However, only Korea Investment & Securities was given approval to do short-term corporate lending, such as the issuance of commercial papers that is viewed as one of the key businesses for an investment bank.

The FSC said it is still reviewing the financial health and eligibility of major shareholders of the remaining four brokerages to determine if they are eligible for the short-term financing business.

It remains unclear whether the FSC will complete the review by the end of this year.

Choi Jong-ku, chairman of the FSC, said in the statement that granting investment banking licenses to brokerages would spur "competition and innovation" with banks.

"To help secure new growth engines for our economy, various channels will be set up for a smooth supply of funds needed for companies," Choi said.

Last year, the financial regulator announced a plan that investment banks with 4 trillion won ($3.6 billion) or more in equity capital will be eligible for short-term corporate lending. The goal was to lay the foundation for transforming local financial institutions into investment banks with worldwide reach.

Brokerages with equity capital of 8 trillion won or more will also be able to launch investment management accounts.

At the end of June this year, the equity capital of Mirae Asset Daewoo Securities stood at 7.1 trillion won, followed by NH Investment & Securities at 4.6 trillion won.

Korea Investment & Securities came third with 4.3 trillion won, followed by KB Securities and Samsung Securities with 4.2 trillion won each. (Yonhap)