South Korea’s financial regulator will come up with measures within this year to promote mergers and acquisitions of local brokerage houses that have been put up for sale, officials said Sunday.

About 10 brokerage houses, including I’M Investment & Securities Co., Golden Bridge Investment & Securities Co. and Tongyang Securities Co., have been put up for sale in the local M&A market, but any deal has not been made due to the sluggish stock market.

“The government is pushing to offer incentives to encourage investors to buy the brokerage houses as the M&A market has been in the doldrums,” an official at the Financial Services Commission said on condition of anonymity.

Industry sources predict that the streamlined licensing procedure and tax incentives for the newly set up securities via the M&A may be included in the government’s proposed measures.

“The government is considering various measures, but it would be difficult for them to include tax incentives,” the official said.

The regulator is also seeking to shift small- and mid-sized securities firms’ businesses into specialized sectors such as asset management or corporate financing.

As part of efforts to prop up the sluggish stock market, the FSC announced measures to reinvigorate local brokerage houses’ businesses in May and designated five big securities companies as investment banks in October.

Despite the regulator’s desperate efforts, the local market has been bearish due to the protracted economic downturn. (Yonhap News)