Temporary Reduction of Management Fees for Three Hanwha Russia Funds

[Asia Economy Reporter Hwang Yoon-joo] Hanwha Asset Management announced that it will temporarily reduce the management fees for three Russian funds starting from the 8th of this month.

By fund, the fees will be reduced as follows: △ Hanwha Russia Fund (Equity - Fund of Funds) from 0.85% per annum to 0% (no fee) △ Hanwha Eastern Europe Fund H (Equity) from 0.86% to 0.34% △ Hanwha Eastern Europe Fund No. 2 H (Equity) from 0.50% to 0.20%.

In particular, the Hanwha Russia Fund, whose main investment target is Russia, will have the largest reduction rate applied, resulting in no management fees. For Hanwha Eastern Europe Securities, reflecting that the Russia portion is about 60%, the fee is approximately 40% of the original rate.

This management fee reduction will be applied until the Russian securities market normalizes and fund trading becomes possible. When customers are able to trade the funds again in the future, the management fees will be restored to their original levels.

This temporary management fee reduction is a measure to protect customers. Earlier this year, due to the Russia-Ukraine war making trading of Russia-related assets impossible, Hanwha Asset Management decided to suspend redemptions on March 2 and held a beneficiary meeting.

Considering that sanctions against Russia have been prolonged, causing fund management and asset valuation to be abnormal, Hanwha Asset Management stated that it decided to temporarily reduce management fees for the duration of the redemption suspension period.

A Hanwha Asset Management official said, "Not all redemption suspensions justify a reduction in management fees, but in the case of Russian funds, direct asset management excluding redemption management and the proper valuation and provision of Russian stocks have become practically difficult, leading us to determine that sufficient management services are not being provided to customers, thus deciding to reduce the management fees." He added, "We hope that this management fee reduction, decided in close consultation with financial authorities, will help restore trust in the asset management industry."