Capital Funds

Capital Fund

KODIT's capital funds are the financial resources prerequisite for KODIT to maintain its public trust, to provide credit guarantee, to make payment under guarantees and to earn revenue from managing the surplus capital funds. The main sources of the capital funds are the contributions from the government, financial institutions and enterprises.

The contribution from the government is subject to change every year depending on the government's policy on credit guarantees. On the other hand, according to the Korea Credit Guarantee Fund Act (KODIT Act), all the banks in Korea have to contribute funds to KODIT. These contributions, a main systematic tool for raising capital funds, are calculated on the balances of banks for specific loans at a certain rate not exceeding 0.3% per annum.

With KRW 142billion from the government and KRW 885billion from financial institutions and corporations in 2018, the underlying asset of KODIT at the end of 2018 reached KRW 5,091billion.

Calculated by dividing the credit guarantee amount at a given period by the underlying asset, an operation multiple is a measure that indicates capabilities to supply guarantees in accordance with government policies and guarantee demands and payment capacity for subrogation to banks. Article 25 of the Credit Guarantee Fund Act prohibits the operation multiple of over 20. The ratio stands at 9.9 as of 2018.

Capital Fund & Operation Multiple

Unit : KRW billion, times