Major financial indices recorded limited volatility Monday, despite growing worries over negative effects on the stock and foreign exchange markets from geopolitical tensions on the Korean Peninsula.The movements of stock prices and foreign exchange rates Monday drew wide interest as South Korean and U.S. troops launched their annual joint drills earlier in the day.Though stocks fell below the 1,990 mark and the U.S. dollar was traded above 1,100 won during the morning trading session, the two m

March 11, 2013

Local financial policymakers said that the stock and foreign exchange markets may be swayed by the recent situation involving the intentional community’s disciplinary measures against North Korea.As the U.N. Security Council decided to impose additional sanctions Thursday on North Korea for its Feb. 12 nuclear test, Korea’s financial regulators and economic policymakers have embarked on closer monitoring of the financial market.Though provocative actions from the North had minimal impact on the

March 8, 2013

Commercial banks saw the delinquency rate on loans collateralized by apartments climb to the highest level in more than six years, regulatory data showed Thursday.According to the Financial Supervisory Service, the delinquent mortgage loan ratio was 0.94 percent in January, compared with 0.74 percent a month earlier and 0.69 percent a year earlier.Rising sharply to 0.94 percent, last recorded in October 2012, it marked the highest rate in 76 months since the sourced loan ratio reached 1.03 perce

March 7, 2013

Tongyang Life Insurance said Wednesday that it intended to bid for ING Life Korea, heralding close competition with powerful investors such as Hanwha Life and Kyobo Life.In its regulatory filing on the Korea Exchange, Tongyang Life clarified that it was “considering participating in the coming bidding to take over ING Life Korea, as part of our strategic viewpoint.”The firm’s business policy on the mergers and acquisition market came several weeks after the nation’s No. 2 (Hanwha) and No. 3 (Kyo

March 6, 2013

The Financial Supervisory Service said Tuesday that it has issued an “institutional warning” against Korea Exchange Bank for raising interest rates on loans to the corporate sector via “irregular practices.”Its irregular rate hikes were mostly conducted when U.S.-based Lone Star Funds was holding the majority stake in the commercial bank as the biggest shareholder.“Glossing over lending terms, KEB raised the rates on loans to small- and mid-sized enterprises. The hikes ranged between 0.2 percent

March 5, 2013

Korean listed companies’ ability to pay back their debt has deteriorated due to their worsening profitability amid slowing economic conditions.Based on a 2012 assessment of firms listed on the stock market, Woori Finance Research Institute said Tuesday that 15 percent, or 180 out of 1,200 firms, were found to earn less than the amount they have to pay in debt interest.The 180 firms posted an average interest coverage ratio ― a firm’s operating profit divided by its interest costs ― of less than

March 5, 2013

Financial regulators have decided to slap fines of up to 260 million won ($240,000) on the Korean unit of American International Assurance for business irregularities, industry sources said Monday.The sources said the firm’s irregular business practices included the “overcharge of insurance premiums” worth about 2.8 billion won for more than 1 million cases.AIA Life, or AIA Group Limited Korea and formerly AIG Life, had stipulated that it would offer a 2 percent discount for payment of premiums

March 4, 2013

Three life insurance firms are suspected of engaging in irregular accounting practices involving promotion expenses for their “bancassurance” business, industry sources said Sunday.The three firms are Hanwha Life (formerly Korea Life), Tongyang Life and Mirae Asset Life, according to sources and the Financial Supervisory Service.An FSS official said that the regulator recently issued sanctions, such as “reprimands” and “cautions,” against 12 executives and employees of the three insurance firms

March 3, 2013

The securities industry recorded worse-than-expected earnings during the October-December 2012 period amid a sharp drop in stock brokerage fees collected in the ongoing economic slowdown.Further, some major brokerage firms saw their performance fall into “deficit,” industry and Financial Supervisory Service data showed Thursday. Among them are Hyundai Securities, Daishin Securities and IBK Investment & Securities.Hyundai Securities, a subsidiary of Hyundai Group, is noted as one of the nation’s

Feb. 28, 2013

The nonlife insurance industry said Wednesday that it has launched a project to induce a cut in repair costs for import cars.Dealers of import cars have long been under criticism for not publicizing prices of auto components. As a result, consumers and insurance firms had to bear quite high expenses for car repair.Since early January, the General Insurance Association of Korea ― in coordination with automobile (or nonlife) insurance firms ― has been looking into the optimum level of auto parts a

Feb. 27, 2013

Local chaebol and financial groups are engaging in another round of heated competition in the saturated credit card market.The excessive rivalry between the conglomerates and the banking groups over the money-spinning business stemmed from a credit card fiasco about 10 years ago.The 2003 woes from the reckless doling-out of credit cards led to a record-high number of credit defaulters and the downfall of then-No. 1 issuer LG Card.The latest competition looms large between the card units of Samsu

Feb. 26, 2013

The controversial policy direction toward achieving a fairer market has come under the spotlight again, as President Park Geun-hye referenced “economic democratization” during her inaugural speech Monday.The term of economic democratization, aimed at weeding out unfair practices of big enterprises, was not included in the list of five major policy goals unveiled by the Park government last week.While opposition parties and civic groups criticized Park for omitting her campaign pledge from the li

Feb. 25, 2013