Korea Securities Depositary (KSD) has selected the Bank of New York to administer its securities lending programme. This programme will involve the offshore securities owned by the National Pension Corporation (NPC), the world's eighth largest pension fund.
NPC is a non-profit corporation established by the Korean Ministry of Health and Welfare in 1988 to address social welfare and security reforms. It was recently awarded the title "institutional investor of 2005" by AsianInvestor magazine, to highlight its transparent practices in the management of its funds.
"We were seeking to optimize portfolio performance and generate incremental revenue through our securities lending programme," says NPC's CIO Koog-jun Cho. "After a competitive review process, we appointed The Bank of New York because of its commitment to client service."
KSD has been using Bank of New York's global custody services for the last ten years. The Bank says it has been providing services to Korean financial institutions since 1971.
Bank of New York's Asia Pacific head, Kenneth Lopian notes,"This appointment illustrates our strong commitment to the securities servicing market place in Asia, which we expect to grow rapidly as institutional investors in the region pursue more complex investment strategies and opportunities."
Bank of New York tailored a customized programme so that the institutions borrowing the securities and investment of the cash collateral suit the objectives of the NPC.
Andrew Gordon, Bank of New York's Hong Kong general manager adds, "We see the NPC's involvement in securities lending as consistent with the increasing involvement of Korean institutions in international markets as they continue to invest overseas."