South Korea's National Assembly Policy Committee on the 20th demanded the Financial Services Commission (FSC) implement stronger monitoring of single-stock leveraged exchange-traded funds (ETFs) and prepare additional measures if necessary. The directive follows the FSC's announcement on the 16th of补充措施 to address KOSPI volatility, including raising basic deposits from 10 million won to 30 million won and expanding minimum trading units. Lawmaker Park Sang-hyuk, the ruling party's secretary of the Policy Committee, stated that committee members requested more rigorous market situation assessments and closer communication with the committee when formulating policies. The regulatory focus intensified after single-stock leveraged ETFs were identified as a major contributor to stock market volatility.
FSC Announces ETF Regulatory Measures on the 16th
The FSC on the 16th released补充措施 targeting single-stock leveraged ETFs after these instruments were identified as key drivers of KOSPI fluctuations. The measures include raising the basic deposit requirement from 10 million won to 30 million won and expanding minimum trading units. Park stated that committee members emphasized the need for stronger monitoring of overall market conditions and situation assessments, with requests for additional countermeasures if deemed necessary. He added that lawmakers asked the FSC to maintain closer communication with the Policy Committee during policy formulation processes.
Policy Committee Discusses Digital Asset Basic Act
The meeting on the 20th included discussions on the Digital Asset Basic Act, with multiple lawmakers having submitted related bills. Park noted that committee members expressed significant interest in the legislation, stating that market forecasts differ regarding the effects of the US GENIUS Act scheduled for implementation next year. He said there was general agreement on legislative preparation by the government, with further discussions planned. Park reported that the FSC provided updates on various legislative tasks related to consumer finance and productive finance initiatives, which have accumulated due to the committee's inability to convene smoothly in the first half of the term.
Financial Supervisory Service Receives Directives on Interest Rate Risk Management
During the subsequent coordination meeting with the Financial Supervisory Service (FSS), Park conveyed that lawmakers instructed the agency to conduct thorough management and supervision regarding risks arising from interest rate increases. He emphasized that ordinary citizens must not suffer harm when obtaining loans. Park also stated that lawmakers requested the financial authorities to rapidly prepare improvement measures for bank governance structure reforms, ensuring discussions proceed with transparency. Regarding future discussion schedules, Park explained that National Assembly law requires bill subcommittees to convene at least twice monthly, necessitating extensive preliminary discussions before subcommittee meetings to operate the Policy Committee in accordance with legal requirements.
FAQ
What measures did the FSC announce on the 16th for single-stock leveraged ETFs?
The FSC on the 16th announced补充措施 including raising the basic deposit requirement from 10 million won to 30 million won and expanding minimum trading units for single-stock leveraged ETFs.
Why did the National Assembly Policy Committee demand stronger ETF monitoring on the 20th?
The committee on the 20th demanded stronger monitoring because single-stock leveraged ETFs were identified as a major contributor to KOSPI volatility, prompting calls for more rigorous market assessments and additional countermeasures if necessary.
