Risky Loans Require More Data
Starting as early as July, companies with signs of insolvency risks will have to provide statements outlining their management improvement goals and rescue plans when receiving loans.The Finance Ministry said Sunday that it would ask the National Assembly to pass the new requirement next month.
Currently, financial institutions are only advised to ask for management improvement plans when extending loans to weaker companies. Once the new regulation is in effect, firms will be rated for fulfillment of their agreements; those that fail to meet their goals will be targeted for receivership or other bankruptcy procedures.
with the Korea JoongAng Daily
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