S. Korean companies brace for liquidity crisis in April

South Korean companies are bracing for a possible liquidity crisis in the bond market next month, amid sagging investor sentiment and signs of capital flight due to the coronavirus pandemic, market data showed Sunday. The illiquidity -- triggered by continuously escalating novel coronavirus fears -- will pose a hurdle to companies when they attract new capital or carry out a refinancing scheme. A combined 6.5 trillion won ($5.2 billion) in corporate bonds is due to reach maturity in April, ac

March 22, 2020

Foreign brokerages suffer big hit amid price-cutting race

Foreign brokerages operating in South Korea have reported a drastic fall in their earnings in 2019, with their commission income falling sharply as domestic rivals chewed on their market share. The five securities arms of foreign investment banks -- Credit Agricole, BNP Paribas, Deutsche, Hong Kong and Shanghai Banking Corp. and UBS -- disclosed that they saw over a 30 percent drop in their annual earnings, according to the Korea Financial Investment Association. The latest was France-based C

March 22, 2020

Hankuk Paper signs W55b deal to acquire local paper maker Seha

An investor group led by South Korean pulp product manufacturer Hankuk Paper agreed to buy a majority stake in Korea’s third-largest domestic industrial paper maker, Seha, for 55 billion won ($44.2 million) from Korean nonperforming loan manager United Asset Management Co., a filing showed Sunday. This marks the private bad bank’s first exit from a distressed buyout strategy that traces back to 2014. The consortium -- comprising Hankuk Paper and Daesung Industrial -- will acquire

March 22, 2020

Shinhan Investment CEO steps down over Lime scandal, derivatives misselling

Shinhan Investment CEO Kim Byung-cheol resigned on Friday, taking responsibility for the brokerage’s role as a key sales channel for now-frozen Lime Asset funds and derivatives that caused huge losses for investors. “In order for the company to win back customer trust and get back on track to normalize business, it would be right for me to take responsibility and step down,” Kim said during the company’s board meeting, according to Shinhan. “I have been delayin

March 20, 2020

Officials, experts divided over impact of S. Korea-US currency swap deal

While the financial authorities on Friday welcomed the $60 billion bilateral currency swap deal signed between South Korea and the US the previous day, some experts voiced concern that it may be too soon to rejoice because it is not yet clear what impact it will have on the market. The deal is the first of its kind since the 2008 global financial crisis and will remain in effect for six months, unless both parties decide to extend. “The $60 billion Korea-US bilateral currency swap wil

March 20, 2020

Seoul stocks rebound 7% on currency swap deal with US

South Korean stocks rebounded sharply on Friday as investors were buoyed by the currency swap deal between Seoul and Washington, snapping a freefall of seven consecutive sessions. The Korean won was also sharply up against the US dollar. The benchmark Korea Composite Stock Price Index soared 108.51 points, or 7.44 percent, to close at 1,566.17. Trading volume was high at 807 million shares worth 10.4 trillion won ($8.41 billion), with gainers far outpacing losers 824 to 68. The combined marke

March 20, 2020

Bidding war for Prudential Life intensifies amid coronavirus risks

An intense bidding war for the takeover of Prudential Life Insurance of Korea, valued at some 2 trillion won ($1.6 billion), kicked off early Thursday as major banking groups and private equity houses vied to get their hands on the insurer. The bid for a 100 percent stake in the insurer came as the risks stemming from the novel coronavirus compounded those from the Bank of Korea’s latest rate cut. Those risks have slowed the momentum for the bid, which could be the largest acquisition d

March 19, 2020

NPS to vote against chiefs of Shinhan, Woori, Hyosung

The National Pension Service, South Korea’s public pension fund, said Thursday it would disapprove of the chiefs of Shinhan Financial Group, Woori Financial Group and Hyosung as board directors in their respective shareholders meetings in March. The decisions came as the pension fund overseeing 736.7 trillion won ($576.7 billion) has moved to ramp up shareholder activism and exercise its voting power to keep large corporations in check as a minority shareholder. The NPS’ nine-membe

March 19, 2020

[Exclusive] Foreign residents still locked out of online banks

Concerns about the fast-spreading novel coronavirus are fueling growing demand for “untact banking,” but foreign residents in South Korea still cannot subscribe to online banking services, due to the lack of a verification system. Untact banking refers to online or mobile banking services without physical contact between bank staff and customers.  Online-only banks, which have been in Korea since 2015, allow a totally contactless service, but regulatory issues meant that the

March 19, 2020

Kospi plummets below 1,500, lowest in 11 years

  South Korean stocks crumbled again Thursday, hitting the lowest point in nearly 11 years, as foreigners’ selling spree continued over growing global uncertainties. The benchmark Kospi closed at 1,457.64 -- down 133.56 points, or 8.39 percent, from the previous session. It marked the lowest closing price since July 23, 2009, at 1,496.49 points. The tech-heavy Kosdaq also crashed by 56.79 points, or 11.71 percent, to close at 428.35. It recorded the lowest closing since Oct. 5, 2011,

March 19, 2020

Korean firms rush for audit lifeline amid coronavirus spread

South Korea’s financial regulator said Thursday that 69 domestic companies have sought audit relief due to shortcomings in their reports for 2019, as the novel coronavirus has undermined their key operations, especially in China. Over two-thirds of companies that have applied for regulatory relief have a presence in China, and determined their filings cannot be completed by March 30, according to the Financial Services Commission. They include tobacco product maker KT&G, light bulb ma

March 19, 2020

Foreigners sell stocks in S. Korea and other emerging markets

Foreign investors have sold a large sum of stocks in South Korea and other emerging markets largely due to concerns over the coronavirus pandemic, data showed Thursday. Offshore investors sold a net $5.8 billion worth of South Korean stocks in the first two weeks of March, according to data by brokerage Yuanta Securities Co. In comparison, foreign investors sold a net $6.7 billion worth of Taiwanese stocks during the cited period, followed by Indian stocks worth $3.8 billion and Brazilian stoc

March 19, 2020

Gold funds lose luster on coronavirus scare

Gold funds in South Korea have posted dismal returns over the past month amid falling gold prices due to the coronavirus scare, data showed Thursday. Local gold funds with assets of 1 billion won ($796,000) or more registered an average return of minus 12.45 percent over the last one-month period, according to the data from FnGuide. They outperformed stock investment funds over the cited period, but the performance failed to live up to expectations, given the metal's nature as a traditional s

March 19, 2020

Viva Republica inches closer to launching brokerage service

Fintech platform operator Viva Republica said Wednesday that it has received preliminary approval to run a stock trading business from the nation’s financial watchdog, the Financial Services Commission. In order to run the stock business in a safe and stable manner, the company, which runs peer-to-peer money transfer app Toss, will beef up workforce and upgrade systems in the coming months before receiving final approval from the financial authority, the Seoul-based financial technolog

March 18, 2020

Kospi dips below 1,600-point mark, lowest since May 2010

South Korean stocks crashed further Wednesday, hitting the lowest point in a decade, as the novel coronavirus panic spread despite stimulus packages released around the globe. The benchmark Kospi opened slightly higher at 1,686.12 -- up 13.68 points, or 0.82 percent, from the previous session. The index, however, slipped throughout the day and suddenly plunged in the afternoon, closing at 1,591.2. It marked the lowest closing price since May 26, 2010, at 1,582.12 points. Offshore investors o

March 18, 2020

‘Proxy advisers KCGS and ISS have lost objectivity on Hanjin’

Major shareholders of logistics giant Hanjin KAL on Wednesday rebelled against proxy advisory firms Korea Corporate Governance Service and Institutional Shareholder Service for their decision to support the extension of Chairman Cho Won-tae’s term. The group consists of his elder sister and former Korean Air Vice President Cho Hyun-ah, KCGI -- local activist fund, Hanjin’s biggest shareholder with 18.68 percent stake -- and construction firm Bando Construction. “The latest d

March 18, 2020

Coronavirus fears dent corporate bond deals

Coronavirus fears in the financial market are quashing bond investors’ appetite for investment-grade bonds issued by South Korean companies, dragging on their plans to raise capital. From Friday to Wednesday, all corporate bonds of three companies were undersubscribed in the respective institutional tranches in Korea. This stems from the bond price hike along with monetary easing stance at home and abroad. Bond yields, which move inversely with bond prices, were on a downtrend in Kore

March 18, 2020

Apartment price gap in Seoul widens

  The price gap between apartments in areas south and north of the Han River has increasingly widened last month, data showed Wednesday.  In February, the average price per pyeong (3.31 square meters) for apartments in 11 areas of Gangnam-gu, southern Seoul surpassed 40 million won ($32,372) while apartments in 14 areas in Gangbuk-gu, northern Seoul, recorded 27 million won ($21,851), according to data released by real estate information provider 10000-lab.  The apartment pric

March 18, 2020

Banking groups under profit pressure by rate cut

South Korea’s major banking groups are operating under emergency systems to deal with impact by the central bank’s record-low key rate on the financial and forex markets. The current 0.75 percent interest rate has been putting pressure on the commercial banks’ profit margins, analysts say, which in turn is likely to affect related stock prices amid the general shareholders meeting season this month. Commercial banks are the flagship business units of banking groups here. &l

March 18, 2020

Seoul stocks lose earlier gains late Wednesday morning

South Korean stocks returned to negative terrain late Wednesday morning, offsetting earlier gains from the opening bell as foreigners and institutions both became net sellers. The benchmark Korea Composite Stock Price Index (KOSPI) had fallen 6.61 points, or 0.4 percent, to 1,665.83 as of 11:20 a.m. The market earlier rebounded as investors welcomed a set of additional stimulus packages being considered by the United States. Washington announced Tuesday (local time) it is considering a stimul

March 18, 2020