Assets under management hit all-time high in 2015

By Nam Hyun-woo

The total amount of financial assets utilized by asset management companies here reached an all-time high last year, the Financial Supervisory Service (FSS) announced Sunday.

According to data released by the top financial regulator, the sum of funds and assets held by 93 management firms totaled 818 trillion won in 2015, up 137 trillion won or 20.1 percent from a year earlier.

Of these, fund assets stood at 421 trillion won, up 11.7 percent from 2014, and discretionary assets at 397 trillion won, up 30.6 percent from a year ago.

This has led asset management companies to log 473.6 billion won as the aggregate net income, the highest since 2007. The FSS said that the growth was attributed by gains from fees and commissions by the management companies. The companies earned 1.74 trillion won in fees and commissions, up 10.1 percent year-on-year.

Among 93 companies, 73 reported net income in 2015, while 67 out of 86 were in the black in 2014. Also, 50 firms posted higher net income in 2015 and the companies’ return on equity stood at 11.9 percent, up 0.6% from a year earlier.

“The growth in the volume of assets under management and companies’ net profit was due to the increasing demand from individual and institutional investors amid continued low interest rate,” said the FSS in a statement. “However, there are lurking risks following the slowdown in the Chinese economy and another potential rise of the Federal Reserve’s benchmark rate. Moreover, asset management companies will face heated competition against other financial institutions, such as banks and securities firms in the future.”