Woori Becomes Largest Financial Group Here
By Kim Jae-won
Staff Reporter
"Flowers cannot keep their beauty for more than 10 days, so political power cannot last more than 10 years" is a popular Chinese idiom.
The domestic financial industry proves to be no exception. Woori Financial Group recently surprised investors by taking the first place in total assets, overtaking its long-time rival KB Financial Group, which has been dominant in the local banking industry.
The group said that its total assets reached 317.9 trillion won in December, down 10.5 percent from the previous quarter. However, it grabbed top place in total assets edging KB by 1.9 trillion won.
The group also showed improvement in profitability. It recorded a net income of 1.03 trillion won in 2009, up 126 percent from a year ago. Net profit stood at 156.8 billion won in the October-December period, a turnaround from a loss of 664.8 billion won a year earlier.
In line with robust business performances, its stock prices also rebounded. They reached 13,700 won on Monday, up 115.7 percent from the end of 2008, when the price was just 6,350 won. This is expected to be a great help for the group to speed up its privatization.
Expanding Overseas Policy
With the global crisis easing, Woori is setting its sights on overseas markets to get the upper hand in emerging markets. Chairman Lee said that the group should step up its efforts to strengthen overseas business.
"Overseas business for Woori provides just six percent of our revenue, while at global financial groups, such as Citigroup and HSBC, the ratio is from 40 to 60 percent," Lee said at his New Year's address on Jan. 4.
"Such numbers show how much effort we should pour into international business."
Woori Bank, the flagship of the group, leads the group's overseas expansion. The lender is pursuing international growth by focusing on improving profitability and the financial soundness of overseas branches.
So far, the lender has a total of 50 overseas offices in 15 countries worldwide. The bank plans to add a new office in Indonesia in the first half of this year and to open two branches in China in the second half of 2010.
In the international arena, Woori Bank will thoroughly review region-specific risk, market conditions and profit potential before making new investments.
All-in-One Service
The financial group provides a one-stop service for customers providing credit cards, securities, asset management and insurance as well as banking.
The credit card sector is gradually gaining in reputation in the industry. Woori Card's market share reached 7.99 percent at the end of 2009, up 2.37 percent from three years ago.
Other subsidiaries also showed handsome performances in 2009. Kyongnam and Kwangju banks, Woori Investment Securities and Woori Financial, registered net profits of 193.6 billion won, 62 billion won, 111.5 billion won and 25.7 billion won, respectively.
Woori Bank, the flagship of the financial group, showed remarkable performance posting a net profit of 953.8 billion won last year, up 307.6 percent from the previous year, with an operating income of 5.2 trillion won.
Analysts said Woori's stock value will rise after privatization.
"Woori has been underestimated. After privatization, its value will be appreciated in the market," an analyst at Prudential Investment & Securities said.
Potential to Grow
"The net interest margin of Woori Bank is recovering more than expected since the second half of 2009. Loan-loss provision will also continue to go down this year."
Woori welcomes global investors saying the group has the potential to grow.
"Experts say that our stock price is still undervalued. Woori will see its value go up through privatization in the foreseeable future," said a report released by the group recently.