The state-run Export and Import Bank of Korea (Eximbank) said Tuesday it has set
up a loan program worth 200 billion won (US$176 million) to help local small and
medium-sized builders finance their overseas construction projects.
The loans will be extended in the form of export factoring, in which the lender
buys debts from a company without recourse, even if the firm does not receive
proceeds from the importer due to the buyer's insolvency or the like, the policy
lender said in a statement.
The loans have a maturity of two or three
months with an interest rate below that of other commercial banks at around 2
percent annually, it said.
The discount rate will depend on the credit
status of the company or the country where the project is based, adding that the
200 billion won set aside for the loan program is due to be exhausted before the
end of the year.
Smaller builders, which are more prone to economic
jolts, can benefit from the financing through being able to recover the proceeds
with less risks, Eximbank said.