Kim Byung-hwan, Financial Services Commission Chairman, "2 Trillion Won Invested Over 9 Years in Busan-Ulsan-Gyeongnam Companies"

Announcement of Busan Industrial Transition Green Fund
100 Trillion Won to Be Injected for Regional Economic Revitalization

Kim Byung-hwan, Chairman of the Financial Services Commission, has announced financial support measures for companies in the Busan, Ulsan, and Gyeongnam (Southeast region) areas. Over 2 trillion won in new funds will be used to expand investments in companies in the region over the next nine years. Institutions belonging to the Policy Finance Support Council will also inject 100 trillion won to revitalize the regional economy.

Chairman Kim announced these measures on the 10th at the ‘Busan Industrial Transition Green Fund Formation Announcement and Regional Companies Meeting’ held at the Busan International Financial Center. At the event, he promised to expand investment-focused support for regional companies and listened to their difficulties.

First, from this year until 2033, the ‘Busan Industrial Transition Green Fund’ will be established to invest more than 2 trillion won in new funds over nine years into mid-sized and prospective mid-sized companies in the Southeast region. In February this year, five major banks (KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup) agreed to contribute 50 billion won annually, totaling 250 billion won, to create a fund exceeding 500 billion won each year. Of the 250 billion won contributed by the banks, 20% (50 billion won) will be invested in the fund, and fund managers will attract more than 200 billion won in private capital to raise over 250 billion won annually.

The Financial Services Commission explained that the Southeast region has a high proportion of heavy and chemical industries such as steel and petrochemicals, resulting in significant demand for business restructuring and new investments due to digital and green transitions. Additionally, this fund is the first time Busan City has strengthened the subordinated tranche for bank contributions, reducing the banks’ investment burden and helping to form an investment-focused fund.

Financial Services Commission Chairman Kim Byung-hwan is speaking at a press briefing on recent issues held at the Government Seoul Office in Jongno-gu, Seoul, on the 22nd. Photo by Jo Yong-jun

Policy financial institutions will also work to revitalize the regional economy. Four institutions (Korea Development Bank, IBK Industrial Bank of Korea, Korea Credit Guarantee Fund, and Korea Technology Finance Corporation) will supply about 100 trillion won to non-capital regions, including 35 trillion won to the Southeast region, out of 247.5 trillion won in funds supplied this year. The Regional Revitalization Investment Fund, which completed 2.5 trillion won in investments last year, plans to discover promising local investment destinations to ensure more than 3 trillion won is invested this year as well.

Chairman Kim said about the fund formation, “This is a meaningful policy that simultaneously satisfies the important tasks of expanding support for regions in our corporate finance and increasing capital supply focused on equity investment,” and expressed gratitude to Busan City for leading a new cooperation model between local governments and financial institutions. He added, “The Financial Services Commission and policy financial institutions will pay special attention to regional industries and spare no support.”

Park Hyung-joon, Mayor of Busan Metropolitan City, said, “Despite the difficult domestic and international economic environment, this is an important time to strengthen industrial competitiveness centered on future growth industries. The ‘Busan Industrial Transition Green Fund’ will serve as an innovative catalyst that leads corporate growth not only in Busan but also in the Southeast region and transforms the regional economy’s structure.”