S. Korea to guarantee US$14 bln in bank foreign debts

SEOUL, Nov. 14 (Yonhap) -- South Korea's financial watchdog said Friday the
government will guarantee the payment of US$14 billion in local banks' foreign
debts in an effort to ease their dollar squeeze.

The amount covers foreign loans that South Korean banks borrowed in late October
or plan to bring in until June next year, the Financial Services Commission (FSC)
said. The figure equates to 14 percent of the government's promised debt
guarantee.
On Oct. 19, the government pledged to offer a three-year guarantee of up to
US$100 billion for foreign borrowing by local banks between late October and June
of next year.
Following the announcement, the watchdog received applications for foreign loans
to be guaranteed by the state.
"Local banks plan to make their own efforts to borrow overseas so that they do
not need to get the total state guarantee," the FSC said in a report to
lawmakers.
Local banks should reserve their future state-guaranteed borrowing from abroad to
roll over maturing foreign debts. Out of 18 commercial banks, 16 lenders plan to
receive the guarantee, the FSC said.
sooyeon@yna.co.kr
(END)