Korea Exchange and Global Business Introduction Global Business Department

KRX Overview 2 Major Milestones of KRX 1956Korea Stock Exchange (KSE) launched 1996KOSDAQ launched 1996KOSPI 200 index futures market opened 1997KOSPI 200 index options market opened 1999Korea Futures Exchange (KOFEX) launched 2002ETF market opened 2005Consolidation of KSE, KOSDAQ, KOFEX 2005ELW market opened 2009FTSE Developed Mkt. Index included 2009Trading link with CME for KOSPI 200 futures 2010Trading link with EUREX for KOSPI 200 option 2014CCP Services for OTC derivatives products 2015Launched KRX mini-KOSPI futures and options 1950s 1990s 2000s 2010s

KRX Overview 3 Consolidation of Exchanges (1996) (1999) (1956) Koscom Corporation (2005) ** Established under the Korea Stock & Futures Exchange Act. Technology Subsidiary [ 76% owned ] Depository Subsidiary [ 70% owned ] Remarkable Market Growth   Abundant experience (successful & unsuccessful) on policies that promote the growth of the Capital Market Remarkable Market Growth   Abundant experience (successful & unsuccessful) on policies that promote the growth of the Capital Market Well-diversified Industries Portfolio World-wide known brands and companies from different industries are listed in KRX Well-diversified Industries Portfolio World-wide known brands and companies from different industries are listed in KRX High Participation of Foreign Investors  - Foreign Investors Holdings: +30% - 19 out of 62 Members are global financial companies High Participation of Foreign Investors  - Foreign Investors Holdings: +30% - 19 out of 62 Members are global financial companies State-of-the-Art Technology Solutions  Continuous development of In-house solutions which are at par with international standards on High-Volume & Low-Latency. Korea Securities Depository

Regulatory Framework 4 FSC FSS KSD KOSCOM Regulatory Authority Regulatory Enforcement Agency Depository & SettlementIT System Solutions MOSFMinistry of Strategy and Finance FSCFinancial Services Commission FSSFinancial Supervisory Service KOFIAKorea Financial Investment Association KSFCKorea Securities Finance Corporation KSDKorea Securities Depository KOSCOMKorea Securities Computer Corporation MOSF Planning and Formulating Economic Policies

Organizational Structure 5 Main market Stock, Bond, ELW, ETF Established and blue-chip KOSPI Market Futures and Options market Financial & Commodities Derivatives Market SMEs market IT, S/W, Bio, Entertainment KOSDAQ Market Market Oversight Commission Market Oversight Commission KONEX Market Start-up Venture market Commodities Market Petroleum(‘12)/Gold(‘14) etc. CategoryNumber Standing directors 7 Non-standing directors 8 Executive directors 12 Employees761 Management Strategy

KRX Markets Overview 6 KRX is one of the top-tier players among global exchanges by market size, trading value and liquidity. Key Statistics # 1CME group3,442 # 2ICE group2,276 # 3Eurex group2,098 # 4NSE (India)1,880 # 5BM&F1,418 # 12 KRX678 # 13 Zhengzhou Exchange 676 # 1BSE India5,836 # 2TMX (Canada)3,559 # 3BME Spain3,651 # 4JPX (Japan)3,513 # 6NYSE2,424 # 8 KRX1,961 # 11Shenzhen SE1,746 Derivatives Trading volume No. of Listed Companies # 1NYSE22,734 # 2Nasdaq(US)8,650 # 3JPX (Japan)5,764 # 9Deutsche Börse2,114 # 13 KRX1,541 # 15Australia1,468 # 16BME Spain1,104 Market Capitalization (USD bil.) Trading Value Source : World Federation of Exchanges (end-2015) (Year-to-Date ; USD bil.) # 1Shanghai SE21,342 # 2Shenzhen SE19,611 # 3NYSE17,477 # 8Hong Kong Exchange2,125 # 10 KRX1,929 # 11Deutsche Börse1,555 # 12TMX (Canada)1,184 Source : World Federation of Exchanges (2015)Source : World Federation of Exchanges (end-2015) Source Futures Industry Association (2014)

KOSPI Market USD 4.46 billion KOSDAQ Market USD 2.94 billion Bond Market USD 6 billion Derivatives Market - USD 44 billion Average Daily Trading Value (2015) USD 57.4 Billion Average Daily Trading Value (2015) USD 57.4 Billion  Market Capitalization : USD 1,5 trillion ▪ Trading Value (2015) (end-015) * FX rate: KRW1,200=USD1 Daily Market Trading Information 7

Weight of Foreign Investors by NationalityInvestor Groups by Market Cap. KRX Market Overview 8  Active retail investors plus stable local & foreign institutional investors  Ever-increasing size of pension funds has been playing a role of anchor investor.  Inflow of foreign investors has accounted for over 30% of investment in KRX market. Balanced and solid investor base Source : KRX Calculation (End of Dec. 2013) Europe 16.48%  Over 69.3% of foreign investment comes from US and Europe.  Among European countries, UK, Netherlands and France are major investors in Korean equities. Singapore : 5.5% Japan : 1.5% China : 1.8%  Singapore takes up best portion of market capital among the Asian countries

Industries in KOSDAQ by Market Cap  KOSPI Market for large blue-chips in electronics, machinery, automotive, finance and petrochemicals  KOSDAQ Market for SMEs and start-ups in Bio, IT, semiconductor, Internet and software KRX Market Overview 9 Industries in KOSPI by Market Cap % Diverse industrial sectors Source : KRX Calculation (End of Dec. 2014)

KRX Market Growth Growth of KRX (No. of listed companies) * (USD billion) Stage Ⅰ Stage Ⅱ Stage Ⅲ Stage Ⅳ Going public policy drive Market opening Capital market reform Securities exchange act enacted * Excludes KOSDAQ No. of listed companies Market capitalization GDP

KRX Overview 11 Growth of KRX  Early recognition of importance of direct financing/capital market development policy  Mobilizing domestic savings through retail investments  Incentives and disincentives to encourage going public Stage Ⅰ ~ Ⅱ : Capital market development strategy  Blue print for financial liberalization (price, industry, opening)  Leveraging market opening for deepening market and securities industry  Reforms under IMF/World Bank prescriptions(corporate/financial/public/labor)  Redesigning capital market supervision system (establishing FSC, FSS)  Legal changes to align capital market regulations with international standards (corporate governance etc.) 1960’s ~ 1970’s Stage Ⅲ : Capital market and industry opening Stage Ⅳ : Structural reform after the Asian crisis 1980’s ~ 1990’s 1997

12 Increase of Public Wealth Income redistribution from corporations to the public through distribution of shares Corporate Competitiveness Improvement separation of ownership and management Improvement of productivity Corporate Governance Improvement Market-recognized ownership structure. Contribution of Securities Market to Economy Year Household Expenditure (Rate of increase) 75,850 (25.3%) 87,410 (15.2%) 116,820 (33.6%) 154,822 (32.5%) 187,726 (21.3%) 225,496 (20.1%) 263,085 (16.7%) Facility Investment (Rate of increase) 1,661 (38.9%) 2,434 (46.5%) 3,908 (60.6%) 5,229 (33.8%) 5,419 (3.6%) 6,190 (14.2%) 6,755 (9.1%) Effects of the government–driven securities market development Contribution of IPO promotion on Korean national economy

KRX 33 Yoido-dong, Youngdeungpo-ku Seoul, , Korea Tel Fax