Transcript Qatar Exchange

Qatar Exchange
April 2012
Misnad Al-Misnad
CRD Director
www.qe.com.qa
www.qe.com.qa
Qatar: a snapshot
Foreign affairs
 Qatar is member of the GCC, UN, OPEC, WTO, IMF
 Host of FIFA World Cup 2022
Population2
 21.3% annual growth 2004-2010 to reach 1.7
million
Oil & gas3
 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)
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QE History
1997 First day
of trading of
securities at
Doha
Securities
Market (DSM).
2005 NonQataris
permitted to
invest in up to
25% of the
shares offered
for trading.
2001 Start of
electronic
trading project
to replace
manual trading
systems.
1998
Introduction of
the Central
Registration
System.
1999 Investors
were able to
sell their
purchased
shares on the
next day
following their
purchase (T+1)
2009 Signed
strategic
partnership
agreement with
NYSE
Euronext to
transform
Qatar
Exchange into
world-class
market.
2002 Investors
able to sell
their purchased
shares on the
same day;
approval of a
new market
index
2007 Became
correspondent
of World
Federation of
Exchanges
(WFE).
April 2011
Implementation of
DVP
Connectivity
December 2011
T-Bill market
2010 launched
NYSE
Euronext
Universal
Trading
Platform
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QIA - QE - NYSE Euronext partnership
80% shareholding of QE through
Qatar Holdings
20% shareholding of QE
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 Country’s 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
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QE Strategy
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Develop a successful regional and international exchange with strong domestic roots
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Offer diversified range of investment and trading opportunities for investors and members
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Provide access to domestic and international investors for listed companies from Qatar and
abroad
Competitive Advantages
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Strength of the economy
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Support and commitment from State of Qatar to reform financial & regulatory system
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Partnership with NYSE Euronext
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QE Strategy
• Best trading environment UTP
• Liquidity providers
• Lending & borrowing
•CCP
•New trading opportunities
•Efficient post trade system
Broaden membership base
• Local Bank
• DMA
•Lower barriers to entry
• Companies disclosure and IPOs
meet the international standard
• Corporate actions
• Indices
• Cash market: ETFs & bonds
• MSCI
• Education & Training
• Trading hours
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QE: a snapshot
Growth 2004-2011
 Over 200% growth in the market cap
 Over 270% growth in number of annual transactions
Investors
 Foreign institutions account for 23% of the annual trading
turnover
 Qatari institutions account for 29% of the annual trading
turnover
 Over 1200 foreign institutions and funds investing in QE
stocks directly
QE has been the best performing market in the MENA region for two consecutive years (2010 and 2011)
7
QE Investors’ Demographics: a snapshot – 2011
Market Capitalization
Annual Turnover
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QE today
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42 listed companies and seven sectors
Total market cap: over $120 billion
QE Index covers 20 companies
Current Members ( Market Share by trading Value – 2011)
SWIFT in place between QE, custodians and QCB
UTP successfully implemented – Sept 2010
QE is member of the , AMEDA, IOSCO, Arab Exchange
Union , WFE
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The QE Central Registry Department (CRD)
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Fully integrated within QE
25 Staff
Nasdaq-OMX Equator technology
3 Custodians: HSBC, Qatar National Bank,
Standard Chartered
Dual listing with ADSM(QTEL)
GDR
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The CRD’s Missions
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Investors Account Openings
Daily Clearing & Settlement Procedure
Cash-settlement Process with the QCB
Exempt (off-market) Transfers
Processing of Pledges and Court Orders
Monitoring & Managing of the Brokers’ Settlement Cap
Corporate Actions
Monitoring the Foreign & Single Ownership Limits
DvP & Fails Management
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Corporate Actions Management
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The corporate action season is normally Feb-Apr and
Jul-Aug
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Market has witnessed dividends, bonus issues, rights
issue, splits and mergers
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Record dates are announced and all trades are settled
prior to the record date
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Payment date is announced subsequent to ratification
of dividend in the AGM/Board meeting
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All trading is suspended on AGM date
- Resumed AGM + 1 for dividends and rights issue.
- Resumed AGM + 2 for bonus issues and splits.
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Dividends are distributed by the companies through
cheques ,wire transfers and (DDP) new initiative by QE
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The CRD updates the securities account holdings
against confirmation received from issuer companies
in the event of bonus, rights, IPOs etc…
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Current Settlement Model (BIS Model II)
Settlement Cycle T+3
1.
2.
1
2
Trade
Execution
3
Settlement
Bank (QCB)
Clearing
4.
Commercial
Banks
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3.
CSD – Depository / Registry
5.
A transaction between a buyer and
seller is matched and its terms
(ie, price, quantity, settlement date)
are agreed upon
Computation of the obligations of
each the buyer and the seller is done
by the CRD.
Cash obligations are communicated
to the settlement bank (the central
bank). The commercial banks hold
settlement accounts of the brokers.
Registration department, acting as
record-keeper of securities, transfers
ownership of the traded securities
(depository/registry)
Depository
Participants
or
Custodians, acting as safe-keeper of
assets, and reports positions. Can
participate in settlement process
arranging transfer of securities and
cash for the settlement process.
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Depository Participants / Custodians
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The CRD in Numbers (2011)
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9,371 Exempt Transfers
1,540 Pledges
3,694 New Accounts opened
197,287 Account issued statements
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2012 so far & still to come
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Successful DvP Implementation
Buyer’s Compensation Enhancement
New Custodians
Securities Lending Program
VaR-based Risk Management
SWIFT Developments
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THANK YOU