Hanwha Life Insurance is on the verge of finalizing its acquisition of a 75% stake in Velocity Clearing, LLC, marking a significant expansion into the US financial services market. The Korean insurer received critical approvals from South Korea’s Financial Services Commission earlier this month and recently secured clearance from the US federal government’s Committee on Foreign Investment (CFIUS).
The transaction, which originated with a stock purchase agreement signed last November, could be completed as early as May, according to industry sources. For Hanwha Life, the acquisition represents a strategic pivot toward diversifying its investment portfolio as it navigates challenging domestic conditions.
New York-based Velocity Clearing, established in 2003, specializes in IT-based services for institutional investors including clearing, settlement, and prime brokerage. The firm has demonstrated robust growth recently, with total assets growing from $787 million to $1.22 billion last year.
The expansion comes as Hanwha Life faces financial challenges at home. Despite reporting an 866 billion won ($649 million) net profit last year—a 5% increase—the company issued no dividends due to increasing policy surrender reserves. The insurer’s capital solvency ratio stood at 73.8%, making it the only major Korean life insurer with a ratio below 100%.
Hanwha Life has experience with international ventures, having established South Korea’s first wholly-owned insurance subsidiary in Vietnam in 2008. That operation recorded its first cumulative surplus last year, distributing a 5.4 billion won cash dividend.
