Korea Post is looking to hire a custodian bank and a fund manager to provide asset custody and administration services for its investment mandates for three years.
The bank will be responsible for compliance and securities settlement, among other things, and the fund manager will handle verification of investment data, calculation of net asset value, as well as support securities trading, Korea Post says in a request for proposal published on the website of the Korea Financial Investment Association on November 20.
The tender is open until Dec 4. Evaluation and due diligence are scheduled to be carried out between December 18 and December 23.
Applicants must be Korean-registered financial institutions. The term of appointment starts on April 1, 2021.
Korea Post has outsourced more than ten mandates thus far this year, including for private equity and infrastructure investments. Some market participants believe the postal agency needs more sophisticated administration support for its diversified portfolios.
Top Korean asset owners such as the National Pension Service, the world’s third largest pension fund, are outsourcing their data management and performance management services as their investment models become more complex, according to a fund manager in Hong Kong.
“We believe the new custodian bank and fund manager will have to provide more comprehensive back and middle-office services to Korea Post as the postal agency continues to raise its allocation to global and alternative assets,” the fund manager tells Asia Asset Management, speaking on condition of anonymity.
Korea Post had around US$106 billion of total assets as of December 2019.