This chapter addresses the question of whether Korea and Taiwan had voluntary domestic incentives for adoption of the Accord, through a comprehensive analysis of the two countries banking regulations. Once the Basel Accord was established it diffused rapidly to non-Basel Committee member countries including Korea and Taiwan, even though they had no formal obligations to adopt it. Korea's bank regulatory authority, the Office of Bank Supervision (OBS), was in contrast located in the central bank, the Bank of Korea (BOK), up until the time of establishment of a new financial regulatory authority, the Financial Supervisory Commission (FSC), following the 1997 financial crisis. The OBS was in principle legally independent of the Ministry of Finance. In practice it was subordinate to the ministry, however, and the regulatory institutional framework hindered Korean bank regulators in attaching any priority to prudential regulation, including capital adequacy regulation. However, the Korean government placed its top priority during the country's economic development on growth.