Chairman Sohn Tae-seung of Woori Financial Group. (Photo: WFG)

Chairman Sohn Tae-seung of Woori Financial Group and CEO of Woori Bank said he will go after M&As like never before to expand the group’s business scale in key financial areas such as insurance and securities. “Our M&As just begin from right now,” said the chairman in a recent media session with a local newspaper, commenting on the recent takeover of Lotte Card by the financial group.

The chairman said it still has a long way to go to complete its project to expand as well as further diversify the group’s portfolio, which includes a strategy to pick up an insurance and a securities firm, in addition to a number of financial firms, including asset management, trust, savings bank, and capital company.

The chairman said the banking group plans to pursue larger M&A opportunities - of securities and life insurance companies - in the future, as it is obliged to maintain a set capital adequacy ratio and therefore has limits on capital usage for now.

With well-chosen acquisitions, Woori Financial Group’s goal is to bring its banking-to-nonbanking business ratio to 7:3 and eventually to 6:4, enabling Woori to diversify its profits beyond traditional banking services, according to the chairman.

He returned from a four-day investment relations trip abroad in Hong Kong and Japan. He said the next M&A target is a securities firm, making it the last piece in the puzzle to strengthen the non-banking sector of the group, in the hope that it will create synergy with Woori Integrated Finance to strengthen the securities sector.

The chairman is ready to take over an insurance firm, as a number of insurance firms will be coming to the M&A market this year and Woori Financial Group must have an insurance affiliate if it wants to become the top financial group in the country. In January, the chairman pledged to take over an asset management firm, a real estate trust company and a savings bank which he completed as promised.

From next year, the financial group will have its capacity for M&As strengthened as its capital may be boosted up to 130 percent as a financial group, compared to the 20 percent limit placed on the banks.
At the same time, the financial group will be able to mobilize 7 trillion won more in investment funds now that it’s been turned into a financial holdings company early this year and subject to the internal ratings laws application to the asset risk evaluation laws.

Woori Financial Group said recently it has closed a deal to acquire Tongyang Asset Management and ABL Global Asset Management, marking its first acquisition deal since the group’s adoption of a holding company structure earlier this year.

The deal comes around three months after the launch of Woori Financial Holdings on Jan. 11. It marks the start of the group’s pledge to expand its nonbanking business segment through strategic M&As and to expand its scope beyond its main banking business led by Woori Bank.

Woori disclosed that it had purchased Tongyang Asset Management for 123 billion won ($176 million). The purchase price of ABL Global Asset Management was not subject to public disclosure.Woori took off under a holding company structure earlier this year, with Chairman Sohn Tae-seung pledging initial focus on acquiring small asset management firms, real estate investment trusts and savings banks.