BOK to supply US$3 bln to local banks

SEOUL, Jan. 19 (Yonhap) -- South Korea's central bank said Monday it plans to provide US$3 billion to local banks suffering from a dollar liquidity crunch in the wake of the U.S.-sparked global financial turmoil.

The Bank of Korea (BOK) said the money is part of a $30 billion currency swap
agreement which it signed with the U.S. Federal Reserve in late October. The BOK
has tapped $13.35 billion out of the swap line so far.
The central bank plans to hold an auction Tuesday and the loans will mature in 84
days.
The move comes amid rising market jitters about South Korea's falling foreign
exchange reserves, the world's sixth-largest.
The country's foreign reserves -- which totaled $201.22 billion as of the end of
December -- fell for eight consecutive months in 2008, before climbing slightly
in December as a weaker U.S. dollar boosted the dollar value of assets in other
currencies.
South Korea also reached new currency swap arrangements with China and Japan in
late December, expanding its existing swap lines with the two countries to $30
billion each.
sooyeon@yna.co.kr
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