PA - Banco Security

2.2 Factoring Industry
Factoring has become an important source of alternative and complementary funding for medium and small businesses. The factoring
industry has performed well in recent years, the amounts advanced by the members of ACHEF (the factoring business association) at
September 2010 totaled Ch$ 1,595 billion.
At September 2010, Factoring Security had total advances of Ch$ 119 billion, equivalent to a market share of 7.5%.
2.3 Mutual Funds Industry
The mutual funds industry as of December 2010 shows average assets and average number of investors of Ch$ 18,206 billion and
1,525,966 respectively. Among the most notable highlights in recent times have been the consolidation of mutual funds’ participation
in the Voluntary Pensions Saving (APV) system and the creation of the figure of qualified investors which will permit the creation of
funds specially designed for this type of customer.
At December 2010, Administradora General de Fondos Security had average assets of Ch$ 698 billion, with a market share of 3.84%,
occupying 9th place out of the 19 managers operating in the market.
2.4 Stockbroking Industry
During 2010, market activity grew by 46.8% compared to 2009. The shares traded by Valores Security rose by 113%. Its market share
has moved from 3.0% in 2006 to 3.3% in 2007, 3.7% in 2008 and 4.7% in 2009. The share volume traded in 2010 reached Ch$ 4,352
billion, with a market share of 6.9%, considering transactions on the Santiago Stock Exchange and the Chilean Electronic Exchange.
2.5 Insurance Industry
The insurance industry in Chile is made up of two main branches, life and general, which are differentiated by the regulations covering
the players and the types of product they sell. At September 2010, there were 31 life insurance companies and 20 general insurance
companies (excluding credit companies).
The direct premium income of life and general insurance companies was Ch$ 2,073 billion and Ch$ 1,010 billion respectively at
September 2010. The industry’s earnings were Ch$ 374,630 million and Ch$ 2,679 million for life and general insurance companies
respectively, at September 2010.
3. Individual results of the principal subsidiaries of Grupo Security:
Banco Security produced consolidated earnings attributable to controller shareholders for 2010 of Ch$ 33,706 million, achieving a
16.3% return on equity. Total loans as of December 31, 2010 were Ch$ 1,989 billion, less than the Ch$ 2,189 billion reported as of
December 2009, mainly the result of a reduction in interbank loans. Risk levels reached 1.91%, measured as loan provisions to total
loans, and 1.49% measured as loans overdue 90 days or more to total loans. The efficiency ratio was 49.15%, measured as operating
costs to the gross operating result, and 1.79% measured as operating costs to total assets. With respect to the Basel ratio, this was
12.66% at December 2010, reflecting a solvent financial position.
Factoring Security, operating since December 1992, is one of the pioneering companies in the Chilean factoring industry and
remains as one of the leading companies in the market. As of December 2009, Factoring Security’s stock of advances amounted to
Ch$ 134,285 million (Ch$ 108,614 million in 2009). Risk levels remained controlled at a level of 4.4%, measured as loan provisions
to total loans. Its earnings for 2010 were Ch$ 2,122 million.
Valores Security S.A. Corredores de Bolsa offers its clients the services of securities trading, stock broking and portfolio management.
The company produced earnings of Ch$ 1,501 million in 2010 as a result of a 113% increase in the share volumes traded over the
previous year, taking into account trading on the Santiago Stock Exchange and Chilean Electronic Exchange.