[Person人] Choi Hee-nam, President of Korea Investment Corporation... Annual 23.4 Trillion KRW Profit 'Midas Touch'

"Achieving the Goal of the World's Top 10 Sovereign Wealth Funds"
Key Contributor to Hosting the G20 Summit
Renowned 'International Finance Expert'
Last Year's Investment Returns of 23.4 Trillion Won
Asset Size to Expand 2.5 Times by 2035

[Asia Economy Reporter Ji-hwan Park] There is a company that earned 23.4 trillion won in investment returns last year alone. This amount surpasses Samsung Electronics' net profit of 21.74 trillion won. This is the Korea Investment Corporation (KIC), which manages foreign currency funds entrusted by the Ministry of Economy and Finance and the Bank of Korea. Because it manages the nation's foreign exchange reserves on a delegated basis, it is also called a "sovereign wealth fund."

Established in 2005, KIC's initial assets under management were around 1 billion USD, but in just 15 years, it has grown to 157.3 billion USD (182 trillion won). Its cumulative investment returns have reached 49.2 billion USD (57 trillion won). It ranks 14th globally in asset size, following the Norwegian sovereign wealth fund, China Investment Corporation, Abu Dhabi Investment Authority, and others.

Originally aiming to be a Northeast Asian financial hub, KIC's goal has now been raised to become one of the world's top 10 sovereign wealth funds. At the center of this process is President Hee-nam Choi, who, through quiet leadership over two years and four months in office, has turned seemingly impossible goals into reality. President Choi graduated from Baemoon High School and Hanyang University with a degree in economics, then entered public service through the 29th Administrative Examination. From his time at the Ministry of Finance, he mainly handled international finance affairs. He later served as Director General for International Economic Affairs at the Ministry of Economy and Finance, Executive Director at the World Bank (WB), and Executive Director at the International Monetary Fund (IMF), becoming a well-rounded international finance expert with extensive experience and skills.

He has especially led major international finance-related tasks. During the foreign exchange crisis, he participated in IMF bailout negotiations, and in 2010, he was credited as a key figure in securing the G20 summit held in Seoul. After the G20 summit was confirmed, he served as the Director General for Agenda at the G20 Committee, focusing on discovering and advancing discussions on the "Global Financial Safety Net" as the chair country’s agenda. While he was a policy official in government, at KIC he is studying the actual market impact of policies.

In his inauguration speech, President Choi boldly declared, "I will grow KIC's assets under management to 200 billion USD and make it one of the world's top 10 sovereign wealth funds." Since taking office, he has focused on increasing asset size and returns, and his statements are becoming increasingly realistic. In his second year in office last year, he achieved a 15.39% return. Last year, KIC posted results of 182 trillion won in assets under management and 23.4 trillion won in investment returns. This was achieved amid numerous market uncertainties such as the intensifying US-China trade war and global economic slowdown.

However, this year, an unprecedented shock struck from the beginning. President Choi diagnoses that the global economic uncertainty has grown larger than ever due to the COVID-19 pandemic and the resulting corporate earnings slowdown. He believes that although we have entered an era where predictions are impossible, "there is always opportunity in crisis." By just looking around a little, there are clearly opportunities to revive the fading growth spark even amid great chaos.

One reason President Choi always keeps in mind the motto of Yi Won-ik, a Joseon Dynasty official known for his integrity, "Jihaeng sangbang bunbok habi (志行上方 分福下比)" is this. This phrase means "Always aim your will and conduct upwards, and always compare your innate status and blessings downwards." President Choi’s principle is to have high ideals but accept reality with cold-headedness and humility.

President Choi’s philosophy is also reflected in KIC’s organizational management. At a meeting with employees early this year, he quoted Winston Churchill’s saying, "A kite rises highest against the wind, not with it," and said, "The path ahead of us this year will likely require us to overcome fierce headwinds, but KIC’s strength will shine even more in moments of crisis," urging a different perspective on the crisis.

Recently, on the occasion of KIC’s 15th anniversary, he set new goals. Like the past lesson that "when Roman soldiers stopped running, the Roman Empire stopped," he judged that complacency with KIC’s past development and falling into managerial lethargy could cause the loss of the mission to continuously create national wealth. He plans to increase KIC’s asset size to 400 billion USD (480 trillion won) by 2035, which is 2.5 times the current level. To achieve this, President Choi presented three major strategies: enhancing long-term profitability, supporting the development of the domestic financial industry, and implementing responsible management. He has already established an asset allocation office dedicated to strategic asset allocation and strengthening investment capabilities by asset class such as equities and alternative investments. He will also focus on building a proactive risk management system to overcome domestic and international uncertainties. Collaboration to develop the domestic financial industry will also be expanded. The know-how and investment networks accumulated through overseas investments will be shared with other public funds.

Above all, President Choi believes that scale must be supported to succeed in investment. The larger the funds managed, the better the quality of investment opportunities and the lower the fee costs, allowing for two benefits at once. Along with additional mandates from existing entrusted institutions such as the Ministry of Economy and Finance and the Bank of Korea, efforts are underway to attract various pension funds and other new entrusted institutions.

To discover alternative investment opportunities, KIC plans to open an office on the US mainland in the third quarter of this year. They will establish an alternative investment forward base in the western North America region to participate in local venture companies and technology investments. This is aimed at forming networks with local pension funds, asset management companies, and others to secure high-quality investment opportunities early.

This content was produced with the assistance of AI translation services.