Document:

Memorandum of Understanding between KDIC and Woori Finance Holdings

 Exhibit 4.1 
  
 AGREEMENT 
 ON 
 IMPLEMENTATION OF THE MANAGEMENT IMPROVEMENT PLAN 
  
 This Agreement on Implementation of the Management Improvement Plan is made and entered into by and between the Korea Deposit Insurance Corporation (“KDIC”), a
special entity established and existing under the Depositor Protection Act to protect depositors and maintain the stability of the financial system, and Woori Finance Holdings Co., Ltd. (“WFH”), a financial holding company newly
established by KDIC whose all equity stakes in Hanvit Bank, Peace Bank of Korea, Kwangju Bank, Kyongnam Bank, and Hanaro Merchant Bank (collectively, the “Subsidiaries”) was comprehensively transferred to WFH pursuant to Article 31 of the
Financial Holding Company Act, by which WFH undertakes to fully implement in good faith the plans specified in the Management Improvement Plans attached hereto as Appendices (“Management Improvement Plans”) so as to become a leading
financial institution in Korea by expediting the operational normalization of the Subsidiaries and establishing an efficiently-integrated operational system among the Subsidiaries and WFH, in accordance with the purposes set forth in Article 17 of
the Public Fund Management Special Act, as follows: 
  
 Article 1 Purpose

  

	 	1.1	 	The purpose of this Agreement is to set forth the terms and conditions required for WFH to expressly specify and fully implement the Management Improvement Plans so that KDIC may
recuperate the public funds invested by it in the Subsidiaries in a timely and profitable manner. 

  
 Article 2 Obligations to Implement the Management Improvement Plan 
  

	 	2.1	 	WFH shall be obligated to implement in good faith the Management Improvement Plans except for the occurrence of a natural disaster, material national economic crisis or any other
events of the force majeure (collectively, the “Event of Force Majeure”). 

  

	 	2.2	 	WFH shall obtain and submit to KDIC the Letter of Undertaking, in the form designated under the Management Improvement Plans as attached hereto, each of which shall have been signed
by the incumbent officers as of the effective date of this Agreement and any other officer to be appointed during the term of this Agreement. 

  

	 	2.3	 	Except for the case where WFH fails to perform its obligations to implement the Management Improvement Plans in the Event of the Force Majeure as specified in Section 2.1 above, WFH
shall not claim that such failure was not caused by or resulted from its willful misconduct or negligence or any other similar reasons attributable to it. Furthermore, WFH shall not claim that any problems arising out of the relationship with the
officers or employees, labor unions, creditors, debtors or any other interested parties of it or its respective Subsidiaries shall be deemed as one of the Events of Force Majeure. 

  
 Article 3 Detailed Implementation Plans for the Management Improvement Plans

  

	 	3.1	 	KDIC may request WFH to submit a Detailed Implementation Plans required or desirable for WFH’s implementation of the Management Improvement Plan when KDIC deems it necessary to
do so, and WFH shall submit to KDIC the Detailed Implementation Plans within two (2) months from the receipt of such requests. 

  

	 	3.2	 	KDIC may request WFH to modify the Detailed Implementation Plans if KDIC deems it necessary to do so after the review thereof, and WFH shall reflect such modification as requested
by KDIC to the Detailed Implementation Plans. 

  

 Article 4 Request for Amendment to the Management Improvement Plans 
  

	 	4.1	 	In the event where it is deemed that WFH is not likely to implement the Management Improvement Plans due to revision of applicable laws and regulations, changes in the external
environments such as substantial changes in the market conditions, changes in its business strategies and results of examination for its business operation, WFH may immediately report to KDIC thereof and subsequently submit to KDIC the amendments to
the Management Improvement Plans (“Proposed Amendments to the Management Improvement Plans”). 

  

	 	4.2	 	If KDIC concludes that the Proposed Amendments to the Management Improvement Plans submitted by the WFH is reasonable after review thereof, KDIC may adopt them. In that case, a part
of the Management Improvement Plans shall be deemed to be amended and replaced with the relevant parts specified in the “Proposed Amendments to the Management Improvement Plans. 

  

	 	4.3	 	KDIC may request WFH to modify the Proposed Amendments to the Management Improvement Plans submitted by WFH under Section 4.1 above when KDIC deems it necessary to do so, and WFH
shall reflect such modifications as requested by KDIC to the Proposed Amendments to the Management Improvement Plans. 

  

	 	4.4	 	In case the event described in Section 4.1 occurs or in any other event that may threaten the attainment of the objectives under the Management Improvement Plan, KDIC may request
WFH to modify the Management Improvement Plan. 

  
 Article 5
Supplement to the Management Improvement Plan 
  

	 	5.1	 	In the event this Agreement remains fully effective and enforceable two (2) months prior to the expiration of the Management Improvement Plan, WFH shall submit to KDIC any plans
proposed for supplement to the Management Improvement Plan (“Proposed Supplements to the Management Improvement Plans”). 

  

	 	5.2	 	KDIC may request WFH to modify the Proposed Supplements to the Management Improvement Plans submitted by WFH under Section 4.1 above when KDIC deems it necessary to do so, and WFH
shall reflect such modifications as requested by KDIC to the Proposed Supplements to the Management Improvement Plans. 

  
 Article 6 Execution of Agreement between WFH and the Subsidiaries 
  

	 	6.1	 	WFH shall enter into with each of the Subsidiaries an agreement on the management of the implementation of the Management Improvement Plans (“Implementation Management
Agreement”), which shall be submitted to KDIC as a Schedule attached hereto, for the purpose of assigning and managing the specific business goals to each Subsidiary so that WFH may successfully attain the goals under the Management Improvement
Plans. 

  

	 	6.2	 	The Implementation Management Agreement shall include each of the following items: 

  

	 	6.2.1	 	Purpose of the Implementation Management Agreement; 

	 	6.2.2	 	Role of WFH; 

	 	6.2.3	 	Role of each Subsidiary; 

	 	6.2.4	 	Submission of action plans by each Subsidiary; 

	 	6.2.5	 	Financial and non-financial objectives of each Subsidiary; 

	 	6.2.6	 	Procedure for amendment and supplement to the Implementation Management Agreement; 

	 	6.2.7	 	The request by WFH for amendment to the agreement on the business normalization plans and performance thereof entered into between KDIC and each Subsidiary (“Agreement on the
Business Normalization Plans”) and the procedures therefor; 

	 	6.2.8	 	Measures to be taken by WFH against any failure by each Subsidiary to attain its business goals; 

	 	6.2.9	 	Effective term of the Implementation Management Agreement; and 

  

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	 	6.2.10	 	Any other matters necessary for carrying out the management strategies of WFH. 

  

	 	6.3	 	In the event there are any discrepancies between the Implementation Management Agreement specified in Section 6.1 and the Agreement on the Business Normalization Plans entered into
between KDIC and each Subsidiary, the Implementation Management Agreement under Section 6.1 above shall be interpreted in accordance with WFH’s opinions to the extent that such interpretation is consistent with the purpose of this Agreement as
specified in Article 1 above. 

  

	 	6.4	 	WFH shall immediately report to KDIC of any amendment to the Implementation Management Agreement specified in Section 6.1 or the action plans stated in Section 6.2.4, and without
any objection raised by KDIC in respect thereof, such amendment shall be deemed to replace the relevant provisions of the Implementation Management Agreement. 

  
 Article 7 Reporting on Implementation of the Management Improvement Plans 
  

	 	7.1	 	WFH must submit to KDIC a report on the implementation of the Management Improvement Plans (“Implementation Report”) so that KDIC may inspect the implementation of the
Management Improvement Plans and such report shall include the following matters: 

  

	 	7.1.1	 	Summary of changes in the market conditions during the relevant term; 

	 	7.1.2	 	Overview on the business and financial conditions including financial statements; 

	 	7.1.3	 	Description of the goals to be performed or attained during the relevant term in respect of each plan itemized in the Management Improvement Plan; 

	 	7.1.4	 	Contents and results of performance of each itemized plan as specified in the foregoing Section 7.1.3; 

	 	7.1.5	 	Results of inspection of the performance by each Subsidiary of the action plans specified in Section 6.2.4 and measures taken in respect thereof; 

	 	7.1.6	 	Any issues or problems incurred in the course of fulfilling the Management Improvement Plans during the relevant term; 

	 	7.1.7	 	Any itemized plans resulting in poor performance, the reasons therefor and measures for the remedy thereof; and 

	 	7.1.8	 	Any implementing plans for the immediately following term. 

  

	 	7.2	 	When reporting each of the items specified in the foregoing Section 7.1, WFH shall not impair the accuracy and the integrity of the Implementation Report by adopting any
discretionary accounting methods or any other means. 

  

	 	7.3	 	WFH shall submit to KDIC the Implementation Report under Section 7.1 on a quarterly basis within six (6) weeks from the end of each fiscal quarter. 

  

	 	7.4	 	If KDIC deems it necessary for inspection of the implementation of the Management Improvement Plans, it may request WFH to submit additional materials in addition to the
Implementation Report specified in Section 7.1 and WFH shall not reject KDIC’s request for such additional materials without any special reason. 

  

	 	7.5	 	If KDIC determines that the inspection and measures taken by the WFH is not reasonable after reviewing the matters reported under Section 7.1.5, KDIC may request WFH to remedy such
unreasonable inspection or measures, and in that case, WFH shall comply with such request. 

  
 Article 8 Evaluation by External Experts and Report of Evaluation 
  

	 	8.1	 	KDIC may request WFH to engage any external expert to evaluate all relevant documents including the Management Improvement Plans, Detailed Implementation Plans, Proposed Amendments
to the Management Improvement Plan, Proposed Supplements to the Management Improvement Plans and Implementation Report if KDIC deems it necessary to do so for the performance of the obligations under Articles 3 to 5 and Article 7 hereof, and in that
case, WFH shall not reject such request. 

  

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	 	8.2	 	WFH shall submit to KDIC a report with respect to the results of any evaluations performed by an external expert as described in Section 8.1. 

  
 Article 9 Measures against the Failure of Implementation 
  

	 	9.1	 	In the event where WFH fails to perform any obligations hereunder, KDIC may request WFH to take any of the following measures, and in that case WFH shall take such measures as
requested by KDIC and submit to KDIC a report on the results of such measures taken by it. 

  

	 	9.1.1	 	Any disciplinary actions against an officer or employee of WFH including caution, warning, reprimand, salary cut, suspension in the execution of official duties and dismissal;

	 	9.1.2	 	Any improvement, caution or remedy action against WFH; and 

	 	9.1.3	 	Implementation of the obligations that WFH fails to perform. 

  

	 	9.2	 	The failure to perform any obligations hereunder as specified in Section 9.1 above shall mean any event where, in case the obligations are indicated by a quantitative or numerical
value, WFH fails to accomplish such quantitative or numerical value within a purposed period, and in other cases KDIC otherwise determines that WFH fails to perform any obligations hereunder within a purposed period considering the purposes or
purports of such obligations. 

  

	 	9.3	 	In the event where WFH is unable to attain such financial goals as designated in the form of the financial ratio in the Appendices within a purposed period, it shall not take any
action for the improvement of any employees’ benefit programs, which may require for WFH to bear additional expenses, until such financial goals are fully attained, except for the occurrence of any unavoidable reasons such as any changes in
applicable laws and regulations. 

  

	 	9.4	 	In the event where WFH or its officers or employees delay in making such reports or make a false or fraud statement in such reports as specified in Articles 7, 8 and 11 or refuse,
interrupt, or neglect any performance of its obligations or any requests made by KDIC according to this Agreement including but not limited to the provisions of Article 10 below, KDIC may request WFH to take any measures specified in Section 9.1
above and WFH shall immediately take such measures and submit to KDIC the results of such measures taken by it. 

  
 Article 10 Investigations by KDIC 
  

	 	10.1	 	When KDIC determines that it is necessary to investigate the cause of any delays in performing the obligations of WFH under this Agreement as a result of reviewing the reports or
any other documents submitted by WFH pursuant to Articles 7 and 8, KDIC may have the authority to investigate the business operations and financial conditions and WFH shall make best efforts to provide its full cooperation in such investigation.

  

	 	10.2	 	For the purpose of carrying out the investigations described in the foregoing Section 10.1, KDIC may directly investigate any and all documents, electronic records and officers and
employees of WFH and WFH shall make best efforts to provide its full cooperation in respect thereof and shall provide or support with personnel or expenses necessary for the investigation by KDIC. 

  
 Article 11 Liability for Damages 
  
 KDIC may request WFH to claim for damages against any former or incumbent
officers or employees, any persons who instruct conduct of business under Article 401-2 of the Commercial Code or any other third party who have caused damages to WFH (collectively, the “Responsible Persons”), in KDIC’s opinion, by
his/her negligence or misconduct in the course of performing their duties under the Civil Code, Commercial Code or any other applicable laws and regulations, or to take any actions requiring for such Responsible Persons to take a responsibility for
insolvency of WFH. In this case, WFH shall immediately take such measures requested by KDIC and report to KDIC the proceedings and results thereof. 
  

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 Article 12 Cooperation, etc. in the Recuperation of Public Funds 
  

	 	12.1	 	In order to support KDIC for recuperation of its invested public funds in a timely and profitable manner, WFH shall take any necessary actions including but not limited to profit
dividends on shareholders or cancellation of shares with consideration to the extent such actions do not cause a material adverse effect on the Management Improvement Plans. 

  

	 	12.2	 	WFH shall make best efforts in cooperation with KDIC when KDIC intends to take any actions to liquidate shares held by it including but not limited to the sale or pledge of such
shares. 

  
 Article 13 Effective Period 
  

	 	13.1	 	This Agreement shall become effective from the date on which KDIC and WFH has affixed their respective seals and signatures hereto. 

  

	 	13.2	 	This Agreement shall become null and void at the time when KDIC is no longer the largest shareholder of WFH unless there exists any other special reason. 

 
 Article 14 Miscellaneous 
  

	 	14.1	 	If any term or provision hereof is invalid or unenforceable for any reasons whatsoever, such invalidity or unenforceability does not affect the remaining parts of this Agreement.

  

	 	14.2	 	Any dispute arising out of or in connection with this Agreement or the performance of obligations hereunder shall be submitted to the non-exclusive jurisdiction of the Seoul
District Court to be a court of the first instance. 

  

	 	14.3	 	In the case there exist any discrepancies regarding the interpretation of this Agreement, WFH will respect the interpretation by KDIC to the extent that such is in consistence with
the purpose of this Agreement as set out in Article 1 above. 

  

	 	14.4	 	This Agreement shall not affect any rights reserved by KDIC as a shareholder or creditor, or any rights reserved by it under the Depositor Protection Act and other relevant laws and
regulation. 

  

	 	14.5	 	KDIC may disclose this Agreement through electronic documents or any other means pursuant to Article 17 (3) of the Public Fund Management Special Act. 

  
 Signed as of July 2, 2001 
  

	 Korea Deposit Insurance Corporation
	  	Chief Executive Officer	  	Sang Yong Lee (Signature)
			
	 Woori Finance Holdings Co., Ltd.
	  	Chairman	  	Byung Chul Yoon (Signature)

  
 The undersigned, representative
directors of each Subsidiary, hereby confirm that this Agreement has been entered into by and between the Korea Deposit Insurance Corporation and Woori Finance Holdings Co., Ltd. as above: 
  

	 Hanvit Bank
	  	Chief Executive Officer	  	Duk Hoon Lee (Signature)

  

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	 Peace Bank of Korea
	  	Chief Executive Officer	  	Suk Hee Hwang (Signature)
			
	 Kwangju Bank
	  	Chief Executive Officer	  	Jong Dae Um (Signature)
			
	 Kyongnam Bank
	  	Chief Executive Officer	  	Shin Chul Kang (Signature)
			
	 Hanaro Merchant Bank
	  	Representative Director	  	Jun Ho Lee (Signature)

  
 Appendix I. Implementation of the
Management Improvement Plan for Woori Finance Holdings 
  
 A. Financial
Ratio Targets (Minimum Requirements) 
  

	(%, W100m)
	 	  	2003

	  	2004

	 Items

	  	Jun

	  	Dec

	  	Jun

	  	Dec

	 Capital ratio (%)
	  	105.0	  	105.0	  	105.0	  	110.0
	 Return on total assets (%)
	  	0.6	  	0.8	  	0.9	  	1.0
	 Expense-to-revenue ratio (%)
	  	48.5	  	46.5	  	44.5	  	43.0
	 Operating income per employee
	  	2.9	  	3.0	  	3.5	  	3.6
	 Non-performing loan ratio (%)
	  	2.9	  	2.7	  	2.4	  	2.2
	 Holding company expense ratio (%)
	  	0.9	  	0.9	  	0.9	  	0.9
	 	  	
	  	
	  	
	  	

	
 *       Above figures may be adjusted upon the inclusion of Woori Credit Card and Woori Investment Bank to the Management Improvement Plan considering the impact of such inclusion on financial targets of
WFH.

  
 B. Non-Financial Targets

  

	 Business

	  	 Plan

	  	 Target Date

	Restructuring of banking sector	  	 n     IT integration of Kwangju Bank
and Kyongnam Bank
 •     Integrate IT Center
 •     Kyongnam Bank service integration
 •     Kwangju Bank service integration
	  	 Jan 2003
 Sep 2003
 Sep 2003

	 	  	 n     Integration of credit card services of Kwangju Bank and Kyongnam
Bank
	  	 
	 	  	 •     Conclude the transfer agreement and the completion of transfer of Kwangju Bank’s credit
card operations
	  	Feb 2003
	 	  	 •     Conclude the transfer agreement and the completion of transfer of Kyongnam Bank’s
credit card operations
	  	Jun 2003
	 	  	 n     Standardize operations and share
infrastructure
	  	 
	 	  	 •     Application of business process and guidelines under the model of Woori
Bank
	  	Sep 2003
	 	  	 —  Kyongnam Bank: June 2003
 —  Kwangju Bank: September 2003
	  	 
	 	  	 •     Share advanced infrastructure of Woori Bank linked with IT integration
	  	 From Sep 2003

  

	 Business

	  	 Plan

	  	 Target Date

	Non-banking sector restructuring	  	 •     Establish and implement bancassurance
services
 •     Execute bancassurance agreement with strategic insurance
company
	  	Mar 2003
	  	  
	 	  	 •     Implement necessary infrastructure for bancassurance
services
 —  IT, education, product development, etc.
	  	 Sep 2003

	 	  	 	  	 

  

 6 

	 	  	 •     Increase market presence and competitiveness of Woori
Securities
 •     Expand in-house point of sales presence
	  	 
	 	  	 •     Reinforce marketing through integrating a group-wide CRM (Customer Relationship Management)
structure
	  	 Continuous
 Continuous

	 	  	 •     Consider mergers & acquisitions to increase Woori Securities presence and
operations
	  	 Continuous

	 	  	 •     Restructure and promote operational development of Woori Investment Bank
	  	 
	 	  	 •     Establish and conclude plans to restructure the function of Woori Investment
Bank
	  	 
	 	  	 •     Complete restructuring of Woori Investment Bank
	  	 
	Improve overall system to realize group-wide synergies and competitiveness	  	 •     Promote and expand BPR (Business Process Re-engineering)
	  	 
	  	 •     Complete BPR implementation of Woori
Bank’s branch offices
 •     Establish plans to expand BPR into Kwangju Bank and
Kyongnam Bank
	  	Jun 2003
	  	  	 Jul ~ Dec 2003

	 	  	 •     Implement BPR to Kwangju Bank and Kyongnam Bank
	  	Jan ~ Dec 2004
	 	  	 •     Implement group-wide integrated marketing
	  	 
	 	  	 •     Encourage sharing customer information to support sales efforts
	  	Continuous
	 	  	 •     Implement integrated CRM system
	  	 
	 	  	 —  Banking: build SFA and Mart
	  	 
	 	  	 —  Non-banking: build DW and operating system of Woori Securities and Woori Credit
Card
	  	 Jun 2003
 Dec 2003

	 	  	 •     Expand group-wide marketing system

•     Implement program to monitor results of group-wide marketing system
 •     Promote integrated operations of the Customer Service Center
 —  Promote theintegration of the Customer Service Center as a precursor to the integration of CRM Level
II
	  	 
	 	  	  	 From Jun 2003
 From Jun 2003

	 	  	  	 From Sep 2003

	 	  	  

  

	 Business

	  	 Plan

	  	 Target Date

	Improve overall system to realize group-wide synergies and competitiveness (cont’d)	  	 •     Implement group-wide management of expenses and
personnel
 •     Promote group-wide programs to curtail expenses
 —  Establish plan to build integrated group-wide purchasing system     (Woori Bank, Kyongnam
Bank, Kwangju Bank, Woori F&I,     Woori Credit Card) 
	  	Jun 2003
	 	  	 —  Implement integrated purchasing system
	  	From Jun 2003
	 	  	 •     Manage personnel at the group level
	  	 
	 	  	 —  Establish the plan to use human resources efficiently
	  	Jun 2003
	 	  	 —  Establish and implement the program to develop the group-wide human resources
	  	From Jun 2003
	 	  	 —  Coordinate and monitor compensation for group personnel
	  	Continuous
	 	  	 •     Establish and promote the plan for the efficient operation of expenses and human
resources
	  	Continuous

  

 7 

	 
	 	 	 n
	  	Group-wide risk management system and upgrade its functionality	  	 
	 	 	 	  	 ·   Implement
development and share of the management system for administration of Korea Won denominated securities
	  	Jun 2003
	 	 	 	  	 ·   Build and
share the system of Asset Liability Management (ALM) and market risk management
	  	Sep 2003
	 	 	 	  	 ·   Build and
share the system of credit risk management
	  	Dec 2003
	 	 	 	  	 ·   Construct
the base of group-wide Enterprise-wide Risk Management System (ERMS)
	  	Continuous
	 	 	 	  	 ·   Provide
uniform guidelines on allowance for loan losses (refer to US GAAP and estimation for the allowance by KDIC)
	  	Continuous
	 	 	 	  	 ·   Establish
and inspect the system of the limit management
	  	Continuous
				
	 	 	 n
	  	Construct group-wide management and administration system	  	 
	 	 	 	  	 ·   Build
group-wide financial integration system
	  	Dec 2003
	 	 	 	  	 — Build Korean GAAP reconciliation system
	  	 
	 	 	 	  	 — Build US GAAP valuation and reconciliation system
	  	 
	 	 	 	  	 — Standardization of COA
	  	 
	 	 	 	  	 ·   Build and
improve EIS (Employee Information System) and management & accounting system
	  	Apr’03 ~ Mar’04
	 	 	 	  	 ·   Build the
financial planning system of group and subsidiaries
	  	Jul’03 ~ Jun’04
	 
	Pursuit of efficient 	 	 n
	  	Provide Subsidiaries with management targets and evaluation of results 	  	 
	management of 	 	 	  	 ·   Provide
Subsidiaries with management targets
	  	Mar 2003
	subsidiaries	 	 	  	 ·   Estimate
and monitor the results of management 
	  	Mar ‘03, Mar ‘04
	 	 	 n
	  	Improve management results estimation and compensation standard	  	Continuous
	 	 	 	  	· Improve and develop results estimating and compensation system of managers of
WFH and the Subsidiaries (Implement the plan to encourage Management Compensation Committee)	  	Continuous
	 
	 	 	 	  	 	  	 
	 Business

	 	Plan

	  	Target Date

	Pursuit of efficient management of	 	 n
	  	Consider the program to check up the operations and asset condition of subsidiaries	  	 
	 subsidiaries (cont’d)
	 	 	  	 ·   Build
the executing system to check up the operations of subsidiaries, etc.
	  	Mar 2003
	 	 	 	  	 ·   Implement to check up the operations and asset condition of subsidiaries, etc.
	  	From Mar 2003
	 	 	n	  	Encourage strong activities to prevent financial accidents through supervisory committee	  	 
	 	 	 	  	 ·   Implement special inspection when large-sized financial scandal and moral hazard happen
	  	From Mar 2003
	 
	 Successful
	 	n	  	Promote listing on overseas stock market	  	 
	 Privatization
	 	 	  	 ·   Promote listing American Depositary Shares
	  	Sep 2003
	 
	 
	 	 	 n
	  	Promote to join with strategic investors	  	 
	 	 	 	  	 ·   Attract stable and long-term investors from financial and/or strategic investors
	  	Continuous
				
	 	 	n	  	Promote to dispose of government shares to shareholders’ consortium	  	 
	 	 	 	  	 ·   Organize shareholders’ consortium composed of foreign and domestic investors, and promote to sell the government shares to them by transferring the right of management to leading stockholders
	  	Continuous
	 
	 Miscellaneous
	 	n	  	Consistent improvement and operation of the system adopted by previous management plan	  	Continuous
	 

  

 8Memorandum of Understanding between KDIC and Hanvit Bank

 Exhibit 4.2 
  
 AGREEMENT 
 ON 
 BUSINESS NORMALIZATION PLAN 
  
 This Agreement on the Business Normalization Plan is made and entered into by and between the Korea Deposit Insurance Corporation (“KDIC”), a special entity
established and existing under the Depositor Protection Act to protect depositors and maintain the stability of the financial system, and Hanvit Bank (“Hanvit”), an insurance-covered and insolvent company under the Depositor Protection
Act. KDIC, using the deposit insurance fund which is established, operated and maintained in the manner and procedure pursuant to the Depositor Protection Act, the Public Fund Management Special Act, and other applicable laws and regulations,
intends to invest a total of W 4,642 billion in Hanvit among which W 2,764.4 billion will be invested through capital injection and W 1,877.6 billion through capital contribution in order to restore business normalization, and Hanvit hereby
undertakes to fully implement in good faith the business normalization plan attached hereto as Appendix 1 (“Business Normalization Plan”), which sets forth various matters necessary for its business normalization, including but not limited
to the matters specified in Article 17 Paragraph 2 of the Public Fund Management Special Act. 
  
 Article 1 Purpose 
  

	 	1.1	 	The purpose of this Agreement and the Business Normalization Plan is to set forth the matters necessary in order for KDIC to recuperate the public funds invested by it in a timely
and profitable manner through the business normalization of Hanvit. 

  
 Article 2 Obligations to implement the Business Normalization Plan 
  

	 	2.1	 	Hanvit shall implement in good faith the Business Normalization Plan, and particularly the mandatory implementation plan attached hereto as Appendix 2 (“Mandatory
Implementation Plan”) except for the occurrences of a natural disaster, material national economic crisis or any other events of the force majeure (collectively, the “Event of Force Majeure”). 

  

	 	2.2	 	Hanvit shall obtain and submit to KDIC the Letter of Undertaking in the form designated under this Agreement as attached hereto as Appendix 3, each of which shall be signed by the
incumbent officers as of the effective date of this Agreement and any other officer to be appointed by Hanvit during the term of this Agreement. 

  

	 	2.3	 	The failure to perform any obligations hereunder as specified in Business Normalization Plan and Mandatory Implementation Plan shall mean any event where, in case the obligations
are indicated by a quantitative or numerical value, Hanvit fails to accomplish such quantity or numerical value within an agreed-upon period, and in other cases KDIC otherwise determines that Hanvit fails to perform any obligations hereunder within
an agreed-upon period considering the purposes or purports of such obligations. 

  

	 	2.4	 	Expect for the case where Hanvit fails to perform its obligations to implement the Business Normalization Plan in the Event of Force Majeure as specified in Section 2.1 above,
Hanvit shall not claim that such failure was not caused by or resulted from its willful misconduct or negligence or any other similar reasons attributable to it. Furthermore, Hanvit shall not claim that any problems arising out of the relationship
with the officers or employees, labor unions, creditors, debtors, minor shareholders or any other interested parties of it shall be deemed as of the Events of Force Majeure. 

  
 Article 3 Detailed Implementation Plan for the Business Normalization Plan 
  

	 	3.1	 	 KDIC may request Hanvit to submit a detailed implementation plan relating to the Business Normalization Plan or Mandatory Implementation Plan, and Hanvit shall
submit to KDIC a detailed 

	 	 
implementation plan (“Detailed Implementation Plan”) within two (2) months from the receipt of such requests. 

  

	 	3.2	 	KDIC may request Hanvit to modify the Detailed Implementation Plan if KDIC deems it necessary to do so after the review thereof, and Hanvit shall reflect such modification as
requested by KDIC to the Draft Detailed Implementation Plan. 

  

	 	3.3	 	In case KDIC adopts the Detailed Implementation Plan as submitted and amended in accordance with Section 3.1 and 3.2, the relevant parts of the Business Normalization Plan and
Mandatory Implementation Plan shall be deemed to be amended and replaced as specified in the Detailed Implementation Plan. 

  
 Article 4 Amendments of Business Normalization Plan 
  

	 	4.1	 	In the event where it is deemed that Hanvit is not likely to implement the Business Normalization Plan due to revision of applicable laws and regulations such as criteria for asset
soundness classification, or substantial changes in the external environments such as changes in the market conditions, Hanvit may immediately report to KDIC thereof and subsequently submit to KDIC proposed amendments to the Business Normalization
Plan (“Proposed Amendments to the Business Normalization Plan”). 

  

	 	4.2	 	If KDIC concludes that the Proposed Amendments to the Business Normalization Plan submitted in accordance with Section 4.1 is reasonable after review thereof, KDIC may adopt the
proposed plan. In that case, the relevant parts of the Business Normalization Plan and Mandatory Implementation Plan shall be deemed to be amended and replaced as specified in the Proposed Amendments to the Business Normalization Plan.

  

	 	4.3	 	KDIC may request Hanvit to modify the Proposed Amendments to the Business Normalization Plan submitted by Hanvit under Section 4.1 above, and Hanvit shall reflect such modification
as requested by KDIC to the Proposed Amendments to the Business Normalization Plan. 

  
 Article 5 Supplement to the Business Normalization Plan 
  

	 	5.1	 	Hanvit shall additionally submit to KDIC any new Business Normalization Plan and Mandatory Implementation Plan three (3) months prior to the expiration of the Business Normalization
Plan, unless this Agreement is no longer effective in accordance with Article 12 hereof 

  

	 	5.2	 	KDIC may request Hanvit to modify the Business Normalization Plan and Mandatory Implementation Plan submitted by Hanvit under Section 5.1 above, and Hanvit shall reflect such
modifications as requested by KDIC to the Business Normalization Plan and Mandatory Implementation Plan. 

  
 Article 6 Reporting and Inspection on Implementation of the Business Normalization Plan 
  

	 	6.1	 	Hanvit shall submit to KDIC a report in accordance with Section 6.3 (“Implementation Report”) so that KDIC may inspect the implementation of the Business Normalization
Plan, and such report shall include the followings: 

  

	 	6.1.1	 	Summary of changes in the market conditions during the relevant term; 

	 	6.1.2	 	Overview on the business and financial conditions including financial statements; 

	 	6.1.3	 	Description of the goals to be performed or attained during the relevant term in respect of each plan itemized in the Business Normalization Plan; 

	 	6.1.4	 	Contents and results of performance of each itemized plan as specified in the foregoing Section 6.1.3; 

	 	6.1.5	 	Any issues or problems incurred in the course of fulfilling the Business Normalization Plan during the relevant term; 

  

 2 

	 	6.1.6	 	Any itemized plans resulting in poor performance, the reasons therefor and measures for the remedy thereof; 

	 	6.1.7	 	Self-evaluation on the results of the performance compared to the Business Normalization Plan; and 

	 	6.1.8	 	Any implementing plans for the immediately following term. 

  

	 	6.2	 	In preparing financial statements under Section 6.1.2, Hanvit shall not distort its financial condition through any discretionary accounting treatments such as adjusting the
expected loan loss ratio without clear supporting evidence for repayment feasibility of the debtors. 

  

	 	6.3	 	Hanvit shall submit to KDIC the Implementation Report under Section 6.1 on a quarterly basis by the last day of the month immediately following the relevant fiscal quarter
(including the quarter where this Agreement is executed). 

  

	 	6.4	 	Apart from the periodic Implementation Reports submitted by Hanvit under Section 6.3 above, if KDIC deems it necessary to inspect the implementation of the Business Normalization
Plan, it may request Hanvit to submit materials relevant to the Business Normalization Plan. In such case, Hanvit shall submit to KDIC the requested materials within seven (7) business days, unless there is any special reason.

  
 Article 7 Evaluation by Experts and Report of Evaluation

  

	 	7.1	 	KDIC may request Hanvit to engage any expert with the consultation of KDIC to evaluate all relevant documents including the Business Normalization Plan, Detailed Implementation Plan
for Business Normalization Plan, Proposed Amendments to the Business Normalization Plan, and Implementation Report if KDIC deems it necessary to do so for the performance of the obligation under Articles 3 through 6, and in that case Hanvit shall
not reject such request. 

  

	 	7.2	 	Hanvit shall submit to KDIC a report with respect to the results of any evaluations performed by an expert as described in Section 7.1. 

  
 Article 8 Investigations by KDIC 
  

	 	8.1	 	When KDIC determines that it is necessary to investigate the cause of insolvent operation or any delays in performing the obligations of Hanvit under this Agreement as a result of
reviewing the reports or any other documents submitted by Hanvit pursuant to Articles 6 or 7, KDIC may have the authority to investigate the business operations and financial conditions and Hanvit shall make best efforts to provide its full
cooperation in such investigation. 

  

	 	8.2	 	For the purpose of carrying out the investigations described in Article 10, KDIC may directly investigate any and all documents, electronic records and officers and employees of
Hanvit and Hanvit shall make best efforts to provide its full cooperation in respect thereof and shall provide or support with personnel or expenses necessary for the investigation by KDIC. 

  
 Article 9 Measures against the Failure of Implementation 
  

	 	9.1	 	In the event KDIC deems that Hanvit does not perform fully the Business Normalization Plan including the Mandatory Implementation Plan, KDIC may request Hanvit to take any of the
following measures, and in such case, Hanvit shall immediately take such measures as requested by KDIC and report to KDIC the results of such measures: 

  

	 	9.1.1	 	Any disciplinary actions against an officer or employee of Hanvit, including warnings, reprimands, salary reductions, suspensions in the execution of official duties and dismissals;

	 	9.1.2	 	Require adjustments in capital, or disposal of assets; 

  

 3 

	 	9.1.3	 	Improve or reduce personnel and operation; 

	 	9.1.4	 	Close or integrate branches or organizations, or limit new establishment thereof, or reduce its subsidiaries; 

	 	9.1.5	 	Prohibit acquisition of asset with high default risk or market risk or dispose already purchased assets at risk; 

	 	9.1.6	 	Set restrictions on investment of fixed asset or limit new entry into new business sector or new investment in stocks; 

	 	9.1.7	 	Partial suspension or partial transfer of business; 

	 	9.1.8	 	Prohibit sales of specific finance products; 

	 	9.1.9	 	 Enter into a transaction involving a merger or acquisition or incorporate into a holding company; 

	 	9.1.10	 	Transfer financial transactions such as deposits and loans; and 

	 	9.1.11	 	Other measures similar to Sections 9.1.1 through 9.1.10, which are deemed to be necessary for business normalization of Hanvit and protection of depositors.

  

	 	9.2	 	In the event where Hanvit or its officers or employees delay in making such reports or make a false or fraud statement in such reports as specified in Articles 6 and 7 above, or
refuse, interrupt, or neglect any business or requests made by KDIC according to this Agreement including but not limited to the provisions of Article 8 above, KDIC may request Hanvit to take any disciplinary actions such as dismissal of its
officers or employees, or directly request Hanvit’s officers to resign. In such case Hanvit and its officers shall immediately obey such requests from KDIC. 

  

	 	9.3	 	In the event where Hanvit fails to perform within the relevant period such financial goals as designated in the form of the financial ratio in the Mandatory Implementation Plan, it
shall not take any action for the improvement of any employees’ benefit programs, which may require Hanvit to bear additional expenses, until such financial goals are fully attained, except for the occurrence of any unavoidable reasons such as
any changes in applicable laws and regulations. 

  

	 	9.4	 	In the event Hanvit fails to perform within the relevant period any part of the Business Normalization Plan other than the Mandatory Implementation Plan, KDIC may request Hanvit to
perform thereof within three (3) months. KDIC may request Hanvit to carry out such measures as specified in Section 9.1 if Hanvit fails to perform within the relevant period, and Hanvit shall immediately take such measures as requested by KDIC and
report to KDIC the results of such measures. 

  
 Article 10
Liability for Damages 
  

	 	10.1	 	KDIC may request Hanvit to claim for damages against any former or incumbent officers or employees, any persons who instruct conduct of business under Article 401-2 of the
Commercial Code or any other third party who have caused damages to Hanvit (collectively, the “Responsible Persons” in Section 10.1), in KDIC’s opinion, by his/her negligence or misconduct in the course of performing their duties
under the Civil Code, Commercial Code or any other applicable laws and regulations, or to take any actions requiring for such Responsible Persons to take a responsibility for insolvency of Hanvit. In this case, Hanvit shall immediately take such
measures as requested by KDIC and report to KDIC the proceedings and results thereof. 

  

	 	10.2	 	KDIC may request Hanvit to claim for damages in person or subrogation against any former or current officers or employees of Hanvit’s debtor, an insolvent company, any persons
who instruct conduct of business under Article 401-2 of the Commercial Code, or any other third party who have caused damages to Hanvit or the insolvent company (collectively, the “Responsible Persons” in Section 10.2), in KDIC’s
opinion, by his/her negligence or misconduct in the course of performing their duties under the Civil Code, Commercial Code or any other applicable laws and regulations, or to take any actions requiring for such Responsible Persons to take a
responsibility for insolvency of Hanvit or the insolvent company. In such case, Hanvit shall immediately take such measures as requested by KDIC and report to KDIC on the proceedings and results thereof. 

  

 4 

 Article 11 Recuperation of the Funds, etc. 
  

	 	11.1	 	In order to support KDIC for recuperation of its invested public funds in a timely and profitable manner, Hanvit shall take any necessary actions including but not limited to profit
dividends on shareholders, cancellation of shares with consideration or repayment of claims to the extent such actions do not cause a material adverse effect on the Business Normalization Plan. 

  

	 	11.2	 	Hanvit shall make best efforts in cooperation with KDIC when KDIC intends to take any actions to liquidate shares or claims held by it including but not limited to the sale or
pledge of the shares or claims of Hanvit. 

  
 Article 12
Effective Period 
  

	 	12.1	 	This Agreement shall become effective from the date on which KDIC and Hanvit has affixed their respective seals and signatures hereto. 

  

	 	12.2	 	This Agreement shall become null and void at the time when KDIC is no longer the largest shareholder of Hanvit. However, if Hanvit is incorporated into WFH the Agreement will become
null and void at the time KDIC is no longer the largest shareholder of WFH. 

  
 Article 13 Miscellaneous 
  

	 	13.1	 	This Agreement shall not affect any rights reserved by KDIC as a shareholder or creditor, or any rights reserved by it under the Depositor Protection Act and other relevant laws and
regulation. 

  

	 	13.2	 	If any term or provision hereof is invalid or unenforceable for any reasons whatsoever, such invalidity or unenforceability does not affect the remaining parts of this Agreement.

  

	 	13.3	 	In the case there exist any discrepancies regarding the interpretation of this Agreement, Hanvit will respect the interpretation by KDIC to the extent that such is in consistence
with the purpose of this Agreement as set out in Article 1 above. 

  

	 	13.4	 	Any dispute arising out of or in connection with this Agreement or the performance of obligations hereunder shall be submitted to the non-exclusive jurisdiction of the Seoul
District Court to be a court of the first instance. 

  
 December 30, 2000 
  

	 Korea Deposit Insurance Corporation
	 	            Chief Executive Officer	 	 Sang Yong Lee

			
	 Hanvit Bank
	 	            Chief Executive Officer	 	 Jin Man Kim

	

  
  

 5 

 Appendix I. Supplement Management Normalization Plan for Woori Bank 
  
 A. Financial Ratio Targets (Minimum Requirements) 
  

	(%, W100m)
	 	  	2003

	  	2004

	 Items

	  	Mar

	  	Jun

	  	Sep

	  	Dec

	  	Mar

	  	Jun

	  	Sep

	  	Dec

	 Capital adequacy ratio (%)
	  	10.5	  	10.5	  	10.5	  	10.5	  	10.5	  	10.5	  	10.5	  	10.5
	 Return on total assets (%)
	  	0.9	  	1.0	  	1.0	  	1.0	  	1.0	  	1.0	  	1.0	  	1.1
	 Expense-to-revenue ratio (%)
	  	46.0	  	46.0	  	45.5	  	45.0	  	44.0	  	43.0	  	42.5	  	42.0
	 Operating income per employee
	  	3.0	  	3.1	  	3.1	  	3.2	  	3.5	  	3.6	  	3.6	  	3.7
	 Non-performing loan ratio (%)
	  	2.8	  	2.7	  	2.6	  	2.5	  	2.4	  	2.3	  	2.2	  	2.0
	 Net non-performing loan ratio (%)
	  	1.5	  	1.5	  	1.5	  	1.5	  	1.4	  	1.4	  	1.3	  	1.2
	
	
 *       In the case that total provisioning amounts in 2003 are below expected amounts (W640 bn), the return on total assets may be adjusted to reflect the difference.
 **     In the case that IT-related costs are below expected amounts (W201.2 bn in 2003, W243.8 bn in
2004), the return on total assets and expense-to-revenue ratio may be adjusted to reflect the difference.

  
 B. Other Financial Targets
(Minimum Requirements) 
  

	(W100m)
	 	  	2003

	  	2004

	 Adjusted operating income
	  	32,800	  	38,400

  
 C. Non-Financial Targets

  

	 Business

	  	 Plan

	  	 Target Date

	 Restructuring of
 banking sector
	  	 n       Support
restructuring efforts of Kwangju Bank and Kyongnam Bank
 •     Standardize management
by sector and share infrastructure
	  	Continuous
	 	  	 n       Execute agent fee agreement with Woori Credit
Card
	  	Jun 2003, Mar 2004
	 Other businesses
	  	 n       Continue and improve operation on system set out
from previous Management Normalization Plan
	  	Continuous
	 	  	 n       Set up effective operation plan on manpower and
expenses
	  	Continuous

  
  

 6

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