NH Investment & Securities Raises 400 Billion Won in Capital to Drive Future Growth
Third-Party Paid-In Capital Increase Allocated to NongHyup Financial Group
On June 3, NH Investment & Securities announced that it has decided to carry out a third-party paid-in capital increase totaling 400 billion won, with NH NongHyup Financial Group, its largest shareholder, as the target.
The company explained that this capital increase aims to quickly and stably establish a capital environment so that its core new business, the Integrated Managed Account (IMA), and related corporate finance and venture capital investments can enter a full-fledged growth trajectory.
It further added that this decision by NH NongHyup Financial Group reflects the financial holding company's commitment to supporting the overall growth of the securities industry and enabling NH Investment & Securities to make rapid progress, thereby continuously enhancing shareholder value.
The IMA business requires much stronger capital adequacy and financial soundness compared to existing businesses. This is because NH Investment & Securities, as the operator, must not only invest client funds in corporate finance and venture capital but also ensure stable repayment capacity exceeding the principal. In this regard, as of the first quarter, the company's net capital ratio for business stood at 159.3%, which is lower than that of major competitors. The company emphasized that it plans to swiftly strengthen its IMA business capabilities and secure the trust of clients and the market through this prompt capital support from the holding company.
A portion of the raised funds will also be used to expand the limit for retail credit extensions. Although demand for credit extensions from investors has been rapidly increasing due to the recent activation of the stock market, timely response has been difficult due to limits linked to equity capital. With this capital increase, the company also intends to strengthen related service capabilities.
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Byungwoon Yoon, CEO of NH Investment & Securities, stated, "This paid-in capital increase is a strategic decision not only for short-term capital expansion but also to secure competitiveness in future growth businesses," adding, "We will make every effort to use the secured capital efficiently to enhance profitability and corporate value, ultimately leading to increased shareholder value."
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