Kim Sung-hwan, president of Korea Investment & Securities Co., said global financial firms consider data centers the most watched investment destination in Korea.
Kim held a press briefing after the "KIS Night" event on the 10th (local time) at Lotte New York Palace in New York, saying, "When we discuss investment opportunities in Korea with global financial firms, the field that comes up the most these days is data centers." KIS Night is an investor relations (IR) event where Korea Investment & Securities Co. invites global financial firm officials to introduce the Korean market and its business strategy.
Kim said, "We live in the age of artificial intelligence (AI), and for AI to be applied to real industries and services, data centers are necessary," and added, "Data centers require massive funding not only for electricity and water but also for buildings and graphics processing units (GPUs)." He went on, "We discussed many ways to jointly raise and invest the funds needed for Korea's data center business with global financial firms." He also cited semiconductors and defense as Korean industries that attract strong interest from overseas investors.
Korea Investment & Securities Co. holds the No. 1 market share in Korea's data center financing market, according to Kim. Citing this, he emphasized there is significant room to raise funds together with global financial firms.
Korea Investment & Securities Co. expanded partnerships with Fidelity, Carlyle and PIMCO during this trip. Kim said, "We will not stop at bringing overseas managers' products into the domestic market to sell them, but will expand cooperation by jointly creating products or sourcing new investment banking (IB) transactions." With Fidelity, it is jointly developing a Korea-China-U.S. fund in which Fidelity handles U.S. and China assets and Korea Investment Management handles Korean assets.
It also discussed cooperation with global asset managers on managing individual managed accounts (IMAs). Kim said, "For IMAs, when clients request funds, they must be able to cash out immediately, so we need products that have liquidity while earning interest," and added, "We are reviewing related products with global asset managers, including credit."
He expressed caution about the recent rise in U.S. Government Bonds yields. With the 10-year U.S. Treasury yield nearing 5% annually, the bonds managed by Korea Investment & Securities Co. exceed 40 trillion won. Kim said, "Nearly all of a securities company's businesses are sensitive to interest rates, so bond management is not easy," adding, "We are adjusting maturities in line with economic indicator releases and currency policy meetings, and using hedging and portfolio diversification strategies." It also plans to expand products that pay interest or dividends monthly by taking advantage of the high-rate environment.
By contrast, it decided to scale back the business of directly acquiring overseas real estate and other alternative investment assets and turning them into products. Kim said, "Overseas alternative investment assets have seen greater value fluctuations due to shifts in demand and tenants," adding, "Rather than investing directly, we are focusing on structuring products by leveraging global managers' capabilities and supplying them to domestic clients."
Korea Investment & Securities Co. has held KIS Night in New York, Hong Kong and other locations since 2024. This is its third year. Kim said, "You can't clinch a transaction just by meeting once or twice," adding, "Our goal is to build trust through repeated meetings and connect that to joint products or investment transactions."