Korea – Tracking Corporate Cash and Financial-market Flows

Korea has experienced substantial corporate cash generation alongside exceptional equity-market volatility, driving significant shifts in financial flows throughout 2026. First, Korean semiconductor companies are projected to generate roughly KRW150trn (or 4.9% of GDP) in net cash in 2026 and 9.3% of GDP in 2027. While these net cash-flow estimates do not automatically equate to inflows into Korea's domestic financial system, repatriation of foreign-affiliate earnings has historically averaged at around 60%. Thus far in 2026, robust corporate inflows into MMFs have directly supported demand for money-market instruments, while overall bank funding conditions have faced offsetting pressures due to a significant slowdown in household bank deposit growth. Second, large equity-market fluctuations have impacted other non-bank household financial flows. Increases in brokerage cash balances and equity-fund assets have coincided with higher insurance policy surrenders and elevated policy-loan d