Lombard loans in South Korea.
Private credit against South Korea-listed shares — pledged, not sold, with ownership retained.
A Lombard loan against South Korea-listed shares is credit secured by a pledge of equity listed on the KRX. The holder pledges the shares as collateral, draws cash against a fraction of their market value, keeps beneficial ownership and dividends subject to structuring, and recovers the position in full on repayment. Known locally in some markets as “주식담보대출”, the instrument is the same: a loan secured by a pledge of listed shares.
- Lombard loans are arranged against shares listed on the KRX (KRX).
- The pledge is not a sale: ownership, dividends, and the upside stay with the holder.
- Loan-to-value is calibrated to the specific position, funded in KRW or cross-currency.
- Structured under the FSC / FSS regime, with disclosure from 5%.
Eligible collateral and venues
Lombard Financing arranges facilities against equity listed on the principal South Korea venue: Korea Exchange (KRX). Eligibility at the position level turns on the liquidity and free float of the specific line, its volatility, and the size of the holding relative to its typical traded volume — the same variables that drive the loan-to-value.
Regulator and disclosure
Shares listed in South Korea are regulated by Financial Services Commission / Financial Supervisory Service (FSC / FSS). Substantial-shareholding disclosure is triggered from 5%, and a pledge over a large line is structured with that reporting regime in view so that the transaction remains discreet and compliant. Where a holding sits near a control or takeover threshold, the structure is arranged to avoid disturbing the position.
Funding, custody, and structuring
Facilities are typically arranged for a tenor of twelve to thirty-six months, funded in KRW or in another currency on a cross-currency basis. Throughout the facility the pledged shares are held by a qualified custodian under bankruptcy-remote arrangements, so the security is clean and the holder’s ownership is preserved. Non-recourse, limited-recourse, and full-recourse structures are available, and the choice interacts with the loan-to-value and the pricing.
| Listing venue(s) | Korea Exchange (KRX) |
|---|---|
| Regulator | Financial Services Commission / Financial Supervisory Service (FSC / FSS) |
| Currency | KRW (cross-currency available) |
| Disclosure threshold | From 5% substantial-holding disclosure |
| Principal indices | KOSPI 200, KOSPI Composite, KOSDAQ 150 |
| Indicative tenor | 12–36 months, renewable by agreement |
| Recourse | Non-recourse / limited-recourse / full-recourse |
Considering a Lombard loan against a South Korea-listed position?
Request terms →Lombard loans across Asia-Pacific.
On this market, specifically.
Disclosure and regulation
Korea’s large shareholding rules sit in Article 147 of the Financial Investment Services and Capital Markets Act: a holder reports at 5% and again on each 1% change, within a ten-day filing window for general investors, under the oversight of the FSC and FSS. A share-secured loan — 주식담보대출 in the local market — leaves the client as the reporting holder, so a Lombard pledge must be reflected in those filings rather than mistaken for a sale. Where a founder’s stake also engages purpose-of-holding or control considerations, we plan the disclosure sequence so a financing step is never read as a shift in intent.
An illustrative example
Illustratively only: a founder holding KRW 30 billion of a KOSPI 200 constituent might arrange a Lombard loan at a measured 45% loan-to-value, within the indicative 20–65% range, releasing around KRW 13.5 billion in liquidity while retaining ownership, votes and dividends. The facility can be drawn in won or converted into USD or CHF for offshore use. The amounts are hypothetical; a live advance would be set against the specific name’s free float and turnover, with more conservative terms for a volatile KOSDAQ line than for a large, liquid KOSPI 200 leader.
Illustrative only — not an offer, a quotation, or a commitment to lend.