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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 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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Dec 23, 2019
- FSC Reforms Non-Face-to-Face Customer ID Guidelines for Corporations and Foreigners
- The Financial Services Commission unveiled a revised guideline for non-face-to-face customer identification on December 20, which is aimed at promoting online financial transactions by corporations and foreigners.BACKGROUNDThe non-face-to-face customer identification was first introduced to the banking sector in December 2015 for the purpose of improving consumer convenience. It was a major shift from the face-to-face identification method which had been in place for more than 20 years since the implementation of the real name financial transactions in August 1993. In February 2016, the non-face-to-face identification expanded to the non-banking sector (e.g. financial investment business and mutual banks).In January 2017, the FSC allowed corporations to open a new bank account though non-face-to-face customer identification; however, for corporations, only one representative could be identified through non-face-to-face identification method to prevent financial crimes, such as identify theft.Since its introduction, the number of new bank accounts opened through non-face-to-face customer identification has continued to increase. CHANGESFor corporations, opening a new corporate bank account by legal representatives, such as an employee or a board member, through non-face-to-face customer identification will be permitted. Legal representatives must present a power of attorney to financial companies for verification purposes.For foreigners, the alien registration card may be used to verify identity when opening a new bank account through non-face-to-face customer identification.SCHEDULEThe changes will go into effect on January 1, 2020, although each financial institution will determine whether and when to adopt non-face-to-face customer identification service for corporations. In January 2020, banks and financial investment sectors will draw up operational guidance in that regard.* Please refer to the attached PDF for details.
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Dec 19, 2019
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Dec 04, 2019
- Measures to Promote Fintech Scale-ups
- The FSC announced measures to promote fintech scale-ups on December 4, which includes 24 key tasks in 8 different policy areas.BACKGROUNDThe government has been promoting the fintech industry as part of its innovation-led growth strategy amid digital transformation and the 4th industrial revolution. To this end, the government has introduced a financial regulatory sandbox, open banking, regulatory reforms and budget earmarks for fintech. In order to further develop Korea’s fintech industry and its ecosystem, the government plans to implement the following fintech scale-up strategies, which builds upon the progress made so far.KEY MEASURESI. IMPROVING THE CURRENT REGULATORY SANDBOX SYSTEM► Designate more than 100 ‘innovative financial services’ by the end of March 2020, which marks the one-year anniversary of launching the regulatory sandbox► Improve rules and practices in operating the regulatory sandbox: (i) protect innovative ideas and technologies through patents and intellectual property rights (e.g. providing legal counsel or expediting patent dispute resolution); (ii) impose a minimum level of additional requirements on ‘innovative financial services;’ and (iii) grant continuation of designation status through MA► Provide continuous support (e.g. costs on testing, security inspection, office space, etc.) for the entire cycle from designation of ‘innovative financial services’ to commercialization of innovative financial solutions.► Set up a supervisory framework tailored to the promotion of fintech firms – e.g. conducting supervision and inspection aimed at providing counseling or establishing regulatory grounds to grant fintech firms immunity in case of minor violations.II. PERFORMING REGULATORY REFORMS TO FACILITATE FINTECH DEVELOPMENT► Promote a flexible and dynamic regulatory environment where testing of ‘innovative financial services’ can lead to commercialization and ultimately to an improvement in regulatory reforms.► Con
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Nov 06, 2019
- FSC Designates Additional Financial Solutions as 'Innovative Financial Services'
- The FSC designated seven additional financial solutions as ‘innovativefinancial services’ to be accepted into financial regulatory sandbox. As of November6, the FSC has designated a total of 60 such services.Overview of Newly Added ‘InnovativeFinancial Solutions’1. An online-based paperless application solution for business-relatedinsurance products, such as fire or disaster liability insurance (Samsung Fire MarineInsurance)2. An online payment service which allows buyers of used goods topre-charge e-points with their credit cards and transfer e-points to sellers asa means of payment when purchasing used goods directly from the seller in onlinee-commerce platform (KBKookmin Card)3. A monthly wage payment solution which uses mobile location datato log individuals’ work hours and allows workers to receive wages prior to themonthly payday through an escrow account (Emmaus)4. An automated intellectual property report solution which analyzesthe economic value of intellectual properties using big data and artificialintelligence, and forward the information to financial institutions (Wisdomain)56. An alternative credit evaluation service for individuals,business owners and SMEs, which utilizes non-financial information, such as profitrecords, types of business, number of days in operation and so on, to analyzeand provide alternative credit rating system for small businesses (BC Card, KB Kookmin Card)7. A small sum investment platform which allows individualinvestors to trade small amounts in foreign stocks and diversify portfolios (Korea Investment Securities)
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Oct 31, 2019
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Oct 29, 2019
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Jul 18, 2019
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Jun 26, 2019
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May 30, 2019
- FSC Introduces Deregulatory Measures to Boost Korea's Derivatives Market
- The FSC introduced deregulatory measures to make Korea’s derivatives markets more vibrant and competitive. The reforms are intended to strengthen the derivative market’s role for risk hedging and price discovery, as part of the government’s broader efforts to vitalize capital markets and support the real economy.BackgroundKorea’s derivatives trading volume fell sharply from its peak in 2011 but recovered to an extent after 2015 with increased trading of index products.1 Since the introduction of tighter regulations to curb speculative trading in 2011, the derivatives market’s soundness improved with an increase in the number of longer-term open contracts for risk hedging.2By investors, foreigners accounted for 50.4% of derivatives trading in 2018, up from 25.7% in 2011. Over the same period, the share of institutional investors decreased from 48.7% to 36.1%; and retail investors from 25.6% to 13.5%. Excessive entry barriers act as obstacles to retail investors, while strict margin requirements hinder institutional investors’ participation.The derivatives market is disproportionately concentrated in KOSPI200-related products, making it difficult to serve investors’ demand for a variety of derivatives products.Reform Measures► Lower entry barriers for retail investors (Q4 2019/FSC, KRX) Minimum deposit requirement will be abolished for professional investors and eased for non-professional investors: (i) KRW 10million or more for futures and options trading; and (ii) KRW 20million or more for all derivatives trading. One hour of education and three hours of mock trading► Ease margin requirements for institutional investors (Q3 2019/FSC, KRX) Currently, institutional investors are required to deposit an extra margin, 10 % of credit risk limit, in addition to 100% of the volume exceeding the credit limit. The1 Average daily turnover (unit: trillion won): 66.3(2011), 47.9(2013), 37.2(2014), 41.2(2015).45.0(2018)2 KOSPI 200 Futures Open Interest (unit: 10
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Apr 24, 2019
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Jan 23, 2018
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Jun 21, 2017
- FSC Held Market Monitoring Meeting on Results of MSCI 2017 Market Classification Review
- FSC Vice Chairman Jeong Eun-bo held a meeting on June 21 with officials from relevant agencies to discuss the impact of the MSCI’s 2017 Market Classification Review and the government’s responses.INCLUSION OF CHINA A-SHARES INTO MSCI EMERGING MARKET INDEXIn its annual market review, MSCI decided to include China A-shares, 222 large-cap stocks of Chinese companies listed in either Shanghai or Shenzhen, into the MSCI Emerging Market (EM) Index.IMPACT ON KOREA’S FINANCIAL MARKETAs the inclusion of China A-shares increases China’s weighting in the MSCI Emerging Market Index, Korea’s weight in the same index is expected to decrease by 0.23 %p from its current 15.5%. Given the amount of funds tracking MSCI EM Index, which ranges between KRW 250 trillion (USD 230 billion) and KRW 1,900 trillion (USD 1.8 trillion), Korea may experience possible outflow of KRW 600 billion to KRW 4.3 trillion from the equity market.The FSC, however, sees MSCI’s decision will have a limited impact on the Korean stock market for the following reasons:▪ The change will be actually reflected in the MSCI EM Index in a year, from June 2018.▪ The amount of global funds investing in emerging markets continues to increase, recording a net inflow of USD 18.1 billion into emerging markets from April to May 2017.▪ Given that the Korean stock market attracted a net foreign capital inflow of KRW 9 trillionin the first five months this year alone, the amount of possible outflows (max. KRW 4.3 trillion) is not so significant.GOVERNMENT’S RESPONSESThe government will keep monitoring the impact of the MSCI’s decision to include China A-shares into its emerging market index on the Korean equity market. We will also continue our policy efforts to improve global competitiveness and attractiveness of our capital markets, and consultation with MSCI in regard with the inclusion of Korea on the list for potential reclassification to the MSCI Developed Market Index.* Please read the attached file
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Apr 03, 2017
- Korea's 1st Internet-only Bank Open for Service
- ‘K bank’, Korea’s first internet-only bank is officially launched on April 3 for service.At the opening ceremony, Financial Services Commission Chairman Yim Jong-Yong emphasized three significant meanings of the launch of K bank. First, K bank has already brought about a new wave of competition in the banking sector. Second, financial consumers will be able to enjoy numerous benefits including lower banking transaction cost, more convenient banking services, and easier access to loans compared to those provided by commercial banks. Third, more descent quality jobs will be created in the banking, IT, and fintech sectors.K bank will supply mid-interest rate loans worth KRW 500 billion for the next three years. It will start with providing retail banking services and its business scope will be widened to include mortgage loan, payment services, foreign exchange, and fund sales in time.K bank acquired preliminary approval for banking business in November 2015, and final approval in December 2016.*Please refer tothe attachedPDF for details.
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Mar 12, 2017
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Nov 22, 2016
- Measures for Improvement of Derivatives Markets
- The FSC announced a set of measures to make South Korea’s derivatives markets more advanced and sounder as this year marks the 20th anniversary of the establishment of derivatives markets in 1996. Key Points EXCHANGE-TRADED DERIVATIVES MARKETTo boost derivatives trading and enhance diversity of derivatives in the market, improvements will be made on both supply and demand sides. - Supply side: simplification of listing procedures, diversification of derivatives, adjustment of trading units for KOSPI200 futures and options - Demand side: flexible requirements for investors, introduction of the ‘omnibus account’ for foreign investors OVER-THE-COUNTER(OTC) DERIVATIVES MARKETRisk management system will be established with the introduction of global regulatory standards such as margin requirements for non-centrally cleared derivatives and electronic trading platforms. DERIVATIVE-LINKED SECURITIES MARKETThe FSC will strengthen risk management and investor protection, while pursuing more diversification of products to meet various investment needs. - For ELS DLS markets, stress tests will be conducted on regular basis to strengthen risk management of securities firms. To enhance transparency in fund management, assets of ELS issuance and management will be separately managed. - Investor protection will be strengthened in ELS DLS markets with the introduction of tougher “Know-your-Product Rule” and a “cooling-off period” for investors. - Development and listings of more derivatives-linked products will be promoted as alternatives to ELS products. Detailed Measures1. EXCHANGE-TRADED DERIVATIVES MARKET Supply Side(1) Simplification of listing procedures Listings of derivatives linked to new underlying assets, which currently requires the FSC’s approval, will be streamlined. Relevant rules will be revised to allow the KRX to decide on the listings of new derivative products, while the FSC will only approve the scope of the underlying assets. (2) Di
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Nov 09, 2016
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Nov 07, 2016
- FSC Holds Emergency Meeting on Financial Markets
- FSC Chairman Yim Jong-Yong convened an emergency meeting with top officials from the FSS and other relevant financial organizations to respond to recent uncertainties in financial markets at home and abroad. Followings are key messages from his opening remark: The Korean economy is now facing internal and external challenges with slump in exports; slow recovery in domestic consumption; and household and corporate debt risks. However, our economy has sound fiscal health and strong fundamentals to weather these challenges. The government maintains fiscal soundness with its debt-to-GDP ratio of 35.5% at the end of 2015, which is the 4th lowest among 31 OECD countries. South Korea has the world’s 7th largest foreign currency reserve. Its short-term external debt accounts for only 29% of the foreign currency reserve, as of the 2nd quarter of 2016, which is much lower than 74% at the end of 2008. The financial system is resilient enough in terms with capital adequacy and asset soundness of financial institutions. The government will stay alert to internal and external uncertainties and take bold and preemptive measures, if necessary, to prevent any of risk factors from spilling over into a wider financial system to threaten our economy. Starting from today, the FSC and the FSS go into an emergency operation mode with a 24-hour monitoring on financial markets, in a close cooperation with the Ministry of Strategy and Finance, and the Bank of Korea. If necessary, we will take market stabilizing measures in accordance with contingency plans in a timely manner. We will continue to respond to household and corporate debt risks in a preemptive manner. For household debt, the government will continue our effort to improve soundness of household debt by holding the principle of ‘debt should be borrowed within repayment ability and paid back in installments.’ We will also closely monitor and respond to rapid growth of household debt in non-banking sectors. For ong
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Aug 02, 2016
