Daejeon City Promotes Establishment of Public Complex Financial Institution '(Tentative Name) Daejeon Investment Agency'

[Asia Economy (Daejeon) Reporter Jeong Il-woong] Daejeon City is promoting the establishment of the '(tentative name) Daejeon Investment Agency,' a public-type complex financial institution.

On the 10th, Mayor Lee Jang-woo visited the Daejeon City Hall press room and revealed plans regarding the establishment of the Daejeon Investment Agency.

The Daejeon Investment Agency will be established in the form of a New Technology Finance Company (a stock company under the Commercial Act) under the Specialized Credit Finance Business Act.

A New Technology Finance Company is a financial company that invests in or lends to small and medium-sized enterprises commercializing new technologies, and can be established with a capital of over 20 billion KRW and registration with the Financial Services Commission.

To establish the Daejeon Investment Agency, the city plans to make an initial investment of 50 billion KRW in public funds and use this as a medium to additionally raise private funds from citizens, regional mid-sized companies, economic organizations, and financial institutions, aiming to secure a final capital of 70 billion KRW by the time the Daejeon Investment Agency opens next year.

The city plans to prepare the investment funds by utilizing existing fund recoveries and part of the SME development fund without inputting the general accounting budget, and also plans to expand the investment fund scale up to 100 billion KRW until the establishment of a 'corporate finance-centered bank' based on the Daejeon Investment Agency.

Once established, the Daejeon Investment Agency will engage in activities encompassing funds for corporate investment and low-interest loans. In particular, it is expected to play a bridging role in the future process of establishing a corporate finance-centered bank.

First, the Daejeon Investment Agency will serve as a new source of funds for regional SMEs, handling venture capital investments and low-interest loan functions that are neglected by commercial banks and private investment firms.

Based on this, the city plans to form a public fund exceeding 500 billion KRW annually before establishing the corporate finance-centered bank, investing at least 60% of the fund in companies in key regional industries such as nano semiconductors, bio, space, and defense.

Additionally, to support companies with excellent technological capabilities but low collateral ability, the agency will operate low-interest loans amounting to 40 billion KRW. These loans will be provided at interest rates around 3%, similar to government public fund loan rates.

The city plans to prepare detailed plans for the establishment of the Daejeon Investment Agency within this month, complete registration and establishment with the Financial Services Commission in the first half of next year, and later merge and operate the corporation at the time of establishing the corporate finance-centered bank.

Mayor Lee said, “To realize 'Daejeon as a first-class economic city,' the city plans to focus on nurturing industries such as nano semiconductors, bio, space, and defense through two major pillars: supplying large-scale industrial sites over 5 million pyeong and establishing a corporate finance-centered bank.” He added, “The Daejeon Investment Agency serves as a kind of stepping stone to create the corporate finance-centered bank. The city will strive to ensure the establishment of the Daejeon Investment Agency is realized promptly.”

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