Shinhan Financial Group (055550) Q1 2026 earnings summary

Executive summary

• Q1 2026 net income rose 9% year-over-year to KRW 1,622.6 billion, driven by strong non-interest income and improved profitability metrics.

• ROE reached 11.9% and ROTCE 13.4%, both up 0.5 percentage points year-over-year, reflecting enhanced core earnings.

• CET1 ratio remained stable at 13.19%, despite a 16bp decline from end-2025, supported by solid capital generation.

• Achieved 50% shareholder return target ahead of schedule, with a focus on sustainable, predictable returns and capital efficiency.

• Board declared Q1 2026 cash dividend of KRW 740–741 per share and ongoing share buybacks, with immediate retirement of shares.

Financial highlights

• Net income for Q1 2026: KRW 1,622.6 billion, up 9% year-over-year.

• Net interest income increased 5.9% year-over-year; non-interest income surged 26.5% year-over-year, led by fee and commission growth.

• Cost income ratio declined to 36.7% (down 0.6 percentage points year-over-year).

• Group total assets grew 3.9% year-to-date to KRW 816.7 trillion, with loans up 2.9% and deposits up 3.2%.

• NPL ratio increased to 0.81% (up 9bp year-over-year), while NPL coverage ratio declined to 110%-113.6%.

Outlook and guidance

• Targeting ROE of 10%-12% through 2028, with phased strengthening of non-banking competitiveness.

• CET1 ratio to be maintained at 13%+, with excess capital returned to shareholders via dividends and buybacks.

• DPS expected to grow by more than 10% annually over the next three years.

• Shareholder return ratio projected in the 50%-60% range, with formula-based adjustments and annual Board-led gap analysis.

• Share buybacks and dividend increases to continue, aiming to reduce total shares to 450 million by end-2027.