Amid growing scrutiny over single-stock leveraged exchange-traded funds as a driver of the domestic stock market's sharp decline, opposition voices are intensifying calls for a parliamentary investigation and a special prosecutor. The ruling party, while acknowledging the need for regulatory reform, has stopped short of actively endorsing those demands.
People Power Party leader Jang Dong-hyeok said at a supreme council meeting Thursday that "the stock market has ultimately become an odd-or-even gambling table," adding that the situation amounted to "criminal conduct that must be investigated through a parliamentary probe and a special prosecutor."
Calls for the dismissal of officials involved in introducing leveraged ETFs also mounted. PPP lawmaker Ahn Cheol-soo labeled presidential policy chief Kim Yong-beom, Financial Services Commission Chairman Lee Eok-won and Financial Supervisory Service chief Lee Chan-jin the "hopeless leveraged trio," urging President Lee Jae Myung to dismiss all three immediately.
Ahn said leveraged ETFs tied to Samsung Electronics and SK Hynix "are still operating," criticizing authorities for spending more than a month merely "reviewing supplementary measures" when delisting or trading halts should already be on the table.
A survey released Friday by the Reform Institute, the Reform Party's policy research arm, found that 61.0 percent of respondents said Kim should be replaced and held accountable for policy failures. A separate 75.5 percent said it was inappropriate for Kim to have cited retail investors' aggressive trading as a factor behind recent share price swings.
Pressure over the National Pension Service's asset rebalancing also continued. PPP supreme council member Woo Jae-jun, who sits on the National Assembly's special committee on pension reform, said the pension fund had delayed releasing minutes from its fund management committee meetings and scaled back disclosures on its currency-hedging operations, urging full disclosure going forward. PPP lawmaker Kim Ki-hyun also raised allegations that the pension fund's failure to adjust its weightings in Samsung Electronics and SK Hynix in a timely manner had fueled market overheating and the subsequent sharp selloff.
At a plenary session of the National Assembly's finance and economy planning committee Wednesday, lawmakers questioned officials at length about the process behind the leveraged ETF rollout — but most Democratic Party of Korea members were absent from the afternoon session. One PPP lawmaker on the committee said by phone that he felt "a sense of shame" watching ruling party members vacate their seats during questioning "while some 14 million retail investors are in tears."
The Reform Institute survey was conducted Wednesday via automated response system using wireless random-digit dialing among 504 adults aged 18 and older nationwide. The response rate was 1.73 percent, with a margin of error of plus or minus 4.4 percentage points at a 95 percent confidence level.
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