KB Financial Group and Shinhan Financial Group are stepping up efforts on shareholder returns and inclusive finance.
KB Financial said April 23 it created 828.6 billion won in social value in the inclusive finance sector in the first quarter. By category, it reported 348.1 billion won tied to support for young people, small and midsize companies and self-employed small businesses, and balanced regional development, and 349.0 billion won related to public livelihood and safety. The group said the results reflect support for household stability and sustainable corporate growth through core financial services, along with social contribution programs that expanded needed local infrastructure.
KB Financial said it will further refine its return framework this year after posting cumulative social value of 2.414 trillion won through the third quarter of last year.
A KB Financial official said the group will use the measurement results to review the effectiveness of its social contribution programs and strengthen a sustainable support system so the value created spreads across local communities.
Shinhan Financial on April 23 announced "Shinhan Value-Up 2.0" and said it will adopt an "uncapped shareholder return ratio" linked to return on equity and growth. Under the plan, the shareholder return ratio would rise without a cap as the group grows.
In July 2024, Shinhan Financial said it aimed to achieve by 2027 a 50% shareholder return ratio, 10% ROE, and the purchase and retirement of at least 50 million shares. It said the shareholder return ratio reached 50.2% last year, meeting the target early. With its share retirement plan moving ahead and the price-to-book ratio normalizing, the group said it is now setting the new goal of an uncapped shareholder return ratio.
Shinhan Financial also said it will reallocate capital among group affiliates based on return on capital to strengthen nonbank competitiveness on the back of stable bank earnings. It said it plans to raise ROE by linking that approach to groupwide performance measurement, evaluation and compensation systems.
The group said it will begin tax-exempt dividends for three years starting with this year-end dividend, and use remaining resources to continue its plan to buy back and retire at least 50 million shares. It also said it will maintain equal quarterly dividends and target annual growth of at least 10% in dividends per share.
Shinhan Financial said it approved a first-quarter dividend of 740 won per share and is proceeding with a planned 700 billion won share buyback scheduled through July.
A Shinhan Financial official said the plan is significant because it builds a sustainable structure in which group growth and shareholder returns reinforce each other, adding that the company will seek to increase shareholder value through higher ROE and a predictable shareholder return framework.
* This article has been translated by AI.
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