JPMorgan cuts Kiwoom Securities stake for W26.1b

JPMorgan Asset Management has reduced its stake in South Korean securities brokerage house Kiwoom Securities to cash out 26.1 billion won ($22.9 million), in an apparent profit-making move, a filing showed Tuesday.

Since August, Hong Kong-based JPMorgan Asset Management Asia Pacific and five affiliated parties had unloaded a combined 1.11 percent stake in the Seoul-based brokerage house without a brick-and-mortar branches. The transaction cut JPMorgan’s stock holding to 3.9 percent, steering clear of JPMorgan‘s disclosure requirement as a Kiwoom Securities minority shareholder.

This comes nearly a year after JPMorgan first emerged as a Kiwoom’s minority shareholder with disclosure obligation, by holding over 5 percent of Kiwoom shares in December 2019. The asset management firm increased its stake to as high as 6.05 percent as of May 2020.

The company has started selling off Kiwoon shares in May 2020.

Meanwhile, Kiwoom Securities‘ stock price rebounded from the coronavirus fallout and soared onward until September as the high market liquidity boosted retail investor engagement in the stock market, translating into a higher revenue for the brokerage primarily targeting retail investors.

Kiwoom Securities’ revenue jumped threefold on-year in the first half, while its operating profit surged over 20 percent. Since December, the share price of Kiwoom has grown over 25 percent.

By Son Ji-hyoung (consnow@heraldcorp.com)