Stepping Up Overseas Expansion

Daewoo Securities eyes Latin America, Middle East and Central Asia to expand global operation

Daewoo Securities Co. has been working to expand overseas ever since the arrival of President Kim Sung-tae this year, knowing that growth prospects for the local stock brokerage business is limited.
The company has been focusing on building up its investment banking division now that competition in the financial industry will be unconstrained with the enforcement of the Capital Markets Consolidation Act set to come into effect in 2009. Daewoo Securities has been particularly keen on expanding its overseas business network, a necessary step toward becoming a global securities firm.
In June, the company signed a strategic tie-up with the Bao Viet Securities Co., a top securities firm in Vietnam, for bilateral cooperation in such wide-ranging areas as consultation for the privatization of Vietnam's state-run companies and investment in those companies as well as listing them in overseas stock markets.
Daewoo expects four or five state-run firms to be privatized, possibly within this year, and is ready to provide them with consulting services.
The company plans to send personnel to Vietnam this year to study the situation in Vietnam's financial market, especially in the research and IB sectors. The company will also train Vietnamese professionals in Korea in the securities and IB markets.
In July, Daewoo Securities took over a 19.9 percent stake in Etrading Securities Co. in Indonesia, becoming the second largest shareholder. The company dispatched its personnel to the Indonesian securities firm in September to supervise Daewoo's private investments in Indonesian firms and to teach investment banking know-how. The company is also in talks with Etrading on making direct investment in corporate financial products issued by the firm.
Daewoo Securities is preparing for the issuance of private equity funds invested in the Indonesian financial market in cooperation with KDB Capital. If it pays off, the company will sell the funds to individual investors in Korea.
The company has made inroads in Latin America, too, following its advance into Southeast Asia. In August, the company signed an MOU with Itau Financial Group of Brazil. President Kim signed the agreement for Daewoo and President Roberto Nishigawa for the Brazilian company at the Daewoo Securities office in Seoul. This was the first business tie-up with a Latin American company for Daewoo Securities, paving the way for its advancement into the region. The agreement provides for the two companies to cooperate in such areas as consultations for the development of financial products, and to make joint investments and provide mutually exclusive services. Daewoo will also get advice from the Brazilian company on investing in local companies, bonds and debentures. The company is also engaged in the development of derivative products based on local stock indices and interest rates.
Daewoo Securities plans to invest $10 million in Brazilian firms to be listed on the Brazilian stock exchange. The Korea Development Bank, in cooperation with its Brazilian subsidiary will look into investing in real estate, social infrastructure projects and turning them into financial products.
Daewoo Securities officials said they have been studying ways to advance into the countries of Central Asia and the Middle East by building a business network in those regions in the near future.
Daewoo Securities Co. was set up in September 1970 as Dongyang Securities Co. and changed its name when it was taken over by the Daewoo Group several years later.
The company now has 116 domestic branches and three overseas subsidiaries and one office.
The company is proud of its 37 years of operation and its contribution to the growth of the financial industry in Korea. The company said its role would expand to that of a pioneer in financial services and a leading global securities firm, advancing the development of Korea's capital market. It is poised to open a new era of financial service based on its cutting-edge competitiveness recognized by the financial service industry. The company said it will create and lead a market where the highest profits are made through trust and principles.
the company that attracts customers, a company that sets new standards in financial services, a company that paves the way for development in the Korean financial industry, that is Daewoo Securities,the company said in a brochure.
It will spread our wings to deliver greater satisfaction to our customers and shareholders,it added. nw

Pres. Kim Sung-tae of Daewoo Securities Co.