While delivering his commemorative speech at a ceremony to celebrate the 46th anniversary at KODIT headquarters on May 31, Chairman-CEO Yoon Dae-hee of Korea Credit Guarantee Fund stressed the importance of refined risk management.
He made the remarks at the ceremony in which about 222 KODIT regional headquarters chiefs, executives and staff members took part.
“Based on our potential energy with which we have wisely gone through a myriad of changes and crises for the past 46 years, we’ll not stop innovation and challenges to go forward for a better future,” Chairman Yoon said,
Chairman Yoon said, “KODIT will have to fulfill missions of the times — carrying out roles of policy financing designed to brace for the post-COVID-19 pandemic and support SME’s dynamic resurgence at the current situation riddled with external uncertainties surrounding the national economy and greater economic uncertainties.”
He cited support tailored to meet the needs of small businesses struggling with poor economic response issues and prioritizing their capabilities on exporting, job creation and the raw materials, parts and equipment sectors.
KODIT plans to nurture advanced industries, such as semiconductors, AI and batteries, directly linked with national competitiveness, as well as strategic core industries, such as future cars and bio industry, he said.
KODIT will explore the growth potential of technology-based startups earlier, strengthen regimes to support innovative growth of startups to spur their growth into global unicorn companies, spearhead carbon neutrality, ESG management and promotion of shared growth between large- and small-sized companies and innovation of digital financing, Chairman Yoon said.
KODIT was established on June 1, 1976, as a policy financing institution to support SMEs, which were left behind with insufficient government support during the 1970s as the nation achieved rapid economic growth with a focus on conglomerates.
KODIT has been credited with having played leading roles in the growth of the national economy and serving a role as a “relief pitcher” by minimizing economic impacts and the swift recovery whenever the nation was faced with crises, including the 2019 Asian financial crisis, the global financial crisis and the economic crisis, caused by the spread of the pandemic.
KODIT Supplies 1 Trillion Won to SMEs Struggling with Pandemic-related Issues
Korea Credit Guarantee Fund (KODIT) issued primary collateralized bond obligations (P-CBOs) worth 1 trillion won to finance SME victims of the COVID-19 pandemic in May, the institution said on May 27.
The issue of the P-CBOs was the biggest in the first half of this year, and was designed to offer money to a combined 362 companies - four large-sized, 36 mid-sized companies and 322 SMEs.
Out of the total 1 trillion won, 760 billion won is offered as new funds, and the remaining 240 billion won is financed for repaying debts of the debtor companies.
P-CBOs, issued by KODIT, is a type of structured debt security that individual companies can raise money on the financial market by issuing asset backed securities based on the collateral of basic assets such as its corporate bonds.
As for SME beneficiary candidates, they are required to be classified into K9 or higher based on KODIT’s in-house classification and SMEs with CPA audit reports need to be K10 or higher. As for mid-sized and large-sized companies, their corporate bond credit rating need to be BB- or higher.
Meanwhile, part of the new funds issued by P-CBOs is to be raised abroad.
The overseas issuance of the P-CBOs is the first one since KODIT was established. The overseas issuance of the P-CBOs is $300 million ESG bonds with a three-year maturity.
KODIT has managed to offer a stable supply of money to companies by diversifying investors to the global bond market, a step to cope with a possible decline in investment demand in the domestic market.
A KODIT official said, “KODIT has managed to offer necessary funds timely through the biggest-ever issuance of P-CBOs to companies struggling with difficulties, caused by the pandemic and Russia-Ukraine war, in the first half of the year.”
KODIT plans to continue to implement aggressive and innovative policies so companies’ money demands can be fully met in the years to come, the official said.
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