The Export-Import Bank of Korea is to expand manufacturing financing for South Korean shipbuilders and loan to value (LTV) up to 100%, at most, for shipowners home and abroad.

Kim Yong-Hwan, head of Korea Eximbank announced on 6 February that it plans to provide ship financing totalling KRW 14.55trn ($13bn) in 2012 in an attempt to relieve difficulties facing upon by shipbuilders and shipping companies. 
 

Korea Eximbank is to loan and give guarantee for high-value vessels, including drillship, LNG carrier, etc., and issue letter of intent for buyers' credit loan in the early stage of order.

In particular, if delivery for already ordered vessel is put off by owners' financing problem, Korea Eximbank would support owners through expanded lending to owners and eased LTV, etc. and make delivery in due schedule.

Kim said, "As shipbuilding and shipping market getting difficult, Korea Eximbank decided to expand manufacturing financing for shipbuilders. Also the bank would ease LTV to 90-100% for not only newbuildings but used vessels, after legal investigation.

Meanwhile, regarding Sungdong Shipbuilding & Marine Engineering, he said that Korea Eximbank was having a monthly check on Sungdong's action plan after recently MOU been signed. Also, an accounting firm and a law firm are having inspection on Sungdong. Capital reduction is being discussed and a partial cash injection is planned next month.