SAMSUNG SECURITIES REPORT 2013

Inspired by

CLIENTS

Client-oriented Management

[NOUN] 1. FOCUS on serving clients with solutions tailored to individual needs and integrating it into business model 2. Commitment to devote our PASSION in helping clients thrive with fundamental reform in organizational culture

3. Pursuit of mutual success with clients as a reliable partner based on long-term TRUST relationship

About Samsung Securities

Client-oriented Management 01

Letter from the CEO 08

Management Team 11

Company Profile 12

Business Overview 15

Sustainable Management

Our Stakeholders & Issues 22

Corporate Responsibility 24

Corporate Governance 25

Risk Management 27

Ethical Management 30

Customer Satisfaction 31

For the Employees 33

For the Community 36

Financial Performance 39

Overview 40

Business Performance 41

Risk and Capital Adequacy 45

Financial Information 48

Appendix 59

Significance of the ReportEvery year, Samsung Securities shares information about its management performance, business strategies, and sustainable management activities with its stakeholders through the production of an in-depth report.

Reporting PeriodThis report covers the periods from April 1, 2013 to December 31, 2013 (expressed as FY 2013) and January 1, 2013 to December 31, 2013. It includes data from the past three years whenever it has been deemed to be necessary for the understanding of business trends. It also contains some qualitative data that includes activities during the first half of 2014.

Scope of ReportingThis report covers activities at our headquarters, domestic branches, and overseas subsidiaries. Our overseas operations have been excluded from the discussion of environmental data due to the difficulty in collecting them.

Reporting Principles and AssuranceThis report has been prepared in accordance with the Global Reporting Initiative G3.1 Guidelines and the GRI Financial Services Sector Supplement. Its contents have been assured independently by a third-party entity. Details regarding the GRI guidelines and the assurance information are both outlined in the index on pages 62-65 and pages 60-61 respectively.

Samsung Securities is the first South Korean financial company to be listed in the Financial Services sector of the Dow Jones Sustainability Index World, also known as DJSI World.

Samsung Securities is a signatory to the Carbon Disclosure Project, or CDP. We encourage other firms in South Korea to participate in this.

Samsung Securities is committed to putting its toppriority on clients by redoubling its emphasison client-oriented management.

In 2014, we will address five key issues focused on client-oriented management. They include:

FOCUS inspired by Clients

Samsung Securities Report 2013 Client-oriented Management 02.03

- Align financial advice with client investment goals- Provide sufficient and thorough information about investment products- Offer consistent after-sales service for customer satisfaction- Strive for professionalism as wealth manager- Reflect client interests in financial advisor evaluations and compensation

Samsung Securities Report 2013 Client-oriented Management 04.05

Samsung Securities is committed to enhancingclients’ financial well-being.

We always put our clients’ needs first. In order to provide our clients with best-in-class financial products, we screen financial products exhaustively through our Product Selection Committee. We will also reflect clients’ return on investment as a key performance indicator for financial advisors. Our focus on clients will also be recognized by introducing a performance-based fee structure to a wider range of financial products and services.

PASSION inspired by Clients

TRUST inspired by Clients

Samsung Securities Report 2013 Client-oriented Management 06.07

Samsung Securities does not only concentrate on selling financial products, but also on strengthening clients' trust through consistent after-sales management activities.

We offer our clients a full range of information regarding market trends and strategies through both regular and special after-sales reports on all our recommended products. We also provide optimized follow-up service through our company-wide Client Management Committee.

In 2013, we had to contend with recession amid continuing uncertainties in the world

economy such as slowing growth in China, the possibility of US tapering its quantitative

easing. The average daily trading value of South Korea’s stock market fell to the KRW 5

trillion (half of its 2011 high), while the value of the domestic fund market remained stable

at 2007 pre-crisis level of KRW 330 trillion. More than a third of South Korean securities

brokers recorded losses and many were put up for sale.

Regardless of our effort to attract client assets and reduce expenses, FY 2013 net revenue

and net profit recorded KRW 557.9 billion and KRW 11.0 billion, respectively as brokerage

commission and bond sales dropped.

Despite this challenging environment, we firmly believe that corporate responsibility plays

a crucial role in our long-term success as a business and as a partner to our clients. We

therefore strive to incorporate social responsibilities into every aspect of our work and

maintain a prudent taking of risk in line with our strategic priorities.

Our social contribution activities, carried out by 123 volunteer teams across the country,

are designed to meet the needs of the communities in which we operate. We also in-

creased our caring and sharing projects, such as providing free retirement planning and

no-cost donation consulting services. These activities have proven to be a major means of

enhancing our leadership in the area of sustainable management. Last year, we became

the only company in the domestic financial industry to be confirmed as a member of Dow

Jones Sustainability Index World for the fourth consecutive year.

In 2014, despite a gradual recovery in the global economy, South Korea is likely to contin-

ue experiencing low growth due to weak consumer demand and continued sluggishness

in the real estate sector.

We expect competition in the stock market to intensify as securities brokers increase their

focus on selling products on mobile platforms and trading-value growth remains low. The

introduction of fund supermarkets will also present challenges for the financial products

market, while the securities industry as a whole will likely see more alliances and mergers.

Client assets (In trillions of KRW)

117.5HNWI clients (Thousand persons)

80 Kim SukPresident and Chief Executive Officer

“Samsung Securities will consolidate its position as South Korea’s leading securities firm by realigning its management system for clients to understand that they are our highest priority. We also intend to develop a number of new growth engines.”

Samsung Securities Report 2013 Letter from the CEO 08.09

We believe, however, that strongly capitalized banks with a clear and demonstrated client

focus will have a competitive advantage.

Here at Samsung Securities, client-oriented management remains our highest priority. We

will concentrate on building client trust by making dramatic innovations to our organizational

culture, business systems, and operating processes. These will include strengthening our

expertise in private banking, increasing head office assistance for clients, and enhancing

online systems and contents. These steps will help us secure a stable revenue base by

attracting new clients and increasing the value of their assets.

We will also focus on the implementation of our integrated bank strategy on increasing the

market share in wealth management and strengthening our competitiveness in future growth

drivers, such as corporate lending and prime brokerage.

In the face of stagnant markets, our integrated business model will adjust to achieve resilient

and sustainable long-term growth via continuing cost reduction and enhancing productivity

through process innovation.

We will also make efforts to provide the right developmental opportunities based on

individual and organizational needs for our employees. Besides prudent approach to

employee strategy, we firmly believe that corporate responsibility plays a crucial role in our

long-term success as a business. We therefore endeavor to incorporate our approach into

activities including “Dream-maru,” an economy class for youth, and “YAHO” community

service team.

Although we expect the market environment will remain uncertain in 2014, Samsung

Securities will do its utmost to maintain its position as the leading South Korean financial

player, committed to achieve strong, safe, and continuous growth that will ensure our clients’

trust. Rather than to blame such a challenging environment, we will stay firm, facing the

future with a belief in the value of creativity, innovation, and confidence.

We would like to sincerely thank all our clients, shareholders, employees, and other

stakeholders at all levels for their exceptional contributions and continued support.

Yours sincerely,

> 3

> 1

> 2

>1. Kim Nam Soo, Executive Vice President and Head of Management Support Division >2. Yun Seok, Executive Vice President and Head of Wholesale Division >3. Lee Sang Dae, Executive Vice President and Head of Retail Division

Samsung Securities Report 2013 Management Team 10.11

Kim SukPresident and Chief Executive Officer

Samsung Securities has always been a pioneer in the development of the capital market in South Korea, achieving industry-leading securities firm title and acquiring several industry records in the process—including being the first to sell mutual funds and equity-linked securities, and establish client assets over KRW 100 trillion. We are also recognized at home and abroad as a trendsetter in customer satisfaction, sustainable management, and management excellence.

Awards and Accolades in 2013

History

Business Milestones

1982Established as Hanil Investment & Finance

1988Issued IPO on Korea Exchange

1998First South Korean securities firm to sell mutual funds

1991Changed company name to Kookje Securities 1992Incorporated into Samsung Group 1996Established Samsung Securities Europe in London1998Established Samsung Securities America in New York City

Samsung Securities Value Statement proclamation ceremony

Introduced Next Generation System, similar to those of high-quality international financial corporations

Transferred Shanghai representative office to Beijing

2003Changed business model to wealth management2004First securities firm to sell ELS (Equity Linked Securities) 2005Designated all sales staff as private bankers (PB) 2008Established strategic alliance with Rothschild2009Announced new brand management

Changed Tokyo representative office to branch

Launched “SNI,” a premium brand for UHNWI clients

Retail client assets surpassed KRW 100 trillion, the first in South Korea

Net revenues surpassed KRW 1 trillion

Declared “Empathy 36.5” customer satisfaction campaign

Launched Samsung POP Golden Egg Account and sales surpassed KRW 1 trillion

First securities firm to obtain “AA+ (Stable)” rating from Korea Investors Service

Increased capital2000Merged with Samsung Investment Trust and Securities2001Established Samsung Securities Asia in Hong Kong2002Opened Shanghai representative office2009Raised capital in Samsung Securities Asia

Began offering post-retirement wealth management services at all branches

1982~ 2011~1990~ 2012~2000~ 2013~2010~

Customer Satisfaction• Ranked first in Securities category in Korean

Customer Satisfaction Index survey conducted by Korea Management Association Consulting for eighth consecutive year

• Ranked first in Korea Standard Service Quality Index survey conducted by Korea Standards Association for sixth consecutive year

• Ranked first in National Customer Satisfaction Index survey conducted by Korea Productivity Center for

eighth consecutive year• Ranked first in Securities category in Korean Net Promoter Score survey conducted by KMA Consulting for seventh consecutive year • Won grand prize in Customer Satisfaction category at Aju Business Daily Securities Awards

Sustainable Management• Best company in Financial Services Sector of DJSI Korea for fifth consecutive year • Listed in Financial Services Sector of DJSI Asia Pacific for fourth consecutive year• Listed in Financial Services Sector of DJSI World for fourth consecutive year, the first for a South Korean financial company

Management Excellence • Named Best Securities House by Maeil Business Newspaper• Won grand prize in Wealth Management category at 2013 Herald Business Capital Market Awards • Won first prize at 2013 Korea Securities Awards from

Seoul Economic Daily• Won first prize in Wealth Management category at Asia

Capital Investment Awards from Asia Business Daily

Brand• Ranked first in Securities category in Korea Brand Power

Index survey conducted by KMA Consulting for fifteenth consecutive year (for Samsung Securities POP)

• Ranked first in Securities category in National Brand Competitiveness Index survey conducted by Korea Productivity Center for tenth consecutive year

Research and IB• Awarded grand prize at 2012 Best Report of Korea Awards

from Money Today (for Samsung Small-Cap Team) • Won “Deal of the Year” award at tenth Korea IB Awards by

Money Today • Ranked first in evaluation of research centers by Herald Business

Key Indicators

Total assets (In trillions of KRW)

FY 2003

6.3 20.5FY 2013

Net capital ratio (%)

FY 2003

369 636FY 2013

HNWI assets (In trillions of KRW)

FY 2003

17.9 59.4FY 2013

* Clients with deposits of KRW 100 million or more

Samsung Securities Report 2013 Company Profile 12.13

Business Overview

Wealth Management

Sales & Trading

Investment Banking

Financial Highlight Consolidated Separate

Balance Sheet Summary Total assetsTotal liabilitiesTotal equityTotal equity (controlling interest)

Earnings Summary Net revenue Brokerage commissions Salescommissionsonfinancialinstruments Underwriting and advisory fees Trading and interest income Other Commission expensesOperating expenses Personnel expenses Depreciation Selling, general, and administrative expensesNon-operating incomePretax incomeIncome tax expensesNetprofitNetprofit(controllinginterest)

Financial ratios and common share dataReturn on equity (controlling interest)Return on assetsEarnings per share (in KRW)Diluted EPS (in KRW)Dividend per share (in KRW)

Client assets (In trillions of KRW)Company basisReporting basis

Personnel and branches Number of employees NumberoffinancialadvisorsNumber of domestic branches

FY 2013

20,535.617,098.4

3,437.23,295.8

557.9211.0279.8

24.0 37.918.5

[13.4]519.2268.3

37.2213.6

[3.0]35.711.624.011.0

0.4%0.1% 148 148 650

117.5 185.5

3,132 1,032

98

FY 2012

19,480.915,998.43,482.53,342.7

965.6302.8333.529.6

297.821.1

[19.3]728.0382.348.6

297.1[4.7]

232.852.1

180.7163.7

5.0%0.9%

2,200 2,200

700

116.5 185.0

3,476 1,141

105

YoY Change (%)

+5.4%+6.9%-1.3%-1.4%

-42.2%-30.3%-16.1%-18.9%

-87.3%-12.2%-30.7%-28.7%-29.8%-23.4%-28.1%

- -84.7%-77.6%-86.7%-93.3%

-4.5%p-0.8%p-93.3%-93.3%

-7.1%

+0.9%+0.3%

-9.9%-9.6%-6.7%

FY 2012

18,382.515,065.8

3,316.73,316.7

780.1271.4206.8

29.5 264.5

37.5[29.7]601.4313.5

43.2244.7

[9.0]169.6

39.1130.6130.6

4.0%0.8%

1,755 1,755

700

116.5 183.5

3,116 1,141

105

FY 2013

19,505.016,232.3

3,272.73,272.7

430.9188.8179.7

24.025.633.9

[21.1]423.7215.0

33.4175.3

1.68.80.48.48.4

0.3%0.1% 113 113 650

117.5 184.1

2,773 1,032

98

YoY Change (%)

+6.1%+7.7%-1.3%-1.3%

-44.8%-30.4%-13.1%-18.8%-90.3%

-9.5%-28.8%-29.6%-31.4%-22.8%-28.4%

- -94.8%-98.9%-93.6%-93.6%

-3.6%p-0.7%p-93.6%-93.6%

-7.1%

+0.9%+0.3%

-11.0%-9.6%-6.7%

*Netrevenuereferstooperatingincomeafterfinancialfees,tradingcommissions,andKoreaFinancialInvestmentAssociationmembershipfeeshavebeendeducted.

FY 2013 Economic Value Trends (Separate) (In billions of KRW)

(In billions of KRW)

Non-operating income

2.4 Depreciation

33.4

Subcontractors

66.6 Other operating expenses

28.8 Landlord

31.9 Government

0.4 Media

13.0

Local communities/NGOs

0.8

Shareholders

7.4

Internal reserves

0.9 Insurance

3.7

Interagency

28.0

Net revenue

430.9

Employees

218.3

Netprofit

8.4

(Excluding donations) (Insurance premiums) (Donations)

(Dividends)(Miscellaneous expenses)

(Rental costs) (Utility costs) (Corporate taxes) (Advertising expenses)(Wages, pensions, employeebenefit

expenses and training costs)

Samsung Securities Report 2013 14.15

Our wealth managment services are designed to meet the varying needs of each and every client. It includes a broad assortment of investment options, such as equities, bonds, and funds, all of which are available through our network of branch, online, and call center channels.

In 2013, Samsung Securities recorded YoY declines in sales and income due to reduced trading values and commission rates. Despite this, our number of clients with deposits in excess of KRW 100 million rose. We also increased our market dominance in the high-profit offline stock brokerage sector.

In 2014, we will achieve mutually beneficial growth with our satisfied clients by emphasizing the need for client-oriented operations. This will include offering them a broad range of wealth manage-ment financial instruments from both home and abroad that will ensure an enhanced rate of return on their investments. We will also maximize our clients’ level of satisfaction by developing more on-line and offline sales models, and make improvements to our private banker training programs.

Samsung Securities launched its SNI service in 2010 by making enhancements to its already-exist-ing private banking services. It evolved into an organization that is exclusively dedicated to offering our UHNWI clients the ultimate in wealth management services and solutions in 2012.

SNI’s clients enjoy a wide range of custom-tailored wealth management services, led by a team of private bankers who work exclusively with our UHNWI clients. We also established an SNI Advisory Group consisting of specialists in such areas as investment strategies, legal matters, taxation, and real estate.

Samsung Securities’ leadership in the increasingly competitive UHNWI market is a result of the com-prehensive range of custom-tailored services that we are able to offer in the area of individualized wealth management. In 2014, we will offer our UHNWI clients an even greater choice of services and products.

Wealth ManagementThe leader in client-oriented wealth management

Samsung Securities boasts a highly qualified team of financial advisors with the expertise and experience needed to provide clients with a wide range of financial products to help them thrive. We are dedicated to pursue success in line with clients' investment goals via sound and consistent risk management system.

The SNI service offers UHNWI clients the finest wealth management solutions and services designed by our highly professional team of private bankers. It features a broad range of specialized products and continuing commitment to long-term client relations management.

Long/Short Funds and Hedge FundsThese refer to the funds that offer stable earnings through such means as domestic equity long/short and arbitrage trading utilizing stock index futures. They are designed for investors wishing to realize higher earnings than market interest rates.

Global Asset Allocation FundsThese funds offer clients a high rate of return through the purchase of a broad range of global equities and bonds. Their performance is due in large part to our in-depth knowledge regarding economic outlooks, currency values, and government policies.

POP Unified Managed Account ServiceThis is a one-on-one customized advisory service in which our financial specialists offer their clients individualized portfolios consisting of both domestic and overseas assets. It includes a free rebalancing option whenever economic conditions change.

Total Care ProgramThis provides WM services to clients and their families in such areas as inheritances, successions, and family business inheritances. It also offers business owners a host of integrated financial solutions for their corporate funds and employee retirement pensions.

Dual Care ServiceOffered by our Advisory Group, this service goes beyond our regular PB services by analyzing our SNI clients’ portfolios and offering them in-depth investment solutions.

Noble Care ServiceThis highly sophisticated program helps to satisfy the lifestyle needs of our SNI clients in such leisure and entertainment areas as culture and the arts.

SNI, leading ultra high net worth individual market in South Korea

Samsung Securities Report 2013 Business Overview 16.17

Sales & Trading Investment Banking

Samsung Securities capitalizes on its strengths in research and analysis to offer domestic and foreign institutional investors a full range of services in the areas of equities, bonds, and derivatives. We seek both profitability and stability by coping with changes in the market and practicing enhanced risk management.

Samsung Securities delivers institutional clients a distinct value proposition by combining innovative and integrated solutions with a structured advisory process to create sustainable added value.

Our Sales & Trading operations include (a) Wholesale, which offers a wide range of financial prod-ucts, such as equities and derivatives, to domestic and overseas institutional investors and cor-porate clients; (b) Prime Brokerage, which offers such services as capital introduction, securities lending and margin loan for the more efficient management of hedge funds; and (c) Trading, which utilizes our equity capital efficiently and effectively and also manufactures structured products.

The Wholesale business sells foreign-currency bonds and securities derivatives. It also deals in equities, futures, and options. The prime brokerage business is a leader in the stock lending and equity swap markets, backed by the largest retail clients. The Trading sector supports sales for both individual and institutional clients by launching new products with various underlying assets and structures. It is also expanding its revenue bases in the product-linked management area, including ELS and DLS.

In 2014, the Wholesale business will add to its profitability by offering high-level research services in the stock brokerage area and a host of company-linking services, such as global and outbound conferences. It will also offer a large selection of product lineups, including overseas PEFs and se-curitized derivatives. The Prime Brokerage business will respond to market changes with the dereg-ulation of hedge funds. It will also invigorate the hedge fund market by increasing its L&B pool and developing a number of prime-quality management companies.

Our IB business assists clients in such areas as equity capital market, debt capital market, and M&A advice regarding acquisitions, sell-offs, and mergers. We also offer a solutions provider service for asset-backed securities, real asset funds, and real estate project financing. In addition, we carry out principal investments, including pre-IPO investments, assistance with M&A financing, and corporate loans.

We boast an extensive network of domestic and overseas issuers and investors, a team of highly professional human resources, an enviable reputation for solid and secure capitalization, and indus-try-leading risk management abilities. Besides being the first South Korean player to issue Shogun Bonds, we have a long history of cross-border transactions and government deals.

In 2014 we will revamp our SP operations, including asset securitization both at home and abroad and overseas project financing. We will also diversify our revenue bases by enhancing our new corporate lending and PEF businesses. In addition, we will continue to provide a wide range of busi-ness restructuring solutions, and offer a wider range of investment opportunities to individual and institutional clients through IPOs, real asset funds, and real estate funds.

Providing a wide range of customized solutions Partnering in the growth of our corporate clients

Samsung Securities Report 2013 Business Overview 18.19

Stock BrokerageWe assist both domestic and overseas institutional clients that are interested in investing in South Korean companies with insightful research, corporate access, best efforts execution, algorithm trading, and other key services.

Derivatives Brokerage This service develops environments to which various investment strategies can be applied. Its features include an independently developed Customized DMA System and ETF AP, and LP services (including arbitrage trading).

Hedge Fund SystemOur hedge fund system’s management tools and supports include analyses of transactions and positions, credit granting, secured transactions and current status, portfolio risk management, and a host of simulations.

IPOWe offer a broad array of IPO solutions to corporate clients, such as cross listings both at home and abroad. We boast the nation’s largest global institutional investor network and research center, and an excellent individual client base.

M&AsWe provide a full range of M&A advisory services, including underwriting finance. They are backed by our long-term experience in executing cross-border M&As, as well as our strategic partnership with Rothschild.

Real Asset FundsThis service offers clients a full menu of alternative investment products that are based on domestic and overseas projects and a wide range of real assets, such as oil fields, ships, and real estate holdings.

1.

2.

Corporate Governance 25

Risk Management 27

Ethical Management 30

Customer Satisfaction 31

For the Employees 33

For the Community 36

Overview 40

Business Performance 41

Risk and Capital Adequacy 45

Financial Information 48

Financial Performance

Corporate Responsibility

SU

ST

AIN

AB

LE

MA

NA

GE

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What makes us

sustainable?Samsung Securities is committed to mutually beneficial

long-term growth with all its stakeholders. This includes our

corporate responsibilities as well as our financial performance.

Samsung Securities Report 2013 Sustainable Management 20.21

Our Stakeholders & Issues Samsung Securities is committed to creating value for its stakeholders.

We identify the needs of stakeholders by each group through ongoing communications,

and reflect feedback in our management activities.

We are fostering client-oriented management through ongoing communication with our clientele.

Clients

We outline management results and strategies, and discuss important operating issues at our general shareholders' meeting and through a wide range of other communication channels.

Shareholders

We follow all governmental rules and regulations to the letter, and maintain mutually beneficial partnerships with our business partners and industry-related institutions.

Government Agencies and Business Partners

We contribute to the development of the communities in which we operate through a variety of social contribution activities and investment programs.

Community and NGOs

We carry out a broad array of initiatives as a responsible corporate citizen to help future generations live happy and healthy.

Future Generations

We hire talented human resources through open and honest recruitment processes and offer them specialized training and a broad range of employee benefits.

Employees

Improvement to sound corporate governance practices

Enhancement of risk management processes

Demand for open and ethical management

Protection of clients' rights and interests

Creation of a healthier organizational culture

Contribution to local communities

Corporate Responsibility

MARKETPLACE

ENVIRONMENT

Government Agencies and

Business Partners

EmployeesFuture Generations

Clients Improvement of customer satisfaction,

Information security

VOC,

Customer satisfaction

survey

YAHO,

Youth Economy &

Securities AcademyYouth education, Green management

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Compliance with rules and regulations,

Ethical management

Public hearing,

Seminar

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Multidimensional

evaluation

Equitable personnel management,

Diverse training and benefits

programs

Shareho

lders'

meeting

, IR activity

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Samsung Securities

CO

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WORKPLACE

Our Stakeholders

Stakeholders Issues in 2013

Channels

Needs

>> >> >>

Materiality Assessment

Relevance and materiality assessment: Conducted

through workshops with the eighteen teams in the

company’s Sustainable Management Council

Stakeholder survey: Utilize separate channels for

each stakeholder group

Study of related companies: Review reports

published by other financial industry players, both

domestic and international

Media analysis: Review news releases dealing with

Samsung Securities over the past three years

Analysis of business environment and operational capabilities: Review changes in marketplace and

assess operational capabilities

Diagnosis of CSR level: Utilize DJSI 2013

questionnaires and GRI 3.1 guidelines

Analysis of Internal and External Environments

Transparency o

f manag

ement,

Enhancem

ent of shareho

lder value

Shareho

lders

Samsung Securities Report 2013 Our Stakeholders & Issues 22.23

Business performance reviews

Sales performance by segment

Key risk management indicators

Financial Performance

CORPORATE RESPONSIBILITY

1.

Samsung Securities fulfills its corporate social

responsibilities by contributing to the sound

growth of the capital market and earning the

trust of its stakeholders.

Our various sustainable growth activities

include sound corporate governance,

intensive risk management, ethical

management, CS programs, employee

assistance and benefits, contributing to

the communities in which we operate,

and “green” finance.

Advanced corporate governance through shared responsibilitiesOur Corporate Governance Charter divides responsibility for cor-porate decision-making among our general shareholders' meet-ing, the BOD, and our auditor.

The Chair of our BOD is appointed from our outside directors. He or she is guaranteed complete independence from outside influ-ences. We also hold an annual general shareholders' meeting as a means of sharing responsibility. The Audit Committee supervises the company's management independently of large shareholders and the BOD.

Board composition and activities The members of our BOD are chosen for their independent out-looks and their decision-making skills, as well as their expertise and reputations. The BOD operates six subcommittees to ensure a transparent and efficient decision-making process. Outside di-rectors participate in both subcommittee and BOD meetings.

The Board of Directors consists of three standing/executive direc-tors and four outside directors nominated by shareholders at an annual general shareholders’ meeting. It decides on important management issues as defined by any laws or the company's articles of incorporation, as well as matters that have been en-trusted to it at a general shareholders’ meeting.

Resolutions require a majority vote by BOD members and those attending a general shareholder’s meeting, unless otherwise re-quired by law. The voting rights of members with vested interests are restricted to ensure a transparent decision-making process. In 2006, Samsung Securities began appointing an outside director as the Chair of its BOD to guarantee openness and fairness in its activities.

The BOD meets on a quarterly basis and calls extraordinary meet-ings whenever there are resolutions requiring a vote or issues that need to be reported to it. It met eight times in 2013. Its duties included receiving briefings on the company’s quarterly earnings results. It also passed twenty resolutions.

The BOD’s activities in 2013 included strengthening the com-pany’s compliance system relating to sales. This included modify-ing its business practice systems and processes and revising its internal controls to prevent conflicts of interest. It also approved ceilings on equity- and derivative-linked bonds to boost sales.

CompensationOur executives’ level of pay is directly linked to how well they meet key performance indicators and management goals every year. The level of compensation for our BOD directors, outside directors, and members of the Audit Committee are made public in our business reports.

External evaluations of our corporate governance activities In 2013, we were awarded our tenth consecutive Very Satisfactory rating in the annual Environmental, Social, and Governance evalu-ations conducted by the Korea Corporate Governance Service. We also won an “A” rating in the Governance category for the third straight year. In addition, we were included in the KRX SRI Gover-nance Index by the Korea Exchange for the tenth year in a row.

Corporate Governance

Samsung Securities is committed to sound corporate governance.

Key Issues Discussed at BOD Meetings in 2013

February 22, 2013

April 23, 2013

May 10, 2013

June 7, 2013

July 18, 2013

August 29, 2013

October 11, 2013

November 14, 2013

Approval of ceilings on asset backed short-term bond issuances

Approval of financial statements and sales report

Approval of convening annual meeting of shareholders

Appointment of Chair of BOD

Subscription to corporate bond stabilization fund

Revision of BOD and Internal Transaction Committee regulations

Revision to internal control standards

Approval of transaction limits involving large shareholders

Dates held

1

3

3

2

1

3

3

4

Issues voted on Major issues

Board Meetings over the Past Three Years

2011 2012 2013

10

96%

8

97%

8

96%

Number of meetings held

Attendance rate of members

Co

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rate Resp

onsib

ilityFinancial P

erform

ance

Corp

orate Governance

Risk M

anagement

Ethical M

anagement

Custom

er Satisfaction

For the Em

ployees

For the Com

munity

Samsung Securities Report 2013 Corporate Responsibility 24.25

Subcommittees of the board of directorsThe BOD has six subcommittees: Audit Committee, Management Committee, Outside Director Recommendation Committee, Risk Management Committee, Remuneration Committee, and Inter-nal Transaction Committee. This expedites its decision-making processes and enhances the efficiency of its activities. The BOD decides upon the establishment and makeup of each subcom-mittee. The subcommittees make recommendations on issues delegated to them by the BOD.

The Management Committee consists of two standing directors. It deals with issues that require speedy decision-making, and rou-tine matters delegated to it by the BOD. It met ten times in 2013, dealing with such issues as the opening, transfer, and/or closing of branches, and changes in branch managers.

The Audit Committee oversees the company’s overall operations, supervises the BOD, and evaluates the company’s internal con-trol systems. At least two-thirds of its members must be outside directors, with one of them chairing the Committee. The com-mittee can request information regarding operation of the com-pany, attendance of executives at the meeting, secure storage of confidential materials, accumulation of data for external auditing, etc. The committee convened quarterly during 2013 with the at-tendance of all members.

Some of the Committee’s main activities included receiving regular briefings on the company’s internal audit activities and the internal control activities of the Compliance Officer. It also produced an audit of the company’s business report and its thirty-second-term financial statements, and also carried out an annual evaluation of its

internal accounting control systems. To ensure the independence of external auditors, the committee also scrutinizes the auditors' non-financial business operations.

Establishing a committee for recommending outside directors is mandatory for all domestic securities firms with assets over KRW 2 trillion. The committee is responsible for selecting, examin-ing, and recommending qualified outside director candidates to shareholders. At Samsung Securities, the committee comprises five members, including the CEO. It recommends candidates for outside director positions prior to their appointments at an annual general shareholders’ meeting. At least half of its members must be outside directors. One new outside director was appointed at the general shareholders’ meeting in 2013.

The Risk Management Committee comprises two executive direc-tors and one outside director. It is tasked with establishing the company’s risk management policies. The committee met four times in 2013.

The Remuneration Committee is composed of one executive director and two outside directors. It reviews the appropriateness of the company’s compensation levels for its executives and em-ployees. It met five times in 2013.

The goal of the Internal Transaction Committee is to carry out rigorous and objective deliberations regarding the company’s in-ternal workings, and address the concern that large corporations are mainly interested in making deals with their affiliates. To ensure transparency and objectivity, it is made up of three outside direc-tors. It met five times in 2013.

Risk management philosophy Securities businesses are exposed to risks of every description while carrying out their operations and sales and wealth manage-ment activities, and can only generate revenue if risk levels are managed properly. This means that defining and monitoring its risks and keeping them at manageable levels are integral to the successful operation of every player in the financial industry.

Samsung Securities’ risk management system is based on a phi-losophy of rejecting the concept of growth for growth’s sake and maximizing its revenues while keeping its risk levels manageable.

Our “Samsung Securities Risk Management Principles” were created by analyzing a number of failures in risk management, ranging from the 1997 foreign exchange debacle in Asia to the ongoing global financial crisis. They allow us to create added shareholder and client values despite rapid changes to our oper-ating environment.

Integrated risk management system Our risk levels are managed by the Samsung Integrated Risk Intel-ligence System, or SIRIS. It identifies a wide range of risks that we face during our management activities, and analyzes the potential impact of various business activities on the company’s well-being in advance of their actual occurrence.

Our Risk Management Unit plays a leading role in building a com-prehensive risk management system. It analyzes reputational, legal, and financial risk through collaboration among our business divisions and our Compliance, Legal Affairs, and other teams.

Samsung Securities was the first South Korean securities firm to establish a business continuity plan, or BCP. It ensures uninter-rupted service even in the event of geopolitical crises or natural disasters, contributing to our reliability as a financial firm by pro-tecting our assets and those of our clients from operational risks. Fire drills conducted at our head office proved the BCP’s effec-tiveness, as we were able to resume operations within a mere two hours. This allowed us to obtain an ISO 22301 business continuity management certification.

Board of Directors

Executive Directors

Kim SukPresident & CEO, Samsung Securities

Song Kyung ChulMember of Audit Committee, Samsung Securities

Kim Nam SooHead of Management Support Division, Samsung Securities

Outside Directors

Yoo Young Sang (BOD Chairman)Visiting Professor, Department of Mechanical and Aerospace Engineering, Seoul National University

Jun Sam hyunProfessor, College of Law, Soongsil University

Kim Sung JinVisiting Professor, Department of Economics, Seoul National University

Kim Kyung SooProfessor, College of Economics, Sungkyunkwan University

Management Committee

Kim Suk (Chair)

Kim Nam Soo

Audit Committee

Yoo Young Sang (Chair)

Kim Sung Jin, Kim Kyung Soo,

Song Kyung Chul

Outside Director

Recommendation Committee

Kim Suk (Chair)

Kim Nam Soo, Yoo Young Sang,

Kim Sung Jin, Kim Kyung Soo

Risk Management Committee

Kim Suk (Chair)

Kim Nam Soo, Jun Sam Hyun

Remuneration Committee

Kim Suk (Chair)

Yoo Young Sang, Jun Sam Hyun

Internal Transaction Committee

Yoo Young Sang (Chair)

Jun Sam Hyun, Kim Sung Jin

(As of March 14, 2014)

RiskManagement

Samsung Securities delivers shareholders and clients added values through efficient risk management programs and processes.

We follow the risk management principles outlined below in order to ensure our continuing operation as a sound and sustainable securities company.

- We acknowledge that a large part of the profits of a financial business

is created by dealing with risk.

- We do not bear risks that we cannot manage.

- We comply with all rules and regulations governing our operations

without exception.

- We monitor and deal with changes to our risks on a continuous basis.

- We learn from our failures, and do not repeat them.

Samsung Securities Risk Management Principles

Corp

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For the Com

munity

Business Continuity Plan (BCP) Certification

Co

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ance

Samsung Securities Report 2013 Corporate Responsibility 26.27

Risk management and decision-making systemOur decision-making system includes the BOD, Risk Management Committee, and Risk Management Execution Committee. The Risk Management Execution Committee operates a Product Commit-tee and an Investment Acquisition Committee. They allow for risk management-related decision-making by each business division.

Most issues that have been approved by the BOD’s various sub-committees are passed on to the Risk Management Committee and the Management Execution Committee. If additional analyses are needed, these other committees do so, allowing the BOD to manage the firm’s overall risk management operations more efficiently. Meetings are organized simultaneously by different decision-making bodies to ensure prompt communications re-garding risk-related issues and allow for more efficient responses to a rapidly-changing market environment.

Risk management committeeThe Risk Management Committee consists of two registered di-rectors and one outside director. It is responsible for the efficient supervision of the company’s risk-related operations and the es-tablishment of its risk management policies, excluding resolutions by the BOD provided for by the law and its Articles of Association.

The Risk Management Committee has the following responsibilities Develop risk management policy Determine risk appetite Approve risk limits by type Establish, revise, or abolish risk management regulations

Risk management execution committeeThe Committee includes the CEO and the heads of the Retail, Wholesale, IB, Strategic Business, Management Support Divi-sions, as well as an executive in charge of risk management. It establishes detailed risk management strategies and supervises all the company’s risk-related operations.

The Risk Management Execution Committee has the following responsibilities Establish/revise detailed enforcement regulations related to risk Establish/revise operating guidelines for the Investment Acquisition Committee and the Product Committee Corporate risk countermeasuresManage acquisitions/acquisition commitments that exceed a certain level Oversee principal investments that exceed a certain level Grant credit limits to counterparties that exceed their maximum credit Approve exceptions of guidelines set by the Investment Acquisition Committee or the Product Committee Other matters to be referred by the Committee in the operating guidelines of the Investment Acquisition Committee or the Product Committee Adopt new systems to manage risks Other matters related to risk management judged by the Risk Management Department to be referred by the Committee or matters requiring deliberation of the Committee or the Committee Chair

The Product Committee and the Investment Acquisition Commit-tee operate under the aegis of the Risk Management Execution Committee.

Investment acquisition committee The Investment Acquisition Committee is charged with reviewing and approving the acquisition of securities and/or assets at a pre-determined level and/or that are related to trading and investment banking and/or principal investments.

The Committee makes decisions regarding matters in which risk does not exceed a certain level. Issues in which risk does exceed a certain level must be approved by the Risk Management Execu-tion Committee. The Investment Acquisition Committee consists of the head of the Retail Division, the executives in charge of risk management, planning and control, and trading, as well as the heads of the FICC and Institutional Business Units. The lower-level Commitment Committee is comprised of the heads of the com-pany’s business functions. It reviews the transaction structures of acquisitions and/or investments, analyzes their risk factors, and coordinates operations between the various teams that are in-volved in them.

The Investment Acquisition Committee is responsible for the following matters Establishment, revision, and abolition of regulations related to acquisition and investment Principal investments under pre-determined levels Acquisition of IPOs, shares, equity linked securities and commodity-type funds under certain levels Acquisition of fixed income under certain levels Acquisition of real estate PF assets under certain levels and loans related to corporate finance Contract on guaranteed purchases of ABCPs under certain levels Assign limits or increase ceiling of counterparties that exceed a certain level of their credit rating Short-term fund investments under certain levels Adoption of initial investment assets or new investment strategies (new structures or attributes) of the department in charge of asset management

Product committee The Product Committee’s duties include vetting new products, after-sales management, establishing risk management guidelines for products, selecting reputable trading firms, and approving in-ternal control procedures regarding sales.

The Committee includes the heads of the Retail and Strategic Business Divisions, the head of the FICC Business Unit, and executives in charge of trading, risk management, planning and control, and Customer Protection Center. It has a subordinate de-liberation body that is composed of department heads. This body reviews the legality and adequacy of new products and transac-tions and hybrid products including OTC derivatives before they are presented to the Product Committee.

The Product Committee has the following responsibilities Establish, revise, and abolish regulations related to product sales and after-sales management Assign sales limits of investment products if necessary Determine expected sales volume and the launch of new instruments by considering profit and loss objectives and risks Determine whether or not to stop the sales of products with low returns and poor sales Newly designate underlying assets of investment products Select qualified business partners and decide whether or not to terminate business with themManage internal control procedures for sales

Risk management team The Risk Management Team supervises the company’s risk man-agement processes, reports on the status of dubious assets to each committee, and assists them in their ongoing operations. Its independence is ensured by the requirement that the heads and managers of each transaction-related division cannot also head the Risk Management Team or be risk management executives. It also operates a Risk Management Unit that is completely inde-pendent from other divisions in the company. Its organizational placement is directly under the CEO.

The Risk Management Team has the following responsibilities Establish and manage polices, strategies, and management standards related to the company’s risk managementMonitor risks at company level analyze current key issues Establish and revise risk-related regulations, guidelines and transaction rules Run committees related to risk Operate risk management system Inspect risks of new businesses Handle matters delegated by the Risk Management Committee and the Risk Management Executive Committee

Corp

orate Governance

Risk M

anagement

Ethical M

anagement

Custom

er Satisfaction

For the Em

ployees

For the Com

munity

Risk Management Organization

Risk Management Execution Committee

Investment Acquisition Committee

Commitment Committee

Product Committee

Transaction Review Committee

Risk Management Committee

Risk Management Unit

Risk Management Team

BOD

CEO

Co

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ance

Samsung Securities Report 2013 Corporate Responsibility 28.29

Vision statement“Our foremost goals are to increase the value of our clients’ assets and provide comprehensive solutions to all their financial manage-ment concerns.”

Samsung Securities made the above-referenced pledge in Janu-ary 2013, and placed a plaque containing it at the entrances to all its branches. The reason for these actions was to cultivate a client-oriented mindset among our employees, and to demon-strate our commitment to customer satisfaction on a continuous basis. We put our pledge into practice by dealing with complaints from our clients in an in-depth and serious manner. This includes offering them access to a “client healing” service.

Customer satisfaction trainingWe offer our employee a wide range of CS training programs to familiarize them with our policies regarding client-oriented man-agement. These activities also strengthen their client service skill sets. This training is provided on both an individualized and a collective basis. We also operate a number of more specialized educational opportunities to improve the performance of branches and/or employees that have received low client service scores in our regular internal monitoring processes.

Goals of CS Training Create a client-oriented culture by improving the skills sets of all our employees Enhance level of customer service by establishing strict standards at all customer contact points Strengthen partnerships with corporate clients by offering them a wide range of client services

Reflecting clients’ opinions in our operationsWe also reflect the voices of our clients in our management prac-tices. This is done through the operation of a fully-integrated VOC system that can respond to our clients in a fast and efficient man-ner. It ensures that our clients’ opinions and complaints are for-warded from our retail channels, including our website, to a per-son in charge on an immediate basis. In addition, all of the VOCs that we receive are shared with other members of our workforce in real time. VOCs that have been identified as constituting worth-while improvement initiatives are communicated to our employees and clients through our intranet and our homepage.

VOC Business Improvement Process Gather data:Includes issues concerning business or systems

improvements received through VOCs at call cen-ters, branches, head office, or on our homepage

Analyze data:Categorize issues by type of content and client, department(s) involved, and time needed to deal with them

Suggest improvements:Possible improvements suggested by department in charge

Enhance operations:Inform workforce and clients of changes

Examples of Improvements Based on VOC Suggestions 2011:Relaxed requirements for stock allocations in IPOs;

improved client convenience with regard to automatic installment-type transfers and by revamping home trading system; improved ARS functions

2012:Simplified language regarding asset balances and other information; provided transfer service for monthly interest-bearing products; added to convenience of mPOP mobile service; made improvements to real name confirmation process

2013:Enhanced convenience of credit-related operations and POP Express SMS service; made additions to POP investment class; made improvements to HTS functions, including enquiries regarding bond balances

Customer Satisfaction

Employees’ pledge to practice ethical management Samsung Securities’ Code of Ethics contains six values governing the thought processes and behavior of its employees. They are required to sign a pledge to behave in an honest and honorable manner every year. The company has two main priorities: observ-ing all internal and external rules and regulations underlining its operations, and placing the interests of its clients first. As a result, the company was named South Korea’s leading securities firm in the Korea Investors’ Protection Foundation’s Fund Sales Process Evaluation for four years in a row.

Code of Ethics for Samsung Securities EmployeesWe perform our duties honestly and fairly, adhering to the highest standards of ethical conduct.We act in our clients’ best interests, in keeping with our fiduciary duties.We protect shareholder values by generating profits through effective and efficient management. We comply with all applicable laws, regulations, and company regulations, and compete fairly to promote the healthy industry growth.We believe that what is good for the company is good for all, and we will treat each other with the utmost mutual trust and respect.We continue to strive for self-development and enhance our professional financial expertise.

Training in ethical managementAll our employees are offered access to annual online training programs in ethical management and behavior. In addition, our executives participate in collective training. We also conduct an-nual evaluations to measure our employees’ understanding of the meaning and importance of ethical management. Poor performers undergo extra evaluations.

Ethical management internal control systemsWe have instituted a series of internal controls to ensure that we follow fair trade practices and protect our clients from the risk of malfeasance. Our Anti-Money Laundering System classifies clients according to their degree of risk. It also prevents our em-ployees from engaging in money laundering activities by alerting us to suspicious actions in advance. We also monitor unfair trade activities through a Scan System. In 2014, we have introduced mechanisms to tighten our internal controls governing the com-plete sales of financial products, and strengthened our standards for assessing and sanctioning mis-selling.

We have also put an inside and outside reporting and auditing system in place. All of our employees can report instances of wrongful financial practices via the company’s intranet. External stakeholders, including our clients, can do the same by accessing the Ethical Management section of our website.

We have also established a state-of-the-art internal audit system. Our Audit Division analyzes our branches continually, and our business sites daily. It also carries out random audits of specific sections. Any illegal activities are reported to the BOD.

Samsung Securities is dedicated to ensure that we consistently help our clients thrive by integrating individual client’s needs and satisfaction into our business model.

Customer Satisfaction Services

Compensate clients when misrepresentation of financial investment products has been confirmed

Return sales commissions if purchases of products are cancelled within five business days

Change PBs if a client is unhappy with his or her current one

Offer regular post-management services such as performance analyses and risk management activities

Compensation for mis-selling

Withdrawals of purchase

myManager

TrueCare

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Ethical M

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For the Em

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For the Com

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Ethical Management

Samsung Securities remains as a trusted partner to clients and market with its commitment to ethical management and employees' dedication as a member of society.

1. I have sufficiently read and understood the “Samsung Management

Principles”, “Employee Guidelines for a Clean Organizational Culture”

and “Code of Conduct for Compliance Management” and promise to

adhere to the principles.

2. I understand and will adhere to domestic and overseas laws,

regulations and company policies related to business operations and

will not act, cause to act, approve, abet or acquiesce to such an act

that is in violation of laws, regulations or company policies.

3. I will strictly draw the line between public and private matters with

honesty and integrity, and spearhead the effort to create a clean

organizational culture by fulfilling higher levels of moral obligations

and social responsibilities.

4. I will practice compliance management and ethical management and

promise to take full accountability for any breach of this Pledge and

follow disciplinary measures taken by the company without dissent.

Employee Pledge to Practice Ethical Management

1. We understand and practice Samsung’s management ideology, core

values, and management principles performing our duties transparently

and fairly with a law-abiding spirit.

2. When performing our duties, we comply with domestic and overseas

laws as well as the company's regulations.

First, we comply with fair trade regulations and shall not commit

any act such as collusion that would harm free competition.

Second, we comply with regulations and standards related with

corporate disclosures to prevent omission of corporate disclosures.

Third, we comply with laws and the company regulations related to

protection of investors and strive to safeguard the assets of

investors (clients).

Fourth, we comply with the laws and company regulations related to

privacy protection, lawfully manage personal information,

and prevent leakage of private information.

3. In order to minimize risk from violating regulations while working,

we must discuss with related departments including the Compliance

Team or Legal Affair Team prior to conducting duties.

4. In the case of violating domestic or overseas laws or company

regulations, or if there is any concern of violating them, we shall

notify the company immediately.

5. We actively participate in company activities such as employee

education, monitoring, on-site inspections, and after-sales management

to practice compliance management.

As the executives of Samsung Securities, we pledge to comply with

the code of conduct for compliance management and fulfill discussed

resolutions when performing our duties.

Executives’ Pledge to Practice Code of Conduct for Compliance Management

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Samsung Securities Report 2013 Corporate Responsibility 30.31

Protecting client informationThere has been an increasing call from both ordinary people and governmental agencies for enhanced levels of protection of people’s personal information. These demands increased in South Korea when data leakages were found to have occurred at three different credit issuers.

Samsung Securities’ client information protection system is led by the company’s Information Security Team. It is tasked with protect-ing client information and keeping our clients’ financial transactions safe and secure. The Team also establishes our security policies, provides employee training, and operates our security systems.

We were the first financial industry player in the country to include nine types of data in our personal identification databank. We also protect client information through mock training exercises involv-ing hacking and malicious codes, and by ensuring that our front-line channels carry out all our personal information requirements.

The depth of our commitment to the protection and management of our clients’ personal information is reflected in the fact that we have not experienced a single incident of personal information leakage or computer hacking.

Responsibilities of Information Security TeamEstablish policies regarding the protection of personal information Oversee departments involved in information protection activities Manage information protection policies Operate the company’s Information Protection Committee Conduct employee training in the area of information security

Goals of Security Checks Prevent information leakage by means of constant monitoring Check information protection status of frontline offices and make improvements as needed

Inspect security management status of IT operations Inspect security status of Samsung Futures Provide inspections at and training for affiliated and outsourced companies

Results of our customer satisfaction management programs and processesSamsung Securities is South Korea’s leading securities industry player in terms of customer satisfaction. We have ranked first in such well-known customer satisfaction surveys such as the National Cus-tomer Satisfaction Index, the Korean Standard Service Quality Index, and the Korean Customer Satisfaction Index for a number of years.

Results of CS Surveys Regarding Samsung Securities’ Services Ranked first in securities industry in NCSI from 2006 to 2013 Ranked first in securities industry in KCSI from 2006 to 2013 Ranked first in securities industry in KS-SQI from 2008 to 2013

* The 2013 NCSI survey was based on financial product sales and brokerage. We ranked first in both categories.

Samsung Securities uses the services of an outside research insti-tute to conduct its annual in-house customer satisfaction surveys. We enjoyed relatively high satisfaction levels at all our customer contact points in 2013.

Fair and open recruitment practicesSamsung Securities hires graduates from all universities as part of its fair and open recruitment policies. As a result, new hires from universities outside of Seoul now constitute 34% of the total. In addition, our tellers no longer need to provide us with a high school principal’s recommendation. We have switched to a group-wide, open recruitment process for high school graduates instead.

Our policy regarding job promotions is based on a candidate’s merit rather than his or her gender or educational background. We have several division heads who are women, and a number of our best financial advisors only have high school diplomas. We also hire new female employees whose careers have been interrupted for such reasons as marriage, pregnancy, or the need to look after their children.

Our employees are evaluated on the basis of both their competency and their job performance. They also have the right to contest the results of their job evaluations. Their rate of compensation includes their annual salary, performance-related bonuses, and a profit-sharing system. This means that talented employees are provided with fair and equitable opportunities to demonstrate their abilities to the fullest without regard to their educational or other history.

Training programs for developing our human resources We foster the development of human resources who can work comfortably outside of South Korea through the SS Academy, an in-house educational institution that focuses on strengthening our employees’ job skills. We conduct an annual assessment of their work-related competencies and weaknesses, and develop indi-vidualized training regimens to meet each employee’s needs.

Our employees are offered free, individualized instruction in six different job categories. This helps them to strengthen their quali-fications so that they can increase their level of professionalism and make our clients feel more confident about their abilities. They can also take advantage of both in-house and camp-based train-ing programs, and gain additional points at the time of their an-nual job evaluations by doing so. Some of the programs that our employees can enlist in include Chartered Financial Analyst and Certificated Financial Planner courses.

Ratio of Women’s Wages to Men’s Wages

Manager

97%

Assistant Manager

94%

Deputy General

Manager

100%

Senior Manager

102%

Senior Associate

99%

* Comparison of women’s pay to men’s when the wages of male employees in the same position are counted as 100 (as of 2013, including bonuses)

Female Employment

20132011

43.3%

20.3%

2012

42.4%

22.7%

42.3%

22.5%

Ratio of women in workforce

Ratio of women in middle management

For the Employees

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Ethical M

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er Satisfaction

For the Em

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For the Com

munity

Internal Control System

Encryption Automatic Shut-offs Monitoring

Encode nine items, including addresses, phone

numbers, email addresses, and ID information

Use digital rights management solution to encrypt

documents

Block leakages of information through prior

approvals regarding outgoing documents

Block non-business sites using whitelists

Block file uploads from external sites

Block the use of external storage media

Block the use of other media than designated

business emails and messengers

Log all messages sent through emails and

messengers

Block malicious codes to prevent infections

Operate 24-hour security officer system

Employees’ Advanced Certifications

340

40

38

152

389

42

47

146

351

34

38

133

CFP

* The number of certificate holders fell in 2013 due to corporate downsizing.

CFA Level Ⅲ

Level Ⅱ

Level Ⅰ

2011 2012 2013

Employee Education

189

40

143

1,640,000

154

39

342

1,250,000

111

177

792

1,175,500

2011 2012 2013

Average number of

classroom hours per year

Number of

Courses

Average training cost

per employee(KRW)

In-house

External

Samsung Securities’ organizational culture begins with fair and open recruitment practices, and also takes a prudent and constructive approach to training and compensation designed to maximize individual’s capability.

Customer Satisfaction Scores (In points)

20132011

73

70.8

73.7

2012

72

70.7

78.1

73 / 73

71.8 / 72.0

76.3

NCSI

CSI Samsung Securities

Samsung Securities

Industry Average

* The 2013 NCSI survey was based on financial product sales and brokerage

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Samsung Securities Report 2013 Corporate Responsibility 32.33

The Six Components of the SS Academy

Emphasizes proper decorum and behavior and inculcates

a feeling of loyalty among Samsung Securities employees

Trains financial advisors who will lead the financial market

by strengthening their wealth management skills

Develops the skills of financial professionals working in

our Wholesale, IB, and Product Marketing sections

Develops leaders who will bring the company's corporate

vision to fruition through the establishment of a warm and

welcoming organizational culture

Develops human resources who can work comfortably on

the global stage through language programs and global

expert courses. Includes the Samsung MBA program

Offers custom-tailored training opportunities to employees

wishing to upgrade their qualifications

Initiation

School

PB School

HQ Sales

School

Leadership

School

Global

School

General

School

(Number of persons)

Employee benefitsOur comprehensive employee benefits package includes assis-tance in such areas as education, health, cultural activities, and clubs. We also offer a wide range of extended benefits, such as maternity leaves and initiatives to encourage a healthy work-life balance. Our Healing Maru program, which is available to every employee, offers a wide range of stress management programs to make our workplace warmer and more welcoming. This results in a workforce that is happier and more motivated.

Statutory benefits: Occupational health and safety insurance, health insurance, employment insurance, national pension benefits Employee assistance benefits: Assistance with children’s schooling, retirement, housing, medical benefits Leisure-time benefits: Support for cultural and club activities, subsidized stays at vacation resorts Other: Support for family events and vehicles used for commuting to and from work

Retirement assistanceWe began offering an employee retirement pension plan in 2006. As of the end of December 2013, our pension fund was worth KRW 87.2 billion. KRW 58.8 billion of this was for a defined benefit plan, and KRW 28.4 billion was for a defined contribution plan. In addition, we established a Retirement Pension Operations Committee in De-cember 2010. Our goal in doing this was to meet the differing needs of our employees and ensure an efficient decision-making system.

Our Career Development Center helps our employees access a wide range of programs, such as a real estate asset manager’s course, a Korean food chef’s course, and a Seniors Start-up edu-cation course. All of them are designed to help our older workers prepare for a happy and healthy life when they retire.

Reporting workplace grievancesWe operate an online communications channel called “What Shall I Do?” to enable our employees in addressing issues including discrimination, sexual harassment, and unfair working conditions on an anonymous basis. The reports are treated confidentially, and the person making the report can expect a response within 48 hours. We have also hired a sexual harassment counselor, and offer all our employees an annual training program dealing with sexual harassment.

Our employee can also inform us about problems with their work conditions through a Voice of Employee system. One major ben-efit of this program is that it helps to improve the level of commu-nications between labor and management.

Labor-management relationshipsWe respect the right of our two labor unions to bargain collective-ly, and take immediate steps to work with them when they signal

their wish to begin contract negotiations. 388 of our employees were union members as of the end of 2013.

We also respect the autonomy of our unions, and have guaran-teed them three major labor rights in the collective agreement. In addition, we participate in a labor-management council held every quarter to discuss major labor-management issues, such as working conditions, training and education, wages and salaries, maternity leaves, employee benefits, and health and safety. In the event that there are any significant changes in our operations (including restructurings, closures, corporate splits, or business transfer, mergers, or acquisitions), we give the unions fifty days notice of them in advance to negotiate such matters.

We have signed an official workplace health and safety agreement with our two labor unions, and comply with all the rules and regu-lations contained in the Labor Standards Act and the Occupa-tional Safety and Health Act. In addition, we oppose unfair labor practices in accordance with the UN Global Compact and the ILO Conventions and Recommendations on Child Labour.

Issues Covered by the Health and Safety AgreementWorkers’ representatives participate in health and safety inspections, auditing, and accident investigations. If there is a system for handling complaints Right to refuse unsafe work Compliance with ILO Conventions Independent validation program regarding safe worksites

* S1, one of South Korea’s leading security companies, is in exclusive charge of security at Samsung Securities. All employees of S1 have undergone training courses in workplace safety and human rights.

Composition of Employees

20132011 2012

Number of Employees (Domestic)

By Gender

By Position

By Employment

Status

Marginalized People (The Disabled)

3,113

1,765

1,348

36

1,311

1,766

2,660

453

79

3,067

1,766

1,301

38

1,314

1,715

2,740

327

74

2,745

1,585

1,160

32

1,240

1,473

2,563

182

70

Male

Female

Executives

Middle Managers

Junior Staff

Regular

Temporary

Evaluation and Compensation System

Performance Evaluations

Competency Evaluations

Multidimensional Evaluations

Bi-annually

All employees

Management by

objectives evaluations

Annually

All employees

Evaluations

categorized by skills

Annually

Middle managers

or higher

Peer reviews

Frequency

Evaluation

Object

Method

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For the Com

munity

Percentage of Returns after Childcare Leaves

2011 2012 2013

1

68

52

(80.0%)

19

(95.0%)

1

74

55

(93.2%)

44

(84.6%)

2

102

86

(91.5%)

52

(94.5%)

Number of employees

on childcare leave

Number of employees

returned from leaves

(return rate)

Number of employees

retained after leaves

(retention rate)

Female

Male

* The return rate refers to the percentage of returned employees out of all those scheduled to return in any year.* The retention rate refers to the percentage of employees with one or more years of service out of all returned employees in the preceding year. * The above rates in relation to returns and employment for the past three years were recalculated based on the same standard.

Recruitment and Turnovers

20132011

464

257

207

(44.6%)

67

(2.3%)

2012

187

124

63

(33.7%)

102

(3.3%)

141

88

53

(37.6%)

71

(2.3%)

Number of Employees Recruited

Men

Women

(% of women)

Number of Employees Departing

(turnover rate)

* Turnover rate: Number of employees that changed their jobs this year divided by total employees of last year

Key Educational Programs

Name Target Content

Dual Care System

Training of Financial Advisors

Healing Camp

Special Lectures by Leading WorkersProfessional Certifications

Advanced Employment

New Employees

Employees who want to become financial advisors

PB team leaders

Employees at the Wholesale Division and Research CenterAll employees

All employees

New employees work with a senior employee and the head of his or her department to help them adjust to their duties and become familiar with them.Practical knowledge and skills training to help them adapt to their duties and develop the skills needed in their capacity as PBs.Promotion of rest and relaxation, stress management, and teamwork through Healience Village programs.Leading workers in the industry share their knowledge with other employees on a quarterly basis.

This program offers employees specialized training and HR support to help acquire professional financial certificates, including the CFP and CFA. Employees can also enroll in a wide range of other certification programs, such as certified labor consultants and tax accountants. This program is designed to enhance our employees’ skills in such operations as presentations and the preparation of the minutes of meetings.

HR Development Structure

Executive

Senior Managers

General Deputy Managers

Managers

Assistant Managers and (Senior) Associates

SVP SLP SGP

Executive seminars

Newly-appointed or hired executives

Newly-appointed Senior Managers

Newly-appointed General Deputy ManagersNewly-appointed managersSummer training sessionsNew employee initiationGlobal employee initiation

Newly-appointed presidents of overseas operationsGlobal Executives CourseOverseas employee leadershipGlobal Leaders Course Newly-appointed overseas employees

Regional experts

Co

rpo

rate Resp

onsib

ilityFinancial P

erform

ance

Samsung Securities Report 2013 Corporate Responsibility 34.35

Industrial Accidents and Sick Leaves

2011

1

0.31%

2012

None

0.46%

2013

None

0.39%

Number of Industrial Accidents

Ratio of Lost Time Due to Absences

* Ratio of lost work hours due to absences: Total hours of absence due to sick leaves divided by total work hours

Labor-management Consulting Bodies

Frequency

Quarterly

(4 times a year)

Monthly or as

needed(at least

twelve times a year)

Every two years

Annual

Key Issues

Wages, working

conditions,

Various issues,

including HR

policies

Wage conditions

Attendees

CEO,

executives,

Heads of labor

unions, etc.

Labor-Manage-

ment Council

Labor-Manage-

ment Meeting

Collective

Bargaining

Wage Negotiations

Foreign language courses / Advanced-level studies

Experienced initiation

Developing chief executives Developing upper level managersDeveloping executives

Special-ization in leadership

EMBA

Samsung MBA

Social contribution activities tailored to the needs of each communityThe Samsung Securities Volunteer Group was founded in 1995. As of 2013, there were 123 volunteer teams spread across the country participating in volunteer work on at least a monthly basis. We allow our employees to take part in these services during their working hours as a means of encouraging them to help the less fortunate. In the case of a natural disaster, paid leave is granted if our employees wish to help the victims of the catastrophe.

Each volunteer team has a leader, and its members work together to decide on the type of activities that best meet the needs of the region in which they are working. They also consult with relevant govern-ment agencies and NGOs to facilitate their decision-making. Our employees participate in these activities at least twice a year.

FundraisingThe Nanumi Fund is our main source of financing for our social con-tribution activities. It is funded through voluntary donations by our employees. They donate money to the fund every month, and we are very pleased to see that both the amount of their donations and their participation rate are increasing every year.

Wealth healing service for employees of SMEsIn April 2013, we launched a comprehensive Wealth Healing service to provide no-cost retirement planning services to the employees of small and medium-sized enterprises that do not possess either the experience or the expertise needed to operate their own programs in this very important area. It is operated in collaboration with the Korea Chamber of Commerce & Industry. The program is especially de-signed to offer wealth management solutions to members of the “baby boom” generation who have retired or are about to do so.

Our financial experts offer the executives and employees of SMEs a host of on-site information on wealth management. They also give free, one-on-one advice regarding our lifetime wealth diagno-sis services. This includes comprehensive wealth diagnoses and information on retirements, succession plans, taxation issues, and real estate management. If an SME is having difficulty in terms of its management or raising funds, our experts offer them a wide range of solutions in such areas as IPOs, investment banking, M&As, and real-estate investments.

Donations for Social Contribution Activities

2011 2012 2013

5,688

178

68%

359

291

2,411

189

71%

550

263

1,208

326

92%

216

134

Aggregate donations for social

contribution activities

Nanumi

Fund

Direct donations

to social contri-

bution programs

Amount raised

Employee

participation rate

Education

Social

Assistance

(In millions of KRW)

* The amount of aggregate donations for our social contribution activities includes those that have been earmarked for charity organizations, NGOs, research institutes, and educational institutions, as well as direct investments in social contribution projects

Employee Participation in Social Contribution Activities

2011 2012 2013

3,481

125

12,425

3,893

131

12,220

6,753

123

19,161

Number of participants

Number of volunteer teams

Total volunteer hours

* The number of participants includes people who have participated more than once.

Wealth Healing Service Highlights

Major Services Details

On-site services

Information offered

to members of

the SME Advisory

Group

KCCI Members’

Event

CEO Wealth

Healing Camp

Information about retirement planning and life-long

wealth management advice for CEOs and

employees of SMEs.

Information regarding all aspects of wealth

management, including family business successions,

real-estate analyses, M&As, and IPOs

Retirement and wealth management consulting

during regular KCCI event

Special lectures and workshops for CEOs of

SMEs regarding financing, taxation, real estate, life

insurance, and healthy lifestyles

For the Community

Corp

orate Governance

Risk M

anagement

Ethical M

anagement

Custom

er Satisfaction

For the Em

ployees

For the Com

munity

Youth economy & securities academyThe Youth Economy & Securities Academy is our primary social con-tributions initiative. It was launched in 2005. Its goal is teach young people about the role that Economics plays in the world through an adaptation of courses created by Biz World, an American educa-tional institution that focuses on training in Economics. Its three pro-grams, including Economics Playground, Economics Academy, and Youngconomics, help students learn through play and experience.

The Youth Economy & Securities Academy is operated by Samsung Securities, Kids & Future, a social assistance foundation, and a part-nership of five social assistance centers. It offers a customized cur-riculum for students ranging from fourth graders to middle and high school students. The Economics Playground program, which fea-tures lessons taught by Samsung Securities employees, is especially geared towards the children of low-income families.

College student volunteer groupWe also operate a nationwide network of courses in Economy and Securities training and education. It has been offered to young people through YAHO, our college volunteer group, since 2009. The 560 members of YASHO volunteer at five education centers at least twice a month. They also participate in a mentoring program with our employees.

Study centers for children of low-income familiesOur Dream Maru study centers were established in 2012. Focusing on the children of low-income families, these multi-use spaces as-sist the children with their studies, and offer them a variety of cultural activities as well. Samsung Securities employees act as mentors by joining in their activities. The students take courses in Economics and the Humanities, and go on field trips.

Donation consulting serviceOur donation consulting service provides information to clients with an interest in philanthropy and the socially responsible use of their inheritances in such areas as the establishment of public foundations and making donations to public organizations. It also provides us with a way in which we can use our experience and experience to assist in the spread of a culture of caring and sharing.

* Participating partners in the program are chosen from among social assistance organizations and facilities through an annual selection process. Twenty-five such organizations were selected in 2013.

Participation in Youth Economy & Securities Academy and YAHO

20132011

138,905

6,626

180

2012

151,961

6,743

180

158,716

6,867

100

Total number of participated students

Total number of participated classes

Number of college students participated

in YAHO

Donation Consulting Results

20132011

9

1

2012

8

3

11

3

Number of consultation cases

Number of donations and foundations

established

Samsung Securities’ social contribution and green management activities help fulfill the responsibilities as a caring and concerned corporate citizen

Co

rpo

rate Resp

onsib

ilityFinancial P

erform

ance

Samsung Securities Report 2013 Corporate Responsibility 36.37

Economics Playground Program Activities

Connection

with Samsung

Securities

Collaboration

between social

contribution

group and nearby

Samsung Securi-

ties branches

Involvement of

Samsung Securi-

ties executives

and employees

Events

Participation in

camps and other

events

Support for

projects on an

annual basis

Supporting

participating

organizations on

an annual basis

Utilizing Samsung

Securities’ YAHO

college student

volunteer group

Program

reviews

Identifying positive

changes in par-

ticipating children

Conducting

research into the

effect of training

in economics

education, and

analyzing exem-

plary cases

Curriculum of Youth Economy & Securities Academy

Economics

Playground

Economy

Academy

“Youngco-

nomics”

Targets: Elementary students in grades 4 to 6 from local

children’s centers

Participation: Participants are selected from social assistance

centers and facilities each year

Contents: Play- and experience-based themes relating to

Economics and the economy

Targets: Children of clients or living in institutions where the

service is being offered in grades 4 to 6

Participation: Contact the nearest Samsung Securities branch

Contents: Programs help children to learn about such matters

as securities firms, currencies, managing their

allowances, and prices

Targets: Middle and high school students aged 14 to19

Participation: Contact the nearest branch of Samsung Securities

Contents: Training in aspects of Economics that are important

in our daily lives, such as life-time planning,

savings and investments, risk management, credit

management, and career searches

32.33

Saving energy and other resources Samsung Securities’ green management initiatives are part of our many efforts to be a caring and concerned corporate citizen. We started the first of these programs in 2010. They include monitoring environmental data and seeking ways to reduce unnecessary energy use.

We operate a “Work Diet” campaign to reduce unnecessary waste in our business practices and encourage our employees to conserve energy. Some of the measures that we have adopted include printing on both sides of a page and discouraging the use of color printing. This has allowed us to reduce the amount of photocopy paper we use significantly. In 2013, for example, the reduction in use of A4-size photocopy paper helped to save the lives of an estimated 990 thirty-year-old trees.

Socially responsible investingOur socially responsible investing activities include offering “green” investment products, ranging from SRI funds to carbon credit funds. The Allianz Value Creation Fund, which we have been selling since 2007, is a prime example of an SRI fund. It only invests in enterprises that have demonstrated excellent corporate governance practices and fulfill all their environment and social responsibilities.

Major Sustainable Management Financial Products

Fund Name Sales Balance

Allianz Value Creating

Long-Term Equity Fund

Samsung Global Water Fund [1]

Korea Private Placement

Carbon Special Assets Fund [1]

Samsung Global Alternative

Energy Fund [1]

37.4

17.9

11.0

5.2

SRI

Water

Carbon

Alternative Energy

(In billions of KRW)

Environmental Indicators

2011Unit 2012Classification 2013

111,510

263,172

13,586

1,968

6,684

252

624

923

3,135

1,131

424

2,823

4,378

23,183

107

9,916,733

㎥

ℓ

ℓ

MWh

MWh

tCO2e

tCO2e

tCO2e

tCO2e

10,000 sheets

10,000 sheets

10,000 sheets

10,000 sheets㎥

tonne

km

103,843

220,635

12,715

1,955

7,043

235

527

917

3,303

1,759

535

2,705

4,999

24,015

237

7,037,541

Head office

Company-wide Vehicles

Company-wide Vehicles

Head office

IT Center

Head office

Company-wide Vehicles

Head office

IT Center

Company-wide

Company-wide

Company-wide

Company-wide

Head office

Head office

Company-wide

86,312

235,076

14,957

1,827

7,586

195

565

857

3,558

707

588

1,715

3,010

22,758

280

7,408,068

Energy

Consumption

Greenhouse Gas

Emissions

Papers

Water

Waste

Business Travel

City Gas

Gasoline

Diesel

Electricity

Scope1

Scope2

Reports

Documents

Photocopy Paper

Sub-total

Water Supply

Relative Indicators (Consumption per Person)

2011Unit 2012Classification 2013

98

1.74

0.22

0.81

㎥

MWh

tCO2e

tCO2e

100

1.88

0.23

0.88

Head Office

Head Office

Head Office

Head Office

100

2.12

0.23

1.00

Energy

Consumption

Greenhouse

Gas Emissions

City gas

Electricity

Scope1

Scope2

* Scope 1 means direct GHG emissions caused by the use of fossil fuels such as heating oil. Scope 2 means indirect GHG emissions caused by the use of electricity.* IPCC, Energy Management Corporation, and WBCSD/WRI data were used to calculate carbon emissions and unit conversions. We applied an electricity emissions factor of 0.469t CO2/MWh.* GHG emissions per capita have been calculated by dividing gas emissions derived from electricity and city gas consumption at our HQ by the number of employees at our HQ.

FINANCIAL PERFORMANCE

2.

Samsung Securities is confident that our strong

capabilities and comprehensive business

infrastructure create competitive advantage

that has proven resilient in the stagnant market

environment in 2013.

Building on the largest client base we

have accomplished collaboration across

our divisions, including brokerage, wealth

management, investment banking, and sales &

trading, facilitates balanced portfolio of solid

income streams.

Samsung Securities Report 2013 Financial Performance 38.39

With our competitive advantage in strong capital position and top human resources, we will continue to serve clients with solutions tailored to their needs. Samsung Securities will further strive to thrive as the best financial institution with our dominance in retail wealth management division.

In FY 2013, our consolidated total assets and liabilities recorded KRW 20.5 trillion and KRW 17.1 trillion, respectively, up 5.4% and 6.9% over the year. The increase in both assets and liabilities was a result of growth in borrowings and financial assets at fair value through profit or loss, reflecting rise in securities sold under repur-chase agreements. Total equity remained relatively stable at KRW 3.4 trillion, including common stock capital of KRW 394.2 billion. As of December 2013, Samsung Securities owns 2,023,178 shares a treasury stocks, 2.6% of 76,435,165 shares issued.

Consolidated net revenue in FY 2013 recorded KRW 557.9 billion, down 42.2% compared to FY 2012, primarily reflecting changes in fiscal year and stagnant equity market Operating expenses (includ-ing personnel expenses, depreciation and amortization, and G&A expenses) was KRW 519.2 billion, down 28.7% with continuous ef-fort for cost reduction. Our net revenue-to-expenses ratio dropped to 107.5%from 132.6% in FY 2012.

As a result, our consolidated pretax income fell by 84.7% to KRW 35.7 billion. Net profit and net profit attributable to shareholders shrank by 86.7% and 93.3%, respectively, to KRW 24.0 billion and KRW 11.0 billion. Return on equity attributable to shareholders de-clined from 5.0% in FY 2012 to 0.4%.

FY 2012

780.1

601.4

-9.0

169.6

39.1

130.6

-

FY 2011

977.5

688.8

-81.2

207.5

72.8

134.7

-

FY 2013

430.9

423.7

1.6

8.8

0.4

8.4

-

(Y-Y)

-45%

-30%

-

-95%

-99%

-94%

-

Net Revenue

Operating Expenses

Non-operating Income

Pretax Income

Income Tax Expenses

Net Profit

(Controlling Interest)

FY 2012

965.6

728.0

-4.7

232.8

52.1

180.7

163.7

FY 2011

1,177.1

890.4

-0.7

286.0

93.5

192.5

171.5

FY 2013

557.9

519.2

-3.0

35.7

11.6

24.0

11.0

(Y-Y)

-42%

-29%

-

-85%

-78%

-87%

-93%

Consolidated Basis Separate Basis

Earnings Summary (In billions of KRW)

Overview

Business P

erformance

Risk and

Cap

ital Ad

equacy

Financial Information

Financial Perfo

rmance

Co

rpo

rate Resp

onsib

ility

Overview We are well positioned to achieve sustainable growth by generating solid earnings across business and deliver value to all our clients.

Operating environment The global economy continued its gradual recovery in FY 2013, though at a moderate pace, driven by improvement in economic activity of developed countries. US economy recovered with increase in consumer spending and housing investments. With growing expectations over “Abenomics”, Japan recorded solid growth. The improvement in economic activity varied among Eu-ropean countries. Several EU countries, notably Germany, France, and England, reported to have entered growth phase, while Italy and Spain were still under macro uncertainties. Chinese soft-landing scheme and subdued export by emerging markets under-performed market expectations.

Market conditions deteriorated to overshadow optimistic domestic economy that appeared to be recovering faster than anticipated in the first half of 2013. Towards the end the year, consumer spend-ing contracted with obscure global environment difficult to predict.

Market environment Equity market KOSPI index in 2013 showed a moderate recovery, increasing from 1,997 point to 2,011 point.

Rise in outflow of foreign capital and the possibility of QE tapering triggered drop in KOSPI index to 1,781 in the first half of 2013. However, with gradual recovery of global economy and growth in preference for undervalued equities, the index rose to 2,060 point, recording a record-high market capitalization of KRW 1,211 trillion. By the end of the year, KOSPI index dropped to previous year’s level with weakening of Japanese Yen and decelerated Chi-nese market growth.

Total equity market turnover in 2013 decreased for two-consec-utive years from KRW 4,763 trillion in 2011 to KRW 3,265 trillion, falling by 12% compared with 2012. Individual investors showed net sale of KRW 5.65 trillion, while domestic institution and foreign investors net purchased KRW 2.4 trillion and KRW 3.2 trillion, re-spectively.

Bond market Despite economic stimulus policies announced by the new gov-ernment at the beginning of the year, 3Y government bond inter-est rate tumbled to historical low 2.44% as investor preference for low risk assets increased considering global macro uncertainties.

Although delay in QE tapering and closure of federal government limited the rise of bond yield, proliferation of optimistic views on economic boom pushed the yield higher.

Total domestic bond market turnover increased slightly by +2.6%, recording KRW 7,360 trillion. Government bond, financial bond, and asset-backed securities turnover all rose by 6.5%, 4.6%, and

14.3%, respectively, to KRW 4,858 trillion, KRW 536 trillion, and KRW 37 trillion. However, corporate bond, special bond, mone-tary stabilization bond, and municipal bond turnover decreased to KRW 176 trillion, KRW 335 trillion, and KRW 20 trillion. Turnover ratio decreased by 31.6% points, recording 514.4%.

Fund market Domestic mutual fund market totaled KRW 184 trillion by the end of 2013, down 1.0% from the previous year. Equity and fixed income fund AUM fell by KRW 7.5 trillion and KRW 0.5 trillion, respectively, to KRW 72 trillion and KRW 12 trillion. Both hybrid and money market fund AUM increased by KRW 2 trillion, record-ing KRW 14 trillion and KRW 64 trillion each. Installment type fund dropped from KRW 54 trillion to KRW 48 trillion.

The exchange-traded fund (ETF) market expanded by 32% to KRW 19 trillion. The total number of ETFs listed at the end of 2013 was 146, including 16 newly listed ETFs. There are total of 16 asset manager participating in the ETF market which accounts for 1.6% of KOSPI market capitalization, and 12% of total equity market turnover.

OTC derivatives market With growing global economic uncertainties and continuing low interest rate environment trends, the demand for principal guaran-teed equity and derivative-linked securities surged, recording total issuance of KRW 63.0 trillion in the market.

Equity-linked securities (ELS) issuance totaled KRW 42.5 trillion, with sales of overseas equity, overseas index, and hybrid type all rising by 123%, 19%, and 8%, respectively, to KRW 0.3 trillion, KRW 22.2 trillion, and KRW 1.3 trillion. Domestic equity and index type ELS sales decreased by 35% and 26%, respectively, to KRW 3.9 trillion and KRW 14.8 trillion. Both principal-guaranteed and unguaranteed ELS products were issued fewer by 2% and 10%, recording KRW 13.9 trillion and KRW 28.6 trillion.

Derivative-linked securities (DLS) market contracted by 14% over the year to KRW 20.4 trillion as demand diminished. Issuance of interest rate and credit-linked securities fell by 37% and 38%, respectively, to KRW 7.9 trillion and KRW 4.3 trillion. Commodity-linked products surged by 65% to KRW 3.5 trillion. Both principal -guaranteed and unguaranteed DLS declined by 22% and 3%, respectively, to KRW 10.9 trillion and KRW 0.9 trillion.

BusinessPerformance

Balance Sheet Summary (In billions of KRW)

FY 2012

18,382

15,066

3,317

18,382

FY 2011

15,870

12,628

3,242

15,870

FY 2013

19,505

16,232

3,273

19,505

(Y-Y)

+6%

+8%

-1%

+6%

Total Assets

Total Liabilities

Total Equity

Total Liabilities and Equity

FY 2012

19,481

15,998

3,482

19,481

FY 2011

16,771

13,390

3,380

16,771

FY 2013

20,536

17,098

3,437

20,536

(Y-Y)

+5%

+7%

-1%

+5%

Consolidated Basis Separate Basis

Samsung Securities Report 2013 Financial Performance 40.41

We aspire to become a leading player with dominant market share by focusing on core businesses and offering differentiated financial products and services.

Client assets The value of our client assets in FY 2013 totaled KRW 184.6 tril-lion, up 0.6% from KRW 183.5 trillion the previous fiscal year. Client assets subject to wealth management increased from KRW 116.5 trillion to KRW 117.5 trillion, as a result of net inflow of KRW 6.1 trillion. Individual client assets increased from KRW 68.8 trillion to KRW 69.2 trillion.

The number of HNWI (clients with assets over KRW 100 million) recorded 80 thousand with KRW 59.4 trillion client assets, both the largest in the industry. The HNWI client assets account for 86% of total wealth management client assets.

Financial product assets among the wealth management client assets expanded by KRW 2.0 trillion to KRW 44.9 trillion with increase in fund and trust balance. Equity assets decreased by KRW 1.0 trillion to KRW 71.3 trillion

Revenue breakdownBrokerage commissionEquity market turnover in FY 2013 (including the KOSPI, KOS-DAQ, and ETFs) fell by 28.6% over the year from KRW 3,421 trillion to KRW 2,441 trillion. As a result, brokerage commission declined by 30.4%, recording KRW 188.8 billion.

Brokerage market share by turnover rose by 0.5% points to 6.2%. Market share in both retail and institutional markets remained rela-tively stable at 3.5% and 0.8%, respectively, while foreign investor market share increased by 0.2% points to 1.2%.

The average rate of equity brokerage commissions fell by 1.3 basis points over the year, mainly due to an increase in low-priced DMA transactions by overseas institutional investors.

Investment banking market Debt capital market in 2013 fell from KRW 101.7 trillion in 2012 to KRW 89.2 trillion as the rise of credit risk of some major com-panies despite the low interest rate environment. Especially, total corporate bond issuance dropped to KRW 40.5 trillion, record-ing the lowest after 2009. The IPO market continued its sluggish trends, although the market size increased to KRW 1.3 trillion from KRW 1.0 trillion in the previous year. Excluding the largest IPO deal (Hyundai-Rotem IPO worth KRW 622.3 billion) leaves the total 2013 IPO market volume 68% of the size in 2012. Right of-fering in 2013 increased by 19% to KRW 20.4 trillion as construc-tion and shipping companies preferred funding through equity is-suance for financial stability. M&A market size decreased by KRW 4.5 trillion, recording KRW 31.5 trillion. While financial investors exhibited bullish investing appetite, strategic investors also en-tered the market for M&A. M&A financing market was worth KRW 5.2 trillion, including KRW 3.4 trillion related to new M&A deals.

Earnings summarySamsung Securities’ consolidated net revenue in FY 2013 was KRW 557.9 billion, down 42.2% from FY 2012. This sharp re-duction is due to the change of fiscal year, drop in the sales of retail bonds, deterioration in fixed income sales & trading, and fall in brokerage income. Our consolidated operating expenses recorded KRW 519.2 billion, down 28.7% over the year. This was primarily attributable to efforts to improve cost efficiency and re-duce personnel costs. In a nutshell, consolidated net profit fell by 93.3% over the year to KRW 11.0 billion. Earnings per share and return on equity dropped to KRW 148 and 0.4% from KRW 2,200 and 5.0% the previous year.

Earnings Summary (In billions of KRW)

FY 2012

965.6

302.8

333.5

29.6

297.8

21.1

-19.3

728.0

382.3

48.6

297.1

-4.7

232.8

52.1

180.7

163.7

FY 2012

780.1

271.4

206.8

29.5

264.5

37.5

-29.7

601.4

313.5

43.2

244.7

-9.0

169.6

39.1

130.6

-

FY 2011

1,177.1

466.9

358.2

42.4

315.8

9.3

-15.5

890.4

501.9

48.5

340.0

-0.7

286.0

93.5

192.5

171.5

FY 2011

977.5

418.0

238.4

39.7

290.8

23.9

-33.3

688.8

373.2

43.3

272.3

-81.2

207.5

72.8

134.7

-

FY 2013

557.9

211.0

279.8

24.0

37.9

18.5

-13.4

519.2

268.3

37.2

213.6

-3.0

35.7

11.6

24.0

11.0

FY 2013

430.9

188.8

179.7

24.0

25.6

33.9

-21.1

423.7

215.0

33.4

175.3

1.6

8.8

0.4

8.4

-

(Y-Y)

-42%

-30%

-16%

-19%

-87%

-12%

-31%

-29%

-30%

-23%

-28%

-

-85%

-78%

-87%

-93%

(Y-Y)

-45%

-30%

-13%

-19%

-90%

-10%

-29%

-30%

-31%

-23%

-28%

-

-95%

-99%

-94%

-

Net Revenue

Brokerage Commissions

Sales Commissions on Financial Products

Underwriting and Advisory Commission

Trading and Interest Income

Other Income

Commission Expenses

Operating Expenses

Personnel Expenses

Amortization and Depreciation Expenses

SG&A Expenses

Non-operating Income

Pretax Income

Income Tax Expenses

Net Profit

(Controlling Interest)

Consolidated Basis Separate Basis

Overview

Business P

erformance

Risk and

Cap

ital Ad

equacy

Financial Information

FY 2012

116.5

59.2

9.6

47.7

79,906

FY 2011

108.6

58.2

10.0

40.4

78,803

FY 2013

117.5

59.4

9.8

48.3

79,641

(Y-Y)

+0.9%

+0.3%

+2.1%

+1.3%

+0.03%

Wealth management

client assets

HNWI clients

Mass individual clients

Corporate clients

Number of HNW clients

Breakdown of Client Assets (In trillions of KRW)

* HNW clients refer to those with KRW 100 million or more client assets deposited in Samsung Securities

FY 2012

116.5

72.3

42.9

13.7

10.8

4.2

8.7

2.1

1.3

2.2

1.3

FY 2011

108.6

72.9

35.6

12.1

9.3

5.5

4.2

1.6

0.9

0.6

1.4

FY 2013

117.5

71.3

44.9

15.5

10.0

5.2

9.6

2.1

1.4

1.1

1.3

(Y-Y)

+0.9%

-1.4%

+4.7%

+13.6%

-8.1%

+24.0%

+10.7%

+1.8%

+9.7%

-47.9%

-0.6%

Wealth management

client assets

Equity assets

Financial product assets

Funds

Bonds

Repo

Trusts

OTC derivatives

Retirement pensions

Other

Cash deposits

Client Asset Breakdown (In trillions of KRW)

FY 2012

302.8

271.4

265.3

213.4

27.6

24.3

FY 2011

466.9

418.0

404.2

335.8

34.0

34.4

FY 2013

211.0

188.8

178.5

148.1

18.5

11.8

(Y-Y)

-30%

-30%

-33%

-31%

-33%

-51%

Brokerage commissions

(Consolidated)

Brokerage commissions

(Separate)

Equity brokerage commissions

Retail clients

Domestic institutional clients

Overseas institutional clients

Brokerage Revenues (In billions of KRW)

* Source : Financial Supervisory Service.

FY 2012

8.0%

5.7%

3.5%

0.8%

1.0%

0.4%

FY 2011

8.8%

5.9%

4.2%

0.9%

0.5%

0.1%

FY 2013

7.5%

6.2%

3.5%

0.8%

1.2%

0.7%

(Y-Y)

-0.6%p

+0.5%p

-

-

+0.2%p

+0.3%p

By Commission

By Turnover

Retail clients

Domestic institutional clients

Overseas institutional clients

Other

Market Share of Equity Brokerage Financial Perfo

rmance

Co

rpo

rate Resp

onsib

ility

Samsung Securities Report 2013 Financial Performance 42.43

Fund sales revenue totaled KRW 39.9 billion in FY 2013. Fund sales net asset value totaled KRW 15.9 trillion, up 14.0% for the year, as a result of increased sales in hybrid and bond-type funds. Sales of equity-type funds fell by 7.1% to KRW 3.0 trillion.

Wrap account revenue recorded KRW 15.8 billion in FY 2013. Despite total asset under management increased slightly over the year to KRW 4.9 trillion, equity-type balance fell by 27.3% to KRW 1.1 trillion as redemption of externally advised wrap account con-tinued.

OTC derivatives related revenue recorded KRW 105.9 billion, due to increase in DLS sales and the early redemption of ELS. ELS sales fell by KRW 0.3 trillion to KRW 2.1 trillion, while DLS sales rose by KRW 0.2 trillion to KRW 3.6 trillion.

Investment bankingUnderwriting and advisory commissions totaled KRW 24.0 billion, mainly due to increases in M&A and IPO volume. Volume in the domestic IPO market increased by KRW 0.2 trillion over the year to KRW 1.1 trillion, while bond issuance and M&A advisory market volume both reduced by respective 27.8% and 55.9% to KRW 68 trillion and KRW 12 trillion.

Trading and interest incomeTrading and interest income recorded KRW 25.6 billion in the midst of highly volatile interest rates and reduced sales of retail bonds. Retail bond sales decreased by 64.2% to KRW 2.2 trillion from KRW 6.0 trillion the previous year. Income from client cash deposits fell by 46% due to cut in benchmark rate by the Bank of Korea.

Operating expensesOperating expenses fell by 30% over the year to KRW 423.7 bil-lion, mainly backed by cost reduction program and decrease in compensation payment due to revenue fall. As the number of headcount dropped by 340 to 2,772 employees, personnel ex-penses decreased by 31% to KRW 215.0 billion. G&A expenses shrank by KRW 69.4 billion to KRW 175.3 billion, via further re-trenchment of costs such as advertising expenses.

(Y-Y)

-30%

-31%

-23%

-28%

-26%

-27%

-48%

-22%

-26%

+21%p

-3%p

-5%p

FY 2012

601.4

313.5

43.2

244.7

66.6

43.9

25.3

8.2

100.7

77%

52%

18%

FY 2011

688.8

373.2

43.3

272.3

61.3

41.6

44.1

9.2

116.1

70%

54%

26%

FY 2013

423.7

215.0

33.4

175.3

49.2

31.9

13.0

6.4

74.8

98%

51%

13%

Operating expenses

Personnel expenses

Depreciation expenses

G&A expenses

IT expenses

Rental expenses

Advertising

Sales promotions

Other

Operating expenses/

Net revenue

Personnel expenses/

Operating expenses

Compensation payments/

Personnel expenses

Operating Expenses (Separate) (In billions of KRW)

Overview

Business P

erformance

Risk and

Cap

ital Ad

equacy

Financial Information

FY 2012

333.5

206.8

45.2

26.5

89.4

45.6

FY 2011

358.2

238.4

59.8

60.6

93.2

24.7

FY 2013

279.8

179.7

39.9

15.8

105.9

18.2

(Y-Y)

-16%

-13%

-12%

-40%

+18%

-60%

Sales commissions on

financial products

(Consolidated)

Sales commissions on

financial instruments

(Separate)

Funds

Wrap accounts

Securitized derivatives

Other

Sales commissions on financial products (In billions of KRW)

Types of risk We seek to monitor and control our risks according to the risk type. For global-standard oversight of our risk management pro-cess, we established the Samsung Integrated Risk Intelligence System (SIRIS) in 2008. The first of its kind in the industry, the integrated system provides information on risks per type, such as market, credit, operational, and anti-money laundering. We also measure risk levels across the company and support monitoring and simulation functions by implementing an independently devel-oped OTC product calculation engine, incorporating vast market information and adopting sophisticated global best practices.

The potential for changes in the market value of our trading and investing positions is referred to as market risk. Such positions result from underwriting, brokerage, proprietary trading, and in-vestment activities. Market risk deals with potential losses due to fluctuations in market prices, interest rates, and exchange rates. We calculate VaR for all the assets we hold and for transactions that involve these risks. To complement VaR, Samsung Securities also uses various types of methods including Greeks, stress test-ing, and DV01 analysis.

Credit risk refers to potential losses that we would incur if a coun-terparty or an issuer of securities or other financial instruments that we hold fails to perform their obligations or upon a deteriora-tion in their credit quality. As part of our strict credit risk manage-ment policy, we assign credit ratings to counterparties based on our internal inspection and manage credit lines of each counter-part. Using SIRIS, we conduct daily monitoring of total credit ex-posure including counterparty exposure for over-the-counter de-rivatives. We effectively manage limits by identifying the individual counterparty limit prior to transactions involving credit exposure. Separate management of limits on large-sum margin lending is intended to prevent credit risk concentration. We are also building an effective system to prepare for future expansion of businesses involving credit risk by maintaining limits per business group and country. In the case of over-the-counter derivative trades, we re-quire the derivatives to be backed by collateral of above a certain amount or certain rating. This is to effectively manage various risks inherent in Over-the-counter derivatives. Samsung Securities enters into a contract with a counterparty for over-the-counter derivatives trading through the Master Agreements offered by the International Swap and Derivatives Association, Inc. (ISDA). We restrict derivatives transactions to counterparties who have signed a Credit Support Annex (CSA) with Samsung Securities. Through credit default swap (CDS) premium and news monitoring, we are proactively responding to the possible occurrence of credit events.

Liquidity risk refers to risk arising from a maturity mismatch in funding and investing. It stems from situations in which trading an asset at a previous price is impossible due to lack of transaction

or disruption in the market or when the company becomes default of payment due to a temporary increase in cash demand or credit crunch. Samsung Securities has established a number of strate-gies to deal with every possible type of liquidity crisis. All of them serve as the foundation for our overall emergency funding strate-gies. Since 2008, Samsung Securities has systematically man-aged operational risk by maintaining a unified system of internal controls and risk management organization. The SIRIS is used to manage and analyze company-wide data to keep operating risks at a level seen in leading global financial institutions.

As a way to make necessary improvements before accidents oc-cur, we rely on the Risk and Control Self Assessment (RCSA) to identify and manage risk factors and vulnerabilities. We have also developed and monitor Key Risk Indicators (KRI) related to opera-tional risks such as financial accidents, incomplete sales activities, transaction errors, and system failures. We also calculate opera-tional risk exposure by using a statistical tool that applies changes in the business environment and internal controls as well as loss-related data and scenarios.

Our rigorous operational risk management has reduced potential losses by recognizing and improving specific target risk factors. Furthermore, we are able to make efficient use of limited resourc-es and maintain business continuity through appropriate deploy-ment of management capabilities according to risk levels. We also secure the company's financial soundness by ensuring the avail-ability of sufficient cash flows based on an accurate projection of potential losses.

To manage regulatory risk that stems from various legal and regulatory changes, we assess related laws and regulations that are being established or revised, or that have been completed, and make relevant changes. To manage reputational risks arising from negative publicity and document risk from uncertain contract terms, each of our business divisions work organically with risk management, compliance, legal affairs and corporate commu-nication teams to analyze business activities that may affect the company as a whole or each operation to maintain risk within ac-ceptable levels.

Risk and Capital Adequacy

We are confident that our sound control framework will discipline risk capacity and enable us to remain a trusted financial partner to all of our clients.

Financial Perfo

rmance

Co

rpo

rate Resp

onsib

ility

Samsung Securities Report 2013 Financial Performance 44.45

Limit managementLimit management is a proactive management tool rather than passive management that limits sales activities of a company that entail risks. It minimizes interference in each department’s decision-making, while maintaining overall estimated losses within an acceptable range to maximize company-wide profit. Samsung Securities holds a wide range of trading securities, such as equi-ties, fixed income, and derivatives that are subject to trading limit management. Every year, Samsung Securities sets company-wide trading limits per risk type, which are approved by the Risk Management Committee.

The Risk Management Unit is responsible for overseeing trad-ing limits by category and type. It is also tasked with establishing countermeasures in the event of any violations of these regula-tions or limits. As key indicators for managing trading limits, we have adopted VaR limit, maximum loss limit, funds and loss limits. Greeks limit and DV01 limit are also used as additional indicators. VaR limit and loss limit are allocated in accordance with the com-pany's overall risk capital strategy. We have also established rules outlining how much limit management is to be applied to each major strategy. Support teams within each business division carry out our primary risk management functions, while the Risk Man-agement Unit oversees the entire operation.

VaR-based limits are used to measure and quantify an acceptable level of financial risk within a company or an investment portfolio over a specific time frame and in normal market conditions. Maxi-mum loss limit means the maximum amount of loss that a com-pany could suffer from its sales and management activities under a worst-case scenario.

Fund limit is calculated according to predetermined priorities to ensure the efficient use of a limited range of funds, while loss limit refers to the sum of both realized and unrealized losses. Yearly and monthly loss limits for each strategy are assigned. The term “Greeks limits” (i.e., Delta, Gamma, Vega, and Rho) refers to the limit of price sensitivity to such risk factors as share prices, volatility, and interest rates. It is used to manage risks of over-the-counter derivatives. The term DV01 bond evaluation refers to the change in the value of a sensitivity limit when the interest rate changes by 1 basis point. This limit is used to manage the rate of risk of fixed income instruments.

Samsung Securities manages its company-level VaR by applying diversification effects between its trading and non-trading assets within SIRIS. As of the end of February 2013, the VaR from our assets was worth KRW 47.0 billion, up KRW 3.3 billion over the year. The VaR of our equity-related assets decreased, while that from our interest rate-related assets grew. This happened be-cause our volume of equity-related asset fell during the year, while that of our interest rate -related assets increased.

Capital adequacyWe maintain an adequate level of capital to protect our investors and ensure our corporate stability in a rapidly changing market environment. Samsung Securities uses a net capital ratio to calcu-late its level of capital adequacy. The ratio is derived by comparing the level of market, credit, operational, and other risks that are present in our current asset position with our net operating capital. This helps us to gauge our ability to cope with the total amount of risk that we face.

The term “net operating capital” refers to the value of corporate assets that can be immediately converted into cash on the day the calculation is performed, meaning that it represents the true value of the assets being evaluated. It is calculated by subtract-ing the value of fixed and other illiquid assets from net assets and adding subordinated debt to the result.

FY 2013

Low

118

136

0

0

95

160

High

454

359

5

7

221

605

End of the year

153

352

0

0

35

470

Daily Average

185

312

1

1

59

441

FY 2012

End of the year

211

279

4

6

63

437

Equity

Interest Rates

FX

Other

Diversification (Overall)

Total VaR

VaR

Total risk amount refers to the maximum estimated loss that a company might face in the course of its operations, including market, counterparty, and operational risks. Market risk means the possible loss that would be faced if the values of a company’s trading assets were to be adversely affected in the future. Credit risk refers to the possible loss that a company would face if a counterparty or third party were to default on a financial obliga-tion. Operational risk means the possible loss faced in terms of expenditures or any deterioration in operating conditions if an ac-cident, error, illegal, or improper activity were to take place.

As of the end of December 2013, our net capital ratio recorded 636%, down 67% points from the previous year. This happened because the amount of our total risks and illiquid assets increased by KRW 15.4 billion and KRW 113.6 billion to KRW 393.2 billion and KRW 776.9 billion, respectively.

Market risk amount was KRW 294.5 billion in FY 2013, up KRW 31.4 billion from the previous year. Our amount of credit risk fell by KRW 12.8 billion to KRW 38.3 billion, after the calculation formula has been revised to reflect the total amount of loan collateral. Op-erating risk was KRW 60.4 billion, a drop of KRW 2.1 billion over the year.

Overview

Business P

erformance

Risk and

Cap

ital Ad

equacy

Financial Information

Net Capital Ratio

FY 2012

26,578

3,778

703%

FY 2011

24,970

2,800

892%

FY 2013

24,999

3,932

636%

(Y-Y)

-1,579

154

-67%p

Net capital (A)

Total risk amount

Net capital ratio (A/B)

Net operating capital

Total assets

Total liabilities

Illiquid assets

Subordinated debt

= - - +

Total risk Market risk Counterparty risk Operational risk = + +

Net capital ratio

Net capital

Total amount of risk

=

Financial Perfo

rmance

Co

rpo

rate Resp

onsib

ility

Samsung Securities Report 2013 Financial Performance 46.47

FINANCIAL INFORMATION

INDEPENDENT AUDITORS’ REPORT

To the Shareholders and Board of Directors ofSamsung Securities Co., Ltd.:

We have audited the accompanying consolidated financial statements of Samsung Securities Co., Ltd. and its subsidiaries (the “Group”). The consolidated financial statements consist of the consolidated statements of financial position as of December 31, 2013 and March 31, 2013, and the related consoli-dated statements of comprehensive income, consolidated statements of changes in shareholders’ equity and consolidated statements of cash flows for the nine months period ended December 31, 2013 and for the year ended March 31, 2013, all expressed in Korean won. The Group’s management is responsible for the preparation and fair presentation of the consolidated financial statements, and our responsibility is to express an opinion on these consolidated financial statements based on our audits. We did not audit the financial statements of Samsung Futures Inc., Samsung Securities (Europe) Ltd., Samsung Securi-ties (America) Inc., and Samsung Securities (Asia) Ltd., whose statements reflect total assets represent-ing 4.0% of the Group’s consolidated total assets as of December 31, 2013 and 5.8% as of March 31, 2013, and total net operating revenues representing 7.1% of the Group’s consolidated total net operating revenues for the nine months period ended December 31, 2013 and 6.6% for the year ended March 31, 2013. Those statements were audited by other auditors whose reports have been furnished to us, and our opinion expressed herein, insofar as it relates to the amounts included for those consolidated subsid-iaries, is based solely on the reports of the other auditors.

We conducted our audits in accordance with auditing standards generally accepted in the Republic of Ko-rea. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes ex-amining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material re-spects, the financial position of the Group as of December 31, 2013 and March 31, 2013, and the results of its operations and its cash flows for the nine months period ended December 31, 2013 and for the year March 31, 2013, in conformity with Korean International Financial Reporting Standards.

Accounting principles and auditing standards and their application in practice vary among countries. The accompanying consolidated financial statements are not intended to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally ac-cepted in countries other than the Republic of Korea. In addition, the procedures and practices utilized in the Republic of Korea to audit such consolidated financial statements may differ from those generally accepted and applied in other countries. Accordingly, this report and the accompanying consolidated fi-nancial statements are for use by those knowledgeable about Korean accounting principles and auditing standards and their application in practice.

March 6, 2014

This report is effective as of March 6, 2014, the auditors’ report date. Certain subsequent events or circum-stances may have occurred between the auditors’ report date and the time the auditors’ report is read. Such events or circumstances could significantly affect the accompanying consolidated financial statements and may result in modifications to the auditors’ report.

150-876, 9F, One IFC International Finance Centre Seoul,10, Gukjegeumyung-ro, Yeongdeungpo-gu, Seoul, Korea

Tel: +82 (2) 6676 1000Fax: +82 (2) 6674 2114www.deloitteanjin.co.kr

Overview

Business P

erform

anceR

isk and C

apital A

deq

uacy F

inancial Inform

ation

Financial Performance

Corporate R

esponsibility

Samsung Securities Report 2013 Financial Performance 48.49

CONSOLIDATED STATEMENTS OF FINANCIAL POSITIONAS OF DECEMBER 31, 2013 AND MARCH 31, 2013

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMEFOR THE NINE MONTHS PERIOD ENDED DECEMBER 31, 2013 AND FOR THE YEAR ENDED MARCH 31, 2013

SAMSUNG SECURITIES CO., LTD. AND ITS SUBSIDIARIES In thousands of KRW

Assets: Cash and cash equivalents Financialassetsatfairvaluethroughprofitorloss Available-for-salefinancialassets Loans and receivables Investment in associate Property and equipment Intangible assets Deferred income tax assets Current income tax assets Others Total assetsLiabilities: Financialliabilitiesatfairvaluethroughprofitorloss Depository liabilities Borrowings Debentures Definedbenefitliabilities Provisions Deferred income tax liabilities Current income tax liabilities Others Total liabilitiesShareholders’ equity: Capital stock Capital surplus Capital adjustments Accumulated other comprehensive income Retained earnings Equity attributable to the owners of the parent companyNon-controlling interests Totalshareholders’equity Totalliabilitiesandshareholders’equity

221,091,993

13,949,690,680

1,896,426,494

4,210,723,117

6,728,719

66,750,381

130,278,083

4,233,870

35,432,548

14,226,487

5,838,879,301

2,885,036,499

7,049,194,001

299,771,674

16,380,759

9,690,567

99,830,126

7,626,000

892,020,796

394,153,905

1,507,956,489

(105,670,638)

162,327,815

1,337,038,884

3,295,806,455

20,535,582,372

17,098,429,723

141,346,194

3,437,152,64920,535,582,372

461,226,645

(48,506,217)

367,438,996

(149,048,141)

253,515,981

798,961,073

293,329,928

(386,414,346)

(690,098,103)

(356,090,271)

54,654,170

(39,539,267)

11,034,525

12,989,505

2,552,666

(7,811,659)

(5,455,906)

1,178,223

12,130,908

412,720,428

218,390,855

(86,795,738)

15,114,903

559,430,448268,301,908252,439,938

38,688,6022,277,0165,301,066

35,664,55211,640,52224,024,030

(10,714,899)

13,309,131

148

148

260,377,190

13,081,765,115

1,336,460,882

4,561,824,190

8,028,487

81,715,538

127,743,120

3,595,643

741,838

18,665,790

6,118,653,416

2,977,019,973

5,326,268,928

299,460,035

22,051,163

10,468,815

102,269,610

9,316,271

1,132,931,410

394,153,905

1,506,982,289

(105,016,066)

172,184,117

1,374,368,262

3,342,672,507

19,480,917,793

15,998,439,621

139,805,665

3,482,478,17219,480,917,793

652,269,339

(74,091,244)

453,261,099

(197,097,524)

452,369,536

761,884,551

351,134,330

(332,073,448)

(731,481,736)

(409,708,223)

79,319,470

(37,975,833)

163,704,845

17,020,084

(6,403,911)

(3,332,787)

(2,525,278)

152,058,814

16,404,139

578,178,095

256,163,575

92,125,010

41,343,637

967,810,317382,323,724347,948,424237,538,169

5,164,1439,896,180

232,806,13252,081,203

180,724,929

(12,261,976)

168,462,953

2,200

2,200

December 31, 2013 December 31, 2013March 31, 2013 March 31, 2013

SAMSUNG SECURITIES CO., LTD. AND ITS SUBSIDIARIES In thousands of KRW

Commissions income and expenses, net: Commissions income Commissions expensesInterest income and expenses, net: Interest income Interest expensesGains or losses on financial instrument at fair value through profit or loss, net: Gainsrelatedtofinancialinstrumentsheldfortrading Gains related to derivatives held for trading Gainsrelatedtofinancialinstrumentsdesignatedatfairvaluethroughprofitorloss Lossesrelatedtofinancialinstrumentsheldfortrading Losses related to derivatives held for trading LossesrelatedtofinancialinstrumentsdesignatedatfairvaluethroughprofitorlossOther operating income and expenses: Other operating income Other operating expensesOperating revenues, netEmployee compensation and benefitsSelling and administrative expensesOperating profitNon-operating incomeNon-operating expensesProfit before income taxIncome tax expenseNet income Profitattributableto: Owners of the parent company Non-controlling interestsOther comprehensive income, net of tax: Itemnotsubsequentlyreclassifiedtonetincome: Remeasurementofthenetdefinedbenefitliabilities Itemssubsequentlyreclassifiedtonetincome: Valuationlossonavailable-for-salefinancialassets Cumulative translation adjustments for overseas subsidiaries and branchesTotal comprehensive income Comprehensiveincomeattributableto: Owners of the parent company Non-controlling interests Earnings per share (In Korean won): Basic earnings per share Diluted earnings per share

Overview

Business P

erform

anceR

isk and C

apital A

deq

uacy F

inancial Inform

ation

Financial Performance

Corporate R

esponsibility

Samsung Securities Report 2013 Financial Performance 50.51

394,153,905

-

394,153,905

-

-

-

-

-

-

-

394,153,905

394,153,905-

-

-

-

-

-

-

-

394,153,905

1,505,276,083

-

1,505,276,083

-

-

-

-

-

1,286,695

419,511

1,506,982,289

1,506,982,289-

-

-

-

-

53,862

926,987

(6,649)

1,507,956,489

(99,529,719)

-

(99,529,719)

-

-

-

-

-

1,791,483

(7,277,830)

(105,016,066)

(105,016,066)-

-

-

-

-

158,640

(813,212)

-

(105,670,638)

200,616,859

(16,786,711)

183,830,148

-

-

(5,907,296)

(3,271,873)

(2,466,862)

-

-

172,184,117

172,184,117-

-

2,455,306

(6,983,064)

(5,328,544)

-

-

-

162,327,815

1,245,937,332

16,786,711

1,262,724,043

(52,060,626)

163,704,845

-

-

-

-

-

1,374,368,262

1,374,368,262(48,363,903)

11,034,525

-

-

-

-

-

-

1,337,038,884

3,246,454,460

-

3,246,454,460

(52,060,626)

163,704,845

(5,907,296)

(3,271,873)

(2,466,862)

3,078,178

(6,858,319)

3,342,672,507

3,342,672,507(48,363,903)

11,034,525

2,455,306

(6,983,064)

(5,328,544)

212,502

113,775

(6,649)

3,295,806,455

133,967,089

-

133,967,089

(10,565,564)

17,020,085

(496,615)

(60,914)

(58,416)

-

-

139,805,665

139,805,665(10,565,564)

12,989,505

97,360

(828,595)

(127,362)

-

-

(24,815)

141,346,194

3,380,421,549

-

3,380,421,549

(62,626,190)

180,724,930

(6,403,911)

(3,332,787)

(2,525,278)

3,078,178

(6,858,319)

3,482,478,172

3,482,478,172(58,929,467)

24,024,030

2,552,666

(7,811,659)

(5,455,906)

212,502

113,775

(31,464)

3,437,152,649

Overview

Business P

erform

anceR

isk and C

apital A

deq

uacy F

inancial Inform

ation

Financial Performance

Corporate R

esponsibility

Samsung Securities Report 2013 Financial Performance 52.53

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITYFOR THE NINE MONTHS PERIOD ENDED DECEMBER 31, 2013AND FOR THE YEAR ENDED MARCH 31, 2013

CONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE NINE MONTHS PERIOD ENDED DECEMBER 31, 2013AND FOR THE YEAR ENDED MARCH 31, 2013

SAMSUNG SECURITIES CO., LTD. AND ITS SUBSIDIARIES In thousands of KRW

Balance as of April 1, 2012Cumulative effect on change of accounting policyBalance after adjustmentDividendsNet incomeOther comprehensive income, net of tax: Remeasurement of the net defined benefit liabilities Valuation loss on available-for- sale financial assets Cumulative translation adjustments for overseas subsidiaries and branchesDisposal of treasury stockOthersBalance as of March 31, 2013

Balance as of April 1, 2013DividendsNet incomeOther comprehensive income, net of tax: Remeasurement of the net defined benefit liabilities Valuation loss on available-for- sale financial assets Cumulative translation adjustments for overseas subsidiaries and branchesDisposal of treasury stockOthersAcquisition of treasury stockBalance as of December 31, 2013

Capital stock

Capital surplus

Capital adjustments

Accumulated other

Comprehensive income

Retainedearnings

Total

Non-controllinginterests

Total equity

24,024,030

(271,327,288)

(921,919,284)

331,098,245

(134,532,777)

9,563,171

(45,110,095)

411,239,977

-

109,920,071

1,227,446

3,538,263

124,470

971,554

(975,770,216)

(107,443,344)

(7,891,835)

(23,233,392)

1,617,264,516

165,125

(58,929,467)

(31,464)

(1,008,203,998)

(587,317,006)

1,558,468,710(2,232,903)

(39,285,197)260,377,190221,091,993

180,724,929

(326,184,676)

(1,008,160,049)

456,467,636

(186,805,196)

19,343,374

(30,710,597)

1,892,447,134

10,000,000

165,847,165

2,028,289

-

332,121

3,881,940

(1,587,477,222)

(180,127,145)

(12,944,287)

(31,442,715)

579,158,571

-

(62,626,190)

-

(895,324,579)

262,545,280

516,532,381(1,397,925)

(117,644,843)378,022,033260,377,190

December 31, 2013 March 31, 2013

SAMSUNG SECURITIES CO., LTD. AND ITS SUBSIDIARIES In thousands of KRW

Cash flows from operating activities: Net income Adjustments Changes in operating assets and liabilities Interest received Interest paid Dividend received Income tax paid Net cash used in operating activitiesCash flows from investing activities: Proceeds from disposal of available-for-sale financial assets Decrease in held-to-maturity investments Decrease in loans and receivables Disposal of the investment in associates Net cash provided by acquisition of subsidiary Proceeds from disposal of property and equipment Proceeds from disposal of intangible assets Acquisition of available-for-sale financial assets Increase in loans and receivables Acquisition of property and equipment Acquisition of intangible assets Net cash provided by (used in) investing activitiesCash flows from financing activities: Net increase in borrowings Proceeds from disposal of treasury stock Payment of dividends Proceeds from acquisition of treasury stock Net cash provided by financing activitiesChanges in cash and cash equivalents by foreign currency translationNet decrease in cash and cash equivalentsCash and cash equivalents, beginning of the yearCash and cash equivalents, end of the year

Overview

Business P

erform

anceR

isk and C

apital A

deq

uacy F

inancial Inform

ation

Financial Performance

Corporate R

esponsibility

Samsung Securities Report 2013 Financial Performance 54.55

SEPARATE STATEMENTS OF FINANCIAL POSITIONAS OF DECEMBER 31, 2013 AND MARCH 31, 2013

SEPARATE STATEMENTS OF COMPREHENSIVE INCOMEFOR THE NINE MONTHS PERIOD ENDED DECEMBER 31, 2013 AND FOR THE YEAR ENDED MARCH 31, 2013

SAMSUNG SECURITIES CO., LTD. In thousands of KRW

Assets: Cash and cash equivalents Financial assets at fair value through profit or loss Available-for-sale financial assets Loans and receivables Investments in associates and subsidiaries Property and equipment Intangible assets Current income tax assets Others Total assetsLiabilities: Financial liabilities at fair value through profit or loss Depository liabilities Borrowings Debentures Defined benefit liabilities, net Provisions Deferred income tax liabilities Others Total liabilitiesShareholders’ equity: Capital stock Capital surplus Capital adjustments Accumulated other comprehensive income Retained earnings (Reserves for credit losses: December 31, 2013: ￦7,943,303 thousand March 31, 2013: ￦5,794,162 thousand Expected reserves for credit losses: December 31, 2013: ￦1,184,771 thousand March 31, 2013: ￦2,149,141 thousand) Total shareholders’ equity Total liabilities and shareholders’ equity

170,251,903

13,878,917,370

1,835,754,216

3,119,230,657

283,154,393

60,805,520

110,536,361

35,119,049

11,227,538

5,838,879,301

2,086,441,276

7,032,050,609

299,771,674

14,876,330

9,061,678

93,905,525

857,358,271

394,153,905

1,507,963,137

(105,670,638)

170,901,384

1,305,304,555

19,504,997,007

16,232,344,664

3,272,652,34319,504,997,007

325,609,855

(42,900,888)

348,267,926

(142,898,391)

252,476,732

798,471,015

293,301,197

(385,396,599)

(689,645,858)

(356,090,271)

68,618,633

(37,353,608)

2,364,476

(6,217,778)

(239,500)

(135,994)

(153,543)

282,708,967

205,369,535

(86,883,784)

31,265,025

432,459,743215,033,053210,199,341

7,227,3495,397,1603,799,0448,825,465

439,780

8,385,685(4,382,339)

4,003,346

113113

234,088,901

13,081,765,115

1,273,498,891

3,309,012,477

285,420,424

74,055,530

110,182,673

365,760

14,092,159

6,118,653,416

2,038,703,953

5,381,317,877

299,460,035

21,063,583

9,859,803

96,033,869

1,100,702,770

394,153,905

1,506,982,289

(105,016,065)

175,283,723

1,345,282,772

18,382,481,930

15,065,795,306

3,316,686,62418,382,481,930

476,344,291

(66,699,460)

418,614,184

(185,195,761)

452,369,536

761,868,545

351,134,330

(332,073,448)

(731,358,878)

(409,708,223)

84,373,830

(37,349,525)

(5,142,268)

7,570,458

(5,172,123)

230,601

(171,131)

409,644,831

233,418,423

92,231,862

47,024,305

782,319,421313,473,222290,207,030178,639,169

10,989,74220,002,515

169,626,39639,051,008

130,575,388(2,684,463)

127,890,925

1,7551,755

December 31, 2013 December 31, 2013March 31, 2013 March 31, 2013

SAMSUNG SECURITIES CO., LTD. In thousands of KRW

Commissions income and expenses, Net: Commissions income Commissions expensesInterest income and expenses, net: Interest income Interest expensesGains or losses on financial instrument at fair value through profit or loss, net: Gains related to financial instruments held for trading Gains related to derivatives held for trading Gains related to financial instruments designated at fair value through profit or loss Losses related to financial instruments held for trading Losses related to derivatives held for trading Losses related to financial instruments designated at fair value through profit or lossOther operating income and expenses: Other operating income Other operating expensesOperating revenues, netEmployee compensation and benefitsSelling and administrative expensesOperating profitNon-operating incomeNon-operating expensesProfit before income taxIncome tax expenseNet income (Net income after reserves for credit losses: December 31, 2013: ￦7,200,915 thousand March 31, 2013: ￦128,426,248 thousand)Other comprehensive income, net of tax: Item not subsequently reclassified to net income: Remeasurement of the net defined benefit liabilities Items subsequently reclassified to net income: Valuation gain (loss) on available-for-sale financial assets Change in value of investments in subsidiaries Change in value of investments in associates Cumulative translation adjustments for overseas subsidiaries and branchesTotal comprehensive incomeEarnings per share (In Korean won): Basic earnings per share Diluted earnings per share

Overview

Business P

erform

anceR

isk and C

apital A

deq

uacy F

inancial Inform

ation

Financial Performance

Corporate R

esponsibility

Samsung Securities Report 2013 Financial Performance 56.57

3,244,636,4653,244,636,465

-

(52,060,625)

130,575,388

(5,142,268)

7,570,458

(5,172,123)

230,601

(171,131)

3,078,178

(6,858,319)

3,316,686,624

3,316,686,624(48,363,902)

8,385,685

2,364,476

(6,217,778)

(239,500)

(135,994)

(153,543)

212,500

113,775

3,272,652,343

SEPARATE STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITYFOR THE NINE MONTHS PERIOD ENDED DECEMBER 31, 2013AND FOR THE YEAR ENDED MARCH 31, 2013

SEPARATE STATEMENTS OF CASH FLOWSFOR THE NINE MONTHS PERIOD ENDED DECEMBER 31, 2013AND FOR THE YEAR ENDED MARCH 31, 2013

SAMSUNG SECURITIES CO., LTD. In thousands of KRW

Balance as of April 1, 2012Balance after adjustmentCumulative effect on change of accounting policyDividendsNet incomeOther comprehensive income, net of tax: Remeasurement of the net defined benefit liabilities Valuation gain (loss) on available-for-sale financial assets Changes in value of investments in subsidiaries Changes in value of investments in associates Cumulative translation adjustments for overseas subsidiaries and branchesDisposal of treasury stockOthersBalance as of March 31, 2013

Balance as of April 1, 2013DividendsNet incomeOther comprehensive income, net of tax: Remeasurement of the net defined benefit liabilities Valuation gain (loss) on available-for-sale financial assets Changes in value of investments in subsidiaries Changes in value of investments in associates Cumulative translation adjustments for overseas subsidiaries and branchesDisposal of treasury stockOthersBalance as of December 31, 2013

394,153,905394,153,905

-

-

-

-

-

-

-

-

-

-

394,153,905

394,153,905-

-

-

-

-

-

-

-

-

394,153,905

1,505,276,0831,505,276,083

-

-

-

-

-

-

-

-

1,286,695

419,511

1,506,982,289

1,506,982,289-

-

-

-

-

-

-

53,861

926,987

1,507,963,137

(99,529,718)(99,529,718)

-

-

-

-

-

-

-

-

1,791,483

(7,277,830)

(105,016,065)

(105,016,065)-

-

-

-

-

-

-

158,639

(813,212)

(105,670,638)

193,634,965177,968,186

(15,666,779)

-

-

(5,142,268)

7,570,458

(5,172,123)

230,601

(171,131)

-

-

175,283,723

175,283,723-

-

2,364,476

(6,217,778)

(239,500)

(135,994)

(153,543)

-

-

170,901,384

1,251,101,2301,266,768,009

15,666,779

(52,060,625)

130,575,388

-

-

-

-

-

-

-

1,345,282,772

1,345,282,772(48,363,902)

8,385,685

-

-

-

-

-

-

-

1,305,304,555

Capital stock

Capital surplus

Capital adjustments

Accumulated other

Comprehensive income

Retainedearnings

Total equity

8,385,685

(296,142,107)

(871,859,323)

311,265,234

(128,445,940)

31,721,424

(35,972,892)

399,207,213

9,786,360

2,423,823

15,767

21,070

(962,209,585)

(2,993,992)

(6,863,635)

(17,689,601)

1,543,886,323

165,125

(48,363,903)

(981,047,919)

(578,302,580)

1,495,687,545(174,044)

(63,836,998)234,088,901170,251,903

130,575,388

(322,509,942)

(1,027,576,163)

419,697,091

(174,047,332)

37,000,718

(10,738,000)

1,863,857,216

23,036

14,001,289

58,751

3,309,228

(1,569,729,198)

-

(11,561,843)

(29,079,211)

634,209,577

-

(52,060,625)

(947,598,240)

270,879,268

582,148,952822,527

(93,747,493)327,836,394234,088,901

December 31, 2013 March 31, 2013

SAMSUNG SECURITIES CO., LTD. In thousands of KRW

Cash flows from operating activities: Net income Adjustments Changes in operating assets and liabilities Interest received Interest paid Dividend received Income tax paid Net cash used in operating activitiesCash flows from investing activities: Proceeds from disposal of available-for-sale financial assets Proceeds from disposal of loans and receivables Proceeds from disposal of investments in associates and subsidiaries Proceeds from disposal of property and equipment Proceeds from disposal of intangible assets Acquisition of available-for-sale financial assets Acquisition of loans and receivables Acquisition of property and equipment Acquisition of intangible assets Net cash provided by (used in) investing activitiesCash flows from financing activities: Net increase in borrowings Proceeds from disposal of treasury stock Payment of dividends Net cash provided by financing activitiesChanges in cash and cash equivalents by foreign currency translationNet decrease in cash and cash equivalentsCash and cash equivalents, beginning of the yearCash and cash equivalents, end of the year

APPENDIX

MAJOR ACCOUNTING PRINCIPLES

Accounting PolicyOur financial statements follow the Korean International Financial Reporting Standards (K-IFRS) beginning the reporting period commending April 1, 2011. K-IFRS is the Korean version of standards, revisions and interpretations issued by the International Accounting Standards Board (ISAB). For comparison purposes, we made corrections to prior-period financial statements as well as those as at the date of the conversion.

Major changes entailed by the adoption of K-IFRS are as follows:

Switch to consolidated financial statements Wider scope of financial product disclosures (fair value disclosures, risk disclosures, etc.) Recognition of day 1 profit and loss according to fair value of marketable securities and derivatives Reflection of credit spread when calculating fair value of financial products Recognition of defined benefit obligation

Accounting TreatmentRecognition and Measurement of Financial Instruments

Standard transactions of financial assets are recognized on the date of transaction. All financial assets excluding financial assets at fair value

through profit or loss are initially recognized at fair value plus transaction costs. Financial assets at fair value through profit or loss are initially recognized at fair value and transaction costs are recorded in the income statement. Available-for-sale financial assets and financial assets at fair value through profit or loss are subsequently measured at fair value. Loans, receivables and financial assets held to maturity are measured at amortized cost using the effective interest method.

DerivativesDerivatives are initially recognized at fair value at the date a derivative contract is entered into and are subsequently reassessed to their fair value. Gains or losses on valuation of derivatives for trading purposes are recognized as net trading income or loss in the statement of comprehensive income.

Day 1 profit and lossWhere the company assesses fair value of OTC derivatives using inputs that are not from observable market data, the difference between the fair value on initial recognition and the transaction price (Day 1 profit and loss) is not recognized as profit or loss for the current term but deferred. The difference is amortized over the life of the transaction of the instrument using the straight-line method. When the valuation methods become observable in the market, the deferred balance is immediately recognized in the statement of comprehensive income as profit or loss for the current term.

Defined benefit obligationsDefined benefit plans refer to all pension plans excluding defined contribution plans which define the amount of pension benefits employees receive when they retire based on the age, service period and wage levels. Defined benefit obligation recorded in the statement of financial position is the present value of defined benefit obligation as of the end of the reporting period less the fair value of plan assets and less past service cost not yet recognized. Defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method.

Samsung Securities Report 2013 Appendix 58.59

INDEPENDENT ASSURANCE REPORT

To the Stakeholders of Samsung SecuritiesKorea Productivity Center (KPC) are requested by Samsung Securities Co., Ltd. (Samsung Securities) to perform independent assurance on the information specified in 2013 Samsung Securities’ Sustainability Report (Report) and hereby present our assurance statements.

Responsibility and IndependenceSamsung Securities entitles full responsibility for the information and opinions specified in the Report. KPC is responsible for the assurance statement on the Report. As an independent assurance agency, KPC was neither involved in the preparation of the report nor maintains any relationship that can undermine its state of independence.

Assurance StandardThe following assurance process was performed in accordance with Type 1 and Moderate level of the AA1000AS(2008) Assurance Standard. KPC verified the suitability of inclusivity, materiality, and responsiveness based on the AA1000APS(2008) Assurance Principle. Moreover, KPC checked whether the Report was prepared in compliance with GRI G3.1 Guideline.

LimitationsIn accordance with the above assurance standard, KPC performed assurance on Samsung Securities’ performances in 2013. The assurance agency did not perform verification on some of the data such as financial performances and information on homepage. Furthermore, on-site inspection was limited to the headquarter in Seoul, Republic of Korea, and the result may change if further assurance process is performed.

MethodologyKPC performed assurance on the Report by using the methodology listed below:

1. Reviewing the reporting coverage and descriptions on each indicator in GRI G3.1 Guideline to verify whether the requirements for the GRI Application level A are met. 2. Verifying the compliance of the principles on the content and quality of the Report using GRI G3.1 Guideline.3. Implementing media research and benchmarking analysis to check the selection of material issues and the appropriateness of descriptions in the Report.4. Comparing and analyzing the content of the Report with other reports from different sources to check the appropriateness and errors in depiction of the content. 5. Conducting on-site inspection on the headquarter in Seoul, Republic of Korea, to verify the source of major data and information and to check the internal process and system.

Findings and ConclusionKPC verified that the Report fairly and accurately reflects Samsung Securities’ sustainability management activities and performances. Furthermore, the assurance finds that the Report meets the requirements of GRI Application level A as claimed by Samsung Securities. The assurance conclusion on the AA1000(2008) principles of inclusivity, materiality, and responsiveness AA1000(2008) is as follows:

1.Inclusivity : Stakeholder ParticipationThe principle of inclusivity articulates that organization should involve stakeholders in the process of developing and achieving responsible and strategic response to sustainability. Samsung Securities proves to have an effective communication system by operating a communication channel to take in diverse opinions from customer-based stakeholders. The company recognized stakeholders’ needs by observing issues that were raised in each channel. Moreover, Samsung Securities strived to apply these needs into management.

2. Materiality : Significant Issue Identification and ReportingThe principle of materiality states that organization should determine issues that are relevant and material to both the organization and its key stakeholders. KPC found that Samsung Securities used internal and external environment analysis to recognize and understand key sustainability issues. In this process, it is necessary to widen discussions with departments that are related to each issue. KPC recommends Samsung Securities to present the objective and performance of each issue and to build an internal reporting system to continue reporting key issues drawn from the materiality test.

3. Responsiveness: Response Toward IssuesThe principle of responsiveness articulates that organization should be responsive to issues that can have impacts on stakeholders’ performances. Samsung Securities identified stakeholders’ key expectations, engaged in responsive activities, and presented relevant information in the Report. In particular, Samsung Securities is appropriately reporting 2013 responsive activities on key issues such as corporate governance, risk management, ethical management, customer rights, organization culture, and contribution to local community. In the future, reporting a background and necessity of each issue may be needed to show characteristics and changes in Samsung Securities’ major activities.

RecommendationKPC commends Samsung Securities’ effort and performance to improve its sustainability and provides the following recommendations to improve on future sustainability reports and sustainability management: 1. We recommend Samsung Securities to consider factors that affect financial performance in addition to social and environmental factors during the material test. If Samsung Securities can portray in the report that its key issues are related not only to the social responsibilities but also to the company’s financial performances, its value of sustainability report will be appreciated as a form of an integrated report. 2. It is necessary to approach Samsung Securities’ internal activities in different perspectives. We recommend Samsung Securities to report whether the repeated issues require separate considerations or reviews each year and any activity that the company initiated regarding the repeated issues. By doing this, Samsung Securities can present its diverse effort to increase the sustainability. 3. It is necessary to analyze the effects of issues drawn from the material test on Samsung Securities and society. The analysis makes internal discussions regarding responsive activities possible and it can set Samsung Securities’ direction of social responsibility management. We recommend these series of activities to be presented in the Report.

The Sustainable Management Center of Korea Productivity Center is an assurance agency certified by AccountAbility, an institution that establishes global international standards AA 1000 for stakeholder participation and verifications, thereby qualified to conduct assurance on an independent basis. Moreover, our Assurance Committee is consisted of competent experts, who have ample experiences in sustainability management consulting and assurance and have completed relevant professional training.

April, 2014Korea Productivity Center Hong JinChairman

Dong Soo KimDirector

Yang Ho LeeTeam Leader

Seung Tae JungResearcher

Samsung Securities Report 2013 Appendix 60.61

Report Profile

GRI INDEX Fully Reported Partially Reported Non-reported

Statement from the most senior decision maker of the organization

Description of key impacts, risks, and opportunities

Name of the organization

Primary brands, products, and/or services

Operational structure of the organization, including main divisions, operating companies, subsidiaries, and joint ventures

Location of organization’s headquarters

Number of countries where the organization operates, and names of countries with either major operations or that are specifically relevant to the sustainability issues covered in the report

Nature of ownership and legal form

Markets served (including geographic breakdown, sectors served, and types of clients/beneficiaries)

Scale of the reporting organization

Significant changes during the reporting period regarding size, structure, or ownership

Awards received in the reporting period

Reporting period (e.g., fiscal/calendar year) for information provided

Date of most recent previous report (if any)

Reporting cycle (annual, biennial, etc.)

Contact point for questions regarding the report or its contents

Process for defining report content

Boundary of the report (e.g., countries, divisions, subsidiaries, leased facilities, joint ventures, suppliers). See GRI Boundary Protocol for further guidance

State any specific limitations on the scope or boundary of the report (see completeness principle for explanation of scope)

Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations, and other entities that can significantly affect comparability from period to period and/or between organizations

Data measurement techniques and the bases of calculations, including assumptions and techniques underlying estimations applied to the compilation of the Indicators and other information in the report. Explain any decisions not to apply, or to substantially diverge from, the GRI Indicator Protocols

Explanation of the effect of any re-statements of information provided in earlier reports, and the reasons for such re-statement (e.g., mergers/acquisitions, change of base years/periods, nature of business, measurement methods)

Significant changes from previous reporting periods in the scope, boundary, or measurement methods applied in the report

Table identifying the location of the Standard Disclosures in the report

Policy and current practice with regard to seeking external assurance for the report

Governance structure of the organization, including committees under the highest governance body responsible for specific tasks, such as setting strategy or organizational oversight

Indicate whether the Chair of the highest governance body is also an executive officer

For organizations that have a unitary board structure, state the number of members of the highest governance body that are independent and/or non-executive members

Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body

Linkage between compensation for members of the highest governance body, senior managers, and executives (including departure arrangements), and the organization's performance (including social and environmental performance)

Processes in place for the highest governance body to ensure conflicts of interest are avoided

Process for determining the composition, qualifications, and expertise of the members of the highest governance body and its committees, including any consideration of gender and other indicators of diversity

Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental, and social performance and the status of their implementation

Procedures of the highest governance body for overseeing the organization's identification and management of economic, environmental, and social performance, including relevant risks and opportunities, and adherence or compliance with internationally agreed standards, codes of conduct, and principles

Processes for evaluating the highest governance body’s own performance, particularly with respect to economic, environmental, and social performance

Explanation of whether and how the precautionary approach or principle is addressed by the organization

Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organization subscribes or endorses

Memberships in associations (such as industry associations) and/or national/international advocacy organizations in which the organization: * Has positions in governance bodies; * Participates in projects or committees; * Provides substantive funding beyond routine membership dues; or * Views membership as strategic

List of stakeholder groups engaged by the organization

Basis for identification and selection of stakeholders with whom to engage

Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group

Key topics and concerns that have been raised through stakeholder engagement, and how the organization has responded to those key topics and concerns, including through its reporting

Strategy and

Analysis

Organizational

Profile

Report Param-

eters

Governance,

Commitments,

and Engage-

ment

8~10

22~23

66

16~19

66

66

66

66

66

50~57, 66

-

12~13

0

67

0

66

22~23

0

0

0

38

-

-

62~65

60~61

25~26

25~26

25~26

25~26

25~26

25~26

25~26

1~7

25~26

25~26

27~29, 44~47

0

0

22~23

22~23

22~23

22~23

Letter from the CEO

Our Stakeholders & Issues

Corporate Information

Business Overview

Organizational Chart

Corporate Information

Corporate Information

Corporate Information

Corporate Information

Financial Information, Corporate Information

None

Awards received in 2013

Reporting Period

Recent Report

Significance of the Report

Corporate Information

Our Stakeholders & Issues

Reporting Scope

Reporting Scope

Reporting Scope

For the Community

None

None

GRI Index

Independent Assurance Report

Corporate Governance

Corporate Governance

Corporate Governance

Corporate Governance

Corporate Governance

Corporate Governance

Corporate Governance

Client-oriented Management

Corporate Governance

Corporate Governance

Risk Management, Risk and Capital Adequacy

CDP signed institutes

Incorporated into DJSI

Our Stakeholders & Issues

Our Stakeholders & Issues

Our Stakeholders & Issues

Our Stakeholders & Issues

1.1

1.2

2.1

2.2

2.3

2.4

2.5

2.6

2.7

2.8

2.9

2.10

3.1

3.2

3.3

3.4

3.5

3.6

3.7

3.8

3.9

3.10

3.11

3.12

3.13

4.1

4.2

4.3

4.4

4.5

4.6

4.7

4.8

4.9

4.10

4.11

4.12

4.13

4.14

4.15

4.16

4.17

Classification Index Details Page Disclosure Level

Report of Samsung Securities

Samsung Securities Report 2013 Appendix 62.63

Economic Performance Indicators

Management approach to create economic performances

Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments

Financial implications and other risks and opportunities for the organization’s activities due to climate change

Coverage of the organization’s defined benefit plan obligations

Significant financial assistance received from government

Range of ratios of standard entry-level wage by gender compared to local minimum wage at significant locations of operation

Policy, practices, and proportion of spending on locally based suppliers at significant locations of operation

Procedures for local hiring and proportion of senior management hired from the local community at locations of significant operation

Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, in-kind, or pro bono engagement

Understanding and describing significant indirect economic impacts, including the extent of impacts

Management approach to create social (labor) performances

Total workforce by employment type, employment contract, and region, broken down by gender

Total number and rate of new employee hires and employee turnover by age group, gender, and region

Benefits provided to full-time employees that are not provided to temporary or part-time employees, by major operations

Percentage of employees covered by collective bargaining agreements

Minimum notice period (s) regarding significant operational changes, including whether it is specified in collective agreements

Percentage of total workforce represented in formal joint management-worker health and safety committees that help monitor and advise on occupational health and safety programs

Rates of injury, occupational diseases, lost days, and absenteeism, and number of work-related fatalities by region and by gender

Education, training, counseling, prevention, and risk-control programs in place to assist workforce members, their families, or community members regarding serious diseases

Health and safety topics covered in formal agreements with trade unions.

Average hours of training per year per employee by gender, and by employee category

Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings

Percentage of employees receiving regular performance and career development reviews, by gender

Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity

Ratio of basic salary and remuneration of women to men by employee category, by significant locations of operation

Return to work and retention rates after parental leave, by gender

Management approach to create social (human rights) performances

Percentage and total number of significant investment agreements and contracts that include clauses incorporating human rights concerns, or that have undergone human rights screening

Percentage of significant suppliers, contractors and other business partners that have undergone human rights screening, and actions taken

Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained

Total number of incidents of discrimination and corrective actions taken

Operations and significant suppliers identified in which the right to exercise freedom of association and collective bargaining may be violated or at significant risk, and actions taken to support these rights

Operations and significant suppliers identified as having significant risk for incidents of child labor, and measures taken to contribute to the effective abolition of child labor

Operations and significant suppliers identified as having significant risk for incidents of forced or compulsory labor, and measures to contribute to the elimination of all forms of forced or compulsory labor

Percentage of security personnel trained in the organization's policies or procedures concerning aspects of human rights that are relevant to operations

Total number of incidents of violations involving rights of indigenous people and actions taken

Percentage and total number of operations that have been subject to human rights reviews and/or impact assessments

Number of grievances related to human rights filed, addressed and resolved through formal grievance mechanisms

DMA

Economic

performances

Market pres-

ence

Indirect eco-

nomic impacts

DMA

Employment

Labor Manage-

ment Relations

Occupational

health and

safety

Training and

education

Diversity and Equal Opportu-

nity

DMA

Investment and

procurement

practices

Non-discrimination

Freedom ofassociation and collective bargaining

Child labor

Forced and compulsory labor

Security practices

Indigenous rights

Assessment

Remediation

16~19

14

38

34

-

-

-

-

36~37

36~37

33

35

35

35

34~35

34~35

34~35

34~35

34~35

34~35

33

34

35

25~26, 35

33

35

33

33~35

33~35

33~35

-

33~35

34

34

35-

-

34

N/A

N/A

N/A

N/A

Business Overview

Financial Highlight & Economic Flow

For the Community

For the Employees

None

-

Not applicable due to the nature of the business

Not applicable due to the nature of the recent businesses

For the Community

For the Community

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

Corporate Governance, For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

For the Employees

None

For the Employees

For the Employees

For the Employees

For the Employees

Not applicable due to the nature of the business

Not applicable due to the nature of the business

For the Employees

EC1

EC2

EC3

EC4

EC5

EC6

EC7

EC8

EC9

LA1

LA2

LA3

LA4

LA5

LA6

LA7

LA8

LA9

LA10

LA11

LA12

LA13

LA14

LA15

HR1

HR2

HR3

HR4

HR5

HR6

HR7

HR8

HR9

HR10

HR11

Classification Index Details Page Disclosure Level

Report of Samsung Securities

Labor Performance Indicators

Human Rights Performance Indicators

Management approach to create social (human rights) performances

Percentage of operations with implemented local community engagement, impact assessments, and development programs

Percentage and total number of business units analyzed for risks related to corruption

Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity.

Actions taken in response to incidents of corruption

Public policy positions and participation in public policy development and lobbying

Total value of financial and in-kind contributions to political parties, politicians, and related institutions by country

Total number of legal actions for anti-competitive behavior, anti-trust, and monopoly practices and their outcomes

Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with laws and regulations

Operations with significant potential or actual negative impacts on local communities

Prevention and mitigation measures implemented in operations with significant potential or actual negative impacts on local communities

Percentage of operations with implemented local community engagement, impact assessments, and development programs.

Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant products and services categories subject to such procedures

Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle, by type of outcomes

Type of product and service information required by procedures, and percentage of significant products and services subject to such information requirements

Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcomes

Practices related to client satisfaction, including results of surveys measuring client satisfaction

Programs for adherence to laws, standards, and voluntary codes related to marketing communications, including advertising, promotion, and sponsorship

Total number of incidents of non-compliance with regulations and voluntary codes concerning marketing communications, including advertising, promotion, and sponsorship by type of outcomes

Total number of substantiated complaints regarding breaches of client privacy and losses of client data

Monetary value of significant fines for non-compliance with laws and regulations concerning the provision and use of products and services

Management approach to create environmental performances

Materials used by weight or volume

Percentage of materials used that are recycled input materials

Direct energy consumption by primary energy source

Indirect energy consumption by primary source

Energy saved due to conservation and efficiency improvements

Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in energy requirements as a result of such initiatives

Initiatives to reduce indirect energy consumption and reductions achieved.

Total water withdrawal by source

Water sources significantly affected by withdrawal of water

Percentage and total volume of water recycled and reused

Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas

Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas

Habitats protected or restored

Strategies, current actions, and future plans for managing impacts on biodiversity

Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk

DMA

Local communities

Corruption

Public Policy

Anti-CompetitiveBehavior

Compliance

Community

DMA

Client health

and safety

Product and

service labeling

Marketing

communica-tions

Client Privacy

Compliance

DMA

Materials

Energy

Water

Biodiversity

36

36~37

30

30

30

36

-

-

-

-

-

31

-

-

16~19

-

31~32

30

-

32

-

38

38

-

38

38

38

38

38

38

-

-

-

-

-

-

-

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

For the Community

For the Community

Ethical Management

Ethical Management

Ethical Management

For the Community

None

None

None

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Customer Satisfaction

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Business Overview

None

Customer Satisfaction

Ethical Management

None

Customer Satisfaction

None

For the Community

For the Community

Not applicable due to the nature of the business

For the Community

For the Community

For the Community

For the Community

For the Community

For the Community

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Not applicable due to the nature of the business

SO1

SO2

SO3

SO4

SO5

SO6

SO7

SO8

SO9

SO10

PR1

PR2

PR3

PR4

PR5

PR6

PR7

PR8

PR9

EN1

EN2

EN3

EN4

EN5

EN6

EN7

EN8

EN9

EN10

EN11

EN12

EN13

EN14

EN15

Emissions,

Effluents,

and Waste

Products and

Services

Compliance

Transport

Overall

DMA

Product and

Service Impact

Society

Product

Responsibility

EN16

EN17

EN18

EN19

EN20

EN21

EN22

EN23

EN24

EN25

EN26

EN27

EN28

EN29

EN30

FS1

FS2

FS3

FS4

FS5

FS6

FS7

FS8

FS9

FS10

FS11

FS12

FS13

FS14

FS15

FS16

Total direct and indirect greenhouse gas emissions by weight

Other relevant indirect greenhouse gas emissions by weight

Initiatives to reduce greenhouse gas emissions and reductions achieved

Emissions of ozone-depleting substances by weight

NOx, SOx, and other significant air emissions by type and weight

Total water discharge by quality and destination

Total weight of waste by type and disposal method

Total number and volume of significant spills

Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally

Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by the reporting organization's discharges of water and runoff

Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation

Percentage of products sold and their packaging materials that are reclaimed by category

Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with environmental laws and regulations

Significant environmental impacts of transporting products and other goods and materials used for the organization's operations, and transporting members of the workforce

Total environmental protection expenditures and investments by type

Management approach to create product and service performances

Policies with specific environmental and social components applied to business lines

Procedures for assessing and screening environmental and social risks in business lines

Processes for monitoring clients' implementation of and compliance with environmental and social requirements included in agreements or transactions

Process (es) for improving staff competency to implement the environmental and social policies and procedures as applied to business lines

Interactions with clients/investees/business partners regarding environmental and social risks and opportunities

Percentage of the portfolio for business lines by specific region, size, (e.g. micro/SME/large) and sector.

Monetary value of products and services designed to deliver a specific social benefit for each business line broken down by purpose

Monetary value of products and services designed to deliver a specific environmental benefit for each business line broken down by purpose

Coverage and frequency of audits to assess implementation of environmental and social policies and risk assessment procedures

Percentage and number of companies held in the institution's portfolio with which the reporting organization has interacted on environmental or social issues

Percentage of assets subject to positive and negative environmental or social screening

Voting polic (ies) applied to environmental or social issues for shares over which the reporting organization holds the right to vote shares or advice on voting

Access points in low-populated or economically disadvantaged areas by type

Initiatives to improve access to financial services for the disadvantaged

Policies for the fair design and sale of financial products and services

Initiatives to enhance financial literacy by type of beneficiary

38

38

38

-

-

-

38

-

-

-

38

-

-

38

-

16~19

9,16~19

45~47

27~29, 30, 45~47

30~33

16~19

16~17

38, 41~44

38, 41~44

25~29, 45~47

38

27~30

25~26, 36~38

36~38

36~38

30

36~38

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

For the Community

For the Community

For the Community

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Not applicable due to the nature of the business

For the Community

Not applicable due to the nature of the business

Not applicable due to the nature of the business

Not applicable due to the nature of the business

For the Community

Not applicable due to the nature of the business

None

For the Community

Non-reported

Business Overview

Letter from the CEO, Business Overview

Risk and Capital Adequacy

Risk Management, Ethical Management,Risk and Capital Adequacy

Ethical Management, Customer Satisfaction, For the Employees

Business Overview

Business Overview

For the Community, Business Performance

For the Community, Business Performance

Corporate Governance, Risk Management, Risk and Capital Adequacy

For the Community

Risk Management, Ethical Management

Corporate GovernanceFor the Community

For the Community

For the Community

Ethical Management

For the Community

Samsung Securities Report 2013 Appendix 64.65

Society Performance Indicators

Product Responsibility Performance Indicators

Environmental Performance Indicators

Additional Indicators for Financial Services Sector

GRI INDEX

Classification Index Details Page Disclosure Level

Report of Samsung Securities Classification Index Details Page Disclosure Level

Report of Samsung Securities

HeadquartersSamsung Securities Co., Ltd.Samsung Main Building67 Sejong-daero, Jung-guSeoul 100-742, South Korea Tel: +82-2-2020-8000http://www.samsungsecurities.com

Global NetworkLondonSamsung Securities Europe Ltd. 21th Floor, Tower 42, 25 Old Broad Street, London EC 2N 1HQ, UK Tel: +44-20-7786-7829Fax: +44-20-7786-7818

New YorkSamsung Securities America Inc.26th Floor, 1330 Avenue of the AmericasNew York, NY10019, USATel: +1-212-972-2454Fax: +1-212-972-2074

Hong KongSamsung Securities Asia Ltd.Suite 4511, Two International Finance Centre,No. 8 Finance StreetCentral, Hong Kong Tel: +852-3411-3608Fax: +852-2528-6169

TokyoSamsung Securities Tokyo Branch16th Floor, Roppongi T-Cube 3-1-1, Minato-kuTokyo, Japan Tel: +81-3-6234-2793Fax: +81-3-6234-2800

BeijingSamsung Securities Beijing Representative Office Room 910, The Exchange Beijing B/D118 Jianguo Road, Chaoyang DistrictBeijing, China Tel: +86-10-5693-1690Fax: +86-10-5693-1694

Corporate Information

This report contains information regarding Samsung Securities’ most recent business performances, as well as forward-looking statements including anticipated changes in economic

conditions, prospects for the securities industry, and the company’s performance objectives and strategies. Actual results may differ from these expectations and analyses, due to a

number of unpredictable factors. Samsung Securities bears no responsibility for updating or revising any of these forward-looking statements, or for editing or adding any information in its

management and analysis discussions. Please pay close attention when reading any analyses contained in this report.

Forward-looking Statement

Number of Domestic Branches (as of the end of December 2013)98

Number of Employees (as of the end of December 2013)2,773 (including overseas employees and outside directors)

Major Shareholders (as of the end of December 2013)Samsung Life Insurance: 11.14%Samsung Fire & Marine Insurance: 8.02%

General Shareholders’ MeetingMarch 14, 2014

Stock Exchange ListingKorea Exchange, 016360

Transfer AgentKorean Securities Depository 23 Yeouinaru-ro 4-gil, Yeongdeungpo-guSeoul 150-948, South Korea Tel: +82-2-3774-3000

Enquiries about IRTel: +82-2-2020-7914 Fax: +82-2-2020-8097E-mail: investor@samsung.com

Enquiries about SustainabilityTel: +82-2-2020-7528 Fax: +82-2-2020-8097E-mail: sustain_fn@samsung.com

Organization (As of the beginning of May 2014)

BOD

CEO

Retail Division

- Gangnam 1 BU

- Gangnam 2 BU

- Gangbuk BU

- Busan/Gyeongnam BU

- Gangseo BU

- Daegu/Gyeongbuk BU

- Gyeonggi BU

- Bundang BU

- Honam BU

- Chungcheong BU

- SNI BU

- Online BU

- Pension Plan BU

Wholesale Division

- Institutional BU

- Korean Equity Sales BU

- FICC BU

IB Division

- Corporate Finance 1 BU

- Corporate Finance 2 BU

Strategic Business

Division

- Product Strategy Unit

- Customer Support Unit

Management Support

Division

- Planning & Control Unit

- Corporate Finance Unit

- Information System Unit

- Human Resources &

Communications Unit

Customer Asset

Management Unit

Risk Management Unit

Research Center

Trading BU

Prime Brokerage Service BU

Customer Protection Center

Board OfficeAudit Committee Member

Audit Division

SAMSUNG SECURITIES BRAND

In 2014, Interbrand, a US-based branding consultancy, examined a competitive pool of Korean brands and ranked the top fifty by brand value in a report called “Best Korea Brands 2014.” Samsung Securities ranked thirty-third among all brands and first in the securities sector, with a brand value of USD 458 million.

This is the brand slogan of Samsung Securities. It reflects our goal of working with our clients to add to their values and help establish a new financial culture.

Samsung Securities’ Integrated Wealth Management Brand

Brand for VIP client membership

UHNW Clients Wealth Management Brand

JUNE 2013

Samsung Securities Report 2012

Samsung Securities publishes reports containing details of its financial performance and sustainable management activities every year.

JUNE 2012

Sustainability Report 2011 Annual Report FY 2011

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