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Sep 25, 2024
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Sep 24, 2024
- Revised Rules on Microfinance Support Expected to Increase Availability of Funds for Inclusive Finance
- The Financial Services Commission announced that a revision bill for the Enforcement Decree of the Microfinance Support Act was approved by the government at the cabinet meeting held on September 24. This revision bill is aimed at ensuring stable foundations for supplying microfinance assistance to vulnerable groups as the need to provide policy-based microloan products has been growingagainst the backdrop of the continuation of challenging economic conditions, such as high interest rates and high prices. In this regard, the revised rules will temporarily (a) increase the common rate of microfinance contributions financial companies are required to make, while (b) offering an incentive of reduction in the differential contribution amounts (which are determined by financial companies subrogation rates) to those making active efforts in supplying policy-based microloan products. First, the common rate of microfinance contributions financial companies make in relation to the size of their household loans, which currently stands at 0.03 percent, will be increased by 0.005 percentage points for banks to 0.035 percent and by 0.015 percentage points for insurance companies, mutual finance businesses, specialized credit finance businesses, and savings banks to 0.045 percent. The increased common contribution rates will be in place until December 31, 2025. This is expected to help expand the availability of funds for guarantees intended to supply policy-based microfinance assistance. Second, financial companies that are making active efforts in supplying policy-based microloan products will be eligible to receive a reduction in the amount of microfinance contributions they are required to make in relation to their subrogation rates (differential contribution rates) on a temporary basis until December 31, 2025. It aims to lower financial companies burden of differential contribution amounts, which are determined by their subrogation rates, for those with outstanding records i
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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 09, 2024
- Regulatory Improvements Proposed for Payment Gateway Services in Wake of Recent E-commerce Payment Failures
- The Financial Services Commission announced a set of measures intended to improve regulations on electronic payment settlement agency services (payment gateway or PG services) on September 9. The proposed measures are aimed at preventing the recurrence of payment delays involving PG services recently seen in the large-scale e-commerce payment failures. The measures have been prepared after coordinating with related government ministries and collecting opinions from experts. First, there will a measure to safely protect the total amount of unsettled payments from PG services. To ensure stability in the payment and settlement system, PG services will be required to separately manage the total amount (100 percent) of unsettled funds in the form of deposit, trust, or payment guarantee insurance, and inform this to sellers when entering into an agreement and disclose this information on their website. However, considering the burden of regulatory compliance, there will be a grace period and the separate management requirement will be phased in graduallyfor instance, 60 percent of unsettled funds during the first year of implementation, 80 percent for the second year, and 100 percent for the third year. In addition, unsettled funds being separately managed shall not be allowed for a transfer or to be used as a collateral, or put up for confiscation or setoff by a third party. Moreover, a priority right to payments will be introduced to ensure safe protection of unsettled funds even when PG services become bankrupt. Second, there will be practical management and supervisory mechanisms designed to encourage sound operation of PG services. Since there currently exist no legal means to enforce PG services to comply with operational guidelines even when there is noncompliance, regulatory tools (corrective order, business suspension, and revocation of registration) will be introduced to enable financial authorities to take actions against noncompliance when there is a failure t
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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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Sep 03, 2024
- Revised Rules on Electronic Financial Transactions to Take Effect from September 15
- The Financial Services Commission announced that the government approved a revision bill for the Enforcement Decree of the Electronic Financial Transactions Act at the cabinet meeting held on September 3. Together with the previously amended Act on Electronic Financial Transactions (approved on September 14, 2023), the revised rules will help to close the regulatory loophole on electronic prepayment means and strengthen protection for advance payments made for electronic prepayment means. The revised rules on electronic financial transactions are scheduled to take effect from September 15. First, under the revised rules, prepayment service providers are required to separately manage the total amount (100 percent or more) of advance payments made by their customers, thereby strengthening protection for users. In addition, to prevent prepayment service providers from issuing advance payments at discounted rates in excessive levels, the revised rules will only allow them to issue advance payments at discounted rates or offer rewards points only when their debt ratio is 200 percent or below. In this case, the total amount of advance payments required to be separately managed by prepayment service providers includes the amount of monetary benefits offered to customers (discounts and rewards). Advance payments managed separately in the form of a trust or a payment guarantee insurance need to be managed only through investment in safe assets, such as Korea Treasury bonds and local government bonds, or through deposits at banks and Korea Post. The revised rules also make sure that customers are able to get refunds even when their prepayment service providers go bankrupt. In this case, the prepayment service provider will provide relevant information about refunds to the entity in charge of managing advance payments to facilitate the reimbursement of funds to customers. Second, under the revised rules, the scope of prepayment service providers that are subject to the user pr
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Aug 27, 2024
- 2024 Korea Fintech Week Kicks Off on August 27
- 2024 Korea Fintech Week kicks off on August 27 with major fintech businesses, financial companies, related organizations, academic institutions, and foreign governments and organizations at Dongdaemun Design Plaza (DDP) in Seoul. The expo will be held for three days between August 27 to 29 under the theme of Beyond Boundaries: Fintech and AI Redefining Finance, providing opportunities to lure investment and share updates on the newest fintech and AI technologies and trends. 85 exhibition booths and 109 businesses and associations will participate to promote innovative technologies and attract investments Chairman Kim Byoung Hwan of the Financial Services Commission delivered welcoming remarks in which he emphasized the importance of AI as a game changer for industries and society, and how we harness AI will determine the competitiveness of individuals and companies in the future. Chairman Kim vowed to support the finance industry so that it could play a leading role in propelling Korea into the top three nations in AI sector. Chairman Kim outlined four key directions for digital finance policies aimed at facilitating fintech and the digital transformation (DX) of the financial sector. First, he emphasized the need to revisit financial regulations established in the analog era to accelerate the digital transformation of finance. This will involve rationalizing entry and conduct regulations for financial companies, as well as standards for information processing, such as cloud usage. Second, Chairman Kim highlighted the importance of strengthening collaboration between fintech companies and financial companies. To this end, the regulations on financial institutions investments in fintech businesses will be re-evaluated, and discussions will begin on reforming the regulatory framework governing outsourcing agreements, as well as improving the electronic financial systems, to allow the emergence of diverse business models in the era of big blur. Third, Chairman Kim anno
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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 13, 2024
- FSC Introduces Roadmap to Make Improvements to Network Separation in Financial Industry
- The Financial Services Commission held a meeting with private sector experts, financial industry groups, and officials from the Financial Supervisory Service (FSS) and Financial Security Institute (FSI) and introduced a roadmap to bring about improvements to network separation in the financial industry on August 13. After having a series of meetings with financial companies and operating a taskforce to gather opinions from cybersecurity experts, related industries, and organizations, the FSC has prepared a set of measures to improve upon the current regulatory system on network separation and ways to upgrade rules on financial data security. Background The current requirement of network separation has been pointed out as a source of inefficiency and an obstacle for research and development projects for financial companies in their use of new technologies. In particular, with the rapid transition of software into a cloud-based software as a service (SaaS) and the growing importance of generative artificial intelligence (AI), network separation may not only present a source of inconvenience but also stand in the way of boosting competitiveness of the financial industry. Therefore, after ten years of introducing the rule on network separation, the FSC plans to seek a paradigm shift for finding an appropriate balance between innovation and security by upgrading outmoded regulations and overhauling rules and regulations on financial data security over a medium- to long-term. Resolving Regulatory Hurdles through Regulatory Sandbox Program Considering that the current regulatory system on financial data security has been built on an intranet network environment, authorities will seek to ease relevant regulations gradually and in stages. While seeking to promptly resolve regulatory hurdles through the regulatory sandbox program, authorities will prepare sufficient levels of safety mechanisms to ensure cyber and information security until a self-regulating and autonomous dat
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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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Aug 08, 2024
- FSC Vice Chairman Speaks on Strengthening Sanctions against Unfair Trading Activities in Capital Market
- The Financial Services Commission announced that a policy seminar on ways to strengthen sanctions against unfair trading activities in capital market was held by the Korea Exchange (KRX) and Korea Capital Market Institute (KCMI) on August 8. Vice Chairman Kim Soyoung of the Financial Services Commission attended the seminar and delivered congratulatory remarks. In his speech, Vice Chairman Kim outlined the governments past efforts and progress so far and plans to introduce more diverse sanctions mechanisms targeted at unfair trading activities. The following is a summary of Vice Chairman Kims remarks. In order to more effectively detect and strictly punish unfair trading activities, the government has worked to improve the capital market investigation regimes and bolster sanctions, while boosting incentives for reporting. In this regard, first, a well-coordinated investigation network has been established among related agencies, enabling frequent inter-agency sharing of information about ongoing investigations. Second, against the three major types of unfair trading activities, which include the use of material nonpublic information, price manipulation, and dishonest transactions, imposing penalty surcharges has now become available as a sanctions mechanism. Third, incentives for whistleblowers has been increased to encourage wrongdoers and wrongdoing to be reported. However, the existing sanctions mechanisms have limits in effectively dealing with the ever evolving and complex patterns of unfair trading activities. The current sanctions mechanisms, which focus on criminal punishment and monetary penalty, often take long times to arrive at a final court sentence and are rather ineffective at preventing recidivism. Major overseas economies, such as the U.S. and Hong Kong, have adopted non-monetary sanctions mechanisms to combat unfair trading activities. After closely studying these cases from overseas, the government is seeking to introduce more diverse sanctions me
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Aug 06, 2024
- Financial Support Programs Available for Enterprises Affected by E-commerce Payment Delays
- The Financial Services Commission announced that the previously announced KRW560 billion-plus financial support programs intended to help the sellers affected by recent payment delays at e-commerce platforms will begin to be provided from August 7. As of the end of July, the volume of missed payments by e-commerce platforms (TMON and WeMakePrice) stood at about KRW274.5 billion. As the size of delayed payments is expected to grow in the future, authorities will also consider expanding the size of assistance if it becomes necessary. First, from August 7, sellers that have been hit by payment delays can apply for maturity extension and payment deferment on existing business loans and guarantees for up to one year. In addition, from August 7, the support for maturity extension and payment deferment will also be made available for accounts receivable loans offered by three banks (Shinhan, KB Kookmin, and SC Banks). Second, the Industrial Bank of Korea (IBK) and Korea Credit Guarantee Fund (KODIT) will make available guaranteed loans worth KRW300 billion-plus. Individual businesses are eligible to apply for up to KRW3 billion. The application review process will be streamlined for those seeking to get up to KRW300 million. KODIT will begin to accept application for guarantees from August 9. The Ministry of SMEs and Startups will also make available financing support worth about KRW200 billion at low interest rates through Korea SMEs and Startups Agency (KOSME) and Small Enterprise and Market Service (SEMAS). Third, the government, related organizations, and industry groups will continue to operate an emergency response team to make sure that the financial support programs are effectively operated and proper consulting can be provided to those needed. * Please refer to the attached PDF for details.
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Aug 05, 2024
- FSC Chairman Holds Meeting and Emphasizes Importance of Comprehensive Efforts to Manage Debt Risks
- Chairman Kim Byoung Hwan of the Financial Services Commission held a meeting with macroeconomic and financial market experts on August 5 to review financial risks in four specific sectors, which include debt risks in the household, real estate project finance, and small business sectors, and the soundness of the nonbanking sector, and discussed ways to effectively manage these risks. The following is a summary of Chairman Kims remarks at the meeting. A Summary of Chairmans Remarks Current economic conditions at home and abroad appear to be reaching an inflection point, shown by recent monetary policy decisions in major economies, economic forecasts in the U.S., and domestic housing market situation. Against this backdrop, it is necessary to strengthen our efforts to examine and respond to market risks. While focusing our efforts to promptly and closely manage debt risks in four specific areas, which have been accumulated from the past, it is also essential to take steps to preemptively manage newly emerging risk factors. As there exist concerns about the weakening of the U.S. economy, major stock markets around the world have tumbled recently.Therefore, it is also necessary to maintain close monitoring over volatility in stock markets. The government is focused on working to bolster our stock markets resilience and establish a more credible and reliable market environment for investors by seeking structural improvements over a medium- to long-term. To this end, the government will continue to make efforts to ensure seamless implementation of the Corporate Value-up Program and short sale reform measures. Along the same lines, the government will continue to work on tax support measures that can help to boost investments in the domestic stock market. The relatively high levels of debt-to-GDP ratioand reliance on debt make domestic financial system vulnerable to external shocks. In order to ensure sustainable growth and make our economy more resilient and to guarantee
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Jul 29, 2024
- Authorities Announce Financial Support Measures for Enterprises Affected by E-commerce Payment Delays
- The Financial Services Commission held a meeting with the Ministry of SMEs and Startups (MSS), related organizations, and financial industry associations on July 29 to seek close cooperation from the financial industry to help minimize the damage caused by recent payment delays from e-commerce platforms (TMON and WeMakePrice). First, the FSC and the MSS requested that maturity extension and payment deferment on existing loans to be made available to the vendors affected by payment delays. In this regard, all financial sectors and policy financial institutions agreed to provide up to one year of maturity extension and payment deferment on their existing loans. Maturity extension will also be provided to vendors on existing e-commerce seller loans to ensure that they face no risk of credit downgrading. Second, the FSC plans to make available emergency funds worth KRW300 billion-plus in the form of guaranteed loans offered by Korea Credit Guarantee Fund and Industrial Bank of Korea (IBK) to facilitate low interest financing of SMEs temporarily having liquidity problems due to payment delays. Specific details of the guaranteed loan support program will be determined for announcement in coming days. Third, the MSS plans to provide policy financing support worth about KRW200 billion to assist small merchants and SMEs affected by payment delays. Fourth, the Ministry of culture, Sports and Tourism will operate an interest rate support program (2.5 to 3.0%p) in the amount of about KRW60 billion to help tourism businesses. The government, related organizations, and industry groups will operate an emergency response team to make sure that the financial support programs are effectively operated and the affected businesses can get support through proper channels. * Please refer to the attached PDF for details.
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Jul 25, 2024
- 2024 Korea Fintech Week to Kick Off on August 27
- The Financial Services Commission announced that this years global fintech expo, 2024 Korea Fintech Week, is scheduled to kick off on August 27 with major fintech businesses, financial companies, related organizations, academic institutions, and foreign governments and organizations participating at Dongdaemun Design Plaza (DDP) in Seoul. This years global fintech expo, the largest ever in scale, will be held for three days between August 27 and 29 under the theme of Beyond Boundaries: Fintech and AI Redefining Finance, providing visitors and participants with opportunities to share global trends on artificial intelligence (AI) and fintech innovation and gain insights on financial industrys future ecosystem. After an opening ceremony, there will be a policy information session provided by the FSC on Koreas fintech policy direction for this year and an on-site QA session with officials. Visitors will have chances to participate in eleven different seminars throughout three days, dealing with topics, such as AI and fintech, fintech investment strategy, ESG, and so on, with specific focus on AI technologies and their application. In addition, there will be ample opportunities to attract investments through investor relations (IR) and reverse IR events, which will help to promote investments for fintech firms to scale up or expand their businesses overseas. There will be a total of 85 exhibition booths organized into four different exhibition hallsfintech hall, financial hall, cooperating organization hall, and global hallshowcasing latest fintech services embracing AI technologies. During the three-day period, various consulting and networking programs will also be made available for fintech startups, entrepreneurs, and young adults seeking career opportunities in fintech. Visitors can attend and tour at free of charge. For more information please visit official expo website (https://2024.fintechweek.or.kr/). * Please refer to the attached PDF for details.
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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 17, 2024
- The Act on the Protection of Virtual Asset Users to Take Effect from July 19
- The Financial Services Commission announced that the Act on the Protection of Virtual Asset Users, which intends to establish a sound order in the virtual asset market and ensure protection for users, will take effect from July 19. Background In March 2021, the Act on Reporting and Using Specified Financial Transaction Information was revised to introduce a requirement under which virtual asset service providers (VASPs) were mandated to register with the financial authority. In addition, various types of regulatory mechanisms, such as travel rule, that are aimed at preventing money laundering were established. However, it was continuously pointed out that the regulatory framework centered on anti-money laundering was not adequate for authorities to actively respond to various types of unfair trading activities, such as price manipulation, and for guaranteeing safe protection of users assets. Considering the importance and urgency of providing safe protection for users, the Virtual Asset User Protection Act was enacted on July 18, 2023, reflecting key provisions proposed under 19 legislative bills that were pending at the National Assembly. For about one year since then, subordinate regulations have been drawn up, and VASPs were given the time needed to prepare for the implementation of the Virtual Asset User Protection Act from July 19, 2024. Key Provisions of the Virtual Asset User Protection Act This Act contains provisions (a) protecting users deposits and virtual assets, (b) regulating unfair trading activities, such as price manipulation, (c) authorizing the financial regulators to supervise, inspect, and sanction VASPs, and to investigate and take appropriate actions against those engaging in unfair trading activities. First, customers deposits should be safely kept at banks, and VASPs need to pay fees to their customers as interest payments on their deposits. VASPs should keep users virtual assets separate from their own virtual assets, and need to actually h
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Jul 11, 2024
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Jul 10, 2024
- FSC Announces Designation of Seven Non-holding Financial Groups for 2024
- The Financial Services Commission held the 13th regular meeting on July 10 and designated seven non-holding financial groups for 2024 pursuant to the Act on the Supervision of Financial Conglomerates (the Act hereinafter). The designated entities are Samsung, Hanwha, Mirae Asset, Kyobo, Hyundai Motor, DB and Daou Kiwoom groups. The designation and supervisory system on non-holding financial groups aims to effectively oversee and manage risk contagion or concentration in financial groups. With the implementation of the Act from June 2021, the FSC has been designating non-holding financial groups every year. The seven selected entities this year satisfied all designation criteria under the Act. The selected entities will be subject to the following rules. a) Select a financial business entity representing the entire group after considering the investment relationship, total size of asset, capital, and so on, and report their selection to the Financial Supervisory Service. b) Periodically inspect and evaluate group-wide risks and prepare and follow their own internal control and risk management policy, and transparently disclose material information needed to ensure consumer protection and report to the authorities. c) Draw up capital adequacy ratio reflecting risk-weighted capital based on the risk assessment conducted by the financial authorities. d) The financial authorities will carry out a periodic assessment (every three years) on the risk and risk management status of non-holding financial groups. It is expect that the designation of non-holding financial groups will help them to more effectively monitor and manage group-wide risks on their own. * Please refer to the attached PDF for details.
