Korea Technology Finance Corporation (KOTEC) said on the 10th that it supported a total of 586.5 billion won in annual fundraising for technology small and midsize enterprises by issuing 299.2 billion won in P-CBOs (primary collateralized bond obligations) in the second half of this year.
A P-CBO is a structure in which an SPC (special-purpose company) purchases bonds issued by technology small and midsize enterprises that have difficulty raising funds on their own due to low credit ratings and then issues asset-backed securities using them as the underlying asset. KOTEC provides guarantees on the debt borne by the SPC so that technology small and midsize enterprises can raise funds in the direct financing market.
Through 586.5 billion won in P-CBOs this year, KOTEC supported scale-up funds for 303 technology small and midsize enterprises. That is an increase of 110 billion won from last year.
Of the P-CBOs issued this year, 522.3 billion won was used for new funding support and 64.2 billion won was used for existing bond refinancing. In particular, 79.5 billion won of the new issuance was issued as green asset-backed securities (G-ABS) to support the fundraising of 33 corporations engaged in economic activities aligned with the Korea Taxonomy (K-Taxonomy) and to contribute to revitalizing the green economy.
G-ABS is a product introduced last year through cooperation among KOTEC, the Ministry of Climate, Energy and Environment, and the Korea Environmental Industry & Technology Institute (KEITI). This year, the interest subsidy period was expanded to three years, with up to 3.0 percentage points in the first year and an interest subsidy equal to half of the first-year support amount in the second and third years, which is expected to reduce the financing expense burden on eco-friendly management corporations.
KOTEC plans to continue issuing P-CBOs and G-ABS next year to ease funding difficulties for technology small and midsize enterprises and support scale-ups, while strengthening cooperation with related institutions to enhance the effectiveness of policy finance.
Chair KIM Jong-ho of KOTEC said, "We will take the lead in strengthening the growth ladder for technology small and midsize enterprises by expanding policy support so that small and midsize enterprises can secure technological competitiveness in the global market and leap into mid-sized corporations."