Members of the ruling Democratic Party's Political Committee held a policy meeting with the Financial Services Commission on July 20, urging for "strong monitoring of market conditions" regarding the government's response to single-stock leveraged exchange-traded funds (ETFs).
Park Sang-hyuk, the committee's secretary, told reporters at the National Assembly, "We requested that additional measures be considered if necessary, and we asked for close communication with the committee." He added that the committee plans to discuss ETFs with the Financial Supervisory Service later that day. Park stated, "We will assess the situation after the discussions and provide updates."
Meanwhile, the Ministry of Economy and Finance, the Bank of Korea, the Financial Services Commission, and the Financial Supervisory Service announced on July 16 a series of measures to enhance ETFs, including raising the basic deposit requirement from 10 million won to 30 million won and increasing the minimum purchase unit to 20 shares. However, some critics argue that these measures may not sufficiently reduce market volatility.
In response, Kim Yong-beom, head of the Presidential Policy Office, emphasized on KBS's 'Sunday Diagnosis Live' the day before that "the government's supplementary measures should alleviate many of the side effects." He expressed concern over calls to delist single-stock leveraged ETFs, stating, "It is hard to imagine that happening, as investors are already involved and the product has a scale exceeding 10 trillion won. If delisting were to occur, it would deliver a tremendous shock to the market."
* This article has been translated by AI.
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