Naked Short-Selling Crackdown: HSBC and BNP Paribas Hit With Fines In South Korea
Portfolio Pulse from Lekha Gupta
HSBC Holdings PLC and BNP Paribas have been fined a total of 26.5 billion won ($20.4 million) by South Korean authorities for engaging in naked short-selling, which is illegal in the country. BNP Paribas and its local brokerage unit are ordered to pay 19 billion won, while HSBC is fined 7.5 billion won. The Securities and Futures Commission of South Korea views these violations as intentional and damaging to market order and investor trust. The FSC is also considering a criminal investigation against the banks. This action aligns with South Korea's efforts to eliminate illegal short-selling, including a planned full ban by June 2024.
December 26, 2023 | 4:14 pm
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NEGATIVE IMPACT
BNP Paribas and its local brokerage unit in South Korea have been collectively fined 19 billion won for engaging in naked short-selling. This could lead to a loss of investor confidence and a tarnished reputation in the market.
The fines levied on BNP Paribas for illegal naked short-selling are substantial and could harm the bank's image, potentially affecting its stock price negatively in the short term. The ongoing crackdown on such practices by South Korean authorities further emphasizes the seriousness of the issue.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
HSBC Holdings PLC has been fined 7.5 billion won by South Korean authorities for illegal naked short-selling, which could negatively impact investor confidence and the company's reputation.
The fine imposed on HSBC for illegal activities is likely to affect investor sentiment negatively, potentially leading to a short-term decline in stock price. The severity of the fine and the mention of a possible criminal investigation increase the likelihood of a negative impact.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80