JSE Strategic Communication Session 7 June 2012

1. JSE Strategic Communication Session7 June 2012

2. Agenda

3. Agenda

4. JSE Strategy Recap

5. RECAP - JSE�s Business Model

8. Agenda

9. JSE Strategic Initiatives Customer Relationship Management (CRM)

10. Customer Relationship Management (CRM) We have recognised that we require a technical solution as an enabler to delivering an improved service to our clients. � Why? We have silos of information pertaining to our clients across the JSE, ACCPAC CRM will give us a consolidated and single view of our client. � What? The ACCPAC CRM solution has been selected by the JSE. An off the shelf package that will be customised to suit our unique requirements. Consists of various modules from Contact and case management through to Sales and Marketing. � How Far? We are in the process of obtaining and documenting business requirements for Client Services and all departments with whom they interact � When? As part of Release A of Project Orion Phase 1��� Client Services and departments with whom they interact Phase 2��� Remainder of JSE � Future WEB Self Service (allow clients access via the web to log and track enquiries) Computer Telephony Integration (recognises your client as the phone rings and displays client detailsWe have recognised that we require a technical solution as an enabler to delivering an improved service to our clients. � Why? We have silos of information pertaining to our clients across the JSE, ACCPAC CRM will give us a consolidated and single view of our client. � What? The ACCPAC CRM solution has been selected by the JSE. An off the shelf package that will be customised to suit our unique requirements. Consists of various modules from Contact and case management through to Sales and Marketing. � How Far? We are in the process of obtaining and documenting business requirements for Client Services and all departments with whom they interact � When? As part of Release A of Project Orion Phase 1��� Client Services and departments with whom they interact Phase 2��� Remainder of JSE � Future WEB Self Service (allow clients access via the web to log and track enquiries) Computer Telephony Integration (recognises your client as the phone rings and displays client details

11. eCRM Initiative What is the ACCPAC CRM solution? An 'off-the-shelf' package customised to suit the JSE�s requirements It is a flexible browser based application that can integrate with almost any application Why do we want to implement an ACCPAC CRM solution? It will provide the JSE with a single view of the client from inception throughout the life cycle of the client The application is fully integrated with Outlook and has the ability to integrate with most applications

12. JSE Strategic InitiativesInterest Rate Market (IRM)

13. Interest Rate Market (IRM) JSE�s intention to respond to client needs by expanding the range of the current SAFEX interest rate products and increase liquidity as an alternative trading platform closely aligned with current FDD structure and a market with separate membership and comprehensive regulation and supervision Variety of innovative products and new instruments Order driven, anonymous central order book JSE�s world class equity and derivative market model World first in terms of offering a single platform for the trading of interest rate products both on a price and yield basis IRM is being investigated for implementation for the last quarter of 2004

14. JSE Strategic Initiatives The Alternative Exchange (AltX)

15. The Alternative Exchange (AltX)

16. JSE Strategic Initiatives New Indices

17. Style Indices Style � Investment strategy that groups companies by apparent different rate of returns. All existing indices remain unchanged. Just another way to look at the companies listed on the JSE. Another dimension of JSE companies. Other dimensions are size, returns, sectors etc. Used to � Forecast returns, Provide greater choice to clients Management tool Improve reporting to clients Performance measurement / attribution

18. Style Indices (Cont.) Live in July History till 2 January 2002 will be provided immediately Earlier history to be done in 2005 (IT technicalities)

19. Social Responsibility Investment (SRI) Index SRI Index created as a means of helping to focus debate on triple bottom line practices and to recognise tremendous efforts already made by SA companies in this area Measures companies policies, performance and reporting in relation to the 3 pillars of the bottom line (environmental, economic and social sustainability) and corporate governance practice

20. Social Responsibility Investment (SRI) Index (Cont.) All companies in FTSE/JSE All Share Index invited to participate in process on a voluntary basis. 74 Listed companies participated and 51 companies met the criteria SRI Index is the first index of this nature in an emerging market and the first in the world to be launch by an exchange 17 of the constituents are part of MidCap Index and 3 are part of the SmallCap Index

21. JSE Strategic Initiatives New Products

22. Inward Dual Listings Minister of Finance announced in 2004 budget that Companies will able to raise capital in South African Capital Markets � Details still to be finalised with National Treasury Will be subject to current Exchange Control restrictions 5% Institutional Investment R750 000 Individual Limit

23. JSE Strategic Initiatives APD Systems Issues

24. Agricultural Products � ATS System Various options investigated to address the APD ATS system performance issues. SAFEX system originally written to support much smaller market - software has not been upgraded to cater for ongoing market growth/demand. JSE conducted investigations into possible solutions � Initial analysis of new software version implemented in November 2003 indicate new version was generating increased message volumes between trading engine and member trading front-end. Testing indicates current and previous releases of software do not differ in message volumes.

25. Agricultural Products � ATS System (Cont.) Performance problems experienced under load conditions and increased market activity. Application performance test tool developed to simulate market activity/ ID any performance bottlenecks. Application re-engineering options under consideration - redesign of application message flows and/or implementation of message compression to reduce message sizes and improve message throughput. Work currently in progress to identify correct re-engineering option

26. Agricultural Products � ATS System (Cont.) User Community tests will be held requiring full market participation in production environment to assist in confirming successful resolution of the problem. Proposed solutions short-term � Project Orion will provide permanent solution.

27. Project OrionBackground and Objective

28. Recap on existing JSE IT Environment Operations Mainframe operations outsourced to Comparex Open server operations maintained by JSE Applications BDA application (nearly 20 years old) outsourced to Connection 42 and runs on the mainframe Equities trading and information dissemination operations and application outsourced to London Stock Exchange Other JSE mainframe applications maintained by JSE Some open server applications maintained by JSE, others outsourced (e.g. GL Trade) Derivatives trading and clearing application outsourced to STT Databases Oracle, SQL, Datacom, DB2, Btrieve, Pervasive Operating systems IBM, Microsoft NT, Unix, etc

29. Objective of Project Orion Project Orion is about: Transforming ALL JSE IT in a 27 month period Ensuring new generation architecture is operated and managed efficiently with resources skilled in new technologies Operating IT more efficiently at lower cost in the future Taking 42 systems and consolidating them into 16 systems Working together with Accenture, as the IT transformation partner, to achieve this objective

30. Why do we want to do this? JSE business totally dependent on IT IT becoming increasingly commoditised and therefore low TCO will be a major determinant for success of Exchanges in the future JSE historical IT cost growth in excess of inflation Existing JSE IT environment challenges Empowering business units to exploit IT capability Reduce IT costs ��.Whilst still retaining control

31. Technology Drivers

32. Project Orion Architecture

33. Technical Blueprint

34. Current JSE Application Architecture Operations Mainframe operations outsourced to Comparex Open server operations maintained by JSE Applications BDA application (nearly 20 years old) outsourced to Connection 42 and runs on the mainframe Equities trading and information dissemination operations and application outsourced to London Stock Exchange Other JSE mainframe applications maintained by JSE Some open server applications maintained by JSE, others outsourced (e.g. GL Trade) Derivatives trading and clearing application outsourced to STT Databases Oracle, SQL, Datacom, DB2, Btrieve, Pervasive Operating systems IBM, Microsoft NT, Unix, etc Operations Mainframe operations outsourced to Comparex Open server operations maintained by JSE Applications BDA application (nearly 20 years old) outsourced to Connection 42 and runs on the mainframe Equities trading and information dissemination operations and application outsourced to London Stock Exchange Other JSE mainframe applications maintained by JSE Some open server applications maintained by JSE, others outsourced (e.g. GL Trade) Derivatives trading and clearing application outsourced to STT Databases Oracle, SQL, Datacom, DB2, Btrieve, Pervasive Operating systems IBM, Microsoft NT, Unix, etc

35. Orion Solution Architecture

36. Build vs. Buy onExchange Located in Boston, Massachusetts, USA onExchange clearing clients: The London Clearing House, U.K. New York Board of Trade, USA New York Mercantile Exchange, USA Hedge Street, (Trading and Clearing) USA Energy Clear Operations Company, USA Architecture team includes key architect of a clearing system used at three large global exchange clearinghouses, and the chief architect of four electronic trading systems. Senior management, engineering and architecture design team members each have over 15 years of trading, clearing, exchange operations, software and high volume trade processing system experience Key global financial markets partners include Accenture, HP and BEA onExchange provides the most advanced real-time, J2EE trade-processing development framework for clearing houses and exchanges The onExchange framework reduces cost, risk and development time by providing the foundation for building a JSE customized and tailored clearing, settlement and trading solution History of FRI Founded over 36 years ago as a research cooperative within McGill University Became a private corporation in 1977 Dedicated exclusively to servicing the global financial community Since 1995 FRI has acquired three companies: Nexgen, Compuchan and NAQ FRI�s Longevity Leading Canadian Supplier since 1968 for Securities Valuation and Corporate Action Data-Over 36 years Major Supplier since 1974 of Portfolio Management Systems- Over 30 years ASP Outsourcing Expertise since 1974-Over 30 years On-Site Licensing Offerings since 1987-Over 17 years Average Employees Experience with FRI � 7 Years Average Industry Experience from Management Team � 20 Years onExchange Located in Boston, Massachusetts, USA onExchange clearing clients: The London Clearing House, U.K. New York Board of Trade, USA New York Mercantile Exchange, USA Hedge Street, (Trading and Clearing) USA Energy Clear Operations Company, USA Architecture team includes key architect of a clearing system used at three large global exchange clearinghouses, and the chief architect of four electronic trading systems. Senior management, engineering and architecture design team members each have over 15 years of trading, clearing, exchange operations, software and high volume trade processing system experience Key global financial markets partners include Accenture, HP and BEA onExchange provides the most advanced real-time, J2EE trade-processing development framework for clearing houses and exchanges The onExchange framework reduces cost, risk and development time by providing the foundation for building a JSE customized and tailored clearing, settlement and trading solution History of FRI Founded over 36 years ago as a research cooperative within McGill University Became a private corporation in 1977 Dedicated exclusively to servicing the global financial community Since 1995 FRI has acquired three companies: Nexgen, Compuchan and NAQ FRI�s Longevity Leading Canadian Supplier since 1968 for Securities Valuation and Corporate Action Data-Over 36 years Major Supplier since 1974 of Portfolio Management Systems- Over 30 years ASP Outsourcing Expertise since 1974-Over 30 years On-Site Licensing Offerings since 1987-Over 17 years Average Employees Experience with FRI � 7 Years Average Industry Experience from Management Team � 20 Years

37. New Clearing Model Please refer to slide 6, need to add more detailPlease refer to slide 6, need to add more detail

38. Technical Benefits of the Orion Solutions Please refer to slide 6, need to add more detailPlease refer to slide 6, need to add more detail

39. Technical Benefits of the Orion Solutions (Cont.) Please refer to slide 6, need to add more detailPlease refer to slide 6, need to add more detail

40. Project Orion Current Status

41. Current Status Analysis Phase is complete Design Phase has begun Design Phase will run for an 18 week period and ends at the end of September 2004 Planning for User Readiness and Training has started

42. Migration Plan Phased migration approach where possible Target for final decommissioning of all mainframe systems is 1st Quarter 2006 BDA decommissioning in 4th Quarter 2005 (Big Bang!) User readiness and training as integral elements of the approach Dress Rehearsals: What is it? Simulation of a normal trading day Purpose is to run the market as it would in the new environment to ensure market functions correctly Probably Mandatory Members will be involved at different times in different releases We will give plenty of notice and communicate as and when necessary

43. Release A � Information Services Reference Data JSE Reference Data describes key JSE business entities in terms of their �static� attributes. It is by nature non-transactional and is required for purposes of referential integrity checking from a variety of other operational and transactional systems Reference data is vital to all functions and �clean� data is a must - therefore it is imperative that the JSE has an effective and efficient Reference Data Management strategy Real Time Data Store This custom application will provide intra-day private and public trading data for market surveillance, market support and intra-day snapshots. It will also store this data temporarily, prior to being transferred to a data warehouse for historical and statistical purposes A Real Time Data Store is well integrated with the operational environment for business processes and is a data foundation that supports these processes with near real-time business intelligence Enterprise Data Warehouse Long term objectives: Define and agree a enterprise data strategy to eradicate inefficiencies and to ensure consistency and standards; Facilitate internal JSE business decisions by providing complete, accurate, consistent, value-added and relevant information; and Sell JSE information to external customers Release B: Clearing and Market Services Equity Clearing and Market Services BDA will be replaced by the FRI and ECS solutions The Equity Clearing solution will be released in Release B Derivative Clearing The Derivative Clearing solution will be released in Release C Release A � Information Services Reference Data JSE Reference Data describes key JSE business entities in terms of their �static� attributes. It is by nature non-transactional and is required for purposes of referential integrity checking from a variety of other operational and transactional systems Reference data is vital to all functions and �clean� data is a must - therefore it is imperative that the JSE has an effective and efficient Reference Data Management strategy Real Time Data Store This custom application will provide intra-day private and public trading data for market surveillance, market support and intra-day snapshots. It will also store this data temporarily, prior to being transferred to a data warehouse for historical and statistical purposes A Real Time Data Store is well integrated with the operational environment for business processes and is a data foundation that supports these processes with near real-time business intelligence Enterprise Data Warehouse Long term objectives: Define and agree a enterprise data strategy to eradicate inefficiencies and to ensure consistency and standards; Facilitate internal JSE business decisions by providing complete, accurate, consistent, value-added and relevant information; and Sell JSE information to external customers Release B: Clearing and Market Services Equity Clearing and Market Services BDA will be replaced by the FRI and ECS solutions The Equity Clearing solution will be released in Release B Derivative Clearing The Derivative Clearing solution will be released in Release C

44. User Readiness Initiative

45. Training The User Readiness initiative will adopt a �Train the Trainer� (Training Champions) approach Extensive training will be provided to ensure efficient and effective use of the new solutions Training will include conceptual and detailed hands-on application training Trainees will be supported through manuals and job aids

46. Communication and Information

48. Questions