From July, Forex Trading Extended Until 2 AM... Financial Supervisory Service "Same-Day Accounting Processing"

Financial Supervisory Service Revises Banking Supervision Enforcement Rules and Related Regulations

Starting in July, as the foreign exchange market trading hours are extended until 2 a.m. the next day, the Financial Supervisory Service (FSS) has decided to allow foreign exchange transactions conducted during the early morning hours to be accounted for as same-day transactions.

On the 28th, the FSS announced that it will revise the "Banking Supervision Regulations" and the "Financial Investment Business Regulations" to improve operational efficiency following the extension of foreign exchange market trading hours. It also plans to prepare accounting-related guidelines and implement follow-up measures.

Previously, the foreign exchange authorities decided to extend the trading hours of the foreign exchange market from the previous 9 a.m. to 3:30 p.m. schedule to 9 a.m. to 2 a.m. the next day. After a pilot operation, this will be officially applied starting in July. Until now, participants in the foreign exchange market such as banks expressed concerns about uncertainty due to the lack of clear accounting standards.

In response, the FSS established clear standards allowing foreign exchange transactions conducted from midnight to 2 a.m. the next day (T+1) to be accounted for as same-day (T) transactions to ensure international consistency and operational efficiency. Going forward, the closing time for foreign exchange transactions can be autonomously set by each company before the start of business the next day, depending on factors such as the currency traded and the counterparty. However, customer transactions such as weekday interest calculations must be based on the calendar date.

Lim Jong-geon, Director at the FSS, stated, "Foreign exchange market participants such as banks can autonomously determine the closing time for same-day foreign exchange transactions according to their circumstances, including traded currencies, counterparties, and transaction volumes by time zone, which is expected to enhance operational efficiency and facilitate smooth foreign exchange transactions during early morning hours." He added, "We will continue to maintain close cooperation with foreign exchange authorities and market participants to ensure the successful implementation of foreign exchange market structural improvements and actively provide necessary support."