The Financial Supervisory Service Begins Department Head Reports from the 6th... Emphasizing 'Capital Market Advancement' Again This Year

Financial Supervisory Service Completes 2025 Work Plan Internally
Inspection and Supervision Directions to Be Specified Based on This
Resumption of Short Selling and Launch of ATS Are Key Issues
'Internal Control' Checks Also Important Matters

Heads of each department at the Financial Supervisory Service (FSS) will begin reporting their 2025 departmental work plans to FSS Governor Lee Bok-hyun starting from the 6th. This year, while focusing on real estate project financing (PF) and household debt management, the Capital Markets Bureau will concentrate on 'capital market advancement' initiatives such as the resumption of short selling and the launch of the Alternative Trading System (ATS). The inspection and supervision direction is expected to emphasize financial companies' 'internal controls.'

According to financial authorities, the new department heads at the FSS will start reporting their work plans to Governor Lee from the 6th, and executives will also sequentially provide their reports. The reporting schedule has been delayed compared to previous years. The FSS explained that this delay was due to the replacement of 74 out of 75 department heads.

The department heads' and executives' work reports are aligned with the FSS's 2025 work plan. Although the FSS has not yet announced this year's work plan, it is known that the key contents have been internally finalized.

The capital markets and accounting divisions will again focus on 'capital market advancement' this year. An FSS official stated, "As in the previous year, we will concentrate on capital market advancement," adding, "We plan to focus our work reports on the resumption of short selling, ATS, corporate value-up programs, internal controls, and various infrastructures." The official further noted, "Governor Lee emphasized the stance that despite the turbulent political situation, the economy must continue to do what needs to be done."

The biggest issue related to capital market systems is the resumption of short selling scheduled for the end of March. The construction of a short selling IT system to prevent naked short selling is currently being finalized. The FSS plans to publish an integrated short selling guideline in January and complete the issuance system for short selling registration numbers. After reviewing the preparation status for the resumption of short selling in early March and conducting a demonstration of the naked short selling detection process, short selling will be resumed at the end of March.

Another important issue is the launch of the ATS in the first half of this year. Until now, the Korea Exchange has monopolized the stock trading market, but as part of 'capital market advancement,' the ATS will be launched. Stock trading will be possible for 12 hours from 8 a.m. to 8 p.m., and the types of order quotes will become more diverse. Trading commission fees are also expected to decrease by 20-40%. The FSS will hold a joint briefing session with related organizations next month regarding the ATS launch.

The inspection policy is expected to remain largely unchanged from previous years. However, this year, financial companies' 'internal controls' will be closely scrutinized. This is due to significant internal control issues that emerged across the entire financial sector last year, including banks, securities firms, and trust companies. Banks and financial holding companies must submit their accountability structure charts to financial authorities by this month, and securities firms by July. The FSS plans to monitor progress and respond strictly if internal control problems arise.

This content was produced with the assistance of AI translation services.