Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 291

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 291
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 which was driven by an increase in the number of interest days (leap year) and an increase in the average balance of government bonds resulting from an increase in long-term government bond purchases to extend the average maturity profile of our government bond assets. Interest income on securities at fair value through profit or loss decreased primarily due to a decrease in interest income on government bonds, resulting from a decrease in the average balance of government bonds as underlying assets of variable insurance decreased following an increase in claims paid. 215

Net fees and commission expense increased by 33.3% from W3 billion in 2023 to W4 billion in 2024 primarily due to an increase in brokerage fees expense in Korean Won, which was mainly driven by an increase in management fees through an alternative investment consignment arrangement entered into with Shinhan Asset Management in April 2024.

Net other income decreased by 0.7% from W853 billion in 2023 to W847 billion in 2024 primarily due to a decrease in net gain on financial instruments at fair value through profit or loss and an increase in other operating expenses, which were partially offset by an increase in net gain on foreign currency transactions and translation as well as a decrease in net insurance finance expense. The decrease in net gain on financial instruments at fair value through profit or loss was driven by a decrease in net valuation and transaction gains resulting from the decline in the stock market index in 2024 compared to 2023, as well as an increase in net transaction losses on currency-related derivatives due to the depreciation of the Korean Won against foreign currencies during 2024. The increase in other operating expenses was mainly due to an increase in net valuation loss related to hedging activities, primarily driven by the depreciation of the Korean Won against foreign currencies during 2024. The increase in net gain on foreign currency transactions and translation was primarily due to the depreciation of the Korean Won against foreign currencies during 2024. The decrease in net insurance finance expense was primarily due to a decrease in interest expenses on variable insurance liabilities, which are linked to the performance of underlying investment assets that incurred losses as a result of the decline in the KOSPI index.

Comparison of 2023 to 2022

Operating income for insurance services increased by 20.8% from W539 billion in 2022 to W651 billion in 2023.

Net interest expense increased by 60.5% from W124 billion in 2022 to W199 billion in 2023 primarily due to an increase in interest