Service

(1) Brokerage Business
1. Services Provision
1. Brokerage in domestic and overseas securities trade.
2. Clearance, settlement and related processing of securities trade.
3. Margin Trade and Short Selling.
4. Hosting seminars and conference on security investment.
5. Introduce and assist brokerage in futures.
6. Brokerage, agency and intermediary services in securities as permitted by competent authority.


2. Competitive Advantages
1. Experienced and efficient trading service with a strict adherence to client confidentiality.
2. Professional, insightful, customized investment lectures for both domestic and foreign institutional clients to ensure that our clients are well-informed and able to foresee and understand market forces and, in turn, to capitalize upon market trends.
3. Strict adherence to risk control protocols so that the client’s interests are always protected.

3. Achievements and Prospects
MasterLink’s brokerage business generated NT$0.764 billion, compared to NT$0.26billion, in 2005, for a 193% increase. Continuing with our efforts to streamline our branch network, our total number of branches was trimmed down from 49 to 45, in 2006, yet our market share actually gained to 3.72%, placing us within the Top-10 in the industry.

Our market share in online trading also got a boost from 15%, in 2005, to 19.63%, in 2006, due largely to the launch of our new integrated equity, futures, and options trading software, MasterLink Professional Trading System (PTS), which provides a complete trading interface, a real-time market data, account management functions, and more. 

In an effort to further diversify our revenue streams, we have strengthened our branch network distribution flows, so as to market new domestic financial products, offshore products, insurance products, mutual funds, etc. These efforts have generated very positive results to our bottom line while also providing our customers with expanded access to more comprehensive financial planning options.


(2) Wealth Management
1. Services Provision
1. Know Your Client (KYC) principle employed to ascertain the particular needs and risk tolerance of each client and then provide complete and discerning asset allocation and portfolio management advice and services
2. Providing tailor-made services that meet the needs of the individual client.
3. Forging domestic distribution agreements for products from foreign financial institutions.
4. Continually building and enhancing our sales network.

2. Competitive Advantages
1. Global asset allocation models used to diversify client assets across different financial product groups, such as equities, currencies, bonds, and even across different regions, while adhering to the client’s risk tolerance parameters.
2. Diverse range of products and service in a one-stop shopping concept.
3. Experienced sales and marketing team.
4. Developed our Wealth Management System to enhance the overall level of service for our Wealth Management business.

3. Achievements and Prospects
MaserLink created its Wealth Management Department in August of 2005, and, by October, had received regulatory approval and licensing to begin offering services to the public. By the end of the year, in November, 2005, MasterLink had secured a Master Domestic Agent distribution agreement for BSI mutual funds, making us the first domestic securities firm to secure master agent distribution rights with a foreign private bank. At the same time, we completed development of our new trading and reporting system, which allows for more efficient daily offshore mutual fund operations.

We intend to continue to seek out new and high-quality wealth management products, with the aim of enhancing the range the products and services that we offer. Similarly, we will ensure that our wealth management sales team is well-trained and, thus, well-equipped to advise clients on prudent asset allocation, to provide valuable financial planning, and to recommend appropriate products and services.

(3) Proprietary Trading
1. Services Provision
1. Spot equity trading on the TSE.
2. Spot trading on the OTC market.
3. Spot trading on the Emerging Market (Pre-OTC/TSE) exchange.
4. Trading on overseas securities exchanges

2. Competitive Advantages
1. Top-notch research team; comprehensive strategy development and execution process
2. Active use of hedging tools to reduce risk exposure.
3. Strict trading controls with an emphasis on risk control.

3. Achievements and Prospects
MasterLink’s proprietary trading division made great strides in international markets in 2006, as well. Asian markets, such as Hong Kong and China, global emerging markets, commodity markets, and even developed markets, such as Europe and North American, all showed significant gains. The FED decision to not raise interest rates in the second half of the year spurned healthy global capital flows. Our proprietary trading was able to capitalize on these strong market forces and, using stringent investment screening and execution processes, was able to take positions in individual stocks with the most potential for gain.

Looking to 2007, we fully expect to build upon the momentum we have gained in both domestic and international markets by continuing to build strong ties to our research and analysis departments, so as to get a firm handle on the market, to anticipate market trends, and to capitalize on market movements. At the same time, we will continue to train and develop our domestic and international traders and analysts in strong fundamental and technical analysis techniques.


(4) Futures Proprietary Trading Division
1. Services Provision
1.Trading of Equity Index Futures and Options
2.Market Maker for Equity Index Options and Single Stock Options
3.Trading of Foreign Futures Contracts

2. Competitive Advantages
1. Extensive experience in options and futures trading
2. Able to develop diverse trading strategies
3. Qualified traders with solid experience

3. Achievements and Prospects
As the domestic futures markets continue to mature, regulators have begun launching U.S.-dollar denominated futures contracts. Our proprietary trading division is ready to participate in all domestic futures markets via sophisticated trading strategies and via a market maker role. We presently act as market maker for TAIFEX Index options, TSE Finance Sector Index Options, TSE Electronic Sector Index Options, and two single-stock index option contracts. We also employ primarily program trading strategies aimed at achieving the highest possible returns with the lowest level of risk. 

As regulations begin to allow proprietary trading of foreign futures contracts our division will be ready to enter this new business, as soon as it is available. We will also be looking for ways to use new access for foreign futures for hedging purposes, for intermarket trading strategies, and for generating steady revenue streams.


(5) Underwriting Business
1. Services Provision
1. Assist companies and organizations in appraising and conducting initial public offerings, as well as various other financial instruments and private placements.
2. Underwrite equity and debt placements.
3. Provide financial planning, appraisal and various consulting functions for private placements for publicly listed companies, for M&A operations, and for BOT projects.
4. Stock registration and related consultation services for publicity.

2. Competitive Advantages
1. Our professional underwriting team provides institutional clients with complete and comprehensive financial planning and financial consulting services.
2. Many years of experience in underwriting business and a strong track record of successful regulatory applications.
3. Provide complete and professional investment banking services that translate into profits. 

3. Achievements and Prospects

In 2006, MasterLink underwrote five of IPO and SPO issues, as well as consulting on 15 M&A deals in Taiwan and Hong Kong totally. 

Our Underwriting Department led the cross-national merger of InterVideo and Ulead Systems, in October of 2006, further enhancing MasterLink’s expertise in the M&A arena, particularly in international deals. And, as the number of Taiwanese companies conducting IPO’s on foreign exchanges grows, our underwriting department has been working very closely with our Hong Kong subsidiary so as to assist Taiwanese clients on both sides of the Taiwan Strait.

MasterLink has also forged strategic alliances with key Japanese financial holding company and Venture Capital. These moves are proof-positive of MasterLink’s intentions to become an internationally competitive financial underwriter, of our ability to weigh-in on multinational M&A activities.

As we continue to put IPO and SPO business at the forefront of our agenda going forward, we will continue to be aggressive in developing M&A business, in expanding financial consulting and services across The Taiwan Strait and around The Greater China Region, in bringing international market access to our clients, in broadening business scales. In short, we will be an international “bridge” by which clients can access capital and opportunities, beyond national borders.


(6) Fixed Income Business
1. Services Provision
1. Services Provision Government treasury and corporate debentures.
2. Bond forward/futures/option
3. Bond trade with repurchase or resale option.
4. Bonds underwriting/placement
5. Asset swap/Interest Rate Swap
6. Assets securitization business
2. Competitive Advantages
1. Powerful models on portfolio management and risk control.
2. Expertise in fixed income/interest rate derivatives. 
3. Experiences in corporate debentures underwriting/placement.
4. The major market maker of bond and derivatives.
3. Achievements and Prospects
In 2006, MasterLink sustained as a local top corporate debentures trader, reaching to NT$174.7 billion or 10.23% of the market share. The corporate bonds underwriting volume hit NT$42.5 billion, or 15.30% of the market share, keeping its top 2 position on the market. We have sustained bond option trade in top 1 position on the local market in the strait -3-rd year, shown by the figures of NT$910.1billion, or 23.47% of market shares. In the year, MasterLink also participated in underwriting of Taiwan’s first-shot foreign currency dominated corporate debenture, valued at US$ 250 million, issued by Deutsche Bank . 

As the official ban on credit or interest-rate foreign currency derivatives were lift for the past few years, MasterLink accelerated its pace in the development of new products to meet its customers’ demands. In prospective, the company would like to take the advantage of its R&D innovative know-how to offer investors more and more profitable investment opportunities.



(7) Derivatives
1. Services Provision
1. Issuance of warrants 
2. Futures and options trading
3. R & D of financial derivatives
4. Issuance of Structured Notes
5. Issuance of OTC Equity Option
2. Competitive Advantages
1. Island-wide branches as placing channel.
2. Expertise in trade of derivatives.
3. Know-how on financial derivatives R&D.
3. Achievements and Prospects
MasterLink offered 50call/put warrants, 250% growth rate YOY, meanwhile issuing a total of value of NT$2.594 billion on structured notes to sustain its top four position on the local market in 2006. MasterLink also applied to be a PD of local ETFS, such as TSEC Taiwan Mid-Cap 100 Index and Taiwan Technology Index.

To meet growing customers’ demands, MasterLink was planning to offer its derivatives products linked to overseas markets or equity option, backed up by a creative financial engineering team. In prospective, MasterLink will be prepared to trade overseas derivatives in addition to other home products. MasterLink will keep its promise in developing in R & D to provide its customers more creative investment products.
   

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