Hyundai Motor Securities Also Surpassed... Mirae Asset, Retirement Pension 'Fund King'

Mirae Asset Surpasses Unshakable No.1
Increases by 3.5 Trillion Won in 1 Year, Approaching 14 Trillion
Popularity of Defined Contribution & IRP Products
Securities Industry Reserves Also Rise Above 10 Trillion

[Asia Economy Reporter Ji-hwan Park] In the first quarter of this year, the retirement pension reserves in the securities industry increased by nearly 10 trillion won over the past year. In particular, Mirae Asset Securities surpassed Hyundai Motor Securities, the undisputed leader in the securities industry’s pension reserves, for the first time.

According to the Financial Supervisory Service on the 22nd, the reserves of 14 securities firms managing retirement pensions as of the first quarter amounted to 53.1367 trillion won, a 22.1% increase compared to 43.5351 trillion won in the same period last year. This is attributed to the ongoing stock market boom since last year and the popularity of retirement pension products such as Individual Retirement Pensions (IRP) tailored to the aging society, with securities firms actively competing to attract customers by offering exceptional benefits such as zero fees.

Among domestic securities firms, Mirae Asset Securities held the largest cumulative retirement pension reserves at 13.9711 trillion won. Mirae Asset Securities increased its reserves by 3.4896 trillion won over the year, overtaking Hyundai Motor Securities, which had been the undisputed leader in the industry’s retirement pension reserves. Until the fourth quarter of last year, Mirae Asset Securities trailed Hyundai Motor Securities by 613.8 billion won in reserves, but this year it successfully reversed the gap to lead by 515.9 billion won.

Mirae Asset Securities raised its market share in the retirement pension sector from 24.1% to 26.3% by increasing reserves mainly in Defined Contribution (DC) and IRP plans over the past year. Conversely, Hyundai Motor Securities’ reserves increased by only 1.212 trillion won, causing its market share to drop from 28.1% to 25.3%. The increase in Mirae Asset Securities’ reserves is attributed to high returns. As of the end of the first quarter, the one-year DC plan return rate recorded 13.75%, up 5.85 percentage points from the previous quarter. The IRP return rate also rose 4.17 percentage points to 11.37%. Among the top 10 operators by reserves, it is the only firm with both DC and IRP returns exceeding 10%.

The competition for rankings between Korea Investment & Securities and Samsung Securities, which hold the third and fourth largest retirement pension reserves, is also intense. Korea Investment & Securities’ retirement pension reserves increased by 26.7% to 7.2289 trillion won from 5.8066 trillion won in the same period last year. Samsung Securities narrowed the gap with Korea Investment by rapidly increasing its reserves by 30.2% to 6.0887 trillion won. Following them were NH Investment & Securities (3.7206 trillion won), Shinhan Financial Investment (3.2512 trillion won), KB Securities (2.7196 trillion won), and Daishin Securities (1.0475 trillion won), all with reserves in the trillion won range. They were followed by Hana Financial Investment (655.6 billion won), Hi Investment & Securities (537.1 billion won), Shin Young Securities (170.4 billion won), Yuanta Securities (122.3 billion won), Hanwha Investment & Securities (85.5 billion won), and Korea Post Securities (83.0 billion won).

Although all securities firms showed double-digit growth in reserves, Hi Investment & Securities essentially showed a stagnation trend. Its retirement pension reserves rose by only 2.7 billion won (0.5%) from 534.4 billion won in the fourth quarter of last year to 537.1 billion won in the first quarter of this year. The departure of Hyundai Heavy Industries Group’s volume, which was once part of the same group, affected the overall retirement pension performance.

An industry insider said, "Due to the simplified retirement pension transfer system, transfers from Defined Benefit (DB) plans, which have relatively low returns, to DC and IRP plans, which can expect higher returns, are expanding."

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