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01/10 15:44
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call highlights strong financial performance, with net income and non-interest income showing significant growth. The shareholder return plan, including dividend approval, is a positive indicator. Despite some uncertainties in market conditions and supply chain challenges, the group maintains a stable CET1 ratio and targets further improvements. The Q&A section reveals confidence in achieving financial targets, though some responses lacked clarity. Overall, the positive financial metrics and shareholder return announcements outweigh concerns, suggesting a positive stock price movement in the short term.
Net Income KRW2.6591 trillion, up 9.1% year-on-year; increase attributed to strong revenue generation capabilities and stable cost management.
Quarterly Net Income (Q3) KRW903.6 billion; slight decrease from previous quarter but above KRW900 billion for two consecutive quarters, exceeding market expectations.
Net Operating Revenue KRW7.9927 trillion, up 6.6% year-on-year; stable performance despite margin contraction due to falling market interest rates, supported by strong asset growth and increased non-interest income.
Quarterly Net Operating Revenue (Q3) KRW2.7122 trillion; in line with previous quarter.
Credit Costs KRW1.2546 trillion, up 6.3% year-on-year; increase due to sluggish domestic demand and prolonged high interest rates.
Credit Cost Ratio 0.44%; reflects the rise in current credit costs.
NPL Ratio 0.55% for the Group, 0.21% for the bank; indicates asset quality.
NPL Coverage Ratio 152% for the Group, 270% for the bank; among the healthiest in the industry.
CET1 Ratio 12%; stable compared to previous quarter due to strong asset growth.
Cumulative Interest Income (Q3) KRW6.6146 trillion; maintained same level as previous year despite narrowing margins.
Total Loans KRW340 trillion, up 5% from end of June; growth driven by corporate and household loans.
Total Deposits KRW327 trillion, up 5.5% from June; growth in core deposits was weak due to high demand for time deposits.
Non-Interest Income KRW1.3781 trillion, up 53.2% year-on-year; significant profit growth from marketable securities and fees.
SG&A KRW3.1581 trillion, up 3.4% year-on-year; Q3 alone was KRW1.0571 trillion, a slight decrease of 1.1% from previous quarter.
CIR (Cost-to-Income Ratio) 39.6%; below 40% for two consecutive quarters.
Quarterly Credit Cost (Q3) KRW479.1 billion, up 17.1% quarter-on-quarter; increase due to higher delinquency rates.
New Product Launch: In August, Woori Financial Group merged Woori Investment Bank and F&I Securities to relaunch Woori Investment Securities.
Digital Services: By year-end, Woori Investment Securities plans to launch a new service through its fund super-market application, with an integrated super app expected by the second half of next year.
Market Positioning: The Group has been included in the Korea Value-up Index, indicating heightened interest from overseas investors.
Dividend Policy: The Board approved a cash dividend of KRW181 per share, with discussions ongoing for equal distribution of dividends in 2025.
Cost Management: The Group's cost-to-income ratio (CIR) remained below 40% for two consecutive quarters, achieving 39.6% in Q3 2024.
Credit Costs: Cumulative credit costs increased by 6.3% year-on-year, with a focus on managing risk factors and maintaining asset quality.
Capital Management: The Group aims to achieve a CET1 ratio of 12.5% by early 2025, focusing on asset management and growth.
Revenue Diversification: The Group's non-interest income increased by 53.2% year-on-year, driven by favorable market conditions and efforts to diversify revenue streams.
Credit Costs: Cumulative credit costs increased by 6.3% year-on-year, with a significant 17.1% quarter-on-quarter rise due to sluggish domestic demand and high interest rates, leading to higher delinquency rates.
NPL Ratio: The NPL ratio stood at 0.55% for the Group, indicating potential asset quality concerns amid rising credit costs.
Margin Compression: Declining market interest rates have led to margin compression, with the Group's NIM declining by 7 basis points to 1.40% in Q3.
Economic Uncertainty: Concerns regarding geopolitical risks, U.S. Presidential elections, and potential economic slowdown are causing uncertainty in both domestic and international markets.
Core Deposits: Weak growth in core deposits due to high demand for time deposits, which may impact the Group's ability to defend margins.
CET1 Ratio Management: The Group aims to improve its CET1 ratio to 12.5% by early 2025, facing challenges from fluctuating foreign exchange rates and regulatory changes.
Cost Management: Despite efforts to control costs, the Group anticipates an increase in the cost-to-income ratio due to ongoing investments in IT and brand value.
Insurance Acquisition Risks: Concerns regarding the capital adequacy of ABL Insurance, with potential needs for capital injection due to declining kick ratios.
CET1 Ratio Target: The Group aims to achieve a CET1 ratio of 12.5% by early 2025, with a focus on asset management and capital ratio improvement.
Value-Up Plan: The Group is implementing a corporate value-up plan, which has garnered increased interest from overseas investors and inclusion in the Korea Value-up Index.
Non-Interest Income Diversification: Woori Financial Group is expanding efforts to diversify non-interest income sources, including the merger of Woori Investment Bank and F&I Securities.
Core Deposits Strategy: The Group is implementing over 30 measures to increase core deposits, targeting a significant increase in core deposits in the upcoming year.
Q4 NIM Outlook: The Group expects to maintain NIM around Q3 levels in Q4, with proactive asset and capital management.
2025 NIM Projection: For 2025, the Group anticipates NIM to be around high 1.3%, with efforts to manage asset growth and defend margins.
Dividend Policy for 2025: The Group will discuss the possibility of equal distribution of dividends across quarters in 2025 with the Board of Directors.
Credit Cost Projections: Credit costs are expected to remain stable in the current year, with gradual improvement anticipated next year as the real estate market stabilizes.
Cash Dividend: The Board of Directors approved a cash dividend of KRW181 per share.
Shareholder Return Plan: The Group aims to achieve a CET1 ratio of 12.5% by early 2025, with a focus on improving capital management and enhancing shareholder value.
Dividend Policy: The Group's quarterly dividend policy considers market expectations, with discussions for equal distribution of dividends across quarters in 2025.
The earnings call shows stable financial performance with solid interest income and improved noninterest income. The company is focused on strengthening competitiveness and managing capital efficiently. While there are some uncertainties, such as unclear management responses and increased credit costs, the overall sentiment is positive due to strategic growth plans, strong capital ratios, and shareholder return initiatives. The market is likely to react positively, especially with the optimistic guidance and focus on cost efficiency and revenue stability.
The earnings call shows mixed signals. Positive elements include increased dividends, share buybacks, and strong noninterest income growth. However, net income missed expectations, and SG&A expenses rose significantly. The Q&A revealed uncertainties in strategic decisions and unclear management responses, particularly concerning the insurance arm and CET1 ratio target. These factors suggest a neutral market reaction, as positive shareholder returns and growth in noninterest income may offset concerns about missed earnings and rising expenses.
The earnings call highlights several negative factors: increased credit costs, SG&A expenses, and asset quality concerns due to economic uncertainties. Despite some positive aspects like increased dividends and share buybacks, the overall sentiment remains negative due to regulatory challenges, high exchange rates, and unclear management responses in the Q&A section. The lack of strong guidance and the impact of U.S. tariffs further contribute to a negative outlook. The stock price is likely to decline by 2% to 8% over the next two weeks.
The earnings call highlights strong financial performance, with net income and non-interest income showing significant growth. The shareholder return plan, including dividend approval, is a positive indicator. Despite some uncertainties in market conditions and supply chain challenges, the group maintains a stable CET1 ratio and targets further improvements. The Q&A section reveals confidence in achieving financial targets, though some responses lacked clarity. Overall, the positive financial metrics and shareholder return announcements outweigh concerns, suggesting a positive stock price movement in the short term.
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