Hot Retirement Pension Market... 'Everyone Claims to Be Number 1'

Actively Promoting the Title of No.1 in 'Taking the Lead' for Profitability and Savings Growth Rate

[Asia Economy Reporter Ji-hwan Park] Mirae Asset Securities, No. 1 in DC and IRP retirement pension returns in the industry (April 22). Shin Young Securities, No. 1 in retirement pension returns for two consecutive quarters (April 20). Korea Investment & Securities, No. 1 in IRP fund growth rate among large operators (April 12). Hana Financial Investment, No. 1 in retirement pension fund growth rate in 2020 (March 15).

The securities industry is actively promoting their No. 1 titles to gain an edge in the rapidly emerging retirement pension market as a future growth engine.

Mirae Asset Securities announced on the 22nd that as of the end of the first quarter this year, it recorded a 13.75% return over the past year on defined contribution (DC) retirement pensions, the highest return among the top 10 operators by retirement pension funds. They also emphasized that the individual retirement pension (IRP) return was the highest at 11.37%. Shin Young Securities introduced that as of the end of the first quarter, their DC, defined benefit (DB) retirement pension, and IRP returns over the past year were the highest among all financial sector retirement pension operators. Shin Young Securities’ DB product one-year return was 8.45%, IRP was 27.39%, and DC was 23.18%.

Some securities firms emphasize being No. 1 in fund growth rate. Hana Financial Investment stated that their retirement pension funds under management increased by 39% compared to the previous year, achieving the highest growth rate among operators with over 100 billion KRW in funds. They added that the non-principal-guaranteed return of DB retirement pensions was 15.42%, the highest performance in the securities industry. Korea Investment & Securities reported that as of the end of March, their IRP funds increased by 30.1% compared to the beginning of the year, showing the highest IRP fund growth rate among large operators with over 1 trillion KRW in retirement pension funds.

The recent active promotion of being the No. 1 retirement pension operator by securities firms is interpreted as a strategic move to secure market leadership amid the continuous increase in retirement pension demand. The strategy is to gain customer trust in related products and services through the image of being the market leader. According to the Financial Supervisory Service on the 27th, the total retirement pension funds as of the end of last year were 255.5 trillion KRW, a 15.5% increase compared to 221.2 trillion KRW at the end of 2019. Experts predict that the retirement pension market, which shows an annual growth trend of over 10%, will exceed 300 trillion KRW by 2023.

Securities firms are also driving efforts to attract retirement pension customers by offering exceptional benefits. Yuanta Securities lowered IRP account fees to the lowest level in the financial sector at 0.1% earlier this month, followed by Samsung Securities and Mirae Asset Securities recently declaring full fee exemptions. An industry insider said, "The retirement pension business has a structure where the funds coming in continue to accumulate rather than flowing out," adding, "From the company’s perspective, it can maintain a stable portfolio in terms of profit indicators."

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