By Lee Hyo-sik
Staff Reporter
Finance and Economy Minister Kwon O-kyu said the Korean government will allow the opening of integrated accounts for foreigners investing in local securities from as early as the fourth quarter of the year to attract more inbound investment.
In an investor relations (IR) session in London on Thursday, Kwon, who is also deputy prime minister, said that in order to encourage more foreigners to purchase won-denominated bonds, the government will permit non-Korean investors to use the so-called ``omnibus account.''
``As part of our effort to attract more international investment and reinvigorate Korea's bond market, the Korean government will let foreign investors buy local securities through the omnibus accounts,'' Kwon told more than 150 investors and journalists attending the session. The accounts will likely be allowed only for those investing in won-denominated bonds.
An omnibus account refers to an account held by the International Central Securities Depository (ICSD) and other securities depository agencies that carry out securities investment for a group of individual and corporate investors.
Currently, foreign investors wanting to purchase stocks and bonds here have to register their names, addresses and other personal information with the Financial Supervisory Service (FSS), and open securities accounts in their names at domestic banks dealing with foreign currencies.
However, if the opening of an omnibus account is allowed, foreigners will be able to invest in local securities in a more convenient way as they do not have to go through the rather cumbersome process to open individual accounts. Instead, securities depository companies will set up accounts in their names at local banks, and manage a number of customers' investments through their omnibus accounts.
The Ministry of Finance and Economy said if the establishment of omnibus accounts is allowed, foreigners will purchase more local bonds, contributing to the development of the bond and overall financial markets.