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Pension funds

Ahn becomes NPS' first CIO to enter 2nd extended term

The incumbent CIO will enter his fourth year in October to serve for one more year

By Jul 29, 2021 (Gmt+09:00)

NPS CIO Ahn Hyo-joon (left) and CEO Kim Yong-jin (center)
NPS CIO Ahn Hyo-joon (left) and CEO Kim Yong-jin (center)

Ahn Hyo-joon has become the first chief investment officer of the National Pension Service (NPS) to enter a second extended term, after leading the world's third-largest pension scheme to post its strongest returns in 2019 and 2020.

The South Korean pension scheme said on Thursday it has extended Ahn's term for one more year again, ahead of the expiration of his extended three-year term on Oct. 7. He will continue to serve as CIO until Oct. 7, 2022.

After the NPS reaped its best annual return of 11.31% in 2019, the $770 billion pension fund extended Ahn's term by one year to October this year. 

Since taking the reins of the NPS' Investment Management department as CIO in October 2018, he has improved the pension fund's global investment capability and helped it achieve organizational stability, NPS' Chief Executive Kim Yong-jin said.

Between 2018 and 2020, NPS posted an average annual return of 6.54%, above its benchmark.

"CIO Ahn improved communication and cooperation between divisions to bolster the National Pension Service's investment management capability," the CEO said in a statement.

"We expect Ahn to set a precedent that the National Pension Service's CIOs can serve for a long period of time like foreign pension funds' CIOs, if they prove their ability."

Last year, the NPS' finalized return on investments came to 9.7%, its second-best annual performance in a decade. All its five asset classes beat their benchmarks for the first time in its history, generating a combined 72.1 trillion won of net investment income in 2020.

In response, its top decision-making body decided on July 2 to pay 86.7% of the basic pay of employees at the NPS' Investment Management department as a performance bonus.

The NPS also said that Ahn had led the NPS to form strategic partnerships with global pension funds and investments firms such as APG and Allianz, utilizing his global networks, while broadening its portfolio into various global assets.

Born in 1963, Ahn had served as the NPS' domestic equity division head and global securities head between January 2011 and November 2013. Then he moved to Kyobo AXA Asset Management Co., BNK Securities Co. and BNK Fincnail Group to head them as CEO between November 2013 and October 2018.

Melbourne Quarter Tower
Melbourne Quarter Tower

NPS is projected to peak at 1,700 trillion won ($1.5 trillion) in 2041 and face complete depletion in 2057.

To avoid its depletion, the NPS has been venturing into various asset classes and real estate development projects. As an example, it has recently acquired Melbourne Quarter Tower under construction for A$1.2 billion in a proprietary deal, in its largest investment in Australia.

After initiating investments in private debt in 2019 through a fund, it is now considering setting up a private debt-dedicated team next year at its earliest. 

Write to Jong-woo Kim at jongwoo@hankyung.com

Yeonhee Kim edited this article.

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