Belarusian Currency and Stock Exchange Activity Report 2006.

Belarusian Currency and Stock ExchangeBelarusian Currency and Stock Exchange

Activity ReportActivity Report

20020066

MAIN ACTIVITYMAIN ACTIVITY. .

TECHNOLOGIES AND TECHNOLOGIES AND RESOURCE BASERESOURCE BASE

The increase of the authorized capital by changing the par value from The increase of the authorized capital by changing the par value from BYR 130 to BYR 160. As of January 1, 2007 the authorized capital BYR 130 to BYR 160. As of January 1, 2007 the authorized capital amounted to USD 3.06 mln (BYR 6.55 bln) . amounted to USD 3.06 mln (BYR 6.55 bln) .

A new Charter of the BCSE was adopted to meet the requirements of A new Charter of the BCSE was adopted to meet the requirements of the Law “On economic companies” that came into force in 2006. the Law “On economic companies” that came into force in 2006.

The change of organization structure aimed at increasing theThe change of organization structure aimed at increasing the effectiveness the BCSE's activityeffectiveness the BCSE's activity

Introduction of the BCSE Development Strategy for 2007-2011Introduction of the BCSE Development Strategy for 2007-2011

RESULTS OF 2006. THE DEVELOPMENT OF RESULTS OF 2006. THE DEVELOPMENT OF TRADE AND SETTLEMENT TECHNOLOGIESTRADE AND SETTLEMENT TECHNOLOGIES

CURENCY MARKETCURENCY MARKET

Introduction of new trade and settlement complex based on modern on-line Introduction of new trade and settlement complex based on modern on-line systems technologies and providing a to wide range of functional facilitiessystems technologies and providing a to wide range of functional facilities

Stepwise realization of the price policy program aimed at Stepwise realization of the price policy program aimed at reducreducing trade ing trade participants’ expensesparticipants’ expenses. . Exchange fees for all quoted currencies were Exchange fees for all quoted currencies were lowered twice within lowered twice within 2006 2006

FUTURES MARKETFUTURES MARKET

Transactions with a new instrument such as futures on the GLTB variable Transactions with a new instrument such as futures on the GLTB variable interest rateinterest rate

The development of legal base for the futures market, the formation of The development of legal base for the futures market, the formation of favourable tax policy, and the creation of standards for accounting policy. favourable tax policy, and the creation of standards for accounting policy. InIn 2006 2006, the list of measures aimed at promoting the appeal of this segment , the list of measures aimed at promoting the appeal of this segment was was submitted for the Securities and Lottery Council's considerationsubmitted for the Securities and Lottery Council's consideration. .

RESULTS OF 2006. THE DEVELOPMENT OF RESULTS OF 2006. THE DEVELOPMENT OF TRADE AND SETTLEMENT TECHNOLOGIESTRADE AND SETTLEMENT TECHNOLOGIES

STOCK MARKETSTOCK MARKET

Updating the securities trade system in the directions of interface Updating the securities trade system in the directions of interface development and development and the enhancement of analytical and service functions the enhancement of analytical and service functions

Improving listing procedures in terms of information disclosure and Improving listing procedures in terms of information disclosure and liberalization of securities admission to tradesliberalization of securities admission to trades

The development of new local standard acts aimed at creating a general The development of new local standard acts aimed at creating a general unified legal base for all kinds of securities, as well as widening the range unified legal base for all kinds of securities, as well as widening the range and kinds of operationsand kinds of operations

Defining and testing a new for Belarusian market class of securities such as Defining and testing a new for Belarusian market class of securities such as bank mortgage bondsbank mortgage bonds

Joint efforts together with the Ministry of Finance to abolish 100% Joint efforts together with the Ministry of Finance to abolish 100% reservation of monetary funds for primary government securities distribution reservation of monetary funds for primary government securities distribution purposespurposes and to realize partial reservation mechanismsand to realize partial reservation mechanisms

Cooperation with the National Bank in developing the auction trade methodsCooperation with the National Bank in developing the auction trade methods

THE BCSE ACTIVITY TOTALSTHE BCSE ACTIVITY TOTALS

Total trade volume in 2006 –Total trade volume in 2006 – USD USD 113.283.28 blnblnThe increase to 2005 (in USDThe increase to 2005 (in USD) – ) – 14.214.2 % %

7 279,46

10 004,73

4 336,26

3 274,08

9,62 1,76 0,08 1,420,00

2 000,00

4 000,00

6 000,00

8 000,00

10 000,00

12 000,00

Currency market GS, SNB RB Corporate securities Futures market

Trade volume in 2005-2006, USD mln

2005

2006

TRENDS AND MAIN EVENTS. TRENDS AND MAIN EVENTS.

THE CURRENCY MARKET.THE CURRENCY MARKET.

The exchange currency market total turnover The exchange currency market total turnover – – USD USD 1010..001 bln1 blnThe increase to 2005 (in USD) The increase to 2005 (in USD) – 37 – 37..4 %4 %

YEARYEAR

USDUSD EUREUR RUBRUB Other Other currenciescurrencies TotalTotal

USDUSD

mlnmlnEUREUR mlnmln

USDUSD mlnmln

RUBRUB

mlnmln

USDUSD

mlnmln

USDUSD

mlnmln

USDUSD

mlnmln

20052005 4 760.4 542.2 673.3 51 660.7 1 824.7 21.1 7 279.5

20062006 6 593.7 745.2 940.6 66 420.9 2 454.4 16.0 10004.7

TRENDS AND MAIN EVENTS.TRENDS AND MAIN EVENTS.

THE GOVERNMENT SECURITIES MARKET.THE GOVERNMENT SECURITIES MARKET.

Total volume of operations Total volume of operations –– USD USD 33..0099 blnbln

487,9656,8

2409,7

1854,5

1281

575,9

32,6 0125186,99

1,40,28 8,221,490

500

1000

1500

2000

2500

Primary distribution "Beforeredemption"transactions

"All against all"REPO

REPO auctions STB of NB RB Equities (auctiona,trades)

Bonds (auctions,trades)

Trade volume in 2005-2006, USD in millions

2005

2006


THE GOVERNMENT SECURITIES MARKET.THE GOVERNMENT SECURITIES MARKET.

PRIMARY DISTRIBUTION OF GOVERNMENT SECURITIESPRIMARY DISTRIBUTION OF GOVERNMENT SECURITIES

Number of participantsNumber of participants – 29 ( – 29 (including including 2244 banksbanks)) 275 275 auctionsauctions – (45 - – (45 - primary distribution andprimary distribution and 230 – 230 – additional distribution additional distribution of government securitiesof government securities)) Actual distributionActual distribution – – USD USD 656656..8 8 mlnmln The increase of actual distributions volumes The increase of actual distributions volumes – 34– 34..1 % 1 % inin BYRBYR, , or or 34 34..6 % 6 % inin USD equivalentUSD equivalent Distribution volume at par value Distribution volume at par value – – BYR BYR 1 1 525.525.221313 blnbln The increase ofThe increase of the nominal distribution volume the nominal distribution volume – 31– 31..6 %6 %

SECONDARY CIRCULATION OF GOVERNMENT SECURITIESSECONDARY CIRCULATION OF GOVERNMENT SECURITIES

Secondary market total volume Secondary market total volume –– USD USD 22..43 43 blnbln Number of participants Number of participants – 33 (– 33 (including including 2244 banksbanks))


THE NATIONAL BANK SECURITIES MARKET.THE NATIONAL BANK SECURITIES MARKET.

Total market volumeTotal market volume - - USDUSD 186 186..99 99 mlnmln The increase to 2005 (in USD) The increase to 2005 (in USD) – 50 %– 50 %««All against allAll against all»» REPO operations REPO operations - - USD USD 99.2 mln.2 mln««Before redemptionBefore redemption» » transactions transactions – – USDUSD 177 177..76 76 mlnmln Number of participantsNumber of participants - 17 - 17

1

Р1

Р2

USD 87 mln (2006)

USD 125 mln (2005)

Trade volume in 2005-2006, USD in millionsSTB of NB RB trade volume in 2005-2006, USD in millons

USD 9.2 mln (5%)

USD 77.8mln (95%)

"Beforeredemption"transactions

"All againstall" REPO

TRENDS AND MAIN EVENTSTRENDS AND MAIN EVENTS. .

INDEX OF GS AND SNB RB INDEX OF GS AND SNB RB MARKETMARKET IN IN 2006 2006

104,00105,00106,00107,00108,00109,00110,00111,00112,00113,00114,00

03.0

1.20

06

17.0

1.20

06

30.0

1.20

06

13.0

2.20

06

27.0

2.20

06

14.0

3.20

06

28.0

3.20

06

11.0

4.20

06

25.0

4.20

06

12.0

5.20

06

26.0

5.20

06

09.0

6.20

06

23.0

6.20

06

10.0

7.20

06

24.0

7.20

06

07.0

8.20

06

21.0

8.20

06

04.0

9.20

06

18.0

9.20

06

02.1

0.20

06

16.1

0.20

06

30.1

0.20

06

14.1

1.20

06

28.1

1.20

06

12.1

2.20

06

27.1

2.20

06

GS and SNB RB market index increase GS and SNB RB market index increase to the beginning of the year – to the beginning of the year – 55..18 18 percentage itemspercentage items


THE CORPORATE SECURITIES MARKETTHE CORPORATE SECURITIES MARKET

EquitiesEquities Total trade volume in 2006 Total trade volume in 2006 – – USD USD 0 0..28 28 mlnmln Number of participants -Number of participants - 15 (6 15 (6 banks andbanks and 9 9 broker and dealer broker and dealer companiescompanies)) PrivatizationPrivatization transactions of State transactions of State Property Fund Property Fund – – BYR BYR 2121..5 5 mlnmln

Number of companies whose securities were admitted to trades,

as of January 1, 2007

Quotation List Out-of-list securities Total

А I А II B

1 28 83 40 152

Number of listed companies, whose securities were traded 11

BondsBonds Total trade volume in 2006 Total trade volume in 2006 – – USD USD 1 1..5 5 mlnmln Number of participants - Number of participants - 66 ««All against allAll against all»» REPO operations REPO operations volumevolume – – USD USD 00..34 34 mlnmln ««Continuous double auctionContinuous double auction» » operations volumeoperations volume - - USDUSD 1 1..15 15 mlnmln


THE OTCTHE OTC SECURITIES MARKETSECURITIES MARKET– – purchase and purchase and sale of equities of open-type joint-stock companiessale of equities of open-type joint-stock companies

Total volume of purchase and sale operations in the OTC in 2006 – BYR Total volume of purchase and sale operations in the OTC in 2006 – BYR 3434..7 7 blnbln, , the increase tothe increase to 2005 - 27%, 2005 - 27%, oror USD USD 11..43 43 mlnmln. .

The share of the OTC market segment in the total turnover The share of the OTC market segment in the total turnover – 98 – 98..3% 3% Number of enterprises equities of which were traded in the OTC market Number of enterprises equities of which were traded in the OTC market - - 137137 Number of registered transactions Number of registered transactions – 3 029– 3 029 Number of participants Number of participants – – 38 38

Total volume of local market of JSC equities (purchase and sale transactionsTotal volume of local market of JSC equities (purchase and sale transactions)) including all its including all its componentcomponents s – – BYR BYR 3535..3 3 blnbln. . Number of traded enterprises totalledNumber of traded enterprises totalled. . The following branches of economy provided the maximum volume of operationsThe following branches of economy provided the maximum volume of operations: : FinanceFinance, , creditcredit, insurance, pensions, insurance, pensions Industry of building materialsIndustry of building materials Light industryLight industry

SinceSince 2006 2006,, the BCSE has been empowered to register the BCSE has been empowered to register all kinds of JSC securities all kinds of JSC securities transactionstransactions,, carried out in the OTC marketcarried out in the OTC market


THE OTCTHE OTC SECURITIES MARKETSECURITIES MARKET– – registration registration totalstotals

Kind of operationKind of operation Equities of close-type JSCEquities of close-type JSC Equities of open-type JSCEquities of open-type JSC Bonds of legal entitiesBonds of legal entities

Number of Number of transactiotransactio

nsns

Number of Number of securitiessecurities, ,

mlnmln

VolumeVolume, , BYR mlnBYR mln

Number Number of of

transactitransactionsons

Number of Number of securitiessecurities, , BYR mlnBYR mln

VolumeVolume, , BYR mlnBYR mln

Number of Number of transactiotransactio

nsns

Number Number of of

securitiessecurities, , mlnmln

VolumeVolume, , BYR BYR mlnmln

Purchase and salePurchase and sale 14791479 317317..88 8802888028 30293029 402402..00 3470034700..55 88 938938 47154715..22

DonationDonation 5353 2323..88 344344..3737 672672 33..22 5135132.082.08 -- -- --

Release-moneyRelease-money 11 480480 00..3131 4747 875875..11 299757299757..11 -- -- --

Equities deposition Equities deposition into the capitalinto the capital 11 1010..77 27872787..11 55 216216..88 176166176166..66 -- -- --

Passing of Passing of property according property according to the marriage to the marriage agreement agreement

11 88 88..2424 -- -- -- -- -- --

SwapSwap 22 22..66 161161..9898 33 33..66 20212021..99 -- -- --

AllocationAllocation 11 2020 00..88 -- -- -- -- -- --

Free assignmentFree assignment -- -- -- 11 3702337023 37,0237,02 -- -- --

TotalTotal 15381538 354354..99 91330.891330.8 37573757 150,1150,1 517815,1517815,1 88 938938 47154715..22


THE FUTURES MARKETTHE FUTURES MARKET

Total number of futures transactions in 2006 Total number of futures transactions in 2006 - 30- 30Futures market turnover Futures market turnover – – USDUSD 1 1.4.42 2 mlnmln, , The increase to 2005 (in USD) The increase to 2005 (in USD) – 1675 %– 1675 %Number of participants inNumber of participants in 200 20066 - 6 - 6Number of circulated futures series Number of circulated futures series - 16- 16

INFORMATION AND ANALYTICAL ACTIVITY, INFORMATION AND ANALYTICAL ACTIVITY, MASS-MEDIA AND PUBLIC RELATION, MASS-MEDIA AND PUBLIC RELATION, INTERNATIONAL COOPERATIONINTERNATIONAL COOPERATION. . MAIN EVENTSMAIN EVENTS

International cooperationInternational cooperation membership in the International membership in the International Association of Stock Exchanges of Association of Stock Exchanges of CIS countriesCIS countries, , cooperation between cooperation between the BCSEthe BCSE and leading Exchanges of and leading Exchanges of CIS countries and EuropeCIS countries and Europe Joining the FEASJoining the FEAS ( (Federation of Federation of EuroEuro--Asian Stock ExchangesAsian Stock Exchanges))

Information system developmentInformation system development::1. 1. Information System “Stock Market"Information System “Stock Market" www.stock.bcse.by:: Address change of soft-and hardware Address change of soft-and hardware basebase Creation of new part named “A letter to Creation of new part named “A letter to the specialist”, etc.the specialist”, etc. System update to suit new standard of System update to suit new standard of information disclosureinformation disclosure

2. 2. Corporate website of the BCSE Corporate website of the BCSE www.bcse.by:: New parts for disclosing trade totalsNew parts for disclosing trade totals, , including archivesincluding archives Introduction of market price archiveIntroduction of market price archive disclosure upon GS and SNB RBdisclosure upon GS and SNB RB trade trade totalstotals Update of the on-line modeUpdate of the on-line mode

Mass-mediaMass-media:: organizing and running seminars organizing and running seminars and conferenciesand conferencies publications about the BCSE publications about the BCSE activityactivity cooperation between the BCSE and cooperation between the BCSE and educational institutioneducational institutions of Belaruss of Belarus cooperation between the BCSE cooperation between the BCSE and information agenciesand information agencies ( (REUTERS, REUTERS, BloombergBloomberg, , Echo-PressEcho-Press, , AFN and AFN and othersothers))

TRENDS OF DEVELOPMENTTRENDS OF DEVELOPMENT. .

THE CURRENCY MARKETTHE CURRENCY MARKET

Development of a “fixing” trade mode aimed at favouring work Development of a “fixing” trade mode aimed at favouring work conditions for banks and realization of the rate policy of the National conditions for banks and realization of the rate policy of the National BankBank

Joint work with the National Bank on the development of the legal base Joint work with the National Bank on the development of the legal base that regulates trade rules stipulating introduction of new trade that regulates trade rules stipulating introduction of new trade mechanisms mechanisms («(«double auctiondouble auction» » andand « «call transactionscall transactions») ») and settlement and settlement conditionsconditions

Soft- and hardware realization of new rules for transactions Soft- and hardware realization of new rules for transactions in foreign in foreign currency, proving additional trade and settlement modescurrency, proving additional trade and settlement modes

Updating own legal base regulating mechanisms of concluding and Updating own legal base regulating mechanisms of concluding and executionexecution of transactions in foreign currency of transactions in foreign currency


THE STOCK MARKETTHE STOCK MARKET

Enhancement of service functions of the securities trade system and the Enhancement of service functions of the securities trade system and the increase of its capacityincrease of its capacity

Improvement of admission procedures for securities circulation and Improvement of admission procedures for securities circulation and distribution at the BCSE, development of the software serving these processesdistribution at the BCSE, development of the software serving these processes

Creation of favourable conditions for state-own shares holdings saleCreation of favourable conditions for state-own shares holdings sale

ApprovalApproval and introduction of the soft- and hardware realization of new uniform and introduction of the soft- and hardware realization of new uniform Rules Rules for conducting securities transactions in the BCSEfor conducting securities transactions in the BCSE

Development of mechanisms for government securities primary distributions Development of mechanisms for government securities primary distributions carried out by the Ministry of Financecarried out by the Ministry of Finance

Improvement of auction trade methods providing a wider range of operations Improvement of auction trade methods providing a wider range of operations carried out by the National Bank in the securities secondary marketcarried out by the National Bank in the securities secondary market

Organization of distribution and circulation of new instruments at the BCSEOrganization of distribution and circulation of new instruments at the BCSE


THE FUTURES MARKETTHE FUTURES MARKET

Further Further rangerange extension of financial instruments circulated in the futures extension of financial instruments circulated in the futures marketmarket

Methodological background for Methodological background for delivery futures, world currencies cross-delivery futures, world currencies cross-rates futures, interest rates and government securities market indices rates futures, interest rates and government securities market indices futures introductionfutures introduction

Joint work together with interested authorities aimed at improving the legal Joint work together with interested authorities aimed at improving the legal base regulating base regulating transactionstransactions rules in the futures marketrules in the futures market..

Development of new approaches to guarantee system structure directed at Development of new approaches to guarantee system structure directed at lowering the price of transaction settlementlowering the price of transaction settlement

Improvement of futures instruments trade mechanisms and updating the Improvement of futures instruments trade mechanisms and updating the soft-and hardware complexsoft-and hardware complex


THE CLEARING AND DEPOSITORY ACTIVITYTHE CLEARING AND DEPOSITORY ACTIVITY

Technological background to meet legislative requirements to extend the Technological background to meet legislative requirements to extend the functions of the functions of the Republican Securities Central DepositoryRepublican Securities Central Depository and introduction and introduction of a new and more effective clearing and settlement modelof a new and more effective clearing and settlement model

Technological cooperation between structure elements of the clearing and Technological cooperation between structure elements of the clearing and settlement system in a real time mode using cryptographic settlement system in a real time mode using cryptographic information information protection means and an electronic documentationprotection means and an electronic documentation

Methodological providing of “delivery against payment” OTC operations on Methodological providing of “delivery against payment” OTC operations on the base the BCSE depositorythe base the BCSE depository

Clearing and settlement complex adjustment to new instruments Clearing and settlement complex adjustment to new instruments introduction, to a wider range of operations, and to new auction trade introduction, to a wider range of operations, and to new auction trade methods in the stock market, to be realized in 2007methods in the stock market, to be realized in 2007

Development of new approaches directed at complex servicing issuers and Development of new approaches directed at complex servicing issuers and trade participantstrade participants

TRENDS OF DEVELOPMENTTRENDS OF DEVELOPMENT. . INFORMATION INFORMATION AND ANALYTICAL ACTIVITYAND ANALYTICAL ACTIVITY

The technical base update and the functional enhancement of the BEQAS The technical base update and the functional enhancement of the BEQAS system aimed at increasing its speed and reliability, and applying the system aimed at increasing its speed and reliability, and applying the securities quotation mechanism that corresponds to the standards of OTC securities quotation mechanism that corresponds to the standards of OTC electronic systems functioningelectronic systems functioning

Development of virtual consultations possibilities based on Internet web-Development of virtual consultations possibilities based on Internet web-sites, concerning problems on financial market activitysites, concerning problems on financial market activity

The BCSE Internet system soft-and hardware base updating, database The BCSE Internet system soft-and hardware base updating, database structure optimization aimed at increasing its speed, security and reliability, structure optimization aimed at increasing its speed, security and reliability, as well as introducing technologies that meet modern standardsas well as introducing technologies that meet modern standards

Widening the range of analytical services supported by the development of Widening the range of analytical services supported by the development of indices system reflecting the financial market processes that allows to indices system reflecting the financial market processes that allows to compare certain elements and estimate its future development compare certain elements and estimate its future development


SOFT-AND HARDWARE INFRASTRUCTURESOFT-AND HARDWARE INFRASTRUCTURE

The development of mechanisms of remote access to trades using both the The development of mechanisms of remote access to trades using both the closed corporate net of the BCSE and the Internetclosed corporate net of the BCSE and the Internet

Improvement of service functions of trade participants` and their clients` Improvement of service functions of trade participants` and their clients` workstationsworkstations

Introduction of cryptographic Introduction of cryptographic protection means and an electronic documentationprotection means and an electronic documentation systemsystem

Updating the electronic trade system and clearing and settlement system in the Updating the electronic trade system and clearing and settlement system in the stock and futures marketstock and futures market

Software development for automation of the BCSE Internet resources and the Software development for automation of the BCSE Internet resources and the BEQAS system modification processesBEQAS system modification processes

Program development for statistics enumeration, ranging and analysis upon the Program development for statistics enumeration, ranging and analysis upon the trade totals and the information provided by issuers and trade participantstrade totals and the information provided by issuers and trade participants

The whole hardware complex update in 2007 will provide the reliability of all soft- and The whole hardware complex update in 2007 will provide the reliability of all soft- and hardware means of the BCSE, contributing tohardware means of the BCSE, contributing to::


NEW MARKETSNEW MARKETS

Such new segment of the organized market as credit resources market is planned to Such new segment of the organized market as credit resources market is planned to be formed in 2007, starting with the development of the local legal basebe formed in 2007, starting with the development of the local legal base

Main advantagesMain advantages::

Developing mechanisms for short-term distribution of temporary free Developing mechanisms for short-term distribution of temporary free floats and organization of deposit and credit auctions to attract necessary floats and organization of deposit and credit auctions to attract necessary funds on a competitive basisfunds on a competitive basis

Promoting interbank credit market development in terms of simplifying Promoting interbank credit market development in terms of simplifying procedures for funds redistribution between banks with surplus resources procedures for funds redistribution between banks with surplus resources and deficient ones. and deficient ones.

Contributing to the development of new mechanisms for settlement risk Contributing to the development of new mechanisms for settlement risk management in the organized financial market, maintaining the liquidity of management in the organized financial market, maintaining the liquidity of clearing participants by introducing credit proceduresclearing participants by introducing credit procedures

Belarusian Currency and Stock Exchange Activity Report 2006.

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Transcript of Belarusian Currency and Stock Exchange Activity Report 2006.