Shinhan Bank: "Use Asset Allocation Strategies Considering Liabilities for Corporate Retirement Pensions"

Consulting Services Utilizing Proprietary IPS Operation Platform

[Asia Economy Reporter Minwoo Lee] Shinhan Bank is providing consulting services based on Liability-Driven Investment (LDI) to companies enrolled in retirement pension plans. Through this, it plans to comprehensively review matters related to retirement benefit liabilities and assist in establishing asset management plans.

On the 3rd, Shinhan Bank announced that it will expand its LDI-based Investment Policy Statement (IPS) consulting services, the first of its kind in Korea, to companies enrolled in defined benefit (DB) retirement pension plans.

Following the amendment of the Employee Retirement Benefit Security Act in April, which mandates the establishment of a Reserve Fund Management Committee and the introduction of an IPS for DB workplaces with more than 300 employees, the bank plans to actively utilize its self-developed IPS management platform. The IPS management platform standardizes and provides processes from setting target returns considering the client company's investment preferences (risk tolerance) through LDI, an asset allocation strategy that takes liabilities into account, to strategic asset allocation, final product proposals, and performance evaluation.

With this service expansion, Shinhan Bank plans to offer clients an integrated solution for managing retirement benefit liabilities and asset management, including ▲long-term trend analysis of retirement benefit liabilities ▲support tools for comprehensive history management related to retirement benefit liabilities such as risk assessment ▲capital market forecast scenarios generated by artificial intelligence (AI) algorithms ▲and liability market risk hedging based on LDI strategies.

Additionally, through the self-developed IPS management platform, the bank supports the creation of customized consulting reports and automatic generation of reserve fund management plans.

A Shinhan Bank official said, "Since customers entrust us with the largest amount of retirement funds, we will provide differentiated services and repay them with high returns," adding, "We will further enhance convenience by expanding IPS consulting services to online channels in the future."

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