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June 2021
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Korea accident insurance fund opens tender for 400 billion won foreign mandates

Insurance fund
By Hui Ching-hoo   
June 11, 2021

South Korea’s state-owned Industrial Accident Compensation Insurance (IACI) Fund is looking to hire four domestic asset managers for 400 billion won (US$360 million) of foreign equity and bond mandates.

It will appoint three managers for the equity mandate and one for the bond mandate, with each receiving 100 billion won.

The mandates are structured in the form of fund of funds investing in foreign exchange-traded funds, IACI says in its request for proposal published on the website of the Korea Financial Investment Association on June 9.

The equity mandate is benchmarked against the MSCI All Country World Index. The bond mandate is benchmarked against the Barclays Global Aggregate Bond Index.

Applicants for the respective mandates must have a minimum three-year track record in the related investment, which must be worth at least 10 billion won.

IACI’s foreign mandates for mainstream investments are currently only open to Korean managers, according to a spokesperson for Samsung Asset Management, the fund’s outsourced chief investment officer.

“We haven’t been interested in foreign direct investment in the fund yet,” he tells Asia Asset Management.

This is IACI’s second tender in three weeks. It called bids for a 60 billion won venture capital mandate on May 21.

The fund doesn’t bar foreign firms for its alternative mandates. Last year, it awarded a 60 billion won venture capital mandate to two Korean firms – Stonebridge Ventures and Aitnum Investment – and UK-based DSC Investment.

Applications for the fund’s latest tenders are open until June 15. Evaluation and manager selection are scheduled for between June 16 and July 14.

Established in 2015, IACI provides compensation to workers injured in industrial accidents. The fund currently has approximately 23 trillion won of total assets.