Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 286

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 286
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4 primarily due to an increase in interest income on loans at amortized cost, including credit card loans and installment finance loans, which was partially offset by an increase in interest expenses on debt securities. The increase in interest income on loans at amortized cost was primarily due to higher interest rates applied to installment credit sales compared to 2023, as well as efforts to expand the credit card business of Shinhan Card, which resulted in an increase in the average balance of loans at amortized cost and related interest income for credit card loans and foreign currency installment finance loans. Interest expenses on debt securities increased mainly due to issuance of debt securities. Net fees and commission income decreased by 3.5% from W969 billion in 2023 to W935 billion in 2024 primarily as a result of a decrease in net fees income on credit cards, which was partially offset by an increase in fees and commission income from lease operations. Fees income on credit cards decreased primarily due to the effect of non-recurringfee income recognized during 2023 as a result of promotional agreements with MasterCard and Visa as well as a decrease in demand for credit card usage related to shopping and mobile payment services, while fee expenses on credit cards increased as a result of higher overseas credit card spending and the depreciation of the Korean Won against foreign currencies during 2024. Fees and commission income from lease operations increased primarily due to an increase in the average balance of operating lease assets denominated in Korean Won, resulting from the business expansion strategy for operating leases. Net other expense increased by 3.0% from W1,931 billion in 2023 to W1,988 billion in 2024, primarily due to an increase in net losses on foreign currency translation and an increase in provision for credit loss allowance, which were partially offset by an increase in net gains from hedging activities. Net losses on foreign currency translation increased due to the depreciation of the Korean Won against foreign currencies during 2024, resulting in increased translation losses on liabilities denominated in foreign currencies. Provision for credit loss allowance increased as a result of the rise in delinquent credit card receivables. Net gains from hedging activities increased primarily due to the strengthening of the U.S. Dollar against Korean Won, along with a rise in the volume of derivative transactions. Comparison of 2023 to 2022 Operating income for the credit card service increased by 6.0% from W880 billion in 2022 to W933 billion in 2023. 212

Net interest income increased