Senior officials from the government and the Grand National Party agreed at an emergency meeting that the guarantee would apply to borrowings taken out by end-June 2009, Yonhap news agency and YTN cable news channel reported.

YTN quoted a source as saying the government expects about $100 billion of borrowings would be covered by the guarantee.

The two media also said the government would inject 1 trillion won ($750 million) into Industrial Bank of Korea <024110.KS> so that the state-invested bank could expand lending to small and medium-sized enterprises.

The reports came hours before the heads of the country's top three financial authorities were due to unveil details of the measures at 12:00 p.m. on Sunday (11 p.m. EDT on Saturday).

South Korea, whose financial institutions have already faced two crises in the past decade, has looked especially vulnerable to the current global credit squeeze because of the high level of foreign debt held by its banks.

Government officials and international credit ratings agencies have repeatedly said the country's about $240 billion in foreign reserves, ranking sixth in the world, were sufficient for Asia's fourth-largest economy to avert another crisis.

But the spreading global financial crisis has dried up short-term dollar funds available to emerging-market economies and sapped confidence in South Korean financial institutions which are suffering as they roll over maturing debt.

Growing doubts about South Korea's ability to secure enough dollars to service maturing foreign debt have sent the stock market <.KS11> to its lowest level in three years and the won to the weakest in 11 years.

Yonhap and YTN also said the central bank, which has already injected billions of dollars into the local dollar/won swaps market, plans to pump more dollars into the money markets.

($1=1333.3 Won)

(Reporting by Miyoung Kim and Yoo Choonsik; Editing by Keiron Henderson)