Shinhan Bank Indonesia to anchor operating holding structure
Partnership with Sinar Mas Group, Indonesia's fourth-largest conglomerate
Jin says group will deliver 'differentiated financial value' to local customers
Shinhan Financial Group announced Tuesday that it has become the first South Korean financial group to establish a financial holding company in Indonesia, building an integrated operating structure spanning banking, card and securities services while partnering with a major local conglomerate to expand its global business.
The group held a launch ceremony for Shinhan Financial Group Indonesia in Jakarta on Monday. The move follows the conversion of Shinhan Bank Indonesia into an operating holding company that also serves as the local financial holding entity. Shinhan Financial Group Chairman Jin Ok-dong and senior officials from Indonesian financial regulators attended the ceremony.
The conversion was driven by Indonesia's financial regulator, which in December 2024 made it mandatory for financial firms to establish holding company structures — a measure aimed at clarifying ownership, reducing conflicts of interest, strengthening risk-absorption capacity and improving supervisory efficiency. Shinhan Financial received regulatory approval from Indonesian authorities in September last year and completed its governance restructuring on Sept. 16 after finishing share transfer procedures. The South Korean Embassy in Indonesia and the Korea-ASEAN Financial Cooperation Center also provided support throughout the process.
Under the new structure, Shinhan Bank Indonesia functions as both a bank and a holding company. The bank acquired partial stakes in Shinhan Indo Finance and Shinhan Securities Indonesia — local subsidiaries previously held by Shinhan Card and Shinhan Securities, respectively — giving it a stake of 50 percent plus one share in each entity. The group plans to strengthen collaboration among its subsidiaries and improve decision-making efficiency under the new holding company framework.
Alongside the holding company launch, Shinhan Financial is expanding its local industry network to diversify its business. On the day of the ceremony, the group signed an MOU with Sinar Mas Group, Indonesia's fourth-largest conglomerate. Sinar Mas has been broadening its reach beyond its core palm oil and paper businesses into energy, telecommunications, IT, financial services and real estate.
The two sides plan to cooperate in corporate finance and supply chain finance, combining Sinar Mas's local industry network with Shinhan Financial's financial capabilities to identify new business opportunities.
Shinhan Financial has grown its Indonesian operations over the past decade or so into a comprehensive financial group employing about 900 local staff. Shinhan Bank Indonesia, which now serves as the local holding company, has posted consistent earnings growth — its net profit, converted to won, rose from 7.7 billion won ($5.75 million) in 2023 to 16.4 billion won in 2024 and 22.3 billion won last year. In the first half of this year, the bank recorded net profit of 11.2 billion won.
Chairman Jin, who has consistently emphasized synergies among overseas subsidiaries and partnerships with local companies, is credited with driving the expansion in Indonesia. Shinhan Financial became the first South Korean financial holding company to surpass 1 trillion won in global pre-tax profit last year, and earnings continued to grow in the first half of this year. The group has set "differentiated competitiveness" and "sustained growth" as its core global priorities for this year, targeting a top market position in each country where it operates.
"With the launch of the financial holding company, we now have the foundation to run our Indonesian operations as a single integrated system," Jin said. "This MOU is a new step toward expanding our local business. Together with Sinar Mas Group, we will deliver differentiated financial value to customers in Indonesia and contribute to the economic development of the two countries."
forest@heraldcorp.com
