Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 266

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 266
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 it is expected that interest in retirement pension-linked products will continue to grow, as will online sales. Such growth in alternative investments is expected to offer new opportunities; however, increasing market volatility due to governments’ monetary policies, stricter regulation on private equity activities and increased risk of class action suits from investors may pose additional risks.

The total amount of assets under management by Shinhan Asset Management increased by 11.9% to W121.0 trillion as of December 31, 2024 from W108.1 trillion as of December 31, 2023, due to overall growth in demand for stocks, bonds and alternative investments. The total amount of discretionary investment contracts increased by 1.3% to W60.4 trillion as of December 31, 2024 from W59.6 trillion as of December 31, 2023, primarily due to an increase in the volume of contracts with insurance companies. Operating profit increased by 27.7% to W45.6 billion in 2024 from W35.7 billion in 2023, and net profit increased by 298.9% to

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**W107.8 billion in 2024 from W27.0 billion in 2023, primarily due to an increase in fees and commission income as a result of an increase in assets under management and an increase in valuation gains on Shinhan Asset Management’s investments.

As estimated returns on investments in the Korean market are expected to remain low due to slowing growth of the Korean economy, demand for investments in overseas markets and non-financial assets is expected to increase. Demand for long-term investment products in the public fund market, such as individual annuity funds and retirement pension funds, is expected to continue to rise. Demand from investors looking to invest in ESG products is expected to continue to be strong as new ESG products are introduced into the market and gradually attract interest from retail investors.

Interest Rates

Interest rate movements, in terms of magnitude and timing as well as their relative impact on our assets and liabilities, have a significant impact on our net interest margins and profitability, particularly with respect to its financial products that are sensitive to such movements. For example, if the interest rates applicable to Shinhan Bank’s loans (which are recorded as our assets) decrease at a faster pace or by a wider margin, or increase at a slower pace or by a thinner margin, compared to the interest rates applicable to its deposits (which are recorded as our liabilities), Shinhan