KOREA CAPITAL MARKET INSTITUTE

Low growth and population ageing posed fundamental changes in the business environment for Korea’s securities industry. In response, the industry has diversified business models, e.g., building capacity for investment banking, and new product development. However, new business models increased the size of risk the industry should bear, and necessitated regulatory reform to enable securities firms to better use their capital. 

Because the current NCR regulation was introduced right after the Asian financial crisis, it induces securities firms to hold excessive levels of idle capital. Under such a regime, securities companies cannot serve an intermediary function through risky investments. 

To address this, Korea Capital Market sponsored by the Financial Services Commission and the Financial Supervisory Service will host a public hearing titled “Improvements to NCR Regulation to Facilitate the Securities Industry”.