Shin Yong Bo Jeung Gi Geum, 520 Billion KRW Supply of P-CBO in July

4 Major Corporations, 2 Specialized Credit Finance Companies, and a Total of 32 Affected Companies Receive Liquidity Support
Plan to Provide 5.5 Trillion Won in Funding in the Second Half of the Year

[Asia Economy Reporter Ki Ha-young] The Korea Credit Guarantee Fund announced on the 24th that it provided new funds amounting to 520 billion KRW in July to companies affected by the novel coronavirus infection (COVID-19) through securitization company guarantees.

In the July issuance, new funds were provided with a 3-year fixed maturity to 4 large corporations and 26 medium-sized enterprises, and liquidity was also supplied to 2 specialized credit companies that participated in principal and interest repayment deferrals for small business owners and others.

The Credit Guarantee Fund’s securitization company guarantee is a system that supports companies in raising long-term funds directly from the financial market by issuing securitized securities based on corporate bonds issued by individual companies as underlying assets.

In response to temporary market liquidity tightening caused by the spread of COVID-19, the government introduced the 'COVID-19 Damage Response P-CBO' in April. Through this, the Credit Guarantee Fund plans to support new funds of 5.5 trillion KRW in the second half of the year, following 1.2 trillion KRW in the first half.

The COVID-19 Damage Response P-CBO targets large corporations and medium-sized enterprises, supporting up to 100 billion KRW for large corporations and up to 70 billion KRW for medium-sized enterprises. The procurement cost for large corporations is applied by adding a certain margin to the individual average market interest rate, and for medium-sized enterprises, it can be applied at the mid-2% range based on a BBB credit rating.

A Credit Guarantee Fund official stated, "Due to the prolonged crisis caused by COVID-19, we are striving to eliminate blind spots in funding support by providing new funds even in July and August, when there were no previous securitized securities issuances," and added, "We will continue to play a solid supporting role to prevent our economy from falling into recession through regular monthly securitized securities issuances in the second half of the year."

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