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Forex trading South Korea: South Korea is improving market access for foreign investors by allowing foreign banks to obtain quotes for dollar-won transactions from a broader range of banks in the onshore market.
On May 10, the first third-party foreign exchange transaction of the won took place between Kookmin Bank’s Singapore branch and Deutsche Bank’s London branch, involving a swap contract of approximately 30 billion won ($22.19 million), according to South Korea’s foreign exchange authorities. The transaction was settled on May 14.
Since last year, South Korea has permitted third-party foreign exchange trading. This change enables foreigners to select trading partners offering the best rates, eliminating the restriction of conducting transactions solely with banks where they hold accounts.
In February, South Korea’s foreign exchange authorities announced plans to ease regulations, making it simpler for investors to transfer won between Korean bank accounts and allowing foreign investors to use overdraft accounts to prevent settlement issues.
“Many believe that third-party foreign exchange transactions are not accessible in the Korean market, but the execution of this first case is significant and will pave the way for more transactions,” commented a foreign exchange official.
(With Reuters inputs)
