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Provisions

12 Months Ended

Dec. 31, 2025

Disclosure of other provisions [abstract]

28.	Provisions

(a)

Provisions as of December 31, 2024 and 2025 are as follows:


	2024		2025
Asset retirement obligations	W	99,306		106,125
Expected loss related to litigation		114,750		144,173
Unused credit commitments		411,275		305,955
Guarantee contracts issued		104,451		111,307
Financial guarantee contracts issued		87,088		93,693
Non-financial guarantee contracts issued		17,363		17,614
Others (1), (2), (*3)		579,114		695,785

	W	1,308,896		1,363,345

(*1)

As of December 31, 2024 and 2025, the Group recognizes a provision of

317,857 million and

305,237 million, respectively, an estimated amount which is highly probable to be paid for customer losses expected due to delays in redemption of Lime CI funds, etc.

(*2)

As of December 31, 2024, the Group recognizes a provision of

25,856 million for vulnerable groups such as self-employed people, small business owners and institutions supporting vulnerable groups, etc. in accordance with the “Banking financial support plan for people’s livelihood.”

(*3)

As of December 31, 2024 and 2025, the Group recognizes a provision of

19,086 million and

8,643 million, respectively, for the estimated customer compensation amount related to equity-linked products based on the Hong Kong

H-Index

(Hang Seng China Enterprises Index).

(b)

Changes in provision for unused credit commitments and financial guarantee contracts issued for the years ended December 31, 2024 and 2025 are as follows:


	2024
	Unused credit commitments									Financial guarantee contracts issued									Total
	12-month expected credit losses			Lifetime expected credit losses			Impaired financial asset			12-month expected credit losses			Lifetime expected credit losses			Impaired financial asset			Total
Beginning balance	W	206,687			129,182			19,722			32,002			7,590			406			395,589
Transfer (from) to 12-month expected credit losses		68,071			(67,931	)		(140	)		4,968			(4,968	)		—			—
Transfer (from) to lifetime expected credit losses		(11,698	)		11,723			(25	)		(366	)		366			—			—
Transfer (from) to impaired financial asset		(806	)		(1,561	)		2,367			—			—			—			—
Provided (reversed)		(40,306	)		16,043			71,093			(3,783	)		(1,139	)		2			41,910
Change in foreign exchange rate		5,340			1,347			—			2,316			791			1			9,795
Other (*)		2,127			40			—			45,643			3,656			(397	)		51,069

Ending balance	W	229,415			88,843			93,017			80,780			6,296			12			498,363


	2025
	Unused credit commitments									Financial guarantee contracts issued									Total
	12-month expected credit losses			Lifetime expected credit losses			Impaired financial asset			12-month expected credit losses			Lifetime expected credit losses			Impaired financial asset			Total
Beginning balance	W	229,415			88,843			93,017			80,780			6,296			12			498,363
Transfer (from) to 12-month expected credit losses		48,121			(47,999	)		(122	)		1,420			(1,420	)		—			—
Transfer (from) to lifetime expected credit losses		(13,183	)		13,237			(54	)		(3,336	)		3,336			—			—
Transfer (from) to impaired financial asset		(767	)		(972	)		1,739			—			—			—			—
Provided (reversed)		(50,312	)		40,278			(91,457	)		(3,308	)		(1,077	)		(3	)		(105,879	)
Change in foreign exchange rate		(3,089	)		(445	)		—			(333	)		(154	)		1			(4,020	)
Other (*)		(295	)		—			—			6,915			4,573			(9	)		11,184

Ending balance	W	209,890			92,942			3,123			82,138			11,554			1			399,648

(*)	Includes the effects of new financial guarantee contracts initially measured at fair value, expirations of such contracts, and changes in discount rates, among others.

(c)

Changes in provisions for the years ended December 31, 2024 and 2025 are as follows:


	2024
	Asset retirement			Litigation			Guarantee			Other			Total
Beginning balance	W	99,927			31,371			23,163			819,616			974,077
Provision (reversal)		957			83,862			(8,471	)		293,407			369,755
Provision used		(7,282	)		(483	)		—			(533,232	)		(540,997	)
Change in foreign exchange rate		—			—			2,412			(483	)		1,929
Other (*)		5,704			—			259			(194	)		5,769

Ending balance	W	99,306			114,750			17,363			579,114			810,533

(*)	Includes increases in provisions due to the unwinding of discount and the effects of changes in discount rates, among others.


	2025
	Asset retirement			Litigation			Guarantee			Other			Total
Beginning balance	W	99,306			114,750			17,363			579,114			810,533
Provision (reversal)		6,739			26,032			404			315,971			349,146
Provision used		(3,363	)		(69,713	)		—			(131,149	)		(204,225	)
Change in foreign exchange rate		—			—			(245	)		166			(79	)
Other (*)		3,443			73,104			92			(68,317	)		8,322

Ending balance	W	106,125			144,173			17,614			695,785			963,697

(*)	During the year ended December 31, 2025, W 72,868 million of other provisions related to Shinhan Asset Trust Co., Ltd. were reclassified to provisions for litigation. The amount includes increases in the carrying amount of provisions from unwinding of the discount and changes in discount rates.

(d)

Asset retirement obligation liabilities represent the estimated cost to restore the existing leased properties which is discounted to the present value using the appropriate discount rate at the end of the reporting period. Disbursements of such costs are expected to incur at the end of lease contract. Such costs are reasonably estimated using the average lease year and the average restoration expenses. The average lease year is calculated based on the past

ten-year

historical data of the expired leases. The average restoration expense is calculated based on the actual costs incurred for the past three years using the three-year average inflation rate.

(e)

Allowance for guarantees and acceptances as of December 31, 2024 and 2025 are as follows:


	2024			2025
Outstanding guarantees and acceptances	W	15,315,381			18,642,539
Contingent guarantees and acceptances		5,068,782			4,917,473
ABS and ABCP purchase commitments		2,123,665			2,649,382
Endorsed bill		1,367			12,574

	W	22,509,195			26,221,968

Allowance for loss on guarantees and acceptances	W	104,451			111,307
Ratio		0.46	%		0.42