Securities firms extend contracts of top management on stock market uncertainties

Buildings in Seoul's financial district, Yeouido. Yonhap

Brokerage houses place stability over risk-taking amid stock uncertainties

By Lee Min-hyung

Major securities firms have decided to extend the terms of their leaders, as part of efforts to maintain stability amid escalating uncertainties in the stock market.

According to the industry, most leaders of major and mid-tier securities firms will be able to serve another term, after achieving outstanding earnings last year when the benchmark KOSPI set a new high.

During its regular shareholders' meeting last week, Meritz Securities decided to extend the term of Vice Chairman Choi Hi-moon for another three years. Choi took office as the leader of the securities firm in April 2010. If he maintains the post until 2025, he will become the longest-serving CEO in the industry here.

Daishin Securities also reappointed Vice Chairman Yang Hong-seok and CEO Oh Ik-keun as its top management during its recent shareholders' meeting.

NH Investment & Securities is set to extend the term of CEO Jeong Young-chae during its upcoming shareholders' meeting slated for March 23. He rose to the top post in 2018 and succeeded in extending his term once in 2020. If he wins approval, he will be able to lead the company until the end of March 2024.

The top bosses of other industry-leading securities firms ― such as Mirae Asset Securities, Korea Investment & Securities and KB Securities ― were all reappointed. Mirae Asset Securities Chairman Choi Hyun-man was promoted to the chair position late last year in recognition of his decades-long efforts as a founding member in turning the company into the nation's top securities firm.

The decisions by the brokerage houses are a reflection of widening stock uncertainties sparked by multiple external risk factors, such as the outbreak of war in Ukraine and the U.S. Federal Reserve's rate hikes.

After reaching a new high in June 2021, the Korean stock market has since been on a gradual downward trajectory due to weakening investor sentiment. With the Fed and the Bank of Korea set to push for aggressive rate hikes throughout this year, investors have remained uneasy about betting on stocks in emerging markets, including Korea.

“Securities firms appear to have prioritized stability over risk-taking by maintaining their leadership this year, when the uncertain market circumstances are expected to remain in place,” an industry analyst said.