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Korea lifers set to increase hedging as accounting shake-up looms
Bond forwards likely to be favoured instrument, but interest rate swaps market could develop
![Traditional-Korean-sundial Traditional-Korean-sundial](/sites/default/files/styles/landscape_750_463/public/2021-02/Traditional-Korean-sundial.jpg.webp?h=788470db&itok=nTc9HRcm)
Dealers predict an increase in interest rate hedging by South Korean life insurers over the next couple of years as two key deadlines approach: the introduction of accounting standard IFRS 17 and the rollout of a new solvency capital framework. Both of these changes are due to take place at the start of 2023.
The revamp of accounting rules aims to address a mismatch in the way that Korean insurers calculate assets and liabilities. Currently, companies apply a larger discount to the value of
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