SEOUL: South Korean financial authorities are investigating whether two Deutsche Bank units caused a stock market plunge last November through market manipulation or unfair transactions, the Financial Services Commission said Monday.
Spokesman Ernst Lee said authorities are investigating the bank's Hong Kong unit as well as its securities unit in South Korea, but have not decided when they will issue a ruling.
FSC vice chairman Kwon Hyouk-Se said last month the commission would announce the results of the investigation by March at the latest.
Deutsche Bank declined to comment.
Authorities have been probing Deutsche Bank's involvement in an incident in which Seoul's benchmark KOSPI index fell 48 points in the last 10 minutes of trading, due to arbitrage trading between the spot and futures markets.
During the final 10 minutes of trade on November 11, an options expiry day, 2.4 trillion won ($2.16 billion) in sell orders from foreign investors were processed.
The bulk of these were processed through Deutsche's local securities unit.
The watchdog Financial Supervisory Service sent a team of officials to Deutsche's Hong Kong unit in December as part of the probe.
Local authorities last month announced new rules designed to reduce the risk of sharp stock market volatility triggered by derivatives trading. Seoul has grown increasingly concerned at potential risks posed by rapid foreign capital flows.
Comments
Comments are closed for this article.