Iraq Stock Exchange ISX 2013 Taha A. AL- Rubaye CEO Iraq stock exchange Taha.ceo@isx-iq

1. Iraq Stock Exchange ISX 2013 Taha A. AL-Rubaye CEO Iraq stock exchange Taha.ceo@isx-iq.net

2. Iraq stock exchange (ISX) was founded under the law No. ( 74 ) April 18, 2004, opened in June 24, 2004 .ISX not-profit, member-owned and self-regulatory organization (SRO). • ISX aims • Operate and regulate its members, and list companies in a manner that is consistent with the goal of protecting investors and promoting investor confidence in the market. • Promote the interests of investors in efficient, reliable, competitive, transparent and honest markets. • Organize and facilitate fair, efficient and orderly transactions in securities, including the clearance and settlement of such transactions. • Regulate its members’ dealings in securities-related services and transactions and define the rights and obligations of parties concerned and the means to protect their legal interests. • Assist in capital-raising for companies which either are listed, or which desire to list on the Exchange. • Engage, as appropriate, in investor education programs to educate potential investors about opportunities for investments at the Exchange. • Collect, analyze and publish statistics and information necessary to achieve the goals stipulated in this Law. • Establish and support contacts with the stock exchanges of Arab and international markets that may be beneficial to the development of the Exchange. • Undertake other services and activities necessary to support its objectives.

3. The ISX witnessed two periods of activity 1- Manual trading period, June 2004 - April 2009.2 - Electronic trading period, April 2009 to current ISX adopted manual trading since 2004 to trade the listed companies shares.Since 2009 ISX use the electronic trading system and the depository system equipped by NASDAQ OMXThe number of trading sessions became five sessions per week since November 2009. The clearing and settlement ( DVP) T+0.

4. ISX 2013 • The number of listed companies on the market ( 83 ) companies , ( 73) companies listed in the regular market according to the instructions No. (6 ), and ( 10) companies listed on the second market in accordance with the instructions No. (15). • Indicators in 2013 • Organize ( 231 ) trading session . • Trade ( 875.569 ) billion shares . • The value of shares traded ( 2,845 ) trillion dinars . • Execute ( 126 904 ) tickets . • The number of listed shares increased from ( 3,551 ) trillion shares in 2012 to ( 4,632 ) trillion shares during 2013 . • The market capitalization increased from ( 5,597 ) in 2012 trillion dinars to ( 11,476 ) trillion dinars in 2013 .

5. Non-Iraqis traded

6. ISX Index • ISX launch a new ( index ), ISX Price Index 37 in February 2013, adopted the exclusion of delist companies and weak trading , which was in the previous sample, and the addition of a new company representing the telecommunications sector. The value of the index in basis session was 100 points. The index closed at the end of February (120) points and valued at the last session of the year ( 113.15) points . The index lose at the end of the year (8%) .

7. The most important factors affecting the value of the ISX index in 2013 A. Increasing capital for the listed companies. The number of shares which they are listed after increasing the capital for the listed companies in 2013 was (1085 ) billion new shares , compared with 905 billion shares in 2012. According to the " inverse relationship between supply and the share price in the market" the prices gone down less than the increasing percentage, some of the shares price got up when they success using the capital (Working Capital) B. The activity for many investment portfolios for non-Iraqi reflected positively on the size of the liquidity in the market and expand the depth and market value. C. Met the standards and the requirements of the prevailing laws and instructions of the disclosure and compliance Notes auditors and observations of the Securities Commission in the classification and disclosure of the number of accounts in the annual data in the quarterly financial data . On the other hand a number of companies failed to contribute to the legal obligation to disclose in the right time which displayed the offense and suspended from trading on several occasions of the year after the expiry of the legal limit . So usually influenced by the market index in the second half of the year due to the failure of some companies to meet disclosure rules . D. The economic and political developments of local , Arab and international resolutions affected to shareholders and investors , Iraqis and non-Iraqis . Iraq is an important part of the political and security developments , especially in the face of terrorism and fight crime . E. Banks Shares acquired ratios of more than 70% of turnover and number of shares traded. However, small investors have in the industrial mixed companies shares large proportions, they have been affected due to the feet and the means of production, unskilled labor and flooding the market with goods from the neighboring countries.

8. Agreements 2013 • Real time data : ISX signed two agreements in 2013, the first one with Bloomberg and the second with Reuters to have ( Real Time Data) Services, which will be launched with the X-stream electronic system in June . • The third agreement with Iraq commercial satellite channel in IQT TV , December 2013 to broadcast services and dissemination of information to the trading session and launch bar prices Real Time Data . • Trading system: ISX Signed agreement with NASDAQ OMX on 28/06/2013, To upgrade the trading system to X-stream, which it will be launched in June 2014 . • Listing ISX have two types of list operations :a. Listed new companies. b. listed new shares for the listed companies (increase in the capital) .

9. Depository center IDC • The Iraq Depository, a division of the ISX opened to participation by the members of the Exchange subject to such terms and conditions as the Director of the Depository shall specify by rule, subject to the approval of the Board of Governors and the Commission. • The Depository aims • Promote the timely, safe and efficient settlement of securities transactions in accordance with the terms of those transactions. • Promote open and non-discriminatory access to clearance and settlement services. • Iraqi Securities Commission in 2008 decided " the IDC a special section inside the market for a while to take the body a decision to turn it into an independent entity , financially and administratively , to be open for the participation of any member in the market , and is managed and operated according to the conditions specified by the IDC manager be subject to the rules of the Board of Governors and the ISC . “

10. ISX plans 20141- Trading sessions A - Organization ( 232 ) trading session at a rate of five sessions per week .B - Monitor trades and transactions in accordance with the rules and instructions for electronic trading , insiders, disclosure. 2 - ReportsA - issuing ( 232 ) Bulletin report after trading sessions daily . And issuing weekly report and the issuance of (12) monthly report and bulletin.B - the issuance of the annual report in the first month after the end of the year. And published in the media and WebsiteT - Issue Companies guide to corporate data as 31/12/2013 in order to enable investors to follow the financial position of the listed companies . And broadcast on the website www.isx-iq.net addition to the publication of quarterly and annual data for listed companies to contribute and publish the decisions of public bodies upon receipt . 3 – Listed shares A - listing and trading of the new shares ( capital increase ) of listed companies after approval by the registrar of companies to amend the articles of incorporation . According to the decisions of public bodies of listed companies .B - follow non-listed companies to submit applications and documents included in accordance with the instructions, it is hoped to list number of banking companies not included in collaboration with the Securities Commission and the Central Bank of Iraq .C - Follow-up process of the transfer companies from the second market to the regular market when they match conditions for the transition .

11. 4 - Surveillance & Inspection a. Monitoring the determinants of trading and update Cap Formula on purchase orders for brokerage firms and not to exceed cash balances in the bank clearing account and the balance of investors T +0 , which is being updated data before and during the session , according to updates of deposit in a bank settlement . And control system users and data through Data Officer. And the discovery of irregularities in accordance with the instructions of the electronic trading negligent referral and follow-up to the Commission for listening and discipline.b. Control over the implementation of the instructions solvency of the brokerage firms and follow-up activities by the Department of oversight and scrutiny balances monthly, quarterly and annual final accounts of these companies and the implementation of the plans for monitoring the semi-annual all brokerage firms to check their documents , documents and authorizations trading , which includes periodic inspection ( semi-annual ) the sudden inspection and investigation of cases referred to the Commission for listening and follow-up referral to the disciplinary committee when there is evidence of the violation. 5 - Electronic Systems The electronic trading system X-Stream will be launched in the end of the first half of 2014. According to the plan of action with NASDAQ OMX. Depository IDC will developed after completion of design studies by NASDAQ OMX in accordance with the following steps :a - Establishing a separate CSD in accordance with law No. 74 of 2004.b - The completion of the work of the new X-stream CSD according to the expertise available in the ISX .c - enable Erbil stock exchange from exercising its activity in 2014 through the use of the current IDC (Equator) for a temporary period until the start of the work of the new system, X-stream CSD.

12. Capital Market in Iraq 2014 Iraq Stock Exchange Data Vendors Trading Brokerage Firms Workstations Depository Clearing Settlement Bank Settlement Bank Erbil Stock Exchange Brokerage Firms Workstations

13. Capital Market in Iraq 2015 Iraq stock exchange ISX Data Vendors Brokerage Workstations Settlement Bank CSD Clearing Brokerage Workstations Erbil stock exchange ESX Settlement Bank

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