Asset Management Firms Set Another Quarterly Record for Net Profit... Up 424% Year-on-Year

[Asia Economy Reporter Ji Yeon-jin] Domestic asset management companies recorded their highest quarterly net profit again in the first quarter of this year. The strong market that has continued since last year, along with a significant increase in the performance of companies invested in by asset management firms, led to a new quarterly net profit record for asset management companies.

The Financial Supervisory Service reported that the net profit of asset management companies in the first quarter of this year was 615 billion KRW, an increase of 212.1 billion KRW (52.6%) compared to the previous quarter (402.9 billion KRW). Compared to the same period last year (117.2 billion KRW), it increased by 497.8 billion KRW (424.7%).

Operating profit in the first quarter was 529.5 billion KRW. Although fee income decreased by 124.3 billion KRW, operating expenses such as selling and administrative expenses (156 billion KRW) were reduced, resulting in a 31.7 billion KRW (6.4%) increase compared to the previous quarter. The companies invested in by domestic asset management firms showed improved performance, leading to an increase in equity method gains, and non-operating income rose by 153.7 billion KRW (218.1%) compared to the previous quarter.

Among companies, 259 out of 328 recorded profits, while 69 posted losses, reducing the ratio of loss-making companies by 0.8 percentage points compared to last year (21.8%). Additionally, among professional private equity investment managers, 62 out of 253 (24.5%) recorded losses, a 0.6 percentage point increase from last year's loss ratio (23.9%). The return on equity (ROE) of domestic asset management companies in the first quarter was 25.7%, up 7.8% from the previous quarter (17.9%).

As of the end of March, the assets under management of asset management companies stood at 1,237.8 trillion KRW, an increase of 40 trillion KRW (3.3%) compared to the end of last year (1,197.8 trillion KRW). Fund custody assets were 722.5 trillion KRW, and discretionary investment contracts amounted to 515.3 trillion KRW, increasing by 30.6 trillion KRW (4.4%) and 9.4 trillion KRW (1.9%), respectively.

During this period, the number of asset management companies increased by 4 to 330 compared to the end of last year, and the number of employees rose by 324 (3.3%) to 10,291.

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