South Korea's Financial Supervisory Service (FSS) has announced a comprehensive monitoring regime for $37 billion in overseas private debt investments. This move comes amid concerns over the rapid growth of offshore private debt exposure, which the FSS views as a potential risk to the Korean financial system. The initiative follows liquidity issues at funds linked to Blue Owl Capital, prompting the FSS to impose stricter disclosure requirements and conduct inspections. Korean institutions, driven by low domestic interest rates, have increasingly invested in global private credit funds managed by firms like Blackstone and BlackRock. The FSS's new measures aim to ensure transparency and protect investors, particularly retail investors, from potential risks associated with these investments. The increased compliance demands may lead to higher costs for firms and could slow capital flows from Korea into global private credit as institutions adjust to the new regulatory landscape.