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KOREA DEVELOPMENT BANK ACT

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KOREA DEVELOPMENT BANK ACT

Act No. 302, Dec. 30, 1953

Amended by Act No. 873, Dec. 27, 1961

Act No. 1557, Dec. 16, 1963

Act No. 2044, Sep. 14, 1968

Act No. 2120, Jul. 28, 1969

Act No. 2734, Dec. 26, 1974

Act No. 3020, Dec. 19, 1977

Act No. 3480, Dec. 31, 1981

Act No. 4052, Dec. 31, 1988

Act No. 4864, Jan. 5, 1995

Act No. 5371, Aug. 22, 1997

Act No. 5372, Aug. 28, 1997

Act No. 5403, Aug. 30, 1997

Act No. 5505, Jan. 13, 1998

Act No. 5982, May 24, 1999

Act No. 6679, Mar. 30, 2002

Act No. 7620, Jul. 29, 2005

Act No. 8863, Feb. 29, 2008

CHAPTER GENERAL PROVISIONS

Article 1 (Purpose)

The purpose of the Korea Development Bank is the supply and manage- ment of major industrial funds to promote the industrial development and the advancement of the national economy.

[This Article Wholly Amended by Act No. 4864, Jan. 5, 1995] Article 2 (Nature)

(1) The Korea Development Bank shall be a juristic person. The Korea Development Bank shall be operated under this Act, orders issued here- under and the Korea Development Bank's articles of incorporation.

(2) The provisions of the Bank of Korea Act and the Banking Act shall not be applied to the Korea Development Bank unless otherwise provided for in this Act. Article 3 (Establishment of Head Office, Branches, Sub-branches, and Agencies)

(1) The Korea Development Bank shall have its head office in Seoul Special Metropolitan City.

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(2) The Korea Development Bank may, subject to the provisions of the Korea Development Bank's articles of incorporation, set up branches, sub- branches or agencies in such localities as are considered necessary for its operations.

Article 4 (Capital)

(1) The paid-in capital of the Korea Development Bank shall be ten tril- lion won which shall be totally invested by the Government. (2) Deleted.

(3) Deleted.

Article 5 (Articles of Incorporation)

(1) The following matters shall be provided for in the Korea Development Bank's articles of incorporation:

1. Purpose;

2. Name;

3. Location of its head office, branches, sub-branches and agencies;

4. Paid-in capital;

5. Matters concerning officers and employees;

6. Matters concerning the board of directors;

7. Matters concerning operations and the conduct thereof;

8. Matters concerning industrial finance bonds;

9. Matters concerning accounting; and

10. Method of public notice. (2) Any revision of the Korea Development Bank's articles of incorporation shall be made with the approval of the Financial Services Commission after a resolution of the board of directors. Article 6 (Registration)

(1) The Korea Development Bank shall be registered under the condi- tions as prescribed by the Presidential Decree.

(2) Matters which are to be registered under paragraph (1), shall not be set up against a third party until their registration.

Article 7 (Prohibition on Use of Similar Name)

No person other than the Korea Development Bank shall use the name "The Korea Development Bank" or any other similar name. Article 8 (Dissolution)

(1) The dissolution of the Korea Development Bank shall be separately pro- vided for in the Act.

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(2) The remaining properties of the Korea Development Bank after dissol- ution of the Korea Development Bank shall revert to the national treasury in accordance with such separate Act.

CHAPTER OFFICERS AND EMPLOYEES

Article 9 (Officers)

(1) The Korea Development Bank shall have such officers as governor, vice-governors, directors, and auditor.

(2) While there shall be one governor and one auditor, the number of vice- governors and directors shall be determined by the articles of association. [This Article Wholly Amended by Act No. 5372, Aug. 28, 1997] Article 10 (Duties of Officers)

(1) The governor shall represent the Korea Development Bank, and admin- ister and direct the operations of the Korea Development Bank. (2) The vice-governor shall, in accordance with the articles of incorpo- ration of the Korea Development Bank, assist the governor, and act in place of the governor, when the governor is unable to perform his duties for any reason. (3) The directors shall, in accordance with the articles of incorporation of the Korea Development Bank, assist the governor and the vice-governor, take partial charge of the operations of the Korea Development Bank, and act for the governor under such orders as previously designated by the gover- nor, when both the governor and the vice-governor cannot perform their duties for any reason. (4) The auditor shall audit and examine the operations and accounting of the Korea Development Bank. Article 11 (Board of Directors)

(1) The board of directors shall consist of the governor, vice-governor and directors, and decide all important matters relating to the operations of the Korea Development Bank.

(2) Meetings of the board of directors shall be called by the governor, who shall be the chairman thereof.

(3) Meetings of the board of directors shall have a quorum when a majority of the members attend, and resolutions shall be adopted by the concurrent vote of a majority of the members present.

(4) Deleted.

(5) The auditor may attend and state his opinion at the meetings of the board of directors, but he shall not have the right to vote.

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Article 12 (Appointment of Officers)

(1) The governor shall be appointed by the President on the recom- mendation of the Chairman of the Financial Services Commission. (2) The vice-governor and directors shall be appointed by the Financial Services Commission on the recommendation of the governor.

(3) The auditor shall be appointed by the Financial Services Commission.

Article 13 (Term of Office)

(1) The term of office for officers shall be three years.

(2) Any vacancy occurring in the office of the governor, vice-governor, directors and auditor shall be filled by the appointment of a new officer, who shall, notwithstanding the remainder of the term of office for his predecessor, hold office for such period as prescribed in paragraph (1).

Article 14 (Restriction on Engaging in Concurrent Business by Officers and Employees)

Neither the officers nor the employees of the Korea Development Bank shall be engaged in any business activities for profit other than their respec- tive positions in the Korea Development Bank. Neither officers nor employees may be engaged in other activities without permission of the Financial Services Commission or the governor, respectively. [This Article Wholly Amended by Act No. 2734, Dec. 26, 1974] Article 15 (Appointment of Agent)

The governor may, in accordance with the Korea Development Bank's articles of incorporation, appoint an agent or agents from among the officers or employees of the Korea Development Bank who shall be delegated with full power to act for him in connection with the operations of the Korea Development Bank in all judicial and extrajudicial matters. Article 16 (Appointment and Dismissal of Employees) The governor shall appoint and dismiss employees of the Korea Develop- ment Bank.

Article 17 (Status of Officers)

Officers of the Korea Development Bank shall be regarded as public officials in cases where the penal provisions of any Acts including the Criminal Act are applied. KOREA DEVELOPMENT BANK ACT

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CHAPTER OPERATIONS

SECTION 1 Operations

Article 18 (Operations)

In order to fulfill the purpose as prescribed in Article 1, the Korea Develop- ment Bank shall be engaged in the following operations:

1. To lend and administer funds which are to be invested in facilities of major industries: Provided, That this shall only apply to cases where the repayment period of loans exceeds one year;

2. To lend and administer funds which are necessary for the technical devel- opment of major industrial projects;

2-2. To lend funds for acquiring the stocks in order to take over or merge the existing customer corporation in relation to the recovery of claims of the Korea Development Bank;

3. To lend and administer working funds to persons falling under any of the following items:

(a) Enterprises which have been financed under subparagraphs 1 and 2 or guaranteed under subparagraphs 4 and 6;

(b) Enterprises in which the Government or the Korea Development Bank has invested;

(c) Enterprises carrying on the business type as prescribed by Ordinance of the Prime Minister, which are closely related with manufacturing business or strengthening the competitive power of manufacturing business; and

(d) Enterprises carrying on the business of up-to-date technology or up-to-date products, which are provided by the articles of in- corporation;

4. To subscribe to, accept and invest in, or guarantee debentures (includ- ing bonds issued by non-company-type juristic persons established under special Acts) issued to furnish major industrial funds (including the funds for acquiring the stocks under subparagraph 2-2), or bonds issued by public organizations;

5. To accept and invest in stocks (including subscription certificates; here- inafter the same shall apply) of juristic persons carrying out major in- dustrial projects or secure the payment of dividends thereon for a fixed period: Provided, That any acceptance of stocks shall not exceed two times the sum of the paid-in capital of the Korea Development Bank KOREA DEVELOPMENT BANK ACT

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and the reserve fund as prescribed in Article 43 (1), and the holding stocks shall be sold from time to time;

6. To guarantee the payment on or to assume debts which have been in- curred in raising the funds specified in subparagraphs 1 through 3;

7. To acquire the necessary funds by the following methods to carry out the operations provided for in subparagraphs 1 through 6: (a) Capital and reserve funds;

(b) Borrowing government funds: Provided, That debts of the Korea Development Bank due to the borrowing shall be, in the priority of performance, junior to other debts borne by the Korea Develop- ment Bank on business;

(c) Issuing industrial finance bonds, and other securities and debt certifi- cates;

(d) Receiving savings and installment deposits: Provided, That this shall apply only to cases in which savings and installment deposits are received from enterprises financed by the Korea Development Bank, the State and local governments and other persons pre- scribed by the Presidential Decree, in respect of demand deposit; (e) Borrowing of foreign capital; and

(f) Borrowing from the Bank of Korea;

7-2. To carry out foreign exchange business;

7-3. To provide such services as economic and technical feasibility studies, programming, research, analysis, appraisal, guidance and consultation on specific projects conducted at the request of the Government, public organizations or enterprises including financial institutions; and

8. To carry out other activities incidental to the operations set forth in sub- paragraphs 1 through 7-3, subject to the approval of the Financial Services Commission.

[This Article Wholly Amended by Act No. 2044, Sep. 14, 1968] Article 18-2 (Guaranty of Repayment of Foreign Loans) When the Korea Development Bank borrows money from foreign sources, the Government may guarantee the repayment of the principal and the payment of interest thereon. [This Article Newly Inserted by Act No. 2044, Sep. 14, 1968] Article 19 (Long-term Loans of Government Special Funds) Long-term loans of Government special funds with not less than one year's maturity shall be extended and administered exclusively by the Korea Development Bank.

Article 20 (Application for Approval for Operational Program) (1) The Korea Development Bank shall prepare an annual operational pro- gram each fiscal year, and submit it to the Financial Services Commission KOREA DEVELOPMENT BANK ACT

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for approval one month prior to the commencement of each fiscal year. (2) The annual operational program under paragraph (1) shall consist of the annual program of supplying industrial funds under subparagraphs 1 through 6 of Article 18 and the annual program of raising industrial funds under subparagraph 7 of Article 18, respectively.

(3) Deleted.

Article 21 (Approval of Operational Program)

The Financial Services Commission shall, upon receiving an application for approval of the operational program under Article 20 (1), approve it under the conditions as prescribed by the Presidential Decree. [This Article Wholly Amended by Act No. 4864, Jan. 5, 1995] Article 22 (Partial Revision of Operational Program) The provisions of Articles 20 and 21 shall apply mutatis mutandis to any revision of the annual operational program of the Korea Development Bank.

Article 23 Deleted. Article 24 (Service Manuals)

The Korea Development Bank shall formulate service manuals containing ways of performing services under Article 18, and obtain approval from the Financial Services Commission. This shall also apply to changes in services manuals. [This Article Wholly Amended by Act No. 5372, Aug. 28, 1997] SECTION 2 Industrial Finance Bonds

Article 25 (Issuance of Industrial Finance Bonds) (1) The Korea Development Bank shall have the exclusive right to issue industrial finance bonds.

(2) The aggregate amount of the issue of industrial finance bonds, plus the out- standing balance of debentures and bonds guaranteed by the Korea Development Bank under subparagraph 4 of Article 18, and of the debts which the Korea Development Bank has assumed, or on which the Korea Development Bank has guaranteed the payment of principal and interest under subparagraph 6 of Article 18, shall not exceed thirty times the amount of the paid-in capital of the Korea Development Bank and the reserve funds prescribed in Article 43 (1): Provided, That the following subparagraphs shall be excluded in calculating the above-stated ceiling: KOREA DEVELOPMENT BANK ACT

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1. The outstanding balance of industrial finance bonds sold to the Govern- ment;

2. The outstanding balance of industrial finance bonds on which the Government has guaranteed the payment of principal and interest; 2-2. The outstanding balance of debts guaranteed or assumed by the Korea Development Bank on which other financial institutions (including the Export-Import Bank of Korea, the Industrial Bank of Korea, and the Long-Term Credit Bank of Korea), the Credit Guarantee Fund, insur- ance companies and similar organizations have guaranteed or insured the payment;

3. The outstanding balance of debts guaranteed or accepted by the Korea Development Bank on which the Government has guaranteed the pay- ment of principal and interest; and

4. The outstanding balance of debts guaranteed or accepted by the Korea Development Bank for the Government or local government. (3) Deleted.

(4) Deleted.

Article 26 (Issuance of Bonds to Refund Accepted Bonds or to Discharge Other Obligations)

(1) The Korea Development Bank may, when necessary to refund industrial finance bonds or to discharge obligations arising from the guaranty or acceptance of debts under subparagraphs 4 and 6 of Article 18, issue in- dustrial finance bonds over the limit prescribed in Article 25 (2). (2) When the Korea Development Bank issues industrial finance bonds as provided in paragraph (1), the Korea Development Bank shall, within one month after the issuance, refund the old industrial finance bonds in an amount equal to the aggregate par value of the industrial finance bonds issued thereby or discharge the obligations in question.

Article 27 (Discount)

The industrial finance bonds may be issued on a discount basis. Article 28 (Guaranty of Payment by Government)

(1) The payment of principal and interest of industrial finance bonds may be guaranteed by the Government.

(2) If the Government desires to guarantee the redemption of principal and interest of the industrial finance bonds in accordance with paragraph KOREA DEVELOPMENT BANK ACT

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(1), it shall obtain in advance the approval of the National Assembly.

Article 29 (Extinctive Prescription of Bonds)

The right to the principal and the interest of industrial finance bonds shall be extinguished by prescription unless exercised within five years and two years, respectively.

Article 30 (Enforcement Decree)

Other necessary matters relating to industrial finance bonds not provided by this Act shall be prescribed by the Presidential Decree.

SECTION 3 Administration of Loans

Article 31 (Administration of Supplied Funds)

(1) The Korea Development Bank shall administer the funds supplied so as to be used for specified purposes and in conformity with the plans agreed upon, and take necessary steps. (2) Deleted.

[This Article Wholly Amended by Act No. 873, Dec. 27, 1961] Article 32 (Examination of Business Conditions)

The Korea Development Bank shall continuously examine the business con- ditions, the state of assets, the results of operations, the cash receipts and disbursements, and the effect of the supplied funds on the productivity of bor- rowers or the Korea Development Bank-invested enterprises. Upon examina- tion of such borrower or enterprise, the Korea Development Bank shall utilize the acquired information for its administration.

[This Article Wholly Amended by Act No. 873, Dec. 27, 1961] Article 33 (Dispatch of Employees)

(1) If it is necessary to ensure the effective use of the supplied funds and the successful attainment of the purposes for which the funds are sup- plied, the Korea Development Bank may dispatch its employees to the borrowers' enterprises or the Korea Development Bank-invested enterprises.

(2) Any employees of the Korea Development Bank dispatched under paragraph (1), shall be empowered to examine the management status and properties of such borrowers or Korea Development Bank-invested en- terprises. (3) When it is considered necessary for their administration in light of the results of the examination as prescribed in paragraph (2), the Korea KOREA DEVELOPMENT BANK ACT

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Development Bank may request such borrowers or enterprises to take cor- rective measures. (4) Such borrowers or Korea Development Bank-invested enterprises shall take necessary measures immediately after a receipt of the request under paragraph (3).

Article 34 (Demand for Whole or Partial Repayment) When any borrowers of the Korea Development Bank do not comply with the provisions of Articles 31 (1), 32 and 33, the Korea Development Bank may demand them to repay in whole or in part prior to the due date. Article 35 (Request for Information)

The Korea Development Bank may request the administrative agencies con- cerned to furnish such reference data and information as considered neces- sary for the operations of the Korea Development Bank.

Article 36 (Annual Report)

Within four months following the end of each fiscal year, the Korea Develop- ment Bank shall submit to the National Assembly an annual report out- lining its operations and the major industrial policies of the Government and analyzing its industrial financing activities during the corresponding fiscal year.

CHAPTER ACCOUNTING

Article 37 (Fiscal Year, Budget and Settlement of Accounts) (1) The fiscal year of the Korea Development Bank shall correspond to the fiscal year of the Government.

(2) The Korea Development Bank shall work out a budget of revenue and expenditure for each fiscal year and obtain approval therefor from the Financial Services Commission before the fiscal year begins. (3) The Korea Development Bank shall formulate a statement of settlement of accounts for the previous year within two months from the end of each fiscal year, and conclude the settlement of accounts through the approval of the Financial Services Commission. (4) Statements of accounts under paragraph (3) shall accompany by the following documents:

1. Financial statements and their accompanying documents; and

2. Other documents necessary for the clarification of contents of state- KOREA DEVELOPMENT BANK ACT

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ments of accounts.

(5) The Financial Services Commission shall consolidate the statements of accounts of the Korea Development Bank under paragraph (3), and sub- mit them to the Board of Audit and Inspection by June 30. (6) The Board of Audit and Inspection shall inspect the statements of accounts submitted under paragraph (5) and forward their results to the Financial Services Commission by September 30. [This Article Wholly Amended by Act No. 2734, Dec. 26, 1974] Articles 38 through 42 Deleted. Article 43 (Disposal of Profit)

(1) The Korea Development Bank shall dispose of its net profit of set- tlement after appropriating it in depreciation of assets each fiscal year in accordance with each of the following subparagraphs:

1. Not less than 40/100 of net profit shall be laid aside not later than reaching to the gross amount of capital; and

2. Remaining profit after laying aside under subparagraph 1 shall be dis- posed of by obtaining the approval of the Minister of Strategy and Finance through a resolution of the board of directors. In this case, the profit below a specific ratio shall be allotted to the investors and such ratio shall be determined by a resolution of the board of directors. (2) The reserve fund prescribed in paragraph (1) may, after offsetting the losses of the Korea Development Bank under Article 44, be capitalized under the conditions as prescribed by the Presidential Decree.

(3) The dividend under the provisions of paragraph (1) 2 may be made by cash or spot goods. Matters necessary for the spot goods dividend shall be prescribed by the Presidential Decree. 29. 2005> (4) The Minister of Strategy and Finance shall, prior to the grant of approval under paragraph (1) 2, consult with the Financial services Commission about whether the disposal of remaining profit is appro- priate or not, taking into account influence on the management sound- ness and the effective business conduct of the Korea Development Bank.

[This Article Wholly Amended by Act No. 2044, Sep. 14, 1968] Article 44 (Offset of Losses)

(1) The annual net losses of the Korea Development Bank shall be offset KOREA DEVELOPMENT BANK ACT

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each fiscal year by the reserve fund, and if the reserve fund is insufficient, the difference between losses and reserve fund shall be compensated by the Government. (2) Compensation by the Government referred to in paragraph (1) may, not- withstanding the provisions of Article 44 of the State Properties Act, be made as transfer of miscellaneous property under Article 4 (4) of the same Act.

(3) Where the Government intends to transfer the miscellaneous property under paragraph (2), it shall obtain the National Assembly's consent in advance after deliberation by the State Council and on approval by the President: Provided, That where it deems urgently necessary for the stabili- zation of the Korea Development Bank's management and financial order, the Government may obtain an ex post facto approval of the National Assembly. Article 45 (Use of Surplus Fund)

The Korea Development Bank may administer surplus funds in carrying out services in ways as prescribed by the articles of association, as long as the performance of services under Article 18 is not disturbed. [This Article Wholly Amended by Act No. 5372, Aug. 28, 1997] Article 46 (Audit of Accounting)

The settlement of the income and expenditure accounts of the Korea Development Bank shall be subject to audit by the Board of Audit and Inspection in each fiscal year.

CHAPTER SUPERVISION

Article 47 (Supervision)

The Financial Services Commission shall supervise the Korea Development Bank in accordance with this Act and may issue an order necessary therefor. The Financial Services Commission shall supervise the Korea Development Bank to ensure the soundness of its management in accord- ance with the Presidential Decree and may issue an order necessary therefor.

[This Article Wholly Amended by Act No. 8863, Feb. 29, 2008] Article 48 (Reasons for Dismissal of Officers)

(1) The President shall dismiss the governor of the Korea Development Bank on the recommendation of the Chairman of the Financial Services Commission in a case falling under any of the following subparagraphs: KOREA DEVELOPMENT BANK ACT

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1. In case he has violated this Act, orders issued hereunder or the ar- ticles of incorporation of the Korea Development Bank;

2. In case he has been convicted in a criminal case;

3. In case he has been declared bankruptcy; and

4. In case he is unable to perform his duties due to a mental or physical disorder.

(2) The Financial Services Commission shall dismiss the vice-governor or any of the directors of the Korea Development Bank upon the proposal of the governor of the Korea Development Bank in case they fall under any subparagraphs of paragraph (1). (3) The Financial Services Commission shall dismiss the auditor of the Korea Development Bank if he falls under any of subparagraphs of paragraph (1). Article 49 (Submission of Reports and Inspection of Documents) (1) The Financial Services Commission may, if it is deemed necessary to excercise supervision under Article 47, request the Korea Development Bank to submit reports, or have public officials of the Financial Services Commission or employees of the Financial Supervisory Service inspect the state of performance of services, books, documents, or other necessary objects of the Korea Development Bank.

(2) The Financial Services Commission may, if necessary, delegate the power of examination under paragraph (1) to the Governor of the Financial Supervisory Service.

(3) Individuals who conduct the examination of the Korea Development Bank under paragraphs (1) and (2), shall carry with them identification cards certifying their status and show the cards to the parties concerned.

Article 50 Deleted. CHAPTER SUPPLEMENTARY PROVISIONS

Article 51 Deleted. Article 52 (Restriction on Ownership, Administration or Utilization of Movable Estate and Real Estate)

The Korea Development Bank shall not own, administer or operate any real estate or movable estate except for such property as acquired for the KOREA DEVELOPMENT BANK ACT

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conduct of its business or taken over in the course of its credit collections or considered necessary for the conduct of its operations. [This Article Wholly Amended by Act No. 873, Dec. 27, 1961] Article 53 (Application of Bank of Korea Act, etc.) The Korea Development Bank shall be deemed to be included in the financial institutions as provided in the relevant respective Articles, in the application of the provisions of subparagraph 12 of Article 28 of the Bank of Korea Act, Articles 54 through 67, 87 and 88 of the same Act, and Articles 30 (1) and (2) 1 and 36 of the Banking Act. In this case, the application of Articles 87 and 88 of the Bank of Korea Act shall be limited to the funds borrowed from the Bank of Korea under the pro- visions of subparagraph 7 (f) of Article 18.

[This Article Wholly Amended by Act No. 6679, Mar. 30, 2002] Article 53-2 Deleted. Article 53-3 Deleted. Article 54 (Penal Provisions)

Any person who falls under any of the following subparagraphs, shall be punished by a fine not exceeding five million won:

1. A person who violates the provisions of Article 7; and

2. A person who violates the order issued under Article 47. [This Article Wholly Amended by Act No. 4864, Jan. 5, 1995] Article 54-2 (Special Cases to Investment under Special Act) (1) Where all or not less than one half of the capital of any juristic per- son established under a special Act is, under the provisions of such Act, to be subscribed to by the Government, or where one half or more of its issued stocks are to be held by the Government, the Korea Development Bank may, notwithstanding any provision of such Act, subscribe to the capital of such juristic person or hold its stocks in place of the Government. (2) The juristic persons, whose capital has been subscribed to by the Korea Development Bank or whose stocks are held by the Korea Develop- ment Bank under paragraph (1) may, notwithstanding the provisions of the special Act concerned, pay dividends to the Korea Development Bank in proportion to the number of stocks (including subscription certificates) held by the Korea Development Bank.

[This Article Newly Inserted by Act No. 2044, Sep. 14, 1968] Article 54-3 (Fine for Negligence)

(1) Any person who fails to submit the report as prescribed in Article 49 (1), or who makes a false report, or who refuses, interferes with, or evades the KOREA DEVELOPMENT BANK ACT

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inspection as prescribed in the said paragraph, shall be punished by a fine for negligence not exceeding five million won. (2) The fine for negligence as referred to in paragraph (1) shall be levied and collected by the Financial Services Commission under the conditions as prescribed by the Presidential Decree. (3) Any person who is dissatisfied with the disposition of the fine for negli- gence under paragraph (2), may raise an objection to the Financial Services Commission within thirty days after he is informed of such disposition.

(4) If the person who is subject to the disposition of the fine for negligence under paragraph (2), has made an objection under paragraph (3), the Financial Services Commission shall notify without delay the competent court thereof, which shall, upon receiving the notification, bring the case of the fine for negligence to a trial under the Non-Contentious Case Litiga- tion Procedure Act.

(5) If no objection is made, and no fine for negligence is paid, in the period as referred to in paragraph (3), it shall be collected according to the exam- ples of the disposition on the national tax in arrears. [This Article Newly Inserted by Act No. 4864, Jan. 5, 1995] ADDENDA

Article 55

(1) The Minister of Finance and Economy shall appoint the Korea Develop- ment Bank Organization Committee which shall handle the business of the establishment of the Korea Development Bank. (2) The Committee shall draw up the articles of incorporation of the Korea Development Bank and obtain the authorization of the Minister of Finance and Economy.

(3) The Committee shall request the Government, without delay, to pay in the capital of the Korea Development Bank, when the Minister of Finance and Economy authorizes the articles of incorporation of the Korea Develop- ment Bank under paragraph (2). (4) The Korea Development Bank shall be legally established on the date on which the capital prescribed in paragraph (3), has been paid in. (5) The Committee shall, without delay, transfer its business to the governor of the Korea Development Bank when the Korea Development Bank is KOREA DEVELOPMENT BANK ACT

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established.

Article 56

The date on which the Korea Development Bank shall commence business shall be prescribed by the Presidential Decree.

Article 57

On the date on which the Korea Development Bank is established, the Korea Development Bank shall, according to the list of property and prices as agreed upon by the Minister of Finance and Economy, the president of the Industrial Promotion Bank of Korea, and the governor of the Korea Development Bank, succeed to such assets and liabilities of the Industrial Promotion Bank of Korea as considered consistent with the purpose and scope of the operations of the Korea Development Bank as provided by this Act.

Article 58

The name of the Industrial Promotion Bank of Korea on the register books and on other documents concerning such properties as succeeded to by the Korea Development Bank from the Industrial Promotion Bank of Korea, shall be regarded as having been changed into the name of the Korea Development Bank. Article 59

Other necessary matters concerning the liquidation of the Industrial Promotion Bank of Korea not provided for in this Act shall be determined by a separate Presidential Decree.

Article 60

Matters necessary for the enforcement of this Act shall be provided for by a separate Presidential Decree.

Article 61

The Industrial Promotion Bank of Korea Act shall be repealed on the date on which the Korea Development Bank is established.

Article 62

This Act shall enter into force on the date of its promulgation. ADDENDA

(1) This Act shall enter into force on the date of its promulgation. (2) On the date on which the capital of the Korea Development Bank as provided for in Article 4 is paid in, the Korea Development Bank shall maintain fifteen billion Hwan as a special reserve fund, the total amount of which KOREA DEVELOPMENT BANK ACT

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shall be supplied by the Government in accordance with a resolution of the State Council.

(3) The special reserve fund as provided in the preceding paragraph shall be appropriated exclusively to the offset of losses resulting from loans which have been extended by the Korea Development Bank prior to the enforcement of this Act, or resulting from the payment of the capital under Article 53-3 (4). ADDENDUM

This Act shall enter into force on the enforcement day of the amended Constitution which was promulgated on December 26, 1962.

ADDENDUM

This Act shall enter into force on the date of its promulgation: Provided, That the provisions relating to the auditor in Article 9 shall enter into force on the next day of the expiration date of the term of office of the auditor currently in office. ADDENDUM

This Act shall enter into force on the date of its promulgation. ADDENDA

(1) (Enforcement Date) This Act shall enter into force on the date of its promulgation. (2) (Capitalization of Government Loan Fund) A certain amount as prescribed by the Presidential Decree out of the government loans to the Korea Development Bank outstanding at the time when this Act enters into force shall, irrespective of other Acts and subordinate statutes, be considered as having been paid in to the Korea Development Bank by the Government on the day as prescribed by the Presidential Decree.

(3) (Transitional Measures) The extinctive prescription of the right to industrial finance bonds which have been issued on or prior to December 31, 1974 shall be governed by the previous provisions.

ADDENDUM

This Act shall enter into force on the date of its promulgation. KOREA DEVELOPMENT BANK ACT

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ADDENDA

(1) (Enforcement Date) This Act shall enter into force on the date of its promulgation. (2) (Transitional Measures on Special Reserve Funds) Among special reserve funds provided for in paragraph (2) of the Addenda of the Act amending the Korea Development Bank Act (Act No. 873), the special reserve funds, which still remains unemployed after being appropriated to the offset of losses according to paragraph (3), shall be considered as subscribed to the Korea Development Bank by the Government on the date of enforcement of this Act.

ADDENDUM

This Act shall enter into force on the date of its promulgation. ADDENDA

(1) (Enforcement Date) This Act shall enter into force on the date of its promulgation. (2) (Examples of Application to Approval on Operational Program) The amended provisions of Articles 20 (3) and 21 shall apply to the operational program from 1996 onwards.

(3) (Examples of Application to Issue of Industrial Finance Bonds) The amended provisions of Article 25 (3) and (4) shall apply to the portion of the industrial finance bonds issued from 1996 onwards.

(4) (Transitional Measures concerning Penal Provisions) The application of the penal provisions to any act committed before this Act enters into force, shall be subject to the previous provisions.

ADDENDA

Article 1 (Enforcement Date)

This Act shall enter into force three months from the date of its promulgation. Articles 2 through 9 Omitted.

ADDENDA

Article 1 (Enforcement Date)

This Act shall enter into force three months from the date of its prom- KOREA DEVELOPMENT BANK ACT

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ulgation.

Article 2 (Examples of Application as to Budgets) The amended provisions of Article 37 (2) shall apply to budgets from 1998 onwards.

Article 3 (Transitional Measures as to Officers, etc.) (1) The term of office of the chairman of the board of directors and directors appointed by the Framework Act on the Management of GovernmentInvested Institutions at the time of the entry into force of this Act shall be deemed to have expired at the same time when this Act enters into force.

(2) The governor, executive officer, and auditor of the Korea Development Bank appointed by the Framework Act on the Management of Government-Invested Institutions at the time of the entry into force of this Act shall be deemed to have been appointed as governor, vice-governor, director or auditor by this Act respectively, as prescribed by articles of association. In such cases, the term of office shall be governed by the Framework Act on the Management of Government-Invested Institutions, and commences from the date on which appointment has been made.

ADDENDA

Article 1 (Enforcement Date)

This Act shall enter into force on the date of its promulgation. Articles 2 through 8 Omitted.

ADDENDA

(1) (Enforcement Date) This Act shall enter into force on April 1, 1998. (Proviso Omitted.)

(2) (Transitional Measures relating to Dispositions) At the time of the entry into force of this Act, authorization or other actions taken by administrative agencies, or various reports or other actions submitted to administrative agencies under the previous provisions, shall be deemed to be actions taken by or submitted to administrative agencies under this Act.

(3) and (4) Omitted.

(5) (Transitional Measures on Funds Granted by Government) The Amendment to subparagraph 7 (b) of Article 18 of the Korea Development Bank Act shall apply to the funds which the Government has granted to the Korea Development Bank at the time of the entry into force of this Act.

KOREA DEVELOPMENT BANK ACT

20

ADDENDA

Article 1 (Enforcement Date)

This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)

Articles 2 through 6 Omitted.

ADDENDUM

This Act shall enter into force on the date of its promulgation. ADDENDUM

This Act shall enter into force on January 1, 2006. ADDENDA

Article 1 (Enforcement Date)

This Act shall enter into force on the date of its promulgation. Articles 2 through 5 Omitted.