Focus on Reigniting Growth Momentum

Shinhan Financial Group calls for mutual survival strategy to reform and improve its operations

The financial group, on the occasion of the 9th anniversary of its founding, announced on Sept. 1 the strategy for mutual survival management in a bid to maintain its role as a leading financial group and fully execute its social responsibility as a corporate citizen in Korea.
In this context, the group will secure 220 billion won in funds by 2013 and use it to support SMEs and help stabilize the livelihoods of families with low incomes in tune with the government’s focus on mutual survival with SMEs and the stable lives of the economically poor families around the country.
Under the strategy, the financial group will first support the SMEs contribution to the “Future Hope Fund,” which is designed to close the gap between the salary that SME employees dream about and their real pay and to help SMEs meet the salary needs for its new employees, allowing SMEs to create more jobs across the country.
Secondly, the bank will lower the financial burden on SMEs to help them increase investments and reduce the interest charged on their loans in order to build more plant facilities by creating 2.1 trillion won in special funds to be loaned to SMEs at concessionary rates.
The interest rates will be 1 percent per year for loans made during the first year and thereafter 0.2 percent will be charged per year during the remainder of the term of the loans to help SME borrowers save 42 billion won in interest charges based on an average six-year loan repayment period.
The bank also plans to cut interest rates on loans borrowed by those who live on government hand-outs and exempt various fees on financial transactions until 2012 so that they can cut their financial costs.
The bank will also cut interest rates on concessionary loans to persons or families with low incomes and whose credit ratings are low by 0.5 percent on those in the credit rating range of 4 to 6 and by 1 percent for those in the 7 to 10 range.
In the meantime, Shinhan Bank for the first time in the banking community, kicked off its marketing of gold bars on Aug. 20 with its logo engraved on them as a sign of authentication, the bank said.
The bank wanted to stop the practice of importing gold bars from overseas banks by domestic banks and selling them to customers with foreign bank logos imprinted on them.
The gold bars that the bank has been marketing are produced by LS-Nikko Zinc Refinery Co., the only copper refinery in Korea and listed on the Good Delivery List of the London Bullion Market Association (LBMA), the body that sets the standard for gold bar transactions around the world, officials of the bank said. The gold bars with Shinhan Bank logos have 99.99 percent gold contents in them, they said, adding that gold bars can be exchanged for cash in any country in the world.
The Shinhan Bank gold bars are being traded in two sizes; 1 kg and 100 grams and 36 of those who buy them from Aug. 20 to Oct. 31 will be entitled to various prizes if they win including air tickets, hotel accommodation vouchers, meal tickets at hotel buffets, and more, in addition to enjoying a number of events to be held during the period.
Shinhan Bank has now become a bullion bank, joining a number of well-known banks overseas providing services for investments in gold bars, the officials said.
The bank also will save $46 million by making use of gold bars produced in Korea, not importing gold bars from overseas annually if gold bar imports amount to more than 1.2 tons, which will also invigorate the gold market in the country. The bank will set up a foundation to export gold bars out of the country as a gold bullion bank, thereby boosting its brand value along with the international prestige of Korea, the officials said.
In the meantime, Shinhan Financial Group, through its philanthropic foundation set up in 2006 with 50 billion won in capital, has donated 5.3 billion won worth of scholarships to 1,610 students ranging from middle, high school and college so that they can continue to further their education and realize their dreams for their future.
The foundation implemented the Shinhan Mentoring Scholarship in December last year with 30 billion won in new funds. So far, 91 students have benefited from the mentoring scholarship. nw

Chairman Ra Eung-chan of Shinhan Financial Group.