S. Korea to join global stress test on banking sector

S Korea-global stress test

S. Korea to join global stress test on banking sector

SEOUL, April 24 (Yonhap) -- South Korea's central bank and financial regulator said Monday that they will conduct a stress test on local banks under the guidelines offered by global banking watchdogs.

The Bank of Korea and the Financial Supervisory Service will jointly conduct a stress test compiled by the Basel Committee on Banking Supervision (BCBS) and the Financial Stability Board (FSB) on local banks from this week until June.

The test will be conducted on the banks' capital adequacy, their exposure to external risks and the potential contagion of financial risks among players, according to the central bank.

The global stress test came as the global financial sector undergoes risks amid monetary tightening moves in major economies and a global economic slowdown.

The central bank said the global stress test will help enhance the banking sector's financial stability.

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