This article was published on the MoneyMove (MM) site of ChosunBiz on March 20, 2025, at 4:22 p.m.
It has been confirmed that the National Pension Service recovered exactly 500 billion won from the domestic equity entrusted fund of Mirae Asset Global Investments, which had a change in the person in charge. The responsible manager managing the National Pension Fund, previously held by former CEO Son Dong-sik, has now been changed to Kim Jae-hyun, head of the Equity Management Division. According to regulations, when the responsible manager changes, the National Pension Service recovers 25% of the entrusted assets.
It was also found that Mirae Asset Global Investments had ways to promise a higher revenue than the previous manager and not return the entrusted funds. However, Mirae Asset simply chose the 25% recovery option. If they fail to keep the promise, they would have to return 1 trillion won, double the 500 billion won.
According to the financial investment industry on the 20th, the responsible manager managing the National Pension's domestic equity entrusted assets at Mirae Asset Global Investments changed from former CEO Son Dong-sik to Deputy Minister Kim Jae-hyun earlier this year. The reason is that Son stepped down from management in 2023 and this year he has also retired from fund management to become an advisor.
With the change in the person in charge, the size of the National Pension Service's domestic equity entrusted fund at Mirae Asset Global Investments also decreased from 2 trillion won to 1.5 trillion won. This is because the National Pension Service has internal regulations to recover 20-25% of entrusted assets when the responsible manager is changed. Mirae Asset Global Investments returned 500 billion won, which is 25% of the entrusted fund, after discussions with the National Pension Service.
During the discussions, the National Pension Service is said to have proposed other options. One option was for Kim Jae-hyun, the successor, to manage the fund without recovering the funds and to review the performance after one year. If the revenue after one year exceeds the recent three-year average revenue of the previous manager (Son, the advisor), they would continue as is; if it falls short, recovery would occur at that time. However, if they fail to surpass the previous manager, the recovery rate would be 50%, not 25%.
For the asset management company, it is preferable to return less money, but there were many burdens in taking risks. First of all, the recent 2-3 year revenue of the National Pension Fund managed by the previous manager, Son the advisor, was very high. This raised the cut line for Deputy Minister Kim. Additionally, the state of the domestic stock market is noted as a reason for Mirae Asset agreeing to the 25% recovery, as it is not easy to bet 1 trillion won.
Son the advisor, one of the founding figures of Mirae Asset Group, is known for his outstanding management performance during his active years, increasing the funds entrusted by the National Pension Service from 300 billion won to 2 trillion won. He managed the nation’s first mutual fund, the "Park Hyun-joo Fund (Mirae Asset Park Hyun-joo Asset Allocation No. 1 Fund)." He served as the head of the equity management team, deputy minister, Chief Investment Officer (CIO), and vice president, and since 2012, he has been the representative of the equity management division.
Kim Jae-hyun, who took over the National Pension Fund from Son the advisor, graduated from the Department of Business Administration at Seoul National University and has been working in the equity management division of Mirae Asset Global Investments since November 2010. He was awarded "Fund Manager of the Year" in 2018. A relation in the financial investment industry remarked about Deputy Minister Kim, "He has long worked with advisor Son Dong-sik and is a skilled manager in operating healthcare and retirement pension funds, known for his excellent ability to discover growth stocks."