/News1

Major financial holding companies, including the four major financial groups, will hold their regular shareholders' meetings this week to address key issues. Hana Financial Group, which holds its regular shareholders' meeting first, will vote on the reappointment of Chairperson Ham Young-joo. As last year the financial groups achieved record profits, the size of dividends in accordance with the 'value-up' plan and the introduction of tax-exempt dividends at Woori Bank are also drawing attention.

According to the financial sector on the 25th, starting with Hana Financial Group on this day, KB, Shinhan, Woori, IBK, BNK, DGB Financial, and KakaoBank will hold their shareholders' meetings on the 26th. JB Financial's shareholders' meeting will be held on the 27th.

Hana Financial Group will present the motion for Chairperson Ham's reappointment at the shareholders' meeting. Chairperson Ham, who was recommended as the sole candidate for the next chairperson earlier this year, amended the company bylaws to extend the term to three years. In a preliminary vote conducted by the Korea Securities Depository targeting foreign shareholders, approximately 63.7% of the total voting rights of foreign shareholders, or 123.6 million shares, were secured in favor, leading to expectations that the reappointment motion will pass without difficulty. The National Pension Service, which holds 9.68% of Hana Financial Group's equity, also decided to support Chairperson Ham's reappointment. If Chairperson Ham is successful in reappointing on this day, he will have an additional three-year term until March 2028.

The key issue on the 'super shareholders' meeting day' on the 26th is the introduction of tax-exempt dividends at Woori Financial Group. At Woori Financial's shareholders' meeting, a plan to allocate W3 trillion from capital surplus to retained earnings for use as dividend resources will be presented as an agenda item. If this motion passes, it will make Woori Financial the first financial holding company in South Korea to use W3 trillion in distributable income as tax-exempt dividend funds starting from this fiscal year.

If tax-exempt dividends are introduced, individual shareholders will be able to receive the full amount of dividends without the 15.4% tax deduction. Corporate shareholders will also benefit from deferred corporate tax effects. Because they can receive dividends without paying taxes, this is gaining attention as an emerging shareholder return policy.

Overview of the four major financial holding companies' headquarters. /News1

There are great expectations regarding the size of the dividends. Financial holding companies that achieved record profits last year have announced plans to increase the size of dividends this year according to their value-up plans. Including share buybacks and cancellations, KB Financial has proposed a total of W1.76 trillion in shareholder returns this year, while Shinhan Financial promised more than W1.75 trillion in shareholder returns. Hana Financial also decided to distribute W1.7 trillion in dividends this year.

Financial holding companies are also working to assemble a new team by significantly replacing outside directors. The four major financial groups plan to replace a total of 9 out of 23 outside directors whose terms are expiring. KB Financial and Shinhan Financial will each replace 2 outside directors, Hana Financial plans to replace 1, and Woori Financial will change 4 out of its 7 outside directors. This is an effort to enhance expertise and internal control. KakaoBank will also decide on CEO Yun Ho-young's fifth term at the shareholders' meeting on the 26th.

In addition, the four major financial holding companies will establish various committees and strengthen their related roles starting from this shareholders' meeting to enhance internal controls. Following a series of financial accidents, they aim to prioritize prevention over risk management. A representative from one financial holding company noted, "Among the issues faced by financial holding companies, restoring trust is currently the biggest challenge, so innovations related to this will be a focal point at this shareholders' meeting."