The Ministry of Environment (Minister Han Wha-jin) and Korea Environmental Industry & Technology Institute (President Choi Heung-jin) have announced that they will increase the budget for the "Green Asset Securitization Support Program" for small and medium-sized enterprises (SMEs) and middle-standing enterprises by applying the Korean Green Classification System (K-taxonomy) by more than double compared to the previous year. They will also add additional securities issuing institutions. 

Starting from 2023, the 'Green Asset-Backed Securities (ABS)' is a type of security that is issued by incorporating the K-taxonomy. It utilizes corporate bonds of SMEs and middle-standing enterprises as underlying assets to enhance creditworthiness through asset securitization.

The Ministry of Environment and the Korea Environmental Industry & Technology Institute, through an agreement with the Korean Credit Guarantee Fund, successfully issued green asset-backed securities with a total value of 155.5 billion won based on the underlying assets of 74 SMEs and middle-standing enterprises during the past year. These enterprises were able to 

reduce their average interest costs by 74 million won through the 'Green Asset Securitization Support Program'.

The Ministry of Environment has expanded this year's support budget from 6 billion won to approximately 13.7 billion won, more than double compared to the previous year. The budget will be allocated to cover interest costs

* incurred from corporate bond issuance and external review costs for assessing compliance with the K-taxonomy. 

* Support for SMEs 4%p, support for middle-standing enterprises 2%p (over 1 year)

Furthermore, in addition to the Korean Credit Guarantee Fund, the Korea Technology Finance Corporation will be added as a green ABS issuing institution. This is to expand the green investment conditions for SMEs and middle-standing enterprises that possess excellent green technologies. 

The 'Green Asset Securitization Support Program' will accept applications from January 15th to February 8th through the Ministry of Environment's website (me.go.kr) and the Korea Environmental Industry & Technology Institute's website (keiti.re.kr).

The Ministry of Environment and the Korea Environmental Industry & Technology Institute will review the financial situation and suitability of businesses for green asset securitization based on their applications. Starting from March of this year, they plan to issue a total of four rounds

* of green ABS in the first half of the year.

* New securities in first half of the year: Mar., Apr., May / Refinanced securities planned for June. Separate announcement to be made on the application period starting from April issuance.

Jang Ki-bok, the Director of the Green Transition Policy Bureau at the Ministry of Environment, stated, "We will actively carry out support programs based on proactive actions to create a favorable environment for green investments in small and medium-sized enterprises and middle-standing enterprises."