Korea will introduce a single account system in a pilot program to make it more convenient for foreign investors to trade stock here, the financial regulator said Tuesday.
Under the "omnibus account" system, offshore institutional investors can open a single account at a local securities company to handle stock trading of their clients in Korea.
Under the new system, they receive trading orders for Korean stocks from their clients and place the orders with the securities company where they have a single account, a Financial Services Commission (FSC) official said.
"If a global asset management firm or brokerage house receives trading orders from 100 clients, all the orders can be processed and settled through the single omnibus account. It will reduce foreign investors' inconvenience and cut transaction costs," the official said.
Currently, stock trading orders and settlements of each equity-linked fund have to be made separately even though funds are managed by a single entity. Offshore investors are also required to open separate accounts to make orders and settlements through a brokerage firm in Korea, complicating trading procedures.
The government plans to operate the pilot program by the end of this year. The omnibus account system will officially kick off in January 2017, he said.
The single account system is also part of the government's efforts to get its main stock market back on the global index provider MSCI's review list of developed market index candidates next month. (Yonhap)
