Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
Top 5 financial groups to supply $67 bil. to stabilize market
Financial Services Commission (FSC) Chairman Kim Joo-hyun, fourth from left, stands next to chairmen of major financial groups in central Seoul, Tuesday. From left are, Shinhan Financial Group Chairman Cho Yong-byoung, Woori Financial Group Chairman Son Tae-seung, KB Financial Group Chairman Yoon Jong-kyu, Kim, Korea Federation of Banks (KFB) Chairman Kim Kwang-soo, Hana Financial Group Chairman Ham Young-joo and NH Financial Group Chairman Son Byung-hwan. Yonhap
By Anna J. Park
By Anna J. Park
Five major financial groups here have decided to provide ample liquidity worth 95 trillion won ($67 billion) by the end of this year in a bid to ease a bond market crunch and stabilize local financial markets.
During a meeting with Financial Services Commission (FSC) Chairman Kim Joo-hyun on Tuesday morning, the chairmen of the five groups pledged to inject a total of 73 trillion won into financial markets, while pooling another 12 trillion won into a bond market stabilization fund and another 10 trillion won for their group subsidiaries.
They also vowed to refrain from issuing bank bonds, so that the local short-term money market can absorb more corporate debt issued by local companies. The financial groups also pledged to proactively purchase various types of commercial paper, asset-backed commercial paper (ABCP), as well as special bonds issued by state-run companies, in order to provide liquidity to local financial markets.
Financial Services Commission (FSC) Chairman Kim Joo-hyun speaks during a meeting with chairmen of the top five financial groups in central Seoul, Tuesday. Yonhap
The financial group chiefs and the nation's top financial regulator shared a common understanding that the local market has responded recently with an excessive level of anxiety, even considering growing concerns over tightening monetary policies in the global economy. They vowed to play a larger role in stabilizing the market that has seen an increased level of volatility.
“We've recently witnessed a complex layer of crises with inflation, a slowdown of the economy and increased ABCP risks, and we need to pool our wisdom to stabilize the market to overcome the situation,” KB Financial Group Chairman Yoon Jong-kyu said during the meeting.
“As the shortage of liquidity in the funding market negatively affects foreign exchange markets, Shinhan Financial Group will try to stabilize the market as much as possible,” Shinhan Financial Group Chairman Cho Yong-byoung said.
Hana Financial Group Chairman Ham Young-joo said his group will provide loan support to companies suffering temporary liquidity shortages. “I believe financial groups' responsibility is significant in overcoming the current difficulties,” he said.
Woori Financial Group Chairman Son Tae-seung also shared the view that the role of financial companies has become more important than ever, vowing to closely cooperate with the policy of financial authorities.
“The group will closely participate in authorities' concerted efforts, while fully supporting their policies to stabilize the financial markets and local economy,” he said.
NH Financial Group Chairman Son Byung-hwan said he thinks the financial authority and financial groups need to strengthen communication to jointly respond to the market changes.
“I think it is a good idea for us to meet the FSC chairman once every two weeks to maintain market stabilization,” he said.
The top financial regulator said he will hold close consultations with the five financial group chiefs on a regulator basis, while maintaining a communication channel with the groups until the local financial markets stabilize.