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Overview of Investors’ Deposits in Trust

Types of Investors’ Deposits in Trust

Investors’ deposits for securities trading in trust and investors’ deposits for derivatives trading in trust

Business Description

Business Description
Fiduciary Relationship Investment dealers and brokers are the trustors/beneficiaries, and KSFC is the trustee
Method Methods prescribed by the Financial Investment Services and Capital Markets Act
Amount KRW 1 million or more
Period for Calculating Interest on Trust From Jan. 1 to Dec. 31 of each year
Interest on Trust Payment Advance interest payment each month (3rd business day of the following month); settlement on the closing date of the fiscal year
Valuation of Securities Mark to market (subject to accounting standards for trust assets)
Trust Fee Annual 0.04% of average balance (paid on interest on trust payment day)

Management of Trust Assets

  • KSFC manages and accounts for trust assets separately from its own assets
  • Investors’ deposits may not be transferred, pledged as collateral, offset, or attached (including provisional attachments)
  • Disclosures of operating performance and the benchmark price are made every month (disclosed both on and offline)

Operation of Trust Assets

Legal Basis

  • Article 74 of the Financial Investment Services and Capital Markets Act and Article 4-40 of the Regulations on Financial Investment Business
  • Separate Deposits in Trust Operating Guidelines (created by the Trust Management Committee)
  • Standards for the Risk Management of Trust Assets

Principles

  • Maintain liquidity, secure stability, and increase profitability
  • Flexible adjustment of portfolio according to market conditions
  • Strengthen compliance and risk management

Eligible Investment Tools

Government bonds, public bonds, securities-backed loans, deposits with banks/Korea Post, RPs, call loans, etc. (strictly limited to safe assets by relevant laws and regulations)

Others

  • Appropriate and efficient management by our team of professional asset managers
  • Organizational division for increased management efficiency (front, middle, and back offices)
  • Investors’ deposits management using the optimal computer system

History

  • 2010's
    Feb. 2010 Number of depositing companies reached 38
    Jan. 2014 Number of depositing companies reached 39
    May. 2017 Number of depositing companies reached 34
  • 2000's
    Mar. 2002 Obtained preliminary approval for the trust business (from the Financial Supervisory Commission)
    Nov. 2002 Obtained approval for the trust business
    Dec. 2002 Initiated the investors’ deposits trust business
    Jul. 2006 Number of depositing companies reached 28
    Feb. 2009 Obtained approval for the financial investment business (including the investors’ deposits special money trust business)
    Apr. 2009 Number of depositing companies reached 33