Hana Bank is joining hands with the Korea Technology Finance Corp to support small and medium-sized companies pursuing business succession and mergers and acquisitions (M&A).

Hana Bank said on May 11 it signed a financial support agreement for business succession and M&A at the Korea Technology Finance Corp’s Seoul office on May 7.

The aim is to support generational change and the growth of technology-innovation companies as SMEs face difficulties in business succession due to ageing and other factors.

Hana Bank will contribute a total of 2 billion won, including 1.5 billion won in special contributions and 500 million won in guarantee fee support. The Korea Technology Finance Corp plans to supply 65.7 billion won in guaranteed loans based on the funding.

The support targets acquiring companies pursuing business succession and M&A. It will provide working capital and facility funding. Benefits include a guarantee ratio of up to 100 percent and a reduction in guarantee fees of up to 0.7 percentage points.

Seo Yoo-seok (서유석), deputy head of Hana Bank’s Corporate Group, said the bank will support SMEs facing difficulties in raising funds so they can pursue business succession and technological innovation through M&A.