The Korea Exchange, the nation’s main stock operator, will provide incentives for local firms to bolster their dividend payouts from as early as the second half of this year, its chairman said Friday.

“We will be coming up with a number of different incentives to induce companies to pay out more dividends to their investors,” Korea Exchange chairman Choi Kyung-soo said in a meeting with reporters.

Choi pointed out that the country’s dividend payout and yield ratios are “considerably low” relative to those in other developed countries.

South Korea’s dividend payout ratio ― the percentage of total dividends divided by net income ― stands at 22.4 percent, far below the global average of 47.7 percent, according to the latest data from the Korea Exchange.

Many local conglomerates, including index heavyweights Samsung Electronics, have remained reluctant so far to boost dividends, despite mounting pressure from investors.

Samsung’s dividend payout ratio was just 12 percent last year, falling far below the average 21 percent of the 440 listed companies here, the KRX data found.

The KRX chief also hinted that he would seek to introduce a new index to evaluate dividend rates of listed firms. 

“We will develop new indices, such as those covering high-dividend stocks or preferred shares, to widen the base for dividend-related investment,” he said without further elaboration.

His remarks come as the new Finance Minister Choi Kyung-hwan is seeking various measures to boost economic growth, including transferring corporate capital to consumers.

The finance chief said recently that it would be difficult to cut high household debt and revive slumping domestic consumption without increasing disposable household income.

The minister, in particular, had criticized local conglomerates for hoarding cash instead of investing in the overall economy, speculating rumors that he would move to levy a tax on companies’ excessive cash reserves.

Facing strong resistance from businesses, however, the new finance minister seemed to be reluctant to tax business firms, but rather willing to offer them incentives to increase investment and dividends.

Choi is expected to announce a set of new proposals to boost the country’s economy this week.

By Oh Kyu-wook (596story@heraldcorp.com)