Hana Asset Management to merge with Hana Alternative Asset

Hana Financial Group, the parent of Hana Bank and Hana Securities Co, will merge its two asset management arms to bolster its non-banking services, with its Chief Executive Ham Young-joo set to enter his second three-year term, according to financial industry sources on Monday.

It has embarked on the process to combine Hana Asset Management Co. and Hana Alternative Asset Management Co. as early as later this year.

On Hana Financial Group’s YouTube channel last month, Han announced the goal of boosting non-banking services to 30% of the group’s net profit from 16% at the end of 2024. Last year, the group posted a net profit of 3.77 trillion won ($2.6 billion). 

Its non-banking business’ contribution to profit is below the average 30-40% of other major domestic financial services groups such as KB Financial Group, Shinhan Financial Group and Woori Financial Group.

“Improving Hana Asset Management’s competitiveness is our top priority,” said a senior Hana Financial Group official.

Hana Asset Management was launched as a joint venture with UBS in 2007. In 2023, it became a wholly owned arm of Hana Financial Group after the group purchased the remaining 51% stake from the Swiss bank. It currently manages 36.66 trillion won in assets, ranking 13th in the domestic asset management sector.

Hana Alternative specializes in real estate and infrastructure investing with 12 trillion won in assets under management (AUM).

Despite the smaller AUM, the alternative investment manager earns about five times more than that of Hana Asset Management.

Hana Asset Management’s net profit stood at 5.4 billion won in 2024, versus 5.5 billion the year before. In comparison, Hana Alternative earned 25.5 billion won in 2024, compared with 25.4 billion won the year prior.

To increase its net profit, it will beef up target-date funds tailored for retirement funds, as well as exchange-traded funds, he added.

Before merging the two asset management arms, the financial group will make Hana Asset, currently a wholly owned unit of Hana Securities, its wholly owned subsidiary.

Their merger will create one of South Korea’s top 10 asset management firms with 50 trillion won ($34 billion) in AUM.

However, the AUM is still far below that of the country’s four other major banking groups’ asset management arms – KB Asset, Shinhan Asset, NH Amundi Asset and Woori Asset – in terms of AUM.  

KB Asset’s AUM stands at 222.56 trillion won, followed by Shinhan Asset's AUM of 161.0 trillion won.

Kim Tae-woo, a veteran fund manager, has been heading Hana Asset since 2023 as CEO. He built his reputation as a stock portfolio manager at Mirae Asset Group in the early 2000s, before joining Fidelity Asset Management to manage its flagship Korea stock funds.

In 2021, Shinhan Asset Management merged with Shinhan Alternative Asset Management. Mirae Asset Global Investments Co. was combined with Multi Asset Global Investments Co. in 2024.

Write to Jae-Won Park at wonderful@hankyung.com
 

Yeonhee Kim edited this article.