중앙데일리

Brokerages Find Size No Obstacle

May 29,2001
Hannuri Investment & Securities Co. is a brokerage house with 95 employees and no branch office. It is not an online brokerage firm but a full-fledged securities company with a capital stock of 50 billion won ($38.6 million), offering an array of services, including institutional equity, fixed-income sales and financial consulting.

Last year, Hannuri earned 9 billion won after tax, making the firm the most productive securities house in Korea on a sales-per-broker basis for the second straight year. Still, Hannuri is not very well-known here because it focuses on wholesale financing for corporate and institutional clients.

"I think our specialized strategy for corporate financing has proved successful," said Choi Jin-shik, an executive at the company.

Other local securities companies are following suit, dropping the stereotyped pattern of earning commission income from equity brokerage. Many firms are focusing on specialties to find other sources of income because the spread of online stock trading has led to lower trading fees.

Small newcomers are searching for unique profit models. More Securities, a house set up with 3 billion won of capital early last year, chose an operating strategy that was in direct opposition to the trend. While most other firms in the industry were striving to establish or beef up their Internet trading systems, More Securities concentrated on specialized offline business, targeting investors with deep pockets.

Leading Securities Co., which was also established last year, is the only securities firm not located on what is called Korea's Wall Street - Yeouido. To focus on asset management and initial public offering for start-up companies, Leading Securities set up its office in Yeoksam-dong, southern Seoul, where a number of high-tech firms are clustered. It posted 1.2 billion won of net profits in its first year of operation.

Kiwoom.com Securities Co. concentrates on online trading and fixed-income operation, and Getmore Securities Co. specializes in Internet trade in futures and options for individual retail investors.

Large trading houses also feel the need to find new profit sources and develop their own specialties. Daishin Securities Co. has charted its future course as an online brokerage firm like Charles Schwab, a U.S. online stockbroker.

Daishin drastically reduced its international business, closing its overseas operations in New York and London to become more competitive in Internet trading. It now has about a 50 percent share of the online futures and options trading in Korea.

Taking a different tack, Samsung Securities Co. and LG Investment & Securities Co. said they plan to strengthen their investment-banking business to become market leaders.



by Kim Kwang-ki




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