Financial authorities are expected to designate comprehensive investment account (IMA) operators for comprehensive financial investment companies (broker-dealers) with equity capital of at least 8 trillion won as early as this month. In particular, there is talk that Korea Investment & Securities and Mirae Asset Securities, whose reviews are moving quickly, could be jointly designated as the first IMA operators.
According to the financial sector on the 2nd, the IMA operator designation reviews for Korea Investment & Securities and Mirae Asset Securities have entered the final stage at the Financial Supervisory Service.
The Financial Supervisory Service has been conducting fact-finding, legal review, and screening procedures since receiving applications in Jul. There is no external evaluation committee review for the IMA this year, so it is reported that the Financial Supervisory Service is proceeding with the final procedures after on-site inspections.
Afterward, the screening report will be sent to the Securities and Futures Commission for deliberation, and the designation is expected to be finalized after a resolution by the Financial Services Commission (FSC).
In the industry, given that reviews for both Korea Investment & Securities and Mirae Asset Securities are moving quickly, there is also mention that they could be jointly designated as the first IMA operators.
By contrast, NH Investment & Securities applied at the end of Sep. after a rights offering, but remains in the early stages of review. In particular, with internal control issues arising amid recent allegations that a senior executive used nonpublic information, some say uncertainty has increased.
An IMA is a system in which a securities firm assumes the obligation to repay principal and seeks revenue by investing customer deposits in corporate finance-related asset(s) (70% or more), among others. Once an operator is designated this time, it will be the first designation in eight years since the system was introduced.
Financial authorities are also speeding up the process of designating broker-dealers and licensing issuance-note operators among securities firms with equity capital of at least 4 trillion won.
Kiwoom Securities and Hana Securities have completed the External Evaluation Committee review and on-site inspections, and Shinhan Investment & Securities has also finished the External Evaluation Committee review. In contrast, Samsung Securities and Meritz Securities are seeing slower reviews.
Because financial authorities have mandated that IMA and issuance-note broker-dealers supply 25% of funds raised as venture capital, they expect this designation to accelerate the shift to "productive finance."
Lee Eog-weon, chairman of the Financial Services Commission (FSC), said at a recent meeting with chief executive officers (CEOs) of the securities industry, "We plan to proceed swiftly with broker-dealer designations in the order in which reviews are completed so that the supply of venture capital is not delayed."