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South Korean Asset Managers Post Record Q2 Profits Driven by ETF Boom
Finance · Investment Managers · yonhap_finance · 2026-09-10
South Korean asset managers hit a record quarterly profit of 2.7 trillion won in Q2, fueled by market gains and a surge in ETF assets, though regulators warn of rising risks.
What Happened
Record-Breaking Performance: South Korean asset management firms reported a record-breaking net profit of 2.69 trillion won for the second quarter of 2026. This represents an 83.4% increase from the previous quarter, driven primarily by higher fund management fees and gains from proprietary securities investments.
ETF Market Expansion: The strong performance was largely supported by the rapid expansion of the ETF market, which pushed total assets under management (AUM) to 2,777 trillion won. Publicly offered funds, particularly ETFs, saw significant growth, with their net asset value rising by over 42% during the quarter.
Growing Industry Polarization: Despite the overall sector growth, polarization within the industry has intensified, with the proportion of loss-making firms rising to 42.9%. While public fund managers showed resilience, a significant number of private equity managers struggled to maintain profitability.
Regulatory Oversight: Financial authorities have expressed concerns over market volatility and the risks associated with excessive leverage and 'debt-financed' investments. The Financial Supervisory Service plans to tighten monitoring of vulnerable firms and implement further measures to mitigate market instability.