Korea Securities Finance Corp (KSFC) plans to introduce key
measures to boost the country’s securities lending
market and ease regulatory, collateral and geopolitical
Jiwon Jung, chief executive of the KSFC, outlined four key
tasks for the organisation in Seoul at the PASLA/RMA event on
First, KSFC will introduce a collateral provision-type
securities lending business to reduce the collateral burden of
Secondly, the firm aims to strengthen its role as market
maker in the repo market in order to stabilise the Korean money
market and to promote short-term financial transactions.
Thirdly, KSFC will make preparations to provide Korean
financial investment companies with foreign currency liquidity
– boosting access to the FX market.
In addition, the group - which provides various financial
services such as securities-backed loans to investment houses
- plans to introduce the Korean-style securities financing
system to other countries.
Since 2010, the Korean SBL market has grown in size, with
stock and bond lending balances each increasing at an average
annual rate of 27% and 8% respectively.
The KSFC aims to maintain the growth through the four work
"The introduction of SBL-related regulations, such as the
SFTR in Europe and the net stable funding ratio of the FSB may
affect the growth of the Korean SBL market," Jung is expected
to say on Wednesday.
"Also EU member states have been witnessing a spread of an
EU exit and movement following Brexit and the US has been
"As countries around the world are increasingly pursing
their own interests, the level of political instability is
"Now is the time to transition toward qualitative growth,
and I believe the role of KSFC is of utmost importance in such
a transition period.
"KSFC will lead the effort of increasing the benefits
enjoyed by institutional investors at home and abroad and
revitalizing the overall capital market by advancing
securities-based liquidity creating techniques."