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Biz News Korea(Eng)
Korea’s FSC head vows to come up with revision in short-selling rules soon
- Collected
- 2016.10.07
- Distributed
- 2016.10.10
- Source
- Go Direct
“We will come up with revised short-selling rules as soon as possible after studying the overall situation,” said Yim Jong-yong, chairman of the Financial Services Commission, in a parliamentary audit on Thursday.
The financial authorities are conducting extensive probe on Hanmi Pharmaceutical on the suspicions that the drug maker intentionally delayed announcement on cancellation in contract with Boehringer Ingelheim for 14 hours before making the disclosure, and whether there had been illicit insider trading behind the mass-scale short selling.
Under the current system, disclosure on short-selling bid is made three days after transaction.
The FSC is also mulling to make listed companies disclose the pricing for new issues before instead of after equity capital increase.
During the equity capital increase program led by Hyundai Merchant Marine in July, institutional and foreign investors pocked nearly 30 percent in profits from short selling ahead of the issues while retail investors incurred 45 percent loss in their holdings due to sharp fall in stock prices.
But outright ban on short selling after new issues is not possible under Korea’s market-friendly nature, said Yim.
He also was against the idea of making investors release exact number of short-sold shares as they would be exposing their investment portfolio.
By Chung Seok-woo and Ahn Byung-joon
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]