Woori Bank is increasing the weight of profitability in its key performance indicators (KPIs). With first-half results falling short of expectations, the bank aims to improve performance in the second half through non-interest income and pensions.
According to the financial sector on July 8, Woori Bank has raised the risk-adjusted return (RAR) assessment score from 200 to 240 points for the second half of the year. RAR measures profit after excluding direct and indirect costs (such as rent and salaries) from the bank's operating income. To increase the RAR score, the bank must enhance its interest income, fee income, and non-interest income.
The bank has also expanded the scoring for key customer indicators, evaluating how well it encourages metrics related to the four major pensions, salary transfers, and card payments. The assessment score for corporate loans has increased by 10 points compared to the first half.
This shift towards a profitability-focused KPI is seen as linked to the reappointment of Woori Bank President Jeong Jin-wan, whose term ends in December.
In the first quarter of this year, Woori Bank's non-interest income fell by 36.6% compared to the same period last year, while small business loans decreased by 3.9%. Although the second-quarter results are expected to improve compared to the first quarter, industry consensus suggests that significantly increasing assets at once will be challenging. Reports indicate that the bank achieved only about 50% of its targets in the first half.
The third-quarter results will be crucial in determining the bank president's reappointment. This has led to a management strategy emphasizing steady fee income from pensions and non-interest income.
Employees are expected to face increased pressure as competition among banks for the pension and salary transfer markets intensifies. Once customers are acquired, they often expand their transactions to include cards, savings, and loans.
Additionally, as banks compete to expand productive finance, there are concerns that the burden to meet related evaluation metrics will also grow.
Woori Bank is also restructuring to expand its customer base alongside the KPI changes. It has merged its existing departments—Personal Sales Strategy, Real Estate Finance, Channel Strategy, and MyData Platform—into a new Retail Sales Division. This aims to unify sales operations and strengthen both retail and corporate sales. Furthermore, President Jeong has called for a reduction in sales management expenses to cut costs.
A financial sector official stated, "It will take considerable time for the insurance company acquired by Woori Bank to generate results. While solidifying its foundation, the bank will focus on increasing immediate revenue through fees and other means."
According to the financial sector on July 8, Woori Bank has raised the risk-adjusted return (RAR) assessment score from 200 to 240 points for the second half of the year. RAR measures profit after excluding direct and indirect costs (such as rent and salaries) from the bank's operating income. To increase the RAR score, the bank must enhance its interest income, fee income, and non-interest income.
The bank has also expanded the scoring for key customer indicators, evaluating how well it encourages metrics related to the four major pensions, salary transfers, and card payments. The assessment score for corporate loans has increased by 10 points compared to the first half.
This shift towards a profitability-focused KPI is seen as linked to the reappointment of Woori Bank President Jeong Jin-wan, whose term ends in December.
In the first quarter of this year, Woori Bank's non-interest income fell by 36.6% compared to the same period last year, while small business loans decreased by 3.9%. Although the second-quarter results are expected to improve compared to the first quarter, industry consensus suggests that significantly increasing assets at once will be challenging. Reports indicate that the bank achieved only about 50% of its targets in the first half.
The third-quarter results will be crucial in determining the bank president's reappointment. This has led to a management strategy emphasizing steady fee income from pensions and non-interest income.
Employees are expected to face increased pressure as competition among banks for the pension and salary transfer markets intensifies. Once customers are acquired, they often expand their transactions to include cards, savings, and loans.
Additionally, as banks compete to expand productive finance, there are concerns that the burden to meet related evaluation metrics will also grow.
Woori Bank is also restructuring to expand its customer base alongside the KPI changes. It has merged its existing departments—Personal Sales Strategy, Real Estate Finance, Channel Strategy, and MyData Platform—into a new Retail Sales Division. This aims to unify sales operations and strengthen both retail and corporate sales. Furthermore, President Jeong has called for a reduction in sales management expenses to cut costs.
A financial sector official stated, "It will take considerable time for the insurance company acquired by Woori Bank to generate results. While solidifying its foundation, the bank will focus on increasing immediate revenue through fees and other means."
* This article has been translated by AI.
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