[비즈한국] Woori Financial Group316140 is accelerating the strengthening of its non-banking business by incorporating Tongyang Life Insurance082640 as a wholly-owned subsidiary. It has secured 100% of Tongyang Life's shares through a comprehensive stock swap, initiating a restructuring plan that considers future integration with ABL Life Insurance. However, with growing backlash from minority shareholders over exchange ratios and valuation, attention is focused on whether the group can persuade shareholders and successfully complete the integration.
On April 24, the Woori Financial board of directors resolved to incorporate its subsidiary, Tongyang Life Insurance, as a wholly-owned subsidiary. Woori Financial currently holds a 75.34% stake in Tongyang Life and will acquire 100% following the incorporation. The process will be conducted through a comprehensive stock swap, where Tongyang Life shareholders, who hold the remaining approximately 25% stake, transfer their shares to Woori Financial in exchange for Woori Financial's registered common shares. The stock swap agreement is scheduled for April 29, with an exchange date set for August 11.
Regarding the reason for making Tongyang Life a wholly-owned subsidiary, Woori Financial stated, "It is part of efforts to enhance management efficiency and strengthen the non-banking sector," adding, "We will increase business synergy by establishing an efficient management system and strengthening the group's unity." Furthermore, the company stated, "We will continue to pursue effective management, strategies to enhance group value, and plans to expand our non-banking business portfolio to strengthen the competitiveness of our subsidiaries."
Starting with this incorporation of Tongyang Life, the integration of Woori Financial's life insurance subsidiaries is also expected to follow. After media reports suggested that Woori Financial would merge Tongyang Life with ABL Life following its incorporation as a wholly-owned subsidiary, Woori Financial disclosed on the 16th that "it is under review, but nothing has been decided," though the current move effectively confirms the push for integration.
In its disclosure of the stock swap decision on the 24th, Woori Financial stated, "We are reviewing the merger of Tongyang and ABL Life Insurance after Tongyang Life becomes a wholly-owned subsidiary. The merger is expected to eliminate inefficiencies caused by operating the same business through two companies within the group, as well as enhance the management efficiency of insurance subsidiaries, realize economies of scale, and reduce operating costs," adding, "However, the merger requires the approval of both companies' boards, and the implementation, method, and timing have not been finalized."
The integration of Tongyang Life and ABL Life is a predicted step considering their competitiveness in the insurance market. After receiving conditional approval for the acquisition of Tongyang Life and ABL Life in May 2025, Woori Financial officially incorporated them as subsidiaries in July of that year, completing its comprehensive financial group structure. As of the end of 2024, Tongyang Life's assets stood at approximately 34 trillion won, and ABL's at 18 trillion won; a merger would elevate the group to the top five in the life insurance market. Because of this, critics have repeatedly noted that keeping separate companies for the same business is inefficient.
Strengthening the non-banking sector is also essential for Woori Financial's performance. In the first quarter of 2026, Woori Financial was the only one among the four major financial holding companies (KB, Shinhan, Hana, and Woori) to record negative growth in net profit. It reached 639 billion won, a 2.4% decrease from the same period last year. This figure fell below market expectations and is considered sluggish compared to other holdings. In the first quarter, KB Financial105560 posted a net profit of 1.9165 trillion won, Shinhan Financial 1.6491 trillion won, and Hana Financial 1.2131 trillion won, all exceeding the 1 trillion won mark.
Woori Financial explained the earnings decline, stating, "Increased market volatility due to the Middle East war led to a decrease in gains from securities and exchange rates, and we reflected one-time provisions related to overseas subsidiaries." To strengthen the non-banking sector, in addition to integrating life insurance companies, Woori Financial is also embarking on capital expansion for its securities subsidiary by executing a capital increase of approximately 1 trillion won for Woori Investment & Securities.
Woori Financial maintains that the Tongyang-ABL Life merger is also beneficial for shareholder interests. During the first-quarter earnings call held on the 24th, the company emphasized, "In the mid-to-long term, this is to enhance shareholder value by retaining 100% of Tongyang Life's profit-generating capability within the group."
Meanwhile, there are signs of backlash among minority shareholders of Tongyang Life regarding the stock swap. Tongyang Life, which is listed on the KOSPI, will be delisted once the stock swap with Woori Financial is completed. Shareholders opposing the stock swap must notify the company in writing by the day before the extraordinary general meeting of shareholders (July 24). Tongyang Life and Woori Financial stated, "This has the effect of reducing management costs through the resolution of duplicate listings and allowing for a reasonable assessment of corporate value."
The exchange value for Tongyang Life shares was calculated at 8,720 won per Woori Financial share, with an exchange ratio of approximately 0.25 shares of Woori Financial for 1 share of Tongyang Life. If dissenting shareholders exercise their appraisal rights, the proposed purchase price is set at 8,505 won (as of April 23). The exercise period for appraisal rights is from July 24 to August 3.
Following the disclosure of the swap terms, Tongyang Life minority shareholders are raising their voices in concern, pointing to issues such as an excessively low exchange ratio, a valuation lower than the stock price at the time of Woori Financial's acquisition (10,520 won), and the possibility of share price decline. Along with this, they have set out to secure a 3% stake via the shareholder rights platform 'ACT.' As of 4:00 PM on April 27, the concentration rate of minority shareholders stood at 2.62%. Under the Commercial Act, securing a 3% stake or more allows shareholders to exercise rights such as requesting the convocation of an extraordinary general meeting, making shareholder proposals, and dismissing directors or auditors.