Lee Eokwon: "Foreign Integrated Account Investment Assets to Expand from Domestic Stocks to ETFs... Globalizing the Capital Market"

"Deliberating on Dual Listing Criteria, Including Board and Shareholder Protection"
"Separation of Finance and Virtual Assets Requires Consideration of Global Developments and Financial Stability"

The range of assets that foreign investors can invest in without opening an account at a domestic securities firm is expanding from individual Korean stocks to Korean exchange-traded funds (ETFs). This move aims to attract diversified investment demand into the domestic market and further globalize Korea’s capital market.

Lee Eok-won, Chairman of the Financial Services Commission, speaks at a press conference on the "Top 10 Core Achievements in the Financial Sector" held on the 21st at the Government Complex Seoul. Financial Services Commission

Lee Eokwon, Chairman of the Financial Services Commission, stated at a press conference on the “Top 10 Key Achievements in the Financial Sector” held at the Government Complex Seoul on the 21st, “We will actively promote the globalization of the capital market, encouraging the inflow of global funds and high-quality assets.”

The Financial Services Commission has decided to expand the range of assets eligible for foreign integrated account investments, which allow foreign investors to buy Korean stocks without opening an account at a domestic securities firm. Chairman Lee said, “Overseas individual investors are expressing strong interest in purchasing Korean stocks, but there are still insufficient mechanisms in place for them to invest. We intend to expand the eligible assets for foreign integrated accounts from domestic stocks to ETFs.” He added, “We plan to announce the regulatory changes soon, and if there are institutions already prepared before the official announcement, we will implement the changes quickly through a no-action letter process.”

Regarding the exceptional standards for allowing dual listings, he explained, “Rather than explicitly defining exceptions such as for future advanced industries, we are considering a system where the criteria are based on the board of directors’ protection of shareholders, the specificity of their obligations, and the sufficiency of their efforts to protect shareholders.” He continued, “To gather a wide range of stakeholder opinions, we will host two seminars this month and plan to release a draft of the detailed regulatory guidelines either at the end of this month or early next month.”

On the criteria for dividing leagues under the KOSDAQ promotion and relegation system, which may be implemented as early as October, he said, “We will take more time for sufficient discussion.” The KOSDAQ promotion and relegation system divides companies into leagues such as “Premium” and “Standard” based on market capitalization. His comments were in response to concerns that, since the KOSDAQ is a league for companies with growth potential rather than just performance, dividing leagues solely based on market capitalization could provoke opposition.

Eokwon Lee, Chairman of the Financial Services Commission, is speaking at a press conference on the 'Top 10 Key Achievements in the Financial Sector' held at the Government Seoul Office Building on the 21st. Financial Services Commission

When asked whether Hana Bank’s recent investment in Dunamu shares signals a potential shift toward “separation of finance and virtual assets,” Chairman Lee declined to give a direct answer. He said, “We must comprehensively consider changes in the global market, user protection, and financial stability,” and added, “With the second phase of virtual asset legislation currently underway, we will take these factors into account as well.”

Regarding the upcoming listing of a domestic single-stock leveraged ETF on the 27th, Chairman Lee said the commission will continue to monitor the market. He explained, “The introduction of single-stock leveraged ETFs aims to address regulatory inconsistencies, as these products are permitted overseas but not domestically. To ensure regulatory consistency, we decided to allow them. We have established investor protection measures such as advanced investor education and minimum deposit requirements, and have set listing criteria such as a minimum of 10% market capitalization and 5% trading volume for the underlying assets to prevent a ‘wag the dog’ scenario.”

The Financial Services Commission is also preparing for an international investor relations (IR) event. Chairman Lee said, “We plan to hold the ‘Korea Premium Week,’ an international IR event, in September. Our goal is to create a representative event that brings together all institutions, just like Japan’s ‘Japan Weeks’ and Taiwan’s ‘Taiwan Weeks,’ so that the Korean capital market immediately comes to mind.” He added, “We also plan to pursue overseas IR activities in the fourth quarter of this year to attract promising global companies to list on KOSDAQ.”

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