Securities Firms Outpace Insurers and Regional Banks in Assets and Profits

Securities firms in South Korea are rapidly expanding their scale and profitability, moving past insurance companies and regional banks. This shift is largely driven by their aggressive growth in comprehensive financial investment services, such as venture capital and corporate finance, since 2021. The trend is evident in asset size, with major securities groups like Mirae Asset Securities Group surpassing insurance giants like Hanwha and Kyobo. Meritz and Korea Investment & Securities have also significantly outpaced regional banks like iM Bank.

Analysis of major financial groups reveals a dramatic change in the competitive landscape. By the end of 2025, Mirae Asset Securities Group is projected to have assets of 189 trillion won, exceeding Hanwha's 179 trillion won and Kyobo's 148 trillion won. Meritz and Korea Investment & Securities, with assets around 135-136 trillion won, have also surpassed iM Bank's 99 trillion won. This contrasts sharply with the situation in late 2021, when Hanwha Life Insurance Group led in assets, followed by Mirae Asset and Kyobo, with Meritz and Korea Investment trailing behind regional banks.

In terms of profitability and growth over the past three years, securities groups have also outperformed regional banks and insurance companies. For 2025, net profits for Mirae Asset, Meritz, and Korea Investment are projected to significantly exceed those of regional banks like BNK, iM, and JB Financial, as well as Hanwha and Kyobo. Their return on assets (ROA) is also considerably higher than that of insurance firms and regional banks. This performance surge is linked to regulatory changes since 2021 that expanded the business scope of comprehensive financial investment service providers, combined with a recent stock market rally.

Favorable regulatory environments have allowed large securities firms to secure licenses for issuing commercial paper and operating comprehensive investment accounts. Over 25% of these funds are mandated for investment in venture capital, fueling continued growth in corporate finance. However, this expansion comes with increased risk. Securities groups typically invest over 50% of their assets in securities like stocks and bonds, and 10-25% in loans. This makes them more exposed to market volatility compared to banks, which maintain a higher proportion of assets in loans.

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The expansion of the business scope through changes in the comprehensive financial investment system since 2021 has been a significant factor. The impact of the stock price increase only appeared after last year.