Domestic securities firms have seen a significant increase in revenue from overseas stock fees, despite 'overseas investors' selling off large amounts of foreign stocks. The total commission income from overseas stock transactions for major securities firms has surpassed 1 trillion won for the first time this quarter.
According to the Korea Financial Investment Association on August 17, the second-quarter revenue from foreign securities custody fees (overseas stock fees) for 12 securities firms, including Toss Securities, Mirae Asset, Kiwoom, Samsung, NH, Korea Investment, KB, Shinhan, Kakao Pay, Hana, Daishin, and Meritz Securities, totaled 1.0176 trillion won. This marks a 59.7% increase from the first quarter's 636.4 billion won and is the highest quarterly figure on record.
Among the firms, Toss Securities showed the most remarkable growth. Its foreign securities custody fee revenue rose 76.3% from 124.4 billion won in the first quarter to 219.3 billion won in the second quarter, becoming the first domestic firm to exceed 200 billion won in quarterly commission income.
Mirae Asset Securities also reported a 54.1% increase, from 115.4 billion won in the first quarter to 177.8 billion won in the second quarter. Kiwoom Securities increased from 80.4 billion won to 135.5 billion won, a rise of 68.5%, while Samsung Securities grew from 78.1 billion won to 121.5 billion won, up 55.6%, both surpassing 100 billion won.
Other firms reported the following revenues: NH Investment Securities at 87.1 billion won, Korea Investment Securities at 74.2 billion won, KB Securities at 66 billion won, Shinhan Investment Securities at 57.9 billion won, Kakao Pay Securities at 34.4 billion won, Hana Securities at 21.2 billion won, Daishin Securities at 12.2 billion won, and Meritz Securities at 10.5 billion won.
The increase in overseas stock fee income is attributed to a rise in trading volume. In the first quarter, overseas investors' trading volume in the U.S. stock market totaled $149.2 billion, with $78.9 billion in purchases and $68.3 billion in sales. In the second quarter, this volume increased to $170.5 billion, with $84.8 billion in purchases and $85.6 billion in sales.
Despite the selling pressure in the second quarter, the overall trading volume expanded. Overseas investors, who had net purchased $10.64354 billion (15.978 trillion won) in the U.S. market in the first quarter, turned to net selling of $775.74 million (1.1003 trillion won) in the second quarter. In the Hong Kong market, net selling increased from $233.76 million in the first quarter to $318.02 million in the second quarter. The domestic market return account (RIA) policy, which offers a 100% capital gains tax exemption for funds returned to the domestic market until the end of May, is believed to have influenced this shift to net selling.
In the Hong Kong market, the total trading volume, including both purchases and sales, rose from $2 billion in the first quarter to $2.7 billion in the second quarter. Although overseas stock investors turned to net selling, the increase in overall trading volume led to higher commission revenues for securities firms.
A financial industry official stated, “Although overseas stock investors have shifted to net selling, the sales are still included in the trading volume, which translates to commission income for securities firms. The increased market volatility has likely led to more active buying and selling, contributing to the rise in overseas stock fee income.”
* This article has been translated by AI.
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