WARSAW STOCK EXCHANGE THE BIGGEST DERIVATIVES MARKET IN THE CEE REGION WARSAW STOCK EXCHANGE THE BIGGEST DERIVATIVES MARKET IN THE CEE REGION AN OPPORTUNITY FOR YOU June 2011

WSE – LARGEST EXCHANGE IN THE CEE REGION Euro bn Source: FESE DOMESTIC COMPANIES CAPITALIZATION (March 2011)

WSE – LARGEST EXCHANGE IN THE CEE REGION Source: WSE, FESE NUMBER OF COMPANIES LISTED (March 2011)

WSE – LARGEST EXCHANGE IN THE CEE REGION Source: WSE, FESE NUMBER OF FOREIGN COMPANIES LISTED (March 2011)

WSE – LARGEST EXCHANGE IN THE CEE REGION Euro mil. Source: FESE VALUE OF EQUITY TRADING 2010

Euro mil. WSE – LARGEST EXCHANGE IN THE CEE REGION Source: FESE VALUE OF EQUITY TRADING (January – March 2011)

51 exchange members (including 23 remote members) equity market capitalisation (as of end of Q1 2011): EUR bn (domestic companies) EUR 71 bn (foreign companies) equity market value traded in EUR 81 bn, 2009 – EUR 85 bn, Q – EUR 21 segments of regulated market: 250 PLUS – 19%*, 50 PLUS – 29%, 5 PLUS – 49%, 5 MINUS – 3% WSE - BASIC CHARACTERISTICS – CASH MARKET AVERAGE DAILY TRADING FIGURES - EQUITY MARKET in orders trades EURO 467 million - average daily equity turnover value * Means the percentage of listed companies belonging to a given segment.

WIG20 INDEX PERFORMANCE

WSE REMOTE MEMBERS Countries of origin: Austria, Bulgaria, Cyprus, Czech Republic, Estonia, France, Germany, Hungary, Slovak Republic, Sweden, UK

STRUCTURE IN 2010 Retail; 19% Institutional; 34% Foreign; 47% STRUCTURE IN TRADING 2005 – H Foreign Institutional Retail INVESTORS ON WSE EQUITIES TRADING BY INVESTORS’ TYPE (MAIN LIST) The share of foreign investors in stock trading was 47%, the share of institutions 34%, and the share of retail investors 19% in 2010; The share of foreign investors grew from 36% in 2009 to 47% in 2010.

INVESTORS ON WSE MUTUAL AND PENSION FUNDS Sources: PFSA PENSION AND MUTUAL FUNDS Assets Under Management (EUR bn) Open Pension Funds Mutual Funds

BASIC CHARACTERISTICS OF THE DERIVATIVES MARKET Order-driven, electronic continuous trading with auctions at the opening and at the closing Derivatives trading: 8.30 a.m p.m. Clearinghouse - National Depository for Securities (NDS) Liquidity supported by market makers

FROM A LOCAL EMERGING MARKET TO A CEE LEADER

TRADED DERIVATIVES - UNDERLYINGS FUTURES - indices (WIG20, mWIG40) - single stocks - 11 underlyings (Asseco Poland, KGHM, PEKAO, PGE, PGNIG, PKN Orlen, PKO BP, PZU, TPSA, TPE, LTS) – 11 out of 20 WIG20 companies, the biggest, most liquid - currencies (USD/PLN, EUR/PLN, CHF/PLN) OPTIONS WIG20 index options (european call & put) IPUs – MiniWIG20

BLOCK TRADES ON DERIVATIVES BLOCK TRADES introduced in 2006 October for all futures & options registered off session trades same fees, margin as regular trading in the order book have defined minimum & maximum volumes: WIG20 futures - min. 200 contracts, max contracts WIG20 options – min 200 contracts, max contracts

RISING VOLUMES Volume (mil. contracts) Open interest (th contracts) DERIVATIVES – VOLUME & OPEN INTEREST

Turnover volume in index futures on EU exchanges No.Exchange Turnover v olume in contracts EUREX Liffe NYSE Euronext OMX WSE SPAIN ITALY NORWAY GREECE HUNGARY AUSTRIA CZECH REPUBLIC462 WSE NO. 4 in 2010

Turnover volumes of futures contracts on particular European Indices – top 15 contracts WIG20 FUTURES NO. 6 in Q No.ExchangeIndex Turnover v olume in contracts Q EUREXEURO STOXX Liffe NYSE EuronextCAC EUREXDAX Liffe NYSE EuronextFTSE OMXOMXS WSEWIG EUREXSMI Liffe NYSE EuronextAEX SPAINIBEX NORWAYOBX ITALYFTSE MIB SPAINIBEX 35 MINI GREECEFTSE/ATHEX ITALYMini FTSE MIB HUNGARYBUX

DERIVATIVES – SOME STATISTICS 2011 January - April, volumes - WIG20 index futures th - single stock futures- 222 th - currency futures- 38 th - WIG20 options- 335 th - Participation units- 10 th 2011, end of April, no of open interest - WIG20 index futures- 123 th - single stock futures- 9.9 th - currency futures- 3.4 th - WIG20 options- 107 th - Participation units- 14 th

STRUCTURE IN 2010 Retail 50% Foreign 14% Institutional 36% the share of institutional and foreign investors in futures trading has grown steadily since 2005 STRUCTURE IN TRADING Foreign Institutional Retail FUTURES BY INVESTORS’ TYPE

market participation of the foreign investors in 2010 hit record high – 14% number of futures contracts traded by the foreign institutions amounted to 1,8m British brokers on the lead in terms of option trading Austria 14% France 4% Other 18% United Kingdom 64% STRUCTURE IN H FOREIGN INVESTORS TRADING FUTURES

DOMESTIC INSTITUTIONS TRADING FUTURES STRUCTURE IN H Market makers 61% Other 6% Dealers 16% Investment funds 17% market share of the domestic financial institutions in 2010 dropped slightly to 36% institutional investor’s volume in 2010 amounted to 4,8 mln the most active among the institutional investors are market makers investment fund’s activity fell by 6 percentage points (23% market share in 2009 within the group of institutional investors)

STRUCTURE 2010 Retail 60% Foreign 12% Institutional 28% the share of retail investors has decreased steadily in the past years with the exception of 2009 when the market share increased by 7 percentage points OPTIONS TRADING BY INVESTORS TYPE STRUCTURE IN TRADING Foreign Institutional Retail

share of foreign institutional investors went up to 12% trading volume made by the offshore institutions in 2010 was higher than the volume from the previous year by 380% British brokers are also on the lead in terms of option trading FOREIGN INVESTORS TRADING OPTIONS Austria 9% United Kingdom 72% STRUCTURE IN H Other 19%

DOMESTIC INSTITUTIONS TRADING OPTIONS market share of the domestic institutional investors dropped to 28% instititution turnover in 2010 amounted to 189k leading role of market makers with respect to option trading banks and market makers responsible for 94% of trading volume STRUCTURE IN H Banks 9% Other 3% Investment funds 5% Market makers 83%

NEW DERIVATIVES New single stock futures: - Tauron (TPE) – December Lotos (LTS) – May 2011 Currency futures: Shorter maturities added - 1 & 2 closest months

SHORT SELLING AT WSE Available securities: a)shares participating in WIG20 index, b)shares with: - the average daily value of trading (last 6 months) higher than PLN 4 mio - value of free-float shares at least equal to PLN 300 mio, c)shares whose free-float value on the first day of trading represents or represented at least 1% of the value of free-float shares of all companies participating in the shares liquidity ranking, d)Treasury Bonds.

SHORT SELLING AT WSE WSE publishes two lists of securities available for short sale: 1)Securities available for clients’ and dealers’ orders - more than 30 securities 2)List of securities available for market makers short sale orders securities Lists published on a daily basis. Standard changes to the list (other special ones) 8 times a year: - after 7 th February; after the third Friday of March; after 7 th May; - after the third Friday of June; after 7 th August; - after the third Friday of September; - after 7 th November; after the third Friday of December

SHORT SELLING AT WSE Short sale orders must be flagged Accepting of short sale orders may be suspended (by WSE) in case of: a)significant increase in settlement risk – information from the National Depository (KDPW), b)significant decrease in the value of the WIG index (-3%)/price of individual shares (-10%) during a trading session in combination with a high share of the value of trading in short sale transactions in the value of trading in all transactions on the market (more than 20%) c)if required by the safety of exchange trading, on request of the Polish Financial Supervision Authority In case a) and c) short sale may be suspended for: specific securities, all securities (orders from a specific Member), specific securities (orders from a specific Member).

SHORT SELLING AT WSE WSE publishes information on short sale transactions in real time. After the closing of a trading session, for all securities available for short sale orders, WSE publishes information: - about the cumulative volume, - value of trading, - number of short sale transactions. The information is published via: - the electronic information distribution mechanisms, - the Exchange website, - the Exchange Daily Bulletin (Ceduła), See more: -> Investor Centre -> Short selling and securities lending Ask questions:

ETF on WIG20 Issuer - LYXOR AM Traded in PLN only at WSE Value 1/10 index – around 250 PLN Continuous trading ( ) as for shares Liquidity provided by market makers Creation/redemption similar to other ETFs

SOON ON THE WSE Introduction of single stock options (due to short selling) NDS becomes CCP in 2Q Remote Clearing in 3Q 2011 UTP - new trading system: new functionalities for derivatives

STRUCTURED PRODUCTS AT WSE 2006 August – first instrument, Deutsche Bank London bond, ‘db Magic Three’, 2007 March - first certificate, tracking NTX price index, by ERSTE Bank, Raiffeisen Centrobank (RCB) – the biggest no of products since Sept 2007: open-end certificates, different underlyings: basket of shares, indices (DAX; DJ EuroSTOXX50; NIKKEI225, NASDAQ) and commodities (brent crude, gold, silver), 2010 summary: value of trading PLN 286 million (+82% comp. to 2009), volume 6.7 million, 7 issuers, 95 new products 2011 (Jan – Apr) – 16 new products 2011 April – 148 traded instruments 27 bonds – Barclays Bank, SecurAsset 121 certificates – RCB, Deutsche Bank, UniCredit Bank AG, Erste Bank, BNP Paribas. Ask questions:

COUNTRY OF ORIGIN OF STRUCTURED PRODUCTS ISSUERS ON THE WSE

STRUCTURED PRODUCTS AT WSE bonds certificates

Krzysztof Mejszutowicz Head of Derivatives Team Market Development Department Warsaw Stock Exchange phone: or Mobile: Web information: Questions: CONTACT