Clearstream and KSD sign agency agreement to facilitate Korean market access for foreign investors

On 30 August 2023, Clearstream and the Korea Securities Depository (KSD) signed an agency agreement in Luxembourg. This agreement meets global standards and allows for the implementation of an ICSD omnibus account structure to facilitate access to Korea Treasury Bonds (KTBs) and Monetary Stabilisation Bonds (MTBs) for foreign investors. With the omnibus account, foreign investors will no longer be required to apply for an Investor Registration Certificate (IRC) or open segregated accounts with a local custodian in Korea.

Enhancing market access for foreign investors

This step forward is the result of collaborative efforts to establish a cross-border link between Clearstream and the Korean CSD via a streamlined omnibus account operating model that is in line with global standards, following the signing of a Memorandum of Understanding (MoU) with Clearstream in December 2022.

"Today's signing is critically important as KSD and Clearstream have closely worked together and agreed to finalise legal and regulatory consultations," said Mr. Soonho Lee, Chairman and CEO of KSD. "In the coming months, both organisations will spare no efforts to establish an optimal cross-border link that can be trusted by market participants."

Philip Brown, CEO of Clearstream Banking S.A., added: "Having been the only ICSD to provide access to the Korean market via the existing IRC investment route for more than a decade, Clearstream is actively committed to establish a strong and reliable link between our ICSD and KSD, further encouraging foreign investment in the Korean market."

Next steps

The cross-border link between Clearstream's ICSD and KSD is expected to go live in the first half of 2024.

• Related Links

• Signing Memorandum of Understanding with KSD
• Market Link Guide - South Korea