iM Bank said on Feb. 19 it will make special contributions to the Daegu Credit Guarantee Foundation and the North Gyeongsang Credit Guarantee Foundation to support mutual-growth finance for local small merchants. It said it will supply a total of 260 billion won in mutual-growth finance to local small merchants.

The support is based on special contributions worth a total of 14.2 billion won, including 5.4 billion won to the Daegu Credit Guarantee Foundation and 8.8 billion won to the North Gyeongsang Credit Guarantee Foundation. Of that, iM Bank’s sole contribution is 8 billion won and local governments’ matching contributions total 6.2 billion won.

iM Bank’s sole contribution will be used to support about 110 billion won in guaranteed loans for small merchants in alley commercial districts and traders in traditional markets in Daegu and North Gyeongsang.

The local government-matched contributions will be used to run special guarantee programmes for small merchants in the area. Under the scheme, iM Bank and basic local governments in Daegu and North Gyeongsang each contribute the same amount to the relevant local credit guarantee foundation. The support 규모 in the first half of this year reaches about 150 billion won.

Small merchants in the Daegu and North Gyeongsang region can receive guarantees for 90 to 100 percent of their loans through the Daegu and North Gyeongsang credit guarantee foundations. Using the guarantee certificate as collateral, they can take out low-interest special guaranteed loans at iM Bank branches designated for the programme.

In particular, small merchants based in local governments participating in the matched contribution programme will receive support equivalent to 3 percentage points in loan interest rates. Additional benefits such as reduced guarantee fees are also expected to be provided.

Chief Executive Officer Jung-hoon Kang (강정훈) said, "As a regional hub commercial bank, iM Bank will use this large-scale special contribution to return profits to the local community and be reborn as a solid pillar for local small merchants."