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Qatar: a snapshot Population 2 21.3% annual growth 2004-2010 to reach 1.7 million Economic growth 1 27.2% nominal GDP growth 2005-2009 28.1% expected nominal.

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Presentation on theme: "Qatar: a snapshot Population 2 21.3% annual growth 2004-2010 to reach 1.7 million Economic growth 1 27.2% nominal GDP growth 2005-2009 28.1% expected nominal."— Presentation transcript:

1 Qatar: a snapshot Population % annual growth to reach 1.7 million Economic growth % nominal GDP growth % expected nominal GDP for % expected nominal GDP for 2011 Qatari Riyal pegged to US Dollar at 3.64 Oil & gas 3 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) 1.QNB, Qatar Economic Review, July Qatar Statistics Authority, 2010 Census 3.IMF Data Foreign affairs Qatar is member of the GCC, UN, OPEC, WTO, IMF 1

2 2010 and beyond: economy remains buoyant Source: QNB: Qatar Economic Review July QNB Capital Forecasts Dependence on oil & gas 2009 first year that oil & gas sector was overtaken Government is actively diversifying revenue sources * Preliminary ** QNB Forecasts Growth estimates One of the highest growth rates in the world Impact of global financial turmoil has been limited 2

3 QE History First day of trading of securities at Doha Securities Market (DSM) Introduction of the Central Registration System Investors were able to sell their purchased shares on the next day following their purchase (T+1) 2000 Implementation of companies linkage project through the internet the first of its kind in the GCC 2001 Start of electronic trading project to replace manual trading systems Investors able to sell their purchased shares on the same day; approval of a new market index 2005 Non- Qataris permitted to invest in up to 25% of the shares offered for trading Became correspondent of World Federation of Exchanges (WFE) Signed strategic partnership agreement with NYSE Euronext to transform Qatar Exchange into world-class market launched NYSE Euronext Universal Trading Platform April 2011 Implementation of DVP SFTI connectivity

4 QIA - QE - NYSE Euronext partnership 80% shareholding of QE through Qatar Holdings 20% shareholding of QE 4 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 Countrys 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

5 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 Support and commitment from State of Qatar to reform financial & regulatory system Building on solid foundations -not a start up struggling to attract business but a reasonable sized domestic exchange Partnership with NYSE Euronext -shareholder with vested interest -expert knowledge in developing international markets 5 QE Strategy

6 Best trading environment New trading opportunities Efficient post trade system Companies and IPOs meet international standards Cash product diversification Derivatives Broad access International best practices Education & training Broaden membership base Lower barriers to entry Diversify services provided 6

7 Banks DMA SFTI QFCRA licensed institutions Segregation of roles in value chain Adjusted trading model UTP Liquidity providers Lending & borrowing Covered short selling CCP 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 QE Strategy 7

8 QE: a snapshot 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 Growth % growth in the QE20 index during % growth in the market cap 270% growth in number of annual transactions 8 QE was the best performing market in the MENA region for 2010

9 QE today 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 SectorFull Market Weighting Banking and Financial33.66% Industrial18.92% Insurance2.30% Services45.12% Qatar Exchange - Brokers Ahli Brokerage Company 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 9

10 The QE Central Registry Department (CRD) Fully integrated within QE 25 staff Nasdaq-OMX Equator technology 3 Custodians: HSBC, Qatar National Bank, Standard Chartered Dual listing with ADSM(QTEL) 10

11 The CRDs Missions 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 11

12 The CRD in Numbers (2010) 10,708 Exempt Transfers 1,444 Pledges 5,035 new Accounts opened 263,747 Account Statements 0 Failed Trade 12

13 2011 so far & still to come Successful DvP Implementation Buyers Compensation Enhancement New Custodians Securities Lending Program Margin Lending VaR-based Risk Management SWIFT Developments ANNA membership 13

14 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 14


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