Taekwang Industrial co-CEOs Jeong In-cheol (center) and Lee Bu-eui (right) pose with Woori Bank corporate group head Bae Yeon-su at a win-win loan signing ceremony held Monday at the company's headquarters in Jangchung-dong, Jung-gu, Seoul. [Taekwang Industrial]
Taekwang Industrial co-CEOs Jeong In-cheol (center) and Lee Bu-eui (right) pose with Woori Bank corporate group head Bae Yeon-su at a win-win loan signing ceremony held Monday at the company's headquarters in Jangchung-dong, Jung-gu, Seoul. [Taekwang Industrial]

Taekwang Group is rolling out a range of financial support measures across its affiliates to ease the financial burden on small and midsize partner companies and vulnerable households amid rising interest rates.

Taekwang Industrial announced Tuesday that it signed a "win-win loan agreement for partner company financial support" with Woori Bank on Monday afternoon at its headquarters in Jangchung-dong, Jung-gu, Seoul. Under the agreement, the win-win loan fund was expanded from 10 billion won ($6.74 million) to 50 billion won, and the per-company loan ceiling was raised from 500 million won to 1 billion won.

The win-win loan program uses interest earned on fixed deposits that Taekwang Industrial holds with partner financial institutions to subsidize lower lending rates for its suppliers. The company first signed a win-win cooperation agreement with Shinhan Bank in 2020 and has continued the support for seven years, including this year.

A total of 121 Taekwang Industrial partner companies are eligible for the program. When those suppliers take out loans at Shinhan Bank or Woori Bank branches nationwide, their interest rates are reduced by 3.16 percentage points and 3.59 percentage points, respectively. As of the end of last month, 15 partner companies were using 6.15 billion won in win-win loans.

"We hope this agreement will provide small and midsize partner companies with practical help in securing the funding they need on better terms, strengthening their management stability and competitiveness," co-CEO Jeong In-cheol said. "We also hope it will go beyond simple financial support to further solidify trust with our partners and serve as a foundation for shared growth."

Meanwhile, Koryo Savings Bank and Yegaram Savings Bank — financial affiliates of Taekwang Group — plan to write off 26.9 billion won in long-overdue debt to help financially vulnerable borrowers get back on their feet. By institution, Koryo Savings Bank accounts for 26.3 billion won and Yegaram Savings Bank for 600 million won.

The two banks selected the debt to be written off after reviewing factors including the length of delinquency, repayment capacity, recoverability and the borrower's economic circumstances, focusing on cases where debt relief could translate into meaningful recovery support.

"We decided to write off the long-overdue debt rather than sell it, in order to give financially vulnerable borrowers a chance to rebuild their lives," a Koryo Savings Bank official said. "We hope this helps them escape the burden of high interest rates and debt collection and return to normal financial life."


yeongdai@heraldcorp.com