The government and the banking sector will provide ‘customized corporate financing’ worth a total of 76 trillion won to companies experiencing difficulties due to high interest rates.
More than 26 trillion won in funds will be provided to high-tech industries such as semiconductors and secondary batteries, and 15 trillion won will be intensively invested in mid-sized companies that have been neglected from policy support.
In particular, for the first time, a fund dedicated to mid-sized companies worth 5 trillion won will be launched for mid-sized companies that are having difficulty raising funds.
On the morning of the 15th, the Financial Services Commission held a meeting with bank presidents and heads of policy financial institutions, chaired by Financial Services Commission Chairman Kim Joo-hyun, at the Federation of Banks in Jung-gu, Seoul and announced a ‘customized corporate finance support plan’ with the following contents.
On the morning of the 15th, the Financial Services Commission held a meeting with bank presidents and heads of policy financial institutions presided over by Financial Services Commission Chairman Kim Joo-hyun at the Bank Hall in Jung-gu, Seoul and announced customized corporate finance support plans. (Photo = Financial Services Commission)
Financial Services Commission Chairman Kim Joo-hyun emphasized at the meeting that day, “In order for companies to continue to grow in a rapidly changing business environment, efforts are needed to secure competitiveness through new changes, and active financial support is needed in this process.”
He then emphasized, “It is important to support large-scale innovative investments in high-tech industries, concentrated investments in neglected mid-sized companies, and support for small and medium-sized businesses and companies in crisis that are experiencing difficulties such as high interest rates.”
The corporate finance support plan is worth 76 trillion won, of which commercial banks will support about 20 trillion won.
◆Support of 26 trillion won for high-tech industries and 15 trillion won for mid-sized companies… Launch of the first fund dedicated to mid-sized companies
First, we will provide strategic financial support worth 26 trillion won+@ to companies operating in the high-tech industry, which is the future food source of our country.
The ‘Supply Chain Stabilization Fund’, which is established to support companies that need funds to diversify import sources, develop alternative technologies, and secure overseas resources, will be operated without disruption.
Korea Development Bank provides low-interest funds worth 15 trillion won to five major fields, including semiconductors, secondary batteries, and bio, with interest rates reduced by up to 1.2%p.
In response to the large-scale demand for funds in high-tech strategic industries, companies and pension funds will participate as shareholders, and it will also be reviewed to provide financial support loaned by policy financial institutions and private financial institutions through project financing (PF).
A support plan worth 15 trillion won has also been prepared for mid-sized companies that have been neglected from policy support.
There are about 5,600 mid-sized companies (accounting for 1.5% of companies), which is small in total number, but they account for a significant proportion of total sales (16.1%) and employment (12.9%).
Accordingly, it was decided to launch the first mid-sized company-specific fund for mid-sized companies that need funds to advance into new businesses and expand their businesses.
For the first time, banks will raise 5 trillion won through investments of up to 2.5 trillion won. The five major commercial banks and Growth Finance (a fund management company) have committed to the maximum investment amount through an MOU and plan to create a fund exclusively for mid-sized companies with a total of 500 billion won each by the third and fourth quarters of this year.
In addition, the five major banks and the Korea Development Bank have established an exclusive low-interest loan program worth 6 trillion won for mid-sized companies entering new businesses to help them advance into new growth businesses.
In addition, it will support the issuance of new corporate bonds worth 1.8 trillion won, and establish a growth ladder program worth 2.3 trillion won through cooperation between banks and guarantee institutions.
◆Support for normalization and recovery of companies struggling with high interest rates… Provides interest rate reduction program
We provide rapid normalization and recovery support programs to companies and entrepreneurs who are experiencing management difficulties or crises due to high interest rates.
Five banks and Industrial Bank of Korea are jointly providing a special interest rate reduction program worth 5 trillion won to small and medium-sized businesses experiencing a decline in sales.
In addition, Industrial Bank of Korea provides a deferral program to companies that are having difficulty repaying interest by postponing the additional interest rate for a certain period of time and allowing them to pay in the future when business conditions improve. In particular, by expanding the support target of the joint rapid support program for the banking sector, the additional interest rate for one year will be exempted for companies expected to face temporary liquidity risks this year, and the interest rate in the 3% range (current standard) will be applied.
We strengthen the dynamism of the entire industry by supporting the recovery of entrepreneurs who have already experienced business closure. We provide new funds more quickly to entrepreneurs who have faithfully followed the credit recovery process so that those who have experienced failure can quickly recover, focusing on areas with business potential.
For entrepreneurs whose past failures are considered inevitable, banks and Shinbo plan to provide more active support for re-startup funds.
Chairman Kim Joo-hyun said, “This plan is the result of cooperation between the public and private sectors,” and added, “We will continue efforts to improve systems and expand infrastructure so that private banks can handle corporate finance more actively in the future.”
Inquiries: Financial Services Commission Industrial Finance Division (02-2100-2864)
2024-02-15 09:08:00
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