President Kim Junggak of Korea Securities Finance Corporation: "Expanding Role Beyond Market Safety Net to Growth Engine"

On September 16, Korea Securities Finance Corporation announced its plan to expand its role beyond serving as a safety net for the capital market, aiming to enhance its capacity as a growth engine supporting market development.

At a press conference marking the 70th anniversary of the company's founding, held in Yeouido, Seoul, President Kim Junggak stated, "In addition to our ongoing role as a 'safety net' in the capital market, Korea Securities Finance Corporation is pursuing various initiatives to strengthen our capabilities as a 'growth engine' supporting market development."

Kim Junggak, President of Korea Securities Finance Corporation, is speaking at the 70th anniversary press conference held on the 16th in Yeouido, Seoul. Photo by Yoo Hyunseok

Korea Securities Finance Corporation will intensify its efforts to successfully implement its three main management strategies: strengthening its role as a market safety net, global expansion, and digitalization, which have been pursued since last year.

In line with the growth of the capital market, Korea Securities Finance Corporation has increased the scale of liquidity it supplies to the market. The average annual balance of liquidity supplied grew from 820 billion won in 2015 to 2.15 trillion won in 2020, and reached 3.17 trillion won in the first half of this year. The company also plans to support overseas investments going forward.

President Kim said, "Considering the recent trend of expanding overseas investments, we plan to accept foreign currency stocks as collateral to help securities firms make better use of their holdings. We also intend to utilize resources such as foreign currency investor deposits to provide foreign currency liquidity."

To respond to the globalization of the capital market, the company plans to strengthen its capabilities in foreign currency-related operations. He emphasized, "We have established a dedicated department for foreign currency operations and completed additional recruitment of foreign exchange professionals. We will focus on enhancing our competitiveness in foreign currency operations by diversifying management tools such as expanding counterparties for foreign currency repurchase agreements (RPs), managing foreign currency bonds, and broadening foreign currency funding channels, including issuing foreign currency bonds."

In addition, Korea Securities Finance Corporation is implementing a range of programs to strengthen its digital capabilities in response to the paradigm shift in finance brought about by artificial intelligence (AI) and digital transformation. He said, "We are running digital capability enhancement programs such as a digital technology contest, AI innovation leader program, and AI utilization platform. We are also planning a research project on the changing role of Korea Securities Finance Corporation at this time of innovation, as virtual assets and the capital market become increasingly integrated in line with the legalization of virtual assets."

The company is in the process of converting its existing Hong Kong office into a Hong Kong corporation to provide more substantial support for the overseas business of domestic securities firms. After completing a review of relevant laws and internal decision-making, the company aims to establish the Hong Kong corporation within the first quarter of next year, following notification to financial authorities. He explained, "Through the Hong Kong corporation, we will actively support the overseas business of domestic securities firms and will continue to seek ways to further expand their role in the rapidly changing global financial environment."

Korea Securities Finance Corporation achieved its highest performance since its founding last year and continues to see profit growth this year. The company also expects to reach 4 trillion won in equity capital. Accordingly, it will strengthen its support for the financial investment industry in line with the government's policies to vitalize the capital market and expand the supply of venture capital. Based on this, the company plans to establish a virtuous cycle that further solidifies its profit base.

The company also plans to strengthen shareholder rights and interests. By 2026, it will revise relevant regulations and procedures to introduce interim dividends. Korea Securities Finance Corporation will establish shareholder-friendly policies, such as maintaining a stable dividend payout ratio.

He emphasized, "Based on our 70-year history, Korea Securities Finance Corporation will continue to strengthen its core role and strive to support a better future for the capital market. By pursuing management strategies that respond to changes in the financial environment, we aim to achieve mutual growth for both the capital market and Korea Securities Finance Corporation."