Investment Return Tops 31 Tril. Won This Year
The total assets of the National Pension Service (NPS) reached 785.4 trillion won at the end of the third quarter of this year, with more than 260 trillion won managed abroad. The investment return so far this year has topped 31 trillion won.
“The total cumulative investment return as of the third quarter of this year reached 398 trillion won, led by alternative investment as well as foreign stocks and bonds,” the NPS said on Dec. 9, adding, “The total return is estimated to exceed 400 trillion won this year with both the domestic and foreign stock markets rallying.”
The NPS was established in 1988. National pension holders have paid 615 trillion won and the NPS has paid them 219 trillion won so far. The size of the pension fund is estimated to reach 800 trillion won or so if this year’s return exceeds 400 trillion won.
In the first quarter, the return on investment fell to negative 6 percent in the wake of COVID-19. However, it rebounded to 4.2 percent at the end of the third quarter. This year, the agency has increased its overseas alternative investment such as real estate and social overhead capital investments, which has led to more investment stability and continuous profits. Its overseas alternative investment has more than doubled to approximately 70 trillion won in five years.
Under the circumstances, the influence of the NPS in the global financial market is going up. At present, it is working with Blackstone, Carlyle and KKR, the world’s three largest private equity firms, in real estate, infrastructure and private equity investments.
In June this year, the NPS bought a building in Tokyo by raising a 2.8 trillion won fund on a 50-50 basis with Allianz. Early this month, it acquired US$2 billion fulfillment centers in the United States with Stockbridge Capital Partners.