Na Jae-cheol "KOSPI 3000 Era, Will Attract Pension Funds to Establish Growth Foundation"

Financial Investment Association Holds New Year Press Briefing Online

[Asia Economy Reporter Minji Lee] "For the KOSPI to surpass the 3000 mark and continue growing steadily, participation from institutional investors and foreigners is necessary. We will attract their funds to establish a solid demand base in the stock market."

On the 21st, Na Jae-cheol, Chairman of the Korea Financial Investment Association, made these remarks at an online New Year press conference. Following last year's surge of funds into the stock market driven by the 'Donghak Ant Movement' (a wave of individual stock investments), he expressed his determination to encourage participation from institutions and foreigners to ensure stable growth of the stock market. He explained, "If the asset management focus shifts from real estate to the capital market, smart national asset formation can be achieved," adding, "We will establish institutional foundations to allow long-term investment funds, such as pensions, to flow into the stock market to contribute to increasing national wealth."

Specifically, he announced plans to improve the retirement pension system by introducing default options (where financial companies manage funds with an optimal portfolio without the subscriber's instructions) and to promote public offering funds. The public offering fund activation system aims to encourage long-term investment, and the introduction of an investment-type ISA will also be pursued. Chairman Na stated, "We will foster a culture of long-term and diversified investment so that investors can participate in the stock market stably," and added, "We will continuously provide education to cultivate a sound investment culture among investors."

During the conference, plans to activate New Deal funds and establish an ESG (Environmental, Social, and Governance) consultative body were also announced. Regarding the K-New Deal, given the high interest from the investment industry, preparations are underway with member companies and New Deal infrastructure funds, and support will be provided to offer various K-New Deal funds as investment alternatives.

Currently, ESG has become a central trend in the global financial market. Although related capital is increasing significantly and the market size is growing, the domestic market is still in its infancy. Chairman Na said, "We are promoting mandatory ESG disclosures, and ESG analysis company reports led by securities firms as well as private ESG indices will be launched," adding, "We will form an ESG consultative body to respond to policy changes and identify difficulties faced by member companies to promote related institutional improvements."

He also emphasized continuing the best efforts to restore industry trust following the private equity fund incident. Chairman Na stated, "We will faithfully serve as a bridge between financial authorities and member companies to prevent recurrence of such incidents," and explained, "Special training is being provided to private equity fund sales staff to prevent incomplete sales."

Finally, Chairman Na advised individual investors to engage in effective asset management through appropriate diversification. He said, "Although the KOSPI continues its upward trend due to active participation by individuals, hasty and reckless investments such as 'Yeongkkeul' (borrowing to the limit) and 'Bittu' (investing with debt) should be avoided," and added, "A thorough evaluation of investment targets and using funds according to one's investment propensity are necessary attitudes."