The Financial Supervisory Service plans to intensively check the risk management practices of securities firms and focus on unhealthy operations in the manufacturing and sales of high-risk financial investment products, taking into account the spread of financial market instability following the Corona 19 crisis this year.

In addition, considering the delay in the repurchase of private equity funds such as Lime Asset Management, the company plans to check the status of fund management by professional private equity managers and strengthen internal control checks.

The Financial Supervisory Service said that financial investment companies such as securities companies and asset management companies will select and pre-announce this year's key inspection items so that they can identify and solve problems through compliance monitoring and self-audit.

The Financial Supervisory Service decided to focus on risk management practices such as securities firms 'liquidity management against external shock factors as the financial market instability increased and securities firms' assets, liabilities, and leverage ratios increased significantly.

Total assets of securities companies increased by over 200 trillion won from 356 trillion won at the end of 2016 to 557 trillion won at the end of February this year, and total debt increased by 186 trillion won from 308 trillion won to 494 trillion won during the same period.

The leverage ratio rose 29% from 698.6% to 727.6%.

The Financial Supervisory Service also plans to check the management and sales process of overseas real estate-related products and high-risk financial investment products.

We decided to check the control of funds and secure stabilization of foreign real estate-related private equity funds and derivative bonds, and closely monitor the overall resale process.

In addition, it checks for unhealthy business conduct of manufacturing, sales, and post-management of high-risk financial investment products such as private equity funds, stock-linked securities, and derivatives-linked securities.

In addition, asset managers are inspected for appropriate internal controls such as on-site due diligence, risk assessment, and follow-up management in the process of investing and operating overseas investment funds, and subject to real estate trust company risk management status and trust account operation adequacy.

The Financial Supervisory Service is planning to examine the status of fund management for professional privately held companies that are vulnerable to risk management this year, as side effects of exposure to Lime Asset Management are exposed as professional privately held companies continue to increase.

Along with this, the company plans to strengthen inspections on the internal control sector to see if a professional privately held manager is autonomously preparing and inspecting the internal control checklist.

Considering the situation of Corona 19, the FSS will conduct inspections mainly for regular monitoring and written inspection for the time being, and will conduct on-site inspections as soon as the crisis warning phase is relaxed.