Samsung Futures Annual Report Value Creator

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1 Samsung Futures Annual Report 2008 Value Creator Samsung Futures Inc. 7th FL., Samsung Yeouido Bldg. 36-1, Yeouido-dong, Yeongdengpo-gu, Seoul, Korea Tel`:`82`-`2`-`783`-`2020 / Fax`:`82`-``2`-``761`-``6138

2 Contents 02_ Contents 04_ We put clients interests first 06_ We are shaping the world 08_ We develop lasting relationships built on trust 10_ Financial Highlights 12_ Message from the CEO 14_ Review of Operation 16_ International Sales and Trading Team 18_ Global Financial Futures Team 20_ Global Commodities Team 22_ Institutional Marketing Team 23_ Research Team 24_ Compliance Team and Settlement Team 25_ IT Team 26_ Board of Directors & Business at a Glance 27_ Financial Review 28_ Balance Sheets 29_ Statements of Income

3 Value The greatest value for Samsung Futures is consumer satisfaction. Creator Samsung Futures is creating the highest value building on its market leading services and advanced investment systems. Samsung Futures philosophy on value and its competitive edge differentiates it as a genuine professional.

4 Develop Samsung Futures own specialized Services MANAGEMENT PLAN 2008 Expand into new markets Strategic improvements and investments in infrastructure Always All For Customers

5 We put your interests first at all times. Samsung Futures is moving forward under the banner of consumer satisfaction. The most reliable brand of consumer satisfaction is generated by experts with extensive experience and by guaranteeing transparent soundness. The future of our costumers is always our priority.

6 Advance cyber marketing tools Complete customer-focused transaction system PROMOTE DIGITAL MANAGEMENT ENVIRONMENT Establish management information system STRATEGY FOR SYSTEM ESTABLISHMENT Always Leading Professional

7 We are shaping the world. Samsung Futures services and systems have served as the standard in the market Optimal services and infrastructure are offered based on a system tailored to the global investment environment and a flexible business mind which can promptly reflect customer needs. The creative business of Samsung Futures will drive new developments.

8 Always With you

Samsung Futures Samsung Securities Samsung Life Insurance Samsung Investment Trust Management Samsung Fire and Marine Insurance Samsung Card Samsung Venture Investment We develop lasting

9 Samsung Futures Samsung Securities Samsung Life Insurance Samsung Investment Trust Management Samsung Fire and Marine Insurance Samsung Card Samsung Venture Investment We develop lasting relationships built on trust. As part of the Samsung Financial Group which leads the local financial market, Samsung Futures has nurtured a great sense of pride and sharp competitiveness. Even at the top, we will not become complacent but continue to innovate and be your reliable partner for life.

10 FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS In million KR won Operating revenues Operating expenses Operating income Income taxes Net income ,104 34,265 28,722 29,288 20,732 18,288 22,816 13,533 10,434 6,414 3,785 3,013 16,486 9,737 7,364 Total assets 530, , ,955 Total liabilities 463, , ,461 Total shareholders equity Adjusted net capital ratio 66,718 52,732 45, % 205% 246% ASSETS In billion KR won CAPITAL 67 In billion KR won

11 SAMSUNG FUTURES ANNUAL REPORT 2008 BROKERAGE COMMISSIONS BREAKDOWN Securities 11.6% Banks 50.6% 2007 M/S 18.3% Foreigners 11.4% Individuals 1.1% Others 4.4% Insurers 2.1% ITC 18.8% REVENUES In billion KR won DEPOSITS In billion KR won 1,

12 MESSAGE FROM THE CEO MESSAGE FROM THE CEO

12 +13 SAMSUNG FUTURES ANNUAL REPORT 2008 Dear Shareholders and Clients, I d like to express sincere gratitude for your interest and commitment that led to much progress and growth during the past

This led to improved quality of consulting and services. We have introduced diverse products from world s major exchanges.

13 SAMSUNG FUTURES ANNUAL REPORT 2008 Dear Shareholders and Clients, I d like to express sincere gratitude for your interest and commitment that led to much progress and growth during the past year. We have strived to achieve continuous changes to fully satisfy your expectations. We have hired highly talented experts with global competency. This led to improved quality of consulting and services. We have introduced diverse products from world s major exchanges. For clients convenience, we have consolidated domestic and global futures in our system. We have created tailored systems for individual clients with enhanced speed and service. In our research team, we provided broad perspectives in global markets and commodities in addition to the bonds and currencies. Second, we will expand our business into new markets. We will increase your investment choices by introducing more products from diverse exchanges. It will diversify our earnings. Moreover, we will be ready to introduce new activities such as OTC market derivative products following the capital market consolidation Management Plan 2008 will become one of the most important year for financial market players. Capital market consolidation act to become effective in February 2009 will lead to broad changes in financial markets and reorganize the financial businesses. We are not afraid of the change and anticipated confusion. To turn this into an opportunity for making progress, we will focus on the following three actions getting ready for the market reorganization. First, we will develop our own specialized services as a financial investment firm. First priority for 2008 is to gain a competitive edge by client service improvements. We will evolve our system to tailor to clients needs. Business in back offices will be enhanced for transaction efficiency. We will increase research staff to provide balanced and differentiated views. Improved communications will be accomplished through events and on-site client visits. Finally, we will make strategic improvements and investments in infrastructure. Long term strategic improvements and investment in infrastructure is necessary to meet the needs for the market, clients, and the management environment. We are getting ready for global financial infrastructure. We will enhance global financial business network and build the organization, system, business model to meet 24-hour transaction systems. Shareholders and clients, Please continue to stay with us and watch us transformed. Your criticism and encouragements are always welcome. We at Samsung Futures will work hard to exceed your expectations in President and CEO Thank you.

14 REVIEW OF OPERATION INTERNATIONAL SALES & TRADING TEAM GLOBAL FINANCIAL FUTURES TEAM GLOBAL COMMODITIES TEAM INSTITUTIONAL MARKETING TEAM RESEARCH TEAM COMPLIANCE TEAM SETTLEMENT TEAM IT TEAM

15 Samsung Futures leads the era of scientific investment. Top experts in each area seek to meet clients needs. Differentiated services create our unique value. In-house research system ensures the state of art in financial research.we are the one to turn to in uncertain markets.

REVIEW OF OPERATION International Sales & Trading Team INTERNATIONAL SALES & TRADING TEAM We introduce international clients to domestic policies and regulations.

International Sales and Trading Team introduces Korean derivatives products, policies and regulations, and provides institutional brokerage services to global investors.

16 REVIEW OF OPERATION International Sales & Trading Team INTERNATIONAL SALES & TRADING TEAM We introduce international clients to domestic policies and regulations. Starting from opening accounts to transactions, our support ensures convenience and efficiency. International Sales and Trading Team introduces Korean derivatives products, policies and regulations, and provides institutional brokerage services to global investors. With respect to CFTC approval of KOSPI 200 futures and options, and the globalization of Korean financial markets, interest of foreign investors in Korean derivatives market is growing. International Sales and Trading Team introduces Korean derivatives products, policies and regulations, and provides institutional brokerage services to global investors such as investment banks and hedge funds. We ensure our service convenience and efficiency. Going forward, we have implemented the IT infrastructure including ORC, PAT, GL, BB, and FIX to meet clients system requirements. For a faster speed, we also provide direct connection service such as PAMS and DIMS developed inhouse. For clients without the IT infrastructure, an internet trading system is available with English language support.

17 SAMSUNG FUTURES ANNUAL REPORT 2008

18 REVIEW OF OPERATION Global Financial Futures Team

18 +19 SAMSUNG FUTURES ANNUAL REPORT 2008 GLOBAL FINANCIAL FUTURES TEAM Samsung Futures provides global futures brokerage and global market information services as well as offering on-line futures

Global Financial Futures Team provides global futures brokerage and global market information services for banks, stock brokerage firms, and asset management firms and fund firms.

Providing brokerage services for all futures products listed in the international exchanges and additional services enable us to focus on analyzing global market needs and providing the optimal

19 SAMSUNG FUTURES ANNUAL REPORT 2008 GLOBAL FINANCIAL FUTURES TEAM Samsung Futures provides global futures brokerage and global market information services as well as offering on-line futures brokerage for financial and individual clients. Global Financial Futures Team provides global futures brokerage and global market information services for banks, stock brokerage firms, and asset management firms and fund firms. On-line futures brokerage services for financial and individual clients are also offered. Providing brokerage services for all futures products listed in the international exchanges and additional services enable us to focus on analyzing global market needs and providing the optimal derivative products for institutional clients. Specifically, FuturesNet Plus, our own electronic trading system for global futures products, connects our clients to global exchanges throughout the world, Samsung Futures prides in offering the most in Korea (ex. CME, EUREX, LIFFE, ICE, LME, SGX, HKEx, TSE, OSE, etc). Besides that, we also provide realtime quotes, and supply diverse products meeting institutional clients needs. We strive for client satisfaction and higher returns.

REVIEW OF OPERATION Global Commodities Team GLOBAL COMMODITIES TEAM Samsung Futures has expanded the market base focusing on global offline

Global Commodities Team has expanded business starting from global off-line products, mainly base metals, and built client relationship by

For the first time in Korea, we have introduced LME Plus which provides real time quotes for base metals.

20 REVIEW OF OPERATION Global Commodities Team GLOBAL COMMODITIES TEAM Samsung Futures has expanded the market base focusing on global offline commodities. Our differentiated services such as LME Plus earned us recognition as global commodities experts. Global Commodities Team has expanded business starting from global off-line products, mainly base metals, and built client relationship by educating clients, giving seminars and providing market analysis events on base metals. For the first time in Korea, we have introduced LME Plus which provides real time quotes for base metals. Our differentiated services have earned us recognition as global commodities experts. In 2008, we plan to expand our business to such global markets as precious metals and FFA markets. We are prepared to enter into new markets and will provide services exceeding clients expectations.

21 SAMSUNG FUTURES ANNUAL REPORT 2008

REVIEW OF OPERATION Institutional Marketing Team / Research Team INSTITUTIONAL MARKETING TEAM Separately specializing on fixed income and currency

Samsung Futures Institutional Marketing Team provides comprehensive specialized consulting and services.

Each team consists of highly skilled experts.

22 REVIEW OF OPERATION Institutional Marketing Team / Research Team INSTITUTIONAL MARKETING TEAM Separately specializing on fixed income and currency products, Samsung Futures highly experienced experts provide institutions with top quality consulting and services. Samsung Futures Institutional Marketing Team provides comprehensive specialized consulting and services. Team 1 and 2 focus on interest rate products such as 3yr KTB and 10yr KTB whereas Team 3 and 4 focus on currencies such as US Dollars, Euro and Yen. Each team consists of highly skilled experts. Our services ranging from individual product forecasts, investment transactions, and execution to follow-up are becoming increasingly complex and specialized. Thus, Institutional Marketing Team provides increasingly diversified products and services including speedy and accurate order executions, market analysis on index and currency ETD as well as OTC.

22 +23 SAMSUNG FUTURES ANNUAL REPORT 2008 RESEARCH TEAM Fulfilling the increasing research needs for global investment environments, Samsung Futures will expand our global market coverage

We publish regular market broadcast and issue papers on domestic derivative products such as Korean treasury bond futures, currency futures, stock index futures/options and international

We will generate investment ideas by designing diverse trading strategies on domestic and international derivative products.

23 SAMSUNG FUTURES ANNUAL REPORT 2008 RESEARCH TEAM Fulfilling the increasing research needs for global investment environments, Samsung Futures will expand our global market coverage and satisfy the need for market information and investment opportunities. We publish regular market broadcast and issue papers on domestic derivative products such as Korean treasury bond futures, currency futures, stock index futures/options and international financial and commodities market. We will expand our coverage to global markets to meet the increasing research needs for global investment opportunities. We will generate investment ideas by designing diverse trading strategies on domestic and international derivative products. Furthermore we will analyze earnings of domestic and international derivative firms and help fine-tune your portfolios. Additionally, we supply market trend information through seminar invitations, onsite presentations and media, maintaining a close relationship with clients. Increasing client satisfaction with our research services, we fulfill the clients needs for market information and investment opportunities.

REVIEW OF OPERATION Compliance Team & Settlement Team, IT Team COMPLIANCE TEAM Samsung Futures strives for highest standards of ethical behavior and transparent business culture.

Establishing an internal monitoring system for preventing financial crimes also became an important management component.

Further, we established a system for monitoring business activities of the staff based on the internal control standards.

24 REVIEW OF OPERATION Compliance Team & Settlement Team, IT Team COMPLIANCE TEAM Samsung Futures strives for highest standards of ethical behavior and transparent business culture. Recent volatility in financial industry calls for highest standards of ethical behavior and fiduciary responsibility. Establishing an internal monitoring system for preventing financial crimes also became an important management component. Thus, we established the code of conducts and Samsung management principles and practice them for transparent business culture. Further, we established a system for monitoring business activities of the staff based on the internal control standards. We work on prevention, countermeasure and monitoring of unfair or unlawful trades. SETTLEMENT TEAM Samsung Futures settlement service puts clients first and tries our best for your satisfaction. Settlement services that include asset management, transaction management and follow-up are as important as front marketing in our business. Samsung Futures settlement service puts clients first at all times. Through frequent customer service education, innovations and paperless office activities, we strive for clients satisfaction.

24 +25 SAMSUNG FUTURES ANNUAL REPORT 2008 IT TEAM IT is becoming a critical component of financial industry.

25 SAMSUNG FUTURES ANNUAL REPORT 2008 IT TEAM IT is becoming a critical component of financial industry. Samsung Futures IT systems are evolving daily to meet the changing requirements of finance industry. Samsung Futures transaction system, Futures Net Plus is Korea s first system consolidating domestic and global futures. It lists all products listed in Korea Futures Exchange (KRX) as well as products in world s major exchanges, CME, CBOT, LME, EUREX, TSE, SGX, HKEx, etc. The number of products is increasing as we speak. Our system supports a variety of chart analysis and is being continually upgrading to guarantee fast and secure transactions. State-of-art high performance server replaced the existing server and network equipments in All the server and network equipments have redundancy to ensure the best capacity and reliability. With high-quality hardware and software, Samsung Futures provides differentiated tailored services to clients. We support automatic trading system for programs such as Excel. We also support large-volume market maker with in-house solutions such as PAMS and DIMS and using international solution providers including ORC, PATS, GL, etc.

FINANCIAL REVIEW BOARD OF DIRECTORS Myung-Hoon Oh President and CEO Gwang-Nam Lee Senior Executive Managing Director International & Domestic Business Division Kyung-Whee Kim Managing

etc Stocks Currencies Interest rates Energy Precious metals Industrial metals etc KOSPI200 Futures, KOSPI200 Options, KOSDAQ STAR Index Futures, Individual Stock Option, Individual Stock

(planned listing), Whole Futures/Option Products S&P500, NASDAQ100, NIKKEI225, Mini Dow, DAX, DJ Euro Stoxx50, Hang Seng, H-Share, TOPIX Euro, Yen, Swiss Franc, British Pound, Canadian

Heating Oil, Natural Gas, Gasoline Gold, Silver, Platinum, Palladium Electrolytic copper, Aluminum, Zinc, Lead, Nickel, Tin Agricultural and Meat products: Soybeans, Wheat, Corn, Coffee,

26 FINANCIAL REVIEW BOARD OF DIRECTORS Myung-Hoon Oh President and CEO Gwang-Nam Lee Senior Executive Managing Director International & Domestic Business Division Kyung-Whee Kim Managing Director Business Management Division Sang-Yool Lee Managing Director Business Division BUSINESS AT A GLANCE PRODUCTS DOMESTIC FUTURES INTERNATIONAL FUTURES Stocks Currencies Interest rates etc Stocks Currencies Interest rates Energy Precious metals Industrial metals etc KOSPI200 Futures, KOSPI200 Options, KOSDAQ STAR Index Futures, Individual Stock Option, Individual Stock Futures, US Dollar Futures, Japanese Yen Futures, Euro Futures, Korean Treasury Bond Futures (3-year, 5-year, 10-year), Monetary Stabilization Bond (MSB) Interest Rate Futures Pork Futures (planned listing), Whole Futures/Option Products S&P500, NASDAQ100, NIKKEI225, Mini Dow, DAX, DJ Euro Stoxx50, Hang Seng, H-Share, TOPIX Euro, Yen, Swiss Franc, British Pound, Canadian Dollar, Korean Won, Chinese Yuan 30-year US treasury bonds, 10-year US treasury notes, Eurodollar, 10-year Japanese treasury bonds, Euro-Bund, Long Gilt, Euro-BOBL, Euro-SCHATZ Crude oil, Heating Oil, Natural Gas, Gasoline Gold, Silver, Platinum, Palladium Electrolytic copper, Aluminum, Zinc, Lead, Nickel, Tin Agricultural and Meat products: Soybeans, Wheat, Corn, Coffee, Sugarcane, Raw cotton, Cattle, Pork, Cocoa, Frozen Orange Juice, Wood, Frozen Pork Bellies Shipping and Freight Rate Index MAJOR EXCHANGES CME, CBOT, LME, NYMEX, EUREX, SGX, NYBOT, OSE, HKEx, TSE, COMEX, etc

27 SAMSUNG FUTURES ANNUAL REPORT 2008 FINANCIAL REVIEW BALANCE SHEETS STATEMENTS OF INCOME

28 FINANCIAL REVIEW BALANCE SHEETS In millions of KRW FY'07 FY'06 FY'05 ASSETS I. Cash and due from banks II. Deposits III. Securities 1. Available-for-sale securities 2.Held-to-maturities securities IV. Loans V. Property and equipment (Accumulated depreciation) Vehicles Furniture and fixtures VI. Other assets 1.Accounts receivable 2.Accrued income 3.Prepaid expenses 4.Guarantee deposits 5.Collective funds for default loss 6.Intangible assets 7.Others ( Allowance for doubtful accounts ) Total assets 1,168 1,067 1, , , ,507 42,939 38,109 27,772 3,000 3,000 3,000 39,939 35,109 24,772 1,478 1,058 1, (964) (3,070) (2,836) ,826 3,748 3,119 15,935 12,518 9, ,210 3,683 2, ,160 4,489 4, ,752 3,661 2,095 (62) (74) (27) 530, , ,955 STOCKHOLDERS' EQUITY AND LIABILITIES I. Liabilities 1. Customers' marginal deposits 2. Other liabilities (1) Retirement and severance benefits (2) Transfer to National Pension Fund (3) Pension plan assets (4) Severance benefits insurance deposit (5) Others II. Stockholders' equity 1. Common stock 2. Retained earnings Total stockholders' equity and liabilities 463, , , , , ,993 7,042 3,718 4,468 1,569 1,346 1,136 (4 ) (5 ) (5) (1,565 ) (1,290) (672) 7,042 3,667 4,009 66,718 52,732 45,495 25,000 25,000 25,000 41,718 27,732 20, , , ,955

29 SAMSUNG FUTURES ANNUAL REPORT 2008 STATEMENTS OF INCOME In millions of KRW FY'07 FY'06 FY'05 I. Operating revenues 1. Brokerage commissions 2. Gain on derivatives transactions 3. Interest income 4. Gain on foreign currency transactions 5. Other operating revenues 52,104 34,265 28,722 29,409 18,265 19, ,423 15,913 9, II. Operating expenses 1. Brokerage fees 2. Loss on sales of trading securities 3. Loss on derivatives transactions 4. Interest expense 5. Loss on foreign currency transactions 6. General and administrative expenses a. Personnel expenses b. Rent c. Entertainment d. Depreciation e. Amortization f. Taxes and dues g. Advertising h. Travel i. Communications and electronic data processing j. Events k. Commission and fees l. Printing m. Vehicle n. Conference o. Others 7. Other operating expenses 29,288 20,732 18,288 6,031 2,956 2, ,190 4,566 3, ,818 12,962 12,362 11,254 8,116 7, ,832 1,808 1, III. Operating income IV. Non-operating income V. Non-operating expenses VI. Income before income tax VII. Income tax VIII. Net income 22,816 13,533 10, ,900 13,522 10,377 6,414 3,785 3,013 16,486 9,737 7,364

30 Samsung Futures Inc. 7th FL., Samsung Yeouido Bldg. 36-1, Yeouido-dong, Yeongdengpo-gu, Seoul, Korea Tel`:`82`-`2`-`783`-`2020 / Fax`:`82`-``2`-``761`-``6138

BURSA MALAYSIA DERIVATIVES BERHAD

BURSA MALAYSIA DERIVATIVES BERHAD Date : 2 February 2011 Trading Participant Circular : 4/2011 AMENDMENT TO THE RULES OF BURSA MALAYSIA DERIVATIVES BERHAD ( RULES OF BURSA DERIVATIVES ) IN RELATION TO