Hana Bank CEO Ji Sung-kyoo, fourth from left, and Doosan Heavy Industry & Construction COO Jung Yeon-in, fourth from right, take a group photo after signing a memorandum of understanding for cooperation for the “Korean New Deal,” initiative at the lender‘s headquarters in central Seoul on July 24. (Hana Financial Group)
South Korea’s major banking groups have recently outlined long-term plans for multitrillion won investments in “green” and “digital” projects -- the two key pillars of the “Korean New Deal.”
Staying true to its identity, agricultural NH NongHyup Bank said Wednesday that it would commit 8 trillion won ($6.7 billion) over five years to support new energy projects and loans for smart farms, which would enable greater use of information and communication technology in farming.
The bank will focus on fostering projects tied to the government’s “Green New Deal” initiative that facilitate the transition to renewable energy from thermal power.
The lender said it will prepare a special loan program based on criteria for environmental, social and corporate governance.
Other banking groups have also been quick on their feet to roll out investment plans since the government announced 160 trillion won worth of economic support packages amid the coronavirus pandemic in July.
Woori Financial Group, which previously announced a five-year plan to funnel 10 trillion won into New Deal projects, held a CEO-level meeting on Friday to discuss the topic. Group Chairman Sohn Tae-seung presided.
After the meeting, the bank said it had officially decided to pursue new business related to data development and to accelerate the digitalization of the group’s business to create a more contactless work environment.
To support the government-led initiative, the company has also decided to expand corporate investment in eco-friendly businesses and make fresh investments worth more than 200 billion won in renewable energy and other green business areas.
Hana Financial Group last month pledged 10 trillion won for its own Korean New Deal projects, saying it would invest in building digital infrastructure and broker investments in various forms of renewable energy.
Accordingly, it signed an agreement with Doosan Group to provide direct and indirect financing for the group’s renewable energy business, focusing on Doosan Heavy Industry & Construction’s wind power projects and Doosan Fuel Cell’s hydrogen fuel cell projects.
KB Financial Group said last month that it would invest 9 trillion won by 2025 into a range of projects that integrate digital and green ideas, including some involving green smart schools, the digitalization of social overhead capital and green energy.
Shinhan Financial Group has been making its own efforts by combining Korean New Deal values with its goals of financially supporting promising industries and digital finance.
The state-run Korea Development Bank said last week that it had raised a combined 8.6 trillion won in commitments for the signature “Growth Support Fund,” a state-backed financing program for venture firms.
KDB vowed to expand its investment to support four key areas of the Korean version of the New Deal – contactless service, data, networks and artificial intelligence. Another state-run lender, the Industrial Bank of Korea, said Friday that it would cooperate with its credit financing subsidiary IBK Capital to launch funds related to the government’s new economic policy. It plans to establish five such funds worth a total of 185.5 billion won in the second half of the year.
By Jung Min-kyung (firstname.lastname@example.org)