South Korea's NPS looking to outsource investments to domestic fund managers

South Korea's NPS looking to outsource investments to domestic fund managers

The logo of the National Pension Service (NPS) is seen at its branch office in Seoul, South Korea, November 4, 2016. REUTERS/Kim Hong-Ji/File Photo

South Korea’s public pension fund said on Wednesday it would invest in locally-listed companies that are working to boost their value.

The National Pension Service (NPS), the world’s third-largest public pension fund, is in the process of selecting three domestic fund managers to outsource its investments and will finalise the decision by March, it said in a statement.

The NPS said the investment size and timing of the fund allocation were to be determined based on portfolio management and financial market conditions.

South Korea plans to announce on Feb. 26 a policy package dubbed “Corporate Value-up Programme”, including tax incentives, to boost the value of Seoul-listed companies by encouraging them to return more capital to shareholders and improve governance.

Analysts see the state-run pension fund, with its major stakes in large companies, playing a key role in South Korea’s efforts to boost their valuations over the medium to long term.

The NPS held 999.2 trillion won (US$748.64 billion) in financial assets as of the end of November. It held 141.1 trillion won in domestic stocks, 51 per cent of which were through outsourced investments.


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