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Amman Stock Exchange

Amman Stock Exchange. Jalil Tarif Chief Executive Officer. AMEDA Meeting. Dead Sea - Jordan October 2007. 1930s Trading in Securities started informally. 1976 Amman Financial Market (AFM) was established. 1978 AFM started operations.

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Amman Stock Exchange

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  1. Amman Stock Exchange Jalil Tarif Chief Executive Officer • AMEDA Meeting Dead Sea - Jordan October 2007

  2. 1930s Trading in Securities started informally. 1976 Amman Financial Market (AFM) was established. 1978 AFM started operations. 1997 Capital Market Reforms introduced, Securities Law issued. 1997 Jordan Securities Commission (JSC)was established. 1999 Amman Stock Exchange (ASE) was established. 1999 Securities Depository Center (SDC) was established 2002New Securities Law Issued. History of Capital Market

  3. Jordan Securities Commission (1997) Amman Stock Exchange (1999) Securities Depository Center (1999) Capital Market in Jordan Public Shareholding Companies Certified Financial Professionals Mutual Funds Financial Services Companies Financial Brokerage Investment Trusteeship Investment Management Financial Advisory Management of Primary Issues Custodian

  4. Established in March 1999 Amman Stock Exchange (ASE) • Independent legal entity • Managed by private sector • Membership of brokers • Non for-profit

  5. Second Market First Market Right to Commence Operations Financial Position Requirements: Profitability Dividends ( Cash or Stock) Securities Listing Requirements Financial Reporting: Annual Report Semi Annual Report Liquidity Requirements: Free Float Turnover Trading Days Number of shareholders Continuous Listing Requirements Bonds Government and Corporate Bonds are eligible for listing Financial Reporting: Annual Report Semi Annual Report Quarterly Report

  6. Backup Trading Floor Surveillance Trading System Overview Production Servers Remote Brokers Information Dissemination (NSC) (GL) Websites TV Channels UNIX BOX High Availability Cluster Powerful Dual Processor CONNECTION Fiber Optics Leased Lines FACILITIES Remote Trading Remote Inquiry Intranet Data Vendors Hosts Main Database Trading System Mobile Phones Market Monitors Users Trading Floor Surveillance Information Display Screens

  7. ASE disseminates clear, accurate, sufficient and timely information and data on securities trading. • ASE discloses information on issuers, members, and material information. Public may have access to these material. • Data disseminated through GL stations, data vendors, market watch, ASE website, and TV stations. • Times of transactions information posted at the ASE site. • Post trade data sent to brokers through Domino. Information Dissemination

  8. http://www.exchange.jo

  9. ASE Market Capitalization & Trading Value (US$ million) Trading Value * End of September Market Cap

  10. Average Daily No. of Transactions * End of September

  11. ASE Performance (%) * End of September

  12. Primary Market (US$ million) (Point) * End of September

  13. Market Velocity * End of September

  14. The Market P/E Ratio (Times) Historical Average = 17 * End of September

  15. Non-Jordanian Ownership, September 2007 (%)

  16. Investors may be able to achieve additional diversification by investing in the ASE • On a risk-adjusted basis (Sharp Ratio),the ASE outperformed most markets. • ASE compares favorably with many other regional markets in terms of investment climate. • Low price volatility. Recent Study by IMF

  17. Poland Israel South Korea Chile Czech Republic South Africa Taiwan Hungary Mexico Malaysia Brazil Jordan India Country Macro-Factors Political Stability Transparency Productive Labor Practices Thailand Turkey Peru Argentina Philippines Colombia China Morocco Sri Lanka Venezuela Indonesia Russia Egypt Pakistan Permissible Equity Markets Investment Analysis, CalPERS Market Macro-Factors Market Liquidity and Volatility Transparency Market Regulation/Legal System/Investor Protection Capital Market Openness Settlement Proficiency/ Transaction Costs

  18. Jordan National Financial Center Project • Upgrading the trading system • Internet trading. • Demutualization • New ASE Dow Jones Index Future Plans

  19. The Center will contain: • ASE • SDC • Financial Studies Center • Brokers’ Offices • Investors Gallery • Other facilities • The Center total area 85758 m2 .(Buildings area 51766 m2) • Total cost US$ 100 million • Expected completion date November 2009 Jordan National Financial Center Project

  20. Project’s Site

  21. The external design of the building is inspired from the Siqq of Petra which is considered an ancient symbol in Jordan’s history. Project’s Concept

  22. Jordan National Financial Center Project

  23. A contract was signed with AtosEuronext Market Solutions and GL Trade for Euro 2.5 million. • New trading system V900. • Fully Linux environment. • System applied in major stock exchanges. • Better flexibility to implement market rules. • Highly improve system capacity and lower latency. • The new system will be up and running by May 2008. Upgrading the Trading System

  24. The new Securities Law for 2002 authorized setting up other stock exchanges • The ASE may be restructured by a decision of the Board of Commissioners of the JSC, upon approval of the Council of Ministers. • Negotiations are taking place with alliances to support demutualization process. • The ASE shall become shareholding company totally owned by the Government as a first step. • The Government then shall sell a share to financial institutions, brokerage firms, international institutions and other parties. Demutualization

  25. An agreement with Dow Jones was signed in late 2006 • Dow Jones will calculate a new composite index, named “The Amman Stock Exchange and Dow Jones”. • The new index will be weighted by market capitalization of free float shares. • The index can be used as a base tool in forming financial derivatives and ETFs. • The index will be launched in late 2007. New ASE Dow Jones Index.

  26. Internet Trading. • Joining the WFE. • Codes of Corporate Governance • Introducing new instruments. • Marketing strategy. Other Projects

  27. International Exposure

  28. Political Stability Privatization Investment Opportunities No ceiling on foreign equity ownership Free repatriation of investment and income No taxes on cash dividends Economic Openness and Free Trade No capital gains tax

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