Stock buybacks have helped little to serve their primary purpose of boosting shares in Korea as companies handed out the treasury shares to employees instead of cancelling them to reduce outstanding shares.

According to the Financial Supervisory Service (FSS), of 156 buyback schemes by Kospi and Kosdaq members announced this year, only 22 had been retired that help to reduce outstanding shares and boost stock prices.

Shares of Meritz Securities Co. soared more than 10 percent in one month after it announced its plan to cancel its treasury shares. Meritz Securities canceled around 99.7 billion won ($78.47 million) worth of its own shares on March 24. Hana Financial Group plans to cancel 150 billion won worth treasury shares on Friday while Shinhan Financial Group already retired 150 billion won worth shares.

Stock retire after buyback is common practice for indirect shareholder reward.

Apple Inc. repurchased $85.5 billion of its own shares and cancelled them last year.

The move has helped limited stimuli impact in Korea as most buyback shares return to the market to indulge the companies or employees rather than the shareholders.

Kakao Corp. and Naver Corp. have recently decided to sell treasury shares each worth 10.4 billion won and 158.2 billion won across three occasions this year to finance incentives for employees.

Amorepacific Corp. also disclosed that it would dispose of treasury shares worth 7.8 billion won for the same reason.

Grain companies, which have seen a spike in their share prices on global commodity price hikes, are selling treasury shares to make profit. Sajo Donga One Co. last week announced to sell 5 million of its shares worth about 9.35 billion won during after-hours trading to improve its financial structure. Milae Bioresources Co. decided to sell 3,000 shares and 11,500 shares worth around 52.21 million won in total across two occasions.

By Kim Geum-yi and Susan Lee

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