Hyundai Mobis Backs Suppliers With 500 Billion Won Loan Guarantee Program

Hyundai Mobis is launching a 500 billion won ($360 million) loan guarantee program with Hana Bank and the Korea Technology Finance Corporation to help its suppliers secure funding and support shared growth.

Hyundai Mobis (012330) said on the 28th that it signed a shared-growth guarantee agreement with Hana Bank and the Korea Technology Finance Corporation at its headquarters in Yeoksam-dong, Seoul, on the 27th to provide financial support to suppliers.

The signing ceremony was attended by Hyundai Mobis President Lee Kyu-suk, Hana Bank President Lee Ho-sung and Korea Technology Finance Corporation Chairman Kwon Hyung-taek.

The agreement targets small and mid-sized suppliers that struggle to raise funds because of low credit ratings or insufficient collateral despite strong technology and growth potential. Under the deal, Hyundai Mobis and Hana Bank will contribute a combined 30 billion won, which the Korea Technology Finance Corporation will use to create a 500 billion won loan guarantee ceiling to help suppliers borrow from commercial banks.

The program screens applicants primarily on their technology and business viability rather than financial metrics. Small suppliers that previously had difficulty accessing bank loans can borrow from Hana Bank at preferential rates of 3.9% to 4.9% a year, backed by guarantees from the Korea Technology Finance Corporation. The program takes effect in September.

Hyundai Mobis expects the measures to lower suppliers' financing costs and free up liquidity for research and development and production facility investment. The company also expects the program to help build out its supplier ecosystem in future growth areas such as robotics and semiconductors.

"This shared-growth guarantee program was created to support suppliers that have secured strong technology but have struggled to find growth opportunities because of financing conditions," Lee said. "We will continue to strengthen cooperation with our suppliers to raise the competitiveness of the mobility industry as a whole."