"Money Move Acceleration" Securities Firms' ISA Subscribers Surge to 800,000 in 5 Months

Proportion of Securities Firm ISA Subscribers at 48%
820,000 Bank ISA Subscribers Withdrawn

[Asia Economy Reporter Minji Lee] The number of subscribers to securities firms' Individual Savings Accounts (ISA) has increased by 800,000 in five months, nearing 1 million. This is attributed to the launch of the 'Brokerage-type ISA' in February, which allows investment in stocks, prompting bank ISA subscribers to switch to securities firms.

According to the Korea Financial Investment Association on the 1st, as of the end of June, the total number of ISA subscribers across banks, securities firms, and insurance companies was approximately 1.945 million, with 16 securities firms accounting for 954,000 subscribers (48.5%). This is only about 40,000 fewer than the 990,000 subscribers (51.1%) at 14 banks.

Until January this year, securities firms had only about 158,000 ISA subscribers, less than one-tenth of the banks' 1.82 million. However, over the past five months, the number of securities firm ISA subscribers surged by 792,000, while bank subscribers decreased by approximately 826,000, significantly narrowing the gap between the two sectors. This shift is attributed to the ability to invest in stocks through securities firms' ISA since February, leading many bank subscribers to move to securities firms.

ISA is an account that allows management of various financial products in one account and is divided into 'discretionary type,' where experts manage the investments, and 'trust type' and 'brokerage type,' where individuals select products. Since its first launch in 2016, ISA allowed investment in funds or ETFs (Exchange-Traded Funds) but not in stocks, limited to the discretionary and trust types. However, with the introduction of the 'brokerage-type ISA' in February, which permits investment in domestically listed stocks, investor migration has accelerated.

As the number of subscribers increased, the investment balance also showed growth. The total ISA balance rose from 6.8307 trillion won at the end of January to 8.4165 trillion won at the end of June, an increase of 1.6 trillion won. Despite a significant decrease in bank subscribers, the bank balance increased from 5.9 trillion won to 6.5 trillion won, while securities firms' balance grew from 838.1 billion won to 1.8197 trillion won.