KAMCO to Provide Liquidity to SMEs through Direct Purchase of Collateralized Assets

[Asia Economy Reporter Song Seung-seop] Korea Asset Management Corporation (KAMCO) announced on the 22nd that it will newly introduce and operate the 'Movable Asset Collateral Direct Purchase (S&LB) Program,' which supplies liquidity to companies that have taken out loans using movable assets as collateral.

The S&LB program is a policy by KAMCO's Movable Asset Finance Support, established in March last year, that purchases movable collateral such as machinery or equipment owned by companies undergoing structural improvement to provide liquidity, and then leases the machinery and equipment back to the companies so they can continue to use them. KAMCO directly appraises the machinery and equipment owned by the companies and purchases them at a fair price by applying the bid rate. Medical devices and construction machinery, which are difficult to sell or lease under relevant laws, are excluded.

Companies undergoing structural improvement, which have been facing increased difficulties due to the prolonged COVID-19 pandemic, can use the S&LB program to repay existing loans and restore normal business operations. From the perspective of banks that lent money to these companies, it allows them to prepare in advance for potential defaults on movable asset collateral loans.

Moon Sung-yoo, President of KAMCO, said, "We hope this program will help small and medium-sized enterprises experiencing temporary liquidity shortages to normalize their management," and added, "KAMCO will not only play a leading role in movable asset finance but also work to prevent the occurrence of non-performing loans."