Risk management

12 Months Ended

Dec. 31, 2025

Disclosure of risk management [Abstract]

4. RISK MANAGEMENT

The Group is exposed to various risks that may arise from its operating activities, and the main types of risks are credit risk, market risk, liquidity risk and etc. The Risk Management Organization analyzes and assesses 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 Board Risk Management Committee, Chief Risk Officer (CRO), and Risk Management Department. The Board of Directors operates a Board Risk Management Committee comprised of outside directors for professional risk management. The Board 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 Chief Risk Officer (CRO) assists the Board 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

To measure credit risk, the Group considers the possibility of failure in performing the obligation by the 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 rating, other than quantitative methods utilizing financial statements and others, and assessor’s judgement, the Group utilizes credit rating derived using statistical methods.

In order to manage credit risk limit, the Group establishes the appropriate credit line per obligor, company or industry by monitoring 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 purchase of credit derivatives that have low correlation with the obligor’s credit status. The Group has adopted the comprehensive 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.

2) Measurement of expected credit loss

IFRS 9 requires entities to measure loss allowance equal to 12-month expected credit losses or lifetime expected credit losses after classifying financial assets into one of the three stages, depending on the degree of increase in credit risk since their initial recognition.


Classification	Stage 1	Stage 2	Stage 3
Definition	No significant increase in credit risk after initial recognition (*)	Significant increase in credit risk after initial recognition	Credit-impaired
Loss allowance	12-month expected credit losses	Lifetime expected credit losses
Loss allowance	Expected credit losses that result from those default events on the financial instrument that are possible within 12 months after the reporting date	Expected credit losses that result from all possible default events over the life of the financial instrument

(*)	If the financial instrument has low credit risk at the end of the reporting period, the Group may assume that the credit risk has not increased significantly since initial recognition.

At the end of each reporting period the Group assesses whether credit risk has significantly increased since the date of initial recognition. The Group assesses whether the credit risk has increased significantly since initial

recognition by using credit rating, asset quality level, early warning system, days past due and others. For financial assets whose contractual cash flows have been modified, the Group assesses whether there is a significant increase in credit risk on the same basis.

The Group performs the assessment below to both corporate and retail exposures, and indicators of significant increase in credit risk are as follows:


Corporate Exposures		Retail Exposures
Asset quality level ‘Precautionary’ or lower		Asset quality level ‘Precautionary’ or lower
More than 30 days past due		More than 30 days past due
‘Warning’ level in early warning system		Significant decrease in credit rating
Debtor experiencing financial difficulties (Capital impairment, Adverse opinion or Disclaimer of opinion by external auditors)		Deferment of repayment of principal and interest
Significant decrease in credit rating		Deferment of interest
Deferment of repayment of principal and interest
Deferment of interest

The Group concludes that credit is impaired when financial assets are under conditions stated below:

•

When principal and interest of loan is overdue for 90 days or longer due to significant deterioration in credit

•

For loans overdue for less than 90 days, when it is determined that not even a portion of the loan will be recovered unless claim actions such as disposal of collaterals are taken

•

When other objective indicators of impairment have been noted for the financial asset.

The Group also incorporates forward looking into the estimates of default rates and loss given default. Considering the potential for latent insolvency due to increased internal and external economic uncertainties, the Group adjusts the forward looking to additionally recognize expected credit loss allowance.

The Group has estimated the allowance for credit losses using an estimation model that additionally reflects the forward-looking information based on the past experience loss rate data.

Loss allowance is calculated by applying PD (Probability of Default) and LGD (Loss Given Default) estimated for each financial asset in consideration of factors such as obligor type, credit rating and portfolio. The estimates are regularly reviewed in order to reduce discrepancies with actual losses.

In measuring the expected credit losses, the Group is also using reasonable and supportable macroeconomic variables such as gross domestic product (real, original series) growth rate, consumer price index, apartment sales price index (KB, Seoul) and unemployment rate (original series) in order to forecast future economic conditions.

The Group applies a future economic situation estimation model as follows, and the results are reviewed regularly.

•

Development of estimation models through regression analysis of obligator (corporate, retail)/by-period and collateral (credit, collateral)/by-period recover rate in the event of default (1- Loss Given Default) and macroeconomic indicator data by year


Major macroeconomic indicators		Correlation between credit risk and macroeconomic indicators
Gross domestic product (real, original series) growth rate		Negative(-) Correlation
Average capacity utilization rate for manufacturing		Negative(-) Correlation
Unemployment rate (original series)		Positive(+) Correlation
Apartment sales price index (KB, Seoul)		Negative(-) Correlation
KOSPI		Negative(-) Correlation
Gross domestic income (GDI)		Negative(-) Correlation
Retail sales index		Negative(-) Correlation
Actual apartment sales price index (Seoul Metropolitan Area)		Negative(-) Correlation
KOSDAQ		Negative(-) Correlation

Calculation of estimated default rate and estimated default recovery rate by incorporating future economic outlook using utilizing economic variable forecasts derived from various methods: 1) Economic variable forecasts provided by institutions verified to be reliable such as the Bank of Korea (BOK), Korea Development Institute (KDI), and Korea Institute of Finance (KIF); 2) Forecasts derived from external institutions and regression analysis results; 3) Economic variable forecasts derived through time series trends, etc., to the estimation model developed as a result of modeling.

As of December 31, 2025, the probability weights applied to the scenarios of the forecasts of macroeconomic variables is as follows (Unit: %):


	Normal Scenario		Good Scenario		Bad Scenario		Worst Scenario
Probability weight		45.58		5.69		28.73		20.00

The increase rate from the predicted default rate and predicted recovery rate is used as a forward-looking adjustment coefficient and reflected to the applicable estimate for the current year.

Considering internal and external uncertainties, The Group additionally applied the Worst scenario to the three macroeconomic variable scenarios: Normal, Good, and Bad. Assuming all other conditions remain the same, the sensitivity analysis of the Group’s expected credit loss allowance, assuming a probability weighting of 100% for each scenario, are as follows (Unit: Korean Won in millions):


Scenario	Applied probability weight			Assuming 100%		Difference from book value
Good		5.69	%		1,280,714		(675,757	)
Normal		45.58	%		1,394,081		(562,390	)
Bad		28.73	%		1,796,726		(159,745	)
Worst		20.00	%		4,255,128		2,298,657

3) 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 carrying amount after allowances and other credit enhancements. However, the maximum exposure is the fair value amount (recorded in 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 December 31, 2024 and 2025 is as follows (Unit: Korean Won in millions):


		December 31, 2024		December 31, 2025
Loans and other financial assets at amortized cost (*1)	Korean treasury and government agencies		229,126		538,314
	Banks		23,593,313		23,189,957
	Corporates		179,986,851		188,753,434
	Consumers		194,662,526		200,014,078

	Sub-total		398,471,816		412,495,783

Financial assets at FVTPL (*2)	Deposits		73,951		261,470
	Debt securities		6,801,288		9,552,081
	Loans		104,177		1,126,446
	Derivative assets		10,094,532		5,774,203
	Others		2,671		156,134

	Sub-total		17,076,619		16,870,334

Financial assets at FVTOCI	Debt securities and others		42,922,671		82,071,637
Securities at amortized cost	Debt securities		19,203,177		18,707,459
Derivative assets	Derivative assets (Designated for hedging)		175,191		217,180
Off-balance accounts	Payment guarantees (*3)		16,611,262		16,070,098
	Loan commitments		133,863,588		134,286,067

	Sub-total		150,474,850		150,356,165

	Total		628,324,324		680,718,558

(*1)	Cash and cash equivalents are not included.

(*2)	Puttable financial instruments are not included.

(*3)	As of December 31, 2024 and 2025, the financial guarantee amount of 4,156,790 million Won and 5,032,808 million Won are included, respectively.

a) Credit risk exposure by geographical areas

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


	December 31, 2024
	Korea		China		USA		UK		Japan		Others (*)		Total
Loans and other financial assets at amortized cost		367,026,768		5,784,272		7,108,462		584,060		850,872		17,117,382		398,471,816
Securities at amortized cost		18,052,871		197,188		712,761		—		—		240,357		19,203,177
Financial assets at FVTPL		12,643,738		88		1,824,414		553,842		430,341		1,624,196		17,076,619
Financial assets at FVTOCI		37,746,319		589,277		3,157,655		190,801		22,112		1,216,507		42,922,671
Derivative assets (Designated for hedging)		165,089		—		3,216		—		6,886		—		175,191
Off-balance accounts		144,006,247		1,213,479		1,805,060		87,755		20,758		3,341,551		150,474,850

Total		579,641,032		7,784,304		14,611,568		1,416,458		1,330,969		23,539,993		628,324,324

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


	December 31, 2025
	Korea		China		USA		UK		Japan		Others (*)		Total
Loans and other financial assets at amortized cost		381,895,446		5,455,324		6,700,018		775,262		1,266,134		16,403,599		412,495,783
Securities at amortized cost		17,720,610		55,390		779,676		—		—		151,783		18,707,459
Financial assets at FVTPL		14,030,387		32		1,151,755		502,905		277,765		907,490		16,870,334
Financial assets at FVTOCI		70,443,271		1,102,112		4,752,496		400,316		591,861		4,781,581		82,071,637
Derivative assets (Designated for hedging)		180,170		—		30,719		—		6,291		—		217,180
Off-balance accounts		142,669,598		1,069,795		1,439,439		756,252		35,333		4,385,748		150,356,165

Total		626,939,482		7,682,653		14,854,103		2,434,735		2,177,384		26,630,201		680,718,558

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

b) Credit risk exposure by industries

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 December 31, 2024 and 2025 (Unit: Korean Won in millions):


	December 31, 2024
	Service		Manufacturing		Finance and insurance		Construction		Individuals		Others		Total
Loans and other financial assets at amortized cost		92,018,694		47,835,603		33,986,585		6,219,603		190,902,940		27,508,391		398,471,816
Securities at amortized cost		169,352		—		10,248,257		59,866		—		8,725,702		19,203,177
Financial assets at FVTPL		287,401		539,092		10,833,850		31,527		123,339		5,261,410		17,076,619
Financial assets at FVTOCI		331,590		474,837		29,935,898		194,940		—		11,985,406		42,922,671
Derivative assets (Designated for hedging)		—		—		175,191		—		—		—		175,191
Off-balance accounts		22,460,440		28,514,078		14,147,757		3,192,714		73,212,057		8,947,804		150,474,850

Total		115,267,477		77,363,610		99,327,538		9,698,650		264,238,336		62,428,713		628,324,324



	December 31, 2025
	Service		Manufacturing		Finance and insurance		Construction		Individuals		Others		Total
Loans and other financial assets at amortized cost		88,350,901		52,551,867		40,292,287		5,754,395		196,402,459		29,143,874		412,495,783
Securities at amortized cost		89,611		—		8,009,336		39,968		—		10,568,544		18,707,459
Financial assets at FVTPL		498,155		677,238		9,126,225		145,149		100		6,423,467		16,870,334
Financial assets at FVTOCI		388,717		1,308,907		39,468,777		867,980		—		40,037,256		82,071,637
Derivative assets (Designated for hedging)		—		—		217,180		—		—		—		217,180
Off-balance accounts		24,121,840		25,922,599		14,542,861		3,533,170		73,040,583		9,195,112		150,356,165

Total		113,449,224		80,460,611		111,656,666		10,340,662		269,443,142		95,368,253		680,718,558

4) 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 December 31, 2024 and 2025 is as follows (Unit: Korean Won in millions):


	December 31, 2024
	Stage 1				Stage 2
	Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Stage 3		Credit impairment model		Total		Loss allowance			Total, net
Loans and other financial assets at amortized cost		343,186,708		27,086,126		13,280,849		14,344,066		3,003,886		1,147,147		402,048,782		(3,576,966	)		398,471,816
Korean treasury and government agencies		229,733		22		—		—		—		—		229,755		(629	)		229,126
Banks		23,375,096		115,721		88,306		—		36,143		—		23,615,266		(21,953	)		23,593,313
Corporates		150,732,338		19,561,385		3,130,814		6,264,461		1,416,152		1,147,147		182,252,297		(2,265,446	)		179,986,851
General business		103,495,951		11,071,283		2,507,705		4,093,868		807,545		—		121,976,352		(1,409,387	)		120,566,965
Small- and medium-sized enterprise		35,450,353		7,731,142		500,934		1,870,087		357,881		—		45,910,397		(586,059	)		45,324,338
Project financing and others		11,786,034		758,960		122,175		300,506		250,726		1,147,147		14,365,548		(270,000	)		14,095,548
Consumers		168,849,541		7,408,998		10,061,729		8,079,605		1,551,591		—		195,951,464		(1,288,938	)		194,662,526
Securities at amortized cost		19,213,940		—		—		—		—		—		19,213,940		(10,763	)		19,203,177
Financial assets at FVTOCI (*3)		42,766,477		156,194		—		—		—		—		42,922,671		(29,084	)		42,922,671

Total		405,167,125		27,242,320		13,280,849		14,344,066		3,003,886		1,147,147		464,185,393		(3,616,813	)		460,597,664


	December 31, 2024
	Collateral value
	Stage 1		Stage 2		Stage 3		Credit impairment model		Total
Loans and other financial assets at amortized cost		241,378,580		22,815,602		1,070,209		1,137,097		266,401,488
Korean treasury and government agencies		55,775		—		—		—		55,775
Banks		2,474,302		—		—		—		2,474,302
Corporates		101,666,963		7,536,068		645,842		1,137,097		110,985,970
General business		59,099,372		5,578,709		328,802		—		65,006,883
Small- and medium-sized enterprise		34,401,736		1,729,820		243,513		—		36,375,069
Project financing and others		8,165,855		227,539		73,527		1,137,097		9,604,018
Consumers		137,181,540		15,279,534		424,367		—		152,885,441
Securities at amortized cost		—		—		—		—		—
Financial assets at FVTOCI (*3)		—		—		—		—		—

Total		241,378,580		22,815,602		1,070,209		1,137,097		266,401,488

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

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

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


	December 31, 2025
	Stage 1				Stage 2
	Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Stage 3		Credit impairment model		Total		Loss allowance			Total, net
Loans and other financial assets at amortized cost		354,069,178		30,632,768		13,842,896		12,837,364		3,564,522		1,137,650		416,084,378		(3,588,595	)		412,495,783
Korean treasury and government agencies		539,215		—		—		—		—		—		539,215		(901	)		538,314
Banks		22,832,170		380,843		—		—		—		—		23,213,013		(23,056	)		23,189,957
Corporates		155,984,903		23,571,082		3,177,635		5,395,186		1,733,385		1,137,650		190,999,841		(2,246,407	)		188,753,434
General business		107,006,628		14,727,532		2,404,812		3,754,332		1,102,892		—		128,996,196		(1,518,049	)		127,478,147
Small- and medium-sized enterprise		33,828,252		8,118,497		542,006		1,469,338		368,686		—		44,326,779		(456,931	)		43,869,848
Project financing and others		15,150,023		725,053		230,817		171,516		261,807		1,137,650		17,676,866		(271,427	)		17,405,439
Consumers		174,712,890		6,680,843		10,665,261		7,442,178		1,831,137		—		201,332,309		(1,318,231	)		200,014,078
Securities at amortized cost		18,718,526		—		—		—		—		—		18,718,526		(11,067	)		18,707,459
Financial assets at FVTOCI (*3)		81,911,940		159,697		—		—		—		—		82,071,637		(29,204	)		82,071,637

Total		454,699,644		30,792,465		13,842,896		12,837,364		3,564,522		1,137,650		516,874,541		(3,628,866	)		513,274,879


	December 31, 2025
	Collateral value
	Stage 1		Stage 2		Stage 3		Credit impairment model		Total
Loans and other financial assets at amortized cost		242,664,753		22,382,806		1,219,109		1,128,343		267,395,011
Korean treasury and government agencies		103,817		—		—		—		103,817
Banks		1,815,479		—		—		—		1,815,479
Corporates		99,471,630		7,066,546		720,305		1,128,343		108,386,824
General business		61,218,056		5,128,816		516,966		—		66,863,838
Small- and medium-sized enterprise		26,662,910		1,594,623		142,383		—		28,399,916
Project financing and others		11,590,664		343,107		60,956		1,128,343		13,123,070
Consumers		141,273,827		15,316,260		498,804		—		157,088,891
Securities at amortized cost		—		—		—		—		—
Financial assets at FVTOCI (*3)		—		—		—		—		—

Total		242,664,753		22,382,806		1,219,109		1,128,343		267,395,011

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

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

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

b) Payment Guarantees and commitments

The credit quality of the payment guarantees and loan commitments as of December 31, 2024 and 2025 are as follows (Unit: Korean Won in millions):


	December 31, 2024
Financial assets	Stage 1				Stage 2				Stage3		Total
Financial assets	Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Stage3		Total
Off-balance accounts:
Payment Guarantees		15,679,374		808,182		41,866		59,688		22,152		16,611,262
Loan Commitments		127,622,889		3,402,602		2,298,056		502,070		37,971		133,863,588

Total		143,302,263		4,210,784		2,339,922		561,758		60,123		150,474,850

(*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, 2025
Financial assets	Stage 1				Stage 2				Stage 3		Total
Financial assets	Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Above appropriate credit rating (*1)		Less than a limited credit rating (*2)		Stage 3		Total
Off-balance accounts:
Payment Guarantees		15,186,145		776,039		18,603		66,204		23,107		16,070,098
Loan Commitments		127,446,436		3,821,389		2,461,016		521,696		35,530		134,286,067

Total		142,632,581		4,597,428		2,479,619		587,900		58,637		150,356,165

(*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.

5) Collateral and other credit enhancements

For the years ended December 31, 2024 and 2025, 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.

6) Among financial assets that measured loss allowance at lifetime expected credit losses, amortized costs before changes in contractual cash flows as of December 31, 2024 and 2025 are 153,361 million Won and 107,905 million Won, respectively, with net losses recognized along with the changes 15,335 million Won and 6,951 million Won, respectively.

7) The Group determines which loan is subject to write-off in accordance with internal guidelines and writes off loan receivables when it is determined that the loans are practically irrecoverable. For example, loans are practically irrecoverable when application is made for rehabilitation under the Debtor Rehabilitation and Bankruptcy Act and loans are confirmed as irrecoverable by the court’s decision to waive debtor’s obligation, or when it is impossible to recover the loan amount through legal means such as auctioning of debtor’s assets or through any other means of recovery available.

As the Group manages receivables that have not lost the right of claim to the debtor for the grounds of incomplete statute limitation and uncollected receivables under the related laws as receivable charge-offs, the balance as of December 31, 2024 and 2025 are 9,018,290 million Won and 9,904,152 million Won. In addition, the contractual non-recoverable amount of financial assets amortized for the year ended December 31, 202

, but still in the process of recovery is 2,018,638 million Won.

(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, measuring its level, and evaluating the appropriateness of the level of accepted market risks for both trading and non-trading activities.

a) Trading activities

The Group uses the standard approach and internal model approach (Woori Bank) in measuring market risk for trading positions, and allocates market risk capital through the Board 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 Board Risk Management Committee.

Subsidiaries such as Woori Bank manage market internal capital limits using the Basel III standard approach, and other subsidiaries manage market risks by applying the simple method.

The Basel III standard approach consists of a sensitivity method that measures linear and nonlinear losses that may occur due to unfavorable fluctuations in market risk factors, bankruptcy risks that may occur due to sudden bankruptcy, and residual risk-bearing equity capital for other losses.

Woori Bank, a major subsidiary subject to Basel III standard approach of market risk management, has the following equity capital required for market risk. (Unit : Korean Won in millions)


	Risk Group	December 31, 2024		December 31, 2025
Sensitivity-based risk	General interest rate risk		29,029		34,292
	Equity risk		3,006		3,152
	Commodity risk		51		3
	Foreign exchange risk		114,174		110,144
	Non-securitization credit spread risk		18,258		23,797
	Securitization (excluding CTP (Correlation Trading Portfolio)) credit spread risk		—		—
	CTP credit spread risk		—		—
Default risk	Non-Securitization bankruptcy risk		8,604		9,207
	Securitization (excluding CTP) default risk		—		—
	CTP default risk		—		—
Residual risk	Residual risk		1,182		1,106

Total			174,304		181,701

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 ΔNII(Change in Net Interest Income) and ΔEVE(Change in Economic Value of Equity) in accordance with IRRBB(Interest Rate Risk in the Banking Book).

ΔNII represents a change in net interest income that may occur over a certain period (e.g. one year) due to changes in interest rates, and ΔEVE 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 off-balance accounts.

ΔEVE and ΔNII calculated on interest risk in banking book(IRRBB) basis for assets and liabilities by subsidiary as of December 31, 2025 and 2024 are as follows(Unit: Korean Won in millions):


	December 31, 2024				December 31, 2025
	Δ EVE (*1)		Δ NII (*2)		Δ EVE (*1)		Δ NII (*2)
Woori Bank		952,830		668,290		488,658		685,472
Woori Card Co., Ltd.		120,153		79,515		106,003		53,435
Woori Financial Capital Co., Ltd.		67,877		16,151		65,780		9,773
Woori Investment Securities Co., Ltd.		29,325		24,911		93,763		90,407
Woori Asset Trust Co., Ltd.		1,817		12,802		716		4,982
Woori Asset Management Corp.		504		1,682		1,134		1,653
Woori Savings Bank		15,117		4,537		29,858		340
Woori Private Equity Asset Management Co., Ltd.		17		338		6		354
Woori Financial F&I Co., Ltd.		97,936		6,858		86,260		8,891
Woori Venture Partners Co., Ltd.		705		3,231		668		2,897

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

(*2)	ΔNII: change in Net Interest Income

At the interest rate re-pricing date, cash flows (both principal and interest) of interest-bearing assets and liabilities, which is the basis of non-trading position interest rate risk management are as follows: (Unit: Korean Won in millions):


	December 31, 2024
	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		241,742,497		53,994,860		25,504,549		17,099,875		78,442,115		5,000,982		421,784,878
Financial assets at FVTPL		297,653		38,474		9,993		5,420		42,433		51		394,024
Financial assets at FVTOCI		7,276,254		4,996,536		2,350,787		2,570,750		26,459,375		1,421,185		45,074,887
Securities at amortized cost		1,318,853		1,651,266		1,856,726		629,079		12,972,012		1,862,090		20,290,026

Total		250,635,257		60,681,136		29,722,055		20,305,124		117,915,935		8,284,308		487,543,815

Liability:
Deposits due to customers		166,841,875		55,267,332		44,234,044		42,203,933		62,625,304		34,751		371,207,239
Borrowings		19,153,362		4,676,893		1,587,119		1,542,868		3,131,674		513,870		30,605,786
Debentures		5,189,563		5,370,343		4,438,800		3,168,918		30,963,968		2,673,453		51,805,045

Total		191,184,800		65,314,568		50,259,963		46,915,719		96,720,946		3,222,074		453,618,070


	December 31, 2025
	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		255,374,516		52,912,872		22,204,663		14,715,553		80,604,982		4,483,870		430,296,456
Financial assets at FVTPL		723,058		23,986		107,748		87,500		68,617		—		1,010,909
Financial assets at FVTOCI		16,102,668		4,109,860		3,296,553		2,170,275		23,894,889		1,298,513		50,872,758
Securities at amortized cost		1,068,946		1,058,142		2,206,199		2,130,814		11,965,315		1,192,507		19,621,923

Total		273,269,188		58,104,860		27,815,163		19,104,142		116,533,803		6,974,890		501,802,046

Liability:
Deposits due to customers		170,106,506		58,129,264		42,994,149		44,283,193		64,141,014		29,351		379,683,477
Borrowings		24,211,741		3,820,560		1,293,285		1,424,149		3,404,397		518,214		34,672,346
Debentures		7,327,498		3,554,590		4,716,362		4,321,910		34,546,993		2,615,848		57,083,201

Total		201,645,745		65,504,414		49,003,796		50,029,252		102,092,404		3,163,413		471,439,024

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.

Financial instruments in foreign currencies exposed to currency risk as of December 31, 2024 and 2025 are as follows (Unit: USD in millions, JPY in millions, CNY in millions, EUR in millions, and Korean Won in millions):


	December 31, 2024
	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		8,258		12,139,283		80,851		757,154		1,331		267,802		223		341,326		1,123,728		14,629,293
Loans and other financial assets at amortized cost		21,637		31,775,374		104,585		979,422		26,856		5,405,371		2,211		3,380,628		7,584,236		49,125,031
Financial assets at FVTPL		887		1,304,438		1,836		17,190		16		3,318		149		227,858		20,087		1,572,891
Financial assets at FVTOCI		3,588		5,274,144		—		—		2,910		585,622		37		55,853		847,518		6,763,137
Securities at amortized cost		767		1,127,313		—		—		980		197,188		36		55,074		175,895		1,555,470

Total		35,137		51,620,552		187,272		1,753,766		32,093		6,459,301		2,656		4,060,739		9,751,464		73,645,822

Liability
Financial liabilities at FVTPL		112		164,400		36		334		—		—		1		1,766		751		167,251
Deposits due to customers		23,607		34,702,743		250,528		2,346,146		27,301		5,494,893		2,024		3,094,378		5,348,009		50,986,169
Borrowings		8,302		12,203,906		56,465		528,785		110		22,235		545		832,661		3,334,191		16,921,778
Debentures		4,549		6,687,333		—		—		—		—		195		297,766		446,349		7,431,448
Other financial liabilities		2,123		3,120,355		20,684		193,701		4,120		829,197		244		373,203		493,198		5,009,654

Total		38,693		56,878,737		327,713		3,068,966		31,531		6,346,325		3,009		4,599,774		9,622,498		80,516,300

Off-balance accounts		9,109		13,390,339		23,905		223,864		1,702		342,576		841		1,286,110		1,506,643		16,749,532


	December 31, 2025
	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		10,382		14,897,814		163,681		1,501,990		1,440		294,862		396		667,551		1,504,069		18,866,286
Loans and other financial assets at amortized cost		22,828		32,755,775		99,204		915,492		18,707		3,830,414		2,122		3,577,181		7,721,655		48,800,517
Financial assets at FVTPL		1,713		2,458,578		1,587		14,562		11		2,350		279		470,231		298,686		3,244,407
Financial assets at FVTOCI		5,189		7,445,013		596		547,281		8,043		696,669		1,765		2,975,486		1,422,141		13,086,590
Securities at amortized cost		610		875,923		—		—		271		55,390		7		12,610		135,379		1,079,302

Total		40,722		58,433,103		265,068		2,979,325		28,472		4,879,685		4,569		7,703,059		11,081,930		85,077,102

Liability
Financial liabilities at FVTPL		62		88,508		—		1		—		—		—		774		138		89,421
Deposits due to customers		22,954		32,937,144		215,351		1,976,126		21,625		4,428,000		5,781		9,744,458		6,344,318		55,430,046
Borrowings		7,846		11,258,513		41,724		382,874		957		195,936		359		605,116		2,055,224		14,497,663
Debentures		4,406		6,322,500		—		—		600		122,856		195		328,345		—		6,773,701
Other financial liabilities		3,148		4,516,991		12,179		111,756		1,423		291,386		62		104,876		352,234		5,377,243

Total		38,416		55,123,656		269,254		2,470,757		24,605		5,038,178		6,397		10,783,569		8,751,914		82,168,074

Off-balance accounts		10,487		15,046,017		19,765		181,369		1,163		238,158		953		1,605,830		561,333		17,632,707

(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 maturity of assets and liabilities or unexpected cash outflows. The consolidated financial liabilities that are relevant to liquidity risk are incorporated within the scope of risk management. Derivative 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.

The information on early repayment related to asset securitization is described in Note 44. Contingent Liabilities and Commitments (4) 3).

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 December 31, 2024 and 2025 are as follows (Unit: Korean Won in millions):


	December 31, 2024
	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		74,205		—		69,534		112,944		—		—		256,683
Deposits due to customers		237,078,927		41,568,072		33,229,547		43,680,907		16,991,574		1,441,654		373,990,681
Borrowings		11,589,854		6,676,926		4,781,377		3,676,310		3,561,696		563,870		30,850,033
Debentures		4,635,557		5,525,191		4,442,376		3,572,533		30,967,974		2,673,592		51,817,223
Lease liabilities		60,099		49,069		45,534		40,375		317,971		50,341		563,389
Other financial liabilities(*)		19,417,326		108,361		30,995		27,093		1,118,751		4,287,489		24,990,015

Total		272,855,968		53,927,619		42,599,363		51,110,162		52,957,966		9,016,946		482,468,024


	December 31, 2025
	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		456,606		103,174		131,181		310,111		324,118		17,501		1,342,691
Deposits due to customers		239,003,957		43,936,717		31,733,945		47,843,702		18,670,748		1,212,186		382,401,255
Borrowings		18,209,601		4,676,557		3,879,109		3,202,042		3,881,934		518,214		34,367,457
Debentures		7,015,353		3,594,266		4,732,824		4,586,030		35,650,614		4,127,981		59,707,068
Lease liabilities		66,838		55,213		50,236		43,549		357,379		44,575		617,790
Other financial liabilities(*)		24,614,468		194,968		35,049		47,917		1,103,857		3,849,974		29,846,233
Investment contract liabilities		3,702,780		—		—		—		—		—		3,702,780

Total		293,069,603		52,560,895		40,562,344		56,033,351		59,988,650		9,770,431		511,985,274

(*)	Lease liabilities are not included.

b)	Cash flows of principals and interests by expected maturities of non-derivative financial liabilities as of December 31, 2024 and 2025 are as follows (Unit: Korean Won in millions):


	December 31, 2024
	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		74,205		—		69,534		112,944		—		—		256,683
Deposits due to customers		242,795,510		43,419,738		32,989,627		38,822,980		14,857,886		491,918		373,377,659
Borrowings		11,592,268		6,678,053		4,782,453		3,678,378		3,555,011		563,870		30,850,033
Debentures		4,635,557		5,525,191		4,442,376		3,572,533		30,967,974		2,673,592		51,817,223
Lease liabilities		60,092		50,205		46,727		41,569		322,272		50,341		571,206
Other financial liabilities (*)		19,418,010		108,690		31,315		27,708		1,116,803		4,287,489		24,990,015

Total		278,575,642		55,781,877		42,362,032		46,256,112		50,819,946		8,067,210		481,862,819


	December 31, 2025
	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		465,982		110,167		135,894		314,271		296,086		17,501		1,339,901
Deposits due to customers		245,944,516		46,024,410		31,302,585		42,075,527		16,164,093		433,017		381,944,148
Borrowings		18,211,997		4,677,678		3,880,180		3,204,104		3,875,284		518,214		34,367,457
Debentures		7,015,353		3,594,266		4,732,824		4,586,030		36,831,544		2,615,848		59,375,865
Lease liabilities		66,842		56,355		51,392		44,714		357,620		44,575		621,498
Other financial liabilities (*)		24,614,468		194,968		35,049		47,917		1,103,857		3,849,974		29,846,233
Investment contract liabilities		3,702,780		—		—		—		—		—		3,702,780

Total		300,021,938		54,657,844		40,137,924		50,272,563		58,628,484		7,479,129		511,197,882

(*)	Lease liabilities are not included.

3) Maturity analysis of derivative financial liabilities

Derivatives held for trading purposes 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 purposes are estimated by offsetting cash inflows and cash outflows.

The cash flow by the maturity of derivative financial liabilities as of December 31, 2024 and 2025 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
December 31, 2024	Cash flow risk hedge		(219	)		193		31			62		207		—			274
December 31, 2024	Fair value risk hedge		(6,816	)		46,231		(11,740	)		44,950		35,764		(5,834	)		102,555
	Trading purpose		9,092,008			90		—			—		—		—			9,092,098

December 31, 2025	Cash flow risk hedge		245,304			721,902		69,178			691,883		608,819		35,265			2,372,351
December 31, 2025	Fair value risk hedge		8,927			24,385		15,933			20,814		38,364		(10,613	)		97,810
	Trading purpose		5,129,664			—		—			—		—		—			5,129,664

4) Maturity analysis of off-balance accounts (Payment guarantees, commitments, and etc.)

A payment 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 credit to the customer. Loan commitments 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 payment guarantees, such as financial guarantees for debentures issued or loans, unused loan commitments, and other credits. 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 as of December 31, 2024 and 2025 are as follows (Unit: Korean Won in millions):


	December 31, 2024		December 31, 2025
Payment guarantees		16,611,262		16,070,098
Loan commitments		133,863,588		134,286,067
Other commitments		4,572,323		5,806,012

(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 problems or external factors.

1) Operational risk management

The Group has established and operated a group operational risk management system to cope with new Basel III global regulations, which is implemented since 2023, and the management of operational risks follows the procedures for risk recognition, evaluation, measurement, monitoring and reporting, risk control and mitigation.

2) Operational risk measurement

The Group measures operational risk capital using the Basel III standardized approach. This approach calculates the required operational risk capital by multiplying the Business Indicator Component (BIC), which represents the scale of operations, with the Internal Loss Multiplier (ILM), which reflects the magnitude of actual historical internal losses relative to the scale of operations.

Operational risk limits are set with the approval of the Board of Risk Management Committee. The Group regularly calculates the operational risk capital and reports any limit breaches to the management and the Board Risk Management Committee.

Since a reduction in the size of internal loss events leads to a decrease in operational risk capital, it is important to prevent loss events in advance. Accordingly, the Group conducts operational risk management activities using tools such as Risk Control Self-Assessment (RCSA), Key Risk Indicators (KRI), and loss data. Additionally, to ensure continuity of operations in emergency situations such as disasters, the key subsidiary has established a Business Continuity Plan (BCP) and conducts annual simulation drills.

(5) Capital management

The Group complies with the standard of capital adequacy provided by financial regulatory authorities. The capital adequacy standard is based on Basel III published by Basel Committee on Banking Supervision in Bank for International Settlement and was implemented in Korea in December 2013. The capital adequacy ratio is calculated by dividing own capital by asset (weighted with a risk premium – risk weighted assets) based on the consolidated financial statements of the Group.

As of the current and prior year-end, the Group has maintained a Common Equity Tier 1 (CET1) ratio of 9.0%, a Tier 1 capital ratio of 10.5%, and a total capital ratio of at least 12.5% in accordance with the relevant standards.

Details of the Group’s capital adequacy ratio as of December 31, 2024 and 2025 are as follows (Unit: Korean Won in millions):


Details	December 31, 2024			December 31, 2025 (*)
Tier 1 capital		28,522,910			30,222,734
Other Tier 1 capital		4,869,567			4,556,265
Tier 2 capital		3,535,362			3,020,751

Total risk-adjusted capital		36,927,839			37,799,750

Risk-weighted assets for credit risk		210,365,462			209,094,901
Risk-weighted assets for market risk		3,125,478			3,101,409
Risk-weighted assets for operational risk		21,609,530			22,345,759

Total risk-weighted assets		235,100,470			234,542,069

Common Equity Tier 1 ratio		12.13	%		12.89	%

Tier 1 capital ratio		14.20	%		14.83	%

Total capital ratio		15.71	%		16.12	%

(*)	The capital ratio at the end of the current period is provisional