The prompt corrective action (PCA) system was introduced for the first time in Denmark in 1994 when CBSBA was enacted. The USA also introduced the System in 1991 in order to deal with a lot of troubled depository institutions by the Federal Deposit Insurance Corporation Improvement Act (FDICIA) of 1991. The PCA system of USA has been a successful and desirable model for many other countries. Korea introduced the PCA system in 1992 by the Monetary and Financial Operation Committee in the Bank of Korea as a prudential regulatory measure for the banking institutions. Just before the Financial and Currency Crisis in 1997, the System was implemented very well for the financial institutions such as banks, securities companies, and insurance companies. During the Crisis, the PCA system carried out the important role of restructuring measures for the many troubled financial institutions. Afterwards, the Korean PCA system has been reformed and improved gradually. Recently the System has played an important role in restructuring the troubled mutual savings banks in Korea. However, there are still some areas to be reformed and improved in order that the Korean PCA system works more properly and efficiently. This paper suggests three points. First, the purpose of the Korean PCA includes to minimize the possibility of putting the Public Fund into troubled financial institutions. Second, the forbearance (suspension) of the PCA should be abolished. Third, the power of the Financial Services Commission on the PCA should be checked by the Korea Deposit Insurance Corporation which manages deposit insurance funds in Korea.