South Korea’s Hana Bank accepted the Financial Supervisory Service‘s (FSS) compensation guidelines for customers who suffered losses from equity-linked securities (ELS) tied to Hong Kong’s Hang Seng China Enterprises Index (HSCEI), following an earlier move by Woori Bank.

Hana Bank said on Wednesday that it passed a resolution to accept the FSS‘s guidelines during a board meeting and will promptly come up with a voluntary compensation plan to begin the investor compensation process accordingly.

Hana Bank’s balance of HSCEI-linked ELS was approximately 2.03 trillion won ($1.5 billion) as of the end of 2023, and the amount entering the loss zone among the maturing portions in the first half of 2024 is approximately 750 billion won.

Hana Bank will also form a “HSCEI ELS Voluntary Compensation Committee” to oversee the compensation process. The committee will include three external experts to help organize and facilitate the compensation process.

By Park Na-eun and Yoon Yeon-hae

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