Korea Investment Corporation
Encyclopedia
The Korea Investment Corporation (KIC, Korean
: 한국투자공사) is a global investment management company established by the Government of South Korea
in 2005 by the Korea Investment Corporation Act. The company manages some of South Korea
's foreign reserves, specializing in overseas investments. Although the KIC is government-owned and government-established, it runs commercially and independently.
The KIC initially received US$ 17 billion of foreign exchange reserves
from the Bank of Korea
and US$ 3 billion of foreign exchange stabilization fund from the Ministry of Finance and Economy
of Korea.
On January 15, 2008, the KIC invested $2 billion in Merrill Lynch & Co
, a United States
-based financial services
firm.
According to Maeil Business Daily (March 2, 2009), one of leading business publications in South Korea, the investment losses have been mounting. The Merrill purchase has yielded as much as 80% negative return as of February 25, 2009. Moreover, with limited prospect of getting additional funding due to the controversy at home, the fund does not seem to have much investable cash left in its coffer.
Korean language
Korean is the official language of the country Korea, in both South and North. It is also one of the two official languages in the Yanbian Korean Autonomous Prefecture in People's Republic of China. There are about 78 million Korean speakers worldwide. In the 15th century, a national writing...
: 한국투자공사) is a global investment management company established by the Government of South Korea
Government of South Korea
The Government of South Korea is divided into executive, judicial, and legislative branches. The executive and judicial branches operate primarily at the national level, although various ministries in the executive branch also carry out local functions. Local governments are semi-autonomous, and...
in 2005 by the Korea Investment Corporation Act. The company manages some of South Korea
South Korea
The Republic of Korea , , is a sovereign state in East Asia, located on the southern portion of the Korean Peninsula. It is neighbored by the People's Republic of China to the west, Japan to the east, North Korea to the north, and the East China Sea and Republic of China to the south...
's foreign reserves, specializing in overseas investments. Although the KIC is government-owned and government-established, it runs commercially and independently.
The KIC initially received US$ 17 billion of foreign exchange reserves
Foreign exchange reserves
Foreign-exchange reserves in a strict sense are 'only' the foreign currency deposits and bonds held by central banks and monetary authorities. However, the term in popular usage commonly includes foreign exchange and gold, Special Drawing Rights and International Monetary Fund reserve positions...
from the Bank of Korea
Bank of Korea
The Bank of Korea is the central bank of South Korea and issuer of South Korean won. It was established on June 12, 1950 at Seoul, South Korea.The Bank's primary purpose is price stability. For that, the Bank targets inflation...
and US$ 3 billion of foreign exchange stabilization fund from the Ministry of Finance and Economy
Ministry of Finance and Economy (South Korea)
The Ministry of Strategy & Finance or MOSF oversees the financial policies of the South Korean government. It publishes a monthly report on the national economy, known as the "Green Book." The current minister is Yoon Jeung-Hyun....
of Korea.
On January 15, 2008, the KIC invested $2 billion in Merrill Lynch & Co
Merrill Lynch
Merrill Lynch is the wealth management division of Bank of America. With over 15,000 financial advisors and $2.2 trillion in client assets it is the world's largest brokerage. Formerly known as Merrill Lynch & Co., Inc., prior to 2009 the firm was publicly owned and traded on the New York...
, a United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
-based financial services
Financial services
Financial services refer to services provided by the finance industry. The finance industry encompasses a broad range of organizations that deal with the management of money. Among these organizations are credit unions, banks, credit card companies, insurance companies, consumer finance companies,...
firm.
According to Maeil Business Daily (March 2, 2009), one of leading business publications in South Korea, the investment losses have been mounting. The Merrill purchase has yielded as much as 80% negative return as of February 25, 2009. Moreover, with limited prospect of getting additional funding due to the controversy at home, the fund does not seem to have much investable cash left in its coffer.