Chairman and CEO Sohn Byung-doo of the Korea Exchange (KRX) participated in the 2023 Milken Institute Global Conference held in Beverly Hills, Los Angeles, the United States, from April 30 to May 3, and conducted promotional activities for the Korean capital market for global investors.
The Milken Institute Global Conference is an annual international event held since 1998 by the Milken Institute, a non-profit independent economic research institute.
The Conference is often dubbed “Davos of the West,” and is attended by thousands of executives from Fortune 500 companies and prominent figures from economic, political, social, and cultural fields.
This year, the conference introduced a separate session on the Korean capital market for the first time.
During the session, titled “Global Investor’s View: Korea,” panelists, including KRX Chairman Sohn, actively promoted pan-governmental efforts to resolve the so-called “Korea discount,” such as improving access to the Korean market for global investors.
The session was moderated by Choi Hee-nam, visiting fellow of Korea Capital Market Institute (Former CEO, KIC). The panelists were KRX Chairman Sohn, Jin Seoung-ho, Chairman and CEO of Korea Investment Corporation, and President Shin Jhin-young of Korea Capital Market Institute.
Chairman Sohn explained in detail a plan to improve foreign investors’ access to the Koran market, developed jointly by the Korea Exchange and various governmental agencies, such as abolishing the mandatory registration of foreign investor, expanding English corporate disclosure, and improving the foreign exchange market structure.
Foreign investor registration requirement will be abolished in 2023.
Mandatory English corporate disclosures will be required in phases: Phase 1 by 2024: KOSPI market-listed corporations with assets of 10 trillion won or more or those with assets of 2 trillion won or more and foreign share ownership of 30 percent or more.
Under Phase 2 by 2026, KOSPI market-listed corporation with assets of 2 trillion won or more.
The operation of the foreign exchange market will be extended from current 9:00 to 15:30 to 9:00 to 02:00, and registered foreign institutions (RFIs) to access onshore interbank FX market will be permitted.
He also shared opinions with participants on major issues related to the Korean capital market, including pending matters such as the standards and evaluation of ESG disclosure, listing of foreign blue-chip companies to strengthen the global competitiveness of the Korean capital market.
Chairman Sohn said that the Korea Exchange would continue its efforts to promote the Korean capital market and communicate with global investors through overseas road shows in the future.
KRX Announces KOSPI USD Spot Index from May 8
The Korea Exchange (KRX) said on May 3 the exchange will release KOSPI USD Spot Index, a strategic index that realizes an effect of diversifying investments into KOSPI index and U.S. dollar, starting May 8.
The index is calculated by reflecting the change of the Korean won-to-USD exchange rate compared to that of the base day, Jan. 3, 2011, to the KOSPI index in the real time basis.
According to an analysis, the KOSPI USD Spot Index shows better performance and lower volatility than the KOSPI index.
From 2011 to April 2023, the KOSPI index rose 20.8%, while the KOSPI USD Spot Index increased 43.6 percent, showing higher long-term investment return.
In particular, when stock prices decline or go sideways, the KOSPI USD Spot Index shows relatively better performance than the KOSPI index.
Due to the tendency to move in opposite directions between the KOSPI index and the US dollar exchange rate, the volatility of the KOSPI USD spot index appears to be better stable compared to that of the KOSPI index.
KRX Extends Listing Fee Exemption of SRI Bonds by Two Years
The Korea Exchange (KRX) decided to extend the listing fee exemption of socially responsible investment (SRI) bonds by two years until June 14, 2025, KRX said on May 10.
SRI bonds refer to bonds whose proceeds are used to fund environmentally friendly projects, or projects that can create social benefits. They include green bonds, social bonds and sustainability bonds.
There are several guidelines and principles related to SRI Bonds, and if projects conform to the guidelines, they may be generally accepted as SRI bonds.
Earlier, KRX implemented a policy of exempting a listing fee and an annual charge of SRI bonds for three years from June 15, 2020 to June 14, 2023.
The step saved 3 billion won for a combined 200 companies which listed SRI bonds.