April 20, 2024

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An aerial view of Mirae Asset Group‘s headquarters in Seoul. (Mirae Asset Group)

South Korean asset management firm Mirae Asset Global Investments said on June 7 its assets under management for retirement schemes have surpassed the 10 trillion-won ($9 billion) mark for the first time among Korean peers.

As of June 1, assets pooled for Mirae Asset’s retirement schemes came to a total of 10.1 trillion won.

The asset management unit of Mirae Asset Group pooled nearly 2 trillion won during the first five months of 2021. Since 2011, the figure has jumped more than eightfold from 1.2 trillion won.

Among the total assets under management for retirement schemes, latest available data showed that 4.2 trillion won went to individual retirement pension plans through which pension holders voluntarily accumulate retirement savings. The remaining 5.9 trillion won was pooled into employee pension plans, which Mirae Asset manages on behalf of corporate clients’ employees.

This comes as more Koreans are turning to private retirement plans other than the mandatory subscription to the National Pension Service, as Korea is considered one of the fastest-aging countries in the world. From January to May, Korean asset management firms have attracted a combined 4.5 trillion won for private retirement plans, with the accumulated assets under such plans reaching 36.9 trillion won as of June 1.

“Mirae Asset recognizes the consumer needs of retirement planning as (Korea) is increasingly bracing for an ageing population, so we are incorporating strategies of target-date funds or target-income funds into a wider range of financial products,” Ryu Kyeong-sik, head of the wealth management and pension marketing business unit at Mirae Asset, said in a statement.

Mirae Asset Global Investments is the second largest asset management firm in Korea with a total of over 150 trillion-won worth of assets. The company said in a statement that its independent portfolio diversification through overseas subsidiaries, as well as more exposure to alternative assets, have enabled the asset manager to meet the needs of pension holders.

Also, its target-date fund strategies for retirement plans of both individuals and employees have been gaining traction. TDF refers to an investment scheme where a portfolio’s asset allocation mix automatically rebalances throughout an account holder’s lifecycle to be less prone to volatility as the target date draws near.

Mirae Asset’s retirement plans adopting a TDF scheme had a 45 percent market share in the Korean market. Such plans attracted some 830 billion won from end-investors this year until May.

By Son Ji-hyoung (consnow@heraldcorp.com)