Samsung plans alternative-investment desk in Singapore

Samsung Securities is expanding into alternative investments in preparation for deregulation in Korean financial services next year, but overlaps with investment and insurance units have yet to be squared.
Samsung Securities is setting up a desk in Singapore to run a new alternative-investments strategy, according to Samsung Group insiders.

Park Chun-Hyeon, president and CEO of Samsung Securities, confirmed the existence of the desk but would not comment further.

Park was named CEO in June after serving as CFO at Samsung Life Insurance, and is expected to play a central role coordinating business activities among the groupÆs financial-services units once a new capital-markets law comes into force in February 2009.

The precise assignment for the Singapore desk has not been detailed, and may still be a work in progress internally. It could seed single managers, build its funds of funds, or establish its own strategies in hedge funds and unlisted opportunities. It is also likely to play a role in Samsung SecuritiesÆ new interest in prop trading and principal investments overseas.

These activities are being prepared in expectation of the implementation of the Capital Markets Consolidation Act in February 2009. This law is meant to dramatically overhaul securities regulation, so that financial service companies can create universal banks regulated by activity, rather than by license, under a unified agency. The Act is meant to recreate an environment similar to the principles-based regime in the United Kingdom or Australia, as well as to foster ænational championsÆ in financial services.

This will allow Samsung Securities to expand its ability to manage collective investment schemes as well as to run its own money.

Questions remain regarding overlap with Samsung Investments, which has its own ambitions in providing alternative investment products to third-party investors, or its relationship with the $104 billion Samsung Life or the smaller Samsung Fire & Marine insurers; Samsung Life is an active investor in many alternative strategies.

The September edition of AsianInvestor magazine features an in-depth look at Korean asset managersÆ regional ambitions.
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