South Korea to fine two Hong Kong banks for naked short-selling By Reuters

© Reuters.

SEOUL (Reuters) – South Korea’s inventory market watchdog stated on Sunday it discovered two Hong Kong-based funding banks had engaged in bare short-selling, which might possible end in document fines.

The 2 unnamed funding banks made bare short-selling transactions of a complete 40 billion received ($29.58 million) and 16 billion received, respectively, the Monetary Supervisory Service (FSS) stated in an announcement.

Bare quick promoting of shares – wherein an investor quick sells shares with out first borrowing them or figuring out they are often borrowed – is banned by the Capital Markets Act in South Korea.

The violations by the worldwide banks had been over lengthy intervals, for 9 months via Might 2022 and 5 months via December 2021, respectively, and anticipated to end in document quantities of fines, the FSS stated.

The FSS stated such violations, which got here in opposition to authorities’ efforts to offer a extra beneficial atmosphere for overseas traders, must be prevented from recurring and that it might additionally look into practices at different related funding banks.

($1 = 1,352.2100 received)