1 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Presentation Dead Sea, October 25 th 2007 Samir Jaradat CEO Overview

2 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Foundation  Fundamentally Sound Building Blocks  Quality Materials  Constructed According to Standard Code Materials  Legislative Blocks: Strong & Dynamic Rule of Law  Regulatory Blocks: Securities Regulator  Technical Blocks: Robust & Globally Compliant Technology Systems  Operational Blocks: Exchange, Registry & Depository Construction Blocks

3 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Public utility institution Established in the Kingdom by virtue of the Securities Law A legal entity with financial & administrative autonomy Subject to the Jordan Securities Commission’s monitoring & supervision Commenced operation in May 1999 Establishment

4 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Goals & Objectives Enhance the confidence of investors in securities & enable them to follow-up their investments in securities with ease by establishing a central registry to safe-keep the ownership of securities Reduce risks related to settlement of trading transactions executed through the Market by implementing by-laws, instructions & procedures that are fair, fast & safe

5 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Functions & Responsibilities Unique identification number for investors Central registry system Central depository system Safekeeping via Book-Entry Registered ownership Centralization of ownership restrictions Authenticated corporate actions Clearing & settlement Account level structure

6 Copyright © Securities Depository Center, Jordan. All Rights Reserved. ● Delivery-versus-Payment basis where delivery of sold securities is against payment of their value ● All cash transfers related to settlement are effected between the SDC’s settlement account at the CBJ & the brokers accounts at their commercial banks through the RTGS-JO on T+2, with same-day value ● The RTGS-JO is a central real time, gross final & irrevocable electronic settlement system ● The transfer of funds & securities occur simultaneously on an irrevocable basis on Settlement Date (T+2) Clearing & Settlement

7 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Risk Management Markets have procedures, rules & regulations to protect market-participants from loss to assure the smooth functioning of the market & to maintain the confidence of investors Settlement Guarantee Fund  Separate legal entity with financial autonomy  Fund membership is compulsory for brokers & dealers Settlement cap for market participants commensurate with posted collaterals Settlement bank Buy-in & sell-out measures Immediate suspension of trading for defaulting brokers Strict licensing protocol for market participants (Zero Tolerance)

8 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Risk Management Unbiased corporate governance Transparent, automated information dissemination Established business continuity & contingency plans Robust risk controls in the SDC operations Movements are final & irrevocable (zero failed trades) Compliance to G30 recommendations & best practices State of the art Electronic Systems SCORPIO ®  Clearing & Settlement System  Registry System Securities & Funds Shareholder Ownership Registry Delivery versus Payment Authentication of Ownership Final & Irrevocable Settlement Non-Trade Transfers (OTC)

9 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Investment Made Secure ● Regulation  Sound regulatory framework & binding enforcement, with continued progress ● Accessibility  Jordan Capital Market is open to all international investors Repatriation of capital  No restrictions on repatriation of funds into or out of Jordan Taxation  No capital gains tax, this includes cash & stock dividends Currency  The unit of currency in Jordan is the Jordanian Dinar (JOD), & the JOD exchange rate is pegged to US Dollar ● Registration  No physical certificates  Dematerialized shares  Settlement is effected on the basis of Delivery versus Payment  Ownership is updated on T+2 & backdated to T

10 Copyright © Securities Depository Center, Jordan. All Rights Reserved. ● Ownership  Registered under the name of beneficial owner name  Nominee & street names does not apply Execution Local brokers execute in the name of  Beneficial owner  International broker Accounts  Depository Account  Custody Account  Trading Accounts  Segregated Securities Accounts ● Settlement Cycle  T+2 rolling settlement with multilateral netting ● Settlement Method  Book-entry at the SDC Investment Made Secure

11 Copyright © Securities Depository Center, Jordan. All Rights Reserved. ● Cash & Clearing system  Payments are processed through the "Real Time Gross Settlement System-Jordan" (RTGS-JO), using SWIFT instructions to effect transfers with immediate value Blocking  Securities are blocked in the buyer’s & seller’s accounts on T+0 pending successful cash settlement on T+2 Turnaround Trades  Allowed, provided the same broker is used in the same settlement cycle Numbering  ISIN CODE  CFI CODE Overdraft Restrictions  Overdraft facility in Jordan can be offered to foreign investors for a period not exceeding 15 days for settlement purposes Corporate actions  Voluntary (Right Issue, Tender Offer)  Non-voluntary (Dividends, Bonus, Stock split, … etc) Investment Made Secure

12 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Cooperation with Regional & International Organizations ● International Organization of Securities Commissions (IOSCO) ● World Federation of Euro-Asian Stock Exchanges (FEAS) ● Association of National Numbering Agencies (ANNA) ● Union of Arab Stock Exchanges ● Africa & Middle East Depositories Association (AMEDA) ● 9th Conference of Central Securities Depositories (CSD9) ● Association of Global Custodian ● Thomas Murray

13 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Vision ● Build World-Class Depository in the Middle East ● Book-entry Clearing & Settlement ● Implement True Delivery-versus-Payment (DvP) ● Adhere to best International Standards & Practices ● Contribute to Better & Enhanced Surveillance ● Introduce Risk Management Measures ● Promote Domestic & Foreign Indirect Investment in Jordan

14 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Introduction to Securities Lending e-Payment System Advanced Accounting System Order Verification (Tight Coupling) SCORPIO ® Web-Enabled Revise By-Laws In ProgressPlanned Future Plans Electronic Initial Public Offering e-IPO Members’ Area Some Required Enhancements  Disaster Recovery Site  Business Continuity Plan  Membership Structure  SCORPIO ® System Advanced Settlement System Develop value added services Bonds Processing

15 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Vote of Confidence JORDAN

16 Copyright © Securities Depository Center, Jordan. All Rights Reserved. Thank You