[2025 Financial Forum] Youngpyo Oh: "Family and Business Trusts Must Be Revitalized for Innovation in the Trust Industry"

Youngpyo Oh, Executive Director of Heritage Solution Division at Shin Young Securities
"Trusts, Asset Management and Succession Tools for Others"
Attracting Attention as a Comprehensive Wealth Management Tool in the Era of Aging
Promising Prospects for the Family Trust Market
High Growth Potential for Business Trusts Utilizing STOs

There has been an argument that for the trust industry in Korea to grow in scale, both family trusts and business trusts need to be revitalized. Financial institutions must independently develop a variety of products tailored to the era of super-aging, and there is a need to introduce a system that allows not only assets but also businesses to be entrusted through the use of STOs (Security Token Offerings).

Youngpyo Oh, Executive Director of the Heritage Solution Division at Shin Young Securities, made these remarks during his lecture titled "How to Strategically Approach Innovation in the Trust Industry" at the "2025 Asia Financial Forum" held at the Westin Chosun Seoul in Jung-gu, Seoul, on the 21st. Oh stated, "This year, the size of Korea's trust market is 1,378 trillion won, which is more than double the 617 trillion won recorded in 2014." He explained, "As the elderly population increases, and as people worldwide are using trusts as a wealth management tool, combined with technological innovations such as STOs, the trust market is expected to continue to grow." According to him, a trust is a wealth management tool in which the trustor delegates authority over assets to a trustee.

He analyzed that trusts will be used as a comprehensive wealth management tool in an era of low growth and aging, and as a means of funding for the innovation economy. In particular, he estimated the size of inheritance and gift transfers in Korea and predicted that the family trust market would be promising. A family trust is a contract between a trustor, who owns assets, and a trustee, such as a financial institution, for purposes such as securing retirement funds, asset succession, or preventing inheritance disputes. Through a family trust, trustors such as parents can perform various actions regarding their assets. According to data from the National Tax Service, the average value of inherited and gifted assets from 2021 to 2023 was 90 trillion won. Oh noted, "In the United States, 30% of wealthy individuals use trusts, while in Korea, the figure is about 10%," and viewed the family trust market as one that is growing by 9 trillion won annually.

Youngpyo Oh, Executive Director of Heritage Solution Division at Shin Young Securities, is giving a lecture on the topic "How to Strategically Approach Innovation in the Trust Industry" at the "2025 Asia Financial Forum" hosted by Asia Economy on the 21st at the Chosun Hotel in Jung-gu, Seoul. Photo by Jinhyung Kang

Family trusts have the advantage of allowing for the early diagnosis and prevention of risks that may arise during the process of asset succession. Issues such as investment losses, business failures, tax problems related to inheritance or gift taxes, as well as matters like dementia, wasteful spending, or divorce, can be prevented through expert planning and management.

Oh also offered advice on how to design appropriate family trust products. He emphasized that they should be structured to reduce taxes (tax-saving trusts) and to fully preserve assets (asset preservation). He also stated that the design should include objectives such as dispute prevention and value inheritance to maintain the legacy. In addition, he suggested that the scope should be expanded within the value chain of businesses targeting the elderly population. For financial institutions, he recommended seeking business opportunities in specialized areas such as wealth management, or collaborating with experts like lawyers and accountants. He stressed the importance of financial institutions considering, over the long term, how to provide services that cover all areas from the customer's perspective.

Oh explained that business trusts utilizing STOs are also emerging as a new business area in the near future. A business trust is a concept that allows not just assets, but businesses themselves, to be entrusted through trust beneficiary securities. For example, when a singer belonging to a company produces a solo album independently, capital can be raised by issuing an STO. The business trust would include rights to profits from the solo album project, and revenue streams such as album sales, concert income, portrait rights, and merchandise would be bundled as a business and issued as beneficiary securities through an STO.