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S Korean pension fund stops trading with Samsung Securities after fat finger error
[SEOUL] South Korea's biggest pension fund said on Tuesday it stopped trading stocks through Samsung Securities Co Ltd after fat finger error resulted in the accidental issuance of 2.8 billion shares to employees.
The public outcry over the mistaken issuance, more than 30 times the number of the broker's outstanding shares and theoretically worth some US$100 billion, has only gained steam after it was discovered that some employees quickly sold off their shares. Authorities have launched an investigation into the matter.
"We have suspended direct trading with Samsung Securities on concerns over decreasing stability in trading after a financial accident occurred," an official with the National Pension Service said.
The official declined to disclose the volume of the fund's stock trading done through Samsung. It had 136 trillion won (S$167 billion) of its assets invested in the local stock market as of January.
Samsung Securities, one of South Korea's biggest brokerages, issued the shares in error when it was supposed to pay dividends worth 2.8 billion won to employees under a stock ownership plan.
Its stock extended losses on Tuesday and has fallen 10 per cent since Thursday's close, wiping about US$330 million from its market value.