Hansongseok, Director of Financial Investment at Police Mutual Aid Association, "Focusing on Liquidity Securing in 1Q... Considering Increasing Stock Proportion"

100 Trillion Market Opens... Preparing IPO Funds
Plan to Increase Stock Ratio from 3% to 6%
Expansion of VC and Activist Fund Capital Deployment

[Asia Economy Reporter So-yeon Park] "Securing liquidity is the top priority in the first quarter."

Han Jong-seok, Director of Financial Investment at the Police Mutual Aid Association, recently told Asia Economy, "With the prices of stocks, bonds, and real assets all falling, volatility and uncertainty in the financial markets are increasing," adding, "This year will be a challenging period for the Association's fund management." Han said, "In the highly uncertain first quarter, we will focus on securing liquidity by postponing investment execution."

The Police Mutual Aid Association is one of the major players in the market, with total assets of 5 trillion won and investment assets worth 4 trillion won. Although the financial statements are not yet finalized, it is estimated that last year's fund management return was in the 5% range. Han noted, "Last year, venture capital (VC) and private equity fund (PEF) investment returns were high," and hinted, "VC returns exceeded 20%."

Han, who took on the role of Director of Investment Finance in the second half of last year, plans to increase the relatively low stock investment ratio compared to other investment institutions. He explained, "We are preparing to raise the stock investment ratio from the existing 3% range to about 6%, an increase of approximately 3 percentage points."

Considering stock market uncertainties, the plan is to increase the stock ratio focusing on public offerings and venture funds rather than existing listed stocks. Han said, "We expect a public offering market worth 100 trillion won to open this year," adding, "We are preparing a public offering fund that pension funds and mutual aid associations have considered a niche until now." He also mentioned, "I recently participated directly in the LG Energy Solution public offering."

Additionally, investments will be made in activist funds that secure certain voting rights to demand asset sales, dividend increases, and governance improvements from companies. The green energy sector is another area of interest for Han. He said, "I believe that moving in the direction everyone desires ultimately leads to investment returns," and added, "Technologies in eco-friendly energy fields such as solar, wind, and biomass power generation have reached a sufficient level, so we will actively invest."

Regarding investments in assets with maturities such as bonds and real assets, he said, "Uncertainty will be significant for the next 10 years," and added, "We will focus on investing in assets with relatively short durations that have good market responsiveness." He also said, "The Police Mutual Aid Association's bond ratio is 30%, and among these, we are considering using long-term bonds for securities lending and repurchase agreement (RP) transactions."

Meanwhile, Han Jong-seok, born in 1967, graduated from Seoul National University with a degree in Business Administration and completed graduate studies at the Business School. He has served as Vice President of K-Fin Asset Management, CIO of Meritz Asset Management, and Head of Equity Management at KTB Asset Management. He was appointed Director of Financial Investment at the Police Mutual Aid Association on October 25 last year.