(1888PressRelease)
November 02, 2008 - London, The government guaranteed $100 billion of lenders' foreign-currency debt and pledged $30 billion in dollars to banks.
Asia’s third largest economy has seen its currency won being battered while its banks struggled to raise the dollars it needed to pay foreign debt.
South Korean finance minister Kang Man-soo said, “The government has decided to join in global coordinated efforts to stabilize financial markets and we’ll continue to provide pre-emptive, decisive and sufficient measures to this end.” He added, “We believe providing the government guarantee on banks’ foreign exchange dealings is the strongest step to save our foreign exchange reserves.”
Markets expect the central bank to cut interest rates at its next policy meeting on Nov 7. Early this month the Bank of Korea cut the benchmark interest rates early by a quarter of a percentage point to five per cent- the first rate cut in nearly four years.
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