[THE INVESTOR] With the Bank of Korea reducing its policy rate to a record low of 1.5 percent, interest rates paid by local banks have dropped to zero percent, which could mean negative returns on bank deposits when adjusted for price inflation, according to market observers on June 15. According to the observers, Citibank Korea has cut the annual interest rate on its savings accounts for companies to 0.01 percent from 0.1 percent. A 0.01 percent interest rate submits 1,000 won ($0.85) per year

Strategy briefing• Korea’s Fair Trade Commission (FTC) last week announced new measures for the nation’s corporate designation system, with the key revision changing the definition of a “large” company from one with assets of KRW5t or more to KRW10t or more, which will likely affect 37 domestic firms (including 20 listed ones).• The amendments—except those governing profit-taking by majority stakeholders of chaebol (eg, from intra-group transactions) and select firms subject to obligatory disclo

[THE INVESTOR] South Korea‘s economic output increased in 2014 from a year earlier, a central bank report showed Wednesday.But output by the manufacturing sector fell, along with the portion of trade in total supply also shrinking. Busan PortThe country’s total supply, which equals total consumption, came to 4,237.8 trillion won ($3,598.1 billion) in 2014, up 0.7 percent from the previous year, according to the Bank of Korea. The reading was a turnaround from a 0.2 percent on-year drop in the pr

[THE INVESTOR] South Korea’s export prices fell 4 percent in May to post a fifth straight month drop on-year,  according to central bank data on June 15. But compared to April, the prices gained 2.4 percent. The on-month increase was largely credited to the weakening of the local currency, which traded at an average 1,171.51 won against the dollar in May, 2.1 percent drop from an average 1,147.51 won in the previous month, according to the central bank. Export prices of industrial goods decrease

[THE INVESTOR] Although the youth unemployment rate in South Korea remains high, it fell slightly in May, with a rise in employment in the health and accommodation industry, according to a government report on June 15. According to the report by Statistics Korea, the fourth-largest economy in Asia had a jobless rate of 3.7 percent last month, compared to 3.9 percent in April. The seasonally adjusted unemployment rate remained flat at 3.7 percent in May. Job creation soared compared to the previo

[THE INVESTOR] South Korean shares opened lower June 15 in light of growing “Brexit” rumors and investors adopting an uncertain attitude while waiting for the decision on rates by the U.S. Federal Reserve. The benchmark Korea Composite Stock Price Index slid down by 0.87 point, or 0.04 percent, to 1,970.16 in the first 15 minutes of trading. As decision on the U.S rate has been inching toward finalization since June 14, investors are keen on receiving more information on the matter.  123rf.Marke

[THE INVESTOR] As the vote over whether Britain should leave or remain in the European Union is drawing near, analysts are issuing a series of warnings that Britain’s EU exit, or “Brexit,” would have a severe impact on the global economy.A Brexit would also deal a blow to Korea, whose biggest free trade partners include the EU, as investors are expected to pull their funds out of Asian markets exposed to risks stemming from Britain’s EU referendum.(Yonhap)Confidence has already begun to be negat

[THE INVESTOR] In 2015, South Korea’s total assets grew 5.7 percent from a year earlier, central bank data showed Tuesday.As of the end of 2015, the country’s national assets came to 12,359.5 trillion won ($10.54 trillion), up 5.7 percent from a year earlier, according to preliminary data from the Bank of Korea. The 2015 tally is almost eight times higher than the country’s nominal gross domestic product for the same year.The increase, however, came mostly from a rise in nonfinancial assets, ref

[THE INVESTOR] South Korea’s public pension fund will keep increasing alternative investments and reduce local equities in the long term, as the behemoth’s snowballing assets will be too large for the domestic stock market, its chief investment officer has said.The National Pension Service, which manages about 524 trillion won ($450 billion) collected from 21 million Korean subscribers, is a significant client for leading asset managers around the world, who are hunting attractive real estate, i

[THE INVESTOR] Whether to increase corporate taxes is shaping up as a key issue of contention between major political parties in the new parliament that began its inaugural session Monday.The chief policymaker of the liberal main opposition Minjoo Party of Korea last week reaffirmed the party would soon submit a tax code revision bill to raise the maximum corporate tax rate, which would be applied to companies with annual profits exceeding 50 billion won ($42.6 million), to 25 percent from the c

[THE INVESTOR] The Bank of Korea on Thursday slashed the key interest rate to a new historic low in a surprise move that came one day after the government finalized measures to support corporate restructuring. The seven-day repurchase rate has been cut by 0.25 percentage point to 1.25 percent, the lowest on record. The BOK last reduced the borrowing cost in June 2015 amid the outbreak of the deadly Middle East respiratory syndrome virus here. A reduction was seen coming, but not this month. Near

[THE INVESTOR] The nation’s fair trade authorities said Thursday it would ease a key regulation to ban excessive expansion of conglomerates by raising the asset ceiling for its conglomerate watch list for the first time in seven years.In an economy-related ministers meeting held in Seoul, the Fair Trade Commission said it would boost the minimum asset criteria to 10 trillion won ($8.65 billion) from 5 trillion won. Fair Trade Commission in Sejong City (Yonhap)Mobile messaging giant Kakao and bio

Korea’s big three shipyards will seek to raise 10.3 trillion won through self-rescue plans

Korea faces an increasing need to ensure a balance between exports and domestic demand, which is crucial for the sustainable growth of its economy, economists say.They note changes in global economic conditions make the need more urgent but government policymakers are not yet fully up to the task.The country’s outbound shipments fell for the 17th consecutive month in May, though the pace of decline decelerated from the preceding months.The National Assembly Budget Office said in a report release