Why prime broking ambitions may cost Korea's big five
Pending regulation will allow the biggest securities firms to reinvent themselves as investment banks and engage in securities financing and other prime services – but profits may prove elusive.
The five largest Korean securities companies have indicated that they will apply to their regulator for approval to participate in the creation of onshore prime broking.
This forms part of a broader effort in which securities houses are redefining themselves as Western-style investment banks.
An amendment to the 2009 Capital Market Consolidation Act allows domestic securities companies to engage in investment-banking activity as early as June next year.
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