April 23, 2024

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[THE INVESTOR] Korea’s financial regulator said on May 30 it will relax some capital rules and other technical standards for insurance firms to help them better cope with global accounting rules.

Korea is one of more than 100 nations that will adopt the the International Financial Reporting Standards 17, starting in January 2021.

When adopted, some insurers in Korea will face capitalization pressure, analysts said.

To help insurers alleviate potential fallouts from the change, the Financial Supervisory Service said it will lengthen the duration of the risk-based capital ratio of an insurer to 25 years from the current 20 years.

The revised rule will be applied to insurers starting next month if they want to adopt it, the regulator said in a statement.

Then in 2018, the duration will be further lengthened to 30 years, it said.

By Alex Lee and newswires (alexlee@heraldcorp.com)