Misr For Central Clearing, Depository & Registry

1. Misr For Central Clearing, Depository & Registry Corporate Actions Automation to reduce risk Presentation AMEDA conference Alex., April 27th -29th 2009 Dr. Tarek Abdel Bary Managing Director

2. Contents • What is Corporate action means • Philosophy of introducing the service • Objective of Introducing the service • Types of the corporate actions • Cash dividends • Underwriting- Public offer- Private offer • Capital Increase - stock dividend • Capital Decrease • Privatization • Share swap • Managing the corporate actions risk

3. What is Corporate action means • Any event initiated by a corporation which impacts its shareholders When a publicly-traded company issues a corporate action, it is initiating a process that will bring actual change to its stock . • Corporate actions are typically agreed upon the company's board of directors and authorized by the shareholders. • Some examples are stock splits, dividends, mergers and acquisitions, rights issues 

4. Philosophy of introducing the service • MCDR is the sole company in the Egyptian market that provide the clearing, settlement and Depository services of the Egyptian Public traded securities as well as the consequent re-registration process for that reason MCDR has unique possibilities in delivering corporate action services, as well as assisting shareholders in the exercise of their rights. • MCDR provides a wide range of services relating to issuers' corporate actions and the exercise of shareholder rights.

5. Objective of Introducing the service • Best suited automated systems to support the variety of corporate action events • Cash & Stock Dividend • Capital decrease / increase • Coupon Payment • Stock Merger & Split • Automatic allocation of corporate action benefits to customer accounts based on the real position to obtain their proper rights accurately and on timely manner. • Provide investors with different means to cope with their different needs ( cheques – Bank transfer – swift- ….)

6. Types of the corporate actions MCDR represents the issuance company in various corporate actions events which processed through MCDR automated systems: MCDR Integrated systems Issuer instruction Dividends distribution Underwriting Public/ Private offer Capital increase Stock dividends Capital Decrease Privatization Share swap

7. Cash dividends process Issuer general ` assembly Decision (2) Request of cash dividends (1) (3) (6) Yes MCDR/ Aff. And Inf. Dept. Issuer Memo of Dividends bank acc Math and confirm data (5) Data entry of the request Data entry of the request Dividends bank (7) No notification (5) Registry Dept. Accounting Dep. (4) Cash Dividends memo (8) Notification with the transfer (9) permission Coupon department shareholders list in the record date (10) Posting

8. Cash dividends process Coupon department cheques SWIFT Bank transfer Outsight dividends banks (47 branch) covering the sate Issuing the dividends receipt up on submitted request Coupon Dep. Front office Coupon Dep. Back office Review & check ID card Filling the dividends request Issuing dividends receipt up to L.E. 50,000

9. Underwriting/ Public offer /Private offer (3) Verification of shareholders data Securities Accounting Dept. Aff. And Inf. Dept. (5) (6) Amendment of issue acc. issue acc. increase (2) Request (4) Capital increase memo + underwriters CD (7) Credit client acc. Issuer (1) Issuer general assembly Decision A T B T C T Issuer T

10. Capital increase / stock dividend (4) Capital increase memo (2) Request of Capital increase (3) Securities Accounting Dept. Aff. And Inf. Dept. Issuer Approval of execution (6) increase issue account (5) Initiate capital increase (1) Distribution (9) Issuer general assembly Decision 8 A T B T C T Issuer T (3) Notification of issuer admission Registry Dept. (4) Capital increase memo (7) preparing shareholders list in the record date EGX

11. Capital Decrease (4) capital decrease memo (2) Request (3) Issuer Sec. Acc. Dept. MCDR- Aff. And Inf. Dept. Execution approval letter (7) Initiate capital decrease (8) issue account decrease (1) Issuer general assembly Decision A T B T C T Issue acc. T Registry Dept. (5) capital decrease memo EGX (3) Notification Cash dividend Dept. (6) preparing shareholders list in the record date (9) Repatriation Payment

12. Privatization Canceling order (8) (1) Give Buying Brokers EGX (2) Register of Client orders order Credit Sett. Cash Account (4) Sending order (9) (7) Un sufficient cash (3) Securities sett. MCDR Clearing Bank (5) Sending cash balances (6) Compare orders with credit cash Cash Sett. No (9) yes

13. Issuer B C C C T T T Issuer A C C C T T T Aff. And Inf. Dept. Issuer (1) Request Share SWAP (2) Share swap memo Brokers EGX (5) Sending order Sec.acc.dept (4) Register of Client orders Un sufficient balance (3) Give orders (6) Check Balances Canceling order (7) (8) No Yes Share swap sett.

14. Managing the corporate actions risk Receipt of Corporate Action information. corporate action request be executed when the issuer submits the necessary authorized documents (Board of Directors or General assembly meeting decision) Distribution of Corporate Action information The issuer should notify the company with all related information accurately and on timely manner . Receipt of Corporate Action Instructions MCDR maintain a pro active client files for each Issuer MCDR has an efficient system of receiving and processing the issuer instructions information.

15. Managing the corporate actions risk Processing of Corporate Action Instructions All corporate instructions are processed on timely and accurately way to be able to managing the corporate actions effectively Clear statement of liability MCDR has the responsibly to compensate any client in the event of an error could result from wrong processing. Manual processing of the related data be limited to minimum level to reduce the likelihood of error as well as minimizing the potential losses

16. Any Question? Thank you t.Bary@mcsd.com.eg