San-eun Attracts Trillions in Deposits from Korean Air and Asiana Airlines Supported by Policy Funds

[Asia Economy Reporter Bu Aeri] It has been revealed that the Korea Development Bank (KDB), which provided policy funds to airlines, has attracted deposits worth trillions of won from them.

According to data submitted by the KDB to Park Jae-ho, a member of the National Assembly's Political Affairs Committee from the Democratic Party of Korea, as of the end of the second quarter, Korean Air had deposited 1.9671 trillion won. The deposit balance from Asiana Airlines was also 1.9163 trillion won.

Park pointed out that the deposit amounts from these airlines surged after the government announced in November 2020 its plan to integrate Korean Air and Asiana Airlines through the KDB.

Korean Air's deposits at the KDB, which were 330.9 billion won in the second quarter of 2020, increased more than fivefold to 1.7494 trillion won in the first quarter of 2021. Asiana Airlines' deposits at the KDB also nearly tripled from 392.4 billion won in the third quarter of 2020 to 1.1303 trillion won in the first quarter of 2021.

Air Busan and Air Seoul, subsidiaries of Asiana that had no prior transactions with the KDB, began depositing retirement pensions and other funds at the KDB as the integration movement gained momentum. Air Busan and Air Seoul deposited 7.1 billion won and 10.1 billion won respectively at the KDB.

Park stated, "It is inappropriate for the KDB, which disburses policy funds, to engage in 'forced sales' practices that cleverly evade legal boundaries targeting struggling companies from a 'superior' position." He added, "As a national policy financial institution, a responsible attitude is necessary toward companies facing difficulties due to economic recession and financial pressure."