The Financial Supervisory Service has commenced a regular inspection of DAISHIN SECURITIES. Preliminary inspections will be conducted until the 30th of this month, and the main inspection is scheduled to start on the 16th of next month.
According to the FSS and the financial investment industry on the 12th, the FSS began its preliminary inspection of DAISHIN SECURITIES from this day. The preliminary inspection is a process to obtain the necessary electronic data for the main inspection and conduct written and interview investigations.
It has been 14 years since DAISHIN SECURITIES was last subjected to a regular inspection in 2011. The FSS has been conducting regular inspections only on large securities firms with more than 3 trillion won in equity since 2020. DAISHIN SECURITIES surpassed 3 trillion won in equity last year and became the 10th comprehensive financial investment business operator.
This regular inspection will focus on DAISHIN SECURITIES' net capital ratio (NCR) and other financial soundness indicators. The NCR is calculated by dividing operating net capital by risk amount; a lower ratio indicates higher risk and deteriorating financial soundness.
Comprehensive financial investment businesses are required to meet high NCR standards due to the high-risk nature of their operations. The financial authorities demand an appropriate NCR of 500%. DAISHIN SECURITIES saw its NCR increase from 355.1% last year by 73.3% to 428.4%.
Internal controls are also a major element under scrutiny in this regular inspection. In particular, DAISHIN SECURITIES has filed a claim for compensation against 12 employees of the branch that sold funds related to the "Lime Fund redemption suspension incident."
The FSS is also planning to conduct regular inspections of KB SECURITIES alongside DAISHIN SECURITIES this year.