If a bank fails, how much of my deposit is protected?

The most common misunderstanding is that each account or each branch is protected up to 100 million won. In fact, all deposits and installment savings at the same financial institution are added together, and the total is protected up to 100 million won. If you have three accounts at one bank holding 30, 40 and 50 million won, only 100 million of the 120 million won total is protected.

At different banks, the limits count separately. With 90 million won at Bank A and 80 million won at Bank B, both amounts are fully within protection. Splitting money across branches of the same bank does not raise the limit.

Interest is included in the protected amount, but not necessarily at the rate you were promised. It is calculated at whichever is lower: the rate agreed when you signed up, or a rate set by the Korea Deposit Insurance Corporation. For banks and savings banks, that benchmark is the average rate on one-year time deposits at commercial banks.

The part above 100 million won does not simply vanish. In bankruptcy proceedings you can share what remains of the bank's assets with other creditors, but how much you get back, and when, is not fixed.

Protection covers products that promise to return your principal. Deposits and installment savings at banks and savings banks, surrender values of insurance policies, and cash deposited in brokerage accounts all fall into this group. Products whose payout depends on investment results, such as funds, are not protected even if you signed up at a bank counter.

Retirement pensions (DC and IRP types) and pension savings are each protected up to 100 million won separately from ordinary deposits, even at the same bank. Saemaeul Geumgo, credit unions and local Nonghyup cooperatives are protected not by the Korea Deposit Insurance Corporation but by their own central associations' funds, with the same 100 million won limit. The deposit protection notice printed on a bankbook or product description tells you which applies.