2013 07 24 bvb ir presentation en

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Bucharest Stock Exchange Presentation


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2 www.bvb.ro

Operator of the leading Romanian cash & derivatives markets

Integrated Group: Trading, Clearing, Settlement and Registry Systems

Market cap of approx. EUR 34.6mn, cash equals 45% of the Market Cap

100% free-float, no major shareholder

Rich cash position, close to zero leverage

Stable dividend policy with 100% payout ratio, after legal reserves

Stock price close to historical lows, but with good perspectives in privatization process

Investment positives


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Markets operated by BVB

Regulated spot market

Shares and rights (issued by local

and international entities)

Corporate and municipal bonds

Government securities

Structured productsFund units

Tradable UCITS (ETFs)

3

Regulated derivatives market

Futures contracts with shares,

indices, commodities and

exchange rates as underlying

assets

Alternative trading system

Securities issued by Romanian

companies not qualified for the

regulated market

Foreign stocks listed on developed

markets and traded at BVB

RASDAQ market

Shares and rights issued by

Romanian entities are traded, most

of them coming from the mass

privatization programme

Bucharest Stock

Exchange


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BVB indices

4

BET

Reference index for BVB

Most liquid 10 listed companies

BET-BK


Can be used as a benchmark by

fund managers

BET-C

All companies listed on BVBs

regulated market, 1stand 2nd

Tier, excepting the SIFs

BET-FI

Sectorial index including the 5

SIFs and Fondul Proprietatea

BET-NG

Sectorial index for energy and

utilities

BET-XT

Blue chip index


ROTX

Developed by BVB together with

Wiener Boerse

Follows the same principles as

the CECE Index family

Includes most liquid blue chip

stocks traded at the BVB


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5 www.bvb.ro

According to the current provisions of the law, BVB

shareholders may not own more than 5% of the total

voting rights (directly or indirectly).

The intention to acquire more than 5% should be

disclosed to the Stock Exchange and the market

Regulator

BVB Shareholding Structure

as of June 30, 2013

Central

DepositaryCash MarketClearing

Settlement

Registration

Bucharest StockExchange

Cash & Derivatives

Trading

Corporate

GovernanceInstitute

52.5% 62.3%69% 100%

Bucharest

Clearing HouseDerivatives MarketClearing

Investors

CompensationFund

BVB Group

Internationalinstitutionalinvestors,11.03%

Internationalprivate

individuals,1.92%

Romanianinstitutionalinvestors,69.33%

Romanianprivate

individuals,17.72%


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Board of Governors & CEO

Lucian Anghel (BCR)President

Board of Governors Chief Executive Officer

Adrian LupsanVice-President

Dan Paul (Brokers Association) Vice-President

Robert Pana (Swiss Capital)Secretary General

Valerian Ionescu (BCR)Member

Matjaz Schroll (Franklin Templeton)Member

Narcisa Oprea (Schoenherr & Associates)Member

Stere FarmacheMember

Octavian Molnar(SSIF IFB Finwest)Member

Ludwik Sobolewski

Appointed by the Board of Governors on July 1st

Mandate to start after FSA endorsement

Former President and CEO of the Warsaw Stock

Exchange between 2006 and 2013

Former Executive VicePresident of the National

Depository (and Clearing House), also serving aschairman of Supervisory Boards of, among others, the

National Depository for Securities, the Polish Power

Exchange and BondSpot (a company organizing

market for government bonds)

6

Unitary management system


7/247 www.bvb.ro

Strategic priorities

Support the successful closing of the state companies public offers1.

List new companies on the Bucharest Stock Exchange and increase number of active investors2.

Develop capabilities, products and services offered by the Bucharest Stock Exchange Group3.

Improve the corporate governance and functioning of the Bucharest Stock Exchange as a Group4.

Simplify and improve the regulations, reduce bureaucracy and apply international best practices5.

Increase the visibility of the Bucharest Stock Exchange and of the issuers, along with increasing the

awareness of the important role that the Romanian capital market is playing6.

Develop dialog between the Bucharest Stock Exchange and relevant institutions/authorities7.

Increase the educational role of the Bucharest Stock Exchange8.


8/248 www.bvb.ro

Main current projects

The establishment of a Central Counterparty (a joint project along with the Central Depositary and Sibex) the

opportunity of a foreign CCP is currently being analyzed

The clarification of RASDAQ markets status the process is in an advanced stage, with several draft laws

submitted to the Romanian Parliament

Encouraging short selling and securities lending (a joint project with the Central Depositary)

The separation of the trading environment from post-trading and aligning to international standards (joint project with

the Central Depositary)advanced stage

The improvement in coordination of operations at BVB Group levelincipient stage

Corporate Governance project along with EBRD, aimed at developing corporate governance and reporting practices

for Romanian listed companiesrecently launched

Promotion of corporate governance and post-listing transparency for state-owned companies to be privatized

through the capital market

Promotion of financing alternatives, a program targeting Romanian SMEs (events, oneon-one meetings, informativematerials, editorial project with wall-street.ro RomaniaDiscovers the Stock Exchange)


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Corporate Governance

9

BVBsArticles of Incorporation include all matters related to Corporate Governance, including shareholders rights,

management, functioning, shareholder meetings, special committees an so on.

There have been requests from BVBs shareholders to change the current unitary management system into a dual

system. The proposals are being analyzed by the Board, according to the legal framework in force.

In 2011, BVB adhered to The Corporate Governance Code and included a dedicated chapter in the Annual Report,

while last year BVB started preparing the Comply or Explain Statement.

CG at the Bucharest Stock Exchange

CG among market participants

BVB also supports the improvement of Corporate Governance practices among participants on the capital market.

Such efforts materialized into a cooperation agreement with OPSPI (the Office of State Ownership and Privatisation in

Industry), through which BVB, through its Corporate Governance Institute, would provide state-owned companies with

consultancy services to prepare them in view of their privatization/listing.

Moreover, a 2-year joint project with EBRD started this year, focusing on the development of the corporate governance

and reporting practices of local listed companies, under the review and implementation of the Romanian CG Code.


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Source: BVB, FESE

Exchange 2012 2013*

Athens Exchange 30.8% 95.7%

Bulgarian Stock

Exchange-21.1% 7.4%

CEESEG -

Budapest

7.6% -0.6%

BVB 11.7% -1.5%

CEESEG -

Ljubljana0.8% -2.2%

CEESEG -

Vienna22.4% -6.0%

Warsaw Stock

Exchange25.4% -8.1%

CEESEG -Prague

-3.5% -21.9%

*Data for Jan-Jun 2013. Calculations in EUR terms

Market Cap change

BVB in the region

4.8 5.4 11.915.6 22.0

66.6 75.6

123.8

CEESEG -Ljubljana

BulgarianStock

Exchange

BVB CEESEG -Budapest

CEESEG -Prague

AthensExchange

CEESEG -Vienna

WarsawStock

Exchange

Domestic Market Cap (EURbn) - Main market (end-Jun 13)

2852 61

80 98103

257

330

CEESEG -Prague

CEESEG -Budapest

CEESEG -Ljubljana

BVB BulgarianStock

Exchange

CEESEG -Vienna

AthensExchange

WarsawStock

Exchange

Number of listed companies - Main market (end-Jun 13)

1.2 3.1 6.221.2 30.4

74.0 77.8

258.6

CEESEG -Ljubljana

BulgarianStock

Exchange

BVB CEESEG -Prague

CEESEG -Budapest

AthensExchange

CEESEG -Vienna

WarsawStock

Exchange

Main stock market turnover in Jan-Jun 2013 (EURmn/day)


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Symbol Company% of

turnover

Avg. daily turnover

(EURmn)

FP Fondul Proprietatea 46.8% 3.16

SNP OMV Petrom 9.6% 0.66

BRD BRD Groupe Soc. Gen. 6.3% 0.43

TLV Banca Transilvania 5.9% 0.41

SIF3 SIF Transilvania 5.1% 0.34

EBS Erste Group Bank AG 4.8% 0.32

SIF5 SIF Oltenia 4.2% 0.29

SIF2 SIF Moldova 4.0% 0.27

TGN S.N.T.G.N. Transgaz 3.1% 0.21

SIF1 SIF Banat Crisana 2.9% 0.19

With the listing of Fondul Proprietatea, BVB achieved in

2011 one of the highest ADT growth rates in Europe. In 2012,

ADT declined on macro and political uncertainties.

The structured products segment was the most dynamic at

BVB: ADT tripled in 2011 yoy (from a small base) and

increased by 50% yoy in 2012.

Trading activity statistics

Most traded companies (YTD*)

*until July 15, 2013. Public offers are not included.

*until July 15, 2013

Average daily turnover (EURmn)

4.85.3

9.2

6.7

7.7

1.2

2.5

0.5

1.3

1.3

0.4

0.6

0.6

2009 2010 2011 2012 2013 YTD

Shares/Fund Units Bonds Structured products


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The turnaround settlement for OTC transactions was implemented in March 2012, possible for all listed shares on BVB

As OTC turnaround trades are linked to at least one correspondent trade concluded on BVB, such service delivers

substantial efficiencies to the market players by creating further opportunities for non-resident investors, with an easier

access to Romanian financial instruments, including those which are subject to public offerings.

Thus, it is easier to access domestic financial instruments, allowing international market players to expand their global

business with the Romanian securities.

The launch of the turnaround settlement service adds significant value to the new infrastructure improvementsdelivered by BVB Group in recent years (such as omnibus accounts), striving to be fully aligned to European industry

standards and paving the way to increased market accessibilityan important step in increasing liquidity.

As a result, EUR 78mn worth of trades were settled in H1 2013, accounting for approx. 6% of all settlements made by

the Central Depositary during the same period.

In the region, turnaround trades account for 40-45% of all settlements on average, therefore there is significant

potential for the local market to grow in terms of liquidity, supported by such trades.

Turnaround trades


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Company Sector

Market Cap/

Fair value(EURmn)

Gov.

stake

Stake of

the publicoffering

Offering

value(EURmn)

What is for sale Status

Transgaz1Gas

transmission534 73.5% 15%

Approx.EUR 72mn

Existing sharesFinalized

416 April 2013

Nuclearelectrica2Power

generation- 90.3% 10% >80 Capital increase

Expected in

Q3 2013

Romgaz3Gas

production

- 85.0% 15% >250 Existing sharesExpected until

end-October 2013

ElectricaElectricity

distribution- 100% 105%5 >100

Capital increase

by 105%

Expected in

Q4 2013

CE OlteniaPower

generation- 77.2% 12%5 >70

Capital increase

by 15.29%

Expected in Q4 2013

Q1 2014

Hidroelectrica4Power

generation- 80.1% 10%5 >250

Capital increase

by 12.49%

Postponed after the

company exits

insolvency (which took

place in Jun 2013).

Expected inQ1-Q2 2014

Source: Government, BVB

1. Consortium intermediating the offering: Raiffeisen Capital & Investment, Wood & Company Financial Services and BT Securities

2. Consortium intermediating the offering: Swiss Capital and BT Securities

3. Consortium intermediating the offering: Goldman Sachs, Erste Group Bank, BCR, Raiffeisen Capital & Investment and Intercapital Invest

4. Consortium intermediating the offering: Citigroup, Societe Generale, BRD-GSG and Intercapital Invest

5. Percent of the share capital before the share capital increase

Estimated Romanian privatization agenda


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International

69%

Domestic31%

Subscriptions breakdown by geography

Recent events

14

Source: Raiffeisen Capital & Investment

15% stake sold by the Romanian State

SPO period: 4-16 April 2013

Worth of approx. EUR 72mn

2-week roadshow, with more than 100 investors

contacted

3 tranches: one for institutional investors (85% of the

offer), two for retail investors, with discounts for the

small subscriptions tranche (3% and 5%, depending

on the day when the subscription was made)

SPO price for institutionals: RON 179/share

Closed book for the institutional tranche

Significant oversubscriptionfor the two retail

tranches

The notable oversubscription for all three tranches, as

well as the resulting 5 times increase in average daily

turnover after offer was finalized, proved once again the

significant interest in new shares that reach the market.

By extrapolation, any new companies listed at BVB, be

either state-owned or private, will attract similar

attention, if not higher, given the new flavor they would

represent and investors significant need to diversify

their portfolios.


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Corporate bonds at BVB

5-year, RON-denominated corporate bonds,

maturing on 30 Oct 2017

Interest rate: 7.40%/annum

Public offer period: 17-23 October 2012

Started trading at BVB on 20 November 2012

Offer value: RON 250mn (approx. EUR 55mn)

First time the closed book mechanism was used

by BVB for public offers

5-year, RON-denominated corporate bonds,

maturing on 15 Jun 2018

Interest rate: 6.35%/annum

Public offer period: 14-21 June 2013

Started trading at BVB on 2 July 2013

Offer value: RON 550mn (approx. EUR 123mn)

following the significant oversubscription (by 10%)

Closed book mechanism, with subscriptions of more

than 30 local and international institutional

investors, including EBRD and IFC, investment funds,

pension funds, insurance companies, banks

15

Both BVB and the Financial Supervisory Authority (FSA) have acknowledged the importance of bond issues as

alternatives to traditional financing through bank loans and as gateways to the capital market, and thus both institutions

have taken steps to decrease related costs with a view to encouraging such public offers, as follows:

BVB has suspended its fee for applied to the buy value for the initial sale offers, to the primary sale public offers,

to the other primary methods for bond sale, during Jun 1, 2013Dec 31, 2014, and

FSA has suspended the fee for bond offers until the end of 2013.


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BVBs alternative trading system

Provider of professional cleaning & maintenance

services for hotels, offices, commercial facilities

First Romanian company listed on BVBs ATS,Equity Sector, Base TierShares

Started trading at BVB on 3 October 2013

Provider of financial services, such as leasing,

loans, bancassurance, foreign exchange

Included in the 1st

Tier of the ATS (Equity Sector)Started trading at BVB on 11 July 2013

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Created in 2010 to provide SMEs a flexible and simplified alternative of listing and access to financing through capitalmarket mechanisms.

Currently, there are 2 companies listed on ATS, described below, and other companies may follow suit, given the tighter

requirements for accessing bank loans and other types of financing.


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Source: Investors Compensation Fund

The current compensation limit is EUR 20,000, in line with EU directives

More than 90% of investor accounts have portfolios below EUR 20,000 and are fully compensated

The number of investor accounts includes the total number of accounts on the Romanian capital market, regardless if

an investor has accounts with several brokers

Investor accounts on the local capital market

87,66492,865 94,545

86,453 88,14381,559

78,253

31.12.2007 31.12.2008 31.12.2009 31.12.2010 31.12.2011 31.12.2012 31.03.2013

Number of investor accounts on the local market

Fully compensated investors Ceiling compensated investors Excluded investors Total investors


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Cash Equity Market Sell Buy*

Jan 2006 - May 2007 15 bps 7bps

June 2007 - Sep 2008 14bps 6bps

Oct 2008 - February

200913bps 5bps

After March 2009 11.7bps 4.5bps

*plus 8 bps CNVM fee on the value of a buy trade;

**plus RON 0.1 CNVM fee on each traded futures contract.

Note: Fees in basis points (bps) are charged on the value, to both counterparties (buy & sell);

BVB and CNVM fees do not refer to Market Makers.

Current pricing policy

Historical trading feesParticipants

annual maintaining feeRON 1,500,

including VAT

Issuers

annual maintaining fee

btw. RON 3,600 and

RON 21,000,

without VAT

Trading fees Sell Buy

Shares, Fund Units

Main Market + Deal11.7bps 4.5bps*

Structured products 12 bps 5bps*

Bonds 2.16 bps

T-bills

0.08 bps,

btw RON 1 and 81

FuturesAn average of RON 0.1 per

contract **

BVBs pricing policy


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19 www.bvb.ro

RONmn 2009 2010 2011 2012 Q1.2013Sales revenues 12.4 13.1 21.7 17.4 4.1

Operating revenues 12.4 13.2 21.7 17.5 4.1

Operating expenses 13.9 12.9 15.3 13.4 3.4

EBITDA -0.1 1.0 7.1 4.7 0.8

Operating result -1.5 0.3 6.4 4.1 0.7

Financial result 11.1 6.2 12.4 6.0 1.1

Net income 8.5 5.7 17.0 9.0 1.5

EPS 1.1 0.7 2.2 1.2 0.2

*RAS figures, acc. to EU Directive No 4

The Bucharest Stock Exchange reported a net profit of RON 1.5mnin Q1.2013, despite the lower trading activity

during the first two months of the year. In March, also influenced by the positive sentiment on developed markets,

trading values registered a notable increase, as investors accumulated stakes in some issuers before reference

dates for annual shareholders general meetings.

Sales revenues reached RON 4.1mn during the quarter, up by approx. 20% vs. the previous quarter, due to a revivalin volumes traded, but compared to the year-ago period (which was one of the best quarters of the last 5 years, partly

due to the SPO for Transelectrica) the turnover registered a decline by a similar percentage.

Operating expenses were RON 3.4mn during Q1.2013, resulting in an operating profit of RON 0.7mn, compared to

an operating loss of RON 0.7mn in the previous quarter.

The financial result amounted to RON 1.1mn in Q1.2013 (comprising interest revenues, as well as unrealized

foreign exchange gains), down by 8% y-o-y but significantly higher compared to Q4.2012.

Financial performance


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20 www.bvb.ro

Breakdown of quarterly results

BVBs Q1.2013 sales revenues were mostly driven, as usual, by trading revenues which have the highest weight in

total operating revenues (27% higher q-o-q but 20% lower y-o-y). The data vending segment and maintenance fees

charged to issuers displayed a downward trend vs. both Q1.2012 and Q4.2012.

The operating result improved from Q4.2012, when losses were reported, but vs. Q1.2012 a significant decline

was registered because of lower revenues.

BVB ended Q1.2013 with a net profit of RON 1.53mn, resulting mainly from financial activities (interest earned and

unrealized foreign exchange gains).

6.0

4.8 5.0 4.94.0

3.44.1

2.5

-0.4

1.9 1.71.1

-0.7

0.71.5 1.7 1.2

3.7

1.0 0.2 1.1

Q3.2011 Q4.2011 Q1.2012 Q2.2012 Q3.2012 Q4.2012 Q1.2013

Quarterly sales revenue and operating result (RONmn)

Sales revenue Operating result Financial result


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21 www.bvb.ro

RONmn 2009 2010 2011 2012End-Mar

2013

Non-current assets 25.4 25.4 28.7 28.6 29.2

Current assets 67.2 64.6 77.5 69.3 70.7

o/w: cash, cash

equivalents and

securities64.6 63.3 73.8 65.0 64.9

Prepaid expenses 0.3 0.1 0.1 0.1 0.1

Total assets 92.5 90.1 106.2 98.0 100.0

Shareholders equity 90.2 88.0 102.0 94.6 96.1

Short-term debt 2.2 1.5 2.6 2.4 3.0

Long-term debt 0.01 0 0 0 0

Prepaid revenues 0.5 0.6 0.7 0.7 0.7

Provisions 0 0 0.9 0.3 0.2

Total equity and

liabilities92.5 90.1 106.2 98.0 100.0

*RAS figures acc. to EU Directive No 4

Debt-free capital structure

The decrease in cash position in 2012 reflects the highest dividends

ever paid to BVB shareholders

Starting 2009 BVB had a stable dividendpolicy, with a payout ratio of 100%, after legal

reserves.

For the following years, BVB intends to

maintain the policy of distributing cash

dividends.

* Gross amounts, year paid

Individual balance sheet overview

1.30

1.02

0.70

2.14

1.12

2009 2010 2011 2012 2013

Ordinary dividend

(RON/share)


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22 www.bvb.ro

RONmn 20122013

Budget

y-o-y

change

2014

Projection

y-o-y

change

2015

Projection

y-o-y

change

Sales revenues 17.4 18.8 8% 25.6 36% 32.0 25%

Operating revenues 17.5 18.8 8% 25.6 36% 32.0 25%

Operating expenses 13.4 15.5 16% 15.9 3% 17.0 7%

EBITDA 4.7 4.2 -11% 10.6 151% 16.0 51%

Operating result 4.1 3.4 -18% 9.7 189% 15.1 55%

Financial result 6.0 2.1 -64% 1.0 -53% 2.1 107%

Net Income 9.0 4.6 -49% 9.0 97% 14.6 61%

EPS 1.2 0.6 -49% 1.2 97% 1.9 61%

*RAS figures

2013 is expected to bring about a process of modernization and improved efficiency for BVB, following the

implementation of a new organizational structure. Thus absolutely necessary expenses were accounted for, and

projects were planned (which should lead to the future development of the stock exchange as a financing alternative

for the economy), all leading to modernization and increased efficiency.

BVB will be involved in a series of projects related to the capital market architecture(such as the CentralCounterparty project), which will require significant investments with implications on the 2013 budget and also for the

future years projections.

Even though BVBs profitability for 2013 will be affected, all these measures and projects would set grounds for a

sustainable organic development which will be reflected in the future years financial results. Thus, the operating

result for 2014 and 2015 is estimated to compensate for the declines in previous years and to exceed the

10% growth rate set as target by BVBs Board of Governors.

2013 budget and projections for 2014-2015


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15

17

19

21

23

25

27

Turnover velocity(value traded average market cap)

2010 154%

2011 42%

2012 40%

Liquidity(shares traded shares outstanding)

2010 104%

2011 32%

2012 37%

23 www.bvb.ro

BVB share data and statistics

Included in several indices:

FTSE Mondo Visione Exchanges Index (Nov 9, 2010)

BET Index (Mar 21, 2011)

Dow Jones Global Exchanges Index (Jun 17, 2011)

ROTX Index (Sep 19, 2011)

BET-BK (Jul 3, 2012)

Symbol BVB

ISIN ROBVBAACNOR0

Reuters ROBVB.BX

Bloomberg BVB.RO

Bloomberg BBGID BBG000BBWMN3

Share price (15 July) RON 19.96

Market Cap (15 July) EUR 34.6mn

Outstanding shares 7,674,198

Free float 100%

BVB share evolution (12 months)

Analyst

(Company)

12M TP

(Recommendation)

Last report

Vlad Vasilescu

(NBG Securities)22.0 (Outperform) Jul 8, 2013

Raluca Negoescu

(Alpha Bank)18.0 (Hold) May 7, 2013

Andrei Radulescu

(SSIF Broker)24.96 (Buy) Feb 13, 2013

Roxana Dascalu

(SSIF IEBA Trust)22.64 (Hold) Jan 31, 2013

Analyst coverage

2012 dividend: RON 1.12/share

Registration date: 15 May

Ex-divi date: 13 May

21.9

22.93

19.66

22.48

19.96

24.39

20.27

21.97

17.27


24/24

24 www bvb ro

Bursa de Valori Bucuresti S.A.

34 - 36 Carol I Boulevard, 14th FloorBucharest, District 2, Romania

Tel:(+40)(21) 307 95 00

Fax: (+40)(21) 307 95 19

www.bvb.ro

[email protected]

Contact person:

Anca Olteanu

This presentation was prepared by Bursa de Valori Bucuresti. The information contained in this document has not beenindependently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed

on the fairness, accuracy, completeness or correctness of this information. Past performance is no guarantee of future results.

This document does not constitute an offer or invitation to purchase any shares. Certain statements contained in this document

may be statements of future expectations and other forward-looking statements that are based on the managements current

views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or

events to differ materially from those expressed or implied in such statements.The exchange rate used for the average daily turnover is the official exchange rate announced by the National Bank of Romania.

Financial Calendar

2/11/20132012 Preliminary results & EarningsConference Call

4/24/2013 - 4/25/2013GSM

5/10/2013Q1.2012 Results & Earnings

Conference Call


Conference Call


Conference Call

Disclaimer

Financial calendar and Contact info
http://www.bvb.ro/mailto:[email protected]:[email protected]://www.bvb.ro/

2013 07 24 bvb ir presentation en

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