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KRX to celebrate 60th founding anniversary

By By Han Ye-kyung and Yong Hwan-jin, Maeil Business News Korea

The Korea Exchange (KRX) that has served as a fund counter for South Korean companies will celebrate the 60th anniversary of its founding on Thursday.

The Korean stock market opened with the establishment of Daehan Stock Exchange on March 3, 1956. The number of listed companies, which stood at a mere 12 in 1956, has increased 160 times to 1,927 in total, including 770 Kospi-listed companies and 1,157 Kosdaq-listed companies. The Kospi is an acronym for the country’s main bourse Korea Composite Stock Price Index, while the Kosdaq is the country’s secondary tech- and bio-heavy stock price index. The total market capitalization of companies listed on the Kospi, which came to 15 billion won ($12 million) in 1965, surged more than 80,000 times to 1,207 trillion won late last month. The combined market capitalization of the Kospi- and Kosdaq-listed firms also exceeded 1,400 trillion won, ranking 13th in the world as of end-January.

Photo courtesy of Pulse/Maeil Business News Korea

Photo courtesy of Pulse/Maeil Business News Korea

When it was established 60 years ago – four banks, six general firms, and two state-owned companies – were listed on the bourse. Among them, three companies, Kyungbang, Hanjin Heavy Ind. & Const. Holdings Co., and Eusu Holdings Co., have kept alive until now.

In the 1980s, the Korean stock market made great strides. The benchmark Kospi index hit 1,000 at the end of March in 1989 for the first time. In July 25, 2007, the index reached 2,000 for the first time. It took nine years and three months for the index to leap from 100 to 1,000 but 18 years and four months to climb from 1,000 to 2,000. It took longer for the index to reach the 2000 mark because the stock market was hit by the Asian financial crisis and the dotcom bubble bursts.

Starting with Malaysia in 2007, the KRX has also exported its stock exchange systems to six countries, mostly emerging markets including Vietnam, the Philippines, and Thailand. It also signed a memorandum of understanding (MOU) with Securities and Exchange Organization of Iran (SEO) in September last year for the modernization of Iran’s stock market.

The KRX, which is facing new challenges ahead of its 60th anniversary, has decided to move to push ahead with new market services such as over-the-counter platform, fully-electronic peer-to-peer transaction called blockchain service, and the bourse, Daehancentral counter party (CCP).