Bucharest Stock Exchange - a new start Dr. Lucian Anghel, Bucharest - PowerPoint PPT Presentation

Bucharest Stock Exchange - a new start Dr. Lucian Anghel, Bucharest Stock Exchange “The Sound of Money”, Sofia, May 15, 2012

Positive correlation between FDI and GDP / capita FDI, exports and GDP / capita in selected European countries Source: Eurostat 2

Romania’s GDP per capita increased faster than in other CEE countries in the last 10 years GDP per capita in CEE countries (EUR) 16000 Romania Poland Hungary Czech R 14000 12000 10000 8000 6000 4000 2000 0 2000 … 2005 … 2011 Source: Eurostat 3

Romanian leu is the most stable currency in CEE due to the managed floating regime followed by the central bank FX rate in CEE countries (January 2009 = 100%) 130% CZK HUF PLN RON 120% 110% 100% 90% 80% 02-Jan-09 02-Apr-09 02-Jul-09 02-Oct-09 02-Jan-10 02-Apr-10 02-Jul-10 02-Oct-10 02-Jan-11 02-Apr-11 02-Jul-11 02-Oct-11 02-Jan-12 02-Apr-12 Source: Reuters 4

Romania - Development potential until 2020 Indicator 2000 2011 2011 vs 2000 2020f 2020 vs 2011 GDP (EUR bn) 41 137 EUR 8 bn/year 245 EUR +109 bn GDP/capita - nominal (EUR) 1,800 6,400 +11% per year 11,500 +80% FDIs (EUR bn)* 7 54 EUR 3.9 bn/year 86 EUR +32 bn NonGvt. Loans (EUR)** 3 52 EUR 4.1 bn/year 95 2 x MkCap (EUR bn) 0.3 14 +46%y/y 46 3.4 x European Funds (EUR bn) - 2 - 7 EUR + 5bn * FDI stock in the reporting economy ** Resident customer data 5

Bucharest Stock Exchange – frontier market BET Return DJIA Return DAX Return Development of market capitalization and turnover Period (%) (%) (%) end 2007 to date -48.84% -3.35% -18.44% 35 30 MkCap excluding Erste Group Bank (EUR bn)-lhs end 2008 to date 73.25% 46.08% 36.79% Daily average turnover (EUR mn)-rhs 31.4 end 2009 to date 7.16% 22.94% 10.45% 30 25 end 2010 to date -4.60% 10.74% -4.83% end 2011 to date 15.89% 4.94% 11.56% 24.5 25 Source: Erste 21.8 20 Since the beginning of the year, BET marked the highest return (+15.9%) vs peers. 20 EUR bn 17.6 EUR mn 15 15 13.5 13.0 12.3 12.2 10.9 9.8 10.1 10 9.3 9.9 10 5.4 5.9 4.9 4.4 5 5 2.5 2.9 1.6 1.4 1.3 1.0 1.0 0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Source: Erste � Market capitalization (including Rasdaq segment and excluding Erste Group Bank) EUR 15bn Key figures � Market capitalization/GDP = 9% (2011) � Daily average turnover (2012) = EUR 8.3mn � 79 companies listed on the regulated segment � 24 companies with a market capitalization above EUR 50mn � 12 companies with a daily average turnover above EUR 50th 6

BET – one of the highest advances in Europe in 1Q2012 30% 23.9% 25% 22.7% 20% 17.8% 14.1% 15% 9.8% 10% 8.4% 8.3% 6.6% 5% 0% BET ISE 30 DAX ATX BUX CAC40 Euronext WIG20 100 Source: F.E.S.E. 7

Bucharest equity market vs its peers - undeveloped Market Capitalization, December 2011 120 35% 99.9 30% 29.3% 100 25% 21.8% 80 18.5% 20% 65.7 16.3% 60 14.7% 15% 12.0% 40 10.1% 29.2 10% 26.0 14.6 13.5 20 5% 6.4 0 0% Czech Hungary Poland** Romania* Bulgaria Greece Austria Republic Market Capitalization (EUR bn) Market Capitalization (% GDP) * Bucharest Stock Exchange capitalization excluding Erste Group Bank **Warsaw Stock Exchange capitalization includes only domestic companies Source: Eurostat, Erste 8

Top most traded companies in 2011 Free-Float Average Daily MkCap Dec. Free- Company Ticker Sector / Expertise capitalization Turnover (EUR th) 2011 (EUR mn) Float (EUR mn) Fondul Proprietatea FP Closed-end fund (key sector: energy) 5,157.81 1,361.99 73% 998.34 BRD-GSG BRD Banks 1,005.35 1,727.86 42% 720.13 SIF Oltenia SIF5 Closed-end fund (key sector: banks) 610.43 141.96 100% 141.96 SIF Moldova SIF2 Closed-end fund (key sector: banks) 390.53 129.78 100% 129.78 SIF Transilvania SIF3 Closed-end fund (key sector: banks) 385.47 143.35 100% 143.35 Banca Transilvania TLV Banks 348.97 362.97 85% 309.94 Petrom SNP Oil & Gas 340.64 3,802.76 8% 313.37 SIF Banat Crisana SIF1 Closed-end fund (key sector: banks) 202.49 114.73 100% 114.73 SIF Muntenia SIF4 Closed-end fund (key sector: banks) 178.50 106.68 100% 106.68 Argus Constanta UARG Edible oil producer 153.70 33.22 65% 21.53 Bursa de Valori Bucuresti BVB Stock exchange operator 127.04 51.34 100% 51.34 Transgaz TGN National gas transmission & system operator 123.48 608.77 12% 70.02 Oltchim Rm. Valcea OLT Organic basic chemicals 116.06 87.16 14% 11.94 Source: Erste 9

Dividend yield development for the most important listed companies 25% Fondul Proprietatea Transgaz Petrom SIFs 19% 20% ROBOR 3M* 15% 15% 13% 10% 11% 10% 10% 9% 8% 9% 8% 7% 9% 8% 6% 5% 6% 6% 4% 5% 3% 3% 2% 2% 0% 0% 0% 2006 2007 2008 2009 2010 2011 *Romania Interbank Offered Rate Source: BSE, NBR, Erste 10

Romanian Government’s ambitious plan to tap equity market (2012-2013) MkCap/Fair Stake of Stake held by Public offering Company Sector value the public Official timing the state value (EUR mn) (EUR mn) offering Transelectrica Pow er transmission 247 73.70% 15.0% 37 March 14 - 27, 2012 Transgaz 1 Gas transmission 577 73.50% 15.0% 87 June, 2012 Romgaz 2 Gas production - 85.00% 15.0% >250 September, 2012 Hidroelectrica 3 Pow er generation - 80.10% 10.0% >250 October, 2012 Nuclearleectrica Pow er generation - 90.30% 10.0% >100 December, 2012 Petrom Oil & Gas 5,034 20.60% 9.8% 493 Likely in 2013 Source: Government, Erste 1 Consortium intermediating the offering: Raiffaisen Capital & Investment, Wood & Company Financial Services and BT Securities 2 Consortium intermediating the offering: Goldman Sachs, Erste Group Bank, BCR, Raiffeisen Capital & Investment and Intercapital Invest 3 Consortium intermediating the offering: Citigroup, Societe Generale, BRD-GSG and Intercapital Invest 11

Transelectrica SPO, last successful public offering since 2008 SPO Figures: Transaction value: EUR 38mn Stake sold: 15% (seller: Minister of Economy) Subscription period: March 14 – March 27, 2012 Subscription level: 158.8% Institutional investors tranche - 90% of the shares sold - Oversubscribed 1.4x - Effective subscription value: EUR 50.5mn Retail tranche - 10% of the shares sold - Oversubscribed 2.8x - Effective subscription value: EUR 10.9mn About Transelectrica: • Transelectrica is the Romanian transmission and system operator, ensuring the security of the Romanian power system. MkCap: EUR 246.9mn • Transelectrica was listed on the BSE in June Average daily turnover (3M): EUR 84,187 2006 following 34.5mn EUR successful IPO 12

2012 – 2015: A new growth strategy for BSE 13

Regional cooperation between BVB and BSE is a must Cooperation between BVB Romania and Bulgaria Foreign investors are Romania and Bulgaria and BSE may (most probably) goes seeing Romania and entered the EU together increase the together in Schengen Bulgaria as part of the (2007) attractiveness area same region of both markets 14

Thank you!