

Others include Smart Private Equity Fund No.2, IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, Woori G IPO10 [FI_Bal][F]C(F), Woori G Senior Loan No.1, Woori G Egis Bond[FI][F](C(F)), Woori G Clean Energy No.1, Woori Star50 Feeder Fund(H), Dongwoo C & C Co., Ltd., Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori-Q Corporate Restructuring Private Equity Fund, Woori High plus G.B. Securities Feeder Fund1(G.B.), Uri Hanhwa Eureka Private Equity Fund, Japanese Hotel Real Estate Private Equity Fund 2, Partner One Value Up I Private Equity Fund, Godo Kaisha Oceanos 1 and etc., as of December 31, 2020.

- 119 -

(2)

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

For the six-month period ended June 30

Related parties

Account title

2021 2020

Associates

W Service Network Co., Ltd.

Other income

17 16

Interest expenses

3 9

Fees expenses

349 226

Reversal of allowance for credit loss

- (4 )

Other expenses

921 1,001

Korea Credit Bureau Co., Ltd.

Interest expenses

4 1

Fees expenses

1,746 1,544

Korea Finance Security Co., Ltd.

Interest income

38 -

Interest expenses

1 2

Provision for allowance for credit loss

- 6

Other expenses

46 51

Chin Hung International Inc

Interest expenses

- 11

Provision for allowance for credit loss

- 90

LOTTE CARD Co., Ltd.

Interest income

159 150

Fees income

4,874 1,330

Interest expenses

112 53

Reversal of allowance for credit loss

(19 ) -

K BANK Co., Ltd.

Fees income

1,025 851

Fees expenses

16 -

Well to Sea No.3 Private Equity Fund

Interest income

- 1,328

Interest expenses

- 2

Provision for allowance for credit loss

- 77

Others (*1) (*2)

Interest income

213 233

Fees income

1,483 1,261

Other income

- 8

Interest expenses

5 15

Provision for (reversal of) allowance for credit loss

(4 ) 42
(*1)

Others include Aarden Woori Apparel 1st Private Equity Fund, IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, AJU TAERIM 1st Fund, Woori G IPO10 [FI_Bal][F]C(F), Woori G Star Private Placement Investment Trust No.33 [FI], Woori G Senior Loan No.1, Woori G Clean Energy No.1, Woori Star50 Feeder Fund(H), Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori-Q Corporate Restructuring Private Equity Fund, Woori High plus G.B. Securities Feeder Fund1(G.B.), Uri Hanhwa Eureka Private Equity Fund, Japanese Hotel Real Estate Private Equity Fund 2, Partner One Value Up I Private Equity Fund, PCC-Woori LP Secondary Fund, Godo Kaisha Oceanos 1 and etc., as of June 30, 2021.

(*2)

Others include Smart Private Equity Fund No.2, IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership, AJU TAERIM 1st Fund, Woori G IPO10 [FI_Bal][F]C(F),Woori G Senior Loan No.1, Woori G Egis Bond[FI][F](C(F)), Woori G Clean Energy No.1, Woori Star50 Feeder Fund(H), Saman Corporation, Woori Growth Partnerships New Technology Private Equity Fund, Woori-Shinyoung Growth-Cap Private Equity Fund, Woori-Q Corporate Restructuring Private Equity Fund, Woori High plus G.B. Securities Feeder Fund1(G.B.), Uri Hanhwa Eureka Private Equity Fund, Japanese Hotel Real Estate Private Equity Fund 2, Partner One Value Up I Private Equity Fund, PCC-Woori LP Secondary Fund, Godo Kaisha Oceanos 1 and etc., as of June 30, 2020.

- 120 -

(3)

Major loan transactions with related parties for the six-month periods ended June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021

Related parties

Beginning
balance 		Loan Collection Others Ending
balance
(*)

Associates

W Service Network Co., Ltd. 21 121 128 - 14
Korea Credit Bureau Co., Ltd. 1 4 4 - 1
Korea Finance Security Co., Ltd. 3,440 178 195 - 3,423
LOTTE CARD Co., Ltd. 7,500 - 1,875 - 5,625
K BANK Co., Ltd. 104 933 975 - 62
Godo Kaisha Oceanos 1 44,036 - - (1,342 ) 42,694
(*)

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

For the six-month period ended June 30, 2020

Related parties

Beginning
balance 		Loan Collection Ending
balance
(*)

Associates

W Service Network Co., Ltd.

23 190 192 21

Korea Credit Bureau Co., Ltd.

3 8 10 1

Korea Finance Security Co., Ltd.

1,860 2,356 277 3,939

Chin Hung International Inc

244 1,095 1,192 147

LOTTE CARD Co., Ltd.

7,500 - - 7,500

K BANK Co., Ltd.

141 896 946 91

Well to Sea No. 3 Private Equity Fund

4,490 66,710 - 71,200
(*)

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

(4)

Details of changes in major deposits due to customers with related parties for the six-month period June 30, 2021 and 2020 are as follows (Unit: Korean Won in millions):

For the six-month period ended June 30, 2021

Related parties

Beginning
balance 		Increase Decrease Ending
balance
(*)

Associates

W Service Networks Co., Ltd

1,180 - - 1,180

Partner One Value Up I Private Equity Fund

863 637 914 586

Korea Credit Bureau Co., Ltd.

1,000 - 1,000 -
(*)

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

For the six-month period ended June 30, 2020

Related parties

Beginning
balance 		Borrowings Repayment
and others 		Ending
balance
(*1)

Associates

Saman Corporation (*2)

2,522 94 - 2,616

W Service Networks Co., Ltd

1,180 - - 1,180

Chin Hung International Inc

400 - 400 -

Partner One Value Up I Private Equity Fund

1,150 1,356 1,303 1,203

Korea Credit Bureau Co., Ltd.

- 1,000 - 1,000
(*1)

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

(*2)

Excluded from the related parties due to the loss of significant influence for the six-month period ended June 30, 2020.

(5)

There are no major borrowing transactions with related parties for the six-month periods ended June 30, 2021 and 2020.

- 121 -

(6)

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

Warrantee

June 30, 2021 December 31, 2020 Warranty

Korea Finance Security Co., Ltd.

837 820 Unused loan commitment

Korea Credit Bureau Co., Ltd.

34 34 Unused loan commitment

W Service Network Co., Ltd.

186 179 Unused loan commitment

Chin Hung International Inc.

- 16,167 Unused loan commitment

K BANK Co., Ltd.

238 196 Unused loan commitment

LOTTE CARD Co. Ltd.

500,000 500,000 Unused loan commitment

As of June 30, 2021 and December 31, 2020, the recognized payment guarantee provisions are 114 million Won and 284 million Won, respectively, in relation to the guarantees provided to the related parties above.

(7)

Amount of commitments with the related parties

Warrantee

June 30, 2021 December 31, 2020 Warranty

Together-Korea Government Private Pool Private Securities Investment Trust No. 3

- 990,000 Securities purchase commitment

IBK KIP Seongjang Dideemdol 1st Private Investment Limited Partnership

4,664 9,704 Securities purchase commitment

Woori G Senior Loan No. 1

40,050 53,041 Securities purchase commitment

Woori G Clean Energy No. 1

6,023 7,485 Securities purchase commitment

Woori Seoul Beltway Private Special Asset Fund

40,558 41,393 Securities purchase commitment

Woori-Shinyoung Growth-Cap Private Equity Fund I

2,378 12,799 Securities purchase commitment

Woori-Q Corporate Restructuring Private Equity Fund

36,355 36,355 Securities purchase commitment

Union Technology Finance Investment Association

4,500 10,500 Securities purchase commitment

Genesis Eco No. 1 Private Equity Fund

1,296 - Securities purchase commitment

Genesis Environmental Energy Company 1st Private Equity Fund

916 916 Securities purchase commitment

JC Assurance No. 2 Private Equity Fund

1,351 1,650 Securities purchase commitment

Crevisse Raim Impact 1st Startup Venture Specialist Private Equity Fund

488 550 Securities purchase commitment

PCC-Woori LP Secondary Fund

- 2,525 Securities purchase commitment
(8)

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

For the six-month period ended
June 30
2021 2020

Short-term employee salaries

10,335 8,084

Retirement benefit service costs

409 311

Share-based compensation

3,079 1,054

Total

13,823 9,449

Key management includes executives and directors of Woori Financial Group and major subsidiaries, and also includes CEO of other subsidiaries. Outstanding assets from transactions with key management amount to 3,576 million Won and 3,888 million Won, as of June 30, 2021 and December 31, 2020, respectively and with respect to the assets, the Group has not recognized any allowance nor related impairment loss due to credit losses. Also, liabilities from transaction with key management amount to 12,995 million Won and 11,155 million Won, respectively, as of June 30, 2021 and December 31, 2020.

- 122 -

40.

LEASES

(1)

Lessor

1)

Finance lease

①

The total investment in finance lease and the present value of the minimum lease payments to be recovered are as follows (Unit: Korean Won in millions):

June 30, 2021
Total investment in lease Net investment in lease

Within one year

45,432 44,203

After one year but within two years

85,409 79,693

After two years but within three years

192,757 175,280

After three years but within four years

280,326 251,129

After four years but within five years

449,155 397,566

After five years

44 35

Total

1,053,123 947,906
December 31, 2020
Total investment in lease Net investment in lease

Within one year

24,649 23,957

After one year but within two years

48,781 45,575

After two years but within three years

132,894 120,414

After three years but within four years

171,137 151,756

After four years but within five years

277,282 244,481

After five years

16 12

Total

654,759 586,195
②

The unrealized interest income of the finance lease is as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Total investment in lease

1,053,123 654,759

Net investment in lease

947,906 586,195

Present value of minimum lease payments

947,906 586,133

Present value of unguaranteed residual value

- 62

Unearned interest income

105,217 68,564
2)

Operating lease

①

The details of operating lease assets are as follows (Unit: Korean Won in millions):

June 30, 2021 December 31, 2020

Prepaid lease assets

3,272 199

Operating lease assets

Acquisition cost

1,749,061 1,506,957

Accumulated depreciation

(439,659 ) (390,981 )

Net carrying value

1,309,402 1,115,976

Total

1,312,674 1,116,175

- 123 -

②

The details of changes in operating lease assets as of June 30, 2021 are as follows and there is no details of changes in operating lease assets as of June 30, 2020 (Unit: Korean Won in millions):

Amount

Beginning balance

1,116,175

Acquisition

349,216

Disposal

(48,682 )

Depreciation

(112,279 )

Others

4,972

Ending balance

1,309,402
③

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

June 30, 2021 December 31, 2020

Within one year

281,821 240,005

After one year but within two years

258,541 223,074

After two years but within three years

179,794 156,859

After three years but within four years

102,071 80,174

After four years but within five years

41,582 24,992

Total

863,809 725,104
④

There is no adjusted lease payments recognized as profit or loss for the six-month periods ended June 30, 2021 and 2020.

(2)

Lessee

1)

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

June 30, 2021 December 31, 2020

Lease payments

Within one year

156,276 173,885

After one year but within five years

150,455 200,844

After five years

37,241 34,787

Total

343,972 409,516
2)

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

For the six-month periods ended
June 30
2021 2020

Total cash outflows from lease

93,758 103,985
3)

Details of lease payments that are not included in the measurement of lease liabilities due to the fact that they are short-term leases or leases for which the underlying asset is of low value are as follows (Unit: Korean Won in millions):

For the six-month periods ended
June 30
2021 2020

Lease payments for short-term leases

814 743

Lease payments for which the underlying asset is of low value

721 274

Total

1,535 1,017
4)

The Group uses a practical expedient for rent concession as a direct consequence of COVID-19. Accordingly, the amount recognized in profit or loss during the reporting period is 19,311 million Won, to reflect changes in lease payments arising from the rent concession.

- 124 -

41.

EVENTS AFTER THE REPORTING PERIOD

(1)

On June 4, 2021, the Group signed a share exchange agreement to exchange 1.0567393 share of Woori Financial Group Inc. for 1 share of each shareholders (excluding the Group) of Woori Financial Capital Co., Ltd. on August 10, 2021. On July 23, 2021, the Board of Directors on behalf of the shareholders' meeting of the Group and Woori Financial Capital Co., Ltd. approved the comprehensive exchange of shares under the above share exchange agreement and share exchange contract amendment. The Company's new shares will go on public on August 27, 2021.

(2)

On July 23, 2021, the Board of Directors resolved to pay an interim dividend of 150 Won per share (total dividend of 108,340 million Won) with July 30, 2021 as the dividend base date.

- 125 -

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Woori Financial Group Inc. published this content on 17 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 August 2021 10:53:04 UTC.