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Korea Timeline April 23 -- In an attempt to halt the tide of corporate bankruptcies, South Korea's Ministry of Finance and Economy sets up a $1.7 billion fund to purchase the bad debts and assets of financially troubled companies. The Yonhap news agency estimates that bad commercial loans stand at $2.1 billion, or 1% of all outstanding loans. Furthermore, commercial banks carry more than $10.5 billion in loans that have not paid interest in the past six months. The Hanbo and Sammi conglomerates (chaebol) have already collapsed under $8.2 billion in bad debt. An eleventh hour attempt bails out liquor maker Jinro Group, boosting investor confidence. April 25 -- Commercial banks agree to freeze debts and offer emergency loans to ailing companies in an attempt to avoid a rash of bankruptcies. August 21 -- The Korea Institute of Finance projects that South Korea's two-year economic slump will continue until the first half of 1998. Sluggish import growth is a sign of reduced corporate investment. August 26 -- The South Korean won falls to a record low as banks and companies make a run on the dollar. Mounting bad loans and turmoil in other Asian markets prompts a flight to the relative safety of dollar-denominated assets to ensure that these companies can repay their foreign debt. August 27 -- Rumors emerge that commercial banks will reject a bailout plan established to avoid corporate bankruptcies. Some hint that the government may modify or end a plan it announced in April to purchase bad debt from commercial banks. Five of Korea's top forty conglomerates have gone bankrupt so far this year. September 21 -- Automaker Kia Group requests court mediation to protect the company from its lenders. Kia freezes debt payments and throws $10 billion more in loans into potential default, stressing the already fragile banking system in South Korea all the more. October 24 -- Multiple Asian currency crises and falling stock markets in the region further stress Korea's already battered economy, throwing stocks into turmoil as investors rush to convert shares into dollar-denominated assets.
next page -- Hong Kong Timeline
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