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Shinhan Financial (SHG)
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Shinhan Financial Group Co (SHG) AI Stock Analysis

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SHG

Shinhan Financial Group Co

(NYSE:SHG)

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Outperform 70 (OpenAI - 4o)
Rating:70Outperform
Price Target:
$58.00
▲(9.58% Upside)
Shinhan Financial Group's stock is supported by strong technical indicators and attractive valuation metrics. However, financial performance is hindered by cash flow challenges and moderate leverage. The earnings call provided a mixed outlook with both positive shareholder returns and concerns over asset quality and income decline.

Shinhan Financial Group Co (SHG) vs. SPDR S&P 500 ETF (SPY)

Shinhan Financial Group Co Business Overview & Revenue Model

Company DescriptionShinhan Financial Group Co., Ltd. (SHG) is a leading financial services conglomerate based in South Korea, offering a comprehensive range of services including banking, insurance, asset management, and securities. Established in 2001, the group operates through its various subsidiaries, with Shinhan Bank being the flagship entity. The company focuses on providing personal and corporate banking services, wealth management, and investment solutions, catering to both domestic and international clients.
How the Company Makes MoneyShinhan Financial Group generates revenue primarily through its banking operations, including interest income from loans and mortgages, as well as fees from various financial services. The company earns significant income from its insurance segment through premiums collected and investment income from policyholder funds. Additionally, asset management and securities services contribute to revenue through management fees and commissions. The group has established partnerships with various domestic and international entities, enhancing its service offerings and market reach. Economic factors, interest rate fluctuations, and regulatory changes also play crucial roles in influencing the company's overall earnings.

Shinhan Financial Group Co Earnings Call Summary

Earnings Call Date:Oct 28, 2025
(Q3-2025)
|
% Change Since: |
Next Earnings Date:Feb 11, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with stable capital management and positive shareholder returns. However, challenges such as declined net income, increased RWA, and concerns over credit costs and asset quality were significant. While there were some positive aspects, notably in interest income growth and asset quality management, the lowlights indicate substantial areas of concern.
Q3-2025 Updates
Positive Updates
Stable CET1 Ratio
Shinhan Financial Group maintained a stable CET1 ratio of 13.56% by the end of September 2025, despite challenges such as won depreciation and loan asset growth.
Dividend and Share Buyback
The board resolved on a cash dividend of KRW 570 per share for Q3, with expected shareholder returns of KRW 2.35 trillion for 2025, including KRW 1.1 trillion in cash dividends and KRW 1.25 trillion in share buybacks.
Interest Income Growth
The group reported a 2.9% Q-o-Q rise in interest income due to profitability-based asset growth and active margin control, with the bank's loan in won increasing by 2.7% Q-o-Q.
Improved Asset Quality Management
The bank's NPL coverage ratio improved by 12.17 percentage points Q-o-Q, supported by NPL sales and strengthened asset quality management.
Negative Updates
Net Income Decline
Shinhan Financial Group's Q3 net income declined by 8.1% Q-o-Q, partly due to a decrease in securities-related profits reflecting market rate movements.
Increased RWA
The group's RWA increased by KRW 8 trillion Q-o-Q, driven by growth in foreign currency-denominated RWA due to won depreciation and loan-driven asset growth.
Credit Cost and Asset Quality Concerns
Credit cost ratio stood at 46 bp, up 2 bp YoY, with ongoing concerns about asset quality due to macroeconomic uncertainties.
Noninterest Income Decrease
The group's noninterest income decreased Q-o-Q, with declines in gains on securities, FX, and derivatives, although brokerage and IB-related fees surged.
Company Guidance
During the 2025 third-quarter earnings call for Shinhan Financial Group, several key financial metrics were discussed. The group's Common Equity Tier 1 (CET1) ratio was preliminarily estimated at 13.56%, showing stability despite challenges like the depreciation of the won. Shinhan Financial Group announced a cash dividend of KRW 570 per share for the quarter, with an expected total shareholder return of KRW 2.35 trillion for 2025, combining cash dividends and share buybacks. The group's net income for Q3 was KRW 1.4235 trillion, with a controlled credit cost ratio of 46 basis points, which increased by 2 basis points year-on-year but improved quarter-over-quarter. The cost/income ratio remained stable, and the return on equity (ROE) and return on tangible common equity (ROTCE) rose by 0.7 percentage points year-on-year to 11.1% and 12.5%, respectively. The bank's net interest margin (NIM) rose to 1.56%, up by 1 basis point quarter-over-quarter, while group interest income increased by 2.9% quarter-over-quarter. Noninterest income decreased due to market conditions, though brokerage and investment banking fees surged. The group's SG&A expenses rose by 2.2% quarter-on-quarter, and the credit cost decreased by 30.1% quarter-on-quarter. The NPL coverage ratio saw mixed results, with the bank's ratio improving by 12.17 percentage points quarter-on-quarter.

Shinhan Financial Group Co Financial Statement Overview

Summary
Shinhan Financial Group shows stable revenue growth and profitability with strong EBIT margins. However, moderate leverage and cash flow challenges, including negative growth in Free Cash Flow and Operating Cash Flow ratios, indicate potential liquidity issues.
Income Statement
70
Positive
Shinhan Financial Group demonstrated steady revenue growth with a Revenue Growth Rate of 3.03% from 2023 to 2024. The Gross Profit Margin remained consistent, as Total Revenue equaled Gross Profit. Net Profit Margin improved slightly to 3.05% in 2024. However, the EBIT margin showed minor fluctuation, maintaining a strong position at 59.74% in 2024. The absence of EBITDA data limits the depth of analysis.
Balance Sheet
65
Positive
The company's Debt-to-Equity Ratio stands at 2.34 in 2024, indicating a moderate level of leverage typical for the banking industry. Return on Equity (ROE) improved to 7.94% in 2024, reflecting effective use of equity. The Equity Ratio declined slightly to 7.58%, suggesting a small increase in financial leverage, which could pose some risks if not managed carefully.
Cash Flow
50
Neutral
Shinhan Financial Group experienced a significant decline in Free Cash Flow, leading to a negative Free Cash Flow Growth Rate. The Operating Cash Flow to Net Income Ratio was negative in 2024, indicating challenges in converting earnings into cash. The Free Cash Flow to Net Income Ratio was also negative, suggesting cash flow difficulties which need to be addressed to improve financial stability.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue35.27T35.38T14.18T13.25T25.75T11.59T
Gross Profit15.89T15.57T14.22T13.25T20.84T11.59T
EBITDA7.77T7.31T7.15T7.37T6.49T0.00
Net Income4.74T4.45T4.37T4.67T4.02T3.41T
Balance Sheet
Total Assets10.00T>10.00T>10.00T>10.00T>10.00T>10.00T>
Cash, Cash Equivalents and Short-Term Investments10.00T>10.00T>10.00T>94.21T94.37T92.87T
Total Debt10.00T>10.00T>10.00T>10.00T>10.00T>10.00T>
Total Liabilities10.00T>10.00T>10.00T>10.00T>10.00T>10.00T>
Stockholders Equity57.19T56.05T53.72T50.73T47.29T44.07T
Cash Flow
Free Cash Flow4.09T3.85T-186.39B6.65T10.19T-5.05T
Operating Cash Flow4.70T4.63T1.91T7.59T11.08T-4.41T
Investing Cash Flow-3.25T148.53B-4.27T-11.03T-12.03T-3.03T
Financing Cash Flow3.24T-182.65B8.38T3.39T4.96T7.88T

Shinhan Financial Group Co Technical Analysis

Technical Analysis Sentiment
Positive
Last Price52.93
Price Trends
50DMA
49.68
Positive
100DMA
48.64
Positive
200DMA
41.72
Positive
Market Momentum
MACD
0.79
Negative
RSI
61.50
Neutral
STOCH
67.71
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SHG, the sentiment is Positive. The current price of 52.93 is above the 20-day moving average (MA) of 51.23, above the 50-day MA of 49.68, and above the 200-day MA of 41.72, indicating a bullish trend. The MACD of 0.79 indicates Negative momentum. The RSI at 61.50 is Neutral, neither overbought nor oversold. The STOCH value of 67.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SHG.

Shinhan Financial Group Co Risk Analysis

Shinhan Financial Group Co disclosed 46 risk factors in its most recent earnings report. Shinhan Financial Group Co reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
The implementation of IFRS 17 beginning on January 1, 2023 renders certain of our historical financial information as of December 31, 2021 and for the year ended December 31, 2021, included in this annual report, not directly comparable with our financial information as of December 31, 2022 and 2023 and for the years ended December 31, 2022 and 2023 included in this annual report. Q4, 2023
2.
Evolving regulatory framework for artificial intelligence and machine learning technology, may have an adverse impact on our business, financial condition and results of operations. Q4, 2023
3.
Our business may be materially and adversely affected by legal claims and regulatory actions against us. Q4, 2023

Shinhan Financial Group Co Peers Comparison

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
$20.68B12.4218.54%5.29%5.16%27.77%
$34.32B9.9211.76%1.74%-4.58%39.03%
$24.82B7.722.23%-5.54%5.77%
$21.32B20.379.43%6.01%-3.77%-10.59%
$18.00B11.429.92%3.81%9.73%1.22%
$29.52B7.6910.14%2.31%-3.11%28.74%
$13.02B6.008.90%3.39%-3.55%1.59%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SHG
Shinhan Financial Group Co
52.65
14.83
39.21%
BBD
Banco Bradesco SA
3.39
1.08
46.75%
BSBR
Banco Santander Brasil
5.69
1.18
26.16%
BAP
Credicorp
260.00
85.53
49.02%
KB
Kb Financial Group
81.42
16.18
24.80%
WF
Woori Finance Holdings Co
53.73
20.07
59.63%

Shinhan Financial Group Co Corporate Events

Shinhan Financial Group Reports Q3 2025 Results with Revenue Decline
Oct 28, 2025

On October 28, 2025, Shinhan Financial Group announced its preliminary operating results for the third quarter of 2025. The results showed a significant decline in revenue compared to the previous quarter, with a 59.03% decrease. However, the company experienced a year-over-year increase in operating income and net income, indicating some resilience in its operations. These results reflect the challenges faced by the group in maintaining revenue levels, but also highlight its ability to improve profitability metrics over the year.

Shinhan Financial Group Announces Quarterly Dividend Payment
Oct 28, 2025

On October 28, 2025, Shinhan Financial Group’s Board of Directors resolved to distribute quarterly cash dividends amounting to KRW 273,597,111,810, equating to KRW 570 per share. The dividend is set to be paid on November 28, 2025, with a record date of November 4, 2025. This decision underscores the company’s commitment to returning value to its shareholders, although the final dividend amount may be adjusted based on the number of treasury shares acquired by the trustee by the record date.

Shinhan Financial Reports Change in Largest Shareholder’s Stake
Oct 24, 2025

On October 24, 2025, Shinhan Financial Group Co., Ltd. announced a change in the shareholding of its largest shareholder, Korea’s National Pension Service (NPS). The NPS’s ownership decreased from 9.30% to 9.13% between August 1 and September 30, 2025, reflecting a reduction of 838,556 shares. This change, based on the shareholder registry as of September 30, 2025, may impact the company’s shareholder dynamics and influence its market positioning.

Shinhan Financial Group Schedules 3Q2025 Earnings Release Conference
Oct 14, 2025

Shinhan Financial Group announced its 3Q2025 Earnings Release Conference scheduled for October 28, 2025. The event will be live-streamed and includes a Q&A session, allowing investors to engage directly. The announcement also marks a blackout period from October 14 to October 28, 2025, during which certain trading restrictions apply.

Shinhan Financial Group Denies Lotte Insurance Acquisition Rumors
Sep 12, 2025

On September 12, 2025, Shinhan Financial Group clarified that media reports suggesting the company is in the process of acquiring Lotte Insurance are false. This announcement aims to dispel any misinformation and maintain transparency with stakeholders, ensuring that the company’s strategic directions and operations are accurately understood by the market.

Shinhan Bank to Issue Contingent Capital Securities to Meet Basel III Standards
Aug 20, 2025

On August 20, 2025, the board of directors of Shinhan Bank, a wholly-owned subsidiary of Shinhan Financial Group, resolved to issue Write-down Contingent Capital Securities. This move is aimed at maintaining capital requirements under Basel III regulations. The issuance involves KRW 300 billion in Basel 3 Compliant Tier 2 Subordinated Debt, which will be written off if the bank is designated as an insolvent financial institution. This strategic decision underscores Shinhan’s commitment to regulatory compliance and financial stability, potentially impacting its stakeholders by ensuring the bank’s resilience in adverse financial conditions.

Shinhan Financial Group Releases 1H 2025 Business Report
Aug 14, 2025

On August 14, 2025, Shinhan Financial Group filed its 1H 2025 Business Report with the Financial Services Commission of Korea and the Korea Exchange. The report, prepared in accordance with Korean International Financial Reporting Standards, outlines the company’s financial performance and corporate governance details for the first half of 2025. The report indicates a stable financial position with total assets amounting to 37,978 billion won as of June 30, 2025, and a total equity of 27,701 billion won. This filing provides stakeholders with insights into the company’s financial health and strategic direction, reinforcing its position in the financial industry.

Shinhan Financial Group Announces Increase in Shares Held by Largest Shareholder
Aug 13, 2025

On August 13, 2025, Shinhan Financial Group Co., Ltd. announced a change in the shareholding of its largest shareholder, Korea’s National Pension Service (NPS). The NPS increased its holdings from 44,217,945 shares to 45,150,026 shares, representing a rise from 9.11% to 9.30% of common stock as of August 1, 2025. This change, based on the shareholder registry closing, signifies a strengthened position for NPS in Shinhan Financial Group, potentially impacting the company’s governance and strategic decisions.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Oct 28, 2025