The advent of the AI finance era is transforming the role of financial companies. Traditionally, finance was limited to supplying funds after a company had grown. However, in the AI era, capital must be provided before industries such as semiconductors, data centers, robotics, energy, AI startups, and future manufacturing can thrive. The financial landscape is shifting from following industry trends to proactively selecting the future of industries.
Jeon Pil-hwan, CEO of Shinhan Capital, stands at the forefront of this change. Since taking office, he has focused on restructuring the company's real estate-centered portfolio and enhancing its investment banking capabilities. He is particularly committed to expanding financial support for national strategic industries such as AI, semiconductors, energy, and infrastructure, in line with Shinhan Financial Group's productive finance strategy.
Market observers view Jeon’s leadership not merely as a recovery of performance but as a transition to an 'investment finance system that supplies capital to the AI industry.'
The Future of Finance: From Lending to Investment
Jeon’s management philosophy diverges from traditional capital management. He prioritizes investment finance, which focuses on discovering future industries and supplying growth capital, over simply lending money and collecting interest. In recent years, Shinhan Capital has been restructuring its business model by reducing its reliance on real estate finance and expanding its corporate and investment finance capabilities.
Shinhan Financial Group plans to implement 110 trillion won in productive and inclusive finance over the next five years, contributing 10 trillion won to the National Growth Fund to support national strategic industries like AI, semiconductors, energy, and infrastructure. Jeon plays a pivotal role in executing this strategy.
Jeon has a clear vision for the future of finance. He believes the AI revolution is, in essence, an industrial revolution that requires capital. More important than financial companies utilizing AI is becoming the capital that nurtures the AI industry. Jeon aims to transform Shinhan Capital into an investment partner for national strategic industries rather than just a lending institution.
Innovation Begins with Asset Management
When discussing Jeon’s leadership, it is essential to highlight his focus on managing non-performing assets. From the outset of his tenure, he concentrated on real estate project financing and the resolution of distressed assets. The ratio of at-risk loans in real estate finance, which reached 27.8% in 2024, was reduced to 20.5% by the end of 2025, while the ratio of fixed non-performing loans also halved. He has resolved 350 billion won in bad debts and continued to pursue additional sales in 2026, increasing the proportion of projects in the metropolitan area to enhance the likelihood of recovering funds.
While many executives focus on growth, Jeon took a different approach by first eliminating risks. The rationale is straightforward: finance in the AI era ultimately revolves around data. No AI can function effectively on a foundation of distressed assets and distorted portfolios. His philosophy is that the starting point for financial innovation is soundness, not technology.
Proven Improvement Through Numbers
The results of Jeon’s strategies have been swift. In the first quarter of 2026, Shinhan Capital reported a net profit of 61.8 billion won, a 97.3% increase compared to the same period last year, surpassing half of last year’s total net profit. Non-interest income rose by 84.4%, while return on assets (ROA) increased from 1.03% to 2.02%, and return on equity (ROE) rose from 5.62% to 10.75%.
This success is not merely a result of favorable market conditions. It stems from restructuring the investment portfolio, reducing risky assets, and strengthening investment finance capabilities. Jeon demonstrates that a financial company’s competitiveness comes from the quality of its assets rather than its size.
Understanding AI Finance as an Industry Shift
Jeon views AI not just as a technology but as a catalyst for industrial change. Consequently, Shinhan Capital’s AI strategy focuses more on investment finance than on developing chatbots or platforms. His interests lie in areas such as AI data centers, AI semiconductors, cloud computing, robotics, and future manufacturing. This aligns with Shinhan Financial Group’s commitment to bolstering support for national strategic industries. In the AI era, the winners may not be the companies using AI but those that establish the AI industrial ecosystem first.
Recently, the government has also identified AI and semiconductors as key pillars of national growth strategy, expanding related financial support. Jeon believes that in this changing landscape, Shinhan Capital must evolve from being merely a capital provider to becoming a facilitator of industrial innovation.
Investment Banking Insights from Japan
Jeon’s competitive edge also stems from his global experience. During his tenure as head of Shinhan Bank's Japan subsidiary (SBJ), he established an investment banking desk and created an IB organization. This experience laid the groundwork for corporate and investment finance in the Japanese market and is reflected in his current management of Shinhan Capital. Industry experts anticipate that he will drive the expansion of Shinhan Capital's IB business.
This is not merely about diversifying revenue sources. In the AI era, the criteria for evaluating corporate value are changing. AI companies, data companies, and platform companies are now recognized as having higher value than traditional manufacturing firms. Jeon is among the first financial professionals to respond to this shift.
Proactive Funding Strategies Reflect AI Thinking
Another characteristic of Jeon’s management is proactivity. He anticipated the possibility of rising interest rates and implemented long-term funding and maturity diversification strategies. This approach secures funds when the market is favorable and enhances responsiveness during periods of volatility. Shinhan Capital successfully raised $300 million through a syndicated loan, maintaining its short-term borrowing ratio below 10% to manage liquidity effectively.
This strategy mirrors the thinking behind AI, which involves predicting the future and managing risks in advance. Jeon practices proactive management by reading the future of the financial market and responding accordingly.
The Essence of Financial Entrepreneurship
Jeon does not focus on flashy digital finance. Instead, he emphasizes industry and capital. He views AI not merely as a tool for improving efficiency in financial companies but as an industrial revolution that creates national growth drivers. Therefore, his interests lie more in AI data centers than in AI chatbots, and in AI semiconductor companies rather than mobile apps.
Financial entrepreneurship is about the ability to foresee the future. It involves supplying capital before industries grow rather than following them afterward. Jeon is transforming Shinhan Capital into such a company. In the AI finance era, Shinhan Capital envisions a future that transcends being merely the top capital provider; it aims to be an investment finance platform that nurtures South Korea's AI industry.
* This article has been translated by AI.
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