Woori Financial (WF)2023-03-07 17:37Financial Position - As of December 31, 2022, loans measured at amortized cost amount to 346,252,713 million won, with allowances for credit losses of 2,334,153 million won[10]. - The Group's consolidated financial statements present a fair view of its financial position as of December 31, 2022, in accordance with Korean IFRS[4]. - Total assets increased to 480,474,396 million Korean Won in 2022, up from 447,183,871 million in 2021, representing a growth of approximately 7.3%[32]. - Total liabilities increased to 448,847,054 million Korean Won in 2022, up from 418,333,676 million in 2021, marking a rise of 7.3%[32]. - The total comprehensive income for 2022 was 3,084,163 million Korean Won, slightly up from 2,977,552 million in 2021, an increase of 3.6%[36]. - The total assets of the company as of December 31, 2022, were 31,627,342 million Korean Won, compared to 28,850,195 million Korean Won in 2021, indicating a growth of 9.7%[42]. Income and Earnings - Net income for 2022 was 3,323,982 million Korean Won, a 18.3% increase from 2,807,371 million in 2021[35]. - The company reported a basic and diluted earnings per share of 4,191 Korean Won in 2022, compared to 3,481 Korean Won in 2021, indicating an increase of 20.4%[37]. - Net interest income rose to 8,696,579 million Korean Won in 2022, compared to 6,985,721 million in 2021, reflecting a growth of 24.5%[35]. - Fees and commissions income grew to 2,499,700 million Korean Won in 2022, up from 2,171,705 million in 2021, a rise of 15.0%[35]. - Interest income for 2022 was 14,189,016 million Korean Won, compared to 9,351,055 million Korean Won in 2021, showing a growth of 51.5%[43]. - The total comprehensive income for 2022 reached 31,627,342 million Korean Won, up from 28,850,195 million Korean Won in 2021, reflecting a growth of 9.7%[42]. Cash Flow and Management - Cash inflow from operating activities in 2022 was 18,624,119 million Korean Won, significantly higher than 3,799,743 million Korean Won in 2021[44]. - The company reported a net cash outflow from investing activities of 6,968,690 million Korean Won in 2022, compared to 10,666,859 million Korean Won in 2021, indicating improved cash management[45]. - Cash and cash equivalents at the end of 2022 were 34,219,148 million Korean Won, up from 20,613,073 million Korean Won at the end of 2021, representing a 65.8% increase[44]. - The Group's cash and cash equivalents increased significantly from 13,047,255 million KRW in 2021 to 22,965,162 million KRW in 2022, marking an increase of 76.5%[92]. - Cash flows from operating activities rose from 5,600,710 million KRW in 2021 to 9,981,310 million KRW in 2022, an increase of 78.5%[93]. Credit Losses and Risk Management - The audit identified expected credit losses on loans as a key audit matter, requiring significant management judgment and estimation[9]. - The Group's expected credit loss model includes both individual and collective assessments, reflecting complex variables and assumptions[9]. - The audit confirmed that the methodologies used for estimating expected credit losses were based on sufficient and reasonable historical data[16]. - The Group's management recognized lifetime expected credit losses on loans with significant increases in credit risk[12]. - The Group recognizes loss allowance on expected credit losses for financial assets, measured by incorporating current conditions and forecasts of future economic conditions[192]. Subsidiaries and Investments - As of December 31, 2022, Woori Financial Group fully owns 12 subsidiaries, including Woori Bank and Woori Card Co., Ltd., with ownership percentages ranging from 58.7% to 100%[54]. - Woori Financial Group's subsidiaries operate in various sectors, including banking, finance, asset management, and credit information services[54]. - The Group's investment strategy includes a focus on structured entities for asset securitization and securities investment[63]. - The total assets of unconsolidated structured entities held by the Group amounted to 14,856,750 million won for asset securitization, 82,724,618 million won for structured finance, 132,264,383 million won for investment funds, and 1,316,930 million won for real estate trust as of December 31, 2022[80]. - The Group's maximum exposure to risks from unconsolidated structured entities was 8,153,111 million won for asset securitization, 6,086,831 million won for structured finance, 9,322,308 million won for investment funds, and 92,856 million won for real estate trust[80]. Accounting Policies and Standards - The Group's accounting policy changes regarding cash equivalents resulted in a retrospective increase in cash and cash equivalents by 22,965,162 million KRW as of December 31, 2022[92]. - The amendments to K-IFRS 1103 regarding business combinations did not have a significant impact on the financial statements, indicating stability in accounting practices[94]. - The Group does not expect significant impacts from the newly issued K-IFRS standards effective from January 1, 2023, suggesting a stable outlook for compliance costs[99]. - The Group's approach to business combinations emphasizes the acquisition method, ensuring fair value recognition of acquired assets and liabilities[109]. - Non-controlling interests are measured at fair value at the acquisition date, reflecting the proportional interest in changes in equity post-acquisition, which is crucial for financial reporting accuracy[112]. Revenue Recognition - The Group recognizes revenue from contracts with customers when a performance obligation is satisfied, with transaction prices allocated accordingly[136]. - Fees and commission received for brokerage primarily come from Banking segment activities, with significant contributions from bancassurance and beneficiary certificates[137]. - Revenue from electronic finance services is recognized immediately upon service completion, significantly contributing to Banking and Investment banking segments[139]. - The Group accounts for joint ventures and associates using the equity method, recognizing its share of net assets and any impairment[121]. - Loan origination fees are accounted for as deferred origination fees, impacting interest income calculations using the effective interest rate method[154].