Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 145

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 145
---
 in the amount of charge-offs for credit card loans in 2024 was mainly driven by the continued implementation of a proactive policy of writing off non-performingloans by Shinhan Card. Our gross charge-offs, including amortization of discount and disposal, increased by 54.3% from W1,152 billion in 2022 to W1,777 billion in 2023, primarily due to an overall increase in the amount of charge-offs for domestic loans in 2023 compared to 2022. The increase in the amount of charge-offs in 2023 was primarily due to write-offs for non-performing domesticloans to improve financial soundness by Shinhan Bank and Shinhan Card. In 2024, the charge-offon restructured loans amounted to W6 billion. With respect to a loan that we consider to be uncollectible regardless of any modification of terms, we convert a portion of such loan into equity securities following negotiation with the borrower and charge off the remainder of such loan. The equity securities so converted are recorded at fair value, based on the market value of such securities if available or the appraisal value of such securities by an outside appraiser if a market value is unavailable. In 2024, our loans restructured into equity securities amounted to W25 billion. We attempt to minimize loans to be charged off by practicing a sound credit approval process based on credit risk analysis prior to extending loans and a systematic management of outstanding loans. 95

Loans to be Charged-off Loans are charged off if they are deemed to be uncollectible by falling under any of the following categories:

| • |     | loans for which collection is not foreseeable due to insolvency or bankruptcy, dissolution or the termination of the debtor’s business; |

| • |     | loans for which collection is not foreseeable due to the death or disappearance of debtors; |

| • |     | loans for which collection expenses exceed the collectible amount; |

| • |     | loans for which collection is not possible through legal or any other means; |

| • |     | payments in arrears in respect of credit cards that are overdue for more than six months; |

| • |     | payments outstanding on unsecured retail loans that are overdue for more than 12 months; |

| • |     | payments in arrears in respect of leases that are overdue for more than 12 months; |

| • |     | the portion of loans classified as “estimated loss,” net of any recovery from