Good afternoon. I am Hong Sung Han, Head of IR at Woori Financial Group. Let me first begin by thanking everyone for taking time to participate in this earnings conference call for Woori Financial Group. On today's call, we have the group CFO, Sung-Wook Lee; Group CDO, Il-Jin Oak and Group CRO, Jang-Geun Park as participants. On today's call, the group CFO, Sung-Wook Lee Wu, will give a presentation on the earnings performance, after which we will have a Q&A session. Please note that the earnings call is being conducted with simultaneous interpretation for our overseas investors. Now let us start our presentation on Woori Financial Group's earnings for the first half of 2025.

Good afternoon. This is Sung-Wook Lee, the CFO of Woori Financial Group. Let me go over the first half performance for 2025. Please turn to Page 3 of the presentation material that has been disclosed on our website. First, let me discuss net income. For the first half of 2025, Woori Financial Group's net income was KRW 1,551.3 billion, representing a Y-o-Y decrease of 11.6%. When excluding the one-off expenses related to the early retirement program conducted at the beginning of the year and preemptive provisions for a completion guarantee of Trust company, net income is similar to last year. In the first half, conservative loan loss management to address the slowdown in the economy and SG&A to expand the nonbank portfolio of the group did increase costs, but the net operating revenue, which shows the profit generation capability of the group, still maintain steady growth amid a challenging business environment. Bottom line growth based on asset rebalancing and better margins driven by funding optimization amid a falling market rate resulted in stable interest income while core fee income from the Wealth Management business and an increase in noninterest income, derived on capital market activities generated the top line performance. Second quarter net income was KRW 934.6 billion, which is KRW 300 billion higher than the first quarter. That did not beat market expectations. Next, let me discuss how we achieve the group's capital target -- capital ratio target. As of June 2025, the group's preliminary CET1 ratio is 12.76%, showing around 60 basis points increased from the end of last year and exceeding 12.5% for the first time in the history of the group. Amid a uncertain financial backdrop, the group was able to generate total profits, build an optimal portfolio based on RWA prudently managed asset sensitive to…

[Operator Instructions] The first question today will be from NH Securities, Jun-Sup Jung.

I am Jun-Sup Jung from NH Securities. So there are 2 questions that I would like to ask you. The first question is related to what you have talked about before, which would be the acquisition of the insurance arm. So in terms of your direction going forward and strategy, this is something that I am very curious about. So it might not be an urgent issue, but you have acquired 2 companies. And there are some interest about whether you will merge the 2 entities or maybe delist the listed entity. So with regards to these issues, have you made any decisions? Or are there any consideration or options that you are reviewing? In addition to that, if there are any capital gains from the acquisition, how much do you believe that, that would represent in terms of value? The second question that I would like to ask you is in terms of your capital ratio and also TSR. So your CET1 ratio has improved a lot. And also with regards to what you have said, you all have also said that you were trying to achieve 13% as early as possible. So does this mean that the year-end target would be 13%? Because according to what level of the CET1 ratio sits at, then the TSR could differ. So if you achieved 13% at the end of the year, then is there any possibility that we could look forward to additional TSR measures such as purchasing treasury shares?

So for the 2 questions that you have asked, thank you very much. Maybe we can prepare a second and then address your questions. Yes. Thank you for the question. So I think that with regards to the acquisition of the insurance arm, I do think that it's a very comprehensive question touching upon a lot of different issues. So maybe I can give you a brief question. I do think that this is a topic of interest for many. So maybe we can share what we're thinking about right now and also in terms of the direction going forward. So I do think that it might be a lengthy answer. So that have been said, with regards to the insurance acquisition right now, in August of last year, we did sign the FDA. And then of May this year from the FFC, we did receive the approval to include it as a subsidiary. So as of July 1, we have completed the inclusion. So, with regards to the strategy going forward for the insurance arm, I think that basically, what we can say is that we are going to focus on sound capital management to ensure that we are able to have a stable marketing fundamentals to ensure that we can have sustainable growth. So in the short term, we're currently doing a business assessment. And after this is completed, we will be actually looking at the K- ICS ratio and also the improvements that would be necessary for the capital adequacy and also the key agenda items to strengthen the fundamental competitiveness of the arms. So this is something that we are going to do to fundamentally improve the business. So right now, in terms of the K-ICS ratio and also in terms of securing the capabilities, that…

Next question is Yong Jin Seol of SK Securities.

So, I do want to understand the MTS service, some updates on -- from the -- your brokerage business. I know that we have fierce competition in that domain. So that to understand what were the performance achievements and also what's the future time schedule as to -- are you looking into scaling or making inroads into specific markets?

I'm Il-Jin Oak the CTO. With regard to the MTS, it was launched at the end of June or rather it was the end of March. And for 3 months, we've opened 20 new accounts. And we are opening the services one by one. And in April, we had OTC funds and 1 RP and Universal Banking in June. Within one banking, we do have one bank -- we do have the MTS [indiscernible] banking, so for Wealth Management or AI-based investment insights, or user-based interfaces are some of the differentiators that we do offer. And in September, we do have a new integrated MTS and an ATS market to open. And in December, within Universal Banking, so for overseas stocks trading service that will also be embedded into the system. And within Universal Banking, MTS has been seeing some new climate clients coming in, so I can say that it is effective in terms of attracting clients. And also with regard to Woody Investment Securities, if I may share with you the strategy that we have for our brokerage arm. So, we have IB and digital capabilities, and we're actually focusing on enhancing our competitiveness. So we're putting together the system and we do have the human resources right now, and we're continuing to complement the systems and the facilities and we are continuing to expand on our sales organization. And we are, of course, actively managing risk assets. But with regard to securities and especially when it comes to risk assets, I do want to mention that we are actually engaging in a very aggressive allocation of assets, and we're trying to actively engage in deal structuring and referrals and moving on from corporate finance to asset management, basically providing a one-stop financial service is what we do want to offer. So compared to the first quarter, in the second quarter in terms of operating income, in terms of overall performance, of course, we're seeing SG&A going in. However, we're seeing the ratio improving going forward. So we are scaling and in the future, Woori Investment Securities, especially in the nonbanking business, we think that's going to play a pivotal role. And we consider the IT systems and so forth. Next year is going to be completely different. We do believe that it's going to be a different story going forward with more contributions coming from Woori Investment Securities.

The next question will come from KS, Doosan Baek.

This is Doosan Baek from KIS. So I would like to ask you a question about stable coins. So in July, or June, there was the framework act on digital assets. And I do think that there will be additional proposals that will be submitted next week. So in terms of the legalization, it does seem to be that it is gaining speed. So with regards to stable coins, what is your approach? What would be -- how are you going to address this opportunity?

Thank you very much, and let us address your question. So this is the CTO. So for stable coin, I do think that as of now in terms of the legal framework, it is something that is still in process. So we're looking at what's the overall trends are. So in terms of the qualifications for issuers, it's still a bit uncertain. So we're still something that we're monitoring very closely. And as of now, the bank level, of course, we are looking at the OBDIA. So we are looking at a joint issuance with the OBDIA other members. And related to that, in terms of our business model, infrastructure, establishing and also our business model is something that we are currently looking at. Thank you.

Next question from Do Ha Kim from Hanwa Investment & Securities.

I have a question with regard to Loan portfolio and margins. And could you provide us with the guidance with regard to the targets that you have for the second half? And the next question has to do with Insurance. As was already mentioned, I can see that you're currently reviewing the current status, and I know that it's a bit hasty to provide us with a detailed response. However, if we look at the Insurance, there are, of course, consider with regard to the capital ratio of the company. And so we would like to understand and rest assured that we don't have to go to the point of capital increase. So if you look at the total capital ratio, there is the basic ratio and there are regulations. So with regard to that, and we're seeing some stricter regulations on the basic capital ratio. So we would like to understand if you can maybe lay out some of the measures that you have that you can actually cover for that without a capital increase. So it could be a very rough plan, but if you can share that with us, I think that we would rest assured. So with regard to this, is there anything that you can add, please?

Yes, first on margin. The NIM of the second quarter was 1.4%, and it was increased by 1 bps -- 1 bp. And as mentioned, the market rates did go down the loan interest rates went down. However, with asset rebalancing as well as, increase of core fee income, we were able to see an increase of 1 bp in terms of NIM. But what this really has to do with our asset growth. And I will be giving you some more information on this. But this year, it was on managing risk assets -- risk-weighted assets. And it was about managing this below nominal GDP and we're very much focused on asset quality. So in the second half, it will be similar, more or less the same at 1.4%. Of course, there will be a further reduction in rates, but we don't think that it's going to be higher than the 1.4%. So it would be more or less in the early end of 1.4% in the second half as well, mid- to low level. And then in the case of assets, in terms of RoRWA, we've been actively managing the risk assets and especially in the second half, there are tariffs, there's also FX fluctuations. And at the end of June, it was dipping down and it's been slightly going up. So there are a lot of volatility right now. So with regard to assets because we're going to continue on to manage this. So we will be focusing on asset growth. But once again, we do have nominal growth in the case, some retail loans were household -- it's true that there is active government policy in place, and we're going to take that in mind in terms of our active management. In terms of corporate loans,…

The next question will be from Daishin Securities, Hye-jin Park.

I would like to ask about credit costs. So if we look at the credit cost trend in the first half, it continues to be a wait on the operations. So of course, there were some one-off issues like the completion guarantee trust. But in terms of the normalized level, it does seem to be that there seems to be an increase. So for the full year for the CCR guidance, how -- what would the level be for our expectations? If you could share that number, that would be appreciated.

So this is the CRO, Jang-Geun Park. So if we look at the second quarter, it was 49 basis points. So it was a 3 basis point increase at the group level. And of course, if we -- there was KRW 86 billion in one-off preliminary provisions for the credit guarantee Trust. If we exclude that amount, it's actually at 42 basis points. So it's a very stable level. However, in terms of the normal level of credit cost, it is trending up. And going forward, right now, there are ongoing asset rebalancing. We're focusing on the lower risk prime assets. So right now, the portfolio transitions that we have made will come into effect in the second half. And also from June, we have an asset quality TFT that we are operating at the bank level and if all of those measures are put in place, then from the second half of the year, we do think that there will be improvements that we will be able to see. So as a result for our 2025, if we look at CCR, at the beginning of the year, we said it was around low to mid-40%, and we do think that we will be able to manage it at that level for the full year.

Currently, we do not have a queue right now. So we have received questions in advance via our website. So let us cover these questions. So before the earnings presentation, we have been receiving questions via our website. And with regard to frequently questions during the conference call, we did announce that we will be addressing them if and when possible. With regard to shareholder return and the insurer acquisition and for the first time, there are also questions that came in on the stable coin. And most of the questions have been covered. But one question also had to do with the scheduling of the treasury share cancellation. So we would like to ask the CFO to respond to this question.

Yes, I am Sung-Wook Lee. So with regard to the scheduling of the share cancellation, in 2023, ever since we became a holding company, we've engaged in cancellation of KRW 100 billion and KRW 136.7 billion and KRW 150 billion. So every year, we have been engaged in cancellation for the 3 years. So we have engaged in the share buyback and now in September 11, the trust contract is to be concluded. And then after that, we will be canceling the entire shares. And then with regard to share buyback and calculation, after the KRW 150 billion cancellation, we will take into consideration CET1 ratio as well as the financial environment and conditions and then decide on how we will go ahead with it. Thank you.

Yes. There does not seem to be any more questions. So we would like to wrap up the Q&A here. So if you do have any questions, please do not hesitate to contact the IR team. We will make sure to answer any questions you may have. So with this, we would like to wrap up the Q&A session and also the first half 2025 Earnings Conference Call for Woori Financial Group. Thank you for your attention.