SEOUL: South Korean financial authorities on Monday said they are inspecting six local banks that offer virtual currency accounts to institutions, amid concerns the increasing use of such assets could lead to a surge in crime.
The joint inspection by the Financial Services Commission (FSC) and Financial Supervisory Service (FSS) will check if banks are adhering to anti-money laundering rules and using real names for accounts, FSC Chairman Choi Jong-ku told a press conference.
The six banks named by the regulator have all provided virtual currency accounts to clients that handle cryptocurrencies, according to the FSC. The banks are NH Bank, Industrial Bank of Korea, Shinhan Bank, Kookmin Bank, Woori Bank and Korea Development Bank.
Choi said the inspections are intended to provide guidance to banks and are not the result of any suspected wrongdoing.
“Virtual currency is currently unable to function as a means of payment and it is being used for illegal purposes like money laundering, scams and fraudulent investor operations,” said Choi.
“The side effects have been severe, leading to hacking problems at the institutions that handle cryptocurrency and an unreasonable spike in speculation.”
A Woori Bank spokesperson told Reuters the bank was filling out a checklist for the inspection. The spokesperson said Woori had stopped providing virtual account services last month as the costs of using a real-name transaction system were too prohibitive.
NH Bank and Shinhan Bank representatives declined to comment, while the other three banks could not immediately be reached for comment.
Choi said authorities are also looking at ways to reduce risks associated with cryptocurrency trading in the country, which could include shutting down institutions that use such currencies.
Last month, the government said it would impose additional measures to regulate speculation in cryptocurrency trading within the country, including a ban on anonymous cryptocurrency accounts and new legislation to allows regulators to close virtual coin exchanges if needed.
Bitcoin and other virtual coins have been extremely popular in South Korea, drawing wide investments from housewives and students. Government officials have expressed concern over frenzied speculation, with South Korea’s central bank chief warning of “irrational exuberance” in trading of virtual currency last month.
A South Korean cryptocurrency exchange, Youbit, shut down and filed for bankruptcy in December after it was hacked twice last year, highlighting security and regulatory concerns.
South Korea’s virtual currency exchanges have been more vulnerable to hackers as bitcoin trades at higher rates on local exchanges than they do elsewhere. As of 0710 GMT, bitcoin’s global price average was trading at $16,294 while in South Korean markets, it stood at 25 million won, or $23,467.35, according to Coinhills.com.
South Korea’s bitcoin prices are higher because of the extreme popularity of the virtual currency in the country, with buyers greatly outnumbering those willing to sell, said Park Nok-sun, a cryptocurrency analyst at NH Investment & Securities.
The fact that some of the most active virtual currency exchanges in the world are in South Korea also makes the country an attractive target for hackers, he added.
Choi warned on Monday authorities would crack down on virtual currency crime and dole out heavy punishments on those who partake in market price manipulation, pyramid schemes and money laundering.
“No one knows what is going on at these places that handle cryptocurrency because there is no direct regulation system in place regarding these institutions,” Choi said.
South Korea inspects 6 banks over virtual currency services to clients
South Korea inspects 6 banks over virtual currency services to clients
Arab food and beverage sector draws $22bn in foreign investment over 2 decades: Dhaman
JEDDAH: Foreign investors committed about $22 billion to the Arab region’s food and beverage sector over the past two decades, backing 516 projects that generated roughly 93,000 jobs, according to a new sectoral report.
In its third food and beverage industry study for 2025, the Arab Investment and Export Credit Guarantee Corp., known as Dhaman, said the bulk of investment flowed to a handful of markets. Egypt, Saudi Arabia, the UAE, Morocco and Qatar attracted 421 projects — about 82 percent of the total — with capital expenditure exceeding $17 billion, or nearly four-fifths of overall investment.
Projects in those five countries accounted for around 71,000 jobs, representing 76 percent of total employment created by foreign direct investment in the sector over the 2003–2024 period, the report said, according to figures carried by the Kuwait News Agency.
“The US has been the region's top food and beverage investor over the past 22 years with 74 projects or 14 projects of the total, and Capex of approximately $4 billion or 18 percent of the total, creating more than 14,000 jobs,” KUNA reported.
Investment was also concentrated among a small group of multinational players. The sector’s top 10 foreign investors accounted for roughly 15 percent of projects, 32 percent of capital expenditure and 29 percent of newly created jobs.
Swiss food group Nestlé led in project count with 14 initiatives, while Ukrainian agribusiness firm NIBULON topped capital spending and job creation, investing $2 billion and generating around 6,000 jobs.
At the inter-Arab investment level, the report noted that 12 Arab countries invested in 108 projects, accounting for about 21 percent of total FDI projects in the sector over the past 22 years. These initiatives, carried out by 65 companies, involved $6.5 billion in capital expenditure, representing 30 percent of total FDI, and generated nearly 28,000 jobs.
The UAE led inter-Arab investments, accounting for 45 percent of total projects and 58 percent of total capital expenditure, the report added, according to KUNA.
The report also noted that the UAE, Saudi Arabia, Egypt, and Qatar topped the Arab ranking as the most attractive countries for investment in the sector in 2024, followed by Oman, Bahrain, Algeria, Morocco, and Kuwait.
Looking ahead, Dhaman expects consumer demand to continue rising. Food and non-alcoholic beverage sales across 16 Arab countries are projected to increase 8.6 percent to more than $430 billion by the end of 2025, equivalent to 4.2 percent of global sales, before exceeding $560 billion by 2029.
Sales are expected to remain highly concentrated geographically, with Egypt, Saudi Arabia, Algeria, the UAE and Iraq accounting for about 77 percent of the regional total. By product category, meat and poultry are forecast to lead with sales of about $106 billion, followed by cereals, pasta and baked goods at roughly $63 billion.
Average annual per capita spending on food and non-alcoholic beverages in the region is projected to rise 7.2 percent to more than $1,845 by the end of 2025, approaching the global average, and to reach about $2,255 by 2029. Household spending on these products is expected to represent 25.8 percent of total expenditure in 13 Arab countries, above the global average of 24.2 percent.
Arab external trade in food and beverages grew more than 15 percent in 2024 to $195 billion, with exports rising 18 percent to $56 billion and imports increasing 14 percent to $139 billion. Brazil was the largest foreign supplier to the region, exporting $16.5 billion worth of products, while Saudi Arabia ranked as the top Arab exporter at $6.6 billion.
