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The state-run Korea Finance Corp. (KoFC) will provide a total of 12.2 trillion
won (US$11.5 billion) for local companies to prop up their growth amid the
protracted global economic downturn, its chief said Monday.
The
amount, which will be extended in loans and investment, is down 8.2 percent from
the 13.3 trillion won the KoFC provided firms with the previous year. The
corporation said it has reduced its portion for investment this year, citing
jittery economic conditions here and abroad.
Chin Young-wook, the
president of the KoFC said it plans to allocate 62 percent of the annual target
for small and medium sized enterprises (SMEs)
"(The percentage) is
considerably higher than the average of around 50 percent we set aside for
smaller companies for the last couple of years," he told reporters. "The portion
could easily surpass the envisioned 62 percent, as the KoFC will opt to focus on
SME lending."
The KoFC's plan comes as President-elect Park Geun-hye, due to
take office next month, has vowed to put her policy focus on helping SMEs grow
and weather the bleak economic conditions forecast for this year.
Last
week, major state-run policy lenders unveiled a similar plan to provide smaller
firms with more loans this year, to be in step with Park's pledge.
A
spate of such moves came after the presidential transition team announced a
shakeup of the government ministries and agencies, which includes the expanded
role of the administrative body in charge of supporting SMEs.
The
KoFC, set up by the current Lee Myung-bak administration in 2009, mostly caters
to supporting SMEs or bigger companies with growth potential that are more than
three years old.
On the back of the consecutive sovereign rating
upgrades on Korea by major global credit appraisers last year, the KoFC has been
able to secure and provide funds to companies with cheaper costs, Chin
added.
On the sidelines of the lending plan, the state-run financing
firm said it plans to raise a total of 21.9 trillion won through selling bonds
this year in a bid to secure ample liquidity, it said.
As of the end
of 2012, the aggregate amount of corporate financing by the KoFC stood at 33.7
trillion won, with 6 trillion won raised via bond sales, according to KoFC
data.