425 - Resolution on Merger of KCC

Filed by Kookmin Bank

Pursuant to Rule 425 under the Securities Act of 1933


Subject Companies:             Kookmin Bank

(Exchange Act file number 1-15258)


These materials contain certain statements that are neither reported financial results nor other historical information. These statements are forward-looking statements within the meaning of the safe-harbor provisions of the U.S. federal securities laws. Because these forward-looking statements are subject to risks and uncertainties, actual future results may differ materially from those expressed in or implied by the statements. Many of these risks and uncertainties relate to factors that are beyond Kookmin Bank’s ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behavior of other market participants, the actions of governmental regulators and other risk factors detailed in Kookmin Bank’s reports filed with the Securities and Exchange Commission (the “Commission”). Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of these materials. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of these materials.


Investors and security holders are advised to read any prospectus required to be filed with the Commission regarding the potential business combination transaction between Kookmin Bank and Kookmin Credit Card. If required, a prospectus will be filed with the Commission either by Kookmin Bank, Kookmin Credit Card or a newly formed corporation. Security holders may obtain a free copy of such prospectus (if required and when available) and other related documents filed by Kookmin Bank, Kookmin Credit Card and/or such newly formed corporation at the Commission’s public reference room located at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the public reference room. If required and when available, the prospectus and other documents may also be obtained from Kookmin Bank by contacting Kookmin Bank, Investor Relations Team, 36-3 Yoido-dong, Youngdeungpo-ku, Seoul 150-758, Korea.


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The following materials were released by Kookmin Bank on May 30, 2003.


Resolution on Merger with Kookmin Credit Card Co.


On May 30, 2003, the board of directors of Kookmin Bank passed a resolution on the merger between Kookmin Bank and Kookmin Credit Card Co. as follows:


Description of merger


Acquiror: Kookmin Bank

Target: Kookmin Credit Card Co.

Purpose of merger


This merger will:

– create a unified credit card business unit through which Kookmin Bank can further enhance its credit card business by focusing on growth potential and maximizing management efficiency; and

– enable Kookmin Bank to strengthen its competitiveness in the credit card business by enabling it to flexibly respond to the dynamics of the changing market environment, efficiently allocate its resources and reduce costs.

Merger ratio and basis for calculation


Merger ratio:

Kookmin Bank 0.442983: Kookmin Credit Card 1


Basis for calculation:

(1) In connection with the merger of Kookmin Bank with Kookmin Credit Card, the merger ratio was calculated pursuant to Article 36-12 of Enforcement Regulation of the Korean Securities and Exchange Act and Article 84-7 of Enforcement Decree of the Korean Securities and Exchange Act.

(2) The base stock price was calculated based on the lesser of (x) the arithmetic average of (i) the closing stock price on May 29, 2003, (ii) the weighted average closing stock price for the one week period ending May 29, 2003, and (iii) the weighted average closing stock price for the one month period ending May 29, 2003 and (y) the closing stock price on May 29, 2003.

Base stock price: Kookmin Bank KRW31,780; Kookmin Credit Card KRW14,078

Merger ratio with respect to common shares: Kookmin Bank 0.442983: Kookmin Credit Card 1

Class and number of new shares to be distributed at the time of merger


Common shares




Preferred shares









Details of acquiror after merger


Name of company


Kookmin Bank


Name of representative


Jung-Tae Kim


Paid-in capital (KRW)




Total number of shares outstanding




Par value of shares (KRW)




Business area


Banking activities permitted pursuant to the Bank Act of Korea and other banking related regulations.


Location of head office


9-1, 2-Ga, Namdaemun-Ro, Jung-Gu, Seoul, Korea 100-703

Registration date for merger


October 2, 2003

Record date for dividend of new shares


January 1, 2003

Effective date of merger


September 30, 2003

Date of Kookmin Bank shareholders meeting for merger approval


Not applicable

Period of creditors’ formal objection


August 19, 2003 through September 18, 2003

Date of merger agreement


May 30, 2003


Appraisal right of dissenting shareholders of Kookmin Bank:


Kookmin Bank shareholders have no appraisal rights in a small-scale merger.


Pursuant to Article 527-3 of the Korean Commercial Code relating to small-scale mergers, the approval of the merger may be obtained by the board of directors instead of by shareholders meeting. However, if the shareholders of Kookmin Bank holding more than 20/100 of the total number of issued and outstanding shares of Kookmin Bank dissent to the merger, the shareholders of Kookmin Bank must approve the merger at a shareholders meeting.


Resolution date (date of board resolution on May 30, 2003)

    attendance of non-executive directors: 7 of 12
    attendance of auditor: present


    Details of acquired company


Name of company


Kookmin Credit Card Co.

Name of representative


Bong–Hwan Cho

Total assets (KRW million)



Paid-in capital (KRW million)



Sales (KRW million)



Number of outstanding shares



Relationship with company


Subsidiary of Kookmin Bank

Merger ratio



Business areas


Business activities relating to:

1. the Specialized Credit Financial Business Act of 1997, as amended;

2. the credit card business and lending business;

3. telemarketing;

4. insurance and travel services;

5. the issuance of credit cards;

6. the distribution of printed matter relating to the credit card business;

7. property leasing;

8. enrolling members with respect to certain programs;

9. internet and other forms of electronic marketing; and

10. other activities with respect to those described above.