'Tailored Support for Petrochemical Business Restructuring'... KDB Offers Low-Interest Loans to Companies Consolidating Facilities

Kwon Daeyoung, Vice Chairman of the Financial Services Commission, is delivering opening remarks at the 'Petrochemical Industry Restructuring Finance Sector Meeting' held at the Korea Federation of Banks in Jung-gu, Seoul on August 21, 2025. Photo by Yoon Dongjoo

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Korea Development Bank (KDB) will provide support, such as low-interest loans, to petrochemical companies that voluntarily pursue facility consolidation or mergers and acquisitions (M&A). KDB is reportedly preparing a variety of support programs internally, totaling approximately 2 trillion won.

According to the financial industry and financial authorities on August 25, KDB has allocated a budget for the "Business Structure Transformation Support Fund" program for petrochemical companies that voluntarily carry out facility consolidation.

The "Business Structure Transformation Support Fund" is a program designed for companies pursuing business restructuring. It aims to resolve excess supply and promote entry into new business sectors. The program provides low-interest loans for acquiring business assets for restructuring purposes or for driving business innovation.

There is no loan limit per company. Support is available not only in Korean won, but also in US dollars, Japanese yen, and euros. However, only companies with a credit risk rating of B or higher (normal companies) are eligible for this program.

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The preferential interest rate is set between 0.30 percentage points (foreign currency) and 0.60 percentage points (Korean won), but for companies that have completed business restructuring approval under the Special Act on Corporate Vitalization, the preferential rate rises to between 0.60 percentage points (foreign currency) and 1.20 percentage points (Korean won).

An industry official explained, "If a petrochemical company wants to consolidate existing facilities and make new investments to enter new businesses such as specialty chemicals, it can receive support. The loans are provided at rates lower than market funding costs, reflecting each company's credit rating."

Petrochemical companies that voluntarily pursue M&A can also receive financial support. KDB considers acquisition financing required during the M&A process as facility funding. In addition, support is available for mergers, stock acquisitions, and business transfers.

There are prerequisites for receiving financial support. First, petrochemical companies must prepare their own business restructuring plans. The government will comprehensively review the feasibility of restructuring and its impact on the petrochemical industry to provide customized financial support. The Fair Trade Commission also intends to promptly review and approve the business restructuring plans submitted by companies.

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