REGULATION

ON

THE COLLECTION OF CONTRIBUTIONS BY FINANCIAL INSTITUTIONS

Regulation on the Collection of Contributions by Financial Institutions

CONTENTS

§1. Purpose

§2. Classification of the Contributions

§3. Scope of Total Liabilities

§4. Rate of Contribution

§5. Rate of Issuer Contributions

§6. Payment of the Supervisory Contributions

§7. Payment and Settlement of the Issuer Contributions

§8. Return of the Contributions

§9. Accruing Interest on the Paid Contributions

§10. Specific Requirements

Addenda

Enacted on January 19, 1999

Amended on January 28, 2000

Amended on March 14, 2001 FSC 2001-12

Amended on August 1, 2001 FSC 2001-54

Amended on August 1, 2002 FSC 2002-45

Amended on March 19, 2003 FSC 2003-18

Amended on July 29, 2003 FSC 2003-38

§1. Purpose

The purpose of this Regulation is to prescribe matters necessary and pertaining to the rate of contribution, method of collection, and the return of the contributions collected by the Financial Supervisory Service (hereinafter, "the FSS") pursuant to Article 12 of the Enforcement Decree of the Act on the Establishment of Financial Supervisory Organizations (hereinafter, "the Act") and Article 90-6 of the Enforcement Decree of the Securities and Exchange Act (hereinafter, "the Exchange Act").

§2. Classification of the Contributions

The contributions collected by the FSS shall be as each of the following.

1. Contributions that must be made by the institutions subject to the examination by the FSS in accordance with Article 47 of the Act for the purposes of making operating expenses available for the FSS (hereinafter, "the supervisory contributions").

2. Contributions that must be made by the issuers submitting reporting forms (hereinafter, "the issuers") to the Financial Supervisory Commission (hereinafter, "the FSC") in accordance with Article 206-8 paragraph (1) subparagraph 2 of the Exchange Act for the purposes of making part of the contribution in making operating expenses available for the FSS (hereinafter, "issuer contributions").

§3. Scope of Total Liabilities

The total liabilities as of the end of the previous business year for the institutions subject to the examination under Article 12 paragraph (1) of the Enforcement Decree of the Act shall deduct each of the following from the balance sheet as of the end of the business year preceding the business year in which the budget for the FSS is procured (and the business year before the start of the accounting year, if the budget is not procured prior to the start of the accounting year for any reason beyond control). Trust assets shall not be included in the total liabilities, however.

1. Amount accumulated in excess of the ceiling imposed upon the reserves available for cancellation under Article 98 of the Insurance Act;

2. Provisions set aside for liabilities;

3. Won currency funds raised from divesting of the foreign currency funds to the Bank of Korea by branch offices of foreign banks in accordance with Article 26 subparagraph 4 of the Enforcement Decree of the Banking Act;

4. Liabilities acknowledged for policy or public interest purposes by the Governor of the FSS (hereinafter, "the Governor") in view of the fund raising and operation by the Korea Development Bank, the Export and Import Bank of Korea, and the Industrial Bank of Korea;

5. Liabilities determined inappropriate by the Governor for the supervisory contributions among the liabilities carried by financial institutions and originated from securities companies <Added March 14, 2001>;

6. Liabilities determined inappropriate by the Governor for the liabilities of the Non Performing Loan Resolution Fund among those carried by the Korea Asset Management Corporation and the supervisory contributions <Added March 14, 2001>; and

7. Liabilities determined inappropriate by the Governor for the supervisory contributions among the liabilities carried by the Korea Stock Exchange, the KOSDAQ, the Korea Futures Exchange, and the Korea Securities Depository <Added March 14, 2001>.

8. Liabilities among those of the KSDA that the Governor recognizes as inappropriate for being subject to the supervisory contribution.

§4. Rate of Contribution

The rate of contribution for the supervisory contributions pursuant to Article 12 paragraph (1) of the Enforcement Decree of the Act shall be as in the Annex Table.

§5. Rate of Issuer Contributions

(1) The rate of the issuer contributions pursuant to Article 90-6 paragraph (2) of the Enforcement Decree of the Act shall be as each of the following. In the event any changes are made to the total issuing value after the receipt of the securities registration (and additional documents for the registration made pursuant to the proviso of Article 8 paragraph (1) of the Exchange Act), the changed total issuing value shall provide the basis. <Amended March 19, 2003>

1. Issuance of stock certificate (including securities depository receipt; hereinafter the same) : 1.8/10000 of the total issuing value

2. For bond issuance,

a. Bonds maturing in a year or less : 5/10000 of the total issuing value;

b. Bonds maturing longer than a year but less than two years : 7/10000 of the total issuing value;

c. Bonds maturing longer than two years : 9/10000 of the total issuing value; and

d. Bonds issued solely by registration notwithstanding items a through c : 4/10000 of the total issuing value. <Amended August 1, 2001>

3. Issuance of the securities under Article 2-3 subparagraphs 6 and 7 of the Enforcement Decree of the Exchange Act : 0.9/10000 of the total issuing value. <Added March 19, 2003>

4. Issuance of the securities other than those under subparagraphs 1 through 3 : 9/10000 of the total issuing value. <Added August 1, 2001; Amended March 19, 2003>

(2) Where applicable under any of the following, the rate of contribution shall be 0/10000 of the issuer contributions, notwithstanding the provisions of paragraph (1).

1. Where stocks are newly issued to register with the Korea Securities Dealers Association;

2. Where stocks are newly issued by ailing or potentially ailing financial institutions to make contributions for the Government or the Korea Deposit Insurance Corporation pursuant to Article 12 paragraph (1) of the Act on Structural Improvement of the Financial Industry and Article 38-2 paragraph (1) of the Depositor Protection Act; and

3. Where stocks are newly issued by the person intending to acquire, merge with, or transfer businesses from ailing or potentially ailing financial institution to receive contributions from the Korea Deposit Insurance Corporation pursuant to Article 38 of the Depositor Protection Act.

§6. Payment of the Supervisory Contributions

(1) The Governor shall issue a notice detailing the amount of contribution, basis of calculation, and the payment method, among others, to each institution subject to the examination by the 15th of March every year after calculating the supervisory contributions as per each institution, unless so doing is not feasible by a budgeting delay or an event beyond control.

(2) Each institution subject to the examination shall equally divide the supervisory contributions under paragraph (1) and pay by the last day of March, May, July and October on a quarterly basis. Where the Governor provides otherwise, for instance by a budgeting delay or an event beyond control, payments may be differently arranged.

(3) In the event any of the provisions under subparagraph 4 item f of the Annex Table is applicable after the institution subject to the examination is in receipt of the notice of payment under paragraph (1), the payment applicable during the term in which the event of cause has occurred shall be exempted, and the payment made during the said term shall be returned upon request by the payer.

§7. Payment and Settlement of the Issuer Contributions

(1) The issuer shall pay the issuer contributions based upon the total issuing value referenced in the securities registration form at the time of its submission to the FSS.

(2) The Governor shall immediately return or additionally collect the issuer contributions in whole or in part after receiving the securities registration form, where any of the following is applicable. Any additional collection, however, may be deducted from the paid contributions to be returned pursuant to Article 8.

1. Where the total issuing value is changed;

2. Where a cancellation registration form is submitted; and

3. Where securities are not issued in whole or in part.

§8. Return of the Contributions

(1) The Governor shall return to the payer the contributions paid in excess of the ceiling on the contributions provided under Article 12 paragraph (2) of the Enforcement Decree of the Act and Article 90-6 paragraph (3) of the Enforcement Decree of the Exchange Act in proportion to the rate of contributions paid on an accounting year basis. The supervisory contributions, however, may be carried over to the subsequent accounting year by obtaining an approval from the FSC pursuant to Article 50 of the Act, which shall be reflected in the collection of the supervisory contributions for the subsequent year.

(2) The contributions paid in excess of the ceiling under paragraph (1) shall be returned within one month from the date of approval by the FSC for the closing of the accounting year in question.

§9. Accruing Interest on the Paid Contributions

In the event the contributions are settled or returned pursuant to Article 7 or 8, any accruing interest shall not be taken into calculation.

§10. Specific Requirements

The Governor may determine specific requirements needed to enforce this Regulation, including but without limitation, information on the rate of contribution calculation, contribution payment, and return procedures.

Addenda

§1. Enforcement Date This Regulation shall enter into force on January 1, 1999.

§2. Repeal of the Previous Regulations The FSC's "Regulation on the Securities Supervisory Board's Collection of Contributions" and the Insurance Supervisory Board's "Regulation on the Contribution of Supervisory Fees" (hereinafter, "previous Regulations") shall be repealed on the date of the enforcement of this Regulation.

§3. Applicable Cases The provisions of the Annex Table 2 shall not apply to the contributions for the accounting year in which the Futures Exchange is established with respect to the futures businesses under Article 38 paragraph (10) of the Act.

§4. Interim Measures The contributions made under the previous Regulations shall be deemed to have been made under this Regulation. All matters pertaining to the settlement and return of the contributions made under trust prior to the enforcement of this Regulation shall be governed by the previous Regulations.

Addendum

(January 28, 2000)

This Regulation shall enter into force on January 1, 2000.

Addendum

(March 14, 2001)

This Regulation shall be effective on the date of promulgation.

Addendum

(August 1, 2001)

This Regulation shall be effective on the date of promulgation. The amended provisions of Article 5 paragraph (1) subparagraph 2 item d shall be effective with the additional documents reported and submitted on and after July 7, 2001.

Addendum

(August 1, 2002)

This Regulation shall be effective on the date of promulgation.

Addendum

(March 19, 2003)

This Regulation shall be effective on the date of promulgation.

Addendum

(July 29, 2003)

This Regulation shall be effective on the date of promulgation.