South Korea will launch a wider probe into local banks and brokers which sold exotic notes linked to Chinese stocks amid concerns that the securities may saddle investors with heavy losses.
Authorities will start investigating 12 institutions including KB Kookmin Bank and Korea Investment & Securities to determine if there was any wrongdoing over the sale of equity-linked securities that are tied to the Hang Seng China Enterprises Index, according to the Financial Supervisory Service.
The watchdog said it uncovered several issues, including the practice of pushing bankers to aggressively market high-risk notes that are hard for retail investors to understand.
In other news, China sanctioned five US defense firms - BAE Systems Land and Armament, Alliant Techsystems Operation, AeroVironment, ViaSat and Data Link Solutions - in response to recently announced new arms sales to Taiwan.
