BOK supplies US$2 bln to local banks

By Kim Soo-yeon
SEOUL, June 9 (Yonhap) -- South Korea's central bank said Tuesday it has supplied
US$2 billion to local banks, less than what it had previously offered, as the
country's trade balance and overseas borrowing conditions improved.
The Bank of Korea (BOK) said it re-offered the amount to 10 local lenders through
84-day swap deals earlier in the day out of the $3 billion in loans it extended
in March that mature on Thursday.
The money is part of a $30 billion currency swap agreement signed with the U.S.
Federal Reserve in late October.
The move lowered the total amount the bank tapped from the swap line to $10
billion from $11 billion, the BOK added.
South Korea's central bank has been reducing its dollar supply since late March
as foreign currency market conditions have improved.
Local banks, saddled with high overseas short-term borrowing, had been suffering
from dollar shortages, sparking concerns they could face difficulty in meeting
financial needs and servicing their debt.
South Korea's foreign exchange reserves rose by the largest monthly amount in
May. The reserves totaled $226.77 billion as of the end of May, the sixth-largest
in the world.
South Korea also reached new currency swap arrangements with China and Japan in
mid-December, expanding its existing swap lines with the two countries to $30
billion each.
sooyeon@yna.co.kr
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