The Korea Exchange (KRX) analyzed that if listing maintenance standards are tightened going forward, about 230 listed companies could be delisted from the stock market by 2029. That would be 8% of all listed companies.
The Korea Exchange (KRX) reported these simulation results at a briefing by related financial institutions under the Financial Services Commission held at the Government Complex Seoul annex on the 12th. The financial authorities prepared measures to expel poorly performing corporations from the stock market to boost the domestic stock market. They strengthened listing maintenance standards such as market capitalization and sales, and streamlined delisting procedures.
Excluding other variables and applying the tightened listing maintenance standards, the exchange estimated in a simulation that about 230 listed companies would be delisted by 2029.
The exchange said, "Compared with major overseas markets, the number of listed companies in Korea is still relatively large," adding, "Under the 'many births and many deaths' principle, we will consult with policy authorities on a range of early exit measures for various poorly performing companies."
Financial Services Commission Chairperson Lee Eog-weon, who received the briefing, said, "There will be various pushbacks due to the strengthened delisting standards, but please proceed decisively with the will to bring change."
In addition, the Korea Exchange (KRX) said it will improve its unfair trading monitoring and investigation system to cut the time to detection from the current six months to three months, about half. It will shift the investigation system from an account-based approach to an individual-based one and use artificial intelligence (AI) to strengthen investigative capabilities.
Lee said, "Please detect unfair trading swiftly so that the public can feel that change is happening."