Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 9

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 9
---
 our business, financial condition and results of operations.

In particular, difficulties in financial and economic conditions could result in significant deterioration in the quality of our assets and accumulation of higher provisioning, allowance for credit losses on loans and charge-offs as an increasing number of our corporate and retail customers declare bankruptcy or insolvency or otherwise face increasing difficulties in meeting their debt obligations. For example, from time to time, difficulties in certain industries such as real estate and shipbuilding have led to increased delinquency among our corporate borrowers, including some Korean commercial conglomerates known as “chaebols,” and in certain cases, even insolvency, workouts, recovery proceedings and/or voluntary arrangements with creditors. Sustained slumps in the real estate market have also led to increased delinquency among our retail borrowers, and in particular, borrowers with collective loans for pre-sale of newly constructed apartment units. Various Government-led financial support programs for small- and medium-sized enterprises and small business owners introduced since April 1, 2020 in response to the COVID-19 pandemic, such as loan rescheduling and principal and interest payment deferral programs, which have helped financial institutions, including Shinhan Bank, manage their asset quality at a stable level, generally expired in September 2022. However, the Government decided, based on discussions with financial institutions, to provide further financial support to debtors using financial support programs such as (i) the extension of loan maturity dates up to three years, (ii) the postponement of repaying loans up to one year until September 2023, or (iii) the rescheduling of loans under the New Start Fund set up by the Government on October 4, 2022 or loan rescheduling programs led by the financial institutions. In addition, additional policies for small business owners were announced in December 2024, including the introduction of customized debt restructuring, mutual prosperity guarantee and loan programs, consulting programs, and low-interest and long-term installment repayment programs for small business owners who have recently closed their businesses. Shinhan Bank’s delinquency ratio was 0.21% as of December 31, 2022, 0.26% as of December 31, 2023 and 0.27% as of December 31, 2024. Despite such financial support programs, there is no assurance that Shinhan Bank will not experience increased level of credit losses on loans from borrowers, particularly those in troubled industries, since the quality of loans to such borrowers may further deteriorate due to a continued slump in volatile