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Financial watchdog seeks to foster long-term investments
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South Korea's financial watchdog said Tuesday it plans to encourage long-term
investments as part of its efforts to reduce volatility in the local stock
market.
The Financial Services Commission (FSC) said in a report submitted ahead of the parliamentary audit that it plans to review ways to expand the capital market base so that institutions and long-term retail investors can act as a safety valve to check sudden fluctuations in the local stock market.
The FSC said it aims to solve possible problems in pension funds and institutions' investments as well as induce retail investors to opt for long-term indirect investments rather than short-term direct investments.
The financial watchdog also said it plans to organize a contingency plan that would bolster the role of institutional investors.
The move comes as part of efforts to quell the local financial market's volatility, stemming from high foreign stock ownership and individuals' short-term investments.
Foreigners are the country's biggest stock investor group, holding more than 30 percent of local shares. Their high ownership has spurred worries of excessive capital flows easily denting the local stock market's stability.
The FSC also said it plans to reorganize the process for initial public offerings and company bond takeovers to help expand the roles of local brokerages.
Date
2011.09.20
The Financial Services Commission (FSC) said in a report submitted ahead of the parliamentary audit that it plans to review ways to expand the capital market base so that institutions and long-term retail investors can act as a safety valve to check sudden fluctuations in the local stock market.
The FSC said it aims to solve possible problems in pension funds and institutions' investments as well as induce retail investors to opt for long-term indirect investments rather than short-term direct investments.
The financial watchdog also said it plans to organize a contingency plan that would bolster the role of institutional investors.
The move comes as part of efforts to quell the local financial market's volatility, stemming from high foreign stock ownership and individuals' short-term investments.
Foreigners are the country's biggest stock investor group, holding more than 30 percent of local shares. Their high ownership has spurred worries of excessive capital flows easily denting the local stock market's stability.
The FSC also said it plans to reorganize the process for initial public offerings and company bond takeovers to help expand the roles of local brokerages.
Source: Yonhap News (Sept. 20, 2011)