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Korea SME group seeks bids for US$3.3 billion-plus mandates

By Hui Ching-hoo   
December 20, 2021

A South Korean industry group for small and medium businesses is seeking bids from securities firms to provide brokerage and investment services for a US$3 billion foreign mandate, and an absolute return mandate comprising a $300 million overseas fund of funds and a 50 billion won ($42.18 million) domestic investment fund.

The Korea Federation of SMEs, or KBIZ, will hire four firms for the $3 billion mandate, which will focus on North American stocks and is benchmarked against the S&P 500 Index, the group says in a request for proposal on December 17.

Another two firms will be appointed for the absolute return mandate.

All the appointments are for a year, with the possibility of an extension for another year subject to performance.

Applications are open until January 4, and evaluation and manager selection are scheduled to be carried out by the end of February.

This is KBIZ’s second tender of 2021. The first was in October 2020, when it sought bids for a $300 million active global asset allocation mandate. Like most Korean asset owners, KBIZ rarely announces tender results publicly.

KBIZ was established in 1962 to safeguard the rights and interests of around 3.55 million small- and mid-sized enterprises in South Korea.