WOORI BANK Principal terms and conditions of the MTN Programme

1.01 (a)

Background Information Issuer (i)

Name

: Woori Bank (“Woori”)

(ii)

Address

: 203 Hoehyon-dong, 1-ga, Chung-gu, Seoul, Korea

(iii)

Business registration no.

: 110111-0023393

(iv)

Date/place of incorporation

: 1899 / Korea

(v)

Date of listing

: Listed on the Korea Stock Exchange on 3 March 1956 and subsequently delisted on 27 April 2002 (the delisting was due to the listing of Woori Finance Holdings Co., Ltd., the 100% shareholder of Woori).

(vi)

Status

: Non-resident controlled company Non-Bumiputera controlled company

(vii) Principal activities

: Woori is principally engaged in a broad range of businesses, including commercial banking, credit cards, capital markets activities, international banking, asset management and bancassurance.

(viii) Board of directors (as at 29 February 2008)

: 1.

Hae Choon Park (President and Chief Executive Officer)

2.

Soon Woo Lee (Director/Executive Vice President)

3.

Won Kuen Yang (Director/Standing Audit Committee Member)

4.

Byong Won Bahk (Non-Standing Director)

5.

Moon Hwan Kim (Non-Standing Director)

6.

Sung Keun Ha (Non-Standing Director)

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WOORI BANK Principal terms and conditions of the MTN Programme

7.

Kyung Hee Yoon (Non-Standing Director)

8.

Kyung Soo Choi (Non-Standing Director)

9.

Jong Man Kang (Non-Standing Director)

10. Hyeon Chul Joe (Non-Standing Director) 11. Han Ju Kim (Non-Standing Director)

(ix)

(x)

Structure of shareholdings and names of shareholders (as at 29 February 2008)

Authorised and paid-up capital (as at 29 February 2008)

: Common Stock holder

:

Direct Number of common stock held

%

Woori Finance Holdings Co., Ltd.

635,956,580

100

Type

Number of common stock

Par value (W)

(W million)

Authorised Common Stock

2,000,000, 000

5,000

10,000,000

Issued and paid-up Common Stock

635,956,5 80

5,000

3,179,783

2

Indirect Number % of common stock held -

Amount

WOORI BANK Principal terms and conditions of the MTN Programme

1.02

Principal Terms and Conditions:

(a)

Names of parties involved in the proposed transaction (i)

Principal Adviser(s)/ Lead Arranger(s)

:

RHB Investment Bank Investment Bank”)

(ii)

Arranger(s)

:

Not applicable

(iii)

Valuers

:

Not applicable

(iv)

Solicitors

:

(a) Zul Rafique & Partners (Lead Arranger’s Malaysian Counsel)

Berhad

(“RHB

(b) Kim & Chang (Issuer’s Korean Counsel)

(b)

(v)

Financial adviser

:

Not applicable

(vi)

Technical adviser

:

Not applicable

(vii) Guarantor

:

Not applicable

(viii) Trustee

:

Equity Trust (Malaysia) Berhad (Company No. 610812-W)

(ix)

Facility Agent

:

RHB Investment Bank

(x)

Primary subscriber(s) and amount subscribed (where applicable)

:

Not applicable

(xi)

Underwriter(s) and amount underwritten

:

Not applicable (provision waived under Practice Note 2B)

(xii) Central Depository

:

Bank Negara Malaysia (“BNM”)

(xiii) Paying Agent

:

BNM

(xiv) Reporting Accountant

:

None

(xv) Others

:

Rating Agency Malaysian Rating Corporation (Company No. 364803 V) (“MARC”)

Facility description

:

Berhad

Medium Term Notes Programme (“MTN Programme”)

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WOORI BANK Principal terms and conditions of the MTN Programme

(c)

Issue size (RM)

:

Up to RM1.0 billion (Ringgit Malaysia One Billion) in nominal value.

(d)

Issue price (RM)

:

The Medium Term Notes (“Notes”) will be issued at par, or at a discount or at a premium to face value, to be determined closer to each issuance.

(e)

Tenor of the facility/issue

:

Up to ten (10) years from the date of first issue of the Notes. Maturity of the Notes The Notes may be issued with maturities exceeding one (1) year, provided always that the final maturities of any of the Notes shall not exceed the tenor of the MTN Programme.

(f)

Interest/coupon (%) (please specify)

:

The Notes may be either interest bearing at fixed rate or floating rate, or non-interest bearing (zero coupon), to be determined by Woori prior to each issuance.

(g)

Interest/coupon payment frequency

:

Semi-annually in arrears from the date of issue of the Notes with the last interest payment to be made on the maturity date.

(h)

Interest/coupon payment basis

:

Actual number of days elapsed on a 365-day basis.

(i)

Yield to maturity (%)

:

To be determined upon each issuance.

(j)

Security/collateral (if any)

:

None

(k)

Details on utilisation of proceeds

:

The proceeds of the Notes will be used by Woori for its general operations.

(l)

Sinking fund (if any)

:

None

(m)

Rating

:

Long-term rating of AAA assigned by MARC.

(n)

Form and denomination

:

The Notes will be issued in a minimum denomination of RM1,000,000 or integral multiples thereof. Each issue of the Notes will be represented by a global certificate in bearer form (which is exchangeable for definitive certificates only in limited circumstances) to be deposited with BNM as the Central Depository, and will be traded under the Real Time Electronic Transfer of Funds and Securities (“RENTAS”) System

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WOORI BANK Principal terms and conditions of the MTN Programme

operated and maintained by BNM. The Notes shall be issued in accordance with the Rules on Fully Automated System for Issuing/Tendering (“FAST”) issued by BNM (“FAST Rules”). (o)

Mode of issue

:

Book building or private placement, to be determined prior to each issuance, without prospectus.

(p)

Selling restriction

:

Selling Restrictions upon Issuance The Notes may not be offered, sold or delivered, directly or indirectly, nor may any document or other material in connection therewith be distributed in Malaysia, other than to persons falling within Schedule 6 or Section 229(1)(b) and Schedule 7 or Section 230(1)(b) and Schedule 9 or Section 257(3) of the Capital Markets and Services Act, 2007 of Malaysia (“CMSA”). Selling Restrictions after Issuance The Notes may not be offered, sold or delivered, directly or indirectly, nor may any document or other material in connection therewith be distributed in Malaysia, other than to persons falling within Schedule 6 or Section 229(1)(b) and Schedule 9 or Section 257(3) of the CMSA.

(q)

Listing status

:

The Notes will not be listed on the Bursa Malaysia Securities Berhad or any other stock exchange.

(r)

Minimum level of subscription (RM or %)

:

Not applicable (provision waived under Practice Note 2B)

(s)

Other regulatory approvals required in relation to the issue, offer or invitation and whether or not obtained (please specify)

:

Woori has obtained the approval of BNM on the 13 February 2008, attached as Appendix 4, for the following: i.

approval to establish Programme; and

the

ii. the swap arrangements by Woori. (t)

Conditions precedent

:

Including but not limited to the following:

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MTN

WOORI BANK Principal terms and conditions of the MTN Programme

(a) execution of all documents in respect of the MTN Programme; (b) all required regulatory and other approvals for the establishment of the MTN Programme being obtained; (c) receipt of legal opinion from Zul Rafique & Partners, in form and substance acceptable to the Lead Arranger; (d) receipt of legal opinion from Kim & Chang, in form and substance acceptable to the Lead Arranger; (e) such other conditions precedents customary for transaction of this nature, as may be reasonably advised by any of the Solicitors and agreed with the Issuer. (u)

Representations and warranties

:

Representation and warranties typical and customary for a transaction of this nature, which shall include but is not limited to the following: (a) Status: the Issuer is a company duly incorporated and validly existing under the laws of Korea and has full power and authority to conduct and carry on the business in which it is or proposes to be engaged in; (b) Powers and Authorisations: the Issuer has the power and capacity to execute, deliver and perform the obligations under the Transaction Documents, and the Issuer has taken all necessary corporate and other actions to authorise the execution, delivery and performance of the Transaction Documents, and each of the Transaction Documents will constitute legal, valid and binding obligations which are enforceable on and against the Issuer; (c) Non-violation: neither the execution and delivery of the Transaction Documents nor the performance of any of the transactions contemplated therein, does or will contravene or constitute a default under, or cause to be exceeded, any limitation on the Issuer or the powers of its directors imposed by or contained in, (i)

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WOORI BANK Principal terms and conditions of the MTN Programme

any law, regulations or by-laws by which the Issuer, or any of its assets are bound or affected, (ii) the Articles of Incorporation of the Issuer or (iii) any agreement to which the Issuer is a party or by which any of its assets are bound; all necessary actions, (d) Consents: authorizations and consents required in order for the Issuer to execute, deliver and perform its obligations under the Transaction Documents have been taken, fulfilled and obtained and remain in full force and effect; (e) No default: no event has occurred which constitutes or which with the giving of notice and/or the lapse of time and/or a determination by the relevant third party would constitute, a contravention or default under, any agreement or instrument by which the Issuer or any of its assets are bound or affected, being a contravention or default which might have a material adverse effect; (f) Information Memorandum: as at the date of its or their issuance, (i) the Information Memorandum and the written information furnished or to be furnished by the Issuer in connection with the issuance of any of the Notes and the Transaction Documents (the “Offering Materials”) contain all information with respect to the Issuer and the Notes which is material in the context of the issue and offering of the Notes (including all information required by applicable laws and regulations of Malaysia and the information which, having regard to the particular nature of the Issuer and the Notes, is necessary to enable the investors and their investment advisers to make an informed assessment of the assets and liabilities, financial position, profit and losses, and prospects of the Issuer and of the rights attaching to the Notes), (ii) all the information contained in the Offering Materials, will be true and accurate in all material respects and not misleading, (iii) the opinions and intentions expressed in the Offering Materials will be honestly held, will have

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WOORI BANK Principal terms and conditions of the MTN Programme

been reached after considering all relevant circumstances and will have been based on reasonable assumptions, (iv) there will be no other facts, the omissions of which would, in the context of the issue and offering of the Notes, make the Offering Materials as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect, and (v) all reasonable enquiries will have been made by the Issuer to ascertain such facts and verify the accuracy of all such information and statements; (g) Financial Statements: the audited financial statements of the Issuer are prepared in accordance with Korean GAAP, consistently applied through the periods involved and they present fairly and accurately in all material respects the results of operations, cash flows and the financial position of the Issuer, as at the respective dates indicated therein, and the results of operations and changes in financial position of the Issuer for the periods in respect of which they have been prepared; (h) Material change: there has been no change nor any development or event that could involve a change in the business or condition (financial or otherwise) of the Issuer or any principal subsidiary since the date of its last audited financial statements which might have a material adverse effect; (i) Events of Default: there exists no event or circumstance which is or could, with the passing of time, the giving of notice, the making of any determination, or any combination thereof, constitute an Event of Default; (j) Dissolution: no step has been taken by the Issuer or its shareholders nor have any legal proceedings been started or threatened for the winding up or dissolution of the Issuer; or for the appointment of a receiver, trustee or similar officer of the Issuer or its assets;

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WOORI BANK Principal terms and conditions of the MTN Programme

and (k) Others: such other representation and warranties as may be reasonably advised by any of the Solicitors and agreed with the Issuer. (v)

Events of default

:

Events of default shall include: (a) a default is made for more than 7 days in the payment of any principal due in respect of any of the Notes; or (b) a default is made for more than 14 days in the payment of any amount, other than principal, in respect of any of the Notes; or (c) a default is made by the Issuer in the performance or observance of any terms and conditions and obligation (other than a payment obligation) under the Transaction Documents and the Notes, and (except where such default is not capable of remedy, when no such notice shall be required), such default shall continue for 30 days after written notice requiring such default to be remedied shall have been given to the Issuer by the Trustee; or (d) any other notes, debentures, bonds or other indebtedness having an aggregate principal amount of of at least U.S.$10,000,000 (or its equivalent in any other currency) or more of the Issuer or any principal subsidiary shall become prematurely repayable following a default in respect of the terms thereof, or steps are taken to enforce any security therefor, or the Issuer or any principal subsidiary defaults in the repayment of any such indebtedness at the maturity thereof (or at the expiration of any applicable grace period therefor, if any), or any guarantee of or indemnity in respect of any such indebtedness of others given by the Issuer or any principal subsidiary shall not be honoured when due and called upon in accordance with its terms; or (e) a resolution is passed or an order of a

9

WOORI BANK Principal terms and conditions of the MTN Programme

court of competent jurisdiction is made that the Issuer be wound up or dissolved, otherwise than for the purposes of or pursuant to and followed by a consolidation, amalgamation, merger or reconstruction, the terms of which shall have previously been approved in writing by an extraordinary resolution of a meeting of the holders of the Notes; or (f) a resolution is passed or an order of a court of competent jurisdiction is made for the winding up or dissolution of any principal subsidiary, except (a) for the purposes of or pursuant to and followed by a consolidation or amalgamation with or merger into the Issuer or any other subsidiary, (b) for the purposes of or pursuant to and followed by a consolidation, amalgamation, merger or reconstruction (other than as described in (a) above) the terms of which shall have previously been approved in writing by an extraordinary resolution of a meeting of the holders of the Notes, or (c) by way of a voluntary winding-up or dissolution where there are surplus assets in such principal subsidiary and such surplus assets attributable to the Issuer and/or any other subsidiary are distributed on a pro-rata basis to the Issuer and/or any such other subsidiary; or (g) an encumbrancer takes possession or a receiver is appointed of the whole or a substantial part of the assets or undertaking of the Issuer or any principal subsidiary; or (h) a distress, execution or other legal process is levied or enforced upon or sued out against a part of the property of the Issuer or any principal subsidiary which is material in its effect upon the operations of the Issuer or such principal subsidiary (as the case may be) and is not discharged within 45 days thereof; or (i) the Issuer or any principal subsidiary (a) stops payment (within the meaning of Korean or any other applicable bankruptcy law), or (b) (otherwise than for

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WOORI BANK Principal terms and conditions of the MTN Programme

the purposes of such a consolidation, amalgamation, merger, reconstruction or voluntary solvent winding up or dissolution as is referred to in (e) or (f) above) ceases or through an official action of the Board of Directors of the Issuer or such principal subsidiary (as the case may be) threatens to cease to carry on business, or (c) is unable to pay its debts as and when they fall due; or (j) proceedings shall have been initiated against the Issuer or any principal subsidiary under any applicable bankruptcy, reorganisation or insolvency law and such proceedings shall not have been discharged or stayed within a period of 60 days; or (k) the Issuer or any principal subsidiary shall initiate or consent to proceedings relating to itself under any applicable bankruptcy, reorganisation or insolvency law, or the Issuer or any principal subsidiary convenes a meeting of its creditors (or any class of them) or commences negotiations with its creditors (or any class of them) with a view to the readjustment or rescheduling or deferral of its indebtedness, or proposes or makes any arrangement (including any scheme of arrangement or composition) with its creditors (or any class of them), or makes a general assignment for the benefit of or a composition with its creditors (or any class of them), or a moratorium is agreed or declared by a court of competent jurisdiction in respect of or affecting all or any party of its indebtedness; or (l) any consent, authorization, licence, approval or registration with or declaration to governmental or public bodies or authorities or courts (where applicable) required by the Issuer to authorize or required by the Issuer in connection with the execution, issue, delivery, validity, legality, enforceability or admissibility in evidence of any of the Transaction Documents or the performance by the Issuer of its obligations under the Notes or any of the Transaction Documents or to

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WOORI BANK Principal terms and conditions of the MTN Programme

carry out its business, as the case may be, is modified and has a material adverse effect, or is not approved or is revoked or has expired or is withheld or is not renewed or otherwise ceases to be in full force and effect; (m) such other Events of Default as may be reasonably advised by the Lead Arranger’s Malaysian Counsel and agreed with the Issuer. Upon the occurrence of any event of default, the Trustee may and shall (if so directed by the holders of the Notes in accordance with the terms of the Trust Deed) declare the Notes immediately due and payable and thereafter to exercise such rights and powers in accordance with the terms of the Trust Deed and/or the other Transaction Documents. :

Not applicable

(w)

Principal terms and conditions for warrants (where applicable)

(x)

Other principal terms and conditions for the issue (i)

Covenants

:

The usual and customary for a transaction of such nature, which shall include but not limited to the following: (a) the Issuer shall at all times perform its obligations and promptly comply with all provisions under the Transaction Documents and the terms and conditions of the Notes; (b) the Issuer shall redeem in full all outstanding Notes in accordance with the terms and conditions under the Transaction Documents; (c) the Issuer shall at all times provide the Trustee, such information as it requires in order to discharge its duties, obligations, powers, trusts, authorities and discretions vested in it as trustee under the Trust Deed relating to the Issuer’s affairs, to the extent permitted by law upon prior reasonable notice;

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WOORI BANK Principal terms and conditions of the MTN Programme

(d) the Issuer shall at all times exercise reasonable diligence (without negligence or misconduct) in carrying out its business in a proper and efficient manner, and preserve and keep in force and effect, all licenses, consents and rights necessary for the conduct of its business; (e) the Issuer shall: (i) at all times maintain a paying agent with a specified office in Kuala Lumpur and use its best endeavours to procure that the paying agent observes and complies with its obligations under the Transaction Documents, including but not limited to notifying the Trustee in the event the paying agent does not receive payment from the Issuer on the due dates; and (ii) not make any modifications/amendments to the Depository and Paying Agency Agreement, except in the manner provided in the Depository and Paying Agency Agreement; (f)

the Issuer shall at all times keep proper financial books and accounts and, subject, however, to any restrictions under applicable laws and regulations, provide the Trustee and any person appointed by the Trustee, access to such books and accounts;

(g) the Issuer shall immediately notify the Trustee in the event that the Issuer becomes aware of the following: (i) of any actual or potential Event of Default or such other right or remedy under the terms, provisions and covenants of the Notes and the Transaction Documents which have become immediately enforceable; (ii) of any circumstance that has occurred that would materially prejudice the Issuer or any security for the Notes (if applicable) or the Notes or the

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WOORI BANK Principal terms and conditions of the MTN Programme

Transaction Documents; (iii) of any substantial change in the nature of the business of the Issuer; (iv) of any change in the withholding tax position or taxing jurisdiction of the Issuer (where applicable); (v) of any change in the utilisation of proceeds from the Notes, other than for the purpose stipulated in the Transaction Documents; and (vi) of any other matter that may materially prejudice the interest of holders of the Notes; (h) the Issuer shall immediately take such steps following the occurrence of an Event of Default to remedy or mitigate the effect of that Event of Default; (i)

the Issuer provide to the Trustee, within 120 days after the end of its financial year, its annual audited accounts; and within 60 days after the end of each half of its financial year, its unaudited condensed interim financial statement; and any other accounts, report, notice, statement or circular issued to its shareholders for the period;

(j)

the Issuer shall not enter into a transaction, whether directly or indirectly with interested persons (including a director, substantial shareholder or persons connected with the Issuer) unless: (i) such transaction shall be on terms which are no less favourable to the Issuer than those which could have been obtained in a comparable transaction from persons who are not interested persons; and (ii) with respect to transactions involving an aggregate payment or value equal to or greater than a sum to be agreed between the Issuer and the Lead Arranger, the Issuer obtains

14

WOORI BANK Principal terms and conditions of the MTN Programme

certification from an independent adviser that the transaction is carried out on fair and reasonable terms; PROVIDED that the Issuer certifies to the Trustee that the transaction complies with paragraph (j)(i) above, that the Issuer has received the certification referred to in paragraph (j)(ii) (where applicable) and that the transaction has been approved by the majority of the board of directors or shareholders in a general meeting, as the case may require; (k) the Issuer shall provide the Trustee at least annually, a certificate that the Issuer has complied with its obligations under the Trust Deed and the terms and conditions of the Notes and that there did not exist or had not existed any event of default and if such is not the case, to specify the same; (l)

the Issuer shall comply with all relevant applicable laws and regulatory requirements;

(m) the Issuer shall, so far as required by law, at all times, execute all such further agreements and do all such further acts and things as may be necessary at any time or times to give effect to the terms and conditions under the Transaction Documents and Information Memorandum; and (n) such other covenants deemed necessary or as may be reasonably advised by any of the Solicitors and agreed with the Issuer. (ii)

Negative Pledge

:

So long as any of the Notes remains outstanding, the Issuer will not create or permit to be outstanding any mortgage, charge, pledge or other security interest upon the whole or part of its property, assets or revenues, present or future, to secure for the benefit of the holders of any International Investment Securities (as defined below), (i) payment of any sum due in respect of any such securities, or (ii) any payment under any guarantee of any such securities, or (iii) any

15

WOORI BANK Principal terms and conditions of the MTN Programme

payment under any indemnity or other like obligation relating to any such securities, without in any such case, at the same time according to the Notes, either the same security as is granted to or is outstanding in respect of such International Investment Securities, guarantee, indemnity or other like obligation or such other security as shall be approved by an extraordinary resolution passed at a meeting of the holders of the Notes. For the purpose hereof, “International Investment Securities” means notes, debentures, bonds or investment securities of the Issuer which: (a) either are by their terms payable, or confer a right to receive payment, in any currency other than Won or are denominated in Won and more than 50 per cent. of the aggregate principal amount thereof is initially distributed outside Korea by or with the authorisation of the Issuer; and (b) are for the time being, or are intended to be, quoted, listed, ordinarily dealt in or traded on any stock exchange or over-thecounter or other securities market outside Korea. (iii)

Availability Period

:

From the date of completion of all documentation and compliance with the Conditions Precedent stated above to the date falling 10 years from the date of first issue under the Programme.

(iv)

Status of Notes

:

The Notes will constitute direct, unconditional, unsubordinated and, subject to the provision on Negative Pledge above, unsecured obligations of the Issuer, and will rank pari passu, without any preference amongst themselves, and equally with all other present and future unsecured and unsubordinated obligations of the Issuer, except those obligations preferred by law.

(v)

Redemption

:

Unless previously purchased by the Issuer and cancelled, the Notes shall be redeemed on their maturity dates at 100% of their par value.

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WOORI BANK Principal terms and conditions of the MTN Programme

(vi)

Purchases

(vii) Transaction Documents

:

The Issuer may at any time purchase the Notes in the open market at any price or by private treaty. Any such Notes purchased may be cancelled at the option of the Issuer.

:

The Notes shall be evidenced inter-alia, by: 1. 2. 3. 4.

(viii) Taxation

:

Programme Agreement; Trust Deed; Depository and Paying Agency Agreement; and any other documentations as reasonably advised by any of the Solicitors and agreed with the Issuer.

All payments by the Issuer shall be made without withholding or deductions for or on account of any present or future tax, duty or charge of whatsoever nature imposed or levied by or on behalf of Korea or any political subdivision having power to tax or any other applicable jurisdictions, or any authority thereof or therein having power to tax, unless such withholding or deduction is required by law. In such event, the Issuer will pay such additional amounts as shall be necessary in order that the net amounts received by the holders of the Notes after such withholding or deduction shall equal the respective amounts of principal and interest (if any) which would otherwise have been receivable in respect of the Notes, in the absence of such withholding or deduction; except that no such additional amounts shall be payable with respect to any Note, under certain circumstances (if any) to be advised by the Issuer’s Korean Counsel.

(ix)

Governing Law

:

The laws of Malaysia.

(x)

Jurisdiction

:

The Issuer shall unconditionally and irrevocably submit to the non-exclusive jurisdiction of the courts of Malaysia.

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