Woori Bank Successfully Issues 210 Billion Won in Payment-Guaranteed Covered Bonds

First Issuance Utilizing HF Payment Guarantee
Five-Year Maturity with Fixed Annual Interest Rate of 2.76%

Woori Bank announced on July 30 that it had successfully issued 210 billion won worth of Korean won-denominated covered bonds (dual recourse bonds) utilizing a payment guarantee from the Korea Housing Finance Corporation (HF).

Payment-guaranteed covered bonds are financial instruments that combine the Korea Housing Finance Corporation's payment guarantee with bonds issued by banks using high-quality assets (such as mortgage loan receivables) as collateral. This structure lowers interest rates and enhances stability. This issuance marks Woori Bank's first case of issuing covered bonds.

The bonds were issued with a five-year maturity and a fixed annual interest rate of 2.76%. The issuance rate was calculated by adding a spread of 0.15 percentage points to the five-year government bond yield as of the closing price on July 28. The funds were raised at a rate approximately 10 basis points (bp; 1bp=0.01%) lower than the private sector average rate for bank bonds with the same maturity. Woori Bank explained that, compared to other covered bonds with the same structure, this issuance achieved the lowest-ever spread and interest rate, earning high marks in the market.

A Woori Bank representative stated, "Through the issuance of payment-guaranteed covered bonds, we have been able to reduce funding costs and strengthen our long-term funding base. Going forward, we plan to continue providing stable long-term mortgage loan products that minimize interest rate fluctuation risks."