Starting on the 29th of next month, the credit lines of corporations where a serious industrial accident occurred will be reduced. Also, records of serious industrial accidents will be shared across the entire financial sector through the Korea Credit Information Services and added to credit evaluation items.
According to the financial industry on the 28th, six domestic banks, including Woori Bank and KB Kookmin Bank, partially revised their corporate credit transaction agreements. If news coverage that could negatively affect a corporation's credit standing or creditworthiness is confirmed as true, or if an investigation is opened or legal disputes arise, the banks will reduce or suspend credit lines.
A corporation's credit line is a concept similar to a corporate overdraft account. Restricting it means the bank will cut a corporation's loan limit or refuse to extend new credit. The revised rules will take effect on the 29th of next month.
Along with this, the financial authorities are revising banks' credit evaluation standards so that the history of serious industrial accidents, such as fatal accidents, is more heavily reflected in credit screening. Accident histories will also be shared across the entire financial sector through the Korea Credit Information Services. Until now, banks have assessed qualitative factors in credit evaluations—such as a corporation's basic management and business risks—but have not explicitly reflected corporate serious industrial accidents.