Definition of Collateral to be Disposed
In case of a default by a member, the KRX may, according to related rules, dispose the collateral provided by the member, to compensate the loss from the default concerned. In this case, the collateral to be disposed is the member’s securities under the suspension of payment according to related rules, or the underlying assets for netting settlement.
Scope and Period of Payment Suspension
When the need for disposal of collateral arises because of a default, the KRX determines the scope of payment suspension through a comprehensive review on matters such as the reason and the amount of the default, scope of the trading suspension and protection of customers. The suspension of payment begins from the date of the default and the ending date is determined by considering the amount of the default, etc.
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