Shinhan Financial Group (055550) Q2 2025 earnings summary

Executive summary

• Net income for 2Q25 reached KRW 1.55 trillion, up 4.1% QoQ, driven by strong non-interest income despite higher credit costs.

• CET1 ratio improved to 13.59% (+32bp QoQ), reflecting robust capital management.

• Shareholder returns enhanced with a quarterly DPS of KRW 570 and a total 2025 share buyback of KRW 1.25 trillion.

• Digital and SDG initiatives advanced, with significant progress in green and inclusive finance.

Financial highlights

• Operating income before expenses for 2Q25 was KRW 4,129 billion, up 8.8% QoQ.

• Interest income grew 0.3% QoQ, while non-interest income surged 34.7% QoQ.

• Cost-to-income ratio (CIR) remained stable at 36.6% (-0.1% YoY).

• Credit cost ratio (CCR) increased to 0.50% (+18bp QoQ), reflecting prudent credit assessment.

• 1H25 net income rose 10.6% YoY, supported by solid fundamentals and absence of large one-off expenses.

Outlook and guidance

• Value-Up Plan execution to boost ROE and accelerate shareholder returns remains a priority.

• 2025 plan targets ROE improvement by 50bp or more, CET1 ratio above 13%, and swift share buybacks.

• Non-banking segment reforms and capital efficiency optimization are key focus areas.