Amid fears of worsening business performances of securities companies coupled with declining transaction money, caused by the sagging stock market, Mirae Asset Securities posted 605.9 billion won in the first half of this year on a consolidated basis.
Mirae Asset Securities saw Q2 operating profit plunge 26 percent year-on-year to 321.3 billion won, but the figure was 24.4 percent more than market consensus set at 258.1 billion won.
The securities firm logged 354.2 billion won in Q2 net income before tax and 626.8 billion won in H1 net income before tax.
Mirae Asset Securities explained that the securities firm achieved a good business performance based on countermeasures it took against losses in the trading business.
It did that through preemptive market responses and diversified investment portfolios.
Mirae Asset Securities posted 110 billion won in operating profit and logged 75.6 billion won in real distribution money accruing from assets for investments and dividends.
Mirae Asset Securities HK Limited Sees Capital Reduction Worth 335.4 Billion won
Mirae Asset Securities HK Limited, a subsidiary, wholly owned by Mirae Asset Securities, conducted a capital reduction of $250 million (335.4 billion won).
The money was brought to Korea, but Mirae Asset Securities maintains expectations toward the Chinese market.
The securities firm plans to expand the flexibility of capital corresponding to the market situation.
In an electronic filing submitted to the Financial Supervisory Commission on Aug. 29, Mirae Asset Securities HK Limited had a meeting of the board of directors on Aug. 25 and decided to reduce capital.
Capital reduction refers to reducing capital by incinerating stocks in return for compensating shareholders. Shareholders receive cash in compensations like dividends.
According to a plan on the capital reduction, Mirae Asset Securities HK Limited will burn 2.17 billion shares or 13.9 percent of the 14.497 billion shared issued.
In return, Mirae Asset Securities will receive $250 million (335.4 billion won) in compensations. With the capital reduction, the operation in Hong Kong sees the number of shares issued reduce from 14.497 billion to 12.48 billion and capital plunge from 2,075.8 billion won to 1,787 billion won.
Mirae Asset Securities said the capital reduction realigns capital for the purpose of raising mid- and long-term outcomes of the global business and efficient operation of capital.
In reality, Mirae Asset Securities has been expanding the venture capital and exchange-traded fund (ETF) business.
The capital reduction of the operation in Hong Kong is analyzed to be linked to capital utilization in consideration of foreign currency exchanges.
Mirae Asset Securities has so far increased investments by setting Hong Kong as global center to explore global financial markets.
The securities firm saw the operation in Hong Kong raise its capital to 850 billion won and 360 billion won in 2019 and 2020, respectively.
A Mirae Asset Securities official said the operation in Hong Kong has stabilized its own capability to raise funds, and with the capital reduction, the subsidiary will continue to be a business center through balanced profit portfolio, the official said.
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