South Korea’s New Product Approval (NPA) bill that will force banks to seek approval before selling new types of over-the-counter (OTC) derivatives has passed through the legislation and judiciary committee.
The bill received initial approval on February 16. It is expected to be passed on February 26 in the assembly plenary session.
If passed, the law will have a dramatic effect on institutions selling derivatives in the country. Any new credit derivatives will have to be reviewed by the newly established Korea Financial Investment Association (Kofia), regardless of the counterparty. And...