South Korea's central bank said on Thursday it is widening participation in its open market operations to include asset management firms, mutual savings banks and credit unions, to enhance monetary policy effectiveness.

Effective from Feb. 1, the new participants will be eligible to engage in repurchase agreement (RP) transactions for securities and in monetary stabilisation bond auctions, the Bank of Korea said in a statement. Participation is currently limited to banks, securities firms and insurance companies.

The change reflects asset management firms' rising influence in short-term money markets and aims to enhance the market stabilising function of the monetary policy tool, the central bank said. (Reporting by Jihoon Lee; Editing by Edmund Klamann)