Chairman and CEO Kim Yong-hwan of the Export-Import Bank of Korea (Exim Bank) won the CEO Award of the 23rd Dasan Financial Awards in the area of public finance for his contribution to the introduction of a financial solution allowing state-owned banks and private financial companies to secure overseas projects since his inauguration to head the bank as chairman and CEO in 2011.
With the financial solution, the Korea Exim Bank has been able invite other banks to participate in joint financing for large overseas projects in tailor-made packaged financial services in addition to its traditional financial services including loans and the issuance of guarantees.
A good example of the new financial deals is the provision of $120 million in joint loans to LG CNS to cover the transportation system construction project in Bogota, Columbia, in September 2012 with the participation of both Shinhan Bank and Woori Bank. The significance of the loan package was that it was the first case of project financing involving a state-owned bank and private commercial banks in Korea.
The Exim Bank also first extended its guarantee for the bonds issued by a shipping firm for the first time in the world. The guarantee facility involves the Exim Bank issuing guarantees for the bonds issued by a foreign vessel owner to pay for its ships ordered to Korean shipbuilding companies.
Chairman Kim said the guarantee facility is to help foreign ship owners secure enough funds to build their new ships at Korean shipyards because European banks have rejected their loan requests.
Exim Bank announced on Nov. 14 that it signed an MOU for the establishment of a Korean-Russian Co-investment Platform, aimed especially at promoting the development of the Russian Far East, with Russia’s state-owned Bank for Development and Foreign Economic Affairs (VEB), at the presidential Blue House in the presence of the heads of state of the two countries.
The Korean-Russian Co-investment Platform is an arrangement for cooperation between Exim Bank and VEB structured to financially support Korean companies investing or participating in projects identified jointly by the two institutions.
The MOU includes an agreement to work toward jointly identifying large-scale development projects in sectors including energy, petrochemical plants, natural resources, transportation, shipbuilding, environment, and alternative energy in Russia, especially in the Far East and Eastern Siberia.
The two agencies would provide equity investments and financing for projects involving companies from both countries with a combined amount of up to $1 billion.
By establishing a substantive framework of cooperation between the two principal financial policy arms of the Korean and Russian governments, the MOU is expected to boost opportunities for Korean companies to participate in Russia’s $359 billion long-term plan to develop the Far East.
Although rich in natural resources such as oil, gas, coal, and timber, Eastern Siberia remains underdeveloped due to its poor infrastructure base — an area which is likely to draw in continued investments.
In order to attract the necessary foreign investment, Russia joined the WTO last year and created a ministry devoted to the development of the Far East.
Korea Exim Bank Chairman Kim Yong-hwan met with HBTF Chairman Dr. Mihel Marto at the HBTF’s headquarters in Amman, Jordan, on Dec. 4 and signed an Interbank Export Loan Agreement to extend a $50 million credit line to HBTF so as to provide financing for local companies in the Levant region (including Jordan) importing goods from Korea.
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