This paper provides detailed accounts of the Korean banks’ debt restructuring process in the first half of 1998. This event deserves our attention not only because it significantly relieved the Korean economy of its immediate shortages of foreign exchange, but also because it provided a turning point from which the Korean economy started to regain foreign investors’ confidence, and thus to overcome the crisis. Reflection upon this event also has a special meaning at the time of writing as Korean banks have recently repaid in full the debts that had been extended up to three years in early 1998.