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KAMCO Signs MOU with Court for Efficient Corporate Rehabilitation Program
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KAMCO Signs MOU with Court for Efficient Corporate Rehabilitation Program
  • By matthew
  • July 23, 2015, 05:45
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President Hong Young-man (left) of KAMCO and Lee Sung-ho (right), the Chief Justice of Seoul Central District Court take a photo after signing an MOU.
President Hong Young-man (left) of KAMCO and Lee Sung-ho (right), the Chief Justice of Seoul Central District Court take a photo after signing an MOU.

 

On July 20, in a bid to improve efficiency in the corporate rehabilitation process, the Korean Asset Management Corporation (KAMCO) signed an MOU with Seoul Central District Court. In the program, KAMCO will raise funds by purchasing assets and then liquidate those assets through sale and re-lease.

This agreement will equip KAMCO and the Court with a comprehensive foundation for coordinating the corporate restructuring process for small and medium enterprises (SMEs). Namely, KAMCO and the Seoul Central District Court will cooperate in providing financial support for financially-distressed SMEs via the sales of their assets and re-lease them as part of the rehabilitation process. Overall, they will diagnose management problems and provide support for SMEs undergoing restructuring.

KAMCO would buy and lease the assets of SMEs that apply for the rehabilitation program titled “Purchase and Lease Assets.” From the perspective of financially-distressed SMEs, this program has the same effect as offering new funding.

For those who apply for KAMCO’s “Purchase and Lease Assets,” local financial institutions that concluded an agreement with KAMCO will provide support by auditing and overseeing operational costs and debt restructuring. This assistance is all geared towards helping SMEs in question to overcome a liquidity crisis and quickly bringing them back to normal operations.

For SMEs with applications for rehabilitation still underway, KAMCO will incorporate the record of “Purchase and Lease Assets” in the document. This way, those SMEs can maintain the value of their enterprises. It also helps increase the chances to secure a rehabilitation plan and receive support. 

This MOU will facilitate a smooth rehabilitation process by ensuring that the SMEs obtain the necessary funds through the liquidation of assets and maintain trading value. Also, by leasing the asset, these SMEs can continue to maintain the foundation of their businesses.

Meanwhile, in relation to the Purchase and Lease Assets program, KAMCO also signed MOUs with financial institutions like Pusan Bank, Industrial Bank of Korea, Gyeongnam Bank, Woori Bank, Hana Bank, and Shinhan Bank in order to promptly provide financial support.

President of KAMCO Hong Young-Man said, “As an organization specializing in the management of distressed debts and restructuring funds, we consider it very meaningful to establish a comprehensive framework for coordination with the Court for a rehabilitation program.”