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Korea's National Pension Fund to increase domestic stock exposure

22 June 2012

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South Korea's National Pension Service (NPS), one of the world's largest pension schemes, plans to buy KRW 6.6tn (£3.6bn) in domestic equities next year.

The nation's biggest investor will increase the weighting of domestic stocks in its holdings to 20% of assets in 2013, a goal that was initially set for 2016.  

With the move NPS shows its support for equities amid Europe's debt crisis, which remains largely unchanged even after Greece's pro-Euro vote yesterday.

As of the end of December 2011, the market value of equity stood at KRW 81.9tn which accounts for 24% of the total portfolio. The fund manages roughly half of that in-house and the rest via external managers.  

The fund aims to pare its domestic bond weighting to 56.1% of assets in 2013, less than the 59.3% it said to have targeted for this year.

The NPS overseas investments will be brought down a few per cent. Currently some of the bigger projects include stakes in London's Gatwick Airport and HSBC's headquarters which is located in the city of London.

The fund's size is expected to grow to KRW 430tn by the end of 2013 from KWR 365tn as of March 2012.

 

Published 18.06.2012

azeevalkink@wilmington.co.uk