Korean banks in technical default8217;

WASHINGTON, Jan 13: South Korea8217;s banks are now in quot;technical defaultquot; on billions of dollars of loans that have been extended twice by international lenders, leading credit rating agency Moody8217;s investors has said. The agency said at a conference with investors that South Korea8217;s fragile financial position could quot;prolong the forced rollover periodquot;. Moody8217;s downgraded South Korea8217;s economy below investment grade to quot;junkquot; status on December 22.

quot;The rollover effort has never been as smooth as some bankers and regulators have tried to portray publicly. Many banks are not prepared to dig deeper positions in South Korea and would rather walk away from a problem that they helped createquot;, the New York Times noted. Meanwhile, house ways and means committee chairman Bill Archer and leading Republican Jack Kemp, the unsuccessful vice-presidential candidate in the last election, have joined the doubters over the IMF bailout. Asked if the Congress would approve the 18 billion President Clinton is seeking for IMF8217;snew arrangements to borrow and, Archer said on NBC-TV: quot;I think it is still an open issue.quot; Kemp said that the IMF helped cause the present mess in east Asia by encouraging devaluation. He said: quot;Asia is in a meltdown, a currency meltdown.

Stabilizing the currency is the single most important thing we can do to help them.quot;

President Clinton8217;s national security adviser, Samuel R Berger, however, supported the IMF8217;s belt-tightening requirements. quot;The most important thing that could happen,quot; he said, quot;is full compliance with those economic reform efforts.quot;