South Korea’s Financial Supervisory Service (FSS) has told financial institutions to step up market-stability efforts and forward-looking risk management, while saying it will track margin trading and securities lending and borrowing at brokerages to limit the risk of heavier losses for retail investors during market swings. The regulator also plans to push some financial and insurance companies to reduce asset-liability duration mismatches where solvency pressure may emerge. FSS Governor Lee Chan-jin said financial-market volatility could widen as swings in the Korean stock market intensify, tensions in the Middle East persist, and expectations for further U.S. rate hikes increase. He added that relevant institutions should stay prepared and keep monitoring the operation of the foreign-exchange market’s 24-hour trading mechanism, as well as the funding and operating conditions of financial institutions, according to EToday.
South Korea’s Financial Supervisory Service (FSS) has asked financial institutions to strengthen market-stability measures and forward-looking risk management.
For the stock market, the FSS said it will monitor brokerages’ margin trading and securities lending and borrowing activity to prevent market swings from leading to larger losses for retail investors.
The regulator also plans to push some financial and insurance companies to reduce asset-liability duration mismatch risks where solvency pressure may arise.
FSS Governor Lee Chan-jin said financial-market volatility could expand as fluctuations in the Korean stock market intensify, tensions in the Middle East remain elevated, and expectations for additional U.S. rate hikes gain traction. He said relevant institutions need to be fully prepared and continue to monitor the operation of the foreign-exchange market’s 24-hour trading mechanism, along with the funding and operating conditions of financial institutions.
EToday was cited as the source of the report.
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