Korea Investment & Securities Co. is moving to aggressive marketing, such as reflecting global asset sales performance in key performance indicators (KPI) at the sales front. Although the financial authorities have urged restraint in marketing overseas stocks since late last year, the shift is seen as a change in sales strategy as investors tired of sharp swings in the domestic market move to overseas markets.
According to the financial investment industry on the 27th, Korea Investment & Securities Co. recently reflected sales performance of products related to global assets in the KPIs of branch PBs (private bankers). On the sales floor, it is said to be responding by strengthening analysis of overseas investment assets to guide customers and expanding the provision of investment information.
Some say the company's sales policy runs counter to the financial authorities' stance of refraining from marketing and advertising overseas stocks. When the government in late last year pointed to the increase in individual investors' overseas stock investments as one of the causes of the won-dollar exchange rate surge, the financial authorities asked securities firms and asset managers to refrain from excessive marketing and advertising related to overseas stock investments to stabilize the exchange rate.
At the time, the Financial Supervisory Service (FSS) began inspecting the status of overseas stock sales at six securities firms engaged in overseas stock brokerage, including Korea Investment, NH Investment, Kiwoom, and Toss Securities, and two top managers of overseas stock funds. In addition to checking for aggressive marketing such as events that pay cash in proportion to transaction amounts, it looked into overall sales practices, including how KPIs were being operated to encourage overseas investment sales at branches.
Securities firms, in line with the financial authorities' stance at the time, completely halted new cash-like events and advertisements related to overseas investments through March of this year and reflected this in their KPIs.
Although the won-dollar exchange rate has recently fallen to the 1,300-won range, the financial authorities' stance of urging restraint in overseas stock marketing remains in place.
An official at the financial authorities said, "The request to refrain from marketing related to overseas investments still stands," and added, "If excessive marketing or investment solicitation for overseas stocks takes place, it could pose problems for investor protection and may become subject to on-site inspection."