UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 6-K
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REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the Month of March 2025
Commission File Number: 001-31798
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SHINHAN FINANCIAL GROUP CO., LTD.
(Translation of registrant's name into English)
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20, Sejong-daero 9-gil, Jung-gu, Seoul 04513, Korea
(Address of principal executive offices)
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Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F Form 40-F
Submission of Audit Report (Shinhan Card)
On March 4, 2025, Shinhan Financial Group disclosed audit reports of Shinhan Card, its wholly-owned subsidiary, for the fiscal year 2024 based on the International Financial Reporting Standards as adopted by the Republic of Korea.
The financial statements with external auditor's report are not yet approved by stockholder's meeting approval process, thus contents are subjected to be changed in the due course of the approval process
Please refer to Exhibit 99.1 and 99.2 for Independent Auditor’s Reports on consolidated and separate financial statements.
Exhibit 99.1 : Independent Consolidated Auditor’s Report of Shinhan Card as of December 31, 2024
Exhibit 99.2 : Independent Separate Auditor’s Report of Shinhan Card as of December 31, 2024
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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Shinhan Financial Group Co., Ltd. |
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(Registrant) |
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Date: March 04, 2025 |
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By: |
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/s/ CHUN Sang-yung |
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Name: CHUN Sang-yung |
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Title: Chief Financial Officer |
Exhibit 99.1 Consolidated Auditor’s Report of Shinhan Card
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Consolidated Financial Statements
December 31, 2024 and 2023
(With Independent Auditors’ Report Thereon)
Contents
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Page |
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Independent Auditors’ Report |
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1 |
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Consolidated Statements of Financial Position |
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3 |
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Consolidated Statements of Comprehensive Income |
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4 |
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Consolidated Statements of Changes in Equity |
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6 |
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Consolidated Statements of Cash Flows |
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8 |
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Notes to the Consolidated Financial Statements |
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Refer to Courtesy PDF |
Independent Auditors’ Report
Based on a report originally issued in Korean
To the Board of Directors and Shareholder of Shinhan Card Co., Ltd.
Opinion
We have audited the consolidated financial statements of Shinhan Card Co., Ltd.( and its subsidiaries (the “Group”), which comprise the consolidated statements of financial position as of December 31, 2024 and 2023, the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes, comprising of material accounting policy information and other explanatory information.
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2024 and 2023, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with Korean International Financial Reporting Standards (“K-IFRS”).
Basis for Opinion
We conducted our audits in accordance with Korean Standards on Auditing (KSAs). Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in the Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Other Matter
The procedures and practices utilized in the Republic of Korea to audit such consolidated financial statements may differ from those generally accepted and applied in other countries.
Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with K-IFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations.
Those charged with governance are responsible for overseeing the Group’s financial reporting process.
Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
•Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
•Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
•Evaluate the appropriateness of accounting policies used in the preparation of the consolidated financial statements and the reasonableness of accounting estimates and related disclosures made by management.
•Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.
•Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
•Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
KPMG Samjong Accounting Corp.
Seoul, Korea
March 4, 2025
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This report is effective as of March 4, 2025, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying consolidated financial statements and notes thereto. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any. |
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Financial Position
As of December 31, 2024 and 2023
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(In millions of won) |
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Note |
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2024 |
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2023 |
Assets |
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Cash and due from banks |
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10,40 |
W |
864,692 |
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587,523 |
Financial assets at fair value through profit or loss |
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11 |
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606,717 |
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951,025 |
Derivative assets |
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12 |
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670,186 |
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147,727 |
Credit card receivables at amortized cost and others |
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13 |
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37,267,649 |
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36,740,727 |
Lease assets |
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14 |
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2,133,859 |
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2,082,762 |
Financial assets at fair value through other comprehensive income |
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16 |
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378,530 |
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393,979 |
Property and equipment, net |
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15,17 |
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645,716 |
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638,694 |
Intangible assets |
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18 |
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228,428 |
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220,714 |
Investments in associates |
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19 |
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101,903 |
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92,456 |
Current tax assets |
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39 |
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4 |
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21,626 |
Deferred tax assets |
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39 |
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131,277 |
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129,403 |
Investment property |
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20 |
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45,642 |
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46,943 |
Net defined benefit assets |
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24 |
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5,011 |
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3,480 |
Other assets |
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21 |
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1,057,480 |
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1,363,103 |
Total assets |
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W |
44,137,094 |
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43,420,162 |
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Liabilities |
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Derivative liabilities |
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12 |
W |
6,100 |
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18,978 |
Borrowings |
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22 |
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6,550,378 |
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7,962,662 |
Debentures, net |
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23 |
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24,409,874 |
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21,650,752 |
Net defined benefit obligations |
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24 |
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173 |
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395 |
Current tax liabilities |
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39 |
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69,112 |
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85,786 |
Provisions |
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25 |
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220,948 |
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234,166 |
Other liabilities |
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15,26 |
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4,603,613 |
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5,412,436 |
Total liabilities |
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35,860,198 |
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35,365,175 |
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Equity |
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Common stock |
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27 |
W |
626,847 |
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626,847 |
Hybrid bonds |
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27 |
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699,822 |
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699,822 |
Capital surplus |
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27 |
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860,729 |
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860,729 |
Capital adjustments |
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27 |
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(2,354) |
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(1,548) |
Accumulated other comprehensive loss |
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27 |
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(79,023) |
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(55,952) |
Retained earnings |
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27,28 |
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6,147,734 |
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5,916,393 |
Equity attributable to owner of the Company |
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8,253,755 |
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8,046,291 |
Non-controlling interests |
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27 |
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23,141 |
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8,696 |
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Total equity |
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8,276,896 |
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8,054,987 |
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Total liabilities and equity |
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W |
44,137,094 |
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43,420,162 |
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The accompanying notes are an integral part of the consolidated financial statements.
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income
For the years ended December 31, 2024 and 2023
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(In millions of won, except earnings per share) |
Note |
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2024 |
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2023 |
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Interest income |
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W |
2,984,234 |
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2,840,691 |
Interest expense |
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(1,053,063) |
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(945,393) |
Net interest income |
32 |
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1,931,171 |
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1,895,298 |
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Fee and commission income |
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2,073,548 |
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2,070,601 |
Fee and commission expense |
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(1,305,206) |
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(1,275,360) |
Net fee and commission income |
33 |
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768,342 |
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795,241 |
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Dividend income |
34 |
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673 |
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611 |
Net gain on financial assets at fair value through profit or loss |
11 |
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24,795 |
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22,428 |
Net gain (loss) on derivatives |
12 |
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577,817 |
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69,041 |
Net gain (loss) on foreign currency transactions |
7 |
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(534,736) |
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(40,238) |
Provision for credit loss allowance |
35 |
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(917,238) |
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(883,956) |
General administrative expenses |
36 |
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(819,733) |
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(744,161) |
Other operating expense, net |
37 |
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(273,650) |
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(311,437) |
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Operating income |
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757,441 |
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802,827 |
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Non-operating income, net |
38 |
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12,081 |
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3,204 |
Share of gain (loss) of associates |
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(4,053) |
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(2,831) |
Profit before income tax |
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765,469 |
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803,200 |
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Income tax expense |
39 |
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(190,208) |
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(181,292) |
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Profit for the year |
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W |
575,261 |
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621,908 |
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Other comprehensive income (loss): |
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Items that will never be reclassified to profit or loss |
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Remeasurement of the net defined benefit obligations |
24,27 |
W |
(11,669) |
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(21,965) |
Net changes in the unrealized fair value of financial assets at fair value through other comprehensive income |
7,27 |
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(12,788) |
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1,969 |
Items that are or may be reclassified subsequently to profit or loss |
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Gain(Loss) on financial assets at fair value through other comprehensive income |
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4,469 |
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10,864 |
Net changes in the unrealized fair value of cash flow hedges |
12,27 |
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(18,379) |
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(26,712) |
Foreign currency translation adjustments for foreign operations |
27 |
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16,380 |
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(3,050) |
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Other comprehensive income (loss) for the year, net of tax |
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(21,987) |
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(38,894) |
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Total comprehensive income for the year |
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W |
553,274 |
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583,014 |
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income (continued)
For the years ended December 31, 2024 and 2023
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(In millions of won, except earnings per share) |
Note |
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2024 |
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2023 |
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Profit attributable to: |
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Equity holders of Shinhan Card Co., Ltd. |
30 |
W |
572,147 |
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620,582 |
Non-controlling interests |
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3,114 |
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1,326 |
Profit |
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W |
575,261 |
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621,908 |
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Total comprehensive income (loss) attributable to: |
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Equity holders of Shinhan Card Co., Ltd |
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W |
550,576 |
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581,882 |
Non-controlling interests |
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2,698 |
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1,132 |
Total comprehensive income |
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W |
553,274 |
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583,014 |
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Earnings per share Basic and diluted earnings per share (in won) |
30 |
W |
4,309 |
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4,710 |
The accompanying notes are an integral part of the consolidated financial statements
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Changes in Equity
For the year ended December 31, 2023
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2023 |
(In millions of won) |
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Common stock |
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Hybrid bonds |
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Capital surplus |
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Capital adjustments |
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Accumulated other comprehensive income (loss) |
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Retained earnings |
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Sub total |
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Non-controlling interests |
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Total equity |
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Balance at January 1, 2023 |
W |
626,847 |
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399,901 |
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860,729 |
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(1,550) |
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(17,253) |
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5,582,516 |
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7,451,190 |
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7,564 |
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7,458,754 |
Transactions with owner |
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Dividends |
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- |
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- |
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- |
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- |
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- |
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(256,631) |
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(256,631) |
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- |
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(256,631) |
Share-based payment transactions |
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- |
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- |
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- |
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2 |
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- |
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- |
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2 |
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- |
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2 |
Issuance of hybrid bonds |
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- |
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299,921 |
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- |
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- |
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- |
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- |
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299,921 |
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- |
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299,921 |
Dividend on hybrid bonds |
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- |
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- |
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- |
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- |
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- |
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(30,074) |
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(30,074) |
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- |
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(30,074) |
Total comprehensive income for the year: |
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Profit for the year |
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- |
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- |
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- |
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- |
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- |
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620,582 |
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620,582 |
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1,326 |
|
621,908 |
Remeasurement of the net defined benefit obligations |
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- |
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- |
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- |
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- |
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(21,964) |
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- |
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(21,964) |
|
- |
|
(21,964) |
Net changes in the unrealized fair value of financial assets at fair value through other comprehensive income |
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- |
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- |
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- |
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- |
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12,833 |
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- |
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12,833 |
|
- |
|
12,833 |
Net changes in the unrealized fair value of cash flow hedges |
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- |
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- |
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- |
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- |
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(26,712) |
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- |
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(26,712) |
|
- |
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(26,712) |
Foreign currency translation adjustments for foreign operations |
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- |
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- |
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- |
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- |
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(2,856) |
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- |
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(2,856) |
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(194) |
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(3,050) |
Balance at December 31, 2023 |
W |
626,847 |
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699,822 |
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860,729 |
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(1,548) |
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(55,952) |
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5,916,393 |
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8,046,291 |
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8,696 |
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8,054,987 |
The accompanying notes are an integral part of the consolidated financial statements.
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Changes in Equity (continued)
For the year ended December 31, 2024
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|
2024 |
(In millions of won) |
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Common stock |
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Hybrid bonds |
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Capital surplus |
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Capital adjustments |
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Accumulated other comprehensive income (loss) |
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Retained earnings |
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Sub total |
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Non-controlling interests |
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Total equity |
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Balance at January 1, 2024 |
W |
626,847 |
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699,822 |
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860,729 |
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(1,548) |
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(55,952) |
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5,916,393 |
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8,046,291 |
|
8,696 |
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8,054,987 |
Transactions with owner |
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|
|
|
|
|
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Dividends |
|
- |
|
- |
|
- |
|
- |
|
- |
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(310,415) |
|
(310,415) |
|
- |
|
(310,415) |
Net changes from business combination |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(31,891) |
|
(31,891) |
|
- |
|
(31,891) |
Total comprehensive income for the year: |
|
- |
|
- |
|
- |
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(806) |
|
- |
|
- |
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(806) |
|
11,746 |
|
10,940 |
Profit for the year |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remeasurement of the net defined benefit obligations |
|
- |
|
- |
|
- |
|
- |
|
- |
|
572,147 |
|
572,147 |
|
3,114 |
|
575,261 |
Net changes in the unrealized fair value of financial assets at fair value through other comprehensive income |
|
- |
|
- |
|
- |
|
- |
|
(11,669) |
|
- |
|
(11,669) |
|
- |
|
(11,669) |
Net changes in the unrealized fair value of cash flow hedges |
|
- |
|
- |
|
- |
|
- |
|
(9,819) |
|
1,500 |
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(8,319) |
|
- |
|
(8,319) |
Foreign currency translation adjustments for foreign operations |
|
- |
|
- |
|
- |
|
- |
|
(18,379) |
|
- |
|
(18,379) |
|
- |
|
(18,379) |
Balance at December 31, 2024 |
|
- |
|
- |
|
- |
|
- |
|
16,796 |
|
- |
|
16,796 |
|
(415) |
|
16,381 |
|
W |
626,847 |
|
699,822 |
|
860,729 |
|
(2,354) |
|
(79,023) |
|
6,147,734 |
|
8,253,755 |
|
23,141 |
|
8,276,896 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
The accompanying notes are an integral part of the consolidated financial statements
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (continued)
For the years ended December 31, 2024 and 2023
|
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(In millions of won) |
|
|
2024 |
|
2023 |
|
|
|
|
|
|
Cash flows from operating activities |
|
|
|
|
|
Profit for the year |
|
W |
575,261 |
|
621,908 |
Adjustment for: |
|
|
|
|
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Interest income |
|
|
(2,984,234) |
|
(2,840,691) |
Interest expense |
|
|
1,053,063 |
|
945,393 |
Dividend income |
|
|
(673) |
|
(611) |
Income tax expense |
|
|
190,208 |
|
181,292 |
Fee and commission income |
|
|
43,450 |
|
37,444 |
Fee and commission expense |
|
|
1,071 |
|
1,009 |
Net gain on sales of financial assets at fair value through profit or loss |
|
|
(2,110) |
|
(4,029) |
Net loss on sales of financial assets at fair value through profit or loss |
|
|
1 |
|
322 |
Net gain on valuation of financial assets at fair value through profit or loss |
|
|
(4,674) |
|
(7,266) |
Net loss on valuation of financial assets at fair value through profit or loss |
|
|
1,604 |
|
1,812 |
Net gain on valuation and transaction of derivatives |
|
|
(595,761) |
|
(81,106) |
Net loss on valuation and transaction of derivatives |
|
|
17,943 |
|
12,065 |
Net gain on foreign currency transaction |
|
|
(3,690) |
|
(1,946) |
Net loss on foreign currency transaction |
|
|
578,651 |
|
60,610 |
Provision for credit loss allowance |
|
|
917,238 |
|
883,957 |
Employee expenses |
|
|
25,729 |
|
20,783 |
Depreciation expenses |
|
|
85,542 |
|
73,325 |
Increase (decrease) in restoration liabilities |
|
|
18 |
|
(1,282) |
Other operating income |
|
|
- |
|
(11) |
Other operating expenses |
|
|
465,837 |
|
445,159 |
Non-operating income |
|
|
(634) |
|
(1,066) |
Non-operating expenses |
|
|
2,957 |
|
1,910 |
Equity method loss |
|
|
4,053 |
|
2,831 |
|
|
|
(204,411) |
|
(270,096) |
Changes in assets and liabilities: |
|
|
|
|
|
Restricted due from banks |
|
|
(10,339) |
|
153,053 |
Due from banks at amortized cost |
|
|
(150,300) |
|
(56,200) |
Financial assets at fair value through profit or loss |
|
|
360,365 |
|
(509,825) |
Credit card receivables at amortized cost and other |
|
|
(1,238,419) |
|
(640,905) |
Lease assets |
|
|
(517,046) |
|
(583,322) |
Other assets |
|
|
276,872 |
|
(307,359) |
Net defined benefit obligations |
|
|
(37,027) |
|
(11,718) |
Provisions |
|
|
(39,105) |
|
(37,261) |
Other liabilities |
|
|
(794,114) |
|
597,364 |
|
|
|
(2,149,113) |
|
(1,396,173) |
|
|
|
|
|
|
Income taxes paid |
|
|
(172,687) |
|
(167,982) |
Interest received |
|
|
2,817,178 |
|
2,691,567 |
Interest paid |
|
|
(872,258) |
|
(763,612) |
Dividend received |
|
|
673 |
|
611 |
Net cash inflow(outflow) from operating activities |
|
W |
(5,357) |
|
716,223 |
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (continued)
For the years ended December 31, 2024 and 2023
|
|
|
|
|
|
(In millions of won) |
|
|
2024 |
|
2023 |
Cash flows from investing activities |
|
|
|
|
|
Proceeds from disposal of financial assets at fair value through profit or loss |
|
W |
7,988 |
|
7,000 |
Acquisition of financial assets at fair value through profit or loss |
|
|
(18,865) |
|
(49,713) |
|
|
|
|
|
|
Proceeds from disposal of financial assets at fair value through other comprehensive income |
|
|
20,907 |
|
- |
Acquisition of financial assets at fair value through other comprehensive income |
|
|
(16,300) |
|
- |
Acquisition of investments in associates |
|
|
(13,500) |
|
(11,400) |
Proceeds from disposal of investments in associates |
|
|
- |
|
4,805 |
Proceeds from disposal of property and equipment |
|
|
1,429 |
|
1,019 |
Acquisition of property and equipment |
|
|
(32,975) |
|
(31,851) |
Proceeds from disposal of intangible assets |
|
|
1,446 |
|
758 |
Acquisition of intangible assets |
|
|
(27,845) |
|
(31,570) |
Decrease in security deposits paid |
|
|
8,041 |
|
1,224 |
Increase in security deposits paid |
|
|
(2,914) |
|
(7,820) |
Net cash outflow from investing activities |
|
W |
(72,588) |
|
(117,548) |
Cash flows from financing activities |
|
|
|
|
|
Proceeds from borrowings |
|
W |
1,421,207 |
|
934,737 |
Repayment of borrowings |
|
|
(3,073,789) |
|
(1,862,068) |
Proceeds from debentures |
|
|
9,544,871 |
|
7,488,226 |
Repayment of debentures |
|
|
(7,314,347) |
|
(7,392,194) |
Cash inflows from cash flow hedges |
|
|
2,773,828 |
|
1,535,439 |
Cash outflows from cash flow hedges |
|
|
(2,748,915) |
|
(1,457,988) |
Repayment of lease liabilities |
|
|
(15,256) |
|
(14,274) |
Dividends paid |
|
|
(310,415) |
|
(256,631) |
Increase in security deposits received |
|
|
(53,259) |
|
175,809 |
Issuance of hybrid bonds |
|
|
- |
|
299,921 |
Payment of dividend on hybrid bonds |
|
|
(31,884) |
|
(27,927) |
Increase in other financial liabilities |
|
|
- |
|
11,090 |
Decrease in other financial liabilities |
|
|
(10,640) |
|
(14,231) |
Increase in paid-in capital |
|
|
10,940 |
|
- |
Net cash outflow(inflow) from financing activities |
|
|
192,341 |
|
(580,091) |
|
|
|
|
|
|
Effect of exchange rate fluctuations on cash and cash equivalents |
|
|
2,134 |
|
865 |
|
|
|
|
|
|
Net increase in cash and cash equivalents |
|
|
116,530 |
|
19,449 |
|
|
|
|
|
|
Cash and cash equivalents at the beginning of year |
|
|
483,263 |
|
463,814 |
|
|
|
|
|
|
Cash and cash equivalents at the end of year (Note 40) |
|
W |
599,793 |
|
483,263 |
The accompanying notes are an integral part of the consolidated financial statements.
SHINHAN CARD CO., LTD. AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the years ended December 31, 2024 and 2023
(In millions of won)
Please refer to attached Courtesy PDF from page 10 to 126
Exhibit 99.2 Separate Auditor’s Report of Shinhan Card
SHINHAN CARD CO., LTD.
Separate Financial Statements
December 31, 2024 and 2023
(With Independent Auditors’ Report Thereon)
Contents
|
|
|
|
|
Page |
|
|
|
Independent Auditors’ Report |
|
1 |
|
|
|
Separate Statements of Financial Position |
|
3 |
|
|
|
Separate Statements of Comprehensive Income |
|
4 |
|
|
|
Separate Statements of Changes in Equity |
|
5 |
|
|
|
Separate Statements of Cash Flows |
|
6 |
|
|
|
Notes to the Separate Financial Statements |
|
Refer to Courtesy PDF |
|
|
|
Report on Independent Auditors’ Review of Internal Control over Financial Reporting |
|
123 |
|
|
|
Report on the Operations of Internal Accounting Control System |
|
124 |
|
|
|
Independent Auditors’ Report
Based on a report originally issued in Korean
To the Board of Directors and Shareholder of Shinhan Card Co., Ltd.
Opinion
We have audited the separate financial statements of Shinhan Card Co., Ltd.(the “Company”), which comprise the separate statements of financial position as of December 31, 2024 and 2023, the separate statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes, comprising of material accounting policy information and other explanatory information.
In our opinion, the accompanying separate financial statements present fairly, in all material respects, the separate financial position of the Company as of December 31, 2024 and 2023, and its separate financial performance and its separate cash flows for the years then ended in accordance with Korean International Financial Reporting Standards (“K-IFRS”).
Basis for Opinion
We conducted our audits in accordance with Korean Standards on Auditing (KSAs). Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Separate Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the separate financial statements in the Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Other Matter
The procedures and practices utilized in the Republic of Korea to audit such financial statements may differ from those generally accepted and applied in other countries.
Responsibilities of Management and Those Charged with Governance for the Separate Financial Statements
Management is responsible for the preparation and fair presentation of the separate financial statements in accordance with K-IFRS, and for such internal control as management determines is necessary to enable the preparation of separate financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the separate financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations.
Those charged with governance are responsible for overseeing the Company’s financial reporting process.
Auditors’ Responsibilities for the Audit of the Separate Financial Statements
Our objectives are to obtain reasonable assurance about whether the separate financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these separate financial statements.
As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
•Identify and assess the risks of material misstatement of the separate financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
•Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
•Evaluate the appropriateness of accounting policies used in the preparation of the separate financial statements and the reasonableness of accounting estimates and related disclosures made by management.
•Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the separate financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.
•Evaluate the overall presentation, structure and content of the separate financial statements, including the disclosures, and whether the separate financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
KPMG Samjong Accounting Corp.
March 4, 2025
Seoul, Korea
|
This report is effective as of March 4, 2025, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying separate financial statements and notes thereto. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any. |
SHINHAN CARD CO., LTD.
Separate Statements of Financial Position
As of December 31, 2024 and 2023
|
|
|
|
|
|
|
(In millions of won) |
|
Note |
|
2024 |
|
2023 |
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
Cash and due from banks |
|
10,40 |
W |
765,406 |
|
493,057 |
Financial assets at fair value through profit or loss |
|
11 |
|
1,086,138 |
|
1,513,207 |
Derivative assets |
|
12 |
|
460,365 |
|
147,690 |
Credit card receivables at amortized cost and other |
|
13 |
|
35,885,321 |
|
35,362,909 |
Lease assets |
|
14 |
|
2,133,970 |
|
2,082,812 |
Financial assets at fair value through other comprehensive income |
|
16 |
|
378,530 |
|
393,979 |
Property and equipment, net |
|
15,17 |
|
616,369 |
|
617,717 |
Intangible assets |
|
18 |
|
95,414 |
|
98,507 |
Investments in subsidiaries and others |
|
19 |
|
352,644 |
|
331,677 |
Current tax assets |
|
39 |
|
4 |
|
21,626 |
Deferred tax assets |
|
39 |
|
120,046 |
|
115,747 |
Investment properties |
|
20 |
|
45,642 |
|
46,943 |
Defined benefit assets |
|
24 |
|
4,791 |
|
3,480 |
Other assets |
|
21 |
|
1,070,685 |
|
1,372,791 |
Total assets |
|
|
W |
43,015,325 |
|
42,602,142 |
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Derivative liabilities |
|
12 |
W |
6,099 |
|
229 |
Borrowings |
|
22 |
|
9,146,092 |
|
9,739,749 |
Debentures, net |
|
23 |
|
20,858,700 |
|
19,282,427 |
Current tax liabilities |
|
39 |
|
71,066 |
|
87,386 |
Provisions |
|
25 |
|
220,830 |
|
232,105 |
Other liabilities |
|
15,26 |
|
4,550,400 |
|
5,289,129 |
Total liabilities |
|
|
W |
34,853,187 |
|
34,631,025 |
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
Common stock |
|
27 |
W |
626,847 |
|
626,847 |
Hybrid bonds |
|
27 |
|
699,822 |
|
699,822 |
Capital surplus |
|
27 |
|
860,592 |
|
860,592 |
Capital adjustments |
|
27 |
|
1,895 |
|
1,895 |
Accumulated other comprehensive loss |
|
27 |
|
(90,513) |
|
(60,158) |
Retained earnings |
|
27,28 |
|
6,063,495 |
|
5,842,119 |
Total equity |
|
|
W |
8,162,138 |
|
7,971,117 |
|
|
|
|
|
|
|
Total liabilities and equity |
|
|
W |
43,015,325 |
|
42,602,142 |
The accompanying notes are an integral part of the separate financial statements.
SHINHAN CARD CO., LTD.
Separate Statements of Comprehensive Income
For the years ended December 31, 2024 and 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won, except earnings per share) |
Note |
|
2024 |
|
2023 |
|
Interest income |
|
W |
2,772,751 |
|
2,636,469 |
|
Interest expense |
|
|
(988,584) |
|
(883,759) |
|
Net interest income |
32 |
|
1,784,167 |
|
1,752,710 |
|
|
|
|
|
|
|
|
Fee and commission income |
|
|
2,042,575 |
|
2,039,246 |
|
Fee and commission expense |
|
|
(1,307,632) |
|
(1,275,435) |
|
Net fee and commission income |
33 |
|
734,943 |
|
763,811 |
|
|
|
|
|
|
|
|
Dividend income |
34 |
|
315 |
|
382 |
|
Net gain on financial assets at fair value through profit or loss |
11 |
|
54,229 |
|
52,120 |
|
Net gain(loss) on derivatives |
12 |
|
320,735 |
|
31,434 |
|
Net gain(loss) on foreign currency transactions |
7 |
|
(278,945) |
|
9,882 |
|
Provision for credit loss allowance |
35 |
|
(852,319) |
|
(810,930) |
|
General administrative expenses |
36 |
|
(752,826) |
|
(684,361) |
|
Other operating expense, net |
37 |
|
(273,790) |
|
(311,843) |
|
|
|
|
|
|
|
|
Operating income |
|
|
736,509 |
|
803,205 |
|
|
|
|
|
|
|
|
Non-operating income, net |
38 |
|
11,970 |
|
2,383 |
|
|
|
|
|
|
|
|
Profit before income tax |
|
|
748,479 |
|
805,588 |
|
|
|
|
|
|
|
|
Income tax expense |
39 |
|
(186,298) |
|
(179,740) |
|
|
|
|
|
|
|
|
Profit for the year |
|
W |
562,181 |
|
625,848 |
|
|
|
|
|
|
|
|
Other comprehensive income (loss): |
|
|
|
|
|
|
Items that will never be reclassified to profit or loss |
|
|
|
|
|
|
Remeasurement of the net defined benefit obligations |
24,27 |
W |
(11,728) |
|
(21,314) |
|
Net changes in the unrealized fair value of financial assets at fair value through other comprehensive income |
7,27 |
|
(12,788) |
|
1,969 |
|
Items that are or may be reclassified subsequently to profit or loss |
|
|
|
|
|
|
Loss on financial assets at fair value through other comprehensive income |
|
|
4,469 |
|
10,864 |
|
Net changes in the unrealized fair value of cash flow hedges |
12,27 |
|
(8,808) |
|
(16,245) |
|
|
|
|
|
|
|
|
Other comprehensive income for the year, net of tax |
|
|
(28,855) |
|
(24,726) |
|
|
|
|
|
|
|
|
Total comprehensive income for the year |
|
W |
533,326 |
|
601,122 |
|
|
|
|
|
|
|
|
Earnings per share Basic and diluted earnings per share (in won) |
30 |
|
4,230 |
|
4,752 |
|
The accompanying notes are an integral part of the separate financial statements.
SHINHAN CARD CO., LTD.
Separate Statements of Changes in Equity
For the years ended December 31, 2024 and 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won) |
|
Common stock |
|
Hybrid bonds |
|
Capital surplus |
|
Capital adjustments |
|
Accumulated other comprehensive income (loss) |
|
Retained earnings |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2023 |
W |
626,847 |
|
399,901 |
|
860,592 |
|
1,893 |
|
(35,432) |
|
5,502,976 |
|
7,356,777 |
Transactions with the owner of the Company: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(256,631) |
|
(256,631) |
Share-based payment transactions |
|
- |
|
- |
|
- |
|
2 |
|
- |
|
- |
|
2 |
Issuance of hybrid bonds |
|
- |
|
299,921 |
|
- |
|
- |
|
- |
|
- |
|
299,921 |
Dividend on hybrid bonds |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(30,074) |
|
(30,074) |
Total comprehensive income for the year: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the year |
|
- |
|
- |
|
- |
|
- |
|
- |
|
625,848 |
|
625,848 |
Remeasurement of the net defined benefit obligations |
|
- |
|
- |
|
- |
|
- |
|
(21,314) |
|
- |
|
(21,314) |
Net changes in the unrealized fair value of financial assets at fair value through other comprehensive income |
|
- |
|
- |
|
- |
|
- |
|
12,833 |
|
- |
|
12,833 |
Net changes in the unrealized fair value of cash flow hedges |
|
- |
|
- |
|
- |
|
- |
|
(16,245) |
|
- |
|
(16,245) |
Balance at December 31, 2023 |
W |
626,847 |
|
699,822 |
|
860,592 |
|
1,895 |
|
(60,158) |
|
5,842,119 |
|
7,971,117 |
Balance at January 1, 2024 |
W |
626,847 |
|
699,822 |
|
860,592 |
|
1,895 |
|
(60,158) |
|
5,842,119 |
|
7,971,117 |
Transactions with the owner of the Company: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(310,415) |
|
(310,415) |
Dividend on hybrid bonds |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(31,890) |
|
(31,890) |
Total comprehensive income for the year: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the year |
|
- |
|
- |
|
- |
|
- |
|
- |
|
562,181 |
|
562,181 |
Remeasurement of the net defined benefit obligations |
|
- |
|
- |
|
- |
|
- |
|
(11,728) |
|
- |
|
(11,728) |
Net changes in the unrealized fair value of financial assets at fair value through other comprehensive income |
|
- |
|
- |
|
- |
|
- |
|
(9,819) |
|
1,500 |
|
(8,319) |
Net changes in the unrealized fair value of cash flow hedges |
|
- |
|
- |
|
- |
|
- |
|
(8,808) |
|
- |
|
(8,808) |
Balance at December 31, 2024 |
W |
626,847 |
|
699,822 |
|
860,592 |
|
1,895 |
|
(90,513) |
|
6,063,495 |
|
8,162,138 |
The accompanying notes are an integral part of the separate financial statements.
SHINHAN CARD CO., LTD.
Separate Statements ofCash Flows
For the years ended December 31, 2024 and 2023
|
|
|
|
|
|
(In millions of won) |
|
|
2024 |
|
2023 |
Cash flows from operating activities |
|
|
|
|
|
Profit for the year |
|
W |
562,182 |
|
625,848 |
Adjustments for: |
|
|
|
|
|
Interest income |
|
|
(2,772,751) |
|
(2,636,469) |
Interest expense |
|
|
988,584 |
|
883,759 |
Dividend income |
|
|
(315) |
|
(382) |
Income tax expense |
|
|
186,298 |
|
179,740 |
Fee and commission income |
|
|
43,450 |
|
37,444 |
Fee and commission expense |
|
|
1,071 |
|
1,009 |
Net gain on sale of financial assets at fair value through profit or loss |
|
|
(2,110) |
|
(4,029) |
Net loss on sale of financial assets at fair value through profit or loss |
|
|
- |
|
322 |
Net gain on valuation of financial assets at fair value through profit or loss |
|
|
(4,314) |
|
(7,164) |
Net loss on valuation of financial assets at fair value through profit or loss |
|
|
1,604 |
|
1,806 |
Net gain on derivatives |
|
|
(328,023) |
|
(33,334) |
Net loss on derivatives |
|
|
7,288 |
|
1,900 |
Net gain on foreign currency transactions |
|
|
(20,728) |
|
(2,532) |
Net loss on foreign currency transactions |
|
|
340,682 |
|
33,813 |
Provision for credit loss allowance |
|
|
852,319 |
|
810,930 |
Employee-related expenses |
|
|
24,911 |
|
20,093 |
Depreciation expenses |
|
|
74,435 |
|
61,979 |
Increase in provision for restoration |
|
|
18 |
|
(1,282) |
Other operating expenses |
|
|
466,068 |
|
445,122 |
Non-operating income |
|
|
(554) |
|
(1,036) |
Non-operating expenses |
|
|
2,160 |
|
1,906 |
|
|
|
(139,907) |
|
(206,405) |
Changes in assets and liabilities: |
|
|
|
|
|
Due from banks at amortized cost |
|
|
(150,000) |
|
(50,000) |
Financial assets at fair value through profit or loss |
|
|
440,365 |
|
(604,809) |
Credit card receivables at amortized cost and other |
|
|
(1,169,186) |
|
(328,472) |
Lease assets |
|
|
(517,034) |
|
(583,175) |
Other assets |
|
|
254,556 |
|
(143,310) |
Net defined benefit obligations |
|
|
(35,959) |
|
(10,632) |
Provisions |
|
|
(38,968) |
|
(37,261) |
Other liabilities |
|
|
(802,211) |
|
592,608 |
|
|
|
(2,018,437) |
|
(1,165,051) |
|
|
|
|
|
|
Income taxes paid |
|
|
(174,406) |
|
(161,906) |
Interest received |
|
|
2,607,552 |
|
2,489,477 |
Interest paid |
|
|
(807,260) |
|
(701,926) |
Dividend received |
|
|
315 |
|
382 |
Net cash inflow from operating activities |
|
W |
30,039 |
|
880,419 |
SHINHAN CARD CO., LTD.
Separate Statements ofCash Flows (continued)
For the years ended December 31, 2024 and 2023
|
|
|
|
|
|
(In millions of won) |
|
2024 |
|
2023 |
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
Proceeds from disposal of financial assets at fair value through profit or loss |
W |
7,791 |
|
7,000 |
Acquisition of financial assets at fair value through profit or loss |
|
(16,266) |
|
(41,931) |
Proceeds from disposal of financial assets at fair value through other comprehensive income |
|
20,907 |
|
- |
Acquisition of financial assets at fair value through other comprehensive income |
|
(16,300) |
|
- |
Proceeds from disposal of investments in subsidiaries and others |
|
- |
|
4,805 |
Acquisition of investments in subsidiaries and others |
|
(20,968) |
|
(11,400) |
Proceeds from disposal of property and equipment |
|
1,287 |
|
970 |
Acquisition of property and equipment |
|
(31,853) |
|
(30,670) |
Proceeds from disposal of intangible assets |
|
1,407 |
|
758 |
Acquisition of intangible assets |
|
(26,203) |
|
(29,219) |
Decrease in security deposits paid |
|
7,691 |
|
1,141 |
Increase in security deposits paid |
|
(2,565) |
|
(6,372) |
Net cash outflow from investing activities |
W |
(75,072) |
|
(104,918) |
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Proceeds from borrowings |
W |
1,558,607 |
|
855,200 |
Repayment of borrowings |
|
(2,360,000) |
|
(2,496,701) |
Proceeds from debentures |
|
8,217,527 |
|
7,163,981 |
Repayment of debentures |
|
(6,910,000) |
|
(6,380,000) |
Cash inflows from cash flow hedges |
|
945,714 |
|
- |
Cash outflows from cash flow hedges |
|
(943,750) |
|
- |
Repayment of lease liabilities |
|
(10,197) |
|
(8,957) |
Dividends paid |
|
(310,415) |
|
(256,631) |
Increase in security deposits received |
|
11,780 |
|
110,818 |
Issuance of hybrid bonds |
|
- |
|
299,921 |
Payment of dividend on hybrid bonds |
|
(31,884) |
|
(27,927) |
Net cash inflow (outflow) from financing activities |
|
167,382 |
|
(740,296) |
|
|
|
|
|
Net increase in cash and cash equivalents |
|
122,349 |
|
35,205 |
|
|
|
|
|
Cash and cash equivalents at the beginning of the year |
|
443,021 |
|
407,816 |
|
|
|
|
|
Cash and cash equivalents at the end of the year (Note 40) |
W |
565,370 |
|
443,021 |
See accompanying notes to the separated financial statements.
SHINHAN CARD CO., LTD.
Notes to the Separate Financial Statements
For the years ended December 31, 2024 and 2023
Please refer to Courtesy PDF from page 8 to 122
Independent Auditors’ Review Report on Internal Control over Financial Reporting
(Based on a report originally issued in Korean)
To the Shareholders and board of directors of
Shinhan Card Co., Ltd.
We have reviewed the accompanying Internal Controls over Financial Reporting Operating Status Report (the “ICFR Report”) of Shinhan Card Co., Ltd. (the “Company”) as of December 31, 2024. The Company's management is responsible for designing and maintaining effective ICFR and for its assessment of the effectiveness of ICFR. Our responsibility is to review management's assessment and issue a report based on our review. In the accompanying report of management’s assessment of ICFR, it is stated that: “Based on our assessment, we concluded that the Company’s ICFR is designed and operated effectively as of December 31, 2024 in all material respects, in accordance with the ‘Conceptual Framework for Designing and Operating Internal Control over Financial Reporting’.
We conducted our review in accordance with ICFR Review Standards issued by the Korean Institute of Certified Public Accountants. Those standards require that we plan and perform the review to obtain assurance of a level less than that of an audit as to whether the Company’s ICFR Report is free of material misstatement. Our review consists principally of obtaining an understanding of the Company’s ICFR, inquiries of company personnel about the details of the report, and tracing to related documents we considered necessary in the circumstances.
A company's ICFR is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with Korean International Financial Reporting Standards (“K-IFRS”). A company's ICFR includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company, (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with K-IFRS, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, ICFR may not prevent or detect material misstatements in the financial statements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Based on our review of the Company’s ICFR Report, nothing has come to our attention that causes us to believe that the ICFR Report as of December 31, 2024 is not prepared in all material respects, in accordance with the Management Guideline for Evaluation and Reporting of Internal Control over Financial Reporting issued by the ICFR Committee.
This report applies to the Company’s ICFR in existence as of December 31, 2024. We did not review the Company’s ICFR subsequent to December 31, 2024. This report has been prepared for Korean regulatory purposes, pursuant to the Act on External Audit of Stock Companies, Etc. and may not be appropriate for other purposes or for other users.
KPMG Samjong Accounting Corp.
March 4, 2025
|
This report is annexed in relation to the audit of the financial statements as of and for the year ended December 31, 2024. |
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