Shin Han Bank President Hanyonggu: "Household Loans Not Easy This Year... Support for SMEs and Small Business Owners"

[Bank President New Year Interview] ② Shinhan Bank

[Asia Economy Reporter Bu Aeri] Han Yong-gu, CEO of Shinhan Bank, stated on the 19th, "The increase in household loans does not seem easy this year either," and added, "We will actively provide funds focusing on small and medium-sized enterprises (SMEs) and small business owners."

In an interview with Asia Economy, CEO Han diagnosed that due to personal debt management, the real estate market slump, and the impact of high interest rates, the increase in household loans will be difficult this year. In fact, household loans at the five major commercial banks?KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup?showed a continuous decline throughout last year, decreasing by 16.5194 trillion KRW.

CEO Han said, "We will actively support innovative growth companies, companies practicing ESG (Environmental, Social, and Governance) management, and business restructuring companies?SMEs that will lead the future national economy," and added, "We also plan to continue supporting vulnerable small business owners and micro-business owners who are expected to face difficulties."

Regarding the 'Leading Bank' strategy, CEO Han expressed his ambition, saying, "Being number one based on quantitative standards is important, but I want to lay the foundation to become a first-class bank recognized by society." Shinhan Financial Group reclaimed the 'Leading Bank' title by achieving a cumulative net profit of 4.3 trillion KRW as of the third quarter last year, surpassing KB Financial Group.

CEO Han plans to focus on a 'customer-centric' philosophy across this year's management strategy, evaluation system, overall work processes, and digital innovation. Regarding this year's strategic goals, he explained, "We plan to strengthen consumer protection and internal controls and promote sound business based on securing soundness." In the personnel reshuffle at Shinhan Bank conducted the day before, CEO Han also reinforced financial consumer protection and internal controls. A compliance management department, serving as the internal control control tower, was newly established, and dedicated internal control team leaders were assigned to each regional headquarters to prevent financial accidents in advance.

He particularly emphasized the professionalism of 'bankers.' He said, "Not only hardware changes but also software such as employee capabilities and culture must be supported," and stressed, "Through strengthening employee expertise this year, we will build a foundation to provide employees with pride through growth and offer customers a different level of banking."

Regarding the expansion of new global businesses such as mergers and acquisitions (M&A), CEO Han stated that efficiency will be prioritized for the time being. He said, "Although we have achieved outstanding results globally in recent years, external environments such as COVID-19 risks, economic recession, and strengthened financial regulations in various countries are challenging," and added, "We will move away from a growth strategy focused solely on expansion and invest more resources in channels with high capital efficiency."

CEO Han cited the complex crisis situation of high inflation, high exchange rates, and high interest rates as management threats this year. He said, "We will face significant challenges in managing soundness due to an increase in marginal companies and delinquent borrowers," and added, "We will focus on proactive soundness management while simultaneously providing tailored support to vulnerable borrowers."