Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 502

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 502
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 and 2024

| 5. | Financial risk management (continued) |

| (*4) | It is an account that deals with bonds and liabilities based on the settlement of listed stocks traded in the market. The Group currently has a legally enforceable right to set off the recognized amounts and intends to settle on a net basis. Therefore, the net amount is presented in the consolidated statement of financial position. The offset amount of related bonds and liabilities based on the settlement ofover-the-counterderivativesin-housepayment by Central Clearing System is included. |

| (*5) | As of December 31, 2024, the total amount of financial liabilities includesW7,966,828million of ELS (equity-linked securities) products and of DLS (derivative linked securities) products. In the course of this transaction, the Group has provided collateral for some transactions. The financial instruments provided as collateral ofW586,768million are included in the related instruments not offset in the statement of financial position. |

| (i) | Capital risk management |

The criteria for capital adequacy to be complied with by the Group are 8.0 %. In addition, the minimum regulatory BIS capital ratio, which should be maintained additionally to increase the ability to absorb losses, has been raised to up to 14 % as the capital regulation based on the Basel III standard is enforced from 2016. This is based on the addition of capital conservation capital ( 2.5 %p) and domestic system-critical banks (D-SIB) capital ( 1.0 %p) and economic response capital ( 2.5 %p) to the existing lowest common equity capital ratio. The economic response capital can be charged up to 2.5 %p during credit expansion and required economic response capital in Korea was increased from 0% to 1%, effective May 1,2024. As of December 31, 2024, the minimum regulatory BIS capital ratio to be observed is 12.5 %, which is the standard for applying capital conservation capital ( 2.5 %p), D-SIB capital ( 1.0 %p), and economic response capital ( 1.0 %p).

Basel III capital ratio is the concept of ‘International Agreement on the Measurement and Standards of Equity Capital’ of the Basel Bank Supervisory Commission of BIS (International Settlement Bank). It is calculated as ‘(common stock capital (after deduction of deductions) + other basic