iM Bank said on Feb. 26 it signed a business agreement with Daegu and the Korea Credit Guarantee Fund for financial support to foster small and midsized companies engaged in strategic industries in Daegu.

The agreement was 추진됐다 to strengthen the industrial base by providing financial support to companies in Daegu engaged in local strategic industries.

It is part of iM Financial Group’s plan to supply a total of 45 trillion won in productive finance over the next five years. iM Bank signed a “productive finance support package” agreement with the Korea Credit Guarantee Fund in December last year and decided to 추진하기로 한 바 있다 to supply productive finance worth 150 billion won.

The program will be run through cooperation among the private, public and government sectors, and some preferential terms will apply to eligible companies through Daegu’s participation. iM Bank will contribute a total of 1.5 billion won to the Korea Credit Guarantee Fund, including 1.2 billion won in a special contribution and 300 million won in guarantee fee support.

Using the funds, guaranteed loans worth 40.2 billion won are expected to be provided through KODIT guarantees. Daegu will support interest subsidies worth 1.7 percentage points a year for two years on the loans.

Under the “special contribution agreement guarantee”, KODIT guarantees the full amount of the loan for three years from the loan date and applies a preferential guarantee fee rate of 0.2 percentage points. Under the “guarantee fee support agreement guarantee”, iM Bank will support guarantee fees equivalent to 0.5 percentage points for three years.

Eligible recipients include companies engaged in key local industries, companies engaged in new growth engine industries, and exporting companies.

The loan process begins after a loan recommendation under Daegu’s small business management stabilization fund program, in the “local strategic industry fostering” category. It then proceeds through guarantee consultation and screening at a KODIT branch, and, if the guarantee is approved, a loan agreement is signed at an iM Bank designated branch.

Chief Executive Officer Kang Jung-hoon (강정훈) said, “In the rapidly changing international trade environment and intensifying competition, it is time for systematic fostering and support of local strategic industries for Daegu companies to secure global competitiveness.” He added, “iM Bank will actively support timely fundraising and technological innovation for local companies.”