이 기사는 2021년 08월 19일 08:01 thebell 에 표출된 기사입니다.

DGB Financial Group’s acquisition of Newsystock is in line with the group chairman Kim Tae-oh’s longer-term business plan to strengthen its foothold in the domestic capital market.

Newsystock is South Korea’s first robo adviser-powered investment service provider, targeting the MZ generation, which encompasses millennials and Generation Z.

DGB Financial has completed its payment on August 13 and made Newsystock its 10th subsidiary. The financial group also benefited from temporary lift of regulations that forbid fintech firms from becoming subsidiaries of financial holding companies.

Newsystock is a platform-based fintech startup that allows customers to create their own algorithms to manage investment assets. Investors receive commissions by selling algorithms or transferring know-hows and Newsystock makes profits by taking a portion of the commissions for this process.

Through the latest acquisition, DGB Financial has entered into the new sector of the capital market. Kim vowed to make the group one of the major players in the capital market when he revealed goals for his extended term last year.

Newsystock is reportedly the only artificial intelligence-based investment firm that operates in the black. The fintech firm swung to a profit for the first time in 2020, delivering 1 billion won ($855,000) in net profits. DGB Financial expects the company’s net profit to double this year compared to that of 2020.

Newsystock is likely to create synergies with DGB Financial’s existing affiliates including Hi Investment & Securities. The acquisition may be an opportunity for the brokerage firm to supplement its weakness like retail business.

The group’s wealth management business is also expected to make progress by linking robo-advisor based on Newsystock’s technology.

“We have put efforts into the acquisition, hoping to create synergies, and plan to develop new things through the post-merger integration process,” said an official at DGB Financial. “The fact that (Newsystock) is a platform company also fits the group's strategy, which emphasizes digital transformation.” (Reporting by Hyun-jung Kim)