1.  IPO trends worldwide and experiences from the Warsaw Stock Exchange Tomasz Konieczny 2 July 2010

2. PricewaterhouseCoopers Page 2 Agenda Recent IPO trends Experiences from Warsaw Privatisation through the WSE 

3. PricewaterhouseCoopers Page 3 Agenda Recent IPO trends Experiences from Warsaw Privatisation through the WSE 

4. PricewaterhouseCoopers Page 4 Source: PricewaterhouseCoopers – IPO Watch Europe Number and value of IPOs on the European markets 2003-2009 Recent IPO trends

5. PricewaterhouseCoopers Page 5 Number and value of IPOs in Europe (by quarter) Source: PricewaterhouseCoopers – IPO Watch Europe Recent IPO trends

6. PricewaterhouseCoopers Page 6 Number and value of IPOs on main EU regulated markets in 2009 Source: PricewaterhouseCoopers – IPO Watch Europe Recent IPO trends

7. PricewaterhouseCoopers Page 7 Number and value of IPOs on main exchange regulated markets in 2009 Source: PricewaterhouseCoopers – IPO Watch Europe Recent IPO trends

8. PricewaterhouseCoopers Page 8 Agenda Recent IPO trends Experiences from Warsaw Privatisation through the WSE 

9. PricewaterhouseCoopers Page 9 Warsaw Stock Exchange (WSE) WSE runs several markets: -Main Market – EU regulated -alternative markets (New Connect for equities, Catalyst for debt) – exchange regulated According to FESE data, WSE market capitalisation at the end of May 2010 was EUR 118,224 million As of 18 June 2010 there were: -381 companies listed on the WSE Main Market, 23 of which were non-domestic (including two Estonian entities) -135 companies listed on the NewConnect market, 2 of which were non-domestic Experiences from Warsaw

10. PricewaterhouseCoopers Page 10 Source: FESE Experiences from Warsaw € ‘000

11. PricewaterhouseCoopers Page 11 WSE and selected other regional exchanges Stock exchange Market capitalisation (€m) Number of companies (main + alternative) WSE118.2508 Vienna76.9113 Prague32.832.826 Budapest21.121.146 Source: FESE, May 2010 Experiences from Warsaw

12. PricewaterhouseCoopers Page 12 Number and average offering value of domestic IPOs on the WSE main market by total assets and revenue of issuers (2006-2009)* Experiences from Warsaw Source: PricewaterhouseCoopers, prospectuses and current reports of listed companies * Translated from PLN to EUR using 4.1082 PLN/1€ exchange rate (end-December 2009 exchange rate)

13. PricewaterhouseCoopers Page 13 Number of domestic IPOs on the WSE main market by % of equity offered (2006-2009) Experiences from Warsaw Source: PricewaterhouseCoopers, prospectuses and current reports of listed companies

14. PricewaterhouseCoopers Page 14 Average cost of domestic IPOs on the WSE main market by offering value (2006-2009)* Experiences from Warsaw Source: PricewaterhouseCoopers, prospectuses and current reports of listed companies * Translated from PLN to EUR using 4.1082 PLN/1€ exchange rate (end-December 2009 exchange rate), does not include underwriting fees (if any)

15. PricewaterhouseCoopers Page 15 WSE key success factors Strong market institutions and regulations Pension funds in Poland invest up to 40% of their assets in equities of the companies listed on the regulated market Large individual investor base Privatisation of the biggest state-owned enterprises through an IPO Relatively large internal market Ability to compete with London and other exchanges for the biggest CEE companies Poland’s resilient economy Experiences from Warsaw

16. PricewaterhouseCoopers Page 16 Agenda Recent IPO trends Experiences from Warsaw Privatisation through the WSE 

17. PricewaterhouseCoopers Page 17 Privatisation through the Warsaw Stock Exchange (WSE) Ciech, KGHM, PKN Orlen, PKO BP, PZU, ….. Interesting examples where the Treasury managed to: increase management effectiveness through privatisation reduce the Treasury’s ownership below 50% ensure high free float retain control over the strategically important companies ensure high transparency As a result of the privatisation process: The WSE helped the Treasury privatise companies The Treasury helped the WSE increase its capitalisation and attract domestic and foreign investors Experiences from Warsaw

18. PricewaterhouseCoopers Treasury’s ownership of selected companies privatised through the WSE Page 18 CompanyShareholderOwnership (% of capital) PKN OrlenAVIVA OFE5.08% Oil&gasING OFE5.17% Treasury27.52% Free-float62.23% KGHMTreasury31.79% MiningFree-float68.21% PKO BPBGK Bank (state-owned)10.25% BanksTreasury40.99% Free-float48.76% PZUEUREKO B.V.12.99% InsuranceTreasury45.19% Free-float41.82% CiechPZU OFE6.12% ChemicalsPioneer Pekao Investment Management SA19.64% Treasury36.68% Free-float37.56% Source: WSE, valid as of 17.05.2010 Experiences from Warsaw

19. PricewaterhouseCoopers Privatisation of banks through the WSE The government’s strategy was to: privatise the banks ensure that banks will go public and stay listed on the WSE sell strategic stakes to foreign banking groups to ensure the transfer of know-how The aim was to: increase the banks’ efficiency open up a new source of capital ensure high transparency of banks (acting as public companies) limit the ability to transfer of funds (e.g. during crisis) to foreign headquarters, due to the transparency and rules applicable to public companies promote corporate governance Page 19 Experiences from Warsaw

20. PricewaterhouseCoopers Page 20 Privatisation of the largest banks in Poland Experiences from Warsaw Name of the bank before privatisation Year of privatisation Method of privatisation BRE Bank1992 IPO WBK1993 IPO Bank Śląski1994 IPO Bank Przemysłowo Handlowy1995 IPO Bank Gdański1995 IPO Bank Ochrony Środowiska1996 IPO, state-controlled Powszechny Bank Kredytowy1997 IPO Bank Zachodni1999 Sale to strategic buyer, IPO Powszechny Bank Gospodarczy1999 Merger with Bank Pekao Bank Depozytowo Kredytowy1999 Merger with Bank Pekao Pomorski Bank Kredytowy1999 Merger with Bank Pekao Bank Pekao1999 IPO Bank PKO BP2004 IPO, state-controlled Bank Gospodarki Żywnościowej2004 strategic buyer, planned IPO Bank Gospodarstwa Krajowego state owned Source: nbp.pl

21. Thank you! Tomasz Konieczny Partner tomasz.konieczny@pl.pwc.com +48 502 18 42 85 +48 22 523 42 85 © 2010 PricewaterhouseCoopers. All rights reserved. “PricewaterhouseCoopers” refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). 