Shinhan, Hana, and Woori Banks Provide 1 Trillion Won to Support Korean Shipbuilders

Major commercial banks are launching a 1 trillion won financial support initiative to enhance the export competitiveness and supply chain stability of the shipbuilding industry.

On May 14, financial sources reported that Shinhan Bank, Hana Bank, and Woori Bank signed a financial cooperation agreement to provide 1 trillion won to the suppliers of their main client companies, Samsung Heavy Industries, HD Hyundai Heavy Industries, and Hanwha Ocean.

The signing ceremony took place on May 13 at the Hotel Hyundai by Lahan in Ulsan, attended by Minister of Trade, Industry and Energy Kim Jeong-kwan, Financial Services Commission Chairman Lee Ok-won, and the presidents of the three banks, among others.

This agreement aims to provide stable liquidity to the suppliers of the shipbuilders, strengthening the export supply chain and supporting the co-prosperity of large corporations with small and medium-sized enterprises. President Yoon Suk Yeol emphasized the importance of government support for maintaining employment and developing the shipbuilding ecosystem during a meeting with industry representatives the previous day.

Initially, Shinhan Bank and Samsung Heavy Industries will jointly contribute 21.3 billion won, with the Korea Trade Insurance Corporation providing a total of 300 billion won in special guarantees to Samsung Heavy Industries' suppliers. The selected companies will benefit from liquidity support through special guarantees and full coverage of guarantee fees, reducing their financing costs.

Hana Bank plans to provide a total of 400 billion won in financing to support the management stability of small shipbuilders and equipment suppliers in collaboration with HD Hyundai Heavy Industries. Earlier in January, the two companies contributed a total of 28 billion won (Hana Bank 23 billion won, HD Hyundai Heavy Industries 5 billion won) to the Korea Trade Insurance Corporation and signed a business agreement for preferential financial support for recommended suppliers.

Woori Bank also plans to supply a total of 300 billion won in financial support through a joint contribution with Hanwha Ocean, with Woori Bank contributing 17.8 billion won and Hanwha Ocean 3.5 billion won. The two banks will utilize the Trade Insurance Corporation's guarantee program to provide trade finance and corporate working capital loans to small and medium-sized suppliers within the shipbuilding supply chain.