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| Seen above is the headquarters of the National Pension Service (NPS) in Jeonju, North Jeolla Province. Yonhap |
By Lee Min-hyung
The National Pension Service (NPS) sold all its shares in the now-collapsed Silicon Valley Bank (SVB) and First Republic Bank, but succeeded in offsetting losses by generating decent revenues from major U.S. tech stock investments, data showed Monday.
According to a report the NPS submitted to the U.S. Securities and Exchange Commission (SEC), Korea's state-run pension fund ended up selling 100,795 shares of SVB and 252,427 shares of First Republic Bank in the first quarter. The U.S. banking crisis caused their stock prices to nosedive more than 99 percent.
As of the end of 2022, the NPS held 72.1 billion won ($54 million) worth of shares in the two ill-fated overseas lenders. Their abrupt stock price falls are estimated to have incurred tens of billions of won in losses on the NPS. Despite the unfortunate selloffs of the shares, the NPS purchased more JPMorgan and Bank of America stocks during the first quarter.
But the pension fund is forecast to have so far offset the losses from the U.S. banking crisis by achieving more gains from other U.S. stock investments. The NPS' direct investments in U.S. stocks was worth around 74 trillion won as of the end of March, up 8 percent from the end of last year.
In a specific breakdown, large-cap tech stocks played a crucial role in helping solidify the NPS' investment portfolio. The pension fund focused on buying representative tech stocks like Apple, Microsoft, Google and Amazon during the first quarter ― the stock prices of which all soared during the same period.
The pension fund particularly snapped up 512,861 Apple shares. It also purchased more than 420,000 Google shares between January and March.
The NPS also adjusted its shareholding ratios of domestic companies. According to data from the Financial Supervisory Service, the pension fund increased its stakes in sectors such as steel and machinery. It also reduced its share ratios in the retail sector ― such as department stores ― as their overall earnings are forecast to decline amid fears of a recession and consumption slowdown.
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