Chairperson Kim Byung-hwan noted on the 21st, "We will review the 'stock market system reform direction' to create a market structure that is more efficient and protects investors."
On that day, Chairperson Kim attended the 'Initial Public Offerings (IPO) and Delisting System Improvement Joint Seminar,' held by the Financial Services Commission, Financial Supervisory Service, Korea Exchange, and Korea Financial Investment Association in Yeouido, Seoul, in the morning.
Chairperson Kim stated, "We will seek to differentiate and link markets so that corporations can smoothly raise funds in the capital market according to their respective growth stages and characteristics, and investors can choose participation markets accordingly," adding that "we will begin a public discussion process to deeply analyze our market characteristics and overseas cases and gather opinions from stakeholders."
Currently, the exchange is conducting studies to prepare measures to enhance competitiveness through stock market structural reforms. According to the industry, it is said that there is a proposal under review to categorize the KOSDAQ market into two sections: a first section for excellent corporations and a second section for non-excellent corporations based on market capitalization and financial soundness. The exchange stated, "Specific details have not been finalized."
At the event, Chairperson Kim explained the background for improving the IPO and delisting system, stating, "The Korean stock market shows a significant asymmetry in the disparity between the market capitalization growth rate and the stock index growth rate compared to major countries' stock markets," and added, "The IPO market is excessively managed with a focus on short-term profits, and exits are not smooth compared to entry, which undermines the efficient functions and trust of the capital market."
He also noted, "We will expand mandatory holding commitments to ensure that institutional investors participate in demand forecasting based on corporate value evaluation, and we will strengthen participation qualifications," and added, "We will revise the system so that underwriters can focus not just on the success of IPOs but also on appropriate pricing and securing mid- to long-term investors."
Regarding improving the delisting system, he stated, "We will strengthen the requirements and streamline the procedures to ensure that companies that undermine market trust can exit smoothly," and added, "We will gradually raise market capitalization and revenue requirements to an effective level and significantly reduce the limits on delisting review stages and improvement periods."
Chairperson Kim said, "Even if the exits are expanded, we will support the transactions of delisted stocks to minimize investor losses and expand related disclosures," emphasizing that "sustaining momentum without loosening the reins steadily is important for the value-up of the capital market."