A financial support agreement aimed at fostering mutual growth among automotive parts suppliers in the Daegu region was held on October 17, 2019, at EXCO in Daegu.

According to the Daegu Metropolitan Government, PyungHwa Holdings, ERAE AMS, PyungHwa Precision, and Sambo Motors—together with Daegu Bank and the Daegu Metropolitan Government—agreed to jointly establish a KRW 9 billion mutual growth fund.

Companies seeking financial assistance may obtain a recommendation from one of the participating mid-sized enterprises and, following review by the Daegu Credit Guarantee Foundation, receive loans of up to KRW 500 million per company.

The Daegu Credit Guarantee Foundation will provide guarantees up to a total limit of KRW 36 billion, maintaining coverage until the guaranteed amount is fully repaid.

The loan interest rate under the mutual growth support program will be capped at the market base rate plus 1.2%, with early repayment fees waived. Repayment options include a one-year lump-sum repayment plan or a five-year structure consisting of a two-year grace period followed by three years of equal monthly principal repayments.

A Daegu city official stated, “This agreement was designed to support second- and third-tier automotive parts suppliers in the region that are experiencing financial difficulties due to sluggish exports by domestic automakers and weakening domestic demand.”