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By Lee Kyung-min
Financial groups in Korea are rushing to set up control centers for efficient market monitoring in a collective move to prevent virus-triggered financial risks translating into corporate deterioration, industry officials said Thursday.
Key tasks are assigned to different teams to diversify risk absorption while efforts are ongoing to maintain lines of credit to the hardest-hit borrowers including lowering interest rates and extending credit guarantee-mediated loans to many small and medium-sized enterprises (SMEs).
Woori Financial Group said it set up an emergency management control center Tuesday to better counter possible fallout from rapidly escalating financial market volatility.
They will make a recommendation on the previous corporate strategy following close monitoring and analysis of key macro and real market indices including interest rates, growth outlook, foreign exchange rates, oil prices and the stock market.
A number of teams set up will be tasked with primary functions ranging from overall corporate strategies, financial management, risk management and market monitoring.
"We decided to come up with measures to better counter uncertainties brought on by rapidly changing market conditions and the impact on the bank's business stability," a Woori official said.
The bank will assemble a team of young talented individuals to formulate corporate strategies needed in times of uncertainty including contingency plans in stages.
"The new coronavirus is bringing about fundamental changes not only to financial market participants but also to the public at large. We will prepare for various scenarios according to which we will adjust our management objective, customer service strategies and coordination plans with the financial authorities," he added.
State-run Industrial Bank of Korea (IBK) dispatched 120 workers to various regions hit hardest by the virus spread to help SMEs seek and extend credit guarantee-mediated loans offered by the Korea Federation of Credit Guarantee Foundations.
A group of senior IBK workers nearing the retirement age will be able to use their years of experience to provide consultations and recommendations of what will best meet the financing needs of the SMEs. The extra guidance from these workers also helps SMEs through the loan application process, ensuring that there are no mistakes that could lead to rejections or delays.
"We are aware that many SMEs are having difficulty in having this particular type of loan request processed as fast as they need, so we thought we would be of great help by sending more workers where they are needed," an IBK official said.
Owners of SMEs are seeking credit guarantee-mediated loans for which banks must have a guarantee from regional branches of the foundation that approves eligibility requirements.
The papers submitted by the Small Enterprise and Market Service (SEMS), a quasi-government organization supervised by the Ministry of SMEs and Startups, must substantiate the extent and degree of how earnings of the businesses have dropped under certain "adverse" circumstances.
