Hye-jin Park • Daishin Securities Co., Ltd.

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Shinhan Card CFO Hae Chang Park responded that delinquencies, driven by self-employed businesses, are expected to improve from Q3, aided by a new internal collection organization. He noted that funding costs are at their peak and will decrease as market rates fall, which should help profitability recover to normal levels by the end of the year.

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Shinhan Card CFO Hae Chang Park attributed the higher delinquencies primarily to challenges faced by self-employed businesses but expects the situation to improve from Q3 due to a better economic environment and new internal collection measures. He stated that funding costs are at their peak and will decline as market rates fall, which should help profitability recover to normal levels by the end of the year.

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Sang-Hyuk Jung, the bank's CFO, stated that KRW 274 billion in nonoperating expense was recognized for ELS compensation, with no further impact expected at current index levels. He explained that the high refinancing volume was a strategic initiative to expand the customer base and the impact on margins was not material, noting that NIM actually improved by 2 basis points.

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CFO Lee Sung-Wook detailed a strategy to strengthen the securities arm's IB and digital capabilities, leveraging the bank's network for synergies. He noted that a KRW 500 billion capital increase was already completed late last year, providing sufficient funding for now. While mid-to-long-term increases may be needed for growth, no short-term capital injections are currently planned.

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An executive explained that based on a net non-cash asset and liability exposure of around USD 400 million, a KRW 10 change in the exchange rate results in a P&L impact of approximately KRW 4 billion. The same change would also affect the group's CET1 ratio by about 3 basis points.

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An executive explained that with approximately USD 400 million in non-cash assets and liabilities, a KRW 10 change in the exchange rate results in a P&L impact of around KRW 4 billion. They also noted this would have about a 3 basis point impact on the group's CET1 ratio.

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An executive explained that for every KRW 10 change in the USD/KRW exchange rate, the impact on P&L is approximately KRW 4 billion due to non-cash assets and liabilities. He also noted this would have about a 3 basis point impact on the CET1 ratio.

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Jae Kwan Kim, CFO of KB Securities, stated that the firm is not currently considering entering the IMA business but is monitoring trends, preferring to focus on its competitive strengths in identifying high-quality investment products. Regarding credit costs, he acknowledged the Q1 increase but expressed confidence that the annual target is manageable due to asset quality recovery efforts, stricter lending criteria, and an expectedly more stable macroeconomic environment in the second half.

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CFO Jae Kwan Kim explained that share buybacks will be implemented flexibly, considering income, shareholder return ratios, and market conditions, rather than on a fixed schedule. He confirmed that the KRW 860 billion provision for ELS compensation is considered a one-off factor, and given the rise in the H Index, no further losses are anticipated.

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