Expected Chain Movement Among Securities Firms Following Head Yujanghun's Resignation
Each Securities Firm Restructures Organization and Personnel to Prepare for IPO Winter
[Asia Economy Reporter Hwang Yoon-joo] As the initial public offering (IPO) market environment is expected to be challenging this year, securities firms are reorganizing their IPO teams and personnel. This is due to the difficulty of securing 'big fish' like LG Energy Solution last year and the consecutive cancellations of large deals.
According to the securities industry, Yu Jang-hoon, head of Corporate Finance 1 at the IB1 Division, who oversaw IPO operations at Samsung Securities, is scheduled to resign at the end of February. He is currently on extended leave to use up his annual leave. A Samsung Securities official stated, "We are considering recruiting an industry veteran as Yu's successor." It is expected that Yu's successor will move from another securities firm, which will likely lead to subsequent IPO executive personnel changes at that firm as well.
Despite sluggish IPO activity, Samsung Securities attracted industry attention last year through SPAC listings. The industry views this personnel change as Samsung Securities shifting toward a more conservative strategy.
Earlier, organizational restructuring and personnel changes occurred in the corporate finance (IB) divisions across the securities industry. This reflects the judgment that competition in sales will intensify due to the unfavorable IPO market this year.
KB Securities drew attention with its personnel moves. At the end of last year, KB Securities appointed Yoo Seung-chang, Research Center Director (Managing Director), as head of the Equity Capital Markets (ECM) division. Accordingly, Shim Jae-song, head of IB1 Division, relinquished his concurrent role as ECM head to focus on his primary duties.
It is not uncommon for research center directors to move to corporate sales or retail divisions. A recent example is Yoon Ji-ho, Research Center Director at eBest Investment & Securities, who was promoted to head of the retail business division. However, appointing a research center director as ECM head is rare.
KB Securities is not traditionally a powerhouse in the IPO sector. However, by becoming a joint lead manager for LG Energy Solution last year, it quickly rose to the top spot. This personnel move is interpreted as a declaration of intent to maintain its position as an IPO leader by discovering companies ready to go public amid a difficult environment for large IPOs. A securities industry insider explained, "This signifies an effort to identify companies with IPO potential and strengthen valuation analysis for companies preparing to go public through a research center director."
Shinhan Investment Corp. recruited Seo Yoon-bok, formerly of NH Investment & Securities, as 'Head of IPO Division' in July last year. His move was a hot topic in the IB industry because he was a prominent talent at NH Investment & Securities, a leading ECM firm. It is known that Shinhan Investment Corp. President Kim Sang-tae personally recruited Seo to strengthen the IB division. Shinhan Investment Corp. had been evaluated as relatively weak in IPO underwriting performance compared to its capital scale and brand power. This move is seen as a strategic measure to overcome that. After joining, Seo took charge of IPOs such as Daesung Hi-Tech and Double UCP (WCP).
After recruiting Seo in the first half of last year, Shinhan Investment Corp. split the existing GIB Group into two groups in the year-end personnel reshuffle. This is interpreted as an effort to enhance competitiveness in the IB business. GIB1 Group handles alternative investments and unlisted investments, led by Group Head Jung Geun-soo. GIB2 Group is responsible for ECM and Debt Capital Markets (DCM), headed by Kim Jun-tae, head of the IB Comprehensive Finance Division.
After Seo Yoon-bok, who was head of ECM1 Division at NH Investment & Securities, left last year, the firm conducted department head appointments. ECM1 Division is led by Manager Kim Ki-hwan, ECM2 Division by Manager Kwak Hyung-seo, and ECM3 Division by Manager Yoon Jong-yoon. All were promoted internally from RM positions.
NH Investment & Securities, along with Korea Investment & Securities, is known as a prestigious IPO firm. It is recognized as a house with the strongest manpower, and those promoted internally have over 15 years of experience as RMs. NH Investment & Securities' IPO personnel moves appear to be a response to the increasingly competitive IPO environment by injecting 'young talent' proven within the company.
A Korea Exchange official said, "The market outlook is unfavorable as there are expected to be few large IPOs like LG Energy Solution last year," adding, "The IPO performance of securities firms will depend on how well they succeed in mid-sized IPOs."
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