The Korea Technology Finance Corporation (KTFC) (Chairman Kim Jong-ho, hereinafter referred to as “KIBO”) announced that it signed a “Mutual Financial Support Agreement for Supporting Scale-up of Technology SMEs in the Busan-Ulsan-Gyeongnam (hereinafter referred to as “BU-Ul-Gyeong”) Region” with the Korea Housing Finance Corporation (CEO Kim Kyung-hwan, hereinafter referred to as “KHFC”) at the KHFC headquarters in Busan on Tuesday the 30th.
This agreement was established to establish an organic cooperative system between the two organizations and support smooth financing and innovative growth of small and medium-sized technology companies in the Busan-Ulsan region through the issuance of collateralized bond obligations (P-CBOs).
P-CBOs are securitized securities issued by small and medium-sized technology companies that have difficulty raising funds through their own credit, using newly issued corporate bonds as underlying assets. Kibo supports small and medium-sized technology companies in securing long-term funds directly and stably from the financial market through credit enhancement.
Under the agreement, KIBO will be responsible for identifying and evaluating target companies in the Busan-Ulsan region, as well as overseeing the issuance of P-CBOs. Korea Development Bank will underwrite these P-CBOs, thereby supporting financing for technology SMEs. Furthermore, the two organizations plan to cooperate to ease the burden on companies by providing financial cost reductions and support for companies included in the underlying asset class.
This agreement is expected to create a synergy effect that will contribute to the revitalization of the local economy and balanced regional development by systematically supporting the scale-up of promising local technology companies through collaboration between two public institutions located in Busan.
Kibo CEO Lee Sang-chang said, “This agreement is significant in that it supports the scale-up of local technology SMEs and realizes social value through shared growth with the local community.” He added, “Kibo will continue to expand cooperation with related organizations to become a strong partner that supports the innovative growth of local companies.”
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