Saneun and Su-eun Provide 1.2 Trillion Won Emergency Support to Korean Air

On the 2nd, aircraft are parked at the apron of Incheon International Airport. Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Kim Hyo-jin] The Korea Development Bank and the Export-Import Bank of Korea will provide emergency support of 1.2 trillion won to Korean Air.

On the 24th, the two state-run banks announced that they had decided to provide this scale of financial support to Korean Air, which is facing a downturn in the global aviation industry and liquidity issues due to the COVID-19 pandemic.

This measure is a prompt support action taken before the establishment of the more than 40 trillion won Industrial Stabilization Fund, which the government confirmed at the '5th Emergency Economic Meeting' on the 22nd.

However, the Development Bank and others set as conditions for support the airline's own efforts for capital expansion and management improvement, employment stability efforts, restrictions on high salaries, dividends, and stock repurchases to prevent moral hazard, and sharing of future corporate normalization profits.

Korean Air is experiencing severe management difficulties as most international routes, which account for 94% of passenger revenue, have been suspended due to the impact of COVID-19.

Earlier, on the 21st, these banks decided to support Asiana Airlines with a credit line loan of 1.7 trillion won.

The Development Bank stated, "Regarding the acquisition of Asiana Airlines, we expect the acquirer, HDC Hyundai Development Company, to complete the corporate merger approval procedures and successfully conclude the acquisition."

This content was produced with the assistance of AI translation services.