KDB provides Hanjin with credit line

Korea Development Bank (KDB) will offer a KRW50bn ($45m) credit line to help Hanjin Shipping unload stranded cargo, the bank, which is Hanjin’s major creditor, said on Thursday.

The credit line can be used only when all available funds from Hanjin Shipping, Korean Air Lines (KAL), Hanjin Group chairman Cho Yang-ho and a former Hanjin Shipping chairwoman meant Choi Eun-young are exhausted, KDB said.

Although the KDB credit line will take Hanjin Shipping’s accounts receivables as collateral – as does the KAL loan – it will have a higher priority than the KAL loan, KDB said. It also pointed out that the funds were a stopgap to help pay for the unloading of cargo, rather than to support Hanjin Shipping as a company.

KDB’s credit line bringsHanjin Shipping’s unloading funds to around KRW200bn, still short of the KRW270bn that Hanjin estimates it needs to clear all the cargo, a Seoul Central District Court judge said on Thursday.