Woori's Provisions Jump 42% as Profit Falls 15%
Woori Financial Group (WF) booked KRW 1,162,903 million in credit-loss provisions for 2025, up 41.6% from a year earlier, dragging net income attributable to owners down 14.8% to KRW 2,589,646 million even as net interest income and deposits both grew.
Woori Financial Group (WF), the Seoul-based banking group whose core lending unit is Woori Bank, closed 2025 with a credit-cost problem overshadowing an otherwise steady net interest story. Provision for expected credit loss allowance rose 41.6% year over year to KRW 1,162,903 million, from KRW 821,250 million in 2024, extending a climb that began at KRW 993,519 million in 2023 before dipping and now resuming its ascent. That single line did the most damage to the bottom line, helping push operating income down 13.5% to KRW 3,520,742 million from KRW 4,069,308 million.
The underlying lending business held up. Net interest income increased 3.3% to KRW 7,816,505 million from KRW 7,566,241 million, a gain built less on loan growth than on funding costs: interest expense fell 15.3% to KRW 10,145,097 million, outpacing an 8.1% drop in interest income to KRW 17,961,602 million. Loans and other financial assets at amortized cost grew just 1.3% year over year to KRW 371,209,305 million, a marked deceleration from the 5.7% pace Woori posted between December 2023 and December 2024, while deposits due to customers grew 2.3% to KRW 372,337,805 million. The bank is gathering deposits faster than it is extending credit, a mix that helped compress funding costs but also signals a more cautious lending posture heading into 2026.
Fee income offered no offset. Net fees and commissions income slipped 1.3% to KRW 993,219 million as fee expense climbed to KRW 230,348 million from KRW 209,103 million, swamping a modest 0.7% rise in gross fee income. The sharper hit came from markets: net gain on financial instruments at fair value through profit or loss collapsed roughly 77% to KRW 336,949 million from KRW 1,453,921 million, a swing large enough on its own to explain much of the non-interest income shortfall. General and administrative expenses added further pressure, rising 14.6% to KRW 4,293,462 million from KRW 3,746,916 million.
The combined effect of heavier provisioning, a weaker trading line and rising costs pulled net income attributable to owners down 14.8% to KRW 2,589,646 million from KRW 3,039,372 million, with earnings per share falling to KRW 3,492 from KRW 4,138.
Capital metrics moved in the opposite direction. Total equity rose 2.6% to KRW 29,687,452 million from KRW 28,944,888 million, and Woori lifted common-stock dividends 20.2% to KRW 1,352,524 million from KRW 1,131,996 million. Paying out more even as profit fell signals management's confidence in the balance sheet's capacity to absorb the credit-cost increase without curbing shareholder returns.
The result frames 2026 around a single question: whether the provisioning trend that has now risen for two straight years stabilizes as asset quality normalizes, or whether slower loan growth was itself a defensive response to the deteriorating credit backdrop. Either way, funding-cost relief has done its job on the net interest line; the next test for Woori is whether credit costs stop climbing before they erode the capital gains dividends currently depend on.