, Korea

South Korea mulls normalizing eased rules on banks’ FX derivatives: report

The country relaxed rules in March amidst a severe dollar crunch.

South Korea is considering normalizing eased rules on banks’ foreign exchange derivatives, as FX liquidity conditions have improved amidst the global economic recovery, reports Yonhap News Agency.

The country relaxed rules in March after the country's FX and swap markets suffered a severe dollar crunch.

Last year, the country raised the cap on the holding of local banks' FX forward positions to 50% of their equity capital from the previous 40%. For local branches of foreign banks, the cap was lifted to 250% from 200%.

"Market volatility could increase amid global concerns about rising inflation and major economies' moves toward normalizing their accommodative monetary policy," Vice First Finance Minister Lee Eog-weon said, after a pan-government meeting on FX soundness.

"In this sense, the government plans to consider normalizing some of its FX-related rules that were eased (during the pandemic-caused market routs), depending on economic situations and FX liquidity conditions," he added.

Follow the links for more news on

Join Asian Banking & Finance community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Exclusives

ANEXT Bank’s Toh Sui Mei on how to stay ahead of SMEs needs
The CEO of Singapore’s newest digital bank talks about why banks find it challenging to meet the SMEs needs, and why digital banks are the answer.
Retail Banking
DBS Hong Kong shows off greener branch outfits
The bank is making a statement about the future not through a new product, but with its uniforms.