South Korea’s top financial regulator said Thursday it will push ahead with the second phase of financial reforms aimed at expanding a range of new services and sharpening the competitive edge.
Financial Services Commission chairman Yim Jong-yong (Yonhap)
The Financial Services Commission said it has mapped out the plan to reorganize listing procedures and the public subscription system in stock markets to facilitate better access to finance for Korean companies on the heels of last year’s reforms that focused on eliminating regulatory hurdles and outdated practices.
“Through last year’s measures, there have been signs of changes, but the reforms are still incomplete. We will carry out the second phase in a consistent manner,” FSC chairman Yim Jong-yong said.
To encourage more firms to go public, the regulator said it will diversify listing rules to evaluate the firms’ growth potential rather than focusing on their financial conditions as a qualification for an initial public offering.
Yim said the government will seek new growth engines for the finance industry by supporting overseas expansions of financial institutions and financial technology enterprises.
He also stressed the importance of expansion of the merit-based pay system in state-run banks, as opposed to seniority-based pay, to encourage other commercial lenders to follow suit.
“By implementing the corporate governance code for financial companies, which will be effective in August, the companies’ transparency and soundness will improve,” Yim said.
The FSC also pledged to enhance the registration system for financial products and make it easier for consumers to understand products.
“To minimize the inconvenience to consumers, descriptions on financial products will get easier and the process for registration and cancellation of financial transactions will be reviewed,” he said.
During the third quarter, the FSC will grant final approvals to Korea’s first Internet-only banks -- Kakao Bank and K-Bank -- to launch their services in the fourth quarter of this year.
“If the finance industry is content with the status quo, the future of the sector cannot be guaranteed,” Yim said.
He also said the FSC plans to fully implement the bank account portability system this week to make it easier for people to shift their bank accounts for convenience.
By Park Han-na (hnpark@heraldcorp.com)
