E*Trade to Make Debut in Korea
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E*Trade, the largest online stock brokerage service in the United States, and investor Softbank will join forces with LG Investment Securities to penetrate the Korean market, according to industry sources.
E*Trade's debut in the Korean market is expected to have a great influence on domestic securities firms, which are gradually expanding online brokerage services, as well as newly established cyber securities firms such as KTB Securities.
Sources said that the projected joint venture among E*Trade, LG and Softbank will be capitalized at 10 billion won (about US$8.3 million). Softbank will be the leading shareholder with a 40 percent stake, with the remaining ownership shared by LG (15 percent), E*Trade (10 percent) and other Korean shareholders (35 percent).
LG officials said that the online brokerage firm would be established in November and would begin operating at the beginning of next year.
At present, online stock trading in Korea is growing at an explosive pace. According to the Korea Securities Dealers Association, Korea's online stock trading exceeded more than 30 percent of the total 51.01 trillion won (about US$42.5 billion) worth of trading during September.
It represented 32.2 percent of the total stock trading volume for the month, compared with 29 percent in August. By turnover total, however, it declined 9.9 percent because of sluggish trading during the month.
The number of cyber stock traders increased to 1.31 million accounts in September, showing a 10.3 percent increase from the previous month. The climb slowed from the previous monthly average increase of more than 20 percent.