S.Korea banks to roll over GM Daewoo's FX forwards

SEOUL, April 29 (Reuters) - South Korean banks will roll over expiration of half of $890 million in short-term foreign currency forwards of GM Daewoo, the South Korean unit of cash-strapped General motors Corp (GM.N), a lead creditor said on Wednesday.

"Eight banks, which have forward contracts (with GM Daewoo), have all agreed to extend the maturity for half of the transaction value which are coming due in May and June by three months," the state-run Korea Development Bank (KDB) said in a statement.

Officials at GM Daewoo Auto & Technology, South Korea's No.3 automaker, expected the roll-over would boost their short-term liquidity by up to 200 billion won ($149 million).

Last year, the company swung to a huge net loss as massive foreign exchange bets to hedge overseas sales turned sour on a weaker won and declining exports.

The firm, which sells 80 percent of its products in overseas markets including recession-hit Europe and North America under the Chevrolet, Pontiac, Holden and Suzuki brands, has seen monthly sales tumbling, due to tightened consumer spending.

GM Daewoo typically sells dollar forwards to hedge currency risks against overseas sales but plunging overseas sales since late last year forced the company to buy appreciated dollars to roll over or square off outstanding positions.

The decision came as GM Daewoo had requested additional loans from banks including KDB after exhausting a $2 billion credit line.

On Monday, its parent GM offered its final plan to reorganise outside bankruptcy by slashing bond debt, cutting over 21,000 more U.S. jobs and emerging as a nationalised automaker under majority control by the U.S. government and its major union. ($1=1345.0 Won) (Reporting by Cheon Jong-woo and Kim Yeon-hee; Editing by Jon Loades-Carter)