Shinhan Financial Group on Wednesday announced and filed its corporate value enhancement plan, 'Shinhan Value Up 2.0'.

The plan was 추진됐다 as the need grew to set a new shareholder return standard, reflecting that the group achieved a 50 percent shareholder payout ratio early and proceeded with share buybacks and cancellations as planned, improving its price-to-book ratio (PBR).

The plan applies for three years from this year through 2028. A key change is moving away from an approach focused on individual targets and introducing a shareholder payout formula that links ROE and growth while managing the CET1 ratio at an appropriate level. Shinhan aims to shift to a structure in which earnings growth and shareholder returns expand together.

Shinhan previously set targets in July 2024 to achieve an ROE of 10 percent, a shareholder payout ratio of 50 percent and share buybacks and cancellations of at least 50 million shares by 2027. It later achieved key targets early, including recording a 50.2 percent shareholder payout ratio. It revamped its value-up policy to reflect these results and changes in the market environment.

Under version 2.0, Shinhan converted its existing 50 percent shareholder payout target into an uncapped shareholder return framework linked to ROE and growth. It will maintain its target of at least 10 percent ROE, apply a formula tied to growth, and manage the appropriateness of shareholder return levels through annual board reviews.

It also plans to reallocate capital among group units based on return on capital (ROC) and link that to performance evaluation and its compensation system to boost ROE. It will also pursue capital efficiency measures to strengthen competitiveness in its non-bank businesses.

Shinhan will also expand its shareholder return policy. It will implement tax-exempt dividends for three years starting with dividends based on 2026 results, and use remaining resources for its plan to buy back and cancel at least 50 million shares. It will keep its policy of equal quarterly dividends and plans to increase dividends per share by at least 10 percent each year.

It will also review progress on shareholder return implementation every year and continuously disclose updated three-year plans reflecting the reviews to strengthen communication with investors.

Jang Jeong-hoon (장정훈), vice president of finance at Shinhan Financial Group, said the plan is meaningful in building a structure in which group growth and shareholder returns form a virtuous cycle. He said Shinhan will raise corporate value through higher ROE and a predictable shareholder return framework.