FSC Holds Market Monitoring Meeting (Dec. 4)

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FSC Holds Market Monitoring Meeting (Dec. 4)
Dec 04, 2024

Chairman Kim Byoung Hwan of the Financial Services Commission convened a meeting on December 4 with officials from related authorities, financial institutions, and industry groups to check market situations and discuss response measures. The following is a summary of Chairman Kim’s opening remarks.

A Summary of Chairman’s Remarks

Currently, the situation surrounding the foreign exchange market and overseas-listed stocks of Korean companies appear to be stabilizing.

However, as there are concerns about a potential rise in volatility, financial authorities will utilize all available measures to prevent the spread of market anxiety and ensure a seamless and stable operation of financial markets in close coordination with policy financial institutions, related organizations, and industry groups.

At the Emergency Meeting on Macroeconomic and Financial Issues (F4 Meeting) held earlier this morning, authorities decided to ensure the supply of unlimited liquidity support until the conditions return to normal in the financial markets. The measures include stock market stabilization fund in the amount of KRW10 trillion, bond market stabilization fund in the amount of KRW40 trillion, and the corporate bond and commercial paper (CP) purchase program all aimed ensuring market stability.

At the same time, authorities will closely monitor financial companies’ foreign currency liquidity conditions to ensure their soundness, while supplying foreign currency liquidity through the Korea Securities Finance Corporation to prevent the risk of margin call emanating from a potential weakening of the Korean won.

In responding to market situations, each organization is asked to strictly follow its own contingency plan.

In this regard, policy financial institutions are asked to mobilize all available resources to ensure an active and flexible supply of funds to make sure that vulnerable groups, small merchants, and businesses face no challenges in meeting their financing needs.

The stock market operator and related organizations need to make efforts to ensure calmness in investment sentiment, while focusing on the prevention of market disturbing behaviors, such as stock price manipulation, unfaithful disclosure, price rigging, and so on.

All financial industry groups are also asked to actively encourage financial companies to thoroughly review potential risks and make efforts to bolster soundness and the foreign currency liquidity conditions.

Since even a small accident can heighten market anxiety in highly volatile market conditions, financial companies are urged to thoroughly check their own internal control mechanisms to make sure that there are no financial accidents or security breaches.

The Financial Security Institute, in particular, is asked to conduct a comprehensive review on all financial sectors’ computer network systems to ensure that there is no blind spot in ensuring security in the financial system.

The government and relevant organizations will continue to maintain a real-time market monitoring system and take steps to promptly employ market stabilization measures when it becomes necessary.

• Please refer to the attached PDF for details.

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