Financial authorities announce $73B market stabilization program

Financial Services Commission Chairman Kim Byoung-hwan, left, and Financial Supervisory Service Gov. Lee Bok-hyun, right, converse at a financial policy meeting held at the Seoul Government Complex in Jongno District, central Seoul, on April 7. [NEWS1]

 
Korea’s financial authorities on Monday announced plans to deploy a 100 trillion won ($73 billion) market stabilization program in response to growing uncertainty in the wake of the U.S. government’s announcement of reciprocal tariffs.
 
According to the Financial Services Commission (FSC), the plan was discussed during a financial policy meeting chaired by FSC Chairman Kim Byoung-hwan on Monday. The meeting included top financial regulators and leaders from Korea’s five major financial groups — KB Kookmin, Shinhan, Hana, Woori, and NH NongHyup — as well as heads of policy financing institutions.
 
“With uncertainty in global and domestic financial markets and the economy running high following the U.S. tariff announcement last week, the next two months — leading up to the launch of a new government — will be critical for maintaining market stability,” said Kim. “We will ensure that the stabilization program, valued at approximately 100 trillion won, is ready to be executed promptly to supply liquidity as needed.”
 
A similar stabilization program was launched in the second half of 2022 in response to risks stemming from real estate project financing (PF). That package included bond market support through a bond stabilization fund, stock market interventions, and guarantees for PF developers, initially valued at around 50 trillion won. The program was later expanded to roughly 94 trillion won and remains active.
 

Financial regulators and leaders of Korea’s major financial groups, including Financial Services Commission Chairman Kim Byoung-hwan and Financial Supervisory Service Gov. Lee Bok-hyun, participate in a financial policy meeting held at the Seoul Government Complex in Jongno District, central Seoul, on April 7. [NEWS1]

 
Monday’s meeting also focused on supporting companies impacted by the ongoing trade tensions. Kim said existing policy measures and those currently underway would proceed as scheduled to maintain investor and market confidence.
 
The FSC also reiterated its commitment to fast-tracking the creation of a 50 trillion won strategic industries fund, aimed at bolstering advanced sectors in response to trade disputes.
 
Kim called on private financial institutions to play a proactive role in market support.
 
“Especially in times like these, the financial sector must fulfill its core function — ensuring stable markets and uninterrupted financial intermediation,” he said. “We expect financial holding companies and policy institutions to take the lead in supporting both market stability and capital access for businesses.”


Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.

BY KIM NAM-JUN [[email protected]]