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

1Copyright © Securities Depository Center, Jordan. All Rights Reserved.

PresentationDead Sea , October 25th 2007

Samir JaradatCEO

Overview


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


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


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


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


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)


Risk Management

Unbiased corporate governanceTransparent, automated information disseminationEstablished business continuity & contingency plansRobust risk controls in the SDC operationsMovements 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)


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


● 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



● 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)



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


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


Introduction to Securities Lending

e-Payment System

Advanced Accounting System

Order Verification (Tight Coupling)

SCORPIO® Web-Enabled

Revise By-Laws

In Progress Planned

Future Plans

Electronic Initial Public Offering e-IPO

Members’ Area Some Required Enhancements

Disaster Recovery Site Business Continuity PlanMembership StructureSCORPIO® System

Advanced Settlement SystemDevelop value added servicesBonds Processing


Vote of Confidence

JORDAN


Thank You

www.sdc.com.jo

Documents

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