Rules for the Operation and Management of the Payment and Settlement System

Established: December 31, 2001. Governor Approval Geongyeol 5011-610 Amended: February 21, 2002. Governor Approval Geongwan 5011-38 Amended: July 22, 2002. Governor Approval Geongyeol 5011-350 Amended: September 25, 2002. Governor Approval Geongyeol 5011-471 Amended: June 24, 2003. Governor Approval Geongwan 5011-117 Amended: October 10, 2003. Governor Approval Geongyeol 5011-424 Amended: December 26, 2003. Governor Approval Geongyeol 5011-573 Amended: June 24, 2004. Governor Approval Geongyeol 5011-328 Amended: September 24, 2004. Governor Approval Geongyeol 5011-532 Amended: March 14, 2005. Governor Approval Geongyeol 5011-117 Amended: September 1, 2005. Governor Approval Geongyeol 5011-557 Amended: August 24, 2006. Governor Approval Payment Stability Team-119 Amended: December 20, 2006. Governor Approval Payment Operation Team-671 Amended: March 9, 2007. Governor Approval Payment Operation Team-137 Amended: October 16, 2007. Governor Approval Payment Operation Team-541 Amended: December 14, 2007. Governor Approval Payment Policy Team-1244 Amended: January 25, 2008. Governor Approval Payment Policy Team-86 Amended: July 9, 2008. Governor Approval Payment Operation Team-365 Amended: October 9, 2008. Governor Approval Payment Operation Team-609 Amended: January 22, 2009. Governor Approval Payment Policy Team-77 Amended: March 26, 2009. Governor Approval Payment Operation Team-161 Amended: April 3, 2009. Governor Approval Payment Policy Team-342 Amended: May 25, 2009. Governor Approval Payment Operation Team-280 Amended: December 16, 2009. Governor Approval Payment Operation Team-885 Amended: January 26, 2010. Governor Approval Payment Policy Team-110 Amended: November 4, 2010. Governor Approval Payment Operation Team-600 Amended: December 23, 2010. Governor Approval Payment Operation Team-743 Amended: February 22, 2011. Governor Approval Payment Operation Team-114 Amended: November 18, 2011. Governor Approval Payment Policy Team-1355 Amended: February 3, 2012. Governor Approval Payment Policy Team-133 Amended: December 27, 2012. Governor Approval Payment Policy Team-1777 Amended: July 11, 2013. Governor Approval Payment Policy Team-373 Amended: March 27, 2014. Governor Approval Payment Policy Team-83 Amended: November 26, 2015. Governor Approval Payment Policy Team-600 Amended: February 25, 2016. Governor Approval Payment Policy Team-119 Amended: November 24, 2016. Governor Approval Payment Policy Team-598 Amended: December 7, 2017. Governor Approval Payment Policy Team-602 Amended: December 20, 2018. Governor Approval Payment Policy Team-576 Amended: April 9, 2020. Governor Approval Payment Policy Team-202 Amended: June 25, 2020. Governor Approval Payment Policy Team-393 Amended: September 10, 2020. Governor Approval Payment Policy Team-617 Amended: March 25, 2022. Governor
Approval Payment Operation Team-195 Amended: October 27, 2022. Governor Approval Payment Policy Team-685 Amended: January 16, 2023. Governor Approval Payment Policy Team-53 Amended: February 8, 2023. Governor Approval Payment Policy Team-131 Amended: April 11, 2023. Governor Approval Payment Policy Team-334 Amended: July 27, 2023. Governor Approval Payment Policy Team-699 Amended: August 25, 2023. Governor Approval Payment Policy Team-769 Amended: March 29, 2024. Governor Approval Payment Stability Team-110 Amended: June 13, 2024. Governor Approval Payment Policy Team-496 Amended: June 5, 2025. Governor Approval Payment Policy Team-428 Amended: March 25, 2026. Governor Approval Payment Operation Team-189 Amended: August 27, 2026. Governor Approval Payment and Settlement Innovation Team-190

Chapter 1 General Provisions

Article 1 (Purpose)

The purpose of these Rules is to define detailed matters delegated by the "Rules for the Operation and Management of the Payment and Settlement System" (hereinafter referred to as the "Rules") and the "Open Market Operation Rules" (hereinafter referred to as the "Market Rules") and necessary details for their implementation.

Article 2 (Definitions)

The terms used in these Rules are defined as follows:

1. "Remitting Institution" refers to a BOKFN participating institution that requests a fund transfer to the Bank of Korea through a current deposit account (in the case of foreign currency fund transfers, a foreign currency deposit account; hereinafter referred to as "Current Deposit Account") opened with the Bank of Korea using the Bank of Korea Financial Network (hereinafter referred to as "BOKFN").
2. "Receiving Institution" refers to a BOKFN participating institution that receives the remitting institution's fund transfer funds.
3. "Beneficiary" refers to the person designated by the remitting institution to receive the fund transfer funds through the receiving institution.

Article 3 (Consultation)

The Bank of Korea must solicit opinions from relevant institutions in advance when establishing or changing major policies related to the payment and settlement system. However, exceptions may be made in urgent cases or when prior disclosure of relevant content is deemed inappropriate.

Chapter 2 Operation of the Payment and Settlement System

Section 1 BOKFN Participation and Operational Standards

Article 4 (BOKFN Membership Criteria and Net Settlement Participation Criteria)

① The BOKFN membership criteria under Article 6, Paragraph 2 of the Rules are as follows:

1. An institution wishing to join the BOKFN must have concluded a current deposit transaction agreement with the Bank of Korea and meet the criteria defined in <Table 5>.
2. For institutions where BOKFN use is unavoidable in relation to Bank of Korea operations, payment and settlement system operations, fund intermediation, bank common network participation, securities settlement, etc., the Bank of Korea may allow membership without applying the criteria in <Table 5> Item 2, after hearing the opinions of the relevant Bank of Korea departments. However, if an institution joined the BOKFN due to Bank of Korea operational needs, it must immediately apply the criteria in <Table 5> Item 2 after that need ceases.
3. For institutions where the Director of the Financial Payment Department (hereinafter referred to as the "Director of the Financial Payment Department") recognizes that it is difficult to meet the criteria in <Table 5> Item 4, the Bank of Korea may allow membership without applying said criteria.

② The net settlement participation criteria under Article 6, Paragraph 4, Item 4 of the Rules are as follows:

1. Based on the end of the quarter immediately preceding the application date (or the closest quarter end if data for the immediately preceding quarter is unavailable), the total capital ratio under the "Banking Supervision Rules" (for newly established institutions, the expected ratio at the end of the fiscal year in which the net settlement participation application date falls) must meet the management guidance ratio defined in the same Rules.
2. Based on the month immediately preceding the application date (or the closest month if data for the immediately preceding month is unavailable), the liquidity coverage ratio under the "Banking Supervision Rules" (for newly established institutions, the expected ratio for the last month of the fiscal year in which the net settlement participation application date falls) must meet the management guidance ratio defined in the same Rules.
3. The institution must possess the ability to manage risks associated with net settlement as determined by the Director of the Financial Payment Department.

Article 5 (Joining and Withdrawal)

① An institution wishing to join the BOKFN must submit a membership application form and a BOKFN membership agreement, as defined by the Director of the Financial Payment Department, to the Bank of Korea.
② Upon receiving the membership application form under Paragraph 1, the Director of the Financial Payment Department shall evaluate whether the membership criteria under Article 4, Paragraph 1 are met and decide on approval. The Director of the Financial Payment Department shall re-evaluate the membership criteria compliance six months after the BOKFN membership date for institutions approved for membership, and may terminate the membership agreement if the criteria are not met. ③ Among institutions that have joined the BOKFN under Paragraph 2 (hereinafter referred to as "Participating Institutions"), those wishing to participate in net settlement under Article 5, Paragraph 1, Item 2 of the Rules must submit a participation application form and a net settlement agreement, as defined by the Director of the Financial Payment Department, to the Bank of Korea. ④ Upon receiving the participation application form under Paragraph 3, the Director of the Financial Payment Department shall evaluate whether the requirements under Article 6, Paragraph 4 of the Rules and the participation criteria under Article 4, Paragraph 2 are met, and decide on participation approval. ⑤ When a Participating Institution wishes to withdraw from the BOKFN or net settlement, it must submit a withdrawal application form, as defined by the Director of the Financial Payment Department, to the Bank of Korea. ⑥ Institutions whose membership agreements were terminated under Paragraph 2, Article 6, or Article 91, Paragraph 2, or institutions that withdrew under Paragraph 5, may apply for re-membership in the BOKFN after three years have passed from the date of agreement termination or withdrawal. However, exceptions may be made if necessary for the Bank of Korea's operations or if BOKFN use is unavoidable due to reasons such as mergers. ⑦ Institutions not joined to the BOKFN may use the BOKFN through Participating Institutions.

Article 6 (Post-Membership Management of Participating Institutions, etc.)

① The Director of the Financial Payment Department shall re-examine annually whether Participating Institutions meet the membership criteria under Article 4, Paragraph 1. If an institution fails to meet these criteria, the Director may take the following actions based on the number of times the criteria were not met in the past five years:

1. 1-2 failures: Request measures to meet membership criteria and notify the CEO and Auditor.
2. 3 failures: Recommend withdrawal from the BOKFN.
3. 4 failures: Terminate the BOKFN membership agreement.

② The Director of the Financial Payment Department shall re-examine annually whether institutions participating in net settlement under Article 5, Paragraph 4 (hereinafter referred to as "Net Settlement Participating Institutions") meet the net settlement participation criteria under Article 4, Paragraph 2. If an institution fails to meet these criteria, the Director may take necessary measures such as requesting measures to meet the criteria, recommending withdrawal from net settlement, or terminating relevant agreements.

Article 7 (Use of Payment and Settlement Systems via BOKFN)

① A payment and settlement system operator wishing to use the BOKFN must submit a usage application form, materials necessary for the evaluation under Article 7, Paragraph 1 of the Rules, and an agreement, as defined by the Director of the Financial Payment Department, to the Bank of Korea. ② Upon receiving an application under Paragraph 1, the Director of the Financial Payment Department shall decide on approval considering the results of evaluating the safety and efficiency of the payment and settlement system according to the evaluation criteria defined in Article 37 of the Rules, and the impact such use would have on the operation of the BOKFN if the system performs final settlement via the BOKFN. ③ A payment and settlement system operator allowed to use the BOKFN under Paragraph 2 (hereinafter referred to as "User Institution") wishing to terminate the use of the BOKFN for its payment and settlement system must submit a usage termination application form, as defined by the Director of the Financial Payment Department, to the Bank of Korea.

Article 7-2 (Connection of Call Transaction Intermediation System to BOKFN)

① An institution wishing to connect its call transaction intermediation system to the BOKFN under Article 16-2, Paragraph 3 of the Rules must submit an agreement, as defined by the Director of the Financial Payment Department, to the Bank of Korea.
② The agreement under Paragraph 1 must include operational standards and contingency measures for the call transaction intermediation system resulting from the connection to the BOKFN, to ensure stable operation of the BOKFN.

Article 8 (Registered Matters of Participating Institutions and User Institutions)

① Participating Institutions and User Institutions must register the following matters with the Bank of Korea in advance:

1. Authorized senders
2. Dedicated terminals and communication lines (including disaster recovery communication lines; hereinafter the same)
3. Other matters deemed necessary

② Matters under Item 1 of Paragraph 1 shall be defined by the Director of the Financial Payment Department, and matters under Items 2 and 3 shall be defined by the Director of the IT Strategy Department of the Bank of Korea (hereinafter referred to as the "Director of the IT Strategy Department").

Article 9 (Cost Burden)

① The BOKFN usage fee borne by Participating Institutions under Article 9 of the Rules is as defined in <Table 1>.
② Communication line usage fees associated with connection to the BOKFN shall be borne by Participating Institutions and User Institutions. However, if a User Institution or a payment and settlement system operator connected to the BOKFN under Article 16 of the Rules connects to the BOKFN due to Bank of Korea needs, the Bank of Korea may bear the communication line usage fee. ③ If a Participating Institution connects to a computer network other than the BOKFN to handle BOKFN business under Article 5 of the Rules, the communication line usage fee for that network may be shared between the Bank of Korea and the Participating Institution according to standards defined by the Director of the Financial Payment Department. ④ Participating Institutions and User Institutions must install equipment necessary for connection to the BOKFN at their own expense. ⑤ The Bank of Korea shall bear the maintenance costs for the communication lines under Paragraph 2. ⑥ Notwithstanding Paragraphs 1 through 4, the BOKFN usage fee, ancillary costs, and methods of receiving such costs borne by CLS Bank International shall be separately defined in the BOKFN usage agreement concluded between the Bank of Korea and CLS Bank.

Article 10 (Understanding of Fund Settlement Status)

The Director of the Financial Payment Department must constantly understand the fund settlement status of Participating Institutions and take necessary measures to ensure smooth fund settlement.

Article 11 (Business Continuity Measures)

The BOKFN business continuity measures under Article 14, Paragraph 1 of the Rules must include the following:

1. Response procedures for each situation
2. Establishment and operation of emergency response organizations
3. Conditions and procedures for input agency, manual operations, etc.
4. Implementation of simulation drills
5. Establishment of emergency contact systems with Participating Institutions and User Institutions
6. Scope and procedures for reporting and external notifications

Article 12 (Measures in Case of Disasters, etc.)

① Participating Institutions and User Institutions must immediately notify the Bank of Korea upon discovering a disaster or signs of a disaster in the BOKFN or their own computer systems connected to the BOKFN, and perform business according to the processing procedures defined in the BOKFN business continuity measures under Article 11. ② The head of the relevant Bank of Korea department may restrict an institution's use of the BOKFN after notifying the relevant institution in advance if there is a possibility that stable operation of the BOKFN will be hindered due to computer system disasters, natural disasters, strikes, terrorism, business suspension, etc., of a Participating Institution or User Institution, or if security requires it. ③ The head of the relevant Bank of Korea department who took the measures under Paragraph 2 must immediately notify the Director of the Financial Payment Department.

Article 13 (Operating Hours)

① The start and end times for the input of messages for fund transfers by Participating Institutions via the BOKFN shall be 9:00 AM and 8:00 PM, respectively. However, the end time for input of messages for fund transfers by payment centers of Participating Institutions under the jurisdiction of Bank of Korea regional headquarters shall be 5:00 PM. ② Notwithstanding Paragraph 1, the end times for input of messages for the following fund transfer applications are as follows:

1. Repayment of intraday current account loans: 8:20 PM
2. Deposit/withdrawal of fund adjustment deposits: 8:30 PM
3. Fund transfers where CLS Bank is the remitting or receiving institution (hereinafter "CLS Settlement"): 5:30 PM. However, during the winter season (from the last Sunday of October to the last Sunday of the following year), it shall be 6:30 PM.
4. Deposit of government bond issuance funds: 3:50 PM
5. Application for temporary payment shortfall funds: 4:00 PM
6. Repayment of temporary payment shortfall funds: 7:35 PM
7. Application for securities and funds simultaneous settlement for repayment of short-term treasury bills: 2:20 PM
8. Application for fund transfers with designated beneficiaries: 7:50 PM
9. Application for current deposit carry-over for treasury payments: 4:00 PM
10. Application for linked settlement between the BOKFN and the Electronic Financial Common Network (hereinafter "Linked Settlement"): 7:50 PM
11. Application for fund transfers for securities and funds simultaneous settlement: 7:50 PM
12. Application for fund transfers for securities and funds simultaneous settlement resulting from repurchase agreement transactions outside the securities market (including applications for fund transfers for settlement of securities repurchase agreement transactions with the Bank of Korea): 5:20 PM
13. Application for foreign currency fund transfers: 5:30 PM
14. Applications for fund transfers between general current deposit accounts and foreign currency international current deposit accounts, or between payment-specific current deposit accounts and foreign currency international current deposit accounts, made on the last business day of the reserve holding period under Article 3 of the "Financial Institutions Reserve Rules": 7:30 PM

③ The start and end times for the input of messages for the issuance and repayment of Bank of Korea Currency Stabilization Securities (hereinafter "Currency Stabilization Securities"), trading of government and local government bonds, and issuance and repayment of government bonds by Participating Institutions via the BOKFN shall be 9:00 AM and 5:30 PM, respectively.

④ The Director of the Financial Payment Department may temporarily change the times under Paragraphs 1 and 2 in any of the following cases, and may restrict the scope of Participating Institutions and target businesses during the changed times. In this case, the Director of the Financial Payment Department must immediately notify the Director of the Financial Business Department of the Bank of Korea (hereinafter referred to as the "Director of the Financial Business Department"). However, in the case of the proviso to Paragraph 1, the head of the Bank of Korea regional headquarters with jurisdiction may decide on the change of the message input end time, and in the case of Paragraph 2, Items 4 or 9, the Director of the Financial Business Department may decide on the change, provided that it does not exceed 5:30 PM.

1. Disaster in the BOKFN
2. When necessary for the Bank of Korea to perform monetary and credit policies
3. When large-scale or multiple fund settlements are delayed due to computer disasters of Participating Institutions or tight interbank funds, and significant confusion in the financial market is expected
4. Other unavoidable cases

⑤ If the operating hours of the BOKFN are extended due to the cause under Paragraph 4, Item 3, the relevant Participating Institution must submit the cause of occurrence, processing results, and countermeasures to prevent recurrence to the Director of the Financial Payment Department.

⑥ The usage hours of the BOKFN for inquiries regarding current deposit balances of Participating Institutions with the Bank of Korea and for transmitting/receiving data related to Bank of Korea loans among the businesses under Article 5, Paragraph 2 of the Rules shall be determined by the head of the relevant Bank of Korea department in consultation with the Director of the IT Strategy Department, and notified to the Director of the Financial Payment Department.

Article 14 (Participating Institutions Council)

① The Bank of Korea may operate a council composed of relevant persons in charge of Participating Institutions and User Institutions to efficiently operate the BOKFN.
② Specific matters regarding the composition and operation of the council under Paragraph 1 shall be determined by the Director of the Financial Payment Department in consultation with the Director of the IT Strategy Department.

Article 14-2 (Provision of Data to Participating Institutions)

The Bank of Korea may provide Participating Institutions with payment-related data regarding the institutions to facilitate efficient payment liquidity management.

Article 15 (Business Development Using BOKFN)

The head of a Bank of Korea department wishing to perform business using the BOKFN must request the Director of the IT Strategy Department to develop or change the computer system, with the consent of the Director of the Financial Payment Department. In this case, the requesting department head must specify the institutions that can use the relevant business.

Section 2 Target Businesses Processed by Current Deposit Account

Article 16 (Classification of Target Businesses by Current Deposit Account)

① When the Bank of Korea handles businesses under Article 5, Paragraph 1 of the Rules via the BOKFN, it processes them through the Participating Institution's current deposit account.
② The Bank of Korea classifies the Participating Institution's current deposit account into a general current deposit account and a payment-specific current deposit account under Article 5-2 of the Rules and processes businesses accordingly.
③ Among the businesses under Paragraph 1, the following businesses are processed through the Participating Institution's payment-specific current deposit account:

1. CLS Settlement
2. Net Settlement
3. General fund transfers between Participating Institutions
4. Call fund transfers
5. Fund transfers with designated beneficiaries
6. Settlement of repurchase agreement transaction funds for securities with the Bank of Korea
7. Securities and funds simultaneous settlement
8. Settlement of securities trading funds between the Bank of Korea's securities custody business and User Institutions
9. Linked Settlement
10. Support and repayment of temporary payment shortfall funds. However, for the Korea Exchange, this business is processed through the payment-specific current deposit account of the Korea Depository & Clearing (KSDC) upon separate application.

④ Among the businesses under Paragraph 1, businesses other than those listed in Paragraph 3 are processed through the Participating Institution's general current deposit account.

Article 17 (Fund Transfers Between Current Deposit Accounts)

① Participating Institutions may request the Bank of Korea for fund transfers between their own general current deposit accounts, payment-specific current deposit accounts, and foreign currency international current deposit accounts. In this case, waiting due to insufficient deposit balances is not permitted. ② Fund transfers to other Participating Institutions may only be requested between current deposit accounts of the same type. ③ The Bank of Korea may transfer balances between a Participating Institution's general current deposit account and payment-specific current deposit account after the end time for message input under Article 13, Paragraph 2, Item 6, if necessary for the repayment of intraday current account loans and temporary payment shortfall funds.

Section 3 Fund Transfers via General Current Deposit Accounts

Subsection 1 General Fund Transfers

Article 18 (Application for Fund Transfers)

① Participating Institutions may request the Bank of Korea for fund transfers under Article 16, Paragraph 4, limited to transactions for which settlement occurs on that day. However, this does not apply to foreign currency deposits with the Bank of Korea by Participating Institutions under Article 5, Paragraph 1, Item 3 of the Rules. ② Participating Institutions may request reserved fund transfers to transfer funds from their general current deposit accounts to their payment-specific current deposit accounts at the time of net settlement, within the time defined by the Director of the Financial Payment Department.

Article 19 (Waiting for Fund Transfer Applications)

① When processing fund transfer applications, if the remitting institution's general current deposit balance is insufficient, the Bank of Korea shall record the application in a waiting file and process it sequentially according to the first-in-first-out principle when the shortfall is filled. However, if a large fund transfer application waiting with higher priority causes a fund transfer application waiting with lower priority that could be settled to remain unsettled, the Bank of Korea may process the lower priority waiting application first according to the first-in-first-out principle. ② Notwithstanding Paragraph 1, the Bank of Korea may temporarily suspend the processing of fund transfer applications from the time net settlement data is input until net settlement is completed, to ensure smooth completion of net settlement between Participating Institutions. ③ If a remitting institution does not fill the shortfall by the message input end time under Article 13, Paragraphs 1 and 2, the Bank of Korea may choose not to process the fund transfer application of that institution in the waiting state.

Article 20 (Cancellation of Fund Transfer Applications)

① A remitting institution cannot cancel a fund transfer application once it has been received by the Bank of Korea. However, this does not apply if the application is in a waiting state due to insufficient general current deposit balance.
② If a reserved fund transfer application by a remitting institution is not processed at the time of net settlement, the Bank of Korea may cancel it immediately.

Article 21 (Return of Erroneously Transferred Funds)

If funds are transferred to the general current deposit account of a Participating Institution other than the legitimate receiving institution due to an error by the remitting institution, the Participating Institution that received the funds must immediately conduct a reverse transaction to restore the original state.

Subsection 2 Settlement of Funds for Government Bonds, etc.

Article 22 (Method of Settlement)

① The Bank of Korea withdraws the purchase price from the general current deposit account of the Participating Institution acquiring Currency Stabilization Securities or government/local government bonds and registers the securities or delivers them in physical form to that institution. ② When a Participating Institution requests the transfer of registered Currency Stabilization Securities or government/local government bonds, the Bank of Korea settles the price by offsetting it between the general current deposit accounts of the transferee and transferor. However, this does not apply if the transfer requestor requests only the registration of name change for the securities. ③ The Bank of Korea deposits the redemption and repayment prices for registered Currency Stabilization Securities or government/local government bonds into the general current deposit account of the Participating Institution upon request. ④ The Bank of Korea settles the repurchase agreement transaction funds between Participating Institutions and the Bank of Korea, and the securities trading funds between Participating Institutions and User Institutions of the Bank of Korea's securities custody business, through the payment-specific current deposit account of the relevant institution. In this case, specific processing procedures apply Articles 52 through 58 mutatis mutandis.

Article 23 (Processing in Case of Shortage of Settlement Funds)

If the Bank of Korea cannot process the acquisition of Currency Stabilization Securities or government/local government bonds, or the request for transfer of registered Currency Stabilization Securities or government/local government bonds due to insufficient general current deposit balance of a Participating Institution, Articles 19 and 20 apply mutatis mutandis.

Article 24 (Damages)

If a Participating Institution causes obstacles to the Bank of Korea's withholding tax business due to false or erroneous message input when redeeming or repaying Currency Stabilization Securities or government/local government bonds, it must settle the under-withheld tax amount and compensate the Bank of Korea for any damages incurred without delay.

Section 4 Fund Transfers via Payment-Specific Current Deposit Accounts

Subsection 1 CLS System Settlement

Article 25 (Settlement Account)

CLS Settlement funds may be settled through the payment-specific current deposit account opened by CLS Bank with the Bank of Korea (hereinafter referred to as "CLS Bank Payment-Specific Current Deposit Account").

Article 26 (Deposit and Payment)

① Participating Institutions, which are CLS Bank settlement members (including Participating Institutions acting as agents for foreign CLS Bank settlement members' foreign currency fund settlements; hereinafter the same) notified of pay-in of foreign currency funds by CLS Bank, must deposit the funds into the CLS Bank Payment-Specific Current Deposit Account by the completion time specified by CLS Bank. ② The Bank of Korea deposits the relevant foreign currency funds into the payment-specific current deposit account of the CLS Bank settlement member receiving the payment (pay-out) from the CLS Bank Payment-Specific Current Deposit Account, according to CLS Bank's fund transfer application.

Article 27 (Processing in Case of Shortage of Settlement Funds)

If the Bank of Korea cannot process the fund transfer application under Paragraph 2 of Article 26 due to insufficient balance in the CLS Bank Payment-Specific Current Deposit Account, it shall reject the application and immediately notify CLS Bank of the content.

Article 28 (Notification of Processing Results)

The Bank of Korea shall immediately notify the remitting institution and receiving institution of the deposit and payment details when CLS Settlement funds are deposited into the CLS Bank Payment-Specific Current Deposit Account and when paid out from it, respectively, under Article 26.

Article 29 (Processing of Erroneously Transferred Funds)

Processing procedures for funds deposited into the CLS Bank Payment-Specific Current Deposit Account due to errors by other Participating Institutions shall be separately defined in the BOKFN usage agreement concluded between the Bank of Korea and CLS Bank.

Article 30 (Provision of Basic Information)

Participating Institutions that are CLS Bank settlement members and Participating Institutions acting as agents for foreign currency fund settlements for foreign CLS Bank settlement members must provide their Bank Identifier Code (BIC) and the BIC of the foreign CLS Bank settlement member for whom they act as agent to the Bank of Korea by five business days prior to the day settlement via them begins.

Article 31 (Emergency Business Processing, etc.)

Detailed matters such as the method of processing settlement business when deposit or payment of CLS Settlement funds via the BOKFN is impossible shall be separately defined in the BOKFN usage agreement concluded between the Bank of Korea and CLS Bank.

Subsection 2 Net Settlement

Article 32 (Target Transactions for Net Settlement)

The target transactions for net settlement under Article 8 of the Rules refer to transactions between Participating Institutions via the BOKFN through the following payment and settlement systems operated by the Korea Financial Telecommunications and Clearings Institute (KFTC), and fund adjustments resulting from such transactions:

1. Bill exchange system (including foreign currency-denominated domestic letter of credit bill exchange; hereinafter the same)
2. Giro system
3. Cash dispenser (CD) common network
4. Interbank remittance common network
5. Debit card common network
6. Cash Management Service (CMS) common network
7. Local bank common network
8. B2C electronic commerce payment and settlement system
9. Electronic financial common network
10. B2B electronic commerce payment and settlement system
11. Intercountry common network

Article 33 (Designated Processing Times)

① The designated processing times related to net settlement under Article 8, Paragraph 2 of the Rules and call fund transfers and treasury fund settlement under Article 11, Paragraph 2 of the Rules are as defined in <Table 2>.
② If the designated processing times under Paragraph 1 are the same, the processing order shall be determined by the Director of the Financial Payment Department.

Article 34 (Transmission of Net Settlement Data)

The KFTC must transmit net settlement application data for the net settlement target transactions under each item of Article 32 to the Bank of Korea one hour before the net settlement time for the relevant transaction defined in <Table 2>.

Subsection 3 General Fund Transfers

Article 35 (Application for Fund Transfers)

① Fund transfers under any of the items of Article 16, Paragraph 3 may be requested to the Bank of Korea only if they are transactions for which settlement occurs on that day.
② Participating Institutions may request reserved fund transfers to transfer funds to other Participating Institutions at a specific time from their payment-specific current deposit accounts, within the time defined by the Director of the Financial Payment Department. ③ Participating Institutions may choose to apply for the fund transfers under Paragraphs 1 and 2 as either a fast payment instruction or a normal payment instruction. However, after 7:30 PM, applications may only be made as fast payment instructions. ④ In Paragraph 3, "fast payment instruction" refers to a fund transfer application message requesting the Bank of Korea to process the fund transfer application immediately within the range of the payment-specific current deposit balance, and "normal payment instruction" refers to a fund transfer application message requesting the Bank of Korea to collect and simultaneously process fund transfer applications from Participating Institutions that are remitting or receiving institutions. ⑤ Participating Institutions may request reserved fund transfers to transfer funds to other Participating Institutions at the time of net settlement from their payment-specific current deposit accounts as fast payment instructions, within the time defined by the Director of the Financial Payment Department.

Article 36 (Setting of Net Payment Limit)

① A remitting institution may set an upper limit for the intraday net outflow of funds from its payment-specific current deposit account resulting from the processing of its normal payment instructions (hereinafter referred to as "Net Payment Limit").
② The "intraday net outflow of funds" under Paragraph 1 is the amount calculated by subtracting the cumulative amount of fast payment instructions and normal payment instructions received from other Participating Institutions from the cumulative amount of normal payment instructions processed for the remitting institution during the day. ③ The Net Payment Limit under Paragraph 1 is divided into "Bilateral Net Payment Limit" set for each other Participating Institution and "Total Net Payment Limit" set for all other Participating Institutions combined.

Article 37 (Processing of Fast Payment Instructions)

① The Bank of Korea shall immediately process fund transfer applications made as fast payment instructions by a remitting institution. However, this does not apply if the payment-specific current deposit balance of the relevant remitting institution is insufficient or if a previously applied fast payment instruction by the remitting institution is in a waiting state. ② The Bank of Korea shall record fast payment instructions by remitting institutions that are not immediately processed in a waiting file. ③ If a reserved fund transfer under Article 35, Paragraph 2 is applied as a fast payment instruction, the Bank of Korea shall process it according to Paragraphs 1 and 2 at the reserved processing time.

Article 38 (Processing of Normal Payment Instructions)

① The Bank of Korea shall record fund transfer applications made as normal payment instructions by a remitting institution in a waiting file.
② If a reserved fund transfer under Article 35, Paragraph 2 is applied as a normal payment instruction, the Bank of Korea shall process it according to Paragraph 1 at the reserved processing time.

Article 39 (Management of Waiting Files)

① The Bank of Korea shall assign waiting priority to fund transfer applications by each remitting institution via the payment-specific current deposit account according to the time they are recorded in the waiting file. However, fast payment instructions are given priority over normal payment instructions. ② Remitting institutions may adjust the waiting priority under Paragraph 1. ③ Remitting institutions may change the payment instruction type of fund transfer applications recorded in the waiting file under Paragraph 1 before 5:00 PM. However, the payment instruction type for securities and funds simultaneous settlement, fund transfers with designated beneficiaries, and reserved fund transfers under Article 35, Paragraph 5 cannot be changed. ④ If the Bank of Korea deems it necessary for smooth settlement, it may change some or all of the normal payment instructions recorded in a Participating Institution's waiting file to fast payment instructions, as determined by the Director of the Financial Payment Department.

Article 40 (Processing of Fund Transfer Applications in Waiting State)

① The Bank of Korea shall collect all fund transfer applications in a waiting state via the payment-specific current deposit account and simultaneously process them (hereinafter referred to as "Multilateral Simultaneous Processing") within the range of each remitting institution's payment-specific current deposit balance and the Net Payment Limit under Article 36. ② The Bank of Korea may process fast payment instructions in a waiting state in order as funds are deposited into the payment-specific current deposit account or as the highest waiting priority of the fast payment instruction changes. ③ If fund transfer applications by a remitting institution in a waiting state via the payment-specific current deposit account remain until the message input end time under Article 13, Paragraph 1 and Article 13, Paragraph 2, Items 7, 8, 11, and 12, the Bank of Korea may choose not to process them.

Article 41 (Suspension of Processing of Fund Transfer Applications)

Notwithstanding Articles 37, 38, and 40, the Bank of Korea may temporarily suspend the processing of fund transfer applications via the payment-specific current deposit account from the time net settlement data is input until net settlement is completed, to ensure smooth completion of net settlement between Participating Institutions.

Article 42 (Cancellation of Fund Transfer Applications)

A remitting institution cannot cancel a fund transfer application message via the payment-specific current deposit account once it has been received by the Bank of Korea. However, the remitting institution may cancel it in the following cases:

1. When the fund transfer application is in a waiting state due to insufficient payment-specific current deposit balance, exceeding the Net Payment Limit, etc.
2. When a reserved fund transfer is applied under Article 35, Paragraph 2

Article 43 (Return of Erroneously Transferred Funds)

If funds are transferred to the payment-specific current deposit account of a Participating Institution other than the legitimate receiving institution due to an error by the remitting institution, the Participating Institution that received the funds must immediately conduct a reverse transaction to restore the original state.

Subsection 4 Electronic Financial Common Network Linked Settlement

Article 43-2 (Linked Settlement)

The Bank of Korea may process fund transfer businesses by linking the BOKFN and the Electronic Financial Common Network of the KFTC under Article 8-2 of the Rules.

Article 43-3 (Application for Linked Settlement)

① When applying for linked settlement to the Bank of Korea, the KFTC must transmit a fund transfer application message including the remitting institution, receiving institution, settlement amount, etc., recorded in the Electronic Financial Common Network fund transfer message. ② Applications for linked settlement under Paragraph 1 may only be made as fast payment instructions.

Article 43-4 (Processing of Linked Settlement)

① The Bank of Korea shall immediately process linked settlement applications by the KFTC.
② Notwithstanding Paragraph 1, the Bank of Korea may reject the linked settlement application if the payment-specific current deposit balance of the remitting institution is insufficient, or if it is expected that net settlement funds will be insufficient from the time net settlement data is input until net settlement is completed.

Article 43-5 (Notification of Processing Results)

The Bank of Korea shall immediately notify the KFTC, receiving institution, and remitting institution of the processing results when processing linked settlement applications.

Article 43-6 (Return of Undepositable Funds)

If the receiving institution cannot deposit the amount into the beneficiary's account due to errors in the recorded items of the linked settlement application message, it must immediately return it to the remitting institution.

Subsection 5 Call Fund Transfers

Article 44 (Settlement of Call Funds)

① The Bank of Korea shall immediately process messages received from Participating Institutions for the supply and repayment of call funds.
② Notwithstanding Paragraph 1, if a Participating Institution supplies call funds by designating a repayment time under <Table 2>, the Bank of Korea shall process fund transfer businesses for the repayment of principal and interest according to the content of the message. ③ Notwithstanding Paragraph 1, for call transactions of one day or more where the supply and repayment of call funds under Paragraph 2 and the supply of call funds under Paragraph 1 occur between the same Participating Institutions on

Even if a regular payment instruction is included in the waiting file, if the balance of the settlement-specific current account temporarily exceeds the amount required to repay temporary settlement deficiency funds, the institution may prioritize the repayment transaction of such temporary settlement deficiency funds over other payment instructions.

Article 58-9 (Recording and Management of Intraday Repurchase Agreements) ① The Director of the Payment and Settlement Department must record and manage the settlement details of securities and funds for the initial transactions and repurchase transactions of intraday repurchase agreements.

② When the settlement details of securities and funds are recorded in accordance with Paragraph 1, intraday RP target institutions (including managers and bankruptcy trustees under the Act on Debtor Rehabilitation and Bankruptcy) cannot release, cancel, revoke, or deny the settlement of the initial transactions and redemption transactions of intraday repurchase agreements.

Chapter 4 Management of Settlement Risk
Section 1 Netting Limits

Article 59 (Transactions Subject to Netting Limit Setting) The transactions subject to the setting of netting limits under Article 19(1) of the Regulations refer to Transactions No. 4, 7, 9, and 11 among the net settlement target transactions listed in each item of Article 32 of these Rules, and transactions where payment instructions (including payment acceptances, hereinafter the same) between net settlement participating institutions are transmitted and received in real-time among Transactions No. 1, 3, 6, and 8.

Article 60 (Calcation Period for Unsettled Net Payments) The calculation period for unsettled net payments under Article 19(2) of the Regulations is as follows:

1. Before the net settlement time of each business day (in the case of a net settlement participating institution that delayed net settlement, the time when the net settlement was completed): from 0:00 AM of the previous business day to the time when the transaction occurred. However, for international joint networks, considering time zone differences, it is from the start time of the day's net settlement target transactions to the time when the transaction occurred.

2. After the net settlement time of Item 1 (in the case of a net settlement participating institution that delayed net settlement, the time when the net settlement was completed): from 0:00 AM of that business day to the time when the transaction occurred. However, for international joint networks, considering time zone differences, it is from the start time of the next day's net settlement target transactions to the time when the transaction occurred.

Article 61 (Setting of Netting Limits) ① Net settlement participating institutions participating in the payment and settlement systems listed in each item of Article 32 shall autonomously set the netting limits under Article 19(1) of the Regulations, taking into account past net payment patterns and future prospects.

② Notwithstanding Paragraph 1, if the result of the calculation of the collateral security amount under Article 64 or the evaluation of present value under Article 69 due to the use or disposal of collateral securities by the Bank of Korea under Article 22(1) of the Regulations results in a collateral security amount smaller than the collateral security amount that should be provided for the performance of settlement of net settlement target transactions, the Director of the Payment and Settlement Department may reduce the netting limit of the relevant institution by the insufficient amount.

③ Net settlement participating institutions shall not transmit payment instructions for netting limit setting target transactions to other net settlement participating institutions exceeding the netting limit set in accordance with Paragraph 1.

④ The Financial Services Commission shall build and operate an IT system for managing netting limits in real-time in relation to Paragraph 3.

Article 62 (Change of Netting Limits) ① If a net settlement participating institution wishes to newly set or change its netting limit, it must apply to the Bank of Korea.

② The Bank of Korea shall process applications for new setting or increase of netting limits from net settlement participating institutions after confirming the collateral deposit details under Article 21 of the Regulations.

③ If there is a new setting or change of netting limits according to Paragraphs 1 and 2, the Bank of Korea shall immediately notify the relevant institution and the Financial Services Commission.

Article 63 (Management of Netting Limits) ① Net settlement participating institutions shall make efforts to maintain their netting limits at an appropriate level by frequently inquiring with the Financial Services Commission about the status of netting limit consumption.

② If a net settlement participating institution cannot transmit payment instructions due to exceeding the netting limit, it must promptly notify the Bank of Korea and the client of the transaction of this fact and take necessary measures such as increasing the limit.

Section 2 Collateral Securities

Article 64 (Calculation of Collateral Security Amount) ① For net settlement target transactions to which the netting limit under Article 21(3)(2) of the Regulations does not apply, the collateral security amount to be provided by the net settlement participating institution shall be calculated by the Bank of Korea based on exchange results during the second half of the previous year and the first half of the current year in January and July of each year, respectively, and applied for six months starting from the following month.

② The average exchange net payment amount per net settlement time under Article 21(3)(2) of the Regulations shall be calculated by summing the exchange net receipt and net payment amounts of each net settlement target transaction having the same net settlement time, and averaging the net payment amounts on business days where the result appears as a net payment.

③ Notwithstanding Paragraphs 1 and 2, if there is a net settlement participating institution newly participating in any of the payment and settlement systems listed in each item of Article 32, the Director of the Payment and Settlement Department may apply different periods for calculating the collateral security amount to the relevant institution.

Article 64-2 (Basic Requirements for Collateral Target Securities) ① Securities that the Bank of Korea can acquire as collateral under each item of Article 21(1) of the Regulations must meet the following requirements:

1. The security amount must be denominated in Korean Won.
2. The principal must be fixed.
3. The interest rate must be fixed or linked to market interest rates or prices. However, the interest rate must be 0% or higher.

② Notwithstanding Paragraph 1, securities falling under any of the following items cannot be acquired as collateral securities for the performance of net settlement under Article 21(1) of the Regulations:

1. Subordinated bonds.
2. Convertible bonds, warrants-bearing bonds, and exchangeable bonds.
3. Securities issued by major shareholders under Article 2(1)(10) of the Banking Act, subsidiaries under Article 37 of the Banking Act, and affiliated companies under Article 2(12) of the Monopoly Regulation and Fair Trade Act.
4. Securities issued as private placements under Article 9(8) of the Capital Markets and Financial Investment Services Act.

Article 65 (Timing of Providing Collateral Securities) ① Each net settlement participating institution must provide collateral securities corresponding to the amount defined in Article 21 of the Regulations (hereinafter referred to as "Required Collateral Security Amount") to the Bank of Korea by the following times:

1. Collateral securities under Article 21(3)(1) of the Regulations: At the time of application for new setting or increase of the netting limit.
2. Collateral securities under Article 21(3)(2) of the Regulations: On the last day of the month in which the collateral security amount is calculated according to Article 64(1) of these Rules.

② Notwithstanding Paragraph 1, if the collateral security amount becomes less than the Required Collateral Security Amount because the collateral securities are used as collateral for loans from the Bank of Korea under Article 22(1) of the Regulations, the Bank of Korea may defer the provision of insufficient collateral securities to the relevant net settlement participating institution until a period determined by the Director of the Payment and Settlement Department.

Article 66 (Omission of Physical Delivery of Collateral Securities) Notwithstanding Article 65, if a net settlement participating institution registers a pledge right with the Bank of Korea, it may omit the physical delivery of the relevant collateral securities.

Article 67 (Calculation of Recognized Collateral Amount) ① The recognized collateral amount of collateral securities shall be the amount obtained by applying the recognition ratio to the relevant market price or face value (meaning the issue amount in the case of discount issuance) of the collateral securities, as specified in <Table 4>.

② The recognized collateral amount of securities belonging to Group 1 under Article 21(4) of the Regulations must be 40% or more of the total recognized collateral amount for each participating institution.

③ Notwithstanding Paragraph 2, if the recognized collateral amount of securities belonging to Group 1 becomes 40% or less of the total recognized collateral amount because the collateral securities are used as collateral for loans from the Bank of Korea under Article 22(1) of the Regulations, the Bank of Korea may defer the provision of insufficient Group 1 collateral securities to the relevant net settlement participating institution until a period determined by the Director of the Payment and Settlement Department.

Article 68 (Return of Collateral Securities) ① If the recognized collateral amount of collateral securities provided to the Bank of Korea by a net settlement participating institution exceeds the Required Collateral Security Amount, the institution may apply to the Bank of Korea for the return of the collateral securities.

② Upon such application, the Director of the Payment and Settlement Department shall return the collateral securities to the institution by the next business day following the application date.

Article 69 (Evaluation and Additional Demand for Collateral Securities) The Director of the Payment and Settlement Department shall regularly evaluate the present value of collateral securities and, if the result shows that the recognized collateral amount falls short of the Required Collateral Security Amount, may demand the relevant institution to provide additional collateral securities.

Article 70 (Disposal of Collateral Securities) ① When disposing of collateral securities under Article 22(2) of the Regulations, sale in the market shall be the principle.

② Notwithstanding Paragraph 1, if it is difficult to sell the relevant collateral securities in the market, the Bank of Korea may purchase them. In this case, the sales yield shall be determined considering the market yield of the securities on that day (or yields provided by registered bond rating agencies if no market yield exists), and the calculation of the purchase amount, etc., shall apply the relevant regulations on open market operations of the Bank of Korea.

Section 3 Joint Sharing of Settlement Deficiency Funds

Article 71 (Decision on Joint Sharing) If settlement deficiency funds are to be jointly shared under Article 23 of the Regulations, the Bank of Korea shall determine the sharing amount and settlement time for each net settlement participating institution and notify the relevant net settlement participating institution and the Financial Services Commission.

Article 72 (Net Settlement According to Joint Sharing) ① A net settlement participating institution that receives notification under Article 71 from the Bank of Korea must deposit the designated sharing amount into its settlement-specific current account by the designated settlement time.

② The Financial Services Commission shall rewrite the net settlement request form including the sharing amount for each net settlement participating institution and request the Bank of Korea to ensure settlement is made by the designated settlement time.

③ Upon receiving the net settlement request under Paragraph 2, the Bank of Korea shall process it according to the net settlement request form.

Section 4 Agency for Net Settlement

Article 73 (Application for Agency for Net Settlement) ① An institution wishing to act as an agent for net settlement under Article 26(1) of the Regulations must submit an agency for net settlement application form and an agreement regarding agency for net settlement, as determined by the Director of the Payment and Settlement Department, to the Bank of Korea.

② When making the application under Paragraph 1, the relevant institution must also submit the agency for net settlement contract concluded with the net settlement entrusted institution.

Article 74 (Approval Standards for Agency for Net Settlement) ① The approval standards under Article 25(3)(4) and Article 26(2) of the Regulations are as follows:

1. Based on the end of the quarter immediately preceding the application date (or the nearest quarter if data for the immediately preceding quarter is unavailable), the total capital ratio of the agency for net settlement applicant institution under the "Banking Supervision Regulations" must meet the management guidance ratio defined in the same Regulations (for newly established institutions, the expected ratio at the end of the fiscal year in which the application date falls).

2. Based on the month immediately preceding the application date (or the nearest month if data for the immediately preceding month is unavailable), the liquidity coverage ratio of the agency for net settlement applicant institution under the "Banking Supervision Regulations" must meet the management guidance ratio defined in the same Regulations (for newly established institutions, the expected ratio at the last month of the fiscal year in which the application date falls).

3. The agency for net settlement contract must include matters specified in <Table 3>.

4. The sum of individual net settlement agency limits for each net settlement agency bank under the agency for net settlement contract must be 10% or less of the own funds amount based on standards defined by the Bank for International Settlements (BIS) at the end of the quarter immediately preceding the application date of the agency for net settlement (or the expected amount at the end of the fiscal year in which the application date falls for newly established institutions).

5. The net settlement entrusted institution must have the ability to manage risks associated with net settlement, as determined by the Director of the Payment and Settlement Department.

② In cases where unavoidable reasons such as mergers or acquisitions of the net settlement agency bank or net settlement entrusted institution occur, the Director of the Payment and Settlement Department may defer the application of Item 4 of Paragraph 1. In this case, the deferral period shall be within one year and may be extended if necessary.

Article 75 (Approval of Agency for Net Settlement) ① If an application for agency for net settlement is made under Article 73, the Director of the Payment and Settlement Department shall evaluate whether the requirements for the net settlement entrusted institution under Article 25(3) of the Regulations and the approval standards under Article 74 are met, and then decide on the approval.

② If the agency for net settlement contract under Article 73(2) is terminated, the net settlement agency bank must submit an application for withdrawal of agency for net settlement to the Bank of Korea, as determined by the Director of the Payment and Settlement Department.

Article 76 (Post-Approval Management of Agency for Net Settlement) ① The Director of the Payment and Settlement Department shall regularly or as needed re-evaluate whether the approval standards under Article 74 are met. If the standards are not met, it may take necessary measures such as demanding plans to meet the standards, granting a deferral period necessary for compliance, or cancelling the approval for agency for net settlement.

② If the net settlement agency bank concludes a new agency for net settlement contract under Article 73(2) or if changes occur in items 1 through 6 of <Table 3>, it must apply for approval to the Bank of Korea.

③ If an application is made under Paragraph 2, the Director of the Payment and Settlement Department shall evaluate whether the approval standards under Article 74 are met and decide on the approval.

④ If changes occur in item 9 of <Table 3>, the net settlement agency bank must notify the Bank of Korea at least one week before the planned change date.

Article 77 (Setting/Change of Netting Limits for Net Settlement Entrusted Institutions) The setting/change of netting limits and sanctions for net settlement entrusted institutions shall apply Articles 59 through 63 and Article 91 mutatis mutandis. However, the netting limits of net settlement entrusted institutions shall be notified to the Bank of Korea and the Financial Services Commission by the net settlement agency banks.

Article 78 (Pledge of Collateral Securities of Net Settlement Entrusted Institutions) When providing collateral securities under Article 28(1) of the Regulations, if the net settlement agency bank has acquired eligible collateral securities under Article 21(1) of the Regulations from the net settlement entrusted institution under Article 28(2), it may provide them as collateral to the Bank of Korea up to the amount of collateral securities that should be provided for the net settlement entrusted institution. In this case, the provided collateral securities shall be managed separately for each net settlement entrusted institution.

Article 79 (Notification Status of Net Settlement Agency Banks) The phrase "circumstances determined by the Governor" in Article 30 of the Regulations refers to the following situations:

1. When a net settlement entrusted institution borrows funds from a net settlement agency bank during the day to pay net settlement funds but fails to repay the loan on the same day.
2. When a net settlement entrusted institution borrows funds from a net settlement agency bank for one day or more to pay net settlement funds.

Article 80 (Measures to Ensure Safety of Agency for Net Settlement Business) The Director of the Payment and Settlement Department may demand measures such as settlement risk reduction plans under Article 31 of the Regulations from net settlement agency banks and net settlement entrusted institutions.

Article 81 (Reasons for Direct Participation in Net Settlement by Net Settlement Entrusted Institutions) The reasons for direct participation in net settlement under Article 32(1) of the Regulations are as follows:

1. When the net settlement agency bank cannot perform net settlement business due to measures such as restriction or suspension of use of the Bank of Korea Financial Network under Article 43 of the Regulations, or cancellation of related agreements.
2. When an emergency situation such as a computer system failure, disaster, strike, terrorism, business suspension, or rapid deterioration of liquidity occurs or is feared in the net settlement agency bank, and it is judged that normal performance of agency for net settlement business is impossible.

Article 82 (Direct Participation in Net Settlement by Net Settlement Entrusted Institutions) ① If any of the circumstances listed in each item of Article 81 occurs, a net settlement entrusted institution may apply for direct participation in net settlement, as determined by the Director of the Payment and Settlement Department.

② If the Bank of Korea approves the application under Paragraph 1, it may determine the period and conditions for direct participation in net settlement.

③ If a net settlement entrusted institution participates directly in net settlement according to Paragraph 2, the relevant institution shall be regarded as a net settlement participating institution in relation to Articles 59 through 70.

Chapter 5 Monitoring of Payment and Settlement Systems

Article 83 (Principles for Financial Market Infrastructures) ① The "Principles for Financial Market Infrastructures" in Article 37(1) of the Regulations refers to <Table 6>.

② The Bank of Korea may utilize additional guidelines of the "Principles for Financial Market Infrastructures" jointly established by the Bank for International Settlements (BIS) and the International Organization of Securities Commissions (IOSCO) as evaluation criteria supplementing the principles in Paragraph 1.

Article 84 (Evaluation Cycle) Regular evaluations of important payment and settlement systems under Article 38(2) of the Regulations shall be conducted every three years in principle. However, if ad hoc evaluations are conducted under the proviso of Article 38(1)(1), regular evaluations may be replaced by ad hoc evaluations.

Article 85 (Evaluation Method) ① Evaluations of payment and settlement systems subject to monitoring under Article 38 of the Regulations shall be conducted by the Director of the Payment and Settlement Department.

② When evaluating payment and settlement systems, the Director of the Payment and Settlement Department shall classify the level of compliance for each evaluation item into five stages: Compliant, Generally Compliant, Partially Compliant, Non-compliant, and Not Applicable, and describe comprehensive evaluation opinions.

③ When evaluating payment and settlement systems, the Director of the Payment and Settlement Department may require the operating institution to conduct a self-evaluation first.

Article 86 (Publication of Evaluation Results) The Bank of Korea may publish the results of evaluations of important payment and settlement systems conducted under Article 38(1)(1) of the Regulations.

Article 87 (Requests for Improvement Based on Evaluation Results) ① The phrase "cases falling below the level determined by the Governor" in Article 39(1) of the Regulations refers to cases where the evaluation result is Partially Compliant or Non-compliant.

② Even if the evaluation result is Compliant or Generally Compliant, if the Bank of Korea judges it necessary to ensure the safety and efficiency of the payment and settlement system, it may request improvements for inadequate details in the evaluation items.

③ The phrase "cases involving technical or minor content" in Article 39(2) of the Regulations refers to cases where the evaluation result is Partially Compliant, or even if Compliant or Generally Compliant, there are inadequate details in the evaluation items.

Article 88 (Notification by Operating Institutions of Payment and Settlement Systems) The Director of the Payment and Settlement Department may determine specific matters such as notification reasons and procedures regarding notifications by operating institutions of payment and settlement systems under Article 40 of the Regulations.

Article 89 (Measures in Emergency Situations) The Director of the Payment and Settlement Department may temporarily change the operating hours, procedures, etc., of the Bank of Korea Financial Network if necessary in relation to measures under Article 41(1) of the Regulations. In this case, the Director of the Payment and Settlement Department must immediately notify the Director of the Financial Business Bureau of this matter.

Article 89-2 (On-site Inspections, etc.) ① The Director of the Payment and Settlement Department may establish staff (hereinafter referred to as "on-site inspection team members") to perform on-site inspections and other duties under Article 41(2) of the Regulations, and an on-site inspection team leader to oversee these duties.

② The Director of the Payment and Settlement Department may designate on-site inspection team members from among Bank of Korea employees who perform duties related to the operation of payment and settlement systems and related IT systems.

③ The Director of the Payment and Settlement Department shall notify relevant department heads of matters requiring action based on the results of on-site inspections, etc., and the relevant department heads shall take necessary actions regarding the notified matters and submit the results to the Director of the Payment and Settlement Department.

Article 90 (Operating Institution Council) The Bank of Korea may operate a council composed of relevant persons in charge of payment and settlement system operating institutions to efficiently perform monitoring duties of payment and settlement systems.

Chapter 6 Supplementary Provisions

Article 91 (Sanctions for Participating/Utilizing Institutions of Bank of Korea Financial Network) ① The Bank of Korea may take measures such as warnings or requests for correction if a participating institution or utilizing institution falls under any of the following items, except in unavoidable circumstances. However, if serious obstacles to the operation of the Bank of Korea Financial Network are caused by intent or gross negligence, general fund transfers may be restricted without measures such as warnings or requests for correction.

1. Violating Article 13(1) of the Regulations and delaying settlement due to insufficient balance in the settlement-specific current account at the net settlement time.
2. Violating Article 13(4) of the Regulations and leaking information obtained through the Bank of Korea Financial Network to the outside.
3. Failing to submit materials prescribed in Article 13(5) and Article 36 of the Regulations to the Bank of Korea within the deadline set by the Bank of Korea, or submitting false materials.
4. Failing to notify or delaying notification of emergency situations prescribed in Article 40(2) of the Regulations.
5. Sending documents through the Bank of Korea Financial Network by persons other than authorized senders registered under Article 8(1)(1) of these Rules.
6. Failing to immediately conduct reverse transactions for the return of erroneous transfer funds or funds unable to be deposited into the recipient's account, violating Article 21, Article 43, or Article 43-6 of these Rules.
7. Failing to immediately deposit funds into the recipient's account or immediately return inability-to-deposit funds to the transfer requesting institution, despite receiving payment notifications for recipient-designated fund transfers from the Bank of Korea, violating Articles 48 and 50 of these Rules.
8. Causing transactions where payment instructions are cancelled due to exceeding the netting limit, in relation to Article 61(3) of these Rules.
9. Failing to provide collateral securities by the time prescribed in Article 65(1) of these Rules.
10. Extending the operating hours of the Bank of Korea Financial Network due to reasons such as computer system failures, as described in Article 13(4)(3) of these Rules.
11. Violating other relevant regulations or directives of the Bank of Korea.

② If a participating institution that received sanctions under Paragraph 1 repeats any of the acts listed in each item of Paragraph 1 within one year from the time the sanctions were received, the Bank of Korea may take the following measures according to the number of occurrences. However, for acts falling under Item 5 of Paragraph 1, the number of consecutive occurrences per year shall be counted from the time the first sanction was received, and if general fund transfers are restricted, advance notice shall be given one week prior to allow sufficient preparation.

1. Occurrence 2 times: Direct notification of violation details and sanction facts to the Representative Director and Auditor (or Compliance Officer).
2. Occurrence 3 times: Measures under Item 1 and restriction of general fund transfers between participating institutions through the Bank of Korea Financial Network for one day.
3. Occurrence 4 times: Measures under Item 1 and restriction of general fund transfers between participating institutions through the Bank of Korea Financial Network for a period determined by the Director of the Payment and Settlement Department within one week.
4. Occurrence 5 times: Measures under Item 1 and restriction of general fund transfers between participating institutions through the Bank of Korea Financial Network for a period determined by the Director of the Payment and Settlement Department within one month.
5. Occurrence 6 times or more: Cancellation of the Bank of Korea Financial Network membership agreement or related agreements.

③ If participating institutions are integrated through mergers, etc., the number of occurrences under Paragraph 2 shall be calculated as separately determined by the Director of the Payment and Settlement Department.

Article 91-2 (Sanctions Related to Temporary Settlement Deficiency Fund Support) Sanctions under Article 51 of the Market Regulations related to support and repayment of temporary settlement deficiency funds are as follows. However, exceptions may apply if the cause is unavoidable.

1. Warning and Request for Statement of Reasons: When the number of times temporary settlement deficiency funds are repaid late during the settlement day within the agreement period is the 1st or 2nd time.
2. Reduction of Transaction Limits Due to Repayment Delay, etc.: When the number of times temporary settlement deficiency funds are repaid late during the settlement day within the agreement period is the 3rd time, the limit shall be reduced to 50% of the initial temporary settlement deficiency fund support limit.
3. Suspension of Temporary Transactions:
   a. When the number of times temporary settlement deficiency funds are repaid late during the settlement day within the agreement period is the 4th time. b. When the number of times repayment is not performed on the settlement day within the agreement period is the 1st time.
   c. When it is recognized that normal business performance is difficult due to deterioration of financial position or business suspension.
   d. Other cases involving significant violations related to securities trading transactions.
4. Cancellation of Intraday Repurchase Agreement for Securities Trading:
   a. When business performance is recognized as impossible due to cancellation of license/permit, business transfer, merger, dissolution, bankruptcy, or closure. b. When the number of times temporary settlement deficiency funds are repaid late during the settlement day within the agreement period is the 5th time.
   c. When the number of times repayment is not performed on the settlement day within the agreement period is the 2nd time.
   d. When transaction order is significantly disrupted by intentionally or with gross negligence violating relevant regulations.
5. Reduction of Transaction Limits Due to Inadequate Settlement Risk Management: When the intraday RP target institution fails to meet the settlement risk management standards defined in international standards for payment and settlement systems under Article 37 of the Regulations.

Article 92 (Exceptions to Application of Certain Regulations to CLS System) ① Notwithstanding Articles 4 through 8, 11, and 12, the joining and utilization of the Bank of Korea Financial Network by CLS Bank under Article 9 and Article 45(1) of the Regulations shall be separately stipulated in the Bank of Korea Financial Network Utilization Agreement concluded between the Bank of Korea and CLS Bank.

② Article 43 shall not apply to fund transfers deposited into the settlement-specific current account of CLS Bank.

③ Notwithstanding Articles 84 and 85, regarding monitoring duties for CLS Bank, Article 18(2), Article 33(3), and (4) of the Regulations shall not apply; instead, evaluations by consultative bodies between central banks bearing supervisory and primary monitoring responsibilities for CLS Bank, or equivalent supervision or monitoring activities, shall substitute them.

④ Notwithstanding Articles 88 and 89, regarding monitoring duties under Article 33(2) and (5) of the Regulations, matters shall be separately stipulated in the Bank of Korea Financial Network Utilization Agreement concluded between the Bank of Korea and CLS Bank under Article 45(2) of the Regulations.

Article 93 (Delegation) ① Matters necessary for the implementation of these Rules shall be determined by the Director of the Payment and Settlement Department.

② Detailed matters regarding IT business operations, including hardware, software, communication lines, security measures, and disaster recovery of the Bank of Korea Financial Network, shall be determined by the Director of the IT Strategy Bureau.

③ If the Director of the IT Strategy Bureau intends to enact or revise separate procedures, etc., under Paragraph 2, it must consult with the Director of the Payment and Settlement Department in advance.

Supplementary Provisions <2001. 12. 31>
Article 1 (Effective Date) These Rules shall enter into force on February 1, 2002.
Article 2 (Repeal Provisions) Simultaneously with the implementation of these Rules, the "Bank of Korea Financial Settlement Network Operation Rules" (established July 21, 1994, Money Issue 5980-25) are repealed.
Article 3 (Transitional Measures) Business handled under the "Bank of Korea Financial Settlement Network Operation Rules" and related agreements prior to the effective date of these Rules shall be treated as handled under these Rules.

Supplementary Provisions <2002. 2. 21>
These Rules shall enter into force on March 2, 2002.

Supplementary Provisions <2002. 7. 22>
These Rules shall enter into force on August 1, 2002.

Supplementary Provisions <2002. 9. 25>
These Rules shall enter into force on October 1, 2002.

Supplementary Provisions <2003. 6. 24>
These Rules shall enter into force on July 7, 2003.

Supplementary Provisions <2003. 10. 10>
These Rules shall enter into force on October 14, 2003.

Supplementary Provisions <2003. 12. 26>
These Rules shall enter into force on January 1, 2004. However, the effective dates for Items 5 through 7 of Article 46(5) shall be separately determined by the Director of the Payment and Settlement Department.

Supplementary Provisions <2004. 6. 24>
① (Effective Date) These Rules shall enter into force on July 1, 2004. However, the effective dates for Article 7 and <Table 2> of Article 52 shall be separately determined by the Director of the Payment and Settlement Department.
② (Transitional Measures) Until business continuity measures under Article 27 are established, the "Bank of Korea Financial Network Emergency Plan" shall substitute for these measures.

Supplementary Provisions <2004. 9. 24>
These Rules shall enter into force on October 1, 2004. However, Article 25(1) <Table 1> and Article 28(2) shall apply from November 29, 2004.

Supplementary Provisions <2005. 3. 14>
These Rules shall enter into force on April 1, 2005.

Supplementary Provisions <2005. 9. 1>
These Rules shall enter into force on September 1, 2005.

Supplementary Provisions <2006. 8. 24>
These Rules shall enter into force on August 24, 2006.

Supplementary Provisions <2006. 12. 20>
These Rules shall enter into force on January 2, 2007.

Supplementary Provisions <2007. 3. 9>
These Rules shall enter into force on April 2, 2007.

Supplementary Provisions <2007. 10. 16>
These Rules shall enter into force on December 3, 2007.

Supplementary Provisions <2007. 12. 14>
These Rules shall enter into force on January 11, 2008.

Supplementary Provisions <2008. 1. 25>
These Rules shall enter into force on March 7, 2008.

Supplementary Provisions <2008. 7. 9>
These Rules shall enter into force on August 1, 2008.

Supplementary Provisions <2008. 10. 9>
These Rules shall enter into force on November 3, 2008.

Supplementary Provisions <2009. 1. 22>
These Rules shall enter into force on February 4, 2009.

Supplementary Provisions <2009. 3. 26>
These Rules shall enter into force on April 1, 2009.

Supplementary Provisions <2009. 4. 3>
① (Effective Date) These Rules shall enter into force from a day separately determined by the Governor.
<Implemented on May 27, 2009, pursuant to Payment Policy Team-425 (Approved by Governor on April 20, 2009)> ② (Transitional Measures) Bank of Korea Financial Network Utilization Agreements concluded between the Bank of Korea and payment and settlement system operating institutions prior to the effective date of these Rules shall be deemed as New Bank of Korea Financial Network Utilization Agreements concluded under Article 7 of the Regulations, Article 16 of the Regulations, and Article 7(1) of these Rules.

Supplementary Provisions <2009. 5. 25>
These Rules shall enter into force on June 1, 2009.

Supplementary Provisions <2009. 12. 16>
These Rules shall enter into force on January 1, 2010. However, the effective date for Article 5(6) shall be separately determined by the Director of the Payment and Settlement Department.

Supplementary Provisions <2010. 1. 26>
These Rules shall enter into force on February 1, 2010.

Supplementary Provisions <2010. 11. 4>
These Rules shall enter into force on December 1, 2010.

Supplementary Provisions <2010. 12. 23>
These Rules shall enter into force on January 1, 2011. However, the effective date for Article 60 shall be determined by the Director of the Payment and Settlement Department.

Supplementary Provisions <2011. 2. 22>
These Rules shall enter into force on April 1, 2011. However, Article 69(2) shall enter into force from a day separately determined by the Director of the Payment and Settlement Department.

Supplementary Provisions <2011. 11. 18>
These Rules shall enter into force on November 21, 2011.

Supplementary Provisions <2012. 2. 3>
These Rules shall enter into force on February 6, 2012.

Supplementary Provisions <2012. 12. 27>
These Rules shall enter into force on December 27, 2012. However, Article 13(2)(7), Article 40(3), Article 52(10), and Article 54(1) shall enter into force on January 15, 2013.

Supplementary Provisions <2013. 7. 11>
These Rules shall enter into force on July 11, 2013. However, the effective dates for Article 58-2, Article 58-5, the proviso of Article 58-6(1), Article 67, Item 2 of <Table 4>, and revised provisions of Article 69 shall be separately determined by the Director of the Payment and Settlement Department.

<Article 67 and Item 2 of <Table 4>, Article 69 implemented on September 10, 2013, pursuant to Payment Operations Team-657 (Approved by Director on September 4, 2013)>.

Supplementary Provisions <2014. 3. 27>
These Rules shall enter into force on April 1, 2014.

Supplementary Provisions <2015. 11. 26>
Article 1 (Effective Date) These Rules shall enter into force on January 1, 2016. However, revised provisions of Article 13(2) and Article 46 shall enter into force on December 15, 2015.
Article 2 <Deleted>

Supplementary Provisions <2016. 2. 25>
These Rules shall enter into force on February 26, 2016.

Supplementary Provisions <2016. 11. 24>
These Rules shall enter into force on November 24, 2016.

Supplementary Provisions <2017. 12. 7>
These Rules shall enter into force on December 7, 2017.

Supplementary Provisions <2018. 12. 20>
These Rules shall enter into force on August 1, 2019. However, Article 83(2), deletion of Article 2 (Validity Period) of Supplementary Provisions <2015. 11. 26>, application of collateral recognition ratios for housing mortgage securities issued by Korea Housing Finance Corporation in <Table 4> shall apply from December 20, 2018, and Article 20(1) and Article 42 shall enter into force on March 1, 2019.

Supplementary Provisions <2020. 4. 9>
Article 1 (Effective Date) These Rules shall enter into force from a day separately determined by the Governor.
<Implemented on May 25, 2020, pursuant to Payment Policy Team-267 (Approved by Governor on May 6, 2020)>
Article 2 (Validity Period) Matters related to Item 7 and Item 8 of Article 21(1) of the "Payment and Settlement System Operation and Management Regulations" in Article 64-2 and <Table 4> shall remain in effect until March 31, 2021.

Supplementary Provisions <2020. 6. 25>
These Rules shall enter into force on June 24, 2020.

Supplementary Provisions <2020. 9. 10>
Article 1 (Effective Date) These Rules shall enter into force from a day separately determined by the Governor.
<Implemented on October 12, 2020, pursuant to Payment Policy Team-667 (Approved by Governor on October 5, 2020)>
Article 2 (Transitional Measures) Notwithstanding the revision of <Table 5>, for participants in the Bank of Korea Financial Network at the time of implementation of these Rules, the revised provisions of Item 4 of <Table 5> shall apply from the re-evaluation of compliance with the joining criteria under Article 6(1) implemented after January 1, 2022.

Supplementary Provisions <2022. 3. 25>
These Rules shall enter into force on April 1, 2022.

Supplementary Provisions <2022. 10. 27>
Article 1 (Effective Date) These Rules shall enter into force on November 1, 2022.
Article 2 (Validity Period) Deleted

Supplementary Provisions <2023. 1. 16>
These Rules shall enter into force on January 31, 2023.

Supplementary Provisions <2023. 2. 8>
These Rules shall enter into force on February 3, 2023.

Supplementary Provisions <2023. 4. 11>
These Rules shall enter into force on April 30, 2023.

Supplementary Provisions <2023. 7. 27>
These Rules shall enter into force on July 31, 2023.

Supplementary Provisions <2023. 8. 25>
These Rules shall enter into force on August 31, 2023. However, Item 2 of <Table 4> related to Item 11 of Article 21(1) of the Regulations shall enter into force on September 20, 2023.

Supplementary Provisions <2024. 3. 29>
These Rules shall enter into force on April 1, 2024.

Supplementary Provisions <2024. 6. 13>
These Rules shall enter into force on September 2, 2024.

Supplementary Provisions <2025. 6. 5>
Article 1 (Effective Date) These Rules shall enter into force on June 5, 2025.
Article 2 (Transitional Measures) Business performed under the previous Rules prior to the effective date of these Rules shall be deemed as performed by the department responsible for handling such business under these Rules.

Supplementary Provisions <2026. 3. 25>
Article 1 (Effective Date and Transitional Measures) These Rules shall enter into force on March 30, 2026. Business performed prior to the effective date of these Rules shall be governed by the previous Rules.
Article 2 (Exception to Effective Dates for Articles 42 and 44) Notwithstanding Article 1 of this Supplementary Provision, the effective dates for the revised Rules of Articles 42 and 44 shall be separately determined by the Director of the Payment and Settlement Department.
<Implemented on May 26, 2026, pursuant to Payment Settlement Innovation Team-79 (Approved by Director on May 14, 2026)>

Supplementary Provisions <2026. 8. 27>
These Rules shall enter into force from a day separately determined by the Governor.
<Implemented on September 21, 2026, pursuant to Payment Settlement Innovation Team-218 (Approved by Governor on September 17, 2026)>

<Table 1> Bank of Korea Financial Network Usage Fees Bank of Korea Financial Network Usage Fees Unit: KRW Category | Fee | Remarks Before 16:00 | 16:00 to Before 20:00 | After 20:00 Fixed Fee (Monthly) | 100,000 KRW | 1) Fee Per Transaction | | KRW Fund Transfer | | Inter-participant Fund Transfer | 200 | 700 | 4,000 | 5) Transfer Between Accounts Within Bank of Korea for Participants | | | Recipient-Designated Fund Transfer | | | Call Fund Supply | | | Call Fund Repayment | | | Securities/Fund Simultaneous Settlement | | | Fund Transfers Related to Bank of Korea's Securities Custody Business | | | CLS Settlement Fund Transfer | 2,000 | 2,500 | 5,500 | Foreign Currency Fund Transfer | | Inter-participant Foreign Currency Fund Transfer | 200 | 700 | 4,000 | Inter-branch Foreign Currency Fund Transfer for Participants Government Bonds, etc. Transactions | | Book Entry Registration Application | 200 | 700 | 4,000 | Registration Change (Assignment) Application for Government Bonds, etc. Other Cancellations | 1,000 | 1,000 | 4,000 | 7) Note: 1. Applied based on the application time. However, usage fees for fund transfer business completed after 20:00 are applied based on the completion time.
2. For fund transfers related to the following transactions, 20:00 is changed as follows:
a. Intraday Current Account Loan Repayment: 20:20 b. Fund Adjustment Deposit Withdrawal/Deposit: 20:30
3. If fund transfers occur after 20:00 due to Bank of Korea computer failure or reasons determined by the Director of the Payment and Settlement Department, the fee for the 16:00 to Before 20:00 time slot applies. However, in case of Bank of Korea computer failure, if the failure occurred before 16:00 and was restored after 20:00, the fee for before 16:00 applies to all fund transfers performed after restoration.
4. For new joiners, prorated calculation from the joining date; for withdrawals, prorated calculation until the last business day before the withdrawal date. However, exempt for participants without dedicated terminals (not applicable if the main computer-accessing participant does not install a dedicated terminal).
5. Not levied for linked settlements.
6. Issuance/Redemption of Stabilization Funds Securities, Trading of Government Bonds, etc., Issuance/Redemption of National Bonds.
7. Not levied for transfer applications cancelled by the Bank of Korea under Article 56(3) of these Rules.

<Table 2> Designated Processing Times for Bank of Korea Financial Network Designated Processing Times for Bank of Korea Financial Network Category | Processing Time Net Settlement System, Cash Dispenser (CD) Common Network, Inter-bank Exchange Common Network, Debit Card Common Network, Cash Management Service (CMS) Common Network, Local Bank Common Network, B2C Electronic Commerce Payment and Settlement System, B2B Electronic Commerce Payment and Settlement System, Electronic Finance Common Network, Bill Exchange System | 11:00 International Joint Network | 14:00 Collection of Treasury Fund Receipts | 14:05 Call Fund Repayment | | Morning Half-Day | 16:05 Afternoon Half-Day | 11:05 One Day or More | | Execution of Reserved Fund Transfers for Net Settlement Time | 16:00 1) Foreign Currency Fund Deposit | | Note: 1) Japanese Yen fund deposits are processed on the next day at 09:30.

<Table 3> Matters to Be Reflected in Agency for Net Settlement Contract Matters to Be Reflected in Agency for Net Settlement Contract

1. Scope and limit of agency for net settlement business
2. Obligation of the net settlement agency bank to perform net settlement
3. Acknowledgment that the net settlement entrusted institution has an obligation to provide collateral to the net settlement agency bank exceeding the agency contract limit
4. Matters regarding settlement between parties for the net settlement amount
5. Matters regarding liquidity support/repayment by the net settlement agency bank and reduction of the agency bank's netting limit in case of non-repayment
6. Matters regarding delay compensation and collateral disposal in case of delayed or unpaid net settlement amounts
7. Acknowledgment that the net settlement agency bank may pledge eligible collateral securities provided by the net settlement entrusted institution to the Bank of Korea within the amount determined by the Bank of Korea
8. Obligation of the net settlement entrusted institution to maintain and manage its netting limit at an appropriate level
9. Validity period and grounds for termination of the agency for net settlement contract
10. Acknowledgment that the net settlement entrusted institution may participate directly in net settlement
11. Acknowledgment that the agency for net settlement contract takes effect upon approval by the Bank of Korea

<Table 4> Collateral Recognition Ratios
Collateral Recognition Ratios

1. For securities among Items 1 through 12 of Article 21(1) of the Regulations that have formed market prices, the following ratios are applied to the market price based on remaining maturity and principal/interest payment method. In this case, the market price is calculated as the simple arithmetic average of prices on the business day immediately preceding the market price assessment date (or the nearest previous business day if price information for that day is unavailable) provided by two or more bond rating agencies registered with the Financial Services Commission under the Capital Markets and Financial Investment Services Act.
   Security Credit Rating | Remaining Maturity
   --- | ---
   | ≤ 1 Year | > 1 Year to ≤ 3 Years | > 3 Years to ≤ 5 Years | > 5 Years to ≤ 10 Years | > 10 Years
   Securities under Article 21(1) Items 1 & 2 of Regulations | - | 98 (98) | 97 (96) | 96 (95) | 95 (94) | 93 (92) Securities under Article 21(1) Item 9 of Regulations | - | 96 (96) | 95 (94) | 94 (93) | 93 (92) | 92 (91) Securities under Article 21(1) Items 3-7 of Regulations | AAA | 96 (96) | 95 (94) | 94 (93) | 93 (92) | 92 (91)
   | AA+ ~ AA- | 95 (95) | 94 (93) | 93 (92) | 92 (91) | 91 (90)
   Securities under Article 21(1) Item 10 of Regulations | AAA | 95 (95) | 94 (93) | 93 (92) | 92 (91) | 91 (90)
   | AA+ ~ AA- | 94 (94) | 93 (92) | 92 (91) | 91 (90) | 90 (89)
   Securities under Article 21(1) Items 8 & 11 of Regulations | AAA | 94 (94) | 93 (92) | 92 (91) | 91 (90) | 90 (89)
   | AA+ ~ AA- | 93 (93) | 92 (91) | 91 (90) | 90 (89) | 89 (88)
   Securities under Article 21(1) Item 12 of Regulations | AAA | 90 (90) | 88 (87) | 87 (86) | 86 (85) | 85 (84)
   | AA+ ~ AA- | 85 (85) | 83 (82) | 82 (81) | 81 (80) | 80 (79)
   Note: 1) Refers to credit ratings obtained from one or more credit rating agencies under the Capital Markets and Financial Investment Services Act; if ratings from two or more agencies differ, the lowest rating applies. 2) Remaining maturity is based on the market price assessment date. 3) Collateral recognition ratios are based on coupon bonds; values in () apply to discount bonds and other securities where principal and interest are paid at maturity. 4) Excludes bonds guaranteed by the government for principal and interest repayment. 5) Excludes securities issued by financial companies (companies engaged in "Finance and Insurance" under the Korea Standard Industrial Classification, excluding non-financial holding companies) and securitization companies.
2. For securities among Items 1 through 11 of Article 21(1) of the Regulations that do not have formed market prices, 80% of the face value (issue amount in case of discount issuance) is applied; for Item 12 securities without formed market prices, 70% of the face value (issue price in case of discount issuance) is applied.

<Table 5> Bank of Korea Financial Network Joining Criteria Bank of Korea Financial Network Joining Criteria Category | Criteria | Content

1. Financial Soundness Standards Defined by Supervisory Authority | a. Banks: Total capital ratio under "Banking Supervision Regulations" must be 8% or higher.
   b. Comprehensive Financial Companies and Securities Financial Companies: Own funds ratio against risk-weighted assets under "Financial Investment Services Regulations" must be 8% or higher.
   c. Financial Investment Service Providers

• Type 1 Financial Investment Service Provider: Net capital ratio under "Financial Investment Services Regulations" must be 100% or higher.
• Type 2 Financial Investment Service Provider: Own funds must be at least the minimum operating capital under "Financial Investment Services Regulations".
  d. Insurance Companies: Solvency margin ratio under "Insurance Business Supervision Regulations" must be 100% or higher. e. Other Institutions: Standards defined by the Director of the Payment and Settlement Department among financial soundness standards defined by the supervisory authority.

2. Expected Number of Uses | Must be 50 or more transactions per month on average during the first year after joining.
3. Dedicated Personnel | Must have at least 4 personnel in total, including 2 users of one-time password generators and 2 users of terminals, with no single person holding both roles.
4. Business Continuity Capability | Must install Bank of Korea Financial Network terminals in two or more locations (based on buildings) to prepare for disasters or disruptions.
   Note: 1) For institutions without a supervisory authority or without financial soundness standards defined by the supervisory authority, these criteria do not apply; the financial soundness ratios disclosed by the institution at the time of application (or expected ratios at the end of the fiscal year for newly established institutions) serve as the basis. 2) Refers to devices generating one-time passwords used for important transactions requiring authorization by authorized persons in business conducted using the Bank of Korea Financial Network. 3) Refers to PCs of participating institutions registered with the Bank of Korea for using the Bank of Korea Financial Network. 4) Includes terminals connected via public network lines according to the "Bank of Korea Financial Settlement Network IT Business Operation Procedures".

<Table 6> Principles for Financial Market Infrastructures Principles for Financial Market Infrastructures Item | Content General Organization | 1. Legal Basis: Operational regulations and business processing procedures must be clear, transparent, and consistent with relevant laws.
2. Governance: Must have clear and transparent governance that aligns with public interest and supports the interests of participating institutions and other relevant stakeholders.
3. Comprehensive Risk Management System: Must establish a system to comprehensively manage legal risk, credit risk, liquidity risk, and operational risk.
Credit and Liquidity Risk Management | 4. Credit Risk: Must establish a system to effectively measure, monitor, and manage exposure to credit risk from participating institutions and credit risk exposure generated during its own system operation, and hold sufficient financial resources to manage credit risk.
5. Collateral: Must limit collateral used to manage credit risk exposure to collateral with low credit, liquidity, and market risk, and evaluate and manage it conservatively.
6. Margin: Must have a margin system capable of managing exposure to credit risk from participating institutions and review it regularly.
7. Liquidity Risk: Must establish a system to effectively measure, monitor, and manage exposure to liquidity risk from participating institutions and liquidity risk exposure generated during its own system operation, and hold sufficient financial resources to manage liquidity risk.
Settlement | 8. Settlement Finality: Must establish a system to complete final settlement by the end of business hours on the settlement day.
9. Funds Settlement: Final settlement of funds must be achieved through Bank of Korea deposit accounts. If not, a system must be established to manage potential credit and liquidity risks.
10. Physical Delivery: Must specify the operating institution's obligations related to the acceptance and delivery of securities, identify, monitor, and manage related risks.
Central Counterparties and Value-Exchange Payment Systems | 11. Central Securities Depositories: Must establish a system to manage securities in dematerialized or uncertificated forms, minimize and manage risks related to custody and transfer of securities, and have appropriate regulations and procedures.
12. Value-Exchange Payment Systems: For transactions involving the settlement of two linked obligations, must establish a system where final settlement of one obligation is conditional upon final settlement of the other obligation.
Default Management | 13. Participant Default Rules and Procedures: Must have clear and transparent default handling procedures including necessary response measures to continuously fulfill obligations as an operating institution upon occurrence of participant default.
14. Segregation and Portability: Must have regulations and procedures enabling segregation of customer assets of participating institutions and collateral provided to Central Counterparties (CCPs), and portability of accounts.
General Business and Operational Risk Management | 15. General Business Risk: Must identify, monitor, and manage general business risk and hold sufficient resources to ensure continuous operation of the payment and settlement system even if losses occur.
16. Custody and Investment Risk: Must establish a system to prevent loss of operating institution's own assets and participating institutions' assets and enable swift exercise of rights, and limit investment targets of the operating institution to financial products with low credit, market, and liquidity risk.
17. Operational Risk: Must identify internal and external causes that could generate operational risk, establish appropriate systems to reduce such risks, secure institutional devices for security and operational reliability, and prepare measures for business continuity.
Participation | 18. Participation Criteria: Must establish and disclose participation criteria that consider risk and ensure fairness and objectivity.
19. Hierarchical Participation System: Must establish a system to identify, monitor, and manage significant risks arising from hierarchical participation systems.
20. Linkage with Other Payment and Settlement Systems: When linking with domestic and international payment and settlement systems, must establish a system to identify, monitor, and manage risks arising from linkage.
Efficiency | 21. Efficiency and Effectiveness: Must provide practical and efficient payment instruments.
22. Communication Procedures and Standards: Must use internationally accepted or equivalent communication procedures and standards.
Transparency | 23. Disclosure of Regulations, Major Procedures, and Market Data: Must have clear and comprehensive regulations and procedures, disclose them, and provide accurate and sufficient information on risks borne by participating institutions due to participation in the payment and settlement system, fees, and other important costs.