|
The Financial Services Commission on Thursday announced measures to help cash-strapped exporters.
The Korea Credit Guarantee Fund and the Korea Technology Credit Guarantee Fund will expand guarantees on trade financing from 95 percent to 100 percent, and raise the guarantee ceiling from W3 billion to W10 billion (US$1=W1,478). The measures aim to induce banks to extend more loans to small- and mid-sized exporters.
Trade financing refers to purchasing export bills of exchange, lending export bills as collateral, and payment guarantees through issuing import letters of credit.
Also, to protect small businesses that have borrowed money using real estate as collateral, from banks demanding loan repayments amid falling property prices, the KCGF will give a temporary, full guarantee of their collateralized loans until December next year. Small businesses refer to firms with fewer than five full-time workers (fewer than ten in manufacturing, construction, transportation and mining).
A FSC official said, ¡°If the KCGF and the KTCGF increase their guarantees, they can help banks relieve their burdens on their Bank for International Settlements capital adequacy ratios. Banks can thus extend new loans or the maturity of loans to SMEs.¡±
The FSC also said that banks¡¯ loans to SMEs had taken an upward turn to reach W3.4 trillion in October and W4.3 trillion in November. Some W2 trillion had been loaned from August to September.
(englishnews@chosun.com )
|
