South Korea’s KB Asset Management Co. ended its delegated management agreement for public funds with Vietnam’s largest asset management company, Dragon Capital, opting to operate independently.
This strategic decision reflects KB Asset Management’s confidence in its strengthened capabilities to manage investments in the Vietnamese market.
According to the financial investment industry on Friday, KB Asset Management began directly managing its actively managed Vietnam investment fund, KB Vietnam Focus, starting last month.
This fund invests in Vietnamese-listed companies and pre-IPO firms, focusing on businesses in sectors like utilities, construction, and trade, which exhibit growth potential and stability in Vietnam.
Previously, KB Asset Management had entrusted Dragon Capital with managing the fund.
Founded in 1994, Dragon Capital is the oldest asset management company in Vietnam, managing over $6.1 billion in assets.
KB Asset Management relied on Dragon Capital’s local expertise to manage its funds. However, the company’s other Vietnam fund, KB Star Vietnam VN30,” which tracks an index, was never outsourced.
KB Asset Management is also reducing its reliance on local asset managers in other markets, including China. While it has partially delegated portfolio management for its China investment funds to Hong Kong-based GAM Hong Kong Limited and China’s major asset manager, Harvest-Bosera Asset Management, it is steadily lowering the proportion of outsourced management.
The move reflects KB Asset Management’s growing confidence in its capabilities to directly manage overseas markets.
In 2019, the company established an office in Vietnam to serve as a foothold for market entry, sending fund managers from its headquarters to strengthen its research and management capabilities. Similarly in 2018, it established a Shanghai office and gradually reduced its reliance on local Chinese asset managers.
By Jeong-sam Koh
jsk@hankyung.com
