President Lee Jae-myung ordered prompt supplementary measures for Samsung Electronics and SK Hynix single-stock leveraged exchange-traded funds (ETFs) on the 15th at a Financial Supervisory Service (FSS) briefing at the Blue House. The directive followed FSS Governor Lee Chan-jin's repeated criticism of the ETF approval process, including a June 22 statement expressing personal regret for not blocking the securities registration. The single-stock leveraged ETFs were introduced on May 27 and have operated for approximately 1.5 months, during which regulatory authorities have raised concerns about domestic stock market volatility linked to the products.
During the briefing, President Lee asked Governor Lee, "Recently, it seems you've been under a lot of pressure because of the Samsung-Hynix ETFs." The governor responded, "As a market supervisor, we have responsibility, and we are fulfilling that responsibility." The president then addressed Korea Exchange officials present, stating, "The exchange is also noisy because of ETFs, right? Prepare supplementary measures promptly. Normalizing and advancing the capital market is an important task, so please take good care of it."
FSS Governor Expresses Regret Over ETF Approval Process
Governor Lee Chan-jin has consistently voiced criticism of the single-stock leveraged ETF introduction. At a press conference on June 22, he stated regarding the ETF approval, "I personally reflect on whether I should have blocked it, even by lying down before accepting the securities registration." On July 13, Governor Lee met with representatives from 20 asset management companies and reportedly remarked that finding a clear solution to domestic stock market volatility caused by leveraged ETFs is difficult.
Blue House Announces F4 Review of Leveraged ETF Impact
The Blue House issued a statement the day before the presidential briefing addressing Governor Lee's remarks: "Leverage-related matters are being reviewed by F4 (Ministry of Finance and Economy, Bank of Korea, Financial Services Commission, Financial Supervisory Service), and countermeasures are being prepared together." Blue House Policy Chief Kim Yong-beom stated, "The system was introduced on May 27, and about a month and a half has passed. Since it's a newly introduced system, F4 meetings will closely examine the market impact during operation. If necessary supplements exist, they will be reviewed, discussed, and decided at F4 meetings."
FAQ
What did President Lee Jae-myung order regarding Samsung and SK Hynix leveraged ETFs on the 15th?
President Lee ordered prompt supplementary measures for Samsung Electronics and SK Hynix single-stock leveraged ETFs during a Financial Supervisory Service briefing at the Blue House on the 15th. He instructed officials to prepare measures swiftly and emphasized that normalizing and advancing the capital market is an important task.
Why did the FSS governor express regret over the leveraged ETF approval?
FSS Governor Lee Chan-jin stated at a June 22 press conference that he personally reflects on whether he should have blocked the securities registration for single-stock leveraged ETFs before approval. He later remarked on July 13 that finding a clear solution to domestic stock market volatility caused by these ETFs is difficult.
When were the Samsung and SK Hynix single-stock leveraged ETFs introduced?
The single-stock leveraged ETFs were introduced on May 27. According to Blue House Policy Chief Kim Yong-beom's statement, approximately a month and a half had passed since introduction, during which F4 authorities have been monitoring market impact.
