(ATTN: UPDATES with more information in last 4 paras)
SEOUL, March 5 (Yonhap) -- South Korea and Indonesia on Thursday renewed their local currency swap arrangement, worth over US$9 billion, designed to help promote trade between the countries and enhance their financial stability, the Bank of Korea (BOK) said.
Under the three-year arrangement, the countries may exchange up to 10.7 trillion won ($9.02 billion), or 115 trillion Indonesian rupiah, according to the BOK.
"Similar to the previous agreement, the purpose of the bilateral local currency swap arrangement is to promote bilateral trade and financial cooperation for the economic development of the two countries," it said in a statement.
"In particular, the arrangement will ensure the settlement of trade in local currency between the two countries even in times of financial stress and thus support regional financial stability," it added.
South Korea earlier renewed its three-year bilateral currency swap deals with Australia and Malaysia, worth some $8 billion and $4 billion, respectively.
Such arrangements are largely aimed at preparing the countries against liquidity crunches by allowing them to borrow money with their own currencies.
South Korea also has currency swap arrangements with Canada and China.
Also, the country maintains the world's ninth-largest foreign exchange reserves, which stood at about $409.7 billion at the end of last month.