kmb Korea Money Brokerage Corp.

Introduction

After the launch of foreign exchange broking services in 1999, KMB has consistently worked to benefit the clients with more diverse, more convenient and safer products.

Our efficient and advanced electronic trade system (KMB-Net) ensures great speed and precision in the trade execution and allows clients to choose between voice and electronic broking according to their preference. We have diversified the FX broking services to include spot, swap, NDF as well as G7 currency pairs in response to the changing market demands. Moreover, our timely information service, such as real-time FX rates, help the clients (Reuters, Yonhap Infomax, KOSCOM, etc.) stay one step ahead in the market.

In September 2009, we were designated as a certified publisher of fixing exchange rates by the Ministry of Strategy and Finance and have since provided daily basic exchange rates for the won/dollar, contributing to a higher level of transparency and accuracy of published rates.

Since Decemberst 1st 2014, Korea’s domestic Won/Yuan direct exchange market has opened up and ‘Korea Money Brokerage Co.’ has become one of the Korea’s best Won/Yuan Inter-Dealers with the help of our multiple financial institutions. We would be pleased to continuously do business with you and we greatly appreciate the support and contributions you brought to our company. We will look forward to a successful business relationship with your company in the near future.

Products

• FX Spot
• MAR
• FX Swap
• NDF
• Deposit

FX SpotKRW/USD

Foreign exchange spot (FX spot) market is an interbank market where an exchange rate of a transaction between institutional traders is decided. Exchange rates of spot transactions set the basis for the rates applied to retail traders. Financial institutions participate in the FX spot market in order to, in the case of foreign exchange banks, close out positions from their transactions with retail customers, or purely take profits. In the FX spot trading, delivery of currencies and settlement are completed within 2 business days from the date when the contract is entered into (trade date). Currently KMB, along with SMB, provides brokerage services for the FX spot trade in Korea.

Transaction Flow

FX SpotKRW/CNH

Foreign exchange spot (FX spot) market is an interbank market where an exchange rate of a transaction between institutional traders is decided. Exchange rates of spot transactions set the basis for the rates applied to retail traders. Financial institutions participate in the FX spot market in order to, in the case of foreign exchange banks, close out positions from their transactions with retail customers, or purely take profits. In the FX spot trading, delivery of currencies and settlement are completed within 2 business days from the date when the contract is entered into (trade date). Currently KMB, along with SMB, provides brokerage services for the FX spot trade in Korea.

Transaction Flow

MAR

MAR, short for "Market Weighted Moving Average Rate" or "Market Average Rate", is a transaction where the won-dollar exchange is done at a fixing rate, which is announced in the morning of a fixing date, a business day prior to the settlement of a spot transaction (value date). Fixing rate (market average rate) is a weighted-average of exchange rates applied in the spot transactions conducted on the valuation date, a business day before the fixing date. * A weighted-average-rate is determined by calculating the average of exchange rates multiplied by the trading volume for each level.

Transaction Flow

FX Swap

Foreign exchange swap (FX swap) is a simultaneous sale and purchase of one currency for another with two different value dates (i.e. spot and forward transactions). As these spot and forward transactions occur in an offsetting way, the trader is left with no open position and hence no vulnerability to currency risk. Moreover, the trader can take advantage of cash flow from the other currency he/she holds during the life of a contract. Objectives of FX swap include 1) raising short-term funds with the borrowing of cash, 2) extending or shortening maturities of the existing FX trades, 3) hedging against currency risk and 4) taking speculative profits.

Transaction Flow

NDF

Non-Deliverable Forward (NDF) is a forward contract where the counterparties settle the difference of a contracted forward rate and a prevailing spot rate - a market average rate - of a business day prior to the maturity date in a benchmark currency (usually US dollar) without any exchange of principal payment at the end of the contract. As NDF is actively traded in other markets such as London, New York, Hong Kong and Singapore after the Korean market closes, New York's closing prices tend to have high effect on the dollar-won opening rates the next day.

Transaction Flow

Deposit

Deposit (DEPO) is a foreign currency-denominated deposit, which is lent (borrowed) for a certain period of time and received (repaid) with the interest payment. As the most actively traded foreign currency is the U.S. dollar, the transaction is also termed "dollar call." The trade is carried out primarily between local commercial banks and branches of foreign banks in Korea, but participation from banks in overseas countries like Hong Kong, Singapore and China also takes up a significant share. Settlement of funds is done through accounts of overseas settlement banks.

Transaction Flow

Cross Currency

Cross currency market is where international currencies other than the USD-KRW pair, including JPY, EUR and CHF, are traded.

CME Spot

CME Spot is an anonymous dealing platform for FX spot dealers of banks, which offers a high level of liquidity and depth for all major currencies and 24-hour access to the global market.

CME Prime

CME Prime enables local banks and non-bank clients, such as hedge funds, fund managers and Commodity Trading Advisors (CTAs), to trade at the best rates of a market. By using the credit line of an CME Prime bank, customers can get access to abundant liquidity and best market rates on CME Spot.