I. Basic policy direction

- The Government is to announce on the loss sharing participated by each different industry of the financial sector followed by the Daewoo workouts and prepare plans accordingly for each industry.

- With respect to the investment trust and securities companies, the Government is fully committed to guaranteeing 50 to 95 percent of the redemption ratios for individual and non-financial institutional investors holding beneficiary certificates with the ITCs.

● Clearly outline the principle of loss sharing between investment trust management companies and securities companies in charge of the sales.

● As for investment trust and securities companies with clearly identified major shareholders, the Government will facilitate management normalization through inducing recapitalization by major shareholders.

● In the case of institutions suffering accumulated deficit and without major shareholders such as Korea and Daehan investment trust companies, the Government will take an early action to rehabilitate them by injecting public funds.

● In addition, the Government will pursue development of plans pertaining to the strengthening of transparency in asset management and competitiveness in the investment trust industry in Korea.

- For Daewoo bonds guaranteed by Seoul Guarantee Insurance Corporation as Daewoo affiliates undergo their workouts, in case principal capital and interest payments are forgiven, Seoul Guarantee Insurance Corporation will make repayments for the market stability.

- For the market stability, the Government will maintain interest rates at stable levels and, at the same time, develop liquidity support plans in preparation of the increased level of withdrawals of funds from the investment trust companies.

* Please refer to the attached file for details.