[Exclusive] "Looking Beyond Financial Statements for Future Value"... IBK Injects 170 Billion Won into 72 Innovative Companies

Launch of "Future Growth Potential Review Committee" in 2023

Evaluating Companies with High Growth Potential but Weak Performance

Limitations of Financial Statement and Collateral-Based Lending

Focus on Technological Capabilities, Growth, and Innovation

1 Trillion Won in Venture Capital to Be Provided This Year

IBK Industrial Bank of Korea has provided approximately 170 billion won in support to 72 companies with high growth potential but insufficient management performance over the past three years. This result was achieved through the "Future Growth Potential Review Committee," which was established to evaluate companies focusing on technological capabilities and growth potential, rather than relying solely on traditional financial statement-based lending reviews. The bank also plans to provide 1 trillion won in venture capital this year to accelerate the early identification of promising future companies.

1.697 Billion Won Supported Since 2023 System Launch... Average of 2.3 Billion Won Per Company

According to the financial industry on April 30, since the implementation of the system in February 2023 through March of this year, IBK Industrial Bank of Korea has provided a total of 169.7 billion won in support to 72 companies. The Future Growth Potential Review Committee was introduced to identify and support companies with strong growth potential that nevertheless face difficulties in securing funding due to weak performance. The average support per company amounts to approximately 2.3 billion won.

Traditional corporate credit reviews focus primarily on financial statements. Reviews are conducted based on quantitative indicators such as business performance, cash flow, and real estate collateral. However, there have been ongoing concerns that this approach has limitations in identifying companies with strong technology but insufficient collateral or weak financial results. The Future Growth Potential Review Committee was established to move beyond the existing evaluation system, which focuses on credit ratings and collateral, and to comprehensively assess companies based on technology, business viability, and growth potential.

The review process is operated with a high degree of precision. In the preliminary review stage, technological capabilities are verified, and in the main review, company representatives directly explain their business achievements and innovations at a "Company Presentation (FLC Day)." Notably, external experts from venture capital firms (VCs) and accelerators (ACs) also participate, enhancing objectivity in the evaluation. The review is conducted by a total of seven internal and external evaluators who comprehensively assess each company's growth potential. Internally, two credit review officers and two technology evaluation committee members participate, while externally, three experts from investment, legal, and consulting fields are included. The pool of external professional evaluators consists of about 70 individuals, ensuring objectivity and expertise. A senior official at IBK Industrial Bank of Korea emphasized, "There are areas that cannot be assessed with financial statements alone," adding, "IBK Industrial Bank of Korea is taking the lead—compared to other banks—in advancing qualitative assessments based on our long-standing experience in productive finance."

3.5 Trillion Won in Venture Capital by 2028... AI Review System Launched

In line with the government's focus on productive finance, support for early-stage startups will also be significantly expanded. IBK Industrial Bank of Korea plans to invest a total of 3.5 trillion won in venture capital from this year through 2028, with 1 trillion won expected to be injected into the venture investment market this year alone. Venture capital refers to funds invested in early-stage and innovative companies with high growth potential, in exchange for accepting high risk. Another senior official at IBK Industrial Bank of Korea explained, "Venture capital investments are not decided by financial statement figures," adding, "We focus on evaluating the management philosophy of the company's CEO—which cannot be quantified—as well as the company's unique technological capabilities."

To discover innovative companies, the bank has also completed the development of an in-house "New Technology Evaluation System" utilizing big data and artificial intelligence (AI). The core of this system is to assess growth potential using a wide range of non-financial data—including not only financial statements, but also technological capabilities, employment status, and research and development (R&D) investments. The New Technology Evaluation System is expected to significantly enhance the effectiveness of SME support, as it will be applied not only to technology finance reviews, but also to IBK venture loans and the selection of companies for the startup nurturing platform "Changgong."

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