Aegis Asset Management Receives Consecutive Corporate Rating Upgrades from Credit Rating Agencies

[Asia Economy Reporter Ji-hwan Park] Aegis Asset Management announced on the 18th that Korea Ratings Corporation (hereinafter referred to as KCR) has upgraded its long-term credit rating from BBB+ (stable) to A- (stable) and its short-term credit rating from A3+ to A2-.

Earlier in November last year, Korea Credit Rating also upgraded Aegis Asset Management's credit rating to the same level as KCR. As a result, Aegis Asset Management has obtained the same rating from both credit rating agencies that evaluated its credit rating, and it is expected that the financing rates from financial institutions will gradually decrease in the future.

KCR stated that it adjusted Aegis Asset Management's credit rating considering △ its good business stability based on specialized business capabilities in the real estate fund sector △ an excellent profitability with an average return on assets (ROA) of 18.5% over the past three years △ and the improvement in capital adequacy indicators due to a paid-in capital increase.

Seonju Kim, a researcher at Korea Ratings Corporation, evaluated, "Aegis Asset Management has been continuously entrusted with discretionary management by major institutional investors based on accumulated reputation and credibility, and smooth fundraising is being carried out in blind funds and public funds as well. Although the average fee rate is declining due to intensified competition across the asset management industry, Aegis Asset Management maintains excellent profitability through continuous growth of entrusted assets and smooth disposals."

As of March 2020, Aegis Asset Management's real estate-related entrusted assets amounted to 14 trillion KRW, more than four times the 3 trillion KRW at the end of 2014. At the same point in time, its market share of real estate fund entrusted assets was 13.3%, maintaining the largest share in the industry since 2016.

KCR explained that thanks to two paid-in capital increases of 63.95 billion KRW last year and 20 billion KRW this year, the debt ratio significantly improved to 59.7% as of the end of March 2020, compared to 146.7% at the end of 2018.