South Korea’s top securities firm Mirae Asset Daewoo Co. has launched its prime brokerage service in the United States, becoming the first Korean financial player to advance into the world’s largest prime brokerage market dominated by global investment banking giants.

Mirae Asset Daewoo said on Wednesday that its New York entity that received license to run prime brokerage business in the U.S. in January has recently started to offer the prime brokering services in the country. The securities firm’s New York office will provide its clients with a comprehensive prime brokerage services ranging from repurchase agreement brokering to securities lending and settlement services.

Having launching the first Korean prime brokerage services in the U.S., Mirae Asset Daewoo has thrown down the gauntlet to global IB giants. In the U.S., prime brokerage services, which refer to a group of exclusive and comprehensive brokerage services for hedge funds and large institutions, have been dominantly offered by large IBs such as Goldman Sachs and Morgan Stanley.

Mirae Asset Daewoo is known to have been going all out to make a foray into the U.S. prime brokerage market since Mirae Asset Securities last year acquired KDB Daewoo Securities which was rebranded to Mirae Asset Daewoo. Park Hyeon-joo, chairman and founder of Mirae Asset Financial Group, is said to have shown a strong will to advance into the U.S. market targeting hedge funds with its new brokerage unit.

Mirae Asset Daewoo’s U.S. entity in New York has already signed contracts with about 100 institutions including global hedge funds, banks and securities firms to offer them its prime brokerage services. Its main clients will be the U.S. hedge funds that are actively seeking investment opportunities in emerging markets. One of its new clients is reported to be a global hedge fund with $14 billion assets under management.

By targeting the industry’s niche market, Mirae Asset Daewoo hopes to gain a competitive edge over its bigger rivals in the U.S., which is home to the world’s largest hedge fund industry, unlike the relatively small, 10 trillion won ($8.91 billion) worth prime brokerage market in Korea.

Last year, Mirae Asset Daewoo issued new shares worth $250 million to boost capital of its U.S. corporate in New York.

By Shin Heon-cheol

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