Creditors of the ailing Dongbu Steel said Tuesday they will provide 160 billion won ($157 million) in loans to the company, whose foiled sale has put the parent group’s self-rescue efforts on hold.

The Korea Development Bank, the main creditor of Dongbu Steel, said the loan approval process has begun for granting the loan to help the steelmaker cover its costs. A loan can be extended to a company undergoing restructuring if it is approved by creditors who control more than 75 percent of the company’s debt.

KDB currently holds 53 percent of the steelmaker’s debts, followed by Korea Finance Corporation and NongHyup Bank with 14.96 percent and 10.13 percent of Dongbu’s debts, respectively.

Earlier this month, creditors had agreed to support normalization plans outlined by the steelmaker’s parent firm Dongbu Group.

(hnpark@heraldcorp.com)