**Exhibit 1.1**

 

**ARTICLESOF INCORPORATION**

 

**CHAPTER I**

 

**GENERAL PROVISIONS**

 

**Article 1 (Corporate Name)**

 

The name of this bank shall be “*Chusik Hoesa**KookminBank*” (the “Bank”). 

 

**Article 2 (Objective)**

 

The objective of the Bank shall be to engage in thefollowing business activities: 

 

(1) Thebanking business as prescribed by the Bank Act; and 

 

(2) The other business permitted by the Bank Act or other Korean laws. 

 

**Article 3 (Financial Support)**

 

(1) Pursuant to Article 2 (1), the Bank shall exert its efforts to improve the financial status of citizens and small and medium sized companies of Korea by providing them with financial facilities. 

 

(2) The Won currency loans (including housing loans)provided to the citizens and small and medium sized companies of Korea pursuant to Paragraph (1) above shall not be less than 60/100 of the total amount of Won currency loans provided by the Bank. 

 

(3) The small and medium sized companies referred to inParagraph (1) above shall be those defined under the Basic Act on Small and Medium Enterprises. 

 

**Article 4 (Location of Head Office and Establishment of Branches)**

 

(1) The Bank shall have its head office in Seoul. 

 

(2) The Bank may establish branches, liaison offices, representative offices or subsidiaries within oroutside Korea, as it deems necessary. 

 

**Article 5 (Method of Public Notices)**

 

Public notices of the Bank shall be made in the SeoulShinmun, a daily newspaper published in Seoul. However, if the Seoul Shinmun is not available due to circumstance beyond the Bank’s control, the public notices of the Bank shall be given in the Dong-a Ilbo. 

 

**CHAPTER II**

 

**SHARES OF STOCK**

 

**Article 6 (Total Number of Authorized Shares)**

 

The total number of shares to be issued by the Bank shall be 1,000,000,000shares. 

 

**Article 7 (Par Value per Share)**

 

The par value per share to be issued by the Bank shall be five thousand(5,000) Won. 

 

**Article 8 (Number of Shares Issued at the Time ofIncorporation)**

 

The total number of shares issued at thetime of incorporation of the Bank shall be 299,697,462 shares of common stock. 

**Article 9 (Kind of Shares and Types of Share Certificates)**

 

(1) The shares to be issued by the Bank shall be commonshares in registered form and preferred shares in registered form. The shares shall be issued by resolution of the Board of Directors. 

 

(2) The share certificates of the Bank shall be issued in the following eight (8) denominations: one (1), five (5), ten (10), fifty(50), one hundred (100), five hundred (500), one thousand (1,000) and ten thousand (10,000) shares. 

 

(3) The Bank may split or consolidate share certificates at the request of shareholders. 

 

(4) The Bank shall not issue share certificates of whole orpart of shares owned by a shareholder if such shareholder does not desire to receive share certificates corresponding to such shares. 

 

**Article 10 (Number and Description of Preferred Shares)**

 

(1) Preferred shares to be issued by the Bank shall be non-voting, and the number thereof shall not exceed one half (1/2) of the totalnumber of issued and outstanding shares. 

 

(2)The dividends on non-voting preferred shares shall be no less than one percent (1%) per annum of the par value and the rate thereof shall be determined by the Board of Directors at the time of issuance. 

 

(3) Preferred shares to be issued by the Bank may beparticipating or non- participating and accumulating or non- accumulating by the resolution of the Board of Directors. 

 

(4) If a resolution not to distribute dividends on preferred shares is adopted, then the preferred shares shall be deemed to have votingrights from the next General Meeting of Shareholders immediately following the General Meeting of Shareholders at which such resolution not to distribute dividends on preferred shares is adopted to the end of the general meeting of the shareholdersat which a resolution to distribute dividends on such preferred shares is adopted. 

 

(5) In case the Bank issues new shares by rights offerings or bonus issuance, then the type and content of new shares issued with respectto the preferred shares shall be determined by resolution of the Board of Directors. 

 

(6) Whether or not to specify the duration of preferred shares shall be determined by resolution of the Board of Directors. If there isany duration of preferred shares, such duration shall be no less than 1 year and no more than 10 years from the date of issuance, and such duration period shall be determined by the Board of Directors at the time of issuance. Preferred shares shallbe converted into the common shares upon the expiration of the duration period. However, if the holders of the preferred shares do not receive dividends entitled to them during the duration period, then the duration period shall be extended untilsuch holders receive dividends entitled to them in full. In such a case, Article 14 shall apply *mutat**is**mutandis* with respect to the distribution of dividends for new shares issued upon conversion. 

 

**Article 11 (Preemptive Rights)**

 

(1) The shareholders of the Bank shall have pre-emptiverights to subscribe for new shares to be issued by the Bank in proportion to their respective shareholdings. 

 

(2) Notwithstanding the provision of Paragraph (1) above, the Bank may allocate new shares to persons other than existing shareholders ofthe Bank, in any of the following instances: 

 

1. If the Bank offers new shares or causes underwriters to underwrite new shares in accordance with the provisions of the Securities Exchange Act (the “SEA”); 

 

2. If the Bank issues new shares for its capital increase through a public offering, which has beenauthorized pursuant to resolution by the Board of Directors of the Bank in accordance with the provisions of the SEA; 

 

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3. If the Bank preferentially allocates new shares to members of the Employee StockOwnership Association in accordance with the provisions of the SEA; 

 

4. If the Bank issues new shares upon the exercise of stock options in accordance with the provisions of the SEA; 

 

5. If the Bank issues new shares for the issuance of depositary receipts (“DR”) in accordance with the provisions of the SEA;

 

6. If the Bank issues new shares for thepurpose of soliciting foreign or domestic investment pursuant to the relevant laws, where such investment is deemed to be necessary for the management or operations of the Bank; 

 

7. If the Bank preferentially allocates new shares to a third party who has provided money, loan, advancedfinancial technology or know-how to the Bank, who has been in close business cooperative relation with the Bank, or who has contributed to the management of the Bank; or 

 

8. If the Bank issues new shares due to the capital contribution by the Korean government or Korea DepositInsurance Corporation. 

 

(3) In the case ashareholder waives or loses the pre-emptive right to subscribe new shares, those shares not subscribed due to such waiver or loss of the pre-emptive right shall be disposed by a resolution of the Board of Directors. If fractional shares result fromthe allocation of new shares, such shares shall also be disposed of by a resolution of the Board of Directors. 

 

**Article 12 (Capital Increase by General Public Offering, etc.)**

 

(1) The Bank may issue new shares for its capital increase through a general public offering, to the extent not exceeding 50/100 of thetotal number of issued and outstanding shares of the Bank, pursuant to a resolution of the Board of Directors in accordance with the provisions of the SEA. 

 

(2) The Bank may issue new shares for the purpose of soliciting foreign or domestic investment pursuant to the relevant laws, to theextent not exceeding 50/100 of the total number of issued and outstanding shares of the Bank, by a resolution of the Board of Directors, where such investment is deemed to be necessary for the management or operations of the Bank. 

 

(3) In case of issuance of new shares pursuant to Paragraphs(1) and (2) above, the type and total number of shares to be issued and the issue price shall be determined by a resolution of the Board of Directors; provided that, the issue price shall be no less than the price determined in the provisions of theEnforcement Decree of the SEA. 

 

**Article 13 (Stock Options)**

 

(1) The Bank may grant stock options to its officers andemployees pursuant to the provisions of the SEA, by a special resolution of the General Meeting of Shareholders, to the extent not exceeding 15/100 of the total number of issued and outstanding shares of the Bank; provided that the Bank may grantstock options by a resolution of the Board of Directors, to the extent not exceeding one percent (1%) of the total number of issued and outstanding shares, in case of such the bank must obtain the approval of shareholders at the nearest forthcomingGeneral Meeting of Shareholders. 

 

(2) Thepersons who are entitled to receive such stock options shall be officers and employees of the Bank who have contributed, or are capable of contributing, to the management or technical innovation of the Bank, except for officers or employees in anyof the following cases: 

 

1. The LargestShareholder (as defined in the SEA) of the Bank and Specially Related Persons thereof, except for such persons who have been regarded as Specially Related Persons by becoming officers of the Bank; 

 

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2. Major Shareholders (as defined in the SEA) of the Bank, and Specially Related Personsthereof, except for such persons who have been regarded as Specially Related Persons by becoming officers of the Bank; and 

 

3. The persons who become the Major Shareholders (as defined in the SEA) of the Bank by the exercise of their stock options. 

 

(3) The shares to be issued upon the exercise of stockoptions shall be common shares or preferred shares, both of which shall be in registered form. 

 

(4) The total number of shares to be given to one (1) officer or employee pursuant to the stock option shall not exceed 1/100 of the totalnumber of shares issued and outstanding. 

 

(5)The exercise price per share for the stock option shall be determined in accordance with the relevant laws, such as the SEA, etc. This shall also apply to the case of adjustment of exercise price. 

 

(6) Stock options may be exercised within seven (7) yearscommencing from three (3) years after the date of the General Meeting of Shareholders at which a resolution to grant such stock options was adopted. 

 

(7) A stock option is exercisable by a person who has served for the Bank two (2) years or more from the date of the General Meeting ofShareholders at which a resolution to grant such stock option was adopted. If the grantee’s continuous service terminates by reason of the grantee’s death, attainment of mandatory retirement age or for reasons other than by the fault ofthe grantee within two (2) years from the said date of resolution, the option may be exercisable within the exercise period. 

 

(8) In the case of granting the stock options to the managements, the bank must impose the condition of achievement of detailedperformance for the exercise of stock options, and may postpone or cancel the exercise of stock options if such condition is not satisfied. 

 

(9) In the following instances, the Bank may, by a resolution of the Board of Directors, cancel the stock options granted to an officer oran employee: 

 

1. When the relevant officer oremployee voluntarily resigns or retires from his or her position at the Bank after receiving the stock option; 

 

2. When the relevant officer or employee inflicts material damage or losses on the Bank due to the willful misconduct or negligence ofsuch person; 

 

3. When the Bank cannot respondto the exercise of stock options due to its bankruptcy, dissolution, etc.; or 

 

4. When an Officer and/or an employee who had been granted stock options receives the dismissal advise of FSC or is dismissed by reprimand request of Governor of FSS 

 

5. When there occurs any other event for cancellation of thestock option pursuant to the stock option agreement. 

 

**Article 14 (IssuanceDate of New Shares for the Purpose of Dividends)**

 

In casethe Bank issues new shares through a rights offering, bonus issuance and/or stock dividend, the new shares shall be deemed to have been issued at the end of the fiscal year immediately prior to the fiscal year during which the new shares are issuedfor purpose of distribution of dividends for such new shares. 

 

**Article 15(Alterations to the Registry of Shareholders, etc.)**

 

Thealterations in the registry of shareholders, registration of the creation and cancellation of pledges over shares, indication of trust assets and cancellation thereof with respect to shares, issuance of share certificates, receipt of reports andother related activities shall be conducted as determined by the President. 

 

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**Article 16 (Report of Addresses, Names and Seals or Signatures of Shareholders and Others)**

 

(1) Shareholders and registered pledgees shall file theirnames, addresses or seals with the Bank. 

 

(2)Shareholders and registered pledgees who reside in a foreign country should report to the Bank appointed agents and the addresses in Korea to which notices are to be sent. 

 

(3) The same shall apply in case of any changes in the matters referred to in Paragraphs (1) and (2) above.

 

**Article 17 (Close of Shareholders’ Registry and Record Date)**

 

(1) The Bank shall suspend entries ofalteration of the shareholders’ registry from the 1st to the 31st of January of each year. 

 

(2) The shareholders registered in the shareholders’ registry as of December 31 of each fiscal year shall be entitled to exercise therights as shareholders at the Ordinary General Meeting of Shareholders convened for such fiscal year. 

 

(3) The Bank may, if necessary for convening of an Extraordinary General Meeting of Shareholders or any other necessary cases, suspend anyentry into the shareholders’ registry with respect to shareholders’ rights for a period not exceeding three (3) months as determined by a resolution of the Board of Directors, or cause the shareholders whose names appear in theshareholders’ registry on a record date set by a resolution of the Board of Directors to exercise their rights as shareholders. If the Board of Directors deems it necessary, the Bank may suspend any entry into the shareholders’ registryand set the record date at the same time. The Bank shall give at least two (2) weeks prior notice to the public. 

 

**CHAPTER III**

 

**BONDS**

 

**Article 18 (Issuance of Convertible Bonds)**

 

(1) The Bank may issue to persons otherthan existing shareholders of the Bank convertible bonds to the extent that the total face value of the bonds shall not exceed 2,500 billion Won. 

 

(2) The Board of Directors may determine that the convertible bonds referred to in Paragraph (1) may be issued on the condition thatconversion rights will be attached to only a portion of the convertible bonds. 

 

(3) The shares to be issued upon conversion shall be common shares and preferred shares. The conversion price, which shall be equal to ormore than the face value of the shares, shall be determined by the Board of Directors at the time of issuance of convertible bonds. 

 

(4) The conversion period shall commence on the date following three (3) months from the issue date of the convertible bonds and end onthe date immediately preceding the redemption date thereof. However, the conversion period may be adjusted within the above period by a resolution of the Board of Directors. 

 

(5) For the purpose of any distribution of dividends on the shares issued upon conversion and any payment ofaccrued interest on the convertible bonds, Article 14 hereof shall apply *mutatis mutandis*. 

 

**Article 19 (Bonds with Warrants)**

 

(1) The Bank may issue to persons other than existing shareholders of the Bank bonds with warrants to the extent that the total face value of the bonds shall not exceed 500 billion Won. 

 

(2) The amount of new shares which can be subscribed for bythe holders of the bonds with warrants shall be determined by the Board of Directors to the extent that the maximum amount of such new shares shall not exceed the face value of the bonds with warrants. 

 

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(3) The shares to be issued upon exercise of warrants shall be common shares andpreferred shares. The issue price, which shall be equal to or more than the face value of the shares, shall be determined by the Board of Directors at the time of issuance of bonds with warrants. 

 

(4) The warrant exercise period shall commence on the datefollowing three (3) months from the issue date of the relevant bonds and end on the date immediately preceding the redemption date thereof. However, the warrant period may be adjusted within the above period by resolution of the Board of Directors.

 

(5) For the purpose of any distribution ofdividends on the shares issued upon exercise of warrants, Article 14 hereof shall apply *mutatis mutandis*. 

 

**Article 20 (Applicable Provisions for the Issuance of Bonds)**

 

The provisions of Articles 15 and 16 hereof shall be applicable to the issuance of bonds. 

 

**CHAPTER IV**

 

**GENERAL MEETINGS OF SHAREHOLDERS**

 

**Article 21 (Convening of General Meetings of Shareholders)**

 

(1) General Meetings of Shareholders of the Bank shall be of two types: (i) Ordinary and (ii) Extraordinary. 

 

(2) The Ordinary General Meeting of Shareholders shall beheld within three (3) months after the end of each fiscal year and the Extraordinary General Meeting of Shareholders may be convened whenever deemed to be necessary. 

 

**Article 22 (Authority to Convene)**

 

(1) The President shall convene the General Meeting of Shareholders in accordance with a resolution by the Board of Directors, unlessotherwise prescribed by other laws and ordinances. 

 

(2) If the President is unable to perform his/her duties, Article 38 (2) shall apply *mutatis**mutandis*. 

 

**Article 23 (Personal or Public Notices for Convening)**

 

(1) Written notice of the General Meeting of Shareholders of the Bank shall state the date, time, place of the Meeting, the purposes forwhich the Meeting has been called, and other matters set forth in the relevant laws. The written notice shall be sent to all shareholders at least two (2) weeks prior to the date set for such Meeting. 

 

(2) The written notice of a General Meeting of Shareholdersto be given to shareholders holding one-hundredth (1/100) or less of the total issued and outstanding voting shares may be substituted by giving public notice of the convening of the General Meeting of Shareholders in the Seoul Shinmun andthe Dong-a Ilbo, which are published in the city of Seoul and at least two (2) notices are made in the said publications two (2) weeks prior to the date set for such Meeting; provided that, if the Seoul Shinmun and the Dong-a Ilbo are not availabledue to circumstances beyond the Bank’s control, the public notices shall be given in the Chosun Ilbo and the Jooang Ilbo. 

 

**Article 24 (Place of Meeting)**

 

The General Meeting of Shareholders shall be held in the city where the head office is located or any other places adjacent thereto as required.

 

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**Article 25 (Chairman of the General Meeting of Shareholders)**

 

(1) The President shall be the Chairman of the GeneralMeeting of Shareholders. 

 

(2) In the absenceof the President, Article 38 (2) shall be applied. 

 

**Article 26(Chairman’s Authority to Maintain Order)**

 

(1) The Chairman of the General Meeting of Shareholders may order persons who purposely speaks or acts in a manner to prevent or disrupt the deliberations of the General Meeting of Shareholders or who disturb the public order of the GeneralMeeting of Shareholders to stop or retract his/her remarks or to leave the place of meeting. 

 

(2) The Chairman of the General Meeting of Shareholders may restrict the length and frequency of the speech of shareholders if it isnecessary for the smooth deliberations of the General Meeting of Shareholders. 

 

**Article 27 (Voting Rights)**

 

Each shareholdershall have one (1) vote for each share he/she owns. 

 

**Article 28 (Limitationto Voting Rights of Cross-Held Shares)**

 

If the Bank or anyof its subsidiaries (as defined in the Korean Commercial Code), alone or in aggregate, hold shares exceeding one tenth (1/10) of the total number of issued and outstanding shares of another company, the shares of the Bank held by such other companyshall not have voting rights. 

 

**Article 29 (Split Voting)**

 

(1) If any shareholder who holds two (2) or more voteswishes to split his/her votes, he/she shall notify in writing the Bank of such intent and the reasons therefor no later than three (3) days before the date set for the General Meeting of Shareholders. 

 

(2) The Bank may refuse to allow the shareholder to splithis/her votes unless the shareholder acquired the shares in trust or otherwise holds the shares for and on behalf of some other person. 

 

**Article 30 (Voting by Proxy)**

 

(1) A shareholder may designate another shareholder as a proxy to exercise his/her voting rights. 

 

(2) In the case of Paragraph (1) above, the proxy holdershall file with the Bank the documents (power of attorney) evidencing the authority to act as a proxy before the General Meeting of Shareholders. 

 

**Article 31 (Exercise of Voting Right in Writing)**

 

(1) If the method of written resolution at the General Meeting of Shareholders is adopted by resolution of the Board of Directors, atwhich the convening of the General Meeting of Shareholders is determined, the shareholders may exercise their voting rights in writing without attending the meeting. 

 

(2) In case of Paragraph (1), the Bank shall send the documents and references necessary for exercise ofvoting rights, together with the convening notice. 

 

(3) If a shareholder intends to exercise his/her voting rights in writing, the shareholder shall fill in and submit to the Bank the documents referred to in Paragraph (2) one day before the date set for the General Meeting of Shareholders.

 

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**Article 32 (Method of Resolution of the General Meeting of Shareholders)**

 

Except as otherwise provided in the applicable laws and regulations, allresolutions of the General Meeting of Shareholders shall be adopted by the affirmative vote of a majority of the shareholders present; provided that such votes shall, in any event, represent not less than one fourth (1/4) of the total number ofissued and outstanding shares. 

 

**Article 33 (Minutes of the General Meetingsof Shareholders)**

 

The substance of the course of theproceedings of the General Meeting of Shareholders and the results thereof shall be recorded in the minutes and shall be preserved at the head office and branches of the Bank, after being affixed with the names and seal impressions or signatures ofthe Chairman and the Directors present. 

 

**CHAPTER V**

 

**OFFICERS AND BOARD OF DIRECTORS**

 

**Article 34 (Directors)**

 

(1) The Bank shall have not more than thirty (30) Directors. 

 

(2) The Directors shall be the Standing Directors and theNon-Executive Directors, and the number of the Standing Directors shall be less than 50/100 of the total number of Directors; provided that, if the number of **Non-Executive** Directors does not satisfy the requirement referred to herein due tothe death or resignation of **Non-Executive** Directors or any other reason, the **Non-Executive** Directors shall be elected to fill the vacancy at the first Meeting of Shareholders to be held after such occurrence so as to cause the numberof **Non-Executive** Directors to be such prescribed number. 

 

(3) The Bank shall have one (1) President and several Vice Presidents in charge from among the Standing Directors. 

 

**Article 34-2 (Qualification of Non Executive Directors)**

 

Non-Executive Directors shall have a good quality and experience to a certain degree, in the field of related study, such as finance, economics,management, law, accounts, the press and the like, and shall have a public reputation with any of the following qualifications: 

 

1. A professional manager or executive official (a qualified person who is or used to be above an executive official in KSE listedcorporations or members of KSDA, or treated as the same) 

 

2. A professor who is or used to be above in authorized colleges, or treated as the same 

 

3. A lawyer or CPA(Certified Public Accountants) with over 5-year experience 

 

4. A person who has served in finance related organizationswith over 10-year experience 

 

5. A person whois recognized by the Board of Directors as the same through 1 to 4 

 

**Article35 (Election of Director)**

 

(1) TheStanding Directors and Non-Executive Directors shall be elected at the General Meeting of Shareholders, wherein a separate resolution pertaining to the election shall be made. Non-Executive Directors shall be those who recommended by theNon-Executive Director Nomination Committee of Article 22 of the Bank Act 

 

(2) A resolution for the election of the Directors shall be adopted by the affirmative vote of a majority of the shareholders present; provided that such votes shall, in any event, represent not less than one fourth(1/4) of the total number of issued and outstanding shares. 

 

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**Article 36 (Term of Director)**

 

(1) The term of office of the Director shall be as follows. However, if the term of office expires after theend of a fiscal year but before the Ordinary General Meeting of Shareholders convened in respect of such fiscal year, the term of office shall be extended up to the close of such General Meeting of Shareholders. 

 

1. Standing Director: 3 years 

 

2. **Non-Executive** Director: 1 year 

 

(2) Unless otherwise prescribed by General Meeting ofShareholders, the term of office of the Director shall commence from the date of appointment. 

 

**Article 37 (Appointment of President, et al.)**

 

(1) The Bank may appoint the President and the Senior EVP in charge, by resolution of the Board of Directors; provided that, the Presidentshall be the person recommended by the Committee on Recommendation for President Candidates which are composed of Non-Executive Directors and shareholder representatives, and the details about composition and operation of the Committee onRecommendation for President Candidates shall be prescribed by the resolution of Board of Directors. 

 

(2) The Bank shall appoint the Chairman of the Board of Directors by resolution of the Board of Directors. 

 

**Article 38 (Duties of Directors)**

 

(1) The President shall represent the Bank and shall overseethe business operation of the Bank. 

 

(2) TheVice Presidents in charge shall assist the President and perform their respective duties as may be delegated to them by the Board of Directors. In the absence of the President, the Vice Presidents in charge shall take his or her place as thePresident in accordance with their order of priority as determined by the Board of Directors. 

 

**Article 39 (Non-Executive Director’s Obligation to Perform Duties Faithfully)**

 

The **Non-Executive** Directors shall attend the meeting of the Board of Directors at the specified date and shall perform their respective dutiesfaithfully. During his/her service period and after his/her retirement, the **Non-Executive** Directors shall not disclose the trade secret of the Bank obtained in course of his/her performance of duties. 

 

**Article 40 (Director’s Duty to Report)**

 

If any Director finds any facts which may cause substantial losses to theBank, such Director shall promptly report to the Audit Committee thereof. 

 

**Article 41 (Composition and Convening of the Meeting of Board of Directors)**

 

(1) The Board of Directors shall consist of Directors and shall resolve each following matter: 

 

1. matters relating to business objectives and performanceevaluation; 

 

2. matters relating to amendmentsof the Articles of Incorporation; 

 

3. mattersrelating to budget and accounting including salaries of directors and employees; 

 

4. matters relating to major organizational changes such as dissolution, business transfer and merger; 

 

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5. matters relating to internal control standards; or 

 

6. other matters determined by law and the Board ofDirectors regulations 

 

(2) The Meeting of theBoard of Directors shall be convened by giving notice to each Director at least three (3) days prior to the scheduled date of such Meeting. However, the said procedures may be omitted in urgent cases or with the consent thereon of all Directors.

 

(3) The Meeting of the Board of Directorsshall be convened at least once per fiscal quarter. 

 

(4) The Bank shall report the results of management for each quarter to the Ordinary Meeting of the Board of Directors. 

 

(5) The Bank shall have the Management Executive Committee to carry out the matters delegated by the Board of Directors, and mattersregarding the operation of the Management Executive Committee shall be determined by the Board of Directors. 

 

(6) The President is authorized to determine the matters regarding the appointment or dismissal of manager and establishment, movement orremoval of branch. 

 

(7) Matters to bedeliberated and resolved by the Board of Directors, and other matters regarding the convening and operation of the Board of Directors shall be determined in accordance with the “Regulations of the Board of Directors” adopted by theresolution of the Board of Directors. 

 

**Article 42 (Method of Resolution)**

 

(1) The quorum for the Board of Directorsshall be the presence of at least more than one half (1/2) of the Directors, and all resolutions of the Board of Directors shall require the affirmative votes of a majority of the Directors present at the meeting of the Board of Directors; providedthat amendment of the Articles of Incorporation, appointment of officers and other matters requiring the resolution of General Meeting of Shareholders shall be adopted by the affirmative vote of a majority of the Directors in office. 

 

(2) The Board meetings may be held by means of a videoconference or other similar arrangement whereby all or part of the Directors may participate in the meeting and vote on matters at the same time. In such case, a Director participating in the meeting by such arrangement shall be considered presentat the meeting. 

 

(3) Any Director who has aparticular interest in the matters to be resolved at the Meeting of the Board of Directors shall not be entitled to vote at such Meeting. 

 

**Article 43 (Minutes of the Meeting of Board of Directors)**

 

(1) The proceedings of a Board meeting shall be recorded in the minutes. 

 

(2) The agenda, proceedings, resolutions, dissenting director (if any) and his/her reasons for dissenting ofa Board meeting shall be recorded in the minutes which the names and seals of the Directors present at the meeting shall be affixed. 

 

**Article 44 (Committees)**

 

(1) The Bank may establish committees, such as an Operation Committee of the Board of Directors, a Business Strategy Committee, a RiskManagement Committee, a Compensation Committee, a Non-Executive Director Nomination Committee by the resolution of the Board of Directors, for the purposes of efficient operation of the Board of Directors and effective management of the Bank.

 

(2) Matters regarding composition, power,operation, etc. of each committee shall be determined by the resolution of the Board of Directors. 

 

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(3) Articles 42 and 43 shall apply *mutat**is**mutandis* with respect tothe committees. 

 

**Article 45 (Remuneration and Severance Allowance forDirectors and Audit Committees)**

 

(1) Theremuneration for the Directors shall be determined by a resolution of the General Meeting of Shareholders. 

 

(2) The payment of severance pay for the Directors shall be in accordance with the “Regulations on Retirement Allowances forDirectors”, which has been approved at the General Meeting of Shareholders. 

 

**CHAPTER VI**

 

**AUDITCOMMITTEE**

 

**Article 46 (Constitution of Audit Committee)**

 

(1) The Bank shall establish an Audit Committee insteadof an Auditor. 

 

(2) The Audit Committee of theBank shall consist of two (2) or more Non-Executive Directors and one (1) or more Standing Director(s), who are recommended by the Candidate Recommendation Committee of Article 24 of the Bank Act. The members of the Audit Committee shall be electedat the Board of Directors. 

 

(3) The Members ofthe Audit Committee shall have a certain quality and not less than one of the members of the Audit Committee shall be a professional in financial affairs pursuant to the related regulations: 

 

1. A lawyer, CPA, CIA(Certified Internal Auditors) with over5-year experience in the related business 

 

2.A person who has been a researcher in the institutions or a full-time instructor in colleges, having a master’s degree in law or economics-business with over 5-year experience 

 

3. A person who has served as a professional in accounting, internal supervision, audit, InformationTechnology (IT) and so on with over 10-year experience in finance related organizations 

 

4. A person who has served as an executive official for over 5-year, or as an employee who has a specific and practical knowledge ineconomics, business, law, accounts and the like for over 10-year in KSE listed corporations or members of KSDA 

 

5. A person who is recognized as the same through 1 to 4 by the Board of Directors or the Shareholders’ Meeting 

 

(4) Two-thirds (2/3) of the members of the Audit Committeeshall be elected from the **Non-Executive** Directors. Of the members of the Audit Committee, the members who are not **Non-Executive** Directors shall satisfy the requirements of Article 23-2 (3) of the Banking Act. 

 

(5) The member(s) of the Audit Committee who is the**Non-Executive** Director(s) shall be elected at the General Meeting of Shareholders; provided that a shareholder holding more than 3% of the Bank’s issued and outstanding shares shall not be entitled to exercise his voting rights for thatexcess portion at a General Meeting of Shareholders at which the member of the Audit Committee shall be elected. 

 

(6) In electing the member(s) who is not the **Non-Executive** Director(s), the largest shareholder who holds voting shares (includingshares held by Specially Related Persons, shares held on account of such shareholder and his/her Specially Related Persons, shares of which voting rights have been delegated to such shareholder or his/her Specially Related Persons) more than threeone hundredth (3/100) of the total voting shares of the Bank may not exercise his/her voting rights with respect to such excess shares. 

 

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(7) The Chairman of the Audit Committee shall be elected among the Non-Executivedirectors by a resolution of the Audit Committee. 

 

(8) If the number of members of the Audit Committee does not satisfy the requirement referred to Paragraph (4) due to the death or resignation of members or any other reason, the members shall be elected to fill the vacancy at the firstOrdinary General Meeting of Shareholders to be held after such occurrence so as to cause the number of members to be such prescribed number. 

 

**Article 47 (Duties of Audit Committee)**

 

(1) The Audit Committee shall audit Directors’ performance of their duties and may request business reports from any Director, orinvestigate the business and status of property of the Bank. 

 

(2) The Chairman of the Audit Committee shall inspect the matters listed in the agenda of, and documents submitted to, a General Meeting of Shareholders and the Chairman of the Audit Committee shall express his or heropinion whether there exists any event violating statutes or these Articles of Incorporation. 

 

(3) The Audit Committee may request the Board of Directors to convene the Extraordinary General Meeting of Shareholders by submittingdocuments stating the agenda and reasons for convening such meeting. 

 

(4) The Audit Committee may request business reports from any subsidiary of the Bank when it is necessary to perform its duties. In this case, if such subsidiary does not report to the Audit Committee immediately orthe Audit Committee needs to verify the contents of the reports, it may investigate the status of business and the financial condition of the subsidiary. 

 

(5) The Audit Committee shall approve the appointment of the external auditor. 

 

(6) In addition to the matters referred to in Paragraphs (1)through (5), the Audit Committee shall carry out the matters delegated by the Board of Directors. 

 

**Article 48 (Audit Committee’s Record)**

 

The Audit Committee shall record the substance and results of its audit in the Audit Committee’s record, on which the name and seal of the Audit Committee(s) who has performed such audit shall be affixed or shallbe signed by such Audit Committee. 

 

**CHAPTER VII**

 

**ACCOUNTING**

 

**Article 49 (Fiscal Year)**

 

The fiscal year of the Bank shall begin on January 1 and end on December 31of each year. 

 

**Article 50 (Preparation and Maintenance of FinancialStatements and Business Report)**

 

(1) ThePresident shall prepare the following documents to be submitted to the Ordinary General Meeting of Shareholders, together with supplementary data and business reports, and have such documents audited by the Audit Committee no later than six (6)weeks before the date of the Ordinary General Meeting of Shareholders: 

 

1. balance sheet; 

 

2. statements of profit and loss; and 

 

3. statement of appropriation of retained earnings or statement of disposition of deficit. 

 

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(2) The Audit Committee shall submit an audit report to the President no later than one(1) week before the date of the Ordinary General Meeting of Shareholders. 

 

(3) The President shall keep on file copies of the documents described in Paragraph (1) above, together with the business report and Audit Committee’s audit report thereon, at the head office of the Bank for five(5) years, and certified copies of all of such documents at the branches of the Bank for three (3) years, beginning from one (1) week before the date of the Ordinary General Meeting of Shareholders. 

 

(4) Immediately upon obtaining approval for the documentsmentioned in Paragraph (1) above from the General Meeting of Shareholders, the President shall make a public notice of the balance sheet and the opinion of an external auditor. 

 

**Article 51 (Disposal of Profits)**

 

The Bank shall dispose of the unappropriated retained earnings as of the end of each fiscal year as follows: 

 

1. earned surplus reserves; 

 

2. other statutory reserves; 

 

3. dividends; 

 

4. temporary reserves; and 

 

5. other appropriations of earned surplus. 

 

**Article 52 (Retirement of Shares)**

 

(1) The Bank may retire the shares within the scope ofprofits attributable to the shareholders by the resolution of the Board of Directors. 

 

(2) In order to retire the shares pursuant to Paragraph (1), the Board of Directors shall adopt the following resolutions: 

 

1. Types and the total number of shares to be retired;

 

2. The total amount of shares to be acquiredfor retirement; and 

 

3. Acquisition period(the acquisition period shall be before the Ordinary General Meeting of Shareholders to be held first after the resolution of such retirement). 

 

(3) In case of acquisition of shares for the purpose of retirement pursuant to Paragraph (1), the acquisition method and amount shall bedetermined in accordance with the relevant laws, such as the SEA, etc. 

 

(4) When the shares are retired pursuant to Paragraph (1), the matters referred to in each Subparagraph of Paragraph (2) and the purpose of retirement shall be reported to the Ordinary General Meeting of Shareholdersto be held first after the resolution of such retirement. 

 

**Article 53(Dividends)**

 

(1) Dividends may bedistributed in cash or stock. 

 

(2) In case thedividends are to be distributed in stock and the Bank has several classes of shares, the stock dividend distribution may be made in shares of different classes by a resolution of the General Meeting of Shareholders. 

 

(3) Dividends of Paragraph (1) above shall be paid to theshareholders registered in the Bank’s registry of shareholders or the registered pledgees as of the last day of each fiscal year. 

 

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**Article 54 (Expiration of Right to Payment of Dividends)**

 

(1) The right to payment of dividends shall extinguish byprescription if not exercised within five (5) years. 

 

(2) The dividends, of which the right has been extinguished under Paragraph (1) above shall be kept by the Bank. 

 

**ADDENDUM**

 

**Article 1 (Effective Date)**

 

These Articles of Incorporation shall become effective from October 31, 2001. 

 

**Article 2 (Succession of Property, Rights and Obligations)**

 

(1) The Bank shall generally assume any and all properties, rights and obligations under the public and private laws held by ex-Kookmin Bank and ex-H&CB (hereinafter, both banks shall be referred to as the“Dissolving Banks”). 

 

(2) Any andall acts conducted by the Articles of Incorporation of the Dissolving Banks shall be deemed as done so by these Articles of Incorporation. 

 

**Article 3 (Appointment of Directors)**

 

(1) The initial directors at the time of incorporation of the Bank shall be appointed at the General Meeting of Shareholders of theDissolving Banks approving the merger and in accordance with the merger agreement between the Dissolving Banks. 

 

(2) In case of Paragraph (1), notwithstanding the provisions of Article 36, the term of office of the **Non-Executive** Directors andStanding Members of Audit Committee shall commence from the date of registration of merger and end on the closing of the first Ordinary General Meeting of Shareholders to be held after the enforcement of these Articles of Incorporation. 

 

**Article 4 (Employment)**

 

Employees of the Dissolving Banks shall be deemed to be employed by the Bankat the merger date. In such case, with respect to the matters to be determined based on the employment date, the employment date shall commence from the date of the beginning of service for the Dissolving Bank. 

 

**Article 5 (Fiscal Year)**

 

(1) The Bank shall assume and continue to conduct the business of the Dissolving Banks. 

 

(2) The 1st fiscal year of the Bank shall include the business period of the Dissolving Banks of 2001. 

 

**ADDENDUM**

 

**Article 1 (The date of enforcement)**

 

This Article of incorporation will take effect on and after March 22nd of 2002(2002/3/22). 

 

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**ADDENDUM**

 

**Article 1 (The date of enforcement)**

 

This Article of incorporation will take effect on and after March 21st of 2003(2003/3/21). 

 

**ADDENDUM**

 

**Article 1 (The date of enforcement)**

 

This Article of incorporation will take effect on andafter March 23rd of 2004(2004/3/23). 

 

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