Korea Post’s $60 billion savings bureau has invited domestic and overseas hedge fund managers, or institutions with a hedge fund offering, to pitch for three new mandates.
The bureau has issued requests for proposals (RFPs) for global macro, equity market neutral, and event driven portfolios. Single offshore hedge funds are being targeted, and the mandates exclude fund of hedge funds and structured products and notes.
The size of the mandates has not yet been decided, AsianInvestor understands.
Local and overseas hedge fund managers or financial institutions with a hedge fund offering can apply for the mandates. Each applicant can submit up to three strategies, but only one application will be considered for each strategy. If the same strategy is submitted by both a manager and a distributor, only the manager’s proposal will be considered. Global hedge funds already in the Korea Post Savings hedge fund investment pool are not eligible to apply.
Managers applying must have more than $1 billion in assets under management, while the AUM of the offshore fund they are putting forward must be more than $300 million. The firms must have at least three years’ fund management track record and have been established for at least three years.
As far as liquidity is concerned, the fund should provide at least daily and/or weekly, monthly, quarterly or semi-annual redemption and have less than a one-year hard lock-up or be quarterly redeemable with more than 25% of the invested capital for the investor-level gate. Managers should also provide weekly net asset value (NAV) estimates and official monthly NAVs.
The selection process is as follows: RFP submission by 5pm Korea time on August 19; first evaluation of candidates in August; the second evaluation involving a presentation and Q&A will take in September, which will decide candidates for on-site due diligence, and will lead to the third evaluation process. This last stage will involve implementation of on-site due diligence with the final selection to follow.
The required RFP documents include soft and Excel copies of the fund’s investment proposal with all the required data. The investment proposal must be in English and can include the manager's in-house marketing materials. It should profile the firm (AUM, organisation structure and staff etc), specific investment strategy, portfolio construction process (historical exposure by sub-strategies, asset types etc), risk management process and main contacts. The Excel file should include the fund's historical monthly returns (net of fees) since its inception through to the end of June 2015.
Korea Investment Management (KIM) is the bureau’s sole adviser on overseas alternative investments. For RFP submissions, please email both [email protected] and [email protected] Regarding all the RFP inquiries, e-mail [email protected], and all the inquiries must be made only via e-mail.
Korea Post has two financial service bureaus: postal savings and the postal insurance bureau, both under the management of the Ministry of Science, ICT & Future Planning. Postal savings manages around $60 billion and insurance $30 billion.
Last October, the savings bureau invited large offshore investment managers to pitch for a global tactical asset allocation (GTAA) mandate, as reported.