"Why Didn't You Sell Stocks?" Returns Plummet... Clash Over National Pension

[Anchor]

During the National Assembly audit of the National Pension Service today (October 14), a clash broke out over the NPS increasing its proportion of domestic stocks while the stock market was surging. The opposition party fiercely criticized that it only created opportunities for foreign investors to realize profits, while the NPS countered that this is merely a retrospective interpretation.

[Reporter] Han Sung-hee reports.

[Reporter]

The fund operation return recently released by the National Pension Service stands at 14.84% as of the end of July.

This is a drop of more than 12 percentage points in just one month compared to 27.22% at the end of June.

The main reason was that as the domestic stock market declined, the return on domestic stocks fell from 107.37% at the end of June to 60.11% at the end of July.

The closing price of the KOSPI at the end of July was higher than today's closing price, which barely defended the 6,000-point mark in the 6,500 range.

Therefore, current returns may have fallen further.

At the National Pension Service audit, the opposition party took issue with the fact that back in January, even when the proportion of domestic stocks already exceeded the target, the NPS did not sell them—meaning it did not conduct "rebalancing"—and instead actually increased the proportion of domestic stocks in May.

They argued that the NPS should have cashed out stocks to secure more funds for the public's retirement, but instead fueled an abnormal stock price surge, giving only foreigners an opportunity to sell at the peak.

[Lee Dal-hee / People Power Party Lawmaker: The damage fell squarely on individual retail investors who went all in, trusting the government's stock market support policy, and overseas, there is even a nickname saying, "South Korea's National Pension is our ATM machine"...]

[Kim Sung-joo / Chairman of the National Pension Service: If we had not suspended rebalancing, we probably would have had to sell about 800 billion won a day, causing a severe shock to the market...]

A debate also unfolded over whether the NPS was mobilized to support the administration's stock market boost ahead of the local elections in June.

[Kim Tae-ho / People Power Party Lawmaker: (We demand) a parliamentary investigation regarding suspicions of instrumentalizing the public's retirement funds for political purposes, the suspension of NPS rebalancing, and the expansion of the domestic stock proportion.]

[Kim Sung-joo / Chairman of the National Pension Service: I have never experienced a situation where government orders passed through (the Fund Management Committee) as they were. If we return to the situation of the Korean stock market at that time, there was no disagreement (on suspending rebalancing).]

The People Power Party pressed for the disclosure of the minutes from the time when rebalancing was suspended and the domestic stock proportion was increased, but the Democratic Party and the NPS countered that, according to the National Pension Act, disclosure is scheduled for four years later in principle.

(Photo: Yonhap News) (Reported by Shin Dong-hwan | Video by Oh Young-taek | Graphics by Kim Ye-ji)
※ Please note: This article was translated by AI and may contain errors.