The latest offering raised 519.8 billion won ($387.5 million), or 86.6 percent of its 600 billion won target, over 10 trading days from Sept. 30 to Oct. 15, the FSC said.
The first offering in May was fully subscribed within six trading days. The benchmark KOSPI had been gliding toward 8,000 when the fund launched on May 22. By Thursday, the main index had fallen nearly 30 percent from that level to 5,554.22.
The market’s decline was especially pronounced on the final day of subscriptions, when the KOSPI plunged 7.57 percent to a six-month low. The junior KOSDAQ index fell 7.65 percent to 760.82.
The latest round attracted just 44 billion won on its final day, leaving 80.2 billion won of the target unraised.
Brokerages accounted for 66 percent of sales, compared with 34 percent through banks. Lower-income investors, defined as those with annual employment income of 50 million won or less, accounted for 26.5 percent of sales. Their share stood at 28.6 percent at banks and 25.4 percent at brokerages.
Despite the overall shortfall, several major brokerages sold out their initially allocated shares before the subscription deadline. They included Mirae Asset Securities, Samsung Securities, Korea Investment & Securities and Kiwoom Securities, as well as NH Investment & Securities and KB Securities.
As sales through banks lagged, a total of 146.9 billion won was reallocated from banks to brokerages in two rounds.
SeInitially, banks had been assigned 339 billion won of the offering, compared with 261 billion won for securities firms.
The adjustments drew criticism that financial authorities were pressuring securities companies to sell the remaining shares of the offering.
In response, the FSC said in a statement Thursday that the reallocations were made by the three fund managers based on sales performance and demand among the 24 participating distributors.
"The FSC has never instructed securities firms to 'sell quickly,'" the regulator said, rejecting claims that the transfers amounted to forcing unsold allocations onto brokerages.
It also said the second offering was intended for investors who missed the first round in May.
"It is inappropriate to compare the sales rates and pace of the first and second funds on the same basis," the FSC said.
The commission added that a measured pace of sales was preferable for a high-risk investment product that does not allow early redemptions.
The retail investment fund is part of the country’s broader National Growth Fund initiative, which channels public and private capital into strategic industries, including artificial intelligence (AI), semiconductors and biotechnology.
Eligible investors can deduct up to 40 percent of their investment from taxable income, depending on the amount invested, and pay a preferential 9.9 percent tax on dividend income, including local taxes.
The five-year fund does not allow early redemptions. To cushion potential losses, government-backed capital and other subordinated investments are structured to absorb the first 18.8 to 23.3 percent of losses, although investors could still lose part or all of their principal.
Following the end of subscriptions, three master funds were scheduled to be established Friday. Investments through 10 sub-funds were set to begin on Oct. 19.
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