Korea Exchange is speeding up its AI shift by applying AI technology to key capital-market operations after acquiring AI startup FairLabs.

Korea Exchange said on Tuesday it is introducing AI technology, together with FairLabs, into core operations such as listed-company disclosures, market measures and its index business.

The exchange and FairLabs launched an "AX consultative body" immediately after the acquisition. They are pursuing major tasks by rapidly building demo versions that reflect ideas from business units and improving completeness through working-level feedback.

The first area of application is real-time detection of important information on listed companies. The exchange introduced FairLabs' AI technology to quickly collect information from a vast amount of domestic and overseas news each day, including embezzlement and breach of trust and defaults, that could be directly linked to trading suspensions.

The existing keyword-search method had limitations because it also surfaced information with low relevance or duplicated content. The solution developed by FairLabs uses AI-based contextual inference to analyse news content, select important information that requires actual market measures and deliver it to practitioners.

The exchange views the solution as likely to help it respond to changes in the market environment, such as extended trading hours. It aims to raise the completeness of its response to disclosure work by identifying important information in a timely manner.

AI is also being used in procedures for reviewing disclosure materials and verifying market measures. The exchange is developing a function in which AI analyses disclosure materials and then checks and provides reports on stocks that require market measures, such as designation or removal of issues on the administrative list, the next day. The exchange plans to use this to improve speed and accuracy.

FairLabs' technology is also being applied to the index business. The exchange plans to automate management processes by introducing AI across the management of the industry classification system, which forms the basis of index development. It said AI will analyse companies' sales composition and detailed business areas to improve the accuracy of industry classification, and that this will also lead to the development of micro-sector indices that reflect the latest industry trends and new growth themes.

A micro-sector index is an index designed to improve the accuracy of component selection for specific technologies and themes based on information that classifies corporate sales by subdividing them by business. The exchange expects this to help strengthen the competitiveness of its information business, including data and indices.

FairLabs was recently selected as the lead organisation for a 4.1 billion won cultural technology research and development project promoted by the Ministry of Culture, Sports and Tourism and others. Six specialised organisations, including JTBC and the Korea Advanced Institute of Science and Technology (KAIST), are participating in the project.

FairLabs will be responsible for key processes such as collecting global web and platform data, refining and standardising it, and operating integrated datasets. It will also take charge of overall project management.

The exchange plans to expand the scope of cooperation with FairLabs beyond technical support for internal operations to external revenue-generating businesses. It particularly aims to increase business competitiveness and synergy by linking it with information businesses such as data and indices.

A Korea Exchange official said, "Collaboration with FairLabs will further improve the accuracy and reliability of listed-company disclosures and market operations." The official added, "We hope FairLabs can grow into a specialised company that creates AI results across various industries beyond finance."