Treasury & FX in South Korea

Treasury & FX in South Korea

Call date: 8th May 2019

This report covers treasurers from Asia and EU sharing experiences in S Korea, including: intercompany loans, FX risk management, interest on intercompany accounts, cross-border payments and multilateral netting.

This call was chaired by Simon Jones whose key takeaways appear below.

Click here for more reports on South East Asia

If you would like a copy of this report, please get in touch.

Key discussion takeaways

  • Domestic intercompany loans are complex and difficult to set up. Cross-border intercompany loans (inbound) appear to be getting easier under the CMF structure.
  • FX risk management is straightforward, participants reported no issues with dividends and cash repatriation.
  • There is debate as to whether it is possible to charge interest on intercompany accounts
  • Cross-border payment processing under the KITA certificate (for volumes > US$50 million) works well though it is advisable to administer this locally for language reasons.
  • Multilateral netting for intercompany payments  is possible but requires heavy documentation – participants settled bilaterally.

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