Capital’s new products aim at retired workers

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Capital’s new products aim at retired workers


Samsung’s Koo Sung-hoon, left, and Capital’s Timothy Armour with the agreement. Provided by the company

Capital Group, one of the world’s largest investment management firms, and Samsung Asset Management are joining hands to develop asset management and allocation products tailored to Korean retirees.

The jointly developed products mainly target middle-aged workers and senior citizens who are in need of sustainable and long-term asset accumulation and management programs. The partnership will also help expand cooperation with other Samsung financial affiliates, such as Samsung Fire & Marine Insurance and Samsung Life Insurance.

Samsung Asset Management CEO Koo Sung-hoon and Capital Group Chairman Timothy Armour signed a strategic partnership agreement on Wednesday at the Shilla Hotel in central Seoul to develop products and exchange investment expertise.

“Korea, like other Asian countries, is facing demographic challenges in meeting the long-term financial needs of an aging population,” Armour said.

“The partnership with Samsung will help address the need of a wide range of retirement solutions in Korea and also encourage investment planning, diversification and education.”

“The partnership will help Samsung Asset Management strengthen the management capability of equity-linked fund programs, so we can provide the best asset management results,” Koo said. “With existing investment methods in Korea, which are mostly short-term and one-sided, it is insufficient to gear up for retirement life with low growth, low interest rates and an aging society.”

According to Statistics Korea, Korea’s senior population aged 65 and older is expected to account for more than 37 percent of the population by 2050, compared to 13 percent in 2014.

The two firms started designing joint products two months ago. The first product is slated to launch in the first quarter of next year.

So far, Korean asset management firms have created a portfolio for pension investment products by mostly considering returns, Koo explained. But the new retirement investment products will have a more diversified portfolio, mixing different kinds of investment sources like value-oriented and dividend-oriented stocks, as well as bonds. The portfolios will be more diversified and specified, not only addressing countries but also specific market sectors.

The partnership between Samsung and Capital aims to bring a change in the Korean asset management and investment cultures, the two CEOs said.

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