Vision and Detailed Plans for This Year Shared Through Letter to Shareholders
"Deep Reflection on Securities ETF Incident" and Commitment to Strengthening Internal Controls
Jin Ok-dong, Chairman of Shinhan Financial Group, stated on the 30th, "Size and profit and loss do not guarantee future survival," and added, "We will focus on qualitative growth to create a sustainable company."
According to Shinhan Financial Group on the 30th, Chairman Jin emphasized 'sustainability' as the group's top priority value in a recent letter to shareholders.
The company explained that Chairman Jin expressed his hopes for Shinhan Financial's sustainable growth in the letter by likening the expectations he had for his first child on the day of birth to the founder's mindset.
As a detailed plan to secure sustainability, Chairman Jin proposed thorough risk management, honest communication to strengthen internal controls, continuous implementation of corporate value enhancement plans to increase shareholder value, and qualitative growth through sustainable profitability.
Chairman Jin emphasized, "Through the corporate value enhancement plan announced last year, we are focusing more on the development of the capital market and the expansion of shareholder value," adding, "We will do our best to represent shareholders' positions and find constructive agreements through active communication with financial authorities."
He also referred to last year's incident involving Shinhan Securities' Exchange-Traded Fund (ETF) liquidity provider (LP), stating, "Based on a painful reflection, we have identified problems in the internal control system and are strongly implementing improvement measures," and added, "We have secured sufficient loss absorption capacity in preparation for the increasing uncertainties in the financial market, such as real estate project financing (PF) issues, and will continue proactive risk management through careful monitoring."
For 'qualitative growth,' he brought up keywords such as improving management efficiency and managing asset soundness. In particular, he stated that through cost-efficiency efforts, they will stably manage the operating profit expense ratio, Common Equity Tier 1 (CET1) ratio, and risk-weighted assets (RWA), and pursue margin management focused on profitability.
He promised, "We plan to diversify the group's revenue structure to expand non-interest income, such as developing the wealth management (WM) business centered on PIB (Private Banking + Corporate Finance) business," and added, "Overseas, we will build differentiated business strategies based on the localization know-how accumulated in Vietnam and Japan to further expand our business models."
Quoting a phrase from deontological ethics, "Trustworthiness comes from carrying out what one says," Chairman Jin emphasized, "We will do our best to achieve the goals of a 10% return on equity (ROE), a 50% shareholder return ratio, and a reduction of 50 million shares by 2027."
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