Copyright© JSE Limited JSE – Africa’s premier exchange JSE Release C Market Communication NOTEA October 2007 Leanne Parsons

© 2 Release C Agenda Market dress rehearsal feedback User readiness and further training Action plan Timelines JSE network access switch upgrade Questions

© 3 The JSE would like to thank you for your participation and support in the recent Orion Release C dress rehearsal. Dress rehearsals of the magnitude conducted on Saturday 29 September 2007 provide the JSE with the opportunity to identify unique scenarios and market interactions which are very difficult to otherwise simulate. Market Dress Rehearsal Feedback Thank you

© 4 Market Dress Rehearsal Feedback (Cont) Statistics: MDR 29 September 2007 APD Market 232 Users connected (15% less than on a production day) 58 Members and Clearing Members connected 6783 orders entered on all contracts (20% more compared to a 3 hour production day) 5000 Deal and Order Management Operations 4134 deals equating to contracts entered (100% more compared to a 3 hour production day – the volume of contracts traded is not realistic) EDM Market 276 Users connected (100% participation compared to a production day) 74 Members and Clearing Members connected 5473 orders entered on all contracts (100% more compared to a 9 hour production day) More than 6000 Deal and Order Management Operations The number of deals on EDM could not be accurately measured as all deals done on the December 2007 ALSI had to be deleted at the Exchange due to unrealistic contract volumes being traded (in excess of contracts per trade) 5 Information Subscribers connected to both markets

© 5 Market Dress Rehearsal Feedback (Cont) Positives Reasonable Market Participation (80% of members & 90% of users logged on) Customers completed checklist and returned timeously Customers ensured own technical assistance was onsite Various technical issues highlighted EOD balancing with Clearing Members for AD EOD files successfully generated via IDS Auto quote functionality tested with Equity Market real time data

© 6 Market Dress Rehearsals Feedback (Cont) Issues Identified Issues found during the MDRJSE Findings and Progress Performance issues experienced throughout dress rehearsal by both markets Excessive re-requests and unrealistic deals resulted in queue build-ups. This resulted in the ED Market failing at 11:15 and the AD Market failing at 12:11 Monitoring tools also identified areas where performance improvements could be made. Deals done on the EDM market included trades of contracts per deal which resulted in problems encountered at the JSE when performing the End of day Clearing processes

© 7 Market Dress Rehearsals Feedback (Cont) Issues Identified Issues found during the MDRJSE Findings and Progress Downloading issues Downloads were a general problem on the day, this was picked up as the JSE has monitoring tools which look at various levels of performance, it was found that several dealers were logging in excessively. One dealer in particular logged in over 300 times within a short time frame, in future this will not be allowed to happen. API issues with placing orders for other members Validation check on the reported member was not configured, this has been corrected.

© 8 Market Dress Rehearsals Feedback (Cont) Issues Identified Issues found during the MDRJSE Findings and Progress Issues with sub-accountsToday the JSE does not manage sub- accounts and converted what was in our clearing environment. We are investigating converting from the ATS files- will have an agreed solution by go-live. Balancing at EODDeal of over 1 million contracts was put through causing EOD issues. While we asked for realistic trades, we will be encouraging members to set their limits prior to future tests. Issues logged by Users which are as a result of users not familiar with the new functionality JSE requests that users attend refresher training courses. Eg (can see each others active orders, use of principle and agency, re-allocations, the number ‘1’ in client codes etc.)

© 9 Market Dress Rehearsals Feedback (Cont) Issues Identified Issues found during the MDRJSE Findings and Progress Certain functionality, such as Active Orders and Deal Management failed on the day - canceling, suspending, reducing active orders, adding deals, problems with report only deals, accepting deals. We believe that majority of these functionality failures were due to performance related problems on the day, as this functionality had been tested and proved to work in the internal and external test environments. Once the JSE technical team has resolved the performance issues we will retest and prove all functionality under the same conditions experienced during the DR by simulating the market using additional specialised tools. Excessive re requests - bug in information vendor software caused excessive re requests which added to the performance and technical problems experienced on the day JSE technical team is investigating how the system can handle excessive re requests and be more robust in the face of similar ‘rogue’ software problems. Message sequence numbers and re requestsJSE technical team investigating whether the re- requesting process can be improved/streamlined and whether a change is required to the how the message sequencing works.

© 10 User Readiness and Further Training Some communication issues were identified during the MDR – these will be resolved prior to the next DR. Users were identified who did not understand the functionality of the new JSE supplied application. The JSE therefore encourages users to log onto the external test environment to familiarise themselves with the functionality. A possible refresher course on the JSE supplied front end is being considered before the next major DR. The User Readiness team will continue communicating on a regular basis on the status of the project.

© 11 Action Plan Next steps Short term plan to focus on the following activities: −Correct remaining functional issues – 3 weeks −Regression test software – 2 weeks −Technical Integration Test (TINT) preparation – 3 weeks −TINT on software that has passed regression test – 4 weeks External User Testing, including Clearing Member parallel runs, to continue once Functional regression testing has been completed

© 12 Action Plan (Cont) Next steps Once functional regression testing and TINT is complete, the following milestones are planned : −Further end to end regression testing −A voluntary mini dress rehearsal for APD −Voluntary dress rehearsal for both markets −Refresher training courses −Combined compulsory dress rehearsal −Parallel run on AD and ED markets prior to go live −Go live

© 13 Timelines The JSE will only provide new dates for DR’S for the Agricultural and Equity Derivatives markets after certain key milestones have been met. We will also commit to providing at least 4 weeks notice of these dates and six weeks notice for Go-Live dates. We would also like to request that users of the Agricultural Derivatives market and the Equity Derivatives market RESERVE the dates earmarked in the original schedule to assist the JSE in in potential testing as follows: MonthDay November24 December01

© 14 JSE Network Access Switch Upgrade The JSE has been conducting detailed analysis into two current known local network problems impacting Equity Market participants. The two problems are as follows:- −a small number of multicast messages are being dropped, and −a small number of multicast messages are being delivered out-of- sequence The recommended solution by our network router manufacturer, CISCO, to address these two problems requires an upgrade to the operating system software of the Switch and Firewall devices which govern all connectivity access to the JSE network. Due to the associated high risk and impact of this change to all member access, the JSE could only consider implementation of this upgrade after the September 2007 Futures Closeout. For this reason the first opportunity is to do this will be on Saturday 27 October 2007.

© 15 JSE Network Access Switch Upgrade (Cont) Technical User participation is required in proving this change but the benefits to the market far outweigh the inconvenience of Saturday testing. All users connecting via the JSE Hub must participate in this test. Please forward the primary contact details for the testing to Alex Naicker via or

© 16 Please refer all derivative queries to Questions?

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