One large, two mid-size managers chosen; policy banks to contribute 450 billion won

Fund to support growth financing, overseas expansion for small and venture firms

Industrial Bank of Korea headquarters [Industrial Bank of Korea]
Industrial Bank of Korea headquarters [Industrial Bank of Korea]

The Industrial Bank of Korea, together with Korea Development Bank and Export-Import Bank of Korea, is moving to establish a 700 billion won ($522 million) Policy Finance Institution Global Scale-Up Cooperation Fund.

Industrial Bank of Korea announced Thursday that the three banks had jointly selected three fund managers to oversee the vehicle.

The fund was launched in September as a joint investment project by the three policy banks to support growth financing and overseas expansion for small, mid-size and venture companies. It is one of seven key joint cooperation projects pursued by the Policy Finance Institution Council, which was established in March.

The three institutions reviewed seven asset management firms that applied and selected one large-fund manager and two mid-size fund managers. The large fund will be sized at 300 billion won, while each of the two mid-size funds will be sized at 200 billion won.

The selected managers plan to raise additional private capital on top of the 450 billion won committed by the three banks to assemble the full 700 billion won fund. Each of the three policy banks will contribute 150 billion won.

The proceeds will be used to support scale-up efforts and overseas market entry by small, mid-size and venture companies. Through the joint commitment, the three banks plan to deepen cooperation among policy finance institutions and expand the supply of risk capital.

"We will continue to play a leading role in the venture capital market while sustaining ongoing collaboration among policy finance institutions to drive innovative growth and expand productive finance," an Industrial Bank of Korea official said.


rim@heraldcorp.com