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Hyundai Capital Services, Inc. and Subsidiaries

Interim Consolidated Financial Statements June 30, 2012 and 2011

Hyundai Capital Services, Inc. and Subsidiaries Index June 30, 2012 and 2011

Page(s)

Report on Review of Interim Financial Statements .......................................................................... 1-2

Interim Consolidated Financial Statements

Interim Consolidated Statements of Financial Position ......................................................................... 3-4

Interim Consolidated Statements of Comprehensive Income ................................................................ 5-7

Interim Consolidated Statements of Changes in Equity ....................................................................... 8-9

Interim Consolidated Statements of Cash Flows .................................................................................... 10

Notes to the Interim Consolidated Financial Statements ................................................................... 11-32

1

Report on Review of Interim Financial Statements

To the Shareholders and Board of Directors of

Hyundai Capital Services, Inc.

Reviewed Financial Statements

We have reviewed the accompanying interim consolidated financial statements of Hyundai Capital Services, Inc.(the Company) and its subsidiaries. These financial statements consist of consolidated statements of financial position of the Company and its subsidiaries as of June 30, 2012 and the related consolidated statements of comprehensive income for the three-month and the six-month periods ended June 30, 2012 and 2011, and statements of changes in equity and cash flows for the six-month periods ended June 30, 2012 and 2011, and a summary of significant accounting policies and other explanatory notes, expressed in Korean won.

Management's Responsibility for the Financial State ments

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with the International Financial Reporting Standards as adopted by the Republic of Korea (Korean IFRS) 1034, Interim Financial Reporting, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to issue a report on these consolidated financial statements based on our reviews. We conducted our reviews in accordance with the quarterly and semi-annual review standards established by the Securities and Futures Commission of the Republic of Korea. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the Republic of Korea and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

2

Conclusion

Based on our reviews, nothing has come to our attention that causes us to believe the accompanying interim consolidated financial statements do not present fairly, in all material respects, in accordance with the Korean IFRS 1034, Interim Financial Reporting.

Emphasis of Matter

We audited the consolidated statement of financial position as of December 31, 2011, and the related statements of comprehensive income, changes in equity and cash flows for the year ended December 31, 2011, in accordance with auditing standards generally accepted in the Republic of Korea and expressed an unqualified opinion on those statements dated February 24, 2012. The statement of financial position as of December 31, 2011, presented herein for comparative purposes, is consistent, in all material respects, with the above audited statement of financial position as of December 31, 2011.

Review standards and their application in practice vary among countries. The procedures and practices used in the Republic of Korea to review such consolidated financial statements may differ from those generally accepted and applied in other countries. Accordingly, this report is for use by those who are informed about Korean review standards and their application in practice. Seoul, Korea August 9, 2012 This report is effective as of August 9, 2012, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying interim consolidated financial statements and notes thereto. Accordingly, the readers of the review report should understand that there is a possibility that the above review report may have to be revised to reflect the impact of such subsequent events or circumstances, if any.

Hyundai Capital Services, Inc. and Subsidiaries Interim Consolidated Statements of Financial Position June 30, 2012 and December 31, 2011

3

(In millions of Korean won)

Notes 2012 2011

Assets Cash and deposits

Cash and cash equivalents 21 \ 1,568,274 \ 1,455,433 Deposits 9 9

1,568,283 1,455,442

Securities 3 Available-for-sale securities 21,479 18,452 Investments in associates 65,874 51,768

87,353 70,220

Loans receivable 4,5,7 11,481,552 11,129,247 Allowances for doubtful accounts (279,331) (281,184) 11,202,221 10,848,063

Installment financial assets 4,5,7

Auto installment financing receivables 4,410,865 5,030,541 Allowances for doubtful accounts (30,664) (36,748) Durable goods installment financing receivables 223 1,422

Allowances for doubtful accounts (11) (141) Mortgage installment financing receivables 19,501 25,679

Allowances for doubtful accounts (316) (1,204) Machinery installment financing receivables 165 1,682 Allowances for doubtful accounts (2) (37) 4,399,761 5,021,194

Lease receivables 4,5

Finance lease receivables 2,517,796 2,278,383 Cancelled lease receivables 394 211 2,518,190 2,278,594

Leased assets

Operating leased assets 1,104,639 1,119,309 Cancelled leased assets 3,244 3,769 1,107,883 1,123,078

Property and equipment 8 325,428 265,433 Other assets

Intangible assets 9 61,316 65,117 Non-trade receivables 105,777 87,895

Allowances for doubtful accounts (3,508) (2,913) Accrued revenues 115,124 128,351 Allowances for doubtful accounts (14,023) (14,371) Advance payments 101,765 55,013 Prepaid expenses 38,608 26,434 Leasehold deposits 32,435 35,929

Hyundai Capital Services, Inc. and Subsidiaries Interim Consolidated Statements of Financial Position June 30, 2012 and December 31, 2011

4

Notes 2012 2011

Derivative assets 13 260,964 475,431 698,458 856,886

Total assets \ 21,907,577 \ 21,918,910

Liabilities Borrowings 10

Borrowings \ 2,162,331 \ 2,250,000

Debentures 15,211,314 15,522,368

17,373,645 17,772,368

Other liabilities

Non-trade payables 398,723 345,089

Accrued expenses 145,257 135,083

Unearned revenue 58,345 61,095

Withholdings 28,673 24,140

Defined benefit liability 11 25,522 20,362

Leasehold deposits received 802,907 787,858

Deferred income tax liabilities 48,208 47,884

Provisions 12 9,255 10,446

Derivative liabilities 13 60,378 58,096

1,577,268 1,490,053

Total liabilities 18,950,913 19,262,421

Equity

Common stock 1 496,537 496,537

Capital surplus Paid-in capital in excess of par value 369,339 369,339 Other capital surplus 38,200 38,200

407,539 407,539 Accumulated other comprehensive income and

expenses 20

Gain(loss) on valuation of available-for-sale Securities

199

(388)

Accumulated comprehensive income (expense) of equity method investees

(623)

47

Gain(loss) on valuation of derivatives 13 6,204 (50,156) Cumulative effect of overseas operation

translation (786)

(343)

4,994 (50,840)

Retained earnings 14 2,047,485 1,803,144

Non-controlling interests 109 109

Total equity 2,956,664 2,656,489

Total liabilities and equity \ 21,907,577 \ 21,918,910

The accompanying notes are an integral part of these interim consolidated financial statements.

Hyundai Capital Services, Inc. and Subsidiaries Interim Consolidated Statements of Comprehensive Income Three-Month and Six-Month Periods ended June 30, 2012 and 2011

5

(In millions of Korean won, except per share amounts)

Notes 2012 2011

Three

months Six

months Three

months Six

months Operating revenue

Interest income 15

Interest on bank deposits \ 11,792 \ 24,394 \ 9,760 \ 18,848

Other interest income 1,388 1,431 124 254

13,180 25,825 9,884 19,102

Gain on valuation and disposal of

securities

428 1,776 480 2,084

Income on loans 15,16 372,998 746,409 392,318 773,337 Income on installment financial

receivables 15,16 93,416 195,241 109,696 224,289

Income on leases 15,16 225,674 446,927 215,548 438,066

Gain on disposal of loans 28,807 53,619 72,075 72,075

Gain on foreign transactions Gain on foreign exchanges

translation

32,908 66,990 98,261 244,804

Gain on foreign currency transactions

6,597 18,812 27,800 29,822

39,505 85,802 126,061 274,626

Dividend income - 2,831 13 3,251

Other operating income Gain on valuation of derivatives 18,940 15,961 40,344 73,016 Gain on derivatives transactions 3,456 3,456 - 715 Others 36,544 67,641 56,401 81,077

58,940 87,058 96,745 154,808

Total operating revenue 832,948 1,645,488 1,022,820 1,961,638


6


Notes 2012 2011

Three

months Six

months Three

months Six

months Operating expenses

Interest expenses 15 225,476 \ 454,930 \ 237,999 \ 477,921

Lease expenses 16 128,779 252,746 123,787 255,356

Bad debts expense 5 96,712 179,707 79,709 139,425

Loss on foreign transactions Loss on foreign exchange

translation 18,936 15,968 40,349 73,025

Loss on foreign currency transactions

3,456 3,456 - 715

22,392 19,424 40,349 73,740

General and administrative

expenses 17 147,439 283,587 127,991 261,177

Other operating expenses

Loss on valuation of derivatives 32,913 66,989 98,273 244,821 Loss on derivatives transactions 6,612 18,834 27,810 29,837 Others 23,905 39,294 10,974 21,558

63,430 125,117 137,057 296,216

Total operating expenses 684,228 1,315,511 746,892 1,503,835

Operating income 148,720 329,977 275,928 457,803

Non-operating income

Gain on equity method valuation 3 2,516 4,659 1,894 4,749

2,516 4,659 1,894 4,749

Non-operating expenses - - - -

Income before income taxes 151,236 334,636 277,822 462,552

Income tax expense 18 35,966 90,296 68,897 108,503

Net income \ 115,270 \ 244,340 \ 208,925 \ 354,049

Net income attributable to:

Owners of the parent 115,270 244,340 208,925 354,049 Non-controlling interests - - - -

115,270 244,340 208,925 354,049


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Notes 2012 2011

Three

months Six

months Three

months Six

months Other comprehensive income, net of income taxes 20

Gain(Loss) on valuation of available-for-sale financial securities

(56) 587 \ (441) \ (407)

Other comprehensive expense of equity method investees

(648) (670) (118) (15)

Gain (Loss) on valuation of derivatives 29,627 56,361 (34,712) 27,609

Effect of overseas operation translation

(293) (443) 8 (176)

28,631 55,835 (35,263) 27,011

Total comprehensive income \ 143,901 \ 300,175 \ 173,662 \ 381,060

Total comprehensive income

attributable to:

Owners of the parent \ 143,901 \ 300,175 \ 173,662 \ 381,060

Non-controlling interests - - - -

\ 143,901 \ 300,175 \ 173,662 \ 381,060

Earnings per share attributable

to the ordinary equity holders of the company

19

Basic earnings per share

\ 1,161 \ 2,460 \ 2,104 \ 3,565

Diluted earnings per share

1,161 2,460 2,104 3,565


Hyundai Capital Services, Inc. and Subsidiaries Interim Consolidated Statements of Changes in Equity Six-Month periods ended June 30, 2012 and 2011

8

(In millions of Korean won) Capital

stock Capital surplus

Accumulated other

comprehensive income and expenses

Retained earnings

Total attributable to owners of the parent

Non-

controlling interests

Total equity Balances as of January 1, 2011 \ 496,537 \ 407,539 \ (67,371) \ 1,400,013 \ 2,236,718 \ 129 \ 2,236,847

Total comprehensive income Net income - - 354,049 354,049 - 354,049 Other comprehensive income

Loss on valuation of available-for-sale securities - - (407) - (407) - (407)

Other comprehensive income of equity method investees - - (15) - (15) - (15)

Gain on valuation of derivatives - - 27,609 - 27,609 - 27,609 Effect of overseas operation

translation - - (176) - (176) - (176)

Total comprehensive income - - 27,011 354,049 381,060 - 381,060

Transactions with owners Dividends - - - (104,272) (104,272) - (104,272)

Balances as of June 30, 2011 \ 496,537 \ 407,539 \ 40,360 \ 1,649,790 \ 2,513,506 \ 129 \ 2,513,635

Hyundai Capital Services, Inc. and Subsidiaries Interim Consolidated Statements of Changes in Equity Six-Month periods ended June 30, 2012 and 2011

9

(In millions of Korean won) Capital

stock Capital surplus

Accumulated other

comprehensive income and expenses

Retained earnings

Total attributable to owners of the parent

Non-

controlling interests

Total equity Balances as of January 1, 2012 \ 496,537 \ 407,539 \ (50,840) \ 1,803,144 \ 2,656,380 \ 109 \ 2,656,489 Total comprehensive income Net income - - 244,340 244,340 - 244,340 Other comprehensive income

Gain on valuation of available-for-sale securities - - 587 - 587 - 587

Other comprehensive income of equity method investees - - (670) - (670) - (670)

Gain on valuation of derivatives - - 56,361 - 56,361 - 56,361 Effect of overseas operation

translation - - (443) - (443) - (443)

Total comprehensive income - - 55,835 244,340 300,175 300,175

Balances as of June 30, 2012 \ 496,537 \ 407,539 \ 4,995 \ 2,047,484 \ 2,956,555 \ 109 \ 2,956,664


Hyundai Capital Services, Inc. and Subsidiaries Interim Consolidated Statements of Cash Flows Six-Month Periods ended June 30, 2012 and 2011

10

(In millions of Korean won) 2012 2011

Cash flows from operating activities

Cash generated from operations (Note 21) \ 783,531 \ 181,944 Interest received 29,334 17,936 Interest paid (415,164) (412,390) Dividends received 2,831 3,251 Income taxes paid (79,537) (87,925)

320,995 (297,184)

Cash flows from investing activities

Decrease in deposits - 3 Dividends from associates 733 707 Acquisition of investments in associates (10,850) - Acquisition of land (38,113) (1,853) Acquisition of building (22,053) (5,243) Disposal of vehicles 57 37 Acquisition of vehicles (2,337) (166) Disposal of fixtures and furniture - 14 Acquisition of fixtures and furniture (8,391) (15,955) Acquisition of other tangible assets (39) (496) Increase in construction in progress (2,317) (2,604) Disposal of intangible assets - 71 Acquisition of intangible assets (1,170) (5,910) Decrease in leasehold deposits 3,032 1,912 Increase in leasehold deposits (773) (4,183)

(82,221) (33,666)

Cash flows from financing activities

Proceeds from borrowings 1,238,225 1,300,000 Repayments of borrowings (1,325,000) (2,016,945) Issuance of debentures 2,406,025 3,152,196 Repayments of debentures (2,444,732) (1,842,033) Payments of dividends - (104,273)

(125,482) 488,945

Exchange losses on cash and cash equivalents (8) (5)

Decrease in other cash and cash equivalents (443) (176)

Net increase in cash and cash equivalents 112,841 157,913

Cash and cash equivalents

Beginning of period 1,455,433 1,224,866

End of period \ 1,568,274 \ 1,382,779


Hyundai Capital Services, Inc. and Subsidiaries Notes to the Interim Consolidated Financial Statements June 30, 2012 and 2011, and December 31, 2011

11

1. General information

Hyundai Capital Services, Inc. was established on December 22, 1993, to engage in installment

financing, facilities lease and new technology financing. The Company changed its trade name

from Hyundai Auto Finance Co., Ltd. to Hyundai Financial Services Co. on April 21, 1995, and

changed its trade name once again to Hyundai Capital Services, Inc. on December 30, 1998. In

accordance with the Monopoly Regulation and Fair Trade Act, the Company is incorporated into

Hyundai Motor Company Group. As of June 30, 2012, the Company’s operations are

headquartered in Yeouido, Seoul. Its major shareholders are Hyundai Motor Company and GE

International Holdings Corporation with 56.47% and 43.30% ownership, respectively.

The interim consolidated financial statements have been prepared and presented which included

the accounts of Hyundai Capital Services, Inc. (the “Company”), as the parent company

according to Korean IFRS 1027, and Autopia Thirty-fifth trust and SPC and other subsidiaries

(collectively the “Group”), while HK Mutual Savings Bank and four other entities are associates.

Subsidiaries as of June 30, 2012 and December 31, 2011, are as follows. The Company has the

substantial power over the subsidiaries established as special purpose entities for asset

securitization even though its ownership interests over the subsidiaries do not exceed 50%.

Location

Ratio of

ownership June 30, 2012 December 31, 2011

Special

Purpose

Entities1

Korea 0.9% Autopia Thirty-fifth SPC(trust) Autopia Thirty-fifth SPC(trust)

Autopia Thirty-sixth SPC(trust) Autopia Thirty-sixth SPC(trust)

Autopia Thirty-seventh SPC(trust) Autopia Thirty-seventh SPC(trust)

Autopia Thirty-ninth SPC(trust) Autopia Thirty-ninth SPC(trust)

Autopia Fortieth SPC(trust) Autopia Fortieth SPC(trust)

Autopia Forty-second SPC(trust) Autopia Forty-second SPC(trust)

Autopia Forty-third SPC(trust) Autopia Forty-third SPC(trust)

Autopia Forty-fourth SPC(trust) Autopia Forty-fourth SPC(trust)

Autopia Forty-fifth SPC(trust) Autopia Forty-fifth SPC(trust)

Autopia Forty-sixth SPC(trust) Autopia Forty-sixth SPC(trust)

Autopia Forty-seventh SPC(trust) Autopia Forty-seventh SPC(trust)

Stock

Company Germany 100% Hyundai Capital Europe GmbH1 Hyundai Capital Europe GmbH1

1 It holds 100% shares of Hyundai Capital Services Limited Liability Company.

2. Summary of Significant Accounting Policies

2.1 Basis of Preparation

The Group’s interim consolidated financial statements for the six-month period ended June 30,

2012, have been prepared in accordance Korean IFRS 1034, ‘Interim Financial Reporting’. These

interim consolidated financial statements have been prepared in accordance with the Korean


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IFRS standards and interpretations issued and effective or issued and early adopted as of June

30, 2012.

New standards, amendments and interpretations issued but not effective for the financial year

beginning January 1, 2012, and not early adopted by the Group are as follows:

- Amendments to Korean-IFRS 1019, Employee Benefits

According to the amendments to Korean-IFRS 1019, Employee Benefits, the corridor method is

no longer permitted. Therefore, actuarial gains and losses on the defined benefit obligation are

recognized immediately under other comprehensive income. The amendment requires to

recognize immediately all past service costs. And the amendment replaces the interest cost on

the defined benefit obligation, and the expected return on plan assets with a net interest cost

based on the net defined benefit asset or liability and the discount rate measured at the

beginning of the year. This amendment will be effective for the Group as of January 1, 2013. The

Group is assessing the impact of application of the amended Korean-IFRS 1019 on its

consolidated financial statements.

- Enactment of Korean-IFRS 1113, Fair value measurement

Korean-IFRS 1113, Fair value measurement, aims to improve consistency and reduce complexity

by providing a precise definition of fair value and a single source of fair value measurement and

disclosure requirements for use across Korean-IFRS. Korean-IFRS 1101 does not extend the use

of fair value accounting but provides guidance on how it should be applied where its use is

already required or permitted by other standards within Korean-IFRS. This amendment will be

effective for the Group as of January 1, 2013, and the Group expects that it would not have a

significant impact on the Group.

- Enactment of Korean-IFRS 1001, Presentation of Financial Statements

According to the amendments to Korean-IFRS 1001, 'Presentation of Financial Statements',

items of other comprehensive income present as two groups depending on whether it will be

reclassified subsequently to profit or loss or not. An entity shall apply those amendments for

annual periods beginning on or after July 1, 2012, and earlier application is permitted. The Group

is assessing the impact of application of the amended Korean-IFRS 1001 on its consolidated

financial statements.

2.2 Accounting Policies -

The following is a summary of significant accounting policies followed by the Group in the

preparation of its interim consolidated financial statements. These policies have been consistently

applied to all the periods presented, unless otherwise stated.

Interim period income tax expense is calculated by applying estimated average annual effective

tax rate to the interim period’s pre-tax income.


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3. Securities

Securities as of June 30, 2012 and December 31, 2011, are as follows:

(in millions of Korean won)

Type 2012 2011 Available-for-sale securities

Equity securities

Marketable equity securities \ 5,600 \ 5,687 Unlisted equity securities 11,208 10,526

16,808 16,213 Debt securities

Government and public bonds 4,671 2,239

Sub-total 21,479 18,452

Investments in associates 65,874 51,768 \ 87,353 \ 70,220

Available-for-sale securities

Available-for-sale securities as of June 30, 2012 and December 31, 2011, are as follows:

(1) Marketable equity securities

(in millions of Korean won) Book value

Number of shares

Ownership (%)

Acquisition cost 2012 2011

Marketable equity securities

NICE Information Service 136,593 2.25 \ 3,312 \ 3,118 \ 3,190

NICE Holdings 49,162 1.42 3,491 2,482 2,497

Unlisted equity securities

Hyundai Finance Corp. 1 1,700,000 9.29 9,888 11,108 10,426

Korean Egloan, Inc. 4,000 3.12 100 100 100

\ 16,791 \ 16,808 \ 16,213

1 The fair value for Hyundai Finance Corp. was valued as the average of valuation prices provided by two

external appraisers, KIS Pricing Inc. and Korea Asset Pricing, using the discounted cash flow model. The

five-year financial statements, projected based on past performance, were used in measuring the fair value

assuming that the operational structure will remain as is for the next five years. Operating income and

expenses were estimated based on the past performance, business plan and expected market conditions.

(2) Debt securities

(in millions of Korean won) Book value

Issuer

Interest rate (%)

Acquisition cost 2012 2011

Government and public bonds

Metropolitan Rapid Transit and others 2.50 \ 3,322 \ 4,671 \ 2,239


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Investments in associates

Details of investments in associates as of June 30, 2012 and December 31, 2011, are as follows:

(in millions of Korean won) 2012

Number of shares Ownership

(%) Acquisition cost Net asset

value Book value

HK Mutual Savings Bank 1 4,990,438 20.00 \ 45,719 \ 37,211 \ 49,460

HI Network, Inc. 1 13,332 19.99 76 570 570

Korea Credit Bureau 1 140,000 7.00 3,800 2,892 3,929 Hyundai Capital Germany GmbH2 600,200 30.01 1,065 1,005 1,065

Hyundai Capital UK Ltd.2 1,000,000 29.99 10,850 10,734 10,850

\ 61,510 \ 52,421 \ 65,874

1 The Company’s shareholdings are less than 20%. However, the Group is able to significantly influence

such as involvement in the financial and operating processes, and thus the equity method is applied. 2 The Group’s shareholdings are more than 20%. However, equity method is not applied due to insignificant

fluctuation of equities.


Number of shares Ownership

(%) Acquisition cost Net asset

value Book value

HK Mutual Saving Bank 1 4,990,438 20.00 \ 45,719 \ 33,487 \ 45,735

HI Network, Inc. 1 13,332 19.99 76 1,003 1,003

Korea Credit Bureau 1 140,000 7.00 3,800 2,928 3,965 Hyundai Capital Germany

GmbH2

600,200 30.01 1,065 1,065 1,065

\ 50,660 \ 38,483 \ 51,768

Valuations of investments in associates for the six-month periods ended June 30, 2012 and 2011,

are as follows: (in millions of Korean won)

2012

Beginning Balance Acquisition

Gain on valuation

Changes in accumulated

other comprehensive

loss

Dividends Ending Balance

HK Mutual Savings Bank

\ 45,735 \ - \ 4,139 \ (414) \ - \ 49,460 HI Network, Inc.

1,003 - 300 - (733) 570

Korea Credit Bureau

3,965 - 220 (256) - 3,929 Hyundai Capital Germany

GmbH 1,065 - - - - 1,065

Hyundai Capital UK Ltd.

- 10,850 - - - 10,850

\ 51,768 \ 10,850 \ 4,659 \ (670) \ (733) \ 65,874


15


2011

Beginning Balance

Gain on valuation

Changes in accumulated other

comprehensive loss

Dividends Ending Balance

HK Mutual Savings Bank \ 42,849

\ 4,305 \ 47

\ - \ 47,201

HI Network, Inc. 1,055 193 - (706) 542

Korea Credit Bureau 3,514 251 - - 3,765 Hyundai Capital Germany

GmbH 1,065 - - - 1,065

\ 48,483

\ 4,749 \ 47

\ (706) \ 52,573

Summary of financial information of investees as of June 30, 2012 and December 31, 2011, for

assets and liablities, and for the six-month periods ended June 30, 2012 and 2011, for revenue

and income, are as follows:


2012

Assets Liabilities

Operating revenue Net income

HK Mutual Savings Bank \ 2,584,522 \ 2,398,465 \ 195,441 \ 20,694

HI Network, Inc. 5,586 2,738 8,921 1,619

Korea Credit Bureau 50,082 8,762 22,500 3,649 Hyundai Capital Germany

GmbH 3,846 337 1,171 503

Hyundai Capital UK Ltd. 35,792 - - -


2011

Assets Liabilities

Operating revenue Net income

HK Mutual Savings Bank 1 \ 2,593,289 \ 2,425,855 \ 180,413 \ 21,527

HI Network, Inc. 8,560 3,544 9,854 1,007

Korea Credit Bureau

51,484 9,650 18,066 3,513 Hyundai Capital Germany GmbH 3,889 341 316 58

1 Although HK Mutual Savings Bank’s fiscal year is from July 2010 to June 2011, the asset and liability

amounts are as of December 31, 2011, and its operating revenue and net income amounts are from

January 1, 2011 to June 30, 2011.


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4. Financial receivables

Financial receivables as of June 30, 2012 and December 31, 2011, are as follows:


2012

Principal

Deferred loan origination fees

and costs (Direct profit for leased assets)

Present value discounts

Allowance for doubtful

accounts Carrying

amount

Loans receivable

Loans \ 11,597,275 \ (114,082) \ (1,641) \ (279,331) \ 11,202,221

Installment financial assets Auto 4,469,357 (58,492) - (30,664) 4,380,201 Durable goods 223 - - (11) 212 Mortgage 19,462 39 - (316) 19,185 Machinery 164 - 1 (2) 163

4,489,206 (58,453) 1 (30,993) 4,399,761

Lease receivables Finance lease

receivables 2,544,026 (626) - (25,604) 2,517,796

Cancelled lease receivables 5,868 - - (5,474) 394

2,549,894 (626) - (31,078) 2,518,190

\ 18,636,375 \ (173,161) \ (1,640) \ (341,402) \ 18,120,172

2011

Principal

Deferred loan origination fees

and costs (Direct profit for leased assets)

Present value discounts

Allowance for doubtful

accounts Carrying

amount

Loans receivable

Loans \ 11,239,870 \ (108,782) \ (1,841) \ (281,184) \ 10,848,063

Installment financial assets Auto 5,109,299 (78,757) - (36,748) 4,993,794 Durable goods 1,419 3 - (141) 1,281 Mortgage 25,620 60 - (1,204) 24,476 Machinery 1,674 - 6 (37) 1,643

5,138,012 (78,694) 6 (38,130) 5,021,194

Lease receivables Finance lease

receivables 2,300,204 (703) - (21,118) 2,278,383

Cancelled lease receivables 4,656 - - (4,445) 211

2,304,860 (703) - (25,563) 2,278,594

\ 18,682,742 \ (188,179) \ (1,835) \ (344,877) \ 18,147,851


17

5. Allowance for Doubtful Accounts

Changes in allowance for doubtful accounts for the six-month periods ended June 30, 2012 and

2011, are as follows:


2012

Type Loan

receivables Installment

financial assets Lease

receivables Other assets Total

Beginning balance \ 281,184 \ 38,130 \ 25,563 \ 17,284 \ 362,161

Amounts written off (206,813) (21,432) (15) (3,607) (231,867)

Recoveries of amounts previously written off

43,222 5,288 241 4,150 52,901

Unwinding of discount (3,733) (140) (96) - (3,969) Additional(reversed)

allowance 165,471 9,147 5,385 (296) 179,707

Ending balance \ 279,331 \ 30,993 \ 31,078 \ 17,531 \ 358,933

2011

Type Loan

receivables Installment financial assets Lease

receivables Other assets Total

Beginning balance \ 215,703 \ 28,643 \ 21,031 \ 7,649 \ 273,026

Amounts written off (137,115) (13,816) (11) (2,415) (153,357)

Recoveries of amounts previously written off

48,063 6,726 62 4,010 58,861

Unwinding of discount (3,091) (156) (62) - (3,309) Additional(reversed)

allowance 132,130 8,539 1,458 (2,702) 139,425

Ending balance \ 255,690 \ 29,936 \ 22,478 \ 6,542 \ 314,646


18

6. Financial instruments

The fair values of financial instruments as of June 30, 2012 and December 31, 2011, are as

follows:


Type 2012 2011

Book value Fair value Book value Fair value

Assets

Financial assets

Cash and deposits \ 1,568,283 \ 1,568,283 \ 1,455,442 \ 1,455,442 Available-for-sale

securities 21,479 21,479 18,452 18,452

Loans receivable 11,202,221 11,501,001 10,848,063 11,124,599 Installment financial

assets 4,399,761 4,504,264 5,021,194 5,145,837

Derivative assets 260,964 260,964 475,431 475,431

Other assets 235,804 235,926 234,892 234,810

\ 17,688,512 \ 18,091,917 \ 18,053,474 \ 18,454,571

Liabilities

Financial liabilities

Borrowings \ 2,162,330 \ 2,174,365 \ 2,250,000 \ 2,257,918

Debentures 15,211,314 15,694,138 15,522,368 15,886,881

Derivative liabilities 60,378 60,378 58,096 58,096

Other liabilities 1,248,474 1,255,561 1,183,744 1,190,133

\ 18,682,496 \ 19,184,442 \ 19,014,208 \ 19,393,028

The fair value hierarchy of financial assets and liabilities carried at fair value as of June 30, 2012

and December 31, 2011, are as follows:


2012

Type

Book value

Fair value Fair value hierarchy1

level 1 level 2 level 3

Financial assets Available-for-sale securities \ 21,479 \ 21,479 \ 5,600 \ 4,671 \ 11,208

Derivative assets 260,964 260,964 - 260,964 -

282,443 282,443 5,600 265,635 11,208


Derivative liabilities \ 60,378 \ 60,378 \ - \ 60,378 \ -

1 The levels of fair value hierarchy have been defined as follows:

Level 1: Quoted prices in active markets for identical assets or liabilities. Listed stocks and derivatives


19

Level 2: Inputs for the asset or liability included within valuation techniques that are observable market

data. Most bonds issued in Korean won and foreign currency, general unlisted derivatives like swap,

forward, option

Level 3: Inputs for the asset or the liability that are not based on observable market data. Unlisted stocks,

complicated structured bonds, complicated unlisted derivative


2011

Type

Book value

Fair value Fair value hierarchy1

level 1 level 2 level 3

Financial assets Available-for-sale securities \ 18,452 \ 18,452 \ 5,687 \ 2,239 \ 10,526

Derivative assets 475,431 475,431 - 475,431 -

\ 493,883 \ 493,883 \ 5,687 \ 477,670 \ 10,526


Derivative liabilities \ 58,096 \ 58,096 \ - \ 58,096 \ -

7. Derecognition of financial assets

The Group issued securitized debts based on loans and installment financial assets, and the

associated securitized debts have recourse only to the transferred assets.

Details of financial assets transferred and not derecognized as of June 30, 2012 and December

31, 2011, are as follows:


Type 2012 2011

Book value of assets

Loans receivable \ 1,859,501 \ 2,289,879

Installment assets 1,689,912 1,775,534

3,459,413 4,065,413

Book value of related liabilities1 (2,243,131) (2,748,872)

Liabilities having right of resource on transferred assets :

Fair value of assets 3,639,148 4,167,861

Fair value of related liabilities1 (2,266,653) (2,772,816)

Net position \ 1,372,495 \ 1,395,045 1 Related liabilities are amounts of securitized debts and associated derivative assets.

8. Property and equipment

Changes in property and equipment for the six-month periods ended June 30, 2012 and 2011,

are as follows:


20


2012

Type Beginning

balance Acquisition Replacement Disposal Depreciation Ending balance

Land \ 105,425 \ 38,112 \ - \ - \ - \ 143,537

Buildings 97,939 22,053 - - (2,067) 117,925

Structures 2,558 - - - (35) 2,523

Vehicles 761 2,337 - (44) (384) 2,670 Fixture and furniture

53,770 8,391 893 (347) (10,344) 52,363

Others 1,994 39 - - (4) 2,029 Construction in progress

2,986 2,317 (922) - - 4,381

\ 265,433 \ 73,249 \ (29) \ (391) \ (12,834) \ 325,428

2011

Type

Beginning balance Acquisition Replacement Disposal Depreciation

Ending balance

Land

\ 101,844 \ 1,853 \ - \ - \ - \ 103,697

Buildings 92,543 5,243 - - (1,541) 96,245

Structures 2,246 - - - (31) 2,215

Vehicles 838 166 - (30) (184) 790

Fixture and furniture 35,321 15,956 19 (14) (9,083) 42,199

Others 1,200 496 259 - (4) 1,951

Construction in progress 8,377 2,604 (6,718) - - 4,263

\ 242,369 \ 26,318 \ (6,440) \ (44) \ (10,843) \ 251,360

9. Intangible assets

Changes in intangible assets for the six-month periods ended June 30, 2012 and 2011, are as

follows:


2012

Type Beginning

balance Increase Replacement Amortization Ending balance

Development costs \ 28,635 \ 1,170 \ 31 \ (4,027) \ 25,809

Rights of trademark 30 - - (7) 23

Other intangible assets 36,452 - (2) (966) 35,484

\ 65,117 \ 1,170 \ 29 \ (5,000) \ 61,316


21


2011

Type Beginning

balance Increase Replacement Disposal Amortization Ending balance

Development costs \ 20,004 \ 581 \ 6,440 \ (50) \ (2,992) \ 23,983

Rights of trademark 44 - - - (7) 37

Other intangible assets

32,564 5,328 - (21) (893) 36,978

\ 52,612 \ 5,909 \ 6,440 \ (71) \ (3,892) \ 60,998

10. Borrowings

Changes in borrowings for the six-month periods ended June 30, 2012 and 2011, are as follows:

(in millions of Korean won) Types 2012 2011

Beginning balance \ 17,772,368 \ 17,043,686

Borrowing 3,644,250 4,452,196

Repayment (3,769,732) (3,858,978)

Others (273,241) (249,682)

Ending balance \ 17,373,645 \ 17,387,222

11. Defined benefit liability

The amounts of defined benefit plans recognized in the statements of financial position as of

June 30, 2012 and December 31, 2011, are as follows:


Type 2012 2011

Present value of funded obligations \ 54,641 \ 49,709

Fair value of plan assets1 (29,119) (29,347)

Defined benefit liability \ 25,522 \ 20,362

1 As of June 30, 2012, contribution to the National Pension Fund of \ 42 million is included (December 31,

2011 : \ 45 million).

Details of the amounts recognized in the comprehensive income statements for the six-month

periods ended June 30, 2012 and 2011, are as follows :


Type 2012 2011

Current service cost \ 5,736 \ 4,697

Interest cost 982 885

Expected return on plan assets (572) (525)

Actuarial losses 1,250 1,056


22

\ 7,396 \ 6,113

12. Provisions for unused loan commitments

Changes in provisions for unused loan commitments for the six-month periods ended June 30,

2012 and 2011, are as follows:


Type 2012 2011

Beginning balance \ 10,445 \ 46,624

Reversals (1,190) (33,513)

Ending balance \ 9,255 \ 13,111

13. Derivative financial instruments and hedge accounting

Trading derivatives as of June 30, 2012 and December 31, 2011, are as follows:


2012 2011 Type Assets Liabilities Assets Liabilities

Forward foreign exchange \ 33 \ - \ 53 \ -

During the six-month periods ended June 30, 2012 and 2011, the Group recognized loss on

trading derivatives of \ 19 million and \ 37 million, respectively.

Derivatives designated as cash flow hedges as of June 30, 2012 and December 31, 2011, are as

follows:


Type

2012 2011

Assets Liabilities Notional Principal amounts

Assets Liabilities Notional Principal amounts

Interest rate swaps \ 103 \ 1,477 \ (1,042) \ 12 \ 1,331 \ (1,000)

Currency swaps 260,828 58,901 7,246 475,366 56,765 (49,157)

\ 260,931 \ 60,378 \ 6,204 \ 475,378 \ 58,096 \ (50,157)

The maximum period the Group is exposed to the variability in future cash flows arising from

derivatives designated as cash flow hedges, is expected to be until September 12, 2017.

There is no ineffective portion recognized related to cash flow hedge for the six-month periods

ended June 30, 2012 and 2011.


23

14. Equity

Details of appropriated and expected reserves for bad loans as of June 30, 2012 and December

31, 2011, are as follows:


Type 2012 2011

Appropriated reserve for bad loans \ 270,220 \ -

Expected reserve for bad loans 25,014 270,220

\ 295,234 \ 270,220

Transfer to reserve for bad loans and net income in consideration of effect of changes in reserve

for bad loans for the six-month periods ended June 30, 2012 and 2011, are as follows:

(in millions of Korean won, except per share amounts)

Type 2012 2011

Net income \ 244,340 \ 354,049

Expected transfer to reserve for bad loans1 25,014 (4,848) Net income in consideration of changes in reserve for

bad loans2 219,326

358,897

Net income per share in consideration of changes in reserve for bad loans(In Korean won)2

\ 2,209

\ 3,614

1 The amount transferred to reserve for bad loans for the six-month period ended June 30, 2011, is the

difference between the balance of reserve for bad loans as of June 30, 2011, and the balance as of

December 31, 2010. 2 Net income and earnings per share in consideration of changes in reserve for bad loans are not

accordance with K-IFRS, and these amounts are the sum of the expected transfer to reserve for bad loans

before income tax and net income.

15. Net interest income

Net interest income for the three-month and the six-month periods ended June 30, 2012 and

2011, consists of:


Type 2012

2011

Three months

Six months

Three months

Six months

Interest income

Cash and deposits \ 12,385 \ 24,394

\ 10,350

\ 18,848

Loans receivable

361,022

722,758

378,791

746,382

Installment financial

assets

91,852

192,041

108,070

220,978

Lease receivables1

58,692

115,665

52,567

104,464

Other²

1,387

1,431

124

254


24

525,338

1,056,289

549,902

1,090,926

Interest expenses

Borrowings

25,732

52,716

25,941

51,680

Debentures

188,760

380,421

200,939

399,567

Other²

10,984

21,793

11,120

26,674

225,476

454,930

238,000

477,921

Net interest income \ 299,862 \ 601,359 \ 311,902 \ 613,005

1 Includes amortization of present value discount for lease guarantee.

² Amortization of present value discount using the effective interest method.

16. Net commission income

Net commission income for the three-month and the six-month periods ended June 30, 2012 and

2011, consists of:


Type 2012

2011

Three months Six months Three months Six months

Commission income

Loans receivable \ 11,976 \ 23,651

\ 13,527

\ 26,955

Installment financial assets

1,564

3,200

1,625

3,311

Lease receivables

39,227

75,783

29,517

56,541

52,767

102,634

44,669

86,807

Commission expenses

Lease expenses

4,802

9,060

3,429

6,675

Net Commission Income \ 47,965 \ 93,574 \ 41,240 \ 80,132

17. General and administrative expenses

General and administrative expenses for the three-month and the six-month periods ended June

30, 2012 and 2011, are as follows:


Type 2012

2011

Three months Six months Three months Six months

Payroll \ 31,344 \ 59,313

\ 25,888

\ 52,097

Severance benefits

4,706

7,517

3,597

6,119

Fringe benefits

8,605

19,157

7,790

16,524

Depreciation

6,629

12,834

5,604

10,843

Advertising

13,857

24,399

9,068

18,150

Travel and transportation

1,660

2,922

1,055

2,026

Communication

3,544

7,187

3,180

6,461

Water, lighting and heating

2,897

5,414

2,110

4,390


25

Commission

4,864

8,919

4,866

8,576

Sales commission

15,741

29,911

14,088

38,841

Amortization

2,472

5,000

2,035

3,892

Outsourcing service charges

17,782

33,220

16,585

32,499

Rent

9,599

18,429

9,630

17,927

Other expenses

23,739

49,365

22,495

42,832

\ 147,439 \ 283,587 \ 127,991 \ 261,177

18. Income Tax

Income tax expense is recognized based on management’s best estimate of the weighted average annual income tax rate expected for the full financial year. The estimated average annual tax rate used for the year ended December 31, 2012, is 27% (the estimated average annual tax rate for the period ended June 30, 2011, is 23%).

19. Earnings per share

Basic earnings per share attributable to common stock for the three-month and the six-month

periods ended June 30, 2012 and 2011, is as follows:

Type 2012

2011

Three months Six months Three months Six months (1) Net income attributable

to common stock (In Korean won)

\ 115,269,826,053 \ 244,340,097,651

\ 208,924,894,050

\ 354,048,916,718

(2) Weighted average of number of outstanding common shares

99,307,435

99,307,435

99,307,435

99,307,435

(3) Basic earnings per share (In Korean won) (1)÷(2)

\ 1,161 \ 2,460 \ 2,104 \ 3,565

b. Diluted earnings per share

As there was no discontinued operation during the three-month and the six-month periods ended

June 30, 2012 and 2011, basic earnings per share is the same as basic earnings per share from

continuing operations. There are no potential common stocks as of June 30, 2012 and 2011.

Therefore, the diluted earnings per share is the same as basic earnings per share for the three-

month and the six-month periods ended June 30, 2012 and 2011.

20. Other comprehensive income

Other comprehensive income for the six-month periods ended June 30, 2012 and 2011, consists

of:


26


Type

Beginning balance

Changes

Income tax effects Ending

balance

Reclassifi-cation of profit or

loss

Other changes

Gain(loss) on valuation of available-for-sale financial assets

\ (388) \ - \ 720 \ (133) \ 199

Accumulated comprehensive income of equity method investees

47 - (670) - (623)

Gain(loss) on valuation of derivatives

(50,157) 419 63,845 (7,903) 6,204

Loss on exchange differences of foreign operations

(343) - (443) - (786)

\ (50,841) \ 419 \ 63,452 \ (8,036) \ 4,994


Type

Beginning balance

Changes

Income tax effects Ending

balance

Reclassifi-cation of profit or

loss

Other changes

Gain(loss) on valuation of available-for-sale financial assets

\ 512 \ (661) \ 140 \ 114 \ 105

Accumulated comprehensive income of equity method investees

24 - 47 (62) 9

Gain(loss) on valuation of derivatives

(67,924) 5,919 29,833 (8,143) (40,315)

Gain(loss) on exchange differences of foreign operations

17 - (176) - (159)

\ (67,371) \ 5,258 \ 29,844 \ (8,091) \ (40,360)

21. Supplemental cash flow information

Cash and cash equivalents in cash flow statements consist of cash in hand, deposits and short-

term money-market instruments.

Cash and cash equivalents consisting of cash and financial instruments as of June 30, 2012 and

December 31, 2011, are as follows:


Type 2012 2011

Cash \ 1 \ 4

Ordinary deposits 134,135 135,706


27

Current deposits 3,438 1,923

Short-term financial instruments 1,430,700 1,317,800

\ 1,568,274 \ 1,455,433

Cash generated from operations for the six-month periods ended June 30, 2012 and 2011, is as

follows: (in millions of Korean won)

Type 2012 2011

Net income \ 244,340 \ 354,049

Adjustments

Net interest expenses 429,105 458,819

Income tax 90,296 108,503 Gain on disposal of available-for-sale financial assets

(1,776) (2,084)

Income on loans (17,864) (21,784)

Income on installment financial receivables (37,664) (48,436)

Gain on leases (636) (609)

Gain on foreign exchanges translation (66,990) (244,804)

Dividend income (2,831) (3,251)

Gain on valuation of derivatives (15,961) (73,016)

Gain on disposal of property and equipment (30) (6)

Reversal of provisions (1,190) (33,513)

Gain on equity method valuation (4,659) (4,749)

Lease expenses 169,634 187,616

Bad debts expense 179,707 139,425

Loss on foreign exchanges translation 15,968 73,024

Severance benefits 7,396 6,113

Depreciation 12,834 10,843

Amortization of intangible assets 5,000 3,892

Loss on valuation of derivatives 66,989 244,820

Loss on disposal of property and equipment 364 -

Loss on bond retirement - 16

827,692 800,819

Changes in operating assets and liabilities (Increase) in available-for-sale financial

Assets (531) 1,543

(Increase) in loans receivable (545,005) (792,990) Decrease in installment financial assets 644,662 162,753 (Increase) in finance lease receivables (400,835) (437,084)

Decrease in cancelled leased receivables 4,853 3,710

(Increase) in operating leased assets (154,963) (76,644)

Decrease in cancelled leased assets 151,918 111,970

Increase in allowance for doubtful accounts 52,923 58,860

(Increase) in non-trade receivables (21,487) (34)

Decrease in accrued revenues 8,287 4,306

Increase in advance payments (46,752) (590)


28

(Increase) in prepaid expenses (9,509) (7,442)

Decrease(increase) in derivative assets (12,822) 21,192

Increase in non-trade payables 35,161 7,288

(Decrease) in accrued expenses (62) (277)

(Decrease) in unearned revenue (2,750) (3,976)

Increase in withholdings 4,533 4,943

(Decrease) in leasehold deposits received (6,727) (11,068)

Payment of severance benefits (3,333) (2,923)

Decrease(increase) in plan assets 734 (1,884)

Transfer of severance benefits from related parties 866 1,405

Transfer of severance benefits to related parties (504) (1,193)

Increase in derivative liabilities 12,842 (14,789)

(288,501) (972,924)

\ 783,531 \ 181,944

22. Commitments and Contingencies

a. Credit Line Agreement

Details of unused credit line agreements of the Group as of June 30, 2012 and December 31,

2011, are as follows:


Type Financial institutions 2012 2011

Limit of overdraft Shinhan Bank and 2 other banks \ 41,500 \ 41,500

Limit of daily loan SC Bank and 2 other banks 45,000 45,000

\ 86,500 \ 86,500

b. Credit Facility Agreement

The Group has revolving credit facility agreements with several financial institutions as of June

30, 2012 and December 31, 2011. Details of credit facility agreements are as follows:


Financial institutions 2012 2011

GE Capital European Funding & Co1

Equivalent of

USD 1 billion in

Euros

Equivalent of

USD 1 billion in

Euros Mizuho Corporate Bank, Seoul Branch \ 65,000 \ 65,000 JPMorgan, Seoul Branch 110,000 80,000 Citibank, Seoul 50,000 50,000 Standard Chartered, Seoul Branch 50,000 50,000


29

Societe Generale, Seoul Branch 55,000 55,000 Bank of China, Seoul 30,000 30,000 DBS Bank, Seoul 100,000 50,000 Credit Agricole, Seoul 100,000 26,000 RBS, Seoul 110,000 110,000 ING Bank, Seoul 100,000 100,000

KDB Bank 30,000 30,000

Kyobo Life Insurance Co., Ltd 50,000 50,000

Kookmin Bank 200,000 -

CITIBANK, N.A. USD 200 million USD 200 million The Bank of TOKYO MITSUBISHI UFJ.,

Ltd USD 200 million USD 200 million

1 Relative to the above credit facility agreement, Hyundai Motor Company shall pay GE Capital

European Funding & Co. any amount not paid by the Company, at such time multiplied by the

shareholding ratio of Hyundai Motor Company.

There has been no usage of the above credit facility agreements as of June 30, 2012 and

December 31, 2011.

c. Guarantees

Details of guarantees involving third parties as of June 30, 2012 and December 31, 2011, are as

follows:


Guarantor Details 2012 2011

Hyundai Motor

Company

Joint liabilities on finance lease

receivables1

\ 15 \ 216

Hyundai Wia Joint liabilities on machinery installment financing receivables1

164 1,674

Seoul Guarantee Insurance Co., Ltd.

Guarantee for debt collection deposit, others

163,702 186,062

1 The amounts represent the guaranteed balances as of June 30, 2012 and December 31, 2011, as defined

under the joint liability agreement.

The Group carries residual value guarantee insurance with Hyundai Marine & Fire Insurance Co.,

Ltd. against loss in case unredeemed mortgage loans exceed the recoverable amount from the

collateral of the loans. The receivables balance carried insurance and residual value guaranteed

by the insurance as of June 30, 2012 and December 31, 2011, are as follows:


Type 2012 2011

Receivables balance \ 833,673 \ 865,834 The amount of residual value guaranteed by insurance

314,090 284,470


30

d. Pending significant litigations

Details of pending significant litigations involving the Group as of June 30, 2012, are as follows:

(in millions of Korean won) Type Number of litigations Amount of litigations

Plaintiff 7 \ 245

Defendant 16 1,627

In addition, the Group has filed lawsuits against a number of debtors to collect receivables. As of

report date, the outcome of these cases cannot be reasonably determined and no adjustments

are reflected on the consolidated financial statements of the Group as of June 30, 2012. 23. Related Party Transactions

a. Relationships between parents and subsidiaries

The parent company is Hyundai Motor Company. Related parties include associates, joint

ventures, post-employment benefit plans, members of key management personnel and entities

which the Group controls directly or indirectly, has joint control or significant influence over them.

b. Transaction between related parties

Significant transactions, which occurred in the normal course of business with related companies

for the six-month periods ended June 30, 2012 and 2011, are as follows:


Type 2012 2011 Purchases Disposal Purchases Disposal

Parent Company Hyundai Motor Company \ 443,139 \ - \ 503,170 \ -

Others

Kia Motors Corp. 163,028 - 118,152 -

Autoever Systems Corp. 5,651 - 666 -

Glovis Co., Ltd. - 28,563 - 35,720

Hyundai Card Co., Ltd. 82,862 - 61,859 - Hyundai Commercial Co., Ltd.

19,099 - 10,729 -

270,640 28,563 191,406 35,720

\ 713,779 \ 28,563 \ 694,576 \ 35,720


31

Revenue and expenses arising from transactions with related parties for the three-month and the

six-month periods ended June 30, 2012 and 2011, and receivables and payables as of June 30,

2012 and December 31, 2011, are as follows:


Type 2012

2011

Revenues Expenses

Revenues Expenses

Three

months

Six

months

Three

months

Six

months

Three

months

Six

months

Three

months

Six

months

Parent Company

Hyundai Motor Company

\ 922 \ 2,194

\ 686

\ 1,560

\ 4,964

\ 10,168 \ 291 \ 1,155

Others

Kia Motors Corp.

12

12

2,536

4,986

- - 1,151 1,284

Hyundai Card Co., Ltd.

9,368

20,764

15,097

22,258

5,775

12,005 3,946 6,358 Hyundai Commercial Co., Ltd

356

1,031

219

773

263 490 164 273

Other related parties

1,946

3,460

6,889

15,479

1,453 2,387 9,309 17,572

11,682

25,267

24,741

43,496

7,491

14,882 14,570 25,487

\ 12,604

\ 27,461

\ 25,427

\ 45,056

\ 12,455 \ 25,050 \ 14,861 \ 26,642


2012

2011

Receivables Payables Receivables Payables

Parent Company

Hyundai Motor Company \ 4,486 \ 4,882

\ 3,924

\ 7,279

Others

Kia Motors Corp.

114

59,080

19,431

17,867 Hyundai Card Co., Ltd.

488

136,291

1,165

137,262

Hyundai Commercial Co., Ltd

262

48

46

4,268 Other related parties

36,261

576

12,844

-

37,125

195,995

33,486

159,397

\ 41,611 \ 200,877 \ 37,410 \ 166,676

The Group has been provided with a credit facility and payment guarantees by GE Capital

European Funding & Co and Hyundai Motor Company, respectively(Note 22).

c. Key management compensation

Compensation to key management for the six-month periods ended June 30, 2012 and 2011,

consist of:

Type 2012 2011

Short-term employee benefits \ 1,536 \ 3,824

Severance benefits 1,186 1,206

The key management above consists of directors (including nonpermanent directors), who have

significant authority and responsibilities for planning, operating and controlling the Group.


32

24. Financial risk management

The Group is exposed to credit risk, liquidity risk and market risk (exchange and rate risk). In

order to manage these factors, the Group operates risk management policies and programs that

monitor closely and respond to each of the risk factors. The Group uses derivatives to manage

specific risks.

As interim consolidated financial statements does not include all the financial risk management

and disclosures that are required in annual consolidated financial statements, please refer to

annual consolidated financial statements as of December 31, 2012.

There was no significant change in the Group's risk management division and policies after

December 31, 2011

25. Event after the reporting period

The Group acquired 100% of the share capital of GE capital Korea Co., Ltd on July 3, 2012, in

accordance with Board of Directors’ resolution on October 21, 2011. The amounts of

consideration transferred, acquired assets and assumed liabilities, at the acquisition date are

provisional and it will be determined according to the result of final valuation.

Investor Relations

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