gss newsletterissue 110, june 2010 4 dear clients it is my pleasure to present you, in the may issue...

GSSNEWSLETTERISSUE 110June 2010

Issue 110, June 2010

2

CoNTENTDEaR CLIENTS 4aUSTRIa 6CEESEG: Institutional Investors’ Demand Increasing Again 6

BoSNIa aND HERzEGovINa 7Fifth BLSE conference 7Debt reaches BAM 8.2 bn 7

BULGaRIa 9Further announcements to Bulgarian Stock Exchange’s Development Program 2010 – 2012 9

CRoaTIa 11Zagreb Stock Exchange Academy launched 11Croatian banks earn HRK 1.2 bn in Q1 11Croatia’s credit rating unchanged 11EBRD adopts new strategy for Croatia 12

CzECH REpUBLIC 13Commencement of Activities of Central Depository 13Turnovers on the money market in the week of 19 - 23 April 2010 14Turnovers on the foreign exchange market - survey conducted in the week of 19-23 April 2010 14

HUNGaRy 15Matolcsy Says Further Rate Cuts Justified and Necessary 15NBH Says Hungary Can Meet Maastricht Criteria Within Foreseeable Future 15

KazaKHSTaN 17Trades volume on KASE increased by 1.2% and made up KZT 8.7 trn (USD 59.1 bn) 17GS trades volume on KASE increased by 84.0% and made up KZT 550.7 bn (USD 3,736.8 mn) 17Repo transactions market volume dropped 2.9% and made up KZT 4.2 trn (USD 28.6 bn) 17

KyRGyzSTaN 18poLaND 19KDPW_CLEARPOOL – Enhanced Protection in the Settlement Guarantee System 19

RomaNIa 21Economy – Central Bank 21Economy 21The Romanian Pension Funds’ Association (APAPR) about the decision to reduce the contribution to the 2nd pier of the private pensions system 22


3

RUSSIa 23Central Bank Decreased the Refinancing Rate 23FFMS provision on derivatives types 23Central Depository concept 23The registrars could be added into the list of Companies Having Strategic Importance 24RTS shifts the trading session start time 24“Independent Director” concept should be finalised in the Law “On Joint Stock Companies” 24“Consolidated shareholders’ ” rights should be deprived 24Russian Eurobonds placement 24

SERBIa 25Serbia emerges from recession 25

SLovaK REpUBLIC 26Bratislava Stock Exchange Trading in April 26Revision of SAX Index Base 27

SLovENIa 28Think-Tank Says Higher Minimum Wage to Cost 5,000 Jobs 28Ernst & Young Forecasts 0.9% Growth for Slovenia 28

UKRaINE 30Leading Ukrainian banks with foreign capital to address authorities 30European Parliament approved EUR 500 mn of financial aid to Ukraine 30

yoUR CoNTaCTS 31DISCLaImER 34ImpRINT 35


4

DEaR CLIENTS

It is my pleasure to present you, in the May issue of our regional monthly Newsletter, the most recent developments around UniCredit Bank Hungary Zrt and also the Hungarian capital market.

The past weeks in Hungary were all loud about the parlia-mentary elections. After the second round of the general elections held on 25 April 2010, the center-right FIDESZ – KDNP alliance won two-thirds legislative majority, after being in opposition for eight years. No party has received such unambiguous and broad support since the changes took place in Hungary in 1989. This achievement also entails great responsibility for the new government. With this massive majority power in the Parliament the govern-ment will have the luxury to focus on longer term issues which will be able to determine potential growth in the Hungarian economy. To name the most important ones: to modify the operation of the public administration and the municipalities, health care and the social benefit system. The first key goals of the new government have been set to reduce tax rates, rationalize the administration, to improve the public safety in the countryside and to create a million of new jobs.

It is expected that the election results and the changes planned by the new government are considered as positive by the international financial markets and will have positive impact on our country.

UniCredit Bank Hungary Zrt. is one of the leading banks in Hungary, providing comprehensive and flexible serv-ices to medium-sized and large companies as well as private individuals, the self-employed and small enterprises through its countrywide branch network, which consists of 133 units.

Today UniCredit Bank Hungary Zrt. is not only the largest custodian bank in Hungary, with a EUR 19.5 bn client port-folio under its custody, but is constantly mentioned and rated by the major industry publications (Global Custodian, Global Investor, Global Finance) as the best quality service provider in Hungary and in the Emerging Markets since 1999. We personally appreciate the high scores and constructive criti-cism that came out of the survey results and will use it as a basis for future development.

UniCredit Bank Hungary Zrt. not only has a long-term com-mitment to stay in the custody business as leading provider but also puts a great effort to shape and to move the market in order to create an investor friendly environment.

One of our success factors has always been the high stand-ard of service to clients, adjusted flexibly to the constantly changing market and to the demands of clients who are determined to keep up with the changes. Currently our team is working on implementation of new products and services which could give added value to our precious clients, and which would differentiate us even more from our competitors in the market. One of these new services is the Settlement Agent function that we offer for remote clearing members of the Budapest Stock Exchange.

By this development UniCredit Bank Hungary is the first local custodian bank to take advantage of the recent enhancement carried out by the Hungarian Central Clearing House and Depository (Budapest) Ltd. (“KELER”), which allowed for the separation of the clearing and settlement activities and intro-duced the Settlement Agent role in the Hungarian market. This development practically means that settlement of stock exchange transactions can be performed on the cash and securities accounts of the Settlement Agent instead of the clearing member’s direct accounts at KELER, while from risk point of view it is still the direct clearing member who is fully responsible for complying with the rules and responsibilities of the members of the clearing system.

Júlia Romhányi (Head of GSS in Hungary)


5 Dear Clients

GSS Hungary has also set up a professional securities lend-ing desk serving both international and domestic clients. UniCredit Bank Hungary offers securities lending and borrow-ing services under specially agreed conditions based on its lending pool. UniCredit Bank Hungary managed to contract all significant stock exchange members on the borrowing side, as well as sizeable domestic institutional investors to become lenders in the securities lending program. UniCredit Bank Hungary’s widening its market presence on the borrow-ing side, our tight operational controls and our well-known client oriented solutions attract more and more partners into the system. Securities lending will soon become one of the most important element of our services, where our clients will always be able to lend and borrow securities with confidence.

Similarly to other European countries, Hungary will face chal-lenges in the upcoming years, especially in connection with the implementation of the Target2Securities, the roll-out of the common XETRA trading system within the CEESEG group and the possible centralization of the CCP function. These developments will put us into a very different and competitive environment, where our goal will remain to be a highly qualified service provider.

We, the Global Securities Services team of UniCredit Bank Hungary, are all committed to generate value for our custom-ers. As a member of a leading European banking group, we are dedicated to further development of our services so that we become the number one custodian services provider not only in Hungary, but with our standardized products, throughout the CEE region.

Best regards,

Júlia RomhányiHead of GSS in Hungary


6

Market Capitalisation EUR 80.9bn

YTD Dev. of Market Capitalisation 2.1%

Number of SE Transactions p.m. n.a.

YTD Dev. of SE Transactions n.a.

SE Turnover (Vienna SE) EUR 4.0bn

Monthly Index Performance (ATX/VSE) -2.2%

GDP per Capita (2010 in EUR) 33,738

GDP Real 2010 (Change against prev. year in %) 1.3

3-Month Money Market Rate (current in %) 0.64

Inflation in 2010 (yearly average in %) 1.8

Upcoming Holidays none

Source: Thomson Datastream

Source: Bank Austria, National Statistics

aUSTRIa

1750

2000

2250

2500

2750

3000

Mai

Jun

Jul

Aug

Sep

Okt

Nov

Dez

Jan

Feb

Mrz

Apr

Mai

Actual 38 Day moving average 200 Day moving average

CEESEG: Institutional Investors’ Demand Increasing AgainThe institutional investors’ demand for the companies listed on the member exchanges of CEESEG is growing again after the difficult market situation following the financial crisis. Especially investors with a higher exposure to Central and Eastern Europe (CEE) have increased their positions in the member exchanges of CEESEG, just as institutional investors with a value focus. These are the main findings of a recent study conducted by the information provider, Ipreo.

In the second half of 2009 the combined free float of issuers listed at the CEESEG-Exchanges Vienna, Budapest, Ljubljana and Prague increased to USD 87.8 bn (total market capitali-zation per December 2009: USD 200.9 bn), driven by positive price effects and the rally in the calendar year 2009. 76.5% is held by domestic and foreign institutional investors, 6.1% by non-financial strategic institutions, and 17.4% by domestic private households.

The study also shows that within the group of institutional investors 86% of the shares are held by international insti-tutional investors. On CEESEG average, the largest interna-tional institutional investors in the CEESEG exchanges come from the US (30.4%) and the UK (16.2%), followed by Austria (10.7%), Germany (7.7%) and France (4.8%).

Overall, growth investors predominate, value investors increased their stake, followed by GARP (growth at a reason-able price) institutions. The predominant type of investor has low to moderate turnover ratios (the turnover ratio indicates how often institutional investors switch securities within their overall portfolios on average per year), which implies that the positioning in the markets of CEESEG is generally long-term.

Source: Wiener Borse

Impact on investorsFor information purposes only.

Written and edited by: Thomas Rosmanitz Head of Relationship Management AustriaTel. +43 50505 58515 · [email protected]

mailto:[email protected]


7

Source: Bloomberg

Market Capitalisation (Sarajevo SE) BAM 7.6bn


Number of SE Transactions p.m. 1,946

YTD Dev. of SE Transactions -27.0%

SE Turnover (SASE) BAM 7.3mn

Monthly Index Performance (SAX-10/SASE) -0.4%

Market Capitalisation (Banja Luka SE) BAM 3.7bn

YTD Dev. of Market Capitalisation -2.2%



SE Turnover (BLSE) BAM 18.5mn

Monthly Index Performance (BIRS/BLSE) -0.2%


GDP Real 2010 (Change against prev. year in %) -1.0

3-Month Money Market Rate (current in %) n.a.


BAM/EUR 1.98


BoSNIa aND HERzEGovINa


900

1000

1100

1200

1300

1400

Mai

Jun

Jul

Aug

Sep

Okt

Nov

Dez

Jan

Feb

Mrz

Apr

Mai


Fifth BLSE conferenceThe Banja Luka Stock Exchange organized the Fifth Inter-national BLSE Conference in Banja Luka on 20 May. The one-day conference held at the Bosna hotel featured several panel discussions and presentations about:

1. Exploring the achieved level of corporate governance that will be done in cooperation with the Economic institute

2. Relationships with investors in crisis periods

3. Presentation of the companies (Telekom Serbia, Nova Bank, Elektroprivreda)

4. State and perspectives of development of institutional investors (presentations and discussions of regulators in connection with investment and Voluntary Pension Funds and the role of insurance companies in the capital market)

5. Development and application of new technologies on the Banja Luka Stock Exchange (the introduction of FIX pro-tocol, technology exports to regional markets)

The main aims of the Conference are:

1. To inform the participants of the RS and B&H capital market about the current key questions in development of the capital market, as well as influence to start key reform projects for the development of the capital market;

2. To inform the representatives of domestic investors and institutional investors about investment opportunities on the RS and B&H capital market, with the current and excepted development in RS market.


Debt reaches BAM 8.2 bnThe total debt of B&H as of 31 December 2009 reached BAM 8.23 bn, of which BAM 5.2 bn was the external debt and BAM 3.03 bn the internal debt, a report adopted today by the Council of Ministers reads.

A share of the public debt in the GDP was 35% last year, which means below the 60% allowed by the Maastricht cri-teria. Based on these data, it can be said that B&H is in the group of moderately indebted countries, Chairman of the Council of Ministers Nikola Spiric said today.


8 Bosnia and Herzegovina

The report further shows that B&H’s external debt grew by 18.5% in comparison with the previous year; the increase had directly to do with the disbursement of the first portion of IMF’s funds under the stand-by arrangement. International financial institutions account for 60% of B&H’s external debt (39% World Bank, 7% EIB, IMF and EBRD, each).


Written and edited by: Amra Telacevic Relationship ManagerTel. +387 33 562 816 · [email protected]



9

Market Capitalisation BGN 10.5bn




SE Turnover (Bulgarian Stock Exchange) BGN 89.0mn

Monthly Index Performance (SOFIX) -3.7%





EUR/BGN 1.96


BULGaRIa



300

350

400

450

500

550

Mai

Jun

Jul

Aug

Sep

Okt

Nov

Dez

Jan

Feb

Mrz

Apr

Mai


Further announcements to Bulgarian Stock Exchange’s Development Program 2010 – 2012…in addition to the previous publication

5. REGULATORY AMMENDMENTSThe Exchange will take an active part in all discussions on the necessary legislative changes in the field of trade in financial instruments and will initiate such discussions as the need arises. The Exchange is particularly of the opinion that the regulatory amendments listed below are necessary and is ready to actively contribute expertise to this end:

■■ Comprehensive review of Ordinance No 16 of the FSC on the conditions and procedure for execution of margin purchases, short sales and lending of financial instruments

■■ Amendments to Part III, Chapter 9 of the POSA concerning the activity of the Central Depository and to Ordinance No 8 of the FSC, regulating in detail the clearing functions of the Central Depository

■■ Amendments to the State Fund for Guaranteeing the Stability of the State Pension System Act (Art. 13 (8)), enabling the investment of fund’s means in local financial instruments

■■ Amendments to Part IV of the POSA concerning the activ-ity of the collective investment schemes and to the respec-tive subordinate legislation, which would allow structuring of funds outside the limits, set by the UCITS directives. This amendment would enable the organisation of ETFs based on local and foreign indices under more liberal lim-its with respect to the mandatory diversification of the respective fund.

Deadline: The second quarter of 2010

Partners: The Financial Supervision Commission (FSC), the Ministry of Finance and all Supporting organisations

6. CORPORATE GOVERNANCE OF PUBLIC COMPANIESThe improvement of the corporate governance quality of the public companies is one of the main priorities of BSE-Sofia. In recent years, the Exchange has taken a series of actions aimed at promoting the principles and good prac-tices of corporate governance. BSE-Sofia has developed and adopted its own Corporate Governance Code and has actively contributed to the development of the National Cor-porate Governance Code to be applied to the territory of the country. The Exchange is also a co-founder of the Bulgarian National Corporate Governance Committee and has put into practice the principles and recommendations of the National Corporate Governance Code.


10 Bulgaria

The Exchange will further:■■ Continue initiating and participating in programs and events connected to the corporate governance of Bul-garian public companies and will encourage the issuers to actually apply the principles laid down in the National Corporate Governance Code.

■■ BSE-Sofia will actively take part in the work of the Bulgar-ian National Corporate Governance Committee, which is in charge of making revisions of the National Code and evaluating the state of the corporate governance in the country on an annual basis.

■■ The Exchange will continue the initiated discussion (end of 2009) with the National Corporate Governance Committee regarding the establishment of an Exchange index com-prising the companies with good corporate governance by extending the number of participants involved in the discussion and summarizing the standpoints. The period set for the accomplishment of this target is the end of the first half of 2010.

■■ The Exchange will create a concept for the establishment of awards for best corporate governance and for market performance and active trading until the end of the third quarter of 2010.

7. IMPROVEMENTS IN THE CORPORATE STRUCTURE OF THE COMPANYWith a view to a new image and improvement of the BSE-Sofia communication with the rest of the institutions and market participants, the Exchange will take the following steps:

■■ By the end of the first half of 2010, BSE-Sofia will establish a practice for carrying out monthly panels involving the community of intermediaries and representatives of the capital market associations.

■■ BSE-Sofia will strengthen its existing international relations and will establish new ones at European and regional level in order to ensure the proper positioning of the local market among the other regulated markets and alliances.

■■ The Exchange will reconsider, update and put up for dis-cussion the fees and commissions payable by issuers and members, as mentioned above in this Strategy.

■■ BSE-Sofia will take steps towards transformation of the Exchange into a public company, in case this coincides with the privatization strategy for the state-owned stake in the capital of BSE Sofia and with the opinions of the potential strategic investors.

■■ Until the end of 2010, the Exchange will modernize the system for collection and submission of information to the exchange members with regard to their day-to-day operations with a view to change over to a wholly elec-tronic service.

■■ BSE-Sofia will analyze and discuss the necessity of a new statute by the end of the second quarter of the year. The Statute will be then proposed for approval to the Annual General Meeting of the Exchange.

Impact on investorsThe completion of this development program has a direct impact on investors.

Written and edited by: Veselin Stefanov Manager Sales & Relationship ManagementTel. + 359 2 93 20 112 · [email protected]



11

CRoaTIa

Market Capitalisation HRK 182.2bn



YTD Dev. of SE Transactions 0.4%

SE Turnover (Zagreb SE) HRK 1.358.9mn

Monthly Index Performance (Crobex/ZSE) 0.9%





EUR/HRK 7.27

Upcoming Holidays 3, 22, 25 June



1400

1600

1800

2000

2200

2400

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Zagreb Stock Exchange Academy launchedThe Zagreb Stock Exchange launched an academy which will provide training and promote knowledge on the Croatia capital market. Its director, Melita Marceta, said that the Academy was intended for all present and future players on the financial market, from small to institutional investors. The Academy’s training system is based on a series of basic and specialised courses prepared in cooperation with the Span-ish Stock Exchange (BME). Javier Amo of the BME said that financial education was important both for professionals and for ordinary citizens because they would be able to learn more about capital markets so that they could better manage their finances. The project was funded by the European Bank for Reconstruction and Development (EBRD).

Impact on investorsFor information purpose only.

Croatian banks earn HRK 1.2 bn in Q1In the first three months of this year, banks in Croatia recorded a combined gross profit of slightly over HRK 1.2 bn, according to preliminary data released by the Croatian National Bank. This is 9.6% or HRK 129.3 mn less than in Q1 2009. The total asset of Croatia’s 32 banks amounted to HRK 373.98 bn at the end of March. The average capital adequacy rate in the first three months was 18.95%. Twenty-five banks posted a profit, while seven banks posted a com-bined loss of HRK 45.2 mn. Zagrebacka Banka (ZABA) is the leader with a gross profit of HRK 348.4 mn. Privredna Banka Zagreb (PBZ) follows with HRK 229.4 mn. Consequently, the two leading banks account for slightly over 47% of the total gross profit in the industry. Raiffeisenbank Austria is third with HRK 150.3 mn, followed by Erste & Steiermärkische Bank with HRK 147.3 mn, Hypo-Alpe-Adria-Bank with HRK 135.2 mn, and Societe Generale-Splitska Banka with HRK 93.6 mn.


Croatia’s credit rating unchangedDun&Bradstreet (D&B), an international provider of credit information and credit reports covering over 130 countries, again assigned DB3d country risk indicator to Croatia, which puts it among the countries with slight risk and stable rating trends.



12 Croatia

EBRD adopts new strategy for CroatiaThe European Bank for Reconstruction and Development (EBRD) Board has adopted a new strategy for Croatia designed to support the country’s further development and anticipated membership of the European Union by address-ing the key needs of the Croatian economy.

Croatia is making continued progress in the implementa-tion of structural and institutional reforms that are key in this decisive stage of EU accession negotiations, the bank said in the strategy.

Regarding the institutional and economic challenges Croatia must face before joining the EU, the strategy mentioned fur-ther improvement of the business environment, privatization of state-owned companies, commercialization of infrastruc-ture, and improving skills and labour force flexibility.

The EBRD said that over the next three years covered by the strategy, the Bank will support the country’s EU aspirations through its activities in Croatia, helping to address the out-standing challenges and to catalyze faster economic growth.

The Bank will also continue to promote the development of enterprise by financing investments to improve competi-tiveness, and to support the regional expansion of Croatian companies via loans, credit lines for the trade sector, and equity investments. Support of energy efficiency projects is also included in the bank’s strategy, with a focus on the corporate sector by helping companies raise their environ-mental standards and encouraging foreign direct investment via risk-sharing tools.

The EBRD will underscore investment in tourism and the development of agribusiness.

In infrastructure, the EBRD will cooperate with other financial institutions in the financing of key transport links and work with local and regional authorities in Croatia in the preparation of wastewater and solid waste projects to be co-financed with EU funds.

The Bank’s priorities are investments in the diversification of energy supply and in renewable and energy efficiency.

Impact on investorsNew strategy of the EBRD is aimed at supporting Croatia‘s further development and anticipated membership in the European Union.

Written and edited by: Snjezana Bruncic Relationship ManagerTel. +385 1 6305 400 · [email protected]


13

Market Capitalisation CZK 1.4trn




SE Turnover (Prague SE) CZK 87.1bn

Monthly Index Performance (PX) 6.62%





EUR/CZK 25.61



CzECH REpUBLIC


800

900

1000

1100

1200

1300

1400

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Commencement of Activities of Central Depository On 5 May 2010, the SCP has published an official press release informing about the commencement of activities of the Central Depository and the consequences it shall have on the clients of SCP:

“On 30 March 2010, the Ministry of Finance and the Cen-tral Securities Depository Prague Company (hereinafter “the CDCP“) approved the document “Project of the SCP Records Transfer“ (hereinafter “the Project“), following the contract on the SCP records transfer, concluded on 8 December 2009. The Project confirms, among others, the deadline of the transfer of the SCP records to the CDCP at the beginning of July this year.

In order to minimize adverse effects for the SCP clients, it was necessary to take some unavoidable organizational meas-ures. The time schedule of the transition period of the SCP records transfer and the commencement of the CDCP opera-tion presumes the termination of the acceptance of requests for SCP services on Friday 25 June 2010. For the period of 26 June – 2 July 2010, a technical pause is scheduled relat-ing to the transfer of the SCP records to the CDCP. Starting 7 July, the opening of the CDCP operation is envisaged.”

As far as the data transfer from SCP to new CDCP is con-cerned, there is no impact on clients. The SCP accounts will migrate under the same account number including the whole portfolio in the first transition wave and will be ready for the settlement on 7 July 2010.

Regarding the impact on daily business, please be informed that the last operational day of SCP will be on 25 June 2010, this will be the standard settlement day, all trades matched to be settled on this day will be normally settled. In terms of standard T+3 settlement cycle it means that the last trade date for the settlement through SCP will be on 22 June, but of course, as the settlement cycle for OTC transactions is negotiable, T+0 trades instructed on 25 June will be settled as well.

All trades matched to be settled between 28 June and 2 July (it means with the settlement date during the week from 28 June to 2 July) will be settled on 7 July, this is the first pos-sible settlement date as there will be public holidays on 5 and 6 July. The trades´ settlement will be just suspended and all these matched trades will be waiting for the first possible set-tlement date after the technological break. The trading and matching will not be affected. All these limitations relate only to the domestic book entry shares (except t-bills). The foreign issues and also T-bills will not be effected. The Prague Stock Exchange will be open for business during the period con-cerned according to the valid timetable, without any changes.


14 Czech Republic

Please note that regarding the correct quotation of the PSET field in swift instructions, the BIC for the Czech book-entry shares STCUCZP1 should cease its existence as of 7 July 2010 since the current depository for the Czech book-entry shares, i.e. SCP, will also cease to exist. Thus the follow-ing PSET fields shall be applicable to the Czech market: UNIYCZPP (BIC code of CDCP – formerly UNIVYC) – for Czech as well as foreign issues traded in the Czech market, and CNBACZPP (BIC code for the Czech National Bank) for T-Bills. We realise this might be a change our clients will have to get accustomed to, and as the PSET is not relevant to the STP procedure (except of cross-border trades), instructions with an incorrectly specified PSET filed will be processed anyway.

Source: scp.cz

Impact on investorsSettlement of the Czech book entry securities will be unavailable in the period 25.6.2010 – 2.7.2010, i.e. the settlement will be renewed on 7 July, when all outstand-ing trades will be duly settled. The BIC code for the Czech book entry shares STCUCZP1 (used in the PSET field) should cease its existence as of 7 July 2010.

Turnovers on the money market in the week of 19 - 23 April 2010In the week of 19 - 23 April 2010 a regular survey was con-ducted on the daily average turnovers on the money market. This survey, with participation of all relevant domestic banks trading on the money market, is carried out by the Czech National Bank regularly four times a year – always in January, April, July and October.

As compared to January 2010 figures the daily average turno-ver of deposit operations decreased from CZK 51.7 bn to CZK 42.9 bn, which was driven mainly by the decrease in O/N trades with non-residents.

The most significant among deposit operations were deposit operations with the maturity up to 1 week (97%), in particular O/N operations comprising 84% share of the total turnover. The turnover of repo operations went up significantly and their share on the total turnover grew from 2.4 to 8.6%.

The turnover of derivative transactions IRS (Interest Rate Swap) dropped by 51% compared to the last survey. The FRAs (Forward Rate Agreement) were not traded in the reviewed period. Most of the derivative transactions (97% of the volume) was traded with non-residents.


Turnovers on the foreign exchange market - survey conducted in the week of 19-23 April 2010The Czech National Bank surveys the average daily turnovers on the foreign exchange market quarterly – in January, April, July and in October. In the most recent survey conducted in the week of 19-23 April 2010 the daily average turnover increased by USD 1,274.7 mn (+20.1%) to USD 7,624.3 mn compared to October 2009.

According to information provided by the reporting banks the activity in the surveyed period was average.

Edited by: Dita Šafárová Relationship ManagerT. + 420 221 216 772 · [email protected]

Apr 2010 Jan 2010 Change

Total turnover 7,624.3 6,349.6 20.1%

Spot transactions 1,095.4 1,139.1 -3.8%

Forwards and swaps 6,470.9 5,094.3 27.0%

Options 58.0 116.2 -50.1%

Data in million USD

Source: cnb.cz




15

Market Capitalisation HUF 18,640.0bn




SE Turnover (Budapest SE) HUF 855,069mn

Monthly Index Performance (BUX) -0.5%





EUR/HUF 272,70



HUNGaRy


11000

13500

16000

18500

21000

23500

26000

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Matolcsy Says Further Rate Cuts Justified and NecessaryThe National Bank of Hungary’s (NBH) Monetary Council has cut the base rate at each of its meetings since the beginning of 2009, bringing it to a historical low of 5.25%. Referring to the decreasing trend in rates, Mr György Matolcsy, the Fidesz-KDNP alliance’s candidate for economy minister, said that the new government’s goals cannot be reached without further reduction of the base rate. The aim is to get banks to take liquidity out of the NBH’s two-week deposits and use it for lending, he added.

According to Matolcsy, the government and the central bank have to cooperate and could even begin a joint program to start growth. The economy minister, as the author of the country’s financial policy, has to cooperate with the central bank governor, he added.

Reducing the level of state debt, achieving a sustainable gen-eral government deficit and adopting the euro are the three main tasks of financial policy. The new government aims to create 1 mn jobs in ten years with the tools of employment policy. It wants to restart economic growth and take steps to boost investment growth. Outlining the new government’s three-year tax cut program, the emphasis would be placed on consumption- and sales type taxes, while reducing tax on income. Hungary’s taxes on labor, income tax and payroll tax, are far higher than in neighboring countries.

Impact on investorsFurther decreasing base rate can be a good basis for reaching the new government’s goals.

NBH Says Hungary Can Meet Maastricht Criteria Within Foreseeable FutureAccording to the Governor of the National Bank of Hungary (NBH), Mr. Simor, Hungary’s annual government deficit will drop below the stipulated maximum of 3% of GDP, which is necessary for euro convergence within the near future, adding that although government debt is currently above the maximum 60% of GDP, this figure will begin to drop at the beginning of 2011. The NBH governor noted that Hungary will be able to meet the inflation requirement contained in the Maastricht criteria as well.

Mr. Simor remarked that developments, since the outbreak of the global financial and economic crisis in 2008, have reinforced the central bank’s conviction that Hungary stands to benefit from euro convergence, cautioning, however, that adoption of the single European currency will not solve all the country’s economic problems as the recent debt crisis in Greece demonstrates.


16 Hungary

Hungary’s government must continue to pursue disciplined budgetary policies in order to spur growth within the private economy and reduce vulnerability stemming from high gov-ernment debt. Measures aimed at increasing competitiveness and efficiency will also be necessary to accelerate the process of euro convergence.

The governor of NBH commented that monetary policy cannot, in itself, stimulate long-term economic growth, adding that the NBH can help impel growth through the establishment of a stable, low-inflation economic environ-ment. Lower growth and heightened risk-aversion will be long-term effects of the crisis. Vulnerable countries, such as Hungary must change their economic growth models in order to make them less dependent on external financing.

Mr. Simor characterized the notion that a robust forint is bad for Hungary’s economy to be a widespread misconception, noting that forint weakness eventually results in higher infla-tion and wages.

According to NBH, Hungary’s public and external debts are the key to sustainable growth and successful euro adop-tion. The benefits of adopting the single European currency can only be exploited if backed by sustainable, stable and disciplined economic policy.

In the past, the pick-up in economic growth was often asso-ciated with a sharp deterioration in external balance. The financial crisis, however, revealed the un-sustainability of this growth model. Consequently, Hungary’s convergence will only be successful if economic growth is financed by a greater proportion of domestic savings in the future.

The Hungarian economy is sensitive to the crisis through two channels. First, due to the cautious attitude of inves-tors and the high level of domestic debt, the country may find it more expensive and harder to access credit than in the past. Second, the slow expansion in Hungary’s export markets makes it more difficult to reduce debts accumulated in previous years. For this reason, the economy may remain vulnerable to financial shocks for quite a long time, even if it pursues a disciplined economic policy, NBH said.

Reducing the country’s vulnerability requires a fiscal policy which does not act as a drain on domestic savings and, consequently, savings can be made available to finance the private sector. However, a tight fiscal policy is a necessary but not sufficient condition for this. It will also be indispensable to restructure the government budget, in order to improve the country’s competitiveness, i.e. to create the conditions for sustainable economic growth.

Hungary currently does not meet any of the Maastricht cri-teria. However, fiscal adjustment made necessary by the economic crisis may help fulfill the criteria relating to govern-ment deficit and inflation. Meeting the Maastricht criteria over the medium term is insufficient for successful euro adoption. A fiscal policy is required, which gives sufficient scope to manage economic shocks and contributes to the gradual reduction in the country’s high public and external debts. Anchoring inflation expectations is a key to meeting the infla-tion criterion on a sustained basis, NBH said in its report on the convergence process.

Impact on investorsAccording to the report of NBH, Hungary can meet Maas-tricht criteria within the foreseeable future, however, the country needs a new growth model to reach this goal.

Written and edited by Lívia Mészáros Sales & Relationship ManagerTel. +36 1 301 1921 · [email protected]


17

Market Capitalisation KZT 12,327.9bn




SE Turnover (KASE) KZT 11.2bn

Monthly Index Performance (KASE) 1,577.87





EUR/KZT 192,22


Source: Bloomberg

KazaKHSTaN


700

900

1100

1300

1500

1700

1900

2100

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Trades volume on KASE increased by 1.2% and made up KZT 8.7 trn (USD 59.1 bn) In the initial four months of 2010 the trades volume on Kaza-khstan Stock Exchange (KASE) in all market sectors made up KZT 8,712.7 bn (USD 59,131.4 mn) and increased relatively to the similar period of 2009 by 1.2% (decreased by 4.2% in USD).

In comparison with the previous four months period (Sep-tember-December 2009) the trades volume increased by 13.3 % (15.8% in USD).


GS trades volume on KASE increased by 84.0% and made up KZT 550.7 bn (USD 3,736.8 mn)In the initial four months of 2010 the government securities (GS) trade volume on the Kazakhstan Stock Exchange (KASE)* made up KZT 550.7 bn (equivalent of USD 3,736.8 mn) and increased against the same 2009 period by 84.0% (81.3% in USD).

In comparison with the previous four months period (Sep-tember-December 2009) trades volume decreased by 4.1% (2.5% in USD).


Repo transactions market volume dropped 2.9% and made up KZT 4.2 trn (USD 28.6 bn)In the first four months of 2010 the repo transactions market trade volume on Kazakhstan Stock Exchange (KASE) made up KZT 4,219.0 bn (USD 28,639.0 mn) and dropped against the similar 2009 period 2.9% (8.2% in USD).

In comparison with the previous four months period (Septem-ber-December 2009) trades volume gained 48.0% (50.7% in USD).

Impact on investorsFollowing information shows changes of the business activity in the Kazakhstan market from the beginning of the year 2010.

Written and edited by: Saltanat Adikhanova Relationship ManagerTel. +7 727 258 30 15 · [email protected]


18

KyRGyzSTaN

Market Capitalisation n.a.

YTD Dev. of Market Capitalisation n.a.

Number of SE Transactions p.m. 61


SE Turnover (KSE) KGS 21.5mn

Monthly Index Performance (KSE) 95.3

GDP per Capita (2010 in EUR) 1,457.19



Inflation in 2010 (yearly average in %) n.a.

EUR/KGS 58.09



In the beginning of the 2nd quarter of 2010 trades volume on three Kyrgystan trading grounds decreased by 7% and made up KGS 21.5 mn (USD 0.47 mn) with 61 trades provided. Trades volume on JSC “Kyrgyz Stock Exchange” made up KGS 0.91 mn (USD 0.02 mn) with 5 trades provided. Moreo-ver, trades volume on JSC “Kyrgyzstan Stock Exchange – BTC” made up KGS 0.60 mn (USD 0.013 mn) with 19 trades provided. Concluding with trades volume on JSC, “Central Asian Stock Exchange” made up KGS 20.026 mn (USD 0.44 mn) with 37 trades provided.

Impact on investorsFollowing information shows changes of the business activity in the Kyrgyzstan market for the beginning of the 2nd quarter of 2010.

Written and edited by: Zhanna Mussakhanova Leading specialist, Custody divisionTel. +7 727 258 30 15 (ext. 18-24) · [email protected]


19

Market Capitalisation PLN 456.698bn




SE Turnover (WSE) PLN 16.6bn

Monthly Index Performance (WIG20) 6.6%

Monthly Index Performance (WIG) 7.6%





EUR/PLN 3.99

Upcoming Holidays 3 June


poLaND


1500

1700

1900

2100

2300

2500

2700

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


KDPW_CLEARPOOL – Enhanced Protection in the Settlement Guarantee SystemFollowing our previous notifications concerning planned changes to the settlement guarantee system (you may refer to the January issue of our GSS Newsletter), please be kindly advised that on 18 May 2010 the National Depository for Securities (NDS) established a new legal entity that will be acting as a settlement guarantor.

This new institution named KDPW_Clearpool and fully owned by NDS will intervene, using own funds, in case of a default of one of the NDS participants. KDPW_Clearpool will be acting on the basis of the agreement with NDS, and will not have direct legal relationships with NDS participants.

The following actions would be taken in case of NDS par-ticipant default:

In the first stage settlement obligations of a NDS participant shall be paid using the amounts they are due to receive within the NDS settlement system.

Should these amounts be insufficient, NDS would use amounts collected in the Settlement Guarantee Fund:

1. As the first step margin deposits paid in by the affected participant would be used.

2. Secondly, contributions paid in by the given participant to the relevant part of the settlement fund would be con-sumed.

3. Subsequently, NDS would use all other contributions paid in the system by the given participant (including settlement funds for other markets).

4. Finally, NDS would use regular contributions paid in the relevant part of the settlement fund paid in by other NDS participants.

In case the sum of the funds mentioned above was still insuf-ficient to settle liabilities of the NDS participant who went bankrupt, NDS would call all NDS participants to put addi-tional contributions to the system.

1. All NDS participants would be obliged to put additional contributions in accordance with the NDS call. It is stated that such additional contribution could not exceed 110% of the regular one and only 50% of this additional contribu-tion could be used in this step.

2. If these additional funds did not allow NDS to finally settle all obligations, KDPW_Clearpool funds, in the amount of up to PLN 20 mn, would be used.


20 Poland

3. As a next step NDS would use the remaining part of the additional contribution mentioned in point 1 above.

4. Further amounts deposited in KDPW_Clearpool would be disposed on the basis of NDS Management Board resolutions.

Currently KDPW_Clearpool has PLN 60 mn of own capital, out of which PLN 20 mn could be automatically used, as described in the above procedure, while the usage of the remaining PLN 40 mn shall be dependent on NDS Manage-ment Board decisions.

Impact on InvestorsNDS claims establishment of KDPW_Clearpool should be seen as a step towards the introduction of the real CCP model in Poland. The new procedure should become operational along with the implementation of new method-ology for calculations of margins and contributions to the settlement guarantee system – based on SPAN® method-ology that is scheduled for the beginning of 2011.

One of the main advantages shall be the limitation of addi-tional contributions that may be required from NDS partici-pants (currently, there is no upper limit for such extra con-tributions).

Written and edited by: Krzysztof Pekrul Relationship ManagerTel. +48225245864 · [email protected]



21

Market Capitalisation RON 100.9bn




SE Turnover (Bucharest SE) RON 1,032.6mn

Monthly Index Performance (BET/BSE) -4.7%





EUR/RON 4.16



RomaNIa


2200

2700

3200

3700

4200

4700

5200

5700

6200

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Economy – Central BankRomania’s Central Bank Governor Mugur Isarescu declared: “the budgetary correction is unavoidable / the longer we postpone it, the greatest the pain”Romanian Central Bank Governor Mugur Isarescu declared these days that the recession in Romania is low and this is because the fiscal space to push the economy is low. The Governor appreciated that the budgetary correction meas-ures will be difficult and painful from a social point of view. The illusion that we can find solutions to a higher budgetary deficit is wrong and an increase in taxes is inefficient if budgetary spending is not decreased.

The economic growth Romania witnessed in the last years was based on unsustainable disequilibrium, Isarescu said. The deficit was huge, stimulated by capital entries and the crisis taught us that these disequilibrium needed to be cor-rected.

Some of the examples refer to the real estate boom, which was registered in some cities and the fact that the state increased salaries and pensions without grounds, but the good news is that we did not have bank crashes, we did not experience a huge public debt and we did not have toxic actives.

Impact on investorsCentral Bank Governor about the Government’s austerity measures.

EconomyPetrom plans to build a natural gas deposit in South West Romania OMV Petrom plans to build a natural gas deposit in South West Romania, following the Nabucco pipeline project, Gerald Kapes, company representative declared, quoted by the Romanian news agency Mediafax. However, he did not offer any details regarding the moment and the value of the investment.

The company is not interested to export natural gases, in the current market conditions. Nabucco plans to diversify Europe’s natural gas supplies by gaining access to producers in the Caspian region and Central Asia.

Impact on investorsNatural gas deposit to be built by Petrom.


22 Romania

The Romanian Pension Funds’ Association (APAPR) about the decision to reduce the contribution to the 2nd pier of the private pensions systemAs the data presented by the Romanian Pension Funds’ Association (APAPR) shows, after two years of transfers to the second pier (compulsory private pensions), 2.63 bn lei have been transferred to the system and the net actives managed by the pension funds amount to 3.14 bn lei. This means a net profit of 511 mn lei for over 5 mn participants.

The Minister of Finance, Sebastian Vladescu, made official the fact that the mandatory private pensions’ system will be affected by reducing the contributions’ level by 2%. There has been a decision to nationalize the private pensions’ system, not in the literal meaning, but when state authorities interfere and affect private accounts, it can only be nationalization. Moreover, if this decision will be adopted by the Government, we are most likely facing the bankruptcy of the private pen-sions’ system”, declared APAPR President Crinu Andanut.

According to APAPR data, Romania ranks last in the region as regards the money raised so far in the population’s accounts for private pensions. Therefore, in Romania, the average value of the individual account for the second pier is EUR 152. The first three positions in the region go to Poland, Hungary and Croatia, with average values of EUR 3446, EUR 3193 and EUR 2854, respectively.

Impact on investors: In Romania the average value of the individual account for the second pier is EUR 152.

Written and edited by: Irina Savastre Head of Global Securities ServicesTel. +40 21 200 26 70 · [email protected]



23

Market Capitalisation RUB 15.1trn


Number of SE Transactions p.m. (MICEX) 9,826,054


SE Turnover (MICEX) RUB 6.2trn

Monthly Index Performance (RTS) -7.4%





EUR/RUB 38.99

Upcoming Holidays 14 June


RUSSIa


600

800

1000

1200

1400

1600

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Central Bank Decreased the Refinancing RateThe refinancing rate has been reduced to 8% according to the decision of the Central Bank starting from 30 April 2010.

Impact on investorsImproving of economic climate and stimulation of banks’ credit activity.

FFMS provision on derivatives typesFederal Financial Market Services (FFMS) has published the Provision with the description of the derivatives types rec-ognized on Russian market.

According to the FFMS the following contracts are recognized as derivatives:

■■ Option contract

■■ Futures contract

■■ Stock exchange forward contract

■■ OTC forward contract

■■ Swap contract

The Provision also contains the list of underlying assets for derivatives.

Impact on InvestorsThe legislation development for derivative securities should improve the diversity of financial instruments on Russian market and attract different types of investors to the Rus-sian market also in the light of creation of the International Financial Centre in Moscow.

Central Depository conceptThe Head of Federal Financial Market Services (FFMS) has announced that Regulator has defined the concept of the Cen-tral Depository. FFMS should use the British concept of the Central Depository according to which the Central Depository will execute functions of the registrar only for the issued shares traded on the organized markets. This concept will keep the existing securities market system and its players such as regis-trars, depositories and settlement depositories. FFMS considers that there should be only one Central Depository on the market.

Currently two organizations pretend to a role of the Central Depository – National Depository Centre (NDC) and Depository Clearing Company (DCC).This concept should be included into Law on Central Depository which is currently under discussion.


24 Russia

The representatives of the biggest custodian on the Rus-sian market including Head of GSS UniCredit Bank Moscow – Alexander Nazarov- take active part in the discussion of Central Depository concept and respective law.

Impact on InvestorsThe determination of the concept of the Central Depository will expedite its creation in Russia.

The registrars could be added into the list of Companies Having Strategic ImportanceThe Federal Antimonopoly Agency (FAS) announced plans to amend Federal Law “On Foreign Investments in Companies Having Strategic Importance for State Security and Defense”. According to the law amendment draft the registrar of share-holders should bear the status of the Companies Having Strategic Importance.

Impact on investorsThe foreign investors will be required to obtain FAS approval for registrar share capital purchase.

RTS shifts the trading session start timeEffective on 17 May 2010 the main trading session on all Russia Trading System (RTS) markets will take place from 10:00 am to 6:45 pm MSK. The decision to move the open-ing time of the main trading session to 10.00 am MSK was made by the Board of Directors of RTS Stock Exchange on 23 April 2010.

This decision establishes the following operating schedule that will become effective on 17 May 2010 (all times are MSK):

10:00 am – 6:45 pm - main trading session on all markets6:45 pm – 7:00 pm - evening clearing session on RTS Stand-ard and FORTS7:00 pm – 11:50 pm - evening trading session on RTS Stand-ard and FORTS

From 2:00 pm to 2:03 pm there will be an intraday clearing session held on RTS Standard and FORTS.

In accordance with the decision by the Board of Directors the pre-trading period (if held) takes place from 9:45 am to 10:00 am on the current trading day.

On the last trading day of the calendar week the trading session in the on-exchange trading mode with settlement on T+0 is to be held from 10:00 am to 6:55 pm on the cur-rent trading day.

Impact on investorsTrading period extension.

“Independent Director” concept should be finalised in the Law “On Joint Stock Companies”The Ministry of Economic Development has announced the upcoming amendments to the Law “On Joint Stock Compa-nies” in respect of Independent Directors activity in Russian Stock companies.

These amendments should finalize the concept of Independ-ent Director in the Law, implement requirement to the candi-dates. The period of work of Independent Director with one joint stock company should be limited to 5 years.

Impact on investorsImprovement of the Code of Corporate Governance.

“Consolidated shareholders’ ” rights should be deprivedThe draft of amendments to the Law “On Joint Stock Com-panies” in respect to shareholders’ rights will be reviewed by the state of Duma. This amendment should implement the concept of “consolidated entities” meaning the entities included into consolidated finance report of the joint stock company. In case a consolidated entity holds the shares of joint stock company (quasi-treasury shares), such holding should be deprived of voting and income rights.

Consolidated shareholders should be obliged to keep their holdings in local shares only and will not be allowed to create ADR/GDR for such holdings.

Impact on investorsThis amendment should increase transparency of stock company ownership structure and protect the rights of minority shareholders.

Russian Eurobonds placementOn 22 April 2010 Russian Federation has placed two tranches of sovereign Eurobonds for the amount of USD 5.5 bn:

■■ USD 2 bn 5-years coupon 3.6% spread contracted by 125bps

■■ USD 3.5 bn 10-years coupon 5% spread contracted by 135bps.

Impact on investorsAdditional investment possibility.

Written and edited by: Alexander Nazarov Director, Global Securities ServicesTel. +7 495 258-7349 · [email protected]


25

Market Capitalisation RSD 888.1bn




SE Turnover (Belgrade SE) RSD 1.66bn

Monthly Index Performance (Belex 15) 9.4%





EUR/RSD 99.91


Source: Bloomberg

SERBIa


400

500

600

700

800

900

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Serbia emerges from recessionAccording to the first flash-estimate given by the Statistical Office of the Republic of Serbia, Serbian economy is emerg-ing from recession as the country’s Gross Domestic Product (GDP) grows by 1% year-on-year in real terms in Q1 2010, after last year’s constant decline, when 2009 GDP fell by 3%. The economy grew by 1.2% compared to the previous quarter. According to the International Monetary Fund (IMF) forecasts, the country’s GDP will grow by 2% in 2010 and 3% in 2011.

Flash-estimates were adopted by the EU during the global economic crisis in order to facilitate early information on the economy’s shape. They are produced in the period of 30 to 45 days from the respective quarter. In addition, regular estimations are published from 60 to 90 days after the end of the respective quarter.

Impact on investorsSerbia is emerging from recession, according to data of the Statistical Office of the Republic of Serbia.

Written and edited by: Goran Platisa Senior Corporate Actions and Tax SpecialistTel. +381 11 3028 687 · [email protected]



26

Market Capitalisation EUR 25.3bn


Number of SE Transactions p.m. 404.0


SE Turnover (Bratislava SE) EUR 0.3bn

Monthly Index Performance (SAX/BSSE) 5.2%





EUR/SKK 30.13



SLovaK REpUBLIC


200

225

250

275

300

325

350

375

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Bratislava Stock Exchange Trading in AprilIn the month of April 2010, the electronic trading system of the Bratislava Stock Exchange (BSSE) was accessible to members in 20 business days. A total of 404 transactions were concluded in this period in a financial volume of nearly EUR 330 mn. In comparison with the previous month, it rep-resents a 6.57% increase in the achieved financial volume, whereas the number of concluded transactions fell by 29%. When compared with the same month of the year 2009, both the amount of traded securities and the achieved volume decreased (-31.70% and -39.20%, respectively). Negotiated deals prevailed over electronic order book (i.e. price-setting) transactions in April 2010, with the former representing 99.47% of the total trading volume.

Investors continued to focus on debt securities, when bond transactions generated 98.26% of the achieved volume. A total of 109 bond transactions were concluded in this period, in a volume of nearly EUR 324.3 mn. Equity securities were bought and sold in 295 transactions, in a financial volume of EUR 5.73 mn. Compared with March 2010, it represents a 578.77% increase in volume. The number of concluded transactions dropped in the same comparison by 35.87%. Substantial increases were recorded on a year-on-year basis: +201.02% for the number of concluded transactions, +861.21%.

A total of 1,772 transactions, in a financial volume of EUR 2.7 bn, have been cumulatively concluded on the BSSE since the start of this year. It represents a 35.93% decline against the same period of the previous year.

Transactions concluded by non-residents in April 2010 rep-resented 50.63% of the total trading volume.

As of the last trading day of April 2010, the market capitalisa-tion of equity securities decreased on a month-on-previous-month basis by 2.47% to EUR 3.48 bn. As of the last trading day of the month under review, the market capitalisation of bonds amounted to EUR 21.78 bn, representing a 6.02% increase on a month-on-previous-month basis.

The SAX index ended the month of April 2010 at 238.23 points, representing a 2.76% decline on a month-on-previ-ous-month basis and a 29.50% decline year on year.

Impact on investorsBSSE performance in April 2010.


27 Slovak Republic

Revision of SAX Index BaseIn respect with the Rules of Construction of SAX Index (Slovak share index), BSSE revised the SAX Index base. The adjust-ment coefficients of companies Slovnaft and VUB were modi-fied in connection with the dividend payments. Since 1 Febru-ary 2010 SAX Index includes 9 issues of 5 listed companies.

Weights of SAX Index Components as of 30 April 2010

Written and edited by: Zuzana Milanova Sales & Relationship ManagerTel. +421 2 4950 3702 · [email protected]

Company name ISIN Abbrev. Weights in %

Biotika, a.s. CS0009013453, SK1120004009 BSL 5.93

OTP Banka Slovensko, a.s. SK1110001452, SK1110004613 OTP 18.27

Slovenské energetické strojárne, a.s. SK1120008034 SES 17.87

Slovnaft, a.s. CS0009004452, SK1120001369, SK1120005949 SLN 26.25

Všeobecná úverová banka, a.s. SK1110001437 VUB 31.68

Impact on investorsSAX Index Base adjustment.



28

Market Capitalisation EUR 21,645mn




SE Turnover (Ljubljana SE) EUR 37.0mn

Monthly Index Performance (SBI 20) -2.4%







SLovENIa


3500

3750

4000

4250

4500

4750

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Think-Tank Says Higher Minimum Wage to Cost 5,000 JobsThe recent 22.9% increase in the minimum wage could cost over 5,000 jobs in the short term and over 17,000 in the medium term, according to the Institute for Macroeconomic Analysis and Development (IMAD), the government’s eco-nomic think-tank.

“There will be a stepwise adjustment. Most likely, the mini-mum wage hike will lead to additional layoffs in a relatively short time,” IMAD director Bostjan Vasle said on Friday, 2 April 2010 at a presentation of the spring economic fore-cast.

Over the medium term a lot will depend on how companies react. If they fail to take action in production, the increase in unemployment could be even higher in two to three years, he said.

But Vasle also pointed out that the 17,000 figure is a worst-case scenario. “In this period firms will probably adapt and find other solutions instead of laying off workers.”

An analysis by IMAD on the effects of the new minimum wage also suggests that a higher minimum wage will increase pressure on pay increases overall.

The minimum wage rose 22.9% to EUR 734.15 gross in accordance with legislation that took effect in February. How-ever, companies in trouble can opt for a gradual increase over two years.

Slovenia’s unemployment rate stood at 10.6% in January, but IMAD believes the situation will get worse. It projects that the registered jobless rate will rise to 11.1%.


Ernst & Young Forecasts 0.9% Growth for SloveniaInternational business consultants Ernst & Young predict Slovenia’s economy will grow by 0.9% this year. They say that the growth in Slovenia will be closely connected to the recovery in the eurozone.

The growth in Slovenia will be similar to that of the eurozone in general, where Ernst & Young predicts the economy will grow by 1%. According to its forecasts, growth in the euro-zone will not reach pre-2008 levels before 2013.


29 Slovenia

The 8.1% contraction in Slovenia’s economy in 2009 was a result of Slovenia’s heavy dependence on international trade. Likewise Slovenia’s recovery will be hindered due to its dependence on the eurozone, which will continue to see sluggish growth. Nevertheless, growth is expected to pick up to 2% in 2011 and to as much as 4% in 2012, when capital formations start to pick up again.

Ernst & Young adds that inflation in Slovenia is expected to stand at 2% in 2010 and rise to 2.5% in 2011.


Written and edited by: Elmedina Garibovic Relationship ManagerTel. +386 1 5876 453 · [email protected]


30

Market Capitalisation UAH 267.0bn




SE Turnover (PFTS) UAH 7.5bn

Monthly Index Performance (PFTS) 11.2%





EUR/UAH 10.09



UKRaINE


1000

2000

3000

4000

5000

6000

7000

Ma

i

Ju

n

Ju

l

Au

g

Se

p

Okt

No

v

De

z

Ja

n

Fe

b

Mrz

Ap

r

Ma

i


Leading Ukrainian banks with foreign capital to address authoritiesAccording to forum of leading international financial institu-tions in Ukraine, banks with foreign capital are teaming up for a dialogue with the authorities.

Nine leading Ukrainian banks with foreign capital, including OJSC UniCredit Bank announced the creation of a new dis-cussion platform for the leading international financial insti-tutions. The task of the forum is to support a high-profile dialogue with state organizations to develop the Ukrainian financial sector in line with international standards.

Impact on investorsForum of leading international finacial institutions is to sup-port top-level dialog with Ukranian authorities.

European Parliament approved EUR 500 mn of financial aid to UkraineThe European Parliament approved a EUR 500 mn loan to Ukraine to help it overcome the financial crisis.

According to European Parliament President Jerzy Buzek, the European Parliament will support Ukraine with financial assist-ance and declare it a close strategic partner of the European Union. Furthermore, Buzek stated that the assistance is pro-vided at a time when the EU is helping to mobilize financing to support the reform of the Ukrainian energy sector, including developing a sustainable solution to Ukraine’s medium-term gas transit and gas payment obligations. Nevertheless, EU macro-financial assistance can only contribute to economic stabilization if the main political forces in Ukraine ensure politi-cal stability and implement the necessary structural reforms.

Impact on investorsEuropean Parliament to support Ukraine with EUR 500 mn.

Written and edited by: Ganna Sankina Relationship ManagerTel.: +38 044 590 1209 · [email protected]



31

yoUR CoNTaCTSRegional responsibilityAttila Szalay-Berzeviczy Tel. +35 1 301 1910 [email protected]

Pawel Muszalski Tel. +43 50505 57315 [email protected]

Markus Winkler Tel. +43 50505 58547 [email protected]

Sven Trahan Tel. +43 50505 57311 [email protected]

Beata Szonyi Tel. +36 1 301 1924 [email protected]

Ewa Stupkiewicz Tel. +43 50505 58511 [email protected]

Philipp Aschl Tel. +43 50505 58508 [email protected]

AustriaUniCredit Bank Austria AG Julius Tandler-Platz 3 A-1090 Vienna Austria

Günter Schnaitt Tel. +43 50505 58501 [email protected]

Thomas Rosmanitz Tel. +43 50505 58515 [email protected]

Tina Fischer Tel. +43 50505 58512 [email protected]

Stephan Hans Tel. +43 50505 58513 [email protected]

Bosnia and HerzegovinaUniCredit Bank d.d. Zelenih Beretki 24 BA-71000 Sarajevo Bosnia

Lejla Sabljica Tel. +387 33 562 777 [email protected]

Amra Telacevic Tel. +387 33 562 816 [email protected]

BulgariaUniCredit Bulbank AD 6 Vitosha Boulevard, 2nd floor BG-1000 Sofia Bulgaria

Veselin Stefanov Tel. + 359 2 93 20 112 [email protected]

CroatiaZagrebacka Banka d.d. Savska 60/IV HR-10000 Zagreb Croatia

Valerija Bezak Tel. +385 1 6305 430 [email protected]

Snjezana Bruncic Tel. +385 1 6305 400 [email protected]

Czech RepublicUniCredit Bank Czech Republic a.s. Revolucni 7 CZ-110 05 Prague Czech Republic

Michal Stuchlik Tel. +420 22121 6770 [email protected]

Ales Polasek Tel. +420 22121 6771 [email protected]

Dita Safarova Tel. + 420 221 112 942 [email protected]

Tomas Vacha T. + 420 221 216 773 [email protected]


32 Your Contacts

HungaryUniCredit Bank Hungary Zrt. Szabadsag ter 5 – 6, 6th floor H-1054 Budapest Hungary

Júlia Romhányi Tel. +36 1 301 1923 [email protected]

Zsanett Lencses Tel. +36 1 301 1920 [email protected]

Livia Meszaros Tel. +36 1 301 1921 [email protected]

KazakhstanJSC ATF Bank Furmanov Street 100 KZ-050000 Almaty Republic of Kazakhstan

Vladimir Vassilyev Tel. +7 727 258 3015 (1353) [email protected]

Natalya Kolnogorova Tel. +7 727 258 3015 (1232) [email protected]

PolandBank Polska Kasa Opieki SA (short: Bank Pekao) Ul. Grzybowska 53/57 PL-00-950 Warsaw Poland

Tomasz Grajewski Tel. +48 22 524 5867 [email protected]

Mariusz Piekos Tel. +48 22 524 5852 [email protected]

Kamil Polak Tel. +48 22 524 5863 [email protected]

Marta Boboryk Tel. +48 22 656 10 92 [email protected]

Krzysztof Pekrul Tel. +48 22 524 5864 [email protected]

Marek Cioroch Tel. +48 22 524 5862 [email protected]

RomaniaUniCredit Tiriac Bank S.A. Ghetarilor Street 23 – 25 RO-014106, Bucharest 1 Romania

Irina Savastre Tel. +40 21 200 2670 [email protected]

Viviana Traistaru Tel. +40 21 200 2673 [email protected]

RussiaZAO UniCredit Bank 9, Prechistenskaya Emb. RU-119034 Moscow Russian Federation

Alexander Nazarov Tel. +7 495 258 73 49 [email protected]

SerbiaUniCredit Bank Serbia JSC Omladinskih Brigada 88 RS-11070 Belgrade Serbia

Jasmina Radicevic Tel. +381 11 3028 611 [email protected]

Goran Platiša Tel. +381 11 3028 687 [email protected]

SlovakiaUniCredit Bank Slovakia A.S. Sancova 1/A SK-811 04 Bratislava Slovak Republic

Matej Letko Tel. +421 2 4950 3701 [email protected]

Zuzana Milanova Tel. +421 2 4950 3702 [email protected]


33 Your Contacts

SloveniaUniCredit Bank Slovenija d.d. Wolfova 1 SI-1000 Ljubljana Slovenia

Vanda Mocnik-Kohek Head of GSS Slovenia Tel. +386 1 5876 450 [email protected]

Elmedina Garibovic Tel. +386 1 5876 453 [email protected]

UkraineUniCredit Bank LLC 14a, Yaroslaviv Val UA-01034 Kyiv Ukraine

Bohdana Yefremova Tel. +380 44 230 3341 [email protected]

Elizaveta Sotnichenko Tel. +380 44 590 1208 [email protected]

Ganna Sankina Tel.: +380 44 590-1209 [email protected]

Katherine Yevtushenko Tel. +380 44 590-1210 [email protected]

Websiteshttp://custody.ba-ca.com http://www.unicreditgroup.eu http://www.bankaustria.at

http://custody.ba-ca.com

http://www.unicreditgroup.eu


34

DISCLaImERThe information in this publication is based on carefully selected sources believed to be reliable but we do not make any representation as to its accuracy or completeness. Any opinions herein reflect our judgement at the date hereof and are subject to change without notice. Any investments presented in this report may be unsuitable for the investor depending on his or her specific investment objectives and financial position. Any reports provided herein are provided for general information purposes only and cannot substitute the obtaining of independent financial advice. Private inves-tors should obtain the advice of their banker/broker about any investments concerned prior to making them. Nothing in this publication is intended to create contractual obligations on any of the entities composing Corporate & Investment Banking Division of UniCredit Group which is composed of (the respective divisions of) UniCredit Bank AG, Munich, UniCredit Bank Austria AG, Vienna, and UniCredit S.p.A., Rome.

UniCredit Bank AG is regulated by the German Financial Supervisory Author-ity (BaFin), UniCredit Bank Austria AG is regulated by the Austrian Financial Market Authority (FMA), the UniCredit CAIB Securtities UK Ltd. is regulated by the Financial Services Authority (FSA) and UniCredit S.p.A. is regulated by both the Banca d’Italia and the Commissione Nazionale per le Società e la Borsa (Consob).

Note to UK Residents:

In the United Kingdom, this publication is being communicated on a confi-dential basis only to clients of Corporate & Investment Banking Division of UniCredit Group (acting through UniCredit Bank AG, London Branch (“UCB London”) and/or UniCredit CAIB Securities UK Ltd. who (i) have professional experience in matters relating to investments being investment professionals as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (“FPO”); and/or (ii) are falling within Article 49(2) (a) – (d) (“high net worth companies, unincorporated associations etc.”) of the FPO (or, to the extent that this publication relates to an unregulated collective scheme, to professional investors as defined in Article 14(5) of the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes) (Exemptions) Order 2001 and/or (iii) to whom it may be lawful to communicate it, other than private investors (all such persons being referred to as “Relevant Persons”). This publication is only directed at Relevant Persons and any investment or investment activity to which this publication relates is only available to Relevant Persons or will be engaged in only with Relevant Persons. Solicitations resulting from this publication will only be responded to if the person concerned is a Relevant Person. Other persons should not rely or act upon this publication or any of its contents.

The information provided herein (including any report set out herein) does not constitute a solicitation to buy or an offer to sell any securities. The information in this publication is based on carefully selected sources believed to be reliable but we do not make any representation as to its accuracy or completeness. Any opinions herein reflect our judgement at the date hereof and are subject to change without notice.

We and/or any other entity of the Corporate & Investment Banking Division of UniCredit Group may from time to time with respect to securities mentioned in this publication (i) take a long or short position and buy or sell such securities; (ii) act as investment bankers and/or commercial bankers for issuers of such securities; (iii) be represented on the board of any issuers of such securi-ties; (iv) engage in “market making” of such securities; (v) have a consulting relationship with any issuer. Any investments discussed or recommended in any report provided herein may be unsuitable for investors depending on their specific investment objectives and financial position. Any information provided herein is provided for general information purposes only and cannot substitute the obtaining of independent financial advice.

UCB London is regulated, to a limited extent, by the Financial Services Author-ity for the conduct of business in the UK as well as by BaFIN, Germany. UniCredit CAIB Securities UK Ltd., London, a subsidiary of UniCredit Bank Austria AG, is authorised and regulated by the Financial Services Authority.

Notwithstanding the above, if this publication relates to securities subject to the Prospectus Directive (2005) it is sent to you on the basis that you are a Qualified Investor for the purposes of the directive or any relevant implementing legislation of a European Economic Area (“EEA”) Member State which has implemented the Prospectus Directive and it must not be given to any person who is not a Qualified Investor. By being in receipt of this publication you under-take that you will only offer or sell the securities described in this publication in circumstances which do not require the production of a prospectus under Article 3 of the Prospectus Directive or any relevant implementing legislation of an EEA Member State which has implemented the Prospectus Directive.

Note to US Residents:

The information provided herein or contained in any report provided herein is intended solely for institutional clients of Corporate & Investment Banking Division of UniCredit Group acting through UniCredit Bank AG, New York Branch and UniCredit Capital Markets, Inc. (together “UniCredit”) in the United States, and may not be used or relied upon by any other person for any purpose. It does not constitute a solicitation to buy or an offer to sell any securities under the Securities Act of 1933, as amended, or under any other US federal or state securities laws, rules or regulations. Investments in securities discussed herein may be unsuitable for investors, depending on their specific investment objectives, risk tolerance and financial position.

In jurisdictions where UniCredit is not registered or licensed to trade in securi-ties, commodities or other financial products, any transaction may be effected only in accordance with applicable laws and legislation, which may vary from jurisdiction to jurisdiction and may require that a transaction be made in accord-ance with applicable exemptions from registration or licensing requirements.

All information contained herein is based on carefully selected sources believed to be reliable, but UniCredit makes no representations as to its accuracy or completeness. Any opinions contained herein reflect UniCerdit’s judgement as of the original date of publication, without regard to the date on which you may receive such information, and are subject to change without notice.

UniCredit may have issued other reports that are inconsistent with, and reach different conclusions from, the information presented in any report provided herein. Those reports reflect the different assumptions, views and analytical methods of the analysts who prepared them. Past performance should not be taken as an indication or guarantee of further performance, and no representa-tion or warranty, express or implied, is made regarding future performance.

UniCredit and/or any other entity of Corporate & Investment Banking Division of UniCredit Group may from time to time, with respect to any securities dis-cussed herein: (i) take a long or short position and buy or sell such securities; (ii) act as investment and/or commercial bankers for issuers of such securities; (iii) be represented on the board of such issuers; (iv) engage in “market making” of such securities; and (v) act as a paid consultant or adviser to any issuer.

The information contained in any report provided herein may include forward-looking statements within the meaning of US federal securities laws that are subject to risks and uncertainties. Factors that could cause a company’s actual results and financial condition to differ from its expectations include, without limitation: Political uncertainty, changes in economic conditions that adversely affect the level of demand for the company’s products or services, changes in foreign exchange markets, changes in international and domestic financial markets, competitive environments and other factors relating to the foregoing. All forward-looking statements contained in this report are qualified in their entirety by this cautionary statement.

Corporate & Investment Banking Division of UniCredit Group

UniCredit Bank AG, Munich; UniCredit Bank Austria AG, Vienna and UniCredit S.p.A., Rome

as of 29 March 2010


35

ImpRINTStatement pursuant to the Austrian Media Act Publisher and Media Owner

Corporate & Investment Banking Global Transaction Banking UniCredit Bank Austria AG Global Securities Services Julius Tandler-Platz 3 A-1090 Vienna Tel. +43 50505 0

Information requirements pursuant to the Austrian E-Commerce Act

Registered office and postal address Schottengasse 6 – 8 A-1010 Vienna

Swift: BKAUATWW Austrian bank code: 12.000

Registeredunder no. FN 150714p Companies Register at the Commercial Court Vienna

Kind of businessCredit institution under section 1 (1) Austrian Banking Act

Supervisory authorityAustrian Financial Market Supervisory Authority (Finanzmarktaufsicht), departments banking supervision and securities supervisionPraterstraße 23 A-1020 Vienna http://www.fma.gv.at

MembershipAustrian Federal Economic Chamber, bank and insurance division Wiedner Hauptstraße 63 A-1040 Vienna http://www.wko.at Austrian Bankers‘ Association A-1013 Vienna, p.o.box 132 http://www.voebb.at;

Applicable legal regulationsApplicable legal regulations are in particular the Austrian Banking Act (“Bankwesengesetz – BWG”, Federal Law Gazette/BGBl. No. 532/1993, with some amendments), the Austrian Securities Supervision Act (“Wertpapieraufsichtsgesetz – WAG”, Federal Law Gazette/BGBl. No. 753/1996, with some amendments) an the Austrian Savings Banks Act (“Sparkassengesetz”, Federal Law Gazette/BGBl. No. 64/1979, with some amendments).

VAT identification numberATU 51507409

gss newsletterissue 110, june 2010 4 dear clients it is my pleasure to present you, in the may issue...

Documents