Woori Investment & Securities is one of several large Korean financial groups devoting considerable capital to developing a platform for alternative investments.
Hwang Sung-ho, CEO and president at Woori I&S, says the firm has a small hedge fund platform already in Singapore. The firm is deploying capital to create a multi-asset strategy from there.
Industry observers say Woori, Kookmin and Industrial Bank of Korea, as well as Samsung Securities, are among those financial groups that are devoting in excess of $1 billion each to such developments. Woori and Samsung are developing their platforms in Singapore, while Kookmin has a team in Hong Kong.
Hwang would neither confirm nor deny the figure for Woori, but says the sum is substantial. He clarifies, however, that most of the capital is going towards client-oriented services, as opposed to proprietary trading or principal investing.
The move reflects growing demand among Korean institutions for alternative exposures. Although Korean financial institutions want to develop such capabilities to compete internationally, they realise for now their target base will remain those domestic investors that lack the resources to seek global alternative investments by themselves.
Although these firms are keen to develop single strategies in hedge funds and private equity, for now the emphasis appears to be on funds of funds. Woori is also developing a hedge fund index, something transparent, liquid and relatively easy to manage.
Hwang joined Woori I&S as CEO and president earlier this summer, after having led PCA's (Prudential Asset Management UK) onshore business. He has also run CJ Securities (now rebranded as Hi Securities). At Woori, he replaced JS Park, who has retired.