South Korea’s Jeonbuk Bank reportedly lends to businesses against Bitcoin

what happened

Jeonbuk Bank, part of South Korea’s JB Financial Group, has reportedly begun offering won-denominated loans secured by Bitcoin (BTC) to corporate clients. Local publication EDaily reported on Monday that the lender is the first commercial bank in the country to accept the cryptocurrency as collateral. The product is restricted to businesses looking for working capital, while a specialized custodian holds the pledged BTC.

The arrangement follows amendments to South Korea’s Civil Enforcement Rules that came into force on Oct. 1. The Supreme Court said the changes set out how claims involving virtual assets can be seized and liquidated. If a borrower defaults, the bank can seek repayment through court-authorized sales.

According to EDaily, Jeonbuk Bank’s system enables recovery from cryptocurrency-sale proceeds without the lender taking direct custody of the assets. The bank has not revealed the loan size, interest rate or loan-to-value conditions. A representative told local outlet Chosun that one loan had already been granted but would not name the borrower. Cointelegraph contacted JB Financial Group for confirmation and had not received an immediate reply.

why it matters

The reported product could broaden banks’ use of crypto assets in South Korean lending, although key pricing and collateral terms remain undisclosed.

instruments