Company: SHG
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0001193125-25-089950
Chunk: 261

Company: SHINHAN FINANCIAL GROUP CO LTD
Filing Date: 2025-04-23
Form: 20-F
Chunk 261
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 liabilities increased primarily as a result of an increase in the base interest rate by the Bank of Korea during 2022 and 2023. The average balance increased for both interest-earning assets and interest-bearing liabilities. Shinhan Bank’s net interest income increased by 2.4% from W8,205 billion in 2022 to W8,403 billion in 2023. Net interest income after provision for loan losses amounted to W7,626 billion and W7,575 billion in 2022 and 2023, respectively. Shinhan Bank’s operating income decreased by 0.4% from W4,163 billion in 2022 to W4,147 billion in 2023.

From 2023 to 2024, both the average yield on interest-earning assets and the average rate on interest-bearing liabilities decreased, primarily as a result of the impact of the two base interest rate reductions by the Bank of Korea in 2024. The average balance increased for both interest-earning assets and interest-bearing liabilities. Shinhan Bank’s net interest income increased by 5.2% from W8,403 billion in 2023 to W8,837 billion in 2024. Net interest income after provision for loan losses amounted to W7,575 billion and W8,430 billion in 2023 and 2024, respectively. Shinhan Bank’s operating income increased by 22.0% from W4,147 billion in 2023 to W5,059 billion in 2024.

As for Shinhan Card, its operating revenue is largely dependent on transaction volume and less sensitive to interest rate movements than our banking business, since merchant fees (representing a fixed percentage of a credit card purchase amount) provide a stable source of income and our credit card business enjoys more diversified sources of funding, including commercial paper, corporate debentures (which have maturities longer than most bank deposit products) and asset-backed securitizations. The credit card transaction volume is largely dependent on the overall trends of the general Korean economy, such as general consumer spending patterns in

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**Korea. Shinhan Card’s operating revenues increased by 14.8% from W5,379 billion in 2023 to W6,173 billion in 2024, largely due to an increase in gains on hedging activities resulting from the strengthening of the U.S. Dollar against Korean Won, along with a rise in the volume of derivative transactions. In