April 27, 2024

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A senior financial regulator on March 26 called for financial firms to improve their internal control systems and governance structures, citing various risks that could weaken the nationa’s financial system.

Won Seung-yeon, deputy governor of the Financial Supervisory Service, made the remarks at a meeting with executives of securities and asset management firms earlier in the day.

“Given economic conditions at home and abroad, there are many factors that could pose a systemic risk to the capital market,” Won said, without elaborating.

South Korea’s main stock index sank nearly 2 percent on March 25, hit by fresh fears of a global economic slowdown.

The FSS will preemptively cope with risk factors in local stock and asset management markets, Won said.

From next month, the FSS will begin conducting a “comprehensive inspection” of financial firms as it seeks to strengthen protection for consumers and improve corporate governance at financial firms.

It will be the first time in four years that the FSS will carry out such inspections, which look into a range of issues at financial firms, including corporate governance, internal control systems, financial stability and consumer protection.

By Ram Garikipati and newswires (ram@heraldcorp.com)