Mirae Asset Global Investments plans to pay the remaining distribution for two U.S. representative index exchange-traded funds (ETFs) that were unpaid in January this year by May. The company will combine interest revenue on the remaining distribution and offer it to investors. During the delay in distribution settlement, the market share gap between the industry leader Samsung Asset Management and Mirae Asset widened to nearly 5 percentage points.
According to the financial investment industry on the 30th, Mirae Asset Global Investments recently announced that it would pay the remaining distribution amount for the 'TIGER U.S. S&P 500' and 'TIGER U.S. Nasdaq 100' ETFs, which are 20 won and 173 won, respectively, adding interest of 0.1 won and 1.3 won each. Investors will receive a total of 80 won and 389 won per share when combined with the distribution that occurred at the end of April. The distribution payment base date is the 30th, and it is scheduled to be paid on the 7th of next month.
At the end of January this year, Mirae Asset Global Investments was surrounded by controversy over underpayment, having paid only 45 won of the 65 won distribution for the TIGER U.S. S&P 500 and only 70 won of the 243 won distribution for the TIGER U.S. Nasdaq 100. At that time, Mirae Asset stated that they had conservatively set the payments considering the revisions to the foreign tax withholding tax method for funds and issues of double taxation within the tax exemption account. However, the drastic reduction in the distribution without prior notice caused confusion among investors.
In response, Mirae Asset Global Investments announced relevant principles in February of this year, including a full distribution principle for distribution resources, strengthening communication with investors, and transparency in the distribution calculation process.
Following the underpayment incident at the beginning of the year and the NAV calculation error in March, which caused investors to pay more for the ETFs than their value, Mirae Asset Global Investments' market share fell from 36.1% at the beginning of the year to 33.9% at the end of April. During the same period, Samsung Asset Management's share increased from 38.2% to 38.7%. The gap between the two asset managers, which had narrowed to 2 percentage points, widened to 4.7 percentage points.
This is largely influenced by the fact that Mirae Asset Global Investments has a high proportion of overseas stocks, such as in the U.S., in its main products, whereas Samsung Asset Management has a relatively high ratio of bond investment ETFs. The top three ETFs by net worth at Mirae Asset Global Investments are TIGER U.S. S&P 500 (77.668 trillion won), 'TIGER U.S. CD Rate Investment KIS (Synthetic)' (5.778 trillion won), and TIGER U.S. Nasdaq 100 (46.633 trillion won), all dominated by U.S. stock products.
In contrast, Samsung Asset Management has bond ETFs like 'KODEX CD Rate Active (Synthetic)' (82.903 trillion won), 'KODEX Money Market Active' (62.945 trillion won), and 'KODEX 200' (61.538 trillion won) ranking high in net worth. As the S&P 500 and Nasdaq indices fell this year, the impact on Mirae Asset Global Investments' market share is expected to be significant.
Mirae Asset Global Investments lowered its total expense ratio for U.S. S&P 500 and Nasdaq ETFs in February to 0.0068% of its previous level, which is one-tenth, aiming to attract investors. However, Samsung Asset Management followed the next day with a reduction to 0.0062%, leaving no clear results. Recently, financial authorities pointed out the excessive expense reduction competition in the asset management industry, making additional reductions challenging.
Some argue that rather than just engaging in aggressive competition such as expense reductions due to the many adversities faced by Mirae Asset Global Investments early this year, recovering brand trust is also necessary.
An official from an asset management company noted, "As Mirae Asset Global Investments started a competition to lower expenses against Samsung Asset Management, smaller firms are also feeling the pressure. Since ETFs are highly characterized by long-term investments, transparency and stability from the asset management company are important, and recovering the brand trust that has declined due to incidents this year is also a challenge."