Shinhyup to Distribute 153.4 Billion KRW in Member Dividends This Year... 40% of Net Income Paid
Capital Contribution Dividends and Patronage Dividends of 143.8 Billion and 9.6 Billion Respectively
National Credit Unions' Average Dividend Rate 2.66%... Higher than Bank Interest Rates
[Asia Economy Reporter Song Seung-seop] On the 28th, Shinhan Credit Union announced that it paid 40% of last year's net income as dividends to its members.
This year, Shinhan Credit Union's capital dividends and usage dividends amount to 143.8 billion KRW and 9.6 billion KRW respectively, totaling 153.4 billion KRW. This dividend corresponds to 40.1% of the 2020 net income of 383.1 billion KRW. The average dividend rate of credit unions nationwide is 2.66%, exceeding last year's average bank fixed deposit interest rate (1-year maturity) of 1.16%. After closing the accounts at the end of last year and confirming the dividend rate through the general meeting of members in February 2021, the dividends were distributed in March.
Shinhan Credit Union is evaluated to have maintained the policy of ‘internal reserves first, member dividends later’ amid increasing economic uncertainty, while striving to secure high profitability. Kim Il-hwan, Head of Management Support at the Shinhan Credit Union Central Association, explained, “In recent years, due to prolonged ultra-low interest rates, capital contributions have been highlighted as a financial investment method for ordinary people who find it difficult to save large sums.” He added, “Small business owners and micro-entrepreneurs without retirement benefits can contribute small amounts monthly and, when deposited for a long period, can benefit from compound interest effects, allowing them to manage it like retirement funds.”
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Kim Yoon-sik, Chairman of the Central Association, stated, “Unlike commercial banks aiming for profit, Shinhan Credit Union shares most of its profits with its members,” and added, “It is also returned as social contribution projects necessary for community growth.”
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