SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934

SHINHAN FINANCIAL GROUP CO., LTD.

(Translation of registrant’s name into English)

120, 2-Ga, Taepyung-Ro, Jung-Gu, Seoul 100-102, Korea
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will
file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F þ Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(1): o

Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(7): o

Indicate by check mark whether the registrant by furnishing the
information contained in this form is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.

Yes o No þ

If “Yes” is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-                    .

 

 

Tender Offer Circular

Submitted to the Financial Supervisory Commission
June 12, 2007

We hereby submit this Tender Offer Circular
in accordance with Article 21-2(2) of the Securities and Exchange Act (of Korea).

Reporter		Name		Shinhan Financial Group Co., Ltd. (seal)
Contact Information for Business Purpose		Address*		120 Taepyungro 2-ga, Jung-gu, Seoul, Korea
		Tel. No.		82-2- 6360-3035

TABLE OF CONTENTS

I. Particulars on Tender Offeror and Its Specially-Related Persons			1
II. The Issuer of the Shares Subject to the Tender Offer			16
III. Purpose of The Tender Offer			27
IV. Class and Number of Shares Subject to the Tender Offer			28
V. Period, Price, Settlement Date and Other Terms of the Tender Offer			30
VI. Particulars of Agreement to Purchase Target Company’s Shares Other than by Means of Tender Offer After Public Notice Date			32
VII. Details of Funding for Purchase			33
VIII. Particulars on Tender Offer Agent			34
IX. Current Status of Target Company			37
X. Procedures of the Tender Offer			39
XI. Source of Funding			43
XII. Tender Offeror and Its Specially-Related Persons’ Share Ownership Status and Transaction History of Target Company’s Shares Within Past One Year			44
XIII. Agreements Between Tender Offeror and Offices/Major Shareholders of Target Company			45
XIV. Future Plans Regarding Target Company After the Tender Offer			45
XV. Particulars on Intermediary of the Tender Offer			46
XVI. Place Where the Tender Offer Circular and Tender Offer Documents will be Publicly Available			46
Exhibit 1			50

I. Particulars on Tender Offeror and Its Specially-Related Persons

A. Information on Tender Offeror and Its Specially-Related Persons

1. Name of Tender Offeror

Name of Tender Offeror:		Shinhan Financial Group Co., Ltd. (“SFG”)
Representative Director:		In Ho LEE

2. History of Tender Offeror

(1) Changes since Incorporation

	1)		Date of Incorporation: September 1, 2001
	2)		Location of Head Office (including any changes thereof): 120 Taepyungro 2-ga, Jung-gu, Seoul, Korea
	3)		Material Change in the Management

2001.9.1		Chairman of BOD		Eung Chan RA
2003.3.31		Chairman of BOD		Eung Chan RA
		President & CEO		Young Hwi CHOI
2005.5.17		Chairman of BOD		Eung Chan RA
		President & CEO		In Ho LEE

4)

Changes in the Largest Shareholder

2001.12.7		Changed from Daekyo Co., Ltd. and two other shareholders (No. of shares held: 4,754,679; shareholding ratio: 1.63%) to BNP Paribas (No. of shares held: 11,693,767; shareholding ratio: 4%)
2002.2.7		Changed from BNP Paribas to BNP Paribas Luxembourg, an affiliate of BNP Paribas (No. of shares held: 11,693,767; shareholding ratio: 4%)
2005.3.22		Changed from BNP Paribas Luxembourg to Korea National Pension Fund (No. of shares held: 16,498,516; shareholding ratio: 5.17%)
		* The above date is the date on which the change was confirmed.
2005.11.28		Changed from Korea National Pension Fund to Korea Deposit Insurance Corporation (No. of shares held: 22,360,302; shareholding ratio: 6.22%; convertible and redeemable preferred stocks were converted into common shares)
2006.4.11		Changed from Korea Deposit Insurance Corporation to BNP Paribas Group (No. of shares held: 33,682,104; shareholding ratio: 9.38%)
		* Details of Holding:
		•    BNP Paribas S.A.: 20,124,272 shares (purchased common shares in SFG held by Korea Deposit Insurance Corporation);
		•    BNP Paribas Luxembourg (subsidiary of BNP Paribas S.A.): 13,557,832 shares (existing shares)
		* The above information is based on the date of purchase and sale of the shares. As of September 30, 2006, the shareholding ratio of BNP Paribas Group is 8.83% (the shareholding ratio was reduced due to the increase in the total number of common shares).

		* As of December 31, 2006, BNP Paribas Group owns 9.06% or 34,582,732 shares of SFG common shares.

	5)		Material Change in Business Purpose: N/A
	6)		Other Material Change since Incorporation

2002.4.4		Executed a stock purchase agreement with Korea Deposit Insurance Corporation to acquire 51% equity in Jeju Bank
2002.4.8		Executed a stock purchase agreement with Asia Pacific Group II and LP, among others, to acquire 30% of common shares in Good Morning Securities Co., Ltd.
2002.5.10		SFG’s inclusion of Jeju Bank as its subsidiary was officially granted
2002.6.4		Shinhan Bank’s Credit Card Business spun off and Shinhan Card Co., Ltd. was established
2002.7.8		Shinhan Credit Information Co., Ltd. was established
2002.8.1		Good Morning Securities Co., Ltd. merged with Shinhan Securities Co., Ltd.; Good Morning Shinhan Securities Co., Ltd. was incorporated
2002.9.16		Good Morning Investment Trust Management Co., Ltd. ceased to be one of SFG’s indirect subsidiaries
2002.9.23		Executed an agreement to sell (50% minus 1) shares in Shinhan Investment Trust Management to BNP Paribas Group; name changed to Shinhan-BNP Paribas Investment Trust Management Co., Ltd.
2002.10.1		Established SH&C Life Insurance Co., Ltd.
2003.6.9		Executed an agreement to sell 49% equity share in Shinhan Credit Information to Lone Star Fund
2003.7.9		Executed an agreement to acquire 80.04% equity in Chohung Bank from Korea Deposit Insurance Corporation
2003.8.18-19		Acquired 80.04% equity in Chohung Bank from Korea Deposit Insurance Corporation
2003.9.5		SFG’s inclusion of Chohung Bank as its subsidiary was officially granted
2003.9.16		Registered with the U.S. Securities Exchange Commission and listed on the New York Stock Exchange
2003.11.20		Acquired a U.S. bank holding company license from the U.S. Federal Reserve Board
2003.12.26		Made additional investment of KRW 200 billion in Chohung Bank (shareholding ratio after investment: 81.15%)
2004.3.5		Shinhan Bank sold out 29,873,359 (10.15%) shares of SFG
2004.4.12		Decided to acquire shares of Chohung Bank through stock swap and tender offer and acquired it as SFG’s wholly-owned subsidiary
2004.4.29		Terminated business alliance with Lone Star Fund in the credit information sector and decided to acquire shares of Shinhan Credit Information held by Lone Star Fund
		* On May 21, 2004, acquired the remaining 49% of the shares (shareholding ratio after acquisition: 100%)
2004.6.22		Stock swap to acquire Chohung Bank as SFG’s wholly-owned subsidiary was completed
		* Shareholding ratio after the stock swap: 100%; no. of SFG common shares increased by 14,682,590 shares
2004.12.16		SFG acquired Shinhan Private Equity Co., Ltd. as its wholly

		owned subsidiary
		* Date of report on inclusion as subsidiary to Financial Supervisory Commission (“FSC”): Jan. 5, 2005
2004.12.23		Stock swap to acquire Good Morning Shinhan Securities as SFG’s wholly-owned subsidiary was completed
		* Shareholding ratio after the stock swap: 100%; no. of SFG common shares increased by 10,235,121 shares
2005.8.26		Decided to liquidate e-Shinhan
2005.8.29		Acquired Shinhan NPS Private Equity Fund 1st as SFG’s indirect subsidiary
2005.9.27		Decided to acquire Shinhan Life Insurance Co., Ltd. as SFG’s subsidiary
2005.11.24		Resolution to liquidate e-Shinhan is passed at the general shareholders’ meeting
2005.12.13		Acquired Shinhan Life Insurance Co., Ltd. as wholly-owned subsidiary through stock swap
2006.4.1		The integrated Shinhan Bank and Shinhan Card was launched
2006.8.16		Designated as the preferred bidder for the proposed acquisition of shares of LG Card Co., Ltd. (“LG Card”)
2006.12.20		Executed LG Card Co., Ltd. Acquisition Agreement to acquire shares of LG Card
2007.2.23		Obtained FSC’s approval of inclusion of LG Card as subsidiary
2007.3.23		First round tender offer of LG Card shares, LG Card joins Shinhan Financial Group as subsidiary

(2) Change in Company Name: N/A

(3) Merger, Division (Merger Through Division), All-inclusive Stock Swap or Transfer, Acquisition or Transfer of Material Business, Etc.

Date		Details		Quantity				Remarks
Sep. 1, 2001		Stock transfer			292,344,192			Shinhan Bank, Shinhan Securities, Shinhan Investment Trust Management and Shinhan Capital established SFG through all-inclusive stock transfer
Jun. 6, 2002 Oct. 1, 2002 Dec. 31, 2002 Oct. 1, 2003 Dec. 31, 2003		Small-scale stock swap Small-scale stock swap Small-scale stock swap Small-scale stock swap Small-scale stock swap			15,891 786 256 11,626 164,484			Stock swap between SFG common shares and Shinhan Bank common shares issued upon conversion of bonds with warrant
Jun. 22, 2004		Small-scale stock swap			14,682,590			Small-scale stock swap to acquire Chohung Bank as the SFG’s wholly-owned subsidiary
Dec. 23, 2004		Small-scale stock swap			10,235,121			Small-scale stock swap to acquire Good Morning Shinhan Securities as the SFG’s wholly-owned subsidiary
Dec. 13, 2005		Small-scale stock swap			17,528,000			Small-scale stock swap to acquire Shinhan Life Insurance as the SFG’s wholly-owned subsidiary

Note 1)		By board resolutions dated December 30, 2005 of Shinhan Bank, Chohung Bank and Shinhan Card, each a SFG’s wholly owned subsidiary, the credit card business division of Chohung Bank merged with Shinhan Card through spin-off as of April 1, 2006, and following the spin-off, Chohung Bank merged with Shinhan Bank.
Note 2)		As a result of the spin-off of the credit card business division of Chohung Bank, Chohung

		Bank’s capital, stockholders’ equity and the number of issued and outstanding shares were reduced by KRW 210 billion, KRW 170 billion and 49,008,463 shares, respectively, and the credit card division merged with Shinhan Card at a merger swap ratio of 1:0.980941772 (one share of Chohung Bank for 0.980941772 common share of Shinhan Card). The name of the corporation surviving after the merger through spin-off was Shinhan Card.
Note 3)		Following the spin-off of the credit card business division of Chohung Bank, Shinhan Bank merged with Chohung Bank at a merger swap ratio of 1: 3.867799182 (one share of Shinhan Bank for 3.867799182 common share of Chohung Bank). The merger agreement was approved at the extraordinary general meeting of shareholders of each bank, and it was decided that the bank surviving after the merger would be Chohung Bank and that the name of the integrated bank would be Shinhan Bank.
Note 4)		The Company decided by a BOD resolution on May 28, 2007 to effect an all-inclusive stock swap to incorporate LG Card, an existing partial subsidiary, as its wholly-owned subsidiary. The major terms of the proposed stock swap are as follows:
		•    stock swap ratio: 0.84932
		* 0.84932 registered common share of SFG for each registered common share of LG Card
		•    Date of stock swap: September 21, 2007
		•    For more information on the proposed stock swap, please see the Stock Swap/Transfer Report submitted by SFG and LG Card on May 28, 2007.
Note 5)		Each LG Card and Shinhan Card, both subsidiaries of the Company, decided by BOD resolutions on May 28, 2007 to implement the transfer of all businesses of Shinhan Card to LG Card. The major terms of the proposed business transfer are as follows:
		•    Outline of business transfer
		The buyer, LG Card, plans to acquire all assets (including trademarks and other intellectual property, good will and trade name, etc.) and assume all liabilities of the seller, Shinhan Card, as well as all agreements (and all rights and obligations thereunder) entered into by the seller, Shinhan Card.
		•    The proposed business transfer is expected to be finalized upon approval of the shareholders of both parties at respective extraordinary shareholders meetings scheduled for August 13, 2007 and to take place on October 1, 2007.
		•    For more information on the proposed business transfer, please see the Business Transfer Report submitted by LG Card on May 28, 2007.

(4) Change in Manufacturing Facilities: N/A

(5) Material Events Related to Management: N/A

3. Business Purpose and Details of Business

(1) Business Purpose

		Business Objectives		Remarks
A.		Control or business management of a company that engages in financial business or in activities closely related to financial business;
B.		Financial support to subsidiaries, etc. (including any subsidiaries, indirect subsidiaries and companies controlled by indirect subsidiaries; the same shall apply hereafter) (“Subsidiaries, etc.”);
C.		Investment in subsidiaries or financing for financial support to Subsidiaries, etc.;
D.		Support for joint product development and sales to, and joint utilization of equipment, IT systems, etc. with, Subsidiaries, etc.; and
E.		Business activities incidental or related to the foregoing.

(2) Details of Business

Tender Offeror was incorporated in 2001 as a 100% privately-owned financial holding company in order to actively respond to trends of consolidation and diversification in the financial environment.

Since its incorporation, Tender Offeror strategically aimed at establishing the business structure of a total financial group, and developed systematic strategies, focusing on four key tasks: (i) improvement of the holding companies system; (ii) specific negotiations of strategic alliance; (iii) implementation of strategies to expand initial synergies; and (iv) enhancement of internal and external communications. First, Tender Offeror achieved management transparency by improving the governance and management system of the group and established an enhanced holding companies system as well as a system of mutual cooperation and support among group members by organizing various councils for each business division such as retail, corporate banking and asset management business, in an effort to build a foundation for one-portal, one-stop total financial services.

Tender Offeror incorporated a bank, a securities company, a credit card company, an investment trust management company, a capital company and an insurance company as its subsidiaries, thereby establishing a system that enables it to provide services in all financial areas as a total financial group. It is now promoting cross-selling among subsidiaries of products such as funds and FNA securities savings deposits, and focusing on development of complex products linked with insurance and credit card. Moreover, it engages itself in database marketing activities at the group level using an integrated group database.

Following the proposed stock acquisition through which LG Card will become one of its subsidiary, Tender Offeror will substantially enhance its presence in non-banking sectors by expanding its business areas and target markets based on an increased customer base and channels, and will increase the competency of the entire group in order to secure its leading position in the domestic financial market.

Finally, Tender Offeror will, in good faith, build a management system in compliance with world class standards and secure world class competency as a foundation for long-term survival and growth in the global competitive financial environment.

4. Capital and Total Number of Issued Shares (as of the Filing Date)

[Unit: KRW, shares; Par value per share: KRW 5,000]

								Total Amount of Par
Type		Class		No. of Issued Shares				Value				Capital
Registered		Common stock			381,567,614				1,907,838,070,000				1,907,838,070,000
Registered		Redeemable Preferred Stock			68,757,169				343,785,845,000				407,869,805,000
Registered		Convertible Redeemable Preferred Stock			14,721,000				73,605,000,000				73,605,000,000
		Total			465,045,783				2,325,228,915,000				2,389,312,875,000

Note 1)		The difference between the total amount of par value and the capital of redeemable preferred stocks issued by SFG can be explained by the fact that the capital cannot be decreased under the current Korean Commercial Code, even though the number of issued preferred stocks was reduced due to redemption of Series 1 preferred stocks (9,316,792 shares) and Series 6 preferred stocks (3,500,000 shares) that matured on August 21, 2006. For this reason, there is a difference (amounting to KRW 64,083,960,000) between the capital and the total amount of par value of issued and outstanding shares.

Note 2)		SFG resolved at the board meeting on December 18, 2006 to increase the capital for the purpose of financing the acquisition of LG Card shares and completed the capital increase (via issuance of redeemable preferred stocks and convertible redeemable preferred stocks) on January 25, 2007 as follows:

[Unit: KRW, shares; Par Value per share: KRW 5,000]

						Series 11
						Convertible
		Series 10 Redeemable				Redeemable
Classification		Preferred Stock				Preferred Stock				Total
Issue Price Per Share			100,000				57,806				—
No. of Shares Issued			28,990,000				14,721,000				43,711,000
Total Issue Price			2,899,000,000,000				850,962,126,000				3,749,962,126,000
Capital			144,950,000,000				73,605,000,000				218,555,000,000
Capital Surplus			2,754,050,000,000				777,357,126,000				3,531,407,126,000

Note 3)		The Company resolved at the BOD meeting on May 28, 2007 to redeem certain Class 2 redeemable preferred stocks as follows:
		•    Redeemed stocks: 9,316,792 shares of Class 2 redeemable preferred stock (issued on August 19, 2003)
		•    Total amount of redemption: 172,811,836,286 Korean Won (18,548.427 Korean Won per share)
		•    (Expected) Date of redemption: 20 August 2007 (Monday)
		•    If the redemption is completed during the month of August, 2007 as expected, the total number of issued and outstanding shares of the Company will be reduced by the number of redeemed shares, but the amount of capital will not be reduced because the redemption will be done using distributable income.
Note 4)		The Company decided by a BOD resolution on May 28, 2007 to effect an all-inclusive stock swap to incorporate LG Card, an existing partial subsidiary, as its wholly-owned subsidiary.
		The major terms of the proposed stock swap are as follows:
		•    stock exchange ratio: 0.84932
		* 0.84932 registered common share of SFG for each registered common share of LG Card
		•    Date of stock swap: September 21, 2007
		•    The number of issued and outstanding shares and capita amount will change after the stock swap on September 21, 2007.
		•    For more information on the proposed stock swap, please see the Stock Swap/Transfer Report submitted by SFG and LG Card on May 28, 2007.

5. Largest Shareholder (including Specially-Related Persons)

[As of March 31, 2007]

Name								Shareholding
(Company Name)		Relation		Shares Owned				Ratio (%)
BNP Paribas S.A.		Largest Shareholder			20,124,272				5.27
BNP Paribas Luxembourg		Largest Shareholder’s Subsidiary			13,557,832				3.55
BNP Paribas Arbitrage SNC		Largest Shareholder’s Subsidiary			900,628				0.24
Total		—			34,582,732				9.06

Note		Since holders of SFG preferred stock have no voting rights, the shareholding ratio is calculated based on the number of common shares.

6. Officers and Their Shareholding

[As of May 31, 2007]

Shares Owned

Date of

Common

Preferred

Initial

Position

Name

Date of Birth

Background/Prior Affiliation

Stock

Stock

Appointment

Chairman (standing)

Eung Chan Ra

Nov. 25, 1938

•

Seonlin Commercial High School Graduate

•

President & Rep. Director, Shinhan Bank

•

Vice Chairman, Shinhan Bank

133,103

—

Sept. 1, 2001

President & CEO (standing)

In Ho Lee

Nov. 2, 1943

•

BA in Economics, Yonsei University

•

EVP, Shinhan Bank

•

President & Rep. Director, Shinhan Bank

23,191

—

Sept. 1, 2001

Director

Sang Hoon Shin

Jul. 1, 1948

•

MBA, Yonsei University

•

President, Shinhan Bank (current)

109,694

—

Mar. 20, 2007

Outside Director

Pyung Joo Kim

Feb. 6, 1939

•

PhD., Economics, Princeton University

—

—

Mar. 20, 2007

•

Professor, Sogang University

Outside Director

Young Woo Kim

May 1, 1952

•

BA in Political Economy, Waseda University

—

—

Mar. 20, 2007

•

CEO, Hanil Electronics (current)

Outside Director

Sang Yoon Lee

Sept. 13, 1942

•

BA in Commerce, Seoul National University

—

—

Mar. 25, 2004

•

Non-statutory Vice-Chairman, Korea Food Industry Association (current)

•

Representative Director and President, Nongshim Ltd. (current)

Outside Director

Yoon Soo Yoon

Mar. 5, 1946

•

BA in Political Science & Diplomacy, Korea University of Foreign Studies

—

—

Mar. 25, 2004

•

Non-Executive Director of Hanvit Bank

•

President of Fila Korea Ltd. (current)

Outside Director

Shee Yul Ryoo

Sept. 5, 1938

•

LLB, Seoul National University

—

—

Mar. 30, 2005

•

President, Korea First Bank (former)

•

Chairman, The Korea Federation of Banks (former)

•

Advisor, Shin & Kim (current)

Outside Director

Byung Hun Park

Sept. 10, 1928

•

BA in Law, Politics and Economics at Meiji University, Japan

28,659

—

Sep. 1, 2001

•

President, HQ of Korean Residents’ Union in Japan

•

Chairman, Daeseong Electronics Ltd (current)

Outside Director

Young Hoon Choi

Nov. 8, 1928

•

LLB in Law, Ritsumeikan University, Japan

135,400

—

Mar. 30, 2005

•

Non Executive Director, Shinhan Bank

•

Chairman, Eishin Group (current)

Outside Director

Si Jong Kim

Apr. 16, 1937

•

Sigaken Yashu High School

8,764

—

Mar. 30, 2005

•

Director, Yokohama Shogin

•

Director, Korea Chamber of Office in Kanagawa, Japan

•

Standing Advisor, Kanagawa Division, Korean Residents’ Union in Japan (current)

Position

Name

Date of Birth

Background/Prior Affiliation

Shares Owned

Date of

Common

Preferred

Initial

Stock

Stock

Appointment

Outside Director

Philippe Reynieix

Jun. 24, 1949

•

Master of Business Law, Paris II University, France

—

—

Mar. 25, 2004

•

Chief Operating Officer BNP Paribas, Singapore

•

Rep. Director & GM for Korea BNP Paribas, Seoul (current)

Outside Director

Haeng Nam Chung

Mar. 15, 1941

•

Tomishima Jr. High School

30,000

—

Mar. 21, 2006

•

Director, Asuka Credit Union

•

Advisor, Korean Chamber of Commerce and Industry (current)

Outside Director

Yong Woong Yang

Aug. 4, 1948

•

BA, Chosun University, Japan

96,586

—

Mar. 25, 2004

•

President, Doen, Japan (current)

Outside Director

Sung Bin Chun

Jan. 21, 1953

•

PhD., Business Administration, Berkeley University

—

—

Mar. 20, 2007

•

Professor, Sogang University

Deputy President

Jae Woo Lee

Jul. 2, 1950

•

Graduated from Kunsan Commercial High School

14,382

—

Dec. 16, 2004

•

MBA, Korea University

•

Deputy President, Shinhan Bank

Deputy President

Jae Woon Yoon

Jul. 22, 1951

•

BA in Education, Seoul National University

—

—

Aug. 26, 2005

•

General Manager of Trust Business Dept., Chohung Bank

•

Director of Central Region HQ, Chohung Bank

Deputy President

Buhmsoo Choi

August 8, 1956

•

BA in Economics, Seoul National University

—

—

May 28, 2007

•

PhD., Economics, Yale University

•

Vice President, Kookmin Bank

Total

579,779

—

7. Specially-Related Persons

[As of March 31, 2007]

Occupation

Name

Relation with

Capital (million

(Details of

(Company Name)

Tender Offeror

Address

Won)

Largest Shareholder

Business)

Shinhan Bank

Subsidiary

120 Taepyungro 2-ga, Jung-gu, Seoul

7,528,078

SFG

Banking business

LG Card

Subsidiary

6-1 Namdaemun-ro 5ga Jung-gu Seoul

626,847

SFG

Credit card business

Good Morning Shinhan Securities

Subsidiary

23-2 Yoido-dong, Yeongdeungpo-gu, Seoul

796,998

SFG

Securities business

Shinhan Card

Subsidiary

14 Namdaemoonro 1-ga, Jung-gu, Seoul

358,886

SFG

Credit card business

Shinhan Capital

Subsidiary

530-1 Gozan-dong, Danwon-gu, Ansan, Kyeonggi-do

80,000

SFG

Credit extension business

Jeju Bank

Subsidiary

1349 Yi-do, Yido 1-dong, Jeju City

77,644

SFG

Banking business

Shinhan Life Insurance

Subsidiary

120 Taepyungro 2-ga, Jung-gu, Seoul

200,000

SFG

Life insurance business

Occupation

Name

Relation with

Capital (million

(Details of

(Company Name)

Tender Offeror

Address

Won)

Largest Shareholder

Business)

Shinhan-BNP Paribas Investment Trust Management Co.

Subsidiary

18th Fl., Good Morning Shinhan Tower, 23-2 Yoido-dong, Yeongdeungpo-gu, Seoul

40,000

SFG

Securities investment trust business

Shinhan Macquarie Financial Advisory

Subsidiary

9th Fl., Hanwha Bldg., Sogong-dong, Jung-gu, Seoul

1,000

SFG

Financial advisory business

Shinhan Credit Information

Subsidiary

32 Moonraedong 3-ga, Yeongdeungpo-gu, Seoul

3,000

SFG

Credit survey business

SH&C Life Insurance

Subsidiary

3rd Fl., Seoul City Tower, Namdaemoonro 5-ga, Jung-gu, Seoul

30,000

SFG

Insurance business

Shinhan Private Equity

Subsidiary

14th Fl., Heungkuk Life Bldg., Shinmunro 1-ga, Jongro-gu, Seoul

10,000

SFG

Private equity operations business

Shinhan Data System

Indirect subsidiary

17th Fl., Daekyung Bldg., 120 Taepyungro 2-ga, Jung-gu, Seoul

1,000

Shinhan Bank

Software development business

Shinhan Finance Ltd.

Indirect subsidiary

Room 3401, Gloucester Tower, The Land mark, 11 Pedder St., Central, Hong Kong

63,684

Shinhan Bank

Banking business

SH Asset Management

Indirect subsidiary

7th Fl., Good Morning Shinhan Tower, 23-2 Yoido-dong, Yeongdeungpo-gu, Seoul

45,000

Shinhan Bank

Investment trust business

Shinhan Asia Ltd.

Indirect subsidiary

Suites 3507-3508, 35/F, Two Exchange Square, 8 Connaught Place, Central, HK

13,944

Shinhan Bank

Banking business

Shinhan Bank America

Indirect subsidiary

330 5th Avenue 4th Floor New York, NY 10001 USA

13,014

Shinhan Bank

Banking business

Shinhan Bank Europe

Indirect subsidiary

Neue Mainzer Strasse 75 60311 Frankfurt am Main, Germany

18,748

Shinhan Bank

Banking business

Shinhan Vina Bank

Indirect subsidiary

3-5 Ho Tung Mau Street, District 1, HCMC, Vietnam

18,592

Shinhan Bank

Banking business

CHB Valuemeet 2001 First SPC

Indirect subsidiary

10th Fl., Lawyer’s Bldg., Dangju-dong, Jongro-gu, Seoul

10

Shinhan Bank

Other financial business

CHB Valuemeet 2001 Second SPC

Indirect subsidiary

10th Fl., Lawyer’s Bldg., Dangju-dong, Jongro-gu, Seoul

10

Shinhan Bank

Other financial business

CHB Valuemeet 2002 First SPC

Indirect subsidiary

10th Fl., Lawyer’s Bldg., Dangju-dong, Jongro-gu, Seoul

10

Shinhan Bank

Other financial business

Occupation

Name

Relation with

Capital (million

(Details of

(Company Name)

Tender Offeror

Address

Won)

Largest Shareholder

Business)

Good Morning Shinhan Securities Europe Ltd.

Indirect subsidiary

7th Floor, 52 Cornhill, London EC3V 3PD, United Kingdom

6,202

Good Morning Shinhan Securities

Securities brokerage business

Good Morning Shinhan Securities USA Inc.

Indirect subsidiary

1325 6th Ave. #702, NY, NY 10019 USA

3,904

Good Morning Shinhan Securities

Securities brokerage business

Shinhan NPS Private Equity Fund 1st

Indirect subsidiary

226 Shinmunro 1-ga Jongro-gu, Seoul

138,000

National Pension Fund

Other financial business

Note 1)

Tender Offeror’s specially related persons that are companies (corporations) are as listed above.

	•		Among Tender Offeror’s specially related persons, only Shinhan Bank Co., Ltd. owns LG Card shares. The number of LG Card shares owned by Shinhan Bank is 8,960,005.
	•		Information on officers of either Tender Offeror or its affiliates is omitted pursuant to Article 10-3 (3) of the Enforcement Decree of the Securities and Exchange Act because they own less than 1,000 shares of LG Card.

Note 2)

Although the largest shareholder of Shinhan NPS Private Equity Fund 1st is National Pension Fund, since Shinhan Private Equity, a subsidiary of Tender Offeror, is a general partner of the Fund, it is a indirect subsidiary of Tender Offeror.

B. Information on Corporate Group of Which Tender Offeror Is a Member

1. Name of Corporate Group

Shinhan Financial Group Co., Ltd.

2. Companies Belonging to the Corporate Group

Classification		No. of Companies				Company Name
Listed Corporation		1 (holding company)				Shinhan Financial Group
		2 (subsidiaries)				Jeju Bank, LG Card
Non-listed Corporations		10 (subsidiaries)				Shinhan Bank, Good Morning Shinhan Securities, Shinhan Card, Shinhan Capital, Shinhan Life Insurance, Shinhan-BNP Paribas Investment Trust Management Co., Shinhan Macquarie Financial Advisory, Shinhan Credit Information, SH&C Life Insurance, and Shinhan Private Equity
		13 (indirect subsidiaries)				Shinhan Data System, Shinhan Finance Ltd., SH Asset Management, Shinhan Asia Ltd., Shinhan Bank America, Shinhan Bank Europe, Shinhan Vina Bank, CHB Valuemeet 2001 First SPC, CHB Valuemeet 2001 Second SPC, CHB Valuemeet 2002 First SPC, Good Morning Shinhan Securities Europe Ltd., Good Morning Shinhan Securities USA Inc., Shinhan NPS Private Equity Fund 1st
Total			26			—

Note 1)      LG Card joined Shinhan Financial Group as a subsidiary on March 23, 2007

3. Relevant Law and Regulation

	(i)		Since Shinhan Financial Group is composed of subsidiaries and indirect subsidiaries of SFG and SFG is a financial holding company under the Financial Holding Companies Act (“FHCA”), Shinhan Financial Group is subject to any and all regulations under the FHCA.
	(ii)		Major regulations under the FHCA applicable to a financial holding company such as Shinhan Financial Group include (i) certain limits on investment under which a financial holding company can invest in subsidiaries only to the extent of its stockholders’ equity, and (ii) prohibition against running other profit-making businesses than managing its subsidiaries and other businesses incidental thereto.
	(iii)		Furthermore, the FHCA prohibits subsidiaries and indirect subsidiaries from making investment in, or extending credits to, a parent financial holding company, and restricts them from holding stocks of, or extending credits to, other subsidiaries or indirect subsidiaries.
	(iv)		For details of regulations under the FHCA, please refer to the FHCA, the Enforcement Decree thereof, and the Regulation on Supervision.
	(v)		In addition to the FHCA, Tender Offeror is subject to regulations under the Monopoly Regulation and Fair Trade Act, the Securities and Exchange Act (“SEA”), and other relevant laws and regulations.

4. Summary Consolidated Financial Statements

(1) Consolidated Balance Sheet

[Unit: KRW million]

		6th Fiscal Year				5th Fiscal Year
Category		(As of Dec. 31, 2006)				(As of Dec. 31, 2005)
[Assets]
Cash & Bank Deposits			11,273,500				8,429,328
Trading Securities			5,516,622				5,495,510
Available-for-Sale Securities			17,978,765				21,612,238
Held-to-Maturity Securities			7,558,816				2,996,243
Equity Securities by the Equity Method			230,199				120,392
Loans			122,301,730				106,648,448
Fixed Assets			3,683,848				3,486,803
Other Assets			9,181,689				11,428,939
Total Assets			177,725,169				160,217,901
[Liabilities]
Deposits			99,759,523				91,538,441

		6th Fiscal Year				5thFiscal Year
Category		(As of Dec. 31, 2006)				(As of Dec. 31, 2005)
Borrowings			16,892,153				15,916,389
Debentures			29,484,758				22,840,156
Other Liabilities			20,076,630				19,712,042
Total Liabilities			166,213,064				150,007,028
[Capital Stock]			2,170,758				2,170,758
[Consolidated Capital Surplus]			4,411,506				4,393,846
[Consolidated Retained Earnings]			3,387,960				2,743,192
[Capital Adjustment]			1,391,302				829,221
[Minority Interest]			150,579				73,856
Total Stockholders’ Equity			11,512,105				10,210,873

(2) Consolidated Income Statement

[Unit: KRW million]

		6th Fiscal Year				5th Fiscal Year
Category		(Jan. 1, 2006 ~ Dec. 31, 2006)				(Jan. 1, 2005 ~Dec. 31, 2005)
Operating Revenues			19,812,440				15,466,345
Operating Expenses			17,782,332				13,707,080
Operating Income			2,030,108				1,759,265
Ordinary Income			2,513,677				1,824,650
Net Income			1,842,513				1,567,240
Consolidated Period Income			1,832,718				1,560,760
No. of companies included		18 companies				21 companies
in the consolidated income		SFG / (8) subsidiaries / (7)				SFG / (9) subsidiaries / (8)
statement		indirect subsidiaries / (2) trusts				indirect subsidiaries / (3) trusts

C. Financial Information of Tender Offeror

1. Balance Sheet

The 1^st Quarter of the 7^th Fiscal Year (As of Mar. 31, 2007)
The 6^th Fiscal Year (As of Dec. 31, 2006)
The 5^th Fiscal Year (As of Dec. 31, 2005)

[Unit: KRW million]

		7th Fiscal
		Year,								5th
Category		1st Quarter				6th Fiscal Year				Fiscal Year
Assets
I.Cash & Bank Deposits			460,416				468,561				64,374
1.Bank Deposits			460,410				468,555				64,374
2.Due from banks			6				6				0
II. Securities			20,014,778				12,775,892				10,882,359
(1) Equity Securities Accounted for by the Equity Method			20,014,778				12,775,892				10,882,359
III. Loans			1,100,292				1,179,147				1,476,630
(Allowance for Possible Loan Losses)			-5,529				-5,925				-7,420

		7th Fiscal
		Year,								5th
Category		1st Quarter				6th Fiscal Year				Fiscal Year
1. Loans in Korean Won			1,040,000				1,120,000				1,340,000
2. Loans in Foreign Currency			65,821				65,072				70,910
3. Privately Placed Bonds			0				0				73,140
IV. Premises and Equipment			693				776				1,200
1. Vehicles			261				261				391
Accumulated Depreciation			-195				-187				-225
2. Equipment			1,419				1,416				1,391
Accumulated Depreciation			-1,118				-1,081				-991
3. Others			1,733				1,728				1,704
Accumulated Depreciation			-1,407				-1,361				-1,070
V. Other Assets			83,587				579,255				37,568
1. Guarantee Deposits			9,915				9,915				10,082
2. Software			835				910				1,090
3. Accounts Receivable			45,778				37,907				14,809
4. Accrued Income			7,732				8,016				8,466
5. Advance Payments			610				519,328				10
6. Prepaid Expenses			12,899				1,023				724
7. Prepaid Income Taxes			3,997				346				577
8. Sundry Assets			1,821				1,810				1,810
Total Assets			21,659,766				15,003,631				12,462,131
Liabilities
I. Borrowings			5,807,325				3,606,898				2,282,141
1. Borrowings in Korean Won			653,000				120,000				85,188
2. Borrowings in Foreign Currency			65,821				65,072				70,910
3. Debentures in Korean Won			5,100,000				3,430,000				2,130,000
Discounts			-11,496				-8,174				-3,957
III. Other Liabilities			421,405				35,207				42,973
1. Withheld Taxes			10,379				561				491
2. Dividends Payable			352,681				1,619				1,284
3. Accounts Payable			23,682				329				20,990
4. Accrued Expenses			33,586				31,915				19,656
5. Income Taxes Payable			0				0				0
6. Unearned Revenues			0				0				0
7. Accrued Severance Benefits			2,127				2,015				1,379
Deposits with Insurance Company for Severance Benefits			-1,050				-1,232				-827

		7th Fiscal
		Year,								5th
Category		1st Quarter				6th Fiscal Year				Fiscal Year
Total Liabilities			6,228,730				3,642,105				2,325,114
Stockholders’ Equity
I. Capital Stock			2,389,313				2,170,758				2,170,758
1. Common Stock			1,907,838				1,907,838				1,796,037
2. Preferred Stock			481,475				262,920				374,721
II. Capital Surplus			7,877,765				4,360,082				4,360,112
1. Paid-in Capital in Excess of Par Value			7,877,644				4,359,961				4,359,991
2. Other Capital Surplus			121				121				121
III. Capital Adjustment			53,853				44,491				17,163
1. Stock Options			53,853				44,491				17,163
IV. Accumulated other Comprehensive Income			1,153,698				1,398,235				845,792
1. Unrealized gain on equity securities by the equity method			1,159,072				1,403,453				850,368
2. Unrealized loss on equity securities by the equity method			-5,374				-5,218				-4,576
V. Retained earnings			3,956,407				3,387,960				2,743,192
1. Legal reserve			580,200				396,928				223,722
2. Other reserve			172,812				—				—
3. Unappropriated retained earnings			3,203,395				2,991,032				2,519,470
(Net Income:
1st quarter of 7th fiscal year: KRW 959,844 million
6th fiscal year: KRW 1,832,718 million
5th fiscal year: KRW 1,560,760 million)
Total Stockholders’ Equity			15,431,036				11,361,526				10,137,017
Total Liabilities and Stockholders’ Equity			21,659,766				15,003,631				12,462,131

2. Income Statement

The 1^st Quarter of the 7^th Fiscal Year (Jan. 1, 2007 - Mar. 31, 2007)
The 6^th Fiscal Year (Jan. 1, 2006 - Dec. 31, 2006)
The 5^th Fiscal Year (Jan. 1, 2005 - Dec. 31, 2005)

[Unit: KRW million]

		7th
		Fiscal Year,
		1st				6th				5th
Category		Quarter				Fiscal Year				Fiscal Year
I. Operating Revenues			1,015,411				2,003,752				1,718,950
(1) Gain on Valuation Using the Equity Method			952,272				1,917,268				1,618,314
(2) Interest Income			61,994				79,151				95,812

		7th
		Fiscal Year,
		1st				6th				5th
Category		Quarter				Fiscal Year				Fiscal Year
1. Interest on Bank Deposits			46,197				6,918				1,646
2. Interest on Loans			15,797				70,057				88,637
3. Interest on Privately Placed Bonds			—				2,176				5,529
(3) Gain on foreign currency transaction			749				5,838				3,451
(4) Other Operating Revenue			396				1,495				1,373
1. Reversal of allowance for possible loan losses			396				1,495				1,373
II. Operating Expenses			78,229				182,889				158,321
(1) Loss on Valuation Using the Equity Method			—				—				1,047
(2) Interest Expenses			62,647				129,644				114,544
1. Interest on Borrowings			5,557				5,404				4,693
2. Interest on Debentures			57,090				124,167				109,307
3. Other Interest			—				73				544
(3) Loss on foreign currency transaction			749				5,838				3,449
(4) Commission Expenses			19				269				124
(5) Selling and Administrative Expenses			14,814				47,138				39,157
1. Salaries			9,590				29,133				22,813
2. Retirement Allowance			409				973				740
3. Employee Benefits			383				1,202				1,607
4. Rent			52				568				520
5. Entertainment			225				939				782
6. Depreciation			93				562				652
7. Amortization on Intangible Assets			76				295				115
8. Bad Debt			—				—				—
9. Taxes and Dues			81				2,453				2,209
10. Advertising			3				44				15
11. Commissions			3,175				8,484				6,034
12. Other			727				2,485				3,670
III. Operating Income			937,182				1,820,863				1,560,629
IV. Non-Operating Income			22,662				11,855				992
1. Miscellaneous			—				11,855				992
2. Income tax refunds			2,662				—				—
V. Non-Operating Expenses			—				—				861
1. Loss on Sale of Equity Securities Accounted for by the Equity Method			—				—				845
2. Contribution			—				—				16

		7th
		Fiscal Year,
		1st				6th				5th
Category		Quarter				Fiscal Year				Fiscal Year
VI. Continuing operations income before income tax			959,844				1,832,718				1,560,760
VII Income tax expense			—				—				—
VIII. Net Income for the Period			959,844				1,832,718				1,560,760
(Earning / Ordinary Income per Share: KRW)			(2,416 / 2,416	)			(4,776 / 4,776	)			(4,360/ 4,360	)
(Diluted Earning/ Ordinary Income per Share: KRW)			(2,353 / 2,353	)			(4,776 / 4,776	)			(4,109 / 4,109	)

3. Statement of Appropriation of Retained Earnings (or Statement of Disposition of Deficit)

The 6^th Fiscal Year (Jan. 1, 2006 - Dec. 31, 2006)
The 5^th Fiscal Year (Jan. 1, 2005 - Dec. 31, 2005)
The 4^th Fiscal Year (Jan. 1, 2004 - Dec. 31, 2004)

[Unit: KRW million]

		6th				5th				4th
Category		Fiscal Year				Fiscal Year				Fiscal Year
I.Retained Earnings before Appropriations			2,991,032				2,519,471				1,489,493
1. Unappropriated Retained Earnings Carried over from Prior Years			1,263,407				1,036,573				504,585
2. Change in Retained Earnings of Subsidiaries			-105,037				-77,863				-65,387
3 Cumulative Effect of Accounting Changes			-56				—				—
4.Net Income			1,832,718				1,560,760				1,050,295
II. Appropriations of Retained Earnings			748,323				1,256,063				452,920
1.Legal Reserve			183,272				173,207				105,030
2.Repayment of Preferred Stock (Note)			172,812				697,807				—
3.Dividends			392,239				385,049				347,890
A. Common Stock Cash Dividends			336,994				278,077				232,749
B. Preferred Stock Cash Dividends			55,245				106,972				115,141
III. Unappropriated Retained Earnings to Be Carried over Forward to Subsequent Year			2,242,709				1,263,407				1,036,573

II. The Issuer of the Shares Subject to the Tender Offer

A. Information Regarding the Issuer and Its Specially-Related Persons

1. Name

Issuer: LG Card Co., Ltd.
Korean Financial Supervisory Services (“FSS”) Registration Number: 00307897
Representative Director: Jong Ho LEE

2. History of the Issuer

(1) Incorporation and Changes after Incorporation

1987
November 20		Obtained credit card business license
1988
March 9		Changed name to “LG Credit Card Co., Ltd.”
April 1		Launched cash advance service
June 1		Merged with Goldstar Factoring Co., Ltd.
September 16		Signed partnership agreement with MasterCard International
1989
March 2		Began credit card loan business
April 4		Began international card and consumer financing business
June 1		Launched automatic electronic fund transfer service
November 10		Began payment guarantee business
1990
March 15		Began special-purpose loan business
1991
March 4		Launched 24-hour phone service for credit limit increase and lost/stolen card reporting
September 1		Launched “LG Green Card”
1992
April 22		Launched “Lady Card”, a credit card exclusively for women
December 15		Launched “Daehyun Fashion Club Card,” the first of its kind in Korea
1993
March 22		Launched “Artist Card”
1994
April 1		Launched “LG Caltex Oil-LG Card”
May 1		Introduced integrated credit limit management system
May 17		Introduced interactive voice response (IVR) system
1995
April 17		Launched “LG-Skypass Card” with Korean Air
1996
April 15		Signed international affiliation agreement with China Trust Commercial Bank of Taiwan and became the first Korean credit card to be accepted overseas
1997
January 3		Introduced the industry’s first RDB (relational database) system
April 1		Launched ARS cash advance service
May 6		Launched new review/issuance system
July 3		Signed partnership agreement with JCB Card of Japan
September 29		Signed partnership agreement with VISA Card of the U.S.
1998
January 1		Merged with LG Installment Finance
February 18		Began leasing business
October 1		Launched asset and liability management (ALM) system (comprehensive risk management system)
October 6		Introduced data warehousing system
1999
January 1		Changed name into LG Capital Services Corp.
May 12		Began beneficiary certificate-secured loan business
May 18		Registered its foreign exchange business
June 21		Launched Korea’s first B2B e-commerce system
July 17		Signed partnership agreement with GE Capital, U.S.

September 1		Launched “New LG Lady Card”, a credit card exclusively for women
September 15		Launched “LG2030 Card”, a credit card exclusively for men
November 1		Launched Web-based loan products
2000
February 16		Launched “LG Platinum Card” for VIPs
March 24		Registered its venture capital financing business
April 19		Launched “PAX Cargo Card,” Korea’s first marine cargo insurance card
June 28		Launched “Hello Kitty Card,” the industry’s first character credit card
June 29		Formed A-Cash e-currency consortium
July 21		Increased capital by KRW 350 billion
October 5		Formed strategic alliance with Asiana Airlines
November 1		Launched “LG e+Card,” a completely secure brand-new virtual card
2001
February 1		Launched “MyLGPoint” service, a new concept point award system
February 1		Launched “LG Pre I Card,” a pre-paid card for N-generation
March 14		Launched “New Corporate Card”
April 24		Launched “LG ALL JAPAN Card” for travelers to Japan
July 2		Entered the mobile commerce market in business partnership with SK Telecom
July 23		Launched “LG ACE Card” targeting middle to old age customers
September 1		Changed name into LG Card Co., Ltd.
November 20		Launched the industry’s first composite ABS that combines loan and lease bonds
November 21		Launched “LG Leports Card”
December 20		Launched global ATM service
2002
January 29		Launched “LG Cultural Card” for theatre and movie goers
February 18		Launched “MyPass Card,” a post-paid bus/subway pass card
April 1		Launched “LG Environment Card”
April 22		Listed on the Korean Stock Exchange
July 3		Launched “LG Card Travel” that provides total travel service
August 14		Launched “LG Plus Coupon” service
October 10		Entered the auto lease market
November 1		Launched credit card for duty-free shops
November 12		Signed MOU with KT Smart Card
November 28		Became the first Korean credit card company to issue a cross-border FRN
2003
January 28		Introduced B2B cost-saving purchasing system
February 13		Issued USD 300 million cross-boarder ABS
February 24		Entered into a partnership agreement with Korean Nurses Association
March 3		Launched on-/off-line LG e-coupon (integrated electronic coupon) services
April 1		Acquired ‘BS 7799’ certificate, an international information protection standard
May 1		Introduced fingerprint-recognition payment service
July 18		Launched travel-leisure “L-Club” service
July 21		Issued subordinated CB
August 12		Issued subordinated BW
October 1		Launched “Moneta-LG Card”
November 17		Launched “LG VISA Mini Card”
2004
January 15		Began to receive full-scale business normalization aid from KDB
January 16		Spun off from LG Group
February 12		Launched “KDB-LG Card” with KDB
February 13		Completed KRW 1 trillion Debt-Equity Swap
February 14		Established Labor union

March 15		Appointed H.C. Park as new Representative Director by shareholders’ resolution
March 24		Reorganized workforce into “Emergency Management System”
April 11		Launched real-time cash fraud transaction detection system
April 16		Nonghyup became largest shareholder (10.57%)
April 22		Signed MOU with four other financial institutions for the joint-establishment of Credit Bureau
April 29		Launched “LG T-Plus Card”
July 5		Main office relocated to Namdaemun, Seoul, Korea
July 20		Launched new card loan products (LG Free Loan, LG Discount Loan)
July 28		Completed 2nd Debt-Equity Swap
July 29		Largest shareholder changed from Nonghyup to KDB (26%)
October 28		Recorded KRW 17.6 billion in net profit; achieved monthly surplus
December 1		Organized annual “Give Hope Bazaar” to help the elderly
December 22		Signed an agreement with Merrill Lynch, U.S., to issue ABS (USD 400 million)
December 24		Launched “LG Digital Gift Certificate”
December 31		Creditors and LG Group agreed to increase capital
2005
January 28		Increased capital by KRW 1 trillion through public offering with consideration
February 1		Signed Korea’s first research grant card agreement with Sookmyung Women’s University
February 2		Started Year 2005 Business Innovation Movement: “Jump-V”
February 7		Launched “LG Caltex Oil Big Plus Smart Card”
February 14		Launched “Premium Revolving Service”
March 2		Launched “Thanksgiving Day” event
March 7		Decreased capital (5.5 : 1)
March 14		Raised new fund in 17 months using credit card bonds
March 16		Initiated social service such as designating Wednesdays of every second week of the month as the “Sharing and Volunteering Day”
March 23		Signed partnership agreement with Jeju City to launch a card exclusively for use in subsidy
March 28		Held the 4th LG Card Amateur Golf Competition
March 31		Launched LG Auto-Plus, a service allowing for one-stop new car purchase
April 15		Issued new 3-year term KRW 50 billion corporate bonds
April 15		Conducted social service jointly with the “Beautiful Fund”
May 12		Became the first Korean credit card company to branch out to overseas; launched “LG-JCB TRESARD”
May 29		Relocated Disaster Relief Center to Bupyeong, Gyeonggi-do, Korea
July 26		Signed a business cooperation agreement with the Republic of Korea National Red Cross
August 8		Issued USD 400 million cross-border ABS
August 25		Received ROK e-Finance Award (by Hankyung Newspaper)
August 29		KDB/Nonghyup/Woori Bank/IBK provided KRW 1 trillion credit line aid
September 14		Donated KRW 2.8 billion to aid the physically challenged
October 31		Became the industry’s first to sell mortgage loan
November 15		Launched new LG Family Card products
December 26		Upgraded “LG Lady Card” and “LG 2030 Card”
2006
January 13		Started “V-Up” management innovation program
January 18		Held Customer VIP Review meeting
January 19		Conducted community service; “Rice of Love”
January 24		Launched “Primus Supporters LG Card” for movie goers
January 25		Conducted nationwide volunteer service in 46 different volunteer centers

		in celebration of new years day
February 7		Launched “Home Plus Mobile LG Card”, Korea’s first contactless card
February 9		Held the 2005 annual business result presentation
February 20		Launched “LG Lady Card” triple sets
February 24		Launched the industry’s first “LG HiPass Plus Card” to pay expressway tolls
March 4		Set up sisterhood relationship with the village at Sambae-ri, Hwengsung-gun, Gangwon-do, Korea
March 5		Launched myLG Point Refill event
March 8		Held the 20th Ordinary Meeting of Shareholders
March 30		Donated KRW 370 million to the Ministry of Patriots and Veterans Affairs as LG Patriots and Veterans Funds
April 1		Launched “Card for 10 million people” commercial campaign
April 6		Sponsored overseas training of outstanding departments and individuals
April 7		Set up sisterhood relationship with Hayang village at Miryang, South Gyeongsang Province, Korea
April 11		Launched “DSME Labor Union LG Weeki Card”
April 13		Launched “LG Teddy Bear Card”
April 19		Launched pre-paid corporate card “LG Biz Cash Card”
April 20		Effective members exceeded 10 million
May 3		Delivered “Piggy Bank of Hope” to children in North Korea
May 4		Held signing ceremony for “Sawasdee Thailand-LG Card” partnership
May 29		Launched “I-Park-LG Card”
June 7		Opened “LG Card Campus”
June 9		Launched “The Best Card” for VIPs
June 12		Held the enterprise CS innovation workshop
July 27		Launched “LG Trabiz-Skypass Card”
August 3		Launched “Life Care Service”
August 8		Call Center Service Quality selected as No. 1 in the credit card sector by Korea Management Association
August 10		Signed partnership agreement with Yong-In City to launch a card exclusively for use in subsidy
September 6		Delivered KRW 3.4 billion to the Ministry of Health and Welfare as Fund for the Disabled
September 11		Launched “LG Home & Life Card”
September 22		Held the nationwide branch office head meeting
September 26		“LG Weeki Card” received the Best Design of MasterCard Asia/Pacific Marketing Leadership Award
September 28		Launched “Safe Card” to prevent credit card frauds/scams
September 29		Conducted social service event “Thanksgiving Love-songpyun Sharing”
2007
January 30		Launched Mirae Asset CMA Check Card
February 5		Launched CMA Check Card with Good Morning Shinhan Securities
February 23		Incorporation as a subsidiary of SFG approved by the FSC
March 23		LG Card’s largest shareholder is changed (Korea Development Bank ® Shinhan Financial Group), Shinhan Financial Group owns 85.7% of LG Card
March 26		LG Card’s Release from Receivership by Creditor Banks Appointment of directors at General Shareholders’ Meeting (Jong Ho Lee as CEO, 5 outside directors, and 3 audit committee members)

(2) Change of Corporate Name

Date		Name
March 9, 1988		LG Credit Card Co., Ltd.
January 1, 1999		LG Capital Services Corp.
September 1, 2001		LG Card Co., Ltd.

(3) Merger, Spin-off (Merger), All-inclusive Stock Swap or Transfer, Transfer of Material Business, etc.

a. Merged with LG Installment Finance Co., Ltd. on January 1, 1998

b. All-inclusive stock swap with SFG

Each LG Card and SFG decided by BOD resolutions on May 28, 2007 to effect an all-inclusive stock swap to incorporate LG Card, an existing partial subsidiary of SFG, as SFG’s wholly-owned subsidiary. The major terms of the proposed stock swap are as follows:

•

stock exchange ratio: 0.84932

*

0.84932 registered common share of SFG for each registered common share of LG Card

	•		Date of stock swap: September 21, 2007
	•		For more information on the proposed stock swap, please see the Stock Swap/Transfer Report submitted by SFG and LG Card on May 28, 2007.

c. Business Transfer from Shinhan Card

Each LG Card and Shinhan Card, both subsidiaries of the Company, decided by BOD resolutions on May 28, 2007 to implement the transfer of all businesses of Shinhan Card to LG Card. The major terms of the proposed business transfer are as follows:

•

Outline of business transfer

The buyer, LG Card, plans to acquire all assets (including trademarks and other intellectual property, good will and trade name, etc.) and assume all liabilities of the seller, Shinhan Card, as well as all agreements (and all rights and obligations thereunder) entered into by the seller, Shinhan Card.

•		The proposed business transfer is expected to be finalized upon approval of the shareholders of both parties at respective extraordinary shareholders meetings scheduled for August 13, 2007 and to take place on October 1, 2007.
•		For more information on the proposed business transfer, please see the Business Transfer Report submitted by LG Card on May 28, 2007.

(4) Change in Manufacturing Facilities: N/A

(5) Material Events Related to Management Activities

a. Incorporation of LG Card as SFG’s subsidiary

SFG entered into an agreement with KDB and other financial institutions on December 20, 2006 to acquire 78.6% equity interest in LG Card and, in accordance with the agreement, completed a tender offer on March 19, 2007, thereby incorporating LG Card as its subsidiary.

b. Preparation of the first “statement of changes in equity” in accordance with new accounting standards

SFG prepared its very first statement of changes in equity for the covered period by applying the new Financial Accounting Standards No. 21 (Preparation and Description of Financial Statements).

3. Business Purpose and Details of Business

(1)

Business Purpose

Business Objective				Remarks
(i)		Credit card issuance and management
(ii)		Credit card charge settlement
(iii)		Credit card franchise subscription and management
(iv)		Debit card and pre-paid card issuance
(v)		Pre-paid card sales (including refund services)
(vi)		Debit/pre-paid card charge settlement (including transaction approval service)
(vii)		Installment finance
(viii)		Facilities leasing
(ix)		Deferred payment services
(x)		Credit loan or secured loan
(xi)		Bill discount services
(xii)		Takeover, management, and collection of trade credits acquired by enterprises in exchange for providing goods and services
(xiii)		Purchase of credits held by another specialized credit finance business and/or combined credit business, or issuance of securities based on these purchased credits, in connection with businesses listed in subparagraphs (i) through (xii)
(xiv)		Payment guarantee
(xv)		Credit investigation and incidental business relating to the business listed in subparagraphs (i) through (xii)
(xvi)		Other business conducted for the purpose of credit extension
(xvii)		Venture capital financing
(xviii)		Equity financing and investment related to venture business
(xix)		Online and other e-business (including hub-portal site/shopping mall operation) and investment
(xx)		E-commerce-related business and investment
(xxi)		Mail order sale
(xxii)		Insurance agency business
(xxiii)		Travel service