Suhyup Central Association Establishes Subsidiary Sh Daebu... Restructuring 300 Billion KRW Non-Performing Loans

▲Nodongjin, President of the National Federation of Fisheries Cooperatives

The National Federation of Fisheries Cooperatives (SuHyup) announced on the 22nd that it is pushing forward with the establishment of a subsidiary to manage non-performing loans of member cooperatives nationwide.

On the same day, SuHyup held a board meeting and approved a capital investment proposal to establish a subsidiary tentatively named 'Sh Daebu' that will purchase and collect non-performing loans from 90 member cooperatives across the country.

Accordingly, SuHyup plans to immediately begin the loan business registration process and aims to start early resolution of the cooperatives' non-performing loans within this year at the earliest.

SuHyup will invest 50 billion KRW as capital for this subsidiary and, by borrowing from SuHyup and SuHyup Bank, will manage non-performing loans worth around 300 billion KRW.

A SuHyup official explained, "The purpose is to improve asset soundness by reducing non-performing loans early," adding, "The subsidiary will purchase non-performing loans entrusted by the cooperatives and then proceed with recovery procedures to help reduce delinquencies."

They further added, "If a profit from sales occurs as a result of recovery, the subsidiary will return the earnings to the cooperatives through post-settlement."

SuHyup stated that it chose to manage non-performing loans through a subsidiary to prevent profits from sales from leaking outside.

In the future, SuHyup plans to increase capital through additional investments to expand the capacity to purchase non-performing loans and enhance the effect of reducing delinquencies.

Labor Jin, Chairman of SuHyup, said, "If non-performing loans are not properly resolved, there is concern that the external creditworthiness of member cooperatives engaged in financial business will be adversely affected, which is why we are promoting the establishment of this subsidiary." He added, "Going forward, SuHyup will actively support the subsidiary Sh Daebu to become a cornerstone in restoring asset soundness and increasing trust for the cooperatives."