At a parliamentary audit of the Financial Services Commission by the National Assembly’s Political Affairs Committee, lawmakers clashed over a string of hacks at financial firms, single-stock leveraged exchange-traded funds (ETFs) and property loan regulations.

On the hacking incidents, concerns were raised that different inspection periods across financial companies could cause them to miss traces of attacks. Some banks were singled out for checking only the past 3 months of access records.

Calls also emerged to revise network separation rules to respond to hacking threats using artificial intelligence (AI) and to expand AI security systems to smaller financial firms.

Lapses in security management were also raised over a data leak involving merchant payment information at Toss Payments. Toss Payments acknowledged shortcomings and said it would strengthen security management and oversight up to the merchant level.

In the introduction of single-stock leveraged ETFs, responsibility for policy decisions and investor losses became key issues. Kwon Dae-young (권대영), first vice finance minister, said the Financial Services Commission made the final decision to introduce them.

Toss’s push to enter online investment-linked financing drew concerns about disrupting competitive order as a large financial platform enters the market and potential conflicts of interest between loan brokerage and product supply.

Disputes also continued over the effectiveness of property loan regulations. Financial Services Commission Chairman Lee Eok-won (이억원) said home prices would have risen more without the regulations.

Discussions also covered the institutionalisation of digital assets and state-run banks’ investment and bond management, with the supervisory responsibility of financial authorities and policy effectiveness emerging as key issues.

• [Audit 2026] "No issues after looking at only 3 months?" Poor inspections of hacking in the financial sector under fire • [Audit 2026] "Hackers use AI but banks cannot... review easing network separation rules" • [Audit 2026] Toss Payments admits inadequate management of information leak... "Strengthen management and oversight up to merchants" • [Audit 2026] Intensive questioning over security holes and ETF losses... loan and digital asset rules also under scrutiny • [Audit 2026] Kwon Dae-young: "Financial Services Commission decided to introduce single-stock leveraged ETFs" • [Audit 2026] Will Toss be blocked from entering online investment-linked financing... conflict-of-interest controversy • [Audit 2026] Dispute over effectiveness of loan curbs... Lee Eok-won: "Home prices would have risen more without regulations" • From leverage losses to financial-sector hacking... investment industry on edge ahead of audit

As police investigations intensify into the hacking incidents, financial authorities and the industry are also stepping up security responses.

As of Oct. 6, the Financial Supervisory Service identified 28 internet protocol (IP) addresses linked to the intrusions, excluding duplicates, and shared the information with financial companies.

KakaoBank, K Bank and Toss Bank also confirmed access attempts through the IPs, but authorities have found no actual damage such as customer data leaks. Similar intrusion traces were found at some insurers and securities firms, and an additional personal data leak was confirmed at an online investment-linked financing company.

The National Police Agency’s National Investigation Headquarters formed a dedicated team of 28 investigators and began probing intrusion routes by financial company, attack methods and links among cases.

The watchdog ordered 21 major securities firms to conduct a full recheck of their IT security systems. It also asked them to quickly assess potential investor harm and take necessary protective measures.

The Korea Fintech Industry Association also held a meeting with financial authorities to share response cases and took pre-emptive steps such as blocking suspicious IPs, analysing past access logs and checking vulnerabilities in externally exposed IT assets.

Separately, Woori Bank is expanding cooperation to prevent financial fraud, including strengthening its system to detect signs of voice phishing by linking financial and telecom data with LG Uplus.

• Financial-sector hacking spreads broadly... 28 attack IPs identified and police launch probe • Fintech association strengthens hacking response... checks suspicious IPs and externally exposed assets • FSS orders securities firms to recheck IT security... "Immediate response to investor harm" • Woori Bank strengthens voice phishing detection with LG Uplus... links financial and telecom data

As talks on institutionalising digital assets gain momentum, financial authorities are speeding up regulatory work while the financial sector accelerates competition in new businesses.

Financial Services Commission Chairman Lee said at the audit that final-stage consultations are under way on the second phase of legislation for the Digital Asset Basic Act, including institutionalising stablecoins.

He said the government would quickly settle key issues such as a won-denominated stablecoin issuance framework and licensing for digital asset exchanges, and set up a system to avoid falling behind global trends.

Concerns were also raised about fairness in the licensing process for an over-the-counter market for fractional investment. The commission said it sympathised with the sense of frustration after Lucentblock failed to win preliminary approval, but said the screening process was fair.

The government is also pushing a plan to manage records of digital assets moving to overseas exchanges and personal wallets through the Bank of Korea’s foreign exchange computer network. It plans to revise enforcement rules of the Foreign Exchange Transactions Act with a target implementation date of Dec. 3 to strengthen monitoring of cross-border fund flows and responses to illegal transactions.

In the financial sector, cooperation is expanding between securities firms and blockchain and platform companies ahead of the token securities (STO) system taking effect in February next year.

Korea Investment & Securities, KB Securities, Shinhan Investment & Securities and DB Financial Investment are among those building business foundations spanning issuance to distribution and settlement as they move to pre-empt the market.

• [Audit 2026] "Digital Asset Basic Act in final stage... we will not fall behind global trends" • [Audit 2026] FSC: "Fractional investment OTC exchange licensing was fair... we sympathise with operators' frustration" • Overseas digital asset transfers will also leave records... government to strengthen tracking of cross-border transactions • From issuance to distribution and settlement... token securities alliances accelerate

As demand grows for corporate cash management and payment services using digital assets, cooperation between banks and fintech firms is becoming more active.

As demand from large companies for blockchain-based on-chain cash management emerges as a new financial market, joint infrastructure building and response capabilities in the banking sector are becoming more important.

Toss completed a proof of concept for stablecoin-based QR payment technology with Gwangju Bank. It implemented a structure in a virtual merchant environment in which payment and settlement are confirmed simultaneously and is preparing follow-up verification for application in actual stores.

Sh Suhyup Bank is participating in a trial of Infinite Block’s blockchain-based prepaid top-up fund management solution. It will test technology to cross-check and verify issuance balances and deposit status in real time.

Mergers in the digital asset sector are being delayed somewhat. The stock-swap schedule for Naver Financial to make Dunamu a wholly owned subsidiary was postponed again to March 31 next year due to reviews by relevant authorities.

Dunamu also urged investors to be cautious as cases increased of inducing lending or purchases of Upbit accounts and API keys. It said it would strengthen responses, including account suspensions and reporting to investigative agencies when such acts are detected.

• Big companies' on-chain cash demand expands... joint banking response will decide the outcome • Sh Suhyup Bank joins trial of Infinite Block prepaid top-up verification solution • Toss completes stablecoin QR payment proof of concept with Gwangju Bank • Naver Financial-Dunamu stock swap delayed again... to March 31 next year • Dunamu issues warning on lending Upbit accounts and API keys... "Suspension and reports when detected"

With retirement pension reserves topping 500 trillion won, securities firms are also intensifying competition over pension platforms.

Securities firms are strengthening digital wealth management services and seeking to attract customers as demand rises for investment products such as ETFs.

The investment industry is also expanding overseas cooperation. The Korea Financial Investment Association signed a memorandum of understanding with the Investment Trusts Association, Japan, and agreed to promote information sharing and personnel exchanges related to the asset management markets of both countries.

The two organisations also plan to cooperate on boosting competitiveness in the asset management industry and supporting long-term asset building through joint seminars and workshops.

• Win the 500 trillion won retirement pension market... competition among securities firms’ pension platforms heats up • KOFIA signs MOU with Japan asset management association... expands Korea-Japan cooperation in asset management

South Korea’s stock market remains weak despite strong results from Samsung Electronics, drawing attention to what could drive a rebound.

Expectations for improving semiconductor conditions persist, but continued selling by foreign and institutional investors suggests supply-and-demand factors and external variables are steering the market more than corporate earnings.

In the market, key variables for a KOSPI rebound are seen as earnings outlooks for major companies and whether foreign funds flow in.

U.S. stocks are also seen facing potential headwinds even as the Nasdaq marks record highs, with higher Treasury yields and concentration in large technology stocks cited as burdens that could raise volatility.

With overseas investment demand growing, including South Korean investors’ U.S. stock holdings surpassing $200 billion, attention is also on whether investor sentiment in the domestic market recovers.

This week, U.S. inflation data and earnings at global semiconductor companies are cited as variables that could shape market direction. Market volatility is expected to persist depending on rate moves and changes in foreign fund flows.

• [Market outlook] Samsung Electronics earnings did not help... what is the key to a KOSPI rebound? • KOSPI falls 2.62 percent despite record Samsung Electronics results as foreigners and institutions sell 3.6 trillion won • Nasdaq at record highs but bonds warn... U.S. market 'warning signs' • Surge in 'seohak ants' again... U.S. stock holdings surpass $200 billion • Court blocks delisting based on market cap... exchange: "Follow-up procedures deferred"

In the financial sector, services using AI and data technologies to improve customer convenience are appearing in succession.

Toss Bank expanded a generative AI-based chat agent to all customers, cutting consultation time by about 90 percent from previous levels.

Banksalad launched a "Monthly Money Report" that analyses monthly income and spending and changes in net assets, strengthening personal asset management features. Kookon supplied Hyundai Marine & Fire Insurance with an API to retrieve pet registration information, enabling subscription information to be verified without separate supporting documents.

Across financial services, automation and improvements in user convenience through AI and data linkages are expanding.

• Toss Bank expands 'AI chat agent' to all customers... cuts consultation time by 90 percent • Banksalad analyses monthly cash flows... unveils 'Monthly Money Report' • NHN KCP pays freight drivers' transport fees earlier... pilots win-win payment programme • Kookon supplies API to Hyundai Marine pet insurance to query pet registration information • Five European payment firms join forces... launch joint payment network ENP

Other major moves in finance and fintech were also compiled.

KB Kookmin Bank signed a business agreement with Naver Pay, Korea Information & Communications and Easyshop to expand support for small merchants’ digital transformation and financial assistance. Shinhan Financial expanded exchanges with Koreans in Japan to mark the 80th anniversary of the founding of Mindan, and Shinhan Bank took on financial arrangement worth 2.28 trillion won for the Bokjeong Station area development project. It also signed a business agreement with Yonsei University’s technology holding company and decided to strengthen cooperation to discover and support the growth of innovative startups.

• KB Kookmin Bank cooperates with Naver Pay, Korea Information & Communications and Easyshop to support small merchants • Shinhan Financial expands exchanges with Koreans in Japan on Mindan's 80th anniversary • Shinhan Bank arranges 2.28 trillion won financing for Bokjeong Station area development • Shinhan Bank signs deal with Yonsei University technology holding company to support innovative startups

Hana Bank wrote off 134.3 billion won in long-term delinquent debt, easing the debt burden for 5,738 people, and will work with Naver Pay and the Seoul Credit Guarantee Foundation to support 68.75 billion won in guaranteed loans for alleyway commercial districts in Seoul. Woori Bank launched a loan product for exporters and expanded corporate finance by providing up to an additional 15 percent in facility loan limits. It also decided to strengthen its system to detect signs of voice phishing by linking financial and telecom data with LG Uplus.

• Hana Bank writes off 134.3 billion won in long-term delinquent debt... eases debt burden for 5,738 people • Hana Bank provides 68.75 billion won to Seoul alleyway commercial districts... cooperates with Naver Pay and Seoul Credit Guarantee Foundation • Woori Bank launches exporter-only loans... expands facility loan limits by up to 15 percent • Woori Bank strengthens voice phishing detection with LG Uplus... links financial and telecom data

NH Nonghyup Financial Group plans to create a "Southwestern NH Financial Hub" in the fourth quarter this year to support strategic industries such as AI, semiconductors and renewable energy in the Jeonnam-Gwangju Integrated Special City. It also plans a special contribution of 5 billion won to regional guarantee institutions. BNK Financial Group said it would implement "Value-up 2.0" by reviewing business portfolios by affiliate and reorganising its management system around profitability and capital efficiency. Sh Suhyup Bank will reopen discussions after again failing to decide a candidate for chief executive.

• NH Nonghyup Financial pushes to create a southwestern financial hub... supports strategic industries in Jeonnam-Gwangju • BNK Financial strengthens value-up execution system... reorganises around profitability and capital efficiency • Suhyup Bank again fails to pick next CEO candidate... to revisit in late October to early November

KakaoBank said cumulative overseas remittance transactions topped 5 million and it is expanding fee waivers to bolster the competitiveness of its remittance service. K Bank plans to temporarily suspend financial transactions early on Oct. 18 for a system update.

• KakaoBank overseas remittance transactions top 5 million... expands fee waivers • K Bank to temporarily suspend financial transactions early on the 18th... system update

Mirae Asset Securities will cut the interest rate on stock-backed margin loans by up to 2 percentage points. Meritz Securities began cooperating with Ripple on digital asset custody and tokenisation businesses. MBK Partners cancelled 2.4 million Homeplus shares at no cost, extinguishing a 2.5 trillion won stake.

• Mirae Asset Securities cuts interest rates further on stock-backed margin loans • Meritz Securities cooperates with Ripple on digital asset business... reviews custody and tokenisation infrastructure • MBK cancels 2.4 million Homeplus shares at no cost... 2.5 trillion won stake extinguished

OK Financial Group signed a main contract to acquire Yesbyul Non-life Insurance and moved to enter the non-life insurance business, with plans to increase headcount. It is also participating in the bidding to acquire JoongAng Ilbo and is conducting due diligence, pursuing business expansion spanning insurance and media.

• OK Financial signs main contract to acquire Yesbyul Non-life Insurance... enters insurance business and plans to double staff