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State-run pension fund's investment return slips in 2015

All News 14:16 March 02, 2016

SEJONG, March 2 (Yonhap) -- South Korea's state-run pension fund suffered a setback in its investment return in 2015 from a year earlier due to sluggish returns from stock investment, the health ministry said Wednesday.

The National Pension Service's (NPS) investment return stood at 4.57 percent last year by earning 21.6 trillion won (US$17.5 billion), down 0.68 percentage point from a year earlier.

"The decrease came as the local stock market remained sluggish at home and abroad last year," said a health ministry official.

The NPS' investment return is higher than the 2.4 percent rise in the country's benchmark index, the KOSPI, last year. The index suffered a 4.8-percent drop in 2014, when the NPS posted a 5.25-percent return.

Investment in local stocks and bonds racked up returns of 1.67 percent and 4.29 percent, respectively, last year, while the NPS' investment in overseas stocks and bonds generated yields of 5.73 percent and 1.52 percent.

The combined amount of investment assets held by the NPS reached 512.3 trillion won at the end of last year, up 9 percent from a year earlier, said the ministry.

Local bonds account for 52.5 percent of the NPS' investment assets, followed by domestic stocks with 18.5 percent. Overseas stocks and bonds take up 13.7 percent and 4.2 percent of the total, respectively.

The NPS is the country's largest institutional investor who wields influence in a company's decision-making process. It held a kind of casting vote in a landmark merger between Samsung C&T Corp. and Cheil Industries Inc. last year, backing for the merger to counter a strong challenge from U.S. hedge fund Elliott Associates.


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