Shinhan Financial Group Co., Ltd. · KRX:055550

Shinhan Financial — Q1 2024 Earnings Presentation

37 slides from Shinhan Financial's earnings presentation, Apr 26, 2024

  1. Slide 1: Business Results 1Q 2024

    We believe finance should be SHG 2 Friendly, NYSE + More Secure, Creative _~.. Business Results :; ie. 1Q 2024 | =a @ ~ ns & é Le ttl - jo @ oe’ OF s eon @ Shinhan Financial Group

  2. Slide 2: Disclaimer

    Disclaimer The financial information contained herein has not been reviewed by independent auditors. Therefore, no assurance is given that the financial information is accurate or complete, and such financial information may differ from the financial information to be contained in our financial stat

  3. Slide 3: Contents

    Contents I. 1Q24 Result Highlights II. Financial Overview Ⅲ Financial Highlights by Subsidiaries The financial information contained herein has not been reviewed by independent auditors. Therefore, no assurance is given that the financial information contained herein is accurate or complete, and suc

  4. Slide 4: 1Q24 Result Highlights

    Ⅰ. 1Q24 Result Highlights

  5. Slide 5: 1Q24 Highlight

    1Q24 Highlight Movements (Consolidated basis, YoY) (KRW bn)  Plus factors Solid Fundamentals backed by robust top-line growth  Minus factors +3 Δ378 Net even with sizable non-operating expenses recognized 1.32 Wtn +242 Non- Interest Income* Δ0 Income - Net Income (Δ4.8% YoY), Operating Income befo

  6. Slide 6: [Note] Earnings Trend

    [Note] Earnings Trend Operating Income before Expenses / Net Income (KRW bn) BPS (KRW)  Operating Income before Expenses  Net Income 14,247 12,692 12,868 +6.9% 11,533 104,769 106,795 96,401 Δ4.8% 81,997 82,624 88,548 75,938 65,605 69,210 65,028 4,019 4,666 4,368 3,415 3,573 3,818 1,388 1,322 FY20

  7. Slide 7: Details of 1Q24 Result - ①

    Details of 1Q24 Result - ① Group Interest Income (KRW bn) KRW Loan Growth NIM Trend  Bank  Non-bank  Group NIM*  Retail YTD △ Corporate YTD  Total Loans YTD  Group  Bank  Annualized NIM 2.00% 12.3% 1.96% 1.97% 1.94% 11.2% 10.6% 10.6% 2.00% 2.00% 1.99% 1.97% 1.80% 1.81% 10,818 9.0% 9.0% 1.94%

  8. Slide 8: Details of 1Q24 Result - ②

    Details of 1Q24 Result - ② Non-interest Income (KRW bn) G&A Expense (KRW bn) Credit Cost (KRW bn)  Fees & Commission  Securities related  Insurance related  G&A Expenses  CIR (Cost to Income Ratio)  Bank  Card  Others  Nominal CCR  Recurring CCR  Others  Non-interest Income weight (Opera

  9. Slide 9: Details of 1Q24 Result - ③

    Details of 1Q24 Result - ③ Group Asset Quality RWA Movement ( %) FY2024 Shareholder Return  SHB Delinquency Rate  SHC Delinquency Rate  Decrease  Increase  Total  DPS(KRW)  Share cancellations (buyback) △ SHC 2M Delinquency Migration Rate 1.56% Shareholder 1.45% Return 0.42 (△14bp) 0.44 Flexi

  10. Slide 10: [Note] SFG Overseas Business & Real Estate PF Status

    [Note] SFG Overseas Business & Real Estate PF Status Net Income by Subsidiaries* (KRW bn) NI Contribution by Overseas Business* (KRW bn) Real Estate Financings (KRW bn)  Bank  Consumer Finance  Insurance  Capital Markets & Others  SBJ  Shinhan Bank Vietnam  Others  NI Contribution (%)  Real

  11. Slide 11: [Note] ELT Updates / Internal Control and Customer Protections

    [Note] ELT Updates / Internal Control and Customer Protections ELT Updates Adoption of the Responsibilities Map Customer Asset Risk Management Voluntary compensation based on the Implementation of a responsibilities map to Establishment of a system from the three- guidelines proposed by FSS clarify

  12. Slide 12: Digital, Digital to Value

    Digital, Digital to Value Platform Growth (in ten thousand persons) Profit Growth (KRW bn) Digital Highlights (1Q24) SFG Gross MAU 1 Digital Operating Profit before Digital Cost Efficiency3 MAU of AI Services  Financial  Non-financial Expenses2 • +59% YoY • MAU for Major Financial 3.75 million use

  13. Slide 13: ESG Initiatives

    ESG Initiatives CO2 Emissions Green Finance (Wtn) Inclusive Finance (Wtn)  Green Finance (New)  Green Finance (2020-2023 cumulative)  Inclusive Finance  Co-Prosperity Finance3) Scope 1 + 2 Emissions  Target  Emissions (thousand tCO2eq) 101.2 100.1 30.0 96.8 82.2 68.51) 67.5 14.7 57.3 13.3 1.4

  14. Slide 14: Financial Overview

    ll. Financial Overview

  15. Slide 15: Details of Interest Income

    ① Details of Interest Income (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % Operating Income before Expenses (a=b+c) 3,818.3 3,573.1 245.2 6.9% 3,818.3 3,270.2 548.1 16.8% Interest Income (b) 2,815.9 2,573.8 242.0 9.4% 2,815.9 2,786.6 29.3 1.1% Non-interest Income (c) 1,002.5 999.2 3.2 0.3% 1,002.

  16. Slide 16: Interest Income

    ② Interest Income Details of Interest Income (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % Interest Revenue (a) 7,190.5 6,492.9 697.6 10.7% 7,190.5 7,243.0 -52.6 -0.7% Loans 5,565.5 5,192.8 372.7 7.2% 5,565.5 5,644.7 -79.2 -1.4% Securities 1,342.4 1,057.6 284.8 26.9% 1,342.4 1,345.0 -2.5 -0.2% Ot

  17. Slide 17: Non-interest Income

    ③ Non-interest Income Details of Non-interest Income (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % Non-Interest Income 1,002.5 999.2 3.2 0.3% 1,002.5 483.7 518.8 107.3% Fees & Commission 703.4 603.4 100.0 16.6% 703.4 682.4 21.0 3.1% Securities related, FX Trading/Derivatives, & 493.0 611.5 -118.5

  18. Slide 18: G&A Expenses / Provision for Credit Losses

    ④ G&A Expenses / Provision for Credit Losses Details of G&A Expense (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % G&A Expense 1,372.2 1,355.9 16.3 1.2% 1,372.2 1,599.0 -226.7 -14.2% Salary & Employee benefits 853.0 874.9 -21.9 -2.5% 853.0 945.9 -92.9 -9.8% (Early Retirement Program Expenses) 5.1

  19. Slide 19: Asset Quality

    ⑤ Asset Quality Total Substandard & Loan Loss NPL (KRW bn) NPL Ratio Loans Below Allowance Coverage Ratio Normal Precautionary Substandard Doubtful Estimated Loss Group1 2024.3 403,772 396,775 4,480 1,133 627 758 2,517 0.62% 4,013 159% 2023.3 386,171 380,619 3,701 729 465 656 1,850 0.48% 3,575 193%

  20. Slide 20: Provisioning and Write-Offs

    ⑥ Provisioning and Write-Offs Provision for Credit Losses and Credit Cost Ratio (KRW bn) FY24 1Q24 2Q24 3Q24 4Q24 FY23 1Q23 2Q23 3Q23 4Q23 Shinhan Bank1 19.8 19.8 707.1 154.8 242.4 96.6 213.3 Retail 49.1 49.1 278.8 50.3 57.9 79.9 90.8 Corporate -29.2 -29.2 428.3 104.6 184.5 16.7 122.6 Shinhan Card1

  21. Slide 21: Capital Management and Profitability / Shareholder Return

    Capital Management and Profitability / Shareholder Return Group BIS Ratio Total Shareholder Return (incl. preferred shares) (KRW bn)  BIS ratio  Tier 1 ratio  CET 1 ratio  Cash dividend  Share cancellations (buyback)  TSR 36.0% 30.0% 16.2% 27.9% 16.1% 26.0% 26.0% 15.7% 486 16.0% 15.8% 23.9% 30

  22. Slide 22: Asset Quality

    Asset Quality Group Asset Quality (%) SHB Delinquency Rate  Precautionary & Below  Substandard & Below  SHB NPL Coverage Ratio  Group NPL Coverage Ratio 0.26% 0.32% Loans 0.24% 0.21% 0.26% 233% in KRW 0.19% 208% 209% 0.33% 0.42% 195% SME 0.32% 184% 0.30% (Incl. SOHO) 0.26% 0.26% 168% 202% 159% 1

  23. Slide 23: Financial Highlights by Subsidiaries

    Ⅲ. Financial Highlights by .Subsidiaries

  24. Slide 24: Financial Highlights by Subsidiaries

    ① Financial Highlights by Subsidiaries Shareholder's Profit for (KRW bn) Ownership Total Assets1 ROA ROE Equity the Period2 Bank 651,034.8 33,667.1 933.0 Shinhan Bank 100.0% 643,715.3 33,083.5 928.6 0.72% 11.19% Jeju Bank 75.3% 7,319.5 583.6 4.3 0.24% 3.13% Non-bank 390,686.3 24,627.2 491.2 Consumer

  25. Slide 25: SFG Subsidiaries Asset

    ② SFG Subsidiaries Asset (KRW bn) 2024.3 2024.3 2023.3 2023.12 YTD YTD % QoQ QoQ % Weight % Bank 651,034.8 591,944.0 59,090.8 10.0% 633,681.8 17,353.0 2.7% 62.5% Shinhan Bank 643,715.3 584,728.6 58,986.7 10.1% 626,439.4 17,276.0 2.8% 61.8% Jeju Bank 7,319.5 7,215.4 104.1 1.4% 7,242.4 77.1 1.1% 0.7%

  26. Slide 26: SFG Income by Subsidiaries

    ③ SFG Income by Subsidiaries (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % Bank (a) 933.0 934.9 -1.9 -0.2% 933.0 460.6 472.4 102.6% Shinhan Bank 928.6 931.5 -2.9 -0.3% 928.6 468.6 460.0 98.2% Jeju Bank 4.3 3.3 1.0 31.4% 4.3 -8.0 12.4 n.a. Non-bank (b) 491.2 549.7 -58.5 -10.6% 491.2 120.3 370.9 30

  27. Slide 27: Shinhan Bank Income (1)

    ④ Shinhan Bank Income (1) (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % Operating Income (a=b+c) 2,405.4 2,264.1 141.2 6.2% 2,405.4 2,046.8 358.6 17.5% Interest Income (b) 2,184.1 2,002.6 181.5 9.1% 2,184.1 2,146.3 37.8 1.8% Non-interest Income (c) 221.3 261.6 -40.3 -15.4% 221.3 -99.6 320.8 n.a.

  28. Slide 28: Shinhan Bank Income (2)

    ⑤ Shinhan Bank Income (2) (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % Non-interest Income (a+b+c) 221.3 261.6 -40.3 -15.4% 221.3 -99.6 320.8 n.a. Fee & Commission (a) 264.1 236.5 27.6 11.7% 264.1 220.9 43.2 19.5% Fund Fees 13.6 13.0 0.6 4.6% 13.6 13.2 0.4 3.4% Bancassurance Fees 18.3 8.7 9.7 11

  29. Slide 29: Shinhan Card Income

    ⑥ Shinhan Card Income (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % Operating Revenue (a) 1,530.0 1,365.0 165.0 12.1% 1,530.0 1,276.1 253.9 19.9% Card business 807.3 741.3 66.0 8.9% 807.3 821.4 -14.1 -1.7% Installment Finance 57.6 52.3 5.3 10.1% 57.6 58.6 -1.0 -1.7% Lease 189.7 166.4 23.4 14.1% 1

  30. Slide 30: Shinhan Life Insurance Income

    ⑦ Shinhan Life Insurance Income (KRW bn, %) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % APE1 515.4 225.3 +290.1 +128.8% 515.4 165.0 +350.4 +212.4% Protection 490.8 217.9 +272.9 +125.2% 490.8 159.1 +331.6 +208.4% Savings, Annuities 24.7 7.4 +17.2 +232.0% 24.7 5.9 +18.8 +318.9% Total Assets 57,759.0 58,08

  31. Slide 31: Shinhan Securities Income

    ⑧ Shinhan Securities Income (KRW bn) 1Q24 1Q23 1Q24 4Q23 YoY YoY % QoQ QoQ % Operating Revenue 316.7 340.0 -23.3 -6.9% 316.7 167.3 149.4 89.3% Fee & Commission 191.0 162.5 28.5 17.5% 191.0 170.3 20.6 12.1% Brokerage fees 102.9 81.4 21.4 26.3% 102.9 75.3 27.6 36.6% Financial Product fees 34.2 25.3 9.

  32. Slide 32: Shinhan Capital Income

    ⑨ Shinhan Capital Income (KRW bn) 1Q24 1Q23 1Q24 3Q23 YoY YoY % QoQ QoQ % Operating Income before Expenses (a=b+c-d-e) 127.7 194.1 -66.4 -34.2% 127.7 148.5 -20.8 -14.0% Interest Income (b) 141.5 139.2 2.4 1.7% 141.5 152.3 -10.7 -7.0% Non-interest Income (c) 217.1 190.3 26.8 14.1% 217.1 145.6 71.5 49

  33. Slide 33: Shinhan Bank Loans & Deposits

    ⑩ Shinhan Bank Loans & Deposits 2024.3 (KRW bn) 2024.3 2023.3 2023.12 YoY YoY % QoQ QoQ % Weight % Loans in KRW 298,183.1 281,519.2 16,663.9 5.9% 290,336.3 7,846.8 2.7% 100.0% Retail 131,161.4 129,311.1 1,850.3 1.4% 129,652.9 1,508.5 1.2% 44.0% Mortgage 63,428.9 60,068.4 3,360.5 5.6% 61,244.2 2,184.

  34. Slide 34: Shinhan Bank Loans (Retail, Large Corporates)

    ⑪ Shinhan Bank Loans (Retail, Large Corporates) Delinquency (KRW bn, %) 2024.3 Weight % 2023.3 2023.12 YoY YoY % QoQ QoQ % 2023.3 2023.6 2023.9 2023.12 2024.3 Mortgage Loans 63,429 48.4% 60,068 3,360 5.6% 61,244 2,185 3.6% 0.14% 0.15% 0.17% 0.19% 0.21% Personal Loans 67,733 51.6% 69,243 -1,510 -2.2%

  35. Slide 35: Shinhan Bank SME Loans

    ⑫ Shinhan Bank SME Loans Delinquency (KRW bn, %) 2024.3 Weight % 2023.3 2023.12 YoY YoY % QoQ QoQ % 2023.3 2023.6 2023.9 2023.12 2024.3 SME Total 133,570 100.0% 126,763 6,807 5.4% 129,954 3,616 2.8% 0.33% 0.32% 0.34% 0.32% 0.42% SOHO 67,093 50.2% 64,646 2,447 3.8% 65,733 1,360 2.1% 0.33% 0.32% 0.34%

  36. Slide 36: Shinhan Card Assets and Funding

    ⑬ Shinhan Card Assets and Funding 2024.3 (KRW bn, %) 2024.3 2023.3 2023.12 YoY YoY % QoQ QoQ % Weight % Earning Assets 38,421.7 38,487.0 -65.4 -0.2% 39,388.0 -966.4 -2.5% 100.0% Credit Purchase 17,587.2 17,705.1 -118.0 -0.7% 18,055.8 -468.6 -2.6% 45.8% Cash Advances 1,521.9 1,597.4 -75.4 -4.7% 1,585

  37. Slide 37: Additional Notes

    Additional Notes Notes on ‘Digital, Digital to Value’ (p.12) Note1) SFG Gross MAU’ is the sum of the MAU of Shinhan’s financial platforms and the MAU of Shinhan’s non-financial platforms. The MAU figures are based on managed data. * The MAU figures for financial platform represent the sum of MAUs of

Shinhan Financial Group — Q1 2024 Earnings Presentation on 6ix