Bank on a Roll

Korea Exim Bank provides 28 trillion won to support exports

The Export-Import Bank of Korea plans to expand its financial support to the export business community for early realization of Korea to become an advanced trading nation. The bank will increase its support to expand exports, especially to small exporters, and securing overseas natural resources this year.
Under the 2006 business plan, the bank will extend credit totaling 28 trillion won including 16 trillion won in loans and 12 trillion won in guarantees, up 17 percent from last year and more than two-fold increase compared to those in 2001.
The 16 trillion won set aside for loans will include 12.5 trillion won in loans, 1.6 trillion won in support to invest abroad, natural resources exploration and 1.9 trillion won to support imports. The 12 trillion won in guarantees will go to support a number of large overseas projects in such areas as shipbuilding, plant exports, and overseas construction projects.
The bank plans to render a greater support to the export related industries including overseas construction projects and plant exports to help the nation's exports to reach over $310 billion this year despite high oil prices and a strong Korean currency, buffeted by the recovery of the global IT business and increases in orders for plants from the oil producing countries in the Middle East. Exim bank plans to focus its support on SOC and plant export projects in particular with oil producing countries and BRICs hiking their orders for those projects. The bank plans to offer financial support tailored to the needs of various ship specifications to increase the orders for high value-added projects.
The bank also allocated its support to the service industry exports including high-tech and cultural content products, putting into use advanced financial methods such as factoring. The bank has set aside 1.6 trillion won to be provided to a number of key areas including the support to build a global management system by Korean companies making efforts to expand their operations abroad and projects to secure natural resources overseas. The allocated amount is up 18.6 percent from last year. Some 250 billion won, double the amount in 2005, has been allocated to support the exploration of oil and gas overseas by Korean companies. The bank will focus its support on securing key material, imports of high-tech facilities by extending some 1.9 trillion won, up 14.4 percent from last year, along with imports of airplanes needed to make Korea a hub logistics country in Northeast Asia.
Exim bank has set aside some 4.5 trillion won to support SMEs, up 9 percent from last year, to mitigate problems arising from high oil prices and the strong won currency. Loans to be extended to them will be increased by 26 percent this year. The bank will also provide some 1 trillion won in loans to SMEs located in provincial areas across the country.
The bank's history traces back to 1976 when it launched its operation as an official export credit agency providing comprehensive export credit and project finance to support Korean enterprises in conducting business internationally. Since its establishment, the bank has worked to facilitate the development of the national economy and enhance economic cooperation with foreign countries as a financial catalyst.
The bank has worked in the area of vitalizing Korean exports as an export credit agency. It has actively financed construction of capital goods such as ships, and plant as well as high-tech industries including IT. It has supported overseas investment and major resources development projects. The bank has been engaged in strengthening economic cooperation with developing countries through EDCF.
The bank has been handling the inter-Korean Cooperative Fund to promote reconciliation and cooperation with North Korea. The bank has been in charge of examination and appraisal of projects, disbursement procedure, and supervision and ex-post evaluation. The bank has been designated as the official inter-Korean Settlement Bank for South Korea with Foreign Trade Bank of North Korea as its counterpart.
As of the end of June, the bank's capital totaled 3.285,8 trillion won and liabilities amounted to l8.984.8 trillion won including bonds totaling 8.146,1 trillion won. S & P gave A- credit rating and Moody's A3. The bank has 11 domestic branches and 12 liaison offices around the world including New York, Washington, Tokyo, Moscow, Beijing and Paris, along with four wholly-owned subsidiaries overseas. nw

President of the Export-Import Bank of Korea Shin Dong-kyu