이 기사는 2019년 10월 17일 08:00 thebell 에 표출된 기사입니다.

Yellow Umbrella Mutual Aid Fund, South Korea's benefit association for small-sized business owners under Korea Federation of Small and Medium-sized Businesses (KBIZ), is seeking to increase its overall allocation to overseas alternatives.

According to M&A industry sources on Monday, the mutual aid fund recently approved four investments in global blind-pool real estate funds at its investment committee meeting. It plans to invest 50 million dollars in each fund. All four investments will be made in the form of debt.

Yellow Umbrella Mutual Aid Fund seemingly focused on risk management, putting top priority on preservation of capital and a stable interest income rather than higher returns. Indeed, information on invested assets tends to be less available for limited partners (LPs) compared to general partners (GPs). However, an industry source said there is little risk of the real estate funds suffering loss as the GP forming the funds has a strong asset base with a proven track record.

"Other major overseas asset owners are also on board for the funds. The investment period is 8~10 years and an annual return of 5~6 percent is expected," said the source.

Yellow Umbrella Mutual Aid Fund is reportedly planning to make additional investments in overseas alternatives within this year due to a relatively low proportion of the asset class in its investment portfolio. Last year, the mutual aid fund's assets under management grew 30 percent to 9.48 trillion won, of which about ten percent was allocated to alternative assets.

"Yellow Umbrella Mutual Aid Fund's appetite for risk is relatively low, considering that other domestic institutional investors on average allocate about 60 percent of their assets to alternatives. Amid prolonged low interest rates, the mutual aid fund continues to seek investment opportunities in the asset class and hire additional alternative specialists," said another industry source.

KBIZ has been accelerating its efforts to enhance the competence and independence of its asset management unit since new Chairman Kim Ki-mun took office in March. It conducted restructuring earlier this year, separating the asset management team from its Mutual Aid Fund Division to be elevated to an independent unit.

(By reporter Kim Byung-yoon)