- Background

o To this date, the poor availability of price information acted as an impediment to secondary market activity of bonds. The introduction of a mark-to-marketing system for bonds will improve the current situation considerably. Furthermore, the introduction of mark-to-marketing principles is essential in terms of bringing bond valuation practices up to international standards and to induce foreign investment.
- Scope of bonds to be effected

o 1st stage : bonds that are held in funds newly established after November 15, 1998

o 2nd stage : to be fully implemented starting from July 1, 2000
- Expected Outcome

o A fully developed bond market will provoke the establishment of mutual funds

o Funds managed by investment trust companies and banks will be recognized as a means of investment involving risk and return

o Problems encountered due to asset valuation based on book value of bonds when transferring gains/losses of fund assets or gain/losses of fund assets and proprietary assets will be resolved
- Future Plans

o Necessary amendments to the Securities Investment Trust Regulations will be presented at the FSC meeting on November 13, 1998

* Please refer to the attached file for details.