이 기사는 2020년 02월 26일 08:00 thebell 에 표출된 기사입니다.

South Korea’s National Pension Service (NPS) has recently sold shares in Samsung Life Insurance for the first time in four years. The pension fund has also changed its officially listed purpose for holding shares to “general investing” from “non-engagement investing.”

According to the Financial Supervisory Service (FSS) on February 19, the NPS sold more than 400 thousand shares in the life insurer on January 31 during the day’s regular trading hours. Based on the day’s closing price of 69500 won, the pension fund sold 27.9 billion won worth of shares. After the selling, the NPS’ stake in Samsung Life has decreased to 5.9 percent from 6.1 percent.

The selling comes for the first time in four years after the pension fund unveiled its major shareholders under the 5 percent stake ownership rule in October 2016. The pension fund bought more than 2.2 million additional shares in July 2017 to increase its stake in the life insurer to over six percent and maintained ‘hold’ ever since. Market watchers say despite its modest amount, the NPS might have a clear background to make such decision.

It seems that the pension fund decreased its stake in the life insurer due to deteriorating insurance industry. South Korea’s life insurance companies register alarming slowdown in financial performance due to prolonged low-interest rate regime. Their efforts to diversify product portfolios also don’t seem to bear fruits just yet, while most of insurers suffer from a sharp decrease in new contracts.

South Korea’s leading life insurer Samsung Life also recorded worst financial performance last year. The life insurer’s net profit was 977 billion won in 2019, dropping 41.3 percent from 1.66 trillion won in 2018. The life insurer delivered a solid net profit in 2018 due to one-off gain from the selling of Samsung Electronics’ shares. Market watchers say that the decrease in net profit is still huge despite the previous year’s one-off item.

The life insurer’s shares have also remained sluggish around 60000 won level recently, which was as high as 138500 won in 2018. Especially, the shares have dropped a lot over the past three months. The life insurer posted poor financial performance on February 18, pushing its shares to as low as 65600 won on the following trading day.

In the meanwhile, the NPS has changed its officially listed purpose for holding shares in the company to “general investing” from “non-engagement investing.”

For general-investing purposes, the NPS will be allowed to exercise shareholder rights more actively including making decisions on executive salaries, dismissal of executives and dividend payouts.

The NPS adopted stewardship code guidelines aimed at more active shareholder activism in July 2018. The most powerful trigger was criticism over the pension fund’s controversial vote in favor of a merger between Samsung C&T and Cheil Industries, back in 2016.

The pension fund’s latest change of its purpose for holding shares in Samsung Life may have come to exercise shareholder rights more actively at the company’s Annual General Meeting to be taken place in March.

The NPS voted against some of Samsung Life’s resolutions in the past. The pension fund voted against a resolution on pay raise for executives at the General Meeting in March 2018, while the fund didn’t cast any dissenting votes in 2019. The NPS may take a totally different stance at this year’s General Meeting.

(By reporter Kim Jang-hwan)