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Feb 13, 2020
- FSC to Hold Information Session on Revised Credit Information Act
- The Financial Services Commission will hold an information session on February 20, 2020 on the amendment of the Credit Information Use and Protection Act, which is scheduled to take effect starting August 5, 2020. The information session will provide useful information about the revised law, while offering the government a chance to listen to and gather opinions from diverse stakeholders. The FSC will revise relevant rules and regulations prior to the effective date while working to reflect public opinions.KEY FEATURES OF THE AMENDMENT► ESTABLISHING NEW LEGAL BASIS FOR USING AND ANALYZING BIG DATA- Pseudonymised personal information may be used without consent for statistical, industry research and public documentation purposes.- Converging data is permitted only by the institutions designated by the government.- Safety measures are established for the use and convergence of pseudonymised data, including a prohibition on re-identification of pseudonymised data and a requirement for separate management of additional information. ► STRENGTHENING THE ROLE OF PERSONAL INFORMATION PROTECTION COMMISSION- The revision bill on the Personal Information Protection Act upgrades the status of the Personal Information Protection Commission (PIPC) from an administrative commission to that of a central administrative agency with authority to conduct investigations, regulate commercial enterprises and implement relevant laws.► IMPROVING REGULATORY FRAMEWORK ON CREDIT BUREAU INDUSTRY- The credit bureau industry will be categorized into a) personal CB, b) individual business CB and c) corporate CB, while the entry barrier for credit bureau businesses will be lowered.- The current regulation which restricts credit bureau businesses from performing for-profit operations will be lifted, and credit bureau businesses will be allowed to conduct data analysis and processing as well as consulting.- Conduct regulations will be established to improve the soundness of the credit bureau in
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Feb 13, 2020
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Feb 12, 2020
- Government to Support Educational Programs to Cultivate Digital Finance Specialists
- The Financial Services Commission and the Seoul Metropolitan Government will provide KRW19 billion over a 4-year period (2020-2023) to launch educational programs aimed at cultivating more specialists in digital finance.Digital finance provides financial services using key innovations in information technology, such as big data and artificial intelligence. It has created new jobs and brought significant changes to how financial services are delivered.Due to rapidly accelerating digital transformation in the financial sector, the demand for more professionals working in digital finance has been rising.The degree and non-degree programs will offer advanced theory and practice courses on diverse areas, such as ‘IT deep learning,’ ‘big data crawling and text analysis,’ ‘cloud computing,’ ‘blockchain in finance,’ etc.The programs are targeted at the current financial industry workers, prospective fintech entrepreneurs, fintech professionals, and those who are preparing for financial sector jobs.The government will select an educational institution or a consortium in March to be designated as the digital finance education provider. Universities, research and/or other finance-related institutions are eligible to apply.* Please refer to the attached PDF for details.
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Feb 07, 2020
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Feb 05, 2020
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Feb 03, 2020
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Jan 30, 2020
- FSC to Introduce Coinsurance for Primary Insurers
- FSC Vice Chairman Sohn Byungdoo presided over a meeting on improving the soundness of assets held by primary insurance companies on January 30, 2020.The measures to introduce coinsurance was discussed at the meeting to help insurance companies adjust or reduce debts in preparation for the implementation of the new accounting and solvency rules, the International Financial Reporting Standards (IFRS) 17 and K-Insurance Capital Standard (K-ICS).The introduction of coinsurance is expected to help improve financial soundness of primary insurers as they are able to cede risks associated with insurance products to reinsurance companies.COINSURANCECoinsurance is a type of full-risk reinsurance through which primary insurers can transfer risks to reinsurers at premiums. Coinsurance is different from traditional reinsurance because it allows primary insurers to cede an entire block of risks including the investment portion and expense loading of the premium, instead of only the risk portion of the premium. Traditional reinsurance normally has a yearly renewable term whereas coinsurance offers longer term deals.EXPECTATIONI. Primary insurers with high interest rate products can cede risks associated with interest rate volatility or cancellation to reinsurers, thereby boosting their financial soundness.II. Issuing new capital stocks or subordinated debentures is an expansion of the available capital, whereas coinsurance is downsizing the required capital, which will offer a new solution for managing risk exposures for insurance companies.III. Coinsurance has been widely used in the European and the US insurance markets. The know-hows and asset management experiences of the overseas reinsurers will be useful.SPECIFIC PLANSTo introduce coinsurance, the government will make the following changes to the current regulations and rules on the supervision of insurance businesses – a) permit coinsurance, b) make accounting methods clearer, c) improve the risk-based capital ratio, and
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Jan 28, 2020
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Jan 28, 2020
- Government Bolsters Market Monitoring amid Coronavirus Outbreak
- FSC Vice Chairman Sohn Byungdoo convened a meeting on January 28, 2020 to assess the impact of the spread of coronavirus on the domestic and global financial markets. Amid rising concerns over economic and financial markets at home and abroad, the Korean government has put in place a response system, working on preventive measures and monitoring its impact on our economy.The following is a summary of Vice Chairman Sohn’s remarks:The financial markets in Korea remained stable until mid-January following the conclusion of the first phase deal between the US and China over their trade conflicts and due to eased tension in the Middle East. However, with the spread of the new coronavirus, volatility increased last week.Today, KOSPI fell 3.1 percent while the won-dollar exchange rate rose 0.7 percent (up 8.0 won).Based on our past experiences with the SARS (severe acute respiratory syndrome) outbreak in 2003, the avian influenza in 2009, and the Middle East respiratory syndrome (MERS) in 2015, the impact of the new coronavirus outbreak on domestic financial markets will depend on how extensive it spreads in Korea.The Korean financial markets may experience rising volatilities for a while due to increased appetite for risk-free assets.However, Korea’s external soundness remains solid as its foreign exchange reserves (USD408.8 billion by the end of 2019) and net foreign assets in debt instruments (USD479.8 billion by end of Q3 2019) increased to record high levels.In order to stabilize financial markets, the government should bolster the 24-hour market monitoring system and be prepared for any volatility. The government should also work to provide financial assistance to the industries that may be heavily affected by the epidemic, such as the tourism industry.* Please refer to the attached PDF for details.
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Jan 21, 2020
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Jan 21, 2020
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Jan 20, 2020
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Jan 20, 2020
- Government Prepares to Launch Asia Region Funds Passport in May
- The government has revised the enforcement decree of the Financial Investment Services and Capital Markets Act and other relevant rules for the implementation of the Asia Region Funds Passport. The ARFP will be launched on May 27, 2020 after a 40-day of promulgation and screening of regulations.BACKGROUNDThe ARFP is a multilateral investment promotion initiative between the five member economies1 aimed at promoting cross-selling of publicly offered local funds in each other’s economies through standardized and streamlined registration process.The five member economies agreed to launch the ARFP at the APEC finance ministers’ meeting in September 2013. The members signed a memorandum of cooperation (MOC) in April 2016, and have worked on domestic legislative changes for the implementation.In November 2019, the Korean government completed the revision of the Financial Investment Services and Capital Markets Act, and has since worked on revising the relevant rules and regulations to reflect the details of the MOC.KEY PROVISIONS► REGISTRATION FOR LOCAL FUNDSPublicly offered local funds in Korea that meet the following requirements can apply to be registered as passport funds to be offered in overseas markets.► REGISTRATION FOR FOREIGN PASSPORT FUNDSForeign passport funds, by submitting registration statement, will be available for sale in Korea through a streamlined process.If an infringement of the MOC is found to have occurred by another member country, or the Korean funds face unfair sales restrictions overseas, the government may withdraw the privilege.Foreign passport funds sold in Korea will be subject to the same rules, regulations and investor protection measures as the local publicly offered funds.► REGULATION FOR INVESTOR PROTECTIONAll passport funds are subject to compliance audit regardless of the size of the fund. The fund managers are also required to report to both the home and the host countries about of the relevant information regarding funds,
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Jan 16, 2020
- FSC Tightens Housing Loan Rules
- The FSC unveiled measures to tighten housing loan rules, which will take effect on January 20, 2020.For high-priced homeowners whose property value is over KRW900 million, loan guarantees for jeonse1 will no longer be offered by Seoul Guarantee Insurance Company (SGI). The restriction on jeonse loan guarantees by public guarantee institutions, such as Korea Housing Finance Corporation (KHFC) and Korea Housing Urban Guarantee Corporation (HUG), has already been in place since November 11, 2019, pursuant to the measures unveiled on October 1, 2019.For individuals who receive jeonse loan guarantees from KHFC, HUG or SGI and purchase a high-priced home or become a multiple homeowner thereafter, the said jeonse loan will be collected.* Please refer to the attached PDF for details.
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Jan 15, 2020
- FSC to Hold 2020 Korea Fintech Week
- The Financial Services Commission will hold the 2020 Korea Fintech Week from May 28 to 30, 2020 at Dongdaemoon Design Plaza (DDP), Seoul to promote fintech and innovation in the financial industry. BACKGROUND The FSC hosted Koreas first global fintech expo in 2019, providing opportunities for networking and information sharing on the latest trends in fintech. The three-day event was attended by more than 10,000 people. Connecting fintech firms with both domestic and foreign investors, the 2019 Korea Fintech Week attracted about KRW30 billion worth of investment in fintech businesses. 2020 KOREA FINTECH WEEK This years Korea Fintech Week is aimed at supporting fintech scale-ups. It will be held under the theme of Fintech for Open Innovation. Centered on the governments policy to support fintech firms to scale up,1 the three-day expo will feature programs, such as seminars, special sessions, educational programs, idea contest exhibition, etc. REGISTRATION SCHEDULE Preliminary application for participation in the 2020 Korea Fintech Week will be available starting from the second week of April through www.fintechweek.or.kr/2020. For further information, please contact the Fintech Center Korea via email fintechweek@fintechcenter.or.kr or by phone +82-70-8873-9005, 9006. * Please refer to the attached PDF for details.
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Jan 14, 2020
- Vice Chairman Attends FSB Steering Committee Meeting in Basel
- FSC ViceChairman Sohn Byungdoo attended the Financial Stability Board (FSB) steeringcommittee meeting held on January 13, 2020 in Basel, Switzerland.The steeringcommittee meeting was attended by the heads of central banks and financialregulatory bodies from 20 countries and 11 international organizations, such asthe International Monetary Fund and the European Central Bank. The members helddiscussions on the risk assessment of non-bank financial institutions and waysto respond to risks associated with stablecoins.With regard to non-bankfinancial intermediaries, Vice Chairman Sohn stated that it is both timely andimportant to reassess the regulatory and supervisory framework of non-bankfinancial intermediaries given their size and global linkages. The recent trendof low interest rates may further aggravate risks in non-bank financialintermediaries due to a prevalent tendency toward high-risk, high-yield assets,Vice Chairman Sohn said.In this regard,the Korean government has been managing potential systemic risks in non-bankfinancial sectors by analyzing ‘activities’ and ‘entities’ separately, ViceChairman Sohn added.On regulatingstablecoins, the FSC agreed on the principle that a holistic approach to riskassessment should take place and that appropriate regulatory measures should beestablished prior to incorporating stablecoins in the global financial system.Considering the effects of stablecoins on monetary policy and anti-moneylaundering regime, the FSC reaffirmed the need to bolster cooperation withinternational organizations, such as the IMF and the Financial Action TaskForce.To preventregulatory arbitrage using stablecoins, Vice Chairman Sohn emphasized theimportance of increasing efforts for coordination between the developed anddeveloping countries.* Please refer to the attached PDF for details.
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Jan 09, 2020
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Jan 09, 2020
- Joint Response Unit on Financial Markets Holds First Meeting
- FSC Vice Chairman Sohn Byungdoo presided over the first meeting of the joint response unit on financial markets on January 9, 2020 to assess the impact of the recent Middle East instability on domestic financial markets. The officials from the relevant ministries and public institutions as well as private sector experts attended the meeting.The following is a summary of Vice Chairman Sohn’s keynote address:BACKGROUNDThe escalating conflict between the US and Iran has led to increased financial market volatilities both at home and abroad. Following President Donald Trump’s announcement not to seek further military action against Iran, the US stock market closed higher yesterday with Dow Jones adding 0.56% and SP500 gaining 0.49%. However, there are lingering uncertainties and the government has been preparing contingency plans considering all possible scenarios.On January 8, the government set up a joint response system in order to more systematically respond to situations. Today’s meeting on financial markets is one of the five thematically organized units.1DOMESTIC FINANCIAL MARKETSThe domestic financial markets have fluctuated recently2 against the backdrop of the US-China first phase trade agreement and the recent instability in the Middle East. Despite increased market volatilities following the uncertainty in the Middle East, it is necessary to remain calm and prudent.Korea’s external soundness remains solid as the net foreign assets in debt instruments (USD 479.8 billion) and the foreign exchange reserves (USD 408.8 billion) posted record highs in 2019. Given a low level of Iranian funds in domestic stock markets, the possibility of capital flight or damages to the financial soundness1 Five joint response units: financial markets, international oil prices, real economy, overseas construction and overseas logistics2 KOSPI: Jan. 6 (2,155.1, -0.98%) → Jan. 7 (2,175.5, +0.95%) → Jan. 8 (2,151.3, -1.11%)USD/KRW FX rate: January 6. (1,172.1, +5.0 won)
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Jan 08, 2020
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Dec 23, 2019
