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BME and MiFID

BME and MiFID. Brussels, October 24 2007. Key operator in Europe 2007 european stock exchanges – Spain, 4th Exchange by size. Billions €. 1 o. 2 o. 3 o. 4 o. 5 o. 6 o. Place. BME ranks 4th in equity turnover. Source: federation of European Stock Exchanges (FESE). 30/04/2007.

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BME and MiFID

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  1. BME and MiFID Brussels, October 24 2007

  2. Key operator in Europe 2007 european stock exchanges – Spain, 4th Exchange by size Billions € 1o 2o 3o 4o 5o 6o Place BME ranks 4th in equity turnover Source: federation of European Stock Exchanges (FESE). 30/04/2007

  3. BME Versus Other Exchanges (capitalisation) € Mill. Source: BME, 06/06/07

  4. Source: FESE, Share Ownership Structure in Europe

  5. Source: FESE, Share Ownership Structure in Europe

  6. Three drivers for future Liquidity Technology Cost

  7. Turnover has been growing above the european average. SIBE turnover growth reaches 22% CAGR between 1999-2006

  8. Spanish corporate dynamism Market capitalisation (bill. €) and euro zone ranking May 1996 May 2007 #4 Telecomunic. #1 Top 8 : 46.0 bill. € Mket. cap. 21.6 bill.€ Turnover (jan.-may.) #11 Banks #1 #10 #6 Oil & Petrol #4 #3 #5 #6 Utilities Top 8: 407.8 bill. € Mket. cap. 468.9 bill. € Turnover (jan-may.) #7 #3 Textile /Distrib. n.a. #1 Transport #5 #3 Spanish companies have increased significantly their international presence through M&A, multiplying by nine the market cap and by more than twenty the turnover since 1996 Source: Bloomberg

  9. Highly liquid market spanish blue chips are the stocks with highest liquidity at UEM RK. Company January-Jul 2007 Daily Average Relative Weight in EuroStoxx50 (%)(1) Value (€ Bn.) Value (€ Bn.) 1 174,8 1,18 3,86% 2 151,4 1,02 3,31% 3 141,2 0,95 2,86% 4 117,7 0,80 2,90% 5 106,0 0,73 2,81% 6 104,5 0,71 3,50% 7 100,4 0,68 3,00% 8 98,9 0,67 3,12% 9 97,8 0,67 3,69% 10 90,1 0,61 0,82% 16 70,1 0,47 1,74% 25 49,8 0,34 0,98% Source: Bloomberg (1) As of 07/31/07

  10. Equity market: High growth in turnover Equity Turnover (SIBE) Highest-ever trading volumes on equity market (+61,6%) Record order volumes for a single trading day (28 feb) Technological capacity of SIBE increased threefold in January Advanced in the launch and trading of ETFs Consolidation of MAB as the market for SICAVs Record number of processed orders in 1Q 2007 : 19.2 Mill. (up +48.1 % from 1Q 2006) Billion € + 35.6% +62% Source: BME

  11. Spanish market historical growth “mid-caps” contribution to the increasing turnover Mid and small market cap turnover Turnover, excluded top ten stocks (bill.€) (*) Jan. - May. 07 Several spanish “mid-caps” are actively investing abroad and issuing shares in order to finance non-organic growth. Source: BME

  12. Highly liquid market BME: The Principal Market for Spanish Shares Weight of trading in Spanish Sharesabroad versus total traded in BME % (1) BME’s solid background and high liquidity makes BME the principal market for Spanish stocks During last years, BME has preserved and expanded spanish shares trading Source: BME (1) Increase due to Terra Networks Nasdaq’s listing

  13. International comparative of liquidity

  14. State-of-the-Art TechnologyCompetitive and In-House Developed Technology Reliable High performance; above 99.9% of availability Full on-line, back up systems Equity platform capacity increased three fold (January 2007) Competitive Capacity to absorb growing trading volumes Increasing sales of BME’s in-house systems Pioneer BME was the first international stock market to interconnect different stock exchanges (Madrid, Barcelona, Bilbao and Valencia) in 1989 In-house • In-house development: I) providing IT solutions for the entire value chain II) flexibility: fully customised, quick update and risk prevention

  15. Competitive Fee Structure Exchange Fees By Country 2006

  16. Fees Comparison Exchange Fees By Country 2006 (< 1 Basic Point)

  17. Fees Comparison Total Cost By Country 2006 (< 35 Basic Point)

  18. MiFID aspects for Exchanges • Pre Trade Transparency • Post Trade Transparency • Best Execution (for Investment Services Firms) • Transaction Reporting (special requirements for CNMV) • Orders large in scale • Deferred publication of Blocks • Competitors: Sistematic Internalisers and MTFs

  19. BME and MiFID • Excellent relation liquidity, cost and technology • Strong Competitive position in Best Execution • STP process in trading+settlement • Risk in market fragmentation due to new competitors IS and MTFs • But also new oportunities in data information, market access and client servises.

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