Financial Supervisory Service exempts securities companies from obligation to maintain credit lending collateral ratio until the end of January next year

The Financial Supervisory Service announced on the 8th that it will issue a no-action opinion exempting securities companies from the obligation to maintain credit lending collateral ratios for three months until January 31 of next year.

This was an issue discussed at the emergency market situation review meeting on the 6th to alleviate concerns about a surge in counter-credit trading due to the sharp decline in the stock market, and issuance will begin on the 9th.

According to financial investment industry regulations, securities companies are required to secure more than 140% of collateral when executing a credit loan, and to request additional collateral from investors if this ratio falls below this ratio due to a decline in stock prices. If you do not comply, you will be subject to forced disposition through reverse sales.

During the period when the obligation to maintain the collateral ratio is exempted, securities companies can flexibly determine the collateral maintenance ratio in consideration of market conditions, etc.

Mirae Asset Securities decided to lower the credit and loan collateral maintenance ratio for domestic stocks from 140% to 130% from the 9th, but maintain the existing 160% for managed stocks and liquidation stocks.

Korea Investment & Securities and Kiwoom Securities decided to temporarily suspend reverse trading only for customers who applied separately.

The Financial Supervisory Service plans to monitor market conditions and strive to alleviate stock market volatility, and the Korea Financial Investment Association plans to manage 'debt investment' risk by ensuring that the plan to strengthen autonomous management of credit loans prepared in September is implemented.