Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 274

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 274
---
 to 4.94% in 2024 from 5.10% in 2023. The average balance of corporate loans increased principally due to an increase in demand for funds, including working capital. The average lending rate for corporate loans decreased primarily as a result of the general decrease in market interest rates largely driven by the two base interest rate reductions by the Bank of Korea in 2024 as discussed above. |

197

| • |     | a 0.5% increase in interest on retail loans to W7,785 billion in 2024 from W7,747 billion in 2023, primarily due to a 4.1% increase in the average balance of retail loans to W160,529 billion in 2024 from W154,139 billion in 2023, which was partially offset by a decrease in the average lending rate for retail loans to 4.85% in 2024 from 5.03% in 2023. The average balance of retail loans increased primarily as a result of a decline in market interest rates and an increase in real estate prices, particularly in the Seoul metropolitan area, which resulted in an increase in mortgage loans. The average lending rate for retail loans decreased primarily as a result of the general decrease in market interest rates, largely driven by decreases in the base interest rate set by the Bank of Korea in 2024, as discussed above. The base interest rate set by the Bank of Korea affects the market interest rate for certificates of deposit, which in turn largely determines our lending rates for a substantial majority of our retail loans |

| • |     | Interest income on securities at fair value through other comprehensive income increased primarily due to an increase in the average yield of securities at fair value through other comprehensive income by 34 basis points to 3.10% in 2024 from 2.76% in 2023, driven by purchases of securities at fair value through other comprehensive income made during the period of rising interest rates, prior to the decline in market interest rates and the two base interest rate cuts in the second half of 2024 (the 3-year government bond yield closed at 3.15% at the end of 2023, but surged to 3.55% during 2024). |

Interest expense.Interest expense increased by 6.2% from W16,761 billion in 2023 to W17,807 billion in 2024, due primarily to a 24.6% increase in interest expense on