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Dec 16, 2024
- Financial Authorities of Korea and Japan Hold 8th Shuttle Meeting
- The Financial Services Commission and the Financial Supervisory Service announced that the 8thKorea-Japan shuttle meeting of financial authorities of Korea and Japan is held on December 16-17 in Tokyo, Japan. Joint Press Release of the Eighth Korea-Japan Shuttle Meeting of Financial Services Commission and Financial Supervisory Service of the Republic of Korea and Financial Services Agency of Japan (Tokyo, Japan, September 16, 2024) 1. The Eighth Japan-Korea Shuttle Meeting was held by the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) of the Republic of Korea and the Financial Services Agency (FSA) of Japan in Tokyo, Japan, on December 16. 2. At the Shuttle Meeting, Mr. LEE Bokhyun, Governor of the FSS of the Republic of Korea and Mr. ITO Hideki, Commissioner of the FSA of Japan exchanged views on the global economic and financial situation and its impact on Korean and Japanese financial institutions. They also exchanged views on the recent developments in their respective markets. 3. Commissioner Ito welcomed Governor Lees visit to Japan, recognizing the importance of maintaining timely and close communication between the financial authorities of Japan and Korea for the stability of the financial market in the East Asian region. 4. Governor Lee reaffirmed the importance of both countries cooperation and coordination in enhancing financial stability in the region, introducing the Korean authorities measures to stabilize the financial markets in the wake of the recent market fluctuations, as well as their next steps to address them going forward. 5. In view of the coming 60th anniversary of the normalization of relations between the Republic of Korea and Japan in 2025, they reaffirmed that the authorities of both countries will continue to work together to respond effectively to common opportunities and challenges in the financial sector, anticipating that this shuttle meeting will continue to provide an important platform for this e
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Dec 12, 2024
- Authorities Introduce Administrative Guidelines on Green Finance for Application on K-taxonomy
- The Financial Services Commission, the Ministry of Environment, and the Financial Supervisory Service announced on December 12 the establishment of administrative guidelines on green finance for application on the green economic activities specified by K-taxonomy. In 2021, the Ministry of Environment established K-taxonomy to provide clear standards on eco-friendly and green economic activities, and in 2022, the Financial Services Commission and the environment ministry introduced the guidelines on green bonds to facilitate the application of K-taxonomy in the financial sector. In this regard, the administrative guidelines on green finance being introduced today provide specific criteria for determining the appropriateness of financing green economic activities for financial companies, thereby creating conditions to promote green financing. In preparing for the administrative guidelines, financial authorities examined overseas cases, sought consultations from experts, collected opinions from taskforce meetings on climate finance, and conducted pilot tests. The administrative guidelines contain specific criteria for determining green economic activities when financial companies provide green finance to businesses, and address issues regarding the prevention of greenwashing and internal control of financial companies. Key details of the administrative guidelines are as follows. First, a clear definition on green finance has been established. Under the administrative guidelines, green finance refers to the financing of an economic activity that meets the standards specified by K-taxonomy with appropriate internal control procedures. This clarification will help to resolve uncertainties regarding greenwashing for financial companies and encourage them to more actively provide green finance. Second, internal control standards have been established for financial companies regarding their handling of green finance related works, detailing who should be in charge of determi
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Dec 11, 2024
- Household Loans, November 2024
- In November 2024, the outstanding balance of household loans across all financial sectors rose KRW5.1 trillion (preliminary), growing at a slower pace compared with the previous month (up KRW6.5 trillion). (By Type) Home-backed mortgage loans grew KRW4.1 trillion across all financial sectors, rising at a slower pace compared with the previous month (up KRW5.5 trillion). Mortgage loans in the banking sector continued to grow at a slow pace (up KRW3.6 trillion up KRW1.5 trillion). Other types of loans increased KRW1.1 trillion overall, keeping the same level of growth from a month ago. Banks saw a small increase in unsecured loans (up KRW0.3 trillion up KRW0.4 trillion), while nonbanks saw a slight decline (up KRW0.8 trillion up KRW0.6 trillion). (By Sector) The pace of household loan growth slowed down in the banking sector while expanding in the nonbanking sector month-on-month. In November, banks saw an increase of KRW1.9 trillion in household loans, a drop from the increase of KRW3.8 trillion a month ago. The growth of policy-based loans expanded (up KRW2.0 trillion up KRW2.3 trillion) due to continuing demand for government-backed mortgage loans, but the issuance of banks own mortgage loans shifted down (up KRW1.5 trillion down KRW0.8 trillion). Other types of loans including credit loans in the banking sector rose at a slightly faster pace (up KRW0.3 trillion up KRW0.4 trillion) compared with the previous month. Nonbanks saw an increase of KRW3.2 trillion in household loans, growing at a faster pace from the previous month (up KRW2.7 trillion). Mortgage loans from nonbanks expanded at a faster pace (up KRW1.9 trillion up KRW2.6 trillion), but the pace of grow decelerated for other types of loans (up KRW0.8 trillion up KRW0.6 trillion). Mutual finance businesses (up KRW1.6 trillion), insurance companies (up KRW0.6 trillion), specialized credit finance businesses (up KRW0.6 trillion), and savings banks (up KRW0.4 trillion) all saw increases in household loans. (As
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Dec 03, 2024
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Nov 19, 2024
- Rule Changes on Corporate Mergers and Acquisitions Approved by the Government
- The Financial Services Commission announced that a revision bill for the Enforcement Decree of the Financial Investment Services and Capital Markets Act (FSCMA) intended to upgrade rules on corporate mergers and acquisitions (MAs) was approved by the government at the cabinet meeting held on November 19. The revised Enforcement Decree addresses the following(a) improving rules on determining merger prices when MAs take place between nonaffiliated business entities, (b) strengthening disclosure duties, and (c) revamping rules on the external evaluation process. First, the revised Enforcement Decree will improve rules on calculating and determining merger prices when MAs take place between nonaffiliated business entities. Previously, the Enforcement Decree had a provision directly regulating specific methods for calculating merger prices for MAs taking place between both affiliated companies and nonaffiliated companies. This rule may have acted as a barrier for companies when seeking corporate restructuring based on free negotiations. Therefore, the revised Enforcement Decree will remove the calculation method for merger prices for MAs taking place between nonaffiliated business entities, which will also help to enhance regulatory consistency with global standards. Second, the revised Enforcement Decree will bring about improvements to the external evaluation system by obligating companies to go through an external evaluation process when MAs take place between nonaffiliated business entities. For MAs between affiliated entities, companies will need to obtain consent from auditors (or audit committees) when selecting an external evaluation agency. In addition, the revised rules establish a code of conduct on quality management for external evaluation agencies to guarantee the maintenance of autonomy, objectivity, and fairness in performing functions related to MAs and address issues related to conflicts of interest. The revised Enforcement Decree will also require eva
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Nov 13, 2024
- Korea-Poland MOU on Banking Supervision Signed to Promote Overseas Expansion of Korean Financial Services
- Chairman Kim Byoung Hwan of the Financial Services Commission met with Jacek Jastrzebski, Chair of the Board of the Polish Financial Supervision Authority (KNF) at his office in Seoul Government Complex on November 13 where the two sides signed a memorandum of understanding (MOU) on banking supervision. This marks the first such visit to Korea by Chair of the Board of the Polish Financial Supervision Authority (KNF). Since the establishment of diplomatic ties in 1989, Korean companies have continued to expand their business presence in Poland. As of 2023, the number of Korean companies operating in Poland reached about 370 with the volume of investment standing at about KRW6 billion in cumulative terms and that of annual trade reaching about KRW9 billion. However, there still exist no Korean financial companies operating in Poland. As the financing needs and demand from Korean companies have been growing in local market, there has been growing interest among Korean financial companies to expand their presence in the Polish market. Following the previously held summit meetings between Korea and Poland (in July 2023 and October 2024), bilateral cooperation has been strengthened in the areas of defense industry, nuclear power, infrastructure, and advanced technologies, and it is highly anticipated that mutual exchange in economic and financial sectors will also accelerate. Against this backdrop, the visit by the Polish Financial Supervision Authority (KNF) along with the Polish banking sector delegation lays a foundation to boost bilateral exchange of banking businesses. Korea-Poland MOU on banking supervision At the meeting with Chair Jacek Jastrzebski of the Polish Financial Supervision Authority (KNF), FSC Chairman Kim Byoung Hwan showed strong commitment to boost cooperation going forward and talked about the significance of the progress made this year in enhancing financial cooperation between the two countries with the shuttle meetings held between chief financia
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Nov 11, 2024
- Household Loans, October 2024
- In October 2024, the outstanding balance of household loans across all financial sectors rose KRW6.6 trillion (preliminary), growing at a faster pace compared with the previous month (up KRW5.3 trillion). (By Type) Home-backed mortgage loans rose KRW5.5 trillion across all financial sectors, increasing at a slower pace compared with the previous month (up KRW6.8 trillion). Mortgage loans in the banking sector continued to rise at a slower pace (up KRW6.1 trillion up KRW3.6 trillion). Other types of loans increased KRW1.1 trillion overall, edging back up in both the banking (down KRW0.5 trillion up KRW0.3 trillion) and nonbanking (down KRW0.1 trillion up KRW0.8 trillion) sectors. (By Sector) The pace of household loan growth compared with the previous month decelerated in the banking sector while shifting back up in the nonbanking sector. In October, banks saw an increase of KRW3.9 trillion in household loans, a slowdown from the increase of KRW5.6 trillion a month ago. The growth of policy-based loans stayed at a similar level (up KRW2.1 trillion), but banks own mortgage loan issuance grew at a slower pace (up KRW4.0 trillion up KRW1.5 trillion) due to the self-regulatory move to tighten household loan issuance in the banking sector. Other types of loans including credit loans turned back up from a month ago (down KRW0.5 trillion up KRW0.3 trillion) due to the effects of demand for IPO subscriptions. The nonbanking sector saw an increase of KRW2.7 trillion in household loans, which expanded at a faster pace compared with the previous month (down KRW0.3 trillion). Mortgage loans in the nonbanking sector went up KRW1.9 trillion from the rise of KRW0.7 trillion a month ago led by group lending for new apartment subscriptions. Other types of loans increased KRW0.8 trillion from the decline of KRW1.0 trillion a month ago led by credit card and insurance policy-based loans. Mutual finance businesses (up KRW0.9 trillion), specialized credit finance businesses (up KRW0.9 tr
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Oct 31, 2024
- FSC Vice Chairman Visits Germany and Lithuania to Support Overseas Expansion of Korean Financial Services
- Vice Chairman Kim Soyoung of the Financial Services Commission visited Frankfurt, Germany and Vilnius, Lithuania from October 28 to November 1 in order to seek stronger financial cooperation with the European countries following bilateral summit meetings held in 2023. Meeting with ECB Supervisory Board Member On October 29, Vice Chairman Kim met with the European Central Bank (ECB)s supervisory board member Patrick Montagner to elicit consensus on the scope of cooperation prescribed in the draft memorandum of understanding (MOU) on banking supervision, which is expected to be signed by the end of this year. The agreed upon draft MOU contains provisions detailing cooperation and information exchange on banking supervision between the FSC and the FSS (Financial Supervisory Service) of Korea and the ECB regarding financial companies license application, appointment of directors, sanctions, and recovery and resolution plans (RRPs) upon request by the counterparty. This MOU is expected to help improve the crisis response capacity of both parties and enhance banking supervision through RRPs. After the fine-tuning of the draft MOU, Vice Chairman Kim and Mr. Montagner held talks on policy issues regarding sustainable finance and the introduction of artificial intelligence (AI) in the financial industry. On sustainable finance, both sides had opportunities to share their policy response and how they are dealing with the issue, for instance through climate risk stress test, etc. With regard to the advent of AI technology and its convergence with financial services, both sides agreed on the importance of international cooperation to build a regulatory framework that can help to maximize opportunities while minimizing risks presented by advance technologies. Meeting with Korean financial companies operating in Germany Vice Chairman Kim also held a meeting with a group of Korean financial companies doing business in Germany and had talks on local industry trend, operating condit
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Oct 31, 2024
- KoFIU Unveils H1 2024 Survey Result on Virtual Asset Service Providers
- The Korea Financial Intelligence Unit (KoFIU) conducted a survey on 21 registered virtual asset service providers (VASPs) to assess the current state of the domestic virtual asset market and keep relevant statistics up to date. Survey Overview (Respondents) 21 VASPs(14 exchange service providers and 7 wallet and custodian service providers) (Survey Method) Data collected from VASPs (Period Covered) January 1, 2024 to June 30, 2024 Key Survey Findings for H1 2024 The domestic market for virtual assets in H1 2024 continues to show an upward trend from H2 2023 with average daily trading volume (up 67%), market capitalization (up 27%), total amount of deposits (up 3%), and number of users eligible to trade (up 21%) all increasing from previous six months. Total operating profits (up 106%) of VASPs also went up significantly. When compared with the survey results of H2 2023, the number of virtual assets listed on exchanges declined due to increased number of coin-only exchange service providers closing down their business operations. The number of new listings by the KRW-based exchange service providers remained the same as previous six months (155), while the number of delistings went up slightly (up 7%). The number of exclusively listed virtual assetsthose tradable via single VASP in the domestic marketdropped considerably (down 14%). Maximum drawdown (price volatility) of virtual assets increased 8 percentage points from the previous six-month period to 70 percent. External transfer of virtual assets by exchange service providers also increased considerably (up KRW36.7 trillion, or 96%). Among them, those transferred to registered entities under the travel rule declined slightly (down 2%p), while those transferred to whitelisted overseas entities and digital wallets rose somewhat (up 1%p). The number of employees hired by VASPs rose 6 percent for KRW-based exchange service providers but fell 51 percent for coin-only exchange service providers due to a higher rate of b
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Oct 11, 2024
- Household Loans, September 2024
- In September 2024, the outstanding balance of household loans across all financial sectors rose KRW5.2 trillion (preliminary), growing at a slower pace compared with the previous month (up KRW9.7 trillion). * Change (in trillion KRW, m-o-m): +4.1 (Apr 2024), +5.3 (May), +4.2 (Jun), +5.2 (Jul), +9.7 (Aug), +5.2 (Sep)p (By Type) Home-backed mortgage loans rose KRW6.9 trillion, increasing at a slower pace compared with the previous month (up KRW8.5 trillion). Mortgage loans in the banking sector also rose at a slower pace from a month ago (up KRW8.2 trillion up KRW6.2 trillion). Other types of loans declined in both the banking (up KRW1.1 trillion down KRW0.5 trillion) and nonbanking (up KRW0.1 trillion down KRW1.2 trillion) sectors. (By Sector) The pace of household loan growth decelerated in both the banking and nonbanking sectors compared with the previous month. In September, banks saw an increase of KRW5.7 trillion in household loans, a slowdown from KRW9.2 trillion a month ago. This is mainly attributable to a slower pace of mortgage loan growth in the banking sector (up KRW8.2 trillion up KRW6.2 trillion), backed by the effects of implementing the second phase stressed debt service ratio (DSR) rule from September and the banking sectors self-driven moves to strengthen household loan management. Other types of loans, such as credit loans, in the banking sector edged down KRW0.5 trillion from the rise of KRW1.1 trillion a month ago. In the nonbanking sector, mortgage loans went up at a faster pace (up KRW0.3 trillion up KRW0.7 trillion) compared with the previous month, but other types of loans fell KRW1.2 trillion from the increase of KRW0.1 trillion a month ago due mainly to the effects of bad debt write-offs at the end of the quarter. Mutual finance businesses (down KRW0.4 trillion), specialized credit finance businesses (down KRW0.4 trillion), and savings banks (down KRW0.2 trillion) saw drops in household loans, while insurance companies (up KRW0.4 trillion)
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Sep 26, 2024
- Korea-Vietnam Financial Cooperation Forum Highlights Sustainable Finance and Capital Market Development
- Standing Commissioner Lee Hyung Ju of the Financial Services Commission traveled to Hanoi, Vietnam from September 25 to 26 to attend the Korea-Vietnam Financial Cooperation Forum, meet with senior officials from the State Bank of Vietnam and the State Securities Commission, and have a meeting with officials from local branches of Korean financial companies operating in Vietnam. Vietnam is Koreas third largest trade partner and it hosts the second largest number of Korean financial companies following the U.S. FSC Standing Commissioners visit this time was aimed at promoting domestic financial companies and policy financial institutions business expansion in Vietnam. Korea-Vietnam Financial Cooperation Forum On September 25, FSC Standing Commissioner Lee Hyung Ju attended the Korea-Vietnam Financial Cooperation Forum held in Hanoi under the theme of sustainable finance and capital market development. The forum was jointly sponsored by the FSC and Vietnams State Bank of Vietnam and State Securities Commission. The forum was organized into two parts(a) Towards a Sustainable Future: Enhancing Korea-Vietnam Financial Synergies and (b) Capital Market Development and Transition Finance. In the opening of the first part, Standing Commissioner Lee delivered congratulatory remarks where he introduced various climate finance strategies being pursued by the Korean government, such as the guidelines on K-taxonomy, green bonds and green finance, and ESG disclosure standards. Speaking on the mutually beneficial relationship that has been maintained between Korea and Vietnam since the establishment of diplomatic ties in 1992, Standing Commissioner Lee said that he expects this forum to help build a more future-oriented financial partnership between the two countries. In the second part, Standing Commissioner Lee delivered opening remarks where he introduced Koreas recent capital market reform initiatives and key elements of Corporate Value-up Program. To make sure that growth momen
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Sep 11, 2024
- Household Loans, August 2024
- In August 2024, the outstanding balance of household loans across all financial sectors rose KRW9.8 trillion (preliminary), growing at a steep pace compared with the previous month (up KRW5.2 trillion). * Change (in trillion KRW, m-o-m): -4.9 (Mar 2024), +4.1 (Apr), +5.3 (May), +4.2 (Jun), +5.2 (Jul), +9.8 (Aug)p (By Type) Home-backed mortgage loans rose KRW8.5 trillion, expanding at a significantly faster pace compared with the previous month (up KRW5.4 trillion). Other types of loans increased KRW1.3 trillion, with banks (down KRW0.1 trillion up KRW1.1 trillion) and nonbanks (down KRW0.1 trillion up KRW0.2 trillion) both experiencing a shift back up from the drops seen a month ago. (By Sector) Household loans grew at a much faster pace in the banking sector and turned back up from the previously declining trend in the nonbanking sector. In August, banks saw an increase of KRW9.3 trillion, a steep rise from the previous month (up KRW5.4 trillion). This was mainly attributable to an expansion of mortgage loans (up KRW5.6 trillion up KRW8.2 trillion) led by strong housing market activities in the Seoul metropolitan area. Other types of loans turned back up from a drop in the previous month (down KRW0.1 trillion up KRW1.1 trillion) mainly led by a rise in credit loans. In the nonbanking sector, household loans edged up from the decline seen a month ago as mortgage loans (down KRW0.1 trillion up KRW0.3 trillion) and other types of loans (down KRW0.1 trillion up KRW0.2 trillion) all increased. Specialized credit finance businesses (up KRW0.7 trillion) and savings banks (up KRW0.4 trillion) continued to see growth, while mutual finance businesses maintained the declining trend (down KRW1.0 trillion). Insurance companies saw a rise of KRW0.3 trillion from the decline seen a month ago. (Assessment) Household loans rose steeply in August compared with the previous month due to strong housing market transactions in the Seoul metropolitan area, large demand from borrowers pri
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Sep 04, 2024
- FSC Chairman Visits Japan to Strengthen Financial Cooperation and Promote Corporate Value-up Program
- Chairman Kim Byoung Hwan of the Financial Services Commission (FSC) traveled to Tokyo, Japan on his first overseas business trip since taking office in July 2024. On September 3, Chairman Kim had a meeting with the Commissioner of Japans Financial Services Agency (FSA), visited Japanese companies that have disclosed their value-up plans in Japan, and held talks with officials from Korean financial companies operating in Japan. Meeting with FSA Commissioner Since the financial authorities of Korea and Japan resumed their shuttle meeting for the first time in seven years in December last year at the 7th bilateral meeting held in Seoul, new leadership has been appointed at both organizations in July this year. Commissioner Ito Hideki of Japans Financial Services Agency (FSA) took office on July 5, and Chairman Kim Byoung Hwan of Koreas Financial Services Commission took office on July 31. On September 3, the new leaders of Korea and Japans financial authorities held a meeting at Japans FSA to exchange opinions on recent financial market developments and related issues and discuss ways to strengthen mutual cooperation. First, both leaders shared a common view on the need to strengthen bilateral cooperation to more effectively cope with volatility in global financial markets. Since monetary policies and economic situations in major economies, such as the U.S., E.U., and Japan, are reaching an inflection point, and as there are multiple variables that can have a significant impact on the global economy, such as the U.S presidential elections, both leaders agreed that there may be growing volatility in global financial markets in the future. As it was evident in the global stock market rout experienced in early August caused by fears of a recession in the U.S., both leaders assessed that financial market anxiety can erupt anytime if market participants overreact and if there is too much herd behavior. In order to respond to market volatility in a timely manner, both leader
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Aug 20, 2024
- FSC Chairman Meets with Banking Sector and Holds Talks on Financial Stability and Sustainable Growth
- Chairman Kim Byoung Hwan of the Financial Services Commission met with the heads of 19 banks and held talks on the importance of managing risks to ensure financial stability and seeking innovative ways to promote sustainable growth on August 20. Starting with todays meeting with the banking sector, Chairman Kim will meet with each financial sector to have discussions and exchange views on the four major risks facing the Korean economy, such as household debt, small business debt, real estate project finance debt, and the soundness of the nonbanking sector. In his opening remarks, Chairman Kim talked about the need to (a) preemptively manage the pace of household debt growth through concerted efforts of the banking sector and the government, (b) more systematically manage lending to small businesses based on their repayment capabilities, (c) pursue regulatory reforms to bring about change and promote innovation in banks operating practices, which have traditionally relied on interest rate spreads and domestic operations, and (d) continue to work on strengthening internal control mechanisms through the introduction of a responsibilities mapping system from January next year. In particular, with regard to the measures to control the pace of household debt growth, Chairman Kim stressed the need for banks to establish their own household debt management systems in a self-regulating manner based on the repayment capability (debt service ratio) of borrowers. To this end, Chairman Kim said that the following measures will be put into practice from September 1 for implementing the second phase stressed DSR rules. First, beginning on September 1, the second phase stressed DSR rules will take effect as announced previously, but mortgage loans for houses in the Seoul metropolitan area will be subject to an increased stress rate of 1.2%p, instead of 0.75%p. Second, from September, banks will be required to calculate DSR on all household loans for the purpose of internal manageme
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Aug 12, 2024
- Household Loans, July 2024
- In July 2024, the outstanding balance of household loans across all financial sectors rose KRW5.3 trillion (preliminary), growing at a faster rate compared with the previous month (up KRW4.2 trillion). * Change (in trillion KRW, m-o-m): -1.9 (Feb 2024), -4.9 (Mar), +4.1 (Apr), +5.3 (May), +4.2 (Jun), +5.3 (Jul)p (By Type) Home-backed mortgage loans rose KRW5.4 trillion, growing at a slower rate compared with the previous month (up KRW6.0 trillion), as banks saw a smaller increase in mortgage loans (up KRW6.2 trillion up KRW5.6 trillion). Other types of loans fell KRW0.2 trillion with declines seen in both the banking (down KRW0.3 trillion down KRW0.1 trillion) and nonbanking (down KRW1.5 trillion down KRW0.1 trillion) sectors. However, the pace of the decline decelerated compared with the previous month (down KRW1.8 trillion). (By Sector) Household loans expanded at a slower rate in the banking sector and declined at a slower rate in the nonbanking sector. In July, banks saw an increase of KRW5.5 trillion in household loans, a drop from KRW5.9 trillion in the previous month. The decline was led by the slowdown in mortgage loans (up KRW6.2 trillion up KRW5.6 trillion) as group lending for new apartment subscription fell KRW2.0 trillion from a rise of KRW0.1 trillion a month ago. Other types of loans declined at a slower rate compared with the previous month (down KRW0.3 trillion down KRW0.1 trillion). In the nonbanking sector, household loans declined at a significantly slower rate compared with a month ago (down KRW1.7 trillion down KRW0.2 trillion), due mainly to a base effect from the previous month. Mutual finance businesses (down KRW1.2 trillion) and insurance companies (down KRW0.02 trillion) continued to see declines, while specialized credit finance companies (up KRW0.8 trillion) and savings banks (up KRW0.2 trillion) saw increases. (Assessment) Household loans have been on an upward trajectory since April this year led by policy loans and mortgage loans from
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Aug 12, 2024
- FSC Chairman Holds Meeting with Listed Companies to Boost Corporate Value-up Efforts
- Chairman Kim Byoung Hwan of the Financial Services Commission held a meeting with a group of listed companies and related organizations to boost their efforts to participate in the Corporate Value-up Program on August 12. Together with related organizations, Chairman Kim said that the FSC will provide active support to promote companies self-driven efforts to participate in the Corporate Value-up Program. Todays meeting was joined by three companies (Kiwoom Securities Co., Meritz Financial Group Inc., and HK inno.N Corp.) that have already filed a voluntary disclosure or issued a prior notice of disclosure for their value-up plans and five other listed companies. Key officials from the Korea Exchange, Korea Listed Companies Association, KOSDAQ Listed Companies Association, Korea Financial Investment Association, and the value-up programs advisory group also attended the meeting. The following is a summary of FSC Chairman Kims remarks at the meeting. Regarding last weeks stock market volatility, the financial authorities are well aware of the concern about the relatively large fall experienced by our stock market and the slow pace of its recovery. In order to make our stock market more robust and resilient, it is important to boost participation in the Corporate Value-up Program, so that we can enhance the competitiveness of listed firms and the stock market. Moreover, making improvements to our capital market through the Corporate Value-up Program is also important from the perspective of seeking to transform our economic structure from the current debt-reliant model to an equity-centered approach. Making improvements to the current debt-dependent structure of our economy will help to make our economy more dynamic, enhance stability, and contribute to sustainable growth. Since introducing the outline of support measures for the Corporate Value-up Program in February this year, the government has worked to swiftly implement follow-up measures. The authorities will co
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Jul 22, 2024
- Vice Chairman Visits London to Promote Capital Market Reform Programs and Strengthen Bilateral Cooperation
- Vice Chairman Kim Soyoung of the Financial Services Commission visited London, the United Kingdom (UK) from July 16 to 19 in an effort to promote Koreas capital market reform and corporate value-up programs to global investors and to strengthen financial cooperation between Korea and the UK. IR with Global Investors On July 17, Vice Chairman Kim held an investor relations event for global investors and provided key information about the progress of Koreas capital market reform initiatives aimed at boosting market accessibility, guaranteeing fairness and transparency in market transactions, and enhancing shareholder values. In this regard, Vice Chairman Kim provided detailed information about the opening up of the foreign exchange (FX) market, plans to introduce an alternative trading system (ATS), short sale reform measures, and the corporate value-up program. UK-Korea Financial Forum On July 17, Vice Chairman Kim also attended the UK-Korea Financial Forum and delivered a congratulatory speech. In his remarks, Vice Chairman Kim talked about the importance of maintaining strong cooperation with the UK to effectively respond to various challenges and opportunities presented by shifting global market environment, such as technological advance and climate change. Meeting with Lord Mayor of the City of London On July 18, Vice Chairman Kim held a meeting with Lord Mayor Michael Mainelli of the City of London and exchanged views on key issues surrounding major elections around the world this year and policies to promote global financial hubs in both countries. At the meeting, Vice Chairman Kim took time to explain Koreas key financial policies, such as open banking, establishing a loan transfer infrastructure to facilitate refinancing of personal loans at lower interest rates, introducing financial MyData service, adopting guidelines on ESG disclosure, and so on. Meeting with FTSE Russell Following the meeting with the Lord Mayor of the City of London, Vice Chairman Kim vi
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Jul 10, 2024
- Household Loans, June 2024
- In June 2024, the outstanding balance of household loans across all financial sectors rose KRW4.4 trillion (preliminary), growing at a slower rate compared with the previous month (up KRW5.3 trillion). In the first half of 2024, household loans rose KRW7.9 trillion (up 0.5 percent), showing a stable trend of growth compared with the end of 2023. * Change (in trillion KRW, m-o-m): +0.9 (Jan 2024), -1.9 (Feb), -4.9 (Mar), +4.1 (Apr), +5.3 (May), +4.4 (Jun)p (By Type) Home-backed mortgage loans rose KRW6.1 trillion, growing at a slightly faster rate compared with the previous month (up KRW5.6 trillion), as the banking sector continued to see expansion of mortgage loans (up KRW5.7 trillion up KRW6.3 trillion). Other types of loans declined KRW1.7 trillion as the banking sector saw a drop of KRW0.3 trillion from the growth of KRW0.3 trillion a month ago and the nonbanking sector saw an expanded level of drop from a month ago (down KRW0.5 trillion down KRW1.4 trillion). (By Sector) Household loans grew at a similar level in the banking sector but fell at a faster rate in the nonbanking sector. In June, banks saw a rise of KRW.6.0 trillion in household loans, which showed a similar level of pace from the previous month (up KRW6.0 trillion), as mortgage loans went up at a faster rate (up KRW5.7 trillion up KRW6.3 trillion) with increased demand for policy mortgage loans and recovery in housing transactions. Other types of loans turned lower slightly compared with the previous month (up KRW0.3 trillion down KRW0.3 trillion). In the nonbanking sector, household loans fell at a faster rate (down KRW0.7 trillion down KRW1.6 trillion) due to the quarterly write-off of nonperforming loans. Mutual finance businesses (down KRW1.0 trillion), specialized credit finance companies (down KRW0.3 trillion), and savings banks (down KRW0.3 trillion) saw declines, while insurance companies saw a slight rise (up KRW0.02 trillion). (Assessment) The financial authorities assessed that the growt
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Jul 08, 2024
- FSC Vice Chairman Speaks about Megatrends and Policy Framework at Future Finance Seminar
- Vice Chairman Kim Soyoung of the Financial Services Commission attended a policy seminar on future finance hosted by Korea Institute of Finance and sponsored by the FSC on July 8. Todays seminar was held under the theme of future megatrends and impending changes in the financial sector, which brought together public and private sector experts with diverse backgrounds, to have discussions on the impact of rapidly changing demographic structure, climate change, and technological advance on the financial market and ways to effectively cope with these changes. At the beginning of the seminar, Vice Chairman Kim delivered a keynote address on the topic of megatrends and policy framework for future finance, in which he emphasized the need for the financial industry and the government to prepare measures to secure sustainable ways to grow in a preemptive manner. The following is a summary of Vice Chairman Kims remarks. Against the backdrop of rapidly changing financial environments and market conditions, the authorities have been thus far mostly focused on responding to issues that needed to be addressed urgently. However, since financial policy can have a significant impact on the structural and macro-level changes, it is important that the authorities set their sight on a medium- to long-term horizon when formulating policy responses. In this regard, the authorities are working on policy frameworks for future finance, based on systematic analyses intended to minimize risks and seek opportunities for growth over a medium- to long-run. The taskforce on future finance organized into three sub-groupsdemographic shift, climate change, and technological advancehave been examining both challenges and opportunities in their respective areas, while seeking policy measures with three specific aimsmitigation, adaptation, and innovation. The mitigation policy is aimed at reducing the impact of impending change and shock, while slowing the pace of their occurrence. The adaptation poli
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Jul 03, 2024
- SFC Imposes Penalty Surcharges on Global Investment Banks for Violating Short Sale Regulations
- The Securities and Futures Commission, a sub-commission within the Financial Services Commission responsible for overseeing the securities and futures markets, held the thirteenth regular meeting on July 3 and decided to impose penalty surcharges amounting to KRW27.173 billion in total on two former Credit Suisse affiliated investment banks for violating short sale regulations under the Financial Investment Services and Capital Markets Act (FSCMA). The level of penalty surcharge imposed on each of the two former Credit Suisse affiliated entities is the largest (KRW16.94 billion on Credit Suisse AG) and the third largest (KRW10.23 billion on Credit Suisse Singapore Ltd.) ever since the penalty surcharge system began to be implemented on naked short sale activities in April 2021. In the case of Credit Suisse AG (currently UBS AG), from April 7, 2021 to June 9, 2022, the investment bank was found to have engaged in naked short sales in the amount of about KRW60.33 billion (162,365 shares on 20 stock items) without possessing these stocks at the time of placing short sale orders. In the case of Credit Suisse Singapore Ltd., from November 29, 2021 to June 9, 2022, the investment bank was found to have engaged in naked short sales in the amount of about KRW35.28 billion (401,195 shares on five stock items) without possessing these stocks at the time of placing short sale orders. In addition, prior to todays meeting, the SFC decided to impose administrative fines worth KRW284.2 million in total on four domestic financial investment businesses, two foreign financial investment businesses, and an individual investor for violating their net short position balance reporting and disclosure duties under the FSCMA. The financial authorities will continue to strictly deal with naked short selling and other unfair trading activities in capital market to promote soundness in market transactions. * Please refer to the attached PDF for details.
