Cancellation of Lime Asset Management Registration... Fine of 950 Million Won Imposed

Order to Transfer Fund to Bridge Operator

[Asia Economy Reporter Minji Lee] On the 2nd, the Financial Services Commission announced that it has decided to cancel the financial investment business registration of Lime Asset Management, which caused a fund redemption crisis worth about 1.7 trillion KRW.

On this day, the FSC resolved to cancel Lime Asset Management's financial investment business registration based on the Capital Markets Act and other related laws. The FSC stated, "The Financial Supervisory Service's inspection of Lime Asset Management confirmed numerous illegal activities and improper fund management," adding, "Due to illegal and improper fund management, large-scale repayment and redemption delays occurred, causing investor damage."

Among Lime Asset Management's funds, 173 funds (sub-funds) with a total scale of 1.7 trillion KRW have had repayments or redemptions delayed. Additionally, the FSC imposed a fine of 950 million KRW on Lime Asset Management and decided on measures such as suspension or dismissal of executives and employees based on the grounds of violations.

Furthermore, the FSC ordered that all funds (215 in total) managed by Lime Asset Management be transferred to Wellbridge Asset Management Co., Ltd., a bridge management company jointly established by Lime fund distributors. It also resolved to appoint a liquidator recommended to the court to facilitate the smooth liquidation of the dissolving Lime Asset Management.

The FSC explained, "After the cancellation of registration and until the court appoints a liquidator, the Financial Supervisory Service will maintain resident inspectors and closely supervise the liquidation process," and added, "We will supervise to ensure that the funds transferred to Wellbridge Asset Management are properly managed in accordance with laws and regulations."

Meanwhile, the FSC also canceled the collective investment business license and the professional private collective investment business registration of Monolith Asset Management, which failed to meet the minimum operating capital requirement. Last year, the FSC issued a management improvement order to Monolith Asset Management but judged that timely corrective measures were not met. As of the end of July, Monolith Asset Management's equity capital was 830 million KRW, falling short of the minimum operating capital of 1.43 billion KRW.