# EDGAR Filing Document

**Accession Number:** 0000869318
**File Stem:** 0001193125-25-197667
**Filing Date:** 2025-9
**Character Count:** 930643
**Document Hash:** cf8083c90a1f9391d6e015ff3647dbca
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-25-197667.hdr.sgml**: 20250908

**ACCESSION NUMBER**: 0001193125-25-197667

**CONFORMED SUBMISSION TYPE**: 424B5

**PUBLIC DOCUMENT COUNT**: 4

**FILED AS OF DATE**: 20250908

**DATE AS OF CHANGE**: 20250908

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** KOREA DEVELOPMENT BANK
- **CENTRAL INDEX KEY:** 0000869318
- **STANDARD INDUSTRIAL CLASSIFICATION:** FOREIGN GOVERNMENTS [8888]
- **ORGANIZATION NAME:** International Corp Fin
- **EIN:** 000000000
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 424B5
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-280021
- **FILM NUMBER:** 251298519

**BUSINESS ADDRESS:**
- **STREET 1:** 460 PARK AVE STE 443
- **CITY:** NEW YORK
- **STATE:** NY
- **ZIP:** 10022
- **BUSINESS PHONE:** 2126887686

**MAIL ADDRESS:**
- **STREET 1:** 460 PARK AVE STE 443
- **CITY:** NEW YORK
- **STATE:** NY
- **ZIP:** 10022

##### [**Table of Contents**](#toc)
**Filed Pursuant to Rule 424(b)(5) <br>Registration No. 333-280021** 

**The information in this preliminary prospectus supplement is not complete and may be changed. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. This preliminary prospectus supplement and the accompanying prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.** 

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| |
|:---|
|  **SUBJECT TO COMPLETION, DATED SEPTEMBER 8, 2025**<br>**PRELIMINARY PROSPECTUS SUPPLEMENT**<br> (To Prospectus Dated May 20, 2025) |
|  **SUBJECT TO COMPLETION, DATED SEPTEMBER 8, 2025**<br>**PRELIMINARY PROSPECTUS SUPPLEMENT**<br> (To Prospectus Dated May 20, 2025) |

---

![LOGO](g82964g01g01.jpg)

**The Korea Development Bank** 

**US$ % Notes due 2030** 

Our US$ aggregate principal amount of notes due 2030 (the "Notes") will bear interest at a rate of % per annum. Interest on the Notes is payable semi-annually in arrear on March and September of each year, beginning on March , 2026. The Notes will mature on September , 2030.

The Notes will be issued in minimum denominations of US$200,000 principal amount and integral multiples of US$1,000 in excess thereof. The Notes will be represented by one or more global securities registered in the name of a nominee of The Depository Trust Company ("DTC"), as depositary.

The payment of interest and the repayment of principal on the Notes will not be guaranteed by the Government (as defined herein).

**Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.** 

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| | | |
|:---|:---|:---|
|  | **Notes** | **Notes** |
|  | **Per Note** | **Total** |
|  Public offering price<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% |  | US$ |
|  Underwriting discounts<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% |  | US$ |
|  Proceeds to us, before expenses<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% |  | US$ |

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In addition to the initial public offering price, you will have to pay for accrued interest, if any, from and including September , 2025.

Applications will be made to the Singapore Exchange Securities Trading Limited (the "SGX-ST") for the listing and quotation of the Notes on the SGX-ST. The SGX-ST assumes no responsibility for the correctness of any of the statements made, opinions expressed or reports contained in this prospectus supplement and the accompanying prospectus. Approval in-principle from, admission to the Official List of, and listing and quotation of the Notes on, the SGX-ST are not to be taken as an indication of the merits of us or the Notes. Currently, there is no public market for the Notes. In addition, applications will be made to list the Notes on the Luxembourg Stock Exchange and to have the Notes admitted to trading on the Euro MTF Market of the Luxembourg Stock Exchange. Applications will also be made for listing of the Notes to the International Securities Market of the London Stock Exchange. No assurance can be given that such applications will be approved or that such listings will be maintained.

We expect to make delivery of the Notes to investors through the book-entry facilities of DTC on or about September , 2025.

*Joint Bookrunners and Lead Managers* 

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Citigroup** |  |  |  |  |
|  | **HSBC** |  |  |  |
|  |  | **KDB Asia** |  |  |
|  |  |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Mizuho** |  |
|  |  |  |  | **UBS** |

---

**Prospectus Supplement Dated September , 2025** 

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##### [**Table of Contents**](#toc)
You should rely only on the information contained in or incorporated by reference in this prospectus supplement and the accompanying prospectus. We have not authorized anyone to provide you with different information. We are not making an offer to sell these securities in any state or jurisdiction where the offer or sale is not permitted.

**TABLE OF CONTENTS** 

**Prospectus Supplement** 

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| | | |
|:---|:---|:---|
|  | **Page** | **Page** |
|  [Summary of the Offering](#supp82964_1) |  | S-6 |
|  [Use of Proceeds](#supp82964_2) |  | S-8 |
|  [Recent Developments](#supp82964_3) |  | S-9 |
|  [Description of the Notes](#supp82964_4) |  | S-19 |
|  [Clearance and Settlement](#supp82964_5) |  | S-21 |
|  [Taxation](#supp82964_6) |  | S-24 |
|  [Underwriting](#supp82964_7) |  | S-25 |
|  [Legal Matters](#supp82964_8) |  | S-32 |
|  [Official Statements and Documents](#supp82964_9) |  | S-32 |
|  [General Information](#supp82964_10) |  | S-32 |

---

**Prospectus** 

---

| | |
|:---|:---|
|  | **Page** |
|  [CERTAIN DEFINED TERMS AND CONVENTIONS](#toc82964_1) | 1 |
|  [USE OF PROCEEDS](#toc82964_2) | 2 |
|  [THE KOREA DEVELOPMENT BANK](#toc82964_3) | 3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Overview](#toc82964_4) | 3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Capitalization](#toc82964_5) | 5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Business](#toc82964_6) | 6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Selected Financial Statement Data](#toc82964_7) | 8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Operations](#toc82964_8) | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Sources of Funds](#toc82964_9) | 22 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Debt](#toc82964_10) | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Overseas Operations](#toc82964_11) | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Property](#toc82964_12) | 26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Directors and Management; Employees](#toc82964_13) | 26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Tables and Supplementary Information](#toc82964_14) | 27 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Financial Statements and the Auditors](#toc82964_15) | 34 |
|  [THE REPUBLIC OF KOREA](#toc82964_16) | 165 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Land and History](#toc82964_17) | 165 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Government and Politics](#toc82964_18) | 167 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [The Economy](#toc82964_19) | 170 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Principal Sectors of the Economy](#toc82964_20) | 178 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [The Financial System](#toc82964_21) | 185 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Monetary Policy](#toc82964_22) | 190 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Balance of Payments and Foreign Trade](#toc82964_23) | 194 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Government Finance](#toc82964_24) | 201 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Debt](#toc82964_25) | 204 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Tables and Supplementary Information](#toc82964_26) | 207 |

---

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##### [**Table of Contents**](#toc)

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| | |
|:---|:---|
|  | **Page** |
|  [DESCRIPTION OF THE SECURITIES](#toc82964_27) | 210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Description of Debt Securities](#toc82964_28) | 210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Description of Warrants](#toc82964_29) | 217 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Terms Applicable to Debt Securities and Warrants](#toc82964_30) | 217 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Description of Guarantees to be Issued by Us](#toc82964_31) | 218 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Description of Guarantees to be Issued by The Republic of Korea](#toc82964_32) | 219 |
|  [LIMITATIONS ON ISSUANCE OF BEARER DEBT SECURITIES AND BEARER WARRANTS](#toc82964_33) | 220 |
|  [TAXATION](#toc82964_34) | 221 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Korean Taxation](#toc82964_35) | 221 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [U.S. Federal Income Tax Considerations](#toc82964_36) | 223 |
|  [PLAN OF DISTRIBUTION](#toc82964_37) | 232 |
|  [LEGAL MATTERS](#toc82964_38) | 233 |
|  [AUTHORIZED REPRESENTATIVES IN THE UNITED STATES](#toc82964_39) | 233 |
|  [OFFICIAL STATEMENTS AND DOCUMENTS](#toc82964_40) | 233 |
|  [EXPERTS](#toc82964_41) | 233 |
|  [FORWARD-LOOKING STATEMENTS](#toc82964_42) | 234 |
|  [FURTHER INFORMATION](#toc82964_43) | 236 |

---

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##### [**Table of Contents**](#toc)
**Certain Defined Terms** 

All references to "we" or "us" mean The Korea Development Bank. All references to "Korea" or the "Republic" contained in this prospectus supplement mean The Republic of Korea. All references to the "Government" mean the government of Korea. Terms used but not defined in this prospectus supplement shall have the same meanings given to them in the accompanying prospectus.

Our separate financial information as of December 31, 2024 and June 30, 2025 and for the six months ended June 30, 2024 and 2025 included in this prospectus supplement has been prepared in accordance with International Financial Reporting Standards as adopted in Korea ("Korean IFRS" or "K-IFRS"). References in this prospectus supplement to "separate" financial statements and information are to financial statements and information prepared on a non-consolidated basis. Unless specified otherwise, our financial and other information included in this prospectus supplement is presented on a separate basis in accordance with Korean IFRS and does not include such information with respect to our subsidiaries.

In this prospectus supplement and the accompanying prospectus, where information has been provided in units of thousands, millions or billions, such amounts have been rounded up or down. Accordingly, actual numbers may differ from those contained herein due to rounding. Any discrepancy between the stated total amount and the actual sum of the itemized amounts listed in a table is due to rounding.

**Additional Information** 

The information in this prospectus supplement is in addition to the information contained in our prospectus dated May 20, 2025. The accompanying prospectus contains information regarding us and Korea, as well as a description of some terms of the Notes. You can find further information regarding us, Korea and the Notes in registration statement no. 333-280021, as amended, relating to our debt securities, with or without warrants, and guarantees, which is on file with the U.S. Securities and Exchange Commission.

**We are Responsible for the Accuracy of the Information in this Document** 

We are responsible for the accuracy of the information in this document and confirm that to the best of our knowledge we have included all facts that should be included not to mislead potential investors. The SGX-ST assumes no responsibility for the correctness of any of the statements made, opinions expressed or reports contained in this prospectus supplement and the accompanying prospectus. Approval in-principle from, admission to the Official List of, and listing and quotation of the Notes on, the SGX-ST are not to be taken as an indication of the merits of us or the Notes.

**Not an Offer if Prohibited by Law** 

The distribution of this prospectus supplement and the accompanying prospectus, and the offer of the Notes, may be legally restricted in some countries. If you wish to distribute this prospectus supplement or the accompanying prospectus, you should observe any restrictions. This prospectus supplement and the accompanying prospectus should not be considered an offer and should not be used to make an offer, in any state or country which prohibits the offering.

The Notes may not be offered or sold in Korea, directly or indirectly, or to any resident of Korea, except as permitted by Korean law. For more information, see "Underwriting—Foreign Selling Restrictions."

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##### [**Table of Contents**](#toc)
**Information Presented Accurate as of Date of Document** 

This prospectus supplement and the accompanying prospectus are the only documents on which you should rely for information about the offering. We have authorized no one to provide you with different information. You should not assume that the information in this prospectus supplement or the accompanying prospectus is accurate as of any date other than the date on the front of each document.

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##### [**Table of Contents**](#toc)
**IMPORTANT NOTICE TO PROSPECTIVE INVESTORS** 

Prospective investors should be aware that certain intermediaries in the context of this offering of the Notes, including certain Underwriters (as defined below), are "capital market intermediaries" ("CMIs") subject to Paragraph 21 of the SFC Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission of Hong Kong (the "SFC Code"). This notice to prospective investors is a summary of certain obligations the SFC Code imposes on such CMIs, which require the attention and cooperation of prospective investors. Certain CMIs may also be acting as "overall coordinators" ("OCs") for this offering and are subject to additional requirements under the SFC Code.

Prospective investors who are the directors, employees or major shareholders of The Korea Development Bank (the "Issuer"), a CMI or its group companies would be considered under the SFC Code as having an association ("Association") with the Issuer, the CMI or the relevant group company. Prospective investors associated with the Issuer or any CMI (including its group companies) should specifically disclose this when placing an order for the Notes and should disclose, at the same time, if such orders may negatively impact the price discovery process in relation to this offering. Prospective investors who do not disclose their Associations are hereby deemed not to be so associated. Where prospective investors disclose their Associations but do not disclose that such order may negatively impact the price discovery process in relation to this offering, such order is hereby deemed not to negatively impact the price discovery process in relation to this offering.

Prospective investors should ensure, and by placing an order prospective investors are deemed to confirm, that orders placed are bona fide, are not inflated and do not constitute duplicated orders (i.e., two or more corresponding or identical orders placed via two or more CMIs). If a prospective investor is an asset management arm affiliated with any Underwriter, such prospective investor should indicate when placing an order if it is for a fund or portfolio where the Underwriter or its group company has more than a 50% interest, in which case it will be classified as a "proprietary order" and subject to appropriate handling by CMIs in accordance with the SFC Code and should disclose, at the same time, if such "proprietary order" may negatively impact the price discovery process in relation to this offering. Prospective investors who do not indicate this information when placing an order are hereby deemed to confirm that their order is not a "proprietary order". If a prospective investor is otherwise affiliated with any Underwriter, such that its order may be considered to be a "proprietary order" (pursuant to the SFC Code), such prospective investor should indicate to the relevant Underwriter when placing such order. Prospective investors who do not indicate this information when placing an order are hereby deemed to confirm that their order is not a "proprietary order". Where prospective investors disclose such information but do not disclose that such "proprietary order" may negatively impact the price discovery process in relation to this offering, such "proprietary order" is hereby deemed not to negatively impact the price discovery process in relation to this offering.

Prospective investors should be aware that certain information may be disclosed by CMIs (including private banks) which is personal and/or confidential in nature to the prospective investor. By placing an order, prospective investors are deemed to have understood and consented to the collection, disclosure, use and transfer of such information by the Underwriters and/or any other third parties as may be required by the SFC Code, including to the Issuer, any OCs, relevant regulators and/or any other third parties as may be required by the SFC Code, it being understood and agreed that such information shall only be used for the purpose of complying with the SFC Code, during the bookbuilding process for this offering. Failure to provide such information may result in that order being rejected.

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##### [**Table of Contents**](#toc)
**SUMMARY OF THE OFFERING** 

*This summary highlights selected information from this prospectus supplement and the accompanying prospectus and may not contain all of the information that is important to you. To understand the terms of our Notes, you should carefully read this prospectus supplement and the accompanying prospectus.* 

**The Notes** 

We are offering US$ aggregate principal amount of % notes due September , 2030 (the "Notes").

The Notes will bear interest at a rate of % per annum, payable semi-annually in arrear on March and September of each year, beginning on March , 2026. Interest on the Notes will be computed based on a 360-day year consisting of twelve 30-day months. See "Description of the Notes—Payment of Principal and Interest."

The Notes will be issued in minimum denominations of US$200,000 principal amount and integral multiples of US$1,000 in excess thereof. The Notes will be represented by one or more global securities registered in the name of a nominee of The Depository Trust Company ("DTC"), as depositary.

The payment of interest and the repayment of principal on the Notes will not be guaranteed by the Government.

We do not have any right to redeem the Notes prior to maturity.

***Listing***

Applications will be made to the SGX-ST for the listing and quotation of the Notes on the SGX-ST. Settlement of the Notes is not conditioned on obtaining the listing. For so long as the Notes are listed on the SGX-ST and the rules of the SGX-ST so require, the Notes, if traded on the SGX-ST, will be traded in a minimum board lot size of S$200,000 (or its equivalent in foreign currencies). Accordingly, the Notes, if traded on the SGX-ST, will be traded in a minimum board lot size of US$200,000.

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##### [**Table of Contents**](#toc)
In addition, applications will be made to list the Notes on the Luxembourg Stock Exchange and to have the Notes admitted to trading on the Euro MTF Market of the Luxembourg Stock Exchange. Applications will also be made for listing of the Notes to the International Securities Market of the London Stock Exchange. No assurance can be given that such applications will be approved or that such listings will be maintained.

***Form and Settlement***

We will issue each series of the Notes in the form of one or more fully registered global notes, registered in the name of a nominee of DTC, as depositary. Except as described in the accompanying prospectus under "Description of the Securities—Description of Debt Securities—Global Securities," the global notes will not be exchangeable for Notes in definitive registered form, and will not be issued in definitive registered form. Financial institutions, acting as direct and indirect participants in DTC, will represent your beneficial interests in the global notes. These financial institutions will record the ownership and transfer of your beneficial interest through book-entry accounts. You may hold your beneficial interests in the Notes through Euroclear Bank SA/NV ("Euroclear") or Clearstream Banking, S.A. ("Clearstream") if you are a participant in such systems, or indirectly through organizations that are participants in such systems. Any secondary market trading of book-entry interests in the Notes will take place through DTC participants, including Euroclear and Clearstream. See "Clearance and Settlement—Transfers Within and Between DTC, Euroclear and Clearstream".

***Further Issues***

We may from time to time, without the consent of the holders of the Notes, create and issue additional debt securities with the same terms and conditions as either series of the Notes in all respects so that such further issue shall be consolidated and form a single series with the relevant series of the Notes. We will not issue any such additional debt securities unless such additional securities have less than a *de minimis* amount of original issue discount or such issuance would otherwise constitute a "qualified reopening" for U.S. federal income tax purposes.

***Delivery of the Notes***

We expect to make delivery of the Notes, against payment in same-day funds on or about September , 2025, which we expect will be the business day following the date of this prospectus supplement, referred to as "T+ ," for the Notes. You should note that initial trading of the Notes may be affected by the T+ settlement. See "Underwriting—Delivery of the Notes".

***Underwriting***

KDB Asia Limited, one of the underwriters, is our affiliate and has agreed to offer and sell the Notes only outside the United States to non-U.S. persons. See "Underwriting—Relationship with the Underwriters."

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##### [**Table of Contents**](#toc)
**USE OF PROCEEDS**

The net proceeds from the issue of the Notes, after deducting the underwriting discount but not estimated expenses, will be US$ . We will use the net proceeds from the sale of the Notes for our general operations, including extension of foreign currency loans and repayment of our maturing debt and other obligations.

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##### [**Table of Contents**](#toc)
**RECENT DEVELOPMENTS** 

*This section provides information that supplements the information about our bank and the Republic included under the headings corresponding to the headings below in the accompanying prospectus dated May 20, 2025. Defined terms used in this section have the meanings given to them in the accompanying prospectus. If the information in this section differs from the information in the accompanying prospectus, you should rely on the information in this section.* 

**THE KOREA DEVELOPMENT BANK** 

Unless specified otherwise, the information provided below is stated on a separate basis in accordance with Korean IFRS. Our financial information as of and for the six months ended June 30, 2024 and 2025 in this prospectus supplement is presented based on our unaudited internal management accounts.

**Overview** 

As of June 30, 2025, we had W210,888.8 billion of loans outstanding (including loans, call loans, domestic usance, bills of exchange bought, local letters of credit negotiation and loan-type suspense accounts pursuant to the applicable guidelines without adjusting for allowance for loan losses, present value discounts and deferred loan fees), W340,869.4 billion of total assets and W44,847.9 billion of total equity, compared to W212,382.5 billion of loans outstanding, W339,221.1 billion of total assets and W42,924.9 billion of total equity as of December 31, 2024. For the six months ended June 30, 2025, we recorded interest income of W5,582.3 billion, interest expense of W5,040.4 billion and net income of W1,908.4 billion, compared to W6,125.2 billion of interest income, W5,562.5 billion of interest expense and W1,673.8 billion of net income for the six months ended June 30, 2024.

In August 2025, the National Assembly passed a proposal to amend the KDB Act to increase our authorized capital from W30,000 billion to W45,000 billion and to provide statutory grounds for the establishment of an Advanced Strategic Industries Fund to support businesses in industries such as semiconductors, secondary batteries and artificial intelligence. The KDB Act, as amended, is expected to be promulgated by the President of the Republic in September 2025.

**Capitalization** 

As of June 30, 2025, our authorized capital was W30,000 billion and our capitalization was as follows:

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| | |
|:---|:---|
|  | **June 30, 2025<sup>(1)</sup>** |
|  | **(billions of Won)** |
|  | **(unaudited)** |
|  Long-term debt<sup>(2)(3)(4)</sup>: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Won currency borrowings | 4402.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Industrial finance bonds | 163354.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign currency borrowings | 5680.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total long-term debt | 173438.3 |
|  Capital: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Paid-in capital | 26925.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital surplus | 2454.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retained earnings<sup>(5)</sup> | 14834.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accumulated other comprehensive income | 634.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total capital | 44847.9 |
|  Total capitalization | 218286.2 |

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##### [**Table of Contents**](#toc)
(1) Except as disclosed in this prospectus supplement, there has been no material change in our capitalization since
June 30, 2025.

(2) Defined as debt that has a maturity at issuance of one year or more.

(3) We have translated borrowings in foreign currencies into Won at the rate of W 1,356.4 to
US$1.00, which was the market average exchange rate, as announced by the Seoul Money Brokerage Services Ltd., on June 30, 2025.

(4) As of June 30, 2025, we had confirmed acceptances and guarantees totaling W 12,113.5 billion under outstanding guarantees issued on behalf of our clients.

(5) Includes planned regulatory reserve for credit losses of W 72.6 billion as of June 30,
2025. If our allowance for credit losses is deemed insufficient for regulatory purposes, we compensate for the difference by recording a regulatory reserve for credit losses, which is shown as a separate item included in retained earnings.

**Business** 

***Government Support and Supervision***

The Government contributed W388 billion in cash in June 2025 to our capital. As of June 30, 2025, our paid-in capital was W26,925.3 billion compared to W26,316.6 billion as of December 31, 2024. The Government further contributed W206 billion and W90 billion in cash to our capital in July 2025 and September 2025, respectively.

**Selected Financial Statement Data** 

The following tables present our selected separate financial information as of December 31, 2024 and June 30, 2025 and for the six months ended June 30, 2024 and 2025, which has been derived from our unaudited internal management accounts as of June 30, 2025 and for the six months ended June 30, 2024 and 2025 prepared in accordance with Korean IFRS.

**Separate K-IFRS Financial Statement Data** 

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| | | |
|:---|:---|:---|
|  | **Six Months Ended<br>June 30,** | **Six Months Ended<br>June 30,** |
|  | **2024** | **2025** |
|  | **(billions of Won)<br>(unaudited)** | **(billions of Won)<br>(unaudited)** |
|  **Income Statement Data** |  |  |
|  Total Interest Income | 6125.2 | 5582.3 |
|  Total Interest Expenses | 5562.5 | 5040.4 |
|  Net Interest Income | 562.8 | 541.9 |
|  Operating Income | 1660.6 | 2093.3 |
|  Income before Income Tax | 2032.3 | 2581.5 |
|  Income Tax Expense | 358.5 | 673.1 |
|  Net Income | 1673.8 | 1908.4 |

---

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| | | |
|:---|:---|:---|
|  | **As of<br>December 31, 2024** | **As of<br>June 30, 2025** |
|  | **(billions of Won)<br>(unaudited)** | **(billions of Won)<br>(unaudited)** |
|  **Statements of Financial Position Data** |  |  |
|  Total Loans<sup>(1)</sup> | 212382.5 | 210888.8 |
|  Total Borrowings<sup>(2)</sup> | 266322.6 | 264478.0 |
|  Total Assets | 339221.1 | 340869.4 |
|  Total Liabilities | 296296.2 | 296021.4 |
|  Equity | 42924.9 | 44847.9 |

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(1) Gross amount, which includes loans for facility development, loans for working capital, loans for households,
inter-bank loans, private loans, off-shore loan receivables, loans borrowed from overseas financial institutions, bills bought in foreign currencies, advance payments on acceptances and guarantees and other
loans without adjusting for allowance for loan losses, present value discounts and deferred loan fees.

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(2) Total borrowings include deposits, financial liabilities measured at fair value through profit or loss,
borrowings and debentures.

*Six Months Ended June 30, 2025* 

In the first half of 2025, we had net income of W1,908.4 billion compared to net income of W1,673.8 billion in the corresponding period of 2024, on a separate K-IFRS basis. The principal factors for the increase in net income included:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a change in net gain (loss) on derivatives to a net gain of W 229.3 billion in the first half of 2025 from a net loss of W 414.4 billion in the corresponding period of 2024,
primarily due to a change in net gain (loss) on the valuation of hedging purpose derivatives to a net gain in the first half of 2025 from a net loss in the corresponding period of 2024, which in turn resulted mainly from foreign currency
fluctuations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a change in net gain (loss) on disposal of investments in subsidiaries and associates to a net gain of W 569.8 billion in the first half of 2025 from a net loss of W 7.2 billion
in the corresponding period of 2024, primarily due to the gains recognized on our partial divestment of Hanwha Ocean;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an increase in reversal of impairment loss on investments in subsidiaries and associates to W 487.1 billion in the first half of 2025 from W 374.3 billion in the corresponding
period of 2024, primarily reflecting a reversal of impairment loss recognized in connection with an increase in the value of the common shares of HMM Company Limited; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an increase in net gain on securities measured at fair value through profit or loss to W 358.6 billion in the first half of 2025 from W 246.9 billion in the corresponding period
of 2024, which was mainly due to an increase in gains on the valuation of redeemable convertible preferred shares of ABL Bio Inc. held by us.

The above factors were partially offset by the following factors:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a change in net gain (loss) on foreign currency transactions to a net loss of W 6.2 billion in the first half of 2025 from a net gain of W 571.4 billion in the corresponding
period of 2024, which was primarily due to foreign currency fluctuations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an increase in income tax expense to W 673.1 billion in the first half of 2025 from W 358.5 billion in the corresponding period of 2024, primarily due to an increase in profit
before income taxes in the first half of 2025 compared to the corresponding period of 2024, as well as the recognition of certain deferred tax expenses in the first half of 2025;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a decrease in reversal of provisions for credit losses to W 71.3 billion in the first half of 2025 from W 378.8 billion in the corresponding period of 2024, primarily due to a
change to provisions for loan loss allowances of W 152.4 billion in the first half of 2025 from a reversal of such provisions of W 69.1 billion in the corresponding period of 2024, which in turn mainly
reflected the significant reversals recorded in the first half of 2024 following improvements in the credit ratings of certain of our large borrowers, such as Hanwha Ocean, which were not repeated to the same extent in the corresponding period of
2025. ***Allowances for Loan Losses and Loans in Arrears***

As of June 30, 2025, we had established allowances of W2,943.4 billion for loan losses under Korean IFRS.

Certain of our customers have restructured loans with their creditor banks. As of June 30, 2025, we have provided loans of W590.3 billion for companies under workout, court receivership, court mediation and other restructuring procedures. As of June 30, 2025, we had established allowances of W366.2 billion for loan losses with respect to such companies. We cannot assure you that actual credit losses from the loans to these customers will not exceed the allowances established.

------

##### [**Table of Contents**](#toc)
The following table provides information on our loan loss allowances.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  |  | **As of June 30, 2025<sup>(1)</sup>** | **As of June 30, 2025<sup>(1)</sup>** | **As of June 30, 2025<sup>(1)</sup>** |
|  |  | **Loan Amount** | **Loan Loss**<br>**Allowances** | **Loan Loss**<br>**Allowances** |
|  |  | **(in billions of Won, except<br>percentages)** | **(in billions of Won, except<br>percentages)** | **(in billions of Won, except<br>percentages)** |
|  Loan Classification | Normal<sup>(2)</sup> | W209,324.8 | W | 2160.2 |
|  Loan Classification | Precautionary | 474.5 |  | 84.1 |
|  Loan Classification | Substandard | 448.4 |  | 208.8 |
|  Loan Classification | Doubtful | 196.1 |  | 130.3 |
|  Loan Classification | Expected Loss | 445.1 |  | 360.0 |
|  | &nbsp;&nbsp;&nbsp;&nbsp; Total | W210,888.8 | W | 2943.4 |

---

(1) These figures include loans for facility development, loans for working capital, loans for households,
inter-bank loans, private loans, off-shore loan receivables, loans borrowed from overseas financial institutions, bills bought in foreign currencies, advance payments on acceptances and guarantees and other
loans.

(2) Includes loans guaranteed by the Government. Under Korean IFRS, we establish loan loss allowances for all loans
including loans guaranteed by the Government.

As of June 30, 2025, our non-performing loans totaled W1,089.5 billion, representing 0.5% of our outstanding loans as of such date. Non-performing loans are defined as loans that are classified as substandard or below. On June 30, 2025, our legal reserve was W4,528.3 billion, representing 2.1% of our outstanding loans as of such date.

***Loans to Financially Troubled Companies***

We have credit exposure to a number of financially troubled Korean companies, including HMM Company Limited (formerly, Hyundai Merchant Marine Co., Ltd.), HJ Shipbuilding & Construction Co., Ltd. (formerly, Hanjin Heavy Industries & Construction Co., Ltd.), Daehan Shipbuilding Co., Ltd., K Shipbuilding Co., Ltd. (formerly, STX Offshore & Shipbuilding), GM Korea Company and Taeyoung E&C. As of June 30, 2025, our credit extended to these companies totaled W10,395.8 billion, accounting for 3.0% of our total assets as of such date.

The following table shows the changes in credit exposure (including loans, guarantees and equity investments classified as substandard or below) extended to these companies as of the dates indicated:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **As of<br>December 31,<br>2024** | **As of<br>December 31,<br>2024** | **As of<br>June 30,<br>2025** | **As of<br>June 30,<br>2025** |  |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |  |
|  HMM Company Limited | W | 6595.1 | W | 7401.4 | Increase due to a reversal of impairment loss resulting from the conversion of convertible bonds into stock |
|  HJ Shipbuilding & Construction |  | 966.8 |  | 953.0 | Decrease due to a decrease in refund guarantees |
|  Daehan Shipbuilding |  | 1067.3 |  | 827.0 | Decrease due to repayment of loans and a decrease in refund guarantees |
|  K Shipbuilding |  | 728.5 |  | 597.1 | Decrease due to a decrease in refund guarantees |
|  GM Korea Company |  | 474.7 |  | 483.5 | Increase due to a reversal of impairment loss |
|  Taeyoung E&C |  | 133.7 |  | 133.7 |  |
|  Total | W | 9966.1 | W | 10395.8 |  |

---

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##### [**Table of Contents**](#toc)
As of June 30, 2025, we established allowances of W0.2 billion for HMM Company Limited, W134.0 billion for HJ Shipbuilding & Construction, W17.7 billion for Daehan Shipbuilding, W21.3 billion for K Shipbuilding, none for GM Korea Company and W25.0 billion for Taeyoung E&C.

In the first half of 2025, we sold non-performing loans worth W187.6 billion to Hana F&I Co., Ltd.

**Debt** 

***Debt Repayment Schedule***

The following table sets out our principal repayment schedule as of June 30, 2025:

**Debt Principal Repayment Schedule<sup>(1)</sup>** 

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** |
| <br>**Currency<sup>(2)(3)</sup>** | **2025** | **2025** | **2026** | **2026** | **2027** | **2027** | **2028** | **2028** | **Thereafter** | **Thereafter** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Won | W | 44481.2 | W | 19864.0 | W | 9692.8 | W | 5111.1 | W | 7999.4 |
|  Foreign |  | 18275.2 |  | 12284.7 |  | 7973.8 |  | 5333.9 |  | 8201.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Won Equivalent | W | 62756.4 | W | 32148.7 | W | 17666.7 | W | 10444.9 | W | 16201.2 |

---

(1) Excludes bonds sold under repurchase agreements and call money.

(2) Borrowings in foreign currencies have been translated into Won at the market average exchange rates on
June 30, 2025, as announced by the Seoul Money Brokerage Services Ltd.

(3) We categorize debt with respect to which we have entered into currency swap agreements by our repayment currency
under such agreements.

**Directors and Management; Employees** 

Currently, the members of our Board of Directors are:

---

| | | |
|:---|:---|:---|
| **Position** | **Name** | **Expiration of Term** |
|  Chief Executive Officer and Chairman of the Board of Directors | —<sup>(1)</sup> |  |
|  Acting Chief Executive Officer, Chief Operating Officer and Vice Chairman of the Board of Directors | Bock Kyu Kim | March 22, 2026 |
|  Auditor | Jae Shin Kim | August 25, 2027 |
|  Independent Non-executive Directors | Hee Rak Kim | January 28, 2026 |
|  | Sun Key You | January 28, 2026 |
|  | Seung Cheol Jeon | May 1, 2027 |
|  | Seonghoon Cho | May 1, 2027 |

---

(1) Seog Hoon Kang's term as our Chief Executive Officer and Chairman of the Board of Directors ended on
June 6, 2025. As of the date of this prospectus supplement, no successor has been appointed, and as such, Bock Kyu Kim currently serves as our Acting Chief Executive Officer.

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##### [**Table of Contents**](#toc)
**THE REPUBLIC OF KOREA** 

**The Economy** 

***Gross Domestic Product***

Based on preliminary data, GDP growth in the first half of 2025 was 0.2% at chained 2020 year prices, primarily due to a 2.8% increase in exports of goods and services and a 1.2% increase in aggregate private and general government consumption expenditures, the effects of which were offset in part by a 4.0% decrease in gross domestic fixed capital formation and a 3.1% increase in imports of goods and services, each compared with the corresponding period of 2024.

**Principal Sectors of the Economy** 

***Prices, Wages and Employment***

Based on preliminary data, the inflation rate was 2.1% and the unemployment rate was 3.1% in the first half of 2025.

**The Financial System** 

***Securities Markets***

The Korea Composite Stock Price Index was 3,071.1 on June 30, 2025, 3,245.4 on July 31, 2025, 3,186.0 on August 29, 2025 and 3,205.1 on September 5, 2025.

**Monetary Policy** 

***Foreign Exchange***

The market average exchange rate between the Won and the U.S. Dollar (in Won per one U.S. Dollar) as announced by the Seoul Money Brokerage Service Ltd. was Won 1,356.4 to US$1.00 on June 30, 2025, Won 1,382.9 to US$1.00 on July 31, 2025, Won 1,388.6 to US$1.00 on August 29, 2025 and 1,392.7 to US$1.00 on September 5, 2025.

**Balance of Payments and Foreign Trade** 

***Balance of Payments***

Based on preliminary data, the Republic's current account surplus in the first half of 2025 increased to US$49.4 billion from the current account surplus of US$40.2 billion in the corresponding period of 2024, primarily due to increases in surpluses from the income account and the goods account, the effects of which were offset in part by an increase in deficit from the service account.

***Trade Balance***

Based on preliminary data, the Republic recorded a trade surplus of US$27.8 billion in the first half of 2025. Exports remained relatively stable at US$334.7 billion in the first half of 2025 compared to US$334.8 billion in the corresponding period of 2024. Imports decreased by 1.6% to US$306.9 billion in the first half of 2025 from US$311.9 billion in the corresponding period of 2024, primarily due to a decrease in energy and commodity prices, which also led to decreased unit prices of other major raw materials.

***Foreign Currency Reserves***

The amount of the Government's foreign currency reserves was US$411.3 billion as of July 31, 2025.

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##### [**Table of Contents**](#toc)
**Debt** 

The Government estimates that the total outstanding debt of the Government (including guarantees by the Government) as of December 31, 2023 amounted to approximately W1,102.1 trillion, an increase of 5.6% over the previous year.

The Government estimates that the total outstanding debt of the Government (including guarantees by the Government) as of December 31, 2024 amounted to approximately W1,150.9 trillion, an increase of 4.4% over the previous year.

The Ministry of Economy and Finance administers the national debt of the Republic.

***External and Internal Debt of the Government***

The following table sets out, by currency and the equivalent amount in U.S. dollars, the estimated outstanding direct external debt of the Government as of December 31, 2024:

**Direct External Debt of the Government** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Amount in<br>Original<br>Currency** | **Amount in<br>Original<br>Currency** | **Equivalent<br>Amount in<br>U.S. Dollars<sup>(1)</sup>** | **Equivalent<br>Amount in<br>U.S. Dollars<sup>(1)</sup>** |
|  | **(millions)** | **(millions)** | **(millions)** | **(millions)** |
|  US$ | US$ | 6525.0 | US$ | 6525.0 |
|  Euro (EUR) | EUR | 1400.0 |  | 1455.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total |  |  | US$ | 7980.9 |

---

(1) Amounts expressed in currencies other than US$ are converted to US$ at the arbitrage rate announced by the Seoul
Money Brokerage Services, Ltd. in effect on December 31, 2024.

The following table summarizes, as of December 31 of the years indicated, the outstanding direct internal debt of the Republic:

**Direct Internal Debt of the Government** 

---

| | | |
|:---|:---|:---|
|  | **(billions of Won)** | **(billions of Won)** |
|  2020 |  | 808941.0 |
|  2021 |  | 927865.2 |
|  2022 |  | 1021574.4 |
|  2023 |  | 1080844.4 |
|  2024 |  | 1128191.5 |

---

The following table sets out all guarantees by the Government of indebtedness of others:

**Guarantees by the Government** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** |
|  | **2020** | **2021** | **2022** | **2023** | **2024** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Domestic | 12490.0 | 10930.0 | 10620.0 | 10460.0 | 10960.0 |
|  External<sup>(1)</sup> |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | 12490.0 | 10930.0 | 10620.0 | 10460.0 | 10960.0 |

---

(1) Converted to Won at foreign exchange banks' telegraphed transfer selling rates to customers or the market
average exchange rates in effect on December 31 of each year.

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##### [**Table of Contents**](#toc)
For further information on the outstanding indebtedness, including guarantees, of the Republic, see "—Tables and Supplementary Information".

**Tables and Supplementary Information** 

&nbsp;&nbsp;&nbsp;&nbsp;***A. External Debt of the Government***

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(1) External Bonds of the Government* 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Series** | **Issue Date** | **Maturity Date** | **Interest<br>Rate (%)** | **Currency** | **Original<br>Principal<br>Amount** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** |
| 2005-001 | November 2, 2005 | November 3, 2025 | 5.625 | USD | 400000000 |  | 400000000 |
| 2014-001 | June 10, 2014 | June 10, 2044 | 4.125 | USD | 1000000000 |  | 1000000000 |
| 2017-001 | January 19, 2017 | January 19, 2027 | 2.750 | USD | 1000000000 |  | 1000000000 |
| 2018-001 | September 20, 2018 | September 20, 2028 | 3.500 | USD | 500000000 |  | 500000000 |
| 2018-002 | September 20, 2018 | September 20, 2048 | 3.875 | USD | 500000000 |  | 500000000 |
| 2019-001 | June 19, 2019 | June 19, 2029 | 2.500 | USD | 1000000000 |  | 1000000000 |
| 2020-001 | September 16, 2020 | September 16, 2030 | 1.000 | USD | 625000000 |  | 625000000 |
| 2020-002 | September 16, 2020 | September 16, 2025 | 0.000 | EUR | 700000000 |  | 700000000 |
| 2021-001 | October 15, 2021 | October 15, 2026 | 0.000 | EUR | 700000000 |  | 700000000 |
| 2021-002 | October 15, 2021 | October 15, 2031 | 1.750 | USD | 500000000 |  | 500000000 |
| 2024-001 | July 3, 2024 | July 3, 2029 | 4.500 | USD | 1000000000 |  | 1000000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies |  | USD 6,525,000,000 |
|  |  |  |  |  |  |  | EUR 1,400,000,000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | W | 11731930000000 |

---

(1) U.S. dollar amounts are converted to Won amounts at the rate of US$1.00 to W 1,470.0, the market
average exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd. Euro amounts are converted to Won amounts at the rate of EUR 1.00 to W 1,528.7, the market average exchange rate in
effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(2) External Borrowings of the Government* 

None.

&nbsp;&nbsp;&nbsp;&nbsp;***B. External Guaranteed Debt of the Government***

None.

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##### [**Table of Contents**](#toc)
&nbsp;&nbsp;&nbsp;&nbsp;***C. Internal Debt of the Government***

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Title** | **Range of<br>Interest Rates** | **Range of<br>Years of Issue** | **Range of Years<br>of Original<br>Maturity** | **Principal<br>Amounts<br>Outstanding as<br>of December 31,<br>2024** |
|  | **(%)** | | | **(billions of Won)** |
| **1. Bonds** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-Bearing Treasury Bond for Treasury Bond Management Fund | 0.750-5.750 | 2006-2024 | 2025-2074 | 1047874.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-Bearing Treasury Bond for National Housing I | 1.000-1.750 | 2015-2024 | 2020-2029 | 79100.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-Bearing Treasury Bond for National Housing II | 0 | 2009-2017 | 2019-2029 | 1.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-Bearing Treasury Bond for National Housing III |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-interest-Bearing Treasury Bond for Contribution to International Organizations<sup>(1)</sup> | 0 | 1967-1985 |  | 9.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Bonds |  |  |  | 1126986.5 |
| **2. Borrowings** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from The Bank of Korea |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Sports Promotion Fund | 2.875-3.665 | 2023-2024 | 2025-2029 | 960 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from The Korea Foundation Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Labor Welfare Promotion Fund | 2.920-2.935 | 2024 | 2025 | 50 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from Korea Technology Finance Corporation | 2.870-3.100 | 2024 | 2026 | 195 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Credit Guarantee Fund for Agriculture, Forestry and Fisheries Suppliers |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Government Employees' Pension Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Film Industry Development Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Korea Credit Guarantee Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Housing Finance Credit Guarantee Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Korea Infrastructure Credit Guarantee Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Borrowings |  |  |  | 1205 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total Internal Funded Debt** |  |  |  | 1128191.5 |

---

(1) Interest Rates and Years of Original Maturity not applicable.

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##### [**Table of Contents**](#toc)
&nbsp;&nbsp;&nbsp;&nbsp;***D. Internal Guaranteed Debt of the Government*** 

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Title** | **Range of<br>Interest Rates** | **Range of<br>Years of Issue** | **Range of Years<br>of Original<br>Maturity** | **Principal<br>Amounts<br>Outstanding as<br>of December 31,<br>2024** |
|  | **(%)** | | | **(billions of Won)** |
| **1. Bonds of Government-Affiliated Corporations** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Deposit Insurance Corporation |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Student Aid Foundation | 1.230-5.480 | 2011-2024 | 2025-2044 | 10350.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Supply Chain Resilience Fund | 2.820-2.960 | 2024 | 2026-2027 | 400.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Key Industry Stabilization Fund | 1.450-2.190 | 2020-2021 | 2025 | 210.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total Internal Guaranteed Debt** |  |  |  | 10960.0 |

---

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##### [**Table of Contents**](#toc)
**DESCRIPTION OF THE NOTES** 

*The following is a description of some of the terms of the Notes we are offering. Since it is only a summary, we urge you to read the fiscal agency agreement described below and the forms of global note before deciding whether to invest in the Notes. We have filed a copy of these documents with the United States Securities and Exchange Commission as exhibits to the registration statement no. 333-280021.* 

The general terms of our Notes are described in the accompanying prospectus. The description in this prospectus supplement further adds to that description or, to the extent inconsistent with that description, replaces it.

**The Notes** 

We are offering US$ aggregate principal amount of % notes due September , 2030 (the "Notes").

**Governed by Fiscal Agency Agreement** 

We will issue the Notes under the fiscal agency agreement, dated as of February 15, 1991, as amended and supplemented from time to time, between us and The Bank of New York (now The Bank of New York Mellon), as fiscal agent (the "Fiscal Agency Agreement"). The fiscal agent will maintain a register for the Notes.

**Payment of Principal and Interest** 

The Notes are initially limited to US$ aggregate principal amount. The Notes will mature on September , 2030 (the "Maturity Date"). The Notes will bear interest at the rate of % per annum payable semi-annually in arrear on March and September of each year (each, an "Interest Payment Date"), beginning on March , 2026. Interest on the Notes will accrue from September , 2025. If any Interest Payment Date or any Maturity Date shall be a day on which banking institutions in The City of New York or Seoul are authorized or obligated by law to close, then such payment will not be made on such date but will be made on the next succeeding day which is not a day on which banking institutions in The City of New York or Seoul are authorized or obligated by law to close, with the same force and effect as if made on the date for such payment, and no interest shall be payable in respect of any such delay. We will pay interest to the person who is registered as the owner of a Note at the close of business on the fifteenth day (whether or not a business day) preceding the related Interest Payment Date. Interest on the Notes will be computed on the basis of a 360-day year consisting of twelve 30-day months. We will make principal and interest payments on the Notes in immediately available funds in U.S. dollars.

**Denomination** 

The Notes will be issued in minimum denominations of US$200,000 principal amount and integral multiples of US$1,000 in excess thereof.

**Redemption** 

We may not redeem the Notes prior to maturity. At maturity, we will redeem the Notes at par.

**Form and Registration** 

We will issue each series of the Notes in the form of one or more fully registered global notes, registered in the name of a nominee of and deposited with the custodian for DTC. Except as described in the accompanying

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##### [**Table of Contents**](#toc)
prospectus under "Description of the Securities—Description of Debt Securities—Global Securities," the global notes will not be exchangeable for Notes in definitive registered form, and will not be issued in definitive registered form. Financial institutions, acting as direct and indirect participants in DTC, will represent your beneficial interests in the global notes. These financial institutions will record the ownership and transfer of your beneficial interest through book-entry accounts. You may hold your beneficial interests in the Notes through Euroclear or Clearstream if you are a participant in such systems, or indirectly through organizations that are participants in such systems. Any secondary market trading of book-entry interests in the Notes will take place through DTC participants, including Euroclear and Clearstream. See "Clearance and Settlement—Transfers Within and Between DTC, Euroclear and Clearstream."

***General***

The fiscal agent will not charge you any fees for the Notes, other than reasonable fees for the replacement of lost, stolen, mutilated or destroyed Notes. However, you may incur fees for the maintenance and operation of the book-entry accounts with the clearing systems in which your beneficial interests are held.

For so long as the Notes are listed on the SGX-ST and the rules of the SGX-ST so require, in the event that any of the global notes are exchanged for Notes in definitive registered form, we will appoint and maintain a paying agent in Singapore, where the certificates representing the Notes may be presented or surrendered for payment or redemption. In addition, in the event that any of the global notes are exchanged for Notes in definitive registered form, an announcement of such exchange will be made through the SGX-ST by or on behalf of us. Such announcement will include all material information with respect to the delivery of the certificates representing the Notes, including details of the paying agent in Singapore.

**Further Issues** 

We may from time to time, without the consent of the holders of the Notes, create and issue additional debt securities with the same terms and conditions as either series of the Notes in all respects so that such further issue shall be consolidated and form a single series with the relevant series of the Notes. We will not issue any such additional debt securities unless such additional securities have less than a de minimis amount of original issue discount or such issuance would otherwise constitute a "qualified reopening" for U.S. federal income tax purposes.

**Notices** 

All notices regarding the Notes will be published by us in London in the Financial Times and in New York in The Wall Street Journal (U.S. Edition). If we cannot, for any reason, publish notice in any of those newspapers, we will choose an appropriate alternate English language newspaper of general circulation, and notice in that newspaper will be considered valid notice. Notice will be considered made on the first date of its publication.

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**CLEARANCE AND SETTLEMENT** 

*We have obtained the information in this section from sources we believe to be reliable, including DTC, Euroclear and Clearstream. We accept responsibility only for accurately extracting information from such sources. DTC, Euroclear and Clearstream are under no obligation to perform or continue to perform the procedures described below, and they may modify or discontinue them at any time. Neither we nor the registrar will be responsible for DTC's, Euroclear's or Clearstream's performance of their obligations under their rules and procedures. Nor will we or the registrar be responsible for the performance by direct or indirect participants of their obligations under their rules and procedures.* 

**Introduction** 

***The Depository Trust Company***

DTC is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a limited-purpose trust company organized under the New York Banking Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a "banking organization" under the New York Banking Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a member of the Federal Reserve System;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a "clearing corporation" under the New York Uniform Commercial Code; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a "clearing agency" registered under Section 17A of the Securities Exchange Act of 1934.

DTC was created to hold securities for its participants and facilitate the clearance and settlement of securities transactions between its participants. It does this through electronic book-entry changes in the accounts of its direct participants, eliminating the need for physical movement of securities certificates.

***Euroclear and Clearstream***

Like DTC, Euroclear and Clearstream hold securities for their participants and facilitate the clearance and settlement of securities transactions between their participants through electronic book-entry changes in their accounts. Euroclear and Clearstream provide various services to their participants, including the safekeeping, administration, clearance and settlement and lending and borrowing of internationally traded securities. Participants in Euroclear and Clearstream are financial institutions such as underwriters, securities brokers and dealers, banks and trust companies. Some of the underwriters participating in this offering are participants in Euroclear or Clearstream. Other banks, brokers, dealers and trust companies have indirect access to Euroclear or Clearstream by clearing through or maintaining a custodial relationship with a Euroclear or Clearstream participant.

***Ownership of the Notes through DTC, Euroclear and Clearstream***

We will issue the Notes in the form of one or more fully registered global notes, registered in the name of a nominee of DTC. Financial institutions, acting as direct and indirect participants in DTC, will represent your beneficial interests in the global notes. These financial institutions will record the ownership and transfer of your beneficial interests through book-entry accounts. You may hold your beneficial interests in the global notes through Euroclear or Clearstream, if you are a DTC participant in such systems, or indirectly through organizations that are DTC participants in such systems. Euroclear and Clearstream will hold their Euroclear/Clearstream participants' beneficial interests in the global notes in their customers' securities accounts with their depositaries. These depositaries of Euroclear and Clearstream in turn will hold such interests in their customers' securities accounts with DTC.

We and the fiscal agent generally will treat the registered holder of the Notes, initially Cede & Co., as the absolute owner of the Notes for all purposes. Once we and the fiscal agent make payments to the registered

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holder, we and the fiscal agent will no longer be liable on the Notes for the amounts so paid. Accordingly, if you own a beneficial interest in the global notes, you must rely on the procedures of the institutions through which you hold your interests in the Notes, including DTC, Euroclear, Clearstream and their respective participants, to exercise any of the rights granted to holders of Notes. Under existing industry practice, if you desire to take any action that Cede & Co., as the holder of the global notes, is entitled to take, then Cede & Co. would authorize the DTC participant through which you own your beneficial interest to take such action. The DTC participant would then either authorize you to take the action or act for you on your instructions.

DTC may grant proxies or authorize its DTC participants, or persons holding beneficial interests in the Notes through such DTC participants, to exercise any rights of a holder or take any actions that a holder is entitled to take under the Fiscal Agency Agreement or the Notes. Euroclear's or Clearstream's ability to take actions as holder under the Notes or the Fiscal Agency Agreement will be limited by the ability of their respective depositaries to carry out such actions for them through DTC. Euroclear and Clearstream will take such actions only in accordance with their respective rules and procedures.

The fiscal agent will not charge you any fees for the Notes, other than reasonable fees and indemnity satisfactory to the fiscal agent for the replacement of lost, stolen, mutilated or destroyed Notes. However, you may incur fees for the maintenance and operation of the book-entry accounts with the clearing systems in which your beneficial interests are held.

**Transfers Within and Between DTC, Euroclear and Clearstream** 

***Trading Between DTC Purchasers and Sellers***

DTC participants will transfer interests in the Notes among themselves in the ordinary way according to DTC rules. Participants will pay for such transfers by wire transfer. The laws of some states require certain purchasers of securities to take physical delivery of the securities in definitive form. These laws may impair your ability to transfer beneficial interests in the global notes to such purchasers. DTC can act only on behalf of its direct participants, who in turn act on behalf of indirect participants and certain banks. Thus, your ability to pledge a beneficial interest in the global notes to persons that do not participate in the DTC system, and to take other actions, may be limited because you will not possess a physical certificate that represents your interest.

***Trading Between Euroclear and/or Clearstream Participants***

Participants in Euroclear and Clearstream will transfer interests in the Notes among themselves according to the rules and operating procedures of Euroclear and Clearstream.

***Trading Between a DTC Seller and a Euroclear or Clearstream Purchaser***

When the Notes are to be transferred from the account of a DTC participant to the account of a Euroclear or Clearstream participant, the purchaser must first send instructions to Euroclear or Clearstream through a participant at least one business day prior to the settlement date. Euroclear or Clearstream will then instruct its depositary to receive the Notes and make payment for them. On the settlement date, the depositary will make payment to the DTC participant's account, and the Notes will be credited to the depositary's account. After settlement has been completed, DTC will credit the Notes to Euroclear or Clearstream, Euroclear or Clearstream will credit the Notes, in accordance with its usual procedures, to the participant's account, and the participant will then credit the purchaser's account. These securities credits will appear the next day (European time) after the settlement date. The cash debit from the account of Euroclear or Clearstream will be back-valued to the value date, which will be the preceding day if settlement occurs in New York. If settlement is not completed on the intended value date (i.e., the trade fails), the cash debit will instead be valued at the actual settlement date.

Participants in Euroclear and Clearstream will need to make funds available to Euroclear or Clearstream to pay for the Notes by wire transfer on the value date. The most direct way of doing this is to pre-position funds

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(i.e., have funds in place at Euroclear or Clearstream before the value date), either from cash on hand or existing lines of credit. Under this approach, however, participants may take on credit exposure to Euroclear and Clearstream until the Notes are credited to their accounts one day later.

As an alternative, if Euroclear or Clearstream has extended a line of credit to a participant, the participant may decide not to pre-position funds, but to allow Euroclear or Clearstream to draw on the line of credit to finance settlement for the Notes. Under this procedure, Euroclear or Clearstream would charge the participant overdraft charges for one day, assuming that the overdraft would be cleared when the Notes were credited to the participant's account. However, interest on the Notes would accrue from the value date. Therefore, in many cases the interest income on the Notes which the participant earns during that one-day period will substantially reduce or offset the amount of the participant's overdraft charges. Of course, this result will depend on the cost of funds (i.e., the interest rate that Euroclear or Clearstream charges) to each participant.

Since the settlement will occur during New York business hours, a DTC participant selling an interest in the Notes can use its usual procedures for transferring global securities to the depositories of Euroclear or Clearstream for the benefit of Euroclear or Clearstream participants. The DTC seller will receive the sale proceeds on the settlement date. Thus, to the DTC seller, a cross-market sale will settle no differently than a trade between two DTC participants.

Finally, day traders who use Euroclear or Clearstream and who purchase Notes from DTC participants for credit to Euroclear participants or Clearstream participants should note that these trades will automatically fail unless one of three steps is taken:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• borrowing through Euroclear or Clearstream for one day, until the purchase side of the day trade is reflected in the day trader's Euroclear or Clearstream account, in accordance with the clearing system's
customary procedures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• borrowing the Notes in the United States from DTC participants no later than one day prior to settlement, which would allow sufficient time for the Notes to be reflected in the Euroclear or Clearstream account in order
to settle the sale side of the trade; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• staggering the value dates for the buy and sell sides of the trade so that the value date for the purchase from the DTC participant is at least one day prior to the value date for the sale to the Euroclear or
Clearstream participant.

***Trading Between a Euroclear or Clearstream Seller and a DTC Purchaser***

Due to time-zone differences in their favor, Euroclear and Clearstream participants can use their usual procedures to transfer Notes through their depositaries to a DTC participant. The seller must first send instructions to Euroclear or Clearstream through a participant at least one business day prior to the settlement date. Euroclear or Clearstream will then instruct its depositary to credit the Notes to the DTC participant's account and receive payment. The payment will be credited in the account of the Euroclear or Clearstream participant on the following day, but the receipt of the cash proceeds will be back-valued to the value date, which will be the preceding day if settlement occurs in New York. If settlement is not completed on the intended value date (i.e., the trade fails), the receipt of the cash proceeds will instead be valued at the actual settlement date.

If the Euroclear or Clearstream participant selling the Notes has a line of credit with Euroclear or Clearstream and elects to be in debit for the Notes until it receives the sale proceeds in its account, then the back-valuation may substantially reduce or offset any overdraft charges that the participant incurs over that period.

Settlement in other currencies between DTC and Euroclear and Clearstream is possible using free-of-payment transfers to move the Notes, but funds movement will take place separately.

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**TAXATION** 

**Korean Taxation** 

For a discussion of certain Korean tax considerations that may be relevant to you if you invest in the Notes, see "Taxation—Korean Taxation" in the accompanying prospectus.

**U.S. Federal Income Tax Considerations** 

For a discussion of U.S. federal income tax considerations that may be relevant to you if you are a beneficial owner of the Notes and are a U.S. holder, see "Taxation—U.S. Federal Income Tax Considerations" in the accompanying prospectus.

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**UNDERWRITING** 

**Relationship with the Underwriters** 

We and the underwriters named below (the "Underwriters") have entered into a Terms Agreement dated September , 2025 (the "Terms Agreement") with respect to the Notes relating to the Underwriting Agreement—Standard Terms (together with the Terms Agreement, the "Underwriting Agreement") filed as an exhibit to the registration statement. Subject to the terms and conditions set forth in the Underwriting Agreement, we have agreed to sell to each of the Underwriters, severally and not jointly, and each of the Underwriters has, severally and not jointly, agreed to purchase, the following principal amount of the Notes set out opposite its name below:

---

| | |
|:---|:---|
| **Names of the Underwriters** | **Principal Amount of<br>the Notes** |
|  Citigroup Global Markets Limited | US$ |
|  The Hongkong and Shanghai Banking Corporation |  |
|  KDB Asia Limited |  |
|  Mizuho Securities Asia Limited |  |
|  UBS AG Hong Kong Branch |  |
|  **Total** | **US$** |

---

Any Underwriter who is not registered as a broker-dealer with the Securities and Exchange Commission will not engage in any transaction related to the Notes in the United States except as permitted by the Exchange Act. KDB Asia Limited, one of the underwriters, is our affiliate and has agreed to offer and sell the Notes only outside the United States to non-U.S. persons.

Under the terms and conditions of the Underwriting Agreement, if the Underwriters take any series of the Notes, then the Underwriters are obligated to take and pay for all of the Notes of such series.

The Underwriters initially propose to offer the Notes directly to the public at the offering price described on the cover page of this prospectus supplement. After the initial offering of the Notes, the Underwriters may from time to time vary the offering price and other selling terms.

If a jurisdiction requires that the offering be made by a licensed broker or dealer and the Underwriters or any affiliate of the Underwriters is a licensed broker or dealer in that jurisdiction, the offering shall be deemed to be made by that Underwriter or its affiliate on our behalf in such jurisdiction.

The Notes are a new class of securities with no established trading market. Applications will be made to the SGX-ST for the listing and quotation of the Notes on the SGX-ST. In addition, applications will be made to list the Notes on the Luxembourg Stock Exchange and to have the Notes admitted to trading on the Euro MTF Market of the Luxembourg Stock Exchange. Applications will also be made for listing of the Notes to the International Securities Market of the London Stock Exchange. No assurance can be given that such applications will be approved or that such listings will be maintained. The Underwriters have advised us that they intend to make a market in the Notes. However, they are not obligated to do so and they may discontinue any market making activities with respect to the Notes at any time without notice. Accordingly, we cannot assure you as to the liquidity of any trading market for the Notes.

We have agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to contribute to payments which the Underwriters may be required to make in respect of any such liabilities.

The amount of our net proceeds from the Notes is US$ after deducting underwriting discounts but not estimated expenses. Expenses associated with the Notes offering are estimated to be US$100,000. The Underwriters have agreed to pay certain of our expenses incurred in connection with the offering of the Notes.

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The Underwriters and certain of their affiliates may have performed certain commercial banking, investment banking and advisory services for us and/or our affiliates from time to time for which they have received customary fees and expenses and may, from time to time, engage in transactions with and perform services for us and/or our affiliates in the ordinary course of their business.

The Underwriters or certain of their affiliates may purchase Notes and be allocated Notes for asset management and/or proprietary purposes but not with a view to distribution. The Underwriters or their respective affiliates may purchase Notes for their own account and enter into transactions, including credit derivatives, such as asset swaps, repackaging and credit default swaps relating to Notes and/or other securities of us or our subsidiaries or affiliates at the same time as the offer and sale of Notes or in secondary market transactions. Such transactions would be carried out as bilateral trades with selected counterparties and separately from any existing sale or resale of Notes to which this prospectus supplement relates (notwithstanding that such selected counterparties may also be purchasers of Notes).

**Important Notice to CMIs (including private banks)** 

This notice to CMIs (including private banks) is a summary of certain obligations the SFC Code imposes on CMIs, which require the attention and cooperation of other CMIs (including private banks). Certain CMIs may also be acting as OCs for this offering and are subject to additional requirements under the SFC Code.

Prospective investors who are the directors, employees or major shareholders of the Issuer, a CMI or its group companies would be considered under the SFC Code as having an Association with the Issuer, the CMI or the relevant group company. CMIs should specifically disclose whether their investor clients have any Association when submitting orders for the Notes. In addition, private banks should take all reasonable steps to identify whether their investor clients may have any Associations with the Issuer or any CMI (including its group companies) and inform the Underwriters accordingly.

CMIs are informed that the marketing and investor targeting strategy for this offering includes institutional investors, sovereign wealth funds, pension funds, hedge funds, family offices and high net worth individuals, in each case, subject to the selling restrictions and any UK MiFIR product governance language set out elsewhere in this prospectus supplement.

CMIs should ensure that orders placed are bona fide, are not inflated and do not constitute duplicated orders (i.e., two or more corresponding or identical orders placed via two or more CMIs). CMIs should enquire with their investor clients regarding any orders which appear unusual or irregular. CMIs should disclose the identities of all investors when submitting orders for the Notes (except for omnibus orders where underlying investor information may need to be provided to any OCs when submitting orders). Failure to provide underlying investor information for omnibus orders, where required to do so, may result in that order being rejected. CMIs should not place "X-orders" into the order book.

CMIs should segregate and clearly identify their own proprietary orders (and those of their group companies, including private banks as the case may be) in the order book and book messages.

CMIs (including private banks) should not offer any rebates to prospective investors or pass on any rebates provided by the Issuer. In addition, CMIs (including private banks) should not enter into arrangements which may result in prospective investors paying different prices for the Notes.

The SFC Code requires that a CMI disclose complete and accurate information in a timely manner on the status of the order book and other relevant information it receives to targeted investors for them to make an informed decision. In order to do this, those Underwriters in control of the order book should consider disclosing order book updates to all CMIs.

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When placing an order for the Notes, private banks should disclose, at the same time, if such order is placed other than on a "principal" basis (whereby it is deploying its own balance sheet for onward selling to investors). private banks who do not provide such disclosure are hereby deemed to be placing their order on such a "principal" basis. Otherwise, such order may be considered to be an omnibus order pursuant to the SFC Code. private banks should be aware that placing an order on a "principal" basis may require the Underwriters to apply the "proprietary orders" of the SFC Code to such order and will require the Underwriters to apply the "rebates" requirements of the SFC Code (if applicable) to such order.

In relation to omnibus orders, when submitting such orders, CMIs (including private banks) that are subject to the SFC Code should disclose underlying investor information in respect of each order constituting the relevant omnibus order (failure to provide such information may result in that order being rejected). Underlying investor information in relation to omnibus orders should consist of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The name of each underlying investor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• A unique identification number for each investor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Whether an underlying investor has any "Associations" (as used in the SFC Code);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Whether any underlying investor order is a "Proprietary Order" (as used in the SFC Code);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Whether any underlying investor order is a duplicate order.

Underlying investor information in relation to omnibus orders should be sent to: kdb_syndicate@kdb.co.kr; and Omnibus_Bond@hk.mizuho-sc.com.

To the extent information being disclosed by CMIs and investors is personal and/or confidential in nature, CMIs (including private banks) agree and warrant: (A) to take appropriate steps to safeguard the transmission of such information to any OCs; and (B) that they have obtained the necessary consents from the underlying investors to disclose such information to any OCs. By submitting an order and providing such information to any OCs, each CMI (including private banks) further warrants that they and the underlying investors have understood and consented to the collection, disclosure, use and transfer of such information by any OCs and/or any other third parties as may be required by the SFC Code, including to the Issuer, relevant regulators and/or any other third parties as may be required by the SFC Code, for the purpose of complying with the SFC Code, during the bookbuilding process for this offering. CMIs that receive such underlying investor information are reminded that such information should be used only for submitting orders in this offering. The Underwriters may be asked to demonstrate compliance with their obligations under the SFC Code, and may request other CMIs (including private banks) to provide evidence showing compliance with the obligations above (in particular, that the necessary consents have been obtained). In such event, other CMIs (including private banks) are required to provide the Underwriters with such evidence within the timeline requested.

By placing an order, prospective investors (including any underlying investors in relation to omnibus orders) are deemed to represent to the Underwriters that it is not a Sanctions Restricted Person. A "Sanctions Restricted Person" means an individual or entity (a "Person"): (a) that is, or is directly or indirectly owned or controlled by a Person that is, described or designated in (i) the most current "Specially Designated Nationals and Blocked Persons" list (which as of the date hereof can be found at: http://www.treasury.gov/ofac/downloads/sdnlist.pdf) or (ii) the Foreign Sanctions Evaders List (which as of the date hereof can be found at: http://www.treasury.gov/ofac/downloads/fse/fselist.pdf) or (iii) the most current "Consolidated list of persons, groups and entities subject to EU financial sanctions" (which as of the date hereof can be found at: https://eeas.europa.eu/headquarters/headquartershomepage_en/8442/Consolidated%20list%20of%20sanctions); or (b) that is otherwise the subject of any sanctions administered or enforced by any Sanctions Authority, other than solely by virtue of: (i) their inclusion in the most current "Sectoral Sanctions Identifications" list (which as of the date hereof can be found at: https://www.treasury.gov/ofac/downloads/ssi/ssilist.pdf) (the "SSI List"), (ii) their inclusion in Annexes 3, 4, 5 and 6 of Council Regulation No. 833/2014, as amended by Council Regulation

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No. 960/2014 (the "EU Annexes"), (iii) their inclusion in any other list maintained by a Sanctions Authority, with similar effect to the SSI List or the EU Annexes, (iv) them being the subject of restrictions imposed by the U.S. Department of Commerce's Bureau of Industry and Security ("BIS") under which BIS has restricted exports, re-exports or transfers of certain controlled goods, technology or software to such individuals or entities; (v) them being an entity listed in the Annex to the new Executive Order of 3 June 2021 entitled "Addressing the Threat from Securities Investments that Finance Certain Companies of the People's Republic of China" (known as the Non-SDN Chinese Military- Industrial Complex Companies List), which amends the Executive Order 13959 of 12 November 2020 entitled "Addressing the threat from Securities Investments that Finance Chinese Military Companies"; or (vi) them being subject to restrictions imposed on the operation of an online service, Internet application or other information or communication services in the United States directed at preventing a foreign government from accessing the data of U.S. persons; or (c) that is located, organized or a resident in a comprehensively sanctioned country or territory, including Cuba, Iran, North Korea, Syria, the Crimea region of Ukraine, the Donetsk's People's Republic or Luhansk People's Republic. "Sanctions Authority" means: (a) the United States government; (b) the United Nations; (c) the European Union (or any of its member states); (d) the United Kingdom; (e) any other equivalent governmental or regulatory authority, institution or agency which administers economic, financial or trade sanctions; and (f) the respective governmental institutions and agencies of any of the foregoing including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury, the United States Department of State, the United States Department of Commerce and His Majesty's Treasury.

**Delivery of the Notes** 

We expect to make delivery of the Notes, against payment in same-day funds on or about September , 2025, which we expect will be the business day following the date of this prospectus supplement. Under Rule 15c6-1 promulgated under the Securities Exchange Act of 1934, as amended, U.S. purchasers are generally required to settle trades in the secondary market in one business day, unless they and the other parties to any such trade expressly agree otherwise. Accordingly, if you wish to trade in the Notes on any day prior to the first business day from the settlement, because the Notes will initially settle in T+ , you may be required to specify an alternate settlement cycle at the time of your trade to prevent a failed settlement. Purchasers in other countries should consult with their own advisors.

**Foreign Selling Restrictions** 

Each Underwriter has agreed, severally and not jointly, to the following selling restrictions in connection with the offering with respect to the following jurisdictions:

***Korea***

Each Underwriter has severally represented and agreed that (i) it has not offered, sold or delivered and will not offer, sell or deliver, directly or indirectly, any Notes in Korea, or to, or for the account or benefit of, any resident of Korea, except as otherwise permitted by applicable Korean laws and regulations, and (ii) any securities dealer to whom the Underwriters may sell the Notes will agree that it will not offer any Notes, directly or indirectly, in Korea, or to any resident of Korea, except as permitted by applicable Korean laws and regulations, or to any other dealer who does not so represent and agree.

***United Kingdom***

Each Underwriter has severally represented and agreed that (i) it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act of 2000 (the "FSMA")) received by it in connection with the issue or sale of any Notes in circumstances in which Section 21(1) of the FSMA does not apply to us, and (ii) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to any Notes in, from or otherwise involving the United Kingdom.

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***Spain***

The proposed offer of Notes has not been registered with the Comisión Nacional del Mercado de Valores (the "CNMV"). Accordingly, each of the Underwriters has represented and agreed that Notes can only be offered in Spain to qualified investors pursuant to and in compliance with the consolidated text of the Securities Market Law approved by Spanish Royal Legislative Decree 4/2015, Spanish Royal Decree 1310/2005, both as amended from time to time, and any regulation issued thereunder.

***Japan***

Each Underwriter has severally represented and agreed that the Notes have not been and will not be registered under the Financial Instruments and Exchange Act of Japan (Act No. 25 of 1948, as amended, the "Financial Instruments and Exchange Act"). Accordingly, each Underwriter has severally represented and agreed that it has not, directly or indirectly, offered or sold and will not, directly or indirectly, offer or sell any Notes in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan) or to others for re-offering or re-sale, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Act and other relevant laws and regulations of Japan.

***Hong Kong***

Each Underwriter has severally represented and agreed that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• it has not offered or sold and will not offer or sell in Hong Kong, by means of any document, any Notes other than (a) to "professional investors" as defined in the Securities and Futures Ordinance (Cap.
571) of Hong Kong (the "SFO") and any rules made under the SFO; or (b) in other circumstances which do not result in the document being a "prospectus" as defined in the Companies (Winding Up and Miscellaneous Provisions)
Ordinance (Cap. 32) of Hong Kong (the "C(WUMP)O") or which do not constitute an offer to the public within the meaning of the C(WUMP)O; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• it has not issued or had in its possession for the purposes of issue, and will not issue or have in its possession for the purposes of issue, whether in Hong Kong or elsewhere, any advertisement, invitation or document
relating to the Notes, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to Notes which are or
are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" as defined in the SFO and any rules made under the SFO.

***Singapore***

Each Underwriter has acknowledged that this prospectus supplement and the accompanying prospectus have not been registered as a prospectus with the Monetary Authority of Singapore.

Accordingly, each Underwriter has severally represented and agreed that it has not offered or sold any Notes or caused the Notes to be made the subject of an invitation for subscription or purchase and will not offer or sell any Notes or cause the Notes to be made the subject of an invitation for subscription or purchase, and has not circulated or distributed, nor will it circulate or distribute, this prospectus supplement or the accompanying prospectus or any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the Notes, whether directly or indirectly, to any person in Singapore other than (i) to an institutional investor (as defined in Section 4A of the Securities and Futures Act 2001 of Singapore, as modified or amended from time to time (the "SFA")) pursuant to Section 274 of the SFA; or (ii) to an accredited investor (as defined in Section 4A of the SFA) pursuant to and in accordance with the conditions specified in Section 275 of the SFA.

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***Australia***

No prospectus or other disclosure document (as defined in the Corporations Act 2001 of Australia) in relation to the offering of the Notes has been or will be lodged with or registered by Australian Securities and Investments Commission or the Australian Securities Exchange Limited. Each Underwriter has represented and agreed that it has not:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) made or invited, and will not make or invite, an offer of the Notes for issue or sale in Australia (including
an offer or invitation which is received by a person in Australia); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) distributed or published and will not distribute or publish any draft, preliminary or final form offering
memorandum, advertisement or other offering material relating to the Notes in Australia,

unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the minimum aggregate consideration payable by each offeree is at least AUD 500,000 (or its equivalent in an
alternate currency) (disregarding money lent by the offeror or its associates) or the offer otherwise does not require disclosure to investors in accordance with Part 6D.2 and Part 7 of the Corporations Act 2001 of Australia; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) such action complies with all applicable laws, directives and regulations and does not require any document to
be lodged with, or registered by, the Australian Securities and Investments Commission.

Each Underwriter has agreed that it will not sell the Notes in circumstances where employees of the Underwriter aware of, or involved in, the sale know, or have reasonable grounds to suspect, that the Notes, or an interest in or right in respect of the Notes, was being, or would later be, acquired either directly or indirectly by a resident of Australia, or a non-resident who is engaged in carrying on business in Australia at or through a permanent establishment of that non-resident in Australia (the expressions "resident of Australia", "non-resident" and "permanent establishment" having the meanings given to them by the Australian Tax Act).

***Canada***

Prospective Canadian investors are advised that the information contained within the prospectus supplement and the accompanying prospectus has not been prepared with regard to matters that may be of particular concern to Canadian investors. Accordingly, prospective Canadian investors should consult with their own legal, financial and tax advisers concerning the information contained within the prospectus supplement and the accompanying prospectus and as to the suitability of an investment in the Notes in their particular circumstances.

Each Underwriter has severally represented and agreed that the Notes may only be offered or sold in the provinces of Alberta, British Columbia, Ontario and Québec or to or for the benefit of a resident of these provinces pursuant to an exemption from the requirement to file a prospectus in such province in which such offer or sale is made, and only by a dealer duly registered under the applicable securities laws of that province or by a dealer that is relying in that province on the "international dealer" exemption provided by section 8.18 of National Instrument 31-103 *Registration Requirements*, *Exemptions and Ongoing Registrant Obligations* (NI 31-103). Furthermore, the Notes may only be offered or sold to or for the benefit of a resident of any such province provided that such resident is purchasing, or deemed to be purchasing, as principal and is both an "accredited investor" as defined in National Instrument 45-106 *Prospectus Exemptions* (NI 45-106) or subsection 73.3 (1) of the *Securities Act* (Ontario) and a "permitted client" as defined in NI 31-103. By purchasing any Notes and accepting delivery of a purchase confirmation a purchaser is representing to the underwriters and the dealer from whom the purchase confirmation is received that it is an "accredited investor" and "permitted client" as defined above. The distribution of the Notes in Canada is being made on a private placement basis only and any resale of the Notes must be made in accordance with applicable Canadian securities laws, which will vary depending on the relevant jurisdiction, and which may require resales to be made in accordance with prospectus and registration requirements or exemptions from the prospectus and registration requirements.

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##### [**Table of Contents**](#toc)
Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus supplement or the accompanying prospectus (including any amendment hereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser's province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser's province or territory for particulars of these rights or consult with a legal advisor.

Under Canadian securities law, National Instrument 33-105 *Underwriting Conflicts* (NI 33-105) provides disclosure requirements with respect to potential conflicts of interest between an issuer and underwriters, dealers or placement agents, as the case may be. To the extent any conflict of interest between us and any of the Underwriters (or any other placement agent acting in connection with this offering) may exist in respect of this offering, the applicable parties to this offering are relying on the exemption from these disclosure requirements provided to them by section 3A.3 of NI 33-105 (exemption based on U.S. disclosure).

Upon receipt of this prospectus, each Canadian purchaser hereby confirms that it has expressly requested that all documents evidencing or relating in any way to the sale of the securities described herein (including for greater certainty any purchase confirmation or any notice) be drawn up in the English language only. *Par la réception de ce prospectus, chaque acheteur canadien confirme par les présentes qu'il a expressément exigé que tous les documents faisant foi ou se rapportant de quelque manière que ce soit à la vente des valeurs mobilières décrites aux présentes (incluant, pour plus de certitude, toute confirmation d'achat ou tout avis) soient rédigés en anglais seulement.*

**Price Stabilization and Short Position** 

In connection with this offering, any of the Underwriters appointed and acting in its capacity as stabilizing manager (the "Stabilizing Manager") or any person acting for it, on behalf of the Underwriters, may purchase and sell the Notes in the open market. These transactions may include over-allotment, covering transactions, penalty bids and stabilizing transactions. Over-allotment involves sales of the Notes in excess of the principal amount of Notes to be purchased by the Underwriters in this offering, which creates a short position for the Underwriters. Covering transactions involve purchases of the Notes in the open market after the distribution has been completed in order to cover short positions. A penalty bid occurs when a particular Underwriter repays to the Underwriters a portion of the underwriting discount received by it because the Underwriters or the Stabilizing Manager has repurchased Notes sold by or for the account of such Underwriter in stabilizing or short covering transactions. Stabilizing transactions consist of certain bids or purchases of Notes in the open market for the purpose of preventing or retarding a decline in the market price of the Notes while the offering is in progress. Any of these activities may have the effect of preventing or retarding a decline in the market price of the Notes. They may also cause the price of the Notes to be higher than the price that otherwise would exist in the open market in the absence of these transactions. The Stabilizing Manager may conduct these transactions in the over-the-counter market or otherwise. If the Stabilizing Manager commences any of these transactions, it may discontinue them at any time, and must discontinue them after a limited period.

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##### [**Table of Contents**](#toc)
**LEGAL MATTERS** 

The validity of the Notes is being passed upon for us by Cleary Gottlieb Steen & Hamilton LLP, New York, New York, and by Shin & Kim LLC, Seoul, Korea. Certain legal matters will also be passed upon for the Underwriters by Linklaters LLP, Seoul, Korea. In giving their opinions, Cleary Gottlieb Steen & Hamilton LLP and Linklaters LLP may rely as to matters of Korean law upon the opinion of Shin & Kim LLC, and Shin & Kim LLC may rely as to matters of New York law upon the opinions of Cleary Gottlieb Steen & Hamilton LLP.

**OFFICIAL STATEMENTS AND DOCUMENTS** 

Our Acting Chief Executive Officer and Chairman of the Board of Directors, in his official capacity, has supplied the information set forth in this prospectus supplement under "Recent Developments—The Korea Development Bank." Such information is stated on his authority. The documents identified in the portion of this prospectus supplement captioned "Recent Developments—The Republic of Korea" as the sources of financial or statistical data are derived from official public documents of the Republic and of its agencies and instrumentalities.

**GENERAL INFORMATION** 

We were established in 1954 as a government-owned financial institution pursuant to The Korea Development Bank Act, as amended. The address of our registered office is 14, Eunhaeng-ro, Yeongdeungpo-gu, Seoul 07242, The Republic of Korea. Our Legal Entity Identifier is 549300ML2LNRZUCS7149.

Our Board of Directors can be reached at the address of our registered office: c/o 14, Eunhaeng-ro, Yeongdeungpo-gu, Seoul 07242, The Republic of Korea.

The issue of the Notes has been authorized by a resolution of our Board of Directors passed on December 26, 2024 and a decision of our Acting Chief Executive Officer dated August 12, 2025. On August 21, 2025, we filed our reports on the proposed issuance of the Notes with the Ministry of Economy and Finance of Korea.

The registration statement with respect to us and the Notes has been filed with the U.S. Securities and Exchange Commission in Washington, D.C. under the Securities Act of 1933, as amended. Additional information concerning us and the Notes is contained in the registration statement and post-effective amendments to such registration statement, including their various exhibits, which are available to the public from the U.S. Securities and Exchange Commission's website at http://www.sec.gov. This website is maintained by the U.S. Securities and Exchange Commission and contains reports and other information regarding issuers that file electronically with the U.S. Securities and Exchange Commission.

The Notes have been accepted for clearance through DTC, Euroclear and Clearstream:

---

| | | | |
|:---|:---|:---|:---|
|  | **ISIN** | **CUSIP** | **Common code** |
|  Notes |  |  |  |

---

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##### [**Table of Contents**](#toc)
**PROSPECTUS**![LOGO](g82964g03g03.jpg)

**US$12,854,705,000** 

## The Korea Development Bank
**Debt Securities** 

**Warrants to Purchase Debt Securities** 

**Guarantees** 

## The Republic of Korea
**Guarantees** 

**We will provide the specific terms of these securities in supplements to this prospectus. You should read this prospectus and any prospectus supplement carefully before you invest.** 

*Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.* 

This prospectus is dated May 20, 2025

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##### [**Table of Contents**](#toc)
**TABLE OF CONTENTS** 

---

| | |
|:---|:---|
|  | **Page** |
|  [CERTAIN DEFINED TERMS AND CONVENTIONS](#toc82964_1) | 1 |
|  [USE OF PROCEEDS](#toc82964_2) | 2 |
|  [THE KOREA DEVELOPMENT BANK](#toc82964_3) | 3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Overview](#toc82964_4) | 3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Capitalization](#toc82964_5) | 5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Business](#toc82964_6) | 6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Selected Financial Statement Data](#toc82964_7) | 8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Operations](#toc82964_8) | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Sources of Funds](#toc82964_9) | 22 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Debt](#toc82964_10) | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Overseas Operations](#toc82964_11) | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Property](#toc82964_12) | 26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Directors and Management; Employees](#toc82964_13) | 26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Tables and Supplementary Information](#toc82964_14) | 27 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Financial Statements and the Auditors](#toc82964_15) | 34 |
|  [THE REPUBLIC OF KOREA](#toc82964_16) | 165 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Land and History](#toc82964_17) | 165 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Government and Politics](#toc82964_18) | 167 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [The Economy](#toc82964_19) | 170 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Principal Sectors of the Economy](#toc82964_20) | 178 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [The Financial System](#toc82964_21) | 185 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Monetary Policy](#toc82964_22) | 190 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Balance of Payments and Foreign Trade](#toc82964_23) | 194 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Government Finance](#toc82964_24) | 201 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Debt](#toc82964_25) | 204 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Tables and Supplementary Information](#toc82964_26) | 207 |
|  [DESCRIPTION OF THE SECURITIES](#toc82964_27) | 210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Description of Debt Securities](#toc82964_28) | 210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Description of Warrants](#toc82964_29) | 217 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Terms Applicable to Debt Securities and Warrants](#toc82964_30) | 217 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Description of Guarantees to be Issued by Us](#toc82964_31) | 218 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Description of Guarantees to be Issued by The Republic of Korea](#toc82964_32) | 219 |
|  [LIMITATIONS ON ISSUANCE OF BEARER DEBT SECURITIES AND BEARER WARRANTS](#toc82964_33) | 220 |
|  [TAXATION](#toc82964_34) | 221 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [Korean Taxation](#toc82964_35) | 221 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [U.S. Federal Income Tax Considerations](#toc82964_36) | 223 |
|  [PLAN OF DISTRIBUTION](#toc82964_37) | 232 |
|  [LEGAL MATTERS](#toc82964_38) | 233 |
|  [AUTHORIZED REPRESENTATIVES IN THE UNITED STATES](#toc82964_39) | 233 |
|  [OFFICIAL STATEMENTS AND DOCUMENTS](#toc82964_40) | 233 |
|  [EXPERTS](#toc82964_41) | 233 |
|  [FORWARD-LOOKING STATEMENTS](#toc82964_42) | 234 |
|  [FURTHER INFORMATION](#toc82964_43) | 236 |

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##### [**Table of Contents**](#toc)
**CERTAIN DEFINED TERMS AND CONVENTIONS** 

All references to the "Bank", "we", "our" or "us" mean The Korea Development Bank. All references to "Korea" or the "Republic" contained in this prospectus mean The Republic of Korea. All references to the "Government" mean the government of Korea.

Unless otherwise indicated, all references to "won", "Won" or "W" contained in this prospectus are to the currency of Korea, references to "U.S. dollars", "Dollars", "$", "USD" or "US$" are to the currency of the United States of America, references to "Euro", "EUR" or "€" are to the currency of the European Union, references to "Japanese Yen", "JPY" or "¥" are to the currency of Japan, references to "Singapore dollar" or "SGD" are to the currency of Singapore, references to "Swiss franc" or "CHF" are to the currency of Switzerland, references to "pound sterling", "GBP" or "£" are to the currency of the United Kingdom, references to "Chinese offshore renminbi" or "CNH" are to the currency of the People's Republic of China traded outside of mainland China, references to "Hong Kong dollar" or "HKD" are to the currency of Hong Kong, S.A.R., references to "Mexican Peso" or "MXN" are to the currency of the United Mexican States, references to "New Zealand Dollar" or "NZD" are to the currency of New Zealand, references to "Australian dollar" or "AUD" are to the currency of Australia, references to "Norwegian krone" or "NOK" are to the currency of Norway, references to "Brazilian real" or "BRL" are to the currency of the Federative Republic of Brazil, references to "Indonesian Rupiah" or "IDR" are to the currency of Indonesia, references to "Indian Rupee" or "INR" are to the currency of India, references to "Swedish Krona" or "SEK" are to the currency of Sweden and references to "Thai Baht" or "THB" are to the currency of Thailand.

All discrepancies in any table between totals and the sums of the amounts listed are due to rounding.

Our separate financial information as of and for the years ended December 31, 2024 and 2023 included in this prospectus has been prepared in accordance with International Financial Reporting Standards as adopted in Korea, or Korean IFRS or K-IFRS. References in this prospectus to "separate" financial statements and information are to financial statements and information prepared on a non-consolidated basis. Unless specified otherwise, our financial and other information included in this prospectus is presented on a separate basis in accordance with Korean IFRS and does not include such information with respect to our subsidiaries. KDB Financial Group, or KDBFG, a financial holding company, and Korea Finance Corporation, or KoFC, a public policy financing vehicle and the parent company of KDBFG, both of which had originally been established by spinning off a portion of our assets, liabilities and equity in October 2009, merged with and into us on December 31, 2014.

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**USE OF PROCEEDS** 

Unless otherwise specified in the applicable prospectus supplement, we will use the net proceeds from the sale of the securities for our general operations.

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##### [**Table of Contents**](#toc)
**THE KOREA DEVELOPMENT BANK** 

**Overview** 

We were established in 1954 as a government-owned financial institution pursuant to The Korea Development Bank Act, as amended, or the KDB Act. Since our establishment, we have been the leading bank in the Republic with respect to the provision of long-term financing for projects designed to assist the nation's economic growth and development. The Government directly owns all of our paid-in capital. Our registered office is located at 14, Eunhaeng-ro, Yeongdeungpo-gu, Seoul, The Republic of Korea. Our primary purpose, as stated in the KDB Act, the KDB Decree and our Articles of Incorporation, is to "furnish funds in order to expedite the development of the national economy." We make loans available to major industries for equipment, capital investment and the development of high technology, as well as for working capital.

As of December 31, 2024, we had W212,382.5 billion of loans outstanding (including loans, call loans, domestic usance, bills of exchange bought, local letters of credit negotiation and loan-type suspense accounts pursuant to the applicable guidelines without adjusting for allowance for loan losses, present value discounts and deferred loan fees), W339,221.1 billion of total assets and W42,924.9 billion of total equity, compared to W203,067.3 billion of loans outstanding, W317,065.8 billion of total assets and W39,430.5 billion of total equity as of December 31, 2023. In 2024, we recorded interest income of W12,105.9 billion, interest expense of W10,987.8 billion and net income of W2,007.2 billion, compared to W11,489.0 billion of interest income, W9,927.5 billion of interest expense and W3,027.1 billion of net income in 2023. See "—Selected Financial Statement Data."

Currently, the Government directly holds 100% of our paid-in capital. In addition to contributions to our capital, the Government provides direct financial support for our financing activities, in the form of loans or guarantees. The Government has the power to elect or dismiss our Chairman and Chief Executive Officer, members of our Board of Directors and Auditor. The Government may dismiss each such person if he/she (i) violates the KDB Act, an order issued thereunder, or the Articles of Incorporation or (ii) is unable to perform his/her duties due to physical or mental disability. The Chairman may be dismissed by the President of the Republic at the recommendation of the chairman of the Financial Services Commission. The Chief Executive Officer and members of the Board of Directors may be dismissed by the Financial Services Commission at the recommendation of the Chairman and the Auditor may be dismissed by the Financial Services Commission. There is no prescribed timeline for dismissal. Pursuant to the KDB Act, the Financial Services Commission has supervisory power and authority over matters relating to our general business including, but not limited to, capital adequacy and managerial soundness.

The Government supports our operations pursuant to Article 32 of the KDB Act. Article 32 provides that "the annual net losses of the Korea Development Bank shall be offset each year by the reserve, and if the reserve be insufficient, the deficit shall be replenished by the Government." As a result of the KDB Act, the Government is generally responsible for our operations and is legally obligated to replenish any deficit that arises if our reserve, consisting of our surplus and capital surplus items, is insufficient to cover our annual net losses. In light of the above, if we had insufficient funds to make any payment under any of our obligations, including the debt securities and guarantees covered by this prospectus, the Government would take appropriate steps, such as by making a capital contribution, by allocating funds or by taking other action, to enable us to make such payment when due. The provisions of Article 32 do not, however, constitute a direct guarantee by the Government of our obligations under the debt securities or the guarantees, and the provisions of the KDB Act, including Article 32, may be amended at any time by action of the National Assembly.

In January 1998, the Government amended the KDB Act to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• subordinate our borrowings from the Government to other indebtedness incurred in our operations;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• allow the Government to offset any deficit that arises if our reserve fails to cover our annual net losses by
transferring Government-owned property, including securities held by the Government, to us; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• allow direct injections of capital by the Government without prior approval of the National Assembly.

The Government amended the KDB Act in May 1999 and the KDB Decree in March 2000, to allow the Financial Services Commission to supervise and regulate us in terms of capital adequacy and managerial soundness.

In March 2002, the Government amended the KDB Act to enable us, among other things, to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• obtain low-cost funds from The Bank of Korea and from the issuance of
debt securities (in addition to already permitted industrial finance bonds), which may be used for increased levels of lending to small- and medium-sized enterprises;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• broaden the scope of borrowers to which we may extend working capital loans to include companies in the
manufacturing industry, enterprises which are "closely related" to enhancing the corporate competitiveness of the manufacturing industry and leading-edge high-tech companies; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• extend credits to mergers and acquisitions projects intended to facilitate corporate restructuring efforts.

In July 2005 and May 2009, the Government amended the KDB Act to provide that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) our annual net profit, after adequate allowances are made for depreciation in assets, shall be distributed as
follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) 40% or more of the net profit shall be credited to reserve, until the reserve amounts equal the total amount of paid-in capital; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any net profit remaining following the apportionment required under subparagraph (i) above shall be
distributed in accordance with the resolution of our Board of Directors and the approval of our shareholders;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) accumulated amounts in reserve may be capitalized after offsetting any net losses; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) any distributions made in accordance with paragraph (1)(ii) above may be in the form of cash dividends or
dividends in kind, provided that any distributions of dividends in kind must be made in accordance with applicable provisions of the KDB Decree.

In February 2008, the Government further amended the KDB Act, primarily to transfer most of the Government's supervisory authority over us from the Ministry of Economy and Finance to the Financial Services Commission.

In May 2009, the Government amended the KDB Act to facilitate our privatization. The amendment provided for, among others:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the preparation for the transformation of us from a special statutory entity into a corporation, including the
application of the Banking Act as applicable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the expansion of our operation scope that enables us to engage in commercial banking activities, including retail
banking (which was subsequently adjusted due to a change in the Government's decision to halt its plan for our privatization and to consolidate and strengthen our public financing role, utilizing our rich experience and expertise in public
policy financing);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the provision of government guarantees for our mid- to long-term foreign currency debt outstanding at the time of
initial sale of the Government's stake in KDBFG (subject to the National Assembly's authorization of the Government guarantee amount) and possible guarantees for our foreign currency debt incurred for the refinancing of such mid- to
long-term foreign currency debt with the government guarantee during the period when the Government owns more than 50% of our shares; and

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##### [**Table of Contents**](#toc)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the establishment of KDBFG and KoFC and application of the Financial Holding Company Act to KDBFG.

In May 2014, the Government and the National Assembly amended the KDB Act to streamline the financial policy roles among Government-owned banks and financial corporations in order to better respond systematically to rapidly changing domestic and international economic conditions by merging KDBFG and KoFC into us. The amended KDB Act provides, among others, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Government will halt its plan for our privatization;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• public policy financing will be consolidated and strengthened through the newly merged entity;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we will comprehensively succeed to the properties, rights and obligations of KDBFG and KoFC upon the consummation
of the merger;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the bonds issued by KDBFG and the policy bank bonds issued by the KoFC shall be deemed as the industrial
financial bonds issued by us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the business engaged in by KoFC in accordance with the Korea Finance Corporation Act or other laws and decrees
will be continuously performed by us; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the repayment of the principal of and interest on foreign currency debt (with an original maturity of one year or
more at the time of issuance) incurred by KoFC and us before this amended KDB Act comes into force shall be guaranteed by the Government at the time of initial sale by the Government of its equity interest in us, subject to the approval by the
National Assembly.

In May 2020, the Government amended the KDB Act in order to provide statutory grounds for the establishment of the Key Industry Stabilization Fund to support businesses in certain key industries that face financial difficulties resulting from the COVID-19 pandemic. In accordance with the terms of its formation, all operations under the fund are currently scheduled to terminate by the end of 2025, at which point all rights and obligations under the fund will be transferred to the Government.

The Acting Minister of Economy and Finance of the Republic has, on behalf of the Republic, signed the registration statement of which this prospectus forms a part.

**Capitalization** 

As of December 31, 2024, our authorized capital was W30,000 billion and our capitalization was as follows:

---

| | | |
|:---|:---|:---|
|  | **As of December 31,<br>2024<sup>(1)</sup>** | **As of December 31,<br>2024<sup>(1)</sup>** |
|  | **(billions of Won)** | **(billions of Won)** |
|  Long-term debt<sup>(2)</sup>: |  |  |
|  Won currency borrowings | W | 4358.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Industrial finance bonds |  | 162692.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign currency borrowings |  | 5615.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total long-term debt |  | 172665.8<sup>(3)(4)</sup> |
|  Capital: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Paid-in capital |  | 26316.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital surplus |  | 2457.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retained earnings<sup>(5)</sup> |  | 12914.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accumulated other comprehensive income |  | 1236.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total capital |  | 42924.9 |
|  Total capitalization | W | 215590.7 |

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##### [**Table of Contents**](#toc)
(1) Except as disclosed in this prospectus, there has been no material adverse change in our capitalization since
December 31, 2024.

(2) Defined as debt that has a maturity at issuance of one year or more.

(3) We have translated borrowings in foreign currencies into Won at the rate of W 1,470.0 to
US$1.00, which was the market average exchange rate, as announced by the Seoul Monetary Brokerage Services Ltd., on December 31, 2024.

(4) As of December 31, 2024, we had confirmed acceptances and guarantees totaling W 12,355.3 billion under outstanding guarantees issued on behalf of our clients. See "—Financial Statements and the Auditors—Notes to Separate Financial Statements of December 31, 2024 and 2023—Note
39."

(5) Includes regulatory reserve for credit losses of W 77.6 billion as of December 31,
2024. If our allowance for credit losses is deemed insufficient for regulatory purposes, we compensate for the difference by recording a regulatory reserve for credit losses, which is shown as a separate item included in retained earnings. See
"—Financial Statements and the Auditors—Notes to Separate Financial Statements of December 31, 2024 and 2023—Note 23."

**Business** 

***Purpose and Authority***

Since our establishment, we have been the leading bank in the Republic in providing long-term financing for projects designed to assist the nation's economic growth and development.

Under the KDB Act, the KDB Decree and our Articles of Incorporation, our primary purpose is to "contribute to the sound development of the financial industry and the national economy by supplying and managing funds necessary for the development and promotion of industries, expansion of social infrastructure, development of regions, stabilization of the financial markets and facilitation of sustainable growth." Since we serve the public policy objectives of the Government, we do not seek to maximize profits. We do, however, strive to maintain a level of profitability to strengthen our equity base and support growth in the volume of our business.

Under the KDB Act, we may:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• carry out activities necessary to accomplish the expansion of the national economy, subject to the approval of
the Financial Services Commission;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• provide loans or discount notes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• subscribe to, underwrite or invest in securities, subject to certain restrictions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• guarantee or assume indebtedness;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• raise funds by accepting demand deposits and time and savings deposits from the general public, issuing
securities, borrowing from the Government, The Bank of Korea or other financial institutions, and borrowing from lenders overseas;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• execute foreign exchange transactions, including currency and interest swap transactions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• provide planning, management, research and other support services at the request of the Government, public
bodies, financial institutions or enterprises;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• manage and operate various funds established pursuant to Government-led initiatives; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• carry out other businesses incidental to the foregoing (subject to the approval of the Financial Services
Commission).

***Government Support and Supervision***

The Government owns directly all of our paid-in capital. Since our establishment, the Government has made capital contributions not only in cash but also in the form of shares of common stock of Government-affiliated entities. Recent examples include the Government's contributions to our capital of (i) W451 billion in cash and W1,652 billion in cash in April 2020 and July 2020, respectively, (ii) W510 billion in cash and W611 billion in

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##### [**Table of Contents**](#toc)
cash in January 2021 and May 2021, respectively, (iii) W392 billion in cash in March 2022, W308 billion in cash in July 2022 and W565 billion in the form of shares of common stock of Korea Land and Housing Corporation in December 2022, (iv) W435 billion in the form of shares of common stock of Korea Land and Housing Corporation in March 2023, W120 billion in cash in May 2023 and W220 billion in cash in October 2023, and (v) W2 trillion in the form of shares of common stock of Korea Land and Housing Corporation in March 2024, W84 billion in cash in April 2024, W121 billion in cash in June 2024 and W185 billion in cash in July 2024.

Taking into account these capital contributions, as of December 31, 2024, our total paid-in capital was W26,316.6 billion. See "—Financial Statements and the Auditors—Notes to Separate Financial Statements of December 31, 2024 and 2023—Note 23." The Government contributed W65 billion in cash in March 2025 and W156 billion in cash in April 2025 to our capital.

In addition to capital contributions, the Government directly supports our financing activities by:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• lending us funds to on-lend;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• allowing us to administer Government loans made from a range of special Government funds;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• allowing us to administer some of The Bank of Korea's surplus foreign exchange holdings; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• allowing us to receive credit from The Bank of Korea.

The Government also supports our operations pursuant to Articles 31 and 32 of the KDB Act. Article 31 provides that "40% or more of the annual net profit of the Korea Development Bank shall be transferred to reserve, until the reserve amounts equal the total amount of authorized capital" and that accumulated amounts in reserve may be capitalized. Article 32 provides that "the net losses of the Korea Development Bank shall be offset each fiscal year by the reserve, and if the reserve be insufficient, the deficit shall be replenished by the Government."

As a result of the KDB Act, the Government is generally responsible for our operations and is legally obligated to replenish any deficit that arises if our reserve, consisting of our surplus and capital surplus items, is insufficient to cover our annual net losses. In light of the above, if we had insufficient funds to make any payment under any of our obligations, including the debt securities and guarantees covered by this prospectus, the Government would take appropriate steps, such as by making a capital contribution, by allocating funds or by taking other action, to enable us to make such payment when due. The provisions of Article 32 do not, however, constitute a direct guarantee by the Government of our obligations under the debt securities or the guarantees, and the provisions of the KDB Act, including Article 32, may be amended at any time by action of the National Assembly.

The Government closely supervises our operations in the following ways:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Government has the power to elect or dismiss our Chairman and Chief Executive Officer, members of our Board
of Directors and Auditor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• within three months after the end of each fiscal year, we must submit our financial statements for the fiscal
year to the Financial Services Commission;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Financial Services Commission has broad authority to require reports from us on any matter and to examine our
books, records and other documents. On the basis of the reports and examinations, the Financial Services Commission may issue any orders deemed necessary to enforce the KDB Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Financial Services Commission must approve our operating manual, which sets out the guidelines for all
principal operating matters;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Financial Services Commission may supervise our operations to ensure managerial soundness based upon the KDB
Decree and the Bank Supervisory Regulations of the Financial Services Commission and may issue orders deemed necessary for such supervision; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we may amend our Articles of Incorporation only with the approval of the Financial Services Commission.

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We have had our annual financial statements for years commencing 1998 audited by an external auditor. See "—Financial Statements and the Auditors" and "Experts."

Pursuant to our most recently approved program of operations, we expect to support the reform and restructuring of the Republic's economic and industrial structure, including financing of promising small- and medium-sized enterprises, providing export finance and encouraging investments in infrastructure necessary to promote consumer demand and industrial reorganization.

We also pay dividends on a regular basis to the Government. For fiscal years 2022, 2023 and 2024, we paid to the Government dividends amounting to W164.7 billion, W878.1 billion and W758.7 billion, respectively.

**Selected Financial Statement Data** 

Unless specified otherwise, the information provided below is stated on a separate basis in accordance with Korean IFRS.

***Consolidated Financial Statement Data***

The following table presents selected statements of financial position data regarding our assets, liabilities and shareholders' equity on a consolidated basis as of December 31, 2024 and 2023, which have been derived from our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023.

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2023** | **2023** | **2024** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  **Statements of Financial Position Data** |  |  |  |
|  Total Loans (measured at amortized cost)<sup>(1)</sup> | W | 217196.1 | 227453.1 |
|  Total Borrowings<sup>(2)</sup> |  | 266741.1 | 281379.7 |
|  Total Assets |  | 347534.5<sup>(3)</sup> | 372581.1 |
|  Total Liabilities |  | 308106.9<sup>(3)</sup> | 328571.4 |
|  Equity |  | 39427.5<sup>(3)</sup> | 44009.7 |

---

(1) Gross amount, which includes loans for facility development, loans for working capital, loans for households,
inter-bank loans, private loans, off-shore loan receivables, loans borrowed from overseas financial institutions, bills bought in foreign currencies, advance payments on acceptances and guarantees and other
loans without adjusting for allowance for loan losses, present value discounts and deferred loan fees.

(2) Total Borrowings include deposits, financial liabilities measured at fair value through profit or loss,
borrowings and debentures.

(3) Our equity interest in HMM Company Limited was initially classified as assets held for sale in our consolidated
financial statements as of and for the years ended December 31, 2023 and 2022 following the designation of a preferred bidder for the sale of HMM Company Limited in December 2023. However, upon the termination of negotiations in February 2024,
our equity interest in HMM Company Limited was reclassified as an investment in an associate, with the reclassification being applied retroactively. See Note 2(6) of the notes to our consolidated financial statements as of and for the years ended
December 31, 2024 and 2023, which will be available on our website.

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##### [**Table of Contents**](#toc)
Our selected income statement data included in the following table have been derived from our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023.

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended<br>December 31,** | **Year Ended<br>December 31,** | **Year Ended<br>December 31,** |
|  | **2023** | **2023** | **2024** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  **Income Statement Data** |  |  |  |
|  Total Interest Income | W | 12831.8 | 13555.8 |
|  Total Interest Expense |  | 10396.2 | 11537.8 |
|  Net Interest Income |  | 2435.6 | 2018.0 |
|  Operating Income |  | 1472.8 | 2207.6 |
|  Non-operating Income (Expense) |  | (314.4)<sup>(1)</sup> | 465.0 |
|  Profit before Income Taxes |  | 1158.3<sup>(1)</sup> | 2672.6 |
|  Income Tax Expense (Benefit) |  | (510.3)<sup>(1)</sup> | 525.9 |
|  Profit from discontinued operations |  | 2328.1<sup>(2)</sup> |  |
|  Net Income |  | 3996.7<sup>(1)</sup> | 2146.7 |

---

(1) Our equity interest in HMM Company Limited was initially classified as assets held for sale in our consolidated
financial statements as of and for the years ended December 31, 2023 and 2022 following the designation of a preferred bidder for the sale of HMM Company Limited in December 2023. However, upon the termination of negotiations in February 2024,
our equity interest in HMM Company Limited was reclassified as an investment in an associate, with the reclassification being applied retroactively. See Note 2(6) of the notes to our consolidated financial statements as of and for the years ended
December 31, 2024 and 2023, which will be available on our website.

(2) In September 2022, Hanwha Group entered into a conditional investment agreement with Daewoo
Shipbuilding & Marine Engineering Co., Ltd., or DSME (now Hanwha Ocean Co., Ltd.) to acquire a 49.3% equity interest in DSME through a capital increase, provided that certain conditions were met. Following such agreement, we reclassified
our gains related to DSME as profit from discontinued operations. In May 2023, pursuant to such agreement, Hanwha Group completed the acquisition of newly issued shares of DSME and became its largest shareholder, and as of December 31, 2024,
the shares of DSME owned by us were classified as investments in associates. For more information, see Note 16 of the notes to our consolidated financial statements as of and for the years ended December 31, 2024 and 2023, which will be
available on our website.

***Separate Financial Statement Data***

The following tables present selected separate financial information as of and for the years ended December 31, 2024 and 2023, which has been derived from our audited separate financial statements as of and for the years ended December 31, 2024 and 2023 included in this prospectus. You should read the following financial statement data together with the financial statements and notes included in this prospectus.

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| | | | |
|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2023** | **2023** | **2024** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  **Statements of Financial Position Data** |  |  |  |
|  Total Loans (measured at amortized cost)<sup>(1)</sup> | W | 203067.3 | 212382.5 |
|  Total Borrowings<sup>(2)</sup> |  | 252497.3 | 266322.6 |
|  Total Assets |  | 317065.8<sup>(3)</sup> | 339221.1 |
|  Total Liabilities |  | 277635.2<sup>(3)</sup> | 296296.2 |
|  Equity |  | 39430.5<sup>(3)</sup> | 42924.9 |

---

(1) Gross amount, which includes loans for facility development, loans for working capital, loans for households,
inter-bank loans, private loans, off-shore loan receivables, loans borrowed from overseas financial institutions, bills bought in foreign currencies, advance payments on acceptances and guarantees and other
loans without adjusting for allowance for loan losses, present value discounts and deferred loan fees.

(2) Total Borrowings include deposits, financial liabilities measured at fair value through profit or loss,
borrowings and debentures.

(3) Our equity interest in HMM Company Limited was initially classified as assets held for sale in our consolidated
financial statements as of and for the years ended December 31, 2023 and 2022 following the designation of a preferred bidder for the sale of HMM Company Limited in December 2023. However, upon the termination of negotiations in February 2024,
our equity interest in HMM Company Limited was reclassified as an investment in an associate, with the reclassification being applied retroactively. See "—Financial Statements and the Auditors—Notes to Separate Financial Statements
of December 31, 2024 and 2023—Note 2(6)."

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As of December 31, 2024, our total assets increased by 7.0% to W339,221.1 billion from W317,065.8 billion as of December 31, 2023, primarily due to an increase in loans measured at amortized cost to W209,481.4 billion as of December 31, 2024 from W199,981.8 billion as of December 31, 2023, an increase in derivative financial assets to W13,915.3 billion as of December 31, 2024 from W7,383.3 billion as of December 31, 2023, an increase in cash and due from banks to W12,995.5 billion as of December 31, 2024 from W8,659.8 billion as of December 31, 2023, an increase in investments in subsidiaries and associates to W33,263.3 billion as of December 31, 2024 from W30,803.0 billion as of December 31, 2023 and an increase in securities measured at fair value through profit or loss to W18,418.8 billion as of December 31, 2024 from W16,058.6 billion as of December 31, 2023. The effects of such increases were partially offset by a decrease in other assets to W8,056.5 billion as of December 31, 2024 from W10,175.8 billion as of December 31, 2023 and a decrease in securities measured at fair value through other comprehensive income to W32,760.2 billion as of December 31, 2024 from W33,888.1 billion as of December 31, 2023.

As of December 31, 2024, our total liabilities increased by 6.7% to W296,296.2 billion from W277,635.2 billion as of December 31, 2023, primarily due to an increase in debentures to W165,102.3 billion as of December 31, 2024 from W156,933.9 billion as of December 31, 2023, an increase in derivative financial liabilities to W14,873.9 billion as of December 31, 2024 from W7,654.9 billion as of December 31, 2023 and an increase in borrowings to W32,730.5 billion as of December 31, 2024 from W27,745.6 billion as of December 31, 2023. The effects of such increases were partially offset by a decrease in other liabilities to W9,983.5 billion as of December 31, 2024 from W12,100.4 billion as of December 31, 2023.

As of December 31, 2024, our total equity increased by 8.9% to W42,924.9 billion from W39,430.5 billion as of December 31, 2023, primarily due to an increase in issued capital to W26,316.6 billion as of December 31, 2024 from W23,926.6 billion as of December 31, 2023 and an increase in retained earnings to W12,914.6 billion as of December 31, 2024 from W10,876.9 billion as of December 31, 2023. The effects of such increases were partially offset by a decrease in accumulated other comprehensive income to W1,236.7 billion as of December 31, 2024 from W2,158.4 billion as of December 31, 2023.

Our selected income statement data included in the following table have been derived from our audited separate financial statements as of and for the years ended December 31, 2024 and 2023 included in this prospectus.

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| | | | |
|:---|:---|:---|:---|
|  | **Year Ended<br>December 31,** | **Year Ended<br>December 31,** | **Year Ended<br>December 31,** |
|  | **2023** | **2023** | **2024** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  **Income Statement Data** |  |  |  |
|  Total Interest Income | W | 11489.0 | 12105.9 |
|  Total Interest Expense |  | 9927.5 | 10987.8 |
|  Net Interest Income |  | 1561.5 | 1118.1 |
|  Operating Income |  | 2996.9 | 2294.1 |
|  Profit before Income Taxes |  | 3965.7<sup>(1)</sup> | 2440.8 |
|  Income Tax Expense |  | 938.6<sup>(1)</sup> | 433.7 |
|  Net Income |  | 3027.1<sup>(1)</sup> | 2007.2 |

---

(1) Our equity interest in HMM Company Limited was initially classified as assets held for sale in our consolidated
financial statements as of and for the years ended December 31, 2023 and 2022 following the designation of a preferred bidder for the sale of HMM Company Limited in December 2023. However, upon the termination of negotiations in February 2024,
our equity interest in HMM Company Limited was reclassified as an investment in an associate, with the reclassification being applied retroactively. See "—Financial Statements and the Auditors—Notes to Separate Financial Statements
of December 31, 2024 and 2023—Note 2(6)."

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***2024***

We had net income of W2,007.2 billion in 2024 compared to W3,027.1 billion in 2023, on a separate basis. The principal factors for the decrease in net income included:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a change in net gain (loss) on derivatives to a net loss of W 829.8 billion in 2024 from a
net gain of W 1.3 billion in 2023, primarily due to a change in net gain (loss) on hedging purpose derivatives to a net loss in 2024 from a net gain in 2023, which in turn resulted mainly from foreign currency fluctuations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a significant decrease in reversal of impairment loss on investments in subsidiaries and associates to W 160.9 billion in 2024 from W 972.4 billion in 2023, primarily due to an increase in impairment loss on our investment in HMM Company Limited; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a significant decrease in reversal of provisions for credit losses to W 244.1 billion in
2024 from W 802.6 billion in 2023, primarily due to a provision of our loan loss allowances in 2024, which was in turn primarily due to a decrease in the reversal of provisions for loan loss allowance for Hanwha Ocean Co., Ltd.

The above factors were offset in significant part by the following factors:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an increase in net foreign currency transaction gain to W 864.9 billion in 2024 from W 302.4 billion in 2023, primarily due to foreign currency fluctuations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a decrease in income tax expense to W 433.7 billion in 2024 from W 938.6 billion in 2023, primarily due to a decrease in profit before income taxes to W 2,440.8 billion in 2024 from W 3,965.7 billion in 2023.

***2023***

We had net income of W3,027.1 billion in 2023 compared to W465.0 billion in 2022, on a separate basis. The principal factors for the increase in net income included:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a reversal of impairment loss on investments in subsidiaries and associates of W 972.4 billion in 2023 compared to an impairment loss on such investments of W 1,168.6 billion in 2022, primarily due to an increase in the recoverable amount of our investment in Hanwha Ocean Co., Ltd.,
resulting from an increase in the fair value of such investment following its acquisition by the Hanwha Group;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a reversal of provisions for credit losses of W 802.6 billion in 2023 compared to provisions
for credit losses of W 260.4 billion in 2022, primarily due to a reversal of our loan loss allowances in 2023, which was in turn primarily due to a decrease in our expected credit losses resulting from a general improvement in
the credit ratings of companies in the Korean shipbuilding sector to which we provided loans, including Hanwha Ocean Co., Ltd., K Shipbuilding Co., Ltd. (formerly, STX Offshore & Shipbuilding) and Daehan Shipbuilding Co., Ltd.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a change in net foreign currency transaction gain (loss) to a net gain of W 302.4 billion in
2023 from a net loss of W 300.9 billion in 2022, which was primarily due to foreign currency fluctuations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a change in net gain (loss) on securities measured at fair value through profit or loss to a net gain of W 518.8 billion in 2023 from a net loss of W 39.4 billion in 2022, which was primarily due to the stabilization of interest rate levels in 2023 compared to 2022.

The above factors were partially offset by the following factors:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an increase in income tax expense to W 938.6 billion in 2023 from W 127.7 billion in 2022, primarily due to an increase in profit before income taxes to W 3,965.7 billion in 2023 from W 592.7 billion in 2022;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a change to a net loss on financial liabilities measured at fair value through profit or loss of W 148.1 billion in 2023 from a net gain of W 465.1 billion in 2022, primarily due to fluctuations in the interest rate levels of structured industrial finance debentures and structured deposits; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a decrease in net gain on derivatives to W 1.3 billion in 2023 from W 121.4 billion in 2022, primarily due to a change in net gain (loss) on fair value hedged items to a net loss in 2023 from a net gain in 2022, resulting from foreign currency fluctuations.

***Allowances for Loan Losses and Loans in Arrears***

We establish allowances for losses from problem loans, including guarantees and other extensions of credit, based on the length of the delinquent periods and the nature of the loans, including guarantees and other extensions of credit. Under Korean IFRS 1109, we establish allowances for credit losses based on expected credit losses instead of incurred losses by assessing changes in expected credit losses and recognizing such changes as impairment loss (or reversal of impairment loss) in profit or loss. The allowance required to be established with respect to a loan or receivable is the amount of the expected 12-month credit loss or the expected lifetime credit loss for the applicable loan or receivable, according to three stages of credit risk deterioration since initial recognition.

As of December 31, 2024, we established allowances of W2,926.0 billion for loan losses, which was 5.6% lower than the allowances as of December 31, 2023 of W3,100.0 billion, resulting from our disposals of non-performing loans and participations in debt-for-equity swap transactions. Allowances for loan losses under Korean IFRS are recorded for loans based on expected credit losses, depending on whether there has been a significant increase in credit risk or a credit impairment since initial recognition and, if our allowances for loan losses are deemed insufficient for regulatory purposes, we compensate for the difference by recording a regulatory reserve for loan losses within retained earnings. See "—Financial Statements and the Auditors—Notes to Separate Financial Statements of December 31, 2024 and 2023—Notes 3(27), 9(1), 23(4) and 23(5)."

Certain of our customers have restructured loans with their creditor banks. As of December 31, 2024, we have provided loans of W717.0 billion for companies under workout, court receivership, court mediation and other restructuring procedures. In addition, as of such date, we held equity securities of such companies in the amount of W68.8 billion, acquired through debt-for-equity swap transactions. As of December 31, 2024, we had established allowances of W367.4 billion for loan losses with respect to such companies. We cannot assure you that actual results of the credit loss from the loans to these customers will not exceed the allowances established.

The following table provides information on our loan loss allowances.

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| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  |  | **As of December 31, 2023<sup>(1)</sup>** | **As of December 31, 2023<sup>(1)</sup>** | **As of December 31, 2023<sup>(1)</sup>** | **As of December 31, 2023<sup>(1)</sup>** | **As of December 31, 2024<sup>(1)</sup>** | **As of December 31, 2024<sup>(1)</sup>** | **As of December 31, 2024<sup>(1)</sup>** | **As of December 31, 2024<sup>(1)</sup>** |
|  |  | **Loan<br>Amount** | **Loan<br>Amount** | **Loan<br>Loss<br>Allowances** | **Loan<br>Loss<br>Allowances** | **Loan<br>Amount** | **Loan<br>Amount** | **Loan<br>Loss<br>Allowances** | **Loan<br>Loss<br>Allowances** |
|  |  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Loan Classification | Normal<sup>(2)</sup> | W | 201239.1 | W | 2127.3 | W | 210727.5 | W | 2186.3 |
|  | Precautionary |  | 412.3 |  | 77.1 |  | 551.5 |  | 100.0 |
|  | Substandard |  | 624.1 |  | 223.6 |  | 566.8 |  | 225.6 |
|  | Doubtful |  | 163.6 |  | 139.6 |  | 177.1 |  | 107.3 |
|  | Expected Loss |  | 628.2 |  | 532.4 |  | 359.7 |  | 306.8 |
|  | Total | W | 203067.3 | W | 3100.0 | W | 212382.5 | W | 2926.0 |

---

(1) These figures include loans for facility development, loans for working capital, loans for households,
inter-bank loans, private loans, off-shore loan receivables, loans borrowed from overseas financial institutions, bills bought in foreign currencies, advance payments on acceptances and guarantees and other
loans.

(2) Includes loans guaranteed by the Government. Under Korean IFRS, we establish loan loss allowances for all loans
including loans guaranteed by the Government.

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As of December 31, 2024, our non-performing loans totaled W1,103.5 billion, representing 0.5% of our outstanding loans as of such date. Non-performing loans are defined as loans that are classified as substandard or below. On December 31, 2024, our legal reserve was W3,725.5 billion, representing 1.8% of our outstanding loans as of such date.

***Loans to Financially Troubled Companies***

We have credit exposure to a number of financially troubled Korean companies, including HMM Company Limited (formerly, Hyundai Merchant Marine Co., Ltd.), HJ Shipbuilding & Construction Co., Ltd. (formerly, Hanjin Heavy Industries and Construction Co., Ltd.), Daehan Shipbuilding Co., Ltd., K Shipbuilding Co., Ltd. (formerly, STX Offshore & Shipbuilding), GM Korea Company and Taeyoung E&C. As of December 31, 2024, our credit extended to these companies totaled W9,966.1 billion, accounting for 2.9% of our total assets as of such date.

The following table shows the changes in credit exposure (including loans, guarantees and equity investments classified as substandard or below) extended to these companies as of the dates indicated:

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| | | | | |
|:---|:---|:---|:---|:---|
| **Company** | **As of December 31,** | **As of December 31,** | **As of December 31,** | **Primary Reason for Change** |
| **Company** | **2023** | **2023** | **2024** | **Primary Reason for Change** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |  |
|  HMM Company Limited |  | 6549.4 | 6595.1 | Increase due to the reclassification of shares from assets held for sale to investments in associates |
|  HJ Shipbuilding & Construction |  | 1195.7 | 966.8 | Decrease due to decreases in working capital loans and refund guarantees |
|  Daehan Shipbuilding |  | 977.2 | 1067.3 | Increase due to an increase in refund guarantees |
|  K Shipbuilding |  | 645.2 | 728.5 | Increase due to an increase in refund guarantees |
|  GM Korea Company |  | 455.9 | 474.7 | Increase due to an increase in the value of stocks |
|  Taeyoung E&C |  | 138.0 | 133.7 | Decrease due to a reduction in the value of stocks in connection with debt-for-equity swaps |
|  Total | W | 9961.4 | 9966.1 |  |

---

As of December 31, 2024, we established allowances of W0.6 billion for HMM Company Limited, W133.3 billion for HJ Shipbuilding & Construction, W112.8 billion for Daehan Shipbuilding, W67.4 billion for K Shipbuilding, none for GM Korea Company and W17.9 billion for Taeyoung E&C.

In July 2016, HMM Company Limited executed a debt-to-equity swap with us and other creditors, as part of its continued restructuring led by us as its largest creditor, and affiliates of the Hyundai group reduced their shareholdings in HMM Company Limited, which resulted in us becoming the largest shareholder of HMM Company Limited. In October 2018, we injected W1 trillion in emergency aid into HMM Company Limited in order to normalize its operations by purchasing bonds with warrants and convertible bonds issued by HMM Company Limited. We also concurrently entered into an agreement to jointly manage HMM Company Limited together with Korea Ocean Business Corporation until December 2020, which was subsequently extended to January 2022. In June 2021, we exercised our right to convert W300 billion of our convertible bonds into 60 million common shares of HMM Company Limited. Following an improvement in the financial performance of HMM Company Limited, we ended our joint management of HMM Company Limited in January 2022, upon which Korea Ocean Business Corporation became its sole manager. We and Korea Ocean Business Corporation are each pursuing the sale of our respective equity shares in HMM Company Limited. In July 2023, we and Korea Ocean Business Corporation jointly announced a combined sale of an aggregate of approximately 38.9% of the equity interest in HMM Company Limited through a competitive bidding process. Although a consortium

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led by Harim Group was initially selected as the preferred bidder in December 2023, we concluded our negotiations with them in February 2024 upon failure to reach an agreement on certain commercial issues. In October 2023, we exercised our right to convert W200 billion of our convertible bonds into 40 million common shares of HMM Company Limited and exercised our stock purchase warrant tied to the bonds with warrants we had purchased previously and acquired 60 million common shares of HMM Company Limited. In May, June and October 2024, we exercised our right to convert an aggregate of W480 billion of our convertible bonds into an aggregate of 96 million common shares of HMM Company Limited. In April 2025, we exercised our right to convert W360 billion of our convertible bonds into 72 million common shares of HMM Company Limited, following which our equity stake in HMM Company Limited amounted to 36.02% as of April 30, 2025.

In January 2019, HJ Shipbuilding & Construction Philippines, a subsidiary of HJ Shipbuilding & Construction at Subic Bay in the Philippines, declared bankruptcy and filed for corporate rehabilitation with a regional trial court following its failure to comply with loan obligations to its Philippine lenders. In March 2019, creditors in Korea (including us) and lenders in the Philippines agreed on, and executed, a business normalization plan including a debt-to-equity swap and capital reduction for HJ Shipbuilding & Construction, as a result of which we became the largest shareholder of HJ Shipbuilding & Construction. In September 2021, creditors of HJ Shipbuilding & Construction (including us) sold a 66.85% interest in the company to a consortium led by Dongbu Corporation.

K Shipbuilding has faced financial difficulties for the past several years due to prolonged slowdowns in the Korean shipbuilding and shipping industries. K Shipbuilding, which had filed for court receivership in May 2016 and executed debt-to-equity swaps with their creditors (including us) in December 2016 under a rehabilitation plan through which we increased our equity interest to 43.9% and became its largest shareholder, exited court receivership in July 2017. In November 2020, we selected a consortium consisting of KH Investment and UAMCO., Ltd. as the preferred bidder for the sale of shares of K Shipbuilding. In July 2021, the consortium acquired a 97% interest in K Shipbuilding for W250 billion. In December 2021, we terminated our creditor management of K Shipbuilding, and in December 2022, sold all of our equity stake in K Shipbuilding.

In January 2024, Taeyoung Engineering & Construction Co., or Taeyoung E&C, commenced workout procedures, pursuant to which its creditors, including us, agreed to temporarily defer all of its debt payment obligations. Subsequently, we, as the lead creditor, worked together with external consultants to evaluate Taeyoung E&C's ability to maintain its business and repay its loans. In April 2024, we proposed a corporate improvement plan to restructure Taeyoung E&C based on such evaluation, which would involve debt-to-equity swaps and capital reductions, among others, and the creditors approved such corporate improvement plan, following which we entered into an agreement with Taeyoung E&C to implement such plan.

In 2024, we sold non-performing loans worth W387.4 billion to Hana F&I Co., Ltd.

Our large exposure to financially troubled companies in Korea means that we are also exposed to financial difficulties experienced by our borrowers as a result of, among other things, adverse economic conditions in Korea and globally, which could disrupt the business, activities and operations of many of our borrowers, which in turn could have an adverse impact on the ability of our borrowers to meet existing payment or other obligations to us. For example, the recent COVID-19 pandemic resulted in significant global and domestic economic and financial disruptions, and had an especially direct negative impact on certain of our borrowers, among them the airline industry, which required significant liquidity following a sharp decline in aircraft traffic and a dramatic increase in the number of suspended flights due to entry restrictions imposed by many countries in response to COVID-19 during the course of the pandemic.

In April 2020, we provided Asiana Airlines, a subsidiary of Kumho Asiana Group and the second-largest airline in Korea, with liquidity support in the aggregate amount of approximately W1.2 trillion, in the form of the provision of a credit line and an investment in its perpetual convertible bonds. Our decision to take such measure was largely driven by a need to address Asiana Airlines' financial difficulties resulting from the negative impact

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##### [**Table of Contents**](#toc)
of the COVID-19 pandemic on the airline industry, although we had previously provided Asiana Airlines with liquidity support in similar amount and form in 2019 as well with the aim of enhancing its financial condition. In the fourth quarter of 2020, we injected W0.3 trillion into Asiana Airlines through the Key Industry Stabilization Fund, which was established by the Government to support businesses in certain key industries that faced financial difficulties resulting from the COVID-19 pandemic, in order to normalize its operations following the cancellation of plans by a consortium led by HDC Hyundai Development to acquire Asiana Airlines. In November 2020, we signed an investment agreement with Hanjin KAL, the parent company of Korean Air Lines, to inject W800 billion (consisting of W500 billion through participation in a rights offering and W300 billion through purchase of exchangeable bonds) into Hanjin KAL in connection with Korean Air Lines' contemplated acquisition of a 63.9% stake in Asiana Airlines through a transaction valued at W1.8 trillion (the "Asiana Acquisition"). In December 2020, Asiana Airlines' shareholders approved a 3-to-1 share capital reduction plan, which was aimed at offsetting part of Asiana Airlines' deficits and improving its capital structure. The Asiana Acquisition was consummated in December 2024 after a lengthy approval process by the antitrust authorities of a number of jurisdictions, following which Asiana Airlines became a consolidated subsidiary of Korean Airlines Co., Ltd. As of December 31, 2024, our equity interest in Hanjin KAL amounted to approximately 10.6%. In February 2025, Asiana Airlines repaid all of its outstanding credit obligations to us, in the aggregate amount of approximately W1.4 trillion.

In addition, adverse economic conditions in Korea have prompted the Government in recent years to implement various emergency aid initiatives involving Korean banks, including us, to provide liquidity assistance to a range of financially troubled companies. Such initiatives include, among others, the provision of new loans to financially troubled companies, extension of maturity dates for existing loans and suspension of interest payment obligations for an extended period of time. For example, in February 2024, the Government announced a financial support program amounting to W75.9 trillion mostly aimed at helping small- and medium-sized enterprises overcome adverse economic conditions resulting from the prevailing high interest rate environment and expand their businesses into new industries. We provided W15.3 trillion toward this program as of December 31, 2024. Our participation in such Government-led initiatives may lead us to extend credit to financially troubled borrowers that we would not otherwise extend, or offer terms for such credit that we would not otherwise offer, in the absence of such initiatives. Furthermore, there is no guarantee that the financial condition and liquidity position of our financially troubled borrowers benefiting from such initiatives will improve sufficiently for them to service their debt on a timely basis, or at all. Accordingly, increases in our exposure to financially troubled borrowers resulting from such Government-led initiatives may have a material adverse effect on our financial condition and results of operations.

A deterioration in the financial condition of our borrowers, including those under workout, court receivership, court mediation or other restructuring procedures, could result in a deterioration in the quality of our loan portfolio. This, in turn, could result in an increase in delinquency ratios, increased charge-offs and higher provisioning, as well as an increase in impairment losses on such loans, which could have a material adverse impact on our business, financial condition or results of operations.

**Operations** 

***Loan Operations***

We mainly provide equipment capital loans, project loans and working capital loans to private Korean enterprises that undertake major industrial projects either directly or indirectly through on-lending. The loans generally cover over 50%, and in some cases as much as 100%, of the total project cost. Equipment capital loans include loans to major industries for development of high technology and for acquisition, improvement or repair of machinery and equipment. We disburse loan proceeds in installments to ensure that the borrower uses the loan for its intended purpose.

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Before approving a loan, we consider:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the economic benefits of the project to the Republic;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the extent to which the project serves priorities established by the Government's industrial policy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the project's operational feasibility;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the loan's and the project's profitability; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the quality of the borrower's management.

The interest rate we charge on our loans varies based on a number of factors, including the purpose of the loan, maturity date and the borrower's credit ratings. Certain loans bear interest at below market rates. Equipment capital loans generally have original maturities of three to five years, although we occasionally make equipment capital loans with longer maturities. Working capital loans usually mature within two years.

The Business Planning Department functions as our centralized policy-making and planning division with respect to our lending activities. The Business Planning Department formulates and revises our internal regulations on loan programs as well as setting basic lending guidelines.

We have multiple levels of loan approval authority, depending on the loan amount and other factors such as the availability of collateral or guarantee, debt repayment ability and business prospects. The Credit Review Committee, Division Credit Review Committee, Division Credit Review Sub-Committee, Credit Officer, Head of the Regional Head Office and General Manager each has authority to approve loans up to a specified amount. The amount differs depending on the type of loan and certain other factors, for example, whether a loan is collateralized or guaranteed.

Our overall risk management policy is set by the Risk Management Committee. For detailed information regarding our risk management policy and procedures, see "—Financial Statements and the Auditors—Notes to Separate Financial Statements of December 31, 2024 and 2023—Note 48."

The following table sets out, by currency and category of loan, our total outstanding loans:

**Loans<sup>(1)</sup>** 

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2023** | **2023** | **2024** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Equipment Capital Loans: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Domestic Currency | W | 61149.1 | 62063.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign Currency |  | 11861.3 | 12719.7 |
|  |  | 73010.4 | 74783.1 |
|  Working Capital Loans: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Domestic Currency<sup>(2)</sup> |  | 69497.3 | 68969.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign Currency |  | 17458.0 | 21931.6 |
|  |  | 86955.4 | 90901.1 |
|  Other Loans<sup>(3)</sup> |  | 43101.6 | 46698.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Loans | W | 203067.3 | 212382.5 |

---

(1) Includes loans extended to affiliates.

(2) Includes loans on households.

(3) Includes inter-bank loans, private loans, off-shore loan receivables,
loans borrowed from overseas financial institutions, bills bought in foreign currencies, advance payments on acceptances and guarantees and other loans.

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As of December 31, 2024, we had W212,382.5 billion in outstanding loans, which represents a 4.6% increase from W203,067.3 billion of outstanding loans as of December 31, 2023.

*Maturities of Outstanding Loans* 

The following table categorizes our outstanding equipment capital and working capital loans by their remaining maturities:

**Outstanding Equipment Capital and Working Capital Loans by Remaining Maturities<sup>(1)</sup>** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As % of<br>December 31, 2024<br>Total** |
|  | **2023** | **2023** | **2024** | **As % of<br>December 31, 2024<br>Total** |
|  | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** |
|  Loans with Remaining Maturities of One Year or Less | W | 69771.0 | 78640.4 | 47.5% |
|  Loans with Remaining Maturities of More Than One Year |  | 90194.7 | 87043.8 | 52.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | W | 159965.7 | 165684.2 | 100.0% |

---

(1) Includes loans extended to affiliates.

*Loans by Industrial Sector* 

The following table sets out the total amount of our outstanding equipment capital and working capital loans, categorized by industry sector:

**Outstanding Equipment Capital and Working Capital Loans by Industry Sector<sup>(1)</sup>** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As % of<br>December 31,<br>2024 Total** |
|  | **2023** | **2023** | **2024** | **2024** | **As % of<br>December 31,<br>2024 Total** |
|  | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** |
|  Manufacturing | W | 72985.3 | W | 76354.0 | 46.1% |
|  Banking and Insurance |  | 38223.0 |  | 40685.5 | 24.6 |
|  Transportation |  | 10493.9 |  | 10259.3 | 6.2 |
|  Public Administration |  | 539.4 |  | 745.9 | 0.5 |
|  Electric, Gas and Water Supply Industry |  | 5562.0 |  | 5689.7 | 3.4 |
|  Others<sup>(2)</sup> |  | 32162.2 |  | 31949.8 | 19.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | W | 159965.7 | W | 165684.2 | 100.0% |
|  Percentage increase (decrease) from previous period |  | 1.5% |  | 3.6% |  |

---

(1) Includes loans extended to affiliates.

(2) Includes wholesale and retail trade, real estate and leasing, and construction.

Industrial Bank of Korea was our single largest borrower as of December 31, 2024, accounting for 4.1% of our outstanding equipment capital and working capital loans. As of December 31, 2024, our five largest borrowers and 20 largest borrowers accounted for 10.2% and 20.1%, respectively, of our outstanding equipment capital and working capital loans.

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The following table breaks down the equipment capital and working capital loans to our 20 largest borrowers outstanding as of December 31, 2024 by industry sector:

**20 Largest Borrowers by Industry Sector** 

---

| | |
|:---|:---|
|  | **As % of December 31, 2024<br>Total Outstanding Equipment<br>Capital and Working Capital Loans<br>to Our 20 Largest Borrowers** |
|  Manufacturing | 36.4% |
|  Banking and Insurance | 47.9 |
|  Transportation | 7.7 |
|  Electric, Gas and Water Supply Industry | 4.4 |
|  Others<sup>(1)</sup> | 3.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | 100.0% |

---

(1) Includes wholesale and retail trade, real estate and leasing, and construction.

The following table categorizes the new loans made by us by industry sector:

**New Loans by Industry Sector** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** | **Year Ended December 31,** | **As % of Year<br>Ended<br>December 31, 2024**<br>**Total** |
|  | **2023** | **2023** | **2024** | **As % of Year<br>Ended<br>December 31, 2024**<br>**Total** |
|  | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** |
|  Manufacturing | W | 40217.9 | 41700.8 | 52.8% |
|  Banking and Insurance |  | 17283.5 | 13487.1 | 17.1 |
|  Transportation |  | 4249.5 | 4033.8 | 5.1 |
|  Electric, Gas and Water Supply Industry |  | 2752.8 | 3394.9 | 4.3 |
|  Public Administration |  | 163.9 | 258.3 | 0.3 |
|  Others<sup>(1)</sup> |  | 15940.9 | 16170.3 | 20.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | W | 80608.5 | 79045.2 | 100.0 |
|  Percentage increase (decrease) from previous period |  | 4.0% | (1.9)% |  |

---

(1) Includes wholesale and retail trade, real estate and leasing, and construction.

*Loans by Categories* 

In addition to dividing our loans into equipment capital and working capital loans, we classify loans into several groupings, the most important being:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• industrial fund loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• on-lending loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• foreign currency loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• local currency loans denominated in foreign currencies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• offshore loans in foreign countries; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• government fund loans.

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The following table sets out equipment capital and working capital loans by categories as of December 31, 2024:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Equipment**<br>**Capital Loans<sup>(1)</sup>** | **Equipment**<br>**Capital Loans<sup>(1)</sup>** | **Equipment**<br>**Capital Loans<sup>(1)</sup>** | **Working**<br>**Capital Loans<sup>(1)</sup>** | **Working**<br>**Capital Loans<sup>(1)</sup>** | **Working**<br>**Capital Loans<sup>(1)</sup>** |
|  | **As of<br>December 31,<br>2024** | **As of<br>December 31,<br>2024** | **%** | **As of<br>December 31,<br>2024** | **As of<br>December 31,<br>2024** | **%** |
|  | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** | **(billions of Won, except percentages)** |
|  Industrial fund loans | W | 56651.8 | 75.8% | W | 55151.6 | 60.7% |
|  On-lending loans |  | 2018.1 | 2.7 |  | 13114.0 | 14.4 |
|  Foreign currency loans |  | 7792.4 | 10.4 |  | 1712.5 | 1.9 |
|  Local currency loans denominated in foreign currencies |  | 0.7 | 0.0 |  | 16.4 | 0.0 |
|  Offshore loans in foreign currencies |  | 4824.8 | 6.5 |  | 18487.3 | 20.3 |
|  Government fund loans |  | 61.4 | 0.1 |  | 0.0 | 0.0 |
|  Overdraft |  | 0.0 | 0.0 |  | 131.1 | 0.1 |
|  Others<sup>(1)</sup> |  | 3433.9 | 4.6 |  | 2288.2 | 2.5 |
|  Total | W | 74783.1 | 100.0% | W | 90901.1 | 100.0% |

---

(1) Includes loans on households and loans extended to affiliates.

*Industrial Fund Loans*. Industrial fund loans are equipment capital and working capital loans denominated in Won to borrowers in major industries to finance equipment and facilities.

We currently make equipment capital industrial fund loans at floating or fixed rates for terms of up to 20 years and for up to 100% of the equipment cost being financed. We make working capital industrial fund loans at floating or fixed rates and in amounts constituting up to 50% of the borrower's estimated annual sales for the manufacturing industry or up to 40% for the non-manufacturing industry, excluding depreciation expenses.

*On-lending Loans*. On-lending is a form of indirect financing that involves intermediary financial institutions which on-lend the funds provided by us to industrial borrowers and are responsible for repayment to us. Most of the funds provided by us through on-lending are ultimately lent to small- and medium-sized enterprises for their equipment purchases and working capital. We explicitly set detailed guidelines (including scope of borrowers, maturity and interest rates) for intermediary financial institutions to be followed when on-lending to the ultimate borrowers. We monitor our exposure to, and the credit standing of, each financial institution to which we lend. Borrowers do not apply directly to us and may only apply for our on-lending loans through their regular bank or another bank of their choice. The intermediary bank appraises the financial and business situation of the applicant and generally assumes liability for repayment to us. Although the processing of individual loans requires two formally separate loan approvals for each borrower, first by the intermediary bank and then by us, the ultimate borrower need only apply to the intermediary bank for approval.

*Foreign Currency Loans*. We extend loans denominated in U.S. dollars, Japanese Yen or other foreign currencies principally to finance the purchase of industrial equipment from abroad or the implementation of overseas industrial development projects by Korean companies. We make these loans at floating interest rates with original maturities, in the case of equipment capital foreign currency loans, of up to 20 years and, in the case of working capital foreign currency loans, of up to three years.

*Local Currency Loans Denominated in Foreign Currencies.* We make local currency loans denominated in foreign currencies for the same purposes, and to the same borrowers, as foreign currency loans. Although we denominate the loans in foreign currency, the borrower receives and repays the loans in Won based on foreign exchange rates at the time of receipt and repayment. We currently make loans of this type at floating interest rates, with original maturities, in the case of equipment capital loans, of up to 20 years and, in the case of working capital loans, of up to three years.

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##### [**Table of Contents**](#toc)
*Offshore Loans in Foreign Currencies*. We extend offshore loans in foreign currencies to finance:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the purchase of industrial equipment and the implementation of overseas industrial projects by overseas
subsidiaries and branches of Korean companies; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the overseas industrial development projects of foreign government entities, international organizations and
foreign companies.

We make these loans at floating interest rates with original maturities, in the form of equipment capital foreign currency loans, generally of up to 20 years and, working capital foreign currency loans, generally of up to three years. However, longer maturities may be negotiated on an individual basis.

*Government Fund Loans*. We make government fund loans primarily to finance:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• water supply and drainage facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Seoul subway system;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• freight terminal facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• hospitals; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other facilities.

Government fund loans that are equipment capital loans require approval by the appropriate Government ministry. We currently make government fund loans in Won at floating interest rates with original maturities of 10 to 20 years.

*Other Loans*. We also make special purpose fund loans for particular industries or projects using funds lent to us by the Government and foreign financial institutions. The Government funds that finance these loans include, among others:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Tourism Promotion Fund (hotel and resort projects);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Rational Use of Energy Fund (energy conservation projects and collective energy supply projects); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Small- and Medium-sized Enterprises Promotion Fund (small- and medium-sized enterprises).

For further information relating to such loans, see "—Sources of Funds."

***Guarantee Operations***

We extend guarantees to our clients to facilitate their other borrowings and to finance major industrial projects. We guarantee Won-denominated corporate debentures, local currency loans, and other Won liabilities and foreign currency loans from domestic and overseas Korean financial institutions and from foreign institutions. The KDB Act and our Articles of Incorporation limit the aggregate amount of our industrial finance bond obligations and guarantee obligations. See "—Sources of Funds."

We generally obtain collateral valued in excess of the original guarantee. We appraise the value of our collateral at least once a year. Depending on the borrower, the collateral may be industrial plants, real estate and/or marketable securities.

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The following table shows our outstanding guarantees:

**Guarantees Outstanding** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2023** | **2023** | **2024** | **2024** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Acceptances | W | 179.8 | W | 208.8 |
|  Guarantees on local borrowing |  | 795.7 |  | 742.5 |
|  Guarantees on foreign borrowing |  | 9793.3 |  | 11361.3 |
|  Letter of guarantee for importers |  | 35.9 |  | 42.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | W | 10804.7 | W | 12355.3 |

---

***Investments***

We invest in a range of Korean private and Government-owned enterprises but we will not take a controlling interest in a company unless the acquisition is necessary for the corporate restructuring of the company. Although generally a long-term investor, we sell investments from time to time. In recent years, sales resulted principally from the Government's privatization program, and we expect to continue such sales in the future. The Government plans to sell its direct or indirect interest in certain private sector companies acquired during previous restructuring programs, including Daewoo Engineering & Construction Co., Ltd., depending on market conditions. In accordance with such plan, we expect to sell our equity holdings in certain private sector companies if favorable opportunities for sale arise. Our equity investments increased to W51,083.5 billion as of December 31, 2024 from W45,040.4 billion as of December 31, 2023.

The KDB Act and our Articles of Incorporation provide that the cost basis of our total equity investments may not exceed twice the sum of our paid-in capital and our reserve from profit. In addition, pursuant to the KDB Decree, we may not acquire equity securities of a single company in excess of 15% of its entire voting shares. The 15% limit, however, does not apply to certain investments, including those in companies financed by capital contributions from the Government. As of December 31, 2024, the cost basis of our equity investments subject to restriction under the KDB Act and our Articles of Incorporation totaled W25,346.7 billion, equal to 42.1 % of our equity investment ceiling. For a discussion of Korean accounting principles relating to our equity investments, see "—Financial Statements and the Auditors."

The following table sets out our equity investments by industry sector on a book value basis as of December 31, 2024:

**Equity Investments** 

---

| | | |
|:---|:---|:---|
|  | **Book Value as of<br>December 31, 2024** | **Book Value as of<br>December 31, 2024** |
|  | **(billions of Won)** | **(billions of Won)** |
|  Electric, Gas and Water Supply Industry | W | 16984.6 |
|  Construction |  | 1013.5 |
|  Banking and Insurance |  | 13170.6 |
|  Real Estate Business |  | 9.7 |
|  Manufacturing |  | 3753.1 |
|  Transportation and Communication |  | 5939.7 |
|  Others |  | 10212.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | W | 51083.5 |

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##### [**Table of Contents**](#toc)
As of December 31, 2024, we held total equity investments, on a book value basis, of W3,381.0 billion in one of our five largest borrowers and W3,381.0 billion in three of our 20 largest borrowers. We have not established a policy addressing loans to enterprises in which we hold equity interests or equity interests in enterprises to which we have extended loans.

When possible, we use the prevailing market price of a security to determine the value of our interest. However, if no readily ascertainable market value exists for our holdings, we record these investments at the cost of acquisition. With respect to our equity interests in enterprises in which we hold more than 15% of interest, we value these investments annually, with certain exceptions, on a net asset value basis when the investee company releases its financial statements. As of December 31, 2024, the aggregate value of our equity investments accounted for approximately 78.9 % of their aggregate cost basis.

As part of our investment activities, we underwrite straight and convertible bond issuances in Won for domestic corporations. We also invest in municipal bonds, extending funds to municipalities at subsidized interest rates, mostly to finance water supply and drainage infrastructure projects.

***Other Activities***

We engage in a range of industrial development activities in addition to providing loans and guarantees, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• conducting economic and industrial research;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• performing engineering surveys;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• providing business analyses and managerial assistance; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• offering trust services.

As of December 31, 2024, we held in trust cash and other assets totaling W30,231.7 billion, and we generated in 2024 trust fee income equaling W441.5 billion. As of December 31, 2023, we held in trust cash and other assets totaling W32,834.0 billion, and we generated in 2023 trust fee income equaling W449.1 billion. Pursuant to Korean law, we segregate trust assets from our other assets; trust assets are not available to satisfy claims of our depositors or other creditors. Accordingly, we account for our trust accounts separately from our banking accounts. However, if our trust operations fail to preserve the principal of our clients' trust assets, we are responsible for covering the deficit either from previously established provisions in our trust accounts or by a transfer from our banking accounts. In 2023 and 2024, we did not transfer any funds from our banking accounts to cover deficits in our trust accounts. Surplus funds generated by the trust assets may be deposited into the clients' accounts and earn interest. We reflect trust fees earned by us on our trust account management services as other operating revenues in the income statement of the banking accounts.

**Sources of Funds** 

In addition to our capital and reserves, we obtain funds primarily from:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• borrowings from the Government;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• issuances of bonds in the domestic and international capital markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• borrowings from international financial institutions or foreign banks; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• deposits.

All of our borrowings are unsecured.

------

##### [**Table of Contents**](#toc)
***Borrowings from the Government***

We borrow from the Government's general purpose funds and its special purpose funds. General purpose loans generally are in Won and have fixed interest rates and maturities ranging from five to 20 years. We incur special purpose loans, principally from the Tourism Promotion Fund, the Rational Use of Energy Fund and the Small- and Medium-sized Enterprises Promotion Fund, in connection with specific projects we finance. The Government links the interest rate and maturity of each special purpose borrowing to the terms of the financing we provide for the specific project.

The following table sets out our Government borrowings as of December 31, 2024:

---

| | | |
|:---|:---|:---|
| **Type of Funds Borrowed** | **As of<br>December 31, 2024** | **As of<br>December 31, 2024** |
|  | **(billions of Won)** | **(billions of Won)** |
|  General Purpose | W | 62.2 |
|  Special Purpose |  | 4626.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | W | 4689.0 |

---

***Domestic and International Capital Markets***

We issue industrial finance bonds both in Korea and abroad, some of which the Government directly guarantees. We generally issue domestic bonds at fixed interest rates with original maturities of one to ten years.

The following table sets out the outstanding balance of our industrial finance bonds as of December 31, 2024:

---

| | | |
|:---|:---|:---|
| **Outstanding Balance** | **As of<br>December 31, 2024** | **As of<br>December 31, 2024** |
|  | **(billions of Won)** | **(billions of Won)** |
|  Denominated in Won | W | 115502.4 |
|  Denominated in Other Currencies |  | 52024.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | W | 167526.5 |

---

The KDB Act provides that the aggregate outstanding principal amount of our industrial finance bonds, other than those directly guaranteed or purchased by the Government, plus the aggregate outstanding amount of debt (including bonds and loans) guaranteed or purchased by us, other than those excepted by the KDB Act, may not exceed 30 times the sum of our paid-in capital and our reserve from profit. As of December 31, 2024, the aggregate amount of our industrial finance bonds and guarantee obligations (including guarantee obligations relating to loans that had not been borrowed as of December 31, 2024) was W187,040.0 billion, equal to 20.7 % of our authorized amount under the KDB Act, which was W903.587.9 billion.

In 2024, we issued W50.1 trillion in Won-denominated industrial finance bonds and W16.5 trillion in industrial finance bonds denominated in other currencies. In 2025, we are targeting to issue approximately W51.2 trillion in Won-denominated industrial finance bonds and approximately W20.3 trillion in industrial finance bonds denominated in other currencies, subject to change depending on our funding needs and market conditions.

***Foreign Currency Borrowings***

We borrow money from institutions, principally syndicates of commercial banks, outside the Republic in foreign currencies. We frequently enter into related interest rate and currency swap transactions. The loans generally have original maturities of one to five years. As of December 31, 2024, the outstanding amount of our foreign currency borrowings was US$19.0 billion.

------

##### [**Table of Contents**](#toc)
Our long term and short term foreign currency borrowings increased to W27,999.4 billion as of December 31, 2024 from W22,934.4 billion as of December 31, 2023.

***Deposits***

We take demand deposits and time and savings deposits from the general public. Time and savings deposits generally have maturities shorter than three years and bear interest at fixed rates. As of December 31, 2024, demand deposits held by us totaled W2,078.6 billion and time and savings deposits held by us totaled W54,865.3 billion.

**Debt** 

***Debt Repayment Schedule***

The following table sets out our principal repayment schedule as of December 31, 2024:

**Debt Principal Repayment Schedule<sup>(1)</sup>** 

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** | **Maturing on or before December 31,** |
| <br>**Currency<sup>(2)(3)</sup>** | **2025** | **2025** | **2026** | **2026** | **2027** | **2027** | **2028** | **2028** | **Thereafter** | **Thereafter** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Won | W | 51514.3 | W | 39346.6 | W | 15690.1 | W | 5071.3 | W | 8277.5 |
|  Foreign |  | 40715.7 |  | 14176.9 |  | 10157.7 |  | 6011.6 |  | 8961.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Won Equivalent | W | 92230.0 | W | 53523.5 | W | 25847.8 | W | 11082.9 | W | 17239.0 |

---

(1) Excludes bonds sold under repurchase agreements.

(2) Borrowings in foreign currencies have been translated into Won at the market average exchange rates on December
31, 2024, as announced by the Seoul Money Brokerage Services Ltd.

(3) We categorize debt with respect to which we have entered into currency swap agreements by our repayment currency
under such agreements.

The following table summarizes, as of December 31 of the years indicated, our outstanding direct internal debt:

**Direct Internal Debt** 

---

| | | |
|:---|:---|:---|
|  | **(billions of Won)** | **(billions of Won)** |
|  2020 |  | 113091.4 |
|  2021 |  | 115318.8 |
|  2022 |  | 126854.0 |
|  2023 |  | 121108.9 |
|  2024 |  | 120191.5 |

---

The following table summarizes, as of December 31 of the years indicated, our outstanding direct external debt:

**Direct External Debt** 

---

| | | |
|:---|:---|:---|
|  | **(billions of Won)** | **(billions of Won)** |
|  2020 |  | 42207.6 |
|  2021 |  | 52412.9 |
|  2022 |  | 60771.2 |
|  2023 |  | 66102.6 |
|  2024 |  | 80023.5 |

---

------

##### [**Table of Contents**](#toc)
The following table sets out, by currency and the equivalent amount in U.S. Dollars, our outstanding external bonds as of December 31, 2024:

**External Bonds** 

---

| | | | |
|:---|:---|:---|:---|
|  | **Amount in<br>Original<br>Currency** | **Equivalent<br>Amount in<br>U.S. Dollars<sup>(1)</sup>** | **Equivalent<br>Amount in<br>U.S. Dollars<sup>(1)</sup>** |
|  | **(millions)** | **(millions)** | **(millions)** |
|  US$ | USD27,349 |  | 27349 |
|  Euro (EUR) | EUR1,929 |  | 2006 |
|  New Zealand Dollar (NZD) | NZD140 |  | 79 |
|  Hong Kong dollar (HKD) | HKD6,200 |  | 799 |
|  Chinese offshore renminbi (CNH) | CNH5,330 |  | 730 |
|  Swiss franc (CHF) | CHF925 |  | 1023 |
|  Brazilian real (BRL) | BRL11,400 |  | 1846 |
|  Australian dollar (AUD) | AUD1,466 |  | 911 |
|  Great Britain Sterling (GBP) | GBP311 |  | 390 |
|  Norwegian Krone (NOK) | NOK400 |  | 35 |
|  Indonesian Rupiah (IDR) | IDR1,620,000 |  | 100 |
|  Indian Rupee (INR) | INR11,213 |  | 131 |
|  Swedish Krona (SEK) | SEK1,410 |  | 128 |
|  Mexican Peso (MXN) | MXN3,500 |  | 169 |
|  Thai Baht (THB) | THB4,580 |  | 134 |
|  Singapore Dollar (SGD) | SGD20 |  | 15 |
|  Japanese Yen (JPY) | JPY10,000 |  | 64 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total |  | US$ | 35909 |

---

(1) Amounts expressed in currencies other than US$ are converted to US$ at the exchange rate announced by the Seoul
Money Brokerage Services, Ltd. in effect on December 31, 2024.

For further information on our outstanding indebtedness, see "—Tables and Supplementary Information."

***Debt Record***

We have never defaulted in the payment of principal or interest on any of our obligations.

**Overseas Operations** 

We operate overseas subsidiaries in Hong Kong, Dublin, Budapest, Sao Paulo, Tashkent, Jakarta and Mountain View. The subsidiaries engage in a variety of banking and merchant banking services, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• managing and underwriting new securities issues;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• syndicating medium and long-term loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• trading securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• trading in the money market; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• providing investment management and advisory services.

We currently maintain twelve branches in Tokyo, Shanghai, Singapore, New York City, London, Beijing, Guangzhou, Qingdao, Shenyang, Yangon, Hong Kong and Frankfurt, and six overseas representative offices in Ho Chi Minh City, Abu Dhabi, Moscow, Sydney, Bangkok and Jakarta.

------

##### [**Table of Contents**](#toc)
**Property** 

Our head office is located at 14 Eunhaeng-ro, Yeongdeungpo-gu, Seoul, Korea, a 35,996 square meter building completed in July 2001 and owned by us. In addition to the head office, we maintain 60 branches in major cities throughout the Republic, including 18 in Seoul. We generally lease our domestic and overseas offices under long-term leases.

**Directors and Management; Employees** 

Our Board of Directors has ultimate responsibility for management of our affairs. Under the KDB Act and our Articles of Incorporation, our Board of Directors is to consist of one Chief Executive Officer (who also serves as the Chairman of the Board of Directors), one Chief Operating Officer and not more than eight directors. Under the KDB Act, the President of the Republic appoints our Chief Executive Officer and Chairman of the Board of Directors upon the recommendation of the Chairman of the Financial Services Commission. The Financial Services Commission appoints all of our directors upon the recommendation of our Chief Executive Officer. Under our Articles of Incorporation, our executive directors serve for three-year terms and they may be re-appointed, and our independent non-executive directors serve for two-year terms and they may be re-appointed; provided, however, that our independent non-executive directors shall not serve more than one year for each reappointment and shall not serve more than five years consecutively.

Currently, the members of our Board of Directors are:

---

| | | |
|:---|:---|:---|
| **Position** | **Name** | **Expiration of Term** |
|  Chief Executive Officer and Chairman of the Board of Directors | Seog Hoon Kang | June 6, 2025 |
|  Chief Operating Officer and Vice Chairman of the Board of Directors | Bock Kyu Kim | March 22, 2026 |
|  Auditor | Jae Shin Kim | August 25, 2027 |
|  Independent Non-executive Directors | Hee Rak Kim | January 28, 2026 |
|  | Sun Key You | January 28, 2026 |
|  | Seung Cheol Jeon | May 1, 2027 |
|  | Seonghoon Cho | May 1, 2027 |

---

As of December 31, 2024, we employed 3,513 persons with 2,091 persons located in our head office.

------

##### [**Table of Contents**](#toc)
**Tables and Supplementary Information** 

&nbsp;&nbsp;&nbsp;&nbsp;***A. External Debt of KDB***

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(1) External Bonds of KDB* 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Currency** | **Original<br>Principal<br>Amount** | **Interest Rate**<br>**(%)** | **Issue Date** | **Maturity Date** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** |
|  USD | 50000000 | 2.730 | February 6, 2015 | February 6, 2027 | 50000000 |
|  USD | 30000000 | 3.010 | June 24, 2015 | June 24, 2025 | 30000000 |
|  USD | 50000000 | 3.376 | July 9, 2015 | July 9, 2025 | 50000000 |
|  USD | 50000000 | 3.330 | July 22, 2015 | July 22, 2025 | 50000000 |
|  USD | 50000000 | 3.200 | August 6, 2015 | August 6, 2025 | 50000000 |
|  USD | 350000000 | 3.375 | September 16, 2015 | September 16, 2025 | 350000000 |
|  USD | 400000000 | 3.375 | September 16, 2015 | September 16, 2025 | 400000000 |
|  USD | 1000000000 | 3.000 | January 13, 2016 | January 13, 2026 | 1000000000 |
|  USD | 50000000 | 2.690 | March 30, 2016 | March 30, 2026 | 50000000 |
|  USD | 53000000 | 2.180 | August 10, 2016 | August 10, 2026 | 53000000 |
|  USD | 500000000 | 2.000 | September 12, 2016 | September 12, 2026 | 500000000 |
|  USD | 50000000 | 2.530 | November 10, 2016 | November 10, 2028 | 50000000 |
|  USD | 50000000 | 3.088 | January 17, 2017 | January 17, 2027 | 50000000 |
|  USD | 50000000 | 3.800 | January 29, 2018 | January 29, 2038 | 50000000 |
|  USD | 50000000 | 4.100 | March 19, 2018 | March 19, 2048 | 50000000 |
|  USD | 750000000 | 1.750 | February 18, 2020 | February 18, 2025\* | 750000000 |
|  USD | 32000000 | 3M USD Libor+1.35 | April 22, 2020 | October 22, 2025 | 32000000 |
|  USD | 50000000 | 3M USD Libor+1.30 | April 28, 2020 | April 28, 2025\* | 50000000 |
|  USD | 40000000 | 3M USD Libor+1.25 | April 29, 2020 | April 29, 2025\* | 40000000 |
|  USD | 50000000 | 3M USD Libor+1.20 | May 7, 2020 | May 7, 2025\* | 50000000 |
|  USD | 50000000 | 3M USD Libor+1.13 | May 15, 2020 | May 15, 2025 | 50000000 |
|  USD | 500000000 | 1.250 | June 3, 2020 | June 3, 2025 | 500000000 |
|  USD | 500000000 | 1.250 | June 3, 2020 | June 3, 2025 | 500000000 |
|  USD | 500000000 | 0.800 | October 27, 2020 | April 27, 2026 | 500000000 |
|  USD | 500000000 | 0.800 | January 19, 2021 | July 19, 2026 | 500000000 |
|  USD | 300000000 | 1.625 | January 19, 2021 | January 19, 2031 | 300000000 |
|  USD | 500000000 | 1.000 | March 9, 2021 | September 9, 2026 | 500000000 |
|  USD | 300000000 | 2.000 | April 1, 2021 | April 1, 2031 | 300000000 |
|  USD | 200000000 | SOFR+0.29 | May 18, 2021 | May 18, 2025 | 200000000 |
|  USD | 100000000 | 1.146 | May 18, 2021 | May 18, 2026 | 100000000 |
|  USD | 100000000 | 1.035 | June 18, 2021 | June 18, 2026 | 100000000 |
|  USD | 100000000 | 1.015 | June 4, 2021 | December 4, 2025 | 100000000 |
|  USD | 100000000 | 1.145 | June 4, 2021 | June 4, 2026 | 100000000 |
|  USD | 100000000 | 3M USD Libor+0.25 | June 11, 2021 | June 11, 2026 | 100000000 |
|  USD | 50000000 | 2.470 | August 24, 2021 | August 24, 2051 | 50000000 |
|  USD | 200000000 | 1.750 | September 27, 2021 | September 27, 2031 | 200000000 |
|  USD | 20000000 | 2.850 | October 12, 2021 | October 12, 2051 | 20000000 |
|  USD | 20000000 | 2.925 | October 18, 2021 | October 18, 2051 | 20000000 |
|  USD | 700000000 | 0.750 | October 25, 2021 | January 25, 2025\* | 700000000 |
|  USD | 500000000 | 1.375 | October 25, 2021 | April 25, 2027 | 500000000 |
|  USD | 300000000 | 2.000 | October 25, 2021 | October 25, 2031 | 300000000 |
|  USD | 20000000 | 2.870 | November 19, 2021 | November 19, 2051 | 20000000 |
|  USD | 20000000 | 1.448 | December 2, 2021 | December 2, 2025 | 20000000 |
|  USD | 38000000 | 1.950 | January 25, 2022 | January 25, 2027 | 38000000 |
|  USD | 200000000 | 2.250 | January 26, 2022 | January 26, 2032 | 200000000 |
|  USD | 750000000 | 2.000 | February 24, 2022 | February 24, 2025\* | 750000000 |
|  USD | 250000000 | 2.000 | February 24, 2022 | February 24, 2025\* | 250000000 |
|  USD | 500000000 | 2.250 | February 24, 2022 | February 24, 2027 | 500000000 |
|  USD | 40000000 | 2.643 | March 18, 2022 | March 18, 2032 | 40000000 |
|  USD | 100000000 | 3.130 | April 21, 2022 | April 21, 2025\* | 100000000 |
|  USD | 50000000 | 3.400 | May 18, 2022 | May 18, 2027 | 50000000 |
|  USD | 300000000 | 3.125 | June 7, 2022 | June 7, 2025 | 300000000 |
|  USD | 1000000000 | 4.000 | September 8, 2022 | September 8, 2025 | 1000000000 |
|  USD | 450000000 | 4.250 | September 8, 2022 | September 8, 2032 | 450000000 |
|  USD | 50000000 | SOFR+1.00 | October 14, 2022 | October 14, 2027 | 50000000 |
|  USD | 50000000 | SOFR+1.005 | October 17, 2022 | October 17, 2027 | 50000000 |
|  USD | 50000000 | SOFR+0.995 | October 17, 2022 | October 17, 2027 | 50000000 |
|  USD | 50000000 | SOFR+1.00 | October 19, 2022 | October 19, 2027 | 50000000 |

---

------

##### [**Table of Contents**](#toc)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Currency** | **Original<br>Principal<br>Amount** | **Interest Rate**<br>**(%)** | **Issue Date** | **Maturity Date** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** |
|  USD | 50000000 | SOFR+1.03 | October 26, 2022 | October 26, 2027 | 50000000 |
|  USD | 50000000 | SOFR+1.03 | October 27, 2022 | October 27, 2027 | 50000000 |
|  USD | 50000000 | SOFR+1.03 | October 28, 2022 | October 28, 2027 | 50000000 |
|  USD | 50000000 | SOFR+0.75 | November 3, 2022 | November 3, 2025 | 50000000 |
|  USD | 200000000 | 3.125 | November 3, 2022 | June 7, 2025 | 200000000 |
|  USD | 20000000 | SOFR+1.30 | November 4, 2022 | November 4, 2027 | 20000000 |
|  USD | 130000000 | 5.450 | November 21, 2022 | November 21, 2028 | 130000000 |
|  USD | 35000000 | SOFR+1.30 | November 22, 2022 | November 22, 2027 | 35000000 |
|  USD | 20000000 | 5.450 | November 28, 2022 | November 28, 2028 | 20000000 |
|  USD | 20000000 | SOFR+1.30 | November 28, 2022 | November 28, 2027 | 20000000 |
|  USD | 20000000 | SOFR+1.30 | December 8, 2022 | December 8, 2027 | 20000000 |
|  USD | 60000000 | SOFR+1.29 | December 14, 2022 | December 14, 2027 | 60000000 |
|  USD | 55000000 | SOFR+0.60 | February 3, 2023 | February 3, 2025\* | 55000000 |
|  USD | 40000000 | SOFR+0.95 | February 10, 2023 | February 10, 2028 | 40000000 |
|  USD | 1000000000 | 4.375 | February 15, 2023 | February 15, 2028 | 1000000000 |
|  USD | 1000000000 | 4.375 | February 15, 2023 | February 15, 2033 | 1000000000 |
|  USD | 50000000 | SOFR+0.75 | February 16, 2023 | February 16, 2026 | 50000000 |
|  USD | 50000000 | 5.250 | February 27, 2023 | February 27, 2025\* | 50000000 |
|  USD | 10000000 | 5.010 | March 3, 2023 | March 3, 2026 | 10000000 |
|  USD | 20000000 | 5.500 | March 7, 2023 | March 7, 2025\* | 20000000 |
|  USD | 10000000 | 4.640 | May 8, 2023 | May 8, 2025\* | 10000000 |
|  USD | 40000000 | SOFR+0.85 | May 11, 2023 | May 11, 2028 | 40000000 |
|  USD | 50000000 | SOFR+0.80 | June 5, 2023 | June 5, 2026 | 50000000 |
|  USD | 50000000 | SOFR+0.80 | June 15, 2023 | June 15, 2026 | 50000000 |
|  USD | 50000000 | SOFR+0.80 | June 20, 2023 | June 20, 2026 | 50000000 |
|  USD | 50000000 | SOFR+0.82 | June 26, 2023 | June 26, 2026 | 50000000 |
|  USD | 22000000 | SOFR+0.80 | July 12, 2023 | July 12, 2026 | 22000000 |
|  USD | 50000000 | 5.320 | July 14, 2023 | July 14, 2026 | 50000000 |
|  USD | 300000000 | SOFR+0.90 | August 1, 2023 | August 1, 2028 | 300000000 |
|  USD | 50000000 | 5.240 | August 2, 2023 | August 2, 2026 | 50000000 |
|  USD | 50000000 | 5.430 | August 8, 2023 | August 8, 2025 | 50000000 |
|  USD | 50000000 | 5.250 | August 11, 2023 | August 11, 2026 | 50000000 |
|  USD | 50000000 | SOFR+0.55 | August 18, 2023 | August 18, 2025 | 50000000 |
|  USD | 50000000 | SOFR+0.55 | August 18, 2023 | August 18, 2025 | 50000000 |
|  USD | 50000000 | 5.500 | August 29, 2023 | August 29, 2043 | 50000000 |
|  USD | 75000000 | SOFR+0.50 | September 13, 2023 | March 13, 2025\* | 75000000 |
|  USD | 300000000 | SOFR+0.70 | October 23, 2023 | October 23, 2026 | 300000000 |
|  USD | 700000000 | 5.375 | October 23, 2023 | October 23, 2026 | 700000000 |
|  USD | 500000000 | 5.375 | October 23, 2023 | October 23, 2028 | 500000000 |
|  USD | 500000000 | 5.625 | October 23, 2023 | October 23, 2033 | 500000000 |
|  USD | 38000000 | SOFR+0.70 | October 31, 2023 | October 30, 2026 | 38000000 |
|  USD | 33000000 | SOFR+0.87 | November 15, 2023 | November 15, 2028 | 33000000 |
|  USD | 50000000 | SOFR+0.87 | November 29, 2023 | November 29, 2028 | 50000000 |
|  USD | 20000000 | SOFR+0.79 | December 20, 2023 | December 20, 2028 | 20000000 |
|  USD | 30000000 | 4.780 | December 29, 2023 | August 29, 2025 | 30000000 |
|  USD | 100000000 | SOFR+0.38 | January 19, 2024 | January 19, 2025\* | 100000000 |
|  USD | 50000000 | SOFR+0.51 | January 19, 2024 | January 19, 2026 | 50000000 |
|  USD | 20000000 | SOFR+0.90 | January 24, 2024 | January 24, 2031 | 20000000 |
|  USD | 1750000000 | 4.625 | February 15, 2024 | February 15, 2027 | 1750000000 |
|  USD | 1250000000 | 4.500 | February 15, 2024 | February 15, 2029 | 1250000000 |
|  USD | 12000000 | SOFR+0.30 | February 21, 2024 | February 21, 2025\* | 12000000 |
|  USD | 50000000 | SOFR+0.35 | February 26, 2024 | March 26, 2025\* | 50000000 |
|  USD | 50000000 | 4.945 | February 28, 2024 | February 28, 2027 | 50000000 |
|  USD | 100000000 | 5.470 | March 6, 2024 | March 5, 2025\* | 100000000 |
|  USD | 30000000 | 5.500 | March 26, 2024 | March 26, 2025\* | 30000000 |
|  USD | 100000000 | 5.490 | March 26, 2024 | March 26, 2025\* | 100000000 |
|  USD | 50000000 | 5.490 | March 27, 2024 | March 27, 2025\* | 50000000 |
|  USD | 50000000 | 5.360 | April 11, 2024 | April 11, 2025\* | 50000000 |
|  USD | 100000000 | SOFR+0.36 | April 12, 2024 | May 9, 2025\* | 100000000 |
|  USD | 30000000 | 5.380 | April 12, 2024 | May 12, 2025 | 30000000 |
|  USD | 100000000 | 5.368 | April 16, 2024 | April 16, 2025\* | 100000000 |
|  USD | 50000000 | 5.374 | April 17, 2024 | April 17, 2025\* | 50000000 |
|  USD | 50000000 | SOFR+0.36 | April 17, 2024 | May 17, 2025\* | 50000000 |
|  USD | 20000000 | SOFR+0.60 | April 17, 2024 | April 17, 2029 | 20000000 |
|  USD | 50000000 | 5.530 | April 18, 2024 | April 18, 2025\* | 50000000 |

---

------

##### [**Table of Contents**](#toc)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Currency** | **Original<br>Principal<br>Amount** | **Interest Rate**<br>**(%)** | **Issue Date** | **Maturity Date** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** |
|  USD | 50000000 | 5.530 | April 18, 2024 | April 18, 2025\* |  | 50000000 |
|  USD | 50000000 | 5.640 | April 19, 2024 | April 19, 2025\* |  | 50000000 |
|  USD | 20000000 | 5.562 | April 23, 2024 | April 23, 2025\* |  | 20000000 |
|  USD | 57000000 | 5.545 | April 25, 2024 | April 25, 2025\* |  | 57000000 |
|  USD | 20000000 | 5.460 | May 3, 2024 | October 30, 2025 |  | 20000000 |
|  USD | 50000000 | 5.600 | May 20, 2024 | May 22, 2025 |  | 50000000 |
|  USD | 50000000 | 5.510 | May 30, 2024 | May 30, 2025 |  | 50000000 |
|  USD | 65000000 | SOFR+0.30 | May 30, 2024 | November 20, 2025 |  | 65000000 |
|  USD | 20000000 | 5.560 | June 7, 2024 | June 7, 2025 |  | 20000000 |
|  USD | 50000000 | SOFR+0.60 | June 12, 2024 | June 3, 2029 |  | 50000000 |
|  USD | 25000000 | SOFR+0.59 | June 14, 2024 | June 14, 2027 |  | 25000000 |
|  USD | 20000000 | 5.490 | June 21, 2024 | June 21, 2025 |  | 20000000 |
|  USD | 1000000000 | 4.750 | June 26, 2024 | June 26, 2027 |  | 1000000000 |
|  USD | 58000000 | 5.240 | June 28, 2024 | August 28, 2025 |  | 58000000 |
|  USD | 65000000 | SOFR+0.75 | July 12, 2024 | July 12, 2029 |  | 65000000 |
|  USD | 41000000 | 4.990 | July 18, 2024 | December 18, 2025 |  | 41000000 |
|  USD | 100000000 | SOFR+0.30 | July 25, 2024 | July 24, 2025 |  | 100000000 |
|  USD | 100000000 | SOFR+0.30 | July 25, 2024 | July 24, 2025 |  | 100000000 |
|  USD | 100000000 | SOFR+0.30 | August 1, 2024 | July 31, 2025 |  | 100000000 |
|  USD | 100000000 | SOFR+0.29 | August 1, 2024 | July 31, 2025 |  | 100000000 |
|  USD | 30000000 | 4.660 | August 30, 2024 | August 30, 2025 |  | 30000000 |
|  USD | 100000000 | SOFR+0.40 | August 30, 2024 | February 27, 2026 |  | 100000000 |
|  USD | 50000000 | SOFR+0.35 | September 3, 2024 | September 3, 2025 |  | 50000000 |
|  USD | 20000000 | 4.071 | September 5, 2024 | September 5, 2027 |  | 20000000 |
|  USD | 100000000 | SOFR+0.45 | September 12, 2024 | March 12, 2026 |  | 100000000 |
|  USD | 50000000 | SOFR+0.45 | September 13, 2024 | March 13, 2026 |  | 50000000 |
|  USD | 100000000 | SOFR+0.35 | September 23, 2024 | September 23, 2025 |  | 100000000 |
|  USD | 50000000 | SOFR+0.35 | September 30, 2024 | September 30, 2025 |  | 50000000 |
|  USD | 50000000 | 4.490 | October 16, 2024 | October 16, 2025 |  | 50000000 |
|  USD | 1000000000 | 4.125 | October 16, 2024 | October 16, 2027 |  | 1000000000 |
|  USD | 50000000 | SOFR+0.40 | October 22, 2024 | October 22, 2025 |  | 50000000 |
|  USD | 60000000 | 4.525 | October 30, 2024 | October 30, 2025 |  | 60000000 |
|  USD | 50000000 | 4.535 | November 7, 2024 | November 7, 2025 |  | 50000000 |
|  USD | 50000000 | 4.470 | November 12, 2024 | November 12, 2029 |  | 50000000 |
|  USD | 50000000 | 4.590 | November 14, 2024 | November 14, 2025 |  | 50000000 |
|  USD | 30000000 | 4.650 | November 19, 2024 | November 19, 2025 |  | 30000000 |
|  USD | 10000000 | 4.530 | November 19, 2024 | May 19, 2026 |  | 10000000 |
|  USD | 10000000 | 4.580 | November 20, 2024 | November 20, 2026 |  | 10000000 |
|  USD | 50000000 | 4.670 | November 29, 2024 | November 29, 2025 |  | 50000000 |
|  USD | 100000000 | SOFR+0.32 | December 2, 2024 | December 22, 2025 |  | 100000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | USD | 27424000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(1)</sup> | Subtotal in Equivalent Amount of Won<sup>(1)</sup> | Subtotal in Equivalent Amount of Won<sup>(1)</sup> | W | 40313280000000 |
|  NZD | 27000000 | 2.600 | June 1, 2021 | June 1, 2031 |  | 27000000 |
|  NZD | 27000000 | 2.600 | June 9, 2021 | June 9, 2031 |  | 27000000 |
|  NZD | 27000000 | 2.600 | June 16, 2021 | June 16, 2031 |  | 27000000 |
|  NZD | 29000000 | 3.000 | October 8, 2021 | October 8, 2031 |  | 29000000 |
|  NZD | 30000000 | 5.450 | January 27, 2023 | January 27, 2028 |  | 30000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | NZD | 140000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(2)</sup> | Subtotal in Equivalent Amount of Won<sup>(2)</sup> | Subtotal in Equivalent Amount of Won<sup>(2)</sup> | W | 115957800000 |
|  HKD | 160000000 | 2.100 | March 25, 2020 | March 25, 2025\* |  | 160000000 |
|  HKD | 200000000 | 0.740 | September 1, 2021 | September 12, 2025 |  | 200000000 |
|  HKD | 390000000 | 3.450 | May 10, 2022 | May 10, 2029 |  | 390000000 |
|  HKD | 169000000 | 3.600 | May 12, 2022 | May 12, 2029 |  | 169000000 |
|  HKD | 349000000 | 4.200 | June 28, 2022 | June 17, 2032 |  | 349000000 |
|  HKD | 320000000 | 4.150 | September 23, 2022 | September 25, 2025 |  | 320000000 |
|  HKD | 230000000 | 4.100 | April 25, 2023 | April 25, 2030 |  | 230000000 |
|  HKD | 200000000 | 4.150 | April 26, 2023 | April 26, 2030 |  | 200000000 |
|  HKD | 170000000 | 4.620 | September 11, 2023 | September 11, 2026 |  | 170000000 |
|  HKD | 100000000 | 4.630 | September 13, 2023 | September 13, 2026 |  | 100000000 |
|  HKD | 300000000 | 4.500 | January 11, 2024 | January 13, 2025\* |  | 300000000 |
|  HKD | 390000000 | 4.540 | January 24, 2024 | January 24, 2025\* |  | 390000000 |
|  HKD | 200000000 | 4.510 | January 24, 2024 | January 24, 2025\* |  | 200000000 |
|  HKD | 390000000 | 4.040 | January 25, 2024 | January 25, 2027 |  | 390000000 |

---

------

##### [**Table of Contents**](#toc)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Currency** | **Original<br>Principal<br>Amount** | **Interest Rate<br>(%)** | **Issue Date** | **Maturity Date** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** |
|  HKD | 300000000 | 4.600 | January 29, 2024 | February 3, 2025\* |  | 300000000 |
|  HKD | 200000000 | 4.420 | March 7, 2024 | March 7, 2025\* |  | 200000000 |
|  HKD | 120000000 | 4.720 | March 27, 2024 | March 27, 2025\* |  | 120000000 |
|  HKD | 300000000 | 4.450 | March 27, 2024 | March 27, 2026 |  | 300000000 |
|  HKD | 123000000 | 4.640 | May 7, 2024 | May 7, 2026 |  | 123000000 |
|  HKD | 250000000 | 4.450 | May 10, 2024 | May 10, 2027 |  | 250000000 |
|  HKD | 389000000 | 3.500 | August 20, 2024 | August 20, 2027 |  | 389000000 |
|  HKD | 390000000 | 4.020 | November 5, 2024 | November 5, 2025 |  | 390000000 |
|  HKD | 360000000 | 3.725 | December 10, 2024 | December 10, 2029 |  | 360000000 |
|  HKD | 200000000 | 4.050 | December 19, 2024 | December 19, 2025 |  | 200000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | HKD | 6200000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(3)</sup> | Subtotal in Equivalent Amount of Won<sup>(3)</sup> | Subtotal in Equivalent Amount of Won<sup>(3)</sup> | W | 1173660000000 |
|  CNH | 287000000 | 3.010 | May 6, 2020 | May 6, 2025\* |  | 287000000 |
|  CNH | 140000000 | 3.460 | May 19, 2022 | May 19, 2026 |  | 140000000 |
|  CNH | 260000000 | 3.300 | June 30, 2022 | June 20, 2032 |  | 260000000 |
|  CNH | 230000000 | 3.400 | July 29, 2022 | July 29, 2025 |  | 230000000 |
|  CNH | 235000000 | 3.200 | August 19, 2022 | August 19, 2025 |  | 235000000 |
|  CNH | 130000000 | 3.310 | August 19, 2022 | August 19, 2025 |  | 130000000 |
|  CNH | 400000000 | 3.490 | September 22, 2022 | September 22, 2025 |  | 400000000 |
|  CNH | 330000000 | 3.700 | November 30, 2022 | November 30, 2027 |  | 330000000 |
|  CNH | 250000000 | 3.410 | January 19, 2023 | January 19, 2026 |  | 250000000 |
|  CNH | 250000000 | 3.510 | January 19, 2023 | January 19, 2026 |  | 250000000 |
|  CNH | 355000000 | 2.950 | June 14, 2023 | June 14, 2026 |  | 355000000 |
|  CNH | 325000000 | 2.950 | June 15, 2023 | June 15, 2026 |  | 325000000 |
|  CNH | 330000000 | 3.050 | June 26, 2023 | June 26, 2026 |  | 330000000 |
|  CNH | 187000000 | 3.080 | June 30, 2023 | June 30, 2026 |  | 187000000 |
|  CNH | 181000000 | 3.000 | July 26, 2023 | July 26, 2026 |  | 181000000 |
|  CNH | 350000000 | 3.000 | July 31, 2023 | July 31, 2026 |  | 350000000 |
|  CNH | 330000000 | 2.965 | August 30, 2023 | August 30, 2025 |  | 330000000 |
|  CNH | 150000000 | 3.120 | September 14, 2023 | September 14, 2026 |  | 150000000 |
|  CNH | 360000000 | 2.770 | July 31, 2024 | July 31, 2027 |  | 360000000 |
|  CNH | 250000000 | 2.800 | September 5, 2024 | September 5, 2034 |  | 250000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | CNH | 5330000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(4)</sup> | Subtotal in Equivalent Amount of Won<sup>(4)</sup> | Subtotal in Equivalent Amount of Won<sup>(4)</sup> | W | 1072769100000 |
|  EUR | 500000000 | 2.625 | September 8, 2022 | September 8, 2027 |  | 500000000 |
|  EUR | 50000000 | 2.810 | October 13, 2022 | October 13, 2026 |  | 50000000 |
|  EUR | 50000000 | 2.810 | October 14, 2022 | October 14, 2026 |  | 50000000 |
|  EUR | 100000000 | 3.180 | October 19, 2022 | October 19, 2026 |  | 100000000 |
|  EUR | 100000000 | 3.180 | October 19, 2022 | October 19, 2026 |  | 100000000 |
|  EUR | 750000000 | 3.375 | May 23, 2023 | May 23, 2028 |  | 750000000 |
|  EUR | 250000000 | 3.375 | September, 2023 | May 23, 2028 |  | 250000000 |
|  EUR | 20000000 | ESTR+0.36 | March 25, 2024 | March 25, 2026 |  | 20000000 |
|  EUR | 15000000 | ESTR+0.22 | April 9, 2024 | May 9, 2025\* |  | 15000000 |
|  EUR | 94000000 | ESTR+0.275 | November 29, 2024 | November 29, 2025 |  | 94000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | EUR | 1929000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(5)</sup> | Subtotal in Equivalent Amount of Won<sup>(5)</sup> | Subtotal in Equivalent Amount of Won<sup>(5)</sup> | W | 2948920170000 |
|  CHF | 300000000 | 0.445 | May 8, 2020 | May 8, 2025\* |  | 300000000 |
|  CHF | 200000000 | 0.170 | July 22, 2021 | July 22, 2031 |  | 200000000 |
|  CHF | 225000000 | 0.940 | April 28, 2022 | April 28, 2027 |  | 225000000 |
|  CHF | 200000000 | 2.2225 | July 24, 2024 | July 24, 2026 |  | 200000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | CHF | 925000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(6)</sup> | Subtotal in Equivalent Amount of Won<sup>(6)</sup> | Subtotal in Equivalent Amount of Won<sup>(6)</sup> | W | 1504401500000 |
|  BRL | 245000000 | 8.820 | December 13, 2023 | December 13, 2025 |  | 245000000 |
|  BRL | 492000000 | 8.672 | January 26, 2024 | January 26, 2025\* |  | 492000000 |
|  BRL | 250500000 | 8.638 | March 22, 2024 | March 23, 2026 |  | 250500000 |
|  BRL | 249000000 | 8.24 | April 4, 2024 | April 2, 2026 |  | 249000000 |
|  BRL | 249500000 | 8.94 | April 8, 2024 | April 8, 2026 |  | 249500000 |
|  BRL | 252000000 | 7.79 | April 11, 2024 | April 11, 2025\* |  | 252000000 |
|  BRL | 251000000 | 8.978 | April 11, 2024 | April 10, 2026 |  | 251000000 |
|  BRL | 253500000 | 9.26 | April 18, 2024 | April 17, 2026 |  | 253500000 |
|  BRL | 518000000 | 8.68 | April 19, 2024 | April 17, 2026 |  | 518000000 |

---

------

##### [**Table of Contents**](#toc)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Currency** | **Original<br>Principal<br>Amount** | **Interest Rate<br>(%)** | **Issue Date** | **Maturity Date** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** |
|  BRL | 527000000 | 8.88 | April 22, 2024 | April 22, 2026 |  | 527000000 |
|  BRL | 256500000 | 9.570 | May 10, 2024 | May 8, 2026 |  | 256500000 |
|  BRL | 257500000 | 9.550 | May 21, 2024 | May 21, 2026 |  | 257500000 |
|  BRL | 256000000 | 9.525 | May 23, 2024 | May 22, 2026 |  | 256000000 |
|  BRL | 256500000 | 8.745 | May 23, 2024 | May 22, 2026 |  | 256500000 |
|  BRL | 254500000 | 8.835 | May 28, 2024 | May 28, 2026 |  | 254500000 |
|  BRL | 257500000 | 9.747 | May 31, 2024 | May 29, 2026 |  | 257500000 |
|  BRL | 257000000 | 9.70 | June 3, 2024 | June 1, 2026 |  | 257000000 |
|  BRL | 515000000 | 8.828 | June 4, 2024 | June 2, 2026 |  | 515000000 |
|  BRL | 519500000 | 9.021 | June 5, 2024 | June 5, 2026 |  | 519500000 |
|  BRL | 270500000 | 9.28 | July 17, 2024 | December 30, 2025 |  | 270500000 |
|  BRL | 110000000 | 8.85 | July 24, 2024 | December 24, 2025 |  | 110000000 |
|  BRL | 1400000000 | 9.888 | July 30, 2024 | January 8, 2026 |  | 1400000000 |
|  BRL | 236000000 | 9.145 | August 12, 2024 | August 3, 2026 |  | 236000000 |
|  BRL | 234000000 | 9.36 | August 13, 2024 | August 3, 2026 |  | 234000000 |
|  BRL | 280000000 | 9.40 | August 14, 2024 | December 30, 2025 |  | 280000000 |
|  BRL | 280500000 | 9.06 | August 16, 2024 | August 18, 2025 |  | 280500000 |
|  BRL | 280000000 | 9.50 | August 16, 2024 | December 30, 2025 |  | 280000000 |
|  BRL | 282500000 | 9.46 | September 6, 2024 | December 30, 2025 |  | 282500000 |
|  BRL | 271000000 | 9.60 | September 30, 2024 | January 15, 2026 |  | 271000000 |
|  BRL | 278500000 | 11.04 | October 17, 2024 | October 16, 2026 |  | 278500000 |
|  BRL | 281500000 | 11.18 | October 21, 2024 | October 21, 2026 |  | 281500000 |
|  BRL | 250000000 | 10.385 | October 23, 2024 | December 16, 2025 |  | 250000000 |
|  BRL | 250000000 | 10.33 | October 25, 2024 | December 18, 2025 |  | 250000000 |
|  BRL | 288500000 | 11.21 | November 22, 2024 | November 19, 2026 |  | 288500000 |
|  BRL | 289000000 | 11.235 | November 25, 2024 | November 25, 2026 |  | 289000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | BRL | 11399500000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(7)</sup> | Subtotal in Equivalent Amount of Won<sup>(7)</sup> | Subtotal in Equivalent Amount of Won<sup>(7)</sup> | W | 2712397030000 |
|  AUD | 100000000 | 3.966 | November 30, 2016 | November 30, 2026 |  | 100000000 |
|  AUD | 60000000 | 3.760 | January 18, 2018 | January 18, 2028 |  | 60000000 |
|  AUD | 74000000 | 1.460 | February 24, 2020 | February 24, 2025\* |  | 74000000 |
|  AUD | 74000000 | 1.460 | February 24, 2020 | February 24, 2025\* |  | 74000000 |
|  AUD | 74000000 | 1.450 | February 25, 2020 | February 25, 2025\* |  | 74000000 |
|  AUD | 74000000 | 1.450 | February 25, 2020 | February 25, 2025\* |  | 74000000 |
|  AUD | 56000000 | 2.565 | April 7, 2021 | April 1, 2036 |  | 56000000 |
|  AUD | 30000000 | 2.550 | September 28, 2021 | September 28, 2041 |  | 30000000 |
|  AUD | 40000000 | 2.500 | September 28, 2021 | September 28, 2041 |  | 40000000 |
|  AUD | 40000000 | 3M BBSW+0.70 | September 28, 2021 | September 28, 2031 |  | 40000000 |
|  AUD | 60000000 | 2.550 | September 30, 2021 | September 30, 2036 |  | 60000000 |
|  AUD | 50000000 | 2.780 | October 18, 2021 | October 18, 2041 |  | 50000000 |
|  AUD | 30000000 | 3.190 | November 26, 2021 | November 26, 2041 |  | 30000000 |
|  AUD | 50000000 | 3.240 | November 30, 2021 | November 30, 2041 |  | 50000000 |
|  AUD | 28000000 | 3.040 | February 8, 2022 | February 8, 2032 |  | 28000000 |
|  AUD | 30000000 | 3.000 | March 17, 2022 | March 17, 2027 |  | 30000000 |
|  AUD | 40000000 | 5.550 | June 23, 2022 | June 23, 2032 |  | 40000000 |
|  AUD | 27000000 | 4.030 | August 10, 2022 | August 10, 2027 |  | 27000000 |
|  AUD | 30000000 | 5.060 | January 27, 2023 | January 27, 2033 |  | 30000000 |
|  AUD | 30000000 | 4.090 | April 21, 2023 | April 21, 2026 |  | 30000000 |
|  AUD | 30000000 | 5.050 | April 26, 2023 | April 26, 2033 |  | 30000000 |
|  AUD | 70000000 | 3M BBSW+0.905 | April 28, 2023 | April 28, 2028 |  | 70000000 |
|  AUD | 37000000 | 5.100 | April 28, 2023 | April 28, 2033 |  | 37000000 |
|  AUD | 30000000 | 5.000 | May 15, 2023 | May 15, 2033 |  | 30000000 |
|  AUD | 60000000 | 6.340 | November 2, 2023 | November 2, 2033 |  | 60000000 |
|  AUD | 40000000 | 6.310 | November 2, 2023 | November 2, 2033 |  | 40000000 |
|  AUD | 35000000 | 6.120 | November 28, 2023 | November 28, 2038 |  | 35000000 |
|  AUD | 32000000 | 6.150 | December 8, 2023 | December 8, 2038 |  | 32000000 |
|  AUD | 30000000 | 3M BBSW+0.77 | January 22, 2024 | January 22, 2029 |  | 30000000 |
|  AUD | 30000000 | 5.570 | January 30, 2024 | January 30, 2034 |  | 30000000 |
|  AUD | 40000000 | 3M BBSW+0.69 | October 31, 2024 | October 31, 2029 |  | 40000000 |
|  AUD | 35000000 | 5.140 | November 5, 2024 | November 5, 2032 |  | 35000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | AUD | 1466000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(8)</sup> | Subtotal in Equivalent Amount of Won<sup>(8)</sup> | Subtotal in Equivalent Amount of Won<sup>(8)</sup> | W | 1339454880000 |

---

------

##### [**Table of Contents**](#toc)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Currency** | **Original<br>Principal<br>Amount** | **Interest Rate<br>(%)** | **Issue Date** | **Maturity Date** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** |
|  IDR | 680000000000 | 6.000 | January 22, 2020 | January 22, 2025\* |  | 680000000000 |
|  IDR | 615000000000 | 6.000 | January 23, 2020 | January 23, 2025\* |  | 615000000000 |
|  IDR | 325000000000 | 6.75 | July 17, 2024 | July 17, 2029 |  | 325000000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | IDR | 1620000000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(9)</sup> | Subtotal in Equivalent Amount of Won<sup>(9)</sup> | Subtotal in Equivalent Amount of Won<sup>(9)</sup> | W | 147582000000 |
|  INR | 3712500000 | 5.980 | October 13, 2021 | October 13, 2026 |  | 3712500000 |
|  INR | 3500000000 | 7.40 | January 25, 2024 | January 25, 2029 |  | 3500000000 |
|  INR | 4000000000 | 7.25 | June 11, 2024 | June 11, 2029 |  | 4000000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | INR | 11212500000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(10)</sup> | Subtotal in Equivalent Amount of Won<sup>(10)</sup> | Subtotal in Equivalent Amount of Won<sup>(10)</sup> | W | 192742875000 |
|  NOK | 400000000 | 2.905 | July 21, 2015 | July 21, 2025 |  | 400000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | NOK | 400000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(11)</sup> | Subtotal in Equivalent Amount of Won<sup>(11)</sup> | Subtotal in Equivalent Amount of Won<sup>(11)</sup> | W | 51848000000 |
|  THB | 1500000000 | 1.580 | January 14, 2020 | January 14, 2025\* |  | 1500000000 |
|  THB | 1500000000 | 1.530 | January 15, 2020 | January 15, 2025\* |  | 1500000000 |
|  THB | 1580000000 | 1.170 | March 3, 2020 | March 3, 2025\* |  | 1580000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | THB | 4580000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(12)</sup> | Subtotal in Equivalent Amount of Won<sup>(12)</sup> | Subtotal in Equivalent Amount of Won<sup>(12)</sup> | W | 196940000000 |
|  GBP | 36000000 | 2.045 | March 18, 2022 | March 18, 2029 |  | 36000000 |
|  GBP | 25000000 | 2.190 | April 6, 2022 | April 6, 2032 |  | 25000000 |
|  GBP | 250000000 | 4.25 | October 29, 2024 | October 22, 2028 |  | 250000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | GBP | 311000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(13)</sup> | Subtotal in Equivalent Amount of Won<sup>(13)</sup> | Subtotal in Equivalent Amount of Won<sup>(13)</sup> | W | 573381370000 |
|  SGD | 20000000 | 3.700 | September 8, 2023 | September 8, 2026 |  | 20000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | SGD | 20000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(14)</sup> | Subtotal in Equivalent Amount of Won<sup>(14)</sup> | Subtotal in Equivalent Amount of Won<sup>(14)</sup> | W | 21621600000 |
|  SEK | 400000000 | 1.830 | August 10, 2017 | August 10, 2027 |  | 400000000 |
|  SEK | 400000000 | 1.815 | August 16, 2017 | August 16, 2027 |  | 400000000 |
|  SEK | 410000000 | 1.740 | November 30, 2017 | November 30, 2027 |  | 410000000 |
|  SEK | 200000000 | 2.010 | February 27, 2018 | February 27, 2028 |  | 200000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | SEK | 1410000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(15)</sup> | Subtotal in Equivalent Amount of Won<sup>(15)</sup> | Subtotal in Equivalent Amount of Won<sup>(15)</sup> | W | 187854300000 |
|  MXN | 3500000000 | TIIE28+0.20 | July 14, 2022 | July 9, 2026 |  | 3500000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | MXN | 3500000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(16)</sup> | Subtotal in Equivalent Amount of Won<sup>(16)</sup> | Subtotal in Equivalent Amount of Won<sup>(16)</sup> | W | 249095000000 |
|  JPY | 2000000000 | 0.45 | May 27, 2024 | May 27, 2026 |  | 2000000000 |
|  JPY | 8000000000 | 0.50 | August 30, 2024 | February 28, 2027 |  | 8000000000 |
|  |  | Subtotal in Original Currency | Subtotal in Original Currency | Subtotal in Original Currency | JPY | 10000000000 |
|  |  | Subtotal in Equivalent Amount of Won<sup>(17)</sup> | Subtotal in Equivalent Amount of Won<sup>(17)</sup> | Subtotal in Equivalent Amount of Won<sup>(17)</sup> | W | 93648000000 |
|  **Total External Bonds of KDB in Equivalent Amount of Won** | **Total External Bonds of KDB in Equivalent Amount of Won** | **Total External Bonds of KDB in Equivalent Amount of Won** | **Total External Bonds of KDB in Equivalent Amount of Won** | **Total External Bonds of KDB in Equivalent Amount of Won** | W | 52895553625000 |

---

\* Repaid on the respective maturity dates.

(1) U.S. dollar amounts are converted to Won amounts at the rate of US$1.00 to Won 1,470.00, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(2) New Zealand dollar amounts are converted to Won amounts at the rate of NZD 1.00 to Won 828.27, the market
average exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(3) Hong Kong dollar amounts are converted to Won amounts at the rate of HKD 1.00 to Won 189.30, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(4) Chinese offshore renminbi amounts are converted to Won amounts at the rate of CNH 1.00 to Won 201.27, the market
average exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

------

##### [**Table of Contents**](#toc)
(5) Euro amounts are converted to Won amounts at the rate of EUR 1.00 to Won 1,528.73, the market average exchange
rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(6) Swiss franc amounts are converted to Won amounts at the rate of CHF 1.00 to Won 1,626.38, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(7) Brazilian real amounts are converted to Won amounts at the rate of BRL 1.00 to Won 237.94, the prevailing market
rate on December 31, 2024.

(8) Australian dollar amounts are converted to Won amounts at the rate of AUD 1.00 to Won 913.68, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(9) Indonesian rupiah amounts are converted to Won amounts at the rate of IDR 100.00 to Won 9.11, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(10) Indian Rupee amounts are converted to Won amounts at the rate of INR 1.00 to Won 17.19, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(11) Norwegian Krone amounts are converted to Won amounts at the rate of NOK 1.00 to Won 129.62, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(12) Thai Baht amounts are converted to Won amounts at the rate of THB 1.00 to Won 43.00, the market average exchange
rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(13) Great Britain Sterling amounts are converted to Won amounts at the rate of GBP 1.00 to Won 1,843.67, the market
average exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(14) Singapore Dollar amounts are converted to Won amounts at the rate of SGD 1.00 to Won 1,081.08, the market
average exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(15) Swedish Krona amounts are converted to Won amounts at the rate of SEK 1.00 to Won 133.23, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(16) Mexican Peso amounts are converted to Won amounts at the rate of MXN 1.00 to Won 71.17, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

(17) Japanese Yen amounts are converted to Won amounts at the rate of JPY 100.00 to Won 936.48, the market average
exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(2) External Borrowings of KDB* 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Lender** | **Classifications** | **Range of<br>Interest Rates** | **Range of<br>Years of<br>Issue** | **Range of<br>Years of<br>Maturity** | **Principal Amount<br>Outstanding as of<br>December 31, 2024<sup>(1)</sup>** | **Principal Amount<br>Outstanding as of<br>December 31, 2024<sup>(1)</sup>** |
|  |  | **(%)** | | | **(millions of Won)** | **(millions of Won)** |
|  Mizuho and others | Bank loans from foreign funds | 2.96~5.59 | 2022~2024 | 2025~2028 |  | 2798873 |
|  Bank of New York Mellon, London and others | Off-shore short-term borrowings | 2.25~5.32 | 2023~2024 | 2025~2026 |  | 1757295 |
|  China Development Bank and others | Off-shore long-term borrowings | 0.40~6.91 | 2024 | 2025 |  | 1721187 |
|  Others | Short-term borrowings in foreign currency | 0.94~6.63 | 2022~2024 | 2025~2027 |  | 16412709 |
|  | Long-term borrowings in foreign currency | 2.96~5.59 | 2022~2024 | 2025~2028 |  | 1333982 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total External Borrowings of KDB** |  |  |  |  | W | 24024046 |

---

(1) Converted to Won amounts at the relevant market average exchange rates in effect on December 31, 2024 as
announced by Seoul Money Brokerage Services, Ltd.

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##### [**Table of Contents**](#toc)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;***B. Internal Debt of KDB***

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Title** | **Range of<br>Interest Rates** | **Range of<br>Years of Issue** | **Range of Years<br>of Original<br>Maturity** | **Principal<br>Amounts<br>Outstanding as<br>of December 31,<br>2024** | **Principal<br>Amounts<br>Outstanding as<br>of December 31,<br>2024** |
|  | **(%)** | | | **(millions of Won)** | **(millions of Won)** |
| **1. Bonds** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Short-term Industrial Finance Bonds | 1.00~3.60 | 2024 | 2025 | W | 4320000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Long-term Industrial Finance Bonds | 0.98~7.05 | 2007~2024 | 2013~2054 |  | 111182416 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Bonds | 0.98~7.05 | 2007~2024 | 2013~2054 |  | 115502416 |
| **2. Borrowings** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Ministry of Economy and Finance | 2.40~2.53 | 2005~2012 | 2025~2032 |  | 62184 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from Korea SMEs and Startups Agency | 1.20~2.40 | 2017~2024 | 2025~2034 |  | 64390 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Ministry of Culture, Sports and Tourism | 0.78~2.03 | 2012~2024 | 2025~2036 |  | 2946821 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from Korea Energy Agency | 0.25~1.75 | 2010~2024 | 2025~2034 |  | 280245 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others<sup>(1)</sup> | 0.00~2.91 | 2003~2024 | 2025~2044 |  | 1335404 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Borrowings<sup>(2)</sup> |  |  |  |  | 4689044 |
| **3. Other Debt<sup>(3)</sup>** |  |  |  |  | 556 |
|  Total Internal Floating Debt<sup>(4)</sup> |  |  |  |  | 4651007 |
|  Total Internal Funded Debt<sup>(5)</sup> |  |  |  |  | 115541009 |
|  **Total Internal Debt** |  |  |  | W | 120192016 |

---

(1) Includes borrowings from local governments, The Bank of Korea, the petroleum enterprises support fund and
others.

(2) Consist of short term borrowings in the amount of W 330,451 million and long term
borrowings in the amount of W 4,358,593 million.

(3) Other debt includes bonds sold under repurchase agreements and call money.

(4) Floating debt is debt that has a maturity at issuance of less than one year.

(5) Funded debt is debt that has a maturity at issuance of one year or more.

**Financial Statements and the Auditors** 

The Government elects our Auditor who is responsible for examining our financial operations and auditing our financial statements and records. The present Auditor is Jae Shin Kim, who was appointed by the Financial Services Commission for a three-year term on August 26, 2024.

We prepare our financial statements annually for submission to the Financial Services Commission, accompanied by an opinion of the Auditor. Although we are not legally required to have financial statements audited by external independent auditors, an independent public accounting firm has audited our separate and consolidated financial statements commencing with such financial statements as of and for the year ended December 31, 1998. As of the date of this prospectus, our external independent auditor is Nexia Samduk, located at 12th Floor, S&S Building, 48 Ujeongguk-ro, Jongno-gu, Seoul 03145, Korea, which has audited our separate financial statements as of and for the years ended December 31, 2024 and 2023 included in this prospectus.

Our separate financial statements appearing in this prospectus were prepared in conformity with Korean IFRS, as summarized in "—Financial Statements and the Auditors—Notes to Separate Financial Statements of December 31, 2024 and 2023—Note 2." These principles and procedures differ in certain material respects from generally accepted accounting principles in the United States.

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##### [**Table of Contents**](#toc)
**<u>Independent Auditors' Report</u>**

<u>Based on a report originally issued in Korean</u> 

The Board of Directors and Shareholders

Korea Development Bank

**Opinion** 

We have audited the accompanying separate financial statements of Korea Development Bank (the "Bank"), which comprise the separate statements of financial position as of December 31, 2024 and 2023 and the separate statements of comprehensive income, the separate statements of changes in equity and the separate statements of cash flows for the years then ended, and notes to the separate financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying separate financial statements present fairly, in all material respects, the separate financial position of the Bank as of December 31, 2024 and 2023, and its separate financial performance and its separate cash flows for the years then ended in accordance with International Financial Reporting Standards as adopted by the Republic of Korea ("Korean IFRS").

**Basis for Opinion** 

We conducted our audits in accordance with Korean Standards on Auditing. Our responsibilities under those standards are further described in the *Auditor's Responsibilities for the Audit of the Financial Statements* section of our report. We are independent of the Bank in accordance with the ethical requirements of the Republic of Korea that are relevant to our audit of the separate financial statements and we have fulfilled our other ethical responsibilities in accordance with the ethical requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

**Other Matter** 

Auditing standards and their application in practice vary among countries. The procedures and practices used in the Republic of Korea to audit such financial statements may differ from those generally accepted and applied in other countries.

**Responsibilities of Management and Those Charged with Governance for the Financial Statements** 

Management is responsible for the preparation and fair presentation of the separate financial statements in accordance with Korean IFRS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the separate financial statements, management is responsible for assessing the Bank's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Bank or to cease operations.

Those charged with governance are responsible for overseeing the Bank's financial reporting process.

**Auditor's Responsibilities for the Audit of the Financial Statements** 

Our objectives are to obtain reasonable assurance about whether the separate financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Korean Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these separate financial statements.

As part of an audit in accordance with Korean Standards on Auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Identify and assess the risks of material misstatement of the separate financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit

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##### [**Table of Contents**](#toc)
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. <br>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by management.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of
our auditor's report. However, future events or conditions may cause the Bank to cease to continue as a going concern.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the overall presentation, structure and content of the separate financial statements, including the
disclosures, and whether the separate financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

/s/ Nexia Samduk

Seoul, Korea

March 28, 2025

This report is effective as of March 28, 2025, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of reading this report, could have a material impact on the accompanying separate financial statements and notes thereto. Accordingly, the readers of the audit report should understand that the above audit report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Separate Statements of Financial Position** 

**December 31, 2024 and 2023** 

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In millions of won)** | **Notes** | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  **Assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks | 442444548 | W | 12995521 | 8659808 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL | 5444548 |  | 18418800 | 16058556 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI | 638444548 |  | 32760193 | 33888064 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost | 738444548 |  | 8936305 | 8583188 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL | 8444548 |  | 419773 | 488432 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost | 9444548 |  | 209481353 | 199981780 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets | 1044454648 |  | 13915251 | 7383325 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in subsidiaries and associates | 21147 |  | 33263341 | 30803008 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Property and equipment, net | 1247 |  | 794138 | 802084 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment property, net | 1347 |  | 62573 | 73822 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Intangible assets, net | 1447 |  | 62171 | 85461 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Defined benefit assets | 20 |  | 30968 | 68920 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current tax assets |  |  | 24196 | 13547 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | 15444548 |  | 8056518 | 10175783 |
|  **Total assets** |  | W | 339221101 | 317065778 |
|  **Liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL | 16444548 | W | 2389246 | 1920061 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits | 17444548 |  | 66100573 | 65897732 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings | 18444548 |  | 32730518 | 27745629 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | 19444548 |  | 165102269 | 156933867 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities | 1044454648 |  | 14873939 | 7654901 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Provisions | 21 |  | 814870 | 1058783 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred tax liabilities | 236 |  | 4032721 | 3978164 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current tax liabilities |  |  | 268596 | 345683 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities | 22444548 |  | 9983473 | 12100425 |
|  **Total liabilities** |  |  | 296296205 | 277635245 |
|  **Equity** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Issued capital | 123 |  | 26316559 | 23926559 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital surplus | 23 |  | 2457006 | 2468715 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accumulated other comprehensive income | 23 |  | 1236725 | 2158351 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retained earnings | 223 |  | 12914606 | 10876908 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Regulatory reserve for credit losses of W77,581 million and W211,996 million as of December 31, 2024 and 2023, respectively) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Required reversal of regulatory reserve for credit losses of W5,029 million and W134,415 million as of December 31, 2024 and 2023, respectively) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Planned reversal of regulatory reserve for credit losses of W5,029 million and W134,415 million as of December 31, 2024 and 2023, respectively) |  |  |  |  |
|  **Total equity** |  |  | 42924896 | 39430533 |
|  **Total liabilities and equity** |  | W | 339221101 | 317065778 |

---

See accompanying notes to the separate financial statements.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Separate Statements of Comprehensive Income** 

**Years ended December 31, 2024 and 2023** 

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In millions of won, except earnings per share information)** | **Notes** | **2024** | **2024** | **2023** |
|  Interest income | 24 | W | 12105864 | 11489024 |
|  Interest expense | 24 |  | (10987799) | (9927505) |
|  **Net interest income** | 47 |  | 1118065 | 1561519 |
|  Net fees and commission income | 25 |  | 487716 | 409836 |
|  Dividend income | 26 |  | 1037482 | 768370 |
|  Net gain on securities measured at FVTPL | 27 |  | 720623 | 518808 |
|  Net loss on financial liabilities measured at FVTPL | 28 |  | (51047) | (148104) |
|  Net gain (loss) on securities measured at FVOCI | 29 |  | 30359 | (9420) |
|  Net gain (loss) on derivatives | 30 |  | (829751) | 1290 |
|  Net foreign currency transaction gain | 31 |  | 864870 | 302365 |
|  Other operating expense, net | 32 |  | (471244) | (386462) |
|  **Non-interest income, net** |  |  | 1789008 | 1456683 |
|  **Reversal of credit losses** | 33 |  | (244126) | (802644) |
|  **General and administrative expenses** | 3447 |  | 857083 | 823991 |
|  **Operating income** | 47 |  | 2294116 | 2996855 |
|  Reversal of impairment loss on investments in subsidiaries and associates | 2 |  | 160887 | 972393 |
|  Other non-operating income | 35 |  | 11587 | 16524 |
|  Other non-operating expense | 35 |  | (25780) | (20103) |
|  **Non-operating expense, net** |  |  | 146694 | 968814 |
|  **Profit before income taxes** |  |  | 2440810 | 3965669 |
|  **Income tax expense** | 236 |  | 433652 | 938601 |
|  **Profit for the year** | 223 |  | 2007158 | 3027068 |
|  (Profit for the year adjusted for regulatory reserve for credit losses: W2,012,187 million and W3,161,483 million for the years ended December 31, 2024 and 2023, respectively) |  |  |  |  |
|  **Other comprehensive income for the year, net of tax Items that are or may be reclassified subsequently to profit or loss:** | 23 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net gain on securities measured at FVOCI |  |  | 119989 | 336088 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange differences on translation of foreign operations |  |  | 256500 | 20099 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation loss on cash flow hedge |  |  | (2200) | (2352) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net loss on hedges of net investments in foreign operations |  |  | (122706) | (15112) |
|  |  |  | 251583 | 338723 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Items that will not be reclassified to profit or loss:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net loss on securities measured at FVOCI |  |  | (232332) | (173433) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fair value changes on financial liabilities designated at fair value due to credit risk |  |  | (15116) | (17722) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of defined benefit liabilities |  |  | (17096) | (16138) |
|  |  |  | (264544) | (207293) |
|  |  |  | (12961) | 131430 |
|  **Total comprehensive income for the year** | 2 | W | 1994197 | 3158498 |
|  **Earnings per share** |  |  |  |  |
|  Basic and diluted earnings per share (in won) | 37 | W | 391 | 641 |

---

See accompanying notes to the separate financial statements.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Separate Statements of Changes in Equity** 

**Years ended December 31, 2024 and 2023** 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(In millions of won)** | **Issued**<br>**capital** | **Issued**<br>**capital** | **Capital**<br>**surplus** | **Accumulated<br>other<br>comprehensive<br>income** | **Retained**<br>**earnings** | **Total**<br>**equity** |
|  **Balance at January 1, 2023** | W | 23151559 | 2475310 | 2819333 | 7222171 | 35668373 |
|  Profit for the year |  |  |  |  | 3027068 | 3027068 |
|  Net gain (loss) on securities measured at FVOCI |  |  |  | (629757) | 792412 | 162655 |
|  Exchange differences on translation of foreign operations |  |  |  | 20099 |  | 20099 |
|  Valuation loss on cash flow hedge |  |  |  | (2352) |  | (2352) |
|  Net loss on hedges of net investments in foreign operations |  |  |  | (15112) |  | (15112) |
|  Fair value changes on financial liabilities designated at fair value due to credit risk |  |  |  | (17722) |  | (17722) |
|  Remeasurements of defined benefit liabilities |  |  |  | (16138) |  | (16138) |
|  **Total comprehensive income for the year** |  |  |  | (660982) | 3819480 | 3158498 |
|  Dividends |  |  |  |  | (164743) | (164743) |
|  Paid in capital increase |  | 775000 | (6595) |  |  | 768405 |
|  **Transaction with owners** |  | 775000 | (6595) |  | (164743) | 603662 |
|  **Balance at December 31, 2023** | W | 23926559 | 2468715 | 2158351 | 10876908 | 39430533 |
|  **Balance at January 1, 2024** | W | 23926559 | 2468715 | 2158351 | 10876908 | 39430533 |
|  Profit for the year |  |  |  |  | 2007158 | 2007158 |
|  Net gain (loss) on securities measured at FVOCI |  |  |  | (1021008) | 908665 | (112343) |
|  Exchange differences on translation of foreign operations |  |  |  | 256500 |  | 256500 |
|  Valuation loss on cash flow hedge |  |  |  | (2200) |  | (2200) |
|  Net loss on hedges of net investments in foreign operations |  |  |  | (122706) |  | (122706) |
|  Fair value changes on financial liabilities designated at fair value due to credit risk |  |  |  | (15116) |  | (15116) |
|  Remeasurements of defined benefit liabilities |  |  |  | (17096) |  | (17096) |
|  **Total comprehensive income for the year** |  |  |  | (921626) | 2915823 | 1994197 |
|  Dividends |  |  |  |  | (878125) | (878125) |
|  Paid in capital increase |  | 2390000 | (11709) |  |  | 2378291 |
|  **Transaction with owners** |  | 2390000 | (11709) |  | (878125) | 1500166 |
|  **Balance at December 31, 2024** | W | 26316559 | 2457006 | 1236725 | 12914606 | 42924896 |

---

See accompanying notes to the separate financial statements.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Separate Statements of Cash Flows** 

**Years ended December 31, 2024 and 2023** 

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In millions of won)** | **Notes** | **2024** | **2024** | **2023** |
|  **Cash flows from operating activities** |  |  |  |  |
|  Profit for the year |  | W | 2007158 | 3027068 |
|  Adjustments for: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income tax expense | 36 |  | 433652 | 938601 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income | 24 |  | (12105864) | (11489024) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest expense | 24 |  | 10987799 | 9927505 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividend income | 26 |  | (1037482) | (768370) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on valuation of securities measured at FVTPL | 27 |  | (541330) | (466098) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss (gain) on disposal of securities measured at FVTPL |  |  | (44189) | 4944 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net loss on financial liabilities measured at FVTPL | 28 |  | 51047 | 148104 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss (gain) on disposal of securities measured at FVOCI | 29 |  | (30359) | 9420 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Impairment loss on securities measured at amortized cost |  |  | 496 | 9011 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net loss on loans measured at FVTPL | 32 |  | 24105 | 8913 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss (gain) on valuation of derivatives |  |  | 399252 | (1088077) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net loss on fair value hedged items | 30 |  | 811454 | 1428426 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on foreign exchange translations | 31 |  | (869967) | (318814) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on disposal of investments in subsidiaries and associates | 32 |  | 6769 | 366 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal of impairment loss on investments in subsidiaries and associates |  |  | (160887) | (972393) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase (reversal) of provision for loan loss allowance | 33 |  | 90837 | (399011) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase (reversal) of provision for other assets | 33 |  | (3683) | 3104 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal of provision for payment guarantees | 21 |  | (210329) | (379837) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal of provision for unused commitments | 21 |  | (77748) | (34922) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase (reversal) of financial guarantee provision | 21 |  | (43203) | 8022 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase (reversal) of provision for possible losses from lawsuits | 21 |  | 21405 | (4) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal of provision for restoration | 21 |  | (109) | (493) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Defined benefit costs | 20 |  | 24880 | 22044 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation of property and equipment | 34 |  | 73856 | 71507 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on disposal of property and equipment | 35 |  | 792 | 1082 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on disposal of intangible assets | 35 |  | (29) | (2) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation of investment property | 35 |  | 2293 | 2273 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Amortization of intangible assets | 34 |  | 42721 | 55043 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on redemption of debentures |  |  |  | (2) |
|  |  |  | (2153821) | (3278682) |
|  Changes in operating assets and liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Due from banks |  |  | (897272) | 1985955 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  |  | (2480154) | (1850440) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL |  |  | 44554 | 44466 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost |  |  | (11429775) | (755056) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial instruments |  |  | 118150 | (186503) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets |  |  | 2324550 | (2348067) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL |  |  | 140952 | 29718 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits |  |  | 98689 | (2417870) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Defined benefit assets |  |  | (10156) | (25314) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities |  |  | (2418461) | 4791847 |
|  |  |  | (14508923) | (731264) |
|  Income taxes paid |  |  | (370177) | (15739) |
|  Interest received |  |  | 12077199 | 11262819 |
|  Interest paid |  |  | (10530167) | (9259247) |
|  Dividends received |  |  | 1037888 | 767958 |
| **Net cash provided by (used in) operating activities** |  | W | (12440843) | 1772913 |

---

*(Continued)* 

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Separate Statements of Cash Flows, Continued** 

**Years ended December 31, 2024 and 2023** 

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In millions of won)** | **Notes** | **2024** | **2024** | **2023** |
|  **Cash flows from investing activities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net decrease (increase) of securities measured at FVTPL |  | W | 538112 | (1667342) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of securities measured at FVOCI |  |  | 10710160 | 13877283 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of securities measured at FVOCI | 6 |  | (7844743) | (10636345) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Redemption of securities measured at amortized cost | 7 |  | 4708420 | 3020000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of securities measured at amortized cost | 7 |  | (5020325) | (5217386) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of property and equipment |  |  | 4108 | 12023 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of property and equipment | 12 |  | (26459) | (27092) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of intangible assets |  |  | 129 | 269 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of intangible assets | 14 |  | (18566) | (22373) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disposal of investments in subsidiaries and associates |  |  | 390644 | 320761 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acquisition of investments in subsidiaries and associates |  |  | (936925) | (667428) |
|  **Net cash provided by (used in) investing activities** |  |  | 2504555 | (1007630) |
|  **Cash flows from financing activities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase of financial liabilities measured at FVTPL |  |  | 380000 | 266200 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Decrease of financial liabilities measured at FVTPL |  |  | (123352) | (17930) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Proceeds from borrowings |  |  | 61331012 | 53493413 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Repayment of borrowings |  |  | (56510708) | (51152176) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Proceeds from issuance of debentures |  |  | 114684239 | 124728281 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Repayment of debentures |  |  | (107791891) | (128327695) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Decrease in lease liabilities |  |  | (33273) | (24477) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends |  |  | (878125) | (164743) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Paid in capital increase |  |  | 378511 | 336268 |
|  **Net cash provided by (used in) financing activities** |  |  | 11436413 | (862859) |
|  **Effects from changes in foreign currency exchange rate for cash and cash equivalents held** |  |  | 514311 | 85684 |
|  **Net increase (decrease) in cash and cash equivalents** |  |  | 2014436 | (11892) |
|  **Cash and cash equivalents at beginning of the year** |  |  | 11860577 | 11872469 |
|  **Cash and cash equivalents at end of the year** | 42 | W | 13875013 | 11860577 |

---

See accompanying notes to the separate financial statements.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**1. <u>Reporting Entity</u>** 

Korea Development Bank (the "Bank") was established on April 1, 1954, in accordance with *The Korea Development Bank Act* to finance and manage major industrial projects.

The Bank is engaged in the banking industry under *The Korea Development Bank Act* and other applicable statutes, and in the fiduciary in accordance with *the Financial Investment Services and Capital Markets Act*.

Korea Finance Corporation (KoFC), the former ultimate parent company, and KDB Financial Group Inc. (KDBFG), the former immediate parent company, were established by spin-offs of divisions of the Bank as of October 28, 2009. KoFC and KDBFG were merged into the Bank, effective as of December 31, 2014. Issued capital is W26,316,559 million with 5,263,311,768 shares of issued and outstanding as of December 31, 2024 and 100% of the Bank's shares are owned by the government of the Republic of Korea.

The Bank's head office is located in 14, Eunhaeng-ro (Yeouido-dong), Yeongdeungpo-gu, Seoul and its service network as of December 31, 2024 is as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Domestic** | **Domestic** | **Overseas** | **Overseas** | **Overseas** | |
|  | **Head Office** | **Branches** | **Branches** | **Subsidiaries** | **Representative<br>offices** |<br>**Total** |
|  KDB | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;60 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;86 |

---

**2. <u>Basis of Preparation</u>** 

***(1) Application of accounting standards***

These separate financial statements have been prepared in accordance with the Korean International Financial Reporting Standards ("Korean IFRS") enacted by the *Act on External Audit of Stock Companies*.

***(2) Changes and disclosures of accounting policies***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) New and amended standards adopted***

The Bank newly applied the following amended and enacted standards for the annual period beginning on January 1, 2024. The nature and the impact of each new standard or amendment are described below:

*Amendment of Korean IFRS No.1001 "Presentation of Financial Statements"—Classification of Liabilities into Current and Non-Current and Non-current Liabilities with Covenants* 

Liabilities are classified as current or non-current based on their substantive rights existing at the end of the reporting period, without considering the possibility of exercising the right to delay the payment or management's expectations. Also, if the transfer of equity instruments is included in the payment of liabilities, it is excluded if the option to pay with equity instruments is recognized separately from the liability in a compound financial instrument and meets the definition of equity instruments. These amendments do not have a significant impact on the financial statements.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**2. <u>Basis of Preparation, Continued</u>**

*Amendment of Korean IFRS No.1007 "Statement of Cash Flows" and No.1107 "Financial Instruments: Disclosures"—Disclosure of Supplier Finance Arrangements* 

The amendments require disclosure of the effects of supplier finance arrangements on the Bank's liabilities, cash flows and exposure to liquidity risk. These amendments do not have a significant impact on the financial statements.

*Amendment of Korean IFRS No.1116 "Leases"—Lease Liability in a Sale and Leaseback* 

The amendments require a seller-lessee to subsequently measure lease liabilities arising from a leaseback in a way that it does not recognize any amount of the gain or loss that relates to the right of use it retains. These amendments do not have a significant impact on the financial statements.

*Amendment of Korean IFRS No.1001 "Presentation of Financial Statements"—Disclosure of Virtual Asset* 

The amendments require additional disclosure for virtual assets held by the Bank, virtual assets entrusted by customers to the Bank, and the issuance and transfer of virtual assets. These amendments do not have a significant impact on the financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) New standards and interpretations issued but not effective***

The following new standards, interpretations and amendments to existing standards have been issued but not effective for annual periods beginning after January 1, 2024, and the Bank has not early adopted them. The nature and the impact of each new standard, amendment and enactments are described below:

*Amendment of Korean IFRS No.1021 "The Effects of Changes in Foreign Exchange Rates" and Korean IFRS No.1101 "First-time Adoption of International Financial Reporting Standards"—Lack of exchangeability* 

The amendments require the Bank to determine a spot exchange rate when exchangeability is lacking, and to disclose information on the nature and financial effects of the currency not being exchangeable into the other currency, the spot exchange rate(s) used, the estimation process, and the risks to which the Bank is exposed. This amendment will be applied to the financial statements for the accounting year beginning on or after January 1, 2025. These amendments do not have a significant impact on the financial statements.

*Amendment of Korean IFRS No.1109 "Financial Instruments" and No.1107 "Financial Instruments: Disclosures"* 

The amendments address practical concerns and introduce new requirements, such as permitting the deeming of financial liabilities as settled (derecognized) through an electronic payment system if certain criteria are met before the payment date. It also includes additional disclosures for equity instruments designated as financial assets measured at fair value through other comprehensive income. This amendment will be effective for annual reporting periods beginning on or after January 1, 2026. The Bank is currently reviewing the impact of these amendments on its financial statements

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**2. <u>Basis of Preparation, Continued</u>**

*Korean IFRS Accounting Standards Annual Improvements Volume 11* 

Korean IFRS Accounting Standards Annual Improvements Volume 11 will be effective for annual reporting periods beginning on or after January 1, 2026. These amendments do not have a significant impact on the financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Korean IFRS No.1101 "First-time adoption of International Financial Reporting Standards": Hedge
accounting by a first-time adopter

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Korean IFRS No.1107 "Financial Instruments: Disclosures": Gain or loss on derecognition, Application
guidance

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Korean IFRS No.1109 "Financial Instruments": Derecognition of lease liabilities, Definition of
transaction price

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Korean IFRS No.1110 "Consolidated Financial Statements": Determination of a 'de facto
agent'

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Korean IFRS No.1007 "Statement of Cash Flows": Cost method

***(3) Basis of measurement***

The financial statements have been prepared on the historical cost basis except for the following material items in the statement of financial position:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Derivative financial instruments measured at fair value

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Financial instruments measured at fair value through profit or loss

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Financial instruments measured at fair value through other comprehensive income

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Fair value hedged financial instruments with changes in fair value, due to hedged risks, recognized in profit or
loss

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Liabilities for defined benefit plans, which are recognized as net of the total present value of defined benefit
obligations less the fair value of plan assets.

***(4) Functional and presentation currency***

These financial statements are presented in Korean won ("W"), which is the Bank's functional currency and the currency of the primary economic environment in which the Bank operates.

The following are the key assumptions concerning the future and other key sources of estimation uncertainty at the end of the reporting period that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year:

***(5) Use of estimates and judgments***

The preparation of the financial statements in conformity with K-IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Management's estimates of outcomes may differ from actual

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**2. <u>Basis of Preparation, Continued</u>**

outcomes if management's estimates and assumptions based on management's best judgment at the reporting date are different from the actual environment.

Estimates and assumptions are continually evaluated and any change in an accounting estimate is recognized prospectively by including it in profit or loss in the period of the change, if the change affects that period only.

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Fair value of financial instruments***

Financial instruments measured at fair value through profit or loss and other comprehensive income, and derivative instruments are recognized and measured at fair value. If the market for a financial instrument is not active, fair value is determined either by using a valuation technique or independent third-party valuation service. Valuation techniques include using recent arm's length market transactions between knowledgeable, willing parties, if available, referencing to the current fair value of another instrument that is substantially the same, discounted cash flow analysis and option pricing models.

Financial instruments, which are not actively traded in the market and those with less transparent market prices, will have less objective fair values and require broad judgment on liquidity, concentration, uncertainty in market factors and assumptions in price determination and other risks.

Diverse valuation techniques are used to determine the fair value of financial instruments, from generally accepted market valuation models to internally developed valuation models that incorporate various types of assumptions and variables.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Credit losses allowance***

The Bank tests impairment and recognizes loss allowances on financial assets classified at amortized cost, debt instruments measured at fair value through other comprehensive income and recognizes provisions for payment guarantee, financial guarantee and unused commitments. Accuracy of allowances and provisions for credit losses is dependent upon estimation of expected cash flows of the borrower for individually assessed allowances of loans, and upon assumptions and methodology used for collectively assessed allowances for groups of loans, guarantees and unused loan commitments.

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Deferred taxes***

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date. Deferred income tax assets are recognised to the extent that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Actual income taxes in the future may not be identical to the recognised deferred tax assets and liabilities.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**2. <u>Basis of Preparation, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;***(iv) Defined benefit liabilities***

The Bank operates a defined benefit plan. Defined benefit liability is calculated by annual actuarial valuations as of the reporting date. To perform the actuarial valuations, assumptions for discount rates, future salary increases and others are required to be estimated. Defined benefit plans contain significant uncertainties in estimations due to its long-term nature.

***(6) Restatement of prior year financial statements for comparative presentation***

In order to proceed with the sale of its shares in HMM Co., Ltd., the Bank selected the Pan Ocean-JKL consortium as the preferred bidder on December 18, 2023, and classified the shares as assets held for sale. However, as negotiations with the preferred bidder broke down on February 7, 2024, the shares were retrospectively reclassified as investments in associates from the date they were initially classified as assets held for sale. Accordingly, the comparative statement of financial position as of December 31, 2023 and the statement of comprehensive income for the year ended December 31, 2023 have been restated.

The major adjustments to each item resulting from the reclassification are as follows.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **As previously<br>reported** | **As previously<br>reported** | **Restated** | **Changes** |
|  Investments in subsidiaries and associates | W | 26870568 | 30803008 | 3932440 |
|  Assets held for sale |  | 3228444 |  | (3228444) |
|  Deferred tax liabilities |  | 3792309 | 3978164 | 185855 |
|  Retained earnings |  | 10358767 | 10876908 | 518141 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** |
|  | **As previously<br>reported** | **As previously<br>reported** | **Restated** | **Changes** |
|  Reversal of impairment loss on investments in subsidiaries and associates | W | &nbsp;&nbsp;&nbsp;&nbsp;562550 | 972393 | 409843 |
|  Other non-operating expense |  | 314256 | 20103 | (294153) |
|  Income tax expense |  | 752746 | 938601 | 185855 |
|  Profit for the year |  | 2508927 | 3027068 | 518141 |

---

***(7) Approval date for the separate financial statements***

The separate financial statements were authorized for issue by the Board of Directors on March 27, 2025, which will be submitted for approval to the shareholders' meeting to be held on March 28, 2025.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies</u>** 

The significant accounting policies applied by the Bank in preparation of its separate financial statements are included below. The accounting policies set out below have been applied consistently to all periods presented in these separate financial statements.

***(1) Investments in subsidiaries and associates***

The accompanying financial statements are separate financial statements in accordance with K-IFRS 1027 *'Separate Financial Statements'* and investments in subsidiaries and associates are accounted for at cost, not by performance and net asset reported by the investee. Dividends received from subsidiaries and associates are recognised as income as of the time the right to receive the dividends is established.

***(2) Business combination of entities under common control***

The assets and liabilities acquired under business combinations under common control are recognised at the carrying amounts recognised previously in the consolidated financial statements of the ultimate parent. The difference between consideration transferred and carrying amounts of net assets acquired is recognised as part of share premium.

***(3) Operating segments***

The Bank makes decisions regarding allocation of resources to segments and categorizes segments, based on internal reports reviewed periodically by the chief operating decision maker, to assess performance. Information on segments reported to the chief operating decision maker includes items directly attributable to segments as well as those that can be allocated on a reasonable basis. Unallocated items mainly comprise corporate assets (such as the Bank Headquarters), head office expenses, and income tax assets and liabilities. The Bank recognises the CEO as the chief operating decision maker.

***(4) Foreign exchange***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Foreign currency transactions***

Transactions in foreign currencies are translated to the functional currency of the Bank, at exchange rates of the dates of transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the exchange rate at that date. The foreign currency gain or loss on monetary items is the difference between amortized cost in the functional currency at the beginning of the period, adjusted for effective interest and payments during the period, and the amortized cost in foreign currency translated at the exchange rate at the end of the reporting period. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated to the functional currency at the exchange rate at the date that the fair value was determined.

Foreign currency differences arising on transactions and translations of monetary items are recognised in profit or loss, except for differences arising on the translation of a financial instruments designated as hedges of the net investment in foreign operations, or cash flow hedge, which are recognised in other comprehensive income.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

When a gain or loss on a non-monetary item is recognised in other comprehensive income, any exchange component of that gain or loss is recognised in other comprehensive income. Conversely, when a gain or loss on a non-monetary item is recognised in profit or loss, any exchange component of that gain or loss shall be recognised in profit or loss.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Foreign operations***

If the presentation currency of the Bank is different from a foreign operation's functional currency, the financial statements of the foreign operation are translated into the presentation currency using the following methods:

Unless the functional currency of foreign operations is in a state of hyperinflation, assets and liabilities of foreign operations are translated at the closing exchange rate at the end of the reporting period. Revenues and expenses on the statement of comprehensive income are translated at the exchange rates of the date of transaction. Foreign currency differences that arise from translation are recognized as other comprehensive income, and the disposal of a foreign operation is re-categorized as profit or loss as of the moment of the disposal profit or loss is recognized.

Any goodwill arising on the acquisition of a foreign operation, and any adjustments in fair value to the carrying amounts of assets and liabilities due to such acquisition, are treated as assets and liabilities of the foreign operation. Therefore, such are expressed in the functional currency of the foreign operations and, alongside other assets and liabilities of the foreign operation, translated at the closing exchange rate.

In the case of the disposal of a foreign operation, cumulative amounts of exchange difference regarding the foreign operation, recognized separately from other comprehensive income, are re-categorized from assets to profit or loss as of the disposal profit or loss is recognized.

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Foreign exchange of net investment in foreign operations***

Monetary items receivable from or payable to a foreign operation, with none or little possibility of being settled in the foreseeable future, are considered a part of the net investment in the foreign operation. Therefore, the exchange difference is recognised as comprehensive income or loss in the financial statement and re-categorized to profit or loss as of the disposal of the related net investment.

***(5) Recognition and measurement of financial instruments***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Initial recognition***

The Bank recognizes a financial asset or a financial liability in its separate statement of financial position when the Bank becomes a party to the contractual provisions of the instrument. A regular way purchase or sale of financial assets is recognized and derecognized using trade date accounting.

The Bank classifies financial assets as financial assets at fair value through profit or loss, financial assets at fair value through other comprehensive income, or financial assets at amortized cost on the basis of the Bank's business model for managing the financial assets and the contractual cash flow characteristics of the financial assets. The Bank classifies financial liabilities as financial liabilities at fair value through profit or loss, or financial liabilities at amortized cost.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

At initial recognition, a financial asset or financial liability is measured at its fair value plus or minus, in the case of a financial asset or financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Subsequent measurement***

After initial recognition, financial instruments are measured at amortized cost or fair value based on classification at initial recognition.

*Amortized cost* 

The amortized cost is the amount at which the financial asset or financial liability is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortization using the effective interest method of any difference between that initial amount and the maturity amount and, for financial assets, adjusted for any loss allowance.

*Fair value* 

Fair values, which the Bank primarily uses for the measurement of financial instruments, are the published price quotations based on market prices or dealer price quotations of financial instruments traded in an active market where available. These are the best evidence of fair value. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, an entity in the same industry, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm's length basis.

If the market for a financial instrument is not active, fair value is determined either by using a valuation technique or independent third-party valuation service. Valuation techniques include using recent arm's length market transactions between knowledgeable, willing parties, if available, referencing to the current fair value of another instrument that is substantially the same, discounted cash flow analysis and option pricing models.

The Bank uses valuation models that are commonly used by market participants and customized for the Bank to determine fair values of common over-the-counter ("OTC") derivatives such as options, interest rate swaps and currency swaps which are based on the inputs observable in markets. For more complex instruments, the Bank uses internally developed models, which are usually based on valuation methods and techniques generally used within the industry, or a value measured by an independent external valuation institution as the fair values if all or some of the inputs to the valuation models are not market observable and therefore it is necessary to estimate fair value based on certain assumptions.

If the valuation technique does not reflect all factors which market participants would consider in setting a price, the fair value is adjusted to reflect those factors. Those factors include counterparty credit risk, bid-ask spread, liquidity risk and others.

The chosen valuation technique makes maximum use of market inputs and relies as little as possible on entity-specific inputs. It incorporates all factors that market participants would consider in setting a price and is consistent with economic methodologies applied for pricing financial instruments. Periodically, the Bank

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

calibrates the valuation technique and tests its validity using prices of observable current market transactions of the same instrument or based on other relevant observable market data.

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Derecognition***

Derecognition is the removal of a previously recognized financial asset or financial liability from the statement of financial position. The Bank derecognizes a financial asset or a financial liability when, and only when:

*Derecognition of financial assets* 

Financial assets are derecognized when the contractual rights to the cash flows from the financial assets expire or the financial assets have been transferred and substantially all the risks and rewards of ownership of the financial assets are also transferred, or all the risks and rewards of ownership of the financial assets are neither substantially transferred nor retained and the Bank has not retained control. If the Bank neither transfers nor disposes of substantially all the risks and rewards of ownership of the financial assets, the Bank continues to recognize the financial asset to the extent of its continuing involvement in the financial asset.

If the Bank transfers the contractual rights to receive the cash flows of the financial asset, but retains substantially all the risks and rewards of ownership of the financial asset, the Bank continues to recognize the transferred asset in its entirety and recognize a financial liability for the consideration received.

*Derecognition of financial liabilities* 

Financial liabilities are derecognized from the statement of financial position when the obligation specified in the contract is discharged, cancelled or expires.

&nbsp;&nbsp;&nbsp;&nbsp;***(iv) Offsetting***

Financial assets and liabilities are offset and the net amount reported in the separate statements of financial position where there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the assets and settle the liability simultaneously.

***(6) Cash and cash equivalents***

Cash and cash equivalents comprise balances with original maturities of three months or less from the date of acquisition that are subject to an insignificant risk of changes in their fair value, including cash on hand, deposits held at call with banks and other highly liquid short-term investments with original maturities of three months or less.

***(7) Non-derivative financial assets***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Financial assets at fair value through profit or loss***

Any non-derivative financial asset classified as held for trading or not classified as financial assets at fair value through other comprehensive income or financial assets measured at amortized cost is categorized under financial assets at fair value through profit or loss.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

The Bank may designate certain financial assets upon initial recognition as at fair value through profit or loss when the designation eliminates or significantly reduces a measurement or recognition inconsistency (sometimes referred to as 'an accounting mismatch') that would otherwise arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases.

After initial recognition, a financial asset at fair value through profit or loss is measured at fair value and gains or losses arising from a change in the fair value are recognized in profit or loss. Interest income and dividend income from financial assets at fair value through profit or loss are also recognized in profit or loss.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Financial assets at fair value through other comprehensive income***

The Bank classifies financial assets as financial assets at fair value through other comprehensive income if they meet the following conditions: 1) debt instruments that are a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and consistent with representing solely payments of principal and interest on the principal amount outstanding or 2) equity instruments, not held for trading with the objective of generating a profit from short-term fluctuations in price or dealer's margin, designated as financial assets at fair value through other comprehensive income.

After initial recognition, a financial asset at fair value through other comprehensive income is measured at fair value. Gain and loss from changes in fair value, other than dividend income and interest income amortized using effective interest method and exchange differences arising on monetary items which are recognized directly in profit or loss, are recognized as other comprehensive income in equity.

At disposal of financial assets at fair value through other comprehensive income, cumulative gain or loss is recognized as profit or loss for the reporting period. However, cumulative gain or loss of equity instrument designated as fair value through other comprehensive income are not recycled to profit or loss at disposal.

Financial assets at fair value through other comprehensive income denominated in foreign currencies are translated at the closing rate. Exchange differences resulting from changes in amortized cost are recognized in profit or loss, and other changes are recognized as equity.

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Financial assets measured at amortized cost***

A financial asset, which are held within the business model whose objective is to hold assets in order to collect contractual cash flows and consistent with representing solely payments of principal and interest on the principal amount outstanding, are classified as a financial asset at amortized cost. Financial assets at amortized cost are subsequently measured at amortized cost using the effective interest method after initial recognition and interest income is recognized using the effective interest method.

***(8) Expected credit loss of financial assets***

The Bank measures expected credit loss and recognizes loss allowance at the end of the reporting period for financial assets measured at amortized cost and fair value through other comprehensive income with the exception of financial asset measured at fair value through profit or loss.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

The expected credit loss ("ECL") is the weighted average amount of possible outcomes within a certain range, reflecting the time value of money, estimates on the past, current and future situations, and information accessible without excessive cost of effort.

The Bank uses the following three measurement techniques in accordance with K-IFRS:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• General approach: for financial assets and off-balance-sheet unused
credit line that are not applied below two approaches

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Simplified approach: for receivables, contract assets and lease receivables

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Credit-impaired approach: for purchased or originated credit-impaired financial assets

The general approach is applied differently depending on the significance of the increase of the credit risk. If, at the reporting date, the credit risk on a financial instrument has not increased significantly since initial recognition, an entity shall measure the loss allowance for that financial instrument at an amount equal to 12-month expected credit losses. If the credit risk on that financial instrument has increased significantly since initial recognition, an entity shall measure the loss allowance for a financial instrument at an amount equal to the lifetime expected credit losses at each reporting date.

The Bank applies the simplified approach to 1) trade receivables and contract assets that do not have a significant financing component or 2) trade receivables, contract assets and lease receivables upon determining the Bank's accounting policies as the application of the simplified approach. The approach requires expected lifetime losses to be recognized from initial recognition of the financial assets. Under credit-impaired approach, the Bank shall only recognize the cumulative changes in lifetime expected credit losses since initial recognition as a loss allowance for purchased or originated credit-impaired financial assets.

The following non-exhaustive list of information may be relevant in assessing changes in credit risk:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Significant changes in internal price indicators of credit risk as a result of a change in credit risk since
inception

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Other changes in the rates or terms of an existing financial instrument that would be significantly different if
the instrument was newly originated or issued at the reporting date

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• An actual or expected significant change in the financial instrument's external credit rating

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• An actual or expected internal credit rating downgrade for the borrower or decrease in behavioural scoring used
to assess credit risk internally

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• An actual or expected significant change in the operating results of the borrower

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Past due information

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Forward-looking information***

The Bank uses forward-looking information, when it determines whether the credit risk has increased significantly since initial recognition and measures expected credit losses.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

The Bank assumes the risk component has a certain correlation with the business cycle, and calculates the expected credit loss by reflecting the forward-looking information with macroeconomic variables on the measurement inputs.

Forward looking information used in calculation of expected credit loss is derived after comprehensive consideration of a variety of factors including scenario in management planning, worst-case scenario used for stress testing, third party forecast, and others.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Measuring expected credit losses on financial assets at amortized cost***

The amount of the loss on financial assets at amortized cost is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows discounted at the financial asset's original effective interest rate. The Bank estimates expected future cash flows for financial assets that are individually significant (individual assessment of impairment).

For financial assets that are not individually significant, the Bank collectively estimates expected credit loss by grouping loans with homogeneous credit risk profile (collective assessment of impairment).

*Individual assessment of impairment* 

Individual assessment of impairment losses is calculated using management's best estimate on present value of expected future cashflows. The Bank uses all the available information including operating cash flow of the borrower and net realizable value of any collateral held.

*Collective assessment of impairment* 

Collective assessment of loss allowance involves historical loss experience along with incorporation of forward-looking information. Such process incorporates factors such as type of collateral, product and borrowers, credit rating, size of portfolio and recovery period and applies probability of default on a group of assets and loss given default by type of recovery method. Also, the expected credit loss model involves certain assumption to determine input based on loss experience and forward-looking information. These models and assumptions are periodically reviewed to reduce gap between loss estimate and actual loss experience.

The expected credit loss for financial assets measured at amortized cost is recognized as the loss allowance, and when the financial asset is determined to be irrecoverable, the carrying amount and loss allowance are decreased. If financial assets previously written off are recovered, the loss allowance is increased and the difference is recognized in the current profit or loss.

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Measuring expected credit losses on financial assets at fair value through other comprehensive income***

Measuring method of expected credit losses on financial assets at fair value through other comprehensive income is equal to the method of financial assets at amortized cost, except for changes in loss allowances that are recognized as other comprehensive income. Amounts recognized in other comprehensive income for sale or repayment of financial assets at fair value through other comprehensive income are reclassified to profit or loss.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

***(9) Derivative financial instruments including hedge accounting***

Derivative financial instruments are initially recognised at fair value at the inception of the contract and re-estimated at fair value subsequently. The recognition of profit or loss due to changes in fair value of derivative instruments is as described below:

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Hedge accounting***

Derivative financial instruments are accounted differently depending on whether hedge accounting is applied, and therefore, are classified into trading purpose derivatives and hedging purpose derivatives.

Upon the transaction of hedging purpose derivatives, two different types of hedge accounting are applied; a fair value hedge, and a cash flow hedge. A fair value hedge is a hedge of the exposure to changes in fair value of a recognised asset or liability or an unrecognised firm commitment, or an identified portion of such an asset, liability or firm commitment, that is attributable to a particular risk and could affect profit or loss. A cash flow hedge is a hedge of the exposure to variability in cash flows that (i) is attributable to a particular risk associated with a recognised asset or liability (such as all or some future interest payments on variable rate debt) or a highly probable forecast transaction and (ii) could affect profit or loss.

At the inception of the hedge relationship, the Bank formally documents the relationship between the hedged item and the hedging instrument, including the nature of the risk, the objective and strategy for undertaking the hedge, and the method that will be used to assess the effectiveness of the hedging relationship.

*Fair value hedge* 

For designated and qualifying fair value hedges, the change in the fair value of a hedging derivative is recognised in profit or loss in the statement of comprehensive income. Meanwhile, the change in the fair value of the hedged item, attributable to the risk hedged, is recorded as part of the carrying value of the hedged item and is also recognised in profit or loss in the statement of comprehensive income. When the hedge no longer meets the criteria for hedge accounting, the hedge relationship is terminated. For hedged item recorded at amortized cost, the difference between the carrying value of the hedged item on termination and the face value is amortized over the remaining term of the original hedge using the EIR.

*Cash flow hedge* 

For designated and qualifying cash flow hedges, the effective portion of gain or loss on the hedging instruments is initially recognised directly in equity. The ineffective portion of the gain or loss on the hedging instrument is recognised immediately in the statement of comprehensive income. When the hedged cash flow affects the profit or loss in statement of comprehensive income, the gain or loss on the hedging instrument is recorded in the corresponding income or expense line in profit or loss in the statement of comprehensive income. When a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the hedged forecasted transaction is ultimately recognised in the statement of comprehensive income. When a forecasted transaction is no longer expected to occur, the cumulative gain and loss that was reported in equity is immediately transferred to profit or loss in the statement of comprehensive income.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

*Hedges of net investments in foreign operations* 

The Bank designates non-derivative financial instruments as hedging instruments for foreign currency risk arising from net investments in foreign operations and recognises the portion of the gain or loss on the hedging instrument that is determined to be an effective hedge in other comprehensive income. The cumulative amounts recognised in other comprehensive income relating to both the foreign exchange differences arising on translation of the results and financial position of the foreign operation and the gain or loss on the hedging instrument that is determined to be an effective hedge of the net investment are reclassed from equity to profit or loss as a reclassification adjustment when the Bank disposes of the foreign operation.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Trading purpose derivatives***

For trading purpose derivatives transaction, changes in the fair value of derivatives are recognised in net income.

***(10) Day one profit or loss recognition***

For financial instruments classified as level 3 on the fair value level hierarchy measured using assess variables not observable in the market, the difference between the fair value at initial recognition and the transaction price, which is equivalent to Day one profit or loss, is amortized by using the straight-line method over time.

***(11) Property and equipment***

The Bank's property and equipment are recognised at the carrying amount at historical costs less accumulated depreciation and accumulated impairment in value. Historical costs include the expenditures directly related to the acquisition of assets.

Subsequent costs are recognised in the carrying amount of assets or, if appropriate, as separate assets if the probabilities future economic benefits associated with the assets will flow into the Bank and the costs can be measured reliably; the carrying amount of the replaced part is derecognised. Furthermore, any other repairs or maintenances are charged to profit or loss as incurred.

Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to the amount of residual value less acquisition cost over the following estimated useful lives:

---

| | |
|:---|:---|
| **Type** | **Useful lives (years)** |
|  Buildings | 20 ~ 50 |
|  Structure | 10 ~ 40 |
|  Movable property | 4 |

---

Property and equipment are impaired when the carrying amount exceeds the recoverable amount. The Bank assesses residual value and economic life of its assets at each reporting date and adjusts useful lives when necessary. Any gain or loss arising from the disposal of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is recognised in non-operating income (expense) in the statement of comprehensive income.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

***(12) Investment property***

The Bank classifies property held for rental income or benefits from capital appreciation as investment property. Investment property is measured initially at cost, including transaction costs. Subsequent to initial recognition, the cost model is applied. Subsequent to initial recognition, an item of investment property is carried at its cost less any accumulated depreciation and any accumulated impairment loss.

Investment properties are derecognised either when they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in the statement of comprehensive income in the period of de-recognition. Reclassification to other account is made if there is a change in use of corresponding investment property.

Depreciation of investment property is calculated using the straight-line method over its estimated useful lives as follows:

---

| | | |
|:---|:---|:---|
| **Type** | **Useful lives (years)** | **Useful lives (years)** |
|  Buildings |  | 20 ~ 50 |
|  Structure |  | 10 ~ 40 |

---

***(13) Intangible assets***

An intangible asset is recognised only when its cost can be measured reliably, and the probabilities future economic benefits from the asset will flow into the Bank are high. Separately acquired intangible assets are recognised at the acquisition cost, and subsequently, the cost less accumulated depreciation and accumulated impairment is recognised as the carrying amount.

Intangible assets with finite lives are amortized over the four-year to 30-year period of useful economic lives using the straight-line method. At the end of each reporting period, the Bank reviews intangible assets for any evidence that indicate impairment, and upon the presence of such evidence, the Bank estimates the amount recoverable and recognises the loss accordingly.

Intangible assets with indefinite useful lives are not amortized but are tested for impairment annually. Furthermore, the Bank reviews such intangible assets to determine whether it is appropriate to consider these assets to have indefinite useful lives. If in the case the Bank concludes an asset is not qualified to be classified as non-finite, prospective measures are taken to consider such an asset as finite.

***(14) Leases***

The Bank recognizes a right-of-use asset representing its right to use the underlying leased asset and a lease liability representing its obligation to make lease payments at the commencement date of the lease. The Bank elected not to apply the requirements to the short-term leases and leases of low value assets.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

*Right-of-use asset* 

The right-of-use asset is measured at its cost less subsequent accumulated depreciation and accumulated impairment loss with adjustments reflected arising from remeasurements of the lease liability. The cost of the right-of-use asset comprise the amount of the initial measurement of the lease liability, any initial direct costs incurred by the lessee and any lease payments made at or before the commencement date, less any lease incentive received. The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis from the commencement date of the lease.

*Lease liabilities* 

At the commencement date, the lease liability is measured at present value of the lease payments that are not paid at that date. Lease payments include fixed payments (including in-substance fixed payments), less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be payable by the lessee under residual value guarantees, the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease. The variable lease payments that do not depend on an index or a rate are recognized as an expense in the period in which the event or condition that triggers those payments occurs.

When measuring the present value, the lease payments are discounted using the interest rate implicit in the lease. If such implicit rate cannot be readily determined, the Bank uses the Bank's incremental borrowing rate. The lease liability is subsequently increased by the amount of interest expenses recognized on the lease liability and reduced by the lease payments made.

*Short-term lease and lease of low-value assets* 

The Bank does not apply the requirements of lessee accounting to short-term leases and leases of low-value assets. The Bank recognizes the lease payments associated with these leases as expenses on a straight-line basis over the lease term.

***(15) Impairment of non-financial assets***

The Bank tests for any evidence of impairment in assets and reviews whether the impairment has taken place by estimating the recoverable amount, at the end of each reporting period. The recoverable amount is the higher of the fair value less cost and value in use of an asset.

Except for impairment losses in respect of goodwill which are never reversed, an impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceeds the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

***(16) Assets held for sale***

Non-current assets, or disposal groups comprising assets and liabilities, that are expected to be recovered primarily through sale rather than through continuing use, are classified as held for sale. To be classified as held for sale, the asset (or disposal group) must be available for immediate sale in its present condition and its sale must be highly probable. The assets or disposal group that are classified as assets held for sale are measured at the lower of their carrying amount and fair value less cost to sell.

The Bank recognizes an impairment loss for any initial or subsequent write-down of an asset (or disposal group) to fair value less costs to sell, and a gain for any subsequent increase in fair value less costs to sell, up to the cumulative impairment loss previously recognized.

Non-current assets that are classified as held for sale or part of a disposal group classified as held for sale are not depreciated (or amortized).

***(17) Non-derivative financial liabilities***

The Bank classifies non-derivative financial liabilities into financial liabilities at fair value through profit or loss or other financial liabilities, in accordance with the substance of the contractual arrangement and the definitions of financial liability. The Bank recognizes these financial liabilities in the statement of financial position when the Bank becomes a party to the contractual provisions of the financial liability.

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Financial liabilities at fair value through profit or loss***

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated at FVTPL upon initial recognition. Financial liabilities and derivatives are classified as financial instruments held for trading if they are acquired for repurchasing soon. Financial liabilities are classified as financial liabilities at FVTPL upon initial recognition, if the profit or loss from the liabilities indicates to be more purpose-appropriate to be recognised as profit or loss. Financial liabilities at FVTPL are designated at fair value in subsequent measurements, and any related un-realized profit or loss is recognised as profit or loss. In addition, for the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability, the Bank present this change in other comprehensive income, and does not recycle this other comprehensive income to profit or loss, subsequently.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Financial liabilities measured at amortized cost***

Financial liabilities measured at amortized cost are recognised at fair value less cost less transaction cost upon initial recognition, and subsequently at amortized costs. The difference between the proceeds (net of transaction cost) and the redemption value is recognised in the statement of comprehensive income over the periods of the liabilities using the effective interest method.

Fees paid on the establishment of a loan facility are recognised as transaction costs of the loan, if the probability that some or all the facility will be drawn down is high. If, however, there is not enough evidence to conclude a draw-down of some or all the facility will occur, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the facility to which it relates.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

***(18) Employee benefits***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Short-term employee benefits***

Short-term employee benefits are employee benefits that are due to be settled wholly before 12 months after the end of the period in which the employees render the related service. When an employee has rendered service to the Bank during an accounting period, the Bank recognises the undiscounted amount of short-term employee benefits expected to be paid in exchange for that service.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Retirement benefits: defined contribution plans***

A defined contribution plan is a pension plan under which the Bank pays fixed contributions into a separate fund. The Bank is no longer responsible for any foreseeable future liability after a certain amount or percentage of money is set aside for defined contribution plans. If the pension plan allows for early retirement, payments are recognised as employee benefits. If the contribution already paid exceeds the contribution due for service before the end of the reporting period, the Bank recognises that excess as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund.

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Retirement benefits: defined benefit plans***

The Bank classifies all the pensions as defined benefit plans except defined contribution plans. The Bank's net obligation in respect of defined benefit plans is calculated by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets. The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid and have terms to maturity like the terms of the related pension liability.

Remeasurements of the net defined benefit liabilities (assets), which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognised immediately in other comprehensive income.

***(19) Provisions***

Provisions are recognized when the Bank has a present legal or constructive obligation because of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

***(20) Financial guarantees***

Financial guarantee contracts are contracts that require the issuer (the Bank) to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due, in accordance with the original or changed terms of a debt instrument. Financial guarantees are initially recognized in the financial statements at fair value on the date the guarantee was given. Subsequent to initial recognition, the Bank's liabilities under such guarantees are measured at the higher of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The amount determined in accordance with K-IFRS 1109 *'Financial Instruments'* and

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The initial amount recognized, less, when appropriate, cumulative amortization recognized in accordance with K-IFRS 1115 'Revenue from Contracts with Customers'.

***(21) Securities under resale or repurchase agreements***

Securities purchased under agreements to resell are recorded as other loans and receivables and the related interest from these securities is recorded as interest income; securities sold under agreements to repurchase are recorded as other borrowings, and the related interest from these securities is recorded as interest expense.

***(22) Interest income and expense***

Interest income and expense are recognized in profit or loss using the effective interest method. The effective interest method measures the amortized costs of financial instruments and allocates the interest income or expense during the related period.

Upon the calculation of the effective interest rate, the Bank estimates future cash flows by taking into consideration all contractual terms of the financial instrument, but not future credit loss. The calculation also reflects any fees or points paid or received, transaction costs and any related premiums or discounts. In the case that the cash flow and expected duration of a financial instrument cannot be estimated reliably, the effective interest rate is calculated by the contractual cash flow during the contract period.

Once an impairment loss has been recognized on a financial asset or a group of similar assets, subsequent interest income is recognized on the interest rate that was used to discount future cash flow for measuring the impairment loss.

***(23) Fees and commission income***

Fees and commission income and expense are classified as follows according to related regulations:

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Fees and commission from financial instruments***

Fees and commission income and expense that are integral to the effective interest rate on a financial asset or liability are included in the measurement of the effective interest rate. It includes those related to evaluation of the borrowers' financial status, guarantee, collateral, other agreements and related evaluation as well as business transaction, rewards for activities, such as document preparation and recording and setup fees incurred during issuance of financial liabilities. However, when financial instruments are classified as financial instruments at fair value through profit or loss, fees and commission are recognized as revenue upon initial recognition.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Fees and commission from services***

Fees and commission income charged in exchange for services to be performed during a certain period of time such as asset management fees, consignment fees and assurance service fees are recognized as the related services are performed. When a loan commitment is not expected to result in the draw-down of a loan and K-IFRS 1039 *'Financial Instrument: Recognition and Measurement'* is not applied for the commitment, the related loan commitment fees are recognized as revenue proportionally to time over the commitment period.

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**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Fees and commission from significant transaction***

Fees and commission from significant transactions, such as trading stocks and other securities, negotiation and mediation activities for third parties, for instance business transfer and takeover, are recognized when transactions are completed.

***(24) Dividend income***

Dividend income is recognized upon the establishment of the Bank's right to receive the payment.

***(25) Income tax expense***

Income tax expense comprises current and deferred income tax. Current income tax and deferred income tax are recognized in profit or loss except to the extent that the tax arises from a transaction or event, which is recognized in other comprehensive income or directly in equity, or a business combination.

The Bank recognizes deferred income tax liabilities for all taxable temporary differences associated with investments in subsidiaries, associates, except to the extent that the Bank can control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. The Bank recognizes deferred income tax assets for all deductible temporary differences arising from investments in associates, to the extent that it is probable that the temporary difference will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilized.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the reporting period when the assets are realized, or the liabilities settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

The measurement of deferred income tax assets and liabilities reflects the income tax effects that would follow from the manner in which the Bank expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

The carrying amount of a deferred income tax asset is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred income tax asset to be utilized.

Deferred income tax assets and liabilities are off-set only if the Bank has a legally enforceable right to off-set the related current income tax assets and liabilities, and the assets and liabilities relate to income tax levied by the same tax authority and are intended to be settled on a net basis.

***(26) Accounting for trust accounts***

The Bank, for financial reporting, differentiates trust assets from identifiable assets according to the *Financial Investment Services and Capital Markets Act*. Furthermore, the Bank receives trust fees from the application, management and disposal of trust assets, and appropriates such amounts for fees from trust accounts.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**3. <u>Significant Accounting Policies, Continued</u>**

Meanwhile, in the case the fee from an unspecified principal or interests guaranteed money in trust does not meet the principal or interest amount, even after appropriating deficit with trust fees and special reserve, the Bank fills in the remaining deficit in the trust account and appropriates such amounts for losses on trust accounts.

***(27) Regulatory reserve for credit losses***

When the total sum of allowance for possible credit losses is lower than the amount prescribed in Article 29(1) of the *Regulations on Supervision of Banking Business*, the Bank records the difference as regulatory reserve for credit losses at the end of each reporting period.

In the case that the existing regulatory reserve for credit losses exceeds the amount needed to be set aside at the reporting date, the surplus may be reversed. Furthermore, in the case that undisposed deficit exists, regulatory reserve for credit losses is saved from the time the undisposed deficit is disposed.

***(28) Earnings per share***

The Bank represents its diluted and basic earnings per common share in the separate statement of comprehensive income. Basic earnings per share (EPS) is calculated by dividing net profit attributable to shareholders of the Bank by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share is calculated by adjusting net profit attributable to common shareholders of the Bank, considering dilution effects from all potential common shares, and the weighted average number of common shares outstanding.

***(29) Corrections of errors***

Prior period errors shall be corrected by retrospective restatement in the first set of financial statements authorised for issue after their discovery except to the extent that it is impracticable to determine either the period-specific effects or the cumulative effect of the error.

**4. <u>Cash and Due from Banks</u>** 

(1) Cash and due from banks as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Cash | W | 67357 | 65738 |
|  Due from banks in Korean won: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Due from Bank of Korea |  | 1236493 | 1972258 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other due from banks in Korean won |  | 316521 | 45715 |
|  |  | 1553014 | 2017973 |
|  Due from banks in foreign currencies / off-shores |  | 11375150 | 6576097 |
|  | W | 12995521 | 8659808 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**4. <u>Cash and Due from Banks, Continued</u>**

(2) Restricted due from banks as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  Reserve deposit | W | 2664190 |  | 2302201 |
|  Deposit of monetary stabilization account |  |  |  | 150000 |
|  Others |  | 380971 |  | 308676 |
|  | W | 3045161 |  | 2760877 |

---

**5. <u>Securities Measured at FVTPL</u>** 

(1) Details of securities in financial assets at fair value through profit or loss as of December 31, 2024 and
2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Face value** | **Face value** | **Acquisition cost** | **Fair value<br>(Carrying amounts)** |
|  Securities denominated in Korean won: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks | W |  | 2445393 | 2383651 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity investments |  |  | 1193938 | 1345253 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Beneficiary certificates |  |  | 9982204 | 10697146 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and public bonds |  | 2588113 | 2562353 | 2804662 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial bonds |  | 230000 | 230311 | 230200 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 90470 | 90465 | 90721 |
|  |  | 2908583 | 16504664 | 17551633 |
|  Securities denominated in foreign currencies/off-shores: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks |  |  | 27420 | 30688 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity investments |  |  | 154888 | 217416 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Beneficiary certificates |  |  | 479469 | 551952 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt securities |  | 67847 | 64977 | 67111 |
|  |  | 67847 | 726754 | 867167 |
|  | W | 2976430 | 17231418 | 18418800 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Face value** | **Face value** | **Acquisition cost** | **Fair value<br>(Carrying amounts)** |
|  Securities denominated in Korean won: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks | W |  | 2151564 | 2044046 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity investments |  |  | 905853 | 1002008 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Beneficiary certificates |  |  | 9411162 | 9887428 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and public bonds |  | 1686000 | 1637507 | 1784605 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial bonds |  | 600000 | 597206 | 601369 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 50470 | 50234 | 50372 |
|  |  | 2336470 | 14753526 | 15369828 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**5. <u>Securities Measured at FVTPL, Continued</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Face value** | **Face value** | **Acquisition cost** | **Fair value<br>(Carrying amounts)** |
|  Securities denominated in foreign currencies/off-shores: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks | W |  | 27398 | 26918 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity investments |  |  | 104369 | 157892 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Beneficiary certificates |  |  | 477542 | 489767 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt securities |  | 14183 | 13876 | 14151 |
|  |  | 14183 | 623185 | 688728 |
|  | W | 2350653 | 15376711 | 16058556 |

---

(2) Equity securities with disposal restrictions in financial assets at fair value through profit or loss as of
December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| <br>**Company** | **Number of<br>shares** | **Carrying<br>amount** | **Carrying<br>amount** | **Restricted period** |
|  TnJ Co., Ltd. | 167989 | W | 1862 | Undecided |
|  National Happiness Fund | 34066 |  |  | Undecided |
|  SEMITECH Co., Ltd. | 33187 |  | 368 | Undecided |
|  Hongin Chemical Co., Ltd. | 5060 |  |  | Undecided |
|  ROKIT HEALTHCARE Inc. | 288459 |  | 3657 | For one month from the listing date |
|  | 528761 | W | 5887 |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| <br>**Company** | **Number of<br>shares** | **Number of<br>shares** | **Carrying<br>amount** | **Carrying<br>amount** | **Restricted period** |
|  National Happiness Fund |  | 34066 | W | 14884 | Undecided |
|  SEMITECH Co., Ltd. |  | 33187 |  | 368 | Undecided |
|  Hongin Chemical Co., Ltd. |  | 5060 |  |  | Undecided |
|  |  | 72313 | W | 15252 |  |

---

**6. <u>Securities Measured at FVOCI</u>** 

(1) Details of securities measured at FVOCI as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Face value** | **Face value** | **Acquisition cost** | **Fair value<br>(Carrying amounts)** |
|  Securities denominated in Korean won: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks and equity investments | W |  | 13456956 | 13841932 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and public bonds |  | 615000 | 607017 | 611775 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial bonds |  | 1810000 | 1815420 | 1820344 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**6. <u>Securities Measured at FVOCI, Continued</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Face value** | **Face value** | **Acquisition cost** | **Fair value<br>(Carrying amounts)** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds | W | 2326029 | 2325538 | 2265042 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 576000 | 576000 | 1504996 |
|  |  | 5327029 | 18780931 | 20044089 |
|  Securities denominated in foreign currencies/off-shores: | Securities denominated in foreign currencies/off-shores: | Securities denominated in foreign currencies/off-shores: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity securities |  |  | 145 | 1214 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt securities |  | 13064373 | 13167685 | 12674481 |
|  |  | 13064373 | 13167830 | 12675695 |
|  Loaned securities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt securities |  | 40000 | 39965 | 40409 |
|  | W | 18431402 | 31988726 | 32760193 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Face value** | **Face value** | **Acquisition cost** | **Fair value<br>(Carrying amounts)** |
|  Securities denominated in Korean won: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stocks and equity investments | W |  | 11277639 | 11709407 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and public bonds |  | 1575000 | 1561815 | 1558377 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial bonds |  | 1380000 | 1372473 | 1381371 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds |  | 4670160 | 4667812 | 4558013 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 1500680 | 1500680 | 3933681 |
|  |  | 9125840 | 20380419 | 23140849 |
|  Securities denominated in foreign currencies/off-shores: | Securities denominated in foreign currencies/off-shores: | Securities denominated in foreign currencies/off-shores: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity securities |  |  | 498 | 1128 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt securities |  | 11186342 | 11297509 | 10706746 |
|  |  | 11186342 | 11298007 | 10707874 |
|  Loaned securities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt securities |  | 40000 | 39483 | 39341 |
|  | W | 20352182 | 31717909 | 33888064 |

---

Equity instruments that are acquired due to debt-to-equity swap, investment in kind and investment in ventures and small and medium-sized enterprises are designated as measured at FVOCI. The realized pre-tax income and loss on disposal of equity securities for the years ended December 31, 2024 and 2023 are the amount of W1,234,598 million of gain and W1,076,647 million of gain, respectively, which is directly recognized in retained earnings.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**6. <u>Securities Measured at FVOCI, Continued</u>**

(2) Changes in securities measured at FVOCI for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Beginning balance | W | 33888064 | 37684919 |
|  Acquisition |  | 9844523 | 11068483 |
|  Disposal |  | (9430950) | (14296449) |
|  Change due to amortization |  | 23424 | 22292 |
|  Change in fair value |  | (1399248) | (774816) |
|  Reclassification |  | (1696500) |  |
|  Foreign exchange differences |  | 1489314 | 149606 |
|  Others (\*) |  | 41566 | 34029 |
|  Ending balance | W | 32760193 | 33888064 |

---

---

| | |
|:---|:---|
| (\*) | For the year ended December 31, 2024, others represent the increase in securities measured at FVOCI including the shares of BLUEMTEC Co., Ltd., Inhwa Precision Co., Ltd., KODACO Co., Ltd. and others acquired through exercise of conversion rights of the convertible bonds, the shares of DPECO Co., Ltd. and others acquired in accordance with the rehabilitation plan under the Debtor Rehabilitation and Bankruptcy Act, the shares of Aero Space Technology Of Korea Inc. and others acquired in accordance with the changes in creditor rights as resolved by the Financial Creditors' Council and others. For the year ended December 31, 2023, others represent the increase in securities measured at FVOCI including the shares of ALT Co., Ltd., T'way Air Co., Ltd. and others acquired through exercise of conversion rights of the convertible bonds and the shares of Dae Young Metal Co., Ltd., CHEW YOUNG ROO CO., LTD. and others acquired in accordance with the rehabilitation plan under the Debtor Rehabilitation and Bankruptcy Act.  |

---

(3) Equity securities with disposal restrictions in securities measured at FVOCI as of December 31, 2024 and
2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| <br>**Company** | **Number of<br>shares** | **Carrying<br>amount** | **Carrying<br>amount** | **Restricted period** |
|  UAMCO., Ltd. | 113050 | W | 208996 | Undecided |
|  High Gain Antenna Co., Ltd. | 18138 |  | 448 | Undecided |
|  Aero Space Technology Of Korea Inc. | 27912000 |  | 14068 | Until April 8, 2025 |
|  KODACO Co., Ltd. | 2183376 |  | 2 | Until March 26, 2025 |
|  ISTE Co.,Ltd. | 761904 |  | 6248 | For one month from the listing date |
|  FineOne Co., Ltd. | 548245 |  | 3255 | For one to three month from the listing date |
|  3billion Inc. | 234330 |  | 8768 | For two month from the listing date |
|  3ALogics. Inc. | 889184 |  | 8718 | For one to two month from the listing date |
|  Onconic Therapeutics Inc. | 702850 |  | 9999 | For one month from the listing date |
|  Knowmerce Corp. | 335940 |  | 7830 | For two to three month from the listing date |
|  | 33699017 | W | 268332 |  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**6. <u>Securities Measured at FVOCI, Continued</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| <br>**Company** | **Number of<br>shares** | **Carrying<br>amount** | **Carrying<br>amount** | **Restricted period** |
|  UAMCO., Ltd. | 113050 | W | 196670 | Undecided |
|  High Gain Antenna Co., Ltd. | 18138 |  | 372 | Undecided |
|  Kumho Tire Co., Inc. | 21339320 |  | 115019 | Until July 6, 2024 (\*) |
|  | 21470508 | W | 312061 |  |

---

---

| | |
|:---|:---|
| (\*) | From July 6, 2021, 50% of the shares may be sold every year  |

---

(4) Changes in the loss allowance in relation to securities measured at FVOCI for the years ended December 31,
2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **Lifetime expected credit loss** | **Lifetime expected credit loss** | **Lifetime expected credit loss** | **Lifetime expected credit loss** | **Lifetime expected credit loss** |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**Impaired** | **Credit-**<br>**impaired** | **Total** |
|  Beginning balance | W | 16186 | 1173 | 73063 | 90422 |
|  Transfer to 12-month expected credit loss |  |  |  |  |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired debt securities |  | (302) | 302 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired debt securities |  | (75) | 75 |  |  |
|  Provision for (reversal of) loss allowance |  | 2275 | 219 | 143 | 2637 |
|  Disposal |  | (800) |  |  | (800) |
|  Foreign currency translation, etc. |  | 1058 | 30 | 2266 | 3354 |
|  Ending balance | W | 18342 | 1799 | 75472 | 95613 |
|  | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **Lifetime expected credit loss** | **Lifetime expected credit loss** | **Lifetime expected credit loss** | **Lifetime expected credit loss** | **Lifetime expected credit loss** |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**Impaired** | **Credit-**<br>**impaired** | **Total** |
|  Beginning balance | W | 11041 | 2398 | 72740 | 86179 |
|  Transfer to 12-month expected credit loss |  | 187 | (187) |  |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired debt securities |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired debt securities |  |  |  |  |  |
|  Provision for (reversal of) loss allowance |  | 4534 | (219) | (48) | 4267 |
|  Disposal |  | (283) |  |  | (283) |
|  Foreign currency translation, etc. |  | 707 | (819) | 371 | 259 |
|  Ending balance | W | 16186 | 1173 | 73063 | 90422 |

---

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**7. <u>Securities Measured at Amortized Cost</u>** 

(1) Securities measured at amortized cost as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Amortized cost** | **Amortized cost** | **Fair value** |
|  Securities denominated in Korean won: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and public bonds | W | 3492235 | 3492235 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial bonds |  | 2015083 | 2014617 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds |  | 2849742 | 2840493 |
|  |  | 8357060 | 8347345 |
|  Securities denominated in foreign currencies: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds |  | 588960 | 588960 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less: loss allowance |  | (9715) |  |
|  | W | 8936305 | 8936305 |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Amortized cost** | **Amortized cost** | **Fair value** |
|  Securities denominated in Korean won: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and public bonds | W | 3841102 | 3841102 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial bonds |  | 2456764 | 2456431 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds |  | 2141858 | 2132972 |
|  |  | 8439724 | 8430505 |
|  Securities denominated in foreign currencies: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds |  | 152683 | 152683 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less: loss allowance |  | (9219) |  |
|  | W | 8583188 | 8583188 |

---

(2) Changes in securities measured at amortized cost for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Beginning balance | W | 8583188 | 6355884 |
|  Acquisition |  | 5020325 | 5217386 |
|  Redemption |  | (4708420) | (3020000) |
|  Change due to amortization |  | 23210 | 38929 |
|  Impairment loss |  | (496) | (9011) |
|  Foreign exchange differences, etc. |  | 18498 |  |
|  Ending balance | W | 8936305 | 8583188 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**8. <u>Loans Measured at FVTPL</u>** 

(1) Loans measured at FVTPL as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  | **Amortized cost** | **Amortized cost** | **Fair value**<br>**(Carrying amounts)** | **Amortized cost** | **Fair value**<br>**(Carrying amounts)** |
|  Loans in Korean won: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Privately placed corporate bonds | W | 378250 | 419773 | 422724 | 488432 |
|  Loans in foreign currencies: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Privately placed corporate bonds |  | 3400 |  | 2804 |  |
|  | W | 381650 | 419773 | 425528 | 488432 |

---

(2) Losses related to loans measured at FVTPL for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Transaction gains (losses) on loans measured at FVTPL |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transaction gains | W | 4126 | 8254 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transaction losses |  | (6796) | (5332) |
|  |  | (2670) | 2922 |
|  Valuation losses on loans measured at FVTPL |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation gains |  | 2534 | 7381 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation losses |  | (26639) | (16294) |
|  |  | (24105) | (8913) |
|  | W | (26775) | (5991) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**9. <u>Loans Measured at Amortized Cost</u>** 

(1) Loans measured at amortized cost and loss allowance for loan as of December 31, 2024 and 2023 are as
follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  | **Amortized cost** | **Amortized cost** | **Fair value** | **Amortized cost** | **Fair value** |
|  Loans in Korean won: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans for working capital | W | 68851877 | 68093728 | 69353773 | 68310908 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans for facility development |  | 62063432 | 61108673 | 61149089 | 59856968 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans for households |  | 117607 | 116709 | 143534 | 142911 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inter-bank loans |  | 2877321 | 2703919 | 2971744 | 2807208 |
|  |  | 133910237 | 132023029 | 133618140 | 131117995 |
|  Loans in foreign currencies: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans |  | 35155384 | 35092441 | 29820779 | 29740998 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inter-bank loans |  | 7052491 | 7029441 | 3879644 | 3865256 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Off-shore loans |  | 23728052 | 23543740 | 20816849 | 20691653 |
|  |  | 65935927 | 65665622 | 54517272 | 54297907 |
|  Other loans: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bills bought in foreign currency |  | 2755722 | 2723534 | 2033111 | 1995544 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Advances for customers on acceptances and guarantees |  | 16592 | 2278 | 24593 | 11463 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Privately placed corporate bonds |  | 1758612 | 1745315 | 2307802 | 2231504 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 8005365 | 7827441 | 10566404 | 10403677 |
|  |  | 12536291 | 12298568 | 14931910 | 14642188 |
|  |  | 212382455 | 209987219 | 203067322 | 200058090 |
|  Less: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss allowance for loan |  | (2926042) |  | (3099978) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Present value discount |  | (9728) |  | (11054) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred loan origination costs and fees |  | 34668 |  | 25490 |  |
|  | W | 209481353 |  | 199981780 |  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**9. <u>Loans Measured at Amortized Cost, Continued</u>**

(2) Changes in loss allowance for loan for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | | | **Lifetime expected credit losses** | **Lifetime expected credit losses** | |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |<br>**Total** |
|  Beginning balance | W | 587840 | 1423097 | 1089041 | 3099978 |
|  Transfer to 12-month expected credit loss |  | 35129 | (35005) | (124) |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired loans |  | (176556) | 190847 | (14291) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired loans |  | (54321) | (85329) | 139650 |  |
|  Provision for (reversal of) loss allowance |  | 326386 | (209005) | (26544) | 90837 |
|  Write-offs |  |  |  | (24526) | (24526) |
|  Recovery |  |  |  | 52255 | 52255 |
|  Sale |  |  |  | (232565) | (232565) |
|  Debt-to-equity swap |  |  |  | (48175) | (48175) |
|  Foreign currency translation |  | 22358 | 6134 | 18557 | 47049 |
|  Other |  | (6917) | (25713) | (26181) | (58811) |
|  Ending balance | W | 733919 | 1265026 | 927097 | 2926042 |
|  | **2023** | **2023** | **2023** | **2023** | **2023** |
|  |  |  | **Lifetime expected credit losses** | **Lifetime expected credit losses** |  |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** | **Total** |
|  Beginning balance | W | 289254 | 2340836 | 1367141 | 3997231 |
|  Transfer to 12-month expected credit loss |  | 62758 | (49164) | (13594) |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired loans |  | (90108) | 106404 | (16296) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired loans |  | (70171) | (287708) | 357879 |  |
|  Provision for (reversal of) loss allowance |  | 388223 | (704243) | (82991) | (399011) |
|  Write-offs |  |  |  | (203807) | (203807) |
|  Recovery |  |  |  | 40194 | 40194 |
|  Sale |  |  |  | (188127) | (188127) |
|  Debt-to-equity swap |  |  |  | (134919) | (134919) |
|  Foreign currency translation |  | 7497 | 12366 | 117 | 19980 |
|  Other |  | 387 | 4606 | (36556) | (31563) |
|  Ending balance | W | 587840 | 1423097 | 1089041 | 3099978 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**9. <u>Loans Measured at Amortized Cost, Continued</u>**

(3) Gains (losses) related to loans measured at amortized cost for the years ended December 31, 2024 and 2023
are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Reversal of (provision for) allowance for loan losses | W | (90837) | 399011 |
|  Gains (losses) on disposal of loan |  | (26257) | 11341 |
|  | W | (117094) | 410352 |

---

(4) Changes in net deferred loan origination costs and fees for the years ended December 31, 2024 and 2023 are
as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Beginning balance | W | 25490 | 21224 |
|  New deferrals |  | 24019 | 19969 |
|  Amortization |  | (14841) | (15703) |
|  Ending balance | W | 34668 | 25490 |

---

**10. <u>Derivative Financial Instruments</u>** 

The Bank's derivative financial instruments consist of trading derivatives and hedging derivatives, depending on the nature of each transaction. The Bank enters into hedging derivative transactions mainly for the purpose of hedging risk related to changes in fair values of the underlying assets and liabilities and future cash flows.

The Bank enters into trading derivative transactions such as futures, forwards, swaps and options for arbitrage transactions by speculating on the future value of the underlying asset. Derivatives held-for trading transactions include contracts with the Bank's clients and its liquidation position.

For the purpose of hedging the exposure to the variability of fair values and cash flows of funds in Korean won by changes in interest rate, the Bank mainly uses interest swaps or currency swaps. The main counterparties are foreign financial institutions and local banks. In addition, to hedge the exposure to the variability of fair values of bonds in foreign currencies by changes in interest rate or foreign exchange rate, the Bank mainly uses interest swaps or currency swaps.

The Bank applies net investment hedge accounting by designating non-derivative financial instruments as hedging instruments and any gain or loss on the hedging instruments relating to the effective portion of the hedge is recognised in other comprehensive income and accumulated in the foreign currency translation reserve.

Gains and losses on the hedging instrument accumulated in the foreign currency translation reserve are reclassified to profit or loss on the disposal or partial disposal of the foreign operation.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**10. <u>Derivative Financial Instruments, Continued</u>**

(1) The notional amounts outstanding for derivative contracts and the carrying amounts of the derivative financial
instruments as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Notional amounts** | **Notional amounts** | **Notional amounts** | **Carrying amounts** | **Carrying amounts** |
|  | **Buy** | **Buy** | **Sell** | **Asset** | **Liability** |
|  Trading purpose derivative financial instruments: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures | W | 140000 | 249316 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 70000 | 1050000 | 694 | 101248 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 388226698 | 388229673 | 1167657 | 1815342 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 6107544 | 17571540 | 279721 | 543144 |
|  |  | 394544242 | 407100529 | 1448072 | 2459734 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 64871269 | 46445711 | 4032920 | 1953791 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 82977711 | 99618376 | 8147283 | 9318293 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 262474 | 250213 | 8736 | 3184 |
|  |  | 148111454 | 146314300 | 12188939 | 11275268 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 3084 | 48 | 259 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Allowance and other adjustments |  |  |  | (12825) | (1804) |
|  |  | 542658780 | 553414877 | 13624445 | 13733198 |
|  Hedging purpose derivative financial instruments: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate (\*) |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 48180348 | 48180348 | 130264 | 235972 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 11609881 | 12259237 | 160577 | 907743 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Allowance and other adjustments |  |  |  | (35) | (2974) |
|  |  | 59790229 | 60439585 | 290806 | 1140741 |
|  | W | 602449009 | 613854462 | 13915251 | 14873939 |

---

(\*) The expected maximum period for which derivative contracts, applied the cash flow hedge accounting, are exposed to risk of cash flow fluctuation is until April 29, 2025.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**10. <u>Derivative Financial Instruments, Continued</u>**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Notional amounts** | **Notional amounts** | **Notional amounts** | **Carrying amounts** | **Carrying amounts** |
|  | **Buy** | **Buy** | **Sell** | **Asset** | **Liability** |
|  Trading purpose derivative financial instruments: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Futures | W | 10000 | 178898 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 150000 | 960000 | 19805 | 61903 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 328237476 | 328249544 | 1175713 | 1590340 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 7060912 | 14242205 | 363225 | 477698 |
|  |  | 335458388 | 343630647 | 1558743 | 2129941 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Forwards |  | 49981210 | 34750324 | 1138767 | 681269 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 56661776 | 71544517 | 4134336 | 4148686 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 283101 | 284177 | 755 | 2437 |
|  |  | 106926087 | 106579018 | 5273858 | 4832392 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options |  | 3041 | 334536 | 278 | 128 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Allowance and other adjustments |  |  |  | (11855) | (1075) |
|  |  | 442387516 | 450544201 | 6821024 | 6961386 |
|  Hedging purpose derivative financial instruments: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate (\*) |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 37996299 | 37996299 | 88620 | 337955 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 10411160 | 10225034 | 473876 | 358865 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Allowance and other adjustments |  |  |  | (195) | (3305) |
|  |  | 48407459 | 48221333 | 562301 | 693515 |
|  | W | 490794975 | 498765534 | 7383325 | 7654901 |

---

(\*) The expected maximum period for which derivative contracts, applied the cash flow hedge accounting, are exposed to risk of cash flow fluctuation is until April 29, 2025.

(2) The notional amounts outstanding for the hedging instruments by period as of December 31, 2024 and 2023
are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Within 1<br>month** | **Within 1<br>month** | **1~3**<br>**months** | **3~12**<br>**months** | **1~5**<br>**years** | **Over 5**<br>**years** | **Total** |
|  Interest rate: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notional amounts outstanding | W | 194040 | 4804351 | 9943343 | 24808058 | 8430556 | 48180348 |
|  Currency: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notional amounts outstanding | W | 532518 | 600953 | 1277080 | 7771329 | 1428001 | 11609881 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**10. <u>Derivative Financial Instruments, Continued</u>**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Within 1<br>month** | **Within 1<br>month** | **1~3**<br>**months** | **3~12**<br>**months** | **1~5**<br>**years** | **Over 5**<br>**years** | **Total** |
|  Interest rate: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notional amounts outstanding | W | 894844 | 1337050 | 4089937 | 24151788 | 7522680 | 37996299 |
|  Currency: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notional amounts outstanding | W | 701180 | 622774 | 1970389 | 5721728 | 1395089 | 10411160 |

---

(3) Details of the balances of the hedging instruments by risk type as of December 31, 2024 and 2023 are as
follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Notional amounts** | **Notional amounts** | **Notional amounts** | **Balances** | **Balances** | **Changes**<br>**in fair value<br>for 2024** |
|  | **Buy** | **Buy** | **Sell** | **Assets** | **Liabilities** | **Changes**<br>**in fair value<br>for 2024** |
|  Cash flow hedge accounting: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate risk: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps | W | 58800 | 58800 |  |  | (2044) |
|  Fair value hedge accounting: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate risk: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 48121548 | 48121548 | 130264 | 235972 | 256255 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency risk |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 11609881 | 12259237 | 160577 | 907743 | (825515) |
|  |  | 59731429 | 60380785 | 290841 | 1143715 | (569260) |
|  | W | 59790229 | 60439585 | 290841 | 1143715 | (571304) |
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Notional amounts** | **Notional amounts** | **Notional amounts** | **Balances** | **Balances** | **Changes**<br>**in fair value<br>for 2023** |
|  | **Buy** | **Buy** | **Sell** | **Assets** | **Liabilities** | **Changes**<br>**in fair value<br>for 2023** |
|  Cash flow hedge accounting: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate risk: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps | W | 90258 | 90258 |  |  | (3222) |
|  Fair value hedge accounting: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate risk: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 37906041 | 37906041 | 88620 | 337955 | 684976 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency risk |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Swaps |  | 10411160 | 10225034 | 473876 | 358865 | 428419 |
|  |  | 48317201 | 48131075 | 562496 | 696820 | 1113395 |
|  | W | 48407459 | 48221333 | 562496 | 696820 | 1110173 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**10. <u>Derivative Financial Instruments, Continued</u>**

(4) Details of the balances of the hedged items by risk type as of December 31, 2024 and 2023 are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Carrying amounts** | **Carrying amounts** | **Carrying amounts** | **Change in value of**<br>**the hedged item** | **Change in value of**<br>**the hedged item** | **Changes**<br>**in fair value<br>for 2024** | **Cash flow<br>hedge<br>reserve** |
|  | **Assets** | **Assets** | **Liabilities** | **Assets** | **Liabilities** | **Changes**<br>**in fair value<br>for 2024** | **Cash flow<br>hedge<br>reserve** |
|  Cash flow hedge accounting: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate risk: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt debentures | W |  | 58800 |  |  |  | 1045 |
|  Fair value hedge accounting: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate risk: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 6638016 |  | 8661 |  | (6819) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt debentures |  |  | 40711955 |  | (868944) | (265708) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities (Deposits, etc.) |  |  | 122084 |  | (24359) | 3247 |  |
|  |  | 6638016 | 40834039 | 8661 | (893303) | (269280) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency risk: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt debentures |  |  | 11376831 |  | 527750 | 828917 |  |
|  |  | 6638016 | 52210870 | 8661 | (365553) | 559637 |  |
|  | W | 6638016 | 52269670 | 8661 | (365553) | 559637 | 1045 |
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Carrying amounts** | **Carrying amounts** | **Carrying amounts** | **Change in value of**<br>**the hedged item** | **Change in value of**<br>**the hedged item** | **Changes**<br>**in fair value<br>for 2023** | **Cash flow<br>hedge<br>reserve** |
|  | **Assets** | **Assets** | **Liabilities** | **Assets** | **Liabilities** | **Changes**<br>**in fair value<br>for 2023** | **Cash flow<br>hedge<br>reserve** |
|  Cash flow hedge accounting: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate risk: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt debentures | W |  | 90258 |  |  |  | 4034 |
|  Fair value hedge accounting: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate risk: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 5423921 |  | 129096 |  | 89803 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt debentures |  |  | 33375068 |  | (1094649) | (769319) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other liabilities (Deposits, etc.) |  |  | 110422 |  | (18518) | (885) |  |
|  |  | 5423921 | 33485490 | 129096 | (1113167) | (680401) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency risk: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt debentures |  |  | 10206197 |  | 300053 | (425112) |  |
|  |  | 5423921 | 43691687 | 129096 | (813114) | (1105513) |  |
|  | W | 5423921 | 43781945 | 129096 | (813114) | (1105513) | 4034 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**10. <u>Derivative Financial Instruments, Continued</u>**

(5) Details of hedge ineffectiveness recognized in profit or loss from derivatives for the years ended
December 31, 2024 and 2023 is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Interest rate risk | W | (13025) | 4575 |
|  Currency risk |  | 3402 | 3307 |
|  | W | (9623) | 7882 |

---

(6) The summary of the amounts that have affected the statement of comprehensive income as a result of applying
cash flow hedge accounting for the years ended December 31, 2024 and 2023 is as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** |
|  | **Change in the value of the<br>hedging instrument<br>recognized in other<br>comprehensive income** | **Change in the value of the<br>hedging instrument<br>recognized in other<br>comprehensive income** | **Hedge ineffectiveness<br>recognized in profit or<br>loss (\*)** | **Amount reclassified from<br>other comprehensive<br>income to profit or<br>loss (\*)** |
|  Interest rate risk | W | (2152) | 108 | (837) |

---

(\*) Recognized in gains or losses related to hedging purpose derivatives.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** |
|  | **Change in the value of the<br>hedging instrument<br>recognized in other<br>comprehensive income** | **Change in the value of the<br>hedging instrument<br>recognized in other<br>comprehensive income** | **Hedge ineffectiveness<br>recognized in profit or<br>loss (\*)** | **Amount reclassified from<br>other comprehensive<br>income to profit or<br>loss (\*)** |
|  Interest rate risk | W | (3207) | (16) |  |

---

(\*) Recognized in gains or losses related to hedging purpose derivatives.

(7) Details of net investments in foreign operations for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** |
|  | **Changes in fair value** | **Changes in fair value** | **Other comprehensive income for hedges of<br>net investments in foreign operations** |
|  Currency (foreign exchange risk) | W | 166721 | (283996) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** |
|  | **Changes in fair value** | **Changes in fair value** | **Other comprehensive income for hedges of<br>net investments in foreign operations** |
|  Currency (foreign exchange risk) | W | 20402 | (117276) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**10. <u>Derivative Financial Instruments, Continued</u>**

(8) Details of hedging instruments in hedge of net investments in foreign operations as of December 31, 2024
and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Carrying amount** | **Carrying amount** | **Changes in fair<br>value for 2024** | **Change in the value of<br>the hedging instrument<br>recognized in other<br>comprehensive income<br>for 2024** | **Hedge<br>ineffectiveness<br>recognized in<br>profit or loss for<br>2024** |
|  Debentures in foreign currencies | W | 1324680 | (166721) | (166721) |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Carrying amount** | **Carrying amount** | **Changes in fair<br>value for 2023** | **Change in the value of<br>the hedging instrument<br>recognized in other<br>comprehensive income<br>for 2023** | **Hedge<br>ineffectiveness<br>recognized in<br>profit or loss for<br>2023** |
|  Debentures in foreign currencies | W | 1137428 | (20402) | (20402) |  |

---

**11. <u>Investments in Subsidiaries and Associates</u>** 

(1) Investments in subsidiaries and associates as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Subsidiaries: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Asia Ltd. | W | 332907 | 332907 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Bank Europe Ltd.(\*1) |  | 145747 | 126602 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Ireland Ltd. |  | 62389 | 62389 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Bank Uzbekistan Ltd. |  | 47937 | 47937 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banco KDB Do Brazil S.A.(\*2) |  | 52622 | 51275 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; PT KDB Tifa Finance Tbk |  | 85288 | 85288 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Silicon Valley LLC |  | 118615 | 118615 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB OCCASIO II, L.P. |  | 147565 | 138850 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Synergy, L.P. |  | 126592 | 19872 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Investment Co., Ltd. |  | 70000 | 70000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Biz Co., Ltd. |  | 1500 | 1500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Capital Corporation |  | 597290 | 597290 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea BTL Financing 1 |  | 100623 | 115086 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Railroad Financing 1 |  | 67098 | 72907 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Education Financing |  | 30685 | 35744 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Infrastructure Investment Asset Management Co., Ltd. |  | 16843 | 16843 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Consus Value PEF(\*3) |  | 317360 | 177353 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB-IAP OBOR PEF(\*4) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Green Initiative 2nd Private Equity Fund |  | 217577 | 135687 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDBC Co-investment Private Equity Fund |  | 33914 | 26751 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Asia PEF |  | 88066 | 88066 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Small Medium Mezzanine PEF |  | 33350 | 33350 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate Liquidity Assistance Agency Co., Ltd. |  | 1000000 | 1000000 |
|  |  | 3693968 | 3354312 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**11. <u>Investments in Subsidiaries and Associates, Continued</u>**

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Associates**:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Electric Power Co., Ltd. |  | 16921067 | 16921067 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Tourism Organization |  | 337286 | 337286 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Infrastructure Fund II |  | 212074 | 212515 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Ocean Business Corporation |  | 631777 | 631777 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Real Estate Board |  | 58492 | 58492 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hanwha Ocean Co., Ltd. (priorly known as Daewoo Shipbuilding & Marine Engineering Co., Ltd.)(\*5) |  | 2227877 | 1496741 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HMM Co., Ltd.(\*6) |  | 5240667 | 3932440 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; GM Korea Company(\*7) |  | 474733 | 455904 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HANJIN KAL(\*8) |  | 500000 | 500000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korean Air Lines Co., Ltd. |  | 330477 | 330477 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; TAEYOUNG ENGINEERING & CONSTRUCTION |  | 54719 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others(\*9) |  | 2580204 | 2571997 |
|  |  | 29569373 | 27448696 |
|  | W | 33263341 | 30803008 |

---

---

| | |
|:---|:---|
| (\*1) | The Bank recognized reversal of impairment losses amounting to W19,145 million and W1,150 million for the years ended December 31, 2024 and 2023, respectively, due to an increase in value in use resulting from the enhancement of expected cash flows from the shares held by the Bank.  |

---

---

| | |
|:---|:---|
| (\*2) | The Bank recognized reversal of impairment losses amounting to W1,347 million and W11,513 million for the years ended December 31, 2024 and 2023, respectively, due to an increase in value in use resulting from the enhancement of expected cash flows from the shares held by the Bank.  |

---

---

| | |
|:---|:---|
| (\*3) | The Bank recognized a impairment loss amounting to W161,231 million and W93,109 million for the year ended December 31, 2024 and 2023, respectively, due to a decrease in value in use resulting from the deterioration of expected cash flows from the shares held by the Bank.  |

---

(\*4) The decrease in the net asset value due to the decrease in the fair value of assets held prior to the previous year was considered as objective evidence of impairment and an impairment loss was recognized, resulting in a carrying value of "0".

---

| | |
|:---|:---|
| (\*5) | The Bank recognized reversal of impairment losses amounting to W731,136 million and W366,972 million for the years ended December 31, 2024 and 2023, respectively, due to an increase in value in use resulting from the enhancement of expected cash flows from the shares held by the Bank.  |

---

---

| | |
|:---|:---|
| (\*6) | The Bank selected the Pan Ocean-JKL consortium as the preferred bidder on December 18, 2023 for the shares of HMM Co., Ltd. for the year ended December 31, 2023. The shares of HMM Co., Ltd. was classified to the assets held for sale from the investments in associates. However, as negotiations regarding the sale of shares with the Pan Ocean-JKL consortium fell through on February 7, 2024, the shares was retrospectively reclassified the investments in associates for the year ended December 31, 2024. Due to a decrease in the recoverable amount resulting from changes in the fair value of the shares, an impairment loss of W388,273 million was recognized for the year ended December 31, 2024, while an impairment reversal of W460,941 million was recognized in the year ended December 31, 2023 due to an increase in the recoverable amount.  |

---

---

| | |
|:---|:---|
| (\*7) | The Bank recognized a reversal of impairment loss amounting to W18,830 million and W79,450 million for the years ended December 31, 2024 and 2023, respectively, due to the increase in value in use based on the operating cash flow.  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**11. <u>Investments in Subsidiaries and Associates, Continued</u>**

---

| | |
|:---|:---|
| (\*8) | The Bank recognized a reversal of impairment loss amounting to W147,239 million for the year ended December 31, 2023. due to the increase in value in use based on the operating cash flow.  |

---

---

| | |
|:---|:---|
| (\*9) | The Bank recognized impairment losses amounting to W60,067 million for AJU PRIVATE EQUITY FUND NO.2 and 17 other companies for the year ended December 31, 2024. The Bank recognized a reversal of impairment losses amounting to W1,763 million for AJU PRIVATE EQUITY FUND NO.2 and 13 other companies for the year ended December 31, 2023.  |

---

(2) The market value of marketable investments in subsidiaries and associates as of December 31, 2024 and 2023
are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Market value** | **Market value** | **Market value** | **Carrying amounts** | **Carrying amounts** |
|  | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Korea Electric Power Co., Ltd. | W | 4235267 | 3992346 | 16921067 | 16921067 |
|  HMM Co., Ltd. |  | 5248540 | 3939482 | 5240667 | 3932440 |
|  HANJIN KAL |  | 532486 | 514124 | 500000 | 500000 |
|  Korean Air Lines Co., Ltd. |  | 276622 | 292534 | 330477 | 330477 |
|  Hanwha Ocean Co., Ltd. |  | 2231222 | 1499429 | 2227877 | 1496741 |
|  TAEYOUNG ENGINEERING & CONSTRUCTION |  | 82420 |  | 54719 |  |

---

(3) The key financial information of subsidiaries and associates invested and ownership ratios as of
December 31, 2024 and 2023 are as follows:

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Country** | **Fiscal<br>year end** | **Industry** | **Assets** | **Assets** | **Liabilities** | **Equity** | **Operating<br>revenue** | **Net<br>income<br>(loss)** | **Total<br>compre-<br>hensive<br>income<br>(loss)** | **Owner-<br>ship<br>(%)** |
|  Subsidiaries: |  |  |  |  |  |  |  |  |  |  |  |
|  KDB Asia (HK) Ltd. | Hong Kong | December | Finance | W | 4772302 | 3861411 | 910891 | 398397 | 86776 | 198956 | 100.00 |
|  KDB Bank Europe Ltd. | Hungary | December | Finance |  | 1576690 | 1428151 | 148539 | 124478 | 10345 | 7833 | 100.00 |
|  KDB Ireland Ltd. | Ireland | December | Finance |  | 1451315 | 1274047 | 177268 | 104690 | 13336 | 37879 | 100.00 |
|  KDB Bank Uzbekistan Ltd. | Uzbekistan | December | Finance |  | 1119216 | 909683 | 209533 | 107884 | 58442 | 72178 | 86.32 |
|  Banco KDB Do Brazil S.A. | Brazil | December | Finance |  | 768583 | 651551 | 117032 | 112929 | 10355 | (3077) | 100.00 |
|  PT KDB Tifa Finance Tbk | Indonesia | December | Finance |  | 187549 | 76978 | 110571 | 15676 | 5542 | 14484 | 84.65 |
|  KDB Silicon Valley LLC | USA | December | Finance |  | 154757 | 2318 | 152439 | 5950 | 1022 | 21644 | 100.00 |
|  KDB OCCASIO II, L.P. | Cayman<br>Islands | December | Finance |  | 216086 | 19201 | 196885 | 19917 | 18443 | 41624 | 90.00 |
|  KDB Synergy, L.P. | Cayman<br>Islands | December | Finance |  | 158602 | 14632 | 143970 | 6229 | 2079 | 16085 | 100.00 |
|  KDB Capital Corporation | Korea | December | Specialized<br>Credit Finance |  | 10817227 | 9131904 | 1685323 | 887013 | 228977 | 227595 | 99.92 |
|  Korea BTL Financing 1 (\*1) | Korea | Semi-<br>annually | Financial<br>investment |  | 244602 | 168 | 244434 | 14769 | 10165 | 10165 | 41.67 |
|  Korea Railroad Financing 1 (\*1) | Korea | Semi-<br>annually | Financial<br>investment |  | 138295 | 6 | 138289 | 7677 | 5400 | 5400 | 50.00 |
|  Korea Education Financing (\*1) | Korea | Semi-<br>annually | Financial<br>investment |  | 62670 | 9 | 62661 | 3389 | 2676 | 2676 | 50.00 |
|  KDB Infrastructure Investment Asset Management Co., Ltd. | Korea | December | Asset<br>management |  | 81990 | 15033 | 66957 | 43136 | 20295 | 20152 | 84.16 |
|  KDB Investment Co., Ltd. | Korea | December | Finance |  | 95332 | 4281 | 91051 | 9975 | 3797 | 3759 | 100.00 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**11. <u>Investments in Subsidiaries and Associates, Continued</u>**

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Country** | **Fiscal<br>year end** | **Industry** | **Assets** | **Liabilities** | **Equity** | **Operating<br>revenue** | **Net<br>income<br>(loss)** | **Total<br>compre-<br>hensive<br>income<br>(loss)** | **Owner-<br>ship<br>(%)** |
|  KDB Biz Co., Ltd. | Korea | December | Services | 7823 | 4344 | 3479 | 29648 | 415 | (128) | 100.00 |
|  KDB Consus Value PEF | Korea | December | Financial<br>investment | 17763900 | 17705401 | 58499 | 1772177 | 4576 | (621923) | 75.92 |
|  KDB-IAP OBOR PEF (\*2) | Korea | December | Financial<br>investment | 68249 | 77936 | (9687) |  | (1123) | (2251) | 33.52 |
|  KDB Asia PEF (\*2) | Korea | December | Financial<br>investment | 239159 | 198 | 238961 | 1 | 3572 | 30175 | 50.00 |
|  KDB Small Medium Mezzanine PEF | Korea | December | Financial<br>investment | 63454 | 75 | 63379 | 2320 | (23138) | (23138) | 66.67 |
|  Green Initiative 2nd Private Equity Fund (\*2) | Korea | December | Financial<br>investment | 1331309 | 641097 | 690212 | 620498 | (14598) | (14642) | 38.00 |
|  KDBC Co-investment Private Equity Fund | Korea | December | Financial<br>investment | 52964 | 111 | 52853 | 49841 | 38074 | 38074 | 70.00 |
|  Corporate Liquidity Assistance Agency Co., Ltd. | Korea | December | Financial<br>investment | 1082696 |  | 1082696 | 32897 | 14841 | 14841 | 100.00 |
|  Associates: |  |  |  |  |  |  |  |  |  |  |
|  Korea Electric Power Co., Ltd. | Korea | December | Electricity<br>generation | 246807795 | 205444962 | 41362833 | 93398896 | 3491698 | 4070175 | 32.90 |
|  Korea Tourism Organization | Korea | December | Culture and<br>tourism<br>administration | 1186637 | 374191 | 812446 | 883749 | 947 | (3064) | 43.58 |
|  Korea Infrastructure Fund II | Korea | December | Financial<br>investment | 958001 | 118877 | 839124 | 104545 | 97646 | 97646 | 26.67 |
|  Korea Ocean Business Corporation | Korea | December | Finance | 13718841 | 5657223 | 8061618 | 500210 | (437522) | 173900 | 20.80 |
|  Korea Real Estate Board | Korea | December | Appraisal | 314616 | 59868 | 254748 | 240013 | 17147 | 17129 | 30.60 |
|  GM Korea Company (\*3) | Korea | December | Manufacturing | 9904378 | 4593449 | 5310929 | 14337105 | 2198818 | 2084697 | 17.02 |
|  HMM Co., Ltd. | Korea | December | Foreign cargo<br>transportation | 33848562 | 5993018 | 27855544 | 11700224 | 3782169 | 6946998 | 33.73 |
|  HANJIN KAL (\*3) | Korea | December | Holding<br>company | 4207158 | 893997 | 3313161 | 292157 | 496999 | 467614 | 10.58 |
|  Korean Air Lines Co., Ltd. (\*3) | Korea | December | Air passenger<br>transportation | 47012066 | 36048874 | 10963192 | 17870718 | 1381858 | 1279328 | 3.32 |
|  Hanwha Ocean Co., Ltd. (\*3) | Korea | December | Manufacturing | 17843809 | 12980459 | 4863350 | 10776005 | 528119 | 568324 | 19.50 |
|  TAEYOUNG ENGINEERING & CONSTRUCTION (\*4) | Korea | December | Construction | 4323924 | 3796725 | 527199 | 2686174 | 34976 | 31449 | 11.64 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**11. <u>Investments in Subsidiaries and Associates, Continued</u>**

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Country** | **Fiscal<br>year end** | **Industry** | **Assets** | **Assets** | **Liabilities** | **Equity** | **Operating<br>revenue** | **Net<br>income<br>(loss)** | **Total<br>compre-<br>hensive<br>income<br>(loss)** | **Owner-<br>ship<br>(%)** |
|  Subsidiaries: |  |  |  |  |  |  |  |  |  |  |  |
|  KDB Asia (HK) Ltd. | Hong Kong | December | Finance | W | 4011578 | 3299643 | 711935 | 322406 | 62770 | 80327 | 100.00 |
|  KDB Bank Europe Ltd. | Hungary | December | Finance |  | 1379518 | 1238011 | 141507 | 137648 | 8454 | 30487 | 100.00 |
|  KDB Ireland Ltd. | Ireland | December | Finance |  | 1182367 | 1042978 | 139389 | 85944 | 10194 | 15241 | 100.00 |
|  KDB Bank Uzbekistan Ltd. | Uzbekistan | December | Finance |  | 888598 | 751243 | 137355 | 83945 | 47004 | 33272 | 86.32 |
|  Banco KDB Do Brazil S.A. | Brazil | December | Finance |  | 637659 | 517549 | 120110 | 131662 | 14396 | 25061 | 100.00 |
|  PT KDB Tifa Finance Tbk | Indonesia | December | Finance |  | 150511 | 54424 | 96087 | 14843 | 4480 | 7332 | 84.65 |
|  KDB Silicon Valley LLC | USA | December | Finance |  | 132634 | 1839 | 130795 | 8254 | 3574 | 5711 | 100.00 |
|  KDB OCCASIO II, L.P. | Cayman<br>Islands | December | Finance |  | 155351 | 90 | 155261 | 18225 | 15257 | 14228 | 90.00 |
|  KDB Synergy, L.P. | Cayman<br>Islands | December | Finance |  | 21185 | 20 | 21165 | 2809 | 1194 | 1521 | 100.00 |
|  KDB Capital Corporation | Korea | December | Specialized<br>Credit Finance |  | 9776950 | 8227089 | 1549861 | 744953 | 207287 | 205033 | 99.92 |
|  Korea BTL Financing 1 (\*1) | Korea | Semi-<br>annually | Financial<br>investment |  | 279733 | 192 | 279541 | 15888 | (4753) | (4753) | 41.67 |
|  Korea Railroad Financing 1 (\*1) | Korea | Semi-<br>annually | Financial<br>investment |  | 150436 | 11 | 150425 | 9840 | 9446 | 9446 | 50.00 |
|  Korea Education Financing (\*1) | Korea | Semi-<br>annually | Financial<br>investment |  | 72755 | 8 | 72747 | 3390 | (10097) | (10097) | 50.00 |
|  KDB Infrastructure Investment Asset Management Co., Ltd. | Korea | December | Asset<br>management |  | 73868 | 10563 | 63305 | 40431 | 19402 | 19202 | 84.16 |
|  KDB Investment Co., Ltd. | Korea | December | Finance |  | 131258 | 1366 | 129892 | 10104 | 3118 | 3153 | 100.00 |
|  KDB Biz Co., Ltd. | Korea | December | Services |  | 7200 | 3594 | 3606 | 27528 | 678 | (55) | 100.00 |
|  KDB Consus Value PEF | Korea | December | Financial<br>investment |  | 17496596 | 17116238 | 380358 | 1491269 | 11790 | 1614265 | 70.56 |
|  KDB-IAP OBOR PEF (\*2) | Korea | December | Financial<br>investment |  | 59864 | 67299 | (7435) |  | (6285) | (6229) | 33.52 |
|  KDB Asia PEF (\*2) | Korea | December | Financial<br>investment |  | 217186 | 182 | 217004 | 1 | (241) | 14879 | 50.00 |
|  KDB Small Medium Mezzanine PEF | Korea | December | Financial<br>investment |  | 86610 | 94 | 86516 | 4203 | 972 | 972 | 66.67 |
|  Green Initiative 2nd Private Equity Fund (\*2) | Korea | December | Financial<br>investment |  | 822461 | 378517 | 443944 | 18478 | (7613) | (8251) | 38.00 |
|  KDBC Co-investment Private Equity Fund | Korea | December | Financial<br>investment |  | 40232 | 80 | 40152 | 2737 | 2479 | 2479 | 70.00 |
|  Corporate Liquidity Assistance Agency Co., Ltd. | Korea | December | Financial<br>investment |  | 1672215 | 604360 | 1067855 | 61571 | 2893 | 2893 | 100.00 |
|  Associates: |  |  |  |  |  |  |  |  |  |  |  |
|  Korea Electric Power Co., Ltd. | Korea | December | Electricity<br>generation |  | 239714965 | 202450215 | 37264750 | 88219461 | (4822549) | (5032584) | 32.90 |
|  Korea Tourism Organization | Korea | December | Culture and<br>tourism<br>administration |  | 1213223 | 398563 | 814660 | 868365 | 6129 | (8016) | 43.58 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**11. <u>Investments in Subsidiaries and Associates, Continued</u>**

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Country** | **Fiscal<br>year end** | **Industry** | **Assets** | **Liabilities** | **Equity** | **Operating<br>revenue** | **Net<br>income<br>(loss)** | **Total<br>compre-<br>hensive<br>income<br>(loss)** | **Owner-<br>ship<br>(%)** |
|  Korea Infrastructure Fund II | Korea | December | Financial<br>investment | 892813 | 88389 | 804424 | 105605 | 98850 | 98850 | 26.67 |
|  Korea Ocean Business Corporation | Korea | December | Finance | 12445716 | 4765386 | 7680330 | 382768 | (579708) | (371921) | 20.80 |
|  Korea Real Estate Board | Korea | December | Appraisal | 297439 | 52429 | 245010 | 226450 | 17028 | 11072 | 30.60 |
|  GM Korea Company (\*3) | Korea | December | Manufacturing | 8040972 | 4673023 | 3367949 | 13829398 | 1642204 | 1642204 | 17.02 |
|  HMM Co., Ltd. | Korea | December | Foreign cargo<br>transportation | 25713363 | 4272550 | 21440813 | 8400969 | 968560 | 1323878 | 29.20 |
|  HANJIN KAL (\*3) | Korea | December | Holding<br>company | 3784922 | 931046 | 2853876 | 275727 | 385139 | 301583 | 10.58 |
|  Korean Air Lines Co., Ltd. (\*3) | Korea | December | Air passenger<br>transportation | 30391776 | 20576568 | 9815208 | 16111796 | 1061165 | 814521 | 3.32 |
|  Hanwha Ocean Co., Ltd. (\*3) | Korea | December | Manufacturing | 13944773 | 9632616 | 4312157 | 7408312 | 159886 | (10004) | 19.50 |

---

---

| | |
|:---|:---|
| (\*1) | The investees are financed by the Bank and managed by KDB Infrastructure Investments Asset Management Co., Ltd. They were included in the scope of consolidation even though the Bank holds less than half of the voting rights because the Bank is exposed to variable returns and has the ability to affect those returns through its power over the investee.  |

---

---

| | |
|:---|:---|
| (\*2) | Although the Bank's shareholding in the investee is less than 50%, it controls the investee since it is exposed, or has right to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.  |

---

---

| | |
|:---|:---|
| (\*3) | Although the Bank's shareholding is less than 20%, the Bank has significant influence considering the right to elect the investees' directors and the Bank classifies the companies as associates.  |

---

---

| | |
|:---|:---|
| (\*4) | Although the Bank's shareholding is less than 20%, as the main creditor bank, the Bank have initiated management procedures that designate the Bank as the managing institution. Consequently, the Bank have acquired significant influence, such as the ability to participate in the financial and operating policies of the company and have classified it as an associate.  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**12. <u>Property and Equipment</u>** 

Changes in property and equipment for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **January 1,<br>2024** | **January 1,<br>2024** | **Acquisition/<br>depreciation** | **Disposal** | **Reclassifi-<br>cation** | **Foreign<br>exchange<br>differences** | **December 31,<br>2024** |
|  Acquisition cost: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land | W | 307481 |  |  | 10307 |  | 317788 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 635054 | 1351 |  | 7315 |  | 643720 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Leasehold improvements |  | 46003 | 261 |  | 1309 | 70 | 47643 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vehicles |  | 585 |  |  |  | 45 | 630 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equipment |  | 62730 | 1973 | (997) |  | 481 | 64187 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Construction in progress |  | 1817 | 7722 |  | (9539) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Real estate) |  | 122090 | 25216 | (24202) |  | 10252 | 133356 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Vehicles) |  | 11245 | 3640 | (2004) |  | 213 | 13094 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Others) |  | 93 | 61 | (19) |  | 17 | 152 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 170173 | 15152 | (304) |  | 622 | 185643 |
|  |  | 1357271 | 55376 | (27526) | 9392 | 11700 | 1406213 |
|  Accumulated depreciation: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures(\*) |  | 254358 | 19840 |  | 436 |  | 274634 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Leasehold improvements |  | 37520 | 2916 |  |  | (474) | 39962 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vehicles |  | 544 | 9 |  |  | 40 | 593 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equipment |  | 51321 | 4052 | (994) |  | 346 | 54725 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Real estate) |  | 51066 | 33742 | (19465) |  | 4734 | 70077 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Vehicles) |  | 5277 | 3280 | (1853) |  | 118 | 6822 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Others) |  | 37 | 53 | (19) |  | 9 | 80 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 149680 | 9964 | (294) |  | 448 | 159798 |
|  |  | 549803 | 73856 | (22625) | 436 | 5221 | 606691 |
|  Accumulated impairment losses: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land |  | 3023 |  |  |  |  | 3023 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 2361 |  |  |  |  | 2361 |
|  |  | 5384 |  |  |  |  | 5384 |
|  | W | &nbsp;&nbsp;&nbsp;&nbsp;802084 | (18480) | (4901) | 8956 | 6479 | 794138 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**12. <u>Property and Equipment, Continued</u>**

---

| | |
|:---|:---|
| (\*) | The amounts include government grants.  |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **January 1,<br>2023** | **January 1,<br>2023** | **Acquisition/<br>depreciation** | **Disposal** | **Reclassifi-<br>cation** | **Foreign<br>exchange<br>differences** | **December 31,<br>2023** |
|  Acquisition cost: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land | W | 301959 |  | (35) | 5557 |  | 307481 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 627664 | 1811 | (1977) | 7556 |  | 635054 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Leasehold improvements |  | 44856 | 1390 | (1821) | 1439 | 139 | 46003 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vehicles |  | 719 |  | (141) |  | 7 | 585 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equipment |  | 60156 | 3525 | (1033) |  | 82 | 62730 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Construction in progress |  |  | 7389 |  | (5572) |  | 1817 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Real estate) |  | 126035 | 35211 | (40134) |  | 978 | 122090 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Vehicles) |  | 7977 | 4908 | (1652) |  | 12 | 11245 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Others) |  | 93 | 11 | (14) |  | 3 | 93 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 157730 | 12977 | (625) |  | 91 | 170173 |
|  |  | 1327189 | 67222 | (47432) | 8980 | 1312 | 1357271 |
|  Accumulated depreciation: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures(\*) |  | 233783 | 18032 | (780) | 3362 | (39) | 254358 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Leasehold improvements |  | 36391 | 2945 | (1821) |  | 5 | 37520 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vehicles |  | 628 | 57 | (141) |  |  | 544 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equipment |  | 47728 | 4518 | (976) |  | 51 | 51321 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Real estate) |  | 45968 | 33895 | (28366) |  | (431) | 51066 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Vehicles) |  | 4154 | 2800 | (1645) |  | (32) | 5277 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets (Others) |  | 9 | 41 | (14) |  | 1 | 37 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 140971 | 9219 | (584) |  | 74 | 149680 |
|  |  | 509632 | 71507 | (34327) | 3362 | (371) | 549803 |
|  Accumulated impairment losses: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land |  | 3023 |  |  |  |  | 3023 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 2361 |  |  |  |  | 2361 |
|  |  | 5384 |  |  |  |  | 5384 |
|  | W | &nbsp;&nbsp;&nbsp;&nbsp;812173 | (4285) | (13105) | 5618 | 1683 | 802084 |

---

---

| | |
|:---|:---|
| (\*) | The amounts include government grants.  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**13. <u>Investment Property</u>** 

Changes in investment property for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **January 1,<br>2024** | **January 1,<br>2024** | **Acquisition/<br>depreciation** | **Reclassification** | **December 31,<br>2024** |
|  Acquisition cost: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land | W | 55450 |  | (10307) | 45143 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 55992 |  | 915 | 56907 |
|  |  | 111442 |  | (9392) | 102050 |
|  Accumulated depreciation: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 34645 | 2293 | (436) | 36502 |
|  Accumulated impairment losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land |  | 1197 |  |  | 1197 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 1778 |  |  | 1778 |
|  |  | 2975 |  |  | 2975 |
|  | W | 73822 | (2293) | (8956) | 62573 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **January 1,<br>2023** | **January 1,<br>2023** | **Acquisition/<br>depreciation** | **Reclassification** | **December 31,<br>2023** |
|  Acquisition cost: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land | W | 61008 |  | (5558) | 55450 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 59414 |  | (3422) | 55992 |
|  |  | 120422 |  | (8980) | 111442 |
|  Accumulated depreciation: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 35734 | 2273 | (3362) | 34645 |
|  Accumulated impairment losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land |  | 1197 |  |  | 1197 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Buildings and structures |  | 1778 |  |  | 1778 |
|  |  | 2975 |  |  | 2975 |
|  | W | &nbsp;&nbsp;&nbsp;&nbsp;81713 | (2273) | (5618) | 73822 |

---

The fair value of the Bank's investment property, as determined based on valuation by an independent appraiser, amounts to W83,879 million and W92,553 million as of December 31, 2024 and 2023, respectively. Additionally, fair value of investment in property is classified as level 3 according to the fair value hierarchy in Note 44.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**14. <u>Intangible Assets</u>** 

Changes in intangible assets for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **January 1,<br>2024** | **January 1,<br>2024** | **Acquisition** | **Disposal** | **Amortization** | **Foreign<br>exchange<br>differences<br>and others** | **December 31,<br>2024** |
|  Development expense | W | 55907 | 13882 |  | (34802) | 309 | 35296 |
|  Equipment usage right |  | 409 |  |  | (52) | 47 | 404 |
|  Other deposits provided |  | 11542 |  | (100) |  | 43 | 11485 |
|  Others |  | 17603 | 4684 |  | (7867) | 566 | 14986 |
|  | W | &nbsp;&nbsp;&nbsp;&nbsp;85461 | 18566 | (100) | (42721) | 965 | 62171 |
|  | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **January 1,<br>2023** | **January 1,<br>2023** | **Acquisition** | **Disposal** | **Amortization** | **Foreign<br>exchange<br>differences<br>and others** | **December 31,<br>2023** |
|  Development expense | W | 87593 | 14575 |  | (46135) | (126) | 55907 |
|  Equipment usage right |  | 452 | 363 |  | (50) | (356) | 409 |
|  Other deposits provided |  | 11789 |  | (267) |  | 20 | 11542 |
|  Others |  | 18655 | 7435 |  | (8858) | 371 | 17603 |
|  | W | 118489 | 22373 | (267) | (55043) | (91) | 85461 |

---

**15. <u>Other Assets</u>** 

Other assets as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Accounts receivable | W | 4380521 | 6676728 |
|  Unsettled domestic exchange receivables |  | 1933905 | 1938307 |
|  Accrued income |  | 1108382 | 1200380 |
|  Guarantee deposits |  | 446219 | 343333 |
|  Prepaid expenses |  | 20903 | 19000 |
|  Advance payments |  | 8648 | 8555 |
|  Financial guarantee asset |  | 50298 | 48182 |
|  Others |  | 183774 | 21330 |
|  |  | 8132650 | 10255815 |
|  Allowance for credit losses |  | (72514) | (76445) |
|  Present value discount |  | (3618) | (3587) |
|  | W | &nbsp;&nbsp;&nbsp;&nbsp;8056518 | 10175783 |

---

The carrying amounts of financial assets included in other assets above amounted to W7,798,105 million and W10,136,642 million as of December 31, 2024 and 2023, respectively, and their fair value amounted to W7,797,591 million and W10,133,962 million as of December 31, 2024 and 2023, respectively.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**16. <u>Financial Liabilities Measured at FVTPL</u>** 

(1) Financial liabilities measured at fair value through profit or loss as of December 31, 2024 and 2023 are
as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  Debentures | W | 1806079 |  | 1515655 |
|  Deposits |  | 583167 |  | 404406 |
|  | W | 2389246 |  | 1920061 |

---

Changes in fair value of structured debentures and deposits to which hedge accounting is applied are recognized in profit or loss, but structured debentures not subject to hedge accounting applied to, are measured at amortized costs. Therefore, such structured debentures and deposits, not subject to hedge accounting, have been designated at FVTPL to eliminate mismatch in measurements of accounting profit and loss.

(2) The difference between the carrying amount and contractual cash flow amount of financial liabilities measured
at fair value through profit or loss as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Carrying amount | W | 2389246 | 1920061 |
|  Contractual cash flow amounts |  | 2787200 | 2380244 |
|  Difference | W | (397954) | (460183) |

---

**17. <u>Deposits</u>** 

Deposits as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  | **Amortized cost** | **Amortized cost** | **Fair value** | **Amortized cost** | **Fair value** |
|  Deposits in Korean won: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Demand deposits | W | 104173 | 104173 | 155186 | 155186 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Time and savings deposits |  | 47088629 | 47156011 | 51011074 | 51054680 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Certificates of deposit |  | 505159 | 505223 | 74363 | 74080 |
|  |  | 47697961 | 47765407 | 51240623 | 51283946 |
|  Deposits in foreign currencies: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Demand deposits |  | 963783 | 962800 | 836797 | 836658 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Time and savings deposits |  | 7776645 | 7739508 | 6049678 | 6045288 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Certificates of deposit |  | 8651522 | 8677085 | 6866270 | 6880941 |
|  |  | 17391950 | 17379393 | 13752745 | 13762887 |
|  Off-shore deposits in foreign currencies: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Demand deposits |  | 1010662 | 1010662 | 904364 | 904364 |
|  | W | 66100573 | 66155462 | 65897732 | 65951197 |

---

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**18. <u>Borrowings</u>** 

(1) Borrowings as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Minimum<br>interest rate (%)** | **Maximum<br>interest rate (%)** | **Amortized cost** | **Amortized cost** | **Fair value** |
|  Borrowings in Korean won |  | 2.91 | W | 4689044 | 4641896 |
|  Borrowings in foreign currencies | 0.40 | 6.91 |  | 20545564 | 20489948 |
|  Off-shore borrowings in foreign currencies | 2.25 | 5.32 |  | 3478482 | 3463100 |
|  Others | 0.43 | 5.68 |  | 4023136 | 4002350 |
|  |  |  |  | 32736226 | 32597294 |
|  Deferred borrowing costs |  |  |  | (5708) |  |
|  |  |  | W | 32730518 |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Minimum<br>interest rate (%)** | **Maximum<br>interest rate (%)** | **Amortized cost** | **Amortized cost** | **Fair value** |
|  Borrowings in Korean won | 0.10 | 3.41 | W | 4787182 | 4726465 |
|  Borrowings in foreign currencies | 0.14 | 7.38 |  | 16655307 | 16584979 |
|  Off-shore borrowings in foreign currencies | 2.42 | 6.18 |  | 4011646 | 3985025 |
|  Others |  | 6.02 |  | 2298142 | 2293650 |
|  |  |  |  | 27752277 | 27590119 |
|  Deferred borrowing costs |  |  |  | (6648) |  |
|  |  |  | W | 27745629 |  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**18. <u>Borrowings, Continued</u>**

(2) Borrowings in Korean won before adjusting for gains and losses on deferred borrowing costs as of
December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Lender** | **Classification** | **Annual**<br>**interest rate**<br>**(%)** | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Ministry of Economy and Finance | Borrowings from government fund (\*) | 2.40 ~ 2.53 | W | 62184 | 77629 |
|  Korea SMEs and Startups Agency | Borrowings from small and medium enterprise promotion fund | 1.20 ~ 2.40 |  | 64390 | 59171 |
|  Ministry of Culture, Sports and Tourism | Borrowings from tourism promotion fund | 0.78 ~ 2.03 |  | 2946821 | 3080914 |
|  Korea Energy Agency | Borrowings from fund for rational use of energy | 0.25 ~ 1.75 |  | 280245 | 256472 |
|  Local governments | Borrowings from local small and medium enterprise promotion fund | 0.50 ~ 2.80 |  | 19160 | 22620 |
|  The Bank of Korea | Borrowings from Bank of Korea |  |  | 330451 | 418866 |
|  Others | Borrowings from petroleum enterprise fund and others | 0.00 ~ 2.91 |  | 985793 | 871510 |
|  |  |  | W | 4689044 | 4787182 |

---

(\*) Borrowings from government fund are subordinated borrowings.

(3) Borrowings and off-shore borrowings in foreign currencies before adjusting for gains and losses on deferred
borrowing costs as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Lender** | **Classification** | **Annual**<br>**interest rate (%)** | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Mizuho and others | Bank loans from foreign funds | 2.96 ~ 5.59 | W | 2798873 | 2076759 |
|  The Export-Import Bank of Korea | Exchange equalization fund borrowings in foreign currencies |  |  |  | 23931 |
|  Bank of New York Mellon, London and others | Off-shore short term borrowings | 2.61 ~ 5.31 |  | 1757295 | 2185972 |
|  China Development Bank and others | Off-shore long term borrowings | 2.25 ~ 5.32 |  | 1721187 | 1825674 |
|  Others | Short-term borrowings in foreign currencies | 0.40 ~ 6.91 |  | 16412709 | 13730337 |
|  | Long term borrowings in foreign currencies | 0.94 ~ 6.63 |  | 1333982 | 824280 |
|  |  |  | W | 24024046 | 20666953 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**19. <u>Debentures</u>** 

Debentures as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Minimum<br>interest rate (%)** | **Maximum<br>interest rate (%)** | **Amortized cost** | **Amortized cost** | **Fair value** |
|  Debentures in Korean won: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | 0.98 | 7.05 | W | 113968049 | 114467840 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Discount on debentures |  |  |  | (178440) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation adjustment for fair value hedges |  |  |  | (120391) |  |
|  |  |  |  | 113669218 |  |
|  Debentures in foreign currencies: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | 0.75 | 11.24 |  | 29840263 | 30907953 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Discount on debentures |  |  |  | (41691) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation adjustment for fair value hedges |  |  |  | (444851) |  |
|  |  |  |  | 29353721 |  |
|  Off-shore debentures: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | 0.17 | 11.21 |  | 21912152 | 22276988 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Discount on debentures |  |  |  | (56870) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation adjustment for fair value hedges |  |  |  | 224048 |  |
|  |  |  |  | 22079330 |  |
|  |  |  | W | 165102269 | 167652781 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**19. <u>Debentures, Continued</u>**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Minimum<br>interest rate (%)** | **Maximum<br>interest rate (%)** | **Amortized cost** | **Amortized cost** | **Fair value** |
|  Debentures in Korean won: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | 0.96 | 6.60 | W | 115066663 | 114805330 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Discount on debentures |  |  |  | (147257) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation adjustment for fair value hedges |  |  |  | (226273) |  |
|  |  |  |  | 114693133 |  |
|  Debentures in foreign currencies: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | 0.40 | 10.87 |  | 23278766 | 23733405 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Discount on debentures |  |  |  | (36276) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Premium on debentures |  |  |  | 47 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation adjustment for fair value hedges |  |  |  | (561938) |  |
|  |  |  |  | 22680599 |  |
|  Off-shore debentures: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  | 11.15 |  | 19628771 | 19359808 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Discount on debentures |  |  |  | (62251) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation adjustment for fair value hedges |  |  |  | (6385) |  |
|  |  |  |  | 19560135 |  |
|  |  |  | W | 156933867 | 157898543 |

---

**20. <u>Defined Benefit Assets</u>** 

The Bank implements a defined benefit retirement pension plan based on employee compensation benefits and service periods. The plan assets are in trusts with Kookmin Bank, Samsung Life Insurance Co., Ltd., etc.

(1) Details of defined benefit assets as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Present value of defined benefit liabilities | W | 429017 | 389839 |
|  Fair value of plan assets |  | (459985) | (458759) |
|  | W | (30968) | (68920) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**20. <u>Defined Benefit Assets, Continued</u>**

(2) Changes in defined benefit assets for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** |
|  | **Present value of<br>defined benefit<br>obligation** | **Present value of<br>defined benefit<br>obligation** | **Fair value of<br>plan assets** | **Defined benefit<br>assets** |
|  Beginning balance | W | 389839 | (458759) | (68920) |
|  Current service costs |  | 28508 |  | 28508 |
|  Interest expense (income) |  | 16958 | (20586) | (3628) |
|  Remeasurements of defined benefit liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Demographic assumption |  | (5276) |  | (5276) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assumption |  | 20488 | 2881 | 23369 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Experience adjustment |  | 5135 |  | 5135 |
|  |  | 20347 | 2881 | 23228 |
|  Payments from the plan |  | (26636) | 16479 | (10157) |
|  Others |  | 1 |  | 1 |
|  Ending balance | W | 429017 | (459985) | (30968) |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** |
|  | **Present value of<br>defined benefit<br>obligation** | **Present value of<br>defined benefit<br>obligation** | **Fair value of<br>plan assets** | **Defined benefit<br>assets** |
|  Beginning balance | W | 354703 | (442473) | (87770) |
|  Current service costs |  | 26974 |  | 26974 |
|  Interest expense (income) |  | 18219 | (23149) | (4930) |
|  Remeasurements of defined benefit liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Demographic assumption |  | 62 |  | 62 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assumption |  | 25482 | 2713 | 28195 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Experience adjustment |  | (6136) |  | (6136) |
|  |  | 19408 | 2713 | 22121 |
|  Payments from the plan |  | (29465) | 4150 | (25315) |
|  Ending balance | W | 389839 | (458759) | (68920) |

---

(3) Fair value of plan assets for each type as of December 31, 2024 and 2023 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Quoted**<br>**market**<br>**prices** | **Unquoted<br>market**<br>**prices** | **Unquoted<br>market**<br>**prices** | **Quoted**<br>**market<br>prices** | **Unquoted<br>market**<br>**Prices** | **Unquoted<br>market**<br>**Prices** |
|  Due from banks | W |  | 459985 |  |  | 458759 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**20. <u>Defined Benefit Assets, Continued</u>**

(4) Defined benefit costs recognized in profit or loss for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Current service costs | W | 28508 | 26974 |
|  Interest expense, net |  | (3628) | (4930) |
|  | W | 24880 | 22044 |

---

(5) The principal actuarial assumptions used as of December 31, 2024 and 2023 are as follows:

---

| | | |
|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2023** |
|  Discount rate (%) | 4.04 ~ 4.05 | 4.58 ~ 4.60 |
|  Future salary increasing rate (%) | 5.50 | 5.50 |

---

(6) The present value sensitivity of defined benefit obligation as changes in principal actuarial assumptions as of
December 31, 2024 is as follows:

---

| | | |
|:---|:---|:---|
|  | **Sensitivity** | **Sensitivity** |
|  | **1% increase in<br>assumption** | **1% decrease in<br>assumption** |
|  Discount rate | 8.15% decrease | 9.42% increase |
|  Future salary increasing rate | 9.19% increase | 8.12% decrease |

---

(7) The weighted average duration of defined benefit obligation is 9.63 years and 9.64 years as of
December 31, 2024 and 2023, respectively. In addition, there are no expected contributions to the plans for the next reporting period.

**21. <u>Provisions</u>** 

(1) Details of provisions as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Provision for payment guarantees | W | 434990 | 592098 |
|  Provision for unused commitments |  | 333175 | 398641 |
|  Provision for financial guarantee |  | 7560 | 50763 |
|  Provision for possible losses from lawsuits |  | 21573 | 168 |
|  Provision for restoration |  | 14181 | 13722 |
|  Other provision |  | 3391 | 3391 |
|  | W | 814870 | 1058783 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**21. <u>Provisions, Continued</u>**

(2) Changes in provision for payment guarantees for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | | | **Lifetime expected credit losses** | **Lifetime expected credit losses** | |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |<br>**Total** |
|  Beginning balance | W | 230436 | 317138 | &nbsp;&nbsp;&nbsp;&nbsp;44524 | 592098 |
|  Transfer to 12-month expected credit loss |  | 25360 | (25353) | (7) |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired exposures |  | (31313) | 31331 | (18) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired exposures |  | (979) | (314) | 1293 |  |
|  Reversal of payment guarantees |  | (9485) | (162576) | (38268) | (210329) |
|  Foreign currency translation |  | 1570 | 29957 | 21694 | 53221 |
|  Ending balance | W | 215589 | 190183 | 29218 | 434990 |
|  | **2023** | **2023** | **2023** | **2023** | **2023** |
|  |  |  | **Lifetime expected credit losses** | **Lifetime expected credit losses** |  |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** | **Total** |
|  Beginning balance | W | 64150 | 537255 | 352020 | 953425 |
|  Transfer to 12-month expected credit loss |  | 10730 | (9) | (10721) |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired exposures |  | (12582) | 65431 | (52849) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired exposures |  | (23162) |  | 23162 |  |
|  Provision for (reversal of) payment guarantees |  | 170444 | (306822) | (243459) | (379837) |
|  Foreign currency translation |  | 20856 | 21283 | (23629) | 18510 |
|  Ending balance | W | 230436 | 317138 | 44524 | 592098 |

---

(3) Changes in provision for unused commitments for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | | | **Lifetime expected credit losses** | **Lifetime expected credit losses** | |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |<br>**Total** |
|  Beginning balance | W | 114277 | 272952 | 11412 | 398641 |
|  Transfer to 12-month expected credit loss |  | 14759 | (14752) | (7) |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired exposures |  | (23897) | 24423 | (526) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired exposures |  |  | (2130) | 2130 |  |
|  Provision for (reversal of) unused commitments |  | 18978 | (159360) | 62634 | (77748) |
|  Foreign currency translation |  | 8629 | 3542 | 111 | 12282 |
|  Ending balance | W | 132746 | 124675 | 75754 | 333175 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**21. <u>Provisions, Continued</u>**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | | | **Lifetime expected credit losses** | **Lifetime expected credit losses** | |
|  | **12-month<br>expected<br>credit loss** | **12-month<br>expected<br>credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |<br>**Total** |
|  Beginning balance | W | 121771 | 300309 | 9310 | 431390 |
|  Transfer to 12-month expected credit loss |  | 1277 | (985) | (292) |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired exposures |  | (242717) | 249928 | (7211) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired exposures |  | (8993) | (1957) | 10950 |  |
|  Provision for (reversal of) unused commitments |  | 241633 | (275209) | (1346) | (34922) |
|  Foreign currency translation |  | 1306 | 866 | 1 | 2173 |
|  Ending balance | W | 114277 | 272952 | 11412 | 398641 |

---

(4) Changes of financial guarantee provision for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | | | **Lifetime expected credit losses** | **Lifetime expected credit losses** | |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |<br>**Total** |
|  Beginning balance | W | 3122 | 42240 | 5401 | 50763 |
|  Transfer to 12-month expected credit loss |  |  |  |  |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired exposures |  | (260) | 260 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired exposures |  |  | (14) | 14 |  |
|  Provision for (reversal of) financial guarantee |  | 58 | (39277) | (3984) | (43203) |
|  Ending balance | W | 2920 | 3209 | 1431 | 7560 |
|  | **2023** | **2023** | **2023** | **2023** | **2023** |
|  |  |  | **Lifetime expected credit losses** | **Lifetime expected credit losses** |  |
|  | **12-month<br>expected credit<br>loss** | **12-month<br>expected credit<br>loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** | **Total** |
|  Beginning balance | W | 661 | 36682 | 5398 | 42741 |
|  Transfer to 12-month expected credit loss |  | 412 | (343) | (69) |  |
|  Transfer to lifetime expected credit losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to non credit-impaired exposures |  | (42) | 71 | (29) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer to credit-impaired exposures |  |  | (3190) | 3190 |  |
|  Provision for (reversal of) financial guarantee |  | 2091 | 9020 | (3089) | 8022 |
|  Ending balance | W | 3122 | 42240 | 5401 | 50763 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**21. <u>Provisions, Continued</u>**

(5) Changes of lawsuit provision and other provision for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** |
|  | **Lawsuit<br>provision** | **Lawsuit<br>provision** | **Provision for<br>restoration** | **Other<br>provision** |
|  Beginning balance | W | 168 | 13722 | 3391 |
|  Increase (reversal) of provision |  | 21405 | (109) |  |
|  Provision used and others |  |  | 568 |  |
|  Ending balance | W | 21573 | 14181 | 3391 |
|  | **2023** | **2023** | **2023** | **2023** |
|  | **Lawsuit<br>provision** | **Lawsuit<br>provision** | **Provision for<br>restoration** | **Other<br>provision** |
|  Beginning balance | W | 239 | 14206 | 6029 |
|  Increase (reversal) of provision |  | (4) | (493) |  |
|  Provision used and others |  | (67) | 9 | (2638) |
|  Ending balance | W | 168 | 13722 | 3391 |

---

(6) Provision for payment guarantees and financial guarantee provision

Confirmed acceptances and guarantees, unconfirmed acceptances and guarantees and bills endorsed are not recognized on the statement of financial position, but are disclosed as off-statement of financial position items in the notes to the financial statements. The Bank provides a provision for such off-statement of financial position items, applying a Credit Conversion Factor ("CCF") and provision rates under the Bank's expected credit loss model, and records the provision as a reserve for expected credit losses on acceptances and guarantees.

In the case of financial guarantee contracts, when the amount calculated using the same method as above is greater than the initial amount less amortization of fees recognized, the difference is recorded as a financial guarantee provision.

(7) Provision for unused commitments

The Bank records a provision for a certain portion of unused credit lines which is calculated using a CCF as provision for unused commitments applying provision rates under the Bank's expected credit loss model.

(8) Provision for possible losses from lawsuits

As of December 31, 2024, the Bank is involved in 3 lawsuits as a plaintiff and 18 lawsuits as a defendant. The aggregate amounts of claims as a plaintiff and a defendant amounted to W17,596 million and W116,422 million, respectively. The Bank provided a provision against contingent loss from pending lawsuits as of December 31, 2024 and additional losses may be incurred depending on the result of pending lawsuits.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**21. <u>Provisions, Continued</u>**

Major lawsuits in progress as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Contents** | **Amounts** | **Amounts** |
|  Plaintiff: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hanil Engineering & Construction Co., Ltd | Appeal against the confirmed decision on Investigation | W | 16900 1<sup>st</sup> trial in progress |
|  Defendant: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 257 individuals including Mr. Kang | Claim for wage |  | 41853 1<sup>st</sup> trial in progress |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Shinhan Bank and Woori Bank | Claim for damages |  | 31711 1<sup>st</sup> trial ruled in favor of the Bank; 2<sup>nd</sup> trial partially ruled against the Bank |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dongbu Corporation | Claim for objection of request (participation to support) |  | 19658 1<sup>st</sup> trial in progress |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; One individual | Claim for cancellation of pledge |  | 8610 1<sup>st</sup> trial ruled in favor of the Bank; 2<sup>nd</sup> trial in progress |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Contents** | **Amounts** | **Amounts** |
|  Plaintiff: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Trade Insurance Corporation and one other | Claim for guarantee insurance | W | 136538 1<sup>st</sup>, 2<sup>nd</sup> trial ruled against the Bank; 3<sup>rd</sup> trial in progress |
|  Defendant: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Shinhan Bank and Woori Bank | Claim for damages |  | 76838 1<sup>st</sup> trial ruled in favor of the Bank |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 131 individuals including Mr. Kang | Claim for wage |  | 35459 1<sup>st ,</sup> 2<sup>nd</sup> trial ruled in favor of the Bank |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dongbu Corporation | Claim for nullity of table of rehabilitation creditor |  | 33997 1<sup>st</sup> trial ruled in favor of the Bank; 2<sup>nd</sup> trial ruled against the Bank; 3<sup>rd</sup> trial in progress |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dongbu Corporation | Claim for objection of request (participation to support) |  | 19658 1<sup>st</sup> trial in progress |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Woori Bank | Claim for profit and loss settlement |  | 14500 1<sup>st</sup>, 2<sup>nd</sup> trial ruled against the Bank; 3<sup>rd</sup> trial in progress |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Trade Insurance Corporation | Claim for recovery |  | 11870 1<sup>st</sup> trial in progress |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; One individual | Claim for cancellation of pledge |  | 8610 1<sup>st</sup> trial in progress |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**21. <u>Provisions, Continued</u>**

(9) Other provision

The Bank recognised other provision as a reserve for other miscellaneous purpose.

**22. <u>Other Liabilities</u>** 

(1) Other liabilities as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Accounts payable | W | 4345402 | 6627972 |
|  Lease liabilities |  | 83444 | 97231 |
|  Accrued expense |  | 2862819 | 2515484 |
|  Advance receipts |  |  | 32 |
|  Unearned income |  | 82097 | 91617 |
|  Deposits withholding tax |  | 59273 | 52038 |
|  Guarantee money received |  | 911670 | 718975 |
|  Foreign exchanges payable |  | 23229 | 19088 |
|  Domestic exchanges payable |  | 255049 | 533833 |
|  Borrowing from trust accounts |  | 1007782 | 1037094 |
|  Financial guarantee liability |  | 52963 | 50388 |
|  Others |  | 315872 | 381831 |
|  |  | 9999600 | 12125583 |
|  Present value discount |  | (16127) | (25158) |
|  | W | 9983473 | 12100425 |

---

The carrying amount of financial liabilities included in other liabilities above amounted to W9,778,765 million and W11,823,274 million as of December 31, 2024 and 2023, respectively, and their fair value amounted to W9,740,722 million and W11,800,828 million as of December 31, 2024 and 2023, respectively.

(2) Details of lease liabilities as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Face value** | **Face value** | **Discount** | **Carrying<br>amounts** |
|  Real estate | W | 76406 | (14363) | 62043 |
|  Vehicles |  | 6952 | (215) | 6737 |
|  Others |  | 86 | (9) | 77 |
|  | W | 83444 | (14587) | 68857 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Face value** | **Face value** | **Discount** | **Carrying<br>amounts** |
|  Real estate | W | 90518 | (22984) | 67534 |
|  Vehicles |  | 6657 | 462 | 7119 |
|  Others |  | 56 | (2) | 54 |
|  | W | 97231 | (22524) | 74707 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**22. <u>Other Liabilities, Continued</u>**

(3) The amount related to lease recognized in profit or loss for the years ended December 31, 2024 and 2023
are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Depreciation of right-of-use assets |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Real estate | W | 33742 | 33895 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Vehicles |  | 3280 | 2800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 53 | 41 |
|  |  | 37075 | 36736 |
|  Interest expenses on the lease liabilities |  | 2474 | 2772 |
|  Expense relating to leases of low-value assets |  | 8760 | 8801 |
|  | W | 48309 | 48309 |

---

(4) Cash flows used in lease liabilities for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
|  Decrease in lease liabilities | W | 33273 |  | 24477 |
|  Lease payments relating to leases of low-value assets |  | 8760 |  | 8801 |
|  | W | 42033 |  | 33278 |

---

(5) Maturity analysis of undiscounted lease payments relating to lease liabilities as of December 31, 2024 and
2023 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Within**<br>**3 months** | **Within**<br>**3 months** | **3 months**<br>**~ 1 year** | **1 year ~<br>5 years** | **Over**<br>**5 years** | **Total** |
|  Lease payments | W | 10711 | 25614 | 36338 | 10781 | 83444 |
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Within**<br>**3 months** | **Within**<br>**3 months** | **3 months**<br>**~ 1 year** | **1 year ~<br>5 years** | **Over**<br>**5 years** | **Total** |
|  Lease payments | W | 10111 | 24687 | 49975 | 12458 | 97231 |

---

**23. <u>Equity</u>** 

***(1) Issued capital***

The Bank is authorized to issue up to 6,000 million shares of common stock and has 5,263,311,768 shares issued and 4,785,311,768 shares issued as of December 31, 2024 and 2023, respectively, and outstanding with a total par value (W5,000 of par value per share) of W26,316,559 million and W23,926,559 million as of December 31, 2024 and 2023, respectively.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**23. <u>Equity, Continued</u>**

***(2) Capital surplus***

Capital surplus as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  Paid-in capital in excess of par value | W | 22138 |  | 33847 |
|  Surplus from capital reduction(\*1) |  | 44373 |  | 44373 |
|  Other capital surplus(\*2) |  | 2390495 |  | 2390495 |
|  | W | 2457006 |  | 2468715 |

---

---

| | |
|:---|:---|
| (\*1) | The Bank reduced W5,178,600 million of its issued capital in 1998 and 2000 to offset its accumulated deficit amounting to W5,134,227 million. As the result of the capital reduction, W44,373 million of surplus exceeding accumulated deficit was recorded in capital surplus in equity.  |

---

---

| | |
|:---|:---|
| (\*2) | The difference in the amount of shares issued and the carrying value of net asset acquired occurring from the merger of the Bank with KDB Financial Group Inc. and Korea Finance Corporation are recognized as other capital surplus.  |

---

***(3) Accumulated other comprehensive income***

(i) Accumulated other comprehensive income as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Net gain on securities measured at FVOCI |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation gain on securities measured at FVOCI (before tax) | W | 1136394 | 2528823 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss allowance for securities measured at FVOCI (before tax) |  | 95613 | 90422 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income tax effect |  | (325250) | (691480) |
|  |  | 906757 | 1927765 |
|  Exchange differences on translation of foreign operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exchange differences on translation of foreign operations (before tax) |  | 408725 | 152225 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income tax effect |  |  |  |
|  |  | 408725 | 152225 |
|  Valuation gain on cash flow hedge: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation gain on cash flow hedge (before tax) |  | 1045 | 4034 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income tax effect |  | (276) | (1065) |
|  |  | 769 | 2969 |
|  Net gain (loss) on hedges of net investments in foreign operations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net gain (loss) on hedges of net investments in foreign operations (before tax) |  | (283997) | (117276) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income tax effect |  | 74976 | 30961 |
|  |  | (209021) | (86315) |
|  Remeasurements of defined benefit liabilities: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Remeasurements of defined benefit liabilities (before tax) |  | 97330 | 120558 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income tax effect |  | (25694) | (31826) |
|  |  | 71636 | 88732 |
|  Fair value changes on financial liabilities designated at fair value due to credit risk: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Valuation gain on financial liabilities designated at fair value due to credit risk (before tax) |  | 78615 | 99153 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income tax effect |  | (20756) | (26178) |
|  |  | 57859 | 72975 |
|  | W | 1236725 | 2158351 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**23. <u>Equity, Continued</u>**

(ii) Changes in accumulated other comprehensive income for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **January 1,**<br>**2024** | **January 1,**<br>**2024** | **Increase**<br>**(Decrease)** | **Tax Effect** | **December 31,<br>2024** |
|  Gain (loss) on securities measured at FVOCI | W | 1927765 | (1387238) | 366230 | 906757 |
|  Exchange differences on translation of foreign operations |  | 152225 | 256500 |  | 408725 |
|  Valuation gain on cash flow hedge |  | 2969 | (2989) | 789 | 769 |
|  Net loss on hedges of net investments in foreign operations |  | (86315) | (166721) | 44015 | (209021) |
|  Remeasurements of defined benefit liabilities |  | 88732 | (23228) | 6132 | 71636 |
|  Valuation gain (loss) on financial liabilities designated at fair value due to credit risk |  | 72975 | (20538) | 5422 | 57859 |
|  | W | 2158351 | (1344214) | 422588 | 1236725 |
|  | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **January 1,**<br>**2023** | **January 1,**<br>**2023** | **Increase**<br>**(Decrease)** | **Tax Effect** | **December 31,<br>2023** |
|  Gain (loss) on securities measured at FVOCI | W | 2557521 | (860375) | 230619 | 1927765 |
|  Exchange differences on translation of foreign operations |  | 132126 | 20099 |  | 152225 |
|  Valuation gain on cash flow hedge |  | 5322 | (3207) | 854 | 2969 |
|  Net loss on hedges of net investments in foreign operations |  | (71202) | (20402) | 5289 | (86315) |
|  Remeasurements of defined benefit liabilities |  | 104870 | (22120) | 5982 | 88732 |
|  Valuation gain (loss) on financial liabilities designated at fair value due to credit risk |  | 90696 | (24245) | 6524 | 72975 |
|  | W | 2819333 | (910250) | 249268 | 2158351 |

---

***(4) Retained earnings***

In accordance with the *Korea Development Bank Act,* the Bank is required to appropriate at least 40% of net income as a legal reserve. This reserve can be transferred to paid-in capital or offset an accumulated deficit.

In accordance with the *Korea Development Bank Act*, the Bank offsets an accumulated deficit with reserves. If the reserve is insufficient to offset the accumulated deficit, the Korean government is responsible for the deficit.

(i) Retained earnings as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  Legal reserve | W | 3725456 |  | 2721885 |
|  Voluntary reserve |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Regulatory reserve for loan losses |  | 77581 |  | 211996 |
|  Unappropriated retained earnings |  | 9111569 |  | 7943027 |
|  | W | 12914606 |  | 10876908 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**23. <u>Equity, Continued</u>**

(ii) Changes in legal reserve for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
|  Beginning balance | W | 2721885 |  | 2535892 |
|  Transfer from retained earnings |  | 1003571 |  | 185993 |
|  Ending balance | W | 3725456 |  | 2721885 |

---

(iii) Changes in unappropriated retained earnings for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Beginning balance | W | 7943027 | 4439027 |
|  Contribution to legal reserve |  | (1003571) | (185993) |
|  Transfer from regulatory reserve for credit losses |  | 134415 | 35256 |
|  Dividends |  | (878125) | (164743) |
|  Reclassification of gain or loss on equity securities measured at FVOCI |  | 908665 | 792412 |
|  Profit for the year |  | 2007158 | 3027068 |
|  Ending balance | W | 9111569 | 7943027 |

---

(iv) Statements of appropriation of retained earnings for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023 (\*)** |
| I. Unappropriated retained earnings: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Unappropriated retained earning carried forward from the prior year | W | 5677605 | 4123547 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Effect of restatement due to reclassification of accounts |  | 518141 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on disposal of securities measured at FVOCI |  | 908665 | 792412 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Profit for the year |  | 2007158 | 2508927 |
|  |  | 9111569 | 7424886 |
| II. Transfers such as discretionary reserves |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transfer from to regulatory reserve for credit losses |  | 5029 | 134415 |
|  |  | 5029 | 134415 |
| III. Appropriation of retained earnings: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contribution to legal reserve |  | 802863 | 1003571 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Dividends (W144 for 2024 and W184 for 2023 per share) |  | 758706 | 878124 |
|  |  | 1561569 | 1881695 |
| IV. Unappropriated retained earnings to be carried over to subsequent year | W | 7555029 | 5677606 |

---

---

| | |
|:---|:---|
| (\*) | The comparative statement of appropriation of retained earnings for the year ended December 31, 2023 is the amount approved by the shareholders' meeting on March 28, 2024 and the amount of appropriation has been confirmed.  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**23. <u>Equity, Continued</u>**

***(5) Regulatory reserve for credit losses***

The Bank is required to provide a regulatory reserve for credit losses in accordance with *Regulations on Supervision of Banking Business 29(1) and (2)*. The details of regulatory reserve for credit losses are as follows:

(i) Regulatory reserve for credit losses as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Beginning balance | W | &nbsp;&nbsp;&nbsp;&nbsp;77581 | 211996 |
|  Planned reversal of reserve for credit losses |  | (5029) | (134415) |
|  Ending balance | W | 72552 | 77581 |

---

(ii) Required reversal of regulatory reserve for credit losses and profit after adjusting regulatory reserve for
loan losses for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Profit for the year | W | &nbsp;&nbsp;&nbsp;&nbsp;2007158 | 3027068 |
|  Obligated amount of reversal of regulatory reserve for credit losses |  | 5029 | 134415 |
|  Profit after adjusting regulatory reserve for credit losses | W | 2012187 | 3161483 |
|  Earnings per share after adjusting regulatory reserve for credit losses (in won) | W | 392 | 670 |

---

**24. <u>Net Interest Income</u>** 

Net interest income for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Interest income: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Due from banks | W | 388599 | 399442 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  | 88317 | 57273 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 879350 | 821316 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  | 339803 | 245955 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL |  | 15134 | 12326 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost |  | 10394661 | 9952712 |
|  |  | 12105864 | 11489024 |
|  Interest expense: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL |  | (111053) | (86275) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits |  | (2407111) | (2371427) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  | (1650814) | (1443925) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  | (6818821) | (6025878) |
|  |  | (10987799) | (9927505) |
|  | W | 1118065 | 1561519 |

---

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**25. <u>Net Fees and Commission Income</u>** 

Net fees and commission income for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Fees and commission income: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loan commissions | W | 169779 | 157190 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Underwriting and investment consulting commissions |  | 136894 | 96350 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Brokerage and agency commissions |  | 7959 | 8297 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Trust and retirement pension plan commissions |  | 39973 | 39059 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fees on asset management |  | 2519 | 1857 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other fees |  | 179233 | 145774 |
|  |  | 536357 | 448527 |
|  Fees and commission expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Brokerage and agency fees |  | (11738) | (11338) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other fees |  | (36903) | (27353) |
|  |  | (48641) | (38691) |
|  | W | 487716 | 409836 |

---

**26. <u>Dividend Income</u>** 

Dividend income for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
|  Securities measured at FVTPL | W | 347637 |  | 204838 |
|  Securities measured at FVOCI |  | 124583 |  | 121754 |
|  Investments in subsidiaries and associates |  | 565262 |  | 441778 |
|  | W | 1037482 |  | 768370 |

---

**27. <u>Net</u> <u>Gain</u> <u>on Securities Measured at FVTPL</u>** 

Net gain related to securities measured at FVTPL for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Gains on securities measured at FVTPL: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on sale | W | 229821 | 144875 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on valuation |  | 832528 | 632028 |
|  |  | 1062349 | 776903 |
|  Losses on securities measured at FVTPL: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on sale |  | (50521) | (92147) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on valuation |  | (291198) | (165930) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase related expense |  | (7) | (18) |
|  |  | (341726) | (258095) |
|  | W | 720623 | 518808 |

---

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**28. <u>Net Loss on Financial Liabilities Measured at FVTPL</u>** 

Net loss related to financial liabilities measured at fair value through profit or loss for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Gains on financial liabilities measured at FVTPL: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on valuation | W | &nbsp;&nbsp;&nbsp;&nbsp;61852 | 7049 |
|  <br> Losses on financial liabilities measured at FVTPL: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on redemption |  | (704) | (697) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on valuation |  | (112195) | (154456) |
|  |  | (112899) | (155153) |
|  | W | (51047) | (148104) |

---

**29. <u>Net</u> <u>Gain (</u><u>Loss</u><u>)</u> <u>on Securities Measured at FVOCI</u>** 

Net gain (loss) related to securities measured at FVOCI for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Gains on securities measured at FVOCI: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on sale | W | 33968 | 4717 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal of impairment losses |  | 1341 | 631 |
|  |  | 35309 | 5348 |
|  Losses on securities measured at FVOCI: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on sale |  | (972) | (9870) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Impairment losses |  | (3978) | (4898) |
|  |  | (4950) | (14768) |
|  | W | 30359 | (9420) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**30. <u>Net Gain (Loss) on Derivatives</u>** 

Net gain (loss) on derivatives for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Net gain on trading purpose derivatives: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on trading purpose derivatives: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest | W | 4553550 | 4693102 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  | 19806705 | 12626046 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock |  | 958 | 30210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on adjustment of derivatives |  | 4517 | 50960 |
|  |  | 24365730 | 17400318 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on trading purpose derivatives: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest |  | (4535164) | (4626262) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  | (19264769) | (12594489) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock |  | (814) | (1262) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on adjustment of derivatives |  | (10612) | (1977) |
|  |  | (23811359) | (17223990) |
|  |  | 554371 | 176328 |
|  Net gain (loss) on hedging purpose derivatives: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on hedging purpose derivatives: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest |  | 446804 | 891895 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  | 202263 | 754498 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on adjustment of derivatives |  | 218 | 28 |
|  |  | 649285 | 1646421 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on hedging purpose derivatives: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest |  | (129563) | (137354) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  | (1091968) | (255026) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on adjustment of derivatives |  | (422) | (653) |
|  |  | (1221953) | (393033) |
|  |  | (572668) | 1253388 |
|  Net loss on fair value hedged items: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on fair value hedged items: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on valuation |  | 567529 | 140424 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on redemption |  | 227081 | 199661 |
|  |  | 794610 | 340085 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on fair value hedged items: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on valuation |  | (1229042) | (1365202) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on redemption |  | (377022) | (403309) |
|  |  | (1606064) | (1768511) |
|  |  | (811454) | (1428426) |
|  | W | (829751) | 1290 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**30. <u>Net Gain (Loss) on Derivatives, Continued</u>**

Related with cash flow hedge, the Bank recognized W108 million of gain and W16 million of loss in the statements of comprehensive income as the ineffective portion for the years ended December 31, 2024 and 2023, respectively.

**31. <u>Net Foreign Currency Transaction Gain</u>** 

Net foreign currency transaction gain for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Net loss on foreign exchange transactions: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on foreign exchange transactions | W | 737968 | 923756 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on foreign exchange transactions |  | (743065) | (940205) |
|  |  | (5097) | (16449) |
|  Net gain on foreign currency translations: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on foreign currency translations |  | 28135177 | 8793292 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on foreign currency translations |  | (27265210) | (8474478) |
|  |  | 869967 | 318814 |
|  | W | 864870 | 302365 |

---

**32. <u>Other Operating Income (Expense), net</u>** 

Other operating income (expense) for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Other operating income: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on sale of loans | W | &nbsp;&nbsp;&nbsp;&nbsp;38680 | 28597 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on disposal of loans measured at FVTPL |  | 4126 | 8254 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on valuation of loans measured at FVTPL |  | 2534 | 7381 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gains on disposal of investments in subsidiaries and associates |  | 1422 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reversal of provisions |  | 246 | 634 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 42238 | 38856 |
|  |  | 89246 | 83722 |
|  Other operating expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on sale of loans |  | (64937) | (17256) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on disposal of loans measured at FVTPL |  | (6796) | (5332) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on valuation of loans measured at FVTPL |  | (26639) | (16294) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on disposal of investments in subsidiaries and associates |  | (8191) | (366) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Increase in provisions |  | (21543) | (137) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Insurance expenses |  | (98346) | (100830) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Credit guarantee fund salary |  | (229909) | (216076) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Educational taxes |  | (58426) | (54588) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Foreign security contributions |  | (11547) | (17587) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | (34156) | (41718) |
|  |  | (560490) | (470184) |
|  | W | (471244) | (386462) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**33. <u>Reversal of Credit Losses</u>** 

Reversal of credit losses for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Provision for (reversal of) loan loss allowance | W | &nbsp;&nbsp;&nbsp;&nbsp;90837 | (399011) |
|  Provision for (reversal of) other assets |  | (3683) | 3104 |
|  Reversal of payment guarantees |  | (210329) | (379837) |
|  Reversal of unused commitments |  | (77748) | (34922) |
|  Provision for (reversal of) financial guarantee provision |  | (43203) | 8022 |
|  | W | (244126) | (802644) |

---

**34. <u>General and Administrative Expenses</u>** 

General and administrative expenses for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Payroll costs: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Short-term employee benefits | W | 406425 | 393016 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Defined benefit costs |  | 24880 | 22044 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Defined contribution costs |  | 7425 | 7509 |
|  |  | 438730 | 422569 |
|  Depreciation and amortization: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation of property and equipment |  | 73856 | 71507 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Amortization of intangible assets |  | 42721 | 55043 |
|  |  | 116577 | 126550 |
|  Other: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Employee welfare benefits |  | 38677 | 35343 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Rent expenses |  | 5479 | 6586 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Taxes and dues |  | 40630 | 38170 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Advertising expenses |  | 19977 | 18377 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electronic data processing expenses |  | 89489 | 90068 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fees and charges |  | 42521 | 41000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 65003 | 45328 |
|  |  | 301776 | 274872 |
|  | W | 857083 | 823991 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**35. <u>Other Non-Operating Income and Expense</u>** 

Other non-operating income and expense for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Other non-operating income: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on disposal of property and equipment | W | 634 | 5291 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain on disposal of intangible assets |  | 29 | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Rental income on investment property |  | &nbsp;&nbsp;&nbsp;&nbsp;3105 | 3122 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 7819 | 8109 |
|  |  | 11587 | 16524 |
|  Other non-operating expense: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Losses on disposal of property and equipment |  | (1426) | (6373) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation of investment property |  | (2293) | (2273) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Donations |  | (19531) | (8574) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | (2530) | (2883) |
|  |  | (25780) | (20103) |
|  | W | (14193) | (3579) |

---

**36. <u>Income Tax Expense</u>** 

(1) Income tax expense for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Current income tax (\*) | W | &nbsp;&nbsp;&nbsp;&nbsp;492373 | 494903 |
|  Changes in income tax before the prior years |  | (209932) | (34323) |
|  Changes in deferred income taxes on temporary differences |  | 54557 | 356370 |
|  Effect of unused tax loss |  |  | 156618 |
|  Deferred income tax recognized directly to equity |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other comprehensive income |  | 422588 | 249268 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retained earnings |  | (325934) | (284235) |
|  Income tax expense | W | 433652 | 938601 |

---

(\*) Includes changes such as those that arise from final tax returns.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**36. <u>Income Tax Expense, Continued</u>**

(2) Profit before income taxes and income tax expense for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Profit before income taxes | W | 2440810 | 3965669 |
|  Income taxes calculated using enacted tax rates |  | 644374 | 1046937 |
|  Adjustments: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-deductible losses and tax-free gains |  | (23000) | (22887) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-recognition effect of deferred income taxes and others |  | (191773) | (148375) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net adjustments for prior years |  | (64048) | 10698 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 68099 | 52228 |
|  |  | (210722) | (108336) |
|  Income tax expense | W | 433652 | 938601 |
|  Effective tax rate (%) |  | 17.77 | 23.67 |

---

(3) Changes in temporary differences and deferred tax assets (liabilities) for the years ended December 31,
2024 and 2023 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **January 1,**<br>**2024(\*)** | **January 1,**<br>**2024(\*)** | **Decrease** | **Increase** | **December 31,<br>2024** | **Deferred tax<br>assets<br>(liabilities)** |
|  Derivatives | W | (293338) | (293338) | (578805) | (578805) | (152805) |
|  Investments in subsidiaries and associates |  | (8303869) | 732702 | (1377387) | (10413958) | (3138284) |
|  Gains on fair value hedged items valuation |  | (721347) | (721347) | (834323) | (834323) | (220261) |
|  Gains on foreign exchange translation for hedged liabilities |  | (365725) | (365725) | (54511) | (54511) | (14391) |
|  Impairment losses on debt securities |  | 65933 |  |  | 65933 | 17406 |
|  Impairment losses on equity securities |  | 11965 | (2814) | 88 | 14867 | 3925 |
|  Defined benefit obligation |  | 369485 | 26479 | 67256 | 410262 | 108309 |
|  Plan assets |  | (411139) | (26479) | (25602) | (410262) | (108309) |
|  Financial assets held for trading |  | (202890) | (151849) | (243453) | (294494) | (77746) |
|  Available-for-sale financial assets |  | (146414) | 521 |  | (146935) | 27 |
|  Write-off |  | 1665174 | 41184 | 40021 | 1664011 | 439299 |
|  Provisions |  | 498485 | 1005186 | 804040 | 297339 | 78497 |
|  Property impairment losses |  | 5939 | 173 |  | 5766 | 1522 |
|  Dividends Receivable |  | 17397 |  |  | 17397 | 4593 |
|  Loan origination fees |  | (32138) | (32138) | (40376) | (40376) | (10659) |
|  Gains on sales of loans |  | (2527985) |  |  | (2527985) | (667388) |
|  Others |  | (2282634) | (1410877) | (307961) | (1179718) | (296456) |
|  |  | (12653101) | (1198322) | (2551013) | (14005792) | (4032721) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**36. <u>Income Tax Expense, Continued</u>**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **January 1,**<br>**2024(\*)** | **January 1,**<br>**2024(\*)** | **Decrease** | **Increase** | **December 31,<br>2024** | **Deferred tax<br>assets<br>(liabilities)** |
|  Temporary differences from unrecognized deferred tax assets and liabilities: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in subsidiaries and associates, etc. |  | 2253148 | (983481) | (983481) | 1269667 |  |
|  | W | (14906249) |  |  | (15275459) | (4032721) |

---

(\*) Temporary differences as of January 1, 2024 reflected previous year's additional tax adjustment after the financial statements were issued.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **January 1,**<br>**2023 (\*)** | **January 1,**<br>**2023 (\*)** | **Decrease** | **Increase** | **December 31,<br>2023** | **Deferred tax<br>assets<br>(liabilities)** |
|  Derivatives | W | 1015549 | 1015549 | (293338) | (293338) | (77441) |
|  Investments in subsidiaries and associates |  | (8028677) | 4173 | (989365) | (9022215) | (2964927) |
|  Gains on fair value hedged items valuation |  | (1797984) | (1797984) | (721347) | (721347) | (190436) |
|  Gains on foreign exchange translation for hedged liabilities |  | (132878) | (132878) | (365725) | (365725) | (96551) |
|  Impairment losses on debt securities |  | 65933 |  |  | 65933 | 17406 |
|  Impairment losses on equity securities |  | 11935 | 50 | 80 | 11965 | 3159 |
|  Defined benefit obligation |  | 332684 | 29150 | 65951 | 369485 | 97544 |
|  Plan assets |  | (405768) | (29150) | (13222) | (389840) | (102918) |
|  Financial assets held for trading |  | (61685) | (10644) | (151849) | (202890) | (53563) |
|  Available-for-sale financial assets |  | (146364) | 51 |  | (146415) | 164 |
|  Write-off |  | 1616032 | 29179 | 110585 | 1697438 | 448124 |
|  Provisions |  | 995687 | 1502388 | 1005186 | 498485 | 131600 |
|  Property impairment losses |  | 6111 | 173 |  | 5938 | 1568 |
|  Dividends Receivable |  | 17397 |  | 77 | 17474 | 4613 |
|  Loan origination fees |  | (21697) | (21697) | (32138) | (32138) | (8484) |
|  Gains on sales of loans |  | (2541608) | (13623) |  | (2527985) | (667388) |
|  Others |  | (1235725) | 876497 | 331742 | (1780480) | (520634) |
|  |  | (10311058) | 1451234 | (1053363) | (12815655) | (3978164) |
|  Temporary differences from unrecognized deferred tax assets and liabilities: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investments in subsidiaries and associates, etc. |  | 2512727 | (259579) |  | 2253148 |  |
|  | W | (12823785) |  |  | (15068803) | (3978164) |
|  Unused tax loss | W | 591011 | 591011 |  |  |  |

---

(\*) Temporary differences as of January 1, 2023 reflected previous year's additional tax adjustment after the financial statements were issued.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**36. <u>Income Tax Expense, Continued</u>**

(4) Changes in income tax expense recognized directly to equity for the years ended December 31, 2024 and 2023
are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **January 1, 2024** | **January 1, 2024** | **Changes in**<br>**tax effect** |
|  | **Amounts<br>before tax** | **Amounts<br>before tax** | **Tax effect** | **Amounts<br>before tax** | **Tax effect** | **Changes in**<br>**tax effect** |
|  Net gain on securities measured at FVOCI | W | 906757 | (325250) | 1927765 | (691480) | 366230 |
|  Exchange differences on translation of foreign operations |  | 408725 |  | 152225 |  |  |
|  Net gain on valuation of cash flow hedge |  | 769 | (276) | 2969 | (1065) | 789 |
|  Net loss on hedges of net investments in foreign operations |  | (209021) | 74976 | (86315) | 30961 | 44015 |
|  Remeasurements of defined benefit liabilities |  | 71636 | (25694) | 88732 | (31826) | 6132 |
|  Fair value changes on financial liabilities designated at fair value due to credit risk |  | 57859 | (20756) | 72975 | (26178) | 5422 |
|  | W | 1236725 | (297000) | 2158351 | (719588) | 422588 |

---

Income tax benefit recognized direct to retained earnings amounting to W325,934 million is the tax effect of realized income amounting to W1,234,598 million from disposal of equity securities measured at FVOCI.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **January 1, 2023** | **January 1, 2023** | **Changes in**<br>**tax effect** |
|  | **Amounts<br>before tax** | **Amounts<br>before tax** | **Tax effect** | **Amounts<br>before tax** | **Tax effect** | **Changes in**<br>**tax effect** |
|  Net gain on securities measured at FVOCI | W | 1927765 | (691480) | 2557521 | (922099) | 230619 |
|  Exchange differences on translation of foreign operations |  | 152225 |  | 132126 |  |  |
|  Net gain on valuation of cash flow hedge |  | 2969 | (1065) | 5322 | (1919) | 854 |
|  Net loss on hedges of net investments in foreign operations |  | (86315) | 30961 | (71202) | 25672 | 5289 |
|  Remeasurements of defined benefit liabilities |  | 88732 | (31826) | 104870 | (37808) | 5982 |
|  Fair value changes on financial liabilities designated at fair value due to credit risk |  | 72975 | (26178) | 90696 | (32702) | 6524 |
|  | W | 2158351 | (719588) | 2819333 | (968856) | 249268 |

---

Income tax benefit recognized direct to retained earnings amounting to W284,235 million is the tax effect of realized income amounting to W1,076,647 million from disposal of equity securities measured at FVOCI.

***(5) Global Minimum Corporate Tax Act***

The Bank applies the temporary exception under Korean IFRS No. 1012 Income Taxes and does not recognize deferred tax assets or liabilities related to the Pillar 2 legislation, nor does it disclose information related to deferred taxes.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**36. <u>Income Tax Expense, Continued</u>**

Under the legislation, the parent company is required to pay, in Republic of Korea, top-up tax on profits of its subsidiaries that are taxed at an effective tax rate of less than 15 percent. However, since most jurisdictions either qualify for the transitional relief provisions or already have an effective tax rate of 15% or higher, it is anticipated that no significant additional taxes will arise. As a result, the Bank has not recognized any amount related to the Global Minimum Corporate Tax Act in its current period income tax expense. The estimated annual effective tax rate is subject to change due to various factors, including tax incentives received by subsidiaries and adjustments to accounting profit or loss for the calculation of GloBE income as required under applicable laws in subsequent periods. Accordingly, the current tax expense related to Pillar 2 is exposed to estimation uncertainty.

**37. <u>Earnings per Share</u>** 

***(1) Basic earnings per share***

The Bank's basic earnings per share for the years ended December 31, 2024 and 2023 are computed as follows:

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Basic earnings per share***

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
|  Profit attributable to ordinary shareholders of the Bank (A) (in won) | W | 2007158097051 |  | 3027068710870 |
|  Weighted-average number of ordinary shares outstanding (B) |  | 5129882260 |  | 4720569302 |
|  Basic earnings per share (A/B) (in won) | W | 391 |  | 641 |

---

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Weighted-average number of ordinary shares outstanding***

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** |
|  | **Number of<br>ordinary shares** | **Days** | **Cumulative shares** |
|  Number of ordinary shares outstanding at the beginning of the year (A) | 4785311768 | 366 | 1751424107088 |
|  Increased paid-in capital (B) | 400000000 | 278 | 111200000000 |
|  Increased paid-in capital (C) | 16800000 | 246 | 4132800000 |
|  Increased paid-in capital (D) | 24200000 | 210 | 5082000000 |
|  Increased paid-in capital (E) | 37000000 | 154 | 5698000000 |
|  Cumulative shares (F = A+B+C+D+E) |  |  | 1877536907088 |
|  Weighted-average number of ordinary shares outstanding (F/366) |  |  | 5129882260 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**37. <u>Earnings per Share, Continued</u>**

---

| | | | |
|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** |
|  | **Number of<br>ordinary shares** | **Days** | **Cumulative shares** |
|  Number of ordinary shares outstanding at the beginning of the year (A) | 4630311768 | 365 | 1690063795320 |
|  Increased paid-in capital (B) | 87000000 | 276 | 24012000000 |
|  Increased paid-in capital (C) | 24000000 | 220 | 5280000000 |
|  Increased paid-in capital (D) | 44000000 | 83 | 3652000000 |
|  Cumulative shares (E = A+B+C+D) |  |  | 1723007795320 |
|  Weighted-average number of ordinary shares outstanding (E/365) |  |  | 4720569302 |

---

***(2) Diluted earnings per share***

Diluted and basic earnings per share for the years ended December 31, 2024 and 2023 are equal because there is no potential dilutive instrument.

**38. <u>Pledged Assets</u>** 

Assets pledged by the Bank as collateral as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  | **Pledged assets** | **Pledged assets** | **Related liabilities** | **Pledged assets** | **Related liabilities** |
|  Securities measured at FVOCI (\*) | W | 1726575 | 377632 | 3264199 | 448961 |
|  Securities measured at amortized cost (\*) |  | 3382755 |  | 15413180 |  |
|  | W | 5109330 | 377632 | 18677379 | 448961 |

---

(\*) Pledged as collateral related to bonds sold under repurchase agreements and borrowings.

**39. <u>Guarantees and Commitments</u>** 

Guarantees and commitments as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Confirmed acceptances and guarantees: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Acceptances in foreign currency | W | 208758 | 179849 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantees for bond issuance |  | 2751485 | 2347527 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantees for loans |  | 468067 | 537699 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Letter of guarantee |  | 42741 | 35858 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Guarantees for on-lending debt |  | 1440 | 2821 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 8882851 | 7700977 |
|  |  | 12355342 | 10804731 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**39. <u>Guarantees and Commitments, Continued</u>**

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Unconfirmed acceptances and guarantees: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Letter of credit |  | 2010549 | 2219357 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 4976884 | 5340302 |
|  |  | 6987433 | 7559659 |
|  Commitments: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Commitments on loans |  | 56312320 | 54816638 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others |  | 11377587 | 2046383 |
|  |  | 67689907 | 56863021 |
|  | W | 87032682 | 75227411 |

---

**40. <u>Trust Accounts</u>** 

(1) Trust accounts as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** | **December 31,<br>2023** |
|  Accrued trust fee | W | 10540 |  | 16123 |
|  Borrowings from trust accounts |  | 913507 |  | 881342 |
|  Accrued interest on deposits |  | 3269 |  | 2257 |

---

(2) Transactions with trust accounts for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
|  Fees on trust accounts | W | 36655 |  | 35770 |
|  Interest expenses of borrowings from trust accounts |  | 54845 |  | 54577 |

---

(3) The carrying amounts of principals guaranteed money trust and principals and interest guaranteed money trust as
of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** | **December 31,<br>2023** |
|  Principals guaranteed money trust | W | 209962 |  | 219950 |
|  Principals and interest guaranteed money trust |  | 208636 |  | 219081 |
|  | W | 418598 |  | 439031 |
|  Principal of money and property trust | W | 377327 |  | 400818 |
|  Accrued trust profit |  | 41271 |  | 38213 |

---

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**41. <u>Related Party Transactions</u>** 

(1) The Bank's related parties as of December 31, 2024 are as follows:

---

| | |
|:---|:---|
| **Classification** | **Corporate name** |
|  Subsidiaries | KDB Capital Corporation, KDB Infrastructure Investment Asset Management Co., Ltd., KDB Asia Ltd., KDB Ireland Ltd., KDB Bank Europe Ltd., Banco KDB Do Brazil S.A., KDB Bank Uzbekistan, PT KDB Tifa Finance Tbk and 6 others, KDB Investment PEF No. 2, KDB Consus Value PEF, KDB Small Medium Mezzanine PEF and 7 others, Principals guaranteed trust accounts of KDB, Principals and interests guaranteed interest trust accounts of KDB, KDB ESG 7th INC. and 12 others, KIAMCO Road Investment Private Fund Special Asset Trust 2 and 21 others |
|  Associates | Korea Electric Power Co., Ltd., Korea Tourism Organization, Korea Real Estate Board, GM Korea Company, HMM Co., Ltd., HANJIN KAL, Korean Air Lines Co., Ltd., Hanwha Ocean Co., Ltd., Korea Ocean Business Corporation, TAEYOUNG ENGINEERING & CONSTRUCTION and 16 others, Keistone Value Investment 2nd Private Equity Fund and 99 others, Hana K-New Deal Unicorn Fund and 117 others |
|  Others | Key management personnel |

---

(2) Significant balances with related parties as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Account** | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Subsidiaries: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Capital Corporation | Loans | W | 188 | 876 |
|  | Allowance for loan losses |  |  | (1) |
|  | Derivative financial assets |  | 1904 | 1331 |
|  | Other assets |  |  | 1 |
|  | Deposits |  | 28 | 39 |
|  | Derivative financial liabilities |  |  | 791 |
|  | Other liabilities |  | 37040 | 37212 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Infrastructure Investment Asset Management Co., Ltd. | Deposits |  | 45749 | 14847 |
|  | Other liabilities |  | 329 | 118 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Ireland Ltd. | Loans |  | 1052396 | 853433 |
|  | Allowance for loan losses |  | (548) | (416) |
|  | Derivative financial assets |  | 858 | 2461 |
|  | Other assets |  | 7881 | 7873 |
|  | Derivative financial liabilities |  | 14535 | 15377 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**41. <u>Related Party Transactions, Continued</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Account** | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Bank Europe Ltd. | Cash and due from banks |  | 715339 | 578908 |
|  | Loans |  | 76437 | 84224 |
|  | Allowance for loan losses |  | (40) | (41) |
|  | Other assets |  | 5313 | 4726 |
|  | Derivative financial liabilities |  | 174 | 313 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banco KDB Do Brazil S.A. | Cash and due from banks |  | 191100 | 104441 |
|  | Loans |  | 374850 | 321061 |
|  | Allowance for loan losses |  | (227) | (156) |
|  | Other assets |  | 10260 | 8415 |
|  | Allowance of other assets |  | (4) | (4) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; PT KDB Tifa Finance Tbk | Loans |  | 29400 | 25788 |
|  | Allowance for loan losses |  | (15) | (13) |
|  | Other assets |  | 122 | 134 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Silicon Valley LLC | Deposits |  | 85260 | 91547 |
|  | Other liabilities |  | 668 | 185 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Asia Ltd. | Cash and due from banks |  | 1279558 | 1291474 |
|  | Loans |  | 73500 | 128940 |
|  | Allowance for loan losses |  | (39) | (63) |
|  | Derivative financial assets |  |  | 98 |
|  | Other assets |  | 9055 | 10313 |
|  | Allowance of other assets |  | (1) | (1) |
|  | Deposits |  | 2 | 2 |
|  | Derivative financial liabilities |  | 4089 | 5002 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Bank Uzbekistan | Cash and due from banks | W | 176400 | 128940 |
|  | Loans |  | 147000 |  |
|  | Allowance for loan losses |  | (77) |  |
|  | Other assets |  | 2690 | 429 |
|  | Allowance of other assets |  | (1) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Consus Value PEF | Securities |  | 265501 | 274423 |
|  | Allowance of securities |  | (25) | (23) |
|  | Derivative financial assets |  | 95933 | 2899 |
|  | Other assets |  | 22728 | 25516 |
|  | Deposits |  | 26 | 69 |
|  | Derivative financial liabilities |  |  | 6234 |
|  | Other liabilities |  | 42303 | 47386 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate Liquidity Assistance Agency Co., Ltd. | Loans |  |  | 440000 |
|  | Allowance for loan losses |  |  | (238) |
|  | Other assets |  |  | 64756 |
|  | Allowance of other assets |  |  | (35) |
|  | Deposits |  | 1077427 | 107763 |
|  | Other liabilities |  | 359 | 137 |
|  | Other provisions |  | 242 | 224 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**41. <u>Related Party Transactions, Continued</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Account** | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | Loans |  | 428846 | 431960 |
|  | Allowance for loan losses |  | (69899) | (62201) |
|  | Derivative financial assets |  | 2257 | 7722 |
|  | Other assets |  | 2396 | 3019 |
|  | Allowance of other assets |  | (4) | (9) |
|  | Deposits |  | 105742 | 128073 |
|  | Borrowings |  | 59997 | 80076 |
|  | Derivative financial liabilities |  |  | 314 |
|  | Other liabilities |  | 1349 | 2359 |
|  | Other provisions |  | 4467 | 17929 |
|  Associates: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Electric Power Co., Ltd. | Securities |  | 192138 | 168701 |
|  | Loans |  | 335939 | 328097 |
|  | Allowances for loan losses |  | (903) | (1082) |
|  | Derivative financial assets |  | 2350 | 84826 |
|  | Other assets |  | 5152 | 5783 |
|  | Deposits |  | 116622 | 371020 |
|  | Borrowings |  | 1454 | 1801 |
|  | Derivative financial liabilities |  | 650949 | 160304 |
|  | Other liabilities |  | 51157 | 46449 |
|  | Other provisions |  | 157 | 85 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HMM Co., Ltd. | Securities | W | 1269495 | 3286533 |
|  | Loans |  | 84977 | 123682 |
|  | Allowances for loan losses |  | (572) | (775) |
|  | Other assets |  | 2272 | 4280 |
|  | Deposits |  | 883000 | 258880 |
|  | Other liabilities |  | 30038 | 17292 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HANJIN KAL | Loans |  | 428891 | 447774 |
|  | Allowances for loan losses |  | (2636) | (3142) |
|  | Other assets |  | 529 | 526 |
|  | Deposits |  | 2000 | 2000 |
|  | Other liabilities |  | 344 | 333 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korean Air Lines Co., Ltd. | Securities |  |  | 64154 |
|  | Loans |  | 2425714 | 1482916 |
|  | Allowances for loan losses |  | (27726) | (4831) |
|  | Derivative financial assets |  | 10235 | 8790 |
|  | Other assets |  | 8880 | 13743 |
|  | Deposits |  | 2106944 | 1605661 |
|  | Derivative financial liabilities |  | 154167 | 81256 |
|  | Other liabilities |  | 67252 | 47542 |
|  | Other provisions |  | 5493 | 561 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**41. <u>Related Party Transactions, Continued</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Account** | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Ocean Business Corporation | Securities |  | 62304 | 55020 |
|  | Other assets |  | 481 | 401 |
|  | Deposits |  |  | 25000 |
|  | Other liabilities |  | 203 | 713 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hanwha Ocean Co., Ltd. | Securities |  | 64 | 64 |
|  | Loans |  | 2838142 | 1468780 |
|  | Allowances for loan losses |  | (90160) | (146570) |
|  | Derivative financial assets |  | 339872 | 328988 |
|  | Other assets |  | 9141 | 8443 |
|  | Deposits |  | 9807 | 156336 |
|  | Borrowings |  | 5136 |  |
|  | Other liabilities |  | 13865 | 11968 |
|  | Other provisions |  | 138484 | 417443 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; TAEYOUNG ENGINEERING & CONSTRUCTION | Loans |  | 179000 |  |
|  | Allowances for loan losses |  | (17856) |  |
|  | Deposits |  | 57505 |  |
|  | Other liabilities |  | 728 |  |
|  | Other provisions |  | 40336 |  |
|  Associates: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | Securities | W | 17353 | 26345 |
|  | Loans |  | 418933 | 218912 |
|  | Allowances for loan losses |  | (18853) | (546) |
|  | Derivative financial assets |  | 8677 | 19 |
|  | Other assets |  | 8138 | 8068 |
|  | Deposits |  | 478254 | 397953 |
|  | Derivative financial liabilities |  |  | 1174 |
|  | Other liabilities |  | 3196 | 2671 |
|  | Other provisions |  | 40441 | 46 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**41. <u>Related Party Transactions, Continued</u>**

(3) Significant profit or loss with related parties for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Account** | **2024** | **2024** | **2023** |
|  Subsidiaries: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Capital Corporation | Interest income | W | 49 | 277 |
|  | Dividend income |  | 31435 | 21060 |
|  | Reversal of allowance for loan losses |  | 1 | 1 |
|  | Fees and commission income, other income |  | 10829 | 2255 |
|  | Interest expenses |  | (2511) | (1795) |
|  | Other operating expenses |  | (1358) | (886) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Infrastructure Investments Asset Management Co., Ltd. | Dividend income |  | 13886 | 13634 |
|  | Interest expenses |  | (1044) | (463) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Ireland Ltd. | Interest income |  | 50169 | 42763 |
|  | Fees and commission income, other income |  | 9801 | 10909 |
|  | Interest expenses |  | (14) | (43) |
|  | Provision for loan losses |  | (78) | (167) |
|  | Other operating expenses |  | (21716) | (12778) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Bank Europe Ltd. | Interest income |  | 35959 | 24340 |
|  | Reversal of allowance for loan losses |  | 4 |  |
|  | Fees and commission income, other income |  | 164 | 1118 |
|  | Provision for loan losses |  |  | (27) |
|  | Other operating expenses |  | (203) | (1609) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banco KDB Do Brazil S.A. | Interest income |  | 25057 | 20548 |
|  | Provision for loan losses |  | (44) | (79) |
|  | Other operating expenses |  | (4) | (4) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; PT KDB Tifa Finance Tbk | Interest income |  | 1621 | 1497 |
|  | Provision for loan losses |  | (1) | (5) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Silicon Valley LLC | Fees and commission income, other income | W |  | 4 |
|  | Interest expenses |  | (4411) | (5271) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Asia Ltd. | Interest income |  | 83117 | 84207 |
|  | Reversal of allowance for loan losses |  | 33 | 11 |
|  | Fees and commission income, other income |  | 1941 | 3174 |
|  | Interest expenses |  | (196) | (483) |
|  | Other operating expenses |  | (3374) | (4964) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Bank Uzbekistan | Interest income |  | 11140 | 4028 |
|  | Fees and commission income, other income |  |  | 153 |
|  | Provision for loan losses |  | (77) |  |
|  | Other operating expenses |  | (1) |  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**41. <u>Related Party Transactions, Continued</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Account** | **2024** | **2024** | **2023** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Consus Value PEF | Interest income | W | 20054 | 11852 |
|  | Fees and commission income, other income |  | 126080 | 15749 |
|  | Interest expenses |  | (25) | (21) |
|  | Other operating expenses |  | (837) | (6165) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate Liquidity Assistance Agency Co., Ltd. | Interest income |  | 11420 | 20212 |
|  | Fees and commission income, other income |  | 273 |  |
|  | Interest expenses |  | (15373) | (3567) |
|  | Provision for loan losses |  |  | (86) |
|  | Other operating expenses |  | (18) | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | Interest income |  | 19626 | 22478 |
|  | Dividend income |  | 122373 | 56040 |
|  | Reversal of allowance for loan losses |  | 834 | 44599 |
|  | Fees and commission income, other income |  | 40590 | 21219 |
|  | Interest expenses |  | (3720) | (4703) |
|  | Provision for loan losses |  | (22) | (55623) |
|  | Other operating expenses |  | (7444) | (19352) |
|  Associates: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Electric Power Co., Ltd. | Interest income |  | 25125 | 24512 |
|  | Reversal of allowance for loan losses |  | 179 |  |
|  | Fees and commission income, other income |  | 77973 | 121605 |
|  | Interest expenses |  | (9786) | (11360) |
|  | Provision for loan losses |  |  | (1082) |
|  | Other operating expenses |  | (682464) | (221506) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HMM Co., Ltd. | Interest income | W | 22084 | 38998 |
|  | Dividend income |  | 140840 | 121439 |
|  | Reversal of allowance for loan losses |  | 203 |  |
|  | Fees and commission income, other income |  | 3274 | 1916 |
|  | Interest expenses |  | (16846) | (44123) |
|  | Provision for loan losses |  |  | (775) |
|  | Other operating expenses |  | (89348) | (69013) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; HANJIN KAL | Interest income |  | 11626 | 11735 |
|  | Dividend income |  | 2119 | 1201 |
|  | Reversal of allowance for loan losses |  | 507 |  |
|  | Fees and commission income, other income |  | 30 | 30 |
|  | Interest expenses |  | (109) | (841) |
|  | Provision for loan losses |  |  | (3142) |
|  | Other operating expenses |  | (18883) | (5671) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**41. <u>Related Party Transactions, Continued</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Account** | **2024** | **2024** | **2023** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korean Air Lines Co., Ltd. | Interest income | W | 198210 | 72984 |
|  | Dividend income |  | 9180 | 9180 |
|  | Reversal of allowance for loan losses |  | 6508 |  |
|  | Fees and commission income, other income |  | 104844 | 89082 |
|  | Interest expenses |  | (105080) | (66766) |
|  | Provision for loan losses |  |  | (4831) |
|  | Other operating expenses |  | (308689) | (119041) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Ocean Business Corporation | Interest income |  | 3166 | 1695 |
|  | Fees and commission income, other income |  | 464 | 2 |
|  | Interest expenses |  | (222) | (524) |
|  | Other operating expenses |  | (1016) | (1086) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hanwha Ocean Co., Ltd. | Interest income |  | 100644 | 117836 |
|  | Reversal of allowance for loan losses |  | 56410 |  |
|  | Fees and commission income, other income |  | 868116 | 462472 |
|  | Interest expenses |  | (9322) | (6391) |
|  | Provision for loan losses |  |  | (146570) |
|  | Other operating expenses |  | (77827) | (481806) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; TAEYOUNG ENGINEERING & CONSTRUCTION | Interest income |  | 10320 |  |
|  | Reversal of allowance for loan losses |  | 98818 |  |
|  | Interest expenses |  | (374) |  |
|  | Other operating expenses |  | (40337) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | Interest income | W | 18285 | 8983 |
|  | Dividend income |  | 290838 | 260290 |
|  | Reversal of allowance for loan losses |  | 116677 |  |
|  | Fees and commission income, other income |  | 21422 | 7315 |
|  | Interest expenses |  | (8787) | (8135) |
|  | Provision for loan losses |  | (18351) | (546) |
|  | Other operating expenses |  | (48701) | (2465) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**41. <u>Related Party Transactions, Continued</u>**

(4) Details of guarantees and commitments to the related parties as of December 31, 2024 and 2023 are as
follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Account** | **December 31,<br>2024** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Subsidiaries: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Capital Corporation | Commitments | W | 500000 | 500000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; KDB Consus Value PEF | Confirmed acceptances and guarantees |  | 132840 | 132840 |
|  | Commitments |  | 11519 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate Liquidity Assistance Agency Co., Ltd. | Commitments |  | 560000 | 560000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | Unconfirmed acceptances and guarantees |  |  | 885 |
|  | Commitments |  | 1054869 | 1059271 |
|  Associates: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korean Air Lines Co., Ltd. | Confirmed acceptances and guarantees |  | 227666 | 172957 |
|  | Commitments |  | 454224 | 30000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hanwha Ocean Co., Ltd. | Confirmed acceptances and guarantees |  | 3729088 | 3529955 |
|  | Unconfirmed acceptances and guarantees |  | 2583277 | 2150165 |
|  | Commitments |  | 1779609 | 1836929 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | Commitments |  | 403113 | 377891 |
|  |  | W | 11436205 | 10350893 |

---

(5) Details of compensation to key management personnel for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
|  Short-term employee benefits | W | 1084 |  | 957 |
|  Post-employment benefits |  | 52 |  | 41 |
|  | W | 1136 |  | 998 |

---

(6) The Bank are not pledged any assets as collaterals to the related parties and from the related parties as of
December 31, 2024 and 2023.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**42. <u>Statements of Cash Flows</u>** 

(1) Cash and cash equivalents in the statements of cash flows as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Cash and due from banks: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and foreign currencies | W | 67357 | 65738 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Due from banks in Korean won |  | 1553014 | 2017973 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Due from banks in foreign currencies / off-shores |  | 11375150 | 6576097 |
|  |  | 12995521 | 8659808 |
|  Less: Restricted due from banks, others |  | (3361559) | (2464287) |
|  Add: Financial instruments reaching maturity within three months from date of acquisition |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government and public bonds |  |  | 162256 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Call-loans |  | 2802236 | 4456954 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inter-bank loans |  | 1438815 | 1045846 |
|  |  | 4241051 | 5502800 |
|  |  | 4241051 | 5665056 |
|  | W | 13875013 | 11860577 |

---

(2) Significant transactions not involving cash flows for the years ended December 31, 2024 and 2023 are as
follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Decrease in loans due to write-offs | W | 24526 | 203807 |
|  Increase in securities measured at FVOCI due to debt-to-equity swap, etc |  | 41566 | 34030 |
|  Increase in investments in subsidiaries and associates due to debt-to-equity swap |  | 54719 |  |
|  Increase (decrease) in accumulated other comprehensive income due to securities valuation |  | (1387238) | (860375) |
|  Deferred income tax effect due to securities valuation |  | 366230 | 230619 |
|  Reclassification of investments in subsidiaries and associates to securities measured at FVTPL |  |  | 4800 |
|  Reclassification from securities measured at FVOCI to investments in subsidiaries and associates |  | 1696500 | 1497000 |
|  Transfer from investment property to property and equipment |  | 8956 | 5618 |
|  Recognition of right-of-use assets and lease liabilities |  | 28917 | 40130 |
|  In-kind equity |  | 1999780 | 432137 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**43. <u>Transfers of Financial Instruments</u>** 

Details of financial assets and liabilities related to repurchase agreements and loaned securities sold and loaned debt securities that do not qualify for derecognition as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
| <br>Characteristics of transactions | **Carrying<br>amounts for<br>transferred<br>assets** | **Carrying<br>amounts for<br>transferred<br>assets** | **Carrying<br>amounts for<br>related<br>liabilities** | **Carrying<br>amounts for<br>transferred<br>assets** | **Carrying<br>amounts for<br>related<br>liabilities** |
|  Repurchase agreements | W | 520000 | 47181 | 1447767 | 30095 |
|  Loaned securities |  | 40409 |  | 39341 |  |
|  | W | 560409 | 47181 | 1487108 | 30095 |

---

**44. <u>Fair Value of Financial Assets and Liabilities</u>** 

The Bank classifies and discloses fair value of the financial instruments into the following three-level hierarchy:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1: Financial instruments measured at quoted prices from active markets are classified as level 1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2: Financial instruments measured using valuation techniques where all significant inputs are
observable market data are classified as level 2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3: Financial instruments measured using valuation techniques where one or more significant inputs are
not based on observable market data are classified as level 3.

***(1) Fair value hierarchy of financial instruments measured at fair value***

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The fair value hierarchy of financial instruments measured at fair value as of December 31, 2024 and 2023
are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Level 1** | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Financial assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL | W | 2804662 | 1391702 | 14222436 | 18418800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 1594047 | 16759867 | 14406279 | 32760193 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL |  |  |  | 419773 | 419773 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets |  |  | 13914992 | 259 | 13915251 |
|  | W | 4398709 | 32066561 | 29048747 | 65514017 |
|  Financial liabilities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL | W |  | 2389246 |  | 2389246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities |  |  | 14853546 | 20393 | 14873939 |
|  | W |  | 17242792 | 20393 | 17263185 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**44. <u>Fair Value of Financial Assets and Liabilities, Continued</u>**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Level 1** | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Financial assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL | W | 1784605 | 1567893 | 12706058 | 16058556 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 2397136 | 16646131 | 14844797 | 33888064 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL |  |  |  | 488432 | 488432 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets |  |  | 7383047 | 278 | 7383325 |
|  | W | 4181741 | 25597071 | 28039565 | 57818377 |
|  Financial liabilities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL | W |  | 1920061 |  | 1920061 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities |  | 32 | 7631930 | 22939 | 7654901 |
|  | W | 32 | 9551991 | 22939 | 9574962 |

---

(ii) Changes in the fair value of level 3 financial instruments for the years ended December 31, 2024 and 2023
are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **Financial assets** | **Financial assets** | **Financial assets** | **Financial assets** | **Financial assets** | **Financial assets** | **Financial<br>liabilities** |
|  | **Securities<br>measured at<br>FVTPL** | **Securities<br>measured at<br>FVTPL** | **Securities<br>measured at<br>FVOCI** | **Loans<br>measured at<br>FVTPL** | **Derivative<br>financial<br>assets** | **Total** | **Derivative<br>financial<br>liabilities** |
|  January 1, 2024 | W | 12706058 | 14844797 | 488432 | 278 | 28039565 | 22939 |
|  Profit or loss |  | 1016696 |  | (24106) | (19) | 992571 | (2546) |
|  Other comprehensive income |  |  | (37552) |  |  | (37552) |  |
|  Acquisition / Issue |  | 892251 | 2307497 | 7000 |  | 3206748 |  |
|  Sale / Settlement |  | (388799) | (100283) | (52149) |  | (541231) |  |
|  Transfer out(\*) |  | (3770) | (2608180) |  |  | (2611950) |  |
|  Others |  |  |  | 596 |  | 596 |  |
|  December 31, 2024 | W | 14222436 | 14406279 | 419773 | 259 | 29048747 | 20393 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**44. <u>Fair Value of Financial Assets and Liabilities, Continued</u>**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **Financial assets** | **Financial assets** | **Financial assets** | **Financial assets** | **Financial assets** | **Financial assets** | **Financial<br>liabilities** |
|  | **Securities<br>measured at<br>FVTPL** | **Securities<br>measured at<br>FVTPL** | **Securities<br>measured at<br>FVOCI** | **Loans<br>measured at<br>FVTPL** | **Derivative<br>financial<br>assets** | **Total** | **Derivative<br>financial<br>liabilities** |
|  January 1, 2023 | W | 10610539 | 16224072 | 541811 | 12762 | 27389184 | 40359 |
|  Profit or loss |  | 317948 |  | (8913) | 241 | 309276 | (11455) |
|  Other comprehensive income |  |  | (1305498) |  |  | (1305498) |  |
|  Acquisition / Issue |  | 2404013 | 831851 | 6804 |  | 3242668 |  |
|  Sale / Settlement |  | (626442) | (684083) | (51270) | (12725) | (1374520) | (5965) |
|  Transfer out(\*) |  |  | (221545) |  |  | (221545) |  |
|  December 31, 2023 | W | 12706058 | 14844797 | 488432 | 278 | 28039565 | 22939 |

---

(\*) When significant inputs become observable market data, the financial instruments are transferred to (from) other levels.

(iii) Changes in deferred day one profit or loss for the years ended December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** |
|  Beginning balance | W | 3219 | 3604 |
|  Amortization |  | (390) | (385) |
|  Ending balance | W | 2829 | 3219 |

---

(iv) Details of valuation technique and inputs used in the fair value measurement categorized within level 2 of the
fair value hierarchy of financial instruments measured at fair value as of December 31, 2024 and 2023 are as follows:

---

| | | |
|:---|:---|:---|
|  | **Valuation technique** | **Input** |
|  Securities measured at FVTPL |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity securities | Net asset value approach | Underlying asset price |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt securities | Discounted cash flow method | Discount rate |
|  Securities measured at FVOCI |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity securities | Net asset value approach | Underlying asset price |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt securities | Discounted cash flow method | Discount rate |
|  Derivatives financial assets |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate swaps | Discounted cash flow method, Black-Scholes model, Modified Black model, Formula model | Discount rate, exchange rate, volatility, commodity index, etc. |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency forwards and swaps | Discounted cash flow method, Black-Scholes model, Modified Black model, Formula model | Discount rate, exchange rate, volatility, commodity index, etc. |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency options | Discounted cash flow method, Black-Scholes model, Modified Black model, Formula model |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Commodities options |  |  |
|  Financial liabilities measured at FVTPL |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | Discounted cash flow method | Discount rate |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**44. <u>Fair Value of Financial Assets and Liabilities, Continued</u>**

(v) Details of valuation technique and quantitative information about unobservable inputs used in the fair value
measurement categorized within level 3 of the fair value hierarchy of financial instruments measured at fair value as of December 31, 2024 and 2023 are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Valuation technique** | **Unobservable input** | **Range (%)** |
|  Securities measured at FVTPL |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity securities | Discounted cash flow | Discount rate | 4.87 ~ 10.32 |
|  | method, Relative value | Rate of increase in |  |
|  | approach, Net asset | property disposal price |  |
|  | value approach, etc. | Rate of increase in |  |
|  |  | liquidation value |  |
|  |  | Volatility | 18.36 ~ 56.61 |
|  Securities measured at FVOCI |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity securities | Discounted cash flow | Growth rate |  |
|  | method, Relative value | Discount rate | 6.01 ~ 16.03 |
|  | approach, Net asset | Volatility | 29.90 ~ 32.22 |
|  | value approach, etc. | Interest rate volatility | 0.47 ~ 0.73 |
|  Loans measured at FVTPL |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Convertible bonds, etc. | LSMC, Binomial model | Volatility | 18.76 ~ 35.92 |
|  Derivatives financial assets |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate swaps | Hull-White | Volatility | 0.68 ~ 0.85 |
|  | Two-Factor model | Correlation coefficient | (70) ~ 100 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock index options | Discounted cash flow | Volatility | 25.71 ~ 26.97 |
|  | method, Relative value |  |  |
|  | approach, Net asset |  |  |
|  | value approach, |  |  |
|  | Binomial Tree(T-F) |  |  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**44. <u>Fair Value of Financial Assets and Liabilities, Continued</u>**

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Valuation technique** | **Unobservable input** | **Range (%)** |
|  Securities measured at FVTPL |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity securities | Discounted cash flow | Discount rate | 7.04 ~ 17.73 |
|  | method, Relative | Rate of increase in |  |
|  | value approach, Net | property disposal price |  |
|  | asset value approach, etc. | Rate of increase in liquidation value |  |
|  |  | Volatility | 19.68 ~ 76.22 |
|  Securities measured at FVOCI |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Equity securities | Discounted cash flow | Growth rate |  |
|  | method, Relative value | Discount rate | 9.25 ~ 20.40 |
|  | approach, Net asset | Volatility | 16.68 ~ 76.22 |
|  | value approach, etc. | Interest rate volatility | 0.51 ~ 0.86 |
|  Loans measured at FVTPL |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Convertible bonds, etc. | LSMC, Binomial model | Volatility | 16.68 ~ 76.22 |
|  Derivatives financial assets Interest rate swaps | Hull-White | Volatility | 0.51 ~ 1.06 |
|  | Two-Factor model | Correlation coefficient | (70) ~ 100 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock index options | Discounted cash flow | Volatility | 19.59 ~ 25.45 |
|  | method, Relative value |  |  |
|  | approach, Net asset |  |  |
|  | value approach, |  |  |
|  | Binomial Tree(T-F) |  |  |

---

(vi) The sensitivity analysis on changes in unobservable inputs for financial instruments categorized within level 3
of the fair value hierarchy of financial instruments measured at fair value as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Profit (loss) for the year** | **Profit (loss) for the year** | **Profit (loss) for the year** | **Other comprehensive income (loss)** | **Other comprehensive income (loss)** |
|  | **Favorable<br>change** | **Favorable<br>change** | **Unfavorable<br>change** | **Favorable**<br>**change** | **Unfavorable<br>change** |
|  Securities measured at FVTPL (\*1) | W | 79721 | (168828) |  |  |
|  Securities measured at FVOCI (\*1) |  |  |  | 94580 | (71808) |
|  Loans measured at FVTPL (\*2) |  | 3876 | (3662) |  |  |
|  Derivative financial assets (\*2) |  | 252 | (239) |  |  |
|  | W | 83849 | (172729) | 94580 | (71808) |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**44. <u>Fair Value of Financial Assets and Liabilities, Continued</u>**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Profit (loss) for the year** | **Profit (loss) for the year** | **Profit (loss) for the year** | **Other comprehensive income (loss)** | **Other comprehensive income (loss)** |
|  | **Favorable<br>change** | **Favorable<br>change** | **Unfavorable<br>change** | **Favorable**<br>**change** | **Unfavorable<br>change** |
|  Securities measured at FVTPL (\*1) | W | (1876) | (2487) |  |  |
|  Securities measured at FVOCI (\*1) |  |  |  | 26489 | (23913) |
|  Loans measured at FVTPL (\*2) |  | 6170 | (5936) |  |  |
|  Derivative financial assets (\*2) |  | 264 | (247) |  |  |
|  | W | 4558 | (8670) | 26489 | (23913) |

---

---

| | |
|:---|:---|
| (\*1) | Sensitivity amounts of equity securities are calculated by increasing and decreasing the correlations between the discount rates and the growth rates (0~1%) or the rate of increase in liquidation value (-1~1%) which are significant unobservable inputs. Sensitivity amounts for beneficiary certificates are calculated by increasing and decreasing the correlations between the discount rate of rent cash flow (-1~1%) and the rate of increase in property disposal price (-1~1%), only when they consist of real properties. Other than that, it is difficult to measure the sensitivity amounts of beneficiary certificates for practical reasons. Also, for financial instruments categorized within level 3 in 2024 and 2023, W24,518,096 million and W18,704,023 million, respectively, are excluded from the sensitivity disclosure because it is impossible to calculate the sensitivity due to changes in unobservable variables for practical reasons.  |

---

---

| | |
|:---|:---|
| (\*2) | Sensitivity amounts of loans measured at FVTPL and derivatives financial instruments are calculated by increasing and decreasing the correlation coefficient and volatility (-10~10%) which are significant unobservable inputs.  |

---

(2) Fair value hierarchy of financial instruments measured at amortized cost

(i) The Bank's policies for measuring fair value of financial instruments at amortized costs are as follows:

Cash and due from banks: Fair value of cash is considered equivalent to the carrying amount. In the case of due from banks on demand, which do not have a set maturity and can be realized instantly, the carrying amount is a close estimate of the fair value and is assumed so. In the case of other ordinary due from banks, the cash flow discount method is used to estimate the fair value. <br>

- Securities measured at amortized cost: The fair value of securities measured at amortized cost is computed by widely-accepted appraisal agencies upon request.

Loans measured at amortized cost: The fair value of loans measured at amortized cost is the expected future cash flows, reflecting premature redemption ratio, discounted by the market interest rate, adjusted by a spread sheet considering the probability of default. Exceptions to this method include loans with credit line facilities, loans with a maturity of three months or less left and impaired loans, which the Bank assumes the carrying amount as the fair value. <br>

Deposits: The fair value of deposits is computed using the discounted cash flow method. However, for deposits, whose cash flows cannot be estimated reasonably, the Bank assumes the carrying amount as the fair value. <br>

Borrowings: The fair value of industrial financial debentures is computed using the discounted cash flow method by the Bank's Fair Value Evaluation System. However, for borrowings including call money whose contractual maturity is three months or less, the Bank assumes the carrying amount as the fair value. <br>

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**44. <u>Fair Value of Financial Assets and Liabilities, Continued</u>**

- Debentures: The fair value of industrial financial debentures is computed using the discounted cash flow method by the Bank's Fair Value Evaluation System.

Other financial assets and liabilities: The fair value of other financial assets and liabilities is computed using the discounted cash flow method. However, in cases cash flow cannot be estimated reasonably, the Bank assumes the carrying amount as the fair value. <br>

(ii) The fair value hierarchy of financial instruments measured at amortized cost as of December 31, 2024 and
2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Level 1** | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Financial assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks (\*) | W | 9633962 | 3361559 |  | 12995521 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  | 3492235 | 5444070 |  | 8936305 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost (\*) |  |  | 2824285 | 207162934 | 209987219 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets (\*) |  |  | 6105731 | 1691860 | 7797591 |
|  | W | 13126197 | 17735645 | 208854794 | 239716636 |
|  Financial liabilities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits (\*) | W |  | 2077635 | 64077827 | 66155462 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings (\*) |  |  | 3975955 | 28621339 | 32597294 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  |  | 167652781 |  | 167652781 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities (\*) |  |  | 4427119 | 5313603 | 9740722 |
|  | W |  | 178133490 | 98012769 | 276146259 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Level 1** | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Financial assets: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks (\*) | W | 6195521 | 2464287 |  | 8659808 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  | 3841102 | 4742086 |  | 8583188 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost (\*) |  |  | 4547212 | 195510878 | 200058090 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets (\*) |  |  | 8432806 | 1701156 | 10133962 |
|  | W | 10036623 | 20186391 | 197212034 | 227435048 |
|  Financial liabilities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits (\*) | W |  | 1896208 | 64054989 | 65951197 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings (\*) |  |  | 2268046 | 25322073 | 27590119 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  |  | 157898543 |  | 157898543 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities (\*) |  |  | 7027953 | 4772875 | 11800828 |
|  | W |  | 169090750 | 94149937 | 263240687 |

---

---

| | |
|:---|:---|
| (\*) | For financial instruments categorized as level 2, the carrying amount is considered as a reasonable approximation of the fair value and is thus, disclosed by fair value.  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**44. <u>Fair Value of Financial Assets and Liabilities, Continued</u>**

(iii) Details of valuation technique and inputs used in the fair value measurement categorized within level 2 and
level 3 of the fair value hierarchy of financial instruments measured at amortized cost as of December 31, 2024 and 2023 are as follows:

---

| | | |
|:---|:---|:---|
|  | **Valuation technique** | **Input** |
|  Level 2 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost | Discounted cash flow method | Discount rate |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures | Discounted cash flow method | Discount rate |
|  Level 3 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost | Discounted cash flow method | Credit spread, other spread, prepayment rate |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets | Discounted cash flow method | Other spread |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits | Discounted cash flow method | Other spread |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings | Discounted cash flow method | Other spread |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities | Discounted cash flow method | Other spread |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**45. <u>Categories of Financial Assets and Liabilities</u>** 

Categories of financial assets and liabilities as of December 31, 2024 and 2023 are as follows:

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Cash and<br>cash<br>equivalents** | **Cash and<br>cash<br>equivalents** | **Financial<br>instruments<br>measured<br>at FVTPL** | **Financial<br>instruments<br>designated<br>at FVTPL** | **Financial<br>instruments<br>measured<br>at FVOCI** | **Financial<br>instruments<br>designated<br>at FVOCI** | **Financial<br>instruments<br>measured at<br>amortized<br>cost** | **Hedging<br>purpose<br>derivative<br>instruments** | **Total** |
|  Financial assets: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks | W | 9633962 |  |  |  |  | 3361559 |  | 12995521 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  |  | 18418800 |  |  |  |  |  | 18418800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  |  |  |  | 17412051 | 15348142 |  |  | 32760193 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  |  |  |  |  |  | 8936305 |  | 8936305 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL |  |  | 419773 |  |  |  |  |  | 419773 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost |  | 4241051 |  |  |  |  | 205240302 |  | 209481353 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets |  |  | 13624445 |  |  |  |  | 290806 | 13915251 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  |  |  |  |  |  | 7798105 |  | 7798105 |
|  | W | 13875013 | 32463018 |  | 17412051 | 15348142 | 225336271 | 290806 | 304725301 |
|  Financial liabilities: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL | W |  |  | 2389246 |  |  |  |  | 2389246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits |  |  |  |  |  |  | 66100573 |  | 66100573 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  |  |  |  |  | 32730518 |  | 32730518 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  |  |  |  |  |  | 165102269 |  | 165102269 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities |  |  | 13733198 |  |  |  |  | 1140741 | 14873939 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  |  |  |  |  |  | 9778765 |  | 9778765 |
|  | W |  | 13733198 | 2389246 |  |  | 273712125 | 1140741 | 290975310 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**45. <u>Categories of Financial Assets and Liabilities, Continued</u>**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Cash and<br>cash<br>equivalents** | **Cash and<br>cash<br>equivalents** | **Financial<br>instruments<br>measured<br>at FVTPL** | **Financial<br>instruments<br>designated<br>at FVTPL** | **Financial<br>instruments<br>measured<br>at FVOCI** | **Financial<br>instruments<br>designated<br>at FVOCI** | **Financial<br>instruments<br>measured at<br>amortized<br>cost** | **Hedging<br>purpose<br>derivative<br>instruments** | **Total** |
|  Financial assets: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks | W | 6195521 |  |  |  |  | 2464287 |  | 8659808 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  | 162256 | 15896300 |  |  |  |  |  | 16058556 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  |  |  |  | 18243848 | 15644216 |  |  | 33888064 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  |  |  |  |  |  | 8583188 |  | 8583188 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL |  |  | 488432 |  |  |  |  |  | 488432 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost |  | 5502800 |  |  |  |  | 194478980 |  | 199981780 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets |  |  | 6821024 |  |  |  |  | 562301 | 7383325 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  |  |  |  |  |  | 10136642 |  | 10136642 |
|  | W | 11860577 | 23205756 |  | 18243848 | 15644216 | 215663097 | 562301 | 285179795 |
|  Financial liabilities: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL | W |  |  | 1920061 |  |  |  |  | 1920061 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits |  |  |  |  |  |  | 65897732 |  | 65897732 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  |  |  |  |  |  | 27745629 |  | 27745629 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  |  |  |  |  |  | 156933867 |  | 156933867 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities |  |  | 6961386 |  |  |  |  | 693515 | 7654901 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  |  |  |  |  |  | 11823274 |  | 11823274 |
|  | W |  | 6961386 | 1920061 |  |  | 262400502 | 693515 | 271975464 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**46. <u>Offsetting of Financial Assets and Liabilities</u>** 

Details of financial instruments subject to offsetting, enforceable master netting agreements or similar agreements as of December 31, 2024 and 2023 are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| | **Gross amounts**<br>**of recognized**<br>**financial asset** | **Gross amounts**<br>**of recognized**<br>**financial asset** | **Gross amounts of**<br>**recognized**<br>**financial liabilities**<br>**set off in the<br>statement of**<br>**financial position** | **Net amounts of**<br>**financial assets**<br>**presented in the**<br>**statement of**<br>**financial position** | **Related amounts not set off**<br>**in the statement of financial**<br>**position** | **Related amounts not set off**<br>**in the statement of financial**<br>**position** | **Net amounts** |
| | **Gross amounts**<br>**of recognized**<br>**financial asset** | **Gross amounts**<br>**of recognized**<br>**financial asset** | **Gross amounts of**<br>**recognized**<br>**financial liabilities**<br>**set off in the<br>statement of**<br>**financial position** | **Net amounts of**<br>**financial assets**<br>**presented in the**<br>**statement of**<br>**financial position** | **Financial**<br>**instruments** | **Cash collateral**<br>**received** | **Net amounts** |
|  Derivative financial assets (\*) | W | 13915251 |  | 13915251 | 10019614 | 62644 | 3832993 |
|  Unsettled spot exchange receivables (\*) |  | 4171827 |  | 4171827 | 4171331 |  | 496 |
|  Unsettled domestic exchange receivables |  | 4246146 | 2312241 | 1933905 |  |  | 1933905 |
|  Security pledged as collateral for repurchase agreements |  | 520000 |  | 520000 | 47181 |  | 472819 |
|  Reverse repurchase agreements |  | 1676700 |  | 1676700 | 1676700 |  |  |
|  Loaned securities |  | 40409 |  | 40409 | 40409 |  |  |
|  Receivables from securities transaction |  | 4206 |  | 4206 | 4206 |  |  |
|  | W | 24574539 | 2312241 | 22262298 | 15959441 | 62644 | 6240213 |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Gross amounts of**<br>**recognized**<br>**financial liabilities** | **Gross amounts of**<br>**recognized**<br>**financial liabilities** | **Gross amounts of**<br>**recognized**<br>**financial assets**<br>**set off in the**<br>**statement of**<br>**financial position** | **Net amounts of<br>financial liabilities<br>presented in the**<br>**statement of**<br>**financial position** | **Related amounts not set off**<br>**in the statement of financial**<br>**position** | **Related amounts not set off**<br>**in the statement of financial**<br>**position** | **Net amounts** |
|  | **Gross amounts of**<br>**recognized**<br>**financial liabilities** | **Gross amounts of**<br>**recognized**<br>**financial liabilities** | **Gross amounts of**<br>**recognized**<br>**financial assets**<br>**set off in the**<br>**statement of**<br>**financial position** | **Net amounts of<br>financial liabilities<br>presented in the**<br>**statement of**<br>**financial position** | **Financial<br>instruments** | **Cash collateral<br>pledged** | **Net amounts** |
|  Derivative financial liabilities (\*) | W | 14873939 |  | 14873939 | 8518079 | 293465 | 6062395 |
|  Unsettled spot exchange payables (\*) |  | 4172071 |  | 4172071 | 4171331 |  | 740 |
|  Unsettled domestic exchange payables |  | 2567289 | 2312241 | 255048 |  |  | 255048 |
|  Repurchase agreements |  | 47181 |  | 47181 | 47181 |  |  |
|  Payables from securities transaction |  | 16102 |  | 16102 | 16102 |  |  |
|  | W | 21676582 | 2312241 | 19364341 | 12752693 | 293465 | 6318183 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**46. <u>Offsetting of Financial Assets and Liabilities, Continued</u>**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| | **Gross amounts of**<br>**recognized**<br>**financial asset** | **Gross amounts of**<br>**recognized**<br>**financial asset** | **Gross amounts of**<br>**recognized financial**<br>**liabilities set off in**<br>**the statement of**<br>**financial position** | **Net amounts of**<br>**financial assets**<br>**presented in the**<br>**statement of**<br>**financial position** | **Related amounts not set off<br>in the statement of financial**<br>**position** | **Related amounts not set off<br>in the statement of financial**<br>**position** | **Net amounts** |
| | **Gross amounts of**<br>**recognized**<br>**financial asset** | **Gross amounts of**<br>**recognized**<br>**financial asset** | **Gross amounts of**<br>**recognized financial**<br>**liabilities set off in**<br>**the statement of**<br>**financial position** | **Net amounts of**<br>**financial assets**<br>**presented in the**<br>**statement of**<br>**financial position** | **Financial**<br>**instruments** | **Cash collateral**<br>**received** | **Net amounts** |
|  Derivative financial assets (\*) | W | 7383325 |  | 7383325 | 4953052 | 171466 | 2258807 |
|  Unsettled spot exchange receivables (\*) |  | 6494499 |  | 6494499 | 6493455 |  | 1044 |
|  Unsettled domestic exchange receivables |  | 5110172 | 3171865 | 1938307 |  |  | 1938307 |
|  Security pledged as collateral for repurchase agreements |  | 1447767 |  | 1447767 | 30095 |  | 1417672 |
|  Reverse repurchase agreements |  | 2599900 |  | 2599900 | 2599900 |  |  |
|  Loaned securities |  | 39341 |  | 39341 | 39341 |  |  |
|  Receivables from securities transaction |  | 39213 |  | 39213 | 39213 |  |  |
|  | W | 23114217 | 3171865 | 19942352 | 14155056 | 171466 | 5615830 |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| | **Gross amounts of**<br>**recognized**<br>**financial liabilities** | **Gross amounts of**<br>**recognized**<br>**financial liabilities** | **Gross amounts of**<br>**recognized**<br>**financial assets**<br>**set off in the**<br>**statement of**<br>**financial position** | **Net amounts of**<br>**financial liabilities**<br>**presented in the**<br>**statement of**<br>**financial position** | **Related amounts not set off**<br>**in the statement of financial**<br>**position** | **Related amounts not set off**<br>**in the statement of financial**<br>**position** | **Net amounts** |
| | **Gross amounts of**<br>**recognized**<br>**financial liabilities** | **Gross amounts of**<br>**recognized**<br>**financial liabilities** | **Gross amounts of**<br>**recognized**<br>**financial assets**<br>**set off in the**<br>**statement of**<br>**financial position** | **Net amounts of**<br>**financial liabilities**<br>**presented in the**<br>**statement of**<br>**financial position** | **Financial**<br>**instruments** | **Cash collateral**<br>**pledged** | **Net amounts** |
|  Derivative financial liabilities (\*) | W | 7654901 |  | 7654901 | 4385976 | 207942 | 3060983 |
|  Unsettled spot exchange payables (\*) |  | 6494121 |  | 6494121 | 6493455 |  | 666 |
|  Unsettled domestic exchange payables |  | 3705699 | 3171866 | 533833 |  |  | 533833 |
|  Repurchase agreements |  | 30095 |  | 30095 | 30095 |  |  |
|  Payables from securities transaction |  | 13536 |  | 13536 | 13536 |  |  |
|  | W | 17898352 | 3171866 | 14726486 | 10923062 | 207942 | 3595482 |

---

---

| | |
|:---|:---|
| (\*) | For the derivatives covered by the ISDA derivative contracts, all contracts are settled and the net amount of derivative contracts is measured and paid based on the liquidation value if the counterparty files for bankruptcy or has any credit issues.  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**47. <u>Operating Segments</u>** 

(1) The Bank has four reportable segments, as described below, which are the Bank's strategic business units.
They are managed separately because each business requires different technology and marketing strategies. The following summary describes general information about each of the Bank's reportable segments:

---

| | |
|:---|:---|
| **Segments** | **General information** |
|  Corporate finance | Provides trade finance and loans to corporate customers |
|  Investment finance | Provides consulting services to corporate such as capital finance, restructuring, etc. |
|  Asset management | Provides asset management services to individual and corporate customers |
|  Others | Any other segment not mentioned above |

---

(2) Operating income (loss) from external customers and among operating segments for the years ended
December 31, 2024 and 2023 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **Corporate<br>finance** | **Corporate<br>finance** | **Investment<br>finance** | **Asset<br>management** | **Others** | **Total** |
|  Operating income (loss) from external customers | W | 5982755 | 1352710 | 41950 | (5083299) | 2294116 |
|  Operating income (loss) from intersegment sales |  | 20589 | 167747 |  | (188336) |  |
|  | W | 6003344 | 1520457 | 41950 | (5271635) | 2294116 |
|  | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **Corporate<br>finance** | **Corporate<br>finance** | **Investment<br>finance** | **Asset<br>management** | **Others** | **Total** |
|  Operating income (loss) from external customers | W | 3202060 | 1923113 | 55327 | (2183645) | 2996855 |
|  Operating income (loss) from intersegment sales |  | (24918) | (1256628) |  | 1281546 |  |
|  | W | 3177142 | 666485 | 55327 | (902099) | 2996855 |

---

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**47. <u>Operating Segments, Continued</u>**

(3) Details of segment results for the Bank's reportable segments for the years ended December 31, 2024
and 2023 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2024** | **2024** | **2024** | **2024** |
|  | **Corporate<br>finance** | **Corporate<br>finance** | **Investment<br>finance** | **Asset<br>management** | **Others** | **Total** |
|  Net interest income | W | 1653158 | (592763) | 16053 | 41617 | 1118065 |
|  Non-interest income |  |  |  |  |  |  |
|  Income related to securities (\*1) |  | 293996 | 313002 |  | 142993 | 749991 |
|  Other non-interest income |  | 4350033 | 1952285 | 35170 | (5241810) | 1095678 |
|  |  | 4644029 | 2265287 | 35170 | (5098817) | 1845669 |
|  Provision for loan losses and others (\*2) |  | 237772 | (71267) |  | 20960 | 187465 |
|  General and administrative expenses |  | (531615) | (80800) | (9273) | (235395) | (857083) |
|  Operating income | W | 6003344 | 1520457 | 41950 | (5271635) | 2294116 |
|  | **2023** | **2023** | **2023** | **2023** | **2023** | **2023** |
|  | **Corporate<br>finance** | **Corporate<br>finance** | **Investment<br>finance** | **Asset<br>management** | **Others** | **Total** |
|  Net interest income | W | 2075842 | (559810) | 17914 | 27573 | 1561519 |
|  Non-interest income |  |  |  |  |  |  |
|  Income related to securities (\*1) |  | 7580 | 317583 |  | 167558 | 492721 |
|  Other non-interest income |  | 959020 | 684697 | 44568 | (775110) | 913175 |
|  |  | 966600 | 1002280 | 44568 | (607552) | 1405896 |
|  Provision for loan losses and others (\*2) |  | 571679 | 283665 |  | (1913) | 853431 |
|  General and administrative expenses |  | (436979) | (59650) | (7155) | (320207) | (823991) |
|  Operating income | W | 3177142 | 666485 | 55327 | (902099) | 2996855 |

---

(\*1) Income related to securities is composed of net gain (loss) on securities measured at FVTPL, securities measured at FVOCI and securities measured at amortized cost.

(\*2) Provision for loan losses and others comprises of provision for loan losses, provision for derivative credit risks, gains (losses) on sales of loans, and increase (reversal) of provision.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**47. <u>Operating Segments, Continued</u>**

(4) Geographical revenue information about the Bank's operating segments for the years ended
December 31, 2024 and 2023 and the geographical non-current asset information as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Revenues (\*1)** | **Revenues (\*1)** | **Revenues (\*1)** | **Non-current assets (\*2)** | **Non-current assets (\*2)** |
|  | **2024** | **2024** | **2023** | **December 31,<br>2024** | **December 31,<br>2023** |
|  Domestic | W | 66878265 | 40864069 | 34059881 | 31641008 |
|  Overseas |  | 2981348 | 2637622 | 122342 | 123367 |
|  | W | 69859613 | 43501691 | 34182223 | 31764375 |

---

(\*1) Revenues consist of interest income, fees and commission income, dividend income, income related to securities, gain on derivatives, foreign currency transaction gain, other operating income and provision for loan losses.

(\*2) Non-current assets consist of investments in subsidiaries and associates, property and equipment, investment property and intangible assets.

**48. <u>Risk Management</u>** 

***(1) Introduction***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Objectives and principles***

The Bank's risk management aims to maintain financial soundness and effectively manage various risks pertinent to the nature of the Bank's business. The Bank has set up and fulfilled policies to manage risks timely and effectively. Pursuant to the policies, the Bank's risks shall be

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• managed comprehensively and independently,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• recognized timely, evaluated exactly and managed effectively,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• maintained to the extent that the risks balance with profit,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• diversified appropriately to avoid concentration on specific segments,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• managed to prevent excessive exposure by the setting up and managing of tolerance limits and guidelines.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Risk management strategy and process***

The Bank's risk management business is separated into two different stages; the 'metrification stage,' in which risks are estimated and monitored, and the 'integration stage,' in which information gained during the risk management process is integrated and used in management strategies. Risk management is recognized as a key component of the Bank's management and seeks to change from its previously adaptive and limited role to more leading and comprehensive role.

Furthermore, the Bank focuses on consistent communication among different departments to establish a progressive consensus on risk management.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Risk management governance***

*Risk Management Committee* 

The Bank's Risk Management Committee (the "Committee") is composed of the President of the committee (an outside director), and three other commissioners. The Committee functions to establish policies of risk management, evaluate the capital adequacy of the Bank, discuss material issues relating to risk management, and present preliminary decisions on such matters.

*The CEO of the Bank and the head of Risk Management Segment* 

The CEO of the Bank, according to the policies of risk management, performs his or her role to manage and direct risk management to sustain efficiency and internal control. The head of the Risk Management Segment is responsible for supervising the overall administration of the Bank's risk management business and providing risk-related information to members of the board of directors and the Bank's management.

*Risk Management Policy Committee* 

The Bank's Risk Management Policy Committee is composed of the leaders of all business segments. and exercises its role to decide important matters relating to the Bank's portfolio including allocating internal capital limits by segment and setting exposure limits by industry within the scope that Risk Management Committee regulated.

*Risk Management Steering Committee* 

Established under the Risk Management Council, the Risk Management Steering Committee (Steering Committee) is comprised of the heads of relevant departments. The Steering Committee is responsible for: preliminary review on the decisions of the Risk Management Council; establishing operational limits under the Regulatory Liquidity Book; and reporting on important matters related to risks.

*Operational Risk Management Council* 

Established under the Risk Management Council, the Operational Risk Management Council is comprised of the heads of relevant departments. The Operational Risk Management Council conducts reviews, makes decisions and provide reports on matters related to operational risks.

&nbsp;&nbsp;&nbsp;&nbsp;***(iv) Performance of risk management committee***

The Risk Management Committee performs comprehensive reviews of all the affairs related to risk management and deliberates the decisions of the board of directors. For the year ended December 31, 2024, the key activities of the Risk Management Committee are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Major decision

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Risk management plan for 2024

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Contingency funding plan for 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Setting and managing exposure limits by country for 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Increase in internal capital limit

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Major reporting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Result of ex-post validation of credit rating system and default rates,
and verification of risk measurement factors for internal purposes

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Setting management limit of credit portfolios of 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Resolution of Credit Committee for the fourth quarter of 2023

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Allocation of internal capital limits of 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Adjustment of exposure limits by country

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Resolution of Credit Committee for the first quarter of 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Result of integrated crisis analysis for the first half of 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Revision of the application period for additional loan loss provisions for COVID-19-affected firms

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Resolution of Credit Committee for the second quarter of 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Result of operation of corporate credit rating system in 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Verification of risk-weighted assets for BIS ratio as of December 31, 2023

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Resolution of Credit Committee for the third quarter of 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Result of BCP training for 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Result of integrated crisis analysis for the second half of 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Result of assessment of suitability for internal capital for 2024

&nbsp;&nbsp;&nbsp;&nbsp;***(v) Improvement of risk management system***

For the continuous improvement of risk management, financial soundness and capital adequacy, the Bank performs the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Continuous improvement of Basel

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Improvements in the internal capital adequacy assessment system, in line with the guidelines set by the Financial
Supervisory Service (FSS) in 2008, to manage capital adequacy more effectively

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Improvements in the credit assessment system on Low Default Portfolio (LDP)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Elaboration of risk measuring criteria including credit risk parameters and measurement logics

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Development of the application system for timely calculation of LCR and NSFR

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Rebuilding the Corporate Credit Rating System (approved by Financial Supervisory Services on October 26,
2017)

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Establishment of the system to calculate Basel Interest Rate Risk in the Banking Book coming to domestic in
September 2018

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Establishment of the system to comply with the amended regulation relating to risk-weighted assets under Basel
III in December 2020

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Development of system related to Fundamental Review of the Trading Book (FRTB) under Basel III in August 2022

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Development of system related to operational risk under Basel III in September 2022

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Expansion of risk management infrastructure

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Establishment of the RAPM system to reflect risks to the Bank's business and support decision-making upon
management, and application of performance assessment at the branch level since 2010

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Enforcement of risk management related to irregular compound derivatives and validation of the derivative pricing
model developed by the Bank's Front Office

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Establishment of IFRS 9 accounting system to calculate a loan loss allowances under IFRS 9 in March 2017 and,
since then, run of IFRS 9 accounting system in January 2018

&nbsp;&nbsp;&nbsp;&nbsp;***(vi) Risk management reporting and measuring system***

The Bank endeavours consistently to objectively and rationally measure and manage all significant risks considering the characteristics of operational areas, assets and risks. In relation to reporting and measurement, the Bank has developed application systems as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Application system** | **Approach** | **Completion<br>date** | **Major function** |
|  Corporate Credit Rating System | Logit Model | Oct. 2017 | Rebuilding the Corporate Credit Rating System |
|  Market Risk Management System | Murex FRTB | Sep. 2022 | Calculation of regulatory capital and internal capital under FRTB SA Standards and stress testing analysis |
|  Interest/Liquidity Risk Management System | In-house | May. 2019 | Calculation of interest risk, liquidity risk, etc. |
|  Operational Risk Management System | Standardized Approach | Sep. 2022 | Calculation of operation risk, RCSA, KRI and management of loss events, etc. |
|  BIS Capital Ratio<br> Calculation/Credit Risk<br> Measurement System | Fermat<br> RaY | Sep. 2006<br> Dec. 2013 | Calculate equity, credit risk-weighted assets and credit risk, etc. |
|  Loan Loss Allowance | IFRS | Jan. 2011 | Incurred loss model |
|  Calculation System | IFRS 9 | Mar. 2017 | Expected loss model |

---

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;***(vii) Response to Basel***

The Korean financial authorities have implemented Basel II since January 2008, and the Standardized Approach and the Foundation Internal Ratings-Based Approach for calculating credit risk are applicable.

In conformity with the implementation roadmap of Basel II, the Bank obtained the approval to use the Foundation Internal Ratings-Based Approach on credit risk from the FSS in July 2008 and has applied the approach since late June 2008. The Bank applies the Standardized Approach on market risks and operational risks.

The Bank completed the Basel III standard risk management system in preparation of the adoption of the Basel III regulations announced on December 1, 2013. Starting from 2013 year-end, the BIS capital adequacy ratio has been measured in accordance to the Basel III regulations.

Responding to the requirements of the financial authorities, the Bank recognizes interest rate risk, liquidity risk, credit bias risk and reputation risk besides Pillar I risks (credit risk, market risk and operational risk). The Bank has actively responded to the Pillar 2 regulation, including additional capital requirements based on comprehensive assessment of risk management levels since 2015. In addition, from the end of 2015, the Bank has applied the uniform standards for the public announcement of financial business for Basel compliance.

The Bank completed revised standards such as capital requirements for banks' investments in funds in 2017, capital requirements for securitization in 2018, and the Standardised Approach for measuring counterparty credit risk (SA-CCR) in 2019.

To comply with the amended regulation relating to risk-weighted assets under Basel III, the Bank completed the consultation and the development of the relevant systems and the amended regulation has been applied since the calculation of the BIS ratio at the end of 2020.

The Bank completed IT consulting and system development related to the revised Market Risk Regulation (FRTB) and Operational Risk Regulation under Basel III during the second half of 2022. After conducting parallel calculations under both Basel II and Basel III standards during the second half of 2022, the Bank has been operating under the Basel III framework since January 2023.

&nbsp;&nbsp;&nbsp;&nbsp;***(viii) Internal capital adequacy assessment process***

Internal capital adequacy assessment process is defined as the process that the Bank aggregates significant risks, calculates its internal capital, compares the internal capital with the available capital and assesses its internal capital adequacy. The internal capital adequacy report including the assessment results at the end of the year is prepared and reported to the Risk Management Policy Committee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Internal capital adequacy assessment

For the internal capital adequacy assessment, the Bank calculates its aggregated internal capital by evaluating all significant risks and available capital considering the quality and components of capital, and then assesses the internal capital adequacy by comparing the aggregated internal capital with the available capital.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

In addition, the Bank conducts periodic stress tests more than once every six months to assess potential weakness in crisis situations and uses its results to assess the internal capital adequacy. The Bank assumes the macroeconomic situation as three stages of 'normal- pessimistic-serious' and is preparing countermeasures such as checking the adequacy of capital by each stage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Goal setting of internal capital management

The Bank sets up and manages an internal capital limit on an annual basis, through the approval of the Risk Management Committee, to maintain internal capital adequacy by managing internal capital (integrated risks) within the extent of available capital.

The prior year's internal capital, analysis of domestic and foreign environment changes in the current year, and the direction and size of operations are all reflected in the goal setting of internal capital management to calculate the integrated internal capital scale. Moreover, Bank for International Settlements(BIS) capital adequacy ratio and risk appetite are taken into consideration in the goal setting of internal capital management.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Allocation of internal capital

The Bank's Risk Management Committee approves entire internal capital and the Risk Management Policy Committee allocates the capital to each segment and department, considering the extent of possible risk faced and size of operations. The allocated internal capital is monitored regularly and managed using various management methods. The results of monitoring and managing the allocated internal capital are reported to the Risk Management Committee. In case of any material changes in the Bank's business plan or risk operation strategy, the Bank adjusts the allocations elastically.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Composition of internal capital

Internal capital comprises all the significant risks of the Bank and is composed of quantifiable and non-quantifiable risks. Quantifiable risks are composed of credit risk, market risk, interest rate risk, operational risk, liquidity risk and credit concentration risk, foreign currency settlement risk, and are risks measured quantitatively by applying reasonable methodology using objective data. Non-quantifiable risks are composed of strategy risk, reputation risk, residual risk on asset securitization and furthermore. Non-quantifiable risks are those risks that cannot be measured quantitatively because of lack of data or the absence of appropriate measuring methodologies.

***(2) Credit Risk***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Concept***

Credit risk can be defined as potential loss resulting from the refusal to perform obligations or default of counterparties. More generally, it is used to refer to the possibility of loss from engaged bonds that cannot be redeemed properly or from substitute payments.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Approach to credit risk management***

*Summary of credit risk management* 

The Bank regards credit risk as the most significant risk area in its business operations, and accordingly, closely monitors its credit risk exposure. The Bank manages both credit risks at portfolio level and at individual credit level. At portfolio level, the Bank reduces credit concentration and restructures the portfolio in such a way to maximize profitability considering the risk level. To avoid credit concentration on a particular sector, the Bank manages credit limits by client, group, and industry. The Bank also resets exposure management directives for each industry by conducting an industry credit evaluation twice a year.

At the individual credit level, the relationship manager (RM), the credit officer (CO) and the Credit Review Committee manage each borrower's credit risk.

*Post management and insolvent borrower management* 

The Bank monitors the borrower's credit rating from the date of the loan to the date of the final collection of debt consistently and inspects the borrower's status frequently to prevent the generation of new bad debts and to stabilize the number of debt recoveries.

In addition, an early warning system is operated to spot borrowers that are highly likely to be insolvent. The early warning system provides financial information, financial transaction information, public information and market information of the borrower, and such information is used by the RM and the CO to monitor and manage changes in the borrower's credit rating.

A borrower that is likely to be insolvent is classified as an early warning borrower, depending on the level of insolvency risk. The Bank sets up a specific and applicable stabilization plan for such a borrower considering the borrower's characteristics. Furthermore, sub-standard borrowers are classified as insolvent borrowers, and are managed intensively by the Bank, which takes legal proceedings, disposals or corporate turnaround measures if necessary.

*Classification of asset soundness and provision of allowance for loss* 

Classification of asset soundness is fulfilled by the analysis and assessment of credit risk. The classification is used to provide an appropriate allowance, prevent further occurrences of insolvent assets and promote the normalization of existing insolvent assets to enhance the stabilization of asset operations.

Based on the Financial Supervisory Regulations of the Republic of Korea, the Bank has established standards and guidelines on the classification of asset soundness, according to the Forward-Looking Criteria, which reflects not only the borrower's past records of repayment but also their future debt repayment capability.

In conformity with these standards, the Bank classifies the soundness of its assets as "normal", "precautionary", "substandard", "doubtful", or "estimated loss" and differentiates the coverage ratio by the level of classification.

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

Details of loans by credit rating as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; < Corporate > |  |  |  |  |  |
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Carrying amounts** | **Carrying amounts** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
|  | **Carrying amounts** | **Carrying amounts** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  AAA ~ BBB1 | W | 180348619 | 159388765 | 20959854 |  |
|  BBB2 ~ CCC |  | 30814870 | 11229886 | 18561521 | 1023463 |
|  Below CC |  | 1101360 |  | 100 | 1101260 |
|  | W | &nbsp;&nbsp;&nbsp;&nbsp;212264849 | 170618651 | 39521475 | 2124723 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
| | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  AAA ~ BBB1 | W | 173049276 | 154937789 | 18111487 |  |
|  BBB2 ~ CCC |  | 28462327 | 10457743 | 16807917 | 1196667 |
|  Below CC |  | 1412185 |  |  | 1412185 |
|  | W | 202923788 | 165395532 | 34919404 | 2608852 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; < Retail > |  |  |  |  |  |
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit<br>loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
|  | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit<br>loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  Grade 1~ Grade 6 | W | 114899 | 109559 | 5307 | 33 |
|  Grade 7~ Grade 8 |  | 1205 |  | 1205 |  |
|  Grade 9~ Grade 10 |  | 1502 |  |  | 1502 |
|  | W | 117606 | 109559 | 6512 | 1535 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
|  | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  Grade 1~ Grade 6 | W | 140982 | 135315 | 5667 |  |
|  Grade 7~ Grade 8 |  | 1322 |  | 1306 | 16 |
|  Grade 9~ Grade 10 |  | 1230 |  |  | 1230 |
|  | W | 143534 | 135315 | 6973 | 1246 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

Details of payment guarantees (including financial guarantees) and unused commitments by credit rating as of December 31, 2024 and 2023 are as follows:

< Corporate >

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| | **Exposures** | **Exposures** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
| | **Exposures** | **Exposures** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  Unused commitments: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AAA ~ BBB1 | W | 50579198 | 46235837 | 4343361 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BBB2 ~ CCC |  | 5699307 | 3365397 | 2285478 | 48432 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Below CC |  | 397 |  |  | 397 |
|  | W | &nbsp;&nbsp;&nbsp;&nbsp;56278902 | 49601234 | 6628839 | 48829 |
|  Payment guarantees (including financial guarantees): |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AAA ~ BBB1 | W | 8255939 | 7466921 | 789018 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BBB2 ~ CCC |  | 11035950 | 5176575 | 5842792 | 16583 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Below CC |  | 50886 |  |  | 50886 |
|  | W | &nbsp;&nbsp;&nbsp;&nbsp;19342775 | 12643496 | 6631810 | 67469 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| | **Exposures** | **Exposures** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
| | **Exposures** | **Exposures** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  Unused commitments: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AAA ~ BBB1 | W | 48742342 | 44927503 | 3814839 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BBB2 ~ CCC |  | 6034409 | 2350626 | 3622987 | 60796 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Below CC |  |  |  |  |  |
|  | W | 54776751 | 47278129 | 7437826 | 60796 |
|  Payment guarantees (including financial guarantees): |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AAA ~ BBB1 | W | 7779809 | 6962566 | 817243 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BBB2 ~ CCC |  | 10515773 | 4612674 | 5885145 | 17954 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Below CC |  | 68808 |  | 86 | 68722 |
|  | W | 18364390 | 11575240 | 6702474 | 86676 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; < Retail > |  |  |  |  |  |
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Exposures** | **Exposures** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
|  | **Exposures** | **Exposures** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  Unused commitments: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1~ Grade 6 | W | 33418 | 33171 | 247 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 7~ Grade 8 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 9~ Grade 10 |  |  |  |  |  |
|  | W | 33418 | 33171 | 247 |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| | **Exposures** | **Exposures** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
| | **Exposures** | **Exposures** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  Unused commitments: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 1~ Grade 6 | W | 39887 | 39310 | 577 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 7~ Grade 8 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Grade 9~ Grade 10 |  |  |  |  |  |
|  | W | 39887 | 39310 | 577 |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Measurement methodology of credit risk***

Pursuant to Basel III, the Bank selects the measurement methodology of credit risk considering the complexity of measurement, measurement factors, estimating methods and others. Measurement approaches are divided into Standardized Approach and Internal Ratings-Based Approach.

*Standardized Approach ("SA")* 

In the case of the Standardized Approach, the risk weights are applied according to the credit rating assessed by External Credit Assessment Institution ("ECAI"). Risk weights in each credit rating are as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Credit rating** | **Corporate** | **Country** | **Bank** |
|  AAA ~ AA- | 20.0% | 0.0% | 20.0% |
|  A+ ~ A- | 50.0% | 20.0% | 30.0% |
|  BBB+ ~ BBB- | 75.0% | 50.0% | 50.0% |
|  BB+ ~ BB- | 100.0% | 100.0% | 100.0% |
|  B+ ~ B- | 150.0% | 100.0% | 100.0% |
|  Below B- | 150.0% | 150.0% | 150.0% |
|  Unrated | 100.0% (\*) | 100.0% | Rating based on due<br>diligence |

---

---

| | |
|:---|:---|
| (\*) | In case of small and medium-sized business, 85.0% is applied.  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

The OECD is designated as foreign ECAI and Korea Investrors Service Co., Ltd., NICE Investors Services Co., Ltd. and the Korea Ratings Co., Ltd. are designated as domestic ECAI.

The Bank applies the credit rating based on the corresponding loan and same borrower's unsecured senior loans. In the case the borrower's risk weight is higher than the unrated exposure's risk weight (100%), the higher weight is applied. In the case the borrower has more than one rating, the higher weight of the two lowest weights (Second Best Criteria) is applied.

*Internal Ratings-Based Approach (IRB)* 

To use the Internal Ratings-Based Approach, a bank must be approved by the FSS and should also meet the requirement pre-set by the FSS.

In relation to Basel II that has been adopted domestically as of January 2008, the Bank gained approval from the FSS to use the Foundation Internal Ratings-Based Approach in July 2008. The Bank has calculated credit risk-weighted assets using the approach since late June 2008.

*Measurement method of credit risk-weighted asset* 

The Bank calculates credit risk-weighted assets of corporate exposures and asset securitization exposures using the Foundation Internal Ratings-Based Approach as of December 31, 2024.

The Standardized Approach is applied to country exposures, public institution exposures and bank exposures permanently and applied to overseas subsidiary and the Bank's branch pursuant to prior consultation with the FSS.

---

| | | |
|:---|:---|:---|
| **Measurement method** | **Measurement method** | **Exposure**<br>|
|  Standardized Approach | Permanent SA | — Countries, public institutions, banks, equity<br>|
|  Standardized Approach | SA | — Overseas subsidiaries and branches, and other assets, retail, residential mortgage, commercial properties<br>|
|  Foundation Internal Ratings-Based Approach | Foundation Internal Ratings-Based Approach | — Corporate, small and medium enterprises, asset securitization (at each credit level)<br>|
| Application of IRB by phase | Application of IRB by phase | — Special lending, non-residence and others<br>|

---

The mitigated effect of credit risks reflects the related policies which consider eligible collateral and guarantees. The Bank calculates the credit risk-weighted assets using the capital adequacy ratio.

Upon the calculation of credit risk-weighted assets for derivatives, the Bank takes into consideration the set-off effects of transactions under legally enforceable rights to set-off to calculate exposures.

*Credit rating model* 

The results of credit rating are presented as grades through an assessment of the debt repayment capacity that the principal and interest of debt securities or loans are redeemed while complying with contractual redemption schedule.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

Using the Bank's internal credit rating model, the Bank classifies debtors' credit rating into 14 grades (AAA~D). To distinguish the difference between credits in the same grade, the Bank uses 20 stages as auxiliaries to 20 grades.

The Bank's regular credit rating process is carried out once a year and in the case of the change of debtor's credit condition, the credit rating is frequently adjusted as necessary to retain the adequacy of credit rating.

The results of credit rating are applied to various areas such as discrimination of loan processes, loan limit, loan interest rate, post loan management standard process, credit risk measurement, and allowance for loan losses assessment.

*Credit rating process control structure* 

According to the Principle of Checks and Balances, the Bank has established the credit rating process control structure by which the credit rating system operates appropriately.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Independent assessment of credit rating: The Bank's business segment (RM) and credit rating assessment
segment (SRO) are independently operated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Independent control of credit rating system: The control of credit rating system including the development of
credit rating model is independently implemented by the Bank's Risk Management Department.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Independent verification of credit rating system: Credit rating system is independently verified by Risk Validation Team of the Financial Planning Department.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Internal audit of credit rating process: Credit rating process is audited by the Bank's internal audit
department.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Role of the Board of Directors and the Bank's management: Major issues relating to credit process are
approved by the Board of Directors and are regularly monitored by the Bank's top management.

The Bank reviews debt serviceability based on a credit analysis when handling loans. Depending on the results, credit loan preservation is adjusted as necessary using such methods as interest rate preservation due to credit risk.

The Bank evaluates the value of the collateral, performing ability and legal validity of the guarantee at the initial acquisition. The Bank re-evaluates the provided collateral and guarantees regularly for them to be reasonably preserved.

For guarantees, the Bank demands a corresponding written guarantee according to loan handling standards and the guarantor's credit rating is independently calculated when in conformance with the credit rating endowment method.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

The quantification of the extent to which collateral and other credit enhancements mitigate credit risk of impaired financial assets as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  Securities measured at FVOCI | W | 75472 |  | 73063 |
|  Loans measured at amortized cost |  | 2383289 |  | 2663591 |
|  Other assets |  | 7812 |  | 13481 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(iv) *Credit exposure*** 

Geographical information of credit exposure as of December 31, 2024 and 2023 are as follows:

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Korea** | **Korea** | **Hong Kong** | **Ireland** | **Uzbekistan** | **Brazil** | **Hungary** | **UK** | **USA** | **Ohers** | **Total** |
|  Due from banks (excluding due from BOK) | W | 453479 | 1318743 |  | 176400 | 191100 | 715340 | 19911 | 5499422 | 3247842 | 11622237 |
|  Securities measured at FVOCI: |  |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bonds (excluding government bonds) |  | 5930002 | 372498 | 29678 |  |  |  | 706417 | 5949041 | 4118457 | 17106093 |
|  Securities measured at amortized cost: |  |  |  |  |  |  |  |  |  |  |  |
|  Bonds (excluding government bonds) |  | 3560368 |  |  |  |  |  |  | 588959 |  | 4149327 |
|  Loans |  | 159628176 | 1762157 | 2175683 | 545206 | 694285 | 258082 | 1938291 | 12288293 | 51738561 | 231028734 |
|  Derivative financial assets |  | 243449 |  |  |  |  |  | 1230 | 182 | 45981 | 290842 |
|  Other assets |  | 2616174 |  |  |  |  |  |  |  | 5362961 | 7979135 |
|  |  | 172431648 | 3453398 | 2205361 | 721606 | 885385 | 973422 | 2665849 | 24325897 | 64513802 | 272176368 |
|  Guarantees (including financial guarantees) |  | 18357053 | 1085 |  |  |  | 56699 |  | 828844 | 99094 | 19342775 |
|  Commitments |  | 46482058 | 250896 | 66134 |  |  | 21402 | 579201 | 4406682 | 4505948 | 56312321 |
|  |  | 64839111 | 251981 | 66134 |  |  | 78101 | 579201 | 5235526 | 4605042 | 75655096 |
|  | W | 237270759 | 3705379 | 2271495 | 721606 | 885385 | 1051523 | 3245050 | 29561423 | 69118844 | 347831464 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Korea** | **Korea** | **Hong Kong** | **Ireland** | **Uzbekistan** | **Brazil** | **Hungary** | **UK** | **USA** | **Ohers** | **Total** |
|  Due from banks (excluding due from BOK) | W | 138552 | 1346131 |  | 128940 | 104441 | 578910 | 256742 | 2782499 | 1222893 | 6559108 |
|  Securities measured at FVOCI: |  |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bonds (excluding government bonds) |  | 10137604 | 227397 |  |  |  |  | 354937 | 5573303 | 3305218 | 19598459 |
|  Securities measured at amortized cost: |  |  |  |  |  |  |  |  |  |  |  |
|  Bonds (excluding government bonds) |  | 2653129 |  |  |  |  |  |  | 152683 |  | 2805812 |
|  Loans |  | 162410485 | 2068402 | 1942429 | 501707 | 826633 | 1038070 | 1541959 | 7283163 | 45660084 | 223272932 |
|  Derivative financial assets |  | 207334 | 9763 |  |  |  |  | 49559 | 813 | 295027 | 562496 |
|  Other assets |  | 3991060 |  |  |  |  |  |  |  | 6294514 | 10285574 |
|  |  | 179538164 | 3651693 | 1942429 | 630647 | 931074 | 1616980 | 2203197 | 15792461 | 56777736 | 263084381 |
|  Guarantees (including financial guarantees) |  | 17523463 |  |  |  |  | 48997 |  | 743963 | 47967 | 18364390 |
|  Commitments |  | 46663341 | 72725 | 114919 |  | 25788 |  | 313368 | 4155937 | 3470560 | 54816638 |
|  |  | 64186804 | 72725 | 114919 |  | 25788 | 48997 | 313368 | 4899900 | 3518527 | 73181028 |
|  | W | 243724968 | 3724418 | 2057348 | 630647 | 956862 | 1665977 | 2516565 | 20692361 | 60296263 | 336265409 |

---

Industry information of credit exposure as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Manufacturing** | **Manufacturing** | **Service** | **Others** | **Total** |
|  Due from banks (excluding due from BOK) | W |  | 9859582 | 1762655 | 11622237 |
|  Securities measured at FVOCI: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bonds (excluding government bonds) |  | 3096554 | 10493304 | 3516235 | 17106093 |
|  Securities measured at amortized cost: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bonds (excluding government bonds) |  | 847317 | 2337223 | 964787 | 4149327 |
|  Loans |  | 89083417 | 118293797 | 23651520 | 231028734 |
|  Derivative financial assets |  |  | 290842 |  | 290842 |
|  Other assets |  | 257770 | 606725 | 7114640 | 7979135 |
|  | 93285058 | 93285058 | 141881473 | 37009837 | 272176368 |
|  Guarantees (including financial guarantees) |  | 16764602 | 2415561 | 162612 | 19342775 |
|  Commitments |  | 24979628 | 27329872 | 4002821 | 56312321 |
|  | 41744230 | 41744230 | 29745433 | 4165433 | 75655096 |
|  | W135,029,288 | W135,029,288 | 171626906 | 41175270 | 347831464 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Manufacturing** | **Manufacturing** | **Service** | **Others** | **Total** |
|  Due from banks (excluding due from BOK) | W |  | 5814916 | 744192 | 6559108 |
|  Securities measured at FVOCI: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bonds (excluding government bonds) |  | 3403270 | 12644311 | 3550878 | 19598459 |
|  Securities measured at amortized cost: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bonds (excluding government bonds) |  | 369654 | 1673363 | 762795 | 2805812 |
|  Loans |  | 86309450 | 116687925 | 20275557 | 223272932 |
|  Derivative financial assets |  |  | 562496 |  | 562496 |
|  Other assets |  | 308939 | 615661 | 9360974 | 10285574 |
|  | 90391313 | 90391313 | 137998672 | 34694396 | 263084381 |
|  Guarantees (including financial guarantees) |  | 16171129 | 2091952 | 101309 | 18364390 |
|  Commitments |  | 26388986 | 26117146 | 2310506 | 54816638 |
|  | 42560115 | 42560115 | 28209098 | 2411815 | 73181028 |
|  | W132,951,428 | W132,951,428 | 166207770 | 37106211 | 336265409 |

---

Credit exposures of debt securities by credit rating as of December 31, 2024 and 2023 are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
| | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  AAA ~ BBB1 | W | 26273071 | 25861132 | 411939 |  |
|  BBB2 ~ CCC |  | 85000 | 35000 | 50000 |  |
|  Below CC |  |  |  |  |  |
|  | W | 26358071 | 25896132 | 461939 |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
| | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit loss** | **Lifetime expected credit losses** | **Lifetime expected credit losses** |
| | **Carrying<br>amounts** | **Carrying<br>amounts** | **12-month**<br>**expected**<br>**credit loss** | **Non credit-**<br>**impaired** | **Credit-**<br>**impaired** |
|  AAA ~ BBB1 | W | 26723386 | 26383861 | 339525 |  |
|  BBB2 ~ CCC |  | 112869 | 30000 | 82869 |  |
|  Below CC |  |  |  |  |  |
|  | W | 26836255 | 26413861 | 422394 |  |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

***(3) Capital management activities***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Capital adequacy***

The FSS approved the Bank's use of the Foundation Internal Ratings-Based Approach in July 2008. The Bank has been using the same approach when calculating credit risk-weighted assets since the end of June 2008. The equity capital ratio and equity capital according to the standards of the Bank for International Settlements are calculated for such disclosure. The equity capital ratio and equity capital are calculated on a consolidated basis. In conformity with the Banking Act, which is based on the implementation of Basel III on December 1, 2013, the regulatory capital is divided into the following two categories.

***Tier 1 capital***

*- Common Equity Tier 1* 

Regulatory capital that represents the most subordinated claim in liquidation of the Bank, takes the first and proportionately greatest share of any losses as they occur, and which principal is never repaid outside of liquidation meets the criteria for classification as common equity, including capital stock, capital surplus, retained earnings and accumulated other comprehensive income as common equity Tier 1.

*- Additional Tier 1 capital* 

Capital stock and capital surplus related to issuance of capital securities that are subordinated, have non-cumulative and conditional dividends or interests, and have no maturity or step-up conditions.

***Tier 2 capital (Supplementary Tier 2 capital)***

Regulatory capital that fulfills supplementary capital adequacy requirements, and includes subordinated debt with maturities over 5 years and allowance for loan losses in conformity with external regulatory standards and internal standards.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

The BIS capital adequacy ratio and capital in accordance to Basel III standards as of December 31, 2024 and 2023 are as follows:

***BIS capital adequacy ratio***

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Equity capital based on BIS (A): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tier 1 capital: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Common Equity Tier 1 | W | 42581473 | 37417288 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Additional Tier 1 capital |  |  |  |
|  |  | 42581473 | 37417288 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tier 2 capital |  | 3350097 | 3854806 |
|  | W | 45931570 | 41272094 |
|  Risk-weighted assets (\*) (B): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Credit risk-weighted assets | W | 316077185 | 277294329 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Market risk-weighted assets |  | 3246288 | 2895790 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operational risk-weighted assets |  | 11020728 | 13164005 |
|  | W | 330344201 | 293354124 |
|  BIS capital adequacy ratio (\*) (A/B): |  | 13.90% | 14.07% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tier 1 capital ratio: |  | 12.89% | 12.76% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Common Equity Tier 1 ratio |  | 12.89% | 12.76% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Additional Tier 1 capital ratio |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tier 2 capital ratio |  | 1.01% | 1.31% |

---

(\*) The previous period's BIS ratio has been revised due to changes in the methodology for calculating risk-weighted assets.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

***Equity capital based on BIS***

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** |
|  Tier 1 capital (A): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Common Equity Tier 1 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital stock | W | 26316559 | 23926559 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital surplus, etc. |  | 1355849 | 1435780 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Retained earnings |  | 12768402 | 9900499 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accumulated other comprehensive income |  | 2992380 | 3148442 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Common stock deductibles |  | (851717) | (993991) |
|  |  | 42581473 | 37417288 |
|  Tier 2 capital (B): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Allowance for doubtful accounts, etc. |  | 939461 | 955241 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Qualified capital securities |  | 2678000 | 3176000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-qualified capital securities |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Additional stock deductibles |  | (267364) | (276435) |
|  |  | 3350097 | 3854806 |
|  Equity capital (A+B) | W | 45931570 | 41272094 |

---

***(4) Market risk***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Concept***

Market risk is defined as the possibility of potential loss resulting from fluctuations in interest rates, foreign exchange rates and the price of stocks and commodities. Trading position is exposed to risks, such as interest rate, stock price, and foreign exchange rate, etc. Non-trading position is mostly exposed to interest rates. Accordingly, the Bank classifies market risks into those exposed from trading position or those exposed from non-trading position.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Market risks of trading positions***

*Management method on market risks arising from trading positions* 

In response to the full implementation of Basel III market risk regulations, the Bank has been calculating and managing market risk capital in accordance with the Standardized Approach under Basel III since January 2023. The Standardized Approach under Basel III measures market risk by three components: sensitivity risk, default risk and residual risk. Sensitivity risk measures the market risk by five risk classes, which are general interest rate, credit spread, equity, foreign exchange and commodity. Default risk quantifies losses in the event of a default that exceeds normal market price fluctuations. Lastly, residual risk quantifies risk that cannot be measured by sensitivity risk and default risk. These components are then simply added together to calculate the total required capital.

The Bank sets total limit of market risk based on annual business plan, risk appetite and others and monitors Market Risk limit of each trading department on a daily basis.

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

***Capital Requirements for Market risk***

The Bank's Capital Requirements for Market risk as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  Sensitivity risk: |  |  |  |  |
|  General interest rate | W | 94918 |  | 112612 |
|  Credit spread |  | 136309 |  | 84971 |
|  Equity |  | 24 |  | 815 |
|  Foreign exchange (FX) |  | 14186 |  | 8383 |
|  Commodity |  | 555 |  | 120 |
|  |  | 245992 |  | 206901 |
|  Default risk |  | 3296 |  | 7696 |
|  Residual risk |  | 4720 |  | 3901 |
|  | W | 254008 |  | 218498 |

---

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Market risks of non-trading positions***

*Management method on market risks arising from non-trading positions* 

The most critical market risk that arises in non-trading position is the interest rate risk. Interest rate risk is defined as the likely loss resulting from the unfavorable fluctuation of interest rate in the Bank's financial condition and is measured by IRRBB (Interest Rate Risk in Banking Book), ΔEVE (change in Economic Value of Equity) and ΔNII (change in Net Interest Income).

ΔEVE represents fluctuations in the economic value of equity capital that may occur due to changes in interest rates affecting the present values of assets, liabilities and off-balance sheet items. ΔNII represents changes in net interest income that may occur over a certain period of time (e.g. one year) in the future due to changes in interest rates.

The Bank's Risk Management Committee sets and manages interest rate risk limits on a yearly basis and interest rate risk is monthly measured and monitored.

ΔEVE and ΔNII of the Bank's non-trading positions as of December 31, 2024 and 2023 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** |
|  ΔEVE | W | 1584245 |  | 1920912 |
|  ΔNII |  | 551404 |  | 583853 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;***(iv) Foreign currency risk***

Outstanding balances by currency with significant exposure as of December 31, 2024 and 2023 are as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **KRW** | **KRW** | **USD** | **EUR** | **JPY** | **GBP** | **Others** | **Total** |
|  Financial assets: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks | W | 1585770 | 10173373 | 267561 | 100607 | 25041 | 843169 | 12995521 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  | 17551633 | 843635 |  | 2149 |  | 21383 | 18418800 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 20084498 | 11340644 | 562946 | 611946 |  | 160159 | 32760193 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  | 8347345 | 588960 |  |  |  |  | 8936305 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL |  | 419773 |  |  |  |  |  | 419773 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost |  | 135613268 | 63255440 | 4019108 | 3094708 | 1257669 | 2241160 | 209481353 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets |  | 11806992 | 1735394 | 63397 | 9916 | 245797 | 53755 | 13915251 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  | 4371190 | 2311768 | 42597 | 47501 | 3728 | 1021321 | 7798105 |
|  |  | 199780469 | 90249214 | 4955609 | 3866827 | 1532235 | 4340947 | 304725301 |
|  Financial liabilities: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL |  | 2117534 | 271712 |  |  |  |  | 2389246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits |  | 47697961 | 17759643 | 90238 | 500654 | 24 | 52053 | 66100573 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  | 4690210 | 24145429 | 173945 | 2401491 |  | 1319443 | 32730518 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  | 114196967 | 39397041 | 2643535 | 271509 | 543055 | 8050162 | 165102269 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities |  | 11971427 | 2544086 | 50006 | 3689 | 262150 | 42581 | 14873939 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  | 5661685 | 2823530 | 57793 | 44262 | 5256 | 1186239 | 9778765 |
|  |  | 186335784 | 86941441 | 3015517 | 3221605 | 810485 | 10650478 | 290975310 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net financial position | W | 13444685 | 3307773 | 1940092 | 645222 | 721750 | (6309531) | 13749991 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **KRW** | **KRW** | **USD** | **EUR** | **JPY** | **GBP** | **Others** | **Total** |
|  Financial assets: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks | W | 2053194 | 6109070 | 54613 | 88293 | 31063 | 323575 | 8659808 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  | 15369828 | 667073 |  | 2116 |  | 19539 | 16058556 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 23180190 | 9601225 | 76216 | 499704 |  | 530729 | 33888064 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  | 8430505 | 152683 |  |  |  |  | 8583188 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at FVTPL |  | 488432 |  |  |  |  |  | 488432 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans measured at amortized cost |  | 136780322 | 54107004 | 4261084 | 2095045 | 1045941 | 1692384 | 199981780 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial assets |  | 5079144 | 1962602 | 62952 | 15177 | 216238 | 47212 | 7383325 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  | 5805262 | 3051990 | 52799 | 34950 | 2293 | 1189348 | 10136642 |
|  |  | 197186877 | 75651647 | 4507664 | 2735285 | 1295535 | 3802787 | 285179795 |
|  Financial liabilities: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL |  | 1659485 | 260576 |  |  |  |  | 1920061 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits |  | 51240623 | 14219436 | 33889 | 393757 | 185 | 9842 | 65897732 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  | 4817839 | 19649421 | 272211 | 1610656 | 1481 | 1394021 | 27745629 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  | 114993187 | 31115161 | 3206528 | 153390 | 97197 | 7368404 | 156933867 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Derivative financial liabilities |  | 4894577 | 2431566 | 63937 | 7236 | 212812 | 44773 | 7654901 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  | 6848988 | 3508339 | 56519 | 35828 | 1627 | 1371973 | 11823274 |
|  |  | 184454699 | 71184499 | 3633084 | 2200867 | 313302 | 10189013 | 271975464 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net financial position | W | 12732178 | 4467148 | 874580 | 534418 | 982233 | (6386226) | 13204331 |

---

***(5) Liquidity risk management***

&nbsp;&nbsp;&nbsp;&nbsp;***(i) Concept***

Liquidity risk is defined as the possibility of potential loss due to a temporary shortage in funds caused by a maturity mismatch or an unexpected capital outlay. Liquidity risk soars when funding rates rise, assets are sold below a normal price, or a good investment opportunity is missed.

&nbsp;&nbsp;&nbsp;&nbsp;***(ii) Approach to liquidity risk management***

The Bank manages its liquidity risks as follows:

*Allowable limit for liquidity risk* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The allowable limit for liquidity risk sets LCR, NSFR and Mid- to
long-term foreign currency fund management ratio

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The management standards with regards to the allowable limit for liquidity risk should be set using separate and
stringent set ratios in accordance with the FSS guidelines.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• LCR: (High quality liquid assets / Total net cash outflows over the next 30 calendar days) X 100

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• NSFR: Available Stable Funding / Required Stable Funding X 100

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Mid- to long-term foreign currency fund management ratio: Foreign
currency funding being repaid after 1 year / Foreign currency lending being collected after 1 year X 100

*Early warning indicator* 

To identify prematurely and cope with worsening liquidity risk trends, the Bank has set up 15 indexes such as the "Foreign Exchange Stabilization Bond CDS Premium," and measures the trend monthly as a means for establishing the allowable liquidity risk limit complementary measures.

*Stress-Test analysis and contingency plan* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank evaluates the effects on the liquidity risk and identifies the inherent flaws. In the case where an
unpredictable and significant liquidity crisis occurs, the Bank executes risk situation analysis quarterly based on crisis specific to the Bank, market risk and complex emergency, and reports to the Risk Management Committee for the Bank's
solvency securitization.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank established detailed contingency plan to manage the liquidity risks at every risk situations.

&nbsp;&nbsp;&nbsp;&nbsp;***(iii) Analysis on remaining contractual maturity of financial instruments***

Remaining contractual maturity analysis of non-derivative financial instruments including interest payment as of December 31, 2024 and 2023 are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Within 1 month** | **Within 1 month** | **1~3 months** | **3~12 months** | **1~5 years** | **Over 5 years** | **Total** |
|  Financial assets: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks | W | 9972375 | 503873 | 1547894 | 924609 |  | 12948751 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  | 46600 | 44229 | 1366748 | 189953 | 16741203 | 18388733 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 826144 | 915551 | 3345316 | 9961875 | 16773121 | 31822007 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  | 115000 | 811131 | 3340174 | 4649715 | 30000 | 8946020 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans |  | 14624020 | 22345767 | 75308653 | 74886373 | 21375761 | 208540574 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  | 6105756 |  |  |  | 1812957 | 7918713 |
|  | W | 31689895 | 24620551 | 84908785 | 90612525 | 56733042 | 288564798 |
|  Financial liabilities: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL | W | 692242 | 177967 | 845385 | 401940 | 271712 | 2389246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits |  | 26721259 | 14853061 | 19694387 | 4812941 | 494 | 66082142 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  | 6497080 | 9373391 | 9491425 | 6268523 | 774520 | 32404939 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  | 7190293 | 9981850 | 51813957 | 88861601 | 8010418 | 165858119 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  | 5725726 | 2996849 |  |  | 5921914 | 14644489 |
|  | W | 46826600 | 37383118 | 81845154 | 100345005 | 14979058 | 281378935 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Within 1 month** | **Within 1 month** | **1~3 months** | **3~12 months** | **1~5 years** | **Over 5 years** | **Total** |
|  Financial assets: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and due from banks | W | 6496029 | 435423 | 1052742 | 675016 |  | 8659210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVTPL |  | 148946 | 183900 | 1240381 | 357045 | 14108295 | 16038567 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at FVOCI |  | 993549 | 818347 | 4937042 | 9576173 | 15126966 | 31452077 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Securities measured at amortized cost |  | 329935 | 648441 | 3341184 | 4242848 | 30000 | 8592408 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans |  | 14612469 | 18283041 | 70764523 | 77534031 | 18136771 | 199330835 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial assets |  | 8432805 |  |  |  | 1773897 | 10206702 |
|  | W | 31013733 | 20369152 | 81335872 | 92385113 | 49175929 | 274279799 |
|  Financial liabilities: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial liabilities measured at FVTPL | W | 472317 | 156783 | 447317 | 583068 | 260576 | 1920061 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits |  | 27470945 | 11085432 | 20825008 | 6400963 | 128990 | 65911338 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  | 4644515 | 5118500 | 11503777 | 5421288 | 840401 | 27528481 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debentures |  | 5640391 | 8903959 | 48962250 | 86164795 | 7795760 | 157467155 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other financial liabilities |  | 8439585 | 2664173 |  |  | 5703816 | 16807574 |
|  | W | 46667753 | 27928847 | 81738352 | 98570114 | 14729543 | 269634609 |

---

Remaining contractual maturity analysis of derivative financial instruments as of December 31, 2024 and 2023 are as follows:

*Net settlement of derivative financial instruments* 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Within 1 month** | **Within 1 month** | **1~3 months** | **3~12 months** | **1~5 years** | **Over 5 years** | **Total** |
|  Trading purpose derivatives: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency | W | 3724 |  |  |  |  | 3724 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate |  | 55197 | 30315 | (325391) | (394347) | 1079448 | 445222 |
|  Hedging purpose derivatives: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate |  | 36090 | 250330 | 841971 | 2130959 | 1295726 | 4555076 |
|  | W | 95011 | 280645 | 516580 | 1736612 | 2375174 | 5004022 |

---

------

##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Within 1 month** | **Within 1 month** | **1~3 months** | **3~12 months** | **1~5 years** | **Over 5 years** | **Total** |
|  Trading purpose derivatives: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency | W | (2033) | (28349) | (275111) | (366676) | 826714 | 154545 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate |  | (1) |  |  |  |  | (1) |
|  Hedging purpose derivatives: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate |  | 43722 | 144662 | 543394 | 1595618 | 1336540 | 3663936 |
|  | W | 41688 | 116313 | 268283 | 1228942 | 2163254 | 3818480 |

---

*Gross settlement of derivative financial instruments* 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Within 1 month** | **Within 1 month** | **1~3 months** | **3~12 months** | **1~5 years** | **Over 5 years** | **Total** |
|  Trading purpose derivatives: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inflow | W | 67582388 | 38553043 | 66563517 | 122988092 | 6762347 | 302449387 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Outflow |  | 67425405 | 38576699 | 66061685 | 122136515 | 6868720 | 301069024 |
|  Hedging purpose derivatives: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inflow |  | 1258709 | 1810835 | 3446653 | 19785824 | 4827947 | 31129968 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Outflow |  | 1542826 | 1787625 | 3950032 | 22008513 | 4721907 | 34010903 |
|  Total inflow | W | 68841097 | 40363878 | 70010170 | 142773916 | 11590294 | 333579355 |
|  Total outflow | W | 68968231 | 40364324 | 70011717 | 144145028 | 11590627 | 335079927 |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Within 1 month** | **Within 1 month** | **1~3 months** | **3~12 months** | **1~5 years** | **Over 5 years** | **Total** |
|  Trading purpose derivatives: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inflow | W | 45348884 | 27478545 | 57355351 | 87467138 | 5566523 | 223216441 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Outflow |  | 45470176 | 27330617 | 56975759 | 86723581 | 5583057 | 222083190 |
|  Hedging purpose derivatives: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inflow |  | 1581339 | 714124 | 5614897 | 17506798 | 4659118 | 30076276 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Outflow |  | 1828956 | 1245814 | 5799883 | 17135514 | 4444721 | 30454888 |
|  Total inflow | W | 46930223 | 28192669 | 62970248 | 104973936 | 10225641 | 253292717 |
|  Total outflow | W | 47299132 | 28576431 | 62775642 | 103859095 | 10027778 | 252538078 |

---

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##### [**Table of Contents**](#toc)
**Korea Development Bank** 

**Notes to the Separate Financial Statements** 

**December 31, 2024 and 2023** 

**(In millions of won)** 

**48. <u>Risk Management, Continued</u>**

Remaining contractual maturity analysis of guarantees and commitments as of December 31, 2024 and 2023 are as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Within 1 month** | **Within 1 month** | **1~3 months** | **3~12 months** | **1~5 years** | **Over 5 years** | **Total** |
|  Guarantees | W | 2224092 | 2203315 | 3958687 | 10308705 | 647976 | 19342775 |
|  Commitments |  | 74400 | 138142 | 1440012 | 2535934 | 63501419 | 67689907 |
|  | W | 2298492 | 2341457 | 5398699 | 12844639 | 64149395 | 87032682 |
|  | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** | **December 31, 2023** |
|  | **Within 1 month** | **Within 1 month** | **1~3 months** | **3~12 months** | **1~5 years** | **Over 5 years** | **Total** |
|  Guarantees | W | 1210778 | 2221822 | 5049000 | 9253213 | 629577 | 18364390 |
|  Commitments |  | 282001 | 103672 | 1586296 | 1763658 | 53127394 | 56863021 |
|  | W | 1492779 | 2325494 | 6635296 | 11016871 | 53756971 | 75227411 |

---

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##### [**Table of Contents**](#toc)
**THE REPUBLIC OF KOREA** 

**Land and History** 

***Territory and Population***

Located generally south of the 38th parallel on the Korean peninsula, The Republic of Korea covers about 38,000 square miles, approximately one-fourth of which is arable. The Republic has a population of approximately 52 million people. The country's largest city and capital, Seoul, has a population of about 9 million people.

***Map of the Republic of Korea***

![LOGO](g82964g01g42.jpg)

***Political History***

Dr. Rhee Seungman, who was elected President in each of 1948, 1952, 1956 and 1960, dominated the years after the Republic's founding in 1948. Shortly after President Rhee's resignation in 1960 in response to student-led demonstrations, a group of military leaders headed by Park Chung Hee assumed power by coup. The military leaders established a civilian government, and the country elected Mr. Park as President in October 1963. President Park served as President until his assassination in 1979 following a period of increasing strife between the Government and its critics. The Government declared martial law and formed an interim

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government under Prime Minister Choi Kyu Hah, who became the next President. After clashes between the Government and its critics, President Choi resigned, and General Chun Doo Hwan, who took control of the Korean army, became President in 1980.

In late 1980, the country approved, by national referendum, a new Constitution, providing for indirect election of the President by an electoral college and for certain democratic reforms, and shortly thereafter, in early 1981, re-elected President Chun.

Responding to public demonstrations in 1987, the legislature revised the Constitution to provide for direct election of the President. In December 1987, Roh Tae Woo won the presidency by a narrow plurality, after opposition parties led by Kim Young Sam and Kim Dae Jung failed to unite behind a single candidate. In February 1990, two opposition political parties, including the one led by Kim Young Sam, merged into President Roh's ruling Democratic Liberal Party.

In December 1992, the country elected Kim Young Sam as President. The election of a civilian and former opposition party leader considerably lessened the controversy concerning the legitimacy of the political regime. President Kim's administration reformed the political sector and deregulated and internationalized the Korean economy.

In December 1997, the country elected Kim Dae Jung as President. President Kim's party, the Millennium Democratic Party (formerly known as the National Congress for New Politics), formed a coalition with the United Liberal Democrats led by Kim Jong Pil, with Kim Jong Pil becoming the first prime minister in President Kim's administration. The coalition, which temporarily ended before the election held in April 2000, continued with the appointment of Lee Han Dong of the United Liberal Democrats as the Prime Minister in June 2000. The coalition again ended in September 2001.

In December 2002, the country elected Roh Moo Hyun as President. President Roh and his supporters left the Millennium Democratic Party in 2003 and formed a new party, the Uri Party, in November 2003. On August 15, 2007, 85 members of the National Assembly, previously belonging to the Uri Party, or the Democratic Party, formed the United New Democratic Party, or the UNDP. The Uri Party merged into the UNDP on August 20, 2007. In February 2008, the UNDP merged back into the Democratic Party. In December 2011, the Democratic Party merged with the Citizens Unity Party to form the Democratic United Party, which changed its name to the Democratic Party in May 2013.

In December 2007, the country elected Lee Myung-Bak as President. He commenced his term in February 2008. In April 2018, the Korean prosecutor's office indicted former President Lee on 16 counts of corruption, including bribery, abuse of power, embezzlement and other irregularities. In October 2018, a Seoul district court sentenced him to 15 years of prison term, which decision he subsequently appealed. In October 2020, the Supreme Court ruled against such appeal and sentenced him to 17 years of prison term. Subsequently, he was released from prison pursuant to a special presidential pardon in December 2022.

In December 2012, the country elected Park Geun-hye as President. She commenced her term in February 2013. In March 2017, the Constitutional Court unanimously upheld a parliamentary vote to impeach President Park, triggering her immediate dismissal, for a number of constitutional and criminal violations, including violation of the Constitution and abuse of power by allowing her confidant to exert influence on state affairs and allowing senior presidential aides to aid in her extortion from companies. After a series of trials, former President Park was sentenced to a combined 22 years of prison term and a fine of W21.5 billion. In light of her deteriorating health, however, former President Park was granted a special pardon by President Moon, her successor, and was released from prison in December 2021.

A special election to elect a successor to former President Park was held in May 2017 and the country elected Moon Jae-in as President. His term, which commenced on May 10, 2017, ended on May 9, 2022.

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In March 2022, the country elected Yoon Suk-yeol as President. His term commenced on May 10, 2022. On December 3, 2024, President Yoon declared martial law, citing an urgent need to protect the country. The National Assembly swiftly voted to rescind the declaration of martial law, which led to President Yoon's revocation of the decree hours later. On December 14, 2024, the National Assembly voted in favor of President Yoon's impeachment, for his purported acts of insurrection, among others, which resulted in an immediate suspension of his presidential powers, with the prime minister simultaneously taking over the role of acting President. These events have prompted numerous ongoing public protests, both against and in support of President Yoon. On April 4, 2025, the Constitutional Court unanimously upheld the National Assembly's vote to impeach President Yoon, triggering his immediate dismissal, with a special election to elect a new President to be held on June 3, 2025. Although the Government believes that the Korean economy and society are resilient enough to withstand any temporary negative impact of such political developments or any potential ensuing societal unrest, there is no assurance that such developments would not have a material adverse effect on the Korean economy and public finances.

**Government and Politics** 

***Government and Administrative Structure***

Governmental authority in the Republic is centralized and concentrated in a strong presidency. The President is elected by popular vote and can only serve one term of five years. The President chairs the State Council, which consists of the President, the prime minister, the deputy prime ministers, the respective heads of Government ministries and the ministers of state. The President can select the members of the State Council and appoint or remove all other Government officials, except for elected local officials.

The President can veto new legislation and take emergency measures in cases of natural disaster, serious fiscal or economic crisis, state of war or other similar circumstances. The President must promptly seek the concurrence of the National Assembly for any emergency measures taken and failing to do so automatically invalidates the emergency measures. In the case of martial law, the President may declare martial law without the consent of the National Assembly; provided, however, that the National Assembly may request the President to rescind such martial law.

The National Assembly exercises the country's legislative power. The Constitution and the Public Official Election Act provide for the direct election of about 84% of the members of the National Assembly and the distribution of the remaining seats proportionately among parties winning more than five seats in the direct election or receiving over 3% of the popular vote. National Assembly members serve four-year terms. The National Assembly enacts laws, ratifies treaties and approves the national budget. The executive branch drafts most legislation and submits it to the National Assembly for approval.

The country's judicial branch comprises the Supreme Court, the Constitutional Court and lower courts of various levels. The President appoints the Chief Justice of the Supreme Court and appoints the other Justices of the Supreme Court upon the recommendation of the Chief Justice. All appointments to the Supreme Court require the consent of the National Assembly. The Chief Justice, with the consent of the conference of Supreme Court Justices, appoints all the other judges in Korea. Supreme Court Justices serve for six years and all other judges serve for ten years. Other than the Chief Justice, justices and judges may be reappointed to successive terms.

The President formally appoints all nine judges of the Constitutional Court, but three judges must be designated by the National Assembly and three by the Chief Justice of the Supreme Court. Constitutional Court judges serve for six years and may be reappointed to successive terms.

Administratively, the Republic comprises six provinces (Gyeonggi, Chungbuk, Chungnam, Jeonnam, Gyeongbuk and Gyeongnam), three special autonomous provinces (Jeju, Gangwon and Jeonbuk), one special city

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(Seoul), six metropolitan cities (Busan, Daegu, Incheon, Gwangju, Daejeon and Ulsan) and one special autonomous city (Sejong). From 1961 to 1995, the national government controlled the provinces and the President appointed provincial officials. Local autonomy, including the election of provincial officials, was reintroduced in June 1995.

***Political Parties***

The 22nd legislative general election was held on April 10, 2024 and the term of the National Assembly members elected in the 22nd legislative general election commenced on May 30, 2024. Currently, there are three major political parties: The Democratic Party of Korea, or the DPK, the People Power Party, or the PPP, and the Rebuilding Korea Party, or the RKP.

As of March 31, 2025, the parties control the following number of seats in the National Assembly:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **DPK** | **PPP** | **RKP** | **Others** | **Total** |
|  Number of seats | 170 | 108 | 12 | 10 | 300 |

---

***Relations with North Korea***

Relations between the Republic and North Korea have been tense over most of the Republic's history. The Korean War began with the invasion of the Republic by communist forces from the north in 1950, which was repelled by the Republic and the United Nations forces led by the United States. Following a military stalemate, an armistice was reached establishing a demilitarized zone monitored by the United Nations in the vicinity of the 38th parallel in 1953.

North Korea maintains a military force estimated at more than a million regular troops, mostly concentrated near the northern side of the demilitarized zone, and approximately 7.6 million reserves. The Republic's military forces, composed of approximately 500,000 regular troops and 3.1 million reserves, maintain a state of military preparedness along the southern side of the demilitarized zone. In addition, the United States has maintained its military presence in the Republic since the signing of the armistice and currently has approximately 28,500 troops stationed in the Republic. The Republic and the United States share a joint command structure over their military forces in Korea. In October 2014, the United States and the Republic agreed to implement a conditions-based approach to the dissolution of their joint command structure at an appropriate future date, which would allow the Republic to assume the command of its own armed forces in the event of war on the Korean peninsula. Over the years, the Republic and the United States have entered into a series of Special Measures Agreements, or SMAs, which cover the Republic's contribution to the cost of maintaining the U.S. military presence in the Republic. In March 2021, the Republic and the United States reached an agreement to enter into a new six-year SMA, under which the Republic would increase its share of the cost of the American military presence in the Republic, which became effective in September 2021 upon ratification by the National Assembly.

The level of tension between the two Koreas has fluctuated and may increase abruptly as a result of current and future events. In particular, since the death of Kim Jong-il in December 2011, there has been increased uncertainty with respect to the future of North Korea's political leadership and concern regarding its implications for political and economic stability in the region. Kim Jong-il's third son, Kim Jong-un, has assumed power as his father's designated successor.

In addition, there have been heightened security concerns in recent years stemming from North Korea's nuclear weapons, ballistic missile and satellite programs as well as its hostile military and other actions against Korea. Some of the significant incidents in recent years include the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• From time to time, North Korea has conducted ballistic missile tests. In February 2016, North Korea launched
a long-range rocket in violation of its agreement with the United States as well as United

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Nations sanctions barring it from conducting launches that use ballistic missile technology. Despite international condemnation, North Korea released a statement that it intends to continue its rocket launch program and it conducted a series of ballistic missile tests in 2016 and 2017. In response, the United Nations Security Council issued unanimous statements condemning North Korea and agreeing to continue to closely monitor the situation and to take further significant measures, and in December 2017, unanimously passed a resolution extending existing sanctions that were imposed on North Korea. Despite such actions, North Korea increased the frequency of its military actions since the beginning of 2022, firing numerous ballistic missiles, including intercontinental ballistic missiles, and in November 2023, successfully launched its first spy satellite. <br>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• North Korea renounced its obligations under the Nuclear Non-Proliferation Treaty in January 2003 and conducted three rounds of nuclear tests between October 2006 and February 2013. In January 2016, North Korea conducted a fourth nuclear test, claiming that the test involved its first hydrogen bomb. In
September 2016, North Korea conducted a fifth nuclear test, claiming to have successfully detonated a nuclear warhead that could be mounted on ballistic missiles. In September 2017, North Korea announced that it successfully conducted its sixth
nuclear test by detonating a hydrogen bomb designed to be mounted on an intercontinental ballistic missile, which resulted in increased tensions in the region and elicited strong objections worldwide. In response to such tests (as well as North
Korea's long-range ballistic missile program), the United Nations Security Council unanimously passed several rounds of resolutions condemning North Korea's actions and significantly expanding the scope of the sanctions applicable to
North Korea, while the United States and the European Union also imposed additional sanctions on North Korea.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In August 2015, two Korean soldiers were injured in a landmine explosion near the Korean demilitarized zone.
Claiming the landmines were set by North Koreans, the Korean army re-initiated its propaganda program toward North Korea utilizing loudspeakers near the demilitarized zone. In retaliation, the North Korean
army fired artillery rounds on the loudspeakers, resulting in the highest level of military readiness for both Koreas.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In March 2010, a Korean naval vessel was destroyed by an underwater explosion, killing many of the crewmen
on board. The Government formally accused North Korea of causing the sinking, while North Korea denied responsibility. Moreover, in November 2010, North Korea fired more than one hundred artillery shells that hit Korea's Yeonpyeong
Island near the Northern Limit Line, which acts as the de facto maritime boundary between Korea and North Korea on the west coast of the Korean peninsula, causing casualties and significant property damage. The Government condemned North Korea
for the attack and vowed stern retaliation should there be further provocation.

North Korea's economy also faces severe challenges, which may further aggravate social and political pressures within North Korea. Although bilateral summit meetings were held between Korea and North Korea in April, May and September 2018 and between the United States and North Korea in June 2018, February 2019 and June 2019, there can be no assurance that the level of tension on the Korean peninsula will not escalate in the future or that such escalation will not have a material adverse impact on the Republic's economy and us. Any further increase in tension, which may occur, for example, if North Korea experiences a leadership crisis, high-level contacts between the Republic and North Korea or between the United States and North Korea break down or further military hostilities occur, could have a material adverse effect on the Republic's economy and us. Over the longer term, reunification of the two Koreas could occur. Reunification may entail a significant economic commitment by the Republic.

***Foreign Relations and International Organizations***

The Republic maintains diplomatic relations with most nations of the world, most importantly with the United States with which it entered into a mutual defense treaty and several economic agreements. The Republic also has important relationships with Japan and China, its largest trading partners together with the United States.

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The Republic belongs to a number of supranational organizations, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• United Nations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the International Monetary Fund, or the IMF;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the World Bank;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Asian Development Bank, or the ADB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Multilateral Investment Guarantee Agency;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the International Finance Corporation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the International Development Association;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the African Development Bank;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the International Bank for Reconstruction and Development;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the European Bank for Reconstruction and Development;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Bank for International Settlements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the World Health Organization, or the WHO;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the World Trade Organization, or the WTO;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the International Atomic Energy Agency, or the IAEA;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Inter-American Development Bank, or the IDB;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Organization for Economic Cooperation and Development, or the OECD; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Asian Infrastructure Investment Bank.

**The Economy** 

The following table sets forth information regarding certain of the Republic's key economic indicators for the periods indicated.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **As of or for the year ended December 31,** | **As of or for the year ended December 31,** | **As of or for the year ended December 31,** | **As of or for the year ended December 31,** | **As of or for the year ended December 31,** |
|  | **2020** | **2021** | **2022** | **2023** | **2024** |
|  | **(billions of dollars and trillions of Won, except percentages)** | **(billions of dollars and trillions of Won, except percentages)** | **(billions of dollars and trillions of Won, except percentages)** | **(billions of dollars and trillions of Won, except percentages)** | **(billions of dollars and trillions of Won, except percentages)** |
|  GDP Growth (at current prices) | 0.9% | 7.9% | 4.6% | 3.3% | 6.2%<sup>(7)</sup> |
|  GDP Growth (at chained 2020 year prices) | (0.7)% | 4.6% | 2.7% | 1.4% | 2.0%<sup>(7)</sup> |
|  Inflation<sup>(1)</sup> | 0.5% | 2.5% | 5.1% | 3.6% | 2.3%<sup>(7)</sup> |
|  Unemployment<sup>(2)</sup> | 4.0% | 3.7% | 2.9% | 2.7% | 2.8%<sup>(7)</sup> |
|  Trade Surplus (Deficit)<sup>(3)</sup> | $44.9 | $29.3 | $(47.8) | $(10.4) | $51.6<sup>(7)</sup> |
|  Foreign Currency Reserves | $443.1 | $463.1 | $423.2 | $420.1 | $415.6 |
|  External Liabilities<sup>(4)</sup> | $550.6 | $630.7 | $673.3 | $672.5 | $670.0<sup>(7)</sup> |
|  Fiscal Balance | (71.2) | (30.5) | (64.6) | (36.8) | (43.5)<sup>(7)</sup> |
|  Direct Internal Debt of the Government<sup>(5)</sup> (as % of GDP<sup>(6)</sup>) | 39.3% | 43.1% | 46.2% | 48.2% | N/A<sup>(8)</sup> |
|  Direct External Debt of the Government<sup>(5)</sup> (as % of GDP<sup>(6)</sup>) | 0.5% | 0.5% | 0.5% | 0.5% | N/A<sup>(8)</sup> |

---

(1) Measured by the year-on-year change in the consumer price index with base year 2020, as announced by The Bank of Korea.

(2) Average for year.

(3) Derived from customs clearance statistics on a C.I.F. basis, meaning that the price of goods includes insurance
and freight cost.

(4) Calculated under the criteria based on the sixth edition of the Balance of Payment Manual published by the
International Monetary Fund in December 2010.

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(5) Does not include guarantees by the Government. See "—Debt—External and Internal Debt of the
Government—Guarantees by the Government" for information on outstanding guarantees by the Government.

(6) At chained 2020 year prices.

(7) Preliminary.

(8) Not available.

*Source:* The Bank of Korea

***Worldwide Economic and Financial Difficulties***

In recent years, the global financial markets have experienced significant volatility as a result of, among other things:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the occurrence of severe health epidemics, including the COVID-19 pandemic;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• hostilities, political or social tensions involving Russia (including the Russia-Ukraine war and ensuing actions
that the United States and other countries have taken or may take in the future, such as the imposition of sanctions against Russia) and the resulting adverse effects on the global supply of oil and other natural resources and the global financial
markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• rising inflationary pressures leading to increases in the costs of goods and services and a decrease in
purchasing power;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• interest rate fluctuations as well as perceived or actual changes in policy rates, or other monetary and fiscal
policies set forth, by the U.S. Federal Reserve and other central banks;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• disruptions in the global supply chain for raw materials, natural resources, consumer goods, rare earth minerals,
component parts and other supplies, including as a result of health epidemics, government policies and labor shortages;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• increased uncertainties in the global financial markets and industry, including difficulties faced by several
banks in the United States and Europe;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a deterioration in economic and trade relations between the United States and its trading partners, including as
a result of the imposition of significant tariffs by the United States on its trading partners;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• financial and social difficulties affecting many governments worldwide, in particular in Latin America and
Europe;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• escalations in trade protectionism globally and geopolitical tensions in East Asia and the Middle East (including
those resulting from the escalating hostilities in the Middle East following the Israel-Hamas war);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the slowdown of economic growth in China and other major emerging market economies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• political and social instability in various countries in the Middle East, including Iran, Iraq, Syria and Yemen;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• fluctuations in oil and commodity prices.

There has been significant volatility in global financial markets resulting from, among others, the COVID-19 pandemic, the Russia-Ukraine war and ensuing sanctions against Russia, the escalating hostilities in the Middle East following the Israel-Hamas war, difficulties faced by several banks in the United States and Europe and significant fluctuations in policy interest rates globally, which has also led to significant volatility in the Korea Composite Stock Price Index in recent years. See "—The Financial System—Securities Markets". Declines in the index and large amounts of sales of Korean securities by foreign investors and subsequent repatriation of the proceeds of such sales may adversely affect the value of the Won, the foreign currency reserves held by financial institutions in Korea, and the ability of Korean companies and banks to raise capital. Moreover, the value of the Won relative to major foreign currencies in general and the U.S. dollar in particular

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has depreciated significantly in recent years. A depreciation of the Won generally increases the cost of imported goods and services and the required amount of the Won revenue for Korean companies to service foreign currency-denominated debt.

In light of the high level of interdependence of the global economy, any of the foregoing developments could have a material adverse effect on the Korean economy and financial markets. In addition, in the event of difficult conditions in the global credit markets or a deterioration of the global economy in the future, the Korean economy could be adversely affected and Korean banks may be forced to fund their operations at a higher cost or may be unable to raise as much funding as they need to support their lending and other activities.

In addition to the global developments, domestic developments that could lead to or contribute to a material adverse effect on the Korean economy include, among other things, the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a slowdown in consumer spending and depressed consumer sentiment due to the outbreak of infectious diseases, such
as the COVID-19 pandemic;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• increasing delinquencies and credit defaults by consumer and small- and medium-sized enterprise borrowers, which may occur due to, among others, higher levels of market interest rates;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• steadily rising household debt consisting of housing loans and merchandise credit, which increased to
approximately Won 1,927.3 trillion as of December 31, 2024 from Won 843.2 trillion as of December 31, 2010, primarily due to increases in mortgage loans and purchases with credit cards;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• deterioration in economic or diplomatic relations between Korea and other countries resulting from territorial or
trade disputes or disagreements in foreign policy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a substantial increase in the Government's expenditures for pension and social welfare programs, due in
part to an aging population (defined as the population of people aged 65 years or older) that accounted for approximately 19.2% of the Republic's total population as of December 31, 2024, an increase from 7.2% as of December 31,
2000, and is expected to surpass 22.5% in 2027;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• decreases in the market prices of Korean real estate; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the occurrence of severe health epidemics that affect the livestock industry.

***Gross Domestic Product***

GDP measures the market value of all final goods and services produced within a country for a given period and reveals whether a country's productive output rises or falls over time. Economists present GDP in both current market prices and "real" or "inflation-adjusted" terms. In March 2009, the Republic adopted a method known as the "chain-linked" measure of GDP, replacing the previous fixed-base, or "constant" measure of GDP, to show the real growth of the aggregate economic activity, as recommended by the System of National Accounts 1993. GDP at current market prices values a country's output using the actual prices of each year, whereas the "chain-linked" measure of GDP is compiled by using "chained indices" linking volume growth between consecutive time periods. In March 2014, the Republic published a revised GDP calculation method by implementing the System of National Accounts 2008 and updating the reference year from 2005 to 2010 to align Korean national accounts statistics with the recommendations of the new international standards for compiling national economic accounts and to maintain comparability with other nations' accounts. The main components of these revisions include, among other things, (i) recognizing expenditures for research and development and creative activity for the products of entertainment, literary and artistic originals as fixed investment, (ii) incorporating a wide array of new and revised source data such as the economic census, the population and housing census and 2010 benchmark input-output tables, which provide thorough and detailed information on the structure of the Korean economy, (iii) developing supply-use tables, which provide a statistical tool for ensuring consistency among the production, expenditure and income approaches to measuring GDP and (iv) recording merchandise trade transactions based on ownership changes rather than movements of goods across the national

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border. The Republic updated the reference year from 2010 to 2015 in July 2019, and from 2015 to 2020 in June 2024, to better align Korean national accounts statistics with the recommendations of the previously implemented System of National Accounts 2008, to accurately reflect recent economic structural changes, and to maintain comparability with other countries' accounts.

The following table sets out the composition of the Republic's GDP at current market and chained 2020 year prices and the annual average increase in the Republic's GDP.

**Gross Domestic Product** 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024<sup>(1)</sup>** | **As % of GDP<br>2024<sup>(1)</sup>** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  **Gross Domestic Product at Current Market Prices:** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Private | 984088.0 | 1046772.2 | 1139397.2 | 1197566.9 | 1235320.5 | 48.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government | 349586.2 | 378268.2 | 409866.5 | 423133.2 | 439502.7 | 17.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gross Capital Formation | 648928.8 | 721964.5 | 774411.5 | 774563.6 | 774314.5 | 30.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exports of Goods and Services | 712542.3 | 874074.3 | 1052553.6 | 996865.6 | 1137666.2 | 44.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less Imports of Goods and Services | (636678.7) | (799166.2) | (1052447.3) | (990452.9) | (1036361.5) | (40.7) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Statistical Discrepancy | 0.0 | 0.0 | 0.0 | (487.1) | (1321.8) | (0.1) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Expenditures on Gross Domestic Product | 2058466.5 | 2221912.9 | 2323781.5 | 2401189.4 | 2549120.7 | 100.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net Factor Income from the Rest of the World | 16943.8 | 23413.6 | 28055.4 | 42128.6 | 36081.9 | 1.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gross National Income<sup>(2)</sup> | 2075410.3 | 2245326.5 | 2351837.0 | 2443318.1 | 2585202.6 | 101.4 |
|  **Gross Domestic Product at Chained 2020 Year Prices:** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Private | 984088.0 | 1020878.4 | 1063928.5 | 1082682.9 | 1095010.1 | 47.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Government | 349586.2 | 369293.7 | 384235.8 | 389091.8 | 395805.2 | 17.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gross Capital Formation | 648928.8 | 675845.0 | 676282.5 | 681957.7 | 667836.6 | 29.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exports of Goods and Services | 712542.3 | 789432.2 | 820347.6 | 849926.1 | 908291.6 | 39.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less Imports of Goods and Services | (636678.7) | (701537.0) | (730672.0) | (756395.9) | (774842.5) | (33.9) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Statistical Discrepancy | 0.0 | (489.4) | (842.9) | (886.5) | (1154.6) | (0.1) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Expenditures on Gross Domestic Product<sup>(3)</sup> | 2058466.5 | 2153422.9 | 2212158.9 | 2243220.4 | 2288923.2 | 100.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net Factor Income from the Rest of the World in the Terms of Trade | 16943.8 | 22553.7 | 25584.2 | 38122.9 | 31641.7 | 1.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Trading Gains and Losses from Changes in the Terms of Trade | 0.0 | (21620.0) | (94623.4) | (91400.4) | (53939.1) | (2.4) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gross National Income<sup>(4)</sup> | 2075410.3 | 2154356.5 | 2143107.5 | 2189886.8 | 2267167.8 | 99.0 |
|  Percentage Increase (Decrease) of GDP over Previous Year: |  |  |  |  |  |  |
|  At Current Prices | 0.9 | 7.9 | 4.6 | 3.3 | 6.2 |  |
|  At Chained 2020 Year Prices | (0.7) | 4.6 | 2.7 | 1.4 | 2.0 |  |

---

(1) Preliminary.

(2) GDP plus net factor income from the rest of the world is equal to the Republic's gross national income.

(3) Under the "chain-linked" measure of GDP, the components of GDP will not necessarily add up to the
total GDP.

(4) Under the "chain-linked" measure of Gross National Income, the components of Gross National Income
will not necessarily add up to the total Gross National Income.

*Source:* The Bank of Korea

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##### [**Table of Contents**](#toc)
The following table sets out the Republic's GDP by economic sector at current market prices:

**Gross Domestic Product by Economic Sector** 

**(at current market prices)** 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024<sup>(1)</sup>** | **As % of GDP<br>2024<sup>(1)</sup>** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Industrial Sectors: | 719110.4 | 773620.4 | 789147.0 | 824491.9 | 913410.5 | 35.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Agriculture, Forestry and Fishing | 32481.6 | 36998.4 | 33656.4 | 34325.0 | 37005.4 | 1.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Manufacturing, Mining and Quarrying | 530768.1 | 585053.1 | 617557.4 | 617134.7 | 686690.3 | 26.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mining and Quarrying | 1737.2 | 1843.5 | 1807.8 | 2261.3 | 2091.1 | 0.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Manufacturing | 529030.9 | 583209.6 | 615749.6 | 614873.4 | 684599.2 | 26.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electricity, Gas and Water Supply | 45605.3 | 37579.5 | 16493.8 | 42538.6 | 60363.7 | 2.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Construction | 110255.4 | 113989.4 | 121439.4 | 130493.6 | 129351.1 | 5.1 |
|  Services: | 1171665.8 | 1264275.9 | 1349454.4 | 1405368.8 | 1455704.3 | 57.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Wholesale and Retail Trade, Accommodation and Food Services | 214871.3 | 227253.6 | 248366.2 | 265510.1 | 271703.1 | 10.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transportation and Storage | 66603.8 | 82702.3 | 95655.6 | 94378.8 | 98714.3 | 3.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Finance and Insurance | 110016.4 | 124021.2 | 136404.4 | 138566.4 | 139357.4 | 5.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Real Estate | 161030.1 | 162658.9 | 158314.6 | 160025.3 | 167658.9 | 6.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Information and Communication | 89215.3 | 102319.0 | 103549.3 | 106049.4 | 110709.9 | 4.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Business Activities | 156652.6 | 166098.7 | 177636.8 | 186753.6 | 191780.1 | 7.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Public Administration, Defense and Social Security | 129850.9 | 138688.7 | 149078.6 | 155208.6 | 162164.1 | 6.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Education | 90436.1 | 96862.5 | 101581.8 | 103917.0 | 106793.9 | 4.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Human Health and Social Work | 106034.6 | 114340.0 | 123519.0 | 131995.9 | 139720.3 | 5.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cultural and Other Services | 46954.8 | 49330.9 | 55348.1 | 62963.6 | 67102.3 | 2.6 |
|  Taxes Less Subsidies on Products | 167690.3 | 184016.7 | 185180.2 | 171328.7 | 180005.8 | 7.1 |
|  Gross Domestic Product at Current Market Prices | 2058466.5 | 2221912.9 | 2323781.5 | 2401189.4 | 2549120.7 | 100.0 |
|  Net Factor Income from the Rest of the World | 16943.8 | 23413.6 | 28055.4 | 42128.6 | 36081.9 | 1.4 |
|  Gross National Income at Current Market Price | 2075410.3 | 2245326.5 | 2351837.0 | 2443318.1 | 2585202.6 | 101.4 |

---

(1) Preliminary.

*Source:* The Bank of Korea

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The following table sets out the Republic's GDP per capita:

**Gross Domestic Product per capita** 

**(at current market prices)** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024<sup>(1)</sup>** |
|  GDP per capita (thousands of Won) | 39711 | 42919 | 44971 | 46433 | 49257 |
|  GDP per capita (U.S. dollar) | 33652 | 37503 | 34809 | 35570 | 36113 |
|  Average Exchange Rate (in Won per U.S. dollar) | 1180.1 | 1144.4 | 1292.0 | 1305.4 | 1364.0 |

---

(1) Preliminary.

*Source:* The Bank of Korea

The following table sets out the Republic's Gross National Income, or GNI, per capita:

**Gross National Income per capita** 

**(at current market prices)** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024<sup>(1)</sup>** |
|  GNI per capita (thousands of Won) | 40038 | 43372 | 45514 | 47248 | 49955 |
|  GNI per capita (U.S. dollar) | 33929 | 37898 | 35229 | 36194 | 36624 |
|  Average Exchange Rate (in Won per U.S. dollar) | 1180.1 | 1144.4 | 1292.0 | 1305.4 | 1364.0 |

---

(1) Preliminary.

*Source:* The Bank of Korea

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##### [**Table of Contents**](#toc)
The following table sets out the Republic's GDP by economic sector:

**Gross Domestic Product by Economic Sector** 

**(at chained 2020 year prices)** 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024<sup>(1)</sup>** | **As % of GDP<br>2024<sup>(1)</sup>** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Industrial Sectors: | 719110.4 | 754589.3 | 771177.9 | 782080.7 | 804949.7 | 35.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Agriculture, Forestry and Fishing | 32481.6 | 33598.5 | 33866.3 | 32972.5 | 33183.1 | 1.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Manufacturing, Mining and Quarrying | 530768.1 | 565269.6 | 579036.4 | 588841.5 | 612180.8 | 26.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mining and Quarrying | 1737.2 | 1974.8 | 1785.3 | 1808.5 | 1647.0 | 0.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Manufacturing | 529030.9 | 563294.8 | 577227.8 | 587008.9 | 610553.9 | 26.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electricity, Gas and Water Supply | 45605.3 | 46403.2 | 48020.4 | 46648.8 | 48964.8 | 2.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Construction | 110255.4 | 109318.0 | 110254.8 | 113617.9 | 110621.0 | 4.8 |
|  Services: | 1171665.8 | 1222603.2 | 1269070.6 | 1295453.4 | 1316497.5 | 57.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Wholesale and Retail Trade, Accommodation and Food Services | 214871.3 | 219693.4 | 231974.4 | 228939.2 | 225657.3 | 9.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transportation and Storage | 66603.8 | 73634.5 | 82748.1 | 92818.6 | 100657.2 | 4.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Finance and Insurance | 110016.4 | 117411.7 | 120645.5 | 121705.1 | 126001.9 | 5.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Real Estate | 161030.1 | 163741.0 | 160447.8 | 160758.7 | 164385.6 | 7.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Information and Communication | 89215.3 | 97513.5 | 99786.9 | 100881.1 | 102164.9 | 4.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Business Activities | 156652.6 | 159603.6 | 163453.3 | 166386.4 | 165512.1 | 7.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Public Administration, Defense and Social Security | 129850.9 | 134868.3 | 139003.2 | 142043.4 | 144685.9 | 6.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Education | 90436.1 | 95484.0 | 98708.1 | 99515.9 | 100136.8 | 4.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Human Health and Social Work | 106034.6 | 112370.6 | 119255.3 | 124697.3 | 129739.4 | 5.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cultural and Other Services | 46954.8 | 48282.6 | 52244.1 | 56119.8 | 56941.3 | 2.5 |
|  Taxes Less Subsidies on Products | 167690.3 | 176230.4 | 172134.2 | 164486.4 | 167118.6 | 7.3 |
|  Gross Domestic Product<sup>(2)</sup> | 2058466.5 | 2153422.9 | 2212158.9 | 2243220.4 | 2288923.2 | 100.0 |

---

(1) Preliminary.

(2) Under the "chain-linked" measure of GDP, the components of GDP will not necessarily add up to the
total GDP.

*Source:* The Bank of Korea

GDP in 2020 contracted by 0.7% at chained 2020 year prices, primarily due to a 4.6% decrease in private consumption expenditures and a 1.7% decrease in exports of goods and services, which were offset in significant part by a 3.3% decrease in imports of goods and services, a 5.2% increase in general government consumption expenditures and a 2.8% increase in gross domestic fixed capital formation, each compared with 2019. The contraction of the Republic's GDP in 2020 was primarily due to the COVID-19 pandemic.

GDP growth in 2021 was 4.6% at chained 2020 year prices, as exports of goods and services increased by 10.8%, aggregate private and general government consumption expenditures increased by 4.2% and gross

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domestic fixed capital formation increased by 4.3%, which more than offset an increase in imports of goods and services by 10.2%, each compared with 2020.

GDP growth in 2022 was 2.7% at chained 2020 year prices, as aggregate private and general government consumption expenditures increased by 4.2% and exports of goods and services increased by 3.9%, which more than offset an increase in imports of goods and services by 4.2% and a decrease in gross fixed capital formation by 0.2%, each compared with 2021.

GDP growth in 2023 was 1.4% at chained 2020 year prices, as exports of goods and services increased by 3.6%, aggregate private and general government consumption expenditures increased by 1.6% and gross domestic fixed capital formation increased by 1.4%, which was offset in significant part by a 3.5% increase in imports of goods and services, each compared with 2022.

Based on preliminary data, GDP growth in 2024 was 2.0% at chained 2020 year prices, as exports of goods and services increased by 6.9% and aggregate private and general government consumption expenditures increased by 1.3%, which was offset in part by a 2.4% increase in imports of goods and services and a 0.6% decrease in gross domestic fixed capital formation, each compared with 2023.

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##### [**Table of Contents**](#toc)
**Principal Sectors of the Economy** 

***Industrial Sectors***

The following table sets out production indices for the principal industrial products of the Republic and their relative contribution to total industrial production:

**Industrial Production** 

**(2020 = 100)** 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Index<br>Weight<sup>(1)</sup>** | **2020** | **2021** | **2022** | **2023** | **2024<sup>(2)</sup>** |
|  Industries | 10000.0 | 100.0 | 108.2 | 108.8 | 108.8 | 113.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mining and Manufacturing | 9555.0 | 100.0 | 108.2 | 108.8 | 108.8 | 113.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mining | 23.0 | 100.0 | 94.2 | 95.8 | 113.9 | 95.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Manufacturing | 9532.0 | 100.0 | 108.2 | 108.8 | 108.8 | 113.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Food Products | 485.9 | 100.0 | 111.7 | 114.0 | 109.3 | 125.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Beverage Products | 102.0 | 100.0 | 93.0 | 91.4 | 77.7 | 75.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tobacco Products | 44.7 | 100.0 | 88.4 | 93.2 | 100.9 | 114.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Textiles | 110.6 | 100.0 | 104.3 | 100.4 | 82.1 | 81.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Wearing Apparel, Clothing Accessories and Fur Articles | 83.2 | 100.0 | 137.3 | 117.6 | 114.0 | 73.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tanning and Dressing of Leather, Luggage and Footwear | 17.6 | 100.0 | 92.0 | 78.7 | 49.4 | 36.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Wood and Products of Wood and Cork (Except Furniture) | 31.0 | 100.0 | 80.4 | 89.5 | 94.5 | 77.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pulp, Paper and Paper Products | 133.8 | 100.0 | 97.5 | 95.1 | 93.7 | 102.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Printing and Reproduction of Recorded Media | 43.9 | 100.0 | 109.4 | 129.3 | 118.0 | 110.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Coke, hard-coal and lignite fuel briquettes and Refined Petroleum Products | 354.5 | 100.0 | 98.4 | 101.9 | 104.3 | 108.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Chemicals and Chemical Products | 756.8 | 100.0 | 105.9 | 93.6 | 91.0 | 96.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pharmaceuticals, Medicinal Chemicals and Botanical <br>Products | 288.9 | 100.0 | 96.2 | 111.7 | 141.2 | 157.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Rubber and Plastic Products | 414.8 | 100.0 | 104.5 | 110.9 | 112.8 | 120.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-metallic Minerals | 213.6 | 100.0 | 107.6 | 96.4 | 84.9 | 95.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Basic Metals | 600.2 | 100.0 | 101.0 | 95.5 | 97.5 | 97.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fabricated Metal Products | 495.9 | 100.0 | 83.7 | 82.7 | 93.4 | 112.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electronic Components, Computer, Radio, Television and Communication Equipment and Apparatuses | 2402.9 | 300.0 | 342.5 | 316.7 | 329.7 | 335.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Medical, Precision and Optical Instruments, Watches and Clocks | 389.1 | 300.0 | 297.5 | 365.1 | 364.4 | 388.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electrical Equipment | 478.2 | 100.0 | 113.4 | 138.3 | 120.8 | 94.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other Machinery and Equipment | 776.7 | 100.0 | 116.6 | 113.4 | 108.6 | 100.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Motor Vehicles, Trailers and Semitrailers | 1014.2 | 100.0 | 109.6 | 121.0 | 137.1 | 135.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other Transport Equipment | 144.1 | 100.0 | 93.3 | 108.0 | 103.4 | 110.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Furniture | 43.1 | 100.0 | 72.9 | 64.1 | 52.4 | 50.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other Products | 106.3 | 200.0 | 232.8 | 340.2 | 243.9 | 278.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electricity, Gas | 445.0 | 100.0 | 104.9 | 107.5 | 103.5 | 105.1 |
|  Total Index | 10000.0 | 100.0 | 108.2 | 108.8 | 108.8 | 113.2 |

---

(1) Index weights were established on the basis of an industrial census in 2020 and reflect the average annual value
added by production in each of the classifications shown, expressed as a percentage of total value added in the mining, manufacturing and electricity and gas industries in that year.

(2) Preliminary.

*Source:* The Bank of Korea; Korea National Statistical Office

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##### [**Table of Contents**](#toc)
Industrial production decreased by 0.3% in 2020, primarily due to decreased domestic consumption and exports resulting from the COVID-19 pandemic. Industrial production recovered and increased by 8.2% in 2021, primarily due to increased exports and domestic consumption. Industrial production increased by 0.6% in 2022, primarily due to increased exports and domestic consumption. Industrial production remained stable in 2023. Based on preliminary data, industrial production increased by 4.0% in 2024, primarily due to increased exports.

***Manufacturing***

The manufacturing sector decreased production by 0.4% in 2020, primarily due to decreased demand for automobiles. The manufacturing sector increased production by 8.2% in 2021, primarily due to increased demand for consumer electronics products, electronic components (including semiconductors) and machinery. The manufacturing sector increased production by 0.6% in 2022, primarily due to increased demand for electrical equipment and automobiles. Production levels for the manufacturing sector remained stable in 2023. Based on preliminary data, the manufacturing sector increased production by 4.0% in 2024, primarily due to increased demand for electronic components (including semiconductors) and pharmaceuticals.

*Automobiles.* In 2020, automobile production decreased by 11.2% and export sales volume recorded a decrease of 21.4%, compared with 2019, primarily due to a general decline in global demand for automobiles caused by the COVID-19 pandemic, which outpaced a 4.7% increase in domestic sales volume from 2019 to 2020, primarily due to increased domestic demand for automobiles. In 2021, automobile production decreased by 1.3% and domestic sales volume recorded a decrease of 8.5%, compared with 2020, primarily due to the global shortage of semiconductors amid the COVID-19 pandemic, but export sales volume recorded an increase of 8.6% compared with 2020, primarily due to an increase in the market share of domestic automobile manufacturers in the global automotive market. In 2022, automobile production increased by 8.5% and export sales volume recorded an increase of 12.7%, compared with 2021, primarily due to an increase in demand for Korean automobiles in the global automotive market as well as the gradual easing of the global shortage of automotive semiconductors in the second half of 2022, but domestic sales volume recorded a decrease of 3.2% compared with 2021, primarily due to the global shortage of automotive semiconductors during the first half of 2022. In 2023, automobile production increased by 13.0%, export sales volume recorded an increase of 20.3% and domestic sales volume recorded an increase of 3.3%, compared with 2022, primarily due to the continued easing of the global shortage of automotive semiconductors and increased global and domestic demand for environmentally-friendly automobiles. Based on preliminary data, in 2024, automobile production decreased by 2.7% and domestic sales volume recorded a decrease of 6.5%, compared with 2023, primarily due to a decrease in demand for automobiles following a deterioration in domestic economic conditions, but export sales volume recorded an increase of 0.6% compared with 2023, primarily due to an increase in demand for environmentally-friendly automobiles in the global automotive market.

*Electronics*. In 2020, electronics production amounted to W329,872 billion, an increase of 2.2% from the previous year, and exports of electronics amounted to US$183.5 billion, an increase of 3.7% from the previous year, primarily due to an increase in demand for semiconductors, computers and other electronic apparatuses. In 2020, export sales of semiconductor memory chips constituted approximately 19.5% of the Republic's total exports. In 2021, electronics production amounted to W370,907 billion, an increase of 12.4% from the previous year, and exports amounted to US$227.6 billion, an increase of 24.0% from the previous year, primarily due to an increase in demand for semiconductors, display panels, mobile devices, solid state drives and secondary cell batteries. In 2021, export sales of semiconductor memory chips constituted approximately 20.0% of the Republic's total exports. In 2022, electronics production amounted to W378,091 billion, an increase of 1.9% from the previous year, and exports amounted to US$233.2 billion, an increase of 2.5% from the previous year, primarily due to an increase in demand for semiconductors, display panels and secondary cell batteries. In 2022, export sales of semiconductor memory chips constituted approximately 19.1% of the Republic's total exports. Based on preliminary data, in 2023, electronics production amounted to W327,651 billion, a decrease of 13.3% from the previous year, and exports amounted to US$186.8 billion, a decrease of 19.9% from the previous year, primarily due to a decrease in demand for semiconductors, computers and other electronic apparatuses. In 2023,

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export sales of semiconductor memory chips constituted approximately 15.8% of the Republic's total exports. Based on preliminary data, in 2024, electronics production amounted to W373,322 billion, an increase of 13.9% from the previous year, and exports amounted to US$235.1 billion, an increase of 25.9% from the previous year, primarily due to an increase in demand for semiconductors, computers and other electronic apparatuses. In 2024, export sales of semiconductor memory chips constituted approximately 20.8% of the Republic's total exports.

*Iron and Steel.* In 2020, crude steel production totaled 67.1 million tons, a decrease of 6.0% from 2019, primarily due to adverse conditions in the construction and shipbuilding industries in light of the COVID-19 pandemic, and export sales volume of iron and steel products decreased by 5.0%, primarily due to a decrease in global demand for crude steel products resulting from the COVID-19 pandemic. In 2021, crude steel production totaled 70.4 million tons, an increase of 4.9% from 2020, primarily due to an increase in domestic demand for crude steel products following a gradual economic recovery from the COVID-19 pandemic, but export sales volume of iron and steel products decreased by 6.1%, primarily due to an increase in the price of steel products coupled with a decrease in global demand for crude steel products resulting from the COVID-19 pandemic. In 2022, crude steel production totaled 65.8 million tons, a decrease of 6.5% from 2021, primarily due to disruptions in supply chain resulting from the Russia-Ukraine war and the temporary closure of steel production plants in Korea due to a typhoon during the course of 2022, and export sales volume of iron and steel products decreased by 5.3%, primarily due to a decrease in global demand for crude steel products resulting from the lingering effects of the COVID-19 pandemic and a general slowdown of the global economy. In 2023, crude steel production totaled 66.7 million tons, an increase of 1.3% from 2022, primarily due to the re-opening of steel production plants in Korea following the recovery from the damage caused by a typhoon during 2022, and export sales volume of iron and steel products increased by 6.5%, primarily due to an increase in demand for crude steel products from North America and Japan. Based on preliminary data, in 2024, crude steel production totaled 63.5 million tons, a decrease of 4.8% from 2023, primarily due to a decrease in domestic demand for crude steel products resulting from adverse conditions in the construction and shipbuilding industries, although export sales volume of iron and steel products increased by 3.7%, primarily due to an increase in demand for crude steel products from export destinations in Europe, Mexico and India.

*Shipbuilding.* In 2020, the Republic's shipbuilding orders amounted to approximately 8 million compensated gross tons, a decrease of 20.0% compared to 2019, primarily due to the adverse conditions in the domestic and global shipbuilding industry resulting from the COVID-19 pandemic. In 2021, the Republic's shipbuilding orders amounted to approximately 17 million compensated gross tons, an increase of 112.5% compared to 2020, primarily due to increased demand for container carriers and LNG carriers. In 2022, the Republic's shipbuilding orders amounted to approximately 16 million compensated gross tons, a decrease of 5.9% compared to 2021, primarily due to a decrease in demand for oil tankers and container carriers. In 2023, the Republic's shipbuilding orders amounted to approximately 10 million compensated gross tons, a decrease of 37.5% compared to 2022, primarily due to decreased demand for container carriers and LNG carriers. Based on preliminary data, in 2024, the Republic's shipbuilding orders amounted to approximately 11 million compensated gross tons, an increase of 9.1% compared to 2023, primarily due to an increase in demand for LNG carriers, oil tankers and container carriers.

***Agriculture, Forestry and Fisheries***

The Government's agricultural policy has traditionally focused on:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• grain production;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• development of irrigation systems;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• land consolidation and reclamation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• seed improvement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• mechanization measures to combat drought and flood damage; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• increasing agricultural incomes.

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Recently, however, the Government has increased emphasis on cultivating profitable crops and strengthening international competitiveness as a result of the continued opening of the domestic agricultural market.

In 2020, rice production decreased 5.4% from 2019 to 3.5 million tons. In 2021, rice production increased 11.4% from 2020 to 3.9 million tons. In 2022, rice production decreased 2.6% from 2021 to 3.8 million tons. In 2023, rice production decreased 2.6% from 2022 to 3.7 million tons. In 2024, rice production decreased 2.7% from 2023 to 3.6 million tons. Due to limited crop yields resulting from geographical and physical constraints, the Republic depends on imports for certain basic foodstuffs.

The Government is seeking to develop the fishing industry by encouraging the building of large fishing vessels and modernizing fishing equipment, marketing techniques and distribution outlets.

In 2020, the agriculture, forestry and fisheries industry decreased by 6.7% compared to 2019, primarily due to a decrease in farming and livestock production. In 2021, the agriculture, forestry and fisheries industry increased by 3.4% compared to 2020, primarily due to an increase in farming and fisheries production. In 2022, the agriculture, forestry and fisheries industry increased by 0.8% compared to 2021, primarily due to an increase in livestock production. Based on preliminary data, in 2023, the agriculture, forestry and fisheries industry decreased by 2.6% compared to 2022, primarily due to a decrease in farming and livestock production. Based on preliminary data, in 2024, the agriculture, forestry and fisheries industry increased by 0.8% compared to 2023, primarily due an increase in farming and livestock production.

***Construction***

In 2020, the construction industry decreased by 0.4% compared to 2019, primarily due to a decrease in the construction of residential buildings. In 2021, the construction industry decreased by 0.9% compared to 2020, primarily due to a decrease in the construction of residential buildings. In 2022, the construction industry increased by 0.9% compared to 2021, primarily due to an increase in the construction of commercial buildings. Based on preliminary data, in 2023, the construction industry increased by 3.1% compared to 2022, primarily due to an increase in the construction of commercial buildings. Based on preliminary data, in 2024, the construction industry decreased by 2.8% compared to 2023, primarily due to a decrease in the construction of residential buildings.

***Electricity and Gas***

The following table sets out the Republic's dependence on imports for energy consumption:

**Dependence on Imports for Energy Consumption** 

---

| | | | |
|:---|:---|:---|:---|
|  | **Total Primary<br>Energy Supply** | **Imports** | **Imports Dependence<br>Ratio** |
|  | **(millions of tons of oil equivalents<sup>(1)</sup>, except ratios)** | **(millions of tons of oil equivalents<sup>(1)</sup>, except ratios)** | **(millions of tons of oil equivalents<sup>(1)</sup>, except ratios)** |
| 2020 | 285.6 | 271.3 | 95.0 |
| 2021 | 300.6 | 285.0 | 94.8 |
| 2022 | 304.0 | 287.0 | 94.4 |
| 2023<sup>(2)</sup> | 297.6 | 279.4 | 93.9 |
| 2024<sup>(2)</sup> | 303.5 | 284.1 | 93.6 |

---

(1) Conversion to tons of oil equivalents was calculated based on energy conversion factors under the Energy Act
Enforcement Decree as amended in July 2017.

(2) Preliminary.

*Source:* Korea Energy Economics Institute; Korea National Statistical Office

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Korea has almost no domestic oil or gas production and depends on imported oil and gas to meet its energy requirements. Accordingly, the international prices of oil and gas significantly affect the Korean economy. Any significant long-term increase in the prices of oil and gas will increase inflationary pressures in Korea and adversely affect the Republic's balance of trade.

To reduce its dependence on oil and gas imports, the Government has encouraged energy conservation and energy source diversification emphasizing nuclear energy. The following table sets out the principal primary sources of energy supplied in the Republic, expressed in oil equivalents and as a percentage of total energy consumption.

**Primary Energy Supply by Source** 

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| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Coal** | **Coal** | **Gas** | **Gas** | **Oil** | **Oil** | **Nuclear** | **Nuclear** | **Others<sup>(1)</sup>** | **Others<sup>(1)</sup>** | **Total** | **Total** |
|  | **Quantity** | **%** | **Quantity** | **%** | **Quantity** | **%** | **Quantity** | **%** | **Quantity** | **%** | **Quantity** | **%** |
|  | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** | **(millions of tons of oil equivalents<sup>(2)</sup>, except percentages)** |
| 2020 | 75983 | 26.6 | 53956 | 18.9 | 107971 | 37.8 | 34119 | 11.9 | 13524 | 4.7 | 285553 | 100.0 |
| 2021 | 76968 | 25.6 | 59628 | 19.8 | 115205 | 38.3 | 33657 | 11.2 | 15092 | 5.0 | 300550 | 100.0 |
| 2022 | 75869 | 25.0 | 59203 | 19.5 | 114676 | 37.7 | 37500 | 12.3 | 16732 | 5.5 | 303980 | 100.0 |
| 2023<sup>(3)</sup> | 73700 | 24.8 | 56648 | 19.0 | 111036 | 37.3 | 38445 | 12.9 | 17769 | 6.0 | 297598 | 100.0 |
| 2024<sup>(3)</sup> | 69682 | 23.0 | 60900 | 20.1 | 113888 | 37.5 | 40205 | 13.2 | 18859 | 6.2 | 303534 | 100.0 |

---

(1) Includes hydro-electric power, biofuels and waste-based energy, geothermal and solar power and heat.

(2) Conversion to tons of oil equivalents was calculated based on energy conversion factors under the Energy Act
Enforcement Decree as amended in July 2017.

(3) Preliminary.

*Source:* Korea Energy Economics Institute; The Bank of Korea

The Republic's first nuclear power plant went into full operation in 1978 with a rated generating capacity of 587 megawatts. As of December 31, 2024, the Republic had 26 nuclear plants with a total estimated nuclear power installed generating capacity of 26,050 megawatts and four nuclear plants under construction.

In February 2025, the Government announced the Eleventh Basic Plan of Long-Term Electricity Supply and Demand for the period from 2024 to 2038, which focuses on, among other things, (i) promoting the use of scientific methods to estimate and calculate future electricity demand, (ii) pursuit of energy mix that prioritizes supply stability, efficiency and carbon neutrality, (iii) expansion of carbon-free energy sources instead of converting aging coal-fired generation plants into LNG power plants, (iv) expansion of power grid systems that take into account the construction of new facilities for renewable energy, and (v) effective utilization of the energy market to enhance supply stability and energy distribution. Furthermore, the Eleventh Basic Plan includes the following implementation measures: (i) continued utilization of nuclear power as a carbon-free energy source, (ii) systematic expansion of renewable energy sources while attaining greenhouse gas reduction goals, (iii) expansion of clean hydrogen- and ammonia-based power generation, and (iv) incorporation of district energy systems into the national electricity supply and demand management framework.

***Services Sector***

In 2020, the service industry decreased by 0.7% compared to 2019 as the arts, sports and recreation related services sector decreased by 31.9%, the accommodation and food service activities sector decreased by 17.9% and the transportation and storage sector decreased by 12.4%, each compared with 2019. In 2021, the service industry increased by 8.8% compared to 2020 as the arts, sports and recreation related services sector increased by 18.8%, the information and communications sector increased by 14.6% and the transportation and storage sector increased by 11.9%, each compared with 2020. In 2022, the service industry increased by 11.6% compared to 2021 as the arts, sports and recreation related services sector increased by 48.5%, the transportation and

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storage sector increased by 30.5% and the accommodation and food services sector increased by 25.6%, each compared with 2021. In 2023, the service industry increased by 4.8% compared to 2022 as the arts, sports and recreation related services sector increased by 9.8%, the membership organizations, repair and other personal services sector increased by 8.9% and the financial and insurance activities sector increased by 8.1%, each compared with 2022. Based on preliminary data, in 2024, the service industry increased by 3.2% compared to 2023 as the transportation and storage sector increased by 7.6%, the information and communications sector increased by 6.5% and the arts, sports and recreation related services sector increased by 3.7%, each compared with 2023.

***Prices, Wages and Employment***

The following table shows selected price and wage indices and unemployment rates:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Producer<br>Price<br>Index<sup>(1)</sup>** | **Increase<br>(Decrease)<br>Over<br>Previous<br>Year** | **Consumer<br>Price<br>Index<sup>(1)</sup>** | **Increase<br>(Decrease)<br>Over<br>Previous<br>Year** | **Wage<br>Index<sup>(1)(2)</sup>** | **Increase<br>(Decrease)<br>Over<br>Previous<br>Year** | **Unemployment<br>Rate<sup>(1)(3)</sup>** |
|  | **(2020=100)** | **(%)** | **(2020=100)** | **(%)** | **(2015=100)** | **(%)** | **(%)** |
| 2020 | 100.0 | (0.5) | 100.0 | 0.5 | 115.5 | (0.6) | 4.0 |
| 2021 | 106.4 | 6.4 | 102.5 | 2.5 | 123.5 | 6.9 | 3.7 |
| 2022 | 115.3 | 8.4 | 107.7 | 5.1 | 130.7 | 5.8 | 2.9 |
| 2023 | 117.1 | 1.6 | 111.6 | 3.6 | 134.9 | 3.2 | 2.7 |
| 2024 | 119.1 | 1.7 | 114.2 | 2.3 | N/A<sup>(4)</sup> | N/A<sup>(4)</sup> | 2.8 |

---

(1) Average for the year.

(2) Nominal wage index of average earnings in the manufacturing industry.

(3) Expressed as a percentage of the economically active population.

(4) Not available.

*Source:* The Bank of Korea; Korea National Statistical Office

In 2020, the inflation rate increased to 0.5%, primarily due to increases in agricultural and livestock product prices. In 2021, the inflation rate increased to 2.5%, primarily due to increases in agricultural and livestock product prices and oil prices. In 2022, the inflation rate increased to 5.1%, primarily due to increases in agricultural and livestock product prices and oil prices. In 2023, the inflation rate decreased to 3.6%, primarily due to a slower rate of increase in the prices of agricultural and livestock products and oil. Based on preliminary data, in 2024, the inflation rate decreased to 2.3% despite increases in agricultural and livestock product prices, primarily due to a slower rate of increase in the prices of personal services, electricity, gas, water and processed goods and, to a lesser extent, a decrease in oil prices.

In 2020, the unemployment rate increased to 4.0%, primarily due to the COVID-19 pandemic. In 2021, the unemployment rate decreased to 3.7%, reflecting a gradual recovery of the Korean economy from the COVID-19 pandemic. In 2022, the unemployment rate decreased to 2.9%, reflecting a gradual recovery of the Korean economy from the COVID-19 pandemic. In 2023, the unemployment rate decreased to 2.7%, primarily due to an increase in the number of workers employed in the service industry. Based on preliminary data, in 2024, the unemployment rate increased to 2.8%, primarily due to a decrease in the number of workers employed in the manufacturing and construction sectors.

From 1992 to 2009, the economically active population of the Republic increased by approximately 24.8% to 24.3 million, while the number of employees increased by approximately 23.7% to 23.5 million. The economically active population over 15 years old as a percentage of the total over-15 population has remained between 62% and 65% over the past decade. Literacy among workers under 50 is almost universal. As of December 31, 2024, the economically active population of the Republic was 29.4 million and the number of employees was 28.6 million.

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The following table shows selected employment information by industry and by gender:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024** |
|  | **(all figures in percentages, except as indicated)** | **(all figures in percentages, except as indicated)** | **(all figures in percentages, except as indicated)** | **(all figures in percentages, except as indicated)** | **(all figures in percentages, except as indicated)** |
|  Labor force (in thousands of persons) | 26904 | 27273 | 28089 | 28416 | 28576 |
|  Employment by Industry: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Agriculture, Forestry and Fishing | 5.4 | 5.3 | 5.4 | 5.3 | 5.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mining and Manufacturing | 16.3 | 16.1 | 16.1 | 15.7 | 15.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; S.O.C & Services | 78.3 | 78.6 | 78.5 | 79.0 | 79.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electricity, Transport, Communication and Finance | 11.8 | 12.3 | 12.4 | 12.5 | 12.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Business, Private & Public Service and Other Services | 38.0 | 38.6 | 39.0 | 39.4 | 39.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Construction | 7.5 | 7.7 | 7.6 | 7.4 | 7.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Wholesale & Retail Trade, Hotels and Restaurants | 21.0 | 20.0 | 19.6 | 19.6 | 19.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Employed | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 |
|  Employment by Gender: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Male | 57.2 | 57.0 | 56.7 | 56.1 | 55.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Female | 42.8 | 43.0 | 43.3 | 43.9 | 44.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Employed | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 |

---

*Source:* The Bank of Korea

Pursuant to certain amendments to the Labor Standards Act that became effective on July 1, 2018, the maximum working hours of employees have been reduced from 68 hours per week to 52 hours per week, and the number of special industries that are exempt from restrictions on maximum working hours will be significantly reduced. This new maximum working hours restriction under the amended Labor Standards Act is in effect for workplaces with 300 or more workers from July 1, 2018, and has been extended to workplaces with 50 or more but fewer than 300 workers from January 1, 2020, and has been further extended to workplaces with five or more but fewer than 50 workers from July 1, 2021.

Labor unrest in connection with demands by unionized workers for better wages and working conditions and greater job security occurs from time to time in the Republic. Some of the significant incidents in recent years include the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In October, November and December 2020, unionized workers at GM Korea went on partial strikes during wage and
collective agreement negotiations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In November and December 2020, unionized workers at Kia went on partial strikes demanding higher wages,
performance-based incentives and other benefits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In November and December 2021, unionized workers at Hankook Tire & Technology, one of Korea's
largest tire makers, went on a full strike demanding higher wages and performance-based incentive payments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In 2021, unionized workers at CJ Logistics, one of Korea's largest freight transportation companies, went
on a series of partial strikes and demonstrations, demanding higher wages commensurate with increases in parcel delivery fees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In June and November 2022, unionized truck drivers across various industries went on nationwide strikes demanding
that a minimum pay system based on freight rates be made permanent and expanded in scope.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In 2022, subcontracted workers of Daewoo Shipping and Marine Engineering went on a full strike demanding higher
wages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In September 2023, the National Railroad Workers' Union went on strike demanding improved pay and working
conditions and an expansion of the KTX bullet train services.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In November 2023, unionized Seoul subway workers went on strike in protest of the city-run Seoul Metro's bid to downsize its workforce.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In early 2024, thousands of doctors went on strike to protest the Government's plans to increase the number
of medical school admissions, and to demand higher pay and reductions in their workload, among others.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In December 2024, the National Railroad Workers' Union and Seoul Subway Workers' Union went on strike
demanding increased pay and improved working conditions.

Actions such as these by labor unions may hinder implementation of the labor reform measures and disrupt the Government's plans to create a more flexible labor market. Although much effort is being expended to resolve labor disputes in a peaceful manner, there can be no assurance that further labor unrest will not occur in the future. Continued labor unrest in key industries of the Republic may have an adverse effect on the economy.

In 1997, the Korean Confederation of Trade Unions organized a political alliance, which led to the formation of the Democratic Labor Party in January 2000. The Democratic Labor Party merged with The New People's Participation Party and changed its name to The Unified Progressive Party, or the UPP, in December 2011. In October 2012, the UPP split and seven UPP members of the National Assembly and their supporters formed a new party, the Progressive Justice Party, which changed its name to the Justice Party in July 2013. In December 2014, the Constitutional Court ordered the dissolution of the UPP and the removal of the party's five lawmakers from the National Assembly for violating the Republic's Constitution after certain of its members were convicted of trying to instigate an armed rebellion and supporting North Korea. In the legislative general election held on April 13, 2016, the Justice Party won six seats in the National Assembly, and the members-elect began their four-year terms on May 30, 2016. As of December 31, 2024, the Justice Party did not hold any seat in the National Assembly.

***Population and Birthrate***

Both the population and birthrate in the Republic have been declining for most of the recent past. The population has decreased by 1.2% from 2020 to 2024, and the birthrate has decreased by 10.7% over the same period.

The following table shows the population and birthrate of the Republic:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024** |
|  Population (in thousands of persons) | 51829 | 51639 | 51439 | 51325 | 51217 |
|  Birthrate (percentage)<sup>(1)</sup> | 0.84 | 0.81 | 0.78 | 0.72 | 0.75<sup>(2)</sup> |

---

(1) Represents the average number of children a woman gives birth to over her lifetime.

(2) Preliminary.

*Source:* Ministry of the Interior and Safety; Korea National Statistical Office

**The Financial System** 

***Structure of the Financial Sector***

The Republic's financial sector includes the following categories of financial institutions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank of Korea;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• banking institutions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• non-bank financial institutions; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other financial entities, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• financial investment companies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• credit guarantee institutions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• venture capital companies; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• miscellaneous others.

To increase transparency in financial transactions and enhance the integrity and efficiency of the financial markets, Korean law requires that financial institutions confirm that their clients use their real names when transacting business. The Government also strengthened confidentiality protection for private financial transactions.

In July 2007, the Korean National Assembly passed the Financial Investment Services and Capital Markets Act, or the FSCMA, under which various industry-based capital markets regulatory systems were consolidated into a single regulatory system. The FSCMA, which became effective in February 2009, expands the scope of permitted investment-related financial products and activities through expansive definitions of financial instruments and function-based regulations that allow financial investment companies to offer a wider range of financial services, as well as strengthening investor protection and disclosure requirements.

Prior to the effective date of the FSCMA, separate laws regulated various types of financial institutions depending on the type of the financial institution (for example, securities companies, futures companies, trust business companies and asset management companies) and subjected financial institutions to different licensing and ongoing regulatory requirements (for example, under the Securities and Exchange Act, the Futures Trading Act and the Indirect Investment Asset Management Business Act). By applying one uniform set of rules to financial businesses having the same economic function, the FSCMA attempts to improve and address issues caused by the previous regulatory system under which the same economic function relating to capital markets-related business were governed by multiple regulations. To this end, the FSCMA categorizes capital markets-related businesses into six different functions as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• investment dealing (trading and underwriting of financial investment products);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• investment brokerage (brokerage of financial investment products);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• collective investment (establishment of collective investment schemes and the management thereof);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• investment advice;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• discretionary investment management; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• trusts (together with the five businesses set forth above, the Financial Investment Businesses).

Accordingly, all financial businesses relating to financial investment products are classified as one or more of the Financial Investment Businesses described above, and financial institutions are subject to the regulations applicable to their relevant Financial Investment Businesses, irrespective of what type of financial institution it is. For example, under the FSCMA, derivative businesses conducted by securities companies and future companies are subject to the same regulations, at least in principle.

The banking business and the insurance business are not subject to the FSCMA and will continue to be regulated under separate laws; provided, however, that they are subject to the FSCMA if their activities involve any Financial Investment Businesses requiring a license based on the FSCMA.

***Banking Industry***

The banking industry comprises commercial banks and specialized banks. Commercial banks serve the general public and corporate sectors. They include nationwide banks, regional banks and branches of foreign banks. Regional banks provide services similar to nationwide banks, but operate in a geographically restricted

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##### [**Table of Contents**](#toc)
region. Branches of foreign banks have operated in the Republic since 1967 but provide a relatively small proportion of the country's banking services. As of December 31, 2024, there were seven nationwide banks, five regional banks, three internet-only banks and 33 foreign banks with branches operating in the Republic.

Specialized banks meet the needs of specific sectors of the economy in accordance with Government policy; they are organized under, or chartered by, special laws. Specialized banks include (i) The Korea Development Bank, (ii) The Export-Import Bank of Korea, (iii) Industrial Bank of Korea, (iv) SuHyup Bank and (v) NongHyup Bank. The Government has made capital contributions to three of these specialized banks as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **The Korea Development Bank**: the Government owns directly all of its paid-in capital and has made capital contributions since its establishment in 1954. Recent examples include the Government's contributions to its capital of W 2,103 billion in 2020, W 1,121 billion in 2021, W 1,265 billion in 2022, W 775 billion in 2023 and W 2,185 billion in 2024. Taking into account these capital contributions, its total paid-in capital was W 26,317 billion as of December 31, 2024.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **The Export-Import Bank of Korea**: the Government owns, directly and indirectly, all of its paid-in capital and has made capital contributions since its establishment in 1976. Recent examples include the Government's contributions to its capital of W 578 billion in 2020, W 299 billion in 2021, W 25 billion in 2022, W 2,000 billion in 2023 and W 2,100 billion in 2024. Taking into account these capital contributions, its total paid-in capital was W 16,873 billion as of December 31, 2024.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **Industrial Bank of Korea**: the Government directly owned 59.5% of its total shares (including common and
preferred shares) as of December 31, 2024. The Government had owned all of the issued share capital of Industrial Bank of Korea until 1994, but the Government's minimum share ownership requirement was repealed in 1997, and the Government
has since periodically adjusted its ownership percentage in Industrial Bank of Korea through transactions involving the purchase and sale of its common shares. In 2020, Industrial Bank of Korea issued an aggregate of 161,507,381 new common shares to
the Government for a total of W 1,266 billion in cash. In November 2020, Industrial Bank of Korea acquired from the Government and cancelled an aggregate of 44,847,038 perpetual preferred shares that it had previously issued to
the Government. In May 2021, Industrial Bank of Korea issued and sold 5,636,227 new ordinary shares to the Government for an aggregate consideration of W 49 billion in cash. Taking into account such transactions, its total paid-in capital was W 4,211 billion as of December 31, 2024.

The economic difficulties in 1997 and 1998 caused an increase in Korean banks' non-performing assets and a decline in capital adequacy ratios of Korean banks. From 1998 through 2002, the Financial Services Commission amended banking regulations several times to adopt more stringent criteria for non-performing assets that more closely followed international standards.

The following table sets out the total loans (including loans in Won and loans in foreign currencies) and non-performing assets of Korean banks as of the dates indicated.

---

| | | | |
|:---|:---|:---|:---|
|  | **Total Loans** | **Non-Performing<br>Assets<sup>(1)</sup>** | **Percentage<br>of Total** |
|  | **(trillions of won)** | **(trillions of won)** | **(percentage)** |
|  December 31, 2020 | 2171.7 | 13.9 | 0.6 |
|  December 31, 2021 | 2371.9 | 11.8 | 0.5 |
|  December 31, 2022 | 2532.4 | 10.1 | 0.4 |
|  December 31, 2023 | 2629.0 | 12.5 | 0.5 |
|  December 31, 2024<sup>(2)</sup> | 2799.1 | 14.8 | 0.5 |

---

(1) Assets classified as substandard or below.

(2) Preliminary.

*Source:* Financial Supervisory Service

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In 2020, these banks posted an aggregate net profit of W12.1 trillion, compared to an aggregate net profit of W13.9 trillion in 2019, primarily due to increased loan loss provisions. In 2021, these banks posted an aggregate net profit of W16.9 trillion, compared to an aggregate net profit of W12.1 trillion in 2020, primarily due to the significant amount of gains recognized by The Korea Development Bank in connection with the exercise of its right to convert its convertible bonds issued by HMM Company Limited into common shares, which took place in June 2021, and to a lesser extent, increased net interest income and decreased loan loss provisions. In 2022, these banks posted an aggregate net profit of W18.5 trillion, compared to an aggregate net profit of W16.9 trillion in 2021, primarily due to increased net interest income reflecting the rise in interest rates during 2022. In 2023, these banks posted an aggregate net profit of W21.2 trillion, compared to an aggregate net profit of W18.5 trillion in 2022, primarily due to an increase in net interest income, which was offset in part by an increase in loan loss provisions. Based on preliminary data, in 2024, these banks posted an aggregate net profit of W22.4 trillion, compared to an aggregate net profit of W21.2 trillion in 2023, primarily due to a decrease in loan loss provisions, which was offset in part by an increase in non-operating expenses.

***Non-Bank Financial Institutions***

Non-bank financial institutions include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• savings institutions, including trust accounts of banks, mutual savings banks, credit unions, mutual credit
facilities, community credit cooperatives and postal savings;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• life insurance institutions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• credit card companies.

As of December 31, 2024, 79 mutual savings banks, 22 life insurance institutions, which include joint venture life insurance institutions and wholly-owned subsidiaries of foreign life insurance companies, and eight credit card companies operated in the Republic.

***Money Markets***

In the Republic, the money markets consist of the call market and markets for a wide range of other short-term financial instruments, including treasury bills, monetary stabilization bonds, negotiable certificates of deposits, repurchase agreements and commercial paper.

***Securities Markets***

On January 27, 2005, the Korea Exchange was established pursuant to the now repealed Korea Securities and Futures Trading Act by consolidating the Korea Stock Exchange, the Korea Futures Exchange, the KOSDAQ Stock Market, Inc., or the KOSDAQ, and the KOSDAQ Committee of the Korea Securities Dealers Association, which had formerly managed the KOSDAQ. There are three major markets operated by the Korea Exchange: the KRX KOSPI Market, the KRX KOSDAQ Market, and the KRX Derivatives Market. The Korea Exchange has two trading floors located in Seoul, one for the KRX KOSPI Market and one for the KRX KOSDAQ Market, and one trading floor in Busan for the KRX Derivatives Market. The Korea Exchange is a joint stock company with limited liability, the shares of which are held by (i) financial investment companies that were formerly members of the Korea Futures Exchange or the Korea Stock Exchange and (ii) the stockholders of the KOSDAQ. Currently, the Korea Exchange is the only stock exchange in Korea and is operated by membership, having as its members Korean financial investment companies and some Korean branches of foreign financial investment companies.

The Korea Exchange publishes the Korea Composite Stock Price Index every ten seconds, which is an index of all equity securities listed on the Korea Exchange. The Korea Composite Stock Price Index is computed using the aggregate value method, whereby the market capitalizations of all listed companies are aggregated, subject to certain adjustments, and this aggregate is expressed as a percentage of the aggregate market capitalization of all listed companies as of the base date, January 4, 1980.

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The following table shows the value of the Korea Composite Stock Price Index as of the dates indicated:

---

| | |
|:---|:---|
|  December 30, 2020 | 2873.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 29, 2021 | 2976.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 26, 2021 | 3013.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31, 2021 | 3061.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 30, 2021 | 3147.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; May 31, 2021 | 3203.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 30, 2021 | 3296.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 30, 2021 | 3202.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; August 31, 2021 | 3199.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; September 30, 2021 | 3068.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; October 29, 2021 | 2970.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; November 30, 2021 | 2839.0 |
|  December 30, 2021 | 2977.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 28, 2022 | 2663.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 28, 2022 | 2699.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31, 2022 | 2757.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 29, 2022 | 2695.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; May 31, 2022 | 2685.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 30, 2022 | 2332.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 29, 2022 | 2451.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; August 31, 2022 | 2472.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; September 30, 2022 | 2155.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; October 31, 2022 | 2293.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; November 30, 2022 | 2472.5 |
|  December 29, 2022 | 2236.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 31, 2023 | 2425.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 28, 2023 | 2412.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31, 2023 | 2476.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 28, 2023 | 2501.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; May 31, 2023 | 2577.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 30, 2023 | 2564.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 31, 2023 | 2632.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; August 31, 2023 | 2556.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; September 27, 2023 | 2465.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; October 31, 2023 | 2278.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; November 30, 2023 | 2535.3 |
|  December 28, 2023 | 2655.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 31, 2024 | 2497.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 29, 2024 | 2642.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 29, 2024 | 2746.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 30, 2024 | 2692.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; May 31, 2024 | 2636.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 28, 2024 | 2797.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 31, 2024 | 2770.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; August 30, 2024 | 2674.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; September 30, 2024 | 2593.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; October 31, 2024 | 2556.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; November 29, 2024 | 2455.9 |
|  December 30, 2024 | 2399.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 31, 2025 | 2517.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 28, 2025 | 2532.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31, 2025 | 2481.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 30, 2025 | 2556.6 |

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Over the years, liquidity and credit concerns and volatility in the global financial markets have led to fluctuations in the stock prices of Korean companies. In recent years, there was significant volatility in the stock prices of Korean companies due to deteriorating market conditions domestically and abroad. The index was 2,579.5 on May 8, 2025.

***Supervision System***

The Office of Bank Supervision, the Securities Supervisory Board, the Insurance Supervisory Board and all other financial sector regulatory bodies merged in January 1999 to form the Financial Supervisory Service. The Financial Services Commission acts as the executive body over the Financial Supervisory Service. The Financial Services Commission reports to, but operates independently of, the Prime Minister's office.

The Ministry of Economy and Finance focuses on financial policy and foreign currency regulations. The Bank of Korea manages monetary policy focusing on price stabilization.

***Deposit Insurance System***

The Republic's deposit insurance system insures amounts on deposit with banks, non-bank financial institutions, securities companies and life insurance companies.

Since January 2001, deposits at any single financial institution are insured only up to W50 million per person regardless of the amount deposited, although such limit is expected to be increased to W100 million per person through an amendment to the Depositor Protection Act of Korea and the Presidential Decree thereof, which is expected to become effective by September 2025.

The Government excluded certain deposits, such as repurchase agreements, from the insurance scheme, expanded the definition of unsound financial institutions to which the insurance scheme would apply and gradually increased the insurance premiums payable by insured financial institutions.

**Monetary Policy** 

***The Bank of Korea***

The Bank of Korea was established in 1950 as Korea's central bank and the country's sole currency issuing bank. A seven-member Monetary Policy Committee, chaired by the Governor of The Bank of Korea, formulates and controls monetary and credit policies.

Inflation targeting is the basic system of operation for Korean monetary policy. The consumer price index is used as The Bank of Korea's target indicator. To achieve its established inflation target, the Monetary Policy Committee of The Bank of Korea determines and announces the "Bank of Korea Base Rate", the reference rate applied in transactions such as repurchase agreements between The Bank of Korea and its financial institution counterparts. The Bank of Korea uses open market operations as its primary instrument to keep the call rate in line with the Monetary Policy Committee's target rate. In addition, The Bank of Korea is able to establish policies regarding its lending to banks in Korea and their reserve requirements.

***Interest Rates***

The Bank of Korea lowered its policy rate to 1.5% from 1.75% on July 18, 2019 and to 1.25% from 1.5% on October 16, 2019 to address the sluggishness of the global and domestic economy. On March 16, 2020, The Bank of Korea further lowered its policy rate to 0.75% from 1.25%, which was further lowered to 0.5% on May 28, 2020, in response to deteriorating economic conditions resulting from the COVID-19 pandemic. However, as the economy began to show signs of recovery from the COVID-19 pandemic starting from the second half of 2021, The Bank of Korea raised its policy rate from 0.50% to 0.75% on August 26, 2021, 1.00% on November 25,

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2021 and 1.25% on January 14, 2022. Subsequently, in response to rising levels of household debt and inflationary pressures, The Bank of Korea continued to raise its policy rate, to 1.50% on April 14, 2022, 1.75% on May 26, 2022, 2.25% on July 13, 2022, 2.50% on August 25, 2022, 3.00% on October 12, 2022, 3.25% on November 24, 2022 and 3.50% on January 13, 2023. More recently, however, The Bank of Korea began to lower its policy rate, to 3.25% on October 11, 2024, 3.00% on November 28, 2024 and 2.75% on February 25, 2025 in response to weak economic conditions in the Republic.

With the deregulation of interest rates on banks' demand deposits on February 2, 2004, The Bank of Korea completed the interest rate deregulation based upon the "Four-Stage Interest Rate Liberalization Plan" announced in 1991. The prohibition on the payment of interest on ordinary checking accounts was, however, maintained.

***Money Supply***

The following table shows the volume of the Republic's money supply:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** |
|  | **2020** | **2021** | **2022** | **2023** | **2024** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Money Supply (M1)<sup>(1)</sup> | 1197828.9 | 1372336.6 | 1236983.3 | 1246196.4 | 1297881.8 |
|  Quasi-money<sup>(2)</sup> | 2002006.8 | 2241351.0 | 2521252.2 | 2658356.2 | 2862473.9 |
|  Money Supply (M2<sup>)(3)</sup> | 3199835.7 | 3613687.6 | 3758235.5 | 3904552.6 | 4160355.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Percentage Increase Over Previous Year | 9.8% | 12.9% | 4.0% | 3.9% | 6.6% |

---

(1) Consists of currency in circulation and demand and instant access savings deposits at financial institutions.

(2) Includes time and installment savings deposits, marketable instruments, yield-based dividend instruments and
financial debentures, excluding financial instruments with a maturity of more than two years.

(3) Money Supply (M2) is the sum of Money Supply (M1) and quasi-money.

*Source:* The Bank of Korea

***Exchange Controls***

Authorized foreign exchange banks, as registered with the Ministry of Economy and Finance, handle foreign exchange transactions. The ministry has designated other types of financial institutions to handle foreign exchange transactions on a limited basis.

Korean laws and regulations generally require a report to either the Ministry of Economy and Finance, The Bank of Korea or authorized foreign exchange banks, as applicable, for issuances of international bonds and other instruments, overseas investments and certain other transactions involving foreign exchange payments.

In 1994 and 1995, the Government relaxed regulations of foreign exchange position ceilings and foreign exchange transaction documentation and created free Won accounts which may be opened by non-residents at Korean foreign exchange banks. The Won funds deposited into the free Won accounts may be converted into foreign currencies and remitted outside Korea without any governmental approval. In December 1996, after joining the OECD, the Republic freed the repatriation of investment funds, dividends and profits, as well as loan repayments and interest payments. The Government continues to reduce exchange controls in response to changes in the world economy, including the new trade regime under the WTO, anticipating that such foreign exchange reform will improve the Republic's competitiveness and encourage strategic alliances between domestic and foreign entities.

In September 1998, the National Assembly passed the Foreign Exchange Transactions Act, which became effective in April 1999 and has subsequently been amended numerous times. In principle, most currency and capital transactions, including, among others, the following transactions, have been liberalized:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the investment in real property located overseas by Korean companies and financial institutions;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the establishment of overseas branches and subsidiaries by Korean companies and financial institutions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the investment by non-residents in deposits and trust products having
more than one year maturities; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the issuance of debentures by non-residents in the Korean market.

To minimize the adverse effects from further opening of the Korean capital markets, the Ministry of Economy and Finance is authorized to introduce a variable deposit requirement system to restrict the influx of short-term speculative funds.

The Government has also embarked on a second set of liberalization initiatives starting in January 2001, under which ceilings on international payments for Korean residents have been eliminated, including overseas travel expenses, overseas inheritance remittances and emigration expenses. Overseas deposits, trusts, acquisitions of foreign securities and other foreign capital transactions made by residents and the making of deposits in Korean currency by non-residents have also been liberalized. In line with the foregoing liberalization, measures will also be adopted to curb illegal foreign exchange transactions and to stabilize the foreign exchange market.

Effective as of January 1, 2006, the Government liberalized the regulations governing "capital transactions". The regulations provide that no regulatory approvals are required for any capital transactions. The capital transactions previously subject to approval requirements are now subject only to reporting requirements.

In January 2010, the Financial Supervisory Services released *FX Derivative Transactions Risk Management Guideline* to prevent over-hedging of foreign exchange risk by corporate investors. According to the guideline as amended in October 2023, if a corporate investor, other than a financial institution or a public enterprise, wishes to enter into a currency forward, currency option, foreign exchange swap or currency swap agreement with a bank, the bank is required to verify whether the corporate investor's assets, liabilities or contracts face foreign exchange risks that could be mitigated by a currency forward, currency option, foreign exchange swap or currency swap agreement. In addition, the bank is required to ensure that the corporate investor's risk hedge ratio, which is the ratio of the aggregate notional amount to the aggregate amount of risk, does not exceed 100%.

***Foreign Exchange***

The following table shows the exchange rate between the Won and the U.S. Dollar (in Won per U.S. Dollar) as announced by the Seoul Money Brokerage Services, Ltd. as of the dates indicated:

---

| | |
|:---|:---|
|  | **Won/U.S. Dollar<br>Exchange Rate** |
|  December 31, 2020 | 1088.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 29, 2021 | 1114.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 26, 2021 | 1108.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31, 2021 | 1133.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 30, 2021 | 1119.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; May 31, 2021 | 1116.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 30, 2021 | 1130.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 30, 2021 | 1147.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; August 31, 2021 | 1164.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; September 30, 2021 | 1184.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; October 29, 2021 | 1171.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; November 30, 2021 | 1193.4 |

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---

| | |
|:---|:---|
|  | **Won/U.S. Dollar<br>Exchange Rate** |
|  December 31, 2021 | 1185.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 28, 2022 | 1202.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 28, 2022 | 1202.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31, 2022 | 1210.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 29, 2022 | 1269.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; May 31, 2022 | 1245.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 30, 2022 | 1299.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 29, 2022 | 1304.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; August 31, 2022 | 1347.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; September 30, 2022 | 1434.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; October 31, 2022 | 1419.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; November 30, 2022 | 1331.5 |
|  December 30, 2022 | 1267.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 31, 2023 | 1228.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 28, 2023 | 1317.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31, 2023 | 1303.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 28, 2023 | 1339.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; May 31, 2023 | 1322.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 30, 2023 | 1312.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 31, 2023 | 1280.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; August 31, 2023 | 1321.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; September 27, 2023 | 1344.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; October 31, 2023 | 1352.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; November 30, 2023 | 1289.0 |
|  December 29, 2023 | 1289.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 31, 2024 | 1330.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 29, 2024 | 1334.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 29, 2024 | 1346.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 30, 2024 | 1378.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; May 31, 2024 | 1376.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 28, 2024 | 1389.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 31, 2024 | 1384.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; August 30, 2024 | 1335.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; September 30, 2024 | 1319.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; October 31, 2024 | 1383.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; November 29, 2024 | 1394.7 |
|  December 31, 2024 | 1470.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; January 31, 2025 | 1433.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; February 28, 2025 | 1439.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31, 2025 | 1466.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 30, 2025 | 1438.5 |

---

During the period from January 2, 2008 through April 16, 2009, the value of the Won relative to the U.S. dollar declined by approximately 29.9%, due primarily to adverse economic conditions resulting from liquidity and credit concerns and volatility in the global credit and financial markets and repatriations by foreign investors of their investments in the Korean stock market. The exchange rate between the Won and the U.S. Dollar has fluctuated since then. In recent years, the value of the Won relative to the U.S. dollar depreciated significantly, due primarily to the COVID-19 pandemic, the Russia-Ukraine war and ensuing sanctions against Russia, the escalating hostilities in the Middle East following the Israel-Hamas war and, more recently, the political situation in Korea relating to the impeachment of former President Yoon in April 2025 following his declaration of martial law in December 2024, among others. The market average exchange rate was Won 1,394.1 to US$1.00 on May 8, 2025.

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**Balance of Payments and Foreign Trade** 

***Balance of Payments***

Balance of payments figures measure the relative flow of goods, services and capital into and out of the country as represented in the current balance and the capital balance. The current balance tracks a country's trade in goods and services and transfer payments and measures whether a country is living within its income from trading and investments. The capital balance covers all transactions involving the transfer of capital into and out of the country, including loans and investments. The overall balance represents the sum of the current and capital balances. An overall balance surplus indicates a net inflow of foreign currencies, thereby increasing demand for and strengthening the local currency. An overall balance deficit indicates a net outflow of foreign currencies, thereby decreasing demand for and weakening the local currency. The financial account mirrors the overall balance. If the overall balance is positive, the surplus, which represents the nation's savings, finances the overall deficit of the country's trading partners. Accordingly, the financial account will indicate cash outflows equal to the overall surplus. If, however, the overall balance is negative, the nation has an international deficit which must be financed. Accordingly, the financial account will indicate cash inflows equal to the overall deficit.

The following table sets out certain information with respect to the Republic's balance of payments:

**Balance of Payments<sup>(1)</sup>** 

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Classification** | **2020** | **2021** | **2022** | **2023** | **2024<sup>(4)</sup>** |
|  | **(millions of dollars)** | **(millions of dollars)** | **(millions of dollars)** | **(millions of dollars)** | **(millions of dollars)** |
|  Current Account | 75902.2 | 85228.2 | 25828.6 | 32821.7 | 99042.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goods | 80604.8 | 75730.9 | 15620.0 | 37657.7 | 100126.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exports<sup>(2)</sup> | 517909.3 | 649475.2 | 694324.1 | 643577.2 | 696196.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Imports<sup>(2)</sup> | 437304.5 | 573744.3 | 678704.1 | 605919.5 | 596069.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Services | (14670.1) | (5286.7) | (7253.1) | (26824.1) | (23701.6) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income | 13486.9 | 19444.9 | 20347.1 | 26249.3 | 26619.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current Transfers | (3519.4) | (4660.9) | (2885.4) | (4261.2) | (4001.7) |
|  Capital and Financial Account | 80996.4 | 78335.3 | 27063.2 | 32129.1 | 95512.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital Account | (386.3) | (155.3) | 0.7 | 47.1 | 303.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial Account<sup>(3)</sup> | 81382.7 | 78490.6 | 27062.5 | 32082.0 | 95208.8 |
|  Net Errors and Omissions | 5866.8 | (6582.3) | 1233.2 | (786.8) | (4137.4) |

---

(1) Figures are prepared based on the sixth edition of the Balance of Payment Manual published by International
Monetary Fund in December 2010 and implemented by the Government in December 2013. In December 2018, The Bank of Korea revised the Republic's balance of payments information to capture new economic activities and reflect the changes in raw
data.

(2) These entries are derived from trade statistics and are valued on a free on board basis, meaning that the
insurance and freight costs are not included.

(3) Includes borrowings from the IMF, syndicated bank loans and short-term borrowings.

(4) Preliminary.

*Source:* The Bank of Korea

The current account surplus in 2023 increased to US$32.8 billion in 2023 from the current account surplus of US$25.8 billion in 2022, primarily due to an increase in surplus from the goods account, as well as an increase in surplus from the income account, the effects of which were offset in part by an increase in deficit from the services account. Based on preliminary data, the current account surplus in 2024 increased to US$99.0 billion in 2024 from the current account surplus of US$32.8 billion in 2023, primarily due to an increase in surplus from the goods account and a decrease in deficit from the services account.

***Foreign Direct Investment***

Since 1960, the Government has adopted a broad range of related laws, administrative rules and regulations that provide a framework for the conduct and regulation of foreign investment activities. In September 1998, the

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##### [**Table of Contents**](#toc)
Government promulgated the Foreign Investment Promotion Act, or the FIPA, which replaced previous foreign direct investment related laws, rules and regulations, to promote inbound foreign investments by providing incentives to, and facilitating investment activities in the Republic by, foreign nationals. The FIPA prescribes, among others, procedural requirements for inbound foreign investments, incentives for foreign investments such as tax reductions, and requirements relating to designation and development of foreign investment target regions. The Government believes that providing a stable and receptive environment for foreign direct investment will accelerate the inflow of foreign capital, technology and management techniques.

The following table sets forth information regarding annual foreign direct investment in the Republic for the periods indicated.

**Foreign Direct Investment** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024<sup>(2)</sup>** |
|  | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** |
|  Contracted and Reported Investment |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Greenfield Investment<sup>(1)</sup> | 14.5 | 18.1 | 22.3 | 23.5 | 26.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Merger & Acquisition | 6.2 | 11.4 | 8.1 | 9.2 | 7.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | 20.7 | 29.5 | 30.4 | 32.7 | 34.6 |
|  Actual Investment | 11.5 | 17.9 | 18.2 | 19.5 | 14.8 |

---

(1) Includes building new factories and operational facilities.

(2) Preliminary.

*Source:* Ministry of Trade, Industry and Energy

In 2023, the contracted and reported amount of foreign direct investment in the Republic increased to US$32.7 billion from US$30.4 billion in 2022, primarily due to an increase in foreign investment in the services sector to US$17.8 billion in 2023 from US$16.6 billion in 2022.

Based on preliminary data, in 2024, the contracted and reported amount of foreign direct investment in the Republic increased to US$34.6 billion from US$32.7 billion in 2023, primarily due to an increase in foreign investment in the manufacturing sector to US$14.5 billion in 2024 from US$11.9 billion in 2023.

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##### [**Table of Contents**](#toc)
The following table sets forth information regarding the source of foreign direct investment by region and country for the periods indicated:

**Foreign Direct Investment by Region and Country** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2020** | **2021** | **2022** | **2023** | **2024** |
|  | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** |
|  North America |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; U.S.A. | 5.3 | 5.3 | 8.7 | 6.1 | 5.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 3.5 | 1.6 | 5.8 | 6.5 | 5.5 |
|  | 8.8 | 6.9 | 14.5 | 12.6 | 10.7 |
|  Asia |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Japan | 0.8 | 1.2 | 1.5 | 1.3 | 6.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Hong Kong | 1.1 | 0.6 | 0.4 | 1.2 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Singapore | 2.3 | 4.2 | 3.2 | 2.7 | 2.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; China | 2 | 1.9 | 1.5 | 1.6 | 5.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 0.4 | 1.2 | 0.5 | 1.8 | 1 |
|  | 6.6 | 9.1 | 7.1 | 8.6 | 16.3 |
|  European Union |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Ireland | 0 | 1.8 | 0.1 | 0 | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Netherlands | 0.6 | 1 | 4.9 | 1.1 | 0.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Germany | 0.5 | 2.8 | 0.5 | 0.2 | 0.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; France | 0.2 | 0.2 | 0.2 | 1.2 | 0.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 2.7 | 6.2 | 1.8 | 3.7 | 3 |
|  | 4 | 12 | 7.5 | 6.2 | 5.1 |
|  Other regions and countries | 1.3 | 1.5 | 1.3 | 5.3 | 2.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | 20.7 | 29.5 | 30.4 | 32.7 | 34.6 |

---

*Source:* Ministry of Trade, Industry and Energy

***Trade Balance***

Trade balance figures measure the difference between a country's exports and imports. If exports exceed imports the country has a trade balance surplus while if imports exceed exports the country has a deficit. A deficit, indicating that a country's receipts from abroad fall short of its payments to foreigners, must be financed, rendering the country a debtor nation. A surplus, indicating that a country's receipts exceed its payments to foreigners, allows the country to finance its trading partners' net deficit to the extent of the surplus, rendering the country a creditor nation.

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##### [**Table of Contents**](#toc)
The following table summarizes the Republic's trade balance for the periods indicated:

**Trade Balance** 

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Exports<sup>(1)</sup>** | **As %<br>of<br>GDP<sup>(2)</sup>** | **Imports<sup>(1)</sup>** | **As %<br>of<br>GDP<sup>(2)</sup>** | **Balance of<br>Trade** | **Exports as %<br>of Imports** |
|  | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** |
| 2020 | 512.5 | 29.4% | 467.6 | 26.8% | 44.9 | 109.6 |
| 2021 | 644.4 | 33.2% | 615.1 | 31.7% | 29.3 | 104.8 |
| 2022 | 683.6 | 38.0% | 731.4 | 40.7% | (47.8) | 93.5 |
| 2023 | 632.2 | 34.4% | 642.6 | 34.9% | (10.4) | 98.4 |
| 2024<sup>(3)</sup> | 683.7 | 36.6% | 632.1 | 33.8% | 51.6 | 108.2 |

---

(1) These entries are derived from customs clearance statistics on a C.I.F. basis, meaning that the price of goods
includes insurance and freight cost.

(2) At current market prices.

(3) Preliminary.

*Source:* The Bank of Korea; Korea Customs Service

The Republic, due to its lack of natural resources, relies on extensive trading activity for growth. The country meets virtually all domestic requirements for petroleum, wood and rubber with imports, as well as much of its coal and iron needs. Exports consistently represent a high percentage of GDP and, accordingly, the international economic environment is of crucial importance to the Republic's economy. See "—The Economy—Worldwide Economic and Financial Difficulties".

The following tables give information regarding the Republic's exports and imports by major commodity groups:

**Exports by Major Commodity Groups (C.I.F.)<sup>(1)</sup>** 

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2020** | **As % of<br>2020<br>Total** | **2021** | **As % of<br>2021<br>Total** | **2022** | **As % of<br>2022<br>Total** | **2023** | **As % of<br>2023<br>Total** | **2024<sup>(2)</sup>** | **As % of<br>2024<br>Total<sup>(2)</sup>** |
|  | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** |
|  Foods & Consumer Goods | 8.6 | 1.7 | 9.8 | 1.5 | 10.4 | 1.5 | 10.7 | 1.7 | 11.6 | 1.7 |
|  Raw Materials and Fuels | 32.1 | 6.3 | 51.4 | 8.0 | 75.1 | 11.0 | 62.6 | 9.9 | 60.9 | 8.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Petroleum & Derivatives | 24.7 | 4.8 | 38.8 | 6.0 | 63.3 | 9.3 | 52.4 | 8.3 | 50.7 | 7.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 7.4 | 1.4 | 12.6 | 2.0 | 11.8 | 1.7 | 10.2 | 1.6 | 10.2 | 1.5 |
|  Light Industrial Products | 32.4 | 6.3 | 35.3 | 5.5 | 35.2 | 5.1 | 33.4 | 5.3 | 34.2 | 5.0 |
|  Heavy & Chemical Industrial Products | 439.3 | 85.7 | 547.9 | 85.0 | 563.0 | 82.4 | 525.5 | 83.1 | 577.0 | 84.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electronic & Electronic Products | 178.5 | 34.8 | 221.8 | 34.4 | 224.2 | 32.8 | 181.1 | 28.6 | 231.0 | 33.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Chemicals & Chemical Products | 66.6 | 13.0 | 91.9 | 14.3 | 98.0 | 14.3 | 86.6 | 13.7 | 83.6 | 12.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Metal Goods | 39.6 | 7.7 | 52.6 | 8.2 | 55.3 | 8.1 | 49.8 | 7.9 | 48.2 | 7.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Machinery & Precision Equipment | 63.4 | 12.4 | 70.9 | 11.0 | 70.9 | 10.4 | 72.6 | 11.5 | 72.5 | 10.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transport Equipment | 77.6 | 15.1 | 94.2 | 14.6 | 98.4 | 14.4 | 118.2 | 18.7 | 120.6 | 17.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Passenger Cars | 35.6 | 6.9 | 44.3 | 6.9 | 51.7 | 7.6 | 68.3 | 10.8 | 68.3 | 10.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Ships & Boats | 19.2 | 3.7 | 22.4 | 3.5 | 17.6 | 2.6 | 20.8 | 3.3 | 24.5 | 3.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 22.8 | 4.4 | 27.5 | 4.3 | 29.2 | 4.3 | 29.1 | 4.6 | 27.8 | 4.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 13.6 | 2.7 | 16.6 | 2.6 | 16.1 | 2.4 | 17.2 | 2.7 | 21.2 | 3.1 |
|  Total | 512.5 | 100.0 | 644.4 | 100.0 | 683.6 | 100.0 | 632.2 | 100.0 | 683.7 | 100.0 |

---

(1) These entries are derived from customs clearance statistics. C.I.F. means that the price of goods includes
insurance and freight costs.

(2) Preliminary.

*Source:* The Bank of Korea; Korea Customs Service

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##### [**Table of Contents**](#toc)
**Imports by Major Commodity Groups (C.I.F.)<sup>(1)</sup>** 

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2020** | **As % of<br>2020<br>Total** | **2021** | **As % of<br>2021<br>Total** | **2022** | **As % of<br>2022<br>Total** | **2023** | **As % of<br>2023<br>Total** | **2024<sup>(2)</sup>** | **As % of<br>2024<br>Total<sup>(2)</sup>** |
|  | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | **(billions of dollars, except percentages)** | | |
|  Industrial Materials and Fuels | 206.3 | 44.1 | 302.6 | 49.2 | 393.8 | 53.8 | 328.4 | 51.1 | 308.3 | 48.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Crude Petroleum | 44.5 | 9.5 | 67.0 | 10.9 | 106.0 | 14.5 | 86.2 | 13.4 | 85.4 | 13.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mineral | 21.4 | 4.6 | 33.3 | 5.4 | 31.3 | 4.3 | 27.1 | 4.2 | 25.9 | 4.1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Chemicals | 46.4 | 9.9 | 60.4 | 9.8 | 70.2 | 9.6 | 64.8 | 10.1 | 55.5 | 8.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Iron & Steel Products | 15.2 | 3.3 | 22.2 | 3.6 | 22.7 | 3.1 | 21.3 | 3.3 | 20.5 | 3.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-ferrous Metal | 11.7 | 2.5 | 18.4 | 3.0 | 19.5 | 2.7 | 15.9 | 2.5 | 15.9 | 2.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 67.1 | 14.3 | 101.3 | 16.5 | 144.1 | 19.7 | 113.1 | 17.6 | 105.1 | 16.6 |
|  Capital Goods | 177.1 | 37.9 | 212.8 | 34.6 | 228.9 | 31.3 | 211.5 | 32.9 | 222.3 | 35.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Machinery & Precision Equipment | 57.9 | 12.4 | 70.0 | 11.4 | 68.6 | 9.4 | 66.1 | 10.3 | 67.8 | 10.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electric & Electronic Machines | 105.1 | 22.5 | 127.6 | 20.7 | 144.8 | 19.8 | 129.3 | 20.1 | 135.7 | 21.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Transport Equipment | 11.9 | 2.5 | 13.0 | 2.1 | 13.2 | 1.8 | 13.7 | 2.1 | 16.3 | 2.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Others | 2.3 | 0.5 | 2.2 | 0.4 | 2.3 | 0.3 | 2.4 | 0.4 | 2.5 | 0.4 |
|  Consumer Goods | 84.2 | 18.0 | 99.6 | 16.2 | 108.7 | 14.9 | 102.7 | 16.0 | 101.4 | 16.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cereals | 7.1 | 1.5 | 8.9 | 1.4 | 11.3 | 1.5 | 9.8 | 1.5 | 8.7 | 1.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Goods for Direct Consumption | 22.3 | 4.8 | 25.7 | 4.2 | 29.0 | 4.0 | 27.5 | 4.3 | 27.7 | 4.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Durable Consumer Goods | 34.9 | 7.5 | 42.2 | 6.9 | 42.8 | 5.9 | 40.7 | 6.3 | 40.4 | 6.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Nondurable Consumer Goods | 20.0 | 4.3 | 22.8 | 3.7 | 25.6 | 3.5 | 24.7 | 3.8 | 24.6 | 3.9 |
|  Total | 467.6 | 100.0 | 615.1 | 100.0 | 731.4 | 100.0 | 642.6 | 100.0 | 632.1 | 100.0 |

---

(1) These entries are derived from customs clearance statistics. C.I.F. means that the price of goods includes
insurance and freight costs.

(2) Preliminary.

*Source:* The Bank of Korea; Korea Customs Service

In 2020, the Republic recorded a trade surplus of US$44.9 billion. Exports decreased by 5.5% to US$512.5 billion in 2020 from US$542.2 billion in 2019, primarily due to a slowdown of the global economy resulting from the COVID-19 pandemic. Imports decreased by 7.1% to US$467.6 billion in 2020 from US$503.3 billion in 2019, primarily due to a decrease in oil prices, which also led to decreased unit prices of other major raw materials, as well as decreased domestic consumption, which were mainly attributed to the COVID-19 pandemic.

In 2021, the Republic recorded a trade surplus of US$29.3 billion. Exports increased by 25.7% to US$644.4 billion in 2021 from US$512.5 billion in 2020, primarily due to a recovery of the global economy from the COVID-19 pandemic. Imports increased by 31.5% to US$615.1 billion in 2021 from US$467.6 billion in 2020, primarily due to an increase in domestic consumption as well as an increase in oil prices, which also led to increased unit prices of other major raw materials.

In 2022, the Republic recorded a trade deficit of US$47.8 billion. Exports increased by 6.1% to US$683.6 billion in 2022 from US$644.4 billion in 2021, primarily due to an improvement in the domestic economic conditions of the Republic's major trading partners. Imports increased by 18.9% to US$731.4 billion in 2022 from US$615.1 billion in 2021, primarily due to an increase in energy and commodity prices, which also led to increased unit prices of other major raw materials.

In 2023, the Republic recorded a trade deficit of US$10.4 billion. Exports decreased by 7.5% to US$632.2 billion in 2023 from US$683.6 billion in 2022, primarily due to a deterioration in the domestic economic conditions of the Republic's major trading partners and a downturn in the semiconductor industry. Imports decreased by 12.1% to US$642.6 billion in 2023 from US$731.4 billion in 2022, primarily due to a decrease in energy and commodity prices, which also led to decreased unit prices of other major raw materials.

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Based on preliminary data, in 2024, the Republic recorded a trade surplus of US$51.6 billion. Exports increased by 8.1% to US$683.7 billion in 2024 from US$632.2 billion in 2023, primarily due to a substantial growth in demand for semiconductor products globally and a general improvement in the domestic economic conditions of the Republic's major trading partners. Imports decreased by 1.6% to US$632.1 billion in 2024 from US$642.6 billion in 2023, primarily due to a decrease in oil prices, which also led to decreased unit prices of other major raw materials.

The following table sets forth the Republic's exports trading partners:

**Exports** 

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2020** | **As % of<br>2020<br>Total** | **2021** | **As % of<br>2021<br>Total** | **2022** | **As % of<br>2022<br>Total** | **2023** | **As % of<br>2023<br>Total** | **2024<sup>(1)</sup>** | **As % of<br>2024<br>Total<sup>(1)</sup>** |
|  | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** |
|  China | 132565.4 | 25.9 | 162913.0 | 25.3 | 155789.4 | 22.8 | 124817.7 | 19.7 | 133036.3 | 19.5 |
|  United States | 74115.8 | 14.5 | 95902.0 | 14.9 | 109765.7 | 16.1 | 115696.3 | 18.3 | 127786.5 | 18.7 |
|  Japan | 25097.7 | 4.9 | 30061.8 | 4.7 | 30606.3 | 4.5 | 29000.6 | 4.6 | 29606.7 | 4.3 |
|  Hong Kong | 30653.8 | 6.0 | 37467.1 | 5.8 | 27651.2 | 4.0 | 25193.6 | 4.0 | 35022.8 | 5.1 |
|  Singapore | 9828.4 | 1.9 | 14148.5 | 2.2 | 20205.4 | 3.0 | 18752.0 | 3.0 | 18216.1 | 2.7 |
|  Vietnam | 48510.6 | 9.5 | 56728.5 | 8.8 | 60963.7 | 8.9 | 53479.5 | 8.5 | 58321.3 | 8.5 |
|  Taiwan | 16465.4 | 3.2 | 24285.3 | 3.8 | 26198.2 | 3.8 | 20178.8 | 3.2 | 33960.9 | 5.0 |
|  India | 11937.3 | 2.3 | 15603.3 | 2.4 | 18870.1 | 2.8 | 17949.6 | 2.8 | 18695.7 | 2.7 |
|  Indonesia | 6312.9 | 1.2 | 8550.3 | 1.3 | 10215.9 | 1.5 | 9140.2 | 1.4 | 7944.0 | 1.2 |
|  Mexico | 8241.0 | 1.6 | 11290.2 | 1.8 | 12654.2 | 1.9 | 12222.0 | 1.9 | 13607.2 | 2.0 |
|  Australia | 6188.5 | 1.2 | 9750.5 | 1.5 | 18753.0 | 2.7 | 17791.4 | 2.8 | 15593.1 | 2.3 |
|  Germany | 9576.1 | 1.9 | 11109.9 | 1.7 | 10067.7 | 1.5 | 10317.1 | 1.6 | 9037.9 | 1.3 |
|  Others<sup>(2)</sup> | 133005.1 | 26.0 | 166590.0 | 25.9 | 181844.0 | 26.6 | 177687.0 | 28.1 | 182863.1 | 26.7 |
|  Total | 512498.0 | 100.0 | 644400.4 | 100.0 | 683584.8 | 100.0 | 632225.8 | 100.0 | 683691.6 | 100.0 |

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(1) Preliminary.

(2) Includes more than 200 countries and regions.

*Source:* The Bank of Korea; Korea Customs Service

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##### [**Table of Contents**](#toc)
The following table sets forth the Republic's imports trading partners:

**Imports** 

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **2020** | **As % of<br>2020<br>Total** | **2021** | **As % of<br>2021<br>Total** | **2022** | **As % of<br>2022<br>Total** | **2023** | **As % of<br>2023<br>Total** | **2024<sup>(1)</sup>** | **As % of<br>2024<br>Total<sup>(1)</sup>** |
|  | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** | **(millions of dollars, except percentages)** |
|  China | 108884.6 | 23.3 | 138628.1 | 22.5 | 154576.3 | 21.1 | 142857.3 | 22.2 | 139867.8 | 22.1 |
|  Japan | 46023.0 | 9.8 | 54642.2 | 8.9 | 54711.8 | 7.5 | 47656.5 | 7.4 | 47898.7 | 7.6 |
|  United States | 57492.2 | 12.3 | 73213.4 | 11.9 | 81784.7 | 11.2 | 71272.0 | 11.1 | 72121.4 | 11.4 |
|  Saudi Arabia | 15979.6 | 3.4 | 24271.3 | 3.9 | 41640.3 | 5.7 | 32762.5 | 5.1 | 31502.2 | 5.0 |
|  Qatar | 7562.1 | 1.6 | 11611.1 | 1.9 | 16567.2 | 2.3 | 14998.9 | 2.3 | 14211.0 | 2.2 |
|  Australia | 18707.1 | 4.0 | 32918.0 | 5.4 | 44929.4 | 6.1 | 32823.0 | 5.1 | 29956.3 | 4.7 |
|  Germany | 20680.9 | 4.4 | 21996.3 | 3.6 | 23614.9 | 3.2 | 23611.2 | 3.7 | 22301.0 | 3.5 |
|  Kuwait | 5827.9 | 1.2 | 8253.9 | 1.3 | 12401.9 | 1.7 | 9659.0 | 1.5 | 8786.8 | 1.4 |
|  Taiwan | 17837.0 | 3.8 | 23485.8 | 3.8 | 28274.6 | 3.9 | 24370.6 | 3.8 | 30222.5 | 4.8 |
|  United Arab Emirates | 5692.7 | 1.2 | 7318.7 | 1.2 | 15492.8 | 2.1 | 16422.8 | 2.6 | 17988.2 | 2.8 |
|  Indonesia | 7594.7 | 1.6 | 10725.1 | 1.7 | 15734.9 | 2.2 | 12145.9 | 1.9 | 12569.0 | 2.0 |
|  Malaysia | 8892.6 | 1.9 | 10456.2 | 1.7 | 15249.1 | 2.1 | 15237.1 | 2.4 | 13982.0 | 2.2 |
|  Others<sup>(2)</sup> | 146458.4 | 31.3 | 197573.3 | 32.1 | 226391.8 | 31.0 | 198755.3 | 30.9 | 190693.1 | 30.2 |
|  Total | 467632.8 | 100.0 | 615093.4 | 100.0 | 731369.7 | 100.0 | 642572.1 | 100.0 | 632100.0 | 100.0 |

---

(1) Preliminary.

(2) Includes more than 200 countries and regions.

*Source:* The Bank of Korea; Korea Customs Service

In recent years, the value of the Won relative to the U.S. dollar has depreciated significantly, in particular due to the impact of the COVID-19 pandemic, the Russia-Ukraine war and ensuing sanctions against Russia and the escalating hostilities in the Middle East following the Israel-Hamas war and, more recently, the political situation in Korea relating to the impeachment of former President Yoon in April 2025 following his declaration of martial law in December 2024, among others. See "—The Economy—Worldwide Economic and Financial Difficulties". An appreciation of the Won against the U.S. dollar increases the Won value of the Republic's export sales and diminishes the price-competitiveness of export goods in foreign markets in U.S. dollar terms. However, it also decreases the cost of imported raw materials in Won terms and the cost in Won of servicing the Republic's U.S. dollar-denominated debt. In general, when the Won appreciates, export dependent sectors of the Korean economy, including automobiles, electronics and shipbuilding, suffer from the resulting pressure on the price-competitiveness of export goods, which may lead to reduced profit margins and loss in market share, more than offsetting a decrease in the cost of imported raw materials. If the export dependent sectors of the Korean economy suffer reduced profit margins or a net loss, it could result in a material adverse effect on the Korean economy.

Since the Government announced its plans to pursue free trade agreements, or FTAs, in 2003, the Republic has entered into FTAs with key trading partners. The Republic has had bilateral FTAs in effect with Chile since 2004, Singapore since 2006, India since 2010, Peru since 2011, the United States since 2012, Turkey since 2013, Australia since 2014, Canada, China, New Zealand and Vietnam since 2015, Colombia since July 2016, the United Kingdom since January 2021, Israel and Cambodia since December 2022, Indonesia since January 2023 and the Philippines since 2024. The Republic is currently in negotiations with a number of other key trading partners. In addition, the Republic has had regional FTAs in effect with the European Free Trade Association since 2006, the Association of Southeast Asian Nations since 2009, the European Union since 2011, with each of Panama, Costa Rica, Guatemala, Honduras, El Salvador and Nicaragua since 2021 and with the Regional Comprehensive Economic Partnership since 2022, and is currently negotiating additional regional FTAs. The

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##### [**Table of Contents**](#toc)
Republic and Turkey have completed revisions to their bilateral FTA, which became effective in August 2018. The Republic and the United States have also completed revisions to their bilateral FTA, which became effective in January 2019.

***Non-Commodities Trade Balance***

The Republic had non-commodities trade deficits of US$4.7 billion in 2020, non-commodities trade surpluses of US$9.5 billion in 2021 and US$10.2 billion in 2022, and non-commodities trade deficits of US$4.8 billion in 2023. Based on preliminary data, the Republic had non-commodities trade deficits of US$1.1 billion in 2024.

***Foreign Currency Reserves***

The foreign currency reserves are external assets that are readily available to and controlled by monetary authorities for meeting balance of payments financing needs and for other related purposes. The following table shows the Republic's total official foreign currency reserves:

**Total Official Reserves** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** |
|  | **2020** | **2021** | **2022** | **2023** | **2024** |
|  | **(millions of dollars)** | **(millions of dollars)** | **(millions of dollars)** | **(millions of dollars)** | **(millions of dollars)** |
|  Gold | $4794.8 | $4794.8 | $4794.8 | $4794.8 | $4794.8 |
|  Foreign Exchange<sup>(1)</sup> | 430117.2 | 438319.2 | 399043.1 | 395643.3 | 391889.9 |
|  Total Gold and Foreign Exchange | 434912.0 | 443114.0 | 403837.9 | 400438.1 | 396684.7 |
|  Reserve Position at IMF | 4815.3 | 4634.9 | 4489.5 | 4627.8 | 4204.9 |
|  Special Drawing Rights | 3370.8 | 15369.5 | 14836.3 | 15082.1 | 14714.1 |
|  Total Official Reserves | $443098.1 | $463118.4 | $423163.7 | $420147.9 | $415603.8 |

---

(1) More than 95% of the Republic's foreign currency reserves are comprised of convertible foreign currencies.

*Source:* The Bank of Korea; International Monetary Fund

The Government's foreign currency reserves increased to US$262.2 billion as of December 31, 2007 from US$8.9 billion as of December 31, 1997, primarily due to continued balance of trade surpluses and capital inflows. In 2008, the Government's foreign currency reserves decreased, falling to US$201.2 billion as of December 31, 2008, partially as a result of the Government's use of the foreign currency reserve to provide foreign currency liquidity to Korean financial institutions. The Government's foreign currency reserves increased to US$443.1 billion as of December 31, 2020 and US$463.1 billion as of December 31, 2021, primarily due to continued trade surpluses and capital inflows. The Government's foreign currency reserves decreased to US$423.2 billion as of December 31, 2022, US$420.1 billion as of December 31, 2023 and US$415.6 billion as of December 31, 2024, however, primarily in relation to the depreciation of the Won against the U.S. dollar. The amount of the Government's foreign currency reserve was US$409.7 billion as of March 31, 2025.

**Government Finance** 

The Ministry of Economy and Finance prepares the Government budget and administers the Government's finances.

The Government's fiscal year commences on January 1. The Government must submit the budget, which is drafted by the Minister of Economy and Finance and approved by the President of the Republic, to the National Assembly not later than 90 days prior to the start of the fiscal year and may submit supplementary budgets revising the original budget at any time during the fiscal year.

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##### [**Table of Contents**](#toc)
2023 budgeted revenues increased by 13.7% to W588.6 trillion from W517.7 trillion in 2022, led by an increase in budgeted tax revenues (including taxes on income, profits and capital gains). 2023 budgeted expenditures and net lending increased by 5.2% to W601.6 trillion from W571.8 trillion in 2022, led by increases in budgeted expenditures on revitalization of the economy. The 2023 budget anticipated a W13.1 trillion budget deficit.

2024 budgeted revenues decreased by 2.6% to W573.3 trillion from W588.6 trillion in 2023, led by a decrease in budgeted tax revenues (including taxes on income, profits and capital gains). 2024 budgeted expenditures and net lending increased by 2.7% to W617.7 trillion from W601.6 trillion in 2023, led by increases in budgeted expenditures on revitalization of the economy. The 2024 budget anticipated a W44.4 trillion budget deficit.

2025 budgeted revenues increased by 6.3% to W609.4 trillion from W573.3 trillion in 2024, led by increases in budgeted tax revenues (including taxes on income, profits and capital gains). 2025 budgeted expenditures and net lending increased by 2.2% to W631.1 trillion from W617.7 trillion in 2024, led by increases in budgeted expenditures on revitalization of the economy. The 2025 budget anticipated a W21.7 trillion budget deficit.

Beginning in March 2020, the National Assembly approved a series of supplementary budgets as part of the Government's efforts to mitigate adverse effects on the Korean economy resulting from the COVID-19 pandemic. See "—The Economy—Worldwide Economic and Financial Difficulties". These supplementary budgets, which amounted to W66.8 trillion in 2020, W49.8 trillion in 2021 and W78.9 trillion in 2022, were some of the largest of their kind drawn up in response to an outbreak of an infectious disease in Korea. The supplementary budgets were funded through the issuance of treasury bonds by the Government, The Bank of Korea's unappropriated surplus and other surplus funds available to the Government, among others.

Any significant increase in additional spending measures may lead to a budget deficit for 2025, which could result in a deterioration in the Government's fiscal position and an increase in borrowings.

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##### [**Table of Contents**](#toc)
The following table shows consolidated Government revenues and expenditures:

**Consolidated Central Government Revenues and Expenditures** 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Actual** | **Actual** | **Actual** | **Actual** | **Actual** | **Budget** | **Budget** | **Budget** |
|  | **2020** | **2021** | **2022** | **2023** | **2024<sup>(1)</sup>** | **2023** | **2024** | **2025<sup>(1)</sup>** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Total Revenues | 446628 | 537619 | 588332 | 543586 | 560088 | 588577 | 573261 | 609351 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current Revenues | 443694 | 534999 | 585325 | 539887 | 556112 | 584672 | 569507 | 601063 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Tax Revenues | 360129 | 422182 | 479384 | 432989 | 429335 | 486573 | 459643 | 478925 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Taxes on income, profits and capital gains | 148622 | 184509 | 232319 | 196253 | 179929 | 236860 | 203425 | 215074 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Social security contributions | 74583 | 78104 | 83444 | 88918 | 92802 | 86116 | 92329 | 96496 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tax on property | 22735 | 31392 | 27696 | 25311 | 24243 | 27815 | 24149 | 22473 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Taxes on goods and services | 91047 | 99840 | 105828 | 97008 | 105610 | 107760 | 110503 | 115619 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Taxes on international trade and transaction | 7059 | 8227 | 10324 | 7288 | 6972 | 10724 | 8907 | 8409 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other tax | 16084 | 20110 | 19773 | 18211 | 19778 | 17299 | 20330 | 20855 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-Tax Revenues | 83565 | 112818 | 105941 | 106898 | 126787 | 98099 | 109864 | 122138 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating surpluses of departmental enterprise sales and property income | 33571 | 56664 | 47459 | 42537 | 56969 | 36492 | 41432 | 51959 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Administration fees & charges and non-industrial sales | 9929 | 10865 | 11434 | 12428 | 12787 | 12470 | 13357 | 13913 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fines and forfeits | 23583 | 26993 | 28276 | 29752 | 32997 | 27816 | 30829 | 31107 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contributions to government employee pension fund | 13876 | 14918 | 16348 | 18149 | 19988 | 18480 | 20322 | 21196 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current revenue of non-financial public enterprises | 2606 | 3378 | 2425 | 4032 | 4046 | 2842 | 3925 | 3964 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital Revenues | 2934 | 2620 | 3007 | 3700 | 3966 | 3905 | 3754 | 8288 |
|  Total Expenditures and Net Lending | 517781 | 568113 | 652902 | 580354 | 603609 | 601629 | 617664 | 631091 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Expenditures | 489966 | 538034 | 622997 | 559707 | 580113 | 584587 | 593643 | 615040 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current Expenditures | 455098 | 502191 | 585593 | 523270 | 542859 | 545493 | 553669 | 576081 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Expenditure on goods and service | 79460 | 88144 | 89759 | 90389 | 93217 | 94966 | 98053 | 97971 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest payment | 14452 | 15431 | 18481 | 22362 | 26310 | 21726 | 24968 | 27530 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Subsidies and other current transfers | 357295 | 395826 | 473661 | 405733 | 417643 | 424353 | 425078 | 445013 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current expenditure of non-financial public enterprises | 3891 | 2790 | 3692 | 4785 | 5688 | 4449 | 5570 | 5567 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital Expenditures | 34868 | 35842 | 37404 | 36437 | 37254 | 39094 | 39974 | 38959 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net Lending | 27815 | 30079 | 29905 | 20647 | 23496 | 17042 | 24021 | 16051 |

---

(1) Preliminary.

*Source:* Ministry of Economy and Finance; The Bank of Korea; Korea National Statistical Office

The consolidated Government account consists of a General Account, Special Accounts (including a non-financial public enterprise special account) and Public Funds. The Government segregates the accounts of certain functions of the Government into Special Accounts and Public Funds for more effective administration and fiscal control. The Special Accounts and Public Funds relate to business type activities, such as economic development, road and railway construction and maintenance, monopolies, and communications developments and the administration of loans received from official international financial organizations and foreign governments.

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Revenues derive mainly from national taxes and non-tax revenues. Taxes in Korea can be roughly classified into the following types:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• income tax and capital gains tax,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• property tax,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• value-added tax,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• customs duty tax, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other taxes.

Income tax and capital gains tax are imposed on income derived from labor, business operation and ownership of assets and profits derived from capital appreciation. Income tax and capital gains tax, depending on the type of taxpayer, can be further classified into corporate income tax and individual income tax. Property tax is imposed on exchange or ownership of property and includes inheritance tax and gift tax. Value-added tax is imposed on value added to goods and services. Customs duty tax is imposed on imported goods. Other taxes include tax on certain securities transactions and a stamp tax for certain documents.

Expenditures include general administration, national defense, community service, education, health, social security, certain annuities and pensions and local finance, which involves the transfer of tax revenues to local governments.

For 2020, the Republic recorded total revenues of W446.6 trillion and total expenditures and net lending of W517.8 trillion. The Republic had a fiscal deficit of W71.2 trillion in 2020.

For 2021, the Republic recorded total revenues of W537.6 trillion and total expenditures and net lending of W568.1 trillion. The Republic had a fiscal deficit of W30.5 trillion in 2021.

For 2022, the Republic recorded total revenues of W588.3 trillion and total expenditures and net lending of W652.9 trillion. The Republic had a fiscal deficit of W64.6 trillion in 2022.

For 2023, the Republic recorded total revenues of W543.6 trillion and total expenditures and net lending of W580.4 trillion in 2023. The Republic had a fiscal deficit of W36.8 trillion in 2023.

Based on preliminary data, the Republic recorded total revenues of W560.1 trillion and total expenditures and net lending of W603.6 trillion in 2024. The Republic had a fiscal deficit of W43.5 trillion in 2024.

**Debt** 

The Government estimates that the total outstanding debt of the Government (including guarantees by the Government) as of December 31, 2022 amounted to approximately W1,044.0 trillion, an increase of 9.9% over the previous year.

The Government estimates that the total outstanding debt of the Government (including guarantees by the Government) as of December 31, 2023 amounted to approximately W1,102.1 trillion, an increase of 5.6% over the previous year.

The Ministry of Economy and Finance administers the national debt of the Republic.

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***External and Internal Debt of the Government***

The following table sets out, by currency and the equivalent amount in U.S. dollars, the estimated outstanding direct external debt of the Government as of December 31, 2023:

**Direct External Debt of the Government** 

---

| | | | |
|:---|:---|:---|:---|
|  | **Amount in<br>Original<br>Currency** | **Equivalent<br>Amount in<br>U.S. Dollars<sup>(1)</sup>** | **Equivalent<br>Amount in<br>U.S. Dollars<sup>(1)</sup>** |
|  | **(millions)** | **(millions)** | **(millions)** |
|  US$ | US$6,025.0 | US$ | 6025.0 |
|  Euro (EUR) | EUR2,150.0 |  | 2378.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total |  | US$ | 8403.8 |

---

(1) Amounts expressed in currencies other than US$ are converted to US$ at the arbitrage rate announced by the Seoul
Money Brokerage Services, Ltd. in effect on December 29, 2023.

The following table summarizes, as of December 31 of the years indicated, the outstanding direct internal debt of the Republic:

**Direct Internal Debt of the Government** 

---

| | | |
|:---|:---|:---|
|  | **(billions of Won)** | **(billions of Won)** |
|  2019 |  | 690524.1 |
|  2020 |  | 808941.0 |
|  2021 |  | 927865.2 |
|  2022 |  | 1021574.4 |
|  2023 |  | 1080844.4 |

---

The following table sets out all guarantees by the Government of indebtedness of others:

**Guarantees by the Government** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** |
|  | **2019** | **2020** | **2021** | **2022** | **2023** |
|  | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** | **(billions of Won)** |
|  Domestic | 14760.0 | 12490.0 | 10930.0 | 10620.0 | 10460.0 |
|  External<sup>(1)</sup> |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total | 14760.0 | 12490.0 | 10930.0 | 10620.0 | 10460.0 |

---

(1) Converted to Won at foreign exchange banks' telegraphed transfer selling rates to customers or the market
average exchange rates in effect on December 31 of each year.

For further information on the outstanding indebtedness, including guarantees, of the Republic, see "—Tables and Supplementary Information".

***External Liabilities***

The following tables set out certain information regarding the Republic's external liabilities calculated under the criteria based on the sixth edition of the Balance of Payment Manual published by the International

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##### [**Table of Contents**](#toc)
Monetary Fund in December 2010 and implemented by the Government in December 2013. Under BPM6, in particular, prepayments received in connection with the construction of ships are excluded from the external liabilities.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** |
|  | **2020** | **2021** | **2022** | **2023** | **2024<sup>(1)</sup>** |
|  | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** | **(billions of dollars)** |
|  Long-term Liabilities | 390.6 | 465.6 | 499.3 | 531.9 | 523.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; General Government | 119.4 | 144.4 | 153.2 | 170.8 | 160.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Monetary Authorities | 15.0 | 35.9 | 25.0 | 22.5 | 23.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banks | 112.2 | 128.1 | 146.8 | 147.6 | 137.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other Sectors | 144.0 | 157.2 | 174.2 | 190.9 | 202.1 |
|  Short-term Liabilities | 160.1 | 165.1 | 174.0 | 140.7 | 146.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; General Government | 2.1 | 1.6 | 3.9 | 1.6 | 2.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Monetary Authorities | 10.8 | 9.7 | 4.7 | 3.9 | 3.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Banks | 122.0 | 124.3 | 129.7 | 101.9 | 107.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other Sectors | 25.2 | 29.6 | 35.6 | 33.3 | 33.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total External Liabilities** | 550.6 | 630.7 | 673.3 | 672.5 | 670.0 |

---

(1) Preliminary.

***Commitments to Assume Treasury Obligations***

The Government may, if deemed necessary for recovery from disasters and calamities, make commitments to assume treasury obligations to the extent resolved by the National Assembly each fiscal year. In such cases, such commitments shall be executed in accordance with the procedures for spending reserve funds within general accounts.

***Debt Record***

The Government has always paid when due the full amount of principal of, interest on, and amortization of sinking fund requirements of, all of its indebtedness.

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##### [**Table of Contents**](#toc)
**Tables and Supplementary Information** 

&nbsp;&nbsp;&nbsp;&nbsp;***A. External Debt of the Government***

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(1) External Bonds of the Government* 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Series** | **Issue Date** | **Maturity Date** | **Interest<br>Rate (%)** | **Currency** | **Original<br>Principal<br>Amount** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** | **Principal Amount<br>Outstanding as of<br>December 31, 2024** |
| 2005-001 | November 2, 2005 | November 3, 2025 | 5.625 | USD | 400000000 |  | 400000000 |
| 2014-001 | June 10, 2014 | June 10, 2044 | 4.125 | USD | 1000000000 |  | 1000000000 |
| 2017-001 | January 19, 2017 | January 19, 2027 | 2.750 | USD | 1000000000 |  | 1000000000 |
| 2018-001 | September 20, 2018 | September 20, 2028 | 3.500 | USD | 500000000 |  | 500000000 |
| 2018-002 | September 20, 2018 | September 20, 2048 | 3.875 | USD | 500000000 |  | 500000000 |
| 2019-001 | June 19, 2019 | June 19, 2029 | 2.500 | USD | 1000000000 |  | 1000000000 |
| 2020-001 | September 16, 2020 | September 16, 2030 | 1.000 | USD | 625000000 |  | 625000000 |
| 2020-002 | September 16, 2020 | September 16, 2025 | 0.000 | EUR | 700000000 |  | 700000000 |
| 2021-001 | October 15, 2021 | October 15, 2026 | 0.000 | EUR | 700000000 |  | 700000000 |
| 2021-002 | October 15, 2021 | October 15, 2031 | 1.750 | USD | 500000000 |  | 500000000 |
| 2024-001 | July 3, 2024 | July 3, 2029 | 4.500 | USD | 1000000000 |  | 1000000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Original Currencies | USD | 7925000000 |
|  |  |  |  |  |  | EUR | 1400000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total External Bonds in Equivalent Amount of Won<sup>(1)</sup> | W | 13789930000000 |

---

(1) U.S. dollar amounts are converted to Won amounts at the rate of US$1.00 to W 1,470.0, the market
average exchange rate in effect on December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd. Euro amounts are converted to Won amounts at the rate of EUR 1.00 to W 1,528.7, the market average exchange rate in effect on
December 31, 2024, as announced by Seoul Money Brokerage Services, Ltd.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(2) External Borrowings of the Government* 

None.

&nbsp;&nbsp;&nbsp;&nbsp;***B. External Guaranteed Debt of the Government***

None.

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&nbsp;&nbsp;&nbsp;&nbsp;***C. Internal Debt of the Government***

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Title** | **Range of<br>Interest Rates** | **Range of<br>Years of Issue** | **Range of Years<br>of Original<br>Maturity** | **Principal<br>Amounts<br>Outstanding as<br>of December 31,<br>2023** |
|  | **(%)** | | | **(billions of Won)** |
| **1. Bonds** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-Bearing Treasury Bond for Treasury Bond Management Fund | 0.750-5.750 | 2006-2023 | 2024-2072 | 998003.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-Bearing Treasury Bond for National Housing I | 1.00-2.00 | 2019-2023 | 2024-2029 | 81624.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-Bearing Treasury Bond for National Housing II | 0.0-3 | 2014-2020 | 2024-2030 | 2.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest-Bearing Treasury Bond for National Housing III |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-interest-Bearing Treasury Bond for Contribution to International Organizations<sup>(1)</sup> | 0 | 1968-1985 |  | 9.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Bonds |  |  |  | 1079639.4 |
| **2. Borrowings** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from The Bank of Korea |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Sports Promotion Fund | 1.870-3.665 | 2022-2023 | 2024-2025 | 960 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from The Korea Foundation Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Labor Welfare Promotion Fund | 3.665-3.975 | 2023 | 2024 | 50 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from Korea Technology Finance Corporation | 3.135-3.585 | 2022 | 2024 | 195 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Credit Guarantee Fund for Agriculture, Forestry and Fisheries Suppliers |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Government Employees' Pension Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Film Industry Development Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Korea Credit Guarantee Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Housing Finance Credit Guarantee Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings from the Korea Infrastructure Credit Guarantee Fund |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Borrowings |  |  |  | 1205 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total Internal Funded Debt** |  |  |  | 1080844.4 |

---

(1) Interest Rates and Years of Original Maturity not applicable.

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&nbsp;&nbsp;&nbsp;&nbsp;***D. Internal Guaranteed Debt of the Government***

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Title** | **Range of<br>Interest Rates** | **Range of<br>Years of Issue** | **Range of Years<br>of Original<br>Maturity** | **Principal<br>Amounts<br>Outstanding as<br>of December 31,<br>2023** |
|  | **(%)** | | | **(billions of Won)** |
| **1. Bonds of Government-Affiliated Corporations** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Deposit Insurance Corporation |  |  |  | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Korea Student Aid Foundation | 1.07-5.48 | 2011-2023 | 2024-2043 | 9980 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Key Industry Stabilization Fund | 1.08-2.19 | 2020-2021 | 2024-2025 | 480 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **Total Internal Guaranteed Debt** |  |  |  | 10460 |

---

&nbsp;&nbsp;&nbsp;&nbsp;***E. Others***

*Commitments to Assume Treasury Obligations* 

The Government may, if deemed necessary for recovery from disasters and calamities, make commitments to assume treasury obligations to the extent resolved by the National Assembly each fiscal year. In such cases, such commitments shall be executed in accordance with the procedures for spending reserve funds within general accounts.

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**DESCRIPTION OF THE SECURITIES** 

**Description of Debt Securities** 

We will issue debt securities under a fiscal agency agreement or agreements. The description below summarizes the material provisions of the debt securities and the fiscal agency agreement. Since it is only a summary, the description may not contain all of the information that may be important to you as a potential investor in the debt securities. Therefore, we urge you to read the form of fiscal agency agreement and the form of global debt security before deciding whether to invest in the debt securities. We have filed a copy of these documents with the Securities and Exchange Commission as exhibits to the registration statement of which this prospectus is a part. You should refer to such exhibits for more complete information.

The financial terms and other specific terms of your debt securities will be described in the prospectus supplement relating to your debt securities. The description in the prospectus supplement will supplement this description or, to the extent inconsistent with this description, replace it.

We will appoint a fiscal agent or agents in connection with debt securities whose duties will be governed by the fiscal agency agreement. We may replace the fiscal agent or appoint different fiscal agents for different series of debt securities.

***General Terms of the Debt Securities***

We may issue debt securities in separate series at various times. The Republic may irrevocably guarantee the payment of principal of, and interest on, one or more series of debt securities. The prospectus supplement that relates to your debt securities will specify some or all of the following terms:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the aggregate principal amount;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the currency of denomination and payment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any limitation on principal amount and authorized denominations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the percentage of their principal amount at which the debt securities will be issued;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the maturity date or dates;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the interest rate for the debt securities and, if variable, the method by which the interest rate will be
calculated;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether any amount payable in respect of the debt securities will be determined based on an index or formula, and
how any such amount will be determined;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the dates from which interest, if any, will accrue for payment of interest and the record dates for any such
interest payments;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• where and how we will pay principal and interest;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether and in what circumstances the debt securities may be redeemed before maturity;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any sinking fund or similar provision;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether any part or all of the debt securities will be in the form of a global security and the circumstances in
which a global security is exchangeable for certificated securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• if issued in certificated form, whether the debt securities will be in bearer form with interest coupons, if any,
or in registered form without interest coupons, or both forms, and any restrictions on exchanges from one form to the other;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether any of the terms set out herein will differ for the debt securities;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the Republic will irrevocably guarantee the payment of principal of, and interest on, the debt
securities; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other specific provisions.

Depending on the terms of the debt securities we issue, the prospectus supplement relating to the debt securities may also describe applicable U.S. federal income tax and other considerations additional to the disclosure in this prospectus.

Unless otherwise specified in the applicable prospectus supplement, we will maintain at an office in the Borough of Manhattan, The City of New York, a register for the registration of transfers of debt securities issued in registered form.

***Payments of Principal, Premium and Interest***

On every payment date specified in the relevant prospectus supplement, we will pay the principal, premium and/or interest due on that date to the registered holder of the relevant debt security at the close of business on the related record date. We will make all payments at the place and in the currency set out in the prospectus supplement. Unless otherwise specified in the relevant prospectus supplement or the debt securities, we will make payments in U.S. dollars at the New York office of the fiscal agent or, outside the United States, at the office of any paying agent. Unless otherwise specified in the applicable prospectus supplement or debt securities, we will pay interest by check, payable to the registered holder.

We will make any payments on debt securities in bearer form at the offices and agencies of the fiscal agent or any other paying agent outside the United States as we may designate. At the option of the holder of the bearer debt securities, we will make such payments by check or by transfer to an account maintained by the holder with a bank located outside of the United States. We will not make payments on bearer debt securities at the corporate trust office of the fiscal agent in the United States or at any other paying agency in the United States. In addition, we will not make any payment by mail to an address in the United States or by transfer to an account maintained by a holder of bearer debt securities with a bank in the United States. Nevertheless, we will make payments on a bearer debt security denominated and payable in U.S. dollars at an office or agency in the United States if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• payment outside the United States is illegal or effectively precluded by exchange controls or other similar
restrictions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the payment is then permitted under United States law, without material adverse consequences to us.

If we issue bearer debt securities, we will designate the offices of at least one paying agent outside the United States as the location for payment.

***Repayment of Funds; Prescription***

If no one claims money paid by us to the fiscal agent for the payment of principal or interest in respect of any series of debt securities for two years after the payment was due and payable, the fiscal agent or paying agent will repay the money to us. After such repayment, the fiscal agent or paying agent will not be liable with respect to the amounts so repaid, and you may look only to us for any payment under the debt securities.

Under Korean law, you will not be permitted to file a claim against us for payment of principal or interest on any series of debt securities unless you do so within five years, in the case of principal, and two years, in the case of interest, from the date on which payment was due.

***Global Securities***

The prospectus supplement relating to a series of debt securities will indicate whether any of that series of debt securities will be represented by a global security. The prospectus supplement will also describe any unique

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specific terms of the depositary arrangement with respect to that series. Unless otherwise specified in the prospectus supplement, we anticipate that the following provisions will apply to depositary arrangements.

*Registered Ownership of the Global Security* 

The global security will be registered in the name of a depositary identified in the prospectus supplement, or its nominee, and will be deposited with the depositary, its nominee or a custodian. The depositary, or its nominee, will therefore be considered the sole owner or holder of debt securities represented by the global security for all purposes under the fiscal agency agreement. Except as specified below or in the applicable prospectus supplement, beneficial owners:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• will not be entitled to have any of the debt securities represented by the global security registered in their
names;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• will not receive physical delivery of any debt securities in definitive form;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• will not be considered the owners or holders of the debt securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• must rely on the procedures of the depositary and, if applicable, any participants (institutions that have
accounts with the depositary or a nominee of the depositary, such as securities brokers and dealers) to exercise any rights of a holder; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• will receive payments of principal and interest from the depositary or its participants rather than directly from
us.

We understand that, under existing industry practice, the depositary and participants will allow beneficial owners to take all actions required of, and exercise all rights granted to, the registered holders of the debt securities.

We will register debt securities in the name of a person other than the depositary or its nominee only if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the depositary for a series of debt securities is unwilling or unable to continue as depositary; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we determine, in our sole discretion, not to have a series of debt securities represented by a global security.

In either such instance, an owner of a beneficial interest in a global security will be entitled to registration of a principal amount of debt securities equal to its beneficial interest in its name and to physical delivery of the debt securities in definitive form.

*Beneficial Interests in and Payments on a Global Security* 

Only participants, and persons that may hold beneficial interests through participants, can own a beneficial interest in the global security. The depositary keeps records of the ownership and transfer of beneficial interests in the global security by its participants. In turn, participants keep records of the ownership and transfer of beneficial interests in the global security by other persons (such as their customers). No other records of the ownership and transfer of beneficial interests in the global security will be kept.

All payments on a global security will be made to the depositary or its nominee. When the depositary receives payment of principal or interest on the global security, we expect the depositary to credit its participants' accounts with amounts that correspond to their respective beneficial interests in the global security. We also expect that, after the participants' accounts are credited, the participants will credit the accounts of the owners of beneficial interests in the global security with amounts that correspond to the owners' respective beneficial interests in the global security.

The depositary and its participants establish policies and procedures governing payments, transfers, exchanges and other important matters that affect owners of beneficial interests in a global security. The

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depositary and its participants may change these policies and procedures from time to time. We have no responsibility or liability for the records of ownership of beneficial interests in the global security, or for payments made or not made to owners of such beneficial interests. We also have no responsibility or liability for any aspect of the relationship between the depositary and its participants or for any aspect of the relationship between participants and owners of beneficial interests in the global security.

*Bearer Securities* 

We may issue debt securities in a series in the form of one or more bearer global debt securities deposited with a common depositary for the Euroclear and Clearstream, or with a nominee identified in the applicable prospectus supplement. The specific terms and procedures, including the specific terms of the depositary arrangement, with respect to any portion of a series of debt securities to be represented by a global security will be described in the applicable prospectus supplement.

***Additional Amounts***

We will make all payments of principal of, and premium and interest, if any, on the debt securities without withholding or deducting any present or future taxes imposed by the Republic or any of its political subdivisions, unless required by law. If Korean law requires us to deduct or withhold taxes, we will pay additional amounts as necessary to ensure that you receive the same amount as you would have received without such withholding or deduction.

We will not pay, however, any additional amounts if you are liable for Korean tax because:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• you are connected with the Republic other than by merely owning the debt security or receiving income or payments
on the debt security;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• you failed to complete and submit a declaration of your status as a non-resident of the Republic after we or the relevant tax authority requested you to do so; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• you failed to present your debt security for payment within 30 days of when the payment is due or, if the fiscal
agent did not receive the money prior to the due date, the date notice is given to holders that the fiscal agent has received the full amount due to holders. Nevertheless, we will pay additional amounts to the extent you would have been entitled to
such amounts had you presented your debt security for payment on the last day of the 30-day period.

We will not pay any additional amounts for taxes on the debt securities except for taxes payable through deduction or withholding from payments of principal, premium or interest. Examples of the types of taxes for which we will not pay additional amounts include the following: estate or inheritance taxes, gift taxes, sales or transfer taxes, personal property or related taxes, assessments or other governmental charges. We will also not pay any additional amounts for taxes imposed pursuant to Sections 1471 through 1474 of the U.S. Internal Revenue Code of 1986, as amended, U.S. Treasury regulations or administrative guidance promulgated thereunder or any law implementing an intergovernmental approach thereto, or FATCA. We will pay stamp or other similar taxes that may be imposed by the Republic, the United States or any political subdivision or taxing authority in one of those two countries on the fiscal agency agreement or be payable in connection with the issuance of the debt securities.

***Status of Debt Securities***

The debt securities will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• constitute our direct, unconditional, unsecured and unsubordinated obligations; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• rank without any preference among themselves and equally with all of our other unsecured and unsubordinated
obligations. It is understood that this provision shall not be construed so as to require us to make payments under the debt securities ratably with payments being made under any of our other debt securities.

***Negative Pledge Covenant***

If any debt securities are outstanding, we will not create or permit any security interests on our assets as security for any of our indebtedness or guarantees issued by us, unless the security interest also secures our obligations under the debt securities.

We may, however, create or permit a security interest:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• on any promissory debt securities or commercial paper discounted or otherwise provided as security to or issued
or held by us created in favor of The Bank of Korea in the normal operation of The Bank of Korea's discount facilities or facilities for the funding of loans by us to our customers; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• on any asset (or documents of title to such asset) incurred when the asset was purchased or improved to secure
payment of the cost of the activity; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• of a statutory nature arising in the ordinary course of our business but unrelated to our activities of borrowing
or raising money; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• on any real estate owned by us imposed by a tenant of such real estate as security for repayment of any key money
paid by the tenant; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• arising by operation of Korean law or given preference by law following our failure to meet an obligation,
although we will not permit such a security interest to exist for more than 30 days.

***Events of Default***

Unless otherwise specified in the applicable prospectus supplement in connection with a particular offering of debt securities, each of the following constitutes an event of default with respect to any series of debt securities:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. *Non-Payment*: we do not pay principal or interest or premium or
deposit any sinking fund payment on any debt securities of the series when due and such failure to pay continues for 30 days.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. *Breach of Other Obligations*: we fail to observe or perform any of the covenants in the series of debt
securities (other than non-payment) for 60 days after written notice of the default is delivered to us at the corporate trust office of the fiscal agent in New York City by holders representing at least 10% of
the aggregate principal amount of the debt securities of the series.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. *Cross Default and Cross Acceleration*:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we default on any External Indebtedness, and, as a result, becomes obligated to pay an amount equal to or greater
than US$10,000,000 in aggregate principal amount prior to its due date; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we fail to pay when due, including any grace period, any of our External Indebtedness in aggregate principal
amount equal to or greater than US$10,000,000 or we fail to pay when requested and required by the terms thereof any guarantee for External Indebtedness of another person equal to or greater than US$10,000,000 in aggregate principal amount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. *Moratorium/Default:* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Republic declares a general moratorium on the payment of its External Indebtedness, including obligations
under guarantees;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Republic becomes liable to repay prior to maturity any amount of External Indebtedness, including obligations
under guarantees, as a result of a default under such External Indebtedness or obligations; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the international monetary reserves of the Republic become subject to a security interest or segregation or other
preferential arrangement for the benefit of any creditors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. *Bankruptcy*:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we are declared bankrupt or insolvent by any court or administrative agency with jurisdiction over us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we pass a resolution to apply for bankruptcy or to request the appointment of a receiver or trustee or similar
official in insolvency;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a substantial part of our assets are liquidated; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we cease to conduct the banking business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. *Cessation of Government Control or Failure of Support:* the Republic ceases to (directly or indirectly)
control us or fails to provide financial support for us as required under Article 32 of the KDB Act as of the issue date of the debt securities of such series.

For purposes of the foregoing, "External Indebtedness" means any obligation for the payment or repayment of money borrowed that is denominated in a currency other than the currency of the Republic.

As used in paragraph 6 above, "control" means the acquisition or control of a majority of our voting share capital or the right to appoint and/or remove all or the majority of the members of our board of directors or other governing body, whether obtained directly or indirectly, and whether obtained by ownership of share capital, the possession of voting rights, contract or otherwise.

If an event of default occurs, any holder may declare the principal amount of debt securities that it holds to be immediately due and payable by written notice to us and the fiscal agent.

*You should note that:* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• despite the procedure described above, no debt securities may be declared due and payable if we cure the
applicable event of default before we receive the written notice from the debt security holder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *we are not required to provide periodic evidence of the absence of defaults; and* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the fiscal agency agreement does not require us to notify holders of the debt securities of an event of default
or grant any debt security holder a right to examine the security register.

***Modifications and Amendments; Debt Securityholders' Meetings***

Each holder of a series of debt securities must consent to any amendment or modification of the terms of that series of debt securities or the fiscal agency agreement that would, among other things:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• change the stated maturity of the principal of the debt securities or any installment of interest;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• reduce the principal amount of such series of debt securities or the portion of the principal amount payable upon
acceleration of such debt securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• change the debt security's interest rate or premium payable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• change the currency of payment of principal, interest or premium;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• amend either the procedures provided for a redemption event or the definition of a redemption event;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• shorten the period during which we are not allowed to redeem the debt securities or grant us a right to redeem
the debt securities which we previously did not have; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• reduce the percentage of the outstanding principal amount needed to modify or amend the fiscal agency agreement
or the terms of such series of debt securities.

We may, with the exception of the above changes, with the consent of the holders of at least 66 <sup>2</sup>/<sub>3</sub>% in principal amount of the debt securities of a series that are outstanding, modify and amend other terms of that series of debt securities.

We may at any time call a meeting of the holders of a series of debt securities to seek the holders of the debt securities' approval of the modification, or amendment, or obtain a waiver, of any provision of that series of debt securities. The meeting will be held at the time and place in the Borough of Manhattan in New York City as determined by the fiscal agent. The notice calling the meeting must be given at least 30 days and not more than 60 days prior to the meeting.

While an event of default with respect to a series of debt securities is continuing, holders of at least 10% of the aggregate principal amount of that series of debt securities may compel the fiscal agent to call a meeting of all holders of debt securities of that series.

Holders of debt securities who hold, in the aggregate, a majority in principal amount of the debt securities of the series that are outstanding at the time will constitute a quorum at a meeting. At the reconvening of any meeting adjourned for a lack of a quorum, the persons entitled to vote 25% in principal amount of the debt securities of the series that are outstanding at the time will constitute a quorum for taking any action set out in the original notice. To vote at a meeting, a person must either hold outstanding debt securities of the relevant series or be duly appointed as a proxy for a debt securityholder. The fiscal agent will make all rules governing the conduct of any meeting.

The fiscal agency agreement and a series of debt securities may be modified or amended, without the consent of the holders of the debt securities, to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• add covenants made by us that benefit holders of the debt securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• surrender any right or power given to us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• secure the debt securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• permit registered securities to be exchanged for bearer securities or relax or eliminate restrictions on the
payment of principal, premium or interest on bearer securities to the extent permitted under United States Department of Treasury regulations, provided that holders of the debt securities do not suffer any adverse tax consequences as a result; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• cure any ambiguity or correct or supplement any defective provision in the fiscal agency agreement or the debt
securities, without materially and adversely affecting the interests of the holders of the debt securities.

***Fiscal Agent***

The fiscal agency agreement governs the duties of each fiscal agent. We may maintain bank accounts and a banking relationship with each fiscal agent. The fiscal agent is our agent and does not act as a trustee for the holders of the debt securities.

***Further Issues of Debt Securities***

We may, without the consent of the holders of the debt securities, create and issue additional debt securities with the same terms and conditions as any series of debt securities (or that are the same except for the amount of

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the first interest payment and for the interest paid on the series of debt securities prior to the issuance of the additional debt securities). We may consolidate such additional debt securities with the outstanding debt securities to form a single series.

**Description of Warrants** 

The description below summarizes some of the provisions of warrants for the purchase of debt securities that we may issue from time to time and of the warrant agreement. Copies of the forms of warrants and the warrant agreement are or will be filed as exhibits to the registration statement of which this prospectus is a part. Since it is only a summary, the description may not contain all of the information that is important to you as a potential investor in the warrants.

The description of the warrants that will be contained in the prospectus supplement will supplement this description and, to the extent inconsistent with this description, replace it.

***General Terms of the Warrants***

Each series of warrants will be issued under a warrant agreement to be entered into between us and a bank or trust company, as warrant agent. The prospectus supplement relating to the series of warrants will describe:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the terms of the debt securities purchasable upon exercise of the warrants, as described above under
"—Description of Debt Securities—General Terms of the Debt Securities";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the principal amount of debt securities purchasable upon exercise of one warrant and the exercise price;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the procedures and conditions for the exercise of the warrants;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the dates on which the right to exercise the warrants begins and expires;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether and under what conditions the warrants may be terminated or canceled by us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether and under what conditions the warrants and any debt securities issued with the warrants will be
separately transferable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the warrants will be issued in bearer or registered form;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the warrants will be exchangeable between registered and bearer form, and, if issued in registered form,
where they may be transferred and registered; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other specific provisions.

**Terms Applicable to Debt Securities and Warrants** 

***Governing Law***

The fiscal agency agreement, any warrant agreement and the debt securities and any warrants will be governed by the laws of the State of New York without regard to any principles of New York law requiring the application of the laws of another jurisdiction. Nevertheless, all matters governing our authorization, execution and delivery of the debt securities and the fiscal agency agreement and any warrants and warrant agreement by us will be governed by the laws of the Republic.

***Jurisdiction and Consent to Service***

We are owned by a foreign sovereign government and all of our directors and executive officers and some of the experts named in this prospectus are residents of Korea. In addition, all or most of our assets and the assets of the people named in the preceding sentence are located outside of the United States. For that reason, you may have difficultly serving process on us or the individuals described above in the United States or enforcing in a

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U.S. court a U.S.-court judgment based on the U.S. federal securities laws. Our Korean counsel has informed us that there would be certain conditions to be met under Korean law regarding the enforceability in Korea, either in original actions or in actions for the enforcement of U.S.-court judgments, of civil liabilities based on the U.S. federal securities laws. The enforcement of U.S.-court judgments against KDB may be affected or limited by the general principle of good morals and other social order and the general principle of good faith and fairness provided in the Civil Code of Korea. The courts of Korea will recognize as a valid judgment and enforce any judgment obtained in a U.S. court without re-examination of the merits; provided, that (a) such judgment was finally and conclusively given by a court having valid jurisdiction in accordance with the international jurisdiction principles under Korean law and applicable treaties, (b) KDB was duly served with service of process (otherwise than by publication or similar means) in sufficient time to enable KDB to prepare our defense in conformity with applicable laws or responded to the action without being served with process, (c) in light of the substance of such judgment and the procedures of litigation, recognition of such judgment is not contrary to the public policy of Korea, and (d) judgments of the courts of Korea are accorded reciprocal treatment in the jurisdiction of the court which had issued such judgment or the requirements for the recognition of a foreign judgment in the jurisdiction of the court which had issued such judgment are neither manifestly inequitable nor substantially different in material respects from the requirements for recognition of a foreign judgment in Korea.

We have appointed the General Manager of our New York Branch, Mr. Tae Jeong Yun, and the Deputy General Manager of our New York Branch, Mr. Jinwon Kim, and each of their successors in the future, as our authorized agents to receive service of process in any suit which a holder of any series of debt securities or warrants may bring in any state or federal court in New York City and we have accepted the jurisdiction of those courts for those actions. Our New York Branch is located at 320 Park Avenue, 32nd Floor, New York, New York 10022. These appointments are irrevocable as long as any amounts of principal, premium or interest remain payable by us to the Fiscal Agent under any series of debt securities or any warrants have not expired or otherwise terminated under their terms. If for any reason either of these two men ceases to act as our authorized agent or ceases to have an address in Manhattan, we shall appoint a replacement. The appointment of agents for receipt of service of process and the acceptance of jurisdiction of state or federal courts in New York City do not, however, apply to actions brought under the United States federal securities laws. We may also be sued in courts having jurisdiction over us located in the Republic.

We will irrevocably consent to any relief and process in connection with a suit against us in relation to the debt securities or warrants, including the enforcement or execution of any order or judgment of the court. To the extent permitted by law, we will waive irrevocably any immunity from jurisdiction to which we might otherwise be entitled in any suit based on any series of debt securities or warrants.

***Foreign Exchange Controls***

Before we may issue debt securities outside the Republic, the Minister of Economy and Finance of Korea must receive a report with respect to the issuance by us of debt securities in accordance with the Foreign Exchange Transaction Act and the Foreign Exchange Transaction Regulation of Korea. After issuance of debt securities outside the Republic, we are required to notify the Minister of Economy and Finance of such issuance. No further approval or authorization is required for us to pay principal of or interest on the debt securities.

**Description of Guarantees to be Issued by Us** 

The description below summarizes some of the provisions of the guarantees that we may issue from time to time. Copies of the forms of guarantees are or will be filed as exhibits to the registration statement of which this prospectus is a part. Since it is only a summary, the description may not contain all of the information that is important to you as a potential beneficiary of a guarantee.

The description of a guarantee that will be contained in the prospectus supplement will supplement this description and, to the extent inconsistent with this description, replace it.

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***General Terms of the Guarantees***

Each guarantee will be issued by us as guarantor. The prospectus supplement relating to a guarantee will specify:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the relevant obligor and the obligations guaranteed under the guarantee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the nature and scope of the guarantee, including whether or not it is irrevocable and unconditional;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the status of the guarantee in relation to our other obligations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the governing law of the guarantee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other relevant provisions of the guarantee.

**Description of Guarantees to be Issued by The Republic of Korea** 

The description below summarizes some of the provisions of the guarantees that the Republic may issue from time to time to guarantee our debt securities. Since it is only a summary, the description may not contain all of the information that is important to you as a potential beneficiary of a guarantee.

The prospectus supplement relating to a guarantee to be issued by the Republic will specify other specific provisions. The description of a guarantee to be issued by the Republic that will be contained in the prospectus supplement will supplement this description and, to the extent inconsistent with this description, replace it.

***General Terms of the Guarantees***

Each guarantee will be issued by the Republic as guarantor. The prospectus supplement relating to a guarantee will specify:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the relevant obligor and the obligations guaranteed under the guarantee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the nature and scope of the guarantee, including whether or not it is irrevocable and unconditional;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the status of the guarantee in relation to the Republic's other obligations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the governing law of the guarantee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other relevant provisions of the guarantee.

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**LIMITATIONS ON ISSUANCE OF BEARER DEBT SECURITIES AND BEARER WARRANTS** 

Bearer securities will not be offered, sold or delivered in the United States or its possessions or to a United States person; except in certain circumstances permitted by United States tax regulations. Bearer securities will initially be represented by temporary global securities, without interest coupons, deposited with a common depositary in London for Euroclear and Clearstream for credit to designated accounts. Unless otherwise indicated in the prospectus supplement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• each temporary global security will be exchangeable for definitive bearer securities on or after the date that is
40 days after issuance only upon receipt of certification of non-United States beneficial ownership of the temporary global security as provided for in United States tax regulations, provided that no bearer
security will be mailed or otherwise delivered to any location in the United States in connection with the exchange; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any interest payable on any portion of a temporary global security with respect to any interest payment date
occurring prior to the issuance of definitive bearer securities will be paid only upon receipt of certification of non-United States beneficial ownership of the temporary global security as provided for in
United States tax regulations.

Bearer securities, other than temporary global debt securities, and any related coupons will bear the following legend: "Any United States person who holds this obligation will be subject to limitations under the United States federal income tax laws, including the limitations provided in Section 165(j) and 1287(a) of the Internal Revenue Code." The sections referred to in the legend provide that, with certain exceptions, a United States person who holds a bearer security or coupon will not be allowed to deduct any loss realized on the disposition of the bearer security, and any gain, which might otherwise be characterized as capital gain, recognized on the disposition will be treated as ordinary income.

For purposes of this section, "United States person" means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a citizen or resident of the United States;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a corporation, partnership or other entity created or organized in or under the laws of the United States or any
political subdivision thereof; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an estate or trust the income of which is subject to United States federal income taxation regardless of its
source.

For purposes of this section, "United States" means the United States of America, including each state and the District of Columbia, its territories, possessions and other areas subject to its jurisdiction.

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**TAXATION** 

The following discussion summarizes certain Korean tax and U.S. federal income tax considerations that may be relevant to you if you invest in debt securities. This summary is based on laws, regulations, rulings and decisions in effect as of the date of this Prospectus. These laws, regulations, rulings and/or decisions may change; any such change could apply retroactively and could affect the continued validity of this summary.

This summary does not describe all of the tax considerations that may be relevant to you or your situation, particularly if you are subject to special tax rules. You should consult your tax adviser about the tax consequences of holding the debt securities, including the relevance to your particular situation of the considerations discussed below, as well as of state, local or other tax laws.

**Korean Taxation** 

The following summary of Korean tax considerations applies to you so long as you are not:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a resident of Korea;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a corporation with registered head office or main office located in Korea;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a corporation of which the place of effective management is located in Korea; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• engaged in a trade or business in Korea through a permanent establishment or a fixed base to which the relevant
income is attributable or with which the relevant income is effectively connected.

***Tax on Interest Payments***

Under current Korean tax laws, when we make payments of interest to you (excluding payments to your permanent establishment in Korea) on the debt securities denominated in a foreign currency, no amount will be withheld from such payments for, or on account of, taxes of any kind imposed, levied, withheld or assessed by Korea or any political subdivision or taxing authority thereof or therein, provided that the offering of the debt securities is deemed to be an overseas issuance under Korean tax law.

If the tax exemption under Korean tax law referred to above were to cease to be in effect, the payments of interest to you (excluding payments to your permanent establishment in Korea) on the debt securities will be taxable at Korean withholding tax rates of 15.4% (including local income tax) unless a reduced rate is available under an applicable income tax treaty. For more information regarding tax treaties, please refer to the heading "—Tax Treaties" below.

***Tax on Capital Gains***

You will not be subject to any Korean income or withholding taxes in connection with the sale, exchange or other disposition of the debt securities, if (i) such sale, exchange or disposition is made to other non-residents or non-Korean corporations (other than their permanent establishments in Korea) or (ii) such sale, exchange or disposition takes place outside Korea, provided that the issuance of the debt securities is deemed to be an overseas issuance under Korean tax law. If you sell, exchange or otherwise dispose of the debt securities to a Korean resident or a Korean corporation (or the Korean permanent establishment of a non-resident or a non-Korean corporation) and such sale, exchange or disposition is made within Korea, any gain realized on the transaction will be taxable at ordinary Korean withholding tax rates (the lower of (subject to the production of satisfactory evidence of the acquisition costs and certain direct transaction costs) 22% (including local income tax) of net gain or 11% (including local income tax) of the gross sale proceeds with respect to such transaction), unless an exemption is available under an applicable income tax treaty. For example, if you are a resident of the United States for the purposes of the income tax treaty currently in force between Korea and the United States, you are generally entitled to an exemption from Korean taxation in respect of any gain realized on a disposition of the debt securities, regardless of whether the disposition is to a Korean resident. For more information regarding tax treaties, please refer to the heading "—Tax Treaties" below.

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***Inheritance Tax and Gift Tax***

If you die while you are the holder of the debt security, the subsequent transfer of the debt security by way of succession will be subject to Korean inheritance tax. Similarly, if you transfer the debt security as a gift, the donee will be subject to Korean gift tax and you may be required to pay the gift tax if the donee fails to do so or the donee is a non-resident.

***Stamp Duty***

You will not be subject to any Korean securities transaction tax, stamp duty, registration tax or similar documentary tax in respect of or in connection with a transfer of any debt securities or in connection with the exercise of exchange rights or conversion rights that may be acquired with the debt securities except for a nominal amount of stamp duty on certain documents executed in Korea which will be paid by us.

***Guarantees***

Although there are no Korean tax laws, regulations, rulings or decisions specific to the payment under the guarantee herein, with regard to payment of any interest on the debt securities under the guarantee herein, the Korean tax authority issued a ruling in April 2019 to the effect that the interest on the foreign currency denominated bonds paid by the guarantor on behalf of the issuer due to the insolvency of the issuer is exempt from income tax and corporation tax provided that the offering of the debt securities is deemed to be an overseas issuance under Korean tax law. In this regard, even though it is not clear under Korean tax laws, regulations or decisions, we believe any payments of interest on and principal amount of the debt securities (or the issue price if the debt securities were originally issued at a discount) by the Republic under the Republic's guarantee on the debt securities denominated in a foreign currency (provided that the offering of the debt securities is deemed to be an overseas issuance under Korean tax law) and issued by us or any payments of interest on and principal amount of the debt securities (or the issue price if the debt securities were originally issued at a discount) by us under our guarantee on the debt securities denominated in a foreign currency (provided that the offering of the debt securities is deemed to be an overseas issuance under Korean tax law) and issued by a third-party Korean issuer are not subject to withholding tax. Further details of the tax consequences of the holders of our debt securities guaranteed by the Republic or third-party debt securities guaranteed by us may be provided in the relevant prospectus supplement.

***Tax Treaties***

At the date of this prospectus, Korea has tax treaties with, among others, Australia, Austria, Bangladesh, Belgium, Brazil, Bulgaria, Canada, China, Czech Republic, Denmark, Egypt, Finland, France, Germany, Hungary, India, Indonesia, Ireland, Italy, Japan, Luxembourg, Malaysia, Mexico, Mongolia, the Netherlands, New Zealand, Norway, Pakistan, Philippines, Poland, Republic of Fiji, Romania, Singapore, Spain, Sri Lanka, Sweden, Switzerland, Thailand, Tunisia, Turkey, the United Kingdom, the United States of America and Vietnam under which the rate of withholding tax on interest and dividends is reduced, generally to between 5% and 16.5% (including local income tax), and the tax on capital gains is often eliminated.

With respect to any gains subject to Korean withholding tax, as described under "—Tax on Capital Gains" above, you should inquire for yourself whether you are entitled to the benefit of a tax treaty with Korea. It will be your responsibility to claim the benefits of any tax treaty that may exist between your country and Korea in respect of capital gains, and to provide to the purchaser of the debt securities, or the relevant securities company handling the debt securities, as applicable, a certificate as to your country of tax residence. In the absence of sufficient proof, the purchaser, or the relevant securities company, as the case may be, must withhold tax at the normal rates.

Furthermore, in order to claim the benefit of a tax rate reduction or tax exemption available under the applicable tax treaties, you should submit to the payer of such Korean source income an application (for reduced

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withholding tax rate, "application for entitlement to reduced tax rate" and in the case of exemption from withholding tax, "application for exemption" under a tax treaty along with the documents proving the beneficial owner of such Korean source income, including a certificate of the non-resident holder's tax residence issued by a competent authority of the non-resident holder's residence country) as the beneficial owner, or a BO Application. If you are a non-resident corporation and the amount of tax reduction or exemption is W1 billion or more (excluding cases where the domestic source income is paid through a foreign investment scheme or where the real beneficiary of domestic source income is a governmental organization of the other country to a tax treaty prescribed by the Ministry of Economy and Finance, including the government of the signatory state to the relevant tax treaty, local government, or the central bank), you must additionally submit (i) the names and addresses of the members of your board of directors, (ii) personal details and current equity holdings of your shareholders, (iii) your audit reports for the past three years, or (iv) tax returns or financial statements (including detailed statements) submitted to a relevant tax authority of the non-resident's country of residence for the past three years, together with Korean translations thereof. Such application should be submitted to the withholding agent prior to the payment date of the relevant income. Subject to certain exceptions, where the relevant income is paid to an overseas investment vehicle (which is not the beneficial owner of such income), or an OIV, a beneficial owner claiming the benefit of an applicable tax treaty with respect to such income must submit its BO Application to such OIV, which must submit an OIV report and a schedule of beneficial owners to the withholding agent prior to the payment date of such income. Starting from January 1, 2022, an OIV is deemed to be a beneficial owner of the Korean source income if (i) under the applicable tax treaty, the OIV bears tax liabilities in the country in which it is established or the OIV is deemed to be the beneficial owner of the Korean source income, and (ii) the Korean source income is eligible for the treaty benefits under the tax treaty. The benefits under a tax treaty between Korea and the country of such OIV's residence will apply with respect to the relevant income paid to such OIV, subject to certain application requirements as prescribed by Korean tax law. In the case of a tax exemption application, the withholding agent is required to submit such application (together with the applicable OIV report in the case of income paid to an OIV) to the relevant district tax office by the ninth day of the month following the date of the payment of such income.

At present, Korea has not entered into tax treaties regarding inheritance or gift tax.

***Warrants***

A description of the tax consequences of an investment in warrants will be provided in the applicable prospectus supplement.

**U.S. Federal Income Tax Considerations** 

The following discussion summarizes certain U.S. federal income tax considerations that may be relevant to you if you invest in debt securities and are a U.S. holder. You will be a U.S. holder if you are a beneficial owner of the debt securities and are an individual who is a citizen or resident of the United States, a U.S. domestic corporation, or any other person that is subject to U.S. federal income tax on a net income basis in respect of its investment in a debt security. This summary deals only with U.S. holders that hold debt securities as capital assets for tax purposes. This summary does not apply to you if you are an investor that is subject to special tax rules, such as:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a bank or thrift;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a real estate investment trust;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a regulated investment company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an insurance company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a dealer in securities or currencies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a trader in securities or commodities that elects mark-to-market treatment;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a person that will hold debt securities as a hedge against currency risk or as a position in a straddle or
conversion transaction for tax purposes, or as part of a "synthetic security" or other integrated financial transaction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• nonresident alien individuals present in the United States for more than 182 days in a taxable year;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• U.S. expatriates;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an entity taxed as a partnership or a partner therein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a tax exempt organization; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a United States person whose functional currency for tax purposes is not the U.S. dollar.

This summary is based on the Internal Revenue Code of 1986, as amended, or the Code, its legislative history, existing and proposed regulations promulgated thereunder, and published rulings and court decisions, all as currently in effect. These laws are subject to change, possibly on a retroactive basis. This summary addresses only U.S. federal income tax consequences, and does not address state, local, or non-U.S. tax laws, any alternative minimum tax, or the Medicare tax on net investment income or under special timing rules prescribed under section 451(b) of the Code. This summary does not discuss tax considerations relevant to the ownership and disposal of bearer securities.

This summary deals only with debt securities that are properly treated as indebtedness for U.S. federal income tax purposes. Any special U.S. federal income tax considerations relevant to a particular issuance of debt securities will be discussed in the applicable prospectus supplement. Additionally, this summary does not address the U.S. federal income tax considerations with respect to an investment in warrants or guarantees. A description of the tax consequences of an investment in a warrant or a guarantee will be provided in the applicable prospectus supplement.

You should consult your tax adviser about the tax consequences of holding debt securities, including the relevance to your particular situation of the considerations discussed below, as well as of state, local or other tax laws.

***Payments or Accruals of Interest and Additional Amounts***

Payments or accruals of "qualified stated interest" (as defined below) on a debt security, and additional amounts, if any (*i.e.,* without reduction for Korean withholding taxes, determined utilizing the appropriate Korean withholding tax rate applicable to you), but excluding any pre-issuance accrued interest, will be taxable to you as ordinary interest income at the time that you receive or accrue such amounts, in accordance with your regular method of tax accounting. If you use the cash method of tax accounting and you receive payments of interest pursuant to the terms of a debt security in a currency other than U.S. dollars, a "foreign currency", the amount of interest income you will realize will be the U.S. dollar value of the foreign currency payment based on the exchange rate in effect on the date you receive the payment regardless of whether you convert the payment into U.S. dollars. If you are an accrual-basis U.S. holder, the amount of interest income you will realize will be based on the average exchange rate in effect during the interest accrual period or, with respect to an interest accrual period that spans two taxable years, at the average exchange rate for the partial period within the taxable year. Alternatively, as an accrual-basis U.S. holder you may elect to translate all interest income on foreign currency-denominated debt securities at the spot rate on the last day of the accrual period (or the last day of the taxable year, in the case of an accrual period that spans more than one taxable year), or on the date that you receive the interest payment if that date is within five business days of the end of the accrual period. If you make this election you must apply it consistently to all debt instruments from year to year and you cannot change the election without the consent of the U.S. Internal Revenue Service, or the IRS. If you use the accrual method of accounting for tax purposes you will recognize foreign currency gain or loss on the receipt of a foreign currency interest payment if the exchange rate in effect on the date the payment is received differs from the rate applicable

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to a previous accrual of that interest income. Amounts attributable to pre-issuance accrued interest will generally not be includable in income, except to the extent of foreign currency gain or loss attributable to any changes in exchange rates during the period between the date the U.S. Holder acquired the debt security and the first interest payment date. This foreign currency gain or loss will be treated as ordinary income or loss, but generally will not be treated as an adjustment to interest income received on the debt security.

Subject to generally applicable limitations and conditions, Korean interest withholding tax paid at the appropriate rate applicable to the U.S. holder may be eligible for credit against such U.S. holder's U.S. federal income tax liability. These generally applicable limitations and conditions include requirements adopted by the IRS in regulations promulgated in December 2021, and any Korean tax will need to satisfy these requirements in order to be eligible to be a creditable tax for a U.S. holder. In the case of a U.S. holder that consistently elects to apply a modified version of these rules under recently issued temporary guidance and complies with specific requirements set forth in such guidance, the Korean tax on interest will be treated as meeting the new requirements and therefore as a creditable tax. In the case of all other U.S. holders, the application of these requirements to the Korean tax on interest is uncertain and we have not determined whether these requirements have been met. If the Korean interest tax is not a creditable tax or you do not elect to claim a foreign tax credit for any foreign income taxes, you may be able to deduct the Korean tax in computing your taxable income for U.S. federal income tax purposes. Interest and additional amounts will constitute income from sources without the United States and, if you elect to claim foreign tax credits, generally will constitute "passive category income" for foreign tax credit purposes.

The availability and calculation of foreign tax credits and deductions for foreign taxes depend on a U.S. holder's particular circumstances and involve the application of complex rules to those circumstances. The temporary guidance discussed above also indicates that the Treasury and the IRS are considering proposing amendments to the December 2021 regulations and that the temporary guidance can be relied upon until additional guidance is issued that withdraws or modifies the temporary guidance. You should consult your tax advisers regarding the application of these rules to your particular situations.

***Purchase, Sale and Retirement of Debt Securities***

Initially, your tax basis in a debt security generally will equal the cost of the debt security to you. Your basis will increase by any amounts that you are required to include in income under the rules governing original issue discount and market discount, and will decrease by the amount of any amortized premium and any payments other than qualified stated interest made on the debt security. The rules for determining these amounts are discussed below. If you purchase a debt security that is denominated in a foreign currency, the cost to you, and therefore generally your initial tax basis, will be the U.S. dollar value of the foreign currency purchase price on the date of purchase calculated at the exchange rate in effect on that date. If the foreign currency-denominated debt security is traded on an established securities market and you are a cash-basis taxpayer, or if you are an accrual-basis taxpayer that makes a special election, then you will determine the U.S. dollar value of the cost of the debt security by translating the amount of the foreign currency that you paid for the debt security at the spot rate of exchange on the settlement date of your purchase. The amount of any subsequent adjustments to your tax basis in a foreign currency-denominated debt security in respect of original issue discount, market discount and premium will be determined in the manner described below. If you convert U.S. dollars into a foreign currency and then immediately use that foreign currency to purchase a debt security, you generally will not have any taxable gain or loss as a result of the purchase.

When you sell or exchange a debt security, or if a debt security is retired, you generally will recognize gain or loss equal to the difference between the amount you realize on the transaction, less any accrued qualified stated interest, which will be subject to tax in the manner described above, and your tax basis in the debt security. If you sell or exchange a debt security for a foreign currency, or receive foreign currency on the retirement of a debt security, the amount you will realize for U.S. federal income tax purposes generally will be the U.S. dollar value of the foreign currency that you receive calculated at the exchange rate in effect on the date the foreign

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currency debt security is disposed of or retired. If you dispose of a foreign currency debt security that is traded on an established securities market and you are a cash-basis U.S. holder, or if you are an accrual-basis holder that makes a special election, then you will determine the U.S. dollar value of the amount realized by translating the amount received at the spot rate of exchange on the settlement date of the sale, exchange or retirement.

The special election available for accrual-basis taxpayers in respect of the purchase and sale of foreign currency debt securities traded on an established securities market, which is discussed in the two preceding paragraphs, must be applied consistently to all debt instruments from year to year and cannot be changed without the consent of the IRS.

Except as discussed below with respect to market discount, short-term debt securities and foreign currency gain or loss, the gain or loss that you recognize on the sale, exchange or retirement of a debt security generally will be long-term capital gain or loss if you have held the debt security for more than one year. The Code provides preferential treatment under certain circumstances for net long-term capital gains recognized by individual investors. The ability of U.S. holders to offset capital losses against ordinary income is limited.

Despite the foregoing, the gain or loss that you recognize on the sale, exchange or retirement of a foreign currency debt security generally will be treated as ordinary income or loss to the extent that the gain or loss is attributable to changes in exchange rates during the period in which you held the debt security. However, any such foreign currency gain or loss (including any foreign currency gain or loss with respect to the receipt of accrued but unpaid interest) will be realized only to the extent of total gain or loss realized on the sale or retirement. This foreign currency gain or loss will not be treated as an adjustment to interest income that you receive on the debt security.

Under the foreign tax credit requirements adopted by the IRS in regulations promulgated in December 2021, a U.S. holder generally will not be entitled to credit any Korean tax imposed on the sale or other disposition of a debt security against such U.S. holder's U.S. federal income tax liability, except in the case of a U.S. holder that consistently elects to apply a modified version of the U.S. foreign tax credit rules that is permitted under recently issued temporary guidance and complies with the specific requirements set forth in such guidance. Additionally, capital gain or loss recognized by a U.S. holder on the sale or other disposition of a debt security generally will be U.S.-source gain or loss for U.S. foreign tax credit purposes. Consequently, even if the withholding tax qualifies as a creditable tax, you may not be able to credit the tax against your U.S. federal income tax liability unless such credit can be applied (subject to generally applicable conditions and limitations) against tax due on other income treated as derived from foreign sources. If the Korean tax is not a creditable tax, the tax would reduce the amount realized on the sale or other disposition of a debt security even if you have elected to claim a foreign tax credit for other taxes in the same year. The temporary guidance discussed above also indicates that the Treasury and the IRS are considering proposing amendments to the December 2021 regulations and that the temporary guidance can be relied upon until additional guidance is issued that withdraws or modifies the temporary guidance. You should consult your tax advisers regarding the application of the foreign tax credit rules to a sale or other disposition of a debt security and any Korean tax imposed on such sale or disposition.

***Original Issue Discount***

If we issue debt securities at a discount from their "stated redemption price at maturity," and the discount is equal to or more than the product of one-fourth of one percent (0.25%) of the "stated redemption price at maturity" of the debt securities multiplied by the number of whole years to their maturity (the "*de minimis* threshold"), the debt securities will be "Original Issue Discount Debt Securities." The difference between the issue price and their "stated redemption price at maturity" will be the "original issue discount." The "issue price" of the debt securities will be the first price at which a substantial amount of the debt securities are sold to the public (i.e., excluding sales of debt securities to underwriters, placement agents, wholesalers, or similar persons). The "stated redemption price at maturity" will include all payments under the debt securities other than payments of qualified stated interest. The term "qualified stated interest" generally means stated interest that is

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unconditionally payable in cash or property, other than debt instruments issued by the Company, at least annually during the entire term of a debt security at a single fixed interest rate or, subject to certain conditions, based on one or more interest indices.

If you invest in Original Issue Discount Debt Securities you generally will be subject to the special tax accounting rules for original issue discount obligations provided by the Code and certain Treasury regulations, or the OID regulations. You should be aware that, as described in greater detail below, if you invest in an Original Issue Discount Debt Security you generally will be required to include original issue discount in ordinary gross income for U.S. federal income tax purposes as it accrues, before you receive the cash attributable to that income.

In general, and regardless of whether you use the cash or the accrual method of tax accounting, if you are the holder of an Original Issue Discount Debt Security with a maturity greater than one year, you will be required to include in ordinary gross income the sum of the "daily portions" of original issue discount on that debt security for all days during the taxable year that you own the debt security. The daily portions of original issue discount on an Original Issue Discount Debt Security are determined by allocating to each day in any accrual period a ratable portion of the original issue discount allocable to that accrual period. Accrual periods may be any length and may vary in length over the term of an Original Issue Discount Debt Security, so long as no accrual period is longer than one year and each scheduled payment of principal or interest occurs on the first or last day of an accrual period. If you are the initial holder of the debt security, the amount of original issue discount on an Original Issue Discount Debt Security allocable to each accrual period is determined by:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) multiplying the "adjusted issue price" (as defined below) of the debt security at the beginning of
the accrual period by a fraction, the numerator of which is the annual yield to maturity of the debt security and the denominator of which is the number of accrual periods in a year; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) subtracting from that product the amount, if any, payable as qualified stated interest allocable to that
accrual period.

In the case of an Original Issue Discount Debt Security that is a floating rate debt security, both the "annual yield to maturity" and the qualified stated interest will be determined for these purposes as though the debt security had borne interest in all periods at a fixed rate generally equal to the rate that would be applicable to interest payments on the debt security on its date of issue or, in the case of some floating rate debt securities, the rate that reflects the yield that is reasonably expected for the debt security. Additional rules may apply if interest on a floating rate debt security is based on more than one interest index. The "adjusted issue price" of an Original Issue Discount Debt Security at the beginning of any accrual period will generally be the sum of its issue price, including any accrued interest, and the amount of original issue discount allocable to all prior accrual periods, reduced by the amount of all payments other than any qualified stated interest payments on the debt security in all prior accrual periods. All payments on an Original Issue Discount Debt Security, other than qualified stated interest, will generally be viewed first as payments of previously accrued original issue discount, to the extent of the previously accrued discount, with payments considered made from the earliest accrual periods first, and then as a payment of principal. The "annual yield to maturity" of a debt security is the discount rate, appropriately adjusted to reflect the length of accrual periods, that causes the present value on the issue date of all payments on the debt security to equal the issue price. As a result of this "constant yield" method of including original issue discount income, the amounts you will be required to include in your gross income if you invest in an Original Issue Discount Debt Security denominated in U.S. dollars will generally be less in the early years and greater in the later years than amounts that would be includible on a straight-line basis.

You generally may make an irrevocable election to include in income your entire return on a debt security (i.e., the excess of all remaining payments to be received on the debt security, including payments of qualified stated interest, over the amount you paid for the debt security) under the constant yield method described above. For debt securities purchased at a premium or bearing market discount in your hands, if you make this election you will also be deemed to have made the election (discussed below under "—Premium and Market Discount") to amortize premium or to accrue market discount in income currently on a constant yield basis.

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In the case of an Original Issue Discount Debt Security that is also a foreign currency-denominated debt security, you should determine the U.S. dollar amount includible as original issue discount for each accrual period by (i) calculating the amount of original issue discount allocable to each accrual period in the foreign currency using the constant yield method, and (ii) translating the foreign currency amount so determined at the average exchange rate in effect during that accrual period (or, with respect to an interest accrual period that spans two taxable years, at the average exchange rate for each partial period). Alternatively, you may translate the foreign currency amount so determined at the spot rate of exchange on the last day of the accrual period (or the last day of the taxable year, for an accrual period that spans two taxable years), or at the spot rate of exchange on the date of receipt, if that date is within five business days of the last day of the accrual period, provided that you have made the election described under "—Payments or Accruals of Interest" above. Because exchange rates may fluctuate, if you are the holder of an Original Issue Discount Debt Security that is also a foreign currency debt security you may recognize a different amount of original issue discount income in each accrual period than would be the case if you were the holder of an otherwise similar Original Issue Discount Debt Security denominated in U.S. dollars. Upon the receipt of an amount attributable to original issue discount, whether in connection with a payment of an amount that is not qualified stated interest or the sale or retirement of the Original Issue Discount Debt Security, you will recognize ordinary income or loss measured by the difference between the amount received, translated into U.S. dollars at the exchange rate in effect on the date of receipt or on the date of disposition of the Original Issue Discount Debt Security, as the case may be, and the amount accrued, using the exchange rate applicable to such previous accrual.

If you purchase an Original Issue Discount Debt Security outside of the initial offering at a cost less than its "remaining redemption amount", or if you purchase an Original Issue Discount Debt Security in the initial offering at a price other than the debt security's issue price, you will also generally be required to include in gross income the daily portions of original issue discount, calculated as described above. However, if you acquire an Original Issue Discount Debt Security at a price greater than its adjusted issue price, you will be required to reduce your periodic inclusions of original issue discount to reflect the premium paid over the adjusted issue price. The remaining redemption amount for an Original Issue Discount Debt Security is the total of all future payments to be made on the debt security other than qualified stated interest.

Floating rate debt securities generally will be treated as "variable rate debt instruments" under the OID regulations. Accordingly, the stated interest on a floating rate debt security generally will be treated as qualified stated interest, and such a debt security will not have original issue discount solely as a result of the fact that it provides for interest at a variable rate. A floating rate debt security that does not qualify as a variable rate debt instrument will be subject to special rules (the "contingent payment regulations") that govern the tax treatment of debt obligations that provide for contingent payments ("contingent debt obligations"). A detailed description of the tax considerations relevant to U.S. holders of any such debt securities will be provided in the applicable prospectus supplement.

Certain debt securities may be redeemed prior to maturity, either at our option or at the option of the holder, or may have special repayment or interest rate reset features as indicated in the prospectus supplement. Original Issue Discount Debt Securities containing these features may be subject to rules that differ from the general rules discussed above. If you purchase Original Issue Discount Debt Securities with these features, you should carefully examine the prospectus supplement and consult your tax adviser about their treatment since the tax consequences with respect to original issue discount will depend, in part, on the particular terms and features of the debt securities.

If a debt security provides for a scheduled accrual period that is longer than one year (for example, as a result of a long initial period on a debt security with interest that is generally paid on an annual basis), then stated interest on the debt security will not qualify as "qualified stated interest" under the OID Regulations. As a result, the debt security would be an Original Issue Discount Debt Security. In that event, among other things, if you are a cash-method U.S. holder you will be required to accrue stated interest on the debt security under the rules for original issue discount described above, and regardless of your method of accounting for U.S. federal income tax purposes, you will be required to accrue original issue discount that would otherwise fall under the *de minimis* threshold.

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***Short-Term Debt Securities***

The rules described above will also generally apply to Original Issue Discount Debt Securities with maturities of one year or less ("short-term debt securities"), but with some modifications.

First, the original issue discount rules treat none of the interest on a short-term debt security as qualified stated interest, but treat a short-term debt security as having original issue discount. Thus, all short-term debt securities will be Original Issue Discount Debt Securities. Except as noted below, if you are a cash-basis holder of a short-term debt security and are not a bank, securities dealer, regulated investment company or common trust fund and you do not identify the short-term debt security as part of a hedging transaction you will generally not be required to accrue original issue discount currently, but you will be required to treat any gain realized on a sale, exchange or retirement of the debt security as ordinary income to the extent such gain does not exceed the original issue discount accrued with respect to the debt security during the period you held the debt security. You may not be allowed to deduct all of the interest paid or accrued on any indebtedness incurred or maintained to purchase or carry a short-term debt security until the maturity of the debt security or its earlier disposition in a taxable transaction. Notwithstanding the foregoing, if you are a cash-basis U.S. holder of a short-term debt security you may elect to accrue original issue discount on a current basis, in which case the limitation on the deductibility of interest described above will not apply. A U.S. holder using the accrual method of tax accounting and some cash method holders, including banks, securities dealers, regulated investment companies and common trust funds, generally will be required to include original issue discount on a short-term debt security in gross income on a current basis. Original issue discount will be treated as accruing for these purposes on a ratable basis or, at the election of the holder, on a constant yield basis based on daily compounding.

Second, regardless of whether you are a cash- or accrual-basis holder, if you are the holder of a short-term debt security you can elect to accrue any "acquisition discount" with respect to the debt security on a current basis. Acquisition discount is the excess of the debt security's "stated redemption price at maturity" (i.e., all amounts payable on the short-term debt security) over the purchase price. Acquisition discount will be treated as accruing ratably or, at the election of the holder, under a constant yield method based on daily compounding. If you elect to accrue acquisition discount, the original issue discount rules will not apply.

Finally, the market discount rules described below will not apply to short-term debt securities.

As described above, certain debt securities may be subject to special redemption features. These features may affect the determination of whether a debt security has a maturity of one year or less and thus is a short-term debt security. If you purchase debt securities with these features, you should carefully examine the prospectus supplement and consult your tax adviser about these features.

***Premium and Market Discount***

If you purchase a debt security at a cost greater than the debt security's remaining redemption amount, you will be considered to have purchased the debt security at a premium, and you may elect to amortize the premium as an offset to interest income, using a constant yield method, over the remaining term of the debt security. If you make this election, it generally will apply to all debt instruments that you hold at the time of the election, as well as any debt instruments that you subsequently acquire. In addition, you may not revoke the election without the consent of the IRS. If you elect to amortize the premium you will be required to reduce your tax basis in the debt security by the amount of the premium amortized during your holding period. Original Issue Discount Debt Securities purchased at a premium will not be subject to the original issue discount rules described above. In the case of premium on a foreign currency debt security, you should calculate the amortization of the premium in the foreign currency. Amortization deductions attributable to a period reduce interest payments in respect of that period, and therefore are translated into U.S. dollars at the rate that you use for those interest payments. Exchange gain or loss will be realized with respect to amortized premium on a foreign currency debt security based on the difference between the exchange rate computed on the date or dates the premium is amortized against interest payments on the debt security and the exchange rate on the date when the U.S. holder acquired

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the debt security. For a U.S. holder that does not elect to amortize premium, the amount of premium will be included in your tax basis when the debt security matures or is disposed of. Therefore, if you do not elect to amortize premium and you hold the debt security to maturity, you generally will be required to treat the premium as capital loss when the debt security matures.

If you purchase a debt security at a price that is lower than the debt security's remaining redemption amount, or in the case of an Original Issue Discount Debt Security, the debt security's adjusted issue price, by 0.25% or more of the remaining redemption amount, or adjusted issue price, multiplied by the number of remaining whole years to maturity, the debt security will be considered to bear "market discount" in your hands. In this case, any gain that you realize on the disposition of the debt security generally will be treated as ordinary interest income to the extent of the market discount that accrued on the debt security during your holding period. In addition, you could be required to defer the deduction of a portion of the interest paid on any indebtedness that you incurred or continued to purchase or carry the debt security. In general, market discount will be treated as accruing ratably over the term of the debt security, or, at your election, under a constant yield method. You must accrue market discount on a foreign currency debt security in the specified currency. The amount that you will be required to include in income in respect of accrued market discount will be the U.S. dollar value of the accrued amount, generally calculated at the exchange rate in effect on the date that you dispose of the debt security.

You may elect to include market discount in gross income currently as it accrues (on either a ratable or constant yield basis), in lieu of treating a portion of any gain realized on a sale of the debt security as ordinary income. If you elect to include market discount on a current basis, the interest deduction deferral rule described above will not apply. If you do make such an election, it will apply to all market discount debt instruments that you acquire on or after the first day of the first taxable year to which the election applies. The election may not be revoked without the consent of the IRS. Any accrued market discount on a foreign currency debt security that is currently includible in income will be translated into U.S. dollars at the average exchange rate for the accrual period (or portion thereof within your taxable year).

***Indexed Debt Securities and Other Debt Securities Providing for Contingent Payments***

The contingent payment regulations generally require accrual of interest income on a constant yield basis in respect of contingent debt obligations at a yield determined at the time of issuance of the obligation, and may require adjustments to these accruals when any contingent payments are made. In addition, special rules may apply to floating rate debt securities if the interest payable on the debt securities is based on more than one interest index. We will provide a detailed description of the tax considerations relevant to U.S. holders of any debt securities that are subject to the special rules discussed in this paragraph in the relevant prospectus supplement.

***Foreign Currency-Denominated Debt Securities and Reportable Transactions***

A U.S. holder that participates in a "reportable transaction" will be required to disclose its participation to the IRS. The scope and application of these rules is not entirely clear. A U.S. holder may be required to treat a foreign currency exchange loss relating to a foreign currency-denominated debt security as a reportable transaction if the loss equals or exceeds $50,000 in a single taxable year if the U.S. holder is an individual or trust, or higher amounts for other U.S. holders. In the event the acquisition, ownership or disposition of a foreign currency-denominated debt security constitutes participation in a "reportable transaction" for purposes of these rules, a U.S. holder will be required to disclose its investment to the Internal Revenue Service, currently on IRS Form 8886. Prospective purchasers should consult their tax advisers regarding the application of these rules to the acquisition, ownership or disposition of foreign currency-denominated debt securities.

***Specified Foreign Financial Assets***

Individual U.S. holders that own "specified foreign financial assets" with an aggregate value in excess of $50,000 on the last day of the taxable year or $75,000 at any time during the taxable year are generally required

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to file an information statement along with their tax returns, currently on IRS Form 8938, with respect to such assets. "Specified foreign financial assets" include any financial accounts held at a non-U.S. financial institution, as well as securities issued by a non-U.S. issuer (which may include debt securities issued in certificated form) that are not held in accounts maintained by financial institutions. Higher reporting thresholds apply to certain individuals living abroad and to certain married individuals. Regulations extend this reporting requirement to certain entities that are treated as formed or availed of to hold direct or indirect interests in specified foreign financial assets based on certain objective criteria. U.S. holders who fail to report the required information could be subject to substantial penalties. In addition, the statute of limitations for assessment of tax would be suspended, in whole or part. Prospective investors should consult their own tax advisers concerning the application of these rules to their investment in the debt securities, including the application of the rules to their particular circumstances.

***Information Reporting and Backup Withholding***

The paying agent must file information returns with the IRS in connection with debt security payments made to certain United States persons. If you are a United States person, you generally will not be subject to U.S. backup withholding tax on such payments if you provide your taxpayer identification number to the paying agent. You may also be subject to information reporting and backup withholding tax requirements with respect to the proceeds from a sale of the debt securities. If you are not a United States person, in order to avoid information reporting and backup withholding tax requirements you may have to comply with certification procedures to establish that you are not a United States person. The amount of any backup withholding from a payment to a holder will be allowed as a credit against the holder's U.S. federal income tax liability and may entitle the holder to a refund, provided that the required information is timely furnished to the IRS.

***Foreign Account Tax Compliance Act***

We or a non-U.S. financial institution through which payments are made may be required pursuant to FATCA to collect and provide to the IRS or another tax authority substantial information regarding investors in debt securities. As such, holders may be required to provide information and tax documentation regarding their tax identities as well as that of their direct and indirect owners. Moreover, we, any paying agents, and other financial institutions through which payments are made, may be required to withhold U.S. tax at a 30% rate on "foreign passthru payments" (a term not yet defined) paid to an investor who does not provide information sufficient for the institution to determine whether the investor is a United States person or should otherwise be treated as holding a "United States account" of the institution, or to an investor that is, or holds the debt securities directly or indirectly through, a non-U.S. financial institution that is not in compliance with FATCA. Under a grandfathering rule, this withholding tax will not apply unless the debt securities are issued or materially modified after the date that is six months after the date on which final U.S. Treasury Regulations defining the term "foreign passthru payment" are filed with the U.S. Federal Register.

By purchasing the debt securities, U.S. holders agree to provide an IRS form W-9, and whatever other information may be necessary for us to comply with these reporting obligations. If an amount of, or in respect of, U.S. withholding tax were to be deducted or withheld from payments on the debt securities as a result of an investor's failure to comply with these rules, neither we nor any paying agent nor any other person would be required to pay additional amounts with respect to any debt securities as a result of the deduction or withholding of such tax. You should consult your tax advisers on how FATCA may apply to payments you receive under the debt securities.

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**PLAN OF DISTRIBUTION** 

We and the Republic, if a guarantee by the Republic is furnished, may sell or issue the debt securities, warrants or guarantees in any of three ways:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• through underwriters or dealers;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• directly to one or more purchasers; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• through agents.

The prospectus supplement relating to a particular series of debt securities, warrants or guarantees will state:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the names of any underwriters;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the purchase price of the securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the proceeds to us from the sale;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any underwriting discounts and other compensation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the initial public offering price;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any discounts or concessions allowed or paid to dealers; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• any securities exchanges on which the securities will be listed.

Any underwriter involved in the sale of securities will acquire the securities for its own account. The underwriters may resell the securities from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices to be determined at the time of sale. The securities may be offered to the public either by underwriting syndicates represented by managing underwriters or by underwriters without a syndicate. Unless the prospectus supplement states otherwise, certain conditions must be satisfied before the underwriters become obligated to purchase securities from us and the Republic, if applicable, and they will be obligated to purchase all of the securities if any are purchased. The underwriters may change any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers.

If we and the Republic, if a guarantee by the Republic is furnished, sell any securities through agents, the prospectus supplement will identify the agent and indicate any commissions payable by us and the Republic, if applicable. Unless the prospectus supplement states otherwise, all agents will act on a best efforts basis and will not acquire the securities for their own account.

We and the Republic, if a guarantee by the Republic is furnished, may authorize agents, underwriters or dealers to solicit offers by certain specified entities to purchase the securities from us and the Republic, if applicable, at the public offering price set forth in a prospectus supplement pursuant to delayed delivery contracts. The prospectus supplement will set out the conditions of the delayed delivery contracts and the commission receivable by the agents, underwriters or dealers for soliciting the contracts.

We and the Republic, if a guarantee by the Republic is furnished, may offer debt securities as consideration for the purchase of other of our debt securities, either in connection with a publicly announced tender offer or in privately negotiated transactions. The offer may be in addition to or in lieu of sales of debt securities directly or through underwriters or agents. We may offer guarantees as consideration for transactions involving securities of other issuers.

Agents and underwriters may be entitled to indemnification by us against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to contribution from us with respect to certain payments which the agents or underwriters may be required to make. Agents and underwriters may be customers of, engage in transactions with, or perform services (including commercial and investment banking services) for us and the Republic in the ordinary course of business.

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**LEGAL MATTERS** 

The validity of any particular series of debt securities or warrants issued with debt securities or any guarantees will be passed upon for us and any underwriters or agents by United States and Korean counsel identified in the related prospectus supplement.

**AUTHORIZED REPRESENTATIVES IN THE UNITED STATES** 

Our authorized agents in the United States are Mr. Tae Jeong Yun, General Manager of our New York Branch, or Mr. Jinwon Kim, Deputy General Manager of our New York Branch. The address of our New York Branch is 320 Park Avenue, 32nd Floor, New York, New York 10022. The authorized representative of the Republic in the United States is Mr. Munkyu Park, Financial Attaché, Korean Consulate General in New York, located at 460 Park Avenue, 9th Floor, New York, New York 10022.

**OFFICIAL STATEMENTS AND DOCUMENTS** 

Our President and Chairman of the Board of Directors, in his official capacity, has supplied the information set forth under "The Korea Development Bank" (except for the information set out under "The Korea Development Bank—Business—Government Support and Supervision"). Such information is stated on his authority.

The Acting Minister of Economy and Finance of The Republic of Korea, in his official capacity, has supplied the information set out under "The Korea Development Bank—Business—Government Support and Supervision" and "The Republic of Korea." Such information is stated on his authority. The documents identified in the portion of this prospectus captioned "The Republic of Korea" as the sources of financial or statistical data are official public documents of the Republic or its agencies and instrumentalities.

**EXPERTS** 

Our separate financial statements as of and for the years ended December 31, 2024 and 2023 have been included in this prospectus in reliance upon the report of Nexia Samduk, independent auditors, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.

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**FORWARD-LOOKING STATEMENTS** 

This prospectus includes future expectations, projections or "forward-looking statements", as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "believe", "expect", "anticipate", "estimate", "project" and similar words identify forward-looking statements. In addition, all statements other than statements of historical facts included in this prospectus are forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we can give no assurance that such expectations will prove correct. This prospectus discloses important factors that could cause actual results to differ materially from our expectations, or Cautionary Statements. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the Cautionary Statements.

Factors that could adversely affect the future performance of the Korean economy include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• declines in consumer confidence and a slowdown in consumer spending including as a result of higher levels of
market interest rates;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• political uncertainty or increasing strife among or within political parties in Korea and the ensuing societal
unrest, including as a result of the impeachment of President Yoon Suk-yeol in April 2025 following his declaration of martial law in December 2024 (which declaration had been swiftly rescinded), as a result
of which a special presidential election to elect his successor will be held on June 3, 2025;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the occurrence of severe health epidemics in Korea or other parts of the world, including the COVID-19 pandemic, swine or avian flu, Ebola or Middle East respiratory syndrome;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• hostilities, political or social tensions involving Russia (including the Russia-Ukraine war and the ensuing
actions that the United States and other countries have taken or may take in the future, such as the imposition of sanctions against Russia) and the resulting adverse effects on the global supply of oil and other natural resources and the global
financial markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• adverse conditions or developments in the economies of countries and regions that are important export markets
for Korea, such as the United States, Europe, Japan and China, or in emerging market economies in Asia or elsewhere, including as a result of the deterioration of economic and trade relations among such countries or impositions of significant
tariffs by any such country and increased uncertainties in the global financial markets and industry;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• disruptions in the global supply chain for raw materials, natural resources, consumer goods, rare earth minerals,
component parts and other supplies, including semiconductors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• interest rate fluctuations as well as perceived or actual changes in policy rates, or other monetary and fiscal
policies set forth, by the U.S. Federal Reserve, Korea and other central banks;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• rising inflationary pressures leading to increases in the costs of goods and services and a decrease in
purchasing power;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• adverse changes or volatility in foreign currency reserve levels, commodity prices (including oil prices),
exchange rates (including fluctuation of the U.S. dollar or the Euro exchange rates or revaluation of the Chinese Yuan), interest rates, inflation rates or stock markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• difficulties in the financial sectors and increased sovereign default risks in select countries and the resulting
adverse effects on the global financial markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a substantial decrease in tax revenues and a substantial increase in the Government's expenditures for
fiscal stimulus measures, unemployment compensation and other economic and social programs, which, together, would lead to an increased Government budget deficit as well as an increase in the Government's debt;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a continuing rise in the level of household debt and increasing delinquencies and credit defaults by retail and
small- and medium-sized enterprise borrowers in Korea;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• substantial changes in the market prices of Korean real estate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• investigations of large Korean business groups and their senior management for possible misconduct;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the economic impact of any pending or future free trade agreements or of any changes to existing free trade
agreements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the imposition of significant tariffs on the Republic's exports by any of the Republic's major export
markets, such as the imposition of a 25% tariff on the Republic's exports to the United States announced in April 2025, which has since been paused for a period of 90 days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• shortages of imported raw materials, natural resources, rare earth minerals or component parts due to disruptions
to the global supply chain;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• social and labor unrest;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• financial problems or lack of progress in the restructuring of Korean business groups, other large troubled
companies, their suppliers or the financial sector;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• loss of investor confidence arising from corporate accounting irregularities or corporate governance issues at
certain Korean companies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• increases in social expenditures to support an aging population in Korea or decreases in economic productivity
due to the declining population size in Korea;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a continued decrease in the population and birthrates in Korea;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• geopolitical uncertainty and risk of further attacks by terrorist groups around the world;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• a deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including
deterioration resulting from territorial or trade disputes or disagreements in foreign policy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• natural or man-made disasters that have a significant adverse economic or
other impact on Korea or its major trading partners;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• hostilities or political or social tensions involving countries in the Middle East (including those resulting
from the hostilities in the Middle East following the Israel-Hamas war) and Northern Africa and any material disruption in the supply of oil or sudden changes in the price of oil; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• an increase in the level of tensions or an outbreak of hostilities between North Korea and Korea or the United
States.

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**FURTHER INFORMATION** 

We filed a registration statement with respect to the securities with the Securities and Exchange Commission under the Securities Act of 1933, as amended, and its related rules and regulations. You can find additional information concerning ourselves and the securities in the registration statement and any pre- or post-effective amendment, including its various exhibits, which may be inspected at the public reference facilities maintained by the Securities and Exchange Commission at 100 F Street, N.E., Washington, D.C. 20549. These filings are also available to the public from the Securities and Exchange Commission's website at http://www.sec.gov. Our Internet address is https://www.kdb.co.kr.

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**HEAD OFFICE OF THE BANK** 

**14, Eunhaeng-ro** 

**Yeongdeungpo-gu, Seoul 07242** 

**The Republic of Korea** 

**FISCAL AGENT AND PRINCIPAL PAYING AGENT** 

**The Bank of New York Mellon** 

**London Branch** 

**One Canada Square** 

**London E14 5AL** 

**United Kingdom** 

**LEGAL ADVISORS TO THE BANK** 

---

| | |
|:---|:---|
| *as to Korean law* | *as to U.S. law* |
| **Shin & Kim LLC**<br> **23F, D-Tower (D2) 17**<br> **Jongno 3-gil, Jongno-gu**<br> **Seoul 03155**<br> **The Republic of Korea** | **Cleary Gottlieb Steen & Hamilton LLP**<br> **c/o 19th Floor, Ferrum Tower**<br> **19 Eulji-ro 5-gil, Jung-gu**<br> **Seoul 04539**<br> **The Republic of Korea** |

---

**LEGAL ADVISOR TO THE UNDERWRITERS** 

*as to U.S. law* 

**Linklaters LLP** 

**22nd Floor, Center One Building** 

**26, Eulji-ro 5-gil, Jung-gu** 

**Seoul 04539** 

**The Republic of Korea** 

**AUDITOR OF THE BANK** 

**Nexia Samduk** 

**12F, S&S Building** 

**48 Ujeongguk-ro, Jongno-gu** 

**Seoul 03145** 

**The Republic of Korea** 

**SINGAPORE LISTING AGENT** 

**Shook Lin & Bok LLP** 

**1 Robinson Road** 

**#18-00 AIA Tower** 

**Singapore 048542** 

**LONDON LISTING AGENT** 

**Cleary Gottlieb Steen & Hamilton LLP** 

**2 London Wall Place** 

**London EC2Y 5AU** 

**England** 

**LUXEMBOURG LISTING AGENT** 

**Arendt & Medernach SA** 

**41A, Avenue John F. Kennedy** 

**L-2082** 

**Luxembourg** 

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![LOGO](g82964g03g03.jpg)