Recently, a bill called the 'Samsung Life Insurance Act' is heating up the stock market.

Some of you might be thinking, "Why did the name 'Samsung Life' come out when making the law?"

However, the problem is more complicated than you think.


why is it important


This is because when this law crosses the threshold of the National Assembly, it seems that the wave will not be touched.

This is because it can shake not only the 6 million shareholders of Samsung Electronics, but also the Samsung Group's governance structure itself.



Original insurers cannot hold more than 3% of total assets in affiliate stocks.

However, in the amendment to the Insurance Business Act, also known as the Samsung Life Insurance Act, the standard for valuing stocks is set to the current price, not the acquisition cost.



Let's assume that an insurance company with current assets of 1 million bought 30,000 won worth of shares of an affiliate 10 years ago.

As of now, it doesn't matter if the stock price of affiliates jumps to 100,000 won.

By the way, if the Samsung Life Insurance Act is passed, you have to sell 70,000 won worth.

The situation at Samsung Life is exactly like this.


explain a bit more


Samsung Life owns more than 500 million shares of Samsung Electronics.

Since it was bought and raised 40 years ago, the acquisition cost is only 540 billion won.

It is far less than 3% of Samsung Life's total assets.



However, the story changes if we recalculate it at the current price (58,000 won).

It far exceeds 29 trillion won.

When the bill is passed, Samsung Life Insurance has to dispose of Samsung Electronics stocks worth more than 21 trillion won.



If this happens, Samsung Electronics stocks will pour into the market, so the stock price can't be avoided, and from Samsung Life's point of view, it can't be good because it's like putting blue chip stocks on the market that have been paying dividends.

Of course, the impact may not be as great as you think because it gives you a period of time to dispose of it for several years.



The problem doesn't end here.

If you look at it longer, it will inevitably affect the entire Samsung Group.



To briefly talk about the governance structure of the Samsung Group, starting with Samsung C&T, it is a structure in which Samsung Life Insurance and Samsung Electronics are biting their tails.

The owner family, which owns 31% of Samsung C&T's shares, controls Samsung by exerting influence over other affiliates.



There is an analysis that such a thing can happen if the number of Samsung Electronics stocks held by Samsung Life Insurance decreases.

For this reason, this law is also called the Samsung Release Act.


one more step


Then, can the Samsung Life Insurance Act cross the threshold of the National Assembly?

In fact, this is not the first time this law has come out in the world.

It was also proposed in the 19th and 20th National Assembly, but was abolished due to the expiration of the term.

However, this time things are a little different.

Following the position of "I agree with the purpose of the bill" from the financial authorities, last month, a full-fledged discussion began as it was submitted to the so-called National Assembly's Political Affairs Committee bill.



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