A Bank is a juristic person and, unless otherwise provided by law, shall only be in the form of a company limited by shares or have been established with special approval obtained prior to the amendment and enforcement of this Act.
The stock of a Bank shall be publicly issued unless otherwise approved by the Competent Authority.
The requirements for establishment of Banks or other financial institutions to be established in accordance with this Act or other laws shall be as prescribed by the Central Competent Authority.

In order to establish a Bank, the applicant(s) shall submit the following information to the Central Competent Authority for approval:
1.Type of Bank, name and type of company organization;
2.Total capital;
3.Business plan;
4.Locations of head office and branch offices; and
5.Names, native places, home addresses and curriculum vitae of each promoter and the amount of shares subscribed by each promoter.

A company which has been approved by the Competent Authority to be established in accordance with the Company Law may apply for a banking business license from the Competent Authority by submitting the following supporting documents to the Competent Authority after its capital has been fully paid-in and its company registration has been completed:
1.Certificate of company registration;
2.Statement for verification of capital;
3.Articles of Incorporation of the Bank;
4.Shareholders' roster and minutes of shareholders' meeting;
5.Directors' roster and minutes of board of directors' meeting;
6.Managing directors' roster and minutes of managing director's meeting;and
7.Supervisors' roster and minutes of supervisors' meeting.
A Bank which is not organized as a company may directly submit an application for a business license, in accordance with the preceding Paragraph, after its application for establishment is approved.

To commence business operations, a Bank shall, at its head office and branch offices, publicly announce the particulars of its business license as issued by the Central Competent Authority.

After a business license has been issued to a Bank, the Central Competent Authority may revoke the Bank's Permit if the particulars in the original application are discovered to have been materially untrue.

If a Bank wishes to establish a branch office, it shall apply to the Central Competent Authority for approval and for a business license for such branch office by submitting a business plan and specifying the proposed location of such branch office. If a Bank wishes to relocate or close a branch office, such Bank shall apply to the Central Competent Authority for approval.
A Bank wishing to establish, relocate, or close a non-business operation office or a automated service facility outside a place its business shall file an application in advance, and may establish, relocate or close such place or facility if the Central Competent Authority does not expressly reject such application within a specified period of time from the date of application. However, the Bank shall not engage in any actions applied for prior to the expiry of such specified period. Administrative rules governing the preceding 2 paragraphs shall be as stipulated by the Central Competent Authority.

Mergers of Banks or any proposed amendments to the particulars set forth in Article 53, paragraphs 1), 2) or 4) of this Act shall require the approval of the Central Competent Authority, followed by an amendment to the Bank's company registration and application for issuance of a new business license.
Public announcement of the aforesaid mergers and amendments shall be made at the Bank's head office and branch offices within fifteen (15) days after issuance of the new business license.

If a Bank violates the first Paragraph of the preceding Article, the Competent Authority may order the Bank to take corrective measures within a prescribed period of time. If such Bank fails to take such measures and the violation is serious, the Competent Authority may order the Bank to suspend operations.

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A Bank, in adopting a resolution for dissolution at a shareholders' meeting, hall state the reason for dissolution in the minutes of the said shareholders' meeting, provide a plan for the repayment of liabilities and apply to the Competent Authority, by submitting such minutes and plan, for approval before the liquidation procedure may be commenced.
The Competent Authority, in approving dissolution under the preceding paragraph, shall revoke the Permit granted to the Bank.

If there is a possibility that a Bank has violated laws and regulations, its Articles of Incorporation or disturbed the sound operation [of the financial system], the Competent Authority may, depending on the situation, take any of the following actions in addition to ordering correction or improvement by the Bank within a specified period of time:
1.Revoke resolutions of statutory meetings;
2.Suspend part of the Bank's business;
3. Restrict investments;
4.Order or prohibit the Bank from disposal or transfer of specific assets;
5.Order the Bank to close a branch or department within a prescribed period.
6.Order the Bank to discharge managers or staff members or suspend them from performance of their duties for a specified period of time;
7.Discharge directors and supervisors or suspend them from performance of their duties for a specified period of time;
8.Order the Bank to set aside a certain amount of monetary reserve;
9.Other necessary measures.
In the event that a Bank's directors or supervisors are discharged in accordance with Subparagraph 7 of the preceding Paragraph, the Competent Authority shall notify the competent authority of company registration to cancel or nullify the registration of such directors or supervisors.
If business assistance is needed in order to improve a Bank's operation defects, the Competent Authority may designate institutions to provide such assistance.

When there is a concern that a Bank is unable to pay its debts when due or there might detriment to the depositors' interests due to obvious deterioration in the Bank's business or financial status, the Competent Authority shall assign officials to take receivership over the Bank, order such a Bank to suspend and wind up business , or take other necessary measures. If deemed necessary, the Competent Authority may notify relevant authorities or institutions to prohibit the Bank's responsible person from transferring, delivering or creating other rights in his/her properties, and/or request the immigration agency to prohibit the responsible person from departing the country.
When a Bank's capital is graded as being seriously inadequate, the Competent Authority shall assign officials to take receivership over the Bank within ninety (90) days from the date the Bank is listed as having seriously inadequate capital. Notwithstanding the foregoing, for Banks that are ordered by the Competent Authority to undertake capital restructuring or merger within a prescribed period but have failed to comply therewith accordingly, the Competent Authority shall assign officials to take receivership over the Bank within ninety (90) days from the next day following the expiration of the prescribed period.
The regulations governing the procedure for receivership mentioned in the preceding two paragraphs hereof, the responsibilities and powers of the receiver, assumption of related expenses and other matters to be complied with shall be prescribed by the Competent Authority.
For Banks that are ordered to suspend business under Paragraph 1 hereof, the winding-up procedure for such Banks shall be deemed as liquidation under the Company Law.
A court that receives a Bank's filing for bankruptcy shall promptly forward a copy of the petition to the Competent Authority and consult the specific opinions of the Competent Authority on whether bankruptcy declaration should be allowed.

In the event a Bank is placed under receivership or is ordered to suspend and wind up business, the duties and powers of the Bank's shareholders' meeting, board of directors, directors, supervisors or audit committee are ipso facto suspended. The Competent Authority may notify relevant authorities or institutions to prohibit the transfer, delivery or creation of rights in the properties owned by the Bank or its responsible persons or staff members who are suspected of violating laws, and may request the immigration agency to prohibit said persons from departing the country.

Where the Competent Authority has assigned officials to take receivership over a Bank, the Bank's operation and management and disposal of the Bank's properties shall be handled by the receiver.
The receiver in the preceding paragraph has the authority to represent the Bank under receivership in litigation and non-litigation matters and may designate a natural person to discharge duties on his/her behalf. A receiver is not subject to Article 17 of the Administrative Execution Act in the performance of duties.
Upon receiving the order of receivership, the responsible person and staff members of a Bank shall deliver all books, documents, seals and properties together with an inventory thereof to the receiver and shall disclose all necessary information relating to the assets and liabilities of the Bank to the receiver and take other necessary actions to comply with such receivership as per the receiver's request; the Bank's responsible person or staff members shall not refuse to answer relevant inquiries or make false representations.
A Bank is not subject to Article 35 of Civil Code, Articles 208-1, 211, 245, and 282 ~ 314 of Company Law, or the Bankruptcy Act during receivership.
The duration of receivership over a Bank shall last two hundred and seventy (270) days from the date the Competent Authority assigns officials to take over. If deemed necessary and with the approval of the Competent Authority, the duration of receivership may be extended once for a period of no longer than one hundred and eighty (180) days.
A receiver is not required to furnish security when requesting the court for provisional seizure or provisional disposition in the performance of his or her duties.

With regards to the following actions toward a Bank under receivership, the receiver shall formulate a feasibility action plan with the approval of the Competent Authority:
1. Mandating other Banks, financial institutions or the Central Depository Insurance Company to operate all or part of the business.
2. Increasing capital, reducing capital or increasing capital after reducing capital.
3. Sale of all or part of the business, assets or liabilities.
4. Merger with another bank or another financial institution.
5. Other important actions as determined by the Competent Authority.
All necessary expenses and debts incurred by the receiver for maintaining the operations and in the performance of duties shall be borne by the Bank under receivership and repaid by the Bank's properties at any time; the types of necessary expenses and debts shall be prescribed by the Competent Authority.
Where the expenses and debts referred to in the preceding paragraph are not paid off, they shall have priorities over other debts of the Bank when the Bank under receivership is ordered by the Competent Authority to suspend and wind up business , and may be repaid at any time by the assets of the winding-up Bank .

In the event that a bank or financial institution receives the transfer of business, assets and liabilities pursuant to Subparagraph 3, Paragraph 1 of the preceding article, the following provisions shall apply:
1. For a company limited by shares, a resolution of consent to the transfer must be adopted by at least a majority of the votes of shareholders present at a shareholders' meeting attended by shareholders representing a majorityof the outstanding shares of the company, whereas dissenting shareholders may not request buy back of their shares, and Articles 185 through 188 of the Company Law do not apply.
2. Notifications of the transfer of debt may be done by a public announcement and Article 297 of the Civil Code does not apply.
3. The assumption of debt does not require the acknowledgment of creditors as provided in Article 301 of the Civil Code.
4. If the Competent Authority determines that there is a need for exigent measures , which will not have materially adverse effect on financial market competition, approval of the Fair Trade Commission under Paragraph 1, Article 11 of the Fair Trade Law is not required.
In case a Bank transfers its business, assets and liabilities pursuant to Subparagraph 3, Paragraph 1 of the preceding article, Paragraph 2, Article 5 of The Protective Act for Mass Dismissal of Employees does not apply.
In addition to Subparagraph 4 of Paragraph 1 hereof, the following provisions shall also apply when a Bank or another financial institution is merged with a Bank under receivership in accordance with Subparagraph 4 of Paragraph 1 of the preceding article:
1. For a company limited by shares, a resolution of consent to merger must be adopted by at least a majority of the votes of shareholders present at a shareholders' meeting attended by shareholders representing a majorityof outstanding shares of the company, whereas dissenting shareholders may not request buy back of their shares. For a credit cooperative, a resolution of consent to merger must be adopted by at least a majority of members (representatives) present in a members (representatives) meeting attended by at least a majority of all members (representatives), whereas dissenting members may not request refund of the amount of their shares, and Paragraphs 1 through 3 of Article 316 and Article 317 of the Company Law, and Paragraph 1 of Article 29 of the Credit Association Act shall not apply.
2. Notifications of dissolution or merger may be done by a public announcement and Paragraph 4, Article 316 of the Company Law does not apply.
Subparagraph 4 of Paragraph 1 hereof shall apply where another Bank, financial institution or the Central Depository Insurance Company is mandated to operate a Bank's business pursuant to Subparagraph 1 of Paragraph 1 of the preceding article.

For the winding-up of a Bank, the Competent Authority shall designate a liquidator to handle such proceedings and may dispatch officials to supervise the winding-up process; Paragraphs 1-3 and 6 of Article 62-2 herein shall apply to the liquidator in the performance of duties.
The duties of a rehabilitator shall be to:
1. To wind up all pending business.
2. To collect all outstanding debts and to pay off all claims .
When a liquidator discharges his or her duty pursuant to the preceding paragraph to transfer the business, assets and liabilities of a winding-up Bank to another bank or financial institution, or proposes the merger of the Bank with another bank or financial institution, the liquidator shall acquire the prior approval of the Competent Authority.
Paragraphs 1 and 3 of the preceding article shall apply where a winding-up Bank transfers its business, assets, and/or liabilities to or merges with another bank or financial institution.

After appointment of a rehabilitator, a public announcement shall be made in the daily newspapers where the Bank's head office is located requesting creditors to declare their claims within thirty (30) days and stating that claims, other than claims otherwise known to the rehabilitator, which are not declared within such specified period of time shall be excluded from the rehabilitation.
The rehabilitator shall investigate the Bank's financial conditions and prepare balance sheet and property inventories within three (3) months after the above declaration period expires, and prepare a rehabilitation plan, report same to the Competent Authority for acknowledgment and publish the Bank's balance sheet in daily newspapers where the Bank's head office is located.
During the period specified in the first paragraph, the rehabilitator shall not pay any claims other than release of trust asset or assets held as custodian and payment of staff salaries and payments made in accordance with the Deposit Insurance Act.

If a Bank is ordered by the Competent Authority to suspend and wind up business , creditors' rights shall not be exercised by any third party against the Bank other than through the winding-up proceeding set forth in Paragraph 1 of the preceding article, except for rights that have been ascertained through litigation procedures.
If the distribution of payment of creditors' rights referred to in the preceding paragraph is likely to be delayed due to litigation, the liquidator may set aside an amount based on the winding-up distribution ratio and distribute the residue assets to other creditors.
The proceedings for corporate reorganization, bankruptcy, settlement, and compulsory execution shall automatically stay during a Bank's winding-up period.
The liquidator may terminate or void any contract or agreement already entered into by the winding-up Bank but not yet being performed or fully performed. The counterparties to such contracts or agreements that sustain damages thereof may exercise their rights as creditors under the winding-up proceedings.
The following creditors' rights shall be excluded from the winding-up :
1. Interest accrued after the Bank's suspension of business.
2. Expenses incurred by creditors for personal benefit in participating in the winding-up .
3. Damages and penalties owed by the Bank due to non-performance of obligations after the Bank's suspension of business.
4. Criminal fines , administrative fines and arrears fees .
Those who hold pledges, mortgages or liens on the Bank's properties prior to the date of suspension of business shall have the right of exclusion; creditors with the right of exclusion may exercise their rights independently of the winding-up procedure; provided that for debts that remain unsettled after the exercise of right of exclusion, such creditors may file a claim in accordance with the winding-up proceeding.
Expenses and debts incurred from the performance of winding-up duties by the liquidator shall have priority over winding-up claims and may be reimbursed at any time by the assets of the Bank undergoing rehabilitation.
The statute of limitations on claims in accordance with Paragraph 1 of the preceding article or known to the liquidator and included as winding-up claims shall be interrupted and shall be reinstated from the conclusion of the winding-up proceedings.
The rights of creditors who have been repaid in the winding-up proceeding to request payment of the unpaid part of their claims shall be deemed extinguished. After completion of winding-up, if distributable property is discovered, supplemental distribution shall be carried out. If there is any residue property after paying those creditors who are listed in the winding-up proceeding, the creditors referred to in paragraph 5 shall be entitled to claim it.
After a Bank has repaid its debts according to the preceding paragraph, the remaining assets, if any, shall be distributed among the Bank's shareholders pursuant to the Company Law.

The rehabilitator shall prepare an revenue and expense statement and income statement and other relevant records for the rehabilitation period within fifteen (15) days after the rehabilitation is completed, and shall publish same in the daily newspapers where the Bank's head office is located and report same to the Competent Authority to cancel the Bank's licenses.

The expenses and debt incurred by an institution designated by the Competent Authority or its dispatched officials to provide guidance or carry out the work of conservatorship shall be borne by the Bank receiving the guidance or undergoing conservatorship.

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Article 61-1 and Article 62-1 through Article 62-9 shall apply to Banks or financial institutions established under other laws.

If the losses of a Bank exceed one third (1/3) of the Bank's capital, the Bank's directors or supervisors shall immediately report such information to the Central Competent Authority.
In the above-described circumstances, the Central Competent Authority shall require the Bank to make up such a deficit within three (3) months. If the Bank fails to do so within such a prescribed period of time, the Central Competent Authority shall send officials to take receivership over the Bank or the Bank shall be ordered to suspend its business.

If a bank or a financial organization is run poorly and there is a need to cease its operation and liquidate its debts, deposit debts shall precede non-deposit debts.
The above-mentioned deposit debts shall mean deposits stipulated in Article 12 of the Deposit Insurance Act. As for non-deposit debts, it shall mean debts other than deposit debts of the insured unit.

If a Bank is ordered to suspend its business and is instructed to take corrective measures on certain matters within a prescribed period of time, but fails to correct the matters within such prescribed period of time, the Central Competent Authority shall revoke such Bank's Permit.

If a Bank's Permit is revoked by the Central Competent Authority, such Bank shall be dissolved and liquidation procedures shall commence immediately.

If a Bank is approved for dissolution or has its Permit revoked, such Bank shall surrender and cancel its business license within a prescribed period of time. Upon failure to do so, the Central Competent Authority shall cancel the business license of such Bank by public announcement.

In supervising a special liquidation of a Bank, the court shall consult with the Competent Authority for advice and, when necessary, request the Competent Authority to recommend a liquidator or to delegate a representative to assist the liquidator in carrying out the liquidator's functions.

After a Bank has commenced liquidation, no distribution of capital or dividends shall be made under any pretense unless all of the Bank's liabilities have been settled. In the course of liquidation of a Bank, the handling of the Bank's Trust Funds and trust properties shall be dealt with in accordance with the terms of the relevant trust agreements.