The Korea Securities Depository (KSD) announced on Jan. 23 that the total net assets of offshore funds invested from domestic funds of funds through its foreign fund investment support service stood at 5.31 trillion won (US$4.70 billion) last year, up 68.4 percent from a year earlier.
The KSD has started its foreign fund investment support service in October 2012. The service is available when domestic funds invest in offshore funds set up in other countries in the form of a fund of funds. The investments in offshore funds through the service have grown 73.8 percent on average over the past five years.
The KSD provides all back office services that accompany investment in foreign funds, such as purchase-sale order, balance management and rights management, in an standardize and automated form through linkage with global fund platforms.
An official from the KSD said, “With our agreement on fees with global fund platforms, financial companies can reduce costs by about 70 percent compared to individual use. The utilization rate was low at the early stage of introduction due to a burden from fees. But, it is increasing as workload from the recent rise in offshore fund investment is growing and there is a growing interest in operational risks.”