In response to the adverse development due to the economic crisis of 1997, the Korean government initiated economy wide restructuring in 1998. The economic restructuring drive has been underpinned by what may be called the "four plus one" approach. The "four" means comprehensive restructuring and reforms in the financial, corporate, public and labor sectors. The "plus one" represents the strong commitment of the Korean government to market opening, particularly the liberalization of the capital market and the promotion of foreign direct investment. As of today, assessments vary for the progress and the impact on the national welfare of each of the five restructuring and reforms. However, as far as the financial restructuring is concerned, the consensus view seems to evaluate the Korean case favorably, as the financial system has recovered soundness and back to normal functioning. Given the development, the purpose of this paper is to explain the modality of the financial sector structuring in Korea, to appraise the outcome and to identify economic factors responsible for the outcome.