KRX unveils new measures for boosting derivative market

The Korea Exchange said it would introduce two new safety measures to revert mistaken deals in the derivative market in hopes of encouraging potential traders and boosting exchange.Under the first measure, the state-run stock operator will reject orders placed at prices excessively higher or lower than average contract orders starting in September, officials said Thursday. The specific percentage range will depend on the nature of the deals. The new regulation will be applied to KOSPI 200 future

Aug. 28, 2014

Korea to sell W6.7t in state debts in September

South Korea plans to issue state bonds worth about 6.7 trillion won ($6.6 billion) in September, the finance ministry said Thursday.According to the ministry, the government is seeking to sell 1.75 trillion won in three-year Treasurys, 1.6 trillion won in five-year debts and 1.85 trillion won worth of 10-year bonds next month.It also plans to issue 750 billion won worth of bonds that mature in 20 years and 750 billion won in 30-year bonds.The total to be issued is 100 billion less than Treasurys

Aug. 28, 2014

Kookmin Bank cautioned against internal corruption

The South Korean financial watchdog said Thursday it has cautioned troubled Kookmin Bank against a lack of supervision of its employees, which has led to corruption such as massive embezzlement and illegal loans.The Financial Supervisory Service also reprimanded 68 Kookmin Bank officials involved in the scandals. One of the officials was reprimanded in two separate cases.After conducting thorough inspections on the two different cases, the watchdog concluded that 51 employees had pocketed a comb

Aug. 28, 2014

Kookmin Bank takes internal feud over IT to prosecution

Kookmin Bank took the protracted feud over a computation system change to the prosecution, deepening the chasm between the bank and its parent financial group who both have been reprimanded by the watchdog for management fumbles.Kookmin Bank filed a complaint with the prosecution on Tuesday against three executives, including Kim Jae-youl, chief information officer of KB Financial Group Inc., accusing the officials of having underestimated the potential risks of the system change and not promptl

Aug. 27, 2014

Finance minister urges Assembly to pass economic stimulus bills

South Korea’s finance minister on Tuesday called on lawmakers to break the prolonged parliamentary deadlock and “swiftly” pass major economy-related bills to help the government jump-start slowing economic growth.“The pulse in our economy is weakening,” Finance Minister Choi Kyung-hwan said in a joint statement with other key policymakers.“If those bills related to the livelihoods of the people do not pass during this session, and if we fail to revive the embers of economic recovery, the economy

Aug. 26, 2014

Korea hosts global financial regulatory meeting

The Financial Supervisory Service is hosting a regular meeting for the Supervision and Implementation Group, a subcommittee of the Basel Committee on Banking Supervision.The two-day SIG meeting kicked off Tuesday at Westin Chosun Seoul, FSS officials said.The list of participants includes financial supervisory officials from key BCBS member states including the U.S., the U.K., Germany and Japan, as well as senior banking officials from the International Monetary Fund.The core task is to review t

Aug. 26, 2014

Korea’s household credit hits new high in Q2

South Korea’s household credit hit a fresh high in the second quarter, with its growth picking up from three months earlier on a sharp rise in mortgage lending, central bank data showed Tuesday.Household credit totaled 1.04 quadrillion won ($1.02 trillion) as of end-June, up 15.1 trillion won from the previous quarter, according to the Bank of Korea. The second-quarter gain is about four times that of the 3.5 trillion won gain logged in the January-March period.Household credit refers to credit

Aug. 26, 2014

Banking groups diversifying portfolios for profit

South Korea’s leading banking groups are reorganizing their business portfolios to seek new profit sources in response to the prolonged low interest rate trend that has resulted in narrower loan-deposit margins, market watchers said Tuesday. KB Financial Group Inc. expanded its business portfolio by acquiring LIG Insurance Co., the country’s No. 5 nonlife insurer.KB signed a deal to purchase a 19.47 percent stake in the insurer for 685 billion won ($670 million) in late June. The deal is expecte

Aug. 26, 2014

Finance industry union votes for strike

Tens of thousands of unionized South Korean financial workers on Tuesday voted to go on strike next month to protest what they called government interference in the local finance sector.About 100,000 union members from 37 financial companies took part in the vote, with 91 percent of them endorsing the strike scheduled for Sept. 3, their umbrella union Korea Financial Industry Union said in a news release.Ahead of the planned strike, union members plan to hold a protest rally at Yeouido, the coun

Aug. 26, 2014

Financial regulator to tone down punishment to encourage riskier investment

South Korea's top financial regulator said Tuesday it will pull back almost entirely from punishing individuals at financial institutions for missteps, in a move to encourage them to make riskier but potentially lucrative loans to start-ups.The Financial Services Commission said it will cut down on punitive measures against individuals by as much as 90 percent and instead leave disciplinary decisions to companies. It said it will continue to monitor and reprimand institutions for wrongdoing."Exc

Aug. 26, 2014

Korea’s fiscal spending outperforms target

South Korea has executed nearly 64 percent of its annual fiscal spending budget so far this year, better than its target, the finance ministry said Monday.According to the ministry, the government had carried out 191.1 trillion won ($187.5 billion) worth of fiscal spending projects as of July, or 63.8 percent of its planned spending. The ratio is higher than its target of 63.2 percent. “We have achieved the target thanks to aggressive efforts by the government and state-run organizations,” the m

Aug. 25, 2014

S&P to hold annual meeting in Korea this week

Global credit appraiser Standard & Poor’s will hold its annual meeting with South Korean policymakers this week to assess the country’s economy and its credit status, the Finance Ministry said Monday.A delegation led by Kim Eng Tan, head of S&P’s Sovereign Ratings Asia Pacific, will be in Korea for the three-day meeting that will begin Tuesday, ministry officials said. The team will meet with top policymakers including those from the finance ministry, the Financial Services Commission and the Ba

Aug. 25, 2014

FSS loses face as sanctions misfire

The Financial Supervisory Service’s ambitious plans to drive out two KB chiefs ended anticlimactically after the pair ― KB Financial Group chairman Lim Young-rok and KB Kookmin Bank president Lee Kun-ho ― received light penalties last week. The nation’s top financial watchdog now faces a barrage of criticism for issuing empty threats. On Friday, Lim and Lee were given “reprimands” for a high-profile spat over replacing Kookmin Bank’s computing system, and their roles in loan fraud at the bank’s

Aug. 24, 2014

Watchdog backs off heavy punishment for bank heads

 The South Korean financial watchdog on Friday reprimanded the heads of KB Financial Group Inc. and its flagship Kookmin Bank for management failures, concluding an investigation that dragged on for two months with a much lighter punishment than earlier indicated. The Financial Supervisory Service (FSS) said its disciplinary committee gave warnings to KB Financial Chairman Lim Young-rok and Kookmin Bank President Lee Kun-ho, declining to impose heavy penalties that could have forced them to resi

Aug. 22, 2014