BOK auctions off US$3 bln to local banks

SEOUL, Jan. 13 (Yonhap) -- South Korea's central bank said Tuesday it auctioned
off US$3 billion to local banks which have been suffering from a dollar liquidity
crunch in the wake of the U.S.-sparked global financial turmoil.
The Bank of Korea (BOK) said the money is part of a $30 billion currency swap
agreement which it signed with the U.S. Federal Reserve in late October. The BOK
has tapped $10.4 billion out of the swap line so far.
According to the BOK, nine financial institutions participated in the auction,
bidding for $3 billion on offer. The loans have an average annual interest rate
of 1.12 percent and will mature in 84 days.
The move came amid rising market jitters about South Korea's falling foreign
exchange reserves, the world's sixth-largest.
The country's foreign reserves totaled $201.22 billion as of the end of December,
marking the first increase in nine months as a weaker U.S. dollar boosted the
dollar value of assets in other currencies.
South Korea also reached new currency swap arrangements with China and Japan in
late December, expanding its existing swap lines with the two countries to $30
billion each.
sooyeon@yna.co.kr
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