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[Alpha Biz=(Chicago) Reporter Paul Lee] Kim So-young, vice chairman of the Financial Services Commission, said on the 16th that the ban on short selling could be extended further.
"I told you that it was at the end of June next year, but I plan to look at the market trends and see the situation of the improvement of the system and make a decision then," Vice Chairman Kim said at the "Democratic Party Council for the Improvement of the Public Sale System" held at the National Assembly.
"We will make our best efforts as much as possible so that we can resume the public sale from the end of June, but we may extend it further if there are not enough improvements in the system," Vice Chairman Kim said.
On the same day, the ruling party and financial authorities announced a plan to improve short selling, which includes unifying individual, foreign and institutional collateral ratios, unifying the repayment period, preventing illegal naked short selling, and strengthening punishment for illegal short selling.
As most of them are parliamentary legislation, the government plans to decide on detailed measures through the National Policy Committee of the National Assembly. Analysts say that it will not be difficult to pass the National Assembly as the opposition Democratic Party of Korea is not much opposed to it, but some predict that the legislation may be delayed after June depending on the detailed consultation process.
In addition, some analysts say that the resumption of the public sale could be further delayed regardless of the legislation of the new system improvement plan, as individual investors are strongly opposed to the public sale.
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