Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 210

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 210
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 must obtain approval from the Financial Services Commission. Approval to merge with any other banking institution, to liquidate, to close a banking business or to transfer all or a part of a business must also be obtained from the Financial Services Commission. If the Financial Services Commission deems a bank’s financial condition to be unsound or if a bank fails to meet the applicable capital adequacy ratio set forth under Korean law, the Financial Services Commission may order, among others:

| • |     | capital increases or reductions; |

| • |     | suspension of officers’ performance of their duties and appointment of custodians; |

| • |     | stock cancellations or consolidations; |

| • |     | transfers of a part or all of business; |

| • |     | sale of assets and bar on acquisition of high-risk assets; |

| • |     | closures or downsizing of branch offices or workforce; |

| • |     | mergers or becoming a subsidiary under the Financial Holding Companies Act of a financial holding company; |

| • |     | acquisition of a bank by a third party; |

| • |     | suspensions of a part or all of business operation (not more than six months in the case of suspension of all business operations); or |

| • |     | assignments of contractual rights and obligations relating to financial transactions. |

149

Capital Adequacy The Banking Act requires nationwide banks to maintain a minimum paid-incapital of W100 billion and regional banks to maintain a minimum paid-incapital of W25 billion. In addition to minimum capital requirements, all banks including foreign bank branches in Korea are required to maintain a prescribed solvency position. A bank must also set aside as its legal reserve an amount equal to at least 10% of its net profits after tax each time it pays dividends on net profits earned until such time when the reserve equals the amount of its total paid-incapital. Under the Banking Act, the capital of a bank is divided into two categories: Tier I and Tier II capital. Tier I capital (typically referred to as “Core Capital”) consists of (i) the capital that can absorb losses incurred by a bank such as capital, capital surplus and earned surplus generated from the issuance of common shares (collectively, “Common Stock Capital”), and (ii) the capital that can absorb the losses of a bank after depletion of the Common Stock Capital such as capital and capital surplus generated from the issuance of Tier I capital instruments satisfying the requirements designated by the Financial Supervisory