ENFORCEMENT DECREE OF THE ACT ON THE SUPERVISION OF FINANCIAL CONGLOMERATES

Article 1(Purpose) #

The purpose of this Decree is to prescribe matters delegated by the Act on the Supervision of Financial Conglomerates and those necessary for the enforcement thereof.

Article 2(Scope of Finance Company) #

(1) Financial business prescribed by Presidential Decree in subparagraph 1 (a) of Article 2 of the Act on the Supervision of Financial Conglomerates (hereinafter referred to as the "Act") means the business prescribed and publicly notified by the Financial Services Commission from among the financial and insurance businesses under the Minister of Data and Statistics publicly notified by the Commissioner of the Statistics Korea pursuant to Article 22 (1) of the Statistics Act. <Amended on Oct. 1, 2025>

(2) "A company prescribed by Presidential Decree" in subparagraph 1 (b) of Article 2 of the Act means a company prescribed and publicly notified by the Financial Services Commission among the companies engaged in the following business affairs:

1. Provision of computer-related services for conducting financial business;

2. Investigation and research on the financial business or other fields similar thereto;

3. Business affairs similar to those in subparagraphs 1 or 2, as prescribed and publicly notified by the Financial Services Commission.

Article 3(Scope of Affiliated Persons, etc.) #

"Persons in a special relationship prescribed by Presidential Decree" in subparagraph 7 of Article 2 of the Act, with the exception of its items, means persons prescribed and publicly notified by the Financial Services Commission among persons falling under Article 3 (1) or (2) 1 of the Enforcement Decree of the Act on Corporate Governance of Financial Companies.

Article 4(Scope of Finance-Related Statutes) #

"Any finance-related statute or regulation prescribed by Presidential Decree" in subparagraph 8 of Article 2 of the Act means the statutes and regulations prescribed in Article 5 of the Enforcement Decree of the Act on Corporate Governance of Financial Companies.

Article 5(Exclusion from Application) #

(1) Where any of the grounds prescribed by Presidential Decree exists, such as where the practical benefits of applying the relevant provisions are not substantial in consideration of the business affairs, scale, etc. of a financial company in Article 3 (2) of the Act means where any of the following financial companies falls under a financial company prescribed and publicly notified by the Financial Services Commission:

1. A financial company referred to in Article 2 (2);

2. A financial company whose assets, total amount of capital, sales, number of employees, etc. of the financial company are below the standards prescribed and publicly notified by the Financial Services Commission.

(2) Where a representative financial company under Article 7 of the Act (hereinafter referred to as "representative financial company") intends to apply for exclusion from the application of Articles 14 through 16 and 20 of the Act (hereinafter referred to as "exclusion from application") to its affiliated financial companies pursuant to Article 3 (2) of the Act, it shall submit to the Financial Services Commission an application prescribed and publicly notified by the Financial Services Commission, along with documents evidencing that it falls under paragraph (1).

(3) Upon receipt of an application for exclusion from application under paragraph (2), the Financial Services Commission shall notify the representative financial company of the results thereof within one month from the date of receipt of the application.

(4) Detailed matters necessary for the procedures, methods, etc. for exclusion from application under paragraphs (1) through (3) shall be prescribed and publicly notified by the Financial Services Commission.

Article 6(Designation of Financial Conglomerates) #

(1) The Financial Services Commission shall designate a financial conglomerate by no later than July 31 of each year pursuant to Article 5 (1) of the Act: provided, that where urgent or serious grounds exist for the stability of financial markets and risk management between financial companies, etc., the Financial Services Commission may designate the financial conglomerate even after the lapse of the relevant deadline.

(2) "The combined value of the assets calculated as prescribed by Presidential Decree" in Article 5 (1) 2 of the Act means the total assets of domestic financial companies belonging to the same business group based on the statement of financial position as at the end of the immediately preceding business year (where no statement of financial position as at the end of the immediately preceding business year exists, referring to the paid-in capital at the time of incorporation; hereafter the same shall apply in this Article), and "amount prescribed by Presidential Decree" means five trillion won.

(3) "An insolvent financial institution referred to in Article 5 (1) 4 of the Act on the Structural Improvement of the Financial Industry or of a financial company equivalent thereto, prescribed by Presidential Decree" means each of the following financial compenies and "the ratio prescribed by Presidential Decree" shall be 50/100:

1. An insolvent financial institution under the Act on the Structural Improvement of the Financial Industry;

2. An insolvent financial company or an insolvency-threatened financial company under the Depositor Protection Act;

3. A financial company for which a decision has been made to commence rehabilitation proceedings or which such proceedings are pending under the Debtor Rehabilitation and Bankruptcy Act;

4. A financial company which has been declared bankrupt and for which proceedings of bankruptcy are pending under the Debtor Rehabilitation and Bankruptcy Act,

(4) "Cases prescribed by Presidential Decree" in Article 5 (1) 5 of the Act means the following: <Amended on Oct. 21, 2021>

1. Where the total amount of assets of business types other than the business types with the largest total assets (applicable only to domestic financial companies; hereafter the same shall apply in this subparagraph) from among the credit loan depository business, financial investment business, or insurance business is less than the amount prescribed and publicly notified by the Financial Services Commission within the scope of less than five trillion won;

Article 7(Release of Financial Conglomerates from Designation) #

(1) "Cases prescribed by Presidential Decree" in the proviso to Article 6 (1) of the Act means where a financial conglomerate fails to meet the requirements for designation under Article 5 (1) 2 of the Act or Article 6 (4) 1 of this Decree for a period prescribed and publicly notified by the Financial Services Commission within one year and meets the standards for the amount prescribed and publicly notified by the Financial Services Commission during the relevant period.

(2) Where a representative financial company intends to apply for release of a financial conglomerate from designation pursuant to Article 6 (2) of the Act, it shall submit to the Financial Services Commission an application for release from designation prescribed and publicly notified by the Financial Services Commission, along with the following documents:

1. A statement of grounds for releasing the designation of a financial conglomerate;

2. A document substantiating grounds for releasing the designation of a financial conglomerate.

(3) "Data prescribed by Presidential Decree" in Article 6 (3) of the Act means all the data in Article 6 (5).

Article 8(Standards for Selection of Representative Financial Company) #

"Standards prescribed by Presidential Decree" in Article 7 (1) of the Act means the following standards:

1. The size of assets and total capital of the relevant affiliated financial company;

2. The size and frequency of investments in other affiliated financial companies;

3. The degree of influence and control over investments in other affiliated financial companies;

4. Other standards prescribed and publicly notified by the Financial Services Commission as equivalent to those under subparagraphs 1 through 3.

Article 9(Details of Internal Control Polices of Financial Conglomerates) #

(1) Financial conglomerates shall evaluate and check the implementation status of the internal control policy of the financial conglomerate under Article 9 (1) of the Act (hereinafter referred to as "internal control policy of the financial conglomerate") and the operation status of the internal control standards of the financial conglomerate under paragraph (2) of that Article (hereinafter referred to as "internal control guidelines of the financial conglomerate"); Provided, that where urgent or serious circumstances exist for sound internal control, the financial conglomerate may be additionally evaluated and checked.

(2) The standards for the internal control of financial conglomerates shall include the following matters:

1. The procedure and methods to be complied with in performing duties;

2. An organization and human resources exclusively in charge of internal control;

3. Procedures and methods for preventing and managing conflicts of interest;

4. Procedures for handling executive officers and employees who violate the internal control standards of a financial conglomerate;

5. The procedure for establishing or amending the internal control standards of financial conglomerates;

6. Inspection and management of the personnel management of executive officers between affiliated financial companies or between affiliated financial companies and affiliated non-financial companies under Article 9 (1) 4 of the Act;

7. Other matters determined and publicly notified by the Financial Services Commission, which are corresponding to subparagraphs 1 through 6.

(3) Except as otherwise provided for in paragraphs (1) and (2), detailed matters necessary for the evaluation and inspection of internal control policies, etc. for financial conglomerates and the standards for internal control of financial conglomerates shall be prescribed and publicly notified by the Financial Services Commission.

Article 10(Scope of Important Matters concerning Internal Control) #

"Important matters concerning internal control of a financial conglomerate prescribed by Presidential Decree" in Article 10 (1) of the Act means matters concerning internal control policies for financial conglomerates and the results thereof under Article 9 (1).

Article 11(Details of Risk Management Policies of Financial Conglomerates) #

(1) Financial conglomerates shall evaluate and check the implementation status of the risk management policy of the financial conglomerate under Article 11 (1) of the Act (hereinafter referred to as "risk management policy of financial conglomerates") and the operation status of the internal control standards of the financial conglomerate under paragraph (2) of that Article (hereinafter referred to as "risk management standards of financial conglomerates"); provided, where urgent or serious circumstances exist for sound risk management, the financial conglomerate may be additionally evaluated and checked.

(2) The standards for risk management of financial conglomerates shall include the following matters:

1. The procedure and methods for risk management to be complied with in performing duties;

2. An organization and human resources exclusively in charge of risk management;

3. The procedure and methods for the recognition, assessment, monitoring, and control of risks by the financial conglomerate;

4. The procedure and methods for determining risk limits and capital allocation by affiliated financial companies;

5. The procedure and methods for managing risks arising from conflicts of interest;

6. The procedure for handling executive officers and employees who violate the standards for risk management of a financial conglomerate;

7. The procedure for establishing or amending the standards for risk management of financial conglomerates;

8. Other matters determined and publicly notified by the Financial Services Commission as similar to those under subparagraphs 1 through 7.

(3) Except as otherwise provided for in paragraphs (1) and (2), detailed matters necessary for the evaluation and inspection of risk management policies, etc. for financial conglomerates and the standards for risk management of financial conglomerates shall be prescribed and publicly notified by the Financial Services Commission.

Article 12(Scope of Important Matters concerning Risk Management) #

"Important matters concerning risk management of a financial conglomerate prescribed by Presidential Decree" in Article 12 (1) of the Act means matters concerning risk management policies for financial conglomerates and the results thereof under Article 11 (1).

Article 13(Standards for Inspection and Evaluation of Capital Suitability) #

"Detailed standards for checking and assessing the adequacy of capital" in the former part of Article 14 (3) of the Act means that the capital adequacy ratio calculated as prescribed and publicly notified by the Financial Services Commission in consideration of the following matters shall be at least 100 percent:

1. The current status and size of equity capital;

2. The current status and size of redundant capital;

3. The minimum amount of equity capital under the finance-related statutes or regulations;

4. The size of capital required to respond to additional risks.

Article 14(Standards for Internal Transactions Subject to Approval of Board of Directors) #

"Amount set by Presidential Decree" in the former part of Article 15 (2) of the Act means that the amount of a single transaction prescribed and publicly notified by the Financial Services Commission is the smaller of the amount equivalent to 5/10,000 of equity capital or 5 billion won.

Article 15(Scope of Matters Subject to Reporting and Public Disclosure) #

"Matters prescribed by Presidential Decree" in Article 20 of the Act means the following matters:

1. The ownership and governance structure of a financial conglomerate;

2. Internal control and risk management of financial conglomerates;

3. The capital adequacy or financial soundness of the relevant financial conglomerate under Article 14;

4. Internal control and risk concentration of financial conglomerates;

5. Other matters determined and publicly notified by the Financial Services Commission, which are corresponding to subparagraphs 1 through 4.

Article 16(Current Status of Risks of Financial Conglomerates and Evaluation of Actual Conditions of Risk Management Thereof) #

(1) "Matters prescribed by Presidential Decree" in Article 21 (1) 6 of the Act means the following:

1. Appropriateness of policies and standards for internal control of financial conglomerates;

2. Appropriateness of policies and standards for risk management of financial conglomerates;

3. Appropriateness of the ownership and governance structure of a financial conglomerate.

(2) The assessment of the current status of risks and management state of a financial conglomerate under the former part of Article 21 (1) of the Act (hereinafter referred to as "risk management status assessment") shall be conducted every three years. Provided, that the Financial Services Commission may conduct risk management assessment at any time, if deemed urgently necessary in consideration of the size of capital, the current status of risk management, market conditions, etc.

(3) The risk management state assessment shall be conducted by means of a written or on-site survey:

(4) The results of the risk management state assessment shall be evaluated according to the classification of Grades I through V. If the results are appropriate, the results shall be evaluated as Grades I through III, and if the results are insufficient, the results shall be evaluated as Grades IV or V.

(5) The Financial Services Commission may, if deemed necessary for the risk management state assessment, request related institutions, organizations, experts, etc. to submit data or opinions.

(6) Except as provided in paragraphs (1) through (5), details necessary for the procedure and methods for risk management state assessment shall be prescribed and publicly notified by the Financial Services Commission.

Article 17(Submission and Deferment of Management Improvement Plan) #

(1) "Where the results fall short of standards prescribed by Presidential Decree" in Article 22 (1) 1 of the Act means any of the following cases:

1. Where the capital adequacy ratio under Article 13 is less than 100 percent;

2. Where the results of the risk management state assessment conducted under Article 16 (4) are Grade IV or IV.

(2) Where the Financial Services Commission issues an order to submit a management improvement plan under Article 22 (1) of the Act (hereinafter referred to as "management improvement plan"), the Financial Services Commission shall do so in writing, including the following matters. The deadline for submission under subparagraph 2 shall be determined within the limit of 30 to 60 days from the date on which the Financial Services Commission is notified of the order to submit the management improvement plan:

1. Grounds for submission;

2. Deadline for submission;

3. Methods of submission;

4. Other matters prescribed and publicly notified by the Financial Services Commission, which are corresponding to subparagraphs 1 through 3.

(3) Where the Financial Services Commission deems it necessary to issue an order to submit a management improvement plan, it may request the representative financial company to submit relevant data or opinions.

(4) Where a representative financial company submits a management improvement plan pursuant to Article 22 (2) of the Act, it shall attach data evidencing the relevant management improvement plan and related data.

(5) "Matters prescribed by Presidential Decree" in Article 22 (2) 5 of the Act means the following:

1. Improvement of the internal control standards and risk management standards of financial conglomerates;

2. Reduction of redundant use of capital;

3. Reduction of risk bearing;

4. Reduction or restriction on distribution of dividends.

(6) Where the Financial Services Commission defers an order to submit a management improvement plan pursuant to Article 22 (3) of the Act, it shall notify the representative financial company of the grounds therefor and the relevant matters in writing.

Article 18(Measures concerning Non-Submission and Non-Compliance with Management Improvement Plans) #

(1) Where the Financial Services Commission issues an order to take measures under Article 23 (1) of the Act, it shall do so in writing, including the following matters:

1. Measures under Article 23 (1) 1 of the Act: Timing for submission, revision or supplementation of a management improvement plan, and matters revised or supplemented (limited to cases where an order to revise or supplement is issued);

2. Measures under Article 23 (1) 2 of the Act: Matters concerning the period for implementing a management improvement plan, submission of an implementation plan, and reporting on the results of implementation;

3. Measures under Article 23 (1) 3 of the Act: Matters concerning the deadline for taking measures and reporting on the results of taking measures.

(2) Article 17 (3) and (6) shall apply mutatis mutandis to the procedures and methods for deferring measures against failure to submit or failure to comply with a management improvement plan under Article 23 (2) of the Act.

(3) Except as provided in paragraphs (1) and (2), details necessary for a failure to submit, implement, etc., a management improvement plan shall be prescribed and publicly notified by the Financial Services Commission.

Article 19(Administrative Disposition) #

"Grounds prescribed by Presidential Decree, such as where the relevant person takes reasonable precautions to fulfill his or her obligations", in Article 25 (2) of the Act means any of the following cases:

1. Where it is deemed that the relevant person has taken reasonable precautions to fulfill his or her obligations;

2. Where the relevant person explains the grounds that makes it impracticable to perform his or her obligations and it is deemed that there is a substantial ground for such grounds;

3. Where there is no intentional or gross negligence on the part of the relevant person and it is deemed that there are sufficient circumstances in which it is difficult to hold him or her responsible for the violation.

Article 20(Considerations in Examination for Authorization and Permission) #

"Requirements prescribed by Presidential Decree" in the provisions, with the exception of the subparagraphs, of Article 28 of the Act means cases where the capital adequacy ratio under Article 13 falls under at least the ratio prescribed and publicly notified by the Financial Services Commission within the range of at least 100 percent.

Article 21(Provision and Management of Customer Information) #

(1) "Matters prescribed by Presidential Decree, such as internal control and risk management of a financial conglomerate" in the part, with the exception of the subparagraphs, of Article 29 (1) of the Act means the following:

1. Formulation, operation, evaluation and inspection of policies and standards for internal control of financial conglomerates;

2. Formulation, operation, evaluation and inspection of policies and standards for risk management of financial conglomerates;

3. Evaluation and inspection of capital adequacy under Article 14 (2) of the Act.

(2) "Matters prescribed by Presidential Decree" in Article 29 (1) 6 of the Act means the following:

1. Methods and authority to access information (hereafter referred to as "information to be provided" in this Article) provided by an affiliated financial company to another affiliated financial company pursuant to Article 29 (1) of the Act, with the exception of its subparagraphs, of the Act;

2. Inspection of the current status of use of the information provided;

3. Measures to cope with the leakage of the provided information.

(3) "Matters prescribed by Presidential Decree, such as internal control and risk management of a financial conglomerate" in the part, with the exception of the subparagraphs, of Article 29 (2) of the Act means the matters in the subparagraphs of paragraph (1):

(4) Where an affiliated financial company notifies the relevant customer of the details of provision of customer information (referring to financial transaction information, personal credit information, total amount of securities information, etc. under Article 29 (3) of the Act; hereinafter the same shall apply) pursuant to the main clause of Article 29 (4) of the Act, it shall comply with the following standards:

1. Types of information required to be notified: Financial transaction information, personal credit information, total amount of securities, etc. under Article 29 (3) of the Act;

2. Matters subject to notification: the following items:

(a) A recipient;

(b) The purpose of provision;

(c) The frequency of provision;

(d) Details of customer information provided;

Article 22(Joint Use of Facilities) #

(1) "Matters prescribed by Presidential Decree, such as internal control and risk management of a financial conglomerate" in Article 30 of the Act means the following:

1. Formulation, operation, evaluation and inspection of policies and standards for internal control of financial conglomerates;

2. Formulation, operation, evaluation and inspection of policies and standards for risk management of financial conglomerates;

3. Functions relating to the management of soundness for the financial conglomerate under Articles 13 through 16;

4. Reporting and disclosure pursuant to Article 20 of the Act;

5. Submission of a plan for improving the overall management under Article 22 of the Act.

(2) "Facilities, etc. prescribed by Presidential Decree" in Article 30 of the Act means the following facilities, etc.:

1. Telecommunications equipment defined in subparagraph 2 of Article 2 of the Telecommunications Business Act;

2. Electronic equipment under subparagraph 8 of Article 2 of the Electronic Financial Transactions Act;

3. Apparatus for storing electronic data;

4. Office devices and goods.

Article 23(Entrustment of Business Affairs) #

(1) Pursuant to Article 31 of the Act, the Financial Services Commission shall entrust the following business affairs to the Governor of the Financial Supervisory Service:

1. Receipt of applications for exclusion from application by a representative financial company and review of exclusion from application under Article 3 (2) of the Act;

2. Review of requirements for designation of financial conglomerates under Article 5 (1) of the Act and request for submission of data under paragraph (2) of that Article;

3. Review of requirements for release of financial conglomerates from designation under Article 6 (1) of the Act and request for submission of data under paragraph (3) of that Article;

4. Review of selection of representative financial companies under the former part of Article 7 (2) of the Act and receipt of reports under paragraph (4) of that Article;

5. Review of an assessment of the adequacy of the capital under Article 14 (4) of the Act;

6. Receipt of reports under Article 20 of the Act;

7. An assessment of risk management status under Article 21 (1) of the Act;

8. The following affairs under Article 22 of the Act:

(a) Review of whether it falls under any subparagraph of Article 22 (1) of the Act;

(b) Receipt and review of management improvement plans under Article 22 (2) of the Act;

(c) Request for submission of data and opinions under Article 17 (3);

(d) Notification to a representative financial company under Article 17 (6).

9. The following affairs under Article 23 (1) of the Act:

(a) Review of requirements for issuing orders to take measures under Article 23 (1) of the Act;

(b) Request for submission of data and opinions under Article 17 (3) which shall apply mutatis mutandis pursuant to Article 18 (2);

(c) Notification to a representative financial company under Article 17 (6) which shall apply mutatis mutandis pursuant to Article 18 (2).

10. The following business affairs under Article 25 of the Act (limited to financial companies and their executive officers and/or employees prescribed and publicly notified by the Financial Services Commission):

Article 24(Criteria for Imposition of Administrative Fines) #

(1) The criteria for the imposition of an administrative fine under Article 34 (1) of the Act shall be as specified in attached Table.

(2) "Grounds prescribed by Presidential Decree, such as where the relevant person takes reasonable precautions to fulfill his or her obligations", in Article 34 (2) of the Act means any ground falling under any subparagraph of Article 19: