KOREA CAPITAL MARKET INSTITUTE

At the wake of the global financial crisis, global capital markets including Korea’s have faced a rapidly changing environment amid tightened investment banking regulation and the rise of IT-based finance. For several years, Korea’s securities industry has observed their business profitability deteriorate, and concerns are mounting that the industry’s lackluster performance may be not so much a short-term condition as a structural phenomenon under the new capital market environment. Against the backdrop, the securities industry has pondered upon new revenue sources while still failing to move away from the brokerage-based business model.

The securities industry intermediates capital market transactions such as corporate financing deals and aggressively take and alter risks for product diversity, and thus plays a crucial role as vital as blood vessels in the national economy. In this vein, improving the industry’s growth and profitability for making such risk-taking sustainable is all the more critical. However, faced by the deepened price competition, Korea’s securities industry failed to secure sufficient profitability for developing their risk-takin capacity. And admittedly, Korea’s solvency regulation lacks consideration from that perspective.

To provide an opportunity for debates on key issues such as a renewed competition structure for profitability improvement in Korea’s securities industry, and new solvency regulation for bringing new dynamics in the industry, the Korean Securities Association and Korea Capital Market Institute will jointly host a policy symposium.