S. Korea pushes to expand size, maturity of currency swap with U.S.

SEOUL, March 17 (Yonhap) -- South Korea is pushing to expand the size and
maturity of its US$30 billion currency swap deal with the United States as part
of efforts to better prepare for a liquidity crunch, a high-ranking official said
Tuesday.

"Finance Minister Yoon Jeung-hyun asked for his U.S. counterpart Timothy Geithner
to expand the size and maturity of the currency swap line during the Group of 20
meeting in London," Deputy Finance Minister Shin Je-yoon told reporters during a
briefing on the gathering which ended on Sunday.
"There was no specific response from Geithner," he added, declining to elaborate
further on the issue. He did dismiss some media reports that the government is
pushing to expand the swap size to $100 billion, saying he was not aware of that.
In October, South Korea's central bank announced the $30 billion currency swap
agreement with the U.S. Federal Reserve and it has tapped $16.35 billion from the
swap line so far. South Korea has similar currency swap deals with Japan and
China.
The request comes after both countries agreed in February to extend the maturity
of the deal by six months until the end of October. The contract was to expire on
April 30.
The use of the swap facility helped ease fears about declining foreign reserves.
The Korean currency fell 25.7 percent to the dollar last year alone, becoming one
of the world's worst-performing currencies.
Recently, South Korean financial markets have been buffeted by spreading rumors
that they could face a crisis as a large chunk of foreign capital could leave the
country this month. This caused some foreign media to raise questions about the
health of the Korean economy, which the government has brushed off as totally
groundless.
kokobj@yna.co.kr
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