Treasury & FX in South Korea

Report date: 
8 May 2019
  • 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.
Contributors: 

This report is based on a Treasury Peer Call chaired by Simon Jones.

Countries v1: 
South Korea
Topics covered in this report: 
Intercompany loans, intercompany netting, Hedging FX, Payments - cross border, KITA certificate, CMF
Service providers discussed in this report: 
Citi, SamsungPay, FXall

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