Transcript Corporate Title Slide, Arial 36pt Regular, Title Case

Qatar: a snapshot
Economic growth1
 27.2% nominal GDP growth 2005-2009
 28.1% expected nominal GDP for 2010
25.5 % expected nominal GDP for 2011
 Qatari Riyal pegged to US Dollar at 3.64
Population2
 21.3% annual growth 2004-2010 to reach 1.7 million
Oil & gas3
 Proven reserves of 85 years at current production levels
 Largest supplier of LNG with 14.43% of world reserves
(Note: LNG production capacity reached 77 million tons by
Dec 2010)
Foreign affairs
 Qatar is member of the GCC, UN, OPEC, WTO, IMF
1.
2.
3.
QNB, Qatar Economic Review, July 2010
Qatar Statistics Authority, 2010 Census
IMF Data
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2010 and beyond: economy remains buoyant
(QR million)
Nominal Oil and Gas GDP
% Growth/Decline
Nominal non-Oil and Gas GDP
% Growth
Total Nominal GDP
% Nominal GDP Growth/(Decline)
% Real GDP Growth
2009
165,325
-23.1%
192,535
2.4%
357,860
-11.2%
8.7%
Dependence on oil & gas
2009 first year that oil & gas sector was
overtaken
Government is actively diversifying
revenue sources
2010
235,500
42.4%
223,025
15.8%
458,525
28.1%
14.5%
2011
318,650
35.3%
256,590
15.0%
575,240
25.5%
17.0%
* Preliminary ** QNB Forecasts
Growth estimates
One of the highest growth rates in the world
Impact of global financial turmoil has been limited
(QR million)
1. Oil & Gas
% Change
- Gas
- Oil
2. Non-Oil & Gas
% Change
- Agriculture & Fishing
- Manufacturing
- Electricity & Water
- Building & Construction
- Trade, Restaurants and Hotels
- Transport & Communications
- Finance, Insurance & Real Estate
- Other Services
Total GDP
% Change
Total GDP ($ million)
GDP per capita ($)
2006
130,203
41.4%
54,762
75,441
90,005
39.4%
233
23,236
2,431
7,674
9,609
8,950
19,476
18,396
220,208
40.6%
60,497
58,073
2007
166,642
28.0%
78,944
87,698
127,291
41.4%
270
26,001
3,179
21,625
15,480
13,539
27,309
19,888
293,933
33.5%
80,751
65,854
2008
215,053
29.1%
97,550
117,503
187,940
47.6%
305
37,946
4,348
32,507
20,674
21,199
38,106
32,855
402,993
37.1%
110,712
71,256
2009
165,325
-23.1%
87,500
77,825
192,535
2.4%
315
28,363
3,913
25,781
23,946
22,696
43,374
44,147
357,860
-11.2%
98,313
60,251
2010
235,500
42.4%
142,100
93,400
223,025
15.8%
325
43,800
4,700
27,100
26,150
28,300
45,550
47,100
458,525
28.1%
125,968
74,100
Source: QNB: Qatar Economic Review July 2010. QNB Capital Forecasts
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QE History
1999 Investors
were able to
sell their
purchased
shares on the
next day
following their
purchase (T+1)
1997 First day
of trading of
securities at
Doha
Securities
Market (DSM).
1998
Introduction of
the Central
Registration
System.
2005 NonQataris
permitted to
invest in up to
25% of the
shares offered
for trading.
2001 Start of
electronic
trading project
to replace
manual trading
systems.
2000
Implementation
of companies’
linkage project
through the
internet the
first of its kind
in the GCC
2009 Signed
strategic
partnership
agreement with
NYSE
Euronext to
transform
Qatar
Exchange into
world-class
market.
2002 Investors
able to sell
their purchased
shares on the
same day;
approval of a
new market
index
2007 Became
correspondent
of World
Federation of
Exchanges
(WFE).
April 2011
Implementation
of DVP
SFTI
connectivity
2010 launched
NYSE
Euronext
Universal
Trading
Platform
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QIA - QE - NYSE Euronext partnership
80% shareholding of QE through
Qatar Holdings
20% shareholding of QE
In June, 2009 QIA and NYSE Euronext formed a strategic partnership agreement – Qatar Exchange. The
Exchange is part of a comprehensive national strategy that aims to establish Qatar as a world-class
international market and reinforce the Country’s position as regional financial centre by introducing new
trading products, technology and international investors and issuers to Doha. Qatar Exchange is regulated
by the Qatar Financial Markets Authority
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QE Strategy
Objectives:
•
Develop a successful regional and international exchange with strong domestic roots
•
Offer diversified range of investment and trading opportunities for investors and members
•
Provide access to domestic and international investors for listed companies from Qatar and abroad
Competitive Advantages
•
Strength of the economy
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Support and commitment from State of Qatar to reform financial & regulatory system
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Building on solid foundations
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not a start up struggling to attract business but a reasonable sized domestic exchange
Partnership with NYSE Euronext
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shareholder with vested interest
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expert knowledge in developing international markets
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QE Strategy
• Best trading environment
• New trading opportunities
• Efficient post trade system
• Companies and IPOs meet
international standards
• Cash product diversification
• Derivatives
• Broaden membership base
• Lower barriers to entry
• Diversify services provided
• Broad access
• International best practices
• Education & training
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QE Strategy
• Adjusted trading model
• UTP
• Liquidity providers
• Lending & borrowing
• Covered short selling
• CCP
• Banks
• DMA
• SFTI
• QFCRA licensed institutions
• Segregation of roles in value
chain
• Disclosure & IR practices
• IPO process
• Free float requirement
• Corporate actions
• Indices
• Cash market: ETFs & bonds
• Derivatives
• GCC IPOs
• Dual listings with NYSE Euronext
• Foreign participation
• WFE & MSCI
• Education & Training
• Trading hours
• Global Custodians
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QE: a snapshot
Growth 2004-2010
Investors
 Foreign institutions account for 22.5% of the annual trading
turnover
 Qatari institutions account for 20.5% of the annual trading
turnover
 Over 1200 foreign institutions and funds investing in QE
stocks directly
500
12,000
450
450.20
400
350
8,000
347.70
300
320.21
317.20
250
6,000
279.04
200
221.73
4,000
150
100
10,000
Index
Market Cap QR
Billions
 24.75% growth in the QE20 index during 2010
 206% growth in the market cap
 270% growth in number of annual transactions
147.19
2,000
50
0
0
2004
2005
2006
2007
Market Capitalization
2008
2009
2010
Market Index
QE was the best performing market in the MENA region for 2010
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QE today
Sector
Full Market Weighting
Banking and Financial
33.66%
Industrial
18.92%
Insurance
2.30%
Services
45.12%
Qatar Exchange - Brokers
Ahli Brokerage Company
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41 listed companies and four sectors (plan to move to 7
sectors in line with international standards)
Total market cap: over $120 billion
QE Index covers 20 companies
Ten brokers, 3 of which just started in 2011
Fees: 27.5 bps (charged by brokers)
• 22 bps to brokers
• 5.5 bps to the Qatar Exchange
SWIFT in place between QE, custodians and QCB
UTP successfully implemented – Sept 2010
New Tick Sizes
Enhanced Trading hours
Commercial Bank Investment Services
Dlala Brokerage
Dlala Islamic Brokerage
Gulf Investments Group
International Financial Securities
Islamic Financial Securities
Qatar Securities
QNB Financial Services
The Group Securities
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The QE Central Registry Department (CRD)
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Fully integrated within QE
25 staff
Nasdaq-OMX Equator technology
3 Custodians: HSBC, Qatar National Bank,
Standard Chartered
Dual listing with ADSM(QTEL)
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The CRD’s Missions
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NIN Account Openings
Exempt (off-market) Transfers
Processing of Pledges and Court Orders
Monitoring of the Brokers’ Settlement Cap
Corporate Actions
Foreign & Single Ownership Limits
DvP & Failed Trades Management
Daily Settlement Procedure
Cash-settlement Process with the QCB
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The CRD in Numbers (2010)
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10,708 Exempt Transfers
1,444 Pledges
5,035 new Accounts opened
263,747 Account Statements
0 Failed Trade
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2011 so far & still to come
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Successful DvP Implementation
Buyer’s Compensation Enhancement
New Custodians
Securities Lending Program
Margin Lending
VaR-based Risk Management
SWIFT Developments
ANNA membership
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Longer Term Plans
• Creation of a fully-integrated CCP
 100% QE-owned separate legal entity
 CCP for Cash, Derivatives & OTC
 Settlement Cap replaced with Guarantee
Fund
• Creation of a Third-Party CSD
 Separate legal entity with QE stake
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