Assemblyman Yongbin Lee: "National R&D Budget Only Fattened Banks"

Selected Bank for Managing 6.4 Trillion Won Research Funds; Deposit Interest Rate Only 0.2% Over 5 Years

[Asia Economy Honam Reporting Headquarters Reporter Yoon Jamin] The Ministry of Science and Technology and the National Research Foundation have been criticized for fattening the profits of some banks with taxpayers' money by reducing interest rates for banks holding trillions of won in national funds and even waiving costs that the banks should bear.

According to the national audit data submitted by Rep. Lee Yong-bin (Democratic Party of Korea, Gwangju Gwangsan Gap) from the Ministry of Science and Technology on the 18th, the Ministry and the National Research Foundation established the integrated research fund management system called ‘Tonghap Ezbaro’ (Ezbaro), which unified the research fund management systems that had been separately operated by 13 ministries since last September. Accordingly, Shinhan Bank and Woori Bank were selected as the dedicated banks to deposit the 64 trillion won in national R&D project funds.

Shinhan Bank and Woori Bank, selected as the dedicated banks, manage the 64 trillion won in research funds from 13 ministries by depositing them in a 6:4 ratio, and according to the original recruitment announcement for the dedicated banks, they were supposed to share 15.6 billion won proportionally for the construction and operation of the Tonghap Ezbaro infrastructure.

The problem is that the 15.6 billion won infrastructure construction and operation costs, which were originally supposed to be borne by the banks, were covered by the interest that should have been paid to the national treasury, and the Ministry of Science and Technology and the Research Foundation tacitly allowed this.

Moreover, the interest rate on the deposited research funds was set lower than the market rate, giving excessive benefits to the banks.

Out of the 64 trillion won in national R&D funds, even excluding the 54 trillion won paid in bulk to research institutions with short deposit periods, the interest received from depositing about 1 trillion won (960 billion won) of national funds was only 1.9 billion won. The interest rate was decided to be a mere 0.2%.

The reason why such an absurdly low interest rate of 0.2% was calculated is that the Ministry of Science and Technology’s interest rate calculation committee decided to subtract 0.65% from the market interest rate.

According to Bank of Korea statistics, as of April last year when the interest rate was decided, the weighted average interest rate for corporate MMDA was 1.1%.

Subtracting 0.65% leaves 0.45%, which is less than half, and from October of the same year, the interest rate was effectively set at the minimum limit of 0.2%.

The Ministry of Science and Technology and the Research Foundation claim that they reduced 0.65% to waive the infrastructure construction costs (5.3 billion won) and operation costs (system maintenance and call center operation costs) totaling 15.6 billion won that the banks were supposed to bear, but there is no basis for this reduction.

They effectively returned the interest that should have gone to the national treasury back to the banks at their discretion.

Not only that, the Ministry and the Research Foundation even discounted the infrastructure construction costs that banks were supposed to bear in advance from 5.3 billion won to 4.7 billion won, contrary to the original announcement, instead of depositing the R&D funds.

On the other hand, the 7 billion won in national funds required for system development was fully invested.

The integrated Ezbaro is an upgraded version in function and scale of the existing Ezbaro system, but Rep. Lee expressed doubts about whether such a huge budget of 21.6 billion won should have been invested.

Rep. Lee said, “While depositing huge national funds, the interest rate was set unreasonably low, and the project costs that banks should have borne were discounted, effectively fattening the banks’ profits. A comprehensive review is needed on the basis for deciding to reduce the interest rate from the selection process of the dedicated banks, and on the parts operated differently from the original announcement.”

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