3Q Cumulative Net Profit 3.5594 Trillion KRW... 20.7% Increase YoY
3Q Cumulative Record High Performance... Balanced Growth in Banking and Non-Banking
3Q Cumulative ROE 11.0%... Double-Digit for 5 Consecutive Years
[Asia Economy Reporter Kwangho Lee] Shinhan Financial Group achieved a net profit exceeding 1 trillion KRW in the third quarter of this year, setting a new record for cumulative performance. This has turned on a green light for reaching a net profit of 4 trillion KRW this year.
On the 26th, Shinhan Financial announced that its cumulative net profit for the third quarter of this year reached 3.5594 trillion KRW, a 20.7% increase compared to the same period last year (2.9502 trillion KRW). This is the highest cumulative performance on record for the third quarter.
For the third quarter alone, the net profit was 1.1157 trillion KRW, slightly down from 1.1447 trillion KRW in the same period last year.
A Shinhan Financial official explained, "We continuously improved ordinary profit through selective asset growth and proactive risk management," adding, "Non-bank group companies such as Shinhan Life and Asia Trust, incorporated through inorganic growth (M&A) strategies with capital market-related subsidiaries like Capital and GIB, posted favorable results, reaffirming the strengths of the group's diversified portfolio."
The group's cumulative return on equity (ROE) for the third quarter was 11.0%, marking five consecutive years of double-digit ROE for the third quarter. In particular, profitability in capital market sectors such as Capital and GIB contributed to an expanded profit contribution from the non-bank sector. The group's capital market segment profit for the third quarter cumulative period was 656.2 billion KRW, a 39.7% increase compared to the same period last year.
Shinhan Life, born from the merger of Shinhan Life Insurance and Orange Life on July 1, recorded a cumulative profit of 401.9 billion KRW for the third quarter, a 4.5% increase compared to the same period last year, continuously expanding the influence of the non-bank sector. The non-bank sector's profit increased by 30.5% year-on-year to 1.6544 trillion KRW, with its profit share improving by 2 percentage points to 43% compared to the same period last year.
The banking sector pursued a selective asset growth strategy focused on high-quality corporate clients. Through this, core interest income increased by 10.2% year-on-year to 6.6621 trillion KRW.
The group's credit cost decreased by 46.2% year-on-year to 565.3 billion KRW due to a growth strategy centered on high-quality assets and proactive risk management efforts. The credit cost ratio also declined by 0.21 percentage points year-on-year to 0.21%, maintaining a downward stabilization trend.
Shinhan Financial continued to support the real economy through the COVID-19 financial support program. Additionally, in preparation for the end of the COVID-19 financial support program, it proactively responded to future uncertainties by setting aside an additional 390 billion KRW in COVID-related reserves last year.
Shinhan Financial is continuously accelerating its digital transformation (DT) strategy, including strengthening core digital platform competitiveness and pioneering future new markets. Through the 'One Shinhan Connect New Technology Investment Fund No.1,' a 300 billion KRW digital strategic investment (SI) fund established in April?the first of its kind among domestic financial companies?it has invested a total of 140 billion KRW in nine companies as of the end of September.
Furthermore, by renewing Shinhan Plus and launching Shinhan pLay, the group strengthened the competitiveness of its integrated payment platform. It is accelerating the digital transformation of group businesses through enhancing O2O-based lifestyle platforms and pursuing business convergence by investing in fintech companies such as Douzone Bizon.
Meanwhile, Shinhan Financial decided through a board resolution to continue quarterly dividends this quarter, as implemented from the previous quarter. Considering the ongoing COVID-19 situation, it plans to pay 260 KRW per share, slightly down from 300 KRW per share in the previous quarter. The final dividend payout ratio will be determined after confirming the annual profit and loss at the fourth-quarter board meeting.
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