South Korea's Financial Services Commission is requiringbanks to put aside more foreign exchange reserves to protect against possibleforeign capital outflows, Yonhap News Agencyreported July 25.

Local banks are required to raise their foreign exchangeliquidity coverage ratio to 80% in 2019 from 60% in 2017.

Foreign banks operating in South Korea and will notbe subject to the increased coverage ratio. Also excluded are local banks withforeign currency debt of less than US$500 million and foreign currency debtaccounting for less than 5% of their total debt.

KoreaDevelopment Bank will need to meet the required ratio of 60% in2019.