Good afternoon all.
Capital Markets Bureau at FSC held its regular press briefing this afternoon, September 6, 2012.
The briefing brought up two issues; 1) recent trends in bonds market, and 2) ELS and DLS trends and related measures for improvement. Many reporters were at the briefing room, as usual. Particularly, the second part of the briefing got lots of attention from the reporters. This is because demands for ELS (Equity-Linked Securities) and DLS (Derivatives-Linked Securities) are ever-increasing in financial markets.
Responding to this trend in the market, FSC has been studying the measures to improve ELS and DLS system. This study was planned as a part of ‘FSC annual operational planning for 2012.’ An interim report of the study says that ‘protection measures for investors will be enhanced, considering investors’ vulnerabilities to the issuer’s credit risk.
The final report will come out soon in next month, October 2012. It is also planned that ‘Standard for ELS and DLS issuance and operation’ will be set this month, for the purpose of enhancing soundness in financial markets. It is expected to regulate the excessive issuance of ELS and DLS. FSC will regularly keep watching and monitoring market conditions so as to pursue the most appropriate measures. Of course I will bring up the next briefing held by Capital Markets Bureau when the final report comes out!