Securities Review 2013 05-12-2014

INNOVATION,

HISTORY AND

LEADERSHIP

/ ANNUAL REPORT /SANTIAGO STOCKExChANGE2013

RESEA (31,5x21,5) INGLES.indd 1 15-04-14 12:17

/ TABLE OF CONTENTS /

page 7 VISION, MISSIONAND VALUES

page 8LETTER FROMTHE CHAIRMAN

page 11CORPORATEGOVERNANCE

> Our Board of Directors

> Chief Executive Offi cer

> Our Committees


page 69MARKETSNAPSHOT

page 19OUR STOCK EXCHANGE

> Our Stock Exchange:

Achievements 2013

> Our Challenges

> Brokerage Houses

> 120 years investing in the future

page 57OUR PRODUCTS AND SERVICES

> Comprehensive Service

for Our Customers

> From Routing to Back Offi ce

> Products and Services

page 35OUR ECONOMY AND STOCK MARKET IN 2013

> The Economy In Figures

> 2013 Stock Market Summary


LEADERSHIP

INNOVATION

HISTORY


OUR VISION /To be leaders in financial services, offering issuers, intermediaries and investors a market infrastruc-

ture with a high level of efficiency, technology and quality, and giving access to a wide array of in-

vestment products.

We intend to achieve this through the culture and attitude of our company and its people, both of

which are committed to the customer, innovation, competition, efficiency, service quality, technolo-

gy and management capacity.

OUR MISSION / To positively contribute to the development of capital markets and the wealth of our country, help-

ing issuers access diverse funding sources, generating value for investors, and enabling intermediar-

ies and clients to trade financial instruments in a trusted and transparent environment.

OUR VALUES / Excellence, quality and customer service are the core of our work and our key hallmark. We always

perform our tasks in the best possible way, with total dedication and spirit of service.

Honesty in complying with the law, regulations and instructions, as well as confidentiality and high

ethical standards, are essential in our daily work.

Talent and innovation are the foundation of our ability to develop original ideas and solutions, allow-

ing us to reach our goals, rise to the challenges and exceed customer expectations.


At the end of the year in which we celebrate 120 years of history, I am especially proud to present our

Annual Report for 2013, which reflects the development of Santiago Stock Exchange as the countrys

main stock market and one of the most important in Latin America, contributing to the growth of the

Chilean capital markets and the strengthening of our economy.

With a forward-looking vision, Santiago Stock Exchange has sought to invigorate the Chilean capital

markets, continuously innovating and incorporating new products and services to supply a broad

offering of instruments to local and foreign investors.

Today, Santiago Stock Exchange offers a comprehensive service to its customers and gives

companies the opportunity to diversify their financing sources in a trusted, transparent and

sound environment.

To this end, in recent years we have made progress on implementing internal changes, important

initiatives and significant projects aimed at strengthening the stock market in Chile and its regional

positioning. Special importance has been placed on integration in order to move forward with the

consolidation of an open, attractive market for global investors that incorporates strategic alliances

with different exchanges throughout the region.

As part of these achievements, this year we celebrate the second anniversary of the start-up of the

Integrated Latin American Market (MILA). In addition to being an important channel for performing

transactions from one country to another, MILA has positioned itself as platform for integration,

strengthening financial business in Chile, Peru and Colombia.

MILA currently brings together almost 600 issuers, making it the second largest market in terms of

market capitalization in Latin America and the third largest in variable income trades and transac-

tions. As a result of MILA, mergers and acquisitions involving important financial holding compa-

nies have come about, initiating a process of international expansion and regional integration that

shows the catalyzing role that integration plays in the development of companies and countries and

whose future outlooks are large in scope.

Also within the framework of international alliances, we have continued to take important steps

with the Toronto Stock Exchange to leverage its experience, particularly of the TSX Venture Ex-

change division, to enable Chile to create a venture capital market, specializing in mining exploration

projects, the most important production sector in our country and that could benefit from increased

financing and new investments. We expect to make considerable progress on this initiative in 2014.

Our interest in generating spaces for integration peaked at the event that brought together repre-

sentatives from the Ibero-American stock market industry at the International Conference FIAB 2013,

which was organized by Santiago Stock Exchange. In September of this year, a total of 17 countries

and 23 stock exchanges from South America, Central America and Europe met in Santiago, along

with renowned international speakers and participants from the Chilean capital markets.

Our concern for the continual development of the Chilean capital market and the strengthening of

our economy also inspired us to incorporate new financial instruments, such as exchange traded

funds (ETFs) and the Derivatives Market, the latter of which we expect to begin to operate in 2014

after regulations are approved by regulatory authorities.

Its start-up will be a major step for the local market, allowing for advances in the diversification pro-

cess, risk management, and in the liquidity and depth of the domestic capital market. It will repre-

sent a strong boost for the development of the local financial market, bringing the Chilean stock

market to not only local investors but also a large number of foreign investors.

/ LETTER / FROM THE CHAIRMAN


The launching of an ETF for the IPSA, led by Ita Administradora General de Fondos and Santiago

Stock Exchange, presents important outlooks, as they are the fastest growing financial instruments

on international markets and are part of the most traded securities on most global markets. A sam-

ple of this was the success attained by the IPSA ETF when in its first month of trading the instrument

exceeded US$ 25 million.

Our interest is also in building a capital market that projects itself sustainably. To achieve this, we

have decided to move forward with the creation of a Sustainability Index, for which it organized a

bidding process that brought together local and international experts to design a model that incor-

porates global experience adapted to the reality of our market. In this way, we hope to add options

for developing and promoting responsible investment.

In terms of connectivity, technology and infrastructure, today Santiago Stock Exchange has a world-

class technological platform called Telepregn HT, which is a pioneer in the world and whose archi-

tecture has been adopted by important international stock markets. In addition, in terms of integra-

tion with other platforms, we have incorporated the FIX protocol (version 4.4), which has enabled

our trading system to directly connect to the main international suppliers of order routing systems,

giving our customers access to Telepregn HT through Direct Market Access (DMA).

In this way, we have a highly stable and reliable platform to properly support our daily transactions,

with traded volumes of around US$ 2.0 billion each day. Through each of these initiatives, Santiago

Stock Exchange and its issuers have generated a virtuous circle of growth.

We are aware that the market delivers multiple and constant challenges. The Board of Directors and

I have worked to address these challenges with our sights set high, incorporating all viewpoints and

laboring to build a sound market based on trust and transparency. Our efforts are guided by princi-

ples of the utmost integrity and honesty in complying with laws, regulations and instructions as well

as high ethical standards.

Having fulfilled this important commitment, upon resigning as Chairman after 25 years of service,

I can say without a doubt that the experience has been enriching. I am proud to have been able to

contribute to the development of Santiago Stock Exchange. I would also like to express my sincerest

gratitude for the support and confidence placed in me throughout the years.

Santiago Stock Exchange will continue to work hard to meet its goals, to create value for sharehold-

ers, brokers, issuers and investors, and to compete successfully in global markets, in order to exer-

cise a vital role in terms of economic development, innovation, regional presence, employment and

corporate social responsibility, that ultimately translates into greater growth for our country and

prosperity for all Chileans.

PABLO YRARRZAVAL VALDSCHAIRMAN, SANTIAGO STOCK EXCHANGE


1 120 YEARS INVESTING IN THE FUTURECORPORATE GOVERNANCE


1. PABLO YRARRZAVAL VALDS

2. LEONIDAS VIAL ECHEVERRA

3. JUAN EDUARDO CORREA GARCA

4. JAIME LARRAN VIAL

5. SCAR VON CHRISMAR CARVAJAL

6. JUAN ANDRS CAMUS CAMUS

7. RODRIGO MANUBENS MOLTEDO

8. HERNN SOMERVILLE SENN

9. NICHOLAS DAVIS LECAROS

10. JUAN ANDRS FONTAINE TALAVERA

11. EDUARDO MUOZ VIVALDI

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OUR/ BOARD OF DIRECTORS /


EDUARDO MUOZ VIVALDI

Director

Degree in industrial engineering from Univer-

sidad de Chile. Founding partner and Chairman

of Negocios y Valores S.A., Corredores de Bol-

sa. Director of Santiago Stock Exchange since

April 29, 2010.

JUAN ANDRS FONTAINE TALAVERA

Director

Degree in business administration from Universi-

dad Catlica and Master of Economics from the

University of Chicago. Former Minister of Econ-

omy, Head Partner of Fontaine Consultores S.A.

Member of the Executive Council at Instituto Lib-

ertad y Desarrollo, Director of Embotelladora An-

dina. Director of Santiago Stock Exchange since

April 24, 2012.

SCAR VON CHRISMAR CARVAJAL

Director

Degree in industrial engineering from Univer-

sidad de Santiago. Vice Chairman of Banco

Santander. Member of the boards of Directors

of Banco Santander in Argentina and Peru, Sina-

cofi and Chairman of Santander Consumer Chile.

Director of Santiago Stock Exchange since April

24, 2012.

JUAN EDUARDO CORREA GARCA

Director

Degree in industrial engineering from Universidad

Catlica de Chile. Vice Chairman of Banco Bice.

Chairman of Bice Vida Compaa de Seguros S.A.,

Chairman of Bice Hipotecaria S.A. and Director of

Santiago Stock Exchange since April 24, 2012.

NICHOLAS DAVIS LECAROS

Director

Chairman of EuroAmerica S.A., EuroAmerica Se-

guros de Vida S.A., EuroAmerica Administradora

General de Fondos S.A. and EuroAmerica Servi-

cios Financieros S.A. Director of Santiago Stock

Exchange since April 24, 2012.

JAIME LARRAN VIAL

Director

Broker of Santiago Stock Exchange since

November 11, 1974. Partner at brokerage house

Jaime Larran y Ca., Corredores de Bolsa Ltda.


27, 2000.

PABLO YRARRZAVAL VALDS

Chairman

Partner at brokerage house Yrarrzaval y Ca.,

Corredores de Bolsa Ltda. Chairman of Ener-

sis S.A. Member of the board of Directors of

Santiago Stock Exchange since April 10, 1986.

Chairman of Santiago Stock Exchange since

January 17, 1989.

LEONIDAS VIAL ECHEVERRA

Vice Chairman

Partner at brokerage house Larran Vial S.A.,

member of the boards of Directors of Enersis S.A.,

Coca-Cola Embonor S.A., Watts S.A., Compaas CIC

S.A. and Ca. Industrial El Volcn S.A. Vice Chairman

of Santiago Stock Exchange since June 14, 1988.

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HERNN SOMERVILLE SENN

Director

Degree in law from Universidad de Chile. Mem-

ber of the boards of Directors of Enersis and

Inacap S.A., Director and partner of Fintec Ltda.


24, 2012.

RODRIGO MANUBENS MOLTEDO

Director

Degree in business administration from Univer-

sidad Adolfo Ibez and Master of Science from

London School of Economics. Member of the

board of directors of Banco de Chile. Chairman of

Banchile Seguros de Vida. Director and Chairman

of Directors Committee of Aguas Andinas. Direc-

tor of Santiago Stock Exchange since May 27, 2013.

JUAN ANDRS CAMUS CAMUS

Director

Degree in business administration from Univer-

sidad Catlica de Chile Founding partner of Cel-

fin Capital. Member of the boards of Directors

of BTG Pactual Chile, AES Gener S.A. and Besalco

S.A. Director of Santiago Stock Exchange since

April 29, 2010.

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PATRICIO ROJAS SHAROVSKY

Chief Financial Offi cer

CARLOS NIEDBALSKI CHACN

Chief Audit and Control Offi cer

ANDRS ARAYA FALCONE

Chief Information Offi cer

JOS ANTONIO MARTNEZ ZUGARRAMURDI

Chief Executive Offi cer

/ MANAGEMENT /

We have consolidated and strengthened our leadership, keep-

ing in mind the challenges of participating in a dynamic, high-

ly competitive, globally-focused market. This market drives us

to constantly innovate, developing products and providing

high-quality services to our customers and to the entire domes-

tic securities market.

Throughout its 120 years of existence, the Santiago

Stock Exchange has established itself as Chiles most

important stock market and one of the most relevant

in the region. It has made considerable contributions

to the development of both capital markets and the

local economy, placing it in a excellent position it to

lead initiatives to foster future growth.

Santiago Stock Exchange has prioritized the de-

velopment of a sound stock market, integrated

with other international exchanges taking into

account the challenges involved in participating

in a dynamic, competitive and global market.

We have acquired the knowledge and handling

of innovative technologies, in partners with

world-wide leader suppliers, in order to fulfill

the business and normative requirements. Being

aligned with our customers has unabled us to

occupy a leading position, facilitating through

technology, the focus of our global market.

01 CORPORATE GOVERNANCE


JUAN CARLOS PONCE HIDALGO

Chief Operating Offi cer

NICOLS ALMAZN BARROS

Chief Planning and Development Offi cer

RODRIGO SERRANO BOMBAL

Secretary General

Santiago Stock Exchange is a market with

multiple products and systems that connects

thousands of local and foreign investors, with

average trades of over US$ 2 billion in shares,

fixed-income instruments, money market in-

struments, investment fund quotas and for-

eign securities.

We have created important milestones and

made major contributions to the development of

the Chilean economy and capital market. With a

constant forward-looking vision, we have incor-

porated international trends and broadened the

offering of investing and financing alternatives

available to local and foreign issuers, brokers

and investors.

Santiago Stock Exchange has decisively con-

tributed to the development and progress of

Chile for over a century, through its profes-

sional and specialized contribution, to an area

of such importance for all, as is the growth of

the capital market.


OUR / COMMITTEES /

BUSINESS AND TECHNOLOGY COMMITTEE /

This committee is responsible for evaluating and proposing measures

regarding the functioning and development of trades and the use of

technology by Santiago Stock Exchange.

MEMBERS:

STANDING MEMBERS

> Juan Andrs Camus Camus

> Nicholas Davis Lecaros

> Juan Andrs Fontaine

> Hernn Somerville Senn

> Leonidas Vial Echeverra

ALTERNATES

> Maximiliano Vial

> Henry Comber Sigall

> Manuel Bulnes Muzard

REGULATIONS, RISK AND AUDIT COMMITTEE /

This committees function is to analyze and propose improvements

to the stock exchange s regulations as well as evaluate and monitor

established risk policies. On the other hand, it ensures the financial po-

sition and budgets for Santiago Stock Exchange as well as supervising

market monitoring and external and internal audits.

MEMBERS:

STANDING MEMBERS

> Eduardo Muoz Vivaldi

> Juan Eduardo Correa Garca

> Jaime Larran Vial

> Rodrigo Manubens Moltedo

> scar von Chrismar Carvajal

ALTERNATES

> Pedro Robles Echeverra

> Jaime Larran Concha

> Gonzalo Jimnez Parada

> Juan Pedro Santa Mara Prez

BEST PRACTICES COMMITTEE /

This committee is in charge of receiving and resolving complaints

amongst brokers or between brokers and their clients for violations of

the regulations of Santiago Stock Exchange and the laws that govern

the business.

MEMBERS:

STANDING MEMBERS

> Enrique Barros Bourie

> Leonidas Montes Lira

> Lisandro Serrano Spoerer

ALTERNATES

> Jorge Jaramillo Selman

> Jorge Tarzijan Martabit

ETHICS AND DISCIPLINE COMMITTEE /

This committee is responsible for hearing and resolving any controver-

sies that may arise among brokers over market transactions, applying the

Code of Ethics of Santiago Stock Exchange.

MEMBERS:

STANDING MEMBERS

> Patricio Parodi Gil

> Juan Pablo Ugarte Valds

ALTERNATES

> Marcos Comparini Fontecilla

> Jos Luis de la Rosa Muoz

> Gonzalo van Wersch Caldern

01 CORPORATE GOVERNANCE


CHIEF AUDIT ANDCONTROL OFFICER

REGUL AT IONS, RISK AND AUDIT COMMIT TEE

BUSINESS AND TECHNOLOGY COMMIT TEE

BEST PRACT ICES COMMIT TEE

LEGAL COUNSEL

E THICS AND DISCIPL INE COMMIT TEE

CHIEF E XECUT IVE OFF ICER

SECRETARY GENERAL

CHIEF FINANCIAL OFFICER

CHIEF PLANNING AND DEVELOPMENT OFFICER

CHIEF INFORMATION OFFICER

CHIEF OPERATING OFFICER

ORGANIZATIONAL CHART /

BO

ARD

S O

F D

IREC

TOR

S


2 MORE OPPORTUNITIES FOR ISSUERS, INTERMEDIARIES AND INVESTORSOUR STOCK EXCHANGE


6 number of cases submitted to the santiago s stock exchange best practice committee by brokerage house customers in 2013

10 comprehensive custody audits to brokerage houses in 2013

39specific audits

3special audits

1 audit of broker closure

4,870,245

OPERATIONS / BEST PRACTICE COMMITTEE /

AUDITING AND CONTROL /

33 continuous monitoring reports

total trades conducted within the santiago stock exchange considering all markets

/

02 OUR STOCK EXCHANGE


Page

21

In 2013 we celebrated the 120th anniversary of Santiago Stock Exchange. As part of

these festivities, the immense effort to develop Derivatives Market, ETF Market and

Venture Market was applauded. Santiago Stock Exchange will continue to develop

these projects during 2014.

We also celebrated the initial public offering of a new company, Moller & Prez

Cotapo, the incorporation of new foreign stocks, the consolidation of the Integrated

Latin American Market (MILA), and the International Conference of the Ibero-

American Federation of Exchanges (FIAB).

Accreditation of intermediaries was another initiative undertaken in 2013. This project,

as with all the other achievements this year, aims to add value to the market.

/ OUR STOCK EXCHANGE / ACHIEVEMENTS 2013


The SanTiago STock exchange

celebraTeS 120 YearS

On the year of its 120th anniversary, Santiago Stock

Exchange reaffirmed its leadership as the main stock

exchange in Chile and one of the most important in the

region. For more than a century, it has forged significant

achievements and contributions to the development of

the national economy and Chilean capital market. Today

its main challenges are to continue leading the market with

a solid outlook for the future, to ensure strict compliance

with the existing regulatory framework and to generate

new proposals for investors, issuers and intermediaries. As

part of the anniversary celebrations, the stock exchange

acknowledged 17 listed companies for more than 75 years.

Those listed for the entire 120 years include Banco de Chile,

Gasco and Compaa Sudamericana de Vapores.

immediaTe acceSS

To inTernaTional SecuriTieS

Starbucks, McDonalds, Coca-Cola, Walt Disney, 3M and

Nike, amongst others, are some of the 60 foreign com-

panies that were listed on Santiago Stock Exchange

during 2013, with the objective to generate immedi-

ate access to attractive international securities. Local

investors can now access these shares through their

regular brokerage house without the need of a foreign

account. This initiative is framed within Santiago s

Stock Exchange ongoing efforts to develop capital

markets and deliver new and diversified investment

alternatives.

20 13

inTernaTional STock markeT

conference

Santiago Stock Exchange organized and chaired the 40th

International Conference of the Ibero-American Federation

of Exchanges (FIAB) in 2013 with the aim of generating new

and lasting opportunities for interaction, networking, and

acquisition of knowledge across the Ibero-American secu-

rities industry. Seventeen countries and 23 stock exchang-

es from South America, Central America and Europe met

in Santiago, along with renowned international speakers

and participants from the Chilean capital market. Santiago

Stock Exchange has been a member of FIAB since 1973.

inTermediarieS accrediTaTion,

added Value for The markeT

The year 2013 marked the first accreditation process

for intermediaries, with 2,823 people accredited as

of December 31, 2013.

The accreditation process seeks to professionalize the

activity of brokers, and standardize an appropriate lev-

el of performance for both technical and professional

staff performing this service. The accreditation is man-

datory for the majority of people working at a broker-

age house as of January 1, 2014.

/ Achievements 2013 /

02 Our StOck ExchangE

Achieve ments

PagePage

23Page

2323

markeT debuT of The Year

The construction company Moller & Prez Cotapos was

the largest IPO of the year at Santiago Stock Exchange.

The operation grossed approximately USD 92 million,

placing 105 million shares, with more than 3.9 rights is-

sue, all at a price of CLP 400 each. This company makes

for a total of 227 listed companies at the end of 2013.

mila, a laTin

american benchmark

The Integrated Latin American Market (MILA) formed

by the stock exchanges and the depositaries of Lima,

Santiago and Bogota completed its second year of op-

erations as the most important multilateral securities

platform in Latin America. This was celebrated along

foreign investors in New York. During 2013, Standard &

Poors announced the launch of the MILA Sector Indi-

ces, which includes S&P MILA Financials and S&P MILA

Resources.

arriVal of eTf in local markeT

The first IPSA ETF began operating in September 2013

in Santiago Stock Exchange. The fund aims to replicate

the performance of this blue-chip index. For Santiago

Stock Exchange, this launch is an important step in the

development of a new market for locally issued ETFs

and a major achievement in its commitment to expand

the supply of securities, offering new and exciting

business opportunities to local and foreign investors.

During the first month of operations, this instrument

traded USD 25 million.

new VenTure markeT

in chile

Santiago Stock Exchange signed an agreement with

the subsidiary TSX Venture Exchange of the Canadian

Stock Exchange to create a venture market in Chile,

replicating the success achieved by this Canadian

company. This initiative required a survey of all

relevant policy changes necessary to incorporate the

mining exploration segment in the stock exchange.

Santiago Stock Exchange hopes to bring this project to

fruition in the coming years. New initiatives in the field

of venture capital are expected in the future.

20 13Achieve ments

Santiago Stock Exchange has favored the construction and development of a strong securities mar-

ket, through the continuous search for new opportunities. There are multiple projects supporting

this objective, delivering innovative tools to customers that ensure optimal conditions to operate in

the capital market.

MILA: PROMOTING THE REGION AS A MAJOR INVESTMENT POLE

The Integrated Latin American Market (MILA) was conceived as an integration project of the ex-

changes and depositories of Chile, Peru and Colombia, with the aim to increase the exposure in these

countries markets. Since its launch in May 2011, it has gained significant attention within the inter-

national financial community, becoming an attractive pole of investment in Latin America.

MILA has been operating for two years and has achieved the objective of enhancing the supply of

products and opportunities for local and foreign investors. Furthermore, it has been the key support

for the financial transformation of the region.

To date, six investment funds have been created to follow MILA. There are also two sector indices

(S&P MILA Financials and S&P MILA Resources) and a special index (S&P MILA 40), all of which testify

to the current interest in this investment alternative.

As a result of this positive development, MILA now has new challenges to move towards its consol-

idation over the next few years. Work remains to harmonize market rules, clearing and settlement

rules, and tax and foreign exchange operations, under the frame of the Pacific Alliance. Additionally,

the market is expected to be promoted and disseminated amongst foreign investors to increase its

regional presence. It is also expected to include new types of instruments such as investment fund

quotas and ETFs, to incorporate international custodians, and strengthen settlement processes.

Important steps in MILAs growth include the advances achieved in the incorporation of the Mexican

securities market, scheduled for 2014. This will result in greater diversification and depth, delivering

further investment alternatives, both in the number of issuers as in the diversification of markets

and sectors.

mila has gained significant attention within the international financial community, becoming an attractive pole of investment in latin america.

/ OUR CHALLENGES / MAKING PROGRESS ON A MULTI - MARKET EXCHANGE



santiago stock exchange is working with toronto stock exchange (tsx), with the support of the mining ministry, to implement a venture

market for the mining industry.

SANTIAGO STOCK EXCHANGE VENTURE: NEW VENTURE MARKET FOR MINING

EXPLORATION IN CHILE

The strong growth experienced by the mining sector, its tremendous potential and its important

role in the Chilean economy have generated consensus between public and private stakeholders

regarding the need to involve the stock market in its financing.

Therefore, Santiago Stock Exchange signed an agreement in 2012 with Toronto Stock Exchange (TSX),

with the support of the Mining Ministry. The aim is to work together to implement a venture market

segment to provide a listing for mining companies that are still in the exploration phase.

The joint work of both stock markets seeks to learn from the successful experience of Toronto Stock

Exchange, particularly from TSX Venture Exchange, which specializes in companies that are still at an

exploration phase, aiming to replicate its business model and adapt it to the Chilean market.

The Canadian mining capital market has enjoyed several decades of development during which

financing mining has become highly specialized. This covers each element of the whole busi-

ness chainexploration, development and exploitationthrough its various participants: in-

termediaries, lawyers, analysts, institutional investors, natural investors, regulators and sup-

pliers of market infrastructure such as the stock exchange itself, depositories and clearing and

settlement houses. As a result, the Canadian market is currently the world leader in financing

mining projects, supported by a substantial base of junior companies and a large number of

investors who participate in this market.

In developed markets, the participation of junior mining companies in exploration investment rep-

resents between 50% and 60% of the total. Meanwhile in Chile they still represent less than 20%, so

the development of a specialized capital market for junior mining companies should increase their

participation and multiply that investment.

Bearing in mind that the expenditure estimates for mining exploration in Chile fluctuate between

USD 1.0 and 1.5 billion annually, this new market could release additional potential investment

for junior mining companies in the range of USD 500 to 750 million annually.


DERIVATIVES MARKET: NEW INVESTMENT ALTERNATIVES FOR

SPECIALIZED INVESTORS

Santiago Stock Exchange is working in conjunction with local regulatory bodies to implement a de-

rivatives market, with the objective of furthering its spectrum of improved and innovative services

for customers. This project is reaching its final stages, and is waiting for the final regulatory changes

to be approved to begin operations.

This initiative has been developed with the participation and advice of BM&FBovespaa major

global derivatives marketand CCLV. This will strengthen and promote the development of a deriv-

atives market in Chile and open up new investment opportunities.

When in operation, this new market will allow progress in the diversification process, risk manage-

ment, and in the liquidity and depth of the domestic capital market, thanks to the sophisticated in-

struments it delivers to investors.

The derivatives market at Santiago Stock Exchange will begin with the trading of IPSA futures and US

dollar futures, to be followed in a second stage with fix income futures.

LEADERS IN THE DEVELOPMENT AND PROMOTION OF SUSTAINABLE PROCESSES IN

THE LOCAL SECURITIES MARKET

In 2013, Santiago Stock Exchange announced the launch of a bidding process to select an expert on

sustainability to develop a sustainability index for the stock market. The purpose of this index will

be to promote the incorporation of sustainable processes and socially responsible practices within

companies listed on the Chilean stock market, give greater visibility to those companies that comply

with relevant international standards and provide additional information to investors.

The process continues with a study of existing models in international markets, a study of the cur-

rent situation in Chile regarding sustainability, and the desing of a model to determine the methodol-

ogy to clasify companies participating in a sustainability index for Santiago Stock Exchange.

This initiative stimulated great interest and brought together a total of 17 expert institutions in sus-

tainability issues11 local entities and 6 internationalincluding institutions that generate indi-

ces, risk rating agencies, private consultants and academic partnerships. Santiago Stock Exchange,

as the local stock market leader, is creating incentives and developing options to encourage the in-

corporation of sustainable processes by companies listed on the Chilean stock exchange, thus help-

ing create value in those companies.


the derivatives market will allow progress in the diversification process, risk management, and in the liquidity and depth of the domestic capital market, thanks to the sophisticated instruments it delivers to investors.

through the sustainability index, santiago stock exchange hopes to encourage the incorporation of sustainable processes by companies listed on the local stock exchange.


2013the bidding process to

develop a sustainability

index was launched.


02 NUESTRA BOLSAProyectos Bolsa de Santiago

DEBT

MONEYMARKET

BONDS

CFI

DERIVATIVES OPTIONSFUTURES

SHARESEQUITY MARKET

CURRENCY


the stock market will migrate the fixed income and money market trading systems to the new technological platform. this will give foreign investors direct access to this market.

CONNECTIVITY FOR INVESTORS, INTERMEDIARIES AND ISSUERS

Santiago Stock Exchange is continuously concerned with expanding the market and offers world

class technology services to meet the needs of investors, intermediaries and issuers.

Therefore, Santiago Stock Exchange is working on the migration of trading systems for fixed income

instruments (IRF) and money market instruments (IIF) on the new HT platform as the standard pro-

tocol for communication. This will give foreign investors direct access to the local debt market. In

addition, customers will have greater processing capacity and speed, access to new trading func-

tionality, easier order tracking, automatic transaction recording, and greater dissemination of infor-

mation through Market Data.

In parallel, Santiago Stock Exchange will migrate the current custody systems to the HT platform,

thereby improving the usability and functionality of the custody system. This will allow the user to

determine the value of deposits and withdrawals on-line, immediately reflect these in positions, con-

duct bulk entry of registries from their own back office systems, simplify the operating process for

the withdrawal and release of guarantees, and automate processes, controls and information flows.


OUR / BROKERAGE HOUSES /

Santiago Stock Exchange supports brokerage houses in the expansion,

diversification and growth of their businesses to build together a more ac-

cessible, broad, dynamic and global market.

It also works to provide intermediaries with new alternatives and business

opportunities according to their challenges and needs, developing prod-

ucts and services that facilitate the commercial and operational manage-

ment of their clients.

In recent years, Santiago Stock Exchange has increased both the diversity

of financial instruments offered and connectivity by giving direct access

to their local and foreign clients.

SANTIAGO STOCK EXCHANGE DELIVERS BROKERAGE HOUSES ALTERNATIVES AND OPPORTUNITIES TO

SUPPORT THEIR COMMERCIAL AND BUSINESS MANAGEMENT.

Santiago Stock Exchange supports brokerage houses in the expansion, diversification and growth of their businesses.


On November 27, 1893, Santiago Stock Exchange was founded, a momen-

tous step in the injection of vitality and dynamism to the Chilean economy.

Under the chairmanship of Jorge Montt, the decree was signed with an ini-

tial capital of CLP 50,000. Thus, share trading began with around 50 registe-

red companies that were mostly banks, mining, insurance, sodium nitrate

mines and livestock companies.

The iconic building that currently houses the stock exchange was opened

in 1917 after four years of construction.

Over the years, many events have affected the operations of Santiago

Stock Exchange. The economic crisis of the early 30s affected Chile and the

vast majority of countries. Until 1929, the stock market enjoyed a period of

prosperity; an economic boom that resulted from the favorable situation

both in the global and the Chilean economy. But in September 1929, this

positive trend came to an end. In 1930, there was a general collapse in the

value of securities.

The period from 1930 to 1960 was unpromising for stock trading. It began

with a deep depression, that ended in 1932 to give way to a stage of consi-

derable activity. With the coming into power of the Popular Front in 1938,

a process of deterioration began, related to expectations arising from the

impending Second World War.

a. Board of Directors dining hall, 1955; b. Side of the Santiago Stock Exchange building taken from the street, 1955; c. 50 years, article in Zig Zag; d. Building inauguration ceremony, 1917; e. Santiago Stock Exchange shareholders, 1925; f. Building framework; g. Rear facade; h. Staircase.

a.

b.

OUR FIRST 65 YEARS /

/ 120 YEARS / OF HISTORY

One year after the fiftieth anniversary of the creation of Santiago Stock

Exchange in 1944, gold coins and dollars began to be traded, thus opening

up a fledgling business that went beyond shares. However, just as today,

shares in listed companies continue to be the best-known instruments

that are traded on Santiago Stock Exchange. For this reason, in 1958 the

General Stock Prices Index (IGPA) was established, which brought together

all securities from the Chilean economys various sectors.

With a centuries-old history the main achievements of Santiago Stock Ex-

change intersect with the development of the Chilean economy and aim

to add depth to the stock market, integrate it with international financial

markets, incorporate new technologies available to the securities indus-

try, and strengthen participation of local and foreign investors in the Chi-

lean stock market.


banco de chile, gasco s. a. and compaa sudamericana de vapores s. a. are pioneering companies that have been listed since the inception of santiago stock exchange.


/ Timeline / igpa evolution 1958-2012, Milestones of santiago stock exchange and the chilean econoMy

IGPA evolutIon

1989

General Stock Price index (iGPa) iS created.

1958

the SantiaGo Stock exchanGe iS incorPorated aS a foundinG member of the ibero-american federation of exchanGeS, fiab.

1973

the Selective Stock Price index (iPSa) iS created.

1977

the firSt network of work StationS with real-time

information iS imPlemented.

the manual auction SyStem for fixed-income inStrumentS and

money market inStrumentS waS created, throuGh which the afPS

conduct their oPerationS.

1981

1981 1986 1999 2001 2007 2010

2011

the iPSa achieved annual Growth record in Stock market

hiStory of 139.4%.

the telePreGon SyStem waS created, the firSt comPuterized

Stock tradinG SyStem.

incorPoration of SantiaGo Stock exchanGe into the world

federation of exchanGeS (wfe) and the creation of the

inveStment fund quota market.

SantiaGo Stock exchanGe celebrateS 100 ye arS of hiStory

and unveilS a new electronic quotation board.

the electronic auction SyStem for fixed-income inStrumentS and money market

inStrumentS waS created, allowinG direct ParticiPation by inStitutional inveStorS:

afPS, inSurance comPanieS, mutual fundS, bankS and brokeraGe houSeS.

SantiaGo Stock exchanGe beGinS oPeratinG in the

foreiGn SecuritieS market

a local exchanGe traded fund (etf) that followS

the iPSa iS launched in chile.

the new tradinG SyStem for equitieS telePreGon ht beGinS

oPeratinG.

the comPany cclv, contraParte central S.a. StartS oPeratinG. thiS iS a new comPany formed by SantiaGo Stock exchanGe for the Settlement of Stock

exchanGe tranSactionS.

the comPany SelectionS for the iPSa and iGPa are amended,

and indiceS for mid-, larGe- and Small-caP comPanieS are

created.

Sector indiceS are officially launched on SantiaGo Stock

exchanGe.

the on-line SyStem of debt SettlementS iS

imPlemented.

Sebra iS imPlemented aS the comPuterized SyStem

for SantiaGo Stock exchanGe oPerationS.

the iPSa chanGeS to a SinGle baSe of 1,000 PointS.

tranSactionS beGin in the emerGinG comPanieS

market.

1986 1988 1991 1993 2000 201220102007200520032002

corPorationS law iS enacted.

the PenSion fund adminiStratorS (afP) are created, becominG the PrinciPal

inStitutional inveStorSin the Stock market.

1984

the ProceSS of PrivatizinG chilean State-ownedenterPriSeS beGinS.

the afPS are authorizedto inveSt in StockS.

take-overS and merGerSlaw iS enacted.

caPital market i iS enacted, followed by law 19.768 and

19.769 makinG tax chanGeS and makinG inveStmentS more flexible

for mutual fundS, inSurance comPanieS, amonGSt otherS

caPital market ii iS enacted, law 20,190, introducinG tax and

inStitutional chanGeS to Promote the venture caPital induStry,

and the caPital market S modernization continueS.

law 20,448 for the caPitalmarket iii which introduceS a SerieS of reformS in termS of

liquidity, financial innovation and inteGration in the caPital

market iS PromulGated.

the new law on corPorate Governance comeS into force.

the Self-reGulation committee of SantiaGo Stock exchanGe iS

created.

the inteGrated latin american market (mila) beGinS

oPerationS, brinGinG toGether the Stock exchanGeS of

SantiaGo, lima and colombia.

2009

exchanGe traded fundS (etfS) beGin to be traded in the foreiGn Stock market of SantiaGo Stock

exchanGe.

mile

Ston

eS in

the c

hile

an ec

onom

ySa

ntia

Go St

ock

exch

anGe

mile

Ston

eS

c. d.

e.

f. g. h.


3CAPITAL MARKET DEVELOPMENT IN FIGURES

OUR ECONOMY AND STOCK MARKET IN 2013


Sources: National Statistics Institute (INE), Chilean Central Bankl ((1) = World Bank 2012

POPULATION:

17.46 MM(1)

PIB PER CPITA (PPP):

USD 22,636(1)

UNEMPLOYMENT:

5.7 %

RATING:

A+ ; AA-

EXPORTS:

USD 77,368 MM

TRADE BALANCE:

USD 74,990 MM

TRADE BALANCE:

USD 2,377 MM

INFLATION:

3.0 %

GDP GROWTH:

4.1 %

GDP:

USD 269.9 B(1)

/ THE ECONOMY / IN FIGURES

03 OUR ECONOMY AND STOCK MARKET IN 2013


MM

CH$ D

E 200

8

ANNU

AL V

ARIA

TION

0

100,000,000

120,000,000

80,000,000

60,000,000

40,000,000

20,000,000

-2.00%

-1.00%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

PIB ANNUAL VARIATION

2004

76,987,661

7.02%

2005

81,742,969

6.18%

2006

86,397,688

5.69%

2007

90,856,522

5.16%

2008

93,847,932

3.29%

2009

92,875,262

-1.04%

2010

98,227,638

5.76%

2011

103,963,086

5.84%

2012

109,558,126

5.38%

2013

114,022,307

4.07%

PIB

ANNUAL VARIATION

OTHER

CORPORATE SERVICES

MINING

PERSONAL SERVICES

MANUFACTURING

COMMERCE

CONSTRUCTION

FINANCIAL SERVICES

PUBLIC ADMINISTRATION

HOUSING SERVICES

TRAN

SPOR

TATIO

N16%

16%

12%

12%

11%

9%

9%

5%

5%5%

4%

GROSS DOMESTIC PRODUCT 2004 -2013 /

GDP PER INDUSTRY /

Source: Chilean Central Bank


this represents a decrease with respect to

2010, 2011 and 2012.

4.1%the change in the

gross domestic

product estimated for

2013 is

Other sectors with

relevant contributions

include manufacturing,

commerce and

construction.

40%

corporate services,

personal services

and mining together

contributed more than

of the Chilean gross

domestic product.


CHANGE IN MONTHLY ECONOMIC ACTIVITY INDICATOR (IMACEC) 2013 /

0.00%

7.00%

JAN

6.40%

FEB

4.10%

MAR

3.70%

APR

4.40%

MAY

3.60%

JUN

4.10%

JUL

5.60%

AUG

4.30%

SEP

4.30%

OCT

2.80%

NOV

2.80%

DEC

2.60%

6.00%

5.00%

4.00%

3.00%

2.00%

1.00%

%


CHANGE ANNUAL CPI 2000 - 2013 /

-2.00%

CPI

10.00%

8.00%

6.00%

4.00%%

2.00%

0.00%

2000

4.53%

2001

2.64%

2002

2.82%

2003

1.07%

2004

2.43%

2005

3.66%

2006

2.57%

2007

7.82%

2008

7.09%

2009

-1.38%

2011

4.44%

2010

2.97%

2012

1.49%

2013

3.01%

Source: National Statistics Institute (INE)

October, november and december posted the lowest

growth, below 3%.

JAN | JULmonths posting

strongest economic

figures in 2013

in line with the average

for the past four years. 3.01%In 2013, the consumer price index posted an annual variation of




5.20%

6.60%

FEB

6.2%

MAR

6,2%

APR

6.4%

MAY

6.4%

JUN

6.2%

JUL

5.7%

AUG

5.7%

SEP

5.7%

OCT

5.8%

NOV

5.7%

DEC

5.7%

6.40%

6.20%

6.00%

5.80%

5.60%

5.40%

UNEMPLOYMENTRATE

JAN

6.0%

%

UNEMPLOYMENT RATE 2013 /

-0.60%

0.80%

CHANGE (%)

0.60%

0.40%

0.20%

0.00%

-0.20%

-0.40%

JAN

0.17%

FEB

0.12%

MAR

0.39%

APR

-0.48%

MAY

-0.01%

JUN

0.64%

JUL

0.26%

AUG

0.25%

SEP

0.54%

OCT

0.14%

NOV

0.38%

DEC

0.59%

%

CHANGE IN CPI (LTM) IN 2013 /


may and april reported the lowest

variations.

JUN / SEPT / DECThe months with

the highest change

CPI were

during 2013, unemployment rates remained

low, ending the year at 5.7%, which is 0.7%

lower than the months with the highest

rates (april and may).

unemployment rate for

last quarter of 2013.5.7%



BALANCE OF PAYMENTS 2003 - 2013 /

MMUS

$

-6,000

4,000

2,000

0

-2,000

-4,000

6,000

8,000

10,000

12,000

14,000

16,000

1,647.7

306.5

-366.8

-190.8

-365.6

BALA

NCE O

F PAY

MENT

S

14,190.1

3,023.8

6,444.2

-3,214.1

1,997.4

1,715.7

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

TRADE BALANCE 2003 - 2013 /

MMUS

$

0

2003

3,765.4

21,650.9

17,885.5

2004

10,156.1

33,025.4

22,869.3

2005

11,309.5

41,974.0

30,664.5

2006

22,946.8

59,380.2

36,433.4

2007

24,13.8

68,561.4

44,429.6

2008

6,074.1

64,510.1

58,436.0

2009

15,360.0

55,462.7

40,102.6

2010

15,634.3

71,108.6

55,474.2

2011

10,544.5

81,455.2

70,910.8

2012

3,421.9

78,277.0

74,855.1

2013

2,377.4

77,367.5

74,990.0

90,000

50,000

40,000

30,000

20,000

10,000

60,000

70,000

80,000

TRADE BALANCE EXPORTS IMPORTS

TRADE BALANCE

EXPORTS

IMPORTS


2,377 for 2013, exports of mmus$77,367 and imports

of mmus$ 74,990 were reported, giving a positive trade balance of mmus$ 2,377.

Positive trade

balance of

MMUS$

the balance of payments for 2013 was slightly

positive with a surplus of mmus$ 306.5. this is in line with 2012 but well below the surplus

of mmus$ 14,190 recorded in 2011.



CENTRAL BANK INTERNATIONAL RESERVES 2000 - 2013 /


MMUS

$

0

INTERNATIONAL RESERVES

30,000

20,000

15,000

10,000

5,000

35,000

40,000

45,000

25,000

2001

14,400

2002

15,351

2003

15,851

2004

16,016

2005

16,963

2006

19,429

2007

16,910

2008

23,162

2009

25,373

2010

27,864

2011

41,979

2012

41,650

2013

41,094

2000

15,110

EVOLUTION OF THE AVERAGE DOLLAR 2000 - 2013 /

430.00

DOLLARVALUE

730.00

680.00

630.00

580.00

530.00

480.00

2000

472.28

2001

634.76

2002

689.50

2003

69.04

2004

609.48

2005

559.68

2006

530.34

2007

522.55

2008

522.35

2009

559.15

2010

510.22

2013

495.18

2012

486.59

2011

483.57

CHILE

AN P

ESOS

PER

DOL

LAR


the chilean central banks international

reserves decreased slightly with respect

to 2011 and 2012, but continued to be over

mmus$ 40,000.

which is slightly above 2011

and 2012 but still beneath

the ch$ 500 threshold.

$495.18

the average

dollar for the

year 2013 was


AVERAGE REAL ANNUAL INTEREST RATE2000 - 2013 /

REAL

ANN

UAL I

NTER

EST R

ATE

0.00%

6.00%

5.00%

4.00%

3.00%

2.00%

1.00%

REAL ANNUALINTEREST RATE

2000

5.17

2001

3.74

2002

1.94

2003

1.76

2004

1.07

2005

1.89

2006

2.83

2007

2.20

2008

2.23

2009

3.13

2011

2.44

2010

1.31

2012

3.50

2013

2.89



AVERAGE MONTHLY DOLLAR 2013 /

CHILE

AN P

ESOS

PER

DOL

LAR

430.00

550.00

530.00

510.00

490.00

470.00

450.00

DOLLAR VALUE

JAN

472.28

FEB

472.42

MAR

472.44

APR

472.1

MAY

480.94

JUN

503.26

JUL

505.34

AUG

512.32

SEP

504.26

OCT

500.96

NOV

520.35

DEC

529.2

This is 0.61% lower than the prior year

figure. The average since 2000 is 2.58%.

2.89%the average

annual interest

rate in 2013 was

during 2013, the u.s. dollar appreciated

9.4% with respect to the chilean peso. the

greatest increases were reported in june and

november.

was the dollar appreciation

with respect to the Chilean

pesos9.4%



In 2013, traded volumes and number of trades on Santiago Stock Ex-

change increased sharply, expanding the market by 13.5% over 2012,

with the debt market leading the way. The equity market remained sta-

ble regarding the prior year with total traded volumes of MMUS$ 46,501.

In a particularly complex period for the equity market Selective Stock

Price Index (IPSA) fell 14% during the yearinvestors sought refuge in the

debt market, which explains the stability in the equity market and growth

in money market and fixed-income securities.

The foreign securities market doubled its traded volume from 2012 with

transactions totaling MMUS$ 138 and number of trades rising 210% over

the prior year. This can be explained by a sharp rise in recent listings of fore-

ign securities, increasing from 544 in 2012 to 678 in December 2013.

One of the highlights of the year was the implementation of the first ex-

change traded fund (ETF) indexed to the Selective Stock Price Index (IPSA),

launched in September 2013. This ETF recorded daily total traded volumes

of MMUS$ 589,646.

TOTAL TRADED VOLUME AND NUMBER OF TRADES IN 2013 /

/ SUMMARY 2013 / OF THE STOCK MARKET

SHARP INCREASE IN SANTIAGO STOCK EXCHANGE DEBT MARKET IN 2013 /

total traded volume recorded by santiago stock exchange

in 2013, considering all markets, amount to mmus$ 1,098,044, exceeding total traded volumes in 2012 by 13.5%. the total

number of trades in 2013 exceeded 2012 figures by 8.1%.

1,098,044total traded volume

in 2013

MMUS$

400,000

350,000

500,000

450,000

300,000

250,000

200,000

150,000

100,000

50,000

TOTA

L TRA

DED

VOLU

ME (M

MUS$

)

TOTA

L TRA

DES

0

120,000

100,000

80,000

60,000

40,000

20,000

0

TOTAL TRADED VOLUME (MMUS$) TOTAL TRADES

FEB

78,110

354,105

JAN

93,290

424,683

MAR

78,173

376,454

APR

90,869

391,891

MAY

101,779

405,998

JUN

96,484

444,943

JUL

98,844

435,088

AUG

90,918

422,865

SEP

85,079

404,996

OCT

97,719

430,038

NOV

95,331

397,348

DEC

91,446

381,836TOTAL TRADES

TOTAL TRADED VOLUME (MUS$)

(*) FIGURES EXPRESSED IN MILLIONS US DOLLARS.


IPSA INDEX IN 2013 /


INDE

X

CHAN

GE (%

)

0

4,000

3,500

5,000

4,000

3,000

2,500

2,000

1,500

1,000

500

-6,00%

-8,00%

-10,00%

-4,00%

-2,00%

0,00%

2,00%

4,00%

6,00%

8,00%

INDEX (POINTS) CHANGE (%)

01-2013

4,552.40

5.83%

02-2013

4,558.46

0.13%

03-2013

4,432.14

-2.77%

04-2013

4,292.14

-3.15%

05-2013

4,191.26

-2.35%

06-2013

4,029.67

-3.85%

07-2013

3,732.54

-7.37%

08-2013

3,628.73

-2.78%

09-2013

3,823.85

5.37%

10-2013

3,912.44

2.31%

11-2013

3,789.06

-3.15%

12-2013

3,699.19

-2.37%

INDEX (POINTS)

CHANGE (%)

during 2013 the ipsa, blue-chip index of the sse, fell 14%. which compares

unfavorably with the 3% rise in 2012.

The IPSA fell

during 2013 14%

PARTICIPATION BY MARKET 2013 /

in 2013, more than half of the total trades

on the santiago stock exchange were in

money market instruments, followed by

currency market with 26.1% of transactions.

equities trading represented 4.3% of total

transactions.

51.4%Money MarketINVESTMENT FUND QUOTAS 0.1%

STOC

KS 4.3%

FIXED - INCOME

MONEY MARKET

CURRENCY

51,4%

18,2%

26,1%

FOREING SECURITIES 0,01%


STOCK MARKET INDICES OF SANTIAGO STOCK EXCHANGE CHANGE IN 2013 /

INDE

X

% CHANGE

IPSA-14.00

IGPA-13.49

INTER-10-16.80

IGPA SMALL-14.92

IGPA LARGE-14.43

COMMODITIES-21.90

CONST.&INMOB.-36.03

CONSUMO-12.96

INDUSTRIAL-22.20

RETAIL-15.91

BANCA-1.56

UTILITIES-2.14

IGPA MID-5.95

0.00

-15.0

0

-20.

00

-25.0

0

-10.

00

-5.0

0

-30.

00

-35.0

0

-40.

00


ONE STOCK EXCHANGE, MULTIPLE MARKETS /

Santiago Stock Exchange provides various markets which currently

trade more than USD 2.0 billion daily in shares, fixed-income instru-

ments, money market instruments, investment fund quotas and for-

eign securities.

During the last decade, Santiago Stock Exchange has been expanding

its activities by rising above its local scope to become a focus of in-

terest to global investors and a strategic partner with various stock

exchanges in the region. Highlights include the commitment with

BM&FBovespa in Brazil to develop the new derivatives market, the as-

sociation with the Colombian and Peruvian stock exchanges to create

the Integrated Latin American Market MILA, and the joint project with

a Canadian stock exchange to develop a venture market with a focus

on mining.

PARTICIPATION BY MARKET (2004 - 2013) /

Also, Santiago Stock Exchange has prioritized the supply of new secu-

rities, such as the creation of tradable investment fund quotas, ETFs,

and the derivatives market. The regulations for this latest initiative are

in the final approval stage with regulatory bodies, after which the proj-

ect will proceed. It will be an important step for the local market, sup-

porting significant progress in diversification and risk management,

and adding liquidity and depth to the domestic capital market.

over the past 10 years, money market

transactions represent 49% of the total

number of transactions carried out in

santiago stock exchange, fixed income

transactions represent 25.7%, currency

transactions represent 19.2%, and stock

trading represents 5.9%.

THE SANTIAGO STOCK EXCHANGE OFFERS LOCAL AND FOREIGN INVESTORS THE OPPORTUNITY TO

PARTICIPATE IN MULTIPLE MARKETS THAT HAVE BEEN DEVELOPED ALONG WITH THE CAPITAL MARKET.

FOREIGN SECURITIES 0,01% INVESTMENT FUND QUOTAS 0,1%

STOC

KS

FIXED-INCOME

MONEY MARKET

CURRENCY

49%

25,7%

19,2%

5,9%

Money

market 49%Fixed

Income 25.7%



IPSA INDEX GROWTH 2004 - 2013 /

STOCK MARKET INDICES FOR THE SANTIAGO STOCK EXCHANGE2004 - 2013 /

CHAN

GE (%

)

INDE

X

0

5,000

4,000

3,000

2,000

1,000

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

INDEX CHANGE (%)

2004

1,796.48

20.99%

2005

1,964.47

9.35%

2006

2,693.22

37.09%

2007

3,051.83

13.31%

2008

2,376.42

-22.13%

2009

3,581.42

50.70%

2010

4,927.53

37.58%

2011

4,177.53

-15.22%

2012

4,301.38

2.96%

2013

3,699.19

-14.00%

INDEX

CHANGE

(*) THE CHANGE (%) CORRESPONDS TO THE PERIOD 2007 - 2013.

VARI

ACI

N (%

)

-50

200

150

105.9

1

103.3

7

144.

66

121.6

4(*)

-6.5

1(*)

-18.52

(*)

54.12

(*)

-6.55

(*)

30.2

9(*)

41.9

1(*)

20.2

8(*)

80,4

6(*)

20.2

2(*)

50

100

0

NDICE

IPSA

IGPA

INTE

R-10

IGPA

SMAL

L

IGPA

MID

IGPA

LARG

E

BANC

A

COMM

ODITI

ES

CONS

T. &

INMO

B.

INDU

STRI

AL

RETA

IL

UTILI

TIES

CONS

UMO

between 2004 and 2013, the ipsa increased

by 106% from 1,796.48 as of year-end 2004

to 3,699.19 as of year-end 2013.

IPSA

increase106%


TOTA

L TRA

DED

VOLU

ME (M

MUS$

)

TRAD

ES

00

2004

20,094

426,964

2005

27,724

629,329

2006

39,909

656,391

2007

62,140

996,010

2008

44,212

869,387

2009

47,593

1,047,832

2010

62,117

1,882,672

2011

58,713

2,234,004

2012

46,603

1,968,889

2013

46,501

2,137,447TRADES

TOTAL TRADEDVOLUME (MMUS$)

TOTAL TRADED VOLUME (MMUS$) TRADES

10,000

20,000

30,000

40,000

50,000

60,000

70,000

2,000,000

2,500,000

1,500,000

1,000,000

500,000


EQUITY MARKET GROWTH 2004 - 2013 (*) /

INVESTMENT FUND QUOTAS (CFI) MARKET GROWTH 2004 - 2013 (*) /

4,000

5,000

6,000

3,000

2,000

1,000

0

500

1,000

1,500

2,000

2,500

3,000

TOTA

L TRA

DED

VOLU

ME (M

MUS$

)

2004

310

209

2005

249

332

2006

916

657

2007

2,124

971

2008

1,471

999

2009

891

1,734

2010

1,276

2,461

2011

1,069

2,895

2012

1,175

3,717

2013

1,070

5,693TRADES



TRAD

ES


0

significant growth has been

obtained over the past 10 years,

both in number of trades and

total traded volume.CFI

in 2007, the equity market recorded the

highest annual number of trades in

chilean stock market history, reaching

total traded volume of mmus$ 62,140

Highest total

traded volume in

history 62,140MMUS$



600,000

700,000

500,000

400,000

300,000

200,000

100,00050,000

100,000

150,000

200,000

250,000

300,000

350,000

TOTA

L TRA

DED

VOLU

ME (M

MUS$

)

TRAD

ES

0 0

2004

194,534

458,039

2005

190,318

495,631

2006

153,907

596,636

2007

181,778

591,438

2008

199,962

510,857

2009

234,923

504,885

2010

201,378

368,218

2011

241,545

351,911

2012

172,988

303,095

2013

199,948

318,543TRADES


TOTAL TRADED VOLUME (MMUS$) TRADES(*) FIGURES EXPRESSED IN MILLIONS US DOLLARS.

FIXED-INCOME INSTRUMENTS (IRF) MARKET GROWTH2004 - 2013 (*) /

MONEY MARKET INSTRUMENTS (IIF) MARKET GROWTH2004 - 2013 (*) /

400,000

500,000

600,000

700,000

800,000

900,000

300,000

200,000

100,000

TRAD

ES

TOTA

L TRA

DED

VOLU

ME (M

MUS$

)

0 0


2004

144,288

225,607

2005

219,999

353,924

2006

283,534

462,357

2007

337,602

577,780

2008

374,225

665,661

2009

400,230

758,911

2010

445,236

686,097

2011

479,345

736,328

2012

512,767

797,946

2013

564,204

823,052TRADES


200,000

100,000

300,000

400,000

500,000

600,000


between 2004 and 2013, the number

of money market trades tripled and

traded volume quadrupled.Money Market

in 2013, the fixed-income instrument market recorded

total traded volumes of mmus$ 199,948 or 15.6% greater than in 2012.

Fixed-income

instrument

market 15.6%


CURRENCY MARKET GROWTH 2004-2013 (*) /

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

600,000

400,000

200,000

150,000

50,000

100,000

250,000

300,000

200,000

350,000

400,000

TRAD

ES

TOTA

L TRA

DED

VOLU

ME

0 0


2004

65,317

197,316

2005

72,276

352,634

2006

81,371

517.185

2007

124,329

644,555

2008

110,619

729,578

2009

126,917

811,696

2010

167,585

1,041,325

2011

206,600

1,197,196

2012

234,043

1.431,015

2013

286,322

1,585,094TRADES



FOREIGN SECURITIES MARKET GROWTH 2006 - 2013 (*) /

3,000

4,000

5,000

6,000

2,000

1,000

TRAD

ES

TOTA

L TRA

DED

VOLU

ME (M

MUS$

)

0

60

20

40

0

100

120

80

140

160


2006

24

484

2007

11

89

2008

0.1

2

2009

2

101

2010

75

677

2011

54

1,275

2012

69

1,663

2013

138

5,163TRADES



in the period 2004 to 2013, currency instrument

trades, grew by 703%. total traded volume

increased by 338%.

growth of

currency

instrument

trades.

703%

the foreign securities market is one of the fastest growing over the past eight years,

both in terms of number of trades and total traded volume. between 2006 and 2013,

the number of trades in this market (equity and etfs) grew by more than 10 times and

total traded volume increased fivefold.

Equities and

ETFs grew

by more than 10TIMES


TOTAL TRADED VOLUME AND NUMBER OF TRADES 2004 - 2013 /

3,000,000

4,000,000

5,000,000

6,000,000

2,000,000

1,000,000

400,000

200,000

800,000

600,000

100,000,000

100,200,000

TRAD

ES

TOTA

L TRA

DED

VOLU

ME (M

MUS$

)

0 0


2004

424,545

1,308,137

2005

510,571

1,831,852

2006

559,638

2,233,227

2007

707,973

2,810,754

2008

730,489

2,776,482

2009

810,554

3,125,058

2010

877,592

3,980,773

2011

987,272

4,522,334

2012

967,577

4,504,716

2013

1,098,044

4,870,245TRADES



Over the past 10 years, the total volume traded on Santiago Stock Ex-

change, including all markets, has grown consistently, increasing from

MMUS$ 424,545 in 2004 to MMUS$ 1,098,044 in 2013, yielding a 158.6% in-

crease in that period.

This expansion was propelled by an increase in trading both on the floor

and electronically, which in both cases grew more than 260%. Also, total an-

nual number of trades grew by 272.3% during the period 2004 - 2013.

Santiago Stock Exchange demonstrates liquidity in each market, which is

reflected in the growth in total traded volume, and clearly indicates the

preference of issuers, brokers and investors.

THE INCREASE IN TOTAL TRADED VOLUME AND THE NUMBER OF TRADES AT SANTIAGO

STOCK EXCHANGE IN THE LAST DECADE ARE A DEMONSTRATION OF THE LIQUIDITY THAT

SANTIAGO STOCK EXCHANGE OFFERS TO ISSUERS, BROKERS AND INVESTORS.

PROMOTING LIQUIDITY IN THE DOMESTICSTOCK MARKET /

over the past 10 years, the total volume traded on the

santiago stock exchange, including all markets, has

grown consistently, increasing from mmus$ 424,545 in 2004 to mmus$ i,098,044 in 2013, yielding a 158.6% increase in that period.

increase in total

traded volume159%


Santiago Stock Exchange has developed different projects that further

diversify financing options through the development of new markets, as

part of their constant mission to contribute to the growth of Chilean cap-

ital markets.

Being listed on Santiago Stock Exchange awards various benefits to com-

panies, such as immediate access to securities quotes, improvements in

trading conditions, permanent market valuation and automatic listing in

the Integrated Latin American Market (MILA).

Through an initial public offering on Santiago Stock Exchange, our

listed companies have access to an important source of capital, sup-

port from institutional investors, improvements in their debt to equity

ratio as a result of being valued at their economic value, and to pro-

fessional opportunities that come from separating ownership of the

company from its management.

The initial public offerings of companies linked to the salmon industry took shape between 2007 and 2012, within which AquaChile was ranked

as the largest IPO raising MMUS$ 372. Meanwhile, sports clubs were launched on the stock exchange between 2005 and 2009.

In the past ten years, there have been 25 initial public offerings, which have

been concentrated in sectors such as construction, agriculture, retail and

salmon farming. These initial public offerings have taken place as each of

these sectors in the Chilean economy has expanded and consolidated.

Stocks from more traditional sectors such as the financial and the indus-

trial sectors have been traded on the market almost since its inception.

Between the years 1994 to 2009, nine retail companies came to market,

the first being Parque Arauco with capital raised of MMUS$ 4, and the last

being Hites, with MMUS$ 43. In this sector, the most important IPO was the

Cencosud Group, which grossed over MMUS$ 257. The same pattern oc-

curred in the real estate and construction sector, between 1995 and 2002,

where an emblematic case was Socovesa whose demand for shares was

62 times the amount placed.

CAPITAL RAISED IN THE PAST 10 YEARS IPO VERSUS DEMAND /

0 0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

5,000,00062

2 5

86

59

16

22

6

8 8

5 3 1,5

70

60

50

40

30

20

10

4,500,000

AZUL

AZU

L

SOCO

VESA

ENJO

Y

HITE

S

CRUZ

ADOS

CAMA

NCHA

CA CFR

AMOU

NTS (

MCH$

)

BID-

TO-C

OVER

RAT

IO (A

MOUN

T BID

/ AM

OUNT

PLA

CED)

AQUA

CHILE

AUST

RALIS

CRUZ

BLA

NCA ILC

INGE

VEC

HORT

IFRU

T

E IZQ

UIER

DO

MOLL

ER

AMOUNT BID AMOUNT PLACED BID-TO-COVER RATIO (AMOUNT BID / AMOUNT PLACED)

SANTIAGO STOCK EXCHANGE OFFERS COMPANIES VARIOUS FINANCING ALTERNATIVES, ALLOWING THEM TO

RAISE CAPITAL IN VARIOUS MARKETS FOR THE EXPANSION AND DEVELOPMENT OF THEIR PROJECTS.

MULTIPLE FINANCING OPPORTUNITIES FOR ISSUERS /



MAIN FIGURES FROM THE MOST RECENT 15 IPOS /

WEIGHTED-AVERAGE PLACEMENT (% INTEREST)

32%

AVERAGE FUNDS RAISED (MMUS$)

US 151,8

AVERAGE PLACEMENT PRICE (USD)

US 1,5

AVERAGE % CHANGE INDEX OF IPO

2% 3% 6%day week 52 weeks

in the last 15 ipos, the average amount placed exceeded the

companys capital by 30%, and the percentage change in their

share price during the day, week and year following placement

has shown positive trends.

30%The percentage average placement exceeds


SEGMENTATION OF INVESTORS FROM THE LAST 15 IPOs /

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

%

HORT

IFRU

T

INGE

VEC

CRUZ

BLA

NCA

SALU

D

AQUA

CHILE

MOLL

ER

ECHE

VERR

A IZ

QUIE

RDO ILC

AUST

RALIS

SEAF

OODS

CFR

PHAR

MAC

EUTI

CALS

CAMA

NCHA

CA

CRUZ

ADOS

HITE

S

ENJO

Y

AZUL

AZU

L

SOCO

VESA

RELATED TO ISSUER RETAILNIMS FOREIGN INSTITUTIONAL AFP (PENSION FUND ADMINISTRATOR)


as various economic sectors in chile expand and consolidate, companies see santiago stock exchange as an attractive financing opportunity.

At present, Santiago Stock Exchange includes 227 companies listed in

the equity market, 146 listed in the fixed income market, 58 listed in

the money market, 117 in investment funds, 401 in foreign securities

and 277 in MILA.

In 2010, Santiago Stock Exchange created the Issuers Area, a direct com-

munication channel with current and potential issuers. Ongoing infor-

mation and constant contact have allowed us to develop products and

services to suit our issuers needs.


4 COMPREHENSIVE SERVICEFOR OUR CUSTOMERSOUR PRODUCTS AND SERVICES


Universal connectivity services to enable orders to be sent directly to

the Stock Exchange.Electronic quoting and trading platform.

Exchange transaction access for brokerage houses.

Products and services focused on the distribution of market information.

Identifi cation and manage-ment of securities issuers.

Clearing and settlement service for securities trans-actions.

BUSINESSUNITS

DMA CONNECTIVITY

SERVICES

LISTING

INFORMATION SYSTEMS AND

SERVICES

TRADE WORK STATION

STOCK EXCHANGE

ACCESS

CCLV

FRONT, MIDDLE AND BACK OFFICE SOLUTIONS

Technological solutions to support an entitys operational, fi nancial and commercial management.

04 OUR PRODUCTS AND SERVICES


THROUGHOUT THE HISTORY OF SANTIAGO STOCK EXCHANGE COMPREHENSIVE

SECURITIES SOLUTIONS HAVE BEEN PROVIDED TO BOTH BROKERAGE HOUSES

AND FINANCIAL INSTITUTIONS AND INVESTORS. WE HAVE PARTICIPATED IN OUR

CUSTOMERS ENTIRE VALUE CHAIN, EXPANDING MARKETS, MINIMIZING RISKS AND

OFFERING EXCEPTIONAL SERVICES.

The development of the domestic capital market and the professionalization of financial institu-

tions have enabled Santiago Stock Exchange to define priorities that include creating new markets

and securities, as well as products and services that deliver comprehensive solutions to customers.

Santiago Stock Exchange has developed seven vertically integrated business units within the secu-

rities industry. This business model achieves greater efficiency in infrastructure use, greater econo-

mies of scale and comprehensive management of the business.

/ COMPREHENSIVE SERVICE / FOR OUR CUSTOMERS

currently santiago stock exchange has

seven business units, the latest being dma

connectivity services (direct market access)

and cclv (central counterparty)

7 businessunits


ge

61PaP

Initially, the main service offered by the Stock Exchange was trading shares, in a market physica-

lly restricted to brokers. Over time, Santiago Stock Exchange launched electronic systems which

allowed institutional investors to participate in real time in the stock market. This has resulted in a

significant increase in total traded volume in the stock and debt markets.

Santiago Stock Exchange guarantees the back-up, efficiency and transparency of all its pro-

ducts and services with world class technology, supported at all levels by a comprehensive and

solid infrastructure.

/ FROM ROUTING / TO BACK OFFICE

In recent years, the main stock market in Chile has strengthened the growth of its customers entire value

chain, diversifying markets, enhancing its products and services, incorporating new instruments, promot-

ing liquidity and developing its trading and post-trading services.

Santiago Stock Exchange provides solutions throughout all the different stages of a securities transaction:

routing, trading, information, back-office, clearing and settlement.

STOCKS

BONDS

MONEY MARKET INSTRUMENTS

DERIVATIVES

ROUT ING TRADING BACK OFF ICECLEARING AND

SE T TLEMENTINFORMAT ION

with the implementation of order routing

for the debt market and the launch of

the derivatives market in 2014, santiago

stock exchange will complete its spectrum

of services for all stages of a securities

transaction.


Santiago Stock Exchange has designed various business units with the aim of strengthening and broadening the Chilean capital market. These offer a wide range of products and services to various stakeholders that enable them to access multiple opportunities for investment, diversifi ca-tion and fi nancing.

ALL PRODUCTS AND SERVICES AVAILABLE TO THE MARKET /

/ PRODUCTS AND SERVICES /



Santiago Stock Exchange has designed various business units with the aim of strengthening and broadening the Chilean capital market. These offer a wide range of products and services to various stakeholders that enable them to access multiple opportunities for investment, diversifi ca-tion and fi nancing.

ALL PRODUCTS AND SERVICES AVAILABLE TO THE MARKET /

/ PRODUCTS AND SERVICES /



Specially designed for intermediaries and investor trading desks, this electronic platform facilitates

the quoting and trading of various types of securities, and the possibility to access all local market

information in one place.

The national network includes more than a thousand work stations, making this the leading trading

platform in the Chilean stock market.

ACCESS TO THE LARGEST TRADING NETWORK IN CHILE /

/ TRADE WORK STATIONS /


SANTIAGO STOCK EXCHANGE

BROKERLIMIT

COSTUMER BROKER

FIXGATEWAY

TRADING ENGINESSE

Fix 4.4 Fix 4.4

DMA PRODUCTS

Modelo 1

Modelo 2

Modelo 3

Modelo 4

COSTUMER NETWORK

Fix 4.4

Fix 4.4

NETWORK

BROKERLIMIT

TARGETED

Fix 4.4

Fix 4.4BROKER

LIMIT

FROM ROUTING BROKERS TARGETED

Fix 4.4Co-Location *

Fix 4.4BROKER

LIMIT

Broker

Broker

Broker

Corredor

DIRECT CONNECTIVITY WITH SANTIAGO STOCK EXCHANGE /

/ DMA CONNECTIVITY SERVICES /

Santiago Stock Exchange has agreements with the most important global routing networks: ATG

(Americas Trading Group), Bloomberg, Fidessa, Marco Polo, Fix Flyer, Raptor and Sungard. These compa-

nies provide a range of services, which include connecting international investors to the local market.

DMA (Direct Market Access) connectivity services are targeted at investors and Santiagos Stock Ex-

change includes various alternatives for connecting with the intermediaries trading platforms. This

enables buy and sell orders to be routed automatically to these platforms in real-time. These services

use the most advanced trading technology available, delivering flexibility, security, reliability and

the shortest possible lapse between order receipt and execution.

Santiago Stock Exchange offers several connection types depending on the nature of the customer.

Therefore, a brokerage house may connect directly to Santiago Stock Exchange through DMA Broker,

or they may connect their investing customer through DMA Direct, or the Stock Exchange routing net-

works may be accessed through DMA Network to connect their local and foreign customers.


Connection service that consists of leasing

space in Santiago s Stock Exchange data pro-

cessing center, adjacent to its trading engine,

to host servers or customer communication

equipment. This priviledged location enhanc-

es the speed of order processing and delivers

high standards of trust and security.

* CO-LOCATION /


This service is focused on brokerage houses, securities agents and asset management companies

and delivers a suite of technological solutions to support the integrated and efficient operation of

financial, operational and commercial management.

These solutions come with full technological support and contain tools specifically designed for the

Chilean market that are adapted to its constant growt

Documents

Securities Review 2013 05-12-2014