Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 83

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 83
---
-to-value ratio of up to 80%, and in the case of mortgage loans obtained through auction winnings, the loan may be granted regardless of the regulatory status of the area, provided that the loan amount does not exceed W400 million. Furthermore, such victims may be exempt from the application of debt-to-income ratio and debt service ratios regulations.

Furthermore, in July 2024, special provisions were introduced to support homeowners who need to return lease deposits. Homeowners who completed the ownership transfer registration and signed lease contracts before July 3, 2023 and are required to return the lease deposit pursuant to a lease contract expiring prior to December 31, 2025 will be eligible for a housing mortgage loan, including loans secured by office-tels (mixed purpose units serving simultaneously as office and residential apartments), provided they meet certain eligibility criteria. In such cases, the loan may be extended within a DTI limit of 60%.

Meanwhile, in December 2023, as a measure to help prevent excessive household debt, the Financial Services Commission introduced the “stress debt service ratio” system for floating rate loans, mixed rate loans (loans where a fixed interest rate shifts to a floating interest rate after a certain period of time), and periodic loans (loans where a fixed interest rate is adjusted periodically). The “stress debt service ratio” system imposes a certain level of interest rate spread (a stress rate) when calculating the debt service ratio, taking into consideration the possibility that a borrower of a floating rate loan may be subject to an increased burden when repaying principal and interest if the interest rate were to increase during the loan period. The “stress debt service ratio” system was initially applied beginning February 26, 2024 to mortgage loans in the banking sector. Since September 1, 2024, the application of the “stress debt service ratio” system was expanded to mortgage loans across all financial institutions as well as credit facilities in the banking sector. The application of the “stress debt

<div align='center'>50</div>

service ratio” system is expected to further expand to mortgage loans, credit facilities and other loans across all financial institutions beginning July 2025. In addition, the supervising authorities in Korea from time to time issue administrative instructions to Korean banks, which have the effect of regulating the access of borrowers to housing loans and, as such, demand for real estate properties. For example, the Financial Supervisory Service issued administrative instructions to financial institutions to (except in limited circumstances) verify the borrower’s ability to repay based