Korea’s competition watchdog hands 15 primary dealers its largest fine ever for rigging government bond auctions from 2020 to 2023.
MoneyTurkey Bonds Desk | 11 November 2026
Key points
- South Korea’s Fair Trade Commission fined 10 brokerages and five banks a combined 1.63 trillion won ($1.2 billion) over 150 government bond auctions.
- In 145 of those auctions the dealers agreed on bidding yields or volumes, the commission said.
- It is the largest fine the commission has imposed in a single case, and seven firms have been referred for criminal investigation.
South Korea’s Fair Trade Commission said on Wednesday it will fine 15 primary dealers a combined 1.63 trillion won ($1.2 billion) for colluding in government bond auctions between January 2020 and June 2023. The regulator said the coordination artificially pushed up auction yields, which raised the government’s borrowing costs.
What happened
According to the commission, the dealers swapped their intended bidding yields by phone and on the Telegram messaging app, sometimes until one or two minutes before the deadline, across 150 auctions. In 145 of them they went beyond sharing information and agreed on specific bidding yields or volumes, which the regulator treats as bid rigging.
The 15 firms are the 10 brokerages Kyobo, Daishin, Meritz, Mirae Asset, Samsung, Shinhan, NH Investment & Securities, KB, Kiwoom and Korea Investment & Securities, plus five banks: KB Kookmin, NH NongHyup, Industrial Bank of Korea, Hana and Korea Development Bank. KB Securities faces the biggest single fine, 332.1 billion won (about $245 million), followed by NH Investment & Securities at 242.7 billion won (about $179 million).
The total beats the commission’s previous record of 1.03 trillion won (about $760 million), imposed on Qualcomm in 2016, Yonhap reported. The regulator also issued corrective orders, and seven of the firms have been referred for criminal investigation.
Why it matters
Primary dealers are the small group of banks and brokerages that buy most new Korean government bonds at auction, and those auction yields feed into the benchmark curve used to price corporate bonds and other products. A finding that the group pushed yields higher for three and a half years raises questions about how competitive that price-setting has been, and about the extra interest the government paid. The commission did not put a figure on that extra cost, according to Aju Press.
What to watch
- Whether the dealers appeal the fines
- The outcome of the criminal referrals for the seven firms
- Any changes the government makes to how primary dealers bid at auctions
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For information only. Not investment advice.
Sources
- Yonhap: https://en.yna.co.kr/view/AEN20261111005300320
- Reuters via CNA: https://www.channelnewsasia.com/business/south-korea-fines-15-bond-dealers-16-trillion-won-collusion-6541701
- SBS: https://news.sbs.co.kr/english/article.do?news_id=N1008841421
- MoneyToday: https://www.mt.co.kr/en/economy/2026/11/11/2026111109032210486
- Aju Press: https://www.ajupress.com/view/20261111132926033
- The Economic Times: https://economictimes.indiatimes.com/markets/us-stocks/wall-street-guide/south-korea-fines-15-brokerages-banks-1-2-billion-for-bond-auction-collusion/articleshow/135727840.cms
