NPS in emergency system under acting CIO, global alternatives head

The National Pension Service (NPS) has begun running an emergency inspection system for its investment management department with the appointment of acting chief investment officer and global alternative investment head, the South Korean pension fund said on July 25.

In-Sik Cho, global public market head, was appointed as acting CIO on July 22, a day after the world’s third-largest pension scheme accepted the resignation of Myoun-Wook Kang as CIO following the appointment cancellation of new global alternative division head.

Hyung-Don Choe, global private equity head, will temporarily take the reins as head of global alternative investment division. Global private equity team is under the global alternative investment division.

“Our investment management department will hold a daily emergency inspection committee meeting consisting of nine members - acting CIO, each investment division head and risk management chief - until new CIO takes office,” NPS said in a statement.

The nine-member committee held its first emergency meeting in the morning of July 24 to step up risk management.

The $500 billion pension fund is in an unprecedented leadership vacuum with the posts of both CEO and CIO remaining empty.

Ex-CEO and Chairman Hyung-Pyo Moon stepped down earlier this year after indicted by prosecutors for abusing power over the 2015 merger of two Samsung units. Former CIO Kang resigned seven months before the end of his two-year term.

It may take several months before the NPS returns to normalcy given the procedures it has to follow to appoint new CEO and CIO.

NPS’ chief executive needs to win a recommendation of Welfare Minister Neung-hoo Park, who was installed last week, to be appointed by President Moon Jae-in.

Chief investment officer needs to be recommended by CEO to be appointed by welfare minister. CIO has the power to name global alternative investment head.

Acting CIO Cho has been mainly charged with risk management since joining the NPS in 2011. After picked as domestic equity market head last year, he was credited with the improved evaluation system of external equity management companies.

Choe, interim global alternatives head, is the longest-serving asset manager in the NPS’ global alternative investment division. He has been involved in private equity investments for both domestic and global alternative investment divisions since entering the NPS in 2006.

By Chang Jae Yoo

yoocool@hankyung.com