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June 17, 2026Tax overhaul and a formal family office framework urged to shift Korea from PB services to long-term, institutional wealth management
There are many rich people in Korea. But for asset holders to properly run a family office (Family Office, FO), today’s investment culture and regulatory environment are far from sufficient. Tax reform, financial education, and an overhaul of overall market structure must proceed in parallel.
Kijung Kwon, Managing Director of NH Absolute Return Partners (NH ARP), defined the essence of a family office as a “long-term strategy tailored to the asset holder’s standards” and stressed this point. NH ARP, the Singapore subsidiary of NH Investment & Securities, is an alternative asset specialist manager.
Active on the front lines of Singapore finance since 2009, Kwon joined NH in 2020 after stints at a U.K.-based investment bank (IB). Having long worked with global investors such as hedge funds and family offices, Kwon is regarded as a local expert with a deep grasp of the flow of Singapore’s capital market.
Kwon said, “In Korea, many people who reach a certain level of assets use private banking (PB) services, but once assets exceed 100 billion won, simple PB is not enough,” adding, “You need to move to the family office stage, where strategic asset allocation and risk management are necessary.”
At present, domestic asset holders tend to rely on “FO services” offered by banks or securities firms rather than setting up their own family offices. On this, Kwon said, “The essence of a family office is that an asset holder establishes a separate corporation, transfers assets, and operates independently,” adding, “Korea still remains at a PB-centered wealth management level, and in terms of the overall market, it is only at a crawling stage.”
Institutional gaps are also an obstacle. Korea currently has no separate rules defining a family office, and they are run by borrowing the framework of a general investment corporation or consulting firm. Family office services operated by financial companies are likewise provided individually under each firm’s internal standards without institutional guidelines.
The beginning of domestic family offices is considered to be Atinum Partners, established by Chair Lee Min-joo, who sold the cable TV operator C&M in 2008. The goal was to systematically manage the sale proceeds, which amounted to 1.5 trillion won at the time. But nearly 20 years later, new establishments following Atinum remain extremely rare.
The biggest barrier is a punitive tax structure. Under the current domestic framework, running a family office results in double taxation—corporate tax and dividend income tax—on asset management revenue, increasing the tax burden. There is little incentive for an asset holder to spend massive expense to set up a family office directly.
Kwon said it is necessary to bring family offices with assets above a certain scale into the formal system, and to refine the qualified investor regime along with tax incentives. If such policy support proceeds in parallel, family offices can contribute to qualitative growth across the financial industry beyond serving merely as a wealth management tool.
Kwon said, “As more family offices emerge, asset managers and securities firms will roll out higher-quality financial products to match, and the number of high-quality financial products can ultimately increase.”
As an asset manager, NH ARP focuses on alternative investments centered on private equity and private debt. By the nature of these investments, it has many points of contact with various family offices.
Having watched countless asset holders up close, Kwon cited “financial IQ” as the key factor determining the success or failure of family office investing. He said, “In Singapore, asset holders have a very high understanding of the structures and risks of various investment products,” adding, “For example, when we introduce a private debt fund that lends to U.S. small and midsize companies, Singapore asset holders often look first at default rates or sector risks rather than returns, whereas most Korean asset holders focus on returns.”
He also pointed out that it is necessary to improve the tendency toward short-term performance-focused investing. Kwon recalled, “The Korean market is still fixated only on short-term products. When I once tried to introduce an 11-year U.S. fund domestically, I remember being surprised that the market viewed three years as the absolute limit.” He warned, “An investing pattern that chases only short-term performance becomes a fatal risk that can wipe out the entire asset base when a downturn hits.”
He added that financial companies also need to work to screen for good financial products.
Kwon said, “The product sets available to high-net-worth asset holders and family offices in Korea and Singapore differ. Of course, large institutions such as Korea’s pension funds can access good investment products, but because ordinary financial companies lack experience with overseas products, related products often get blocked at the internal approval stage.”
Finally, Kwon again stressed that family offices will become a key pillar driving structural reform in Korea’s financial industry. He said, “The more demanding family offices become in their standards, the more financial firms will supply products with responsibility and expertise to match,” adding, “This can lead to advances across the financial industry, including wealth management (WM) and PB.”