By Miyoung Kim and Yoo Choonsik

Asia's fourth-largest economy has looked as one of the region's most vulnerable to the credit crunch with its banks struggling to find the dollars to pay foreign loans and frightened investors hammering down the won to its lowest in over a decade.

Heads of the country's top three financial authorities told a joint news conference that on top of the guarantees worth $100 billion, they would also inject $30 billion to dollar-starved banks and exporters and help smaller firms get some 12 trillion won ($9 billion) in loans.

"The government has decided to join in global coordinated efforts to stabilize financial markets and we'll continue to provide pre-emptive, decisive and sufficient measures to this end," South Korea's Finance Minister Kang Man-soo told reporters.

"We believe providing the government guarantee on banks' foreign exchange dealings is the strongest step to save our foreign exchange reserves," Kang said.

Analysts generally praised the measures, saying they should help soothe investors and boost local markets.

"It seems the government knows what challenges they are facing and how to deal with them," said Hong Sun-young at Samsung Economic Research Institute.

"The government has sent a strong signal to market players in a panic that they will stand as lender of last resort in a crisis."

The steps come as countries around the world are scrambling to contain the fallout from a 14-month-old credit crisis and a global economic downturn which threatens to be the most serious slump since the 1930s Great Depression.

The global crisis has dried up dollars available to emerging economies and raised fears about the ability of the heavily leveraged South Korean banks to meet their external debts.

The won has lost about a third of its value against the dollar so far this year to hit its lowest level since the Asian financial crisis 11 years ago, and foreign investors have sold off a record 30 trillion won of local shares.

The government said it would inject 1 trillion won worth of securities held by the government into Industrial Bank of Korea <024110.KS>, which could allow the bank to offer some 12 trillion won in fresh loans to customers.

The north Asian country said it was not considering injecting public funds to take stakes in domestic banks for now, but said it could take such steps and offer deposit guarantees if necessary.

It said the government guarantee on domestic banks' foreign exchange deals with international banks will be in place until June next year.

(Editing by Jonathan Thatcher and Tomasz Janowski)