KB Kookmin Bank to Provide $230 Million in Financial Support for SMEs Affected by Middle East Conflict

KB Kookmin Bank is set to provide 230 billion won (approximately $230 million) in financial support to assist small and medium enterprises (SMEs) facing challenges due to the ongoing conflict between the U.S., Israel, and Iran.

On May 22, the bank announced it has signed a memorandum of understanding with the Technology Guarantee Fund to implement inclusive financial support aimed at helping SMEs overcome crises stemming from the Middle East conflict and global instability.

According to the Ministry of SMEs and Startups, as of May 20, the number of reported cases of damage and concerns related to SMEs affected by the Middle East conflict has risen to 834, an increase of 35 from the previous week.

Of the reported cases, 628 involved damage or difficulties, while 135 were categorized as concerns. The most common issue reported was transportation disruptions, accounting for 276 cases (43.9%), followed by other issues at 232 cases (36.9%). The prolonged conflict between the U.S. and Iran has led to a diversification of reported damages.

In response, KB Kookmin Bank plans to make a special contribution of 5 billion won to the Technology Guarantee Fund, which will facilitate approximately 230 billion won in guarantee-backed loans. This includes 60 billion won in special contribution guarantees and about 170 billion won in guarantee fee support.

Eligible companies must meet the technical requirements set by the Technology Guarantee Fund and include those directly exporting to the Middle East, companies affected by disruptions in the supply chain of Middle Eastern crude oil, and those facing difficulties due to rising exchange rates and logistics costs.

These companies can receive a guarantee certificate with a 100% guarantee rate for three years through the special contribution agreement. They may also choose to receive a total of 1.2 percentage points in guarantee fee support over two years.

A representative from KB Kookmin Bank stated, "We hope this agreement will provide practical assistance to companies that have suffered direct and indirect damages, as well as those facing financial burdens due to high oil prices and exchange rates. We will continue to support SMEs as their financial partner."