South Korea's Financial Services Commission launched the selection process for sub-fund managers for the second National Growth Fund on the 6th, following the early sellout of the first fund released in May. The second fund will be established with a scale of 600 billion won, plus a separate 120 billion won in government subordinated capital. The initiative aims to channel public investment into strategic industries including semiconductors, secondary batteries, artificial intelligence, and defense sectors through a structured investment framework.
FSC Maintains Existing Fund Structure for Second National Growth Fund
The Financial Services Commission announced that the fiscal mother fund manager and public fund manager will remain unchanged from the first fund to ensure swift launch. Only the sub-fund managers, who handle the actual investment of public capital, will be newly selected. The 10 sub-fund managers selected for the first fund are eligible to reapply, but must submit detailed operational plans addressing additional fund formation capacity, first fund operational status, and conflict-of-interest prevention systems between the first and second funds.
Sub-Fund Managers Face 60% Strategic Industry Investment Requirement
The selection criteria remain identical to the first fund. Individual sub-funds must invest at least 60% of their capital in companies related to 12 strategic high-tech industries, including semiconductors, secondary batteries, artificial intelligence, and defense. At least 30% must be allocated to unlisted companies and KOSDAQ technology special-listing companies through new capital supply methods such as paid-in capital increases and mezzanine financing. The remaining 40% allows discretionary investment by fund managers.
Sub-fund sizes are differentiated into small (400 billion won or more, 4 or more companies), medium (within 800 billion won, around 4 companies), and large (within 1,200 billion won, within 2 companies), considering past track records. The FSC plans to select around 10 sub-fund managers, similar to the first fund. Subordinated investment by sub-fund managers is mandatory to ensure responsible management, and screening of internal compensation and management systems for key operational personnel will be strengthened.
Selection Process Proceeds Through August with Q3 2026 Launch Target
Financial authorities plan to proceed with the sub-fund manager selection process starting with the recruitment announcement on the 6th, followed by proposal submissions by the 20th, and evaluation and selection in August. Considering this schedule, the second National Growth Fund is scheduled to launch during Q3 2026.
Sales Structure to Incorporate First Fund Performance Feedback
Sales-related matters, including priority allocation for ordinary citizens and online sales ratios, will be improved after gathering opinions from distributors such as banks and securities firms based on the first fund's sales performance.
FAQ
What is the total size of South Korea's second National Growth Fund?
The second National Growth Fund will be established with 600 billion won, plus a separate 120 billion won in government subordinated capital, as announced by the Financial Services Commission on the 6th.
What are the investment requirements for sub-fund managers in the second National Growth Fund?
Sub-fund managers must invest at least 60% of their capital in companies related to 12 strategic high-tech industries including semiconductors, secondary batteries, AI, and defense. At least 30% must go to unlisted companies and KOSDAQ technology special-listing companies through new capital supply methods, with the remaining 40% allowing discretionary investment.
When will the second National Growth Fund launch?
The second National Growth Fund is scheduled to launch during Q3 2026, following the selection process that includes proposal submissions by the 20th and evaluation and selection in August.
