Chairman Kim Juhyun: "Prompt Implementation of Regulatory Improvements Related to Financial Sector Fund Management"

On the morning of the 25th, Kim Ju-hyun, Chairman of the Financial Services Commission, held a meeting to review the current status of the financial market at the Government Seoul Office in Jongno-gu, Seoul. He discussed with executives the financial market trends following the previous day's base rate hike by the Monetary Policy Committee, as well as key risk factors for the financial market at the end and beginning of the year and measures to respond to them.

[Asia Economy Reporter Song Hwajeong] Kim Joo-hyun, Chairman of the Financial Services Commission, has instructed to promptly review and immediately implement regulatory improvements related to fund management to support the financial sector's efforts to stabilize the market.

On the 25th, the Financial Services Commission held a meeting to review the current financial market status, chaired by Chairman Kim Joo-hyun along with senior officials of the FSC, to assess financial market trends and major risk factors at the end and beginning of the year following the previous day's base rate hike by the Monetary Policy Committee.

At the meeting, it was evaluated that the recent domestic money market is somewhat calming down due to expectations of a slowdown in domestic and foreign monetary tightening and the implementation of consecutive market stabilization measures. They agreed to proactively prepare and respond to various domestic and international risk factors that could affect the financial market at year-end and early next year to prevent the spread of market instability.

Chairman Kim emphasized, "Considering special fund situations such as year-end settlements and the December Federal Open Market Committee (FOMC), it is necessary to maintain vigilance and continue efforts to stabilize the market until the end of the year, and even add to them if needed." He also requested a thorough pre-assessment and timely response to micro and individual events that could impact the financial market, such as concerns over excessive competition in the retirement pension market at year-end.

Additionally, Chairman Kim urged strengthening communication with the financial sector to ensure that the 95 trillion won liquidity support from the five major financial holding companies leads to actual stabilization of the money market. He instructed to promptly review and immediately implement regulatory improvements, official interpretations, and non-action opinions related to fund management, which the financial sector has proposed so far, in cooperation with the Financial Supervisory Service to support the financial sector's market stabilization efforts.

According to the FSC, the bond market stabilization fund is currently supporting corporate commercial papers (CP) and asset-backed securities (ABS), and the matching ratio for purchase support has been relaxed to achieve early market stabilization. The Korea Development Bank, Industrial Bank of Korea, and Korea Credit Guarantee Fund's corporate bond and CP purchase programs, securities firms' CP purchases, and liquidity support for securities firms through Korea Securities Finance are progressing without issues. The securities firms' guaranteed project financing (PF)-asset-backed commercial paper (ABCP) purchase program (totaling 1.8 trillion won) began purchasing about 300 billion won on the 24th. The construction company guaranteed PF-ABCP purchase program (totaling 1 trillion won) is also being operated with relaxed purchase criteria based on requests from construction companies during the demand survey process, and actual purchases are scheduled to begin next week.