The government-owned Korea Development Bank (KDB) will launch an offshore fund of funds to invest in global private equity funds, with $200 million scheduled to be put into the vehicle by the bank this year.
Industry sources said on September 23 that the bank’s board of directors recently agreed to establish the fund to expand KDB’s exposure to foreign private equity funds as part of efforts to enhance its investment returns.
The fund of funds will be managed by KDB Asia Limited, the development bank’s Hong Kong office, whose operations include lending for non-residential properties, syndication finance and asset management. KDB Asia Limited will allocate the vehicle’s capital to global private equity funds that exceed 1 trillion won ($855 million).
With the launch of the offshore fund, it is expected that KDB will be able to streamline its investment capabilities and manage its portfolio of foreign private equity in a more efficient manner, industry watchers said. (Reporting by Hee-yeon Han)