Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 275

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 275
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 debt securities issued to W3,409 billion in 2024 from W2,735 billion in 2023 and a 4.4% increase in interest expenses on deposits to W10,221 billion in 2024 from W9,791 billion in 2023. Interest expense on debt securities issued increased primarily as a result of a 15.0% increase in the average balance of debt securities issued to W87,405 billion in 2024 from W75,999 billion in 2023, mainly driven by an increase in bond issuance to diversify our funding portfolio and to secure financing to meet the increase in long-term mortgage loans. Interest expense on deposits increased primarily due to a 5.7% increase in the average balance of deposits to W399,260 billion in 2024 from W377,612 billion in 2023, which was partially offset by a decrease in the average interest rate payable on deposits to 2.56% in 2024 from 2.59% in 2023. The increase in the average balance of deposits was primarily due to a 10.2% increase in the average balance of time deposits to W225,586 billion in 2024 from W204,743 billion in 2023, which was largely a result of a significant amount of matured funds from the Government policy products, such as the Youth Hope Installment Savings, being partially converted into time deposits during 2024. The decrease in the average interest rate payable on deposits resulted mainly from a decrease in the average interest rate payable on time deposits by 17 basis points to 3.66% in 2024 from 3.83% in 2023, which was largely a result of lower average market interest rates for 2024 compared to 2023 as described above. Net interest margin.Net interest margin represents the ratio of net interest income to the average balance of interest-earning assets. Net interest margin decreased by 2 basis points from 1.78% in 2023 and to 1.76% in 2024, largely due to an increase in the average volume of interest-earning assets mainly driven by the increase in the average balance of corporate loans as discussed above, outpacing the increase in net interest income. Net interest spread.Net interest spread, which represents the difference between the average rate of interest earned on interest-earning assets and the average rate of interest paid on interest-bearing liabilities, increased by 1 basis point from 1.55%