Could you provide a brief journey of how you arrived where you are today?
I have worked for Korea Investment and Securities (KIS) for 15 years, mainly in investment banking. These include being the head of international finance, mergers and acquisitions, mezzanine investment and equity capital market.
KIS set up an Islamic finance team in early 2008. Since then I was heading the team and responsible for the firm’s overseas business developments. One reason that we established an Islamic finance team is to diversify the foreign currency source of funding for Korean issuers. Another reason is to seek for business opportunities from emerging Islamic economies including Malaysia and the GCC.
What does your role involve?
I monitor and research the emerging countries mainly in Asia. Upon feasibility studies, I develop cross border business opportunities between Korea and the region. I also select the countries that KIS needs to expedite its own securities businesses. Besides Malaysia and the GCC, China, Indonesia, Vietnam also attract KIS’ interest in the operation of its own securities house.
KIS’ role is also to introduce the concept of Islamic finance to the Korean financial market, especially in investment banking. We have broadened our relationship with Islamic securities industry pundits, including Islamic banks, fund managers and advisors, in Malaysia and the GCC. We have also been tapping and educating potential Korean issuers to consider issuing Sukuk.
What is your greatest achievement to date?
In relation to Korean issuers’ securities offerings, the dual listing of LG display into New York Stock Exchange (NYSE) and Korea Exchange (KRX) in 2004 is the most notable one. The transaction set up opened a new capital raising practice for the benefit of Korean issuers through the reconciliation of numerous different regulatory hurdles and market practices between the US and Korea.
We helped the Korean government draft a new tax regulation in which the exemption of issuers’ taxes incurring from the transfer of assets for Sukuk issuance is included. Having the only Islamic finance team in Korea and its own external Shariah advisor, KIS’ strategic commitment to Islamic finance has been unique to the market and quite adaptive to help government initiatives. Although the law has not been passed by parliament, I think the preparation of a new tax regulation can have a meaning to the Korean capital market.
Which of your products / services deliver the best results?
The products and services related to Islamic finance have not yet emerged in Korea. Referring to the preparatory works, the potential issuers were interested in actual market feedback conveying Islamic investors’ concrete needs. Apart from the strategic need for the diversification of funding sources, issuers are quite concerned and eager to be informed about pricing terms when they issue Sukuk. We made frequent trips to Malaysia and the GCC region and updated potential issuers with the timed feedbacks from the investors, such as, their appetites for Korean debt securities, overall perception about Korea and the liquidity situation in the Islamic financial world.
What are the strengths of your business?
KIS’ investment banking capability tops in many areas. It has been the biggest IPO house for 2010. Leading in various fields such as debt underwriting, derivative product sales, research, KIS has received numerous best Islamic banking awards.
KIS also has a sister company named KIMC, one of the largest asset management houses in Korea which manages all three of the biggest equity funds in Korea. KIS has taken advantage of this strong investment banking and asset management background.
What are the factors contributing to the success of your company?
KIS’ well disciplined risk management practices have enabled KIS to overcome a number of financial crises and grow as one of the biggest investment banks in Korea. We are not affiliated with big conglomerates or commercial banking groups and being independent, we are more thorough and acute in our risk management.
What are the obstacles faced in running your business today?
Obviously, it is the delay in the amendment of new tax law which will surely allow Korean issuers tap the Islamic financial market. It is only after the amendment of the law, that Islamic finance in Korea can move forward.
Where do you see the Islamic finance industry in, say, the next five years or so?
It will surely maintain its high growth tendency. Demographic potential and the growth of middle income classes in the Muslim countries will boost the growth of Islamic finance.
Name one thing you would like to see change in the world of Islamic finance.
To be a globally competitive industry, Islamic finance should not only appeal to Muslims but also non-Muslims. I would like to see Islamic finance being applied globally .