Shinhan Bank Revises Evaluation of Treasury Asset Value... 150 Billion KRW Write-down in Q4

[Asia Economy Reporter Kwon Haeyoung] Shinhan Financial Group reduced the valuation of intangible assets related to the 'institutional treasury' business acquisition by approximately 150 billion KRW in the fourth quarter. This was in response to the Financial Supervisory Service's directive not to inflate future intangible gains from treasury acquisitions in the financial results.

No Yonghoon, Vice Chairman of Shinhan Financial Group, stated during the conference call held after the announcement of the '2019 Management Performance Status' on the 5th, "(Regarding Shinhan Bank's fourth-quarter performance) there was a 120 billion KRW expense for voluntary retirement and a 150 billion KRW impairment of intangible assets related to the city treasury."

He added, "Excluding one-time expenses and considering one-time asset sales and reversal of provisions, the estimated ordinary profit for the fourth quarter is 696 billion KRW," and noted, "(Shinhan Bank's fourth-quarter performance) is not worse compared to other years." Shinhan Bank's net profit for the fourth quarter was recorded at 507.5 billion KRW, a 1.1% decrease compared to the same period last year, but when one-time expenses are accounted for, the performance exceeds that of the previous year.

Meanwhile, the Financial Supervisory Service pointed out the asset valuation method for local government contributions, including the Seoul city treasury, during the comprehensive inspection of Shinhan Bank conducted in the second half of last year and recommended a revaluation of the assets. Shinhan Bank accepted the Financial Supervisory Service's recommendation and reflected it in the fourth-quarter performance results.

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