Siebert Financial's Business Segments

Siebert Financial Corp. is a holding company that conducts its retail discount brokerage business through its wholly-owned subsidiary, Muriel Siebert & Co., Inc., (“MSCO”) a Delaware corporation. In addition, in 2014 we began business as a registered investment advisor through our wholly-owned subsidiary, Siebert Investment Advisors, Inc. (“SIA”) The estate of Muriel F. Siebert, our former Chairwoman, Chief Executive Officer and President, owns approximately 90% of our outstanding common stock, par value $.01 per share (the “Common Stock”).

Our principal offices are located at 885 Third Avenue, New York, New York 10022, and our phone number is (212) 644-2400.

Siebert’s principal activity is providing online and traditional discount brokerage and related services to retail investors. On November 4, 2014, the Company sold its capital market business to an affiliate, Siebert Brandford Shank Financial, LLC (“SBSF”) and on November 9, 2015, sold its 49% membership interest in SBSF.

The Retail Division

Overview:
The Retail Division of Siebert operates as a leading discount brokerage firm that has been serving retail investors since its inception as a discount broker on May 1, 1975. Siebert established itself among the pioneers of discount brokerage, being one of the longest-standing firms to hold membership in The New York Stock Exchange (NYSE). With the introduction of SiebertNet in 1998, the company provided users with online access to their investment accounts, enhancing the convenience and flexibility of trading.

Segments and Product Offerings:

1. Discount Brokerage and Related Services:
- Traditional and Digital Brokerage:
Siebert offers a range of trading options tailored for retail clients, allowing them to engage in trading via a broker over the telephone, through mobile devices, or online at significantly lower commission rates than full-service brokers.
- Account Access:
Customers benefit from a platform that enables real-time account access through SiebertNet, along with mobile applications and interactive voice recognition systems for 24/7 service.

2. Independent Retail Execution Services:
- Order Flow Monitoring:
Siebert collaborates with National Financial Services Corp. (NFS) to monitor order flow, ensuring optimal trade execution.
- ECN Access:
Customers have the opportunity to utilize various electronic communication networks (ECNs) for executing trades, accessible before and after market hours.

3. Fixed Income Trading:
- Investors can express interest in buying or selling fixed income securities, such as municipal and corporate bonds, or certificates of deposit, which are supported by registered representatives.

4. Customer Service:
- Dedicated Support:
Siebert prioritizes customer service with dedicated personnel available via toll-free access. Each branch office provides personalized assistance, ensuring that clients receive comprehensive support across different types of inquiries.
- Customer Relationship Management (CRM):
A proprietary CRM system enables seamless tracking and management of customer interactions, enhancing responsiveness and service efficiency.

5. Retirement Accounts:
- Siebert provides a comprehensive range of self-directed retirement accounts, including IRAs, SEP IRAs, ROTH IRAs, and 401(k)s. Custodial services for these accounts are managed through an affiliate of NFS, facilitating investment in stocks, bonds, and mutual funds within a consolidated account framework.

6. Customer Financing:
- Margin Accounts:
Siebert facilitates margin accounts that allow customers to borrow against their securities for trading leverage. The firm monitors equity requirements closely and ensures risk management practices are in place to mitigate potential losses due to market fluctuations.
- Short Selling:
Customers are given the option to sell securities short, allowing for trading strategies that may benefit from price declines.

Information and Communications Systems:
- Technology Infrastructure:
Siebert relies on an advanced technology platform provided by NFS to maintain customer account records and manage trading operations. This infrastructure includes browser-based access, risk management tools, and integrated functional systems for trade entry and reporting.
- Branch Connectivity:
The firms branches are interconnected using a secure virtual private network, allowing efficient operation and information sharing.

8. Advanced Trading Features:
- The Siebert trading platform includes comprehensive functionalities designed for active traders, including:
- Informative Trading Screens: Real-time quotes, order status, and detailed performance charts.
- Multiple Orders: Customers can place multiple orders simultaneously, increasing trading efficiency.
- Tax-Lot Trading: Customers can manage tax implications by specifying tax lots when executing trades.
- Trailing Stop Orders: Automated orders that adjust with the market price to protect against losses.
- Contingent Orders: Comprehensive order types such as One-Triggers-Two and One-Cancels-Other for greater control over trading strategies.

The Capital Markets Division

Overview:
The Capital Markets Division of Siebert, known as Siebert’s Capital Markets Group (SCM), focuses on investment banking and institutional equity execution services. The group has a rich history of involvement in securities offerings for various corporations and federal agencies.

Product and Service Offerings:

1. Investment Banking Services:
- The SCM division specializes in assisting corporations and government entities in raising capital. This service includes underwriting and syndication support during the issuance of both equity and fixed-income securities.

2. Institutional Equity Execution:
- Siebert provides high-quality brokerage services tailored for institutional investors, ensuring effective execution and management of equity transactions.

3. Partnerships and Asset Management:
- Creation of Siebert Brandford Shank Financial, L.L.C. (SBSF):
In November 2014, the company refocused its capital markets operations by contributing its SCM membership interests into SBSF, which is involved in the management of post-closing liabilities relating to the transferred business along with experienced partners in the field.

4. Purchase Agreements and Financial Arrangements:
- The Purchase Agreement with SBSF included structured payments based on net income generated from the capital markets business. This arrangement emphasizes Sieberts strategic focus on sustainable income generation and long-term partnerships.

Overall, Siebert combines a dedicated approach to retail brokerage with a robust capital markets division, ensuring comprehensive service offerings that cater to both retail investors and institutional clients. The companys emphasis on technology, customer service, and innovative trading solutions continues to reinforce its competitive positioning in the financial services industry.