Shinhan BNP Paribas seeks more managers for mandates

Shinhan BNP Paribas Asset Management, which manages the radioactive waste management fund on behalf of Korea Radioactive Waste Agency (KORAD), plans to pick more external managers as total assets of the fund are on the rise.

Shinhan BNP Paribas Asset Management is looking for additional external managers to run sub-funds of an umbrella fund set up with financial resources from the radioactive waste management fund, sources familiar with the matter said on April 10.

Specifically, Shinhan BNP Paribas Asset Management plans to choose managers to take on two domestic bond mandates, three global bond mandates and two global equity mandates. It closed applications, and is expected to conduct interviews with applicants before announcing the final results on May 20.

Shinhan BNP Paribas Asset Management won a mandate from KORAD to lead the operation of the radioactive waste management fund in July 2018, when it chose 12 managers to manage 10 domestic bond mandates and two global bond mandates.

In September of the same year, Shinhan BNP Paribas Asset Management added nine external managers for equity mandates, which consisted of two passive equity mandates, four active equity mandates and three global equity mandates. It also received proposals from alternative managers last year to get exposure to alternative assets.

The radioactive waste management fund, which was created as prescribed by Article 28 of the Radioactive Waste Management Act enacted in 2008, is managed by KORAD on behalf of the Ministry of Trade, Industry and Energy. The government-backed institution awards a fund mandate, with the mandate guaranteed for three years.

The fund’s surplus for investment increased about 36 percent to 3.45 trillion won last year, from 2.52 trillion won a year earlier. Selecting additional managers, rather than putting more money in existing sub-funds, is seemingly intended to facilitate competition and thereby enhance overall returns.

“We seek to pick new managers, adding to existing external managers currently running sub-funds,” a representative of Shinhan BNP Paribas Asset Management said. “Additional managers will be selected for domestic and global bond mandates and global equity mandates.” (By reporter Kim Jin-hyun)