KAZAKHSTAN STOCK EXCHANGE (KASE) December 1, 2008

KAZAKHSTAN STOCK EXCHANGE (KASE)

December 1, 2008

COEVAL OF TENGE …

KASE was established on November 17, 1993 under the name of Kazakh Inter-bank Currency Exchange – two days after Tenge (the new national currency of Kazakhstan) had been introduced on November 15, 1993.

Currently, November 15 is observed as the official "Day of National Currency".

"New" tenge (since 2006)

"Old" tenge (1993–2006)

NOW COMMERCIAL

KASE is a commercial joint-stock company with 71 shareholders (as of December 1, 2008).

Regional Financial Center of Almaty JSC is the largest shareholder. Shareholders include banks, brokerage firms, asset management companies, pension funds and other professional financial institutions.

Voting method: one share – one vote.

THE SIZE MATTERS

As of November 1, 2008

own capital $10.6 m

paid up charter capital $1.4 m

authorized shares 5,000,000

outstanding shares 450,000

share balance value 2,732 tenge($22.9 )

SO DOES THE PROFIT

assetsnet

profitreturn

on assetsreturn

on equity

2007 $11.9 m $1.8 m 17.8 % 20.2 %

2006 $8.3 m $2.2 m 32.5 % 34.3 %

2005 $5.2 m $1.3 m 29.0 % 30.4 %

The total of members – 99 of which:

WE ARE BIG IN NUMBERS

Category "A" (with the right to trade in all financial instruments circulating on the special trading floor of the Regional Financial Center of Almaty) – 53;

Category "B" (with the right to trade in foreign currency) – 30;

Category "C" (with the right to trade in futures) – 6;

Category "K" (with the right to trade in government securities) – 85;

Category "P" (with the right to trade in corporate serial securities listing on KASE) – 85;

Category "H" (with the right to trade in corporate serial securities admitted to circulation (trading) in sector “Unlisted securities" of the KASE Trading system, and state-owned shareholding of organizations being privatized) – 50.

WE MAKE THE HISTORY (1)

1993 – first trades in foreign currency (US dollars)

1995 – first trades in T-bills

1996 – first trades in derivatives (KZT/USD exchange rate futures)

1997 – first trades in listed shares

1997 – first trades in state-owned shareholding

1997 – first trades in unlisted corporate securities

1998 – launch of KASE "nego" deals system (substitution of over-the-counter securities market )

1998 – first trades in euro bonds of Kazakhstan


1999 – first trades in listed bonds

1999 – first trades in municipal bonds (such bonds were prohibited for issue in 2005)

1999 – launch of "nego" repo market

2001 – launch of "automatic" repo market (currently most massive and active sector of KASE market)

2006 – first trades in foreign corporate bonds (JP Morgan and Merrill Lynch)

2006 – IPO of KazMunaiGas Exploration Production shares using KASE settlement system


2006 – KAZAKHMYS PLC (UK) secondary share offering by subscription through KASE

2007 – special trading floor of the Regional Financial Center of Almaty city established on the base of KASE (to attract foreign issuers and investors)

2007 – launch of new share market index – KASE Index, continuing numerical series of KASE_Shares Index

2007 – KASE commercialization

2008 – implementation of new listing rules, reconstruction of unity through integration of MTF KASE and STF RFCA

2008 – first trades in affined ingot gold futures

KASE – UNIVERSAL MARKET (1)

Repo (money) market constitutes for 61.9 % of KASE total turnover

33.7 %

8.0 %

49.4 %

3.8 %

Nego repo in corporate securities, USD11,689.9 m

Auto repo in government securities,

USD150, 426.8 m

Shares, USD3,302.4 (1.1 %)

Government securities, USD6,754.5 m (2.2 %)

Auto repo with corporate securities, USD24,423.8 m

Nego repo with government securities, USD2,030.4 m (0.7 %)

Currency,USD102,620.3 m

In 11 months of 2008:

304,485.5USD m

Corporate bonds, USD3,236.9 m (1.1 %)

Repo (money) market constitutes for 61.9 % of KASE total turnover

33.7 %

8.0 %

49.4 %

3.8 %

Nego repo in corporate securities, USD11,689.9 m

Auto repo in government securities,

USD150, 426.8 m

Shares, USD3,302.4 (1.1 %)

Government securities, USD6,754.5 m (2.2 %)

Auto repo with corporate securities, USD24,423.8 m

Nego repo with government securities, USD2,030.4 m (0.7 %)

Currency,USD102,620.3 m

In 11 months of 2008:

304,485.5USD m

Corporate bonds, USD3,236.9 m (1.1 %)

KASE serves a wide range of markets: "nego" and "automatic" repo with government and corporate

securities foreign currency (US dollar, euro, Russian ruble)government securities issued by the National Bank, Ministry of

Finance (including Kazakhstan international bonds) and local district authorities of Republic of Kazakhstan

IFO bonds and foreign government securitiespromissory notesequities corporate bonds

KASE – UNIVERSAL MARKET (2)

"regular" domestic bonds (nominated in tenge or foreign currency, discount or coupon, with fixed or floating interest)

international bonds of Kazakhstan issuersagency bonds (with tax regime same as that for government

securities) infrastructural bonds (collateralized by government guarantee)bonds of foreign issuers (prior registered outside Kazakhstan)

A GREAT VARIETY OF BONDS

TURNOVER DYNAMICS (USD bn)

0

50

100

150

200

250

300

350

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 01.12.08

Repo

Corporate securities

Public securities

Derivatives

Currencies 169.3

322.5304.5

0

50

100

150

200

250

300

350

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 01.12.08

Repo

Corporate securities

Public securities

Derivatives

Currencies 169.3

322.5304.5

TURNOVER and GDP

0

50

100

150

200

250

300

350

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 01.12.08

0

50

100

150

200

250

300

350

KASE, USD bn.

% to GDP

GDP, USD bn.

308.6 %

0

50

100

150

200

250

300

350

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 01.12.08

0

50

100

150

200

250

300

350

KASE, USD bn.

% to GDP

GDP, USD bn.

308.6 %

MARKET CAPITALIZATION

0

10

20

30

40

50

60

70

80

90

100

2001 2002 2003 2004 2005 2006 2007 2008

Shares

0

2

4

6

8

10

12

14

16

2001 2002 2003 2004 2005 2006 2007 2008

Corporate bonds

as of December 1, 2008 –USD32.0 bn.


0

10

20

30

40

50

60

70

80

90

100

2001 2002 2003 2004 2005 2006 2007 2008

Shares

0

2

4

6

8

10

12

14

16

2001 2002 2003 2004 2005 2006 2007 2008

Corporate bonds



LISTED COMPANIES

17 2332

4968

7994

114126

143

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

TOTAL

17 1721

54

62

82

69

25

40

68

101

89

1

78564545

36

1122

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Shares

Corporate bonds as ofDecember 1

as ofDeсember 1

17 2332

4968

7994

114126

143

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

TOTAL

17 1721

54

62

82

69

25

40

68

101

89

1

78564545

36

1122

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Shares

Corporate bonds as ofDecember 1

as ofDeсember 1

SECURITIES OF OFFICIAL LIST

29 40 5788

129174

235

295

370

2000 2001 2002 2003 2004 2005 2006 2007 2008

TOTALas of

December 1

9078

107

4261

93

332728

263

1

202

145

9668

4613 24

2000 2001 2002 2003 2004 2005 2006 2007 2008

Shares

Debt securities

as of

December 1

29 40 5788

129174

235

295

370

2000 2001 2002 2003 2004 2005 2006 2007 2008

TOTALas of

December 1

9078

107

4261

93

332728

263

1

202

145

9668

4613 24

2000 2001 2002 2003 2004 2005 2006 2007 2008

Shares

Debt securities

as of

December 1

OFFICIAL LIST INDUSTRIAL STRUCTURE

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2000

2001

2002

2003

2004

2005

2006

2007

01.1

2.08

Energy/powerengineeringFinance

TelecommunicationservicesRaw materials sector

Industry

Main consumer sector

Public sector

Information technology

Health protection

Discretionary consumersector

Shares

2000

2001

2002

2003

2004

2005

2006

2007

01.1

2.08

Corporate bonds

Global Industry Classification Standard (GICS) of S&P has been used

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2000

2001

2002

2003

2004

2005

2006

2007

01.1

2.08

Energy/powerengineeringFinance

TelecommunicationservicesRaw materials sector

Industry

Main consumer sector

Public sector

Information technology

Health protection

Discretionary consumersector

Shares

2000

2001

2002

2003

2004

2005

2006

2007

01.1

2.08

Corporate bonds

Global Industry Classification Standard (GICS) of S&P has been used

SHARE AND BOND LIQUIDITY PARAMETERS

KASE total turnover for 11 months of 2008 in shares – USD3,302.4 m.,in corporate bonds – USD3,236.9 m.

3,2

4,1

3,3

8,9

0

1

2

3

4

5

6

7

8

9

10

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Dec.2008

Corporate bonds

Shares

Turn

over

, USD

bn.

KASE total turnover for 11 months of 2008 in shares – USD3,302.4 m.,in corporate bonds – USD3,236.9 m.

3,2

4,1

3,3

8,9

0

1

2

3

4

5

6

7

8

9

10

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Dec.2008

Corporate bonds

Shares

Turn

over

, USD

bn.

SHARE AND BOND LIQUIDITY PARAMETERS

KASE average daily turnover for 11 months of 2008 in shares – USD14.4 m.,in corporate bonds – USD14.0 m.

0

20

40

60

80

100

120

140

160

2004 2005 2006 2007 2008

SharesCorporate bonds

Daily

turn

over

, USD

m.

KASE average daily turnover for 11 months of 2008 in shares – USD14.4 m.,in corporate bonds – USD14.0 m.

0

20

40

60

80

100

120

140

160

2004 2005 2006 2007 2008

SharesCorporate bonds

Daily

turn

over

, USD

m.

MAIN CHALLENGES OF THE MARKET

• lack of free-float equities (the heritage of case-by-case privatization)

• conservative policy of the main domestic investors ("buy bonds and hold till maturity")

KASE INDEX

2,856

(19.07.07)

2,387

(20.08.07)

1,589

(05.06.06)

2,808

(12.02.07)2,394

(19.04.06)

2,858

(21.02.08)

960

(28.11.08)

0

700

1400

2100

2800

3500

4200

01

.01

.05

01

.04

.05

01

.07

.05

01

.10

.05

01

.01

.06

01

.04

.06

01

.07

.06

01

.10

.06

01

.01

.07

01

.04

.07

01

.07

.07

01

.10

.07

01

.01

.08

01

.04

.08

01

.07

.08

01

.10

.08

01

.01

.09

0

50

100

150

200

250

300

KASE Index

Market share deals volume, USD m.

682.0

216

(05.01.05)

689.3

503.3 391.6507.4

2,856

(19.07.07)

2,387

(20.08.07)

1,589

(05.06.06)

2,808

(12.02.07)2,394

(19.04.06)

2,858

(21.02.08)

960

(28.11.08)

0

700

1400

2100

2800

3500

4200

01

.01

.05

01

.04

.05

01

.07

.05

01

.10

.05

01

.01

.06

01

.04

.06

01

.07

.06

01

.10

.06

01

.01

.07

01

.04

.07

01

.07

.07

01

.10

.07

01

.01

.08

01

.04

.08

01

.07

.08

01

.10

.08

01

.01

.09

0

50

100

150

200

250

300

KASE Index

Market share deals volume, USD m.

682.0

216

(05.01.05)

689.3

503.3 391.6507.4

KASE uses its own trading platform:

"Server – Client" electronic trading system

remote access

electronic signature and electronic document circulation

traffic encryption

on-line data preservation

OUR TECHNOLOGIES

KASE CONTACT DETAILS

Internet: www.kase.kz

E-mail: [email protected]

Phone: (+7 727) 237 53 00, 237 53 11, 272 98 98

Fax: (+7 727) 296 64 02, 272 09 25

Address: 291/3a, Dostyk ave, 050020, Almaty, Kazakhstan

http://www.kase.kz/

mailto:[email protected]

Documents

KAZAKHSTAN STOCK EXCHANGE (KASE) December 1, 2008