Kwon Dae-young, first vice minister at the Ministry of Economy and Finance, said the Financial Services Commission made the final call on introducing single-stock leveraged exchange-traded funds (ETFs). He drew a line under allegations that the policy was pushed through by quelling internal opposition during the rollout. He expressed regret over losses later suffered by retail investors.

Kwon told a parliamentary audit of the Ministry of Economy and Finance on Oct. 6, in response to a question from People Power Party lawmaker Park Soo-young, that the FSC made the final decision.

He also addressed claims that the introduction was discussed at a closed-door meeting led by then presidential policy chief Kim Yong-beom and that there was significant opposition within the FSC.

Kwon, who was the FSC vice chairman at the time, denied an accusation that he led the rollout by settling internal opposition, saying, "That is not the case." He said the FSC held a balanced view that it would rise sharply when it rose and fall sharply when it fell.

On remarks by Kim suggesting FSC staff opposed the introduction, Kwon said it did not seem appropriate for him to respond because it was the chief's interview, and avoided a direct assessment.

Kwon cited the need to address regulatory differences between domestic and overseas products as a reason for introducing single-stock leveraged ETFs.

He expressed a sense of responsibility over expanded investor losses after the system was introduced. "I feel heavily about this situation," he said. "I am sorry that the FSC's decision to ease regulatory asymmetry has, as a result, caused losses to the public."

He also denied allegations that political judgment influenced the timing of the product's introduction or the policy decision-making process.

"I did not make any political considerations, nor did I neglect my duty as a faithful administrator in the process of promoting policy," Kwon said.