Of this amount KRW1,009 billion was of ordinary accruals and KRW872 billion was for preemptive provisioning. And this preemptive credit cost amounts to KRW525 billion in the fourth quarter. In the case of the KRW525 billion it is in response to regular estimates reflecting future economic outlook and adjustments to the loan loss factors including risk management components of LGD. And therefore this is KRW229 billion that was set aside for reserves, and in addition to that KRW96 billion related to the debt workout company and KRW200 billion to strengthen loss absorption capacity in vulnerable sectors such as real estate PF. Next is on NPL coverage ratio and the loan loss provision ratio to total loans. Now, Woori Financial Group as was mentioned has been very much focused on preemptive provisioning and we have been strengthening our loss absorption capacity and the NPL coverage ratio as of the end of fourth quarter 2023 is 229.2%.
And not only in terms of the provisioning but if you refer to the provisioning ratio to total loans, it has been continuously increasing indicating that the other group has been very much proactive in preparing for any insolvency across all loans. On the right, you can refer to the status of the real estate PF loans. The total amount of the group’s real estate PF loans and the PF bridge loans a total of KRW3.4 trillion. Of this we have agency guaranteed loans which is KRW1.3 trillion including the HUG or HUG guarantee. And you can see that it’s – excluding that it’s KRW2 trillion in terms of the outstanding balance. Including the bridge loans and the overall real estate PF we have a total of 200 sites and what we have been doing was in a comprehensive site evaluation to understand the risk as well as any cases of insolvency and we’ve been reviewing the vitality of the sites.
And we have developed and managed the response plans such as adding additional reserves in case of losses. Next, moving on to the CRE in the U.S. With regard to CRE in the U.S., it’s KRW2.9 trillion and syndicate is KRW1.1 trillion loan and the general loans is KRW1.8 trillion. In the case of the general loans, unlike the syndicated loans, it’s true that it consists of small amount loans and the risk is of course diverse. And in the case of the CRE loans, you can see that mostly are senior loans. So the LTV ratio is average 40% and in terms of loan preservation or recovering credit, it’s quite satisfactory. And last but not least, in 2024, I would like to mention our direction in 2024, the unstable financial market and the high risk interest rate situation is to persist.
And in response, we’ve been very much focused on asset soundness as well as capital adequacy when it comes to our risk management. Through growth center on new quality growth companies and prime companies, we will improve our quality of the portfolio and also with regard to high risk assets, including CRE assets. And also in terms of vulnerabilities and some of these subsidiaries portfolio, we will be focusing on inducing a soft landing and by establishing a regular response system for each risk factor such as interest rates and exchange rates; we’ll strengthen the group’s crisis response capabilities and also including ICT risk and digital risk and other operational risk. And also understanding the country specific risks. We want to put in place a differentiated global risk management system.
Thank you very much.
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