South Korea says it will impose fines on two global banks for short-selling violations

SEOUL (Reuters) - South Korea's financial regulator on Sunday said it plans to impose penalties on two unnamed global investment banks it is investigating.

The Financial Services Commission said it found two global investment banks were engaged in the practice of naked short-selling transactions, which involves selling shares without borrowing them first.

The FSC did not identify their names.

South Korea has been widening a probe into global investment banks to weed out illegal short-sellers from the local stock market after it imposed a full ban on short-selling in November through the end of June 2024.

In December, it said it would fine two unnamed global investment banks and one local brokerage 26.5 billion won ($20.2 million) in total for naked short-selling.

($1 = 1,313.2200 won)

(Reporting by Cynthia Kim; Editing by Chris Reese)