UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement
[ ] Confidential For Use of the Commission Only
(as Permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Materials Pursuant to Section 240.14a-12

SANTA FE FINANCIAL CORPORATION
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(Name of Registrant as Specified in Its Charter)

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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

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SANTA FE FINANCIAL CORPORATION
820 MORAGA DRIVE10940 WILSHIRE BLVD., SUITE 2150
LOS ANGELES, CALIFORNIA 9004990024

(310) 889-2500

---------------------------

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 21, 200824, 2011

To The Shareholders of Santa Fe Financial Corporation:

NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Santa Fe
Financial Corporation ("Santa Fe" or the "Company") will be held on February
21, 200824, 2011 at 10:30 A.M. at the Hilton San Francisco Financial District, 750
Kearny Street, San Francisco, CA 94108 for the purpose of considering and
acting on the following:

1.(1) To elect three Directors to serve until the next Annual Meeting or
until their successors have been duly elected and qualified.

2.(2) To ratify the Audit Committee's appointment of Burr Pilger & Mayer,
LLPInc. as the Company's independent registered public accounting firm
for the fiscal year ending June 30, 2008;2011;

(3) To approve, in a non-binding vote, the compensation of our named
executive officers;

(4) To determine, in a non-binding vote, whether a shareholder vote to
approve our named executive officer compensation should occur every
one, two or three years; and

3.(5) To consider and act upon any other matters that may properly come
before the meeting or any adjournments thereof.

The Board of Directors has fixed the close of business on January 10, 2008`11, 2011 as
the record date for determining the shareholders having the right to vote at
the meeting or any adjournments thereof.

Your proxy is important to us whether you own a few or many shares. Please
complete, sign, date and promptly return the enclosed proxy in the self-
addressed, postage-paid envelope provided. Return the proxy even if you plan
to attend the meeting. You may always revoke your proxy and vote in person.

Dated: January 18, 200821, 2011

By Order of the Board of Directors,

/s/ Michael G. Zybala

Michael G. Zybala
Secretary

_____________________________________________________________________________

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON FEBRUARY 24, 2011. THE COMPANY'S
PROXY STATEMENT AND ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED
JUNE 30, 2010 ARE ALSO AVAILABLE ON SANTA FE FINANCIAL CORPORATION'S PARENT
COMPANY'S WEBSITE AT WWW.INTERGROUPCORPORATION.COM.

SANTA FE FINANCIAL CORPORATION
820 MORAGA DRIVE10940 WILSHIRE BLVD., SUITE 2150
LOS ANGELES, CALIFORNIA 9004990024
(310) 889-2500

----------------------------
PROXY STATEMENT
----------------------------

ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD FEBRUARY 21, 200824, 2011

The Board of Directors of Santa Fe Financial Corporation (the "Company" or
"Santa Fe") is soliciting proxies in the form enclosed with this statement in
connection with the Annual Meeting of Shareholders to be held on February 21,
200824,
2011 or at any adjournment or adjournments thereof.

This Proxy Statement and the accompanying Proxy are first being sent to
Shareholders on or about January 25, 2008.24, 2011. Only shareholders of record at the
close of business on January 10, 200811, 2011 are entitled to notice of, and to vote
at, the Annual Meeting.

If you give us a proxy, you can revoke it at any time before it is used. To
revoke it, you may file a written notice revoking it with the Secretary of
the Company, execute a proxy with a later date or attend the meeting and vote
in person.

You may vote at the Annual Meeting only shares that you owned of record on
January 10, 2008.11, 2011. There were 1,241,810 shares of common stock outstanding on
that date. A majority, or 620,906 shares will constitute a quorum for the
transaction of business at the meeting. Each share is entitled to one vote
on each matter to be presented at the meeting. Unless cumulative voting is
elected as described under "Election of Directors" below, theThe affirmative vote of the
holders of the majority of the shares of the Company's stock present or
represented at the meeting and entitled to vote is required to elect
directors and ratify or approve the other itemproposals being voted on at this
time.

In addition to mailing this material to shareholders, the Company has asked
banks and brokers to forward copies to persons for whom they hold stock of
the Company and to request authority for the execution of proxies. The
Company will reimburse banks and brokers for their reasonable out-of-pocket
expenses in doing so. Officers of the Company may, without being additionally
compensated, solicit proxies by mail, telephone, telegram or personal
contact. All proxy soliciting expenses will be paid by the Company. The
Company does not expect to employ anyone else to assist in the solicitation
of proxies.
1

PROPOSAL 1

ELECTION OF DIRECTORS

The Company's bylaws set the number of directors at three. We propose to
elect three directors, each to hold office until the next Annual Meeting of
Shareholders and until his or her successor is elected and qualified. The
Board of Directors has nominated John V. Winfield, John C. Love and William
J. Nance. The persons named in the enclosed form of proxy will vote it for the
election of the nominees listed below unless you instruct otherwise, or a
nominee is unable or unwilling to serve. The Board of Directors has no
reason to believe that any nominee will be unavailable. However, in that
event, the proxy may vote for another candidate or candidates nominated by
the Board of Directors. The California Corporations Code, as applicable to the Company, provides that
a shareholder may cumulate votes if a shareholder gives notice, prior to the
voting, of an intention to cumulate votes. If such a notice is given, every
shareholder may cumulate votes. Cumulating votes means that you can take the
total number of votes you have for all directors and distribute them among
one or more nominees as you see fit. For example, assume you have 100
shares. We have three directors so you have a total of 3 x 100 = 300 votes.
You could give all 300 votes to one person or 150 votes to each of two
nominees, or 100 votes to each of three nominees. You can use this power
only under the circumstances described herein. If cumulative voting is
elected, the enclosed form of proxy gives the proxy discretion to cumulate
votes so that he can elect the maximum possible number of the nominees
identified below.

Any shareholder executing the enclosed form of proxy
may withhold authority to vote for any one or more nominee by so indicating
in the manner described in the form of proxy. However, the number of votes authorized by the form of
proxy will not be affected and the named proxies could probably offset any
such action by using cumulative voting if they thought it necessary. Under
the California Corporations Code any shareholder or any person who claims to
have been denied the right to vote may apply to a state superior court for a
determination of the validity of any election or appointment of any director.

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth certain information with respect to the
Directors and Executive Officers of the Company. There is no relationship by
blood, marriage or adoption among the Directors and Officers. All Directors
serve one year terms with their terms expiring at the Annual Meeting. All
Officers of the Company are elected or appointed by the Board of Directors
and hold office until the Annual Meeting or until replaced at the discretion
of the Board.

Shares of
Common Stock
Beneficially
Owned on Percent
Position Director January 10,11, of
Name Age With the Company Since 20082011 Class(1)
- --------------------------------------------------------------------------------------------

John V. Winfield 6164 Chairman, President 1995 985,859(2) 79.4%993,779(2) 80.0%
and Chief Executive
Officer

William J. Nance 6366 Director 1996 0(3) 0.0%

John C. Love 6770 Director 1998 0(3) 0.0%

Michael G. Zybala 5558 Vice President, N/A 0 0.0%
Secretary and
General Counsel

David T. Nguyen 3437 Treasurer and N/A 0 0.0%
Controller
All of the above as a group 985,859 79.4%993,779 80.0%
- ---------------------------

(1) Based on 1,241,810 shares of common stock issued and outstanding as of
January 10, 2008.11, 2011.

(2) John V. Winfield is the sole beneficial owner of 49,400 shares of common
stock. The InterGroup Corporation ("InterGroup") is the beneficial owner
of 936,459944,379 shares of common stock. As the President, Chairman of the
2
Board and a 62.6%60.2% shareholder of InterGroup, Mr. Winfield has voting and
dispositive power with respect to the shares of Santa Fe owned of record
and beneficially by InterGroup.

(3) William J. Nance is a 3.3%2.4% beneficial shareholder of InterGroup as well
as a Director thereof. John C. Love is also a Director of InterGroup
and a 1.2%0.9% beneficial shareholder of InterGroup.

Security Ownership of Management in Subsidiary

As of January 10, 2008,11 2011, Santa Fe was the record and beneficial owner of
505,437 shares of the common stock of Portsmouth Square, Inc. (Portsmouth")
and Santa Fe's parent company, InterGroup was the record owner of 80,50086,000
shares of Portsmouth, representing approximately 79.8%80.5% of the outstanding

common shares of Portsmouth. The President and Chairman of the Board of Santa
Fe and InterGroup has voting power with respect to common shares of
Portsmouth owned by Santa Fe and InterGroup. No other director or executive
officer of Santa Fe has a beneficial interest in Portsmouth's shares.

Business Experience:

The principal occupation and business experience during the last five years
for each of the Directors and Executive Officers of the Company are as
follows:

John V. Winfield -- Mr. Winfield was first elected to the Board in May of
1995 and currently serves as the Company's Chairman of the Board, President
and Chief Executive Officer, having been appointed as such in April 1996.
Mr. Winfield is also the Chairman of the Board, President and Chief Executive
Officer of the Company's subsidiary, Portsmouth, having held those positions
since May of 1996. Mr. Winfield is Chairman of the Board, President and
Chief Executive Officer of The InterGroup Corporation ("InterGroup"), a
public company, and has held those positions since 1987. Mr. Winfield's
extensive experience as an entrepreneur and investor, as well as his
managerial and leadership experience from serving as a chief executive
officer and director of public companies, led to the Board's conclusion that
he should serve as a director of the Company.

William J. Nance -- Mr. Nance was first elected to the Board in May of 1996.
Mr. Nance is also a director of Portsmouth. Mr. Nance is the President and
CEO of Century Plaza Printers, Inc., a company he founded in 1979. He has
also served as a consultant in the acquisition and disposition of multi-
family and commercial real estate. Mr. Nance is a Certified Public
Accountant and, from 1970 to 1976, was employed by Kenneth LeventholLeventhal &
Company where he was a Senior Accountant specializing in the area of REITS
and restructuring of real estate companies, mergers and acquisitions, and all
phases of real estate development and financing. Mr. Nance is aalso Director
of InterGroup, a public company, and has held such position since 1984. Mr.
Nance also serves as a director and Chairman of the Board of Comstock Mining,
Inc. (formerly Goldspring, Inc.), a public company. Mr. Nance's extensive
experience as a CPA and in numerous phases of the real estate industry, his
business and management experience gained in running his own businesses, his
service as a director and audit committee member for other public companies
and his knowledge and understanding of finance and financial reporting, led
to the Board's conclusion that he should serve as a director of the Company.

John C. Love -- Mr. Love was appointed a Director of the Company on March 5,
1998. Mr. Love is an international hospitality and tourism consultant and a
hotel broker.consultant. He is
a retired partner in the national CPA and consulting firm of PannelPannell Kerr
Forster. Mr. Love has extensive experienceForster and, for the last 30 years, a lecturer in hotel
development, acquisitionhospitality industry
management control systems and development.competition & strategy at Golden Gate
University and San Francisco State University. He is chairman emeritusChairman Emeritus of the
Board of Trustees of Golden Gate University in San Francisco.and the Executive Secretary of
the Hotel and Restaurant Foundation. Mr. Love is also a Director of
Portsmouth, having first been appointed in March 1998 and a Director of
InterGroup, having first been appointed in January 1998. Mr. Love's extensive
experience as a CPA and in the hospitality industry, including teaching at
the university level for the last 30 years in management control systems, and
his knowledge and understanding of finance and financial reporting, led to
the Board's conclusion that he should serve as a director of the Company.

Michael G. Zybala -- Mr. Zybala was appointed as Vice President and Secretary
of the Company on February 20, 1998. He is also Vice President, Secretary
and General Counsel of Portsmouth. Mr. Zybala is an attorney at law and has
served as the Company's General Counsel since 1995 and has represented the
Company as its corporate counsel since August 1993.1978. Mr. Zybala also serves as
Assistant Secretary and counsel to InterGroup.InterGroup and has held those positions
since January 1999.

David T. Nguyen --- Mr. Nguyen was appointed as Treasurer of the Company on
February 27, 2003. Mr. Nguyen also serves as Treasurer of InterGroup and
Portsmouth, having been appointed to those positions on February 26, 2003 and
February 27, 2003, respectively. Mr. Nguyen is a Certified Public Accountant
and, from 1995 to 1999, was employed by PricewaterhouseCoopers LLP where he
was a Senior Accountant specializing in real estate. Mr. Nguyen has also
served as the Company's Controller from 1999 to December 2001 and from
December 2002 to present.

BOARD AND COMMITTEE INFORMATION

Board of Directors:

Santa Fe is an unlisted company and a small business issuerSmaller Reporting Company under the rules
and regulations of the Securities and Exchange Commission ("SEC"). The
majority of its Board of Directors consists of "independent" directors as
independence is defined by the applicable rules and regulations of the SEC
and the National
Association of Securities Dealers' ("NASD").NASDAQ. The Board of Directors held four meetings during the 20072010 Fiscal
Year (in person, telephonically or by written consent). No Director attended
(whether in person, telephonically, or by written consent) less than 75% of
all meetings held during the period of time he or she served as Director
during the 20072010 Fiscal Year.

The Board of Directors has not established a formal process for security
holders to send communications to the Board of Directors and the Board has
not deemed it necessary to establish such a procedure at this time.
Historically, almost all communications that the Company receives from
security holders are administrative in nature and are not directed to the
Board of Directors. If the Company should receive a security holder
communication directed to the Board of Directors, or to an individual
director, said communication will be relayed to the Board of Directors or the
individual director as the case may be.

The Company does not have any formal policy with regard to board members
attendance at annual meetings of shareholders but encourages each director to
attend said meetings. All of the Company's directors attended the fiscal 20062009
annual meeting of shareholders.

Committees:

Santa Fe has established two standing committees, a Securities Investment
Committee and an Audit Committee. The Company does not have any standing
nominating or compensation committees of the Board of Directors. Executive
compensation is determined by the independent members of the Board. New
director nominations, if any, will be considered and determined by the Board
of Directors. The Company has no policy with regard to consideration of any
director candidates recommended by security holders. As a small business
issuer that has more than 79%approximately 80.0% of its voting securities controlled by
one shareholder, the Company has not deemed it appropriate to institute such
a policy.

On March 17, 1998, the Company established a Securities Investment Committee
to establish guidelines and to review the Company's investment policies. The
Committee consists of all the members of the Board, with Mr. Winfield serving
as Chairperson. During fiscal 2007,2010, the Securities Investment Committee held
fourthree meetings, in person, telephonically or by written consent with, all
members attending each meeting.

Santa Fe is an unlisted company and small business issuera Smaller Reporting Company under SEC
rules. The Company's Audit Committee is currently comprised of Messrs. Nance
(Chairperson) and Love, each of whom are independent directors as
independence is defined by the applicable rules and regulations of the SEC
and the NASD,NASDAQ, and as may be modified or supplemented. Each of these directors
also meets the audit committee financial expert test. The primary function
of the Audit Committee is to assist the Board of Directors in fulfilling its
oversight responsibilities by reviewing: the financial reports provided by
the Company to any governmental body or the public; the Company's system of
internal controls regarding finance, accounting, legal compliance and ethics
that management and the Board have established; and the Company's auditing,
accounting and financial processes generally. The Audit Committee is
responsible for the selection and retention of the Company's independent
auditors.registered public accounting firm. The Audit Committee held sixfive meetings
during the 20072010 Fiscal Year. The Company's Board of Directors has adopted a
written charter for the Audit Committee. A copy of that written charter, as
amended, is attached as Appendix A to this proxy statement.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and each beneficial owner of more than ten percent of
the Common Stock of the Company, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission. Officers, directors
and greater than ten-percent shareholders are required by SEC regulations to
furnish the Company with copies of all Section 16(a) forms they file. 4
Based
solely on its review of the copies of such forms received by the Company, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that during fiscal 20072010 all
filing requirements applicable to its officers, directors, and greater than
ten-percent beneficial owners were complied with.

4
EXECUTIVE COMPENSATION

As a small business issuer,Smaller Reporting Company, Santa Fe has no compensation committee.
Executive Officer compensation is set by independent members of the Board of
Directors. The Board seeks to design and set compensation to attract and
retain highly qualified executive officers and to align their interests with
those of long-term owners of the Company. The Board has not engaged any
compensation consultants in determining the amount or form of executive or
director compensation, but does review and monitor published compensation
surveys and studies. The Board may delegate to the Company's Chief Executive
Officer the authority determine the compensation of certain executive
officers.

The following table provides certain summary information concerning
compensation awarded to, earned by, or paid to the Company's principal
executive officer and other named executive officers of the Company whose
total compensation exceeded $100,000 for all services rendered to the Company
for each of the Company's last two competed fiscal years ended June 30, 20072010
and 2006.2009. No stock awards, long-term compensation, options or stock
appreciation rights were granted to any of the named executive officers
during the last two fiscal years.

SUMMARY COMPENSATION TABLE

Fiscal All Other
Name and Principal Position Year Salary Bonus Compensation Total
- --------------------------- ---- ---------- ---------- ------------ ------------

John V. Winfield 20072010 $267,000(1) $ - $42,500(2) $ 309,500
Chairman, President and 20062009 $267,000(1) $ - $42,500(2) $ 309,500
Chief Executive Officer

Michael G. Zybala 2007 $135,000(3) $2010 $123,750(3) - - $ - $ 135,000123,750
Vice President, Secretary 2006 $ 85,500(3) $2009 $111,000(3) - - $ - $ 85,500111,000
and General Counsel

David T. Nguyen 2010 $ 90,000(4) - - $ 90,000
Treasurer and Controller 2009 $ 90,000(4) - - $ 90,000
- ---------------------------

(1) Includes salary and director's fees received from the Company's
subsidiary, Portsmouth, in the amounts of $133,000 for each of the fiscal
years ended June 30, 20072010 and 20062009 and directors fees in the amount of $6,000
per year paid by Santa Fe. Does not include salary compensation received
from Santa Fe's parent corporation, InterGroup, of $255,000 for each of the
fiscal years ended June 30, 20072010 and June 30, 2006.2009.

(2) During fiscal 20072010 and 2006,2009, the Company and Portsmouth also paid
combined annual premiums of $42,500, for each respective year, for split
dollar whole life insurance policies, owned by, and the beneficiary of which
is, a trust for the benefit of Mr. Winfield's family. Portsmouth's share of
those premiums was $17,000 per year. These policies were obtained in December
1998 and provide for an aggregate death benefit of $2,500,000. The Company
has a secured right to receive, from any proceeds of the policy,
reimbursement of all premiums paid prior to any payments to the beneficiary.

(3) Includes salary and Special Hotel Committee monthly fee and meeting fees
paid by Portsmouth in the aggregate amountsamount of $118,800 and $72,000$105,000
for fiscal yearsyear ended June 30, 20072010 and $94,800 for fiscal year ended June
30, 2006, respectively.2009. Does not include $27,000$31,250 and $22,000$27,000 paid by Santa Fe's parent
company, InterGroup, for fiscal 2007years 2010 and 2006,2009, respectively.

(4) Includes salary paid by Portsmouth in the amount of $45,000 for each of
the fiscal years ended June 30, 2010 and June 30, 2009. Does not include
$90,000 paid by Santa Fe's parent company, InterGroup, for each of fiscal
years 2010 and 2009.

Santa Fe has no stock option plan or stock appreciation rights for its
executive officers. The Company has no pension or long-term incentive plans.
There are no employment contracts between Santa Fe and any executive officer,
and there are no termination-of-employment or change-in-control arrangements.

On July 18, 2003, the disinterested members of the Board of Directors
established a performance based compensation program for the Company's CEO,
John V. Winfield, to keep and retain his services as a direct and active
manager of the Company's securities portfolio. The Company's previous
experience and results with outside money managers was not acceptable.
Pursuant to the criteria established by the Board, Mr. Winfield was be
entitled to performance compensation for his management of the Company's
securities portfolio equal to 20% of all net investment gains generated in
excess of the performance of the S&P 500 Index. Compensation amounts will be
calculated and paid quarterly based on the results of the Company's
investment portfolio for that quarter. Should the Company have a net
investment loss during any quarter, Mr. Winfield would not be entitled to any
further performance-based compensation until any such investment losses are
recouped by the Company. On February 26, 2004, the Board of Directors
amended the performance threshold to require an annualized return equal to
the Prime Rate of Interest (as published in the Wall Street Journal) plus 2%
instead of the S&P 500 Index, effective with the quarterly period commencing
January 1, 2004. This change was made to make the Company's plan be
consistent with that established by its parent company, InterGroup. This
performance based compensation program may be further modified or terminated
at the discretion of the Board. No performance based compensation was paid
for fiscal years ended June 30, 20072010 or 2006.2009.

Internal Revenue Code Limitations

Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code"),
provides that, in the case of a publicly held corporation, the corporation is
not generally allowed to deduct remuneration paid to its chief executive
officer and certain other highly compensated officers to the extent that such
remuneration exceeds $1,000,000 for the taxable year. Certain remuneration,
however, is not subject to disallowance, including compensation paid on a
commission basis and, if certain requirements prescribed by the Code are
satisfied, other performance based compensation. No compensation paid by the
Company to its CEO or other executive officers was subject the deduction
disallowance prescribed by Section 162(m) of the Code.

Outstanding Equity Awards at Fiscal Year End.

The Company did not have any outstanding equity awards at the end of its
fiscal year ended June 30, 20072010 and has no equity compensation plans in
effect.

DIRECTOR COMPENSATION

The bylaws of Santa Fe permit directors to be paid a fixed sum for attendance
at each meeting of the Board or a stated salary as director. Each director
is paid a fee of $1,500 per quarter for a total annual compensation of
$6,000. This policy has been in effect since July 1, 1985. Members of the
Company's Audit Committee also receive a fee of $500 per quarter. Directors
and Committee members are also reimbursed for their out-of-pocket travel
costs to attend meetings. The Board will review and may adjust Director and
Committee Compensation from time to time to assure that the Company can
continue to attract and retain qualified directors.

6
The following table provides information concerning compensation awarded to,
earned by, or paid to the Company's directors for the fiscal year ended June
30, 2007.2010.

Fees Earned
or Paid All Other
Name in Cash Compensation Total
- ----------------- ----------- ------------ -------

John C. Love $ 70,000(1)46,000(1) - $70,000$46,000

William J. Nance $ 70,000(1)46,000(1) - $70,000$46,000

John V. Winfield(2)
- ------------------

(1) Mr. Love and Mr. Nance also serve as directors of the Company's
subsidiary, Portsmouth. Amounts shown include $8,000 in regular board and
audit committee fees paid by Santa Fe and $8,000 in regular board and audit
committee fees paid by Portsmouth. These amounts also include $54,000$30,000 in
6

special hotel committee monthly fees and meeting fees paid to Mr. Love and Mr. Nance by
Portsmouth related to activethe oversight of the
operations, renovations and repositioning of its Hotelhotel asset.

(2) As an executive officer Mr. Winfield director's fees are reported in the
Summary Compensation Table.

Change in Control or Other Arrangements

Except for the foregoing, there are no other arrangements for compensation of
directors and there are no employment contracts between the Company and its
directors or any change in control arrangements.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

As of January 10, 2008,11, 2011, Santa Fe and InterGroup owned 79.8%80.5% of the common
stock of Portsmouth, and InterGroup and John V. Winfield, in the aggregate,
owned approximately 79.4%80.0% of the voting stock of Santa Fe. All of the
Company's Directors serve as directors of InterGroup and all three of the
Company's Directors serve on the Board of Portsmouth.

John V. Winfield, the Company's Chairman and President, Michael G. Zybala,
the Company's Vice President, Secretary and General Counsel, and David T.
Nguyen, the Company's Treasurer and Controller also serve as officers of
InterGroup and Portsmouth. Santa Fe and Portsmouth share corporate office
space with Santa Fe's parent company, InterGroup. Since all three companies
share the same office space, Mr. Winfield, Mr. Zybala and Mr. Nguyen can
allocate their time between the different companies more efficiently on an as
needed basis. Certain costs and expenses, primarily administrative salaries,
rent and insurance, are allocated among the Company, its subsidiary,
Portsmouth, and parent InterGroup based on management's estimate of the pro
rata utilization of resources. During the fiscal years ended June 30, 20072010
and 2006,2009, the Company and Portsmouth made payments to InterGroup of
approximately $146,000 and $160,000 respectively,$144,000 for administrative costs and reimbursement of direct
and indirect costs associated with the management of the Companies and their
investments, including the partnership asset.

During fiscal year 2006, the Company paid $26,000 in preferred stock
dividends to InterGroup.

As Chairman of the Securities Investment Committee, the Company's President
and Chief Executive officer, John V. Winfield, directs the investment
activity of the Company in public and private markets pursuant to authority
granted by the Board of Directors. Mr. Winfield also serves as Chief
Executive Officer and Chairman of Portsmouth and InterGroup and oversees the
investment activity of those companies. Depending on certain market
conditions and various risk factors, the Chief Executive Officer, his family,
Portsmouth and InterGroup may, at times, invest in the same companies in
which the Company invests. The Company encourages such investments because
it places personal resources of the Chief Executive Officer and his family
members, and the resources of Portsmouth and InterGroup, at risk in
connection with investment decisions made on behalf of the Company.

On July 18, 2003, the disinterested members of the Board of Directors
established a performance based compensation program for the Company's CEO to
keep and retain his services as a direct and active manager of the Company's
securities portfolio. Pursuant to the criteria established by the Board, Mr.
Winfield is entitled to performance compensation for his management of the
Company's securities portfolio equal to 20% of all net investment gains
generated in excess of the performance of the S&P 500 Index. Compensation
amounts are calculated and paid quarterly based on the results of the
Company's investment portfolio for that quarter. Should the Company have a
net investment loss during any quarter, Mr. Winfield would not be entitled to
any further performance-based compensation until any such investment losses
are recouped by the Company. On February 26, 2004, the Board of Directors
amended the performance threshold to require an annualized return equal to
the Prime Rate of Interest (as published in the Wall Street Journal) plus 2%
instead of the S&P 500 Index, effective with the quarterly period commencing
January 1, 2004. No such compensation was paid for fiscal years 2007 and
2006. This performance based compensation program may be further modified or
terminated at the discretion of the Board.

In December 1998, Board of Directors authorized the Company to obtain whole
life insurance and split dollar insurance policies covering the Company's
President and Chief Executive Officer, Mr. Winfield. During fiscal years
20072010 and 2006,2009, the Company paid annual premiums of $25,500 for the split
dollar whole life insurance policy, owned by, and the beneficiary of which
is, a trust for the benefit of Mr. Winfield's family. The Company has a
secured right to receive, from any proceeds of the policy, reimbursement of
all premiums paid prior to any payments to the beneficiary. During fiscal
20072010 and 2006,2009, Portsmouth paid annual premiums of $17,000 for a split dollar
policy also covering Mr. Winfield. The premiums associated with that spilt
dollar policy are considered additional compensation to Mr. Winfield.

In August 2007, Portsmouth's Board of Directors authorized an investment of
$973,000 for Portsmouth to acquire a 50% equity interest in Intergroup
Uluniu, Inc., a Hawaii corporation ("Uluniu") in a related party transaction.
Uluniu is a 100% owned subsidiary of InterGroup. Uluniu owns an approximately
two-acre parcel of unimproved land located in Kihei, Maui, Hawaii which is
held for development. The Company's investment in Uluniu represents an amount
equal to the costs paid by InterGroup for the acquisition and carrying costs
of the property through August 2007. The fairness of the financial terms of
the transaction were reviewed and approved by the independent director of
Portsmouth. As of September 5, 2007, $758,000 of the investment amount had
been paid by Portsmouth.

There are no other relationships or related transactions between the Company
and any of its officers, directors, five-percent security holders or their
families which require disclosure.

Director Independence

Santa Fe is an unlisted company and a small business issuerSmaller Reporting Company under the
rules and regulations of the Securities and Exchange Commission ("SEC").
With the exception of the Company's President and CEO, John V. Winfield, all
of Portsmouth's Board of Directors consists of "independent" directors as
independence is defined by the applicable rules and regulations of the SEC
and the National
Association of Securities Dealers' ("NASD").NASDAQ.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF JOHN V.
WINFIELD, JOHN C. LOVE AND WILLIAM J. NANCE AS DIRECTORS OF THE COMPANY

PRINCIPAL HOLDERS OF EQUITY SECURITIES

The following table shows, as of January 10, 200811, 2011, the Common Stock owned by
every person owning of record (other than securities depositories), or known
by the Company to own beneficially, more than 5% of its outstanding common
shares. Any voting securities owned by directors or director nominees are
also disclosed under Election of Directors herein.

Name and Address of Amount and Nature of Percent
Beneficial Owner Beneficial Ownership(1) of Class(2)
- ------------------- ---------------------- ------------------

Guinness Peat Group plc ("GPG") 89,858(3) 7.2%
Allied Mutual Insurance
Services, Ltd. ("AMI")
First Floor, Times Place
London SW1Y 5GP, UK

The InterGroup Corporation 936,459 75.4%
820 Moraga Drive944,379 76.0%
10940 Wilshire Blvd., Suite 2150
Los Angeles, CA 9004990024

John V. Winfield 49,400 4.0%
820 Moraga Drive10940 Wilshire Blvd., Suite 2150
Los Angeles, CA 9004990024

The InterGroup Corporation and 985,859(4) 79.4%993,779(4) 80.0%
John V. Winfield as a group
- ------------------------------

(1) Unless otherwise indicated, and subject to applicable community property
laws, each person has sole voting and investment power with respect to the
shares beneficially owned.

(2) Percentages are calculated on the basis of 1,241,810 shares of Common
Stock issued and outstanding as of January 10, 200811, 2011 plus any securities that
the person has a right to acquire within 60 days pursuant to options,
warrants, conversion privileges or other rights.

(3) Based on their Statement on Schedule 13D (Amendment No. 6) dated June 13,
2001, GPG and its wholly-owned subsidiary AMI claim shared power to vote, or
to direct the vote, and to dispose of, or to direct the disposition of the
shares of Santa Fe's Common Stock owned of record by AMI.

(4) Pursuant to a Voting Trust Agreement dated June 30, 1998, InterGroup has
the power to vote the 49,400 shares of Common Stock owned by Mr. Winfield.
As President, Chairman of the Board and a 62.6%60.2% beneficial shareholder of
InterGroup, Mr. Winfield has voting and dispositive power over the shares
owned of record and beneficially by InterGroup.

As of January 10, 2008,11, 2011, there were 1,241,810 shares of the Company's Common
Stock outstanding, which were held by approximately 280220 shareholders of
record, with a total of approximately 400420 shareholders, including beneficial
owners.

Securities Authorized for Issuance Under Equity Compensation Plans.

Santa Fe has no securities authorized for issuance under equity compensation
plans.

PROPOSAL II2

Ratification of the Appointment of
Independent Registered Public Accounting Firm

The Audit Committee of the Board of Directors has appointed the firm of Burr
Pilger Mayer, Inc. ("BPM", formerly Burr, Pilger & Mayer LLPLLP) as the
Company's independent registered public accounting firm for the fiscal year
ending June 30, 2008.2011. BPM has served as the Company's independent registered
public accounting firm since October 23, 2007. Although the action of
shareholders in this matter is not required, the Audit Committee believes it
is appropriate to seek shareholder ratification of this appointment.
Ratification requires the affirmative vote of a majority of the shares
represented and voted at the Annual Meeting.

On October 23, 2007, the Audit Committee of the Board of Directors
recommended and approved the dismissal of PricewaterhouseCoopers LLP ("PWC")
as the Company's independent registered public accounting firm. PWC served as
the independent registered accounting firm engaged to audit the Company's
financial statements for its two most recent fiscal years. On October 23,
2007, the Audit Committee engaged and appointed Burr, Pilger & Mayer LLP
("BPM") as the Company's new independent registered accounting firm.

The reports of PWC on the financial statements of the Company for the fiscal
years ended June 30, 2007 and 2006 did not contain an adverse opinion or
disclaimer of opinion, and were not qualified or modified as to uncertainty,
audit scope, or accounting principle. During the fiscal years ended June 30,
2007 and 2006 and through October 23, 2007, there were no disagreements with
PWC on any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements (as defined
in Item 304(a)(1)(iv)(A) of Regulation S-B), if not resolved to the
satisfaction of PWC, would have caused PWC to make reference thereto in their
reports on the Company's financial statements for such years. During the
fiscal years ended June 30, 2007 and 2006 and through October 23, 2007, there
were no reportable events as defined in Item 304(a)(1)(iv)(B) of Regulation
S-B.

The Company provided PWC with a copy of the above disclosures and requested
that PWC furnish a letter addressed to the U.S. Securities and Exchange
Commission stating whether or not it agrees with the statements made by the
Company and, if not, stating the respects in which it does not agree. PWC
furnished a letter confirming that it agreed with the statements made by the
Company.

During fiscal years ended June 30, 2007 and 2006 and through October 23,
2007, there were no consultations with BPM on any matters described in Item
304(a)(2)(i) and Item 304(a)(2)(ii) of Regulation S-B.

BPM serves as the auditors of the Justice Investors limited partnership
("Justice" or the Partnership"). Due to the consolidation of the financial
statements of Justice into those of the Company, effective July 1, 2006, the
Audit Committee believed that the engagement of BPM would promote greater
efficiencies and savings for the Company, especially since the hotel owned by
the Partnership is now the major asset and operating entity on the Company's
financial statements.

We expect that a representative of Burr Pilger & Mayer, Inc. will be present at
the Annual Meeting to respond to appropriate questions from shareholders,Shareholders, and
we will provide this representative with an opportunity to make a statement
if he or she desires to do so. We do not expect that a representative of
PricewaterhouseCoopers will be present at the Annual Meeting.

THE FOLLOWING REPORT OF THE AUDIT COMMITTEE SHALL NOT BE DEEMED TO BE
SOLICITING MATERIAL OR TO BE FILED WITH THE SEC UNDER THE SECURITIES ACT OF
1933 OR THE SECURITIES EXCHANGE ACT OF 1934 OR INCORPORATED BY REFERENCE IN
ANY DOCUMENT SO FILED.

AUDIT COMMITTEE REPORT

The Audit Committee's responsibilities are described in a written charter
adopted by the Board of Directors, which is attached as Appendix A to this
Proxy Statement. The Audit Committee primary duties and responsibilities are
to: serve as an independent and objective party to monitor the Company's
financial reporting process and internal control system; appoint and approve
the compensation of the Company'Company's independent registered public accounting
firm; review and appraise the audit efforts of the Company's independent
registered public accounting firm; and provide an open avenue of
communications among the independent registered public accounting firm,
financial and senior management, and the Board of Directors. During fiscal
year ended June 30, 2007,2010, the Company retained Burr Pilger Mayer, Inc.
("BPM") as its independent registered public accounting firm PricewaterhouseCoopers LLP, to provide audit
and audit related services. ThereAll fees and expenses paid to BPM were no fees paid for non-audit services.approved
by the Audit Committee.

The Audit Committee reviewed and discussed the audited financial statements
with management and PricewaterhouseCoopers LLPBPM, and management represented to the Audit Committee
that the consolidated financial statements were prepared in accordance with
accounting principles generally accepted accounting principals.in the United States. The
discussions with PricewaterhouseCoopers LLPBPM also included the matters required by Statement on
Auditing Standards No. 61 (Communication114 (AICPA, Professional Standards, Vol. 1, AU Section
380), as adopted by the Public Company Accounting Oversight Board (United
States) in Rule 3200T regarding "Communication with Audit Committees),
as amended by FAS No. 90 with respect to quarterly financial statements.Committees."

The Audit Committee has also received the written disclosures and the letter
from PricewaterhouseCoopers LLP regarding its independence asBPM required by Independence Standardsapplicable requirements of the Public Company Accounting
Oversight Board Standard No. 1 (Independence Discussionsregarding the independent accountant's communications with
the Audit Committees),Committee concerning independence, which was also discussed with
PricewaterhouseCoopers LLP.BPM.

Based on the Audit Committee's review of the audited financial statements,
and the review and discussions with management and PricewaterhouseCoopers LLPBPM referred to above, the
Audit Committee recommended to the Company's Board of Directors that the
audited financial statements be included in the Company's Annual Report on
Form 10-KSB10-K for the fiscal year ended June 30, 20072010 for filing with the
Securities and Exchange Commission.

THE AUDIT COMMITTEE:
WILLIAM J. NANCE, CHAIRPERSON
JOHN C. LOVE

10
Audit Fees:

The aggregate fees billed for each of the last two fiscal years ended June
30, 20072010 and 20062009 for professional services rendered by PricewaterhouseCoopers LLP,Burr Pilger Mayer,
Inc., the independent registered public accounting firm for the audit of the
Company's annual financial statements and review of financial statements
included in the Company's Form 10-QSB10-Q reports or services normally provided by
the auditorindependent registered public accounting firm in connection with
statutory and regulatory filings or engagements for those fiscal years, were
as follows:

Fiscal Year
-------------------------
2007 20062010 2009
-------- --------
Audit Fees $222,000 $254,000$156,000 $156,000
Audit Related Fees - -
Tax Fees - -
All Other Fees - -
-------- --------
Total: $222,000 $254,000

11
$156,000 $156,000
======== ========

Audit Committee Pre-Approval Policies

The Audit Committee shall pre-approve all auditing services and permitted
non-audit services (including the fees and terms thereof) to be performed for
the Company by its independent registered public accounting firm, subject to
any de minimus exceptions that may be set for non-audit services described in
Section 10A(i)(1)(B) of the Exchange Act which are approved by the Committee
prior to the completion of the audit. The Committee may form and delegate
authority to subcommittees consisting of one or more members when
appropriate, including the authority to grant pre-approvals of audit and
permitted non-audit services, provided that decisions of such subcommittee to
grant pre-approvals shall be presented to the full Committee at its next
scheduled meeting. All of the services described herein were approved by the
Audit Committee pursuant to its pre-approval policies.

None of the hours expended on the independent registered public accounting
firm's engagement to audit the Company's financial statements for the most
recent fiscal year were attributed to work performed by persons other than
the independent registered public accounting firm's full-time permanent
employees.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR"FOR"
RATIFICATION OF THE APPOINTMENT OF BURR PILGER & MAYER, LLPINC.
AS THE COMPANY'S INDEPENDENT REGISTERED PUBLIC ACCOUNTANING FIRM.

PROPOSAL NO. 3

NON-BINDING VOTE ON EXECUTIVE COMPENSATION

In accordance with the requirements of Section 14A of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), which was added by the Dodd-
Frank Wall Street and Consumer Protection Act (the "Dodd Frank Act") and the
related rules of the SEC, we are including in these proxy materials a
separate resolution subject to shareholder vote to approve, in a non-binding
vote, the compensation of our named executive officers as disclosed on pages
5 to 7. The text of the resolution in respect of Proposal No. 3 is as
follows:

"Resolved, that the shareholders approve, in a non-binding vote,
the compensation of the Company's named executive officers as
disclosed on Pages 5 to 7 in the Proxy Statement relating to the
Company's Fiscal 2010 Annual Meeting to be held on February 24,
2011."

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR"
THE APPROVAL OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS.

PROPOSAL NO. 4

NON-BINDING VOTE ON THE FREQUENCY OF SHAREHOLDER VOTES
ON EXECUTIVE COMPENSATION

In accordance with the requirements of Section 14A of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), which was added by the Dodd-
Frank Wall Street and Consumer Protection Act (the "Dodd Frank Act") and the
related rules of the SEC, we are including in these proxy materials a
separate resolution subject to shareholder vote to recommend, in a non-
binding vote, whether a non-binding shareholder vote to approve the
compensation of our named executive officers (that is similar to the non-
binding vote in Proposal 3) should occur every one, two or three years. The
text of the resolution with respect of Proposal 4 is as follows:

"Resolved, that the shareholders recommend, in a non-binding
vote, whether a non-binding shareholder vote to approve the
compensation of the Company's named executive officers should
occur every one, two or three years"

In considering their vote, shareholders may wish to review the information
presented in connection with Proposal 3 and the information on the Company's
compensation policies and decisions regarding named executive officers as
disclosed on pages 5 to 7. In addition, shareholders should note the
following:

* A triennial policy would permit shareholders and directors to
evaluate the effects of our compensation program on long-term
performance and would help align "say on pay" with the goal of
avoiding short-term focus in corporate governance and executive
pay arrangements.

* In addition, the triennial approach would allow shareholders to
engage in a more thoughtful analysis and voting by providing
more time between votes to gage executive officer performance.

For these reasons, we believe that a three-year time horizon is appropriate
in order to provide shareholders with a more comprehensive view of whether or
named executive officer compensation programs are achieving their objectives.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "THREE YEARS"
WITH RESPECT TO HOW FREQUENTLY A NON-BINDING SHAREHOLDER VOTE TO APPROVE
THE COMPENSATION OF OUR EXECUTIVE OFFICERS SHOULD OCCUR.

OTHER BUSINESS

As of the date of this statement, management knows of no business to be
presented at the meeting that is not referred to in the accompanying notice,
other than the approval of the minutes of the last shareholders' meeting,
which action will not amount to ratification of the actions taken at that
meeting.notice.
As to other business that may properly come before the meeting, it is
intended that the proxies properly executed and returned will be voted in
respect thereof at the discretion of the person voting the proxies in
accordance with the best judgment of the person voting the proxies.

SHAREHOLDER PROPOSALS

It is presently anticipated that the fiscal 20082011 Annual Meeting of
Shareholders will be held on or around February 26, 2009.23, 2012. Any shareholder
proposals intended to be considered for inclusion in the proxy statement for
presentation at the fiscal 20082011 Annual Meeting must be received by the
Company no later than October 26, 2008.23, 2011. The proposal must be in accordance
with the provisions of Rule 14a-8 promulgated by the Securities and Exchange
Commission under the Securities Act of 1934. It is suggested that the
proposal be submitted by certified mail - return receipt requested.

FORM 10-KSB and ANNUAL REPORT ON FORM 10-K

The Annual Report to Shareholderson Form 10-K for the 20072010 fiscal year accompanies this
proxy statement, but is not deemed a part of the proxy solicitation material.
A copy of the Company's Form 10-KSB10-K for the fiscal year ended June 30, 2007,2010, as
required to be filed with the Securities and Exchange Commission, excluding
exhibits, will be mailed to shareholders without charge upon written request
to: Michael G. Zybala, Secretary, Santa Fe Financial Corporation, 820 Moraga Drive,10940
Wilshire Blvd., Suite 2150, Los Angeles, CA 90049.90024. Such request must set
forth a good-faith representation that the requesting party was either a
holder of record or a beneficial owner of the common stock of the Company on
January 10, 2008.11, 2011. The Company's Form 10-KSB10-K and other reports are also
available through the Securities and Exchange Commission's world-wide-web
site (http://www.sec.gov).

By Order of the Board of Directors

SANTA FE FINANCIAL CORPORATION

Michael G. Zybala
Secretary

Dated: Los Angeles, California
January 18, 2008

1221, 2011

APPENDIX A

SANTA FE FINANCIAL CORPORATION

AUDIT COMMITTEE CHARTER
(As ReviewedAmended January 15, 2008)13, 2011)

Purpose:
- -------

The primary purpose of the Audit Committee is to assist the Board of
Directors in fulfilling its responsibility of overseeing management's conduct
of the Company's financial reporting process, the Company's systems of
internal accounting and financial controls, and the annual independent audit
of the Company's financial statements.

In discharging its oversight role, the Committee is empowered to investigate
any matter brought to its attention and shall have full access to all books,
records, facilities and personnel of the Company and the power to retain
outside counsel, auditors or other experts for this purpose. The Board and
the Committee are in place to represent the Company's shareholders, and the
Company's independent registered public accounting firm is ultimately
accountable to the Board and the Committee as such representatives of
shareholders. It is the responsibility of the Committee to maintain free and
open means of communication between the Board, the Company's independent
registered public accounting firm and the financial management and internal
auditors of the Company.

The Committee shall review the adequacy of this Charter on an annual basis.

Membership:
- ----------

The Committee shall be comprised of "independent" directors that meet the
composition requirements as defined by the rules of the Securities and
Exchange Commission ("SEC") and the National Association of securities
DealersNASDAQ Stock market LLC ("NASD"NASDAQ") as may
be modified and supplemented from time to time. Accordingly, all of the
members of the Committee will be directors:

1. Who have no relationship to the Company that may interfere with the
exercise of their independence from management and the Company;

2. Are not affiliates of the Company;

3. Do not receive any compensation from the Company other than in the
capacity as director; and

4. Who are financially literate or who become financially literate
within a reasonable period of time after appointment to the Committee.

In addition, at least one member of the Committee will be an audit committee
financial expert as defined by the Securities and Exchange Commission.

The members of the Committee shall be elected by the Board at the annual
meeting of the Board and shall serve until their successors shall be duly
elected and qualified. Unless a Chairman of the Committee is elected by the
full Board, the members of the Committee may designate a Chairman of the
Committee by majority vote of the full Committee Membership.

Meetings:
- --------

The Committee shall meet at least four times annually, or more frequently as
circumstances dictate. A majority of the members of the Committee shall
constitute a quorum for the transaction of business. Minutes of each meeting
of the Committee should be recorded by the Secretary to the Committee.
Approval by a majority of the members present at a meeting at which a quorum
is present shall constitute approval by the Committee. The Committee may also

A-1

act by unanimous written consent without a meeting. As part of its job to
foster open communication, the Committee should meet at least annually with
management and the Company's independent registered public accounting firm in
separate executive sessions to discuss any matters that the Committee or each
of these groups believe should be discussed privately. In addition, the
Committee or at least its Chairman should meet with the Company's independent
registered public accounting firm and management quarterly to review the
Company's financials consistent with #2 below. The Committee may request any
officer or employee of the Company or the Company's outside counsel or the
Company's independent registered public accounting firm to attend a meeting
of the Committee or to meet with any members of, or consultants to, the
Committee.

Key Responsibilities:
- --------------------

The Committee's job is one of oversight, and it recognizes that the Company's
management is responsible for preparing the Company's financial statements
and that the Company's independent registered public accounting firm is
responsible for auditing those financial statements pursuant to professional
standards. Additionally, the Committee recognizes that financial management
has more time, knowledge and detailed information about the Company than do
Committee members. Consequently, in carrying out its oversight
responsibilities, the Committee is not providing any expert or special
assurance as to the Company's financial statements or any professional
certification as to the outside auditor's work.

The following functions shall be the common recurring activities of the
Committee in carrying out its oversight function. These functions are set
forth as a guide with the understanding that the Committee may diverge from
this guide as appropriate given the circumstances.

1. The Committee shall review with management and the Company's
independent registered public accounting firm the audited financial
statements to be included in the Company's Annual Report on Form 10-KSB10-K (or the
Annual Report to Shareholders if distributed prior to the filing of the Form
10-KSB)10-K) prior to the filing of the Form 10-KSB10-K or, if deemed appropriate, prior
to any year-end earnings release. The Committee shall review and consider
with the Company's independent registered public accounting firm the all matters
required to be discussed by Statement ofon Auditing Standards ("SAS") No. 61,114
(AICPA, Professional Standards, Vol. 1, AU Section 380), as amendedadopted by SAS No.90, by auditorsthe
Public Company Accounting Oversight Board (United States) in Rule 3200T
regarding "Communication with audit
committees.Audit Committees."

2. As a whole, or through the Committee chair, the Committee shall
review with the Company's independent registered public accounting firm the
Company's interim financial results to be included in the Company's quarterly
reports to be filed with Securities and Exchange Commission and the matters
required to be discussed by SAS No. 61, as amended by SAS No. 90114 with respect to quarterly financial
statements. Such review will occur prior to the Company's filing of the Form
10-QSB10-Q or, if deemed appropriate, prior to any quarterly earnings releases.

3. Review disclosures made to the Committee by the Company's CEO and
CFO during their certification process for the Form 10-KSB10-K and Form 10-QSB10-Q about
any significant deficiencies in the design or operation of internal controls
or material weaknesses therein and any fraud involving management or other
employees who have a significant role in the Company's internal controls.

4. The Committee shall:

(a) request from the Company's independent registered public
accounting firm annually written disclosures and a formal written statement delineating
all relationships betweenletter
required by applicable requirements of the Public Company
Accounting Oversight Board regarding the independent registered public
accounting firm andaccountant's
communications with the Company consistent with Independence
Standards Board Standard No. 1;Audit Committee concerning independence.

(b) discuss with the Company's independent registered public
accounting firm any disclosed relationships or services which
may impact that firm's objectivity or independence; and

(c) recommend that the Board take appropriate action in response
to the Company's independent registered public accounting firm's
report to satisfy itself of that firm's independence.

A-2

5. The Committee shall have the sole authority to appoint or replace
the Company's independent registered public accounting firm (subject, if
applicable, to shareholder ratification). The Committee shall be directly
responsible for the compensation and oversight of the work of the Company's
independent registered public accounting firm (including resolution of
disagreements between management and the Company's independent registered
public accounting firm regarding financial reporting) for the purpose of
preparing or issuing an audit report or related work. The Company's
independent registered public accounting firm shall report directly to the
Committee.

6. The Committee shall preapprove all auditing services and permitted
non-audit services (including the fees and terms thereof) to be performed for
the company by its independent registered public accounting firm, subject to
the de minimus exceptions for non-audit services described in Section 10A
(i)(1)(B) of the Exchange Act which are approved by the Committee prior to
the completion of the audit. The Committee may form and delegate authority to
subcommittees consisting of one or more members when appropriate, including
the authority to grant preapprovals of audit and permitted nonaudit services,
provided that decisions of such subcommittee to grant preapprovals shall be
presented to the full Committee at its next scheduled meeting.

7. Review and discuss quarterly reports from the Company's independent
registered public accounting firm:

(a) All critical accounting policies and practices to be
used.

(b) All alternative treatments of financial information
within generally accepted accounting principles that have
been discussed with management, ramifications of the use of
such alternative disclosures and treatments, and the
treatment preferred by the independent registered public
accounting.

(c) Other material written communications between the
independent registered public accounting firm and management,
such as any management letter or schedule of unadjusted
differences.

8. Periodically consult with the Company's independent registered
public accounting firm, out of the presence of management, about internal
controls and the fullness and accuracy of the organization's financial
statements.

9. Recommend to the Board policies for the Company's hiring of
employees or former employees of the independent registered public accounting
firm who participated in any capacity in the audit of the Company.

10. Discuss with management the Company's use of "pro forma" or
"adjusted" non-GAAP information, as well as financial information and
earnings guidance provided to analysts and rating agencies. Such discussion
may be done generally (consisting of discussing the types of information to
be disclosed and the types of presentations to be made).

11. Establish regular and separate systems of reporting to the
Committee by each of management, the independent registered public accounting
firm, and the internal accountants regarding any significant judgments made
in management's preparation of the financial statements, and the view of each
as to appropriateness of such judgments.

12. Following completion of the annual audit, review separately with
each of management and the independent registered public accounting firm any
significant difficulties encountered during the course of the audit,
including any restrictions on the scope of work or access to required
information.

13. Review any significant disagreement among management and the
independent registered public accounting firm in connection with the
preparation of the financial statements.

A-3

14. Establish procedures for the receipt, retention and treatment of
complaints received by the Company regarding accounting, internal accounting
controls or auditing matters, and the confidential, anonymous submission by
employees of concerns regarding questionable accounting or auditing matters.

15. Establish, review, and update periodically a Code of Ethical
Conduct, and ensure that management has established a system to enforce this
Code.

16. Review and approve any transactions between the Company and its
officers, directors or 5% shareholders.

17. The Committee shall have the authority, to the extent it deems
necessary or appropriate, to retain independent legal, accounting or other
advisors. The Company shall provide for appropriate funding, as determined by
the Committee, for payment of compensation to the Company's independent
registered public accounting firm for the purpose of rendering or issuing an
audit report and to any advisors employed by the Committee.

Reporting Responsibilities:
- --------------------------

The Committee shall prepare the report required by the rules of the
Securities and Exchange Commission to be included in the Company's annual
proxy statement.

The Committee shall prepare such other reports for the full Board of
Directors and others as it shall deem necessary to discharge its
responsibilities under this Charter.

A-4

Form of Proxy
- -----------------------------------------------------------------------------
Proxy - SANTA FE FINANCIAL CORPORATION
- -----------------------------------------------------------------------------
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD FEBRUARY 21, 200824, 2011

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints John V. Winfield and Michael G. Zybala, and
each of them, the attorneys, agents and proxies of the undersigned, with full
powers of substitution to each, to attend and act as proxy or proxies of the
undersigned at the Annual Meeting of Shareholders of Santa Fe Financial
Corporation to be held at the Hilton San Francisco Financial District, 750
Kearny Street, San Francisco, CA 94108 on Thursday, February 21, 200824, 2011 at 10:30
a.m., and at any and all adjournments thereof, and to vote as specified herein
the number of shares which the undersigned, if personally present, would be
entitled to vote.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS
NOMINATED BY THE BOARD OF DIRECTORS, "FOR" PROPOSALS 2 AND 3, AND "THREE YEARS
FOR PROPOSAL 4. THE PROXY, WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED. IF
NO DIRECTION IS MADE, IT WILL BE VOTED "FOR" THE ELECTION OF DIRECTORS
NOMINATED BY THE BOARD OF DIRECTORS AND "FOR" PROPOSALS 2 AND 3, AND "THREE
YEARS FOR PROPOSAL 4.

The undersigned hereby ratifies and confirms all that the attorneys and
proxies, or any of them, or their substitutes shall lawfully do or cause to be
done by virtue hereof, and hereby revokes any and all proxies heretofore given
by the undersigned to vote at the meeting. The undersigned acknowledges receipt
of the Notice of Annual Meeting and the Proxy Statement accompanying such
notice.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS
NOMINATED BY THE BOARD OF DIRECTORS, AND "FOR" RATIFICATION OF THE RETENTION
OF INDEPENDENT AUDITORS. THE PROXY, WHEN PROPERLY EXECUTED WILL BE VOTED AS
DIRECTED. IF NO DIRECTION IS MADE, IT WILL BE VOTED "FOR" THE ELECTION OF
DIRECTORS NOMINATED BY THE BOARD OF DIRECTORS AND "FOR" RATIFICATION OF THE
RETENTION OF INDEPENDENT AUDITORS.

PLEASE SIGN AND DATE ON REVERSE SIDE

Using a BLACK INK pen, mark your votes with an X as shown in this
example. Please do not write outside the designated areas. [X]

ANNUAL MEETING PROXY CARD

Please fold along the perforation, detach and return the bottom portion in the
enclosed envelope.
- -----------------------------------------------------------------------------

A. Proposals - The Board of Directors recommends a vote FOR all the nominees
listed and FOR proposal 2.Proposals 2 and 3 and THREE YEARS for Proposal 4.

1. Election of Directors: For Withhold For Withhold

01 - John V. Winfield [ ] [ ] 02 - John C. Love [ ] [ ]

03 - William J. Nance [ ] [ ]

2. RATIFICATION OF THE RETENTION OF BURR,Ratification of the Retention of Burr For Against Abstain
PILGER & MAYER LLPPilger Mayer, Inc. as the independent
registered accounting firm for the Company [ ] [ ] [ ]
for the fiscal year ending June 30, 2008.2011.

3. To approve, by non-binding vote, the For Against Abstain
compensation of the named executive
officers. [ ] [ ] [ ]

4. To recommend, by non-binding vote, the 1 Yr. 2 Yrs. 3 Yrs. Abstain
frequency of shareholder votes on
named executive officer compensation. [ ] [ ] [ ] [ ]

5. OTHER BUSINESS. In their discretion, the proxies are authorized to vote
upon such other business as may properly come before the meeting and at
any and all adjournments thereof. The Board of Directors at present knows
of no other business to be presented by or on behalf of the Company or the
Board of Directors at the meeting.

B. Non-Voting Items

Change of Address - Please print new address below. Meeting Attendance
Mark box to the
[ ] right if you plan [ ]
[ ] to attend the
[ ] Annual Meeting

C. Authorized Signatures - This section must be completed for your vote to be
Counted - Date and Sign Below

Please date this proxy card and sign exactly as your name appears on this card.
Joint owners should each sign personally. Corporate proxies should be signed by
an authorized officer. Executors, administrators, trustees, etc., should give
their full titles.

Date (mm/dd/yyyy) - Please print date below.

[ / / ]
[ ]

Signature 1 - Please keep signature within the box.

[ ]
[ ]

Signature 2 - Please keep signature within the box.

[ ]
[ ]