On Aug. 12, KAMCO President Moon Sung-yu (center) conducts a special safety inspection of workplaces in summer with officials from a construction contractor and construction project managers at a construction site in Uijeongbu. (Photo: KAMCO)

Korea Asset Management Corporation (KAMCO) announced on Aug. 20 that it will prepare and implement a system to help companies having a difficulty in repaying debts and implementing rehabilitation plans due to the prolonged COVID-19 crisis.

Following the revision of the Act on the Establishment of Korea Asset Management Corporation on July 23, KAMCO will focus on strengthening its role in providing actual corporate rehabilitation support by easing financial and procedural burdens on rehabilitating companies hit by the COVID-19 situation.

Through this improvement plan, KAMCO will provide a foundation for the early normalization of the rehabilitation of companies with high survival value by extending debt adjustment arrangement periods and easing standards on agreeing to a revival plan.

Specifically, KAMCO will ease financial burdens on the rehabilitation of companies suffering from reduced sales due to the novel coronavirus by allowing a cut in interest rates, considering their financial position and rehabilitation plans.

In addition, the debt repayment period (up to 10 years) applied uniformly under the rehabilitation plan can be extended by up to five years for companies which passed 50 percent of their repayment period.

In addition, KAMCO will ease criteria on companies with total liability in the previous year 1.5 times their total assets or more than them so they will agree to a workout plan.

At the same time, it will decrease interest burdens in their rehabilitation plans considering their financial conditions.

In addition, KAMCO plans to increase the possibility of recovery through normalization by specifying that it can support various corporate support programs such as DIP Finance that provides new business operation money to rehabilitating companies highly likely to normalize their businesses and a sale and leaseback (S&LB) program.

“We hope that this improvement in our system will contribute to the rapid normalization of workout companies suffering from the prolonged novel coronavirus crisis,” said Kim Gwi-soo, head of Corporate Support Department at KAMCO.

On the other hand, KAMCO has about 100 companies’ rehabilitation bonds under management, provides 51.5 billion won worth of business operation money via DIP financial support, and actively supports companies by supplying 668.6 billion won worth of liquidity through S&LB programs.

From August 16 to 27, KAMCO held an online capacity building workshop for 24 officials from the Department of Land and Statistics of the Ministry of Finance, Jordan.

The program aimed to enhance the efficiency of management and the value of state properties by sharing Korea’s best practices regarding management, disposal and development of state properties.

The program was part of Korea International Cooperation Agency (KOICA) Online Fellowship Program, CIAT which is a cooperation program where policy-makers, public servants and experts from developing countries are invited for technical training and knowledge sharing.

At the workshop KAMCO covered various topics from the management, disposal and development of state properties to state property management IT systems. For a more comprehensive understanding of the Korean experience, an outside expert from LX (Korea Land and Geospatial Informatix Corporation) was invited to deliver a lecture on the cadastral survey of state properties.

Earlier, from July 6 to 14, KAMCO jointly held an online training workshop with Korea Institute of Public Finance (KIPF) for delegates of State Asset Management Agency, Uzbekistan. The workshop was sponsored by EBRD, to share advanced methods and practical examples from Korean experiences.

The online training covered various subjects ranging from the privatization of SOEs to the management and performance evaluation of SOEs, as well as the management and development of state-owned properties, methods of divesting state-owned assets and the online asset disposition system (OnBid).

The workshop was the first case of the cooperation between the 3 parties after signing an MOU in February of the same year, through which the parties could identify more cooperation opportunities for the future.