A Superior MarketplaceA Superior Marketplace

BOVESPAHighlights

• Founded in 1890

• Self-regulatory organization supervised by the Brazilian Securities and Exchange Commission – CVM

• Broad Product Base

• Fully accessible by international investors

• State-of-the-art technology

• Standard setter for corporate governance in Brazil

• Vibrant IPO market

• International Reference

EQUITY CASH

• Stocks

• BDRs

• REITs

PRODUCTS Broad Product Base

EQUITY DERIVATIVES • Stock Options

• Index Options

– on Bovespa Index

– on IBrX Index

• Forward Contracts

• Warrants

• ETFs

• POP - Protected

and Participative Investment

FIXED INCOME• Debentures

• Commercial Papers

• Mortgage-Backed securities

• Asset-backed securities (FIDC)

INDICESExtensive Benchmarking

OVERALL MARKET INDICES

• IBOVESPA - BOVESPA INDEX

– Companies representing 80% of the total trading value

• IBrX-50 – BRAZIL INDEX 50

– 50 most liquid shares of the cash market

• IBrX - BRAZIL INDEX

– 100 most liquid shares of the cash market

• IVBX – Valor BOVESPA Index

– 50 companies on second tier

governance issues

SECTOR BASED INDICES• IEE – ELECTRIC POWER INDEX

– Most liquid companies of the electric power sector

• ITEL – TELECOMMUNICATIONS INDEX

– All companies in the telecommunication sector

• INDX – INDUSTRIAL SECTOR INDEX

– Industry most representative stocks

CORPORATE GOVERNANCE INDICES• IGC – CORPORATE GOVERNANCE INDEX

– Companies traded in the Novo Mercado or Levels 1 and 2

• ITAG – TAG ALONG COMPANIES’ INDEX

– Companies that offer tag along rights to all shares

• ISE - CORPORATE SUSTAINABILITY INDEX

– Companies committed to environmental, social and corporate governance issues

INTERNATIONAL INVESTMENTS A fully accessible market

REGISTRATION AT CVM (Securities

and Exchange Commission)

– Registration granted in 24 hours

– Online registration through the website

– Registration form required (Basic Information)

REQUIREMENTS

– A local representative in Brazil

– Assets must be deposited at a recognized depository service

– Accounts hold under an authorized custodian

– Tax ID number required (CNPJ)

REGULATORY OVERVIEW

– No restrictions in terms of the type of investments

– No diversification rules

– No minimum permanence period requirement

– Final beneficiary market

TAXATION

– Exemption on capital gains for equity instruments and government bonds

– Exemption of CPMF tax of 0.38% on inflows and outflows for equity instruments

– Tax haven investors taxed as domestic investors

INVESTORS AT BOVESPAParticipation in the trading value

22 26 28 23 25 23

17

28 2828 27 29

26

2427 33 36 36

3

43

2 332

14 13 10 10

3

18

0%

10%

20%

30%

40%50%

60%

70%

80%

90%

100%

2002 2003 2004 2005 2006 July/07

Individual Investors Institutional Investors International Investors

Companies Financial Institutions

Source: BOVESPA

North America

49%

South America

19%

Asia and Pacific

2%

Europe27%

Middle East1%

Central America

2%

419

667

2,563

1120

272198

2002 2003 2004 2005 2006 July/07

BOVESPA IN NUMBERSDaily Average Trading Value

in USD million

Source: BOVESPA

BOVESPA74%

Mexico16%

Santiago6%

Lima1%

Colombia2% Buenos

Aires1%

Latin American Exchanges Daily Average Trading Value in July 2007

Source: WFE – World Federation of Exchanges

LEADERSHIP IN LATIN AMERICA

BOVESPA IN NUMBERSOptions Market

Source: BOVESPA, WFE – World Federation of Exchanges and ISE - International Stock Exchange

Exchange# of

contracts

million

Notional – US$

million

1st International Securities Exchange

347 n.a.

2nd CBOE 232 n.a.

3rd São Paulo 190 478

4th Eurex 178 842

5th Philadelphia 168 64

Options on Equities

Up to June 2007Rank

in 2006

Rank

in 2005

Exchange Underlying

Equity

Millions

traded1 7 Sao Paulo SE Petrobras PN 207

2 2 Eurex Allianz 39

3 3 OMX Ericsson B 39

4 4 ISE QQQQ 37

5 1 São Paulo SE Telemar PN 34

6 10 Eurex Deutsche Telekom

30

7 5 São Paulo SE Net PN 22

8 +20 ISE IWM 20

9 +20 São Paulo SE Vale do Rio Doce PNA

19

10 19 ISE SPY 17

TOP 10 traded stock options

in the world in 2006

TRADING INFRASTRUCTUREState-of-the-art technology

• 100% of the trades executed electronically with specialized trading systems for Equities, Equities’ Derivatives and Corporate Bonds;

– MEGA BOLSA – Order driven system operated in more

than 20 exchanges around the world;

• DMA Facilities (Direct Market Access)– HOME BROKER and Institutional Connection: 37% of the trades and 19% of the trading value

(July/2007)

– BOVESPA FIX – a platform developed specifically

for bond trading;

• Trading system linked electronically, in real time basis, to the clearing and settlement system – all trades are locked in for settlement;

TRADING INFRASTRUCTUREA permanent challenge

• More than 1200 terminals connected to Megabolsa

• Our execution speed is in average fractions of a second

• At peak, the system processes over 200,000 trades and 1 million orders per day

Daily Average Number of Trades Registered at Megabolsa

In thousands

22,426,8

53,8

62,2

39,528,2

87,4

2000 2001 2002 2003 2004 2005 2006 July/07

Source: BOVESPA

157,4

• 75% provide financial statements in USGAAP or IFRS

• 35% voluntarily provide tag along rights and belong to Itag

• 57% adhered to Novo Mercado, Level 2 or Level 1

In USD billionMarket Capitalization

BOVESPA’S LISTED COMPANIES

433 Listed Companies

1,129

723

482

341234

124

2002 2003 2004 2005 2006 J uly/07

Source: BOVESPA

CORPORATE GOVERNANCEA new standard is set

NOVO MERCADO

– Shareholders’ rights• Only one class of shares, with full voting rights: one share,

one vote• Full tag along rights

– Higher disclosure Standards• Annual financial statements in IFRS or US GAAP• Improved Quarterly Reports (ITRs), including an English

version, consolidated financial statements and cash flow statements

• Related party transactions• Trading and ownership of the company´s shares by the

management and the controlling shareholders

– Other listing requirements• Delisting: tender offer at a price based, at least, on the

economic value• Board of directors: a minimum of 5 members, maximum

two years terms • 25% minimum free-float and adoption of special procedures

in public offerings to enhance the dispersion of the company´s shares

• Adhesion to an arbitration panel (dispute resolution)

SPECIAL LEVELS OF CORPORATE GOVERNANCE

– Nível 1 (level 1)• Higher disclosure standards of Novo

Mercado

– Nível 2 (level 2) • Higher disclosure standards of Novo

Mercado• Must comply with all the requirements of

the Novo Mercado• Exception:

– May continue to issue non-voting,« preferred » shares (PN), but these « preferred » shares will have voting rights in some circumstances

18 24 31 33 37 36 4033 7 10 14 18

18

81

7

44

22

2001 2002 2003 2004 2005 2006 July 2007

NM

N2

N1

139 companies

CORPORATE GOVERNANCEListing Segments

• Novo Mercado’s Consolidation6 years after launching– 32% of total listed companies– 57% of total market capitalization– 68% of total trading value

Source: BOVESPA

BOVESPA IN NUMBERS Market Performance

0

100

200

300

400

500

600

700

800

900

1000

1100

1200

dec/

02

feb/0

3april/0

3ju

n/0

3aug/0

3oct

/03

dec/

03

feb/0

4april/0

4ju

n/0

4aug/0

4oct

/04

dec/

04

feb/0

5april/0

5ju

n/0

5aug/0

5oct

/05

dec/

05

feb/0

6april/0

6ju

ne/0

6aug/0

6oct

/06

dec/

06

feb/0

7abr/

07

june/0

7

July 06 – July 07

IGC = + 79%ITAG = + 73%

IBOVESPA = + 69%IBRX 50 = + 67%

IBovespa x ITag x IGC x IBrX 50

Base 100 on Dec. 2002

Source: BOVESPA

CAPITAL RAISING ACTIVITY Distinctive Features

HIGHEST STANDARDS OF

CORPORATE GOVERNANCE

Most of the newcomers joined Novo Mercado

PLACE OF LISTING

Most of the listings only at BOVESPA

70%

65%

68%

63%

71%

69%

93%

56%

53%

76%

72%

67%

68%

77%

Profarma

Terna

Brasil Ecodiesel

OdontoPrev

Lopes

Positivo Info.

PDG

Camargo Corrêa

São Martinho

GVT

Iguatemi

Rodobens

Tecnisa

Anhanguera

STRONG PARTICIPATION OF INTERNATIONAL INVESTORS IN IPOs

2006 and 2007

Source: BOVESPA

Capital Raised by Brazilian Companies:

Up to July/2007: US$ 23.1 billion

2006: US$ 16.5 billion

2005: US$ 10.9 billion

2004: US$ 3.8 billion

CAPITAL RAISING ACTIVITY

Capital raised through shares - Top 10 Markets US$ million – Up to July 2007

Source: WFE – World Federation of Exchanges

Nasdaq

National Stock Exchange India

Sao Paulo SE

Shanghai SE

Hong Kong Exchanges

TSX Group

BME Spanish Exchanges

Australian SE

London SE

NYSE Group

IPO Secondary Offerings

54

46

45

34

29

27

23

15

11

94

BOVESPA IN THE WORLDThought Leadership

• Member of the Board

• National Numbering Agency for ISIN Codes

• Chairman of the Ibero-American Federation of Exchanges

• Member of the SRO Consultative Committee

• OECD – Member of the Roundtable on Corporate Governance

For more information about BOVESPAContact BOVESPA: Development and International Relations Department:

Advisor: Cristiana Pereira – cpereira@bovespa.com.br

Lucy Pamboukdjian – lpambouk@bovespa.com.br

Mariana Carmo – mcarmo@bovespa.com.br

David Rodrigues – dsrodrigues@bovespa.com.br

Visit:www.bovespa.com.br/English

Disclaimer “This presentation is provided for information purposes only. The information provided is not an invitation to purchase securities listed on São Paulo Stock Exchange.

Do not copy, distribute, sell or modify this presentation without BOVESPA´s prior written consent”.

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