Regulations on Payment Reserves of Financial Institutions

Enacted December 29, 1977, 37th Monetary Policy Committee Amended February 2, 1978, 3rd Monetary Policy Committee Amended July 19, 1979, 17th Monetary Policy Committee Amended September 6, 1979, 21st Monetary Policy Committee Amended December 28, 1979, 30th Monetary Policy Committee Amended January 12, 1980, 2nd Monetary Policy Committee Amended September 16, 1980, 20th Monetary Policy Committee Amended June 23, 1981, 11th Monetary Policy Committee Amended November 9, 1981, 21st Monetary Policy Committee Amended May 6, 1982, 11th Monetary Policy Committee Amended June 27, 1982, 17th Monetary Policy Committee Amended July 19, 1984, 16th Monetary Policy Committee Amended August 16, 1984, 18th Monetary Policy Committee Amended October 29, 1987, 29th Monetary Policy Committee Amended November 19, 1987, 31st Monetary Policy Committee Amended May 19, 1988, 15th Monetary Policy Committee Amended December 1, 1988, 28th Monetary Policy Committee Amended April 20, 1989, 9th Monetary Policy Committee Amended January 18, 1990, 2nd Monetary Policy Committee Amended January 14, 1991, 2nd Monetary Policy Committee Amended January 17, 1991, 3rd Monetary Policy Committee Amended January 6, 1994, 1st Monetary Policy Committee Amended April 21, 1994, 10th Monetary Policy Committee Amended April 18, 1996, 8th Monetary Policy Committee Amended October 15, 1996, 21st Monetary Policy Committee Amended October 24, 1996, 22nd Monetary Policy Committee Amended February 6, 1997, 3rd Monetary Policy Committee Amended September 18, 1997, 22nd Monetary Policy Committee Amended May 7, 1998, 6th Monetary Policy Committee Amended August 19, 1999, 24th Monetary Policy Committee Amended November 23, 2006, 24th Monetary Policy Committee Amended January 24, 2008, 3rd Monetary Policy Committee Amended December 16, 2011, 28th Monetary Policy Committee Amended February 28, 2013, 4th Monetary Policy Committee Amended August 27, 2026, 16th Monetary Policy Committee

Article 1 (Purpose)

The purpose of these Regulations is to stipulate necessary matters regarding the payment reserves of financial institutions in accordance with Chapter 4, Section 2 of the "Bank of Korea Act" and Article 12-2 of the "Enforcement Decree of the Bank of Korea Act."

Article 2 (Minimum Rate of Payment Reserves)

1. The minimum rate of payment reserves for each type of liability subject to reserve accumulation that each financial institution must hold is as follows:
   1. 0% for long-term housing savings and reformed savings;
   2. 2.0% for time deposits, time savings, mutual insurance funds, housing deposits, and negotiable certificates of deposit;
   3. 7.0% for other deposits.
2. Liabilities arising from negotiable certificates of deposit issued to financial institutions that have an obligation to hold payment reserves at the Bank of Korea are excluded from liabilities subject to payment reserve accumulation.
3. For liabilities designated by the Monetary Policy Committee as subject to payment reserve accumulation in accordance with Article 12-2 of the "Enforcement Decree of the Bank of Korea Act," the Monetary Policy Committee separately determines the minimum rate of payment reserves.

Article 3 (Calculation and Holding of Minimum Payment Reserves)

1. The minimum payment reserve of a financial institution is calculated by applying the corresponding payment reserve rate according to Article 2 to the amount obtained by averaging the daily balance of each type of liability subject to reserve accumulation during the period from the 1st to the last day of each month (hereinafter referred to as the "payment reserve calculation period").
2. A financial institution must maintain an average holding of payment reserves during the period from the second Thursday of the following month to the Wednesday of the second week of the following month (hereinafter referred to as the "payment reserve holding period") that is not less than the minimum payment reserve calculated in accordance with Paragraph 1.

Article 4 (Method of Holding Payment Reserves and Calculation of Holding Amount)

1. A financial institution must hold an amount not less than the minimum payment reserve as a current account deposit at the Bank of Korea. The amount of current account deposits held corresponding to payment reserves is calculated by dividing the sum of the daily current account balances throughout the holding period by the number of days in that holding period.
2. Notwithstanding Paragraph 1, a financial institution may hold up to 35% of the minimum payment reserve in Bank of Korea notes held by that financial institution. In this case, the amount of Bank of Korea notes held by the financial institution recognized as payment reserves is calculated by dividing the sum of the daily balances of Bank of Korea notes held throughout the calculation period by the number of days in that calculation period.
3. The Bank of Korea Governor shall determine the reference time for calculating the daily current account balance according to Paragraph 1.

Article 5 (Report to the Monetary Policy Committee)

The Bank of Korea Governor (hereinafter referred to as the "Governor") shall report the results to the Monetary Policy Committee when imposing an administrative fine on a financial institution that has incurred a deficiency in its minimum payment reserve in accordance with Article 60, Paragraph 1 of the "Bank of Korea Act." However, the report may be omitted if the deficiency in the minimum payment reserve occurred due to a simple calculation error by the financial institution.

Article 6 (Submission of Data)

Financial institutions shall submit necessary data for the implementation of these Regulations as determined by the Governor.

Article 7 (Delegation)

Detailed matters necessary for the implementation of these Regulations shall be determined by the Governor.

Supplementary Provisions <December 29, 1977>

1. These Regulations shall take effect from January 1, 1978.
   However, the minimum deposit payment reserves to be held from January 1, 1978, to January 7, 1978, shall be calculated based on the average of daily deposit balances from January 1, 1978, to January 7, 1978, and the minimum deposit payment reserves to be held from January 8, 1978, to January 22, 1978, shall be calculated based on the average of daily deposit balances from January 1, 1978, to January 15, 1978.
2. Simultaneously with the implementation of these Regulations, the "Minimum Rate of Deposit Payment Reserves for Financial Institutions" (enacted by the 4th Monetary Policy Committee on June 14, 1950) and the "Special Case of Minimum Rate of Deposit Payment Reserves for Workers' Property Formation Savings Deposits" (decided by the Monetary Policy Committee on April 1, 1976) are each repealed.

Supplementary Provisions <February 2, 1978>

These Regulations shall take effect from February 23, 1978 (when accumulating basic reserves for the second half of February). However, during the period from the implementation date of these Regulations to April 22, 1978, the minimum rate of deposit payment reserves to be held by each financial institution is as follows:

Deposit Type	Feb 23, 1978 – Mar 22, 1978	Mar 23, 1978 – Apr 22, 1978
Savings Deposits
Korea Federation of Agricultural Cooperatives and Agricultural Cooperatives	18%	19%
Korea Federation of Fisheries Cooperatives and Fisheries Cooperatives	14%	16%
Demand Deposits
Korea Federation of Agricultural Cooperatives and Agricultural Cooperatives	13%	14%
Korea Federation of Fisheries Cooperatives and Fisheries Cooperatives	25%	26%

Supplementary Provisions <July 19, 1979>

1. These Regulations shall take effect from July 23, 1979 (when accumulating basic reserves for the second half of July).
2. Prior to the implementation of these Regulations, National Savings Association Deposits, Fishermen and Farmers' Deposits, New Life Deposits, Taxpayer Savings Association Deposits, and Public Offering Subscription Savings Deposits, which have already been abolished, shall be subject to the previous regulations until withdrawal.

Supplementary Provisions <September 6, 1979>

1. These Regulations shall take effect from September 7, 1979.
2. Free accumulation deposits contracted prior to the implementation of these Regulations shall continue to be subject to the previous regulations until withdrawal.

Supplementary Provisions <December 28, 1979>

These Regulations shall take effect from January 8, 1980 (when accumulating basic reserves for the first half of January).

Supplementary Provisions <January 12, 1980>

1. These Regulations shall take effect from January 12, 1980. However, the cash holding permission rate shall continue to be subject to the previous regulations until January 22, 1980.
2. Special fixed-term household deposits deposited prior to the implementation of these Regulations shall continue to be subject to the previous regulations until withdrawal.

Supplementary Provisions <September 16, 1980>

These Regulations shall take effect from September 23, 1980 (when accumulating basic reserves for the second half of September).

Supplementary Provisions <June 23, 1981>

These Regulations shall take effect from July 1, 1981 (for July first-half payment reserve target deposits).

Supplementary Provisions <November 9, 1981>

These Regulations shall take effect from November 16, 1981 (for November second-half payment reserve target deposits).

Supplementary Provisions <May 6, 1982>

These Regulations shall take effect from May 23, 1982 (when accumulating basic reserves for the second half of May).

Supplementary Provisions <June 27, 1982>

These Regulations shall take effect from July 26, 1982.

Supplementary Provisions <July 19, 1984>

These Regulations shall take effect from July 23, 1984.

Supplementary Provisions <August 16, 1984>

These Regulations shall take effect from September 8, 1984 (when accumulating basic reserves for the first half of September).

Supplementary Provisions <October 29, 1987>

These Regulations shall take effect from November 23, 1987 (when accumulating basic reserves for the second half of November).

Supplementary Provisions <November 19, 1987>

These Regulations shall take effect from December 1, 1987.

Supplementary Provisions <May 19, 1988>

1. These Regulations shall take effect from June 8, 1988 (when accumulating basic reserves for the first half of June).
2. For housing deposits contracted prior to April 30, 1988 (excluding business housing deposits), the previous regulations shall continue to apply.

Supplementary Provisions <December 21, 1988>

These Regulations shall take effect from December 23, 1988 (when accumulating basic reserves for the second half of December).

Supplementary Provisions <April 20, 1989>

These Regulations shall take effect from May 8, 1989 (when accumulating basic reserves for the first half of May).

Supplementary Provisions <January 18, 1990>

These Regulations shall take effect from February 8, 1990 (when accumulating basic reserves for the first half of February).

Supplementary Provisions <January 14, 1991>

These Regulations shall take effect from January 23, 1991 (when accumulating basic reserves for the second half of January).

Supplementary Provisions <January 17, 1991>

1. These Regulations shall take effect from February 8, 1991 (when accumulating basic reserves for the first half of February).
2. For mutual insurance funds contracted prior to December 31, 1990, the previous regulations shall continue to apply.

Supplementary Provisions <January 6, 1994>

These Regulations shall take effect from January 10, 1994.

Supplementary Provisions <April 21, 1994>

1. These Regulations shall take effect from May 2, 1994.
2. For household preferential time savings contracted prior to May 1, 1994, the previous regulations shall continue to apply.

Supplementary Provisions <April 18, 1996>

1. These Regulations shall take effect from April 23, 1996 (when accumulating required payment reserves for the second half of April).
2. For household preferential time savings contracted prior to May 1, 1994, the minimum rate of payment reserves for time deposits with a maturity of 2 years or more shall apply.

Supplementary Provisions <October 17, 1996>

These Regulations shall take effect from the implementation date of the Enforcement Decree of the Act on Reduction of Taxes and Regulatory Relief, which is amended to introduce household long-term savings.

Supplementary Provisions <October 24, 1996>

These Regulations shall take effect from November 8, 1996 (when accumulating required payment reserves for the first half of November).

Supplementary Provisions <February 6, 1997>

These Regulations shall take effect from February 23, 1997 (when accumulating required payment reserves for the second half of February).

Supplementary Provisions <September 18, 1997>

These Regulations shall take effect from October 1, 1997.

Supplementary Provisions <May 7, 1998>

These Regulations shall take effect from May 23, 1998 (when accumulating required payment reserves for the second half of May).

Supplementary Provisions <August 19, 1999>

These Regulations shall take effect from September 1, 1999.

Supplementary Provisions <November 23, 2006>

These Regulations shall take effect from December 23, 2006 (when accumulating required payment reserves for the second half of December).

Supplementary Provisions <January 24, 2008>

1. (Effective Date) These Regulations shall take effect from March 6, 2008 (when accumulating required payment reserves for the first half of February).
2. (Transitional Measures) The minimum deposit payment reserves calculated based on the average of daily deposit balances from February 16, 2008, to February 29, 2008, shall be held from February 23, 2008, to March 5, 2008.

Supplementary Provisions <December 16, 2011>

These Regulations shall take effect from December 17, 2011. However, Article 3 shall take effect from January 1, 2012 (when calculating the minimum payment reserve for January 2012).

Supplementary Provisions <February 28, 2013>

1. (Effective Date) These Regulations shall take effect from March 1, 2013 (when calculating the minimum payment reserve for March 2013).
2. (Transitional Measures) Workers' property formation savings, workers' long-term savings, workers' housing formation savings, household long-term savings, and workers' preferential savings contracted prior to the implementation date of these Regulations shall be subject to the previous regulations until withdrawal.

Supplementary Provisions <August 27, 2026>

These Regulations shall take effect from a date determined by the Governor within 4 months from the date of decision.
<[Payment and Settlement Innovation Team-218 (2026.9.17, Governor Approval)> Effective from September 21, 2026]