Preparing for the Implementation of the MiFID at the Warsaw Stock Exchange

Split, 15 June 2007

Main Opportunities and Challenges:

• Best execution & transparency requirements• Connectivity, speed, latency and algorythmic

trading• Market for analysis & integrated data sources• Abolition of concentration rule & increased

competition

1

WSE READY FOR MIFID?

Price, Size & Cost of order execution

• Fully electronic, order driven market • Trading sessions: from 9:00 to 16:35• Auction & continuos trading modes with openning and closing procedures• Trading supported by Exchange and Issuer Animators• Block trades and trade reporting facility for cash and derivatives• Fixed and moving price variation limits & trading halts• Trading fee dependent of the volume executed with the maximum cap of

1000 PLN (<200 EUR)

Further improvements: • Cross trade facility• Changes in liquidity supporting model – revenue sharing• Continous decreasing of trading fees

BEST EXECUTION

2

Likehood of execution and settlement

WSE provides the highest level of execution certainty and quality on the Polish market:

- Most of traded instruments are supported by Exchange or/and Issuer Animators providing the market with maximum spread and minimum volumes continously during the trading session

- Automatic triggering of Stop Orders increases the probability of order execution

- All session trades are subject of the Guarantee Fund which gives the certainty of settlement

- The continuity of settlement process is supported by Buy In- Sell Out Market operated by WSE

BEST EXECUTION

3

Order types and traded instruments

IT system operated by WSE allows a numerous types of orders and order execution conditions:

Limited orders• Orders with no limit:

– Must be Filled Order– Market Order– Market At Opening Order

• Stop Loss, Minimum Quantity and Iceberg Orders•Fill and Kill, Fill or Kill Orders

The rules for order entry and execution, as well as available trading phases, price limits and price ticks are dependent of type of instrument in order to fit to its characteristics and investors needs. The WSE currently maintain the wide range of cash and derivatives instruments on fully integrated trading platform with single access point.

BEST EXECUTION

4

Speed

• High avaiability of trading platform• Order execution notices in on-line mode• Easy and fast access to order book through Internet for retail clients

of Brokerage Houses• Algorythms for minimizing the number of trades at opening to speed

up order execution• Continuous improvement of the IT architecture – recent swith to

Itanium processor improved the trading system efficency four times.

BEST EXECUTION

5

WSE provides a full range of information for all market participants and Data Vendors with no delays for block trades.

Pre trade:

• Theoretical Opening Price

• Theoretical opening Volume

• Full range of order book with prices and volumes of orders awaiting for the execution

Post trade:•On line distribution of traded volumes and prices with timestamp

•Calculation and on-line distribution of main indexes

•Distribution of analytics data after trading session

TRANSPARENCY

6

WSE offers fast and secured access to the trading system

• Two Communication Protocols:

– MMTP (MARKET MESSAGE TRANSFER PROTOCOL) – OR FIX (FINANCIAL EXCHANGE PROTOCOL)

• Open Architecture:– Flexibility– Possibility for Member System Customization

• Numerous Client Applications:

– GL– RTS– LIST– ORC – FIDESSA

• WSE as a maintanance services provider for GL Trade products, including software for automated trading

CONNECTIVITY AND ACCESIBILITY

7

•Possible numerous trading venues, best execution requirements and trade transparency rules would lead to increased demand of integrated data sources and analysis.

•WSE maintains the largest data distribution network in CEE consisting of:

– 26 Polish and 16 Foreign (UK, Switzerland, US, France, Austria, Sweden and Norway) with 130 000 end-users worldwide

– Satellite and ISDN connections– Different types of data including row figures and analysis

WSE AS INTEGRATED SOURCE OF MARKET DATA

7

NEW QUALITY IN MARKET INFORMATION

WSEInfoSpace

CURRENT INFORMATION

(Level 1, 2 and 3 data)

COMPANIESInformation & analyses

on WSE-listed companies

(Level 1 data)

ANALYSESMacroeconomic & sector information

& analyses on individual CEE countries

(Level 2 and 3 data + link to level 1 data)

Data levels:3 – MACROECONOMIC

2 – SECTORS

1 – COMPANIES

Data sources:PAP – PRESS AGENCY

WSE

COMPANIES

ANALYSTS

OTHER

MEDIA

Data channels:ESPI

OTHER

9

10

INCREASED COMPETITION

•Alternative market for small caps with big growthpotential•Support for growing sector ofhigh technologycompanies•Further development of Polishcapital market financialinfrastructure as an element ofincreasing WSEcompetence at the local andregional market •Strenghtening a co-operationbetween the WSE and itsbusiness partners in order tospeed up the growth ofthe Polish capital market

Warsaw Stock Exchange

4 Ksiazeca Street, 00-498 Warsaw

Phone: +48 22 537 76 74

http://www.wse.com.pl

E-mail: gielda@wse.pl