PEF Association Nears Launch—Who Will Become Its First Chair? 'All Eyes on the Race' [fn Market Watch]

[Financial News]  The launch of the PEF Association, an incorporated body representing South Korea's private equity fund (PEF) industry, is drawing near. Lim Yoo-chul, CEO of H&Q Korea, is reportedly the leading candidate to become the association's first chair. As calls for tighter PEF regulation have intensified following the Homeplus incident, the industry's channel for government affairs and policy responses is also expected to become permanent.
According to investment banking (IB) industry sources on the 1st, the PEF Managers Council is negotiating articles of incorporation with financial authorities and a law firm to establish an incorporated association. At a general meeting on the 28th, it plans to explain the establishment proposal to member firms, secure their approval, and apply to the Financial Services Commission (FSC) for authorization. The association is expected to officially launch in 2027.
The PEF industry's attention is focused on the selection of its first chair. Under the existing system, representatives of executive committee member firms have taken turns serving as chair. Park Byung-keun, CEO of Daishin Private Equity, will complete his term next month. Under the rotation system, Hyun Seung-yoon, CEO of Stonebridge Capital, would be next in line.
However, the industry is considering appointing a founding chair separately from the existing rotation system as the council transitions into an incorporated association. Song In-jun, vice chairman of IMM Holdings; Kwak Dong-gul, vice chairman of STIC Investments; and Lim Yoo-chul, CEO of H&Q Korea, have been mentioned as candidates. Reports indicate that support currently leans toward Lim. Procedures including consultations with member firms remain before the final appointment is made.
Lim is a first-generation investment professional who has worked in the industry since the early days of South Korea's PEF market. He also served as the immediate past chair of the PEF Managers Council, and is regarded as having strengths in mediating differing interests among member firms and communicating with financial authorities.
The association's launch comes amid changes in the regulatory environment surrounding PEFs. The National Assembly has introduced a series of bills to lower borrowing limits for institution-only PEFs and strengthen requirements for operational and business reports as well as accounting audits. The Financial Supervisory Service has also developed standard internal-control criteria in consultation with the PEF Managers Council.
Until now, the PEF Managers Council had operated as a voluntary organization with approximately 90 member firms, without a separate legal entity. If it becomes an incorporated association, it is expected to play a larger role as an official channel representing the interests of the PEF industry and communicating with financial authorities and the National Assembly, going beyond its function as a simple consultative body. Some in the industry, however, are concerned that the association could become a channel for the authorities' ongoing management and supervision. An IB industry official said, "As regulations and institutional changes concerning PEFs have accelerated, the need for an industry-wide response rather than action by individual management firms has grown. The founding chair will need the experience and external communication skills to coordinate the interests of member firms while dealing with regulators and the National Assembly," and emphasized the point. 

[email protected] Kim Kyung-ah and Kang Gu-gwi Reporter