SEOUL - The South Korean government has announced plans to inject approximately 2 trillion won ($1.51 billion) into the Korea Development Bank (KDB) to enhance its financial stability and ability to support business financing.
According to Yonhap News Agency, the Ministry of Economy and Finance along with the Financial Services Commission are currently finalizing the details to provide the funds to the KDB by the end of the month. The capital infusion is expected to be accomplished through the transfer of government-owned stocks in various public companies to the bank.
Officials stated that the investment is aimed at improving the bank's capital adequacy and supporting its financing plans. The capital increase is projected to bolster the KDB's financial health significantly.
At the close of the third quarter of the previous year, the KDB reported a capital adequacy ratio, also known as the BIS ratio, of 13.66 percent. Financial regulations recommend that banks maintain a BIS ratio above 13 percent to ensure financial stability, indicating that the KDB's financial status is within recommended levels but could benefit from additional capital.