Eun Seong-su Chairman: "Ssangyong Motor Decision by Main Creditor Bank... Additional Support for LCC"

[Asia Economy Reporter Kangwook Cho] Eun Sung-soo, Chairman of the Financial Services Commission, said on the 28th regarding support for Ssangyong Motor, which is facing management difficulties, "It is a matter for the main creditor bank to decide."

After the launch ceremony of the Industrial Stabilization Fund held at the headquarters of the Korea Development Bank in Yeouido on the same day, Chairman Eun met with reporters and said about the possibility of Ssangyong Motor receiving support from the fund, "The creditor bank will first make a judgment and either share opinions with us or make an independent decision."

However, he added, "We need to determine whether the issue is due to the novel coronavirus infection (COVID-19) or a fundamental problem." This is interpreted to mean that since the purpose of the fund is to help companies struggling with liquidity due to the impact of COVID-19, it is necessary to assess whether Ssangyong Motor falls under that category.

Regarding additional support for Doosan Heavy Industries, he said, "There will be a meeting of ministers related to strengthening industrial competitiveness tomorrow (the 29th)," and added, "This is not something new; all plans were made initially and are currently undergoing review and approval in consultation with the creditor group."

On the support plan for low-cost carriers (LCCs), Chairman Yoon said, "We are monitoring the progress, and it is not important to exclude LCCs from the fund support because they are already included in the 135 trillion won program," adding, "Funds have already been provided, and more will be given if necessary." He further clarified, "However, whether to support through the fund or use other methods is a matter for the Korea Development Bank, not the LCCs."

Regarding the controversy that the Bank of Korea has put a brake on the operation of the Special Purpose Vehicle (SPV) for purchasing low-credit corporate bonds and commercial papers (CP), he denied it.

He said, "The Bank of Korea directly lends 8 trillion won through the SPV and therefore has responsibility, so it can provide opinions on operations," adding, "However, since the practical work is done by the Korea Development Bank, both institutions will cooperate well."