Policy banks zoom in on cultural contents

[THE INVESTOR] With the manufacturing sector in South Korea slowly losing steam, it is the cultural contents industry that is grabbing the attention of investors and lenders seeking to make steady profits.

Not just private investors, even the state-run policy banks are seeking to capitalize on the boom in cultural contents, ever willing to loosen their purse strings.

 

Movie posters of "Train to Busan" (left) and "Operation Chromite."

According to government estimates, the policy banks have earmarked 80 trillion won (US$72.28 billion) for creative economy, including ICT and culture contents: 49 trillion won in loans, 23 trillion won in guarantees and 8 trillion won in investments. Most of the direct investment will finance “cultural enrichment” such as dramas and movies.

Industrial Bank of Korea is planning to spend 400 billion won on culture contents this year alone. It has been an early investor in movies, drama and theater production. Its portfolio includes major box office hits such as “Roaring Currents” (2014), “Ode to My Father” (2014), “The Face Reader” (2013) and “A Violent Prosecutor” (2015) and has continued the winning streak this year with “Train to Busan” and “Operation Chromite.” 

The Export-Import Bank of Korea has lent money to produce “Descendants of the Sun” that hit the jackpot in South Korea and China, and boosted by the success decided to invest 40 billion won in a private equity fund for focuses on the promising services sector including culture contents this year.

The television drama “had induced production worth over 1 trillion won directly and indirectly and generated more than 4,500 jobs,” according to KEXIM’s overseas economy research institute.

By Hwang You-mee (glamazon@heraldcorp.com)