Citi declined to comment, but a source close to the bank said it was forced to withdraw its application because the Financial Supervisory Service, the executive arm of Korean regulator the Financial Supervisory Commission (FSC), "changed the requirements" and that the bank is likely to re-apply at some undisclosed point. A Morgan Stanley spokesperson said the bank doesn't comment on licence applications. The FSC also declined to comment for this article.
An Asia Risk source says the FSC has told firms that the next round of applications can be submitted in September. It is understood that Deutsche Bank and UBS are making preparations to apply for licences, although spokesmen for both banks declined to comment.
Macquarie Securities Korea in March became the first – and remains the only – foreign dealer to obtain a full OTC licence.