Korea Investment & Securities is rolling out its eighth comprehensive investment management account (IMA) product, a vehicle designed to deliver annual returns of 4.5% or more.
The brokerage said on the 12th that it had launched "Korea Investment IMA S7" and would take subscriptions through the 15th for a total of 200 billion won ($139 million). The product invests in corporate finance assets, including loans to blue-chip Korean conglomerates and mid-sized companies, acquisition financing loans and global credit funds that make private loans. Korea Investment & Securities takes responsibility for repaying the principal at maturity, and if the product meets its benchmark return of 4.5% a year — roughly 9.0% over the two-year investment period — investors receive the entire gain with no performance fee. Of any return above the benchmark, 60% goes to investors and 40% is deducted as a management fee.
The brokerage also added cross-selling incentives aimed at attracting money from wealthy clients. Subscribers through its online channel BanKIS get a purchase limit for specially issued promissory notes worth up to five times the amount they put into IMA S7. Within a per-person cap of 5 billion won, the notes carry preferential rates of 5.0% a year for one-year maturities and 4.7% a year for six-month maturities. Investors putting in 30 million won or more also receive mobile gift certificates worth up to 500,000 won, depending on the size of their subscription.
"IMA S7 is designed to let investors enjoy both the stability of principal protection and the appeal of performance-based payouts by spreading money across proven, high-quality corporate finance assets," an official at Korea Investment & Securities said. "We will keep expanding our differentiated IMA lineup to meet the needs of investors looking for stable returns above market interest rates."