Gov't briefs investors on T+1 stock settlement road map

Seoul, November 11 (Yonhap) -- The South Korean government has informed global investors about the country's strategy to adopt the T+1 stock settlement system, according to a statement from the finance ministry on Wednesday. In a virtual discussion held the day before, Deputy Minister for International Economic Affairs Moon Ji-sung engaged with investors to discuss the transition from the current T+2 system, which requires stock trades to be settled two business days after the trade date.

Key participants in the meeting comprised major global asset managers, including BlackRock, Vanguard, and Amundi, alongside the Asia Securities Industry & Financial Markets Association (ASIFMA) and the Global Foreign Exchange Division (GFXD).

The government reassured that ample time will be provided for market participants to adapt their systems and procedures. Prior to the implementation, the South Korean authorities plan to carry out a minimum of six months of testing. However, investors expressed apprehensions regarding the potential increase in operational burdens and workload associated with a shorter settlement cycle.

In response to these concerns, participants urged for ongoing dialogues to tackle any challenges that might arise during the transition period, as reported by the finance ministry.