As early as 2019, Korea will introduce an e-securities system to allow all stocks under capital market law to be issued and traded via a computerized network instead of through paper securities, the country’s leading financial watchdog said Thursday.
The Financial Services Commission said the system, through which stocks would be issued and distributed through computerized registration, will greatly save costs in the process of securities issuance, prevent fraud and raise transparency in stock trading. The savings is estimated at 435 billion won ($400 million) for the five-year period after launch.
The combined market cap of domestic companies was US$1.341 trillion as of April 15, the 11th highest in the world, per data by the Korea Exchange (KRX) and Bloomberg.
All securities under the jurisdiction of the Capital Market Act will be subject to the computerization, it said, including listed stocks and bonds, profit-making and derivatives-linked securities, and depository securities.
The commission added that it will submit this year a related regulation to a regular session of the National Assembly.
By Lee Kyung-ho
