July 17, 2020 / 1:01 AM / 18 days ago

BOK starts lending through special purpose vehicle to stabilize local debt market

FILE PHOTO: The logo of the Bank of Korea is seen on the top of its building in Seoul, South Korea, July 14, 2016. REUTERS/Kim Hong-Ji

SEOUL (Reuters) - South Korea’s central bank on Friday said its monetary policy committee has approved a lending program to help keep credit flowing to the economy and stabilize the local debt market.

The Bank of Korea will provide financing to a special purpose vehicle that will directly purchase AA-rated and A-rated corporate debt, as well as some BBB rated commercial paper.

The loans worth up to 8 trillion won ($6.6 billion) will be made available on an as-needed basis, the BOK said in a statement.

($1 = 1,204.5100 won)

Reporting by Cynthia Kim; Editing by Shri Navaratnam

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